EPACK Durable Ltd

SMP Removal

• Removal of Maneesh Bahuguna, SVP (R&D & Sourcing) and SMP, effective Aug 21, 2026, due to data-handling non-compliance.

Financial Performance

• Q1 FY27 revenue INR 886 crores; up ~34% YoY.
• RAC growth 44% in Q1; volume ~30%, value ~12–15%.
• 72 customers across 19 product categories; reduced concentration.
• Hisense partnership: ~60,000 ACs produced Jan–Jun; Q1 revenue ~INR 65 crores.
• EBITDA margin ex-PLI ~6.5%; PLI benefit ~1.5–2% passed to customers.
• End-year reversal of PLI discounts; EBITDA to normalize next year.
• Capex in Q1 FY27 ~INR 10 crores; total capex guidance ~INR 450 crores.
• Capex booked ~INR 330–340 crores; CWIP ~INR 40–45 crores; balance ~INR 60–70 crores.
• Working capital days ~50–60; inventories being normalized post-season.
• Dehradun & Bhiwadi utilization ~90% in Q1; Sri City ~50% in Q1; all three >60% for FY27.
• Hisense target: INR 8,000 crores revenue in 5 years; first year FY26–27; calendar 2026 Hisense revenue ~INR 120 crores.
• Front-load washing machines: pilot production expected by end-October.

Operating Update

• RAC remains core growth driver; broadening to SDA, LDA, and components.
• Prices updated every quarter; some lag in pass-through due to supply-chain volatility; forex impacted margins.
• Q1 forex loss ~INR 6–7 crores; most price increases passed on; inventory normalization ongoing.
• SDA/LDA margins higher than AC by ~1.5–2 percentage points at gross level.
• New SDA categories added; 3 in Q1; 4 more in pipeline.

Capex and Projects

• Q1 capex booked ~INR 10 crores; total capex ~INR 450 crores.
• Booked capex ~INR 330–340 crores; CWIP ~INR 40–45 crores; remaining ~INR 60–70 crores for year.
• AP MoU: INR 1,085 crores investment over next 5 years; 35 acres land; 50% capex subsidy over 10 years.
• Front-load washing machine pilot production: target by end-Oct; on track.

Guidance and Outlook

• Management does not provide formal forward-looking revenue guidance.
• AC industry expected to grow around 20% in coming year; EPACK aims to outpace industry growth.

Q&A Highlights

• Execution priorities: scale RAC margins, ramp washing machines and LDA capacity.
• Pricing pass-through largely completed; forex impact remained a margin headwind.
• Inventory: finished goods broadly comfortable; normalization ongoing; BIS/QCO revisions elevated working-capital needs.
• Capex: Q1 INR 10 crores; balance ~INR 60–70 crores for the year; Sri City ramp-up improving.
• Hisense updates: 60k AC units Jan–Jun; Q1 revenue ~INR 65 crores; front-load washing machine pilot by Oct.
• No formal forward-looking guidance; Q2–Q3 expected to show margin improvement; 4–6 quarters to stop losses.

Auditor re-appointment

• Re-appointment of Deloitte Haskins & Sells as Statutory Auditors for a second five-year term.
• Effective from conclusion of the 7th AGM until conclusion of the 12th AGM (2031).
• Subject to members' approval at the forthcoming AGM.
• Firm Registration No. 015125N; brief profile not provided.
• Disclosures: relationships with other directors Not Applicable.

Meeting Details

• Date: August 12, 2026; time not disclosed.
• Event: Investors’ Conference Call on Q1 2026 standalone and consolidated results; virtual group call.
• Organizer: EPACK Durable Limited.

Participants

• Sign-off by Company Secretary and Compliance Officer.

Purpose

• Audio recording of the conference call on the quarter ended June 30, 2026 results.

Additional Notes

• Audio recording has been uploaded on the company website.

Business Overview

• Leading living-appliances ODM/OEM with RAC, SDA, LDA, and components.
• Strategy emphasizes localization, backward integration, and capacity expansion.

Key Operational Highlights

• Q1 FY27 revenue ₹8,860 Mn, up 33.8% YoY.
• RAC revenue ₹6,221 Mn; SDA & LDA ₹1,314 Mn; Components ₹853 Mn.
• RAC growth 43.8%, SDA/LDA 68.9% YoY; air-fryer traction strong.
• Diversification: non-RAC share 45% FY26; ~30% in Q1 FY27.
• Top customer concentration declined to 38% FY26 from 72% FY23.
• Strategic capex ₹4,700 Mn planned through FY27.
• Washing-machine expansion and Bhiwadi greenfield to contribute.
• New SDA/LDA/Components product pipeline includes air fryers and more.

Financial Performance

• EBITDA ₹550 Mn; margin 6.21%.
• PAT ₹118 Mn; PAT margin 1.33%.
• Operating revenue ₹8,860 Mn; YoY +33.8%; QoQ +49.9%.
• COGS ₹7,614 Mn; up 36.3% YoY, pressuring margins.
• Depreciation ₹166 Mn; Finance costs ₹202 Mn; Tax ₹58 Mn.
• PLI income nil in Q1 FY27 vs ₹133 Mn in Q1 FY26.
• PBT ₹176 Mn; PAT declined due to higher depreciation and financing costs.

Capital Structure & Liquidity

• Net debt FY26 ₹3,555 Mn; Net debt/Equity 0.72x.
• Promoter stake ~46.4%; institutional ownership ~19%.
• Cash and cash equivalents ₹158 Mn as of 30 Jun 2026.
• Market cap ₹22,210 Mn; CMP ₹230.81.
• Capex program largely funded; ₹4,700 Mn planned through FY27.

Strategic Priorities & Outlook

• Diversify revenue mix; scale SDA/LDA; margins via operating leverage.
• Localization/backward integration to lift value-add and resilience.
• Washing machines capacity expansion; Bhiwadi facility.
• New product pipeline across SDA/LDA/Components; translate scale into profitability.
• FY27 outlook: diversified growth; margin recovery remains priority.

Risks & Mitigation

• Margin pressure from input costs and mix; mitigated by localization and capacity utilization.
• Seasonality causing RAC revenue volatility; diversification mitigates exposure.
• Higher depreciation and finance costs; improving with capacity utilization.

Governance & Leadership

• Promoter stake and institutional holdings indicate alignment and stability.
• No governance changes disclosed.
• Company Secretary: Esha Gupta; investor relations contact.

Financial highlights

• Consolidated revenue for quarter ended June 30, 2026: ₹8,860 Mn (YoY +33.8%).
• EBITDA: ₹550 Mn; EBITDA margin 6.21% (YoY down 203 bps).
• Net profit margin: 1.33% (YoY -213 bps).

Operational performance

• RAC segment revenue grew 43.8% YoY.
• SDA & LDA segments grew 68.9% YoY.
• Component segment declined 23.1% YoY.

Strategic developments

• Product portfolio expansion, stronger order pipeline, new customer acquisitions, and capacity expansion.

Outlook and management commentary

• Management notes strong start to FY27 and broad-based growth across segments.
• Margins pressured by current market conditions; focus on efficiency and profitability as scale.

Conference call / disclosures

• Results prepared under Ind AS; Q1 FY27 conference call on Aug 12, 2026 at 09:30 IST.

Business Overview

• Leading RAC ODM/OEM with growing SDA, LDA and components; backward integration and localization.
• FY26 total income ₹19,107 Mn; manufacturing footprint across Dehradun, Bhiwadi, Sri City.
• Diversification: non-RAC contributed 45% in FY26; Q1 FY27 around 30%.
• Top customer concentration fell to 38% in FY26; de-risked revenue base.

Q1 FY27 Performance

• Revenue ₹8,860 Mn, up 33.8% YoY.
• RAC revenue ₹6,221 Mn, +43.8% YoY; SDA & LDA ₹1,314 Mn, +68.9%.
• PAT ₹118 Mn, down 48.5% YoY; EBITDA ₹550 Mn, margin 6.21%.
• No PLI income in Q1 FY27; ₹133 Mn accrued in Q1 FY26.
• Strategic capex planned ₹4,700 Mn; Q1 FY27 capex ₹102 Mn.
• New capacity via washing-machine expansion and Bhiwadi greenfield.

Capital Structure & Liquidity

• Net debt ₹3,555 Mn; net debt to equity 0.72x.
• RoCE 5.2%, RoE 0.4% in FY26.
• Cash and cash equivalents ₹158 Mn as of 30 Jun 2026.
• Promoter stake 46.4%; institutional ownership about 19%.

Strategy & Outlook

• Diversification journey with localization; margin recovery via capacity ramp.
• SDA & LDA remain fastest-growing, margin-accretive categories.
• Robust product pipeline across SDA/LDA/Components and strong new-customer pipeline for FY27.
• Management focus: translate record scale into profitability; emphasis on operating leverage.
• Capex plan totals ₹4,700 Mn through end of FY27.

Risks & Mitigation

• Margin pressure from input costs; sector-wide trend; mitigated by operating leverage as capacity ramps.
• Higher depreciation and finance costs weigh on profitability.

Market Context

• FY26 stock underperformed Sensex; diversification reduces revenue concentration risk.
• Sourcing and manufacturing localization enhances resilience.

Internal Auditor Re-appointment

• On August 11, 2026, Board re-appointed M/s Ernst & Young LLP as Internal Auditor for FY 2026-27.
• Reason: Audit Committee recommendation.

Meeting Details

• Date and time: Aug 12, 2026 at 09:30 IST.
• Type and mode: conference call, virtual.
• Event: Q1FY27 Results Conference Call organized by EPACK Durable Limited.
• Primary purpose: discuss Standalone and Consolidated unaudited results for Q1 FY27.
• Details to be posted on the company's website.

Participants

• Chairman and Whole-Time Director; Managing Director and CEO; Chief Financial Officer.

Purpose

• Discussion of Standalone and Consolidated unaudited Q1 FY27 results.

Additional Notes

• Details of conference call will be posted on the company website.