Rico Auto Industries Limited Q2 FY26 Concall Decoded: 5% growth today, 20% margin dreams tomorrow, and land worth more than patience

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1. Opening Hook

Auto ancillaries were supposed to slow down, tariffs were supposed to hurt exports, and margins were supposed to stay boring. Naturally, Rico Auto ignored the script.

While global geopolitics played musical chairs and Donald Trump almost forgot auto components exist, Rico calmly told investors that margins will magically climb to 13%—and eventually 20%. Why? Because machines bought years ago are finally waking up, railways are paying 18–20% margins, and a 27-acre Gurgaon land parcel refuses to be sold for “only” ₹400 crore.

Between foundries moving from 40% to 90% utilization, Hosur greenfield capex quietly swelling debt, and U.S. exports growing despite tariffs, this concall was a masterclass in confidence.

Stick around. The margin story is just warming up, and the land monetization drama is far from over. 😏

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2. At a Glance

• Revenue up ~5% YoY – Slow burn now, hockey stick promised later.
• EBITDA margin ~9.9% – Slight wobble, management says “trust Q4.”
• Debt steady at ~₹670 cr – Borrowings moved, anxiety stayed constant.
• Exports up 22% YoY – U.S. tariffs blinked first.
• Railways margin 18–20% – Suddenly, steel feels sexy again.

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3. Management’s Key Commentary

“We are on track to reach 12–13% EBITDA margins by Q4.”
(Translation: Please ignore Q2, focus emotionally on March.) 😏

“All new products are above 15% margin.”
(Old products quietly look away.)

“Our foundry utilization will reach 90% next year.”
(Machines finally earning their keep.)

“Railway margins are now 18–20%.”
(Auto components meet government contracts—sparks fly.) 🚆

“Land offers of ₹400 crore do not satisfy shareholders.”
(Chairman wants ₹1,500 crore or nothing.)

“U.S. exports will grow 40–50% despite tariffs.”
(Turns out auto parts were not Trump’s priority.) 🇺🇸

“My aspiration is 20% margins.”
(Reality: 13% first, dreams later.) 😄

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4. Numbers Decoded

Source table

Metric	Q2 FY26	Commentary
Revenue	~₹1,250+ cr (est.)	Growth deferred to H2
EBITDA Margin	~9.9%	Patience required
Total Debt	~₹670 cr