Note: This is a preliminary transcript and may contain inaccuracies. It will be updated with a final, fully-reviewed version soon.
Voltas Limited (NSE: VOLTAS) Q4 2026 Earnings Call dated May. 14, 2026
Corporate Participants:
K.V. Sridhar — Chief Financial Officer
Unidentified Speaker
Mukundan C P Menon — Managing Director
Analysts:
Aniruddha Joshi — Analyst
Umang Mehta — Analyst
Unidentified Participant
Natasha Jain — Analyst
Renu Baid — Analyst
Akshen Thakkar — Analyst
Presentation:
Operator
Ladies and gentlemen, good day and welcome to Voltas Limited Q4FY26 earnings conference call hosted by ICICI Securities Limited. 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 the conference call, please signal an operator by pressing then zero on your touchstone phone. At the time of the question and answer session. We would request participants to please limit their question to one per participant.
Please note that this conference is being recorded. I now hand the conference over to Mr. Aniruddh Joshi from ICIC Securities. Thank you. And over to you, sir.
Aniruddha Joshi — Analyst
Yeah. Thanks. Rutuja. On behalf of ICICI securities, we welcome you all to Q4FY26 and FY26 results conference call of Voltas Limited. We have with us today senior management represented by Mr. Mukundan Menon, Managing Director, Mr. K.V. Sridhar, Chief Financial Officer, Mr. Nikhil Chandrana, Head of Corporate Finance. Mr. Manish Somani, Head of Finance Controller and Ms. Sumana Tripathi, Head FP&A. Now I hand over the call to the management for initial comments on the quarterly performance. And then we will open the floor for question and answer session.
Thanks. And over to you, sir.
K.V. Sridhar — Chief Financial Officer
Good evening all. This is Sridhar here, CFO Voltas. Glad to connect with you all this evening. This is a quarter and year ended 31-3-26 results for Voltas. So Voltas delivers progressive recovery in Q4 supported by cooling segment and robust performance from the other diversified businesses to give a background on the global economy. The global economy entered 2026amid a backdrop of cautious recovery and rising uncertainty. Moderating inflation, improved financial conditions and sustained investment momentum supported economic activity during the early part of the year while global trade flows and consumption trends remained relatively resilient despite uneven recovery across regions.
However, as the quarter progressed, escalating geopolitical tensions, particularly across energy sensitive markets triggered significant volatility in commodity prices, currencies and logistics networks, further elevating input cost pressures and downsize this to global growth. Against this challenging backdrop, Voltas continue to demonstrate resilient and progressive financial improvements supported by strong domestic demand, fundamentals, structural reforms and the company’s ability to proactively navigate supply chain and operational disruptions.
Despite headwinds including delayed summer onset in select markets, global supply chain constraints and currency volatility during Q4 FY26, the company delivered a progressive recovery and continued to maintain its leadership in the cooling segment through a combination of resilient led strategy, customer centric innovation and disciplined execution. Over the last year Voltas has undertaken transformative initiatives across the B2C segment including a refreshed product portfolio, stronger manufacturing capabilities, enhanced brand investments, sharper consumer communication and deeper channel engagement.
These initiatives are now beginning to deliver tangible outcomes across operational efficiency and brand momentum. The project business also demonstrated resilience with stable execution and healthy operational performance further strengthening Voltas position as a diversified and a future ready enterprise. The agency business delivered stable performance in Q4 FY26. While the external environment continues to remain dynamic, management remains firmly focused on sustainable growth, margin resilience, disciplined execution and long term value creation for shareholders.
A brief on the financial performance for the quarter ended Consolidated Total income was 4,930 crores against 4,847 crores last year. Same period PBT was 181 against 343 crores same year last period and net profit was 113 crores versus 230236 crores last year. For the year ended 31st March 26th consolidated total income was 14,483 against 15,737 last year. PBT was 557 versus 1191 last year and net profit was 377 versus 834 crores last year. A bit of detail on the segments with regard to segment A which is the UCP segment.
Segment A was primarily driven by the RAC business where Voltas further strengthened its market leadership position. Voltas continues to deliver strong continues to lead over the number two player reinforcing the company’s strong brand equity, extensive distribution reach and consistent execution strength across markets. FY26 marked a significant transformation phase for the Volta Schooling business. The company undertook a comprehensive refresh of its RAC portfolio with sharper focus on feature led energy efficient intelligent cooling technologies and differentiated consumer experiences anchored in customer centric innovation.
We Voltas launched its Summer 2026 portfolio led by AI powered Virtus Split AC series with features like AI adaptive cooling, AI geofencing, AI Energy Manager designed for the discerning Indian consumer. This was complemented by the repositioned Har Ghar Voltas campaign which strengthened the brand’s emotional connect with Indian consumers while modernizing its appeal for younger and aspirational households. Alongside product innovation, Voltas accelerated investment records, branding, marketing, consumer communication, retail visibility, channel engagement and financial accessibility to enhance conversion and strengthen market presence across geographies.
These transformation initiatives helped Voltas deliver one of the highest ever sales months in its history. During March 2026 within segment A commercial air conditioning delivered strong performance supported by healthy mix of product and AMC business. Sustained urbanization, infrastructure investments and rapid growth in digital infrastructure continue to drive a strong pipeline for the CAC business positioning it for robust long term growth. Commercial refrigeration also delivered a steady quarter while continuing to focus on institutional sales expansion, channel development, customer diversification and introduction of new product lineups.
Cac, CR and AR continue to play an important role in deepening UCP’s diversification and reducing dependence on seasonal room cooling demand. However, margins during the quarter were impacted by commodity inflation and currency depreciation. These pressures were partially mitigated through comprehensive cost reduction value engineering program encompassing improved sourcing, deeper localization, targeted decide innovations and manufacturing efficiencies. Recent geopolitical conflicts and war related disruptions created volatility in raw material availability, logistics, energy cost and currency markets.
Voltas successfully navigated these challenges through a combination of structural preparedness and tactical agility ensuring uninterrupted production and market servicing. The company now enters the current season with a more clear defined segmentation strategy, refreshed product mix, sharper premium positioning and refreshed marketing campaign with new celebrity brand ambassadors tailored for diverse customer segments across geographies. At the same time, manufacturing investments undertaken over the last two years are now beginning to deliver tangible operational benefits.
The Chennai and Pants Negar manufacturing facilities are currently operating at better utilization levels as compared to previous year. Voltas continues to accelerate investments in factory automation, manufacturing optimization, warehouse rationalization and integrated inventory planning to further improve responsiveness, supply chain resilience and cost competitiveness. Together these initiatives are expected to deliver improved margin realization and reinforce Voltas leadership across Indian cooling space.
Voltpack Voltpack continues to play a strategic role in Voltas long term vision of building a scaled and diversified consumer durable platform with 8.6% year to date market share in washing machine segment and 6.2% in refrigerators in a sluggish market. Over the last year, Voltak has accelerated its transformation journey through sharper portfolio premiumization, deeper localization, expanded channel reach and stronger consumer engagement initiatives aimed at strengthening its position in the highly competitive home appliances market.
Continuing with its philosophy of delivering smart technology, superior cooling performance and long slanting durability, worldpec introduced enhanced products features in the Frostfeed refrigerator segment with improved energy efficiency, design aesthetics, storage innovation and consumer convenience features in the fully automatic segment machine category. The company launched innovation led product ranges featuring advanced hygiene wash technologies, NFC smart solutions and differentiated consumer centric features tailored for evolving Indian consumers.
Alongside product innovation, Goldbeck continues to strengthen its brand mix strategy supported by expanded retail presence, deeper channel penetration, enhanced in store visibility and stronger consumer engagement across key markets. These initiatives are steadily strengthening brand preference and improving conversion across channels while positioning Bolpex as an increasingly relevant player in an Indian home appliances segment. A key strategic focus during the year has been localization and manufacturing scale up at the Sahlins manufacturing facility.
The company continues to deepen localization levels across key product categories, improving sourcing efficiencies and enhance manufacturing integration to strengthen cost competitiveness and supply chain resilience. Supported by design innovations, calibrated pricing actions, improved sales mix and ongoing cost optimization initiatives, these efforts are expected to split support sustainable margin expansion while building a strong foundation for long growth going forward, Voltbeck remains focused on expanding its energy efficient and innovation led product portfolio while steadily scaling its distribution network and strengthening its position as an integral part of Voltas broader home solutions ecosystem.
Segment B Electromechanical Projects Segment B continues to play a critical role in strengthening Voltas portfolio diversification strategy, helping mitigate earnings volatility associated with seasonal nature of core cooling businesses by enforcing the company’s positioning as a diversified engineering and product solution enterprise. During FY26 the business maintained strong momentum through a sharper focus on execution discipline, selective order booking, working capital management and profitable growth across both domestic and international operations.
The domestic projects business continued to secure strategic orders while increased focus on fast track and margin accretive opportunities across high growth sectors including electronics manufacturing, industrial infrastructure, data centers, metro and tunnel projects. These sectors continue to benefit from accelerated investments driven by urbanization, digital infrastructure expansion, localization initiatives and government led infrastructure development. The businesses also prioritized timely execution and project delivery across multiple sites resulting in stronger cash flows, improved execution efficiency and enhanced profitability.
Greater emphasis on project selection, milestone based monitoring, disciplined receivables management and tighter operational controls continue to strengthen the quality of the order book and improve overall business resilience while the international project business geopolitical tensions within the international projects business, geopolitical tensions and Middle east conflict created operational disruptions across travel, logistics, site execution and commercial settlements. Despite these challenges, Voltage responded with agility and discipline by activating dedicated crisis response teams, implemented employee safety protocols, strengthened travel controls and evacuation readiness and establishing a rigorous daily monitoring framework covering critical operations, liquidity and collection management and project execution.
These measures enable the company to effectively mitigate risks while ensuring continuity across key projects and customer engagements. During FY26, the International Business Also, business witnessed healthy new order inflows further strengthening the order pipeline while improved collections, tighter controls and disciplined risk management help reduce overall risk and improve operational stability within the business. As of 31 March 2026, the total carry forward order book in Segment P stood at close to 6200 crores, providing strong revenue visibility and reinforcing confidence in the long term growth opportunities across domestic and international projects.
Business Segment C Segment C continues to strengthen the Volta’s engineering portfolio through a balanced mix of industrial equipment, after market services and long standing customer partnerships while providing stable and relatively non essential revenue streams for the company. The mining and construction equipment division delivered steady top line growth during the year supported by sustained demand for crushing and screening machinery, continuity in operations and maintenance contracts and stable performance from the Mozambique operations.
The business continued to benefit from infrastructure development activities, mining sector demand and increased focus on productivity enhancement across construction and material handling applications. Alongside equipment sales, the division continued to strengthen its aftermarket and service annuity business through deeper customer connect, improve lifecycle support and enhance service capabilities. A healthy inquiry pipeline, expanding service opportunities and stable operations across key markets provided improved visibility for future growth while reinforcing the resilience of the business model.
Within the textile Machinery division, the business operated in a challenging environment marked by geopolitical uncertainty, supply chain disruptions, rising raw material costs and cautious capital expenditure sentiment across the sector.
Unidentified Speaker
Despite
K.V. Sridhar — Chief Financial Officer
Near term market uncertainties, the business demonstrated resilience through steady execution of pending orders, strong after sales performance and continued traction in the post spinning segment. The division also continued to focus on customer retention, service responsiveness and strengthening its solutions portfolio to enhance engagement in the textile manufacturers across markets. Looking Ahead Policy support measures announced under Union Budget 2026 coupled with expansion of the PLI scheme and increased focus on domestic manufacturing are expected to support gradual recovery of the core spinning category.
At the same time, the business remains focused on accelerating growth in postpinning solutions, strengthening aftermarket service revenues and improving operational efficiencies to drive sustainable long term growth. In terms of balance sheet and working capital, Voltas continues to maintain a strong and resilient balance sheet, providing the financial flexibility required to navigate a dynamic operating environment while simultaneously supporting strategic growth investments across businesses. The company’s disciplined financial management approach combined with prudent capital allocation and tighter operational controls has enabled it to maintain a healthy liquidity position despite ongoing macroeconomic and geopolitical uncertainties.
During Q4 FY26, focused efforts on working capital optimization led to a reduction in working capital borrowings. Net working capital remained tightly managed, supported by disciplined receivable corrections, payment optimization and prudent inventory management. Inventory levels during the quarter remained moderately elevated, primarily driven by proactive readiness for the peak summer season, strategic stocking for new product launches and precautionary planning in response to supply chain volatility and geopolitical business.
However, the inventory buildup was calibrated and aligned with anticipated demand trends with gradual normalization expected as seasonal demand momentum strengthens. Overall, the company exited the quarter with a balanced and well managed working capital profile reinforced reinforcing its ability to support future growth opportunities while manufacturing financial resilience and operational agility, outlook and strategic direction in environment marked by continued geopolitical uncertainty, supply chain volatility and evolving consumer dynamics.
Voltas remains firmly anchored in strategy of disciplined growth, operational agility and long term value creation. Over the last year the company has undertaken transformative initiatives across its business and including a comprehensive refresh of its product portfolio, expanded manufacturing and localization capabilities, sharper brand positioning and fresh marketing campaign, deeper channel engagement and strong execution discipline. These strategic initiatives are now beginning to translate into cost optimizations, operational efficiency and business resilience.
With the ongoing season, the company remains optimistic about demand trends across product categories supported by improved consumer sentiment, increasing premiumization, rising organization and continued infrastructure investments. Across the cooling business, Volta’s refreshed RAC portfolio, differentiated product positioning, intelligent cooling technologies and expanded distribution reach are expected to further strengthen market leadership while driving a more favorable product mix and improved profitability.
Volttech continues to strengthen Voltas long term vision of building a scaled home appliances platform through premiumization, product innovation, deeper localization at the Sanon manufacturing facility and expanding retail and channel presence across markets. These initiatives are expected to steadily improve brand presence, market penetration and operate leverage over the medium term. Within the projects business, the company remains focused on selective order booking, execution excellence, cash flow discipline and strengthening project profitability across both domestic and international corporations.
Across businesses, cost optimization continues to remain a strategic priority with sustained focus on sourcing efficiencies, design innovation, localization, manufacturing productivity and operating leverage aimed at protecting margins and improving profitability. 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 and one on the Touchstone telephone. If you wish to remove yourself from the question queue, you may press star and 2. Participants are requested to please limit your question to 1 per participant and 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 Sukrit Patil from my side, Fintrade Private Limited.
Please go ahead.
Umang Mehta — Analyst
Good evening to the team. I have two questions. The first question to Mr. Menon is in your point of view, how is voltage preparing to capture future operations opportunities in cooling, appliances and consumer durables while thoughtfully addressing challenges such as rising competition, input cost pressures and evolving customer choices? What strategic levers do you see as most important for sustaining growth and being a market leader in the coming quarters? That’s my first question. I’ll ask my second question after this.
Thank you very much.
Questions and Answers:
Mukundan C P Menon
Yeah, good evening everyone and thank you for joining our call. I look forward to the discussion. And to answer your first question on the appliances business, as all of you know, we have a joint venture with a company called Archilic and the product is called Voltage Beko. So what this partnership, sort of the strength of this partnership is that Beko is a world leader in terms of the appliances business. So the technology, the product portfolio, the engineering, the supply chain and the manufacturing is what is what they bring to the table.
And so yeah, so the Voltas, Beko Appliances, that joint venture which we have had all the ingredients of a successful marriage between two big, I would say, I think two large organizations, one on a global scale and one the largest in India. So we use their technology and their manufacturing process and our very strong moat which is our distribution and understanding the Indian market. That is as far as the durable space is concerned, the cooling, as far as the air conditioning business is concerned, we are pretty, as you know, we have been a leader in this space for quite some time.
And the strength of a voltage brand coupled with the kind of moat we have with respect to our distribution reach is phenomenal. I think that is what we continue to leverage. You would have noticed that this year we have launched a series of new products which is more feature rich. There is a lot of new features in that. Like we have introduced a lineup with AI which essentially has features like, as Sridhar had mentioned in his initial address, like geofencing, like adaptive cooling and also energy manager.
These are features. We are always one up as far as this is concerned. And we will continue to introduce products which will keep us ahead of the curve. So I think the combination of having the right channel with a product which is always ahead of the curve is what will ensure we know the competition is severe. This is an area which has a lot of participants. Almost 60 brands operate in this space. But I think what we bring to the table is the Tata Trust plus the fact that our distribution reach is Phenomenal.
You would have also noticed that we have refreshed our entire marketing campaign this time we had earlier Voltas had a different style of marketing. This year we had onboarded two brand ambassadors, celebrity brand ambassadors, Ranbir Kapoor and Neetu Kapoor. And this is helping us in a big way in terms of that journey towards becoming an aspirational brand. So I think we have all the right ingredients to take it forward. The competition play is always there and that will continue. We do not see it receding.
Umang Mehta
Thank you. My Second question to Mr. Shiridar is as Voltage continues to benefit from demand in cooling appliances and home solutions, how are you prioritizing capital allocation between capacity expansion, RD and shareholder returns and what long term cost efficiencies are being put into place to safeguard margins amid rising input and financial costs? Thank you.
K.V. Sridhar
Okay, so I think as I highlighted in the spiel, Voltage is a fairly diversified business, as you would have seen. And I think it was more relevant this year to see the segment segregation between the three segments in terms of the profitability. So the capital allocation is done sort of fairly diligently across the segments. While we also constantly look at the any capacity enhancements where whichever needs predominantly comes in the segment A, as you can make out, but purely from any capital allocation or any investments required, we are sort of looking at all the things, segments together because it’s a fairly diversified business.
But from pure capex point of view, it’s a segment A which sort of needs periodic investments. And we are sort of doing investments from a capacity point of view, from an R and D point of view, ongoing, if you see the last two years, three years, and also this year, we plan to continue doing that. In terms of the profitability angle that you’re referring to, our focus is obviously to drive top line because what we feel is the headroom for growth within the larger cooling segment and appliances is very high for us.
We want to drive top line very, very actively. And in the process, we hope, and I’m sure we will have the efficiencies of scale where the margin profiles would sort of margin absolute will sort of keep growing and continuing to grow on an ongoing basis and give that shareholder value. So that’s the broad strategy that we are sort of trying to work on. And irrespective of the. Obviously you would have seen some geopolitical tensions over the last quarter or so, but Voltas as a company had started working on an active cost reduction program almost nine months back.
And as you see, some of these programs obviously take some time for some efficiencies to come in. But we are sort of seeing some of the benefits that we have already actioned. Sometime back we have started seeing the benefit. It’s also true that some of the benefits got offset by the inflation, inflationary measures and also the currency impact. But the continual program for cost efficiencies is something we are trying to institutionalize and make sure that we have a continuous program of cost improvements.
Channel
Umang Mehta
Thank you and best wish you.
K.V. Sridhar
Thank you. Thank you.
Operator
Thank you. Participants are requested to question. To one participant. The next question is from the line of Manoj Kohli from Aquarius Capital. Please go ahead.
Unidentified Participant
Yes, thanks for the opportunity, sir. So my question is on the margins. If we look at the reasons that we highlighted about commodity inflation and INR depreciation, but when I look at the company level, our gross margins have declined by only 85 basis points. But when I look at the segmental margins, there has been a bigger deterioration. When I look at the Unity products margins, which are close to around 3.2% for FY26 versus 8.4% in FY25. Probably how we look at the margins during FY27 and 28, given that you have highlighted about lot of measures undertaken for cost rationalization and in fact better utilizations at both the facilities.
If you can give some outlook on the margins and probably how should we model margins for FY27 and 28? That’s my first question, sir.
K.V. Sridhar
Okay, so thanks. I think a very relevant point raised. I think the margins dilution that you see in the segment A I think predominantly, as you know, we have had the discussions during the cost quarterly discussions also were predominantly sort of from the quarter one and quarter two where obviously there was a significant overhang with regard to the summer which was a bit erratic, early monsoons because of which there was a stock overhang also in the channel and also all the manufacturers and the marketeers also had.
So that was a significant impact. So from there, if you. In terms of thought process that we have had, what we have communicated is a progressive improvement in the absolute margins and also gradual improvement in the profile. So I think that is what we are actively trying to sort of work on. In terms of improvement, should it get better from the number that is sort of highlighted in FY26? Definitely it should get better. But as you can make out, some of the challenges are fairly in a way structural in the sense because of the continued issues that we are having from a supply chain angle or the currency.
So we are monitoring it extremely actively and sort of taking corrections in terms of pricing opportunities wherever we can take. We are working on all those options. We want to gradually improve the top line and the margin profile and sort of reach to a level which is closer to what it was in FY25. It’s a gradual improvement that we see at this point of time.
Unidentified Participant
Sure sir. So one question on the current environment if we look at we are already into mid summers how things have progressed during the month of April and May, also the outlook on the current season and probably how things are panning out at both secondary as well as primary level and how should we look at FY27 as a year?
Mukundan C P Menon
Yeah so Manoj, this the last year this quarter was a rather weak quarter as we know because of the weak summer and the unseasonal rains. So we have seen in comparison to that we are seeing a very positive traction in terms of the first month April and that going into May there is a serious heat wave in many parts the of of the country though there are intermittent rains and such events happening in some other some parts of the country. So very positive kind of growth we are seeing and the secondaries are also moving fast actually.
So while as all of you know there was a table change which happened last from January onwards and most of the brands including us started delivering the new table products into the channel network from the month of March which had taken a price increase Also there was a 5 to 10% price increase in 3 star and 5 star and there is a further price increase which is going on because of the commodity thing. But I think the saving grade in all this was compared to last summer. This summer the GST rate has come down from 28 to 18%.
So the impact on the there is some cushioning of the impact. There is still an impact but it’s been the enormity of that impact has been softened a little bit because of the GST reduction which couldn’t have come at a better time than now. So we are seeing very positive growth this quarter. Manoj
Unidentified Participant
Any indication on the blended price hike that we would have taken so far of the new models?
Mukundan C P Menon
Actually each model like as far as the first round of increases was concerned it was a 5% for the so blended was something something like a 7, 8% because the 3 star is a larger portion and the 5 star is around 25% 70 odd percentage is the 3 star. So a blended of 78 was only on account of the table change. There was in addition there was some other impact because of the copper and commodities going on going up even before the war started. So that also played a role. So there has been another 1 or 2% which we have further increased.
And as of now last month we had again taken an increase because of all this dollar devaluation and all the rupee devaluation and so on and so forth. So the trend is certainly on upward trajectory. But the only saving grace was that reduction in GST which was tantamount to a 7.8% on selling price. 10% reduction is equal to 7.8% on MOP. That was a welcome thing. Otherwise the entire affordability thing would have really led to a contraction of demand for we are not seeing that at all now.
Operator
Sorry. May we request Mr. Manoj to please rejoin the queue. We have participants waiting for return. Thank you ladies and gentlemen. We will request you to please limit your question to one per participant. The next question is from the line of Natasha Jain from Philip Capital. Please go ahead.
Natasha Jain
Thank you for the opportunity. Good evening gentlemen. You mentioned in your press release that March has been the strongest month for you. Now we understand that there was a lot of inventory pushing in March, broader by the industry itself. April at least in mid April it wasn’t the best of season in terms of rains. And now you mentioned that secondaries have picked up very well. But against that what at least we have seen is that primarily the still soft and in terms of the price hike also what I’ve understood is the newer price hike inventory is probably still not passed on to the trade.
So on that backdrop how do you see margins in this quarter? Given this is the most important quarter and any cost escalation from yours, do you think that may dent the demand itself for the season? Thank you sir.
Mukundan C P Menon
So the way Natasha, you said it right actually what happened was there was a. If you recall in the month of December the channel had stocked up heavily on the old table and that had taken the December, the January and the February sales were a little mellowed. March was a superb month. It was a record high in our entire business. So we hit a very high number. And April also we have almost done very close to that number. So April has also been extremely buoyant. May is also looking good in any kind of a price increase with the channel.
When there is a price increase with the channel, the first tendency of the channel is to hold back on the purchase assuming that things will come down. But when the secondary start picking up and then they feel there is a likely shortage, the secondaries start picking up. So we are seeing a similar trend in the month of May also the higher priced products are now started getting absorbed by the channel and we feel that this quarter will be a very good quarter. Natasha.
Operator
Sorry Tinchala. May we request Ms. Natasha Jain to please rejoin the queue. Thank you. The next question is from the line of Umang Mehta from Kotak Securities. Please go ahead.
Umang Mehta
Hi. Thanks for the opportunity. My question was again on margins. So from what we understand fourth quarter would have seen some old cost inventory, right? The bulk of the cost inflation which we’ve seen will likely hit you in one Q so in that context I would like to know what was the impact of this FX losses which is around 55 crores in second half. How much of it hit you in fourth quarter? How much was incremental spend on marketing or branding ambassadors that you called out and the price acts that you’ve taken?
What conviction do we have of seeing margins improve from here going forward? Thank you.
K.V. Sridhar
Okay, so on the. On the spent part. Sorry, first on the. On the old inventory, new inventory for kids. As you know we had opportunities to continue sort of selling the old inventory during the first half. So we sort of consumed pretty much the entire older inventory by around the first four to six weeks of the quarter. So and after that is when we started selling the new inventory. You are right in terms of cost, obviously the mix was there between the old and new during the quarter. So it was not entirely a new table only during the quarter.
So you’re right from that angle. As far as the impact of the. I think I’ve elaborated the fact that we have had a few rounds of corrections that have happened in terms of some of the inflationary pressures that could be used Even before the crisis that we had in the Middle east. Even then some of the commodity prices increase were there and it got sort of compounded because of substance increases and the currency devaluation in during March. So there was a multiple impacts that sort of got happened which impacted the margins for the quarter.
We had progressively sort of passing on as Mr. Menon mentioned, in terms of the pass on of the price increases that we pass on, it’s sort of settling down in terms of the price increase. I think that is where we are at this point of time in terms of the marketing. It was sort of managed within the overall marketing pool. No specific sort of. It was sort of comparable to what we have been spending from a marketing side. Nothing separate that we had to sort. I mean obviously we spent on the brand, brand ambassadors but nothing sort of out of the ordinary.
Operator
Thank you. The next question is from the line of Kur Pandya from ICICI Prudential Life Insurance. Please go ahead.
Umang Mehta
Thank you for the opportunity. Just one question on the profitability side. So you mentioned blended 5, 6% kind of price hike. I believe inflation is much higher. So just want to reconcile the your statement that will try to achieve FY25 probability is more of aspiration. So how should we see profitability journey for FY27?
Mukundan C P Menon
So essentially this blended 1 of 5% and 10% increase was purely on account of the table change, the new table products. In addition we had taken another increase for the commodity prices which had gone up pre war also. And now those as this our stock of those old materials get over. Going forward we are watching the pricing, the price increase that we are seeing is quite significant as you had rightly mentioned. And when we as well as all other brands who are in this space have to start using those new commodity prices for the products, I think this will be a pass through for most of the brands.
I do not see a challenge there. That number can be significantly higher. We don’t want to guess that number now because many of the things like the dollar, the plastics, the aluminium for example, the copper, the gas, all these are moving. Multiple moments are happening. And I completely agree that these numbers are not by any stretch of imagination a small number. They are seriously talking about double digit inflation and it will get passed through as and when the cost starts hitting us.
Umang Mehta
Understood. Just one clarification on that. So you think that you can go back to FY25 margin in FY27 itself.
Mukundan C P Menon
This is a progressive movement that we are doing. So compared to those years which was FY25. I think it will be a gradual step up. We, as Sridhar was mentioning, we are very, very clear about the overall quantum of gross margin that we generate. And being in a leadership position, we just want to sort of keep that as our goal rather than look at percentage gross margins. It’s probably not driving us. So that is the way it is. The quantum of gross margin is where we are looking at and from whatever we saw in the last financial year.
While the secondary market share is showing a little different picture. We have primary market share data which shows that between us and the next cluster of four brands actually after us, there is a gap of 5.1% between us and the next cluster of four brands. So that’s the kind of lead that we have established this year and that will hold us in good stead in terms of Overall margin, profitability, margin quantum maximization. Actually that’s the way we see it.
Operator
Sorry to interrupt. May we request Mr. Ko to please rejoin the queue. We have participants reading for the turn. Thank you. The next question is from the line of Aditya Bhatia from Investec. Please go ahead.
Umang Mehta
Hi sir, just one part again hopping on this concentration point. Have the increased costs related to wars started hitting us or do you think they’ll start impacting us in some time? And have
K.V. Sridhar
We taken any further price increase in response to that? Or do you think that post quarter margins can dip significantly before we start taking those price increases? And just a related question. In this particular quarter we have seen unallocated costs going up very sharply. So
Umang Mehta
What could be the reason for that?
K.V. Sridhar
So the first part of the question, so this quarter I think it will be a mix of the costs, some of the cost, the pre war reserves, the post again for a different reason. This will also be a mix. So it will be sort of progressive. As Mr. Menon mentioned, we have passed on certain price increases and we are monitoring the price situation also very actively. And we will be open to sort of pass on any further price increases that need to be done. As mentioned, our intent is to progressively work on the top line and the margin profile.
It will be a progressive improvement. We are not expecting any sharp downturn in terms of the margin profile for the quarter. Yeah, sorry, the second question was on the analogy. Okay. That was primarily because of the Forex impact and the mark to market from the treasury angle. Thank you.
Operator
Thank you. The next question is from the line of Reno Bed Powellia from ISL Capital. Please go ahead.
Renu Baid
Yeah. Hi, good evening team. Just a couple of clarifications. Will it be possible for you to quantify the exact price action that you have taken at 78% plus couple of price hikes, 1 to 2% in the second round. And what is the gap in terms of. You mentioned double digit price hike could be expected to fill up this gap. So a. If you can quantify these numbers. Second, can you share what was the volume for rec for us for fiscal 26. And lastly can you share with us what is the broad mix of the MEP order book between domestic and international?
Mukundan C P Menon
Yeah, so thank you. Renu. This was the first one about the price actions that we have taken. I mentioned about the new table. We have taken a 5% for the three star, a 10% for the five star and then we have output with a 2 to 3% increase for certain on account of the of the copper pricing. Copper impact. Overall, this has been increased. The next round of increase will depend on how the overall prices stabilize actually. So it depends on how the war situation goes and how the dollar react, rupee dollar goes.
So we are watching it almost on a weekly basis. So at this point in time it looks, as I said, double digit numbers. But it will all depend on how the situation goes. And it also depends on how soon the current stocks of our commodities and material that we have runs out. So based on that we will have to take price action. So difficult to say a number at this point in time. We have to purely go by how the material costs start hitting us and progressively it will get passed through. On the second thing on the volume, we have done 2.25 million units last year, which is.
This is what I said. There’s a gap of roughly 5.1% between us and the nearest bunch of four competitors. All of them are within 10,000 machines of each other. But the lead is becoming increasingly large between us and the number two group. So that is on the volume order book between international and domestic is 6200 crores. And it’s a very healthy order book that we have and with a very prudently selected order mix which will deliver very robust profitability to us going forward.
Operator
Thank you. The next question is from the line of action Thakkar from Fidelity. Please go ahead.
Akshen Thakkar
Yeah, hi sir. I had a couple of questions. I’m sorry to
Operator
Interrupt you, Mr. Thakkar. We are unable to hear you clearly. Sir.
Akshen Thakkar
Is this better?
Operator
Yes, please.
Akshen Thakkar
Sorry. On the electromechanical projects business, would you just help us understand in the international, on domestic businesses, have you had any clients call out postman Joy? That is question one. And question two was, you know, historically we’ve seen some margin volatility when material prices goes up. Any read through from the past cycles where you know, you saw metal prices move up as sharply as that. Did two questions on that and I had one more on UCT which I’ll follow up after.
Mukundan C P Menon
The second one. Thakur. Mr. Thakur. The first one was electromechanical projects. I understood what your question is. The second one is on what I think
Akshen Thakkar
The first one was our first major being this thing. And the second one was what happens to margins in that segment because you have bid level margins and then commodities have been volatile. So do you expect volatility in the margins in the project business as well?
Mukundan C P Menon
Yeah. So essentially we have not had any clients even internationally or domestic. Have any postman applied? So there is nothing of that Sort for a short period in Qatar there was the contractors were given the opportunity for using force majeure for a short period of time which got revoked. So nobody has used it and we have not affected in any which way. As far as domestic, of course, none of the. Nothing, nothing of that sort has happen and we do not see any impact on the margins for the MEP segment because one is almost like 40 to 50% of our project MEP order book in India and some of them even in international has got a proper price variation clause.
So any variation in terms of commodities, materials as well as for labor, it’s a pass through. So we do not see that impacting in any which way. So that’s in a very safe zone. There’s nothing to worry on that.
Akshen Thakkar
Excellent. One last question from my side on the jewelry product business. You know, you’ve been kind to share the kind of price hikes that have been taken and you did mention that you don’t see impact on margin spread. You know the problem for us as investors right now is to gauge what is the level of margins from which you are making that commentary. Because normative margins have been maybe eight, eight and a half. This year’s margins have been three and a half. So when you say you don’t expect margin pressure, what is the level from which you are making that commentary?
Mukundan C P Menon
Yeah. So Mr. Thakatwood, the thing as I said, the overall margin percentage profile will gradually inch up towards what we said is that number of FY25, how many quarters it takes, it depends on how the overall market essentially in this kind of thing, the demand plays a very big role. What if you were to step back for a year, for a minute and then see what is the, what brought us to that high margin profile? A good margin profile in FY25 was the demand. What caused the pain in terms of the reduction in the margin profile was again demand.
The first one was high demand, the second one was poor demand. Now this is one of the most important factors. So to my mind, the commodity volatility, the changes in the prices for all these things will generally get passed through by every single all brands including us. What will really affect is the demand. Now if the war continues and if there is an inflationary trend and the affordability of this product, there is a contraction in demand. The margin we will take much longer for us to interpret.
But if there is a summer, the impact of the summer, the affordability is not very badly affected. And the third most important variable between brands is who’s got Stocks to be able to service the channel partner. So the first two is an equalizer for everybody. The third one, we seem to be in a much better place since we are much better prepared in terms of our inventory to take care of the peaking in demand. So we seem to be at least a few steps ahead of most of the competitors and that will take positive role in that inking up as and when it happens.
But it’s a pure demand supply issue. So we’ll have to play it by that.
Operator
Thank you. The next question is from the line of Siddharth Bera from Nomura. Please go ahead.
Unidentified Participant
Yeah, thanks for the opportunity sir. First is on the AC volume. So how much was the volume for the Entire year in FY26 if you can highlight and what are you thinking about the next year and in terms of the CRM cac if you can also highlight the contribution for this quarter. And we had talked about some challenges in the CR side as well in the past. So has that sort of achieved the normal margin levels or you think it will take a bit more to improve there?
Mukundan C P Menon
Yeah. So Siddharth, last year actually the overall industry had a difficult year. So I think the industry saw a degrowth of something like 10, 12% is what the best guess is. Lastly, the primary sales of all brands put together was 14.3 million. Actually that was the total number. And this includes all the brands, the 60 brands. So out of which there are 12 of them are big brands and the rest of it is a bunch of other brands. Now projection for going forward, this will certainly expected to grow at least 15 to 20% is what we feel because the last year base was a little weak.
So that’s on the row. Mac, as far as the commercial refrigeration was concerned, last year has seen a degrowth of roughly around the industry has seen a degrowth of roughly 5%. Siddharth, if you know the commercial refrigeration is also a product which is a high impact on the intensity of the summer. For example, the product like deep freezers has got a direct relevance to the heat because the ice cream freezer demand starts peaking when the temperatures are high and it reduces when the temperatures are not as good.
So the people, even the OEMs, the big Amul, the Wadila, the have mores or the World Aru night creams. All of them stop buying freezers when they seep. The season is not going too well. Same is the case with Visicoolers. Visicoolers is a beverage cooler which we give to all for storing of beverages. And there again there is a direct linkage to the summer. So both these categories saw major dip last year and that was because of the season unseasonal rains. So here again it is a pure function of summer if the summer is strong and this year we are seeing a good summer.
So this category also is likely to grow upwards of 10% at least if not more. Commercial air conditioner is another category which has no relevance to the intensity of the summer. It’s purely a B2B business driven by the air conditioning requirement of offices, restaurants, whether it’s health clubs, spas, boutiques, all these kind of things. And then of course there is a big segment which is coming up for the commercial AC is the manufacturing sector which is growing very rapidly in India. So a lot of manufacturing play is coming in where we are getting a lot of inquiries for the manufacturing.
So this is another category which the industry will grow by at least 12 to 15%. And we as a brand are under leveraged in this and we see a huge headroom for us to grow and we are working on that. So what our CFO Mr. KB Streizer said is CAPEX requirements judiciously which we put in quite a lot of that is going into the commercial air conditioning where we see a huge headroom for us to grow. Because the kind of traction that we are seeing in this space and the fact that we are under leveraged in this is going to be a growth.
This is likely to be the next growth engine for, for voltage in addition to our core strength of the room, air conditioners and commercial refrigeration.
Operator
Thank you. The next question is from the line of Praveen Sahai from Prabhu Das Leeladar. Please go ahead.
Unidentified Participant
Yeah, thank you for the opportunity. Few you know, data points required, sir. The first is how is the channel inventory in the RAC right now? If in terms of month or days you can, you know give. Secondly, on the your order book in the project which is a 6,200 crore, how much is the domestic contribution? And thirdly, how is the Chennai facility operating at. Because you had highlighted that the utilization level has improved from last year previous year at what level of utilization?
Mukundan C P Menon
Yeah, thank you. Quickly to give you, the channel inventory is dropped dramatically. It is less than 45 days now, probably closer to 30 days. The way we see it, the order book 6200, 4500 is domestic and the rest of it is international. The Chennai actually is now built up to a capacity of 1.5 million units which is roughly 1.2 lakh machines a month is what is happening. So overall around 14 to 15 lakh is what we are doing. We have increased the capacity from one million last year to one and a half million during this year so that we can meet the demand.
And we will wait for another two years before we one to two years more before we do our next investment. We build this factory for 2 million. All that we have to do a small capex to increase the capacity from one and a half 1.5 million to 2 million. So we almost ready for that and once the demand trajectory is visible we will do that third round of investment. Right now it is delivering 1.2 lakh units a month on an annual basis roughly around 1.5 million.
Operator
Thank you ladies and gentlemen. Due to time constraints, that was the last question for today. I now hand the conference over to management for closing comments.
K.V. Sridhar
Thank you. Thanks for all your questions and the discussion. Just to summarize, as Voltas moves forward, the company remains encouraged by the strong momentum across its businesses and significant opportunities emerging across schooling, home appliances, engineering products and projects. Voltas has completed a structural transformation exercise across business vertical portfolio, product portfolio, channel expansion, cost optimization, supply chain and business processes which should help Voltas to strengthen its leadership in the cooling segment while steadily evolving into a scaled future ready foam appliances and engineering solutions enterprise.
Thank you all for the discussion. Thank you.
Operator
Thank you ladies and gentlemen on behalf of ICICI Securities Ltd. That concludes this conference. Thank you for joining us and you may now disconnect your lines. Thank you.