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Aeroflex Industries Ltd — Q4 FY26
Aeroflex delivered a standout Q4 FY26 with revenue of ₹126.5 Cr (+38% YoY) and EBITDA of ₹30 Cr (+59% YoY), driven by strong execution in hoses/assemblies and the ramp-up of liquid cooling skid assemblies (617 units sold, ₹21.2 Cr revenue).
bullish
high
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Aeroflex delivered a standout Q4 FY26 with revenue of ₹126.5 Cr (+38% YoY) and EBITDA of ₹30 Cr (+59% YoY), driven by strong execution in hoses/assemblies and the ramp-up of liquid cooling skid assemblies (617 units sold, ₹21.2 Cr revenue). EBITDA margin expanded 326 bps to 23.86% on improved product mix and operating leverage. The skid assembly capacity is being scaled from 2,000 to 15,000 units p.a. by Q1 FY27, with management targeting 60-70% utilization by March 2027. The base business (ex-skids) is expected to grow 15-20% in FY27, while skids could contribute 20-22% of total revenue. Key risk: execution bottlenecks in skid assembly design and customer quality audits could delay revenue ramp-up.
Promises0 met · 2 missedRisks4 trackedTranscriptfull text
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Promises
2 promises
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0 delivered, 0 close, 2 missed.
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Risks
4 risks
Risk Intelligence
Skid assembly design and quality audit bottlenecks
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Transcript
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Read Transcript →Quarter Snapshot
Skid assemblies sold in FY26
617
New segment
First full year of sales; generated ₹21.2 Cr revenue in 4 months.
Skid assembly capacity (annualized)
6,000 units
+200% vs prior capacity
Expanded from 2,000 to 6,000; further expansion to 15,000 by Q1 FY27.
Domestic sales share
31%
+5pp YoY
Driven by skid assembly sales; domestic revenue grew ~40% YoY.
Metal bellows revenue FY26
₹8 Cr
New segment
Gaining traction; ARR now ~₹12 Cr; targeting 50-60% capacity utilization in 2-3 years.
What Changed vs Last Quarter
NEW
FY27 revenue growth ~35% overall
Management guided for ~35% revenue growth in FY27, driven by skid assembly ramp-up and 15-20% growth in base business.
NEW
Skid assembly utilization target of 60-70% by March 2027
Target to reach 60-70% utilization on the 15,000-unit capacity by March 2027.
UPDATED
FY27 EBITDA margin target ~23%
Full-year EBITDA margin target of ~23%, with a medium-term goal of 25% over the next couple of years.
UPDATED
Skid assembly capacity expansion to 15,000 units p.a. by Q1 FY27
Capacity to be expanded from 6,000 to 15,000 units per annum by the next quarter (Q1 FY27).
DROPPED
Hose capacity expansion to 20 million meters by Q2 FY27
Remaining 2.5 million meters of hose capacity to be commissioned in a phased manner, expected to be completed by Q2 of next financial year.
DROPPED
Metal bellows peak revenue of ₹85-90 crore by FY29
Metal bellows plant expected to achieve peak utilization of ₹85-90 crore revenue by end of FY28/start of FY29.
NEW RISK
Skid assembly design and quality audit bottlenecks
Management acknowledged that design finalization and rigorous customer quality audits are causing delays in skid assembly production and revenue recognition.
NEW RISK
Customer concentration in skid assembly business
Skid assembly sales are currently 100% dependent on one exclusive customer, creating single-client risk.
NEW RISK
Income tax demand of ~₹40 Cr
An income tax demand of ~₹40 Cr related to FY18-19 has been raised; management is confident of reversal on appeal but outcome is uncertain.
NEW RISK
Geopolitical and tariff risks in US market
Despite tariff reductions, US trade policy uncertainty and geopolitical tensions could impact export growth.
RISK GONE
US tariff uncertainty impacting new customer acquisition
Tariffs are delaying onboarding of new US customers, though existing customers continue to place repeat orders. Resolution of tariffs could significantly boost margins.
RISK GONE
Metal bellows business behind schedule
Metal bellows revenue run-rate is only ₹12 crore vs. expected ramp-up, partly due to US tariff headwinds. Management acknowledged it is 'a little behind schedule'.
RISK GONE
Liquid cooling margin transparency
Management declined to disclose margins for the liquid cooling skid business due to confidentiality, raising uncertainty about profitability relative to other segments.
RISK GONE
Raw material price volatility
Stainless steel prices, a key raw material, could impact margins if volatility increases. Management uses back-to-back contracts but admits significant swings could affect margins.
Fast read
Guidance and risk preview
Management guided for ~35% revenue growth in FY27, driven by skid assembly ramp-up and 15-20% growth in base business.
Management acknowledged that design finalization and rigorous customer quality audits are causing delays in skid assembly production and revenue re...
View Risks →