Synergy Green Industries , a leading manufacturer of wind turbine castings, reported a 16.4% quarter-on-quarter revenue decline to approximately 74.00 crores in Q2. The company attributed this decrease primarily to customer scheduling delays and slower domestic wind industry offtake in the first half of the fiscal year. Despite the revenue drop, Synergy Green maintained its 20% full-year growth guidance, citing strong order book visibility.

Improved Margins Amid Revenue Decline

Despite the revenue setback, Synergy Green Industries demonstrated resilience in its profitability. The company's PBDIT (Profit Before Depreciation, Interest, and Tax) margins improved to 15.74% in Q2, up from 14.13% in the same period last year. This improvement was attributed to better export business growth and stable raw material prices.

Key Financial Highlights

Factors Influencing Performance

Several factors contributed to Synergy Green's Q2 performance:

1. Customer Scheduling Delays: The company faced delays in customer schedules, impacting revenue realization.
2. Slower Domestic Wind Industry: The first half of the fiscal year saw a slower-than-expected offtake in the domestic wind industry.
3. Export Growth: Despite domestic challenges, the company experienced growth in its export business.
4. Stable Raw Material Prices: Consistent raw material costs helped maintain profitability.

Outlook and Strategic Initiatives

Synergy Green Industries remains optimistic about its full-year performance, maintaining its 20% growth guidance. The company's confidence is based on:

1. Strong Order Book: Robust visibility in the order book supports the growth outlook.
2. Capacity Expansion: The company is in the process of expanding its foundry capacity from 30,000 MT to 45,000 MT per annum.
3. New Customer Acquisitions: Synergy Green has successfully onboarded new customers, including Envision and Nordex, alongside existing clients like Vestas, Siemens Gamesa, and GE Vernova.
4. Diversification: The company is exploring opportunities in non-wind segments, including mining, plastic injection, and pumps.

Management Commentary

V. Srinivasa Reddy, Executive Director of Synergy Green Industries, commented on the results: "While we faced some scheduling challenges in the first half, our strong order book and strategic initiatives position us well for the remainder of the fiscal year. The improved margins reflect our operational efficiency and the growing contribution from our export business."

Synergy Green Industries' ability to maintain its growth guidance despite the Q2 revenue decline demonstrates the company's resilience and strategic positioning in the wind turbine components market. As the domestic wind industry picks up pace and export opportunities expand, the company appears well-positioned to capitalize on the growing demand for renewable energy components.

Investors and industry observers will be watching closely to see if Synergy Green can meet its ambitious growth targets in the second half, particularly as it ramps up its expanded production capacity and leverages new customer relationships.

Synergy Green Industries Limited , a leading manufacturer of metal castings, has reported its financial results for the first half of FY2025-26, showing a mixed performance with revenue decline but margin improvement.

Financial Highlights

Half-Year Performance

• Total Income: ₹159.75 crore, down 4.9% from ₹167.93 crore in the corresponding previous period
• PBDIT: ₹24.86 crore, up 4.8%
• PBDIT Margin: Improved by 128 basis points from 14.13% to 15.56%

Revenue Breakdown

• Export revenues grew 52% from ₹31 crore to ₹47 crore
• Lower schedules from domestic wind and OEM exports contributed to the overall revenue decline
• Growth observed in Direct Exports, Gearbox, and Non Wind segments

Strategic Initiatives

Capacity Expansion

• Foundry capacity expansion from 30,000 TPA to 45,000 TPA, expected to be operational in Q3 FY2025-26
• Commissioned an 8MW solar project

Business Outlook

• Projects 20% order book growth for FY2025-26
• Product development activities for Envision, Nordex, and Adani on track
• Management expects PBDIT margins to expand by 100 basis points for the full year FY2025-26

Corporate Actions

Management Changes

• Internal Auditor Appointment: Mr. Jitendra Patil has been appointed as the company's Internal Auditor

Dividend Recommendations

• Equity Dividend: The Board has recommended a final equity dividend of ₹1 per equity share of ₹10 each
• Preference Dividend: A preference dividend of ₹10 per preference share has been recommended

Employee Stock Option Plan

Synergy Green Industries has approved an Employee Stock Option Plan (ESOP) with the following details:

• Number of options: 22,980
• Purchase price: ₹70 per share

The ESOP aims to align employee interests with the company's success.

Despite the reported revenue decline, Synergy Green Industries continues to focus on strategic initiatives, capacity expansion, and employee engagement. The company's decision to appoint a new Internal Auditor and implement an ESOP suggests a commitment to strengthening internal controls and motivating its workforce.