Uravi Defence and Technology Limited — Investor Meet, 26-11-2024: Analysts/Institutional Investor Meet/Con. Call Updates

**Financial Performance:** Uravi Defence and Technology Limited reported total income of INR 11.19 crore for Q2 FY25, with an EBITDA of INR 1.56 crore, resulting in an EBITDA margin of 13.95%. The net profit for the quarter was INR 0.35 crore, translating to a net profit margin of 3.09% and EPS of INR 0.30. For the first half of FY25, total income was INR 22.49 crore, with an EBITDA of INR 3.36 crore and an improved EBITDA margin of 14.95%. Net profit for H1 stood at INR 0.79 crore, reflecting a net profit margin of 3.52%.

**Future Outlook and Growth Drivers:** Management aims to achieve a 10% revenue increase in FY25 by strengthening relationships with existing customers, acquiring new OEM clients, and developing new products, particularly in the LED and EV segments. They also plan to enhance their market presence in South America and focus on diversification in the defense sector through acquisitions.

**Order Book and Operational Updates:** The acquisition of SKL (India) Pvt. Ltd. is expected to generate INR 15 to 22 crore in revenue by 2025. The order from L&T for power supply systems for 200 defense guns worth INR 26 crore is a significant contribution to their order book.

**Analyst Q&A Insights:** Questions raised concerned net profit margins, with management indicating ongoing cost reduction measures will lead to improved margins by year-end. Analysts inquired about revenue breakdowns, revealing OEM sales dominate at 95%, with only 2.75% from aftermarket and minor exports. Concerns regarding defense market positioning emphasized that SKL's integration is planned carefully, targeting revenue growth through strategic relationships with major companies.

**Market or Regulatory Updates:** While no regulatory changes were highlighted, management discussed leveraging government incentives in defense and green energy.

**Strategic Focus Areas:** The management emphasized innovation, operational efficiency, and customer relationship management as key strategies while exploring expansion in LED and EV markets, indicating a trend toward technological partnerships and product diversification.

**Investor Insight:** With improving financials, strategic growth initiatives, and expansion into high-demand sectors, the company's outlook suggests a favorable position, aligning with a ‘buy’ perspective as strong growth potential is anticipated, particularly in the defense market.