Ladies and gentlemen, good day, and welcome to Q1 FY 2027 earnings conference call of Venus Pipes and Tubes Ltd, hosted by Nuvama. This conference call may contain forward-looking statements about the company, which are based on the beliefs, opinions, and expectations of the company as on the date of this call. These statements do not guarantee the future performance of the company and may involve risks and 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 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.
I now hand the conference over to Miss Sneha Talreja from Nuvama. Thank you. Over to you, ma'am.
Thank you so much. Good afternoon, everyone. On behalf of Nuvama, I welcome you all to Q1 FY 2027 earnings conference call of Venus Pipes and Tubes Ltd. We are pleased to have with us management team of Venus Pipes, represented by Mr. Arun Kothari, MD; Mr. Dhruv Patel, Whole-time Director; and Mr. Kunal Bubna, CFO. We will have our opening remarks from the management, followed by the Q&A. Thank you, sir, and o ver to you, Arun, sir.
Good afternoon, and w arm welcome to everyone on the Q1 FY 2027 earnings call of Venus Pipes and Tubes Ltd. I am joined by Mr. Dhruv Patel, our Director; Mr. Kunal Bubna, our CFO; and SGA, our investor relations advisor. We have uploaded our Q1 FY 2027 presentation on the stock exchanges and in the company's website, and I hope you have had an opportunity to go through the same. I will begin with the brief overview of the operation environment, followed by updates on our business and capacity expansion initiatives, and t hen discuss our performance across domestic and export markets. The global operating environment continues to remain uncertain, with geopolitical developments, supply chain disruption, and volatility in commodity prices impacting business across markets. At the same time, the medium to long-term outlook for manufacturing and infrastructure remains encouraging.
India continues to stand out as one of the key growth economies globally, supported by healthy domestic demand, infrastructure investment, manufacturing expansion, and increasing localization across industries. The continuous shift towards India as a manufacturing and sourcing destination is also creating opportunities for Indian engineering and industrial product manufacturers. For the stainless steel industry, we see structural growth opportunities across sectors such as oil and gas, chemical, petrochemical, power, pharmaceutical, and other process industry. The new demands are also coming from the data center. We believe these trends provide a strong foundation for the industry's growth over the coming years. Coming to Venus, we are building our next phase of growth. We remain focused on building a comprehensive stainless steel engineering platform, combining scale, product grid, quality, and global reach. Our objective is to establish Venus as the first reference and preference for stainless steel engineering solutions.
Over the last few years, we have consistently invested ahead of demand to strong our capacity and our product portfolio. We are now entering an important phase where these investments are beginning to translate into new growth opportunities. Now, I will hand over the call to Mr. Dhruv Patel for update on the quarter.
Thank you, Arun ji. Speaking of the quarter gone by, we continue to see healthy demand across our key end user industries. A key development, as announced on our last call, has been the commencement of our fittings and value-added seamless and welded pipes and tubes capacities in May. We have started receiving encouraging response from our customers for these products. As with any new product category, customer approval and certifications are an important part of the process, and we are working closely with customers across industries to complete these requirements. We expect penetration to improve progressively as these approvals come through and customers start scaling up their orders. We took another important step towards forward integration by entering into pipes spool business with a plant CapEx of around INR 70 crore, backed by LOI from a client in data center segment, as announced in the previous quarter.
The project is progressing well, and we remain on track to commence the spooling facility by end of this year. Venus has been among the early players in the stainless steel pipes and tubes industry to pursue forward integration into fittings and now, spooling. These initiatives are an important part of our strategy to progressively build a one-stop piping solution for our clients. By expanding our product basket, we will be able to address a large share of our customers' requirement, enter higher value applications, and deepen our relationship with clients. We also expect this to improve our product mix over time. Coming to our performance during the quarter, revenue growth was driven by a combination of volume growth and higher realization, with realization benefiting from the increase in steel prices. While higher steel prices supported reported revenues, our EBITDA/ kg also improved.
We also saw a higher growth in welded pipes and tubes during the quarter, w hile the contribution from seamless pipes and tubes also remained healthy. Going forward, our focus will remain on improving our product mix, increasing the contribution from value-added products, and driving operating efficiencies. As our newer capacities scale up, we expect these initiatives to support the quality of our earnings and margins. On the geographical performance, our domestic business continued to witness healthy demand across key end markets. We remain focused on sectors with strong structural demand for stainless steel pipes and tubes, including oil and gas, chemical, pharmaceutical, and engineering, while simultaneously increasing our presence in higher value applications. During Q1 of FY 2027, our domestic revenue stood at INR 227 crore, registering a robust 31% year-on-year growth.
We remain confident about the domestic opportunity and will continue to deepen our presence across existing sectors while also penetrating into newer sectors such as data centers and solar, where our expanded product capabilities can create opportunities for growth. On the export side, we continue to see a healthy opportunity for Indian manufacturers as global customers increasingly look to diversify their sourcing base. Our presence across multiple geographies provides us with a diversified export platform, and w e continue to work on expanding our customer base geographical reach. However, the prevailing geopolitical tensions have created some uncertainty in the export environment. Despite these external challenges, we've seen healthy traction in international markets and secured strong export orders from our key export markets, particularly U.S., during this quarter.
Exports remained robust at INR 94 crore, contributing nearly 30% of our total revenue, reflecting the strength of our product portfolio and customer relations across global markets. Going forward, our focus will be on further diversifying our geographical presence, entering newer markets, and increasing the share of value-added products in our exports. Our investments in capacity, product range, and certifications will help us capture these opportunities over the medium term. Our order book for the quarter also stood strong at more than INR 600 crore, without considering the LOI of INR 185 crore, with a strong mix of domestic and export, reflecting strong demand for our products. Overall, we believe Venus is entering an important phase of its growth journey. The investments we have made across fittings, value-added seamless and welded pipes and tubes, and now spooling, are expanding our product capabilities and opening up new avenues for growth.
Our larger objective is to build Venus into a one-stop piping solution provider and engineering solution provider with a broader product portfolio, deeper customer relationship, and a growing presence across geographies. We remain focused on scaling these new businesses, improving our product mix, and continuing to grow faster than the industry while creating sustainable long-term value for all our stakeholders. With that, I would like to hand over the call to Kunal ji, our CFO, to take you through the financial performance of the company.
Good afternoon, everyone. We are pleased to share that Venus Pipes and Tubes has delivered a record performance in Q1 FY 2027, achieving our highest ever quarterly revenue and EBITDA. On revenue front, revenue from operation for Q1 FY 2027 stood at INR 320.5 crore compared to INR 276.4 crore in Q1 FY 2026, registering a 16% year-on-year growth. The revenue mix for the quarter comprised 55% from seamless pipes, 39% from welded, and 6% from others. Within the core business, seamless pipe revenue grew 15% year-on-year, while welded pipe revenue grew 21% year-on-year during the quarter. Export sales stood at INR 94 crore, compared to INR 103 crore in Q1 FY 2026. Exports were impacted by disruptions arising from geopolitical situations. Despite this, exports continue to contribute around 30% of our overall revenue, reflecting the strength and diversification of our internal business.
Coming to EBITDA, EBITDA for the quarter stood at INR 51.5 crore, compared to INR 44.9 crore in Q1 FY 2026, registering a 14.7% year-on-year growth. EBITDA margin stood at 16.1%, broadly stable compared to 16.2% in the corresponding quarter last year. PAT for Q1 FY 2027 stood at INR 26.4 crore compared to INR 24.8 crore in Q1 FY 2026, registering a 6.5% year-on-year growth. PAT margin for the quarter stood at 8.2%. Overall, we have started FY 2027 on a strong footing with healthy revenue growth and record quarterly EBITDA. The underlying demand environment remains encouraging, and our expanding product portfolio provides us with multiple avenues for growth. With this, I would like to open the floor for questions.
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 remove yourself from the question queue, you may press star and two. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Shubhi Gupta from Trinetra Asset Managers. Please proceed.
Good afternoon, sir. My first question is, what are the utilization levels? Also, are we maintaining the growth guidance for this year, which I believe was about 20%? If you could just answer that first.
Yes, our utilization level at welded is around something more than 60%, and for seamless, it is around 85%-90%. And yes, we are maintaining the guidance at similar levels.
Okay. One more thing, sir. During your remarks earlier, you mentioned that we'll be focusing on improving our product mix. If you could just tell me what is the target product mix that we are aiming for. Is there a specific proportion that we're targeting?
Yeah. Primarily, on the side of welded, we started, in the last year only, we started with the value-added tubing business. That is the area we are focusing to increase that proportion. Secondly, the CapEx what we finished in the end of May 2026, wherein we added quality on the side of seamless tubing business. And apart from that, we also added fitting business in our armory. We believe all this coming quarters to go, we should see the impact of this value-added product.
Okay, sir. Thank you.
Thank you. A request to all participants. Please restrict your questions to two per participant. For more questions, please rejoin the queue. The next question is from the line of Sneha Talreja from Nuvama Wealth . Please proceed, ma'am.
Thank you, team. Thanks a lot for the opportunity. Just two questions from my end. One is on the order book. Did I hear it correctly that you said your order book is INR 600- odd crore, so currently? Which if I'm not wrong, was around INR 450 crore last quarter.
Yes.
Sir, where was this INR 150 crore of addition? Which kind of sectors could you enhance it? Where is the incremental order book? Like, INR 150- odd crore within a quarter is a huge number. Where is this incremental order book, and w hich sectors are contributing to this kind of a growth?
Primarily, it's from power engineering, chemical, and oil and gas.
Understood, sir. Secondly, on the fittings front, what sort of a response are we seeing in the market? Where is the share of fittings at this point of time, some sense? And when do we see our margins inching up? I know you have a long-term guidance of, again, inching up to 18%, 19%, but when do we start seeing our journey improving on a quarter-on-quarter basis? That's second and last question, sir.
See, fittings, definitely, as we are selling pipe to the end customer, typically, many of the end customer will be the same. We are seeing encouraging response from the end customer, but a s it is a very new business, so, again, the requisite approval and process are underway. We believe that from this second quarter onward, a few volumes from the side of fittings should also come into the business. Again, from the perspective of EBITDA, see, we started at the end of May the seamless and fittings business, so I think post second quarter, I believe we should see inching of margin.
Got that. Thanks a lot, team. All the best.
One more thing. Regarding order book, we are having order book of the INR 600 crore in the sector of pipe and fittings sector. Apart from this, we are already having LOI of INR 185 crore for our spooling project. All together, we are having order book of near about INR 800 crore.
That was quite helpful, sir. Thank you so much for that clarity.
Thank you. The next question is from the line of Dhruv Jain from Ambit Capital. Please proceed.
Hi, team. Thanks a lot for the opportunity. First question is on export and domestic mix. While you alluded that you have a very strong order book across t hese two categories, i n terms of FY 2027 mix, how should we think about it? Does this 30% eventually go to 40%, 45% at the end of the year, or any number that you want to share?
See, currently, it should be more than 30%, but from the order perspective, what we had in hand, we have more than 40% or around 45% from export.
Okay. And sir, last six or seven quarters, we've seen that margins have been in the same 16% kind of zone. Now, with the spooling solutions and the fittings is coming through, how should we think about FY 2027 margins and eventually FY 2028 margins, w ith the scaling up of fittings and spooling solutions also coming through? I understand the approval side of things that Dhruv ji spoke about but just wanted your sense there.
The intent is to take it to 18% in coming two years to go. But definitely for FY 2027, it shouldn't be less than 17% on an overall basis. See, third quarter is the quarter wherein we'll be starting majorly on the side of fitting and all, and again, data center will also come in third and fourth, and then, it will be getting spool over coming year to go. Those things will happen over a few more quarters. Then, the margin from all the value-added products will start contributing in the EBITDA.
Okay. And sir, if you could just call out what is the debt at the end of first quarter, and what should be the CapEx number that you are looking at in this year. I'm guessing large part of your CapEx should be [audio distortion] number. Thanks.
Yeah. Primarily, net debt level is around INR 250-odd crore, INR 280- odd crore. What did you say the next?
Sir, CapEx.
Around INR 100- odd crore we are targeting, and net debt is INR 325- odd crore as on 30th June.
Sir, this INR 100 crore would be used to increase which segment's capacity?
See, primarily, the total INR 100 crore, INR 70 crore will be spooling and few fittings and other machineries. INR 20- odd crore, INR 15- odd crore will be towards CapEx, maintenance CapEx and all, towards solar plant. So, between INR 100 crore-INR 110- odd crore.
Okay, got it. Thanks a lot, sir.
Thank you. A request to all participants, please restrict your question to two question per participant. For more questions, please rejoin the queue. The next question is from the line of Bharat Shah from BCS Capital Ideas. Please proceed.
[Non-English content] Arun ji. [Non-English content] broader question [Non-English content] . If we see the composition of our business, we are in a specialty area, and generally, our products have been a better end of the product portfolio profile. It is also evidencing good export performance, generally speaking, over the period of time. But despite customer adaptability, product portfolio, reasonable technology at work, and generally long-term favorable demand conditions, [Non-English content] , that's from INR 400 to more like INR 1,150- odd or 3x . Profit [Non-English content] , but absolute size of the business and absolute size of profit still remains very insignificant. [Non-English content] turnover [Non-English content], somehow sounds a bit underwhelming.
Thanks, Bharat ji, for your concern. But Bharat ji, [Non-English content] you must have idea about the stainless steel pipe industry. In stainless steel pipe industry, [Non-English content] approval and number of things required to penetrate in the market. We have did the capacity expansion after the IPO in May 2022, we had did the almost 3x capacity expansion. We had created our Venus's presence in the market in very well way. Apart from the creating presence, we had expanded our product portfolio also, just like fittings, or we are now moving forward in the spooling solution where you will get the better margin since the in-house product of the pipes and fittings will be consumed in-house or we'll able to provide the customer complete engineering solution.
In the coming quarters, or the after one or two quarter, definitely, you'll able to get the improvement in the bottom line in very significant way, since we are entering into the value-added product or some of the product will be consumed in-house which will give the value addition benefit. Our focus from very beginning, our focus was to be the, you can say key, only player in every segment. We had started our journey simple as a fabrication of the pipe and ERW pipe. Then, we did the backward integration for seamless pipe. Then, we entered into the fittings market. Now, we are entering into the end-to-end solution for the customer. [Non-English content] towards the margin side.
[Non-English content] growth here in the top line. We are almost in the 30% [Non-English content]. Now, our endeavor to growth at least minimum 20% and to improve the bottom line or as well as improve the balance sheet of the company.
Those points are valid. Our products are more value added. Constantly, we have tried to move up the value chain. We have built businesses with international, some demanding customers. Obviously, quality of engineering at work, quality of the product, it passes all those tests. [Non-English content] absolute size of the business [Non-English content]. Doesn't it sound little underwhelming compared to whatever strengths and probably, opportunities in the markets are?
Definitely sir. [Non-English content] This is an engineering business, or this is our patience of our all the promoter. [Non-English content] We are very young player in this segment. [Non-English content] we had the lot of CapEx in last four years. Due to this CapEx and we have taken some of the working capital borrowing to run the company or to manage the working capital, [Non-English content] as we will go into the more value-added product, [Non-English content] the same margin, [Non-English content] 80%, 90%, [Non-English content]. You will see a lot of improvement in that side at the bottom line also.
But Arun, [Non-English content] interest cost is much higher than our depreciation charge. If CapEx and CapEx intensity were affecting the business performance, interest costs wouldn't have been so high. Interest cost, typically, year after year, if you see, is 2x the cost of depreciation charge. [Non-English content] I hope you are getting my point.
Yes, definitely, Bharat ji. Hello? Bharat ji, [Non-English content] top line growth [Non-English content] focus [Non-English content] 20% growth [Non-English content] direct focus bottom line growth [Non-English content] margin [Non-English content] 18% [Non-English content] 18%-19% in the next two quarter, [Non-English content] definitely, [Non-English content] bottom line growth [Non-English content] working and borrowing [Non-English content].
Yes, spooling [Non-English content] project [Non-English content] Ratnamani results [Non-English content].
[Non-English content]
Their spooling business has done phenomenally well. Of course, their pipes business still had some challenges, but s pooling business has a margin of almost 52%. I mean, it was staggering kind of a margin. Do we think that our spooling activity will produce such a major difference like what we have seen for Ratnamani?
Bharat [Non-English content], just not at par of the Ratnamani. Ratnamani has been doing this spooling business since last three years. I will not comment much about that one. But definitely, we are also focusing good margin on our spooling business, except better than the pipe business or fitting business. In the coming quarters, once our spooling business will start, you will see result in two to three quarters.
Spooling [Non-English content], Arun ji ?
End of this Q3.
[Non-English content] big turnover expect [Non-English content] ?
[Non-English content] FY 2027, almost top line of 5% [Non-English content] In FY 2028, I'm expecting top line almost 10%-15%.
Next year, 10%-15%.
[Non-English content] top line [Non-English content].
[Non-English content] L ast question, Arun ji. [Non-English content] overall [Non-English content] . Our backward integration attempts and doing all value-add efforts and given where the opportunity domestically, which is robust, even exports, I suppose, should recover once this model hopefully is out of the way. [Non-English content]
[Non-English content] right now, we are in FY 2027. Almost, I am expecting i n next three years, by FY 2029 or 2030 in between, [Non-English content] business double [Non-English content], but r ight now, [Non-English content] company [Non-English content] capacity [Non-English content] growth [Non-English content] plan [Non-English content] business double [Non-English content] focus [Non-English content] towards margin [Non-English content] that's why [Non-English content] business double [Non-English content] , but margin side [Non-English content] improvement [Non-English content] in next two to three quarters. [Non-English content] pipes [Non-English content] . What's our aim? [Non-English content] pipes, [Non-English content] almost in-house [Non-English content] . In-house, where in fittings, in spooling, in all these business activities. There, you will get the better valuation.
[Non-English content] last year, [Non-English content] by FY 2029 or FY 2030, somewhere in between.
Before 2030.
[Non-English content]
[Non-English content]
And margin should be at least 3%-4% higher than where we are today?
Yeah, minimum we are targeting 3%-4%, but conservatively, you can assume it will be minimum 18%.
Okay. Thank you, Arun ji.
Thank you. A request to all participants, p lease restrict your question to two question per participant. For more questions, please rejoin the queue. The next question is from the line of Deepak from Sundaram MF. Please proceed.
Yeah, thank you for the opportunity. Am I audible?
Yes, sir.
Yeah. Hi, Arun ji. Arun ji, I had a couple of questions. First, we have showcased a good order inflow this quarter for our closing order book to be around INR 600 crore. Just wanted to double-click on that. Where are we seeing those new order inflows coming to us? Means, is it within the existing customer base or is it that we have added new customer in this quarter to drive such a high order inflow? I mean, it is more than what we reported in the last four quarters. Just curious to know, is it within the same customer that we're gaining wallet share or we have added a few more customer this quarter?
Yes.
And most of this order inflow, is it related to domestic market, or it includes a mix of both the domestic and exports?
It's a mix, again, both domestic and export. The order inflow has been good from U.S.A. in this order book of INR 600- odd crore. Again, in the domestic also, again, the customer are mixed, so, t he order from power engineering chemical predominantly from power from the repeat customer also, and few from engineering chemical, from new customer also. There's a mixed bag.
Okay. And fittings, as you already highlighted, we are planning to commercialize this. What kind of revenue are we expecting from the fittings division in FY 2027 and FY 2028?
FY 2027, we're expecting around 5%-7% of the total top line and coming year to go, we are expecting around 10%. Something less, between 8%-10%.
Okay. One last point. Just, sir highlighted that we are looking at a 20% growth, which almost signifies an INR 1,400 crore revenue for us. 5% of that is roughly INR 70 crore and that is what was indicated that we are anticipating INR 70 crore worth of revenue from data center. If I remember correctly, in the last call, you indicated that the order book execution of that INR 185 crore letter of intent is around, I think, 15 months, which basically gives you an INR 37 crore kind of revenue. Since we are executing only for a quarter, I am just curious, where is this mismatch of INR 70 crore top line from data center versus what you indicated earlier that it is going to commercialize only in Q4, which indicates that it would not be more than INR 40 crore.
What we have done is, lot of work on the side of plant perspective has been done on the data center and the customer is quite curious to get it done at a faster pace. We have pulled up many things for the data center, and we are quite hopeful a significant portion, see, t he entire CapEx may overlap to fourth quarter of Q4 FY 2027. But major portion, we are targeting to finish before December 2026. We believe a good amount of top line should also be contributed from data center, and the execution period is basically, you can say, before December 2027. Again, we will try our level best to finish it earlier.
Okay. Thank you.
Thank you. A request to all participants, p lease restrict your questions to two questions per participant. For more questions, please rejoin the queue. The next question is from the line of Dhiral Shah from PhillipCapital. Please proceed.
Good afternoon, sir. Thanks for the opportunity. Sir, this quarter we have seen the growth in the welded pipe segment is much higher than the seamless. If I look at your historical, the seamless have grown much better than the welded. So, what has changed for us in the welded pipe segment particularly?
See, what has happened with us, the seamless was, to a good extent, utilized to the maximum as we added the capacity by the sale end of May 2026. The contribution for the increased capacity will be coming from the coming quarter to go. Again, we have been trying to increase welded, and we have been able to do that in this quarter on the side of welded.
Sir, any particular sector that have given us the growth in the welded?
No, it's a mixed sector again, not a specific one.
Okay. Do you expect, sir, seamless pipe run rate to remain the same since we are running at a full utilization?
With the new capacity, the intent is to get it run at a full capacity, but again, it will not be in the immediate quarter. But each passing one quarter, we believe the capacity utilization should keep on increasing and the intent is to take it the fullest going forward.
Okay. Thank you so much, sir.
Thank you. The next question is from the line of Rishi Kothari from CBA Asset Managers. Please proceed.
Hi. Am I audible?
Yes.
Yes, sir.
Yeah. Thank you so much for giving me this opportunity. My query is around welded and seamless pipes allocation. What sort of ratio for domestic revenue and export revenue for welded product and seamless product individually?
On a blended basis, generally, it is around 30%.
The blended business. You don't have, yo u can't give the output for welded and seamless [audio distortion]. Blended is 80/20, is it?
Yeah.
Blended is 80/20, is it?
Blended, if you take, definitely, the last quarter, seamless was more.
Last quarter seamless was more. What about this quarter?
This quarter, you mean Q1. Q1 quarter.
Any numbers that you want to quote in terms of the percentage?
No, I don't.
Okay. But seamless was more than welded?
Yes.
Okay. Also, on the, of course, when [audio distortion] asked on the new CapEx that we are having going to live for spooling, w e are expecting in Q3 FY 2027 it will go live, correct?
Yes.
Okay. What sort of demand are we looking at in that, sir?
In spooling?
Sorry.
For spooling you said?
Yeah.
Yeah. See, India data center capacity, what we believe was around 1.3 GW roughly in 2025, which is targeting to grow by CapEx around 10.5 GW in coming five years. We believe the good amount of demand is there on the side of data center, which generally, pipes are required for cooling in this data centers, generally known by the name of SFN, its secondary fluid network. We are quite hopeful the robust demand should be there in this line of business. Apart from that, we are working on other sectors also, varying like solar and others. We believe there would be a demand. The company expects a strong demand across several high growth and new sector like data center, power, semiconductor, CNG station-related infrastructure and also, going forward, nuclear energy.
In addition to this, if you see these domestic opportunities, the company continue to focus on expanding its overseas business. We believe with the gradual easing of these geopolitical tensions and normalization, export opportunity are expected to improve further. If you see the combination of this incremental seamless capacity, improving utilization, a favorable shift toward higher margin product like fitting and spooling and demand from these emerging sectors and potential recovery in overseas markets should support, we believe both revenue growth and margin performance over the coming quarters.
Okay. So, you are more or less bullish on that [audio distortion]?
No. It all depends. You also need the geopolitical situation also improve. That should help the company to grow.
Okay, got it. Fantastic. Thank you so much for answering the question. Thank you.
Thank you. A request to all participants, p lease restrict your questions to two questions per participant. For more questions, please rejoin the queue. The next question is from the line of Kanishk Gupta from SS Family Foundation. Please proceed.
Hello. Very good afternoon. I want to know that we want to more or less double our revenues by Q2 of FY 2030, if I'm not wrong. That comes to a CAGR of around 23% versus our FY 2027 revenue growth target of 15%, if I'm not wrong. So, we plan to grow more aggressively in the latest years of FY 2028 and FY 2029?
No. The revenue growth we are targeting is around 20% for FY 2027.
More or less, we will achieve double our revenues by Q2 of FY 2030.
That how we are proceeding. It's primarily a 20% kind of growth for coming year to go.
Okay, sir. Second question would be on what would be your internal mix that you want to achieve in terms of domestic and export revenues in the long term, and the revenues between seamless and welded?
See, again, for the export perspective, the intent is to be above 30%. The intent is that, and again, it all depends how the markets layout, wherein, sometimes, export can please further, but the intent is to keep it more than 30% on the side of export.
And the revenue mix internal targets of seamless and welded?
If you see, sort of near to what currently we are having, the mix should go like that.
Sir, in the export markets where the customers have multiple sourcing options globally, what specific advantages or differentiations lead customers to choose Venus over competing suppliers?
There are many factors why they choose your end customer. See, we are equipped with the entire facility of both welded and seamless. The number of SKUs what we can offer are quite in numbers. Again, with the addition of fitting, they get a forward integration also of the product which we can offer to them. Apart from that, time is delivery quality of product, which we have been doing since last few many years. Those things, the certification, qualifications, and everything help us. Everything in tandem plays to make them win as one of the main supplier supplying in the overseas market. Again, you have a team of people in many of the geographies of the world who are senior people who know the very minor details of these products and business, who also help you a lot in getting these orders and all.
Again, we participate in many of the conferences happening around the world. That also helps where you can display your strength, your products, your technical capabilities and others. Hello?
As there is no response, I'm taking the next question from the line of [Nishita] from Sapphire Capital. Please proceed.
Yes. Hello, am I audible?
Yes.
Yeah. I had a question. We are doing the INR 70 crore CapEx for the spooling facility. What is going to be the total capacity for that?
See, again, these are generally sold on numbers and all, so giving a capacity number on the side of spooling will be quite difficult. But what we believe, this should at least contribute at least 3x of the CapEx in the form of revenue.
Okay, so the asset turn you're saying is 3x.
It should be more than 3x. Yes.
Okay. My next question was like, once we commercialize the facility in Q3 FY 2027, how fast can we ramp it up? Like, you mentioned that from data center, we can expect around 5% of revenue contribution in FY 2027, and I'm assuming that that is coming from the spooling facility only. Is that assumption, correct?
Yes, right. Primarily, post start, the intent is that to ramp it very fast. Again, as you said, we already have a LOI in hand. Things are working as per those LOI and all. We definitely believe the intent is to ramp it very fast. Customer who switched for LOI had also wanted to move it fast. I think this should help us to take the desired number what we are expecting.
Right. My last question is, in FY 2028, can we expect the margins to improve further because the spooling facility will also have the full effect for the whole year?
Yeah, definitely as we said, the combination of incremental seamless capacity, improving utilization, a favorable shift towards higher margin product like fitting and spooling, demand from emerging sector and potential recovery in overseas markets should definitely support both revenue and margin, we believe, going ahead.
Okay. Understood. Yeah. Thank you so much.
Thank you.
Thank you. The next question is from the line of Aasim from DAM Capital. Please proceed.
Yeah, hi, good evening. Just one question. On this revenue target that you just talked about, 20% for FY 2027, can we just break that growth between seamless, welded, and fittings? How would each of these segments broadly grow for the entire fiscal, FY 2027?
Can you repeat?
In your revenue target that you just talked about, 20% revenue growth you are aiming for in FY 2027, what would the growth be for welded, seamless pipes, and for fittings, separately?
The growth would be basically, in a growth percentage we are targeting from both welded and seamless will be around 20% in both the cases what we are targeting currently. From the fitting and spooling, as we said, it should be at least 5% from fitting which should contribute to this top line for FY 2027.
I think approximately for the year, steel prices probably are higher by at least 5%, 6% on average. Is it fair to assume that the volume growth for this year would be 10%-15% at best?
No, if I take fittings, spooling, seamless, welded all together, we believe we should be higher than 15% on the volume front also.
Spooling will not be much in this.
No. Some part of fitting and spooling will definitely come. Definitely, it will contribute in some quantity also on the quantity level.
How much would fittings be on quantity level approximately? Just to get some sense.
It is very, currently, very difficult to say.
Less, right? Okay. Fine. Thanks a lot. That's the only question I had.
Thank you. The next question is from the line of Mahek Talati from Agility Advisors. Please proceed.
Yeah. Hi, sir. Thank you so much for the opportunity. Am I audible?
Yes. Bit low.
Yeah. Just a second.
Mr. Talati, can you please speak little loudly?
Yeah. Am I audible now?
Yes.
Yeah, much better.
Just wanted to understand, you mentioned that in the data center spooling, we have a INR 185 crore of LOI. Is there a possibility of this going further, like we can get more orders here, or this is the highest order we can get?
No. It's very common. Once you are established and you get an approval and all, definitely, we, as a company, believe we should definitely have more orders from data center coming in a way. Once you start your facility, a few demonstrations have been done to the end customer, it definitely help you a lot in getting few more orders. Definitely, we are working towards that only.
Okay. Are there any more customers with whom we are having a chat or inquiries regarding the DC spooling orders, or that will come only after the capacity is online?
That's very common. Again, as a company, we keep on working with a few more customers in the spooling line also. We meant to say, when you have your facility in place, when you start supplying, it adds more push towards the end customer to place an order with us. Definitely, yes, we are working with few others also.
Wonderful. Sir, when can we expect a pickup in the export revenue? We are seeing a de-growth in this quarter. Is growth online from Q2 onwards or it will take some more time?
The intent is to do it in Q2, but again, we all know there are geopolitical and container issues in this quarter, Q2 primarily. A few pickups might be there, but definitely, Q3 and forward, it seems to be more good from the export perspective.
Understood. Sir, does export have a higher margin as compared to domestics, o r because of the increase in freight cost and power cost, overall margins have taken a slight hit this quarter?
Generally, when you are established in the export market, you tend to earn a slightly higher margin. But again, few domestic orders are also there where you can chip in and get a similar margin or sometimes incremental margin. Those all depend on case-to-case basis.
Okay. In the INR 600 crore order book, what is the split between export and domestic?
More than 40% is export.
Okay, understood. Thank you.
Thank you. The next question is from the line of Nikhil Chowdhary from Toro Wealth Management. Please proceed.
Yeah. Hi. Arun ji, thank you for the opportunity. I had just one question. This EU has significantly, probably, reduced the safeguard quota for seamless steel tubes and pipes. Beyond the quota, there is a duty of 50%. I'm just trying to understand, is the export revenue decline attributable to that, or was it just geopolitical? How are we planning to navigate such kind of quotas implemented in the EU?
This is mainly due to geopolitical only. The quota has been reduced by 25% only for Europe. Otherwise, previously also, when the quota was complete, approximately 1,000 metric ton, the export from India was way more than that. If they require anything, seamless pipe, India is best source of supply for them. This was due to geopolitical only.
Got it. But is it impact? I'm sure, like you said that India was exporting more than the quota, so it will definitely impact players like us.
No, I don't think so. Venus has a number of geography. Apart from the Europe, U.S.A., Middle East, in the South Asia also, we are creating our presence. We have our marketings every places. Sometime according to our requirement also, domestic demand, export demand, every place demand. We also sometimes, we used to say no for the order also when we had not much capacities available for that one. Recently, we did the good capacity expansion in seamless pipes segment. After that, definitely this year, you will see growth in the export revenue.
Got it. Understood. Just one more follow-on with respect to the spooling order that we have won. The solution that we will be offering, does it flow down from the CDU? Or what is the product utility in the data center? Is it around the building or will it be flowing down the CDU?
Yeah, it is in the building. The product name is the SFN, secondary fluid network, in the data center. It's inside the building.
Got it. So, from the CDU to the rack, if I understand.
Yeah.
Yes.
Got it. Thank you so much. I'll come back in the queue.
Thank you. The next question is from the line of Dhananjai Bagrodia from Alchemy. Please proceed.
Hi, Kunal. Thank you so much for this. Can you hear me?
Yeah. We can hear you.
Most of my questions are answered. Just wanted to understand about competitive intensity. Are we seeing compression increase when we are reaching out for orders and undercutting, anything along those lines?
See, few people are coming in this business. Again, as we have said, the intent of our diversifying to number of geographies, number of products, and number of world market, we should be able to keep apart from this type of competition. Again, addition of these few products like forward integration to fittings and spooling, so t his will definitely give us an edge to withstand those if something is there more.
But let's say, in spooling now, we have another player which is also increasing capacity. How long will it take for us to get approved by customers for spooling?
We believe, see, it's for new customer, you're asking?
No. Let's say, even your existing customers who use our pipe, if we go to them with spooling, wouldn't they also take time to assess our process?
Yeah, definitely. Each one has their own way of approving. It can take a few months. It can be slightly at a faster pace also. But as we said, even when we start executing this current LOI, it definitely will give the utmost amount of confidence to many of the customer in the country and also abroad. I think that will give a good amount of push to that customer, that they have been supplying the requisite technical capability required for those spooling business. I think that will really drive the future spooling business and all.
Okay, fine. In your current pipe business, just to understand, are we seeing a lot of undercutting? Just to understand how the competition behaves.
Yeah. Bit competition is there, but not as such major.
Nothing.
Under. Yeah.
Okay. Thank you.
Thank you.
Thank you. The next question is from the line of Divyansh Thakur from Finterest Capital. Please proceed. Are you there, Mr. Thakur?
Yes, sir. I'm here.
Okay. Yeah.
Sir, actually, I was not able to get the answer of what is our utilization levels in the seamless segment, in the welded segment. If you can just clarify on that one.
Yes, more than around 60% on welded and around 90% for seamless.
Sir, also, just to adding on that part that we have seen our capacity ramping up for the seamless pipes, which usually contributes around 60% to the revenue. Even after the ramp-up as the utilization with the new capacity, we haven't seen much of the top-line growth, sir.
No, the new capacity, major of the new capacity has started by end of May 2026. Definitely, you will be able to see in the coming quarter to grow.
Okay. Sir, going ahead, do we expect the margins to pick up, sustain, or how do we see it?
The intent is there to get it increased, but again, it's a mixed bag of contribution coming from welded, seamless, and other products. Again, when you add fitting and spooling, those started contributing, definitely the margins will pick from that.
Okay. Sir, any guidance on the margin end for this year, margin side this year?
For coming to where to go, we are targeting up around 80%, which will keep on increasing. Each quarter, you can say a bit portion, the intent is that.
Okay, sir. So, we remain on track for 18% margin till FY 2028?
Yeah. Yes.
Okay. Thank you so much, sir, for answering and all the best.
Thank you. The next question is from the line of Simran Kumari from Narnolia Financial Services. Please proceed.
Hello, sir. Good afternoon. I have two question. The first one is related to volume growth. What was the volume growth during this quarter, and for FY 2027 as well as FY 2028? Had actually, could you just share the specific volume and realization figure for both welded as well as [crosstalk].
No, we are not giving as such those breakup, but on the year-on-year quarter, there is a growth of more than 7% on a blended basis. The [crosstalk].
Can you just share the volume growth for this quarter?
No, it's more than 7% on a blended basis. Targets we are given for each year is the revenue guidance is more than 20% in coming two year to go.
Okay. What will be the capacity utilization trajectory for both welded and seamless for FY 2027 and FY 2028?
It will definitely be increasing. On the side of seamless, we are targeting more than 80%, 85% for both the years. On the side of welded, it will be exceeding 60%, 65%.
Okay. Thank you, sir.
Thank you. Ladies and gentlemen, due to time constraints, that was the last question for today. I now hand the conference over to the management for closing comments. Over to you.
Thank you all for joining us today. I hope we have addressed all of the question. We remain committed to keeping the investment community informed with regular updates on any developments in the company. For any further information or queries, please feel free to reach out to our SGA, our investor relation advisors. Thanks, everyone.
Thank you. On behalf of Venus Pipes and Nuvama, that concludes this conference call. Thank you for joining us, and you may now disconnect your line. Thanks.