Moldtek Technologies

Some description of various present and future segments of the company –

Civil Engineering Segment

Steel Detailing

Steel fabrication and structural steel detailing are two important parts of the construction industry. These two groups work in tandem to ensure that structures are made safely, efficiently, and to specification.

• Steel Fabricators: These are professionals or companies responsible for cutting, bending, and assembling pieces of steel into specific shapes or structures. This is often done based on detailed plans provided by structural steel detailers. Once the pieces are fabricated, they’re transported to the construction site for assembly. Steel fabricators often work on projects such as buildings, bridges, and other infrastructures that require steel structures. They also do fabrication for various other industries including automotive, aerospace, shipbuilding, etc.
• Structural Steel Detailers: These professionals prepare detailed plans, drawings, and other documents for steel fabricators and erectors. Using engineering drawings and specifications from architects and engineers, they create detailed ‘blueprints’ for the fabrication and erection of the steel framework. The detailer’s drawings provide all the information needed to cut and weld all pieces together.

There are other entities in the value chain –

• Steel Manufacturers: These are the companies that produce and supply the raw steel that is used by fabricators.
• Architects and Engineers: These are the professionals who design the structures and provide the initial drawings and specifications that detailers use to prepare their more detailed plans.
• Steel Erectors: These are the teams that physically assemble the fabricated steel pieces on the construction site, based on the plans provided by the detailers.
• Construction Companies and General Contractors: These entities manage the overall construction process, often subcontracting the fabrication and erection work to specialist companies.
• Building Owners and Investors: These are the people or organizations that fund and benefit from the final structure

Building owners hire GCs, who then hire steel fabricators and subcontractors, who then hire steel detailers. Their role is to take the initial designs from the architects and engineers and create detailed ‘blueprints’ for the fabrication and erection of the steel framework. Architects and designers are hired by GCs or directly building owners at times. This is key because Mold Tek is looking for prudent acquisition in this space to move into structural designing and architectural services where the value addition is higher. With this, their relations with General contractors (GCs) would increase and they can take end to end responsibility of project architectures, detailing. They want to acquire a company of $5-$10M size where founders can stay for 5+ years with them.

Companies who could be clients/potential clients of Mold Tek in this space –

Major Steel Fabricators:

1. Nucor Corporation: One of the largest steel producers in the United States, with extensive fabrication services.
2. Steel Dynamics: Another large US steel producer and fabricator.
3. Schuff Steel: One of the largest and most experienced structural steel fabricators and erectors in North America, owned by DBM Global.
4. High Steel Structures LLC: A company that offers structural steel fabrication for bridge and building construction.

Major General Contractors:

1. Bechtel: One of the largest globally operating general contractors based in the U.S.
2. Turner Construction: A North America-based, international construction services company.
3. AECOM: A multinational engineering firm with construction services among its offerings.
4. Kiewit Corporation: One of the largest construction and engineering organizations in North America.
5. Skanska USA: An international construction and development company with a strong presence in the U.S.

Mechanical Engineering Segment

BIW Fixture Design

BIW (Body in White) refers to the stage in automotive design or automobile manufacturing in which a car body’s sheet metal components have been welded together. It includes doors, hoods, and deck lids, but does not include the vehicle’s engine, chassis or interior.

BIW Fixture Design refers to the process of designing fixtures that are used in the assembly of the BIW components. Fixtures are essentially jigs that hold the components together in the correct orientation for them to be assembled, usually by welding or similar processes. BIW fixture design involves a combination of mechanical design principles, CAD (Computer Aided Design) tools, and an understanding of the manufacturing processes involved in automobile production.

This design process is important for a number of reasons:

• Precision: Fixtures must be designed to hold components in exactly the right position, to ensure that the final product is assembled correctly.
• Speed: In large scale manufacturing, the speed of assembly can significantly impact the cost and feasibility of the production process. Thus, fixtures should be designed to enable quick and easy placement and removal of components.
• Repeatability: The fixtures should enable the assembly process to be highly repeatable, minimizing variations between different instances of the same product.
• Safety: The fixtures should be designed in a way that is safe for the operators to use, to prevent workplace accidents and injuries.
• Durability: Given the high volumes in automotive production, fixtures must be durable to withstand repeated use over time without wearing out or degrading in performance.

Key players who make BIW fixtures and FFT, VDL, GeStamp are customers –

1. Paslin
2. Hirotec America
3. Fori Automation
4. Esys Automation
5. JR Automation
6. KUKA Systems North America LLC
7. FFT
8. VDL
9. GeStamp

Press Tool Designing and Drafting

Press tool designing and drafting services are related to the creation of press tools, which are used in manufacturing industries to form, shape, or cut materials. These tools are essential components in processes such as bending, punching, forging, or shearing.

Outline of what press tool designing and drafting services typically involve:

• Press Tool Designing: This is the process of creating a detailed and precise blueprint of a press tool. The design should factor in the specific requirements of the production process, the material being used, the shape and dimensions of the product, and the capabilities of the press machine. The tool design should also consider the stresses and forces that the tool will encounter during operation to ensure durability and optimal performance. This often involves using engineering principles, material science, and software tools to come up with the best possible design.
• Drafting Services: This refers to the process of creating detailed technical drawings of the press tool design. Drafting can be done manually, but it’s usually done using computer-aided design (CAD) software. The drafting process creates a visual representation of the press tool, showing all dimensions, parts, and assembly instructions. The drafted plans are crucial for the toolmaker who will fabricate the press tool.

Press tools are used in automotive, aerospace, construction, electronics, medical industry etc.

Key players in press tools in US –

1. Dayton Progress Corporation
2. Wilson Tool International
3. Mate Precision Tooling
4. Impressions Stamping
5. Anchor Danly
6. American Punch Company

Stamp dies segment

Stamping in the engineering space is a metalworking process by which sheet metal or other material is shaped by pressing or punching with a tool called a stamp or die. A “stamping die” is a specialized, precision tool that cuts and forms sheet metal into specific shapes. They are typically constructed from hardened tool steel that can withstand the high stress and wear that comes with continuous use.

The design and manufacture of stamping dies are greatly facilitated by the use of Computer-Aided Design (CAD) and Computer-Aided Manufacturing (CAM) software. These tools allow engineers to create, modify, analyze, and optimize designs digitally before manufacturing the physical tool. This is where Mold Tek would be doing work maybe

Stap dies are used in automotive, aerospace, construction, electronics, medical industry etc.

Key players who make stamp dies –

1. Magna International
2. Gestamp
3. Die-Tech & Engineering
4. Schuler Group
5. Feintool
6. Dongguan Fortuna Metal & Electronics Co., Ltd
7. Manor Tool & Manufacturing Company

Wire Harness Segment

A wire harness, also known as a cable harness or wiring assembly, is a grouping of electrical cables or wires that transmit signals or electrical power. They are often bound together by straps, cable ties, conduit, or a combination of these to form a single assembly. Computer-Aided Design (CAD) is often used in the design and engineering of wire harnesses. CAD tools allow engineers to create 2D drawings or 3D models of the wire harness assembly.

Key players who make these –

1. Yazaki Corporation
2. Sumitomo Electric Industries, Ltd.
3. Delphi Automotive (Aptiv)
4. Leoni AG
5. Motherson Sumi Systems
6. Fujikura Ltd.
7. PKC Group (Motherson Group)

Why Mold Tek

• Cost arbitrage as Indian labor is cheaper for American steel fabricators and GCs to hire for steel detailing kind of services
• Relationship and credential built with clients in steel detailing and MES space over last 8-10 years
• Outsourcing in this industry is still very less as fabricators, GCs do not want to compromise on quality but over time with low cost moat and credentials built, Mold Tek wants to outgrow the underlying industry growth

Prominent work done by the company

• Steel detailing for airports, industrial plants, Amazon warehouse, 64 storied building in Chicago
• Did part of steel detailing for World Trade Center
• Awarded by trade bodies in US in field of civil structural engineering
• Worked as tier-2 supplier for BIW fixture design for EV platform for Tesla
• Working with FFT, VDL, Gestamp in EV related projects. These companies call Mold Tek engineers for on-site work and the relations have strengthened over the years
• Did $1.2M work in poles and transmission tower design (non-automobile work)

Strategy

• Move into architectural and design space
  • Acquire company in architectural and designing space as mentioned above
  • Hired two PE stamp engineers. PE (Professional Engineer) stamp, also known as a PE seal, is a certification mark that signifies that an engineer has been licensed by a state’s licensure board. Each state has its own specific licensure requirements and only individuals who have met these requirements are legally allowed to provide their PE stamp. The PE stamp is used across many disciplines, including civil, structural, mechanical, electrical, and environmental engineering. In the context of structural steel detailing, a PE stamp on the detailer’s drawings signifies that the designs meet the necessary safety and performance standards and comply with applicable building codes. These PE stamp engineers hourly charges can $60-$100 for Mold Tek as against current charges of $28-$30 per hour in steel detailing
• Groom engineers in-house and train them for projects through learning systems made at the company as quality is of greatest importance in this business
• Grow MES segment 25-30% of the pie
  • Currently doing most of the work in BIW space
  • Get into press tool design and drafting services, stamping dyes and wire harnesses in MES

Competitors

• Tata Technologies
• Onward
• CSG Technologies
• Proteus
• Countries – Romania, Indonesia, Philippines

Guidance

• Guidance to maintain EBITDA margins if the sales growth of 25-30% sustains
• Margin improvement triggers
  • If they move higher up in the value chain in architectural and designing services and get direct work from GCs and OEMs
• Target of 55-60 Cr EBITDA in FY24