Thaai Casting Ltd Q3 FY26 Earnings Analysis

- FY26 revenue growth expected around 20% over previous year (~INR150 crores), despite some project postponements. - Certain large order delayed from January to July, pushing volume ramp-up to H2 and FY27. - FY27 outlook positive with continued order execution and planned capacity utilization improvements. - Gas nitriding facility revenues anticipated to increase from INR4.5 crores in H1 FY26 to INR6.5-7 crores in H2; total annual expected INR13 crores. - New planetary gear machines expected to generate around INR25-40 crores annual revenue starting FY27. - Order book (~INR500 crores) fully automotive, with execution timelines extending 36-80 months. - Company aims to expand customer base, focus on specialized, higher-margin products and maintain steady profitable growth. - New projects and capacity expansions under discussion for future years beyond FY27.

- Revenue growth of ~20% expected for FY26 despite customer-side delays, targeting around INR150-170 crores (Pages 14, 15, 16). - FY27 outlook indicates better growth with new orders and ramp-up in postponed projects (Pages 10, 16). - Margins steady at ~26%, expected to slightly improve with specialized processes like gas nitriding and planetary gear machines, though increasing casting volume may dilute overall margin (Page 10). - Gas nitriding segment revenue forecasted at INR13 crores annually post full ramp-up, with EBITDA margin around 14% (Page 7). - Planetary gear machines expected to generate close to INR40 crores annually with commercialization targeted by FY27, contributing positively to margins (Page 8). - Debt levels capped at INR116 crores with interest rates around 7.95%-8.2%; no major capex planned in FY27, focus on optimizing current assets (Page 16, 9). - Strategic focus on expanding customer base and specialized, higher-margin product lines for sustainable profitable growth (Page 5).

- No major capex planned for FY27; focus will be on utilizing the investments made so far, especially in gas nitriding and planetary gear machines. - Small, ongoing investments in machining may occur to support existing customers, but no big casting-related capex is expected next year due to space and cost constraints. - Discussions for future capex expected to start next year, influenced by inquiries and potential participation in upcoming wind exhibitions. - Possible expansion plans beyond FY27, involving new machines for induction hardening and other specialized processes; these may require additional investments in subsequent years. - Current borrowings of INR116 crores are expected to be the maximum for the ongoing projects, with no immediate plans to raise further debt for capex.

- No new fundraising through debt or equity is planned for FY27; the company expects no significant capex next year and will focus on optimizing existing investments. - Current borrowing stands at INR116 crores, which is considered the maximum needed for the ongoing project; no increase in borrowings is anticipated. - Future capex discussions and potential fundraising may commence after FY27, pending assessment of expansion needs identified through industry events, such as the recent wind exhibition. - The company recently completed a preferential allotment raising approximately INR31.49 crores through equity shares, convertible warrants, and CCDs, providing financial flexibility for current capacity expansion and operations. - Overall, the company is cautious about additional debt and equity raising until existing projects are fully capitalized and operational.

- Current order book stands around INR 500 crores, entirely in the automotive segment. - Execution timeline for the order book varies from 36 months to 80 months. - A cumulative order value of INR 91 crores covers execution over 60 months. - Some portion of orders expected for FY26 got postponed to next year, causing delay in H1 revenue translation. - Postponement mainly due to customer-side delays and validation/audit processes; one major order for Brazil postponed from January to July next year. - Management expects revenue growth of 20% for FY26 despite postponements. - New orders expected from existing automotive customers, with some new platform orders potentially confirmed by December. - Orders received include INR 126 crores domestic order (steering wheels) and INR 12.43 crores for construction hardware, executable in 36-48 months.