MTAR Technologies (MTARTECH) Q1 24/25 earnings summary

Executive summary

• Delivered 814 hot boxes and 22 electrolyzers in Q1, with Q2 guidance of 990 hot boxes and record revenue of INR 200 crore; maintains leadership in critical engineered products with a diversified order book of Rs. 894.2 Cr as of June 30, 2024.

• Q1 FY25 revenue at Rs. 128.3 Cr, down 10.3% sequentially; EBITDA at Rs. 16.6 Cr, down 8.9% QoQ; PAT at Rs. 4.4 Cr, down 9.1% YoY; consolidated revenue from operations for Q1 FY25 was ₹1,282.60 million, down from previous quarters.

• Strong demand from Bloom Energy and new orders for 140 servers; significant new orders in clean energy and defense sectors.

• Aerospace and oil & gas verticals progressing, with new state-of-the-art plant in Hyderabad and first articles for oil & gas underway; results include performance from subsidiaries Gee Pee Aerospace and Defence Private Limited and Magnetar Aero Systems Private Limited.

• Strong ESG focus, with 85% of FY23 revenue from climate-positive products and a D&B ESG rating of 2 (good), outperforming industry in environment and governance.

Financial highlights

• Q2 revenue expected to reach INR 200 crore, the highest ever, with strong H2 momentum anticipated.

• Q1 FY25 revenue: Rs. 128.3 Cr (down 10.3% QoQ, down 15.9% YoY); Q1 FY25 EBITDA: Rs. 16.6 Cr (down 8.9% QoQ, down 51.9% YoY); PAT: Rs. 4.4 Cr (down 9.1% QoQ, down 78.2% YoY); consolidated Q1 FY25 net profit at ₹44.28 million.

• Segment revenue for Q2: nuclear INR 16 crore, space INR 15 crore, aerospace INR 20 crore, electronics INR 37 crore, clean energy INR 11-12 crore, sheet metal INR 17 crore, hot boxes INR 80-90 crore.

• FY24 revenue: Rs. 580.8 Cr; EBITDA: Rs. 112.7 Cr; PAT: Rs. 56.1 Cr; gross profit margin declined to 47.9% in FY24 from 53.0% in FY23.

• Employee expenses increased to support future growth, expected to normalize to 16% of revenue by year-end.

Outlook and guidance

• FY25 revenue growth guidance of 20%-25% year-over-year, with margins at 22% ±100 bps; order book expected to close at INR 1,000 crore by FY25.

• Long-term agreement with Israeli Aerospace Industries for potential orders of USD 90–120 Mn over 15 years.

• Oil & gas vertical expected to contribute INR 150 crore in FY26, with INR 40 crore capex for facility expansion; new products, including roller screws for defense and space, to launch by FY25 and contribute from FY26.

• Nuclear segment to see revenue build-up from FY26, with major orders expected in H2 and Q3 tenders for refurbishments.

• Export orders in clean energy fuel cells to be executed in FY25 and Q1 FY26.