Precision Camshafts Limited (PRECAM) Earnings Call Transcript & Summary

Ladies and gentlemen, good day, and welcome to the earnings call for the quarter ended June 30, 2025, hosted by Precision Camshafts Limited. [Operator Instructions] Please note that this conference is being recorded. I now hand the conference over to Mr. Karan Shah, Whole Time Director, Business Development. Thank you, and over to you, Mr. Karan Shah.

Thank you. Good afternoon, ladies and gentlemen. I'd like to thank you all for being a part of this Precision Camshafts' Q1 FY '26 Earnings Conference Call. In case of any detailed questions related to finance, please e-mail your questions at cs@pclindia.in, and we shall provide you answers in a reasonable time. We have submitted our investors presentation for Q1 to the stock exchanges on August 25th and the same is available on our website. Investors are requested to refer to the same. I'd like to start with sharing that Precision Camshafts Limited reported a net profit of INR 25.6 crores for this quarter in comparison to a loss of INR 34 crores in the previous quarter and a profit of INR 18 crores in the corresponding quarter ended June 30, 2024. This increase in net profit is mainly driven by growth in the domestic business, effective control over cost centers and no impairment impacts in this quarter. Our subsidiary, MEMCO has reported a profit of approximately [ INR 7 crores ] during the quarter. MEMCO's total income for the quarter was INR 13 crores compared to INR 11.1 crores in the previous quarter. This is mainly attributed to the growth in business with the existing customers and addition of 2 to 3 new customers at MEMCO. We continue to face headwinds with our e-mobility subsidiary, EMOSS in the Netherlands. EMOSS earned a total revenue of approximately INR 16 crores in this quarter compared to previous quarter of INR 16.9 crores. And while the anchor customers of EMOSS remain strategically aligned, there have been reductions in customer forecast and deferred decision-making from new customers. We still continue to look for new opportunities in this business. Our e-mobility efforts in India are growing steadily. Happy to share that we have received new orders for conversions of diesel vehicles to 100% electric from customers in key cities like Pune and Nagpur. And our electric heavy commercial vehicle development is going as per plan, where our first vehicles would be ready by the end of this calendar year. However, I must add that due to these extremely challenging times in Europe, the automotive market continues to deteriorate. This has had a direct impact on the continued working of our group company, MFT. While MFT recorded a total income of INR 29 crores in this quarter, the company is faced with critical liquidity issues due to sudden drop in customer demand by over 30%. Key customers in the automotive sector have indicated significant volume drops for the rest of this year and we are closely monitoring the situation and will update shareholders of any further developments at MFT. In summary, Precision Camshafts continues to navigate both opportunities and challenges. We are committed to delivering value and driving growth across our diverse portfolio. And while Europe remains a challenging geography to operate in, business in India is growing strongly and offsetting this impact. Coming to the financial performance of the company. Starting with the stand-alone business, total income for Q1 increased by 11.2% quarter-on-quarter to INR 164 crores. EBITDA margin for Q1 is at 26% and PAT margin was 15.7%. Coming to the consolidated business. Consolidated income increased by 10.7% to INR 221 crores. EBITDA for this quarter increased by 16% to INR 41 crores, profit before loss -- profit before tax was INR 27 crores, and profit after tax was INR 18.8 crores and EBITDA margin at the consol level was 18.5% and PAT was 8.4%. MEMCO achieved a revenue of INR 13 crores. MFT achieved a revenue of INR 29 crores and revenue at EMOSS was approximately INR 16 crores. This summarizes the financial and operational summary of this -- of the company. And with this, I'd like to open the floor for questions and answers. Thank you very much.

[Operator Instructions] First question is from the line of Rakesh Hegde who is an individual investor.

So my first question is regarding the financial performance. So there is a huge surge in other income. So may I know the details of this? I mean, what is the breakup of other income?

During this quarter, you mean, sir?

Yes.

The other income is mostly related to finance income of the deposits and the amount that we cash on our balance sheet. But if you can please write us a mail at cs@pclindia.in, we will get back to you with exact details of the breakup if you can. I don't have these offhand with me.

Okay. And second question is regarding the EV business. So in the opening remarks, you mentioned that you have obtained new orders. So is that the domestic orders? Or are those international orders?

These are domestic orders, the new orders that I'm talking about are in India.

So how many vehicles, I mean they are planning to retrofit into 100% electric vehicles?

This particular order we are talking about is in several hundreds, but it is done in phases, of course. No customer is willing to retrofit a very large fleet in one go because you can understand that these vehicles are pulled out of operations to be converted and then put back into operations. So typically, it is in small batches of 15 to 20 vehicles at a time. But if you look at this customer, they are spread across India, and we have a commitment of several hundred vehicles that we want to convert for this customer. And we are starting in very key cities like Mumbai, Pune and Nagpur at this point.

Okay. So when do you expect the orders of these clients to impact our financial statements? When will the revenue start flowing in the financials?

So revenue has already been flowing in the financials since January of this year, but it is not significant enough to be shown separately at this point. But I think from next year onwards, it should have a more significant impact.

Okay. My last question is regarding the recent GST reduction proposal by the government. So do you see any positive impact out of this?

I think it's -- right now, it would not be fair for me to comment on this. Again, I would reserve this remark for our finance team. And that if you can please write to us, I will surely come back to you on this.

Okay. One last -- one last question from me is that what is the position of cash and cash equivalent and investments as on 30th June compared to 31st of March? Because in the quarterly financial results, you don't publish balance sheet.

Sir, I don't have financials available with me offhand, so it would be wrong for me to give a number at this point. Any questions related to finance, if you can just summarize all of your questions and write to us, within the next few days, we will get back to you.