AZAD targets over ₹1,300 crore annual revenue run-rate by end FY28

AZAD expects throughput from its six commissioned customer-dedicated facilities to begin in Q3 FY27 and targets an annual revenue run-rate of over ₹1,300 crore by the end of FY28. Management expects revenue to ramp from Q4 FY27, with all six plants fully ramped by Q2 FY28.

When will AZAD's new facilities add revenue?

AZAD expects new-capacity throughput to begin in Q3 FY27, followed by a revenue ramp from Q4 FY27, while full ramp-up across all six facilities is targeted for Q2 FY28. Chairman and CEO Rakesh Chopra said each facility is at a different stage of revenue ramp-up because production is aligned with its customer's delivery plan.

Management said all six lean facilities had been commissioned by H1 FY27, including two inaugurated in September 2026 for GE Vernova Gas Power. AZAD said it had deployed treasury funds into capital expenditure, commissioned infrastructure and plants, and hired the skilled manpower required to operate the installed capacity.

AZAD also said it had built inventories of raw material, tooling and consumables to keep each facility production-ready, while running multiple customer delta qualifications simultaneously. Management described this set-up mode as mandatory for its business and said the phase was largely behind it, leaving capacity ready to convert into throughput.

The timetable separates operational activity from reported sales. Q3 FY27 is when management expects production throughput to begin, while Q4 FY27 is when it expects revenue to ramp. The over ₹1,300 crore figure is management's annual revenue run-rate target based on current installed capacity at the end of FY28, not revenue reported for a completed year.

How much dedicated manufacturing capacity has AZAD commissioned?

AZAD has commissioned 44,800 square metres of customer-dedicated capacity across six facilities at Tunikibollaram, Hyderabad, serving four global original equipment manufacturers. Two new 7,600-square-metre dedicated facilities for GE Vernova Gas Power were inaugurated in September 2026, taking GE Vernova's total dedicated facilities to three.

The presentation identifies dedicated facilities for Baker Hughes, Siemens Energy, GE Vernova Steam Power and Mitsubishi Heavy Industries, in addition to the two GE Vernova Gas Power plants. Baker Hughes has a 7,600-square-metre facility commissioned in April 2026, while Siemens Energy's 7,200-square-metre facility was commissioned in September 2025.

GE Vernova Steam Power's 7,600-square-metre facility was commissioned in April 2025 and Mitsubishi Heavy Industries' 7,200-square-metre facility in March 2025. The commissioning sequence therefore runs from March 2025 through September 2026, while the production timetable depends on customer qualifications and delivery plans.

Why did AZAD's profit growth trail its revenue growth?

AZAD's standalone H1FY27 revenue rose 29.3% year on year to ₹358.32 crore, while profit after tax increased 6.6% to ₹67.17 crore because employee costs, depreciation, finance costs and lower treasury income affected profit before new-facility revenue was fully realised. Management described this as the expected lag between investment and revenue during the set-up phase.

Reported earnings before interest, tax, depreciation and amortisation, or EBITDA, rose faster than revenue in H1FY27. EBITDA margin increased to 37.5% from 36.0% in H1FY26, but profit after tax margin fell to 18.7% from 22.7% as below-EBITDA charges and other income changed.

In Q2FY27, standalone revenue rose 31.6% year on year to ₹187.80 crore and reported EBITDA increased 37.1% to ₹70.44 crore. Profit after tax declined 6.6% to ₹30.82 crore from ₹33.00 crore in Q2FY26, with employee expenses increasing to ₹50.29 crore from ₹32.47 crore.

Depreciation and amortisation increased to ₹21.79 crore in Q2FY27 from ₹10.89 crore a year earlier, and recurring finance cost rose to ₹12.23 crore from ₹6.40 crore. Recurring other income fell to ₹4.66 crore from ₹12.72 crore. Management attributed lower treasury income to the deployment of initial public offering and qualified institutional placement funds into capital expenditure, while additional working-capital loans increased finance costs.

Which businesses are contributing to AZAD's growth?

AZAD's Energy and Oil & Gas business remained its largest segment in H1FY27, contributing 81.1% of standalone revenue and increasing 28.5% year on year to ₹290.46 crore. Aerospace & Defence contributed 16.8% of revenue and grew 28.3% to ₹60.37 crore, compared with ₹47.06 crore in H1FY26.

The revenue mix changed modestly despite segment growth. Energy and Oil & Gas represented 81.6% of H1FY26 revenue, compared with 81.1% in H1FY27, while Aerospace & Defence moved from 17.0% to 16.8%. Management said the Oil & Gas customer-specific facility, tied to customer delivery plans, provides an additional growth lever from Q4FY27 onwards.

Exports remained AZAD's main sales channel, although domestic revenue grew faster. Export revenue increased 21.1% to ₹315.29 crore in H1FY27 from ₹260.36 crore, while its contribution fell to 88.0% from 93.9%. Domestic revenue rose 155.9% to ₹43.03 crore from ₹16.82 crore, raising its contribution to 12.0% from 6.1%.

Conclusion

AZAD's H1FY27 results show revenue and EBITDA increasing ahead of profit as it carried the cost of commissioning and preparing six dedicated facilities. Standalone revenue reached ₹358.32 crore, up 29.3%, and EBITDA margin rose to 37.5%, while profit after tax margin declined to 18.7% amid higher employee, depreciation and finance costs and lower treasury income.

The next disclosed milestones are the start of throughput in Q3 FY27, the expected revenue ramp from Q4 FY27 and full plant ramp-up by Q2 FY28. Management has reiterated long-term annual revenue growth guidance of over 25% and said installed capacity positions AZAD for an annual revenue run-rate of over ₹1,300 crore by the end of FY28; customer qualifications and delivery schedules remain central to the ramp-up timeline.