Elecon Engineering Company Limited , one of Asia's largest industrial gear manufacturers and material handling equipment providers, has announced robust financial results for the first quarter, along with a significant legal development.

Financial Highlights

Elecon Engineering reported a consolidated revenue of ₹491.00 crores for Q1, marking a healthy 25% year-on-year growth. The company's EBITDA stood at ₹130.00 crores, with an EBITDA margin of 26.60%. Notably, the profit after tax (PAT) for the quarter reached ₹175.00 crores, including exceptional items.

Segment Performance

Gear Division

The Gear division showed resilience with a 6.10% year-on-year growth, generating revenue of ₹357.00 crores. However, the EBIT margin for this segment decreased to 18.40%, impacted by increased employee costs, brand-building activities in overseas markets, and accelerated depreciation on recently capitalized assets.

Material Handling Equipment (MHE) Division

The MHE division delivered a strong performance, with revenue surging by 138.90% year-on-year to ₹133.00 crores. This division's EBIT saw a remarkable growth of 334.60% compared to the same quarter last year, with the EBIT margin improving from 25.30% to 46.00%.

One-Time Income and Exceptional Gain

The company's financial results were boosted by two significant one-time items:

1. An arbitration claim settlement in the MHE division, contributing ₹35.00 crores (₹25.00 crores in Revenue and ₹10.00 crores in Other Income).
2. An exceptional gain of ₹80.00 crores (net of tax) from the reclassification of investment in EIMCO Elecon (India) Limited.

Strategic Outlook

Prayasvin B. Patel, Chairman & Managing Director, expressed confidence in the company's strategic direction, stating, "We are steadily advancing towards our strategic objective of generating 50% of our consolidated revenue from international markets by FY30." He emphasized the company's focus on strengthening relationships with global OEMs, sustained brand-building initiatives, and ongoing investments in R&D and product innovation.

Litigation Settlement with BHEL

In a separate announcement, Elecon Engineering disclosed the amicable settlement of a long-standing dispute with Bharat Heavy Electricals Limited (BHEL). The company has received a total of ₹2,540.00 lakhs from BHEL as part of the settlement, effectively resolving two separate matters:

1. An arbitration case where Elecon had claimed ₹910.00 lakhs, with a counter-claim of ₹257.00 lakhs by BHEL.
2. Another dispute where Elecon had claimed ₹2,250.00 lakhs.

The settlement of these legal matters is expected to have no adverse financial implications for Elecon Engineering.

Conclusion

Elecon Engineering's strong Q1 performance, coupled with the successful resolution of significant legal disputes, positions the company favorably for continued growth. The management's focus on international expansion and strategic investments in key areas underscores their commitment to long-term value creation for stakeholders.

Elecon Engineering Company , a leading manufacturer of industrial gears and material handling equipment in Asia, has announced its unaudited financial results for the first quarter of fiscal year 2026, showcasing strong growth across key financial metrics.

Financial Highlights

For Q1 FY26, Elecon reported:

• Consolidated revenue of ₹491.00 crores, up 25% year-over-year
• EBITDA of ₹130.00 crores, with an EBITDA margin of 26.56%
• Net profit of ₹175.44 crores, a significant increase from ₹73.40 crores in Q1 FY25
• An exceptional item of ₹804.00 crores
• Profit before tax of ₹1,270.00 crores, compared to ₹917.00 crores in the same quarter last year, showing a year-over-year increase

The company's performance was boosted by one-time income from arbitration claim settlements, exceptional gains from investment reclassification, and the reported exceptional item.

Segment Performance

Gear Division

The gear division saw steady demand from domestic power, steel, and cement industries. However, EBIT margin was impacted by increased employee costs and brand-building activities in overseas markets.

Material Handling Equipment (MHE) Division

The MHE division's performance was significantly enhanced by a ₹25.00 crore arbitration settlement income recognized during the quarter.

Strategic Developments

Elecon is making progress towards its goal of generating 50% of consolidated revenue from international markets by FY30. The company is strengthening relationships with global OEMs and investing in R&D and product innovation.

Management Commentary

Shri Prayasvin B. Patel, Chairman & Managing Director, stated, "Elecon continues to maintain its leadership position in the Indian market for both Industrial Gear Solutions and Material Handling Equipment. Our competitive edge is driven by advanced manufacturing capabilities, a comprehensive portfolio of high-quality products, and the ability to deliver custom-engineered solutions with optimized lead times."

Future Outlook

The company remains optimistic about future growth, citing healthy demand in both domestic and overseas markets. Elecon is particularly focused on capitalizing on capacity addition activities in core sectors such as steel, power, and cement.

Recent Developments

In a separate announcement, Elecon informed that it has amicably settled a long-standing dispute with Bharat Heavy Electricals Limited (BHEL). The company has received ₹25.40 crores as part of the settlement, resolving two separate matters that were under arbitration and dispute.

Elecon Engineering continues to demonstrate resilience and growth in its core business segments, positioning itself for sustained performance in the coming quarters.