T R I L — Q4 FY25 earnings call

Call held 8 Apr 2025

Management summary

Transformers and Rectifiers (India) Limited delivered a strong Q4 and full-year FY25, marked by record production, significant revenue and profit growth, and robust order inflows. The company made strategic advancements in backward integration and capacity expansion, while also strengthening its balance sheet with reduced debt and improved working capital. Management expressed confidence in achieving its US$1 billion revenue target within three years, driven by a healthy order pipeline and operational efficiencies.

Highlights

  • FY25 Standalone Revenue grew 53% to ₹1,950 crores, exceeding ₹2,000 crores guidance on a consolidated basis (₹2,051 crores).

  • FY25 Standalone EBITDA increased 149% to ₹320 crores, with margins improving to 16.12%.

  • PAT for FY25 Standalone jumped 325% to ₹187 crores, with PAT margin at 9.45%.

  • Unexecuted order book reached ₹5,132 crores as of March 31, 2025, ensuring 15-18 months of revenue visibility.

  • Debt-to-equity ratio significantly reduced to 0.2% from 0.84%, and debtor days improved to 114 from 156.

Key financials

  1. Standalone Revenue ₹1,950 Cr +53%YoY
  2. Consolidated Revenue ₹2,051 Cr
  3. Standalone EBITDA ₹320 Cr +149%YoY
  4. Standalone EBITDA Margin 16.1%
  5. Standalone PAT ₹187 Cr +325%YoY
  6. Standalone PAT Margin 9.4%
  7. Production 29,118 MVAs +77.2%YoY
  8. Debtor Days 114 days

What they filed

Q1 FY27: revenue up 8.1%, net profit down 4.5% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue462 559 676 529 460 −0%737 +32%783 +16%572 +8%
EBITDA69 85 131 88 52 −25%125 +47%118 −10%93 +6%
Net profit46 55 94 67 37 −20%76 +38%91 −3%64 −4%
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.

Order book

high confidence

Total value

₹5,132 Cr

as of 2025-03-31 quantified

Execution

ensuring clear revenue visibility for the next 15 months to 18 months

Composition

Mix 2 client types
  • Utility Business 45%
  • EPC and Other Businesses 55%

Share of order book by client type

The company achieved its highest-ever order inflow of INR4,504 crores in FY25, resulting in a robust unexecuted order book of INR5,132 crores, providing strong revenue visibility for the next 15-18 months. Management targets an order input of INR8,000 crores for FY26.

Source: Prepared remarks

Capital allocation

high confidence
  • Capex ₹550 Cr internal accruals and the QIP proceeds
    • Capacity expansion (15,000 MVA)
    • Capacity expansion (22,000 MVA EHV)
    • Backward integration
    The capital will be instrumental in furthering our backward integration plans and expanding our manufacturing capacities. ... In the next 15 months, the company will be spending INR550 crores on capex expansions to strengthen its organic as well as backward integration growth, with the target to become 100% backward integrated. ... From the internal accruals and the QIP proceeds what we have with us.
  • Debt Debt disclosed
    Debt-to-equity ratio reduced to 0.2% compared to 0.84% last year, reflecting our progress towards becoming a net debt-free company.
  • M&A CRGO processing unit Acquisition · Closed

    achieving 100% backward integration in one of the most critical raw materials

    We proudly completed acquisition of a controlling stake in a CRGO processing unit by achieving 100% backward integration in one of the most critical raw materials, which constitutes of 32%-35% of transformer cost input. ... See, we have taken over a company which was into this business. So, we have taken 51% stake in it.
  • Liquidity Cash ₹500 Cr Raised INR500 crores via QIP, executed in record time, to fund backward integration and manufacturing capacity expansion.
    We also successfully raised INR500 crores via QIP, executed in record time. The capital will be instrumental in furthering our backward integration plans and expanding our manufacturing capacities.

Guidance & targets

Revenue

  • Revenue Revenue · next 3 years · High confidence US$1 billion
    Our long-term vision to become a US$1 billion revenue company within next 3 years remains intact, and we are confident of achieving it through consistent execution and customer-centric innovation and robust financial discipline.

    — Satyen Mamtora

Profitability

  • PAT Level Profitability · future · High confidence 10%
    Yes, sir. I agree with you, sir. As I guided always, our target is to reach to a 10% PAT level.

    — Chanchal Rajora

  • CRGO Backward Integration Margin Impact Profitability · future · Medium confidence 0.25%
    Sir, it won't increase much of the margins. We may end up having 0.25% on the product basis, but it is going to improve my operational efficiency and quality, which will give me the extra leverage on my production capacity.

    — Chanchal Rajora

Margin

  • EBITDA Margin Margin · year ahead · High confidence 16% to 17%
    But on the futuristic side, the margins what we are showing on a yearly basis will be the guided margins, sir. ... 16% to 17% level, sir.

    — Chanchal Rajora

Working Capital

  • Working Capital Days Working Capital · throughout the year · High confidence around 120 days
    And the working capital what we are showing here, if you have been actually hearing us, we are targeting at the level of around 120 days working capital. And I'm pleased to say that we are quite on that track. And it's a sustainable working capital for throughout the year.

    — Chanchal Rajora

Order Book

  • Order Input Order Book · next financial year · High confidence INR8,000 crores
    So, next financial year, our order book input will be around INR8,000 crores?

    — Satyen Mamtora

  • Export Order Book Size Order Book · future · High confidence around 15%
    And as you have been hearing us that we have targeted to remain around 15% on the export order book size.

    — Chanchal Rajora

Capacity Utilization

  • Utilization Rate Capacity Utilization · next year · High confidence 80%
    Yes, we are currently at 60%-65% utilization. Next year, we should reach about 80% utilization.

    — Satyen Mamtora

Capex

  • FY26 Capex Capex · FY26 · High confidence INR400 crores
    FY '26 should be close to around INR400 crores.

    — Chanchal Rajora

Backward Integration

  • CRGO Backward Integration Backward Integration · future · High confidence almost 100%
    Yes. CRGO will be almost 100% ours almost I say because sometimes the larger rating are many and then limited capacity of the larger machine. So we may have to buy from outside or we may get it done on job work.

    — Jitendra Mamtora

What to watch in Q1 FY26

Capacity Utilization Rate

next year
Current 60%-65%
Target 80%

Why it matters

Indicates operational efficiency and ability to meet growing demand.

Yes, we are currently at 60%-65% utilization. Next year, we should reach about 80% utilization.

Risks & concerns

  • Competition from other players

    medium

    Management aims not to increase margins excessively to avoid 'opening the door for others' in the competitive market.

    Management acknowledged

  • Raw material price volatility (CRGO)

    low

    Backward integration into CRGO processing is expected to mitigate dependency and improve supply chain resilience.

    Management mitigated

  • Government capex slowdown in power sector

    low

    Management stated there is no slowdown in government spending in the power and energy sector.

    Analyst downplayed

Q&A highlights

7 direct
Margin sustainability for the year ahead Direct
Sir, quarter 4, there are a couple of orders that we have executed were at very, very excellent margins. And that's why this quarter 4 margin is looking a little bit robust. But on the futuristic side, the margins what we are showing on a yearly basis will be the guided margins, sir. ... 16% to 17% level, sir.

Clarified that the exceptionally high Q4 margin was due to specific orders and that the sustainable yearly margin target is 16-17%.

Asked by Bharat Shah

Sustainability of improved working capital and future targets Direct
And the working capital what we are showing here, if you have been actually hearing us, we are targeting at the level of around 120 days working capital. And I'm pleased to say that we are quite on that track. And it's a sustainable working capital for throughout the year.

Confirmed the sustainability of the improved working capital days and set a target of around 120 days.

Asked by Manish Ostwal

Clarification on INR8,000 crores target for next year Direct
So, next financial year, our order book input will be around INR8,000 crores?

Clarified that the INR8,000 crores figure refers to the order *input* for the next financial year, not the total order book.

Asked by Manish Ostwal

Strategy for HVDC segment and potential tie-ups Partial
Anupam, there are no orders as such. But they've been promised by the central [24:37-Inaudible], they will give us the work for the repair of the transformers. And once they are comfortable with what we do on the transformers, which we are going to repair, because there is a huge failure of the HVDC transformers in the grid. ... But as far as the technology is concerned, we are not going to get the technology from anyone, nobody is going to share that. Now if you see even 400 kV and 765 kV, technology is not available. If somebody has to do it, he has to do it on his own.

Revealed plans to enter the HVDC segment through repair work for the central government, leveraging in-house capabilities rather than external technology tie-ups.

Asked by Anupam Goswami

Volume and extent of CRGO backward integration Direct
See, we have taken over a company which was into this business. So, we have taken 51% stake in it. So, we don't have to look for the technology partner or anything. The person is already there, he's working on that, and we are adding on two more lines for manufacture of CRGO of different configuration, and also the CRGO for the reactor coils. ... Yes. CRGO will be almost 100% ours almost I say because sometimes the larger rating are many and then limited capacity of the larger machine. So we may have to buy from outside or we may get it done on job work.

Provided details on the CRGO acquisition (51% stake) and the strategy to achieve near 100% backward integration for this critical raw material.

Asked by Pritesh Chheda

Discrepancy in MVA realization figures Direct
Mayank, this is wrong perception of the people that realization of the - per MVA realization is just for the namesake. See, if you make a larger transformers, like if you make a 500 MVA, 765 kVA transformer, which is single phase, which is around today, the 500 MVA transformer costs about INR20 crores. If you talk about 500 MVA transformer, three phases of 400 kV, it is costing you INR32 crores. So it is just for the namesake, you can't decide the per MVA realization of the transformer and come to the conclusion about the margins. Like reactors, reactors are, again, 7 lakhs to 8 lakhs per MVA. But they are different.

Clarified that MVA realization is not a consistent metric across different transformer types and sizes, and thus not a reliable indicator for margin analysis.

Asked by Mayank Chaturvedi

Funding for the 22,000 MVA capacity expansion Direct
From the internal accruals and the QIP proceeds what we have with us.

Confirmed that the significant capacity expansion will be funded through internal accruals and the recently raised QIP proceeds, indicating financial strength.

Asked by Prerak Gandhi

Potential bottlenecks in the power and transmission industry due to government capex Direct
No, there is no slowdown in terms of government spending in the power sector at all, power and energy sector at all.

Management provided a clear stance that they do not foresee any slowdown in government spending, which is crucial for the capital goods sector.

Asked by Prerak Gandhi

2 min read 5 chapters

Detailed narrative

Record Performance and Robust Growth in FY25

Transformers and Rectifiers (India) Limited achieved its highest-ever production of 29,118 MVAs in FY25, a significant increase from 16,425 MVAs in FY24. This translated into a 53% year-on-year growth in standalone revenue, reaching ₹1,950 crores. Consolidated revenue for FY25 stood at ₹2,051 crores, surpassing the initial guidance of ₹2,000 crores. EBITDA for the standalone business grew by 149% to ₹320 crores, with margins expanding to 16.12% from 10.03% in FY24, while consolidated EBITDA was ₹359 crores.

Strong Order Book and Enhanced Revenue Visibility

The company secured a total order inflow of ₹4,504 crores in FY25, marking its highest-ever inflow. This included a landmark single order of ₹740 crores from GETCO in March 2025. As a result, the unexecuted order book stood at a robust ₹5,132 crores as of March 31, 2025, providing clear revenue visibility for the next 15 to 18 months. Management targets an order input of approximately ₹8,000 crores for the next financial year.

Strategic Backward Integration and Capacity Expansion

TARIL completed the acquisition of a 51% controlling stake in a CRGO processing unit, aiming for near 100% backward integration for this critical raw material, which constitutes 32-35% of transformer cost input. This move is expected to enhance in-house capabilities and supply chain resilience. The company also initiated two major capacity expansions: a 15,000 MVA expansion with Phase 1 operational by May 2025, and a 22,000 MVA expansion for EHV transformers at its Moraiya facilities, expected by February 2026. These expansions will increase total manufacturing capacity to 75,000 MVA.

Improved Financial Health and Capital Structure

The company significantly strengthened its balance sheet, with the debt-to-equity ratio reducing to 0.2% in FY25 from 0.84% in FY24, moving towards a goal of becoming net debt-free within 1-2 years. Debtor days improved to 114 from 156 in the previous year, reflecting better working capital management. TARIL successfully raised ₹500 crores through a Qualified Institutional Placement (QIP) to fund its backward integration and capacity expansion plans.

Future Outlook and Growth Targets

TARIL maintains its long-term vision to achieve US$1 billion in revenue within the next three years. The company aims to sustain EBITDA margins at 16-17% and a PAT level of 10% for the year ahead. Management expects capacity utilization to reach approximately 80% next year from the current 60-65%. The focus remains on consistent execution, customer-centric innovation, and robust financial discipline, with no anticipated slowdown in government spending in the power sector.

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