Please note that this conference is being recorded. I now hand the conference over to Mr. Vikas Singh from PhilipCapital (India) Pvt. Ltd. Thank you, and over to you, sir. Good afternoon, everyone. I warmly welcome everyone on Jindal Saw Q1 FY25 results conference. From the management side, today we have with us Mr. Neeraj Kumar, Group CEO and Whole-time Director; Mr. Vinay Kumar Gupta, President and Head Treasury; Mr. Narendra Mantri, President, Head Commercial and CFO; and Mr. Rajiv Goyal, Vice President, Group Corporate Finance and Treasury. Without taking any much time, I'll hand over the call to Mr. Neeraj Kumar for his opening remarks. Over to you, sir. Thank you, investors. Today, what I propose to do is probably I'll keep my initial introduction a little short, and would take more questions. My only request to all the participants are, please keep all your granular level questions for the side that may not be relevant to the entire audience. Because where I would like all my stakeholders, all the people who are on the call, who are taking interest in Jindal Saw, to look at the broader picture from where we came or where we arrived thirty-first March 2024, and what is the journey now we have set ourselves up for. And therefore, after my initial observations or comments on the first quarter, I would like to spend some time giving you that broader picture, and then I'll stop to take some questions. Also, I would request the moderator that, it's 4:40 P.M. now, let's have a hard stop at 5:15 P.M., because today we also had the Jindal Hunting Board meeting, and the chairman, Hunting Global Chairman, is down here from the U.S., and therefore I need to spend some time with him. So 5:15 P.M., we will put a hard stop for today's discussion, but obviously we will be available. We can always exchange mails, have another round of discussions for others. So with that, this quarter standalone, we ended up with a top line of INR 4,417 crores, an increase of 15%. Straight away, I am jumping down to EBITDA INR 842 crores, as compared to INR 614 crores, 37%. PAT INR 446 crores, as compared to INR 279 crores, 60%. Look at the trend. Top line, 15%; EBITDA, 37%; profit, 60%. Together, let's look at the consolidated. INR 4,985, as compared to INR 4,447, 12%. EBITDA, INR 885, as compared to INR 645, 37%. PAT, INR 416, as compared to INR 245, 70%. So the trend is similar both places. And if you see the cascading, something that I have been mentioning many a times, that the company is consciously moving towards value add. That's beginning to show up. And we are consistent in showing this up. As I said, 31st March 2024, was best ever after a best ever. So the previous year was the best ever, then we achieved the best ever. It looks like now we are in line to do it three times in a row. This should be again, the best ever. One more benchmark that we will set for ourselves. Plus, if you see the EBITDA to sales ratio has also moved, improved upwards. The other important aspect... So this is on the performance. The other important aspect that also I would like to point the attention of my stakeholders, shareholders. The debt. On a standalone basis, June 30th, March 31st, INR 3,200 has gone up to INR 3,900, primarily because the term loan has come down from INR 1,760 to INR 1,400, but the working capital has gone up from INR 1,500- INR 25. Primarily because now we are preparing for... We are building momentum. We are preparing for a better execution throughout the year. We are making sure that the commodity prices are moving within a reasonable range, so we lock it. There is a reasonable indication, the way it is looking, we can see it in the first quarter itself, that this year is likely to be again, probably a new benchmark for best so far. Now, look at the larger picture. Continuity in governance is there, even though this is not an absolute majority government, but nothing is showing the government or indicating that the government is becoming weak, or the government has become compromising. Obviously, they are doing a few things that they need to do to keep everybody happy. But slowdown or weakness or getting pulled in different direction is not indicated. Look at the capital spent for allocation for the budget, INR 11,00,000 crore. That's music for us. A lot of things that the general budget has indicated is all music for us, and we are also seeing all of those translate into ground. So the first big picture, continuity and continued focus on infrastructure. Second, important, our entry in premium segment, we are absolutely running full capacity. I would be very happy to let all of you know, I just attended the first quarter board meeting of the JH ESL joint venture. They are profitable in Q1 itself, operating at a capacity of more than 80%-85%. We are super blocked. In fact, this time the board was interested in even looking at what else we can do to cater to the market. So this JV may have the board has assigned the responsibility to a small team constituted. The board may have to look at some proposals and there could be some announcements. So team have been constituted to look at- because already the order book is pretty full for the rest of the year. Productivity is good. Rejection has come down to less than 2%. So on all parameters, all boxes are beginning to get ticked. Likewise, in tenders, we have started the instrumentation tube, a huge high value, good market, and we are beginning to do that. We are also looking at a few, other value adds. So those businesses are beginning to provide value to the, company. Sathavahana, again, has turned profitable. Very high capacity. We are doing debottlenecking, where the capacity is going to go up by 10%-20%, at least. We are creating a special niche for lower diameter, which has a very high demand and a high value. Also export, unit is being looked at because they have some special requirement of coating, et cetera. So all these new areas where the company has gone in, they are all beginning to do well or they have already started doing well. Our traditional business, we continue to do good job in terms of quality, delivery, service. Demand is already there. We have a very healthy order book. If you see at this point of time, the order book continues to grow. Whatever we had a quarter, we have added something more to it, and the execution is also healthy. So on all fronts, Jindal Saw is doing reasonably well, as is expected, and we are committed. We will continue to stay focused. So with this, let me thank all of you for your interest. I keep on saying this, and all of you had to be a lot patient, but now we are happy that we are doing well, and also, we are being seen as doing well, which is reflected in the market cap. The rating agencies, the banks, everybody is with us, and they are appreciative of all our great efforts that we have had, the whole team has done over the last one year. Let me stop here. Thank you very much. Let me take few questions. Thank you. We will now begin the question and answer session. Anyone who wishes to ask question, may press star and one on the 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. ...Our first question is from the line of Deepak from Unifi Capital. Please go ahead, sir. Hello, sir. Congratulations on the good set of numbers. So my first question is on the business split between water and oil and gas, both for India and the UAE subsidiary. Sorry, could you repeat your question, please? Sir, I would want the business split between oil and gas and water, in our Indian business. Between oil and gas and water. Just give me a second. Yes, sir. Okay. This is our order book. Order book, I would say, oil and gas is about 30%-35%. Water is rest. Industrial sector is a very small. 70% is water? 70% is water. That is 25% and 5% is- 5% others, and the rest is oil and gas. Okay. What would be the split in the UAE subsidiary between oil and gas and water? Now, again, probably you are not very audible. What is the split between? In the UAE subsidiary, what will be the oil and gas and water split? No, no, no. UAE is only water. It is only a DI facility. Okay, understood, sir. UAE is 100%, DI, only water, and they are also doing well. This year, they should, you know, hit a good capacity, more than 200,000 tons, for sure. Sure. Understood. Sir, I had a broad question on the water infrastructure today. So we understand that Jal Jeevan is, you know, doing well for our DI pipes capacity, but the SAW pipes, which is at lower utilization today for, for your company and the entire industry, you know, and it's a state affair where we, you know, cater to into irrigation projects, to, you know, smaller, you know, in river linking projects. So is the dynamic there on the demand side changing significantly, you know, which is giving us, some sense of secularity in these order book? So just needed some input from your side on the, the SAW pipe demand for water. Yes. Okay. Is SAW pipe for demand, demand getting sluggish? No. Are we worried about that it is having a hard landing? No. Sometimes there are some spacing that happens in between tenders, and therefore, you may have some small bumps, but definitely it is not a trend, and at least we are hopeful. The way I see it, at present, we have more than 650,000 tons of order for large diameter pipes. And it doesn't show that we are going for a, you know, difficult... Okay. Sir, has anything changed on the, macro side, which is giving you this confidence that, you know, nothing will go bad? From the state government, are you, is there an understanding that the infrastructure has to be built up? Is any sort of color that you can give on this? Government of India has come up with a, I would say, a balanced scheme, where most of these projects of great importance, they participate, but their funds get released only if states bring in their contribution. Now, that, in a way, forces the states to match the contribution, otherwise, they run the risk of losing that budget allocation. And that is making sure that the projects are on track, the investment is on track. Only state government projects are not very many, and therefore, our focus is largely on projects which are funded by multilateral agencies and projects which are either center or central state partnership. Because there we are seeing the progress, the allocation, everything in better than just solely state-managed projects. But some states, again, are doing well there as well. Okay. Yeah, that was, that was pretty clear. Sir, in our export business, you know, what is driving that? Is it oil or is it water? And if you can explain which geographies and what is the macros in the export division. See, export at this point of time, we are maintaining almost 70/30 ratio, which is a good sweet spot for us. Export, largely, water sector goes to Middle East. Oil and gas, we do across the globe. Because water sector, you know, the pipes are of very large diameter, so there is a freight kind of limits the distance that we can take those pipes. In DI, we don't export much because we have our Abu Dhabi facility. Imports are largely by LSAW and HSAW. HSAW, primarily towards Middle East, LSAW, oil and gas all over the world. Understood, sir. Sir, since you're, you know, getting good orders and, you know, there is some bit of visibility which is better than the past, any CapEx that you seem to be requiring for the business, at least in the DI pipes, where we are running at 100% utilization. Any big CapEx apart from the debottlenecking? No, we have not announced any project as yet, so we don't have. But see, when the company starts doing well, and we are at this point of time conserving capital within the company, therefore, the dividend distribution we have improved, but still, probably people would have expected more. Primarily because we are trying to conserve money, building reserves, and keeping ready. So we are exploring possibilities, but no project has been announced as yet. Sure, sir. So one last question from my side. You mentioned that the loans have gone up, and the debt you've taken to lock in raw material prices. So how many months of coking coal or steel have you locked in for our project requirement? The coking coal, we normally get four shipments a year, and we like to keep one ship on the sea, more than one and a half ships in the yard, so that, you know, we don't have any disruption. And as far as the steel is concerned, we don't, you know, block steel like this. We keep steel, which is project-wise. So steel manufacturing or steel storage raw material is project-wise. We try and lock in for the entire project because a lot of our project revenues are fixed revenues. Therefore, not to get into the trap of a moving commodity price, we try and go for the project. Coal, as I told you, are bulk, sometimes iron ore or coal. Wherever we import, we try and maintain a cycle, one ship in the sea, at least one ship in the yard. That's how it works. Understood, sir. There are many... I have more questions to ask, but I will join back in the queue. Thank you, sir. Look Look forward to meeting you. Thank you. Thank you. Thank you. Our next question is from the line of Radha from B&K Securities. Please go ahead. Hi, sir. Thank you for the opportunity, and congratulations on very good results. Sir, my first question was on the stainless steel side. So two years back, we had estimated that on the stainless steel front, we could do an EBITDA of INR 300 crore. So where are we in terms of stainless steel now, and when can we reach our full potential? Madam, probably you are new to our call. We'd never discuss segmental EBITDA on any investor call. We have only two business segments: one is pipes, which is the entire range of pipes, and pellets, but that, again, is only for the purpose of tonnages. EBITDA, segmental EBITDA, we do not discuss as a matter of principle for the company. Sir, actually, we stopped bifurcating from 1Q FY 2024, so I was talking prior to that. Madam, please appreciate, I know not having a segmental EBITDA, sometimes the analysts may find it a little difficult. But please appreciate, since you are interested in this company, if I'm giving you a 19% EBITDA to sales margin, please understand, as a stakeholder, I am protecting your interest. And this is a USP which we have, which helps us do many things in the business in terms of pricing, entry, that others are not able to do. And therefore- Yes, understood. Maintain this USP that we have, so that we continue to create value for our stakeholders. Okay. Sir, if we can understand, at least in terms of the capacity side, so how much of the 30,000 metric tons would be welded and how much would be stainless? And previously, you had also mentioned that we have both hot extrusion as well as piercing. Hold, madam. Let me just be with you on the number. You mentioned 30,000 where? Where is 30,000? Stainless steel. Metric ton capacity. Capacity, sir. Capacity of SS. Where did you get this 30,000? From the annual report, sir. Historical annual report. Historical, madam, I don't remember. Since I don't remember, I would not like to speculate and give you a speculative answer, because stainless steel... Okay, let me at least give you a sense of what, our stainless steel, business is.... Our stainless steel business is, distributed in three locations, and that's why I'm surprised, where did you get this capacity from? It has got three locations. Nagothane is extrusion. Samaghogha is welded large dia, going up to 70 inches in diameter, and pilgering for large, diameters. Kosi is the sophisticated small diameter welded as well as seamless. Now, if you look at my large diameter, the 70-inch steel, stainless steel pipe that I can make, if you talk about the capacity, it has a huge capacity. But there is no point in talking about that capacity, because that kind of utilization, at least at this point of time or in the near future, we don't even expect. Also, whatever gets extruded in Nagothane can either be sold directly into the market or can come to Samaghogha and Kosi for further processing. So again, the extrusion capacity and the capacities at Samaghogha and Kosi, would you treat it as one integrated or are they separate capacities? Because Nagothane also has a market and also has supplies to these. So therefore, these... See, there's a reason why we don't declare all this or we don't put it out in the market. Because eventually, as an analyst, I would be putting you on the wrong path, because you will not have these minor, you know, finer points, and therefore you'll go wrong. See, Nagothane can feed both Kosi as well as Samaghogha, and it can also straightaway hot finish goes into the market. So any indication about any of the equipment capacity is absolutely will mislead you for the capacity of my entire SS business. You get my point? Yes, sir. Okay, understand. Yeah. Okay, next question is on the- Good. Largely, what we are going to achieve in our stainless steel this year would be somewhere around between 20,000 and 25,000 metric tons of steel, stainless steel, welded and seamless, would be in the market or would be sold in the market. That much at least I can tell you, which will be a combination of all these capacities that I have at all over the place. Okay, sir. That's very helpful. Thank you, sir. Second question was on the Hunting front. So, the press release mentions that we have 70,000 capacity. So, and I understand that this is an import substitute product. So could you mention what is the industry size in India and our expansion plans, if any, on this? What the industry, what? Sorry. what? Sorry. Industry opportunity size in India. Roughly, OCTG, annually, $200 million are getting imported per year, putting ONGC, Oil India, Reliance, Vedanta, all put together, $200 million. At this point of time, our facility, as I already said, is more than 85% plus capacity utilization. We are catering to a few segments of ONGC 100%, especially the casing, et cetera. Tubing, they still have more. Plus, on the East Coast, there is some import, which is happening still. But we are likely to prepare ourselves such that we make India atma nirbhar in OCTG market, is something that we have discussed in the board, and we would work towards it. Let us see this committees of experts, once they come up with a report, what does it say? What is the current realization on these products? Average. Average realization of what? Of the products that we sell from Hunting. Again, see, the kind of question that you are asking me, you know, I don't want to mislead you. The grades that I supply to ONGC is Thirteen Chrome. Thirteen Chrome is INR 600,000 a ton. I supply Q125, which is probably INR 300,000 a ton. And we also do some P110, and we also do some other lower grades, which will be in the range of INR 200,000. So tell me what, what in exact should I give you? Sir, on the basis of sales that we have booked this quarter, we just wanted to understand average realization, what it would be? The products which could depend on that. I, I gave you the range. And again, if I don't want to... Because these are all getting recorded. Suppose, this is all tender-based business. I give you my last quarter average.... a certain because it's a combination of these three in a certain proportion. Next quarter, the proportion changes because the tender changes. Next quarter, if you ask me the same question, I'll have to give you a separate, different answer. And then you will say, "Okay, why there is a disconnect between these two?" Because my product mix has changed. See, today, what Jindal Saw is focusing on a full range. In fact, today we were talking about Super 13 Chrome, which is 15 Chrome, because now we are successful in 13, so we want to go to 15. And we also do the basic carbon steel- Sir, the participant has been disconnected, sir. Thank you. Are there any more questions from the moderator? Yes, sir. Yes, sir. Priya, ma'am, please go ahead. Thank you for giving me the opportunity. So in Sathavahana, we are seeing this demand coming in, and we had also said that a new CapEx will be coming in next year. So when around next year we'll see this coming? What? Coming, what? Uh, Satvana. No, Satvana, madam, we already have a very healthy demand. We are operating at 80, 80, 80 plus. This year, probably we will cross 200,000 tons of supply for sure. Mm-hmm. We are now debottlenecking where by just making sure that all the balancing equipment is there, we are trying to maximize everything around the hot metal, because we have a [inaudible] which has a certain capacity. Yeah, so it's actually talking about the debottlenecking only, and in terms of- That will, that will be 2.5. It will take the capacity to upward of 250,000 tons. We are currently operating at 2+ already. It's doing well. So that's the headroom for next year, probably we'll be at 2.5. In terms of order book, $1.6 billion, what volumes are there in totality across all your pipes? You are talking about what? Oh, tonnage you are talking about? Yeah, tonnage, tonnage. That's about 1,600,000 tons. INR 16 lakh, okay. And, in UAE, what kind of export geographies are we looking at? Is it mainly Middle East and- No, no, no. UAE, okay. UAE, the market is, we have gone right up to Norway. We give them those special cladded pipes, which is used in very winter conditions. In the west, we go down as far as Brazil, Chile. In the east, we go down and as far as Australia, because our DI facility in Abu Dhabi is very versatile. It can do double chamber, it can do diameter up to 2.2, which is a unique thing. In India, we can do only 1.2. In- Okay. Abu Dhabi, we can do 2.2 m, and therefore, we have a very wide. If I remember correctly, probably over 30 countries for sure. Probably, we have put our products from Abu Dhabi has gone to, at some point of time, over 33 countries. Got it. In terms of tonnage, how much would be there from UAE, in terms of order book? This year, we should, we should cross 200,000 tons for sure. Okay. So the order book has 200,000 tons. The order book is more, but I'm talking about this annual, this year, we should do more than 200,000 tons of dispatch. Okay. And the order book is $251 million for how much tonnage? 251 tonnage. INR 225,000. It is 2:25 P.M. INR 225,000. 225,000 tons. Order book is INR 251 million. We will cross 200,000 tons this year for sure. So this year, my revenue should go beyond INR 200 million for sure. Right. And in terms of execution, so there will be a lot of EPC water. EPC players are saying that there has been slowdown in the ordering or the execution happening. So are you seeing similar trends in domestic contractors? This is, this is just tender specific, because budgets have been announced or budgets have happened just now, which should happen in February, but because of the elections. So many of the state governments or many of the projects are yet to get their budgetary allocation, so it's a temporary blip. We hope that there would be catch up, because we don't see a downward trend, trend in the water infrastructure. But this temporary blip is only because of the budgetary allocation getting delayed by a few months. Hmm. Got it. Got it. I I think that's it from my side. I'll join back in if you have further questions. Thank you. Thank you. Moderator, can I take the last question, please? Yes, sir. Our next question is on the line of Shweta Dixit from Systematix Group. Please go ahead. Hi, thank you, but my question is already answered. Thank you so much. ... Our next question is from the line of Hitesh from ULJK Securities. Please go ahead. Hello, good evening, sir. Sir, I want to ask that, this tender-based business, so what type of benchmark is? I don't get you. Sir, as the business is tender-based business, so what type of benchmark are taken care to set the prices of pipes? What kind of a benchmark, means what? Means to set the prices for tender. So what type of- Boss, I'm really sorry. For setting the prices for pipes. Boss, I'm really sorry. Do you want me to discuss my pricing strategy on an investor call? No, no. Probably then I don't get you. What is the margin? How do I set my prices? What do you expect me to say? Yeah. Yeah, yeah. Which type of—I mean, what index do you take, consider to set those prices? Without giving you any numbers, I'll give you the concept. Yeah, yeah. Raw material price, we build it up to landed price. We add for the time value for money. We add for the minimum profit that we require, and then we add or subtract the strategic value, because as I told you, and that's why we don't discuss EBITDA anywhere. Because suppose if I must win this, then maybe my strategic input could be reducing this a little bit. If I want to scheme, then the strategic input will be adding a little bit. So once I stack up all this, I get my price. But obviously, don't expect me to discuss my pricing strategy on which tender, how do I build my price? Okay, it's fair enough, sir. Thank you. Thank you. Thank you, moderator, probably- Okay, okay. The time I had set for this call is up, so would you please thank, everybody on my behalf? And, I would like to assure all my stakeholders that we will continue to do well. We will continue to create value. We are all the time looking at businesses very carefully, at costs very carefully, markets very carefully. Great. Make sure that they are there. So with this, hope to see you all next week. Thank you all. Thank you very much. Sorry, next quarter. So hope to see you all next quarter. Obviously, most of you are free. All of you are free, and welcome to connect with Rajiv Goyal and his team for any other specific questions and answers. So thank you all. Thank you very much. Thank you. On behalf of PhilipCapital-