MSTC Limited
Q1 FY26
Call date · August 14, 2025

1 · Management Commentary

Key Positives

  • Revenue increased ~12% YoY in Q1 FY26, driven by strong e-commerce segment performance.
  • E-auctions, mineral block auctions, property auctions, FM spectrum auctions, and coal/iron ore auctions contributed significantly.
  • Coal India auctions, absent in FY25, have resumed and are expected to supplement revenues.
  • Renewal of the defence scrap disposal agreement, a long-standing relationship since 1982.
  • Launch of the Upkaran portal for OEMs and equipment dealers, with promising initial industry response.

Key Negatives

  • Scrap rates have fallen during the quarter, though higher transaction volumes offset the impact.
  • MMRPL (Mahindra JV) continues to report losses; breakeven is not expected before Q4 FY26.
  • Revenue from FM channel auctions is minimal.
  • New data center in Delhi is delayed; operationalization expected in 4–5 months.

Forward Guidance

  • Capex will focus on software upgrades, hardware, and data center infrastructure; exact figures to be finalized post Q2/Q3.
  • Continued thrust on developing software applications and collaborative models, especially for government and private sector digitization.
  • Upkaran portal onboarding ongoing; monetization model to be finalized in the next 2–3 months.
  • Exploring new exchange platforms (coal, minerals, EPR, credits) as policy frameworks evolve.
  • Strategic focus on expanding private sector business, especially among SMEs, with new business models tailored to their needs.
  • Expectation of steady, not exponential, growth in e-commerce revenues.

2 · Q&A Highlights

Q 1 (Composite): What is the scope and revenue potential of the new software application initiatives?
A (Management):
• Early-stage, focused on small ERP and integration tools for ministries/industry; potential is promising but too early to quantify.

Q 2 (Composite): What steps are being taken to increase private sector business and how will the model differ?
A (Management):
• Building listing-based platforms for quick transactions, targeting SMEs; revenue streams and models will differ from government business.

Q 3 (Composite): When will new initiatives reflect in significant e-commerce revenue growth?
A (Management):
• Growth will be steady, not exponential; Q1 improvement expected to continue at a similar pace.

Q 4 (Composite): What is the annual capex requirement and capital allocation policy?
A (Management):
• Asset-light model; capex mainly for IT upgrades and data centers; allocation to be finalized after ongoing project assessments.

Q 5 (Composite): What are the revenues from FM channel and Coal India auctions?
A (Management):
• FM channel auction revenue is minimal (in thousands per license); Coal India auctions contributed ~INR 4 crores in Q1.

Q 6 (Composite): What is the status and monetization plan for the Upkaran portal?
A (Management):
• Portal launched and onboarding OEMs; monetization via transaction fees to be finalized after initial transactions in 2–3 months.

Q 7 (Composite): What is the revenue mix between government and private sector? Are projects underpriced?
A (Management):
• 85–90% of revenue from government; some government projects may be underpriced for credibility, but commercial pricing is maintained elsewhere.

Q 8 (Composite): What is the status and outlook for the Mahindra JV and vehicle scrappage business?
A (Management):
• JV currently loss-making; breakeven expected not before Q4 FY26, dependent on EPR policy uptake and market clarifications.

Q 9 (Composite): What is the status of the new Delhi data center?
A (Management):
• Premises to be received this month; data center operational in 4–5 months; current operations unaffected due to existing Kolkata and Mumbai sites.

3 · Other Key Numbers

  • Total value of goods transacted through portal in Q1: INR 140.88 billion
  • Standalone PBT: INR 59.63 crores (Q1 FY25: INR 54.48 crores)
  • Standalone PAT: INR 44.32 crores (Q1 FY25: INR 40.46 crores)
  • Consolidated PBT: INR 57.65 crores (Q1 FY25: INR 53.28 crores)
  • Consolidated PAT: INR 42.34 crores (Q1 FY25: INR 39.26 crores)
  • Standalone revenue from operations: INR 77.43 crores (Q1 FY25: INR 69.04 crores)
  • Other income: INR 16.23 crores (Q1 FY25: INR 16.96 crores)
  • Total standalone revenue: INR 93.66 crores (Q1 FY25: INR 86 crores)
  • Employee benefits expense: INR 23.25 crores (Q1 FY25: INR 21.72 crores)
  • Depreciation: INR 2.25 crores (Q1 FY25: INR 2.31 crores)
  • Other expenses: INR 8.53 crores (Q1 FY25: INR 7.40 crores)
  • Standalone EPS: INR 6.30 (Q1 FY25: INR 5.75)
  • Consolidated EPS: INR 6.01 (Q1 FY25: INR 5.58)
  • E-commerce revenue: INR 70.03 crores (Q1 FY25: INR 61.55 crores)
  • Revenue from Coal India auctions in Q1: INR 4 crores
  • Revenue from scrap auctions: INR 68 crores (includes ELV auctions)
  • Share of JV loss: INR 1.98 crores
  • Finance cost: Nil
  • FM channel licenses auctioned: 63 licenses across 43 cities (revenue per license: "in thousands")
  • Government business share: 85–90% of total revenue
  • Cash and cash equivalents: Not disclosed (to be updated post September quarter)
  • New data center (Delhi): operationalization expected in 4–5 months

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