Nelcast Q1 profit slumps 59%; cost pressures bite, price hikes lined up
Revenue flat at ₹345.4 cr, but EBITDA and net profit plunge on raw material and labour cost inflation. MD says price revision talks and new product launches should boost H2 earnings.
— 2 earlier stories on Nelcast Ltd. →What's new
- Revenue up 2.8% to ₹345.4 cr; net profit down 59% to ₹5.1 cr.
- EBITDA fell 38% to ₹20.1 cr on elevated raw material and labour costs.
- MD Deepak Reddy Ponnavolu notes price revision discussions and new product start in Q2.
Why this matters
The profit collapse is severe, but management's forward guidance offers a clear recovery path via price hikes and new product ramps. Execution in the next two quarters will determine whether the order book recovers meaningfully.
What we're watching
- Price revision benefits materialising in Q2 and Q3.
- New product volumes ramping from Q2 onwards.
- European order wins converting to revenue.
The full read
Nelcast's Q1 FY27 was a profit squeeze in slow motion. Revenue inched up 2.8% to ₹345.4 crore, but EBITDA crashed 38% to ₹20.1 crore and net profit slumped 59% to ₹5.1 crore, all thanks to raw material inflation and labour shortages. Managing Director Deepak Reddy Ponnavolu's commentary is the only bright spot: price revision talks are underway, new products start in Q2, and European orders are building. The next quarter will test whether those levers work quickly enough to reverse a 59% earnings hole.
Questions answered
- Why did Nelcast's profit drop so sharply in Q1?
- Revenue was almost flat, but input cost inflation (raw materials) and labour shortages compressed EBITDA margins, leading to a 59% fall in net profit.
- What is management doing to fix profitability?
- Nelcast has started price revision discussions with customers. The benefits should appear in coming quarters. It also plans to launch new products from Q2 FY27 to drive volume.
- When will the new products contribute?
- Production starts in Q2 FY27 and should ramp through the year, with meaningful volume impact expected in the second half.
- Is there any international growth opportunity?
- Yes, Nelcast has secured new business opportunities in European markets, which management says strengthens the long-term growth pipeline.
- How did revenue perform compared to the prior year?
- Consolidated revenue rose just 2.8% year-on-year to ₹345.4 crore, barely outpacing inflation.
- What is the company's debt position?
- Nelcast has a debt-to-equity ratio of 0.53 and a trailing ROE of 6.7%, indicating moderate leverage and modest returns.
Nelcast Ltd.
Latest quarter · Jun 2026
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All notes on NELCAST →- 27 Jul 2026 · 3:30 PM IST Nelcast Q1 profit slumps 59%; cost pressures bite, price hikes lined up
- today Nelcast sees margin recovery, new products to add ₹250 cr run-rate
- 1d ago Nelcast Q1 profit slumps 59% on flat revenue