Q1 2027 APL Apollo Tubes Ltd Earnings Call
Operator: Ladies and gentlemen, good day, and welcome to the APL Apollo Tubes Limited Q1 FY27 earnings conference call hosted by Antique Stock Broking 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. Please note that this conference is being recorded. I now hand the conference over to Mr. Pallav Agarwal from Antique Stock Broking. Thank you, over to you, sir.
Speaker #1: 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 and zero on your touch-tone phone.
Speaker #1: Please note that this conference is being recorded. I now hand the conference over to Mr. Pallava Agarwal from Antistock Broking. Thank you, and over to you, sir.
Speaker #2: Yeah, thank you, Lizanne. And good morning, everyone. Apologies for the delay in starting the call. We have the senior management of APL Apollo Tubes represented by Mr. Sanjay Gupta, the Chairman and Managing Director.
Pallav Agarwal: Yeah. Thank you, Lizanne, good morning, everyone. Apologies for the delay in starting the call. We have the senior management of APL Apollo Tubes, represented by Mr. Sanjay Gupta, the Chairman and Managing Director, Mr. Rahul Gupta, the Director, Mr. Deepak Goyal, the Director, Operations, Mr. Anubhav Gupta, the Chief Strategy Officer, and Mr. Chetan Khandelwal, the Chief Financial Officer. I'd now like to hand over the call to Anubhav for his opening remarks. Over to you, Anubhav.
Speaker #2: Mr. Rahul Gupta, the Director; Mr. Deepa Goel, the Director of Operations; Mr. Anurag Gupta, the Chief Strategy Officer; and Mr. Chetan Khandelwal, the Chief Financial Officer.
Speaker #2: So I'll now hand over the call to Anurag for his opening remarks. Over to you, Anurag.
Speaker #3: Thanks, Pallava, for hosting Apollo Tubes for its Q1 FY27 earnings call. I apologize to all the participants for starting this call a bit late.
Anubhav Gupta: Thanks, Pallav, for hosting Apollo Tubes for its Q1 FY27 earnings call. I apologize to all the participants for starting this call a bit late. There was a technical issue with the operator. Thanks for joining in. Just to highlight that Mr. Rahul Gupta, the Director, and Chetan Khandelwal, the CFO, they have gone for an urgent meeting. The call is being attended by Mr. Sanjay Gupta, myself, Anubhav, and Mr. Deepak Goyal, the Executive Director. Q1 FY27 was a mixed quarter. Hello, can I go ahead?
Speaker #3: There was a technical issue with the operator. Thanks for joining in. Just to highlight, Mr. Rahul Gupta, the Director, and Mr. Chetan Khandelwal, the CFO, have gone for an urgent meeting.
Speaker #3: The call is being attended by Mr. Sanjay Gupta, myself (Anurag), and Mr. Deepa Goel, the Executive Director. Q1 FY27 was a mixed quarter.
Speaker #3: Hello? Can I go ahead?
Speaker #1: Yes, sir. Please go ahead.
Operator: Yes, sir. Please go ahead.
Speaker #3: So, quarter one FY27 was a mixed quarter, wherein the volume was below expectations, but the profitability was better than expectations, despite declining quarterly volume.
Anubhav Gupta: Q1 FY27 was the mixed quarter wherein the volume was below expectations, but the profitability was better than expectation despite a decline in the quarterly volume. We have to decode the volume of 745,000 tons for the quarter, and if we map it with the Q4 FY26 volume, there were three, four factors which impacted the volume. Number one, of course, being the UAE operations, which were hit because of the geopolitical situation there, and we lost almost 25,000 tons quarter-on-quarter. Number two reason was a decline in the volume of SG Premium brand, which of course is in competition with the secondary material. Because of a price gap which was pretty high, the volume suffered there. Number three reason was the energy crisis in India, which impacted our volume for some of the products, like rustproof pipes and roofing products.
Speaker #3: So, we had to decode the volume of 745,000 tons for the quarter. And if we map it with the Q4 FY26 volume, there were three, four factors which impacted the volume.
Speaker #3: Number one, of course, being the UA operation, which was hit because of the geopolitical situation there. We lost almost 25,000 tons, quarter on quarter.
Speaker #3: Number two, the reason was a decline in the volume of the LG Premium brand, which, of course, is in competition with secondary material. So, because of the price gap—which was pretty high—the volume suffered there.
Speaker #3: Number three reason was the energy crisis in India, which impacted our volume for some of the products, like Rust Group pipes and roofing products.
Speaker #3: So there also, we lost 25,000 to 30,000 tons volume. And the last reason being high factor inflation during the quarter, which led to softer demand in the construction industry.
Anubhav Gupta: There also we lost 25,000, 30,000 in volume. The last reason being the high factory inflation during the quarter, which led to the softer demand in the construction industry. It impacted both primary sales and secondary sales. Primary sales, because prices were pretty high and there was fear of correction in those commodities. This led to de-stocking by our channel partners. Secondary demand, which comes from the EPC contractors and real estate developers, and not only structural steel pipes, but other construction materials like cement, tiles, plywood, plumbing pipes, cables, and wires, electrical fittings, bath fittings, every construction material product prices went up. The EPC contractors and developers, they kind of delayed their purchases, which impacted the primary sales. Sorry, the secondary sales for Apollo Steel Pipes. Now the run rate was around 250,000 tons per month for the Q1.
Speaker #3: And it impacted both primary sales and secondary sales — primary sales because prices were pretty high, and there was fear of correction in all commodities.
Speaker #3: This led to de-stocking by our channel partners. And secondary demand, which comes from the EPC contractors and real estate developers, and not only structural steel pipes, but other construction materials like cement, tiles, plywood, and plumbing pipes.
Speaker #3: Cables and wires, electrical fittings, bath fittings—every construction material product's prices went up. So the EPC contractors and developers kind of delayed their purchases, which impacted the primary sales.
Speaker #3: Sorry, the secondary sales for Apollo Steel Pipes. Now, the run rate was around 250,000 tons per month for the first quarter. Our focus was on maintaining profitability because the situation was so uncertain due to the ongoing geopolitical situation.
Anubhav Gupta: Our focus was on maintaining the profitability because the situation was so uncertain because of the ongoing geopolitical situation. We chose to focus on profitability, and as a result, you would see that our gross profit per tonne increased by INR 1,000 on quarter-on-quarter basis. This was of course due to our better pricing power as we were holding on to prices. If steel prices were going up by INR 1,000 per tonne, we try to improve our prices for our product by INR +100, INR +200 per tonne over and above steel price increase. Because of our strong brand positioning and pricing power, we could sustain that.
Speaker #3: So, we chose to focus on profitability, and as a result, you would see that our gross profit per ton increased by ₹1,000 on a quarter-on-quarter basis.
Speaker #3: This was, of course, due to our better pricing power, as we were holding onto prices. If steel prices were going up by ₹1,000 per ton, we tried to improve our prices for our product by plus ₹100, plus ₹200 per ton, over and above the steel price increase.
Speaker #3: And because of our strong brand positioning and pricing power, we could sustain that. And because of improvement in gross profit by Rs 1,000 per ton, our EBITDA per ton was flattish, above Rs 5,500 per ton on a Q2 basis.
Anubhav Gupta: Because of improvement in gross profits by INR 1,000 per tonne, our EBITDA per tonne was flattish above INR 5,500 per tonne on QOQ basis, despite the negative operating leverage which arose because of 20% decline in volume on QOQ basis. Now that the scenario is slightly improving, we are again focusing on volume growth, and in the month of July, the volumes are up by 20% on month-on-month basis. We of course tweaked some pricing for some of the product categories, we do expect that our EBITDA spreads will remain in range of INR 5,000 to INR 5,500 per tonne throughout the year. For full year, we do expect and we are confident that we will be able to achieve 20% growth in absolute EBITDA.
Speaker #3: Despite the negative operating leverage, which arose because of a 20% decline in volume on a Q2 basis, now that scenario is slightly improving and we are again focusing on volume growth.
Speaker #3: And in the month of July, the volumes are up by 20% on a month-on-month basis. We, of course, tweaked some pricing for some of the product categories.
Speaker #3: So we do expect that our EBITDA spreads will remain in the range of ₹5,000 to ₹5,500 per ton throughout the year. For the full year, we do expect and we are confident that we will be able to achieve 20% growth in absolute EBITDA on a quarter-on-quarter basis.
Anubhav Gupta: On quarter-on-quarter basis, it is tough to anticipate absolute volume and absolute EBITDA per tonne, we are confident that for the full year we will be able to achieve 20% EBITDA growth in FY27 versus FY26. Now the capacity which is coming online, whether it is Gorakhpur which is a 200,000 tonne plant, then Siliguri 300,000 tonne plant, then new Malur, which is almost a 1 million tonne plant. Another 0.5 million tonne plant, which we are contemplating in either Maharashtra or North Karnataka. Put together 2 million tonne plant capacity will come online over the next two and a half years. Over and above 1 million tonne of new capacity through debottlenecking across the plants. With this 8 million tonne, our share of value-added products, which right now is like 65%, it will increase to almost 75%, 80%.
Speaker #3: It is tough to anticipate absolute volume and absolute EBITDA per ton, but we are confident that for the full year, we will be able to achieve 20% EBITDA growth for FY28 versus FY27, as we did for FY27 versus FY26.
Speaker #2: Now, the capacity which is coming online, whether it is Gorakhpur, which is a 200,000-ton plant, then Siliguri, a 300,000-ton plant, then New Malur, which is almost a 1 million-ton plant, and another 0.5 million-ton plant, which we are contemplating in either Maharashtra or North Karnataka.
Speaker #2: Together, 2 million tons of plant capacity will come online over the next two and a half years. And over and above that, 1 million tons of new capacity will come through debottlenecking across the plant.
Speaker #2: So, with this 8 million tons, our share of value-added products, which right now is about 65%, will increase to almost 75–80%.
Speaker #2: So as a portfolio, we are continuing to de-commoditize so that the impact of steel price volatility and the gap between primary and secondary steel continues to have less and less impact on our performance.
Anubhav Gupta: As a portfolio, we are continuing to de-commoditize that impact of steel price volatility and gap between primary and secondary steel, it continues to have lesser and lesser impact on our performance. On balance sheet front, the working capital days remain below zero, and the cash on books which we hit INR 15 billion in March 2026, it remains at similar level at INR 14 billion in Q2 as well. We continue to remain prudent in our working capital efficiencies. All in all, we can say that Q2 will be better than Q1 in terms of volume and absolute EBITDA. Second half, the macro factors should come into play in positive manner, which will boost H2 performance for APL Apollo, better than H1. It will give us room to achieve our annual guidance of 20% EBITDA growth.
Speaker #2: On the balance sheet front, the working capital days remain below zero. The cash on books, which we hit at ₹15 billion in March '26, remains at a similar level at ₹14 billion in the June quarter as well.
Speaker #2: And we continue to remain prudent in our working capital efficiencies. All in all, we can say that quarter two will be better than quarter one in terms of volume and absolute EBITDA.
Speaker #2: And in the second half, the macro factors should come into play in a positive manner, which will boost second half performance for Apollo, better than H1. And it will give us room to achieve our annual guidance of 20% EBITDA growth.
Speaker #2: The new capacity expansion, which will start coming in phases from the second half of this year through FY28, will allow us to continue to improve our financial performance over the next three to four years, from FY28 to FY30.
Anubhav Gupta: The new capacity expansion which will start coming in phases from H2 of this year till FY28, we will continue to improve our financial performance over the next three to four years from FY28 to FY30. That is all from our side. We will be happy to take questions now.
Speaker #2: That's all from our side. We'll be happy to take questions now.
Speaker #1: Thank you. Ladies and gentlemen, we will now begin with the question and answer session. Anyone wishing to ask a question may please press star and one on the attached telephone.
Operator: Thank you. Ladies and gentlemen, we will now begin with the question and answer session. Anyone wishing to ask a question, may please press star and one on your touch-tone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is on the line of Shaleen Kumar from UBS India. Please go ahead.
Speaker #1: If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handsets while asking a question.
Speaker #1: Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Shaleen Kumar from UBS India.
Speaker #1: Please go ahead.
Speaker #4: Yes. Thank you. Thank you, and congrats on the good setup numbers, despite the tough macro. Thank you and love. Thank you, Sanjivi. So, Sanjivi, I have a question for you.
Shaleen Kumar: Yeah. Thank you. Thank you, and congrats for the good set of number despite tough macro. Thank you, Anup. Thank you, Sanjay Gupta. Sanjay Gupta, I have a question with you. Sanjay Gupta, beginning of the year expectation
Speaker #4: Sanjivi, beginning of the year expectations are if we do around 15 to 20 percent volume in the year, so 1Q is still at the same level. So sir, for 1Q, we are basically saying that we can do almost 20% in the next 9 months.
Anubhav Gupta: Yes, Shaleen.
Shaleen Kumar: Basically 20% in next 9 months.
Speaker #2: Shalin, मोटा-मोटी, we are trying our level best to achieve these numbers of 15% to 20% in the volume growth, and 20% and above EBITDA growth.
Anubhav Gupta: Shaleen, we are trying our level best to achieve these numbers, 15% to 20% in the volume growth and 20% and above in EBITDA growth.
Speaker #4: Okay. Okay. So आप अभी guidance maintain कर रहे हैं?
Shaleen Kumar: Okay. Guidance.
Speaker #2: 101% कर रहा हूँ.
Anubhav Gupta: 101%
Speaker #4: Okay, that's very good to hear, sir. So, the second thing I want to understand is, like Dubai—Dubai, UAE as a market, right? So, where is it right now?
Shaleen Kumar: Okay. That's very good to hear, sir. Sir, second thing I want to understand Dubai as a UAE as a market, right? Where is it right now? Is it right to assume that there will be a pent-up demand as well as a reconstruction demand going forth? Second part of this would be.
Speaker #4: And in this, is it right to assume that there will be a pent-up demand as well as a reconstruction demand going forward? And the second part of this question will be—so, the second part of that question is—first, you complete.
Anubhav Gupta: Yeah.
Shaleen Kumar: Go ahead, sir. Second part of that question.
Anubhav Gupta: Yeah. First you complete. Shaleen, first of all, Dubai almost zero incoming or outgoing from July onwards, incoming materials pricing. We have a stock of almost material of 70,000 tons in transit in our plant. July, maybe we have done 15,000 tons in a year, 10,000 tons in the month of July. This month we are targeting the 60,000-70,000 tons plant. 24, 25 tons granite capture demand, local demand problem. 70,000 line up, improve line up. Dubai, we are very hopeful margins demand. Number 2, September Q3 volume, Q4 volume. APL roofing product 20,000 tons volume, extraordinary things and marketing. July, I don't think I have any problem to cross 15% volume growth. 20%, 15% I can say confidently.
Speaker #4: हाँ, मैं पूरा करता हूँ पहले। तो पहली बात यही है कि वहाँ पर एक pent-up demand होगी क्योंकि पिछले तीन-चार महीने से—I don't know, आप बताएँगे कि काम कैसा चल रहा है।
Speaker #4: दूसरी बात, obviously Middle East में जो भी issues हुए हैं, उसके वजह से reconstruction demand आएगी। तीसरा question ये होगा कि उस demand में हम participate कैसे करेंगे?
Speaker #4: सिर्फ वहाँ की capacity से या फिर हम यहाँ से export भी कर सकते हैं? तो इस पे ये question है, सर.
Speaker #2: Shalin, first of all, ये Dubai में इसमें हम almost zero पर पहुँच गए थे, पाँच-छह, या छः महीने पर पहुँच गए थे. क्योंकि वहाँ incoming और outgoing दोनों बंद था.
Speaker #2: Now, from July onwards, incoming—so our material that was in transit has mostly arrived. No doubt, we had to take some hit on pricing; there has been considerable damage to our seats.
Speaker #2: We have a stock of almost 20 of 70,000 tons in transit in our plant. तो अभी दो-तीन महीना तो हमको वहाँ पर कोई दिक्कत नहीं है.
Speaker #2: और July में we have done 15,000 ton in ये 10, 12,000 ton in the month of July. This month we are targeting the 16, 17,000 ton, हमारा plant पहुँच जाएगा वापस.
Speaker #2: और अगस्त में हमको ये, सितंबर में हमको लगता है वापस जो हमने 24-25 का capture किया था, वो कर लेंगे। Demand वहाँ पर local demand बहुत अच्छी create हो रही है।
Speaker #2: वहाँ पर हमारी एक ही थोड़ी problem है कि अब हमारे पास 70,000 का अभी raw material का कोई lineup नहीं है। तो अभी जैसे-जैसे scenario improve हो रहा है, तो हम raw material वापस lineup करेंगे।
Speaker #2: तो Dubai से we are very hopeful कि हमारा margins भी और demand भी अच्छी रहेगी। Number two, हमारा गोरखपुर जो नया area है इस zone में, हमारा सितंबर में किसी भी time चालू हो जाएगा।
Speaker #2: तो Q3 में वो भी हमको पूरा ramp-up volume देगा। Q4 में हमारा सिलीगुड़ी ramp-up volume देगा हमको। और हमारे कुछ अपने ABPL में एक लाइन हमारी ये roofing products की चालू हो रही है, वो भी हमको एक 20,000 का ramp-up volume देगी।
Speaker #2: These three, four extraordinary things, and plus, हम अब marketing में भी काफी aggressive हो गए हैं July से. I don't think कि I have any problem to cross 15% volume growth.
Speaker #2: हाँ, कुछ Tailwind साथ चाहिए होगा, 20% cross करने के लिए। वो थोड़ा सा अभी मैं confidence से नहीं कह सकता। 50% I can say confidently.
Speaker #4: Sir, अगर साल का 15% करेंगे तो next 9 महीने में 20% तो हो ही जाएगा.
Shaleen Kumar: 15% nine months, 20%.
Speaker #2: हाँ, मालूम है शालिन। 4 million ton cross करना पड़ेगा मेरे को। समझ रहा हूँ मैं भी। क्या बोल रहा है वो भी समझ रहा हूँ मैं।
Anubhav Gupta: Shaleen, 4 million tons.
Speaker #4: Okay, okay. So, basically, we are confident because of the new capacity coming, and in Q2, 10—
Shaleen Kumar: Okay. Basically, we are confident because of the new capacity coming and-
Anubhav Gupta: I am confident Q2 10 lakh tons July 3 lakh tons August targeting 330,000, 335,000. September targeting 350,000, 360,000 10 plus change confidently full year confident guideline achieve
Speaker #2: Lakh ton cross करने की पूरी कोशिश कर रहे हैं. हमने, सर, ये July में 3 lakh ton plus कर लिया है. अगस्त में we are targeting 330, 335.
Speaker #2: सितंबर में we are targeting 350, 60 के आसपास करके 10 plus करेंगे। थोड़ा सा बाकी इतना scenario थोड़ा सा काफी तेज change होता है, तो ज्यादा confidently मैं ये सब numbers नहीं बोलता, पर मैं full year के लिए एकदम confident हूँ कि मैं अपने जो guideline दे रखा है, उसको किसी भी तरह से achieve करूँगा।
Shaleen Kumar: That's very good to hear, sir. Sir, one last thing. The commodity price inching up, the gap between HRC and steel again increases. How is it impacting us?
Speaker #4: That's very, very good to hear, sir. That's very good to hear. Sir, one last thing, because you know, with commodity prices inching up, the gap between Q1 and Q2 again increases.
Speaker #4: So, how is it impacting us?
Speaker #2: ये बहुत बड़ा impact है, सर। शालिन, अगर ये impact नहीं होता तो मैं confidently तुमको 25% का भी growth बोल देता, जो small ये जुलाई-मार्च में चल रहा था, तो I can say 25%.
Sanjay Gupta: बहुत बड़ा impact है, साले। अगर impact नहीं होता तो मैं definitely तुमको 25% का भी growth बोल देता जो small January, March में चल रहा था तो I can say it 25%. इसमें hopeful thing क्या है कि अगर आप देखोगे तो steel capacity बहुत build up हो रही है, साले। उसके लिए maybe मेरे को एक, दो quarter, तीन quarter और pain झेलना पड़ सकता है। जिस हिसाब से steel capacity across the India आ रही है, I am very hopeful. This is a matter of time.
Speaker #2: But इसमें hopeful thing क्या है कि अगर आप देखोगे तो इसकी capacity बहुत build up हो रही है, शालिन. उसके लिए maybe मेरे को एक-दो quarter, तीन quarter और pain झेलना पड़ सकता है.
Speaker #2: But जिस हिसाब से steel capacity across the India आ रही है, तो I am very hopeful. ये this is a matter of time. मेरे को बस उस मैं उस time का wait कर रहा हूँ.
Sanjay Gupta: मैं उस time का wait कर रहा हूँ कि जहाँ पर आकर ये gap, आप देखोगे steel plants में जिस हिसाब से 15-20 हजार के EBITDA आ रहे हैं, तो capacity इस साल में आएगी ही आएगी। और capacity आएगी तो secondary को तो खत्म होना ही पड़ेगा क्योंकि उसकी cost primary के against में बहुत ज़्यादा है। The real pavement is अब वो लोग सब आएगा, जिस capacity के लिए मैं तैयार बैठा हुआ हूँ। अभी मैं तो कुछ भी नहीं, I am just passing the time.
Speaker #2: कि यहाँ पर आके ये gap, आप देखो कि ये steel plants में जिस हिसाब से 15-20,000 टन के EBITDA आ रहे हैं, तो capacity तो हिंदुस्तान में आएगी ही आएगी।
Speaker #2: और capacity आएगी तो secondary को तो खत्म होना ही पड़ेगा, क्योंकि उसकी cost बहुत है, primary categories में बहुत ज्यादा है। तो the real tailwind, Apollo का तब आएगा।
Speaker #2: जिस capacity का मैं तैयार बैठा हुआ हूँ, अभी मैं इससे पूछूँगा, तो I am passing the time.
Speaker #4: I hear you, sir. I hear you. Okay.
Shaleen Kumar: I hear you, sir.
Sanjay Gupta: अब जितने भी steel की capacity शुरू हो, हर तरफ से announcement आ रही है। Lloyds Steel ने 15 million ton का capacity announce किया हुआ है। उस पर बहुत तेज काम चल रहा है। AM/NS में भी उधर Vizag में 10 million, 12 million ton का capacity लग रहा है। JSW बहुत capacity announce कर रहा है। Tata capacity announce कर रहा है। JSPL capacity announce कर रहा है। DSL का एक नया plant मैंने अभी read करा हुआ है, नागपुर के आसपास आ रहा है। तो जिस हिसाब से capacity आएगी, हिंदुस्तान में down stream का time तो आएगा। अगर आप chakra material देखो, अगर study करो तो हिंदुस्तान के अलावा chakra कहीं नहीं होता। ये हमारे 30% business पर बड़ा impact है इसका, no doubt.
Speaker #2: ये बहुत जबरदस्त तरीके से, आप जितनी भी steel की capacity सुनोगे, हर तरफ से announcement आ रही है। Royal Steel ने 1.5 मिलियन टन की capacity announce की हुई है।
Speaker #2: उसमें बहुत तेज काम चल रहा है। AMS ने उधर YZ में 10-12 million ton का capacity लगा रहा है। GSW बहुत capacity announce कर रहा है।
Speaker #2: Tata capacity announce कर रहा है. JSPL capacity announce कर रहा है. DSL का एक नया plant मैंने अभी 10:30 पढ़ रहा था कि ये नागपुर के आसपास आ रहा है.
Speaker #2: तो जिस हिसाब से capacity आएगी, तो हिंदुस्तान में downstream का time तो आएगा। अगर आप 15 material देखो, तो अगर study करोगे तो हिंदुस्तान के अलावा 15 का ही नहीं होता।
Speaker #2: ये हमारे 30% business में बड़ा impact है इसका, no doubt. आपको हम plan A और plan B दोनों लेके चल रहे हैं। दूसरी तरफ अपने आप को non-15 segment में भी काफी हम अपनी capacity बढ़ा रहे हैं।
Sanjay Gupta: हम plan A और plan B दोनों लेकर चल रहे हैं। दूसरी तरफ हम अपने आप को non-chakra segment में भी काफी अपनी capacity बढ़ा रहे हैं, जिससे हमारा इसका impact भी खत्म हो जाए। Plus ये एक तो आ गया तो हमारे लिए सोने पर सुहागा है।
Speaker #2: जिससे हमारा इसका impact भी खत्म हो जाए। Plus, ये तो आ गया तो हमारे लिए सोने पर सुहागा है।
Speaker #4: Okay. Okay. Okay, sir. Great, sir. I think that's it from my side, sir. I'll run back the queue. And congratulations on a good setup.
Shaleen Kumar: Okay, sir. I think that's it from my side, sir. I will join back the queue, and congratulations on a good
Speaker #4: Thank you.
Sanjay Gupta: Thank you, Salim. Maybe आपको निराश नहीं करेंगे। हमारी full team लगी हुई है।
Speaker #2: Thank you, शालिन. Maybe आपको निराश नहीं करे कि हमारी पूरी टीम लगी हुई है, उस तरीके से.
Shaleen Kumar: For sure, sir. Thank you, sir.
Speaker #4: For sure, sir. Thank you, sir.
Speaker #2: Thank you. Thank you.
Sanjay Gupta: Thank you.
Speaker #1: Thank you. The next question is from Sneha from Novama. Please go ahead.
Operator: Thank you. The next question is from the line of Sneha from Nomura. Please go ahead.
Speaker #3: Hi, good day. Good morning, team, and thanks for the opportunity. A couple of questions from my end. One is, you clarified the guidance already.
[Analyst] (Nuvama Wealth Management): Hi, good evening. Good morning, team, and thank you for the opportunity. A couple of questions from my end. One is you clarified the guidance already. I would like to ask, sir, you also mentioned that Tatas and everyone is adding capacity on the upstream segment. What we also understand while doing channel checks are these, like example, Tata is expanding capacity from 2 and has plans to even go to up to 4 to 5 million tons into pipes also. They are also getting aggressive with respect to servicing. What's your take on the competitive intensity in the coming quarters? How is it at this point of time, and how is it likely to be going ahead? What are the measures that we are taking in order to retain market share and in fact, keep improving? That's first.
Speaker #3: I would like to ask, sir, you also mentioned that, you know, Tata, Jindal—everyone is adding capacity on the, you know, on the upstream segment.
Speaker #3: But what we also understand while doing channel checks, sir, is that, for example, Tata is expanding capacity from two and has plans to even go up to four to five million tons in pipes also.
Speaker #3: They are also getting aggressive with respect to servicing. What's your take on the competitive intensity in the coming sector? How is it at this point in time?
Speaker #3: And how is it likely to be going ahead? And, you know, what are the measures that we are taking in order to retain market share and, in fact, keep improving?
Speaker #3: That's first.
Speaker #2: Good morning, Sneha. Sneha's steel capacity तो आ ही रही है. अभी pipe में भी, I also heard and I also read कि Tata is also adding a capacity of 4 million tons.
Sanjay Gupta: Good morning, Sneha. Steel capacity तो आ रही है। अभी pipes में भी I also heard and I also read it कि Tata is also adding a capacity of 4 million ton. But I don't know because उसको पूरा describe नहीं किया कि कितना structural tube है, कितना automotive tube है, कितना API tube है। अगर आप देखोगे और भी बहुत सारे pipe के sectors हैं। हम तो एक ही sector में हैं। तो इस sector में उनका कितना target है I don't know. अभी तक हमको market share का कोई feel आ रहा है किसी भी competitors का। अभी तक हमको ऐसा कुछ feel भी नहीं कि हम तो market share lose कर रहे हैं। ठीक है, dealers थोड़े बहुत ऊपर-नीचे करते रहते हैं कि ये आ गया, वो आ गया। It's a part of life and business.
Speaker #2: But I don't know, इसको पूरा describe नहीं किया कि कितना structural tube है, कितना automatic tube है, कितना API tube है. अगर आप देखोगे, और भी बहुत सारे pipe में sectors हैं.
Speaker #2: हम तो एक ही सेक्टर में हैं। तो इस सेक्टर में उनका कितना टार्गेट है, I don't know. पर अभी तक हमको मार्केट से, सर, आपको कोई फील आ रहा है किसी भी कंपटीटर्स का?
Speaker #2: अभी तक हमको ऐसा कोई फील भी नहीं है कि हमको मार्केट से यूज़ कर रहे हैं। ठीक है, डीलर्स थोड़े बहुत ऊपर-नीचे करते रहते हैं कि ये आ गया, वो आ गया।
Speaker #2: It's a part of life and business. और बाकी 100% market से तो हम कभी ले ही नहीं सकते. कोई भी player आएगा, तो we have to... अगर हम 60-65% अपना market share ले जाते हैं, 50-55% से, तो this is good enough for us.
Sanjay Gupta: और बाकी 100% market share तो हम कभी ले ही नहीं सकते। कोई भी player आएगा तो we have to, अगर हम 60-65% अपना market share ले आते हैं 50-55 से, this is good enough for us. तो 35% में कौन आता है, नहीं आता है, we are not bother of उतना उसके लिए हम कोई plant बना भी नहीं सकते। Our target is to maintain our 60-65% market share.
Speaker #2: तो 35% में कौन आता है, कौन नहीं आता है, we are bothered of उतना सही, उसके लिए हमको ये कोई game plan बना भी नहीं सकते।
Speaker #2: Our target is to maintain our 60–65% market share.
Speaker #3: Great. Understood, sir. Sir, while you were already showing optimism that 20% growth will be achieved in nine months, how has July been for us and what has changed between June and July?
[Analyst] (Nuvama Wealth Management): Understood, sir. Sir, while you are already showing optimism that 20% growth will be achieved in 9 months, how is July been for us, and what has changed between June to July? ऐसा क्या हुआ है which is further giving an optimism. जैसे April start हुआ था तो you already hinted for a slower quarter. आपने बताया था 250,000 tons हुआ है। If at all you could tell us that how July month has been and why you are so optimistic that Q2 onwards things are looking up. Like changes क्या हुए हैं between June to July. Has the primary and the secondary steel spread reduced? Has the demand on ground increased? Infraspends बढ़े हैं। What are the things we would like to hear?
Speaker #3: ऐसा क्या हुआ है, you know, which is further giving optimism? जैसे April start हुआ था, तो you already hinted for a slower quarter.
Speaker #3: आपने बताया था ढाई लाख टन हुआ है. If at all you could tell us how the month of July has been, and why you are so optimistic that from Q2 onwards, things are looking up?
Speaker #3: What changes have occurred between June and July? Has the primary and secondary steel spread reduced? Has the demand on the ground increased?
Speaker #3: Infrastructure पड़े, you know, what are the things we would like to hear?
Speaker #2: Sneha, ऐसा कुछ बड़ा change नहीं हुआ है. And steel prices still up. But ये अप्रैल में जो मेरे को hint आ गया था कि price is में इतना almost कि ये eight, seven, eight thousand की price increase हुआ था Q4 में.
Sanjay Gupta: ऐसा कुछ बड़ा thing नहीं हुआ है। Steel price is still up.
Sanjay Gupta: April में जो मेरे को hint आ गया था कि price में almost ₹7,000-8,000 की price increase हुआ था Q4 में। तो everybody thinking कि कुछ price softer होगा। तो मेरे को मालूम था dealer अपने को आपको restocking करेंगे ही करेंगे, चाहे हम कुछ मर्जी कर लें। उसके लिए मैंने पहले ही थोड़ा soft volume का indicate कर दिया था। Demand कभी भी इतनी up down नहीं होती है। ये जो dealer destocking और restocking होता है ना, उसमें हमेशा demand up और down का फर्क पड़ता है। अगर आप last level पर demand देखोगे तो उतनी रहती है। उससे hardly 5%, 7%, 10% का फर्क पड़ता है। जो dealers अपने destocking और restocking करते हैं, उसमें हम लोग को impact है, जो बड़े players को थोड़ा उस चीज का impact आ जाता है। अब price downward जाने का सारा movement खत्म हो चुका है। Everybody clear है कि price down नहीं जाएगा। तो वापस से demand pick होना शुरू हो गया है। Dealers अपने normal stock position पर जाने लग गए हैं और July भी अब done three lakh ton plus। हमने July में अच्छा किया है और in this scenario we are very hopeful कि आगे भी हमारी demand अच्छी रहेगी और हम उसको पूरा कर लेंगे।
Speaker #2: तो everybody is thinking कि कुछ price soft turn होगा। तो मेरे को मालूम था dealer अपने को आपको restocking करेंगे ही करेंगे, चाहे हम कुछ मर्जी कर लें।
Speaker #2: उसके लिए मैंने पहले ही थोड़ा सा soft volume का indicate कर दिया था। Demand कभी भी इतनी up-down नहीं होती है। ये जो dealer restocking और destocking होता है न, उसमें हमेशा demand up और down का फर्क पड़ता है।
Speaker #2: अगर आप लास्ट लेवल पर डिमांड रखोगे तो उतनी ही रहती है। उसमें हार्डली पाँच–सात पर्सेंट, दस पर्सेंट का फर्क पड़ता है। बट जो डीलर्स अपने रेस्टॉकिंग और रेस्टॉकिंग करते हैं, उसमें हम लोगों को, जो बड़े प्लेयर्स हैं, उनको थोड़ा उसका इम्पैक्ट आ जाता है।
Speaker #2: अब क्या है कि price downward जाने का सारा जो momentum था, खत्म हो चुका है। Everybody is clear कि price down नहीं जाएगा। तो वापस से demand peak होना शुरू हो गया है।
Speaker #2: Dealers अपने normal stock position पर जाने लग गए हैं। और July भी अब done three lakh ton plus। हमने July में अच्छा किया है।
Speaker #2: और in this scenario भी, बहुत hopeful हैं कि आगे भी हमारी demand अच्छी रहेगी और हम उसको पूरा कर लेंगे.
Speaker #3: Understood. That was quite helpful, sir, of three lakh tons volume and the amount of July. Last question from my end. आप सब, you know, you gave the guidance that आप लोग value-added product segment में you are adding, you know, capacity.
[Analyst] (Nuvama Wealth Management): Understood. That was quite helpful sir of 3 lakh tons volume in the month of July. Last question from my end. You gave the guidance that आप लोग value added product segment में you are adding capacity, जिसमें आप share of value added will go to 75% to 80%. Could you help us कि what are the things that we are doing value added. Example, 1,000 by 1,000 which we recently launched and which are the other products like roofing products you said. और कौन-कौन से value added portion add कर रहे हैं which will take this portion higher.
Speaker #3: Jo jismein aap share aur value added mein go through 75-80%. Toh could you help us ki what are the things that we are doing value added?
Speaker #3: Example, 1000 by 1000 is what we recently launched. And you know, which are the other products, like the roofing product you mentioned. What value-added portion should we add?
Speaker #3: Which will take this portion higher?
Speaker #2: Sneha, हमारा जो गोरखपुर plant आ रहा है और सिलीगुड़ी plant आ रहा है, these are two plants in totally different regions, जो हमें हमारा सीधा volume increase करने में directly impact करेगा.
Sanjay Gupta: सिर्फ हमारा जो Gorakhpur plant आ रहा है और Siliguri plant आ रहा है, these two plants are in the totally different regions, जो हमको हमारा सीधा volume increase करने में directly impact करेगा। क्योंकि अभी हमारा market share वहां पर कुछ भी नहीं है। बहुत negligible है क्योंकि हमारा freight cost इतना ज्यादा होता है कि we are unable to service. जो हमारा Malur plant आ रहा है, this is totally different. यह 1 million ton का है। इतना detail product by product मैं नहीं दे सकता हूँ। Anubhav can talk one to one. हमारा 1 million का plant है, totally value added plant है, जहां पर we are thinking कि हमारा EBITDA margin INR 8,000 plus रहेगा।
Speaker #2: क्योंकि अभी हमारा market share वहाँ पर कुछ भी नहीं है, बहुत negligible है। क्योंकि हमारा freight cost इतना ज्यादा होता है कि we are unable to service.
Speaker #2: और जो हमारा मालूर plant आ रहा है, this plant is totally different. ये one million ton का है, इतना detailed product मैं नहीं दे सकता हूँ।
Speaker #2: ये अनुभव can talk one to one. ये but वो जो हमारा one million ton का plant है, totally value-added plant है जहाँ पर we are thinking कि हमारा जो margins of EBITDA margin है, 8,000 plus रहेगा.
[Analyst] (Nuvama Wealth Management): Understood sir. That was very helpful. Thanks a lot, sir. I will take the rest with Anubhav. Thank you so much.
Speaker #3: Understood, sir. That was very helpful. Thanks, thanks a lot, sir. I'll take the rest with Anubhav. Thank you so much.
Speaker #2: Thank you.
Sanjay Gupta: Thank you.
Speaker #3: All the best, sir.
[Analyst] (Nuvama Wealth Management): All the best.
Sanjay Gupta: Thank you.
Speaker #2: Thank you. Thank you.
Speaker #1: Thank you. The next question is from the line of Bharat Chah from BCS Capital Ideas Private Limited. Please go ahead.
Operator: Thank you. The next question is from the line of Bharat Shah from BCS Capital Ideas Private Limited. Please go ahead.
Speaker #4: संजय जी, नमस्कार.
Bharat Shah: Sanjay जी, नमस्कार।
Speaker #2: नमस्कार, भरत भाई, नमस्कार.
Sanjay Gupta: नमस्कार, भरत भाई नमस्कार।
Speaker #4: Namaskar. First of all, in a very challenging quarter, very difficult conditions, I think APL Apollo Tubes has performed with a great degree of aplomb, I must say.
Bharat Shah: नमस्कार। First of all, in a very challenging quarter, very difficult conditions, I think APL Apollo Tubes has performed with a great degree of aplomb, I must say. Because this has not been an easy quarter to deal with too many variables and too many challenges around. While there may be perception of some volume decline, but I would say it is a very creditable delivery in a very difficult quarter where too many things were reflecting a moving part challenges. Sanjay जी, at what stage, believe me, sometime next year, can we say that the focus on quarterly or periodic steel price fluctuation, volume up and down due to demand conditions we can reasonably leave behind and we can purely confidently focus on profitable growth in a very considered, predictable way with the rising share of value added products etc.
Speaker #4: Because this has not been an easy quarter to deal with, with too many variables and too many challenges around. So, while there may be perception of some volume decline, I would say it is a very creditable delivery in a very, very difficult quarter where too many things were reflecting a moving-part challenge.
Speaker #4: Sanjay ji, it works. Stage—believe me—sometime next year, we can be safe that the focus on quarterly or periodic steel price fluctuation, volume up and down due to demand conditions, we can reasonably leave behind. And we can purely, confidently focus on profitable growth in a very considered, predictable way.
Speaker #4: With the rising share of value-added products, et cetera, तो अगले साल में हम कह सकते हैं कि शायद we should be at that situation where, of course, volumes will grow with the strategy in our strong product portfolio.
Bharat Shah: तो अगले साल में हम कह सकते हैं कि शायद we should be at that situation where of course volumes will grow with the strategy in our strong product portfolio. Profitable growth in a very predictable way, हम अगले साल से शायद वह स्थिति में पहुंच जाएंगे।
Speaker #4: But profitful growth in a very predictable way, हम अगले साल से शायद वो स्थिति में पहुँच जाएँगे?
Speaker #2: Bharat bhai, if you look at the last one and a half years, earlier we were struggling for ₹4,000 per ton of EBITDA. Then we increased ourselves from ₹4,000 to ₹4,500 per ton.
Sanjay Gupta: Bharat Bhai, if you see last one and a half year, earlier we are struggling for INR 4,000 ton of EBITDA. we increased ourself to INR 4,000 to INR 4,500 per ton. From INR 4,500 to we stable ourselves to INR 5,000 per ton EBITDA margin. Now we are trying to reach the INR 5,500 EBITDA per ton quarter-on-quarter basis.
Speaker #2: From forty-five hundred to we stable ourselves into five thousand rupees per ton EBITDA margin. Now we are trying to reach the fifty-five thousand rupees per EBITDA per ton quarter on quarter basis.
Speaker #2: हम उसको पिछले दो-तीन quarters से काफी try कर रहे हैं कि हम 5,500 per ton margins को stable रखें। जिस तरह इस quarter में आप देखोगे, in spite of the cost increase by ₹1,000 per ton due to low volume, फिर भी हमने अपने margins को 5,500 पर maintain करके गए हैं।
Sanjay Gupta: हम पिछले दो-तीन quarter से काफी try कर रहे हैं 5,500 पर अपने margin को stable रखें। This quarter में आप देखोगे in spite of the cost increase by ₹1,000 ton due to low volume, फिर भी हमने अपने margin को 5,500 पर maintain करके दिया है। तो margin संभालना धीरे-धीरे मुझे लगता है stable होता जा रहा है। Volume there is no doubt कि scenario के हिसाब से थोड़ा सा up down हो रहा है। उसके अलावा मुझे लगता है जब मेरा Malur वाला plant आएगा अगले साल July-October quarter में, तो Q3 FY27 से मेरा यह भी challenge खत्म हो जाएगा। हम काफी stability volume as well as margin पर काफी stability आ जाएगी जब हमारा पूरा 7 million ton का capex plan खत्म होगा।
Speaker #2: तो margin संभालना धीरे-धीरे मेरे को लगता है stable होता जा रहा है। Volume, there is no doubt कि scenario के हिसाब से थोड़ा सा up-down हो रहा है।
Speaker #2: उसको भी मेरे को लगता है, जो मेरा मालूर वाला plant जब आएगा, ये मैंने अगले साल जुलाई-अक्टूबर quarter में, तो ये supplies Q3 से मेरा ये भी challenge खत्म हो जाएगा।
Speaker #2: हमारी stability volume as well as margin पर काफी आ जाएगी जब हमारा पूरा 7 million ton का CAPEX plant खत्म होगा तो।
Speaker #4: Q3 '27 मतलब December '26 की बात कर रहे हैं?
Bharat Shah: Q3 मतलब December 26 की बात कर रहे हैं।
Speaker #2: Next year December तक. Next year December तक.
Sanjay Gupta: Next year December.
Speaker #4: हाँ, December 27 की बात कर रहे हो न आप?
Bharat Shah: हाँ, December 27 की बात कर रहे हो ना आप?
Speaker #2: Yes, yes. Q4.
Sanjay Gupta: Yes. Q4, Q3.
Speaker #4: हाँ.
Speaker #2: ये Q3 या Q3? वहाँ पर हमारा जैसे बस 7 million ton का हमारा पूरा CAPEX plant पूरा खत्म होगा, तो हमारा जो business plan है, उसके हिसाब से हम इन चीजों से भी बाहर आ जाएँगे.
Bharat Shah: हाँ।
Sanjay Gupta: वहां पर जैसे ही 7 million ton का हमारा पूरा capex plan पूरा खत्म होगा तो हमारा जो business plan है, उसके हिसाब से हम इन चीजों से भी बाहर आ जाएंगे।
Speaker #4: बिल्कुल. मतलब second half या last quarter of next year?
Bharat Shah: Exactly. meaning H2 or Q4 of next year.
Speaker #2: Q4 28 की मैं ये Q4 27-28 Q4 हमारा एकदम stable quarter होगा जहाँ पर हम स्टॉकिंग, रि-स्टॉकिंग हो गया, प्राइसेस ऊपर-नीचे हो गया, अभी सब कहना छोड़ देंगे।
Sanjay Gupta: Q4, FY28 Q4। हमारे एकदम stable quarter होगा, जहां पर stocking disrupted हो गया, prices ऊपर-नीचे हो गया, यह सब कहना छोड़ देंगे।
Speaker #4: Bilkul. Matlab woh quarter se, Sanjay ji, hum us sthiti mein honge ki profitable predictability and its growth will be almost reasonably under our control, rather than worrying about many of these other variables which have engaged our mind time to time, sometime or the other.
Bharat Shah: बिल्कुल. मतलब वो quarter से Sanjay Ji हम उस स्थिति में होंगे कि profitable predictability and its growth will be Almost reasonably under our control, rather than worrying about many of these other variables which engage our mind time to time, sometime or the other. That will be fair.
Speaker #4: That will be fair?
Speaker #2: ये अभी भी है, but ठीक है, अभी I can say कि seventy to seventy-five percent है. वहाँ पर हम hundred percent हो जाएँगे.
Sanjay Gupta: अभी भी है, ठीक है। I can say कि 70, 75% है। वहां पर हम 100% हो जाएंगे।
Speaker #4: बिलकुल, समझ गया। और संजय जी, value added total product का share, जो हम 75-80% कह रहे हैं, वो कब तक हम expect करते हैं?
Bharat Shah: बिल्कुल, समझ गया। और Sanjay Ji, value-added product का share जो हम 75, 80% कह रहे हैं, वो कब तक हम expect करते हैं?
Speaker #2: वही, वही, वही हमारे मालूर plant से आएगा भरत भाई, ये 27 December तक। Q4 next year हमारा ये value added product का sale जो है 75 to 80 percent आ जाएगा।
Sanjay Gupta: वही हमारे Malur plant से आएगा, Balwant भाई, ये 27 December तक। Q4 next year हमारा ये value-added product का sale जो है 75 to 80% आ जाएगा।
Speaker #4: Fantastic. नहीं, once again, संजय जी.
Bharat Shah: Fantastic. नहीं, once again, Sanjay Ji.
Sanjay Gupta: Q4 next year FY2027, 2028 में Q4 quarter से हमारा value-added product का जो ratio है 75% cross कर जाएगा.
Speaker #2: Q4 Q4 next year twenty-five twenty-seven twenty-eight में Q4 quarter से हमारा value added का product का जो ratio है seventy-five percent cross कर जाएगा.
Speaker #4: समझ गया. Thank you, संजय जी, and once again, compliments to you and the APL Apollo team. In a very difficult situation, I would say, very impressive performance—congratulations.
Bharat Shah: समझ गया. Thank you, Sanjay Ji and once again compliments to you and APL Apollo team. In very difficult situation, I would say impressive performance. Congratulations.
Speaker #2: Thank you, Bharat bhai. Thank you, Bharat bhai, for showing confidence in us. ठीक है, कभी एक-आधा quarter हम ऊपर-नीचे हो जाएँ तो हमको माफ करना.
Sanjay Gupta: Thank you, Balwant भाई for showing confidence on us. ठीक है, कभी एक-आधा quarter मुंह पर भी चला जाए तो हमको माफ कर देना। बाकी हम अपनी तरफ से कभी कमी नहीं छोड़ेंगे।
Speaker #2: बाकी हम अपनी तरफ से कभी कोई नहीं छोड़ेंगे।
Speaker #4: नहीं, मैं तो कल, आज और परसों भी मानता हूँ कि संजय जी एक unique entrepreneur हैं इस देश के। So happy with that.
Bharat Shah: नहीं, मैं तो कल, आज और परसों भी मानता हूं कि Sanjay जी एक unique entrepreneur हैं इस देश के। Heartily wishes.
Sanjay Gupta: Thank you. So nice of you, Balwant भाई. हमारी पूरी कोशिश रहती है। हम अपनी तरफ से कोई कमी नहीं छोड़ेंगे। एकदम हमारे approach से ही बाहर हो जाए। हमारे approach में आप 0.1% भी कभी नहीं दिखा पाओगे।
Speaker #2: Thank you. So nice, so nice of you, Bharat bhai. Ab hamari poori koshish ho rahi hai, hum apni taraf se koi kami nahin chhodenge.
Speaker #2: एकदम हमारे approach से ही बाहर हो जाएँ। But हमारे efforts में आप point-one percent भी कभी नहीं दिखा पाओगे।
Speaker #4: Ji, ji, ji. Thank you, and all the best.
Bharat Shah: जी। Thank you and all the best.
Speaker #2: Thank you. Thank you, Bharat bhai.
Sanjay Gupta: Thank you, Balwant भाई.
Speaker #1: Thank you. We'll move on to the next question. That is from Akshay with AK Investments. Please go ahead.
Operator: Thank you. We'll move on to the next question that is on the line of Akshay from AK Investment. Please go ahead.
Speaker #5: Hi sir, thanks for the opportunity, and congratulations on the good set of numbers in a difficult time. So, sir, my first question is about EBITDA per ton.
[Company Representative] (AK Investment): Hi, sir. Thanks for the opportunity and congratulations on the good set of numbers in difficult times. Sir, my first question is about EBITDA per ton. As you have already guided that 5,000 to 5,500 will be the range for FY27. Going forward, in the FY28, FY29, how much EBITDA per ton are we expecting? How much year on year increment in EBITDA per ton are we expecting going forward?
Speaker #5: So, as you have already guided, the range for FY27 will be five thousand to fifty-five hundred. Going forward, in FY28 and FY29, how much EBITDA per ton are we expecting?
Speaker #5: How much year-on-year increment in EBITDA per ton are we expecting going forward?
Speaker #2: So, Akshay, see, I mean, right now the focus is to maintain EBITDA spreads between 5,000 to 5,500. Of course, the last two quarters have been good.
Anubhav Gupta: Akshay, see, right now the focus is to maintain EBITDA spreads between 5,000 to 5,500. Of course, last two quarters have been good at 5,500 per ton. Now that for the next nine months, we need to cover up on the volume which we lost. There could be some tweaking, which we did in our pricing, and there could be 100, 200 here and there of 450, 500.
Speaker #2: At five thousand five hundred per ton. But now that for the next nine months we need to cover up on the volume which we lost.
Speaker #2: So there could be some tweaking which we did in our pricing, and there could be a hundred to a hundred here and there of change. Then again, as the volumes ramp up, we could gain traction from the operating leverage benefits, which could come as a surprise.
Sanjay Gupta: Cover up also.
Anubhav Gupta: Again, as the volumes ramp up, we could gain traction from the operating leverage benefits, which could come as a surprise. We'll wait for that, how much it comes up. Going forward, as our more value-added product portfolio keeps on increasing, idea is to improve EBITDA spreads 100, 200 per ton on yearly basis. Our target is that Apollo at eight million tons should be generating ₹6,000 per ton EBITDA over the next two, three years when we ramp up this capacity.
Speaker #2: So, we'll wait for that and see how much it comes up. Going forward, as our more value-added product portfolio keeps on increasing, the right idea is to improve EBITDA spreads by ₹100 to ₹200 per ton on a yearly basis.
Speaker #2: And our our like our target is that Apollo at eight million ton should be should be generating six thousand rupees per ton. EBITDA right over the next two three years when we ramp up this capacity.
Speaker #5: Okay, sir. Fair enough. Thank you. Thank you for the opportunity. All the best.
[Company Representative] (AK Investment): Okay, sir. Fair enough. Thanks. Thank you for the opportunity. All the best.
Speaker #1: Thank you. The next question is from Dhananjay Bagrodia of Alchemy. Please go ahead.
Operator: Thank you. The next question is from the line of Dhananjay Bagrodia from Alchemy. Please go ahead.
Speaker #6: Hello. Hello. Hello.
Dhananjay Bagrodia: Hello.
Speaker #1: Yes sir.
Operator: Yes, please go ahead.
Speaker #6: So first, congratulations on a fantastic set of numbers on EBITDA per ton in such a tough environment. I wanted to understand, in pre-engineered buildings, do we have any thought process on how that could be for us, let's say, a year from today? Is that a segment we are looking at actively growing? And, with steel prices stabilized, should we then be targeting a higher EBITDA per ton?
Dhananjay Bagrodia: Firstly, congratulations on a fantastic set of numbers on EBITDA per ton in such a tough environment. Wanted to understand in pre-engineered buildings, do we have any thought process on how that could be for us? Let's say a year from today, is that a segment we are looking at actively growing it and B, with steel prices stabilized, should we be targeting a higher EBITDA per ton?
Speaker #2: So Dhananjay, currently, like for the pre-engineered building structures, twenty percent is steel pipes. Okay?
Anubhav Gupta: Dhananjay, currently, for the pre-engineered building structures, 20% is steel pipes. Okay?
Speaker #6: Yes.
Dhananjay Bagrodia: Yes.
Speaker #2: And it's a hundred-ton structure. Twenty percent, or twenty tons, is approximately steel pipe which is used, right? And the sizes range from 150 millimeter by 150 millimeter, and it goes up to 1,000 millimeter by 1,000 millimeter.
Anubhav Gupta: If it's 100 tons structure, 20 tons is approximate steel pipe which is used. The sizes range from 150 millimeter by 150 millimeter. It goes up to 1,000 millimeter by 1,000 millimeter, with thickness starting from 4mm in general and goes up to 40mm. In this category, our market share is again 65% to 70%. All the top PEB companies in India, they will be buying 60% to 70% of the requirement from APL Apollo. They buy from us directly also, and they also buy from our distributors. Larger players, they want to have contracts directly with APL Apollo, and medium to small size players, they buy through our distribution channel. It's a growing segment. We continue to focus heavily to service this industry.
Speaker #2: With thickness starting from four in general and going up to forty, right? So, in this category, our market share is again sixty-five to seventy percent.
Speaker #2: So, all the top PB companies in India—I mean, they will be buying sixty to seventy percent of their requirement from APL Apollo. They buy from us directly also, and they also buy from our distributors.
Speaker #2: Larger players they want to have contracts directly with Apollo and medium to small size players they buy through our distribution channel. So so it's a it's a it's a growing segment.
Speaker #2: Right? It's a growing segment, and we continue to focus heavily on servicing this industry.
Speaker #6: Okay. But is it a sector where we would look to directly speak to an end customer? Because if we have the raw material, we have the know-how. Is that something we would look to do more in depth?
Dhananjay Bagrodia: Is it a sector which we would look to directly speak to an end customer? Because if we have the raw material, we have the know-how, is that something which we would look to do more in depth?
Speaker #2: No, no, no. We are happy servicing this sector. That's all.
Anubhav Gupta: No, we are happy servicing this sector. That's all.
Speaker #6: Okay. Fine. Sure. Thank you so much.
Dhananjay Bagrodia: Okay, fair enough. Sure. Thank you so much.
Speaker #1: Thank you. A reminder to the participants: anyone wishing to ask a question may please press star and one (*1). The next question is on the line of Aditya Velekar from Access Securities.
Operator: Thank you. A reminder to the participants, anyone wishing to ask a question, may please press star and one. The next question is on the line of Aditya Welekar from Axis Securities. Please go ahead.
Speaker #1: Please go ahead.
Speaker #4: Yeah. Thank you for
Aditya Welekar: Yeah, thank you for the opportunity. My question is to Anubhav. Just wanted to understand what's happening between Q1 FY26 to Q1 FY27 on a year-on-year basis. We have seen that the volumes have declined, but EBIT per ton has increased. If I see the branded products where we earn higher premium, like APL Apollo brand and Dubai operations, the volumes have decreased. Despite of the low operating leverage and higher cost, our EBIT per ton has increased. Within this specific brand, APL Apollo brand, what's happening? Are we able to generate within the brand because of the product mix?
Speaker #6: Thank you for the opportunity. So, my question is just to confirm—I wanted to understand what's happening between Q1 FY26 and Q1 FY27 on a year-on-year basis.
Speaker #6: We have seen that the volumes have declined, but EBITDA per ton has increased. And if I look at the branded products, where we have a higher premium—like the APL Apollo brand—and the way operations are, the volumes have decreased. But despite the low operating leverage and higher costs, our EBITDA per ton has increased.
Speaker #6: So, within this specific brand—APL Apollo brand—what's happening? Are we able to increase or generate the brand because of the product? Make to understand.
Speaker #1: Sorry to interrupt, sir. Your voice is breaking up.
Operator: Sorry to interrupt, sir. Your voice is breaking up.
Speaker #6: Hello. Is it audible?
Aditya Welekar: Hello, is it audible now?
Speaker #1: Yes sir. Please proceed.
Operator: Yes, sir. Please proceed.
Speaker #6: Yeah, so my question is to Anubhav. I want to understand, on a year-on-year basis, if we see the EBITDA per ton has increased despite the drop in volumes. And within volumes also, if we see the branded products like APL Apollo brand and the way operations—the volumes have decreased—so despite the lower operating leverage, our EBITDA per ton has increased.
Aditya Welekar: My question is to Anubhav. I want to understand on a year-on-year basis, if we see the EBIT per ton has increased despite the drop in the volumes and within volumes, also, if we see the branded products like APL Apollo brand and Dubai operations, the volumes have decreased. Despite the lower operating leverage, our EBIT per ton has increased. I understand that we are increasing our value-added products, but on the face of it, if we see the absolute volumes of APL Apollo brand and Dubai operations, those have decreased. What explains this EBIT per ton increase on a year-on-year basis?
Speaker #6: So I understand that we are increasing our value-added products, but on the face of it, if we see the absolute volumes of APL Apollo brand and UAE operations, those have decreased.
Speaker #6: So, what explains this EBITDA per ton increase on a year-on-year basis?
Speaker #2: Aditya, this pertains to our pricing strategy, which we adopted in the month of January 2025, wherein we decided that we need to reposition APL Apollo branded products.
Anubhav Gupta: Aditya, this pertains to our pricing strategy, which we adopted in the month of January 2025, wherein we decided that we need to reposition APL Apollo branded products in the market, and we increased the pricing by almost INR 500 per ton. That is what boosted our EBIT spreads starting Q4 FY25 and all four quarters of FY26. You saw the better spreads, right? It continued in Q1 FY27. Despite the drop in volume, our better pricing strategy has worked to boost the EBIT spreads.
Speaker #2: Okay. In the market and we increase the pricing by almost five hundred rupees per ton. Okay. So that is what that is what boosted our EBITDA spreads starting Q4 FY25 and and all four quarters of FY26 I mean you saw the better spreads right and it continued in quarter one of FY27.
Speaker #2: So, despite the drop in volume, our better pricing strategy has worked to boost the EBITDA spreads.
Speaker #6: Okay. Understood. And second question Anubhav is on the solar opportunity. So if we if we if we refer to your slide we are saying almost thirty to thirty-five gigawatts of annual solar additions and that translates to almost eight thirty KT of addressable market.
Aditya Welekar: Okay, understood. Second question, Anubhav, is on the solar opportunity. If we refer to your slide, we are saying almost 30 to 35 GB of annual solar additions, and that translates to almost 830 KT of addressable market. So far are we catering to, so far have we started supplying to this market? Out of that total opportunity, how much is our share?
Speaker #6: So, so far, are we catering to—means, so far, have we started supplying to these markets, and out of the total opportunity, how much is our share?
Speaker #2: So yes, there are two or three types of products which we have launched in the market and which are supporting this there, right? Right now, the contribution is a bit low, but over the next two to three years, we expect this to contribute four to five percent to the total volume.
Anubhav Gupta: Yes, there are 2, 3 types of products which we have launched in the market and which is supporting this industry. The fraction is there, right? Right now the contribution is a bit low, but over the next two, three years, we expect this to contribute 4%, 5% to the total volume.
Speaker #6: Understood. The reason I'm asking is because this solar capacity addition, this LEP, has huge targets. I mean, at least this theme of solar capacity addition will...
Aditya Welekar: Understood. Why I'm asking because this solar capacity addition, this NSP has huge targets. This theme of solar capacity addition will persist for next five years and more. This will be an additional lever for our volumes if I understand.
Speaker #6: For the next five years and beyond, so this will be an additional lever for our volumes, if I understand correctly.
Speaker #2: Definitely, yes, Aditya, and that's why we got into this space. Like I said, we are as optimistic as the government is to boost the renewable energy contribution in India, and we have a good portfolio to support this industry as well.
Anubhav Gupta: Definitely, yes, Aditya, that's why we got into this space, like I said, we are as optimistic as the government is to boost their renewable energy contribution in India, we have a good portfolio to support this industry also.
Speaker #6: Okay, Anubhav. Thank you. That's it from my side.
Aditya Welekar: Okay, Anubhav. Thank you. That's it from my side.
Speaker #1: Thank you. The next question is from the line of Darshan Mehta from Daulat Capital. Please go ahead.
Operator: Thank you. The next question is on the line of Darshan Mehta from Dolat Capital. Please go ahead.
Speaker #6: Yeah, hi. Thanks for giving me the opportunity. So, my first question is for the SG Premium brand. How should we look at the realizations?
Darshan Mehta: Yeah. Hi. Thanks for giving the opportunity. My first question was for this SG Premium brand. How should we look at the realizations? I mean, what are the current realizations and what kind of EBIT per ton do you make in this product and how would that product grow as a percentage of total volumes for FY27 and FY28? That was my first question. Hello?
Speaker #6: I mean, what are the current realizations and what kind of EBITDA per ton do we make in this product? And how would that product go as a percentage of total volumes for FY27 and FY28?
Speaker #6: So that was my first question. Hello.
Speaker #2: Yeah. Darshan for SG Premium right now I mean the current pricing will be around fifty-eight thousand rupees per ton. Which is almost six to seven percent lower than brand APL Apollo products.
Anubhav Gupta: Yeah, Darshan. SG Premium right now, the current pricing will be around INR 58,000 per ton, which is almost 6% to 7% lower than brand APL Apollo products. EBIT spreads range from INR 0 to 1,000 per ton, depending on market opportunity, what kind of volume we want to gain in one micro market. EBIT spreads would vary from micro market to micro market. Okay? We also use this as strategy to boost volume, to cut down competition, to take market share from Patra players. It plays differently in different micro markets.
Speaker #2: EBITDA spreads range from zero to one thousand rupees per ton, depending on market opportunity and what kind of volume we want to gain in one micro-market.
Speaker #2: So EBITDA spread would vary from micro market to micro market. Okay. We also use this as a strategy to boost volume, to cut down competition, to take market share from Patra players.
Speaker #2: So, it plays differently in different micro markets.
Speaker #6: Okay. Okay. And so, currently, as you said, it is hovering around zero to one thousand rupees per ton, depending on the market conditions and the volumes you choose to make over here.
Darshan Mehta: Okay. Currently, as you said, it is hovering around INR 0 to 1,000 per ton, depending on the market conditions and the volumes you choose to make over here. Can, let's say, in next 2 years, I'm referring to, let's say, after FY28, can we see this INR 1,000 per ton increase to maybe around, let's say, INR 1,200, INR 1,500 per ton? Or you would basically say I mean, how are you looking at this product? Will you be making higher EBIT per ton or is it something to control the Patra players? Whenever you think you want to control Patra players, that is when you start delivering high volumes on this side. I just want to understand the strategy for this product.
Speaker #6: So, let's say in the next two years—I'm referring to after FY28—can we see this thousand rupees per ton increase to maybe around, let's say, twelve hundred or fifteen hundred per ton? Or would you basically... I mean, how are you looking at this product?
Speaker #6: Will will you be making higher EBITDA per ton or is it something to you know control the Patra players? Like whenever you think you want to control Patra players that is when you start you know delivering high volumes on this side or so I just want to understand the strategy for this product.
Speaker #2: Darshan, good morning. It's not my own strategy. This is totally play, and it's to capture the market share. This is totally dependent on the pricing difference between the primary and the secondary.
Sanjay Gupta: Darshan.
Sanjay Gupta: Good morning. इसमें भाई कोई strategy नहीं है। This is totally play and it will capture the market share, and this is totally dependent on the pricing of the difference between the primary and the secondary. अगर primary और secondary में gap, जो आज की date में INR 10 to INR 12 per kg का है, तो इसमें हमारे हाथ में कोई ज्यादा play नहीं है, और कोई cash loss करके हमको माल बेचने का कोई benefit नहीं है। This gap when come down to Q4, INR 3, INR 4, INR 5 per kg, then this become a master stroke. तब इसमें हमारी EBITDA margin भी 1,500, 2,000, 3,000 आ सकता है, और इसमें हम बड़ा volume खेल सकते हैं। This strategy totally depends on the difference between secondary and primary pricing.
Speaker #2: Our primary or secondary में gap, जिसका आज के date में 10-12 रुपए किलो का है. तो इसमें हमारे हाथ में कोई ज्यादा play नहीं है और हम कोई cash loss करके माल बेचने का कोई benefit नहीं है.
Speaker #2: But this gap, when it comes down to four—like in quarter four, three or four rupees, five rupees per KG—then this becomes a master stock. तब इसमें हमारा EBITDA margin भी पंद्रह सौ, दो हजार, तीन हजार भी आ सकता है.
Speaker #2: और इसमें हम बड़ा volume भी खेल सकते हैं. But this strategy is totally dependent on how the secondary and the primary pricing, the difference between the secondary and primary pricing.
Speaker #2: क्योंकि आज दस-बारह रुपए का gap है। हम दो रुपए किलो सस्ता भी करके बेच देंगे, हमारा ज्यादा volume नहीं होगा। But जब हमारा ये gap चार-पाँच रुपए किलो का होगा, तो हम दो रुपए किलो सस्ता करके बेचते हैं, तो हमारा volume बहुत होता है।
Sanjay Gupta: क्योंकि आज ₹10 से ₹12 का gap है। हम ₹2 kilo सस्ता भी करके बेचते हैं तो हमारा ज्यादा volume नहीं होगा। जब हमारा यह gap ₹400, ₹500 kilo का होगा, तब ₹2 kilo सस्ता करके बेचते हैं तो हमारा volume बहुत होता है। तो इस समय यह जो हमने plan बनाया था, based off of gap between the secondary and the primary, can't work.
Speaker #2: So at this time, the plan we had made with the stuff regarding the gap between the secondary and the primary can't work.
Speaker #6: Okay. Thank you, Sanjay ji. And sir, the Gorakhpur capacity would be coming in Q3, you said, right? So there are two—yes—and one more capacity you said would be coming in Q4.
Darshan Mehta: Okay. Thank you, Sanjay. Sir, this Gorakhpur capacity would be coming in Q3, you said, right? One more capacity you said would be coming.
Sanjay Gupta: Siliguri.
Speaker #6: Which one? अच्छा सिलीगुड़ी.
Darshan Mehta: Which one?
Sanjay Gupta: Siliguri.
Speaker #2: सिलीगुड़ी.
Speaker #6: Okay. Okay. So, basically, I think when you are saying this 20-50%, 20% volume growth, you are—I think this whole capacity...
Darshan Mehta: Okay. Basically, I think when you are saying this 20% volume growth, I think this whole capacity.
Speaker #2: जब मैं twenty percent twenty percent growth का जो मैं कह रहा हूँ तो उसमें मेरा गोरखपुर भी play करेगा सिलीगुड़ी भी play करेगा and export market जिसपे हमने काफी काम किया दुबई and as well as अभी तो इंडिया से export बंद हुआ हुआ है due to high container prices.
Sanjay Gupta: 20% growth का जो मैं कह रहा हूँ, तो उसमें Gorakhpur भी play करेगा, Siliguri भी play करेगा, and export market, जिस पर हमने काफी काम किया है Dubai and as well as अभी India से export बंद हुआ है due to high container prices. वो जैसे slow down होगा container prices, तो हमारा export भी बहुत बढ़ेगा। तो ये दो-तीन factors भी इसमें include हैं।
Speaker #2: वो जैसे slow down होगा container prices, तो हमारा export भी बहुत बढ़ेगा। तो ये दो-तीन factor भी उसमें include हैं।
Speaker #6: And and sir.
Darshan Mehta: And sir-
Speaker #2: So volume देंगे.
Sanjay Gupta: they will add for volume.
Speaker #6: Sure. Sir, earlier I think this was the plant at West Coast—I think we were thinking about Bhuj, right? So now that Bhuj is out, and I think maybe...
Darshan Mehta: Sir, earlier I think this the plant at West Coast, I think we were thinking about Bhuj. Now that Bhuj is out.
Speaker #2: We changed our plan from Bhuj to—we shifted to our Mumbai plant, because our Mumbai plant, जो हमारा था, उसको हमने export पर shift करते जाना है पूरा.
Sanjay Gupta: We changed our plan. From Bhuj we shifted to our Mumbai plant. Mumbai plant जो हमारा था, उसको हमने export पर shift करते जा रहे हैं पूरा। अभी हम जो Mumbai से Pune market सब capture करते थे, we have a freight cost of almost ₹1,100, ₹1,200 per ton. अब हम जो नया plant 5 lakh ton का लगा रहे हैं, हम around Pune corridor के आसपास लगाएंगे, जहां से हमारा freight cost भी Pune market के लिए ₹200, ₹300 per ton रह जाएगा।
Speaker #2: Because, and right now, the Mumbai to Poona market that we cater to, we have a freight cost of almost eleven hundred to twelve hundred rupees per ton.
Speaker #2: तो अब हम जो नया plant पाँच लाख टन का लगा रहे हैं, हम around यह Poona corridor के आसपास लगाएंगे, जहाँ से हमारा freight cost भी Poona market के लिए 200–300 rupees per ton रह जाएगा.
Speaker #6: Okay. And sir, we have made some investment in this group shared services company. तो ये company का what would be the function and what purpose will it serve?
Darshan Mehta: Okay. Sir, we have made some investment in this group shared services company. This company, what would be the function and what purpose will it serve?
Speaker #2: ये ये एक छोटा सा company हमने चालू किया जिसका हमारी बहुत सारी जो common ये activities होती है like HR IT branding ये सब जो हम group level पर इकट्ठा करके उसको पूरे में deal business करना चाहते हैं कि हमारा उससे cost अभी हर depart हर company का एक अलग अलग हमारे पास HR head है.
Sanjay Gupta: यह एक छोटा सा company हमने चालू किया है, जिसमें बहुत सारी जो common activities होती हैं, like HR, IT, branding, ये सब हम group level पर इकट्ठा करके उसको पूरे में visualize करना चाहते हैं कि हमारा उसका cost अभी हर company का एक अलग-अलग हमारे पास HR head है। हर company में एक अलग-अलग IT head है। तो हमने कुछ cost company बना के सारा उसको हम contract देके अपनी cost को कम करना चाहते हैं।
Speaker #2: हर कंपनी में एक अलग-अलग IT हेड है। तो हमने कुछ कॉस्ट कंपनी बनाके, सारा उसको हम कॉन्टैक्ट देकर अपनी कॉस्ट को कम करना चाहते हैं।
Speaker #6: Okay, okay. So we were saying that there would be a common HR head for maybe SG Mart and our जो group company है.
Darshan Mehta: Okay. You are saying there would be a common HR head for maybe SG Mart and our जो group companies हैं.
Speaker #2: SG, SG, and APL Apollo, as well as Apollo Pipe.
Sanjay Gupta: APL Apollo as well as Apollo Pipe.
Speaker #6: Understood. Understood, sir. Thank you. Thank you very much.
Darshan Mehta: Understood, sir. Thank you very much.
Speaker #1: Thank you. The next question is from the line of Andre Purushottam from Kojiro Advisors. Please go ahead.
Operator: Thank you. The next question is in the line of Anirudh Purushothaman from Cogito Advisors. Please go ahead.
Speaker #4: Thank you for taking my question. Congratulations on a good performance in difficult conditions. I just had a very small question. Your employee costs last quarter have gone up significantly.
Anirudh Purushothaman: Thank you for taking my question. Congratulations for a good performance in difficult conditions. I had a very small question. Your employee costs last quarter have gone up significantly. Is there an explanation of that and how should we look at this employee cost going forward? Is it likely to remain, and is that going to have any effect on ramping budgets?
Speaker #4: So, is there an explanation for that, and how should we look at this employee cost going forward? Is it likely to remain, and is that going to have any effect on that thing?
Speaker #2: Boss, due to the low percentage, costs are going high. Of course, plus some part of annual increment.
Sanjay Gupta: Boss, due to low production the employee cost has gone high.
Darshan Mehta: Annual increment.
Sanjay Gupta: Plus it's a sub-part of annual increment.
Speaker #4: Sorry?
Anirudh Purushothaman: Sorry?
Speaker #2: कुछ annual increment के कारण ही हमारा employee cost बढ़ा है जो annual हमारा increment होता है. And number. हाँ yeah yeah. And number two जो हमारा per ton पे अगर आप देखोगे तो ये due to हमारा low percentage के कारण employee cost बढ़ा है.
Sanjay Gupta: कुछ annual increment के कारण ही हमारा employee cost बढ़ा है। जो annual हमारा increment होता है। Number two, हमारा per ton तो अगर आप देखोगे तो यह due to हमारे low production के कारण employee cost बढ़ा है। अगर amount wise देखोगे तो increment के कारण बढ़ा है।
Speaker #2: अब अगर amount-wise देखोगे तो increment के कारण बढ़ा है।
Speaker #4: ठीक है, तो मतलब ये बिलकुल normal है, इसमें कोई खास वजह नहीं है इसकी.
Anirudh Purushothaman: ठीक है। तो मतलब यह बिल्कुल normal है। इसमें कोई खास वजह नहीं है।
Speaker #2: नहीं, नहीं, नहीं, normal है। वो इस quarter में जैसे मतलब volume track पर लाएंगे, तो हमारा वापस कम हो जाएगा।
Sanjay Gupta: नहीं, normal है। इस quarter में जैसे ही हमारा volume track पर लाएंगे तो हमारा वापस कम हो जाएगा।
Speaker #4: ठीक है, ठीक है. Thank you. Thank you, sir.
Anirudh Purushothaman: ठीक है। Thank you, sir.
Speaker #1: Thank you. The next question is from the line of Vikas Singh from ICICI Securities. Please go ahead.
Operator: Thank you. The next question is on the line of Vikas Singh from ICICI Securities. Please go ahead.
Speaker #6: Good afternoon, sir, and thank you for the opportunity. Sir, this quarter पे अपना value added versus general product का mix क्या था? And secondly, like you said, के previous year आपने एक concept decision लिया था के आप price नहीं गिराओगे.
Vikas Singh: Good afternoon, sir, and thank you for the opportunity. Sir, इस quarter पे अपना value added versus general product का mix क्या था? Secondly, like you said that previous year आपने conscious decision लिया था कि आप price नहीं गिराओगे. Looking at current commentary in order to gain the market share, are we reversing that strategy and now will go for a higher volume even if it is in general category versus the pricing management?
Speaker #6: But looking at current commentary, in order to gain market share, are we reversing that strategy and now will go for higher volume even if it is in the general category, versus the pricing management?
Speaker #2: Boss it's not define करना बड़ा मुश्किल होता है but some of the our product range of fifty total basket का fifteen point fifteen twenty percent में we have done some aggressive pricing pricing policy.
Sanjay Gupta: Boss, इतना define करना बड़ा मुश्किल होता है, some of our product range of total basket का 15% to 20% we have done some addressing pricing policy.
Speaker #4: So, Vikas, this is for the 20 percent of the portfolio, not across the segment. We are saying we will reduce the pricing only for the 20 percent of the portfolio. We have tweaked some pricing to gain volume.
Anubhav Gupta: Because this is for the 20% of the portfolio, not across the segment that we are saying we will reduce the pricing only for the 20% of the portfolio, we have tweaked some pricing to gain volumes.
Speaker #6: ठीक है. नहीं, क्योंकि अगर मैं देखूं कि अगर मैं एक million ton भी इस quarter पे कर लेता हूँ, despite monsoon, मेरा asking rate would be चार लाख ton per month, to which even the fifteen percent volume growth...
Sanjay Gupta: ठीक है। नहीं, क्योंकि अगर मैं देखूं कि अगर मैं 1 million ton भी इस quarter पे कर लेता हूँ despite monsoon, मेरा asking rate would be 4 लाख ton per month to reach even the 15% volume growth. तो एक additional per month मैं कहाँ से करूँगा? और it would be more of a general or value added यह major concern था मेरा। Boss, इसको इतना brief define करना बड़ा मुश्किल है। हमारे इतना clear है हम लोग कि हमने 3 लाख ton July में कर लिया है। 3.25-3.35 के आसपास we are targeting in August and September we are targeting 3.5 plus. अब उसमें किस segment में 10,000 ton फालतू बिकेगा, जिसमें 10,000 ton बिकेगा, इसको we can't explain boss, नहीं possible है।
Speaker #6: तो एक additional per month मैं कहाँ से करूँगा और it would be more of a general और value-added, ये measure concern था मेरा.
Speaker #2: Boss, इसको इतना brief define करना बड़ा मुश्किल है, boss. मतलब हमारा इतना clear है आपको कि हमने तीन लाख टन जुलाई में कर लिया है.
Speaker #2: Three point five लाख ton we have three point two five three point three point three five के आसपास हम we are targeting August and सितंबर we are targeting three point five plus.
Speaker #2: अब उसमें किस segment में 10 लाख टन फालतू बिकेगा, किसमें 10 लाख कम बिकेगा, इसको we can't explain, boss, नहीं possible है.
Speaker #6: No, समझ गया sir. खाली इस quarter पे मेरा general product का percentage क्या था, ये बता दीजिए आप.
Anubhav Gupta: समझ गया sir. खाली इस quarter पे मेरा general product का percentage क्या था, यह बता दूँगा आप।
Speaker #4: Total thirty-five percent.
Sanjay Gupta: Total 35% के आसपास था।
Speaker #2: Thirty-five percent के आसपास था.
Speaker #4: ठीक है sir.
Anubhav Gupta: ठीक है। मेरी तरफ से इतने। धन्यवाद।
Speaker #6: मेरी तरफ से इतना ही। धन्यवाद।
Speaker #2: Thank you जी.
Sanjay Gupta: Thank you.
Speaker #1: Thank you. The next question is from Dugesh Shukla of Incorrect Capital. Please go ahead.
Operator: Thank you. The next question is from the line of Ganesh Shukla from Incred Capital. Please go ahead.
Ganesh Shukla: Hello sir. Thank you for the opportunity. I just wanted to confirm one thing. Actually, we were not audible that time. The guidance for this year EBITDA growth for the whole FY27 is 20% and the volume growth guidance is also same, right?
Speaker #6: Hello, sir. Thank you for the opportunity. I just wanted to confirm one thing. Actually, you were not audible at that time. The guidance for this year’s EBITDA growth for the whole FY27 is 20%, and the volume growth guidance is also the same, right?
Speaker #2: It's fifteen to twenty percent.
Sanjay Gupta: It's 15% to 20%.
Speaker #6: Volume is 15–20 percent, and EBITDA is 20 percent.
Ganesh Shukla: Volume is 15% to 20% and EBITDA is 20%.
Sanjay Gupta: Sir, more than 20%.
Speaker #2: More than twenty percent.
Speaker #6: Sorry. EBITDA is more than 20%.
Ganesh Shukla: Sorry, EBITDA is more than 20%.
Speaker #2: And volume growth is 15 to 20 percent.
Sanjay Gupta: Volume will be 15% to 20%.
Speaker #6: And what about, sir, the next financial year? Any guidance for FY 2028?
Ganesh Shukla: What about next financial year? Any guidance on that?
Speaker #2: अभी, boss, अभी तो एक-एक महीने का कहना मुश्किल है। हमारा target तो हमेशा 20% plus रहता है।
Sanjay Gupta: अभी एक-एक महीने में करना मुश्किल है। हमारा target तो हमेशा 20% रहता है।
Speaker #6: Okay. Okay, sir. That's it from my side. Thank you.
Ganesh Shukla: Okay sir. That's it from my side. Thank you.
Speaker #2: Thank you.
Sanjay Gupta: Thank you.
Speaker #1: Thank you. The next question is from the line of Rajesh Ravi from HDFC Securities. Please go ahead.
Operator: Thank you. The next question is from the line of Rajesh Ravi from HDFC Securities. Please go ahead.
Speaker #6: Hi sir, good afternoon, and congratulations on this set of numbers and the margins. My question pertains to the change in volume reporting that you have done this quarter, which I believe is more representative of the business.
Rajesh Ravi: Hi sir, good afternoon and congrats on this set of numbers on the margin front. My question pertains to first, the change in volume reporting which you have done this quarter, which I believe is more representative of the business. Would you also like to share the EBITDA per ton number for this segment as you were declaring earlier across Apollo Structural, Apollo Z, and Apollo Galvanized. For the new business segments, the new reporting segments that you have created, would you like to report the EBITDA margin number also? Am I audible?
Speaker #6: So, would you also like to share the EBITDA quarter number for the segment, as you were, you know, declaring earlier across the whole structure of both APL Apollo and Apollo Galvanize?
Speaker #6: So, for the new business segments now, you know, the new reporting segments that you have created, would you like to report the EBITDA margin number also?
Speaker #6: Am I audible?
Speaker #2: Yeah, so Rajesh, see, I mean there are like four broad categories: Apollo branded products, SG premium branded products, UAE operations, and roofing products.
Anubhav Gupta: Yeah. Rajesh.
Rajesh Ravi: Yeah.
Anubhav Gupta: See, I mean, there are four broad categories: Apollo branded products, SG Premium branded products, UAE operations, and roofing products.
Speaker #2: So Rajesh इसमें Apollo and roofing products में we are targeting six thousand to seven thousand is per ton. EBITDA target. SG premium around five hundred rupees per ton.
Sanjay Gupta: Rajesh, इसमें Apollo and roofing products में we are targeting INR 6,000 to INR 7,000 per ton, EBITDA target. SG Premium around INR 500 per ton. And UAE को अभी कुछ भी define करना थोड़ा बहुत मुश्किल है। वहां क्या volume कर पाते हैं, क्या वहां पर cost of raw material proportion रहता है, उस पर बहुत depend करेगा। उसको सब define करना आज की date में थोड़ा बहुत मुश्किल है।
Speaker #2: And UAE को अभी कुछ भी define करना थोड़ा सा मेरे लिए मुश्किल है. वहां क्या volume कर पाते हैं, क्या वहां पे cost of हमारा personnel रहता है, उस पर बहुत depend करेगा. उसको थोड़ा define करना आज की date में थोड़ा सा मुश्किल है.
Rajesh Ravi: Mm-hmm।
Speaker #2: But अगर वो ramp up हो गया, तो वो भी जाएगा.
Sanjay Gupta: अगर वो ramp up हो गया तो वो भी 6,000 के आसपास आ जाएगा।
Speaker #6: Okay. And roofing also, you are counting in the 6,000–7,000 bracket, right?
Rajesh Ravi: Okay, roofing also you are accounting in the 6,000, 7,000 bracket, right?
Speaker #2: हाँ, अभी हम तो चल रहे हैं six to seven thousand के बीच में चल रहे हैं।
Sanjay Gupta: हां, अभी तो चल रहा है 6 से 7,000 के बीच में।
Speaker #6: Understood. No, I was referring to earlier in preceding quarters in your presentation—you used to say segmental EBITDA margins, you know? So I was talking from that perspective. Would you like to start with that practice? We have given the volumes for the past two years, you know, so a like-to-like comparison?
Rajesh Ravi: Understood. No, I was referring to earlier in preceding quarter in your presentation, you used to say segmental EBITDA margin. I was talking from that perspective. Would you like to start with that practice? We have given the volumes for past two years for like to like comparison.
Sanjay Gupta: Rajesh, हमारे business से बहुत impact आ रखा है with the competitors. जिस भी सेगमेंट हमारा मार्जिन ज्यादा रहता था वहीं पर ज्यादा हिट करते थे। इसलिए technically point of view से हमने उसको खत्म किया है, जानबूझकर।
Speaker #2: Rajesh sir, हमारे business में बहुत impact आ रहा था. With the competitors, GP sir, हमारा margin ज्यादा निकले तो वही पे ज्यादा hinge करते थे.
Speaker #2: इसी technical point of view से हमने उसको खत्म किया, जान उसका।
Speaker #6: No issue sir. Understood understood sir. Sir coming on to the volume growth even if I look at fifteen percent full year volume growth target do you do you believe there is a risk of you know missing that guidance because given the Q2 traction which you have mentioned volume in Q2 may be higher by ten to fifteen percent year on year and hence the second half H2 the volume requirement would be closer as you know one of the earlier participant asked the ask rate for H2 will be closer to four lakhs per ton on a monthly rendered basis.
Rajesh Ravi: No issues, sir. Understood, sir. Sir, coming on to the volume growth, even if I look at 15% full year volume growth target, do you believe there is a risk of missing that guidance? Because given the Q2 traction which you have mentioned, volume in Q2 may be higher by 10% to 15% year on year, hence the H2, the volume requirement will be closer as one of the early participant asked, the ask rate for H2 will be closer to 4 lakh per ton on a monthly run rate basis.
Speaker #6: So first yeah.
Speaker #2: Rajesh, हमारा main जो main gain play करेगा Q4 करेगा. And technically पूछोगे तो Q1 हमारा साढ़े सात लाख ton के आसपास हुआ है. Q2 we are targeting about 10 lakh ton.
Sanjay Gupta: Raj, हमारा जो main game play करेगा, Q4 करेगा। Technically पूछोगे तो Q1 हमारा 7.5 लाख ton के आसपास हुआ है। Q2 we are targeting about 10 लाख ton. Q3 we are targeting 10.5 लाख ton के आसपास करेंगे target. Q4 में full capacity जो हमारा 5.2 million ton plus गोरखपुर और सिलीगुड़ी हमारा start हो जाएगा, तो वहां पर हम full 12 लाख ton करने की कोशिश करेंगे।
Speaker #2: Q3, we are targeting around 10.5 lakh tons. In Q4, we will reach full capacity, which is 5.2 million tons, plus our Gorakhpur and Siliguri plants will also start operations.
Speaker #2: तो वहाँ पे हम फुल 12 लाख टन करने की कोशिश करेंगे।
Speaker #6: Understood, understood. But sir, what will drive the volume growth? Will your Apollo brand or the SG premium take a massive share?
Rajesh Ravi: Understood. इसमें sir, what will drive the volume growth? Your Apollo brand or the SG Premium will take massive share?
Speaker #2: No, no, Apollo brand roofing and SG Premium—right now we can't say anything about those. That will depend on whether it's a secondary or primary difference.
Sanjay Gupta: Apollo brand roofing and SG Premium का तो अभी हम कुछ नहीं कह सकते हैं। वो तो secondary या primary के difference के ऊपर depend करेगा। Mainly तो Apollo brand UAE and roofing product के ऊपर depend होगा।
Speaker #2: Mainly तो Apollo brand UAE और roofing product के ऊपर depend होगा.
Speaker #6: Understood. So I was just trying to understand, when you, you know, ride this strong growth, your margins of this 5,500 may not be at risk.
Rajesh Ravi: Understood. I was just trying to understand when you ride this strong growth, your margins of this INR 5,500 may not be at risk. This is what the basic purpose of the thing.
Speaker #6: This is what the basic purpose of the thing is.
Speaker #2: Boss sir, अभी Rajesh, दो-तीन चीजें, अभी के pricing policy के हिसाब से, हमें 200-300 rupees का hit है. But लगता है, हम जैसे ही operational leverage पे जाएंगे, तो वो cover up हो जाएगा.
Sanjay Gupta: राजेश, दो-तीन चीजें अभी के pricing policy के हिसाब से ₹200-₹300 का hit है हमको। लगता है जैसे ही operational leverage पर जाएंगे तो वो cover up हो जाएगा।
Speaker #6: Understood. Understood. So, anything north of 5,000 is doable.
Rajesh Ravi: Understood. Anything north of INR 5,000 is doable.
Speaker #2: No, no, five thousand से ऊपर-नीचे जाने का कोई मतलब ही नहीं है.
Sanjay Gupta: 5000 से below नीचे जाने का कोई मतलब ही नहीं है।
Speaker #6: Understood. Understood.
Rajesh Ravi: Understood.
Speaker #2: Rajesh, just to add to it and close your question, by saying that we are targeting 20% EBITDA growth on an absolute basis, right?
Anubhav Gupta: Rajesh, just to add to it and close your question by saying that we are targeting 20% EBITDA growth on absolute basis. That is the goal post for us. Volume is 15%, 16%, 17% growth. EBITDA pattern is INR 5,500, INR 5,600, INR 5,400. That will depend on quarter on quarter how things shape up. Our goal post is 20% EBITDA growth on absolute basis.
Speaker #2: So so that is the goal post for us. Now volume is fifteen percent sixteen percent seventeen percent growth. EBITDA per ton is fifty-five hundred fifty-six hundred fifty-four hundred.
Speaker #2: That will depend, quarter on quarter, on how things shape up. But our goalpost is twenty percent EBITDA growth on an absolute basis.
Speaker #6: Understood. Twenty percent absolute EBITDA growth—that's great. I'll come back in two. Thank you, and all the best.
Rajesh Ravi: Understood. 20% absolute EBITDA growth. That's great. I'll come back and see. Thank you and all the best.
Speaker #2: And our target is to come back to quarter ROC, which was around 30%. Our target is to bring it back to around 40%.
Sanjay Gupta: हमारा target है कि इस quarter में जो हमारा ROCE 30% के आसपास था, उसको वापस 40% के आसपास लाना।
Speaker #6: Super, great, sir. I'll come back in two. Thank you.
Rajesh Ravi: Superb. Great, sir. I'll come back and see. Thank you.
Speaker #2: Thank you.
Sanjay Gupta: Thank you.
Speaker #1: Thank you. Ladies and gentlemen, that was the last question. I will now hand the conference over to the management for closing comments.
Operator: Thank you. Ladies and gentlemen, that was the last question. I now hand the conference over to the management for the closing comments.
Speaker #2: Thanks, everyone, for joining our call, and apologies again for starting this call a bit late. Thanks, Antique, for hosting us. Look forward to seeing you again.
Anubhav Gupta: Thanks everyone for joining our call and apologize again to start this call a bit late. Thanks Antique for hosting us. Look forward to see you again. Thank you everyone. Have a good day.
Speaker #2: Thank you, everyone. Have a good day.
Speaker #1: Thank you, members of the management team. Ladies and gentlemen, with that, we conclude today's conference. We thank you for joining us, and you may now disconnect your lines.
Operator: Thank you members of the management team. Ladies and gentlemen, with that we conclude today's conference. We thank you for joining us and you may now disconnect your lines. Thank you.
