Craftsman Automation vs Kansai Nerolac Paints Q4 FY26

Craftsman Automation reported a mixed Q4 FY26. The powertrain segment saw margin improvement due to reduced repair maintenance and better product mix, but overall capacity utilization remains at 60-70%. The alloy wheel business exited March at an annualized run rate of 3 million wheels, with revenue of ~₹280 crore for FY26. The Sunbeam restructuring is ongoing, with management exiting unprofitable customers and products, expecting margin traction from Q2 FY27. Management guided for mid-teens revenue growth in FY27, driven by new projects across segments. The large engine powertrain business is on track to reach $100 million revenue by FY29-30. Key risks include inflationary manpower costs, inability to pass on commodity price increases, and potential import competition in alloy wheels.

Guidance read

Mid-teens revenue growth in FY27: Management expects double-digit revenue growth, specifically mid-teens, for FY27, assuming stable aluminium prices. Net debt to EBITDA below 2x in FY27: Management targets net debt to EBITDA to fall below 2x in the current fiscal year, and further to 1.5x. Sunbeam margin improvement from Q2 FY27: Restructuring of Sunbeam (exiting unprofitable customers/products) is expected to show margin traction from Q2 FY27. Large engine powertrain $100M revenue by FY29-30: The large engine powertrain business is on track to reach $100 million in revenue by FY29-30, with phase two expansion decision by September 2026.

Risk read

Key risks include Inflationary manpower costs — Management highlighted that labor cost inflation (20% YoY) is a major concern, difficult to pass on to customers, and could pressure margins.; Aluminium price pass-through and import competition — Analyst raised concerns about alloy wheel imports and commodity price pass-through; management acknowledged the risk and is cautious on further capacity expansion.; Sunbeam restructuring execution risk — Sunbeam's margin improvement depends on successful exit of unprofitable business and customer renegotiations; capacity utilization may temporarily drop to 45-50%.; High capex and debt levels — Despite management's confidence, net debt of ~₹3,300 crore and ongoing capex (land acquisition, new plants) could delay deleveraging if growth slows..

Promise ledger

Scorecard data is being built as historical quarters are processed.

KA

Kansai Nerolac Paints

Q4 FY26 · Manufacturing

Kansai Nerolac reported a 7.6% standalone revenue growth in Q4 FY26, with PBDIT up 21% YoY, driven by improved product mix in decorative and double-digit auto demand. Decorative growth was mid-single digit, with a focus on premium products and new launches like Excel Sheen and XL Everlast. Industrial grew in higher single digits, with auto strong but other segments moderate. Management guided for 13-14% EBITDA margin, assuming raw material stability, and has taken cumulative price hikes of high single digits in decorative. Risks include prolonged West Asia crisis, crude volatility, and rupee depreciation. The company remains cautious on demand visibility due to inflation but sees green shoots from the past five months.

Guidance read

EBITDA margin target of 13-14% for FY27: Management reiterated its endeavor to maintain EBITDA margin in the 13-14% range, assuming raw material costs stabilize. Cumulative decorative price hikes of high single digits: Price increases of ~2% in March and 5-6% in April/May, totaling high single digits, to offset input cost inflation. Double-digit growth target for performance coatings: Management aims to grow the performance coatings segment in double digits, driven by infrastructure spending.

Risk read

Key risks include West Asia crisis and supply chain disruptions — Geopolitical tensions have caused crude price surges and supply chain issues, impacting raw material costs and availability.; Rupee depreciation increasing import costs — Sharp rupee depreciation has raised the cost of imported raw materials, pressuring margins.; Demand visibility remains uncertain due to inflation — Management described demand visibility as 'wait and watch' given the inflationary scenario, with potential impact on consumption.; New competition may intensify price wars — Analyst raised concern about aggressive pricing by new entrants; management noted freebies may have been withdrawn but advertising intensity remains high..

Promise ledger

Scorecard data is being built as historical quarters are processed.