Srigee DLM Limited FY26: Margins Improve, Expansion Becomes the Big Swing

Srigee DLM Limited closed FY26 with steadier growth and visibly better profitability, even as management repeatedly highlighted a key constraint: the company is operating at very high utilization and needs more space to scale. For FY26, revenue from operations was INR 72.31 crores, total income was INR 75.76 crores, EBITDA rose to INR 9.23 crores, and PAT increased to INR 6.87 crores. EBITDA margin improved to 12.18% from 10.51% in FY25, while PAT margin increased to 9.06% from 7.02%.

The second half of FY26 was particularly strong. H2 FY26 total income was INR 54.34 crores, EBITDA was INR 6.89 crores, and PAT was INR 5.53 crores. The company’s H2 revenue grew 46.26% year-on-year and PAT more than doubled, supported by improved execution and, importantly, a sharp increase in other income (INR 2.91 crores in H2 FY26 versus INR 0.06 crores in H2 FY25).

Business mix: injection moulding remains the core

Srigee operates across four business segments: plastic injection moulding and assembly, tool room and die manufacturing, mobile phone assembly job work, and polymer compounding and trading. In FY26, the business mix continued to be dominated by injection moulding and assembly, which contributed 75.78% of revenue. Polymer compounding and trading contributed 15.60%, mobile assembly job work contributed 7.82%, while the tool room remained a small contributor at 0.80%.

The segment mix matters because it defines both growth headroom and execution complexity. Injection moulding remains the backbone, but the management commentary suggests the under-scaled segments, polymer compounding and tool room, are viewed as potential profit and integration levers once physical capacity expands.

Capacity utilization shows why expansion is central

The investor presentation’s capacity table indicates very high utilization in injection moulding and assembly. For FY26, it reports production of INR 54.79 crores against installed capacity of INR 27.50 crores, implying 199.25% utilization. While this may reflect how the company defines “installed capacity” versus realized throughput, it aligns with management’s repeated statement on the call that the company is operating at 100% plus utilization and lacks storage and space to scale.

This constraint is also tied to customer onboarding. Management stated that new customers ask where inventory will be stored, and that current space limits the company’s ability to accept incremental business even when demand exists.

The new facility and consolidation plan

A major strategic theme in the concall was the shift in expansion plans. Management said the company is not proceeding with the originally discussed Ecotech-10 plot (around 2,000 square meters) and instead began construction on a larger 10,850 square meter plot (referred to as R11A). The reason cited was feasibility: building on a smaller site and shifting operations, only to shift again later, would add avoidable cost and time.

Management stated a commissioning target of after August 15, 2026 and before Diwali, while acknowledging common construction delays. The call also included capex and financing commentary. Management discussed capex of around INR 25 crores apart from land acquisition, and said funding will be a mix of IPO proceeds, bank debt, and sale of smaller unit land assets. The cost of debt discussed was in the 8% to 9% range.

This consolidation plan also has a margin logic. Management said operating four dispersed units requires duplicated infrastructure and staffing such as plant heads, guards, housekeeping, and power backup. Moving to one large facility is expected to reduce these overheads.

Polymer compounding under Polymos: integration and growth intent

Srigee’s polymer compounding effort, branded as Polymos, is positioned as both a captive supply chain lever and an external revenue opportunity. Management stated the company currently operates one twin-screw extruder and produces and sells around 50 metric tons per month. It also said internal captive consumption is around 35 to 40 metric tons per month, and internal sourcing could be around 25% to 30%.

The expected benefit is cost and margin control. Management explained that buying compounded polymer from an external supplier embeds that supplier’s margin. By compounding in-house, the company can potentially save that spread, while also building a standalone vertical.

Management also stated an intent to expand compounding capacity to 150 metric tons per month after moving to the new facility, indicating that current scale is limited by space.

Customer concentration remains a visible risk

The presentation shows that the top 10 customers contributed 91.50% of FY26 revenue. Management acknowledged the dependency and said customer diversification is a focus area. It also stated that the figure reduced from about 95% last year to 91% in FY26. Management said two prospective customers have visited the site and discussed layout planning, but onboarding is constrained until the new facility is available and audits are completed.

What to track from here

FY26 reflects a company that improved margins and reported strong H2 momentum, while operating with clear capacity constraints. The next phase hinges on execution of the new larger facility and how effectively Srigee converts added space into sustainable revenue without over-relying on other income or a concentrated customer set.

Management also provided forward-looking targets during the call, including a stated personal target of INR 100 crores turnover in FY27 and a plan reference of INR 200 to 250 crores for April 2027 to March 2028. These statements are directional and will need to be tracked against actual commissioning timelines and customer onboarding.

The core FY27 to FY28 thesis from the documents is consistent: capacity expansion, consolidation-driven savings, and deeper vertical integration via polymer compounding. The primary execution risks are equally visible: construction timelines, raw material volatility in crude-linked polymers, and customer concentration.