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    Manaksia Coated

    MANAKCOAT
    Capital Goods·5 Nov 2025
    Management Summary

    Manaksia Coated Metals & Industries Limited reported a strong Q2 FY26 with significant growth across key financial metrics, driven by robust demand, improved realizations, and a strong export performance. The company's focus on value-added products and operational efficiency led to substantial margin expansion. Balance sheet health also improved with reduced debt and better ratios, supported by recent equity infusions and ongoing strategic capacity expansion projects.

    Highlights

    5
    • Q2 FY26 total income grew by 27% YoY to ₹224 crores, driven by strong demand and improved realizations.

    • EBITDA more than doubled to ₹29 crores, reflecting 113% growth, with EBITDA margin expanding by 534 bps to 13%.

    • Net profit surged by 491% YoY to ₹14 crores, translating into a net margin of 6%.

    • Exports remained a key growth driver, contributing 85% of total sales with export revenue up 151% YoY and tonnage at a record 20,590 metric tons.

    • Debt-equity ratio improved to 1.19 (down from 1.81 at FY25 end), and total debt declined by 27% to ₹103.22 crores as of September 30, 2025.

    What Changed2

    vs Q3 FY26

    Guidance items6 → 9 (+3)Risks discussed2 → 1 (-1)
    Key financials

    Metrics

    19

    Periods

    3

    Headline

    3
    • Interest Coverage Ratio
      3.62
    • Current Ratio
      1.67
    • Debt-Equity Ratio
      1.19

    Q2 FY26

    11
    • Total Income
      ₹224 Cr
      YoY+27%
    • EBITDA
      ₹29 Cr
      YoY+113.0%
    • EBITDA Margin
      13%
    • Net Profit
      ₹14 Cr
      YoY+4.9%
    • EPS
      ₹1.43
      YoY+3.5%

    H1 FY26

    5
    • Total Income
      ₹478 Cr
      YoY+27%
    • EBITDA
      ₹58 Cr
      YoY+103%
    • EBITDA Margin
      12%
    • Net Profit
      ₹28 Cr
      YoY+4.2%
    • EPS
      ₹2.81
      YoY+2.9%

    Order Book

    high confidence

    Total Value

    ₹ 600 crores

    as of 2025-09-30

    quantified
    33.3% QoQ

    Inflow this qtr

    ₹ 370 crores

    Execution

    The existing order book currently is having a timeline of 12 months for execution.

    "The order book has grown to Rs. 600 crores, driven by new export orders and domestic market demand, with a 12-month execution timeline."

    Source:
    Q&A

    Capital allocation

    2
    high confidence
    CategoryHeadline
    Capex

    Capex disclosed

    partially through recent equity infusion

    Debt

    Gross ₹103.22 crores · 1.2x EBITDA

    Guidance & targets

    9
    CategoryTargetPriority
    Capacity
    Alu-zinc coating line capacity
    1,80,000 tons per annum
    High
    Capacity
    Second color coating line capacity
    2,36,000 tons per annum
    High
    Capacity
    Alu-zinc capacity expansion (Phase 3)
    3,60,000 tons
    Medium
    Revenue
    Alu-zinc coating line revenue generation
    start revenue generation
    High
    Revenue
    Second color coating line revenue generation
    start generating revenue
    High
    Energy Cost Savings
    Captive solar power plant offset of grid power dependency
    50-55%
    High
    Energy Cost Savings
    Captive solar power plant output
    start giving its output
    High
    Project Timeline
    Phase 3 expansion (second alu-zinc line and cold rolling complex)
    happening in FY '28
    Medium
    Export Contribution
    Export revenue percentage
    upwards of 50%
    High

    Alu-zinc line commissioning and revenue generation

    FY26
    CurrentScheduled for current fiscal 2025
    TargetStart revenue generation

    Why it matters

    This project is expected to enhance capacity by 36% and contribute to value-added product mix, impacting future revenue and margins.

    The aluminum zinc coating line conversion scheduled for current fiscal 2025, which we believe will enhance capacity by 36% up to 1,80,000 tons per annum, and positions us among the few players in India with 100% aluminum zinc capability. The first one is the alu-zinc project which is scheduled to start revenue generation within the current fiscal of FY '26

    How to verify

    guidance_and_targets[category='Revenue'][metric='Alu-zinc coating line revenue generation']

    Risks & concerns

    1
    RiskSeverity

    Commodity price volatility

    Management acknowledges correlation to metal prices but mitigates risk with a largely back-to-back business model (80%+).Management acknowledged

    medium

    Q&A highlights

    8

    “Our business model is largely a back-to-back model where we are not having an exposure to the commodity price risk since more than 80% of our business is back-to-back, and spot changes in the market of commodity does not impact our inventory or our business model. So, our strong focus on exports and OEM business has led to this situation and we would like to continue this focus and strategy to be a dominant player and a strong player in the OEM segment and the export segment which really creates a strong identity and value for our company, for our product and for our customers.”

    Analyst questioned how the company plans to build a strong identity beyond being part of the commodity cycle, and management explained their strategy of value-added products, back-to-back model, and export/OEM focus.

    asked by Sucrit Patil

    3 min read6 chapters

    Detailed Narrative

    01

    Strong Financial Performance in Q2 and H1 FY26

    Manaksia Coated Metals & Industries Limited delivered a robust Q2 FY26, with consolidated total income growing by 27% year-on-year to ₹224 crores. This growth was driven by strong demand and improved realizations. EBITDA more than doubled to ₹29 crores, marking a 113% increase, and the EBITDA margin expanded significantly by 534 basis points to 13%. Net profit surged by 491% year-on-year to ₹14 crores, resulting in a net margin of 6%, while EPS increased by 347% to ₹1.43. The first half of FY26 also showed strong performance, with total income at ₹478 crores (up 27% YoY) and EBITDA at ₹58 crores (up 103% YoY).

    02

    Strategic Shift Towards Value-Added Products and Exports

    The company is intentionally shifting its product mix towards higher value-added segments, particularly pre-painted steel, which contributed 92% of total sales in Q2 FY26. This focus on pre-painted steel, which offers a higher EBITDA margin per ton, is a key driver of profitability. Exports played a crucial role, contributing 85% of total sales in Q2 FY26, with export revenue growing by 151% year-on-year and export tonnage reaching a record 20,590 metric tons. Management aims to maintain export contribution upwards of 50% for the current fiscal year, selling largely to end-users (OEMs) across 43 countries.

    03

    Balance Sheet Strengthening and Debt Reduction

    The balance sheet showed significant improvement during H1 FY26. The interest coverage ratio improved to 3.62 from 1.89 as of March 31, 2025, reflecting higher profitability and lower finance costs. The current ratio increased to 1.67 from 1.35, and the debt-equity ratio improved to 1.19, down from 1.81 at the end of FY25. Total debt declined by 27% from ₹141.28 crores to ₹103.22 crores as of September 30, 2025, primarily due to repayment and strong cash generation.

    04

    Ongoing Capacity Expansion and Future Growth Plans

    Manaksia Coated Metals is progressing with multiple strategic projects. The aluminum zinc coating line conversion, scheduled for the current fiscal year (FY26), is expected to enhance capacity by 36% to 1,80,000 tons per annum and begin revenue generation within FY26. A second color coating line, expected to commission by early FY27, will expand coating capacity by 174% to 2,36,000 tons. Additionally, a 7-megawatt peak captive solar power plant, also targeted for early FY27, aims to offset 50-55% of grid power dependency and generate significant energy cost savings. Phase 3 expansion, including a second alu-zinc line and a cold rolling steel complex, is in the blueprint stage for FY28.

    05

    Equity Infusion and Capital Utilization

    The company successfully raised ₹174.87 crores through two preferential allotments. Of this, ₹80.36 crores were collected in H1 FY26 (₹74.60 crores in Q1 and ₹5.76 crores in Q2), with a balance of ₹13.65 crores pending conversion. The proceeds from the recent fundraise of ₹134.55 crores (₹120 crores realized) are being utilized for debt reduction, higher working capital requirements, and CAPEX projects for the alu-zinc line and the second color coating line. Management is continuously evaluating options for future fundraisers to support its growth ambitions, particularly for horizontal expansion of alu-zinc capacity and backward integration.

    06

    Operational Efficiency and Margin Drivers

    The improvement in gross margins, from 20% to approximately 31%, is attributed to several factors. Higher capacity utilization led to a reduction in fixed costs per ton. A strategic shift from commoditized segments to more niche and customized end-uses, such as HVAC, refrigeration, and home appliances, contributed to better price realizations and margin profiles. Furthermore, the significant growth in exports, which accounted for 85% of sales in Q2 FY26, was a key contributor to the enhanced margins. The company's back-to-back business model for 75-80% of volumes helps mitigate raw material price volatility, with changes passed on to spot market customers every 15 days.

    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.