SG Mart Ltd (NSE: KRL) Q3 2026 Earnings Call dated Jan. 23, 2026
Corporate Participants:
Anubhav Gupta — Group Chief Strategy Officer
Archit Arora — Vice President, Sales and Marketing
Unidentified Speaker
Analysts:
Vivek Patel — Analyst
Rahul Kumar — Analyst
Aman Soni — Analyst
Vishal Mehta — Analyst
Rajiv Bhatt — Analyst
Vikas Mistry — Analyst
Presentation:
Operator
Ladies and gentlemen, good day, and welcome to SG Mart Limited Q3 FY ’26 Earnings Call hosted by Motilal Oswal Financial Services Limited. We are pleased to welcome the management of SG Mart. [Operator Instructions] Please note that this conference is being recorded.
I now hand the conference over to Mr. Anubhav Gupta from SG Mart Limited. Thank you, and over to you, sir.
Anubhav Gupta — Group Chief Strategy Officer
Thanks to Motilal Oswal for hosting SG Mart for its quarter three FY ’26 earnings call, and I welcome all the participants who have joined. I’m accompanied by my colleagues, Mr. Suraj Kumar, the CFO; Mr. Amit Thakur, Director; Mr. Archit Arora, Leader, Service Center Business; Ms. Anamika Gulati, Leader – Renewable Business; and Mr. Naman Rastogi, General Manager, Strategy.
If you look at the third quarter, the tough environment persisted in third quarter with the decline in steel prices and softness in the demand, though the financial performance is below expectations, but we are not disappointed with our business performance. If you look at our third quarter revenue, the sales volume has increased 9% quarter-on-quarter. So both B2B metal trading and renewable structure businesses are ramping up.
We are not scared of INR17 crore EBITDA, which we reported for the third quarter because the actual business EBITDA was INR40 crores for the third quarter. Because of the softness in steel prices, there was inventory loss of around INR20 crores as we carry 20, 25 days of inventory, and there was sharp correction in the steel prices to the tune of INR2,500 to INR3,000 per ton. And plus there are minor INR2 crores, INR3 crores of business expenses, which we incurred to build the renewable structure and open profile business. I’ll talk about it shortly about it.
So it is important to understand that how we are at INR40 crores of quarterly EBITDA at business level and how we are going to take this to INR60 crores in quarter four and eventually to INR80 crores, INR85 crores quarterly run rate in FY ’27. So we will give you the clear picture that how we are achieving INR40 crores in the current quarter, like which went by quarter three, how we’re going to increase it by 50% in quarter four and how it’s going to further increase to INR80 crores, INR85 crores quarterly run rate in FY ’27.
So there are like four businesses on which SG Mart is standing today, four pillars. Number one pillar is the service center business, wherein we have four operational service centers in India and one in Dubai. Five new service centers will be operational in FY ’27. And we have already started identifying 10 more locations for which the land acquisition work has started. So by end of FY ’28, early FY ’29, we shall have all 20 service centers up and running. So — and over here, we are offering three products services. Number one is stock and sell of HR coil. Number two is cut to length metal sheet. And number third is embossed specialized chequered sheets for various industrial uses.
So service center business, if you see quarter three, we did around 163,000 tons in total with 50,000 tons of monthly run rate, 50,000, 55,000, which is coming per service center. Now in quarter three, the EBITDA was slightly lower at around INR1,500 per ton. In general, we make INR2,000 per ton. But here, the spreads were lower by INR500 per ton because the market was on the declining side in terms of raw material prices. So there was some pressure on sales and lack of demand. So we had to offer some discounts to our customer.
But in quarter four, the revenue will be similar because the new service centers will start contributing from Q1, Q2 of FY ’27. So quarter four, the volume will remain same around 160,000 tons, but the EBITDA spread will improve to INR2,000 per ton, which is the real margin for the business.
Then the second business is the B2B metal trading. In B2B metal trading, we did around 125,000 tons of volume, in quarter three. In quarter four, we expect similar volumes. And of course, the EBITDA spreads will improve here as well. In quarter three, the EBITDA spread was around INR500, INR600 range. Again, because of declining steel prices, there was pressure on sales, lack of demand. So since the steel price correction has got arrested, so the business will make real spreads of INR900 to INR1,000 per ton. So these two businesses, the volume will remain flattish in Q4, but EBITDA spreads will improve sequentially, which will improve the overall profitability for these two businesses.
The third business is the renewable structures. The solar structures, what we are selling to IPPs and OEM customers in India. So in quarter three, we did around 17,000 tons of sales volume. In quarter four, based on the current order book, we will be doing around 25,000 tons for Q3. And EBITDA spread, of course, it was a bit lower in third quarter because the business is ramping up. So now all the costs got incurred already. So the EBITDA spreads will be to the tune of around INR4,000 per ton.
We have a healthy order book here. And now we are in panel with almost 20, 25 large OEM and IPPs in the country. So this business will continue to grow quarter-on-quarter. The fourth business, which is part of the structures only, wherein like we wanted to start open sections starting from structure for residential rooftop, then cable trays for construction and purlins and racking structures. So we have identified all these products, the capacities are being built up.
And we launched one structure for residential rooftop in end of Jan. And the result has been so encouraging because these products are being sold through our group distribution network. So a lot of strength we are getting because it is selling under APL Apollo brand with strong margins as well. So quarter three, there was no volume from sale of these structures through trade route. But in quarter three — sorry, in quarter four, we are expecting 10,000 ton of volume from these products.
So Q4 — and we are making around INR6,000, INR7,000 per ton here because of brand premium. So if you multiply these four business segments, the revenue volume, which I explained and multiply it with EBITDA per ton, we come around INR60 crores of EBITDA — business EBITDA in Q4. And now we don’t expect any steel price correction. In fact, there has been some price increase only in month of Jan. So let’s see how Feb and March pan out. If trend remains upward, there could be some reversal of inventory losses which we incurred in Q3 that will be over and above INR60 crores of business EBITDA, but we don’t want to like — we do not want to comment on that. But we are very confident that our business EBITDA of INR40 crores in Q3 will go up to INR60 crores of business EBITDA in Q4.
Now let me explain how we are looking at FY ’27. So FY ’27, the service centers, five operational, and we will get volume from two, three service centers, which will start in H1 of FY ’27. So the five locations where we are putting up are number one is Punjab, number two is Jaipur, number three is Kolkata, number four is Indore and number five is Ahmedabad. I mean Jaipur will start firstly, followed by Punjab, Indore, Ahmedabad also, I mean, work is on track. And Calcutta, we shall be starting by end of FY ’27.
So overall, we may get around 750,000 tons of full year volume from service centers. And assuming INR2,000 per ton EBITDA, which we are generating, we will get INR150 crores EBITDA from the service centers. Then we have Dubai Service Center, which is generating around INR10 crores, INR12 crores of EBITDA on a monthly basis. We do around — sorry, we do around 15,000 tons of monthly volume with superior spreads versus what we get in India. So we will get around INR50 crores for the full year. We get INR10 crores, INR12 crores per quarter. So this translates to INR50 crores for the full year from the Dubai Service Center. So the total service center business will give us INR200 crores of EBITDA.
Then the B2B metal trading business, we’ll see like assuming the minimum volume depending on how steel supply shapes up, although we are quite positive as more and more steel supply is coming up, but this is something where we are dependent on the steel supply. So we are not giving aggressive guidance here. We are being very, very conservative. So we are taking the same run rate what we are doing 125,000 tons per quarter. So full year will be 500,000 tons. And here, the EBITDA spread will be 800, 900. So INR50 crores will come from B2B business, B2B metal trading business.
Then we come to solar structures and the other structures what we are selling. So all in all, we have developed 250,000 tons of annual capacity for solar structures and 250,000 tons capacity for the other structures, which we will sell through trade channel. So total, it will be 0.5 million tons, 500,000 tons of annual capacity. For solar structures, we have assumed volume of around 180,000 tons for full year, which means run rate of 13,000, 14,000 tons per month, which we are confident of. And the profiles for the trade, the multiple, other products for the trade segment here, we will do around 200,000 tons. So put together, we will be around 350,000 to 400,000 tons of structures with EBITDA of around INR4,000 to INR5,000 per ton, which can give another INR120 crores to INR150 crores EBITDA. So all in all, our business plan for FY ’27 stands at around INR350 crores plus EBITDA.
And I mean the only risk to these numbers could be, again, a sharp correction in the steel prices, which has been continuing for last two years. But at the level the steel prices have come, we don’t expect it to hurt our P&L. Plus what has happened is that our absolute EBITDA — so now Q4, we do INR60 crores of business EBITDA. So we shall close FY ’26 with around INR140 crores of full year EBITDA versus INR103 crores last year, FY ’25. So still, we are talking about 35%, 40% jump in absolute EBITDA. And when this INR140 crores becomes INR350 crores, so the impact from the steel prices also keeps on reducing.
We saw this in journey of our — another group company, APL Apollo Steel Pipes that when the EBITDA used to be small at absolute level, the steel prices fluctuation used to hit its P&L. But now that the absolute EBITDA is becoming a big number, then steel price fluctuation doesn’t hit the P&L very badly. So we are confident that no matter how steel prices behave, unless there is like 15%, 20% crash, we should be able to achieve INR350 crores plus EBITDA for FY ’27.
In terms of balance sheet, you see that the working capital days stood at 27 as at December 31, 2025. This was slightly higher because of the advanced payments we made to steel suppliers ahead of the imposition of antidumping duty on steel. So we just wanted to kind of book some steel because some destocking takes place. So we made some advanced payments to the steel suppliers. So by March, it will be better than 27 days what we reported.
So we continue to maintain 50% earnings CAGR which is our long-term guidance, right? Although FY ’26 was badly hit in the first nine months, still we will be delivering a 40% kind of EBITDA growth. And fingers crossed, FY ’27, there could be like 100% jump with the business model, which I explained, where we don’t see much of a challenge because it’s been two and a half years the company got into existence. Now we have everything ready to take off all the systems, capacities, team, everything is in place. So with all the confidence and conviction, we are talking about these financial numbers.
That’s all from our side. Happy to take questions now.
Questions and Answers:
Operator
Thank you very much. We will now begin the question-and-answer session. [Operator Instructions]. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Vivek Patel from Ficom Family Office. Please go ahead.
Vivek Patel
Very good afternoon. Am I audible?
Operator
Yes you are audible.
Vivek Patel
Thanks a lot for the opportunity sir. I just wanted to understand from Mr. Archit Arora and obviously, Anubhav sir as well as to, firstly, the Jaipur service center, if I’m not wrong, was expected to become operational in Q4. And also — so what caused — what is probably causing the delay, as you mentioned that you are planning to open the same in FY ’27?
And broadly, what are the key challenges that is faced by the company in expansion of service center as well, although the company has ample cash on the books, I believe INR880 crores, INR900 crores as of December. And also, as you mentioned, there are locations which are scouted through the country as well. I’ll be very thankful if you could expand on that.
Anubhav Gupta
Yeah. So just to answer the question on some delay on Jaipur operations beginning in quarter four. So it is just delayed by a couple of months because of excessive rain in that area. The rains lasted up to November. So civil work was impacted for a couple of months. Now it is back on track, and we should be able to start operations by mid of March.
Archit Arora
And to answer on like the ability to be aggressive on the service centers, see, I mean, like I said, now we have 20 service center locations on hand in India, plus one in Dubai. Four are operational, five work has started already. The other sites, I can name like Chennai, Hyderabad, Coimbatore, Hubli, Kolapur, Kanpur, Ranchi, Vizag, Patna, Siliguri, Guwahati, Bhubaneswar in Odisha. All these sites, we have activated the land acquisition process. And maybe in one, two more quarters, you will see — we will keep updating you that we have locked sites at these locations and the work has started.
So see, I mean, it took us like three, four quarters to get convinced that, yeah, I mean, we can easily do 8,000, 9,000 ton of monthly volume from each service center, right, with INR2,000 per ton of EBITDA so that we get desired ROCE of 25%, 30%. Now it’s been like three, four quarters, consistent three, four quarters that we have achieved this. So it gives us a lot of confidence and conviction that now we have to become aggressive and go all out. So January 2026 is that month where we have taken a call that now we’ll go all out, and we want to establish these 20-plus one service centers as soon as possible.
Vivek Patel
Understood, Thank you for that. Nextly, EBITDA per ton as you have mentioned over the quarters. So FY ’25 EBITDA per ton was slightly above INR900 and for these nine months, it stood at slightly above INR1,000. So based on your plans of expansion of service centers and also increasing share of renewables over the next few quarters, how do you expect this number, EBITDA per ton to change over the next, say, two years, FY ’27, ’28?
Anubhav Gupta
So I think, I mean, one should not look at the blended EBITDA per ton, okay? What one should look at is that how each business vertical is performing. Although I mean, it may appear like around INR1,800, INR1,900 per ton, okay, on blended basis. But there is a lot of scope to increase margins in the renewable structures and the other profile structures because once you start doing some of the like backward integration, you can get a lot of the margins from quoting process, right?
So I think we are very clear that B2B business should be generating INR1,000 per ton. Service center business in India should be generating INR2,000 per ton. Service center business in Dubai should be generating INR5,000 per ton plus, then the solar OEM business should be generating INR3,000 to INR5,000 per ton. And the profile business, which is trade-led sales, that should generate upward of INR5,000, INR6,000 per ton. So we are very clear on this.
And each business vertical has its own working capital requirement. So each business vertical will throw its own ROCE, right? So we are not too much concerned that what will be the EBITDA per ton on a blended basis, rather, what we look at is what will be the ROCE for the overall company, ROCE at the overall company level.
Vivek Patel
Understood. And last question I had was on the financials. So the short-term borrowings have reduced drastically from, I think, about INR700 crores in FY ’25 to INR130 crores now in December. While the interest cost has stayed in the range of INR12 crores in quarter one and two and now it has increased to INR17 crores. Just wanted to understand why the interest cost has stayed the same while the debt has come down drastically.
Anubhav Gupta
So see, I mean, here, I mean, if you look at the interest cost, which we account INR13 crores, INR14 crores for the whole year, okay, for the quarter annualizes around INR50 crores, INR55 crores. So this translates that we have used like kind of loan of INR740 crores. Short term, long term, it is Suraj’s call that how we wants to navigate with the bankers.
Now out of INR750 crores, I mean — so that’s the loan or that’s the limits we have taken from the banks, right? So half of this goes for the bill discounting, right, because we sell on cash-and-carry. So we get the receivable discounted from various banks. And plus there is a gross debt on the books, which you can see around INR134 crores.
And then we use some bank limits while we import steel from overseas. So a lot of steel is always on high sea where I mean, we have to fund those purchases. So that’s the breakup of like the quarterly interest cost of INR13 crores, INR14 crores or I would say, INR5 crores per month — INR4 crores per month run rate. But then at the same time, we have INR800 crores of cash on the books, right, which gives us around INR15 crores, INR16 crores, INR17 crores of quarterly interest income also.
Vivek Patel
Yeah. Understood. Just a small follow-up, sir. How much of your steel requirements are you importing now?
Anubhav Gupta
Now it will become very less only in Dubai, right, because the Indian government recently imposed steel duty, antidumping tariffs. So for India, anyways, we were importing very less since April 2025, antidumping duties came in. And now the government continued it for next two years. So nothing much here. Dubai, of course, it is all imported.
Vivek Patel
Understood sir. Thanks a lot and all the very best.
Operator
Thank you. Our next question comes from the line of Rahul Kumar from Vaikarya Fund. Please go ahead.
Rahul Kumar
Yeah. Hi. Can you just elaborate further on the interest cost breakup between the various heads which you mentioned? So how much was because of bill discounting? How much was because of short-term cost, short-term debt?
Anubhav Gupta
So 50% is because of bill discounting, okay? And 50% would be — 40% will be for import of steel and rest would be like bank charges, etc.
Rahul Kumar
Okay. And there is short-term debt also, right, INR134 crores?
Anubhav Gupta
Yeah. So that I’ve taken into account.
Rahul Kumar
Where, which side?
Anubhav Gupta
Others…
Rahul Kumar
Okay. And how much bill discounting we do on an average?
Anubhav Gupta
So normally, like you can back calculate when I say 50% is bill discounting, right, interest cost, 7% is the interest rate, you can do back calculation.
Rahul Kumar
Okay. And second question, I think on the renewables structure business, can you give some more color on the order book status, how it has moved? And what is it now?
Anubhav Gupta
Yeah. So order book is INR300 crores plus, right? I mean, which is enough to do volume of around 25,000 tons for the quarter four. So we are fully covered for that. And as we have installed almost 2 gigawatt of — 1 gigawatt, 1 gigawatt, 1.5 gigawatt of structures we have already installed since we started the business in quarter 1, right?
So now there is a lot of acceptance in the market that SG Mart is already number-two player and the empanelments have become very easy now. It’s just that steel prices went up a bit. So purchases like the new orders will take five, 10 days to settle because all the purchase heads of solar companies, they are getting adjusted to the increase in steel prices. So maybe like early Feb, this INR300 crore order book could be above INR400 crores with the pipeline what we have in hand.
Rahul Kumar
Okay. So this INR300 crores is only for the Q4?
Anubhav Gupta
No, no. 25,000 ton if we do the average realization is 75,000. So it’s around INR100 crores, INR200 crores.
Rahul Kumar
Got it. And correct me if I’m wrong, how much volume did we get from the two new rented facilities which have opened in the quarter?
Archit Arora
So it’s around 3,000, 4,000 tons per month from each entity.
Rahul Kumar
Okay. So does that mean that…
Archit Arora
Now that we are setting up our own centers, right? So we are not ramping those up. We’re just waiting for our centers to start. So once we start our centers, so this 3,000, 4,000 tons will shift plus additional 5,000, 6,000 tons will capture extra market.
Rahul Kumar
Okay. Got it. Thanks.
Operator
Thank you. Our next question comes from the line of Aman Soni from Nvest Analytics Advisory LLP. Please go ahead.
Aman Soni
Hi, Am I audible?
Anubhav Gupta
Please go ahead.
Aman Soni
Hi, good evening, sir. Sir, first question, again, like this quarter also, we are speaking about INR60 crores EBITDA. And maybe I’ve joined a little bit late, so maybe you must have explained it. So just wanted to understand from you, INR60 crores EBITDA that we are targeting. And at the same time, we are speaking about there is a little bit of slowdown in steel downstream products, demand of steel downstream products. So how are we confident enough to achieve this big number, sir, in Q4?
Anubhav Gupta
So two things. One that we already achieved INR40 crores business EBITDA in Q3. So this gives us a lot of confidence for Q4, number one. Number two, B2B metal business and service center business, we are assuming flattish sales volume. We are not factoring in any increase in the sales volume sequentially. Because the demand environment was weak in quarter three, so there was a push sales, which led us to offer some discounts to the customers. But now we have pulled off those discounts, and we are getting the desired margin of INR1,000 per ton in B2B and INR2,000 per ton in the service center business.
So earnings will increase from improvement in the margins in B2B and service centers. Plus the solar business, we did 17,000 ton volume. Now we are projecting 25,000 tons. right? So 30% increase in the volume there. And margins will also expand as the operating leverage benefits come in plus the new products for trade like solar structure for the residential rooftop application, that we launched. Then cable tray will start next month, then the slotted angle, which is used for racking system. Then purlin structures for PV sheds that will start. So we are expecting almost 10,000 tons of additional volume from these products in the quarter four. And because they’re selling under APL Apollo brand, so the margins are really high. So this gives us confidence that INR60 crores is a very much achievable number in terms of business EBITDA.
Aman Soni
Okay. And usually, we speak about that business EBITDA will obviously reflect in the bottom line as well. So can we expect the similar PAT?
Anubhav Gupta
So interest cost will be similar to the other income, right? And tax rate will be slightly lower because Dubai is also contributing. So growth-wise, it will match, yeah. But because — see, what’s happening is that business is using cash to build capacities to open service centers. So the other income will slowly, gradually keep on going down, right? Like earlier we used to INR1,000 crores, INR1,100 crores cash on the book. Now we have INR780 crores, INR790 crores cash.
As we go on to acquire land for 20 locations — for 10 more locations, again, we’ll have to use cash for capex, right? So we’re talking to some machine vendors where we purchase machinery for all the 10 service centers in one go so that we get a very sweet deal, right? So we may have to pay advances for buying of machinery. So I mean, it’s just that other income will keep on going down as the business will use more cash. Otherwise, the flow from EBITDA to PAT will be same.
Aman Soni
So let’s pose INR350 crores EBITDA target that we are taking for FY ’27, what is the bottom line are you anticipating there?
Anubhav Gupta
So I think let’s calculate here only. Other income, Suraj will be like what, INR40 crores, INR50 crores for the full year next year?
Unidentified Speaker
Less than that INR500 crores…
Anubhav Gupta
INR500 crores. So INR30 crores interest rates are going down. So INR40 crores — so INR400 crores is Naman the — INR400 crores is the EBITDA with other income, okay? Then interest expense will be how much…
Unidentified Speaker
Somewhere around INR50 crores. And depreciation is somewhere around INR15 crores.
Anubhav Gupta
INR15 crores, INR335 crores into 0.23. So we’ll be around INR250 crores PAT.
Aman Soni
More or less like it will also be growing in the direction — direction of EBITDA? Understood.
And sir, last quarter, when we spoke on this EBITDA run rate, so you mentioned very clearly like Q4 will be the one where our business dynamics will get defined in the terms of the EBITDA that we will be doing going ahead because of the product mix change. As you mentioned, we are a little bit more focusing on the service center business and the emphasis will go down on the B2B business. And that’s why the steel prices impact will be — over the quarters will be negligible, right? So if that time has arrived or not, like Q4 run rate will — can we assume it to be a next base for SG Mart?
Anubhav Gupta
Sir, that’s why with a lot of conservativeness, we are giving this number, although our internal target is high, right? So INR60 crores is something which we shall achieve definitely. I mean you should have — I mean, we could have delivered performance in Q3 also if there was no inventory write-down. So yeah, INR60 crores here and then INR65 crores, INR70 crores, INR80 crores, INR90 crores, that’s how Q1 FY ’27 to Q4 will slow down to for us to achieve INR350 crores. So we don’t see much of error in these numbers.
Aman Soni
Understood. And just last one clarification on the demand outlook, maybe a little bit on the longer side. I went through the PPT of your group company as well, there also the Chairman has highlighted the ongoing slowdown in the construction and particularly on the government capex side. So how do you see this? And how do you see the picture shaping up from here? Like is — are you also witnessing these kind of slowdowns to continue maybe for the next few quarters?
Anubhav Gupta
I mean macro should be better than what it is. There is no doubt about it, okay? But for us to be able to achieve our guidance, what we are focusing on is that I mean, either we are launching new products, we are getting into new entries or we are opening service centers in new locations.
So it’s like new customer acquisition or new product addition. So we are not cannibalizing the existing business, right? I mean the sales volume from service centers, we have already taken peak number of INR8,000 per ton from the existing operational service centers. Now it may INR9,000, INR10,000, INR11,000 if demand is good. So that’s the upside. But while giving you FY ’27 guidance, we are factoring in 8,000 ton only per month from one service center because — I mean, factoring in the demand slowdown. If there is upside, that numbers can definitely go up.
Aman Soni
Got it sir. That’s it from my side, sir, and all the best for the future. Thank you very much.
Operator
Thank you. Our next question comes from the line of Vishal Mehta from Oaklane Capital. Please go ahead.
Vishal Mehta
Hello, sir. Am I audible?
Anubhav Gupta
Yeah, Vishal, please go ahead.
Vishal Mehta
Sir, my question was regarding the renewable division. Now I just wanted to understand, if I’m having my calculations right, this quarter, we did about INR45 crores per month revenue with a 5,000, 6,000 volume. And what we are effectively guiding for FY ’27 is for the solar business, this will become INR110 crores and there will be a 15,000 volume per month.
Anubhav Gupta
So Vishal, 17,000 tons in renewable…
Vishal Mehta
That’s for the quarter, right? About 5,000 per month. So what I’m saying is from 17,000. So basically, if I multiply that by 4, it’s close to about 80,000. So 80,000, we are expecting 80,000 to go to 180. So I’m just trying to understand how do we bridge this gap from 80 to 180 in the solar business. As in do we — so because we have orders only worth INR300 crores, INR400 crores. So is there a visibility that we have for that? That is the first question. And I can come back for the second one, I’ll ask that once this is done.
Anubhav Gupta
So Vishal, this 17,000 tons, which we did, it only — we only did it from one plant in Ghaziabad. Now we — our Raipur plant has started and our Pune plant is also starting in February, okay. So our capacity will be 3 times of what it is right now, number one.
Number two, we had the order book of like INR250 crores to INR280 crores. Now it is INR300 crores. So we were just waiting for our capacities to start, right, new capacities in Raipur and Pune to start before we go aggressive on the order booking.
Third is that, like I said, there has been increase in steel prices in the month of January. So all the solar companies, they have kind of delayed the purchases because they’re adjusting to the new steel price, right? Everyone thinks that steel prices can’t increase so sharply, they may come down. So they may see that how Feb pricing goes about, right, and then they will start taking the call. So order booking will come in Feb. We are not bothered about it.
Number four is the kind of demand for solar structures, which is going to come up, right? Right now, the market is around 50,000 tons a month, okay? And we only did 5,000 tons, okay? And we are talking about 15,000, 20,000 tons to 180, meaning 15,000 tons a month, right? So I’m not — I’m talking about like 20% market share, 20%, 25% market share with the capacity as a number-one leader, okay, that much capacity we have put in. And I mean you talk to like top 10 IPPs of India, the kind of installations they have in their business plan. Some of are listed also, you may get public data also. I mean that’s insane. So we believe that this 40,000, 50,000 tons monthly market could go to 70,000, 80,000 tons in next two, three years on a monthly basis.
Vishal Mehta
Okay. And sir, in terms of the margin profile in the — so we’ve spoken about INR4,000 per ton for this business. But in the presentation for the solar business, renewable business.
Anubhav Gupta
Yeah, yeah. So we gave 6% to 8%, EBITDA target.
Vishal Mehta
In the presentation, it is 6% to 8%. So is there a disconnect because that turns out to be a little 6,000 odd…
Anubhav Gupta
So here, I mean, there are some products which are upcoming, right? So there, the NSR is a bit low. So the blended NSR will be INR65,000 per ton, and let’s take average of 7%, so INR4,500, INR5,000.
Vishal Mehta
Got it. Got it. So the NSR for the new products is a little lower?
Anubhav Gupta
Yeah, because that’s only zinc coating, whereas solar structures are zinc plus aluminum coating.
Vishal Mehta
Great, sir, very encouraging. Thank you so much. All the best.
Anubhav Gupta
Thanks. Thank you. Sure.
Operator
Thank you. Our next question comes from the line of Rajiv Bhatt [Phonetic] from KL [Phonetic] Securities. Please go ahead.
Rajiv Bhatt
Yeah, good evening, sir. I just had a couple of questions. One is related to the current geopolitical environment, which is going on, right, between U.S., European Union, China and how it’s impacting the trade within India? So knowing with this global dynamics being the background, I just wanted to understand how exactly would it be impacting the SG Mart’s ability to deliver on the guidance of EBITDA, which you said INR60 crores in Q4 and INR80 crores per quarter going forward. And specifically, what measures are you taking to mitigate any kind of risk related to steel price volatility or any trade disruptions, etc.
Anubhav Gupta
So see, I mean, the — in terms of risk management, okay, the steel prices in quarter three by end of December were at like almost low in the last six years. We saw that steel prices just before COVID. After that, there has been a massive rally in steel prices until 2023 and then they started coming down, right, 2024 and ’25.
And December ’25 was the lowest. So we were like keeping inventory pretty low, right? And we were kind of confident, although it’s very difficult to take a bet on commodity cycle, but we were fairly confident that steel prices should not be going lower than the levels what we saw in December. And today, there have been — I mean, till today, there has been result from one steel mill, which came out. So the EBITDA spreads of that company also, they are pretty low. So Indian steel mills were sure that they had to increase pricing January onwards. So in risk mitigation, only thing what we can do is keep minimum inventory levels, right? We don’t want to speculate or take bets on steel price movements because that’s not part of our business plan, never was, never will be.
Secondly, on geopolitical, I think how it can impact or how it is impacting global commodities is, I mean, the rise in pricing only, right? You take any commodity, the prices are going high only. So we work on pass-through model, right? Our products are fully linked to the steel prices, how they behave domestically or internationally. So yeah, I mean, we don’t expect it to hurt too much on a full year basis. In one quarter, like quarter three got hit because of like sharp f. But it will not repeat again and again. So what encourages us is that we generated INR40 crores of business EBITDA in Q3, which will go to INR60 crores in quarter four. I mean that’s what we are thinking.
Rajiv Bhatt
Yeah. Sir, my second question is related to last year — late last year, Mr. Rohan Gupta from your group, he had basically shown confidence in the stock and he had done a purchase, open market purchase of 329 or so. Now that we intend to kind of grow up the guidance which you have given, which kind of gives us also as investors confidence that if in case if the stock price were to correct basis what kind of guidance which was given in the past and the performance which you have clearly stated was because of situation which are outside the management’s control, right?
So if at all the stock were to kind of correct negatively, I presume that the management has got the confidence to kind of do a similar kind of buyback for the open market. Any kind of thoughts on that particular thing in terms of the conviction of sticking to the guidance and thereby also giving confidence in the extended investor community?
Anubhav Gupta
So definitely, I mean, that transaction happened in September 2025, right, where the family added 3.5 million shares. And I mean — we were confident on — we are confident on like how SG Mart earnings trajectory will look like, right? So yeah, I mean, the family, the management, the promoters, everyone is pretty bullish on the long-term prospect of the company.
Rajiv Bhatt
Thank you, sir, and all the best. And we have fingers crossed that the guidance is something which we actually see on the ground. Thank you so much.
Anubhav Gupta
Thanks.
Operator
Thank you. Our last question comes from thOur last question comes from the line of Vikas Mistry from Moonshot Ventures. Please go ahead.
Vikas Mistry
Yeah, thanks for the opportunity. Hi Anubhav and hi, Sudhir, how are you? So first of all, very congratulations on expanding your portfolio in terms of renewable and structures. So we have given the market share across this renewable and structures. And how we are confident enough to get that much amount of market share? And what is the competitive intensity across the segments?
Anubhav Gupta
So here, there are two sales points. Number one is OEM, which are India’s IPPs, okay, or solar EPC players. Number two, these other structures, which are sold through trade. So APL Apollo Group has 800 dealers across India, which further sell to 50,000 retail shops and those 50,000 retail shops sell to 200,000 fabricators.
The channel to sell steel pipe or any other product which the group has been doing. So what we found out is the channel is safe, okay? So — and if you look at the Slide Number 15, there are two products on the left side, which are operational. Number one is the utility, which is OEM sales point business. And second is it’s called strut, which is, which goes on the rooftop of residential structures, okay? So this is sold through trade. We launched this product last month, December. And I mean, we are already selling like 1,500 tons per month, okay, per day, 1,500 tons per day. I mean we only got like one mill. three more mills are coming. So one mill is already full. So it’s the vast network, which will drive the sales for these products, okay?
And as far as the IPP is concerned, the OEM-led business, like I said, in last eight, nine months since we started, we have already supplied structure to install 1.5 gigawatts of solar energy of solar power, which gives enough confidence to the industry that SG Mart has established itself as a serious player to supply long-mounted solar structures for the industry. Here, the right to win is again, steel, which comes from Tata, JSW, right coated steel, and we are already buying in bulk getting advantage in terms of pricing and some benefit we pass it on to the customer to win the order.
Vikas Mistry
Okay. So Anubhav, apart from these products, what we mentioned in the presentation, do we have other products which are lined up, which are of similar size and which are of high value addition? Do we have them?
Anubhav Gupta
So maybe in service centers, we are exploring selling of — right now, we sell HR-led sheets, metal sheets. We are working on some coated sheets also, right? Maybe in next earnings call or maybe one quarter further, we will come back — we will come with a business plan that how within the existing service centers, we can expand the portfolio from normal, or I would say, HR metal sheets to coated metal sheets also.
Vikas Mistry
Yeah, thanks. Good to hear that. So my last question is itself on volatility towards that is dragging inventory losses, making inventory losses. So at what run rate of EBITDA where we feel comfortable with the 5% to 10% drawdown on maybe quarterly EBITDA level drag due to 3% to 4% drag in the price.
Anubhav Gupta
This will keep on going down as our absolute EBITDA keeps on increasing. Like I said, we are…
Vikas Mistry
Sorry for interruption. Anubhav, I’m just trying to pick your brains on the fact that at what EBITDA level it becomes pretty small. So my — our internal understanding says that at roughly INR150 crores of EBITDA level, that becomes pretty insignificant. So what’s your take on that?
Anubhav Gupta
I think INR350 crores we hit in FY ’27, okay? We should be fairly okay. Then when we go INR500 crores plus, then the hit — the pinch will be very, very less.
Vikas Mistry
Yeah. Thanks. Thanks, Anubhav, for that, and kudos to the team. And we hope that you continue to bring new products, high-margin products.
Anubhav Gupta
Thank you so much. Thanks. Thanks so much.
Operator
Thank you. Ladies and gentlemen, that was the last question for today. I would now like to hand the conference over to Mr. Anubhav Gupta from SG Mart Limited for closing comments.
Anubhav Gupta
Thanks, everyone, for joining in. I know that numbers look disappointing. But in real, we have done much better, and we will do much better in quarter four, which will give a lot of confidence to the investors that how we are going to achieve INR350 crores EBITDA next year.
Thanks so much.
Operator
[Operator Closing Remarks]