💰 Financial Performance

Revenue Growth by Segment

Net Sales grew 77.5% YoY from INR 221.29 Cr in FY24 to INR 392.71 Cr in FY25. However, H1FY26 revenue of INR 111.01 Cr showed a significant decline compared to H1FY25 revenue of INR 192.10 Cr due to the lumpy nature of project execution, with management expecting H2FY26 to be 3x heavier in execution.

Geographic Revenue Split

The company operates primarily in India with expansion into Southern operations and a presence in Singapore. Singapore operations contributed nominal losses in H1FY26 as the company is not pursuing new projects there, focusing instead on domestic growth in Tier-2 and Tier-3 cities like Indore and Tirupathi.

Profitability Margins

Gross margins fluctuated from 29.4% in FY24 to 24.9% in FY25. PAT margin was 5.3% in FY25 (INR 20.71 Cr) but dropped to approximately 2% in H1FY26 because fixed employee costs remained constant despite lower revenue. Management targets a recovery to 5-5.5% PAT margin for the full year FY26.

EBITDA Margin

EBITDA margin stood at 8.4% in FY25 (INR 33.05 Cr) compared to 9.0% in FY24. H1FY26 EBITDA margin compressed to 4.3% (INR 4.74 Cr). The company aims for 9% EBITDA margins in H2FY26 and 8-9% consistently from next year through higher-margin Design & Build projects.

Capital Expenditure

The company has acquired land to set up a fully automated modular production line for furniture and soft-suiting. This backward integration aims to capture the 5-6% of contract value currently outsourced.

Credit Rating & Borrowing

Net Debt to Equity is exceptionally low at 0.03x as of FY25. Short-term borrowings increased to INR 42.97 Cr in H1FY26 from INR 3.86 Cr in H2FY25 to support working capital for a growing order book.

⚙️ Operational Drivers

Raw Materials

Key inputs include modular furniture components, soft-suiting materials (5-6% of contract value), and MEP (Mechanical, Electrical, Plumbing) equipment. Specific material percentages are not disclosed, but Cost of Goods Sold represented 75.1% of revenue in FY25.

Import Sources

Sourcing is primarily domestic within India to support projects in cities like Mumbai, Pune, and Indore. Soft-suiting is currently outsourced to third-party vendors.

Key Suppliers

Not disclosed in available documents, though the company maintains strong banking arrangements with large private and PSU banks for operational liquidity.

Capacity Expansion

Current operations are managed by 54 permanent staff members. Planned expansion includes a new fully automated modular production line to internalize furniture manufacturing.

Raw Material Costs

Raw material and construction costs (COGS) were INR 294.91 Cr in FY25, a 88.8% increase YoY, tracking the high revenue growth. Procurement strategy is shifting toward backward integration to improve margins by 0.5% to 1%.

Manufacturing Efficiency

The company is transitioning from a pure contracting firm to an integrated player. Large projects (INR 100 Cr+) typically yield 0.5-1% higher margins due to procurement efficiencies.

📈 Strategic Growth

Expected Growth Rate

25-30%

Growth Strategy

Growth will be driven by a transition to the EPC (Engineering, Procurement, and Construction) turnkey model and increasing the share of 'Design & Build' projects. The company is bidding for a pipeline of INR 4,000 Cr with a 10% expected success rate and expanding into the GCC (Gulf Cooperation Council) markets.

Products & Services

Interior fit-out solutions, Design & Build services, General Contracting, and turnkey execution for corporate offices, R&D facilities, laboratories, airport lounges, and retail spaces.

Brand Portfolio

Eleganz Interiors.

New Products/Services

Expansion into self-manufactured modular furniture and soft-suiting via a new automated factory, expected to contribute to margin expansion by next year.

Market Expansion

Targeting international growth in GCC markets and deepening presence in Indian Tier-2/3 cities.

Market Share & Ranking

Self-identified as a leading provider of interior fit-out solutions in India for corporate and commercial spaces.

Strategic Alliances

Maintains a Joint Venture in Singapore, though currently scaled back to focus on domestic Indian opportunities.

🌍 External Factors

Industry Trends

The industry is shifting toward 'Design & Build' and turnkey EPC models as clients prefer one-stop solutions. There is an increasing demand for LEED Gold and Platinum certified green buildings, which ELGNZ is positioned to service as an IGBC member.

Competitive Landscape

Competes with regional interior firms and national contracting companies. Management notes that while small peers have 10-15% margins, they lack the scale to handle INR 200 Cr+ projects.

Competitive Moat

Moat is built on the ability to execute high-value, complex projects (INR 100 Cr+) that smaller regional peers cannot handle. This is sustained by internal MEP teams and a track record of zero bad debts with blue-chip clients.

Macro Economic Sensitivity

Highly sensitive to corporate CAPEX cycles and the commercial real estate market, as revenue is derived from office and laboratory fit-outs.

Consumer Behavior

Corporate clients are increasingly demanding end-to-end 'bare shell to functional' handovers to reduce coordination efforts.

Geopolitical Risks

Exposure to Singapore and planned GCC expansion introduces regional regulatory and geopolitical risks.

⚖️ Regulatory & Governance

Industry Regulations

Compliant with Companies Act 2013, SEBI Listing Obligations (LODR), and FEMA regulations regarding overseas investment in Singapore.

Environmental Compliance

The company focuses on LEED and IGBC green building certifications for its projects.

Taxation Policy Impact

Effective tax rate in FY25 was approximately 26.6% (INR 7.5 Cr tax on INR 28.21 Cr PBT).

Legal Contingencies

Secretarial audit for FY25 reported compliance with applicable statutory provisions; no major pending litigation or material fines were disclosed.

⚠️ Risk Analysis

Key Uncertainties

Revenue lumpiness is a major risk, where H1 performance can look weak (2% PAT margin) before H2 recovery. Execution delays in large-scale projects (like the INR 160 Cr airport project) could impact cash flows.

Geographic Concentration Risk

Heavy concentration in the Indian market, particularly Maharashtra (Mumbai/Pune) and Southern India.

Third Party Dependencies

Currently relies on third parties for 5-6% of contract value in soft-suiting, which impacts margin control.

Technology Obsolescence Risk

Risk is mitigated by investing in a new fully automated modular production line to stay ahead of manual contracting competitors.

Credit & Counterparty Risk

Low risk; management emphasizes that while margins are thinner on large projects, 'the money is 100% safe' with no history of bad debts from their client profile.