Financial Performance Highlights (Q1 FY27)

Revenue & Realization

  • Consolidated revenue: ₹263 crores, representing 15% quarter-on-quarter (QoQ) growth and 3.6% year-on-year (YoY) growth
  • Price realization per ton: ₹88,597 per ton, showing significant improvement from ₹79,180 per ton in Q4 FY26 (12% increase)
  • Improvement attributed to better product mix (more Pre-Painted and Alu-Zinc) and improved pricing on new orders

Profitability Metrics

  • EBITDA: ₹29.08 crores, up 86% QoQ
  • EBITDA margin: 11.06%, recovering 422 basis points QoQ
  • EBITDA per ton: ₹10,400 per ton (highest ever recorded, better than Q1 FY26)
  • PBT: ₹18.93 crores, recovering 197% QoQ
  • PAT: ₹14.10 crores, up 163% QoQ
  • PAT margin: 5.36%, improving 301 basis points QoQ
  • EPS: ₹1.31 per share, growing 102% QoQ
  • Cash profit (PAT + depreciation): ₹17.40 crores, up 115% QoQ

Finance Costs

  • Finance costs: ₹6.86 crores, reduced by 11.8% YoY
  • Reduction achieved despite higher asset base from Alu-Zinc investment

Operational Performance

Production Metrics

  • Alu-Zinc output: 27,941 tons for the quarter, 8% higher QoQ
  • New Alu-Zinc line running at 62% capacity utilization and ramping up steadily
  • Pre-Painted production: 20,510 tons at 95.4% utilization (essentially full capacity)

Sales Breakdown

  • Total sales: 27,938 metric tons
  • Product mix: 74% Pre-Painted Steel, 26% Alu-Zinc
  • Export contribution: 65% of total volume (18,221 metric tons)
  • Export growth: Pre-Painted Steel exports grew 25% YoY, export revenue grew 20% YoY

Market Expansion

  • Entered 4 new international markets during Q1: Latvia, Brazil, Jamaica, and Somalia

Strategic Projects & Capex Update

Second Color Coating Line

  • In advanced stages of production and commissioning
  • Target commissioning: Q2 FY27
  • Capacity expansion: From 86,000 tons to 236,000 tons per annum (174% increase)
  • Existing line at near full capacity utilization, indicating strong waiting demand

7 MW Captive Solar Power Plant

  • Target commissioning: Q2 FY27
  • Expected impact: Offsets 50-55% of grid power consumption at Kutch facility
  • Provides permanent structural reduction in energy cost per unit
  • Supports greener manufacturing commitment

Salesforce CRM Implementation

  • Implementation underway
  • Provides centralized visibility of customer base, inquiries, orders, and after-sales across domestic and export markets

Future Outlook & Guidance

Order Book & Visibility

  • Current order book: Approximately ₹450 crores (± ₹20-25 crores)
  • Execution timeline: 4.5 to 5 months
  • Demand visibility: Expected to maintain order book of ₹350-450 crores continuously
  • Order intake pattern: Repetitive quarterly orders from long-term customers with good visibility

Capacity Ramp-up Expectations

  • Alu-Zinc line: Expected to reach 75-80% capacity utilization in next 3 months
  • Second color coating line: Expected faster ramp-up than Alu-Zinc line due to less complexity
  • H2 FY27 utilization target: 50-60% for new color coating line

Revenue Projections

  • FY28 volume target: 180,000-210,000 tons
  • FY28 revenue potential: ₹1,700-1,750 crores
  • Peak revenue potential (post Phase 2 completion): ₹2,500-2,700 crores at optimal utilization

Margin Sustainability

  • All new orders priced to fully cover current raw material and freight costs with margin buffer
  • Quarterly price reset mechanism with export customers provides cost pass-through
  • EBITDA margins expected to be sustainable with potential for further improvement
  • Drivers: Capacity additions, Alu-Zinc ramp-up, solar savings, and export momentum

Capex Funding & Financial Position

Completed Capex

  • Total capex spent: ₹140 crores (includes Alu-Zinc technology upgrade, second color coating line, and solar power plant)
  • Current status: Largely in CWIP, to be capitalized in Q2 FY27

Future Capex Plans (Phase 2)

  • Estimated capex: ₹350 crores for backward integration (cold rolling) and second Alu-Zinc line
  • Funding mix: Internal accruals, debt, and equity
  • Expected debt requirement: Approximately ₹100 crores (estimate)

Debt Position & Leverage

  • Current debt: ₹115 crores (includes term debt for capex)
  • Expected peak debt: ₹125-130 crores
  • Current debt-to-equity: Just above 1x
  • Expected peak leverage: Not exceeding 1.25x debt-equity ratio

Working Capital

  • Current working capital cycle: Approximately 75 days
  • Expected improvement: Cold rolling unit implementation expected to drastically reduce inventory and compress working capital cycle to single-digit days
  • Current working capital limits: Using very low percentage of available facilities

Risk Factors & Mitigation

Fuel Supply & Cost Management

  • Faced LPG price volatility during Q4 FY26 (₹60/kg to ₹200/kg)
  • Current prices normalized to ₹80/kg (25% higher than pre-war levels)
  • Diversification strategy: Added private suppliers alongside PSU companies
  • Future derisking: Planning natural gas pipeline from GSPC in Gujarat
  • Current situation: Ample fuel availability with prices in favor of buyer

Commodity Price Risk

  • Business model focused on back-to-back operations
  • Advanced order booking followed by raw material procurement
  • Eliminates commodity price risk through priced-in orders

Management Commentary

The company emphasized that Q1 FY27 represents a strong beginning to the year after challenges faced in H2 FY26. The management expressed confidence in multiple growth drivers including capacity additions, Alu-Zinc ramp-up, solar savings, and export momentum. They believe the company is better positioned than ever to capitalize on emerging opportunities and deliver sustainable long-term value.