Uniparts India Ltd (NSE: UNIPARTS) Q1 2026 Earnings Call dated Aug. 11, 2025
Corporate Participants:
Unidentified Speaker
Monali Jain — Investor Relations, Go India Advisors
Gurdeep Soni — Chairman and Managing Director
Rohit Maheshwari — Group Chief Financial Officer
Tanushree Bagrodia — Whole Time Director and Group Chief Operating Officer
Analysts:
Unidentified Participant
Nirmam Mehta — Analyst
Viraj Kacharia — Analyst
Prolin B. Nandu — Analyst
Sunil Jain — Analyst
Love Gupta — Analyst
Rajat Setiya — Analyst
Dheeraj Kumar Reddy Dosakayala — Analyst
Saumil Shah — Analyst
Vipul Shah — Analyst
Shrinjana Mittal — Analyst
Dixit Doshi — Analyst
Keshav Bharadia — Analyst
Nagraj Chandrasekar — Analyst
Presentation:
operator
Ladies and gentlemen, good day and welcome TO Uniparts India Ltd. Q1FY26 earnings conference call hosted by Goindia Advisors. As a reminder, all participant lines will be in the lesson only mode and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing Star then zero on your touchstone phone. Please note that this conference is being recorded. I now hand the conference over to Ms. Monali Jain from Go India Advisors. Thank you. And over to you Ma’. Am.
Monali Jain — Investor Relations, Go India Advisors
Thank you, Yusuf. Good morning everyone and welcome to Q1FY26 earnings call of Uniparts India Limited. We have on the call Mr. Gurdeep Soni, Chairman and Managing Director, Ms. Tanushi Bagrodiya, Director Group Chief Operating Officer, Mr. Rohit Maheshwari, Group Chief Financial Officer and Mr. Himanshu Sharma, Deputy General Manager. We must remind you that the discussion on today’s call may include certain forward looking statements and must be therefore viewed in conjunction with the risk that company faces. I will now request Mr. Soni to take us through the financials and the business update subsequent to which we can open the floor for questions and answers.
Thank you and over to Sir.
Gurdeep Soni — Chairman and Managing Director
Thanks Monali. Good morning everyone. Welcome to the first quarter earning call for the financial year 26 of Unipas India Limited. Our Q1 FY26 began with encouraging signs in our top line performance. The off highway industry continues to face volatility with tariff uncertainties affecting short to mid term demand in the Americas. However, lower interest rate and stabilized equipment pricing are expected to drive purchases that farmers had previously deferred. Unipart’s resilient business model and dualshore manufacturing capabilities help us navigate market volatility and mitigate tariff related risks. Let me give you an industry overview and a little bit about the business performance.
The off highway market is showing early signs of recovery, particularly in Europe. Inventory buildup has begun in the small ag segment where the large ag market continues to witness further decline. The pace of decline in construction equipment segment appears to have been stabilized, particularly talking about construction. The major OEMs in the construction segment anticipate flat to slight decline. Despite this, Unipart continues to grow supported by strengthening relationship with global leaders in this segment and new business across Europe and other regions. Coming to the large AG major OEMs in USA project a 25 to 30% decline in the large ag segment while Europe shows early signs of recovery with inventory buildup and new business.
Unipart expects a healthy growth in the segment. However, farming income pressures in key Western markets may lead to cautious investment in equipment on the small side. A very favorable monsoon and steady farmer demand are expected to drive tractor sales of up to between 4 to 7% in FY26 in India. Unipars is well positioned to benefit due to its strong domestic presence globally as well. OEM project flagged to slightly declining sale, but inventory replenishment has begun and Uniparts anticipates mid teens growth in this segment coming to the aftermarket. This segment actually grew by 20% in FY25 for uniparts.
Addition of the Customers Addition of a customer Midstate, who is the second largest group of retail stores in North America is helping this growth and has more room to grow. We expect the segment to grow further in mid teens in FY26. Our strategy as a strategy, the company remains focused on strengthening the engagement and involvement with with the customers. In fact, the new business award book remains very healthy at 200 crore rupees and the actions on new business in large ag segment, large construction equipment and geographical diversification remain priority for us and the forward strategy continues to build on three pillars of deepening integration with our customers, driving operational efficiency and expanding our near shoring footprint in a measured and effective manner.
The diversified dualshore manufacturing business model of the company is helping to maintain its position as a market leader through mitigating the risk of volatilities in supply chain and due to the tariff announcements. A brief on the Financial position of the company For quarter one we achieved an EBITDA margin of 20%. Our cash flows remain robust and the company is net debt free with a net cash balance of 241 crores as of June 30, 2025. We expect to maintain consistent free cash flow generation in line with what we have done in financial year 25 levels. With that I’ll hand over to Rohit Maheshwari to present the financial performance for Q1 of FY26.
Thank you. Over to you.
Rohit Maheshwari — Group Chief Financial Officer
Thank you sir. Good morning everyone. Here are the financial and the business highlights for the quarter ending June 30, 2025. Q1 revenue from operations was INR 273 crores reflecting a 8.25% quarter on quarter increase and 4.2% year on year growth. Q1 EBITDA stood at INR 57.89 crores, up 39% from quarter four, FY25 and 26% year on year basis. Operating cash flow generation for the Q1 was INR 54 crores. The net working capital comprising of big three elements of inventory, account receivable and account payables as number of days of TDM revenue from operations to 156 days as on 30 June 2025 uniparts remains a net debt free company with a group net cash position of approximately INR 2 241.6 crores at the end of June 2025.
Capex outflow during the quarter was approximately 7 crores. New Business Award over the past 12 months total approximately INR 200 crore plus in analyzed potential value. Key monitorables include global economic slowdown, geopolitical uncertainties, evolving trade tariffs, persistent inflation and elevated interest rates with somebody I would like to hand over the conference back to the moderator for question and answer session. Thanks very much. Thank you.
Questions and Answers:
operator
Thank you sir. We will now begin the question and answer session. Anyone who wishes to ask question may press Star and one on the Touchstone telephone. If you wish to withdraw yourself from the question queue you may press star and 2. Participants are requested to use handset while asking a question. Ladies and gentlemen, we’ll wait for a moment while the question queue assembles. First question is from the line of Nirmam from Unique pms. Please go ahead.
Nirmam Mehta
Thank you for the opportunity. So historically we’ve seen that Q1 revenues are, you know, lower than Q4 revenues but this time we’ve bugged the trend.
So you know if you could explain what led to this and also was there an element of pre buying related to the tariffs in this.
Tanushree Bagrodia
Hi, Tanishree Bagrodi here. Good morning and thank you for your question. So as you have seen in the results, you know the results have been that we’ve seen a 5% growth in the top line year on year and an 8% growth in the top line quarter on quarter. And you know this growth is really driven by what we have been saying in the last few quarters where what we said was that quarter three of FY25 was the bottoming out of the was the bottoming out of the cycle. We expected the cycle to turn from quarter four onwards which is what we’ve been seeing.
We’ve also been very categorical in stating that you know our efforts have been to win new business because it’s the new business that helps us grow. You know We’ve won over 200 crores of new business as was just stated which has contributed to this growth. And I you know we also look at the markets going forward the markets going forward, construction globally seems to have stabilized. Small ag is let’s say minus 5% to flattish. In fact Asia Pacific and India are growing. It’s flattish in Europe and let’s say minus 5% in the US. It’s the large AG in Europe and US that remains under pressure.
So I think that’s where the growth is really coming from. To answer your next question, where pre buying due to tariff? No, there was no pre buying due to tariff.
Nirmam Mehta
Okay ma’, am, that’s helpful. And secondly, you know our gross margins have also increased to say 65, 66%. So you know what led to this improvement also?
Tanushree Bagrodia
Yeah, our gross margin went up because if you see our material cost as a percentage of revenue is at roughly about 34% in this quarter, which you know, which is in the range of let’s say about 36% typically. And this really comes because of the FX impact on the inventory valuation. Right. You’ll see that the inventory has gone up by roughly about 7 crores and that’s largely due to the currency impact. The Euro went up quarter on quarter.
Nirmam Mehta
Okay, ma’. Am. And lastly, so we’ve been mentioning that we’ve won a new business in Europe and in the large agriculture segment. And so has the offtake started from there and would we see increasing contribution from Europe this year and from here on?
Tanushree Bagrodia
I think we’ve been saying that the large ag is an area that we’d like to grow in. That’s where we’ve got the new business. The offtake is yet to start on that but it remains on track as of now. And this year as we are seeing large ag is going to contribute a healthy growth percentage to the overall growth.
Nirmam Mehta
Okay, thank you. That’s it for my side.
operator
Thank you. Next question is from the line of Viraj from Simpl. Please go ahead.
Viraj Kacharia
Yeah, hi, thanks for the opportunity. Just a follow up question on the gross margin. So correct me. What I understood is there’s a 7 crore inventory valuation gain in our total RMC cost. And this is one of the primary reason why the gross margin is at 66% as against you know, the past 10 of 62 to 63, 64. Would that be a right thinking?
Tanushree Bagrodia
Yeah, that’s, that’s the right way to look at it.
Viraj Kacharia
Okay, Second question is, see if you look at last quarter our thinking was that even despite the market environment given with the new business pipeline is shaping up for us, we would expect a meeting growth which would largely be back ended in the second half. But if you look at Q1 itself, we have seen some bit of good growth in the quarter. So I think somewhere at the start of the call you eluded it. Inventory filling or normalization of inventory is also one of the key factor. So can you give some perspective if I have to understand a normal inventory cycle say at the customer or at the channel level compared to that where would now be at, you know, as of Q1 end and what kind of additional delta we would have got in the quarter because of this.
Tanushree Bagrodia
So Bijaj, I think let me start by saying that we, we maintain that, you know there is a, there are good signs of recovery is happening. The growth that we are seeing is driven by our new business growth. Last quarter we had mentioned that the trailing twelve month new business was about 190, 195 crores. This time we are saying that the new business growth for the trailing 12 months is 200 crore plus. Right. So you are seeing that our new business growth is driving these efforts. We still maintain that the second half of the the financial year is where the growth is really going to come from.
If you see what is happening in the larger markets, as I mentioned earlier, construction industry is seeming to stabilize globally. Right. They are looking at about a flattish calendar year. All our customers are looking at a flattish calendar year. So that’s where we are in the small AG segment. Again there is growth in India that is happening roughly about let’s say 6% growth in this fiscal due to the good monsoon that we’ve had. Asia Pacific is looking at growth. Europe is looking flattish. America is best at minus 5%. Large ag remains in trouble. I think what has happened is that the inventory destocking that was happening has stopped to happen.
So there is some amount of pickup that has started in small AG and in construction and I think that’s where we are in the market. Our quarter one results even in quarter four. We had said that you know, quarter one would be quarter one, FY26 would be closer to quarter one of FY25. That’s where we’ve landed. So we had visibility of saying that the order books remain to be healthy also driven by the new business that we are winning.
Viraj Kacharia
So I got that element. What I was also trying to understand if I have to compare just the inventory cycle at customers or at the channel level compared to a normal cycle, where would that be? Either now normalize or there’s still some more time, you know, more restocking has to happen for it to reach a normal cycle. So that was one question. And second question which I also wanted to understand is now given way the tariff is rates are playing out especially from India somewhere. We were earlier looking at eventually having our own manufacturing presence in Mexico or US so how does the relative position you think it will put us in, especially from Exports for India, 50%, where to materialize and any thoughts on Mexico plant setup? So these are three questions.
Tanushree Bagrodia
Right? So I think, I think Viraj, let’s look at it that you know, for small ag and construction, I think we are, we are okay on the inventory cycle. I think large Ag is the new business that is helping us grow. Because large ag, you’re still seeing a double digit degrowth for OEMs, right? So I think that’s where we are on the inventory cycles. I think coming to your question on tariffs, I think tariffs are an interesting opportunity for a company like unipas in the first phase of tariffs. As you would have noticed on our call last time we had said that, you know, we concluded with our customers, we were looking at a P and L neutrality situation.
And today we are in discussions with customers to arrive at, arrive at a position which is a win win for both the customers and us. What enables us really to do this is also having us local manufacturing which allows us to produce something locally where it may make sense for the customer and hence taking away the tariff impact. I think in a similar way our warehousing in Mexico is on track and we will be operational in the next two months. October 25th is when we will be operational with our warehouse. That will then allow us to supply to our customers from Mexico as and when it would make sense.
We have always maintained that this is the first phase of our expansion and as and when the opportunities deem fit and we come across as opportunities to expand our operations in Mexico, we will do so. Is there anything that we can concretely bring to the table and share with you? At the moment, not really. But as soon as that happens, we will share it.
Viraj Kacharia
Okay. Thanks all. Thank you. I’ll come back in queue.
operator
Thank you. Ladies and gentlemen, in order to ensure that the management is able to address questions from all the participants in the question queue, please limit your questions to two per participants. Should you have a follow up questions, please rejoin the queue. Next question is from the line of Prolin B Nandu from Edelweiss Public Alternatives. Please go ahead.
Prolin B. Nandu
Yeah. Hi. Thank you for giving me this opportunity. So Tanushti Ma’, am, first question would be on the growth for the remainder of the year. Given that you know, while the last time when we, when we were on the call, you gave a guidance or some, you know, some forward looking statement. But since then this tariff is a newspaper, right? Nobody knows what to do about it. But what is your sense ma’? Am? How should the rest of the your pan out to be given that, you know, there is a uncertainty at least in terms of growth on the tariff part? And has any of your, you know, subsegments that you discussed, including aftermarket or for that matter geography, large, small lag. Right. Has anything changed in terms of their outlook because of this tariff thing? Right. Or general macroeconomic environment? So can you just you know, paint a picture for us as to how should one think about the rest of the year in terms of growth?
Tanushree Bagrodia
Hi. Hi Praline. So Praline, we maintain that we will look at a mid teen growth for the full year of FY26. Quarter one was on track, quarter two remains on track. So we are seeing no change on the growth for the full year. I think your question on has anything changed in any subsegment or geography due to tariff? Again like I said, the short answer to that is really no. Nothing has changed. Now let me again elaborate. When we first came in with the tariffs, we had two types of tariffs. We went and spoke to customers, we reached an agreement, we were P and L neutral.
Once again we have started discussions with customers and we are very confident that we will come out in a position which is mutually viable. And lastly, as I was just explaining, we remain very uniquely positioned with our manufacturing in the US and with the Mexico warehouse coming up in two months to be able to supply to customers. So I think we remain in a very, very strong, strong position to be able to serve our customers and to be able to find a viable solution to the diet.
Prolin B. Nandu
Thank you for that. The second question would be on margins, specifically on gross margins. While I, I mean while you mentioned the 7 crores impact was due to currency which, which equates to around 2%. Right. Gains on margins. But even if we remove that 2% which can be termed, let’s say as a one off, still we are healthy at around 17%. Right. So from year on, since you are saying that mid teens is the growth that we expect for the rest of the year, so growth should pick up for the remainder of the quarter. So is this quarter right kind of, you know, example as to how the operating leverage in our business will pan out going forward that this, you know, at least 200 or bps of gross margin gain Even if we remove this inventory impact, is this something that is only going to increase going forward? What is your sense? How should one think about operating leverage and gross margins going forward?
Tanushree Bagrodia
I think Tolin, very interesting question. Right. I think you’re absolutely right. This quarter is a good indication of saying how the operating deleverage can play in our favor. Right. So I think if you look at it our EBITDA has in absolute terms operating EBITDA has grown 17 crores while the top line has grown 20 crores. Right. So there itself is the answer for you. And I think that’s been our constant feedback to the investors as well that while we are trying to control costs and which is also evident in the, in the P and L that you see this time we’ve been maintaining costs.
Even today the minute our top line is increasing the profitability comes back. So I think you’re absolutely right. This quarter does give an indication of how operating deleverage could work for us.
Prolin B. Nandu
I’ll join back in the queue. Anushi ma’, am, thank you so much for these answers.
operator
Thank you. Next question is from the line of Sunil Jain from Nirmal Bank Securities. Please go ahead.
Sunil Jain
Yeah, thanks for the question. My question relates to the tariff. Can you clarify how much tariff is right was there in the last quarter and how much is right now and how you expect it post the additional 25% will come.
Tanushree Bagrodia
So Sunil Ji, last quarter we’d explained we have two types of tariffs. One is section 232 and one is the reciprocal tariff which is applicable. I think those are the type of tariffs that continue to remain. And I think what has now happened is that the reciprocal tariff has gone up from what was 10% to 25% and now with the Russian oil penalty it’s looking at 50%. What we had been able to do in the first time when both section 232 and the reciprocal tariffs were employed were go back to customs, have discussions, understand how we would come to, how we would come to a situation that could work for them and for us.
And I think now what has happened is, and I think what has now happened is that the new tariffs have come in and we need to and we need to restart having those countries conversations which we started to have. Which we started to do. Right. How they conclude we will let you know subsequently. Are we confident that we’ll be able to conclude them in 232? Section 232 tariffs also went up from 25% to 50%. And even those conversations were concluded. So now what we are looking to really talk about is the reciprocal tariffs that have gone up from 10% to 50%.
So I think that’s the trajectory that we’ve been on and which tells us that we are able to work with customers to find winning solutions for both parties. And what gives us this confidence, I’ll again repeat myself, is the fact that our business model affords us the opportunity of doing so. We can manufacture in India and sell it to them from our warehouses. We can manufacture in the US and sell it to them. We can manufacture in India and direct export to them. So whichever cost model suits them best, we can deploy that. And going forward, when we have Mexico in place, that becomes another option.
Sunil Jain
Yeah, great. So what I understood, like last quarter we had a reciprocal 10% which is now increased to 25 and that may increase to 50% in the future.
Tanushree Bagrodia
Yes.
Sunil Jain
And so. And any of our product is exempt from any duty or something?
Tanushree Bagrodia
No, we don’t have any product which is exempt from any of the tariffs. Either it will come under section 232 or it will come under the reciprocal tariff regime.
Sunil Jain
Okay. And again coming back on the gross margin, the gross margins, what you said that see there was a benefit deleveraging benefit which is coming below gross margin. So we are seeing some up move in the gross margin as well.
Tanushree Bagrodia
Yeah, so we are seeing an upward movement in the gross margin. And like I said, that really comes in from the fact that there has been a currency impact because the Euro has actually gone up which is also sitting in our inventory valuation.
Sunil Jain
Okay. That is exactly 7 crore or.
operator
Sorry to interrupt. Mr. Jain, may we please request you to rejoin the queue, sir. Several participants are waiting for their turn, sir. Thank you, sir. Participants are requested to please restrict your questions to two participants. Should you have a follow up questions, please rejoin the queue. Next question is from the line of Love Gupta from Countercyclical Investments. Please go ahead.
Love Gupta
Hello. Thank you for the opportunity. So you know, our quarter one margins have been great. So are these numbers like margin revenue and new business orders sustainable going forward or is it due to stocking up by customers?
Tanushree Bagrodia
Hi Love. Well, I think. I don’t. I’d like to say that, you know, we were very confident that these numbers at the end of Q4, what we had said about Q1 has panned out. We think Q2 will be in line with Q1 going forward. This is really coming from the new business that we have won. Right. Again, we were maintaining a trajectory of about 190, 195 crores. Till last quarter we’ve gone over 200 crores. And that’s what’s really giving us the confidence of, of the growth in the top line. We are also looking at how the customers are responding, how their end order books are looking.
So, you know, we are continuously monitoring not just tariffs, but we are monitoring interest rates, we are monitoring farm prices. We remain in dialogue with our customers where again, there are green shoots of recovery that we are seeing with customers in Europe and us in segments other than the large ag segment. Right. So I think the top line growth as of now remains, remains a reality. I think the margins, like we were discussing the gross margins this time are a little higher than what they should be because the euro had, you know, the euro has gone up and that has created an impact.
But clearly we are seeing the deleveraging impact come on the ebitda. And this is something that will continue barring the foreign currency movement. I also think as management we are very keen to ensure that we control costs and we continue to make investments as needed. And so that prudence and balance is also something that we will maintain.
Love Gupta
Okay, so my next question was that, you know, even if we shift manufacturing to us, how would our margins be affected if we do that?
Tanushree Bagrodia
So I think, you know, this is going to, none of it is going to be done in a manner which is hasty, which is unbalanced. Right. Even from a customer perspective, it only makes sense to move those products to the US where there is a benefit for the customer. Right. And if there is a benefit for the customer there, that tends to be a benefit for us as well. I’ll give you an example. We have one customer where, you know, they said that, you know, you manage customers have been looking to de risk supply chain.
Let me actually just state that not just from today, but you know, post Covid. So that supply chain de risking has already happened. And a great example is where one of our customers, even when the tariffs were not there, had come to us saying that, listen, you manufacture an X percent in India and a Y percent in the US and give us a blended price. And that’s how we were supplying to them. So I think that’s the route the customers take. So we gave them a blended price and I think that’s the way forward for us because customers also understand that the business model we have gives them a best cost solution possible.
Love Gupta
Okay, so it doesn’t have any.
operator
Sorry to interrupt. Mr. Gupta, maybe please request you to rejoin the queue, sir. Thank you. Next question is from the Line of Rajat Setia from I thought pms. Please go ahead.
Rajat Setiya
Hi, thanks for the opportunity. Am I audible?
Tanushree Bagrodia
Yes you are.
operator
Yes, please go ahead.
Rajat Setiya
Thanks. One question about in the context of US tariffs, so we have our plant in US so do you see more of manufacturing happening there?
Tanushree Bagrodia
So Rajat. Yes, I think that’s the attempt and that’s the opportunity really that Uniparts has, right? That we can go to customers and we are working with customers on saying what more can we do for them over there so that we provide to them with a solution that is a win win. So I think those discussions really, really have started and we are seeing those opportunities.
Rajat Setiya
So the manufacturing that happens there, is it like end to end, you need to make it there or you can make semi manufactured here, semi finished product from India is going there and then you can finalize the product there and then sell it.
Tanushree Bagrodia
So that entity is capable of doing end to end manufacturing. Right. We can also actually do that. We do part of the work here and assemble over there. I think the question really becomes is do we do end to end manufacturing? Do we do part here, part there? Because remember even if we do part here now the tariffs are applicable, right? So ultimately whatever whether we do end to end manufacturing or whether we do part here and part there would really be dependent case to case in saying what delivers the best cost to the customer.
Rajat Setiya
So how big is that facility and what kind of revenues can you do from there?
Tanushree Bagrodia
So I think that facility is big enough for us to be able to actually deliver about 50% more than what we are delivering today.
Rajat Setiya
And as a percentage of U.S. customers demands that we have or let the U.S. things that we do as a percentage of that how much it can get to do.
Tanushree Bagrodia
So Ranit again like I said, it’s very difficult to put a number to that right now because you know this depends customer to customer, product to product, what can we do? I think the question really is do we have the capacity? Absolutely. Can we do end to end manufacturing? Absolutely. And would we need large Capexes to sort of to be able to do that? Not really.
Rajat Setiya
And one last one.
operator
Sorry to interrupt. Mr. Satya, maybe please request you to rejoin the you sir. Thank you sir. Next question is from the line of Dheeraj Kumar Reddy Dosa Kayala from Alpha Square. Please go ahead.
Dheeraj Kumar Reddy Dosakayala
Yeah. Hi ma’, am. Thanks for the opportunity. I just have like couple of questions. The first one being I mean what is the aspiration to get to like a 2000 crore revenue? I mean when do you see this Happening. What is the strategic call the company is taking to move in that direction?
Tanushree Bagrodia
Dheeraj, thank you for that answer. And I think, you know, as an organization, we have ever since our IPO been saying that. Listen, the philosophy or the strategy of the organization is we started as a component provider. We grew into a system provider. Then we deeply penetrated our customers to grow horizontally. And carrying on with this horizontal expansion with our customers to get more value per vehicle is something that we will Continue. We have two very strong platforms, 3PL and PMP. We set up a new entity in Ludhiana to do fabrications. We are actually expanding with that entity into fabrications.
Are we there completely on fabrications? No, but that’s a platform we want to solidify our presence into. And then other than that, there are two platforms that we want to add. One is hydraulics and one is power takeoff units. So as we expand into these three, our journey to reaching the 2,000 crore plus sort of revenues is going to become a reality. We are open to, of course, we are pushing through organic growth. And you know, you can see the numbers that we talk about. The new business acquisition. We are also looking at new customer acquisitions which was evident when we acquired the second largest retail store chain in the aftermarket in the US and you know, that is on our organic growth.
And we are also open to inorganic growth. And we’ve also said that as opportunities present themselves, we look at them. So I think that’s the strategy of the organization. To grow the business and to double the top line.
Dheeraj Kumar Reddy Dosakayala
Got it. Thanks a lot for that. What is the timeline you see for this aspiration to become true?
Tanushree Bagrodia
I think when we look at our five year plan, that’s where, that’s where the aspirations are. Dheeraj. Got it, ma’. Am.
Dheeraj Kumar Reddy Dosakayala
Just to add at 350 crores of revenue just because today we are at 270 crores. But say we are, we are winning new business. And also the existing business is growing. And if we get to a 350 crore, the cost will be the below the gross margin. Do you think the cost will be the same or do you see some sort of addition into our costs?
Tanushree Bagrodia
I think, Dheeraj, again, it depends, right? Will the costs below the gross margin really go up in proportion to where the top line increase is happening? No. Right. Because there is some amount of operating date leverage. But there will be certain costs that will go up, right? And that will. That will depend on where this new growth is coming from. If the new growth is coming from, let’s say A new product platform there some costs will go up. If it is coming because we’ve won a very good business in existing platforms, the growth and the costs will not be so much.
So again, it’s not about just a mathematical answer. It depends on what business we are winning, for what customer we are winning, what type of business it is. Right. Many variables. But clearly the strategy of the organization and the prudence with which we run the business is to say that if top line is growing, our fixed costs cannot grow in that proportion.
Dheeraj Kumar Reddy Dosakayala
Got it? Got it. Ma’, am, just another question. If the tariff scenario becomes true.
operator
May we please request you to rejoin the quesa. Thank you. Ladies and gentlemen, in order to ensure that the management is able to address question from all the participants in the conference, please restrict your questions to one per participant. If you have a follow up questions, please rejoin the queue. Next question is from the line of Somil Shah from Paris Investments. Please go ahead.
Saumil Shah
Yeah, good afternoon and congrats on a good quarterly performance, Ma’. Am. As we are seeing that Q2 is on to achieve the desired growth and second half to be normally better than the first half. So can we expect this year we may be similar to FY24 numbers or even surpass FY24 revenue number.
Tanushree Bagrodia
Hi Somil, thank you for your compliments. And you know we continue to endeavor to work hard to ensure that we deliver value. We’ve maintained that we are looking at mid teens growth for the full year and that’s where year on year. Right. So I think that that outlook we maintain even today.
Saumil Shah
Okay, okay. And in terms of EBITDA, can it be in excess of 18% this year?
Tanushree Bagrodia
So as we are, as we are looking at quarter one performance and if we continue to perform well, I think we can look at, we can look at EBITDAs in the range of 18%.
Saumil Shah
Okay, okay. And ma’, am, just.
operator
Sorry Mr. Shah, please request you to rejoin the queue, sir. Okay, thank you. Sir, next question is from the line of Vipul Kumaranupchan Shah from Sumangal Investments. Please go ahead.
Vipul Shah
Hi. What percentage of our turnover totally today is manufactured in US madam?
Tanushree Bagrodia
So I think roughly about 10% of our total revenue is manufactured in the US.
Vipul Shah
10%.
Tanushree Bagrodia
10%.
Vipul Shah
So you said you can increase it. By 50% in the case of adverse tariffs. So maximum potential is 15% of revenue. Can come only from us. So rest we allowed to manufactured and manufactured in India and export only. So that will be very sizable proportion.
Tanushree Bagrodia
No, I think, I think, I think the way to look at this is while we are saying that we can increase our capacity by 50%, it also has to be looked at case by case basis. What would make sense to manufacture there? What can be manufactured here and sent there and still be a best cost. Right. And we are still talking about our existing facility. Do we have the ability to do expansion? Absolutely. We also have the ability to do expansion. You know, we’re sitting on cash today. As Rohit mentioned, we’re sitting on 242 crores of cash.
So I think we have that capability. But I would again urge you to not look at it just as pure numbers. Because this is business which is slightly more complex in saying what will make sense of manufacturing in India and still supplying to the customer from India and what can we move despite the tariffs and what can we move to the us Manufacture in the US and supply to customers to mitigate the impact of IT tariffs. So I think it’s a, it’s a blended call that will need to be taken customer to customer.
Vipul Shah
So at 50% tariff, manufacturing in India will still be profitable in some cases.
Tanushree Bagrodia
It may make sense. Absolutely.
Vipul Shah
Okay, thank you. I’ll rejoin the queue.
operator
Thank you sir. Next question is from the line of Shirinjana Mittal from Ms. Capital. Please proceed.
Shrinjana Mittal
Hi. Thank you for the opportunity. I just wanted to understand the new order wins that you’re talking about of 200 odd crore. Is that expected to be executed in one year time frame? And also can you give some color on who these new order wins are from? Are these largely retail chains with aftermarket orders in us or is there some other type of customer? Yeah, that would be my question,
Tanushree Bagrodia
Shanjana. Thank you for that question, Shanjana. We are a business that does 80% OEM, 20% aftermarket and both our businesses are growing. In FY26 we expect growth to come from a large part of our growth to come from construction equipment.
A healthy growth to come from large ag, aftermarket and you know, smaller growth to come from small ag where we anyways have a dominant position. So our new business actually is split across construction, large ag, aftermarket and to some extent even small ag. Right. It’s across, it’s also across regions and geographies. There is no particular geography that would, that would sort of dominate because remember we are building a de risk business model and we like to have geographic sectoral diversification. I think your, your other question was is the 200 crores executed? Right. I think when we talk about the new business wins, we, we talk about in the last 12 months.
What are the new businesses that we have won? They get executed over a period of time, right? So what we are saying is that while till the last quarter when we came on a call our new business in the last 12 months that we had won was about 195 crores. At the end of June 2025, when we look at what’s the new business that we have won, it’s about 200 crore. It’s 200 crore plus. Actually it’s for the last 12 months and this will now be executed. That’s the way to look at the new business that we talk about.
Shrinjana Mittal
Right. And first.
operator
Sorry to interrupt, Ms. Mittal. May we please request you to rejoin the queue, ma’?
Shrinjana Mittal
Am. Sure.
operator
Thank you. Participants are requested to please restrict your questions to one per participant. Should you have a follow up questions, please rejoin the queue. Next question is from the line of Dixit Doshi from Whitestone Financial Advisors Private Limited. Please go ahead.
Dixit Doshi
Yeah, thanks for the opportunity. A couple of things. Firstly, what. So whatever OEM supply we have, those OEM must be having a multiple vendors. So if you can just broadly touch upon that those competitors would be from which country that if you can explain. And secondly you mentioned that you know we have to look at in a whole that like we can manufacture let’s say 15% in the US plant. But let’s say when we are doing discussions with the customers do we explain them that you know since the tariff has to be borne by them so we can do some manufacturing there so that the full tariff could be passed on on the products which you know, manufactured in India.
Tanushree Bagrodia
Sorry, can you repeat your second question please? I didn’t quite understand it fully when we.
Dixit Doshi
Yeah. So when we negotiate with the customers. So let’s say if we were not having any plant in USA then entire production supply to the US client we’d be having 50% tariff. But now we can give them some product from the our US plant. So we are giving them some benefit through that. So does that helps us in negotiating that whatever we are producing from India we can pass on the full tariff to them?
Tanushree Bagrodia
Right. Okay. So I think, let me take your question in the order that you’ve asked them your two questions. So your first question was on competition, right? Where is competition coming, coming from? And I think in the tractor market where our three point linkage systems go, I think the way I would look at it is India is the largest manufacturer of the lower HP tractors. And given that the competition in the small ag space is largely from India the large ag market is largely a western market. And there the competition really comes in from Europe.
I think what differentiates us in India from our competition is the quality and the delivery propositions that we have, which is a very, very differentiated business model where we can provide to the customers either locally in India, we can supply to global customers in their geographies, or we can even direct export. Right. And our quality remains our great differentiator in our second vertical of precision machine parts. You know, we’ve been working for many, many years with our customers and have developed very deep relationships. And hence we’ve been actually been able to grow this segment today to almost 50% of our revenue.
A large part of our competition in this segment does come from China. And again, you know, the differentiating segment factor for us in this is the fact that we have near shoring, dual shoring, and the best cost country supplier model. I think we are also looked at as a very, very agile partner to our customers. You know, when our customers wanted us to set up in Mexico, we’ve actually taken the call and we will be active in Mexico in from October onwards. So I think that’s, that’s the answer on who competition is. I think when we then look at the tariff situation, right.
I think again, yes, we can manufacture in the US to be able to mitigate some of the tariff impact. Right. But I think, I think what’s more key to understand is that there are certain parts which would still make sense to manufacture in India and to export. Right. And there, there will be, and then there will be opportunities where we can consolidate manufacturing in the US for the customer and supply to them. So it will become a blend of the two, which will mitigate the impact of the tariff, the customer. It will not be an either or approach.
It will have to be an and approach.
Dixit Doshi
Okay. Okay, that’s it for my.
operator
Thank you. Next question is from the line of Keshav Bharadia from Walford Financial. Please go ahead.
Keshav Bharadia
Yeah, hi. Am I audible?
operator
Yes, please proceed.
Keshav Bharadia
Hi, ma’. Am. Congratulations on a good set of numbers. Just a few questions. So with the effective tariff rate going up from India and just about having some capacity in the U.S. do we risk losing some business to competitors in other Southeast Asian countries or do you think the customer stickiness is high enough that the orders will still stay with us?
Tanushree Bagrodia
So, hi, Keshav, and thank you for the compliments. Keshav. As far as competition is concerned, we jib dispute discussed. Right. I think in the small ag space, our competition is from India where we are anyways dealing with the same tariffs right in the large AG space, the competition is in Europe and I think that’s where again we do have an advantage because we are a better cost phrase. In any case, in the precision machine parts where we said we have competition from China, we also have the US manufacturing facility. I think if we numerically look at the number and we say we can do 50% more, then suddenly you know what is looking at, what is looking or what looks is that oh, you have limited capacity.
And like I said, instead of looking at it from this perspective, we also need to look at the blend of India and us right. And how that mitigates the impact. I think the other, the other view to take on this is that when we have competition from China, the tariffs are also there on China. And I think we are in a very, very solid position to be able to then react given our local manufacturing, given our local warehousing. With respect to competition in China on the precision machine part, I am not sure at this point in time Southeast Asia is not a competition.
If you also see tariffs are now looking at any China supplies that are routed through Southeast Asia being having higher tariffs and that’s 40% higher tariffs. So that anyways gets taken care of.
Keshav Bharadia
Got it ma’. Am. And just a follow up question. With all the momentum that we are seeing in FTAs, are we trying to focus our efforts towards kind of diversifying our geographical presence more towards EU and US considering still 50, 55% of our order book in revenue comes from west just to kind of hedge against this direct uncertainty. And also ma’, am, you said that Q3FY25 saw the inventory destocking largely bottoming out. So are we expecting new order intake in this year? Any indication on that?
Tanushree Bagrodia
Sorry Keshav, could you repeat the second part of your question?
Keshav Bharadia
So ma’, am, you said that the inventory destocking has largely bottomed out in Q3 FY25. So are we expecting good momentum in new order intake in FY26?
Tanushree Bagrodia
Okay, I think let me take your second question right first where we are talking about what the order books are looking like in FY26. I think Keshav, the order books for FY26 look fairly stable. We can safely say that quarter two is going to be in line with quarter one and we are going to maintain the 15% the growth that we have sort of said for the full year. I think that sort of remains a visibility and a line of sight for us as we are sitting here today at the end of quarter one. Right.
So I think there’s no change to that. And the reason why these order books are there are for the reasons that we’ve discussed. Right. So I think that’s the answer to your second question. I think on the first question you mentioned that, you know, what is our long term strategy for the US And I’ll take that in two parts. See, I think if you look at our business over the years we have been building a business which is is de risk from a customer standpoint, from a geography standpoint. Now we are expanding our product platform so we are diversifying over there as well.
And in the long term, I think what we believe or you know, the endeavor is that US should be 40% of our revenue, Europe should be 30%, Asia 25% and rest of the world 5%. And our business growth is going to be executed in, in that line. So I think that really is hedging our bets where we are saying currency, geography, country, customer, product. We don’t want to be dependent or overly dependent on any one sector.
Keshav Bharadia
Got it, ma’. Am. And if I can just.
operator
Sorry to interrupt. Mr. Bharadia, may we please request you to rejoin the queue, sir. Thank you. Next question is from the line of Nagraj Chandrasekhar from HD Family office. Please go ahead.
Nagraj Chandrasekar
Hi Tanishree. Congrats on a very good set of numbers this quarter and last since you joined. Just a couple of questions from my side. Again slightly repetitive, but you know, our peers in the EU and in Japan with higher cost structures now face a 15% tariff. Is that the delta between 15 and 50 was Peter, the delta between the manufacturing costs for the relevant competing parts that we make and is that delta large enough for customers to be able eat most of the increased tariffs that we can make them eat most of the increased tariffs or will be able to pass on only part of that.
And secondly, if we were to over time move more of our manufacturing to the US from say 10 to 15 or 20 to 25, what sort of impact would that have on our overall margins over time? Just as a thought, what would that do to our overall margins?
Tanushree Bagrodia
Hi Nataj, thank you for the compliments. I think, Nataj, you know, when we talk about our competition sitting in Japan and Europe sitting on higher cost structures and the tariffs being between 15 and 50, I think I’m going to just take a step back and look at what is happening in the global scenario. Our top five, six global customers have been digging their heels into India deeper Over the last two years they are extending their teams, they are extending their procurement arms, they are constantly working on deepening their engineering and research over here. Right. So I think that’s one huge indicator that India remains an important geography of procurement for our customers and that is not changing.
Right. If at all. Customers are only increasing their team sizes over here. So I think that is one aspect. The second is some of our so called competitors are also customers to us. Right. So they’re also buying from us. And that again is something that sits in their cost structures given the fact that in their high cost based economy they will not be able to sustain the kind of margins they need to without us being there. So I think that’s the second point. I think the third point that you made was what if we move our manufacturing from India to the US Is it going to impact our margins? I’m actually just going to go back and say that Nagan, this is not an either or situation.
Right? It’s not about saying I either manufacture here or I manufacture there. It’s about saying what can I manufacture here at the best cost, what can I manufacture there at the best cost and supply to a customer in a manner which serves their needs and our goals as well. Right. And that’s the approach to take. And this has been tried and tested with a customer, Right. Where we have one program where we are manufacturing in India and the US de risking their supply chain and giving them a blended price.
Nagraj Chandrasekar
Understood. Thank you.
operator
Thank you. Next question is from the line of Praneet who is an individual investor. Please go ahead.
Unidentified Participant
Hi. Thank you. My audible.
operator
Yes, please proceed.
Unidentified Participant
Yeah, thank you for the opportunity. So I understand that we’re doing fairly well at this quarter and most of the turmoil that has happened and we also started restocking. Back to us wondering after the restock plateaus, what is the kind of growth rate we can expect from there? Because I understand that after restock, during restocking we have a mid teens or high teens worth of growth, but after that it tends to plateau. So I was wondering how do the new orders fare into the overall growth rate of the overall company? And I understand fabrication is a fairly small segment of the overall pipe today.
So I was wondering as a proportion, how was it planning, how is it going to grow and how are these all going to combine into giving us let’s say a 15% growth or what is the growth rate we can expect after all of these get added? Because as the normalized basis, without restocking and destocking, how can we look and forecast the company’s growth or whatever it is for us to get a perspective on when can we reach the 2000 crores.
Tanushree Bagrodia
Right. So Pranet, I think, you know we’ve if you looked at our growth and if you’ve looked at our performance and our past investor calls as well. Right. Our growth largely comes from the new business that we win and the new business that we win gives us the ability to continuously add to the top line and even outperform the markets. So even in the years where uniparts have regrown, we’ve actually done better in the industry segment or our customers themselves because we’ve been able to win the new business that we were talking about in the range of 190 to 200 plus crores now.
Right. And I think that gives us roughly a growth of 11 to 12%. Whereas the legacy business or the old business that we talk about is just, you know, low single digit numbers of let’s say 4%. And that then adds up to saying that we can grow in the mid teens, year on year. So I think that’s how we look at growth. That’s how we are also saying that in FY26 we are going to grow in the mid teens. So I think that was the answer to your question on growth. Sorry, I forget your second question.
Unidentified Participant
So I was wondering on how the proportions of contribution might change because fabric we want to get into a more system type of product, right. So how is going to fabrication going to fit into the overall system? Part of our goal of increasing our proportion in the vehicle. And how is the overall buy in terms of changing for fabric? What is the market size that or the revenues you can expect from the fabrication segment onto itself. And with the PMP and just continuing this question and with PMP can we also expand beyond the agri and construction? Is there other further users? I understand PMP is much bigger market, right.
So I was wondering how is it going to be because ppl is largely focused on agri and it has a cyclicality whereas PMP might negate it a little bit. So can you give that point of view also?
Tanushree Bagrodia
Right. I think here is here, Here are 2,2 data points for you. Right. Other than construction and ag, we currently also supply to the oil and gas sector. It’s a small segment of our total revenue. But there is the intent and the endeavor to grow in this segment and especially in the PMP business. And I think similarly, wherever there are adjacencies that enable us to go up the learning curve develop new products that can then enable us to deepen our wallet share. In our, I’d say home segments of off highway we also do take those businesses on, right? Because one of our new business actually that we, that we have won is in the PMP is in the industrial segment.
So I think the way to look at this is we take on, we do take on new business in the PMP segment which can help us go up the learning curve where we have the capabilities, the capacities and then we can use that to penetrate deeper in our off highway customer segment. I think that’s the way to look at the way we are growing in different segments, how we look at different segments. I think on our fabrication business again we do supply to OEMs, we do supply to aftermarket. This is a business where you know some of the attempts that we made on the on the aftermarket side have taken a little time to bear fruit.
But we remain committed to growing this business and we are seeing traction from our OEMs in extending their RFQs to this business as well. So as and when things fructify over here we will also come back to you.
Unidentified Participant
Understood. So we’ll be taking ideally.
operator
Sorry to interrupt Mr. Praneet maybe please request you to rejoin the queue sir. Thank you.
Unidentified Participant
Thank you.
operator
Next question is from the line of Viraj from Simpl. Please go ahead.
Viraj Kacharia
Yeah, thanks for the follow up. Just one question and Basically there are 23 parts to it. See if you look at your for US operations or the manufacturing setup it’s primarily for PMP whereas three pair is largely manufactured in India. Correct me what I understood now US is 55% of your own revenue mix. I understand we are on a path to diversification but that is something may play out for us in next three to four years. So question is in two three part is following one is for three PL where we primly manufacturer from India.
Even if we achieve try to achieve P and L neutral impact somewhere the OE or the customer is bearing this cost increase. So do you see or from a interaction with customer are you seeing a scenario where either for large or small equipment the demand is getting impacted? What is your reading? You know, because the cost absorption is quite sizable and we are seeing this also happening with other auto Em say Ford and others, you know already impacting their earnings. So that is one part. Second is when you look for a revenue PNN neutral impact how do you go about it pricing especially with the PNP piece be it India manufacturer or US manufacturer, you know what is Your approach in terms of pricing with the oem? These are two parts to the question.
Tanushree Bagrodia
So Viraj, I think on the AG side the question is is demand getting impacted, say the large ag business? In any case, the outlook for the year is that the large ag business is de growing. Right. High double digit declines are anyways predicted. The US market is a larger large ag market than a smaller ag market. And I think then to say is there any impact of these tariffs on the end demand? Too soon to say. Right. Because these sort of tariffs have only come in right now. So I think that’s the answer to your first question and I think what is the strategy on pricing that we did? I think it’s a very simple strategy of being completely transparent with the customer.
We have transparent contracts, transparent discussions and the fact that we’ve been able to deepen our relationship over many many years with customers is because they do value the fact that we are transparent with them. There is no other strategy to pricing.
Viraj Kacharia
So on the pricing cost increase, especially in 3 PL it will be applicable even for the smaller AC camp market. Because I mean from a conversation throughout and even from our interaction earlier with customers in Q1 when 25% was there, the costs increase at 25% straight away either the OEM or the customer, you know, it’s a sizable cost increase especially where the end demand has been for last couple of quarters in US. So just trying to understand, you know.
Tanushree Bagrodia
Sure. I think that there is for every part that they are importing from outside of the US there is a cost escalation. For anything that they are manufacturing in the US there is no cost escalation. So on a blended level they will have some amount of cost increase. But how is it impacting the end demand? Too early to say.
Viraj Kacharia
Okay, thank you.
operator
Thank you ladies and gentlemen. Due to time constraint we will take this as the last question for the day. I would now like to hand the conference over to the management for the closing comments.
Gurdeep Soni
Thanks a lot. Thank you everyone. And we continue to focus on our core strengths and build strong business franchise by strategically partnering with our customers in their journey and success. Our focus and efforts are aligned towards achieving the targeted growth in coming years. With this I would like to thank all of you for taking out the time for joining today’s call. Thank you all very much.
operator
Thank you on behalf of Go India Advisors. That concludes this conference. Thank you all for joining us and you may now disconnect your lines.