Detailed Narrative
Strong Financial Performance and Ambitious Growth Outlook
Kilburn Engineering reported its highest-ever standalone revenue of ₹335 crores for the full year FY25 and ₹102 crores for Q4 FY25. On a consolidated basis, the company achieved a top line of ₹425 crores with an EBITDA of ₹100 crores, resulting in a 23.53% EBITDA margin. Management has set an ambitious target of 50% CAGR for revenue in FY26, aiming for ₹675-700 crores, and projects a 25-30% CAGR for subsequent years, signaling strong confidence in its growth trajectory.
Robust Order Book and Expanding Inquiry Pipeline
The group concluded FY25 with a healthy order backlog of ₹483 crores. Kilburn's standalone order intake for the year was ₹493 crores, complemented by M.E. Energy's ₹83 crores. The consolidated inquiry pipeline has expanded to over ₹3,000 crores, up from ₹2,000 crores in FY24, with an expected conversion rate of 20-25%, which should translate to ₹600-700 crores in new order intake for FY26. Export orders currently constitute ₹160 crores of the existing backlog.
Strategic Acquisitions and Capacity Enhancements
The acquisition of Monga Strayfield was completed in January 2025, with its full-year revenue contribution expected to be ₹90-110 crores in FY26. M.E. Energy, acquired a year prior, recorded actual execution of ₹95 crores in FY25, despite intercompany adjustments. The Ambernath factory is now fully operational and is projected to add ₹100 crores to turnover in FY26. M.E. Energy's Phase 1 expansion is also complete, with Phase 2 anticipated to be operational by mid-H2, further boosting capacity.
Diversified Sector Focus and Margin Stability
Kilburn Engineering benefits from a diversified presence across multiple sectors, including nuclear, carbon black, fertilizers, petrochemicals, steel, chemical, and textiles (through Monga Strayfield). This diversification provides resilience against sector-specific slowdowns. The company aims to maintain consolidated EBITDA margins in the 20-22% range, with specific high-margin projects like the OCP Morocco order contributing positively to profitability in Q4 FY25.
Working Capital Dynamics and Cash Flow Management
Despite strong operational performance, CFFO for FY25 was negative ₹10 crores. This was primarily attributed to a buildup of debtors and unbilled revenue, with ₹30-40 crores of billing dispatched in March alone. The company is utilizing funds from a recent ₹200 crore share issuance (from warrants) and ICDs from subsidiaries to manage working capital and repay term loans. Management is actively working on improving working capital days by securing more advances and better credit terms from vendors.
Future Growth Avenues and International Expansion
The company sees significant growth potential in sectors like cement, where M.E. Energy is focusing on a market size of ₹4,000-5,000 crores. The pharma segment, initiated with a pilot order from Granules, is also a promising avenue pending successful customer trials. Kilburn is targeting to increase its export revenue contribution to 20-30% of total revenue within the next two to three years, leveraging its capabilities across all three entities in the global drying solutions market, estimated at $2-3 billion.