MOLDTECH - Mold-Tek Technologies Ltd Share Price

Mold-Tek Technologies Limited's management, led by Chairman and Managing Director Mr. Lakshmana Rao, provided a positive outlook during the Q4 FY26 earnings conference call held on May 14, 2026. The company reported a turnaround in its financial performance, achieving a profit of INR 2.28 crores in Q4, compared to a loss of INR 1.6 crores in the same quarter last year. Despite facing a substantial MTM loss of INR 4 crores due to rupee depreciation, overall profitability for the fiscal year stood at INR 10 crores, although this marked a 17% decline from the previous year's PAT of INR 12.16 crores.

Key forward-looking points from management included:

1. Revenue Growth: The management expressed confidence in achieving a top line of around INR 250 crores for FY27, attributing this target to both organic growth and contributions from the recently acquired Beryl company, which is expected to add approximately INR 25 crores.
2. EBITDA Improvement: The management anticipated an EBITDA margin increase from the current 11% to 15% in the upcoming financial year, driven by enhanced productivity and operational efficiency.
3. Structural Engineering Growth: The transition to structural design services is expected to grow significantly, with a target for design revenues to reach 30%-40% of overall revenues in 3-4 years.
4. Cost Management: The effective downsizing of the MES team, reducing from 160 to 60 employees, is projected to eliminate losses previously associated with the automobile sector, which had resulted in over INR 7 crores in losses last year.
5. Work on Hand: Civil work orders have shown a substantial increase from $2.5 million to about $5 million, indicating a healthy backlog of projects that will drive growth.

Overall, Mold-Tek Technologies is optimistic about its recovery trajectory, bolstered by strategic acquisitions, a focus on high-value engineering services, and improved operational management.

Q1: Could you explain the evolution of how the service has changed over the last 15 years?

I'd be glad to explain. Until 2010, we primarily provided engineering services for Pre-Engineering Metal Buildings, which was lower-end. Post-acquisitions of RMM and Crossroads, we shifted to structural steel detailing for high-rise and industrial buildings, now making up 90% of our revenue. Mechanical Engineering Services started a decade ago and included automobile work, but we've downsized that sector due to reduced demand. Our recent acquisition of Beryl enhanced our service offerings, especially in residential designs.

Q2: Can you clarify the difference between structural design and detailing?

Structural designing involves ensuring the safety and integrity of a building's structure, calculating loads and member dimensions, whereas detailing translates those designs into fabrication drawings for construction. Detailing is less complex and lower in value addition, while designing requires higher expertise and commands better fees. Our aim is to shift more towards design services, currently making up just about 10% of our civil services.

Q3: How has the pitching and sales team changed to a different customer?

For detailing services, we primarily approach fabricators, but for designing, architects and builders are our main contacts. We maintain communication with the Engineer of Record (EOR) to clarify any doubts during detailing. Transitioning to designing services required us to build relationships with architects and contractors to widen our service range, thus expanding our market reach.

Q4: What is the expectation for future splits between structural design and detailing revenues?

Currently, structural design is around 8%-10% of our civil service revenues. Over the next 3-4 years, I hope to see design services grow significantly, ideally reaching 30%-40% as we enhance our capabilities and strengthen client relationships in that segment. Integrating designing with detailing into bundled services also supports this growth.

Q5: Can you provide an update regarding your plans for future acquisitions, particularly in structural engineering?

We successfully completed the acquisition of Beryl for residential design services, but we're still exploring further acquisitions in the high-rise structural engineering space. We expect that acquiring another design firm will accelerate our capacity expansion and market penetration. We'll also nurture our existing teams and continue building our design capabilities.

Q6: What are your projections for revenue and EBITDA in FY27?

For FY27, I estimate our revenue could reach around INR 250 crores due to organic growth and contributions from the Beryl acquisition. EBITDA margins are projected to improve from 11% to at least 15%, driven by enhanced operational efficiencies following recent workforce reductions.

Q7: What impact do you see from AI on the engineering services business?

AI's impact on our specific areas of design and detailing is minimal. Engineering design requires human expertise and precision that AI cannot fully replicate in the next 5-10 years. While AI might streamline some operations, it won't disrupt our fundamental service offerings. We plan to leverage any available AI tools to enhance service delivery but remain focused on our core expertise in engineering solutions.

Q8: Can you elaborate on the potential from the newly entered MSA agreement?

Our recent MSA agreement with Danieli Corus for Mechanical Engineering Services commits us to providing manpower support over 1-3 years. While the immediate revenue potential isn't huge, it may grow to around $0.5 million annually, with ongoing efforts to enhance profitability through our existing capabilities and support services.

Q9: How have your receivables and cancellations of preferential shares affected your operations?

Increased receivables have been due to a significant revenue increase in Q4, and we're strategically managing them. The cancellation of the preferential shares was a decision made due to a lack of investment confidence, but it won't impact our operational strategies or capabilities going forward.

Q10: How has the integration of Beryl been progressing, especially concerning staff retention?

Integration has been positive, with no employee resignations from Beryl, reinforcing our confident acquisition approach. We are actively integrating and training staff to enhance their capabilities, and we expect Beryl to contribute more significantly moving forward as we better leverage our combined strengths in design services.