Financial Performance Highlights

Consolidated Results (Q2 FY27):

  • Revenue from operations: ₹1,348 crores (13% YoY growth from ₹1,192 crores in Q2 FY26)
  • EBITDA: ₹220 crores
  • EBITDA margin: 16.3%
  • PBT: ₹174 crores
  • PAT: ₹133 crores

Standalone Results (Q2 FY27):

  • Revenue from operations: ₹1,104 crores (18% YoY growth)
  • EBITDA: ₹139 crores
  • EBITDA margin: 12.6%
  • PBT: ₹106 crores
  • PAT: ₹80 crores

Operational and Business Updates

Order Book Position:

  • Standalone order book increased to over ₹2,600 crores, approximately 30% higher than previous quarter
  • Stainless steel order book: Approximately ₹1,000 crores
  • Carbon steel order book: Approximately ₹1,700 crores

Capacity Expansions:

  • Spiral Mill-3 commissioned with capacity to manufacture pipes up to 18 meters with annual capacity of 100,000 tons
  • External 3LPE coating plant commissioned at Odisha with annual capacity of 25 lakh square meters

Credit Rating Updates:

  • Standalone credit rating upgraded to CRISIL AA+/Stable
  • RFSS credit rating upgraded to CRISIL AA

Specialized Product Segments:

  • Received approval to supply stainless steel seamless U-tubes for carbamate condensers from a leading global technology licensor
  • Secured orders for HP heater cold finished tubes and hairpin heat exchanger seamless tubes for nuclear projects
  • Development order for steam generator tubes from Nuclear Power Corporation of India Limited
  • Entered into global supply frame agreement for aerospace tubes with Safran (5-year agreement with increasing annual values)
  • Successfully supplied critical seamless tube in size of 138 by 1 mm

Subsidiary Performance

Ravi Technoforge:

  • Quarterly revenue: ₹99 crores (vs. ₹96 crores YoY)
  • EBITDA: ₹12 crores
  • EBITDA margin: 11.8%

Ratnamani Finow Spooling Solutions (RFSS):

  • Quarterly revenue: ₹157 crores (vs. ₹110 crores YoY)
  • EBITDA: ₹86 crores
  • EBITDA margin: 54.7%
  • PAT: ₹65 crores
  • Secured new export order worth approximately ₹2,700 crores
  • Order book: Over ₹3,000 crores
  • Part of expansion project commissioned; production of induction bends expected to commence next quarter
  • Realization range: ₹2,500-3,500 per kg
  • Long-term EBITDA margin guidance: 25%-30%
  • Full potential revenue: ₹1,200-1,500 crores

Cost Structure and Margin Pressures

  • Gross margins maintained despite challenges
  • Significant increase in freight and forwarding expenses due to geopolitical uncertainties impacting global logistics
  • Other expenses increased substantially due to DDP (Delivered Duty Paid) terms for US export orders which include 50% tariff duty, ocean freight, and local transportation costs
  • Management expects elevated freight costs to continue for next 6-12 months

Demand Outlook and Guidance

Management maintained FY27 guidance:

  • Standalone revenue: ₹4,000-4,200 crores
  • Consolidated revenue: ₹5,000-5,200 crores

Demand Drivers:

  • Strong demand from thermal power projects (government and private)
  • Oil and gas globally (LNG plants in US)
  • Data centers in US
  • Chemical, fertilizer, heat exchangers in India

Bidding Pipeline:

  • Carbon steel bidding pipeline: Approximately ₹5,000+ crores (both line pipes and in-plant piping)
  • Middle East projects expected to materialize by middle or end of next year

Segment-wise Demand Status:

  • Water segment demand remains weak with no significant improvement expected
  • State government finances under pressure affecting water projects

Working Capital

  • Working capital intensive business with inventory and receivables cycle of 5-6 months
  • Inventory accumulation due to deferred export shipments caused by geopolitical issues
  • Receivables impacted by extended transaction timelines due to Incoterms and shipping disruptions

Raw Material and Pricing

  • Company closes raw material positions upon receiving orders to minimize price risk
  • No materiality clauses for passing on fuel, freight, or oil price increases to customers
  • Current orders unable to pass through cost increases; future orders building in higher costs

Regional Performance

  • US exports account for approximately 20% of order book
  • Middle East exports facing logistical challenges with shipments to Saudi ports for Abu Dhabi projects

Management Commentary

Management remains focused on operational efficiency, cost management, and profitable growth despite global cost challenges. The company is positioned well for opportunities ahead through ongoing capacity expansion and growing presence in specialized applications.