/** blogpostTitle: Shivalik Bimetal FY26: Margin Expansion and the Move to Assemblies blogpostSlug: shivalik-fy26 blogpostShortTitle: Shivalik FY26 margins improve, assemblies ramp blogpostCoverImageDescription: An ultra-realistic corporate financial scene showing a clean desk with a laptop displaying three adjacent bar charts for FY26 segment revenue mix: Shunt Resistors, Thermostatic Bimetals, and Electrical Contacts, each around 40%, 40%, and 19% respectively. Next to it, a line chart shows consolidated EBITDA margin rising to 22.9%. In the background, subtle industrial elements like precision metal strips and a schematic-style outline of a welding process suggest Electron Beam Welding and diffusion bonding. Neutral lighting, professional finance aesthetic, no logos or text labels. */

Shivalik Bimetal FY26: Margin Expansion and the Move to Assemblies

Shivalik Bimetal Controls Limited (SBCL) closed FY26 with a clearer message than it has had in recent years: growth is being rebuilt around value addition, not just volumes. On a consolidated basis, revenue rose 12.3% year-on-year to 570.86 crore. EBITDA grew faster, up 26.0% to 130.72 crore, taking the EBITDA margin to 22.9% from 20.4% in FY25. Profit after tax increased 24.8% to 95.84 crore.

In the earnings call, management framed the year as a step in a deliberate transition. The company wants to move from precision materials and strips to engineered components and, increasingly, integrated sub-assemblies. That shift matters because SBCL operates in categories where qualification is slow, switching is painful, and small parts sit inside much larger systems. If SBCL can supply the finished component rather than a semi-finished strip, it typically captures a higher share of value without necessarily needing proportional capacity expansion.

FY26 performance: growth supported by mix and operating leverage

The reported improvement in consolidated margin came even as the business saw regional shifts. Management acknowledged that the Americas were soft during FY26, while Europe gained momentum and India remained an important driver for shunts. The performance was also supported by better realizations and operating discipline.

On the standalone numbers, the company showed a more modest top-line increase, with revenue from operations at 461.95 crore, up 5.66% year-on-year. Even there, profitability moved in the right direction. Standalone gross margin expanded to 49.39% in FY26 and EBITDA margin to 24.32%, reflecting a mix shift and cost control.

A key point in the call was that volumes are becoming less representative of value. Management noted that as SBCL moves to smaller, higher value-added components, kg volumes can decline even when revenue rises. That is consistent with the broader strategy of reducing reliance on strip-led supply.

Segment mix: shunts and bimetals remain twin engines

SBCL’s FY26 segment mix, as disclosed in the investor deck, is balanced between shunts and bimetals, with contacts as a meaningful third pillar.

Shunt resistors contributed 230.68 crore, or 40.27% of FY26 revenue. Thermostatic bimetals were at 231.25 crore, or 40.37%. Electrical contacts contributed 110.94 crore, or 19.37%.

The shunt story is increasingly tied to electrification trends such as EVs, battery management, and smart metering. In the call, the CFO shared a concrete datapoint on the move up the value chain. SBCL earlier supplied around 55% of shunts in component form, and that has risen to about 65% year-on-year. This change is yielding about 10% to 12% improvement in realization per kg versus the prior mix. It is a rare example of management giving a quantified link between strategy and economics.

Bimetals remain the legacy engine, but management was candid about domestic demand being flat. They attributed the muted India bimetals trend to slower consumption in key applications like switchgear, linked to end-market conditions rather than competitive losses. The stated response is to drive incremental bimetal volumes through exports, including targeting larger bulk-volume overseas opportunities if required.

Contacts saw a sharp jump in FY26, and management explained that the reported growth included a meaningful precious metal price effect. They said the revenue increase in contacts is partly due to silver price pass-through, and partly due to underlying business growth and capacity addition. Importantly, they also said the margin impact from silver price is limited, since only a small percentage is charged as a surcharge.

Strategy: assemblies, Pune, and a broader opportunity set

The most forward-looking element in SBCL’s FY26 narrative is the Pune facility and what it represents. The investor deck positions Pune as an R&D and CCS project hub, built to support forward integration into busbar connector solutions and PCBA assemblies. In the earnings call, management reinforced that the goal is to offer integrated, application-ready sub-assemblies for OEM and Tier-1 customers.

Management discussed early traction in busbar and CCS-related applications, with initial developments linked to two-wheeler EV programs. They also highlighted a key technical edge: some CCS designs require Electron Beam Welding (EBW), and EBW is an existing core capability for SBCL. The company is not limiting itself only to EB welded parts, but sees EBW as a differentiator where it applies.

On revenue potential, management stated that the new standalone Pune unit could bring in revenue in the range of 250 to 350 crore over a 2 to 3 year period, adding that three years is a safer expectation. This is not a formal guidance range, but it is a direct statement from management on potential scale.

Geographically, the company continues to push for diversification. Export mix was stated at 57% in FY26, with a footprint across 38+ countries and a subsidiary in Italy, Shivalik Bimetals Europe SRL, to strengthen customer engagement in Europe. In the call, management said Europe has emerged as a strong growth engine, supported by local presence.

Working capital and cash conversion: a clear watch item

FY26 also had a visible negative: working capital intensity increased. The investor deck shows inventory days rising to 204 from 184, collection days rising to 92 from 81, and net working capital days increasing to 258 from 218.

In the call, the CFO linked the increase to two drivers. First, copper consumption increased due to the new assembly-related business. Second, the company deliberately safeguarded supply in light of geopolitical uncertainty by procuring material against its order book. Management also stated it is working to reduce import dependency through domestic sourcing, which could support a reduction in inventory levels over time.

This matters because SBCL is positioning itself as a higher-quality, higher-value business. For that positioning to translate into consistent shareholder outcomes, the company needs its cash conversion cycle to not deteriorate structurally as it moves into assemblies.

What to track next

SBCL’s FY26 message is not built on one-off tailwinds. The company is arguing for a longer runway, built on electrification-led demand and a move up the value chain. The earnings call added useful clarity on how the shift from strip to components impacts realization, and how new platforms like Pune could expand SBCL’s addressable opportunity set.

At the same time, FY26 also shows where execution needs to tighten. Working capital expanded, and management continues to operate in export markets where demand can fluctuate by geography, as seen in the Americas softness.

The next phase will be defined by three measurable outcomes: whether the US shunt customer recovery translates into component-led revenue and profit contribution, whether Pune ramps in a controlled way, and whether working capital normalizes as the new mix scales.