Q1 2027 JTL Industries Ltd Earnings Call

August 5, 2026

Operator: Ladies and gentlemen, thank you for your patience. We will be beginning with the conference soon. Thank you. Ladies and gentlemen, good day and welcome to the JTL Industries Limited Q1 FY27 conference call. 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 this conference call, please signal an operator by pressing star then zero on your touchtone phone. Please note that this conference is being recorded. I now hand the conference over to Miss Sneha Talreja from Nuvama. Thank you and over to you.

Operator: Ladies and gentlemen, good day and welcome to the JTL Industries Limited Q1 FY27 conference call. 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 this conference call, please signal an operator by pressing star then zero on your touchtone phone. Please note that this conference is being recorded. I now hand the conference over to Mrs. Sneha Talreja from Nuvama. Thank you and over to you.

Speaker #1: As a reminder, all participant lines will be in listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes.

Speaker #1: Should you need assistance during this conference call, please signal an operator by pressing star, then zero, on your touch-tone phone. Please note that this conference is being recorded.

Speaker #1: I now hand the conference over to Ms. Neha Talreja from Nuwama. Thank you, and over to you.

Speaker #2: Thank you, Ananya. Good afternoon, everyone. I warmly welcome everybody to JTL Industries' Q1 FY27 earnings concall. On the management side, today we have with us Mr. Pranav Singha, Executive Director; Mr. Dhruv Singha, Executive Director; and Mr. Naveen Laroya, CFO.

Sneha Talreja: Thank you, Ananya. Good afternoon, everyone. I warmly welcome everybody to JTL Industries Q1 FY27 earnings con call. On the management side, today we have with us Mr. Pranav Singla, Executive Director, Mr. Dhruv Singla, Executive Director, and Mr. Naveen Laroya, CFO. Without taking any more time, I will now hand over the call to Mr. Naveen. Sir, over to you, sir, for your opening remarks.

Sneha Talreja: Thank you, Ananya. Good afternoon, everyone. I warmly welcome everybody to JTL Industries Q1 FY27 earnings con call. On the management side, today we have with us Mr. Pranav Singla, Executive Director, Mr. Dhruv Singla, Executive Director, and Mr. Naveen Laroiya, CFO. Without taking any more time, I will now hand over the call to Mr. Naveen. Sir, over to you, sir, for your opening remarks.

Speaker #2: Without taking any more time, I will now hand over the call to Mr. Naveen. Sir, what are your thoughts for your opening remarks?

Speaker #3: Good afternoon, everybody. This is Naveen Laroya, CFO of JTL Industries Limited. I thank you all for joining the earnings conference call of JTL Industries Limited to discuss the performance for Q1 of financial year 2025.

Naveen Kumar Laroiya: Good afternoon, everybody. This is Naveen Laroiya, CFO of JTL Industries Limited. I thank you all for joining the earnings conference call of JTL Industries Limited to discuss the performance for Q1 FY25. FY27, sorry. We appreciate your continued support and interest in our company. The company achieved its highest-ever quarterly revenue from operations and EBITDA in Q1 FY27. Revenue from operations reached INR 722 crores, while EBITDA was INR 59 crores with a margin of 8.1%. Profit after tax for the quarter was INR 35 crores with a margin of 4.9%. That of INR 35 crores was after an INR 2.8 crores of additional non-cash depreciation arising from the March 2026 valuation at JTL Defence Limited, erstwhile RCI Industries & Technologies Limited. The company has reported a sales volume of 118,513 metric tons during Q1 FY27, reflecting 17.8% year-on-year growth.

Naveen Laroiya: Good afternoon, everybody. This is Naveen Laroiya, CFO of JTL Industries Limited. I thank you all for joining the earnings conference call of JTL Industries Limited to discuss the performance for Q1 FY25. FY27, sorry. We appreciate your continued support and interest in our company. The company achieved its highest-ever quarterly revenue from operations and EBITDA in Q1 FY27. Revenue from operations reached INR 722 crores, while EBITDA was INR 59 crores with a margin of 8.1%. Profit after tax for the quarter was INR 35 crores with a margin of 4.9%. That of INR 35 crores was after an INR 2.8 crores of additional non-cash depreciation arising from the March 2026 valuation at JTL Defence Limited, erstwhile RCI Industries & Technologies Limited. The company has reported a sales volume of 118,513 metric tons during Q1 FY27, reflecting 17.8% year-on-year growth.

Speaker #3: We, 27, sorry. We appreciate your continued support and interest in our company. The company achieved its highest-ever quarterly revenue from operations and EBITDA in Q1 FY27.

Speaker #3: Revenue from operations reached ₹722 crores, while EBITDA was ₹59 crores, with a margin of 8.1%. Profit after tax for the quarter was ₹35 crores, with a margin of 4.9%.

Speaker #3: That figure of ₹35 crore is after an additional non-cash depreciation of ₹2.8 crore arising from the March 2026 asset revaluation at JTL Defense Limited. As to while RCI Industries and Technologies Limited—.

Speaker #3: The company has reported a sales volume of 118,513 metric tons during Q1 FY27, reflecting 17.8% year-on-year growth. Operational revenue per ton increased to 6,882, while operational EBITDA per ton, without other income, improved to 4,954 per metric ton—supported by an improved product mix and continued focus on operational efficiencies.

Naveen Kumar Laroiya: Operational revenue per ton increased to INR 68.82, while operational EBITDA per ton without other income improved to INR 4,954 per metric ton, supported by an improved product mix and continued focus on operational efficiencies. During the quarter, the company continued to strengthen its presence across key end-user industries through its value-added product portfolio. DFT structural steel pipes continued to gain acceptance across the dealer network and industrial applications, supported by improved production and capacity utilization at the Mangaon facility. The quarter also marked progress in strengthening the company's presence in the water infrastructure segment with the receipt of INR 27 crores order for the supply of galvanized iron pipes for water supply and distribution projects in Himachal Pradesh. This order reinforces the company's capability to cater to institutional infrastructure requirements and further strengthens its position in the domestic market.

Naveen Laroiya: Operational revenue per ton increased to INR 68.82, while operational EBITDA per ton without other income improved to INR 4,954 per metric ton, supported by an improved product mix and continued focus on operational efficiencies. During the quarter, the company continued to strengthen its presence across key end-user industries through its value-added product portfolio. DFT structural steel pipes continued to gain acceptance across the dealer network and industrial applications, supported by improved production and capacity utilization at the Mangaon facility. The quarter also marked progress in strengthening the company's presence in the water infrastructure segment with the receipt of INR 27 crores order for the supply of galvanized iron pipes for water supply and distribution projects in Himachal Pradesh. This order reinforces the company's capability to cater to institutional infrastructure requirements and further strengthens its position in the domestic market.

Speaker #3: During the quarter, the company continued to strengthen its presence across key end-user industries through its value-added product portfolio. EFT structural steel pipes continued to gain acceptance across the dealer network and industrial applications, supported by improved production and capacity utilization at the Mangao facility. The quarter also marked progress in strengthening the company's presence in the water infrastructure segment with the receipt of a ₹27 crore order for the supply of galvanized iron pipes for water supply and distribution projects in Himachal Pradesh. This order reinforces the company's capability to cater to institutional infrastructure requirements and further strengthens its position in the domestic market.

Speaker #3: The company continues to focus on improving operational efficiencies, expanding the contribution from value-added products, and strengthening its presence across domestic and export markets. Supported by its integrated manufacturing platform and diversified workflow, JTL Industries remains focused on creating long-term value through disciplined execution and sustained operational performance.

Naveen Kumar Laroiya: The company continues to focus on improving operational efficiencies, expanding the contribution from value-added products, and strengthening its presence across domestic and export markets. Supported by its integrated manufacturing platform and diversified portfolio, JTL Industries remains focused on creating long-term value through disciplined execution and sustained operational performance. With this, I would now request the Moderator to open the floor for questions and answers. Thank you.

Naveen Laroiya: The company continues to focus on improving operational efficiencies, expanding the contribution from value-added products, and strengthening its presence across domestic and export markets. Supported by its integrated manufacturing platform and diversified portfolio, JTL Industries remains focused on creating long-term value through disciplined execution and sustained operational performance. With this, I would now request the Moderator to open the floor for questions and answers. Thank you.

Speaker #3: With this, I would now request the moderator to open the floor for questions and answers. Thank you.

Speaker #1: Thank you very much. We will now begin the question-and-answer session. Anyone who wishes to ask a question may press star and one on their touch-tone phone.

Operator: Thank you very much. We will now begin with the question and answer session. Anyone who wishes to ask a question may press star and one on their touch-tone phone. 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 from the line of Lokesh Kashikar from SMIFS Institutional Equities. 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 Lokesh Kashikar of Smiths Institutional Equities.

Speaker #1: Please go ahead.

Speaker #3: Yeah, hi. Congratulations, sir, on a very good set of numbers during the quarter. A couple of things—a couple of questions from my side.

Lokesh Kashikar: Hi. Congratulations, sir, on the very good set of numbers during the quarter. A couple of questions from my side, starting with EBITDA per ton. This quarter, the EBITDA per ton was nearer to INR 5,000, and it was elevated and better than guidance. Just wanted to confirm, is there any one-off inventory carrying gains, or it is just a function of value-added mix? That is the first question from my side.

Speaker #3: Starting with EBITDA per turn, this quarter the EBITDA per turn was closer to around $5,000, and it was elevated and better than guidance. So I just wanted to confirm—is there any one-off, like inventory carrying gains, or is it just a function of elevated mix?

Speaker #3: That's the first question from my side.

Speaker #2: Hi, Lokesh. Thanks for the question. So, if you talk about the consolidated EBITDA per ton, this includes the consolidation of JTL Defence as well.

Naveen Kumar Laroiya: Hi, Lokesh. Thanks for the question. EBITDA per ton. This includes the consolidation of JTL Defence as well. JTL Defence contributed close to INR 200 addition in the EBITDA per ton, barring that, the EBITDA per ton was at around INR 4,050 level, which was again a growth as well. As we mentioned that this year's target for us is to maintain the EBITDA around INR 4,500. We are well on track to get the guidance in which, the only contribution added was JTL Defence.

Pranav Singla: Hi, Lokesh. Thanks for the question. EBITDA per ton. This includes the consolidation of JTL Defence as well. JTL Defence contributed close to INR 200 addition in the EBITDA per ton, barring that, the EBITDA per ton was at around INR 4,050 level, which was again a growth as well. As we mentioned that this year's target for us is to maintain the EBITDA around INR 4,500. We are well on track to get the guidance in which, the only contribution added was JTL Defence.

Speaker #2: So, JTL Defense contributed close to ₹200 addition in the EBITDA per ton, bearing in mind that the EBITDA per ton was at around the ₹40 to ₹50 level, which was again a growth as well.

Speaker #2: And as we mentioned, the CS target for us is to maintain the EBITDA around ₹4,500. So we are well on track to get the guidance in reach.

Speaker #2: And the only composition added was for JTL Defense.

Speaker #3: And so what would be the guidance? Would it be closer to, on the consolidated level, around 4,500 to 5,000? Or how would it be?

Lokesh Kashikar: Sir, what would be the guidance? It would be closer to, on the consolidated level, it would be around INR 4,500 to 5,000, or how it would be?

Speaker #2: So, given the normalized situation of HRC right now, we are a bit confident that the 40 to 50 EBITDA per ton in the JTL Steel segment is something that you can achieve in the coming quarters as well.

Naveen Kumar Laroiya: Given the normalized situation of HSE right now, we are very confident that the INR 4,050 EBITDA per ton in JTL Steel segment is something that we can achieve in the coming quarters as well. There is an upward trajectory that we foresee ahead as well. We are very confident that consolidated level INR 5,000 would be something that we will definitely achieve in the coming quarters as well.

Pranav Singla: Given the normalized situation of HSE right now, we are very confident that the INR 4,050 EBITDA per ton in JTL Steel segment is something that we can achieve in the coming quarters as well. There is an upward trajectory that we foresee ahead as well. We are very confident that consolidated level INR 5,000 would be something that we will definitely achieve in the coming quarters as well.

Speaker #2: There is an upward trajectory that we foresee ahead as well. So we are very confident that the control level of ₹5,000 is something that we'll definitely achieve in the coming quarters as well.

Speaker #3: Sure, sure. And so, secondly, what was the EBIT? What was the value-added mix during the quarter? And what was the export component to the overall mix?

Lokesh Kashikar: Sure. Sir, secondly, what was the value added during the quarter, and what was the export component to the overall mix?

Speaker #2: So the value-added composition was again close to 35%, what we've been doing in the past as well. There was slightly dip in the exports this time.

Naveen Kumar Laroiya: The value-added composition was again close to 35%, what we've been doing in the past as well. There was a slight dip in the exports this time. That was majorly because of the container shortages happening all over. Our exports were at 5% this quarter. Going ahead, we have a healthy order book of exports. Actually, one of the biggest order books of exports right now we have in hand. Because of the whole situation, there has been some lag in dispatches. Going ahead, we'll cater everything.

Pranav Singla: The value-added composition was again close to 35%, what we've been doing in the past as well. There was a slight dip in the exports this time. That was majorly because of the container shortages happening all over. Our exports were at 5% this quarter. Going ahead, we have a healthy order book of exports. Actually, one of the biggest order books of exports right now we have in hand. Because of the whole situation, there has been some lag in dispatches. Going ahead, we'll cater everything.

Speaker #2: That was mainly because of the container shortage happening everywhere. So, exports were at 5% this quarter. Going ahead, we have a healthy order book of exports.

Speaker #2: Actually, one of the biggest order books of exports we have right now is in hand. But because of the whole container situation, there has been some lag in dispatches.

Speaker #2: But going ahead, we'll cover everything.

Speaker #3: Sure, sure. And sir, just one last question—just checking on the volume growth guidance. Earlier, you had guided for around 30% volume growth for FY27.

Lokesh Kashikar: Sure. Sir, last one, just checking on the volume growth guidance. Earlier you had guided for around 30% volume growth for FY27, that remains intact?

Speaker #3: So that remains intact?

Speaker #2: Definitely, that remains intact. So if we— I want to ask, so my H2 is usually stronger than H1, given that I do similar kind of volumes, actually higher kind of volumes than what we did in Q1.

Naveen Kumar Laroiya: Definitely, that remains intact. My H2 is usually stronger than H1. Given that I do similar kind of volumes, actually higher kind of volumes than what we did in Q1. If you go at 20% growth over that, we will anyways cross the 30% guidance as well. Still, 30% is something that we'll definitely achieve, our aim will be to deliver more than that as well.

Pranav Singla: Definitely, that remains intact. My H2 is usually stronger than H1. Given that I do similar kind of volumes, actually higher kind of volumes than what we did in Q1. If you go at 20% growth over that, we will anyways cross the 30% guidance as well. Still, 30% is something that we'll definitely achieve, our aim will be to deliver more than that as well.

Speaker #2: And if you do a 20% growth over that, we will anyways cross the 30% guidance as well, but still, 30% is something that we'll definitely achieve.

Speaker #2: But our aim will be to deliver more than that as well.

Lokesh Kashikar: Sure. That's it from my side. Thank you.

Speaker #3: Sure, sure. That's it. Thank you.

Speaker #1: Thank you very much. The next question is from the line of Sawick from Nuvama. Please go ahead.

Operator: Thank you very much. The next question is from the line of Souvik from Nuvama. Please go ahead.

Speaker #4: Hello. Hi. Hi, management. Hi. I just wanted to know a little bit about the manga facility, and are we intact for its completion by H1?

[Analyst] (Nuvama): Hello. Hi, management. I just wanted to know a little bit about the Mangaon facility, are we on track for its completion by H1? How much has been the utilization in Q1 for the same facility?

Souvik Mohanty: Hello. Hi, management. I just wanted to know a little bit about the Mangaon facility, are we on track for its completion by H1? How much has been the utilization in Q1 for the same facility?

Speaker #4: And how much has been the utilization in the first quarter for the same facility?

Naveen Kumar Laroiya: Hi, Souvik. The utilization of the Mangaon facility is about 42% right now. Going ahead, we are very confident to achieve the desired capacity of addition of close to 1 million tons by end of H1. Right now, overall level, like the company level, we are operating at 50,000 utilization level. By year-end, this level should be 65%. As I mentioned that you should see a better H2. This will be because majorly led by the utilization increase at Mangaon facility. Over there, we are doing close to 7,000 to 10,000 tons of DSP right now, which has a

Pranav Singla: Hi, Souvik. The utilization of the Mangaon facility is about 42% right now. Going ahead, we are very confident to achieve the desired capacity of addition of close to 1 million tons by end of H1. Right now, overall level, like the company level, we are operating at 50,000 utilization level. By year-end, this level should be 65%. As I mentioned that you should see a better H2. This will be because majorly led by the utilization increase at Mangaon facility. Over there, we are doing close to 7,000 to 10,000 tons of DSP right now, which has a

Speaker #2: Hi, Sawick. So, the utilization of the Manga facility is about 42% right now. Going ahead, we are very confident we will achieve the desired capacity addition of close to 1 million tons by the end of H1.

Speaker #2: And right now, at the overall company level, we are operating at 50% utilization levels. By year-end, this level should be close to 65%.

Speaker #2: So as I mentioned, you should see a better H2. This will be because it will be majorly led by the utilization increase at the Manga facility.

Speaker #2: Over there, we are doing close to 7,000 to 10,000 tons of DFT right now, which has a huge space to grow—in fact, it could double from here as well.

Dhruv Singla: Huge space to grow. In fact, double from here as well. Once we start to achieve that, our utilization level from the plant itself will touch 60%, and the utilization will increase and so will the margin coming from the Manesar facility.

Pranav Singla: Huge space to grow. In fact, double from here as well. Once we start to achieve that, our utilization level from the plant itself will touch 60%, and the utilization will increase and so will the margin coming from the Manesar facility.

Speaker #2: So, once we do that, once we start to achieve that, our utilization levels from the plant itself will touch 60%. The utilization will increase and so will the margins coming from the Manga facility.

Speaker #4: Thank you. Thank you so much. I just also wanted to touch upon the export bit. I think you mentioned that we have the highest ever export order book currently.

[Analyst] (Nuvama): Thank you. Thank you so much. I just also wanted to touch upon the export bit. I think you mentioned that we have the highest-ever export on the books currently. Could you speak more in terms of what is happening in exports and give us some more flavor in it?

Souvik Mohanty: Thank you. Thank you so much. I just also wanted to touch upon the export bit. I think you mentioned that we have the highest-ever export on the books currently. Could you speak more in terms of what is happening in exports and give us some more flavor in it?

Speaker #4: Could you speak more in terms of what has happened in exports and give us some more insight into that?

Speaker #2: Yeah. Hi, Sawick. Group this side. So, on the export side, due to the issues in hormones and the lack of availability of containers and transportation, the first quarter was a little bit in that aspect.

Dhruv Singla: Yeah. Hi, Pawant. Dhruv this side. On the export side, due to the issues in Hormuz and the lack in availability of containers and transportation thereof, Q1 was hit a little bit in that aspect. Having said that, in the recent times, we've been awarded different affiliations like ACRS, and we've also started some exports to the Americas. We've had good interest from there, and currently we have a good order book for exports to take care of that. If the situation of logistics improves, we shall cover up this lack in Q1 in Q2.

Speaker #2: But having said that, in recent times, we've been awarded different affiliations like ACRS, and we've also started some exports to the Americas.

Speaker #2: So we've had good interest from there, and currently we have a good order book for exports. To take care of that, if the logistics situation improves, we shall cover up this lack in the first quarter in the second one.

Speaker #4: Okay. Okay.

[Analyst] (Nuvama): Okay.

Souvik Mohanty: Okay.

Speaker #3: And to quantify, the earlier mentioned target of 10% of total sales to exports is something that we'll target for the coming quarters as well.

Dhruv Singla: To quantify will be the earlier mentioned target of 10% of total sales to exports is something that we'll target for the coming quarters as well. The some lag in 5% will be accounted for in the coming quarters.

Pranav Singla: To quantify will be the earlier mentioned target of 10% of total sales to exports is something that we'll target for the coming quarters as well. The some lag in 5% will be accounted for in the coming quarters.

Speaker #3: The some lag in 5% will be accounted for in the coming quarters.

Speaker #4: Understood. Could you also give me the CapEx outflow that you've planned for FY27 and FY28?

[Analyst] (Nuvama): Understood. Could you also give me the CapEx outflow that you've planned for FY27 and FY28?

Souvik Mohanty: Understood. Could you also give me the CapEx outflow that you've planned for FY27 and FY28?

Speaker #3: So for this year, the capex outflow is close to ₹100 crores. And this will be completing our entire capex. After that, there will be only maintenance capex of ₹30–40 crores every year at max happening.

Dhruv Singla: For this year, the CapEx outflow is close to INR 100 crores, and this will be completing our entire CapEx leftover. After that, there will be only remaining CapEx of INR 30, 40 crores every year at max happening. The remaining INR 100 crores of CapEx will complete our entire journey to 2 million tons.

Pranav Singla: For this year, the CapEx outflow is close to INR 100 crores, and this will be completing our entire CapEx leftover. After that, there will be only remaining CapEx of INR 30, 40 crores every year at max happening. The remaining INR 100 crores of CapEx will complete our entire journey to 2 million tons.

Speaker #3: But the remaining ₹100 crores of capex will complete our entire journey to 2 million tons.

Speaker #4: Okay. Okay. Thank you. Thank you so much.

[Analyst] (Nuvama): Okay. Thank you so much.

Souvik Mohanty: Okay. Thank you so much.

Speaker #1: Thank you. The next question is from the line of Jatin from Nuvama. Before that, ladies and gentlemen, this is a reminder for all participants: please press star and one to ask a question.

Operator: Thank you. The next question is from the line of Jatin from Nuvama. Before that, ladies and gentlemen, it's a reminder for all participants, please press star and one to ask a question. Participants who wish to ask a question, please press star and one. Jatin from Nuvama, please go ahead.

Speaker #1: Participants who wish to ask a question, please press star and one. Jatin from Nuvama, please go ahead.

Speaker #3: Hi, Dean. Good morning. I've got two questions. First is on JTL Defense. Regarding the guidance, are we maintaining our guidance at ₹200 crore of top line and 6,000 tons?

[Analyst] (Nuvama): Hi. Good morning. I've got two questions. First one, JTL. Coming to guidance, are we maintaining our guidance at 200 crores of top line and 6,000 tons? I believe EBITDA margin guidance was at about 10% to 15%. What's with that?

Jatin Manuja: Hi. Good morning. I've got two questions. First one, JTL. Coming to guidance, are we maintaining our guidance at 200 crores of top line and 6,000 tons? I believe EBITDA margin guidance was at about 10% to 15%. What's with that?

Speaker #3: And I believe EBITDA margin guidance was at about 10 to 15%. What's with that? Sorry, could you please repeat the number you just said?

Dhruv Singla: Sorry, can you please read the number that you said please again once? Hello?

Speaker #3: Hello?

Speaker #1: Ladies and gentlemen, we have lost the line with the last participant. Please press star one to ask a question. The next question is from the line of Nishita Shanklesh from Sapphire Capital.

Operator: Ladies and gentlemen, we have lost the line of the last participant. It's a reminder for all participants, please press star and one to ask a question. The next question is from the line of Nishita Shanklesh from Sufaya Capital. Please go ahead.

Speaker #1: Please go ahead.

Speaker #5: Hello. Am I audible?

Nishita Shanklesh: Hello, am I audible?

Speaker #3: Yes.

Dhruv Singla: Yes.

Speaker #5: Yeah. So currently, our capacity is 1 million tons. And you mentioned that after our total capex of ₹100 crores is done, we'll reach a capacity of 2 million tons.

Nishita Shanklesh: Yeah. Currently our capacity is 1 million ton and you mentioned that after our total CapEx of INR 100 crore is done, we will reach the capacity of 2 million tons. How fast can we ramp up this capacity and is it going to come in phases?

Speaker #5: So, how much can we ramp up this capacity? And is it going to come in phases?

Speaker #3: Yes. So the capacity is going to come in phases, the ramp. So if you talk about the full 1 million tons, out of this, 700,000 tons—or close to 700,000 tons—shall be commissioned by the end of H1.

Dhruv Singla: Yes. The capacity is going to come in phases. If you talk about the full million tons out of this 7 lakh tons or close to 7 lakh tons shall be commissioned by H1 end and the remaining 3 lakh tons will be commissioned by next year around this time and that will be of API pipes that we have already announced before. If you talk about the ramp up, the ramp up will take some time although you will see some contribution of the new capacity happening every quarter but the full utilization levels will be met by FY29 and on that whole capacity we should achieve a plus of 50% to 55% utilization levels in FY29.

Pranav Singla: Yes. The capacity is going to come in phases. If you talk about the full million tons out of this 7 lakh tons or close to 7 lakh tons shall be commissioned by H1 end and the remaining 3 lakh tons will be commissioned by next year around this time and that will be of API pipes that we have already announced before. If you talk about the ramp up, the ramp up will take some time although you will see some contribution of the new capacity happening every quarter but the full utilization levels will be met by FY29 and on that whole capacity we should achieve a plus of 50% to 55% utilization levels in FY29.

Speaker #3: And the remaining 3 lakh tons will be commissioned by next year, around this time. And that will be of API pipes; that was already announced before.

Speaker #3: And if you talk about the ramp-up, the ramp-up will take some time, although you will see some contribution from the new capacity happening every quarter.

Speaker #3: But the full utilization levels will be met by FY29. And on that whole capacity, we should achieve a cluster of 50 to 55 percent utilization levels in FY29.

Speaker #3: So if you talk about.

Speaker #5: Okay. In FY29, we can reach a 50 to 60 percent utilization level.

Nishita Shanklesh: Okay. In FY29 we can reach 60% utilization level.

Speaker #3: Fifty to sixty percent utilization levels—it's too early for us to comment right now because it depends on which quarter the full capex is completed for the remaining last 300,000 tons.

Dhruv Singla: 50% to 60% utilization level. It is too early for us to comment right now because it depends in which quarter the full CapEx is completed for the remaining last 3 lakh tons of API pipes. That will be a key thing to note and tell that when exactly can we achieve the utilization accordingly.

Pranav Singla: 50% to 60% utilization level. It is too early for us to comment right now because it depends in which quarter the full CapEx is completed for the remaining last 3 lakh tons of API pipes. That will be a key thing to note and tell that when exactly can we achieve the utilization accordingly.

Speaker #3: ...of API pipes. So, that will be a key thing to note and to discuss—when exactly can we achieve the utilization accordingly.

Speaker #5: So the total capacity, we can assume, will be commissioned in FY28, and by FY29, we can reach a utilization level of 50 to 60 percent.

Nishita Shanklesh: The total capacity like we can assume will be commissioned in FY28 and by FY29 we can reach the utilization level of 50% to 60%.

Speaker #3: Fifty to sixty percent. Yes, fifty to sixty percent in FY29.

Dhruv Singla: 50% to 60%. Yeah, 50% to 60% in FY29.

Speaker #5: Right. Right. Okay. Understood. And what will be the revenue at peak utilization? I'm assuming the peak utilization to be 75–80 percent. What is the total revenue that you can expect?

Nishita Shanklesh: Right. Okay.

Dhruv Singla: Yes.

Nishita Shanklesh: What will be our peak utilization? I'm assuming the peak utilization to be of 75% to 80%. What is the total revenue that we can expect?

Speaker #3: The peak utilization that we can achieve is close to 70 percent. So that is something that we'll target in FY29 itself as well, as I mentioned.

Dhruv Singla: The peak utilization that we can achieve is close to 70%. That is something that we'll target in FY29 itself as well as I mentioned. It is very subjective how fast the CapEx is completed of the last leg. 70% is something that we'll reach at peak. That can happen as soon as FY29, and that can happen as late as FY30.

Pranav Singla: The peak utilization that we can achieve is close to 70%. That is something that we'll target in FY29 itself as well as I mentioned. It is very subjective how fast the CapEx is completed of the last leg. 70% is something that we'll reach at peak. That can happen as soon as FY29, and that can happen as late as FY30.

Speaker #3: But it is very subjective how far the capex is completed on the last leg. So, 70 percent is something that we'll reach at peak.

Speaker #3: So, that can happen as soon as FY29 as well, and that can happen as late as FY30.

Speaker #5: Okay. And the revenue potential at peak utilization will be?

Nishita Shanklesh: Okay. The revenue potential at peak utilization will be?

Speaker #3: Sorry?

Dhruv Singla: Sorry.

Pranav Singla: Sorry.

Speaker #5: The revenue potential at peak utilization?

Nishita Shanklesh: The revenue potential at peak utilization.

Speaker #3: So right now, the realization per ton is close to 6,000 rupees. As we are pouring into value to products, going ahead, we can expect the realization to increase from 6,000 rupees to 65, 66,000 rupees going ahead.

Dhruv Singla: Right now, the realization per ton is close to INR 6,000. As we are.

Pranav Singla: Right now, the realization per ton is close to INR 6,000. As we are.

Nishita Shanklesh: Right

Dhruv Singla: pouring into value products going ahead, we can expect the realization to increase from INR 6,000 to INR 65,000, INR 66,000 going ahead. On the peak levels of 70%, if you do so about 1.4 million times into INR 65,000 is something that could be the peak revenue.

Pranav Singla: pouring into value products going ahead, we can expect the realization to increase from INR 6,000 to INR 65,000, INR 66,000 going ahead. On the peak levels of 70%, if you do so about 1.4 million times into INR 65,000 is something that could be the peak revenue.

Speaker #3: So, around the peak levels of 70 percent, if you do, so about 1.4 million tons into ₹65,000 is something that could be the peak revenue.

Nishita Shanklesh: Okay.

Speaker #3: On the current capex cycle.

Dhruv Singla: On the current CapEx cycle.

Pranav Singla: On the current CapEx cycle.

Speaker #5: Okay, understood. Thank you so much.

Nishita Shanklesh: Okay, understood. Thank you so much.

Speaker #3: Okay.

Dhruv Singla: Welcome.

Pranav Singla: Welcome.

Speaker #1: Thank you. Ladies and gentlemen, a reminder for all participants: please press star, then one, to ask a question. Participants wishing to ask a question, please press star, then one.

Operator: Thank you. Ladies and gentlemen, reminder for all participants, please press star and one to ask a question. Participants, to ask a question, please press star and one. The next question is from the line of Jatin from Nuvama. Please go ahead.

Speaker #1: The next question is from the line of Jatin from Nuvama. Please go ahead.

Speaker #3: Hi, apologies for earlier. Continuing from the previous question—my question was regarding JTL's defense segment. So, the guidance, I believe, was a top line of ₹200 crore and a volume of 6,000 tons, right?

[Analyst] (Nuvama): Hi. Apologies for earlier. Continuing on the question earlier. My question was on JTL Defence. The guidance I believe we had was top line of INR 200 crore and a volume of 6,000 tons. Right? EBITDA margin at 10% to 15%. Are we maintaining that?

Jatin Manuja: Hi. Apologies for earlier. Continuing on the question earlier. My question was on JTL Defence. The guidance I believe we had was top line of INR 200 crore and a volume of 6,000 tons. Right? EBITDA margin at 10% to 15%. Are we maintaining that?

Speaker #3: And EBITDA margin at 10 to 15 percent—are we maintaining that? Hi, Jatin. So, this guidance is not for the volume; the guidance is not for this year.

Dhruv Singla: Hi, Jatin. This volume guidance is not for this year. Although the top line is something that we're still trying to achieve, and we'll be touching close to INR 150 crore top line on that. Right now, given the run rate of Q1, we were at about 100 metric tons a month, and we've already reached a run rate of 120 metric tons a month in this quarter. In this first month, we did close to 120 metric tons of sales in Q first month of this quarter. We are expecting by exit quarter, we'll be touching 500 tons, close to 100 tons of sales in Defence by that time. The guidance on the margin over there, Q4 was a exceptional quarter in that because of led by inventory gains, in which we did 20% EBITDA margin. In Q1, we had about 12% EBITDA margin in Defence.

Speaker #3: Although the top line is something that we still intend to achieve, we'll be touching close to ₹150 crore of top line on that.

Speaker #3: Right now, given the 100 of Q1, we were at about 100 metric tons a month. And we've already reached 100 or 120 metric tons a month in this quarter. In this first month, we did close to 120 metric tons of sales in Q1, first month of this quarter.

Speaker #3: So, we are expecting, by the exit quarter, we'll be touching close to 500 tons of sales in defense by that time. And the guidance on the margin over there—so, Q4 was an exceptional quarter in that, because it was led by inventory gains.

Speaker #3: In which we did 20% EBITDA margins. In Q1, we had about 12% EBITDA margin. In defense, going ahead, it's too soon again to maintain the exact 15% margin going ahead.

Dhruv Singla: Going ahead, it's too soon again to maintain the exact 15% margin going ahead. The long term margin is 15%, for now it can be weaving around because it's a new setup for us, a new industry for us. A lot of things are being tested over there and a lot of things are being planned differently as well. 10% to 15% is something that we will achieve in the long term proposition.

Speaker #3: But the long-term margin is 15 percent. For now, though, it may waver a bit because this is a new setup for us—a new industry for us.

Speaker #3: So a lot of things are being tested over there, and a lot of things are being planned differently as well. But 10 to 15 percent is something that you will achieve in the long-term proposition.

Speaker #4: Understood. Understood. The second question is coming to growth. I mean, will you be able to quantify? I mean, how much of the growth volume would have come up from the new capacities that are ramping up?

[Analyst] (Nuvama): Understood. The second question is, coming to growth, will you be able to quantify how much of the growth volume will just come up from the new capacities that are ramping up, and how much does it come from the market share gains that you've been getting from filling the channel inventory? If you can just give a breakup.

Souvik Mohanty: Understood. The second question is, coming to growth, will you be able to quantify how much of the growth volume will just come up from the new capacities that are ramping up, and how much does it come from the market share gains that you've been getting from filling the channel inventory? If you can just give a breakup.

Speaker #4: And how much of it comes from the market share gains that you've been getting from filling the channel inventory? If you could just give a quick update.

Speaker #3: As I mentioned earlier, we were doing close to 10,000 tons of GST a quarter. From that, we have almost doubled ourselves, and we are now close to 20,000 to 25,000 tons of GST a quarter.

Dhruv Singla: As I mentioned that earlier, we were doing close to 10,000 tons of DFT a quarter. From that, we have almost doubled our sales, and we are close to 20,000 to 25,000 tons of DFT a quarter right now. There is new capacity which is playing the role as well, and also we are gaining share in the segment as well because we are getting paneled in a lot of places in Maharashtra itself and in export market as well. There is a good demand for DFT sections. We have opened our borders to USA, Mexico, and Canada as well. All these places, DFT is being exported as well. There's a bit of market share gaining happening, and there's a mix of new reopening as well.

Speaker #3: So, there is new capacity which is playing a role as well. Also, we are gaining share in the segment as we are getting paneled in a lot of places in Maharashtra itself.

Speaker #3: And in the export market as well, there is a good demand for DUT sections. We have opened our borders to the USA as well, and Mexico as well.

Speaker #3: And Canada as well. So, in all these places, DFT is being exported as well. So there's a bit of market share gain happening, and there's a mix of new areas opening as well.

Speaker #4: Okay, great. Thank you. That's all from my end.

[Analyst] (Nuvama): Okay, cool. Thank you. That's all from my end.

Souvik Mohanty: Okay, cool. Thank you. That's all from my end.

Speaker #1: Thank you. A reminder for all participants: please press star and one (*1) to ask a question. Participants who wish to ask a question may press star and one.

Operator: Thank you. Reminder for all participants, please press star and one to ask a question. Participants who wish to ask a question may press star and one. The next question is from the line of Dewang from Abakkus Asset Manager Private Limited. Please go ahead.

Speaker #1: The next question is from the line of Devang from Abacus Asset Manager Private Limited. Please go ahead.

[Analyst] (Abakkus Asset Manager): Hello, sir. Good afternoon. Congratulations on a good set of numbers. My question is on the demand side. How is the demand panning out from various sectors at the moment? How do you see it going forward?

Dewang Sanghavi: Hello, sir. Good afternoon. Congratulations on a good set of numbers. My question is on the demand side. How is the demand panning out from various sectors at the moment? How do you see it going forward?

Speaker #4: Hello, sir. Good afternoon. Congratulations on a good set of numbers. My question is on the demand side: How is the demand panning out for various sectors at the moment?

Speaker #4: How do you see it going forward?

Dhruv Singla: Very good. You said demand panning out from I could not hear the last part, sorry.

Speaker #3: Hi. You said, "demand panning out from"—I could not hear the last part. Sorry.

Speaker #4: Yeah. How is the demand panning out in terms of various sectors? You said you're using industries, so I'm not asking.

[Analyst] (Abakkus Asset Manager): See, how is the demand panning out in terms of various sectors? You are using industries, I was asking you this question.

Dewang Sanghavi: See, how is the demand panning out in terms of various sectors? You are using industries, I was asking you this question.

Speaker #3: Yeah. So see, there is a good demand. Firstly, there is a difference between the primary and the secondary products. So there is a good demand in the secondary product at the moment.

Dhruv Singla: Yeah. See, there is a good demand. Firstly, there is a difference between the primary and the secondary product. There is a good demand in the secondary product at the moment. It's a record-breaking demand in secondary product. That is one aspect of it because the difference is there. The primary product wherein we have gained a market share in DFT, we have gained a market share in specialized products from low wire, high thickness, replacement of seamless pipes, making some thicknesses as replacement of seamless pipes. These areas we are actively gaining ground on with direct supply to OEMs also and also then the dealer network also. These products are something not everybody is doing and only a few handful of us are doing in India. Earlier it was imported a lot.

Speaker #3: It’s record-breaking demand in the secondary product, so that is one aspect of it because the difference is there. And in the primary product, where we have gained market share in DFT, we have gained market share in specialized products from low diameter, high thickness.

Speaker #3: Replacement of seamless pipes, making some thicknesses as replacement of seamless pipes. So in these areas, we are actively gaining ground with direct supply to OEMs also, and then the dealer network.

Speaker #3: So these products are something not everybody is doing, and only a handful of us are doing in India. Earlier, they were imported a lot.

Speaker #3: So, these are the markets that we are gaining active share in, and we have gotten a lot of good response in this area. With time, we've also refined how we are able to deploy these products into areas such as the replacement of, say, seamless pipes in hydraulic segments.

Dhruv Singla: These are the markets that we are gaining active share in. We've gotten a lot of good response in this area. With time, we've also researched how we are able to deploy these products into areas such as replacement of say, seamless pipes in hydraulic segments and in automotive segments, wherein the price sensitivity has come, and also they need higher grade materials which perform better. We've been able to penetrate in that right now.

Speaker #3: And in automotive segments, where price sensitivity has come in, but they also need higher-grade materials that perform better, we've been able to penetrate that right now.

Speaker #4: Right. So basically, you're entering into import substitution in new areas, basically. Is that understanding correct?

[Analyst] (Abakkus Asset Manager): Right. Basically you are entering into import substitution in new areas, basically. Is that understanding correct?

Dewang Sanghavi: Right. Basically you are entering into import substitution in new areas, basically. Is that understanding correct?

Speaker #3: Yes, yes, yes. And these are all value-added products. So, we are value-added products. Yeah, galvanized pipe. But these areas are now value-added products in the platform.

Dhruv Singla: Yes. These are all value-added products.

[Analyst] (Abakkus Asset Manager): Value added.

Dewang Sanghavi: Value added.

Dhruv Singla: Yeah, galvanized type, these areas are now value-added products.

[Analyst] (Abakkus Asset Manager): Black top.

Dhruv Singla: Black top.

Speaker #4: So, value addition proportion is 35 percent currently. How can it pan out in the next couple of years? What percentage is it going to go to?

Dhruv Singla: With the black top.

[Analyst] (Abakkus Asset Manager): Value addition proportion, which is 35% currently, how can it pan out next couple of years? Or what percent it can go to? Because we have capacities coming in the market which are value addition.

Dewang Sanghavi: Value addition proportion, which is 35% currently, how can it pan out next couple of years? Or what percent it can go to? Because we have capacities coming in the market which are value addition.

Speaker #4: Because we have capacity coming in the Mangal, which is value addition.

Dhruv Singla: No, sorry. Come again?

Speaker #3: No. Sorry. Come again.

Speaker #4: I was going to ask, is it 35 percent value addition? Thirty-five percent of the product mix is value added. So, what can it go to in the medium term?

[Analyst] (Abakkus Asset Manager): I was asking if 35% value addition, what we are 35% the product mix is value added. What it can go in the medium term, say couple of years down the line?

Dewang Sanghavi: I was asking if 35% value addition, what we are 35% the product mix is value added. What it can go in the medium term, say couple of years down the line?

Speaker #4: Say, a couple of years down the line.

Speaker #3: So our target is, when we are getting our CRM processes also running, the 1 million to 2 million tonnes—that is on value-added product.

Dhruv Singla: Our target is when we are getting all the CRM processes also running the 1 million tons to 2 million tons, that is all value added product. Our target in the coming future is minimum 50% to 60% of our product will be value added.

Speaker #3: So our target in the coming future is that a minimum of 50 to 60 percent of our product will be value-added.

Speaker #4: Right, right. And how has July panned out in terms of volumes? Any color on that?

[Analyst] (Abakkus Asset Manager): Right. How is July pan out in terms of volumes? Any color on that?

Dewang Sanghavi: Right. How is July pan out in terms of volumes? Any color on that?

Speaker #3: So July, for us, was again an all-time high month. And, going ahead, with the run rate as well, we'll be able to achieve an all-time high quarter as well, given the situation.

Dhruv Singla: July for us was again an all-time high month. Going ahead with the run rate as well, we'll be able to achieve our all-time high quarter as well given the situation. Things are shaping as well as Dhruv mentioned that there is a good gap in primary and secondary right now as well.

Pranav Singla: July for us was again an all-time high month. Going ahead with the run rate as well, we'll be able to achieve our all-time high quarter as well given the situation. Things are shaping as well as Dhruv mentioned that there is a good gap in primary and secondary right now as well.

Speaker #3: So, things are shaping up as well. As Dhruv mentioned, there is a good gap in primary and secondary right now as well. So, because of the whole situation, the secondary demand is also excellent as well.

[Analyst] (Abakkus Asset Manager): Right

Dewang Sanghavi: Right

Dhruv Singla: the whole situation, the secondary demand is also excellent as well. Because of this situation, we'll be probably able to deliver another all-time high quarter.

Pranav Singla: the whole situation, the secondary demand is also excellent as well. Because of this situation, we'll be probably able to deliver another all-time high quarter.

Speaker #3: And because of this situation, we are able to build—you’re probably able to deliver another all-time high quarter.

[Analyst] (Abakkus Asset Manager): Good figure. Lastly, I missed the CapEx number. Can you please read again for FY27 and FY28?

Dewang Sanghavi: Good figure. Lastly, I missed the CapEx number. Can you please read again for FY27 and FY28?

Speaker #4: Good figure. And then lastly, I missed the capex number. Can you please read it again for Q1 and Q2?

Speaker #3: For FY27, the capex figures would be close to ₹1 crore, and that will complete our capex. In the next financial year, the capex will be maintenance capex of ₹30 to ₹40 crore at max.

Dhruv Singla: For FY27, the CapEx figures will be close to INR 1 crore, and that will complete our CapEx. In the next financial year, the CapEx will be a maintenance CapEx of INR 30 to 40 crore at max.

[Analyst] (Abakkus Asset Manager): Wonderful.

Dewang Sanghavi: Wonderful.

Speaker #3: This is only the capex of industries. There can be some capex happening in defense as well, so that is extra over that. But that capex is anyway not any sizable capex.

Dhruv Singla: This is only the CapEx of industries. There can be some CapEx happening in JTL Defence as well, so that is extra over that. That CapEx is anyway not any sizable CapEx. It will be close to INR 15, 20 crore going ahead as well.

Speaker #3: It will be close to 15 to 20 crores going ahead as well.

[Analyst] (Abakkus Asset Manager): Got it. Thank you for the answers and all the best.

Dewang Sanghavi: Got it. Thank you for the answers and all the best.

Speaker #4: All right. All right. Thank you for answering, and all the best.

Speaker #3: Thank you, Devang.

Dhruv Singla: Thank you, Divank.

Dhruv Singla: Thank you, Dewang.

Speaker #1: Thank you. A reminder for all participants: please press star one (*1) to ask a question. Participants who wish to ask a question, please press star one at this time.

Operator: Thank you. Reminder for all participants, please press star and one to ask a question. Participants who wish to ask a question, please press star and one. The next question is from the line of Sneha Talreja from Nuvama Wealth Management. Please go ahead.

Speaker #1: The next question is from the line of Sneha Talreja from Newama Wealth Management. Please go ahead.

Speaker #5: Hi, Dean. Thanks a lot for the opportunity. Just a couple of questions from my side. While you answer them, demand—could you tell us, how is government capex at this point of time?

Sneha Talreja: Hi, Dean. Thanks a lot for the opportunity. Just couple of questions from my end. While you answer on demand, could you tell us how is government CapEx at this point of time? Are we getting any orders from NLCHL? We've earlier been one of the beneficiaries or are we seeing any CapEx outlay from that particular scheme happening? That's the first one.

Speaker #5: Are we getting any orders from Nalseja? We've earlier been one of the beneficiaries. Or are we seeing any KPEX outlay from that particular scheme happening?

Speaker #5: That's the first one.

Speaker #3: Hi, Sneha. So, there has been a little increase in the government capex. It's not the situation that we saw two years back, but now there has been improvement.

Dhruv Singla: Hi, Sneha. There has been a little increase in the government CapEx, not the situation what we saw two years back, but now there has been improvement, and we've got some orders as well. We as a company have made a point of having more sales to our dealer network and exports. That's our target audience right now. The government is very seasonal demand, so we are not relying on government sector anymore. Earlier, our Dera Bassi plant, which is a Punjab plant, we had dedicated that plant towards government earlier, but now we have shifted that mode and from there we are keeping the dealer market as well. It's just that when there are good government orders of particular size coming in favorable to us, that time we open up to these orders.

Pranav Singla: Hi, Sneha. There has been a little increase in the government CapEx, not the situation what we saw two years back, but now there has been improvement, and we've got some orders as well. We as a company have made a point of having more sales to our dealer network and exports. That's our target audience right now. The government is very seasonal demand, so we are not relying on government sector anymore. Earlier, our Dera Bassi plant, which is a Punjab plant, we had dedicated that plant towards government earlier, but now we have shifted that mode and from there we are keeping the dealer market as well. It's just that when there are good government orders of particular size coming in favorable to us, that time we open up to these orders.

Speaker #3: And we've got some orders as well. But we, as a company, have made a point of having more sales to our dealer network. And exports, that's what our target audience is right now.

Speaker #3: The government sector has very seasonal demand, so we are not relying on the government sector anymore. Earlier, our Dera Bassi plant, which is a Punjab plant, was dedicated towards the government.

Speaker #3: But now we have shifted that mode. And from there, we are keeping the dealer market as well. It's just that, when there are good government orders of a particular size coming in that are favorable to us, that's when we open up to these orders.

Speaker #3: So that's why, if you saw as well, last year government contribution was not even 5 percent, whereas it was over 25 percent earlier. So we've been trying to intentionally cut off our government base as well and focus more towards dealer and export markets.

Dhruv Singla: That's why if you saw as well, like our last year government contribution was not even 5%, which was over 25% earlier. We've been trying to intentionally cut off our government base as well and focus more towards dealer and export market.

Pranav Singla: That's why if you saw as well, like our last year government contribution was not even 5%, which was over 25% earlier. We've been trying to intentionally cut off our government base as well and focus more towards dealer and export market.

Speaker #5: Understood. Any dealer distribution network increase that you want to give us?

Sneha Talreja: Understood. Any dealer distribution network increase that you want to give us?

Speaker #3: The current dealer network is sufficing with the products. The DFT product, which has been a volume pusher, is actually going to departments like MMRDA and airport authorities. So these are the places where the product is going.

Dhruv Singla: The current dealer network is sufficing the products. The DFT product which has been a volume pusher is actually going to the departments like MMRDA and airport authorities. These are the places where the product is going and not to dealers. Earlier, in Q1 when we started DFT, the product was being moved to all these places through dealers. Now as we've impaneled most of the places ourselves, so it is a direct sales that is happening over there.

Pranav Singla: The current dealer network is sufficing the products. The DFT product which has been a volume pusher is actually going to the departments like MMRDA and airport authorities. These are the places where the product is going and not to dealers. Earlier, in Q1 when we started DFT, the product was being moved to all these places through dealers. Now as we've impaneled most of the places ourselves, so it is a direct sales that is happening over there.

Speaker #3: And not to dealers. Earlier, in the first quarters, when we started DFT, the product was being moved to all these places through dealers. But now, as we're panning most of the places ourselves, it is direct sales that are happening over there.

Speaker #5: Understood. And lastly, what I wanted to understand was, how was the primary and the secondary spread during Q1? And what is it now?

Sneha Talreja: Understood. Lastly, what I wanted to understand was how was the primary and the secondary spread during Q1 and what is it now and how is it benefiting us at this point?

Speaker #5: And how is it benefiting us at this point?

Dhruv Singla: The difference between the primary and the secondary has remained in the range bound of about INR 8 to 12 in the last quarter with INR 7 to 8 being the lowest end of it and INR 11 to 12 being the latter end of it.

Speaker #3: The difference between the primary and the secondary has remained in the range bound of about 8 to 12 rupees in the last quarter. With 7 to 8 rupees being the lowest end of it.

Speaker #3: And 11, 12 rupees being the latter end of it. So when this kind of difference, which was normally earlier around 4 to 5 rupees per kg, when this kind of difference rises, then the demand in the secondary product increases.

Pranav Singla: When this kind of difference, which was normally earlier around INR 4 to 5 per kg, when this kind of difference arises, the demand in the secondary product increases. Currently our capacity being about 45% to 50% in the secondary market, we were able to capitalize on this demand in Q1. Right now also, the difference is similarly, there is bumper demand in the secondary market. Yes, till the time this difference remains, we shall see the demand pattern being similar.

Dhruv Singla: When this kind of difference, which was normally earlier around INR 4 to 5 per kg, when this kind of difference arises, the demand in the secondary product increases. Currently our capacity being about 45% to 50% in the secondary market, we were able to capitalize on this demand in Q1. Right now also, the difference is similarly, there is bumper demand in the secondary market. Yes, till the time this difference remains, we shall see the demand pattern being similar.

Speaker #3: And currently, our capacity being about 45 to 50 percent in the secondary market, we were able to capitalize on this demand in these quarters.

Speaker #3: In this quarter, so right now also, the difference is similar. And there is bumper demand in the secondary market. So yes, till the time this difference remains, we shall see the demand pattern being in a similar manner.

Speaker #5: Got that. Thanks. Thanks a lot, Dean. All the best.

Sneha Talreja: Got that. Thanks a lot, team. All the best.

Speaker #1: Thank you. The next question is from the line of Sandhya from Wealth Advisory. Please go ahead.

Operator: Thank you. The next question is from the line of Sandhya from Wealth Advisory. Please go ahead.

[Analyst] (Wealth Advisory): Hello. Am I audible, sir?

Speaker #4: Hello. So Anna, audible sir?

Speaker #3: Yes, Sandhya, you're audible.

Dhruv Singla: Yes, Sandhya, audible.

Naveen Laroiya: Yes, Sandhya, audible.

Speaker #4: Okay. So first of all, sir, congratulations on the strong quarter. I had a couple of questions to ask. Could you please provide an update on exports?

[Analyst] (Wealth Advisory): Okay. First of all, sir, congratulations on the strong quarter. I had a couple of questions to ask. Can you just provide an update on exports and which geographies are seeing this strong traction, particularly after getting ACRS certification?

Speaker #4: And which geographies are seeing the strongest traction, particularly after just receiving ACRS certification?

Speaker #3: So, east. You were saying, so ACRS certification is mainly for Australia, and the traction from the certificate mainly helps us gain market share in Australia itself.

Dhruv Singla: ACRS certification is majorly for Australia, the traction from the certificate has majorly helped us gain market share in Australia itself. More than that, we have been opening our borders to US and Mexico as well. That has been a market where we've been supplying heavily as well in the past quarter.

Pranav Singla: ACRS certification is majorly for Australia, the traction from the certificate has majorly helped us gain market share in Australia itself. More than that, we have been opening our borders to US and Mexico as well. That has been a market where we've been supplying heavily as well in the past quarter.

Speaker #3: And more than that, we have been opening our—what is it—the US, Mexico, US and Mexico as well. So that has been a market where we've been supplying heavily as well in the last quarter.

Speaker #4: Okay. And yes, sir, our second question is related to the order book. So can you just highlight how much order book we have, and what is the timeline for execution of it?

[Analyst] (Wealth Advisory): Okay. Sir, second question was on order book related. Can you just highlight how much order book you have and what is the timeline of execution of that?

Speaker #3: So if you talk about the export order book, we have plus for the ₹75 crore of order book of exports right now. And if you talk about the normal order book for the company, a quarter order book is something that usually moves around.

Dhruv Singla: If you talk about the export order book, we have plus for the INR 75 crores of order book of exports right now. If you talk about the normal order book for the company, a quarter order book is something that usually moves around and we work with. That's the kind of order book we still have right now. That's about the order book position for now.

Pranav Singla: If you talk about the export order book, we have plus for the INR 75 crores of order book of exports right now. If you talk about the normal order book for the company, a quarter order book is something that usually moves around and we work with. That's the kind of order book we still have right now. That's about the order book position for now.

Speaker #3: And we work with—so that's the kind of order book we still have right now. So that's about the order book situation for now.

Speaker #4: Can you just quantify it?

[Analyst] (Wealth Advisory): Can you just quantify it?

Speaker #3: So, a lag in terms of the order book is something that's always in a moving market.

Dhruv Singla: A lakh tons of order book is something that's always in. It's a moving market.

Pranav Singla: A lakh tons of order book is something that's always in. It's a moving market.

Speaker #2: Yeah. Ma'am, it's a dealer network market. So when we say that we are the dealer network contributes for 50 to 60 percent of our entire sales, the order book per dealer is not on a it's on a daily basis rather than on a fixed day basis.

Pranav Singla: Ma'am, it's a dealer network market. When we say that the dealer network contributes for 50% to 60% of our entire sales, the order book per dealer is on a daily basis rather than on a fixed-day basis. We tend to sell to our dealers on a daily basis. That's how it is. If you quantify the export orders and all, that we can quantify because that is a longer delivery period order. In the local market, we have to deliver between seven to 10 days, that is how our order book keeps on changing on a daily basis.

Dhruv Singla: Ma'am, it's a dealer network market. When we say that the dealer network contributes for 50% to 60% of our entire sales, the order book per dealer is on a daily basis rather than on a fixed-day basis. We tend to sell to our dealers on a daily basis. That's how it is. If you quantify the export orders and all, that we can quantify because that is a longer delivery period order. In the local market, we have to deliver between seven to 10 days, that is how our order book keeps on changing on a daily basis.

Speaker #2: So, we tend to sell to our dealers on a daily basis—that's how it is. But if you quantify the export orders and all, that we can quantify, because that is a longer delivery period order.

Speaker #2: In the local market, we have to deliver every 10 days. And that is how the order book keeps on changing on a daily basis.

Speaker #4: Okay. And how should the investor think about the working capital and cash conversion as sales volumes continue to increase?

[Analyst] (Wealth Advisory): Okay. How should the investors think about the working capital and cash conversion as sales volumes continue to increase?

Dhruv Singla: The working capital cycle has been improving of the company. We were about 90 days earlier, which has come down this quarter. It's about 75 days right now at this quarter. Going ahead, we are opting for dealer financing as well, which will further bring down our working capital. You should see improvement in the working capital cycle happening in the coming quarters. As I mentioned again, our working capital cycle was majorly stretched because of a government-based earlier underpayments being due over there for a long while. Now we've changed our mode and focused more towards exports and dealer network, wherein dealer network, the payments are only about seven to eight days. The working capital cycle will improve drastically to 35, 40 days levels in the coming years.

Pranav Singla: The working capital cycle has been improving of the company. We were about 90 days earlier, which has come down this quarter. It's about 75 days right now at this quarter. Going ahead, we are opting for dealer financing as well, which will further bring down our working capital. You should see improvement in the working capital cycle happening in the coming quarters. As I mentioned again, our working capital cycle was majorly stretched because of a government-based earlier underpayments being due over there for a long while. Now we've changed our mode and focused more towards exports and dealer network, wherein dealer network, the payments are only about seven to eight days. The working capital cycle will improve drastically to 35, 40 days levels in the coming years.

Speaker #3: The working capital cycles have been improving for the company. We were at about 90 days earlier, which has come down this quarter, and it's about 75 days right now for this quarter.

Speaker #3: And going ahead, we are opting for dealer financing as well, which will further bring down our working capital cycle. So, you should see improvement in the working capital cycle happening in the coming quarters.

Speaker #3: As I mentioned, again, our working capital cycle was majorly stretched because of a government base earlier, and the payments were due over there for a long while.

Speaker #3: But now, as we’ve changed our mode and focused more towards exports and dealer network, and within the dealer network, the payments are only about 7 to 8 days.

Speaker #3: So the working capital cycle will improve drastically to the 35–40 days level in the coming years. By FY 2010, we are targeting a working capital cycle of 35 to 40 days.

Dhruv Singla: By FY28 end, we're targeting a working capital cycle of 35 to 40 days.

Pranav Singla: By FY28 end, we're targeting a working capital cycle of 35 to 40 days.

[Analyst] (Wealth Advisory): Okay, sir. Thank you so much. That's it from my side.

Speaker #4: Okay, sir. Thank you so much. That's wonderful.

Speaker #1: Thank you. Reminder for all participants, please press star and one to ask a question. To ask a question, please press star and one. The next question is from the line of Nishita Shanklesha from Supplier Capital.

Operator: Thank you. Reminder for all participants, please press star and one to ask a question. To ask a question, please press star and one. The next question is from the line of Nishita Shanklesh from Sufaya Capital. Please go ahead.

Speaker #1: Please go ahead.

Nishita Shanklesh: Yeah, thank you for the follow-up question. I just wanted some clarification. You mentioned that by the exit quarter, you will reach close to 500 tons of sales in JTL Defence. Does that mean that by Q4 FY27 we'll reach to the 500 tons of sales?

Speaker #6: Yeah, thank you for the follow-up question. I just want some clarification. You mentioned that by the exit quarter, you will reach close to 500 tons of sales in JTL Defense.

Speaker #6: So, does that mean that by Q4, FY27, we'll reach the 500 tons of sales?

Speaker #3: Yes, that's right. That's right. So, by the exit, that's correct. We should.

Dhruv Singla: Yes, that's right. That's correct. We should.

Pranav Singla: Yes, that's right. That's correct. We should.

Speaker #6: Right. So the 500-ton sale, is that the quarterly sale number or on an annual basis?

Nishita Shanklesh: Right. The 500 tons sale is the quarterly sales number or on an annual basis?

Speaker #3: No, no. The 500 tons would be something that we'll be doing in a month, in due defense. So right now, we are doing close to 120 metric tons, as I mentioned, which was the highest for us in this quarter—this month.

Dhruv Singla: No, no, the 500 tons would be something that we'll be doing in a month in JTL Defence. Right now we are doing close to 120 metric tons, as I mentioned, which was the highest for us in this quarter this month, the first month. Going ahead by Q4, we are targeting that we will achieve 500 metric tons per month of sales of JTL Defence products.

Pranav Singla: No, no, the 500 tons would be something that we'll be doing in a month in JTL Defence. Right now we are doing close to 120 metric tons, as I mentioned, which was the highest for us in this quarter this month, the first month. Going ahead by Q4, we are targeting that we will achieve 500 metric tons per month of sales of JTL Defence products.

Speaker #3: And the first month. So, going ahead, by the fourth quarter, we are targeting that we will achieve 500 metric tons per month of sales of little defense products.

Speaker #6: Okay, okay. Understood. Yeah. Thank you so much.

Nishita Shanklesh: Okay. Understood. Thank you so much.

Speaker #1: Thank you. The next question is from the line of Dhananjay Bagrodia from Alkamai Capital Management. Please go ahead.

Operator: Thank you. The next question is from the lines of Dhananjay Bagrodia from Alchemy Capital Management. Please go ahead.

Dhananjay Bagrodia: Hi, Deep. I just wanted to ask you guys, for JTL Defence, how much CapEx are you looking to do, and what is the strategy along those lines for JTL Defence?

Speaker #7: Hi. Hi, Dean. Just wanted to ask you guys, for JTL Defense, how much capex are we looking to do? And what is the strategy along those lines for JTL Defense?

Speaker #3: Hi, Dhananjay. Hope you're doing well. So, the capex over there is not the capex for now. We are just entering into the coin segment and bullet defense segment.

Dhruv Singla: Hi, Ranjit. Hope you're doing well. The CapEx over there is not the CapEx for now. We are just entering into coil segment and billet segment. For that, we had a few machines which required renovation and a few machines we are looking to order new as well, because the machines required in the mint factory coil segment is something that needs to be updated quite frequently as well, and the same with the billet segment. The CapEx outflow for that kind of addition in this year would be not more than INR 15 crores. A similar kind of CapEx will be expected in that company in the next year as well.

Pranav Singla: Hi, Ranjit. Hope you're doing well. The CapEx over there is not the CapEx for now. We are just entering into coil segment and billet segment. For that, we had a few machines which required renovation and a few machines we are looking to order new as well, because the machines required in the mint factory coil segment is something that needs to be updated quite frequently as well, and the same with the billet segment. The CapEx outflow for that kind of addition in this year would be not more than INR 15 crores. A similar kind of CapEx will be expected in that company in the next year as well.

Speaker #3: So for that, we had a few machines which require renovations. And a few machines, we intend to order new as well, because the machines required in the mint factory coin segment are something that need to be updated quite frequently as well.

Speaker #3: And the same for the bullet shell. So, the capex outflow for that kind of addition in this year would be not more than ₹15 crore.

Speaker #3: And a similar kind of capex would be expected in that company in the next year as well.

Speaker #7: So this will not change the—

Dhananjay Bagrodia: this will-

Dhruv Singla: This will not change the capacity of the company. This will change the product placement of the company. For example, for now, the capacity over there is close to 1,000 tons that we can do per month. Going ahead, and when I talk about 1,000 tons a month, this is the hot-dip capacity. Going ahead, this product which we are placing to automobile segment right now, and dealer segment right now, which is the copper foil and sheath, these will be converted to bullet shells segment and also towards mint factory, which will further provide value addition to the company and bumper with the margins. For that, INR 15 crores of CapEx is something that you can expect this year and similar amount in next year as well.

Pranav Singla: This will not change the capacity of the company. This will change the product placement of the company. For example, for now, the capacity over there is close to 1,000 tons that we can do per month. Going ahead, and when I talk about 1,000 tons a month, this is the hot-dip capacity. Going ahead, this product which we are placing to automobile segment right now, and dealer segment right now, which is the copper foil and sheath, these will be converted to bullet shells segment and also towards mint factory, which will further provide value addition to the company and bumper with the margins. For that, INR 15 crores of CapEx is something that you can expect this year and similar amount in next year as well.

Speaker #3: capacity of the company. This will change the product placement of the company. For example, right now, the capacity over there is close to 12,000 tons, or 1,000 tons that we can do per month.

Speaker #3: So going ahead, and when I talk about 1,000 tons a month, this is the hot mill capacity. So, going ahead, this product which we are placing in the automobile segment right now and dealer segment right now, which is the copper foil and sheets, these will be converted to billet sales and segments.

Speaker #3: And also, towards the mint factory, which will further provide value addition to the company and improve the margins. So for that, ₹15 crore of capex is something that you can expect this year.

Speaker #3: And a similar amount in the next year as well.

Speaker #7: And just to have a little broader view, just like two, three years down the line, do we predominantly see the shell company? Any revenue targets or anything in mind?

Dhananjay Bagrodia: Just to have a little broad-based, let's say two, three years down the line, Defense, we would predominantly see a shell company. Any revenue targets or anything in your mind? Just broad-based, any idea what it could be, how large it could be? What are we thinking?

Speaker #7: Like, just, like broad-based—any idea what it could be, how large it could be? What are we thinking?

Speaker #3: So it's going to be a mix of everything. I won't say that it's entirely going to be the defense company, only bullet sales segment, because the bullet sales segment—if you talk about the cap itself—it's a 4-gram product.

Dhruv Singla: It's going to be a mix of everything. I wouldn't say that it's entirely going to be defense company, only the bullet shells segment, because the bullet shells segment, if you talk about the cup itself, it's a 4-gram product. It's not a thing that even if I do volumes as well, I can achieve quantity, what the entire capacity of the plant is. Around 25% and 30%, which is close to 200 tons, is something that we can focus, will go towards the mint factory, which is towards coin segment. 30% and 35%, which is close to 350 tons of material, will go towards bullet shells and casings. The remaining product, which is close to 350 more tons, will be going towards the current dealer and automobile market.

Pranav Singla: It's going to be a mix of everything. I wouldn't say that it's entirely going to be defense company, only the bullet shells segment, because the bullet shells segment, if you talk about the cup itself, it's a 4-gram product. It's not a thing that even if I do volumes as well, I can achieve quantity, what the entire capacity of the plant is. Around 25% and 30%, which is close to 200 tons, is something that we can focus, will go towards the mint factory, which is towards coin segment. 30% and 35%, which is close to 350 tons of material, will go towards bullet shells and casings. The remaining product, which is close to 350 more tons, will be going towards the current dealer and automobile market.

Speaker #3: So it's not a thing that, even if I don't volume this as well, I can see quantitatively what the entire capacity of the plant is.

Speaker #3: So, around 25 to 30 percent, which is close to 200 tons, is something that we can focus on will go towards the mint factory, which is for coins and segments.

Speaker #3: And 30 to 35 percent, which is close to 350 tons of material, will go towards bullet shells and casings. And the remaining product, which is close to 350 foreign tons, will be going towards the current dealer and automobile market.

Speaker #3: So, for example, we have Minda Corp, which is one of the similar automobile companies we are targeting, and in which we are getting healthy margins as well.

Dhruv Singla: For example, we have Linde, who is one of the biggest procurers for copper foils right now. There are a lot of similar automobile companies we're targeting, in which we are getting healthy margins as well. It's safe to say that 30% will be automobile and dealer network, 35% will be defense, and the remaining will be mint factories.

Pranav Singla: For example, we have Linde, who is one of the biggest procurers for copper foils right now. There are a lot of similar automobile companies we're targeting, in which we are getting healthy margins as well. It's safe to say that 30% will be automobile and dealer network, 35% will be defense, and the remaining will be mint factories.

Speaker #3: So it's safe to say that 30% will be automobiles and dealer network, 35% will be defense, and the remaining will be mint factories.

Speaker #7: Understood. Thank you, Pranav. This is really, really helpful. And congratulations.

Dhananjay Bagrodia: Understood. Thank you, Palav. This was very helpful. Congratulations.

Dhananjay Bagrodia: Understood. Thank you, Pranav. This was very helpful. Congratulations.

Speaker #3: Thank you. Thank you, Dhananjay. Thank you, Dhananjay.

Dhruv Singla: Thank you, Ranjit.

Pranav Singla: Thank you, Dhananjay .

Dhananjay Bagrodia: Thanks, Ranjit.

Dhananjay Bagrodia: Thanks, Dhananjay .

Speaker #1: Thank you. Reminder for all participants: please press star and one to ask a question. Participants who wish to ask a question, please press star and one.

Operator: Thank you. Reminder for all participants, please press star and one to ask a question. Participants who wish to ask a question, please press star and one. As there are no questions, the last question has been completed. I now hand the conference over to the management for closing remarks. Over to you, sir.

Speaker #1: As there are no further questions, the last question has been completed. I now hand the conference over to management for closing remarks. Over to you, sir.

Dhruv Singla: Thank you everyone for joining our earnings call. I hope we were able to give you the answers to your queries. If you have any further questions or would like to know more about the company, please reach out to our investors' team. Thank you.

Pranav Singla: Thank you everyone for joining our earnings call. I hope we were able to give you the answers to your queries. If you have any further questions or would like to know more about the company, please reach out to our investors' team. Thank you.

Speaker #3: Thank you, everyone, for joining our earnings call. I hope we were able to give you the answers to your queries. If you have any further questions or would like to know more about the company, please reach out to our Investor Relations team.

Speaker #3: Thank you.

Operator: On behalf of Nuvama and JTL Industries, that concludes this conference. Thank you for joining us, and you may now disconnect your lines.

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Q1 2027 JTL Industries Ltd Earnings Call

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