SHANTIGEAR - Shanthi Gears
📢 Recent Corporate Announcements
Shanthi Gears Limited has submitted formal applications to BSE and NSE for the reclassification of Algavista Greentech Private Limited from the 'Promoter Group' to the 'Public' category. This regulatory step follows the board's approval granted on January 22, 2026. The outgoing entity, Algavista Greentech, currently holds zero shares (0.00%) in the company. This move is a procedural cleanup of the promoter group structure under SEBI (LODR) Regulations.
- Application for reclassification submitted to stock exchanges on January 23, 2026
- Algavista Greentech Private Limited holds 0 shares (0.00% stake) in Shanthi Gears
- The reclassification follows prior board approval and initial requests made in December 2025
- No change in the actual control or shareholding structure of the company
Shanthi Gears reported a challenging Q3 FY26 with revenue declining 26% YoY to ₹116.82 Crores and Profit Before Tax dropping 39% to ₹21.59 Crores. Despite the earnings contraction, the company achieved its highest-ever quarterly order booking of ₹169 Crores, indicating a strong future pipeline. The Board declared an interim dividend of ₹3 per share (300%) with a record date of January 29, 2026. Concurrently, CFO Ranjan Kumar Pati has resigned to pursue external opportunities, effective March 19, 2026.
- Revenue decreased to ₹116.82 Crores in Q3 FY26 from ₹157.51 Crores in Q3 FY25
- Profit Before Tax (PBT) fell to ₹21.59 Crores compared to ₹35.43 Crores in the previous year
- Achieved record quarterly order booking of ₹169 Crores, representing 28% YoY growth
- Declared interim dividend of ₹3 per share; unexecuted order book stands at ₹305 Crores
- CFO Ranjan Kumar Pati to step down effective March 19, 2026
Shanthi Gears reported a weak Q3 FY26 with revenue falling to ₹116.82 Crores from ₹157.51 Crores YoY, primarily due to lower order bookings in previous quarters. Profit Before Tax also declined significantly to ₹21.59 Crores from ₹35.43 Crores. However, the company achieved its highest-ever quarterly order booking of ₹169 Crores (up 28% YoY), bringing the total unexecuted order book to ₹305 Crores. The Board declared an interim dividend of ₹3 per share and announced the resignation of CFO Ranjan Kumar Pati.
- Revenue declined 26% YoY to ₹116.82 Crores in Q3 FY26.
- Profit Before Tax dropped to ₹21.59 Crores from ₹35.43 Crores in Q3 FY25.
- Achieved record order booking of ₹169 Crores in Q3, with an unexecuted order book of ₹305 Crores.
- Declared an interim dividend of ₹3 per equity share (300%) with a record date of January 29, 2026.
- CFO Ranjan Kumar Pati resigned effective March 19, 2026, to pursue outside opportunities.
Shanthi Gears has declared an interim dividend of ₹3 per share (300%) for FY 2025-26, with a record date of January 29, 2026. The company reported a 26% YoY decline in Q3 revenue to ₹116.82 crore and a drop in PBT to ₹21.59 crore, primarily due to lower order bookings in previous quarters. However, the company achieved its highest-ever quarterly order booking of ₹169 crore, bringing the total order book to ₹305 crore. Additionally, CFO Ranjan Kumar Pati has resigned to pursue outside opportunities, effective March 19, 2026.
- Interim dividend of ₹3 per equity share declared with record date of January 29, 2026
- Revenue for Q3 FY26 fell to ₹116.82 crore from ₹157.51 crore in the previous year
- Achieved highest-ever quarterly order booking of ₹169 crore, up 28% YoY
- Unexecuted order book stands at a healthy ₹305 crore as of December 31, 2025
- CFO Ranjan Kumar Pati to step down effective March 19, 2026
Shanthi Gears Limited's Board has approved a request from Algavista Greentech Private Limited to be re-classified from the 'Promoter Group' to the 'Public' category. The outgoing entity currently holds zero shares, representing 0.00% of the company's total equity. This move follows an initial request made on December 18, 2025, and adheres to SEBI Listing Regulations. The re-classification will be finalized once no-objection certificates are received from the NSE and BSE.
- Board approved the re-classification of Algavista Greentech Private Limited from Promoter Group to Public.
- The outgoing promoter group member holds 0 equity shares, representing 0.00% of the total paid-up capital.
- The decision was finalized during the Board of Directors meeting held on January 22, 2026.
- The process is subject to final regulatory approval and no-objection from the NSE and BSE.
Shanthi Gears reported a challenging Q3 FY26 with revenue declining 26% YoY to ₹116.82 Crores and Profit Before Tax dropping to ₹21.59 Crores due to lower execution of previous orders. Despite the weak quarterly performance, the company achieved its highest-ever quarterly order booking of ₹169 Crores, representing 28% YoY growth. The Board declared an interim dividend of ₹3 per share (300%) with a record date of January 29, 2026. Additionally, the company announced the resignation of CFO Ranjan Kumar Pati, effective March 19, 2026.
- Revenue for Q3 FY26 stood at ₹116.82 Crores versus ₹157.51 Crores in Q3 FY25.
- Profit Before Tax (PBT) declined to ₹21.59 Crores from ₹35.43 Crores in the same period last year.
- Achieved record quarterly order booking of ₹169 Crores with a total unexecuted order book of ₹305 Crores.
- Declared an interim dividend of ₹3 per equity share for the financial year 2025-26.
- CFO Ranjan Kumar Pati to step down on March 19, 2026, to pursue outside opportunities.
Shanthi Gears Limited has notified the stock exchanges regarding a change in the legal structure and name of its Statutory Auditors. The existing firm, M/s. M S K A & Associates, has converted from a partnership firm into a Limited Liability Partnership (LLP) under the LLP Act, 2008. Consequently, the auditor's name has changed to M/s. M S K A & Associates LLP effective January 13, 2026. This is a routine administrative update and does not represent a change in the auditing entity itself.
- Statutory Auditor M/s. M S K A & Associates converted to a Limited Liability Partnership (LLP)
- The firm is now officially known as M/s. M S K A & Associates LLP, Chartered Accountants
- The change in legal status became effective as of January 13, 2026
- Company received formal intimation from the auditors on January 16, 2026
Shanthi Gears Limited has submitted its quarterly compliance certificate under Regulation 74(5) of SEBI (Depositories and Participants) Regulations, 2018. The certificate, issued by MUFG Intime India Private Limited, confirms that all dematerialization requests for the quarter ended December 31, 2025, were processed within prescribed timelines. This filing confirms that physical certificates were mutilated, cancelled, and the names of depositories were updated in the register of members. This is a standard administrative procedure and does not impact the company's financial standing.
- Compliance certificate issued for the quarter from October 1, 2025, to December 31, 2025.
- Registrar MUFG Intime India Private Limited confirmed processing of all dematerialization requests.
- Securities comprised in the certificates are listed on the stock exchanges where earlier securities were listed.
- Physical security certificates were mutilated and cancelled after due verification by the depository participant.
Shanthi Gears Limited has announced the closure of its trading window for all designated persons and their relatives starting January 1, 2026. This mandatory regulatory step is taken ahead of the board meeting to approve the unaudited standalone financial results for the quarter and nine months ending December 31, 2025. The window will remain closed until 48 hours after the financial results are officially declared to the stock exchanges. The specific date for the board meeting will be communicated separately in the future.
- Trading window closure commences on January 1, 2026, for the Q3 FY2025-26 reporting period.
- Restriction applies to Directors, designated persons, and their immediate relatives under SEBI Insider Trading Regulations.
- The closure will extend until 48 hours after the declaration of the Unaudited Standalone Financial Results.
- The board meeting date for result approval is yet to be finalized and announced.
Shanthi Gears Limited has received a formal request from Algavista Greentech Private Limited to be reclassified from the 'promoter and promoter group' category to the 'public' category. The outgoing promoter, Algavista Greentech, currently holds zero shares (0.00%) in the company. This move is a procedural formality under Regulation 31A of SEBI Listing Regulations. Since the entity has no equity stake, the reclassification will not impact the company's shareholding structure or management control.
- Request for reclassification received from Algavista Greentech Private Limited on December 18, 2025.
- The outgoing promoter currently holds 0 paid-up equity shares in the company.
- The reclassification is sought under Regulation 31A of SEBI (LODR) Regulations, 2015.
- Cumulative holding of the outgoing promoter group stands at 0.00% of the total share capital.
Shanthi Gears has received approval from both the National Stock Exchange of India Limited (NSE) and BSE Limited for the reclassification of M/s. Coromandel Engineering Company Limited (CECL) and M/s. Yanmar Coromandel Agrisolutions Private Limited (YCAS) as outgoing members of the Promoter Group. The approvals were granted via letters NSE/LIST/COMP/SHANTIGEAR/529/2025-2026 and LIST/COMP/KR/569/2025-26, both dated December 01, 2025. This reclassification is in accordance with Regulation 31A of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. Investors should note this change in the promoter group composition.
- NSE approval letter no. NSE/LIST/COMP/SHANTIGEAR/529/2025-2026 dated 01 December, 2025
- BSE approval letter no. LIST/COMP/KR/569/2025-26 dated 01 December, 2025
- Reclassification of M/s. Coromandel Engineering Company Limited (CECL)
- Reclassification of M/s. Yanmar Coromandel Agrisolutions Private Limited (YCAS)
Financial Performance
Revenue Growth by Segment
The company reported a total operating income of INR 604.6 Cr in FY2025, representing a growth of 12.8% YoY. The replacement segment is a major driver, contributing 55.3% of total revenue in FY2025. No single end-user segment (Steel, Cement, Power, etc.) contributes more than 30% to the total revenue, providing a diversified buffer against sector-specific downturns.
Geographic Revenue Split
Not disclosed in available documents; however, the company maintains a dominant presence as a leading manufacturer of industrial gears in the Indian domestic market.
Profitability Margins
Operating margins have shown a consistent upward trend, expanding from 14.3% in FY2020 to 19.1% in FY2024, and reaching 21.4% in FY2025. This expansion is driven by a favorable product mix and better absorption of fixed costs as the revenue scale increases.
EBITDA Margin
EBITDA margin stood at 21.4% for FY2025, up from 19.1% in FY2024. In Q1 FY2026, the margin further improved to 22.6% compared to 20.6% in Q1 FY2025, reflecting strong core profitability and effective cost optimization measures.
Capital Expenditure
Capital expenditure for FY2025 was INR 24.35 Cr, an increase of 21.75% from the INR 20.00 Cr spent in FY2024. These investments are focused on property, plant, and equipment to support moderate capacity enhancements and are entirely funded through internal accruals.
Credit Rating & Borrowing
The company holds a long-term rating of [ICRA]AA (Stable) and a short-term rating of [ICRA]A1+. Borrowing costs are effectively 0% as the company has remained debt-free for the last 10 years, with nil utilization of fund-based working capital limits.
Operational Drivers
Raw Materials
Key raw materials include steel, castings, and forgings. While specific percentage breakdowns per material are not provided, raw material costs are a significant component of the total expenditure, and margins are sensitive to price volatility in these commodities.
Capacity Expansion
Current installed capacity is not specified in units; however, the company is executing a moderate capex plan (INR 24.35 Cr in FY25) to scale operations. Management expects better cost absorption as these revenues scale up.
Raw Material Costs
Raw material costs are subject to market volatility; the company mitigates this through periodic cost optimization and a high-value-addition product strategy. In historical periods (FY16), material consumption was approximately 38% of total income.
Manufacturing Efficiency
Operating margins improved to 22.6% in Q1 FY2026, indicating high manufacturing efficiency and the ability to maintain profitability even when revenue growth is flat (INR 134.9 Cr in Q1 FY26 vs INR 138.8 Cr in Q1 FY25).
Strategic Growth
Expected Growth Rate
12.80%
Growth Strategy
Growth is targeted through deepening penetration in the replacement segment (currently 55.3% of revenue), which offers higher margins. The company leverages its 50-year brand legacy and the operational/financial ecosystem of the Murugappa Group to secure large-scale orders in diversified sectors like Railways and Steel.
Products & Services
Industrial gears, customized gearboxes, gear motors, and replacement gear components.
Brand Portfolio
Shanthi Gears.
Market Expansion
The company is focusing on scaling its operations and earnings to trigger a potential credit rating upgrade, targeting diversified end-user segments to insulate against sector-specific cyclicality.
Market Share & Ranking
Identified as a leading manufacturer of industrial gears in India; specific percentage market share not disclosed.
Strategic Alliances
Subsidiary of Tube Investments of India Limited (TIIL) and part of the Murugappa Group, providing implicit operational and financial support.
External Factors
Industry Trends
The industrial gear industry is currently benefiting from a recovery in the capex cycles of end-user industries. There is an evolving trend toward high-precision, customized gear solutions where Shanthi Gears is positioned as a premium provider.
Competitive Landscape
Operates in a competitive market with both organized and unorganized players, but maintains an edge through high value-addition and a reputed clientele in the public and private sectors.
Competitive Moat
The moat is sustained by a 50-year established presence, deep technical expertise in customized gear design, and the strong financial backing of the Murugappa Group. The high contribution from the replacement segment (55.3%) creates a sticky customer base with high switching costs.
Macro Economic Sensitivity
Highly sensitive to industrial GDP and the domestic capex cycle. A contraction in industrial output typically leads to a reduction in demand for heavy-duty industrial gearboxes.
Consumer Behavior
Industrial customers are increasingly prioritizing long-term reliability and replacement availability, favoring established brands like Shanthi Gears over lower-cost, unorganized competitors.
Geopolitical Risks
Exposure is primarily domestic; however, global commodity price shifts (steel) impact input costs.
Regulatory & Governance
Industry Regulations
Operations are governed by the Companies Act, 2013 and Indian Accounting Standards (Ind AS). The company must comply with industrial safety and environmental norms applicable to heavy engineering units.
Environmental Compliance
The company is exposed to tightening environmental regulations, which may necessitate future investments in cleaner manufacturing processes to avoid penalties or operational disruptions.
Taxation Policy Impact
The effective tax rate is approximately 25.4%, based on a PBT of INR 130.09 Cr and tax paid of INR 33.06 Cr in FY2025.
Legal Contingencies
The company has disclosed the impact of pending litigations in Note 29a of its financial statements. While the specific INR value is not detailed in the summary, auditors have confirmed these are disclosed in accordance with statutory requirements.
Risk Analysis
Key Uncertainties
The primary uncertainty is the volatility of raw material prices and the cyclical nature of the heavy engineering industry, which could impact revenue stability by 10-15% during macro-economic slowdowns.
Geographic Concentration Risk
Primarily concentrated in the Indian market, making it susceptible to domestic economic policy shifts.
Technology Obsolescence Risk
Moderate risk; the company mitigates this by focusing on high-value-added customized products that are difficult to commoditize.
Credit & Counterparty Risk
Low risk; the company deals with a reputed and diversified clientele, and its strong liquidity (INR 173.6 Cr in investments) provides a significant buffer.