sedemac mechatronics has disclosed the receipt of GST Show Cause Notices from the Commercial Taxes Department of Tamil Nadu, demanding a total of ₹2.35 crore for the financial years 2022-23 and 2023-24. The notices, issued via email on May 20, 2026, allege short payment of tax under the Reverse Charge Mechanism (RCM), reversal of output tax on credit notes, and excess input tax credit availed. The company stated it does not anticipate a material financial impact and will file objections.

The Assistant Commissioner (Hosur South - I), Krishnagiri, issued the notices under Section 73 of the CGST/SGST Act, 2017. The department has also cited a penalty for the violation of Rule 138 for the financial year 2022-23. The total demand includes a tax component of ₹2.14 crore and a penalty of ₹21.36 lakh.

Demand Details

The department has levied a total demand of ₹2,34,96,553, comprising tax and penalty components across both financial years. The table below outlines the specific amounts demanded for each period.

Company Response

In response to the notices, SEDEMAC Mechatronics Limited stated that it will file objections and representations. The company plans to avail a personal hearing at the office of the Assistant Commissioner on or before June 9, 2026. Based on its assessment and advice from tax advisors, the company does not anticipate that the said notices will have any material financial impact on its operations.

SEDEMAC Mechatronics Limited has released its audited financial results for the quarter and financial year ended March 31, 2026. The company reported significant growth across key financial metrics, driven by robust performance in both mobility and industrial segments. Statutory auditors M/s. B S R & Co. LLP have issued an unmodified audit opinion on the results. The company published the financial results in newspapers on May 19, 2026, under Regulation 33 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. Additionally, the company has informed the exchanges that the video recording of its earnings conference call held on May 18, 2026, is now available on its website.

FY26 Financial Performance

For the full year FY26, the company achieved revenue from operations of INR 1,058.38 Cr, marking a 61% year-on-year increase compared to INR 658.36 Cr in FY25. Profit After Tax (PAT) surged to INR 103.58 Cr from INR 47.05 Cr in the previous year. EBITDA for the period stood at INR 222 Cr, up 78% YoY, with an EBITDA margin of 21.0%. The Return on Capital Employed (RoCE) for FY26 reached 40%. Earnings per share (basic) for FY26 stood at INR 23.91, compared to INR 10.93 in FY25.

The following table summarises the key annual financial metrics:

Q4 FY26 Results

In the fourth quarter of FY26, revenue from operations grew 60% year-on-year to INR 287.71 Cr from INR 179.92 Cr in Q4 FY25. EBITDA increased to INR 61 Cr from INR 29 Cr in Q4 FY25, with the EBITDA margin expanding to 21.20% from 16.11% in the prior-year period. PAT jumped to INR 32.08 Cr from INR 8.61 Cr in Q4 FY25. Profit before tax for Q4 FY26 stood at INR 41.92 Cr versus INR 12.66 Cr in Q4 FY25.

Segment-Wise Performance

The mobility segment remained the primary revenue driver, contributing INR 910.57 Cr in FY26 compared to INR 564.13 Cr in FY25. The industrial segment contributed INR 147.81 Cr versus INR 94.23 Cr in the prior year. In Q4 FY26, mobility segment revenue stood at INR 258.39 Cr and industrial segment revenue at INR 29.32 Cr. Segment results for mobility reached INR 129.98 Cr for FY26, while industrial segment results were INR 22.96 Cr.

Balance Sheet and Cash Flow Highlights

As at March 31, 2026, total assets stood at INR 813.70 Cr compared to INR 491.16 Cr as at March 31, 2025. Total equity increased to INR 449.20 Cr from INR 303.38 Cr. Net cash generated from operating activities for FY26 was INR 128.02 Cr versus INR 90.91 Cr in FY25, while net cash used in investing activities was INR 148.28 Cr. Net cash generated from financing activities stood at INR 17.65 Cr.

Operational Highlights and Corporate Developments

The company sold over 3.9 million control-intensive Electronic Control Units (ECUs) in FY26, a substantial increase from 2.4 million units in FY25. Management highlighted the widespread adoption of its sensorless Integrated Starter Generator (ISG) technology in the domestic three-wheeler market and meaningful penetration in the electric two-wheeler segment. During the year, the company completed its Initial Public Offering (IPO) of 80,43,300 equity shares at an issue price of INR 1,352 per share, with equity shares listed on NSE and BSE on March 11, 2026. The IPO comprised an offer for sale of 80,43,300 equity shares by selling shareholders aggregating to INR 1,087.45 Cr. The company also allotted 4,35,69,934 fully paid-up bonus equity shares of face value INR 10 each in the ratio of 1,499:1 by capitalising INR 43.57 Cr from securities premium. Additionally, the implementation of New Labour Codes effective November 21, 2025, resulted in an estimated one-time increase in provision for employee benefits of INR 0.81 Cr for gratuity and compensated absences, recognised as an employee benefit expense in the current reporting period.

Management Commentary and Outlook

During the earnings conference call, management noted that FY26 revenue crossed INR 1,000 Cr for the first time with a three-year CAGR of 36%. The company is investing in expanding manufacturing capacity, including a new plant (MF3) expected to commence shipments from Q2 FY27 and another facility (MF4) for electric machines starting Q3 FY27. For FY27, key growth drivers include the introduction of SEDEMAC ISG on three popular motorcycle models from top OEMs, further ramp-up of electric two-wheeler MCUs, and increased adoption of ISG ECUs for export three-wheelers. Management anticipates mild pressure on EBITDA margins due to commodity inflation and semiconductor supply chain tightening. The company also announced a business win in the power tools market with a motor controller using sensorless control technology, where production is expected to start over the next four to five quarters.