AFFORDABLE - Affordable Robo.

📊 NSE: AFFORDABLE 🏢 Engineering 📅 Last Updated: 12/13/2025 17:58

💰 Financial Performance

Revenue Growth by Segment

Standalone revenue grew 7.00% YoY to reach INR 160.69 Cr in FY25, up from INR 150.18 Cr. In H1 FY26, standalone income reached INR 44.58 Cr compared to INR 41.46 Cr in H1 FY25. The company operates in three segments: Welding Automation, Car Parking, and Warehouse Automation (Humro), with the latter providing additional RaaS revenue of INR 2-3 Cr in H1 FY26.

Geographic Revenue Split

The first two verticals (Welding Automation and Car Parking) are 100% domestic (India), while the third vertical (Warehouse Automation) is 100% export-oriented, primarily targeting the US market with future plans for Europe and Brazil.

Profitability Margins

Gross margins vary significantly by segment: Automation at ~35%, Car Parking at 20-25%, and the Warehouse vertical at 40-50%. Standalone Net Profit Margin was 3.73% in FY25, a slight decrease from 4.04% in FY24 due to a 3.45% increase in production costs. However, Q2 FY26 saw a major turnaround with a PAT margin of 16%.

EBITDA Margin

Standalone EBITDA margin for FY25 was 8.96% (INR 14.39 Cr). The company achieved a significant profit turnaround in Q2 FY26, with EBITDA margins reaching 23% (INR 5.96 Cr) compared to a negative margin in Q2 FY25, driven by cost optimization and design re-engineering.

Capital Expenditure

The company is executing an INR 80 Cr investment in its subsidiary. This includes INR 8-9 Cr for product sharpening/development, INR 24-25 Cr for inventory, and the remainder for customer acquisition and marketing in the US and India.

Credit Rating & Borrowing

The Debt-Equity ratio stood at 0.50 in FY25, a 14% increase from 0.44 in FY24. This increase supports the company's growth and working capital requirements as it scales its international operations.

⚙️ Operational Drivers

Raw Materials

Raw materials and direct costs represent 68.95% of total revenue as of FY25. Specific materials include steel, electronic components for automation, and welding equipment, though individual % splits per material are not disclosed.

Import Sources

Not specifically disclosed, though the company is actively re-engineering products to use different materials to reduce primary cost factors.

Capacity Expansion

The company has an order book of INR 140 Cr as of September 2025 to be delivered by the end of FY26. Expansion is focused on the US market through the Humro subsidiary to reach a billion-dollar valuation target within 4-5 years.

Raw Material Costs

Raw material and direct costs increased by 3.45% to 68.95% of revenue in FY25. To mitigate this, the management is focusing on design optimization and cost negotiations to improve gross margins.

Manufacturing Efficiency

The company is focusing on 'design optimization' and 'material re-engineering' to reduce the primary cost factors of its automation products, which led to the EBITDA turnaround in H1 FY26.

📈 Strategic Growth

Expected Growth Rate

20%

Growth Strategy

The company aims for a billion-dollar valuation in 4-5 years by focusing on the high-margin (40-50%) warehouse automation export market, investing INR 80 Cr in US customer acquisition, and maintaining a robust domestic order book of INR 140 Cr.

Products & Services

Welding automation systems, automated car parking solutions, and warehouse automation robots (Humro) including Robotics-as-a-Service (RaaS).

Brand Portfolio

ARAPL, Humro.

New Products/Services

Expansion of the 'Humro' product line in the US and introduction of Robotics-as-a-Service (RaaS), which contributed INR 2-3 Cr in H1 FY26.

Market Expansion

Targeting the US market for warehouse automation, with subsequent plans to explore Europe and Brazil once US revenue reaches a critical threshold.

🌍 External Factors

Industry Trends

The industry is shifting toward high-efficiency warehouse robotics and automated urban parking. ARAPL is positioning itself as a high-margin product company rather than just a service provider to capture this shift.

Competitive Landscape

Competes in the specialized automation space; key advantage is the ability to offer both domestic welding/parking solutions and high-tech export robots.

Competitive Moat

Moat is built on deep integration with automotive OEMs (Tata, Mahindra) and high-margin proprietary technology in the Humro vertical. Sustainability is driven by the shift from 20% customization to standardized high-margin products.

Macro Economic Sensitivity

The business is highly sensitive to the real estate cycle (for car parking) and industrial CAPEX cycles (for welding automation).

Consumer Behavior

Increasing demand for automated parking in Indian 'Smart Cities' and real estate projects (Lodha, Rustamji) is driving the domestic order book.

Geopolitical Risks

Expansion into the US and potentially Europe/Brazil makes the company sensitive to international trade relations and local regulatory standards for robotics.

⚖️ Regulatory & Governance

Industry Regulations

Operations comply with Indian accounting principles and general corporate governance; the US subsidiary must adhere to US OPEX and marketing regulations.

Environmental Compliance

The company has established a Risk Management and Sustainability Committee to oversee ESG and operational risks.

Taxation Policy Impact

Tax expense for FY25 was INR 2.23 Cr, including deferred tax charges.

Legal Contingencies

The company maintains internal control systems to prevent fraud and errors; no specific pending litigation values were disclosed in the provided documents.

⚠️ Risk Analysis

Key Uncertainties

The primary uncertainty is the successful scaling of the US subsidiary, where INR 80 Cr is being deployed. Failure to acquire customers at the expected rate could impact consolidated profitability.