Good evening, ladies and gentlemen. I'm Akash, moderator for the conference call.

Welcome to Elin Electronics Limited Q3 FY '26 investors call. As a reminder, all participants will be in listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes.

Should you need assistance during the conference call, please signal an operator by pressing star, then zero on your touchtone telephone. Please note, this conference is recorded.

I would now like to hand over the floor to Mr. Gulshan Singh.

Thank you, and over to you, sir.

Thank you, sir. Good afternoon and very warm welcome to everyone.

On behalf of Sunidhi Securities, I welcome you all to Elin Electronics Limited Q3 FY '26 earning conference call. Today, we have with us our management, represented by Mr.

Kamal Sethia, Managing Director; Mr. Sanjeev Sethia, Director; Mr.

Akash Sethia, Head of Strategy; and Mr. Praveen Tandon, CEO.

We thank Elin Electronics Limited for giving us the opportunity to host the call. I would now like to hand over the floor to the management for their opening remarks, post which we will open the floor for a Q&A.

Thank you, and over to you, Sanjeev, sir.

Thank you very much, Mr. Gulshan.

Good evening, ladies and gentlemen. This is Sanjeev Sethia, Director at Elin Electronics, and we also have on call today our Managing Director, Mr.

Kamal Sethia; our Strategy Head, Mr. Akash Sethia; and our CEO, Mr.

Praveen Tandon. Thank you for joining our call for the third quarter and nine months of fiscal year March 2026.

Coming to our overall performance for the quarter, operating revenues for the quarter was ₹294 crores against ₹266 crores in the same period last year, up 10% on a year-on-year basis. Our revenue growth was driven primarily because of strong growth in our appliances and fan business.

This can be attributed to new product launches and customer acquisitions. Consolidated EBITDA for the quarter was ₹11.9 crores against ₹7.6 crores in the same period last year, representing a strong growth of 57%.

While margins improved, we saw sharp surge in raw material costs due to increase in key raw material prices like copper, steel, aluminum. This impacted gross margins for the quarter.

Consolidated PAT for the quarter was ₹3.8 crores against ₹1.4 crores in the same period last year. Our liquidity position remained strong with net cash of ₹59 crores as at December '25.

Our working capital position is at net 68 days due to higher than normal inventory levels. We expect this to normalize within this quarter.

Our capex spend in nine months fiscal year '26 was at ₹24.5 crores. As stated in our earlier calls, the aspiration is to be one-stop shop for all high-volume home appliance and durable needs of OEMs and our customers.

This includes our existing business: lighting, fans, small appliances; and our planned new business: medium appliances, such as air coolers, chimneys, ovens, etc. We will continue to look for such products to add [unclear] next several quarters.

Now, I would like to share with you the performance and the strategy in each of our business verticals. In lighting, fan, and switch segment, the revenue for the quarter was ₹62.3 crores against ₹67.6 crores in the same quarter last year.

This was primarily driven by strong increase in revenue from fan, which was partially offset by a marginal decrease in revenue from lighting. LED lighting, excluding flashlights, declined from ₹51.2 crores in last quarter to ₹38.6 crores in the current quarter.

As mentioned earlier on our call, this was largely led by volume decline from Signify, which was largely offset by gains from new customers added. The revenue run rate on a quarter-on-quarter basis is on an improving trajectory.

As on date, we are serving five new customers in lighting in addition to Signify. As on date, on an incremental basis, our new customers are contributing to 50% of our revenues on a monthly basis.

We have hired a new business head with strong exposure in the lighting business. With his experience and customer connections, we reiterate that we expect double-digit growth in our lighting business in FY '26-'27.

Moving on to our fan business, we have seen strong growth of 100% in our fans business on a year-on-year basis. This has primarily been driven by our BLDC ceiling fan business.

We are also working on diversifying our customer base and adding new customers. We expect this strong growth momentum to continue in Q4 as well.

Our TPW business is showing robust demand. Overall, we expect fans to grow by another 50% in fiscal year '26-'27.

Moving on to the home appliance segment, revenue growth was robust and increased from ₹52.3 crores last quarter to ₹102.8 crores this quarter. Kitchen and home care revenues increased by 330% year-on-year basis.

This was largely on the back of OFRs. Our existing businesses of irons, mixer grinders, etc., has seen good volume growth as well.

Personal segment was down 10% year-on-year demand due to weak demand in hair straighteners and trimmers. Future growth is going to be driven by this segment and our strong focus on also growing ODM share of the business.

While still nascent, we expect ODM to grow strongly over the next several quarters. A quick update about the medium appliance category: while these will be built out of Bhiwadi unit, which will start from next fiscal, we have already initiated discussions with customers for this.

We have a strong outlook for our OFR business for next fiscal, as well as happy to share that we have tied up with two customers for the to-be-launched chimney business. We had shared our optimism in our last call about our relatively nascent export business.

We remain in exploratory talks with a few OEMs to supply from India and export to the USA. Discussions will now commence given the easing of the tariff situation.

We are very hopeful of restarting our fan export to USA. Further, the government push for Make in India and disincentivizing imports via BIS and QCO makes us further optimistic on our business going forward.

Moving on to the FHP motor segment, revenue declined from ₹55.8 crores in last quarter this year to ₹45.6 crores this year. Please note this segment reflects only third-party sales.

Therefore, while segment sales appear declining, underlying growth is strong given that there is captive consumption of motor for the appliance business. In terms of pipeline of new products to be launched, we'll be launching the cooler motor and the BLDC chimney motor by the next year for both third-party sales and captive consumption towards manufacturing the finished products.

I would like to share our guidance of 9% to 10% for revenues from '25 to '26, FY '25 to '26. Our guidance included revenues from export to USA, which has been nil since August 2025 due to the tariff situation.

We are optimistic that the situation is expected to be resolved soon. We are hopeful of adding a few more export projects over the course of next four to six quarters.

EBITDA forecast for the year is forecast at 5.3% to 5.8% margin. Please note that the margin on export is higher than domestic sales; therefore, EBITDA margins has been impacted.

Capex for the year will be ₹100 to ₹110 crores, split as ₹60 to ₹65 crores for phase one of the new plant at Bhiwadi and ₹35 to ₹40 crores for growth of the existing businesses and factories. Once the new facility is stabilized in two years from starting, this will also help us drive up our ROCE since cash sitting idle on our balance sheet has been a drag on the return on capital employed.

A quick update on the Bhiwadi factory: total project cost is estimated at ₹100 crores. Construction has commenced in July 2025 and is progressing well.

Given the current progress, we expect the plant to be ready and operational by May 2026. There's a slight delay due to the pollution control restrictions imposed by the government.

We expect revenue of ₹140 crores in FY '27 and ₹250 crores in FY '28. Reiterating that as per current estimates, revenue potential of the plant is ₹550 to ₹600 crores.

Further, we expect a steady-state EBITDA of 7% to 7.5% for this plant. At these levels, return on capital employed for the plant will be at 20%.

With this, we conclude our opening remarks. We can now open the floor for question and answers.

Thank you very much.

Thank you, sir. Ladies and gentlemen, we will now begin the question and answer session.

If you have a question, please press star and one on your telephone keypad and wait for your turn to ask the question. If you would like to withdraw your request, you may do so by pressing star and one again.

Ladies and gentlemen, if you have any questions, please press star and one. Please wait for a while until the question queue assembles.

The first question comes from Mr. Rahil Dasani from MAPL.

Please go ahead with the question, sir.

Hi, am I audible?

Yes, sir.

Yeah. Good afternoon, and thank you for the opportunity.

Congrats on the set of numbers. I am rather new to the company, some most simpler questions.

For these new products that we are getting into or even the new customers that we are entering, you yourself has said in the previous concalls that competition is high. On what basis or USP or value addition are we able to enter these new customers whose supply chains are already fixed and established?

Sure, happy to answer this. If you see in terms of the new products which we are entering to, A, of course, the oil-filled radiators, which we already started last year, and this is our second.

Then we are getting into chimneys and air coolers. These are the three products which are targeted, which are absolutely new for us.

See, basically, in terms of competence and the kind of backward integration which we have in all these three three product categories is advantage to us as over competition. For example, in oil-filled radiator heaters, we are the only company in India who is doing the complete fin assembly locally.

The rest is being either imported in kit form and just assembly is being done. There's a distinct advantage.

Now after two years under our belt, we are further scaling up our local manufacturing facility, we become naturally competitive with shorter lead times. I think in this, as we want to capitalize on our first-mover advantage and capacity to a level that generally, it's a limited market, other competitors will not easily look at localizing the fin assembly here.

There's one advantage: the kind of backward integration which we have. The same holds true for chimneys also.

If you look at chimneys, basically, the major categories in chimneys, in terms of first, there is motors. We are currently the largest manufacturers of chimney motors in the country, we already have a very strong base and a customer base for motors.

Then the sheet metal fabrication and electronics, that is completely in-house. Again here, the backward integration which we can offer to our customers is far greater than, let's say, the existing chimney manufacturers, because I believe none of them are making motors in-house and probably even electronics is not in-house, it accounts for a fairly large percentage of the BOM which we are going to be doing in-house.

In terms of air coolers, again, it's a combination of the cooler motor, the submersible pump, and the swing motor, which is totally being done in-house including the plastic molding. That's the inherent advantage which we have in terms of our backward integration as compared to competition.

We are, of course, already leveraging our existing business with most of these customers, because we have a fairly long-term business relations with most of the customers who are in the either chimney, for example, Faber is there, we've been supplying motors for a very long time, or oil-filled radiator heaters and air coolers. I believe this gives us a distinct advantage of even getting into a competitive market and creating a space for ourselves.

I hope it answers your That's

clear. Just to understand this better, having the fins and motors in-house, that of course gives us a lead time advantage.

I believe that would also help us in terms of the cost competitiveness. If you can share more on that, how much more competitive are we becoming cost-wise by having these things in-house compared to other players who do not have it in-house?

Of course, it will depend a little bit from product category to category. For example, in terms of OFR, since we see that we are easily about 7% 6% to 8% more competitive than imports for a totally locally made OFR heater.

Chimney, again, based on the current BOM and the current price valuation and the way which we have gotten, I think we are again at least minimum 5% cheaper than the competition. Air cooler is a category we're currently working on.

We are not started in the sense that the samples are now out, I don't have a number right now, but maybe in a couple of months, maybe by the next call, we can give you an update on that also. Chimney, currently, we are giving the final samples for evaluation and then start of production once the Bhiwadi factory goes online.

Fair enough. Sir, this you answered me for the new products, but if I take the existing set of products for lighting, for example, where I believe in a very short span of time, we have been able to add six new customers.

If you can explain how were we able to enter those players, what did we give them better compared to their existing suppliers?

Okay. See, in lighting, we have been in the lighting space for close to about 22 or 23 years now, we have a very long track record as a lighting company.

Of course, we were bound by the exclusivity agreement with Signify, over these last so many years, there has been a lot of these companies who've been approaching us for lighting, but because of our agreement, we were not able to service them. Now that that agreement is no longer there, I'm not saying fairly simple, but yes, we've worked on it.

We were always integrated in terms of lighting, we were competitive, but we didn't have the scale to match the other lighting players, we've worked on that. We enjoy a very good reputation in the market as a very premium quality supplier, at similar prices, we have been able to attract some of the customers from our competition.

Now, like I said, with the addition of a new resource who has a very proven track record of dealing with multiple customers in the lighting business, it has helped further attract these customers. Some of them have been existing customers, some are new additions, but with our track record of supplying to Philips for two decades plus, I think that's made it a little easier to attract these customers as a quality supplier of lighting products.

Fair enough. Just one last question before I get back to the queue.

For these six new lighting customers that we have added, I believe we have added maybe four of them and two are to be added by year-end. In FY '27, what sort of turnover can we expect from these six customers in lighting?

Currently we have already onboarded five customers, that means where the billing has already started, and we expect maybe to add another one or two customers. We don't want to spread ourselves too thin also with a very large number of customer base, but we'd want to focus on quality customers whom we can service and gain a fairly large business share in terms of volume.

That's our overall strategy going forward. In terms of revenues, like we said, we are currently almost on a 50-50 basis in terms of the revenues.

While we expect that the Signify lighting revenue will be at the current stage, I don't see it going up significantly, I think the new customers, we are looking at about a revenue of in terms of lighting from the new customers to the tune of around maybe ₹150 to ₹170 crores in the coming fiscal.

Okay. Why I was asking this is because in the previous concall, we shared that these six new customers can do at least 20% to 30% premium revenue of what Signify used to do monthly for us, which was ₹17 to ₹20 CR.

That numbers comes to

What we said that our monthly run rate by probably the year-end will be on par with what we were doing with Signify, let's say, prior to the Lightenium deal and the revenues declining. We are almost there at those levels, we are almost the revenues which we used to do with Signify.

Now with the addition and growing of these new customers next year, the revenue from them will continues to grow.

Got it. Fair enough.

That would be all. I'll get back in the queue.

Thank you.

Thanks.

Thank you, sir. The next question comes from the line of Ananya Nichani from Thinkwise Wealth Managers LLP.

Please go ahead, ma'am.

Am I audible?

Yes, ma'am.

Yeah. Thanks for the opportunity.

Sir, I wanted to inquire about your gross margins. They are about 40 basis points lower this quarter as well.

You've mentioned because of raw material pricing and some repricing with customers. Can you elaborate on that?

How do we look at gross margins going forward? What would be the steady-state basis, like if there's a new normal or something on that?

That is my question.

Sure. We pointed out in our opening remarks that our key raw materials, especially on the metal side, steel, copper, and aluminum have seen a fairly sharp increase.

If you follow the metal pricing market, most of these are almost trading at all-time high levels. The impact of this increase, which will be repriced subsequently in the next quarter, has been borne by us in the current quarter.

Depending on our contracts, some of them are on a monthly basis, some of them are on a quarterly basis. Wherever it was monthly, it has been repriced already.

Wherever it was quarterly, will be done in Q4, the current quarter of the year where we are. As a temporary time period, there has been an impact on account of these increasing RM prices.

Therefore, our gross margins have been slightly impacted, like you pointed out, to I think to the extent of 40 40 basis points.

In Q4 as well, we'll see a compressed margin sort of situation?

It's very difficult to kind of predict how RM prices behave. I'm sure you will appreciate that probably no one in the world can tell you where the metal prices will settle.

Assuming they stay steady, then there should not be an impact, because then the repricing will nullify any of that. Assuming they continue to keep on surging, there could be a further impact because what happens is last quarter or last month average is used in this quarter or this month.

Just to also give you all three sides of the coin, if there is a decline from these levels, then there could be an added advantage. Very difficult to predict where the metal prices will go, but I've explained to you broadly in terms of direction, whichever way they go, what the impact will be.

Got it. Got it, sir.

Thank you so much.

Thank you, ma'am. Ladies and gentlemen, if you have any questions, please press star and one on your telephone keypad.

I repeat, if you have any questions, please press star and one on your telephone keypad. The next question is from the line of Mr.

Kunal Mehta from Sunidhi Securities. Please go ahead, sir.

Hi. Very good evening, sir.

My first question would be I think in last year, we saw that there was heavy price erosion in the lighting segment. What is the current scenario there now that we have about five, six customers onboarded?

Are we able to get a competitive price or a better price, or it's still the scenario has been same?

In terms of lighting, just like now Akash was explaining, commodity prices has been at all-time high. Dollar is pretty strong.

In terms of electronics, again, the chip availability is becoming a little bit of a problem. Basically driven by a lot of the chip volumes are being now diverted to AI-related chips, EV-related chips, lighting is coming a little bit bottom of the line in terms of how the capacities are allocated by the chip manufacturers.

Lighting and general across all consumer electronic products are seeing a price increase. I think price erosion in lighting business is going to stop.

The prices are going to head north for sure. It's already started happening from this month.

If not this month, maximum, I think, next month, I expect at least a 4% to 5% kind of price increase across the board in lighting products. Some might be a little more, but bottom line, I think you will be seeing now prices going north in lighting and other consumer electronic businesses.

Okay. Sir, every quarter, take since almost Q1, we have been constantly downgrading our gross margin guidance for the year, from about 6% to 6.5% to 5.5% to 6%, now about 5.3% to 5.8%.

Is it only because of the raw material, or is there anything other than that also that is coming up? Is it capacity utilization, is it something else that is affecting the gross margins?

Look, just one quick clarification: it's not gross margin, I think you're referring to EBITDA margins.

Oh, sorry. I'm sorry, EBITDA margin.

Sorry, yeah.

Quick clarification. Look, it's probably like you pointed out a whole host of factors, it's probably a combination of that.

It's never really one single factor that plays out. On the lighting side, like we pointed out, the prices of electronics and the weak rupee is impacting us because there are certain imported content in our lighting business.

On the appliances side and the motors side, it is the price of metals that is very, very difficult to predict. Like I said, our job, we feel, is to give you a realistic picture of the business as we see it.

In that very spirit, we are sharing the situation as is. We agree that there is a slight compression that we have seen and that we do expect in our EBITDA from what we have forecast.

Our job is to lay it out to you as we see it clearly.

Okay. Sir, the impact of BIS, when do we see to take effect?

Is September of this year, or is it actual effect will come in the March of next year?

BIS in a lot of product categories is already implemented, you are seeing the impact. If you, let's say, for example, if I take the chimney business, there's a lot of local manufacturing going on.

Chimney manufacturing, motor manufacturing business has done extremely well last year. These are already happening.

In terms of OFR also, most of the appliances are now covered by BIS. For us, the next big growth boom which could happen because of BIS would be our FHP, fractional horsepower, motor business.

That is still not 100% under BIS. I think with those motors coming under BIS, there would be growth, opening up of local manufacturing.

Let's say washing machine motors, I think, would be a big category where the current local manufacturing, I'd assume, is maybe at between 5% to 8%, maybe max 10%. Air conditioning ODU motors, like the BLDC motors, says right now, I think more than 80%, 90% of the motors are imported.

I think that category will see a big impact if BIS comes in. I think it's slated to come in for August or September of 2026.

In terms of lighting, it's already controlled by the R number. Most of appliances are under BIS.

As far as the Chinese companies getting BIS, it's still a little difficult, although getting visas and things have become a little easier, but still there are certain constraints there. For us, the next big mover is going to be the motor business once it comes completely under BIS.

Sir, yeah, just on the FHP motor, I think this year we in this quarter, we saw about an 18% decline Y-o-Y. Most of it was due to, mixer grinder volume declining, and even the synchronous AC motors.

Do you do you see this that because of BIS, a lot of, companies, might have some kind of a captive FHP motor plant? How is our market share turning up because of this?

Of course, our third-party sales of motors has gone down, whereas there has been intercompany business, mixer grinders, those numbers have gone up, but of course we report it as a final mixer grinder sales. In general, small appliances, I think this Diwali was a little tepid, and the couple of months post Diwali, the demand of mixer grinder motors, chimney motors was fairly low.

It's now picking up. I think a lot of the bigger appliances in automotive industry did exceedingly well during Diwali, small appliances in general and chimneys had a fairly tepid Diwali.

Things are again now looking up, and I think again the motor numbers should go up. Like I said, for example, we'd also got into the cooler motors, but last year coolers and air conditioners both, in terms of the season, was fairly bad because with unusually long rainy season.

There was a lot of inventory carryover, actual manufacturing of air conditioners and coolers has now just taken off. Normally it starts in October, but this time I think it's got delayed by a couple of months.

Those categories of motors which we're expecting to pick up during the October, November, December period really did not happen, so that's another reason why FHP motors was a little down. Captive has gone up in terms of mixer grinders for us.

A little bit in the TPW segment also. Now we've consolidated the complete fan manufacturing in Ghaziabad plant, and those numbers are doing well, but it's being reflected in the overall fan business for us as a complete product.

Okay. Sir, now can we see the Bhiwadi plant start from April, or will there be some kind of a lag where you'll be shifting the chimney production from Ghaziabad to Bhiwadi, and new facility comes up?

Will there be some kind of a shifting lag where you'll be shifting some operations, or will it be a smooth transition?

We will be shifting our OFR business to Bhiwadi from

Ghaziabad plant,

yeah. Chimney is also happening in Bhiwadi, but still probably the commercial production will commence there.

Our date of commercial billing we've given as May 2026. Prior to that, there are a lot of regulations which have to be completed in terms of the BIS approval of the plant.

The manufacturing line has to be BIS approved, we need to do the preliminary sample build over there, then submit it for approvals, then get the line approved. This takes about two months' time.

We expect our internal trials to start somewhere in March of '26, and commercial production will go online May '26.

Okay. Sir, just one last question.

How are we on the working capital, and how is the progress there? Are we lagging because net working capital days as increased to almost 68 days from 59, is there going to be a little delay in execution of improving on the inventory and the payable days, or are we on track?

We are okay in terms of payable days. I think we are doing quite well.

Like we pointed out again in our opening remarks that there was certain abnormal inventory buildup that we have seen during the quarter towards the end of the quarter. We expect that to normalize within this quarter itself.

Hopefully, as at the end of March, we should be around the 50-day target that we have set out, on a net basis, of course.

Sir, I'll fall back in the queue. Thank you so much.

Thank you, sir. Ladies and gentlemen, if you have any questions, please press star and one on your telephone keypad.

I repeat, if you have any questions, please press star and one on your telephone keypad. We have a follow-up question from Mr.

Rahil Dasani from MAPL. Please go ahead, sir.

Yeah. Sir, this ₹150 to ₹170 crore target that we have from the new lighting customers for next year, is this dependent on prices improving like we said in the previous answer, or based on the prices as they are today?

No, the value which I have given to you is based on existing prices. In terms of the price increase which I said that I expect around, let's say, a 5% increase, I think this will be a hold.

I say this because I see some of it has already happened in this month. Max, China is going for the Chinese New Year, we will be getting new prices from China also once they come back to work, and that'll also determine how the lighting business moves.

In general, I expect a price increase across lighting categories, and my current number which I told you about ₹150 to, let's say, ₹170 kind of range, that is on the existing prices.

Perfect. Got it.

Sir, just a broad Sorry.

No. What I'm saying is that the numbers which I gave you are on the current existing prices, that means what was prevailing in the month of January.

Like I said, the price increase which I expect minimum around 5%, that could further push those numbers up.

Perfect. Got it.

Sir, just a broader question to understand the customer stickiness in this industry. Why did we lose Signify after such a long-term relationship, that too an exclusive relationship?

Why did we lose? A, let me answer that question.

A, we have not lost Signify as a customer. They

Part of that business.

Yeah. They continue to buy light fittings from us.

We are partnering with them for the fan business, and that's what that business is doing extremely well for both of us. We are still a strategic supplier for them, and they are approaching us for a lot of the new categories which they are looking at to grow their business.

Now, as far as the Lite-On part of the business is concerned where Signify has formed a collaborative venture with Dixon for lighting business, I wouldn't attempt to answer the logic behind that. That's how they've seen their lighting business, and probably some consolidation which they wanted to do of their plants in Baroda, where the conventional lighting business has gone down.

That's something best left to them. What I can assure you is that we are still a strategic supplier for them, a priority supplier.

If I add the fan business, a combined business with Signify is growing. Whatever we've lost in lighting, we've gained in the fan category.

Our business with Signify still remains strong and on a good growth trajectory.

Got it. Just to get my numbers clear, I believe you said that Signify used to be at least ₹19, ₹20 crores in totality for us.

From that, monthly they used to generate ₹19, ₹20 crores for us, and from that, annually maybe ₹40, ₹50 crores is the business that we lost, right?

Correct. We used to be, let's say, at the ₹240, ₹250 range,

so

that's about ₹240 for the lighting business, and currently we are at about maybe the ₹100, ₹120 kind of range in the lighting business. It could be a little plus, up and down, it depends.

What Signify has moved from us is the consumer part of the business, part of it, not entirely, we still work with them. The professional business remains.

If the professional business does well, then that number could further go up. Given the current scenario, that's what the business was around ₹240, ₹250 crores in the last couple of years, and now currently it's about looking at around ₹100, about ₹120 to ₹140 crores with them.

Perfect. Got it.

Now coming to the chimneys, ovens, and the OFR heaters, I believe the approval for that is going on at the Ghaziabad plant, and these products will be shifted to Bhiwadi once the plant is ready. Have we planned a number or expected number of customers approved us to achieve our ₹140, ₹160 crores of target in FY '27 from the Bhiwadi plant?

Two things. One, OFR is going to be a shifting of the business because it's already operational in Ghaziabad for last two years, and we've already planned the entire shifting in terms of the assets, and, of course, there's an approval process, so that's been planned.

Based on what we did this year and the forecast for the current year where we are again increasing our capacities, like I had mentioned that we are further increasing our capacities so that we kind of be the dominant player and not let too many people in, I believe we should be able to hit the numbers between OFRs and chimneys. The oven is not a very big business right now because in terms of oven, there are slight shifts in the consumption pattern.

By that, I mean in terms of oven, now you're seeing the air fryer is becoming very popular, and there's a new product in the market which is a combination of the air fryer and the oven, which is again catching steam. What we are looking in this cooking category is to start with the oven, and then maybe a couple of quarters down, we could look at adding the air fryer business which will further increase those numbers.

We are in active discussions with couple of key customers for the air fryer business as well. With these two put together the new products for Bhiwadi.

I think between OFR and chimney, we should be able to hit the guidance which we've given in terms of the turnover for Bhiwadi in '26-'27.

Got it. Just to summarize it a bit, only two products, OFR and the chimney, can do ₹70 to ₹75 crores each in FY '27, and this is while we are launching chimneys only in H2 FY '26?

Right,

please read it as combined between OFR and chimney, we should be able to do ₹170 crores. The air coolers and the oven business, which is a start, there's always a lag by the time you launch and you show the product and the approval process happens.

We are fairly confident that these two products alone should give us about a ₹170 crores kind of business outlook.

Got it. No, why I was asking for the split is because I believe we are to launch chimneys only in H2 FY '26.

That's only two quarters of numbers to generate the target. That's why I was asking for the split that we are planning for.

Currently not in a position to give you an exact split, maybe

No problem. Sir, at 25% to 30% utilization in FY '27 from Bhiwadi, what sort of EBITDA margins can we achieve there?

Look, we've mentioned that steady state, of course, will be say 7% plus, but obviously initially it will be much lower than that because of only part utilization of the plant. What we would ask is once the plant is up and ready, we'll have a better idea to give you some sense of what in totality for the year we can expect.

Just bear with us for another quarter

or

two. We're fairly close to

Yes, got it. Sir, how much additional capacity will this shift from Ghaziabad to Bhiwadi leave in Ghaziabad, and will that excess Ghaziabad capacity get utilized immediately, or else we will also see a drop in margins in that unit because of a lower utilization like we have seen in the past?

We already have a plan in place. Of course, this is going to be a fairly large revenue which will be moving out of Ghaziabad, we are looking at two product categories to offset and then further grow.

One, I mentioned that the fan business overall is doing fairly well for us, we are looking to grow that business. This year, I think we'll have 100% growth over last year,

and

so we are looking at another minimum 50% kind of growth, or maybe a little more, for the fan business. The second category is, in terms of the small appliances business, especially the mixer grinder category, we are looking to start operations out of our Ghaziabad plant also as well.

The logic behind this is that in terms of mixer grinder has a fairly large market share and it's a probably a round-the-clock kind of business. All our motors are being made in Ghaziabad for the mixer grinders.

We believe making the mixer grinder in Ghaziabad will give us certain logistics and overall increase the overall efficiency, we could offer it a better price. Secondly, of course, Baddi now does not have any excise benefit as such, and now the last couple of years, customers are also not very keen to buy out of Baddi because most of the sales happens in the bigger cities and in the metros.

The market is here, we want to move part of our mixer grinder business from Baddi, and we believe in Ghaziabad, we can give a better value proposition and we can further add and grow our mixer grinder business given the fact that motor is going to become in-house, of course it's saves on certain logistics and packaging costs, etc., etc. These are the two categories we are looking at, of course along with certain FHP motors like coolers and chimneys, etc., to not only offset the shift in revenue, but further grow the business.

Sir, if we shift the mixer grinder from Baddi to Ghaziabad, that will again lead to a lower utilization in Baddi, and hence we will get what we call as a reverse operating leverage, operating deleverage.

The complete mixer grinder operations will not be shifted out of Baddi. It's selected customers where the market share is not very large that will affect the Baddi business.

We believe that once we start the mixer grinders in our Ghaziabad plant, we will be able to attract newer customers, more customers who are currently not buying the complete product from us. They might be buying motors from us and some of them are buying parts from us and offering to brands.

We believe that we will be able to corner a portion of that business also.

Got it. I guess my point is that will we be able to continue with our 6% to 6.5% EBITDA margin at our existing two plants, if I forget about the Bhiwadi new unit where of course we will see a dip in margins and profitability on the consol level?

That's what I'm trying to understand.

Your point is well taken, sir. Like I said, on the existing business, we are reasonably confident, but on the Bhiwadi business, like I said, just allow us a quarter or two till the plant actually starts to give you an idea of what the EBITDA for Bhiwadi will be, and therefore what the consolidated EBITDA for the company.

Got it. Sir, how much is the trimmer

Pardon, sir. Sorry to interrupt.

We

request you to rejoin the queue, sir. Sure, sure, sure.

Thank you. For the next, we have a question from Mr.

Samrat Ashok from Janak Merchant Securities. Please go ahead, sir.

My question was on the motor division. Considering we have a lot of captive needs and there is a large opportunity to supply to the in-house appliance manufacturing opportunity which is arising out

of BIS Aap jis vyakti se baat kar rahe hain unhone aapke call ko hold par rakha hai. Kripya line par bane rahein.

Hello?

Please go ahead, Samarth.

Hello, am I audible?

Yes, sir, you're audible.

I'm sorry, there was a disturbance in between, may I ask you to repeat your question, please?

Yeah. Sir, it was related to the motor business.

Considering we have a higher captive requirement and we sell motors to other customers also, and because of the BIS regulation, there are new opportunities opening up. Are you going to expand your motor capacity further?

It is a better-margin product also for us. Any plans to expand capacity further?

We are looking to expand our motor capacities. Like I mentioned, we've already set up a line for cooler motors.

However, this particular season, the cooler industry started a little bit late because of the excess inventory built up in the pipeline because of last year's fairly dismal cooler. We are getting into the cooler business and cooler pumps.

We are getting into the BLDC chimney segment. We are looking at two more segments: one is the washing machine segment, and the AC ODU, IDU BLDC motors for further expansion.

Out of these two segments, washing machine motors are undergoing trials at our end, we are building up a line and getting our motors approved. We believe that once BIS comes into play in washing machine motors, a lot of local buying will start.

There our existing infrastructure is aligned to make these motors. However, BLDC AC ODU and IDU motors, we're a little bit of a wait-and-watch, because our existing infrastructure is not exactly suited to make this motor.

There is a fairly large investment required to make this motor at the same cost levels, let's say, at which China is operating. There we are at a wait-and-watch.

These other three categories, we are fairly confident. Two we are, of course, equipped to start, and the third one, we are getting our motors approved, and as and when the BIS kicks in, we will be in a position to start that as well.

From the DRHP, we had almost 10 lakh capacity of motors per month. How much we'll be expanding to?

Are you talking about expansion or utilization in terms of overall effects?

No, expansion.

I think, so, sir, the 10 lakh number that you're probably referring to is number one, an overall kind of number. It comprises of multiple types of motors and all.

Let me get back to you offline on that, because we are not seeing expansion on all categories of motors. There are like Sanjeev-ji mentioned, there are only three categories of motors where expansion was being undertaken or considered.

The numbers are not going to be very large, but we'll just get back to you offline with that number.

Thank you. That's all from my side.

Thank you, sir. The next question comes from Mr.

Kunal Mehta from Sunidhi Securities, a follow-up question. Please go ahead with the question, sir.

Hi. I just have one question.

It's on this personal care segment. In Q1 also, we saw dip in the volume, then even in Q3, because Q2 was the festive season, there was quite a lot of volume.

Is there some kind of a lower volumes scenario that we are seeing in personal care and trimmers and hair straighteners and hair dryers? Is the focus more on medium appliances and kitchen and home care, and personal care is kind of we're not having much focus to expand our customer base there?

No, it's not like we don't have focus, but look, the way we see it is these are vagaries of the market. Consumption has been a little bit erratic.

This is more an urban, discretionary kind of category. Much more urban, less rural.

Sometimes the way a urban customer allocates wallet share, automotive prices have come down, certain wallet share gets allocated there. You see temporary kind of mismatch.

It's very difficult for us to give you an exact, precise reasoning as to why it's gone down. Rest assured, it's not due to lack of focus.

We are working strongly with our customers to kind of drive this growth as well.

Have we added any customers in the personal care segment recently in the last year?

No, we have not been able to add any new customers, but we have been able to secure three new subcategories of projects within personal care. We should see some growth being injected once those projects go live in about maybe anywhere between roughly six months' time.

Okay. Sir, now do we see this order from the US because of the tariff situation again reversing?

Do we see that order from the US is soon coming in FY '27 for the fans,

yeah? Yeah.

We're very hopeful of that. This is just a very, very recent development, just about maybe less than a week a week ago.

Teams are, on the ground, already they're all in touch with with with our customers, but we don't have an exact, answer for you yet. I don't want to jump the gun and tell you that it is done.

Probably we are very hopeful that it's going to be done, but till it's done, I don't want to give you any any, premature indication.

Thank you, sir.

Thank you so much, sir. There are no further questions, sir.

Now, I hand over the floor to the management for the closing comments.

Hi, this is Kamal Sethia. Thank you for sparing your time and giving us an opportunity to address your questions.

I hope we have answered them well, and looking forward to next call to give you more updates on our company's performance. Thank you so much again for your time.

Thank you, sir. Ladies and gentlemen, this concludes your conference for today.

Thank you for your participation and for using Chorus Call conferencing services. You may disconnect your lines now.

Thank you, and have a pleasant evening.