Tube Investments

Tube Investments delivered a strong Q4 FY26, with standalone revenue increasing 16.4% year-on-year to ₹2,279 crores and full-year revenue reaching ₹8,556 crores, an 8.4% YoY growth. Standalone PBT before exceptional item^📎s and fair value gain on CCPS for Q4 stood at ₹361 crores, up 10.4% YoY, while the full-year PBT was ₹1,099 crores, a 12.7% increase. Consolidated revenue for Q4 grew 20.7% YoY to ₹6,215 crores, and for the full year, it was ₹22,847 crores, up 17.4% YoY. The company maintained a robust ROIC of 44% for the year and generated ₹826 crores in cumulative free cash flow, representing 100% of PAT.

The Engineering segment was a key growth driver, with Q4 revenue up 21.6% YoY to ₹1,495 crores and PBIT up 23.9% YoY to ₹176 crores. The Mobility business also saw Q4 revenue growth of 14.9% YoY to ₹208 crores, though PBIT remained flat at ₹4 crores. In contrast, the Metal Formed Products segment experienced sluggish growth, with Q4 revenue up only 4.5% YoY to ₹421 crores and PBIT declining 10.3% YoY to ₹35 crores, attributed to railway profitability issues and muted demand from a key OEM. Other businesses showed marginal Q4 revenue growth of 0.8% to ₹246 crores, with PBIT increasing 23.1% to ₹16 crores.

CG Power and Industrial Solutions Limited, a 56% owned subsidiary, delivered strong results with Q4 consolidated revenue growing 25.0% YoY to ₹3,442 crores and PBT before exceptional item^📎s up 27.6% YoY to ₹490 crores. For the full year, CG Power's revenue increased 25.3% YoY to ₹12,418 crores. However, Shanthi Gears Limited, a 70% owned subsidiary, faced challenges, reporting a Q4 revenue decline of 11.8% YoY to ₹135 crores and a PBT drop of 19.4% YoY to ₹25 crores. Its full-year revenue also decreased by 14.2% YoY to ₹519 crores.

The EV segment is experiencing an 'upswing in demand,' particularly in heavy truck and small commercial vehicle segments, with a 'very good order book' for big trucks. However, deployment challenges persist, primarily due to financing requirements (₹100 crores for 50-100 trucks) and the need for robust charging infrastructure. For 3-wheelers, a critical body-in-white supply issue, which impacted Q4 volumes (producing only 50% of potential), has been resolved, and the company expects to return to normal production capacity in Q1 FY27. The company is also actively pursuing cost reduction and localization across all EV platforms, having achieved PM E-drive certification for its Montra Electric Rhino in Q4.

The TI Medical business is projected to grow by 15-20% year-on-year, supported by a recent asset acquisition of the Medicura facility in Ambala for the IV cannula business, which is expected to commence operations after plant approvals in Q1/Q2 FY27. While the business faced temporary headwind^📎s in the Middle East due to geopolitical situations, the company remains bullish on its growth prospects. The CDMO business is nearing completion of its Naidupet facility, with commercial production anticipated to begin in the next quarter (Q1 FY27), marking a new revenue stream.

For the upcoming fiscal year (FY27), Tube Investments plans a capital expenditure of approximately ₹300-350 crores for its core businesses. Additionally, an estimated ₹300 crores will be invested in its subsidiaries, including the EV business and TI Medical. These investments are aimed at supporting growth initiatives, capacity expansion, and the operationalization of new ventures like the CDMO facility and the acquired IV cannula business. The company also anticipates 100% utilization of its CRSS plant in Nasik and Western region Tube facilities by the end of FY27 or mid-FY28.