Rishi Laser Limited: Precision, Expansion, and a Vision for Growth in Q2 FY26

Rishi Laser Limited, a stalwart in India's laser cutting and sheet metal fabrication industry since 1992, has unveiled its Q2 FY26 earnings, painting a picture of strategic expansion and resilient growth. The company reported a revenue of ₹42.94 crore, marking a 9.83% year-on-year increase. EBITDA saw a robust 19.50% jump to ₹4.26 crore, with margins expanding by 80 basis points to 9.93%. Profit After Tax (PAT) also grew by 2.01% to ₹2.11 crore. These figures underscore the company's ability to navigate market dynamics while maintaining a strong focus on profitability.

The company's performance reflects a strategic shift towards higher-margin, complex jobs and improved utilization across its Pune and Vadodara plants. While the earth-moving industry faced sluggish demand, increased exports and a better product mix contributed to the positive financial outcome. On a half-yearly basis, revenues for 6M FY26 increased to ₹84.37 crore, up from ₹76.18 crore in the previous year, with EBITDA rising from ₹6.54 crore to ₹8.25 crore, and margins improving by approximately 100 basis points.

Strategic Initiatives Driving Future Growth

A cornerstone of Rishi Laser's growth strategy is the operationalization of its new Bangalore plant. This facility, spanning 70,000 sq. ft., is a strategic expansion aimed at meeting rising demand, particularly in the construction equipment segment. Management anticipates this plant alone will contribute ₹100 crore to the company's revenue over the next four years, forming a significant part of their 'Billion rupee topline' target. While the ramp-up has led to elevated manpower costs and short-term margin pressure, it is viewed as a deliberate investment for sustainable growth.

Robotic automation is another key focus, with six robots already installed at the new facility. This initiative is not just about efficiency but also about enhancing quality and reputability, which are critical for attracting new business, especially from demanding customers like Caterpillar. The company is even exploring automation as a new vertical, aiming for ₹10 crore in sales of automation products to other companies. The new paint shop facility, expected to be operational by Q4 FY26, will further enhance capabilities and is crucial for handling larger parts and export orders, which require stringent quality control.

Diversification and Market Outlook

Rishi Laser is also strategically expanding into the tubes segment, targeting infrastructure projects, furniture, and construction equipment. While the technology for this segment is in place, the company is working to achieve the 'right breakthrough' to scale up quickly. Additionally, an online portal for retail sales of cut and bent parts is in beta testing and expected to go fully live in December, aiming to streamline ordering and attract new customers, particularly for the Gujarat plant.

The company's revenue is diversified across various segments, with Construction Equipment accounting for 54.19%, Power 10.04%, Rail Transport 2.76%, and Others 33.01% for 6M FY26. Geographically, domestic sales constitute 85.75%, with exports making up 14.25%. Management is actively pursuing export opportunities, especially in Europe and the US, citing cost advantages and a broadening portfolio.

Management's Vision and Future Outlook

Management's guidance points to a strong future, projecting a 20% CAGR sales growth over the next three years with improved EBITDA margins. For FY27, a 20% top-line growth is anticipated, coupled with a 1.5% to 2% improvement in EBIT margins due to operational efficiencies. The company's robust working capital management, considered 'best in the industry', provides a solid foundation for these growth ambitions.

Despite acknowledging challenges such as overexposure to the cyclical yellow goods sector and gaps in senior leadership succession planning, Rishi Laser demonstrates a proactive approach. They are filtering out low-value orders, investing in advanced technology, and exploring new markets and verticals. The company's journey reflects a commitment to precision engineering, reliability delivered, and a clear vision for sustained value creation for its stakeholders.