Summary
Rashi Peripherals Limited - Q3 FY26 Earnings Call Summary Wednesday, February 04, 2026 11:00 a.m.
Event Participants
Executives 3 Himanshu Shah (CFO), Kapal Pansari (MD), Rajesh Goenka (CEO)
Analysts 11 Aasim (DAM Capital), Aejas Lakhani (Unifi AMC), Amit Agitcha (HG Hawa & Co), Amit Khetan (Laburnum Capital), Bhavin Chheda (Enam Holdings), Deepak (Unifi Capital), Deepak Poddar (Sapphire Capital), Dhruvish Pujara (Premji Invest), Gaurav Bhanshali (Augmont Enterprises), Jyoti Singh (Arihant Capital Markets), Madhur Rathi (Counter Cyclical Investments)
Financials & KPIs
| Metric | Reported | Commentary |
|---|---|---|
| Revenue (Consolidated) | ₹4,030 crores | +43% YoY; Driven by 50% volume growth and 50% ASP increases from global supply constraints. |
| PAT (Consolidated) | ₹75 crores | +132% YoY; Benefited from improved product mix and economies of scale. |
| PAT Margin | 1.85% | +71 bps YoY; Reflects stronger realization on inventory and operating leverage. |
| Revenue (Standalone) | ₹3,895 crores | +47% YoY; Robust momentum despite no large project orders in the current quarter. |
| PAT (Standalone) | ₹70 crores | +128% YoY; Margin expanded to 1.81% due to better efficiency. |
| Inventory Days | 56 days | +4 days YoY; Increased to support strong demand and ensure product availability amid shortages. |
| Debtor Days | 47 days | -14 days YoY; Improved collection and tighter credit monitoring protocols. |
| Working Capital Days | 60 days | Stable YoY; Management remains focused on high efficiency to manage price volatility. |
| Operating Cash Flow | ₹34 crores | Positive YTD; Improvement from previous outflow periods through disciplined WC management. |
Geographic & Segment Commentary
- Personal Computing and Enterprise Solutions (PES): Contributed 58% of revenue (₹6,572 crores) for 9M FY26. Segment share increased from 51% to 56% YoY in Q3, driven by enterprise refresh cycles, Windows 10 transition, and AI-ready device adoption.
- Lifestyle and IT Essentials (LIT): Contributed 42% of revenue (₹4,767 crores) for 9M FY26. While LIT share of total revenue dipped slightly, it saw substantial price appreciation in components, particularly RAM (up 2x-3x) and SSDs.
- Geographic Reach: Expanded to 55 branches with a new opening in Solapur. The network now serves 10,000+ partners across 700+ locations, focusing on demand creation in underpenetrated non-metro geographies.
Company-Specific & Strategic Commentary
- Price Volatility Management: Management successfully leveraged component shortages and ASP hikes (20-30% in laptops) into revenue growth, despite flat unit volume outlooks for certain categories.
- Vendor Diversification: Following Micron’s EOL for “Crucial” consumer brands, the company is shifting focus to Micron Enterprise products and backup vendor plans to mitigate volume hits in FY27.
- Credit Strength: Achieved a credit rating upgrade to AA- category, intended to reduce overall borrowing costs (currently 7.5%-8%) and increase working capital capacity.
- New Market Entry: Established a UAE subsidiary to facilitate material execution for SAARC countries, mirroring the Singapore hub model.
Guidance & Outlook
| Metric | Guidance / Outlook | Commentary |
|---|---|---|
| Revenue Growth | 15% to 20% (Base business) | Expected to continue based on higher ASPs even if unit volumes remain flattish. |
| Volume Growth | Flat YoY (FY27) | Anticipated “unaffordability” from price hikes may dampen unit demand, though enterprise refresh continues. |
| Component Pricing | Sustained High / Rising | No softening expected in the near term for RAM/SSD; further 5-8% monthly hikes anticipated in Q4. |
| Project Business | Moderate Recovery | FY26 growth was “clean” (zero large projects); management expects large deal conversions in FY27. |
Risks & Constraints
| Risk | Context |
|---|---|
| Product Obsolescence | Micron’s decision to discontinue the “Crucial” consumer brand poses a revenue risk in FY27 that must be offset by other brands. |
| Demand Softening | Rapid ASP increases (20-30%+) may lead to “unaffordability,” specifically in the B2C consumer segment, potentially stalling volume growth. |
| Working Capital Stress | Rising unit costs require more capital to move the same volume; management must balance procurement needs with borrowing costs. |
Q&A Highlights
Revenue Drivers & Pricing
- Question: What explains the 43% revenue growth? (Aejas Lakhani)
- Answer: It was roughly a 50/50 split between volume growth and ASP increases/dollar appreciation. (Rajesh Goenka)
Supply Chain & AI Impact
- Question: Is AI infrastructure affecting supply for your segments? (Aejas Lakhani)
- Answer: Hyperscalers are taking the majority of supply, leading to consumer/commercial constraints. We are managing through advanced inventory planning to prevent stockouts. (Rajesh Goenka)
Project Business Comparison
- Question: Does this growth include large project orders? (Bhavin Chheda)
- Answer: No. Last year included ~₹2,000 crores of project revenue which is nil this year. This 5% 9M growth is entirely from the higher-margin base distribution business. (Rajesh Goenka)
Micron/Crucial Business
- Question: How will the Micron “Crucial” brand discontinuation affect you? (Gaurav Bhanshali)
- Answer: It will be a dent in FY27; however, we will shift focus to Micron’s enterprise-class business and alternative backup vendors. (Rajesh Goenka)
Margin Sustainability
- Question: Are these 2.9% Q3 margins sustainable? (Jyoti Singh)
- Answer: Given current ASP trends and market size, we expect the similar trend to continue in the near term with no major variation. (Rajesh Goenka)
Key Takeaway
Rashi Peripherals delivered a robust performance in Q3 FY26, characterized by a 43% YoY revenue jump and a 132% surge in PAT. This growth was notably achieved without the large, lower-margin project orders present in the previous year, highlighting the strength of the core distribution business. Strategic focus remains on capitalizing on the Windows 10 refresh cycle and the burgeoning AI-ready PC market, while navigating significant component price hikes in RAM and SSDs. Management successfully utilized its pan-India network of 55 branches to manage inventory ahead of these price increases. While unit volumes are expected to remain flattish in FY27 due to affordability concerns, the company anticipates sustained revenue momentum through higher ASPs and an optimized product mix. Rashi Peripherals remains well-positioned to benefit from India’s digital infrastructure push, provided it effectively manages vendor transitions and borrowing costs following its recent credit upgrade.
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