QCO compliance to impact margins near-term
Management expects continued mix of imported and localized content over next 6 months to meet QCO deadlines, pressuring margins.
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ABB India · forward-looking guidance across the available source record.
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margins
Large order pipeline conversion expected in H2
Management sees reasonable pipeline of large projects, expecting conversion in Q3/Q4 CY2025.
Margin band of 12-15% remains target
Management reiterated the 12-15% PAT margin band as a directional target, but noted near-term headwinds from QCO and forex.
Revenue Conversion Guidance
40% of Rs 11,900 crore order backlog executable in next two quarters with balance flowing through FY2027.
Capacity Expansion Target
Maintain 15-20% annual headroom in manufacturing capacity to capture incremental growth of 15-20% annually.
Short-term Margin Outlook
Operating leverage benefits expected in next two quarters if commodity prices stabilize at current levels, though headwinds to persist.
QCO Normalization
Quality Control Order (QCO) impact has relaxed with extended timelines and clarity on requirements now established.
QCO impact to persist 3-4 quarters
Management expects QCO-related margin headwinds to continue for another 3-4 quarters as certification processes remain slow.
Double-digit revenue growth ambition
Management aims to maintain double-digit revenue growth trajectory, supported by base orders and backlog execution.
Focus on bolt-on acquisitions
ABB India is actively pursuing bolt-on acquisitions to complement existing portfolio and enter new segments.