Note: This is a preliminary transcript and may contain inaccuracies. It will be updated with a final, fully-reviewed version soon.
Jindal Saw Limited (NSE: JINDALSAW) Q3 2026 Earnings Call dated Jan. 19, 2026
Corporate Participants:
Vinay Kumar Gupta — President and Head Treasury
Analysts:
Vikash Singh — Analyst
Ashwatha Dixit — Analyst
Abhishek Maheshwari — Analyst
Deepak Podar — Analyst
Rajesh Agarwal — Analyst
Unidentified Participant
Darshan Gangar — Analyst
Presentation:
Operator
Ladies and gentlemen, good day. Hello and welcome to Jindalso Q3FY26 earnings call hosted by ICICI Securities Limited. As a reminder, all participant lines 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 start then zero on your touchtone phone. Please note that this conference is being recorded. I now hand the conference over to Mr.
Vikas Singh from ICICI Securities Ltd. Thank you. And over to you, sir.
Vikash Singh — Analyst
Thank you, sir. Good evening everyone. On behalf of ICICI C30, I welcome you all. I would like to thank the Jindosa Management for giving us the opportunity to host their call. From the management side we have with us Mr. Narendra Mantria, Chief Operating and Financial Officer. Mr. Vinay Kumar, President and Head treasury. And Mr. Rajiv Goya, Senior Vice President in Corporate Finance. Without taking any much time, I’ll hand. It over to Vinay sir for his opening remarks. Over to you sir.
Vinay Kumar Gupta — President and Head Treasury
Thank you Vikas and let me start the call. Good afternoon everyone and welcome to Jindal source Q3FY26 earnings call. We wish everyone a very happy and prosperous New year. I, on behalf of General SA Management would like to extend our sincere appreciation to ICICI Direct for their support in coordinating today’s call. The unaudited financial results for quarter three of fiscal year 26 were approved by the Board of Directors at his meeting on January 16, 2026 and in compliance with regulatory requirements these results have been released to the stock changes with us.
You have had an opportunity to review the results. We now provide an update on the operations of the company, the subsidies and the joint ventures. As you can see, the performance in quarter three improved relative to the previous quarter of the current year but still lagged behind the comparable quarter of the previous year. The improvement is primarily on account of higher volumes and improved productivity. The pipe sector continued to see strong demand signals across both domestic and international markets.
The company sustained a healthy order backlog including significant projects for the water sector which provides strong visibility for growth potential. The pipe business reported a rise in its total order book volume reaching 19.64 lakh metric ton in December 25 as compared to 19.25 lakh metric ton in September 25. In Q2 we announced for securing an export contract to provide approximately six 22,000 metric ton of epsofites via Joburg arrangement for Saudi Arabia. Production of this contract commenced in quarter three.
Q3 of FY26 saw the start of production for our new seamless plant piercing bill, we are now stabilizing the production on this line. This enables a capacity increase to approximately 4 lakh ton per annum strengthening our ability to provide fast reliable services and for most of the product sizes. The water pipe business primary ductile continued to face challenges in Q3 despite a strong order backlog of over a year. Out of the total order backlog, total order book of pipes aggregating to approximately 19.64 lakh metric ton DI pipe order book is approximately 40% which includes exports and supplies under Jalpan mission as well.
Importantly, our overdue receivables from EPC customers working under Jal Jeevan Mission are approximately 350 crore only and majority of these are bandwide adequate security. While market demand remains strong. Business related to water pipes has been impacted significantly by protracted payment timelines in the Indian water sector. The lengthy receivable days associated with public infrastructure projects continue to pose a major challenge for supply chain stability. The company is navigating complex volatile geopolitical economic conditions including unanticipated tariffs and challenging water sector project implementations tramble in India.
By way of proactively strengthening our business resilience, we are taking decisive strategic actions such as optimizing our Indian product portfolio, rebalancing our sales mix to optimize export and domestic opportunities. Q3 demonstrated an improvement over Q2 of FY26. With green shoots emerging in both domestic and export markets, it appears Q2 marked the bottom of the cycle. We maintain a positive outlook on government initiatives particularly the upcoming Union budget where we anticipate continued support for the Jal Jeevan mission laying a strong foundation for future business growth.
We view current market conditions as transient, supported by our robust order book backlog, strong liquidity position and effective debt management. The company’s ample working capital line from banking system further ensures we can meet all operational requirements efficiently. Now let me address the financial highlights of Q3 and for 9 month period of FY26 on standalone basis, the company registered a total income of rupees 4157 crore representing a sequential increase over Q2 of FY26 which was 3409 crore.
But it declined against Q2 of Q3 of FY26 which was 4. 5503 crore EBITDA. For Q3, FY26 stood at rupees 527 crore showcasing a significant recovery from Q2 of FY26 which was rupees 335 crore though remaining lower than Q2 of FY25 which are 882 crore paired for Q3 for this year was reported at rupees 227 crore, significantly higher than Q2 of this year which was 79 crore, but it was still lower than the Q3 of FY25 which was 477 crore. On consolidated basis. Total income stood at rupees 4963 crore for the quarter which is for the current Q3 up from rupees 4264 crores sequentially which is quarter to quarter but is still down from rupees 5293 crore year.
On year basis. EBITDA improved sequentially to rupees 632 crore in Q3FY26 from rupees 482 crore rupees in Q2FY26 though it remained below rupees 961 crore reported in Q3 of FY25. Q3FY26 paid was rupees 248 crore up from rupees 139 crore in Q2FY26 but still down from rupees 479 crore in Q3 of FY25. And on debt side, as on 31st December 2025, the standalone net debt narrowed to rupees 3154 crore versus rupees 3310 crore as in 30th September 2025 which includes the long term debt of rupees 534 crore rupees only the balance is working capital debt on the consolidation side, the net institutional debt has reduced to rupees 3,346 crore as compared to rupees 3,856 crore as at 30th September 2025.
The long term institution debt is only rupees 690 crore. So after having discussed the financials and the prognosis for quarter three, let’s also talk about the operations of our subsidies and joint ventures in UAE entity which is Abu Dhabi, the Tai PI production plant. The entity maintained steady operations in Q3 of FY26, delivering approximately 52,000 metric ton of corrosion resistant ductile iron pipes compared to 58,000 metric ton in the previous quarter. As of 31st December 25th. The subsidiary holds a robust order book valued at approximately $235 million which is for 215,000 tons.
This ensures operational stability for next 9 to 12 months time. The backlog is independent of the parent company standalone order book which stands at approximately USD $1.48 billion. So if it’s aired it would be somewhere around $1.7 billion. Now you would note that Abu Dhabi entity is a premium supplier of ductile iron pipe to almost all the countries in MENA region. This is the only entity which produce highest the largest size pipes going up to 2.2 meter which no other entity in MENA region even India produces.
Now coming to Jindal Hunting. It’s a joint venture with Hunting Energy Services Private Limited Singapore in which Jindal saw holds controlling interest of 51%. This entity generated rupees 137.9 crore revenue and rupee 44 crore rupees of PET in nine months period endgit FY25 which is an increase from rupees 130.7 crore of revenue and rupees 38 crore of PET in the previous year. Now a snapshot about the Jindal ITF vs NTPC case. The initial arguments by Jindal ITF took place in January 26th in front of the double branch of Delhi High Court.
The hearing has now been fixed for 2nd February where NPPC will make the arguments. Now the updates on our new projects in GCC region. As you know like Jindathra maintains a domain position as a leading supplier of pipes to MENA region with the majority of our export volumes dedicated to this market. To ensure timely delivery and superior quality, we established the first ductile iron pipe facility in Abu Dhabi UAE which is now in operations for over a decade in response to MENA region countries incentivizing local manufacturing.
As part of their respective vision statements, the board of the company in prior meetings approved strategic investments to safeguard the market share. Key initiatives include establishing a wholly owned seamless pipe plant in Abu Dhabi alongside announcement of joint ventures for a sub pipe unit and a ductile pipe facility in Kingdom of Saudi Arabia with 51% ownership in both the projects. All these projects are expected to be commissioned in next 24 months approximately that is by February 28th and we can expect the impact on the financials from FY29.
Now let us appraise you about the developments in these entities with respect to seamless pipe plant in Abu Dhabi. The company Dindalsoi is expanding its Middle east footprint with a new seamless facility in Abu Dhabi Kijab Zone establishing through its step down subsidy named Jindal seamless Pipe Manufacturing LLC with initial UAG 20 million equity infusion. The land had been secured near the existing ductile RN pipe plant and the long lead equipments are being identified. Order placements have been initiated and the lease deed has been signed executed for the leasehold land.
Discussions are going on with banks for financial closure to serve the region’s requirement and it may be noted this leasehold land is a developed land. There was already an existing unit so we might save some time in terms of implementation of the seamless pipe project now the plant in Saudi Jindalsa Limited has established a joint venture with Buhur in the Kingdom of Saudi Arabia to develop a state of the art sub pipe manufacturing facility. It is 51% step down subsidiary and this entity makes a key strategy Expansion development is underway with lease agreements for the site being identified and finalized.
JV partners have infused initial equity for the Tile 5 facility in KSA. JV agreement has been signed by the partners. Other corporate actions are in process now. Before concluding the presentation, let me summarize. Having experienced a dip in the first two quarters, the business has gained momentum in quarter three and is poised for continued growth. To drive global market penetration, the company is intensifying export effort, building foundational demand for its upcoming expansion into the MENA region.
Our sales funnel is expanding resulting in a strong and growing order book with significant interest from global and local markets. Our long term debt structure remains highly sustainable featuring a stand on exposure of approximately 530c crores only. Notably 500 crore is attributable to the LIC backed NCD with a well staggered redemption schedule between 2028 and 2030. Trade, Finance and working capital are crucial for our day to day operations driven by production levels and market conditions.
We are dedicated to reducing debt costs and optimizing cash flow. We are committing capital expenditures across the majority of our Indian operations. This strategic spending is designed to enhance operational efficiencies, modernize assets, reinforce regulatory compliances and ensure our readiness for dynamic market conditions. Now before I conclude, I would say our efforts are focused on ensuring long term viability and transforming our structure to with stealth challenges. Thank you very much.
I now leave the floor open for interactive discussion. My colleagues Mr. Narendra Mantri and Mr. Rajiv Goel are with me to address any of the questions. Thank you very much.
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 two participants Are requested to use handset while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Sahlesh Raja from BNK Securities. Please go ahead.
Vikash Singh
Thank you. Congrats for the good set of numbers. Sir, in the last earnings call you indicated that seamless pipe production will ramp up to 90,000 tons per quarter in 4Q from current run rate of 40,000 tons given by the new piercing line. So given that macro condition in seamless pipe that is very weak. So could you explain the demand visibility and the order book that is giving you confidence in ramping up the capacity and how the second piercing line changes your ability to simultaneously cater both lower and higher Dior segments.
How the product mix will change. And also can you please talk about the exports opportunity here in the seamless which will help in increasing the utilization level.
Vinay Kumar Gupta
Okay, so let me address the question in such a fashion so that it becomes sequential. First let’s talk about the commissioning of the Piercing line. The piercing line offers the. Let’s say it improves the production capacity in the larger sizes. Now we are capable to almost all the sizes which improves our productivity as well as capability to deliver the product in time. Now in terms of let’s say the order, the visibility and all those things this. Is this specifically for India. Depends like how much tender the ONGC and other people are floating as of now we have visibility but we have visibility.
And there are few tenders which are likely to come. But the current order book is comparatively lower than the previous order book. Previous quarters order book. But we are expecting few tenders to come which will help us to increase production and sale of seamless pipe in let’s say next year. And now as I mentioned that we have improved our capability for providing the production time full range of products. This would help us in terms of market share as well as the overall productivity.
Vikash Singh
What kind of growth that you expect in FY27?
Vinay Kumar Gupta
What kind of growth?
Vikash Singh
Growth.
Vinay Kumar Gupta
Okay. So growth. Okay. I would say this way that subject to the business coming in the market we believe even if the business people or improvement. But somehow previously we were restrained for taking or participating in the business where we had capability restriction in terms of the site. So to that extent the growth will surely come. We. I mean how much growth really depend on the orders to win. But surely we will now we have capability to let it service the market with full productivity production range.
Vikash Singh
Okay. Okay, sir. Also can you provide the volume breakup we reported in 3Q? We have reported around 3.7 lakh tons. So can we give the breakup HRDI is seamless also, given that DI demand remains challenging. As you highlighted in the opening remarks. Could you share the current. I missed it. Could you please share the current DA order backlog? Both domestic and exports mix. And also what are the steps that we are taking to de risk dependence on domestic demand and through exports or any other opportunities there to improve the DA pipes volumes?
Vinay Kumar Gupta
Okay, so as we mentioned that we have a total order book of. In the pipe we have a total order book of 19.64 lakh ton. Okay. This is the total order book. In this total order book we also mentioned that the tile. The tile comprise of 40% of this. Which is. Which works out to reflect roughly 7 to 7 lakh 50,000 tons. And which is in this. In this the. The total. I would just because the tile remains important for all the total order book in terms of ductile around 560, $570 million in which roughly $45 million is export.
Okay, so eventually if I. If I say. Let’s say in a year ago we were not focusing so much on the export market for ductile from India. Primarily we used to service it only from Abu Dhabi. Now we have started looking any export potential which we were earlier ignoring because the domestic market was very tried to cover in our purchase that we want to now let’s say strategically we want to see that if the domestic market continues or struggle, we should have export potential in the ductile or above the Abu Dhabi facility also.
So this gives you some indication that today we have roughly $45 million export order and we are creating capability because in ductile for export you need to let’s say do extra effort in terms of creating your production line. And for also for letter logic, all those things are being done and hopefully maybe in next 1-2-4 time we would increase our exposure from India irrespective of the domestic market.
Vikash Singh
Okay. Okay. Okay. That is great. Sir, one last question. In the standalone, you know last year we reported around 17 lakhs. With the seamless capacity addition. What could be our peak achievable volume number in pipes only in India. I’m asking also our graph profit to EBITDA conversion last quarter it was 25%. You said there will be improvement. It has increased to 30% in pre q as you guided. So our peak conversion rate gross profit to EBITDA it was around 40%. We reported in FA25. So how do you see the trend in the coming quarters?
Because what are the efforts that you have taken in di, COCO and facility to reduce the conversion cost that is not fully reflecting because of lower scale in di. So is there any other. So now you’re saying volume will improve in di. Is there any other measures that we are taking to reduce the conversion cost and fixed cost to improve our EBITDA margin by when do you see our EBITDA margin crossing 15 percentage plus without other income? I’m asking last quarter. It is 2024.
Vinay Kumar Gupta
Yeah, I appreciate your question. See this is a period when the things got distorted. Okay. We were. We were doing very well. If I can see. Our EBITDA was in the vicinity of 19 to 20% in December 2024 which came down to 12.7% in 2000 December 25th. Now there are a lot of factors which had actually contributed to this negative growth negative number by almost 6 to 7%. So
Vikash Singh
The
Vinay Kumar Gupta
Correction. And let me give you a high level pointers instead of going into let’s say which process will contribute more or what cost containment can happen. Number one that the company has as you know like if you’re tracking the company. Company has a capability to produce at various locations. We have done I think 1.1.7 1.8 million ton in previous year. We can without increasing additional capacity. So I’m not saying be body making. You know let’s say I’m not. If. Let’s say if I’m not putting any new plant of any of the product we can easily go to letter 2.2 million ton.
Okay.
Vikash Singh
This is including seamless catastry are excluding.
Vinay Kumar Gupta
We are talking about now. Well while sitting in January we are including everything. So saying is that it might not happen next year because the situation. Yeah. Okay. So in terms of. Let’s say can we produce. Can. Can we demonstrate that we can go to. To what level we can go. We believe that we can go to 2.2 million ton without adding additional. Any additional production line or whatever. And if you are producing it that level the productivity improves, the cost already comes down and whatever measures we have taken in last so many time and we are doing in terms of debottle lacking cost cutting, efficiency improvement, modernization, all that contributes.
Both problems come when you are not using your facility in an optimum way because of whatever reason in summarized form we dropped from 19.5% to let’s say 10% in September 25th and there is an uptick 300 basis point in the current quarter. This will be a slow journey because we are in a business where we are Even though we are not supplying directly to government but we are in the business supplying, it’s a business to government through the EPC. And all will be transient period. But we are hopeful and let’s wait for first of the February.
If everything works well, the situation start improving for a while then we can also tell you like how much improvement has come on account of production, productivity, cost improvement, all those things.
Vikash Singh
Okay. Okay sir. Okay sir. Thank you sir. And I wish you all the best.
Operator
Thank you. The next question is from the line of Shweta Dixon from Systematics group. Please go ahead.
Ashwatha Dixit
Hi. Good evening sir. Am I audible?
Vinay Kumar Gupta
Yeah.
Ashwatha Dixit
Hi. So the first question, just to get your qualitative view on what’s happening in the Jaljeeban mission. What are the expectations here on. Because recent, recent news indicates that there had been some monitoring of on ground developments that have been there to basically understand where the gap, where the gaps have been. So from here what’s your view on revival of government spend for this, for the project and what are the expectations from the budget as well? Do we see, are we likely to see a sharp, sharp decline in budget allocation for the scheme?
And secondly what is the run rate that we are targeting from the seamless pipe unit on a quarterly basis from 4Q onwards.
Vinay Kumar Gupta
So to answer the. Answer the first question, Shweta, I think whatever you are reading, we are also reading the same, the same newspaper. We read what we read. That’s number one. Number two, I think let’s not hazard in guessing what the government is likely to announce in the budget. It’s now additional another 10 days time or 12 days time. Whatever it is the 1st of February, wait for that. Because once the budget announcement is done because the industry or the chamber they, they represent to the government, they make their noises and all what it’s very difficult to let say project what they are thinking, what they want to do.
But at least the good thing is that they started buzzing. They have even though they have cut down the 67,000 code to 17,004 but at least 17,004 is likely to be disbursed in some time, couple of months. And it is important to see that what they want to, what they would announce on 1st of February in terms of whether the scheme is. The scheme period is getting extended. What is the amount? I would say, let’s say I’m speculating out of 67,000 crore. 17,000 crore. They have now said like they will disperse even if they would confirm 50,000 crore education for the next year.
That’s a Very welcoming statement Means now even if it’s lot of monitoring and control and all those things, they would, but still they would release the money and the circulation, the whole supply chain which has virtually stopped for the jail June mission will start. So that is a. That is my response to the question. Number one, in terms of seamlessly seamless, basically we are not creator of demand, we respond to demand. So we always try to see that what are the business potential in domestic market and export market as far as the seamless is concerned.
Since we are talking seamless. One of the market for Indian seamless producers, export market for Indian seamless producers is us along with that is Canada. We don’t service the Middle east from here, from India and we are still supplying to us despite the tariffs. Means like India is competitive and we are still exporting to us. Now it has to be seen that how much US will budge. And our people are now trying to, let’s say explore other export markets as well. We are also because we are setting up the seamless pipe wheel in Mena region.
We are trying to, let’s say next door opportunities for supplying there also. So that by the time we are in production, we are already present there. Because so far the market was good in India and us. We were focusing on that. But the only thing what I can say, I don’t know how much we will produce because it will be as I said that we respond to demand instead of creating demand. But we are capable to produce, we are capable to supply. Putting a number to this is a guess.
Ashwatha Dixit
Understood, sir. Thank you. Next question from my side would be when mentioned something in your opening remarks that the implementation of seamless pipe unit in Abu Dhabi could take lower than expected time. I missed your full remark on that. Could you just explain that to me again?
Vinay Kumar Gupta
Yeah. So basically, as you know, like in any, any part of the world, if you are setting up a greenfield project, the first important thing is that land and at lot of places the lands are not developed and it takes considerable amount of time and cost to develop that land. For example, there are, let’s say you have to fill the land or whatever you have to do eventually. Fortunately, the leasehold land, what we have signed with Kaza, which is a local authority, land authority and all on this plot of land there was already a manufacturing facility which manufacturing facility further moved out.
They perhaps went into bankruptcy, whatever and there are some shortage, some sort of structure is also built in and we could get this land through auction. And along with the, along with the structure, this saves some Time we need not to do the development on this land. In terms of filling the land or doing whatever there is a boundary is already available. There’s some not hundred percent shared is available. But even a good amount quantity of shared is available. This gives a. This will reduce some of the implementation time.
We are already. Because we are already a seamless pipe producer. We know like what equipment will have to go, who will supply and all our teams are already in constant discussion and negotiations for those we have inducted $20 million equity in the company for payment of the land and also for making some advances payment to the equipment. So we believe that we are in advanced phase of initiation of the project which gives us confidence that we can complete this project let’s say within two years time.
Ashwatha Dixit
Understood, sir. So my last question of the 370,000 tons that we’ve done in India this quarter, what would be the proportion of DI price? I’m just trying to understand when you say that the order backlog is more than one year, what could be the oldest order that has been lying in the order book but still not meeting execution.
Vinay Kumar Gupta
I would. Because we don’t give the product wise, let’s say the pipe wise breakup. But I would say that ductile sale in this quarter is comparatively higher than the Q2. That’s one. Secondly, in terms of the backlog we have already sounded that we have backlog of almost one year which is 40% of the total order book. And you can calculate it’s at least 7 like 50,000 ton of order. We still have which has roughly $45 million of orders on the export side. And this has reasonable amount of the products, the orders from the APC contractors which are backed by jjm.
And now the good. I mean if you are tracking the sector, there are state governments which are. The center has asked state to start working, initiating, initiate their own fund arrangement and start giving the orders. So now couple of business opportunities are coming, a couple of businesses are coming which are not backed by JJM where the funding is being organized by state and will be given by them without going to the central government. So all those things are coming and we expect to get our proportionate share from the new business opportunities which are not backed by jgm.
And on the top of that if the JGM issues got sorted out this order book execution will be much faster.
Ashwatha Dixit
Understood sir. Thank you so much for your time and good luck.
Vinay Kumar Gupta
Thank you.
Operator
Thank you. The next question is from the line of Abhishek Maheshwari from Skybridge Funds Manager llp. Please go ahead.
Abhishek Maheshwari
Hi, thank you for taking my questions and many congratulations for good numbers, sir. I was pleased to see that the data’s turnover has improved this quarter compared to the previous quarter. So are we starting to see receivable days come down again? And was this primarily due to saw pipes and the job work order or are we seeing improvement in DI pipes also? I’ll get to my second question after your first answer.
Vinay Kumar Gupta
Okay, so Abhishek, thanks for the question. Eventually. This is a routine thing. Eventually. See, we do export, we do import, our exports are 30%. Sometimes the retention monies and some money gets stuck because of retention or contractual event. And that’s where it gets reflected in the receivers we have received the retention monies or money which was stuck as a usual process. So that is, and if you remember, if you see that we have said in our preface that trade finance is integral part of the pipe business.
The only thing, what we can do is optimize, improvise the system, reduce the cost. It can, I don’t think it can come down to almost zero unless we are doing the business only against advances. But it’s a process. We constantly keep doing efforts in terms of collections, in terms of securitization and all those things. But yes, there is improvement. And unfortunately the ductile business is not being done in the way it should have been done. We have capability, capacity. So if we are selling lesser pipe, the old lytization is coming and the new realization we are trying to secure so that it is not going into the overdue capacity bucket.
So that’s what it is.
Abhishek Maheshwari
So thank you for that. Second, second question is regarding the follow up of first only. So you have a very healthy DI order book backlog. And now we are dependent on the EPC players to, you know, kind of do the, you know, call for the pipes. And then the APC is dependent on government to release payments. So is it that your machinery in DI is now stuck because of your order backlog or can you take new export orders or new. Because you know, just wanted to understand if you’ll be able to take new orders and execute them or you are stuck with these backlogs.
Vinay Kumar Gupta
So, okay, so let’s put it this way. This is how the business is done globally. The ductile business globally done through EPC contractors. If I am exporting, I’m also exporting only to the DPC contractors. This is how it’s not unique to India. It’s a global. That’s one India was doing very well for last 15, 20 years in terms of the, let’s say the water business, whether this administration or even the previous administration, the focus on the urbanization and the water was very prominent. It somehow like it goes jammed because of XYZ reason which is known to everyone that’s getting delayed.
If you ask with a perspective, we don’t think that there is a dead end. We think it was a pause and it was, it may be good for future, it may be good for governance and everything. And once it is reset, the things might be done in a much faster way. Now coming to your second question that primarily you are saying do we have alternate market in terms of whether we can do domestic, more domestic, more exports, which export market and all. Now we are the only supplier as of now from India who has manufacturing facility in India and Middle East.
Of course now our peer group company is also going global. They are setting up the plant in ksa. So effectively the whole process we mentioned also that whole process of setting up a ductile, ductile iron pipe plant in Abu Dhabi way back in 2012, 13, 14 is to cater to the MENA region growing market from the backyard of MENA region which is like supply anywhere in the MENA region from UAE or Abu Dhabi. Now having said that Indian market was growing very definitely and a testimony to that is that India which had only two or three producer of ductile pipe, now they have more than half a dozen ductile players.
The capacity is more than 4 million ton which used to be a million ton. So the capacity of so much of capacity will come and there is a demand. So it’s a ration. The things will correct. We have to give some time and hopefully every player will do better. And till that time you have to be adaptable to the changes and make the change in your strategy. And the change in the strategy is while we were not looking at the export market vigorously because the domestic market, we were not able to service domestic market efficiently because of the high demand.
Now we are looking to the exports also. So we don’t want this to be a permanent issue. For that we have suffered for some time. For example, if we have capacity of let’s say close to 7 lakh ton, which so we can do, let’s say close to 160, 170, 180,000 ton per quarter. We are reduced to Roughly, let’s say 1 lakh. 1 lakh, 25,000 ton per quarter. But do you want to stay here? No, we have three blast furnace. So we are working over time. We are adapting to the Changes we are working on the strategy that how to take it forward from here, how to, let’s say run all the machines, how to, let’s increase the production and productivity.
Abhishek Maheshwari
Okay, thank you so much for that. Thank you.
Operator
Thank you. The next question is from the line of Deepak Podar from Sapphire Capital. Please go ahead.
Deepak Podar
Yeah, I’m audible, sir.
Vinay Kumar Gupta
Yeah, you’re audible. Thank you very much.
Deepak Podar
Yep, thank you very much sir for this opportunity and many congratulations for a good set of numbers. So just wanted to understand first up on the interest cost, I mean we have been seeing a decline in our interest cost since last two quarters. So how should one look at going forward and what was the reason of the decline?
Vinay Kumar Gupta
So basically the hybrid interest cost remains the same. The absolute amount is marginally low, primarily because of. Can you hear me? I think there’s some disturbance.
Deepak Podar
No, I can hear you, sir.
Vinay Kumar Gupta
Okay, so the utilization has come down. Overall business last year is bit low. So it’s echo of my own voice. So if you can, if you can hear me sir, let me continue because I can, I can hear my voice. So it is the interest cost. If I was the rate of interest, rate of interest, it remains the same. But the absolute number has come down for 2 billion. Number one, lesser utilization. And number two is some negotiation of the cost on account of let’s say the instrument, which is letter of credit, bank guarantee on this.
But otherwise broadly the interest rate absolute, I mean the. Every percentage of my interest cost is broadly the same. Long term debt has come down. It is now in the vicinity of only.
Deepak Podar
Okay, okay. How should one see it going forward?
Vinay Kumar Gupta
So I think if the volume increases, let’s put it this, as I said that it is a working, it is a trade finance dependent business. If the volume increases and hopefully volume should increase. Let’s say if you go from here to 2.2 million ton in next two years time, the working capital intensity would increase a bit. The cost would also increase. So this has to be seen in relation to the top line as well.
Deepak Podar
Okay, okay. So ideally when your top line increases, your interest cost will also kind of see a jump.
Vinay Kumar Gupta
Yeah, but percentage wise it will come down. Percentage percent interest, net cost to top line will come down.
Deepak Podar
Understood, understood. And my second question is on your, I mean in the previous call as well, I think you did mention that third quarter you expect to be better than second quarter and four by fourth quarter you expect things to normalize. Now we, we have seen the, I mean improvement in third quarter. So, so I mean normalization in fourth Quarter is what we are looking at.
Vinay Kumar Gupta
No, no. So normalization doesn’t mean that what we did in the last year, which is 24, 25, because normalization means the situation will start improving. So we don’t say and we don’t expect that we will reach to 20% in next quarter. What we expect in any case is always better than the third quarter. But fourth quarter is likely to be comparatively better than the third quarter.
Deepak Podar
So fourth quarter, we expect to be better than the third quarter. Right,
Vinay Kumar Gupta
Correct.
Deepak Podar
Okay. And in terms of margins also, I mean you did mention, I mean I think one of the participants did ask about whether we can have a 15% EBITDA margin. I mean, is there any timeline, I mean when we can come back to our previous, I mean high margins in terms of 15 to 17%. How should one look at that going forward?
Vinay Kumar Gupta
We would love to do 25% margin.
Deepak Podar
I’m saying 15 to 17%. Yeah,
Vinay Kumar Gupta
I said we would love to do 25% margin. The only challenge is because as we said that we don’t create demand. We respond to demand. We respond to the situation. For example. And you would seeing this across the industries and across the players in the five sector also we are one of those players who have multiple product, multiple location, multiple markets. We are still surviving. We are doing better than couple of others. But yes, effort always remain to do better than the previous. But these kind of scenarios which you are, which you also know like the global geopolitical issues and the domestic issues specifically related to Jaljeevan Vishen this derailed the whole thing.
If this would not have happened, presume that the water business continued as it was doing, perhaps we would not have gone down to this level. We would be continuing from our what we were doing last year. So eventually, eventually the cycle has somehow it has taken a pause from here here to take the momentum. It will take some time and as the previous question was there that we have to see that how the government respond, how the government opens up what they say in the budget if they don’t address this issue.
We have a challenge. We have to then look for other options.
Deepak Podar
We are basically
Vinay Kumar Gupta
Talking optimism, we are talking everything optimistically that everything will work well. The government will also do positive that they will start sending the checks to the APC contractors and all. But I think the 2nd of February will be very important for all of us, especially the pipe sector companies doing ductile pipe.
Deepak Podar
And what is our export revenue share.
Vinay Kumar Gupta
In general? In totality it is 30%.
Deepak Podar
30%. Okay, okay, okay. I Think that would be from my side. Wish you all the way best. Thank you.
Vinay Kumar Gupta
Thank you very much.
Operator
Thank you. The next question is from the line of Rajesh Agarwal from Maneer. Please go ahead.
Rajesh Agarwal
Hello sir. My question is on volume growth. Suppose last quarter whatever order we had, we had the same order and we have executed around 5,000 crore. This means this quarter we got an. Order for 5,000 crore.
Unidentified Participant
Yeah. So this time also if you see. The order book is a little bit on an upside basis like we had earlier 1.45. Now this is $1.48 billion. So in terms of numbers and also the exhibition is on the higher side. So if you combine both the numbers the orders are much higher than the previous quarters.
Rajesh Agarwal
Okay. So this unit and the momentum will be maintained. Your outlook on that?
Unidentified Participant
Yeah, we expect that because the field funnel is strong. So there is a large inquiry from overseas as well as domestic. So this momentum seems to be continued.
Rajesh Agarwal
So next year we can expect on a volume growth 15, 20 volume growth.
Unidentified Participant
So we can’t comment on the percentage but yes, definitely the volume we are expecting continuing given the circumstances. Conditions are improving.
Rajesh Agarwal
Okay. And then then there’s a scope of operating leverage. Margin improvement can also happen next year.
Unidentified Participant
That that should be again the our expectation that should happen.
Rajesh Agarwal
Okay. And so the job of order is at good margin. No.
Unidentified Participant
So job work order is as we earlier mentioned that we always protect our per turn margins based on the production capacity. So that is very much in line of that.
Rajesh Agarwal
Okay. And so any feedback from government about the jelly given machine money which has got struck any.
Unidentified Participant
So that is something which we earlier mentioned in the call that whatever there is in the news about the JJAM and J1 mission schemes hearing the same. We expect that there will be some positive news in the upcoming budget and be normalized in the coming year. Budget
Rajesh Agarwal
Has not been issue. See a government provided last year there an increase but there’s some corruption. Then it went to the pmo. So in not update on that because it is not because of the budget. It is because of the corruption at the state level. And I think I read an article case the matter is pending at the pmo. So the PMO has to take a decision on releasing money or whatever. So you are right,
Unidentified Participant
Right. That there was a certain news about this leakages and all what we are envisaging that the budget allocation is. They keep the budget allocation at the same level what they did in the last year positive about JJM scheme per se. And there is no negativity in the Comment after all that and all the news coming in in the public domain. Okay.
Rajesh Agarwal
And the ground report is what There are still a requirement also 70, 80 work is done. So the requirement is there still for. The dip
Unidentified Participant
So that that you can actually very well expect that over orders order book remains same. There is no cancellation orders in in the JJM scheme bag orders. So that is continued if there is no cancellation per se. Apart from this, the new demand which me has mentioned that is coming from the state government side they are not depending on the central government ad under this scheme. So there are multiple having seen which are opening up and if the things are going well with JAM scheme it will be an add on business as far as industry is concerned.
Rajesh Agarwal
So going forward what will be our export component then? Export component? We are focusing more on export now because of the local issue. So export component will also increase.
Unidentified Participant
Yeah, that is our strategy that we should increase the export component in DI sector earlier it was minimal less than 5%. Now it is increasing and our focus would be to maintain that export or export portfolio little bit large so that we are not depending on domestic market.
Rajesh Agarwal
So all DI pipes export orders are from Middle East?
Unidentified Participant
Yes, largely.
Rajesh Agarwal
Okay, thank you sir. These are my questions.
Operator
Thank you. The next question is from the line of Darshan Gangar from First Water Capital. Please go ahead.
Darshan Gangar
Yeah, good evening sir. Thank you for the opportunity. So with respect to the DI segment just wanted some sense on the EBITDA per ton. So the broad understanding was that they have corrected from an high of 18 to 20,000 per ton to 8 to 10,000 in 2Q so what would be the range for third quarter or the current situation?
Unidentified Participant
So that’s in generally we don’t discuss product wise margins in our cost because that is a policy company is adopting. But you are right there is a compression on the margins because now the market is different. Earlier it was supplier market where the supplies were short and demand was high. Now because of the you know stoppage in the JGM scheme fund release situation is reversed now the supplies are higher and the demand is low so there is a compression in the on the margin in BI sector But product wise margins we are not discussing.
Darshan Gangar
Okay, my second question is like you know given the moderation in crude price and the benign outlook on crude going forward so is there any impact on visibility of the oil and gas capex happening in the region like which might impact our future capex?
Unidentified Participant
So in oil and gas sector generally what we have seen that the volatility in the oil prices on a shorter short term basis it is not impacting the demand where the projects are based on the multiple years projection. So generally the demand is. And again the oil and gas sector is for transportation mode until unless there is a reduction in the consumption of oil and gas, we don’t foresee any issues in terms of consistent demand in the sector. So short term price volatility in the oil sector generally it is not hampering the demand.
Operator
Thank you ladies and gentlemen. Due to time constraint. That was the last question for today. I now hand the conference over to the management for closing comments. Thank you. And over to the management.
Vinay Kumar Gupta
Yeah. Thank you very much. And on behalf of my colleagues and the manager of General Saw Ltd. We place our appreciation to ICC Direct and all the participants of this call. And we hope that things will look better. We hope the budget would be positive and we would have lesser questions on ductide RN pipe next time. Look forward to meet you again in the next call. Thank you very much.
Operator
Thank you on behalf of Jindal SA limited that concludes this conference. Thank you all for joining us today. And you may now disconnect your