Summary
Arisinfra Solutions Limited - Q3 FY26 Earnings Call Summary Friday, January 30, 2026 5:30 PM
Event Participants
Executives 3 Bhavik Khara (Whole-Time Director & CFO), Ronak Morbia (Chairman & Managing Director), Srinivasan Gopalan (CEO)
Analysts 4 Deepak Poddar (Sapphire Capital), Kapil Ahuja (Equinox Capital), Kaushal Sharma (Equinox Capital), Namish Gupta (Individual Investor)
Financials & KPIs
| Metric | Reported | Commentary |
|---|---|---|
| Revenue | ₹270 crores | +50% YoY; Driven by strong demand in infrastructure build-outs and expansion in contract manufacturing. |
| Gross Margin | 17.4% | +200 bps YoY; Improvement attributed to a higher mix of services and contract manufacturing segments. |
| EBITDA | ₹30 crores | +131% YoY (2.3x); Margin improved from 9.38% to 11.75% due to operational leverage. |
| Profit After Tax (PAT) | ₹18.27 crores | +813% YoY (9.1x); Significant growth from ₹2 crores in Q3 FY25. |
| Net Working Capital | 74 days | -42 days YoY; Drastic reduction from 116 days due to tighter credit discipline and tech-led monitoring. |
| Net Debt | ~₹40 crores | Primarily working capital facilities; long-term debt remains minimal at ₹6 crores. |
| Receivables | ₹385 crores | Includes ₹50-₹55 crores (approx. 14% of total) aged above 6 months, which is factored into ECL. |
| Cash Balance | >₹150 crores | Healthy liquidity maintained following IPO proceeds and improved debtor collections. |
Geographic & Segment Commentary
- Contract Manufacturing: Contributed 48% of total revenue this quarter, up from 35% in Q3 FY25. Management reported a utilization rate of over 55% across its 9 million metric ton capacity of stone aggregates and RMC. The segment relies on securing capacity via deposits rather than asset ownership.
- B2B Trade: Acts as the entry-level layer for customer acquisition and relationship building. While still a primary volume driver at 47% of the mix, the focus is shifting towards moving these clients into higher-margin manufacturing and service agreements.
- Services: Represents 9% of total revenue but contributes a disproportionately high share of EBITDA. This segment scales with minimal incremental capital deployment as it is based on execution capability and technology systems.
Company-Specific & Strategic Commentary
- Rebranding to “Aris”: The company shortened its name from Arisinfra to Aris to reflect its evolution from an infra-supplier to an organized execution backbone for construction materials.
- Asphalt Vertical Entry: Launched a new vertical in the Asphalt segment through a joint venture model. Already secured a ₹35 crore order from an infra company and completed a project for Apco in Mumbai.
- Asset-Light Scale: The model relies on strategic deposits (refundable) to secure third-party plant capacity. Management emphasizes that as utilization reaches 80%+, these deposits are returned and reinvested, preventing the business from becoming capital-hungry.
Guidance & Outlook
| Metric | Guidance / Outlook | Commentary |
|---|---|---|
| Revenue Growth | 40% YoY for FY26 | Management confirmed they are on track for this target with strong visibility into Q4. |
| EBITDA Margin | ~11% (Base) | Margins are deemed sustainable due to structural shifts in product mix toward services/manufacturing. |
| Leverage (Debt/Equity) | 0.4x to 0.5x | Management committed to keeping leverage within this range despite aggressive growth targets. |
| Asphalt Revenue | ₹80 - ₹100 crores | Target revenue for the new Asphalt vertical over the next 12 to 18 months. |
Risks & Constraints
| Risk | Context |
|---|---|
| Working Capital Intensity | Rapid growth (40% target) typically requires high capital; however, management argues their mix shift and “revolving” deposit model mitigates this. |
| Aged Receivables | ₹50-55 crores of receivables are older than 6 months. Management expects this to drop to ₹30-35 crores by March 2026, but it remains a point of analyst concern. |
| Fragmented Industry | Aggregates and construction materials are largely informal, posing risks in standardized sourcing and GST compliance for small-scale partners. |
Q&A Highlights
Business Mix & Profitability
- Question: Is the current 11% EBITDA margin sustainable as a base? (Deepak Poddar)
- Answer: Yes, the improvement is structural. As the mix shifts toward services and contract manufacturing, profitability is expected to remain stable or improve (Ronak Morbia).
Working Capital & Funding
- Question: How will the company fund 40% growth once IPO proceeds are fully utilized? (Kaushal Sharma)
- Answer: The IPO proceeds were used for vendor payments and have already started returning as debtor collections. The company has a cash balance of >₹150 crores and existing deposits have 30-40% headroom for growth (Srinivasan Gopalan).
Receivables Quality
- Question: What is the status of the ₹55 crores in receivables aged over 6 months? (Kapil Ahuja)
- Answer: These are moving accounts, not stagnant ones. Expected credit loss (ECL) is already factored into the P&L; management expects this bucket to reduce to ₹30-35 crores by March (Bhavik Khara).
New Segment Strategy
- Question: What is the potential of the new Asphalt vertical? (Deepak Poddar)
- Answer: Management expects ₹80-₹100 crores in revenue over the next 12-18 months with margins in line with the company average (Ronak Morbia).
Key Takeaway
Aris delivered a strong Q3 FY26, characterized by a 50% YoY revenue jump to ₹270 crores and an EBITDA increase of 2.3x to ₹30 crores. The performance was underpinned by a strategic shift in segment mix, with contract manufacturing now contributing 48% of revenue and services scaling to 9%. Crucially, the company reduced its net working capital days from 116 to 74, signaling a transition toward more capital-efficient growth. Despite aggressive expansion, Aris remains committed to an asset-light model, leveraging a network of third-party plants with a current capacity of 9 million metric tons. Management maintained its 40% growth guidance for FY26, supported by strong Q4 visibility and the launch of a new Asphalt vertical. While aged receivables (₹55 crores >6 months) remain a watch point, the healthy cash balance of over ₹150 crores and low net debt provide a robust cushion for the company to compound its market position as an organized execution backbone in India’s fragmented infrastructure supply chain.
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