1. LED display maker + Hearing Aids + Mobile Phones
oseldevices.com | NSE: OSELDEVICE
So, hearing aid is our favorite in terms of profitability, and mobile phone will become favorite in terms of top line. And LED basically will give us the reach that we need in the corporates and other places.
We are licensed to manufacture mobile phones from Philips. And we are doing the end-to-end business of this from manufacture to final retail sales.
2. FY24–26: PAT CAGR 52% & Revenue CAGR 49%
3. FY26: PAT up 46% & Revenue up 57% YoY
4. H2 FY26: PAT up 75% & Revenue up 67% YoY
PAT up 17% & Revenue up 47% HoH
5. Business Metrics: Strong Return Ratios
Strong return ratios — muted as capital increased post IPO
6. Outlook: 50%+ Revenue Growth for FY27
6.1 Management Guidance — OSEL Devices
FY27 guidance. So, as we mentioned basically, we will continue a similar set of growth that we have achieved this year. So, and in fact in both the terms, in terms of EBITDA, in terms of top line, we will be bettering what we have done this year.
We are looking forward to our JNPA SEZ hub with commercialization expected from April 2027. This will significantly expand our exports and OEM capacity from India's business port, with SEZ tax benefit combined with our US FDA registration unlocking the US hearing aid market. We believe the next phase of growth will be both large in scale and higher in quality of hearing.
And in terms of EBITDA margins, we are expecting it to be similar or even better because we are also entering into retail of with SFL acquisition. We are also getting into the retail acquisition -- retail business of hearing aids, which is high-margin business. So, we are expecting both growth and EBITDA margins to get better from here, at least for next four-five years.
H1 FY26:
“The new initiatives are gaining traction, but let us still guide to ~20–25% overall growth.”
H2 FY26:
“FY26 delivered ~57% revenue growth; we believe we can maintain or even improve that growth rate, while margins can also improve.”
OSEL Devices upgraded guidance from a modest 20–25% growth expectation in November 2025 to suggesting ~57%+ growth could continue in FY27, while simultaneously expecting EBITDA margins to remain similar or improve.
7. Valuation Analysis
7.1 Valuation Snapshot — OSEL Devices
Current Market Price= ₹370; Market Cap = ₹655.82 Cr
OSEL Devices has guided for FY27 growth similar to the 57% growth in FY26
We have assumed 50% growth in FY27 with stable margins
Looks reasonably valued at current prices
Attractive forward valuations with FY27 P/E (×) of 15 and EV/EBITDA (×) of 9 for a company delivering 50% growth
7.2 Opportunity at Current Valuation
On FY26 numbers, the valuation is reasonable not cheap.
The opportunity depends on how much of FY26’s growth can sustain in FY27
Management has indicated that FY27 revenue and EBITDA growth could remain at similar levels or improve, supported by:
Scaling of Philips mobile phones
Start of smartphone shipments
Consolidation of SFL’s hearing-aid retail business
Continued growth in LED displays
Higher exports
This looks attractive if OSEL can continue growing above 35–40%, because several growth drivers have already moved from plans into execution:
Philips mobile volumes have scaled beyond pilot orders
Smartphones have been launched
SFL brings an existing hearing-aid retail business into FY27
Exports have already crossed ₹23 crore
The earnings mix could also improve:
Mobile phones are expected to drive top-line growth
Hearing aids remain the higher-margin business
SFL’s clinic-led retail model could improve hearing-aid realizations and profitability
Possibility of two sources of upside:
Earnings growth
Valuation re-rating, if growth remains strong and execution improves
The key investment case at ₹370 is that the market may be underpricing FY27 earnings growth.
If OSEL delivers 40%+ revenue growth while maintaining ~18% EBITDA margins, the current valuation could prove attractive even without assuming any expansion in the valuation multiple.
7.3 Risk at Current Valuation
OSEL trades at roughly 22.5× FY26 earnings. This valuation is not demanding if FY27 growth remains strong, but it leaves less room for disappointment if execution falls materially below management’s expectations.
FY27 guidance is now very aggressive. After FY26 revenue growth of 56.9%, management indicated that a similar growth rate could be maintained or even improved, while EBITDA margins could remain similar or improve. If growth moderates to 20–25% instead, the current valuation would look much less attractive.
Cash-flow conversion remains weak. FY26 operating cash flow was negative despite strong reported profitability, reflecting a large working-capital build. This makes the quality of earnings an important monitorable.
Working-capital intensity is rising. The business is carrying significant receivables, inventory and short-term borrowings as it scales. Faster growth could therefore require additional funding rather than automatically translating into free cash flow.
This creates a risk that EBITDA growth may not translate proportionately into PAT growth if debt and interest costs continue rising.
The growing Philips mobile business introduces mix risk. Mobile phones can drive revenue rapidly, but hearing aids remain the structurally higher-margin business. If mobile becomes a much larger share of sales without a corresponding increase in higher-margin hearing-aid retail, consolidated profitability could come under pressure.
Don’t like what you are reading? Will do better. Let us know at hi@moneymuscle.in
Don’t miss reading our Disclaimer