Q1 2027 Greaves Cotton Ltd Earnings Call Transcript
Key Points
- Consolidated revenue grew 31% YoY, with core businesses up 16% (19% like-for-like), driven by strong demand across energy and mobility segments.
- Energy Solutions delivered 21% YoY growth, with medium horsepower Genset business outperforming at 32% growth, supported by strong industrial and commercial demand.
- Mobility Solutions grew 18% YoY, with automotive engine business up 36% and engineered components (Excel) returning to growth at 14%, adding new customers like Cafe and Caterpillar UK.
- Greaves Electric Mobility achieved record volume growth of 101% YoY, outpacing industry growth of 75%, and increased market share to 5.6% from 3.2% a year ago.
- Strategic investments advanced: incorporated Greaves International Trading FZE in Dubai for Middle East/Africa expansion, commissioned a robotic gantry cell, and launched a pilot battery energy storage system.
- Board fully subscribed to GEML's rights issue (₹331 crore) and invested ₹50 crore in Greaves Finance, reflecting strong confidence in investee businesses.
- Management remains committed to FY27 margin targets, expecting Q2 to be marginally better than Q1 and H2 to improve, with cost control and pricing actions underway.
- Excel business maintained healthy EBITDA margins above 25%, with improved utilization and debottlenecking efforts supporting future growth.
- International business accounted for ~13% of core revenue, with new export opportunities in firefighting engines and defense orders completed.
- Company maintains a healthy balance sheet with AA- rating and sufficient cash to fund growth aspirations for core and investee businesses.
- Margins were under pressure by 2.5% due to purposeful investments in people, leadership, SG&A, and technology, as well as commodity price increases from geopolitical developments.
- Commodity price increases (platinum, aluminum, steel) led to higher input costs across most businesses, with only partial mitigation through pricing actions.
- Industrial Solutions reported flat revenue YoY, though up 9% on a like-for-like basis, indicating slower growth compared to other segments.
- Greaves Electric Mobility continues to incur losses, though burn rates have fallen to single digits; management expects to reach positive EBITDA in 4-6 quarters.
- Excel's growth was previously impacted by the Russia-Ukraine war, which caused a setback in a large export market, though new opportunities are emerging.
- The company had to defer some non-essential costs and implement a structured cost control program, indicating near-term operational constraints.
- Price increases to mitigate commodity inflation have a time lag, with full benefits expected only in H2 FY27.
- The rights issue for GEML was at par, indicating no premium valuation, which may dilute shareholder value in the near term.
- The company is still in early stages of developing battery energy storage systems, with commercial viability yet to be proven.
- Management did not provide specific guidance on achieving double-digit market share for GEML, with a timeline of 4-8 quarters, indicating uncertainty.
Ladies and Gentlemen, good morning and welcome to Greece Scott Unlimited Q1 and FY27 Earning Conference Call. As a reminder, all participant line will be in the listen-only mode and there will be an opportunity for you to ask question after the presentation conclude.
Should you need assistance during the conference call, please signal an operator by pressing then 0 on your touchstone phone.
Please note that this conference is being recorded. I now hand the conference over to Mr. Ashish Kale, Head Investor Relation from Grieve Scott Unlimited.
Thank you and over to you sir.
Thank you Ranesh. Good morning ladies and gentlemen and a very warm welcome to Grieve Scott Unlimited's Q1 FY27 earnings conference call.
This call is now being recorded.
The financial results and investor presentation for the quarter ended 30th June, 2026 have been filed with the stock exchanges and are also available on the company's website. I hope you had an opportunity to review
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