Ladies and gentlemen, good day and welcome to Alicon Castalloy Limited Q4 FY 2026 earnings conference call. As a reminder, all participants will be in the 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 phone. I now hand the conference over to Mr. Mayank Vaswani from CDR India. Thank you, and over to you, Mr. Vaswani.
Thank you, Michelle. Good evening, everyone, and thank you for joining us on Alicon Castalloy Limited Q4 and FY 2026 earnings conference call. We have with us on the call today Mr. Sumit Bhatnagar, CEO, and Mr. Vimal Gupta, CFO. Mr. Sumit Bhatnagar will share his perspectives on the industry backdrop and the growth strategy following which Mr. Vimal Gupta will cover the financial and operational performance for the quarter and the full year. Before we begin, I would like to point out that some of the statements made in today's call may be forward-looking in nature, and a disclaimer to this effect has been included in the earnings documents that have been shared with all of you earlier. I would now like to hand over the floor to Mr. Sumit Bhatnagar. Over to you, sir.
Thank you, Mayank, and good evening, everyone, and thank you for joining us today. I trust all of you have had the opportunity to review the earnings presentation which was shared with you earlier. It's a privilege for me to address all of you as I take over as the CEO of Alicon Castalloy effective 1st of April 2026. I would like to begin by expressing my gratitude to our board, employees, customers, partners, shareholders for the trust and confidence they have placed in me as we enter the next phase of Alicon's journey. Alicon today stands on a very strong foundation built over five decades through deep engineering expertise, robust manufacturing capabilities, enduring customer relationships, and an unwavering commitment towards quality and execution.
As I step into this role, I do so with great respect for the legacy that has been created and with a clear focus on strengthening Alicon's scale capabilities and long-term relevance across evolving markets and technologies. Over the years, Alicon has evolved alongside the changing automotive landscape and established itself as a trusted supplier across both the domestic and the global markets. Today, the industry is undergoing a significant transformation driven by electrification, premiumization, lightweighting, energy transition, and increasing the technology integration. We believe Alicon is well-positioned and to participate meaningfully in these structural shifts given our strong product capabilities, diversified customer base, and growing presence in technologically advanced and value-added applications. Going forward, our priorities will remain centered around three broad themes: a deepening of customer relationships, expanding our capabilities and manufacturing footprint, and further centering our leadership and organizational depth.
On the customer front, I recently had the opportunity to engage with several of our global customers across both automotive and industrial segments, and the feedback has been highly encouraging. Increasingly, customers are looking at Alicon not merely as a component supplier, but as a long-term engineering and manufacturing partner capable of supporting their future growth plans. We are seeing opportunities expand across platforms, geographies, and product categories with customers expressing greater willingness to consolidate business with reliable and technically capable partners such as Alicon. This is true not only in automotive applications, but also in adjacent industrial and non-automotive segments, where our casting, machining, and engineering capabilities provide meaningful competitive advantages. As the relationship deepen, there is also a corresponding opportunity to expand our scale and capabilities.
Customers are increasingly engaging with us for higher value and more technologically advanced products while also encouraging us to participate in a larger share of their sourcing requirements. Aligned with this, we will continue to invest in capacity enhancement, automation, machining, and process capabilities, both organically and through selective inorganic opportunities where they strengthen our strategic positioning and customer relevance. Equally important is our focus on building the organizational capability and the leadership bandwidth. We firmly believe that creating a stronger and more future-ready organization is essential to support the next phase of Alicon's growth. Over recent months, we have significantly strengthened our leadership team across functions, including sales and marketing, product and process technology, program management, manufacturing, supply chain, tool manufacturing, operational excellence, and human resource.
The pace and quality of talent addition undertaken during this period reflects our intent to build scalable organization capable of supporting materially higher levels of growth in the years ahead. Turning to the broader operating environment, the global business landscape became relatively more challenging during the fourth quarter amid the volatile macroeconomic conditions. While the quarter began on a stable footing, the escalation of tensions in the Middle East contributed to increased uncertainty, resulting in volatility in energy prices, persistent inflationary pressures, and some disruptions in freight movement and supply chains. In contrast, the domestic environment remained comparatively resilient. India continued to be among the fastest-growing major economies globally, supported by consumption, government-led infrastructure investments, improving manufacturing activity and sustained momentum across several industrial sectors.
In addition, proactive measures undertaken by the government towards diversification of energy procurement and supply chain management have helped mitigate the broader impact of global disruptions on the domestic economy thus far. Against this backdrop, we witnessed several important trends emerging across the automotive industry. One of the most notable developments has been the renewed momentum in electric vehicles and hybrid technologies, bringing focus on energy security and fuel diversification has accelerated customer interest in alternate mobility solutions, resulting in stronger traction for EV and hybrid platforms across the multiple segments. At the same time, inflationary pressures across the value chain have remained significant. In addition to aluminum and related alloys, prices of commodities such as steel, copper, and other input materials witnessed meaningful increase. This was further compounded by high energy costs, freight expenses, packaging costs, and currency movements.
While aluminum price increases are largely pass-through in nature, there is typically a timing lag involved, whereas certain overhead-related cost increases are fully recoverable. Consequently, these factors could exert some pressure on the margins as we move into FY 2027. Excuse me. Energy availability also emerged as an important area of focus within the quarter. We use a variety of fuels, including LSHS, CBG, PNG, and LPG, mainly in process of melting, die heating, and heat treatment. We undertook several operational initiatives, including process modifications, optimization of gas utilization, and selective migration towards electric heating solutions in order to manage fuel availability challenges effectively. These measures help us significantly reduce the gas consumption without any disruption to production schedules to our customers. Importantly, during the brief period of fuel supply constraints, our team demonstrated some exceptional commitment beyond the workplace as well.
In several instances, employees and plant teams came together to support workers and their families by helping arrange essential cooking fuel and meals, ensuring that operational continuity was matched by care and responsibility towards our people and communities. While on the subject of energy availability and consumption, it's important to highlight that over 50% of overall power requirement is now being met through renewable resources, primarily the solar energy. The transition has significantly strengthened our operational resilience, and only a small part of operations is exposed to the risk of risks coming from the impact of volatility in energy prices, supply constraints, and disruptions due to the evolving geopolitical situations in the Middle East. Another important development during the quarter pertains to the labor cost.
Following the implementation of the revised labor codes earlier, the recent notification by Government of Haryana regarding an increase in minimum wages effective April 26 is expected to increase the labor cost at our North India factory at Binola by approximately 35%. There means a possibility of similar revisions being implemented across the states over a period of time. However, we believe that our ongoing investments in automation, productivity enhancement, and operational efficiency initiatives will help us meaningfully absorb the impact over the medium term. Despite these near-term challenges, we remain constructive on the medium-term outlook for Indian manufacturing and exports. Global OEMs are increasingly evaluating India as a reliable and cost-competitive manufacturing and sourcing hub as part of a broader supply chain diversification initiatives.
Additionally, developments around India–European Union Free Trade Agreement and progress towards U.S.-India Bilateral Trade Agreement are also encouraging from a long-term perspective. With its strong engineering capabilities, diversified customer base, and established manufacturing footprint, Alicon remains well-positioned to participate in these opportunities. Coming to the business development, Alicon has recently secured orders for two very distinct part numbers in this quarter. The first part is for a premium two-wheeler customer in India. This is a critical part for an upcoming product launch pertaining to higher CC platforms in motorcycles. The second part is supply of a Turbocor compressor component used in data centers. This is in the non-auto segment for Alicon and opens up a completely new product category for us as well as a new addressable market.
Our existing passenger vehicle programs with leading Japanese OEM continues to perform well during this year, supported by a strong growth in SUV platforms and hybrid vehicle demand. Given an increasing end customer preference towards hybrids and fuel efficiency mobility solutions, we believe these programs remain well positioned for continued momentum going forward. In the commercial vehicle segment, the program secured during the previous quarter from leading domestic OEM, along with the additional order from a prominent tier one supplier with a diversified Indian industrial group, are progressing well. Development and implementation activities have largely been completed, and these programs have now moved into the initial production.
Domestic CV industry volumes during the fourth quarter grew up by approximately 19.5% year-on-year, and Alicon remains well positioned to participate in this growth given our strong relationship across the leading OEMs. We also witnessed improved traction from our two-wheeler customers during the recent quarters. Alicon today supplies several critical products to leading players within the segment, and the strong recovery in industry volumes since September 2025 has translated into improved business momentum for the company. Consequently, the contribution of the two-wheeler segment to our overall business increased meaningfully during quarter four FY 2026 as compared to the corresponding phases last year. On the global side, we recently secured a e-axle housing program from a premium German automobile OEM, and has also progressed very satisfactorily with execution, moving in line with the planned timelines.
Successful delivery of these technologically advanced and value-accretive programs is expected to further strengthen Alicon's credibility and deepen customers' engagement and support additional opportunities across the global markets. Overall, we remain focused on a disciplined execution, operational excellence, customer centricity, and strengthening Alicon's positioning as a technology-driven manufacturing partner. Supported by a healthy order pipeline, strong customer relationships, and ongoing investments in manufacturing and process capabilities, we remain very confident that the company's long-term growth opportunities. With that, I would like to hand over the call to Vimal, our CFO, who will take you through the operating and financial performance for the quarter and the year. Thank you.
Thank you, Sumit, and good evening, everyone. We appreciate your participation in today's call to discuss Alicon Castalloy's performance for fourth quarter and for the financial year 2025, 2026. Despite a relatively challenging global macroeconomic environment during the quarter, Alicon delivered a resilient performance and concluded FY 2026 on a strong note. While international business witnessed some recovery in quarter four, growth during the period was primarily driven by robust momentum in domestic market across key automotive segments. For Q4 FY 2026, Alicon Castalloy reported a total revenue of INR 495 crore, reflecting healthy growth of 16% year-on-year. This also represents the highest ever quarterly revenue reported by the company. A part of increase in top line during the quarter was attributable to pass-through impact of higher aluminum and alloy prices.
The domestic business remained the principal growth driver during the quarter, supported by strong demand across passenger vehicle and commercial vehicle segments, along with improving traction in two-wheelers. On the international side, customer-specific issues and relatively softer demand conditions in select export market continued to weigh on volumes. The strength of domestic business helped offset a significant portion of these headwinds. From a profitability standpoint, gross margins for the quarter stood at 45%, reflecting a reduction of 248 basis points on year-on-year basis. Margin during quarter was influenced by a combination of factors, including change in the product mix, a relatively higher contribution from the domestic and two-wheeler business, and the impact of elevated aluminum prices.
While higher raw material prices contributed positively to revenue growth on an absolute basis, they had a moderating effect on the gross margin due to the pass-through nature of aluminum pricing. On a quarter-on-quarter basis, gross margin moderated by 216 basis points from 47.2% in quarter three to quarter three of FY 2026, reflecting changes in product mix and the base effect of higher aluminum prices. EBITDA for quarter four of FY 2026 was INR 46 crores, representing a year-on-year decrease of 3% due to the inflationary trend in cost heads and base effect of higher aluminum prices. Sequentially, EBITDA improved compared to quarter three FY 2026 as operational performance strengthened during the quarter offsetting the other co-factors. EBITDA margins broadly mirrored the trends seen at the gross margin level due to the evolving business mix and raw material pricing dynamics.
Profitability during the year also continued to reflect investments being made towards future growth initiatives and operational upgrades, including technology enhancement programs, automation initiatives, capacity expansion, employee capability building, and business development efforts. While these investments impacted near-term profitability to some extent through higher depreciation and operating costs, they are expected to contribute meaningfully towards productivity, efficiency, and scalability over the medium term. At the same time, strong working capital discipline and prudent balance sheet management contributed towards lower finance costs during the period. Profit before tax before exceptional items for quarter four FY 2026 stood at INR 10 crores as compared to INR 11 crores in Q3. On a year-on-year basis, PBT was lower by INR 4 crores, largely reflecting the higher depreciation. Profit after tax for quarter four FY 2026 stood at INR 8 crores compared to INR 9 crore in quarter four FY 2025.
On a sequential quarter basis, profit after tax in quarter four was higher by 141% compared to PAT of INR 3.3 crore in quarter three of FY 2026. On a full year basis, Alicon Castalloy reported a consolidated total income of approximately INR 1,784 crore for FY 2026, reflecting year-on-year growth of approximately 4% over FY 2025. The strong performance during the second half of the year, particularly in the domestic automotive market, contributed significantly towards top line growth. Additionally, higher aluminum and alloy prices also had a positive impact on reported revenues during the year due to pass-through pricing mechanism. EBITDA for FY 2026 stood at approximately INR 203 crore, registering a year-on-year increase of 3% over INR 190 crore reported in the previous financial year.
Profit before tax of FY 2026 stood at INR 55 crore as against INR 62 crore reported in FY 2025. After absorbing INR 8 crore account of new Labor Code and exceptional items, PAT was INR 34 crore in FY 2026 as against INR 46 crore reported in FY 2025. In view of the company's resilient performance despite a challenging operating environment, the board of directors has recommended a dividend of INR 2 per share for FY 2026. Capital expenditure during the FY 2026 stood at approximately INR 135 crore, with investment directed towards automation initiatives, enhancement of machining capabilities, capacity augmentation, and readiness for upcoming customer programs. Simultaneously, the company continued to invest in research and development, localization initiatives, and digital manufacturing capabilities with the objective of strengthening long-term competitiveness and operational resilience.
Operationally, FY 2026 was characterized by continuous focus on execution excellence, productivity enhancement, and throughput improvement across manufacturing facilities. Despite demand softness in certain export markets, the company worked closely with customers to maintain product stability, optimize capacity utilization, and ensure operational efficiency across locations. During the fourth quarter, we also undertook a comprehensive review of our order book to improve visibility and enhance the quality of the executable pipeline. Certain completed programs naturally moved out of the order book, while a few programs where customer volumes had not materialized despite advanced development stage were also rationalized and removed from the backlog. These two include two large global players as well as two prominent customers in India. We are hopeful that these programs will revive at the later stage, at which we will add them to our order backlog again.
Following this exercise and including recent order wins, Alicon executable order book stands approximately INR 7,600 crores as on March 31st, representing a net executable orders over a period of five years, from 2026-2027 to 2030-2031. This does not include programs that are currently ongoing and are already part of revenue for FY 2026. Overall, while global markets continue to remain somewhat volatile in the near term, the domestic automotive industry continues to exhibit healthy momentum and customer demand trends remain encouraging. Supported by a healthy order book, healthy order pipeline, strong customer relationship, and continued investment in technology capabilities and capacity expansion, Alicon Castalloy remains well-positioned in sustaining growth trajectory over the medium to long term. With that, I conclude my remarks. We can now open the floor for questions.
Thank you very much, sir. Ladies and gentlemen, we will now begin with the question- and- answer session. The first question is from the line of Raghunandhan NL from Nuvama Research. Please go ahead.
Good evening, team. Thank you so much for the opportunity. Firstly to Sumit, sir. Thank you, sir, for the detailed opening remarks and highlighting the key focus areas. Best wishes for the days ahead. My question is: How do you see the medium and long-term targets potential for the company? For the near term, how do you see the FY 2027 revenue target, given that, there is a large, pending order book of INR 7,600 crores at your disposal? Thank you.
All right. Thank you for your question, Raghu. As I've said that I have recently taken charge in Alicon, and it's a very valid question coming from an investor in terms of understanding how do I see the midterm and long-term prospects of the company. So if I look at FY 2027, the year which we have just started, the first approach for me is to make sure that we build a very, very strong foundation. Alicon has been there for more than five decades, so I would not say that while we don't have a great foundation, but I want to revisit and relook at all the processes and make sure that we have the right abilities in terms of technology, processes, human capital to make sure that we are all ready for a big leap.
This is a year for Alicon to refocus, reset and rebuild. That's number one. Number two, if you really look at the short term, the first most important thing for us at Alicon is to expand our footprint. You will see 2026, 2027, definitely minimum one new manufacturing factory site coming for Alicon. That is step number one to answer your question, Raghu, that how do we take care of the backlog order books. That's step number one. I've already mentioned in my speech that we have made serious recruitments at various levels across Alicon, and this is basically to meet to this particular requirement. Definitely India is a growing market.
In past there are some customers with whom we have not been seriously engaged, but I can only tell you today that we already have won initial businesses with them, and they're very keen to really expand their business portfolio with Alicon. This is where I'm looking in this year to first grow in the domestic business. That's number one. Number two, last year, I think we have already said in the previous call and also in this call that because of some geopolitical situations, the global markets did not do so well for us. We have always strategically been focusing a lot on the European markets and the American markets, but we have not done to our expectations for various reasons, which we have also told in the past.
This year we are seeing for those things to also revive for us. While 2026, 2027, I don't want to make promises of an extraordinary bumper year for Alicon, definitely we are looking for the reasonable growth and our focus is also going to be relook at our margins and further strengthen them in a big way. This is what I can share with you at this point of time. I think you also asked me, Raghu, visibility on our growth for FY 2027. Definitely we are looking for a modest growth of around 8%- 10% without taking care of the aluminum volatility. It's neutral because we don't know to what extent aluminum will grow, because that would further add up to the top line.
This is what we are looking at at Alicon for this year. Once you talk about the long term, which is another right question, there are some strategic movements which we will make and, which will be a kind of more forward integration of our products, which we are very seriously looking at. At the right time, we will also let all of you know that what we are planning. Definitely we want to strengthen our European base as well. Our team has been aggressively working with the European customers and we have already made some good headway with them, and this should convert into results in the near future. I hope that answers your question, Raghu.
Yes, sir. Thank you very much. Very helpful and gives us an insight into your thought process. To Vimal, sir. Sir, in terms of Q4 results on the cost side, other expenses seem to be on the higher side compared to last quarter or last year. Can you indicate whether there was any one-off item or any expense which is not likely to continue in the coming quarters?
Yeah, Raghu. In quarter four, there are two aspects we have to see. One is that like Sumit has explained, there is impact of the aluminum. There is a huge price increase we have seen in the aluminum in the quarter four due to this Middle East war. Approximately we are seeing that INR 30 crores- INR 35 crores when we compare with the quarter three. That is the one part where we can see because in the results there is a increase in the raw material cost. Our gross margins are down, what I was explaining in my notes. That is one part. That impact. Second, when we are talking about the operating cost, this manufacturing and other cost.
You know, lot of things we have reviewed and some one-time cost we have considered and maybe some provisions we have made. Approximately INR 15 crores additional cost. Those were not there when we compare in the quarter three or maybe earlier quarters. That has come in and we have considered in quarter four. That is the major impact that we have seen in this.
Thank you for that, sir. This, aluminum, would it be three-month lag for the indexation pass-through to customers?
No, because earlier some customers was online, means, month-on-month basis, some were on quarterly basis. After this, big increase, what we have seen from the mid of March, almost customers they are on the same month-on-monthly basis we are doing.
Wonderful, sir. There should be some pass-through benefit we should see in the going ahead, especially that should help the gross margin.
I wouldn't say the benefit. I'd say that there will be no loss.
Understood. Understood, sir. So in your gross profit
Yes.
should not be impacted.
Yes. Yes. Yes.
For FY 2027, I understand there will be this numerator denominator effect, that arithmetic effect because, you know, your aluminum prices go up and, at the same time your costs go up. Broadly, what is the range of margin you would expect for FY 2027? Also, given that you are working on building your capacities, what is the CapEx we should work with for FY 2027?
First is, Sumit has explained about one is that the top line 8%-10%, and he has explained totally based on without taking the impact of the aluminum prices. We don't know in the March we have seen so big jump. In April I have seen approximately again further 15%, 20% increase and May also again increase. There is a huge jump maybe when we will go for the quarter one review, we will see a huge jump in the aluminum prices. We are not bothered about that, and we are not even considering in our calculations all this. That is the one part.
Whatever Sumit has explained, the growth that is purely without taking the impact of these aluminum prices. On the EBITDA side, what we are talking about the margins. You see the when we are talking, saying that the 8%-10% increase in the top line, so approximately 20%+ we are expecting increase in this EBITDA margins. That we are talking about the absolute amount. Understood?
Got it.
The absolute amount. Maybe as a percentage, maybe 1.5% or whatever it comes.
Got it, sir. Got it. No, this is very helpful. On the CapEx side, sir, how much you'll be spending, and what are the areas where it will be spent?
Maybe Sumit would like to answer for this.
All right. Raghu, so this year our capital expenditure are mainly going to be first on increasing our capacities, especially on some of the specific manufacturing processes of die casting. We will also be putting our CapEx on increasing our machining abilities and machining capacities. Of course, we will be coming with a new manufacturing plant. Other than this, we are keeping aside a good CapEx for strengthening of our cybersecurity. We are also going to be spending a substantial amount on automations, because it's very clear that in future we want to have more and more automated processes to reduce the involvement of people in core manufacturing areas. If you ask about the numbers, I think, give and take, we are looking for a capital expenditure of anywhere between INR 130- INR 140 or INR 150 crores.
Noted, sir. Thank you. This is very helpful. I'll come back in the queue for more questions.
Sure.
Thank you. The next question is from the line of Riddhesh Gandhi from Discovery Capital. Please go ahead.
I Sir, apologies that I joined the call slightly late, so apologies if it's a bit of a repetition. Just wanted to understand what exactly has gone wrong over the last couple of years. Given that the Range Rover issue should now have been resolved by Q4, you know. You know, overall, if you look at numbers for most of the auto components players, both exposed to the local markets or global, all the Q4 numbers have been extremely strong. Just wanted to understand what has really gone wrong and what are we doing to actually fix it.
All right. I think, Riddhesh, I'll take this question. While your question is pertaining to the past period, I would still attempt to give a fair answer to this question. Riddhes h, in the last couple of years, I think somebody can please mute it. I can see a lot of noises. Yeah.
Riddhesh, sorry to interrupt you, sir. Riddhesh, I would request you to kindly mute yourself when the management is answering. Thank you.
Sure. Thank you. Thank you, Riddhesh . All right. If you look at the past couple of years, our strategy has been very clearly more focused in two specific areas. One is we have been really pushing very hard to grow in the global markets. Number two, we have been pushing very hard to grow on high value addition products. If you really look at Alicon's history for last few years, most of the new developments have happened in the passenger vehicle segment, where we have won businesses with some of the larger OEMs in higher ASP. At the same time, we have won multiple businesses in Europe, especially in the EV side and also on the non-EV side. This is where we have put all our energies on.
Now, you also spoke about what went wrong with the Range Rover and Citroën C4 . It's a very specific question you have asked. I think while you are aware that the entire JLR was severely hit for more than a couple of months because of some challenges, what they had felt or they realized internally, but the vehicle is yet to be launched in the market. The good news is, we have recently seen the vehicle. We had an opportunity while we were in JLR. The vehicle is due to come on the roads very soon. Our supplies have started. Eventually, there has been a delay of significant delay of, I would say, in short, but for this product has been one of the most complicated development of Alicon so far.
This product so far has not been developed by any other Indian companies until today. I think it's a matter of lot of pride for us that we have done it, but there has been 18 months delay in the development, which primarily happened from the customer side, but now this has been sorted. The vehicle manufacturing has started. The launch will be announced very soon, and you will also hear from them directly. This is something which has really put a big dent to our growth journey or our efforts. Other than this, because our focus was mainly on the export market and unfortunately, we did not get enough lifting of the material from the European and the U.S. markets for various reasons, including the tariffs.
Overall, wherever we have put more efforts, those places have not yielded enough results for us. Now the question is, how are we fixing it? I already explained to you some time back. We have now gone back to some of the major Indian OEMs, where we have traditionally not been supplying. I'm very happy to share that we already have one business from each one of them, which is already into series production from last couple of months. This is definitely a beginning with them. We are now putting equal efforts and energy also on the domestic markets. That we create enough balance between our European plants, U.S. plants, as well as the Indian plants. In this process, we also realized that we need more capacities. We need a better footprint.
We already have now gone ahead. We have already earmarked the place. The factory has been finalized. By end of this year, our target is to have minimum one. It could be more if everything falls right in place for Alicon. Yes, that's true that maybe some of the more strategic plans which Alicon has done in the last two years, they have not yielded the results that they were anticipated, but they are not failed initiatives. The results are delayed, and we will see the results now in the coming years for sure.
Got it. Understood. Sir, just to understand, I understand that obviously the entire JLR issue was completely out of our hands, and it's a high revenue and a high, high margin business and, you know, actually the tariffs and all of these implications. Even given that you're still, like, guiding only towards an 8%-10% growth, wouldn't we have to then, make up for the, like, lack of growth over the last year and then have growth of this year? Therefore, shouldn't this year the growth be materially higher with regards to what you're then guiding towards?
Yeah, Riddhesh.
Given some of the issues resolved.
Sure. That's a fair question. As I've said that, the capacity expansion has started, but you can understand in our kind of industry, once you start the expansions, they take some time to yield positive results. I'm very hopeful that towards the end of this financial year, those steep growth increases you will see coming up. It cannot just happen suddenly on a given day. Yeah, but I think it's a fair question, but I can only tell you that Alicon is now completely geared up for this growth, and you will see this very soon in the coming future.
Sir, this exceptional item which we had on the write-offs, which you were sort of indicating at. Just wanted to understand, is that behind us or are there other write-offs we still need to do in terms of cleaning up the balance sheet?
I.
Just want to understand what were those write-offs which were done.
Riddhesh , I think Vimal did explain some of the extraordinary write-offs which I have done, but I can only tell you that we are not looking for any further write-offs in this year. We have recently done our audits, and I am quite hopeful, and I believe we have just cleaned up whatever has to be done, but I'm not looking for any such events coming in the next financial year.
You know, just to understand, you know, what is given that now the, you know, the JLR orders will start, which is higher profitability, given the exceptional write-offs which we have taken last year, again, we're guiding towards just a very small enhancement in terms of the margin. You know, we're just being conservative in terms of our guidance because, I mean, it's just appearing to be, you know, given all of the CapEx which we've incurred over the last few years, it's not, like, reflecting in our return ratios and our growth or our profitability. Are we just being conservative on our guidance, or were we sort of off on our expectations with regards to the returns we can make on the CapEx?
Yeah, Riddhesh , I can only tell you at this point of time that the bottom line and the and the profitability, as I've also said in the beginning, is going to be one of the major focus areas, which is not limiting to getting more businesses, but also to improve our internal efficiencies, productivities and other things. We have plans. We are working on them. What I have shared with the the entire forum is something which we definitely are looking for. Definitely I can only tell you that once it comes on taking internal goals and we will take much more aggressive targets. I think at this point of time, what I have shared, I would really be going hard to meet them. Yeah, your point is right. We will not take any conservative targets for the organization. We will be very aggressive and we will see.
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Yeah. I think, maybe, by quarter by quarter, I think you would be able to see that. Still we are in a state where the market is volatile. We still have not completely got over from the energy prices and the, and, the various fluctuations which have happened. We are still dealing with them. To really commit something under this market volatile situation is not very fair on my side. Still under these circumstances, we are going to do our best to achieve, great results for Alicon.
Okay, sir. That is from me. All the best.
Thank you.
Thank you. The next question is from the line of Preet Pitani from InCred AMC. Please go ahead.
Hello, sir. Thank you so much for the opportunity. Sir, I would just like to ask, like last three years we have done around INR 500 crore, approx INR 500 crore of CapEx, which has been our entire profit for the last 10- 12 years. Just want to understand what exactly. Despite this CapEx, we are now at 78% utilization. What exactly this last five years CapEx was and how this has helped us? Because our margins are also at the bottom end of bottom end. How exactly this CapEx has helped us? Just wanted to understand.
All right. The thing is whenever we do a capital planning, generally you can believe that almost 50% of the capital planning is always in CapEx. These are the machines and equipment which really need to be upgraded over a period of time.
This is one area where the CapEx had been spent, I think, which is a natural course for any organization. If you talk about the new CapEx, yes, we have invested significantly on projects like JLR. We made some significant investments for some more customers from Europe, which have already started their sales. New projects is a place where we have invested a lot. We have been investing on automations. We are actually going to increase it by further more extent. While I don't have a immediate breakup of all the numbers what we have said, but I can only tell you that we have been very vigilant in spending, and we also look at the returns, what we need to deliver as any CapEx which has been invested in the organization.
You can be rest assured that all the capital investments, what we are doing right now, is going to have a good rate of return. Yes, for whatever reasons, we have not seen those reflecting in our bottom line, but I think 2026, 2027, you would see that as well. This is what I can share with you at this point of time.
Got it. That was helpful, sir. Another question would be line on the entire year, FY 2026. Just wanted to understand that out of INR 1,700 crores of revenue which we are doing, what would be the one-off revenue, like you mentioned in the quarter three call, that base has some one-off revenues, one-time revenues. Just wanted to understand in this entire year, was there any one-off orders? Also on the expense side, apart from the exceptional loss of INR 75 crores, was there any one-off cost which we have incurred, which will not be coming in next year?
Yes. Can you please explain again your question? The first is about the revenue.
The one-off revenue. I think his question is, was there any one-off revenue which only happened once?
Not in this year. In 2025, 2026, it was not there. I'm not That's an event which has happened. If you can please be specific about your question.
On the expense side also, was there any one-off expense which was in entire FY 2026, which will not be recurring in the coming year?
For the full year, like, I have explained, INR 15 crores in the quarter four. When we worked out for the full year, it was approximately INR 25 crores-INR 26 crores because like, Wage Code Act or some other, right, or some one-time increase in the costs. Those things have happened. We have agreed to just approximately one-time expenses during the full year is around INR 25 crores-INR 26 crores.
Okay, thank you, sir. On the next line, we have mentioned some few con call few quarters back that we have received a Daimler order, and this will be starting in FY 2026, quarter three, quarter four. Has this order started, and how big is this order?
This order is executed now, and I mean, there are only 18 parts out of that, 60% PPAP is through, and parts have streamlined. Another eight parts will go in next two quarters. On a peak sale, this would be somewhere around INR 80 crore-INR 90 crore yearly sales. I'm hoping, I mean, second half of the next year, this will come into peak. Yes, what we also see the numbers are pretty well. I mean, projects which we have kicked off, what we were anticipating the numbers, I think the hit rate is more than 110%.
Got it. Got it, sir. Apart from this, just wanted to understand, last full year, our revenue growth was only 4%. Our 80% of business is coming from domestic, which has grown at 10%, 12%. Are we losing any market share on the domestic upfront? If you could explain it?
We have not lost any market share. I think, if you look at, in fact, our two-wheeler segment, we have done better than last year, and in fact, our market share has gone up. Even in passenger vehicles, the models where we supply, in those models, we are exactly at the same market share as we used to be earlier. Yes, since we are not there in all the models, the corresponding growth is apparently not visible in our growth. In the PV side, we supply to some bigger OEMs, in some specific models where our shares are substantially high. This could have been the reason why the entire growth is also not reflecting in our domestic growth. Th is is something which we are now planning to correct by adding new part numbers and new products to other OEMs as well.
Got it, sir. On this follow-up thing, if you could just mention for full year FY 2026, what was our domestic growth? What was our export degrowth? Yeah, if you could also mention about two-wheeler PV. Anything quantitative would be suffice.
If I see segment-wise bifurcation for this year, two-wheeler, yeah, there was a little up because of the market pull up, so it was near about 42%, followed by passenger at 34%, roughly 17%-18% was commercial. Also we noticed little traction in the non-auto to 5%-6%. If I read this in terms of the market, yes, if I consider even the deemed export, indirectly what we share to the global region, it's somewhere around 20%.
Got it. Sir, on the last question on the side of order book, we have mentioned that we have around INR 7,600 crore of order book executable over the next five years. Just wanted to clear if my understanding is correct. Our current base of FY 2026 revenue is around INR 1,800 crore, that means we can, with no new orders receiving, we can clock around INR 25,000 crore of revenue by FY 2031, INR 1,800 currently and INR 7,000 base. Is my understanding correct?
No, I'll just, and put so share some more remarks on this subject. Basically, yes, we were following on the new businesses, whatever we have acquired over last two, three years. The only thing what we have done is we have just revalidated with the numbers because lot of dynamics of the market, especially the newer parts were changing. What we have noted now, if I consider period from 2025, 2026 to 2030, 2031, that is six years. I see a visibility of these new orders with to a cumulative sales revenue of around INR 7,600. This is for six-year period, not five.
Okay.
Mainly I think that because earlier when we were talking about so many orders like, because we have seen the market is not as grown over what we were thinking for the EV. That already we have scaled down many, some new intents were there. Even they have even closed up their projects. Everything we have updated, and on that basis we have worked out these numbers. Another is that, now we have started, we are in process of negotiating for many new orders in the like Sumit has explained in the Euro-European market and the U.S. market. Hopefully this will be a very good new order book further in 2026, 2027 or maybe in 2027, 2028 we will see.
Got it, sir. Just wanted to understand like INR 1,700 crores -INR 1,800 crores of revenue we are doing currently. We have INR 7,500 crore of order book in six -year period, which implies I know that order book cannot be evenly spread, but that implies INR 1,300 crores-INR 1,400 crores of revenue in one year. Just wanted to understand that cumulative revenue will go from INR 1,700 crore to INR 3,000 crore or from INR 1,700 crore to it will go to INR 9,000 crores-INR 9,500 crores.
No, no. On year-on-year basis, maybe INR 3,500 crore.
INR 3,000. We are expecting with no new order flows, we are expecting top line to double in next five years.
Based on the current new order book.
Based on the current order book.
What I've explained, like we are in process of finalizing very big, lot of new orders in the coming this year as well as in the next year. That will be added up.
Got it. You mentioned to some previous participant that we are planning of INR 140 crores of CapEx in this year, around INR 140 crores. What this CapEx is for current year? It is a maintenance. How much would be maintenance CapEx? How much would be the CapEx for new plant? You mentioned something about new plant. If you could just give some idea about the same.
Just to give you a rough estimate, around INR 50 crore of CapEx is going to be a maintenance CapEx, and rest of the CapEx is going to be for the new projects and expansion.
By this INR 90 crores of new CapEx, how much revenue we could target or at its peak level?
See, this is too early to comment on this. Right now our objective is to create enough capacities to answer to lot of requests which are coming from Indian and global space. Because the CapEx what we are considering is not the complete CapEx which is supposed to be allocated to this plant, it is going to be much more as the time goes. To very specifically tell INR 90 crores and in relation to the revenue, it is slightly tough for us, but it is a strategic move to create bigger and bigger capacities to answer all the RFQs or the inquiries which are coming from all over the places.
Got it, sir. Generally, what kind of asset turnover we get from this type of project?
Generally from the new business, our target is always between 2.5x -3x at least.
On the basis of old gross block, how much we can do maximum?
Sorry, old?
The existing assets. I think your question is how much maximum we can do on our existing capacities or assets?
Yes. Yes.
From the existing capacities, what we are talking about, asset turnover you are talking about, then it is below than two that you have already seen at present. You know that the real issue is that whatever the new orders are coming, those are the very complex parts. We need new investments for that new kind of technology, machining, lot of machining we have to do and lot of automation. That is the main reason maybe you cannot see a big jump in the asset turnover ratio, but we have to focus more on the margin side.
Got it, sir. Just on the margin upfront, currently you mentioned we have done peak margin of 12%, 12.5%, 13% kind of EBITDA margin in FY 2024. I think we are projecting for 10% top line and 20% EBITDA margin growth. That brings around 12%. Although we had INR 25 crores of one-off items in the previous year. What is stopping us from making the margins of 13%, 13.5%?
I think I've already explained to you. Thing is, nothing is stopping us. We really want to do more and more. Currently, I cannot give you that number in current situation where we are still surrounded by a major volatility. I have already said. What I have said is something which we at least want to deliver, which is a good step up on the last year. I can only assure you that quarter on quarter, I would like to come back to you.
Showing how much progress we are making on that. The internal challenges to our team is going to be far more aggressive. Yes, sitting today while we still don't have answer to a lot of macroeconomic situations, it is very tough for me to commit a number to you, which I can't foresee very clearly today. Maybe as the year goes, maybe I will be more confident to give a very precise answer to your queries.
Fair point. Fair point. Thank you so much for answering my all questions. I'll join back in the queue if I have anything. Thank you, sir.
Thank you. The next question is from the line of Bhavya Doshi from Sushil Finance. Please go ahead.
Good evening, thank you for the opportunity. My first question is that most peers have talked about the revival of the U.S. commercial vehicle cycle. Are you seeing a similar positive trend for your commercial vehicle sales in FY 2027?
Yes, we are noticing. I mean the newer engines which we have recently launched, there is a good demand for those number. Not just the Daimler which I mentioned, but yeah, there are further accounts also, like we supplied charge air cooler tanks to the other locations. We also have noticed the quantum of RFQs from such accounts has increased. We are expecting some, I mean, very soon some LOIs from these regions further so that we can add little of the sale in the coming quarters going forward. Touch wood we see a good visibility going forward from that perspective.
Bhavya, just I would like to further explain about this. We have to correlate what Rajiv and Sumit is saying because this is a very crucial that Sumit has explained about the new plant. What we have seen then when any new customer comes for the new business, always face a challenge of the capacities. Unless until we have the new plants, new capacities, we cannot increase our top line. That is the first step we have taken in this year. What we are seeing in the last six months or maybe especially in the last three months, huge customers are coming up with new businesses, new parts, high volumes, and at this moment, lot of demand is there. But just to meet those demands, we need capacities. That first thing we are fixing in this year.
Okay. Thank you. My next question is, there has been a significant growth in the quarter for top line year-on-year as well as quarter-on-quarter. Is this driven by volume growth or value growth?
This is a mix.
Yeah.
If I talk about the domestic market, yes, we noted a good jump from the two-wheeler segment, yeah. If you talk about our traditional partners like Royal Enfield, the numbers were high. Even Hero numbers were high, we were able to grab little. We definitely focus on higher share of business with such accounts. Even we noted a good momentum, yeah, if you talk about passenger or commercial. I mean, we have noticed, I mean, be it Mahindra or Tata, both are aggressively focusing to become a number two in this market. Touch wood we have recently added few parts from both the accounts. This is adding us on the top line. On the third front on commercial, yes, lot of investment projects from the government we have noticed, yeah. That also is driving.
Just to, if I, if I talk about non-auto also, I see, good numbers, even segments like energy. That has supported us a little on that front also and accumulating toward the top line.
Okay. Thank you. Can you tell us what are the orders added in FY 2026?
Yes. Last year we have added around 14 parts with seven customers. This includes both domestic and global accounts. This even includes, I mean, parts from the niche market, like from Lamborghini or Audi for the European location. Good, yeah, good momentum we have drawn over there. This parts will fetch near about a sale of around INR 140 crore at the peak. Yearly sales of INR 140 crore at the peak. If I talk about over a period of, say, three to four years, this will fetch us near about INR 500 crore-INR 600 crore.
Okay. Thank you for the answers. That's it from my side.
Thank you. The next question is from the line of Nishita from Sapphire Capital. Please go ahead.
Yes, hello. I had a question on your order book. You mentioned that we have the order book of INR 7,600 crores. Does that also include the order from JLR?
Yes, it includes the orders from JLR also.
What is the amount for that, if you can, like, give us that amount?
JLR, when we I mean, when we got the LOI, this was somewhere this, I, if I talk about JLR precisely, this would be.
No, I think I should pitch in. I think we cannot reveal a customer-specific number. I think that's a legal bonding between us and JLR. My apologies for that because, that would not go, again, in line with the contract. Sorry, I can't share that with you.
Okay, okay. No problem. The another question I had.
Yeah.
You mentioned that we'll have 1.5% of increase in the EBITDA margins. Is that on the current margin of around 11.4% that we did in FY 2026?
First of all, you have to understand what are the real margins in the quarter four or maybe for the full year, like we explained, because there is impact of the aluminum as well as some one-time costs. When we are already at that level and at least maybe when we are talking about the 11% margins, they may be taking the impact of the externality cost or even the impact of the aluminum. 1.5%, maybe, 12.5%-13% we can say for the year.
Okay. Okay. Understood. Yeah. That was it for now. Thank you.
Thank you.
Thank you. sir, we have one more question. Can we take that?
Okay. I think we can take the last one.
Sure. Ladies and gentlemen, this will be the last question for today from Preet Pitani from InCred AMC. Please go ahead.
Hello, am I audible?
Yes.
Yeah.
Please proceed.
Thank you so much for the opportunity once again. Sir, just wanted to ask last one question. On front of debt side, we are planning of around INR 140 crores of CapEx, and we have very small amount of cash on the balance sheet. Just wanted to know this will be taking a debt for this, or how are we planning to do this CapEx?
At this moment, the plan that it has to be funded through the internal accruals.
Sorry. Pardon me, I did not hear you.
At this moment, we have planned in our cash flow planning that it will be funded through the internal accruals.
Sir, on that internal accruals part, our creditor days for the FY 2026 have rose from 90-100 days to 135 days. How is our creditor days generally for a year? It stays at 135 days or is it between 90 - 100 days?
It depends, customer to customer because some customers we have negotiated, we have given them a very good platform for the vendor financing and on that basis a good negotiation for the days as upon the credit period. They're also enjoying that the costs what they are paying.
On average basis, how would it last?
It depends on the commodity to commodity, but 90+ almost all customers are, all vendors are there.
Got it. Got it. Thank you. Thank you so much, sir. Thank you for it.
Thank you. As that was the last question for today, I now hand the conference over to the management for closing comments. Thank you and over to you, sir.
Okay. Okay. Thank you, everyone. Before we conclude, I would like to sincerely thank all the investors, analysts and stakeholders for your continued trust, engagement and support. As discussed during the call, while the external environment remains dynamic, we believe Alicon is well-positioned for the future. Healthy momentum in the domestic business, encouraging customer engagement across markets, and our continued investments in technologies, capabilities and operational excellence provide us confidence in the company's long-term growth prospects. We remain focused on disciplined execution, strengthening customer relationships, and building a more agile and future-ready organization while maintaining a prudent approach towards growth and capital allocation. Thank you once again for joining us today. We look forward to interacting with all of you in the next quarter. Thank you.
Thank you, members of the management. On behalf of Alicon Castalloy Limited, that concludes this conference. We thank you for joining us, and you may now disconnect your lines. Thank you.
Thank you.