Gala Precision Chennai Phase 1 nears Rs 60 crore capacity

Gala Precision Engineering Limited said on November 6, 2026 that its Chennai Phase 1 fastener plant was running almost at its Rs 60 crore annual capacity, supported by a Rs 15 crore revenue target for Q3 FY27. Management expects Phase 2 to add about Rs 50 crore of capacity and lift Chennai’s combined annual capacity to Rs 110 crore.

How close is Gala Precision’s Chennai Phase 1 to full capacity?

Gala Precision said Chennai Phase 1 was operating almost at its Rs 60 crore annual capacity on the November 6 call. Management quantified Phase 1 capacity at Rs 5 crore per month and said it was targeting approximately Rs 15 crore of Chennai revenue in Q3 FY27, equivalent to three months at that monthly run rate.

Management did not describe Phase 1 as completely full because some Phase 2 equipment could become operational by the end of November 2026. However, its statement that Phase 1 was running “almost” at capacity means the original line has limited further room, while the next material increase in Chennai output depends on the incremental Phase 2 machines.

The plant has ramped quickly since commencing operations in August 2025. Chennai generated Rs 22 crore of revenue in H1 FY27, compared with Rs 64 lakh in H1 of the prior year, when the facility had operated for only two months. Management also said one good fastener order was shifted from Wada to Chennai after the Chennai operation became ready, so part of Chennai’s reported increase reflects production reallocation within the network.

When will Gala Precision’s Chennai Phase 2 begin contributing?

Gala Precision said Phase 2 was expected to be operational by January 2027, although part of the equipment could contribute in November or December 2026. Management said the full incremental capacity of approximately Rs 50 crore would be available in Q4 FY27, raising Chennai’s annual capacity from Rs 60 crore to Rs 110 crore.

The Phase 2 ramp should not require separate customer approvals, according to management, because the Chennai stud and bolt facility has already been approved. Management described Phase 2 as incremental capacity within an approved plant rather than a new product or facility requiring a fresh qualification process.

Subject to order flow, management said it should be able to start using the additional capacity within 15 days to one month after commissioning. This is an operational expectation rather than a fixed sales commitment: the company said it would gain greater clarity once particular Phase 2 machines started, and any Q4 FY27 revenue contribution will depend on the commissioning date and customer orders.

Management had previously referred to 70% Chennai utilisation, but said this could be slightly higher based on current order flow. For the whole of FY28, its stated expectation is for Chennai to use about 80% to 90% of capacity, which would cover the first full year with Phase 1 and Phase 2 operating together.

How much of Gala Precision’s H1 FY27 growth came from Chennai?

Gala Precision said company sales increased from about Rs 134 crore to Rs 135 crore in H1 of the previous year to approximately Rs 170 crore in H1 FY27. That represents growth of roughly Rs 35 crore, while Chennai revenue increased by about Rs 21.36 crore, from Rs 64 lakh to Rs 22 crore, over the same comparison.

Management said Chennai accounted for Rs 22 crore of growth from a capacity perspective, with the remaining increase coming from Wada. It also said its disc spring business, manufactured entirely at Wada, grew by approximately 25% to 30%, showing that growth did not come solely from the Chennai expansion.

The Chennai project also expands the product range offered to wind customers. Management said it initially addressed part of the fastener market through studs supplied from Wada and Chennai, then added bolts after successful Chennai implementation and product approval. The company said bolts are required by wind original equipment manufacturers, particularly for tower applications.

Management also cited offshore smart-fastener exports as an addition to the wind business during the quarter. It said its share of business with most wind companies was between 5% and 25% to 30%, while its small base relative to those customers’ demand left room for further sales growth over the next one to two years.

What capacity plans follow Chennai’s Phase 2 ramp-up?

Gala Precision said current Wada capacity and Chennai Phase 2 should meet requirements in the first and second quarters of FY28. Management plans to review capacity needs in the third quarter of FY28 and is targeting readiness of a new facility by the fourth quarter of FY28, with rented space as a possible temporary arrangement if needed earlier.

For Chennai’s FY29 needs, management said it had started seeking an additional land parcel of three to five acres, or potentially five acres, near the existing plant. It said it had applied twice online to the State Industries Promotion Corporation of Tamil Nadu in the preceding two months but had not secured a plot, and was also examining private-channel options.

Management has identified a backup plan if a land purchase takes longer. It said it had shortlisted long-lease premises that could house the stud facility, allowing bolt capacity to be added at its own Chennai premises. The company said it did not see a major immediate Chennai expansion constraint, although its FY29 route depends on either a land acquisition or a lease arrangement.

The wider capacity plan includes disc spring as well as fastener operations. Management said it was debottlenecking disc spring processes in the existing space, considering outsourcing machining or heat treatment, and planning to add both disc spring and fastener capacity at the proposed new facility in FY28.

Conclusion

Gala Precision’s Chennai operation has progressed from an August 2025 start-up to a plant running almost at its Rs 60 crore Phase 1 annual capacity in Q3 FY27. Its Rs 22 crore H1 FY27 Chennai revenue, compared with Rs 64 lakh a year earlier, demonstrates the unit’s growing contribution, while the Rs 50 crore Phase 2 addition would take combined annual capacity to Rs 110 crore.

The next milestones are the expected January 2027 Phase 2 operational date, the speed at which orders fill the new capacity, and management’s 80% to 90% Chennai utilisation expectation for FY28. Beyond that, investors can watch the FY28 third-quarter capacity review and whether Gala Precision obtains a three-to-five-acre Chennai land parcel or implements its long-lease backup for FY29 expansion.