Transcript of Conference Call - Unaudited Financial Results for the quarter and half year ended September 30, 2025
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Permanent Magnets reported Q2 FY26 revenue of INR49 crore, down 12% YoY, and H1 revenue of INR102.7 crore, down 7% YoY, mainly due to lower US exports (hit by tariff uncertainty) and weak domestic energy meter demand. Management said the US customer has resumed orders and the situation is improving. The new alloy furnace is on track for December 2025 installation, with the 750-ton capacity partially booked by 4-5 customers across oil & gas, powder metallurgy, and aerospace. The relay facility will be operational by Q4 FY26 with commercial sales starting mid-FY27. The Quantum Magnetics JV with Lorentic was executed in August, with Phase 1 capex of INR50-100 crore for a 500-ton pilot. Management guided FY26 revenue of INR220-230 crore (10-15% growth) and FY27 growth of 20-30% with EBITDA margins improving to 16-18% from current ~12% levels. Long-term FY30 target for Quantum Magnetics: 5,000 tons, INR3,700 crore revenue, INR550 crore EBITDA on INR550-750 crore capex. A INR7,300 crore government scheme for rare earth magnets is expected in December/January.
Near-term, H2 FY26 growth hinges on alloy capacity ramp-up, which is partially booked and should drive the company back to ~10-15% full-year growth. For FY27, management's guidance of 20-30% revenue growth and 16-18% EBITDA margins points to a meaningful earnings rebound, supported by alloys, relay commercialisation, and resumption of Quantum Magnetics assembly. The disclosure of a long-term INR3,700 crore FY30 revenue target from the rare earth magnet JV signals significant optionality, though execution risk remains high given the scale and capex required.