Analysis: Salasar Techno Engineering Limited

Growth thesis

Salasar Techno Engineering manufactures steel towers, power transmission structures, railway electrification systems, and heavy steel structures. Key segments include telecom towers (domestic/international), power monopoles, railway electrification EPC, and heavy-steel bridges. Growth hinges on new UP galvanizing plant (200,000 tpa, operational Q2 FY24) and Bhilai heavy-steel plant (25,000 tpa, Q4 FY24), which should unlock premium-margin monopoles and railway projects. Order book of ₹1,435 cr (18–24 months coverage) includes ₹750 cr rural electrification and ₹380 cr railway electrification, with EBITDA margin guidance of 10–11% (currently 8–9% due to commodity volatility). Execution risks center on delayed plant ramp-ups and margin expansion, as past capex timelines (e.g., UP plant pushed from Q4 FY23 to Q2 FY24) and margin targets have consistently lagged.

Why is Salasar Techno Engineering Limited stock rising?

• Commissioning of new state-of-the-art galvanization plant to manufacture high-voltage transmission monopoles (400 kV and above), reducing competition and improving margins.
• Expect additional revenue of at least INR50 crores in the current fiscal year from the new galvanization plant.
• Monopoles for power transmission identified as a major growth area with design and manufacturing edge.
• Rural electrification: targeting opportunities from the government's INR25,000 crore outlay for distribution sector.
• Railway electrification: pursuing projects from the government's INR1.07 lakh crore capex for railways.

Research report

companyname: Salasar Techno Engineering Limited ticker: SALASAR sector: Infrastructure / Engineering / Steel Structures Salasar Techno Engineering Limited began operations in 2006-07 and has been in business for over 15 years. It is a one-stop infrastructure solution company providing 360-degree solutions across continents, including design, manufacturing, and EPC execution. The company operates three state-of-the-art manufacturing facilities in Uttar Pradesh with a total installed capacity of ...

Catalysts

capex, margin expansion, geographic expansion

Growth guidance

Revenue Growth: 20-25% for FY23; 15-20% for FY24

Management consistency

mixed