Ladies and gentlemen, good day and welcome to Welspun Corp Limited Q3 FY26 Earnings 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 and zero on your touch-tone phone. Please note that this conference is being recorded. I now hand the conference over to Sir Anirudh Nagpal. Thank you, and over to you, Sir.
Thanks, operator, and welcome everyone to the call. I will first thank Welspun Corp for giving JM Financial the opportunity to host today's call. So without much ado, I'll hand over the call to Mr. Goutam Chakraborty, Head Investor Relations Welspun Corp, to introduce the management. Over to you, Goutam.
Thank you, Anirudh, and good afternoon to all of you. Welcome everyone to the Q3 and nine months FY 2026 earnings call of Welspun Corp Limited. On this forum today, we have Mr. Vipul Mathur, Managing Director and CEO, Mr. Percy Birdy, Chief Financial Officer, and Mr. Nilesh Mazumder, CEO of Sintex. You must have gone through the results and investor presentation of the company, which are also available on the stock exchanges and as well as on our website. During the discussion, we may be making references to the presentation, so I request you to please refer to the safe harbor statement in our presentation. As usual, we'll start this forum with the opening remarks by Mr. Mathur, and post that we'll open the floor for Q&A. With that, let me hand over the floor over to Mr. Mathur. Over to you, Sir.
Thank you. Thank you, Goutam. I shouldn't say productive, but friends, a very good afternoon to everyone. I welcome you all for the Q3 FY26 earnings conference call for Welspun Corp. First and foremost, since we are interacting for the very first time in this new year, I wish all of you a very happy and a prosperous 2026. As practice, I would first like to discuss our key operational and financial highlights of the concluding quarter. I will then dwell down on the business environment, and rather I would like to spend a lot more time on the Q&A today because I am sure that all of you would have seen the investor presentation, and a very detailed outlook has already been provided. So I think we should utilize the time, and we can go ahead for a more Q&A. I think that will be more helpful.
However, if you want any more detailed information, we are more than willing to do that. So some of the key operational highlights for this particular quarter was that the line pipe sales volumes for India and U.S. stood at almost 265,000 tons. The DI pipe sales stood at almost 92,000 tons. The stainless steel bars and pipe sales volume stood at almost 6,000 tons and 1,600 tons, respectively. We have been able to maintain a consolidated global order book at a record high of almost INR 23,600 crore, bringing consistency and long-term visibility across our global operations, across the U.S.A., across India. And on Sintex, as we have always said, we have been focusing on channel expansion, branding, premium product launch continues. The strong potential for OPVC market is absolutely now in play, and now Sintex is securing major approvals for the OPVC and panel in the various states.
Execution and the dispatches of OPVC materials have already started. Some of the key financial highlights are our Q3 FY26 EBITDA stood at INR 645 crore. It is the highest ever quarterly EBITDA with consistent growth over the last eight quarters and improved margins. This is after a one-time cost of approximately INR 25 crore on account of gratuity and leave encashment provisions due to the new labor code. Our annualized gross stands at more than 24%. The PAT for this quarter stands at INR 453 crore. If you would have seen, the last year Q3 PAT had a one-time gain of INR 378 crore on account of proceeds from sale of EPIC shares. So if we reduce that one-time gain in the last quarter of the last financial year, the PAT is significantly higher in this particular quarter.
In spite of the CapEx of almost INR 1,700 crore during the nine months in FY2026, we continue to maintain a net cash position of almost INR 132 crore. If you see, we had given a guidance of close to INR 2,200 crore for the whole financial year, and in the nine months, EBITDA guidance of INR 2,200 crore, and in the nine months, we are already at INR 1,831 crore. This very clearly suggests that the company is well on track and should comfortably achieve or exceed the full-year guidance, and we will talk a little more when we deep dive into the Q&A part of it. I would quickly go to the business environment section, and just to give you very broad highlights as to how do we see the market happening across all the geographies and across all the products. First off, let's talk about the U.S.
I think the U.S. market continues to be into a bullish mood. We are seeing a significant continuing demand for the pipelines, and they are all driven by basically for gas pipelines, either for LNG export or primarily for data centers. We are seeing a surge of data centers coming up in the U.S., and with each data center, they have to have their own power plant, and all those power plants require uninterrupted gas for which pipelines are required. So we are into the part of the value chain of the AI data center, and we are seeing a huge surge around at this point in time. If I have to put some numbers, there are almost 8-9 pipelines which are currently being discussed, apart from what have already been awarded.
So I think that shows a very strong visibility for the next 3-5 years' time. We are also seeing a lot of development now happening in carbon capture and hydrogen pipelines. Plus, the US offshore is also seeing a resurgence. So the domestic movement of oil and domestic movement of gas, the carbon capture, the hydrogen pipeline, and onshore resurgence, all in all, all the four boxes in which pipelines are being used are ticking, and we are seeing an upsurge into that. If we look at Saudi, the Saudi Aramco has increased its capex guidance to the range of almost $50 billion-$55 billion. They are also talking of major capital projects for pipelines which are going to come up. They happen to be the Jafurah gas project. We are also talking of Master Gas Phase 4.
We are also seeing that Saudi Aramco is increasing their gas production, and it is about to go to 11.8 BCF per day. From 11.8 BCF to 16.6 BCF per day, they are contemplating to put almost 4,000 kilometers of new pipelines. So with Saudi's 2030 vision for both onshore and offshore, it seems to be pretty much on track. And more importantly, Saudi also will also become a sort of a hub, not only for the domestic consumption, but also as an export hub to the international market. As you know, Welspun Corp is significantly expanding its footprint in the Saudi market by putting up a new LSAW mill out there, and the outlook, both domestic as well as exports, looks extremely, extremely encouraging. When we talk of Saudi, you also know that we are expanding in our DI pipes there.
We are putting up a greenfield capacity for DI Pipes, and the market is very buoyant. There is a lot of infrastructure development which is happening. The demand dynamics are very favorable. There are local capacity constraints. As I have said earlier, we are positioning ourselves for import substitution because two-thirds of the quantity which is coming at this point in time is coming through imports. Once our greenfield project starts producing, the first thing which will probably happen is all the import substitution will stop. We will have a natural platter to play with. We are also pleased to report that the government of the Kingdom of Saudi Arabia has also started some anti-dumping duty investigations for all the cheap imports which are coming. I think that will also help in settling down our new DI Pipes plant much faster with better margins and realization.
Apart from that, we are also seeing that there will be a huge reconstruction activity which will come up into the neighboring countries around Saudi. The Saudi government has pledged a significant amount of money for their reconstruction in Syria and all the other neighboring countries, and we feel that that will also be a great opportunity for our ductile iron pipe business. So all in all, Saudi, we feel very confident that the investments what we have made in our longitudinal plant and the DI plant is definitely bound to give us the benefits of the positioning being out there. As regards India, the India domestic market has been slightly tepid. We have seen in the last few quarters the water sector being down and the oil and gas sector also not coming up to the scale. But the export market has been extremely good.
We are seeing multiple projects in Qatar, Australia, and Latin America, and some part in North America where we can supply out of India. So those projects, we are seeing a surge in those types of projects, which means the global demand, the global appetite for LNGs and the gas transportation is extremely high. And we see that India, we will continue to focus more on the export side of it. Recently, you would have also seen that we got a breakthrough in the Latin American market, in the Argentine market. It was a very competitive market. And because of our quality and because of our technical superiority, we were able to position ourselves into that particular market. And that export will also happen out of India.
We are also seeing hydrogen and carbon capture pipelines, and we also are dissecting the recent budget which our Honorable Finance Minister presented. I think there was a reference for a lot of infrastructure development for carbon capture. So all in all, WCL India, the Welspun Corp, India offers a sort of a very unique proposition. So we can produce pipe, we can do all types of coatings, we give all types of bends. We have a strong R&D network, we have an excellent customer base, and we have a very, very time-tested, proven supply chain that positions us very nicely into the global market. In that domestic oil and gas market, as I said, it has been slightly tepid, but looks like that they are going to - it is going to come up.
We expect to see that with the LNG prices now moderating, we see a lot of LNG coming into India. Corresponding to that, we will see a network getting created. We are also seeing—we are also seeing that GAIL is about to invest almost INR 2,000 crore-INR 3,000 crore in FY2026 for pipeline infrastructure, including BPCL, is also putting up an infrastructure for refineries and petrochem. The LNG capacity is bound to grow from 52 million tons, which is currently handled at eight terminals, to almost 86 million tons per annum, which is by 13 terminals. So effectively, five more terminals, LNG terminals, are going to come up. The CGD network, now when the prices are moderate, I think the CGD network is also bound to grow. We are seeing a total investment of close to INR 40,000 crore happening till 2034 in the CGD network.
So the domestic part of the oil and gas business also seems extremely promising in days, months, and years to come. As I said, the water has taken a little bit of a hit in the last two quarters. It was all because water is all driven by the government funding. But now we are seeing a complete resurgence of that. We are seeing this interlinking of rivers. We are also seeing the budgetary allocations which were announced yesterday for Jal Jeevan Mission. All these projects now seem to be coming up on track. And I am sure the benefit of that, we will start seeing it in the coming financial year. So both water as well as oil and gas in the domestic market is only going to improve from here in days and weeks and quarters to come.
As regards to DI pipe, we noticed that the JJM has been extended to 2028, which may translate into consistent consumption of DI pipes. The same is also coupled with AMRUT II, which is the urban requirement and which will boost the demand. Thirdly, the irrigation projects are likely to come up in a big way with a special focus on HAM projects. The new requirement is also coming up in the sewerage sector with different types of coatings. We are seeing some very key projects which are going to come up, which is like Marathwada Grid, CIDCO, ERCP, PKC, Ken- Betwa, etc. These projects are expected to bring a significant quantity and will have significant requirements for the ductile iron pipes.
One of our thrust areas is also exports, and we have already started exporting to Europe, Middle East, and Africa, and because of the approvals and negotiations with Welspun India. Of late, in the last, we have seen some fund crunch under JJM, but yesterday, the Honorable Finance Minister announced almost INR 70,000 allocation to JJM. Once that happens, and I'm sure the moment that starts trickling in, which would be in the very first quarter of the next year, I think we will see a complete resurgence of the projects which have gone slightly slow in the last two quarters. So here on, I see a great momentum coming up in the DI sector, both in the domestic as well as into the international market as well.
On the SS bars and pipes, our focus has. Government of India's focus has been on the energy, defense, space, oil and gas, petrochemicals, engineering, and public infrastructure. That is what the Government of India has been focusing upon. They have been focusing upon Atmanirbhar Bharat. There have been a lot of ecosystems which have been created where they have put in anti-dumping duties and protective environments for the stainless steel pipes and bars. On top of it, we have also been able to sign. The government has been signing FTAs with multiple countries, including Europe, which is a big market for us. So all in all, put together, as WSSL specifically is still being a fully integrated steel company, we will be able to leverage not only the domestic market but also benefit under the FTA in days to come.
As regards to Sintex, if you see Sintex, we have been absolutely. Sintex has two components. One is the tank component and another is the pipe component. In the tank component, we have been absolutely steadily making our progress into the markets. We are regaining our market share, which we have lost over a period of time. We have been regaining it absolutely in a very, very systematic manner. The product acceptance, the brand recall is extremely, extremely high. On the pipe side of it, which is where the TAM, the Total Addressable Market, is significant, we have started our journey with the OPVC pipe. We have now the approvals and the empanelments in the states which matter the most to us. And we have only had the breakthrough of the orders. The orders have, and we have already started executing the orders.
And now we will see with this empanelment and accreditations happening for the OPVC pipe, we are going to see a big momentum coming up into the Sintex market as well. As regards to the projects, as I said in our Q2 presentation, we did indicate that all the projects which are going on, I am very happy and pleased to report that all the projects which we have initiated are moving on track, which is about our project, LSAW project in America, our ERW project in America, our DI project in Saudi, our LSAW project in Saudi, and two or three projects which we are doing in India. So a list of seven or eight projects which we have shared with you in Q2, they are absolutely moving on track.
We are seeing that once—and they will start coming on track, let's say, from the—let's say, the second quarter of this financial year. In a progressive manner, from June onwards, all these projects will start coming into operations and going up to December of 2026. In quarter, let's say from quarter two to between quarter two and quarter four, all the projects which we have embarked upon will all be delivered. Lastly, on sustainability, I am very happy to share that as per the latest S&P Global Corporate Sustainability Assessment, which is the DJSI Index, Welspun Corp is now ranked fifth globally and second in India among the steel companies in 2025. We have achieved an overall score of 78, making a 7% increase from our previous score.
So the consistent improvement in our scores and global ranking reflects the strength of our sustainability strategy and its execution. It is very, very close to our heart while we are growing the business, while we are moving into core products and core geographies. But sustainability is at the core of our heart. And this improvement in the scores of the DJSI Index and our ranking globally is a clear testimony to that. I think with this, I would like to take a pause here. And I would like to spend time with all of you if you have any questions and answers around that. Thank you.
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 the touch-tone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Sneha Talreja from Nuvama. Please go ahead.
Hi. Good afternoon, team. Congratulations and great set of numbers. Just a couple of questions from my end. Firstly, you mentioned that on budget, of course, there has been great announcement on JJM front. You also expect the movement to start from quarter one of this year. The question was, while last year also there were allotments made, but we did not see the spending coming in from government, what's the confidence that we have for this particular year that the amount which is budgeted would actually be spent?
Sneha, good afternoon. I think there is a difference between the last year and this year. I think last year they did make an announcement, but they were slow in terms of spending because they wanted to do a sort of auditing about the whole schemes around JJM. Apparently, it looks like that the audit stands completed. And that's the reason they have now made a subsequent announcement that they would be spending the INR 70,000 in the next financial year. So all what we are hearing is that the government is absolutely dedicated to complete all the projects which are already announced under JJM, Rural and AMRUT, which is the urban part of it. And we are very confident that this spending is going to come into play.
Mr. G, we also knew that there are some payments which are pending for the projects which are already completed. Have we seen signs of revival around for those funds getting released?
We have seen that, ma'am.
Understood. Secondly, on OPVC front, you said there have been developments. What I wanted to understand was, have we received a substantial order book? Or could you share some order book number with us on the OPVC front? I think, yeah, that's.
So, OPVC, again, this is OPVC is all about approvals, accreditations, and empanelment. Our focus has been largely around the Chhattisgarh area and the Madhya Pradesh area and the south. That is the corridor we are looking at at this point in time. I am very happy to, and it takes time. When your product comes into the market, the approval, accreditation, and empanelment process takes its own time because there's a lot of testings and everything which is required. And I am very happy and pleased to report that we have cleared all the major milestones in all the three markets at this point in time, which is our focus market: the southern market, the central market, and the eastern market. Now we are absolutely poised to grow from here.
Understood. So you mean you've got the project approvals in place, but order book now will build up?
We have an order book. We have some orders in hand at this point in time, but they are contingent to the approvals, right? Now we have the approvals in place. Now those orders will come into the execution mode. And then it will build up the momentum.
Understood. And lastly, while now it's very obvious that you are going to overachieve the guidance which was given for FY25 as a whole, any guidance that you would want to give for next year?
It's a little premature, Sneha. I think so. Typically, when we do our call for the Q4, that is the time we give the guidance for the next financial year. At this point in time, we are working on our annual business plans. But in the Q4, when we come for the call, we'll give you the guidance.
Sure. Sure. Thanks, sir, and all the very best, team.
Thank you, Sneha.
Thank you. The next question is from the line of Ashutosh Somani from JM Financial. Please go ahead.
Yeah. Yeah.
Sorry, Nirmala.
Thank you, sir.
Ladies and gentlemen.
Yeah, sorry.
Yes, yes, yes. Just a second, sir. Ladies and gentlemen, to ensure management can answer all questions, kindly limit your questions to two per participant. So you can please go ahead, Ashutosh.
Yeah. Yeah. Thank you. From a commentary team for the next 2-3 years' point of view, majority growth for the company would come from the exports market. So how do you see, firstly, the 50% penalty tariff impact on our business? What negatives does it entail for Welspun Corp?
Ashutosh, good afternoon. You're right. I think a significant growth will come from the export market. But you also have to understand, Ashutosh, that we are also a local player in most of the markets. Today, we are a local—we are going to be a local player in the Saudi market. And also, we are going to be a local player in the—we are already a local player in the US market. So tariff, per se, is something which is not impacting us, to be honest, because we are also a localized player.
The second part of the growth for India is for the export into the markets which are non-tariff markets. So India will focus on non-tariff markets. The tariff markets like America and Saudi Arabia, which are the largest consumption centers, we are now a local player. So the strategy of being a local and yet a global player, I think so, is panning out extremely well.
Thank you. And just to follow up on this, so what percentage of revenue from India factory is being sold to U.S. customers as of now?
Nothing. zero. We are not supplying anything. Yeah, we don't intend to do anything from India because we have a local presence on the ground. So there's no reason for us to do anything from India. And in any case, you cannot do that. The anti-dumping duties and countervailing duties are so very high that it is commercially unviable now. And more importantly, now when we are the local player, we don't, neither will we do it nor will we let it happen as well.
Okay. Yes, sir. And second question is on DI Pipes. Despite domestic constraint of growth, we have shown 39%, there is healthy volume growth. So just wanted to understand what has driven this growth, which market specifically? 39% volume growth?
Yeah. Yes. I mean, it is all about, it is all about the customer confidence and the trust they have in our serviceability and in our quality, despite that there has been a fund crunch into the DI market. But I think the order book, the strength of the order book, has been extremely robust. And we have seen this primarily coming from the west and the north market. We have a very, very loyal, strong customer base. And despite all the challenges, we have been able to tide through the tough times. And now when we feel that now in the subsequent quarter, things are going to ease out, we will see a further momentum coming up into DI Pipes.
Okay. Thank you. Just to follow up on this, for the DI pipe, 39% volume growth does not include the exports as of now. It's entirely domestic?
Export? No, no. There was some component of export, not a very large component of export because we have been tied up in servicing the domestic market. But at the same time, we have been building our infrastructure for the export that is absolutely now ready. And from subsequent quarters, you will start seeing an export percentage also coming into our DI Pipes sales.
Okay. And just to EBITDA per ton, if you could just tell for DI pipes what it has been in this quarter and past year for the sales?
I think so. I will ask Mr. Percy and all those people to get into those financial details maybe offline with you, and they can share because right now, all what I have is a consolidated number in front of me. If you want to see a product-wise EBITDA, I think Mr. Percy and team can help you offline, please. Will that be okay, Ashutosh?
Yes. No problem. Thanks a lot, sir.
Thank you. The next question is from the line of Sailesh Raja from B&K Securities. Please go ahead.
Yeah. Thank you. Congrats to you and your team, sir. So with respect to India business, our volume declined by 20% year-on-year, approximately 410,000 in the first nine months. So how do you see the volume trend shaping up over the next year? And also in the recent budget, if you see, the government has allotted only INR 1,900 crore for the river linking project. And same time, we have also got, as you mentioned, we have got exports order also in Argentina. And because of river linking only, we have created capacity in Bhopal. So how do you see that next year? What kind of growth do you see in India line pipe business?
We have to see the India line pipe business into two categories. One is for export, which is oil and gas. Second category is for export, which is also for oil and gas. Third is the domestic water. The domestic water has been low. As I said earlier also, the volumes have been lower. That is what is getting reflected in our volumes also because the fund allocation in the last two quarters in the water sector has been extremely low. There was a fund crunch which was in place. But now with that getting over, I am sure there will be a volume uptick which will come into the water sector domestic. If you see the export part of it, the export part of it has been absolutely consistent. Year-on-year, we are doing export of a particular volume.
That part of the business remains intact. The third part of the business is the domestic oil and gas, right? Domestic oil and gas, there were IOCL, EIL, and GAIL which are the primary buyers. I think so. They have been conceptualizing on some of the pipeline projects. I am happy to report that they have now been able to do that. We are seeing that they are about to invest a couple of the INR 3,000-5,000 crore in terms of developing that pipeline infrastructure. We see multiple projects coming up for bidding in the next financial year, which we will be, and I'm sure we will get a portion of that in any case.
Yeah. Hello.
Shilesh, did you hear me clearly? Hello?
The line from Shilesh has been dropped.
Okay. We'll move ahead.
Participants who wish to ask questions may press star and one on their touchtone telephone. The next question is from the line of Vikas Singh from ICICI Securities. Please go ahead.
Good afternoon, sir. Congratulations on a very good set of numbers. Sir, my first question pertains to our U.S. business. Have we already seen the quarterly-level peak volume which we can sell out from the U.S. business and their part of the EBITDA contribution in subsidiary? And that's why we are not increasing our guidance to that extent because domestic volumes would remain weaker for one more quarter.
Good afternoon, Vikas. I think so. First, to your question of U.S. business, see, U.S. business, we are whatever quarter-on-quarter production numbers and the guidance what we have given, we are absolutely on track with that, number one. So right now, what is operating is a spiral mill out there. What is going to change is that in subsequent quarters, let's say in one quarter down the line, we will have a new HFIW mill which will be there. And then two quarters down the line, by the end of this year, we would have our new LSAW mill coming out there. So those volumes will start ramping up in U.S. And then the numbers in U.S. will drastically change.
Right now, what you are seeing is all what you are seeing is the numbers of our order book which is out of our spiral mill and which has almost eight quarters of a clear order book till March of 2028. It is completely booked at this point in time.
Sir, just a clarification. Once our new spiral mill comes on board, can that spiral mill do some of the existing order book volume as well? Or the delivery schedule is set such a way that it won't be possible and we have to seek for the new orders from the US for the new spiral mill? How should we look at it?
Vikas, to correct, there is no new spiral mill coming up. It is a new longitudinal mill which is coming up. So there is already an existing spiral mill which already has an order book till March of 2028. So that is completely booked. What is coming new is a new longitudinal mill out there, LSAW mill, right? And to that also.
Also the HFIW, the HFIW capacity is also we are increasing the HFIW, which we follow.
Yes. Yes. Yes. So we already have an existing mill which is up to 20 inches. What we have done is we have now taken a new mill which is up to 24 inches mill. So there is nothing. So we are replacing the capacity from 20 inches to 24 inches. That's a replacement of the capacity which is happening out there. So which means that we will have much more play in a larger section of the market up to 24 inches, which is a big market. And there is a new LSAW mill which is going to come up by the end of this year. So these two mills put together will add up significantly to the existing volumes, what we are currently doing.
Noted. And sir, my second question pertains to DI business. So coking coal costs have run up quite significantly and more than, I said, 20%-25%. So does this kind of sharp cost is covered in our or we would have to take a hit for the higher coking coal prices in subsequent order until and unless we get the better pricing? So how should we look at it?
Okay. The way, Vikas, we have to see things, in any case, we always have a forward coverage of coal, of all the raw material for at least two quarters. So I am not expecting any hit whatsoever because of this coking coal increase which has recently happened. And there are reasons behind it, right? This coking coal increase is a sudden surge because of the force majeure the coal mines have announced because of the inclement weather out there.
Once we believe that once that element of force majeure settles down, the coking coal prices should get normalized. And when we get into the market for fresh buying, that point in time, we would see that the prices are moderated. And in any case, by that time, we will also have we will be booking up new orders. In any case, we would have factored for that. Currently, I am agnostic to any price increase because of the coking coal.
Noted, sir. That's all from my side. Thank you.
Thank you, Vikas.
Thank you. The next question is from the line of Sucrit Patil from ICICI Securities Private Limited. Please go ahead.
Good afternoon to the team. I have two questions. My first question to Mr. Mathur is, as Welspun continues to execute across energy and water infra projects, could you share how management is currently thinking about trade-offs between order book visibility, project complexity, and margin quality? What kind of changes in tender structures or customer behaviors would prompt you to recalibrate this pattern? Just want to understand your view on this.
So, your first question is on if Mr. Patil, if I understand you correctly, your first question is on the margins. The second part is about the tender strategies. That's what you meant?
More or less, how are you planning to decide about the trade-offs between book visibility, project complexity, and margin quality? A contingency plan if you have in mind. I just want to understand that particular thing.
Okay. So, Mr. Patil, we are A, there is enough business into the market, first and foremost, number one. I don't see that the demand uptick has stopped. What we are doing, we are very clear in terms of selecting and cherry-picking the projects on which we want to work around. So that gives us and we are a tier-one player. We operate on the top end of the pyramid. And that is where we will continue to play. So that gives me the niche. That gives me the visibility. And that gives me the margin. So that is our play right from day one. And this is what we will continue to do. So I think so, in days and times to come.
I think so, from a business perspective, we are seeing enough business into the global market and enough niche business into the global market which will keep us fairly occupied.
Thank you. My second question to Mr. Percy is, beyond the reported financial things, what are the key early indicators you monitor internally, such as milestone billing behavior, inventory cycles, or customer payment patterns for anything that you particularly observe that helps you assess the cash flow and execution risk before these show up on your numbers?
Yeah. So Mr. Patil, Welspun Corp is extremely focused on the capital allocation policy. So when we are talking about our projects and capital expenditure, a lot of planning goes into that, as well as the working capital management. So we prioritize a lot on monitoring the inventory levels, on the receivables, and on all the creditors' payments as well. So that's what finally shows up as an improvement in our ROCE, our return on capital employed. So balance sheet health is even a very high priority in addition to the business performance, the order book, and the profit margins. I hope that answers.
Yeah. Thank you. Best of luck for the next quarter.
Thank you.
Thank you. Participants who wish to ask a question may press star and one on their touch-tone telephone. The next question is from the line of Karan Bhatelia from MAIQ Capital. Please go ahead.
Hi. Good afternoon, sir. Congratulations for the numbers. Now, my question to you was regarding the order book. So could you provide a timeline or a phased plan for clearing the INR 23,600 crore order book over what period?
Yeah. Currently, for U.S., I think so, the order book is right up to March of 2028, right? And in India, we have a clear order book of almost in India, line pipe business, I'm talking, we have an order book of in the oil and gas side of it of close to 9 months to 1 year at this point in time. On the DIP side of it, if you look, we have a bending order book of close to 300 or 1,000 tons, which gives us a clear visibility of 700.
Sir, I'm sorry. Your voice is cutting. Can you repeat, please?
I'm saying for the US, we have a clear. Can you hear me? For the U.S., as I said, we have a clear order book till March of 2028.
Right. And India, DI Pipes is also one year.
DI Pipes is also close to three-quarters.
Three quarters. Got it. Sir, my second question would be regarding the U.S. business. Given the revenue decline in FY25 for the U.S. operations, what specific revenue figure or maybe the utilization rate, if you can share, for FY26?
I don't know why you are referring to a revenue decline in U.S. How did you deduce that, please?
Question?
How did you?
For the.
Why did you say there's a revenue decline?
For previous year, I mean, compared to FY25.
You understand revenue. Record of the mill. There has been a volatility in the raw material prices globally. So, Percy, maybe I do not declare from the top of my head what revenue decline in U.S., my sense. Not give, but nevertheless.
Yeah. So I'll just come in. I'll just come in over here. So I think.
Of course.
Karan, your question is probably pertaining to the previous year. So the U.S. scenario started changing dramatically sometime from September 2024 onwards when we started getting a strong order book visibility. So if you are referring to the previous year, then, of course, at that time, the order book was not there in the U.S. But after that, of course, it's a very strong bullish scenario that we have with the focus on oil and gas, fossil fuels, and also, of course, the new administration that took charge from somewhere around December 2024 onwards. So I think your question must have been for the previous year. This year, of course, we have a very strong visibility.
Yeah. I mean, comparing correctly, from the previous year to current year, considering what would be the utilization rate we are expecting for current year, FY26?
So FY26, we are, of course. Sorry, go ahead, sir.
Yeah. Yeah. Karan?
Yes.
Which is currently into operations, will be close almost 85% capacity utilization. It will.
Sir, I'm sorry. Your voice is cracking. I couldn't hear.
Almost 85%-90% capacity utilization will be there for our spiral mill which is currently operating in U.S.
Got it, sir. Thank you and all the best.
Thank you. The next question is from the line of Radha from B&K Securities. Please go ahead.
Hi, sir. Thank you for the opportunity. Sir, by when do you expect the anti-dumping measures against Chinese players to be implemented in Saudi? And how much incremental DI pipe market could this potentially open up for us?
Radha, good afternoon. I think so. The investigation has started. Probably, it is a process. It takes its own time. It is not about China. It is about imports from wherever the imports are coming. I think so. It is a very wide-ranging investigation which seems to be happening. Maybe it might take one or two quarters. Probably, that's my guess. We have to understand the whole process. That's my best guesses. Today, almost two-thirds of the DI pipes was coming as an import. Only one-third of the total requirement of the Saudi market was being serviced by the local players. We see a great opportunity once this anti-dumping investigation happens and once our mill comes into play. I think so. This is the two-thirds market which is coming, which we will be able to service that.
Investigation is happening against India also, sir?
I'm sorry?
Is it happening against India also, the investigation?
See, right now, it is fairly broad-based at this point in time. It is not country-specific. It is import-specific that there is an import which is happening and that need to be curtailed. And they need to work out a sort of a policy or regulation.
Secondly, in the overseas market, could you elaborate on the progress in obtaining customer accreditations for DI pipes? How large could this opportunity be over the medium term? And additionally, with combined India and Saudi DI capacity reaching 950,000 tons by 1H FY27, how long do you think it will take to ramp up until this capacity on a conservative basis?
So on the overseas market, I think so. We have been focusing on the European market for our DI pipes. And the acceptability of the pipes, we have already done some sizable amount of quantity into the European market. And the response has been overwhelming. I'm sure that over it will grow, number one. Number two, the Middle East market is our focus. So this is how we are developing funding based on the export side of it. Looks like, and once the Saudi capacity will come up, I think so, that will primarily be focused on the domestic requirement to start with. And also, the reconstruction activity where Saudi government will fund.
Our focus will be from the Saudi market, will be local and the projects which the Saudi government is funding in the reconstruction of in the neighboring market and all the other markets we intend to service out of India.
Any color on the customer accreditations from the DI Saudi plans?
See, you only have basically, you have one approval there, which is the NWC approval, which in any case, as Welspun, we only have it. So then it is a matter of going to all the contractors who are executing the projects. All the Welspun Corp, as an organization, has it.
Okay, sir. Thank you and all the best.
Thank you.
Thank you. The next question is from the line of Sohan Joshi from ASC Consultancy. Please go ahead.
Good afternoon, sir. Am I audible?
Sir, there is a lot of background disturbance from your end.
Now, is it audible? Hello?
Yes. Yes. You're audible.
Yes, Sohan. Good.
Great execution, sir. So one question. I'm sorry if I might have missed because I joined recently. What will be the impact of the rising metal prices, especially with regard to steel and aluminum going ahead? I mean, are the entire booking terms done for the orders to be executed for the next two, three quarters?
The policy will be raw material booked. Raw material is a past. We completely cover material. So at this point in time.
Sir.
Whatsoever.
Government announced nuclear energy. Am I audible? Hello? Hello? Am I audible?
Yeah. Go ahead, sir.
Yeah. So in the budget, the government announced the data center nuclear energy. What are the opportunities similar to the U.S. we are finding now, even in India?
We have to these announcements are very encouraging announcements. There have been such announcements and such things have been a major catalyst in the US market. We believe that these announcements by government will also be a catalyst in the domestic market. We see opportunities coming up, especially more in our WSSL part of our business where we are the seamless steel pipes and very high-quality seamless steel tubes are to be supplied. So we are seeing that there could be a great opportunity from a WSSL perspective. Rest, we have to see what type of infrastructure they are going to create. I think so. It's a matter of time. But definitely, WSSL will be one of the major beneficiaries out of this.
Okay. Sir, one last question, if may I ask?
Yeah, please.
Yeah. Sir, there are a lot of damages being done to the Russian refineries, I mean, even recently, in the past few months in the war going on. So how are we looking at those opportunities? Don't you think that we have a good opportunity if the Russians go to do some CapEx for the damaged refineries? We have good business opportunities over there as well. Are we planning to tap something of those opportunities?
Sohan, we have not focused on that yet. We have not explored that as yet. I think so. We will have to see the Government of India policy around that. Right now, the honest answer is that we have not evaluated that.
Okay. Okay. Thanks a lot, sir. That's it from my side.
Thank you.
Thank you. The next question is from the line of Yash from ART Ventures. Please go ahead. Sir, Yash, kindly unmute your mic.
Yeah. Am I audible?
Yes, sir. You are audible.
Yeah, sir. I just wanted to know, what was the revenue for Sintex during the quarter end for 9 months FY26?
Yes, sir. Sorry, can you repeat?
Yeah. So what was the revenue for Sintex during the quarter end for 9 months FY26?
Percy, would you take this, please?
Yeah. So, Yash, Sintex has been keeping on an even keel and their water storage tanks, and they have been improving their market share. Approximately, for the nine months number, they should be closer to about INR 500 crore. I don't have the exact number in front of me, but they should be close to about INR 500 crore.
Okay. Thank you.
Thank you. The last question is from the line of Ashutosh Somani from JM Financial Family Office. Please go ahead.
Yeah. Thanks for the opportunity, sir. So I had one question. You mentioned we are replacing the 20-inch diameter in the HFIW mill in USA to 24-inch. So just wanted to understand what is the rationale behind it? And secondly, how is the competition in the USA for the two product categories that we are entering, HFIW and LSAW mill? And what is the revenue potential from those beats and CapEx and ROC? Yeah. So this was not one question. You loaded too many questions in the same. But nevertheless, let me answer. Right? So see, what we were in our HFIW mill, we were currently having a capacity up to capability up to 20-inch. We are seeing a lot of NGL, which is the natural gas liquids, transportation which is going to happen in America.
Typically, natural gas liquids, when you are drilling, you are extracting oil, you are extracting gas, there is some gas which is also coming in a liquefied form. Now, that is a very premium product, and that requires transportation. We are seeing that for transporting that, there is a 24-inch pipeline is the most optimal suited pipeline diameter for that. We were not in a position we were not in that area because we were limiting ourselves to 20-inch. So we were losing out on a business opportunity for 24-inch, which is very, very sizable. So that is the reason we took that call that as we are a large player in the American market, we have to have a complete range. And that is the reason we are enhancing our capability from 20-inch to 24-inch. That's the first part of the answer.
The second part of the answer is about LSAW. Once our capacity will come up, there will only be two players in the American market. One would be Welspun, and the other is on the west coast of America. So there will be two LSAW players. And looks like the demand, as I said earlier in my call, the demand seems to be coming up significantly for the carbon pipeline where very heavy wall thick pipes are required. We are also seeing a resurgence in the US offshore market. A lot of offshore projects are being announced. So we see that in the next few years, it's going to be very, very dominant demand for the LSAW products as well. And thirdly, there will be no import restrictions. So there will be a clear-cut import restriction.
So there will be no imports coming into that particular market as they are not coming into the spiral. Okay, sir. And this is the last part. What you told about import was. I'm saying that once you have the domestic mill operating out there, then it completely neutralizes.
Okay. It neutralizes the imports, whatever is happening currently. Currently, it's net imports still.
Got it.
Okay. Got it.
Correct. That's it.
Sir, CapEx and ROCE profile of those two factories, of those two mills?
See, see, at the end, when we made a capital allocation to that, we were very, very clear that it has to be at a particular threshold of ROCEs have to come in. And our ROCEs are close to around 20-odd% ROCE. That's what we were talking about. And these are our internal threshold limits for approval. We are sure that we should be able to achieve that.
Okay. Yeah. Thank you.
Thank you very much.
Thank you, ladies and gentlemen. In the interest of time, that was the last question. I would now like to hand the conference over to the management for the closing comments.
Thank you very much, gentlemen, all of you, for taking time out today and joining our call today afternoon. We greatly appreciate your interest in our company. As you know, we have been absolutely making all the strategic steps in the right direction, which is going to build this company and which will take this company to absolutely a next level of earnings and profitability in times to come. I think so. As our projects are going to get completed over the next few quarters, two or three quarters at best, the incremental earnings are going to be sizable. So there is a huge growth potential, one. The second part of it, we are emphasizing that there is enough market which is available. So both the market and our positioning into the market is going to give a new color and new flavor to Welspun Corp.
Lastly, I would like to say that if there are any other questions, which we have sincerely tried our best to answer all of your questions. But in case, if you think that anything has been missed out, please feel free to reach out to me and to Mr. Percy or to Goutam. They will be more than happy to answer any clarifications or follow-up questions you might have. Thank you very much once again for joining us today. All the very best. Good day.
Thank you. On behalf of JM Financial Institutional Securities Limited, that concludes this conference. Thank you for joining us. You may now disconnect your lines.