Detailed Narrative
Overall Financial Performance and Resilience
Rishabh Instruments reported a consolidated revenue growth of 4% YoY for FY25, reaching ₹7,203 million, with Q4 FY25 revenue at ₹1,875 million, up 5% YoY. Despite a complex and dynamic business environment, the company demonstrated resilience. However, consolidated adjusted EBITDA for FY25 declined 33% YoY to ₹640 million, with a margin of 8.9%, primarily due to product mix changes and headwinds in the Lumel Alucast business. Consolidated PAT for FY25 was ₹212 million, down 47% YoY.
Strong Performance in Electronics Segments
The electronics business, comprising Rishabh India and Lumel SA, showed robust performance. Rishabh India's standalone revenue grew 15.8% in Q4 FY25 and 6.5% in FY25 to ₹2,392 million, driven by a 19% growth in domestic sales. Lumel SA (Poland) recorded a 14% revenue growth in FY25 to ₹1,989 million, achieving a strong EBITDA margin of 20.4% and PAT growth of 47.5%. Management anticipates continued strong growth for FY26, targeting 20% for Rishabh India domestic sales, 12-13% for exports, and 14-15% for Lumel SA.
Lumel Alucast Turnaround Strategy and Challenges
The die-casting business, Lumel Alucast, continued to face challenges, with FY25 revenue declining 2.7% to ₹2,636 million and an adjusted EBITDA loss of ₹150 million (5.7% margin). However, Q4 FY25 showed an improvement, reaching 0.2% adjusted EBITDA. The company is strategically reducing its exposure to low-margin automotive contracts (from 40-45% to 20-25%) and focusing on higher-value non-automotive applications and new customer acquisition to achieve positive EBITDA in FY26. Monthly breakeven for Lumel Alucast is estimated at PLN 8-8.5 million turnover with 18% gross margin.
Significant R&D and New Product Development
Rishabh Instruments is heavily investing in R&D, culminating in a clear 5-year product roadmap. Upcoming launches include Solar UNO (single-phase inverter) and mid-range inverters in Q1 FY26, and an advanced full-class A power quality analyzer (ND50) by end of FY25. The company also acquired 100% shares of MICROSYS, a Czech Republic-based company specializing in SCADA software development, in August 2024, to offer comprehensive solutions. These initiatives are expected to generate incremental revenue equivalent to nearly 50% of total electronic sales from the roadmap.
Capacity Expansion and Operational Efficiency
The company is expanding its manufacturing footprint with two new buildings in Nashik, adding 67,000 sq ft and 82,000 sq ft, increasing the built-up area by 110%. New state-of-the-art SMT lines have been installed at both Rishabh and Lumel SA facilities, enhancing production capacity and precision for high-quality electronic assembly and EMS business. A 1.5-megawatt solar plant was commissioned at Lumel Alucast to reduce energy costs and carbon footprint, aligning with sustainability goals.
Capital Structure and Liquidity
Rishabh Instruments maintains a strong balance sheet and remains net debt-free, with net cash and cash equivalents of ₹1,022 million as of March 31, 2025. The company generated a healthy cash flow from operations of ₹650 million. Planned capital expenditure for the next two years is estimated at ₹70-80 crores, primarily allocated for building expansion in Rishabh India (₹50-60 crores) and new SMT lines in Lumel SA (₹15-20 crores), demonstrating a commitment to future growth and operational readiness.