Sahasra Electronic Solutions Navigates Growth and Diversification in H1 FY26

Sahasra Electronic Solutions Limited, a prominent player in India's electronics system design and manufacturing (ESDM) sector, has reported a robust performance for the first half of Fiscal Year 2026. The company, known for its diversified offerings across various industries, achieved a revenue of INR 61.44 crores, demonstrating a significant recovery and positive momentum after a challenging previous fiscal year. This performance reflects the company's strategic pivot towards the domestic market and its continuous efforts in expanding capabilities and product portfolios.

The company's H1 FY26 results highlight a healthy financial position, with an EBITDA Margin of 21.71% and a Net Profit Margin of 15.49%. This marks a notable improvement from the previous fiscal year's consolidated PAT of 9.13%, indicating effective cost management and enhanced operational efficiency. The management expressed satisfaction with these results, affirming that the company is on track to meet its full-year revenue projections.

Strategic Shifts and Segmental Performance

Sahasra's business model is built on navigating the entire ESDM value chain, from design and prototyping to mass production and lifecycle management. Historically, the company had a strong reliance on exports, with 85-90% of its revenue coming from international markets. However, in response to global market uncertainties and challenges in the export sector, Sahasra has strategically rebalanced its focus. The export share now stands at approximately 50-55%, with the domestic market contributing 45-50% of the revenue.

This pivot has been supported by significant investments in manufacturing infrastructure. The company added two new SMT lines at its Bhiwadi unit, which played a crucial role in meeting the growing domestic order book. Further investment in two more high-speed SMT lines is underway to bolster production capacity for large volume and high-capability projects. These initiatives underscore Sahasra's commitment to strengthening its manufacturing prowess and catering to diverse customer demands.

In terms of segmental performance for H1 FY26, the company reported:

Key Initiatives and Future Outlook

Sahasra Electronic Solutions is actively pursuing several strategic initiatives to drive organic growth and enhance its market position. The company has entered into a multi-year manufacturing and supply chain agreement with Solid State Supplies Limited (Solsta) and secured an order from Inepro Metering to manufacture off-grid energy meters for EV charging stations, with the first production shipment expected in December. These moves signify its expansion into high-growth sectors like EV electronics and energy metering.

Furthermore, the company has filed a copyright application for its "Sahasra In-House SPI TPM Reference Design" and a design for its schematic, demonstrating its focus on intellectual property development. A desktop motherboard designed by Sahasra is currently in the verification and validation cycle, with a launch scheduled by the end of FY2025-26. A significant contract has also been signed with a European company for manufacturing e-sims and other EMS products for export to the EU, further diversifying its international footprint.

The semiconductor business, particularly involving memory and eSIMs, experienced a slower first half due to delays in eSIM approval cycles. However, the final contract for eSIM manufacturing was signed in October, with mass production anticipated from March of the next calendar year. The memory business is also poised for recovery, benefiting from increased prices and demand driven by AI advancements.

Financial Projections and Strategic Mergers

Looking ahead, Sahasra has outlined ambitious financial targets. The projected revenue for FY2025-2026 is INR 140 crores, increasing to INR 225 crores for FY2026-2027. The company aims for a consistent EBITDA Margin of 20% across these years, with Net Profit Margins targeted at 15% and 14% respectively. Long-term goals include achieving consolidated revenues of INR 350 crores by FY2027.

To support its growth ambitions, particularly in the semiconductor segment, Sahasra plans capital investments of INR 200 crores for Phase II. This investment is expected to be partially funded by a 50% grant from the upcoming India Semiconductor Mission Scheme 2.0, with the remaining capital sourced from internal accruals and debt financing. The company expects its subsidiary, Sahasra Semiconductors Pvt Ltd, to achieve cash break-even in 2025-26 and a profit margin of 10-12% from 2026-27 onwards.

In a strategic move to enhance operational synergy and streamline governance, the Board of Directors has approved the initiation of a merger process involving three of its group entities: SEPL, IPTL, and SSSDPL. This consolidation is expected to bring more value to shareholders by integrating operations in the same domain, including PCB manufacturing and skilling, which are critical inputs for the listed entity's EMS and semiconductor businesses.

Conclusion: A Path of Resilient Growth

Sahasra Electronic Solutions Limited is demonstrating a clear and disciplined approach to growth, marked by strategic diversification, continuous investment in manufacturing capabilities, and a proactive stance on market challenges. The company's strong H1 FY26 performance, coupled with its ambitious financial projections and strategic initiatives, positions it for sustained growth in the dynamic ESDM and semiconductor sectors. With a focus on both domestic and international markets, Sahasra is building a resilient business model aimed at long-term value creation for its stakeholders.