This article first appeared on GuruFocus .
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Revenue from Operations:INR 515 crores, up 35% year-on-year, highest ever first-quarter revenue.
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EBITDA:INR 63 crores, up 9% year-on-year.
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EBITDA Margin:12.26%, moderated due to input cost volatility and changing revenue mix.
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Profit After Tax (PAT):INR 19 crores.
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Cash Profit:Increased by 21% year-on-year.
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Consumer and Industrial (C&I) Revenue:INR 278 crores, up 55% year-on-year, contributing approximately 54% of total revenue.
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Wire and Cable Revenue:INR 146 crores, up 79% year-on-year.
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Lighting Revenue:INR 56 crores, up 78% year-on-year.
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Industrial Switchgear Revenue:Grew 19% year-on-year.
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Metering and Systems Revenue:INR 234 crores, up close to 17% year-on-year.
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Order Book:INR 3,200 crores as of August 7, 2026, with metering and systems accounting for more than 96% of total orders.
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Distribution Network:Over 900 authorized dealers and more than 85,000 retailers.
Release Date: August 11, 2026
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
Positive Points
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Revenue from operations grew 35% year-on-year to INR 515 crores, the highest ever first quarter revenue, with C&I segment growing 55% and wire and cable revenue up 79%.
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Smart metering order book stands at INR 3,200 crores, providing strong medium-term revenue visibility and execution-led growth.
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Consumer and Industrial segment achieved its highest ever quarterly revenue of INR 278 crores, contributing 54% of total revenue, with growth broadening across lighting (up 78%) and industrial switchgear (up 19%).
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Distribution network expanded to over 900 authorized dealers and 85,000 retailers, supporting channel-led growth and cross-selling initiatives.
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Cash profit increased by 21% year-on-year, and finance costs have declined in absolute terms over the last three quarters.
Negative Points
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EBITDA margins moderated to 12.26% due to input cost volatility, particularly in metals and industrial plastics, driven by geopolitical disruptions.
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Gross margins compressed from 38% to 30% year-on-year, impacted by raw material inflation and a changing revenue mix.
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Higher depreciation from capacity investments moderated the translation of operating growth into PAT.
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Smart metering margins dropped by approximately 3% due to sudden price hikes in industrial plastics and metals, with a time lag in passing on costs.
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Manpower costs increased significantly due to a 40% rise in minimum wages in Haryana, adding to cost pressures.
Q & A Highlights
Q: With the current smart metering build-out, how many years do you think this goes on for, and is there a new wave of smart metering coming in terms of a new RDSS scheme? What are the other growth vectors you see coming into play? A: Gautam Seth (JMD & CFO) stated that smart metering is a very long-term story, extending beyond the current 25-crore meter program. He expects a "Smart Meter 2.0" with advanced technology and communication to follow, creating a 10-15 year runway. Beyond electricity, the company is entering adjacent areas like water meters and is exploring gas meters. He also noted that a utility in the Middle East has recently approved HPL's metering, opening up international market opportunities.
Q: Gross margins have compressed from 38% last year to 30%, driven by raw material inflation. What steps is the company taking to get back to historical margins? Are you entering into hedging contracts? A: Gautam Seth explained that the margin drop is primarily due to a spike in input costs (metals, industrial plastics) from geopolitical disruptions since February. He outlined a multi-pronged strategy: passing on price increases to consumers (already done in wires and cables and lighting), working on design changes and alternative materials in R&D, and leveraging long-term contracts for critical components like semiconductors. He noted that while the company is hopeful for a resolution to the conflicts, the supply chain teams are making full efforts to restore margins.
Q: Since Adani is acquiring Intellismart and there are news of acquiring an OEM with meter manufacturing capacity, how do you see this scenario? Is there a threat to the quantum of orders HPL will cater to in the future? A: Gautam Seth stated that the acquisition of Intellismart is positive for HPL, as they were a preferred vendor for both entities, consolidating their position. He downplayed the threat of Adani acquiring a manufacturer, noting that HPL's business is spread across multiple independent AMISPs and they are not dependent on one or two. He believes the market is moving towards consolidation where established players with consistent quality and technology will gain.
Q: With the cost going up on the metering side, should we now work with whatever average margins we saw this quarter on the metering side as the new baseline for current orders? A: Gautam Seth confirmed that on a conservative basis, the current quarter's margin level should be considered the baseline. However, he expects margins to improve by Q3 as price increases are passed on in new orders and cost-saving measures take effect. He noted that new orders have a lead time for supply, so the impact of better pricing will be seen later in the year.
Q: Can you give us a breakdown product-wise on how you are seeing progress in the C&I segment in the next coming two quarters? A: Gautam Seth highlighted that C&I growth is broadening beyond wires and cables into switchgears and lighting. He cited channel expansion (dealers, distributors, retailers) and the "one consumer, one family" cross-selling concept as key drivers. He announced the launch of a new generation of switches called "Cairo" and expects strong growth in lighting and MCBs. He confirmed the next two quarters look "pretty good" for the C&I segment.
Q: What are we doing to invest more in the channel network and growing the wires and cables segment? Is it sustainable for the next quarter? A: Gautam Seth confirmed the growth is sustainable and will continue. He highlighted that copper tonnage usage has increased 1.5 to 2 times year-over-year, indicating volume-led growth. The company is investing in BTL marketing, last-mile sales teams, and expanding its dealer/distributor network. The strategy is to bundle all HPL consumer products (switches, lighting, fans, wires) into the retail network to drive further growth.
Q: Are we looking at any backward integration in order to de-risk from supply chain disruptions? A: Gautam Seth detailed HPL's strong backward integration philosophy, citing in-house tool rooms, over 100 injection molding machines, and sheet metal manufacturing. He specifically addressed critical smart meter components like relays, stating that conscious efforts are being made to manufacture them in India, aligning with government directives. He indicated that while these are long-drawn processes, the company is working on them and will share more information as it becomes material.
Q: Could you share some details on R&D, especially on the switchgear side? How are new products like ATS 370, 390, and ACB accepted in the market? A: Gautam Seth stated that the switchgear R&D is now much bigger and more meaningful. He highlighted that the new ATS products are a natural progression in technology for HPL, which has been a market leader in the changeover segment for 20 years. He sees this as a growing, global product segment. He also mentioned ongoing work on integrating electronics and communication into existing switchgear, with results expected in the next two to three years.
Q: With the EU FTA happening, how are we positioned in terms of product certifications and channel partners to tap into this market? A: Gautam Seth confirmed that most of HPL's products, including the entire switchgear range, are already IEC compliant. He highlighted that their MCB is DECRA certified, and their in-house lab is also DECRA certified, which allows them to sell to almost 55 countries. He noted that while country-specific testing may be required, the existing compliance ensures they are well-positioned for the EU market.
Q: How do we look at revenue and margins in the coming years? Can we go back to 16-17% margins if the Middle East situation eases? A: Gautam Seth provided a strong revenue outlook for both segments. Smart metering has strong visibility for the next 3-5 years, while C&I is expected to see high double-digit growth in the next 12-18 months. On margins, he confirmed that if the geopolitical situation eases and supply chain disruptions reduce, the company can return to its historical 16-17% margin levels. He also noted that a 40% increase in minimum wages in Haryana has added to costs, but volume growth and automation will help mitigate this.
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
