Uniparts India Q1 FY27 earnings call

Uniparts India Limited delivered a robust Q1 FY27, with revenue growing 27% year-on-year to INR347 crores. This strong top-line growth translated into significant profitability improvements, as EBITDA increased by 55% year-on-year to INR90 crores, and Profit After Tax (PAT) surged by 64% year-on-year to INR57 crores. The company's trailing 12-month EPS stands at INR39.97, with ROCE exceeding 27% and ROE at 20%, reflecting healthy operational leverage and disciplined cost management.

The construction equipment segment emerged as a key growth driver, now contributing 45% of the total revenue in Q1 FY27, benefiting from infrastructure-led spending in the U.S. and government investments in Europe. In contrast, the large agricultural equipment market remains subdued, with a projected mid-teens decline in calendar year 2026, while the small agriculture segment is showing an uptick, with growth expected in calendar year 2027. The aftermarket business remained flat year-on-year, contributing 12% of revenue, down from 20% in FY25 and 15% in FY26.

The company reported significant progress on operational fronts, with the restoration of the finishing shop at its Ludhiana facility progressing well and ensuring uninterrupted customer supply. Furthermore, Uniparts' Mexico operations are on track, with first customer deliveries from the warehouse anticipated in Q3 FY27. This milestone underscores the company's journey as a global supply partner and its commitment to expanding its international footprint.

Uniparts maintains a strong financial position, ending Q1 FY27 with a net cash position of INR190 crores. This cash balance was rebuilt after a special dividend of INR101 crores declared in October 2025. Capital expenditure for the quarter was INR12 crores, aligned with ongoing investment plans for capacity enhancement, productivity improvement, and customer-led growth initiatives. The company continues to actively evaluate acquisition opportunities in hydraulics, PTOs, and fabrication, focusing on value-accretive deals that can be integrated within 18-30 months.

The EBITDA margin for Q1 FY27 stood at 25%, an increase from 24% in the previous quarter, driven by operating leverage and a favorable channel mix. Warehouse sales, which offer the highest margins, constituted approximately 56% of sales in Q1 FY27, up from 50-52% in Q1 FY26. Management reiterated its confidence in maintaining material costs within the 34% to 37% range and achieving a 20% plus EBITDA margin over the cycle.

Management expressed confidence in improving on its earlier guidance for the full fiscal year, with FY27 revenue growth expected to be a couple of percentage points higher than FY26's 21% growth. The construction industry's strong momentum and the anticipated recovery in the small and large agricultural segments in calendar year 2027 are expected to drive future growth. The company also anticipates the aftermarket business to normalize within the next 12 months as tariffs reduce.