Maiden Forgings

- As of the call, Maiden Forgings Limited has expanded its client base from 250 to approximately 450 customers, indicating strong order inflow. - The company receives around 10 to 15 new inquiries daily, with an average addition of 2 to 3 new customers per week. - They report approximately 7 to 8 new customers added monthly on average. - Orders are mostly managed back-to-back, ensuring inventory purchase is closely aligned with confirmed orders, minimizing exposure to price fluctuations. - Inventory levels are maintained at around 35 to 40 days to ensure smooth supply and order fulfillment. - Growth outlook remains robust with a sustainable annual growth rate of 20%-25%, supporting an increasing order book aligned with capacity expansions.

- No new long-term borrowing planned; investments, including recent plant capex, were entirely funded through internal accruals. - Short-term borrowing increased temporarily (INR42 crores to INR50 crores) mainly to support higher inventory due to the new nail plant setup, expected to reduce soon. - IPO proceeds will be used specifically for capex and working capital growth, not for debt repayment. - Debt reduction will largely come from excess cash flow and internal accruals rather than equity. - The company aims to avoid using expensive equity funds to pay off lower-cost debt as current borrowing costs (~9%) are lower than typical equity costs. - Facility consolidation and asset sales (land) are expected to generate cash to further reduce debt.

- Maiden Forgings is planning capital expenditure of around 8% to 9% of revenue for FY 2024. - Capex primarily focused on enhancing pneumatic nails production capacity—doubling from 250 tons to 500 tons per month. - An investment of approximately INR 4 crores planned for the nail plant expansion. - New projects include the ongoing installation of oil tempered wire capacity, expected to complete in the last six months of FY 2024. - Consolidation of two existing plants into one at a new, cheaper land site is underway, with due diligence for land acquisition in progress. - The plan includes selling existing land assets post-shift, potentially generating INR 15-20 crores cash inflow to reduce debt and fund growth. - IPO proceeds will be used specifically for capex and working capital growth, avoiding paying off cheaper debt with expensive equity.

- Targeting a 20% annual growth in top line (revenue) for FY 2024, sustained over the next 2-3 years. - Growth driven by transition to higher value-added products such as stainless steel, specialty steel, collated pneumatic nails, and oil tempered wire. - Pneumatic nails business expected to contribute significantly, targeting 90% utilization leading to around 20% growth. - Export contribution expected to increase from 7-8% in FY 2023 to around 20-22% in FY 2024, focusing on US, Europe, Australia, and Africa markets. - Capacity utilization currently at 65-70%, with potential to increase production volume by 1.3-1.4 times within existing capacity. - Overall margin improvement targeted from current 10% EBITDA to 12-13% over 2-3 years. - Expansion investments ongoing to support capacity growth, including doubling collated nails production.

- Maiden Forgings targets a sustained annual revenue growth of 20%-25% over the next 2-3 years (Page 8). - Operating margins (EBITDA) expected to improve from around 10% to 12%-13% within 2-3 years driven by shift to higher-value products like stainless steel, specialty steel, collated/pneumatic nails, and wire mesh (Page 8). - Focus on value-added products and transition from B2B to B2C markets expected to enhance profitability and margins (Pages 7, 8). - FY23 EBITDA margin doubled to 10.09%, with net profit margin at 4.34%, showing strong recent profitability improvement (Page 4). - Earnings anticipated to grow exponentially with margin improvements coupled with top-line growth (Page 8). - Capital expenditures funded largely from internal accruals to support expansion without increasing debt, underpinning financial discipline (Page 17). Overall, Maiden Forgings is optimistic on robust growth in earnings and margins going forward.