Mtar Technologies Limited — Q2 FY26 earnings call

Call held 6 Nov 2025

Management summary

MTAR Technologies reported a moderated Q2 FY26 performance with a temporary dip in EBITDA margin, attributed to tariff negotiations and strategic inventory build-up for a strong second half. The company revised its FY26 revenue growth guidance upwards to 30-35% and expects to maintain an annual EBITDA margin of 21%. A robust order book, significant capacity expansions in clean energy, and anticipated large orders in the nuclear division underpin management's bullish outlook for accelerated growth in H2 FY26 and beyond.

Highlights

  • Q2 FY26 Revenue from operations stood at INR135.6 crores.

  • Q2 FY26 EBITDA margin was 12.5%, a temporary dip from Q1 FY26's 18.13%.

  • Q2 FY26 Profit after tax was INR4.2 crores.

  • Revised FY26 Revenue Guidance increased to 30-35% growth (from initial 25%).

  • FY26 Annual EBITDA Margin is predicted to remain around 21%.

  • Order Book at end Q2 FY26 was INR1,296 crores, growing to INR1,703 crores as of Nov 5, 2025.

  • Expected Closing Order Book for FY26 is close to INR2,800 crores.

  • Hotbox capacity is expanding from 8,000 to 20,000 units by March FY27 with planned capex of INR95-100 crores.

Key financials

2 periods

Headline

  • Revenue from Operations
    ₹135.6 Cr
    QoQ -13.4%
  • EBITDA
    ₹17 Cr
    QoQ -40.1%
  • EBITDA Margin
    12.5%
  • Profit Before Tax
    ₹5.7 Cr
    QoQ -61.5%
  • Profit After Tax
    ₹4.2 Cr
    QoQ -61.1%

end Q2 FY26

  • Order Book
    ₹1,296 Cr
    QoQ +39.4%

What they filed

Q1 FY27: revenue up 129.9%, net profit up 354.5% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue190 174 183 157 136 −28%278 +60%306 +67%361 +130%
EBITDA37 33 34 28 17 −54%64 +94%62 +82%85 +204%
Net profit19 16 14 11 5 −74%35 +119%44 +214%50 +355%
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.

Guidance & targets

Revenue

  • FY26 Revenue Growth Revenue · FY26 · High confidence 30-35%

    Previously 25% → 30-35%

    with a revised guidance of 30% to 35% increase in revenues for FY '26 compared to our initial guidance of 25%, which is driven by robust order inflows scheduled for execution within the fiscal year.

    — Srinivas Reddy, Managing Director and Promoter

  • Clean Energy Segment Revenue Revenue · H2 FY26 · High confidence approximately INR340 crores
    We expect a robust performance in the clean energy segment, which is the vertical itself in the second half of FY '26 with revenues of approximately INR340 crores anticipated during the period.

    — Srinivas Reddy, Managing Director and Promoter

  • Fluence Revenue Revenue · next 2-3 years · Medium confidence INR200-400 crores
    And then you look at probably around revenue growth of what you're looking at between INR200 crores to INR400 crores of revenue coming in over the next two, three years.

    — Srinivas Reddy, Managing Director and Promoter

  • Aerospace Business Revenue Revenue · next 4-5 years · High confidence about INR500 crores
    Absolutely. You got right on target that our goal also is over the next 4 to 5 years, the aerospace business should easily be touching about INR500 crores, yes.

    — Srinivas Reddy, Managing Director and Promoter

Margin

  • Annual EBITDA Margin Margin · FY26 · High confidence around 21%
    Our annual EBITDA margin is predicted to remain around 21%, in line with our initial guidance, supported by improved operating leverage and higher capacity utilization in H2.

    — Srinivas Reddy, Managing Director and Promoter

Order Book

  • Closing Order Book Order Book · end FY26 · High confidence close to INR2,800 crores
    expecting a closing order book of close to INR2,800 crores by end of the year, which is a substantial increase compared to last year, based on the additional orders coming in from clean energy segment, nuclear space, etcetera.

    — Srinivas Reddy, Managing Director and Promoter

Capacity

  • Hotbox Manufacturing Capacity Capacity · by March [FY26] · High confidence 12,000 units

    From 8,000 units today

    we have already planned the required expansion plans for the hotbox division from the existing 8,000 units to over 12,000 units by end of March

    — Srinivas Reddy, Managing Director and Promoter

  • Hotbox Manufacturing Capacity Capacity · by September next year [FY27] · High confidence 16,000 units

    From 12,000 units today

    further expansions are being planned for additional to go up to 16,000 units by September of next year

    — Srinivas Reddy, Managing Director and Promoter

  • Hotbox Manufacturing Capacity Capacity · by March next year [FY27] · High confidence 20,000 units

    From 16,000 units today

    by March of next year to go up to 20,000 units capacity for this particular division.

    — Srinivas Reddy, Managing Director and Promoter

Order Inflow

  • Nuclear Orders (Kaiga 5 & 6) Order Inflow · this month · High confidence approximately INR500 crores
    The much anticipated fleet reactive orders are expected to be received in the coming weeks, totalling to approximately around INR500 crores for Kaiga 5 and 6 where all the details have been finalized and the POs are expected anytime during this month itself.

    — Srinivas Reddy, Managing Director and Promoter

  • Nuclear Division Orders (Overall) Order Inflow · by end FY26 · High confidence about INR800 crores
    So we should end up close to about addition overall about INR800 crores of orders kicking in into the company by the end of the year in the Nuclear Division itself.

    — Srinivas Reddy, Managing Director and Promoter

Working Capital

  • Working Capital Days Working Capital · end FY26 · High confidence 220 days
    So we remain committed to improving this further and are targeting to 220 days by end other FY '26.

    — Gunneswara Rao, Chief Financial Officer

  • Working Capital Days Working Capital · next year · High confidence 200 days
    our long-term target is around 200 days next year and 180 days post couple of years from now.

    — Gunneswara Rao, Chief Financial Officer

  • Working Capital Days Working Capital · post couple of years · High confidence 180 days

    — Gunneswara Rao, Chief Financial Officer

Capex

  • Hotbox Expansion Capex (8k to 12k units) Capex · by March [FY26] · High confidence INR35-40 crores
    And that should be approximately around -- roughly around INR35 crores to INR40 crores. Already, the plan is to ensure that the expansion plan is completed by end of March.

    — Srinivas Reddy, Managing Director and Promoter

  • Hotbox Expansion Capex (12k to 20k units) Capex · by March FY27 · High confidence INR60 crores
    it should be close to about since we have the infrastructure in place, it should be close to about INR60 crores of capex, which might require to go up to 20,000 level, from 12,000 to 20,000.

    — Srinivas Reddy, Managing Director and Promoter

  • Total Capex Capex · FY26 and next financial year [FY27] · High confidence INR150+ crores
    No, INR150-plus crores is for this financial year and the next financial year.

    — Gunneswara Rao, Chief Financial Officer

  • Capex for Fuel Cells Capex · FY26 and next financial year [FY27] · High confidence INR40 crores
    Around INR40 crores for the fuel cells and INR90 crores for oil and gas.

    — Gunneswara Rao, Chief Financial Officer

  • Capex for Oil & Gas Capex · FY26 and next financial year [FY27] · High confidence INR90 crores

    — Gunneswara Rao, Chief Financial Officer

Debt

  • Long-term Debt Debt · current · High confidence around INR100 crores
    our long-term debt is around INR100 crores only.

    — Gunneswara Rao, Chief Financial Officer

  • Debt Repayment Debt · every year · High confidence INR46 crores
    And every year, we are repaying INR46 crores every year. So by next 2 years, existing debt will be zero.

    — Gunneswara Rao, Chief Financial Officer

  • Additional Debt Raise Debt · near future · High confidence INR150-200 crores
    So we are going to raise a debt of additional, say, maybe INR150 crores, INR200 crores to support the growth.

    — Gunneswara Rao, Chief Financial Officer

Project Timeline

  • Oil & Gas Plant Commissioning Project Timeline · FY27 · High confidence next year, second quarter onwards
    And also, I just want to highlight that we are setting up the oil and gas sector in a dedicated asset at facility, which is going to be commissioned in the next year, second quarter onwards.

    — Gunneswara Rao, Chief Financial Officer

  • Fluence Long-term Agreement Finalization Project Timeline · Q4 FY26 · Medium confidence sometime during Q4 FY26
    And once that is done, hopefully, I was talking to our team, and they said that we should be able to finalize the long-term agreement sometime during the year, mostly by Q4 of this year.

    — Srinivas Reddy, Managing Director and Promoter

  • Fluence Batch Production Start Project Timeline · H2 FY27 · High confidence H2 FY27
    And to begin with, then we had established the required facilities for them and we're looking at second half of next year to solely start the batch production.

    — Srinivas Reddy, Managing Director and Promoter

  • AMCA EOI Shortlisting Announcement Project Timeline · next 2 months · High confidence coming couple of months
    So coming to the time lines, like they might announce who got shortlisted in the EOI in the coming couple of months

    — Srilekha Jasthi, Head Strategy and Investor Relations

  • AMCA Bid Participation Project Timeline · next 3 months · High confidence around three months
    post that we need to participate in the bid, which will take around three months-or-so.

    — Srilekha Jasthi, Head Strategy and Investor Relations

  • AMCA Bid Winner Announcement Project Timeline · May 2026 · Medium confidence May 2026
    By May 2026, hopefully, they'll be announcing who has won the bid.

    — Srilekha Jasthi, Head Strategy and Investor Relations

  • AMCA JV Formation & 5 Prototype Order Project Timeline · within 3 months of bid winner announcement · High confidence within three months
    And then within three months, they need to form a JV and they need to take up that 5 prototype order.

    — Srilekha Jasthi, Head Strategy and Investor Relations

  • AMCA First Prototype Rollout Project Timeline · end of 2028 · High confidence end of 2028-or-so
    Government of India is planning to roll out first prototype probably by end of 2028-or-so.

    — Srilekha Jasthi, Head Strategy and Investor Relations

  • Semi-Cryo Engine First Hardware Project Timeline · beginning of FY27 · High confidence beginning of next year
    So in all probability, beginning of next year, we should be able to report the first hardware of semi-cryo.

    — Srinivas Reddy, Managing Director and Promoter

Risks & concerns

  • Temporary dip in EBITDA in Q2

    medium

    While there is a temporary dip in EBITDA in this quarter, this is a short-term phenomenon, and we expect a strong performance in the second half of FY '26.

    Management acknowledged

  • Elevated working capital days

    medium

    Working capital days are currently elevated due to higher inventory levels built to support purely the expected growth in Q3 and Q4 which is almost 2x of sales compared to the first half. Company targets reduction to 220 days by FY26 end.

    Management acknowledged

  • Tariff hurdles affecting margins

    low

    Management stated they successfully negotiated tariffs without affecting their bottom line, as their BOM costs are a small percentage of Bloom's overall picture.

    Analyst downplayed

Areas of evasion (1)

  • Peak revenue potential from hotbox capacity

Q&A highlights

3 direct
Hotbox capacity expansion capex and assembly in India Direct
See, basically, initially from 8,000 to 12,000 we are doing in our existing plants, which will be commissioned by March. And that should be approximately around -- roughly around INR35 crores to INR40 crores. Already, the plan is to ensure that the expansion plan is completed by end of March.

Provides concrete capex figures and timelines for a key growth driver, and clarifies the long-term strategy for local assembly.

Asked by Sandeep Tulsiyan

Nuclear orders capacity and AMCA project details Direct
Yes. We have the capacity to handle the whatever orders we are anticipating around INR800 crores from both refurbishment and Mega engineering. So we have a capacity only bottlenecks we have to address, which is not going to be more than INR20 crores- INR30 crores.

Confirms execution capability for significant nuclear orders and gives a clear roadmap for the strategic AMCA defense project.

Asked by Viraj Parekh

Q2 margin decline and working capital management Direct
No. There is not. See, we are really not concerned about Q2. The reason being that there are a number of factors. One is uh there has been a prolonged discussion on the tariffs with our customers during the quarter.

Addresses investor concerns about the Q2 performance dip and provides reassurance on full-year profitability and cash flow management.

Asked by Meet Jain

3 min read 7 chapters

Detailed narrative

Q2 FY26 Performance Overview

MTAR Technologies reported a moderated Q2 FY26 performance with revenues from operations at INR135.6 crores, a sequential decline from Q1 FY26's INR156.6 crores. EBITDA for the quarter stood at INR17 crores, resulting in an EBITDA margin of 12.5%, down from 18.13% in the previous quarter. Profit after tax was INR4.2 crores, compared to INR10.8 crores in Q1 FY26. Management attributed this temporary dip to prolonged tariff discussions with customers and a strategic build-up of inventory to support an expected strong second half.

Robust Order Inflow & Book

The company demonstrated significant order book growth, closing Q2 FY26 with INR1,296 crores, up from INR930 crores at the end of Q1 FY26. Post Q2, MTAR received additional orders worth INR480 crores, bringing the total order book to INR1,703 crores as of November 5, 2025. Management is highly confident in achieving a closing order book of close to INR2,800 crores by the end of FY26, driven by substantial inflows from the clean energy and nuclear segments.

Clean Energy & Hotbox Capacity Expansion

The clean energy segment is expected to deliver robust performance, with approximately INR340 crores in revenues anticipated in H2 FY26. To meet the surging demand, MTAR is undertaking a multi-phase expansion of its hotbox manufacturing capacity. The capacity will increase from the existing 8,000 units to 12,000 units by March FY26 (capex of INR35-40 crores), then to 16,000 units by September FY27, and finally to 20,000 units by March FY27 (additional capex of INR60 crores for the 12k to 20k expansion).

Nuclear Division Growth & Pipeline

The nuclear division is poised for significant growth, with approximately INR500 crores in orders for Kaiga 5 and 6 expected in November 2025. Including orders from refurbishment reactors, the company anticipates receiving about INR800 crores in total orders for the nuclear division by the end of FY26. Management confirmed that existing capacities can handle these orders with minimal additional capex of INR20-30 crores, with execution timelines ranging from 1 to 3.5 years for various packages.

Working Capital & Capex Strategy

Working capital days are currently elevated due to higher inventory levels built to support the expected doubling of sales in H2 FY26 compared to H1. MTAR aims to reduce working capital days to 220 by the end of FY26, further targeting 200 days next year and 180 days in the subsequent years. Total capex for FY26 and FY27 is projected to be over INR150 crores, with INR40 crores allocated for fuel cells and INR90 crores for oil & gas. The company plans to raise INR150-200 crores in additional debt to support growth, while existing long-term debt of INR100 crores is expected to be fully repaid within two years.

Aerospace & Defense Outlook

The Aerospace and Defense segment continues its strategic growth, engaging in key programs with leading MNC customers and domestic entities. While the current fiscal year is expected to see approximately INR100 crores less in orders, substantial growth is anticipated in coming years as first articles are completed and volume production commences. Management projects the aerospace business to reach about INR500 crores in revenue over the next 4-5 years. The company has also participated in the Expression of Interest for the AMCA project with Adani Aerospace, with the first prototype rollout planned for end of 2028.

New Growth Avenues: Oil & Gas and Fluence

The new oil and gas plant is expected to become operational by Q2 FY27, contributing to volume production. For Fluence, the battery storage program, MTAR aims to finalize a long-term agreement by Q4 FY26, with batch production commencing in H2 FY27. This partnership is projected to generate INR200-400 crores in revenue over the next 2-3 years. Additionally, the company is progressing on the semi-cryo engine, with the first hardware expected to be reported by the beginning of next year.

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