Ladies and gentlemen, good day and welcome to the IKIO Technologies Limited Q1 FY’27 Earnings Conference Call. As a reminder, all participant lines will be in the listen-only mode and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing “*” then “0” on your touch- tone phone. Please note that this call is being recorded. I now hand the conference over to Mr. Suyash Samant from Stellar Investor Relations Advisors. Thank you and over to you, sir.

Thank you. Good afternoon everyone and thank you for joining us today. We have with us today the senior management team of IKIO Technologies Limited, Mr. Sanjeet Singh – Whole-Time Director, CEO and CFO who will represent IKIO Technologies Limited on the call. The Management will be sharing the key operating and financial highlights for the quarter ended 30th June 2026, followed by a question-and-answer session. Please note this call may contain some of the forward-looking statements which are completely based upon the company’s beliefs, opinions and expectations as of today. These statements are not a guarantee of the company’s future performance and involve unforeseen risks and uncertainties. The company also undertakes no obligation to update any forward-looking statements to reflect developments that occur after a statement is made. I now hand over the conference to Mr. Sanjeet Singh. Thank you and over to you, sir.

Thank you all for joining the Q1 FY’27 Earnings Call. Our Presentation has been uploaded on the Stock Exchange and I hope you have had a chance to look at it. I would like to briefly touch upon the strategic progress we are making at IKIO and the performance during the quarter. Our focus continues to be on reducing our reliance on the traditional home lighting ODM business and building a more diversified portfolio across Lighting, Hearables and Wearables, Energy Solutions, Electronic Components, Automotive Lighting and other technology-led products. This strategy is steadily changing our revenue mix, with the other businesses becoming an increasingly important growth engine for the company. Global expansion remains another important pillar of our growth strategy. We now have presence across 20 plus countries while we remain focused on further diversifying and reducing our dependence on any single geography. Our key focus area has also been strengthening our manufacturing capabilities. Our new facilities are being developed to support new age products, exports and greater backward integration .Block 1comprising approximately 2 lakh square feet is already operational while Block 2 has been partially commercialized in Q2 FY’27.

Construction of Block 3 is progressing as planned. Together, these blocks will provide significant additional capacity to support our expanding product portfolio and future growth. This capacity expansion is complemented by our strong in-house R&D and backward integration capabilities.With over 3000 SKUs, an in-house R&D and product design team and capabilities spanning design, tooling, component manufacturing, assembly and testing, we are increasingly positioned to participate in higher value manufacturing opportunities.

Coming to our financial performance

The revenue from operations grew 41% year-on-year to Rs.169 crores in Q1 FY’27, supported by continued momentum across our diversified business portfolio. The growth reflects strong traction in the other business, improving momentum in home lighting ODM and an expanding contribution from international markets. The other businesses has delivered a strong growth trajectory, recording an approximately 54% CAGR over FY’23-FY’26. This momentum continued in Q1 FY’27, with revenue growing 53% year-on-year to Rs. 124 crores, driven by continued traction from new customers and across our expanding product portfolio. Revenues were, however, marginally lowered sequentially amid global trade tensions.At the same time, our home lighting ODM business continued to improve, with revenue of Rs. 45 crores in Q1 FY’27, up 16% year-on-year and 18% Q-on-Q, reflecting improving business momentum and new customer additions. Moving to profitability: EBITDA increased 94% year-on-year to Rs.22 crores, with EBITDA margin improving to 13% from 9.4% in Q1 of last year. PAT increased to Rs. 11 crores from Rs.2 crores in the same quarter last year. The improvement in profitability was primarily driven by revenue growth and operating leverage. Sequentially, however, profitability was impacted by higher raw material prices arising from war-led supply chain disruptions and higher employee expenses following the revision in minimum labor wages. We are engaging with our customers on pricing and expect these pressures to normalise in the coming quarters as revenue scale and operating leverage kicks in. Overall, we believe the quarter demonstrates the progress we are making in diversifying our revenue base, expanding our global footprint and building capacity ahead of the next phase of growth. The continued scaling of other business, recovery in home lighting ODM, new customer additions and the commissioning of additional manufacturing capacity provide a strong foundation for the company’s growth going forward. As we move ahead, our focus will remain on expanding into new products and adjacencies, strengthening our international presence, improving operational efficiencies and leveraging our expanded manufacturing and backward integration capabilities. With that, we conclude the presentation and request the moderator to open the floor for Q&A.

Thank you very much. We will now begin the question-and-answer session. The first question is from the line of Mayank Agarwal from Scientific Investing. Please proceed with your question.

Thank you for the opportunity and congratulations on the good set of numbers. I have a couple of questions. The first question is regarding the margin trajectory. Given the current quarter headwinds in the geopolitical scenario and manpower expansion, how do you see the margin trajectory going ahead once the normalization has been done and the operating leverage kick in?

Hi, Mr. Mayank. Thank you for asking this question. So, on the margin trajectory, we are actually still I would say in line to what we had guided for the year. Our margins would definitely have been slightly better compared to where we are today if the geopolitical scenario would have been normal or close to normal. The problem with the gross margins today is we are in times which I would say is similar to what happened during COVID because lead times have gone up like anything. And if you also follow the pricing of the basic raw material like metals, plastics, copper, even the electronic semiconductors, so the pricing has shot up like anything. And on top of that, the lead times of the electronic components have gone up from a generic 4-to-6-week lead time to in certain cases over a year. So, the effect of that is that we are doing a lot of spot buying like we used to do during COVID. And in the last year, you probably would have seen some normalization happening. And we were on that track, on that path. But the last few months due to the war scenario, things have changed drastically again. So, in order to make sure that we are in line with our deliveries and we are able to service our customers well, we are again like what we did during COVID, doing a lot of changes in terms of the electronics due to the change in the lead times plus pricing. So, this is the major reason which has hit the gross margin to that effect. But at the same time, I would also like to apprise that we are working really hard at the back end. We are talking to our customers. And on top of that, we are doing whatever possible in our strength in order to maintain the gross levels where we are today. Otherwise, the effect would have been even higher. So, we are doing all of what is possible to maintain the steady momentum.

Okay. One more question. Actually, across commercial and refrigeration and automotive segment and even if you look at the non-lighting segment, what gives the company a sustainable right to win? Like if you can elaborate on the key customer relationship and how do you see growth and contribution evolving from this segment over the years?

So, yes, so that’s a very interesting question. So, basically, what is happening and if you would have had a chance to go through the presentation also, then in the presentation also, we specifically highlighted the diversified revenue mix, how we are changing over the years. There’s a very good slide in the presentation which shows that change ranging from FY’23 going up to FY’26, where our shift from our conventional ODM home lighting business, where at one point in time, our dependency was way too high. And that was always something of concern for all the investors.

So, today, if you look at that mix, so other business has been growing steadily and the dependency also has come down drastically. So, just to give you an idea, just one second, at one point in time, we were somewhere close to around a little over 50% dependent on the ODM home lighting business. And today, if I talk of the same thing, like if I talk of last year, then that figure came below. So, from around 60% to now, somewhere close to around less than 20%. So, that is the kind of change that has happened. And that is due to our constant growth in the newer verticals. And even the other segments like our refrigeration segment, the in-store segment, plus the hearable and wearable segment is now doing fairly well. And even when I talk of the in-store segment, it’s been around 2 years when we expanded geographically also. So, even during the war period, we are still maintaining decent numbers. The kind of decline that we were expecting, that didn’t happen because even in that region, we have diversified geographically into many countries and not just restricted to 1 or 2 countries. If that would have been the case, the numbers would have been totally different. So, this is how we are placing our business because 6 years back, before COVID, the world was a completely different place as compared to where we are today. So, keeping all of that in mind, our main, I would say, focus or key area has been to diversify our business, first into different product categories, different verticals, and second into different geographies so that we don’t put too much of our eggs in one single basket. So, going forward, these will obviously be our growth engine Like automotive, we have recently started, we are making very good inroads into some very good customers, the industry leaders. And this category also holds a lot of opportunity, and not just into automotive lighting, but also into other areas. But that is something that will come at a later stage. But yes, so what you mentioned about commercial refrigeration, in-store lighting, automotive, and even the non-automotive or sorry, non-lighting categories also, a lot is happening in the background. And these will definitely be our growth engines.

Thank you. And like, if I can ask one more question, like, since earlier you had guided like, at the peak utilization, at a Rs. 300 crore base, a company can do 4.5x to 5x of asset turns. So, like, if you can just give an expected timeline to reach a full utilization, and at the peak utilization, what can be the margins? Earlier you had told it can go from current margin to 17% to 18% EBITDA margins.

Yes, so I mean, if you look at the EBITDA margins, from last, I would say around 15 to 18 months, so there has been a sort of a steady trend where the margins have been improving because ofall the new verticals, they started to kick in, they started to generate revenue, so we are leveraging the economies of scale. All of that is now, that has started happening. And talking of the asset turn, I’ve always said that we will definitely reach to the level where we were before making, infusing the capital into the business after post the IPO. So, that should happen. I mean, this is something that as a team that we discussed, and the way we are looking at the business, minus whatever is happening globally, because there are certain things which are out of our

control, which are not part of the plan, but then certainly something happens. So, if things sort of stabilize and remain clear for the next maybe 2 to 2.5 years, so we expect that to happen within the next maybe 3-3.5 yearsis what we are targeting.

And like, let’s suppose at the peak utilization, can we go back to the earlier margin we used to operate around 20% to 23%?

So, that I believe I have discussed about margins in the previous calls also. So, that is why it is safe to say that what we are looking at the way the business is progressing 17% to 18% is what seems feasible. And what is practically feasible, because earlier our business mix was sort of restricted. But today we are very much diversified and there are certain categories where the margins are lower than there are certain categories. So, that is how we intend to keep our business also growing because certain categories where we see a lot of growth in the near future, where we don’t have to really invest a lot into capital, but at the same time can bring out good revenues in the near future, but lower margins. But then there are other cases also where the revenue, the top-line is not going to be that big or the growth is not going to be that dramatic, but at the same time, the bottom-line is going to be better. So, the business mix is going to continue like that. So, that is why the feasible or practical number that we can think of is somewhere close to around 17% to 18%. Once we achieve certain levels of economies of scale, the new plants are also up and running with at least 50% to 60% of plant utilization.

Okay, great. And this one accounting question, like if you see the tax percentage, tax rate has been very variable in the last few quarters. And like this quarter, it has been around 35%. So, what should be the sustainable tax rate going ahead?

So, this has to do with the deferment of the reversal of tax. But going forward, these things will also sort of stabilize.

Thank you. The next question is from the line of Harsh Pingle from Suraag Capital. You may proceed with your question.

Hello. Good afternoon, sir. Firstly, thank you for the opportunity. There was a dip in gross margin numbers from 44%-45% to 41%. Any particular reason for the dip?

So, the gross margins like I’ve been talking about the gross margin because of the geopolitical tensions. So, like I mentioned in the previous, during the previous question also, the lead times, the pricing of the raw material, the costs for all of our products, the major, the 3-4 type of raw material or components that we use is all types of metals. And if you look at the pricing of the metals in the past 4 to 5 months only, you know, where the prices were during January, February and where they are today, there’s been a lot of volatility, prices have been going up. Then there was some slight correction. Then again, they went up. So, all of that is happening. So, metals for one, all sorts of, so we use a lot of MS, aluminum, copper in all the products that we manufacture. Then apart from that, the electronic components, so they’re not only the pricing, but the lead

time. So, semiconductor prices have gone up. They’ve actually doubled in certain cases, more than doubled and back to with 5x-6x higher lead times than where they wereat one point in time. So, I mean, still I am waiting for an order that I placed in January for a particular semiconductor part, which we still haven’t received. And the lead time generally for that part used to be around 4 weeks. But why we are still able to maintain the production growth and everything is because we are an ODM manufacturer. So, if that part, you know, I cannot wait for 6 months and tell my customers that I am not getting the part, you know, in stock. So, what we do is we keep changing the designs. We keep the parameters, specs, everything same, but we keep changing the design. This is the same strategy that we applied during COVID as well, which actually helped us in gaining a lot of market share too, where some of our peers were struggling. A similar thing is happening right now. And so that is the only reason the gross margin has got a hit. And in fact, because of the strategy, we are still able to make sure that that hit is not as high as the gap in the pricing is. That is due to our, the R&D team and our purchase team working together and making sure that one, we are able to provide the goods on time. And second, we are able to manufacture the products at a price, which is still reasonable for us to manufacture.

So, this 41% gross margin, 40%-41% gross margin is what you are saying is sustainable for the year?

Yes. So, see, again, coming back to the gross margin thing, last 4 months, the pricing has been very erratic. So, even if where we are today in terms of raw material pricing, we should still be able to maintain this gross level going forward, unless there is something which is, the war escalates or there are more countries getting involved, something like that. If that happens, then it’s going to be a different story. But looking at the scenario today and where the prices are today, they are not a normal range. But even if where they are today, we should be able to maintain these gross margins.

Sure. So, other question was regarding other businesses, the revenue has taken a dip again here.Is this a seasonality factor or some other thing that is going on again due to war?

So, basically, the dip, if you are looking at the dip, that is on Q-on-Q basis. But if you look at the numbers year-on-year so I think approximately last year, if I talk of Quarter 1, we did somewhere close to around Rs. 120 crores, just giving you an approximate number. And if you look at the business, this quarter around, we did the same value in the other business, in the other business segment. So, in this quarter, we did close to around Rs. 124 crores, which was the entire business from the last year quarter. So, Quarter 1, generally in our case, is always one of the leanest quarters. And then comparison with quarter 4 is generally something that we generally don’t do. But if you do a year-on-year comparison, that is where the real picture lies because Quarter 1 of last year is comparable to this one. And likewise, Quarter 2 and Quarter 3, because Quarter 1 is generally the leanest.

Understood. Sir just last question, could you help me with how do you look at other businesses, every business-like home, auto, hearable, wearable? Could you paint a picture for me of how do you see this year particularly?

So, if I talk of other business, like what I just referred to the kind of growth that we have seen, if you look at it from a year-on-year, perspective. So, that business has been steadily growing, growing at a good pace. And in fact, all the verticals are actually doing really well in the other business segment. And if this quarter, the war situation would not have been there, then definitely our numbers would have been even better. So, I would say that we missed an opportunity of close to around at least Rs. 10 to Rs. 15 crores of business that could have been possible if the situation would have been normal. So, the trend is going to be similar, although we are also focusing on the ODM home lighting business, we are adding new customers. So, earlier in the home lighting business, 95% revenue used to come from one single customer when I talk of the ODM home lighting business. But today, it is again getting diversified. So, within that portfolio, now we have around 3 to 4 customers, we are adding more. And that trend will also continue into the home lighting business. And that is why you also see some growth happening in that segment too. So, that will continue to happen. But definitely other business segments, because there is a lot happening. And we are in that path of continuously diversifying. So, the categories that today we talk of are not the only categories that we are working on. There are other things that we are working on too, which will eventually keep coming in the coming quarters.

Of all the verticals, which vertical are you most optimistic about for this year?

I cannot point out a single vertical to be honestbecause what we are doing in the Middle East is also showing a lot of promise.Although there is a war situation right now, but the moment the thing normalizes. So, there is a lot that is happening there, we are making some really good connections, we are adding more people in the team, we are diversifying there as well. So, there is a lot of traction happening in the developer segment there too, apart from the instore thatwhere we are already quite successful. So, that is something that will continue to happen. And if I talk of the domestic instore and ref, that will also continue to grow. Then automotive lighting, which we have very recently started, that also holds some good promise. But although that is new, the numbers are not going to be big, but definitely it holds a lot of potential. And also, the hearable and wearable segment that is there also we are doing consistently good now and margins in that vertical have also become somewhat reasonable where we were struggling during the first I would say 6 to 9 months. So, that also is now sort of on track. So, where we wanted to be so. So, these are the categories where I cannot really point out one single one, but all of these put together will definitely be our growth driver. And then there are certain other products in the non-lighting segment where like the product that we developed for Honeywell. So, that association is also going strong. And in fact, we are with them also thinking of some other regions apart from India also.

Thank you. The next question is from the line of Ankur Gulati from Genuity Capital. Please proceed.

Thanks team. The LED business growth seems to be higher, which is a bit of a positive surprise. Anything specific which led to this growth?

So, you are talking about the ODM home lighting business, right?

That’s right.

Yes. So, in the ODM home lighting business, like I mentioned earlier, we are adding - we’ve added some new customers. So, that new business coming from those new customers have sort of addedthe additional revenue to that vertical. And that, like I said, that will continue to happen. This momentum shouldwork out for the coming quarters also. And that is something that we are, that’s a different team that is continuously focusing on making sure that we add more and more customers to this vertical and make sure that there is some additional revenue coming out of this category, because it’s one of the oldest categories that we have in lighting. And we would definitely want it to, we would want to carry forward with the legacy of this business.

So, two questions to follow up. One, in earlier calls, the guidance given was that this business will stay flattish, especially because of signify impact as well. So, should we pencil in, let’s say, at least 20% growth from FY’26 base of Rs. 170 odd crore?

So, you are talking about the full year number, right?

That’s right.

Yes. So, the full year number that we achieved in during the last year, which was somewhere close to around 170.

That’s right.

So, that the average comes out to be around 42. So, the average of 42 was because I think from what I remember, the first few quarters were relatively better. And then there was some sort of dip, which was happening. So, what we are doing right now is we are just adding more customers and making sure that correction in the dip happens. So, if I talk of this year, also, then we are close to that average of Rs. 42 crores in Quarter 1 is the figure is somewhere close to around Rs. 45 crores, which is very close to the average of last year. So, that is why you can say that it’s a correction in the dip by adding certain new customers. And going forward, we could see some slight correction going forward as well. But the final number for the entire year should not be drastically different to what we achieved in the previous year.

Broadly 170. Give or take maybe an uptick of Rs. 10-15 crores is probably on the charts, but we will see how it goes.

Fair enough. And the other business grew by 53%. So, is it possible to give more details which sub-segment drove that growth?

So, honestly speaking, it’s a combination of all the segments. I mean, I cannot pinpoint a single segment which led to the growth because all of the segments contributed. If I look at all different segments, so if I am comparing year-on-year, so every segment, there is a growth. The only area where we could not see the growth or there was some decline in the revenue was from the UAE business, the Middle East or the Gulf business. And it has its own logic behind it because of the war situation. But at the same time, we are very well placed in that market, and the numbers are still very reasonable looking at the scenario. And we are doing much better than our peers there also in the Middle East. So, apart from that, all the other verticals, there has been really good growth and we would want to continue with the momentum and we hope that this war situation settles down so that we can do well in the Middle East also because in the last few months, there is a lot of hard work that has happened. And like I said earlier also, we are now entering into the developer segment market as well, which again holds a lot of potential.

Can you give us a broad EBITDA margin guidance for these two segments, the ODM and the other business?

So, the EBITDA margin that you see in ODM, which is somewhere close to around, if I look at the Quarter 1, there has been an improvement so which is somewhere close to around 8.4%. So, if I talk of the entire year, there is a lot of volatility happening right now because of raw material and everything. But I think if we should give or take half a percent here or there, we should end up close to this figure only for the year if the raw material pricing remains stable or starts coming down. And then on the group level also, even during the last quarter, when someone was asking me about the EBITDA for the next year, I told them that it is going to be around 13%-14% where we are in line with what we had thought of. It definitely would have been around 14% or maybe slightly better if the situation would have been different. But yes, this is what we are looking at for the year.

Sorry, Sanjeet, you said 8.5% for ODM, for the last year?

Yes. No, not for the last year, that 8.5% is for this quarter. 8.4% to be precise is for this quarter.

Just one second. Okay. So, out of Rs. 22 crores, only Rs. 4 crores came from this.That’s fair?

Yes.

Out of what value are you saying? Sorry.

448. So, your EBITDA is Rs. 22 crores for the quarter.

Yes. Rs. 22 crores for the quarter.

3.8 out of that is ODM, which will be Rs. 3.8 crores. So, your other business is 15% EBITDA?

Yes.

Fair enough. Can you give us more color on discussions on hearables and wearables? Any other new clients being signed with Honeywell? And third, there were more client signing happening in automotive lighting. So, if you just walk us through all three?

So, I will speak those one-by-one. So, in the hearable and wearable segment, we are definitely, I mean, if I talk of client addition in the last three to five months, we’ve probably added two to three more customers in our portfolio. And at the same time, what we are doing...

Sanjeet, when you are talking of these, if you can also tell us if there are proper production schedules have started coming from these clients, which can then give you, let’s say, 12 months, 18 months or two years visibility. Sorry.

Yes, definitely. That is what I was about to come to. So, when we started this vertical, what we were doing was basically you can say majority of job work and then even in certain cases where we were not doing job work, where we were doing the complete product, but that product was, again, determined by the customer. The customer used to tell us that they want this from this particular source. So, all of that was happening. And we were more focused on job work. So, we started with job work to get into the system of these players. And then we knew that by playing with our strengths, we will be able to then bring them into the category of ODM. So, now that transition has been happening since the past, I would say, few months. So, a lot of products today, approximately close to around 50% of the products that we are doing in this category, they are all ODM products or products which are brought on the table by our team. And then the customer selects those products. And that is how that journey has also started. So, they are putting in a lot of trust and faith now. So, that is one very big positive. And that is why we have improved our margins also, because we are bringing in the kind of products that we wanted to do from the very first day. Certain products where there are some special features or where the customer was not doing that sort of category or that product in his portfolio. So, we are doing that transition is happening and it’s a long way to go. And this is something that we would want to mimic our understanding of the lighting business. And we would want to do the same thing that we did with lighting, because in lighting also we were doing, we were bringing in kits from China. I am talking about way back in around 2012. So, that is how the journey progressed from bringing the finished products or the kits from China to today doing whatever it is possible in India. So, we would want to, we are on that path of getting there. There are certain products

which we have now developed and are manufacturing which are completely designed by our team, manufactured in-house. So, that holds a small portion of the total revenue in the hearable wearable business as of now. But going forward, this is our way to develop this vertical. So, this is about hearable wearable. And that is why we are now investing in, I would say, new designs, new tools, all of that is happening. And before going for investment or everything, we just make sure that we are aligned with the customer. And that is how we have developed certain range of products, which are, like I said, the tooling is also done in-house and then the manufacturing and everything is done in-house.

Just on H&W, is there a production schedule which you guys have finally got?

Yes, I mean, the number is now decent enough of the overall top line. If I talk of, the overall top line, we are doing somewhere close to around, maybe around 15% to 18%, it’s around 15%-16% is coming from hearable wearable. And we definitely have schedule because again, we are managing the lead times and everything. And to manage these lead times of anywhere between two to three months, we need to have a plan of at least three to six months. And that is what is happening with our customers. And I mean, we do have proper projections and plans going forward. In fact, with the bigger customers, we have discussions on what we intend to do for the next 10 to 12 months, what are the kind of products that they want so that they are in the pipeline, we bring those products, show to them and that all is happening now.

So, are you in a position to share that? What is the production schedule in hand for next 12 months? I am just trying to figure out what kind of revenue visibility you have today on H&W?

So, like I said, right now it is contributing close to around 15% to 17% of the topline. And going forward for this year, it will end up close to probably around this figure only 16% to 18% of the topline for the entire year. So, I think I should be able to answer your question that way.

Yes, that’s approximately Rs. 100 crores. Perfect. Okay. So, if you can just give us more color on Honeywell and then automotive lighting, please.

So, automotive lighting, like I said, it is fairly new. We have just, I think, from the month of May onwards, we started the actual production, May or June, I would say, we started actual production. Up until then, we were doing all prototyping, sampling, approvals and all of that. So, even after getting approvals, there are certain trials that these companies do. So, they take up small lots, do the trials and then they start placing orders. So, now that stage is gone. And now we are in the stage of going into manufacturing, proper manufacturing. And I mean, for this year, the number is not going to be very big, like I said earlier as well. But at the same time, it’s a very promising segment. And there is also some expectation that it might lead to some other businesses as well. So, I would probably not want to talk about that right now. But at the same time, we are already aligned with five of, I would say the industry leaders when it comes to these LED lights in the aftermarket category. So, five of the biggest names in the industry, we are already aligned with them, we have already approved and have started manufacturing for them.

And then going forward, our next phase would definitely be going to be working with the OEMs. That is something that will happen after we strengthen our position in this category. So, a lot is happening in the background for this category as well. So, I would request you to keep tuned to what we are doing. And I will bring up updates every quarter so that you have a better understanding of where we are headed.

That’s perfect. So, on the strategy side, you are onboarding with the OEMs, whether two- wheeler, four-wheeler or whichever part, can you give us a number of OEMs where you have been onboarded? I am guessing that once you have to get onboarded with OEM and then the tier 1 vendor has to source from you.

No, so what we are doing right now is we are manufacturing for some of the biggest brands in India. They have a vertical of supplying to the OEMs also. But right now, what they are buying from us is these products will go into the aftermarket, not directly into the vehicles to the OEMs, but in the aftermarket segment. And what is happening is that in the aftermarket segment also, very recently there has been a transition of people moving from conventional sources to LED lights. So, any person who wishes to today go out in the market and change their headlight source, that percentage is swiftly moving towards LED lights and that is where we are functioning. So, this is to have a proper grip of the market, experience of the market, and the very logical step, next step would definitely will be to work with the OEMs. So, that will happen in Phase-2. But today we are working for these brands who are selling in their own brand, these automotive LED lamps. And these are all tier 1 brands. So, all top of the line, it is not any local company who is working on a regional level. And, so they have a very good market share, all India distribution, all of that. And we are working with these players.

So, by FY’28, the OEM onboarding should be done. Is that a fair assessment?

That is what the plan is. You know, that is what we intend to do.

Okay. And then if you can give us more color on Honeywell?

Yes. So, Honeywell has been progressing well. Like we started with one or two products where they were having some concerns in the current, their current suppliers or the current way these products were made or assembled. So, we started some products like we are doing amplifiers, public address systems, fire alarm panels. So, there are certain products that we have started and there are a lot of products which are in the pipeline. So, now that we’ve shown them our capability of designing, developing and providing them with the complete solution. So, the trust levels have gone up and now we are working very closely with them. There are a lot of products which are in the pipeline. So, it eventually, because it’s a big company, it takes time for products to get approved and it’s a long process. But it’s definitely worth the wait. Now we’ve already started producing certain SKUs for them and that is part of the increase in the revenue and we expect that going forward the SKUs will probably by the end of the year should go up by 3 to

4x before the end of this year, where I mean the number of SKUs that we are producing right now.

So, this year, this is the last guidance year, otherwise it should be close to Rs. 550 crores. Rs. 100 crores out of that is wearable, which is the other big segment if you can quantify that.

So, the other big segment would definitely be the in-store lighting and the commercial refrigeration lighting. That is one of our conventional businesses also, in-store lighting in India and commercial refrigeration lighting and other electronics we’ve been doing for more than 10 years now, 10-12 years now in India. So, definitely there we enjoy a very good market share as well. And now that with the diversification into other geographies, so that is one of the other, I would say, big revenue, this thing.

So, this business was roughly Rs. 210 crores last year, right, which is ILC. And Gravus and Luminati was under the same business?

Yes, so Gravus and Luminati are very new initiatives. These are very, very new initiatives. They don’t really contribute to the revenue as of now to that extent that where we need to mention about these brands or names. But there is a very specific, I would say, understanding of why we brought these into the market because we saw that there is a very, very big opportunity in India in terms of the category where we have positioned the products under these two brands, although they are again B2B, it’s not a B2C thing that we do. So, everything is B2B. But going forward, this is something that is more of an aspiration that I would point out because we’ve been into lighting for so many years now. And we’ve always saw this, this gap in the market where customers really want something in that category where they are very limited options. So, this is something that was intended. So, it’s going to be a slow journey. But then again, like I said, there are certain business or vertical where the revenue is not that high, but at the same time, the bottomline is good, the brand enjoys certain reputation. So, this is that category of business, I would say.

And how is solar inverter ramping up?

So, that is something again, which is very, very new. So, we recently completed one order, good volume and good value as well. So, now going forward, now that we have the product, we are constantly, there is a team working on a lot of new development is also happening in that category. And this is something that is pretty exciting because India is also now transitioning to newer, newer technologies when it comes to just putting the solar rooftop was something that is people don’t really talk of now. So, good projects they want with proper best system, which is battery and energy storage systems along with BMS, EMS. So, we are working in that direction developing certain new products. And that is something that is also happening along with. So, this is the non-lighting business

So, we were actually thinking of onboarding certain OEM customer for this, but then we realized that there is a lot of opportunity in some other key areas as well. For that, we are developing our strength. As of now, we already have gained the experience in this category. And going forward, the team is working on certain key areas, there was actually something that was in the pipeline, but that was for some other country, not for India, but then the war happened and that thing got delayed. So, but then that, we are shifting our strategy in this particular vertical and working on some other new key areas, where hopefully pretty soon we will have something to discuss with you guys.

Okay. If I look at the guidance today, let’s say 10% in home lighting and other business growing at 40% odd, that leads to console revenue of roughly 30% growth for this year at least. So, would you like to officially up your guidance for this year? Or you guys still want to stick with 20%- 22% guidance last quarter?

So, I would stick to the guidance that we had given during quarter 4, which was close to around 18%-20% of growth in the revenue. That is because looking at the volatility in the market and the geopolitical issues. So, every day there is a new surprise, something new happening. So, that is why we would and probably maybe by quarter, end of Quarter 2 or around Quarter 3, if need be, we will definitely update if there will be a need to do that.

Last thing, what is the CAPEX spending for this year and what depreciation should we work for the full year?

So, CAPEX spending is, I think, somewhere close to around Rs. 20-25 crores, not much of the CAPEX is left. And depreciation, for Tower-2, which has now partially been commercialized in Quarter 2. So, there are multiple floors in that Tower-2. So, we are currently utilizing, we started utilizing two of the floors for the hearable and wearable segment. So, the depreciation for that will start to probably kick in from Quarter 2 itself. So, that is why we’ve always shown the cash PAT figures for everyone to be aligned with what the company is doing as depreciation by the, maybe once revenues start to multiply and the depreciation rate will definitely then show a lower impact on the overall figures.

But after Tower-2, is there more CAPEX lined up? No.

So, the only CAPEX that is pending is around Rs. 20 crores, which is then going into tower three. So, Tower-2, more or less, the CAPEX has been done. It’s now only into the utilization phase. So, once, as and when we start utilizing the floors, that depreciation will start showing in the balance sheet or the figures. And then in Tower-2 also, the remaining floors, some slight CAPEX might come in the very near future once we set up, you know, the remaining lines or whatever in that sense. But that is not going to be something of high value to be discussed.

Thank you. Thank you all for making it to our quarterly earnings call for Q1 FY’27. If there are any further queries, please feel free to reach out to Stellar IR advisors. Thank you one and all. Have a nice day. Thank you so much.

Thank you. On behalf of IKIO Technologies Limited, that concludes this conference. Thank you for joining us and you may now disconnect your lines.