Syrma SGS Technology announced strong Q2 FY26 results with revenue of INR1,146 crores, a 37% year-over-year growth. The company also acquired a 60% stake in Elcome, a navigation and surveillance solutions provider. Syrma SGS is confident about future growth, driven by new ventures and long-term contracts, and expects improved revenue and EBITDA margins in the coming quarters.
Financial Performance
Syrma SGS Technology reported a consolidated total revenue of INR2,109 crores for the half year. For Q2 FY26, revenue reached INR1,146 crores, a 37% increase year-over-year. Export revenue for the quarter was approximately INR270 crores, a 40% increase. The ODM revenue for the quarter and half year was around 38%.
The gross margin for the quarter was approximately 23.8% and 24.3% for the half year, with a 500 bps expansion. Operating EBITDA for the quarter was around INR116 crores, representing 10.1% margin and a 56% year-over-year growth. The company’s order book position as of September is approximately INR5,800 crores, with significant contributions from the auto and industrial segments.
Acquisitions and Partnerships
Syrma SGS acquired a 60% stake in Elcome, established in 1978, which provides navigation, surveillance, and communication solutions. Elcome has a revenue of about INR200 crores with approximately 25% profit EBITDA margin. The company also has a joint venture with Elemaster of Italy and acquired KSolare, a solar inverter company with a revenue of about INR300 crores.
Business Outlook and Strategy
Syrma SGS onboarded 8 major customers in the current quarter, with a potential revenue of $100 million in the next year. The company entered into a long-term framework contract with one major customer, which has the potential to generate revenue of about $250 million over a 2-3 year period. Syrma SGS is focusing on high-margin business verticals and expanding its portfolio base.
The company expects to invest between INR60 crores to INR100 crores in capex for the remainder of the year, including investments in the PCB business. They anticipate achieving a positive cash flow of around 25% to 30% for the full year. The acquisition of Elcome and Navicom is expected to consolidate in the company’s financials in Q4.
Segment Performance
The industrial sector contributed 26% of the total business, compared to 21% in H1 of the previous year. The automotive sector contributed 24%, up from 21%. The consumer sector contributed around 32%, with plans to reduce it below 35%.
Source: BSE