Ladies and gentlemen, good day and welcome to Bansal Wire Limited Q2 FY26 Earnings Call. As a reminder, all participants' 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 Parthiv Jhonsa. Thank you, and over to you.
Thank you, Heena. Good evening, everyone. Belated Happy Diwali and Happy New Year to everyone who's joining the call. We at Anand Rathi are pleased to host Bansal Wire Industries Limited Q2 FY26 Earnings Conference Call. From the company, we have with us Mr. Pranav Bansal, Managing Director and CEO, and Mr. Ghanshyam Gujrati , CFO. We would now like to invite the management for the opening remarks, which will then be followed by a question-and-answer session. Thank you, and over to you, sir.
Thank you, Parthiv. Good evening, everyone. I welcome you all to our Q2 and H1 FY26 earnings call. I trust you've had the opportunity to review the results, earnings and press releases that are available on the exchanges and on the website. I hope you guys had a good Diwali. Now, we're pleased to report another resilient quarter. This also marks our fifth consecutive quarter of delivering higher revenues, volume, and EBITDA after getting listed. Despite the challenging business environment on account of heavy monsoon and labor shortages, we were able to do our highest-ever revenue, volume, and EBITDA. This consistency in performance reflects our disciplined execution and our ability to respond effectively to evolving market dynamics.
But more than this, I would say it was a defining first half for everyone at Bansal Wire Industries as we shifted our focus completely towards cash flow positivity and moving towards higher ROCE. Now, to do this, we reevaluated every business decision we were taking and recalibrated a lot of lower ROCE investments and, in fact, doubled down on our core business because, of course, that's what we do best. We made a lot of changes in the way we work to create a more sustainable growth model and have set a target for ourselves to achieve 25% ROCE by 2027 and INR 600 crore plus of positive cash flow within this year and next year combined. Of this, the first step we have already taken this first half by realizing almost INR 150 crores of free cash flow from operations.
And by doing this, we will create a self-sustaining model by reinvesting free cash to meet our growth requirements and reduce our dependency on the market. Apart from this, we've also performed on three fronts which will have a major effect on our future growth. First is that we've made significant progress on steel cord as we have received two sample approvals already from major tire companies. The next phase of approval has also started, and we remain on track to commercialize our product by mid of next year. Second is that we were able to penetrate in the B2C segment of our industry, which also contributed already 5% of our total revenue this quarter.
This is a product on which we have been working for the last five years, and not only did it contribute in volume, but in fact, we were able to fetch better margins in this product than our B2B segment. We are quite confident that this segment will grow and contribute meaningfully in the coming years. Third is the introduction of our induction hardened and tempered wire as part of our specialty wire division with a capacity of about 9,000 tons annually. These wires are widely used for manufacturing high-performance springs in automotive components such as suspension and valve springs. The introduction of this product marks another important milestone in our specialty wire journey, further strengthening our presence in the automotive value chain and expanding our high value-added product portfolio.
We have already received encouraging responses from our customers, and we expect commercialization of this product within the second half of this year. Now, for the second half of the year, the domestic economic environment continues to be highly supportive of the steel wire industry. Strong demand from infrastructure, automotive, and industrial sectors, coupled with India's expanding manufacturing footprint, has provided sustained volume and pricing tailwinds. Bansal Wire remains strategically positioned to capture these opportunities through our broad product base and nationwide distribution reach. Therefore, we are confident that we will be able to achieve better numbers than our guidance in Q1. We are now looking at about 30%-40% volume growth within this year and more than 20% EBITDA growth as well.
Another positive I would like to highlight is that our Dadri facility is also now finally stabilizing and continues to operate effectively, supporting higher volumes. During the quarter, total sales volume from Dadri has increased almost 50% as compared to Q1. As of September 25, our total installed capacity stands at 420,000 tons at Dadri and 618,000 tons overall. Our capacity utilization for the quarter stood at 74%, demonstrating strong operational execution and consistent demand momentum across segments. Our long-term thought process to grow at 20%-25% every year remains intact, but now we have a target of better ROCE and cash flows with it. That's all from my side. I would like to now hand over the call to our CFO, Mr. Ghanshyam Gujrati .
Thank you, Pranav sir, and good evening, everyone. I will now take you through the key financial highlights for Q2 and H1 FY26. For Q2 FY26, our revenue is stood at INR 1055 crores, representing a 27% growth year-on-year basis. EBITDA increased by 20% year-on-year to INR 81.58 crores, while the PAT for the quarter stood at INR 38.3 crores. That was down by 4.3% year-on-year basis due to our higher capitalization, but our cash profit for the quarter rose 70% to 18% year-on-year to INR 56 crores. For the first half of FY26, the revenue grew by 21% year-on-year to INR 1994 crores, while the EBITDA came in at INR 156 crores, an increase of 19.7% year-on-year basis. Net profit for H1 is stood at INR 77.6 crores, higher by 8.4% on year-on-year basis. Our cash profit for H1 rose by 24% to INR 106 crores.
As Pranav sir has already mentioned, our volume was the highest ever for the quarter, and it was 1.14 lakh tons as compared to 104,000 tons in the quarter one of FY26. Exports contributed around 9.1% to the overall revenue. That concludes my remarks. We will now open the floor for the questions. 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 their touch-tone telephone. If you wish to withdraw yourself from the question queue, you may press star and two. Participants are requested to use handset 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 Pratik Singh from DAM Capital. Please go ahead.
Hey, hi. Thanks for the opportunity, and congrats for a decent set of numbers. The first question is largely a bit more detail if you can give on the steel cord approvals? So when we say we got approvals for some samples, does it mean that some clients have reported that they are okay with it, and they will check it again in a subsequent sample? Or is it like some clients have okayed and some other clients left to okay it? How does it work here?
Sure. Hi, Pratik. So the approval process of steel cord is generally in two phases. First is basically a lab approval or a sample approval, wherein we send a sample to the customer. They do extensive testing in their lab, understand all parameters, and then they say that whether they can move ahead or not. Second stage is once they have approved the lab samples, then they go for field trial. Field trial means they will make a tire out of it. They will run the tire for the entire lifespan of a tire, generally 25,000 kilometers. And then once that is there, they will go in for bulk quantities. So right now, we have been discussing with three major tire companies, out of which two tire companies we have already received the sample approvals. The third company is still evaluating our samples.
Now, when I say we have received two sample approvals, that means we have already passed the first stage of testing, and now we have entered the second stage of testing, wherein we will supply them some quantities for making their tires and then doing a field trial on the product.
Thanks, Pranav. As a follow-up here, so how long will this second phase take usually? One year or so?
So generally, a field trial takes about seven to eight months. But all of that, again, depends on various different factors, whether they run it on a commercial vehicle. Commercial vehicle, the lifespan is quicker. Passenger vehicle, the lifespan can be a little longer, whether they run it on a taxi or a private vehicle. So all of those factors are there. But in general, yes, about seven to eight months is what it generally takes. That's why we feel that we are a little advanced on the first stage. And we have, I mean, as per our earlier understanding, also we were looking at commercializing the product by mid of next year. And so we think that we are a little ahead of that as of now.
Understood. My second question is largely on numbers. So when I drill down a bit more on numbers, it seems that our selling price actually has gone up on a quarter-on-quarter basis. So basically, gross margins as well have gone up, but the EBITDA fall that we are seeing is largely driven by employee costs and other expenses. Employee costs have gone up by around INR 500 per ton and other expenses by INR 15 per ton. So to get a sense, what exactly so other expenses, as I understand, is largely job work charges, freight, and power and fuel. Any of these things rose up very sharply this quarter, which might be a one-off? And what about employee costs? Do we think that this employee cost is stable, given that we might have advanced hiring capacities?
Sure. So employee costs have definitely gone up, but that is more or less in proportion with the sale quantity as well. Overall, I think in a broader understanding, our EBITDA per ton has been quite consistent. We were looking at EBITDA to go down below 7,000 level, but that has not happened, or we do not see that happening very soon because we've been able to get a lot of premiumization on our products throughout the quarter. We have taken some tough calls wherein we felt that we can increase some margins in some products, and we felt that there are products wherein there is no replacement of Bansal Wire today. So that was a call that we have taken, and that has progressed well. That has given us good return, which is the reason why we do not see a big decline in EBITDA per ton.
Employee cost is the only thing that has substantially gone up, and this, I think, will continue to maybe even go further as and when the volume increases.
Understood. Thanks a lot, Pranav, and the best. Enjoy, Bansal Wire Industries.
Thank you. The next question comes from the line of Aditya Bhartia from Investec. Please go ahead.
Hi, Pranav. Good evening. My first question is on backward integration for stainless steel rods. I think that is something that you are not intending to go ahead with. If you could just kind of explain what is the rationale for that, and with that not happening, how are the CapEx numbers likely to shape up over the next two years?
Sure, so as I said a little bit briefly on my note as well, we have recalibrated a lot of investment decisions, all based on the thought process that we want to have positive cash flow to a tune of about INR 600 crores this year and next year, and with that, we've also set a target of 25% ROCE for ourselves by next year. To do this, when we looked at backward- integration as an investment, we felt that that was an investment wherein, first, of course, both of these numbers were not happening. Second, we were also kind of moving away from our core competency or the core business to a very non-core and a different kind of a business.
Therefore, when we re-looked at all our business decisions, I think the leadership team decided that it is best for us to right now double down on our core business. That's what we have been doing for the last 85 years. We see a lot of potential in our existing business to grow at 20%-25%. Now with specialty- wire adding up, I think we can grow, or there are opportunities for us to grow even higher. With that being said, I think because of backward- integration not happening in the near future, we are not looking at any major CapEx or finance costs coming on our balance sheet anymore because to grow at 20%-25% in our current business portfolio, we need about INR 150-250 crore of investment every year, which we will be able to comfortably do from our cash flows itself.
Earlier, wherein we were leveraging our balance sheet, now we are looking at, if not reducing our debt, at least not increasing it further.
Perfect. That's great to hear, Pranav. My second question is that earlier we were fearing that EBITDA- per- ton can go down significantly from here on. And in fact, you had spoken about maybe EBITDA growth this year being only around 10%. Now we are sounding a lot more confident in terms of profitability and in terms of growth. So what really has changed? Is it just the change in strategy and therefore you thinking about focusing a little more on profitable products, or is there some change in the macro-economic conditions as well?
Well, I think the first thing is, of course, whenever we try to commit a number, we try to be a little more conservative because I don't want to take any pressure on our current structure to deliver something that we promise. So of course, there is definitely always room there. But other than that, I think what has also happened in the first half of this year itself is that we've shifted a lot of our focus to profitable businesses. When we again worked on ROCE, we also re-looked at a lot of products that we were making. We increased sales in B2C, which has given us better ROCE, better EBITDA- per- ton. We've increased our sales in other B2B, but higher ROCE businesses also. In fact, for example, our low- carbon wire vertical, we were not expecting that to grow at the same pace as the company is.
We were expecting more of high- carbon and stainless steel to grow. But when we looked at ROCE, we felt that low carbon business is where we get the maximum ROCE. It might be a little lower EBITDA- per- ton, but our return ratios are the best there. Plus, the B2C angle has also come in from the low- carbon wire business, wherein we are able to fetch a reasonable premium from the market. So I think overall, it's a bit of our thought process moving towards ROCE and better profitable businesses, but also just being a little conservative as well on the numbers when I compute some things.
Understood. And Pranav, when we speak about roughly 70% capacity- utilization, and as this capacity- utilization ramps up over the next few quarters, should we be assuming some operating- leverage gains as well? Is that something that should be bringing in much better profitability also? And a related question is that when you speak about 20%-25% growth, are you speaking about revenue growth or EBITDA growth? How should we kind of think about that?
Sure. So of course, as and when we grow in volumes, there will be a bit of operating- leverage that we will have. But I do not want to actually comment or increase my volume or EBITDA estimates because of this because there might be some uncertainties in demand or margins that we have to clear out. So I think EBITDA- per- ton, we would still want it to remain constant. But of course, going forward, I think due to the product- mix also evolving, we will be bringing in higher EBITDA businesses through specialty- wire. That will definitely gradually take my EBITDA- per- ton to an increasing trend from next year. And of course, this year, I think we have done most of the rationalization that we had to do in product- mix.
From here on, the 20%-25% growth that we are looking at would both be in revenue as well as absolute EBITDA.
Understood. And for next year, specifically, once specialty- wire kicks in, steel- cords kick in, then should the EBITDA growth be stronger than that? If revenue growth is 20%-25%, then I assume EBITDA growth should be stronger. Or the other way to think about it is that if EBITDA grows to 20%-25%.
Sorry to interrupt. Mr. Yash Sharma, sorry to interrupt. As we have to ensure that the management is able to address questions from all the participants, we need to move on. You can come back in the queue, and you can ask your question again later. So a reminder to all the participants, please restrict yourselves to two questions. The next question comes from the line of Aditya Bhartia. Okay. So there is a connection problem from Mr. Aditya. We move on to the next. The next question comes from the line of Yash Sharma from Veritas Research & Advisors. Please go ahead.
Yeah. Hi, hope I'm audible. And thanks for the opportunity. So I just have a bookkeeping question, Pranav. So see, there is a strong growth in the revenue and the volume side, but the same is not reflecting into the profitability, which is bad. So is that because of the line- items like interest or depreciation, right? And we are also seeing that debt actually has gone up during the quarter too from the last quarter same year. So does there any technical reason like the lower realization that we are?
Sure. So first thing is the debt level. It has actually reduced from last year, although it is not a big difference, but yes, it has not increased. That's one. But second, yes, of course, our profitability or PAT is not showing the same kind of growth as our revenue and EBITDA is, majorly because of depreciation and some interest costs that we were earlier capitalizing of Dadri. Now 100% of investments in Dadri has now been capitalized. Therefore, we see some increase there. Depreciation, of course, has increased by almost three times. But to understand it better again, we have also this time shown a cash- profit number because as a company, we will keep on investing, and our depreciation might increase. But at the end of the day, my cash- profit is still increasing.
In fact, even this year or this quarter, our cash- profit has increased by about 20%. 17% to be exact, to 56 crores.
And the second question: give us some color on the market share from last year to this year, if you could, and the segment-wise volume growth trajectory, especially on the specialty- wire side.
Sure. So I will not have market share numbers offhand, but yes, I think as a whole, what we can understand is the market was about 7 lakh tonnes this year, and if everything goes well, we should be able to do about 4 lakh tonnes, 4.2 lakh tonnes, about 30% growth, so maybe 4.5 lakh tonnes or something like that, so we would have about 7%-8% market share in general. This is our understanding, but again, these are not the exact numbers. In terms of volume mix, I think the first two quarters, we have done a substantial change in the volume- mix already as compared to last year. That is why there is a recalibration in the EBITDA- per- ton levels. Again, product-wise, EBITDA has not gone down. It is only the product- mix that has changed the number.
Going forward, I feel that our specialty wire vertical will start to contribute from the second half of next year. Therefore, our total product- mix will get healthier as higher profit business will start on increasing. In specialty- wire business, we have already started 20,000 tons of steel- cords. That was the first CapEx. And last quarter, we have done 9,000 tons of IHT wires. So we've already done 29,000 tonnes, or we've built a capacity of 29,000 tons to service a market of more than 3 lakh tons. Therefore, in the coming years, we'll definitely be banking on specialty- wire to a large extent to give us or to contribute higher in EBITDA.
Okay. Yeah. Thanks, thank you. That's it from my side.
Thank you. The next question comes from the line of Prakash from Anand Rathi. Please go ahead.
Hi Pranav. Good evening. My first question is over blended EBITDA- per- ton, which is somewhere around INR 6,700, and what is the target you are targeting for this year and FY 27 and FY28?
Sure, sir. So for EBITDA- per- ton, this quarter is about INR 7,100, not in the INR 6,000 level. That is one. Second, towards the start of the year in Q1, we were expecting the EBITDA- per- ton level to go down because we thought that there will be a substantial change in product- mix. But that has not happened, nor have we had to pass on any margins to the customer to grab a higher market share. When we actually worked on it, we realized that there were a lot of areas in which Bansal Wire was just not replaceable. So even after increasing our margins in a lot of businesses, we were still able to grow at a certain level of volume. In fact, from our earlier guidance, we have already grown at about 40% in first- half in volume while keeping our EBITDA- per- ton product-wise intact.
In the future also, we would be looking at similar kind of levels. We do not see any increase in margins going forward, even after increasing our volume by 20%-25% every year. In fact, with specialty- wire coming in the picture from next year, EBITDA- per- ton levels after that should only start increasing.
Okay. And my second question is over. As you said, you are recalibrating the business model. What is the expected installed capacity across high carbon, low carbon, specialty, and stainless?
Sir, our total installed- capacity is 6.2 lakh tonnes. This is with 60,000 tonnes of addition that we have done last quarter. One addition of another 60,000 tonnes is already underway, which will be completed within this quarter, taking our installed capacity to almost 6.8 lakh tons. As a company, we would want to operate at 80%-85% kind of a capacity utilization. That's the sweet spot for us. But of course, because we want to keep on doing at 20%-25%, we want to keep some headroom every year through investing in various products.
Also, I just wanted to know over the break-up of capacity between high carbon, low carbon, specialty, and stainless.
Sir, although most of our products are fungible, but just to give you a basic color on capacity, in a broad way, 60% of our total is what we want as low- carbon wires, and about 25% is high- carbon, and 15% is stainless. That's in a very broad perspective, but it keeps on changing a little bit depending on the demand- side.
Okay. And just one more question. What is the average EBITDA- per- ton across bead- wire, steel- cord, and IHT?
Sir, for Specialty Wire, as a business, we would want to look at about 20%-25% EBITDA. It might change between IHT and Steel Cord, but as a business, we would want 20%-25% kind of EBITDA in specialty-w ire. This does not include bead-w ire. Bead-w ire is a part of our high-c arbon wire product portfolio, which has the same kind of EBITDA as other high-c arbon wires we have.
Okay. Thank you, sir. Thank you.
Thank you. The next question comes from the line of Akash from Dalal & Broacha. Please go ahead.
Yeah. Thanks for the opportunity. Pranav, actually, I wanted to understand since we have backtracked on the Sanand CapEx for stainless- steel backward integration. So we have completely canceled out that plan, right? Now we are reinvesting in the stainless- steel wires, that INR 150 crore that you have mentioned in PPT.
Yes, sir. So as I said, when we relooked at our investment, we felt that the backward- integration project would be holding us back in terms of our return- ratios. And we would also be leveraging our balance sheet to a large extent, which we did not want because we want to have surplus cash on our books to be investing in steel cord as and when required. That is one. Second, what has also changed in the last six months is we have been able to streamline our supply- chain in stainless- steel as well.
We are able to get sufficient raw material, whichever is needed to get our stainless steel wire production, which was the main motivation for us to go backward because we felt that we were not able to grow after a certain point because of raw material constraint. But because that has now been taken care of as well. In fact, just to give you an idea, we have increased our sales of stainless steel by 20% or by more than 20% in the last quarter itself as compared to Q1, all because of supply chain issues being resolved. So therefore, we do not see a need to actually invest in backward integration. Rather than that, we would want to reserve our cash and spend on profitable growth in the existing core- business that we have.
Understood. But then I initially understand, Pranav, sir, that we were doing all these measures to be able to achieve double-digit margins in the, let's say, next two, three years. So now that we are focusing all our resources on the existing business and specialty- wires, by when do you, I mean, feel that that double-digit margin should be achievable?
Sir, I think if we look at our EBITDA- per- ton, we would want this EBITDA- per- ton to maybe go to double digits within the next three to four years because of specialty- wire kicking in anyways. In fact, by delaying backward- integration or by removing backward integration as of now from our side, what we have been able to do are two things, actually. First, we have been able to actually get or control our existing business in a better way because that management- bandwidth of ours is safe, and we are utilizing it in our current business, wherein we see a lot of opportunities, and we are able to tap those opportunities very quickly now. Second, specialty wire also, from our earlier estimates, we feel that we might be able to do it a little sooner, maybe one or two months before our current estimates for commercialization.
And as and when we commercialize it, our next phase of expansion will also start in specialty. So EBITDA going into double- digits, I think, is a matter of maybe three-to-four years. But more than that, I would want my ROCE to be better. So even after a double-digit margin, if I'm not earning enough ROCE, that does not make sense. So that's why we have taken a target of 25% ROCE within next year. And I think we are on track to achieving that as well.
So how will we achieve 25%? So by improving our cash- flow, we'll remove our debt. Is that how you're planning to achieve that 25% ROCE figure?
Sir, our internal target as of now is INR 600 crore plus of cash- flow. And I think from our existing estimates, we've already shown that we've done INR 150 crores of positive cash- flow in the first two quarters. In the next six quarters, I think we have room to do a little better. And of course, now, because we have recalibrated our investments, we are not looking at a very major investment every year. So for the next two years, even if I invest INR 200-300 crores in total, I will have enough headroom to grow. Therefore, we will be able to free up a lot of cash from our existing business.
With that, we are also working very closely with our vendors and our customers to reduce the number of inventory and the number of outstanding deals as well. As and when we see some results there, I think we should be able to hit the 25% mark.
Understood. So this cash accrual we'll be making, we'll be using that to remove our borrowing, right, that we have on the company level?
Sir, as of now, our thought process is that at least when we need to grow at 20%-25%, for that growth, we should not require debt. That is for sure. Now, if we are able to reduce that debt or not, I will not be able to comment now because six quarters is still a good enough time. There could be a lot of changes therein. But yes, one thing that I can guarantee you is that at least for growing at 20%-25%, I don't think we will require debt anymore.
Understood. So sir, just an add-on question. I think our interest and depreciation costs both combined have tripled on a year-on-year basis. Mainly due to the new CapEx. But can you give a headline indication on for FY 26, where are these two numbers going, and let's say how will they shape up in the next two years, the interest and depreciation numbers?
Sure. So sir, interest and depreciation, especially the depreciation cost, has gone up because the earlier numbers that you were seeing was ex of Dadri. And at that time, a lot of production was happening in our other companies, which we started to consolidate by end of Q2 last year and Q3, in fact. So therefore, these depreciation numbers are with full Dadri CapEx capitalized, which was the major CapEx that we have done till now. And I think going forward also, we do not see a requirement of doing something like a Dadri every two years or every one year because to grow at 20%-25%, I need maybe 1.10-1.5 lakh tons a year, which should be done within 150-200 crores. So I do not see such an increase of three times again happening.
So broadly, I think the INR 15 crore debt that you take and.
Mr. Akash, Mr. Akash, request that you return to the question queue for follow-up questions as there are several participants waiting for their turn.
Okay.
The next question comes from the line of Mayank Bhandari from Asian Markets Securities. Please go ahead.
Thanks for the opportunity. Sir, I'm just clarifying one thing. You are targeting 60% of the total revenue from the low carbon, is it?
So 60% is volume, not revenue. Volume-wise, our target is 60% because as of now, we have not achieved 60%. We are at 50%-55%. But we want to take this to 60% because that is a business which gives me the best ROCE. So therefore, to get it blended 25% ROCE, we need that in our portfolio.
So currently, low carbon is almost 50% is what you are saying?
Yeah. It's 50% to 55%.
This is for H1 or Q2? This quarter or this other?
This is Q2.
Okay, and just checking one thing, sir. I mean, because you are targeting low carbon, seems to be the key growth driver here. Which all markets this wire is going in? How is the market size growing for this? What rate it is growing?
Sure, sir. So low- carbon, we are servicing three, four different segments. The main segment is power- and- cable industry, wherein this product is used as a cable- armor for all electric power cables. That's a segment that is growing at a very decent pace. And we are able to, in fact, in that particular product, we are doing close to 90% capacity- utilization and increasing, and we are increasing capacities for that product as well every quarter. Second is the B2C segment that we have started, which is majorly for agriculture, fencing- application, and poultry- cages. That is a segment which we have seen a lot of traction in the last two years. In fact, this is why it has contributed to almost 5% of our total volume from almost negligible two to three years back.
This is where we feel that we will be able to increase most of our volume going forward as well.
So B2C is how big for you as of today?
As of now, as I said, it contributed about 5% of our total volume. But I believe that it will grow at more than 30%-35% every year for us now.
This is largely low carbon?
This is all low carbon.
Okay. It could grow by 30%-35%. Okay. And then secondly, sir, on this Dadri capacity utilization, how much we are at currently?
Sir, in terms of Dadri capacity utilization, just give me a minute. For the full quarter, we were at about 35%. But by the end of the quarter, we had also reached 45% kind of a capacity utilization. This is with the new investment already in terms of capacity there.
And on the working- capital side, are we leveraging this channel financing? I see that working- capital has improved also in this quarter, primarily driven by the inventory- days. But debtor- days remains pretty much at last year's level. And in fact, payables has also increased. So channel- financing, are we leveraging or how is it?
Sir, as of now, we've not started leveraging channel financing to a large extent. Some bit here and there we are doing. But yes, we have plans to do this in the next two quarters. And in fact, next year, we will do most of it as well. Therefore, you will see a better number here in terms of receivables going forward. But without channel financing also, what we have also done is tried to reduce absolute debt on our balance sheet as well. Absolute, sorry, absolute number of days. So herein, just through better follow-ups, we are also trying to reduce the number of days- of- outstanding, which will also reflect in the next quarter.
Sure, sure. And what would be the export this quarter?
It's about 9%.
Okay. Thank you, sir. That's it from my side.
Thank you. The next question comes from the line of Prakash from Anand Rathi. Please go ahead.
Hello.
Yes, Mr. Prakash.
Hello.
You are audible.
Thanks for the opportunity again. Just wanted to check regarding the recent fire incident at Dadri- plant. So could you please share the extent of its impact on production volume for Q3 and the estimated financial loss, if any?
Sure, sir. So this incident took place in our specialty- wire area, which was the steel cord shed. Although there was no significant impact of this, but there was definitely impact on our finished- good inventory, which was about maybe INR 6 crore of inventory that we were carrying there. The exact loss, we are still estimating, and we will have a number for you guys very shortly, but otherwise, on numbers, there is no other impact. I think the approval process is also going as per plan, and we will be starting the plant again soon, maybe next week.
Okay. So just another question. As you said about B2C business, so just wanted to check what's the EBITDA- per- ton we are having there on B2C business?
Sir, it's almost 50% higher than our B2B segment in low carbon.
Okay. Okay. Thank you, sir.
Going forward, we are taking a lot of marketing initiatives, wherein we are targeting almost double the EBITDA than the B2B segment in B2C.
Okay. Okay. Thank you.
Thank you. The next question comes from the line of Pratik Singh from DAM Capital. Please go ahead.
Hi. Thanks for the opportunity again. So Pranav, as you said, that the mix is largely rationalized. Whatever cuts or market-boosting efforts that we had to take is largely behind us. So safe to assume on a like-for-like basis, even without specialties, our EBITDA per ton has largely bottomed out and should improve from here going ahead, theoretically at least?
Hello.
Hello. Yeah. Hi, sorry. Can you repeat that?
You are on. Both of your lines are on.
Okay. Yeah. Sure.
Please go ahead.
Sure, Pranav. I'll repeat. So as you said, that largely the mix rationalization and market gaining efforts, as you said, are largely behind us. So safe to assume that this quarter or the kind of EBITDA per ton that we have seen this quarter on a like-for-like basis, we should be seeing an improvement going ahead three Q onwards, or there is still a few quarters before we start seeing this improvement?
Sir, I feel we should see an improvement from next year itself. In the next two quarters, our aim is to further increase the share of low carbon wire. As I said, it is about 50-55% now. We are targeting 60% share of low carbon wire business, which is generally a lower EBITDA per ton business. Therefore, you might still see some small impact in EBITDA per ton, not an increase in the next two quarters. This is why instead of a 35% volume growth, we are looking at a 20-25% EBITDA growth. But from next year, I think those numbers should be the same. And year after that, our EBITDA growth should surpass our volume growth.
Okay. So when you say year after that, you mean FY 28?
Yes. FY 2028 should be a year where we will grow higher in EBITDA than the volume.
Understood. And again, on the other expenses, employee cost side, on a year-on-year basis, yes, it does look like it grew up 40% while volumes also were up 40%. But on a QQ basis, employee cost was up around 26% while other expense was up 30%. Volumes were up only 10%. So is there any one-off that we saw this quarter in other expense or employee benefit expense? Or do we expect this employee benefit expense at least to peak out here and not go up further from here?
Sure, sir. So sir, what was also happening earlier was that we were not able to manufacture enough quantities in Dadri, and we were taking help of the other two companies, the older companies that we had. We were still manufacturing there. Now, because Dadri has finally stabilized, we are also shifting a lot of production from there to Dadri. So from other expenses, which we were paying them as part of job work, now we are putting in our own expenses. That's why there is also some part of labor that is going up. And this trend should continue. But this is not an increase of only labor expense. This is basically expense going from other expenses into labor or employee benefit expense.
Understood. So just as a follow-up here, last year, I think in other two entities which we planned to close, we did around 70,000 tons. How much have we done in the first half this year, and how much are we targeting, and when do we plan to close them?
Sir, we are still doing the same run rate as we were doing last year. But from almost the last month of the second quarter, we have now again started shifting up because, as I said, Dadri has finally stabilized. So this quarter, we should see significant growth in Dadri, and the same reduction should also happen in the other two entities. Within maybe four-to-six quarters, I think we will be able to wind up most of the production elsewhere, and everything will be in the Dadri facility.
Understood. Thanks. Thanks a lot.
Thank you. The next question comes from the line of Dhruv Agarwal from Swastika Investmart. Please go ahead.
Yeah. Good evening, everyone. Thanks for giving me the opportunity. So my question is, as top-line growth is around 21.4%, which is commendable, then why PAT percent down? Generally in top-line growth is so good, then PAT should grow much more?
Sir, as I said before, the PAT growth is not in line with the revenue growth because of higher depreciation cost. If we look at cash profit, which is honestly the actual profit that we get because of depreciation, we have grown at about 17% therein.
Okay. So my next question is, as we understand that your group company, Bansal Aradhya, operates in South India, manufacturing similar wire products. Could you share its scale of operation in terms of product mix, revenue contribution, and also what is current EBITDA and net profit margins?
Sure, sir. So there are not a lot of common products between the two companies. The only product is bead wire, in which we have a very clear differentiation that they sell in South India, and we sell only in North India, and bead wire is also not a major product for us. That is one. Second, that size of the company, I think, is less than 4 or 5% of our total company, Bansal Wire. They do maybe about, I think, 25-30 thousand tons of sale, wherein we are looking at 4,500 tons of sale.
Okay. My last question is, what is the status of new investment announced in Gujarat as land already acquired? When will production start, and how will it affect the company's top-line EBITDA and net profit margin?
Sure, sir, so to grow at 20%-25% every year, we want to invest INR 150-250 crores every year, which is what is the plan for this year as well. In Sanand itself, we will be investing about INR 150 crores apart from the land that we've taken to build about 90-100 tons of wire capacity, and overall, whether it is Sanand or any other facility, the target remains clear, 20%-25% volume growth.
Okay. Okay. Thank you.
Thank you. Ladies and gentlemen, we will take that as the last question for today. I would now like to hand the conference over to Parthiv Jhonsa for closing comments.
Thank you all for joining us for the conference call today. We, at Anand Rathi, would like to thank the management of Bansal Wire Industries Limited for giving us this opportunity. This concludes this conference. Thank you, everyone, and have a good day.
On behalf of Anand Rathi Share and Stock Brokers Limited, that concludes this conference. Thank you for joining us, and you may now disconnect your lines.
Thank you.
Thank you.