Srigee DLM FY26 Concall Decoded: PAT More Than Doubled, Yet Capacity Is Still Maxed
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1. Opening Hook
Srigee DLM’s H2 FY26 profit more than doubled year-on-year. The company is now sitting at ₹72.31 cr in annual revenue and plans to build a facility 4x its current size—but won’t start until August 15, maybe before Diwali, execution risk included. Management is swinging for ₹350 cr in turnover “at least,” though the next two quarters will see production hit pause while machines are moved. The real story: growth is capped by floor space, not demand. Everything hinges on whether a new plant on a 10,850 sq m plot actually lands on time.
2. At a Glance
Metric
Punchline
FY26 Revenue
₹72.31 cr; growth stuck at 1.53% YoY.
H2 PAT
₹5.53 cr, up 105% QoQ and more than doubled YoY.
Operating Margin (FY26)
7.99%—a 236 bps drop from FY25’s 10.35%.
EBITDA Margin (FY26)
12.18% (₹9.23 cr).
Other Income (FY26)
₹3.45 cr, up from ₹0.13 cr in FY25.
Capacity Utilization
Injection molding at 218% (overshooting rated 2,750 lakhs); polymer compounding at 41.14% (slack).
Top 10 Customer Concentration
91% of revenue (down from 95% last year).
Polymer Compounding Scale
50 MT/month now; target 150 MT/month at new facility.
Capex Plan
~₹25 cr (ex-land) for R11A facility; broader ₹50 cr project funded via IPO, bank debt, and asset sales.
New Facility Timeline
Commissioning target: post-Aug 15, before Diwali; 2 quarters of production disruption planned.
3. Management’s Key Commentary
On OEM Pricing & the Margin Trap:
“In our market, the OEM business is set. That format is already set. We don’t negotiate much.”
(Translation: OEM customers dictate margins. Srigee takes what the market allows.)
“If I manufacture that same thing in-house, it will cost me INR 90… saving INR 10… 10% to 20% saving. Plus, when I sell to other customers… earning a INR 20 margin—INR 10 from manufacturing efficiency and INR 10 from the sales margin.”
(Translation: Backward integration into polymer compounding is the only lever to escape the price-taker trap—cut internal costs, then resell the same capability at a margin outside.)
On H2 PAT Growth:
“This performance… is not only going to be sustained, but it is going to grow.”
(Translation: Current results will hold. Growth is next, once capacity constraint lifts.)
“The other income… has been added… That’s why… more increase in the PAT.”
(Translation: H2 PAT jumped partly because other income hit ₹2.91 cr in Q4 alone—a 22x jump from Q3’s ₹0.54 cr. Strip that out and the operating story is steadier but less dramatic.)
On Polymer Compounding (Polymos):
“We are aiming for a 3x expansion in this polymer compounding segment.”
(Translation: Current 50 MT/month → 150 MT/month; revenue ramp from ~₹1 cr/month now to ₹2.50–₹3 cr/month this year, then double that next year.)
“Approximately INR 1 crore monthly currently from one segment; conservative basis… INR 2.50 to INR 3 crores monthly this year… almost double in this financial year, and we will 3x it in the next financial year.”
(Translation: Polymer compounding is a small revenue base being projected to triple in 12 months. “Conservative” is aspirational language here.)
On Capacity Constraint & Diversification:
“We are utilizing 100% of our capacity.”
(Translation: No slack for new customers unless a new facility lands.)
“The moment I bring them for a visit, they ask where I will do the work. There is no space.”
(Translation: Three potential ODM/OEM customers are waiting. Srigee can’t close them until it builds the R11A facility.)
On New Facility Capex & Funding:
“We are not planning the Ecotech 10 facility right now because we shifted that fund to the new, larger plot. Why
