Ladies and gentlemen, good day and welcome to the Q3 FY2025 Earnings Conference Call of APL Apollo Tubes Limited, hosted by Batlivala & Karani Securities India Private Limited. 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 call, please signal an operator by pressing star, then zero on your touch-tone phone. Please note that this conference is being recorded, and I hand the conference over to Mr. Shailesh Raja from Batlivala & Karani Securities India Private Limited. Thank you, and over to you, sir. Thanks, Shailesh. Good evening, and thanks to everyone who has logged into APL Apollo Tubes Limited. Thank you for taking the earnings conference call. Now, let me introduce you to the management participating with us in today's earnings call. We have with us Mr. Sanjay Gupta, Chairman and Managing Director, Mr. Deepak Goyal, Director of Operations, Mr. Anubhav Gupta, Chief Strategy Officer, and Mr. Chetan, CFO. I would now like to turn the call to Mr. Anubhav Gupta for the opening remarks, followed by Q&A. Yeah, maybe we can go. Thanks, Shailesh, and thanks to Batlivala & Karani Securities for hosting APL Apollo for its Q3 FY2025 earnings call. I welcome all the participants who have joined this call. I welcome everyone with a lot of enthusiasm and excitement because it was a very critical quarter for us because of the very weak earnings in the previous quarter, wherein our profitability had declined quite significantly. But we are glad to share that quarter three has been our best quarter ever with all-time high sales volume, EBITDA, and net profit. During our Q2 earnings call, we had promised to deliver 10% sales volume growth on a quarter-on-quarter basis and report EBITDA range between INR 4,000 to INR 4,500 per ton. And we have achieved the same, but just like to highlight here that this has been only possible because of the resilient business model of APL Apollo Steel Tubes. The macro environment has been very difficult since the beginning of this year due to multiple factors such as weak retail demand and slowdown in the government spending. Despite this, we have been able to achieve 20% sales volume growth for the first nine months. Well, we were well aware of this situation, and our focus was to increase sales volume and kill the competition. As you can see, that nine months' FY2025 sales volume growth of 20%, which we reported, and we can bet that this is higher than any other competitor or player who has been producing and selling steel pipes. This implies that APL Apollo Tubes has gained significant market share in the overall steel pipe market, which also includes low-grade sponge iron pipes. Because of the transition from sponge iron pipes to HR coil steel pipes, as the prices for primary raw material have fallen over the last three to four quarters. Now, going forward, we expect sales volume to increase quarter on quarter, which is backed by, number one, market share shift from sponge iron pipes to HR coil steel pipes, where APL Apollo has a clear dominance and line market share. Our international sales volume is also going strong with the commitment of the Dubai plant. Now, that plant is operating at 58% utilization if we look at the Q3 volume. This was very much there on the cards because we knew that we must have access to cheaper steel outside India, and Dubai was the perfect destination where we have access to cheap steel from Asian countries. The third factor is our focus on adjacent round pipes, which is part of the building material portfolio where we have the capacity. We have the same distribution network, and these pipes go into buildings for HVAC and water piping and is part of the overall construction material portfolio which contractors use while construction. The fourth factor is the ramp-up of our innovative products from Raipur. If we look at the expanded capacity in Raipur, which is 1.2 million tons, the utilization rate is 55%. It could have been higher in Q3, but because of raw material situation, like lack of raw material availability in Raipur from one of our steel suppliers, there was loss of volume. Otherwise, this utilization rate of 55% would have been definitely better. And lastly, our penetration into Eastern markets with the commencement of two plants, one in Gorakhpur and Siliguri. Gorakhpur will take care of Eastern UP and Bihar-Orissa belt, and Siliguri plant will take care of Northeast markets where a lot of construction activity is taking place, and it has been the focus area for Indian government. Now, talking about the margins, what levers we see are, number one, operating leverage benefits as we ramp up our capacity, which today stands at around 4.3-4.5 million tons and ready to reach 5 million tons over the next one year. Right now, we are producing and selling around 3.3 million tons run rate. So there is INR 400-INR 500 per ton operating leverage benefit what we see over the next one to two years as we utilize near 100% levels. Then value-added product mix improvement coming from our Raipur and Dubai plants. Again, it gives us visibility for INR 400-INR 500 per ton expansion in our EBITDA spreads. Thirdly, the ongoing discounting, which we shall pull off once we see strong demand pull in the end market, which right now is missing. We expect that Indian macro situation should improve in the coming quarters as we start spending, and as the monetary situation eases out, the retail demand should also recover in the second half of the ongoing calendar year. Based on these factors, we are confident that we shall achieve 3.1-3.2 million tons of sales volume for full year, and absolute EBITDA slightly better than last year because there was a lot of miss on the earnings front in the Q2. We are trying to make that up in Q3 and Q4. We believe that our full year EBITDA should be better than last year EBITDA. Now that we are ready with 4.5 million ton capacity going to 5 million ton over the next 12 months, so we do maintain our sales volume target of 4 million ton by FY2026 and 5 million ton by FY2027. The residual CapEx for these new plants and to reach 5 million ton is around INR 6 billion, which will be funded from internal cash flows over the next three to four quarters. If you look at our balance sheet, it remains near debt zero, which is obviously backed by efficient working capital management now that has been proven over many quarters. The nine-month ROE/ROC look slightly depressed because of, again, poor profitability in Q2, but same shall improve over the coming quarters as our earnings expand to normalize levels and we ramp up our capacities. That's all from our side. We are ready to take questions. Thank you so much. We will now begin the question and answer session. Anyone who wishes to ask questions may press star and one. Participants are requested to use handsets while asking questions. Ladies and gentlemen, we will wait for a moment while the question queue assembles. First question is from Amit Dixit. Yeah, hi. Good evening, everyone, and congratulations for a good set of numbers and strong rebound after Q2. I have a couple of questions. The first one is essentially, if I still look at your other expenses per ton, they are practically very static if I compare it with last quarter. So last quarter, you highlighted that there was an element of around INR 493 in terms of per ton, in terms of the discounting. What kind of discounting did we see this quarter and where it is likely to settle at the same as FY2026? So Amit, there are two things. The other expenses don't account the discounting. Okay? That gets net off in our selling price. Okay, so what prompted the, yeah. Okay, go ahead. Yeah. No, no. So I'm asking what prompted the other expenses to remain at a pretty high level of INR 4,045 per ton? Right. So if you look at the other expenses, they are around INR 3.35 billion in Q3 versus INR 3.1 billion in Q2. Okay? This is an increase of around INR 25 crores on quarter-on-quarter basis. Right? In this, the main element if we see, one is the freight outward, which has increased by INR 15 crores. Right? And then power and fuel, which has gone up by INR 5 crores. Then, of course, some miscellaneous expenses which are pertaining to the plant because plant utilization levels were going up. So some INR 10-INR 15 crore increase in the miscellaneous expenses which pertain to the plant. Okay, so going ahead, will it remain at the similar level, or we can expect some kind of drop here? So of course, see, I mean, the major expenses here are freight outward and power and fuel. So they are variable, right? They would go up as the volume expands. Right? But rest of the expenses like consumption of stores and spares, branding expenses, legal professional expenses, and miscellaneous expenses, they shall remain stagnant. And on per ton basis, they will come down. Okay. Understood. The second question is on EBITDA per ton for general structures. Now, compared to the loss that we made last quarter, I mean, this quarter, you have shown a very smart recovery. Of course, it might be due to the declining spread between HRC and patra. So can we, I mean, it's near INR 2,000. So can we see it further expanding as we go ahead, or you think, I mean, most of it is done? Right. So see, I mean, between Q2 and Q3, the difference is the inventory loss, which we booked of around INR 2,000 per ton. Right? That got negated, and that's why the margins are up. So going forward, we are very aggressive in taking market share from the sponge iron steel pipes. Right? And we are being very aggressive in the sales push. So yes, as we ramp up the volumes, the margin in general segment should recover. But it will take a few quarters, right, where you see margins going up to INR 2,500 or INR 2,800 per ton in this specific segment. Great. Thank you so much. Yeah, because this is a segment which directly competes with the sponge iron pipes. Got it. Thank you so much and all the best. Thank you. Before we take the next question, a request to participants to please limit your questions to three per participant. The next question is from Akshay from Canara Robeco Mutual Fund. Please go ahead. Yeah. Thank you for the opportunity. Just two questions. So Anubhav, first question is on the rust-proof products. So there, at least I see that the margins are still lower. I mean, usually we used to do at least INR 6,500, but still we are INR 1,500 off in rust-proof. So any specific reason? Is it higher competitive intensity, or what is it? If you can talk about that, that is first. And secondly, Anubhav, as you said that we are trying to grab market share from the sponge iron side. So practically, it competes with our commodity-side products. So then in this backdrop, does it mean that the VAP improvement which we were earlier in the surging, will it happen at a slower pace versus earlier in the past? Of course, your value-added products are also improving, but then if we see the overall mix, it doesn't reflect that much. So then how should we understand this VAP improvement? So Akshay, I'll address the second question first. Right? See, I mean, if you look at APL Apollo, right, we have clear two business segments. One is general, second is value-added. Now, APL Apollo is a company which doesn't have scarcity of resources, right, whether to produce general segment products or value-added products. Right? We have enough capacity for both segments. We have enough manpower to run both capacities. We have enough distribution network to sell both products, and we don't have any limitation of working capital. Right? Anyways, we are working on two days' working capital. So how we see is that both of the two segments are operating separately. Then there is good demand for general product because the natural transition is happening from sponge iron pipes to HR coil pipes. So we are being aggressive. Right? I'm not growing my value - I'm not growing my general product sales at the cost of value-added products. Please understand that. Right? I have enough capacity, enough resources to run value-added product portfolio. It is just that the demand at the macro side is not favoring the overall growth, right, for the value-added products. And general segment is growing despite weak macro because of this transition which is taking place. Right? So this is industry phenomena, and we are taking advantage of it. But we are not growing at a cost of value-added products. Whenever there is macro support coming, right, and demand for our - whether it is coated products, whether it is Apollo Z, whether it is heavy structural pipes, whether it is light structural pipes, right, whenever the demand comes, you will see similar growth, right, to match general segment growth. As far as the mix is concerned, at 5 million ton capacity, the general segment is around 1.5 million ton, and 3.5 million ton is the value-added product. Right? Okay? And as you know, that we do not give nameplate capacities. Right? We give scalable capacities. So if the demand is more for general segment, we can produce and sell 1.6 million ton also from the same machinery, which today we say that the capacity is 1.5 million ton. Right? So as far as the capacity is concerned, out of 5 million ton, 1.5 million ton will be general, and 3.5 million will be value-added. But yes, if demand for general is more, we can produce and sell more from the same capacity. I hope this is clear. Coming on question number one on rust-proof, see, I mean, right now what we do is we have clubbed two segments under rust-proof category. One is pipes, and second is sheets. So in pipes, we are still making INR 6,000 per ton spread. In sheet, we are making lower margin. That's why on standard basis, it looks at INR 5,000 a ton because we don't want to give too much of sensitive data which can be seen by our competitors. So I mean, we are trying to club the segment. Like this quarter, we also club big and super big into heavy structural. Right? But it's not that my margins in galvanized pipes has come off. It's not the case. Okay. Thank you. Thank you. The next question is from Shaleen Kumar from UBS Securities. Please go ahead. Yeah. Thank you. Hi, Anubhav. Congrats on the good set of numbers. Anubhav, did I hear correctly? You said that we will try to improve on the EBITDA of last year for the full this year? Hi, Shaleen. Good evening, Sanjay here. Haan ji, Sanjay ji, namaste. Sir, yah saal ka EBITDA, full year EBITDA, can it be better than last year ka EBITDA? Yes. Shalin, I'm talking the straightforward line. मेरे को तो इतना नहीं आता भाग-दौड़ के बात करना. Last year bhi promise ki, this year bhi do the volume of around 3.2 million ton. So I very confirm ki we can do between 3.15 to 3.2. Hamara volume ratio to ye pakka jayega. Number two, last year hamara EBITDA tha 1,192 crores. हां जी. Are you hearing, Shaleen? Yes. हां जी, बिल्कुल. Yeah. तो हम किसी भी कीमत पर उस फिगर को क्रॉस करना चाहते हैं. At any cost, we want to cross this figure. EBITDA, हम सब नंबर लास्ट ईयर से अच्छा करना चाहते हैं. Unfortunately, we can't do the EBITDA per ton. हम लास्ट ईयर को नहीं बीट कर पाएंगे. But बाकी और all the firms, we want to beat the number. On the absolute amount of EBITDA, on the volume basis, we want to take a growth of at least minimum 20%. Maybe 26.5 into 50,000,000,000, 50,000,000,000 divided by 26.5. Yeah, more than 20% we want to take a growth. And if there is in the absolute amount of EBITDA, we want a growth. Number two, जो margins पर हमारा pressure है, हमारा pressure अभी किसी जगह पे है. एक अगर Shalin, आप देखोगे, light structure में हमारा margin जो 1900 से 2000 है, और rust-proof में हमारा margin 5100 के आसपास है. So in this quarter, we are trying to improve this both of the margins. ये 1900 को हम 2500 के आसपास ले जाने की कोशिश कर रहे हैं, और 5100 को हम 6000 के आसपास ले जाने की कोशिश कर रहे हैं. तो आप अगर इन दोनों का impact देखोगे, तो पूरे पे आपको INR 400, INR 500 का impact आ जाएगा. So it means we are targeting this quarter more than INR 4,500 per ton EBITDA. Okay. Okay. तो Sanjay जी, INR 400 crore का plus की बात कर रहे हैं आप, है ना, एक quarter के अंदर? Ekdam kar raha hoon, Shalin ji. और 4500 के ऊपर EBITDA per ton की बात कर रहे हो. एकदम कर रहा हूं. एकदम कर रहा हूं. अब बहुत conservative होके बोल रहा हूं. Okay. Sir, ek baat bataiye. Dekhiye, pichhle kuch-kuch quarter se apna growth nahi aa raha tha. Theek hai. Ek cheez to ho gayi hamari HRC aur patra ke beech mein. Theek hai. That is in favor of us. But large diameter HRC nahi hai. Right? Heavy structure mein HRC nahi hai value-added mein. To vahaan pe kya ho raha hai? Vahaan pe aapko itna confidence kaise aa raha hai? No, Shalin, aisa hai ki jiska projects se hum dekh rahe hain ki kaafi amount of inquiries aa rahi hain aur orders jo pichhle do-teen quarters se ekdum band ho gaye the, Q2 to ekdum hi saaf ho gaya tha hamara. Q3 mein thoda sa revive hua hai. Q4 mein main dekh raha hoon ki udhar se kaafi mere ko revive aa raha hai ye larger diameter. Plus hamara abhi kuch jagah outside India bhi approved hua hai. Abhi humko ek Saudi se bahut accha order mila hai. Wahan par Saudi mein hamara bahut accha starting hua hai new project mein. To we are very matlab baaki to God knows, but hum bahut confident hain ki har front par better karenge. Okay. और सर, जैसे आपने जो बोला Saudi से order मिला, तो उसका supply दुबई से ही होगा? Kuch part Dubai se bhi hai, kuch part India se bhi. Jo 300 se above ka sizes hai, 300 to 500, wo India se hai, 300 tak ka Dubai se hai. Plus ek thoda sa plus point hamara ab wo 1000 square ki February mein kisi time chalu ho jayegi. To uska impact hamara March mein bhi uska hamare pas achha order book hai. To jo hum innovation par, mera team hamesha Shaleen teen cheez par aaya hai. I want to work on innovation, branding and cost controlling. To in teeno par mera kaam achha chal raha hai. Unfortunately, pichhle ek-do quarter se hum yeh innovation aur branding par thoda sa kharcha humne apna rok liya tha due to the margins. Ab hum Q4 se wapas aggressive ho gaye hain. To I don't think ki humko jyada issue aana chahiye. Mera ekdum mera roadmap plan jitni marzi baar kahalwa lo, mere se mera bahut clear hai ki is saal unfortunately due to heavy inventory loss hum number poora nahi de paaye. But mera agle saal ka bhi 4 million ton ka vision hai, intact hai. Uske agle saal ka mera 5 million ton ka vision hai, intact hai. Aur jo Anubhav keh raha tha ki 8 million, matlab lagbhag INR 500 crore ka Capex baaki hai, wo not for 5 million ton. Usmein hamara hamari capacity badh ke us INR 500 crore se 5.5 million ton ke aaspaas aa jayegi. Plus hamara jiska South mein humko ye light structural ka capacity kam pad rahi hai cold rolling ki, to wahan par ek Malur mein humne naya plant add on kiya hai. Ek Ahmedabad mein humne naya plant add on kiya hai. ये हमारे पास उस मशीन खाली पड़ी थी, तो हमने कहा उसको market के नजदीक जाके अहमदाबाद में लगा दो. तो ये सब कुछ CapEx उसमें add हो गए. इसलिए ये 200-250 crore से CapEx का नंबर बढ़ रहा है. अगर हमारा CapEx भी intact था, this 500 crore से हमारी जो capacity है, 5.5 मिलियन टन के आसपास पहुंच जाएगी. Got it, sir. All right. सर, कोई नया product जैसे अभी हमारा 1000 का product launch होगा. Hamara 1000 ke square wale ka naya product aa raha hai is quarter mein. Okay. Next quarter में हमारा Galvalume का नया product आ जाएगा. Okay. Okay. Q1 में हमारा Galvalume नया quarter on quarter कोई ना कोई एक product नया लाते रहेंगे innovation के लिए. All right, sir. Sir, ek challenge, ek jab hum distributors level pe baat karte hain, and this is ye South mein jyada hai, wo bol rahe hain ki state government ka thoda capex kam ho gaya hai because unki. Shalin, Shalin, अगर वो सब मेरे को payment मिला हुआ होता, mileage मिला हुआ होता, तो मेरा इसी साल मैं 4 मिलियन टन cross मारता. अब देखो, मैंने October में 3 लाख टन किया है, December में मैंने 3 लाख टन cross किया है. Unfortunately, November हमारा slow रहा था, 238 हुआ था. अब जनवरी भी हम 280-285 के mileage से जा रहे हैं. Okay. मार्च में हमारा किस्सा है. मार्च. December, हमने 3-3 लाख टन को hit मारा है. तो next year के लिए कोई ऐसा ज्यादा नंबर नहीं बोल रहा हूं मैं 4 मिलियन टन. ठीक है, मैं target बहुत tough कहता हूं. भाई, मैं तो अपना target में fail होने में believe करता हूं. अगर मैं पास हो गया अपना target में, तो फिर तो मैंने target क्या लिया? नहीं, नहीं, नहीं, सर. ठीक है, सर. बहुत अच्छा, सर. Thank you so much and congratulations. आप मेरे target को 10% से discount कर सकते हो. नहीं, I hope, सर, कि आप अपना target achieve करें. बिल्कुल achieve करें, सर. Nahin, main to dekho, Shalin. Agar main upar se hi target kam leke conservative baat karunga, to meri team aur conservative ho jayegi. So I don't want. I am bullish, main to usi hisab se chalunga. नहीं, सर, हम भी उसी हिसाब से चलेंगे. आप तो आपके जो आपने target दिया, हम वो मान के चलते हैं. आप ही achieve करोगे. है ना, सर? Thank you very much, Shaleen. Congratulations, sir, once again, and thank you so much, sir. Thank you. Thank you. Thank you. Before we take the next question, a reminder to participants, to please limit your questions to two per participant. The next question is from Rohit Singh from Nvest Analytics. Please go ahead. Hi, am I audible? Yeah, go ahead, please. Good evening, sir. Congrats for a good set of numbers. Sir, can you please comment on why this slowdown in government spending? Like, do you see any structural risk here? Like, we were talking about growth. Last two quarters were also tough, but everyone was saying like economy will start recovering Q3 onwards. But now suddenly macro tailwinds are getting converted into headwinds. So what's wrong happening in this space? Can you comment on it? It's very tough for us to, I mean, tell you the exact answer, but we also read in newspaper, etc., what everyone is or everyone must be reading, that the government spending on infrastructure for the first nine months has been below budget, right? That is one, and second, of course, because of new government formation and the delayed budgets and delay in release of funds, that is impacting some overall demand for the construction sector, but that being said, some of the segments continue to do well. For example, railways, aviation, which have been the core focus areas for the government. There is some slowdown towards the water transportation infrastructure or other segments. But yes, I mean, everyone is hoping that with this budget, which is due over the next few days, the release of funds will start and that will give a push to the overall spending from the government side. Got it, sir. That's it from my side. All the best for the day. Thank you. The next question is from Gargi from Value Quest. Please go ahead. Hi, sir. Thank you for the opportunity. So my first question was that we buy HRC from steel companies and it is usually supplied at a standard size, which is then later reduced to a requirement via this cold mill that we have. So with respect to that, what is the standard thickness size that we buy? And in cold mill, how much do we reduce the thickness? Sanjay Gupta is asking like what is the standard size of coil thickness, which we get, right? And we have to cold roll to reduce the thickness. We have to take a different type of thickness for different type of material. Like हमको 0.8 बनाना है तो उसके लिए क्या raw material लगेगा? 1 बनाना है तो उसके लिए क्या लगेगा? 1.2 बनाना है तो उसके लिए क्या है? हमारी USP है 1.6 बनाना है, 1.4 बनाना है. So we are taking all the different type of thickness with the different type of finished product we required. There is no standard method. Sir, I actually wanted to ask it because in the previous calls I've heard that the cold mill too because of this cold mill, the cost of production reduces in terms of the products wherein the low thickness HRC is required. So what percentage of total APL product portfolio requires low thickness coils? And are these the products of light structures and Apollo Z? Almost 30% we require for the thinner gauges. Sir, entirely we are doing in-house? 30% material we are doing with the cold rolling. Okay, sir, and as per the requirement, entirely we are doing in-house or cold rolls, are you also outsourcing? No, no. Slightly we are taking the South. We are not short of supply. So our capacity is full. So we are taking some in the South, 5 to 10 thousand tons per month. Otherwise, we have to be equipped with our finished product. So we are putting a plant in South also for this product. Okay, sir. So this five million ton capacity जब हो जाएगा, तो इसमें what percentage of the product portfolio will require the cold roll mill? And इसमें से in-house हम लोग कितना करेंगे? Madam, this depends on the market. But हमारा जो इसका capacity almost cold rolling का capacity हमारा 2 million tons के आसपास का हो जाएगा. Okay, sir. So second. 30% के आसपास. अगर 5.5 पकड़ते हैं तो 30% के आसपास हमारा समझिए utilization 16.5, 1.65 million, 1.7 million ton के आसपास utilize होना चाहिए. इसके लिए हम लोग cold roll capacity set up भी कर रहे हैं south in the latest? Hai hamare paas. Tab tak hai bas ek South mein hum short pad gaye. To South mein hum ek Malur hai ek naya plant laga rahe hain. Okay, sir. And those 500-600 crore का आपने जो Capex बोला, it is covered in that only? Everything is Siliguri, Gorakhpur, Ahmedabad, Malur, four new plants and some Dubai mein hum capacity build up aur badha rahe hain thoda sa. So wahan ka sab mila ke hai ye. Okay, sir. Okay, sir. So second question is with respect to Shankara and Apollo Mart. So ये current sales volume, Shankara and Apollo Mart का कितना हम लोग sell कर रहे थे Shankara and Apollo Mart? And when we do the side. Shankara ko, Shankara ko Apollo not being any business. Door padne par koi Shankara ke yaad se koi coil wise shortage hoti to hum thoda bahut coil thousand, two thousand ton maan lete honge. So I don't think some perfect data nahi hai. Shankara is doing our almost 35,000 ton per month. Sir, 5 million tons में कितना हम लोग का target है to sell to Shankara? Is type ka koi target nahi, madam, banate hain. Aur itna detail customer by customer knowledge aajkal hamare competitors bhi humko bahut sunte hain par hum itna bhej nahi payenge open call pe. This you can talk personally from Anubhav. Okay, sir. Okay, understood. So last question is with respect to, in previous call, हमने बात किया था कि our intention to expand distribution in U.S., Europe and Middle East. तो sir, अगर आप थोड़ा उनके उसके बारे में बात कर सके कि export opportunity क्या है in these regions and what is our competitive strength? Yeah, Middle East में अभी हम already we are doing 60,000-70,000 tons per month. तो वहां पर हमारा customer base काफी बढ़ रहा है. और वहां पर जिसका जैसे हमारे onwards वहां पर हमारी delivery और supply system हमारा काफी सुधरा है. तो वहां पर imports pipe का होना, square pipe का, structural pipe का import होना बंद हो गया है. तो थोड़ा सा वहां पर भी old stock लोगों के पास पड़ा वो restocking हो रहा है. I think February और March onwards we have a good response from the Middle East market. And South East also we are now doing four to five thousand tons per month volume वहां से और India से मिला के करने लग गए हैं. वहां भी हमारा volume बढ़ना चाहिए. और तभी हम Dubai में भी अब के second round of phase capex पर भी जा रहे हैं. जो हमारा capacity वहां पर 3 लाख टन का था, we are extending to from 3 लाख to 5 लाख टन. Dubai we can talk freely. देखो, Dubai से कोई चिंता नहीं है. Dubai से हम freely call पर talk कर सकते हैं. Okay, Sir, regarding, इस बारे में if you can expand, आपने बोला कि restocking is happening and imports have reduced in those regions, Middle East region. So what is our USP? Is our cost of production lower? और because it's a relatively नया market है हम लोग के लिए. तो what is our chance? No, no. वहां पर सबसे बड़ा game है. वहां पर जब हमने अपनी service taken थी, वहां पर almost एक dealer four month का inventory cycle पर चलता था. Like in India, हमने वहां पर उसको reduce कराना शुरू कर दिया. Like अगर मैं आपको example बोलूं, तो October-November तक हमको single order, हमारे जो बड़े customer थे, 3,000-2,000 ton का order भेजते थे कि हम माल भेजते रहे. तो हमारी भी service उतनी अच्छी नहीं थी, हम भी supply करते रहते थे. From the last one and a half months, हमको कोई भी order 100 ton से ऊपर का order नहीं आ रहा है. They are confident कि वो order हमको लिखाएंगे, within 48 hours उनके पास माल पहुंच जाएगा. तो ये change मेरे को वहां की market में नजर आ रहा है. The same change what we brought to Indian markets in 2017 with introduction of DFT. Thank you. Before we take the next question, a request to participants. So please limit your questions to two per participant. The next question is from Devvrat Mohta from Capital Group. Please go ahead. Thank you so much. Sanjay Gupta, congratulations on a good quarter. I had two questions. मेरा पहला question था कि general commentary is still कि macro is very weak. उसमें what gives you confidence that you go from the INR 350 crore EBITDA to INR 400 crore EBITDA in Q4? That's my first question. Most confidence तो देखो, अपने काम के ऊपर होता है. ऐसे तो क्या database को क्या बोल सकता हूं? और जो कर रहा हूं, उसके base पर नजर आ रहा है कि मेरे को उसको achieve करने में कोई दिक्कत नहीं आनी चाहिए. और थोड़ा की जनवरी onwards मैंने देखा है कि जो एक अभी दिसंबर तक लोगों का प्राइस टूट जाएगा और टूटेगा, तो माल हमको पुश करके बेचना पड़ रहा था. वो पुश सेल भी थोड़ी-थोड़ी धीरे-धीरे खत्म हो रही है. Demand slowly and slowly create भी हो रही है. एक लोगों के दिमाग में जो डर बैठा हुआ था कि प्राइस और जाएगा, नीचे जाएगा, वो एक confidence आ गया कि now steel price is on the bottom. तो पुश सेल भी थोड़ी खत्म होती जा रही है. एक उसका भी फर्क है, कुछ हमको झटका लगा हुआ है, तो हम भी बहुत सुधर के काम कर रहे हैं. हर चीज पर focus कर रहे हैं, cost पर focus कर रहे हैं. ये जरूरी नहीं कि सारा EBITDA सेलिंग प्राइस बढ़ाने से ही आएगा. कुछ cost control करने से भी आएगा. कुछ different type of work we are doing कि उसको बढ़ाने के लिए. Understood. And Sanjay Gupta, दूसरा question है कि अगर आप ये जो 400 crore बोल रहे हैं Q4 में और आपके volume पे, मतलब आपका 4,500 EBITDA per ton हो गया. So should we work with this 4,500 EBITDA per ton as the base for FY2026? My target is 5,000 minimum. Going forward 6,000. ये तो मैं फंस गया हूं, जो मैं अभी ज्यादा बोल नहीं पा रहा हूं. कि पहले एक बार इसको achieve कर लूं, फिर आगे की बातें करूंगा. मैंने system बहुत strong बनाया हुआ है. I'm not happy with 4,500 or 4,000, not my aim. My aim is minimum 5,000 and going forward 6,000. But ठीक है, इसके लिए थोड़ा सा external movement और external task चाहिए मेरे को. मैं 4,500-4,000 का बात नहीं करना चाहूंगा. समझ गया. तो मतलब in worst case also आपको लगता है you should be able to deliver 4,500 and उसके ऊपर से देखा जाएगा. Yes. मेरा minimum target 4,500. Going forward, मेरा minimum target is 4,500. क्योंकि हम जो भी policies internally निकालते हैं ना, we are doing our policies according to 5,000 per ton से हमारी policy बनती है. अब उसमें से फिर marketing team है, CEO है, हमारे जो marketing head हैं, balance लेवल के लोग हैं, RM लेवल के लोग हैं, थोड़ा बहुत discount pass on करते हैं. तो मैं इसमें था उनका discount का trend बहुत कम देख रहा हूं, जो regarding दिसंबर में था. समझ गया. Policy तो हम 5,000 से ही निकालते हैं. समझ गया. ठीक है. Thank you so much. Thank you. Next question is from Sneha Talreja from Nuvama. Please go ahead. Hi sir. Good evening and congratulations on great set of numbers. Just couple of questions. On the previous participant question, you said discounting कम हो रहा है. Versus Q3, where are we at this point of time? Sneha, abhi tak whatever trends we see in the first 20 days of the quarter, ongoing quarter, we see INR 100-INR 200 per ton discounting pull off kiya hai by our sales team. So currently we are at around INR 300 or so rupees discounting on the channel. INR 300-350, yes. Understood. Secondly, just wanted to take some flavor. I know you have been mentioning one fact that HRC capacities in India are getting added up. But what if still there's an ADD implementation? How do we make sure that the gap still remains? So just some comfort on this gap of patra prices and primary prices remaining. Yes. Sneha, see, I mean, the logic says that even with the ADD, there will be recovery, right? Not to the extent what we saw during COVID levels where HR quality prices started going above INR 60,000 a ton, and then Russia, Ukraine were taking HR quality to INR 70,000 a ton. That was the period which hit us the most, right? Whatever happens, right, at the policy level, we don't believe that the spike in steel could be to that extent. Number two, Sneha, in the secondary type of material, we never think about this product because वहां पर business हमारे हाथ में नहीं है. Business is the hand of the steel plants. और if you see, अभी तक JSPL का blast furnace चालू नहीं हुआ है. ये JSW का Bellary HSM-3 अभी stabilize हो रहा है. AMNS का blast furnace अभी अगस्त-सितंबर में आने का है. तो India में अभी capacity तो हल्ला हुआ है, build up तो हुई नहीं है. और जब ये capacity build up होगी, जब इनका cost of production secondary material से almost INR 10,000 per ton नीचे है, तो मेरे को secondary material को उतना बड़ा future, short term maybe there is a future, but मेरे को long term में कोई future क्योंकि सस्ता बिकेगा, महंगा बनेगा. तो ये business ज्यादा दिन मेरे हिसाब से sustain नहीं कर सकता. और India के अलावा आप देख लो, कहीं पूरे world में कहीं पर भी secondary business नहीं चलता है. Understood, sir. That was quite helpful. Thanks, thanks a lot, sir, and all the best. Thank you. Next question is with Pallav Agarwal from Antique Stock Broking. Please go ahead. Yeah, good evening, sir. I had a question on the realization. So this quarter, you know, on an average, HRC prices did fall from the previous quarter. But we have shown our blended realization. There's an increase over the Q2. So any particular reason for that? Is it due to our value-added products or what has led to the better realization? So if you look at our NSR, so if you look at NSR, there is stock in trade like in our cost, right, which you see. So if you remove that, then you don't see increase in the NSR. You're going to see it without increasing stock in trade. I have to reduce the stock in trade or the purchase even from the sales to come to the blended NSR. Is that? That is right. That is right. Okay, and will this trend, sorry, continue of external purchases because I would guess the margins over there would be lower than in-house products? Or this was more of a practical thing of short-term nature? Can you say it again, please? I'm saying, will this trend of higher purchase of stock in trade continue? Because I thought that margins on a trading portfolio would be lower than our in-house products. Of course. Trading is almost zero. Okay. So we did this because of to gain market share or any particular logic if it was not very profitable? No. So this is not manufactured product. This is raw material which gets traded, right? So 28,000 ton for the quarter three is our manufactured volume which we get. And you remove stock in trade from the revenue, you will get the NSR for the manufactured. Okay. So basically the stock in trade was HRC, right? Not the finished. That is right. Okay. Also, in our presentation, we're talking about the solar opportunity. So right now, what would be the proportion of volumes that go into the solar? There are three products which APL Apollo manufactured today, which go into the solar sector. One is from Raipur, which is our alu-zinc coils, which go into the solar mounted structures for ground mounted solar park, right? That capacity started six months back, and we have started selling specifically for the solar sector. Then there are some specialized tubes which go for the solar trackers, right? That's a slow-moving product. That's a slow-moving product because you need a lot of approvals from the consultants of the independent power producers who are installing solar trackers. Solar tracker anyways is a new product for the Indian market. Although we have exported a lot of pipes for international trackers, the Indian tracker market is very new, and it is expanding at a slower pace. And third product is our standard pipes, which go on the residential rooftop solar, right? They are replacing angles and channels. Again, what we are doing here is we are educating the EPC installers, EPC contractors who go over rooftops at residential terraces, right, and they install small solar plants, right? So yeah. So it's a new segment for us, but these are the three categories, and we are working across all the three categories to boost volumes. Right now, the proportion is small, but over the next two, three quarters, we see good volume coming from solar segment. Okay. Because I think the tracker, is that the top tubes that we are talking about, which we need approvals from? That is right. That is right. Okay. Because there, I think, again, the opportunity could be pretty big once we get the approvals in place, so. Of course. And again, here, the idea is to come up with just not run-of-the-mill tubes, which a lot of our competitors are in the market and selling run-of-the-mill tubes, right, where margins are very less. And they are selling to the large players, very large conglomerates who don't give margins, right, to their OEM vendors. So we are not talking to those large customers. We are talking to mid-size customers, right, where we help them with the design, right? So then they are bound to buy tubes from us at our margin. Otherwise, whatever some players are in the market trying to sell solar torque tubes, there is no margin which any large developer will offer. We also tried, but we backed out because margins were as low as INR 2,000 a ton. There could be some trade arbitrage some players may be getting if they have their mill near to the solar park, but otherwise, it's not a profitable segment with the large conglomerates. They have their designs, and they just ask you to roll the material to make pipes. Sure. Yeah. Thank you so much, sir. Thank you. The next question is from Bhavin Pande from Athena Investments. Please go ahead. Hey, congratulations on wonderful set of numbers. So when we look at heavy structural as a category, even when we look at difficult quarters we had, metrics are fairly consistent. So how do we look at the demand scenario here and the customer base that we have? Because it seems pretty much immune to demand scenario in the general space. You're talking about heavy segment, right? Yeah. Heavy and the premium products. Heavy and? The premium products. Premium products. Which segment are you referring to in specific? Coated in Apollo Z and Apollo Galvanized, yeah. Yeah. Okay. So see, heavy structural tubes are definitely prone to the macro environment because these pipes go into infrastructure projects like railway stations, airports, healthcare infrastructure, etc. Okay? So the first nine months have been tough in terms of demand from the infrastructure projects like any other building material. But because of our high market share, we've been able to grow this segment at 20% in the first nine months. Okay? Then comes the Apollo Z or light structural. This is a residential product, okay, which goes into homes. This is part of our 60% of our portfolio which goes into residential homes. Now, again, the demand from retail side has been weak over the last three or four quarters consistently, right? So here also, we are not getting any tailwind as such, right? We expect consumer demand to pick up from the second half of the current calendar year. Then we'll see good pickup in light structurals and Apollo Z. Light and Apollo Z are maximum going into residential segment. Another one, when we look at our ability to penetrate into markets where the market still has not grown as there's no mature market like we are doing for eastern markets, so is it safe to assume that we can put up more plants wherever we feel that demand visibility is there? The Eastern market, we are starting with two new plants, right? Normally, any company would go for one plant, right? But we being Apollo, we are straight away putting up two plants, right? One in Gorakhpur to capture Eastern UP, Bihar, and Orissa belt. Orissa belt. Eastern UP and Jharkhand, sorry, right, and then we are putting up a plant in Siliguri, which will take care of these seven sister states, right? And Bengal. Some exports maybe to Burma, etc. Ghana. Bhutan. We keep on getting good inquiries from there. So yes, I mean, the idea is to seed in these plants first with minimum investment. I mean, the response would be good because our market share in that market is very low, right? And then we don't mind expanding capacities as our plants ramp up. That has been our strategy, right? We go slow, and then we become aggressive once we see the trends for market share gains. Thank you. Before we take the next question, I request two participants to please limit your questions to one per participant. The next question is from Andre Purushottam from Cogito Advisors. Please go ahead. My questions have been answered, so thank you. Thank you. We'll move to the next question. The next question is from Aditya Welekar from Axis Securities. Please go ahead. Yes, sir. Just one clarification on the residual Capex. So in the last quarterly call, it was near about INR 3-3.5 billion. And now it's INR 5 billion. So that is for the capacity expansion. Earlier, it was 5 million ton. Now it is 5.5 million ton, right? Is my understanding correct? Yes. Yeah. That's it from my side. Thank you. Thank you. The next question is from Arpit Kataria from IGE Family Office. Please go ahead. Yeah. Hi everyone. Congratulations on a great set of numbers. My question is, as you highlighted in your opening remarks about the scarcity of raw material availability in our Raipur plant, so what exactly is that raw material and how scarce it is, and what the company is doing to mitigate the same? So see, that was a minor shutdown from Tata Steel plant, which impacted our volume. So this was not a significant loss, right, to the volume, which would have made us to change our strategy in sourcing of steel. Yes, I mean, the volume could have been higher by 5-10 thousand tons, right? But it is stable now. From January onwards, it's been pretty stable. Okay. Great. That's it from my side. Thank you. Thank you. The next question is from Manan Shah from Growth Sphere Ventures. Please go ahead. Hello. Hi, sir. Good evening and congratulations for a great set of numbers, so I just wanted to understand, as the demand is shifting from, say, secondary pipes to HR coil pipes, how do you see narrow-width HR coil pipes as a market? Because there are competitors emerging from that area as well, and the pricing is very much similar in the market to HR coil pipes, so just wanted to understand your view from competition perspective of that particular segment. You mean the patra, right? Narrow-width HR coil. Yeah. There is no quality of narrow-width HR coil. Either there is HR coil or either it is secondary. Whatever you say, narrow-width, patra, secondary, whatever. But there is only two types of material in the market. One is primary, one is secondary. Okay, sir. Got it. Yeah. Thank you so much. Thank you very much. We'll have to take that as the last question. I would now like to hand the conference back to the management team for closing comments. Thanks, everyone, for dropping by and listening to our Q3 Investor Call, and thanks to B&K for hosting us. Look forward to speaking to everyone during the next call. Thank you so much. All right. Thank you very much. On behalf of Batlivala & Karani Securities India Private Limited, that concludes the conference. Thank you for joining us, ladies and gentlemen. You may now disconnect your lines.