Universal Autofoundry reported a 12% YoY revenue growth to ₹61.5 crore in Q2 FY27, yet posted a net loss of ₹0.6 crore. While production volume improved QoQ, rising raw material costs and higher depreciation from solar investments impacted margins. The company is actively diversifying its revenue mix away from the tractor segment toward high-growth engineering and M&HCV sectors.
Universal Autofoundry Q2 FY27 Financial Results
Revenue: ₹61.5 crore (up 12% YoY).
Net Loss: ₹0.6 crore.
Reader Takeaway: Revenue growth is visible, but rising input costs and solar investment depreciation are pressuring near-term profitability.
What just happened
Universal Autofoundry reported a topline growth of 12% year-on-year and 13% quarter-on-quarter, reaching ₹61.5 crore. Despite the volume improvement, the firm incurred a net loss of ₹0.6 crore for the quarter, bringing the H1 FY27 net loss to ₹2.2 crore. EBITDA margins were muted at 3.1%.
Why this matters
The company is in a transition phase. Gross margins declined 250 bps to 41.0% due to surging raw material prices. Simultaneously, depreciation expenses rose as the firm commissioned a new 4.8 MW solar plant in Churu, aiming to hedge energy costs in the long run. Investors are closely watching if these capital expenditures can translate into better operating leverage by H2 FY27.
Future Strategy
The management is aggressively pivoting away from the tractor segment, which currently accounts for over half of total revenue. The goal is to elevate the revenue contribution from M&HCV, construction, and engineering segments to over 75% within the next 3 to 5 years. Additionally, the company intends to grow its export revenue to 15% of the total mix.
What to track next
The firm has earmarked approximately ₹6 crore for new machinery in FY27, including VTL, Sinto, and VMC machines. Success hinges on improving capacity utilization from the current 57% toward a targeted 65% while managing the cost benefits expected from its expanded 8.4 MW solar capacity.