Transcript of Earning Call related to the unaudited financial results for quarter and half year ended September 30, 2025
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Rathi Steel & Power reported Q2 FY26 total income of approximately INR 156.4 crores with EBITDA of around INR 6.37 crores (about 4% margin), and H1 FY26 revenue of around INR 311 crores with EBITDA of about INR 12.6 crores. Sales grew roughly 27-28% year-on-year, from about INR 121 crores in Q2 FY25. Revenue mix is roughly 60-65% stainless steel and 30% from the recently recommissioned TMT bar business. Melting shop capacity utilization stands at 55-60% and rolling mill utilization has improved to 40-50% (from ~25% last year), with the company targeting 80%. Management acknowledged industry-wide pricing pressure and import-driven margin compression, but reiterated a guidance of approximately 20% CAGR growth for the next two years. The company is pursuing green steel positioning, rooftop solar, and green certifications, while negotiating its cost of debt down from 18% to about 16%.
The flat ~4% EBITDA margin despite improving volumes signals that margin recovery is still ahead, not yet delivered. For shareholders, the 20% CAGR guidance, capacity utilization ramp-up, and TMT backward integration plans are key forward catalysts, while near-term margin pressure from imports remains a risk.