Any current/future new fundraising through debt or equity?

No significant new CAPEX planned for FY20, indicating limited immediate need for fresh fundraising (Page 13, 14). The company currently relies on working capital limits from banks (SBI and HDFC) with utilization expected between Rs. 150 to Rs. 160 crores, showing a focus on optimizing existing credit facilities rather than raising fresh debt (Page 17). Finance cost likely at a maximum of Rs. 20 crores with turnover growing 15-20%, implying no plans for substantially increased borrowing (Page 17). Internal accruals expected to support growth, and any increase in interest cost is expected to be

Any current/future capex/capital investment/strategic investment?

No significant CAPEX was done in FY19; only maintenance CAPEX for cranes, machinery, and infrastructure improvements. No CAPEX planned for the current/future year as mentioned in multiple responses. The focus is on optimizing existing capacity rather than expanding through new capital investments. Strategic growth is expected through increasing revenue in telecom, railways, and EPC sectors rather than through new capital investments. The company is limiting expansion in EPC to manage working capital cycles rather than making large capital expenditures.

Future growth expectations in sales/revenue/volumes?

Salasar Techno Engineering Limited targets a minimum growth of 15% to 20% in revenue for FY20, potentially more depending on market conditions and government infrastructure focus. Telecom segment revenue expected between Rs. 400 to Rs. 450 crores, with slower growth (~10%) due to an already large base (~Rs. 400 crores). Railway segment expected to nearly double revenue from about Rs. 50 crores to Rs. 90-100 crores. EPC segment targeted at Rs. 140 to Rs. 150 crores, limited to 20-25% of total turnover to manage working capital cycles. New products like "cell-on-wheels" launched in telec

Future growth expectations in earnings/operating earnings/profits/EPS?

Salasar Techno Engineering Limited targets a revenue growth of 15% to 20% minimum for FY20, driven by telecom, railways, and EPC segments. EBITDA margins are expected around 11% year-on-year, with Q4 FY19 showing a high margin of 12.41% due to operational efficiencies. Profit after tax (PAT) rose by 12.3% in FY19 with Rs. 33.3 crores and Q4 FY19 PAT was Rs. 10.2 crores. EPS for Q4 FY19 was Rs. 7.66. Finance costs peaked at Rs. 5 crores per quarter and may reduce with internal accruals despite revenue growth. Telecom segment growth is expected to moderate to 10%-20% due to higher base, while ra

Current/ Expected Orderbook/ Pending Orders?

Current EPC order book under execution: Rs. 250 crores. L1 confirmed EPC orders likely to be confirmed in next 2-3 weeks: Rs. 110 crores. Manufacturing orders confirmed: Around Rs. 110 crores. Total confirmed order book excluding L1: Rs. 360 crores (EPC + manufacturing). Telecom segment order book: Rs. 110 crores. Railways and transmission manufacturing order book: Rs. 90 crores. Order execution for EPC projects expected to be completed over the next 18-20 months. Rs. 250 crores EPC orders include a significant portion from Reliance. New POs expected soon related to L1 status for Rs. 110 crore

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Salasar Techno Engineering LtdQ1 FY19Industrial Manufacturing

Salasar Techno Engineering Ltd Q1 FY19 Earnings Call Analysis

Revenue, margin, capex, fundraise and order book outlook from management commentary.

Price: ₹6.17P/E: 64.6Market Cap: ₹1.3K CrSector: Industrial Manufacturing

Management growth scorecard

Revenue

Category 3

Margin

Category 3

Fundraise

Order

Yes

Capex

1 of 5 growth signals are positive — mixed outlook.

Full analysis

Revenue guidance

Category 3

→Salasar Techno Engineering Limited targets a minimum growth of 15% to 20% in revenue for FY20, potentially more depending on market conditions and government infrastructure focus.
→Telecom segment revenue expected between Rs. 400 to Rs. 450 crores, with slower growth (~10%) due to an already large base (~Rs. 400 crores).
→Railway segment expected to nearly double revenue from about Rs. 50 crores to Rs. 90-100 crores.
→EPC segment targeted at Rs. 140 to Rs. 150 crores, limited to 20-25% of total turnover to manage working capital cycles.
→New products like "cell-on-wheels" launched in telecom could add Rs. 25-30 crores in revenue.
→Overall, growth driven by execution of existing orders plus new order inflows, especially from government infrastructure projects and 5G rollout opportunities.
→Operational efficiencies and better utilization expected to sustain or improve EBITDA margins around 11-12%.

Margin guidance

Category 3

→Salasar Techno Engineering Limited targets a revenue growth of 15% to 20% minimum for FY20, driven by telecom, railways, and EPC segments.
→EBITDA margins are expected around 11% year-on-year, with Q4 FY19 showing a high margin of 12.41% due to operational efficiencies.
→Profit after tax (PAT) rose by 12.3% in FY19 with Rs. 33.3 crores and Q4 FY19 PAT was Rs. 10.2 crores.
→EPS for Q4 FY19 was Rs. 7.66.
→Finance costs peaked at Rs. 5 crores per quarter and may reduce with internal accruals despite revenue growth.
→Telecom segment growth is expected to moderate to 10%-20% due to higher base, while railway and EPC (limited to 20-25% of revenue) are poised for faster growth.
→Company remains bullish on telecom and railway growth opportunities, with railways expected to almost double revenue from Rs. 50 crores in FY19.
→Management refrains from giving specific margin guidance quarter-wise but aims for consistent growth.

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Fundraise plans

→No significant new CAPEX planned for FY20, indicating limited immediate need for fresh fundraising (Page 13, 14).
→The company currently relies on working capital limits from banks (SBI and HDFC) with utilization expected between Rs. 150 to Rs. 160 crores, showing a focus on optimizing existing credit facilities rather than raising fresh debt (Page 17).
→Finance cost likely at a maximum of Rs. 20 crores with turnover growing 15-20%, implying no plans for substantially increased borrowing (Page 17).
→Internal accruals expected to support growth, and any increase in interest cost is expected to be moderate or potentially reduce (Page 10).
→No mention of fresh equity fundraising; prior IPO funds were utilized, but are currently not available (Page 10).
→Overall aim is to keep debt minimal and manage working capital efficiently without fresh fundraising plans shared in the call.

Order book

Yes

→Current EPC order book under execution: Rs. 250 crores.
→L1 confirmed EPC orders likely to be confirmed in next 2-3 weeks: Rs. 110 crores.
→Manufacturing orders confirmed: Around Rs. 110 crores.
→Total confirmed order book excluding L1: Rs. 360 crores (EPC + manufacturing).
→Telecom segment order book: Rs. 110 crores.
→Railways and transmission manufacturing order book: Rs. 90 crores.
→Order execution for EPC projects expected to be completed over the next 18-20 months.
→Rs. 250 crores EPC orders include a significant portion from Reliance.
→New POs expected soon related to L1 status for Rs. 110 crores.
→Company targets 15-20% growth in turnover, with focus on expanding railway orders.

Capex plans

→No significant CAPEX was done in FY19; only maintenance CAPEX for cranes, machinery, and infrastructure improvements.
→No CAPEX planned for the current/future year as mentioned in multiple responses.
→The focus is on optimizing existing capacity rather than expanding through new capital investments.
→Strategic growth is expected through increasing revenue in telecom, railways, and EPC sectors rather than through new capital investments.
→The company is limiting expansion in EPC to manage working capital cycles rather than making large capital expenditures.

How does Salasar Techno Engineering Ltd rank vs peers in Industrial Manufacturing?

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