IFB Industries Limited held its Q3 FY’26 Earnings Conference Call on February 4, 2026. Key financials showed Revenue growth of 12% to INR1,382 crores for the quarter. Management detailed cost pressures from forex and commodities eroding PBDIT, which saw a 9.8% de-growth. Significant discussions focused on margin recovery, strategic investments in the Engineering division’s capacity, and aggressive personnel restructuring to drive profitability.
Q3 FY’26 Financial Performance Summary
For the quarter ended December 31, 2025, IFB Industries reported total Revenue of INR1,382 crores, marking a 12% growth year-over-year (YoY) from INR1,232 crores. However, PBDIT for the period declined by 9.8% to INR80.9 crores, with the margin percentage shrinking to 5.8% from 7.3% YoY. PBT was INR45.3 crores (3.3% margin), heavily impacted by an exceptional liability charge of INR13.38 crores related to the Labour Code. Consequently, Q3 PAT stood at INR24.51 crores (1.8% margin), down from INR34.36 crores last year.
For the nine-month period (YTD December), Revenue grew 12% to INR4,020 crores. YTD PBDIT margin was 6.3% (INR253.35 crores), slightly down from 6.9% last year. YTD PAT was INR99.62 crores, resulting in a 2.5% margin.
Appliance Division: Cost Headwinds and Innovation
Management acknowledged that cost innovation initiatives, totaling INR35 crores on a YTD basis, were entirely offset by negative impacts. Specifically, a 6% forex depreciation led to a INR29 crores negative impact on material costs, compounded by INR18 crores from increased commodity prices (like copper). Hedging policies cover 100% of forex exposure against the underlying.
Cost reduction efforts targeting material costs (through A&M projects) are progressing, with expected total material cost reduction for the year estimated at INR79 crores.
Market Share and Capacity
In the Appliances segment, the front-load addressable market share is around 25% plus, while top loader share is around 9.6% to 10%. Capacity utilization for front loaders is at 88% (capacity of 85,000 to 90,000 units), and top loaders operate at 90% during peak months. AC market share remains low at 3% to 3.5%.
Engineering Division Growth Strategy and Capex
The Engineering division targets growth in excess of 20% per annum. The current PBDIT margin is 14.5%, lower than previous quarters due to start-up expenses in the electronics sector. The division’s margin objective is 17% to 18% EBITDA.
The 20% growth strategy relies on a three-pronged approach: increasing share of business with existing OEMs (2-wheelers and 4-wheelers, currently a 50/50 split), entering new areas like the Gujarat EV project (planned sales of INR400 crores), and launching newer mandated products like brake discs.
Capital Expenditure Plans
Capex for the Engineering division this year is approximately INR100 crores for modernization. Broader plans include significant investments for new plants in Gujarat (Phase 1 around INR200 crores) and potential investment in Gurgaon and Bangalore, leading to a total potential capex of INR300 crores if land is purchased, which is projected to generate peak sales of INR500 crores.
Management Commentary on Restructuring and Future
Chairman Mr. Bikramjit Nag noted that project management regarding cost savings and margin improvement had been lacking internally, causing delays. The company is now aggressively restructuring personnel across branches and implementing a dedicated team approach, including utilizing McKinsey consulting, to drive efficiency.
For Appliances, the internal goal is to achieve greater than 20% CAGR over the next three years, with a minimum market share of 10% in all categories.
Regarding new categories (Refrigerators and ACs), management admitted that the initial strategy was flawed, perhaps favoring DC over higher-end products. They plan to fix the team structure and focus on improving brand recall and pricing, aiming for 10% AC market share over the next three years, which is deemed critical for staying in that business segment.
The Washing Machine division expects its full line-up (up to 14 kg capacity) to be ready by December.
Source: BSE
