SYRMANSESeptember 30, 2025

Syrma SGS Technology Limited

8,146words
102turns
14analyst exchanges
6executives
Management on call
J. S. Gujral
MANAGING DIRECTOR – SYRMA SGS TECHNOLOGY LIMITED
Jayesh Doshi
DIRECTOR – SYRMA SGS TECHNOLOGY LIMITED
Satendra Singh
CHIEF EXECUTIVE OFFICER – SYRMA SGS TECHNOLOGY LIMITED
Bijay Agrawal
CHIEF FINANCIAL OFFICER – SYRMA SGS TECHNOLOGY LIMITED
Nikhil Gupta
HEAD, INVESTOR RELATIONS – SYRMA SGS TECHNOLOGY LIMITED
Bhoomika Nair
DAM CAPITAL ADVISORS LIMITED
Key numbers — 40 extracted
rs,
ll of activities and a lot of positivity. While we achieved record EBITDA, profit margins, turnovers, what was more significant in this quarter is the slew of tie-ups and joint ventures, which we have
60%
als where we had a very minimal presence. Now we are very happy to announce that we have acquired 60% stake in Elcome, which is almost a 50-year-old company was established in '78 and provides naviga
INR200 crore
itary and private sector. It has a very good reputation in the market and has a top line of about INR200 crores with a profit EBITDA margin of about 25%, 24%. And we expect that
25%
op line of about INR200 crores with a profit EBITDA margin of about 25%, 24%. And we expect that this acquisition would in the coming years show a very good growth and w
24%
ne of about INR200 crores with a profit EBITDA margin of about 25%, 24%. And we expect that this acquisition would in the coming years show a very good growth and will b
INR300
ng with Premier. It's a decade or 15-year-old company into solar inverters has a revenue of about INR300-odd crores. And the solar market is growing. So Syrma and KSolare have tied up to manufacture the
100 million
rrent quarter, we have onboarded 8 major customers, which have a potential of giving revenues of $100 million in the next year. In addition to that, we have now started focusing on long-term framework contra
250 million
h contract with one of our major customers, which has the potential of giving a revenue of about $250 million over a 2-, 3-year period. Going forward, we would be strategizing to sustain this momentum of lon
INR2,109 crore
2025. I can start with the consolidated total revenue. For the half year, we did approximately INR2,109 crores of total revenue. And for the quarter ending September 2025, we did INR1,146 crores of revenue,
INR1,146 crore
proximately INR2,109 crores of total revenue. And for the quarter ending September 2025, we did INR1,146 crores of revenue, which is a growth of 37% on a year-on-year basis. This robust growth for the period
37%
nd for the quarter ending September 2025, we did INR1,146 crores of revenue, which is a growth of 37% on a year-on-year basis. This robust growth for the period is contributed by higher growth in aut
INR270 crore
er growth in auto, industrial and IT segment. Our export revenue for the quarter is approximately INR270 crores, which is again grown by 40% on a year-on-year basis. And for the half year, it is around INR502
Guidance — 20 items
J. S. Gujral
opening
“While the figures for the quarter and the half year will be explained by Bijay in detail, I would like to dwell on the macro level scenario.”
J. S. Gujral
opening
“And we expect that this acquisition would in the coming years show a very good growth and will be margin accretive to the company.”
J. S. Gujral
opening
“The PCB project, which we are setting up since our last call, we have got the ECMS approval from the Government of India.”
J. S. Gujral
opening
“And the project has already been approved by the Andhra Pradesh government, and we should be breaking ground for construction in the coming months, somewhere in December.”
J. S. Gujral
opening
“So we are very confident that going forward, this project and this sort of diversification would help us to not only expand our revenues, but also be margin accretive.”
J. S. Gujral
opening
“These will be manufactured at our Pune facility and we expect a good revenue traction coming out of this in the coming year.”
J. S. Gujral
opening
“For the current quarter, we have onboarded 8 major customers, which have a potential of giving revenues of $100 million in the next year.”
J. S. Gujral
opening
“Going forward, we would be strategizing to sustain this momentum of long-term contracts so that the growth visibility for the future becomes more clearer.”
J. S. Gujral
opening
“And next year would see an incremental jump in revenues and EBITDA margins.”
Bijay Agrawal
opening
“Coming to capex for the half year, we had spent around INR45 crores during the H1 of this year, and we expect to invest around INR60 crores to INR100 crores, including my investments towards the PCB business also in the balance of the year.”
Risks & concerns — 3 flagged
One, in Q2, we've seen the slowdown on the industrial segment sales to I think about 9%, 10%.
— Ankur Sharma
If you could just help us understand what's driving that slowdown?
— Ankur Sharma
And we have the technology, and I don't see a challenge in that.
— J. S. Gujral
Q&A — 14 exchanges
Q
So a couple of questions. Firstly, given how 2Q or, let's say, 1H has panned out, are we sticking to the 30% to 35% revenue guidance from an organic perspective for the full year? And also if you can update your EBITDA margin guidance given that we have done extremely well in the first half?
Bijay Agrawal
Bhavik, I request if you can repeat your question. I think there was some problem in your voice. The question was that given how 1H has panned out so far, are we sticking to the 30% to 35% top line guidance for FY '26? And also if you can update the EBITDA margin guide given 1H has been extremely strong? Okay. See, on the turnover, we stand by 30% approximately growth esimates, give or take a couple of percentage points here or there. On EBITDA, we had guided 8.5% to 9% and seeing the performance for the first half year, which is now 10%, we are very confident that we'll be able to exceed the
Q
A couple of questions here. So we're just talking about revenue increase sequentially, but gross margin declined. So my guess is some sort of a mix issue or something did not -- one of the high-margin verticals did not go as per plan. If you can address that? Then also talk about kind of EBITDA margin increased sequentially. Is there -- you obviously saw some operating leverage. Was there anything onetime there? Or is that sustainable? And then I have a couple of follow-up questions.
Bijay Agrawal
So if you are sequentially comparing Q2 gross margin versus Q1 gross margin, there is a slight difference, but that is because of the business mix because in Q2, IT business has taken a larger portion near about 5% of my total business in Q2. That is where we see there is a slight bit of mix change and some impact on the overall gross margin. But overall EBITDA margin-wise because that comes at a very low cost on the low operating cost. So that is why overall EBITDA margin further remains same Q1 versus Q2. Sameet, on annualized basis, we sort of -- there could be marginal variations quarter-o
Q
A couple of questions. One, in Q2, we've seen the slowdown on the industrial segment sales to I think about 9%, 10%. If you could just help us understand what's driving that slowdown? And more importantly, how do you see sales for the full year?
J. S. Gujral
Again, we don't -- we are mindful of Q-on-Q things. But sort of on an annualized basis, we are very confident on our industrial portfolio and which has grown very decently in the half year, about 30% in the half year and which is, I think, a robust growth despite the American tariffs and other things. So we believe that industrial portfolio would continue to be a mainstay of growth and profitability. And the contracts which I was alluding to that we had entered the orders which we have got from some new customers, they are spread across industrial vertical also in the power management, power d
Q
Sir, congratulations on the good set of numbers. Sir, my first question on the -- if you can give us a little picture on the x of acquisition, Syrma, where does the growth lies in which segment? And what are the TAM are we looking for and the growth avenues for Syrma itself apart from the acquisitions that we have done?
J. S. Gujral
Okay. You see about defense acquisition is a new vertical. PCB is a backward integration and new vertical. Elemaster is into railway, so it's part and parcel of our existing portfolio and so is the renewable energy. Now if I were to only talk of excluding the defense and the PCB venture, we still believe that we are in a position to deliver superior growth in the coming years than what we have achieved this year thus far. I hope that clarifies the thing. And this would primarily be driven by industrial, automotive, including EV, renewable, the solar business would grow. It would add a decent a
Q
I have few clarifications. First, if you can quantify what was the PLI incentives...
J. S. Gujral
Your voice is not clear, sir. Can you speak a bit loudly? Your voice is not clear. First, I wanted to check if you can quantify what was the PLI incentive we booked in this quarter and what was -- and for the same quarter last year? Okay. Bijay? So PLI is something which is part of normal income telecom business and is what we are accruing here. For the financial year, generally, we have already guided it should be in the range of around INR20 crores to INR25 crores on net basis. And quarter specific numbers, we are yet to check what is exactly there in that. But it's in line with the revenue.
Q
I was asking on smart meter, how much revenue we did in this quarter?
J. S. Gujral
Just hold-on. I think Bijay will pull out the details, but I think we did about 4 million units of smart metering. We did approximately INR50 crores in this quarter. Okay. If I remember it correctly, we had a target of roughly INR250 crores to INR300 crores from this piece of segment. Are we on track to achieve our full year guidance on smart meter? We are on full track. These are quarter-on-quarter variations would always be there. So broadly, we are targeting near about INR300 crores plus from the smart metering business. That's where we are already there on that track. We have also onboarde
Q
See, PCB industry typically works at 1, 1.2 of the gross fixed assets, 1.5 max-max. So if we are targeting an investment of about INR1,500 crores, so the max revenues, which we can expect from the business would be INR2,500 crores. Sonali Salgaonkar Understood. Sir, and sort of -- I know it's a bit too early, but from the point of view of usage of your production, would you be targeting customers domestically or to the exports? And sort of which segment will you be targeting on?
J. S. Gujral
Okay. See, this is something very, very exciting for us and the number of calls which our teams have been receiving from big companies in India who want to indigenize their supply chain of the PCB. And I'm talking of big multibillion-dollar groups who are showing interest that when is the plant going on stream. And these groups have usage in automotive, industrial, health care all around. So in the short term, the way we are planning is that we would be catering to the domestic market. And it has a certain time approval, the process approval, the product approvals take place. But going forward
Q
Sir, my first question is related to receivables. In this quarter or in the first half, if I look at, your receivable has increased significantly. So will that going forward in a year going to normalize?
J. S. Gujral
See, I wish everything would be normal in all the quarters. But on an annualized basis, that was on a lighter vein. This is a work in progress. So clearly, we have sort of exceeded the target what we had set to ourselves for working capital allocation or utilization. We are very confident that by the year-end, as Bijay had alluded in his commentary that we would be able to bring down the net working capital to below 65 days and receivables are a big chunk of that. So we are very confident in all these are big companies and you can see if a INR200 crores payment gets delayed by 5 days, your mon
Q
Just continuing the question of the previous participant. Our working capital and within working capital, if I were to break it down, receivables have increased quite sharply, maybe 80% year-over-year versus 40% growth we've had in revenues. So what specifically led to such a high jump in receivables in particular?
J. S. Gujral
Obviously, the collections have lagged the sort of sales. And to me, internally and to me personally, managing receivables is comparatively the easier part of the working capital cycle management than managing inventories. So some sense of satisfaction in an otherwise sort of working capital sort of abnormality or thing, we have been able to control the inventories well and the task is cut out to control the receivables. And I'm very confident that when we meet somewhere in January or whatever when we announce the Q3 results, you will see a significant change in the receivables position. Yes,
Q
Sir, your margins have remained quite resilient this quarter despite the overall revenue mix shifting towards some low-margin businesses. So could you elaborate on what is driving this resilient margins? Is there any underlying efficiency or cost factors at play?
J. S. Gujral
The margins are, by and large, again, we don't look at margins quarter-on-quarter because if the product mix changes, the margins for a particular quarter would take a sort of positive or negative variation. Once my business has now stabilized with almost all the verticals being at the levels at which they were budgeted to be, I personally don't see any significant variation in the gross material margins going forward. When my health care and exports pick up, there would be an uptick in the margins. So my gross material margins continue to be hovering around 24%, 24%.. And therefore when the c
Q
Congrats on a great set of numbers. Sir, quickly on the JV with Shinhyup, which you have signed for PCBs, wanted some clarity on the HDI side because as far as my understanding goes, Shinhyup doesn't have much capability on HDI side, but what are your thoughts on that? Do they manufacture HDIs or it's only multilayer as of now?
J. S. Gujral
They manufacture multilayers and HDIs also. So HDIs will be starting to manufacture '27-'28 onwards. And we have the technology, and I don't see a challenge in that. Right, sir. And yet to receive approval for that, right? In coming months we'll receive approval for HDI also, right? We have applied for it. That's a separate set of applications because the multilayer PCB that only the PLI, no capex incentive. The HDI and other things have a capex incentive. So that set of applications is always already with the government. So I think we'll see the approval of that in coming days. And our object
Q
Sir, on the PCB project front, as you highlighted, the first phase would be INR800 crores capex. How about the second phase? When should we expect that to start? And secondly, how are the incentives on the state and central government and how -- what lag they will flow in?
J. S. Gujral
See, the state capital incentives of 50% of the amount spent, in the Phase 1, we will be spending approximately immediately INR40-odd million and then INR90-odd million in total, which would cover my multilayer line. The next INR800-odd crores will be spent on CCL and HDI. The state incentives work on an annualized basis. So whatever I spend after I have spent, I get it approved and will be given in the subsequent year. So I believe that the state capital incentives should come back to us in the financial year '27-'28 for the amount spent between now and March '27. Okay. Got it. And when you p
Q
Thank you, ladies and gentlemen, for sparing time for the Q2 earnings call of Syrma SGS. To sum up, I think we have never been so gung-ho about the business with the government policies in support and the state vying for attracting investments. I think the EMS industry is entering the second phase. The first phase was establishing itself. So I think going forward in the coming years, the electronic manufacturing industry would be one of the pillars of the growth of India. And we are fortunate, Syrma SGS is fortunate to be present at that cusp of time when this is seeing a huge demand. We are v
Management
Q
Thank you, everyone. Thank you.
Management
Speaking time
J. S. Gujral
36
Moderator
15
Bijay Agrawal
14
Naushad Chaudhary
6
Veenit
5
Ankur Sharma
4
Bhavik Mehta
3
Praveen Sahay
3
Vipraw Srivastava
3
Keshav Lahoti
3
Opening remarks
Bhoomika Nair
Yes. Thanks. Good morning, everyone. On behalf of DAM Capital, I welcome you to the Q2 FY '26 Earnings Call of Syrma SGS Technology Limited. We have the entire management of the company with us. At this point, I'll hand over the floor to Nikhil Gupta, Head of Investor Relations of Syrma to take the proceedings forward. Over to you, Nikhil.
Nikhil Gupta
Thank you, Bhoomika. Hi, everyone. A very good morning to you all. Welcome to Syrma SGS Second Quarter Financial Year 2026 Earnings Call. We have with us today Mr. J.S. Gujral, Managing Director; Mr. Jayesh Doshi, Director; Mr. Satendra Singh, Chief Executive Officer; and Mr. Bijay Agrawal, Chief Financial Officer, Syrma SGS, to discuss the performance of the company during the second quarter of the financial year 2026, followed by a detailed question-and-answer session. During this call, certain statements that will be made are forward-looking, which involve several risks, uncertainties, assumptions and other factors that can cause results to differ materially from those in such forward-looking statements. We request you to kindly refer to the disclaimer statements as presented in the earnings release for the same. With this, I now hand over the call to Mr. J.S. Gujral, Managing Director, for his opening remarks on the performance. Thank you.
J. S. Gujral
Good morning, ladies and gentlemen. A very warm welcome to all of you. Q2 has been a quarter full of activities and a lot of positivity. While we achieved record EBITDA, profit margins, turnovers, what was more significant in this quarter is the slew of tie-ups and joint ventures, which we have executed. And I think these joint ventures and tie-ups lay the foundation for the sustained future growth in the years to come. While the figures for the quarter and the half year will be explained by Bijay in detail, I would like to dwell on the macro level scenario. As we have been always communicating that we would be going in for inorganic expansions in verticals where we were not present, and defense has always been highlighted as one of the verticals where we had a very minimal presence. Now we are very happy to announce that we have acquired 60% stake in Elcome, which is almost a 50-year-old company was established in '78 and provides navigation, surveillance, communication and such solut
Bijay Agrawal
Thank you, Mr. Gujral. Good morning, everyone. I'll now quickly take you through the brief summary of financial performance for the quarter and half year ended September 2025. I can start with the consolidated total revenue. For the half year, we did approximately INR2,109 crores of total revenue. And for the quarter ending September 2025, we did INR1,146 crores of revenue, which is a growth of 37% on a year-on-year basis. This robust growth for the period is contributed by higher growth in auto, industrial and IT segment. Our export revenue for the quarter is approximately INR270 crores, which is again grown by 40% on a year-on-year basis. And for the half year, it is around INR502 crores, which is again a 35% growth on a year-on-year basis. Our ODM revenue for the quarter and for the half year is around 38%. On the customer concentration, my top 10 customer contributes here about 56%, 57% of my total revenue and top 20 customers here about 72%. When we see this overall business mix w
Satendra Singh
Thank you, Bijay, and thank you, Mr. Gujral. As always, I'd like to start my remarks by thanking the customers whose trust over decades has brought us here, and we would continue to do everything in our part to continue to delight them over the next decade. We had a stellar quarter with organic growth of 37% and almost 53% growth in EBITDA, in addition to the inorganic moves, which Mr. Gujral already alluded to. This is possible only with the wholehearted support and efforts of all our team of almost 10,000 colleagues in the plant and the offices. So I would definitely like to thank them once again for all their efforts to delight our customers and the investors as well. There are 3 elements of excellence: people, strategy and execution. We continue to focus on all of them and which is what is resulting into the results, which we reported just now. On people side, we continue to augment the leadership capabilities, and we brought in a new leader on the digital and information systems.
← All transcriptsSYRMA stock page →