Rishabh Instruments Ltd (NSE: RISHABH) Q4 2025 Earnings Call dated May. 27, 2025
Corporate Participants:
Unidentified Speaker
Narendra Joharimal Goliya — Executive Chairman
Dinesh Musalekar — Whole Time Director
Vishal Kulkarni — Chief Financial Officer
Anand Takar — Director of Finance
Analysts:
Unidentified Participant
Bhoomika Nair — Analyst
Prateek Giri — Analyst
Tanay Shah — Analyst
Avinash Nahata — Analyst
Presentation:
operator
Ladies and gentlemen, good day and welcome to The Rishabh Instruments Q4FY25 earnings conference call hosted by DAM Capital Advisors Limited. This conference call may conclude contain forward looking statements about the company which are based on the beliefs, opinions and expectations of the company as on date of this call. These statements are not the guarantees of future performance and involve risks and uncertainties that are difficult to predict. As a reminder, all participant lines will be in the listen only mode and there will be an opportunity for you to ask questions after the presentation. Should you need assistance during the conference call, please signal an operator by pressing Star then zero on your touchtone phone.
Please note that this conference has been recorded. I now hand the conference over to Ms. Bhumika from Dam Capital. Thank you. And over to you ma’ am.
Bhoomika Nair — Analyst
Thanks. Good evening everyone and a warm welcome. To the Q4FY25 earnings call of Rishabh Instruments Ltd. We have the management today being represented by Mr. Narendra Golia, Executive. Chairman Mr. Dinesh Kumar Muslekar, Whole Time. Director and Mr. Vishal Kulkarni, CFO and. Mr. Anand Lada, Finance Director Blumen.
At this point I’ll hand over the. Floor to Mr. Bolia for his initial. Remarks post which we’ll open up the. Floor for Q and A. Thank you. And over to you sir.
Narendra Joharimal Goliya — Executive Chairman
Thank you Vumika. Good evening everybody. Thank you for joining this call and financial results of the full year as well as the investor presentations have already been loaded to the stock exchanges and company’s website. We hope you had an opportunity to review because that’s why then only this call will become more meaningful as we look back on the financial year 2025. We are proud of the resilience and adaptability demonstra demonstrated by Rishabh’s team by navigating a complex and dynamic business environment. More importantly, FY25 was also a year of innovation and long term planning. While addressing immediate challenges, our teams remain focused on building for the future.
We make significant progress on the R and D front culminating in the creation of a clear five year product roadmap and roadmap strategies for the next phase of growth for Rishabh. We all know, however good you are today, if you don’t innovate, if you don’t develop new products for the future, then today’s products cannot last you for more than a couple of years. And we are really involved in that. In parallel we undertook our organization changes aimed at strengthening leadership and improving strategic alignment. Notably Mr. Dinesh Kumar Muslekar who is on this call transitioned from Group CEO to whole time Director and he will talk a little about the changes he has done.
Further key appointments were made across the management and Senior leadership team including a new Chief Operating Officer, a new Head of International Sales, a new Head of Solar Business in India and Head of Procurement in China. Some of these positions have been newly created and some of them are transitioning. We also appointed Mr. Nishan Dedoria as additional General Manager. His role will be to oversee business strategy, finance and public relations functions. These steps, all these new appointments or replacement appointments are intended to enhance professional depth and drive greater solidity across business units in different countries.
Speaking of our performance in the last quarter as well as the last financial year, we have continued to show resilience across our core businesses. Our electronics business in Rishabh India and Lumal SA have delivered steady growth with reported EBITDA margins crossing 20% plus mark in Q4, underlining the strength of our core capabilities which is the electronic business product portfolio and cost efficiencies throughout. Further, our Lumel Alukash division demonstrated commendable resilience achieving a notable improvement in adjusted ebitda margin of 0.2% in Q4FY25 as compared to minus 3.7%. So we are on the right path. Decisions which we are taking are giving us results and I am sure future will be much better than the past.
This is in spite of the underlying economic conditions of the European region. All people who are in this business know the turmoil which is being created in Europe, especially with the American decision to put duties on imported cars. Many of the German automakers have stopped shipping to America and that is of a direct concern to us because the aluminium division supplies to most of the companies which are suppliers to these big brands. So the housing and other parts which are supplied by Luma Lelukas will have a slowdown in the demand and especially the EV industry where China has really overtaken all the European people both in competition and in quality.
And that has a bearing on the EV parts that we supply to big companies like Velu and others. The consolidated revenue witnessed a modest growth of 4.5% in the last full complete financial year with adjusted consolidated EBITDA at 8.9%. The electronics business revenue at Rishabh India and Lumel SA grew at 9% with reported EBITDA margins of 15.5% post adjustment of ESOP cost for FY25. The aluminium diecast showed a dip in revenues to the tune of 2.7% primarily on account of our conscious effort to reduce the low margin automotive business. Because of the pressure on the automotive industry, they have put pressure on their vendors and therefore it is not profitable to supply to the auto industry.
And that is what we are seeing in reduction in turnover. This reduction is a conscious effort to curb losses. From our legacy contract signed before COVID pandemic, it never happened. The kind of cost increases we saw in the last couple of quarters and therefore some of the contracts were signed before the COVID pandemic and we have gradually withdrawn telling our customers to find other solutions. And you know, obviously pandemic clauses had no escalation clauses except on the raw material which constrained our pricing flexibility and severely disrupted our operating margins. However, we are very, very confident about the future.
And two new buildings are under construction. One at F31 which will add about 67,000 square FE to the existing 98,000 square feet and another at C6 which will add about 82,000 square feet to the existing 38,000 square feet which is a six story building, giving an increase of 110% to the built up area at the Nasik location. This will really give you the kind of investments which are being made and the kind of confidence which we have in becoming future. We have established a state of the art SMT lines at both our Rishabh and Lumal SA facilities.
Now this really helps you to do the SMT business with far higher quality. You know, SMT business itself is a quality business, electronics business, you cannot afford to. You know, people have started talking not parts per million, but even parts per billion. So these installations will enhance our production capacity and precision in electronics assembly. Further to the optimization of our manufacturing, we are transferring electromechanical production including legacy Lumal SA plant. This strategy move consolidates operations and improves efficiency initiatives will augment our manufacturing and R and D capabilities to fuel the future growth. Moreover, in line with our sustainability goals, we have commissioned a 1.5 megawatt solar plant at our Lumal Alukast plant.
So again it shows in the last two years the energy costs have gone up substantially in Europe and especially in Poland. And therefore we have taken this initiative to put a 1.5 megawatt solar plant initiative reduces our carbon footprint, of course and also supports our commitment to green energy. We are company, if you remember last time I talked about our center for Innovation in Green Energy which we are establishing at IIT Jodhpur. And this is another step in the direction of using more and more green energy and less and less of black Energy as they call it.
We remain committed to our strategic direction to deliver sustainable long term value for all stakeholders. We believe that there are significant opportunities ahead, particularly with the substantial investments being made in clean energy and infrastructure development by Rishabh and the Rishabh Group. These trends are driving demand for our products positioning us well to capitalize on the growth avenues. It is also pertinent to note that European automotive sector is experiencing intensified competition from Chinese EV manufacturing I just mentioned due to aggressive pricing strategies and rapid technologies technological advancements by Chinese players leading to a reduction in demand for locally sourced components.
This shift has resulted in increased pressure on our aluminium die casting business. Despite these challenges, we are proactively adopting and focusing on high value application and exploring new market opportunities to mitigate the impact of this competitive build other than automotive sector. Also, there is a big demand for aluminum components and we are focusing more on that and less and less on auto business. FY26 will be a year focused on scaling electronic business further along with the introduction of new products to the US and European markets. We are confident of delivering strong growth in our electronics business segment in the coming years driven by robust demand, operational readiness and a clear focus on execution.
We have got a lot of approvals both for the European and the UL for the American markets to help us build scale on these businesses. On die casting business, we are strategically addressing challenges by focusing on improving their profitability and and operational efficiency. We sincerely appreciate the continued trust and support of our investors, employees, customers and all partners that we deal with. Your confidence in our vision and execution is invaluable as we navigate the evolving market landscape with a clear focus on innovation, operational excellence and stakeholder engagement. We are proud we are poised to achieve enduring success and create meaningful value in the years to come.
With this, I will hand over to Dinesh Muslekhar to take you through the operational highlights for the Q4 and financially ended March 25th. Over to you Dinesh.
Dinesh Musalekar — Whole Time Director
Thank you sir for that rounded summary of the year that we just completed and good evening ladies and gentlemen. We are pleased to report a consolidated revenue, as Mr. Pulia just now suggested, of 4.4% in financial year 25 on year on year basis and 5.4% in consolidated revenue for Q4 FY25 on year on year basis. The consolidated adjusted EBITDA margin stood at a decent 8.9% in FY25. Our standalone revenue at Rishabh India saw a robust growth of in excess of 15% in Q4FY25 both on quarter to quarter basis and year on year basis, the annual standalone revenue grew by 6.5% with a standalone adjusted EBITDA margin at 16.8%.
In financial year 25 we had robust growth of 19% in India for Reshab domestic sales in FYI 25 we are confident that in the immense growth potential of our business in India driven by governmental infrastructure development initiatives. In the last Union budget, as you know, the government of India allocated 11.1 lakh crores for capital expenditure, emphasizing a significant focus on infrastructure development. Our expanding product portfolio positions us well to capitalize on these opportunities, particularly in sectors such as renewable energy, transportation and industrial automation. As infrastructure projects progress, we anticipate increased demand for our product which will directly contribute to our performance and growth in the near future.
Further, our Lunel SA business continues to perform exceptionally well with a significant growth in both revenue and EBITDA margins. The revenue for the financial year 25 grew by 14% year on year basis and reported EBITDA of 20.4%. This success is driven by strong demand in industrial automation sector and ongoing investments in innovation and capacity expansion. And I would also like to highlight that we won three prestigious awards for our performance over the last three years in Poland, one of them being Forbes. Another one is for the Lubusky Innovation Award for the best innovative company in Lubuski region in Poland and the third one for Gazeta Lubowski.
This is for the performance of top 50 companies in Poland. So all our efforts have been recognized and rewarded as well. So the strong performance underscores the robust demand for our industrial automation devices, particularly from the manufacturing sector in Europe, which will help them to optimize their energy and efficiencies. So all our industrial automation products are really helping to overcome the cost challenges that the companies are facing in Europe and the other sector which we are going is our electronics manufacturing services ems. So we have put this additional we have total four SMT lines. Two of them are relatively new which support EMS business.
One of them has been installed just a few weeks ago which Mr. Goliath talked about during his speech. So this has given us 100% year on year growth in the last financial year. Even though we have challenging time in Europe generally for all the industries, including ours, we have outperformed it by having a lot of mitigative strategies to have our eggs in different baskets. Coming to Lumel Alukast, as you saw that on a year on year basis we have a decline of 2.7% primarily due to our strategic decision to reduce the Exposure to legacy automotive contracts.
You know, even though we had a possibility to increase by 20% of our sales turnover in financial at 25 because lot of those automotive contracts were making losses, we went to very long patch of six months, very hard negotiation with our biggest automotive client and successfully concluded all those contracts with price increases and limited supply contract. So that’s how we are focusing on improving the bottom line and optimizing the top line. Even though we have reduced 2.7%, we have been able to increase our bottom line by 390 basis points on EBITDA from quarter to quarter basis.
So again, we are optimizing not only on the prices, but also we are working very hard on optimizing our material cost and labor and other expenses, including the overheads. So further in Lumel Alukkas, we have withholding tax assessment from Polish tax authorities in line with our conversation. Financial reporting practices, conservative financial reporting practices. We have classified the associated provisions as one off item in our financial statements. While the subject is still subjudice, our tax council advisors have suggested that the outcome may be favorable for us. So this is one of expense which we have provided for.
Looking ahead, our strategy involves scaling down the automotive segment from approximately 40 45% which is currently to about 20 25% of our aluminium die casting portfolio. This shift will allow us to focus more on non automotive businesses which offer better profitability and more stable volumes and less turbulences are experienced over a long period of time on those industries which include industrial automation, electrical industry and lighting industry, etc. So we anticipate that this transition will lead us to positive EBITDA by end of financial year 26. We are very actively engaged in increasing our non automotive portfolio by adding new projects and customers.
Our teams are diligently working to enhance profitability and operational efficiencies, demonstrating resilience and determination in navigating these transitions. Overall, at a broader macroeconomic environment, the automotive sector in Europe remains under pressure. Mr. Golia highlighted a lot of insights about that. Several OEMs have instigated product line cuts leading to a reduction in order volumes, a trend that may persist for next few months. Adding to this uncertainty evolving on global trade environment, the recent policy shifts and potential tariff measures under the new U.S. administration, all these have introduced additional volatility and caution across global supply chain. Despite these challenges, we remain focused on strengthening our fundamentals of our business, improving our margin profile.
We believe that our diversified customer base, strong product pipeline and growing demand from sectors like industrial automation EMS will help us navigate these Headwinds. We have significantly ramped up our capacity and strengthened our team on the ground to support future growth. On the demand side, we are seeing encouraging signs. Domestic sales in India are rapidly increasing and our international markets in many segments where we previously experienced a dip are now showing signs of recovery. Overall, I would say the momentum is positive and we are optimistic about the year ahead. In particular, we expect a strong growth to be driven by EMS and solar sectors, both of which are seeing robust demand and align well with our product capabilities and long term strategy.
So you know we are working on three segments. One is we are expanding our capacity, we are expanding our product basket. We are also making our team stronger so that we have a long term view and actions aligned to get us where we want to be and a little bit more on our other international subsidiary which are relatively smaller. Our operations in China has shown healthy top line growth. We grew by 20% there. However, EBITDA performance remains near to breakeven. So we made investments in last two years there in R and D and other activities.
So now from this year onwards we will be having results coming out of that in US market we had a really good year with 60% revenue growth with very very healthy margins and we closed the year with US$2 million. Now this year we have much similar target and we we feel that for the coming few years this kind of growth we can expect until we reach something like five to six million dollars there. And then UK business faced some challenges. The top line remained relatively flat. EBITDA we had slightly negative. But this year this should be good in order to offer more value add to our customers.
We acquired 100% shares of Microseech Republic based company. This is specialized in SCADA software development. This acquisition helps us to complete give our customers complete comprehensive solution along with our high end products. And we acquired this company in August 2024. We remain committed to strengthening our international presence and are optimistic about the growth prospects in these regions. Over the past year we have made significant strides in strengthening our organization through strategic team development initiatives. Mr. Golia talked a little bit about that. I will add more to what has been said. Recognizing the importance of leadership in driving next phase of growth, we have focused and aligned our teams to enhancing their capabilities to meet the evolving demands of our business.
So these are some of the key appointments which we made. We appointed chief operating officer for day to day activities and efficiency improvement and putting systems in place with more than two decades of very big EMS and electronics manufacturing experience. Then we added quality head recently with More than two decades of experience to get the quality systems and quality performance to next level. Then we also added R and D head for, you know, electromechanical products with a professional with 3.5 decades of design experience. More products in current transformer, voltage transformer and potential transformers targeting US market and other markets and going from low voltage to mid voltage product group.
So this is also a long term plan which we have. Then we have new head of international sales with good experience of close to two decades and in international sales to make our international growth opportunities. And then we also have hired new head of solar sales with experience from solar industry with one and a half decades of experience and lot of energy. So this is something which we are making. And then for the procurement side we added a head of procurement in China to help, you know purchase of electronics for the groups and some capex as well as some mechanical parts from China.
So this also sits very well with our long term strategy. And then Nishant is attending this meeting also has joined us as additional GM to oversee help me with strategy, finance and PR activities. And then we added two seasoned sales professional for supporting USA business to expand. So we are creating a robust team. This is creating a lot of bench strength for tier 2 and tier 3 level in the organization for future. These. As I said, these strategic appointments are designed to foster our management bandwidth and enhance our ability to scale efficiency across geographies and different verticals.
We are confident that these leaders will play a pivotal role in driving our continued success and long term growth. Our commitment to innovation is further demonstrated by successful rollout of comprehensive five year roadmap. We had this big one week workshop in Cyprus getting all the RND heads and together. And after that workshop we created a strategic roadmap projecting to generate incremental revenue equivalent to nearly 50% of our total electronic sales. I mean when all these products mature. So that’s the kind of potential that these are having. So this is a pipeline which we created for five years but we already started working on the first two years.
We also created concept of center of excellence to optimize our R and D resources because we have five R&D centers for electronics manufacturing. So we have assigned different R and D centers as a center of excellence for TMI for, you know, for electromechanical, then for industrial automation etc. So the products will be rolled out from there which will be global and local. So a lot of groundwork has been created for future. So I’ll just list some of the upcoming launches which will Be coming very soon. These are few of the things which are coming out of that.
One is Solar Uno. This is single phase inverter. This is rolled out. This will be rolled out of R D from Richard and in Q1FY26 we are, we are expecting this to be rolling out. Then we also are coming with next generation of mid range inverter Solar inverters Neo. So this will also be coming out of R and D from Rishabh. Then medium voltage current transformer and potential transformers will be rolled out. In next one be coming from Electromechanical RD of Rishabh. Then full class Advanced, full class A power quality analyzer. Very few people, very few companies in the world who manufacture this.
And this will be coming out of Lumel R and D. We call this product as ND50. This is expected by end of this financial year. Then we also have this chip which is a medium voltage protection relay. Again a very high end product. Very few companies in the world manufacture this. So we are coming up with the next version, next revision of this chip 5 and for this project we have got this. For the innovation of this project we have got this grant for from European Union. Then we are also coming up with the next generation of test and measurement instruments from V and A China both in electrical side and environmental side.
And this VNDA China and Mumbai R and D work in tandem to roll out the TMI products which are coming from China as well as from Rishabh in India. And there are some strategic product developments which you have done. Energy Meter With Lora Communication we are introducing these energy meters equipped with LORA wireless communication technology designed to enhance, you know, remote metering capabilities. This integrates facilities, seamless data and transmission over long distance, ensuring efficient energy measurement. USA is the target market for this. LORA is absolutely an interpolation in our industry and we are one of the early adopters of that.
So we are really, really pumped up with this new innovation. And this also is going to boost our growth which we are projecting in the US market. Second one is GIN meters. These are a new range of meters which are available in three variants. 1U, 2U and 4U call them AS and these are for the European market. They are which enables them to be used as an energy meter in applications across Europe. And these are also very stringent standards which we went through. And these products are rolled out of Rishabh, Bindi R and D. So these developments underscore our dedication to advancing our product portfolio and reinforcing our position in the global market.
We are also pleased to report significant advancement in our R and D initiatives this year, underscoring our commitment to innovation and long term growth. In summary, we are steadfastly advancing across all facets of our business. As I said in all the three areas, whether it is product development, capacity enhancement or the conference is no longer being recorded. To foster growth and fortify resilience persist in our external environment, we are confident that most challenging phase is behind us. Our focus has now shifted from navigating headwind to capitalizing on emerging opportunities, be it through market recovery or operational advancement or strategic initiatives.
So we remain committed to sustainable growth driven by innovation, robust execution and leadership. Team. With the solid foundations we have established and momentum we are beginning to witness, we are optimistic about the long term prospects of Rishabh Instruments. With this, I would like to hand over to Vishal Kulkarni, our CFO to delve into financial performance of the group. And I sincerely thank for your continued support. Thank you, Vishal. Hello.
Vishal Kulkarni — Chief Financial Officer
Hello. Am I audible, sir?
Dinesh Musalekar — Whole Time Director
Yeah. Yeah, now you’re audible.
Vishal Kulkarni — Chief Financial Officer
Okay, sir. Yeah. Thank you sir for the detailed overview. Good evening everybody. Let me just give a brief snapshot on the financial performances on the standalone Rishabh India for the Q4FY25 and financial year 25. The revenue for Q4FY25 stood at INR 684 million compared to INR 591 million in the same period last year. So this has registered a year on year growth of 15.8% for the full year FY25. The revenue has been grew by 6.5% year on year reaching to INR 2,392 million. On the adjusted EBITDA front, the Q4 FY25. The adjusted EBITDA 149 million reflecting a year on year growth of 8.6%.
For the full year, adjusted EBITDA was INR 403 million which shows a decline of 21% year on year. Here. I just want to note that adjusted EBITDA includes esop expense of INR 9 million for quarter and 53 million for the year. On the EBITDA margins front, the adjusted ebitda margins were 21.8% for Q4FY25 and 16.8% for the full year FY25. At the PAT level, we stood at INR89 million for the quarter FY25 marking a year on year growth of 109.7% for full year FY25. That was INR234 million representing a decline of 27.8% year on year. On the consolidated fronts for the quarter and Financial ease, the Revenue stood at INR 1005 million for the quarter reflecting a year on year growth of 5%.
For the full year FY25 revenue reach at INR 7203 million marking a 4% year on year increase. The adjusted EBITDA for Q4FY25 was INR 221 million compared to INR 233 million in Q4FY24 showing a decline of 5.1% year on year. For the full year FY25 the adjusted EBITDA stood at INR 640 million down by 33% year on year from INR 955 million last year. Here I just want to make a note that Adjusted EBITDA for Q4FY25 includes ESOP expense of INR20 million and a withholding tax provision of INR40 million for the full year. The ESOP cost is 116 million, whereas the similar withholding tax provision of INR 40 million.
On the margins front, the adjusted EBITDA margins were 11.8% for quarter and 8.9% for full year FY25. The decline in gross margin and EBITDA margins during the quarter and full year was primarily due to change in product mix and headwinds in the Lumen Alugas business. Notably, the die casting division which accounts for 36% of the consolidated revenue operated at breakeven EBITDA, thereby impacting overall profitability. The profit after tax for quarter four FY25 stood at INR 62 million representing a year on year growth of 163% with PAT margins improving by 200 basis points to 3.3%. For the full year PAT was INR 212 million, a 47% year on year decline with PAT margins at 2.9%.
For the Lumen sample our electronics business in Poland, the Revenue stood at INR 431 million showing a modest year on year growth of 0.6%. The EBITDA grew significantly by 74.2% year on year reaching INR 99 million compared to INR 57 million. In Q4FY24. EBITDA margins improved sharply by 971 basis points reaching 23% reflecting improved operating efficiency. The profit after tax stood at INR 73 million a year on year increase of 108.9% indicating strong bottom line growth for the full year FY 2425, the revenue stood at INR 1989 million, registering a solid year on year growth of 14% driven by steady demand for automation and energy efficient solutions across key European markets.
EBITDA for the year was INR 405 million, up by 22.3% year on year, supported by operational leverage and cost efficiencies. The ebitda margins expanded by 138 basis points reaching to 20.4%. PAT came in at INR 350 million, marking a strong YoY growth of 47.5% compared to INR 238 million in FY24. For the diecasting business, our revenue stood at INR 7 million, reflecting a year on year decline of 1.8%. Adjusted EBITDA was marginally positive at INR 2 million with breakeven margins of 0.2% indicating early signs of stabilization. Net loss for the quarter was INR 50 million, primarily due to continued challenges in the automotive segment.
For the full year FY25, the revenue for the year declined by 2.7% year on year reaching to INR 2,636 million. The adjusted EBITDA was negative at INR 150 million, reflecting ongoing market pressure and subdued volumes. Net loss for the financial year FY25 stood at INR 252 million, underscoring the impact of strategic downsizing and restructuring efforts within the business. On the consolidated level, we remain net debt free with a strong balance sheet. The net cash and cash equivalents as at 31st March 2025 stand at INR10.22 million. A healthy cash flow from operations is INR650 million. With this, I shall now leave the floor open for Q and A.
Thank you.
Questions and Answers:
operator
Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press star N1 on their touchstone telephone. If you wish to remove yourself from the question queue, you may press STAR and two participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question. The first question is from the line of Pratik Giri from SHUB Lab Research. Please proceed.
Prateek Giri
Sir, am I audible?
Narendra Joharimal Goliya
Yeah.
Prateek Giri
Hi. Greetings everyone. Thank you for taking my question. My first question is on the EBITDA mathematics which we have been, you know, alluding to. So if I look at 113 crore of revenue in electronics business where we are seeing around 20% EBITDA so it gives us around 22 crore of EBITDA. Whereas we are seeing the aluminum by casting business is also not made losses probably some.2% EBITDA. But if you look at the console because.
Dinesh Musalekar
That is for the last quarter only if you are comparing quarter to you know in in if you are comparing the whole whole year and 0.2 was for the quarter so 0.2% EBITDA for Lumel Allocas falls for the quarter. So before that we had negative EBITDA percentages and now this is with all the actions we have done we we will cross that zero and now we have to build positive from there.
Prateek Giri
Mr. I’m sorry to press again on this but I’m talking about the quarterly number itself 113 crore. The renewing electronics business where we are seeing 20% EBIT margin with case of around 22 crore of whereas our control EBIT is only 16 crore. I mean we can address for the use of charges but give 16cr only. So it’s not adding up what I’m. Saying.
Dinesh Musalekar
20% is only for Lunel SA business which is the bit. I mean maybe I would leave our finance guys to explain you better.
Vishal Kulkarni
Maybe yeah the 20% EBITDA is for the electronic business basically for the full year the since there are losses for the in the die casting business that’s why the consolidated EBIT has been gone down.
Prateek Giri
I’ll take it offline. I think. I have second question on the economics business again you know the growth for this quarterly needed so anything to read in between. I mean is there any pressure you are feeling because if you look at the entire electrical infra and the company related to the infra has posted good growth in the quarter so and why.
Dinesh Musalekar
Electron is quarter to quarter you are talking because there’s lot of people in what you are saying. So I just want to be sure about the question. Are you talking about electronics business quarter to quarter supply?
Prateek Giri
I am talking year on year only last quarter FY24 and in Q4 FY24 we did 107 crore of revenue and this quarter we did 113. So I mean this is a 5% growth.
Dinesh Musalekar
Yeah. So I’ll tell you there are two. The electronics business for us comes from two big buckets. One is Rishabh India and the other one is Lumel SA in Poland. So Poland if you are comparing quarter to quarter or year to year on the top line it was flattish so it was not a big growth. But whereas Rishabh India we had more than 15% growth on top line stemming out of a lot of domestic sales both year on year and quarter to quarter basis. So to summarize that in the electronics business, you know like there are like 1/3, 1/3, 1/3 of the business, you can say more or less 30, 30, 30% and rest is all about 10% of the business.
So 30% of the business of our total group and about 50% of our electronics business is from Rishabh India which had 15% growth quarter to quarter as well as year to year in the last quarter. Whereas the Lunel SA which is 50% of our electronics business around or 1/3 of our overall 30% of our overall group business was more flattish. But if you look at the overall yearly performance for the whole consolidated year, Lumel SA was 14% compared to last year. As of end of quarter three, we were running 20% more than last year. YTD as of end of Q3 in Lumelis we were in excess of 20%.
But the last quarter we are flat like last year. So that 20% growth we are expecting brought down to 15, 14, 15%. But we still, with modification of our 20% growth top line to 15% we still achieved our EBITDA targets in VIMLA because the margins are really good. And 20% we did. And that is only temporary because of, you know, slowdown which is happening after the Trump and war situation and all those things. Then some projects are going slow. But that’s nothing to worry. It’s just, you know, one quarter thing and we will get back to the kind of 15% growth again.
Prateek Giri
This one. Follow up on this. Mr. Musiko. So you’re saying the European electronics business is facing some challenges. Is that understanding correct?
Dinesh Musalekar
You know, generally in Europe there is a growth challenge for every business, including electronics. But since my speech and what we discussed, we are not only banking on our, you know, organic growth, we are doing a lot of things like solar installations, we carry out, we do EMS businesses and you know, giving complete automation solutions. So we are doing a lot of those projects by which we are still having a growth. If you compare the companies which are in our kind of environment, electronic businesses also, they are either flat or they have dropped at least by 10 to 15% whereas we have registered 15% growth.
So we are doing a lot of other things other than just depending on organic growth on the electronic business. So I don’t see any challenges on that. So it is, it is, you know, like we still will have double digit growth this year. But it’s not with what we are doing. So we keep on doing other things other than our organic customers and products.
Prateek Giri
Just one last question from my side. Your confidence on eliminating diecasting turnaround since seems more this quarter. So is the problem going to persist longer than we are anticipated? Or I mean, is the turnaround strategy exactly on the path as we have anticipated last quarter or probably last to last quarter?
Dinesh Musalekar
I would say more or less. But I also want to be very open and very candid that there are challenges still open. So I’ll tell you what. We spoke about this in few quarters. So we had in aluminum die casting business. Half of the business was connected with automotive industry. And it was. There was a big turmoil. Everybody is closing down or shutting down. And in a vicinity of 50 km from here, there are three die casting plants which are closed down. It’s a fact, it’s a reality. If you are in touch with auto industry, what is happening in Europe, Big, small, all companies are suffering.
So we didn’t want to get affected. As a strategy, we also had about 50% non automotive companies which also had helped us during pandemic Covid period. So we didn’t suffer like other companies. But having said that, we had the strategy to go back to our customers and meet with them and have some price corrections and continue with the business. So when we took up this with two large, you know, automotive customers, they were reluctant because they tried to pass on this cost to their customers which were not ready. So they had option of either, you know, because they were all watertight contracts.
We could not be flexible. So there was a lot of, lot of pressure on closing that we thought that we’ll close them in three months time. They took six to nine months to have an agreement to close the contract. So amicably we have done so what we have done is we have said them, okay, you have one year, you relocate your projects wherever you want to take it. If you want to supply for one year, give us price correction. So they have given. So that’s where we have got this positive thing now. This one year period which we have.
We are very, very aggressively going into the market to find out, you know, projects to launch non automotive customers. And launch of projects in die casting takes, you know, about one year. So this is the transition which will happen. So one customer we agreed, the second one partially we had this price correction also. Wherever we agreed to continue supply. We see again drop coming in the where we did the price corrections and we had agreement to supply for long term. There’s a volumes are decreasing because of all the turbulence which is going on. For example, they wanted to pick up 6,000 parts a week.
They said that from next week it’s going to be 3,000 parts a week. So to summarize all of that, we have strategically decided not to have more than 20, 25%. But we cannot walk away from that quickly. So we are doing price corrections, we are hunting for new projects non automotive and we are doing that. One upside and opportunity in all this, all this risk that we have is we have a similar situation with lot of automotive, I mean die casting manufacturers. So they are closing down. So there is a consolidation of suppliers which is going to happen and we want to be part of that.
If we sustain for some more time, which you are doing. And after that some of these supply chain will shift to China or Asia and some of it will come to Europe also. And if we stay strong it will come and then, and then when it is coming we can be very choosy on the terms and condition and which industry what we want to take. So this is a work in progress which is happening now.
Prateek Giri
I’ll end that with you. Thank you.
operator
Thank you. Before I take the next question, I would like to remind participants that you may press Star in one to ask a question. The next question is from the line of Tanesha from Dam Capital. Please proceed.
Tanay Shah
Yeah, hi sir.
operator
Mr. Tanay, could you please come closer to your device while asking a question?
Tanay Shah
Yeah, I’m audible now.
Narendra Joharimal Goliya
Very low.
Tanay Shah
Can you hear me?
Dinesh Musalekar
Yeah, now it’s better.
Tanay Shah
Okay, perfect. So I just wanted to understand, you know, we’re speaking about a recovery in the Alucas business and we already spoke about how we’ve kind of negotiated contracts as well with our customers. How do we see demand shaping up going forward into FY26 given we spoke about the potential tariffs from us, the overall auto slowdown of exports to us. So you know, how do we expect volumes to grow to our vendors and at the same time how do we expect to kind of turn around our profitability in the Alucas business and any sort of visibility on that given that you decided some contract negotiations with your customer.
So that’s my first question.
Dinesh Musalekar
Yeah, so I will answer that in two ports. One is we have this 50% auto and 50% non auto business. So non auto business, which is, which is not having those turbulences and challenges on profitability. That is something which we want to grow with some organic growth we can expect 4, 5%, not more. That’s one part so 50% of our business is intact. Now what we are trying to do is to go to these customers and for our other customers where we may be one of the many suppliers because they also manage dependency and capacity etc.
We are going to these customers and telling yes, Mr. Customer, we have decided to go out of auto industry. So we have capacity. Can I get more? And they are having some challenges from their other suppliers and we are getting some business like that. We had some success stories already coming in the last quarter. But it will take time to launch this project. Six months to one year, which I said. So this is one activity which you are doing. Second thing is we are going to absolutely new customers. We have a big customer base, about 20 giant groups like we are talking about.
Simeon, CBB, Endosauzer, these are kind of Danforth. These are our customers. So we’re going to them and trying to where we are registered, we have been supplying for decades, many decades. So we are trying to increase. These are all non automotive customers. So this is one aspect which we have. Second thing is we are going to some industries like light industry or electrical industry where aluminum die casting is used to you know how these new customers, they will audit, they will go through this process of six months and after that you quote. And then by launching the project it will take about another six months or one year period.
So this is something which you are working on. The third thing is with the auto industry. So we still want to do business with them. As long as the contracts are flexible. What we are saying them is okay, you want to supply, then here is our proposal. So we agree on the price and material of course is passed on to them. Material fluctuation, energy. We have found a formula that we have any energy cost going up and down, we will do it. Inflation, we can do it. We want to limit the liabilities to the extent of what we have in our insurance policy.
Not to expose ourselves unlimited. So all these terms and conditions are there. And then we want to secure some margin. And then we want to go to these customers and naturally we are reducing with them and some will want to work with us. So that’s the overall strategy which we have. And in spite of a lot of supply chain shifting to in auto industry shifting to China. There is also because of the distance that we have. If you have what we have seen that in the past also there was supply chain from China and then when they had quality issues, delivery issues, then they all started focusing on European development.
Now with Chinese cars coming at a Much lower price. And EV launched in Europe want to compete with Chinese EV cars which are very aggressively priced and also good in quality. So they have no option but to depend on the EV supply chain from China. At the same time, policymakers in Europe also realize and understand that there’s a lot of talks which are going on. So they want to go slow on green implementation because that has created a lot of unemployment in the country. And there’s a big debate happening in European Parliament and every country’s parliament, so they can go slow on that.
Here people are happy to buy non EV cars, combustion engine cars all the time. The only thing is the EV cars when they are trying to make, they are almost two times more expensive for the same range of cars. So nobody is buying them. And Chinese can supply at the same price which the combustion engine cars are being manufactured and supplied in Europe. So this is where the difference is coming. Now the EU regulations don’t allow car manufacturers to produce more than X number of non EV cars, otherwise they are penalized heavily. This is all driven by the policies with Trump coming into picture with all these tariffs, etc.
So the European political group is seriously thinking about rolling back all those EV policies or green policies which they had because they’re having companies closing down, people being unemployed and this may roll back and if that rollback is another opportunity for companies like us. So we still are in a kind of uncertainty, but whatever is in our control we are able to do. We are trying to negotiate with the contracts, we are changing our portfolio, all that we are doing. So what will come out of this, these policymakers is it could be a bonus after it happens, if it happens in favor of industries.
Tanay Shah
Sure, sir. And this is a question to Vishal, what would the EBITDA for the die casting business be for FY25? We did mention that we were almost on break even basis, but if you could give me the exact number please.
Dinesh Musalekar
For the full year The EBITDA is minus 3.7.
Tanay Shah
Minus 3.7 million.
Dinesh Musalekar
No, minus 150 million for the full year.
Tanay Shah
Sure. Another question coming back to the piece which is fairly resilient, which is the electronics business in India, the electrical business in India and Luminance, could you highlight how that performance has been and you know, what is the outlook going forward? And also you emphasized on the EMS piece in your opening remarks, if you could kind of even throw some color out there in terms of what are we doing in terms of EMS business as we had largely begun only for captive and now what different are we doing out there? Yeah, that’s it. Thank you.
Dinesh Musalekar
So on the EMS business, one is capacity expansion which we did, we have installed two state of the art SMT lines. One in, you know, in Nashik and one in Poland. So for example, in Nashik we had a couple of customers where we are doing this as a additional business apart from whatever capacity we had, apart from what we make for our own products. Now we want to do this strategically so we wanted to start at a high end. So rather than making simple electronics where there is a lot of competition obviously, so we want to, we have started making.
Our line is capable of making PCBs for laptops, which is one of the very dense electronic component with 16 layers of, you know, PCB and many, many controllers and IGBTs which you call them as. So with that kind of a precision, we did a pilot batch of 200 parts after this new essentialize was installed and all 200 were successfully done. So technical capability we have proved now we have to take it with, you know, the box builders which are basically buying from China now. So there’s a shift of those supply chain from there to here.
We have to start. This is work in progress. This is big. So if we have this business and one whole SMT line, three shifts can be dedicated to one business and the volumes will be high. Obviously margins are thin on this kind of business. We don’t enjoy 50, 60% gross margin like we have on our products, but it’s a volume business with you know, maybe 20, 25% gross margin. So the challenge is you again will be competing against China. So this is something which we are pretty sure we can do it because the same whether it is in China or here or in Japan or Europe.
So the, you know, we call this as components per hour. So this new line which we have can do 1,180,000 components per hour. So compare that with our two lines which we have before put together could do, you know, 96,000 components per hour. So we are talking about align with such a capacity and precision. So the BGAs which are, you know, microchips which we have with multiple legs which are very, very fine. And so it’s just on the technology side it’s really high end. So we can have this business as an ongoing business. This is one change which we have.
And then in EMS business in Poland we have some products like we call them like Ono, which is used for, you know, it’s a co driver. You can find this product on Amazon. Also we make 2 million 1 million of them every year. So this is entirely done for their band and we supply that right from PCB manufacturing to component assembly, boxes, everything. So that’s been happening for some time. So we can see the growth in Lumel SA is also on account of that we increased our EMS business 100% in Lumel SA business. So this will continue.
So it’s going to be a mix of our product high end with good margin and also we want to keep our capacity busy with low margin high volume business. So it evens out. And apart from that we have project businesses which will be coming out of tender and some projects so they are like, they come like in spikes so it evens out. So because the share market looks at things quarter by quarter. So we try to have at least one spike coming in every quarter makes a difference in electronic business.
operator
It seems like the participants.
Tanay Shah
Got that sir, Got that. Thank you. Thank you so much.
operator
Yeah, thank you. The next question is from the line of Avinash Financial Services. Please proceed.
Avinash Nahata
Yeah, thank you for the opportunity. Am I audible?
Narendra Joharimal Goliya
Yes, clearly.
Avinash Nahata
Okay, so I have couple of questions to start with the first on the diecast business. So what is our cost structure in the Poland as far as this diecast business is considered? So what is our fixed cost and at what capacity utilization we do break even. So whether we are doing automotive or non automotive tonnage, at what capacity utilization we break even and what is the fixed cost structure over here. Thank you.
Dinesh Musalekar
Yeah, I. I would like to answer that question more in revenue than tonnage because tonnage is useful to measure when you are doing the casting and supplying. Because we have 20 processes in die casting business after casting we do elements etc. Etc. So you know our revenue if it is around at the current cost base and current margin levels which we have currently. I can talk from the last quarter’s experience. So monthly if our sales revenue are in the tune of 8 and a half 9 million Zwatis which is like 16 to 17 crores monthly, we are breakeven.
So this is with the current margin structure and cost base which we have. So our efforts are to get this to around 20 post monthly with a similar cost base and do that if our sales drop below 7 or 6 million dollars which is around that because it’s also bit complex. Cost of quality and a lot of other things come into picture. So I’m giving you a ballpark figure. So if it drops to you know like 12 to say 14 crores. 13. 14 crores monthly then you will be having the overhead Cost and GND cost eating into it.
So this is kind of a pivotal point. So I’m very mindful of that. And we are driving around that with some. Keeping some safe distance.
Avinash Nahata
So when I meant the fixed cost structure, which means that even if we don’t do anything, it will be 10 crores a month.
Dinesh Musalekar
Okay. Yeah, yeah, yeah, yeah, yeah, yeah. So Anand. Yes. Yeah. Would you like to answer that question? We are talking about monthly fixed cost.
Avinash Nahata
So I mean it is. I mean conceptually if we don’t have contracts which are profitable and we choose not to do it. So what is our fixed cost at Poland Diecast business.
Dinesh Musalekar
Yeah. So you know
Anand Takar
sir, you were seeing something.
Narendra Joharimal Goliya
Do you want to answer that question?
Anand Takar
The moment he asked the call drop. So I just was trying to connect.
Dinesh Musalekar
Okay, I will repeat the question. The question is, you know, what is the monthly fixed cost for Lumel Alucard? So if we drop all the non profitable businesses, what would be the break even? I try to answer that in a different way and there’s a follow up question. So maybe you can, you can try to answer that in numbers.
Anand Takar
The monthly cost of the monthly fixed cost for Lumel Holocaust is 1.5 million PLN and with 18% gross margin. Hello.
Avinash Nahata
Yeah.
Anand Takar
The monthly fixed cost is 1.5 million PLN, and with 18% gross margin. We need a turnover of roughly 8.8-½-million.
Dinesh Musalekar
Yeah, that. That’s what I was saying until
Avinash Nahata
you mentioned it. 9 million per month.
Dinesh Musalekar
Yeah, that’s the target.
Avinash Nahata
Yeah, yeah.
Dinesh Musalekar
So around. Around eight is. Is also. It is. It is not as straightforward as you know, Anand said that this is the fixed cost because you have got a lot of other dimensions to that. The cost of quality, the production stabilization, extra transport. Then your labor availability, whether you work in first shift, second shift, third shift or the weekends. Lot of factors come into that. So there’s a kind of a buffer for that. So you know, I think when we reach around 7 million Zworties monthly we have a problem. So which is like 14 crores turnover.
Avinash Nahata
Understood. Okay. And. There was a recent reset. I don’t remember when exactly. The base wages. So our wages would be how much higher than the base wages which are required by the state.
Dinesh Musalekar
The wages in the. In this last year the basic minimum wages were to be corrected about 78%. That was what was there, but only about. I would say 5% of our employees were affected and we corrected only for those in Lumela Lukas business in Lumel essay. Of course we have better profits and we want to have that. So I would. It’s again here the minimum wages is standard for the white collar, blue collar and everything. So what really matters? Again, there are so many skill grades there. So I don’t know how to answer that. How if I take a average that will be much higher than the base level.
Because you have got that base level is the entry level for people at you know, semi skilled kind of this thing. So what happens is when that goes up by 20% like it happened in the past 20, 30%. Then these basic wage people come to a skilled people’s level and then skilled people, they everything pushes up. So it may not have 20% effect on the overall organization but it will have like 10, 12% effect on the organization. This is what happened for two years when 20% plus base wage division was done two times.
Avinash Nahata
Right. So basically whatever minimum base wages has been revised last year. So the current quarter wages captures that. And you are saying that only 5, 6% of your overall entry level employees were affected, which has been reset, correct?
Dinesh Musalekar
Yes, that has been done. And you know the wage correction here is also they have a block for next five years. How the policymakers have done it. They have connected this with inflation. There is a formula. So when the inflation here was 15, 17% then you top it up 15 plus 5. So like 20%, something like that. So this was driven. Now the inflation in Europe is in control. So it’s in you know like 4 or 5% around that it’s fluctuating. So this is a stable situation at the moment on the wages.
Avinash Nahata
Okay. And this you said for the full year the loss was 3.7 crore for elude diecast business. Correct. FY25 full year EBITDA loss was 3.7 crores.
Anand Takar
5.7%. 5.7%.
Avinash Nahata
I am talking about absolute, absolute EBITDA loss 150 million. And. And the net loss was 25 crores. Is it right?
Anand Takar
Right.
Avinash Nahata
Okay, 15 becomes 25 because of some depreciation.
Anand Takar
Yeah.
Avinash Nahata
Hello.
Dinesh Musalekar
Yeah, provision plus. Provision was done.
Avinash Nahata
Okay.
Dinesh Musalekar
Which is subjudiciary.
Avinash Nahata
Yeah, so I heard that. Okay. So coming to the electronics business. So if I heard it correctly, you said 1/3. 30% each is the three pieces and 10% is rest. So India business is 240 crores. FI 25. I mean ballpark and Lumen essay. Essay would be 230 crores.
Dinesh Musalekar
200 crores. It was around 200 crores.
Anand Takar
Right.
Avinash Nahata
So 200 Lumal F in India was 240 around.
Dinesh Musalekar
Yeah, yeah, see Lumel essay. 200 crores with 20% EBITDA. So you can say 40 crores there on if you are calculating EBITDA and Rishabh is around 16% EBITDA on 240 crores. So again it comes around the same. And then we lost money in you know in Lumel Aloka, 15 crores. So this is how the equation is for the next year. If we increase these two businesses which are damn sure for 15 to 20% on Lumel essay and this one with around 15 to 20% EBITDA so we can generate about 100 crore of EBITDA. This is quite achievable possible.
And only thing is even if we arrest Limel Alucas from not making any losses so we should have a good year ahead. This is the summary. So that’s what we are targeting at the moment.
Avinash Nahata
Okay so based on the new SMT lines so what is the business expectation? Like you mentioned 15 to 20% increase in electronics business which is India and Lumel SA. So what is the expectation on the India business?
Dinesh Musalekar
India business, Rishabh business. The expectation for domestic is about 20%. Domestic I’m saying which is 50% of Rishabh’s business. Export I would say about 12, 13% because of what is going on in Europe etc. And Lunel SA business I would say about 15 to around 15, 14, 15%. Again based on what is going around even though we did 20% last two years and this year we did 15% even those three quarters we did 20%. Conservatively we can take 15% for Lumel SA for the next year.
Avinash Nahata
So on you are saying 20% for domestic India, Rishabh India and 12% for exports out of Rishabh India and 15% for Lumel SA. That’s the growth you are expecting?
Dinesh Musalekar
Absolutely.
Avinash Nahata
And any change in margin profile due to whatever interventions you are doing a new SMT line or it is going to be like that.
Dinesh Musalekar
Not, not much, not much because we are also introducing it’s a product because here the spread is too big and we have control on the selling prices. Our products are absolutely accepted in the market. Quality is good, delivery is good. So even if we increase 5%, 10% whenever it is needed on selected products we are still growing our revenue. So unlike, unlike aluminum die casting or even EMS business where you know you are in control of somebody else who is calculating your cost plus plus basis. The you know, substantial part of our electronic businesses, our design, our product, our manufacturing, our pricing strategy, our marketing strategy.
So we have much better control. And when your product Is good accepted in around the world for decades. So we are in bigger, better situation there.
Avinash Nahata
And what was the capex done for FY25 in India Lumel essay in the current year? And what is the capex you are targeting for the next year?
Dinesh Musalekar
The capex currently ongoing in, in Rishabh India which Mr. Kolya explained. So we are building two to buildings, it’s in the tune of about 50, 60 crores to increase our production capacity. So that, that is what is happening there. And in Lumel we are adding about, you know in Alukast we are not adding anything but in Lumel SA we are adding this SMT line which is also 40% supported by the innovation project. So we are adding say about, say you know, around 15, 20 crores in this thing. So about 60 plus 20. Around 70, 80 is the CapEx which you can expect on the top line for the next two years.
Avinash Nahata
Okay, understood. Thanks for all the queries and all the very best to the entire team.
Narendra Joharimal Goliya
Thank you.
Dinesh Musalekar
Thank you.
operator
Thank you. Due to time constraints, ladies and gentlemen, that was the last question for the day. I now hand the conference over to the management for closing comments. Over to you.
Dinesh Musalekar
I would, I would like to take this opportunity to thank all our investors who have, who have kept invested and had faith in the management team and in Mr. Narendra Golia’s vision. So I thank you everyone for this. And I would request Mr. Goliath to make his closing comments.
Narendra Joharimal Goliya
Yeah. Thank you Dinesh. See, we are very optimistic. This company has grown steadily over the last 30, 35 years. The Times are even now better. In spite of all the problems which people discuss. America and tariffs and Europe and auto industry and so many things. I am completely positive things will improve. We have some challenges in the aluminium. We will sort it out. Electronics has never been a challenge. Only thing is, can we make the growth faster? 12, 13, 14, 15%. We have always grown. But there are good years when we have grown more. Of course it is uncertainty in the market but it’s also the effort of our people.
They are all committed, all of them are experienced and they will come back to good growth. And I hope that the coming year will be much better than the current year we have shown. So let’s all work together and support our industry and our government to do things which are even better than what you have done in the past. Thank you.
Dinesh Musalekar
Thank you.
operator
On behalf of Dam Capital Advisors limited that concludes this conference. Thank you for joining us. And you may now disconnect your lines.