💰 Financial Performance

Revenue Growth by Segment

Total income grew 14.72% YoY to INR 30.15 Cr in FY25 from INR 26.28 Cr in FY24. The growth is driven by the core Mould Base and Engineering components segment, with a significant transition underway into the Defence and Aerospace vertical which is projected to scale from 22,500 pieces in FY26 to 1,30,000 pieces by FY28.

Geographic Revenue Split

Historically domestic-focused with facilities in Ahmedabad and Palghar; however, the company has established marketing tie-ups in Saudi Arabia, Bahrain, Kuwait, UAE, USA, and NATO countries to explore international orders for artillery shells and aerospace components.

Profitability Margins

Net Profit ratio stood at 17% in FY25, a slight decrease from 19% in FY24 (-7.54% change). Future defence contracts are projected to maintain PAT margins between 16% and 20% as the product mix shifts toward high-precision artillery shells.

EBITDA Margin

EBITDA margins for the upcoming defence manufacturing expansion are projected at 28-30% for FY26, increasing to 30-34% for FY27 and FY28. This high margin is attributed to the specialized nature of filled shells and explosives contracts.

Capital Expenditure

The company is currently executing CapEx for 'Line 2' and a new upcoming defence facility in Faridabad. While specific historical INR Cr values for the new line are not totaled, the Debt/Equity ratio is projected to increase from 0.2 to 0.5 by FY28 to fund this expansion.

Credit Rating & Borrowing

The company is currently Long-Term Debt Free as of the FY25 annual report. The Debt Service Coverage Ratio improved by 176.32% to 19.87, indicating a very high capacity to service new loans for expansion.

⚙️ Operational Drivers

Raw Materials

High-grade steel and specialized alloys for mould bases and artillery shells represent the primary cost components; specific percentage of total cost not disclosed.

Import Sources

Sourced primarily from domestic markets in India (Maharashtra and Gujarat) for existing tool operations, with international supply chains being established for defence-grade materials.

Key Suppliers

Not specifically named in the documents; however, the company relies on industrial metal suppliers for precision engineering.

Capacity Expansion

Current focus is on the Faridabad defence facility. Planned expansion aims to increase production from 22,500 pieces in FY26 to a best-case scenario of 210,000 pieces by FY28 for the M107 artillery shell line.

Raw Material Costs

Raw material costs are managed through a 30% advance payment structure for defence contracts, which mitigates working capital pressure and locks in procurement pricing.

Manufacturing Efficiency

Successful machine running trials were completed in September 2025 for the artillery shell line, marking the transition from tooling to mass defence production.

Logistics & Distribution

The company entered a strategic MOU with a Middle East partner to handle logistics, on-ground operational requirements, and local regulatory formalities for international orders.

📈 Strategic Growth

Expected Growth Rate

477%

Growth Strategy

The company plans to achieve this volume growth (from 22,500 to 130,000 units) by transitioning from a tooling manufacturer to a major defence player. Strategy includes manufacturing empty artillery shells (M107), R&D for CCF and PGK fuses, and leveraging a strategic MOU with a Middle East partner for government liaison and order execution.

Products & Services

Mould bases, ground plates, precision CNC machining, empty artillery shells (M107), aerospace parts, and upcoming CCF/PGK fuses.

Brand Portfolio

Sunita Tools.

New Products/Services

Empty artillery shells (M107) and aerospace components are the primary new drivers, with forward integration into filled shells and fuses expected to contribute significantly to revenue by FY28.

Market Expansion

Targeting Middle East and North African (MENA) markets and NATO countries through local partnerships and marketing agents.

Market Share & Ranking

The company is part of the US$ 2.50 billion Indian tooling industry and is positioning itself to capture a share of the ₹1.46 lakh crore Indian defence production market.

Strategic Alliances

Strategic MOU with a (Friendly) Middle East-based company for facilitation, paperwork, and execution of M107 defence orders.

🌍 External Factors

Industry Trends

The Indian defence sector is growing at an 8% CAGR, with private sector contribution reaching ₹32,000 crore (22%) in FY25. Private firms are projected to grow at 25-40% CAGR, outpacing DPSUs.

Competitive Landscape

Competes with both Domestic Public Sector Undertakings (DPSUs) and emerging private players in the defence manufacturing space.

Competitive Moat

Moat is built on 36+ years of precision engineering experience, compatibility with both NATO and Indian systems, and a strategic location for defence manufacturing.

Macro Economic Sensitivity

Highly sensitive to Indian defence modernization budgets and the 'Aatmanirbhar Bharat' mission, which saw 80% of FY25 defence contract value awarded to Indian firms.

Consumer Behavior

Shift in government procurement toward private Indian firms (92% of FY25 contracts by number) favors the company's expansion.

Geopolitical Risks

Global geopolitical tensions are a primary driver for the increased demand for artillery shells, but also present risks of supply chain disruptions.

⚖️ Regulatory & Governance

Industry Regulations

Subject to heavy defence regulations, export restrictions, and stringent quality standards for aerospace and artillery components.

Legal Contingencies

The company paid SOP fines to BSE for delayed filings of Form AOC-4 XBRL, SH-7, and MGT-14/15. No major pending court cases affecting the existence of the company were reported by the board.

⚠️ Risk Analysis

Key Uncertainties

Technology and design bottlenecks in the transition to high-precision defence manufacturing could impact the ability to meet the FY28 volume projections.

Geographic Concentration Risk

Currently concentrated in India (Maharashtra/Gujarat), but rapidly expanding geographic risk to the Middle East through new MOUs.

Third Party Dependencies

Significant dependency on a Middle East partner for the execution and facilitation of upcoming M107 defence orders.

Technology Obsolescence Risk

Rapid technological advancements in fuse technology (CCF/PGK) could render existing artillery shell designs less competitive if R&D goals are not met.

Credit & Counterparty Risk

Trade Receivable Turnover Ratio was 2.14 in FY25; the company uses 30% advance payments for defence orders to mitigate counterparty credit risk.