Surya Roshni (SURYAROSNI) Q1 25/26 earnings summary

Executive summary

• Q1 FY26 consolidated revenue was INR 1,605 crore, down 15% YoY, with EBITDA at INR 83 crore, a 48% decline, and EBITDA margin at 5.14% versus 8.37% last year, impacted by softer commodity prices, muted government project execution, and early monsoon.

• SAP HANA implementation in the Steel Division caused initial disruptions, resulting in sales loss of 25,000-30,000 metric tons (INR 180-200 crore).

• Steel Pipes segment faced revenue and margin pressure from slower government project execution, early monsoon, and lower steel prices, though exports grew strongly in double digits.

• Lighting & Consumer Durables segment saw modest revenue growth, driven by double-digit volume increases in LED lamps, battens, water heaters, and mixer grinders, despite pricing pressures.

• Despite top-line and margin pressure, a healthy order book and diversified business mix support recovery expectations for coming quarters.

Financial highlights

• Q1 FY26 revenue: INR 1,605 crore (down 15% YoY); EBITDA: INR 83 crore (down 48% YoY); PAT: INR 34 crore (down 64% YoY).

• Lighting and Consumer Durable segment revenue: INR 397 crore, up 3% YoY; EBITDA: INR 31 crore (down 12% YoY).

• Steel pipe and strips revenue: INR 1,207 crore (down 20% YoY); EBITDA: INR 52 crore (down 58% YoY); EBITDA per ton: INR 2,922 (down 52% YoY); volumes down 13% YoY; export volumes up 23% YoY.

• Gross profit margin for Q1 FY26 was 23%, down from 24.2% in Q1 FY25.

• Net cash surplus of INR 331 crore as of June 30, 2025.

Outlook and guidance

• Double-digit growth guidance maintained for Lighting Division, supported by capacity expansion, new products, and government alignment.

• Steel segment expects 35-40% growth in Q2, with volume and revenue recovery as order execution picks up and new capacities come online.

• Management remains confident in achieving FY26 volume guidance of 1.05 million tons, with strong order book and capacity ramp-up.

• Margins in Lighting & Consumer Durables expected to recover in coming quarters.

• Strategic focus on value-added products, new launches, and manufacturing expansion to drive growth.