TIIL - Technocraf.Inds.

📊 NSE: TIIL 🏢 Steel - Medium / Small 📅 Last Updated: 12/14/2025 14:16

💰 Financial Performance

Revenue Growth by Segment

Consolidated revenue grew 10% YoY to INR 2,182 Cr in FY24. Segment growth was led by Scaffolding at 16% (INR 1,032 Cr) and Drum Closures at 16% in 9M FY25. The Yarn division saw a 6% revenue drop in FY24 but recovered with 8% growth in 9M FY25. Engineering & Designing (ER&D) revenue reached INR 238.52 Cr on a TTM basis as of Sep-25.

Geographic Revenue Split

TIIL derives 69% of its total revenue from global markets. The Scaffolding and Formwork segment is particularly export-oriented, with 70-75% of its revenue accruing from overseas markets, including 50% of segment sales specifically to the US.

Profitability Margins

Operating margins stood at 19% in FY24 but moderated to 16% in 9M FY25 due to higher raw material costs. PAT margin was 12.78% in FY24 (INR 279 Cr PAT). The company expects margins to stabilize at 16-17% over the medium term as it passes on tariff costs to customers.

EBITDA Margin

Operating profit margin was 18.87% in FY25 compared to 17.95% in FY24, representing a 5.10% improvement. However, 9M FY25 margins dipped to 16% from historical levels of 21-23% due to raw material volatility and US steel tariffs.

Capital Expenditure

TIIL is executing a INR 525 Cr capex plan across its scaffolding and textile divisions (FY24 and YTD FY25). This expansion is funded 40% by debt and 60% through internal accruals to support the new aluminum formwork segment.

Credit Rating & Borrowing

The company holds a 'CRISIL A1+' short-term rating and a 'CRISIL A+/Positive' long-term rating. Interest coverage remains robust at 12.43 times in FY25, up from 10.25 times in FY24, indicating strong debt-servicing capability despite new borrowings.

⚙️ Operational Drivers

Raw Materials

Primary raw materials include Steel (for scaffolding and drum closures) and Cotton (for the yarn and fabric divisions). Steel costs are highly sensitive to global commodity cycles and US import tariffs of 25%.

Capacity Expansion

Current drum closure capacity is 75 million sets (55M in India, 20M in China). Scaffolding capacity is 50,000 tonnes. Expansion is underway in the aluminum formwork segment, with enhanced capacities expected to be commissioned by FY26.

Raw Material Costs

Raw material costs led to a margin compression from 19% to 16% in 9M FY25. The company employs a pass-through mechanism for tariffs and uses cost-optimization measures in the textile division to mitigate high cotton prices.

Manufacturing Efficiency

Operating efficiency is supported by technical expertise in drum closures (36% global market share). Return on Net Worth improved to 17.07% in FY25 from 12.52% in FY24 due to better asset utilization.

📈 Strategic Growth

Expected Growth Rate

10-15%

Growth Strategy

Growth will be driven by the commissioning of enhanced aluminum formwork capacity in FY26 and a strategic pivot toward the domestic Indian construction and infrastructure market. The ER&D division is targeting a quarterly revenue run rate of INR 75-80 Cr by Q4 FY25 through increased bench strength and operating leverage.

Products & Services

Drum closures, clamps, metal capseals, scaffolding systems, MachOne engineered formwork, cotton yarn, fabric, and engineering & design (ER&D) services.

Brand Portfolio

MachOne (Formwork systems).

New Products/Services

Sophisticated engineered aluminum formwork systems and lower-value scaffolding products tailored for the domestic Indian market.

Market Expansion

Expansion into the domestic Indian building, construction, and infrastructure sectors to offset global slowdowns and trade barriers in the US and Europe.

Market Share & Ranking

TIIL is the leading global manufacturer of drum closures with a 36% worldwide market share. It is also a significant player in the international scaffolding industry.

Strategic Alliances

The company operates through several marketing subsidiaries in the US, Europe, and Australia, and has manufacturing operations in China.

🌍 External Factors

Industry Trends

The industry is seeing a demand revival in drum closures (16% growth) and a shift toward sophisticated engineered formwork in construction. TIIL is positioning itself by expanding its aluminum formwork capacity to meet this technological shift.

Competitive Landscape

TIIL maintains a dominant position in drum closures and is increasing market share in scaffolding, competing against global players in the oil & gas and infrastructure supply chains.

Competitive Moat

TIIL's moat is built on a 36% global market share in drum closures and high technical expertise. This is sustainable due to the value-added nature of drum closures and the company's established global distribution network.

Macro Economic Sensitivity

Highly sensitive to global economic revival and commodity price cycles (Steel and Cotton). A slowdown in global economic operations directly impacts the 69% of revenue derived from international markets.

Consumer Behavior

Increased demand for sophisticated, engineered formwork systems for building and infrastructure projects is driving the company's shift toward value-added products.

Geopolitical Risks

Trade barriers, specifically the 25% US tariff on steel, represent a major geopolitical risk to the scaffolding segment's profitability and competitive positioning in North America.

⚖️ Regulatory & Governance

Industry Regulations

Operations are subject to international trade regulations, specifically US steel tariffs and global manufacturing standards for drum closures and scaffolding safety.

Legal Contingencies

The company has an unmodified report on Internal Financial Controls; specific pending court case values are not disclosed.

⚠️ Risk Analysis

Key Uncertainties

Volatility in raw material prices (Steel/Cotton) and the sustainability of demand in the US market following tariff impositions are the primary uncertainties, with potential margin impacts of 3-5%.

Geographic Concentration Risk

High concentration in the US and Europe, with 50% of scaffolding sales tied to the US market, making the company vulnerable to regional economic downturns.