💰 Financial Performance

Revenue Growth by Segment

Revenue growth was driven by increased turnover in the casting segment, though specific segment-wise percentage splits are not disclosed. The company focuses on low-to-medium volume castings (1–250 kg) for global markets.

Geographic Revenue Split

The company has a strong presence in the United States, Europe, and India, catering to global multinationals. Specific percentage contributions per region are not disclosed in the available documents.

Profitability Margins

Net Profit Margin improved significantly to 13.10% in FY25 from 10.51% in FY24. This 2.59% margin expansion was driven by a substantial increase in absolute profits and better asset utilization.

EBITDA Margin

Operating Profit Margin (PBILDT) stood at 23.00% in FY25, up from 20.84% in FY24. This 2.16% improvement reflects a stronger operating profit base and controlled capital deployment despite ongoing capital work-in-progress.

Capital Expenditure

The company availed a term loan during FY25 for project execution and capital work-in-progress. While the exact INR Cr value of the project is not specified, the debt-equity ratio increased from 0.001 to 0.085 to fund these initiatives.

Credit Rating & Borrowing

CARE Ratings reaffirmed 'CARE BBB+; Stable' for long-term bank facilities (INR 25.00 Cr) and 'CARE A2' for short-term facilities (INR 15.25 Cr) as of December 31, 2025. Interest coverage ratio improved to 97.60 times in FY25 from 83.60 times in FY24.

⚙️ Operational Drivers

Raw Materials

The company utilizes materials for ductile iron and gray iron castings. Raw material costs are a significant constraint, though specific percentage of total cost is not disclosed.

Capacity Expansion

The company operates well-established manufacturing facilities for low-to-medium volume castings (1–250 kg). Current utilization is described as 'relatively lower,' suggesting headroom for growth without immediate massive physical expansion.

Raw Material Costs

Margins are exposed to volatile raw material prices. The company manages this through procurement strategies, though specific YoY cost change percentages were not provided.

Manufacturing Efficiency

Return on Capital Employed (RoCE) improved to 24.22% in FY25 from 19.01% in FY24, reflecting better asset utilization and a stronger operating profit base.

Logistics & Distribution

The company manages global distribution to the US and Europe; however, specific logistics costs as a percentage of revenue are not disclosed.

📈 Strategic Growth

Expected Growth Rate

15%

Growth Strategy

Growth is targeted through increasing scale of operations to exceed INR 300 crore in income. Strategy involves leveraging the 30-year track record in complex castings, focusing on technically demanding low-to-medium volume products for global MNCs, and utilizing existing spare capacity.

Products & Services

Ductile iron castings, gray iron castings, and complex castings ranging from 1kg to 250kg for the automobile and pump industries.

Brand Portfolio

Magna Mastercast

New Products/Services

The company is focusing on 'Complex casting' and 'Magna Mastercast' solutions for diverse applications, though specific revenue contribution percentages for new launches are not disclosed.

Market Expansion

Targeting increased penetration in the United States and Europe by positioning as a 'go-to partner' for global multinationals requiring technically demanding castings.

🌍 External Factors

Industry Trends

The casting industry is evolving toward higher technical complexity and better solutions for end-users. The market is currently fragmented with low entry barriers, leading to significant price competition from unorganized players.

Competitive Landscape

Intensely competitive and fragmented, with significant competition from unorganized sectors and price-sensitive end-users.

Competitive Moat

The moat is built on a 30-year track record, specialized expertise in low-to-medium volume complex castings (1-250kg), and established relationships with global MNCs. This is sustainable due to the high technical requirements of their niche.

Macro Economic Sensitivity

Highly sensitive to the cyclical nature of the automobile and pump industries, which are influenced by global GDP growth and industrial CAPEX cycles.

Consumer Behavior

Shift toward more responsible and sustainable manufacturing, which Magna is addressing through ESG initiatives and energy-efficient manufacturing.

Geopolitical Risks

Trade barriers or economic shifts in the US and Europe could impact the export-heavy revenue model.

⚖️ Regulatory & Governance

Industry Regulations

Operations are subject to the Companies Act 2013, Ind AS accounting standards, and environmental/safety regulations for foundry operations.

Environmental Compliance

The company integrates ESG initiatives, focusing on energy-efficient manufacturing and waste reduction. ESG risks are currently categorized as 'Not Applicable' by rating agencies for the current credit profile.

Taxation Policy Impact

The company follows standard Indian corporate tax rates; specific effective tax rate percentages are not disclosed.

Legal Contingencies

The company has disclosed pending litigations under Note 53 on Contingent Liabilities as of March 31, 2025. Specific INR values for these cases are not provided in the summary.

⚠️ Risk Analysis

Key Uncertainties

Volatility in raw material prices and foreign exchange rates are primary risks that could impact margins by 2-5%. The cyclical nature of the automobile and pump segments remains a key business uncertainty.

Geographic Concentration Risk

Significant revenue concentration in the US, Europe, and India. Specific percentage splits are not disclosed.

Third Party Dependencies

The company relies on third-party consultants for internal control assessments and likely depends on specific suppliers for pig iron/scrap.

Technology Obsolescence Risk

The company is proactive, planning cyber security audits and focusing on complex casting technology to stay ahead of unorganized competitors.

Credit & Counterparty Risk

Receivables quality is stable with a Trade Receivables Turnover Ratio of 3.89. Credit periods offered are 75-90 days for foreign clients and 60-75 days for domestic customers.