Schneider Electric Infrastructure Limited received a GST penalty of ₹35,18,008 from the Chennai Commissionerate on September 9, 2026. The order stems from an audit of FY22-23 operations.

The company disclosed the receipt of the Order-in-Original vide no. 99/2026-GST (ADC) dated August 31, 2026, under Regulation 30 of SEBI Listing Regulations. The adjudication covers multiple tax demands and penalties.

Penalty and Demand Breakdown

The GST Authority imposed the penalty under Section 122(2)(a) read with Section 73(9) of the CGST Act, 2017. Interest is recoverable at applicable rates.

Key Findings in the Order

The authority confirmed demands for:

• Non-payment of IGST on export services due to non-receipt of convertible foreign exchange.
• Availment of ineligible input tax credit (ITC).
• Non-payment of GST for supplies to Special Economic Zone units without endorsement.
• Non-reversal of ITC as per credit notes reflected in GSTR2A.

The authority dropped a proposed demand of ₹67,316 relating to alleged duplicate availment of ISD credit.

What the Numbers Show

The total confirmed tax demand exceeds ₹3.8 crore, while the penalty constitutes approximately 9% of this principal demand. This structure indicates the authority treated the violations as procedural non-compliance rather than intentional evasion, which typically attracts higher penalties.

Company Response

Schneider Electric Infrastructure stated it is evaluating the order and considering appropriate legal remedies. The company asserted there is no material impact on its financials or routine business activities, limiting the impact to the liability specified in the order.

Schneider Electric Infrastructure Limited has made available the full transcript of its investor conference call, which was conducted on August 17, 2026. The session focused on the company's unaudited financial results and overall earnings performance for the first quarter ended June 30, 2026 (Q1FY27). The disclosure was issued on August 20, 2026, pursuant to Regulation 30 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015.

The transcript provides granular detail into the management's commentary on operational and financial metrics. Key highlights from the call include a record quarterly order intake of ₹915 crore, described by management as the highest ever booked in any single quarter. While year-on-year order growth stood at a modest 0.5%, sequential quarter growth was in double digits. The company also reported sales growth of approximately 5% year-on-year, characterizing Q1 as a historically soft start.

Financial Performance and Margin Pressures

During the call, CFO Omkar Prasad addressed the decline in operating profit to ₹32 crore, attributing it primarily to negative operating leverage and external commodity inflation. Management highlighted that gross margins were impacted by rising costs of raw materials such as copper, aluminum, and steel. A significant portion of the executed orders in Q1 originated from contracts booked prior to December 2025, which carried firm pricing without price variation clauses. This exposure to legacy orders limited the company's ability to pass on increased input costs to customers during the quarter.

Other expenses saw an increase due to a mix of factors, including normal salary increments effective from April 1, 2026, and foreign exchange headwinds. The depreciation of the rupee, which has depreciated approximately 8% since the start of the fiscal year, impacted dollar-denominated expenses related to imports and recharges. Finance costs remained stable, with any sequential variations attributed to non-cash accounting adjustments rather than new borrowings.

Strategic Growth Drivers and Order Book

Managing Director and CEO Udai Singh outlined four key macroeconomic pillars driving long-term demand for the company: electrification, digitalization (data centers and AI), urbanization (EV penetration and Vande Bharat trains), and the Make in India initiative. He noted that more than one-fifth of the current order book comes from emerging segments, including data centers, semiconductors, and renewables.

The company reported a strong backlog of over ₹2,100 crore, representing close to 33% growth. Management emphasized that while near-term margins face pressure from legacy fixed-price contracts, corrective actions have been initiated. These include mandating price variation clauses in new contracts where possible and implementing price hikes on standard products to mitigate future commodity inflation risks.

Capital Expenditure and Expansion

Schneider Electric Infrastructure Limited is executing a capital expenditure program of approximately ₹500 crore across its three manufacturing plants in Vadodara and Kolkata. The expansion aims to enhance domestic capacity, reduce import dependency, and cater to export markets. Management confirmed that all expansion projects are on track, with additional capacity expected to become available in the second half of the current financial year. The Kolkata plant, which began operations earlier this year, is strategically positioned to boost export revenues, which currently contribute between 10% and 12% of total revenue.

Sumit Goel, Company Secretary and Compliance Officer, signed the disclosure letter addressed to the Listing Department of the National Stock Exchange of India Ltd and the Secretary of BSE Limited. The full transcript is available on the company's investor relations website under the 'Rec' tab within the "Q1" section of the "2026-2027 Financial Results" page.