RACL Geartech Limited has released the official transcript of its Q2 FY26 earnings conference call held on December 5, 2025, pursuant to Regulation 30 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The comprehensive transcript provides detailed insights into the company's financial performance and strategic initiatives.

Conference Call Highlights

The earnings call was moderated by Neha Bahal, Company Secretary and Compliance Officer, with key management participation including:

The call covered the company's performance for Q2 FY26, strategic developments, and future outlook across automotive and industrial segments.

Financial Performance Discussion

During the call, management detailed the company's strong Q2 FY26 results, reaffirming the previously reported financial metrics:

The management emphasized the company's improved operational efficiency and strong cash flow generation, with operating cash flows growing by approximately 50% in H1 FY26.

Strategic Developments and Business Updates

Technical Collaboration with ARRK Engineering

Management provided detailed insights into the technical collaboration with German company ARRK Engineering GmbH. This partnership enables RACL Geartech to transition from a "built to print" model to a "concept to print" approach, offering complete product design capabilities from inception to production.

New Business Nominations

The company confirmed receiving a second nomination for transmission parts of gearbox assembly from one of India's largest premium two-wheeler manufacturers, with production expected to commence from July 2027.

Credit Rating and Debt Management

Management discussed the improved credit outlook from Care Ratings, with the rating reaffirmed at A- for long-term facilities and A2+ for short-term facilities, while the outlook was upgraded from Stable to Positive. Total rated facilities decreased to ₹273.38 crores from ₹336.93 crores.

Market Expansion and Future Outlook

Defense Sector Participation

The company participated in a defense manufacturing exhibition in Jabalpur from November 7-9, 2025, showcasing its capabilities to defense sector stakeholders and exploring opportunities in this growing segment.

Customer Updates and Production Status

Management provided updates on various customer programs, including:

Investor Engagement and ESG Initiatives

The company conducted its third annual shareholder plant visit on October 15, 2025, at the Gajraula facility. Additionally, RACL Geartech received a "Medium" ESG rating from Dun & Bradstreet for the second consecutive year across environmental, social, and governance parameters.

Management Commentary on Growth Strategy

Chairman and Managing Director Gursharan Singh emphasized the company's diversified approach across multiple automotive segments, stating that this strategy provides resilience against sector-specific challenges. The management reiterated confidence in achieving double-digit revenue growth for FY26, with H2 expected to outperform H1.

The company maintains its long-term vision of reaching ₹1,000 crores in revenue within the next three to five years, supported by strategic partnerships, technological upgrades, and market expansion initiatives across automotive and emerging sectors including defense and advanced mobility solutions.

RACL Geartech Limited, a prominent player in the automotive component manufacturing sector, has announced a groundbreaking strategic technical agreement with ARRK Engineering GmbH, a leading German engineering services provider. This partnership marks a significant step for RACL Geartech as it aims to expand its capabilities and transition from a component supplier to an end-to-end engineering and industrialization solution provider.

Synergizing Expertise

The alliance brings together ARRK Engineering's advanced expertise in product design, prototyping, virtual simulation, testing, and validation with RACL Geartech's established capabilities in mass production of high-precision gears, shafts, and precision machined components. This collaboration is set to cater to the evolving needs of the global automotive and E-Mobility markets.

Enhanced Service Offerings

Through this partnership, RACL Geartech is positioning itself to offer comprehensive solutions that go beyond manufacturing. The company will now be able to provide:

• End-to-end solutions for driveline and other precision components
• Product design services
• Engineering solutions
• Testing and validation services

Early-Stage Integration

A key advantage of this agreement is RACL Geartech's ability to offer concept-to-production solutions to OEMs and Tier-1 suppliers at earlier stages of product development cycles. This early integration is expected to streamline the product development process and potentially reduce time-to-market for new automotive solutions.

Value Chain Advancement

Jitender Jain, Chief Financial Officer of RACL Geartech Limited, emphasized the strategic importance of this partnership, stating, "It shall enable RACL to move up the value chain from being a component supplier to an end-to-end Engineering & Industrialisation solution provider."

Market Impact

The collaboration is anticipated to strengthen RACL Geartech's position in the automotive supply chain, particularly in the rapidly growing E-Mobility sector. By combining ARRK's advanced design, simulation, and validation tools with RACL's manufacturing prowess, the company is set to offer more comprehensive and innovative solutions to its clients.

This strategic move by RACL Geartech aligns with the global trend of automotive suppliers expanding their service offerings to meet the complex demands of modern vehicle development, especially in the context of electric and hybrid powertrains.

As the automotive industry continues to evolve, partnerships like this between manufacturing specialists and engineering service providers are likely to play a crucial role in shaping the future of mobility solutions.