/** blogpostTitle: Exim Routes FY26: Growth, ERIS efficiency, and the working capital test blogpostSlug: exim-fy26 blogpostCoverImageDescription: Ultra-realistic corporate office scene with a large wall-mounted dashboard showing a clean financial chart of revenue rising from roughly 72 to 121 to 207 crore across three years, alongside a second chart showing EBITDA and PAT bars, and a small panel with logistics metrics like containers per year increasing from 6,000 toward 10,000; muted blue and grey palette, no logos or text labels, sharp lighting, professional analyst workstation foreground with laptop and documents. blogpostShortTitle: Exim Routes FY26 growth and ERIS */

Exim Routes FY26: Growth, ERIS efficiency, and the working capital test

Exim Routes Limited closed FY26 with its strongest topline yet, supported by higher trade volumes and a broader global sourcing footprint. Consolidated revenue from operations rose to 207.23 crore in FY26, up from 120.67 crore in FY25 and 71.86 crore in FY24. EBITDA increased to 14.14 crore and profit after tax (PAT) to 10.18 crore.

The company positions itself as a technology-enabled recycling infrastructure player, focused today on recycled paper imports and trade execution. Its core platform, Exim Routes Intelligence System (ERIS), is framed not as a simple marketplace but as an operating system that combines price discovery, logistics intelligence, documentation workflow, and quality visibility.

Management’s first post-listing earnings call added useful operating context. The CEO described the business as a bridge between global recycling yards and Indian paper mills, where execution discipline matters as much as sourcing. The CFO underlined that FY26 growth was meaningful, but cash conversion lagged due to working capital build as the trading book expanded.

FY26 performance: strong revenue growth, but margin volatility

The topline story is clear. Revenue from operations grew 72 percent year-on-year to 207.23 crore in FY26. EBITDA rose 38 percent to 14.14 crore and PAT rose 35 percent to 10.18 crore.

However, margins moved in the opposite direction. EBITDA margin declined to 6.82 percent in FY26 from 8.51 percent in FY25. PAT margin fell to 4.91 percent from 6.26 percent.

Management attributed this largely to trade and logistics related costs. The CFO said “cost of services”, which is largely trade and logistics driven, was the biggest driver of EBITDA compression. He also said the company deliberately shifted its sourcing mix towards the UK and European markets, which carry higher logistics intensity but provide quality and consistency demanded by customers. Elevated oil prices and freight costs were also cited as additional pressure.

At the same time, management highlighted an improvement in underlying trading economics. The CFO stated that the core trading margin, described as gross profit from operations before cost of services, improved from 19.4 percent to 22.4 percent, an increase of about three percentage points.

Financial summary (consolidated)

A notable detail from the investor presentation is the domestic skew. In FY26, domestic sales were 193.64 crore, while export sales were 13.59 crore. This translates to a sales mix of 93.44 percent domestic and 6.56 percent exports.

Business model: trading engine with a services layer

Exim Routes’ operating model blends cross-border trading with platform-led enablement. The company describes an integrated service ecosystem across four pillars: paper recyclables trading, ERIS platform solutions, logistics and container handling, and management and consultancy services.

In the call, the CFO described two interlinked business segments. The product segment, which is the core trading business, delivered about 203 crore of revenue at an operating margin of about 5.5 percent to 6 percent (as stated). The services segment, which includes ERIS platform revenues, logistics services, and management consultancy, grew from about 3.9 crore to about 4.4 crore, and was described as higher margin than the product segment.

The strategic intent is straightforward. Trading is positioned as the heart of the model, because it creates the network, data, and repeat relationships. As that base expands, services are expected to grow as an added layer that improves profit mix over time.

The company also explained its “high seas” model, where Exim India acts as an intermediary buyer during transit and sells to Indian mills in INR before the vessel reaches India. Management framed this as attractive for mills because it reduces forex dependency, simplifies compliance, and can speed up execution. The direct model, by contrast, routes revenue at overseas subsidiaries where they sell directly to mills in USD.

ERIS: efficiency claims and the roadmap

The ERIS narrative is central to the investment case. Management positioned ERIS as a closed B2B platform designed for a market where trust, service, and operational reliability are critical.

On the call, the CEO said ERIS provides visibility of nearly 1 million tons of inventory in the system, worth around 300 million dollars annually, and described this as about 20 percent of the Indian import market. He also said the company is converting around 10 percent to 12 percent of this visible opportunity into actual business.

Management repeatedly linked ERIS to operating leverage. The CFO stated that despite 72 percent revenue growth, below-the-line operating costs fell from about 3.8 percent of revenue to 3.1 percent, with employee costs reducing from about 1.7 percent to 1.4 percent. This was attributed to automation and faster execution through ERIS.

From a platform development standpoint, the CTO described phased evolution. The near-term phase is focused on continuing to collect data and improve ERIS for internal optimization over the next 12 to 18 months. The next phase is intended to onboard more actors such as suppliers, logistics partners, and financiers, and create additional take-rate style revenue streams. The longer-term goal is for ERIS to become a reference point for pricing and logistics discovery for ecosystem participants.

Balance sheet and the working capital question

FY26 ended with a larger balance sheet. Consolidated total assets were 107.86 crore versus 47.62 crore in FY25. Trade receivables rose to 58.63 crore from 32.72 crore, and cash and bank balances increased to 17.32 crore from 2.38 crore.

Debt increased as well, largely on the short-term side. Short-term borrowings were 14.57 crore in FY26 versus 2.72 crore in FY25. Despite this, the company’s financial ratios in the investor presentation show improved leverage metrics, with debt-equity at 0.23 in FY26 and current ratio at 2.61.

The bigger investor concern is cash conversion. The CFO stated operating cash flow was negative about 19 crore in FY26, versus negative about 5 crore in FY25, driven by growth-funded working capital build. He said debtor days were broadly stable, moving from 99 to 103 days on a closing basis, while payables tightened because new sourcing yards start with tighter terms.

To address this, management outlined two financing actions:

1. A 20 crore debt facility with a Tier-1 bank, with the first tranche already drawn, aimed at supporting growth and replacing some older, higher-cost borrowings.

2. An invoice financing program with an initial limit of 2.5 crore, targeted to scale to 15 crore through the year, intended to convert receivables faster into cash.

Management also mentioned that the IPO raised 43.7 crore (net of expenses about 37.2 crore), with allocations including 9 crore for working capital, 7.1 crore for office space, and 14.5 crore for ERIS, with much of the ERIS spend planned over 12 to 18 months.

What to track into FY27

Management gave explicit FY27 guidance. The CFO stated a target of 30 percent to 50 percent growth in revenue and profit, aiming for 300 crore revenue at the upper end, while noting geopolitical and logistics uncertainty.

Outside the near-term, management also expressed an ambition to become a 1,000 crore revenue company over roughly five years, anchored on India’s recycled paper import market opportunity and additional diversification into other recyclables.

For investors, the near-term debate will likely center on three questions raised during the call.

First, whether margin volatility from freight and sourcing mix can be managed while continuing to grow volumes.

Second, whether receivables and cash conversion improve materially as invoice financing scales and supplier terms normalize.

Third, whether ERIS monetization can become visible in the reported services segment, which currently remains small versus the trading-led revenue base.

Exim Routes has delivered strong FY26 growth and has articulated a clear operating roadmap around logistics scaling, financing partnerships, and platform expansion. The next phase will be judged less by ambition and more by execution: sustaining growth while tightening the cash cycle and demonstrating that ERIS continues to translate into measurable operating leverage.