Ladies and gentlemen, good day and welcome to Surya Roshni Ltd Q3 FY 2025 earnings conference call. This conference call may contain forward-looking statements about the company, which are based on the beliefs, opinions, and expectations of the company as of the date of this call. These statements are not guarantees of future performance and involve risks or uncertainties that are difficult to predict. 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 the conference call, please signal an operator by pressing star, then zero on your touch-tone phone. Please note that this conference has been recorded. I now hand the conference over to Mr. Raju Bista, Managing Director of Surya Roshni Ltd. Thank you, and over to you, sir.
Hi, welcome everybody, and thank you very much for joining us. Good evening. On this call, we are joined by Mr. B.B. Singal, our Company CFO and Company Secretary as well. Mr. Naresh Singal, Executive Director, Steel Business. Mr. Jitendra Agrawal, CEO of Lighting and Consumer Durables. Mr. Gaurav Jaidka, ED and COO of Steel Operations. Mr. Vasumitra Pandey, COO, Lighting and Consumer Durables Business, and SGA, our Investor Relations Advisors, and I hope everyone had an opportunity to go through the financial results, and moving on to the overall financial performance highlight, we are pleased to have delivered a resilient performance in Q3 FY 2025 despite challenging macroeconomic conditions. During the quarter, our revenues saw a marginal decline of 4%, primarily due to an average 18% year-on-year decrease in HR coil prices.
But we achieved revenue growth of 22%, and EBITDA and PBT grew by 87% and 163% respectively as compared to Q2. Our Lighting and Consumer Durables segment delivered a healthy performance with robust growth across professional lighting, decorative fans, and home appliances. This reinforces our strategic focus on innovation, quality, and customer-centric offering. On a sequential basis, we recorded double-digit growth as well. Optimizing our capacity utilization, efficient working capital management, and strategic cost rationalization have enabled us to achieve zero debt while maintaining a cash surplus fund of INR 220 crore as of nine months FY 2025. Now, coming to Lighting and Consumer Durables, despite industry-wide challenges, including price erosion in the LED segment, our proactive approach to product innovation, strong distribution network, and early market initiatives have enabled us to achieve double-digit growth year-on-year, revenue growth of 12% in this quarter.
Focusing on premiumization, cost rationalization, innovation and technology, and backward integration under the PLI scheme also contributed to improve margins and overall profitability. Professional lighting delivers almost 15% year-on-year growth, benefiting from increased demand across key product categories, including LED street light, where volume nearly doubled. A healthy order book of about INR 150 crore in the professional lighting segment further strengthens our growth momentum. Looking forward, we remain optimistic about the business roadmap, and we are confident in delivering double-digit revenue growth for the full fiscal year in lighting. Our focus will also be on achieving double-digit EBITDA margin through a balanced approach of product mix optimization, operation excellence, and innovation. We are well-positioned to drive consistent growth and reinforce our leadership in lighting and consumer durable segment.
And also, we are investing INR 25 crore at our Gwalior facility in lighting division to set up a state-of-the-art domestic wire business unit of specified size and categories. Now, moving on to the steel pipe and strip segment, the steel pipe and strip segment witnessed 8% year-on-year volume growth, reflecting healthy demand. However, revenue declined by 8% year-on-year to INR 1,417 crore, primarily due to a drop in average HR coil price by 18%. That is about INR 10,500 per ton compared to the same corresponding year last year. On a sequential basis, revenue grew significantly by 25% in steel pipe business from INR 1,135 crore in FY 2025, recording a strong recovery on a quarter-on-quarter basis. EBITDA per ton improved by 78% from INR 2,900 in Q2 FY 2025. EBITDA for Q3 FY 2025 stood at INR 111 crore, declining 9% year-on-year from INR 121 crore.
This EBITDA per ton declined to INR 5,163 from INR 6,156, primarily due to the absence of inventory gain, which contributed INR 1,200 per ton in Q3 FY 2024. Value-added product API spiral and galvanized pipes contributed almost 45% of total revenue for both Q3 FY 2025 and nine months FY 2025. Export sales remained unchanged year-on-year, but globally, trade uncertainties and reservations around U.S. tariff policies prevented a potential double-digit growth. Despite this headwind, we are extending our presence in the Middle East, Saudi Arabia, Europe, and Canada market. We currently have an order book of about INR 600 crore in hand for the oil and gas sector, water sector, and export business. With rising demand for structural pipe in infrastructure, construction, and industrial sectors, we are expanding our section pipe capacity using direct forming technology, DFT, to enhance efficiency.
The new spiral plant in Gwalior and cold rolling expansion at Bahadurgarh plant are set to commence operations in February and March FY 2025 respectively. Our Hindupur facility, we are increasing CapEx from INR 75 crore to INR 125 crore to expand production by almost 200,000 tons per annum, focusing on large diameter 8-20-inch DFT mill and coated pipes for water line project and infrastructure project as well. At our Bhuj Anjar facility, also, we have made an investment of about INR 75 crore for manufacturing of large dia pipe and DFT pipes, which will add another 60,000 tons of annual capacity and support our export business. Steel prices are at almost five-year low, and further declines are unlikely, providing a stable cost environment.
We remain committed to expanding our product portfolio, strengthening our export business, and investing in technology, driving capacity enhancement to drive long-term growth and profitability as well, and that's it. Now, I will request our CFO, Mr. B.B. Singal, to share his thoughts.
Thank you, respected MD sir, and a very good afternoon to all the participants on the call. For the quarter, the revenue was INR 1,868 crore as compared to INR 1,938 crore. EBITDA and PBT stood at INR 156 crore and INR 90 crore as compared to INR 158 crore and INR 90 crore respectively. For nine months of financial year 2025, the revenue was INR 5,290 crore as compared to INR 5,729 crore. EBITDA and PBT stood at INR 397 crore and INR 217 crore as compared to INR 414 crore and INR 225 crore respectively. In lighting and consumer durables for the quarter, the revenue stood at INR 451 crore as against INR 403 crore, a growth of 12% year-on-year basis. EBITDA and PBT stood at INR 45 crore and INR 35 crore, a growth of 20% and 18% respectively. For nine months of financial year 2025, the revenue stood at INR 1,232 crore as against INR 1,154 crore, a growth of 7% Y-on-Y basis.
EBITDA and PBT stood at INR 115 crore and INR 87 crore, a growth of 9% and 5% respectively. In the steel pipes and strips during Q3 FY 2025, the revenue was INR 1,417 crore as compared to INR 1,536 crore. Similarly, EBITDA per metric ton stood at INR 5,163 compared to INR 6,156. EBITDA and PBT stood at INR 111 crore and INR 86 crore as against INR 121 crore and INR 91 crore respectively. For nine months of FY 2025, the revenue was INR 4,061 crore as compared to INR 4,577 crore. Similarly, EBITDA per metric ton stood at INR 4,840 to INR 5,224. EBITDA and PBT stood at INR 282 crore and INR 203 crore as against INR 308 crore and INR 222 crore respectively. As of December 31st, 2024, our net working capital was 57 days with a return on capital employed ROCE of 21.4% and return on equity of 15.63%.
With this, I conclude the presentation, and we can now open the floor for further questions and answers.
Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press Star and 1 on their touch-tone telephone. If you wish to remove yourself from the question queue, you may press Star and 2. Participants are requested to use the 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 Saransh Gupta from SVAN Investments. Please go ahead. The line of the participant was on hold. We move to the next participant. That is Adityap al Singh Jaggi from MSA Capital Partners. Please go ahead with your question.
Hi. Am I audible?
Yes, yes.
Thank you so much for the opportunity. Sir, we wanted to quickly understand from you that the previous con call, that is Q2 con call, we had said that we can achieve 9 lakh tons volume this year, 9 lakh and a few thousand tons this year. But for us to achieve that, we would really need to grow our volumes by 40%-45% YoY. So that would be my first question. Do you think that this 9 lakh is achievable, or do you want to revise the guidance for this FY 2025?
Okay. Next?
Sir, next would be that, again, in the last couple of con calls, we said that in FY 2026, we can grow our volume to 12 lakh tons, 1.2 million tons, but revenue would grow by 10%-12%. From 9-12 lakh, we are going 33% done, but the revenue and volume are not matching. So just wanted to understand, wanted your clarification that are these numbers, is my understanding correct?
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[Foreign language] CapEx, [Foreign language] from FY 2027-2028 because capacity [Foreign language] 15% volume growth [Foreign language] , year-on-year.
Come to that much minimum, in fact 15% plus only will remain. See, what is in this is that we people are also doing a green field project in this INR 500 crore investment.
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[Foreign language]. [Foreign language] spread that is realization minus cost of production is five times by far the best in the industry. [Foreign language].
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To gross margin [Foreign language] , yes.
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[Foreign language] . Thank you so much, sir.
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Thank you. Reminder to all participants to ask a question, you can press star and one. The next question is from the line of Saransh Gupta from SVAN Investments. Please go ahead.
Hello, am I audible?
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G. Thank you, sir, for the opportunity, and I guess I got disconnected earlier. Sir, so as you mentioned that in volume we can see a growth, so can you give us a ballpark number for that? And I have a couple of more questions, so should I like put it ahead?
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And sir, in the upcoming two years as you mentioned that, we can go to a gross margin of 23%-25% with an EBITDA per ton of INR 7,000. So by then, what can we see the volume as?
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[Foreign language] ? Like, when will it, when is it expected to come on stream?
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Okay, sir. Sir, as we have seen a decent pickup in the monoblock residential pump, so in this our EBITDA per ton how much will differ, which is our existing product, from that like if you compare it with the API grade EBITDA per ton?
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And sir, [Foreign language] , by when can we expect this?
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Sir, [Foreign language] last question . Sir, [Foriegn language] government [Foreign language] JJM [Foeign language] focus, they have increased the focus on JJM, so [Foreign language] how do you see the tendering happening in the coming months? Like in last one year, the pipe that we have supplied for JJM, like [Foreign language] working capital cycle [Foreign language] ?
[Foreign language] 2028 [Foreign language] 40%-50% [Foreign language] .
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Okay, sir. That's it for now. I will get back in the queue.
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[Foreign language] , sir. That's great. I will get back in the queue.
Thank you. The next question is from the line of Rohan Vora from Envision Capital. Please go ahead. Mr. Vora, can you proceed with the question, please?
Hello, am I audible?
Yes, sir. You are.
Yes. Sir, thank you for the opportunity. So sir, in earlier comments you said that this quarter API pipes' volume was a bit slow. So when will this get back on track for volume? That was one question. And second, broadly API pipes' demand, where will it come from? Because that is a major driver for its EBITDA per ton. So for that, over the next three years, as we are saying that we need to reach INR 5500-INR 7000 EBITDA per ton, so how do you see API pipes' demand? And where will it come from? Thank you.
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Okay, sir. [Foreign language] EBITDA per ton [Foreign language] over the next three years?
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Thank you, sir. I will get back in the queue.
Thank you. A reminder to all participants to ask a question. You may press star and one. The next question is from the line of Farokh Pandole from Avestha Fund Management LLP. Please go ahead.
Hi Raju ji. Yes, my question was that our net cash position what is at this point, and CapEx next two to three, this INR 300 crore, we are going to spend over next three years, and our capacity, total capacity steel pipe capacity will go to 18 lakh ton?
18 to 19, ya.
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Two years, and what is the net cash position?
As on today INR 225 crore.
Okay, so [Foreign language] we should maintain a net cash position going forward, this FY.
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Thank you. And this wire.
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So, around INR 600 crore, in spite of all this difficulties, [Foreign language] .
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Thank you, thank you Raju ji.
G. Thank you. The next question is from the line of Dev from NMR Capital Advisors LLP. Please go ahead.
[Foreign language], hello. Am I audible?
Yes, yes sir.
Yeah, good evening sir. I just wanted to ask the 25 crore CapEx that you are doing on the wire.
Dev sir, you are not sounding very much clear. There is a lot of echo there.
Just a second. Hello.
Yeah, that's much better. Please proceed.
I just wanted to ask that INR 25 crore CapEx, we are doing in a wire business. Is that included in the INR 500 crore CapEx plan, and is it apart from that?
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Okay, and my second question was [Foreign language] ?
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Okay, thank you. Rest of the questions are covered. Thank you.
Thank you. The next question is from the line of Adityap al Singh Jaggi from MSA Capital Partners. Please go ahead.
Hi, thank you so much again for the follow up. Sir, next year meaning FY 2026 in, we can confidently say that average quarterly volume 100,000 to 220,000 to 2.5 lakh tons we can do?
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[Foreign language]. Sir, all the very best. [Foreign language] , main I will just email it to you all.
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Thank you so much. Wishing you all the very best.
Thank you very much. A reminder to all participants to ask a question. You may press star and one. Ladies and gentlemen, to ask a question, you may press star and one. Reminder to all participants to ask a question, you may press star and one. As there are no further questions from the participants, I now hand the conference over to Mr. B.B. Singal for closing comment.
Thank you everyone for joining us today on this earnings call. We appreciate your interest in Surya Roshni Ltd. I sincerely once again thank our MD Sir and the CEO for sparing their valuable time and addressing queries raised by participants who attended the call. For any further queries, if any, contact our SGA, our investor relations advisor. Thanks, good evening to all.
Thank you very much.
Thank you. On behalf of Surya Roshni Ltd, that concludes this conference.
Thank you for joining us, and you may now disconnect your lines.