RMC Switchgears blows past expectations in H1 FY25: 20% revenue jump and impressive profit surge

RMC Switchgears Limited has delivered strong financial performance for the first half of fiscal year 2025, underscoring its robust business strategy and efficient operations in an increasingly competitive market. In a press release dated 30th November 2024, RMC Switchgears announced significant revenue growth in its financial metrics, with revenue from operations rising by 19.86% year-over-year (YoY) to ₹104.78 crore, compared to ₹87.42 crore in the same period of FY24. The company also saw a 25.68% increase in profit after tax (PAT), which reached ₹10.13 crore, up from ₹8.06 crore in H1 FY24.

Revenue Surge Driven by Strategic Projects

The impressive revenue growth is primarily attributed to RMC Switchgears’ strategic focus on delivering advanced electrical infrastructure solutions and efficient execution of Electrical EPC (engineering, procurement, and construction) projects. These initiatives, particularly aimed at reducing transmission and distribution (T&D) losses for clients, have proven successful. As the company expands its involvement in the solar energy sector, the contribution from solar energy projects has become a critical driver of this positive trend.

Profit Margins Remain Resilient Despite Cost Pressures

RMC Switchgears’ PAT margin showed resilience, improving by 45 basis points to 9.67%, signaling strong fiscal management. Despite facing increased costs, notably an 8.85% decline in gross profit YoY and a 2.56% drop in EBITDA, the company has effectively navigated through operational challenges. The decline in gross profit was mainly due to higher Costs of Goods Sold (COGS), driven by shifts in project mix and increased operational costs. RMC Switchgears has made significant investments in talent acquisition and business expansion, setting the stage for future growth.

Earnings Per Share (EPS) Sees Impressive Growth

RMC Switchgears achieved a noteworthy 26.63% increase in EPS, rising from ₹7.81 to ₹9.89. This growth in EPS reflects the company’s consistency in creating value for shareholders while navigating an evolving market landscape.

Order Book Exceeds ₹850 Crore: RMC’s Growing Market Position

The company’s order book now exceeds ₹850 crore, with substantial contributions from its electrical products, electrical projects, and solar initiatives. RMC Switchgears’ solar energy projects, which constitute 53.8% of the total order book, are poised to become a major growth driver for the company. The company is also actively pursuing new opportunities under the Revamped Distribution Sector Scheme (RDSS), aimed at modernising India’s power distribution infrastructure.

Strategic Expansion and Future Outlook

RMC Switchgears is poised for continued growth, with a strategic focus on expanding its footprint in both renewable energy and electrical infrastructure solutions. The company is targeting the execution of approximately 800 MWp of solar energy projects over the next 9-10 months, marking a significant expansion of its solar business. Despite short-term delays in smart metering projects, RMC Switchgears remains optimistic about recovery and long-term profitability in this segment.

Additionally, RMC Switchgears is diversifying into new markets for electrical panels, particularly in high-demand sectors such as infrastructure, data centres, and industrial automation. The company is also focusing on underground cabling and feeder pillars, capitalising on government initiatives like the Integrated Power Development Scheme (IPDS) and India’s growing demand for urbanisation and smart cities.

Management’s Vision: Diversifying for Sustainable Growth

Ankit Agarwal, CEO and Whole-time Director of RMC Switchgears, shared his confidence in the company’s future growth, emphasizing its diversified approach. He stated, “We remain optimistic about the future due to our pipeline of pending orders and new opportunities under the Revamped Distribution Sector Scheme. Our solar energy projects and expansion into electrical panels and underground cabling markets position us well to capitalise on emerging trends.”

RMC Switchgears has also signed a Memorandum of Understanding (MoU) with the Government of Rajasthan to establish a 1000 MW Ultra Mega Solar Park. This collaboration underscores the company’s commitment to sustainable energy solutions and aligns with its broader vision to play a key role in India’s green energy transition.

About RMC Switchgears Limited

RMC Switchgears Limited is a leading provider of electrical infrastructure solutions, specializing in the manufacturing of electrical enclosures that enhance safety and prevent electrical theft. The company has established a reputation as a trusted partner for utilities and state entities, supporting India’s power sector modernisation. With a strong focus on renewable energy, RMC Switchgears is expanding into solar and green energy EPC solutions, aiming to contribute significantly to India’s clean energy transition.