Growth beats guidance, but ₹53Cr net loss tempers near-term outlook

Delivered ₹395.5 Cr matches ₹3,955 million stated; 55% YoY exceeds 45–50% FY27 guidance

Operational EBITDA ₹42 Cr (Q4) → ₹148 Cr (Q1); consumer EBITDA loss ₹473 Cr → ₹361 Cr (₹112 Cr improvement)

Reported net loss ₹53.2 Cr despite 55% revenue growth; consumer segment EBITDA loss ₹361 Cr contradicts profitability narrative

Aerospace revenue ₹3,222 Cr (40% YoY); segment EBITDA ₹731 Cr at 23% margin; beats FY27 guidance of 25–30% growth

Consumer loss improved sequentially but still ₹361 Cr EBITDA loss; path is on track IF utilization reaches 40–50% by Q4, unproven

Q1 delivered 40% revenue growth, 23% EBITDA margin vs. FY27 guidance of 25–30% growth, >20% margins. Order book crossed USD1B (USD889M Q4). New Safran wheels contract (15-year, single-source) validates market trust.

Revenue +16% QoQ to ₹734 Cr (consumer up 190% YoY) but capacity utilization dropped 23% (Q4) to 22% (Q1). Management attributed to better yield/mix, not additional capex, but analyst skepticism on credibility.

Loss narrowed ₹112 Cr (24%) sequentially from ₹473 Cr to ₹361 Cr. Trend supports Q4 FY27 breakeven guidance, pending utilization ramp to 40–50%.

FY27 45–50% consolidated growth, doubling operational EBITDA targets unchanged. Q1 delivered 55% growth, ahead of pace, but management did not upside the full-year guide.

Originally ₹160 Cr aerospace / ₹500 Cr consumer capex within ₹660 Cr FY27 total. Management flagged potential acceleration of aerospace capex to support new order book, offset by consumer capex contingent on utilization ramp.

15-year agreement, single-source, 100% Make in India. First time customer outsourced wheel manufacturing. Higher margin to Aequs than typical, but specific figures not disclosed. Will reflect in next quarter's order book.

No capacity expansion. Revenue growth from enhanced throughput, better product mix, improved execution—better utilization of existing assets via yield. Confidence in Q4 breakeven still intact.

Consumer electronics capitalization ended Q3; commercial operations and full depreciation started Q4 (₹455 Cr). Q1 similar. Will remain at ~₹450 Cr per quarter unless further capex added.

Consumer utilization will improve to 40–50% by Q4, driving higher Q4 revenue. This Q4 spike takes full-year to 45–50% growth, reaching ₹1,700–1,800 Cr.

Consumer asset turns 1.5x. Steady-state ROCE 18–20% same as aerospace. Capex deployed against 18–20% ROCE hurdle rate.

No specific changes due to tariffs. Customers have strategic global supply chain view; Aequs allocations stable. Aerospace and consumer unchanged.

INR1,900 Cr over 10 years (not next year). First phase Sep–Mar FY27–FY28. Revenue ramp FY29. Engine and landing gear focus. Phased vertical integration by 2030.

We look at consumer holistically; no split disclosed. Both toys and electronics have strategic customers committed to growth. Utilization cuts across both; tandem ramp required. Mattel scaling well on toys side.

Milestones: PAT break-even H1 FY28 (consolidated), consumer PAT break-even FY30, decent PAT in FY31 (~20% steady-state ROCE). No specific PAT margin % disclosed beyond milestones.

Capex for capacity augmentation and new programs. If utilization ramp doesn't happen, some portion won't be deployed. Disciplined approach.

99% imported. No qualified aerospace-grade suppliers in India yet (only 2 aluminum grades qualified for forging). Long ecosystem development journey; unlikely to change soon.

Located in Tier-3 (Belagavi); recruited fresh talent regionally; trained from scratch since India lacked aerospace capability. JVs help build capability. Inherent organizational DNA to develop people.

Q1 delivered 55% growth (ahead of pace). Aerospace on track 25–30%; consumer 125–150%. Supported by USD1B+ order book and utilization ramp.

Q1 delivered 40% growth at 23% margin. Order book scaled to USD1B+; new Safran and Tier-1 contracts in pipeline. Capacity additions ongoing (1 machine/week).

Q1 delivered 190% YoY growth but still ₹361 Cr EBITDA loss. Utilization at 22%, must reach 40–50% by Q4 (3 quarters). Sequential loss narrowing ₹112 Cr validates path but execution risk remains.

FY26 operational EBITDA ~₹90 Cr; FY27 target ~₹180 Cr. Q1 achieved ₹148 Cr operational EBITDA. Second half will see consumer breakeven inflection; weighted to H2.

Aerospace currently 23% (exceeds range). Consumer targeting 18–20% on steady state (1.5x asset turns, 18–20% ROCE). Both guided on 5-year plan to FY31.

Q1 capex ₹830 Cr deployed. Aerospace capex may accelerate to support order book >USD1B; consumer capex contingent on utilization ramp (flexible).

Capital intensity increasing. Hosur first phase Sep–Mar FY27–FY28; FY29 revenue ramp. JPV/vertical integration phased by 2030. May require ~USD150 Cr equity raise.

Consumer at 22% utilization (Q1), target 40–50% by Q4 FY27 for EBITDA breakeven. Only 3 quarters to nearly double utilization. If ramp stalls, breakeven slips and consumer losses extend.

Net loss ₹53.2 Cr despite ₹395.5 Cr revenue (+55% YoY). Depreciation ₹453 Cr (up 84% YoY) and consumer EBITDA loss ₹361 Cr mask the operational EBITDA improvement. Path to consolidated PAT profitability unclear.

99% of raw materials imported; only 2 aluminum alloy grades and limited super-alloys qualified in India for aerospace. Any tariff escalation or import controls could constrain margin expansion or supply security.

Other income fell ₹212 Cr QoQ (₹279 Cr Q4 → ₹67 Cr Q1) mainly due to forex gains reversal. This volatility masks the underlying operational margin and complicates guidance credibility.

Consumer electronics is one of the largest global consumer electronics brands (name withheld for confidentiality). No other customer detail disclosed. Heavy reliance on single large OEM creates concentration risk.