Adroit Q2 revenue rises 25% sequentially as export orders fill forging lines near full use

Adroit Q2 revenue rises 25% sequentially, with H1 forging utilisation at 93.33%

Adroit Industries (India) Limited makes propeller shafts and torque transmission components, the rotating shafts that carry engine power to wheels and pumps in trucks, mining machines and defence and fire-fighting equipment, for OEMs and Tier-1 suppliers with exports to more than 35 countries . On 28 October 2026 it filed its Q2 FY27 presentation for the period ended 30 September 2026, reporting revenue of Rs 42.67 crore, up 25% quarter-on-quarter . The quarter combined sequential revenue growth with a business dominated by exports and repeat customers and entry into industrial and defence shafts. Management expects IPO-funded capacity expansion, after full ramp-up by Q4 FY28, to support peak annual revenue of Rs 250 crore .

Chairman and Managing Director Saurabh Sangla said Q2 FY27 performance reflects sequential growth in revenue and profitability . Management added that it added 13 new customers in Q2 FY27 and that entry into industrial shaft and defence segments expands reach and diversifies across end-user industries .

Earnings in one view: strong half year, softer Q2 margin

The quarter grew sequentially, while the half year shows stronger year-on-year profit growth than sales growth as margins expanded . The Q2 margin slipped from Q1 even as sales rose, which the cost table below helps explain .

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EPS follows the Q2 presentation, which gives the Q1 FY27 comparator as Rs 1.67. The historical financial matrix gives Rs 2.15 for Q1 FY27; the share-count or adjustment basis needs reconciliation .

H1 FY27 revenue was up 11% year-on-year, EBITDA up 48% and profit after tax up 51% . EBITDA margin was 29.3% in H1 FY27 versus 22.0% in H1 FY26, up 731 basis points .

Q2 FY27 revenue was up 25% quarter-on-quarter, EBITDA up 13% and profit after tax up 14% . EBITDA margin was 28.0% in Q2 versus 30.9% in Q1, down 290 basis points .

The longer base from the Q1 FY27 deck shows steady scale-up before this quarter, with margins stepping up in FY26 .

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Q1 FY27 itself had been described as resilient in a traditionally softer quarter, with year-on-year growth in revenue, margin and profit . On a consolidated versus standalone basis, subsidiaries do most of the work .

Consolidated H1 FY27 revenue was Rs 76.79 crore with EBITDA of Rs 24.92 crore, against standalone H1 FY27 revenue of Rs 21.12 crore with EBITDA of Rs 2.86 crore . Here, the financial matrix defines EBITDA as profit before tax plus finance cost and depreciation, including other income. The presentation’s operating EBITDA excludes other income: its H1 FY27 figure of Rs 22.507 crore plus Rs 2.410 crore of other income reconciles to Rs 24.917 crore, or Rs 24.92 crore after rounding .

Costs explain the margin move

Management links margins to in-house control from forging and heat treatment through precision machining, assembly and balancing and finishing across three facilities . That integration supports quality, traceability and production planning .

In Q2, the combined total of raw material, employee benefits and other expenses grew faster than revenue, reducing the operating EBITDA margin . The H1 year-on-year expansion came even as material and employee costs rose, because other expenses were lower than a year earlier .

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Other income was Rs 1.12 crore in Q2 FY27 versus Rs 1.29 crore in Q1 FY27 . Finance cost was Rs 1.38 crore versus Rs 1.19 crore, depreciation was Rs 1.10 crore versus Rs 1.13 crore, and tax was Rs 2.05 crore versus Rs 2.05 crore .

The Q1 FY27 deck had made the same operating leverage point . It noted total expenses were essentially flat year-on-year while income grew, helped by 90-95% in-house forging and an export mix that supports higher margins .

Exports and repeat customers dominate sales, new customers add breadth

Adroit said 82% of Q2 FY27 product sales came from exports and 87.39% came from repeat customers, with reach across 35 countries and a range of 5,250 SKUs . Customer qualification cycles of 12-18 months or longer help explain that stickiness .

Those cycles involve audits, testing and tooling investment . Engineering is built to customer specifications with precision machining, metallurgical testing and dynamic balancing .

H1 FY27 export dependence was concentrated in North America, which is why new-customer breadth matters for the order book .

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The company supports that mix with Adroit Driveshafts USA LLC in the USA and Adroit Driveshafts Canada Limited in Canada, both wholly owned . The US presence supports customer relationships and service, while Canada handles engagement, coordination and after-sales support .

The Indian arm, Adroit Driveshafts Private Limited, is 99.87% owned for manufacturing and distribution . The stated go-to-market is to deepen relationships through subsidiaries, distributors, sales agents and trade exhibitions .

The Q1 FY27 deck had framed the same push as export leadership with 85-95% revenue from exports and about 96% repeat revenue . It also cited new wins from Volvo Eicher, Ashok Leyland Defence, BEML and others with an order book of about Rs 20 crore for FY27 to support utilisation and operating leverage .

Plants are running hot, so expansion timing is central

H1 FY27 utilisation shows why capacity expansion matters . Forging was nearly full and machining was high, while finishing had headroom .

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The expansion roadmap targets Dewas forging from 3,000 tons to 5,500 tons by Q1 FY28 and Pithampur machining and assembly from 900,000 units to 1,800,000 units by Q4 FY27 . That is 1.83 times existing capacity at Dewas and twice existing capacity at Pithampur .

The roadmap page says plant and machinery worth Rs 63.7 crore is planned under IPO proceeds . It says machinery worth Rs 50 crore has been received and is currently operational, and orders worth Rs 30 crore have already been placed .

The management commentary in the same deck says machinery worth Rs 5 crore has already been purchased and commissioned and orders worth Rs 30 crore placed . It says additional machining capacity is on schedule from Q4 FY27 and forging by Q1 FY28 . The roadmap and commentary therefore report different amounts for received/operational versus purchased/commissioned machinery: Rs 50 crore and Rs 5 crore. The company needs to reconcile their scope and status and clarify any overlap with the Rs 30 crore of orders before remaining expenditure can be assessed .

Management said the IPO-funded expansion remains on track and it is targeting full ramp-up by Q4 FY28 . It said expanded capacity could then support peak annual revenue of Rs 250 crore, with focus on execution, customer acquisition and building a foundation for sustained profitable growth .

The Q1 FY27 deck had set the same priority as swift deployment of IPO proceeds to double capacity . It noted Pithampur was fully utilised in FY26, Dewas was close to full use, and Sanwer had spare capacity, with vacant land at each site for growth .

Product and domestic push widens the funnel

The portfolio spans propeller shaft assemblies, universal joints, end yokes, tube and weld yokes, flange yokes, centre support bearings and CV Double Cardan driveshaft assemblies . Uses shown include fire fighting, defence, construction and mining, mining and locomotive .

The company crossed 5,000 SKUs with the launch of aluminium driveline components in 2025-26 and reports 5,250 SKUs in Q2 FY27 . Growth pillars include adding forging equipment at Dewas and machining, assembly and testing at Pithampur .

Other pillars are to develop industrial shafts, propeller shafts, universal joints, axle shafts and aluminium driveline components, grow international sales, expand direct supplies to Indian OEMs, and expand into critical shaft assemblies for defence and fire fighting .

Named Indian customers include VE Commercial Vehicles, Ashok Leyland, BEML, Godrej and Boyce, Action Construction Equipment, Ajax and Eimco Elecon, against a Q2 base still 82% export-led . For context, FY26 mix was 68% machined components and 32% finished assemblies, with 74.8% automotive and 25.2% non-automotive .

Channel mix in FY26 was 62.3% revenue from distributors, 32.7% from Tier-1 suppliers and 5.0% from OEMs .

Cash-rich after listing, but operating cash flow is negative

Cash and equity stepped up after listing, while borrowings remained sizable alongside the capex plan .

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Working capital tied to export-heavy repeat sales rose year-on-year . Inventories, receivables and other current assets all increased, lifting total current assets faster than current liabilities .

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Despite H1 FY27 profit after tax of Rs 16.04 crore on a consolidated basis, operating cash flow was negative Rs 18.3 crore in H1 FY27 . The company therefore reported an operating cash outflow despite positive profit. The year-on-year inventory and receivables increases above indicate more funds tied up in those assets, but do not establish the causes of the H1 cash outflow: that requires a cash-flow reconciliation from the opening balance sheet for H1 FY27 .

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Sources

1. 1 Investor Presentation on the performance of Q2 FY27
2. 2 Investor presentation, Oct 2026
3. 3 Adroit Industries (India) Ltd — historical financial matrix and financial statement analysis