SETL

Standard Engineering Technology Limited achieved its best year in company history in FY26, with broad-based improvements across all key metrics. Total income for FY26 reached ₹793 crores, marking a 26.7% year-on-year growth. Profit after tax (PAT) grew 21% to ₹83 crores, with a PAT margin of 10.5%. Q4 FY26 also demonstrated strong growth, with total income at ₹231 crores (up 35%) and PAT at ₹21 crores (up 27.8%). Operating cash flows were positive at ₹45 crores for the full year, and working capital days improved from 174 to 150 days.

The company has completed its transformation from a glass-lined equipment manufacturer to a fully integrated precision engineering and turnkey solutions company. This includes offering end-to-end services from concept and detailed design to fabrication, automation, installation, and commissioning. Acquisitions of Scigenics and Standard C2C Engineering during the year have been fully integrated, enhancing capabilities in bioprocess, fermentation systems, and in-house engineering for process, civil, HVAC, electrical, and instrumentation.

SETL highlighted key technology milestones, including the successful development and commercial validation of shell and tube glass-lined heat exchangers in partnership with GL HAKKO, Japan. Over 200 units are in the order book, with 100 already successfully delivered. These products are being chosen over graphite and alloy alternatives due to superior safety, reliability, and life-cycle performance. The company's conductivity glass-lining reactors are also progressing well, with multiple units manufactured, supplied, and validated.

To support future growth, SETL is undertaking significant capacity expansion. The company invested ₹40 crores in FY26 and plans to invest ₹130 crores over the next two years in a 36-acre greenfield project. This new facility, along with modernization of existing plants, is expected to increase total manufacturing capacity to ₹4,000 crores (₹2,000 crores from existing and ₹2,000 crores from the new facility). The first phase of the greenfield project is targeted to be 50% operational by April 1, 2027, with full completion by April 1, 2028.

Management expressed confidence in continued strong growth for FY27, expecting revenue and profitability to improve further. The company is expanding into new sectors such as oil and gas, nuclear engineering (targeting entry by FY28), food and beverages, and advanced process industries. International business is growing, with global partners like IPP showing interest in distributing new products. Structural tailwinds from India's CDMO expansion and global supply chain diversification are expected to drive demand for integrated engineering solutions.

The Board approved the re-designation of Mr. Yasuyuki Ikeda from Non-Executive to Executive Director, who will lead global operations and marketing to accelerate international reach. Additionally, Mr. Kancherla Uma Maheswara Rao was appointed as a new Independent Director, bringing over 38 years of experience in precision engineering and industrial manufacturing, enhancing governance depth at the board level.

Q4 margins experienced some pressure due to increased commodity prices and strategic investments in manpower for future growth. However, management expects margins to improve in FY27 through operational leverage, tighter procurement, and efficiency improvements as revenue volumes grow. Working capital days improved from 174 to 150 in FY26, and management aims to maintain it around 170 days, acknowledging the inherent capital intensity of their business model.