💰 Financial Performance

Revenue Growth by Segment

Consolidated revenue grew 24.7% YoY in Q2 FY26 to INR 439.9 Cr and 23.7% YoY in H1 FY26 to INR 752.2 Cr, primarily driven by the high-end refurbished ICT devices segment which now contributes 97% of revenue under the Electronics Bazaar brand.

Geographic Revenue Split

The company operates in 42 countries (up from 38), including India, USA, UAE, and new markets in Europe and South Africa. While specific regional % splits are not disclosed, international expansion in the Middle East and U.S. is cited as a primary growth driver.

Profitability Margins

Gross Profit Margin improved significantly to 19.9% in Q2 FY26 (up 541 bps from 14.5% YoY) and 20.5% in H1 FY26. PAT Margin increased to 7.4% in Q2 FY26 (up 88 bps) and 6.8% in H1 FY26 (up 101 bps) due to better procurement and higher-margin refurbishment sales.

EBITDA Margin

EBITDA Margin stood at 10.6% in Q2 FY26 (up 46 bps YoY) and 10.9% in H1 FY26. The company aims for a sustainable 10%+ margin, targeting a 75 bps annual improvement through operating leverage and structural cost efficiencies.

Capital Expenditure

The company is expanding physical capacity for enterprise-grade computers and servers, though specific INR Cr capex figures are not disclosed. It maintains an asset-light model, with Property, Plant, and Equipment valued at INR 32.4 Cr as of Sep-25.

Credit Rating & Borrowing

CARE Ratings assigned a 'CARE BBB-; Positive' rating. Interest coverage ratio was 2.49x in FY24. Total borrowings were reduced from INR 434.4 Cr in Mar-25 to INR 211.2 Cr in Sep-25 following equity infusion.

⚙️ Operational Drivers

Raw Materials

Used ICT hardware (laptops, enterprise-grade computers, servers, and high-end SSDs) represents the primary 'raw material' for refurbishment, accounting for the bulk of the cost of goods sold (COGS).

Import Sources

Sourced globally through a network of 601 suppliers across India, UAE, and the USA to ensure a steady pipeline of used technology assets.

Key Suppliers

Key strategic partnerships for procurement and refurbishment support include industry leaders such as Microsoft, HP, and Lenovo.

Capacity Expansion

Current global capacity is north of 120,000 units per month. The company is taking more space to accommodate larger enterprise-grade hardware and servers to meet growing institutional demand.

Raw Material Costs

Gross Profit of INR 154.4 Cr in H1 FY26 on revenue of INR 752.2 Cr implies raw material/procurement costs are approximately 79.5% of revenue, improved from 83.1% in H1 FY25.

Manufacturing Efficiency

The company processed approximately 300,000 units in H1 FY26 against a monthly capacity of 120,000 units, indicating a capacity utilization rate of approximately 41.6% for the half-year period.

Logistics & Distribution

Logistics is a major component of 'Other Expenses,' which represented 4.25% of revenue in Q2 FY26, up from 1.9% in Q2 FY25.

📈 Strategic Growth

Expected Growth Rate

20-25%

Growth Strategy

Growth will be achieved by expanding the distribution network (currently 4,515 touchpoints), increasing the sales team from 96 to 157 members, and penetrating new markets in Europe and South Africa. The company is also shifting focus toward higher-value enterprise-grade computers and servers.

Products & Services

Refurbished laptops, enterprise-grade computers, servers, high-end SSDs, and comprehensive warranty services.

Brand Portfolio

Electronics Bazaar (contributes 97% of total revenue).

New Products/Services

Expansion into enterprise-grade servers and high-end SSDs; these products are expected to drive the targeted 75 bps margin expansion.

Market Expansion

Targeting 42+ countries with recent entries into three European markets and South Africa during FY26.

Strategic Alliances

Partnerships with HP and Lenovo for refurbishment and distribution; Amazon Premium Pro Seller status for retail reach.

🌍 External Factors

Industry Trends

The global circular technology economy is growing as ESG mandates force corporations to dispose of assets responsibly. The industry is shifting from unorganized to organized players who can provide credible warranties.

Competitive Landscape

Competes with unorganized local refurbishers and new product sales from OEMs. The organized nature and scale (120k units/month) provide a cost and trust advantage.

Competitive Moat

Moat is built on a robust procurement network (601 suppliers), a proprietary refurbishment process, and the 'Electronics Bazaar' brand which provides a 100% comprehensive warranty, creating high switching costs for B2B clients.

Macro Economic Sensitivity

Sensitive to global IT spending cycles and corporate refresh cycles; high inflation may actually benefit the company as customers shift from new to more affordable refurbished ICT products.

Consumer Behavior

Increasing acceptance of 'affordable and credible' refurbished products over expensive new hardware, especially in price-sensitive segments and ESG-conscious corporations.

Geopolitical Risks

Potential U.S. tariffs on electronics; however, management currently anticipates no near-term impact on their specific refurbished product category.

⚖️ Regulatory & Governance

Industry Regulations

Subject to e-waste management rules and international trade regulations for used electronics. Compliance with global quality standards is maintained across facilities in India, UAE, and USA.

Environmental Compliance

The company operates within the circular economy framework, helping corporations meet sustainability and privacy goals through responsible asset disposal.

Taxation Policy Impact

Effective tax rate for H1 FY26 was approximately 12.6% (INR 7.4 Cr tax on INR 58.6 Cr PBT).

⚠️ Risk Analysis

Key Uncertainties

The primary uncertainty is the working capital intensive nature of the business, with negative cash flow from operations historically due to high inventory (INR 414.7 Cr) and receivable (INR 174.8 Cr) requirements.

Geographic Concentration Risk

While global, the company has significant infrastructure and financial exposure in India, the UAE, and the USA.

Third Party Dependencies

High dependency on OEM partners (HP, Lenovo) for refurbishment certifications and supply of genuine parts/support.

Technology Obsolescence Risk

Inherent risk in IT distribution; mitigated by OEM compensation agreements when new models are launched and existing models require discounting.

Credit & Counterparty Risk

Receivables increased from INR 67.6 Cr (Mar-25) to INR 174.8 Cr (Sep-25). The company offers 30-35 days credit to channels but claims a history of zero bad debts.