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The 17th edition of Investor's Edge, released on July 16th, offers compelling insights. This issue highlights key takeaways from Q1FY26 concalls of noteworthy companies, alongside interesting business updates and corporate announcements. Let's dive in!
TATA Technologies
Demand scenario and the industry outlook
“The engineering, research and development segment of India’s IT industry, which relies heavily on outsourced work from U.S. and European clients, is seeing a broad slowdown as the global auto sector has been beset by concerns over U.S. tariffs, weak growth in China, sluggish EV adoption, and China’s export curbs on rare earths.”
One‑off drag in Services: phasing + VinFast ramp‑down
“In Services, revenue fell 1 % sequentially on account of the short‑term phasing of a number of large programs and the completion of our ramp‑down at VinFast.”
Management stresses the slowdown is temporary, not structural
““These customer‑specific headwinds are isolated and unrelated to overall market conditions, which we believe remain favourable as the manufacturing sector continues to future‑proof itself.”
Management’s optimistic from Q2
“The firm … is optimistic about a sequential recovery in the second quarter and a stronger second half of fiscal year 2026.”
Tejas Networks
Delay around revenue recognised and orderbook slowdown
“Order book at end of Q1: ₹1,241 crore and we expect an additional ₹1,526 crore PO for the ~18.7 k BSNL 4G sites (vs ₹1,019 crore in Q4 FY25).”
“Delayed receipt of PO and shipment of 18 k sites of the BSNL 4G network.”
“Revenue was lower due to delay in receipt of PO, and inventory‑arrival and shipment clearances for a few customers.”
“We won orders for routers under BharatNet Phase 3 and optical equipment from private operators in India. However, the shortfall in revenue was due to delays in receipt of purchase orders, including from BSNL.”
“The net loss of ₹194 crore was largely due to lower revenue, but we ended the quarter with an order book of ₹1,241 crore, up 22 % QoQ.”
“TCS received an APO for an additional 18,685 BSNL 4G sites; the upcoming PO for Tejas is valued at about ₹1,526 crore.”
Aris Infra
Brief Business model
“Our model is built on three essentials. Onboarding trusted suppliers and manufacturers, mainly MSMES to build a robust supply network, forming long-term partnerships with them and securing material availability to serve the growing needs of large developers and contractors. This allows us to operate as a tightly controlled execution engine handling both bulk material dispatches and project level services such as development management, inventory, marketing and project coordination for our customers. Just once for our customers, this translates into three clear benefits. Consistent supply of bulk materials, assured quality, and freedom from dealing with hundreds of suppliers and manufacturers. We provide an end-to-end execution system for materials, covering sourcing, quality checks delivery, and documentation. All driven by our own technology and operations. And we take full responsibility for all of these. This gives us the reliability and control of a manufacturer without the capital intensity or operational burden of owning and running clients assets. To date, we have built this network by onboarding over 1,800 small suppliers and manufacturers and have served nearly 2,800 plus customers across multiple sites and projects in India. This network also acts as a key driver of demand for our services and continues to deepen our role in project execution. Unlike typical project based businesses with a fixed order book. Our supply model runs on a rolling demand, daily repeat, high volume dispatches driven by long-standing customer relationships and secured capacity. This gives us a stable, visible revenue base without locking us into rigid long-term contracts. Our reserve capacity, diverse customer base, and execution depth ensure that we have consistent, predictable business flowing through every day over time. This core engine of Supply has naturally created opportunities to extend our role into project level services as mentioned before which now contribute a complimentary order book to our daily dispatch model strengthening both margins and customer stickiness through deeper integration.”
Solving Industry Inefficiencies at Scale
In a fragmented market where developers and contractors deal with numerous unreliable suppliers, ARIS Infra provides guaranteed supply, quality, real-time documentation, and disciplined coordination, streamlining operations for large projects and ensuring reliable payments for vendors. They absorb a significant execution load, which saves hundreds of man-hours and hidden operational costs
Rallis India
Cotton can be the good contributor to growth this year
“I think the important thing to understand is, yes, I think if you say next 2, 3 years, cotton is going
to be very, very important, but we are developing a robust pipeline in case of other 3 important crops for us, which is rice, bajra and maize. So -- and some of those products are being introduced this year, maybe at the end of the season, I can give you some idea in terms of what is likely to get a better trajectory and what is not likely to get. But yes, for coming 2 to 3 years, the cotton is going to be a significant contributor. Having -- look, cotton has challenges, but cotton has grown on 12 million hectare. Out of that, earlier, I mean now people are saying in Maharashtra, 25% of the cotton has become illegal Bt cotton. So out of 4, you take out 20%, about 1 million. I think -- so I always say out of 12 million hectare, you leave 20%, 25% area out. So we have to develop a product for the balance of the market, compete hard. And as and when government approves new technology, we transition to new technology.”
Driving Farmer-Centric Solutions by Balancing Margins Across Seeds, Soil Health & Crop Protection
“So obviously, structurally, you see all 3 businesses have a very different margin profile on a gross basis. So seed tends to be, depending on which crop you are, tends to be more high margin, gross margin business, followed by, I would say, soil and plant health portfolio. But in soil plant health portfolio also, if you start relying more on the bulker our margins drop followed by crop protection. Now within crop protection also, you know if you have a unique mixture of patented product, you can make more money.
If you're in a generic category, if you make technical, you make more money. If you don't make technical, you make less money. So it's always a blend. My feeling is that the way we are looking at, we are looking at, say, farmers -- so if there's a paddy farmer say in some districts of UP, am I able to supply them all what they need from crop nutrition perspective, seed perspective as well as -- sorry, as a crop protection perspective. As a result, you are able to actually optimize mix of your revenue and mix of profit. That's how we are approaching and that's what we call customer centricity, how do we get very focused, how do we increase our frequency of interaction with the customer so that we are able to take more share of the needs of the farmer.”
OLA Electric
Automotive Business Set for Free Cash Flow Positivity with Focus on R&D-Led Growth & EV Acceleration
“A few more things that I will just talk you through is, in this report, we have spoken about how our free cash flows in our automotive business are also stabilizing. Operating cash flows are already getting to neutral. And our CapEx plans for this year, FY26, are not very large in the automotive business. In fact, later in the graphs, you will see a lot of our CapEx is actually R&D, which is capitalized. We don't expect any major manufacturing CapEx in this year for the automotive business. There will be some for, let's say, our rare earth free magnet, etc. But beyond that, we don't expect any major manufacturing or growth CapEx for the automotive business. So the automotive business to get to free cash positive by the end of this year, which is what we are giving in the outlook, we do expect it to consume only about 400-500 crores of incremental cash from here.
But we do expect these next few quarters to be a little bit more steady in EV penetration growth. And then maybe another acceleration will happen as new products come in, as some of these next set of customers finally take decisions at scale to buy EVs, as our own distribution network becomes more productive in the smaller towns of India, specifically on the bike, as that unlocks a new category. So all of these levers will be playing a part in the next phase of growth. − And for now, the industry is in a steady growth phase. It's still growing 3x of the ICE industry. But hence, we've also taken up sort of a manoeuvring to consolidate our product, our business, our operations to get ready for the next phase of growth.”
HDFC LIFE
Steady Bancassurance Growth Aligned with HDFC Bank’s Trajectory, While Scaling Across Channels
“So we did mention that the counter share expansion in HDFC Bank happened in Q1 and H1 of last year. That is something that is now steady. So the growth that we get from HDFC Bank is going to be more reflective of how the bank grows, which has been fairly steady in this period. Other banks, Vineet spoke about earlier, are we continue to obviously compete in intense open architecture while maintaining our overall approach of growth, profitability and risk. And that's something that will develop as the year progresses. But all the channels are growing. Agency, we spoke about. And our aim for the agency business is what Vineet spoke about. But as far as the banks are concerned, I think all of them are growing reasonably well.
So we seem to be positive that, yes, it should pick up. One is the base -- in fact, the base effect of last year when the growth in H2 was actually slower than the growth in H1. So mathematically, it should look better. Second is as the fundamentals of the economy move, I think that would be something that we will also have to discover along the way. But so far, we believe that H2 should be better than H1.”
Growth might be softer this year compared to last year
“We take a slightly long-term view of 3 years. We do see expansion definitely. But from this year's perspective, I think, especially given that the growth at an overall level is likely to be relatively softer compared to last year. Last year, we were talking about 18%, 20% kind of growth. This year is likely to be lower than that. So the fixed cost absorption, as such, while it will even out through the year, it will still be slightly lower than last year. Our investments like Vineet mentioned, continue. So the product mix-related upliftment will actually get, in some sense, neutralized by some of these aspects. So I think that's not our objective for this period. VNB growth in line with the top line will continue to be the objective for this year. But from a 3 year, 5 year perspective, certainly, there is scope for expansion.”
ICICI PRU
Revival in Single Premium Products Driven by Declining FD Rates & Improved Annuity Appeal
“year after year, the business -- underlying business are slightly different between product lines. So even when you look at ULIP, the underlying business itself does change a bit. Specifically on the annuity, what we have seen in the environment right now, and we discussed this in the opening comments, there has been a drop in the FD rates that has made single premium a lot more attractive. The challenge last year or most of last year was that the sticker price when you walk into a bank for FDs was fairly high. And hence, there was no offtake for any single premium product, whether it be an annuity or otherwise. What you've now started to see in this quarter, is that an uptick in terms of single premium, primarily because when you see the sticker price at the FDs come down, these products have now started to become a little more attractive. And that's the kind of growth that we're starting to see at this point.”
Jubilant Pharmova (IR Day)
Roadmap for 2x revenue over the next 5 years
“So, I think from a capital allocation perspective, we have made our intent very clear that we want to be capital light. But having said that, you know we are targeting very specific capital allocation to 2-3 areas where we see a very high ROCE. First one is CDMO, where we’ve already invested almost 80% of US $285 Mn, 60% of which has come from the department of US, so I think some tail of around US $50 Mn odd has been left there which will be proportionately between us and the US government over the next year or so. Then, the next declaration we have done is for the PET pharmacy, another US $50Mn for 6 pharmacies, we see a very high asset turnover ratio and a high margin as we learnt during our course of interaction with Sophie and the PET pharmacy network that we have which we divested earlier this year and then we see some opportunity in contract research and development business which we will flesh out, we have yet to commit on any capital on that but as it go along. But, to sum it up, I think we want to be really really conservative and asset light in most of our, we have already taken out a lot of our R&D expenditure, as you all are well aware, in generics and many other businesses and we want to variabalise it and Radiopharmaceutical, which is an innovation led business, there will be some product development expenses for MIBG and a few others, but I think bulk of the expenses are behind us but on opportunistic basis, I think we would have some expenses there.”
Suprajit Engineering (Q4Fy25)
“In the midterm and the long-term, Suprajit is in excellent position. We acquired assets at the right time when things are moving offshore. But now with a lot of these Trump's and let's say, not just Trump, but also in Europe, a lot of moves towards pushing local and nearshore supplies, I think we are perfectly positioned with a footprint, both onshore and nearshore in U.S. and Europe. So that comes to my outlook and our outlook for the coming year. We expect that the group will have double-digit revenue growth. This is even excluded even SCS, we still expect to have double-digit EBITDA I mean, double-digit revenue growth, and we expect EBITDA margin to be 12% to 14%. We see a robust order book at SCD.”
Conclusion
As we've seen, the Q1FY26 earnings calls reveal a dynamic landscape across various sectors. From the temporary headwinds faced by Tata Technologies to the strategic pivots at Rallis India and the optimistic outlook for Ola Electric's automotive business, each company offers unique insights into the evolving market. HDFC Life and ICICI Pru are navigating shifts in financial product demand, while Jubilant Pharmova lays out an ambitious five-year roadmap. Finally, Suprajit Engineering positions itself strongly amidst global supply chain realignments.
These updates underscore the constant need for vigilance and adaptability in the investment world. Stay tuned for more in-depth analyses and subscribe to Investors’ Edge for your daily dose of curated business insights!
Thank you Team SOIC