Vivid Electromech Stock: Can 50% Data Centre Revenue and 3x Capacity Expansion Drive FY27 Growth? 

Synopsis: Vivid Electromech is strengthening its position in data centres through capacity expansion, deeper hyperscaler relationships, and a growing order pipeline, while maintaining strong profitability and a largely debt-free balance sheet. 

The shares of this small cap company majorly engaged in manufacturing of of Low-Voltage and Medium-Voltage electrical panels and automation systems were in focus after its data centre business and capacity expansion are expected to drive its next phase of growth 

With the market capitalization of Rs. 1230 Crores, the shares of Vivid Electromech Ltd closed at around Rs. 1384 per share which is 3 percent discount from its 52 week high of Rs. 1429 per share and is trading at a P/E of 38.7 whereas industry P/E stands at 31.5

Company Transformation and Business Focus

Vivid Electromech, incorporated in 1990, has undergone a significant strategic transformation over the last five years. The company moved away from EPC, commercial and residential businesses because of margin pressure and shifted its focus entirely toward manufacturing. 

Today, it operates as an ISO certified manufacturer of low-voltage and medium-voltage electrical panels and automation systems. The company serves sectors such as data centres, metro and rail infrastructure, industrial manufacturing, and renewable energy. Unlike standard panel manufacturers, Vivid designs and manufactures products according to customer-specific requirements, helping it cater to complex industrial projects.

Its product portfolio covers medium-voltage solutions ranging from 3.3 kV to 33 kV, including VCB panels, RMU panels, DG synchronising panels, CRP panels, MV APFC panels and vacuum contactor panels. In low-voltage solutions up to 1,000 volts, it offers PCC panels, MCC panels, intelligent MCC panels, VFD panels, APFC panels, soft starter panels, PDU panels and automation systems. PDU panels were introduced around a year ago and are emerging as an important growth area.

Revenue Mix Shows Strong Data Centre Exposure

The data centre segment has become the company’s largest revenue contributor, accounting for 49.95 percent  of FY26 revenue, equivalent to Rs. 99.94 crore. Industrial manufacturing and machinery contributed 21.30 percent , while infrastructure, construction and real estate, including metro projects, contributed 19.89 percent . Solar and renewable energy accounted for 8.53 percent , while the remaining 0.33 percent  came from other segments.

Management highlighted that approximately 70 percent  of data centre revenue comes from hyperscale customers. The company currently works with 6 of the top 10 hyperscalers in India and is targeting the addition of the remaining four within the next 3 to 6 months. Average data centre project sizes range between Rs. 20 crore and Rs. 25 crore, while demand visibility in the sector extends for 4 to 5 years.

Strong OEM Partnerships Strengthen Market Position

Vivid has established partnerships with several global electrical equipment companies. It is licensed by ABB India to manufacture ArTu K low-voltage switchboards and operates as an ABB medium-voltage switchboard system integrator under the Silver Category. The company has also received ABB’s Business Excellence Award for three consecutive years.

Its association with Hitachi covers medium-voltage VFD drives across Mumbai and Maharashtra. Through its recently acquired 99 percent  subsidiary, Mechtech Infrasolutions, purchased for Rs. 99 lakh, the company has become an authorised Siemens SIEPAN 8PU licensed partner. It also maintains a strategic partnership with Lauritz Knudsen, formerly L&T Electrical & Automation.

Financial Performance Reflects Rapid Growth

The company has delivered strong growth over the last four years. Revenue from operations increased from Rs. 59.31 crore in FY23 to Rs. 88.91 crore in FY24, Rs. 155.32 crore in FY25 and Rs. 200.14 crore in FY26, reflecting a CAGR of 49.99 percent .

EBITDA grew from Rs. 2.52 crore in FY23 to Rs. 46.15 crore in FY26. EBITDA margin improved significantly from 4.21 percent  to 22.95 percent  during the same period. Net profit rose from just Rs. 0.14 crore in FY23 to Rs. 31.61 crore in FY26, translating into a CAGR of 512.10 percent . Net profit margin expanded from 0.23 percent  to 15.72 percent , while earnings per share reached Rs. 45.13 in FY26.

The company reported ROE of around 53 percent  and ROCE of approximately 48 percent , highlighting strong capital efficiency. Despite growth, it remains nearly debt-free, with working capital facilities of only Rs. 5 crore from Kotak and Rs. 2 crore from ICICI Bank.

Capacity Expansion to Support Future Demand

To support future growth, Vivid is developing a new manufacturing facility at Ambernath in Maharashtra. The facility spans around 1,19,800 square feet on approximately 7,978 square metres of land. Phase 1 commercial operations are expected by the end of August 2026, while full commissioning is targeted for October 2026.

The expansion will add annual capacity of 14,300 low-voltage verticals and 700 medium-voltage verticals. Total manufacturing capacity will rise from about 7,500 verticals annually to around 22,500 verticals, representing a threefold increase. Management clarified that the expansion is intended to handle larger order volumes and future demand rather than address immediate capacity constraints.

Order Book and Growth Outlook

Vivid currently has an executable order book of Rs. 221 crore. The company typically executes orders within 2 to 9 months and expects to maintain a revenue growth trajectory of 35 percent  to 40 percent . Management has set a revenue target of more than Rs. 300 crore for FY2.

The customer base stands at 113 customers, with average revenue per customer of Rs. 1.77 crore during FY26. Around 75 percent  of revenue comes from repeat customers undertaking new projects, while 25 percent  is generated from new client additions. This demonstrates both customer retention and business expansion capabilities.

Vivid Electromech appears well positioned to benefit from rising demand across data centres, infrastructure and industrial sectors. Its focus on specialised manufacturing, strong customer relationships, established global partnerships and ongoing capacity expansion provide a solid foundation for future growth.

Improving profitability and a healthy balance sheet further strengthen its position. However, successful execution of expansion plans, workforce scaling and market diversification will remain important factors in sustaining its growth momentum over the coming years.

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