Ladies and gentlemen, good day and welcome to the Q4 and FY 2026 conference call of Bansal Wire Industries Limited. From the management, we have Mr. Pranav Bansal, MD and CEO, and Mr. Ghanshyam Gujrati, CFO, to take the discussion forward. We also have the investor relations team from Adfactors PR. 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 touch-tone phone. Please note that this conference is being recorded. Before we begin, I would like to mention that some of the statements made in today's discussion may be forward-looking in nature and may involve risks and uncertainties.
Please note the disclaimer mentioning these risks and uncertainties are on the disclaimer slide of the investor relations presentation that has been shared earlier. I would now like to hand the conference over to Mr. Pranav Bansal for the opening remarks. Thank you, and over to you, sir.
Yeah. Hi. Thank you. Good afternoon, everyone, and welcome to Bansal Wire Industries Q4 and FY 2026 earnings call. Joining me today is Mr. Ghanshyam Gujrati, our CFO. I trust you've had the opportunity to review our financial results, press release, and investor presentation, which are available on the stock exchanges and on our website. Let me start by saying that this year has been a year of a lot of major changes for the company. In fact, I would say that we have completely transformed ourselves through the process and have emerged stronger and sharper. Let me highlight some of the major events of the last year. First, the most important would be our improved focus on ROCE and cash flow generation.
As part of this approach, we deferred our backward integration project, undertook a comprehensive review of operational efficiencies, and realigned our strategy towards our core competencies. As a result, we were able to generate a cash flow of INR 333 crore, exceeding our initial target of INR 250 crore, and we remain on track for achieving our total target of INR 600 crore by 2027. By doing this, we have also remained well-positioned to fund our growth ambitions while maintaining financial discipline. Second, even though there was a fire incident in steel cord shed, which led to a delay in our approval process, we made meaningful progress in strengthening our specialty and value-added wire portfolio. With IHT wire demonstrating a strong momentum, phase one ramping up in line and with even exceeding our expectation. We also received a faster than expected approval.
Phase two of the expansion is also progressing as planned, adding 6,000 tons of capacity on the existing 9,000 tons. Even on steel cord front, we have made a major breakthrough and are expecting our very first trial order very soon. We started our LRPC wire product with 18,000 tons of capacity, which is also towards the end of this year, started generating positive EBITDA. During the last year, we also strengthened our B2C segment with a focused strategy on expanding our distribution network, enhancing brand visibility, and introducing customer-centric product offerings. This segment has also started picking up, and we have launched 16 new product offerings for the western and southern part of the country. Turning to our manufacturing footprint, our installed capacity now stands at approximately 680,000 metric tons, with the Dadri facility continuing to anchor our growth.
During this year, we added about 120,000 tons of capacity at Dadri, completing our first phase of this expansion. This facility not only supports volume growth, but also enables us to deliver high value-added products with improved consistency and better operational efficiencies. Last, and I would say one of the most important event, which is something we are all dealing with, particularly in the month of March, we saw some disruptions due to geopolitical tension involving Iran and Israel, which led to volatility in global energy markets and supply chain challenges. We also experienced a temporary disruption in natural gas. Our production took a cut to 35%, which also had a short-term impact on our production schedule.
Despite these headwinds, our volume remained resilient, increasing by 33% for the full year, while EBITDA and revenue grew by approximately 20%, reflecting our underlying strength of our business. As we enter the next year, we anticipate a relatively subdued start, particularly in the first quarter, given the ongoing situation. However, we are proactively taking measures to mitigate these impacts and remain confident in our ability to navigate the near-term challenges. Once condition stabilizes, we still expect us to return on our targeted 20% growth trajectory, supported by our strategic initiatives and already available capacity. I'll now hand over the call to Mr. Ghanshyam Gujrati, our CFO.
Thank you, Pranav sir, and good afternoon, everyone. Let me walk through the key financial and operational highlights for the quarter four and for the full year FY 2026. Let me begin with the volumes. During this quarter, we delivered a sales of 1.17 lakhs metric tons, reflecting a 20% year-on-year increase. Volume were slightly lower on a sequential basis, primarily stemming from the disruption of industrial gas supply, as highlighted by our MD, sir, Pranav-ji. For the full year, volume stood at 4.58 lakhs metric ton compared to 3.44 lakhs metric ton in FY 2026, translating into 33% year-on-year growth and making the highest ever sales volume achieved by the company. This volume was sustained consistently across the quarter, and supported by the broad-based demand that our diversified end market exposure provides.
Moving to the financial, first quarter for the FY 2026, the revenue stood at INR 1,136 crore, reflecting 21% year-on-year growth. EBITDA for the quarter was INR 80 crores with a margin of 7%, and net profit came into it, INR 40 crores, up 21% year-on-year. For the full year FY 2026, revenue stood at INR 4,160 crores, reflecting a growth of 19% over FY 2026. EBITDA was INR 324 crores, up 17% year-on-year, and net profit for the year stood at INR 161 crores, higher by 10%, both reflecting healthy growth over the last year. With that, I'll conclude my remarks. We can now open the floor for questions. Thank you.
Thank you. 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 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. Our first question comes from the line of Parthiv Jhonsa from Anand Rathi. Please go ahead.
Hi. Am I audible, sir?
Yes.
Thank you for the opportunity, sir. Congratulation, especially, you know, during the third month of the quarter, still you have been able to keep your volumes intact. Congratulations on that, sir. My first question is pertaining to one of your opening statement where you stated that the year has started on a bit of a subdued note. Is it possible to, you know, quantify what is the issue, particularly from, say, gas? What is the gas availability today? What can be, you know, the headwinds or what can be the volume disruptions, particularly for Q1 of this current financial year?
Yeah. Sure, sir. Q1, we have started with, of course, lesser volumes. In fact, last month, our volumes were cut to an extent of 35%. However, those are still, those are back. We are now expecting about 80%-85% kind of our volumes to, you know, be there. Other than volume, there is also an issue in demand as of now. Other than I would say the automotive segment, all other segments that we see, we still see a lack of demand. All our customers, all segments are still, you know, undergoing these issues. Till the time this doesn't go back to normal, I am not expecting, you know, sales also visibility to be there.
Okay.
It is difficult for me to quantify this. I think we are all on the same boat and, you know, we'll have to see how it goes. Yeah, what I can say is that once we normalize, I think, overall, we are still expecting, you know, 20%, kind of a number to be there, but of course, only once we normalize.
Sure. We respect that, sir, that you have kept your, you know, yearly volume guidance intact at, say, 20% growth. Just wanted to just add on to that, despite, say, you know, volumes are down, considering the gas disruption and the demand, I believe the prices would have been much better, right? Because the steel prices have gone up substantially, especially post, you know, starting of the year. The prices are already up on the range of almost about 10%-15%. Will that actually support your top- line despite you losing on the volumes?
Yes, I would say that would definitely support our top- line, that would still not translate to real earnings. At the end of the day, our business is still driven by volumes and EBITDA per ton. In fact, if we talk about only EBITDA, because of operating at a lower base, our, even our cost is higher. Our EBITDA per ton will also take, you know, some hit. The revenues might be intact or might be higher, at the end of the day, it is all about the quantities that I am able to sell.
Is it possible to quantify that, sir? The number by any chance?
Sir, right now it is very difficult. I mean, every day is a new day. Every day we have different challenges. It is definitely getting better.
Okay.
Yeah, we'll still have to see, you know, how long, this, yeah, happens, sir.
Sure. My second question was particularly steel cord business. s ince, you know, since IPO, practically we have been, you know, stating that the approvals would be there. However, there were some, you know, headwinds and now I think, about a quarter call or two quarter call back, you had stated that we'll be entering the phase two trial process. This call you have stated that you are almost on the verge of getting the first trial order or the first order. What can be the quantum and what can be the delta now that finally things have been looking up for you from steel cord vertical? From which customer have you been receiving these orders? Which of the automobile companies?
The order we've, we would be receiving would be from the top four companies in India. Yes, there, our year started slow because of the fire incident, but we've picked up. It will be our first trial order. Once, you know, we supply that order and if the customer finds everything to be intact, then we can expect a regular order from these customers.
Okay.
When that will happen, how that will happen, we will keep you updated, but it is very hard to predict, today.
Sure. The phase two trial is already been completed, right? If I'm not mistaken then.
Yes. With some, with one, with one customer which we would expect this order from, yes. There will not be a phase two trial process. It will only be a sample and then some tests.
Okay. Okay. Got it. Got it. And if I may quickly squeeze in the last one from my side. Is it possible to quantify what is the even, you know, a broad benchmark numbers are fine, but is it possible to quantify what is the, you know, share of say low carbon, high carbon and specialty in top- line as well as the EBITDA? In percentage terms is also fine.
Yeah. Overall our product mix has remained the same. I think 55-ish% of low carbon, 25% high carbon, and 20% stainless steel. In general, this is the broad thought process that we have, and there has not been a major change here.
Low carbon would have much lower EBITDA contribution, so that means your EBITDA would be much higher from high carbon and stainless as compared to low carbon. Is it?
Yes.
Is it that understand? Yeah.
Sure.
What is your share there at the EBITDA level?
Sir, we will not be able to give you separate EBITDA levels for all streams. What we were, what we would be showing to you is the EBITDA pattern on a blended basis. This is where we focus on.
Sure. Sure. That was quite helpful, sir. If I have any further question, I'll join back with you. Thank you so much.
Sure.
Best of luck, sir.
Thank you. A reminder to all participants, you may press star and one to ask a question. The next question comes from the line of Prateek Singh from IIFL Capital. Please go ahead.
Hey, hi, Pranav. Thanks for the opportunity. The first question was largely on the industry side. Given it's a low margin industry and we are the market leaders here, I would assume this cash problem would be faced by a lot of your competitors who are in a much smaller scale. Fair to assume that they would be in pretty much dire situation right now if demand is weak and we can expect to gain market share despite demand being weak right now.
Sir, if you break this demand situation into different sectors that we have, I would say the automotive sector has been doing well. There we are still able to grow even through all of this. Yeah, I think, for us automotive is okay. Every other sector, whether it is consumer durable, infra, all of there, we are seeing a very sluggish demand. This is because of two reasons. One is there has been a big price increase in steel in the last three months. The second is, of course, the situation we are all going through. Yeah, I mean, it still looks positive. Every day is getting better. Yeah, let's see what happens.
Understood. In the past, when we had stated that to gain market share, we would be taking a hit on our margins, is that phase largely behind us or do you think to gain this 20% growth this year as well, our EBITDA margins or EBITDA pattern would be likely lower than what we showed this year?
No. From this year, there is no more, there's no impact, negative impact on EBITDA, which we are, which we foresee, in terms of our regular operation. If we grow at 20%, our EBITDA should also grow at 20%. Of course, you know, this current situation, we have to keep aside, but once we turn back to normal, I think, our EBITDA pattern should be same or, if not better.
Okay. Lastly, what's the update on the two units, I think, Balaji Wire and Bansal High Carbon, which were going to be shut down. What's the plan there right now?
Those two units again are operating at almost negligible capacity utilization. All of it has mostly shifted to Bansal Wire. I think maybe the next, the last 4%-5% that would be remaining would shift in another maybe six to eight months.
Okay. Thanks, Pranav. All the best. I'll join back with you.
Thank you.
Thank you. A reminder to all participants, please press star and one to ask a question. The next question comes from the line of Disha from Sapphire Capital. Please go ahead.
Hello.
Yes, please go ahead, Disha.
Am I audible?
Yes, please go ahead.
Yes, ma'am. Go on.
Yeah. Thank you so much for this opportunity. Sir, firstly you mentioned that currently also we're operating at around 80%-85% volume, so we see 20% production cut in the month of April as well. Going forward, how confident are we to maintain this 20% sort of guidance that we've given? Do you see any downside? You mentioned that auto sector is doing well, but that contributes I think around 22% to our revenues. Is there any sort of downside you see to this 20% guidance?
Ma'am, again, right now it is very difficult for me to, you know, give you a number because it is a very dynamic situation that we are all in. Yes, as of now, what I see is that situation is getting better. Right now there is sluggishness in demand, but we feel that it is getting better every day. We are hoping for the best. Once it turns back to normal, yes, we should be able to grow at 20% because we have that kind of a capacity available with us from the starting of the year.
Just, like, given the current time, we're fairly confident we'll be able to do 20% growth?
Once we, once we return back to normal, yes, 20% growth is what we should be able to do.
Okay. This IHT wire segment, this new segment that we added, what sort of capacity utilization were we at in Q4?
In Q4, I would not have the right figures, but yeah, in, I would say in the month of March alone, we were at about 25% capacity utilization in IHT. Which should increase by 10%-15% every month.
What sort of EBITDA per ton do we see in this one?
Ma'am, right now, it is not contributing much, but once we touch 50% capacity utilization, I think it should turn into positive EBITDA.
Okay. What sort of CapEx are we looking for FY 2027?
FY 2027 or, in fact, even in the years later, I think, our CapEx strategy is now focused on our cash flows. What we are expecting is majority of, or maybe 60%-70% of our cash flows we will pull back into CapEx. Maybe INR 150 crores-INR 200 crores, something like that, to generate enough capacities to grow at 20%.
The product mix that you mentioned, of, 55% low carbon and 25% high and 20% specialty, that we expect to be pretty much stable in FY 2027?
Yeah, that should be stable in this year as well. That's specialty right now in a percentage is nothing, so it's 20% of stainless. Yes, in this year, specialty should also come as part of this product mix.
Okay. Okay, fair enough. Thank you so much. That is it from my side.
Thank you.
A reminder to all participants, you may press star and one to ask a question. The next question comes from the line of Deepak from Sundaram Mutual Fund. Please go ahead.
Thank you for the opportunity. Am I audible?
Yes.
Yeah. Hi, Pranav. Pranav, my first question is with respect to our payables. This year we have seen a sharp spike in our payable, both in absolute terms as well as increase in the number of days. Just wanted to understand, have we structurally made any changes in the way we are sourcing? Let's say instead of a mill, are we procuring more through dealers, on account of which we are getting better credit term, hence the payable days have improved for us?
Yeah. Sir, we are still buying from our main suppliers, and most of those suppliers we are still paying for them, we are still paying them advance. We are also, we've also included a lot of discounting limits from this year, which is where you are seeing the payable going high. This is part of the discounting facility that we have done in purchases. Our vendor is still getting advance payment, whereas we get that kind of a credit.
Okay. Okay. If I understood correctly, you're still procuring from the steel mills, but instead of paying them on an advance basis, you are using purchase invoice discounting, where the bank pays them and you pay the bank later. Correct?
Yes, absolutely.
Okay. Okay. Thanks. Thanks. Do you see, going forward, this number to go up further? I mean to say your payable days going up higher as you increase your banking or discounting through, let's say, the banking methods?
Yes.
Do you think that right now it has come at a stable level?
No, sir, it can go higher. As in when, you know, we are trying to reduce our total working capital days, so in that effort it could go higher gradually.
Will that also lead to increase our interest expense?
That will definitely lead to increase in our interest expense, but not disproportionately. We are already paying that interest even today, but that is done through our regular limits.
Okay, got it.
There should not be a further increase in interest cost because of this.
Got it. The second question is on our balance sheet. If I see that from last presentation to this presentation, we have expanded our capacity by around 60,000 metric ton, r ight? Despite that, if I look at your balance sheet, we are having an INR 213 crores of capital work in progress. Just wanted to understand what is that?
This capital work in progress is part of the 60,000 tons also, which we have installed but not commissioned till date. That will happen in this month of April, o ne. Second, this is also part of some ongoing investment to further enhance our Dadri facility. From this 6.8 lakh tons, we would want to this year add another 1.2 lakh tons so that we are prepared for the year after this. This is where, you know, this kind of investment is going in.
Okay. If I understand correctly, so we were in the process of adding around, I think 90,000 tons in Sanand, right? And you are saying now that, from 6.8 lakh tons, again, we'll be adding 1.2 lakh tons in Dadri itself. Would it be fair to assume in FY 2027 you'll be adding 1.2 lakh tons in Dadri and let's say 0.9 lakh tons in Sanand?
Sir, that 0.9 lakh tons will come towards the end of 2027. We will only be able to utilize that in 2028.
Okay.
Not in 2027. For this complete year, we would still be adding some capacities here and there. For example, the ongoing IHT Wire expansion of 6,000 tons is happening right now. There are some expansion for low carbon, high carbon also-
Okay.
... for us to have the capacity headroom to grow at 20% for the next two, three years.
Got it. As per your internal estimate, let's say by end of FY 2027, our capacity will increase from INR 6.8 lakh to what number?
From INR 6.8 lakh, it should be at least INR 8 lakhs. With Sanand coming in it might be INR 8.5 lakh or INR 8.6 lakh, something like that.
Okay. you are saying because the demand situation is so dynamic that you would want to, like, tweak your CapEx number. That's the correct way to read about it, right?
Our CapEx investment side should be capped at INR 200 crores or something like that. We should not be going higher than that for a year to be growing at this pace.
Okay. Okay.
At least we see a good demand other than this situation. We were already utilizing a good amount of capacity. Even in last quarter, if you leave March aside, at least 15, 16 days of March aside, we were doing a good run rate. It is only in the last 15 days that we took a hit. Even then we were able to, you know, do about 120,000 tons in that quarter. We should, I mean, we have a good opportunity. Once situation returns to normal, I think, yeah, we can do something good. Therefore, the 20% number growth thought process still remains.
Okay. In this 120,000 tons capacity that we're looking to add in Dadri itself, would it be equally split between low carbon, high carbon and specialty, or it would be more leaning towards, let's say, low carbon and high carbon?
It would be, yeah, I think it would be similar to the current product mix that we have. Not a big change.
Got it.
In some ways, maybe some specialty would increase disproportionately, but yeah, other than that, I think overall same.
Okay. and one this last question on steel cord business. I think last time you indicated that we were undergoing some field trials and now you're saying that some trial runs are going on. Is it similar to the field trials or is it that the field trials has been completed and you'll be sending your first trial batch and then ultimately if that gets approved, you will start commercial supply?
Sir, generally the thought, the process is that once we receive a sample approval, the product goes for field trial. With some customers, you know, because of the result that they have gotten from the sample itself, there are some customers who have removed the field trial process, and therefore we are expecting a trial order from them.
Oh, okay.
Once we receive the trial order, once we supply them, they test it, then we can actually expect a regular supply level.
Okay.
Even though there was a delay because of the fire, because of this, we've been able to cover that time also.
Okay. That is expected to happen in H2 of this fiscal year, correct?
Yeah, that's the, that's the thought process, but that's only one customer. Overall, we are still expecting, the other customers to be in line by the end of this year.
Okay. Okay. Thanks, Pranav. Very helpful. All the best.
Thanks, sir. Thank you, sir.
Thank you. The next question comes from the line of Het Shah from Dalal & Broacha Stock Broking. Please go ahead.
Yeah. Thank you for the opportunity. Am I audible?
Yes, sir.
Yeah. Firstly, my question is on the Sanand balance land. Firstly, you scrapped off our plan for, you know, the backward integration. In the last con call also you had said, you know, probably the decision to sell or to come up with another CapEx would be taken in the next quarter or so. I mean, have we come up with any decision on that balance 50% land?
Sir, the balance 50% land, we would be trying to sell it off to get that cash in. We have deferred our backward integration project, and for the next couple of years, it does not fit in our, you know, strategic investment scheme. Any decision that we take on backward integration would at least be after those two years. Because we already have specialty wire, which has now turned very well for us and the regular market of high carbon, low carbon, wherein we would want to spend most of our investments.
Got it. Got it. The next question is with regards to EBITDA per ton. If you look at this particular quarter, it was the lowest in the last eight quarters. I am talking excluding other income. What was the volume mix?
Sir, there was not a major change in volume mix. The EBITDA per ton impact that you see would also be because of the last 15 days in March. There was a substantial increase in our gas prices to a tune of INR 4,000-INR 5,000 a ton on our product level, which is something that we were not able to absorb, which is something that we had to absorb because we have a 30 to 40-day order book.
Got it. Got it.
Although we have started getting that increase from our customers, but the 30 to 40-day order that we have has to go with that kind of a cost level. We've taken some hit in EBITDA only in those 15 days.
Got it. Fine. Just a reiteration of what the previous participant had asked regarding the new 1.2 lakh ton, you know, capacity that will be coming up at Dadri. FY 2027, the total capacity would be 8 lakh ton, right? Utilization levels, what can we expect? I mean, standards.
Sir, that depends on how the year goes. Yes, we have already done about 4.8 lakh, 4.6 lakh tons this year. We were expecting to increase this by at least 20% once if it was a normal situation. Whenever it turns to normal, I think we will be in that run rate.
Okay. I mean, just to understand, when will that 1.2 lakh ton capacity be available?
That will be towards the end of the year because we already are sitting on a reasonable capacity right now. For the first half of the year at least, we don't need it. With this situation, you know, we have also tried to, you know, delay some things by two months or three months till whenever it normalizes. I mean, the thought process is to, for us to be able to utilize the capacity whenever we have it. We don't want to sit on idle capacity, so we can tweak it as per our requirements.
Got it. Finally, the Sanand one entirely will be available then FY 2028, right? That will be available in December 2027 or will be the last quarter of 2028, FY 2028. Right? Is my understanding correct?
Sir, we have a lot of flexibility here because we have our own machinery division, so we have a lot of flexibility as to, you know, when, which month, which quarter we need to invest looking at our utilization levels. Our thought process overall is to generate 20% capacity every year and grow at 20%, keeping at a good utilization level.
Got it. Got it. Fine. That's all from my side. Thanks a lot. Thank you.
Thank you.
All the best.
Thank you. The next question comes from the line of Samay Shah from Nuvama Wealth Management. Please go ahead.
Yeah, thank you for the opportunity, sir. You mentioned that the total capacity is now at 680,000 metric tons. Would you be able to mention what is the split between high carbon, low carbon and stainless steel? What were the capacity utilization on those in FY 2026?
Sir, our general split in terms of capacity or in terms of utilization is generally MS, which remains within a range of 55%-60%. High Carbon, which remains in a range of 25%, so maybe 20% or 30%, here in average 25%, and Stainless Steel at about 20%. Specialty is, you know, right now less than 3%, 4%.
Okay.
Overall, we were at 67%. Overall, we were at 67% capacity utilization.
Okay. Okay, fair enough. That helps. The capacity that is coming up now at Dadri of 1.2 lakh tons, even that will be split in the same ratios?
Yes. Broadly, that will be the ratio in which it would be.
Okay, fair enough. Thank you. That's it from my side.
Thank you. The next question comes from the line of Pujan Shah from Molecule Ventures. Please go ahead.
First of all, thanks for the opportunity. I might be new to the company, so the question might be repetitive, so please spare me for this. My first question pertains to steel cord. if I map on the industry size, that could be industry size is roughly around 2.5 lakh tons. If we expect a growth rate of 11% as well, that industry could grow at 4 lakh tons, right? In that space, first, Bekaert has already been planning to expand. Second, Chinese has also been expanding into Thailand, and then they are trying to supply from there. How we are looking at the scenario, and are we still planning to go ahead with the 2 lakh tons of capacity in this steel cord?
Yeah, sure. You are definitely right on the, all these assumptions. Of course, we are planning to go ahead with this capacity. That's the main focus area for all of us in the company. Because there is only one company in India today making this. We are the only and the first Indian company to start. We see a good traction in this product. From our current, from all calculations that we have done so far, even the pricing looks okay. The assumption that we made still stand correct. There is also a duty whenever there is an import. We also have a 10% arbitrage when we look at import prices. It is a good business as of now.
All our calculations support it. This is the plan. Once we get our approval, our definite goal is still 2 lakh tons of steel cord.
Okay. Sir, my the second question is related to the same. If we look at the total, let's suppose in FY 2031, when we conclude with our 2 lakh tons of capacity, we might spend around INR 2,500 crores. In that thing, if we broadly calculate, we get a revenue of roughly around INR 2,500-INR 2,700, in which if we calculate the margin of 25%, that makes a roughly calculation of INR 600 crores, right? In that INR 600 crores, our payback should be around five to six years. Is that assumption correct, or am I calculating something wrong?
No, you're absolutely right. However, because it will be spent in the next five to seven years, we've taken a ballpark range of INR 2,000 crores-INR 2,500 crores of total investment for 2 lakh tons. EBITDA as of now will range between INR 600 crores-INR 800 crores.
Got it. Got it, sir. Sir, just want to understand what gives us so much confidence when we have been investing, because then ultimate, the total pie, if we look into it, we will be the largest, catering to this segment. If let's suppose any competitor comes up, like let's suppose example Tata Steel. If they come up, they might not go with a small kind of investment. They can, they can also spend something large. So what gives us confidence that we could be the market share leader and we will be able to utilize our facility up and running at 100%?
Sure, sir. Sir, there are what we at least feel a lot of barrier to entry in this product. Technology is one, to get the right people is another. We already have about 60 trained people, you know, in this field, and it is not very easy to get the right set of people. Technology also, we have exclusive collaboration, the exclusive tie-ups with our suppliers, and they're probably a very limited turnkey solution providers in this product. Third, there is a long approval process. Right now we are confident on this approval cycle, and we've been able to manage it till now as well because there is nobody in the country. Once there is a supplier, it will go back to a lengthier approval process.
Lastly, I would say is also our style of investment. Because we have our own machinery division, because we have been in this industry for about 85 years, and we have this diversification into a lot of different products, we are also able to keep our CapEx per ton very low, which is the same case steel cord as well. The industry norm for this would be at least 50% higher than what we are looking at, and which is what we've already done in the first 20,000 tons.
Okay. Sir, just want to get some sense on the approval side. Let's suppose, example, if a tire company approaches you or we approach as a tire manufacturer. Just to understand, they will start manufacturing steel cord applicability with a new product they have been launching, right? If they have launched 10 products before the approval, they might be continuing with the company which they have already approved or they've been approved, like let's suppose example Bekaert. If they had approved a Bekaert, then they will continue with the process, but the new products launches will start with us. That's the assumption, correct? Or they also replace the older models as well with wire cords?
The main consumption will happen in the existing models. In fact, in the newer models, they would choose to go with existing established players first and then approve us. What our market would be, would be the regular tires, would be the regular products that they make today. That is where we are taking the chunk.
Okay. Why do they shift? One of the obviously the reason would be, but on the overall cost side, they might have a 5% - 7% of the total cost in their total the co-manufacturing cost. Why do they shift specifically to us in the going model or the model which is up and running? What could be the key reason? It might be obviously 1%, 2% cost saving could be there. Second, the new product launches that have much more acceptability of steel cord versus theirs. Is that how it works or it is very different than what I'm assuming?
No, you are right. Other than that, I think it is also a security of supply chain. Today, they are not able to buy anything from India. Everyone has to import. I think in the last five, seven years, we've all seen, you know, how disruptions happen if you are dependent, majorly on imports. I think that is one big steel cord as a percentage of the total cost is not a big number, but it is everything to make a tire. This is a very important product and everyone I would assume, and I feel that all customers would be happy to get an Indian source. This is our assumption of this product.
Got it, sir. Got it.
Thank you.
Continuation with ISG and OSG, we have been kind of gonna receive all the BIS, I think, approval from the authority. Are we on place? Do we have received or what current status? Hello?
Pranav, sir, please go ahead.
Yeah, sorry, I'm not able to understand your question. Maybe we can take this later.
Okay. Okay. Okay. Done. Thank you. Thank you.
Thank you. A reminder to all participants, please press star and one to ask a question. The next question comes from the line of Kunal from Veritas Research and Advisors. Please go ahead.
Yeah. Hi. Hi, Pranav, and thank you for the opportunity. Am I audible?
Yes, sir.
Pranav, just wanted to understand, see, are we being more conservative due to the current issues and the geopolitical issues that lead to the volume growth guidance of 20%? As earlier, I guess we used to grow at 30% +, and even though we had guided 30%-35%, right, in the previous calls. Just to understand your thought on the guidance and going forward, like even if you can throw some light for FY 2027, FY 2028 also.
Sir, as a company, even in the last 10 years, we've grown at 20%, not 30%. There has never been a 30% kind of an averaging that we've done. Our estimate for 30% was only last year.
That was because there was a lot of pent-up demand that we had because we were not able to have our capacity up and running quicker. Therefore, we had a 30% estimate of quantities last year. Now that the situation is normal, I think the goal overall for the company is to grow at around 20%-25%, you know, each year. Some year could be a little less, some year could be a little more.
Understood.
20% is the broad understanding.
You're talking about volume growth, right?
Volume growth, yes. Volume as well as EBITDA.
Volume as well as EBITDA.
I mean, yeah, the growth when we say growth, it is majorly our EBITDA growth.
Okay. Okay. Understood. Just to follow up that, in the year of FY 2026, what was the capacity utilization, by the way?
We had the capacity utilization for FY 2026 was 67%.
68% overall.
67%, 68%. Okay. Okay. For FY 2027, are we aiming to be at 80% or plus?
Sir, our, yes, I think 80%-85% is where I get the best return ratios for my investment. Because every year we also need to invest for the 20% growth next year. We will see. I mean, 70% + is what we should look at at least.
Okay. Okay. Pranav, another, just a bookkeeping question. In the previous call that you highlighted that most of the CapEx has been done, and hence the depreciation and the finance cost has been capitalized, and we will going to be see the PAT growth, I mean, say bottom line growth going forward. I just wanted to understand, even this, in this quarter PAT was largely driven by the lower taxation benefits and all. Can you please throw some light, is my reading correct?
Sir, majority of depreciation that we had to take, as we have already done. Any increase in depreciation will happen only with increase in actual EBITDA levels also. There is not going to be a disproportionate extra investment or extra depreciation or even interest that we should see in the long run. Our thought process is whatever, if let's say the EBITDA grows at 20%, our PAT and, sorry, our depreciation and interest should also grow around the same range. Not higher, not very low.
Okay. Thank you so much.
Thank you. The next question comes from the line of Prateek from IIFL Capital. Please go ahead.
Hi. Thanks for the follow-up. Just clarification, for this 1.2 lakh tons that you are adding this year, the CapEx would be around INR 150 crores?
Yes, sir. Broad range that we want to remain is around INR 200 crores, INR 150 crores-INR 200 crores every year.
Okay. To grow at 20% obviously this 1.2 lakh number every year will also need to keep going up because your base will keep getting bigger.
Yeah. As of now, for the next two, three years, I think, average of INR 150 crores, INR 200 crores average. Of course every year it should increase by 20% our investment if we are also growing at 20%.
Okay. After a point when you decide that you have to go steel cords, then your volume growth may slow down because much of your CapEx will be going toward low steel cord business, which generates higher-
Yeah.
... EBITDA but volume would be low.
Absolutely. That's why I'm talking about investment and not just absolute volumes here.
Yeah.
Our thought process is more on investment. Now, wherever we make investment, volume could be different.
Understood. Sir you said that, currently, you'll be sending trial volumes to one of the tire customers. So whenever the final order comes, when do you think, in your assessment, when can we start doing 20,000 tons run rate steel cord? i mean, which month or which quarter almost? Is it like three, four quarters away or more than a year away? How could we look at it?
Sir, although, because of the fire we definitely had a pushback of up six months. Because of this, expedited approval also, we might see some numbers within this financial year.
Okay. Okay. Currently are we selling hose wire from that facility or hose wire is still not being sold?
No, we are selling hose wire from this facility. That is where we are now almost, we are trying to cover most of our main cost through selling hose wire.
Understood. Just last question. When you said that the gas impact in terms of pricing per ton or costing per ton was around INR 4,000-INR 5,000, so the way to look at it is that if you're making INR 7,000 per ton EBITDA, only for those 15 days your EBITDA would have gone down to INR 2,000-INR 3,000 per ton. Is that understanding correct?
Yes, you are absolutely correct.
You would have lost INR 15.
Yes. We also had, we also carried 10 to 15 days of inventory. Our inventory also helped during that time. It was not a complete hit that we had to take for the first 15 days.
Okay. Pricing has completely gone back to normal or have you been able to completely pass it down or there is still some hit in terms of EBITDA but on some gas as of now?
Sir, one good thing is that we have a very cost-plus business model wherein we keep 30-40 days of inventory and 30-40 days of order book. This being a very exceptional increase, consumable is not something that we are able to take on previous orders. Any orders that we booked after, you know, are being impacted on our cost, we have taken our increase. Even today, the orders I am booking are with an increased pricing, considering all this increase that has taken place. For 30-40 day of order book, that order will somehow go at the old pricing, wherein we are taking that price hit.
Yeah, no, that's fine. Yeah, fresh orders only I wanted to ask about. Understood. Understood. Thanks. Thanks a lot, Pranav.
Thank you.
Thank you. The next question comes from the line of Parthiv Jhonsa from Anand Rathi. Please go ahead.
Thanks for the opportunity, sir. Again, just continuing on previous participation, participant, question on the gas. Just wanted to understand what is the current scenario looking like? Are your suppliers, you know, asking for a higher price or what is the escalation in the prices? Can we get a broad understanding as far as gas prices are concerned?
Gas prices have still not returned to normal. They are still escalated. In some areas, in some units it is about 50%. In some units it has gone up to 300% as well.
What will be the blended escalation for quarter one?
Blended, I would say would be at least about 50%.
Is it a fair understanding to assume that for quarter one, for example, if your EBITDA per ton was say about anywhere between INR 6,500-INR 7,000 and, you know, just continuing on couple of other commentary, would it be possible a fair assumption that at least for the month of April, your EBITDA would be in the range of, say, about INR 1,500-INR 2,500 or is that understanding way too low than what the current scenario is?
Sir, it depends on. Right now we are only in April, and we are seeing, you know, in the first month and we are seeing demand coming back. I don't think it should, the whole of the first quarter should go to that extent. I'm sure we will see some recovery happening. This INR 2, 000-INR 2,5 00 ton level is only for the 30-40 days of order book. The whole quarter is not going to be that. After that it will return to normal.
Okay. Perfect.
Out of 90 days, I think at least 50 days of standard EBITDA we should get.
Perfect. Perfect. That sounds good. Sir, second question is steel cord. Considering one of the large global brand is there in the market, you know, supplying the material to the, you know, tire manufacturers for quite a few years, right? What, how much discount or what would be the delta you need to incur to just to gain the market share? Just wanted to understand up to just push the volume, what is the kind of, you know, ASP reduction you need to consider compared to that particular MNC?
Sir, right now I think it is still too early, to, you know, judge, the exact pricing level. As and when we, you know, move forward in the journey, I think we will come to that. We, we do not expect a very big difference between us and, you know, anybody else, because right now, we are the first Indian company, so I am, we should get that advantage at least. You know, if not, just being a new entrant, not reducing price to a very large extent.
Perfect. Perfect. That sounds good, sir. Thank you. Thank you, sir.
Okay. Thank you.
Thank you. Ladies and gentlemen, due to time constraints, that was the last question for today. I would now like to hand the conference over to Mr. Pranav Bansal for the closing remarks.
Thank you, everyone. Thank you for staying connected. Thank you for watching us closely. I hope we were able to answer all your questions. If there are anything that is left, please let us know and we will get back to you guys. Thank you for joining us. Thank you.
Thank you, sir. Ladies and gentlemen, on behalf of Bansal Wire Industries Limited, that concludes this conference call. Thank you for joining us, and you may now disconnect your lines.