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    Schneider Elect.

    SCHNEIDER
    Capital Goods·29 May 2026
    Management Summary

    Schneider Electric Infrastructure Limited reported strong annual growth for FY26 across orders, sales, and profit, with a significant increase in its order backlog. However, Q4 FY26 saw flat sales and gross margin compression, mainly attributed to geopolitical headwinds, commodity price volatility, and customer-requested delivery deferrals. The company is strategically focusing on high-growth areas like energy transition, data centers, and manufacturing, while implementing hedging strategies and selective order booking to manage risks.

    Highlights

    5

    • Orders growth of 27.4% YoY for FY26, indicating strong demand.

    • Sales growth of 9.6% YoY for FY26, demonstrating consistent execution.

    • Profit growth of 10.1% for FY26, reflecting overall business health.

    • Order backlog increased 50% YoY, providing good revenue visibility.

    • Recognized with Golden Peacock Awards for ESG 2025 and Innovative Products/Services 2026.

    Concerns

    4

    • Q4 FY26 sales were flat at INR 590 crores, impacted by delivery deferrals and external factors.

    • Gross margin dropped by 1.5-1.6% in Q4, primarily due to commodity price increases (2.5% impact).

    • Raw material prices, specifically copper (+30%) and steel (+10%), increased significantly in the last 12 months.

    • Low Q4 order intake due to selective booking amidst commodity market uncertainty.

    Key financials

    Metrics

    9

    Periods

    2

    Q4

    5
    • Sales
      ₹590 Cr
    • Profit Margin
      6%
    • Gross Margin
      36.6%
    • Gross Margin Drop
      1.5%
    • Exceptional Item (Labour Code)
      ₹14 Cr

    FY26

    4
    • Orders Growth
      27.4%
      YoY+27.4%
    • Sales Growth
      9.6%
      YoY+9.6%
    • Profit Growth
      10.1%
      YoY+10.1%
    • Gross Margin
      37.5%

    Order Book

    medium confidence

    Composition

    Data Centers(client type)
    10.0%

    Cancellations / Deferrals

    • deferred:10-12% of Q4 sales deferred to next quarter due to customer dependencies and geopolitical crisis.

    "Order backlog is strong, but Q4 order intake was low due to selective booking amidst commodity market uncertainty and customer deferrals."

    Source:
    Prepared remarks

    Guidance & targets

    11
    CategoryTargetPriority
    Government Capex
    Government Capex Increase
    11.5% higher
    		High
    Power Utilities
    Central Utilities Financial Outlay Increase
    20% up
    		High
    Energy Transition
    Per Capita Energy Consumption Increase
    30% up
    		High
    Energy Transition
    Energy Consumption CAGR
    12% to 15%
    		High
    Energy Transition
    Non-Fossil Fuel Capacity Target
    500 gigawatts
    		High
    Energy Transition
    Non-Fossil Fuel Capacity Achieved
    280 gigawatts
    		High
    Energy Transition
    Energy Storage System (ESS) Growth
    210 to 240 gigawatt hours
    		High
    Transportation
    EV Penetration Plan
    30%
    		High
    Transportation
    Vande Bharat Trains Target
    400 trains
    		High
    Digitalization
    Data Center IT Load Target
    8 gigawatts
    		High
    Order Book
    Data Center Contribution to Order Backlog
    10% to 12%
    		High

    Resolution of Q4 Delivery Deferrals

    next quarter (Q1 FY27)
    Current10-12% of Q4 sales (INR 59-70.8 crores) deferred
    TargetImproved sales growth and recovery of deferred orders in Q1 FY27

    Why it matters

    Indicates the company's ability to convert its backlog and overcome execution challenges from external factors.

    Okay. And do you think that will get rectified in this quarter? ... Finger crossed, sir. I think that's why we are looking at and I heard the news yesterday again that there's some again, some prices going to come from U.S. So I don't know. I'm that's keep the finger crossed that all the essential LPG copper issues are getting solved. So I hope that will recover in Q1.

    How to verify

    key_financials.metrics[label='Q1 Sales'].yoy_growth

    Risks & concerns

    5
    RiskSeverity

    Raw Material Price Volatility

    Copper prices increased 30%+ and steel prices 10%+ in the last 12 months, impacting gross margins by 2.5% in Q4. — Management acknowledged

    high

    Geopolitical Uncertainties

    External geopolitical reasons contributed to Q4 being an abnormal quarter and led to customer-requested delivery deferrals. — Management acknowledged

    medium

    Forex Fluctuations

    Mentioned as a headwind, though the company employs hedging strategies (PO hedging, net ARAP hedging) to mitigate impact. — Management acknowledged

    low

    Execution Delays/Customer Deferrals

    Customer-requested deferrals, accounting for 10-12% of Q4 sales, impacted revenue recognition due to their own LPV dependencies and geopolitical crises. — Management acknowledged

    medium

    Gross Margin Pressure

    Gross margin dropped by 1.5-1.6% in Q4 due to commodity price increases and a shift in service mix towards lower-margin modernization projects. — Management acknowledged

    medium

    Q&A highlights

    8

    “I think the first solution, which is towards modernization of grid in the country is by us, which has been running in one of the South states since 2012. And I think what we see as where India is moving to is driving robustness and modernizing grid. ... So we have software, which we call as microgrid solutions, which actually takes care of that flow. ... Another solution we have on the software, which I was explaining you if you might have understood is the One Grid Platform, which integrates 3, 4 elements which comes together on the grid solution.”

    Highlights the company's strategic focus and specific solutions for future growth areas like grid modernization and microgrids.

    asked by Sucrit D Patil

    2 min read5 chapters

    Detailed Narrative

    01

    Strong Annual Performance Despite Q4 Headwinds

    Schneider Electric Infrastructure Limited reported robust annual growth for FY26, with orders up 27.4%, sales increasing by 9.6%, and profit growing by 10.1%. The company's order backlog also saw a significant 50% year-over-year increase, indicating strong future revenue visibility. However, Q4 FY26 presented challenges, with sales remaining flat at INR 590 crores and gross margins compressing to 36.6% from 39.1% in FY25, primarily due to external geopolitical factors and commodity price volatility.

    02

    Gross Margin Pressure from Commodity Prices and Mix

    The company experienced a 1.5-1.6% drop in gross margin in Q4, with commodity price increases, particularly copper (up 30%+) and steel (up 10%+) over the last 12 months, accounting for a 2.5% impact. Management noted that while they employ hedging strategies for forex and commodities, the unprecedented🌐 market conditions led to margin pressure. They also highlighted a shift in service mix towards lower-margin modernization projects as a contributing factor to the overall FY26 gross margin of 37.5%.

    03

    Strategic Focus on High-Growth Segments

    Schneider Elect. is actively leveraging opportunities in India's energy transition, transportation, digitalization (AI-driven), and manufacturing sectors. Key growth areas include the non-fossil fuel segment, targeting 500 GW (280 GW already achieved), and energy storage systems, projected to grow from 1 GWh to 210-240 GWh by 2030/2032. The company is also positioning itself in the rapidly expanding data center market, which is expected to reach 8 GW by 2030, with 10-12% of its current order backlog attributed to this segment.

    04

    Innovation and Digitalization Initiatives

    The company showcased its EcoStruxure XR Operator Advisor, a new offer for industrial asset maintenance, and the One Digital Grid tool, which uses AI to optimize grid efficiency and asset management for DISCOMs. They are also introducing a new 33 kV dry-type transformer (Trihal) for data centers, metros, and commercial buildings, emphasizing its robust endurance and seismic compliance. These innovations aim to enhance customer site management and operational efficiency, contributing to the vision of an advanced energy world.

    05

    Selective Order Intake and Execution Challenges

    In Q4, the company adopted a selective approach to order intake, prioritizing orders with favorable terms amidst commodity market uncertainty🌐, resulting in lower new bookings. Sales execution was impacted by customer-requested deferrals, with 10-12% of Q4 sales (INR 59-70.8 crores) being pushed to subsequent quarters due to customers' own dependencies and geopolitical crises. Management emphasized careful dispatch management to ensure profitability and cash flow, rather than simply chasing revenue, and hopes for rectification of these delays in Q1 FY27.

    This is an AI-generated summary of a publicly available earnings call transcript. It is for informational purposes only and does not constitute investment advice, a recommendation, or an endorsement. inve.money is not a SEBI-registered investment advisor. Please consult a qualified financial advisor before making any investment decisions.