Kilburn Engineering – Huge undervaluation

Notes from Q1 FY 25 call

1. Q1 FY 25 Standalone revenue: 64 Cr, Consol. revenue (post-acquisition of ME Energy) at 85 Cr
2. Total order book 370 cr
   • 50-60% of the order book comprises repeat customers, indicating strong client relationships and satisfaction.
   • Deferred orders impacting revenue: Two orders delayed, worth approx. ₹40 crores
3. Enquiry pipeline is 2000 cr +

• Focusing on projects with higher revenue and higher margins

4. At a group level, order intake of 500 cr expected for whole year

5. Capex outlook

• 5 to 10 cr for M.E. Energy
• 22 cr to acquire additional factory unit

6. Acquisition of factory unit in Ambernath for 22 cr, subject to due diligence

• Expected revenue of ₹100 crores.
• Process likely to be completed in 2-3 months

7. With the acquisition of additional factory unit, some of projects being executed from existing Kilburn plant likely to move there and the core Kilburn plant likely to be used for more value added projects like – manufacturing of titanium equipment to be used in defence and other customized equipment

8. Guidance of 500 cr revenue and 20%+ profitability on consolidated basis for FY 25

• Due to economies of scale and operating efficiencies

9. Ability to scale up to 700 to 750 cr of revenue in the next 3 years or so –

• Depending on the order mix that company gets though

Disc: Invested from lower levels, biased