Venus Pipes and Tubes Limited Q1FY25 Earnings Call Summary
Notification and Access
• Transcript and audio of the Q1FY25 Earnings Call available on the company's website.
• Call held on July 25, 2024, following Q1 financial results announcement.
Key Management Participants
• Managing Director: Arun Kothari
• Whole-Time Director: Dhruv Patel
• Chief Financial Officer: Kunal Bubna
• Moderator: Dhruv Jain (Ambit Capital)
Economic Overview
• Global growth projected at 3.2% (2024) and 3.3% (2025).
• India expected to grow at 7%.
• Challenges noted in the US manufacturing sector, but opportunities for Indian companies highlighted.
Financial Performance Highlights
• Revenues: INR 240 crores (up 34% YoY)
• EBITDA: INR 48 crores (up 74%)
• PAT: INR 28 crores (up 58%)
• Export revenues: INR 61 crores (25% of total revenue), driven by oil, gas, and pharma sectors.
Export Strategy and Performance
• Exports prioritized over domestic sales.
• Seamless utilization over 90%, welded utilization around 60-65%.
• Blended EBITDA per kg improved by over 2% YoY, exceeding INR 65 per kg.
Future Growth and Sustainability
• Focus on expanding in Europe, the U.S., and the Middle East for sustainable growth.
• Expected export growth to exceed 25% for the year.
• Anticipated blended EBITDA improvement of 3-5%.
Market Insights
• Demand increasing across sectors, including chemicals and oil and gas.
• 65% of exports directed to Europe, 20-25% to the U.S.
• Shift towards welded products expected, particularly in the oil and gas sector.
Capital Expenditure Plans
• INR 180 crore capex planned for FY'25 and FY'26.
• Majority of capex allocated for FY'24-25.
Margin Improvement Factors
• Increased production capacity and backward integration.
• Shift towards higher-margin products.
• Pricing strategies to manage rising freight costs.
Competitive Landscape
• Pricing competitiveness in the Middle East compared to Chinese manufacturers acknowledged.
• Emphasis on quality and approvals in the oil and gas sector.
Conclusion
• Call concluded with an invitation for further inquiries from participants.

Earnings Call Announcement
• Date: May 15, 2024
• Transcript available from May 9, 2024 earnings call
• Featured management: Arun Kothari (MD), Dhruv Patel (Whole-Time Director), Kunal Bubna (CFO)
• Hosted by Ambit Capital
Financial Performance Highlights
• Revenue Growth: Over 45% year-on-year, reaching Rs. 802 crore for FY24
• PAT Increase: 94.3% growth
• Key Growth Factors:
• Rise in high-margin seamless pipe contributions
• Increased export revenues (Rs. 29.8 crore in FY23 to Rs. 98.7 crore in FY24)
• Production Capacity: Expanded and invested in advanced testing technologies
Future Plans and Investments
• CAPEX: Planned Rs. 175 crore for manufacturing expansion, including titanium welded tubes
• Sustainability: Operationalized additional seamless pipe capacity and a solar power plant
• Market Expansion: Targeting new markets in the US, Middle East, and Africa, while strengthening presence in Europe
Financial Results Overview
• Q4 FY24 Revenue: Rs. 224.1 crore, a 27.1% increase year-on-year
• Seamless Segment Growth: 87% increase in revenue; welded segment grew by 24%
• Exports: Surged by 231% year-on-year
• Profitability: Gross profit for Q4 FY24 rose by 116.5%, EBITDA increased by 109%
Demand and Market Insights
• Projected Growth: 30% growth anticipated, driven by engineering and oil & gas sectors
• Export Contribution: Expected to be at least 20% of total revenue
• Opportunities: High antidumping duties on Chinese imports may benefit Indian manufacturers
Order Book and Capacity Utilization
• Current Order Book: Valued at Rs. 240 crores with a 100-day execution cycle
• Capacity Utilization Targets: 85-95% for seamless pipes, around 80% for welded pipes
• Volume Mix: Projected 40-43% seamless and remainder welded
Sector Focus and Future Outlook
• Hydrogen Sector: Significant focus on stainless steel pipes for hydrogen transport
• CAGR Projection: 30% growth over the next two years despite potential economic slowdowns
• Operating Cost Reduction: Solar power plant expected to reduce costs by 8-10%
Conclusion
• Management expressed confidence in meeting demand despite competition and highlighted plans for regular updates to stakeholders.

Call Overview
• Date: March 7, 2024
• Focus: Transcript of Business Update Call held on February 29, 2024
• Key Participants:
• Arun Kothari (Managing Director)
• Dhruv Patel (Whole-Time Director)
• Kunal Bubna (CFO)
Capital Expenditure Plans
• Previous Capex: INR 165 crores successfully executed, enhancing capacity and margins.
• New Capex: INR 175 crores for value-added product lines.
• Phase 1: INR 115 crores for fittings and welded tubes, operations by March 2025.
• Phase 2: INR 60 crores for expanding capacity, operations by December 2025.
Product Development
• Focus on introducing titanium welded tubes and enhancing fittings business.
• Targeting demanding industries to strengthen market position.
• Initial capacity for titanium tubes: 3,600 metric tons by March 2025.
Financial Strategy
• Funding:
• 40% from warrant issuance (primarily for promoters).
• 60% from bank loans and internal accruals.
• Profitability: Projected overall margins to exceed mid-teens.
Market Insights
• Demand for titanium tubes primarily from government sectors (power and nuclear).
• Limited competition in the fittings market, with 40% of pipe requirements for fittings.
• Plans to capture market share by increasing capacity for titanium and hygienic tubes.
Growth Projections
• Expected 30% growth in top line over the next three years.
• Anticipated CAGR for new business from FY'26 to FY'31 similar to current business growth (30% to 40%).
Conclusion
• Management expressed optimism about growth potential and profitability of new product lines.
• Encouragement for further inquiries through investor relations.

Venus Pipes and Tubes Limited Earnings Call Summary
Date and Announcement
• Date of Call: January 30, 2024
• Financial Results: Q3 and nine months ending December 31, 2023
• Key Management Present:
• Arun Kothari (Managing Director)
• Dhruv Patel (Whole-Time Director)
• Kunal Bubna (CFO)
Financial Highlights
• Q3 FY24 Revenue: INR 207.1 crores (52.2% YoY increase)
• PAT Growth: 106% to INR 23.3 crores
• Revenue Drivers:
• High-margin seamless pipes (56% of total revenue)
• Increased export contributions
• Nine-Month Revenue: INR 578.1 crores (54% YoY increase)
Operational Insights
• Capacity Expansion: Significant growth in stainless steel pipe capacity
• Market Expansion: Focus on Europe, US, Africa, and the Middle East
• Technology Integration: Enhancing operational efficiency and sustainability
Margin and Export Strategy
• Margin Sustainability: Potential for improvement, especially in seamless segment
• Export Goals: Aim for exports to represent at least 20% of total revenue
• Current Order Book: INR 230 crores (20% from exports)
Future Growth Plans
• Capex Plans: INR 40-50 crores annually for growth
• Client Acquisition: Targeting sectors like pharmaceuticals and chemicals
• Utilization Rates: Expected to reach 80-85% in the next financial year
Cash Flow and Debt Management
• Cash Generation: Anticipated strong cash flow in FY25 and FY26
• Debt Status: INR 155 crores, with a focus on growth and working capital
Competitive Landscape
• Market Competition: Addressing competition from Ratnamani and Jindal
• Differentiation Strategy: Expanding product offerings and capabilities
Strategic Focus
• Export Optimization: Targeting high-margin products and backward integration
• Regulatory Environment: Favorable anti-dumping duties in the U.S. for Indian products
• Growth Projections: 45-50% YoY increase for FY'24, 30-40% for FY'25
Conclusion
• Management Commitment: Ongoing updates to investors and gratitude expressed to participants.

Earnings Call Notification
• Date: November 1, 2023
• Transcript available on company website
• Hosted by Antique Stock Broking with senior management participation
Financial Performance Highlights
• Record quarterly revenue: Rs. 191.4 Crores (51% YoY increase)
• Seamless pipe sales growth: 153%
• Export sales contribution: 15% of total revenue
• Significant growth in gross profit and EBITDA
Capacity Expansion and Demand
• Increased capacity from 12,000 MTA to 33,600 MTA
• Backward integration for seamless pipes positively impacting margins
• Order book: Rs. 210 Crores (25% from exports)
Market Dynamics
• Strong demand for seamless pipes due to exports and favorable market conditions
• Utilization level for hot piercing increased from 75% to 80%
• Anticipated growth in welded pipe sales
Financial Management
• Increased debt from Rs. 90 Crores to Rs. 145 Crores for working capital
• Stable working capital days (90-105 days)
• Expected cash flow improvement in H2 FY2024
Future Growth Projections
• Anticipated CAGR of 35% for FY2024 and FY2025
• 15-20% growth expected annually thereafter
• Plans to enhance production efficiency and client base
Margin Improvement Strategies
• Backward integration contributing to margin expansion
• Higher margins for export sales (3-5% more than domestic)
• Targeted EBITDA margin improvements: 40-50% for seamless pipes, 15-20% for welded products
Conclusion
• Optimism about future growth, particularly in high-margin sectors
• Upcoming facility visit for stakeholders announced

Company Performance
• Date of Call: August 4, 2023
• Key Management: Managing Director Arun Kothari
• Financial Highlights:
• 58.1% year-on-year revenue increase
• 91.7% rise in EBITDA
• Significant growth in seamless pipe sales (150%)
Market Outlook
• Industry Trends:
• Positive demand outlook in the stainless-steel industry
• Government initiatives supporting organized players
• European Market:
• Challenges: geopolitical tensions, high inflation, rising energy prices
• Opportunities for organized manufacturers like Venus
Strategic Initiatives
• Production Capacity:
• Expansion plans to increase seamless capacity by 50%
• Current utilization at 62%-65%, aiming for 70% by FY25
• Product Development:
• Introduction of new products like LSAW pipes
• Focus on sectors such as pharmaceuticals and railways
Financial Projections
• Revenue Potential:
• Anticipated growth of 2x to 2.5x compared to FY23 from new capacities
• Order Book: Approximately ₹200 crore, executable within 90-100 days
Competitive Positioning
• Market Acceptance:
• 90% acceptance of piercing technology for hollow pipes
• Debt and Working Capital:
• Net working capital cycle of 100-105 days
• Total gross debt of ₹120 crores
Conclusion
• Future Growth:
• Confidence in achieving FY25 revenue targets despite industry challenges
• Exploring opportunities in US and African markets
• Management Communication: Encouragement for ongoing investor engagement

Earnings Call Notification
• Date: May 31, 2023
• Transcript available on company website
• Key participants:
• Arun Kothari (Managing Director & CFO)
• Dhruv Patel (Whole Time Director)
• Kunal Bubna (President of Finance & Accounts)
• Moderated by Pallav Agarwal (Antique Stock Broking)
Financial Highlights
• Successful first year post-listing
• Commercial production of seamless pipes commenced
• Q4 FY23 revenue growth: 60%
• Full year revenue growth: 43%
• 74% volume rise in high-margin seamless pipes
• Positive operating cash flow for FY23
• 100% revenue increase from Maharashtra
• Shift towards direct domestic sales
Capacity Expansion and Production
• Total seamless pipe capacity post-expansion: 9,600 MTA
• Current operational capacity: 7,200 MTA
• Welded pipe capacity target: 15,600 MTA
• Incremental capacity ramp-up planned for FY24
Market and Product Strategy
• Expansion into larger diameter pipes (up to 48 inches)
• Job work strategy for seamless pipe production
• Expected margin improvements from new capacities
• Strong demand across sectors: chemicals, engineering, pharmaceuticals, oil and gas
Future Projections
• Capacity utilization targets for FY24:
• Seamless pipes: 65-70%
• Welded pipes: 60%
• Anticipated margin increase of 300 basis points in FY24
• Order book valued at ₹180-185 crores for next three months
Industry Insights
• Total market size estimated at 300,000 tonnes
• Competitive landscape with significant unorganized sector
• EBITDA per tonne: ₹63 for seamless, ₹37 for welded
• Potential for seamless EBITDA to exceed 40% in the future
Conclusion
• Regular updates promised to investors
• Call concluded with thanks from Arun Kothari