Financial Performance Highlights

Full Year FY26 Performance:

  • Total Income: ₹716 crores, representing year-on-year growth of 41.7%
  • EBITDA: ₹28.9 crores with growth of 18.8%
  • PAT: ₹12.87 crores, registering growth of 39.24% (excluding exceptional items from previous year)

Q4 FY26 Performance:

  • Total Income: ₹244.57 crores, reflecting year-on-year growth of 63.3% and sequential growth of 52.7%
  • EBITDA: ₹9.89 crores, showing growth of 22% year-on-year and 54% quarter-on-quarter
  • PAT: ₹7.45 crores
  • PAT Margin: 3%, reflecting sequential expansion of 185 basis points

Operational Updates and Capacity

  • Manufacturing facility spread across approximately 12.5 acres in Ghaziabad, NCR region
  • Steel melting capacity: 85,000 tons per annum
  • Rolling capacity: 2,00,000 tons per annum
  • Products: Stainless steel billets, stainless steel wire rods, and TMT bars
  • Current capacity utilization: 51-52% for both rolling mill and steel melting shop
  • Production growth: Rolling mill production witnessed 117% year-on-year growth after restart
  • Target: Planning to ramp up utilization to 65-70% in FY27 and eventually to 80%

Technology and Efficiency Initiatives

  • India's first and only stainless steel wire rod manufacturer using direct charging technology
  • Implementing direct charging technology for TMT division
  • Expected savings: ₹3,000-4,000 per ton saving in rolling division (6-7% of selling price)
  • Benefits: Improved thermal efficiency, reduced fuel consumption, lower manufacturing costs, reduced carbon emissions

Sustainability Initiatives

  • Green power sourcing through open access contributed to more than one-fourth of overall power consumption
  • Received GreenPro Type-1 Ecolabel certification from CII for Rathi Powertech branded 550 grade TMT bars
  • Planning rooftop solar power generation initiatives (1-2 megawatts capacity)
  • Evaluating additional certifications including Green Steel Certification from Ministry of Steel

Market Position and Customer Base

  • Serves infrastructure, engineering, construction, and industrial applications
  • Revenue mix: Approximately 60% from B2B segment, 40% from TMT bar segment
  • Institutional customers include Ace, Wave, VVIP, Ambience, Omaxe, ATS, and historically supplied to Jaypee Group, DLF
  • Strong presence in NCR region with good brand recall and distribution network
  • Average debtor period: 25-30 days
  • Inventory holding: Approximately one month's inventory

Strategic Focus and Growth Plans

  • Focus on ramping up utilization levels and improving operational efficiencies
  • Increasing presence in high-margin and value-added products
  • Evaluating expansion opportunities for steel melting shop at costs below industry benchmarks
  • Targeting 20-25% revenue growth CAGR from FY25 base
  • Actively pursuing inorganic growth opportunities in steel and allied sectors
  • Capex: incurred ₹20+ crores in FY26 largely for replacement and debottlenecking

Working Capital and Financing

  • Current borrowing cost: 16% from single lender
  • Exploring refinancing and additional facilities at lower costs
  • Working capital cycle: Payable days ~60 days, Inventory days ~25-30 days, Receivable days ~30 days
  • Raw material cost: Approximately 80% of sales

Regulatory Matters

  • Disclosed GST department disputes related to input ITC issues
  • Matters at various stages of adjudication with some stays from higher courts
  • Management believes disputes are not sustainable based on legal advice

Market Environment

  • Healthy steel demand driven by government spending on infrastructure, railways, roads, transmission projects, renewable energy, and urban development
  • Industry experiencing global steel volatility, elevated fuel costs, geopolitical uncertainties
  • Pressure from competitively priced imports entering Asian markets
  • Accelerating transition towards sustainable and low-carbon steel manufacturing
  • Green steel becoming important priority for institutional buyers and government projects

Conference Call Participants

Management:

  • Mr. Udit Rathi – Promoter
  • Mr. Rajesh Jain – President
  • Mr. Kushal Agarwal – A.V.P. (Growth & Strategy)

Moderator:

  • Mr. Parth Acharya – Kirin Advisors Private Limited

Q&A Session Highlights

  • Management discussed volume growth, product spreads, and margin outlook
  • Addressed questions on payment cycles, customer segments, and market competition
  • Provided details on rooftop solar plans and TMT mill restart rationale
  • Discussed raw material cost management and inventory risk strategies
  • Shared insights on green steel demand evolution and regional market opportunities