Kilburn Engg. — Q3 FY25 earnings call

Call held 12 Feb 2025

Management summary

Kilburn Engineering reported strong Q3 FY25 results with consolidated revenue of ₹108.27 crores and an EBITDA margin of 21.68%. The company successfully acquired Monga Strayfield, enhancing its drying solutions portfolio, and secured its largest-ever export order of $15 million. With a robust consolidated order book of ₹409 crores and a strong enquiry pipeline, Kilburn maintains its FY25 revenue guidance of ₹450-₹500 crores and projects ₹650-₹700 crores for FY26, driven by subsidiary contributions and strategic expansions.

Highlights

  • Q3 FY25 Standalone Revenue: ₹91.1 crores, EBITDA Margin: 24.60%.

  • Q3 FY25 Consolidated Revenue: ₹108.27 crores, EBITDA Margin: 21.68%.

  • Consolidated Order Book (as of Dec 31, 2024): ₹409 crores.

  • Group Order Inflow (current quarter): over ₹35 crores.

  • Acquisition of Monga Strayfield completed on Jan 27, 2025, now a 100% subsidiary.

  • Awarded largest-ever export order of $15 million from JESA for OCP Morocco.

  • FY25 Consolidated Revenue Guidance: ₹450-₹500 crores.

  • FY26 Consolidated Revenue Guidance: ₹650-₹700 crores.

Key financials

2 periods

Consolidated Q3

  • Revenue
    ₹108.27 Cr
  • EBITDA Margin
    21.7%

Standalone Q3

  • Revenue
    ₹91.1 Cr
  • EBITDA Margin
    24.6%

What they filed

Q1 FY27: revenue down 9.3%, net profit down 38.1% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue104 108 127 129 154 +48%157 +45%189 +49%117 −9%
EBITDA23 23 36 33 40 +74%36 +57%38 +6%21 −36%
Net profit15 15 20 21 27 +80%23 +53%25 +25%13 −38%
How to read this

₹ crore, as filed. The percentage beside a figure is the change against the same quarter a year earlier — never the quarter before, which would make every seasonal business look like it collapses and booms each year.

Order book

high confidence

Total value

₹409 Cr

as of 2024-12-31 quantified

Inflow this quarter

₹35 Cr

Composition

Mix 2 subsidiaries
  • Kilburn ₹368 Cr 90%
  • M.E. Energy ₹41 Cr 10%

Share of order book by subsidiary, derived from disclosed amounts

Pipeline

qualified rfp

Current enquiry pipeline of over ₹2,000 crores, including ₹1,400 crores for Kilburn and ₹600 crores for M.E. Energy across different verticals.

Cancellations & deferrals

  • deferred: One very large order was kept on hold, resulting in lower guidance, but is expected to get into execution in Q2 FY26.
The company has a strong order book and a robust enquiry pipeline, with some orders previously on hold now moving into execution, ensuring revenue visibility.

Source: Prepared remarks

Capital allocation

high confidence
  • Capex ₹5 Cr
    • M.E. Energy Phase 2 expansion ₹5 Cr
    Our current CapEx, which is expected would be for M.E. Energy, this is the second phase of expansion, okay? That could be maybe around ₹5 crores to ₹10 crores, let's see.
  • M&A Monga Strayfield Acquisition · Closed

    Strengthens presence in India and abroad, develops capability in drying solutions based on RF technology.

    Expected to contribute ₹90-₹100 crores revenue in FY26, adding ₹100 crores to next year's top line.

    Kilburn has successfully completed the acquisition of Pune-based Monga Strayfield on Jan 27, 2025 which is now a 100% subsidiary of Kilburn.
  • Liquidity Liquidity disclosed Inflow from warrants conversion in FY26 (₹120-₹140 crores) will be used for long-term working capital, CapEx, general corporate purposes (including further acquisitions), and repayment of long-term debt.
    So whenever any inflow will come in due to the equity raise, which has happened, it will be used as per what has been approved by the Board that has already been pre-decided as long-term working capital, some part as CapEx, some part will go for general corporate purpose, which could be any further acquisition and some part as repayment of long-term debt.

Guidance & targets

Revenue

  • Consolidated Revenue Revenue · FY25 · High confidence ₹450-₹500 crores
    we expect the current fiscal year to have a turnover of between ₹450 crores to ₹500 crores.

    — Ranjit Lala

  • Consolidated Revenue Revenue · FY26 · High confidence ₹650-₹700 crores
    well poised to be in the range of ₹650 crores to ₹700 crores at the group level.

    — Ranjit Lala

  • Monga Strayfield Revenue Revenue · FY26 · High confidence ₹90-₹100 crores
    next financial year, Monga Strayfield should contribute anywhere between ₹90 crores to ₹100 crores of revenue.

    — Amritanshu Khaitan

  • M.E. Energy Revenue Revenue · FY25 · High confidence ₹100-₹110 crores
    M.E. Energy should cross the ₹100 crore mark. So we are looking at between ₹100 crores to ₹110 crores in the current fiscal.

    — Amritanshu Khaitan

  • Kilburn Standalone Revenue Revenue · FY25 · Medium confidence ₹300-₹350 crores

    Previously ₹380 crores → ₹300-₹350 crores

    may not reach that figure of ₹380 crores, but somewhere we are looking at, let's say, between ₹300 crores and ₹350 crores, we should be able to achieve that.

    — Ranjit Lala

  • M.E. Energy Revenue Revenue · a year or so · Medium confidence ₹150-₹200 crores
    The idea is to take it to ₹150 crores and then ₹200 crores and gradually, we will go forward.

    — Ranjit Lala

Margin

  • Consolidated EBITDA Margin Margin · FY25 · High confidence 20% plus
    We remain confident of maintaining a margin of 20% for the current fiscal year at group level

    — Ranjit Lala

Order Intake

  • Group Order Intake Order Intake · FY25 · High confidence ₹500 crores plus
    at the group level, we expect that we will close the order intake at ₹500 crores plus.

    — Ranjit Lala

Capacity Utilization

  • Ambernath Factory Utilization Capacity Utilization · June 2025 · High confidence 100%

    From 50% today

    Ambernath currently as on date is 50% utilised, and I expect it to be 100% utilised by June, which I mentioned in my opening statements.

    — Ranjit Lala

What to watch in Q4 FY25

Monga Strayfield CapEx/Expansion Plans

Next quarter
Current Not looking at expansion as of now, but will assess.
Target Specific CapEx plans for Monga.

Why it matters

Monga is a new acquisition, and its future CapEx plans will indicate growth strategy and investment needs.

don't see any CapEx for Monga, okay. Maybe in the next quarter, we can answer that better.

Risks & concerns

  • Macroeconomic slowdown / Industry slowdown

    low

    Management stated they are not seeing a slowdown due to diversified portfolio and robust enquiry pipeline, with specific sectors like nuclear and soda ash showing increased activity.

    Analyst downplayed

  • Commodity price volatility / Rupee depreciation

    low

    Management noted potential positive impact from rupee depreciation on dollar orders but minimal impact from input costs as most raw materials are domestic (6-8% imported).

    Analyst acknowledged

  • US import tariffs / Tariff war

    low

    Management stated it's too early to assess impact and they are focusing on their business, not external geopolitical events.

    Analyst downplayed

Q&A highlights

7 direct
FY25 Revenue Guidance vs. 9M Performance Direct
Given the cleared orders, which were on hold by customers in the previous two quarters and some revenue spillover into the next financial year, we expect the current fiscal year to have a turnover of between ₹450 crores to ₹500 crores.

Clarifies how the company plans to achieve its full-year revenue target despite a lower 9M run rate, attributing it to cleared hold orders and Q4 execution.

Asked by Aman Soni

Impact of Macro Slowdown on End-User Industries Direct
I don't think there's a slowdown. And even if you find maybe some enquiries may be coming less on the carbon black side, but then you have a rise of enquiries on the nuclear side, on the soda ash side. So some of the other projects are definitely happening.

Addresses investor concerns about broader economic slowdown affecting demand, with management asserting resilience due to diversified sector exposure and robust pipeline.

Asked by Sagar Shah

Integration Strategy for Monga Strayfield Acquisition Direct
Monga Strayfield will remain an independent organisation. The company has a strong management... leveraging the expertise on areas where Kilburn can get a benefit in terms of manufacturing, especially for sheet metal. And with the technology of radio frequency dryers and the traditional dryers... get our R&D to develop combination dryers.

Details the strategic approach to integrating the newly acquired subsidiary, focusing on leveraging its strengths while maintaining its independence and exploring R&D synergies.

Asked by Sagar Shah

Potential in Nuclear and Cement Waste Heat Recovery Markets Direct
order sizes can be anything from ₹30 crores to ₹50 crores [for nuclear]... larger waste heat recovery boiler system, which is a ₹5,000 crore industry... by FY '27, we should be able to at least get one or two large orders. Typically, those are ₹70 crores to ₹80 crores each.

Highlights significant growth opportunities in high-value sectors like nuclear power and cement waste heat recovery, providing specific order size estimates and timelines for market entry.

Asked by Vinay Nagori

Group Margin Sustainability and Subsidiary Contributions Direct
Kilburn will have the highest margins. I expect Monga Strayfield to be close to that and M.E. Energy to be a bit lower... better to look at a consolidated group margin, which we are guiding for to be in the 20% plus range.

Clarifies the margin profile across the group's entities and reiterates the consolidated margin target, explaining the rationale behind potential differences.

Asked by Darshil Jhaveri

Use of Funds from Warrants Conversion in FY26 Direct
inflow will come in due to the equity raise... used as per what has been approved by the Board that has already been pre-decided as long-term working capital, some part as CapEx, some part will go for general corporate purpose, which could be any further acquisition and some part as repayment of long-term debt.

Provides transparency on the planned utilization of significant future cash inflow, covering various strategic and operational needs.

Asked by Yashvi Kamdar

Capacity Utilization Across Group Plants Direct
current utilisation at M.E. is 100%... Ambernath currently as on date is 50% utilised, and I expect it to be 100% utilised by June... Saravali factory also is around 70% to 80% occupied... For Monga... 85% to 90% utilised.

Gives a clear picture of current and projected capacity utilization across all manufacturing facilities, indicating headroom for growth and the rationale for expansions.

Asked by Samrat Shah

Addressable Market Size with Acquisitions Partial
Monga Strayfield... RF dryer market is about ₹300 crores, ₹400 crores... M.E. Energy, the overall waste heat recovery boiler market could be a couple of thousand crores... cement waste heat recovery boiler market, which is ₹5,000 crores.

Provides a breakdown of the addressable market sizes for the new subsidiaries' core offerings, indicating the significant growth potential unlocked by the acquisitions.

Asked by Ravindranath Nayak

2 min read 7 chapters

Detailed narrative

Strong Q3 Performance and Consolidated Growth

Kilburn Engineering reported a robust Q3 FY25, with standalone revenue reaching ₹91.1 crores and an EBITDA margin of 24.60%. On a consolidated basis, including M.E. Energy, the revenue stood at ₹108.27 crores with an EBITDA margin of 21.68%, reinforcing the group's growth trajectory. This performance reflects operational efficiency despite certain project delays.

Strategic Acquisitions and Portfolio Expansion

The company successfully completed the acquisition of Pune-based Monga Strayfield on January 27, 2025, making it a 100% subsidiary. This acquisition strengthens Kilburn's presence in drying solutions, particularly in radio frequency (RF) technology, and is expected to contribute ₹90-₹100 crores in revenue in FY26. Additionally, the first phase of M.E. Energy's expansion in Pune is complete, with the second phase underway, enhancing thermal solutions capabilities.

Robust Order Book and Pipeline

As of December 31, 2024, the consolidated order book stood at ₹409 crores (Kilburn ₹368 crores, M.E. Energy ₹41 crores). The group also bagged over ₹35 crores in new orders during the current quarter. The enquiry pipeline remains strong at over ₹2,000 crores, comprising ₹1,400 crores for Kilburn and ₹600 crores for M.E. Energy, indicating healthy future visibility.

Revised FY25 and FY26 Revenue Guidance

Kilburn revised its FY25 consolidated revenue guidance to ₹450-₹500 crores, acknowledging some revenue spillover into the next fiscal year due to previously held orders. For FY26, the company is well-positioned to achieve a consolidated revenue of ₹650-₹700 crores, with subsidiaries expected to contribute over ₹200 crores. The group aims to maintain an EBITDA margin of 20% plus for FY25.

Key Export Order and Market Diversification

Kilburn secured its largest-ever export order of $15 million from JESA for the supply of rotary dryers to OCP Morocco, a significant step towards establishing a strong global footprint. The company is actively pursuing opportunities in critical sectors like nuclear, metal recovery, soda ash, and pharmaceuticals, with initial nuclear orders expected in the ₹30-₹50 crores range. Exports currently contribute 15-20% of revenue, projected to increase to 25-30% in the coming year.

Operational Enhancements and Capacity

M.E. Energy is operating at 100% utilization, driving its Phase 2 expansion. Kilburn's Ambernath factory is at 50% utilization, targeted to reach 100% by June 2025, while the Saravali factory is 70-80% occupied. The corporate office shift to Kanjurmarg aims to facilitate further expansion at the Saravali facility. Monga Strayfield's plants are operating at 85-90% utilization.

Future Growth Avenues and Market Potential

Kilburn is exploring new technologies for EV battery recycling and RDF dryers for the cement market, which is a ₹5,000 crore industry for waste heat recovery. The combined addressable market for Kilburn and its subsidiaries (including RF dryers at ₹300-₹400 crores and sheet metal fabrication) is significantly larger than its current operations, offering substantial long-term growth potential.

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