Kranti Industries Limited , a precision machining company, has made a significant stride into the defence manufacturing sector by securing 12 purchase orders worth approximately ₹47 lakh from Armoured Vehicles Nigam Limited-Machine Tool Prototype Factory (AVNL-MTPF). This development marks the company's maiden entry into defence manufacturing and represents a strategic milestone in its diversification roadmap.

Key Highlights

• Kranti Industries received 12 purchase orders from AVNL-MTPF, a Defence Public Sector Undertaking.
• The orders, valued at ₹47 lakh, are for machining precision components for defence applications.
• This marks Kranti's first entry into the Defence and Public Sector Unit ecosystem.
• The company aims to strengthen long-term opportunities in high-value, critical precision engineering segments.

Financial Context

To provide context for this new development, let's look at Kranti Industries' recent financial performance:

The company has shown improvement in its financial performance in the most recent quarter, with significant growth in operating profit and net profit. The positive EPS in Q2 FY2026 indicates a turnaround from the loss in the previous quarter.

Strategic Implications

1. Diversification: The entry into defence manufacturing aligns with Kranti Industries' strategy to diversify into high-margin precision engineering applications.

2. Potential for Growth: The defence sector in India is experiencing increased domestic procurement, which could provide sustained growth opportunities for Kranti Industries.

3. Technological Capabilities: Securing orders from a defence PSU validates Kranti's technical capabilities and quality systems, potentially opening doors for more contracts in this sector.

4. Revenue Stability: Defence contracts often provide more stable and long-term revenue streams, which could help in smoothing out cyclical fluctuations in other business segments.

While the initial order value of ₹47 lakh may seem modest compared to the company's quarterly revenue of ₹23.40 crore, it represents a strategic entry point into a new, high-potential sector. The success in executing these orders could lead to larger contracts in the future, contributing more significantly to the company's top and bottom lines.

As Kranti Industries embarks on this new venture in the defence sector, investors and industry observers will be keenly watching how this strategic move impacts the company's future growth trajectory and financial performance.

Kranti Industries Limited has reported robust financial performance for Q2, showcasing significant growth across key metrics. The company has also announced a strategic alliance with Universal Autofoundry Limited, marking a significant step in its expansion plans.

Financial Highlights

Kranti Industries demonstrated strong financial performance in Q2:

The company's total income for H1 reached ₹42.27 crores, reflecting a solid 14.6% growth compared to the previous year's H1.

Strategic Alliance with Universal Autofoundry

Kranti Industries has signed a Memorandum of Understanding (MOU) with Universal Autofoundry Limited for a long-term machining alliance in Rajasthan. Key points of this partnership include:

• Seven-year agreement starting January 2026
• Focus on integrated manufacturing for automotive and engineering sectors
• Addition of 48 machines to Kranti's operations in Jaipur
• Expected to contribute ₹4-4.5 crores in monthly revenue

Operational Highlights

• Current monthly sales revenue rate: ₹8-8.5 crores
• Capacity utilization in Pune facility: 65-68%, expected to reach 75-78% by fiscal year-end
• Jaipur facility (post-alliance) initial capacity utilization: 50-55%
• EBITDA margin expected to stabilize at 16.5-17% in the long run

Future Outlook

• Focus on non-automotive and export sectors for higher margins
• Expansion into electric vehicle (EV) components manufacturing
• New purchase order from Ingersoll-Rand US for housing components
• Clearance to begin series production of EV components for Eka Mobility

Sachin Subhash Vora, Chairman & Managing Director, commented, "Our Q2 and H1 results reflect strong revenue growth along with significant improvements in profitability and operational efficiency. These results position us well for continued success and sustained momentum in the coming quarters."

The company aims to maintain double-digit growth annually for the next three years, focusing on product diversification, geographic expansion, and operational efficiency.

Kranti Industries continues to strengthen its position in the auto component manufacturing sector, with a clear strategy to capitalize on emerging opportunities in the EV and non-automotive segments while maintaining a strong foothold in its traditional markets.