AARTECH - Aartech Solonics

📊 NSE: AARTECH 🏢 Electric Equipment 📅 Last Updated: 12/13/2025 17:42

💰 Financial Performance

Revenue Growth by Segment

Total revenue reached INR 35.70 Cr in FY 2024-25, a 9% YoY growth. Key segments include Bus Transfer Systems (BTS), Control and Relay Panels (CRPs), and BestCase customized enclosures. Q2 FY25 revenue was INR 9.41 Cr, up 4% YoY.

Geographic Revenue Split

The company expanded into Uttar Pradesh, Himachal Pradesh, and the Middle East. While specific regional percentages are not disclosed, these areas are cited as key demand centers for geographic diversification.

Profitability Margins

Operating margins in key product lines improved by 10-15% YoY due to volume growth and better fixed-cost absorption. PAT for FY 2024-25 was INR 2.04 Cr, a 41% YoY growth. Adjusted PAT (excluding a one-time impairment) was INR 5.97 Cr.

EBITDA Margin

Q2 FY25 EBITDA was INR 2.03 Cr, representing a significant 185% YoY increase. This growth was driven by a shift toward high-margin advanced rating panels and operational efficiencies.

Capital Expenditure

The company is focused on enhancing its productive asset and resource base to support sustainable growth. Specific historical or planned capex figures in INR Cr were not disclosed in the provided documents.

Credit Rating & Borrowing

Interest expense on bank overdrafts was INR 11.65 Lakhs for H1 FY25. Net cash generated from financing activities was INR 49.47 Lakhs for H1 FY25 compared to INR 22.76 Lakhs in the previous year.

⚙️ Operational Drivers

Raw Materials

Key raw materials include copper, aluminum, and electronic components. Copper and electronics represent significant cost drivers and are subject to high price volatility.

Import Sources

Not specifically disclosed, though the company mentions navigating global commodity markets and managing cross-border project logistics.

Capacity Expansion

Significant improvement in Control and Relay Panel (CRP) production capacity utilization was achieved in FY 2024-25. Specific unit-based capacity figures were not disclosed.

Raw Material Costs

The company implemented vendor renegotiations and targeted procurement strategies to reduce cycle times and costs, helping to offset raw material price volatility in copper and electronics.

Manufacturing Efficiency

Efficiency was driven by improved capacity utilization in CRP production and optimized logistics and warehousing practices.

Logistics & Distribution

Logistics optimization was used as a strategic cost control measure to maintain margin stability against input cost pressures.

📈 Strategic Growth

Expected Growth Rate

15-20%

Growth Strategy

Growth will be achieved through geographic expansion into the Middle East and North India, scaling the newly launched trading business (FY25), and shifting the product mix toward advanced rating panels which offer higher gross and net profit margins.

Products & Services

Control & Relay Panels (CRP), Bus Transfer Systems (BTS), Ultracapacitors, Waste-to-Compost Machines, and BestCase customized enclosures.

Brand Portfolio

BestCase

New Products/Services

The company launched a trading business in FY 2024-25 and started manufacturing panels of advanced ratings to drive margin expansion.

Market Expansion

Target regions include Uttar Pradesh, Himachal Pradesh, and the Middle East to unlock new demand centers for BTS and CRP products.

Strategic Alliances

The company has an associate company, though its financial statements were delayed. Specific partner names for JVs were not disclosed.

🌍 External Factors

Industry Trends

The industry is shifting toward automation and AI-enabled control systems. Aartech is positioning itself by building talent pipelines in embedded systems and high-voltage design to meet this evolving demand.

Competitive Landscape

The company operates in a specialized electrical equipment market requiring high domain expertise; specific competitor names were not disclosed.

Competitive Moat

The moat is built on specialized domain expertise in niche electrical engineering (BTS/CRP) and customized solutions (BestCase). Sustainability depends on retaining highly skilled technical talent in a competitive market.

Macro Economic Sensitivity

Highly sensitive to commodity price cycles (copper/aluminum) and inflationary pressures on specialized engineering talent wages.

Consumer Behavior

Not applicable as the company primarily serves industrial and infrastructure sectors.

Geopolitical Risks

Geopolitical tensions pose risks to global project execution and delivery schedules in target export geographies like the Middle East.

⚖️ Regulatory & Governance

Industry Regulations

Operations are subject to export/import compliance norms and government regulations regarding electrical manufacturing standards.

Environmental Compliance

The company manufactures Waste-to-Compost Machines, aligning with environmental sustainability trends, though specific ESG compliance costs were not disclosed.

Taxation Policy Impact

Tax expenses for FY 2023-24 were INR 1.31 Cr on a PBT of INR 2.75 Cr. Standalone tax provision for H1 FY25 was INR 45.56 Lakhs.

Legal Contingencies

The company noted a delay in obtaining financial statements from an associate company, preventing its inclusion in consolidated results under the equity method for certain periods.