Detailed Narrative
Robust Financial Performance and Profitability Turnaround
Rishabh Instruments delivered a strong financial performance in FY26, with consolidated EBITDA more than doubling to INR1,264 million, a 161.1% YoY increase. The consolidated EBITDA margin expanded significantly by 960 basis points to 16.3%. A key highlight was the turnaround of the Lumel Alucast business, which achieved an adjusted EBITDA of INR33 million in FY26, a substantial improvement from a loss of INR150 million in the previous year, despite a 9.6% YoY revenue decline.
EEI Segment Drives Growth and Margin Expansion
The Electrical and Electronics Instrumentation (EEI) segment continued to be the primary growth engine, recording a 17.5% growth in FY26. Management guided for a 20-25% top-line growth and a 20-22% EBITDA margin for the EEI business in the coming year. Both Rishabh standalone and Lumel SA are expected to grow at similar rates, while smaller entities in the USA, China, and UK are projected to achieve around 30% growth.
Strategic Capacity Expansion and New Product Development
The company completed its Nashik expansion capex, with two new manufacturing facilities now under commissioning, which will effectively double production capacity. This expansion is crucial for supporting organic growth and meeting rising demand. Rishabh is also aggressively investing in R&D, with new medium voltage products like CTs, PTs, and VTs expected to be ready by year-end, with sales commencing next year, further expanding its addressable market.
Solar Inverter Business and US Market Focus
The solar inverter business has become operationally profitable, with successful launches of single-phase iUNO inverters gaining strong market acceptance. Management targets INR25 crores from this segment in the next financial year and anticipates 40-50% growth for the US solar business. For the broader US market, Rishabh aims to achieve INR100 crores in revenue within 2-3 years, necessitating significant investment in UL certification and product redesign to meet local standards.
Capital Allocation and Shareholder Returns
Rishabh Instruments maintains a strong balance sheet, being net debt-free with net cash and cash equivalents of INR1,276 million as of March 31, 2026. In recognition of the strong performance, the Board declared a final dividend of INR2 per share (20% on INR10 share capital). While the company continuously evaluates inorganic growth opportunities, no significant M&A activity was announced during the quarter.
Navigating Global Headwinds and Long-term Opportunities
The company acknowledged a dynamic global environment characterized by war, tariff impositions, and supply chain disruptions. Despite these challenges, Rishabh's disciplined operating model and diversified business helped it achieve resilient performance. Management remains optimistic about long-term growth, driven by government focus on manufacturing, renewable energy, and infrastructure in India, and increasing investments in power infrastructure and industrial automation in markets like the US, Southeast Asia, and Africa.