Summary
Welspun Specialty Solutions Limited - Q3 FY 2026 Earnings Call Summary Tuesday, January 27, 2026 4:00 PM
Event Participants
Executives 3 Anuj Burakia (CEO & Whole Time Director), Goutam Chakraborty (Head, Investor Relations, Welspun Corp), Navin Agarwal (CFO)
Analysts 3 Parth Bhavsar (Investec), Radha (B&K Securities), Sagar Shah (SH Financials)
Financials & KPIs
| Metric | Reported | Commentary |
|---|---|---|
| Total Income | ₹229 crores | +15% YoY; Growth driven by volume increases in both pipes and bars. |
| EBITDA | ₹19.8 crores | +52% YoY, +9% QoQ; Growth outpaced revenue due to improved operating leverage. |
| PAT | ₹9.5 crores | Significant improvement from ₹3.6 crore loss YoY; Includes ₹66 lakh onetime gratuity charge. |
| SS Seamless Pipe Volume | - | +50% YoY for Q3; 9M FY26 growth stands at +18% YoY. |
| SS Bar Volume | - | +22% YoY for Q3; 9M FY26 growth stands at +51% YoY. |
| Order Book | ₹200 crores | ~5,000 metric tons; Management noted stability despite a broader industry trend of declining order books. |
| Capacity Utilization (Steel) | ~50% | Increased from 20-25% over the last two years; Long-term target remains 80-85%. |
| Capacity Utilization (Pipe) | 60% - 65% | Significant headroom remains to meet future demand without additional capex. |
Geographic & Segment Commentary
- Domestic Market: Management has “sharpened focus” on India as export margins remain under pressure. The company noted that domestic bright bar consumption is rising, particularly from peering seamless capacity and strategic sectors.
- Export Markets (Europe & Middle East): Exports are currently hindered by geopolitical volatility and EU Tariff Rate Quotas (140k tons for bars, 20k tons for pipes). Management is actively seeking approvals from Middle Eastern oil and gas majors (e.g., Saudi Aramco) to supply projects directly or via global fabricators.
Company-Specific & Strategic Commentary
- Bright Bar Project: Commissioning is in “full swing” and expected to complete very soon. This project is a key debottlenecking initiative to utilize full steel plant capacity and meet high-value export requirement (Anuj Burakia).
- Product Portfolio & Accreditations: Successfully completed IBR accreditation for chrome alloy steel bars and tubes. The company added 30 new customers in 9M FY26, focusing on high-grade nickel alloys and extrusion-based products (Anuj Burakia).
- Value over Volume: Management reiterated a strategy to avoid low-barrier products like welded pipes or piercing-based tubes, focusing instead on high-investment, high-margin integrated extrusion (Anuj Burakia).
- Sustainability: Renewable electricity consumption increased to 53% in 9M FY26 from 31% in FY25, advancing the company’s ESG roadmap.
Guidance & Outlook
| Metric | Guidance / Outlook | Commentary |
|---|---|---|
| Volume Growth | >25-30% for FY26 | Management expects to exceed previous guidance of 25-30% growth for the full year. |
| Capacity Target | 80-85% within 2 years | Goal is to reach this utilization level for both steel and pipe facilities based on current assets. |
| Export Recovery | Indeterminate timeframe | Management is watching “week by week” for stabilization in global geopolitics before guiding on next year’s exports. |
Risks & Constraints
| Risk | Context |
|---|---|
| Export Volatility | Geopolitical tensions and EU quotas (25% duty beyond limits) are keeping margins under pressure and delaying project awards. |
| Regulatory Easing | Temporary lifting of BIS restrictions on non-compliant SS products until March 2026 has allowed cheaper imports to enter India. |
| Piercing Mill Competition | Lower-cost piercing capacities in India are capturing the “standard product” market, though Welspun mitigates this by focusing on premium extrusion applications. |
Q&A Highlights
Market Demand & Order Book
- Question: Why has the order book been on a declining trend? (Parth Bhavsar)
- Answer: Projects are being “postponed, not cancelled” due to global uncertainty. This is creating pent-up demand that historically returns with intensity (Anuj Burakia).
Strategic Focus
- Question: Why not invest in piercing or welded pipe capacity to increase volume? (Parth Bhavsar)
- Answer: Piercing and welded markets have low entry barriers and are “killing themselves” on margins. Welspun chooses to stay in the high-barrier, integrated extrusion space to chase value over volume (Anuj Burakia).
Export Markets
- Question: Are you expecting orders from Saudi Aramco? (Radha)
- Answer: The company is in advanced stages of gathering important approvals from Middle Eastern oil and gas establishments. Business will follow once accreditations are secured (Anuj Burakia).
Import Challenges
- Question: How has the temporary easing of BIS restrictions affected sales? (Radha)
- Answer: While imports have risen, the industry is working with the government to reinstate restrictions after March. Impacts on Welspun have been manageable so far (Anuj Burakia).
Key Takeaway
Welspun Specialty Solutions delivered a resilient Q3 FY26, characterized by a 52% YoY increase in EBITDA to ₹19.8 crores and a return to profitability with a PAT of ₹9.5 crores. Despite global macroeconomic volatility and margin pressure in exports, the company achieved volume growth of 50% in SS seamless pipes and 22% in SS bars. Strategically, the firm is transitioning toward higher-value products, evidenced by the upcoming commissioning of the Bright Bar project and the successful IBR accreditation for chrome alloy products. While the order book of ₹200 crores reflects broader industry caution, management remains confident in exceeding 25-30% annual growth for FY26. Moving forward, the company’s focus is on increasing capacity utilization toward 80% and securing premium global project approvals, positioning it to capitalize on domestic infrastructure growth and a future rebound in international markets.
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