Ladies and gentlemen, Good day and welcome to the Q4 FY 2023 earnings conference call of Ratnamani Metals & Tubes Ltd hosted by Monarch Networth Capital. As a reminder, all participant lines will be in the listen-only mode and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing star then zero on your touch-tone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Sahil Sanghvi from Monarch Networth Capital. Thank you and over to you. Thank you, Yashashree. Good evening to all. On behalf of Monarch Networth Capital, we welcome you all for the Ratnamani Metals Q4 FY 2023 earnings call. We are delighted to host the management of Ratnamani today and from their side, we have the business, Carbon Steel business head, Mr. Manoj Sanghvi and CFO Mr. Vimal Katta. W ithout taking any much time, I will hand over the call to Mr. Manoj Sanghvi for the opening remarks. Thank you and over to you, sir. Thank you, Sahil. Good afternoon to all the participants. I welcome you all to this call and hope everyone is doing good. Our results for Q4 and full year of FY 2023 have been uploaded on the exchange and I believe you all had the opportunity to go through the same. If you see on standalone basis, our company clocked its best ever performance in FY 2023 with the top line and profitability at historic highs, both crossing INR 4,400 and INR 500 crores respectively. The operating margins were broadly in line of our guidance provided last year, unless a bit towards the higher side of the band due to the product mix and stable input pricing. As you all know, past few months, prices of steel have been broadly stable, resulting into resurgence of stalled projects, leading to good demand across all segments in the previous year. The expansion across sectors has served mainly in refineries, process industry and core sector, which may harbor well for the infrastructure demand and more traction may be expected in demand of both CS and SS pipes across the globe. However, the order visibility in oil and gas transmission lines looks muted in India due to this quarter, the business traction in the other segments and SS pipes and tubes continues to remain quite encouraging. Now, I would like to straightaway touch upon the quarterly financial numbers and business updates in brief and then we can have questions from your side. Our operating revenue has increased 47% year-on-year and up by 36% on sequential basis, mainly attributable to higher dispatches during the quarter. For the full year, our revenue growth has been 39%, with EBITDA of INR 793 crore and margin expansion of 130 basis points. Profitability has been around INR 300 crore at operating level for the quarter, compared to INR 200 crore during the Q3 of FY 2023. This is mainly because of the product mix, better utilization and operating efficiencies. We are projecting the top line of INR 5,000 crore, ±5% and the margins are expected to remain in line as that of current year, with the variation of 2% here and there. The present macros look conducive for maintaining our long-term growth and margin prospects. A s we begin this financial year, our orders on hand as on April 1 was roughly INR 2,600 crore. Further, I would like to brief on few major developments. We wish to inform that we had successfully commissioned a captive solar project of 15 megawatts in the month of march and we expect the same to result into further reduction of carbon emissions and surely our power costs, showcase, showcasing our orientation towards ESG and sustainability. Our CapEx in CS and SS are progressing well, now with some initial delays that happened due to land acquisition and longer lead time for machineries. During FY 2023, we have continued with our strategy to invest in more specialized products and improving efficiency with focus on technology and infrastructure. Our well-calculated and judicious capital allocation in CapEx and all investment resulting in very sound balance sheet to leap to the next level. Now, regarding our subsidiary, Ravi Technoforge Private Limited, which has clocked a total revenue of INR 245 crore, with EBITDA margins of 10.8% and net profit of INR 4.5 crore for FY 2023. The CapEx has been underway for capacity and process expansion, automation, cost reduction, captive renewable power and same is expected to be completed by the end of September/October 2023. We are projecting the top line growth of 15%-20%, with margin expansion of 200 basis points for FY 2024. That's all from my side at the moment. Now, if there are any questions, I will be happy to answer. Thank you. Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on their touchtone 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. We have our first question from the line of Noel Vaz from Union Mutual Fund. Please go ahead. Hello, G ood afternoon and r egarding the Q4, what exactly were the sales for the quarter? And is this particular run rate can it be sustained or annualized for FY 2024? I could not hear the first part of your question. Can you please repeat? Yes. What are the sales volumes for the Q1 and can the number be annualized for FY 2024? Thank you. T he total revenue for Q1 was approximately INR 1,450 crore and, yes, we have the capacity to do it, but, sustainable over long run, since we are in a project-led business. So we might see INR 1,500 crore in one quarter, another quarter can be INR 1,000 crore. Again, it can go to INR 1,500 crore, but yes, say INR 1,000+ crore is what is our target, with one quarter going to INR 1,500 crore, INR 1,600 crore. I'd like to answer one thing. Total volumes in Q4 were close to 106,000 tons for all our products and, as Manoj has shared, see, in our case, margins are totally dependent on nature of product, product mix, timing. So, so many factors are there. It is very difficult to say if performance in a particular quarter can be extrapolated, because we are in project business, order-driven activity. So, we always say between 16%-18% is the range at EBITDA level, which seems to be sustainable over a longer period. ±1% here and there may happen in a particular reporting period and that should be there going forward also. Yes, thank you. That is all from me. Thank you. We have our next question from the line of Pritesh Chheda from Lucky Investment Managers. Please go ahead. Sir, can you give the volumes for FY 2023 and what would be the capacity utilization on this blended capacity utilization? See total Pritesh, we did close to 304,000 tons for both the products during FY 2023 and on capacity utilization, Manoj will share. Because we see in our case for stainless steel seamless, it would have been optimum. Stainless steel welded would have been close to 60-65%. Newer capacity in stainless steel seamless would be closer to 35% and on carbon steel, ERW has been optimum, ERW has been optimum. LSAW, process wise, older capacity has been optimum and newer capacity will be maybe around 30-35% sort of thing. I will end there, segment to segment, it will vary but most of the segments, other than newly added capacity, utilization was between 60% and 80%. Only stainless steel extrusion and LSAW, both were close to 30% utilization. You said that SS seamless is 35% and SS welded is 100? No. SS seamless is optimum, cold finishing, okay? Optimum means it's close to 80%-90% sort of things. Cold Finishing will be around 8,000-9,000 tonnes sort of thing and welded is maybe around 60-65% sort of thing. Newer capacity has been roughly maybe around 30% only, for hot extrusion. SS hot is 30% only? basically, on that 20,000-ton capacity that you added in FY 2023, the capacity utilization is 30%? Yes. SS seamless, which is your cold, is full capacity? Yes. Basically, in the 48,000 ton, you would have SS seamless of 8, SS welded of 20 and SS hot of 20. See, SS, whatever we produced from our seamless, some part has gone for Cold Finishing also, captive usage. I f you look at the sellable capacity, that will be little lower, because whatever captively we are using, that will, that will become part of the overall capacity only. It will not be available for sale. Is it possible to share in this 34,000 tonnes, how much is extra? Earlier we used to share, but since last few quarters, we have taken a conscious call not to share such info. S eparately we can discuss. No problems. What is the progress on the capacity expansion that you had planned about INR 180 crore in SS and another INR 170 crore in carbon steel? Yes. Stainless Steel expansion of Cold Finishing facility will be over by December of this calendar year or maximum January of next calendar year. For Carbon Steel, land acquisition and development has already started and we expect that to happen in Q1 of next financial year. My last question is, sir, there is this anti-dumping which has come on hollow pipe, SS hollow pipe. So how and also SS pipe, the anti-dumping the duties have been increased. So, how does it benefit us in terms of the capacity utilization? If you could share that and the industry at large. Yes. A nti-dumping on stainless steel seamless pipe had come somewhere in November, December of last year and since then we have, we have seen demand increasing, but lot of it being imported in India was re-exported. T hat demand is for there, the anti-dumping does not play any major role. It is still being imported. yes some demand increase is being seen because of this anti-dumping. Are we 100% backward integrated in hollow pipe? Yes, we are. We have our own Mother Hollows, not from melt to finish at the moment, right from melting, then, casting them So you basically must be buying a bar, right? And you make your own hollow pipe. Yes. A billet and you must be making your own hollow pipe. Yes. Thank you. I'll come back. Thank you. Thank you. We have our next question from the line of Poojan Shah from Congruence Advisors. Please go ahead. Hi, sir. On a previous con call, we have seen hydro demand on that part. Currently wanting to know on that part, what are the situation currently we are facing from the hydro side and how we are looking at the industry trend for that? Hydro, hydrogen? Hydro. I'm talking of Hydrogen. Hydro power, hydro power plants. Hydro power plants, no major demand. For hydrogen, still very nascent to comment what kind of pipe will be used and whether stainless steel, carbon steel. In the process, maybe stainless steel for transmission, maybe carbon steel. That we will come to know once, going forward, because a lot of research for the steel is also going on and in the process, whether it can be welded seamless. So those research are still going on. S ir, our expectation is that we are speaking about INR 5,000 crore top line in next financial year. Currently, we are at around INR 4,500 crore, so and we have grown around 43% for this financial year. W hy we are eyeing like are we being conservative or we are seeing some subdued demand in any sector specific? T wo reasons. See the kind of growth we had for the last financial year, it's like one of a kind, because the projects were there demands were there, capacity came in at the same time, so we could capitalize on that. Yes, in this financial year, we see some drop in carbon steel line pipes demand, which, still because of better utilization of other products, we will be able to maintain 10% growth rate. G ot it. Thank you so much. Thank you. We have our next question from the line of Kunal Shah from Carnelian Capital. Please go ahead. Hi, Sir, This is better now. A few questions from my side. In the first place, congratulations for such fantastic set of numbers! Wanted to get a sense on the volume growth for the next year and also, you know, we get about 106,000 tons the execution in the current quarter in comparison to about 66,000-67,000 in the previous quarter. So wanting to understand what led to this superb execution in the current quarter and also, if you could help understand volume growth guidance for the next year. A s commented previously and in my opening remarks, the volume growth, like we finished this year at INR 4,400 crores and close to INR 4,450 crores. Next year, our expectation is, or what we have budgeted is close to INR 5,000 crores. That can be at ±5% and to answer your second question which is led to such numbers in the quarter? T he utilization for all the segments and all the products, during the last quarter was at its optimum, which led to this number. So if in case there's demand and for all the products, all the segments, then, yes, this number is achievable. I've in my previous call, I've already said that we have capacity today to reach a turnover of INR 6,000 crore. Got it. Also we have this enabling resolution that we have taken for about INR 500 odd crore. So, you would want to like how should one look at that? B asically, it is an enabling resolution. B ecause we are working on our next growth plan also. If required, we may go for tying up the debt and in case of debt, as you know, now regulations require a portion of debt has to be raised through bonds and other instruments. So it is an enabling resolution. Right now, nothing has been planned as far as CapEx is concerned, but team is working on that just it will save time, nothing else.. Got it. Just wanted to understand on these bearings, right. So we have got about INR 104 crore revenues in the current year coming from Ravi, right? So when you say 5,000, how should one look at the bearings business in this 5,000. 5,000 is on standalone basis. So whatever the INR 300 crore we are targeting for Ravi is additional. So on consolidated basis, we can have a number of INR 5,300 crore with ±5%. Got it, Just one last question from my side. You know, on the general demand scenario, you know, if you would share how is the water projects going on, the CGD projects going on and you just mentioned- Mr. Kunal Shah is dropped from the queue, We'll go on to the next question from the line of Radha from B&K Securities. Please go ahead. Hi, sir. Congratulations on good performance. Thank you. My first question was that, so two years back, we had this, seamless stainless steel, capacity of 8,000. So now that is, 28,000. So at that point of time, two years back, via hot extrusion, the capacity was 6,500. So now that the stainless steel seamless capacity at 28,000, so, what is the hot extrusion capacity? 8,000 was cold finishing capacity. Today, the hot extrusion capacity is 20,000 tons for the new press and the old press is 6,000, maybe 6,500 tons. 10,000 total. Ten thousand. Hot Extrusion is 30,000 tons and Cold Finishing is right now close to 10,000 tons. Sir, what will it be in the next one or two years? See, a marginal increase in cold finishing will be there, because we are setting up a facility for the higher value-added products, which will become operational by year-end. But overall capacity in stainless steel seamless will continue to remain at 30,000 tons, combined together with hot finish and cold finish. Because whatever we are going to produce through hot finish, part of it is going to be used captively, which will, which will be cold finish. So, sellable capacity will be 30,000 tons of seamless, 20,000 tons of welded. So total 50,000 tons of capacity. Sir, next question is in stainless steel. So company is planning to do this Coiled Tubing business. So just wanted to understand, for this business, will this be in a separate manufacturing line or in the same line? And, also with regards to this, so wanted to understand, what is the product about? How is the market size and, what is the scope of business and competitors in this business? I don't know where you have this information from of coiled tubing, but that project is still under implementation and that data we would not like to dive at the moment. Sir. Thirdly, this Ravi Technoforge, in FY 2022, we did a revenue of INR 280 crore. Now, in the second half of FY 2023, revenue is INR 104 crore. So if you extrapolate, it comes to around INR 200 crore for full year. So is there a de-growth in this business in FY 2023? Yes, FY 2023, so first seven months, they clocked a revenue of INR 130 crores and last five months after our acquiring the stake, they did a revenue of INR 105 crores. So this year, yes, there has been de-growth. One, during the first seven months, they had some financial stress, so they could not actually utilize the capacity and convert the demand into orders and second, after our—because of slowdown in U.K., this, because of the war in Europe, there is a little slowdown from European manufacturers, which led to this de-growth. But going forward, we see that the demand has started coming back and this year we will be able to clock close to INR 300 crores. Sir, what about the debt in this business? in FY 2023, we have around INR 75 crore of total debt. So how do you see this in the coming years? Every year, there's a repayment of between INR 15 crore-INR 20 crore, which has happened in the last year. Sir, lastly, this in ERW Carbon Steel, mobile manufacturing, mobile plant of 60,000 tons, around 60,000 tons, so that plant, is it fully depreciated? That plant, Kattaji, I don't know the depreciation fully. No, there will be something left. It would not be fully depreciated. Sir, lastly, what is the CapEx guidance for next two years? Next two years, we are working on a lot of things. At the moment, still on the drawing board, so, maybe in another six months we'll be able to throw some light on that. That's it. Thank you so much. Thank you. Thank you. We have our next question from the line of Riya Mehta from Aequitas Capital. Go ahead. Hello. Thank you for giving me an opportunity and congratulations for good set of results. Thank you. My first question would be based on good order book levels of both stainless steel and carbon steel. I would want to know where this is coming from, exactly, almost and which sectors and segments? For the last quarter? Yes, order book for the last quarter, INR 2,400. No. Can you please repeat the question? I'll answer. See, mainly the orders are coming from oil and gas sector and process industry for stainless steel and certain orders from power sector also and plus other miscellaneous are there.? And in case of carbon steel, it is a mix of oil and gas sector and water. My next question is in regards to margins. What worked in favor for us this quarter? See, one thing is we got the benefit of economies of scale, because production mixes both were higher. Second thing, product mix also means higher value-added products, volumes were also higher and in carbon steel also, major orders were related to oil and gas sector, where margins are typically better. So everything worked in favor of better margins. A ctually, could you tell me the capacity utilization again, if you don't mind? 60%-85%. Manu can tell you. Go ahead. No, Manu, repeat please. Y ou see most of the segments, stainless steel welded, stainless steel seamless, carbon steel ERW spiral, also, the induction bends and coatings. It is all the products, the utilization is between 60%-80%, except for two capacity expansion. Like one, hot extrusion for stainless steel seamless what we doing and another capacity expansion in carbon steel LSAW pipes. So these two were on 30% utilization, with utilization being the first year of actual commercial production and rest all were between 60%-80%. All right. In terms of the pipeline of orders, what is the kind of pipeline are we seeing for the next year coming forward? We started this year with INR 2,600 crore. We've been booking orders for stainless steel, seamless, welded, across industries and for carbon steel and LSAW pipes. However, some softness is seen in the CGD segment and the line pipe segment. So, but we are open the line pipes, or spiral line pipes on oil and gas segment. But we are hopeful, we are seeing good demand in water segment, so we are hopeful we'll cover up on the water segment. Thank you, that's it from my side. Thank you so much. Thank you. We have our next question from the line of Dhananjay Bagrodia from ASK. Please go ahead. Hi, sir. Just wanted to understand, our increase in margins, I missed this. Is it increase in margins because we had some contracts earlier and that's how we got the benefit of lower inventory? And B, which end use industry is seeing such strong volume growth and do we see that sustainably grow, let's say, next year and the following year after that? P art of it, yes, may be correct, that you have some orders which are of the start of last financial year when there was when the war had started, commodity prices was skyrocket, then you got some orders. But most of, as, as you know and as we always say, like, most of our orders are on back-to-back basis, so we, we have so, maybe 10% benefit, we would have derived from such total orders are out of total orders, 10%. But not a major part because of the commodity prices. Main commodity. Margin is sustainable because our GM and operating margins are sustainable? Margin is between 16%-18% because, see, last year, if you see, the if I break down the product mix, industry-wise, more we did for oil and gas, right? But it is not going to remain same year on year. Maybe this year, it might change that oil and gas might go down a little and water is added. So if water is added, the margins might, but still, we keep our focus on to maintain, to stay between that 16%-18%, 15%-18%. Sir, just following up with a question. What is the difference in margin between oil and gas and water? It's normally oil and gas is a little more value-added than water, maybe 1% or 2% more, but it totally depends on demand and supply. Sure. Thank you. Thank you. We have our next question from the line of Vikas Singh from Phillip Capital. Please go ahead. Good evening, sir and congratulations on very good set of numbers. Thank you. Sir, I want to understand since we are guiding for almost double of the top line versus our current order book, but we are at the same time telling that the oil and gas segment demand is a bit slow. So are we expecting incremental demand to come from water segment or export segment or because CS's segment is the one which drives our top line. So just wanted a little bit clarity on the same. Yes. So see, if we started the order book at INR 2,600 crore, so we are already having, say, six months backlog, if I consider INR 5,000 crore of revenue. and we are seeing few water projects, specifically, if I talk about carbon steel, we are seeing few water projects which we will book in the first or Q2, which will be dispatched in third and Q4. So, to answer your question, yes, INR 5,000 crore is very much possible, considering you have, you are already having orders of INR 2,600 crore. Let's say water, domestic water segment is what, where we think that the traction would be there going forward. There is demand for domestic water segment, there is demand for international water segment also. Few projects we are under discussion. Understood, sir. Sir, second question pertains to SS segment, the export orders. Basically, after many quarters, I have seen that our export order book in SS has been on higher. So is it a short-term phenomenon you see, or do you see that this kind of the trend would be sustainable and a lot of order can be exported from India in SS segment especially? Going forward in stainless steel, yes, this kind of export is sustainable. More and more end customers are accepting our product and once we've seen repeated orders. So we don't see any until, unless there is anti-dumping or anything, we don't see any reason for this to go down. Because, basically, traditionally also, we have been getting almost 50% of turnover in stainless steel from physical exports direct and around 20% from indirect exports. So that way, stainless steel, in stainless steel products, we are already there in a reasonable way in international market. So, with the increased capacity, our focus is going to be both on import substitution and international market also. Understood, sir. Sir, just one last question on the CapEx. So at least can you tell us the FY 2024 CapEx targets, which you considering current plans? Maybe 100, 150, 200 might be there. But see, we something for the next growth plan will also be happening, by the time we close the year. So, major outflow will not be happening for that. So safely we can say INR 150-INR 200 might be the range.. Sir, we already had INR 350 crore kind of the CapEx plan, which was announced at the start of the year addition, so out of which? For Odisha project, it will take some time.. A s of now, how much we have spent on that INR 180 crore of SS cold rolling facility and this Odisha project, how much we have spent on these individual projects? Odisha project is only very significant. Some amount for lease rent and other things have been paid. The major outflow will be happening for land. Land will be anyway lease rent only will be going. CapEx will take some time. Some civil activities may be starting. Am I right, Manojji? Yes, CapEx will take some time. Maybe we will see something starting from the Q2 of this year. In standard system, so we might have spent 60 maybe around 60-70 crore sort of thing. Major outflow will be happening once these deliveries of critical plant machinery will start. This year, again, we see our cash balance going up, right? Because this money would be getting accumulated or- W e as I have shared now, there are plans to continue this growth beyond FY 25 also. So, something other than whatever we have planned, that may also be planned and we'd like to start working on that opportunity also.. Very well. Sir, what is our net cash balance as of now? See, net cash keeps on fluctuating. So as on 31st March, we on net side, net side, we were close to INR 20 crore+. Today, it might be again 20-30 crore ±.. Because total long-term debt will be maybe around INR 140 crore. That could be our peak net debt level, INR 140. Net, Because there are no short-term borrowing, only long-term borrowings of roughly INR 150 crore are there as on date.. Thank you, sir for answering question and all the best. Thank you. Thank you. We have our next question from the line of Pallav Agarwal from Antique Stock Broking. Please go ahead. Good evening, sir, I have a question on, you know, as a stainless steel manufacturing, you know, the hollow pipe process. So is it, is there some difference between the hot extrusion process, you know and a cold drawing or a pilger process? Is the process that we follow, is it superior to the other, you know, processes? Hot extrusion, pilgering, drawing, those are all different processes. Hot extrusion is the hot extruded material is input for the pilger machine. But yes, there is similar process to hot extrusion, which is piercing and piercing is normally used for carbon steel seamless pipes. Whereas China adopted a technology of using it for stainless steel pipes and then the Indian manufacturers also started. So yes, there is a vast difference, because one is used for carbon steel, another is used for stainless steel. The product which comes out is also different. Sure. So there are certain high-end applications where probably that product is not accepted. Is that the case? If you see, for example, Saudi Aramco specification, they don't accept pierced material. Or if you see for, you know, Reliance's specification, they don't accept the pierced material. So there is a reason a lot of study has gone in, there are various papers available online also, which explains the difference between both. But, there are some industry where criticality is not so much and they are to use pierced material. Sure, sir and also just on the question on exports, what was the proportion of exports in total revenues and in the order book? 20%. Total exports are close to 20%. Order book also, current order book of INR 2,005 crore mostly. Order book, I don't have the breakup of exports on that. I'll just share. Just one minute. Yes, sure, sir. As on first May, we were having close to INR 557 crores of export orders out of INR 2,450 crores of total order books. Sure, thank you, sir. Thank you. Thank you. We have our next question from the line of Aman Thadani from Solidarity Investment Managers. Please go ahead. Thank you, sir, for taking my question. So my first question is, one of our peers has recently entered the ERW space, so I just want to understand that what sort of margin does a new player make in this space and the overall opportunity in this space? What sort of margins? This space is difficult to say at the moment, because see, the last three years, four years, our ERW was running at, say, almost 90% capacity utilization. But this year, that there is, the demand is not as high as it was. so.. and with a new player coming in, of course, he will take some time for approvals and everything. But, margin is again, difficult to say because it varies from 12% to, say, 16%-18%, depending on number of projects available in the market. See, what has happened, CGD demand has also gone down a little. Sir, how much time will it take for a newer guy to ramp up? How many years does it take? For a new company to ramp up, 12-18 months. M y second question is since HF is a key business for Ratnamani, what is it about this product or this segment, that a lot of players have just not got it right? Time. The amount of time what we've done, right from 1983, 1984 and slowly, consistently growing that is the only thing I would say which is different. Sir, time in terms of what? Is it in terms of the complexity that is there in like to understand that complexity or is it in terms of- It is a different, mindset of business, I would say. It is not like a normal tube pipe business. Carbon steel is totally different, if I compare with stainless steel. Sir, even if someone is able to get the product right, even to maybe bid for the projects, what are the criteria there that one player would need? It's more about the competition rather than Ratnamani, I don't know what you want to hear, want to understand from me answering this J ust one general question, sir. In the past, we have guided for 15%-17% long-term margin band, but this quarter we are seeing that, going ahead, it would be more of 16%-18% range. So, sir, what has changed? The product mix, because as, I have told you, the carbon steel demand in oil and gas is subdued, so likely from that INR 5,000 crore, more will be stainless steel, more, more will be value-added products in carbon steel. So that's why it is 16%-18%. But at the start of the year, this is our guidance. It can be between 15%-18% also going forward. If, if few water projects are booked at a little low margin, it can be 15%-18% also. Sir. That is it from my side, sir. Thank you so much. Thank you. Thank you. Ladies and gentlemen, to ask a question, please press star and one on your phone now. We have our next question from the line of Ashutosh Tiwari from Equirus Securities. Please go ahead. H i, sir, congratulations on good numbers. Firstly, this cold finishing capacity will go to what level after this expansion is completed? This new capacity expansion is of 1,200 metric tons to start with and it will go up to 1,500 metric tons. 1,500 tons, your capacity go to only 11,500? Yes. The capacity expansion is small in terms of tonnage, but this is for small diameter tubes. I n terms of meters, then it will be quite substantial. S econdly, we had also talked about development of multiple grades of product with this new seamless, hot extrusion capacity. So where are we in that process? In last one year, have you developed major products and that is going to drive the growth in export market going ahead? Some color on that, how should we look at export as a business over next two, three years? Yes. So the exclusion, what we had expected, to do in the first year, we could achieve better than that. 30% utilization with development of grades, which we did not expect in the first year itself. G oing forward, yes, the utilization will be better and this year we are targeting between 50%-60% utilization. 50%-60% utilization? A s such even the all this will be high margin business, like 20%+? Some grades, yes, some grades lower. So a blended, if I put together, it will be same, close to 15%-18%. T he access also will be the same, or this year? B ecause you see, lower end grades, where it is more like commodity, there, there the margins are also, not, not so great. But, for high-end grades or difficult products, the margins are good. So blended, we always because we cannot only do high-end grades and or we cannot do only the, the below end of, of, the product. So both blended, we see the capacity utilization also and margins also. Like we used to highlight earlier in the concall, can you highlight, like, what kind of bidding that we done to the tonnage and all in oil and gas, water and all as of now? D etails I haven't prepared this time. Maybe in the next call, which we plan after six months for the semi-annual results, we'll have more detailed details on what we are bidding. C an you highlight some projects which are like say the activity is going on right now? Oil and gas, if we see right now for bidding, what we have is one project of Gas Authority of India Limited which is KK BNPL Phase 2, which is Kochi, Kuttanad, Bangalore, Bangalore pipeline project, phase two. So that is under bidding. Then a few projects of IOCL are under bidding. Few in the east for IGGL, which is Indradhanush Gas Grid Limited, is under bidding. One project for Vedanta is under bidding and one or two projects for GIGL. GIGL is a subsidiary of GSPL. There are a few projects in oil and gas which are under bidding. For water, we have few projects in Gujarat for Surat Municipal Corporation, for Ahmedabad Urban Development Authority, then Awani Yojana. I n Gujarat, we have some water projects and we have some water projects in Africa, which we are bidding. You said Africa? Yes, 2018-19, we done some in Tanzania, right? Is it similar kind of project? We have now this is for Mozambique or Kenya. I'm exactly not sure what place, but it is for Africa. L ast year also we had exported some quantities to Africa. The carbon steel is purely opportunity driven. It is nothing in case of export. So whenever we get the opportunity, our team puts the orders also and that acquisition has happened. O n access side, how are, let's say, how are the orders or maybe inquiries from chemical, pharma and all? Is it also strong or it is softer in the business earlier? I f you see the growth, the driving things in this year is stainless steel and some products in carbon steel, which will have help us actually, because the line pipes will remain flattish, kind of growth. Y es, stainless steel will grow some products in carbon steel will grow, which will help us reach that volume. Is it coming from this chemicals and pharma and all, fertilizer? It is coming from various industries: pharma, chemicals, fertilizers, food and dairy, sugar, automobile, of course, oil and gas still remains the highest. Thank you. That's all from my side. Thank you. We have our next question from the line of Hiren Kumar Thakurlal Desai, an individual investor. Please go ahead. S ure. I have two questions. One is on the export side. As you mentioned, this year, the visibility seems to be a little bit muted. Do we have a medium-term thinking in terms of increasing the export share so that this little bit of cyclicality can be sort of mitigated? Yes, we have our focus on exports. Our LSAW plant has just started, so, it is slowly getting approved in various countries, various geographies. So our focus is there on exports, but this is a project-based business. So if there is a project, yes and, definitely then, if it is within our reach, reach meaning if there's no anti-dumping in that country or in-country value to be provided for most of the projects we are there. Do we target some percentage medium term or we can't really say something like that? Very difficult. One project can change the total dynamics, like 30% export and then if you don't get that product, project, it is maybe 10%. Carbon steel, it is difficult to say. Because it's not, it's not like many projects, you are supplying to and small quantum. It is one project which is, INR 500 crore, INR 600 crore or INR 700 crore. So the whole dynamics, on the export percentage changes. No, my second question has been answered, that's all from me. Thank you. T hank you. Thank you. We have our next question from the line of Riya Mehta from Aequitas Capital. Please go ahead. Hello. Thank you for giving me the opportunity for a follow-up question. My question was in regards to, since we are seeing that, water segment is seeing some good traction. Apart from water, where do we see the demand coming in from, if we are seeing lower, demand for oil and gas and considering that the realizations will also drop for the next year, given the lower commodity prices? Where do we see the growth and, confidence for the revenue visibility? A s I answered, the previous question, see, oil and gas line pipes is low, but oil and gas process pipes is still on the higher side, both for stainless steel and carbon steel. So that is one sector where we see the growth. Then, stainless steel utilization of capacities in extrusion and some better utilization in LSAW we will get there. T hank you so much. Thank you. Thank you. We have our next question from the line of Pritesh Chheda from Lucky Investment Managers. Please go ahead. J ust two follow-ups. One, what is the utilization that you would expect in the expanded, hot finish SS, which was at 30%, you mentioned in FY 2023. This, how much will you scale up to? 50%-60%. 50%-60%. My second question is on this expansion of SS, which you mentioned will add 1,500 tons via that INR 170-180 crore of capex and it's a low diameter but substantial length. Is it the auto tubes, basically? No. No, these are not auto tubes. No. Any reason why for INR 180 crore is just 1,500 tons? Or if you could tell us, what will be the per ton on this INR 180 crore? 1 is to 1 or maybe a little less. What is this product, actually? This is very high limited product. Stainless Steel Cold Finished Tube. What is the dia size? Is it less than half an inch or one inch? Less than 3 mm, beginning from 3 mm. Yes. Three mm and used where? It's not auto tube, right? No. These are used in nuclear power plants also, Number of applications are there. Done, sir. Thank you very much. Thank you. We have our next question from the line of Aman Thadani from Solidarity Investment Managers. Please go ahead. Sir, I have just one follow-up question. S ince you said that the CGD sector is seeing some pressure, I just wanted, can you throw some more color on it? Why is it under pressure since the entire sector is at such a nascent stage? W hat happened, because of the war in Europe, the gas prices escalated quite a bit. and, the government, where CGD was a priority sector for gas, in between changed that sector and they were not given APM. APM is a subsidized gas, gas which, the government would allocate to the CGD companies also. T hen they had to buy in the spot market, the risk associated was quite high. They are going slow at the moment with the capital investment. I t's just a temporary issue, not the long-term story, still intact, right? Yes. It seems to be a temporary issue. Thank you, sir. Thank you. Ladies and gentlemen, that was the last question for today. I would now like to hand the conference over to Mr. Sahil Sanghvi for closing comments. Over to you. I just want to thank the management for patiently answering on the questions and on behalf of Monarch Networth, I would also like to thank all the participants. Manoj sir, would you like to give any closing comments? Thank you, Sahil. Thank you, Monarch. Thank you all the participants and, sorry to be not answering some questions. We want to answer, but then, the situation demands that whatever delay, whatever, we as a group have decided not to divulge a few information, but it is not that we want to hide something. It is for the better for the competition to catch up. With this, thank you everyone and sorry once again. Thank you. On behalf of Monarch Networth Capital, that concludes this conference. Thank you for joining us and you may now disconnect your lines.