Welspun Corp Limited (WELCORP) Q1 2027 Earnings Call Transcript

Ladies and gentlemen, good day and welcome to the Well-Spun Cov Limited Q1 FY27 Earnings Conference Call, hosted by 361 Capital Market Research. As a reminder, all participant lines will be in the listen-only mode, and there will be an opportunity for you to ask questions at the end of today's presentation. 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 is being recorded. I would now like to hand the conference over to Mr. Shailesh Raja from 361 Capital Market Research. Thank you, and over to you, sir.

Yeah, thank you, Manav, and welcome everyone to the call.

We would like to thank Welspan Corp team for giving 361 Capital the opportunity to host this interaction today. Without taking much time, I would now like to invite Mr. Gautam to introduce the management. Over to you, Gautam.

Thank you, Sailesh, and good afternoon, everyone. Welcome to Q1FI27 earnings call of Wellspun Corp. Ltd. On this forum today, we have Mr. Vipul Mathur, Managing Director and CEO, Mr. Percy Burdi, Chief Financial Officer, Mr. Yashavarda Nagarwal, Director, Fintechs, and also Mr. Harsh Rungta, Group Head, Investor Relations, Wellspun World. You all must have gone through the results and the investor presentation of the company, which are available on the stock exchanges and also on our website. During the discussion, we may be making references to this presentation. So I request you all to please refer to the safe hour statement, which is there in our presentation. We'll start the forum with the opening remarks by Mr. Mathur. And post that, we'll open the floor for the Q&A. With that, let me hand over the floor to Mr. Mathur. Over to you, sir.

Thank you, Gautam. And good afternoon to everyone. I welcome you all to our Q1 FY27 earning conference call. As Gautam mentioned, we have already published a detailed investor deck along with our results, which was released on Friday afternoon, which I am sure you would have got a chance to go through. So, today, I would like to keep my opening remarks very brief so as to leave more time to your questions and discussions. Just would like to highlight some of the key aspects to set the tone of this conversation. First, financial. Our financial performance remained robust. We have delivered the highest ever quarterly EBITDA of Rs.756 crore, a 35% growth on a Y-on-Y basis. ROSE has remained well above 20% on an annualized basis. Our net cash position also has further improved to Rs. 2336 crore, and our order book is approximately Rs. 25,750 crore, almost $2.7 billion, the strongest in the company's history, and it provides a robust growth visibility and underscores our exceeding footprint in the global pipeline infrastructure market. Demand side of it, I would like to briefly touch upon the geographies in which we operate in. First, I would like to brief you upon USA, then Saudi, and then India. So as far as the US market is concerned, the demand remains very, very buoyant. As you know, we have booked well through FY28, and we are already seeing clarity emerging on FY29 as well. As we speak, there are multiple projects which are being pursued and followed in the discussion. If we are successful, this could take us to FY29 as well. So the U.S. market with its demand drivers remains the pivot for the growth for the company, and it is looking extremely nice. As regards KSA market, the Saudi market, the visibility in the Saudi market is very encouraging. We foresee a very strong demand building up in the region on the back of the oil and gas and the water infrastructure investments and the reconstruction opportunities which are likely to come up in the Middle East. Also, the recent events which have happened geopolitically are further reinforcing this demand, and we are seeing a very large traction coming up for the linepipe demand in weeks, months, or years to come. With regard to India, So, we have recalibrated our approach in line with the current market conditions, and we have completely shifted our focus. You know, on the ductile iron side, where we have a large capacity in place, and there is a large capacity or an overcapacity in India, we have slightly scaled it down, and we are now recalibrating it with respect to the pig iron, and we are probably one of the largest exporters of pig in this quarter and probably in the subsequent quarters. You know, our strategy has been very clear that where we would like to move. There is money, there is profit. We are not thinking in terms of recalibrating our positions and accordingly. You know, this is a change which we did in the last quarter. But given that we have a diversified portfolio, a global footprint, this continues to be our key strength. It insulates us from one geography or segment-specific headwinds and make our earnings profile far more. Thank you. In addition, a strong emphasis on domestic manufacturing, the Make in India initiative is also driving the demand. As you know, we are the only integrated player in the field, having our own steel-making capacity, our own rolling capacity, and our own pipe-making capacity. I think so this puts us into a much favorable position in days to come, where... We are seeing a strong traction coming up in that particular direction, the nuclear and the power sector. And we are absolutely prepared to cater to that demand. So, structurally, from the availability point of view, and from the research and development, and developments of some very, very niche great, I think that the company has done exceedingly well, and is preparing itself for a long haul of growth in days to come. Coming to the syntax, it is, you know, We see that the Indian domestic market is muted. It is because of that. The syntax is also impacted because of that, because the trickle of the fund is not happening to the ground, and that is where they are also impacted. But we are using this time. We are preparing ourselves for the long haul. This time is going to change. We are preparing at this point in time, we are expanding our customer base, you know, our dealer network, our distribution network, our influencer network on a quarter-on-quarter basis is expanding. We are investing heavily. In that particular fundamental base, we are going ahead with all that of our announced capex, so that we are absolutely prepared when the market rebounds back. We believe that it will be a matter of time that the market is going to rebound, and at that point in time, with our Syntex portfolio, which is an iconic portfolio in our group. to have the maximum benefits coming out of that. At that point in time, when the market rebounds, we do not want to be caught into a cycle that we do not have this or we do not have that. So basically, we are preparing ourselves for the tanks, we are preparing ourselves for all type of pipes. We are preparing for all types of fittings, we are preparing ourselves for the OPVC, and, you know, all that work structurally and fundamentally what is required and is the need of the hour which will gravitate to a future growth of this company is being done at this point in time. So it's a time well being used at this point in time, and I am very sure that this is going to be one of, you know, we would see one of the stellar performances coming up from Syntex in subsequent months or quarters or years to come as the market improves. In terms of our ongoing capex in KSA and Little Rock, just wanted to update that both the projects with Saudi and in America, we have invested heavily for our growth. They are going absolutely fine. There have been some minor disturbances because of this issue, the geopolitical issue. But, you know, we were very lucky that, you know, none of our capital equipments got impacted because of that. We are looking, we are absolutely on track, and, you know, for both the locations, let's say for our project in Saudi, as well as in Little Rock, we are more than confident that both the projects will be absolutely on track, up and running by the end of this year. We would see the full impact of their performance coming up in FYI 2028. The markets are looking very buoyant in both the economies, both the geographies. We would be ready by the end of this year. We would be able to capitalize upon the emerging demand in both these markets, and that will get reflected in our FY2028 projections, earnings, and profitability. Last but not the least, our ESG performance continues to strengthen the foundation for resilient growth and sustained value creation. As a responsible conglomerate, we are clearly focused on our ESG goals. On a year-on-year basis, our ESG ratings have only been going up. We have taken multiple steps. And we believe that, you know, this is the core fundamental, which also has to be focused along with your operations and the market, which is going to create a sustainable value for all the stakeholders and the shareholders in time to come. With this, I would like the moderator to open the floor for the question. As I said, I would like to keep my opening today very, very brief so that we could spend a lot more time in terms of answering all your questions and answers what you might have. So, back to the moderator, please, for opening the floor for any question and answer, please. Thank you.

Thank you very much, sir. 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 handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. We have a first question from the line of Shauri Shah from Equideast Securities. Please go ahead.

Thank you so much for taking up my question, sir. So, first of all, just wanted to ask from the Saudi region. So, some other Indian players, larger guys, organized players are also putting up capacities in the Saudi region. So, wanted to know whether are we seeing an increased competitive intensity in this region given that demand scenario for both line pipes and DI pipes seems to be very strong there. So, that's my first question.

Sorry, good morning. I think that's a fair question you're asking, number one. We also see that, you know, the competitive landscape is increasing in Saudi. I have reasons to believe that it is going to take some time before, you know, these will really start, you know, coming on, their capacities would start coming onto the ground or impacting. Having said that, I don't think so that there is a cause of any undue concern for a simple reason that the market size and the cake itself is so very big enough that I'm sure that everyone would have a reasonable amount of bookings or a reasonable amount of market size to themselves. Let's not forget that, A, we have been on the ground for more than 15 years. I think that gives us a fairly distinct advantage in comparison to the others, number one. In terms of our understanding of the market, in terms of our customer relationship to the market, I think we are better placed in comparison to the others. I am not saying that others will not gain any momentum or they will not gain market share, but I think the market size is big enough to accommodate every one of them. Of course, with us being in a leading position, we will definitely have our share, and I'm sure that others who are also investing in due course of time, as in when their capacities will come up on the table, I'm sure that they will also get benefited out of that.

Oh, great. I understood, sir. And any updates regarding the anti-dumping investigation that was going on for DI pipes in Saudi? So, any further progress there?

Well, there is a significant progress which is happening. Of course, we are, you know, I mean, it is absolutely happening in the right direction. And it is statute by law that, you know, once we have the domestic capacities coming up, you know, the import, the cheaper imports have to stop. I think so. This is what the Saudi law says. And I think so things are moving in that particular direction. And I am sure that by the time our capacities will come in, you know, by that time this investigation on other administrative procedures which are also going on in parallel should also get over, which means that, you know, it will purely.

Just one last question. So, despite the aggressive KPEG, the leverage profile continues to remain very strong for Welspun. So, just wanted to know where do we expect to land in terms of, let's say, repeat net net by F527 and F528, if you could just give some brief numbers there.

Suresh, we have very clearly stipulated and maintained our position consistently that, you know, we operate under particular guardrails. If you see my investor presentation, we have very clearly said our guardrails would be... That, you know, in terms of rosé, we will make it. What we are very, very particular about is our debt to the beta, and So at no point in time, you know, we are going to exceed that. You know, the good part is that all these capexes, what we are doing, you know, they are, despite that, you know, we are still in a very strong net cash position. I think so this is what is the situation going to be moving forward as well. There is a sufficient, you know, free cash flow, all the businesses are throwing. So I don't see our profile getting changed and we don't see our balance sheet getting leveraged. Rather, it will only be becoming more healthier in days to come.

Sure, sir. Thank you. Thank you so much, sir. And just, yeah, sir, just take a question, one last question. So, could you provide the breakout of the India and West business volumes if possible?

We would, that you please kindly take offline as a process. We don't disclose that in a, you know, on the call. But if you have something specific, I think, sir, you can reach out to Gautam and Percy. I think, so, they could be happy to share that, please. I hope you understand that.

Great, great. Okay, no issue. Thank you so much for answering the question, sir.

Thank you, Sadesh.

Thank you. We have our next question from the line of Nitin Arora from AXS Mutual Fund. Please go ahead.

Hi, sir.

Rappanum.

Sir, just one question on this...

Sorry to interrupt you, Nitin. Can you please use your handset?

Yeah, I'm on my handset. Am I audible now? Yes. Okay, thank you. So, just one question on this associate company for what you have proposed of being a 26% stake. Can you tell us what is the rationale behind it and why we are entering into the call?

So that's a very fair point you are raising. We have to create wealth. We have been selling the slag to various people. All what we are now trying to do is to... We are not doing any capital investment for that. You know, the capital investment is being done by some third party, you know, in our premises. We have only taken a sort of small equity stake into that, mandatory equity stake into that particular company. It's at a very notional value, just so as to have a full proper control on that. The whole objective is that, you know, we were generating slab earlier, we will continue to generate slab. We were selling the slab earlier, we will continue to sell the slab. But now, that slab will be converted from waste to wealth in our premises through a third party in which we have an equity stake.

So, the total capital allocation would not increase from here to, from this?

No, no, it is just a notional stake holding we have in that. We are not doing any capital investment into that.

Great to hear that. Second, on your opening remark, the way you articulated demand that you are even seeing visibility for FY29, Thank you. What is the process of where you're thinking now on CapEx for FY29? Because I'm sure the way I'm able to read your opening comment, you know, it looks like rather you're expecting more CapEx from the Saudi and other areas. So can you, we don't want an exact number, but if that can articulate to what kind of a capex you are in massaging, going into FY29, is there a need to upsize the capex from here, is what do you know? And second, given the very strong cash generation, which I think the management has been guiding over the last three years, any inorganic opportunity you see in your business? So just these two questions.

Nitin, in terms of capex, I think so we have disclosed that what are the capex which we are doing in our Saudi business and in our US business. You know, that capex cycle started almost one year back. Almost we are done, we are done with almost 60, 60, 65% of our capex. The balanced capex will get exhausted in this particular year. All that numbers are in public disclosure, number one. Number two, beyond that, we are not committing for any other capex at this point in time. It is now time to have the maximum mileage and the benefit out of the capex what are being done. So, to your question, is there any incremental capex over and above what we have announced? The answer is no, number one. Number two, to your question about the cash generation inorganic, I think so, these are good questions to have. These are, you know, first, as I have always said, we would first like the money to come in our bank, and then these are good problems to have. Let the money be in the bank. I think so, we have a very, very fair... They will be in a position to guide as to what needs to be done. At this point in time, there is nothing on the table.

All the best, sir, and all the best to the team. Thank you. Thank you. We have our next question from the line of Pad Bhavsar from Investec. Please go ahead.

Hi, sir. Thank you for the opportunity and congratulations on a good set of numbers. Sir, I have a few questions. The first one related to demand. So, there are a couple of projects that were announced and or are... Which are announced new. One is like India-Saudi subsea gas pipeline, and the other one is Keystone XL project. So, wanted to get a sense if the tendering has started for these, you know, projects.

I am not aware of anything called India-Saudi pipeline project, to be honest. Pardon me for ignorance on that. I have not seen anything like that, or it might have missed my attention. Generally, it does not, but must have missed out. Maybe you might be referring to India-Oman pipeline or something. That we have seen was being a point of discussion. I think so. If that is what the question is, I think so. It's in the early stages. This pipeline has been in discussion for a fairly long time. There are challenges. It is not an easy project to do, but I'm sure given the geopolitical situation what right now we are facing, I'm sure that this, you know, it might see some light at the end of the tunnel, but it is still. Number two, you are talking about the KXL. I hope you are referring to the North American pipeline. I think in North America, there are a couple of things which are being discussed, nothing in particular called KXL, but there are a lot of different pipelines and different Aftar are being discussed, and that is what I said in the opening remark that such discussions are giving us a sort of visibility that the FY29 demand also could be robust.

Would it be possible to name a few big projects?

Projects generally do not have name in America, if you know. Generally, those projects are being discussed with the midstream companies. They are discussed in strict confidence. Generally, these projects only get a name when they are FID'd. We also come to know the name of the projects at that point in time, what all we have been discussing and the name of the project is X, Y, or Z. Honestly speaking, I do not have a visibility on the name of the projects what we are discussing. All what we are discussing with various midstream companies, multiple projects. And which is giving us a sort of attraction and a comfort that FY29 demand looks fairly robust in the U.S. market as well.

Got it. Got it. Sir, a few keeping questions. In terms of our order book, 25,750 crores, would it be possible to give a U.S.-India split?

We can do that. I think so. Offline, you can take up with Percy and Gautam. They should be in a position to give that split. I would not have readily available, but definitely the path you can definitely have that.

Got it. And, sir, in terms of our KSA capacities, just to, like, you know, get the timelines right, KSA was supposed to come up in Q2, right? Is it being a push to end of Q4, or is the timeline still Q2, FF27?

I think what we mentioned earlier was Q2. Given this geopolitical situation, there had been some minor hiccups here and there, but it has not slipped out. Nothing much has slipped. I think we should still be seeing progress. We are talking about two facilities, and these two facilities should progressively be coming up by the quarter three.

Okay. And then similarly, sir, ERW and ELSA in USA would be Q4.

Yes, ERW in USA is up and running. You know, it has already come on stream. It is up and running. We have commissioned it. We have successfully done all the trials. Right now, you know, the mill has completely stabilized. And now, at this point in time, we have orders, and we are about to start, you know, execution of certain orders out of that particular mill. That is with respect to HFIW. With respect to our ELSO plan, we said that in any case, it will be coming by the end of the year. In FY27, it will be there. We are more than confident that by the end of the year, that capacity will also be up and running. So, pretty much on track.

Got it.

Pretty much on schedule.

Got it. And, sir, just last question to get a sense on KSA. So, how are the order inflows or inquiries for our facilities in KSA?

There is a lot of discussions which we have seen which have started. Earlier, we were all talking that this market will exponentially grow because of the recent situations which have emerged. Now, those discussions are moving into the next phase where the engagements are happening. Then it will move on to the next phase where the tenders would happen, and then it will get to the fourth phase where the awards would happen. So that is a process, that is a life cycle under which it happens. I think it has moved from phase 1 to phase 2, which is a very, very encouraging situation. And it is also reinforcing the fact that what we have been saying that there is going to be an exponential demand buoyancy which is going to come up in the particular market. These discussions are clearly reflecting that.

Got it. And sir, just if I can squeeze in one more. Sorry to interrupt you, Pat.

May I please request you to rejoin the queue?

Yes, thank you.

Thank you. Ladies and gentlemen, in order to ensure that the management is able to address questions from all participants in the conference, please limit your questions to two per participants. Should you have a follow-up question, we request you to rejoin the queue. A reminder to all participants, you may press star and want to ask a question. We have our next question from the line of Sneha from Nuwama. Please go ahead.

Hi team, good afternoon and congratulations on super strong set of results. Just a couple of questions from mine. Firstly, on your margin, this particular quarter, we have seen phenomenal jump in margins. How sustainable these margins are and the order book which you already have in place, what are the kind of EBITDA per time specialty on the US side are we certain of for both 27 and 28?

So, Shania, good afternoon to you. Let's say, to your first question with respect to margin, I think that the way we track, we are not tracking, we are not tracking through margin. See, margin is a factor of raw material pricing versus the profitability of what you do, and, you know, typically the product mix in that particular quarter. We stand by to the absolute EBITDA numbers for which we give the guidance, number one. So, margins, you know, margins are various, it has many variable factors around it. So, I would rather not like to comment on the margin side of it. But, you know, I stand committed to the EBITDA absolute numbers, what we have committed to that, number one. Number two, with respect to the order book, I think it's almost like close to $26,000, $2.7 billion in order book, and which is a very, very strong order book. As I said that, you know, we will be in a position to give you the split between India and the US. I think that's what your question is. I think offline, our earlier participant also asked for that. Mr. Percy and Gotham will be in a much better position to give you an absolute detail about that, that what is that split looking like. But it is heavily loaded towards U.S. at this point in time, to be fair.

So, what I meant was in that particular order book, what sort of EBITDA part-time visibility do we have? We understand that, you know, you have a healthy order book from the U.S. part, so what sort of margins are we making EBITDA part-time on those businesses? And also in terms of order book split, could you give us that, you know, what portion of this order book is driven by the data center, you know, team that, you know, even we are participating in?

Right. So, you know, EBITDA per ton is in U.S. We historically have given a clear guidance that EBITDA per ton in the U.S. are close to $300 per ton. Today, it's an exceptional scenario we are into. So, the EBITDA per ton definitely are much higher than what we have given a guidance. But, you know, you need to, on a sustainable basis, what you need to consider is that the guidance for U.S. is almost $300 per ton. Today, it's slightly more, number one. Number two, coming to the split part of it, about the data center. Right now, the split between the data centers and the LNG going to the Gulf Coast for export, I think the ratios are close to 80 or 20. 80% is still going towards, or 75% is still going to the Gulf Coast for export. 25% is the split which might be going to the data center. I might be slightly very here and there by a few percentage points, but the shift now in years, in the subsequent bookings, what will happen, we will see that this shift increasing. Towards data centers and reducing towards the export side of it. So this is a shift we are seeing out there, but for us, Earlier, we were completely, or the market was completely dependent on LNG export. Now, there's an alternate, you know, consumption pattern or consumption center which has emerged, which is data center, and which is growing on a quarter-on-quarter basis. So, that's a very healthy and a very welcoming sign in an economy which is growing, and, you know, opening up new avenues for us and our investments there.

And lastly, on the order book side, how much is this order book would be pertaining to FY29? Do we have something coming up even there now?

Right now, no. Right now, what we have is mostly till FY28. We would be done pretty much of that. What I mentioned earlier in the earlier questions, we are seeing a good traction for FY29. We are seeing a lot of projects being discussed. Our teams are engaged with multiple midstream companies out there. And, you know, they are evaluating multiple options. It's a long way out, to be honest. FY29 is a long way out, but the engagements have already started. And that gives us the confidence that, you know, it might be sooner rather than later. We may have a visibility, clear visibility emerging for FY29 as well.

That was helpful. Thanks, thanks a lot, sir. All the best, sir.

Thanks, sir.

Thank you. A reminder to all participants, please restrict yourself to only two questions per participant. Should you have a follow-up question, we request you to rejoin the queue. We have our next question from the line of Dhanan J from Alchemy Capital.

Please go ahead.

Hello. Most of my questions are answered. Just one question.

Sorry to interrupt you, Dhananjay. Can you please use your handset?

I don't want my handset. Is it better?

Dhananjay is a very soft-spoken person, so we could see that. Dhananjay, who has that?

Good. Can you hear me now?

Yes, yes.

So, most of my questions are answered. Just one question. So, in Saudi Arabia, there's so much demand. There was an asset available. Did we look at that, which was available to be sold?

Dhananjay, I don't know. Which asset are you referring to, please?

The one which another Indian company had also acquired.

Okay, okay, okay. No, we, see, we continuously scout around for assets. See, you have to understand, Wellspun is a high-quality standard mill, right? We, you know, for us, our reputation, you know, is paramount. And that comes through, that comes through a very, very high-quality product, what we serve, you know, we give to our customers worldwide. We, I'm sure our technical team would have evaluated that, and I'm sure that they did not found it very encouraging in terms of to support that. So, to your point, at some point in time, we did have a look at it, but in our framework, you know, of a quality framework, it probably was not fitting in. So, that's the reason, you know, we did not want it to go ahead on that.

Yes, but wasn't it attractively priced also, but then, you know, like a... Early payback also is on the acquisition.

We are talking here of a very, very heavy engineering product used for very precision sector. You know, you please understand that these pipes are carrying oil, these pipes are carrying gas, and every pipe is very, very critical. You know, you have to have 100% comfort and confidence on every piece of pipe that you produce. Right? So it is not, we are not talking commodity here. You know, and we have a reputation to live to. You know, we are a global scale company. You know, we have built this reputation on quality. I'm not saying it would have been bad or it is not good. I'm not saying that. Don't get me wrong. But it would not be fitting into Wellesman's standards. Valuations and all that stuff, you know, that's not the way we look at the companies. We look at it from purely from a qualitative point of view and our global positioning and, you know, our leadership positioning.

Sure, sir. And congratulations again for Kucharam members. Thank you, sir.

Thank you. We have our next question from the line of Rakesh from Nine Rivers Capital. Please go ahead.

Yes, Rakesh.

Hi, sir. Thank you for the opportunity. Many congratulations for a great set of summer. And thank you very much for the details. I know the report that has come out for the 20th lecture. It's very detailed. I think the industry is up around the floor very well. Thank you very much for that. Majority of my questions are answered. So, this is two questions. First, with respect to the effect of the profitability in this quarter, when you look at the volume growth time by volume growth versus the effect growth for the business has come very strongly. Can we, if I understand the correct, in this quarter, the potential of one of the higher margins, that's why the growth is higher and in the company quarter, the growth in the organics?

Rakesh, I think so, you know, if you see, I have always been a propagandist that, you know, I have always been a propagandist that this company need not to be looked on a quarter-on-quarter basis. I think this is a company to be looked on a year-on-year basis. You have to have that belief that whatever is the guidance given, have we been able to deliver as what we have promised. I think it is very difficult to track this company on a quarter-on-quarter basis because you really do not know what is going to be the product mix, what is the steel arrival schedule, what is your production, what is your dispatch, what is your invoicing, what is your this and that. So it becomes extremely difficult to track it on a quarter. Please understand. All these projects, what we execute are large scale projects. They go over multiple quarters, you know. So, you know, to qualify it on a quarter on quarter basis, I find it extremely difficult. Howsoever I wish I may try to do that. I am unable to do justice. So please understand my position kindly. Look at this company on a year on year basis. And if you have any questions, any doubts, any point around that, I will be more than happy to address that, please.

That's all. Thank you.

Thank you. We have our next question from the line of Vikas Singh from ICICI Securities. Please go ahead.

Good afternoon, sir, and thank you for the opportunity. First of all, very congratulations on very good setup number. Sir, my question is slightly on a long-term perspective. As we have seen that nowadays, the major oil-producing countries like Middle East or U.S. prefer the localized production, and that's why we are putting plants in Saudi as well. Going forward, Indian capacities have always been more towards in the export segment. So just wanted to understand going in the next three or four years forward, do we see further Indian capacities getting shifted to other geographies? And if not, then what are the other pockets where we can actually utilize these capacities as the Saudi will get more capacities and more demand would shift in-house versus the imports?

Very good afternoon and good to hear from you. It's always good to have. I will not be in a position to... Keep in mind, see. The local culture, the local dynamic. I think so, it takes its own time. It has its own. You know, why we have been slightly ahead or successful, if I may say so, because we were present in both the geographies, let us say, in America as well in Saudi for the last 15 years. It is not that we had a supplier relationship that we were only producing in India and supplying there. We were physically present on the ground. We understand the nuances much better than others would have it. Not that others will not be able to do it. Thank you. They were more inward looking. They were more servicing a domestic requirement. Now, the domestic requirement definitely is receding at this point in time. At least there is a little lack of visibility and, you know, the spend which is going to happen there. So, India market is slightly muted. I am sure that, you know, everyone would be trying for export at this point in time. I believe that. But you also have to understand that as it is difficult to set up a green field or a brown field capacity, also you have to understand that getting approved Approvals and accreditation is also a challenge. You know, if you really have to work with the tier one producers of the world, there is a process of approvals and accreditation. There is a, you know, there is a very high quality standards which are required absolutely to a scale, you know, which are very, very difficult to achieve. So that is also, so there are deterrents to get into that. It is a time consuming process. And this is where Wellspun is slightly blessed, because with all our approvals and accreditions, which are global in nature, and with the tier ones we already have, you know, that is giving us a sort of a head start over the others, and our geographical presence into the other markets is giving a head start. I am sure others will also be trying to do that. I wish them all the success, but it is not as easy as what we contemplate at this point in time.

Noted, sir. So, my second question pertains to our cash utilization. As we like to maintain our ROC at 20% or above, cash is becoming a problem because we already have a pretty high cash position, and I believe that it is going to increase only further. So, deployment of this cash, any thought process on that, if you could share with us, would be really helpful.

Because, you know... First and foremost, today we all recognize cash is king. I think there is no ambiguity around that. So it is a good problem to have, first and foremost. But I completely understand that in a way it is also counterproductive. We are very clear that its deployment has to be figured out. Now whether it is by virtue of dividend, buyback, investment, all those things are very well understood at our end, number one. But we strongly believe that right now we have a decent amount of cash, but we are still into the capex cycle. But we also believe that in the subsequent quarters, you know, there will be a more cash flow which will come in. And we will be sitting by the end of the year at a substantial amount of cash. And I am sure that by that point in time, we will have figured out an answer. There are multiple things which are being discussed. And I only want to assure one thing. See, at the end of the day, you know, the capital allocation is going to be extremely, extremely judicious. We are very, very clear, and if you see for the last two years, we have very clearly given our guardrails. Our guardrails are that we will go into our proven geographies, core geographies and core products only. You know, number two, we will only invest where the roses are more than 20 percent. Number three, that at no point in time, we would see our net debt to EBITDA going up beyond, it has to be under 1 percent. We will do any capital allocation and I do trust you.

Thank you. That's all from my side, and all the best.

Thank you. A reminder to all participants, please restrict yourself to only two questions per participant. Should you have a follow-up question, we request you to rejoin the queue. The next question is from the line of Nishant Was from 361 Asset Management. Please go ahead.

Yeah, hi, sir. Thank you for the opportunity. There's just one question digging into the U.S. North American Data Center potential. I think there is a lot of discussion, even in the U.S., that they are going to fall short of the natural gas generation capacity for the data center side. Like, close to 100 gigawatts has been under development, but approved list is much smaller. I think you're obviously talking to a lot of midstream guys, and they are doing what they can, like Alexa, Enbridge, Atmos. They're trying to do whatever they can. The fact that you have capacity coming on stream, you're in the unique position. Is it possible for you to kind of be nominated directly from some of these customers for some of the larger programs coming up? Because I think the window for some of these programs to get initiated is probably less than 12 months. If that is the case, you mentioned you have no new plans of CapEx, but I'm just trying to think from your management's advantage. If your capacity gets completely booked for, say, potentially 29 as well, what's the lead time for a new plan? I'm just trying to think that from your vantage point.

Nishan, thank you. Nishan, I think that's a very great question. See, first and foremost, to set up any plant in America is You know, for someone like us who is present there, who is already on the ground, it's at least an 18 to 24 month process, first and foremost. If someone intends to even do a green field part of it, I do not know what time it will take because, you know, everything is on fire in America. So, is there a threat of any new capacities coming up and if someone would like to explore, good luck to them, but I don't think so that, you know, it is something which someone needs to venture about because things are not as what we see from here. Number two, you know, we also believe that, you know, there is a tipping point. We could see a demand, you know, we are seeing a very structural demand for the next five to seven years' time, right? Out of which we are only booked for two years' time, and maybe potentially we can, you know, as the things will progress, we can book for another year or so. Even if we start thinking beyond adding our more capacity, which we don't want to do that, I think it is beyond a tipping point because overcapacity is also detrimental into a market which is growing. So we do not believe, I think so right now, right now we believe in the US, the type of capacities what we have and the type of capacities our competitive landscape is having. I think so with that, it has reached to a point that there probably is no need to add. If we really want to see the momentum, if we really want to see the margins. of a general sense I am getting, and in any case, you know, any newcomer putting up a plant is next to impossible, it is not possible, and even if someone ventures, he is going to bleed that. So, I think, so, from a capacity point of view, Everyone seems to have reached to a certain optimization level. Let's not forget that we are also a project business. This is also a cyclical business. All what we are seeing is a five, seven years of a sustained growth. But then if you have an overcapacity, then this, you know, that also comes and bites you at your back, you know, when the sun is not shining that, you know, the sun is not as shiner as it is now. So we are very clear that at this point in time, we have done what we need to do. We have positioned ourselves. We want to maintain our leadership position, which we have. We want to have a particular market share, which we have. We will continue to maintain our market share. That's what we have invested for. Beyond that, we are not looking at anything at this point in time.

Thanks for that clarification. So can we then assess the fact that I'm not comparing it like to like, but there was obviously similar shortage on the data center build-out from memory. And I think if CAS becomes a, let's say, a roadblock for growth in memory, could you, is there a pricing level which you can extract from the customers if you talk about margins? I think then there is a much larger headroom for margin expansion in the U.S. if. If some of the things that we talked about, data center build-out happens for you guys, is that understanding correct?

That's a fair understanding. I think so the margin profile has been increasing. It has been what it was two years back and what is it for now and what is it going to be in future. I think so the margin profile incrementally has been better. And please understand, on the other side of the table are intelligent buyers. They completely understand that. I think so the name of the game is all about how... How quickly they can be, how quickly they can be into the particular market and how quickly they can be served. And that is one of the USP what Wellsman bring up on the table. And that has helped them to be quicker into the market. And at the same time, they have rewarded us with a margin expansion. So it's a two-way process. It is very, very open, transparent. And that is the strength of that particular market.

Super. Thank you so much and all the best.

Thank you.

Thank you. We have our next question from the line of Netra Deshpande from Mary Asset Sheikhan. Please go ahead.

Good afternoon, sir, and thank you for giving me this opportunity and congratulations on the great set of numbers and the new record level of Global Order Book. My first question is pertaining with the DI pipes. As you have slaps about the funding constraints under this GELD-1 mission, impacting the domestic mass-fighting demand, which is like the strategic power shifting towards bigger and exports more this time. So can you quantify the current exports against and what would be the sustainability about this strategy as a margin revoked?

So, Ms. Dispander, you are right. I think the domestic demand for DI, which was under Jaljeev and Mishank, is under severe pressure. And we see that it is going to be there for a significant longer period of time. You know, we were expecting that things in H2 should improve, but the way I think the priorities are changing, for valid reasons, I completely respect that, looks like that this is going to be a sort of sustainable, a pain for a sustainable period of time. So all what we are trying to do is recalibrating our complete strategy. While we will continue to focus on our DIP business, there is still a market. We are still, you know, we are still a large player of DI in the DI market. We will continue to focus the domestic market. We will, we have an advantageous position on servicing the export market. But both the domestic and export market, apart from that, it will also give us an opportunity to, you know, to do some big exports. And that's what we have opted for. At the end of the day, the bottom line remains that we remain, despite the challenges which are there into the domestic market, we still need to be very profitable. So that's the strategy which we have calibrated our change to. I think so this is the right strategy, a domestic presence, export focus, and a blend of pig iron coming into play. And I think so that these three things put together will continue to give us a margin profile what we are looking at.

Okay, okay, okay, sir. And my last question is about the runoff deal, that is, of Epic. So, about this, I would like to ask about this post-partial Epic take sale. What would be the residual shareholding in Epic as any other monetization which is planned or as this is a runoff deal? So, that has shown a good amount of exceptional gains this time in this quarter. So, this is the question put in. Yeah.

So, Mr. Vande, our, you know, EPIC is a strategic asset for us, right? And, you know, while we have been slightly diluting our positions here and there, recently being 4.5%, but after that also we have more than 22% of the share, 22% shareholding out there. We are still the largest shareholder, and we will continue to be the largest shareholder, number one. It is a very strategic fit for us because, you know, it offers, you know, Epic and our 100% stuff which is coming up in Saudi. I think so these two companies put together bring a sort of a very unique portfolio on the table which is unparalleled. So, you know, we will continue to invest in Epic. We have no further intentions of diluting it. This 3 or 4% dilution, what we have done, was done with a very specific purpose, with a very strategic intention, and throwing that money. Bringing it out from the Saudi market and employing it in the Saudi market only. So it is not that we are bringing that money home or we are taking it anywhere else. We are only divesting and investing into the Saudi market so that our portfolio, the comprehensive portfolio between EPIC and the Welspun becomes such a formidable portfolio and that becomes the key driver for our growth in years to come.

Thank you. A reminder to all participants, please restrict yourself to only two questions per participant. Should you have a follow-up question, we request you to rejoin the queue. The next question is from the line of Retesh Shah from Investec. Please go ahead.

Hi, sir. Thanks for the opportunity. Sir, first question is, why is it we are not increasing our full year guidance? Because specifically when we look at midstream owner operators, I think all of them are actually doing well. They have also increased their guidance for the full year. Any specific reason to be conservator?

Ritesh, very good afternoon to you. I think so. I mean, that's our philosophy. We don't want to revise our guidances. We have given it the start of the year. We are into a project-based business. Did anyone anticipate this war will continue like this? Nobody, right? Is it sustained to this particular period? Nobody. I think so there are events which keeps on changing over a period of time on which you have no visibility to. So I think so it's not prudent on our part to keep on changing the guidance. What is important is to give a realistic guidance, number one, and work hard in terms of achieving that or exceeding that. If you see the track record in the last four years, whatever guidances we have given, we have always met them if not exceeded them, right? And in those period of 12 months, you know, so many things geopolitically keeps on changing, which you have no control on. So I think as a philosophy, we believe in giving a realistic guidance, not creating. Disappointment, rather, you know, bringing truthful thing on the table and

Sir, if I just flip the question around, saying, like, probably you're not changing the guidance because we already have the order book, which is fixed. We know the volumes. We know the profitability. Probably that might be a reason we are not changing it. But, sir, if I have to just ask you a question, you did point up on FY29, some visibility incrementally emerging. Given the situation that we are in is quite strong, what is the threshold when you are saying no to orders right now? Because I think in one of the prior questions you did indicate for U.S. we are making more than $300. $300 was a normalized average historically. So, is it that we are saying no two orders have our thresholds on ROC, mood up? So, you did give a number of 20%, but is 20% number higher at this conjecture?

T. This was relevant when we were talking of FY28. Right now, when we are talking of FY29, you know, their discussions are at a very early stage. Because, see, you also have to understand that, you know, for me, we also have to have a very clear-cut substrate strategy, which is a steel strategy. So it is not an easy answer to, you know, to commit immediately for FY29. You know, for any steel suppliers to also commit for FY29 assured delivery at a fixed pricing also becomes equally challenging. So it is not a one data point discussion. It is a multiple data point discussion. We, our capacity, availability, number two, the steel guys, what are they thinking about it, and the total demand into the market. I think so, these three points, we triangulate that, basis that, what is the right fit for all three, you know, right fit for Wealth Point is basis that we take a decision. We have, basis that we have taken decisions till FY28. Right now, as we speak, we are triangulating these points, coming to a broad consensus for FY29, and the good part is that, what I have been saying, that the good part is that at least the discussions for FY29 has started. But have we triangulated the strategy? Have we reached to a broad consensus? I think it will evolve over a period of time. We are in no rush. We are in no hurry. But we have a very clear objective that how can we improve our margin profile as what we have over F128? So it is with that objective. We are working around that. Have we reached to any conclusions? The answer is no. But I am sure that we will get there sooner rather than later.

Sir, just one follow-up. When we say 24,750 crore of order book, is it possible to put a value on tonnages over here?

Value of? Sorry, I didn't get your question.

On tons. So, the reason, so 24,750 looks beautiful because of Section 232. Steel pricing, obviously, is very high in U.S. So, if we have to look at it from a, how should we look at it?

Look at it from absolute value. This is what is going to happen over the next two years' time.

Why should you… Volume, volume. I'm looking at it from a utilization level standpoint as well. So, is it possible to quantify it in a volumetric basis?

That is difficult. Difficult because it also has other businesses embedded into that also, right? The India business is also embedded into that. You know, the futuristic, you know, there's some WSL. So, it is difficult. I'm not saying that it cannot be quantifiable. It is not quantifiable, but it is difficult. But you have to understand, where do we stand? We stand that we give a guidance that, okay, guys, this year our turnover is going to be like this and our EBITDA is going to be like this. I think that is what we are focused on rather than volumes or the percentage because the more variables you like to bring into the play, the more confusion we create. So we want to be very clear, very straight, very upfront and very transparent that this is what we are committing, this is what we are delivering. If we can do better, trust me, you will not leave any stone unturned. And that confidence you will be having on this team and on this management.

Sure, sir. And, sir, just last question quickly. You indicated, sir, sorry to interrupt you, sir.

May I please request you to rejoin the queue?

Sure.

Thank you. Ladies and gentlemen, please restrict yourself to only two questions per participant. We have our next question from the line of Yash Seidani from Integrity Ventures. Please go ahead. Yes, are you there?

Hello. Am I audible?

Yeah, good afternoon. Yes, you are.

Hi. Congratulations on the great setup number, sir. Just on volumes, I understand you said we shall not look at volumes on quarterly basis. But, if I compare this on a quarter and quarter basis, we are seeing a volume degrowth. So, is there any reason for that or the orders are getting antiquated in this quarter? That is the reason for this problem.

As I said, yes, you know, this volume degrowth or growth is a factor of what you are producing in that particular quarter, right? I really do not know that, you know, whether it is a degrowth. I don't think so. It will be a degrowth, but assuming for a minute it is a degrowth, that's specifically validating my point that I do not want to discuss on a quarter-on-quarter basis. We really want to discuss it on a year-on-year basis for a simple reason that you really do not know what product mix you are running, what type of sales you are booking. You know, that sort of a visibility, that sort of a granular visibility is so very difficult to predict on a quarter-on-quarter basis. On a yearly basis, we know that, okay, this is the volume we are able to do, this is the top-line revenue we are able to do, and with the steel completely heads and the margin profile what we have, we are able to give a clear guidance on the EBITDA number. At least we would like to keep it that way. We would not like to comment on quarter-on-quarter growth or degrowth basis, please.

The second question would be on... You are basically a domestic business. So, since you mentioned domestic business has seen market demand, but we have seen that Syntex business has seen negative margins and margins are increasing negatively. So, how are you looking at that number, specifically?

No, no, no. Please do not see syntax margins as negative. We are, you know, this is an iconic brand, number one. Number two. You know, and this is a B2C play, right? I am heavily invested into branding and marketing. You know, there are three things fundamentally we will do. Number one, we will continue to expand our base.

We have our next question from the line of Sohan Joshi from ASC Consultants. Please go ahead. Am I audible, sir?

Yes, Sohan. Good afternoon.

Sir, my first question is with regard to the expansion of east-west pipeline by the Saudi Arabia to the Red Sea, so that they can transport the oil surpassing the state of Hormuz. Is this discussion gaining any momentum? I mean, are you aware of these discussions?

So, Han, we are, number one, and what we are hearing and what we are seeing on the ground are two different realities. What we are hearing is much less than what is happening on the ground. Definitely, East-West is a very active project which is under discussion, and I think a lot of steps, you know, the government of Saudi Arabia and especially Saudi Aramco is taking with respect to that, but we should not look East-West only in isolation. East-West is only one part of the strategy what they have been talking. I think so, you know, there are multiple lines which they are talking at this point in time, multiple argumentation of capacities what they are talking. And as I said earlier in the call, earlier there was an internal discussion, now they have moved to an engagement stage. Thank you. We will discuss internally within government and Saudi Arabia. various stakeholders on the table, and that is reinforcing the trust. So it is one, East-West for sure, and apart from East-West also there are multiple things being talked about, or engaged about.

Okay, thank you. My second question is, there are some reports, and of course, it was even highlighted by President Trump, that some of the data centers in the U.S. are getting shifted from the city area to the rural area, because there were some protests from the citizens, and even President Trump, you did about it. How are we seeing this affecting our demand? Is it going to increase since the location of the data centers itself has changed?

Same. A. Data centers, typically, to the best of my understanding, they were never coming into the cities. For a simple reason, that the large cities cannot accommodate this type of data centers. So these data centers were typically moving towards more on the rural side of it. Always. They were always, that was always the case. Now, there could be one or two which would have further moved, for which this noise would have been coming. I'm not private to that. But at least all the data centers are coming in Midwest and, you know, in the Arizona region. And because, what you need there, you require a huge land parcel, number one. Number two, a lot of water. And number three, a power connection. Now, the cities have... They don't have too much of a land space. They cannot give you that type of water, which is required. And in any case, all the cities are on the grid. And the grid infrastructure in America is so fragmented that if they start giving power from the grid to the data center, the grid could collapse. So all these three factors are deterrent. Everyone in the data centers are aware of it. And that is the reason they are all moving to Midwest, Arizona regions and all that stuff. And I think so that growth with what we have been talking, what we have been hearing, the growth is much more than what we have been hearing about. I think so the way they are coming up on the table, the way their demands are going up. I think so what also needs to be seen, Sohan, is another data point to track is the turbines, the gas turbines. Just to give you an example, two years back, the gas turbines. You know, there were hardly 5 or 7 or 10 gas turbines which were sold in America, right? This year, if you look at it, the order book is for more than 300 gas turbines, and this is a demand for the next 4 or 5 years. So, if you look at that data point also, it is very clearly giving indication that, you know, this business of data centers is going to exponentially grow, and where these turbines fit, because these data centers will have their own power plant, each power plant would require those turbines, and of turbines, incremental exponential growth in turbines is also giving a very clear indicator that this Thank you. This is an integrated part of a...

Thank you. Thank you so much for the in-depth explanation. And all the best for the future partners. That's it for my friend.

Thank you. We have our next question from the line of Deep Gandhi from I Thought PMS. Please go ahead.

Yeah, good afternoon, sir. So first question is around again on the data center side. So I think one of the previous participants you had mentioned that in terms of the new order inflow, the share of data center orders is increasing. So can you quantify that, I mean, in the pipeline or for the incremental orders, what share of the orders you are getting is towards data center? And similarly, I mean, also on the margins. So are the margins higher in the data center order or are they broadly similar to the oil business?

Deep, I think so. I have answered both these questions. I'm sure you are listening to this call since it started. Both these questions I have already answered. I don't think so. There is point repeating those answers, please.

I think you haven't shared in terms of incrementally what percentage of orders you are getting from data center. You have given a sense that the share is increasing.

I did say that currently our portfolio would have something like 75-25, but I think so in times to come, we are seeing more traction and this portfolio might change. That's what I answered.

Actually, I was looking for a number. If you can share what can be the numbers two, three years down the line in terms of future order influx from data center. That is what I am trying to understand.

Difficult. Difficult to predict. Difficult to predict for us at this point in time because at the end of the day, it is also about timing. Now, on a given time frame, you know, there is a demand coming for data center and on the given same time frame, there is a demand coming for an LNG export. I am not the one choosing for that, right? I am the one choosing for my, you know, what is the right mix for me to produce at that point in time with the right margin. I would love to do, I would love to do data centers as much as possible. Why I am saying data centers need to be seen? They need to be seen as an opportunity, as an alternate opportunity which is coming up on the table. So, which is giving a sort of a very long visibility about, or horizon, about this line pipe demand for the next five to seven years time. I was talking, I am talking data centers from that context.

And the second question is I think few weeks back we had 1,600 crores orders for export from India. So can you give us some more sense around with geography? Are we going to export this order to? And I mean, usually the understanding was India plant was meant mostly for domestic use. So I mean, are we seeing any new opportunities where the India plant could be used more towards export also? Are we seeing any more such orders in the pipeline?

See, India has three types of plants. Number one is our ELSO plant. Number two is our spiral plant. Number three is our HFIW plant or the ERW plant. And number four is the DI plant. What I am talking here is the India domestic demand being big, which means it will impact my DIP, it might impact my spiral. But our ELSO was always export. So the export demand out of India is always going to be robust. It was, it is, and it will be. So, if you see on a year-on-year basis, we export almost 150-200,000 tons of pipe, which we export, which are primarily ELSO. Not primarily, which are 100% of them are ELSO. That demand is very strong, that will continue to be strong. We have a large, see, we are servicing the export market here in Middle East, we are servicing in the Southeast Asian market, and now we are extending our footprint to the Caspian region. So these are the three markets in which our India, you know, India has been supplying the pipes in the past five years, and it will continue to do so in the next five years. For a simple reason that the oil and gas, you know, invent, invent. We are servicing the demands in the Caspian, the Middle East, and the Southeast Asian region. So that demand is there.

Thank you. We have our next question from Lino. Paz Bursar from Investec. Please go ahead.

Thank you for the opportunity. Just one question, which is on approval. So, once our new capacity is commissioned KSA in USA, typically how long does it take to get the approvals from Tier 1 developers, owners? Do these projects go through a full, fresh technical approval cycle for the new product or facility, or does our existing track record and company credibility with clients helps to fast track these approvals?

I think the latter statement is the most appropriate statement path. I think so, typically the quality management systems. What is one bothered about? Everyone is concerned about the quality, right? So, the quality management system, we have a global quality management system. You know, we have one quality policy, wherever in the world we operate, it's the same one. So, nothing is going to change. Number two, our relationship with the customer, our, you know, our past supply track record. I think so, these are all factors which only completely accelerate. So, for us, if getting, once we are absolutely installed, erected, and commissioned, getting approvals is a matter of weeks, not months.

And that won't be the case for competition, right?

I don't know. It should not be the case.

Got it, sir. That was my question. Thank you.

Thank you. We have our next question from the line of Arun Chonali from Freshwater Capital. Please go ahead.

Hello. Thanks very much. Just one quick question. I think I missed it. But which particular pipe is going into these data centers? Which is the type of pipe?

Sorry, Arun. Can you repeat the question, please?

Sorry, which type of pipe? Is it stainless steel? Is it HSO? Is it LSO? Which is the type, the pipe, the specific pipe that's being used in these data centers?

Both. Both. Both spiral as well as LSO. Two things you have to take note of. See, data centers are now coming in hinterlands, right? Now, they have to cross. People, urban areas. The safety code requirements are very different than when you are taking it from the Permian to the Gulf Coast because that particular corridor is not that habitative, right? So depending on what area it is, how much is the habitation in between, what is the safety code which is in application, that is determining spiral versus also. So we are seeing a strong... It is because the pipeline passes through a much thicker habitation area. So that's the impression we are getting. But to your question, whether both the pipes are acceptable, the answer is yes.

Got it. And, I mean, this is for the U.S., but there was also a large data center announcement in India. So I don't think they've fruitioned as yet, but one would suspect that this would also create demand.

It should. It should. But the good part here is that, you know, there is already a gas grid which is in place, number one. Now, I think to the best of my understanding, you know, these data centers will be hooked to this gas grid, the national gas grid, right? Instead of they developing an independent line to their data centers, which is the case in the U.S., I don't think so that that will be the case here in India. There will be a requirement, they will like to go to the national gas grid, which is where companies like Gale participate, and we are seeing that in their forecast, they are indicating that they want to add at least 10,000 kilometers of pipeline to complete the gas grid. So this demand, I am sure, will come at an appropriate time.

Love it. Thanks very much.

Thank you.

Thank you. We have our next question from the line of Ritesh Shah from Investec. Please go ahead. Ritesh, are you there?

Yeah, hi.

Sorry.

Sir, I'll just start where we left. Sir, you indicated securing a substrate is something which is a challenge, say, for FY29 order book. Sir, how are we going about it then? That's first. And secondly, are there any regulatory policy challenges that you foresee which could actually derail the train where everything is going right at this point, sir?

So, Nitesh, to respect to substrate, I think it is a sort of a joint approach we follow. When we work with the local steels or liars, we enjoy a credible relationship with them, and there is nothing called speculative. They have their skin in the game. So, I never said that it is going to be a challenge. I am saying that it needs to be strategized. All, you know, as we are discussing requirements for, we just concluded for FY28, now when we are getting into FY29, we are putting, jointly putting together a strategy, what should be our strategy for FY29, and that means along with the skills guys as well. So, I don't think so it is a challenge, but there is a work to be done, number one. Number two, regulatory policy and challenges, yes, there are challenges, but those challenges will be to the imports. See, one thing is we are very, very clear that in America there has been, we have seen certain imports still coming in, you know, small diameter or someone had adventured and, you know, small quantities of large diameter also trickled in. I think so that will stop. Absolutely plugged into the government, to all the regulatory authorities and the bodies out there. Earlier, there was no capacity, no capabilities available there. But now, when in America, all the capacity, the full capabilities are available. So, it is only a matter of reinforcing. I think it has to come to the call.

Sir, last question. I'll just put a hypothetical scenario of Section 232 and 301 is completely rolled back hypothetically tomorrow. How does the nature of operations, how does the economics change for us?

Two things. Number one, both 232 is by statute of law. It is not that by statute of precedent. It is by statute of law. So it cannot be rolled back, first and foremost. It has survived two terms of two different parties. So I see no reason whatsoever that this is going to roll back. For a simple understanding that in U.S., they completely understand there are three or four pillars of U.S. economy. Automobiles, oil and gas, steel, tech. These are three or four pillars they completely understand. There is a bipartisism support around all these four things. I think they are formulating and they have formulated an ecosystem that anything and everything has to be around that. So with the bipartisism support which they have in the Senate and the Parliament and through legislation, it is impossible to roll back something like this. You know, things which can be, things which have an impact are the stack-up duties here and there. So, they, you know, they are marginal in nature. So, they are not going to move the needle. But if that 232, which is a cornerstone, which is 50%, that is not going to go away anywhere. For sure.

Sure, sir.

Thank you. Thank you. Do we have any other questions left?

No, sir. This was the last question. Ladies and gentlemen, that was the last question of the day, and I now hand the conference over to the management for closing comments. Over to you, sir.

Yeah, thank you. Thank you, gentlemen. Thank you all for participating in this call. I think so. We try to answer most of your questions. I still feel that, you know, if there are any further clarity which are required, you can definitely reach out to Mr. Percy and Mr. Gautam to get those answers. But fundamentally, what I am trying to tell you, gentlemen, that, you know, that, A, the company, your company is on a very, very strong wicket. I think so. Our performance is a testimony to that. Our future order book also gives you a clear visibility as to what is going to happen over next 10 to 12 quarter time and maybe even more. The market, we are seeing the tailwinds into the market. We are present into those markets where the tailwinds are there. You know, it is definitely going to offset some setbacks what we might have in the Indian domestic market, but, you know, they are going to be largely offset by miles into the geographies what we are present, and I am sure that the best of the company is yet to come. So continue to have your trust, continue to have your faith, and we look forward for all your support, what you have given us till date. Thank you very much for joining us, and all the very best. Good day to you.

Thank you, sir. On behalf of 361 Capital Market Research, that concludes this conference. Thank you for joining us, and you may now disconnect your lines.