Summary
Atlanta Electricals Limited - Q3 FY26 Earnings Call Summary Tuesday, January 20, 2026 11:00 AM
Event Participants
Executives 4 Akshaykumar Banshilal Mathur (CEO), Anand Sharma (COO), Mehul Sureshbhai Mehta (CFO), Niral Krupeshbhai Patel (Chairman and MD)
Analysts 9 Anuj Shah, Arafat, Balasubramanian, Ishwar R, Jainam, Kunal Sheth, Nikhil Abhyankar, Nishita, Praveen Motwani, Saif Sohrab, Viral Shah
Financials & KPIs
| Metric | Reported | Commentary |
|---|---|---|
| Order Book | ₹2,451 crores | All-time high; provides execution visibility for the next 18 months. |
| Revenue from Operations | ₹472 crores | +80% YoY, +49% QoQ; driven by Vadod facility ramp-up and high legacy plant utilization. |
| EBITDA | ₹91 crores | +120% YoY; reflects operating leverage and improved product mix. |
| EBITDA Margin | 19.4% | +350 bps YoY from 15.8%; driven by higher kV class mix and procurement efficiencies. |
| Net Profit (PAT) | ₹43 crores | +95% YoY; 9% PAT margin for the nine-month period. |
| Order Intake (Q3) | ₹796 crores | Robust quarterly run-rate; includes marquee EHV and renewable orders. |
| Sales Volume (9M) | 13,500 MVA | Mix: 220 kV (45%), 132 kV (19%), 66 kV (32%). |
| Total Debt | ₹186 crores | Includes ₹65.57 cr long-term (BTW acquisition) and ₹120 cr working capital. |
Geographic & Segment Commentary
- Extra High Voltage (EHV): Operations commenced at Atlanta Trafo (Unit 5) for 400 kV and 765 kV class transformers. The segment offers higher entry barriers and structurally better margins; the company is currently focusing on prototyping 400 kV units before full-scale order intake.
- Renewable Energy: Secured ₹134 crores in orders from Adani Green Energy for inverter duty transformers and ₹116 crores for solar pooling substations. Management noted that BESS (Battery Energy Storage Systems) is emerging as a high-growth segment with active inquiry pipelines.
- Exports: Secured the first significant export order of ₹20 crores. While the primary focus remains on the domestic market due to national demand, a dedicated export team is expanding the footprint into global geographies.
Company-Specific & Strategic Commentary
- Capacity Expansion: Successfully scaled manufacturing capacity from 16,000 MVA to 63,000 MVA (+3.9x) over 18 months. The Vadod facility (Unit 4) contributed approximately one-third of Q3 revenue (₹160 crores) with 30% utilization.
- Testing Infrastructure: Added three NABL-accredited testing labs in Q3, totaling seven. This in-house capability is critical for qualifying for large utility tenders and high-voltage testing.
- Strategic Restraint on 400 kV: Management is intentionally limiting new 400 kV orders until the first prototype is proven to manage execution risk. A strategic shift to full-scale 400 kV intake is expected to significantly lengthen the order book duration.
- Backward Integration: Planning capex for in-house manufacturing of tanks and radiators starting Q1 FY27 to improve quality control and optimize costs.
Guidance & Outlook
| Metric | Guidance / Outlook | Commentary |
|---|---|---|
| Revenue Growth | 40% YoY for FY26 | Management maintains historical growth trajectory despite 9M standing at 33%. |
| Order Intake | ~₹600 - ₹700 crores/quarter | Sustainable run-rate based on current inquiry pipeline of ₹10,000 crores. |
| Debt Reduction | Full repayment of LT Debt | Intend to repay the remaining ₹65 crores acquisition debt within the current fiscal year. |
| Margin Sustainability | ~19% EBITDA Margin | Sustainable as product mix shifts toward higher kV classes (220 kV and above). |
Risks & Constraints
| Risk | Context |
|---|---|
| Chinese Competition | Potential easing of restrictions on Chinese bidders in govt contracts. Management notes local content requirements and a 12-18 month qualification cycle act as buffers. |
| Execution Delays | Grid integration constraints and Right of Way (RoW) issues in the broader industry. While Atlanta sees no current delivery delays, national transmission projects face 12% solar curtailment. |
| Prototype Risk | Entry into 400 kV/765 kV requires successful “first-time” prototyping. Management is managing this by pausing large-scale 400 kV orders until initial units are validated. |
Q&A Highlights
The Chinese “Threat”
- Question: What is the background on potential Chinese entry and its impact? (Kunal Sheth)
- Answer: Primarily intended to bridge the gap in the Boiler Turbine Generator (BTG) sector, not just transformers. Any participant must still manufacture in India; only one Chinese player currently has an Indian plant, and its capacity is fully booked for 18-20 months (Anand Sharma).
Margin Sustainability
- Question: Is the EBITDA margin expansion sustainable given commodity volatility? (Nikhil Abhyankar)
- Answer: Large transformers (>66 kV) have price variation clauses (PVC), allowing for cost pass-throughs. The margin expansion is structural, driven by moving up the kV class ladder where competition is lower (Niral Patel).
Capacity Utilization
- Question: What is the current utilization of the new Vadod facility? (Vignesh Iyer)
- Answer: Approximately 30% in Q3. Revenue contribution was ₹160 crores. As utilization scales, operating leverage will continue to benefit the bottom line (Niral Patel/Mehul Mehta).
Order Conversion
- Question: What is the current bid pipeline and win rate? (Jainam)
- Answer: The active order pipeline is approximately ₹10,000 crores. Atlanta has maintained a hit ratio of 10% to 15% this year (Anand Sharma).
Key Takeaway
Atlanta Electricals delivered a transformative Q3 FY26, characterized by an 80% YoY revenue jump to ₹472 crores and record EBITDA margins of 19.4%. The quarter marked the first meaningful contribution from the newly expanded 63,000 MVA capacity, specifically the Vadod facility. Strategy is centered on migrating from the competitive 33/66 kV class to the higher-margin 220/400/765 kV segments, supported by an all-time high order book of ₹2,451 crores. While management is monitoring potential Chinese entry, they remain confident due to long qualification cycles and local manufacturing mandates. The company is focused on reaching its 40% annual growth guidance, deleveraging the balance sheet by year-end, and proving 400 kV prototypes to unlock larger-ticket utility contracts. Atlanta is positioned as a primary beneficiary of India’s planned ₹9.6 trillion transmission capex through 2032.
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