Key Financial Performance Metrics

Full Year FY26 (Year ended March 31, 2026):

  • Revenue from operations: ₹518.7 crores, representing 7% year-on-year growth
  • EBITDA: ₹76.2 crores
  • EBITDA margins: 14.7% (versus 16.1% in FY25)
  • PAT: ₹38.8 crores, representing 22% year-on-year growth
  • PAT margins: 7.5% (up 100 basis points from 6.5% in FY25)
  • Export revenue contribution: 34.6% of total revenues

Q4 FY26 (Quarter ended March 31, 2026):

  • Revenue: ₹123.6 crores (broadly flat year-on-year)
  • EBITDA: ₹16.7 crores
  • EBITDA margins: 13.5% (versus 14.1% in Q4 FY25)
  • PAT: ₹6.3 crores (decreased 7% year-on-year)
  • PAT margins: 5.1% (down 40 basis points from 5.5% in Q4 FY25)
  • Export revenue contribution: 44.8% of total revenues

Geographical Revenue Breakdown (FY26):

  • India: ₹339 crores
  • Europe: ₹137.8 crores
  • Americas: ₹30.7 crores
  • Others: ₹8.9 crores

Operational Highlights and Capacity Expansion

Current Capacity Status:

  • Seamless capacity increased to 20,000 metric tons per annum (MTPA)
  • Total production capacity: 21,000 MTPA in FY26
  • Mother hollow mill supports backward integration with 70% captive consumption currently
  • Target: 100% captive consumption by FY28

Welded Capacity Expansion:

  • New welded facility adding 8,000 MTPA capacity
  • Investment: Approximately ₹40 crores funded through internal accruals and term loans
  • Equipment delivery expected: July-August 2026
  • Trial runs targeted: End of Q2 FY27
  • Operational timeline: H2 FY27
  • Total welded capacity post-expansion: 21,150 MTPA by H1 FY28
  • Optimum utilization expected: FY29

Solar Power Project:

  • Total capacity: 8.79-megawatt DC
  • 4.99 MW for seamless facility
  • 3.8 MW for upcoming welded plant
  • Expected annual generation: 137 lakh KWH
  • Estimated electricity cost saving: ₹8.63 crores per year
  • Expected EBITDA margin improvement through reduced grid power dependence

Capital Expenditure and Balance Sheet

FY26 Capex:

  • Total capex incurred: ₹110 crores
  • Net block of fixed assets (as of March 31, 2026): ₹194.4 crores
  • Capital work-in-progress (as of March 31, 2026): ₹8.8 crores

IPO Proceeds Utilization:

  • Total raised: ₹220 crores
  • Deployment as of H2 FY26:
  • Capex: ₹27 crores
  • Working capital: ₹50 crores
  • Remaining bank balance: ₹74.2 crores

Operational Challenges and Disruptions

March 2026 Plant Shutdown:

  • Duration: 15-17 days (approximately March 7-8 to March 21-22)
  • Cause: PNG gas supply disruptions due to geopolitical situations affecting imports from Qatar
  • Impact: Production volumes reduced by 40% during the period
  • Revenue impact: Estimated potential revenue of ₹140 crores for the quarter was curtailed
  • Additional impact: Rising LPG prices increased production costs and affected operating efficiency

Inventory and Working Capital:

  • Inventory days: 217 days in FY26 (attributed to plant shutdown)
  • Target inventory days: 160-170 days for future years
  • Debtor days increased due to supply chain disruptions and longer payment cycles across industry

Future Outlook and Guidance

FY27 Guidance:

  • Revenue growth: 25%
  • EBITDA margins: 14-15%
  • Geographic mix target: 40% export, 60% domestic
  • Debt increase: Approximately ₹50 crores for capacity expansion and solar projects
  • Peak debt expected: ₹250 crores

Capacity Utilization Expectations:

  • Seamless: 70% utilization in FY27
  • Welded: 25% utilization in FY27 (on 13,000 MTPA capacity)
  • Optimum utilization targets:
  • Seamless: FY28
  • Welded: FY29

Market Developments and Opportunities

New End-Use Sectors for Welded Products:

  • Data centers
  • Water treatment
  • Construction
  • HVAC systems

Regulatory Approvals:

  • Rina Marine approval (Italian marine sector) in final stage, expected within 3-4 weeks
  • Existing approvals with BHEL and NTPC

Order Book and Demand:

  • Current order book: ₹175 crores (3-4 months visibility)
  • Awaiting BHEL tender expected in July-August 2026
  • Strong inquiries for data center applications awaiting welded capacity operationalization

Raw Material Price Environment:

  • Stainless steel round bar prices increased 25-30% due to geopolitical situations affecting scrap imports
  • Price increases are passed through to customers with a lag

Management Commentary Highlights

Strategic Focus:

  • Transition from single-segment seamless focus to diversified stainless steel tubes company
  • Priority shift from capacity creation to improving utilization levels and operating efficiency
  • No plans for further equity dilution
  • Focus on disciplined fund utilization aligned with growth plans

Export Performance:

  • Strong Q4 FY26 export growth despite global trade disruptions
  • Driven by expanding customer base and international demand
  • Oil and gas sector represents approximately 50% of export supplies
  • Remainder from engineering industries, automotive sectors, power projects, and cooling industries

Participants in Conference Call

Management Team:

  • Mr. Samarth Patel – Chairman and Whole Time Director
  • Mr. Ravi Patel – Chief Financial Officer
  • Mr. Raj Shah – Capital Bridge Advisors (Investor Relations Consultant)
  • Mr. Hrishit Jhaveri – Capital Bridge Advisors (Investor Relations Consultant)

Analyst Participants:

  • Sucrit Patil (Eyesight Fintrade)
  • Adishwar Golchha (Samarsh Capital)
  • Sahil Sanghvi (Monarch Networth Capital)
  • Viraj Parekh (Carnelian Asset Management)
  • Parikshit (Niveshaay Investment Advisory)
  • Sachin (Trade Quest)
  • Jugal Parekh (Individual Investor)
  • Shlok (Xylem PMS)
  • Shubham (Chhattisgarh Investments)
  • Kapil (Aarth Growth Fund)
  • Aryan Bhatia (InVed Research)
  • Akshay Darji (Self-Shine Industries)