Welspun Corp Ltd (WELCORP) Q2FY27 Concall Transcript - Sep-2026 Qtr
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Moderator: Ladies and gentlemen, good day and welcome to the Welspun Corp Q2 and H1 FY '27 earnings conference call. 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 your conference call, please signal an operator by pressing star then zero on your touch-tone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Shailesh Raja from 360 ONE Capital Market Private Limited. Thank you and over to you, sir.
Shailesh Raja (360 ONE Capital Market Private Limited): Yeah, thank you, Steve, and welcome everyone. We thank the Welspun Corp team for giving 360 ONE Capital the opportunity to to host this interaction today. I would now like to invite Mr. Goutam, Head of Investor Relation at Welspun Corp, to introduce the management team. Over to you, Goutam.
Goutam (Welspun Corp Ltd): Thank you, Shailesh, and good afternoon to everyone. Welcome to our Q2 and H1 FY '27 earnings call. On this forum today, we have Mr. Vipul Mathur, Managing Director and CEO, Mr. Percy Birdy, Chief Financial Officer, Mr. Yashovardhan Agarwal, Director Sintex, and Mr. Harsh Rungta, Head, Group Investor Relations. Before starting the call, you all must have gone through the results and the investor presentation of the company, which are also available on the stock exchanges and on our website as well. And during the discussion, we may be making some references to this presentation. So, I request you to please refer to the safe harbor statement, which is there in our presentation. Before the opening remarks, let me just inform you that Mr. Mathur is a little under weather and he's not having a good throat. So, the we'll start the forum with the opening remarks by Mr. Birdy and post that we'll open the floor for the Q&A. With that, let me hand over the floor to Mr. Birdy. Over to you, sir.
Percy Birdy (Welspun Corp Ltd): Thank you, Goutam. Good afternoon, everyone. Let me first welcome you all on this forum to discuss our Q2 and H1 FY '27 performance. As Goutam mentioned you I'm sure you all had a chance to go through our results and the detailed investor deck that we published on the exchanges and also on our website. Therefore, I would like to highlight only some some of the key aspects in my opening remarks, and after that we can have more time for an interactive session. We delivered yet another robust quarter. Our Q2 FY '27 EBITDA stood at a record all-time high of ₹782 crore, registering 25% year-on-year growth. Our half-yearly EBITDA rose 30% YoY to ₹1,538 crore, again an all-time high. This compares favorably with our annual guidance of ₹2,850 crore EBITDA. Our annualized ROCE, return on capital employed, for H1 FY '27 stood at 22.7%, well above our guidance of more than 20% for FY '27. Our net debt cash position also improved further to a net cash of ₹3,887 crore. This is after having incurred CapEx of approximately ₹1,500 crore for H1 of FY '27. As you know
Percy Birdy (Welspun Corp Ltd): Our order book stands at an all-time record high of approximately ₹50,000 crores, roughly $5.2 billion. This provides strong growth visibility and underscores our exceeding footprint in the global pipe line market. Before touching upon the business environment, I am pleased to inform you that the board has approved three key investment projects: Debottlenecking and capacity augmentation of our spiral pipe capacity in the US by 225,000 metric tons per annum at a CapEx of up to US$115 million. This is expected to be ready by March 2028. Setting up of a greenfield spiral pipe plant along with a coating facility in Jordan under a 50-50 JV with Parma Pipe at a total project CapEx of up to US$125 million to be shared with the partner. We are going ahead with this investment on the basis of firm MoU with the developers of Jordan's National Water Carrier Project and the government of the Hashemite Kingdom of Jordan to advance the development of pipe manufacturing and advanced coating facilities in Jordan. The proposed facilities will be capable of serving major water, oil and gas, energy and infrastructure projects in the kingdom and also across surrounding regional markets due to Jordan's strategic location. We are also setting up a joint venture in India for internal FBE, fusion-bonded epoxy, coating capability in an equal partnership with Perma-Pipe. This will give us the complete bouquet of pipe coating services, which will enable us to go after large pipe export orders where IFBE coating is mandatory. Now, let me discuss the business environment. As far as US market is concerned, demand continues to remain robust. The medium- to long-term outlook continues to be supported by growth in LNG exports, rising electricity requirements from AI data centers triggering the demand for new gas pipelines for captive gas turbine power plants and investment across onshore and offshore oil pipeline infrastructure. We are currently booked through FY29 in the US. KSA market, ongoing investments in oil and gas and water infrastructure are expected to support pipeline demand. The region's evolving energy security and infrastructure priorities may also create opportunities, also the potential for reconstruction in the Middle East region once the geopolitical situation stabilizes. In the short term, the supply chain logistics and freight costs in the region have been adversely impacted. Coming to India, the domestic demand continues to remain muted. The domestic water market remains under stress, though there have been some optimism around river interlinking projects and interstate water sharing agreements. However, the central government budgetary constraints need to get lifted for orders to get awarded. On the domestic oil and gas segment, we see a lot of potential going ahead in Samudra Manthan, deepwater exploration, in PNG connections and refinery projects. However, we are yet to see the orders inflow. Exports from India, of course, continues to be the bright spot and we continue to focus there, where we see good demand coming from the Middle East, Southeast Asia and LatAm. In this context, let me reiterate that our diversified global presence, spread across USA, Saudi, India, and in future, Jordan as well. This helps us in mitigating challenges in a particular geography. Moving ahead to Welspun Specialty Solutions Limited, WSSL, while higher freight costs and the tariff regulations impacted exports to Europe adversely in this quarter, WSSL continues to focus on domestic power gen, thermal, nuclear, defense, aerospace, oil and gas and petrochemical sectors, which are the high value-added segments, for stainless steel bars and seamless pipes. Coming to Sintex, we continue to focus on channel expansion. In water storage tanks, we focus on premiumization alongside sustained momentum economy segment, growth led by urbanization in the Tier 2 cities. In plastic pipes, we have extended footprint to 15 states and continue to focus on product portfolio expansion.
Percy Birdy (Welspun Corp Ltd): and brand visibility. We remain focused on our core products and geographies, prudent capital allocations, maintaining strong supplier customer relationships, innovation and building capabilities across our organization. Our people remain integral to our growth strategy while our sustainability agenda continues to guide responsible manufacturing and long term value creation. With that, let me ask the moderator to open the floor for the question and answer session.
Moderator: Thank you, sir. We will now begin with the question and answer session. Anyone who wishes to ask a question may press star and one on their touch tone telephone. If you wish to withdraw yourself from the question queue, you may press star and two. Participants are requested to use handset while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question comes from the line of Shaurya Shah with Equirus Securities. Please go ahead.
Shaurya Shah (Equirus Securities): Yeah. Thank you for taking my question. So, the first thing that I want to ask about is on the US business. So, of course, the oil and gas front, a large part of order booking has been
Moderator: Mr. Shaurya Shah, your line has been unmuted. Please go ahead with the question.
Shaurya Shah (Equirus Securities): Yeah. Hello. Am I audible? Hello?
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