Mold-Tek Technologies Limited

Mold-Tek Technologies has entered into strategic Memorandums of Understanding (MOUs) with Interarch Building Solutions Limited and Affordable Robotic & Automation Limited. The Interarch partnership aims to market Mold-Tek's products and services in the US construction industry, covering design, detailing, supply, and erection, with Mold-Tek earning a commission on the overall building value. The Affordable Robotics MOU will leverage Mold-Tek's MES division to expand Affordable's robotic solutions into the US and European markets, providing Mold-Tek with additional design and detailing work. These initiatives are expected to enhance performance in coming quarters, though income streams may take a couple of quarters to materialize.

The civil engineering, designing, and drafting order book has shown a positive trend, increasing to USD 3.5 million as of June 1, 2025, from USD 1.7-1.8 million two quarters prior. This recovery follows a challenging Q3 and Q4 FY25, which were impacted by project holds due to US election campaigning. However, the take-off of new building projects under the Interarch MOU is currently delayed by confusion surrounding US tariffs on steel and steel buildings, despite initial offers being competitive. Management anticipates clarity on tariffs within one to two months.

The Body in White (BIW) robotics segment, which is a key contributor to MES revenues, has experienced slow growth. This slowdown is attributed to the stabilization of new automobile models, particularly EVs, leading to fewer comprehensive design assignments and more minor cosmetic changes. Consequently, MES revenues have been impacted. Management expects the MES segment to pick up from Q2 FY26 as the company explores new opportunities in special purpose missions' line of activity and leverages the Affordable Robotics MOU.

After operating below breakeven in Q4 FY25, Mold-Tek Technologies aims to return to profitability in Q1 FY26 and achieve overall profitability for FY26 similar to FY25, which recorded INR 16 crores PBT and INR 12 crores PAT. The company's employee utilization rate, which has been around 55-60% over the last six months, is targeted to improve to 75-80%. With a current employee strength of 1,000-1,069, the full utilization revenue potential is estimated at USD 25-30 million, highlighting the significant leverage from improved efficiency.

Mold-Tek has been actively seeking structural design acquisitions for the past 1-1.5 years to gain national coverage in the fragmented US market and expand its business. The primary challenge has been identifying suitable partners willing to commit for a long-term period of 3-5 years. Currently, the company is in negotiations with a potential client in New Jersey, aiming for a 5-year commitment. A successful first acquisition is considered crucial, as it would facilitate subsequent regional acquisitions at a rate of one or two per year.

Management expressed confidence in doubling sales within the next 3-4 years, contingent on the successful execution of the recently signed MOUs and the completion of structural design acquisitions. This growth trajectory is supported by a significant reduction in write-offs and bad debts, which have decreased from $200k-$300k three to four years ago to a current range of $20k-$25k. This improvement reflects enhanced operational quality and risk management within the company.