Hello, hi. Good evening everyone, and welcome to APL Apollo's quarter 3 FY26 earnings call.

I would like to take this opportunity to congratulate Team Apollo for such a stupendous performance in a quarter which had multiple headwinds, such as subdued macro, construction ban in Delhi NCR, and falling raw material prices. If you look at our performance, I would like to highlight a few points, number one being that the nine-month sales volume increased 11% year-on-year, which is well in our guidance range of 10 to 15% growth, which we had communicated in the quarter one FY26 earnings call.

Nine-month EBITDA per ton is above 5,000 rupees, which has surpassed our own guidance, which we had given in quarter one earnings call. Our strategy of pricing premiumization by leveraging APL Apollo brand has worked excellently to expand our EBITDA spreads, and the launch of SG brand in the base category worked well to compete with the smaller players in the structural steel tube segment and the sponge iron pipe players.

It's been 12 months since we increased the selling price for APL Apollo branded products, which does suggest that the markets have successfully accepted our brand equity, and the premium of 3 to 4,000 rupees per ton for APL Apollo brand is a new normal for the structural steel tube segment. Another highlight for the quarter three result is that we sold 375,000 tons of volume in December month, which implies the annual figure of 4.4 million tons.

We have successfully tested our 5 million ton capacity, as almost 90% utilization we could achieve in the December month of 2025. We are very confident of this momentum to continue, hence we are upgrading our sales volume growth guidance 20% for quarter four FY26 and FY27, with EBITDA guidance of almost 5,500 rupees per ton.

At the same time, we are aggressively pursuing capacity expansion to 8 million ton from current 5 million tons in next two years, which is a mix of four greenfield projects, two being in East India, one in South India, and one in West India, one being the brownfield project in Raipur for value-added products, and very interestingly, we identified one million ton expansion through debottlenecking, wherein we identified existing mills which could be replaced with much faster modernized mills, which will expand our ROCEs to next levels, because the investment over there will be very, very minimal. Total investment to expand our capacity from 5 to 8 million ton is around 1,500 crores, and this will be funded from internal cash flows over the next two years.

Now one thing which obviously we will be talking much more over our earnings call is the additional 2 million ton to achieve our vision of 10 million ton capacity by 2030. This incremental 2 million ton will be in the super speciality segment, wherein we are identifying various targets worldwide for the JVs with Japanese, Korean, and European and American companies to offer products in specialized segments like EV, category aerospace, petrochem, oil and gas, heavy engineering.

We are already talking to a few targets. Over the next 12 months, there will be much more coming from our side.

So 8 million ton of structural steel tube capacity by FY28 and overall 10 million ton steel tube capacity by 2030. This is what vision every member in APL Apollo team is working on.

We are also working on a lot of cost control measures, which Sanjayji will elaborate later in the call, so that we are able to achieve 5,500 ton of EBITDA target on per ton basis, because it's a big jump in our guidance, which we gave from 4,800 to 5,000 to 5,500 rupees per ton. A lot of working has gone while we are throwing up this number to our investors.

On cash flow generation, you could see that our balance sheet has surplus cash of 5.6 billion rupees. Now most of the capex is behind us, right, and the company is throwing such large cash flows.

Plus the sales run rate what we are achieving, we are seeing a lot of opportunities to rationalize the inventory days, which right now is 30 plus. It will be in 20 days range, and with a strong Q4, our surplus cash on balance sheet could be 1,500 crore rupees, which was always our target that we will have as much cash on our books to match our current liabilities, so that we can be a liability-free company.

Debt-free company we became two years ago. Now we are on the verge of becoming liability-free company.

With such high inventory churn and better EBITDA spreads and volume growth, our ROCE, which right now stands at 33%, it would also further expand to 40 levels. Things look very, very promising.

Thank you everyone for joining the call. We are happy to take questions now.

Hi, good evening team, and many congratulations and great set of numbers. Just a couple of questions from my end.

Did we hear it correctly that you said 20% volume growth in Q4 as well as FY27, and more concern of FY27 while quarter four is understood? Secondly, what's changed in the last, I would say, three to four months or six months, where your EBITDA per ton guidance has suddenly moved up significantly, like you said, from 4,800 to 5,000 to now 5,500?

What are the measures you are taking or what are the developments which are happening in the product mix, which is leading to this kind of increase in guidance?

Thank you, Sneha. Our mainly volume growth is coming from our strategy.

We have decided to go with the other brand also. Right now you can say we are actual in our segment in the market, and also we are available in our market.

Usko volume

karne mein kuch pressure nahi aa raha hai. To humko do-teen mahine hum trial le rahe the.

This trial is totally successful. We started in the month of November, November, December, and till now in January also we are going very good with our targets.

I think हमारा strategy पूरा काम कर गया है, और strategy पर के हिसाब से हमको volume growth लेने में दिक्कत नहीं आ रहा है. Rightly you can say कि हम इस साल 3.55 million ton के आसपास करेंगे, जो हम Q4 में भी targeting 10 to 11 lakh ton के बीच में हम target कर रहे हैं.

You can say 10.25 or 10.5, we can easily achieve. तो इससे हमको जो fixed cost था, वो काफ़ी कम हो गया है, क्योंकि fixed cost हमारा था 2.6 lakh ton per month बना रहे थे, या हम 3.7 बनाया.

मतलब cost वही का वही है. तो उसने हमको 300-400 हमारे fixed cost का leverage कम कर दिया, plus Apollo पे जिस हिसाब से pricing पर के हमने marketing किया, तो उससे हमको काफ़ी leverage मिल गया कि Apollo as a brand well stabilized हो गया.

Margin तो हमारा और भी ज़्यादा हो जाता, but due to premium हमारा margin कम होने के कारण, क्योंकि premium में हमारा margin जो 1500 से 2000 per ton के बीच में आ रहा है. उसके कारण हमारा spread थोड़ा-सा कम हो गया overall में.

Otherwise नहीं, Apollo में we are well in head. और धीरे-धीरे, जैसे- जैसे हमारा volume 5 million ton पर एकदम setup हो जाएगा, तो मैं premium को खत्म तो नहीं करूँगा, but slowly-slowly उसको slow कर देंगे और Apollo को और बढ़ाते जाएंगे.

As a brand, उसको abnormal growth लेना थोड़ा-सा मुश्किल होता है, but जो नीचे वाला brand है, उसमें तो जितना... मैंने पहले भी बोलता था कि growth ले सकते हैं, but अभी तक chicken curry वाली story चल रही थी.

हमको डर लगता था कि हम volume बढ़े नहीं और हमारा cost कम नहीं हो और हम माल सस्ता बेचा तो हमारा margin बहुत ज़्यादा खराब हो जाएगा, इसलिए हम डर रहे थे. But जो हमने last October के बाद से step उठाया, October में we are doing so-so.

Like we have done in October 2.5 lakh ton. November we have done almost 3 plus, 3 lakh ton, and December we have done 370.

January also we are looking for 370 or 380. तो मेरे इसके कारण उसमें मैं जो costing से फर्क पड़ा है, तो कुछ अपने value addition जो हमारे sales जब pick हुए तो value-added product भी हमारा ज़्यादा बिकना शुरू हुआ है.

कुछ हमारा जो sales pick हुए तो local plant का local में ही माल बिक रहा है, उससे हमारा we have reduced our freight cost also by 100-200 rupees per ton. पहले sales कम था तो इधर से plant को शिप करने के लिए उधर माल जा रहा था, उधर जा रहा था.

अब हर plant अपने local market को focus कर रहा है, तो इससे हमारा कुछ freight cost पर भी फर्क पड़ा है, कुछ power cost पर भी हमारा फर्क पड़ा है. Like अगर हम बात करें कि हमारा पहले 90 units के आसपास बिजली cost, 90 कितना units?

92 units आ रहा था October तक. वो हमारा December में 80...

नहीं, mind आया है quarter का. December का कितना है?

84. December में वो 84 units आ गया.

तो इससे छोटे-छोटे plus cost में 200-300 per ton का फर्क पड़ गया. तो इससे करके हमारा margin increase हुआ है.

Thank you. Thanks.

Thanks a lot, sir. Thank you so much and all the very best team.

Thank you. Thank you, sir.

Just to reiterate that we are saying 20% volume growth for Q4 FY26 and for the full year FY27 over FY26. Thank you.

The next question is from the line of Bharat C. Shah from Bharat C.

Shah. Please go ahead.

नमस्ते संजय जी. Thank you Bharat bhai.

नमस्ते. नमस्ते.

पहले तो एक मुझे point राजीव करना था before I ask a question. अनुभव वो बार-बार बताता है headwinds and challenging, quarterly presentation में भी वो लिखे, headwinds and challenging, वगैरह.

My मानता हूँ कि संजय गुप्ता जी जैसे entrepreneur का जन्म ही challenges, और उसको overcome करने के लिए होता है. I think we should stop writing these three.

मैंने भी आज तक देखा नहीं कभी, मैं भी देख के बंद करूँ. You are absolutely right.

First of all, आप इतना बड़ा regard देने के लिए very thankful to you. मैं भी Bharat bhai मानता हूँ कि life में या तो success है या failure है.

मैंने ये सब बहाना है headwind, tailwind, ये तो आप लोगों का बहाना है. I just wanted to, that is the first point.

आगे सबको life में नहीं जाएगा, headwind, tailwind, pass or fail. Okay.

Basically, I think fundamentally the most important thing in strategic focus that we have now steered, in which I think is providing superior outcomes, is to focus on overall growth of the profit pool, whether it comes through volumes, it comes from the lever due to volumes, or whether it comes to the mix. I think we use those as levers, but objective clearly is to grow the profit pool.

I think that strategy of focusing on the profit pool perhaps is the most important strategic change that we have initiated in last few quarters, and in my personal opinion, and absolutely the right area to focus on. I want to get your perspective on the matter.

Bharat bhai, ऐसा है मैं आपको बताता हूँ, मेरे को तो देखो simple way में समझ में आती चीज़ है. इसमें हमने अपने business को चार-पाँच parts में divide कर दिया है.

एक तो Apollo brand, इसमें हम लगभग 2 lakh 40 thousand ton per month बेच रहे हैं. उसके बाद हमारा Dubai plant almost 25 thousand के position पर पहुँच गया है.

उसका तीसरा product है हमारा cap folding, जो एकदम पत्रे को heat करके, Raipur को heat करके माल बेचते हैं. और SG premium हमारा लगभग 50 thousand ton होता है, और इन products में हम लगभग 40 thousand का काम करते हैं.

तो इस तरह से करके हमने 3 lakh 70 thousand का bracket बनाया है. Apollo में we are targeting Apollo brand 6,000 rupees per ton.

Dubai में हम 7,000 easily आराम से पहुँच जाएंगे, Q4 से, no problem at all. Roofing में भी हमको 7,000 के आसपास का EBITDA आ जाएगा.

स्कैप में और ये SG premium में हमारा EBITDA 1,500 से 2,000 per ton रहता है. तो अगर इसको total average calculate करेंगे तो is close to 6,000 rupees per ton in 3 lakh 70,000 ton.

3 lakh 70,000 ton into 6,000 rupees, 220 crore rupees लगभग per month हो गया. तो we have अब हमने ये decide कर लिया कि अगर हम 20-30-40,000 से failure या pass होते थे, 20-30,000 ton माल जिस rate बिकेगा बेच के जाएंगे.

अगर हम 20-30,000 ton माल 4 rupees सस्ता भी बेच दिया तो 10 crore का नुकसान होता है हमको. 5 rupees सस्ता बेच दिया तो 15 crore का नुकसान होता है.

तो 200 crore को निकालेंगे ही निकालेंगे. तो हम इस type की strategy पे आ गए.

पहले हम इस type की strategy से डर रहे थे. अब हम इस type की strategy से काम कर रहे हैं.

दूसरा थोड़ा-सा हमको drawback अभी तक चला था. पहले जिस तरह से raw material में Raipur में benefit होता था, अब Raipur से freight cost increase होने के कारण Raipur में raw material का benefit का factor खत्म हो गया है.

अब Raipur का area जो एक regional area रह गया या all India value-added product का area रह गया. तो हमने कुछ strategy करके अपने plants को उस दिन से पिछले तीन महीने में strategize किया है कि Raipur से अपना सारा value-added product ले जाएँ.

बाकी plants को हमने local पर focus कराया. तो अभी हमारे साथ freight cost था Rapur से 25-2600 rupees, Patan आ रहा था average, और ये local plant से 1150 आ रहा था.

तो 1150 को हम target कर रहे हैं कि 750 पर ले आएं और 25-2600 को हम कम नहीं कर पाएंगे. तो वहाँ पर हम value addition से freight को make up करना चाहते हैं.

क्योंकि local orange के rate बहुत बढ़ गए हैं. तो Rapur में हमको थोड़ा सा, और हमारी main capacity Rapur में थी, तो थोड़ा सा हमें problem face कर रहे थे.

तो उसमें हमने strategically काम किया, तो उससे हमको benefit एक और मिला है. जो अनुभव बोल रहा है कि हमारा free cash flow इस साल बहुत जबरदस्त हो जाएगा.

जब हमने plants को local, पहले हम हर type के product हर type के plants में बना रहे थे. अब हमने हर plant को standardized कर दिया कि इस plant पे यही चीज बनेगा.

सारा mixture जो हम Rapur उठा के ले गए, तो उससे हमारा inventory बहुत कम हो गई है. उससे हमारा free cash बहुत generate होगा.

तो ये सब जो वो चार काम किए हैं, I think हम बहुत hopeful हैं कि हमको pressure नहीं आना चाहिए, until unless कोई environment में बहुत बड़ा कुछ change नहीं आ जाए. We are in a very comfort position.

Absolutely. वही मैं संजय जी दोहरा रहा था कि basically volume कितना है, mix क्या है, कभी कोई tactical strategy है या cost के ऊपर तो हम ऐसे भी जबरदस्त focus और control है ही है, and operating leverage, ये सभी हमारे हाथ में tools हैं.

Overall that should culminate into profits, and focusing on profits and growing the profit pool is far more strategically simpler objective, and in my opinion an efficient objective rather than, getting carried away by moving parts कि कभी volume पे कर दिया और हमने जोड़ों से माल दबा दिया. उसके बजाए जो strategy अभी अपनाई है, हमने तीन-चार quarters से, of course in between we suffered from a particularly bad quarter where steel prices swung.

Nobody can do anything. That is something exempted.

सर, हमने पहला guideline तो 1700 करोड़ का दिया था इस साल का. अब 1800 करोड़ में तो वो doubt ही नहीं रह गया मेरे को.

We are targeting कि 1900 करोड़ को cross करें. बिल्कुल, बिल्कुल.

Then second question I wanted to, when I am looking at conversion of EBITDA into operational cash flow in this particular period of nine months, it has suffered. Clearly that has suffered because some amount of working capital has come into play.

Our free cash has gone up because capex is now behind us. The question that I wanted to raise was, Anubhav mentioned at the beginning somewhere zero debt company, zero debt balance sheet to liability-free balance sheet.

If I have to interpret that appropriately, it will mean that basically even current liabilities probably were in knock-off, which means our managing of inventory and accounts receivable is so efficient that the reduction of working capital through current liabilities itself may be an objective. Is that a right understanding?

That's right, Bharatbhai. The working capital which right now stands at three, it will go to negative.

Now, that is the most worthy objective because liability is a way of funding assets. So मैं उसको working capital का हिस्सा कभी मानता भी नहीं हूँ.

I think working capital केवल inventory और receivables होती है. तो यदि liability के बिना हमारी working capital घटती है तो वो real reduction.

Bharatbhai, आपको इस quarter Q4 के results में आपको ये inventory और debtors बहुत minimum नजर आएगा. मैं बहुत काम किया है इस पर.

Fantastic. Fantastic.

Can we last? बहुत ही जबरदस्त तरीके से आपको reduction नजर आएगा.

जी, जी, जी. मैं आपको example बताता हूँ, अभी हमारा हर plant 12 तक का pipe बनाता था.

अब मैंने सब plant को restrict कर दिया कि 6 से ऊपर का pipe नहीं बनाएगा. अच्छा, 6 से ऊपर का सारा माल मैं Rapur ले गया उठाके.

तो like मैंने आपको example बताया, मैंने December को जब study किया, मेरा 6 से ऊपर का sales था 8,000 ton महीने का. और मैं सब including सब plants में मिलाके 50,000 ton की inventory पड़ी थी मेरे पास.

तो मैंने सब जगह खाली किया December-January में सारा माल. काफी माल partially December में तो बहुत कम हुआ, क्योंकि बाद में by mistake चीजें आईं.

January में तो मैंने सारा ही खाली कर दिया और हमने सारा 6 से ऊपर का product जो है हम Rapur ले गए. उससे क्या कि हमारे inventory days, अब Rapur में हमारा 7-8,000, 10,000 ton से सारा inventory काम चल जाएगा, 8,000 ton की sales.

तो 40,000 ton से तो मेरा सिर्फ ऊपर के product में inventory कम हो जाएगी. बिल्कुल, बिल्कुल.

तो इस सब काम के लिए बहुत काम कर रहे हैं, Bharatbhai. मेरे हिसाब से Q4 हमारा best performance result आ रहा था, इस सब प्रयासों को लेके.

जी. Now this is music to the ears.

One last question. Given the fact that volume outlook also is now healthy, mix in any case is steadily improving, Dubai operation is moving forward on a fast forward basis, and our strategic focus is now on raising the margins.

First time I have heard right at the beginning Anubhav spilling out EBITDA target objective. Otherwise we typically would gingerly at the end of some questions, you know.

That clearly tells me where things are. Will it be possible to see EBITDA of 3,000 crore plus in 27, or am I being greedy?

Right now you are greedy, Bharatbhai. अगर you frankly ask me, अभी हम सोच रहे हैं कि 42 million ton, ये 4.2 million ton और 5500 rupees ton से ऊपर का EBITDA पक्का करेंगे काम.

और अभी एक-दो quarters number को बढ़ाने के लिए मेरे को दो quarters और चाहिए होगा. मैं अभी इतना speedily नहीं जवाब दूँगा, क्योंकि मेरा कुछ नहीं बोले, बिगड़ेगा Bharatbhai.

मैंने जो goodwill बनाया है in the last 20 years, उसको खराब होने में एक मिनट लगेगा. Like, last year तक हम बोल रहे थे, हम इतना करेंगे, फिर हमने all of a sudden अपना guidance कम किया.

तो it's very hard to meet. उसके कारण मैंने बहुत छह महीने मेहनत की है कि हम एक guidance दे दें, फिर अगले quarter में आके guidance change कर दें, तो वो hurts my reference and my mind also.

तो मैं अभी नहीं वो guideline दे सकता. अभी मैं इतना confirm हूँ कि 4.2 million ton plus volume करूँगा और 5500 rupees ton से ऊपर का EBITDA पक्का निकालूँगा.

No, no, that's a very, very fair answer. Which means 28-30,000 crore in any case has to be a certain.

Ultimate एक साल आगे पीछे, मेरा जो target दिया हुआ आपने 10 million ton EBITDA जो भी है 6000 से 10,000 कहीं पर भी जरूर लेके जाऊँगा. No, delighted to hear all that I heard.

Between what you stated and you didn't state, I think this is a remarkable one. That statement about challenges should not, because Sanjay Gupta, such humans, are born only for challenges.

It's a complete... जब अपने गाइडेंस कम की थी ना, तो बहुत हत्थ हुए थे हम.

this पूरा सिस्टम पूरी ताकत से लगा हुआ है हम किसी कीमत पे अपनी गाइडेंस को वापस लेने के मूड में नहीं हैं. जो बोलेगे बहुत सोच-समझ के बोलेगे और उसको implement करने के लिए कहते हैं न, एक कतरा तक अपनी कोशिश पूरी करेंगे.

Fantastic. Sanjay ji, बहुत-बहुत धन्यवाद and Anubhav, the APL Apollo team, hearty congratulations.

Thank you, thank you, Bharatbhai. Thank you.

A reminder to all the participants, you may press star and 1 to ask a question. The next question is from the line of Aditya Welekar from Axis Securities.

Please go ahead. Thank you.

Congrats for the great set of numbers. My question is to Anubhav.

Just a few quicking questions on the capacity expansion front. In the last quarter's presentation, we have existing capacity of 4.5 million tons.

Now we have 5 million tons. The increment has come from Dubai, and what else apart from Dubai?

This 4.5 to 5 capacity, one is super heavy we had added. That got added, plus some capacity we added through debottlenecking only.

The team is working very aggressively, right, to identify that within the existing capacity how we can increase capacities by doing small-small improvements, like the mill has multiple components, replacing old components with new components, the efficiency improves. So 4.5 to 5, new capacity got added by 100-200,000 tons, and rest 200-300,000 tons is through debottlenecking only.

This speciality tubes which we were projecting earlier 0.5 million tons, it will remain the same, the quantum? Now we are targeting 2 million tons, beyond 8 million tons, to reach 10 million tons, 2 million tons will be speciality tubes.

Earlier it was 1 million tons, now we have increased it to 2 million tons. Because as we have started working, we are identifying a lot of areas where our company can work upon.

What gives us, if you can throw some use cases or demand pointers that we are now projecting higher capacity additions. Anything on that front?

From 5 to 8 journey, right, 2 million tons consists of 4 greenfield plants, one in Gorakhpur, another one in Siliguri, third one in Malur, which is in South India, and fourth in Bhuj. These are the four greenfield plants, and one brownfield expansion in Raipur for value-added products.

This put together will add 2 million tons over 5 million tons. And 1 million tons again through debottlenecking we are going to increase.

The greenfield plus brownfield expansion will require 1,300 crores, and debottlenecking expansion will require 200 crores. My question was on demand drivers, means we are expanding the capacity.

From demand perspective, do you see that, means from an overall perspective, because last one year we have seen there was some subdued demand? Yes, no, no.

Demand is not subdued. We are selling the material in one segment.

Now we have spread ourselves. Now what I am last, starting में भी बोला, now we are actually in the market, we are well in the market.

We are not going to spread anything. हमको अपना capacity full करना ही करना है.

We are very clear. What Sanjay ji is saying is that APL Apollo brand is the highest selling price point, SG brand is at the lowest selling price point, correct?

That way we have captured the market heavily. Second, see all these expansions which are coming, no?

East India, we are not selling our product in East India because we don't have any plant as yet. Gorakhpur and Siliguri will cater to all the new virgin market for APL Apollo.

Then Bhuj. Bhuj is for export market, again the segment where we have been lagging behind.

New Bangalore Malur project, right, there the capacity for the existing product is already fully utilized. We are adding new capacities.

Whatever new capacity is coming, either it is for new areas or the products which are fully utilized as on date. Third, the roofing, the value-added products in Raipur, even Raipur plant today the capacity utilization has reached 70% in quarter three.

One year down the line we also need to reinvest again in Raipur to expand the capacities because the demand for some of the products is very, very strong. We are just gearing for that.

This 2 million ton of incremental capacity, it's not going to cannibalize existing sales. It's on three-point fundamentals: new market, new product.

1 million ton is debottlenecking, say we are coming. This is overlap.

This will be overlap. Yes, but then the market will increase, assuming India consumption growth is 7-8% year on year.

That much market will increase. That's very good to hear.

Thanks and all the best. Thank you.

The next question is from the line of Omkar Ghugardare from Shree Investment. Please go ahead.

Congrats, good set of numbers. I just wanted to know this speciality tubes which you are talking about from FY28 to FY30, what kind of EBITDA per ton is there?

You can give a range, that would be fine. If you look at these speciality tubes, some of the Indian companies are present and some of the global companies which we are studying, the EBITDA spreads are in the range of 10,000 to 15,000 rupees per ton.

It will depend like what kind of product segment we get into. It's a bit early to comment.

In next two-three quarters we'll have much more clarity that which global partner, which segment we are tied up with. Yes, whatever we do, it should be above 10,000 rupees per ton EBITDA.

Here you are talking about JVs, right? In international markets?

That's right, because super speciality products, now if we build this capacity in-house in India, it will take time. Partnership with a global player always puts things on fast track and we can capture pretty quickly.

Thanks. Second one is on the capacity you mentioned.

I guess you will be doing around 3.6 million tons this year and then 4.2-4.3 million tons in FY27. Is the understanding correct?

Yes, very correct. Minimum 4.2 million tons minimum.

You are talking about 5,500 of EBITDA per ton, right? Yes, minimum.

This is minimum you are talking about. Then, with all the efforts we are doing and with the free cash we'll be generating, what kind of ROCEs you are targeting?

It can, it could hit 40 percent. How?

In FY27, right? 40-50 percent, ज्यादा हैगा.

Optically, right, on very... as on date 5,000 crores, 5,000 crores, average 6,000, 6,000, कितना चाहिए तुम्हको?

EBIT चाहिए ना? हाँ जी, ठीक है EBIT.

So 300 depreciation करके for 50 percent, 3,200 EBITDA. 3,200 EBITDA.

40 percent. So 40 percent is what you can see within FY27.

Okay. Like the free cash flow which will be generating, you will be using that to reduce the working capital days?

Or like you will be giving out some extra dividends, like increasing your dividend payout as well? We will increase some dividend payout, surely, no doubt.

Like right now we are, अगर Achieve our targets, what we are thinking, right now we are going with minimum 20 percent of dividend payout policy. We increase to 25 percent minimum.

Okay. All right.

Thank you. Thank you.

The next question is from the line of Abhishek, from DSP Mutual Fund. Please go ahead.

Hello, am I audible? Yes, please proceed.

Yeah. Sir, congratulations for great set of numbers, but mainly do you see, कि ये जो 5,500 rupees per ton EBITDA, इसमें sourcing advantages भी built-in है क्योंकि काफी capacity आ रही है as far as steel mills are concerned, is that sourcing advantage already built-in?

आप देखो, where existing sourcing कर रहा हूँ, उसमें मेरे पास कोई scope नहीं है. क्योंकि मेरे को material भी ज़्यादा लेना है, I am not looking the backward लोगों से पैसा नहीं ढूँढ रहा हूँ इस time.

क्योंकि I have to take the more material. तो इसमें sourcing advantage में कोई नहीं लेकिन मान के चल रहा हूँ.

Because जो मिलता है बस उसको maintain करना चाहता हूँ. Okay.

ठीक है. And दूसरी चीज़ Sanjay जी, ये जो 20 percent volume growth के बारे में आप सोच रहे हैं, इसमें आपको कुछ market tailwind भी लगेगा कि even market tailwind नहीं गिरा, demand में फिर भी you are confident of that number?

और सोचिया के अलबत होने के बाद market tailwind क्या कहेगी? जब चूरिया के अलबत होने के माल बेच रहा है, तो फिर market tailwind क्या कहेगी?

Since there is a market tailwind, there can be upside to this number. Yes.

Sir. Thank you so much and wish you all the best.

Thank you. Thank you.

The next question is from the line of Darshan Mehta from Axis Capital. Please go ahead.

Yes, sir. Thank you for the good question.

My question was also on the similar lines. When we target for 5,500 per ton EBITDA, what HRC price are we working with for this unit EBITDA?

No, Darshan. HRC is passed through for us, right?

There is no assumption on the HR coil pricing. Whatever price is up or down, it will be fully passed on to our customers.

We are able to fully pass it. Like there is no absorption that we have to take in our books.

We are able to fully pass it to the end customers. That's right.

That's right, Darshan. Okay.

Sir, just one more thing, when in terms of cancellation of the capacity, in the presentation it's given that for this 2 million ton greenfield capacity, Raipur would be close to 0.6 million ton. However, my understanding is this Raipur plant is for de-bottlenecking, right?

It doesn't fit into the greenfield capacity. No, no.

Within Raipur, same land, same land parcel, there will be new sheds coming up, new machinery coming up, 4-6 lakh tons. Okay.

Okay. This Raipur for 0.6 million ton is purely greenfield, and then can you give the breakup of this de-bottlenecking capacity of this 1 million ton?

That will be across the plants, Darshan. That will be across the plants.

That would be across the plants, Darshan. Okay.

One more question is on the saw increase in interest cost this quarter. However, I think debt, our total debt quarter on quarter, which is given in the presentation, has decreased.

Just wanted to know why did we see this increase in overall interest cost? It is, so, if you see, like the debt we have on the books, right, the gross debt, let's not talk about the net debt.

If we talk about the gross debt on March 25, it used to be around 600 crore rupees, 615 crores, okay, March 25, and nine months we close at 548 crores. That's the gross debt on the books.

Because there was interest rate movement during the year, this is what it is, and some bank charges because of bill discounting, etc., we do. Some increase in interest cost because of that.

Basically you are saying also overall debt has gone down, basically there are some bank charges as well as maybe increase in overall borrowing rate, which has basically likely increased. Yeah.

As we are going to have a lot of cash flow generation during quarter forward, I mean from quarter one FY27 onwards, this interest rate will reduce drastically down to almost zero levels. Okay.

Just one more question if I can squeeze, first was on this consolidated tax rate. Can we assume lower tax rate going ahead once this Dubai facility comes into play?

Already I think we are at now 22-23 percent. Would there be any more reduction in tax rate going forward once the Dubai, the plant keeps running, like once it is on stream?

Darshan, both Dubai and Raipur plants are at low tax rate, because Raipur we started in 2018 under that scheme when the government gave tax benefits for the new ventures. Eventually we expect our tax rate to be around 20 percent when the contribution from both Dubai and Raipur will be at its peak.

Okay. Can I say FY28 would see more like 20 percent tax rate?

I hope yes. Okay.

I think that was my question, sir, and congratulations on the numbers. Thank you.

Thanks Darshan. Thank you.

The next question is from the line of Sanjay Nandi from VT Capital. Please go ahead.

Hello, yeah, congrats, sir. Wonderful set of numbers.

Sir, just a broad vision picture guidance, like as we are heading for 10 million ton by 2030 from 5 as we talk. Which of the industries where we can expect the green shoots from?

From 5 to 8, we are betting on our existing industry, which is structural steel tubing, which is linked to the construction across the country for residential, for commercial, government infrastructure, real estate, private construction has been on a slow track for last two, two and a half years because of various reasons. Next three, four years look very promising, and government spending on infrastructure, once it kick-starts, then also there will be a lot of tailwinds coming in.

We are very bullish on the construction and infrastructure spending over the next three, four years. So 5 to 8 million ton is the existing structural steel tubing, and beyond 8 million ton to reach 10 million ton, that is for the special segments, new emerging categories like EVs and aerospace and highly mechanical engineering, petrochem and oil and gas segments.

That we are still evaluating and studying. Maybe in two, three quarters' time, we'll have a fine blueprint that how we are going to cater to this segment.

Sir, in the specialty segment also we are planning to supplying the structural steel, right? Which one?

In the specialty steel also we are planning to supply the structural steel, right? In the respect of those segments?

No, that won't be structural steel. That will be non-structural, like round pipes, or coated pipes, or like titanium pipes.

Structural structural steel tubes don't require that kind of specialty. Yeah.

Got it. That's it from my side, sir, for all.

Thank you so much. Thank you.

The next question is from the line of Harsh Vasa from SBI Capital Securities. Please go ahead.

Congratulations on aggregation of numbers to the entire EPL Apollo team, and thank you for the opportunity. My question was that, like currently we have a capacity of 5 million tons at the end of FY26.

By the time of FY27, what would be our exit capacity at the end of FY27, and what would be our FY28 volume growth, if you can tentatively give one rough number from FY27 by FY28 growth? FY26, the exit capacity will be 6 million ton.

FY28 target is 8 million ton, right? Almost 3 million ton will come in 24 months from April 26 to March 28.

Okay. Now exact number you can assume like 6, 6.5 million ton could be, 6, 6.25 million ton could be as at FY27, and 8 million ton by FY28.

Majority of the capacity will come in FY28 because these are the greenfield plants we are setting up. Bulk of that will start coming from Q1 of FY28.

As far as the volume growth for FY28, the guidance is that we should continue 20%, we should maintain 20% growth rate for FY27 and FY28. Thank you.

Thank you. The next question is from the line of Radha from BNK Securities.

Please go ahead. Radha, please proceed with your question.

If no response, we will take the next participant. The next question is from the line of Prashant Sharma from JM Financial.

Please go ahead. Yeah.

My question is regarding this new safeguard duty that had come into play in December. What was the impact of that on the EPL Apollo?

No impact on Apollo, except the fact that our raw material prices went up, but that is fully passed on. No impact as such.

Thank you. That's all from my end.

Thank you. The next question is from the line of Ajit Shetty from Elko Quantum Solutions.

Please go ahead. Thanks for the opportunity.

As we will be doing L1 going forward, do we expect any realization hit going forward? This is going to be a very small part of the business.

You saw that contribution in Q2 and Q3 also, and we still maintained the EBITDA spread of 5,200 rupees per ton. Whatever projections, guidance we are giving in, we have built in the volume from low category brand.

Thank you. Thank you.

The next question is from the line of Mudit Bhandari from IIFL Capital. Please go ahead.

Hi, sir. Just one question.

In the G premium, I think you said 1,500 to 2,000 is the EBITDA per ton. What kind of volume did we make in 3Q FY26?

Is there any, if we want to increase those volumes, would there be any additional assembly line or machinery different from what we are using would be required? Machinery is almost same.

We are doing almost 60,000-70,000 tons per month in quarter Q3. It depends on our balanced product mix sale.

If my sale is less in the other my premium products, maybe I go for 1 lakh ton in a quarter. We have no problem at all because machinery is same.

I hope this answers your question. Can we take next one, please?

Thank you. The next question is from the line of Pallav Agarwal from Antique Stock Broking.

Please go ahead. Good evening and congratulations on the record quarter.

A couple of questions. One is, with the safeguard duty and HRC prices going up, are we seeing some restocking demand happening in the quarter?

That can lead to better volumes? Very minor, Pallav, because it's too early for channel partners to act on this.

Once there is more clarity on how prices will behave, then restocking should start. Okay.

The other question was on the purchase of stock in trade. In some quarters, it is a pretty high number.

Even this quarter, it's about 329 crores. Is this...

Hello? Did you no response?

We will take the next participant. The next question is from the line of Omkar Ghugardare from Shree Investment.

Please go ahead. I just wanted to know with the recent upside in all the commodities, will there be any impact on the guidance which we have given?

We cannot comment on the revenue front, but what would be your prediction on that? Sorry, say it again?

Prediction on what? Prediction on overall guidance which you have given of 20% volume growth.

Where do you see the trajectory of commodity prices and how much it can impact your overall revenue? We don't factor in how steel prices will behave, because there is no major where we can have clarity while working on our business plan for next two years.

We work on a simple fundamental that whatever increase or decrease in raw material prices we get, we immediately pass it on to our customers. This we have been doing for many years now, and our channel partners, our network of 800 distributors, has also kind of got used to this model.

Not only us, but our competitors also work on the same fundamental. Industry has adopted this that the increase or decrease in raw material prices should be easily passed on to the customers.

Generally, how much is the lag in that? Five to eight days.

Oh, just five to eight days. That's right.

Practically speaking, there should be no impact because of the steel prices or the commodity price increase, if it sustains like this? Unless there is a drop or increase of, like, 10% or more in a single quarter, right?

Which happens, like, once in 10 years. Last year we had this impact, but we don't expect this to come again, such a sharp increase or decrease again during this decade at least.

Okay. Lesser than that is easily passed on, right?

As you said, within the same quarter or maybe in seven-eight days. That's right.

That's right. Okay.

No problem. Thank you very much.

Thank you. The next question is from the line of Kumar Saumya from Ambit Capital.

Please go ahead. Hi, Anubhav.

Just one question from my side. I was trying to understand maps here.

The market is roughly 10 to 12 million tons. Assuming 55% is your HRC coil-based, that implies five and a half to six and a half million tons.

Now based on 20% guidance, you would be touching four and a half million tons next year. If I remove 200,000 tons for SG premium and 300,000 tons of Dubai, you are left with 4 million tons for domestic market.

That implies 65% market share. Your competition is also planning for capacity additions.

How comfortable are you with this volume? Kumar, 65% market share we've been maintaining for almost four years now after COVID.

Before COVID we were at 40. Now after COVID, from 2021 straight into 25, as we enter into 26, we are above 60%.

Sanjeev, you want to add to this? Yeah.

Number two, Kumar, our commission mein I think number two jo player hai, like we are talking four lakh ton per month hai, to number two player jo hai 15-20,000 ton par hai. To wo capacity add bhi karega, two saal, five lakh ton add kar lega, 10 lakh ton add kar lega, usse utna koi farak nahi padna chahiye.

Okay. Number two, hum SG premium mein bahut zyada aggressive hain, ki humara jitna volume kam hoga hum SG premium bechke jayenge hi jayenge.

Whatever the price. Maybe price is less than HR coil or maybe price is less than patra, maybe price is less than anything.

In this guidance of 4 to 4.5, what is the estimate that SG premium will command in terms of volume share? 3 to 4 lakh ton humne pakda hai, ki mujhe zaroor padega.

Under 10%, Kumar. Under 10%.

Okay. Okay.

Thank you, sir. That will be all from my side.

Thank you. Thank you.

Thank you very much. As there are no further questions from the participants, I now hand the conference over to the management for the closing comments.

Thanks, Kumar and Ambit for hosting Apollo for its quarter three earnings call. Thanks to all the participants who dropped by.

Look forward to see you again during Q4 FY26 earnings call. Thank you so much.

Thank you very much. On behalf of Ambit Capital Limited, that concludes this conference.

Thank you for joining with us today, and you may now disconnect your lines.