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    Krishca Strapp.

    KRISHCA
    Capital Goods·28 Nov 2025
    Management Summary

    Krishca Strapping Solutions reported strong H1 FY26 results with significant revenue and EBITDA growth, driven by disciplined operations and strategic capital deployment. The company is progressing with its cold rolling mill and new Vajra Alloys subsidiary, aiming for a shift towards technology-driven packaging solutions and specialty steel. While the order book remains healthy, export performance faced headwinds due to pricing pressure, and the company is focused on improving its working capital cycle.

    Highlights

    5

    • Standalone total income for H1 FY26 reached 92.7 crores, marking 45% year-on-year growth.

    • EBITDA expanded almost 58% year-on-year to 15 crores, and PAT improved to 6.18 crores.

    • Current order book is over 180 crore with execution timelines between 1 to 5 years, including a confirmed packing contract order worth 75 crore for the next financial year.

    • The cold rolling complex in Chennai is approaching commissioning, expected to fundamentally expand scale capability and addressable market.

    • Board approval for Vajra Alloys, a new subsidiary focused on Super Alloys and high-performance materials, marking an entry into premium material segments.

    Concerns

    3

    • Exports declined in H1 FY26 to 8.8 crores from over 20 crores in the previous year, primarily due to margin pressure and Chinese penetration in the Middle East.

    • The working capital cycle is currently long at 120 days, with a target to reduce it to less than 45 days over the next three years.

    • Shift to shorter-term contracts (1-year vs. 5-year) introduces volatility and is subject to current steel price fluctuations.

    Key financials

    Single quarter

    05 metrics
    1. 01Total Income₹92.7 Cr+45%YoY
    2. 02EBITDA₹15 Cr+58.0%YoY
    3. 03PAT₹6.18 Cr
    4. 04EBITDA Margin16%
    5. 05PAT Margin7%

    Segment breakdown

    • Domestic Revenue₹84 Cr47.8%
    • Export Revenue₹8.8 Cr5.0%
    • Packing Contract Revenue₹30 Cr17.1%
    • Direct Supply (Strapping & Primary Packaging)₹53 Cr30.1%
    Donut· Share of Revenue

    Order Book

    high confidence

    Total Value

    ₹ 180 crores

    as of 2025-09-30

    quantified

    Inflow this qtr

    ₹ 25 crores

    Execution

    execution timelines between 1 to 5 years

    Composition

    Mix2 client types
    • Vedanta (next FY expectation)₹ 35 crores63.6%
    • APL & other big packing contracts (individual expectation)₹ 20 crores36.4%

    Share of order book by client type (derived from disclosed amounts)

    Pipeline

    qualified rfp

    Orders in participation

    "The company has a healthy order book with multi-year contracts, and a strong pipeline, with a historical conversion rate of 20-30%."

    Source:
    Prepared remarks

    Capital allocation

    3
    medium confidence
    CategoryHeadline
    Capex

    Capex disclosed

    Cold Rolling Mill funded by internal accruals; Vajra Alloys funded by a mix of debt and limited strategy fundraise.

    Debt

    Debt disclosed

    Liquidity

    Liquidity disclosed

    Positive cash flow is expected from the second half of next year, despite potential negative free cash flow in the peak CapEx period of the first two quarters of next year.

    Guidance & targets

    9
    CategoryTargetPriority
    Revenue
    Revenue Growth
    minimum 25%
    		High
    Revenue
    Steel Vertical Revenue Growth
    40-45%
    		High
    Revenue
    Additional Revenue from Cold Rolling Mill
    150-200 crores
    		High
    Revenue
    Desiccant Sales
    20-25 crores
    		Medium
    Capacity
    Cold Rolling Mill Capacity Utilization
    20%
    		High
    Capacity
    Cold Rolling Mill Capacity Utilization
    50%
    		High
    Profitability
    Sustainable EBITDA Margin
    13-15%
    		High
    Profitability
    Export EBITDA Margin
    10-12%
    		High
    Working Capital
    Receivable Days
    <45 days
    		High

    Cold Rolling Mill Production Start and Revenue Contribution

    next quarter
    CurrentApproaching commissioning, production starting end of May
    TargetConfirmation of production start and initial revenue contribution

    Why it matters

    The CRM is a key growth driver, and its operationalization and revenue generation are crucial for achieving FY27 targets.

    We are starting the production maybe from end of May based on the current timelines. So certainly we are expecting over minimum 150 crore additional revenue from the CRM in a best-case scenario even we can do 200 crore plus also.

    How to verify

    key_financials.metrics[label='Total Income']

    Risks & concerns

    4
    RiskSeverity

    Equity Dilution

    Analyst raised concern about potential equity dilution for capex, but management stated no further significant dilution is expected, and internal accruals will fund future capex. — Analyst downplayed

    low

    Volatility of Short-Term Contracts

    Management acknowledged that short-term orders are volatile and subject to current steel price fluctuations, unlike more stable long-term contracts. — Analyst acknowledged

    medium

    Export Market Competition and Pricing Pressure

    Exports declined in H1 due to margin pressure from Chinese penetration and higher Indian steel prices compared to international markets, making it difficult to compete on volume. — Management acknowledged

    high

    Long Working Capital Cycle

    Current receivable days are 120, which management aims to reduce to less than 45 days over the next three years. — Management acknowledged

    medium

    Q&A highlights

    7

    “I understand your concern. We don't expect or foresee any further equity dilution in the near future and we are very confident that the revenue what we're expecting from the new cold rolling mill and the internal accurals from the project will be enough to, you know, provide enough capital for our upcoming Capex plan and we wanted to avoid any further dilution and at the same time, we're open to you know if any good opportunity comes up.”

    Addresses investor concern about potential equity dilution to fund significant capex, with management assuring no further dilution and self-funding through internal accruals and CRM revenue.

    asked by Rishabh Tripathi

    3 min read8 chapters

    Detailed Narrative

    01

    H1 FY26 Performance Highlights

    Krishca Strapping Solutions Limited delivered a strong H1 FY26, with standalone total income reaching 92.7 crores, marking a 45% year-on-year growth. EBITDA expanded by 58% year-on-year to 15 crores, and PAT improved to 6.18 crores. The company's H1 EBITDA margin stood at 16%, with a PAT margin of approximately 7%.

    02

    Strategic Shift Towards Technology-Driven Solutions and Specialty Steel

    The company is undergoing a strategic transition from a high-quality product manufacturer to a full-scale technology-driven packaging solutions company, with a strong focus on specialty steel. This shift is underpinned by the commissioning of a cold rolling complex and the establishment of a new subsidiary, Vajra Alloys, for super alloys. Management aims for a much higher revenue growth of 40-45% year-on-year in the steel vertical over the next 5 years.

    03

    Cold Rolling Mill Project and Capacity Expansion

    The cold rolling complex in Chennai, a project with over 100 crore capex, is nearing commissioning, with production expected to start by the end of May. This facility will manufacture thin precision gauge stainless steel and high carbon strips. It is projected to contribute an additional 150-200 crores in revenue in FY27, with capacity utilization targeted at 20% in FY27 and 50% in FY28.

    04

    Vajra Alloys: Entry into Super Alloys

    Krishca has approved the establishment of Vajra Alloys, a new subsidiary with a 7 crore investment, to focus on Super Alloys and high-performance materials. This strategic move aims to capture a 1000 Cr+ market, initially targeting commercial and industrial applications before expanding into defense and aerospace segments. The project is progressing with commissioning phases expected in the coming months.

    05

    Packaging Contract Business and Order Book

    The packaging contract business continues to scale impressively, contributing approximately 30 crores to H1 domestic revenue. The current order book stands at over 180 crore, executable over 1 to 5 years, with a confirmed 75 crore packing contract order for the next financial year. The company is also participating in bids worth 150 crore, with a historical conversion rate of 20-30%.

    06

    Working Capital Management and Efficiency

    The company is actively focusing on improving its working capital cycle, which currently stands at 120 receivable days. The target is to reduce this significantly to less than 45 days over the next three years. The new cold rolling mill, operating on a cash-and-carry model, is expected to contribute to this improvement by freeing up 6-7 crores of inventory.

    07

    Export Market Challenges and Outlook

    Export revenue declined in H1 FY26 to 8.8 crores from over 20 crores in the previous year, primarily due to intense pricing pressure from Chinese competitors and higher Indian steel prices. Management maintains a cautious outlook for aggressive expansion in this region in the short term, expecting organic growth of 15-20% year-on-year and an EBITDA margin of 10-12% for exports.

    08

    PLI Scheme and Desiccant Manufacturing

    Krishca plans to apply for the Production Linked Incentive (PLI) scheme for its cold rolling mill, as it aligns with the scheme's criteria for specialty steel. The company is also evaluating applying for the Superalloys segment. Additionally, a 2 crore investment in a desiccant manufacturing plant is underway, with expected sales of 20-25 crores by the third or fourth year.

    This is an AI-generated summary of a publicly available earnings call transcript. It is for informational purposes only and does not constitute investment advice, a recommendation, or an endorsement. inve.money is not a SEBI-registered investment advisor. Please consult a qualified financial advisor before making any investment decisions.