Sigma Advanced Systems has begun production at its new aerospace manufacturing facility in Sri City, Andhra Pradesh. The company completed the transition from groundbreaking to active operations in eight months. Co-CEO Sunil Kalidindi stated the facility is central to global manufacturing strategy and the company aims for double-digit EBITDA growth.

The initial phase involves a 75,000 sq ft operational area within a larger 500,000 sq ft campus. This first batch of precision-machined aerospace components has been manufactured and shipped to Sigma UK for final verification. The facility currently offers 100,000 annual machining hours of capacity.

Operational Scale and Capability

The Sri City operation is designed to replicate the manufacturing capabilities of Sigma’s UK subsidiaries, Nasmyth and Bromford. The company has completed the initial stages of the source-change approval process with Rolls-Royce Aerospace.

Sunil Kalidindi, Chief Executive Officer and Executive Director, stated that the objective is to progressively bring a larger part of the aerospace manufacturing value chain into India. The remaining campus is expected to become operational in the next 12 months, adding further aerospace-critical processes.

What the Numbers Show

The rapid deployment of 100,000 machining hours within an eight-month build-out period highlights the efficiency of the greenfield project execution. With the facility budgeted to scale to nearly 300,000 AMH, the current capacity represents approximately one-third of the immediate target, indicating significant near-term upside in utilization rates as NADCAP accreditation progresses.

Strategic Outlook

Sigma expects the Sri City operation to employ more than 500 people over the next two to three years. The location was selected for its connectivity to four major ports, supporting export-oriented operations. The company plans to develop specialized aerospace manufacturing skills through on-campus training.

This facility forms part of a broader strategy to establish a multi-site aerospace manufacturing footprint across India and the UK. Once fully operational, approximately 70% of the manufacturing process is expected to be undertaken in India.

Sigma Advanced Systems has secured a long-term agreement worth £125m (approximately ₹1,600 crore) from Rolls-Royce Aerospace UK for manufacturing aeroengine rings, casings, lock plates, and other critical engine structures at its India and UK manufacturing facilities.

The contract was disclosed to exchanges on 25 August 2026 and is classified as a Mega order. The scope covers manufacturing at Sigma Advanced Systems' facilities in both India and the United Kingdom.

Order details

The long-term agreement with Rolls-Royce Aerospace UK is valued at £125m (approximately ₹1,600 crore). The contract covers the manufacture of aeroengine rings, casings, lock plates, and other critical engine structures. Production is to be carried out across Sigma Advanced Systems' India and UK manufacturing facilities.

This is the second disclosed agreement between Sigma Advanced Systems and a Rolls-Royce entity. An earlier contract, also classified as Mega and valued at ₹3,800 crore, was disclosed in April 2026 and covers the manufacture and supply of a wide portfolio of high-precision-engineered, safety-critical components and assemblies for Rolls-Royce's aerospace programs.

Order history

The table below captures all orders disclosed by Sigma Advanced Systems in exchange filings over the last three fiscal quarters, including the latest contract.

Order in financial context

The ₹1,600 crore order represents approximately 657.3% of the company's average quarterly revenue of ₹243.45 crore. The total disclosed order book stands at ₹9,398.00 crore across 8 orders, as per pre-computed exchange filing data. This provides coverage of 38.60 quarters of average quarterly revenue, equivalent to 9.65 years of annual revenue at the current run-rate. Trailing twelve-month revenue stands at ₹973.8 crore.

The company has received orders from multiple entity types: international aerospace clients, including Rolls-Royce and Rolls-Royce Aerospace UK, and domestic government bodies, including the Home Ministry, Government of India.

Company order track record

The pre-computed quarterly order summary below reflects exchange-disclosed data for the last three fiscal quarters.

Execution and revenue quality

Recent quarterly performance shows improving profitability. Q1FY27 reported revenue of ₹379.20 crore with an operating profit margin (OPM) of 15.85%, compared with negative margins in earlier periods.

Revenue growth: order wins translating to revenue

As Sigma Advanced Systems has accelerated order wins, particularly in FY26, its annual revenue has grown from ₹41.60 crore in FY25 to ₹491.88 crore in FY26, representing a year-on-year growth of +1082.4% based on the latest annual data.

Working capital and execution capacity

The balance sheet supports execution with a current ratio of 1.42x and total liabilities/equity of 1.26x. Operating cashflow has been positive over the last four years, with ₹36.70 crore generated in FY25. Free cashflow remained positive at ₹19.40 crore in FY25.

What to watch

• Execution rate: With a backlog covering 38.60 quarters of revenue, the ability to scale production and deliver on time across both India and UK facilities is a key operational consideration.
• OPM trajectory: Monitor whether the OPM of 15.85% seen in Q1FY27 sustains as new orders execute. Margin quality may vary between domestic defense contracts and international aerospace components.
• Client concentration: The majority of the disclosed order book comes from Rolls-Royce entities and North American customers. The Home Ministry, Government of India order adds domestic government exposure.
• Working capital cycle: As orders execute, monitor receivables days and cash conversion cycles to ensure liquidity remains adequate for scaling operations across multiple geographies.

Key observations

• Backlog signal: The total disclosed order book of ₹9,398.00 crore covers 38.60 quarters of average quarterly revenue. At this level, execution capacity is a primary operational factor.
• Valuation check (as of 25 Aug 2026): P/E of 78.2x against ROCE of 9.01%. Price-based metrics are as of 25 Aug 2026 and will change; ROCE is from audited financials.
• Margin stress: Net loss of ₹1.00 crore in Q3FY26; execution stress was visible in quarterly data prior to the recent recovery seen in Q4FY26 and Q1FY27.