Dhoot Transmission Q2 revenue jumps 61 percent to Rs 1,827.2 crore on EV surge, margin slips to 14.3 percent

Dhoot Transmission makes wiring harnesses that work like the nervous system of two-wheelers and three-wheelers, plus switches, sensors and battery packs for vehicle makers. On November 3, 2026, its board approved results for the quarter ended September 30, 2026, with revenue of Rs 1,827.2 crore, up 60.7 percent year on year, EBITDA of Rs 261.8 crore, up 30.5 percent, and adjusted profit after tax of Rs 161.5 crore, up 30.4 percent . EV supplies rose 108 percent to 31 percent of revenue while net cash stood at Rs 903.7 crore excluding leases, showing strength ahead of industry but margin down 330 basis points on copper lag and manpower costs .

Growth was domestic-led and EV-led

India business revenue grew 65 percent year on year in Q2 FY27 while global business grew 12 percent year on year . EV-related supplies grew 108 percent year on year to 31 percent of consolidated revenue in the same quarter .

The quarter extended a multi-year acceleration in the top line, with half-year revenue already at 72 percent of FY26 .

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Growth is described as 23 percent in FY25, 31 percent in FY26 and 56 percent in H1 FY27 to Rs 3,273.6 crore . Excluding Multilink, Q2 FY27 revenue was Rs 1,665.6 crore, up 47 percent year on year . H1 FY27 revenue excluding Multilink was Rs 3,085.1 crore, also up 47 percent year on year . Both periods ran well ahead of about 20 percent industry two-wheeler retail growth .

In H1 FY27, wiring harness revenue grew 43 percent and battery and electronics grew 98 percent year on year . Management links this to premium mix and EV content lifting volume and value, with Multilink adding scale .

EV scale-up is now material to mix, rising from 24 percent of revenue in FY26 to 31 percent in Q2 FY27 .

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In H1 FY27, Dhoot EV volumes rose 91 percent against industry EV up 76 percent . Dhoot harness revenue rose 43 percent against industry retail units up 20.4 percent to 1.10 crore units . Management says harness revenue grew about 2.1 times the pace of industry retail units .

The same drivers were flagged a quarter earlier. On the Q1 FY27 call for the quarter ended June 30, 2026, management reported total growth of nearly 50 percent year on year . Wiring harness revenue in that quarter was about Rs 1,090 crore against Rs 753 crore a year earlier, up 44.6 percent . Non-wiring harness revenue was about Rs 358 crore against Rs 213 crore, up 67.7 percent . EV revenue grew 79 percent to 27 percent of revenue from 24 percent . Management guided at that time to another strong year of 25 to 30 percent growth .

Why profit grew slower than sales

Reported EBITDA grew in absolute terms but margin compressed as input and manpower costs rose faster than customer recoveries.

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Q2 FY27 EBITDA was up 30.5 percent year on year while margin fell 330 basis points year on year and 83 basis points quarter on quarter . H1 FY27 EBITDA was up 29.4 percent while margin fell 290 basis points year on year . Profit before tax in Q2 FY27 was Rs 211.6 crore, up 30.6 percent year on year . In H1 FY27 it was Rs 388.6 crore, up 34.5 percent .

Reported profit after tax was held back by one-off charges, while adjusted profit tracked operating growth more closely.

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Reported PAT in Q2 FY27 fell 0.3 percent year on year to Rs 117.8 crore on exceptional items of negative Rs 54.8 crore . Adjusted PAT rose 30.4 percent to Rs 161.5 crore after adding back management fees and IPO expenses charged to profit and loss . In Q2 FY27 those items were Rs 45 crore toward management fees and Rs 9.7 crore of IPO expenses .

Cost pressure came from three buckets that management quantifies for the quarter.

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For H1 FY27, total material cost was Rs 2,233.9 crore, up 66.3 percent, employee benefits was Rs 246.9 crore, up 36.7 percent, and other expenses was Rs 312.5 crore, up 49.9 percent .

Management bridges the Q2 margin fall as higher copper with impact of about 150 basis points, PVC costs with quarter impact, and higher direct and indirect manpower including ESOP costs with impact of 120 basis points . Multilink at lower margin added about 38 basis points of drag in Q2 . For H1, the bridge is copper about 120 basis points, higher PVC and electronics costs, manpower including ESOP about 130 basis points, and Multilink about 30 basis points .

The copper lag was pre-flagged. On the Q1 call, management said most copper inflation was already passed on but prices rose further in the last 4 to 5 months . Copper was about 20 to 23 percent of bill of materials cost in that discussion . Recovery happens with a lag of three months as customers reset prices . July and August 2026 saw a further 3 to 4 percent elevation, so recovery would likely come in Q3 if prices stabilise, not immediately in Q2 . In a hard commodity cycle it absorbs the cost and recovery starts when raw materials soften . Wage hikes follow state minimum-wage contracts and are discussed with customers yearly .

Adjusted organic EBITDA strips out Multilink and ESOP costs to show the underlying run rate.

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Multilink in Q2 FY27 had revenue of Rs 161.5 crore and EBITDA of Rs 16.8 crore at 10.4 percent . In H1 FY27 it had revenue of Rs 188.5 crore and EBITDA of Rs 19.7 crore at 10.4 percent . After adjusting ESOP cost, which adds 48 basis points in Q2 and 27 basis points in H1, adjusted organic EBITDA margin is 15.2 percent for both Q2 FY27 and H1 FY27 . EBITDA is defined as profit before tax and exceptional items plus depreciation and amortisation plus finance cost minus other income, divided by revenue from operations . From the Q1 vantage point, management stuck to a 15 to 16 percent margin guidance band for the full year .

Multilink broadens the platform beyond harnesses

Q2 FY27 was the first full quarter with Multilink consolidated, after control was gained on June 11, 2026 . Multilink makes sensors, relays and other electronic products . In Q1 it had contributed only for 20 days, about 3 percent of overall growth .

The strategic point is diversification away from harness concentration. Non-harness products were 18 percent of revenue in FY24, 22 percent in FY25 and 23 percent in FY26 . In Q2 FY27 they reached 31 percent as Multilink was integrated . The Q2 mix was wiring harness 69 and others including battery, electronics and components 31 .

Management says Multilink added Hero as a customer for EV-related components . It also added fuel-level sensors and relays with cross-selling scope because Multilink did not supply many of Dhoot existing customers . It expects 25 to 30 percent growth on Multilink as well with margin moving in line with Dhoot margin after full integration . Integration was guided to take another 3 to 4 months from early September and to be completed by Q4 .

That fits the wider platform plan. Dhoot describes itself among the top two wiring harness makers for two-wheelers and three-wheelers in India with 2 out of 5 of the market by value in FY26 . It cites about 70 percent share of the two-wheeler EV wiring harness market by value and work with the top six two-wheeler makers on a long-term basis .

Around the harness core for low-voltage, high-voltage and battery harnesses, it lists safety-critical electronics, switches and relays, battery packs and EV electronics, and connection systems . Current items include ABS sensors, start-stop switches, 48V traction packs and charging guns . Pipeline items include off-board chargers, DC-DC converters, battery management systems and ADAS cameras . About 95 percent of the portfolio is EV-focused or powertrain-neutral .

Balance sheet turns cash-rich after IPO

Finance cost fell as debt was repaid from equity inflows. Q2 FY27 finance cost was Rs 14.9 crore against Rs 22.8 crore in Q2 FY26 . H1 finance cost was Rs 30.4 crore against Rs 46.3 crore . Other income was Rs 15.1 crore in Q2 and Rs 28.8 crore in H1 . Other income included Rs 10.5 crore interest on fixed deposits created from the March 2026 equity infusion .

Depreciation and amortisation rose to Rs 50.5 crore in Q2 from Rs 30.4 crore on higher capitalisation, Multilink impact and lease amortisation .

Borrowings fell from Rs 841.4 crore to Rs 223.8 crore, and net cash excluding leases rose from Rs 254.4 crore to Rs 903.7 crore between March and September 2026.

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Leases classified as debt were Rs 148.7 crore . Trade working capital rose to Rs 1,096.4 crore from Rs 870 crore, or 61 days from 55 days . Net debt to EBITDA was negative 0.8 times, gross debt to equity 0.1 times, interest cover 14.7 times and current ratio 2.4 times at September 2026 .

The August 2026 IPO is the reason. The company sold 16,080,445 new shares for Rs 1,400 crore alongside an offer for sale, listing on August 17 . Net proceeds were Rs 1,326.98 crore after costs . Of this, Rs 464.80 crore was used to repay its own loans and Rs 301.77 crore was infused into subsidiaries to repay their loans by September 30 .

H1 cash flow shows IPO proceeds of Rs 1,400 crore, net borrowings repaid of Rs 617.4 crore, Multilink acquisition outflow of Rs 421.2 crore and capital expenditure of Rs 292.9 crore . On the Q1 call, management said finance cost had already fallen on March infusion-led working capital optimisation . Management put the debt level at about Rs 220 crore at end-June, with fixed deposits from the March infusion on the other side, and said the position turned cash surplus after the August IPO money .

What management is betting on next

Capacity is being added ahead of customer demand . Capex deployed trend and budget show a step-up planned for FY27.

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FY27 budget was revised to Rs 750 crore from Rs 510 crore initially budgeted . Plant count rose from 22 at March 2026 to 29 at September 2026 after adding three Multilink facilities, two battery plants and two wiring harness plants . There are 26 plants in India and 3 outside .

New wiring harness plants are planned at Pune and Chennai in Q3 FY27, Jhajjar in Q4 FY27 and Q2 FY28, and Hosur in Q1 FY28 . Land was acquired at Chhatrapati Sambhajinagar and near Indore . Battery capacity rose 110 percent in H1 with two new powertrain battery plants at Hosur and Pune . Powertrain battery manufacturing for a south India-based leading maker started in June 2026 .

On products, management points to growing harness, EV charging and battery content per vehicle . Wiring harness content per electric two-wheeler is 1.5 to 2.5 times an internal combustion vehicle because electrics need an extra high-voltage harness alongside low-voltage . With cord sets, charging guns, chargers, DC-DC converters and battery pack assembly the value can go up to 4 times if a customer picks all products .

For EV cord sets for next year, it claims 40 to 45 percent share of business for the Indian market . Cells for packs are supplied by customers while holders, busbars, harnesses, sensors and connectors are done in-house . Near-term battery focus is consolidating two-wheeler packs for the next one or two years .

New milestones in Q2 include Hero for EV components via Multilink and a 67 to 33 agreement to enter a joint venture with Ride Vision for ADAS, where about 90 percent is imported today . Proof-of-concept discussions are ongoing with EV players .

Managing Director Rahul Dhoot said two-wheeler and three-wheeler growth remains robust and electrification has accelerated, helping Dhoot outperform given its EV presence . He said it will keep investing in capacity and technology in stages against validated customer programs within return parameters .

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Sources

1. 1 Press release - Financials Q2 FY 2026-27
2. 2 Investor presentation, 2026-11-03
3. 3 Earnings-call transcript, 2026-09-10
4. 4 Investor presentation, Sep 2026
5. 5 Dhoot Transmission Ltd - 544867 - Board Meeting Outcome for Unaudited Financial Results (Standalone And Consolidated) - Q2 FY 2026-27