Macpower CNC Machines Ltd

- The company plans a Phase 1 CapEx of INR 100 crore, expected around July-August, following land allotment. - Fundraising options include: - Strategic partnership with JV partners, potentially involving equity stake. - Utilizing reserve funds (20%-25% available). - Raising short-term debt for about 50% of the required amount. - The specific fundraising mix will be decided after land receipt and consultations with advisors (like Vinayji from Kaptify). - The company has multiple options and does not foresee funding as a major constraint for the new plant. - Discussions with JV partners are ongoing, with a key meeting planned in September to finalize joint venture decisions.

- The company plans a new plant with a phased capital expenditure (CapEx): - Phase 1 CapEx: INR 100 crore, expected around July-August after land allotment. - Phase 2 CapEx: Another INR 100 crore, depending on market demand. - Land allotment process is ongoing with about 65%-70% formalities completed; land expected by July. - Phase 1 capacity build, including foundry and backward integration, targeted to complete within 10-14 months post land possession. - Revenue contribution from Phase 1 is expected from H2 FY27, with gradual capacity utilization starting after plant commissioning. - Funding options for CapEx include strategic partnership with JV partners, internal reserves (20-25%), and possible debt; no constraints expected on funding. - The company is discussing joint ventures with European companies to expand product basket and global distribution. - Capacity will increase by 2,000-2,500 machines with the new plant, shifting entire production in five years.

- The company expects quarter-on-quarter order execution to increase by 25%, projecting new orders worth INR360-375 crores if INR350 crores are completed currently. - Orders will be diversified across more than 300 segments, primarily automobile, aerospace, defence, die and moulds, and agriculture, with no single segment or city exceeding 10-15% of the basket to reduce risk. - The order book and bidding are robust, with a strong focus on defence and aerospace segments, targeting significant growth in these sectors. - Capacity utilization is expected to exceed 80% in the current financial year, with production capacity rising to 2,500 machines post-July expansion. - The company anticipates a smooth growth trajectory of 10-12% in the near term, with potential higher growth driven by increasing market share, enhanced product basket, and expanded distribution network. - New investments and expansions like Phase 1 CapEx are expected to contribute revenue starting FY27 gradually.

- The company expects quarter-on-quarter order execution growth of around 25%, indicating consistent revenue growth ahead. - Management anticipates significant growth in revenue across all quarters in the current financial year. - Increased execution in defense and NEXA segments is expected to improve profit margins. - CapEx expansion (Phase 1) expected to be completed within 12 months after land acquisition, with revenues starting from FY27 and gradually increasing thereafter. - Revenue growth is projected at 10-12% smoothly in the near term, with potential challenges beyond that. - Last year saw 9% YoY revenue growth and 10.4% PAT growth; the company aims for similar or better growth going forward. - Top-line improvements due to fixed cost leverage will likely enhance EBITDA and PAT margins further. - Management is committed to delivering significant and sustained quarterly growth, supported by diversified segments and expanding order book.

- As of 31st March 2025, the pending order book is INR 331 crore with advance payments and 168 main machines. - NEXA segment contributes 28% of pending orders, the highest ever. - Defence sector has an opening order book of INR 23 crore, also the highest ever. - The company has submitted bids worth INR 1,076 crore (INR 570 crore domestic and INR 505 crore defence sector), the highest ever. - Quarter-on-quarter execution targets a 25% increase; if INR 350 crore worth of machines were completed, new orders expected are INR 360-375 crore. - The company diversifies across 300 segments; top 10-15% comes from any one segment to reduce risk. - Order inflow average in defence sector is around 10% strike rate from tender submissions. - No significant order cancellations, with strong advance payment policy in place.