Sandhar overseas EBITDA rises 65% despite lower revenue

Sandhar Technologies Ltd reported H1 FY'27 overseas earnings before interest, tax, depreciation and amortisation (EBITDA) of €2.50 million, up 64.84% year on year, despite a 2.64% decline in euro revenue to €23.49 million; its parallel rupee table records EBITDA of Rs 27.51 crore and outstanding borrowings of Rs 548.00 crore.

How did Sandhar's overseas operations perform in H1 FY'27?

Sandhar's overseas operations reported higher operating profit even though revenue measured in euros declined. EBITDA rose to €2.50 million in H1 FY'27 from €1.52 million in H1 FY'26, a 64.84% increase that the presentation rounds to 65%, while revenue fell to €23.49 million from €24.13 million, a 2.64% decline.

The parallel rupee presentation shows a different revenue direction. Overseas revenue from operations was Rs 258.22 crore in H1 FY'27, up 7.46% from Rs 240.30 crore in H1 FY'26, while EBITDA rose 81.94% to Rs 27.51 crore from Rs 15.12 crore. The presentation reports both currency views but does not explain why euro revenue declined while rupee revenue increased.

Did Sandhar's overseas loss narrow during the half year?

Sandhar narrowed its overseas EBT loss to €0.88 million in H1 FY'27 from €1.79 million a year earlier. The source reports a 50.58% improvement, but the overseas subsidiaries remained loss-making before tax during the six-month period.

In rupee terms, overseas EBT improved to a loss of Rs 9.70 crore from a loss of Rs 17.79 crore in H1 FY'26, reducing the reported loss by Rs 8.09 crore. The presentation provides finance costs and depreciation at the consolidated level, but does not provide an overseas reconciliation from EBITDA to EBT.

The second quarter also recorded a narrower overseas loss than a year earlier. Q2 FY'27 EBT was a loss of Rs 5.62 crore, compared with a loss of Rs 6.27 crore in Q2 FY'26, while quarterly EBITDA increased 29.04% to Rs 12.95 crore. Q2 overseas revenue increased 10.30% in rupees to Rs 129.44 crore.

How much did Sandhar's overseas borrowings increase?

Sandhar reported outstanding overseas borrowings of €50.37 million in H1 FY'27, up 17.01% from €43.05 million in H1 FY'26. The rupee table gives the corresponding figure as Rs 548.00 crore, up 22.13% from Rs 448.70 crore, an increase of Rs 99.30 crore.

Gross block, including capital work in progress (CWIP), increased 7.56% in euros to €81.55 million from €75.82 million. In rupees, gross block including CWIP was Rs 819.38 crore, up 12.98% from Rs 725.25 crore, meaning the reported overseas asset base also increased over the comparable period.

Sandhar's equity held in overseas subsidiaries rose to €4.16 million from €3.25 million, a 28.00% movement. The rupee presentation shows equity held at Rs 30.29 crore, compared with Rs 20.29 crore, or 49.27% higher. The presentation does not provide a use-of-funds schedule, maturity profile or stated reason for the borrowing increase.

What does Sandhar disclose about overseas reserves and tax balances?

Sandhar's euro table reports accumulated reserves or losses at a loss position of €0.60 million in H1 FY'27, compared with accumulated reserves of €0.46 million in H1 FY'26. The table labels this movement as negative 229.45%, while the rupee table reports accumulated reserves of Rs 10.21 crore, down 34.87% from Rs 15.68 crore.

Deferred tax assets or deferred tax liabilities, abbreviated as DTA or DTL in the presentation, were reported at €1.33 million in H1 FY'27 versus €0.72 million in H1 FY'26. The rupee table lists DTA or DTL at Rs 10.39 crore, compared with Rs 1.16 crore. Sandhar does not specify whether the balance is a net deferred tax asset or liability, or identify the cause of its increase.

Overseas subsidiaries represented 8.6% of Sandhar's consolidated revenue geographical breakup in H1 FY'27. Standalone operations accounted for 48.6% and Indian subsidiaries for 42.8%, leaving overseas subsidiaries as the smallest of the three reported geographical revenue categories.

What overseas project is Sandhar pursuing next?

Sandhar lists a Romania project for seat-belt spools, operated through Sandhar Technologies Ro SRL, with an expected turnaround timeline of FY'28. It is the only overseas project in the five-item new-project overview, whose other projects are located in Hosur, Pune, Chennai and Haryana.

The full new-project overview shows investment of Rs 540.00 crore, revenue of Rs 312.00 crore, negative EBITDA of Rs 2.42 crore and negative profit before tax of Rs 25.09 crore. Those figures apply to the overall project list rather than Romania alone, so the presentation does not disclose a separate investment, revenue or profitability target for the seat-belt-spool project.

Conclusion

Sandhar's H1 FY'27 overseas disclosure combines a material operating improvement with continued pre-tax losses and higher borrowings. Euro EBITDA rose 64.84% to €2.50 million and the EBT loss narrowed to €0.88 million, while euro revenue declined 2.64% and outstanding borrowings reached €50.37 million.

The next disclosed milestone is the Romania seat-belt-spool project's expected FY'28 turnaround. Future overseas disclosures will show whether the project contributes to revenue and profitability, and whether Sandhar provides further detail on borrowings, the Rs 819.38 crore gross block including CWIP, and the reported reserves position.