Elgi Equipments (ELGIEQUIP) investor relations material

Executive summary

• Revenue for Q2 FY26 increased by 11% year-over-year to INR 9,680 Mn, with growth across most regions, though Europe remained muted and challenging.

• EBITDA margin declined to 14.9% of revenue from 16.3% last year, mainly due to increased employee costs and strategic investments, but improved sequentially from Q1 FY26.

• PBT rose 28% year-over-year to INR 1,670 Mn, driven by a one-off gain from a US property sale; excluding this, PBT was flat.

• PAT for the quarter was INR 1,214 Mn, with a PAT margin of 12.5% and improved cash position due to better receivables and inventory management.

• Board approved unaudited standalone and consolidated financial results for the quarter and half year ended September 30, 2025, with no material misstatements identified.

Financial highlights

• EBITDA for Q2 FY26 was INR 1,442 Mn, up from INR 1,419 Mn in Q2 FY25, despite higher employee and other expenses.

• Employee costs rose 15%, with 6% from normal increases, 4% from exchange rate impact, and 3% from headcount additions.

• Special initiatives in finance, IT, and HR consumed 1.2% of EBITDA.

• Net cash position improved to INR 5,316 Mn as of Sep 2025, aided by receivables and inventory management.

• Gross margin was reported at 51.9%, about 0.5 percentage points lower year-over-year.

Outlook and guidance

• Optimism for continued cash position improvement and sales growth, especially in North America and Australia, with management focused on operational efficiency and cost control.

• Europe expected to remain flat in the second half, with cost reductions to improve future profitability.

• Tariff impacts in the US are expected to be mitigated by cost reductions and price increases; further tariff reductions could improve EBITDA.

• No change in CapEx plans; ₹600 crore over five years, with ₹250 crore firmed up but delayed by 12 months due to execution issues.