Sansera Q4 FY26: Record quarter, expanding margins, and the ADS inflection

Sansera Engineering ended Q4 FY26 with its strongest quarter on record. Revenue rose to INR 9,987 million, up 28 percent year on year. Profitability expanded sharply at every level. EBITDA grew 52 percent year on year to INR 1,929 million, lifting the EBITDA margin to 19.3 percent from 16.3 percent a year ago. PAT more than doubled to INR 1,231 million, and PAT margin improved to 12.3 percent from 7.6 percent.

The full year also marked a step change. FY26 revenue reached INR 34,979 million, up 16 percent year on year. EBITDA increased 23 percent to INR 6,321 million, taking the margin to 18.1 percent from 17.1 percent in FY25. PAT climbed 51 percent to INR 3,269 million and PAT margin improved to 9.3 percent from 7.2 percent. Management described FY26 as an inflection point, achieved despite global tariff disruptions, geopolitical volatility, and export headwinds in select segments.

A large part of the investment case now sits in the balance Sansera is building between its established Auto ICE franchise and the growth engines in Auto tech agnostic, xEV, and the Aerospace, Defence and Semiconductor business. In Q4 FY26, Auto ICE remained the anchor at 68 percent of sales, but non auto reached 19 percent, highlighting how the mix is shifting.

What drove Q4 strength: international momentum and non auto scale-up

Q4 FY26 growth was not limited to one pocket. The company noted that India business grew 18.5 percent year on year, while international business grew 47.4 percent year on year. Sansera also reported record quarterly topline in its international business, supported by multiple lanes of export demand.

Exports to other countries almost doubled during the quarter, primarily driven by the semiconductor business. Exports to the USA grew 25.9 percent year on year, supported mainly by non auto and passenger vehicles. The Sweden business posted its highest ever sales of INR 770 million, up 60.0 percent year on year. Exports to Europe excluding Sweden operations grew 43.0 percent year on year.

Within segments, non auto stood out with 70.4 percent year on year growth in Q4 FY26. Management attributed this strength primarily to ADS, which more than doubled year on year and is expected to continue to grow. Auto tech agnostic and xEV delivered its highest ever quarterly revenue with 19.8 percent year on year growth. Auto ICE also posted its highest ever quarterly performance, growing 21.6 percent year on year on a large base. Passenger vehicles grew 34.3 percent year on year and commercial vehicles grew 45.0 percent year on year, both at record quarterly revenues.

The quarter ended with the board recommending a dividend of INR 4 per equity share for FY26, which adds a capital return marker to a year where profitability and cash generation improved.

Mix matters: diversification is showing up in reported numbers

Sansera has been clear that its long term direction is diversification, with a stated commitment to raise emerging segments to 40 percent of revenue while growing the overall business. The FY21 to FY26 mix shows steady progress. Auto ICE has reduced to 70.1 percent in FY26 from 83 percent in FY21, even as that base business continued to grow in absolute terms. Auto tech agnostic and xEV rose to 13.5 percent in FY26 from 5.0 percent in FY21. Non auto grew to 16.4 percent from 11.5 percent.

The Q4 FY26 mix captures this transition in motion. Auto ICE contributed 68 percent, xEV 8 percent, tech agnostic 5 percent, and non auto 19 percent. The geographical mix also reflects a more global footprint, with Q4 FY26 at 62 percent India, 21 percent USA, 10 percent Europe, and 7 percent other foreign countries.

The diversification is not only about revenue stability. It is also a margin story. As ADS scales and the company moves into higher value add components in both auto and non auto, operating leverage and mix effects can support profitability. In FY26, EBITDA margin expanded to 18.1 percent and PAT margin expanded to 9.3 percent. In Q4, the expansion was sharper, suggesting execution benefits from improved volumes, better mix, and tighter cost management.

ADS is the headline growth engine, with backlog visibility and capex behind it

FY26 was also the year the ADS business moved from being an optional diversification theme to a material revenue contributor. ADS revenue for FY26 stood at INR 3,155 million, growing 155 percent year on year. In Q4 FY26 alone, ADS segment revenue was INR 1,097 million, following a strong Q3 at INR 1,194 million.

What makes ADS strategically important is not just the revenue run-rate, but the line of sight the order book offers. As of March 2026, the cumulative unexecuted order backlog for ADS stood at INR 44,638 million. Management indicated this backlog is executable in around five years, suggesting multi-year revenue support if execution remains on track.

Sansera also shared operating details that matter for risk assessment. Existing ADS capacity is 140,000 square feet, with two-thirds dedicated to aerospace and semiconductor and one-third dedicated to defence. The company plans capex of INR 2,500 million over the next few years toward building, machinery, and related needs. It also intends to add an 80,000 square feet ADS expansion within the existing campus to execute the current order book and support growth beyond FY27.

The commentary also points to the nature of the work mix evolving. The company highlighted vertical and horizontal capability augmentation, movement toward higher value add components, and faster transitions from first article inspections to commercial production. It is entering regular production of semiconductor parts, with ramp-up in 2026 Q3 and Q4 described as the stable period. The next leg includes more complex and large structural parts, supported by an in-house surface treatment facility.

For FY27, the company guided ADS revenue at INR 5,500 to 6,000 million. This is a meaningful step up from FY26 and frames ADS as a near term driver rather than a distant optionality.

Order book signals, and what changed at March 2026

Sansera reports its order book as peak annual revenues for new business. As of March 2026, this order book stood at INR 19,194 million. The company attributed limited order inflows from international customers to global uncertainties, but also clarified that the March 2026 order book reflects orders that moved to mass production as of April 1, 2026, with peak value expected to show in topline as these programs mature.

The order book mix at March 2026 was 54 percent Auto ICE, 17 percent tech agnostic, and 29 percent ADS. In the breakdown view, PV plus CV represented 35 percent and 2W 19 percent, indicating the legacy auto base continues to feed program wins even as ADS expands.

The longer history helps frame consistency. Closing order book moved from 13.2 in FY23 to 15.9 in FY24, 18.5 in FY25, and 19.2 in FY26, with new order wins in the 7.6 to 8.7 range in recent years. This suggests a stable engine of program additions, although the mix and timing may shift with customer decision cycles and macro conditions.

Capex discipline and balance sheet position

Sansera invested heavily through the cycle and still ended FY26 with a stronger balance sheet profile. FY26 capex was INR 5,097 million versus INR 5,911 million in FY25. The capex split shows 69 percent directed to plant and machinery, 13 percent to land and building, 13 percent to CWIP, and 5 percent to others. Within plant and machinery, the non auto share was 47 percent, reflecting the priority given to ADS and other non auto opportunities.

Management also provided asset turn targets that help investors assess capital efficiency. Automotive asset turns were indicated at 1.25 to 1.3 times, while ADS was indicated at 2.0 times, implying the company expects better revenue conversion from ADS investments over time.

On the balance sheet, total assets rose to INR 44,947 million at March 2026 from INR 42,053 million at March 2025. Total equity increased to INR 31,075 million from INR 29,758 million. Borrowings show a mix shift. Non-current borrowings declined to INR 956 million from INR 1,270 million, while current borrowings rose to INR 3,619 million from INR 3,008 million. Cash and cash equivalents increased to INR 1,037 million from INR 614 million.

Cash flow numbers underline that growth came with continued investment. Net cash generated from operating activities was INR 3,871 million in FY26 versus INR 3,766 million in FY25. Net cash used in investing activities was INR 4,414 million, lower than INR 9,548 million in FY25. The year ended with cash and cash equivalents of INR 1,037 million.

Strategic moves: Pantnagar capacity and Nichidai JV

Two strategic milestones defined the operating narrative in FY26. First, the Pantnagar facility inauguration in February 2026 added critical capacity to the ICE base at a time when management sees significant capex coming through from domestic auto OEMs. In the capex plan, Pantnagar Plant 16 is described as a new facility for crankshaft assemblies with a focus on domestic 2W OEMs.

Second, the company signed a joint venture with Nichidai Corporation, Japan. The JV, Nichidai Sansera Private Limited, is structured 60 percent Sansera and 40 percent Nichidai. Sansera plans to invest INR 500 million in one or more tranches. The JV will manufacture precision forged and machined parts in aluminium and steel for differential assemblies, compressors, driveline, and other advanced automotive components not currently manufactured by Sansera, for sale in India and overseas.

The strategic rationale is straightforward. Nichidai brings 50 years of expertise in dies, precision components, and filters across Japan and Thailand. Sansera brings customer presence and manufacturing scale in India. The value creation logic focuses on product diversification away from existing IC engine components, access to new customer segments and international markets, and strengthening competitive positioning in the automotive value chain.

Alongside these, Sansera continues to build optionality through its strategic investment in MMRFIC Technology Pvt Ltd, described as a partnership opportunity in advanced radar technologies and aerospace and defense qualified technologies. The company noted it has the right to invest and increase stake to 51 percent at a predefined valuation formula, and that further investment of INR 100 million has been made during the year, subject to shareholder meeting timing based on FY26 results.

Takeaways for investors

Sansera’s Q4 FY26 results show a company moving into a different phase. The quarter combined strong revenue growth with significant margin expansion, and the full year confirmed that the improvement was not a one-off. Profitability expanded even as the company continued to invest.

The most important development is the scale-up of ADS. FY26 revenue of INR 3,155 million and backlog of INR 44,638 million give the business both momentum and visibility. The FY27 guidance of INR 5,500 to 6,000 million sets a measurable near term target and will be a key marker for execution.

At the same time, the auto base remains healthy. Auto ICE delivered its highest ever quarterly performance, supported by record PV and CV revenues, and Pantnagar adds capacity for 2W crankshaft assemblies. The Nichidai JV adds a product pathway into precision forged and machined components that are tech agnostic and exportable.

The theme for the quarter is disciplined execution with strategic clarity. If ADS ramps as planned and the diversification mix continues to shift without sacrificing returns, Sansera enters FY27 with a stronger growth profile and a clearer multi-year runway.