Note: This is a preliminary transcript and may contain inaccuracies. It will be updated with a final, fully-reviewed version soon.
Bmw Industries Ltd (NSE: BMW) Q4 2026 Earnings Call dated May. 07, 2026
Corporate Participants:
Sanjeev Sancheti — Investor Relations
Harsh Bansal — Managing Director
Analysts:
Ronak Osthwal — Analyst
Unidentified Participant
Darshan Jhaveri — Analyst
Unidentified Participant
Unidentified Participant
Unidentified Participant
Presentation:
Operator
Ladies and gentlemen, good day and welcome to the BMW Industries Limited Q4FY26 conference call hosted by Ariant Capital Markets Limited. As a reminder, all participant clients will be in the listen only mode and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call please signal an operator by pressing star then zero on your touchstone phone. I now hand the conference over to Mr. Ronick Ostwal from Ariane Capital Markets Limited.
Thank you. And over to you sir.
Ronak Osthwal — Analyst
Thank you. Hello and good afternoon to everyone. On behalf of ariane Capital Market Limited I thank you all for joining into Q4 and full year FY26 earning conference call of BMW Industries Limited today. From the management we have Mr. Harsh Bansal, Managing Director Mr. Vikram Kapoor, Chief Financial Officer and Mr. Sanjeev Sanchetti, Investor Relations at EURIP assignment. So without any further delay I will now hand over call to Sanjeev sir for their opening remarks. Over to you sir.
Sanjeev Sancheti — Investor Relations
Thank you. Good afternoon to all the participants. Before I hand over the call to Mr. Harsh Bansal for his opening remarks I would like to draw your attention to the safe harbor statement including in the earnings presentation. I request all the participants to kindly review the same and have a good look at it prior to the commencement of the Q and A session. Thank you. Over to you Mr. Bansal.
Harsh Bansal — Managing Director
Thank you sir. Good afternoon everyone and thank you for joining us for the BMW Industries Ltd. Quarter four and full year earning call. With this quarter’s performance we closed FY26 on a high note with the company delivering a strong performance alongside meaningful progress on our strategic priorities. The results reflect not just improved capacity, utilization and disciplined execution but also the strength of our operating model and the momentum we are building as we enter the next phase of growth.
We are delighted to report our highest ever quarterly and annual profits for the quarter gone by. Operating income stood at 210 crores. Operating EBITDA for the quarter came in at rupees 58 crores with a margin of 27.5% while profit after tax came in at a record 33 crores translating to a PAT margin of 15.4%. For the full year. Company delivered operating income of 665 crores with operating EBITDA of 165 crores and a margin of 24.8%. Profit after tax stood at 81 crores reflecting a healthy tax margin of 11.9%.
The performance is a direct outcome of our disciplined approach and improved Utilization of assets during FY26, the company witnessed strong operating momentum across its downstream businesses with CRM complex production increasing to 718,000 metric tons and annualized utilization improving to 70.9% from the December number of 66.9%, reflecting a stronger capacity utilization and improved operational efficiencies. The pipes and tubes segment also recorded a healthy production growth during the year
Sanjeev Sancheti — Investor Relations
With
Harsh Bansal — Managing Director
Production increasing to 201,000 metric tonnes from 177,000 odd metric tons in FY25. Our focus on sweating the asset base is expected to further strengthen return ratios in the years ahead. We believe this sets a strong foundation for further improvement in return ratios as we scale. Reflecting on this performance, the Board has recommended a final dividend of 43 paisa per share resulting in a payout ratio of 12%, reinforcing our commitment to delivering consistent shareholder returns while continuing to invest in growth.
Net debt during the year stood at 364 crores with a net debt to equity ratio of 0.45x. Net debt also includes debt drawdown on account of the Bukaro Greenfield project to the extent of 143crores. Net debt to equity excluding borrowings for the Gokaro project stood at 0.27x. Importantly, healthy and consistent operating cash flows enabled the company to invest 109 crores of internal accruals into the expansion at Bukhar. FY26 has been a pivotal year operationally marked by strong progress on our greenfield downstream steel complex at Bukaro which remains on track for phase commissioning starting quarter one FY27.
In anticipation, the Company has begun establishing its sales and distribution networks ensuring we are well positioned for a seamless ramp up. We have also made significant advancement in our sustainability journey through our partnership with the Indian Oil Corporation for the supply of pipe natural gas at Bukaro, enabling cleaner and more cost efficient operations. Looking ahead, the Company is entering a transformational phase of growth driven by higher utilization of existing capacity and the phased commissioning of ramp up of the Bukaro Greenfield project as the business evolves towards a more integrated and balanced operating model.
Combining its established conversion strengths with a proprietary sourcing and distribution framework, the Company expects to capture a larger share of the value chain while further expanding and diversifying its customer base. We reiterate our earlier guidance of a CAGR of approximately 75% over FY25 to FY28 period supported by the phased commissioning and ramp up of Bocado Greenfield project along with continued organic growth across the existing business verticals in line with the above guidance, operating EBITDA and PAT is expected to grow at a CAGR of nearly 45 and 40% respectively over the same period.
EBITDA and PAT margins are expected to gradually stabilize at around 12 to 13% and 5 to 6% respectively by FY28 as the benefits of integration, scale and operating leverage begin to materialize. Given recent developments, we believe that the industrial landscape of Eastern India should get into a favorable phase of transformations. We hope that stable and progressive policies support rising infrastructure investments and a stronger push towards industrial development in the region will provide positive tailwinds.
With strong execution momentum, capacity expansion progressing as planned and a clearly defined strategic roadmap, the company remains confident in its ability to scale meaningfully, enhance profitably and create sustainable long term value for all stakeholders. With that, I will now open the floor for questions. Thank you,
Questions and Answers:
Operator
Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press STAR and one on the Touchstone telephone. If you wish to remove yourself from the question queue, you may press star and 2. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles.
Unidentified Participant
We have first question from Shlok Bhatir from Swan Investments. Please go ahead.
Darshan Jhaveri
Thank you for the opportunity. Am I audible?
Harsh Bansal
Yes, please continue.
Darshan Jhaveri
Just wanted to understand on the console level, as you indicated, the EBITDA margin stable around 13 14% over by FY28. So can you give a breakup in terms of our existing business and how the Bocado performance will play out over the next two to three years?
Harsh Bansal
So thank you for the question. Shlokji. One small correction. The EBITDA will stabilize at 12 to 13, not 13 to 14. The existing business as is will. We don’t see any meaningful investments happening on this side as of now. So whatever benefits come will be on account of increased capacity utilization. For example, from the Tubes division where we have created substantial capacities but are fairly underutilized. So over the next two to three years we expect the utilization levels to go from the existing 30:34 odd percent to closer to 60 to 65%.
Darshan Jhaveri
So that
Harsh Bansal
Is for the existing business. On the Bukaro side, I think we’ve spoken about the capacities that are being created and that’s a part of the presentation. Shimona, can you just open that screen please where over the next 12 to 15 months, as we continue to commission various parts of the project, those volumes will come in and then FY28 we will scale up those Volumes in a meaningful manner. So I mean those numbers are there for you to see.
Darshan Jhaveri
So is it safe to assume that if we ramp up our capacity of tube in our existing business so the revenue of 665 crores that we reported in FY26 can go max up to 800 or 900 crores. Such a peak revenue one can assume for your existing facility. And what sorts of integration benefit like once you are starting in a. I mean as per your presentation the phase one of a Bokaro is expected to come on stream in Q1. So. So can you also throw some lights which all facilities coming in Q1.
Harsh Bansal
So on the first part I think your assumption is fair in terms of the top line that can be derived from the existing businesses. On the second part of your question we are looking at starting saleable production of the color coated section in this quarter. This will be then followed in subsequent quarters by the Galvanum facility, cold rolling, pickling, etc.
Darshan Jhaveri
Okay. Okay. So color and then it will be a gal value. So once your project is completed on the Bokaro value are spending near about 800 odd crores. What sorts of IRR are we working on? And in terms of if one was to look at the PayPal period understand that the capacity will be fully operational once in FY29. But if you look at the IRR what sort of IRR one can look at it.
Harsh Bansal
So you know our base case for an investment is a 20%. So this in this case it’s. I mean it’s safe to say it’s above that.
Darshan Jhaveri
Almost five, four and a half I guess. Yeah. That’s all from my side. Thank you and all the best.
Harsh Bansal
Thank you.
Operator
Thank you. A reminder to all participants, anyone who wishes to ask a question may press star and one on the touchstone telephone. We have next question from Dashi Javeri from Crown Capital. Please go ahead.
Darshan Jhaveri
Good evening sir. Thank you so much for taking my question. Firstly, congratulations on the great set of results.
Harsh Bansal
Your voice is very unclear. May I please request you to kind of repeat. Hello.
Darshan Jhaveri
Yeah, hi. Is this better sir? Okay. Am I audible? Yeah, yeah, yeah. So thank you so much for taking my question sir. And congratulations on a great set of numbers. Sir, I just wanted to harp a bit upon on the you know capex the you know phase one that we are going to start in Q1. So can you just tell me the ramp up, how will it happen? Like is the, you know, in H1 will we you know need to you know put out some testing and then the commercial production can happen by Q2 or Q3. How would the ramp up be?
And what kind of revenues can we expect from, you know, phase one in FY27? Sir.
Harsh Bansal
So Darcy, we have not gone into detailed economics and projections about what kind of revenues we can expect on a breakdown manner. We’ve given an overall guidance in terms of up to FY and you know, I would like to stick to that. But in terms of your, you know, part of the question of how much we are looking in terms of color coding and all that. So color coding will come online. You should have some sales in quarter one, but meaningful sales will only happen by quarter two because once we start production, we will take time to stabilize on quality, volumes, acceptability of the product, etc.
So this is why we are not giving a breakup quarter wise revenue estimate, but we’ve given a more broader longer term guidance.
Darshan Jhaveri
I was not wondering a quarter wise, just like in terms of a rough range like in FYI 27, what could we, you know, expect from this? Because why am I coming to this? Also because as the revenues ramp up we’ll have. But the cost will be nearly fully. Right now our EBITDA will dilute a bit. So just wanted to understand how would that kind of work? I don’t want any exact number, just a rough, you know, broad color will also, you know, be fine. Sir,
Harsh Bansal
We would refrain from giving any kind of quarter on quarter guidance. The second part of the question, Dasherji, where you’re looking, you mentioned about dilution of the ebitda so that it should be seen in the context of a changing business model and not really a dilution. So if you look at the absolute returns of EBITDA numbers, there is a substantial increase. But because we are in a conversion model today and we will be in a buy and sell model tomorrow, so that the absolute numbers will be reflected accordingly.
So it’s not really a dilution if you consider the change in model.
Darshan Jhaveri
Okay, fair enough. And sorry, last one question from I in this terms of accounting. Because we are starting the phase one right now, the depreciation and interest will start hitting from Q1 right like that.
Harsh Bansal
We will be capitalizing it on a phase wise manner depending on which part of the project we commission. And therefore accordingly, on a quarter, on quarter basis, whatever we commission will get capitalized and reflected in the number. Yeah,
Darshan Jhaveri
Okay. Okay, fair enough. Thank you so much.
Operator
Thank you. The next question is from Priyanka, from Value Money. Please go ahead. Yeah, Priya, your line is open. Please Go ahead. I think
Unidentified Participant
Take
Operator
Next question. We have next question from Mr. Bhavesh as an individual investor. Please go ahead.
Darshan Jhaveri
Good afternoon, Mr. Bantal. Congratulations on a good set of results. My first question is on the revenues. So we have observed a sequential improvement in revenues from Q3 with a strong uptick in Q4. So should we expect this momentum to continue in the coming quarters particularly leading up to the commissioning of phase one of the Bukaro plant.
Harsh Bansal
So Bavenji, thank you so much for the question and welcome back. Good to hear you again. I don’t think the same momentum will continue because you know, if you look at the existing numbers, they don’t reflect Bukaro. And with the existing business, other than certain capacity utilization variations, we are not seeing any meaningful change when it comes to Bukaro. Like I mentioned to Darshanji, you will have meaningful sales top line reflected starting from quarter two. In quarter one. There will be some.
But I won’t want to club those sales with these sales for the. You know, for the benefit of not confusing you.
Darshan Jhaveri
Understood that was helpful. The next question is with respect to the trade receivables that has increased significantly from approximately 80 crores to in FY25 to around 150 crores in FY26. So could you elaborate on the key drivers behind this increase?
Harsh Bansal
If you even look at the receivable days, I think this was all on account of one of our key customers holding back payments because of March quarter. This led to this number. We actually got the payments in early April. So it was more of a timing issue. But anyway it got reflected in the balance sheet because it’s of the 31st of March.
Darshan Jhaveri
Understood, sir. Next question is on the downstream plan. So the presentation indicates that the phase one commissioning will happen in Q1, FY27. So since we are already in the month of May, could you provide a more precise timeline for commissioning? Are we looking at late May or June? And what is the expected timeline for phase two? And additionally, I would request the company to issue a press release once it commissions phase one so that all the investors are well aware. Of course,
Harsh Bansal
Of course. So I’m sure you will hear about that when we hit proper commissioning. But we expect to start some form of coal trials before the end of this month and hot trials in June. And of course once we get to saleable material, you will be. I mean you’ll be able to read the releases.
Darshan Jhaveri
So on this Bukaro facility, so it is focusing on high value added products. So could you share some Your go to market strategy. Have you identified or engaged with potential customers in the automobile, infra, solar, defense, engineering, space. And I’ll proceed with Dean for the part.
Harsh Bansal
So not specifically the sectors that you mentioned it but I want to give you the comfort that we’ve already started going to market and discussing with potential buyers without, you know, without mentioning specific industries.
Darshan Jhaveri
So these sales will be driven.
Operator
The management is able to address questions from all participants. Please limit your questions to participants.
Darshan Jhaveri
Please join the feedback. Thank
Operator
You sir. We have next question from Mr. Sanket as individual. Please go ahead.
Darshan Jhaveri
Yes sir. So we have a listed peer Manaksia color coated. So they are also into the business which we are doing Capex in. So can you just throw a light like they do EBITDA margins in the range of 5 to 9% and we are guiding somewhere around 12 to 13% at stabilized levels. So how is our product mix different from them? Can you just throw some light on that?
Harsh Bansal
So two things Sanket ji. One, I think our business model on a blended basis is different.
Darshan Jhaveri
Okay. So the 12 to 13% is not just for the.
Harsh Bansal
It is a blended company’s guidance and not the Bukharu plant guidance. So that is one. The second is I think our capacities on a complete basis differ substantially which allows us to maximize our efficiencies of scale.
Darshan Jhaveri
Okay. And exports will be what chunk of our revenue going forward because they have significant chunk of their revenue as exports.
Harsh Bansal
So we can’t give you a specific number but I think it will be safe to say that we will be looking at the export market very seriously
Darshan Jhaveri
And EU will be one of the key markets. Given that eu
Harsh Bansal
I wouldn’t want to discriminate against anyone. So I’ll give all markets the benefit of having my wonderful product.
Darshan Jhaveri
Yeah, that’s all.
Harsh Bansal
Thank you Sanket.
Operator
Thank you sir. The next question is from the line of Ajit City from ICO Quantum Solutions. Please go ahead.
Unidentified Participant
Yeah, thank you for the opportunity. So you are guiding for around 75 revenues at next three years. So could you help us understand the key growth driver behind this guidance and also how confident are we in achieving this target? Do we currently have an order book or customer visibility supporting this growth outlook?
Harsh Bansal
So thank you for the question. Ajit Ji. It’s actually not a guidance of the next two years. It was a three year guidance starting from FY25. And so 75% CAGR up to FY28. And this is not an annual, on annual basis it’s a 3, 3 year CAGR. So that is part of the. That is one part. The second part of yours was the product mix and everything and order book. And it’s a little early for us to be accumulating an order book because my plants have not yet commissioned. But in subsequent calls I’ll be happy to talk about the order books, etc.
But a lot of these products are not long gestation sales periods. You typically have a order to delivery gap of maybe about two weeks. So the order book kind of becomes a little moot. The other factor being that because some of the components are highly volatile in nature, for example zinc or aluminium or magnesium, going forward it will be very difficult for us to take long forward orders without a proper current hedging strategy. You know, that could expose us to substantial downside risk.
Unidentified Participant
So could you help us understand the key competitive advantages of the company and what differentiates us from other players in the industry?
Harsh Bansal
So I think without going into too much detail on that, I think this is all a part of the presentation pack. But needless to say we’ve been around in the service sector for the last 40 odd years. We’ve been working with key customers in the Indian steel industry. We are one of the largest downstream steel processing operations in the country, one of the largest single location tube capacities in the country. There are a whole bunch of things, I think we are one of the few players that are present across verticals along with, you know, logistics and things like that.
So I mean for more detailed thing it’s, it’s a part of the presentation pack.
Operator
Okay, thank you sir.
Harsh Bansal
Thank you.
Operator
Thank you participants. We will remind anyone who wishes to ask a question may press star and one on the test on telephone. We have next question from Priyal from Value Money. Please go ahead.
Unidentified Participant
Thank you for the opportunity. How much of the new Bukaro capacity will be consumed internally across the value chain versus sold externally? And can you quantify the integration benefits from reducing intermediate outsourcing and purchases?
Harsh Bansal
So really I’ll answer the first part of the question. I’m not sure I understand the second part so I’ll come back to you on that. But on the first part, if you look at the, if you look at the product profile of Bokaro, we have about 5 to 600,000 tons of pickling capacity. We’ve got cold rolling capacity of 3 to 4 lakh tonnes. And then on top of that we’ve got galvanizing GI and XAM capacity of about 5 to 6 lakh tonnes. So and color coating of about 2 lakh tonnes. So if you look at salable products it will be the differences because the highest value added, the color code.
So the leftover of about let’s say 3 to 4 lakh tonnes will be in the form of galvanized galvolume or xam. And if there is any other balance it will be in the form of FHCR or hrpo. So there is a trickle down. But the overall sales from the unit at peak will be about 6 lakh tons.
Unidentified Participant
Okay, sir. And.
Harsh Bansal
So the internal consumption has two factors. Clearly. You know my cost of procurement goes down because I’m able to kind of control my own raw material. The second is I’m also able to control my quality which becomes very critical over here. Because the controlling mill will ensure I have a good product and control on the galvanizing galvanum and xam. Which further adds value to my control on the color coated. So one of course is reducing the cost of raw material. The second is the control on quality.
Unidentified Participant
Okay. Got it, sir. And there’s one more question. How are spreads behaving currently across hrcr, GI and color coated segments have recently price movements improved realization or compressed downstream margins.
Harsh Bansal
So you know, if you look at long term averages, the spreads are fairly stable. There are short term aberrations from time to time. And in the steel industry it’s best not to focus on the short term aberrations. I think long term the spreads are positive.
Unidentified Participant
Okay, sir. Okay. Thank you.
Harsh Bansal
Thank you.
Operator
Thank you.
Unidentified Participant
Thank you.
Operator
The next question is from Kunal Bantal. From Anant Nath Sky Skycon Private Limited. Please go ahead.
Harsh Bansal
Hello, sir. Hi Kunal.
Darshan Jhaveri
Hi. So sir, I just wanted to confirm. Like earlier in the call, you guided a 75% CAGR for revenue. 45%. 40% CAGR for PAT. So is it annual growth or combined growth till FY28?
Harsh Bansal
So this is a compounded annual growth rate between FY25 and FY28. So if you take the two numbers of 25 and 28 this will be a compounded growth number.
Darshan Jhaveri
Okay.
Operator
Thank you, sir. Thanks. If you. If you wish to ask any question, you may press star one. We have follow up question from Mr. Bhavesh as individual investor. Mr. Bhavesh, please go ahead.
Darshan Jhaveri
Thank you for the opportunity. Sir, I have a couple of questions. In your investor Presentation, slide number 16, you have highlighted benefits under Jharkhand industrial and investment promotion policies. Including capital subsidies, HGST reimbursements, our duty incentives. So could you quantify the potential financial impact of these incentives?
Harsh Bansal
So Babishji, if You look at the little script at the bottom of the page. There is a reason why we are not quantifying. It is because we don’t know the exact numbers that we will receive. And so we have not even taken it as a part of our financial projections. But whatever we receive, whenever will be duly reflected. The other part is as a policy that we have internally, any subsidies we receive going forward, whether it’s the Jharkhand or PLI or whatever will be used to repay the debt. And that’s a part of our agreement we’ve also committed to the bank.
So that’s right.
Darshan Jhaveri
Understood. So one last question. So could you please provide details about the technology and automation at the Bukaro plant. And additionally I would like to know your technology provider and etc partner for this Green team project.
Harsh Bansal
So in terms of technology, you know this is not. This is not new technology. It’s been around for a long time. You’ve got a number of plants around the country who are using similar technology. Our partners are the equipment vendors from whom we’ve procured. I don’t want to go into the details. I’m not sure whether I can disclose the names at this point. But what is the other part of the question, Bhaveji?
Darshan Jhaveri
So automation. So technology provider and etc partner for this project or any other.
Harsh Bansal
No. So we don’t. I mean we are not using nnt but we are using others who are more locally available. Yeah,
Darshan Jhaveri
Got it. Sir, thank you so much for answering all my questions. And all the best for the upcoming. Thank
Harsh Bansal
You. Thank you again.
Operator
Thank you sir. Participants, anyone who wishes to ask a question may press star and one on the Touchstone telephone. The next question is from Rohan Baranwar from Ask. Please go ahead.
Darshan Jhaveri
Hi. Thank you very much sir, for the opportunity, my question is on the XAM coated product side. So can you please explain us the opportunity size for the XAM coated production in India?
Harsh Bansal
So wonderful question, Rohanji. So if you look at the move of the industry, it’s essentially towards more longevity steel coating processes but also lighter steel and steel which provides more value for money. Because of that we went into galvanizing, we went into high tensile steels which provide higher strength at lower thicknesses. And similarly if you look at xam, the industry is starting to move towards magnesium coated because of higher life expectancy. Now if you look at a galvanized product, it typically has a life of about four to five years at standard coating.
Now to increase the life, what Indian customers have been asking for is about 3x4x coating, which makes it very expensive considering zinc is currently at about 3.25 lakh rupees per tonne. Now there is only so much you can do, right? Because I can’t indefinitely keep coating zinc at those prices. You might as well then at some point start using zinc sheets and not steel sheets. Now to get better value for money you start looking at other alternatives. One of which is zamp, zinc, aluminium, manganese, same to same coated providing provides about 5x to 6x of the life of zinc.
Now if you are able to provide 5x6x lives at same coating as zinc, there is a substantial value to be derived by the customers. One of the impediments today is that even though there is demand, there is not adequate supply. You will see supply coming onto the market over the next few years, one of which will be ours. And once there is adequate supply we expect the market to also develop much faster. So this is kind of a chicken and egg story where you can argue that there is no demand because there is no supply.
There is a lot of demand from host of sectors. Solar is one of those because today any EPC supplier in the solar sector has to give commitment guarantees of let’s say 20 or 30 years. But zinc coating does not provide those kind of lights, whereas AM does. So you know we are actually quite positive on that.
Darshan Jhaveri
And what is the premium pricing we can expect? Like what would be the premium we expect compared to like GI or GL products galvanized? I am not
Harsh Bansal
Actually there is a little bit of premium but then you know this is like looking into a crystal ball because in the future I don’t know how much supply or how much demand will be there. But needless to say there is a marginal premium over gi. Now if there is a case made of value derived by the customer, then some of that value can be converted to rupees and dollars I guess
Darshan Jhaveri
On the python silk side. So what is the current utilization level and what is the TMT businesses which remains relatively low despite the current expansion? So what are the key bottlenecks do we see on that side, sir?
Harsh Bansal
So on the TMT rolling mill side we have raw material constraints. On the customer side we are working with them to see how some of those things can be sorted out. What can we do in terms of enhancing our capabilities if that would help. On the pipes and tube side you will notice that there has been a substantial increase in the installed capacity which has gone in the last year from less than 6 lakh tonnes to about 7.3, 2 lakh tonnes today on a utilization level, even though we have increased utilization by about 50% overall we are still at about 34.2% now.
We expect stable state tubes and pipes utilization to be in the range of about 60 to 65% and we hope to get there over the next maybe two to three years.
Operator
Thank you Mr. Ron. Please rejoin the queue. Ladies and gentlemen, in order to ensure the management is able to address questions, please limit your questions to per participants. Participants. If you want to ask any question you may press star one on your touchstone telephone. We have next question from Shlok Bhati from Swan Investments. Please go ahead.
Darshan Jhaveri
Thank you for the opportunity once again. Sir, just wanted to understand once a facility comment in Bukaro what sorts of working capital cycle? One can assume because I can understand that in month of March because of a higher risk database from one customer has taken a hit. But on a steady state basis, if you just want to understand the Bukaro dynamics, what’s the working capital cycle once you look at the Bukaro unit?
Harsh Bansal
So we are targeting a working capital cycle of about 30 days in Bukaro. But you know, I mean a lot of it will depend on where we buy the steel from, what is the product that we ultimately sell, how much inventory we need to carry on the FC side etc. But I think it’s fair to say between 30 to 40 days is comfortable.
Darshan Jhaveri
And the entire production from the Vocaro would be under our brand, right? BMW?
Harsh Bansal
That’s right.
Darshan Jhaveri
And what sorts of advertisement expenses are we planning to incur to establish the brand BMW in the market?
Harsh Bansal
So this will essentially be a B2B so I don’t see very high advertisement spends because you know, whatever will come only after FY29, FY30 because up to that stage our focus is on B2B enhancing volumes and moving more and more product. So I don’t see substantial B2C kind of ad spends. There will of course be some but they’ll primarily be targeted towards B2B sales.
Darshan Jhaveri
So is it safe to assume that are we going to replicate our existing business? Definitely. We have a one segregated customer. But are we in touch with the couple of big names in the Bukaro for converting the calls into the final product and selling back to them? I mean it’s Gadgeto,
Harsh Bansal
We are not in touch with anybody for conversion at Bukharo.
Darshan Jhaveri
Oh, okay, okay, okay, okay, okay, okay. And in terms of the debt, I mean definitely 800 crores is a bigger capital that you’ll be spending it and we’ll be drawing a debt from the bank. But off for the completion. What sorts of peak debt one can assume on the company level.
Harsh Bansal
So I think once we look at the completion and the commissioning of this project that will be the peak debt. And we’re not talking about the working capital etc right now. But in terms of long term debt we’ll be at the peak by let’s say in the next 12 to 15 months.
Darshan Jhaveri
Because currently our total debt on the book is almost 370 crore. Top as 135 is optimum borrowings. Right. So this 4, 370 crores. Can we probably take it around 800 crores or 700 course by end of FY28.
Harsh Bansal
That’s fair. That’s fair. That’s a fair assumption.
Darshan Jhaveri
Okay. 700 to 800 could be the numbers. Thank you. That’s all from my side. Thank you.
Operator
Thank you. Sir, we have a follow up question from Mr. Ajit Seti from Eco Quantum Solutions. Please go ahead.
Unidentified Participant
Thank you for the opportunity, sir. Once again. So in our legacy business at peak utilization, what kind of revenue we can achieve?
Harsh Bansal
I think this was a question somebody else also asked. I think it’s fair to assume between 8 to 900 crores.
Unidentified Participant
800. Okay. And sir, coming to your guidance of reaching 75% CAGR within FY25 to 28. So for to achieve this you have to grow substantial revenue in FY27 and 28. So how confident you are to achieve this growth guidance?
Harsh Bansal
Fairly confident. No reason for not being confident.
Unidentified Participant
So what? So can I know the growth drivers in this guidance?
Harsh Bansal
So the primary growth driver at Easy is Bukaru. Right? My current revenue comes entirely from conversion business where there is no raw material reflected in the cost of sales. But starting from this quarter or the following quarter you will start to see a lot of the absolute sales numbers increasing. Because it will also account for the cost of material. Today it’s entirely services. So. And therefore the CAGR changed substantially.
Unidentified Participant
Okay. And from this phase one Vocaro capacity, what kind of revenue we can achieve?
Harsh Bansal
Stage one. We are not giving a breakdown of stage wise or quarter wise. So I think we’ll just stick with that. If you see.
Unidentified Participant
Okay, no problem. Thank you sir.
Harsh Bansal
Thank you.
Operator
Thank you. Thank you. Participants, to ask any questions you may press star one star N one on your test on telephone. The next question is from Mr. Rohan Baranwal from ESK. Please go ahead. The line is open.
Darshan Jhaveri
Yes. So my question is on the Bukaro coated steel side. So what kind of EBITDA per turn margins are we expecting on the book? Like the coated steel business versus the legacy conversion business. And question is. Yes,
Harsh Bansal
So Rohanji, we are not giving breakups of Bukaru and existing businesses. We’ve given a company wide estimate and further I think it’s a little early to give you product wise breakdown of per ton EBITDA and those will come in due course.
Darshan Jhaveri
And with the investment of 800 crores. So what kind of roce we are expecting with the with this business with the new plan which you are executing.
Harsh Bansal
So on a blended basis we expect 15. We expect to reach 15 plus.
Darshan Jhaveri
And how much would be infused through debt and what would be the equity we are looking to raise for this investment? You
Harsh Bansal
Know on the total cost of 803 crores our debt equity is at roughly 250 to 300 of equity and balance of debt.
Darshan Jhaveri
Got it sir. And will this be funded through like cash flows coming from the current capacity?
Harsh Bansal
Yes, primarily.
Darshan Jhaveri
Next last question is given the shift towards the value added product how like we should think about the blended margins improvement in the over the next two to three years Sir.
Harsh Bansal
So we’ve given a guidance of EBITDA Blended EBITDA is in the range of 12 to 13% and packed in the range of 5 to 6% on a blended basis.
Darshan Jhaveri
That answers my question. Thank you very much.
Harsh Bansal
Thank you. Thank you Rohanji.
Operator
Thank you. As there are no further questions from the participants I now hand the conference over to management for closing comments.
Sanjeev Sancheti
Thanks everybody for taking out time to join this call. Really appreciate. If you have any further queries please feel free to get in touch with us. Thank you.
Operator
Thank you. On behalf of ariant Capital Markets Ltd. That concludes this conference. Thank you for joining us and you may now disconnect your lines. Thank you.