# 1. Financial Performance ## A. Key Figures * **Total Income:** ₹224 Cr consolidated Q2 (+27%) · ₹478 Cr H1 (+27%) * **EBITDA:** ₹58 Cr H1 (+103%) · **Margin:** 12% (+446 bps) * Net Profit: ₹14 Cr Q2 (+491%) · ₹28 Cr H1 (+423%) · EPS: ₹1.43 Q2 (+347%) · ₹2.81 H1 (+290%) * Debt: ₹103.22 Cr (−27% from ₹141.28 Cr) · Debt/Equity: 1.19 (from 1.81) * Current Ratio: 1.67 (from 1.35) · Interest Coverage: 3.62 (from 1.89) ## B. Revenue Growth * **Pricing Momentum:** Strong double-digit top-line growth underpinned by **improved realizations**, with galvanized and pre-painted steel prices up **mid- to high-single digits** year-on-year. * **Volume & Mix Support:** Robust demand across segments contributed to sustained revenue expansion in both Q2 and H1. ## C. Profitability Trends * **Margin Expansion Accelerates:** EBITDA and net margins surged on **favorable product mix**, **operational efficiency**, and **higher capacity utilization**, which drove gross margin improvement from 20% to 31%. * **Earnings Leverage:** Bottom-line growth significantly outpaced revenue, reflecting strong operating and financial leverage. ## D. Balance Sheet Health * **Deleveraging Progress:** Significant reduction in debt and debt-equity ratio, supported by internal cash flows and equity infusions, strengthens credit profile. * **Liquidity Reinforced:** Sharp improvement in current ratio highlights efficient working capital management and enhanced short-term financial resilience. ## E. Cash Flow & Leverage * **Funding Flexibility:** Raised ₹87 Cr via preferential allotments, with ₹36 Cr received in H1 and **₹65 Cr pending conversion**, providing runway for expansion. * **Capital Efficiency:** Strong profitability and lower finance costs drove interest coverage above 60, underscoring robust debt servicing capacity. --- # 2. Product & Segment Performance ## A. Key Figures * **Galvanized Steel Production:** **26,572 MT** (+8%) * **Pre-Painted Steel Production:** **21,653 MT** (+18%) ## B. Pre-Painted Steel Mix * **Strategic Shift Confirmed:** Intentional pivot from galvanized coil sales to pre-painted steel reflects focus on **higher value-added, margin-accretive products**. * **Vertical Integration Strength:** High internal consumption (80–90%) of galvanized steel for PPGI manufacturing enhances cost control and supports margin resilience. ## C. Galvanized to Alu-Zinc Shift * **Premium Product Upside:** Alu-zinc steel commands market premium due to **superior durability and aesthetics**, with management highlighting its positive impact on future margin potential. ## D. Value-Added Product Focus * **High-Margin Portfolio Driving Growth:** Strong H1 performance underpinned by disciplined shift toward **niche, customized applications** in HVAC, appliances, and specialty vehicles, enabling better price realizations. * **Export Expansion & Margin Leverage:** Manaksia is scaling export presence and optimizing capacity utilization to protect margins, with **pre-painted steel delivering higher EBITDA per ton** than commoditized alternatives. --- # 3. Capacity & Production ## A. Key Figures * **Alu-Zinc Capacity:** **180,000 tons/year** (+36% from 132,000) * **CAPEX Commitment:** **₹150 Cr** committed · **₹50 Cr** spent * **Solar Power Plant:** **7 MWp** capacity · **50–55%** grid dependency reduction ## B. Alu-Zinc Capacity Expansion * **Strategic Shift to Alu-Zinc:** Full conversion of expanded capacity to alu-zinc marks a structural pivot from galvanized steel, establishing **100% alu-zinc coating capability**—a rare differentiator in India. * **Margin & Cost Leverage:** Capacity scale-up and integration of value-added lines aim to **lower fixed cost per ton**, protecting and potentially expanding EBITDA margins. * **Phased Execution on Track:** Alu-zinc line to be commissioned in **FY26**, with pre-painted line and solar plant in **early FY27**, with management signaling **no expected delays**. * **Interim Sales Strategy:** A **4–6 month surplus** of unpainted alu-zinc is expected before color coating capacity comes online, to be monetized in domestic and export markets. * **Future Scalability:** Long-term vision includes **doubling alu-zinc capacity to 360,000 tons** and **backward integration via a cold rolling complex**, pending future funding. ## C. Color Coating Line Addition * **Value-Add Expansion:** Second color coating line will significantly boost customer reach and product mix, leveraging **surplus coating capacity** to process externally sourced substrates when economically viable. * **Capacity Gap Management:** A **50,000-ton gap** between alu-zinc and pre-painted steel capacity will be bridged via **external procurement**, ensuring throughput efficiency. ## D. Solar Power Integration * **Energy Cost Mitigation:** The **7 MWp captive solar plant** will cut grid reliance by over half, delivering **material energy cost savings** and strengthening ESG positioning from **early FY27**. --- # 4. Export & Geography Mix ## A. Key Figures * **Export Revenue:** **85%** of total sales (↑ from 25%) · **+151% YoY** growth * **Export Tonnage:** **20,590 MT** (record volume) ## B. European Market Share * **Pan-European Reach:** Strong footprint across Southern, Central, and Eastern Europe, with direct sales to **end-user OEMs**—no reliance on traders or distributors. * **Global Diversification:** Active presence in Latin America (Colombia, Ecuador, Brazil) and growing exposure to Middle East markets. ## C. Latin America & Middle East * **Low Concentration Risk:** Export customer base spans **40–50 active clients** annually, with **no single customer exceeding 10%** of export sales. * **Strategic Focus Maintained:** Continued emphasis on OEM-centric export model to reinforce brand value and market positioning. ## D. Export Revenue Contribution * **Export Dominance:** Record international demand drove exports to an all-time high of **85% of sales**, supported by operational scalability at the Kutch facility. * **Sustained Global Momentum:** Despite near-term peak, exports expected to remain **consistently above 50%** of revenue this fiscal. --- # 5. Order Book & Demand ## A. Key Figures * **Order Book:** **₹600 Cr** (from ₹450 Cr) * **Revenue Execution:** **₹220 Cr** generated in quarter from order book ## B. Order Book Value * **Strong Bookings Growth:** Order book expanded significantly on the back of new export MOUs and increased domestic market penetration. * **Execution Momentum:** Robust quarterly revenue realization reflects efficient conversion of order book into sales. ## C. Execution Timeline * **Near-Term Revenue Visibility:** Current order book has a 12-month average execution horizon, supporting revenue visibility into next fiscal. ## D. OEM Customer Demand * **Infrastructure-Led Demand:** Unpainted alu-zinc sees strong uptake in industrial and public infrastructure projects, driving core volume growth. * **Pricing Agility:** **20–25% of volumes** tied to spot market with **fortnightly price adjustments** linked to raw material indices, mitigating margin volatility. --- # 6. Risks & Raw Material Exposure ## A. Key Figures * **Back-to-Back Model Coverage:** **80%** of business · **75–80%** of production volumes ## B. Input Cost Volatility * **Structural Cost Protection:** Majority of operations shielded from commodity volatility via back-to-back pricing, minimizing margin risk from input swings. * **Favorable Material Shift:** Transition to alu-zinc steel enhances margins, supported by **aluminum’s cost advantage over zinc**. --- # 7. Guidance & Outlook ## A. Key Figures * **Steel Production Target:** **30 Cr tons by 2030** (India) · **50 Cr tons by 2047** (India) * **Capacity Utilization:** **75% to 80%** expected for revenue ramp-up from new lines ## B. Capacity Utilization View * **Confidence in Momentum:** Strong H1 FY26 performance underpins confidence in sustained growth via disciplined execution and strategic asset upgrades. * **Coating Transition Update:** The previously guided **40% EBITDA uplift** from full aluminum-zinc coating shift was not reaffirmed, with no explanation provided. * **Price Stability:** Steel prices expected to remain **relatively stable**, in line with Q2 trends, supporting predictable revenue planning. ## C. Revenue Generation Timeline * **Growth Catalysts:** Indian steel sector poised for structural expansion, driven by **National Steel Policy**, **PM Gati Shakti**, and **PLI/Make in India** incentives for value-added and green steel. * **Revenue Ramp Schedule:** Zinc project to contribute from **FY '26**, while second pre-painted and color coating lines to commence in **early Fiscal '27**. * **Monetization Framework:** Future revenue to be driven by capacity scale and **utilization rates**, with realization trends consistent with current market levels. * **Funding Strategy:** Company actively evaluating fundraising options to support expansion beyond current capex plan.