HPL Electric Q4 FY26 Results (NSE: HPL)
Signal: Margin expansion
The read
Q4FY26 standalone reflects a diverging story: marginal revenue growth (+0.7% YoY) but operating margin expansion (+135bps) from cost discipline, yet PAT fell 12.2% due to a tripling of depreciation from recent capex. The metering segment (-7.2% YoY) remains a drag, while the Consumer & Industrial segment (+19.8%) is the growth engine. Full-year revenue grew 10.3%, but PAT slipped 4.3% as execution costs rose. The balance sheet shows higher leverage (net debt up 15%) to fund capex, though operating cash flow improved sharply. Margin trajectory is positive, but topline acceleration is needed to absorb higher fixed costs.
| Metric | Value | YoY | QoQ |
|---|---|---|---|
| Revenue | ₹511.77 Cr | 0.7% | 10.9% |
| EBIT | ₹38.99 Cr | -11.9% | |
| Net profit | ₹28.69 Cr | -12.2% | |
| EPS | ₹4.46 | -12.2% | |
| EBIT margin | 16.3% |
P&L walk
Q4 standalone revenue flat (+0.7% YoY) but cost control lifted EBITDA margin ~135bps to 16.3%; PAT fell 12.2% YoY due to higher depreciation and tax normalisation.
Segments
Metering segment revenue declined 7.2% YoY (₹29,781 lakhs) dragging overall growth; Consumer & Industrial segment grew 19.8% YoY (₹21,396 lakhs) and improved its segment result despite margin pressure. Total segment assets grew 14.5% YoY, with Metering accounting for 63%.
Key positives
- Operating margin expanded ~135bps YoY to 16.3% (computed EBITDA margin) despite flat revenue, driven by controlled employee and other expenses.
- Consumer & Industrial segment grew 19.8% YoY, now contributing 42% of standalone revenue vs 35% a year ago, signalling diversification.
- Operating cash flow more than doubled to ₹210.06 Cr in FY26 (from ₹130.89 Cr) indicating improved working capital management.
- Full-year revenue rose 10.3% to ₹1,858 Cr, maintaining growth trajectory above industry average.
Key concerns
- Net profit declined 12.2% YoY in Q4 (PAT margin 5.6% vs 6.4%) and 4.3% for full year, as depreciation jumped 132% from new capex.
- Metering segment revenue fell 7.2% YoY in Q4; its segment result also declined; pending smart meter orders may take time to convert.
- Inventory days rose to ~215 days (from ~195 days in FY25), increasing working capital lock-up and potential obsolescence risk.
- Net debt increased 14.8% to ₹705 Cr, partly from capex of ~₹152 Cr; leverage (D/E 0.75 from fundamentals) remains moderate but rising.
Research and educational content only. Not investment advice.