💰 Financial Performance

Revenue Growth by Segment

Consolidated revenue from operations grew 11.46% YoY to INR 436.46 Cr in FY25 from INR 391.57 Cr in FY24. The growth was driven by a 17.7% YoY increase in the previous fiscal across both product and service segments, though the Australian subsidiary saw a 5% revenue decline in 9M FY25 due to a mining sector slowdown.

Geographic Revenue Split

Thejo operates across India, Saudi Arabia, Australia, Brazil, and Chile. While specific % splits per region are not fully disclosed, the Australian subsidiary is a major contributor, though it faced a temporary slowdown in FY25. The group is expanding its footprint in the Middle East through TE Global FZ-LLC (UAE).

Profitability Margins

Operating margins improved to 18.19% in FY24 from 13.05% in FY23. Profit before tax (PBT) for FY25 stood at INR 67.34 Cr, a 31.37% increase from INR 51.26 Cr in FY24. Margins are expected to stabilize at 16-17% over the medium term due to better fixed cost absorption.

EBITDA Margin

EBITDA margin reached 18.19% in FY24, up 514 bps from 13.05% in FY23. This improvement was driven by the stabilization of raw material costs and strategic focus on high-margin product businesses like mill liners and specialty rubber components.

Capital Expenditure

The company has planned a capital expenditure of INR 40 Cr to expand manufacturing capacity by 2,600 tonnes per annum. This expansion is intended to be entirely funded through internal accruals, maintaining the company's low-debt profile.

Credit Rating & Borrowing

Maintains a 'Stable' outlook with CRISIL. Gearing is exceptionally low at less than 0.1 times as of March 31, 2024. Interest coverage ratio is robust at over 16 times, reflecting very low borrowing costs and high debt-servicing ability.

⚙️ Operational Drivers

Raw Materials

Key raw materials include natural and synthetic rubber, steel for conveyor components, and specialized chemicals for linings. Material costs accounted for INR 93.83 Cr in FY25, representing approximately 21.5% of total revenue.

Import Sources

Sourced globally to support subsidiaries in Australia, Brazil, Chile, and Saudi Arabia. Domestic sourcing is centered in India for the main manufacturing hub in Chennai.

Key Suppliers

Not specifically named, but the company utilizes a diverse vendor base for rubber compounds and steel components to mitigate dependency risks.

Capacity Expansion

Current manufacturing capacity is approximately 3,600 tonnes per annum. The company is expanding this by 2,600 tonnes (a 72% increase) to reach a total of 6,200 tonnes per annum within 10-12 months to meet growing demand in core sectors.

Raw Material Costs

Cost of materials consumed rose 5.37% to INR 93.83 Cr in FY25. The company uses backward integration, manufacturing its own conveyor components and rubber molded parts, to control costs and improve margins by 230-300 bps.

Manufacturing Efficiency

Operating leverage benefits are expected to sustain margins at 16-17% as higher order execution allows for better absorption of fixed employee costs (INR 121.25 Cr in FY25).

Logistics & Distribution

Distribution is handled through a global network of subsidiaries. Shifting costs to new plants and hiring new sales teams in overseas markets temporarily impacted margins in FY23 but stabilized in FY24-25.

📈 Strategic Growth

Expected Growth Rate

15-18%

Growth Strategy

Growth will be achieved through a 72% capacity expansion (adding 2,600 TPA), full acquisition of Australian and Brazilian subsidiaries to capture 100% of profits, and aggressive cross-selling of manufactured products through existing Operations & Maintenance (O&M) service contracts.

Products & Services

Conveyor belts, conveyor components, rubber molded components, mill liners, filtration systems, rubber linings, and specialized O&M services for material handling equipment.

Brand Portfolio

THEJO, Thejo Hatcon (Saudi Arabia), Thejo Australia.

New Products/Services

Focusing on high-margin specialty products and machines, including customized equipment for mineral processing, expected to sustain operating margins above 16%.

Market Expansion

Full acquisition of subsidiaries in Australia and Brazil completed in 2025. Target regions include the Middle East (via UAE subsidiary) and deeper penetration in the Latin American mining markets (Chile/Brazil).

Market Share & Ranking

Established player in niche material handling and corrosion protection segments; however, scale remains 'modest' compared to global engineering giants.

Strategic Alliances

Acquired the remaining 20% stake in the Australian subsidiary from Bridgestone in 2025 as Bridgestone exited the conveyor belt business globally.

🌍 External Factors

Industry Trends

The industry is shifting toward integrated service-plus-product models. Thejo is positioned as a one-stop-shop for material handling, moving from just servicing belts to manufacturing the entire component ecosystem.

Competitive Landscape

Competes with large global engineering firms and local niche players. Competitive advantage lies in lower overheads and specialized R&D for rubber-based corrosion protection.

Competitive Moat

Moat is built on 'sticky' O&M contracts and backward integration. By providing on-site services, Thejo creates high switching costs for mines and plants that rely on them for 24/7 material flow efficiency.

Macro Economic Sensitivity

Highly sensitive to the industrial production cycles of core sectors (Steel, Cement, Power). A 1% decline in core sector GDP growth typically correlates with reduced O&M service frequency.

Consumer Behavior

Industrial customers are increasingly outsourcing maintenance to specialized players to focus on core production, benefiting Thejo’s O&M segment.

Geopolitical Risks

Management maintains 'cautious optimism' due to prevailing geopolitical conditions that threaten global supply chains for industrial products.

⚖️ Regulatory & Governance

Industry Regulations

Subject to Section 148 of the Companies Act for maintenance of cost records for manufactured products. Compliant with Regulation 33 of SEBI LODR for financial reporting.

Environmental Compliance

Maintains compliance with pollution norms for rubber manufacturing; no material ESG-related penalties disclosed.

Taxation Policy Impact

Effective tax rate is approximately 25-26%, with FY25 tax expense at INR 17.56 Cr on PBT of INR 67.34 Cr.

Legal Contingencies

No material pending litigations or defaults on statutory dues (GST, PF, Income Tax) were reported by auditors for the period ending March 31, 2025.

⚠️ Risk Analysis

Key Uncertainties

Susceptibility to cyclicality in end-user segments (Mining/Steel) could impact revenue by 5-10% during economic downturns.

Geographic Concentration Risk

Significant revenue concentration in Australia and India. The Australian mining slowdown is a primary risk factor for consolidated performance.

Third Party Dependencies

Low dependency on any single third-party vendor due to backward integration into manufacturing core components.

Technology Obsolescence Risk

Risk is mitigated by continuous R&D in polymer science and rubber molding to ensure products meet the evolving durability requirements of high-wear mining environments.

Credit & Counterparty Risk

Receivables are generally from large, credit-worthy core-sector companies, though the company monitors working capital closely to maintain its < 0.1x gearing.