Domestic tractor buyers are making the leap to four-wheel drive, and Carraro India is pocketing the dividend.
Consolidated profit after tax jumped 11% to ₹351 crore for the second quarter of FY27, up from ₹317 crore in the year-ago period. Total income surged 19% to ₹705.8 crore. Homegrown demand carried the quarter. Domestic revenue shot up 33% to ₹485.9 crore, easily cushioning a 4% contraction in exports, which slipped to ₹210.6 crore amid lingering global supply snarls and geopolitical friction.
Yet rising sales did not shield margins. Input inflation bit hard. Escalating raw material, power, conversion, and transport bills took their toll, trimming the company's EBITDA margin down to 9.2% from 10% a year earlier. Operating EBITDA crept up 10% to ₹65.2 crore, lagging behind topline growth as cost pass-throughs to vehicle manufacturers faced typical negotiation delays.
Agricultural equipment remained the company's primary cash generator, bringing in ₹330 crore during the quarter—a 29% surge year-on-year. Construction equipment drivelines chipped in ₹297.9 crore, climbing 12%, while backhoe loader transmissions saw strong traction during festive pre-buying.
| Metric (Q2 FY27) | Q2 FY27 | Q2 FY26 | YoY Change |
|---|---|---|---|
| Total Income | ₹705.8 cr | ₹593.1 cr | +19% |
| Operating EBITDA | ₹65.2 cr | ₹59.3 cr | +10% |
| Profit After Tax | ₹351 cr | ₹317 cr | +11% |
| Domestic Revenue | ₹485.9 cr | ₹365.3 cr | +33% |
| Agri Equipment Revenue | ₹330.0 cr | ₹255.8 cr |
Demand for agricultural 4WD axles outpaced the broader tractor sector. Indian farmers are buying heavier machinery, forcing manufacturers to rethink transmission options. In the construction wing, Carraro is ramping up its tele-boom handler axle platform for an international OEM, with two customer programmes moving directly into series production and another four to five undergoing prototype testing. Domestic tele-boom handler market volumes reached roughly 800 machines across the first half of the fiscal year.
Capital spending reached ₹20.4 crore in the first half of FY27, following a ₹41.7 crore outlay in FY26. Groundwork began on a new paint-shop facility, while technicians commissioned a side-drive sub-assembly line and a backlash machine. Both installations aim to clear bottlenecks on the 4WD line and scale portal axle capacity.
New driveline architectures are also entering the testing phase. Carraro's engineering services unit bagged a prototype order for an electric transmission project with Montra Electric, which is now headed for field trials. Carraro India Managing Director Dr Balaji Gopalan confirmed that the company developed seven prototypes during the first half, moving one directly into commercial production.
Cost recovery will dictate the pace of profit recovery over the coming quarters. Management acknowledged that profitability gains will hinge on expanding production volumes, squeezing operational waste on the factory floor, and gradually securing contract price adjustments from vehicle makers.
| +29% |