Craftsman Automation company name released the transcript of its earnings conference call held on July 30, 2026, discussing its unaudited financial results for the quarter ended June 30, 2026 (Q1FY27). The discussion highlighted a significant capital expenditure plan of approximately ₹1,500 crore for FY27, driven by expansion in powertrain and aluminium segments. Management emphasized that the aluminium segment is on a strong growth path, outpacing other business units due to recent massive investments and capacity additions. This strategic positioning aims to capture increasing demand in both two-wheeler and four-wheeler sectors.

The conference call was conducted pursuant to Regulation 30 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015. The transcript was filed with the Bombay Stock Exchange (BSE) and the National Stock Exchange of India Limited (NSE) on August 4, 2026, by Shainshad Aduvanni, Company Secretary and Compliance Officer. Investors can access the recording via the company’s official investor relations website.

Capital Expenditure Breakdown

Chairman and Managing Director Srinivasan Ravi detailed the capex allocation across the group’s entities. The standalone company plans to spend over ₹1,000 crore, primarily focused on infrastructure development for new locations to follow key customers. DR Axion, a subsidiary, has an approved capex plan of ₹430 crore, though spending may spill over into the next financial year depending on order traction. Sunbeam’s capex will be limited to maintenance and minor capacity building.

Ravi noted that infrastructure costs for greenfield projects have risen significantly, with land and basic setup costing between ₹150 crore and ₹250 crore per plant. He stated that funding will come from internal accruals, maintaining a healthy net debt-to-EBITDA ratio without accessing public markets.

Segment Updates and Turnarounds

In the aluminium segment, management reported operating at more than 80% capacity utilization. Ravi indicated that growth in this segment will continue for several quarters as new capacities mature. The powertrain segment is averaging around 70% utilization, with seasonal peaks expected to push it closer to 80% during festive periods. A new initiative in heavy horsepower stationary engines is targeted to reach USD 100 million in revenue by FY29-FY30, with production starting in FY28.

Sunbeam is undergoing restructuring, which is expected to be 90% complete by December 2026. Management anticipates exiting legacy, negative-margin businesses while replacing revenue through new customers. Ravi projected that Sunbeam could achieve mid-teens EBITDA margins by Q4FY27, despite a potential 10-20% reduction in top-line revenue from exited units.

What the Numbers Show

The disclosed capex figures signal a shift towards aggressive infrastructure-led growth. With standalone capex exceeding ₹1,000 crore and total group spend nearing ₹1,500 crore, Craftsman Automation is preparing for substantial capacity expansion. The reliance on internal accruals suggests strong cash flow generation, while the focus on following customers to new locations indicates a strategy to deepen client relationships and secure long-term contracts. The turnaround at Sunbeam, targeting mid-teens EBITDA margins, represents a key margin accretion opportunity if executed as planned.

Craftsman Automation reported a consolidated net profit of ₹150.55 crore for the quarter ended June 30, 2026 (Q1FY27), marking a 116.3% year-on-year increase from ₹69.60 crore in Q1FY26. The significant profit surge was driven by a 36.3% rise in consolidated revenue from operations to ₹2,431.58 crore, reflecting robust order conversion and improved capacity utilization across its key business segments. This performance underscores the company's ability to leverage scale, with EBITDA margins stabilizing at 17% while net profit margins expanded from 4% in Q1FY26 to 6% in Q1FY27.

The unaudited financial results were reviewed by statutory auditors Sharp & Tannan and approved by the Board of Directors on July 29, 2026. The company published the results in The Hindu BusinessLine and Dinamani on July 30, 2026, pursuant to Regulation 47 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. Additionally, the company released an investor presentation detailing its strategic roadmap and segment-wise performance under Regulation 30 and Regulation 46.

Financial Performance

Consolidated revenue from operations stood at ₹2,431.58 crore in Q1FY27, compared to ₹2,226.40 crore in the preceding quarter (Q4FY26) and ₹1,784.00 crore in Q1FY26. Other income contributed ₹23.08 crore, bringing total income to ₹2,454.66 crore. Total expenses were ₹2,254.26 crore, comprising cost of sales and services of ₹1,457.74 crore and employee benefits expense of ₹165.70 crore.

Profit before tax reached ₹201.02 crore, up from ₹93.71 crore in Q1FY26. After accounting for tax expenses of ₹50.47 crore (current tax ₹41.20 crore and deferred tax ₹9.27 crore), net profit for the period was ₹150.55 crore. Basic earnings per share (EPS) rose to ₹62.25 from ₹29.18 in the corresponding quarter last year. EBITDA grew by 51% YoY to ₹408 crore, demonstrating strong operating leverage.

Segment Analysis

The Aluminium Products segment remained the primary revenue driver, contributing ₹1,479.34 crore (60.8% of total revenue), up from ₹1,071.28 crore in Q1FY26. This segment delivered an EBIT of ₹150 crore, a 39% increase from ₹108 crore in Q1FY26. The Powertrain segment generated ₹622.55 crore in revenue with an EBIT of ₹114 crore, up from ₹76 crore YoY. Industrial & Engineering revenue grew to ₹329.69 crore from ₹216.31 crore, with segment results improving significantly to ₹30 crore from ₹5 crore, marking a 500% surge in profitability.

Strategic Developments

The Board approved setting up a new plant at Komaranapalli Village, Krishnagiri District, Tamil Nadu (Hosur Unit - 3). The project aims to cater to incremental demand from automotive OEM customers in Southern India. Phase I requires an estimated investment of ₹100 crore, with Phase II estimated at ₹150 crore. Financing will be through term loans and internal accruals. The facility is expected to be commissioned within 6–8 months.

Additionally, the Board appointed Santosh Kumar Singh, Senior Vice President - Operations, as Senior Management Personnel effective July 29, 2026. Mr. Singh brings over three decades of experience in manufacturing and operations, including senior roles with Indian Railways.

What the Numbers Show

The disproportionate growth in net profit (116.3%) compared to revenue growth (36.3%) indicates significant operating leverage. This margin expansion is largely attributable to the Industrial & Engineering segment, where results jumped from ₹5 crore to ₹30 crore despite only a 53% increase in revenue. Furthermore, the absence of exceptional items in Q1FY27, compared to a loss of ₹8.24 crore in Q1FY26, provided a tailwind to the bottom line. The company also raised ₹2,000 crore via a Qualified Institutions Placement (QIP) during the quarter, with ₹912.08 crore remaining for future utilization towards debt repayment and corporate purposes.