Salasar Techno Engineering FY2026: Order Book Overshadows Margin Collapse

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1. At a Glance

The company wrapped FY2026 with ₹1,503 Cr in revenue—4% growth, barely faster than inflation. Consolidated net profit fell 8% to ₹18 Cr, with standalone shrinking 67% to ₹17 Cr. The quarter alone lost ₹12.5 Cr.

Yet the order book sits at ₹2,058 Cr, roughly 1.4x annual revenue, with ₹1,808 Cr locked in EPC projects backed by government cheques.

Operating margin compressed 280 basis points year-on-year to 7.5%—the tightest in a decade. ROE has collapsed to 2.1%, ROCE to 8.1%. Interest coverage fell to 1.7x. Debt climbed 21% to ₹422 Cr.

The central tension: a company drowning in work (on paper) while its factory floor margins are being hollowed out by raw material inflation and competitive bidding.

2. Introduction

Salasar Techno Engineering was born in 2006, riding the tower boom. It now makes galvanized steel structures for telecom and transmission towers, utility poles, railway over-bridges, electrification pylons, and stadium light rigs. It also swings a pick on engineering, procurement, and construction (EPC) contracts—the infrastructure equivalent of marriage counselling: messy, long-term, and never on schedule.

The outfit runs three factories in Hapur, Uttar Pradesh (total capacity 1.96 lakh MT per annum for galvanized steel; another 15,000 MTPA for heavy steel girders). The client roster reads like a government infrastructure checklist: Power Grid, Indian Railways, Indus Tower, Delhi Metro Rail Corporation, Bharti Airtel. Orders flow from tenders, mostly government-backed, mostly Delhi-to-Assam.

April 2025 brought an unwanted guest: the Enforcement Directorate raided the homes of Chairman Alok Kumar and Joint MD Shashank Agarwal. No findings disclosed. No business disruption reported. Credit rating agencies bought it—Infomerics pulled the rating off watch in October 2025, reaffirmed IVR A/Stable.

Warrant chaos followed: 8.62 Cr warrants issued April 2024 at preferential terms. Exercise period expired October 2025. Promoters exercised all theirs. Non-promoters left 3.25 Cr on the table; company forfeited 25%, pocketing ₹117 Cr.

Two mergers are now in motion—EMC Limited (wholly owned subsidiary) approved by NCLT May 2026, and Hill View Infrabuild, awaiting NCLT clearance. Effect: June quarter onwards.

3. Business Model: WTF Do They Even Do?

Two buckets.

Steel Structures: manufacture and sell pre-engineered galvanized beams, towers, poles. FY2026 this was ₹974 Cr, about 65% of revenue. Gross margin here is structural—raw steel is globally priced, power is costly, galvanization is a commodity margin game. Telecom buyers are price-killers. Government procurement is tender-driven; margins go to whoever submits the lowest bid.

EPC Projects: the heavy lifting. Design, fab, galvanize, deploy. Government funds railway electrification, transmission lines, overhead structures. FY2026: ₹509 Cr, roughly 35% of revenue. Payment assurance is higher (government cheques, though delayed). Execution risk is why we’re having this conversation—delays, site complications, retention money on invoices, and the working capital gauntlet. The company’s order book is stuffed with EPC work, but converting ink to cash is a relay race where the baton keeps dropping.

Why this split? Because steel structures are capital-lite (order, make, sell in weeks) and margin-poor (bidding warfare). EPC is capital-heavy (you front cash for 18 months before the government’s retainage clears) but higher margin if you don’t get strangled on scope creep.

The math: at ₹2,058 Cr order book and ₹1,503 Cr FY26 revenue, the company has ~14 months of visibility. Sounds solid. But tender-driven businesses live quarter to quarter. One ministry’s spending freeze, or one political shift, and that book evaporates into a work-in-progress bottleneck.

4. Financials Overview

Figures are consolidated, in ₹ crore.

The latest quarter (Mar 2026) was a train wreck: revenue ₹445 Cr (flat YoY), but net profit crashed to -₹12.5 Cr from ₹-0.5 Cr a year prior. Operating profit shrank to ₹14 Cr from ₹27 Cr. OPM fell to 3%—a company trying to build its way out of a hole while drilling faster.

Cash flow context: Operating cash flow for FY26 was ₹161 Cr (standalone: only ₹1.2 Cr), a bright spot. But investing outflows of ₹228 Cr (capex for new capacity and working capital for the EPC inventory mountain) and financing inflows of ₹66 Cr left the company with net cash outflow of ₹1.6 Cr. Translation: the order book is eating cash, not generating it—yet.

5. Market Expectations & Historical Multiples

This section describes how the market is currently pricing the company and how that compares with its own history and peer group. It is descriptive, not