Elecon Engineering Company (505700) Q3 24/25 earnings summary

Executive summary

• Q3 FY2025 consolidated revenue grew 12% year-on-year to ₹529 crores, with EBITDA at ₹143 crores and PAT at ₹108 crores, reflecting strong operational performance.

• MHE division posted 71.9%-72% YoY revenue growth in Q3FY25, while Gear division saw marginal 2.1% YoY growth due to sluggish domestic demand.

• Overseas/international business contributed 27% of 9MFY25 revenue, with a strategic goal to reach 50% by FY30.

• Order book as of December 31, 2024, stood at INR 684 cr, up from INR 572 cr a year ago.

• Revenue guidance for FY2025 revised downward by 3%, but EBITDA margin guidance of 24% maintained.

Financial highlights

• Q3 FY2025 consolidated revenue: ₹529 crores (up 11.7%-12% YoY); 9MFY25: ₹1,429 crores (up 4.1%).

• Q3 EBITDA: ₹143 crores (margin 27%, up 150 bps YoY); Q3 PAT: ₹108 crores (margin 20.3%, up 120 bps YoY); 9MFY25 PAT: ₹269 crores (up 6.6%).

• Gear division 9MFY25 revenue declined 3.6% YoY to ₹1,149 crores; MHE division 9MFY25 revenue surged 71.9% YoY to ₹280 crores.

• Order intake for Q3FY25 rose 20.7% YoY to ₹1,735 crores; open order book as of Dec 31, 2024, stood at ₹1,105 crores.

• Net free cash surplus exceeded INR 500 crores as of December 31, 2024.

Outlook and guidance

• FY2025 revenue guidance expected to be missed by 3% due to sectoral and macroeconomic headwinds; EBITDA margin for FY2025 expected to be maintained at 24%.

• Management optimistic about MHE division and expects strong Q4 performance and continued momentum.

• Focus remains on expanding overseas revenue share and enhancing product offerings.

• FY2026 guidance to be provided in April; early signs indicate a strong start, especially in Q1.