Azad Engineering Limited — PPTs, 23-05-2025: Investor Presentation

1. Financial Highlights:

Azad Engineering Limited has announced a board meeting to approve the financial results for the quarter and half-year. FY25 standalone revenue rose 32.9% to Rs. 4529.3 Mn, with adjusted EBITDA up 40.1% to Rs. 1645.7 Mn, margin expanding to 36.3%. PAT jumped 51.1% to Rs. 885.3 Mn, margin up 230 bps to 19.5%. Quarterly revenue grew 34.2% YoY to Rs. 1245.2 Mn; PAT surged 74.4% to Rs. 260.4 Mn. Non-current assets stand at Rs. 6635.2 Mn and total assets Rs. 18545.3 Mn. Borrowings rose but remain comfortably managed against equity of Rs. 14176 Mn, highlighting a solid balance sheet supporting growth.

2. Strategic Initiatives & Growth Drivers:

Azad is aggressively expanding capacity with two new lean manufacturing plants in Hyderabad adding 14,800 sq. mts. The company raised Rs. 700 Cr through a QIP, largely earmarked for machinery capex (~Rs. 525 Cr). Growth strategy focuses on wallet share expansion, broadening product offerings, and leveraging technology-driven efficiencies. Geographical expansion includes an MoU for a new facility in Saudi Arabia targeting local demand.

3. Business Developments:

Azad clinched a USD 112 Mn GE Vernova turbine components contract and strategic long-term deals with Baker Hughes, Mitsubishi Heavy Industries (USD 83 Mn over 5 years), and Rolls Royce. Collaboration with DRDO’s GTRE and awards from Honeywell and Mitsubishi underscore strong partner credibility. Agreements to manufacture critical advanced gas, steam, and nuclear turbine components enhance vertical integration and product breadth.

4. Market Position & Competitive Advantage:

Serving six major aerospace & defence OEMs and five leading turbine manufacturers, Azad holds about 75% share in gas turbine components. High entry barriers include lengthy qualification cycles (30-48 months), capital intensity, and zero-defect quality demands. With ~92% export revenue spanning 12 countries, Azad’s engineering expertise, integrated supply chain, and lean operations form a scalable moat against global competition.

5. Investor Implications:

Record financials, a robust order book, and operational leverage signal positive growth potential. Capacity expansions and strategic partnerships strengthen competitive positioning, while QIP funding supports disciplined capex. High margins and improving ROCE highlight efficiency. Execution risks on expansion and new markets exist, but durable customer relationships and resilient end-markets in energy, aerospace, and defence underpin a constructive outlook.