Detailed Narrative
Q4 FY26 and Full Year FY26 Performance Overview
Tega Industries reported a consolidated revenue of ₹1,773.6 crores for FY26, marking a 5% year-on-year growth. The adjusted EBITDA stood at ₹396.7 crores, achieving a 22% margin for the full year. The equipment business was a strong performer, growing 25% YoY to ₹268.8 crores, with its EBITDA margin improving from 12% to 13%. Gross margins for the group remained healthy at 60%.
Molycop Acquisition and Integration Strategy
The company successfully completed the acquisition of Molycop on June 1, 2026, in partnership with Apollo Funds, a move described as a transformational milestone. The acquisition involved adding $838 million in debt at Molycop and ₹150 crores at the parent level for financing. A key priority is the successful integration of Molycop across key functions, with a focus on establishing streamlined processes and robust governance. Management aims to reduce the combined entity's debt leverage to 3x within 3-4 years, leveraging revenue synergies in Tega and cost synergies in Molycop.
Consumables Segment Performance and Outlook
The consumables business segment's revenue remained flat for FY26, and Q4 revenue saw a decline of ₹16.2 crores compared to the similar period last year. This was primarily attributed to logistical disruptions in March 2026, including Middle East disturbances and container availability, which led to an increase in finished goods inventory. Despite this, management reiterated its long-term CAGR guidance of 15% for the consumables segment, expecting normalization of operations and execution of delayed orders in Q1 and Q2 FY27.
Robust Order Book and Future Visibility
As of March 31, 2026, the company's order book stands at ₹1,206 crores, with ₹906 crores executable within the next 12 months. This represents an 18% year-on-year increase in pending orders. Significant order bookings were recorded during February and March, providing strong visibility and confidence in the company's growth trajectory, especially given the robust demand outlook for gold and copper.
Capex Plans and Funding Strategy
For FY27, Tega plans to complete the Chile capex of $25-30 million (₹200-250 crores) and incur $20 million (₹160-170 crores) for Molycop's maintenance capex, in addition to Tega's annual sustaining capex of ₹5-6 crores. Tega's sustaining capex is funded by internal accruals, while Chile capex is funded through internal accruals and existing borrowing. Molycop's capex is expected to be managed from its own cash flows, without requiring new borrowing.
Chile Plant Commissioning Update
Construction of the Chile plant is progressing as per plan, with 50-60% of the civil work completed. The company expects to commission the plant by early Q3 FY27. However, commercial production and subsequent revenue booking will depend on obtaining necessary regulatory approvals, which might push revenue recognition to the end of Q4 FY27 or next year.
Working Capital Management
The company reported an improvement in its working capital cycle in FY26, primarily driven by better collections and a reduction in debtor days. Management stated that they aim to maintain a stable Days Sales Outstanding (DSO) of 100-105 days going forward⏳, reflecting efficient management of receivables.