Rishabh Instruments Limited — Q3 FY26 earnings call

Call held 6 Feb 2026

Management summary

Rishabh Instruments reported a strong Q3 FY26 with significant margin expansion across its consolidated and standalone businesses, driven by cost efficiencies and a favorable product mix. While the Electrical & Electronic Instrumentation segment performed well, the Alucast segment continued its planned transition with a revenue decline. The company highlighted positive policy developments and strategic initiatives for long-term growth, including capacity expansion and R&D, but noted ongoing uncertainties in global trade and specific market conditions.

Highlights

  • Consolidated EBITDA margin significantly expanded to 17.1% in Q3 FY26, up 920 bps YoY, driven by cost optimization, operational efficiencies, and favorable product mix.

  • Rishabh Instruments India (Standalone) delivered strong margin performance with EBITDA margin at 21.1% in Q3 FY26, an improvement of 1,109 bps YoY.

  • LUMEL S.A. showed robust growth with revenue up 22.4% YoY and healthy EBITDA margins of 26.7% in Q3 FY26.

  • The Electrical and Electronic Instrumentation (EEI) segment, the main growth driver, grew 17.7% YoY with an adjusted EBITDA margin of 26.6%.

  • The solar business has turned profitable and is targeted for significant growth, with new orders secured for single-phase inverters.

Concerns

  • LUMEL Alucast (high-pressure die-casting) segment revenue declined 29.1% YoY in Q3 FY26 and reported an adjusted EBITDA loss of ₹16 million.

  • The European market remains relatively subdued, impacting demand across industrial, automation, and power infrastructure.

  • Uncertainty regarding the actual implementation and impact of new trade agreements and tariffs, particularly the 18% flat duty on Indian exports to the US.

Key financials

  1. Consolidated Revenue 1,836 Mn +1.3%YoY
  2. Consolidated EBITDA 314 Mn +119.5%YoY
  3. Consolidated EBITDA Margin 17.1%
  4. Consolidated PAT 205 Mn +162%YoY

What they filed

Q1 FY27: revenue up 25.8%, net profit up 20.0% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue59 59 68 62 66 +12%61 +3%79 +16%78 +26%
EBITDA9 6 14 14 17 +89%13 +117%16 +14%18 +29%
Net profit7 4 9 10 13 +86%8 +100%11 +22%12 +20%
How to read this

₹ crore, as filed. The percentage beside a figure is the change against the same quarter a year earlier — never the quarter before, which would make every seasonal business look like it collapses and booms each year.

Segment breakdown

Share of Revenue
1,690 Mn Total
  • LUMEL S.A. 631 Mn 37.3%
  • Rishabh Instruments (Standalone) 611 Mn 36.2%
  • LUMEL Alucast 448 Mn 26.5%

Capital allocation

high confidence
  • Capex Capex disclosed
    • Capacity expansion at Nashik facilities (two new multi-storied buildings)
    As communicated earlier, work at our Nashik facilities is progressing as planned. The two new multi-storied buildings, comprising five and seven floors respectively, are currently under development and nearing completion. These facilities will effectively double our production capacity, enhancing our ability to cater to rising export demands and supporting the strong long-term growth trajectory of our India operations.
  • Debt Debt disclosed
    On the consolidated level, we remain net debt-free with a strong balance sheet.
  • Liquidity Cash ₹1,230 Mn
    The net cash and cash equivalents as on 31 December, 2025 stand at Rs.1,230 million.

Guidance & targets

Profitability

  • Consolidated Adjusted EBITDA Profitability · FY26 · High confidence ₹115-120 crores
    Looking ahead, we are targeting adjusted EBITDA to reach about Rs. 115 crores to Rs.120 crores by the end of financial year 2026

    — Narendra Goliya

  • High-Pressure Die-Casting (Alucast) Business EBITDA Profitability · during transition · High confidence above plus break-even levels
    Our priority here remains on managing the business at EBITDA above plus break-even levels, which we view as a positive outcome during this transition period.

    — Dinesh Musalekar

  • Alucast FY28 EBITDA Profitability · FY28 · High confidence double-digit EBITDA
    In FY'28, we definitely have to come back to what levels we were this year on the top line at the minimum and double-digit EBITDA is what we should be looking at.

    — Dinesh Musalekar

Revenue

  • EEI Segment Top-line Growth Revenue · FY26 · High confidence 15%-20%
    We remain confident that achieving 15%-20% top-line growth in this segment by year-end.

    — Dinesh Musalekar

  • Solar Business Revenue Revenue · FY26 · High confidence ₹10-12 crores
    For the current year, we may end up with around Rs.10 crores to Rs.12 crores of revenue here

    — Dinesh Musalekar

  • Solar Business Growth Revenue · next three years · High confidence 20-50% (initially 50-100%)
    over the next three years, we aim to scale this business meaningfully with a long-term aspiration of sustainable 20% to 50% growth. Initially, the growth will be in the range of 50% to 100%, later, it will taper down to something like 20% to 50%.

    — Dinesh Musalekar

  • Incremental Revenue from New Products Revenue · over a period of time · High confidence up to 50% of current electronic turnover
    We have rolled out a five-year strategic roadmap aimed at generating incremental revenue of up to 50% of our current electronic turnover, driven entirely by introduction of new product lines over a period of time.

    — Dinesh Musalekar

  • Alucast FY27 Revenue Revenue · FY27 · High confidence ₹150-160 crores

    Previously ₹200 crores (FY26 estimate) → ₹150-160 crores

    I would say compared to about to Rs.200 crores, which we may make this year, next coming financial year, I can see a dip of about Rs.50 crores to Rs.60 crores happening there... So, just wanted to understand, are we saying Rs.150-160 crores revenue next year at 4% EBITDA margin? Yes, so these are very lucid numbers. That is the kind of a broader guideline we are telling.

    — Dinesh Musalekar

  • India Business Growth Revenue · next year (FY27) · High confidence close to 30%
    for the next year, we have planned for India business itself, close to 30%

    — Dinesh Musalekar

  • Electronics Business Growth Revenue · ongoing · High confidence 20-25%
    confident of growing 20% to 25% with a healthy EBITDA of 20% to 25% which we have spoken, and we are delivering that more or less.

    — Dinesh Musalekar

  • US Market Revenue Revenue · in a few years' time · High confidence $5-10 million

    From $3 million (current year) today

    we are doing about $3 million this year... Now, we want to get it to $5 to $10 in a few years' time.

    — Dinesh Musalekar

Margin

  • EEI Segment EBITDA Margin Margin · ongoing · High confidence above 25%
    adjusted EBITDA margin improving to 26.6%, above the benchmark of 25% level for the segment.

    — Dinesh Musalekar

  • Alucast FY27 EBITDA Margin Margin · FY27 · High confidence 4-5%
    our target is to keep the EBITDA between around 5%... So, just wanted to understand, are we saying Rs.150-160 crores revenue next year at 4% EBITDA margin? Yes, so these are very lucid numbers. That is the kind of a broader guideline we are telling.

    — Dinesh Musalekar

  • Electronics Business EBITDA Margin · ongoing · High confidence 20-25%
    confident of growing 20% to 25% with a healthy EBITDA of 20% to 25% which we have spoken, and we are delivering that more or less.

    — Dinesh Musalekar

What to watch in Q4 FY26

Nashik CAPEX operationalization

H2 FY27
Current Under development, nearing completion
Target Commercial operations begin

Why it matters

This will double production capacity and enable new product lines (medium voltage, solar), crucial for future growth.

Yes, H2'FY27, it should start being operational.

Risks & concerns

  • Subdued European market demand

    medium

    Demand softness across industrial, automation, and power infrastructure, partly due to government spending shifting to defense, though early signs of pick-up are noted.

    Management acknowledged

  • High-pressure die-casting segment transition

    medium

    Gradual reduction of exposure to automotive and increasing focus on non-automotive, leading to near-term softness and longer qualifying cycles for new opportunities.

    Management acknowledged

  • Trade policy and tariff uncertainties

    medium

    Uncertainty around the actual implementation and impact of new trade agreements (India-EU FTA, India-US Trade Arrangement), specifically the 18% flat duty on Indian exports to the US.

    Management acknowledged

Q&A highlights

6 direct
Alucast business outlook and timeline for improvement Direct
in this financial year, as we spoke before also, in H1, we still had these automotive clients which were giving us some volumes, but we had made some correction to their prices in order to have an agreement that until they phase out and all this phase out is unfortunately happened to China, nothing has happened in Europe. So, this was a phase out. Now, to fill in that, there is a very strong engagement with the market, both non-automotive mostly and also with automotive where we want to really look at non-electrical kind of parts, etc., So, there is a lot of things which are happening. We are working on three, four big contracts and many, many smaller contracts which are there, but by virtue of nature, it is going to take some time... our target is to keep the EBITDA between around 5%.

Provides detailed context on the Alucast segment's challenges, transition strategy, and specific financial targets (revenue decline, 5% EBITDA) for FY27, and a timeline for new projects.

Asked by Prateek Giri

India business growth drivers and outlook Direct
See, it is because our business is also very much scattered and some of the businesses which come in this are also project type in nature. So, we had not so good quarters, first and second, third quarter is good, fourth also is looking promising. So, it is coming up... for the next year, we have planned for India business itself, close to 30%

Explains the reasons for flat India business growth in Q3, outlines new product opportunities (Cam Switches, Solar, TMI), and provides a strong growth target (30%) for the India business next year.

Asked by Prateek Giri

Nashik CAPEX commercialization timeline Direct
Yes, H2'FY27, it should start being operational... So, those product development and the building will be ready, and we will start expanding there. That is one. And solar also, we want to grow more. So, we need space and all of that. So, we are also setting up fully automated production line so that the production efficiencies will be similar or we beat Chinese... In H2'FY27, that CAPEX will be operational.

Provides a clear timeline for the new Nashik facilities to become operational and details the strategic products (medium voltage, solar) that will leverage this expanded capacity.

Asked by Prateek Giri

Sustainability of margin improvement Direct
Yes, I mean, this is something which I try to touch in my speech also. First of all, I would like to very confidently say that these are sustainable margins because these have not come out of any one-off event, they have come out of very systematic improvement in many things. So, one is sourcing... Second one is we introduced a lot of automation in our manufacturing processes... And then the whole operations structure and team is reorganized... And we also did some CAPEX in order to reduce the OPEX.

Management provides a detailed explanation of the multiple, sustainable drivers behind the significant margin expansion, including sourcing, automation, operational efficiencies, and pricing adjustments.

Asked by Ankit Gupta

Impact of India-US trade arrangement on import duties Partial
No, that was the position before all these things happened. But now Trump has put a flat duty on each country for every product. So, from India, no product has remained as far as I know... now everything which is exported from India, will have a 18% duty... but nevertheless there is an 18% flat duty. So, those times where the duty was zero per cent are gone.

Clarifies the current tariff situation for Indian exports to the US, indicating that the previously zero-duty regime is gone and a flat 18% duty now applies, despite recent trade agreements. This is a critical update on trade friction.

Asked by Madhur Rathi

Overall company growth vs. EI segment growth Direct
I would say do not mix up the two. See, aluminum, we have given you a separate number and electrical we have given you a separate number and keep it like that. They are so different, margins are so different that when you add it up, you really do not land up coming to any conclusion. So, do it as two separate businesses, which they actually are, and that will give you a better visibility than when you combine the two numbers.

Management advises analysts to analyze the Electrical & Electronic Instrumentation (EEI) and Alucast segments separately due to their differing dynamics and margin profiles, highlighting the distinct investment theses for each.

Asked by Nishita

Margin profile of new products (solar inverter, EMS) Direct
Yes, it is right. So, those EMS business and solar businesses are relatively lower margin businesses... EBITDA as a percentage, absolute numbers, of course, they will increase, but EBITDA as a percentage may dilute by a few couple of percentage points. But, at the end of the day, as investors, you will be looking at the bottom-line numbers, I mean, that is something which should be mattering. So, it is a mix of things. You are right. That will dilute by a few percent our EBITDA as a percentage of turnover.

Management clarifies that while new EMS and solar businesses will drive top-line growth and ROCE, their lower margin profile might slightly dilute the overall EBITDA percentage, though absolute EBITDA will increase. This provides nuance on future margin expectations.

Asked by Madhur Rathi

3 min read 7 chapters

Detailed narrative

Q3 FY26 Financial Performance & Margin Expansion

Rishabh Instruments reported a consolidated revenue of ₹1,836 million in Q3 FY26, a modest 1.3% YoY growth. However, profitability saw significant improvement, with consolidated EBITDA surging 119.5% YoY to ₹314 million, leading to an EBITDA margin of 17.1%, up 920 basis points from Q3 FY25. Consolidated PAT also increased by 162% YoY to ₹205 million. The company's adjusted EBITDA for the nine-month period reached ₹100.9 crores, already achieving the full-year guidance set at the beginning of FY26.

Strategic Policy Tailwinds & Export Focus

Management highlighted three key policy milestones: the India-European Union Free Trade Agreement, the Union Budget, and the advancement of the India-U.S. Trade Arrangement. These developments are expected to strengthen India's manufacturing and export ecosystem, improving trade access to the EU and U.S. and enhancing export competitiveness. The government's focus on SMEs, labor-intensive manufacturing, and the proposed ISM 2.0 program for electronic components (₹40,000 crores outlay) are seen as positive structural tailwinds for Rishabh's manufacturing-led growth strategy. Despite these positive developments, the company noted that the previously zero-duty regime for Indian exports to the US is gone, with a flat 18% duty now applicable.

Electrical & Electronic Instrumentation (EEI) Segment Performance

The Electrical and Electronic Instrumentation (EEI) segment, a primary growth driver, delivered a 17.7% YoY growth in Q3 FY26. This segment achieved an adjusted EBITDA margin of 26.6%, surpassing the benchmark of 25%. This strong performance was attributed to a robust product portfolio, favorable product mix, sustained operational efficiency, new product launches, and expanding geographic reach. The company remains confident in achieving 15%-20% top-line growth in this segment by the end of the fiscal year.

High-Pressure Die-Casting (Alucast) Segment Transition

The high-pressure die-casting (LUMEL Alucast) segment is undergoing a deliberate transition, gradually reducing exposure to the automotive sector and increasing focus on non-automotive customers. This transition resulted in a 29.1% YoY revenue decline in Q3 FY26 to ₹448 million, and an adjusted EBITDA loss of ₹16 million. Management expects near-term softness to continue but aims to manage the business at break-even EBITDA levels. For FY27, Alucast is projected to have revenues of ₹150-160 crores with a 4-5% EBITDA margin, with a target of double-digit EBITDA by FY28 as new non-automotive projects materialize.

Solar Business Growth & Profitability

The solar business has sharpened its focus and execution, now operating profitably after a period of losses. The segment is witnessing healthy month-on-month demand, and Rishabh recently secured new orders for its single-phase inverter model. For the current fiscal year, the solar business is expected to generate ₹10-12 crores in revenue. The company aims for sustainable growth of 20-50% over the next three years, with initial growth rates potentially reaching 50-100%.

Capacity Expansion & R&D Initiatives

Work on the Nashik facilities, including two new multi-storied buildings, is progressing as planned and is nearing completion. These facilities are expected to double production capacity and become operational in H2 FY27, supporting rising export demands and long-term growth. R&D remains a strategic priority, with teams across LUMEL, Rishabh, and V&A working on multiple product development initiatives. A five-year strategic roadmap targets generating incremental revenue of up to 50% of current electronic turnover through new product lines, including expansion into the medium-voltage segment.

Geographic Diversification & Market Expansion

Beyond Europe, Rishabh is actively expanding its footprint across emerging markets in the Middle East, Africa, and South America, where significant untapped potential is identified. The company is leveraging its existing sales network to accelerate market penetration. In the US market, Rishabh achieved 50% growth this year, reaching $3 million in revenue, and aims to grow this to $5-10 million in a few years. The India business is also expected to grow by close to 30% next year, driven by new opportunities in Cam Switches, Solar, and Test & Measurement Instruments.

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