STUDDS Q3 FY26 earnings call.
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Revenue
₹163 Cr
verified against source
Revenue YoY
9.4%
reported change
EBITDA
₹30.7 Cr
latest reported figure
Source
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record provenance
Actual signal trajectory
Where this quarter sits.
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What the record says.
Studds Accessories delivered a strong Q3 FY26 with 26.3% PAT growth and 160bps EBITDA margin expansion to 18.8%, driven by favorable raw material prices, procurement efficiencies, and better product mix. Revenue grew 9.4% YoY to Rs 163cr despite being a seasonally investment-heavy quarter where marketing spend was up ~Rs 5 crore sequentially due to participation in India Bike Week and IKEMA Italy. Capacity utilization reached 96% in Q3, confirming supply constraints, though the company added 5 lakh units of temporary capacity bringing total to 9.5 million. The Spain subsidiary remains on track for Q1 FY27 commercial launch to support European expansion targeting 300,000 units (6-7% market share) in 2-3 years. Management expects Q4 to exit higher than Q3 and targets blended ASP beyond Rs 800 in FY27, supported by SMK premium brand mix improvement (13% to 25% of revenue). Risks include raw material cost reversal (styrene prices rising post-December), near-full capacity limiting near-term volume growth, and potential competitive pressure from the India-EU FTA if it benefits Chinese competitors.
Colored figures show movement against the previous available record.
Guidance to track
- Management expects revenues to exit March (Q4) at a better number than Q3, indicating sequential acceleration.
- Target blended ASP to reach beyond Rs 800 next year (FY27) from current Rs 770, driven by continued premiumization.
- Expect SMK premium brand revenue contribution to grow from current ~13% to ~25% in 2-3 years.
- New plant Phase 1 deferred by one quarter to Q2 FY27 (from Q1) due to pollution-related construction restrictions; adds 1.5 million units.
Risks flagged
- Styrene prices declined in December but have started rising again in January due to geopolitical situations; Brent crude at $68-69. Management does not expect EBITDA margins to decline but raw material cost reversal is a risk.
- At 96% utilization in Q3, the company is supply-constrained. While temporary machinery added 5 lakh units, near-term volume growth is limited until new capacity comes online in Q2 FY27.
- Incremental ~Rs 5 crore marketing spend in Q3 (IBW, IKEMA Italy) was a drag on EBITDA; management expects lower marketing expenses in Q4, but this creates quarterly margin volatility.
- Analyst questioned management on competitive landscape; Europe has LS2 (China), MT (Spain), KYT (Indonesia) in the entry-mid segment alongside Studds. India-EU FTA impact remains uncertain.
Key quotes
- We are slightly supply stalled at the moment as I said we have a capacity utilization of 96% right now even after increasing it by five lakh units right so we clearly our supply stalled a little bit.
- The India EU deal and the India UK deal averagely we expect the custom duties to come down. It's an average ballpark figure because it's different for both the places but from 2.5% to almost 0%. So I think the bigger change we will see is once our subsidiary is set up next quarter because then obviously we will go directly to some markets and the ASPs would significantly change.
- If the regulation comes in then it'll be an exponential growth but even without the regulation we still think that our growth will always be bigger than the motorcycle market as has historically been. So if the motorcycle market grows at about 7 to 8%, we looking at our market growing about 12 to 13%.
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