Usha Martin: From Debt Reduction to a High-Margin Wire Rope

Usha Martin delivered a strong FY26, with the business continuing its transition toward high-value, specialised wire ropes and stronger balance-sheet discipline. 📊 FY26 HIGHLIGHTS • Revenue: ₹3,691 Cr | +6.2% YoY

• Operating EBITDA: ₹705 Cr | +18.1% YoY • EBITDA Margin: 19.1% • ROCE: 20.6% • Operating Cash Flow: ₹736 Cr • Standalone business: 100% debt-free • Consolidated Net Cash: ₹332 Cr 🔥 THE BIG SHIFT Over the last 5 years, wire ropes increased from 61% → 73% of revenue, while value-added products increased from 59% → 70%. This is important because Usha Martin is increasingly focusing on technically demanding applications across: → Elevators → Cranes & infrastructure → Mining → Oil & gas → Offshore wind → Specialised industrial lifting 🌍 India’s infrastructure expansion, offshore energy projects and global supply-chain realignment could provide a long runway for specialised rope demand. The company has expanded capacity by around 40,000 MT over the last three years and successfully shifted high-end OceanMax rope production from the UK to Ranchi. Going forward, management plans to invest around ₹200–250 Cr annually in technical segments. ⚠️ BUT THERE’S A MAJOR RISK The biggest concern is not the operating business — it is the legal and governance overhang. ED proceedings involve provisional attachment of Ranchi land parcels valued at around ₹190 Cr, alongside a CBI investigation concerning historical matters. The auditors issued a clean opinion, but this legal issue remains a significant monitorable. Other points to watch: • Contingent liabilities of around ₹231 Cr consolidated • Rising slow-moving inventory provisions • 12.5% of consolidated receivables classified as having a significant increase in credit risk • Certain CARO qualifications and audit-control observations . Neha Gupta SEBI Registered Research Analyst For educational purposes only. Not investment advice. Investors should conduct their own research.