Ladies and gentlemen, we welcome you all to the Q4 and FY 2026 earnings conference call of Jyoti CNC Automation Limited, hosted by AXIS Capital. As a reminder, all participant lines will be in listen only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing star then zero on your touch-tone phone. Please note this conference is being recorded. This conference call may contain forward-looking statements about the company, which are based on the beliefs, opinions, and expectation of the company as on date of this call. These statements do not guarantee the future performance of the company and may involve risks and uncertainties that are difficult to predict. I hand the conference over to Mr. Nikhil Kandoi from AXIS Capital. Thank you, over to you, sir.
Thank you, Steve. Good evening, everyone. On behalf of AXIS Capital, I, Nikhil Kandoi, welcome you all to Q4 and FY 2026 earnings conference call of Jyoti CNC Automation Limited. We are pleased to have with us management represented by Shri Parakramsinh Jadeja, Chairman and Managing Director of the company. We'll have the opening remarks from Jadeja, sir, followed by Q&A session. Thank you, and over to you, sir.
Thank you, Nikhil. Good evening, everyone, and a very welcome to our Q4 and FY 2026 earnings conference call. Along with me, I have a senior management team and SGA, our Investor Relations Advisor. Financial results and presentation have been uploaded on the stock exchange, and I hope everyone has had a chance to go through the same. I will begin my opening remarks with an overview of the economic environment, followed by updates on the company's operational and financial performance. The global economy continues to remain uncertain due to tariff-related issues and the ongoing conflict in West Asia. These developments have resulted in higher energy prices globally, supply chain disruptions, and challenges in the availability of the raw materials for manufacturers across industries.
In today's interconnected world, no country can remain completely insulated from such disruption, and India may also witness some impact if the West Asia conflict continues for a prolonged period. However, India's long-term growth outlook remains strong, supported by the government focus on Atmanirbhar Bharat, improving India's standing as a manufacturing hub, and continued investments in infrastructure, which is supporting expansion of domestic manufacturing capacities. On the global front as well, a better clarity around tariff, along with free trade agreements with key economies such as the EU and the U.S., is expected to support export-oriented industries. Improved visibility on global trade should strengthen a demand across the international markets and create additional growth opportunities for companies like ours. Speaking about Jyoti CNC, first let me highlight it, the performance and progress on a standalone basis. FY 2026 was another year of a sustained momentum for the company.
We currently have an installed annual capacity of 6,000 machine in India and grown together during the year. One of the key challenges we encountered was capacity constraint, with our facilities operating at utilization level exceeding 100% during peak demand months. These impacted our ability to fully execute orders despite a strong and expanding order book, supported by the robust demand across all major sectors we serve, including aerospace and defence, auto and auto component, general engineering, and EMS. The outlook across both domestic and global markets remain positive across all manufacturing sectors, especially we have seen a good pickup in auto and general engineering sectors. All sector are expected to play a key role in our next phase of a growth, we are witnessing a customer's inquiries and converting into the orders at the fastest pace.
To support this growth, our plan to expand our annual capacity to 16,000 machines remain on track for a commencement of commercial operation in quarter two of this financial year. This capacity addition will be a major driver for the company's next phase of the growth. Given strong demand and environment, we remain confident of ramping up utilization at a healthy pace. While we are witnessing strong customer inquiries in view of our order backlog. We have been conservative in the order booking to match our delivery obligations. If you look at the standalone India business, which reflects the underlying growth momentum, the performance remained very strong during the year. Our standalone quarter four revenue witnessed growth of 13% to INR 599 crore, while FY 2026 standalone revenue grew by 20% to INR 1,949 crore.
On the profitability front as well, quarter four EBITDA stood at INR 191 crore with margin of 31.9%, while FY 2026 EBITDA stood at INR 564 crore with margin of 28.9%. Quarter four PAT stood at INR 135 crore with margin of 22.6%, while FY 2026 PAT stood at INR 391 crore with a margin of 20.1%. This strong standalone performance reflects the healthy across our focus sectors, improved operating leverage and strong execution capabilities across the businesses. Coming to our consolidated operations. The global demand environment for our product portfolio continued to remain strong, and we are witnessing increasing customer engagement. However, as previously disclosed to the stock exchange, an ongoing investigation is being conducted by the export control authorities concerning certain export order at Huron. The investigation has had no material adverse impact on the company's operations, including order execution, exports, customer servicing, or ongoing manufacturing activities.
We would like to reiterate that Jyoti Huron continue to enjoy a strong reputation across both domestic and international markets, and we remain confident in our ability to navigate the current situation effectively and emerge stronger going forward. Importantly, these investigations are not limited to Huron alone, but extended across multiple companies operating within the industry across Europe. Speaking about the financial implication during the current period, based on the assessment of our local auditors for Huron, and as a matter of prudence for Huron, our company has reversed a revenue amounting to INR 67 crore during the quarter, which had previously been recognized under the percentage of completion method called POCM. I would like to clarify that this does not represent a loss of revenue or cancellation of the orders, but merely a deferment of the revenue recognition to future periods. Consequently, this impacts our consolidated revenue from operations.
On a consolidated basis, revenue for Q4 FY 2026 stood at INR 599 crore, excluding the impact of the revenue reversal. Revenues would have grown up by 16% Q4 FY 2026 and by 19% in FY 2026 on a year-on-year basis. On the profitability front, the revenue reversal has also impacted profitability as the manufacturing cost related to these machines had already been incurred while the corresponding revenues could not be recognized during the current period. Lower revenues coupled with the associated cost and de-operating leverages adversely impacted profitability. As a result, a consolidated EBITDA for Q4 FY 2026 stood at INR 147 crore with a margin of 24.6%. FY 2026 EBITDA stood at INR 527 crore with a margin of 25.2%. PAT for the quarter stood at INR 91 crore, for FY 2026 PAT stood at INR 336 crore, an increase of 6% year-on-year basis there.
Had there been no impact of reversal, PAT growth would have been faster. Speaking of our order intake. Our order intake for Q4 FY 2026 stood at INR 700+ crore , driven by all sectors and particularly by auto and general engineering segments. For FY 2026, order intake stood at INR 236 crore. This includes 27% of aerospace, 28% of auto and auto component, and 31% from general engineering. As on 31st March 2026, our outstanding order book stand at INR 4,732 crore, which is very healthy and growing. On the operational KPIs, a segmental revenue for FY 2026 consists of 39% from aerospace and defence, 26% from auto and auto component, 23% from general engineering, and the remaining from other sectors, including EMS and dies and molds.
Speaking of our current order book, it remains healthy and well-diversified at INR 4,732 crore, reflecting a steady demand and continued customer confidence. The industry-wide breakup is as follows: 38% from aerospace and defence, 19% from general engineering, 20% from auto and auto component, 4% from EMS, and b alance is from the other sectors. As we enter FY 2027, we remain optimistic about the opportunities ahead for the company. The demand environment across our key sectors continues to remain stronger, supported by increasing manufacturing investments both in India and globally. With our ongoing expansion of 10,000 machines progressing on schedule and expected to commence operation by September, we are entering the next phase of growth with significantly enhanced capacity and stronger execution capabilities. We continue to see a healthy customer engagement, stronger order inflow, and improving our long-term opportunities across domestic as well as export markets.
We may now open the floor for question and answer.
Thank you very much, sir. We will now begin the question- and- answer session. Anyone who wishes to ask a question may press star and one on their touch-tone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handset while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question comes from the line of Nishant with Kotak. Please go ahead.
Good evening. Nishant here.
Hi, Nishant.
Hey. Hi, sir. I just wanted to understand, what are the timelines for the investigation to get over? By any chance, did we have an alternative opinion with respect to the auditors to not take a revenue write-off, but to take a provisioning? Which probably could have just impacted your bottom line, but your top line wouldn't have got impacted so much. That probably looks to be a better accounting rather than just taking a complete revenue write-off. With respect to the timelines, if you can just help us out when the investigation timeline will be completed, and when can we get back that revenue of INR 67 crore, which has been written off? That's my first question, sir.
First of all, Nishant, this is not any write-off. This is a deferment, and this deferment of a revenue of a POCM. POCM also, let's say, is a future sale, basically. It's a revenue recognition based on a percentage of order completion there. Okay. The auditor's view was that it is just a deferment. It's not any write-off of that. Let's say the situation is that in investigation, there are few machines was under POCM, and that was not available the exports license clearance. They stated that once this export license you will receive, you immediately can convert it into your revenue in the coming quarters over there. First of all, remove in this mind, this is no more a write-off there. Okay. It's just a deferment there. Okay. This is the clarity there.
Let's say the POCM cannot be a provisioning. It can't be a provisioning like that on a financial kind of a thing. The fact is a fact, it is just a deferment. There was nothing to be kept as like that. Okay. Regarding the investigation, we have retained the legal counsel and not in a position to indicate a specific timeframe for resolution of the matter. However, this investigation has no material adverse impact on the company's operations, including order execution, exports, customer servicing, or ongoing manufacturing activities. Everything else, it is working nicely there.
Okay.
There are more than 50 companies are under investigation in last three years, and we have not seen any conclusion from any companies today in Europe today.
Okay. Sir, second question, I just wanted to understand, the order book, if we can see, congratulations for the order intake. It looks to be a little more well-diversified and not skewed towards aerospace. In general, sir, while we execute the order book and the new capacity coming in, the order book still looks to be more towards high-end machines, where the working capital cycle could be a little more extended. How are we thinking of managing the cash flow in the coming year, FY 2027? What is the typical CFO to EBITDA ratio which one can probably look at in your business for the next one year as well as for FY 2028?
Thank you on your remarks on order book. It's a very healthy order book we are seeing. Even in the last quarter, we have received, even end of this month, we have received very good orders from European areas like in Ukraine and all, including French government, we received good orders there. Even India also, we have received good orders on aerospace and defence in our Indian contact also there. Apart from there is a very significant movement we have seen in the last quarter in the auto components and general engineering area. You know that we have a more than 15,000+ customer base now in India across manufacturing sectors there. We see very robust outcomes in the coming days over here.
In terms of reserve capacity is coming, is also is a mix of all, is not just only entry level, but with a mix of all. The way the new capacity is coming up, we are expecting our manufacturing cycle also to be improved. We see that based on that, our cycle will reduce. We are able to see the more working capital requirement is going to be reduced there, and we see the conversion of cash flow over there, basically. Even this year also, from the last year to this year, the last year we were into negative cash flow to we entered into positive. We are looking to be a very robust cash flows in quarter-on-quarter in coming days over here, there.
Sir, if I can squeeze in one last question. With the commodity inflation, which is prevailing at this point of time, what percentage of contracts are fixed in nature? What percentage of contracts are passed through in nature? What is the timeline by which we can pass on the cost to our customers? Thank you so much.
The cost, Nishant, we have always a fixed cost base there. We are not able to pass on the increase any cost to the customer there. We are naturally hedged over here, because we have a very long manufacturing cycle, and any new orders we are taking, we are able to increase the price. Let's say today, in the last two months, we have seen the cost has been increased close to 2%-3% over there on raw material prices. From 1st of this May, we have increased our prices to any new customers and new orders over there. We are able to compensate over here with the new cycle there.
Okay, sir. Thank you so much. Thank you so much, sir. Take care.
Thank you. Thank you, Nishant.
Okay.
The next question comes from the line of Aadil Khan with ICICI Prudential. Please go ahead.
Yeah. Hi, sir. Thank you for taking my question. Sir, my first question is on the standalone segment. We did roughly about INR 600 crore revenue in the standalone book, w hich is a 13% YoY growth. I just wanted to understand, this growth was lagging in the standalone segment. Is this because of capacity constraints or are there any other reasons?
First of all, I'll correct you here. The year ended, the standalone business is not a INR 1,600 crore top line. It's a INR 1,950 crore.
Okay. Sir, I was talking about Q4 alone.
Okay. Q4 alone is INR 600 crore. The total is INR 1,900. In Q4, let's say we have executed 1,750 machine.
Right, sir.
Almost we crossed this quarter is more than 100% capacity. You can understand that how the situation we have faced there.
Right. Just to make sure, so this growth was lagging because of capacity constraint. Is that understanding correct?
Correct.
Right.
Correct.
Sir, on the Huron side, so if this investigation continues, then would we be able to recognize revenue in Q1 of FY 2027?
Absolutely. This is only related to this, the machine was under manufacturing and not available the license. Only those things they have been not recognized and push forward there, basically. Once that license will also will come, once the export permission will come, definitely we can able to recognize those also.
Okay. Apart from that, there will be business as usual for Q1, and once the license comes, this INR 67 crore will get recognized, right?
Yes, get recognized. Okay?
Right. Sir, so incremental-
This INR 67 crore, see, there the margin was very happy. Basically, even we got the hit of INR 40 crore or then a margin side. That also will recognize in future once the machines will be clear out of that.
Okay. Sir, the incremental capacity that will be coming in from September, when can we see ensuing order inflows coming for the same?
Already, let's say, today also we have reached to a INR 4,700+ crore order book there. Okay? You can understand what is the customer's expectation from us there. Already this quarter, we started to taking the orders can we reach more than INR 700 crore. Apart from that, definitely we are going to increase our pace from September onwards there.
Understood. Sir, what kind of inflows are we expecting from the EMS segment, namely from Tata Electronics, and what kind of expansion are they looking at?
Basically, right now they all are optimizing their manufacturing capabilities and capacity there. The delay side we are seeing from all the EMS player there. Nothing has been invested much on a last, component manufacturing in the last 1.5 years there. You know that now ISM 2 and component manufacturing PLI has also been increased. Many more player people are getting these permissions are going to coming out there. Right now, our all the teams are very much busy to multiple customers over there, and we are expecting to see the results very soon now.
Thank you, sir. Mr. Aadil, I would request you to please come back in the queue for further questions. Thank you. The next question comes from the line of Manish Ostwal with Nirmal Bang Securities Private Limited. Please go ahead.
Hello.
Hi, Manish.
Hello. Hi, sir. Sir, I have only one question. Most of the questions you already answered. On the current order book position, what is the execution period, execution timeline, and how much we can execute in FY 2027?
Basically, right now with this total order book, we have a INR 4,700 crore. Based on the commitment, we have to execute in a 18 - 20 months over this.
How much we can see execution FY 2027, sir?
Let's say, we will see the once the capacity on place, definitely we are looking to be a good growth from here.
Will you be in a position to quantify?
Let's say I'm not able to quantify right now, otherwise it will be fixed, the numbers. We need to see that also. Once the capacity will come, we need to optimize and everything to increase there.
Okay. Secondly-
Definitely we will able to tell you in the next three to four months time, once the capacity will be complete there.
Once the capacity commence operation in September, sir, how fast we can see ramp up? Can you just give quality-?
Basically already we have add on the people and everything since last 1.5 years. We are training the people. This is completely once the plant has been commenced and start. We hope that we will increase at least 20%-30% further more on a speeds over here.
All right, sir. All the best for the coming quarters and years. Thank you.
Thank you.
The next question comes from the line of Harshit Patel with Equirus Securities. Please go ahead.
Hi, sir. Thank you very much for the opportunity. Am I audible?
Yes, Harshit. Yes.
Perfect. Sir, firstly, on the execution on the EMS side. As you explained, the client facilities are still not pretty much ready. The execution in FY 2027, will it be more of back ended? We will see more execution in the second half and first half will be relatively muted. Is that the right understanding?
Harshit, already we are running almost 100% utilization in last quarter. Okay? You can understand that without a EMS also we are in the situations today. We are expecting in the second half, if it is coming in the first half let's say almost two months has gone, we are not seeing anything on a much steeper stage is going to be increased in September. Onward September, yes, we are also being ready and we will definitely will capture these opportunities.
Understood. Sir, secondly, we also have a very large aerospace and defence order book. We also execute quite a lot from India as well. Could there be any risk on the India aerospace and defence execution? At the end of the day, the technology comes from Huron. I mean, at least that's what my understanding is. That India execution piece, whatever we supply from here, is that on track or maybe some sort of delay because of this investigation?
Clear to you that this technology is completely from Jyoti now. Okay? It's not from the Huron there. Okay? All the machines what we are manufacturing is more than the Huron. If you look at that, the total numbers, this year we have executed more than INR 800 crore of aerospace and defence. Okay? Almost out of that, around 75% is execution from India only there. This is all Jyoti's own capabilities. In the last 25 years, we learn everything from the best practices from the European side. Now the technology front is completely our own there, and we are not dependent there. We are not seeing any slowdown over here for the execution side from this perspective there.
Perfect. Well understood, sir. Thank you very much for answering my questions, and all the very best.
Thank you. Thank you, Har shit.
The next question comes from the line of Vaibhav Jain with Axis Asset Management Company. Please go ahead.
Good evening, sir. Thanks for the opportunity.
Hi, Vaibhav.
Yeah. Sir, just one clarification that I needed. The order book that we have today, what is the proportion of order book which, where similar constraint on export license not being there is applicable, and then you would want to kind of delay that execution?
Right now in this order book, we have some orders from the Huron side. Out of that, around six machines and close to around INR 70 crore is from Ukraine, because it's just received only on last month.
Okay.
That's the only new orders in this quarter, and that is going to be executed from the Huron, and we need to apply and to take licenses there on next year there. Okay?
Okay.
Yeah.
Sir, as far as this reversal of revenue is concerned, now whatever we have in terms of unbilled revenue, et cetera, we don't expect anything in the coming quarter, right?
Absolutely. It's all done. It will now come from a different way. It will come to a reversal different way. Okay? It will add on.
Right. Sir, as you mentioned, as far as Huron's operations are concerned, you don't see any impact whatsoever because of this development. Can we see ramp-up in terms of revenues in Huron, given the fact that the capacity expansion got completed last year in FY 2025?
Absolutely. There is nothing less in terms of impact of a company's operation, including the order execution, exports, customer servicing, manufacturing activities, anything. We see that now, it's becoming, a lready we have incurred the more cost on a people. We have added around 25 people in manufacturing there. Okay? We entered all the additional new facilities from November onwards. Definitely you will see the quarter-on-quarter, there will be improvement from this last year's number there.
Okay. Sir, would you like to share a number or a range, as in what kind of growth we can see just from Huron? Obviously, India growth is dependent on the new capacity which gets commissioned in September.
In Huron also, basically, let's say the capacity has been increased. Being in a long-term manufacturing cycle, it started from December onwards there. You see that somewhere this our, the execution, let's say the first dispatch and everything will start from the new assembly, is around August and September there.
Okay. Okay.
Yeah.
That's it from my side. Thank you.
Thank you. The next question comes from the line of Mohit Motwani with Tara Capital. Please go ahead.
Hi, sir, good evening. Thank you for the opportunity.
Hi, Mohit.
Hi. On the first question regarding, I think in the past you had mentioned in your previous earnings calls that since you are capacity constrained, you were not taking on much orders in your order book. Given that the delivery timelines were higher than 18 months and customers wouldn't accept a very longer delivery timeline than that. Can you give just a sense of how much of, if you can give any color, how much of that was you did not accept? Now, with the capacity coming up, how much boost it can give to your order inflow growth in FY 2027? Which sectors would it be driven by?
Mohit, basically right now, look at that as in only if I talked about the India perspective over here. It is a great opportunity emerged over here. The Indian market in last three years is consecutively is consuming more than 20% CAGR level of a consumption. We people on all the Indian machine tool builder, somehow we are not able to capture those due to our constraint and all. Imports are surging. Imports are increasing. It's painful for us also. We are also waiting to increase our capacity as much as fast can come over there. Okay? Once that will come, definitely, I'm not able to quantify how much directly we are losing today revenue, let's say today the order book there. It's a huge pipelines are front of us there, and we are not able to capture them.
Okay. Let's say, in your order book moving forward towards next year, you expect this aerospace to come down and auto component and general engineering where you are seeing a lot of traction, that mix to go up. As a result of that, you have mentioned in the past that you will have a 25% EBITDA margin as a steady state. Even with the mix changing, you expect that to continue as well?
Absolutely. We are not looking in the next 5- 10 years. As of now, with this global scenario, the way even the Western Asia, the issue has been erupt. It's become a more uncertainty and fear factor has started. We see that in this area. People are going to invest furthermore. We are already discussing with many of our clients in Europe and everywhere. They all are expanding. China is expanding, Turkey is expanding, Italy. Every area, people have started to investing on the aerospace and defence area there. We don't see there is any decline on the next. That's a very steady state business we are seeing over here then. We are not thinking like that, it will be dropped there.
Okay, fair. Sir, there's a last question from my end. In terms of your debt has gone up from last year to this year, this year to about INR 850 + crore. I understand that would have been for working capital requirements as well. Should we expect any increase in debt going forward? If you can give any color on that's it from my end.
I'll tell you, the debt, what we have increased in this year is close to INR 300 crore, is the debt has been incurred on our capacity expansion, basically. Okay?
Sure.
... On our new capacity there. Only working capital has increased only INR 45 crore to be there. We don't foresee this increment will end of this year. We are seeing that a lot of cash flow will come and the situation with the improvement on our efficiency after the new facility will come. Okay? We don't foresee from here to that has been increased there in terms of a percentage and all.
Okay, sir. Thank you for answering the questions. I'll jump back in the queue.
Thank you. Yeah.
The next question comes from the line of Kamlesh Bagmar with Lotus Asset Managers. Please go ahead.
Yeah. Thanks for the opportunity, sir.
Hi, Kamlesh bhai .
Yeah. Hi, sir. One question on the part of, like say, how much machines we sold, sir? 1,750 machines?
Kamlesh bhai, exactly the number of machine is 1,760.
Okay.
For the quarter four.
For the quarter four. Okay.
The entire year is 5,550 machines.
Okay. Got it, sir. Sir, if I see, we have grown at roughly around 30- odd percent year-over-year. I am just comparing the standalone numbers, because in consolidated there is an impact of Huron. If I see our EBITDA that has grown at 9- odd percent for the quarter in standalone operations, while our machine count, that has increased by 30- odd percent. That reflects that our margin from INR 13 lakh per machine, that has dipped down to INR 10,85,000-odd . Going forward, the higher number of machines are getting compensated by or are getting negated by sharper fall in the margins.
Going forward, can we assume the margins to be in the range of, and that also in a peak quarter... Can we assume that the margins would remain at INR 9 lakh-INR 10 lakh, which used to be at roughly around INR 13- odd lakh or INR 12 lakh-INR 13 lakh?
Kamlesh, every call since last four, five call, I am not able to give you the correct picture for machines and everything, because we have a very much variety of models and all like that. Okay? And, the n umber of machines. Ultimately, what I said always in a past to you, and my answers are remaining same, that we will be at EBITDA level margin at total level of a standalone or a global. We will not go down by 25%. If you imagine this, even this event happened, and we have taken this all deferment on revenue and margin. Still, we are at 25%, near to 25% this quarter also.
No, like, sir, the realizations, like INR 34 lakh, which is the lowest since our listing-
Yeah.
... per machine. INR 34 lakh realization. It is the lowest since our listing.
This year, the total realization is INR 35.62 lakh.
Yeah. No doubt we are increasing the capacity, but that entire benefit is getting negated by lower realizations because as we have to sell more and more machines. Can it be right in saying that going forward, our realizations would remain at INR 35- odd lakh and with a margin of 25- odd percent?
See, I'll tell you one thing that even though Kamlesh bhai, we have discussed in a past call also, and I have told you that the way number of machines are going to increase. The machine average price going to reduce. Okay? Our margin profile, let's say it's going to be at 25%, 25%+. It will be remained there. Okay?
Okay.
Even let's say, we see that in a forward situation, okay, in our... This additional, the 6,000- 16,000 machines, if we reach to a full capitalize, let's say full utilization. Even the margin, let's say the machine average price, will reach to INR 30 lakhs-
Okay.
... still will be at around close to a 25% only.
Okay.
It will not go down there.
Secondly, our EMS order book that has been static at INR 700 crore for last two years, or 1.5 years. Sir, don't you think that now with the order book at those levels and from there, the cost would have increased significantly, so we won't be making margins on that EMS order book? That's 1.5 years.
In fact, we'll do a more better margin right now because whatever the prices was fixed up, okay, all was connected indirectly with the dollar terms permission, okay. Basically, while we will execute, we will gain more there.
Okay, great. Sir, lastly, any target for machines in FY 2027, sir? What is our target? How much we could be doing? This year we did 5,500 machines. What is the target for next year?
Let's say we are seeing that in September, once everything will completed, okay. We see the steep growth should come. Exactly, I'm not able to tell you the number of machines and all, because only I'm going to get last six months available with me there. That also, we will set right the people and everything. We'll have good numbers there.
Okay, great sir. Thanks a lot.
The next question comes from the line of Ruchit Agrawal with UNIFI Mutual Fund. Please go ahead.
Yes. Hi, sir. Thank you for the opportunity. I'm fairly new to the company, so just excuse me. One broad question on the Huron. I believe we bought the company about 20 years back, I think 2007. Just want to understand, 20 years in now, our revenues are broadly similar to what they were at the time of acquisition, slightly lower in fact. Just want to understand what has been the due course when we look at Huron, even in terms of Huron in itself and the tech integration for Jyoti as well.
Thank you. Very interesting question you asked, so I'm able to express nicely there. See, the 20 years back, when we bought Huron is same as today. Okay? When we took over this company, Jyoti's top line was INR 50 crore. Okay? Today, we are at close to INR 2,000 crore, okay? That's the technology and everything. Let's say basically the operation excellence, how to do the precision manufacturing, everything, we learn and we implemented over here. We have grown up over here. Okay? That's the one part. Second, in this journey, the first time when we bought Huron, then after the first time we could able to invest only in the last year. Okay?
As it is, let's say when we took this company, we have never invested any single euro over there for expansion of a capacity and everything to be there, because we were not in a position to invest further more over there. Okay? Only in the last year, we have invested and increased the capacity. We will see in future to be execution also increasing from there. Whatever the things are we are doing the business is putting into account of over here. We are exporting from here to all global over there, basically. You see this is in a consolidated base advantage over there, basically.
Got it. That helps a lot, in fact. Sir, second question on the ongoing investigation bit, as you mentioned that it's very tough to figure out how that pans out. If you can help us give some color, if some sort of similar investigation has happened in the geography and how that has panned out, and if maybe that can help us understand maybe how the Huron investigation panned out as well?
Let's say I cannot able to give exactly the name of the company and all, but you can just, in this world, very simple, if you ask to any AI or let's say any of the Google or anything, you can able to find out how many investigations are going on since last three years there.
All right, sir.
In Europe, right now is a new normal there.
Okay. All right, sir. Thank you for that, and wish you all the best.
Thank you. Thank you.
Thank you. The next question comes from the line of Aniket Jain with YES Securities. Please go ahead.
Good evening, sir. Hope you can hear me? Actually, I wanted to-
Yeah, Aniket. How are you?
I'm good, sir. How are you doing?
Fine. Fine. Fine.
Sir, your capacity expansion will be complete soon, and I think you previously mentioned that about 60% - 70% of that will be used for EMS. As of now, our EMS order book is quite low. I wanted to check if the capacity is fungible and if we can produce maybe aerospace defence or auto machines from that, and then we can maybe export it or it can be utilized in India? Is the capacity fungible, and how much additional CapEx we'll need to incur on that?
No, it's fully fungible from general engineering, auto, dies and molds, and all the areas there. Okay? We are able to utilize fully on that, basically. Aniket , let's say today, I'd like to tell you again, and every call I am telling to the people. Last year, we were having 14,000 customers. This year, we have crossed to be 15,000 customer there. The small MSMEs and all these manufacturing area in the country is increasing drastically there. Just to tell you that the last year, in my town, in Rajkot alone, we have sold more than 1,000 machine over here.
That's quite a big number, sir. Yeah.
Okay?
Yeah.
It all are fungible, and we are able to execute nicely there.
Understood, sir. Sir, my second question would be, are there increased momentum in auto as well as general engineering? What kind of machines are these? Would these be higher end, mid-level, or entry-level machines? Maybe if you are able to give the order book split as per the high- end, mid-level, or entry-level machine?
Yeah, I can give you that. I'll tell you, we are now more and more seeing the more and more machines people are looking with automations. Okay? The manpower shortage is everywhere people are seeing, and Jyoti is a very forefront in this area. We are getting more and more in automations over here, and that's the new normal we are seeing, even in auto, in general engineering, and everywhere there, basically. The income for this- Yeah. The pending order book.
Order book split as per high end?
Yeah. I'm giving you that one.
Order book split.
Order book. Yeah. Basically, right now, let's say the aerospace.
Yes, sir.
is close to 38%. Okay?
Yes, sir.
Auto and auto components are 19%. General engineering is close to 20%.
Sir, actually, I wanted to check. Out of this aerospace can have mid and high-end probably. Auto can have entry-level-
I'll give you [the incomes first here.]
... Mixed to [Non-English content] entry, mid, [Non-English content ]
Basically, in aerospace and defence-
Yes, sir.
... is largely on a high end. Okay?
Largely high end. Okay.
You can consider, yeah, largely all are in high end there, basically. Almost our 40% is in high end and 60% in entry level and mid level there.
60% is in entry level and... Basically, autos and general engineering would be mostly entry and mid level only.
Correct. Correct. Correct.
Okay. Sir, if I can squeeze in one more?
Our definition, I'll again tell you what is the definition we have identified there. Okay. Up to INR 50 lakh machines, we consider to be entry-level product. From INR 50 lakh to INR 2 crore, we consider a medium, let's say, a mid-range machine. Above INR 2 crore only we consider the high-end machines.
Understood, sir.
Sure.
Maybe if I can squeeze in one more. I just wanted to check on the ongoing investigation. Is the total revenue reversal complete, or is there any possibility of further revenue reversal as well?
No, only-
I also-
Yeah. Just ask, no problem.
I also read somewhere that maybe that was a document from Ukrainian government that we have delivered some machines to maybe Russia also. The machines that are in question, are those machines that have been already delivered to Russia as per the claims by Ukrainian government? Are those into the question, or these machines are yet to be delivered?
First of all, you are telling something I am listening the first time, because there is no Ukrainian government is here in this part over. Okay?
Okay.
Basically, it's the French government is investigating. Okay? This is a normal investigation, sir. They are checking what are our exports ordered today, what we have delivered in past, and what is going to be happen in future. That's the only investigations are going on there, basically. Okay?
Got it, sir.
There is no Ukrainian government. In fact, we have received a good order from Ukraine right now.
Indeed, sir. Sure, sir. These were my questions. Thank you so much.
Thank you.
The next question comes from the line of Shrenik with Indo Aalps Wealth. Please go ahead.
My question is also related to Huron, and probably similar to what the previous participant had asked. The question is, was the Jyoti management aware of this alleged Russia via India re-export channel during the years 2022 - 2024? What due diligence on Huron export compliance was performed during that period?
First of all, we have never exported anything. The machines come from France to there to here, okay, t o Russia there. By the way, for the input for you that whatever the machines Huron built there, almost 70% goods are coming here to India. They just have the assembly there.
Yeah. This is getting rerouted into Russia, and that's the reason for this investigation.
Yeah. We have not made any rerouted there. That's we are going to prove out there basically. Because all the machines, the Jyoti has been full capabilities and Jyoti only has dispatched at 2022, 2023 there. Okay?
2022, 2023.
We have not exported to Russia at all there. Okay?
Yeah. During that time, the export had happened, and probably for that only this investigation is happening right now.
Yeah.
What you're suggesting is this is no longer the case.
Yeah.
No longer, any, none of this is happening to Russia?
Correct.
I mean, your general manager there has been put on suspension, so I'm sure-
Correct.
... it is not an ordinary investigation, right?
Correct. Basically, any investigation, and particularly like this, there is a standard protocol that general manager cannot be reached out to any inside material and all. Okay? They want it to be a fair investigation over there. It put onto their hold at that home. Yeah. Okay?
When we are looking at similar kind of cases in other companies-
Correct.
... we are seeing that the base case for such kind of investigation, the timeframe is-
Correct.
... anything between two to three years.
Correct.
Even when you look at the INR 67 crore revenue that could not be recognized-
Correct.
... the chances that it will get recognized in the next 24 months are also, t here could be chances that they may not get recognized for next two, three years as well, right?
No. We are not looking that because the machines are absolutely are in a queue to get the licenses there. Okay? There is sure that this is basically very sure that the investigation, the conclusion will take very longer time. Until today, they have not concluded anything. It will take very long time. Two years, three years, five years, we don't know. We can't comment on that also today.
Correct. Because we have similar experience in another company. As you rightly saying, a much longer time-
Yeah.
... in the whole process.
Yeah.
The entire money had to be-- That is the reason why your auditor probably mentioned that it should be not recognized completely while you take in the cost.
Correct.
This really puts the whole Huron into a significant drawdown for you rather than an upside. Of course, the India business is doing extremely well and will grow extremely well once the new capacity comes in. Drawdown from the Huron, is there a chance for you to sell out that business completely?
Not at all. We are not looking at all because we have been very well recognized over there to all our customers, and we are very much near to our customers. We don't foresee anything like that.
Okay, sir.
Yeah.
Shrenik, does that answer your question? Okay. We'll move on to the next question. It's on the line of Yash Ginoria with Moneybee Securities. Please go ahead.
Good evening, sir. Am I audible?
Yeah.
Sir, firstly, I wanted to understand the revenue of standalone Huron. What is the standalone revenue of Huron?
EUR 25 million is close to... One second. In a quarter four is INR 25 crore.
Full year, I'm assuming INR 100 crore?
One second.
INR 248 crore full year.
Full year is at INR 248 crore.
Sir, how much of this is intercompany? How much is it supplied to Jyoti?
INR 105 crore.
INR 105 crore.
Okay, sir. Since we are expanding our capacity, I wanted to understand the utilization. How do you see the utilization of this capacity? If you can quantify in percentage terms.
We see that, let's say in September it will come, so it is only available for us the next six months. Okay?
Right.
Yeah.
Year forward, sir. FY 2027/ 2028.
Yeah. FY 2026/ 2027, the capacity is coming only in September there. Okay? It means only the last six months are available to us there. We see that a number of machines initially will start and everything. Close to, you can say, additional, let's say right now we are almost 100%. But the 50% of that area, we will reach maybe around 8,000 something machines to be there. 8,000 or 9,000 + machines.
By FY 2028?
FY 2027 end, we are trying to do that.
FY 2028? Anytime.
In the past also, I told you. This is all our base on today. How we are able to execute through the people and all. We maintained our momentum close to 25%-30% year-on-year.
Okay, sir. Understood. Thank you.
Yeah.
Thank you. The next question comes from the line of [Rohan Sawant] with [Praag] Capital. Please go ahead.
Yeah, thanks for the opportunity. Sir, I just wanted a clarification on your standalone revenues and consolidated revenues that you've given in the PPT, both of which for Q4 FY 2026 are INR 599 crore. They don't match with the reported numbers. Are there any adjustments, and why are both these same numbers? Because there is some revenue at Huron also. Can you just explain these numbers, sir?
Let's say because of this elimination in this quarter. That's why these, let's say, numbers coming near to same, but it's because of elimination. Intracompany elimination.
Okay. Whatever INR 25 crore that Huron did, it was sold to the standalone entity, so it got eliminated while consolidation. Is that right?
Correct.
Okay. Sir, when I look at your reported numbers, say, your standalone revenue reported in the P&L is INR 529 crore and in consolidated report, that is INR 575. In PPT it is INR 599 crore. There, what am I missing?
One second. First of all.
Okay, sir. Sorry.
Yeah, you're it is. It's not like that you missed. That's the last year, basically.
Yes. I got the answer for the first question, which is elimination during consolidation.
Yes. Correct.
Okay. Sir, against INR 248 crore that we did in Huron this year. Q4 is only INR 25 crore, that too only to standalone. When does Huron recommence its other operations, its business which is not to the standalone entity, and how much would that be in your estimation for FY 2027?
FY 2027, we are seeing to come to a normal level first, and that normal level is close to INR 300 crore-INR 350 crore. Okay?
In Huron?
Yeah, in Huron. Standalone level there. Okay? That is our expectations from this year.
Sir, in FY 2026, you did INR 250 crore, INR 105 crore of which were to standalone. You did only INR 150 crore net. Against that, you can double the revenues in FY 2027 in Huron?
No. Basically, it's eliminated because all the supplies are going from here.
Okay.
Whatever the Hurons are being manufactured, all the components, sub-assembly being manufactured over here, basically. Yeah.
There will be growth in Huron FY 2027 versus FY 2026?
Absolutely. Absolutely.
Okay. Thank you, sir.
We have a very robust order book and execution. New capacities also, people also have been there. We see there is a robust execution we'll see on second quarter onwards there.
Sir, this growth in Huron, is it dependent on you getting the licenses you've been saying in the call? Because in Q4 it seems there was no other revenue that Huron did.
Basically, it's a reversal has come. That's why it's no revenue there. It's an [hit] has come only on quarter four. Yeah.
Sir, sorry, last question, sir. If there was no reversal, what would have been I mean, Huron's revenues would have been gross and minus INR 67 crore. INR 25 crore + INR 67 crore would have been its normal revenue.
Absolutely.
It was INR 67 crore, so it came to INR 25 crore again. Okay.
Correct.
Also this revenue of INR 67 crore, yeah.
Yeah. INR 67 crore with the net revenues could be extra there.
Okay. Understood, sir. Thank you and all the best.
Thank you. Thank you very much.
Thank you. Ladies and gentlemen, due to time constraint, that was the last question for today. I now hand the conference over to the management for closing comments.
Thank you all for joining us today. I hope we have addressed all your questions. We remain committed to keeping the investment community informed with the regular updates on any development in the company. For any further information or queries, please feel free to reach out to us or SGA, our Investor Relations Advisor. Thank you very much to all of you.
Thank you. On behalf of AXIS Capital, that concludes this conference. Thank you for joining us, and you may now disconnect your lines. Thank you.