Welcome to the Tube Investments Q2 FY 2026 earnings call hosted by IIFL Capital Services Limited. All participants are currently in listen-only mode. There will be an opportunity to ask questions following the conclusion of the management's opening remarks. Please note that this conference is being recorded. I now hand the conference over to Mr. Joseph George from IIFL Capital. Thank you, and over to you, sir. Thank you, Inba. On behalf of IIFL Capital, I welcome you all to the 2Q FY 2026 results conference call of Tube Investments of India Limited. From the management, we have with us Mr. M. A. M. Arunachalam, Executive Chairman, Mr. Vellayan Subbiah, Vice Chairman, Mr. Mukesh Ahuja, Managing Director, Mr. A. N. Meyyappan, Chief Financial Officer, Mr. Shivdeep Singh Jammu, Division Head TPI, Mr. M. Shivakumar, Division Head MFPD, and Mr. U. Rajagopal, Division Head TI Cycles. We also have with us Mr. Jalaj Gupta, CEO TI Clean Mobility, Mr. S. Gopalakrishnan, CFO TI Clean Mobility, and Mr. N. Govind rajan, CEO Triyom Innoventure. I will now hand over the call to the management for opening remarks, post which we will have Q&A. Yeah, thanks, Joseph. The Board of TI met today and approved the financial results for the quarter ended 30 September 2025. Standalone results for the quarter revenue in Q2 was at INR 2,119 crores compared with INR 2,065 crores in the same period previous year. EBIT was at INR 250 crores compared with INR 225 crores in the same period previous year, which is a growth of 11.5%. ROIC was at 44% for the quarter compared with 45% in the same period previous year, and free cash flow for the quarter was at INR 183 crores. A quick review of the businesses: engineering revenue for the quarter was at INR 1,382 crores compared with INR 1,323 crores in the corresponding quarter. EBIT was INR 164 crores, as against INR 162 crores in the corresponding quarter. Metal formed products was at INR 408 crores compared to INR 404 crores in the corresponding quarter previous year, and EBIT was at INR 44 crores versus. As compared to 46 in the corresponding quarter for the previous year. Mobility business, which is a bicycle business, was INR 194 crores compared with INR 168 crores in the corresponding quarter in the previous year, and EBIT was at INR 4 crores as against a loss of INR 0.36 crores in the corresponding quarter. The others, revenue for the quarter was at INR 227 crores compared to INR 243 crores in the corresponding quarter, and EBIT was at INR 18 crores compared to INR 9 crores in the corresponding quarter. At a consolidated level, consolidated revenue was at INR 5,523 crores as against INR 4,925 crores, and the profit before tax for the quarter was at INR 459 crores as against INR 426 crores in the corresponding quarter. CG Power had a consolidated revenue of INR 2,923 crores and a profit of INR 388 crores compared to a revenue of INR 2,413 crores and INR 294 crores in the corresponding quarter. Shanthi Gears. Had a revenue of INR 132 crore, which was up against a revenue of INR 155 crore in the corresponding quarter, and EBIT was INR 29 crore compared to INR 34 crore. Let me stop with that, Joseph [audio distortion], and be happy to turn it over to the audience for questions. Thank you very much, sir. Ladies and gentlemen, we will now begin the question and answer session. Anyone who wishes to ask a question may click on the raise hand icon from the participant tab on your screen. We will wait for a moment while the question queue assembles. Any participant who has a question may click on the raise hand icon. We have the first question from Siddhant Dand of Goodwill. Please go ahead. Am I audible? Yes, sir. Yes. My question was regarding our metal formed products division. What is the industrial chain? Because we have not grown this quarter year-on- year. What is the market size of the industrial chains and other businesses over here? Even the two-wheeler chains, and have we lost market share over there? Let's say, like your question was one on the auto chain side and another is on the industrial chain side. Yeah. Just to clarify, industrial chains falls in the others category. And auto chains falls under metal form products. Okay, so. Okay. I think if your question's around auto chains. Around both of them. Okay, so he's asking for chains in general. Okay, so we can talk. Chains, our market share is intact. Rather, it is a marginal, there is an improvement in that. And industrial chain also has done pretty well last quarter. There also, maybe, let's say, market share is well maintained to answer your question. Okay, what is the total market size in industrial chains? Industrial market size is about INR 900 crore, and we do almost maybe let's say close to 50% share in that. Okay, understood. That's very useful. How much would the export market be over here? As a part of industrial chain? Yeah, export share of our revenue. We exports maybe do as a total TI about 15%, and maybe as of now we don't share the breakup between engineering division and the industrial chain, which basically does both. At a TI level, we do about 15%. Okay, understood. Thank you so much. Thank you. Before we take our next question, we'd like to remind participants to ask a question. You may click on the raise hand icon again. Our next question is from Joseph George of IIFL. Please go ahead. Thank you. I have a couple of big picture questions. One is, when the government announced the GST cuts, the hope was that it will trigger consumption, it will boost the overall GDP growth, etc., etc. From your company's perspective, compared to the growth that you were expecting for your businesses, I mean, you don't have to quote numbers, but compared to the growth that you were expecting for your businesses, say three months back, and when you look at the situation today, again, when you look at the growth forecast for each of your segments for, say, FY 2026 or FY 2027, are you seeing a significant upgrade compared to what you were seeing, say, three months back? Without quoting any numbers, but just to give you a get a feel. Joseph, thanks for your question. Like you are aware of, TI is mainly dependent on auto as well as non-auto. If I discount the September first half, where the 22nd September GST rates changed, after that we see a real uptick in demand, which can be coupled with the festival season also. October as well as November, both seem to be very, very strong months, like earlier festival months used to be, but this time it is much better. Let's see going forward how it is going to sustain. That we are seeing collectively, but as of now, there is a good uptick in demand. Okay. The second question that I had was also in relation to GST. After the GST cut on ICE vehicles, the relative attractiveness of EVs from a total cost of ownership perspective or the initial acquisition cost perspective would have relatively reduced. Are you seeing any impact on your EV sales because of ICE vehicles becoming cheaper? Yeah, so Joseph. There is definitely an impact of the ICE becoming slightly more attractive versus the EV vehicles post the GST reduction. However, the impact varies from businesses to businesses. For example, in the e-tractor business and the small commercial vehicle business, the impact is minimal and is recoverable in two to three months from a total cost of ownership perspective. In the case of the three-wheeler business, where we see the impact is the highest because the diesel that translates to almost INR 20,000 for an ICE vehicle from a customer price point perspective. There we are seeing the ICE industry growing much more as compared to, let's say, the last month, as compared to, let's say, what the EV industry grew. When it comes to our bigger M&HCV business, which is the IPL tech business, over there, it's not. Impacting simply because the customer takes the GST as the input credit. So it varies. Overall, we'll say, is there an impact? We'll say. From an electrification point of view, perhaps a minor impact for a three-wheeler business. Otherwise, it's all well manageable. Understood. Thank you. I had two or three other questions in relation to the EV business. I'll just take them one by one. In the past, for the EV segments, trucks, three-wheelers, SUVs, etc., you used to share the volume number for the quarter. If you could do that for this quarter, it will be great. Yeah, so. Yeah, you want for the quarter two, the volumes for the businesses? Yes, for the second quarter, if you can share the volumes for trucks, three-wheelers, SUVs, tractors, etc., which you have done in the past as well. Sure. For three-wheeler, it is 2,082. For HCVs, it is 44. For small commercial vehicles, it is 167. For e-tractor, it is 100. Perfect. Great. Two more questions. Yeah, sorry. Yeah, from a revenue perspective, Q2 was. One of our, perhaps one of our best quarters up till now for the business. We were up vis-à-vis quarter two of last year by 21%. We were up vis-à-vis quarter one of this year by 31%. Great. Just two more questions on EVs. One is. Would it be possible for you to share the cash balance in TICM now? Maybe at the end of 2Q. No, we don't share specific data on that, Joseph. I think kind of. We don't share it. No problem. The last question on EV was, based on the current cost structure, what are the monthly volume levels for each of these segments where you can hit maybe EBITDA breakeven? It's a bit early to tell, right? I mean, basically, when we, I mean, because honestly, I've given an estimate in the past and I've been wrong, so I'd rather kind of err on the side of caution here. Till we get to a stage where we're comfortable giving numbers, when we're getting this thing, we don't want to share at this stage. Sure enough, sir. Thank you. That's all I had. Yeah. Thank you. We take the next question from Vipul kumar Shah of Sumangal Investments. Please go ahead. Hi, sir. Thanks for the opportunity. I'm sorry, Mr. Shah, we are unable to hear you. Yeah, am I audible? Could you come a little closer or increase the volume of your microphone? Okay. Is it better now? Management, are you able to hear them? You're Mr. Vipulkumar. No, we're not. Yeah, maybe. Yeah. Yeah, so can you. Yeah. Go ahead, go ahead, sir. For engineering division, sir? Yeah, Vipulkumar, can you come one question once again, please? We did not hear you. Can you share the volume growth for engineering division, sir? It was growth, the growth or growth of how much percent? On volume terms, it is around 10%. 10% as compared to same quarter last year, sir, right? Sir, that's right. Okay. Export volume growth? Exports maybe in particularly Q2 was a bit slower, particularly in the U.S., but rest of the geography, it was okay. Do you share tonnage in engineering division or you would not like to share? Generally, we export, we share as a total TI, which is about 15% like we shared earlier. No, no, I'm talking about enter engineering division. Can you share the tonnage? We don't share the tonnage generally. Okay, sir. Thank you very much. Thank you. Thank you. We'd like to remind participants to ask a question. You may please click on the raise hand icon so that we can unmute your connection. We'll take the next question from Joseph George of IIFL. Please go ahead. Thank you. I had two, three more questions in relation to the standalone business. One is we have seen strong growth in the mobility segment. I wanted to understand what strategy is playing out. Is it entirely driven by market share gains or are you seeing a revival in the end market? If it's market share gains, what is the strategy behind it that is playing out? Joseph, in mobility division, our focus was more towards the specialized bike, and we launched even the e-bike. We are a bit focusing going forward on the fitness side of the business story. This led to the margin improvement. Regarding your question, whether it is sustainable, yes, we feel it is sustainable. That's great. Two more questions on the standalone side. One is, could you talk about the impact on exports to the U.S.? I know exports to the U.S. is a relatively small piece of your business, just about 4% of revenue. However, since the increase in tariffs to about 50% sometime in August, we understand that a lot of exporters are struggling with volume dips of 70%-80% year -on- year, etc. Could you give an update on the situation there? Joseph, there, wherever we are supplying to the OEMs, which maybe approval process is also quite longer. That is how it gives an advantage in this kind of a time, where the business is sticky for some time, surely. Wherever the distributor market is there, we see a bit of slowdown. Overall, maybe like you said, our US impact is around 4%-5%, which is in Q2, we see a bit of slowdown about 10%. Let's hope going forward we will be able to maintain that. Great, sir. The last question that I had on the standalone piece was on the railway business. I think that is a segment that you had mentioned that you've got a strong order book, and we were expecting the revenues and the growth to kick in starting fourth quarter. If you can give an update on the railway business, that would be great. Joseph, like earlier, we maintained that business will start in Q4. We met our customers, maybe I met them even last week. We see there will be a delay of about one quarter because other suppliers' supply chain is not ready as of now. From TI perspective, we are ready. We see about a quarter here and there gap going forward as per our customer projections. Understood. Thank you. That's all I had. Thank you. We take our next question from Salil Desai of Marcellus. Please go ahead. Mr. Salil Desai, could you please unmute your connection and ask your question? Right. Hi. My question is for Jalaj. Volumes on the EV businesses that you gave, right? Now, if we just look at individual segments, then three-wheeler growth is just about 2% year-on- year. And in trucks, it is just about 5% for this quarter. So could you give us some color on how the market has been and how are you looking at either market share or any strategies on how you could accelerate this volume growth? Because EV is in adoption mode, I'm assuming that the pace of growth should have been much, much faster. Yeah. Okay. So Salil, on the truck side of it, definitely we are seeing competition coming in. In the big truck segment. As we speak, there are about seven to eight players who are now active in the market. Having said that, still for H1, we had a 50% upwards kind of a market share. We held on to market share of 50%+. We have our plans in terms of introduction of, so for the month of September, we introduced a 4x2 variant. We also introduced a swap technology on our 4x2 as well as 6x4 in terms of our product. We have Timber as a product which is lined up for introduction in the market in the quarter four of this year also. We have our plans, including some of the other market interventions and some of the earlier wins, which we have gained from 300 plus trucks, which are already running on the road. When it comes to three-wheeler business, yes, you are right. We would have wanted to scale up our volumes much more than what we have been able to. There have been some product concerns, which we have now put together. The new variant with all the improvement we have put out in the market last month only. Hopefully, going forward in the L5M category of product, you will see the uptick in terms of the volume. We are also planning to enter into the cargo as well as the L3 segment towards the end of the year. Overall, three-wheeler business, we will see the uptick, if not in quarter three, definitely from quarter four onwards. Understood. Thanks. My second question is on the medical division. Right now here, revenue growth has again been flattish year on year. At least for the last three, four quarters, we haven't really grown much. How are we looking at this business? What is the potential? Is there any new product gains, any new markets that you think can take us from these almost endemic growth rates to something which is much better? Your observation is right here. In particularly September month, we have seen a bit of slowdown because of the GST impact. All dealers and maybe hospitals slow down on the, particularly, offtake of the orders. We feel maybe it'll get compensated in the month of November and December going forward. We are working on new product development also to enhance the revenue going forward in TI Medical. Any qualitative targets that you can put in mind? What would you be happy with? Currently, we are targeting growth of 15%+ for the surgical business, what we have. Also, we are working on exploring a new vertical to launch under the TI Medical. Got it. Great. Thanks. Lastly, I had one request. For Shanthi Gears, the numbers have not been really great this quarter, but it is very difficult to get access to the management. It would be nice if you could have a representative from Shanthi also on the call, maybe from the next quarter. If you have any specific question, maybe we can take it. Yeah, we can do that also, Salil. We can get the Shanthi Gears on that. Okay. Thank you so much, Madam. Thank you. We have our next question from Vipul kumar Shah of Sumangal Investments. Please go ahead. Yes, sir. What was the capacity utilization for engineering division? Like we shared earlier, we maybe, let's say, plan capacity utilization almost two to three years ahead. As of now, we are running at 80%-85% capacity utilization. Our Nashik plant has just started in cold rolled strips, as well as the Phaltan plant also started doing commercial production just this month. We are covered at least for the next one to two years for having enough capacity to drive the growth. Thank you. Thank you. Our next question is from Rushabh Shah from RBSA Investment Managers. Please go ahead. No, sir. Could you come closer to the mic? Hello? Yes, sir. Yeah, just on the electric heavy commercial vehicle space, I understand that you mentioned about new product launches and battery swapping technology. Do we have what it takes to go all in now and capture the market, given that you're seeing increasing competitive intensity? Is pricing still a deal breaker? If you could just highlight some thoughts there. Yeah, thanks for the question. I think in terms of product performance, what we have demonstrated to the customer, our existing customer satisfaction, and the repeat orders which we are getting, we are very, very confident that we have enough to capture the market. As I told you, that despite so many number of players being there, our market share has been in 50% upwards. Yes, it's going to be a competitive market, but I think from a product standing point of view, our customer feedback and product performance point of view, we are very, very bullish and confident about H2. Okay. Just a clarification, you have seen certain companies doing retrofits to IC across the formats. Is this really a risk? Do you see success there or just initial success that they're seeing in terms of retrofits to IC across formats? We have carefully and we have purposefully chosen not to go this route because we are convinced that, grounds up, EV is any day a better bet as compared to a retrofit on any of the vehicles. That's our understanding and our take on this. Okay. On the medical devices, you mentioned that we're targeting 15% growth. I think earlier we were targeting 20%-25%. Is it that we are just being conservative here or has anything changed in the business? I mentioned about the existing, what we are doing, the sutures, but including what I told, we are going to add some vertical. Surely we are targeting 25%. Cover on the TI Medical. Okay. Just a big picture question. TI over a 5 - 10 year period has always delivered strong double-digit growth. That thesis is still intact, right? Yes, it is intact. Okay. Thank you. Thank you. We take our next question from Vijayaraghavan Swaminathan from Avendus Park. Please go ahead. Thank you. Thank you, team. [audio distortion], and my favorite question that I often come across in all your calls is that cash. Current investments have been about INR 150 crore on books currently, as we see it. That has been completely repaid. What is the plan with capital allocation? Any thoughts on that? Yeah. If we look into next year, so basically the breakdown is going to go, see, the core business, we're basically seeing revenue growing by about, in the range of like 10, I would say PBT definitely in the range of like 12%-15%. 12%-14%, 12%-15% is what we see. That's going to require a certain amount of capital for expansion. That's going to be kind of theme one. Theme two is going to be. Sorry? Would you be able to quantify CapEx requirement for the base business? Yeah. Yeah. Go ahead. Okay. What are you saying? For the base business? For base business, we are going to invest next year about INR 300 crore-INR 400 crore range for the standalone business. Yeah. That would be the base business. The second is what will go into growth on TI Medical and Triyom and businesses like that. That is going to be, that's again kind of, so basically if we look at it, right, if we say that TI standalone has to get, we target close to 14%, 12%-14% PBT growth from the standalone business, then we need to think of how else we can get up to 6% growth, right? That's what's going to be from other investments that we kind of look at from a CapEx perspective. When we look at the CapEx side, like I said, three chunks. Some money will go towards TI Medical, both in terms of greenfield, TI Medical and Triyom. I would say, again, that's in the range of about INR 400 crore. We will look at whether we need to invest in TI Clean Mobility. That is a decision we will make later in the year. We are looking at some M&A for new lines of business that are kind of in the same areas that we are, but can kind of potentially provide growth. I would say that up to INR 200-INR 300 crore can get allocated towards that. Okay. The last part is certainly got us excited. Just one other query with regards to this Triyom is that I remember in the initial clause that we had signed, the remaining of INR 25 crore of investment was supposed to be allocated if certain conditions were met. Further investments from Tube at that point of time. Now, has that been met? And then what were the internal targets that were decided for Triyom right now? We'll take an appropriate call based on the time as of now. No, I mean, I think the question is being up. Yeah. Okay. All right. Yeah. Sorry, you were saying? No, the INR 25 crore that has been invested into Triyom as per this quarter. I remember in the initial discussion, it was like certain targets had to be met before you make a further investment into Triyom. Have those been met is the question here. No. As we discussed, maybe we will take those calls at a later point of time. I'm asking, have the targets been met? See, actually, no. We have planned for INR 300 crore of investments in TI Medical initially. It's not TI Medical. It's Triyom. Triyom. In Triyom, INR 300 crores we are planning to invest, out of which INR 200 crores has been invested till the last year. This year, first quarter, we have invested INR 25 crores, and this quarter we have returned INR 25 crores. Remaining INR 50 crores will go this year. No, I think his question is not really answered. Let's just get a better understanding of this, right? And we'll get back to you with the answer to that. Right. Perfect. I think the same thing with medical. Is there a certain deadline that we should be looking in terms of the investment or? I'm just trying to understand. Medical, see, the basic thing is like sutures is one business, right? And we've always said that we look at other lines in medical. The investments will go into other lines in. It's not as much more in. Okay. One last one is that what has really given us this confidence? Because last quarter, we were not really this confident of investing into both these higher investment numbers. Now, what has really turned around in the last quarter that gives us confidence to pump in more money into both these ventures? See, basically, the way we look at it is that the fundamental thesis of these businesses kind of remains, right? Which is there is good long-term growth in both these businesses, right? Now, what we have to look at is, I think it's better to kind of look at how we kind of ensure that these businesses basically give us the growth and the profitability we need. If that requires more management attention, that's what we're now doing to ensure that we can get growth from each of these. That's what we will start doing now more. That 300 crores is going to be predominantly CapEx driven or is it going to be operational working capital driven? No. It depends, right? Like we said with TI Medical, if we're getting into a new line of business, that obviously requires more CapEx, right? It depends on how we kind of get in, right? If it's kind of a new line of business, if it requires anything that's inorganic, then that requires more capital. Otherwise, it'll be more operational. Perfect, Vellayan. Thank you. All the best. Thank you. Thanks so much. Thank you. Anyone who has a question may click on the raise hand icon. We now move to our next question, which is a follow-up from Vipulk umar Shah of Sumangal Investments. Please go ahead. Yeah, just a small clarification. You said 50% market share. For electric trucks. So that is Pan India or just South India? Pan India. Pan India. Thank you, sir. Thank you. Ladies and gentlemen, that brings us to the end of the Q&A session. On behalf of IIFL Capital Services Limited, that concludes today's conference. Thank you for joining us. You may now click on the leave icon to exit the meeting. Thank you all for your participation. Thank you. Thank you. Thank you.