Operator: Ladies and gentlemen, good day and welcome to the Welspun Specialty Solutions Q2 FY27 earnings conference call hosted by 361 Capital Market. 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 Mr. Anand Darshan from 360 ONE Capital. Thank you, and over to you, sir.
Anand Darshan: Hello. Thank you, Aldrin, and a warm welcome to everyone on this call. On behalf of 361 Capital, I would like to thank the Welspun Specialty Solutions team for giving us the opportunity to hold this interaction. I would now like to invite Mr. Gautam to introduce the management team. Over to you, Gautam.
Goutam Chakraborty: Thank you, Anand, and good evening, everyone. On behalf of Welspun Specialty Solutions Limited, I welcome all of you to the company's Q2 and H1 FY27 results call. Along with me, we have Mr. Anuj Burakia, Chief Executive Officer and whole time director, Mr. Navin Agarwal, Chief Financial Officer, and Mr. Harsh Lunkar, Group Head, Investor Relations for Welspun World. I hope you have had a chance to review the investor presentation that was filed with the exchanges. The presentation is also available on our website, and during today's discussion, we may be making references to this presentation. Request all of you to please refer to the safe harbor statement mentioned in our presentation. We will start the forum with the opening remarks by Mr. Burakia, and then we will open the floor for the Q&A. Now let me hand over the floor to Mr. Burakia.
Goutam Chakraborty: Over to you, sir.
Anuj Burakia: Thank you, Gautam. Good evening, everyone. A warm welcome to the Q2 and H1 FY27 earnings conference call of Welspun Specialty Solutions Limited. Thank you for joining us today. I will start with a short overview of the global and Indian macroeconomic environment. I will then cover the industry landscape and our company's performance for the quarter and the half year. After that, we will open the floor for your questions. The IMF's World Economic Outlook, released in October 2026, projects global growth of 3.1% in 2026 and 3.4% in 2027, compared with 3.5% in 2025. The 2026 estimate is slightly higher than the earlier forecast of 3%. The IMF describes the global economy as resilient but under strain. The conflict in the Middle East is keeping energy prices high and disrupting key shipping routes, which has pushed global inflation up.
Anuj Burakia: Strong investment in artificial intelligence and technology is supporting the activity, but the gains are limited to a few economies. Growth is uneven, and energy importing countries are under the most pressure. Overall, the global outlook remains highly uncertain and business sentiment is cautious. India is still the fastest growing major economy. The IMF has raised India's growth forecast for this financial year to 7%. In its October policy, the Reserve Bank of India also raised its FY27 GDP growth projection to 7.1%, supported by strong private consumption and investment. Food and fuel prices are rising, so the RBI increased its inflation projection to 5.2% and raised the repo rate by 25 basis points to 5.5%. Against this backdrop, the export business faced tougher operating environment during the quarter.
Anuj Burakia: High energy prices and disrupted sea routes drove freight costs up sharply, and this pushed up raw material and scrap prices. Because these cost increases came in a shorter period of time, could be passed on only partially through selling prices, which put pressure on our margins. Trade barriers also tightened. For the first time, the average safeguard duty on stainless steel bars exported from India to Europe went about 20% up from a maximum of under 10% before. This has further weakened the sentiment in one of our most important markets and put pressure on finished product prices. Weak sentiment, together with delays in finalizing contracts and in delivery schedules, hurt our tube sales volume in Q2. Even so, our bar business performed well. Bar sales volume in Q2 grew by about 20% year-on-year, driven mainly by our growing market penetration.
Anuj Burakia: In tubes, our closing order book is about four months of volume, with most deliveries scheduled across Q3 and Q4 of this financial year. A good share of it is heat exchanger tubes. These are value-added products, but they take longer to manufacture and deliver. Our team is working closely with our customers to meet spot delivery needs and reach our target sales volume. Our tube bid book is healthy at about 10 months of volume or more, and most of these projects are due to be finalized this quarter or the next. Given the balance between consumption and capacity, we are confident that export markets will improve significantly and open up more value-added opportunities as conditions gradually stabilize. The domestic market continues to offer strong growth, with some short-term gaps in demand.
Anuj Burakia: As India's only integrated manufacturer of extruded stainless steel pipes and tubes, we are well-placed to supply complex, value-added products for oil and gas, petrochemical, thermal and nuclear power, defense, and other sectors. Now to our performance for the quarter and half year. Total income for Q2 was INR 242 crore on sales volume of about 8,800 metric ton. For H1 of FY27, total income was INR 440 crore on sales volume of about 15,000 tons. The reported EBITDA was about INR 4 crore for Q2 and INR 19 crore for H1 of FY27. Cash PAT was INR 1 crore for Q2 and INR 10 crore for H1 of FY27. We continue to widen our product range and grow our customer base. New products included vacuum degassed, stainless steel forging ingots, and heavy wall P91 tubes.
Anuj Burakia: We added 24 new customers during H1 of financial year 2027. I am pleased to share that ADNOC, the Abu Dhabi oil and gas major, has approved our pipe product, and we expect approval for tubes very soon. Our SIRIM certification for the Malaysian market is also in progress with the audit scheduled for November. These certifications and more like these will create more opportunities for our tubular business going forward. During the period, our team won orders for several specialized products. These include long length tubes of up to 24 meters long, moderator heat exchanger tubes for nuclear power, and duplex fin tubes, et cetera. These orders show our growing technical capability in high value applications. We have also delivered our first validation order for CGD instrumentation tubing. We are now pursuing commercial orders and more OEM approvals in this segment.
Anuj Burakia: We expect the near term to stay challenging because of high energy and freight costs, trade barriers, and cautious customer sentiments. At the same time, several aspects encourage us: a healthy bid book, steady customer engagement, strong domestic market prospects, our progress on product and customer approvals. Our priorities for the coming quarters are converting our bid pipeline into firm orders, raising volumes and capacity utilization, keep a sharp focus on cost optimization and working capital discipline. We are confident that despite the current environment, WSSL will improve its performance and meet the stakeholders' expectations. Over the medium to long term, global supply chain diversification and India's growing role as a preferred manufacturing destination will open up significant opportunities. We believe Welspun Specialty is well-positioned to benefit from these trends. Sustainability remains a key business priority.
Anuj Burakia: We continue to increase the share of renewable energy in our operations and to reduce our emissions intensity through better operating efficiency. We expect renewable energy to make up to two-thirds, that is about 67%, of our total energy use in financial year 2027, up from 58% in financial year 2026. With that, I would like to open the floor for questions, please. Thank you.
Operator: Thank you. We will now begin with the Q&A session. Anyone who wishes to ask a question may press star and one on their touchtone 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 comes from the line of Josh Burji with Josh Burji Investments. Please go ahead.
Josh Burji: Hello, am I audible?
Operator: Yes, you are.
Josh Burji: Hi, Anuj sir.
Anuj Burakia: Hello. Welcome.
Josh Burji: Yes. I had a question on the ADNOC approval for pipes. Regarding the qualification for tubes, how soon do we expect this to happen for the tubes also?
Anuj Burakia: Mr. Josh, these applications were all done parallel and the evaluation is also done parallel. We do not have access to their internal systems, but we believe that when the pipe has been released, tube would be released anytime soon.
Josh Burji: Okay, great. Could you please walk me through the FY27 and FY28 capital allocation framework that we have internally thought of?
Anuj Burakia: On the capital allocation, if we are talking of the capital investments-
Josh Burji: Yes
Anuj Burakia: I can say that except for some maintenance CapEx, which I would say not a significant amount, we have no plans for making any capital expenditure during financial year 2027 and 2028. Unless there is very specific opportunity comes our way for a specific project which entails some kind of an investment. In general, we do not have any plans for any significant CapEx.
Josh Burji: Okay. Got it. How does the management view the internal, basically the domestic pricing cannibalization that is happening for our products? Are we seeing a lot of competition in this or?
Anuj Burakia: See, I put it very simple. It is always a mismatch between the demand and supply that causes the troubles, right? What has happened at this point in time, this is an overall a healthy segment and a healthy industry. Incidentally, given the situation outside, the demand has dried up. Or let us say the demand is coming even in India in pockets. Sometimes you have good RFQ load, and sometimes it just dries up for in between patches. So, that has in a way created a little bit of an oversupply you can say, or desperate selling in pockets. But I believe this is not going to be a permanent situation. We are sure with little bit of an improvement in the environment, we will see this trend discontinuing.
Josh Burji: Okay. All right. Thank you so much. I will get back in the line.
Anuj Burakia: Thank you, Mr. Josh.
Operator: A reminder to all participants, you may press star and 1 to ask a question. The next question comes from the line of Shaurya Shah with Equirus Securities. Please go ahead.
Shaurya Shah: Yeah, thank you for taking up my question. So the first is, with the tariff and import duties from Europe coming in, what portion of historical kind of export revenue would be directly impacted because of this? And a connecting question is that, are we internally thinking about any mitigation measures or any turnarounds to kind of get through this challenge?
Anuj Burakia: Yeah, good question, Mr. Shaurya. So see, first of all, let me put it this way that this challenge is not new. This had been there for a long time and only thing is that it had been intensifying. As I would have also discussed in previous interactions that for a long time, more than probably three to four quarters, in Welspun Specialty strategy, we had already started to divert ourselves more to the non-EU markets like India and elsewhere. What has happened in between is that whatever exports were still going into EU and which were highly competitive, with the recent increase in the duty and reduction in the safeguard quotas, those capacities also are under tremendous strain. So whatever quantity was going out of the market into the EU is also going to now choke our market.
Anuj Burakia: So that is how it is creating a strain in some way. However, this is true for the general sentiment. As far as we are specifically concerned, the products that we are selling and to the extent they are different from these general commodities, we will have our edge. So we are not going to be completely impacted. But yeah, from the sentiment standpoint, and especially now when the demand is weak, this is really creating a kind of a price pressure.
Shaurya Shah: Okay, understood. For the ADNOC approval, I wanted to understand more about this. So what will be the use case for the approval of the specific pipes that was received from ADNOC? This will specifically be for oil and gas application, right?
Anuj Burakia: See, ADNOC is a major company and is into oil and gas. Like any other major oil and gas company, generally, the approvals are required if any company wants to supply anything directly or indirectly in their ecosystem. So our approvals are mainly targeted to supply tubes and pipes to, let's say, the fabricators who are fabricating equipment for ADNOC, for example. So fabricators in India, fabricators in Europe or elsewhere, they get orders from oil and gas majors to manufacture heat exchangers or condensers or other kind of equipment for them, and in which they can only utilize the tube or pipes from the approved sources.
Shaurya Shah: Understood.
Anuj Burakia: Yeah.
Shaurya Shah: This as well might be able to kind of, let's say, reduce our exposure to Europe, right? Because it's not just Welspun Specialty, but I've heard many other companies as well which are starting to get approvals from companies like Aramco and ADNOC. So I think that will also help us mitigate exposure to Europe, right?
Anuj Burakia: Yeah. In a way, yes. You see this trend is coming because India is being viewed as a preferred partner for trade. In a way you can say that earlier there used to be more business going into other than Indian market for fabrication or fabricated equipment. But now we can see that trend growing, that more and more Indian fabricators are picking up businesses from these oil and gas majors, thereby creating better or higher demand within the country.
Shaurya Shah: Got it. Yeah, those are the questions from my side. Thank you.
Anuj Burakia: Thanks. Thank you.
Operator: Participants, please press star and 1 to ask a question. The next question comes from the line of Parth Bhavsar with Investec India. Please go ahead.
Parth Bhavsar: Hi, sir. Thank you for the opportunity. Sir, my first question is on Q2, especially the piping segment. Can you throw some light on why the piping volumes saw such a big decline? Was it a very conscious call that we do not want to sell our pipes and make negative margins? Was it pricing pressure? If you could just throw some light on the piping segment.
Anuj Burakia: Hi, Parth. I think I spoke about it in good details in my opening remarks. However, honestly speaking, this is not that we by choice would not want to do volume or go for low margins. But the fact remains that there had been pressure on order booking and demand. While the orders were coming in, the nature of, or the composition of order book is such that the deliveries have to happen in a scattered manner over next couple of quarters. As we speak, we have a four months order book which is scattered, and at the same time the bid book is also equivalent to 10 months. In nutshell, I can say that perhaps the Q2 sort of turned out to be a quarter with the full concentration, and received the maximum effect.
Anuj Burakia: Things should start improving from here on, and we will see good progress coming our way during this quarter and the next.
Parth Bhavsar: Sir, when we say that, can one expect your average numbers in Q3, Q4 to come back to maybe above 1.3 KMT sort of numbers for piping, which is the last four quarter average?
Anuj Burakia: Well, I would say yes, I have that confidence, Parth.
Parth Bhavsar: Okay. Sir, just last one question. Sir, if you just wanted to get a sense on how demand undercurrents are in three, four pockets. If you just had to rank India, Middle East, and Europe, how would you rank these three places, depending on their demand undercurrents?
Anuj Burakia: See, as far as our product is concerned, and you see stainless steel industry as such is very big. Metal industry is even bigger. I would not include that. I would only restrict myself to the very specific relevant bars and let's say seamless pipes and tubes. Of course, Europe is one big consumer. At the same time, if a smaller percentage of demand rise in Europe will create more impact in the overall market, than a higher percentage of demand rising in India. Currently, demand is definitely slow in every portion. However, India, because of its current trajectory of growth, there is demand in India, but you see with the little dry spells, let us put it this way.
Anuj Burakia: I think overall we are very optimistic or very bullish on the Indian demand, if I look at next three to five years of scenario, not one or two quarters. Therefore, we are very focused on the Indian market. At the same time, at some point in time, Europe will bounce back. See, for the last two and a half years, if you see, Europe had been going slow on the overall basis. Which is what is also compelling the industry there to kind of lobby for bringing in these trade restrictions for imports. But in the end, the overall demand and capacity dynamics, if you see, the markets will open at some point in time. Yes, near future looks to be challenging in that sense. But in the end, the markets will definitely open up.
Anuj Burakia: We would, for our business, be very bullish and relying on our own domestic Indian market for a larger share. At the same time, continue to sell into Europe, Middle East, other markets, and keep a watch for the right time to increase our exposure.
Parth Bhavsar: Perfect. Got it, sir. Thank you so much for answering my questions.
Anuj Burakia: Thank you.
Operator: A reminder to all participants, you may press star and one to ask a question. The next question comes from the line of Anand Darshan with 361 Capital. Please go ahead.
Anand Darshan: Hello, sir.
Anuj Burakia: Yeah, hello.
Anand Darshan: Can you speak on the export business opportunities we have in the Europe and Southeast Asian markets, sir? I mean, what is our right to win there, and do we need to have any technology partner to scale the business in those markets?
Anuj Burakia: Okay. You see, in the export, if I look at what we were doing three years back, I think more than 50% to 60% of our sales were going into export. Out of export, 90% plus was going into the European markets. Which means that as far as the product is concerned, the acceptability is concerned, I mean, that is nowhere a factor which is affecting our sales prospects there. The real effect started to come ever since US decided to impose 50% duty on every other country who was selling into USA. The moment that happened, the biggest impact that it brought was that while the European manufacturers of stainless steel were selling a large portion of their produce into the United States, suddenly found themselves standing with a very, you can say, shrunk market.
Anuj Burakia: Because with 50% duty, it was nearly impossible to continue to sell into a market. That is where the availability in the domestic market EU increased. So two things happened. One is the availability increased, which means the prices in EU started to go under pressure, number one. Number two, the industry there again, then they obviously represented to the government and asked for the protection for that industry in the wake of US duties. That created kind of a total blockage or let's say a big restriction on the erstwhile supply chain, wherein Indian companies and other countries, they were selling into European market and also US markets. Europeans were selling into US market. US was exporting very little. This is how the whole thing was operating. That got choked.
Anuj Burakia: The effect that we are seeing is this, that in India, you say we are fortunate that Indian market is growing and our products are such that we are able to tap that opportunity. The reduction in export has definitely affected us, but not so much as if the Indian market would not have performed well. So, in the near term, as I said earlier also, the exports are going to be a challenge, not because of the technical capability or because of absence of right to win as far as the technical aspects are concerned or the quality is concerned, but more to do with the protection of domestic industry measures that have been implemented by various countries.
Anand Darshan: Thank you. Sure.
Anuj Burakia: Could I-
Anand Darshan: Another question I have.
Anuj Burakia: Yeah, please. Go ahead.
Anand Darshan: What is our growth outlook for this financial year, and are we on track to achieve our previously stated guidance, say that 20% to 30% of volume growth which we have quote unquote on?
Anuj Burakia: Yeah. So I would say, Mr. Anand, I think whatever strategy we had and we were working on, we still continue to work on that. But you see-
Anuj Burakia: the situation sometimes becomes such that despite whatever right actions one takes in business, the external environment pushes you back.
Anand Darshan: Thank you.
Anuj Burakia: I think we are still on the path. Our strategy is very clear. We are working on that, and the reflection is coming in our bar product, but unfortunately in tubes, definitely this quarter was a setback. Having said that, this is not a permanent situation, and I think we are already in a good shape. We will definitely get there. Maybe that gets delayed by a couple of quarters, and then that is about it.
Anand Darshan: Correct
Anuj Burakia: We are on the path. Yeah.
Anand Darshan: Great. That's all the questions.
Anuj Burakia: Yeah. Thank you.
Operator: Participants, please press star and one to ask a question. The next question comes from the line of Dhiral Shah with PhillipCapital. Please go ahead.
Dhiral Shah: Yeah. Good afternoon, sir. Thanks for the opportunity. My question is again pertaining to the European market. In terms of the overall domestic demand in the European market, how big is the market opportunity over there, and how much they are sourcing from the domestic player locally, and how much they are reliant on imports, sir?
Anuj Burakia: Dhiral, if I talk of long products market in EU, there are various ways in the market can be defined. Long product bar, if I only consider as a topic for discussion, I think the total production capacity in Europe would be about half a million tonnes. But see, the market size is not about what a country or a region produce. The market is how much can they consume. How the demand-supply balance still exists, that, okay, if I consume 100,000 tonnes and if you produce 200,000 tonnes, until I have an outlet for this additional 100,000 tonnes elsewhere, the markets remain healthy.
Anuj Burakia: As I explained just two questions back, this disruption has all been caused because of some trade actions that were initiated primarily by USA to start with, and which were then followed by various other countries in order to protect their respective industry. But one thing is a fact. After this has been done, what we are seeing is that in some of the locations, and especially in US, if you see the price run-up of commodity and steel, it is perhaps significantly higher than the rest of the world. Which means to me it appears to be like an unsustainable situation. If let us say we are selling something in India for INR 100, in Europe it sells for INR 120, it is okay. But in a third location, if it is selling for INR 200.
Anuj Burakia: You can imagine that ultimately the burden is going somewhere on the capital goods creation and ultimately getting transferred to the consumers.
Dhiral Shah: Okay.
Anuj Burakia: The imbalance, we feel is at some point in time will correct itself, and that is where we will see the churn of export and imports again coming back to some extent.
Dhiral Shah: Okay. So again, sir, as you mentioned that on the long bar the market is almost half a million tonne. How about the case of stainless steel pipes and tube?
Anuj Burakia: So stainless steel pipe and tube global market is about half a million tonnes. It is not a very huge market. It is a limited market, and of course it is growing. It is growing by, if I go by some data of some, let us say, analysis done by some of these companies, it is about 4% to 5% global growth. I would not include last one or 2 years because this has been really disruptive. That is the total market. We do not see great new capacity getting created other than what got created in India in last 2 years. Other than that, we do not see any great capacities that are getting built.
Dhiral Shah: Okay. And sir, apart from India, are there any other competing nation who is also getting this incremental duty which European Union have put upon? Are these other nation competitors also facing the same duty when it comes to export to the Europe market?
Anuj Burakia: The quota effect that has come on every other country which were exporting to EU, some more, some less. The real competition now is not with a third country who is also exporting into EU, right? The real competition now is that with the average duty incidence, which has now become, you can say anything between 20% to 30%, because it is a formula calculation that happens every quarter. That difference is too much to be absorbed by an importer in EU compared to the local EU mill prices. You understood my point?
Dhiral Shah: Yes.
Anuj Burakia: So till the time if I sell for 100, they are anyway going to be landing it at about 130. Here is European mill who says, "Okay, I am prepared to sell at 125." So for them, it doesn't make sense to buy from India and incur this kind of duty. This duty, before the increase of the recent increase, used to be in the range of anything between 6% to 10% maximum. Right? So there was a room for us or for Indian industry to sell, still keeping some amount of delta between the European mill price and the Indian cost, which now has got disrupted, and that is how we are seeing this sudden die down of the export volumes to Europe.
Dhiral Shah: Okay. And sir, lastly, just one question on the domestic side. As you mentioned that overall volume will come back. So in the domestic market, which are the sectors that you are witnessing that there could be a good demand going there, specifically to the stainless steel pipes and tubes segment, sir.
Anuj Burakia: If you look at the bulk consumption, that is definitely happening into thermal energy and other energy sectors. Nuclear is coming up, but volume wise, it is not huge at this point in time, but at least it is much better, a lot better than what it used to be three years back or two years back or last year. So it is gradually increasing. More and more reactors are coming for offering. It's a slow process, let's put it this way. So we are expecting this business to grow with every quarter or every year. The third is the fabrication industry. There is a traction we can see, both from, let's say, the heat exchangers and the other equipment, the heaters, high pressure heaters, which business is getting generated again from the thermal and nuclear segment.
Anuj Burakia: Wherein they are in the market to buy tubes for fabricating these equipment. Also, these fabricators are receiving a lot of business from Middle East and elsewhere for fabricated equipment for oil and gas refineries and things like that. So I think Indian market overall is buoyant. But, yes, there are patches which are little, it's like dry spells in between. But in overall, market looks promising and we are very bullish on the overall Indian consumption.
Dhiral Shah: Okay. Thank you so much, sir, for answering the question.
Anuj Burakia: Thank you.
Operator: Participants, you may press star and 1 to ask a question. The next question comes from the line of Josh Burji, with Josh Burji Investments. Please go ahead.
Josh Burji: With respect to the Middle Eastern EPC contractors, how soon do we expect purchase orders from commercial tenders, waiting translating to purchase orders?
Anuj Burakia: Josh, I think a bit difficult question to answer, but let me put it this way. Middle East, it's a large geography, and I am sure all the oil and gas companies there, they are buying for their equipment from various fabrication suppliers, including in India. That is how these fabricators are generating inquiries for buying tubes and pipes to be used for fabrication. Currently our order book also comprises of, I think, more than 60% to 70% of the volume, which is from this segment that you just mentioned about. So the orders are already getting converted. We are only to see as to how much this volume really, how it pans out in next few quarters, whether the volumes increase or they remain stagnant or how the market moves. But I think overall, Middle East is buoyant.
Anuj Burakia: Of course, they are currently passing through a very difficult time with all the war and all that situation. But on the whole, I think that is another region to be kept under watch.
Josh Burji: Got it. Perfect. I think the presentation mentions order booked for heat exchanger for nuclear. Is this the same order that we had got from NPCIL or this is through a tier 1 fabricator like BHEL or someone?
Anuj Burakia: See, NPCIL directly buys very rarely.
Josh Burji: Okay.
Anuj Burakia: The order will definitely only come through tier 1 fabricator, which is approved by NPCIL and also the tube source is approved by NPCIL. Generally, NPCIL undertakes specific approval equipment wise. I am happy to announce that for moderator, which is one of the critical heat exchangers, also we got a specific approval after due audit and validation of all the aspects from NPCIL.
Josh Burji: Great. This is a separate order, right? From a previous order that we got.
Anuj Burakia: Previous, I am not sure which one you are referring to, but we have been picking up nuclear order from time to time. This one from the criticality standpoint is quite important for us. Also important because as the nuclear demand is increasing with time, this one particular equipment is such that after having done this, your positioning within the nuclear framework becomes very strong.
Josh Burji: Got it.
Anuj Burakia: From that aspect, I mean, not only commercially, strategically also, I think this is an important project for us.
Josh Burji: Okay. Thank you so much for your time.
Anuj Burakia: Thanks.
Operator: A reminder to all participants, please press star and 1 to ask a question. The next question comes from the line of Parth Bhavsar with Investec India. Please go ahead.
Parth Bhavsar: Yeah. Sir, I just had one question. I wanted to understand the competitive landscape in India. I believe a lot of demand or incremental demand that we are looking at is from thermal energy. Just wanted to understand how the landscape has changed over the last 3 or 5-year period. Has it become more intensive? Or is it that our product offerings does not compete with the likes of guys who make pipes through piercing route?
Anuj Burakia: See, generally speaking, Parth, piercing product is obviously cheaper to produce and has its own characteristics. I would not get into details of the, let's say, merits, demerits and all those things. But the fact remains, within thermal, there are both category of products. One where the extrusion is compulsory and obviously, there the competition landscape is entirely different from the one that you referred about, is where both the routes are accepted. Then there is a third differentiation whereby the different OEMs. When I say, for example, NTPC is the owner of a project. Similarly, there could be another owner which could be, for example, Adani Power. Third could be Reliance Power. So, different owners also define their own specifications.
Anuj Burakia: For the same product, there are still some OEMs that prefer the route that we employ, and I think if I make a sum total of the opportunity that we as extrusion player have from the overall thermal power sector, I mean, it's significant.
Parth Bhavsar: Is it safe to assume that it is enough for all the players to grow over the next, maybe, 3 to 5 years?
Anuj Burakia: I would think so, Parth. Just for benefit of everybody's information, those who have not read this, very recently, I think beginning of this week, the government has announced revising the erstwhile plans of 90 gigawatt to be completed by 2035, has been now revised to 150 gigawatt. Yeah. So this segment will definitely generate a lot of business. The only thing that government needs to see is how to speed up the execution part. For that, I am sure they are working with many EPC companies to find out solutions and like it happened in case of highways. The speed of highway construction, how over a period it grew, it multiplied. So it seems that with the thermal power sector, the similar story is going to repeat.
Parth Bhavsar: Sir, if we assume that 150 gigawatt does get executed, is there a way to understand what would be our TAM?
Anuj Burakia: Sorry, what would be? Total addressable—
Parth Bhavsar: Basically our market that we can cater to.
Anuj Burakia: Well, what I can say is approximately 1 gigawatt normally entails, if I say very simplest product, including the stainless steel and high alloy boiler tubes, approximately 3,000 tons and maybe another 500 tons for other non-boiler equipment which require the stainless steel seamless tubes. So each megawatt approximately 3,500 tons to 4,000 tons, depending on the design.
Parth Bhavsar: Perfect. Sir, this is very helpful. Sir, thank you so much for answering my questions.
Anuj Burakia: Yeah. Each megawatt, did I say?
Parth Bhavsar: Gigawatt.
Anuj Burakia: Yeah, gigawatt. I mean, a correction. Each gigawatt. Yeah.
Operator: A reminder to all participants, you may press star and 1 to ask a question. Ladies and gentlemen, as there are no further questions, I would now like to hand the conference over to the management for the closing remarks.
Anuj Burakia: Thank you. The H1 of FY27 has tested us and the wider industry. Energy and freight costs rose, trade barriers went up, and demand stayed weak. We used this period to strengthen our foundation. We added customers, secured approvals, deepened our market penetration, and built a strong order book and bid pipeline. As these conditions gradually stabilize and recover, we believe this work will help us improve our performance in the coming quarters and beyond. We hope we have answered your questions. If you have any further queries, please contact our investor relations team. We will be happy to help. Thank you once again for joining us today. We look forward to speaking with you again soon. Thank you.
Operator: Thank you, sir. Ladies and gentlemen, on behalf of 361 Capital Market, that concludes this conference call. Thank you for joining us, and you may now disconnect your lines.
