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Sugs Lloyd Q1 FY27: Mix Shift to T&D, Stable Margins, and a Bigger Push into Products

Sugs Lloyd Limited opened FY27 with a strong first quarter, even as management repeated that Q1 is usually the lightest period for outdoor execution businesses. On a standalone basis, revenue from operations rose to 78.40 crore in Q1 FY27, up 32 percent year on year from 59.41 crore. Profitability moved in line with the top line. EBITDA increased to 11.99 crore, up 35 percent year on year, while profit after tax came in at 7.50 crore, up 30 percent.

What stood out was that the company managed growth without sacrificing margins. EBITDA margin improved slightly to 15.3 percent versus 15.0 percent in Q1 FY26. PAT margin stayed broadly flat at 9.6 percent versus 9.7 percent.

Management positioned the quarter as an outcome of execution momentum in Power T&D and smart grid, plus early signs that the company’s niche product strategy, led by Fault Passage Indicators, is widening its footprint across states.

The quarter was driven by Power T&D execution

The biggest change in Q1 FY27 was the revenue mix. Power transmission and distribution contributed 46.32 crore, jumping sharply from 16.34 crore a year ago. Solar EPC, in contrast, declined to 32.03 crore from 40.72 crore.

Management attributed this shift to concentrated execution on its large RDSS-led smart grid work, including a comprehensive smart grid mandate in Patna for a Bihar distribution utility under the centrally-funded RDSS scheme. In the concall, the CEO noted that this was the strongest ever first quarter for the company and stressed that the margin profile was maintained while scaling execution.

Solar was described as an evolving portfolio. Management said the market is moving from pure EPC terms, especially in rooftop solar, towards RESCO or capex plus RESCO structures. The company is repositioning towards longer-term contract structures and recurring revenue streams rather than purely one-off EPC.

Financial snapshot (Standalone)

Other disclosed Q1 FY27 items included depreciation of 0.08 crore, finance costs of 2.45 crore, other income of 0.78 crore, and diluted EPS of 3.41.

Order book visibility and tender pipeline

Sugs Lloyd reported a current order book of 807 crore as of 30 June 2026, which it described as 2.7 times FY26 revenue. Management indicated visibility of roughly 18 to 24 months on this backlog.

Beyond the order book, the company highlighted a qualified bid pipeline of more than 1,350 crore, with tenders at the final stage exceeding 1,200 crore. Management also noted that fresh awards during Q1 were 58.37 crore.

A key claim in the investor deck was that over 85 percent of the current order book is with AAA to AA rated counterparties or centrally funded projects, which the company said reduces risk of revenue realization and working capital stress.

Still, management acknowledged that timing of tender evaluations and closures is largely dependent on government and customer processes, which can introduce uncertainty in order inflow timing even when the pipeline is large.

Products as a margin lever and the FPI story

One of the more differentiated aspects of the Sugs Lloyd story is its niche products business. The company stated it has over 50 percent market share in Fault Passage Indicators in India. On the concall, management emphasized that each new utility customer adds more than just immediate order value because it expands the base for wider adoption.

During Q1, the company cited multiple wins that reflect this direction, including FPI and data communicator unit orders from Odisha and Madhya Pradesh. One of the Madhya Pradesh orders was described as integrated into a SCADA control center with five years of AMC.

Management repeatedly linked product scale-up with margin resilience. The chairman stated that product segments carry significantly better margins than EPC. In response to questions, management said it is confident of sustaining margins and expects the growing product share to provide further support.

On the development side, management discussed the compact FPI as a new generation product, and said it is in discussions with technology companies for technology transfer arrangements to accelerate product expansion. The chairman said compact FPI could be launched in the next 2 to 3 months if discussions materialize. Vacuum circuit breakers were described as under development, with a potential rollout timeline of about a year, while RMUs were described as being at an initial stage.

Management also clarified that while FPI production does not require incremental capex, VCBs and RMUs would require additional capital expenditure. However, no quantified capex number was provided in the call.

Working capital, leverage, and collection discipline

The concall gave a fairly detailed working capital update. Management said customer collections during the quarter were 100 crore against revenue of 78 crore, bringing trade receivables down by 10 crore. Trade receivables after Q1 were stated as 149 crore.

At the same time, borrowings increased from 68 crore to 91 crore, with management attributing this to working capital funding for the Patna project. Trade creditors reduced from 53 crore to 30 crore as the company paid suppliers. Fixed deposits increased from 50 crore to 68 crore, which management said was funded from internal accruals.

When asked about debtor cycles, management acknowledged that the company operates in a segment where government customers can lead to long receivable periods, and referenced an industry norm of around 180 days. It positioned the reduction in receivables as a gradual process rather than something that can change within a few quarters.

On funding outlook, management indicated peak borrowing for FY27 could be around 130 crore and said cost of debt is around 9 percent.

Guidance and strategic outlook into FY27 and FY28

Management reiterated its longer-term ambition clearly. The company targets revenue of 1,000 crore by FY28E, as stated in the investor presentation and reinforced during the concall.

For FY27, management also reaffirmed a revenue guidance of around 600 crore. In response to concerns that Q1 growth was only around 30 percent year on year, the chairman said billing that was expected in June slipped into Q2 due to initial teething issues in the Patna project, and also cited some supplier delays linked to raw material pricing and material shortages.

The company also flagged expansion into two new verticals:

1. Transmission: Management said a couple of tenders are in the final stage and that transmission should start contributing to revenue in the current financial year.
2. BESS: Management said it had earlier stepped back due to volatile pricing and uncertainty in long-term quotes. It has now re-engaged after seeing market stabilization and identified tenders in Rajasthan and Bihar. Management said BESS is a new line, and any contribution would be over and above existing guidance.

In a segment mix discussion, management gave a tentative view of what the company could look like at 1,000 crore revenue, indicating Power T&D could be about 40 to 45 percent, solar could also be similar, and the remainder would come from other businesses including products. It separately stated a target to take product revenue contribution to around 10 percent by FY28.

Takeaways

Q1 FY27 reinforced three themes that matter for how investors may track Sugs Lloyd going forward.

First, growth is increasingly being driven by Power T&D and smart grid execution, with the RDSS opportunity acting as a large demand tailwind. Second, the company is making a deliberate pivot in solar towards longer-term structures such as capex plus RESCO, which could change the quality of revenue over time. Third, niche products, especially FPIs, are being positioned as a strategic and margin engine, supported by new state-level wins and a development roadmap.

The key watch items remain working capital intensity, pace of order inflows, and how quickly products move from promise to scaled contribution. Management has reiterated the 600 crore FY27 revenue guidance and the 1,000 crore FY28 target. The next few quarters should show whether execution momentum and tender closures can support that trajectory while keeping leverage contained.