Summary
Elin Electronics Limited - Q3 FY26 Earnings Call Summary Friday, February 06, 2026, 16:00 Hrs
Event Participants
Executives 4 Akash Sethia (Head of Strategy), Kamal Sethia (Managing Director), Praveen Tandon (CEO), Sanjeev Sethia (Director)
Analysts 4 Ananya Nichani (Thinqwise Wealth Managers), Kunal Mehta (Sunidhi Securities), Rahil Dasani (MAPL), Samarth Ashok (Janak Merchant Securities)
Financials & KPIs
| Metric | Reported | Commentary |
|---|---|---|
| Operating Revenue | ₹294 crores | +10% YoY; Driven by strong growth in appliances (OFRs) and fans, offset by lower lighting volumes. |
| EBITDA | ₹11.9 crores | +57% YoY; Growth achieved despite raw material headwinds; margins impacted by higher copper, steel, and aluminum prices. |
| EBITDA Margin | 4.05% | Targeted 5.3%–5.8% for FY26; Impacted by lower export mix and surging commodity costs. |
| PAT | ₹3.8 crores | +171% YoY; Significant recovery from ₹1.4 crores in Q3 FY25. |
| Net Cash | ₹59 crores | As of December 2025; Management noted idle cash is currently a drag on ROCE until Bhiwadi capex is deployed. |
| Working Capital | 68 days | +9 days YoY; Elevated due to abnormal inventory build-up; expected to normalize to ~50 days by March 2026. |
| 9M FY26 Capex | ₹24.5 crores | Part of a larger ₹100–₹110 crore annual plan, primarily for the new Bhiwadi facility. |
Geographic & Segment Commentary
- Lighting, Fans & Switches: Revenue stood at ₹62.3 crores. While LED lighting (ex-flashlights) declined to ₹38.6 crores due to lower volumes from Signify, the fan business grew 100% YoY, driven by BLDC ceiling fans. The company has onboarded 5 new lighting customers, now contributing 50% of monthly segment revenue.
- Home Appliances: Segment revenue grew from ₹52.3 crores to ₹102.8 crores. Growth was led by a 330% YoY surge in Kitchen/Home Care driven by Oil Filled Radiators (OFRs), though Personal Care declined 10% due to weak urban discretionary demand for hair straighteners.
- FHP Motors: Third-party revenue declined to ₹45.6 crores as more production was diverted for captive consumption in appliances. Management is preparing for mandatory BIS implementation in washing machine and AC motors (expected Aug/Sept 2026) to drive future local demand.
Company-Specific & Strategic Commentary
- Bhiwadi Expansion: Construction of the ₹100 crore Phase I plant is underway with operational commencement expected by May 2026. It has a peak revenue potential of ₹550–₹600 crores and is expected to generate ₹140 crores in FY27 at 20% ROCE.
- Backward Integration: Management claims a 5%–8% cost advantage over imports/competitors in OFRs and chimneys by manufacturing fins, motors, sheet metal, and electronics in-house.
- Export Recovery: Following the easing of US tariff situations in early February 2026, the company is optimistic about restarting fan exports to the USA, which have been nil since August 2025.
- Product Diversification: Strategic move into “medium appliances” including chimneys and air coolers. Two customers have already been tied up for the upcoming chimney launch.
Guidance & Outlook
| Metric | Guidance / Outlook | Commentary |
|---|---|---|
| FY26 Revenue Growth | 9% to 10% | Adjusted for the lack of US exports since Aug 2025; dependent on domestic appliance momentum. |
| FY26 EBITDA Margin | 5.3% to 5.8% | Revised slightly downward due to RM volatility and mix change; steady-state Bhiwadi margin target is 7%–7.5%. |
| Bhiwadi Revenue | ₹140 cr (FY27) / ₹250 cr (FY28) | May 2026 start; initial margins will be lower due to part utilization. |
| Fan Revenue Growth | 50% (FY27) | Continued momentum in BLDC and TPW segments. |
Risks & Constraints
| Risk | Context |
|---|---|
| Raw Material Volatility | Sharp surges in copper, steel, and aluminum (trading near all-time highs) cause a 40 bps compression in gross margins before repricing kicks in. |
| Customer Concentration | The transition away from the Signify exclusivity agreement has led to a revenue gap in lighting that is currently being filled by lower-margin new entrants. |
| Execution Delays | Bhiwadi plant commencement was slightly delayed due to government-imposed pollution control restrictions on construction. |
Q&A Highlights
Lighting Turnaround
- Question: How are you entering new lighting customers given high competition? (Rahil Dasani)
- Answer: Elin’s 20-year track record with Philips/Signify provides a “premium quality” reputation; new customers now contribute ~₹150–₹170 crores in annual run-rate (Sanjeev Sethia).
Bhiwadi Profitability
- Question: What are the expected margins for the new plant? (Rahil Dasani)
- Answer: Steady state at 7%+; however, initial quarters will see lower margins due to low utilization. Guidance for consolidated EBITDA will be updated once the plant starts (Akash Sethia).
BIS Regulations
- Question: When will BIS impact the motor business? (Kunal Mehta)
- Answer: Most appliances are already covered. The “big mover” will be FHP motors for washing machines and ACs, slated for August/September 2026, which should trigger a shift from Chinese imports to local sourcing (Sanjeev Sethia).
Manufacturing Strategy
- Question: Will shifting OFR to Bhiwadi leave Ghaziabad underutilized? (Rahil Dasani)
- Answer: No; Ghaziabad will absorb the growing fan business and a new mixer-grinder line for North Indian customers to save on logistics from the Baddi plant (Sanjeev Sethia).
Key Takeaway
Elin Electronics delivered a resilient Q3 FY26 with 10% revenue growth and a 57% jump in EBITDA, despite significant raw material headwinds and the temporary loss of US export volumes. The company is successfully diversifying its customer base in lighting to offset the reduced Signify volumes and is seeing explosive 330% growth in its appliance segment, particularly in Oil Filled Radiators. Strategically, the firm is pivoting toward a “one-stop-shop” model for medium appliances, backed by a ₹100 crore investment in the Bhiwadi facility, which is set to go online in May 2026. While raw material volatility has necessitated a slight downward revision in FY26 EBITDA guidance to 5.3%–5.8%, the company remains well-capitalized with ₹59 crores in net cash. Management expects a recovery in high-margin exports and significant gains from upcoming BIS mandates for motors to drive FY27 performance.
Want more insights like this?
Subscribe to get deep dives delivered to your inbox.
More Earnings Summaries
Explore more Q3 FY26 earnings call analyses: