### **Company Overview** Everest Kanto Cylinder Limited (EKC), established in 1978, is India’s largest and a globally recognized manufacturer of **high-pressure seamless steel and composite gas cylinders**. With over **47 years of industry leadership**, EKC has built a strong reputation for quality, safety, and innovation across critical applications in automotive, healthcare, aerospace, defense, and industrial sectors. The company operates a **global manufacturing footprint** with **four core production facilities**: - **India**: Tarapur (Maharashtra) and Kandla SEZ (Gujarat) - **UAE**: EKC International FZE in Jebel Ali Free Zone, Dubai - **USA**: CP Industries Holdings, Inc. in Pittsburgh, Pennsylvania EKC also has strategic joint ventures in **Egypt** and **Hungary**, reinforcing its international expansion. The company’s annual global production capacity exceeds **1.5 million cylinders**, with plans to significantly expand in the coming years. --- ### **Core Business & Product Portfolio** EKC manufactures a diverse range of cylinders, from **1-litre to 3,000-litre capacities**, serving: - **CNG Cylinders**: For automotive (passenger & commercial vehicles) and City Gas Distribution (CGD) - **Industrial Gas Cylinders**: For oxygen, nitrogen, argon, helium, and air - **Jumbo Cylinders & Skids**: For bulk storage and transport - **Cascades & MEGCs**: For CNG refueling stations and mobile transport - **Composite Cylinders**: - **Type 3**: Metal liner with composite wrap (developed and PESO-approved in India) - **Type 4**: All-composite, lightweight cylinders (manufactured via U.S. subsidiary CP Industries) - **Specialty Cylinders**: Ultra-large hydrogen storage (300 Bar) for ISRO, tube trailers for bio-methane, and fire suppression systems --- ### **Market Leadership & Client Base** EKC holds a **dominant ~50% market share** in India’s high-pressure cylinder segment and is a trusted supplier to over **150 clients**, including: - **Auto OEMs**: Tata Motors, Bajaj Auto, VE Commercial Vehicles, Mahindra & Mahindra, Hyundai, Toyota - **CGD Companies**: Mahanagar Gas, HPCL, Adani Total Gas, Indian Oil - **Industrial & Medical**: BOC India, Praxair, healthcare institutions - **Defense & Aerospace**: Indian Space Research Organization (ISRO), U.S. Navy, foreign military contractors The top five customers contribute ~45% of turnover, reflecting a **strong yet moderately concentrated** client portfolio. --- ### **Strategic Growth Drivers** 1. **Clean Energy Transition**: - EKC is strategically positioned to benefit from India’s push toward **CNG, compressed biogas (CBG), and green hydrogen**. - The government’s target of **15% natural gas in energy mix by 2030** and **tripling CNG vehicle numbers** underpins long-term demand. - EKC is a key enabler of the **National Green Hydrogen Mission**, already supplying hydrogen cylinders in India, Dubai, and the U.S. 2. **Expansion of Manufacturing Capacity**: - **Mundra Plant (India)**: - Greenfield facility expected to be **operational in FY26 (FY27 revenue impact)** - Will produce **Type 1, Type 3, and composite cylinders** - Additional **Rs. 50 crore capex** allocated for new production lines - Enhances domestic scalability and export logistics - **Egypt Plant**: - 80:20 joint venture with local partners - On track for **trial production in Nov 2025**, full operation by **Q3 FY26** - Positioned as a **regional hub for Middle East & Africa** - Supports Egypt’s national CNG vehicle conversion program - **Hungary Plant**: - 80:20 JV with Rev Gas Industries - €25 million project (€16 million committed funding), **30% Hungarian government subsidy** - **240,000-unit annual capacity**, aiming for EU market access with **duty exemptions** - Expected to be operational in **FY24**, enhancing foothold in Italy, Germany, France, and Hungary 3. **International Presence & Exports**: - EKC exports to **over 25 countries**, including the USA, Europe, South America, Southeast Asia, and Africa. - The Dubai facility acts as a **key export hub** for global markets and helps **reduce group inventory costs**. - PESO and CCOE approvals enable **global cylinder exports**, including back to India. --- ### **Innovation & Technology** - EKC is at the forefront of **composite cylinder development**: - **Type 3 cylinders** ready for commercial use in India - **Type 4 (all-composite)** produced via U.S. subsidiary (CP Industries), with future India deployment planned - **R&D and AI Integration**: - Exploring AI for **operational efficiency and process optimization** - Focus remains on **core cylinder business**, with no planned diversification - **Customization & Standards**: - Designs cylinders compliant with **IS, ISO, ECE, DOT, ASME, and EN** standards - Developed specialized products: **300 Bar hydrogen cylinder for ISRO**, **bio-CNG tube trailers**, and **high-pressure storage complexes** --- ### **Sustainability & Make in India** - EKC supports the **"Make in India"** initiative by **sourcing components locally** that were previously imported. - Investments in **greenfield plants in India, Egypt, and Hungary** reflect long-term commitment to **localization, cost efficiency, and sustainability**. - **Laser QR marking** enables full **traceability and digital monitoring** of cylinders. --- ### **Financial & Operational Highlights** - **Capacity Utilization (India)**: ~70% (as of Q2), excluding new Mundra and Egypt facilities - **U.S. Subsidiary (CP Industries)**: - Order book of **$40–50 million** (to be fulfilled in 18 months) - Margins stabilizing around **10%** - **Capex Strategy**: Expansion funded **internally via strong cash flows**, reinforcing financial strength and low leverage - **Divestment**: Sale of Chinese subsidiary (~Rs. 105 crore) improved liquidity and supported **debt reduction**