Strong quarter masking execution delays; margin pullback expected

Actual revenue ₹121.4 Cr (9.9% YoY growth), call claimed ₹124.68 Cr (12.78%)

MD stated 50:50 split; acknowledged gains unlikely to repeat continually

Delay to December end from original October timeline = 50% reduction in FY27 contribution

MD cautioned 'not sure same results can be repeated ever continually'; future quarters to moderate

Only 20% utilization (240 MT of 1,200 MT) expected in FY28; slow ramp acknowledged

Prior: ₹250 Cr (full year). New: ₹125 Cr (Q4 only, Dec-Mar). Delay from Oct to Dec = 2-month slip × 50% reduction in FY27 impact.

Prior: August 2026. New: Year-end FY27. Reasons: scope expanded (5-tank → 12-tank structure), team shared with R32, monsoon delays in Andhra Pradesh.

MD shifted from 'strictly no dilution' to 'may dilute equity + debt' for HFO plant and working capital ramp. Funding no longer fully internal-accrual driven.

Reaffirmed as 'intact' on call despite Q1 missing growth target (9.9% vs 12.78%). Math hinges on three-plant ramp in FY28 to >₹1,100 Cr.

Kept as 'over medium term' (vague). MD explicitly hedged: 'impressive margins not actual numbers at current business level'; future quarters to moderate.

50:50 split between planning/logistics execution and inventory gains. Margins will improve but not at this level continually. Part of Q1 was one-time benefit from high stock-keeping.

Yes, 12% contribution expected. PAT margin will be higher than 15% (we've said 15% but will be better).

Guidance based on worst-case ₹550/kg realization, not peak ₹700-800. Workable even at current ₹800 pricing.

Same team working on both Bhilwara and Mambattu. Prioritized Bhilwara. Mambattu complements R32 anyway, delay has no material loss.

The 30-35% is intact (reaffirmed). Three years in a row, driven by new plants and higher-value products.

No. This is a special quarter with planning and execution timing. Not sustainable at these levels. Working towards profitability.

September share-price spike killed preferential issue plan. Had to shift to rights issue. Funding delayed to February. Startup pushed from Dec to March (now Dec-end).

Would change a little bit. Q4 should be approximately ₹125 Cr. FY28 target of ₹500-600 Cr still holds.

EBITDA up 3-4% with production plants. PAT: 50% core business ~10%, 50% new (24% on R32) = averaging out. FY28: 15-17% PAT margin with 50:50 mix.

Exceeding ₹1,100 Cr revenue. Approximately 15% PAT margin minimum. (Then hedged: these are endeavors we're working towards.)

Multiple sourcing de-risking: Sharjah Oxygen partnership, swapping mechanism, alternative sources. Price: next 2-3 years outlook shortfall and higher pricing.

Desire not to dilute, raise from internal accruals. But if want faster growth, capital may be needed. Internal accruals substantial but may require debt/dilution for HFO plant timing.

HFO next. 20-year Honeywell relationship ensures we safeguard their IP. Confident we can proceed with proper regards to their interests.

Current turnover ~₹400 Cr. 30% of 400 = ₹120 Cr. Even with ₹125 Cr from R32, hits 525 (30% growth). Math works over 3 years.

Experienced management doesn't pre-sell without airtight contracts. Commitments lock in low prices; if prices fall, buyer walks. No value in MOUs. Before R32, imports >4,000 tons; internal needs 40-50% of production. Remaining easily sold.

Multiple local + global manufacturers. New capacities coming by next year. By 2028, expect AHF glut. Confidential strategy in place; yes, we have AHF source planned. Multi-source approach; won't depend on single supplier.

No. 1,200 MT is capacity, not guaranteed supply. Ramp will be incremental (50, 100, 200 MT). Won't reach full in 2-3 years. FY28 targeting 20% utilization only.

HFO plant CAPEX ₹350-400 Cr for 10,000 MT (5,000+5,000). Mambattu instant revenue jump ~10% (import replacement, 60% R32 + blending). Long-term: 1-2 years later, HFO blends business grows significantly.

Chemical process plant normally 24 months; Chinese won't do <18 months. We're delivering in 9 months (with 2-shift work). Even if delayed 2-4 months, it's half the industry norm. Mambattu: scope expanded (5→12 tanks), complete redesign required; monsoons in Andhra affected neighbors, not us.

Not decided yet. Internal meetings showed sticking to no-dilution + internal accruals would delay growth significantly or push debt above prudent levels. Now open to some dilution + debt. Not finalized; discussing options.

Last 2 years, imports dropped to negligible. Whatever we sell in R32 is incremental to current revenue. Profitability delta vs. procured product will boost overall returns elsewhere.

We don't buy HF from that company, never have. Other sources already outlined + new manufacturers coming. Quotas: HF doesn't need it. R32 everyone gets quota per process. Till government declares, everyone hopeful.

India needs 20,000 tons; coming capacity 70-90,000 tons (4x). Much from export. 2028: China GWP quota cuts 1,20,000 tons. Plants are swing plants—can make 125, 124a, etc. Not sacrosanct. Swing dynamics mean utilization fluidity, not linear.

Regulatory requirements underway.

Reaffirmed on call as 'intact' but Q1 missed growth claim (9.9% vs 12.78%). Hinges on three-plant ramp (Khalapur, Mambattu, R32) to >₹1,100 Cr by FY28.

Plant complete, Q2 online. 20% utilization FY28 (240 MT of 1,200 MT at ₹4,000/kg approx. ₹96 Cr potential, but only ~₹50 Cr expected near-term).

December commissioning (2-month delay from Oct). Based on worst-case ₹550/kg realization. Current pricing ₹800/kg (off-peak). Quota uncertainty remains (government decision pending).

Scope expanded, timeline slipped 5 months. Tied to R32 ramp for full effectiveness. Profitability lift more immediate than revenue.

Q1 at ~20% EBITDA margin; MD explicitly hedged as 'special quarter' with 50% one-time inventory gain. Medium-term implies 2-3 years post-plant ramps.

Analyst validated this; 50:50 mix in FY28 = ~15-17% blended PAT margin. Depends on full R32 utilization + margin protection vs. pricing pressure.

Helium pricing stable at ₹4,000/kg. Margin upside if pricing holds; risk if supply shortage reduces scarcity premium.

Financing strategy under review (internal + debt vs. dilution). Announcement post-R32 commissioning (year-end FY27). Honeywell IP compliance required.

MD stated 'very much in control.' R32 CAPEX borne via rights issue (Feb 2026). Mambattu scope expanded but still within planned envelope.

Bhilwara (R32), Mambattu, HFO plant all critical path. R32 already 2 months delayed; Mambattu 5 months delayed. Concurrent ramp increases risk of further slips or quality issues.

R32 manufacturing quota not yet declared by government. Company assumes full 10,000 MT allocation; if quota < capacity, revenue/margin targets miss. Competitors also bidding.

Q1 EBITDA gain 75.85%; 50% from inventory timing (Gulf crisis stockpiling), 50% operational. MD explicitly stated 'not sure same results can be repeated continually.' Future quarters expected to moderate significantly.

Three simultaneous plant ramps + HFO CAPEX (₹350-400 Cr) will strain cash. MD shifted from 'no dilution' stance to 'may need equity + debt.' Exact capital plan not finalized; equity dilution extent unknown.

Helium supply dependent on Middle East (Sharjah Oxygen partnership) + Qatar Gas agreement. Middle East shipping disruptions (Houthi blockade, Gulf tensions) could interrupt supply. Swapping mechanism mitigates but not 100% protective. Pricing upside if shortage persists (favorable for company) but availability risk remains.

India R32 demand ~20,000 tons/year; incoming capacity 70-90,000 tons (4x demand). Most plants are swing plants (can make 125, 124a, etc.). Pricing pressure likely unless export demand absorbs excess. Competitors rushing to 32 may see it become unlucrative; margin compression risk.

HFO is patented by Honeywell; Stallion has 20-year distribution relationship. MD says will respect IP, but HFO manufacturing planning may face constraints or require Honeywell approval. AHF (raw material) sourcing also carries latent dependency risks if supplier concentration exists.