Craftsman Automation Limited has outlined a substantial ₹1,500 crore capital expenditure plan for the upcoming fiscal year, FY27. This investment will be distributed across its core segments, including Powertrain and Aluminium, focusing on greenfield projects and capacity expansion to meet growing customer demand. The company anticipates this strategic investment will drive future revenue growth and enhance operating leverage.
Craftsman Automation Outlines Significant Capex for FY27
Craftsman Automation Limited has announced a robust ₹1,500 crore capital expenditure plan for the fiscal year 2027. This strategic investment is geared towards expanding production capacities and supporting growth initiatives across the company’s key business segments, primarily Powertrain and Aluminium. The planned expenditure signals a strong commitment to future growth and meeting increasing customer requirements.
Segmental Investment Focus
The capex allocation will be strategically distributed between the Powertrain and Aluminium divisions. For the Powertrain segment, a significant portion will be directed towards establishing new facilities, including a foundry, to support the growing demand for stationary engines. The Aluminium segment will also see investment in enhancing its capabilities, particularly in high-pressure die casting for automotive parts. The company is actively pursuing greenfield projects, driven by customer demand for investment across India.
Capacity Expansion and Greenfield Projects
A key aspect of the capex plan involves establishing new plants and enhancing existing infrastructure. The company highlighted that investments in new greenfield projects will range from ₹100 crore to ₹250 crore for basic infrastructure. This includes land acquisition, building construction, and essential utilities, preparing the facilities to receive production equipment. This proactive approach is in response to customer investments and the overall positive outlook for manufacturing in India.
Financial Outlook and Strategy
The management expressed confidence that the planned capex, while significant, will be funded primarily through internal accruals, maintaining a healthy net debt to EBITDA ratio. The company believes that its current gross block and net block are substantial enough to absorb these investments without negatively impacting return ratios. Craftsman Automation anticipates that these expansions will improve operating leverage and contribute positively to its overall financial performance in the coming years. The company is also exploring opportunities to expand its capacity in response to market traction and customer needs.
Sunbeam and DR Axion Investments
Within the specific entities, Sunbeam will focus on maintenance capex. In contrast, DR Axion is slated for substantial investment, with an approved plan of around INR 430 crore for capex over a two-year period. The company has already purchased the land for this project and expects to see production starting in FY29 and FY30. Standalone capex, encompassing new Aluminium and Powertrain projects, is estimated at approximately INR 1,000 crore.
Source: BSE
