Summary
Manaksia Coated Metals & Industries Limited - Q3 FY 2026 Earnings Call Summary Wednesday, February 04, 2026 11:30 AM
Event Participants
Executives 3 Karan Agrawal (Whole-Time Director), Mahendra Bang (Chief Financial Officer), Tushar Agrawal (Senior Vice President)
Analysts 4 Ashwani Agarwal (Casa Capital), Dhaval Jain (Sequent Investment), Nishita (Sapphire Capital), Sameera (Individual Investor)
Financials & KPIs
| Metric | Reported | Commentary |
|---|---|---|
| Total Income (Consolidated) | ₹190 crores | -9.00% YoY; Decline due to a planned 35-day plant shutdown for technology upgradation. |
| EBITDA | ₹19 crores | +7.00% YoY; Growth driven by improved operational efficiency and product mix despite lower volumes. |
| EBITDA Margin | 10% | +144 bps YoY; Reflects transition toward higher value-added products and better price realizations. |
| Net Profit (PAT) | ₹7 crores | +47.00% YoY; Significant surge attributed to lower interest costs and improved margins. |
| Net Margin | 4% | +146 bps YoY; Driven by higher realizations from export markets (67% of revenue). |
| 9M FY26 Revenue | ₹580 crores | +15.00% YoY; Reflects strong H1 performance and consistent demand in international markets. |
| 9M FY26 PAT | ₹35 crores | +241.00% YoY; Massive growth due to higher capacity utilization (95% in color coating) and export strategy. |
| Order Book (Exports) | ₹350 crores | Strong visibility for upcoming quarters; focuses on high-quality OEM customers in the EU. |
Geographic & Segment Commentary
- International Markets (EU): Revenue contribution stood at 67% for the 9-month period. Management remains bullish following the India-EU FTA, anticipating preferential treatment in quotas and Carbon Border Adjustment Mechanism (CBAM) values. The company maintains long-term relationships with quality-conscious European OEMs, fetching premium price realizations compared to domestic sales.
- Domestic Market: Experienced a protracted dull period from June to November 2025; however, demand surged from December 2025 onwards. Key growth drivers include pre-engineered building (PEB) customers and sandwich panel manufacturers. Management expects high domestic demand to sustain through July 2026.
Company-Specific & Strategic Commentary
- Alu-Zinc Technology Transition: Completed a 35-day shutdown in Q3 to upgrade from galvanizing to 100% Aluminium-Zinc coating technology. This increased capacity by 36% to 1,80,000 tons per annum, positioning the company among select Indian players with this capability.
- Operational Debottlenecking: The second color coating line (ECCL-2) is on track for early FY27 commissioning. This will increase total coating capacity by 174% to 2,36,000 tons per annum, allowing for 100% internal absorption of Alu-Zinc coils into higher-margin pre-painted products.
- Energy Efficiency: A 7-megawatt peak captive solar power plant is targeted for Q1 FY27. It is projected to offset 50% to 55% of grid power consumption, significantly reducing conversion costs and expanding EBITDA margins.
- Digital Transformation: Partnered with Salesforce to implement a CRM system. This initiative aims to improve data-driven customer engagement and higher sales conversion rates.
Guidance & Outlook
| Metric | Guidance / Outlook | Commentary |
|---|---|---|
| Capacity Utilization (Alu-Zinc) | 25-35% of capacity benefit in Q4 FY26 | Gradual ramp-up following the December shutdown; full benefits expected from Q1 FY27. |
| Capacity Utilization (FY27) | 65-70% on expanded base | Targeted utilization for the new total capacity of 2,36,000 tons per annum. |
| Margin Expansion | Gradual growth through FY27 | Driven by the “double benefit” of lower energy costs (solar) and higher value-add (Alu-Zinc vs. Galvanized). |
Risks & Constraints
| Risk | Context |
|---|---|
| Raw Material Volatility | Non-ferrous metal prices (Zinc/Aluminium) rose from $2,700 to ~$3,500/ton. Management mitigates this via a 30-day price pass-through mechanism to OEMs and export clients. |
| Transition Bottlenecks | Q4 FY26 may face a temporary mismatch where Alu-Zinc capacity exceeds color-coating capacity. Management plans to sell unpainted Alu-Zinc in the interim to maintain volumes. |
| Trade Regulations | While the India-EU FTA is signed, specific steel incentives and CBAM default values remain undefined. Management is monitoring the April-September 2026 window for regulatory clarity. |
Q&A Highlights
Price Realization & Product Mix
- Question: What is the realization gap between Alu-Zinc and pre-painted products? (Dhaval Jain)
- Answer: Pre-painted Alu-Zinc achieves ₹83,000–₹85,000/ton, while unpainted Alu-Zinc fetches ₹71,000–₹73,000/ton, representing a ~14% value-add premium (Karan Agrawal).
Plant Shutdown Impact
- Question: What was the impact of the maintenance shutdown on Q3 volumes? (Dhaval Jain)
- Answer: Galvanizing line utilization dropped to 68% in Q3 vs 81% in Q2. Total volumes were 22,896 tons in Q3 vs 24,037 tons in Q2 (Mahendra Bang).
Raw Material Costs
- Question: How will rising metal prices affect margins? (Sameera)
- Answer: Costs are passed on to customers within 30 days, keeping margins intact despite Zinc/Aluminium touching $3,500/ton (Karan Agrawal).
Funding & Liquidity
- Question: How is the company funding the new color line and solar project? (Ashwani Agarwal)
- Answer: Financial tie-ups are already achieved through a mix of internal accruals and long-term bank debt; no immediate equity dilution is required (Karan Agrawal).
Key Takeaway
Manaksia Coated Metals delivered a resilient Q3 FY26 despite a planned 35-day shutdown, with PAT growing 47% YoY to ₹7 crores and 9M FY26 PAT surging 241% to ₹35 crores. The strategic transition from Galvanized to Alu-Zinc technology is now complete, increasing capacity by 36% to 1,80,000 MTPA. The company is currently executing two major margin-accretive projects: a 7MW solar plant and a second color coating line, both expected by early FY27 to triple coating capacity to 2,36,000 MTPA. With 67% of revenue derived from exports and a robust ₹350 crore international order book, the company is well-positioned to capitalize on the India-EU FTA. Management remains focused on shifting the product mix toward 100% pre-painted Alu-Zinc, which commands a 14% price premium, providing strong visibility for margin expansion through FY27.
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