Syrma SGS Technology Limited (NSE: SYRMA) Q4 2025 Earnings Call dated May. 14, 2025
Corporate Participants:
Unidentified Speaker
Nikhil Gupta — Headof Investor Relations, Corporate Development & Initiatives
Jasbir S. Gujral — Managing Director
Satendra Singh — Chief Executive Officer
Bijay Agarwal — Chief Financial Officer
Jayesh Doshi — Director
Jayesh Doshi — Non-Executive Director
Charlene Chokshi — NA
Jayesh Gujarat — MD
Analysts:
Unidentified Participant
Indrajit Agarwal — Analyst
Aniruddha Joshi — Analyst
Sonali Sargaon — Analyst
Pranjal Jain — Analyst
Nair — Analyst
BBharat Shah — Analyst
Prav Shrivastav — Analyst
Mahesh Chawan — Analyst
Presentation:
operator
IT. Sa. The conference will start in a few minutes. Thank you for being connected. Ladies and gentlemen. Good day and welcome to the earnings conference call for Cirma SGS Technology Ltd. Hosted by JM Financial Institutional securities Ltd. 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 concludes. Should you need assistance during this conference call please signal an operator by pressing Star then zero on your touchstone phone. Please note that this conference is being recorded. I now hand the conference over to Mr.
Charlene Chokshi from JM Financial Institutional securities Ltd. Thank you. And over to you sir.
Charlene Chokshi — NA
Thank you Navya. Good morning everyone. On behalf of JM Financial we welcome you all to the Q4FY25 earnings call of Firma SGS. Today we have with us the senior management of Sidma sgs. I will now hand over the call to Nikhil to take the call forward. Thank you. And over to you Nikhil.
Nikhil Gupta — Headof Investor Relations, Corporate Development & Initiatives
Thank you Charlene. Hi. Very good morning to all. Welcome to Cirma IGS 24 and fiscal year 2025 earnings call. We have with us today Mr. Jayesh Gujarat Managing Director Mr. Jayesh Doshi, Director Mr. Satyendra Singh, Chief Executive Officer and Mr. Vijay Agrawal Chief Financial Officer Sirma SGS to discuss the performance of the company during the fourth quarter and financial year 2025 followed by a detailed question. And answer session during the call certain. Statements that will be made are forward looking which involve several risks, uncertainties, assumptions and other factors that can cause results to differ materially from those in such forward looking statements. All forward looking statements made herein are based on the information presently available to the management and the company does not undertake to update any forward looking statements that may be made during this call. In this regard we request please do review the disclaimer statement in the earnings release and all other factors that can cause the difference. With this I will now hand over. The call to Mr. JS Gujarat managing the results Sigma SGA thank you.
Jayesh Doshi — Non-Executive Director
Good morning everyone. A warm welcome to Therma SGS Q4 and FY25 earning call. I’ll delve on the broader picture, the business scenario and the macro level things affecting the company and the quarterly numbers and details will be dealt with by Vijay Agarwal in detail. We started off the year with a guidance of 7% of EBITDA which was at about 310 and 315 crores recalibrating of the business strategy to bring consumer business down to about 35% which also means accretion in the business high margin business of industrial, automotive and health care. As we close the year, we find that we have achieved the target set and communicated to everyone.
We have brought down the consumer business to 36% of all revenues. EBITDA expansion has been a bit healthy at 8.6% up almost 1.8% from FY24. As we look forward for the coming years, we are in line to grow the business at about 30 35% with consumer being retained at about 30%. So we further see a reduction in the consumer content from 35% to about 30% in the coming years. As a natural corollary, this would imply or this means that our superior margin business in the industrial, healthcare, automotive vertical would further go up which would help us in sustaining the EBITDA margins of about 8% in the coming years.
As we look back, we find that we have added about 2025 new customers in the current year which would go on stream this year and in FY 2627. We have commissioned our Pune facility. We have commissioned our facility in Germany, consolidating it into one location. This facility was acquired somewhere in June, July, August last year. We have started large format box build for customers, global customers which would accrue decent size of revenues in the coming years. We are fully on track in achieving the growth targets of about 30 35% which is backed by the orders in hand with a focus on high margin verticals.
Another issue which is of great satisfaction to us is that our ESG initiatives are on Track and EcoVadis which is a global agency which monitors ESG has given us a percentile score of plus 70% and we are among the top 35 companies globally which are meeting the ESG norms set by the companies and the government. Our leadership training program and induction of talent is almost complete now and we are fully poised to grow the business and be a forefront runner in the PMS space especially in the exports. Exports in the current year have been subdued.
We had guided a thousand crore export target. We have fallen short by about 200. We are about 800 plus. Largely driven by the tariff uncertainty is a muted EU curve environment. However, based on the guidance inputs received from our customers, we expect the exports to cross the 1000 crore mark. So we are delayed by a peer. We should have achieved it in FY25. We intend achieving it in FY26. We have generated a free cash flow of about 176 crore working capital. Net working capital at about 69 days work in progress scope of further reduction. So what gives us the satisfaction is that if we look back on four years sort of period, what do we see? Our revenues have grown by about 44% CAGR EBITDA 34% EBITDA 29%, exports 15% and mind you neither EU nor America is growing at that rate which clearly indicates onboarding of customers or drawing more business from the existing customers.
If I was to see the landscape of the vertical in the last four years my automotive segment has expanded by 57%, consumer by 60%, healthcare by 23% and industrial by 29%. FIC only for the last year FY25 over FY24 I have seen automotive increase of 26% a decline but only increase of about 7% in consumer in line with our target of bringing on the low margin high volume consumer business content. Healthcare has gone by 15%, industrials by about 29% and we believe that in the current year consumer will be about 30% of my revenue and remaining 70% will be industrial which should be about 30%.
Automotive about 25% healthcare and other things about 15 18% and the balance by railways and it’s with that I hand over to Vijay Agarwal to take you through the details and any questions which you have I’ll be more than happy to address them. Thanks Jasmin.
Bijay Agarwal — Chief Financial Officer
Good morning everyone. I will now take you through the brief financial performance of the company for the quarter and for the financial year FY25. I can start with the revenue here. Our consolidated total revenue for the quarter is 947 crore which has grown by 6% quarter and quarter and similarly the total revenue for the full year is about 333,836 crores that grew by 19% year on year as well as the previous year. The growth for the period is contributed largely by higher growth in the auto segment, industrial segment and IT businesses. Our export revenue for the quarter is about 280 crore rupees and for the full year it is around 860 crore rupees which is approximately 23% of my total operating revenue.
Our ODM revenue for the quarter for the full year also it is about 12%. The quarter we have shown good. Rebound in the margins led by expansion into the gross margin on the back of change in business mix mainly lower consumer as Mr. Bizral has explained better industrial business, higher health care business and and our continuous effort on operational efficiencies and stable overhead costs. Our gross margin for the quarter is about 37.8% and for the full year it is 32.6% with a healthy expansion of around 200bps. As against the gross margin of the previous year our operating EBITDA for the quarter stood at around 116 crore rupees which is year on year growth of approximately 39% and the operating EBITDA margin of 10.4%.
Similarly when we see the operating EBITDA for the full year IT is about 324 crore. With the operating EBITDA margin of 8.6% it has grown almost 48% over the previous year. Same way PBT for The quarter is 93 crore rupees with a PBT margin of 9.9% and for the full year it is 239 crores which is PBT margin of 6.2%. Our pack for the quarter is 72 crore rupees with a packed margin of 7.5% and for the full year it Is around 184 crores which is 4.8% of packed margin for the full year. Coming to the overall working capital performance we are currently running at around 69 days of net working capital days of investment while we continue to make our effort to bring it down to below 60 days, maybe around 60, below 65 days, maybe around 60 days but we’ll be focusing on the same and targeting to bring those numbers in after New year.
Moving to our debt position we have a total gross debt of around 611 crores at the end of the year, largely working capital debt which is around 520 crores rupees and balance. 90 crore rupees is a term loan. We continue to hold a healthy treasury balance of approximately 347 crores here and with this our net debt position at the end of the year is 264 crores. Our cash flows operating cash flow for the year is 170 crores positive which is resulting into the OCF EBITDA of approximately around 54%. Coming to capex investment during the year we did almost 180 crores of capex largely towards greenfield expansion of our and some bit of downfield extension into Bawal and Chennai location mainly driven through new customers, onboarding and related tools and fixtures and pandemic in the installations.
Coming to asset turn and the returns we have achieved five and a half times of asset turn during the year and roc is around 16% on an adjusted basis we expect this to further improve as we set our assets as we improve our overall Asset utilization. Lastly, I would say we continue to focus on the high margin business verticals, operational efficiencies, overall cash flow improvement and thereby improving the return. We still continue to focus upon the working capital improvements and that’s all from our side. I would now hand over the call to Navya to take it forward.
operator
Thank you Vijay. I now will hand over the call to Mr. Satender, our chief Executive officer.
Satendra Singh — Chief Executive Officer
To his comments on the business. Thank you Nitin and good morning everyone. Thanks for joining the call. I think we have had a very good quarter as a company. First of all I’d like to say thanks to all the 9,000 plus people we are employing in the company who work day in and day out all over the year and the quarter to bring us the results which we have reported to you a few minutes ago. Overall, I think we continue to stay focused on the strategy which we have always outlined consistently as a company. We are looking at the businesses which are medium volume and higher margin.
Essentially we continue to focus on automotive, industrial, medical, railways. These are some of the segments where we continue to focus on. Accordingly, the business mix will evolve as we already highlighted that consumer business will shift slightly down as a percentage. However, all our businesses will continue to grow. We have taken many steps to improve our operating efficiency, to improve our procurement efficiency, to ensure that we sweat our assets. As Vijay highlighted in his comments, that’s key of EMS business. At the same time it’s not lost on us to ensure that we have enough capacity available.
We will continue to invest as and when it is needed. At this point we are looking, we are evaluating our footprint and we are expanding our Bangalore facility, marginal expansion to ensure that we are able to serve our increased business in Bangalore. Overall, I think we stay focused and we look forward to results as in line with what Mr. Gujarat highlighted. Thank you very much. Back to you, Nikhil Navya. Thank you. Sadhand and Navya, you can help us on the Q and A session. Thank you.
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 touchtone phone. If you wish to remove yourself from the question queue, you may press Star in two. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Indrajit Agarwal from clsa. Please go ahead.
Questions and Answers:
Indrajit Agarwal
Hi. Thank you for the opportunity. I have three questions. First, if you can elaborate a little bit more on what is Troubling our consumer business? Which product segment and how is the current run rate in terms of exit?
Jayesh Doshi
How do you look at it? Sorry, could you please repeat the question again, it was not very clear.
Indrajit Agarwal
Yeah. So what exactly is troubling our consumer business and how is the exit run rate versus what we have achieved for the full year?
Jayesh Doshi
See, there’s nothing troubling in the consumer business. We have always shared that the consumer the high volume low margin consumer business is one of the low hanging fruits which we had picked up. But with a conscious focus on concentrating on our core competencies which is engineering, design, lit manufacturing, which is more into industrial healthcare segments. So there was a very cautious call of the management to recalibrate its focus on the high margin segments. And as I’ve already shared, there are no free lunches when you concentrate on high margin verticals which have a lot of engineering design content.
The natural casualty is the top line. So it’s a call which the management has taken to have accretive Ebitdas from superior verticals. So on the exit run rate we have done around 190 crores of consumer revenue in the quarter four which is around 21% while for the full year it is around 35%. The only clarification here is this is not like evenly distributed kind of a thing. The schedules come into 1/4 probably much higher number and 1/4 much lower number that way. So from we should consider a full year revenue rather than a shortage. I have always been maintaining that we should not look businesses on a quarter on quarter basis. If you recall Q1 the consumer business constituted 54% of our revenues. Q4 it constitutes about 20% of our revenues but on a blended basis it has come down to 35% this year. And we further intend to take it down on an end like basis to 30% in the coming year. Q on queue. There could be variations. Sure.
Indrajit Agarwal
Thank you. On that note, while we are looking at full year numbers, our consumer business will go down further in terms of mix from 35 to 30. So what would drive the EBITDA margin decline from 8.6 to 8 as you.
Jayesh Doshi
Have guided for FY26 see we have guided 7%. We have delivered 8.6 or 8.5 whatever is that we are guiding 8% which is almost a 15% increase on 7% as the quarters pass by. If we believe and we are confident to achieve a EBITDA of higher than 8% we would share with that. Currently on a conservative basis we guide 8% EBITDA margin we guided 7% last year and we are now guiding 8%. Also when we see there’s a consumer business coming down to 30% but simultaneously maybe it plus automotive business will also increase slight a bit higher in this overall mix and based on the weighted average mix only, we are guiding about 8%.
Indrajit Agarwal
Sure. A couple of housekeeping questions. One, both receivable and payable days have increased. So what is driving this sharp uptick? I understand the overall working capital is still under control of about 69, 70 days. But the mix has shifted.
Jayesh Doshi
So what is driving this Vijay will run through the fingers. You see in working capital, I think the quality of working capital is reflected by the lower inventories. So what we have achieved this year we have brought down our inventory level by about 18% to 822 crores. Down from about 1000 plus crores. Payables and receivables are commercial transactions which we as a strategy try to match off. So if my customers ask for extended terms of credit, what is under my control is have an efficient manufacturing and bring down the inventory level which we have done 18% this year.
We go back to our vendors and as our volumes increase we go back to our vendors for extended payment terms. So that’s a commercial balancing of receivables and payables. So this is the part and parcel of the business environment. What is critical is is my inventory under control or not? And then I’m happy to share. Our team has done a phenomenally good job of reducing inventory by about 19%. I hope that answers your.
Indrajit Agarwal
Yes it does. Lastly, if you can give us the order book numbers.
Jasbir S. Gujral
Vijay will take you through the numbers but on a macro level basis, whenever we guide the revenue it is based on the orders in and orders in pipeline and visibilities and everything. So order book is in line with what we have guided. But for the specific numbers, if you want, Vijay will share with you. He has the details, he can share with you. But broadly, I think our orders in hand are in line with the revenues guided. So we can derive the figure if you want it from Vijay, he can share it with you.
Jayesh Doshi
So broadly, as Mr. Gujral has explained, order book is in line with my revenue guidance. But still the overall order book is somewhere between 5200 to 5400 crores as of now which is as of 31st March 2025. And in this the breakup would be around 25 to 27% in auto related business, approximately 30%. Consumer business industrial would be around 28 to 30% and rest 15% is approximately between IT healthcare and railway business.
Indrajit Agarwal
Thank you so much. That’s all from my sleep.
operator
Thank you. Ladies and gentlemen, in order to ensure that the management is able to address questions from all participants, please limit your questions to one per participant. We will take the next question from the line of Aniruddha Joshi from ICICI Securities. Please go ahead.
Aniruddha Joshi
Hello. Can you hear me? Yes, please. Yeah, so thanks. Thanks for the opportunity. So, two questions. Should we consider the change in strategy towards consumer business as a perpetual thing means in a way it will be going forward the same approach. We will keep to have a relatively lower focus on consumer business and the margin focus will remain higher. So. So is that the strategy? Perpetual change in the strategy. Should we assume that point question number one and question number two is there is a material increase in the debtor days and largely it is attributable to higher margin business also. So will that also be in a permanent change in terms of the working capital numbers as well? That is the second question.
Yeah, that’s it from my side and thanks for the great set of numbers.
Jayesh Doshi
Okay, now as a strategy. Yes, we would concentrate on the high margin businesses, higher margin vertical more in the coming years. This year and coming years, high volume, very high volume, very low margin consumer business would be sort of slowly and steadily brought down to 30%. But this does not mean that the consumer segment sub vertical in the consumer sector, which is my own design and texture that will be a focus for the management. So when we say the overall consumer business has come down to 35% this year, it also includes my own design and manufacturing other products which I give to the consumer segment with a comparatively high margin.
The focus will be on higher margin business irrespective of the vertical. Consumer also has verticals within it which is decent margin business. It’s only the high volume low margin business which would in a structured way be brought down. Coming down to your working capital level. When we were at 40% consumer business, 5 of our consumer business we were at about 70 days. We have brought down the consumer business to 35% and we are down to 69%. So the focus of the management would be to control the working capital in its totality. Yes. When we do industrial, when we do export, when we go into railways, the working capital cycles are comparatively elongated.
But with efficient management of resources and production, I think we are in line to reduce the working capital further. Just for clarification, these are what the working capital figures are without any factoring or off balance. Sheet adjustments. Vijay will run through the details.
Bijay Agarwal
So you are right there, Anil. Primarily with the high margin business we may have to deploy certain high returns but that is all backed by high payables also because we negotiate the business accordingly and going forward we are further targeting to bring it down at receivers and payables level. In fact along with the overall reduction at the NWC level also.
Aniruddha Joshi
Okay, sure. So this is very helpful. The second line, last question. If you can indicate a bit more on the UIP plan and also the business that we are planning to start under new poly owned subsidiary. So what are the timelines where the new plant will be and in a way what are the incentives? State incentives and the incentives that we are looking at. And in a way if any customer details. Client details if you can share. So whatever business plan you can share at this stage. Yeah, thanks.
Jayesh Doshi
Is just a revalidation of the QIP with the provision the authority which were taken from the board board last year. So that was expiring in about whatever a couple of months. So we have taken re sanction from the board of a qip. This QIP would be used one if we do inorganic acquisition and that’s what we had shared last year. So it’s an enabling resolution to have sort of funding arrangements ready. Second, if we go and rather not if when we go into component manufacturing under the government of India component scheme which has recently been announced we’ll share with the street once we have something concrete.
It could be used for that. And then the remaining is the general purpose working capital and other things. As of date there is no fixed concrete proposal on the table to say this much is for this, this much is for that that will share once we have the details. I hope that answers your question.
Aniruddha Joshi
Yes sir, that is helpful. And any other details that you can share on the bare PCB business that we are looking at.
Jayesh Doshi
We are looking at components in totality and their PCB is part of what not there as of there’s nothing, no concrete proposal which has been approved by the board. We are evaluating various sort of. Piece. And piece parts which are in the component policy. ECB is part of that. But as of date there is nothing finalized or concrete on the table. We are evaluating and discussing and we’ll share with the seat once there is something concrete. Something once we have concluded.
Aniruddha Joshi
Okay, that’s. That’s fine sir. And I miss the revenue guidance that share for FY26. I understand margin was indicated around 8%. Yes. 30 35% growth with about 8% margin profile. Okay, sure sir.
Jayesh Doshi
Thank you.
operator
Thank you. We take the next question from the line of Sonali Sargaon from Jefferies. Please go ahead.
Sonali Sargaon
Thank you for the opportunity and congratulations on a great set of margin growth. So my first question is actually regarding the new component manufacturing scheme which is being ruled out by the government ECMs so tentatively as of now which would be the areas of interest for the management to apply and in that conjunction what would be the kind of CapEx that we would be looking forward in FY26 and 27.
Jayesh Doshi
Under the component policies we are evaluating components whether they are electromechanical wound components, there are something like camera modules, PCB is one of them. Connectors also are there. As of date there are three, four verticals which our teams are working seriously on and we are looking for tie ups and other things. Once we have then we’ll share. But broadly the component ecosystem has to be developed in India and we are very seriously evaluating that and I think we should be participating in the scheme. There’s still a window of about 80 odd days or 78 days till 31st of July to file the applications.
Again what we are very, very mindful of is that wherever we go in, whatever sort of component we go in, we must go with a very credible reputed technology partner. I think that’s the underlying philosophy of the management and the growth that we should have credible partners which are very well placed in the vertical. We would like to move on the capex. Again overall capex varies depending upon which component we select and maybe what, how much of the capacity we plan to put over there. Broadly we can see the CAPEX varies from maybe around 300, 400 crore to almost a thousand crore also.
Sonali Sargaon
Great. So this is very helpful. So my second question is regarding the exports. Now clearly we are one of the key players exporting two geographies across. So any thoughts on the US tariff? I know there is a 90 day pause but any thoughts therein or how the exports will shape up going forward?
Jayesh Doshi
See exports have been muted in FY25 as shared in my opening comments in FY26 based on the orders which we have and the guidance which we have received from our customers customers we would be able to cross the 1000 crore mark which will be, which will signify almost a 2022, 23% increase. Tariffs are still in a fluid and a nebulous stage. How would it pan out? No one knows. So despite that we are expecting a growth of about 2022 percent. I think we are working very closely with Our customers and other stakeholders and I think we’ll navigate once some semblance of clarity or stability emerges on it.
Sindhur, Anything like that. We have been in close discussion with. Our customers, meeting them in person as well as having regular touch points with them, closely following their strategy. And I think as of today the tariff is frozen. So once the administrations are making a decision on which direction they are taking, we will work closely with our customers to support them and their strategy. But clearly as Mr. Gujaral said, we see our exports growing this year compared to what we did in the last financial year. And just to add on to what Strengther is saying over judgment or assessment is that India would not be necessary negatively impacted by the tariffs. So I don’t see, we don’t see a situation where India has higher tariffs than the competitive countries. Tariffs will come but India would still have a headroom in that. I think India would be taxed at a comparatively lower tariff rate than the competitors competing countries. That’s over assessment.
Sonali Sargaon
Understood sir, Very clear. And just one last question from my side. We completely understand that you want to transition from the lower margin consumer business and yet grow our top line. So which would be the top two sectors who would contribute to the revenue more than the consumer? Would that be industrial and auto? Is this understanding correct?
Jayesh Doshi
Yes. Our major growth drivers are industrial and auto sectors along with the exports which we just talked about. So these three will be the major drivers for top line growth next year.
Sonali Sargaon
So would exports be margin operating as well?
Jayesh Doshi
Yeah, yeah they are.
Sonali Sargaon
Okay. So thank you and all the best to the team and congratulations once again.
Jayesh Doshi
Thank you.
operator
Thank you. We will take the next question from the line of Pranjal Jain from Morgan Stanley. Please go ahead.
Pranjal Jain
Thanks for taking my question. So you did mention in the opening remarks that we have added around 20 to 25 new customers which are likely to see some revenue booking from FY26 onwards. With that in context, which are these key segments that these new customers cater to? That’s number one. And which are the sub segments that. Are driving growth in industrials segment in. Particular. Majority of our customers are in automotive. If I would look at it, 3/4 of the customers are in between automotive and industrials. And that’s, that’s in line with our strategy and that’s where our focus major focus will be.
Jayesh Doshi
And on your question on the vertical sub vertical within the industrial segment. In domestic segment the industrial would be driven by the energy metering. Globally it would be power electronics, a large format box bin for various applications including EV charging and power supplies, utility metering globally also would be attraction growth traction in this year. So it’s a very broad wide mix. Automotive will be driven by primarily EV and creation of more customers in the ICT space. Sure.
Pranjal Jain
So that answers well. And secondly, what would be the incentive PLI incentive that we may have booked in the full year of FY25 approximately.
Jayesh Doshi
Around 35, 36 crore is what we have booked in for the full year. And could you also help us with. Q4 in specific about.
Jayesh Doshi
Sure.
Pranjal Jain
That answers my question. Thank you sir. Thank you. We take the next question from the line of Nair from DAM Capital. Please go ahead.
Nair
Yeah, good morning sir and congratulations on a good set of numbers. So my first question is Onik, I know you spoke about exports being a strong driver of growth next year and we were looking at us to kind of support that. But given the tariff situation, one is on a wait and watch out there. Could you throw some color in terms of how is Europe sales really going or other parts of the globe which is supporting our confidence in terms of the growth aspect out there. As we look at next year.
Jayesh Doshi
See two parts. One, my growth in the sales will be driven by some customers which saw 4, 5, 6 months window of revenue last year and I’ll see a 12 month window of revenue this year. So that is almost like 100% jump in the revenues from those customers. Because if I did a customer for five months and I do it for 12 months, there’s an incremental revenue. On Europe specifically it has been muted thus far. We have now seen a rebound, a slow rebound in order inflow which points that towards the end of this calendar year Europe we would see back to what we were there in 24.
See we have maintained 863 crores of revenue up from about 800 crores last year on the back of a very subdued demand from eu. So my customers, additional customers offsetted or compensated me for the decline in demand or revenues from the EU customers. We have now started seeing a upturn in this and the new customers which we onboarded and the orders which we we have got, the visibility which we have got gives us the confidence that if the things were to pan out as they are currently panning out, we should cross the 1,000 crore mark in the coming year.
It will also be aided by healthcare. Though healthcare business is small, but it will also be aided by healthcare business. This is again I given a caveat that if things pan out as they are, if tomorrow something out of the world was to happen on Paris or something which we none of us estimate then it would have a different impact. But under the normal circumstances we would achieve the thousand crore mark. And I shared you based on rebound in Europe, some customers which saw revenues kicking in in second half of FY25 having a full 12 month window and some new customers which we have added which would see some months of revenue this year.
All these three factors put together would sort of take us to cross the 1000 crore revenue mark. And we are very confident on that.
Nair
Sure, that helps. So my second question is on industrials. We’re looking at a very sharp growth out there and percentage contribution also kind of improving. A lot of the growth is also driven by the domestic segment where the energy meters will play a significant role. Now how large is this segment vertical for us? Are we seeing decent traction out here or are there delays in terms of execution on ground which could possibly impact into the second half? So just trying to understand this vertical out here.
Jayesh Doshi
Are you referring to the smart metering business or the industrial in general? Okay, yeah, smart metering business or I would call it utility metering business within the industrial is a significant component. And just as a reference point I was looking at the figures. We did about 3.9 or 4 million units of energy metering electronics in the year gone by and we expect that traction to continue in this year also. And this would be what growth in 25 and we are seeing 4 million, close to 4 million number in FY25. I think it will grow overall industrial as I shared earlier, over four year period it has grown by 29%. Incidentally last year also it has grown by about the same percentage. We expect this business to continue to grow. Now whether the smart metering business grows by 20% and gets the other components in the power thing, large boxer build format, build fuel dispensing, power supplies, power control, solar. So all these things put together we expect what Vijay had shared that we have targeted a growth of about 29, 30%, 30%, 30% plus in the industrial segment. So it will be a blended mix for FY25.
The similar utility metering business would be approximately 300 crore plus.
Nair
Okay, okay. But it’s a helpful lastly, you know on the, you know Bear PCB board business that we are looking to get into and evaluating would we kind of be doing this on our own? Are we planning to do some tech partnership? Any color on that business would really help on what trend on the BPCB business?
Jayesh Doshi
Again I said Bear PCB is part of the component policy. So let’s not be specific to bare pcb. Whatever vertical we enter, whether it is the bare PCB or the components, whether they are magnetic bound, if we believe that we have the in house capability to it, it will be done in house wherever we believe that having a partner would be worthwhile. So it will be with a partner. What concludes that association takes place? We’ll come to know once we sign off our agreement with the potential partner whether it’s a jv, financial, JV Technical jv.
So those are all things under discussion today but one thing is clear that we would be participating in the component pni. What particular things are still under discussion and I’m not at a liberty to sort of disclose and discuss them till they are finalized.
Nair
Sure sir. Sure sir. Great. This helps. Thank you very much and wish you all the best.
Jayesh Doshi
Thank you.
operator
Thank you. We take the next question from the line of Bharat Shah from Ask Investment Managers. Please go ahead.
BBharat Shah
Yeah, hearty congratulations Bazaar chapter. I just had a comment to offer then would like to have a response from you on that. I think our business model is now acquiring much more solid and concrete shape. Earlier perhaps the business was the turnover was an outcome of the order book and availability where growth of the top line seem to be number one priority. Now I think balancing the business with healthy profitability, capital efficiency, working capital management and carefully balancing overall business so that business becomes an outcome of the business model rather than the other way down.
Would you say that is a fair comment as to how we have evolved in let us say last two to three years?
Jayesh Doshi
Yes, if you just scan over the last two, three years for about a year, a year, year and a half we had a very high component of the low margin, high volume consumer business where we were not present earlier. So it was a new sort of dish for us and we are now recalibrating or rather we have recalibrated our strategy to refocus on our core competencies. The manufacturing of high volume consumers is also we have developed that core competency and we are comparable to the best in the industry today. But having said that we have recalibrated our strategy to focus on comparatively higher margin design engineering led manufacturing which was our core competency pre 22.
So you are right, we are refocusing that to focus on growth in these high verticals. And I said, as I said earlier Bharatji, there are no free lunches. If we have to focus on margin accretion, industrial, automotive, they have a certain growth trajectory unlike the consumer which is a low hanging Growth and could have a very high growth trajectory. So we’ll continue to concentrate on industrial, automotive, health care and design LED manufacturing which will have some impact on the top line but on the bottom line and other things it will be more. Positive.
BBharat Shah
And presumably greater focus on technology which is our own ODM business carefully chosen and selected and improved margin with a discipline on working capital. All that should lead to measurable improvement in capital efficiency.
Jayesh Doshi
Yes please. But these high margin businesses have an elongated working capital cycle as a nature. But I think with a proper focus and control and empower teams we should be able to maintain rather reduce the working capital cycle which you have thus far achieved which is about 69 days. Despite these high margin businesses going up which have a longer working capital capital cycle. I think we are in a position to bring down the working capital cycle further.
BBharat Shah
One question for Vijay Agarwal because the PLI likely will be coming here if there is any computation done.
Bijay Agarwal
This is all varying actually based on the overall how much of consumer and specifically telecom consumer business we are doing in the next year we can say based on the order book visibility this income can be somewhere ranging between 15 to 18 crore rupees for the next. Year also 15 to 18 crores for the company. 15 to 18 crore in entirety for the company. This is like what the company can retain for sharing. If there is anything this can reflect. The company going forward also as compared. To 35 crores booked in the FY25 you are saying about half of that number is likely for the company in entirety? Yes.
BBharat Shah
Okay. And I presume depreciation probably would grow marginally for the next year is I think most of the capitalization has occurred. Am I right?
Bijay Agarwal
That’s right. Most of the assets will be Capex is already done. Capitalization is already done. So we don’t foresee much of increase in the depreciation going forward.
BBharat Shah
Okay. And interest which is about 58 crore for the last year would you say of course it will grow less because of then the top line growth because of the rate of reduction likely plus the reduction in working capital. But would you say it will be the growth in interest costs will be much lower than the top line growth of 30 35% that you have talked about.
Bijay Agarwal
Yes, that’s what we are targeting for. We don’t expect that much of straightforward linear increase in the overall borrowing level and the interest cost is primarily linked with the borrowing level only. So we expect a better improved cash flow going forward. With that this increase in the finance cost will be much lower to be. Much lower than the top line.
BBharat Shah
Yes, absolutely. All right, thank you and best wishes.
Jayesh Doshi
Thank you.
operator
Thank you. We take the next question from the line of the Prav Shrivastav from Philip Capital. Please go ahead.
Prav Shrivastav
Yeah, hi, I’m audible, right?
Jayesh Doshi
Yes, please.
Prav Shrivastav
So quickly on a question on the pnl, it’s obvious other expense for the last four quarters doesn’t add up. If we convert it with the full year. Other expense. Can we explain the reason for that?
Jayesh Doshi
You can send queries separately, we can check. And if there is a regrouping, it. Could be because of regrouping in the quarter or something like that. But you said other expenses.
Prav Shrivastav
Yes, yes, yes, sir.
Jayesh Doshi
Okay.
Prav Shrivastav
No worries. So quickly on the order book. So obviously the as said, we currently have an order book of around 5200-5400 crores. So will it have an execution time in the 14 to 15 months, is that right?
Jayesh Doshi
It varies. It varies up to 18 months also. Few of the businesses will go beyond 12 months also.
Prav Shrivastav
So sir, I mean if I multiply, if I divide that number by let’s say 1.25, assuming it to have an execution period of 15 months, the growth trajectory which you have shared doesn’t add up. So are you expecting to win more orders, short term orders which will lead you to achieve that target?
Jayesh Doshi
Yeah, yeah. It is not that the orders which you have got on first April would only cost each other for the current year. What we have shared in the orders which we have another thing during the course of the year, the visibilities which we receive and the new customers which we get, we keep getting the revenue, sir. So it’s not that only opening orders as on 3-4-25 would form the basis of the revenue for 25:26. It is the order in hand as of 31st of March or 1st of April, plus the orders which accrue during the year.
We have guided the same figure last time. What was the figure last time? If you guided. So just one comment on this. Different customers behave differently. Some customers give you order for a couple of months. Other customers give visibility for the whole year or even higher than that. So it’s a combination of different customer behaviors. So we’re expecting short cycle orders in coming months and that leads to a confidence in the. Yes, there will be orders coming in as we go through the year. It will keep coming in, we keep. Fulfilling the orders and the new orders. Are coming in from the customers.
Prav Shrivastav
Sure. And lastly, on the smart metering side, obviously the utilities, what we are hearing from utilities is that they’re not. A lot of the installations are not happening at a great pace. So what are your thoughts from the ground view? Are you seeing the installations happening what their clients seeing on Smart metering?
Jayesh Doshi
End of the day, we supply to the metering companies and what we are expecting and we are witnessing is a robust demand from that. There could be monthly quarterly bids. For example. If one of my customers has an order and various installations are not happening, obviously he will then slow down in one quarter and then wrap up in the next quarter. But on an annualized basis, we expect this business to have a robust growth. We witnessed it over the last 12 to 15 months. And we are, by the way, one of the largest electronic EMS companies in the country providing these metering devices not now, but for the last 18 years.
But we are very selective with our clients. We are very selective with our clients because the end customer being the government, the working capital cycle is long enough and we’re very mindful of the financial credibility of our customers. The business can grow much faster if we just pick up the customers. Therefore working capital will subsequently get stuck up. So we are a bit choosy on the customers in this segment.
Prav Shrivastav
Right, sir. And the last question that I’m allowed to ask. What percentage of bill of Matri will be contributing in Smart Meeting? I mean the final box is around 5000 rupees. So your contribution will be around 3000. Is that correct or is it less? Is it more?
Jayesh Doshi
Oh no, no, it’s not 3000 rupees. I think the smart meeting value would vary from 7,800rupees to 1200, 1500 rupees. Nothing more than that. Electronics. The electronics we do only the electronics we don’t do. The electrical we don’t do. The plastics or the botmill sh and other things we don’t do. Okay, thank you.
Prav Shrivastav
Thank you.
Prav Shrivastav
Thank you.
operator
Thank you. We take the next question from the line of Mahesh Chawan from I Wealth Management. Please go ahead.
Mahesh Chawan
Hello. S audible Hello. Yeah, hi sir. Congratulations on good setup numbers. Two questions were there. First question was from the consumer side, what percentage of RFID module contributes in the consumer business? And another question was in the industry, sorry, the second application which you mentioned that the consumer segment will be going down from 35 to 30%. Can this repeat the bifurcation for other segments as well?
Jasbir S. Gujral
RFID business would be approximately 8%, 7 and a half to 8% of my total business company.
Mahesh Chawan
Okay, sir. And segment application going ahead for FY26 and 27.
Jasbir S. Gujral
FY26 also we are expecting the overall RFID business will be somewhere in the range of 8 to 10 session only. That’s what we are guiding right now.
Mahesh Chawan
No, I, I, I mean the overall like the consumer segment which you said right now it contributes around 35% of total revenue. Right? In FY23 you have seen that it will scale down to 30%. So similarly I wanted for FY27 also.
Jayesh Doshi
See FY26. We said consumer business will be around 30% on track to bring it down to 30 and I think we retain it at about 50%. It may come down slightly more between 25 and 30%. But our endeavor would be to fill up that gap with our own design products. In the other consumer segment, what we are referring to is a high volume, low margin consumer segment which is part of this consumer business that will come down. But I think in 26, 27 the consumer segment in totality would be anything between 25 and 30%.
Prav Shrivastav
Thank you so much.
operator
Thank you. Ladies and gentlemen, in the interest of time, that was the last question. I would now like to hand the conference over to Mr. Gujaray for closing the comments.
Jasbir S. Gujral
Thank you everyone. I think we have had a good year in FY25 and we expect to continue this good work going forward in FY26 and 27. The figures and financials have all been discussed. What objective we have for the management is to again as I’ve always been saying, to have a sustainable organization which can continue to deliver returns to all the stakeholders. ESG is very, very important for us and we have a separate team monitoring over ESG performance. And as I shared with you, we are among the top 35% companies globally adhering to the ESG standards.
Going forward, this effort will be further doubled up. We have our capacities in place and as we have shared last time, we are now planning to grow on a campus model rather than a standalone unit model efforts for the long run, 25, 26, 26, 27 is short run. For the long run is to move up the value added chain through OTM which currently this year was I think about 12% of our revenue. And I shared last year that we internally believe that we should be at about 25% which is a very, very small part. But I believe that in the long run this 12% should grow up.
And once this goes up, along with the export and growth in the other what high margin vertical, we are on track to deliver sustained growth at superior EBITDA margins than what we have been delivering in the past focus will be on generating cash flow, working capital, capital efficiency and organization. And we would, as I said, in all probability, seriously, we are evaluating to participate in the component dlis. So to make India electronics hub. We would like to participate in that scheme of the government of India and the honorable Prime Minister with all over sincerity and effort.
Thank you very much.
operator
On behalf of JM Financial Institutional securities limited that concludes this conference. Thank you for joining us. And you may now disconnect your lines. It.