In This Article:
Release Date: May 26, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
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Hi-Tech Pipes Ltd (NSE:HITECH) reported a significant revenue growth of 14% year-over-year, reaching INR 3,068 crores, marking their highest ever revenue.
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The company achieved a 24% increase in sales volume, setting a new benchmark with 485,447 tons.
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Net profit surged by 58% due to sharp cost control and high-margin products.
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The company's return on capital employed improved to 14.34%, reflecting better operational efficiency.
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Hi-Tech Pipes Ltd (NSE:HITECH) has been upgraded to an A+ credit rating, indicating strong governance and financial discipline.
Negative Points
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The company faced a slight shortfall in achieving its projected sales volume of 500,000 tons, closing at 485,000 tons due to order execution delays.
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There is increased competition in the market, with similar products being offered by other players, potentially impacting margins.
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The company is exposed to global market volatility, particularly concerning steel tariffs and trade agreements.
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Despite improvements, the net working capital days remain a focus area, with further reductions needed to enhance liquidity.
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The company has ongoing capital expenditures, which may impact cash flow and require careful financial management.
Q & A Highlights
Q: What is the volume and EBITDA per ton guidance for FY26, and what is the target for the value-added mix? A: For FY26, Hi-Tech Pipes is targeting a sales volume of over 600,000 tons, with EBITDA expected to range from INR 3,500 to INR 4,000 per ton. The value-added product share is projected to increase from 38% to around 42-43% by the end of FY26. (Respondent: Executive Director and Group CFO)
Q: How will the networking capital days trend with the increased volume push? A: Networking capital days have improved from 63 to 52 days, and further improvement is expected as the company continues to optimize operations. (Respondent: Executive Director and Group CFO)
Q: How is Hi-Tech Pipes addressing competitive intensity and margin pressures in the market? A: The company is confident in achieving a 25% annual sales volume increase through new products, geographical expansion, and enhanced marketing strategies. Despite competitive pressures, Hi-Tech Pipes is focusing on execution and expanding its export markets. (Respondent: Executive Director and Group CFO)
Q: What impact do steel tariffs have on Hi-Tech Pipes, and how is the company mitigating these effects? A: The Indian government has imposed a 12% safeguard duty on imported steel, providing insulation from global price shocks. This duty, combined with existing tariffs, creates a significant deterrent against imports, helping to stabilize the domestic market. (Respondent: Executive Director and Group CFO)