Tega Industries Ltd

Analyst Notes

Business Deep-Dive

What Tega sells, product by product

Manufacturing footprint

*Acquisition date of TMML (24 Feb 2023); the plants themselves are older McNally Sayaji facilities. Source: FY26 AR pp.16–17, 48–49. Plant-level capacity figures are not disclosed for Tega; Molycop forged capacity is ~1.7 Mt (Sep-25 call).

Moat: why Tega is hard to replace [Analyst View]

• Engineered-to-order: each liner set is designed for a specific mill's geometry and ore. Management says orders take "3 to 6 months to execute because we are a bespoke, design-led organization". Switching suppliers means re-engineering, trial periods and downtime risk for the mine.
• Critical-to-operate, small share of cost: a liner failure stops a mill producing thousands of tonnes per hour. Buyers optimise for uptime, not price.
• Repeat business: ~75% of sales are repeat orders, with 10+ year relationships [Fact: CRISIL]. No customer is ≥10% of revenue [Fact: AR note 42].
• Proximity: plants in Chile, South Africa, Australia and now, via Molycop, in the Americas, Indonesia and Spain cut lead times and tariff exposure. Management cited US tariffs as an entry barrier that favours Molycop's US plants.
• Grinding media is weaker on moat: forged balls are closer to an indexed commodity. Molycop competes on local supply, service and SAG-ball metallurgy. Chinese competition in LatAm forged media was raised by analysts (Aug-26), and management did not quantify it.

IP, R&D and certifications

Patents include a liner-preparation method (1992 application), an improved screen panel (granted 2010) and mosaic liners for chutes (2013). DynaPrime™ was trademarked in 2019. R&D is based in India and Chile and focuses on smart, IT-enabled products and recycling, including a planned facility to recover rubber and metal from end-of-life liners. Tega is an ISO 9001:2015 company (letterhead), with occupational health and safety systems at Kolkata HQ, Samali, Kalyani and Dahej. Chile holds the HuellaChile GHG seal. A full certification list (ISO 14001/45001 scope) is not consolidated in the filings reviewed.

Customers, go-to-market and exports

• Tega serves 700+ customers in 92+ countries. Its standalone exports were ~84% of turnover [Fact: BRSR FY26], and consolidated revenue outside India was 78% (₹1,318.9 Cr of ₹1,691.9 Cr).
• Molycop serves 400+ mines in 40+ countries. ~83–84% of its revenue or volume comes from copper and gold. Its largest region is South America, then North America and Australasia, with Africa as the growth region.
• Named customers are not disclosed in the ARs or the RHP. The RHP lists major miners (Codelco, Freeport, BHP, Newmont and others) only as industry context, not as customers. Management declines customer-wise detail. NMDC is named as a ~₹120 Cr TMML equipment order (2024–25). On the Molycop side, the commentary on Freeport's Grasberg and First Quantum's Cobre Panama, which tie into the contingent earn-out, implies they are or were major customers [Analyst View]. Tega took part in a BHP-led school programme in Chile (CSR), which indicates a BHP relationship [Analyst View].
• Sales are direct to mines through regional subsidiaries (USA, Canada, Brazil, Chile, South Africa, Ghana, Australia), with installation and service teams on site.

Segment Analysis

Segment revenue and EBITDA (₹ Mn)

Sources: AR FY26 note 42 (FY25/FY26), Q1 FY27 call (segment Q1), Q1 PPT. Q1 consumables margins are as stated by management (24.1% vs 20.9%) and may include other income. FY24 segment split not extracted (FY24 AR reported only consolidated in the pages reviewed), hence the estimate. Adjusted FY26 consumables EBITDA assumes all ₹839 Mn of one-offs sit in Consumables.

Mix shift: what the company is now

Management's stated focus by segment

• Consumables: 15% CAGR, with cross-selling of mill liners into Molycop's 400+ mine base expected to show from Q3–Q4 FY27 onwards. The Chile plant adds LatAm capacity (Chile, Peru, Brazil, Argentina).
• Equipment: 25% growth, the new Japanese-partnered aggregates product in Q3 FY27, and exports to Canada, CIS and the Middle East.
• Molycop: synergies of US$20 mn over 2–2.5 years (US$30 mn run-rate from year 4 per Sep-25 deck), covering HQ relocation (US$7 mn), a GCC (US$5 mn), SG&A −7% and procurement. Also hi-chrome expansion and >US$70–75 mn of non-core asset sales to repay debt.

Financials: P&L

Five-year annual P&L

*Company PPT adj. PAT ₹226.6 Cr; Directors' Report "PAT excluding one-time expenses" ₹208.5 Cr. The two adjusted figures differ, a reconciliation gap. FY22–FY25 margins from AR "operating EBITDA" (19.22/22.27/21.17/20.74/13.66%). FY23 DPS taken from Screener's 7% payout ratio (≈₹2) [Est.]. EBIT is computed. Screener FY26 EPS of 18.99 uses year-end shares; the AR basic EPS of 20.54 uses the weighted average.

Last eight quarters (consolidated)

*Jun-26 = Q1 FY27, including Molycop for June only. Screener's EPS for the quarter is −14.41; the company-reported EPS is −11.47, and the difference likely comes from the minority share of Molycop's loss. Dec-25 and Mar-26 operating EBITDA include ₹77.6 Cr of Molycop deal costs and ₹6.4 Cr of labour-code charges. Company adjusted EBITDA is ₹600→773 Mn (Q3) and ₹967→1,632 Mn (Q4). Note that Q3 FY26 reported EBITDA is stated as 600 Mn including other income.

Q1 FY27 three-column P&L (₹ Mn) [Fact: Q1 FY27 investor presentation]

Balance Sheet, Cash Flow & Ratios

Balance sheet summary

FY23 fixed-asset jump reflects TMML consolidation. FY26 cash of ₹1,164 Cr (AR cash flow statement) holds the preferential proceeds before the June close. FY25/FY26 inventory and receivable values come from layout-extracted AR text and carry an Est. tag; FY22–FY24 values were not extracted (see the days below). n.d. = not disclosed in Q1 materials. The 30-Jun debt figure is from CFO Ravi Joshi (Q1 call).

Post-closing debt bridge [Fact unless tagged]

Cash flow and earnings conversion

*FY22–FY24 from Screener. Screener shows 10 values against 12 year columns, so these are aligned on the assumption that the last 10 cover FY17–FY26 [Est.]. Screener's "FCF" row equals CFO and omits capex, so it was not used. FY25/FY26 CFO and capex come from the FY26 AR consolidated cash flow statement; capex columns were read from layout-extracted text [Est. alignment].

Working-capital and return ratios

The ROCE row on Screener has 11 values against 12 years, so FY22–FY25 are shown as ranges. FY22–FY25 ROE is computed as PAT ÷ year-end net worth [Est.]; FY26 5.9% is Screener's (average equity). On year-end net worth FY26 ROE would be ~4.2%. Management targets a consolidated ROE of 18% "post-acquisition" (Sep-25), against 5.9% in FY26.

Capex plan

• FY27: Tega ~US$40 mn including Chile (~US$25–30 mn total project; ₹50–60 Cr p.a. sustaining). Molycop ~US$28 mn for the 10 months, normalised in the "low US$30s mn" p.a. (2–3% of revenue). CRISIL models combined capex of ₹500–650 Cr p.a. including hi-chrome expansion.
• Molycop gross block is ~US$700 mn, with depreciation ~US$60 mn p.a. before purchase-price-allocation amortisation.

Credit rating and lenders

CRISIL facilities: ₹1,500 Cr term loan (Standard Chartered); ₹221 Cr cash credit (Axis 20, StanChart 55, DBS 35, RBL 24, ICICI 40, Citi 47); ₹50 Cr LC/BG; ₹225 Cr proposed WC. FY26 standalone/legacy: net D/E 0.09x, finance cost down 16% to ₹22.6 Cr.

Equity dilution and share count

Share count up 14% since listing, almost all from the Nov-25 preferential. At CMP a further ₹2,000 Cr raise would mean ~1.05 Cr new shares, about 14% more dilution [Est.].

Key balance-sheet risks

• Goodwill of ~₹5,000 Cr against a pre-deal net worth of ₹3,407 Cr. Any Molycop shortfall becomes an impairment test. There is already a standalone key audit matter on Tega Holdings Pte (₹450 Cr carrying value above its net worth).
• The cumulative preference coupon and the US$120 mn earn-out sit senior to common equity.
• FX: 80–85% of sales are in foreign currency. Molycop hedges, and FX "has not had a material impact". Parent INR debt is serviced from USD dividends, which creates translation and upstreaming risk.
• Molycop's ABL swings with bar purchases (bar ≈80% of COGS), so working-capital debt is seasonal.

Management, Promoters & Governance

Promoters

Key management

Board of directors (7)

Independence 4/7 (57%), one woman director. FY26 attendance: IDs 95.45%, board 97.40%. Independent directors were paid ₹15–25 lakh commission each. On 13 Aug 2026 the board approved re-appointing Ashwani Maheshwari for a second five-year term (Apr 2027–Mar 2032), subject to shareholder approval [Fact: NSE Reg 30 intimation, 13 Aug 2026]. The board has no Apollo nominee at listed-company level (Apollo's governance rights sit at the Molycop HoldCo; details not disclosed).

Shareholding trend (%)

The Sep-25 swing (DII 18.38→10.74, public 5.07→12.58) reverses in Dec-25, which suggests a classification change rather than real selling [Est.]. Dec-25 promoter dilution came from the preferential issue. History: 85.17% pre-IPO, 79.17% (Mar-22), 74.78% (Mar-24, after promoters sold 27.25 lakh shares in the open market for minimum public shareholding compliance).

>5% holders (31 Mar 2026): Nihal Fiscal Services Pvt Ltd 49.88%; M M Business Trust 9.69%; Madan Mohan Mohanka 7.32%; Tata Small Cap Fund 5.58%; HDFC Small Cap Fund 5.42%. Promoter pledge: NIL [Fact].

TA Associates: entry and exit [Fact: FY22 AR, Venture Intelligence, Avendus]

Wagner Ltd, an affiliate of TA Associates, invested in Apr–May 2011 (about US$35 mn per Avendus, the adviser). It received 76,893 equity shares plus 6,68,637 compulsorily convertible participatory preference shares, which became 9,99,609 equity and 86,92,281 CCPP after a 12:1 bonus in Oct 2013. The 2011 shareholders' agreement gave Wagner a put option on the promoters if no IPO happened. The CCPP converted in Nov 2021, and Wagner sold all 96,91,890 shares in the Dec-2021 IPO OFS for ₹439.0 Cr, a full exit at ₹453. The IPO (₹619.2 Cr, pure OFS, subscribed 219x) listed on 13 Dec 2021 at ₹760, a 68% premium. Tega received no IPO proceeds.

Insider / SAST activity

• FY24: Mehul Mohanka and Nihal Fiscal sold 27,24,950 shares in the open market (minimum public shareholding compliance). Marudhar Food & Credit merged into Nihal Fiscal (NCLT, 14 Jun 2023).
• FY26: promoters subscribed to the ₹1,994 preferential. Management guided ₹150–200 Cr of family participation; Nihal Fiscal's holding rose to 3.747 Cr shares from 3.713 Cr. The exact promoter subscription amount is not extracted [Gap]. Manish Mohanka's stake moved to MM Mohanka (intra-family).
• Oct 2026: preferential to AP Jupiter Holdings II, Ltd. (non-promoter, ₹95.4 Cr). The FY26 AR names "AP Jupiter Holdco (SG) Pte Ltd" as the Apollo HoldCo, so this allottee is very likely an Apollo vehicle, giving Apollo a small listed-company stake (~0.6%) [Analyst View].

Related parties, auditor, legal

• RPTs: all in the ordinary course and at arm's length. No material RPTs and no AOC-2 filing (AR FY26). Main flows are intra-group (subsidiaries, Hosch Equipment India JV dividend ₹4.9 Cr) plus KMP pay. RPT policy amended 15 May 2025.
• Auditor: Walker Chandiok & Co LLP (Grant Thornton Bharat), appointed at the 48th AGM (2024) for five years. It succeeded Price Waterhouse & Co Bangalore LLP, which was appointed at the 44th AGM (Oct 2020) for a term to the 49th AGM (2025), so PwC left about a year before its term ended. The reason is not stated in the filings reviewed [flag]. FY26 opinion unmodified, with no fraud reported under s.143(12). Key audit matter: impairment test on the ₹450.4 Cr investment in Tega Holdings Pte (Singapore), whose carrying value exceeds its net worth. Subsidiary auditors: SNG Grant Thornton (South Africa), Grant Thornton Chile.
• Contingent liabilities: immaterial (FY26 standalone income tax ₹8.4 Cr, GST ₹0.6 Cr, service tax ₹0.1 Cr). Corporate guarantee to TMML limit ₹120 Cr; SBLCs for Chile (US$2.0 mn) and Tega Holdings (US$2.9 mn).
• SEBI / regulatory: no SEBI orders or MCA actions found in filings or rating rationales reviewed [searched: AR FY26 secretarial audit, CRISIL].

Subsidiaries and group structure

Acquisition track record

Supply Chain

↑ Upstream: what Tega depends on

Import dependence for Indian plants is not quantified in the filings reviewed. Single-source risk appears low: multiple plants per product, and Molycop sources bar from several regional mills [Analyst View].

↓ Downstream: who depends on Tega

• Concentration: no single customer ≥10% of group revenue (FY25, FY26). Latest top-customer shares are not disclosed. The RHP (2021) gave top-10 at 29.19% on a three-year average (FY19 22.51%, FY20 31.31%, FY21 32.62%, Q1 FY22 34.19%), top-20 at 42.11% and top-50 at 65.30% [Fact: RHP]. Post-Molycop concentration is unknown. Molycop lost "two major customers" in 2023–24 when their mines closed (Cobre Panama, care-and-maintenance from late 2023; Grasberg disrupted by the 25 Sep 2025 mud rush), which shows mine-level concentration risk [Analyst View on mine identities].
• Contract tenors: Molycop runs multi-year supply contracts with steel-index formulas; tenors not disclosed. Tega liners are order-by-order with a 3–6 month lead time. The order book is ₹1,231 Cr (Jun-26), with ~₹960 Cr executable within 12 months.
• End-products: refined copper (grids, EVs, data centres), gold (investment, central banks), iron ore (steel).

Value-chain map

Competitive Position

Market position

• Mill liners: Tega is the second-largest producer of polymer-based mill liners globally by CY2020 revenue (Frost & Sullivan, cited in RHP) [Fact: RHP]. The global mill-liner market was US$1.73 bn in 2020: metallic US$971 mn, composite US$451 mn, rubber US$312 mn. It is forecast to grow at a 5.8% CAGR to 2030, with composite growing fastest at 8.4%. The top 5 held 49%: Metso Outotec, ME Elecmetal, Bradken, PT Growth and Tega. The hydrocyclone market was US$671 mn (Weir, FLSmidth, Metso lead). The trommel-screen market was US$0.94 bn, with Multotec, Sandvik, FLSmidth and Metso at ~85%.
• Grinding media: Molycop is a global leader in forged media with >50% share in its core regions (Molycop COO, Aug-26) and a "clear leading position" in large SAG balls [Fact: management claim]. CRISIL calls the combined group "the world's largest player in critical-to-operate mining consumables" [Fact: CRISIL wording].
• Market sizes: management cites blended gold and copper growth of ~3% CAGR to FY30. UNCTAD sees copper demand +40% by 2040, needing ~US$250 bn of investment and ~80 new mines (one transcript says 18; 80 is the figure in the Jun-26 call). Global mining market ~US$2.16 tn (CY26, AR).

Peer comparison (12 Oct 2026; peers from stockanalysis.com and Screener.in)

AIA EV/EBITDA = (mcap ₹35,093 Cr − investments ₹4,302 Cr) ÷ FY26 operating profit ₹1,261 Cr. Private peers (Magotteaux/Sigdo Koppers, ME Elecmetal, Polycorp, Multotec, Trelleborg mining) are not covered: no verified data this session. Tega's trailing P/E is not meaningful after the Q1 loss (stockanalysis shows 688x).

Strengths and weaknesses vs each peer [Analyst View]

Industry structure and Porter's five forces

Risks & Red Flags

Concall Highlights & Guidance

Management in their own words

Analyst Q&A that reveals risk

• Varun Jain (Dolat): "Even the past 3 years, management keeps guiding 15%, but consistently Consumable segment has been weaker." Management replied it was "cyclicality" and kept the 15%+ guide.
• Deepak (Sundaram MF): "The commentary was similar in the last 2 quarters also… that the order will come in, in the next quarter."
• Kirtan Mehta (Baroda BNP): AIP bought Molycop at ~US$1.2 bn EV (~2017) and sold at ~US$1.5 bn eight years later, so what went wrong? Management replied AIP's fund was at end of life and its IRR was likely 13–14%.
• Saurabh Ginodia (SMIFS): Molycop's EBITDA-to-PAT conversion was "almost flat" in FY25 after interest and depreciation.
• Renjith (Mahindra Manulife): "Why are the margins at 11% while AIA Engineering is at 23%?" Management: normalised ~15% excluding lost customers.
• Varun Jain: an analyst reported that a Dec-25 TV interview had Molycop growth at 7–8%, versus 3% given in Jun-26. Management said it had "never given such guidance" and blamed mine-restart deferral.

Guidance vs. outcome (credibility ledger)

Tone over time: confident (FY25) → expansive (deal) → cautious (Feb-26) → defensive (Jun-26) → upbeat but hedged (Aug-26). Recurring themes: 15% CAGR, "timing" of orders, logistics, Chile. Contradictions: one-off totals, the stake (77% → 84.18%), the Molycop growth outlook, and the leverage target.

Growth, Outlook & Valuation

Revenue visibility

Expansion and catalysts

Guidance summary

Valuation

The stockanalysis EV of ₹12,376 Cr (EV/EBITDA 33x) is stale: it uses the FY26 balance sheet with parked cash and excludes Molycop debt. Do not use it.

Multiples vs history and peers

A precise 3-year average P/E and EV/EBITDA history was not retrievable without paid data [Gap]. Ranges are computed from reported EPS and the 52-week and 3-year price range.

Scenario targets (12–18 months) [Est.]

Sell-side: 4 analysts, average target ₹1,799 ("Hold") per stockanalysis.com. A Simply Wall St consensus of ₹1,914 (range ₹1,714–2,030) is undated. Named brokerages are not verified [Gap]. Equity value is highly geared to EBITDA because of the leverage: each 1x turn of multiple ≈ ₹320/share.

Final Verdict

Five things to remember

1. Tega is now ~85–90% a grinding-media company. Analyse it as Molycop plus a high-margin liner business.
2. Company "EBITDA" includes other income. FY26 other income was inflated by parked preferential-issue proceeds that are now deployed.
3. Group debt is ₹11,200 Cr including ~₹2,600 Cr of Apollo preference shares, plus a US$120 mn earn-out due FY28.
4. Q1 FY27: legacy operating EBITDA +36% YoY; Molycop June adj. PAT was only ₹10 Cr on ₹1,292 Cr of revenue.
5. Promoters are the Mohanka family (nil pledge). TA Associates exited fully in the 2021 IPO. Apollo is now the key financial partner at the Molycop level.

Five questions to ask before investing

1. What is the coupon, dividend policy and redemption mechanics of Apollo's ~US$270 mn preference shares, and how much of June's ₹97 Cr Molycop finance cost is recurring?
2. How much equity will be raised under the ₹4,000 Cr enabling resolution, at what price, and when?
3. What are Molycop's quarterly volume, EBITDA per ton and hi-chrome mix, and how much revenue is at risk from Chinese forged media in LatAm?
4. Why did three CFOs serve in a year, and what controls cover a 26-plant multinational now consolidated from Kolkata?
5. What is the final purchase price allocation (intangible amortisation versus goodwill), and what are the exact conditions for the US$120 mn earn-out?

Sources

Company filings and reports

• FY26 Annual Report (BSE): bseindia.com …044b03ab….pdf (segments, footprint, board, auditor, shareholders, cash flow, Molycop note 47)
• FY24 Annual Report (BSE): …2c142aed….pdf (minimum public shareholding sale, ESOP)
• FY22 Annual Report (BSE): …74888543413.pdf (IPO OFS split, Wagner CCPP conversion, listing price)
• Press release, definitive agreement and ₹1,713 Cr preferential, 29 Nov 2025: tegaindustries.com
• Q1 FY27 investor presentation (13 Aug 2026): BSE
• Q4 FY26 investor presentation (May 2026): BSE · Q3 FY26 PPT: BSE
• In-principle approval, 4,78,435 preferential shares (6 Oct 2026): BSE
• 50th AGM voting results (25 Sep 2026): BSE
• RHP (Dec 2021, SEBI): read per research notes (SEBI attachdocs file 1681882986314.pdf; path not re-verified at review) for F&S polymer-liner rank, mill-liner/hydrocyclone/trommel market sizes, top-10/20/50 customer shares and repeat-order %. DRHP listing page: sebi.gov.in

Concall transcripts (BSE)

• Q1 FY27, 13 Aug 2026: transcript
• Q4 FY26, 2 Jun 2026: transcript
• Q3 FY26, Feb 2026: transcript
• Q2 FY26, Nov 2025: transcript
• Molycop deal call, 12 Sep 2025: transcript
• Q1 FY26, Aug 2025: transcript
• Q4 FY25, May 2025: transcript

Financial databases and market data

• Screener.in, Tega consolidated: screener.in/company/TEGA/consolidated (price, P&L, BS, CF, ratios, shareholding)
• Screener.in, AIA Engineering: link
• stockanalysis.com: TEGA · Weir · Metso · FLSmidth

Credit ratings

• CRISIL rationale, 14 May 2026: crisil.com
• ICRA, 19 May 2026: icra.in (did not render; listed for completeness)
• Earlier CRISIL actions: 18 Mar 2026, 18 Dec 2025, 19 Sep 2025, 3 Jul 2025 (links via Screener documents tab)

News and secondary

• FilingReader, Molycop completion summary (1 Jun 2026): link
• FilingReader, term-sheet call summary (13 Sep 2025): link
• NSE, Reg 30 intimation, re-appointment of Ashwani Maheshwari (13 Aug 2026): nsearchives.nseindia.com · investywise summary
• Sahi, TMML ₹126 Cr contract with Kalpataru Projects (21 Sep 2026): link
• Sahi, AP Jupiter preferential (22 Aug 2026): link
• Venture Intelligence, IPO anchor book (1 Dec 2021): link
• Avendus, TA Associates investment (2011): link
• Molycop news release on the Tega and Apollo consortium: molycop.com (listed, not re-read)
• Simply Wall St narrative (consensus range): link (undated)

Known data gaps

• Apollo preference-share coupon and terms; ICRA rationale text; Molycop standalone audited financials (beyond figures given on calls).
• Named customers, top-5/top-10 concentration; supplier names; plant capacities for Tega's plants.
• FY22–FY24 capex from audited cash flows (Screener alignment unreliable); 3-year historical average P/E and EV/EBITDA.
• Exact promoter subscription in the Nov-25 preferential; full certification list; named brokerage targets.
• Private peers (Magotteaux, ME Elecmetal, Polycorp, Multotec) financials.