L.T. Elevator Limited Q3 FY26 Earnings Call Summary

Summary

L.T. Elevator Limited - Q3 FY26 Earnings Call Summary Monday, January 19, 2026 12:00 PM

Event Participants

Executives 2 Arvind Gupta (Managing Director), Yash Gupta (Executive Director)

Analysts 6 Dheeraj Kumar (Alpha Sqr), Harsh Dadlani (Individual Investor), Neeraj Sadani (Kalki Ventures), Nikhil Chaudhary (Toro Wealth Managers LLP), Pradeep Goenka (Shangrila Finvest Private Limited), Rohit (Rms Growth), Sahil Raj (Samdariya Capital), Subhanu Bangal (3 Head Capital)

Financials & KPIs (Projected & Historical)

Geographic & Segment Commentary

• B2C / Home Elevators (Ricardo): This segment focuses on high-margin, customized lifts for individual homeowners with a 100% digital lead generation model. Currently generating 2,000-2,500 enquiries monthly via Meta Ads, the segment is expected to contribute 50-60% of total revenue by FY28. Management aims to leverage Ricardo’s 18 existing experience centers to establish the first “digital-native” national elevator brand.

• B2B / B2G (L.T. Elevator): Traditionally East India-centric, this segment serves real estate developers and government bodies. Post-acquisition, the geographic mix is shifting, with over 50% of orders now coming from outside East India. The focus remains on steady execution, though the B2G component introduces longer receivable cycles compared to the advance-payment model of B2C.

• Car Parking Systems: A five-year-old vertical that is currently outgrowing the traditional elevator business. Management is exploring international expansion and strategic changes to enhance this vertical, which currently maintains a similar 13-16% net margin profile to the elevator segment.

Company-Specific & Strategic Commentary

• Ricardo Acquisition Rationale: The merger combines Ricardo’s digital marketing engine (D2C) with L.T. Elevator’s engineering and manufacturing backend to solve Ricardo’s operational fulfillment gaps. The acquisition involves 2-3% equity dilution, with shares locked for 3-4 years to ensure management continuity.

• In-house Manufacturing Shift: Management plans to move Ricardo’s 100% outsourced production in-house to L.T. Elevator’s facilities. This shift is expected to capture manufacturing margins and improve product quality control, replacing the currently inefficient third-party vendor model.

• Digital Brand Building: Strategic focus is on creating a premium brand recall through social media, emulating successful D2C brands in other sectors (e.g., Boat, Wakefit). This approach bypasses the expensive traditional marketing route used by MNC incumbents like Otis or Kone.

Guidance & Outlook

Risks & Constraints

Q&A Highlights

Acquisition Valuation & Dilution

• Question: What are the terms of the Ricardo merger and the incentive for their founders? (Nikhil Chaudhary)
• Answer: The merger involves a low single-digit equity dilution (2-3%) in L.T. Elevator. The equity is locked for 3-4 years, unlocking 25-30% annually to ensure the Ricardo team continues leading the D2C vertical (Yash Gupta).

Digital Marketing Efficiency

• Question: How can a ₹46 crore order book be built on such small digital spends? (Nikhil Chaudhary)
• Answer: Digital spend is currently ₹10-12 lakhs per month, representing an incredible return on ad spend. Management sees more opportunity in increasing this spend rather than just focusing on the 2% conversion rate (Yash Gupta).

Manufacturing & Capacity

• Question: Where do you see the company in 3-5 years compared to MNCs? (Pradeep Goenka)
• Answer: We aim to produce 2,000 elevators by FY28, roughly 1/6th the scale of market leader Johnson. This requires a shift to a new facility by late 2026 with ₹400 crore potential capacity (Yash Gupta).

Business Model Synergies

• Question: Why did Ricardo agree to merge after only one year? (Nikhil Chaudhary)
• Answer: Ricardo excelled at marketing but struggled with the technical backend and engineering of elevators. By merging, they get L.T.’s manufacturing support, while L.T. gains a Pan-India D2C brand (Yash Gupta).

Key Takeaway

L.T. Elevator delivered a strategically pivotal quarter headlined by the acquisition of Ricardo Elevators, a move designed to transform the company from a regional B2B player into a national D2C brand. While Ricardo is small (FY25 revenue of ₹5.5 crores), its ₹46 crore order book and digital lead generation engine (60 units/month) provide a high-growth channel that L.T. intends to fuel with its in-house manufacturing capabilities. Management is pivoting the business mix toward a 50-60% B2C share by FY28 to capture 500 bps higher margins and improve cash flows through advance-payment models. To support this scale, the company is committing to a new manufacturing facility to increase capacity to ₹400 crores by late 2026. The primary watch point remains the successful integration of Ricardo’s outsourced production into L.T.’s internal supply chain while managing the capital requirements for upcoming CAPEX. The company is positioned to challenge established MNCs by building India’s first digital-native elevator brand.