Sandhar Technologies FY26: Revenue Surges, But Profit Margins Narrow

Sandhar Technologies Limited announced its fiscal year 2026 (FY26) results, revealing a significant 25% increase in consolidated revenue from operations, reaching approximately ₹4,852 crore (INR 48,521 million). This marks a substantial rise from FY25's revenue of approximately ₹3,884 crore (INR 38,845 million).

Key Financial Highlights

The company reported consolidated earnings before interest, taxes, depreciation, and amortization (EBITDA) of ₹438 crore (INR 4,376 million) for FY26, up from ₹383 crore (INR 3,832 million) in FY25. Despite the revenue and EBITDA increase, the EBITDA margin slightly contracted to 9.0% in FY26 from 9.9% in FY25. The company's net adjusted leverage increased to 2.5 times in FY26 from 2.2 times in FY25, while its interest coverage ratio decreased to 6.4 times from 6.8 times.

Strategic Context and Future Outlook

Sandhar Technologies, a diversified automotive component manufacturer, has focused on expanding its product range and market presence, partly through acquisitions and capital investments. Recent significant order wins from TVS are expected to boost future revenues starting in FY27. The company projects revenue growth of 10%-15% for FY27 and anticipates its EBITDA margins to improve to between 9.1% and 9.2%. A positive free cash flow generation is also expected in FY27.

Potential Risks

Key concerns for investors include the company's concentration in the two-wheeler segment and its reliance on a few major customers. The profitability of its overseas subsidiary, Sandhar Technologies Barcelona S.L., remains a point of watch. Additionally, Sandhar Technologies may need to continue providing financial backing to its subsidiaries and joint ventures, which could affect consolidated financial results.

What to Watch Next

Investors will closely monitor Sandhar Technologies' ability to meet its FY27 revenue growth targets and achieve the projected EBITDA margin improvements. The generation of revenue from new TVS orders and the successful attainment of positive free cash flow will be critical indicators of the company's near-term financial health. The performance of its international operations and any changes in its debt levels will also be important factors.