Azad's order book is 11-12x revenue. Mitsubishi just signed up for eight more years.
A single-source contract on a component only three companies globally can make. The defence and aerospace supplier now has visibility for years.
What's new
- Azad locked in an eight-year, single-source contract with Mitsubishi Heavy Industries for hot-section nozzle vanes.
- Delivery of the first HTT engine for a national defence programme is imminent.
- FY27 guidance is for at least 25% revenue growth with 33-35% EBITDA margins.
Why this matters
The Mitsubishi deal is the real news. Eight years of guaranteed revenue on a component only three factories on Earth can produce is the kind of visibility that reshapes a company's growth profile. Combined with a ₹6,500 cr backlog, management is effectively selling growth it has already booked.
What we're watching
- The first HTT engine shipment, which would mark a major defence milestone.
- Rolls-Royce airfoil qualifications converting to commercial production in late FY27.
- Whether the 33-35% EBITDA margin guide holds as new facilities ramp.
The full read
Azad Engineering's Q4 earnings call was a platform for news that overshadows the quarterly numbers. The company landed an eight-year, single-source contract from Mitsubishi Heavy Industries for hot-section nozzle vanes. These are among the most engineered components in a gas-turbine engine. Only three shops globally make them. Azad just secured one of them for the better part of a decade. The financials support the story. Revenue grew 30% to ₹590 cr in FY26, net profit surged 54% to ₹132 cr. More importantly, the company now sits on an order book of ₹6,500 cr, equal to 11-12 times its annual revenue. Management is guiding for 25%+ top-line growth in FY27 with 33-35% EBITDA margins. Two other catalysts are lining up: the imminent shipment of the first HTT engine for a national defence programme, and Rolls-Royce airfoil qualifications targeting commercial production in late FY27. The concall summary covered the basics. The full transcript confirms a business with a transformed growth profile.
Questions answered
- Why is the Mitsubishi contract so significant?
- It is an eight-year, single-source agreement for hot-section nozzle vanes, a critical component in gas-turbine engines. The company said only three manufacturers globally can produce these parts, giving Azad a protected, long-term revenue stream.
- What does the 11-12x order book mean for near-term growth?
- With ₹6,500 cr in backlog against ₹590 cr in FY26 revenue, Azad has already secured over a decade's worth of its current annual sales. This removes near-term demand risk and underpins the 25%+ growth guide.
- What is the status of the HTT engine programme?
- Management said delivery of the first HTT engine for a national defence programme is imminent. No exact date was given, but the language shifted from 'in development' to a much firmer timeline.
- How did FY26 earnings look?
- Revenue grew 30% to ₹590 cr and net profit jumped 54% to ₹132 cr. The strong earnings provide a solid base for the FY27 growth targets.