S.J.S. Enterprises Limited — Q1 FY26 earnings call

Call held 30 Jul 2025

Management summary

SJS Enterprises reported a robust Q1 FY26, driven by strong performance in its automotive segments, particularly 2-wheelers and passenger vehicles, significantly outpacing industry growth. Profitability remained healthy with expanded EBITDA and PAT margins. The company is actively pursuing capacity expansion projects and strategic customer additions, while addressing temporary softness in the Walter Pack segment due to product concentration and model changes.

Highlights

  • Consolidated revenue reached ₹209.66 crores, marking an 11.2% Y-o-Y growth.

  • Automotive business (2W & 4W) delivered a strong 22.8% Y-o-Y growth, significantly outperforming the industry's 1.2% growth.

  • EBITDA stood at ₹58.72 crores, growing 16.3% Y-o-Y, with EBITDA margins expanding to 27.6%.

  • PAT increased by 22.6% Y-o-Y to ₹34.62 crores, achieving a PAT margin of 16.5%.

  • The company generated strong free cash flows of ₹32.56 crores, resulting in a net cash position of ₹131.14 crores.

  • Annualized ROCE was 29.5% and ROE was 19.1%, reflecting strong financial performance.

  • Exports contributed 6.7% (₹14.09 crores) to consolidated revenue, with expectations to bounce back from Q2 FY26 onwards.

Key financials

  1. Consolidated Revenue ₹209.66 Cr +11.2%YoY
  2. EBITDA ₹58.72 Cr +16.3%YoY
  3. EBITDA Margin 27.6%
  4. PAT ₹34.62 Cr +22.6%YoY
  5. PAT Margin 16.5%
  6. Free Cash Flow ₹32.56 Cr
  7. Net Cash Position ₹131.14 Cr
  8. ROCE (Annualized) 29.5%
  9. ROE (Annualized) 19.1%
  10. Exports Revenue ₹14.09 Cr
  11. Exports Contribution 6.7%

What they filed

Q1 FY27: revenue up 24.3%, net profit up 111.4% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue193 179 201 210 242 +25%244 +36%260 +29%261 +24%
EBITDA50 45 51 56 68 +36%71 +58%75 +47%75 +34%
Net profit29 28 34 35 43 +48%45 +61%49 +44%74 +111%
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

SegmentY-o-Y GrowthRevenue Share
Automotive Business (2W & 4W)22.8%—
2-Wheeler Segment32.7%39.1%
Passenger Vehicle Segment13.8%37.2%
Consumer and Others Segment—23.6%
New Technology Products——

Guidance & targets

Volume

  • Overall Industry Growth Outperformance Volume · whole year · High confidence over 2x
    at SJS, we are confident of outperforming the underlying industry growth by over 2x.

    — Sanjay Thapar, Group CEO and Executive Director

Export Revenue

  • Exports Contribution to Consolidated Revenue Export Revenue · FY28 · High confidence 14% - 15%
    A key focus of our forward-looking strategy is to expand our global presence with a clear goal of increasing exports to 14% - 15% of our consolidated revenue by the year FY-28.

    — Sanjay Thapar, Group CEO and Executive Director

Capacity

  • SJS Decoplast Plant Operational Capacity · Q3 FY26 · Medium confidence end of Q3

    Previously Q2 end → end of Q3

    So we expect by the end of Q3, we expect that plant to be operational.

    — Sanjay Thapar, Group CEO and Executive Director

Revenue

  • Exotech Incremental Revenue Revenue · FY27 · Medium confidence INR 300 crores to INR400 crores
    So most probably that as we are investing around INR 100 crores and INR300 crores to INR400 crores incremental revenue will come by FY27.

    — Abhishek Kumar Jain, Analyst (paraphrased by Mahendra Kumar Naredi)

  • Walter Pack Business Revival Revenue · next 1 year · Medium confidence 2-3 quarters / roughly a year
    So maybe 2-3 quarters, it would take. So roughly a year from now, you could expect that Walter Pack will be back with some large mega businesses.

    — Sanjay Thapar, Group CEO and Executive Director

  • Hero MotoCorp Business Potential Revenue · long run · Medium confidence INR 250 crores
    the total revenue spend by Hero on such category of products is close to about INR 250 crores, and we hope to have a significant share of that business.

    — Sanjay Thapar, Group CEO and Executive Director

Margin

  • Exotech Margin Margin · ongoing · Medium confidence 18%

    From 12% today

    Look, So margins, historically, chrome plating is a low-margin business. So we acquired this business at 12%. We are today at about 18% - 19% and I think that's a fantastic achievement by the team. I am happy if we continue to be at that 18% margin sort of ballpark number.

    — Sanjay Thapar, Group CEO and Executive Director

  • EBITDA Margin Margin · moving forward · Medium confidence 25%
    I've said that we expect SJS to grow faster than the industry, expect SJS to deliver margins around 25%. I'm very happy that we are at 27%. But the point really is that, look, the idea behind the business is to have a sustainable business, which will grow... moving forward, I'm happy if I continue to grow at a fast pace with a ballpark 25% EBITDA.

    — Sanjay Thapar, Group CEO and Executive Director

Asset Turnover

  • Exotech Asset Turnover Asset Turnover · once facility started · Medium confidence 3 to 4x
    Yes, Abhishek, once we started this facility, the asset turnover would be between 3 to 4x in between...

    — Mahendra Kumar Naredi, Group CFO

Profitability

  • ROCE Profitability · ongoing · High confidence above 20%
    So the golden rule is anything less than 20% is not acceptable.

    — Sanjay Thapar, Group CEO and Executive Director

Capex

  • Expansion Capex (FY26) Capex · FY26 · High confidence INR 40 crores to INR 45 crores
    We have allocated INR 40 crores to INR 45 crores for expansion that's going to happen within the FY26 financial year.

    — Mahendra Kumar Naredi, Group CFO

  • Greenfield Project in Pune (SJS Decoplast) Capex · ongoing · High confidence INR 100 crores
    So we have allocated INR 100 crores out of INR 100 crores, approximately INR 45 crores is already incurred and balance amount to be incurred in another few quarters.

    — Mahendra Kumar Naredi, Group CFO

Product Launch

  • Cover Glass Revenue Start Product Launch · FY27 · High confidence FY27

    From next year today

    Regarding cover glass revenues, we've said that next year is when we see revenues coming into that facility... And supplies would start in FY27. So that's next year.

    — Sanjay Thapar, Group CEO and Executive Director

Risks & concerns

  • Product concentration risk and model changes in Walter Pack

    medium

    Walter Pack's sales were impacted in Q1 FY26 due to dependence on a few customers/models and a model change in the consumer electrical business, leading to a decline in volumes.

    Management acknowledged

  • Global magnet supply chain issues impacting OEM production

    low

    Management stated they have not seen any decline in volumes due to magnet issues, despite press coverage, and are optimistic about solutions.

    Analyst downplayed

  • Tariff issues impacting export orders (Stellantis, Whirlpool)

    low

    Management stated they have started supplies and have not had any issues with them so far, without directly addressing the tariff impact.

    Analyst not addressed

Areas of evasion (1)

  • Specific revenue contribution from Hero MotoCorp (management stated they are a supplier, not buyer, and cannot disclose)

Q&A highlights

3 direct
Walter Pack's underperformance and capacity utilization Direct
The challenge really has been Walter Pack, where we have a legacy set of customers, and there's a large dependence on a few customers and a few models. So those models have not performed well in this quarter, and that has accounted for some decline in revenues in that part of the business.

Reveals specific reasons for weakness in a segment and provides current capacity utilization across different business units.

Asked by Pradyumna Choudhary

Hero MotoCorp ramp-up and Cover Glass strategy Direct
So we started with Hero with a few models. And moving forward, we will gain momentum... we are now looking not only at cover glass, but to do some more value addition in this overall display screen... And supplies would start in FY27.

Clarifies the progress with a new marquee customer and outlines an expanded, more ambitious strategy for the cover glass/display segment with a clear timeline for revenue generation.

Asked by Pradyumna Choudhary

Exotech new plant, export potential, and margins Direct
So most probably that as we are investing around INR 100 crores and INR300 crores to INR400 crores incremental revenue will come by FY27... I am happy if we continue to be at that 18% margin sort of ballpark number. Of course, when we add exports, I expect that margin to increase.

Provides specific financial targets (revenue, margin, asset turnover) for a key capacity expansion project and highlights the strategic importance of exports for margin improvement.

Asked by Abhishek Kumar Jain

3 min read 6 chapters

Detailed narrative

Strong Q1 FY26 Performance Driven by Automotive Growth

SJS Enterprises commenced FY26 on a positive note, delivering its 23rd consecutive quarter of outperformance. The company achieved a consolidated revenue of ₹209.66 crores, marking an 11.2% Y-o-Y growth. This was primarily fueled by the automotive business (2-wheeler and 4-wheeler), which grew by a phenomenal 22.8% Y-o-Y, significantly surpassing the overall industry growth of 1.2%. The 2-wheeler segment saw a 32.7% Y-o-Y growth, while passenger vehicles grew by 13.8% Y-o-Y.

Robust Profitability and Cash Generation

The company demonstrated robust profitability with EBITDA growing 16.3% Y-o-Y to ₹58.72 crores, and EBITDA margins expanding to 27.6%. PAT increased by 22.6% Y-o-Y to ₹34.62 crores, achieving a PAT margin of 16.5%. SJS generated strong free cash flows of ₹32.56 crores during the quarter, leading to a net cash position of ₹131.14 crores. The company's focus on operational efficiencies and working capital management resulted in operating cash flows amounting to 101% of EBITDA, with annualized ROCE at 29.5% and ROE at 19.1%.

Strategic Capacity Expansion and New Customer Acquisitions

Aligned with its growth strategy, SJS is undertaking infrastructure development for capacity expansion at Pune and Bangalore. The greenfield project at SJS Decoplast in Pune, involving an investment of ₹100 crores, is expected to be operational by the end of Q3 FY26, with ₹45 crores already incurred. The company also allocated ₹40-45 crores for other expansions in FY26. SJS successfully added Hero MotoCorp as a marquee customer, with supplies commencing in Q1 FY26, and secured export wins from Autoliv and Fiat Chrysler Automobiles in the U.S. market, as well as Yazaki for domestic automotive business.

Walter Pack Challenges and Diversification Efforts

The Walter Pack segment experienced some softness in Q1 FY26, primarily due to product concentration risk, dependence on a few customers/models, and a model change in the consumer electrical business. Management indicated that exports were largely flat but are expected to bounce back from Q2 FY26 with deliveries for Whirlpool and Stellantis orders. The company is actively working to diversify Walter Pack's customer base and product portfolio, expecting a revival in 2-3 quarters or roughly a year.

Expanding Global Footprint and Export Targets

SJS is focused on accelerating organic growth through continuous innovation, capacity expansion, and deepening global engagement. Exports contributed 6.7% (₹14.09 crores) to consolidated revenue in Q1 FY26. The company has a clear goal of increasing exports to 14-15% of consolidated revenue by FY28, actively entering new international markets and penetrating existing ones with differentiated products tailored to global customer needs. New export wins from Stellantis, Whirlpool, Autoliv, and FCA are expected to contribute to this growth.

Advanced Display Solutions and Cover Glass Ambition

SJS is expanding its ambition in the cover glass segment beyond just cover glass to encompass the overall display screen, seeing it as a huge potential. The company is firming up its entry strategy, including evaluating technology partnerships, and expects supplies for cover glass to commence in FY27. This product-led approach focuses on enhancing aesthetics with added features, allowing SJS to deliver differentiated value and stay ahead of industry trends.

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