Kilburn Engineering Limited (522101) Earnings Call Transcript
August 8, 2025
Earnings Call Speaker Segments
Good day, ladies and gentlemen, and thank you for attending this virtual meeting. I'm pleased to welcome you on behalf of Kilburn Engineering Limited and SKP Securities to Kilburn's Q1 FY '26 Earnings Webinar. We have with us Mr. Ranjit Lala, Managing Director; Mr. Amritanshu Khaitan, Director; Mr. Sachin Vijayakar, CFO; Mr. K. Vijaysanker Kartha, Managing Director, M.E. Energy Private Limited; Mr. Amol Monga, Whole-Time Director, Monga Strayfield Private Limited. Friends, this virtual meeting is being recorded for compliance reasons. And during the discussion, there may be certain forward-looking statements. These were reviewed in conjunction with the risk that the company faces. We'll have the opening remarks from Mr. Lala followed by a Q&A session. Thank you, and over to you, sir.
Thank you, Navin. Good afternoon, everybody. A warm welcome to all for the Q1 2026 earnings call and the latest updates of the company and its subsidiaries. This quarter marks the first full period consolidation of Monga Strayfield acquired in Jan 2025. As a group, we have delivered a strong operational and financial performance, thus setting a strong foundation for the year ahead. Coming to a brief on the financials for the quarter. Kilburn had a top line of INR 94.67 crores for the quarter with operating EBITDA of 25.49%. This is a year-on-year growth of 48% on top line and 47% on EBITDA. On a consolidated basis, we achieved a top line of INR 129.25 crores with EBITDA of 25.77%. For the current financial year, we have an excellent inquiry pipeline of INR 4,000 crores plus at consolidated level, and we continue to maintain the target of 50% growth in revenue over the last year, which was stated in the last call as well. As a group, we ended Q1 with a backlog -- order backlog of INR 447 crores. And additionally, since 1st of July, we have received the LOIs and orders worth INR 98 crores. We are also pleased to inform you that the Board has in principle approved the brownfield expansion of our existing unit at Saravali, which entails a CapEx of around INR 30 crores with a time line of March 2026 approximately. With this, I would like to hand it over back to Navin.
[Operator Instructions] We take the first question from [Sagar Shah].
First of all, very congratulations for the entire team of Kilburn Engineering for posting such healthy set of numbers. My first question was on the Kilburn on the stand-alone level. On the stand-alone level, we posted very healthy performance, but I wanted to understand that -- the driver behind the margins. Is it -- I understand it's a project business, but are we diversifying to some new products or some very heavy products due to that, actually, the margins are getting more enhancing actually? And secondly, I saw the diversification in your investor presentation. It was heartening to see that now we are catering to multiple sectors a year ago, we were catering to hardly 3 or 4. Now even nuclear energy is in our basket with an order book of INR 49 crores. So wanted to understand if these margins are driver because of some new sector addition? Or is it because of new product addition? That is my first question.
Well, if you look at the last quarter, I would say that it's the mix of the orders that has given us these margins. There could have been some orders with higher margins. And that's why we have this upward trend. And this can vary from time to time. In the past, we have mentioned that we will maintain between 20% to 22%. I would say that going forward, we are looking at around 23%. So that's the range I can talk about. And it's got nothing to do with any new sectors. It's just that the blend has been good. Your second question was on the verticals that we are catering to. Well, Sagar, I have mentioned in the past that we are into multiple verticals. And at any point of time, we are addressing inquiries of various verticals. It's just that sometimes some of these orders fall in place, and that's how you are seeing the variations in orders, which is very positive in a way, I should say. In the past, yes, there was a lot of orders from carbon black, now we have from fertilizer, we have from nuclear. And this could again change in the next quarter. So that's the nature of business, I would say.
Okay. So is it just because of the product mix that actually that these healthy margins are being sustained in the last few quarters?
Well, we have scaled up the operations. So automatically, that also contributes.
Right, right. My second question was related to our subsidiaries. I would like to ask Mr. Vijay as well as Mr. Amol Monga as well. In the last 1 year, the collaboration with M.E. Energy was because that there was a shortage of something like the working capital funds. And that is why the collaboration with M.E. Energy actually raised your elbow to even actually garner more and more value of orders actually, the order intake. But in the last 2 quarters as well as this quarter, we are not seeing much of a healthy either of our revenue offtake also or even maybe order intake also as far as the M.E. Energy is concerned. So first of all, I would like to understand what is your plan regarding that. Means, the plant which was there initially in the Phase 1 CapEx is also there now. So what is the update regarding the new sector addition, regarding the new heavy products that you are likely to enter into also? So can you give some update so that at least investors can get some more clarity about the subsidiaries? And as well as to Mr. Amol Monga as well that now with collaboration with M.E. Energy, how are you seeing the company in the next 2 to 3 years? How are you planning to scale up with your existing product radio frequency dryer, sheet metal fabrication, such value-added products that you have, that is complementary to Kilburn's existing portfolio. So how are you seeing to collaborate with M.E. Energy and how are you actually planning to scale up? And obviously, what are the objectives also regarding the collaboration?
Sagar, this is Amritanshu here. Before the 2 directors speak on the 2 subsidiaries, I think it's important for investors to understand that even though M.E. Energy or Monga Strayfield are separate 100% subsidiary, specifically for M.E. Energy, we are utilizing that plant for a lot of job works, which even Kilburn gets. So when you are looking at order booking, it is not correct to only look at the order booking of M.E. Energy because a lot of work, Kilburn is offloading also on to M.E. Energy, which gets consolidated and net off. So the revenue breakup that's why will not give you a clear visibility on the actual work done by M.E. Energy or by Kilburn. So we keep highlighting this in our various investor calls that you have to look at M.E. Energy and Kilburn together, not as a separate entity because there are many common customers who are placing orders on Kilburn, but the job is being done by M.E. Energy. Vice versa, M.E. Energy is also leveraging its client base to get Kilburn entry into some newer customers. So you are correct in saying the order intake has been on the lower side, but the utilization of the factory is towards fullish because a lot of orders are flowing into Kilburn, which is being executed by M.E. Energy as well. If that addresses your first point. Regarding Monga Strayfield, there is not a lot of synergy between Monga Strayfield and M.E. Energy except for systems in the biscuit segment where M.E. Energy provides a baking system and Monga Strayfield has dryers, which can make the quality of biscuits better, but we are still at early days of the acquisition and we will see how we can leverage the technologies of M.E. Energy and Kilburn and integrate with Monga Strayfield to give the customers better solutions, but that is still very early days. And now I would request Vijay and Amol to give a little bit outlook on their businesses going forward. I think then it will address your concerns.
Yes. I will start off with that actually. So we, as mentioned in the investor meets before also, our effort is to enhance our ticket size of orders, focusing on larger and larger packages with the advent of our working together with Kilburn Engineering setting in fully. So as already said, it's a project business. So sometimes the project order booking slows down or it picks up in one order can completely boost up the business. So first quarter, we had a little bit of a low time in terms of intake. But we have done a lot of work for Kilburn Engineering, the things getting manufactured, but consolidated, it will not show as separate figures. Having said that, we have already booked subsequent first quarter closing. We booked our first entry into compressed biogas segment. Another major order on waste to energy from sewage treatment we have entered into, and we are working on many other projects. So very soon, the trends will -- this thing we are looking for major business coming in for manganese furnace-based waste heat recovery system. And these are larger packages and there's some export orders we are working on for Nigeria. So coming this 2 months, 2, 3 months are going to be bullish and we are doing well. And with the factory and its capacity going up, we are geared up for confidently taking larger and larger orders.
Sir, have we gone through the -- have we done the breakthrough in the cement sector?
Yes, we have taken our first order. It is nearing installation. As you know, in capital equipment industry when we approach customers, what is most important is a past track record. So past track record in each industry is highly valuable. So we broke through into cement plant, although it is not the full-fledged waste heat recovery system. This is a positive step and a medium value order on which we are already engaged -- I mean, already executing the [Technical Difficulty]. This will be a major breakthrough past track record for us to go into other cement industries.
Now Amol sir, I think so, will give the outlook, I guess?
Amol, can you speak on the outlook for Monga?
Just to answer from my side because the question was asked was, to be very specific, we are actually quite excited about the synergies that we can find within the group. We are already working on to very early stage needs, that involve agro products. So typically, in our experience, we have always come across applications where radio frequency drying the product that we specialize in or the tech that we specialize in ends being a bit too cumbersome for very high moisture products, but a combination of Kilburn's existing tech and even some crossover between M.E. where we can offer a combination solution of using pre-drying or post-drying using existing Kilburn or M.E. Energy products and provide RF as one zone of the entire line, gives the most optimum cost-effective solution to the customer as well. So we -- to be specifically answer, we are working on 2 very early stage leads, so it's very early and it's also early days for us to be part of the collation. So -- but the future is exciting because we are in the past not had the ability to service this sector with a combination driver, which has always been our long-term need. So that's one major synergy that we look forward to executing over the next 2 to 3 years.
Okay. Fine. Sir, just my last question was related to order inflow visibility for this year and the gross block that we are holding as of Q1 FY '26.
So as I mentioned that we opened -- we closed the quarter with around -- 1 second, let me look at the numbers. Sachin, do you remember the number at which we closed the quarter?
It was INR 447 crores.
And we have received orders worth INR 98 crores since 1st of July. So that's quite a good order booking. And as I mentioned that we have, at a group level, around INR 4,000 crores plus of inquiries. And if you look at the conversion factor, it's been between 20% to 25% for us. So that should give you a fair idea as to where we are headed.
Okay. And last question on the gross block that as on Q1 FY '26, what is the gross block?
INR 110 crores for Kilburn.
And for consolidated, sir?
INR 140 crores.
We'll take the next question from [Priyanka Patel].
And my question is while our overall growth has been very strong, but we have seen some reduction in profit margins. Could you please share the reason behind this margin contraction?
Well, if you compare to year-on-year numbers, I think we are better than last year. So I'm not sure a bit what you're comparing. But again, these margins, the guidance that we have given is always between 20% and 22%. So compared to that, we are still better off. And again, it's the blend of the products that we are manufacturing at any point of time. So that can impact plus/minus percentage here and there.
The next question is from [Dinesh Kulkarni].
Am I audible?
Yes, you are. Please, go ahead.
Really great set of numbers. Sir, my question is like you mentioned that we are expanding the capacity at one of our plants, Bhiwandi plants, by investing around INR 30 crores and expect it to be completed by sometime next financial -- this financial year end. So can you just give us some more background on that like why are we doing? Because if we remember, this discussion was not there maybe like say, 2 quarters ago. And we said we -- most of our CapEx has been done because we acquired quite a few assets nearby as well. So why this CapEx now? Where do you see your capacity utilization now and where it will be once we have this capacity? And how much CapEx you are expecting for the next -- say, this year and next year as well, apart from this?
So if you refer to our last 2 calls, I think in all the calls, we have said consistently that we will look at CapEx from time to time. In the last call, in fact, I mentioned that we will be looking at investing in the second half of the year. So I had mentioned about it. So this is a brownfield expansion, which would add around, let's say, 5,000-odd square meters of working area. And the output that we expect from this new capacity would be in the range of INR 100 crores to INR 150 crores, again, depending on the product mix that we address from time to time. So this is what we are looking at.
Okay. Any other CapEx apart from this in this year or next year?
I also mentioned that going forward, we may be talking about Phase 2 at M.E. Energy. So that also is very much on the table. But we'll do it at the right time.
And any amount, if you could...
For the current expansion, we have budgeted INR 30 crores. And when we look at M.E. Energy, it could be in the range of around INR 7 crores to INR 10 crores, INR 12 crores maybe. The Final numbers will be worked out as we go forward. And be assured that as and when we finalize these numbers, we will keep you updated. Whatever we are mentioning about the CapEx today was sanctioned by the Board yesterday. And today, we are bringing it to the table. So be assured that we will keep you posted.
That's great, sir. And my second question is, sir, we have an order inquiry of somewhere around INR 4,000 crores pipeline. And we -- our win rate is around, somewhere around 20%, 25%. How long this whole process takes, sir, like say, from approaching either a customer or a customer approaches you? How long this whole process, okay, getting that order, usually, how long that process takes?
Anything between 3 to 4 months right up to 12 months. So if we are working with the customers for some greenfield project, we tie up with them well in advance and we exchange the specifications and work out the proposals, so that could take a little longer time. Some of the brownfield projects can take around 4 to 5 months. And if it is smaller machines like your paddle dryers and VGBDs and all, they could take 3 to 4 months. So it all depends on case to case.
Okay. Any export orders we're looking at right now?
Yes, very much. I think over last 2 years, we have increased our export order intake to, I think, around 25% to 30%. So going forward, our focus is very much beyond the boundaries of India.
That's great. Maybe something around the similar lines. We are seeing right now a lot of geopolitical tensions across India, especially India concerned with the U.S.A. Has that -- is there any way you think it will impact the current business or the business in the near future?
Right. So when you look at Kilburn, our exposure to the U.S. market is quite limited. So I will not say that it is zero, but it is limited. And the customers that we have in U.S., I would say they -- we shared a very -- we have a very strong goodwill with them. They have been a committed customer. So I don't -- I feel we can retain them. But apart from Kilburn, Monga Strayfield has a substantial exposure in the U.S. and that I think Amol can address. Amol, can you mention something on the sheet metal business where we have substantial exposure to U.S.?
Yes. Sure. So yes, of course, this is all in the news now about the tariffs that are going on with the U.S. In our -- we have 2 verticals in our business. One of them is sheet metal where we have exposure to U.S. clients. Actually, these U.S. clients have been with us for a very long time. And the discussion around tariffs has been going on for the past few months. And we have received nothing but positive feedback from them where they are very happy with the quality and the price at which we can offer the products that we do offer to them. So we have nothing but positive feedback from them that in spite of tariffs, the business should continue as it's going on. The logical reason for that is also because the quality and the price at which we can offer these products, they're not available very easily outside. So their only other options if they do try to look around would be in places where the tariff is also high for them in any case. So if India is at a high tariff, then the alternatives for them are also at a high tariff. And the second point is that the part we are supplying to them, in their overall costing, is a very low-cost item for them. It is very low cost, although it's a very good product for us in terms of margins and volumes. So an increase in tariff in an item which is in the low-cost segment for them does not impact their overall costing too much. So these 2 factors work in our favor. So obviously, tariffs are not great, but so far, we have nothing to worry about.
Okay. And on the same lines, what is the exposure of Monga to U.S.A. specifically then? Like is it a substantial part of revenue?
If I can just come in here. I think as a company, our exposure to the U.S. is less than 2%. I think it's very, very nominal. For Monga Strayfield also, as we mentioned, an INR 10 crore, INR 15 crore, INR 20 crores in a year. And that also, as Mr. Monga just mentioned, the product is a very low value, small part of the larger product, so even a 50% or 100% duty increase doesn't tilt the needle in terms of cost pressure for the client because the product we are providing is a very, very small percentage of the final product they are making. So to answer it very clearly, we do not see any impact of tariffs on Kilburn's operations or balance sheet or profitability.
We'll take the next question from [Darshil].
Hopefully, I am audible, sir?
Yes, loud and clear. Please, go ahead.
Firstly, congratulations on a great set of results. Sorry, I was able to join a bit late, so if the question is repetitive, I beg my pardon, firstly. So in terms of outlook for FY '26, are we still maintaining the 50% growth rate? Or can we go even more upwards than that also because Q1 was really fantastic?
Well, as of now, we maintain the 50% growth rate, which we have been saying for the last 1 quarter, and I mentioned in my opening remarks also. If there is a further improvement, we will definitely keep you updated.
Okay. Fair enough, sir. And sir, with regards to now FY '27, like post the CapEx, so do we expect to be able to utilize the CapEx fully in the first year itself? Or how do we look at it, sir?
So we expect the CapEx to be completed by March 2026. That's our deadline. Even if it's -- let's assume that it can get delayed by a month here and there, I would say that the new financial year should see our shop up and running. And typically, our past experience shows that we start our production or manufacturing immediately as soon as asset is ready. The same was the case in Ambernath and it should be no different over here. So at least the 3 quarters of next year, we will see the output from that setup.
Okay. That's really helpful, sir. So with regards to our eyes toward FY '27, then like we were first, I think, speaking of 20%, 25% growth. But I think the major chunk can come from a new plant itself. So how would we look at FY '27 per se?
Well, we have actually set a target of growing at 20% to 25% at least for the next 2 years. And to achieve that, this is the investment being done. It may also mean that we will make some investments in M.E. Energy, which I mentioned. So we still maintain that next 2 years, we should be growing at 25%.
Okay. Okay. Fair enough, sir. And sir, just wanted to know in terms of the order pipeline, are there any like big ticket items or how is the order density of that? What now targeting towards? How do we look at it, sir?
Definitely, we have started bidding for the big ticket items, especially after our success in Morocco. So that has given us the confidence in looking at the bigger numbers. And our current inquiry pipeline of INR 4,000 crores does include the big-ticket bids as well.
Okay. So for that, like that -- so there will not be any execution challenge, like a big ticket order would be like INR 70 crores, INR 50 crores, what would be the range of it, sir?
So far, the biggest ticket that we have bagged is INR 125 crores. So yes, we look at projects as big as INR 100 crores as well.
Okay. That's really great to know, sir. And sir, also I just wanted to know like we've been -- you acquired M.E. Energy, Monga. Any other kind of acquisition that you are looking for? And how has the synergy with Monga been right now, sir? Is it completely integrated with us or are there any more levers that we can pull on to?
Yes. So as of now, we are not looking at any acquisition I mean nothing is on the table as of now. The idea is to integrate the whole group well and work very effectively together. As far as synergies are concerned, I think for Kilburn and M.E. Energy, we have been now together for a year. So the synergies are very much active in place. For Monga Strayfield, as I just mentioned in the opening remarks that it was the first quarter since we have taken over the company. And I think they have done pretty well for the first quarter.
We'll take the next question from [Tejash]. I guess there's some technical problem out there. We'll move on to the next question. We'll take the next question from [Abhishek Ringsia].
So my question is regarding the June quarter sales. I see a very good number of sales this quarter. Just wanted to understand any sales which came from the delay in the March quarter sales? And what is the percentage of that in it?
No. The order which was delayed in March, yes, still on hold, I would say, because the customer needs to get back to us on same. Whatever you're seeing is from the other orders, which was smooth and running.
We take the next one from a [Manan Shah].
Congratulations on good set of numbers. Sir, I believe we had started with refurbishing air pre-heaters and then our intention was to start manufacturing and selling. Any update you would like to provide on that, whether we have been able to successfully do the refurbishing and where are we to start selling this product?
Yes. The refurbishment of an air pre-heaters is an ongoing business. We have received a couple of orders as well, one from Reliance. And as far as the new air pre-heaters are concerned, we are bidding for different projects. As of now, I don't think we have an order under execution for the new unit, but refurbishment is a continuous process.
If I can add, we've already made new air pre-heater and supplied it. So it's not that we have not made new air pre-heaters. New air pre-heaters for carbon black have been manufactured. But a lot of them are also for refurbishment. And this is an ongoing process for nearly 3 years now, so not something new.
At M.E. Energy, we recently did a very large air pre-heater for Gas Authority of India, weighing approximately 450 tonnes to numbers.
Understood. That's good to hear. Sir, secondly, we were executing an order on a titanium product. for which we also developed a clean room. Is that order already executed? Or it's still ongoing? And whether any new such orders are there in the pipeline? If you can quantify what sort of order book do we have on the titanium side?
Yes. That order which you are referring to was from Reliance and it has been executive very well with a very positive feedback from the customer. I can say that confidently and proudly.
We are serving multiple inquiries for titanium-based orders. As and when we get it, we'll inform.
Okay. Understood. And in the presentation now, we've started mentioning nuclear also as a sector that we can cater to, and I believe India has very ambitious plan on the nuclear side. So if you can just talk a bit what exactly and what sort of opportunity does it entail for Kilburn?
So if I can just add, nuclear is not something new for Kilburn. Mr. Lala has been there for a few years, but nuclear takes Kilburn back to over 20 years. Kilburn has pioneered cooling solutions for the nuclear sector, working with NPCIL from as early as early 2000s or even late '90s, Sachin can confirm. We have multiple installations at all the different NPCIL plants. Nuclear as a sector was dominant last few years. It has been revised by the government recently. We have already got an order for one of the plants where the expansion is happening. This order came to us through L&T. NPCIL has awarded another large tender to Megha Engineering. We expect to get that order as well. I mean there would be competition, but there are very limited players which make the product Kilburn does. So we will see how it goes. And then obviously, if the small reactor business picks up and nuclear sees a very big boost in the next few years. Kilburn will play a role in nation building when it comes to nuclear.
Sure, sir. That was very wonderful to hear, sir. And I hope the company is able to garner big orders in the nuclear sector as well.
We'll take the next question from [Bharat Gupta].
Am I audible?
Yes, you are. Please, go ahead.
Congratulations for a good set of results. A couple of questions, sir. So first, with respect to -- I know the tariff uncertainty is there in place. But if we look at the end-user industries, particularly with the likes of pharma, chemical or petrochemical. So have we seen any sign of a caution with respect to the order inflows, which are coming in place from these respective industries?
Well, I think the tariffs have just kicked in. So it will take some time to see any impact. As of now, the business has been as usual for us.
Right. But since I think INR 4,000-odd crores are there in pipeline for us, and we do have a strike rate of 25 odd-percent. So just wanted to get a sense like with respect to the end-user industry. If they suffer because of this uncertainty, so in likelihood, we will also be the one who will be facing either the order deferment or -- so what's your take on this?
If I can address this, I think there's too much noise around this tariff, which has been put. Our end-user segments don't only cater to export. As you know, most of our end-user segments have a very high domestic consumption as well. Whatever CapEx programs, which are there, they are a combination of brownfield, replacement and new. Kilburn today enjoys the benefit of getting 30% to 35% of its order intake through replacement. That has nothing to do with what happens largely due to geopolitical concerns like tariff. A large part of our order intake is domestic in nature, again, which has limited impact. Segments where the new brownfield or greenfield happening. So there are these large companies which are doing CapEx, which is not for a short-term oriented situation of 3 months or 6 months. They're looking at long-term growth. We have customers like Reliance, you have Navin Fluorine in the fluorochemical space. You name the customers, they all are very, very large, and they all also have a lot of domestic demand driving their business. So I don't see any concern on that front. The other thing which is happening is we are breaking into various geographies, which are not U.S. but Africa, Europe, Asia Pacific, Korea, where a lot of inquiries are coming through. Over the last 24 months, our inquiry pipeline has doubled from around INR 2,000 crores to INR 4,000 crores. But we are still a small fish. The dryer market globally is over $2 billion. So if you look at dryers being $2 billion, you look at waste heat recovery system only for cement being INR 5,000 crores, we are talking of very large numbers. And if you see the size of Kilburn Engineering, we are relatively a very small player. So we have ample scope and there's enough market for us to cater to. So I don't see any concern from demand creation point of view. I think for us, the critical part is executing successfully and scaling up in a profitable manner and which is what the management is today working at.
Sure. Secondly, with respect to the orders, which I thought we were supposed to get in from Granules India. Any color which you can share on it?
So the Granules order is still on hold. The pilot project has been worked on only once that is successfully commissioned with the larger order be executed.
We take the next question from [Tejash]. Okay, in the meanwhile, we'll take the next question from [Amit Sharma].
Just a couple of quick questions from my end. Firstly, sir, if you could just touch down and elaborate more on the margin side that we are seeing right now, 25%, right? Is it the fact that it's -- a large part of this margin expansion is being driven from that execution of the Morocco-based orders?
Well, that is one of the contributors for sure. But as we scale up our operation, definitely, our margins are expected to improve over a period of time. And that's why I mentioned the -- I mean I think a while back that we can expect between 22% to 23% going forward.
Got it. So you've revised this thing to 22% to 23% now?
Right.
Okay. And secondly, sir, I think earlier in one of our previous interactions, you had briefly alluded that there are multiple opportunities with the same Morocco client that we can scale up the engagement as well as this -- the execution will stand as a proof of concept with the other customers also. So are we seeing any more interaction from that side?
Yes, we have built for a couple of projects for the same group, for the OCP group, and we are at advanced stage of discussions.
And what would be any color on the size of that what that order could look like?
Maybe in the same range.
Okay. Got it. And the margin profile would also be largely similar we can expect?
You can say so.
Okay. Sure. And sir, it's good to hear that the growth expectation that you have got is fantastic. The margins are all really great. Right now, when we think about the business side, while everything is -- all the stars are aligned, what would be that 1 or 2 things which would be worrying you the most or that can derail your plans?
I think we face a challenge on getting the right manpower. That's one of the areas of concern for us, both on the blue collar as well as on the white collar. Retaining talent is a challenge, but we are working on all these areas. On the factory front, as I mentioned, nowadays, there's scarcity of labor. So that is one of the areas which -- where again, we are working.
Okay. And are there any systemic risks that you see from the -- on the business side?
No, not really.
We take the next question from [Prasath].
Congratulations on a good set of numbers. So I have two questions [Technical Difficulty] on NSE listing. I guess from last con call, Board has approved for NSE listing. Is there any time line, sir?
Well, we are working on the necessary paperwork that's required for listing, and that may take some time, maybe 6 to 8 months.
Next question is something like we have reiterated INR 650 crores to INR 700 crores of guideline for FY '26, right, sir. So are we sticking?
Yes. As I mentioned, we are looking at a 50% growth of our revenue of last year. So that would be in the range of INR 650 crores.
I think you can keep that INR 650 million to INR 700 crores as a range because in project business, it's very difficult to give a specific number. So as the company guided for 50% top line growth, we are fairly confident of achieving that.
We take the next question from [Naman Bhansali]. We will take a follow-up question from [Sagar Shah].
Yes, sir. I just had one question. What are the key risks that you see actually for your ambitious 50% top line and 23% margin outlook? What are the key, maybe company-level risks or maybe you see on ground or sector-level risks? So what are the key risks that you actually see for this actually ambitious guidance that you have given?
Well, as far as the guidance that we have given is based on the current order booking and the orders which are expected. So from the order intake perspective, I don't see any risk. We have also gained a lot of momentum from the last quarter, which continues, and we expect -- on the execution front, and we expect that to continue. So there too, I do not see a major risk. However, being a project business, if some orders go on hold, which is quite unlikely at this point of time, that can be one risk. Yes, that's all in pricing. I mean, as of now, some customer delays in taking the equipment, that can be a risk. Otherwise, I don't see any further risk.
So like the Granules case, are you seeing some more customers flowing out? Or are you seeing steady at least in the other segment? What are you seeing on the ground?
I think it has been very steady. If you talk about last year, 2 projects had gone on hold, right? Granules was one of them. The other one, it went up smoothly after that. So that is just a temporary phase. Once we get a clearance, then it would move very fast. But when I'm talking about the 50% growth, even if Granules takes a while to move forward, we have sufficient pipeline. So I don't see a risk from that perspective.
Okay, sure. And last one on M.E. Energy. What is the average ticket size of the products that actually we are selling on a stand-alone level, not on a group level, but stand-alone level, M.E. Energy, the average ticket size of the products? Obviously, the average ticket size will consolidate all the products, right from small to even big products.
Mr. Kartha, can you take that?
Yes, average ticket size is sub INR 2 crores now. Our effort is to take it to a much higher level also because of the low value high-volume, high number, small size heaters that we do. We -- our effort is to go into larger and larger order with this.
We take the next question from [Tejash].
Sorry for the technical glitch here. So my question, Mr. Lala, you can answer is -- so I was just going through the PPT. We have mentioned that this year, we have received new orders of INR 98 crores. But if I see the declarations made to the stock exchange this year, there were 4 declarations made. One was INR 28 crores, one was INR 30 crores, one was INR 36 crores and one was INR 30.79 crores. That adds up to INR 125 crores. So is that just a matter has been canceled and that's why this gap is new year because we have been negligent...
This INR 98 crores is post 1st July.
INR 98 crores is post 1st July?
Yes. First, your order booking in Kilburn was around INR 65 crores for the quarter. But since we got substantial orders from 1st July to 7th August, we added that as additional information.
Okay. So this -- so it is not from April to -- this is not for first quarter. It's only for July, INR 98 crores?
July onwards. 1st July onwards.
Sir, and the second question was that since we are currently at -- I think the closing order book is INR 440 crores. And if we add that the current that we've done this quarter, the total year figure looks more closer to INR 570 crores, INR 580 crores. And a little shade short of INR 650 crores because as we have been discussing in the previous meetings, as you have shared that usually it takes 7 to 8 months to complete our orders. So we are already in August. So do you think we'll be able to hit the INR 650 crores or INR 640 crores, even close INR 620 crores, INR 630 crores number by this year-end, sir?
Well, a number of orders are in advanced stage of discussions and a lot many orders should be coming in this quarter. And when it comes to revenue, you know very well that we book revenue on POC basis. So even if there's a slight delay by a month or so, there will be substantial time to complete it on a POC basis, and we will touch that figure.
Also, I would like to add that the tea dryers which Kilburn supplies, where we have 80% plus market share, those are short-cycle orders, which typically come in, in the month of November and is supplied largely by March. So you have INR 20 crores, INR 30 crores of revenue there, which comes in, which doesn't factor into your order book. Plus in Monga Strayfield, their typical order cycle and delivery is only 3 months. So the balance 6-month order book you don't see. So if you add all this together, between Monga Strayfield and Kilburn tea dryers, you have INR 50 crores, INR 60 crores of revenue, which will not be reflected the way you are calculating from the order book. So we are very comfortable achieving the 50% guidance which we have mentioned.
No, even after exhibiting INR 129 crores in the first quarter, we have ended with INR 447 crores, plus we have got INR 98 crores of orders. So if we add all together, itself, it will go above INR 650 crores if Monga is included.
Sir, last question is on the pledge. I think we've been seeing this 18.5% pledge for a long time. So any plans of clearing, unpledging that...
There is no pledge in the company to take. There is a nondisposal undertaking given by Williamson Magor for INR 43 lakh share, which is 9% of the promoter holding. That's it. But it's not a pledge, it's an NDU.
We have a follow-up question from [Amit Sharma].
Just a quick follow-up. Sir, if you could just touch down a little bit -- taking from the previous participant, right? If you could just touch down a little bit on the order inflow side because last quarter, what we saw was about INR 93-odd crores of order inflow, right? And you guided that from 1st of July until now, we have received another INR 98 crores kind of an order. And when I look at the order book pipeline, what we are seeing, that is about INR 4,000 crores. So even if I were to assume a 25% kind of a conversion. We are talking of close to about INR 1,000 crores of order inflows. So are you saying that probably the second half will see a larger amount of order inflows coming in? Or how -- and is there any -- or is there any kind of seasonality which is there with respect to the order inflows, right? So if you could just throw some color on that.
Amit, we have last time also guided for order booking of close to INR 500 crores to INR 600 crores for the year. We would like to maintain that guidance of INR 500 crores to INR 600 crores of order booking. We have received certain new inquiries because of which the inquiry pipeline has seen a 25% jump in this quarter. For that to fruitify, you can look at it another 12 months going forward. So the way we are looking at it today, I think INR 500 crores to INR 600 crores order booking is something which the management is targeting. But there is an upside risk depending on some inquiries which have come in for this to go up. But we are -- it's still too early days to commit on that.
Okay. So just a quick -- this thing on the number that you said. So if you are looking at INR 500 crores to INR 600 crores of an order booking and we are targeting, let's say, INR 650 crore kind of an execution. So are we saying that by the end of the year, we would be looking at a book-to-bill of less than 1?
So you can say, normally, for our type of business, the book-to-bill would be lower because our execution cycle is between 4 months to 12 months. You will never find a book-to-bill to be 1.5x, 2x revenue. The DNA of the business doesn't allow it. Unless we get some orders, which are long gestation, that will be different. But typically, that's not the case.
We have a participant -- just one second, please. A couple of things on the Q&A board. [Samrat Shah], he wants to thank the Kilburn team for doing the amazing work. And we have a question from [Naman Bhansali]. When We guide for INR 650 crores top line, how would it be split between stand-alone Kilburn, M.E. and Monga? And secondly, do we have any margin expansion levers available in M.E. Energy business from 15% to 17% towards the 20% mark?
So if you can see -- generally, we don't give breakup of each company. As I mentioned earlier also, a lot of M.E. Energy turnover could be added into Kilburn itself. But from a stand-alone point of view, I believe Kilburn alone should be at around INR 450 crores to INR 500 crores, that should be the kind of range we should look at. And M.E. Energy and Monga should add about INR 200 crores. I mean that's how the visibility is looking like for this year.
And the second part of the question was, are there any levers for margin expansion from 15% to 17% towards the 20% mark?
So as economies of scale happen and the businesses scale up, I'm sure there will be margin expansion. Mr. Kartha, I think he can address this, but he needs to get some big orders, automatically, the margins will go up.
In project business, it's not that you ramp up your people strength and other resources after we receive the order. You gear up and then go after larger value orders. So that gearing up portion adds to the cost in the beginning, but subsequently, it gets justified when the large order values gets the same. So compared to last year, M.E. Energy has worked substantially on building an organization, which can take INR 40 crores, INR 50 crores single value orders. Now this time, we are expecting the orders to start coming in and the execution to start. So the expansion of margin and the scale -- the benefits of the scale of operations should kick in towards the center of the year or maybe next year onwards.
There's another margin-based question. [Raj Saraf] asked, can we expect the margin bump up in FY '26 and FY '27? This, I'm assuming, is at an overall level.
See, we've been guiding at around 20% EBITDA margin. Mr. Lala has indicated this year 22% to 23%. So that is automatically guiding for a better overall margin. It's very difficult to commit numbers and not achieve or have a risk of not achieving. So we -- the management always prefers to give a conservative guidance in terms of margins. And hopefully, we'll be able to do better than that.
[Rohan Sharma] is asking, is there any operating leverage kicking out on a consolidated basis after the acquisitions?
So Monga Strayfield as a business is very high margin. I think that automatically will help us overall add to better EBITDA margin. M.E. Energy, as we've discussed in the past, is in the process of scaling up and we believe that they can also have higher margins once the scale up happens. So when we are guiding for 22%, 23%, that's at a blended level for the total group as a whole.
We have a couple of more questions. Do we have time to take them?
Yes, sure.
[Abhijit Mitra].
A couple of data questions. So last 2 quarters, we have seen the order pipeline to increase from INR 2,000 crores to INR 4,000 crores now. So what would be the average ticket size of that incremental INR 2,000 crores?
I would say the maximum size that we're looking at would be in the range of INR 150 crores to INR 200 crores. Average could be around, let's say, INR 50 crores to INR 60 crores.
INR 50 crores to INR 60 crores. Okay. Got it. So that leads -- I mean, on an overall order pipeline, your ticket size is increasing. I mean on a blended basis, you would have reached INR 20 crores, INR 30 crores by now at least, right?
Yes. But at the same time, we get orders worth INR 7 crores, INR 10 crores, INR 15 crores. So it's not that we don't take small orders. Yes, the overall ticket sizes increase.
Got it. And just to understand, when you sort of guide for INR 500 crores to INR 600 crores of order inflow for the full year, have you assumed in that follow-on order from OCP?
Yes, very much.
And if you can share what is the amount that you have assumed, you can share that.
We can't give that level of details, I'm sorry.
Got it. Got it. No, that's perfectly fair. And if that materializes, what time frame is it expected to materialize in Q3, Q4? Or maybe end of -- closer to the end of the year, probably you can see as quickly as in Q2, Q3?
We are addressing multiple inquiries from the fertilizer segment, whether it is OCP or others. So you will see the company getting orders in the fertilizer segment through the year. We recently bought a large order from Coromandel Fertilizers as well. So fertilizer will play a key role, I think, as a sector for the order inflow coming in, in the next 12 to 18 months.
Got it. Got it. Understood. Understood. And just to sort of refresh my memory, I think the first order value was around INR 120 crores, right? So -- and they would have sort of similar modules planned, say, over the next 2 years, 3 years. So what is their planning, if you sort of can share? I mean, what is the total addressable market from OCP?
We don't have that detail. I can only tell you that the order we got is for a new plant, which OCP is setting up. And that's their plant #29. They have 28 other plants, and they also have inquiries which come in for replacement dryers. You're talking about one of the -- you're talking about the world's largest producer of phosphate which virtually is running the country in terms of the economy for Morocco. So they are very large. So it will be wrong for us to comment or discuss on what kind of opportunities are there. But the good part for Kilburn is, they got entry into one of the largest players in the fertilizer space globally, and we hope to leverage that in the coming years.
We will take one follow-up question from [Tejash].
Just I'm assuming that when we make these declarations for the orders on the stock exchanges, we do -- we have a threshold of declaring the orders. We don't declare all the orders, I'm assuming that. So it will be helpful -- if that is correct, it will be helpful in those declarations, if you can just mention the total order value at that time is possible so that the -- we can track it properly. That's something that you can consider. I think you only -- I think there's a threshold of INR 20 crores, INR 30 crores, above that only you declaring the orders if I'm not wrong because we have only 2 or 3 declarations on the stock exchanges, which adds up to INR 60 crores in July versus INR 90 crores, which you have been sharing now. So that's my submission.
We take your feedback and we'll see what we can do.
We have a question from [Laksh Malhotra]. I wanted to congratulate Kilburn team for the good quarter. Also appreciate the confidence in growth for this financial year as well as further 25% top line guidance for FY '27 and '28, both for top line and bottom line. Hope you continue to get the bigger orders and get margins. Now the question, would be helpful to know the current cash flow position? What's the update on tech tie-ups we spoke about with U.S. and EU and Japan? Also, acquisitions once M.E. and Monga are well integrated, are we planning to do it for top line bump up? If you want, I can read the questions again?
I'll go one by one. Cash flow, Sachin will answer. As far as the acquisitions are concerned, as I mentioned earlier that we are not looking at any further acquisitions at this point of time. The idea is to stabilize the operations across the group and grow well in line with our vision. As far as our tie-ups are concerned, we already have a tie-up with Nara of Japan. And we are working on a couple of other -- and with IDRECO of Europe. We also are working with another European company, which is at a very early stage. So as we go forward and we have an arrangement with them, we will definitely keep you updated. The third one was on the cash flow. Maybe, Sachin, you can throw some light on that.
Mr. Lala, that was -- what's the update on the tech tie-ups we spoke about with the U.S., E.U and Japan?
We are in discussions for various technology tie-ups. And I think for acquisitions is something also if tomorrow any opportunity comes for the company, we will look at it. And at the right time, if anything materializes, we will really inform the stakeholders. Technology tie-ups is also actively being looked at. And as and when anything materializes, we will inform this stakeholders.
Mr. Vijayakar, with regarding the cash flow.
Presently, our dispatches to -- basically to Thai Carbon and all being affected, we are expecting good cash flows as well as there has been a conversion of warrants also, which were issued maybe 18 months back. So this has brought cash into the company, which is fully utilized for the operations of the company. So we don't see any hindrance from cash flow point of view in the operations of the company.
[Laksh] also says that it's good to see Mr. Vijay and Mr. Amol on today's call, healthy confidence booster to hear from them directly, commitment to company growth. We have the last question, if I can just take it, it's from [Harsh]. In the coming years, do you see Kilburn Engineering reaching a market cap of INR 5,000 crores? Who are its competitors in India? Which ones are ahead? And what advantages do they have over Kilburn?
So we can't comment on market cap as management. That is something for investors to decide what would the market cap of the company be. I think we have stated earlier, the management is focused on driving growth, both top line and bottom line. And we reiterate a 50% growth this year followed by a 25% CAGR growth for the next 2 years. Hopefully, if you achieve that, we will cross the INR 1,000 crores top line segment by FY '28. What was the second question, Navin?
Who are our competitors in India? And what advantages do they have over us?
So do we talk about them having advantages over us or we're having advantages over them?
I think we speak about ourselves.
I think, Ranjit, you can address that.
Well, some of the peers that we have are like Walchandnagar Industries, then GEA Process. So these are the -- Anup Engineering.
GMM Pfaudler.
Yes. So they are the peers, I would say, in the industry. Our strengths, I would say we have been here for 4 decades, and we have an excellent bandwidth of our knowledge, of our experience. We have been putting our resources in place as and when required. So we have been trying to be ahead of the market, I can say.
If I can add, I think one of the biggest trends for Kilburn is we provide a bouquet of solutions when it comes to drying. Most of our competitors have 1 or 2 types of dryers to offer, while we have a large bouquet to offer and actually come out with the best solution for our customers. We have very strong, long-standing relations with our customers, which go down decades. And thirdly, I think the acquisitions which we've done have strengthened our product offering where we become a one-stop shop for not only drying, but also waste heat recovery systems, which handles the whole energy management piece. So I think our acquisitions have also had complement us in terms of improving our product offering for our customer base.
Thank you very much. Since we have no more questions, may I hand over the webinar back to Mr. Lala for his closing remarks.
So first of all, thank you for participating in this discussion. I can confidently say that going forward, we see a good traction across the various verticals which we cater to, like fertilizers, nuclear, carbon black, oil and gas. And this is, of course, demonstrated by the strong inquiry pipeline we have. As a company, we -- as a group, we are very confident of maintaining the growth momentum throughout the year. And as we mentioned that our vision or our aim is to be INR 1,000 crores company in FY 2028. So as a team, we are very much committed to this whole vision. And yes, that's all from my end. Mr. Khaitan, you would you like to add something to this?
I think I would like to thank everyone for taking out their time and hearing our call. And we are very excited about the future of the company and look forward to the [repetitive] performance in the coming quarters.
Thank you very much. On behalf of all of us at SKP, thank you very much, Mr. Lala, Mr. Vijayakar, Mr. Khaitan, Mr. Monga and Mr. Kartha for taking time out to interact with the investors. We look forward to watching you again.
Thank you, Navin.
Thank you, Navin.
Thank you, Navin.
Thank you very much and have a wonderful day.
Read the full transcript via the API
You're viewing the first half of this call. Get the complete Kilburn Engineering Limited transcript - plus 251,000+ transcripts from 12,000+ companies, speaker segments and full-text search - through the EarningsAPI REST API or hosted MCP server.
Get an API key View API docs →For developers and AI pipelines
Programmatic access to Kilburn Engineering Limited earnings transcripts and 251,000+ others is available through the
EarningsAPI REST API and the hosted MCP server.
Quarterly plans from $105 - full transcripts, speaker segments, full-text search,
and the /api/v1/transcripts/recent polling endpoint for ETL pipelines.