RMC Switchgears FY26: Revenue growth, margin pressure, and a push toward smarter distribution

RMC Switchgears ended FY26 with a clear contrast in its consolidated performance. Revenue from operations rose to 401.59 crore from 317.73 crore in FY25, but profitability softened. EBITDA declined to 47.10 crore from 52.36 crore and profit after tax fell to 22.45 crore from 30.89 crore.

The company attributes the margin compression to input cost inflation across key electrical and solar components, currency depreciation that raised import-linked costs under fixed-price contracts, and supply disruptions that required premium procurement during the year. Management also states that its approach to pricing has changed, with major EPC bids from Q3 FY26 incorporating explicit price-escalation provisions.

Operationally, the presentation highlights three revenue verticals and positions the model as integrated. Solar EPC remained the largest contributor, while Electrical Products and Electrical EPC are framed as complementary segments that also improve competitiveness in bundled tenders.

Business mix: Solar-led, with products and EPC as anchors

RMC discloses an FY26 revenue split across its three segments. Solar EPC accounted for 208.99 crore, about 52% of topline. Electrical Products delivered 96.48 crore, around 22%, and Electrical EPC delivered 96.13 crore, around 26%.

The presentation also provides indicative margin profiles for each vertical, suggesting Electrical Products at around 9%, Electrical EPC at around 18%, and Solar EPC at around 17%. While these are not presented as audited segment margins, they indicate how management views the profitability structure. The strategic narrative is that higher-value electrical technology can lift blended margins over time, especially as certified products gain scale.

PulseBox and the shift from commodity to certified technology

A key theme in the deck is the effort to move beyond legacy enclosures into “intelligent” distribution infrastructure. The company introduces PulseBox, described as India’s first IS 14772-certified smart LT distribution box. The presentation positions this product as addressing a gap between distribution transformers and end consumers, where monitoring, theft detection, and certified shock protection at the LT box level are described as limited.

The company claims field validation through proof-of-concept deployments across 5-plus states, with 10 pilot distribution transformers live and advanced commercial engagement in three states. The deck includes examples from pilots, citing sustained overload detection that was not visible to transformer meters. These points are presented as early traction signals rather than a full-scale commercial rollout, and the company also mentions setting up a dedicated manufacturing line without specifying a commissioning timeline.

Alongside the product strategy, RMC highlights capacity and infrastructure investments. It states that production capacity has been increased to 300,000 SMC enclosures annually, supported by ongoing capex of about 4 to 6 crore funded through reserves and term loans. On sustainability, it references a 249 kW solar plant at its manufacturing facility.

Orders, pipelines, and the execution backdrop

Management commentary highlights a widening opportunity set. The CEO states the company won its first Transmission EPC order in Rajasthan worth 70 crore, with billing starting in Q2 FY27. It also states Solar EPC order stood at 125 crore with 400 crore in active tenders, and Electrical Products is executing 35 crore against an 89 crore pipeline. The same commentary states the confirmed order book exceeds 800 crore, with active tender execution at 1,500 crore.

The broader demand context is tied to government programmes and sector investments. The deck references RDSS smart metering expansion and the National Electricity Plan transmission investment outlook, and it links these to demand for distribution infrastructure, enclosures, and EPC execution.

However, the financial section also shows that growth has been working-capital intensive. The efficiency ratios slide shows collection period rising to 161 days in FY26 from 138 days in FY25. The current ratio declined to 1.32 from 1.55 over the same period, and the debt-to-equity ratio increased to 0.79x from 0.53x. Finance cost increased on the consolidated P&L to 13.85 crore from 8.67 crore. These indicators suggest that cash conversion and funding costs will remain key monitoring points as the company scales.

Takeaways

FY26 reinforces RMC’s ability to grow revenue and expand into adjacent opportunities such as transmission EPC, while maintaining a diversified model across products, EPC, and solar EPC. At the same time, the year also highlights the sensitivity of margins to input cost inflation, currency moves, and supply disruption, with higher finance costs and longer collections adding pressure.

The company’s stated response is twofold: structural changes to EPC contract pricing via escalation provisions, and a push toward certified, higher-value products such as PulseBox. Execution progress on order-to-billing conversion, improvement in working capital efficiency, and evidence of scaled commercial deployment for PulseBox will be central to how investors assess the next phase of the company’s story.