Acquisition-driven scale masks operational loss

Operational EBITDA solid (15% adj. margin) but net loss ₹108.3 Cr (NPM -6.2%) due to ₹190 Cr one-time costs

Legacy Tega revenue ₹4.3 Cr (+21% YoY), EBITDA margin 22.1% confirmed; but represents only 25% of group revenue

₹12.3 Cr order book for Tega legacy; ₹9.6 Cr executable within 1 year; Molycop order book not disclosed

Molycop ₹12.9 Cr revenue for June only (1 month of FY27); EBITDA ₹1.6 Cr (13% margin); margins 30% gross, but per-ton pricing tied to steel indices

Equipment revenue ₹0.36 Cr vs ₹0.64 Cr prior year (-44%); acknowledged as temporary; EBITDA breakeven

Q1 booked ₹190 Cr; Ankur Periwal asked if ₹75–80 Cr more expected; Mehul confirmed ₹190 Cr was it — but prior quarter had ₹70–80 Cr, so total acquisition drag ~₹265 Cr vs ₹110 Cr in initial guidance range.

IND-AS 103 provisional goodwill ₹49.96 Cr (USD 528M); write-down if Molycop EBITDA < ₹1.6 Cr/month sustained.

Net debt fell from ₹95.8 Cr (March) to ₹63.66 Cr (June) via refinancing + equity; strengthens liquidity post-acquisition.

Mehul said 'Q3–Q4 onwards', not immediate. Teams still 'getting together' — means momentum not yet reflected in FY27 guidance.

Revenue ramp expected Q3–Q4 onwards. Teams being strategized; markets identified where Tega strong and Molycop can leverage, and vice versa. Request couple quarters patience; will provide definitive guidance later.

Margin should be relatively flat. Molycop focuses on per-ton profit, not % of sales, because ~85% of contracts tied to steel indices. This protects gross margin from price volatility.

Soft commissioning Jan 2027, commercial production March 2027, subject to regulatory approvals. Two-month window for clearances post-construction.

This is it. We've factored everything into Q1 results.

Tega group: ₹112 Cr (includes ₹26 Cr redeemable preference shares). Molycop: USD 672 million net debt (₹63.66 Cr).

Molycop: USD 28 million for this 10-month period; normalized ~USD 30M annually; next 2 years low–mid USD 30M depending on expansion.

~85% of contracts tied to steel indices; revenue moves up/down with steel. Internally focus on per-ton margin (constant basis). Revenue per ton volatile, profit per ton protected.

12-month volume ended June 2026: 1.204M tons (vs 1.223M prior year, -1.6% YoY). Expected growth 5% volumes, 4% EBITDA on 10-month basis. Early in acquisition; formal guidance later.

Finance cost ₹110–120 Cr for full year. Debt primarily ABL, fluctuates with bar payment timing; anticipated decline by year-end.

>50% market share in core regions. South America largest (copper); North America major gold/copper; Australasia strong; Africa growing (Tega strength benefit).

Maintaining 15% CAGR on consumables. Cross-sell accretive but timing uncertain (couple quarters to finalize). EBITDA margin 20–23% annually sustainable; able to pass through commodity cost inflation.

Tega: container prices up; passed through to customers (~1 quarter lag). Molycop: hedges freight rates; no direct P&L impact.

Identifying non-productive land parcels; evaluating opportunities. Will use proceeds for debt paydown. No material impact to Molycop EBITDA.

Molycop: USD-denominated; Spain & Australia exceptions. Formal hedging program for FX exposure; hedge immediately for non-USD contracts; historically no material FX impact to EBITDA.

No seasonality. Q4 orders serviced in Q1, so not comparable. Long-term sustainable guidance 15% CAGR.

Yes, expect consolidated EBITDA margin in 15% range for full year.

Reaffirmed; Q1 +36% YoY skewed by Q4 order pull-forward, but sustainable CAGR target maintained.

Early in integration; formal long-term guidance deferred to later quarters. Cross-sell upside not yet quantified.

Q1 achieved 15% (₹260 Cr / ₹1,723 Cr); expected to stay in range pending integration progress.

Q1 delivered 24.1%; able to pass through commodity cost inflation with ~1 quarter lag.

Tega excl. Molycop USD 40M (incl. Chile plant); Molycop USD 28M (10-month estimate).

Equipment revenue fell 44% to ₹36 Cr due to customer clearance delays; EBITDA breakeven. Management confident long-term but near-term weakness evident.

Only 1-month consolidated (June); volumes down 1.6% YoY (1.204M vs 1.223M tons). USD 20M synergies over 2–2.5 years is modest. Cross-sell deferred Q3–Q4.

₹50 Cr (USD 528M) provisional goodwill recorded per IND-AS 103; subject to finalization within 1 year. Write-down risk if Molycop EBITDA deteriorates below current run rate.

FY27 finance cost ₹110–120 Cr annualized (vs ₹260 Cr adjusted EBITDA). Even without one-time costs, net profit limited. Debt ₹63.66 Cr (USD 672.5M) still material post-deleveraging.

Varun Jain flagged Chinese competition in grinding media in Latin America. Lance defended on product quality & service, but risk acknowledged in core region.