Ladies and gentlemen, good day, and welcome to the Harsha Engineers International Limited conference call. I now hand the conference over to Mr. Vishal Rangwala, CEO of the company. Thank you, and over to you, Mr. Vishal Rangwala.
Thank you. Hello. Good afternoon. Welcome, all of you to our Quarter Four FY 2026 post result update call. As per the normal practice, I'll ask our CFO, Mr. Maulik, who will take us through a detailed key numbers for the results. However, I'm assuming most of you would have had a chance to go through this. You know, at the outset, before I talk about, you know, the results and everything, I just want to kind of quickly summarize, you know, talk about what we are as a company and, you know, what we do.
We are, you know, primarily an engineering company with a big focus on a segment called bearing cages, where we are a very unique player within the market, with having a, you know, competency in steel, brass and polyimide products within bearing cages and a very unique position globally, having all these competency and precision level, catering to, you know, very good quality bearing companies and their needs for bearing cages. And that's our primary business. Beyond that, you know, we have worked over multiple years with big global bearing companies to outsource and supply them this product globally. We have earned a very strong market position within India and across the globe as well.
You know, that being the, you know, primary product. Beyond that, we also operate, you know, in the sub-segment of, you know, stamping components using our core competency. we also have a bushing as another product portfolio, where we are, both those segments we are growing very well and plan to grow further. we cater to variety of industry through that, those segments, including renewable as well as automotive, consumer goods and other industries. we are trying to grow, you know, business. We actually operate three facilities in India. Third one we've just commissioned this year, in Bhayla and two more facility, one in Romania, one in China.
Through these five facilities, we supply our customer base across the globe. We are now currently working on growing business in various segment, specifically for us, growing with Japan-based customer, growing the large size cage business, growing the bushing business, as well as growing the stamping business are some of our big growth drivers as we look at our future. This is just to, you know, get you up to date on, you know, how the area we operate. With that a little bit of, you know, additional background this time around, let me jump to, you know, the results this quarter.
I'm happy to inform our stakeholders that in spite of a current global turmoil which we are witnessing and which could have upset the rhythm of, you know, doing business, particularly in quarter four of the current financial, we have done quite satisfactory and have met most of our internal performance expectation on the key fronts. I'm happy to note that our India engineering business, including all the key verticals, have done very well in quarter four and financial year 2026. Specifically, bushings have also reported a revenue of about INR 127 crore for the financial year 2026, in line with our expectation, posting about 25% growth over last financial year. In the current year also, we are having a very aggressive growth plan in tune of 25%-30% in this segment.
Our sale of large size cages grew by almost 14% in FY 2026 and stood at around INR 49 crore. Sale to Japan-based customer grew by almost approximately 12% in 2026 and stood at around about INR 73 crore. In as much as the large size cage segment is concerned, we are working very aggressively for increasing our wallet share. Lastly, if we talk about Japan-based customers, the progress, those flow is positive direction, and we are committed to growing this segment as well. India engineering business, which includes Harsha Advantek, which is a subsidiary, has posted a good overall growth of around 14% in FY 2026.
Notwithstanding the fact that Advantek, you know, new unit and it's still operating at a lower capacity utilization. In FY 2026, export from India have also posted a good robust growth, almost 17% compared to FY 2025. Our export to U.S. have also started picking up, duly encouraged by fact that recently additional import tariff on cages has been reduced to in U.S. I'm happy to note that capacity utilization in Advantek is improving, and we should see the sales from this unit growing at least 3x in FY 2027. While in this current finance, financial Advantek through having posted a positive EBITDA of INR 4 crore has still reported a combined loss of INR 11.4 crore due to higher depreciation and interest.
The bottom line is also expected to improve considerably in the coming financial year. In spite of this drag in the current year, our India engineering business has posted an operating EBITDA of around 22% in FY 2026, which is quite satisfactory. Let me talk of our foreign subsidiary. As hinted earlier, China had performed well with an overall top line growth of about 9.26% in FY 2026 over FY 2025 and has also posted a positive EBITDA of around 11%. As announced earlier, we have already commenced implementation of China brownfield expansion project of steel cages. We believe that this will significantly strengthen the business presence in China, and we should expand our product portfolio from a predominantly brass-based cages to a good mix of steel and brass cages.
This project should come in operation in H2 FY 2028, and we should also see some improvement in EBITDA in China going forward. Romania continues to perform below par as it is still having negative EBITDA resulting into a combined foreign subsidiary losses of about INR 11 crore in the current financial year or FY 2026. We are trying our best to improve our product mix by focusing more on cages in Romania from current level of around 22% to more than 30%-35%. We are also pushing our key customers in Romania to increase their offtake from Romania. We have also started firming up our CapEx plan for the second phase in Harsha Advantek, Harsha Engineers Advantek, where our focus will be to create additional capacity for our key growth driver verticals.
We will be sharing more details as and when the plans are finalized in next few weeks. Now talking about our solar business. You might have seen that it has performed very well achieving strong top line and bottom line growth in financial year 2026, mainly on account of continued tailwind due to mix of increasing awareness and a good policy support from the government as well as private sector. Excuse me. Lastly, I feel confident that the current financial year FY 2026-2027, we should achieve an overall double-digit growth in top line, though the growth in India engineering would be a little bit more aggressive somewhat in mid-teens. We are also feeling confident that we should be able to at least maintain our current margin profile through our endeavor, though our endeavor is to improve it going forward.
I would like to thank you for the continued confidence in Harsha, and I would like to ask Maulik to walk us through more detail with numbers. Over to you, Maulik.
Thank you, Vishal . Hello everyone and good afternoon. I believe you have already seen the numbers and the presentation we uploaded for the investor call. For the quarter ended March 26, our engineering segment at consolidated level have achieved top line of INR 382 crore and EBITDA of INR 77 crore in the last quarter. Against our adjusted EBITDA of INR 64.3 crore in previous quarter and adjusted EBITDA of INR 66 crore in the last year, quarter four. For the year ended March 26, the engineering segment has achieved top line of INR 1,444 crore at consolidated level against the INR 1,269 crore last year. We have reported our consolidated EBITDA for engineering business at INR 264 crore. Our adjusted EBITDA is around INR 270 crore if we adjust it for New Labour Codes impact.
While last year adjusted EBITDA was INR 227 crore for our engineering segment. For the quarter and year end, we observe margin has improved, as defined by Vishal, right, mainly on account of the higher export sales and strong India demand, followed by the better product mix and cost control. We also have a positive impact on financial earning as well as [PR]. Solar business have achieved revenue of INR 183 crore for the full year, with a PAT of INR 10.2 crore for the financial year 2025-2026, against the adjusted PAT of INR 5 crore last year. Our overall working capital cycle at consolidated level remain around 130 days at the year end, against the 134 days in the previous quarter and 127 days in the previous year.
We have incurred CapEx of INR 120 crore in the full year and around INR 20 crore in the last quarter at a consolidated level. Our bushing business has achieved INR 127 crore, as Vishal here mentioned. Just one correction, our combined loss of subsidiary company in the current year is INR 9 crore, not an INR 11 crore, which has been said. Previous year it was INR 14 crore.
11 is on the Advantek part.
Yeah. With this brief on the financial numbers, I request operator to take the Q&A from the participants. Thank you.
Thank you very much. We will now begin with the question- and- answer session. Our first question comes from the line of Vaibhav Shah from Equirus Securities. Please go ahead.
Yeah. Hi. Congratulations on the good set of numbers. My first question is on your 27%. My first question is on the 27% revenue growth reported during the quarter. Could you provide some color on the contribution from pricing versus the volume growth? Were we able to fully pass through the commodity inflation of the previous quarters?
27%. quarter-over-quarter.
Yeah.
Q4.
Thanks, Vaibhav, for your question. First of all, 27% growth which you have observed is a consolidated growth, and the major contributor is our solar business over there, which has grown almost 100%+. INR 91 crore is the last quarter number. Our engineering business growth is 15.7% quarter-over-quarter, similar year-over-year numbers. Just to break down this number for your benefit, 27% is including solar, and if I remove the solar business, it is 15.7%. On your questions for the pass-through mechanism, yes, it is very well established pass-through mechanism with the customer. As per our agreed lag period, it automatically pass through to the customers. Different customer has a different lag period. Effectively, you can say that on an average, on four months, everything gets passed through.
Just one clarification, Vaibhav. Our engineering consolidated India business, including Advantek, is about 16.6% quarter-over-quarter. INR 28 crore is the Q4 contribution of sales coming from Advantek.
Yeah. Right. Yes. For Q1 as well.
Was it entirely driven by the volume growth or was there some pricing benefit as well?
Majority is driven by volume growth, considering that, the last quarter, which is September to December, if you observe, there has not been a significant material movement. The movement started at the end of December and ran up to around February or March for the metal prices, including brass.
My second question is on the India engineering business. While we saw the strong performance in FY 2026, and primarily driven by the exports, while the domestic revenues witnessed relatively modest growth. Could you help us understand the key drivers behind the strong export growth as well as the reasons for the softer domestic performance? It would be great if you could elaborate in terms of the end user industries and the customer segments.
Yeah. So yeah. From our point of view, the growth in export is driven by, you know, improving markets, industrial global markets, improving European markets as well as U.S. market because of the, you know, specifically the tariff impact. That those were the factors.
Supported the global market growth and things like that. Other factor on the domestic market, I think, that has also grown very well according to us. Maybe one of the factor which is masking that is potentially the by-product sales which might be masking that partially basis of the numbers. Overall, we are confident including India growth has been very robust in FY 2026.
Just to add, India cage business has grown by more than 10% on a pure India-to-India cage. Okay. That's almost 11%. Then there is further growth in India level supported by our bushing business and our stampings business. It's not like bushings or stampings have grown. It is cage also have grown in good volume.
Understood. sir, lastly, could you share your CapEx plan for the FY 2027 and FY 2028?
We are in process of, you know, fully finalizing all the details of our CapEx plan. Right now we are already what we have finalized, what we are already looking at is about INR 30 crore-INR 40 crore of maintenance CapEx in India in this current financial year. My assumption, a very similar number would be there next year. Also, you are aware that we are, you know, we have started the China expansion project and declared an investment there. Reference to that, about INR 70 crore CapEx is expected to be executed in current financial year, and a further INR 20 crore we are expecting next financial year.
These are some of the things which are already clearly firmed and finalized, and there are other things which we are still working on. We are expecting that based on the various, you know, planning and activity, we will potentially add to this, but it is still under process.
It's predominantly, as he said in his speech, the second phase of Advantek, we are starting to work on the desk and probably in the next few weeks the plan will be frozen. The work will start this year itself.
Understood, sir. Understood. Thank you very much for answering my question. I will get back in the queue.
Thank you. Your next question comes from the line of Jason Soans with IDBI Capital. Please go ahead.
Yes, sir. Thank you so much for taking my question. My first question just pertains to the Romania and the China subsidiaries. I just wanted to know the absolute revenue numbers for whole of FY 2026 for Romania and China both. If you could also possibly give the PBT numbers as well.
Okay. Sure. We already said that combined loss is INR 9 crore for China and Romania, but I'm happy to share the independent number also.
Yes.
Which we will definitely publish also, once the annual report is uploaded. Our Harsha China has done turnover of around INR 120 crore with a profit of around INR 5 crore as a profit after tax. Harsha Romania has done a turnover of around INR 247 crore with a profit after tax around INR 14 crore loss.
Loss.
Loss.
INR 14. Correct.
Okay. Sure. The revenue is INR 247 crores and loss is INR 14 crores for Romania. China revenue is INR 120 crore and PAT is INR 5 crore. Correct, sir?
Correct. Yeah. Correct.
Correct. Okay. Thank you so much for that. Okay. My next question just pertains to in terms of the demand situation. You know, if you go back two, three quarters, the situation in Europe was pretty weak. Just wanted to know, and Europe being a key market for us, just wanted to know how is the demand situation right now in Europe, specifically, you know, pertaining to the Europe subsidiary.
Last whole year we are seeing the, you know, demand has slowly improved over the year. Specifically for the European subsidiary also the demand is continuing to improve. Right now the indication are that it is all positive growing we need to how we turn around the situation from a cost as well as pricing and, you know, all those profitability point of view is our main concern. Overall, we see very positive indication from our customer for our subsidiary in Romania.
Sure, sure. Things definitely have improved from what it was. That's, that's heartening to know. Sir, actually, I just missed out on one question. I mean, regarding the Romania and China subsidiary. Of course, now Advantek also is in the mix, I understand that. Combined, when you look at the loss, on a combined level of subsidiary, it's around INR 21.6 crores to be precise. Of course, it will be a combination of Advantek as well as the China and the Romania entities. Just wanted to know, sir, when you look going ahead, 2027, 2028, are we definitely on a trajectory to basically reduce these losses going ahead? We have done lot of work on the Romanian subsidiary as well, you know, in terms of restructuring and China is doing well.
Advantek also will ramp up. Understanding is probably there should be a quick ramp up or, I mean, a decent ramp up of all these things and probably losses will get to reduce considerably going ahead, 2027, 2028.
Yeah, Jason, I think it's covered by Vishal in his introductory speech also.
Mm-hmm. Yeah.
That this year Advantek has a loss of around INR 11. 5 crore or more.
Mm-hmm. Yeah.
Because of the first year of operations and mainly despite of positive EBITDA, there is a loss on account of higher depreciation.
Interest on the loan we have taken over there. Gradually this will reduce because utilization will increase in this year. We expect it to be more positive trend this year at Advantek level. While China is already in a positive territory and will increase. Over there. In Romania, our discussion is already on with customer, and we are hopeful this year to reduce this loss further compared to what we already reduced this year compared to last year, and further we will reduce in the coming period.
Exact quantification may be difficult, but definitely there will be reduction.
It will be reduction.
For sure. Significant reduction.
For sure. That's Okay. That's very heartening to know, sir. That's good. Sir, again, I spoke to you about the, this, the situation. Now I just want to know the situation domestically, you know, the likes of our big three in terms of the bearing manufacturers, localization, CapEx. How do you see demand for that on the ground?
We see very positive picture. There our customers have, you know, significantly ramped up their demand and capacity in India. Responding to probably all the, you know, signals from automotive as well as industrial market. Further we feel that there will be another round of investment to cater to the, you know, existing or upcoming demand from our customer are the indications we see. We are very bullish. There could be impact of, you know, current war and, you know, petroleum prices and all that could have some impact from a short-term point of view. We don't know that yet. Overall we are very bullish and working towards growth. We are, you know, we are banking on that to continue our growth journey in our domestic market.
Okay. Things seem to improve. In the midterm it was looking a little slow, you know, with all the restructuring, particularly one customer, one entity and all those. Now it's picked up, the demand and all. You are seeing good demand trends going ahead.
Right now we see good traction.
Yeah. Yeah. Just finally, I'll just join back the queue. Sir, just wanted to know in terms of, as per geography, how do we Now, of course, in the presentation you can see that on a console level 58% of revenue is outside India. 42% is basically, I'm just talking about 2026, for the year 2026. 42% stays within India. How is the other breakups, sir? Just wanted a breakup of the geographies. What, what contributes to the total revenue?
We already spoken in past on this, Jason. Our majority geography outside India is Europe, followed by China, America, Japan and others. Europe usually contribute on a larger scale, because there is a casting sale also from Romania, in Europe, and that also part of our overall top line. Usually Europe in this bifurcation is, in total sales is around 19%, in the total sales. China and America will be around 10%+ , and others will be there. Sorry, my bad. My bad. Europe is around 30%. My bad. I'm just correcting myself.
Okay.
Europe is around 30% in the total sales. China and America, China is more than 10%, America is around 6%, and followed by Japan and others.
Okay. Sorry. China and U.S. are 10% each, and Europe is 30% you said?
Yeah. China is little higher than 10%, and U.S. is around 6%, 7%.
Okay. Japan is?
Japan is still not significant, around 2% +.
2%. Okay. Sure. Thanks for that. Thank you. Thank you so much. I'll join back the queue.
Okay.
Thank you. The next question comes from the line of Jaimin from Adecco Asset Management. Please go ahead.
Thanks for taking my question. The first question is on, can you break down the full year export growth into the three buckets, one from the recovery in the end market, be it Europe or the U.S., wallet share gains, within existing customers or the geography, and any new commerce realization.
Jaimin, your voice is breaking.
Hello, can you hear me? Hello?
Sir, it's sounding a bit muffled right now.
Can you hear me now? Hello?
It is slightly better, sir. If you're using any other mode, may I request you use the handset mode, please?
Sure. Now it is better?
Sure. Just give me one moment, sir.
Yeah. Hello. Can you hear me?
Yes, Jaimin, sir, please go ahead.
Yeah, hi. Hi, Maulik, sir. Can you just break down full year export growth into three buckets? One is, I mean, the recovery in the end market, that is, Europe or the U.S. Two is the wallet share gain within existing customer or the geography. Any new commercialization in new programs or the geography.
No, Jaimin, we do not share this data to the investors. Basically, we've already given a good amount of breakdown of our export sales in the previous question itself.
Just wanted to understand, I mean, the growth we have seen for full year basis, is it more led to the recovery or, I mean, have you got, I mean, breakthrough into new geographies, new program within existing customers?
It's a mix of both. All three items are there, you are right, but we cannot give further breakdown to it.
Okay. When we are seeing, I mean, mid-teen kind of growth for the coming year, I mean, in engineering business for the FY 2027, how could we I mean, how could we think about the contribution from export Advantek ramp up or to domestic demand?
I think, Vishal has already covered in his speech. We expect India to continue to grow, in a higher teen, or mid-teen to higher teen, and that will be contributed by both India growth as well as our export growth will continue. That's the expectation.
Okay. Okay. I mean, one thing I'm interested in is your customers' performance. Right now they are using the pricing action to offset the inflation pressure, I mean, in their respective geographies. Have you seen any change in the sourcing area or the localization behavior that is going to benefit you from the near to medium term?
Jaimin, I think what you're trying to say is that our customers are looking at us only to offset their pricing. Actually, that's not correct, because through our competencies, we have now become an indispensable partner with them because we play a very important role in helping them grow their product portfolio by making sure that cages are always available. As you know, cage is about 5% of the total bearing cost in terms of value. The problem here is that the customers, the big players have stopped investing in new facilities or up-gradation of their facilities over a period of last many years. We have a massive advantage of volume accumulation, so we have done absolutely up-to-date up-gradation of technology, skill sets, manufacturing capacities, everything.
It is not only the cost part, but it is the speed, the development at which if they want to develop a tool, they might take much longer time, we do very quickly. The cost at which we are able to develop that new tool, I think all these factors become very critical. You know, this is one product where a customer does not do any further processing.
Right.
If you look at inner ring, outer ring, anything, they do grinding, but a cage, they directly put it in the bearing, and it's a very important component. I think cost is a very I would say today cost is important but not the barometer for them to consider.
No, no, I understand. My question was different. My question was, I mean, part of the customer, they are facing inflation in the cost front, and right now they are offsetting cost inflation to the pricing piece. They are not, I mean, doing lot of, I mean, vendor consolidation or any change in the sourcing piece. Anything you are seeing from your side that will benefit you in terms of your vendor consolidation or increase in outsourcing?
That's an ongoing project, sir Jaimin.
Okay.
As we already informed you, outsourcing is the areas which is more beneficial to them whenever there is a global scenario or global challenges. It's an ongoing thing. There is nothing specific which we have to announce today.
Okay.
New product development and outsourcing activities are ongoing activities, and pricing pressures are in our favor.
Okay, sir.
Yeah.
Thank you so much, sir. That's it from my side.
Thank you, Jaimin.
Thank you. The next question comes from the line of Jay Shah from Genuity Capital. Please go ahead.
Hi. Congratulations for a good set of numbers. I had two questions, Sir. One was on the Advantek subsidiary. What in your estimate would be the timeline to ramp it up to, you know, the maximum capacity? What is the ballpark figure in terms of top line that Advantek can contribute? Second question is, Sir, this is a bit longer term, over the next two, three years, I mean, keeping aside the current volatility. Since you know we are into precision components also, and apart from that bearing cages, the CapEx cycle that, you know, we are seeing locally and even globally, what do you feel is going to drive Harsha's growth as a company, you know, for over a two, three-year period? What components or rather what end sectors do you think are going to help Harsha, you know, achieve the long-term goals?
Okay, let me take your first question, Jay. About the Advantek optimum capacities. Advantek is still in a growing and fixed asset spending stage. What I can say you is, based on the current installation capacity, we expect it to reach to the peak in next two years, the current install capacity, we also expect it to get into the next phase of expansion also meanwhile. It is difficult to give you precise answers, with the current install capacity, we expect it can give us around INR 250 crore-INR 300 crore turnover.
As I just said, this will further enhance as we further go for expansion in our Advantek subsidiary. On your second question about growth and area where We can grow better, I ask Vishal to give you more insight.
Yeah.
Sure.
For us, you know, cage is important growth driver. Within that, we have identified that, you know, increasing the outsourcing or wallet share through resourcing to outsourcing is a very big growth driver for Harsha. Within that, you know, large size cages is there. We see that lot of manufacturing is moving to India, which should also additionally benefit Harsha, bearing manufacturing moving to India. You know, we are also bullish on, you know, bearing industry growth. Within that, you know, additional growth coming to Harsha based on the outsourcing as well as resourcing, as well as, you know, India, more India manufacturing and us having a big share of market in India and so on.
Cage is a big growth driver for us, including, you know, even we consider Japan-based customer growing wallet share with them. Beyond the bearing cages, we expect at least stamping component and bushing business to also grow much faster. We are expecting from a midterm basis, at least 15%-20% growth in these two segments. We are expecting because, you know, we are investing in new capacity, additional product portfolio, even in these two product lines. Right now we expect that all three established, currently established product lines should give us, deliver a good growth numbers. Further we are looking at expanding this portfolio beyond. In a short to midterm, these are all good growth drivers for us.
Just to quickly add, to complete the story, as you would have seen in the presentation, we have given the data of SKUs that are being developed every year. About 500-600 new SKUs. One SKU is a one particular type of product which has strengthened my SKUs to beyond 8,000. These are the new products which are the pipeline for cage coming to us going forward, and that is an indicator that how the pipeline is quite robust. On the bushings also and stampings, we are developing new products, new variations, multiple variations. We are filling the pipeline there also. I think the serviceable market is much bigger, and we should continuously see at least at the India engineering level, a minimum 15% growth year-over-year in a normalized situation, we don't find any problem. The bearing industry per se globally doesn't grow more than maybe 7%-8%. This is where we are.
Understood. Understood. Thank you so much for the detailed answer. Just one more follow-up on the same, sir. Since you said that, you know, insourcing is a big strategy and a lot of manufacturing is moving to India, and since Harsha is already, you know, engaged with all the bushing, bearing majors of the world. Is there any discussions with all these bearing majors to, you know, given Harsha's capabilities that more and more parts apart from bushings and even bearing cages and other components, that they are looking at more parts to give to Harsha given your capabilities and your relationships?
We, you know, we are not really going beyond, you know, stamping components with our customers. At times we expand our portfolio with our customer, beyond bearing cages, and we have successfully done that. Primarily that would mean stamped product, beyond bearing cages and few other products. We do not really intend to majorly as we speak today, you know, we are not a strategy to go into any other specific bearing components beyond cages and, you know, related stamping and other components. This may change, right now that's our, you know, stated goal.
There's a reason I have a very big headroom for growth. If in India my wallet share is, say 70%, 80%, 90%, overseas within all these big customers, the wallet share varies from 10%-20% on the three established old relations and maybe 2%, 3% with Japan-based customers. Wallet share. [inaudible].
Understood, understood. Sir, what is the main reason [inaudible].
I think primarily the markets, last few years, we faced a big challenge of degrowth in our biggest market of Europe, and a little bit in China side specifically, and even a little bit U.S. last year. Now having said that, you know, they have started coming back. Partially our growth is driven by that. Also our growth currently is driven by all the new additional wallet share we won during that time, but realization got delayed and now is, they are into execution. We don't see as that as a challenge, but, as a wallet share degrowth, but more of, we couldn't move the wallet share and the market, softened over, you know, our biggest market softened over last couple of years.
Sir, would it be fair to assume, in Europe, like it has happened in chemicals, and even in some cases, casting, forging, a lot of big players have gone out of business. Has our sector also seen some consolidation, and that's why we are now more confident to get incremental wallet share?
Yes, you're right. See, I can't share any specific names, but yes, there is some consolidation.
Sure.
That is also driving, our endeavor to, you know, increase our wallet share. You're right.
Understood. Understood. Just as a last question, if you could throw some light on sectors that are really doing well in India and Europe, any sectors as you would be speaking to your customers and their customers over, medium to long term.
You know, we are seeing, as I said, overall also, across, I mean, without going into subsector, industrial has been doing very well last six months, plus. Current indication is that that should continue. We are seeing good growth on the automotive side, specifically India and some potential, you know, green shoots on the automotive across the globe, but I'm not very clear about that one. In general, as yet, wind has not picked up in Europe, which we are, you know, one of the factor of, you know, the plant and Romania facility was quite focused on wind as a primary market. That is not yet a great news.
Beyond that, we are seeing industrial sector across the board growing and supporting. Even, we are seeing positive signs of railway in India and across the globe, some fact, orders coming in specific to that and so on. Again, we would not have a very sharp insight into a subsector, because at the end of the day, we supply to, you know, customer who assembles it and gives it to a sector or industrial or automotive. That's a little bit of limitation from our side, be able to clearly tell you that.
Understood. Sir, thank you so much for answering all the questions in detail. All the best for the future.
Thanks, Jay .
Thanks.
Thank you. The next question comes from the line of Saket Kapoor from Kapoor and Company. Please go ahead.
Yeah. Namaskar, sir. Hope I'm audible.
Yeah.
Sir, if we look at our last two financial years, we have done CapEx to the tune of closer to, say, INR 210 crore for FY 2025 and INR 120 crore for FY 2026. Now, the property, plant and equipment closing balance is at INR 615 crore. At peak utilization levels, sir, I mean, how, what should be the likelihood number? I think so now with the inflationary trend, what should be the revenue trajectory that we are anticipating? How should we look at this number of INR 300 crore translating into the business opportunities going ahead?
Before Maulik bhai gives you specific answer, one thing, the new CapEx of Advantek also includes the fundamental infrastructure development, which will not immediately translate into a fixed asset multiple.
Revenue, yeah.
The revenue multiple. Yes, Maulik.
Well, that's right. That's why, Mr. Saket, if you see our overall plant and machinery is obviously the net block you have seen. Considering the capability and followed by our maintenance CapEx, we expect the current preset of business can easily reach us at India level around INR 2,400-INR 2,500. Console level can be around INR 2,700 crore-INR 3,000 crore, depend on what kind of capacity we look into. Because at console we also have a casting capacity, which is a independent capacity from the cage. This is input to your questions, Mr. Saket.
Sir, last year we did around I think so more than INR 100 crore for the bushing segment. What have we outlined for the current year? How are the order books for the bushing segment in particular?
Yeah, Vishal has already covered in his introduction. The expectation this year bushing is also to continue similar growth, trajectory of around 25%-30%.
We did INR 127 crores in FY 2026, huh?
Yeah.
In bushings.
Right, sir. In the caging part also, sir, I think for the large cages, we were finding it more headwinds going ahead. Correct me there. In terms of the product profile, which segment are you seeing the better opportunities and how should the category perform?
Large size cages have done about INR 50 crores, 14% growth this year. We expect at least this segment to keep on growing in mid-teens without any problem, 15%-20%. No issue. Lot of things are in pipeline.
Okay. Sir, as you alluded to the earlier reply that we are anticipating mid-teen growth for the current financial year, what should be the EBITDA margin trajectory?
EBITDA.
Sir.
We will continue to share, Saket, the blended EBITDA only. We expect our EBITDA, as you must have seen in last few quarters, it has improved. We expect it to continue to improve marginally. Over the period of two to three years, our expectation is overall increase of 100- 200 basis point in our EBITDA.
At a console level.
Overall.
At a console level.
India has been consistently doing about 20%, as you know.
We've already given this.
Yeah.
Inputs before. Okay, sir.
Sir, all the best to the team, sir. This time also we are coming up with our AGM also earlier, so lot of insights and annual report would be at our disposal much early than what it used to be. Thank you for the team for looking into the request.
Appreciate. Appreciate your input.
Thank you.
Thank you, Saket.
All the best. Thank you. Namaskar.
Thank you. Your next follow-up question comes from the line of Jason Soans with IDBI Capital. Please go ahead.
Sir, thanks for taking my question again. Sir, just wanted to know the absolute value of the stampings revenue for FY 2026.
Stamping absolute value, INR 60 crores. INR 60, yeah. INR 60 crores, yeah.
INR 60 crores. This is also expected to grow by 20% till next year?
Yeah, yeah. It will grow better. Yeah, yeah.
Okay. Okay. Sure. Also just a follow-up question. Just wanted to know, I mean, again, when I go to the past, you know, I spoke about this, the Europe demand was weak. Now we are seeing situation improving on the ground. Just wanted to know, sir, what is your thought on the Because it's a very important market for us. What is your thought on the sustainability of this demand? Has something changed on the ground that, you know, demand trends are coming back? Just wanted some color. You've done a lot of restructuring, et cetera, as well. Is that working out well, or has the macro situation improved? Just give us some color on the demand situation in Europe and how sustainable this can be.
As I said earlier, Europe is slowly improving. There is no, like, a definite, you know, like a big stroke of improvement. We are seeing a slow, sustained improvement happening in Europe from a demand point of view. On the, you know, some improvement and structuring, we still see that there is an ongoing work. We don't have, you know, completely We are not done yet, and there is lot of still pending work within that in terms of creating a right cost structure. In Europe, we are continuing to face massive inflationary pressure in Europe, which is also adding to this whole challenge. From a overall outlook, we are bullish on the demand side of it.
We are, we are seeing, I think someone was mentioning about, you know, there are because of the downturn and the inflationary challenges, lot of companies have, you know, has a impact and, you know, we are hopefully so far surviving. We are also evaluating can, how long we can do with this kind of negative margins. How we can quickly improve on the operational side further and, also we are looking to improve on the top line faster. That's the intent. Having said that, I don't have a very clear direction or, like a input from our customer on that, demand improving to the level needed immediately. We are continuing to work on the cost side of it. Again, a very hazy picture, but that's what we are working with right now, but very hopeful and positive.
Okay. Sure. Sir, just wanted to know in terms of bushings, you have seen very good growth and expectations of also for good growth ahead as well. What is driving this growth in the bushing space? 25%-30% is very healthy. Just wanted to know what is driving this growth, sir, on this front.
This is primarily there is a conversion for design. In the wind market, wind gearbox, there is a conversion happening if you look at a planetary gearbox, the planets which were earlier using bearings are now using bushings, and that is driving this drastic growth. The underlying market is roughly the same or maybe growing the wind market specifically in India. But it's growth is driven by more and more design coming under the bushing concept for vis-a-vis the earlier design of bearing concept.
Okay. Sure. That's more driven through a design change, which is good. Okay. Okay. Sure.
Yeah. Substitute market.
Yeah. Okay. Sure. Sir, just in terms of stampings, I would just assume that in terms of end user markets, it'll be again varied between automotive and industrial. Is my understanding correct?
Correct. It's.
Yes.
A whole lot of automotive, industrial, railway. As well as, we work with one big chunk is going into consumer goods.
White goods.
White goods. So, we are making uhm, big growth driver for us. One of the big growth driver for us is air conditioning compressor components as well as white goods like home appliance, some of the stamping components for that. That is, you know, driving that growth.
No, white goods is Okay. It goes into white goods as well, which is pretty good. With AC market also going to expand. That's good, sir. Just finally, sir, wanted to know, I mean, in terms of the Middle East crisis, we have seen this, of course. Just wanted to know any issues during the quarter in terms of any logistical issues, shipping or any raw material price increases. Going ahead, do you envisage anything impacting us adversely?
I think there is definitely impact on the cost side of it. Which we are trying to mitigate. I don't have a clear answer on that, to what extent, and where, but We are seeing the impact across the board, on the input side of the, you know, specifically when we use, some of the oils, lubrication things in the, in our production, that all cost has a cost impact. Our plastic cage material obviously has gone up. That is also an issue which we are dealing with or addressing it, countering it, or passing on, working on passing on. On the logistics front, so far we have not seen any impact, specifically because if you remember this, whole Suez Canal crisis happened.
About two, three quarters back. Anyway, shipping had taken the hit and impact a few quarters back. That, that route, shipping route has remained clear of, current, immediate crisis, for us at least.
Okay. Okay. Considering that also, sir, I mean, you see margins you can basically improve from here on. I understand there is, this is, could be a near-term pressure, but even considering this, you can expect going ahead, we can basically improve margins or at least maintain margins.
Our intention is that there is definitely pressure on other levels.
Yeah. On the input material for sure.
Sure. Thank you so much once again, sir. Thank you so much.
Thanks, Jason.
Thank you. The next question comes from the line of Hiten Boricha from Sequent Investments. Please go ahead.
Yeah. Thank you for the opportunity. Mostly my questions have been answered. You mentioned growth will be around in mid-terms for India as well as for overseas business. I just wanted to know the number on it. You have made a very good growth on the solar segment from INR 140, INR 140 odd crores to around INR 185 crores. Can you share the number on that?
My growth. We expect solar also to continue grow well. I think you are asking for the solar growth estimates, right?
Ha, sir. I think it's grown around INR 30-INR 35 odd crores, right?
Yeah. In fact, solar is also in the tailwind sides and solar will continue to grow because the government policies are much favorable, especially in Gujarat territory, and we expect it to grow more than 25% also going forward.
Okay. With that growth, our EBITDA margins should improve from current levels, right, sir? It has seen a very good operating leverage from 4.5% to 8%-odd level in FY 2023. It should improve there as well, right?
We expect solar to maintain the last year reported EBITDA margin, maybe marginal improvement over that.
Understood. Understood, sir. Yeah. Yeah. Thank you.
Thank you.
Thank you. Ladies and gentlemen, as there are no further questions from the participants, I now hand the conference over to Mr. Vishal Rangwala for closing comments.
Great. Thank you very much everyone for attending this conference. Appreciate your time, so late in the day. Thank you, and have a good evening.
Thank you. Thank you.
Thank you. On behalf of Harsha Engineers International Limited, that concludes this conference. Thank you everyone for joining us. You may now disconnect your lines.