Analyzing...
Ladies and gentlemen, good day, and welcome to the Earnings Conference Call hosted by Hi- Tech Pipes Limited. As a reminder, all participant lines will be in the listen-only mode and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing star then zero on your touch-tone phone. I now hand the conference over to Mr. Anish Bansal, Whole-Time Director from Hi-Tech Pipes Limited. Thank you, and over to you, Mr. Bansal. Good afternoon, ladies and gentlemen.
A very warm welcome to all of you, and thank you for joining us on the Q1 FY '26 Earnings Conference Call of Hi-Tech Pipes Limited. I'm joined today by Mr. Arvind Bansal, Executive Dircctor and Group CFO; and Mr. Arun Sharma, Company Secretary and Compliance Officer.
Let me take this opportunity to walk you through the highlights of our financial and operational performance for the quarter ended June 30, 2025. In Q1 FY 26, our revenue from operations stood at INR791 crores compared to INRS66 crores. Sales volume increased to 1.24 lakh tons compared to 1.22 lakh tons in the corresponding quarter last year, demonstrating our sustained ‘market momentum.
We recorded an EBITDA of INR41.03 crores and our profit after tax stood at INR21 crores, marking the highest ever quarterly PAT in the company’s history, a significant milestone and validation of our disciplined execution. On per ton basis, our EBITDA stood at INR3,308 reflecting a notable improvement of 10% on quarter-on-quarter basis, driven by better product mix and improved realizations.
Now let me provide an update on our ongoing capacity expansion initiatives, which will take us beyond 1 million tons of installed capacity post commissioning. Our greenfield plant at Sikandrabad is in final stage of commissioning and is expected to begin commercial production in Q2 FY '26. This advanced facility will manufacture specialized ERW pipes catering to infrastructure, defense and renewable energy seotors and is set to significantly strengthen our presence in North India.
Our brownficld expansion at Sanand Unit-IL, Phase 2, is also on track to commence production in Q2 FY '26. This facility is being developed as dedicated manufacturing hub for the infrastructure and renewable cncrgy segments. Encouragingly, we arc consistently witnessing strong order inflows from the rencwable energy sector, and our special grade pipes have been very well received in the market. This validates our strtegic focus on innovation and engincering excellence. ‘We continue to enhance our product portfolio in the alignment with market needs and application trends. During the quarter, we added new SKUs across our product categorics, enabling us to cater to a broader spectrum of customers and expand our relevance in both infrastructure and industrial markets.
Strengthening market presence remains a core priority. In Q1 FY 126, we exceuted our targeted door-to-door campaign across South India and North India, where our teams engage directly Page 2 0f 6
with fabricators, contractors, retailers and architeets. These cfforts are building client trust, customer loyalty and positioning High-Tech Pipes as a preferred name in key micro markets.
Looking ahead, we remain committed to our vision of achicving 2 million tons of installed capacity by FY "2 in alignment with India's accelerating infrastructure and industrial growth.
As part of this growth road map, we are also undertaking a strategic foray into API-grade pipe ‘manufacturing aimed at significantly increasing our share of high-value, precision cngincered products. This initiative will be integrated into our 2 million ton vision. Currently, we arc in the process of finalizing vendors, technology tic-ups, infrastructure planning, quality certifications and compliance, ctestera. With the commissioning of upeoming capacities, deeper penetration into valie-added segments, a growing export footprint and continued cost discipline, High-Tech Pipes is well positioned to deliver sustainable, scalable and profitable growth. We now open the floor for any questions. Thark you.
Thank you very much. The first question comes from the line of Nishant Gupta from Minerva Capital Research Solutions. Please go ahead.
Thank you for the opportunity. Congratulations on posting the highest ever PAT. Sir, I wanted to understand first the new capacitics, which are coming from Q2 FY 26, What are we expecting in terms of the top line? And how going forward we sce the contribution of valuc-added products in the fature, if you could clarify this?
So basically, this ~ both the facilities in Sikandrabad and Sanand, the cumulative capacity is around 250,000 tons anmually. And with this, we are hopeful that in the first year, we'll have a 50% utilization from these, both the expanded capacitics. So, this is the volume growth that we are looking at from Q3 onwards.
Secondly, when it comes to value addition, so both the projccts are focused mainly towards high valuc-added products, whether it is rencwable cnergy sector side or some defense pipes that we have identified and some special SKUs and coated products. So, this added capacity is mainly in the valuc addition segment. So, we are hopeful once these capacities come up and we'll have a good room for our EBITDA margin growth.
So, sir, can we sce this value-added products which you - in your investor presentation of 37% probably go up to, let's say, 45% long term 45%. Can we sce that going forward?
Yes, yes. For sure. We arc looking upwards of 45% with this expanded capacity.
Sir, could you also clarify, so there was, the volume still grew, but the top line contracted. I believe the prices were a bit of a concern. So, going forward, sir, what s the optimal operating profit margin that we can sce once the value-added products share start to go up?
Yes, Nishant. So, the volumes have gone up, but the total revenue has come because, has come down because of the steel price fluctuations and volatility compared to last year. And what we sce is like, you know how the tariffs arc playing in the international market, and it is having its Page 30f 6
impact on the steel prices also globally. So, these prices are still not stabilized and they are fluctuating quite rapidly.
So, we arc keeping an eye on this. But L certainly fecl the prices where we are right now operating at, these arc like in the bottom range only. So, I don't sce any further deterioration in the steel prices from here on. And if the Indian government increases the safeguard duty or if there s any other import restriction mechanism, then that will aid stecl price hike. So, we'll have to wait it out.
Got i, sir. Got it. Any impact on your order book? So, to say you are sceing because of these tariffs, a lot of export, at least on the export side, I mean people have started to sce issucs, but you are saying that there is a very strong demand still in the renewable sector, which we are sceing. So, any issucs that you have started to foresce in your end-customers' demand with these tariffs and everything or any deferment of orders which have started to happen or any intimation around that?
So, Nishant, this is a bit interesting for our sector. So, what has happened is, U.S. has placed uniform tariff of 50% on steel and steel products across all the nations. So, India is also in that 50% category like any other country? So now it's sort of a level playing field for any other country which is outside of U.S., which is willing to export to the U.S. market.
So, we are in the same bracket. So, no other country enjoys extra benefit compared to another one. So, this is a slight positive for the - for our sector. And going forward, once this dust settles of tariffs and everything, I think we will have some opportunity in the U.S. matket.
Got i, sir. Got it. Just one final question from my side before Ifall back. So, what is the optimal margins that you expeet, like once the steel prices stabilize and things come back to normal?
Obriously, it will take some time, but what is the optimal operating profit margins that you're targeting internally, which you can probably share that this is something that we are looking a?
Tt can be a long- term target, but still, what is something that we are looking at?
Nishant, with our new product development focus, new markets, international matkets, now we are going in API segment. We launched new jumbo sections in last quarter. So, if the markets had been well aligned and perfect, INR4,500 to INRS,000 EBITDA is not an impossible farget for us. But once this volatility comes down, I think we'll be in that range pretty shortly.
But to give exact idea is difficult right now because we see every month fluctuations happening.
But once this stables and with our, this new capacity that is coming up, upwards of INR4,000 s not a very big deal. So, we are just waiting for things to settle down, the prices, steel prices to stabilize.
Fine sir. Thank you for taking my question. I will fall back in the queue.
Thank you. Our next question comes from the line of Soham with RV Ivestments. Please go ahead. Page 4 of 6
Sir, Ijoined in a bit late. Any guidance for FY 126 on the volume side?
Soham, the current run rate s around 1.25 lakh tons. And this new capacity that we are, so we are operating at a pretty much at an optimal level right now. And with this commissioning of both the new facilities, we are hoping a 50% tilization from these facilitics going forward. So anywhere between 5.5 lakh to 6 lakh tons is a volume number that we are looking at.
Thank you. Our next question comes from the line of Aadesh Mehta from Motilal Oswal AMC. Please go ahead.
Sir, just wanted to understand with this volume of around 1,24,000 tons, which we did this quarter, what do we think and plus with the new plants also getting operational, how will the volume ramp-up be quarter-on-quarter going ahead? We understand that full year ramp-up can be anywhere between 5.5 to 6, but what is the quarterly trajectory?
So, Aadeshji, we are looking at approximately 30,000 tons from both the facilities ona quarterly basis to start with, and this will be ramped up quarter-on-quarter. But this is, 30,000 tons, we are quite confident that in the first quarter itsclf, we'll do a 30,000 tons volume from these facilitics in the first quarter.
Okay. So, first quarter will be 2Q, right? First quarter will be Q3.
Q3. Okay. So 2Q will also be flattish, sir?
So Q3 will be approximately in this range if this facility come in like late of August as we are thinking. So, there might be some incremental volume for this quarter.
Got it. Got it. So basically, even next quarter, we'll be doing around 124,000, right?
Sir, as I said, if we are able to commission it in this month and so we'll have one month in our hand, and we are hopeful that some quantity should come for this quarter also. But to a definite mumber, it will be slightly difficult, it will be premature right now. But there will be definitcly, there will be some addition.
Okay, sir. And sir, what is your, so we are sceing Y-0-Y, our EBITDA per ton has also corrected.
What is our understanding of margins and where can it go ahead going forward?
See sir, there is INR100, INR150 per ton dip is there. This is mainly due to the steel price volatility that is happening right now. So, prices are not stable. International prices, they went down. But even then, we have managed to not get affccted by that. And for the branding, like a lot of big companics’ expenditure s going in branding also. But once this stabilizes, this will go up. And with this new, as I mentioned carlicr, with these new two plants, this is mainly these products from both the plants will be focused towards value- added segment. And our share of Page 5of 6
valuc-added products from 37%, 38% will go up to 45% with this cxpanded capacity. So, all in all so like coming quarters should be quite healthy for the company.
As there are no further questions from the participants, I now hand the conference over to M. Anish Bansal for the closing comments.
Thank you. On behalf of the Board and the entire leadership team, I would like to extend my sincere appreciation to all our stakeholders, sharcholders, employees, customers and business partnrs for your umwavering trust and support. We look forward to building a stronger, more innovative and future-ready Hi-Tech Pipes. Thank you. Moderator ‘Thank you, sir. On behalf of Hi- Tech Pipes Limited, that concludes this conference. Thank you for joining us, and you may now disconnect your lines. Page 6 of 6