Servotech Renewable Power System Limited — Q4 FY25 earnings call

Call held 7 May 2025

Management summary

Servotech Renewable reported robust financial performance for Q4 FY25 and the full fiscal year, driven by strong growth in both consolidated and standalone metrics. The company is strategically pivoting towards solar energy, with ambitious capacity expansion plans and backward integration into solar PV manufacturing, while also expanding internationally. Despite challenges in the EV charging infrastructure, management highlighted operational efficiencies and a focus on solar to maintain growth momentum.

Highlights

  • Consolidated total revenue for FY25 surged by 91% to ₹67,680.0 lacs.

  • Consolidated EBITDA for FY25 increased by 159.05% to ₹5,793.8 lacs.

  • Consolidated PAT for FY25 grew by 176.5% to ₹3,263.7 lacs, with PAT margins improving to 4.8% from 3.3%.

  • Consolidated total revenue for Q4 FY25 grew by 7.9% to ₹14,746.0 lacs.

  • Consolidated EBITDA for Q4 FY25 rose by 121% to ₹1,338.0 lacs.

  • Consolidated PAT for Q4 FY25 demonstrated strong growth of 123.4% to ₹771.6 lacs.

  • Standalone total revenue for FY25 increased by 91.8% to ₹58,910.9 lacs.

  • Servotech Renewable signed an agreement with France-based Watt & Well to develop and manufacture EV charger components in India.

Concerns

  • EV market saturation and infrastructure issues

Key financials

2 periods

Q4 FY25

  • Consolidated Revenue
    14,746 lacs
    YoY +7.9%
  • Consolidated EBITDA
    1,338 lacs
    YoY +121%
  • Consolidated PAT
    771.6 lacs
    YoY +123.4%

FY25

  • Consolidated Revenue
    67,680 lacs
    YoY +91%
  • Consolidated EBITDA
    5,793.8 lacs
    YoY +159.1%
  • Consolidated PAT
    3,263.7 lacs
    YoY +176.5%
  • Consolidated PAT Margin
    4.8%

What they filed

Q1 FY27: revenue up 57.8%, net profit up 77.1% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue200 216 146 137 106 −47%211 −2%217 +49%216 +58%
EBITDA19 16 12 10 6 −67%28 +73%23 +85%20 +96%
Net profit11 9 8 5 0 −97%16 +69%11 +45%8 +77%
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.

Guidance & targets

Capital Raise

  • Preferential Allotment Capital Raise · June or July · Medium confidence ₹200 crores
    Yes, the plan is in place, but the current market situation is not very favorable. So, strategically, we will wait for a bit before proceeding.

    — Raman Bhatia, Founder & Managing Director

Capacity

  • Initial Solar PV Manufacturing Capacity Capacity · near-term (disclosure in May) · High confidence 150-200 megawatts
    Our target is to disclose it in May, and its initial capacity is currently 150-200 megawatts.

    — Raman Bhatia, Founder & Managing Director

  • Future Solar PV Manufacturing Capacity Capacity · future (after initial phase and new plant) · Medium confidence 1 gigawatts
    However, we are also planning to set up a new plant with the company, and then our capacity will increase to 1 gigawatts. As soon as that happens, we will act immediately. Sir, this will be done in two phases.

    — Raman Bhatia, Founder & Managing Director

Manufacturing

  • Solar Cell Manufacturing Manufacturing · 2026-27 · High confidence —
    And let me also tell you one more thing — we've already started working on the government's plans for 2026-27. That means we've also begun work on cell manufacturing for solar panels.

    — Raman Bhatia, Founder & Managing Director

Market Expansion

  • International Presence (EVs) Market Expansion · ongoing · High confidence more countries

    From 15 countries today

    Additionally, for EVs, we are working internationally, having already entered 15 countries, and we are aiming to expand into more countries.

    — Raman Bhatia, Founder & Managing Director

Risks & concerns

  • EV market saturation and infrastructure issues

    high

    DISCOMS lack infrastructure for power connections, leading to 40% of chargers remaining uninstalled and delayed payments, causing an overall slowdown in the EV business.

    Management acknowledged

  • Increased debtor cycle time

    medium

    Debtor cycle time has increased slightly, though management states overall operational improvements have mitigated its impact.

    Management acknowledged

Q&A highlights

3 direct
Preferential allotment of ₹200 crores Direct
Yes, the plan is in place, but the current market situation is not very favorable. So, strategically, we will wait for a bit before proceeding.

Reveals a planned capital raise is delayed due to market conditions, impacting future funding.

Asked by Jay Padmani

Appointment of Errol Musk and business expansion plans for EV charging and solar energy Direct
We have a very ambitious target. Along with this, we are planning to expand into international markets. We are trying to tap into African countries and also some areas in the US. They'll help us both strategically and geographically.

Highlights the strategic rationale behind a high-profile advisory board appointment and the company's international growth ambitions.

Asked by Naman Sharma

Issues from OMCs side and the future of the EV charging market in India Direct
The biggest problem in India right now is that DISCOMS do not have the infrastructure to provide power connections. Because of this, 40% of the chargers that were given are still not installed, and since they haven't been installed, the payments have been delayed. Now, this has caused a hit on the business, but we'll make sure we get the payments from them because we've delivered the goods, so the money will come to us.

Provides critical insight into the current infrastructure bottlenecks and payment delays affecting the EV charging business, explaining the company's pivot to solar.

Asked by Jay Padmani

2 min read 6 chapters

Detailed narrative

Strong Financial Performance in Q4 FY25 and Full Year FY25

Servotech Renewable reported impressive financial results for Q4 FY25 and the full fiscal year. Consolidated total revenue for FY25 surged by 91% to ₹67,680.0 lacs, with EBITDA increasing by 159.05% to ₹5,793.8 lacs and PAT growing by 176.5% to ₹3,263.7 lacs. PAT margins improved to 4.8% from 3.3% year-over-year. For Q4 FY25, consolidated revenue grew by 7.9% to ₹14,746.0 lacs, EBITDA by 121% to ₹1,338.0 lacs, and PAT by 123.4% to ₹771.6 lacs, demonstrating robust growth momentum.

Strategic Pivot to Solar Energy and Backward Integration

The company is making a strategic pivot towards solar energy, aiming for deeper impact through domestic manufacturing and innovation. Servotech plans to disclose an initial solar PV manufacturing capacity of 150-200 megawatts in May, with a future target to expand to 1 gigawatt through a new plant in two phases. Furthermore, the company has already initiated work on cell manufacturing for solar panels, aligning with government plans for 2026-27. This focus has led to a significant increase in monthly solar business, from ₹7-8 crores to ₹20-25 crores.

Challenges in EV Charging Infrastructure and Mitigation

Management acknowledged saturation in the EV market primarily due to infrastructure issues, particularly the inability of DISCOMS to provide timely power connections for large systems. This has resulted in 40% of supplied chargers remaining uninstalled and subsequent delays in payments. To mitigate the impact of this slowdown on Servotech, the company has shifted its focus towards solar energy, expanding its distribution and channels, which have approximately doubled in the last six months.

International Expansion and Advisory Board Appointment

Servotech Renewable is pursuing an ambitious international expansion strategy, targeting African countries and parts of the US. The recent appointment of Errol Musk to the advisory board is expected to provide strategic and geographical assistance, enhancing the company's exposure and networking opportunities. The company is already operating in 15 countries for its EV business and aims to expand into more.

Operational Efficiencies and Digital Transformation

The company has implemented operationally cost-effective approaches, significantly improving profitability by minimizing inventory and controlling debtors. These efforts are expected to yield even better results in the first quarter. Servotech is also investing in digital transformation initiatives, including the rollout of SAP and Zoho CRM systems, AI-powered reporting, and IoT-based energy derivatives, to enhance operational capabilities and maintain steady growth.

Railway Sector Opportunities in Solar

Servotech Renewable has secured multiple contracts from the Indian Railways for solar rooftop projects, including orders from North Eastern Railway and ongoing work with Eastern and Central Railways. The company views the railway sector as a significant growth area for its solar business, with plans to actively participate in upcoming tenders and projects. Management indicated having secured more than 5 contracts in this sector already.

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