Q1 2027 Texmaco Rail & Engineering Ltd Earnings Call Transcript
Key Points
- EBITDA margin improved to 10.8% despite lower revenues, reflecting strong cost optimization and margin improvement initiatives.
- Infrastructure business turned around with a positive EBIT margin of 1.4% compared to an EBIT loss in the same quarter last year.
- Bright Power (electrical infra) revenue surged 76.8% YoY, with EBIT margin expanding 150 basis points to 10.8%.
- PAT increased 85.9% YoY to INR 52 crores, with PAT margin improving by 381 basis points to 6.9%.
- Order book strengthened to INR 9,923 crores, with private and export orders now comprising 96.4% of the freight car order book, diversifying revenue sources.
- Finance costs declined 18.2% YoY and 17% sequentially, supporting profit growth.
- Strategic JV with Trinity Rail enhances leasing capabilities, aiming to increase market share from 15% to 50%.
- New orders include a significant South African contract (INR 4,100 crores) for wagons and maintenance, expanding international footprint.
- Management expects continued revenue growth of 20-50% annually from new business initiatives, with EBITDA margin improvement of 1.2-3% over the next few years.
- Standalone revenue declined due to lower execution in freight car and infrastructure divisions, impacted by supply chain disruptions.
- Freight car production volume was lower at 1,054 units, partly due to high oil and gas prices affecting supply chain.
- Other expenses increased due to freight charges on export orders, impacting cost structure.
- The South African order execution is expected to begin only in FY28, with 50% of revenue deferred to the next financial year.
- Management refrained from providing specific revenue or margin guidance for FY27, citing uncertainty.
- Dependence on rail wheel factory supply for wheelsets remains a potential risk, though current stock is adequate.
- The company is still in a transitional phase, with a qualitative shift in product mix that may affect volume-based growth expectations.
Ladies and gentlemen, good day and welcome to TEXMACO Real Engineering Limited Q1 F527 Earnings Conference Call. As a reminder, all participant lines will be in the listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes.
Should you need assistance during the conference call, please signal an operator by pressing star and zero on your touchstone phone. Please note that this conference is being recorded.
I now hand the conference over to Mr. Naveen Sahadev from ICICI Securities.
Thank you and over to you, Mr. Sahadev.
So on behalf of ICICI Securities, I welcome you all to the Q1 FY27 earnings call of Texmaco Rail and Engineering Limited. From the management, we have with us Mr. Indrajit Mukherjee, Executive Director and Vice Chairman, Mr. Sudipta Mukherjee, Managing Director and also Mr. Kishor Kumar Rajgaria, CFO. So without any further ado, I hand over the conference to the management for their opening comments. Over to
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