This article first appeared on GuruFocus .
Release Date: February 10, 2026
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
Positive Points
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Suprajit Engineering Ltd ( BOM:532509 ) reported a consolidated revenue growth of 8% for the nine months ending December 2025, indicating strong performance.
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The company declared an interim dividend of 150%, up from 125% last year, reflecting confidence in its financial health.
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The electronics division experienced robust growth of nearly 20%, with EBITDA margins reaching 11.2%.
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The Matamoros plant received the Ford Q1 Award, highlighting operational stability and excellence.
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New business wins have started in the SCS division, indicating renewed customer confidence and strategic positioning.
Negative Points
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The company faced one-time costs in the controls division, impacting overall performance.
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Geopolitical risks and trade uncertainties continue to pose challenges for the global platform.
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The Phoenix lamps division remained muted due to a sharp reduction in exports to the Middle East and competition from low-cost imports.
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Memory chip shortages and expedited shipment costs are ongoing risks for the electronics division.
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The restructuring process, including plant relocations and labor structure changes, led to redundancy costs and operational challenges.
Q & A Highlights
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Q: What is the normalized EBITDA margin for the SPD division this quarter, and can you quantify the one-time hit? A: The normalized EBITDA for the quarter is about 9.5%. The one-offs for the quarter are approximately $2 million, which is around 18 crores. This is only for this quarter, and earlier restructuring costs have been booked in their respective quarters. - Respondent: Unidentified_3
Q: Can you provide more details on the growth in the SCD division and the new customers acquired? A: We have been winning significant new contracts, which are now entering the start of production phase. The growth in the controls division was 13%, outperforming the global automotive industry's growth. This indicates that customers are placing larger and more strategic businesses with us. - Respondent: Unidentified_3
Q: Is it fair to say that Q4 will be the break-even quarter for SCS in terms of EBITDA margin? A: We have stated that by the end of this financial year, SCS will turn the corner and be EBITDA positive. We stand by that statement, and there are no significant one-time costs expected in Q4. - Respondent: Unidentified_3
Q: What will drive the normalized margins for SCD and SCS in the next year? A: Once SCS turns around by the end of this quarter, the integration among various divisions will be reported as Suprajit Controls Division. The global auto component industry operates between 6% to 10% margins. Our aspiration is to reach 10% over time. - Respondent: Unidentified_3
Q: Can you provide insights into the JV for transmission cable rooms and the opportunity landscape? A: The JV with Jusu is progressing well, with RFQs received from key Japanese OEMs in India. It will take time to commercialize, but the pipeline is strong. The JV is a long-term association, and we are focusing on the East for export opportunities. - Respondent: Unidentified_6
Q: Why are you not utilizing deferred tax on losses to drive down the effective tax rate? A: We are taking a conservative approach. We are confident about the future, but for now, we have taken a prudent view. As subsidiaries revert to normal profit margins, the deferred tax assets will be used, normalizing tax rates over time. - Respondent: Unidentified_3
Q: What is the reason for the sequential decline in gross margins in Q3? A: The decline is primarily due to the timing of tariff impacts. The tariff amount has been significant, and while we have confirmation from customers for payment, it is a timing issue. Once the tariff amount is received, it will normalize gross margins. - Respondent: Unidentified_3
Q: Can you provide more clarity on the restructuring and one-off costs? A: The restructuring and one-off costs are primarily related to the consolidation of SCS and other divisions. We will provide more details in our final numbers at the end of the year. We aim to give some color to these concerns in our next PR. - Respondent: Unidentified_3
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
