Shyam Metalics and Energy Limited (NSE: SHYAMMETL) Q3 2026 Earnings Call dated Jan. 27, 2026
Corporate Participants:
Pankaj Harlalka — Head of Investor Relations
Brij Bhushan Agarwal — Chairman & Managing Director
Deepak Agarwal — Whole-time Director & Chief Financial Officer
Analysts:
Unidentified Participant
Amit Dixit — Analyst
Vikas Singh — Analyst
Devesh Lakhotia — Analyst
Mudit Bhandari — Analyst
Ashish Kejriwal — Analyst
Rajesh Majumdar — Analyst
Ruchit Agrawal — Analyst
Omkar Bagwe — Analyst
Presentation:
operator
It.
operator
Ladies and gentlemen, good day and welcome to the Q3 and 9 months FY26 earnings conference call of Sham Metallics and Energy Limited hosted by MUFG in time. 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 Star then zero on your touchstone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Pankaj Harlalka from Sharp Metallics. Thank you.
And over to you sir.
Pankaj Harlalka — Head of Investor Relations
Thank you, Sudha. Thank you ladies and gentlemen for joining us in the call. I, Pankajlalka, Head of Investor Relations at Shyam Metallics, wish you all a very good afternoon and a warm welcome to the third quarter. FY26 post results conference Call before we delve into discussing the quarterly numbers, I hope you all had an opportunity to review our press release and the attendant investor presentation. Read along with the Safe harbor statement which are available under the investor section of our website and the same are accessible in the BSC and NSC website. To discuss the third quarter and nine months results FY26 I’m joined by Mr.
Bridge Bhushan Aggarwal, Chairman and Managing Director Mr. Deepak Agarwal, Executive Director, Finance and Compliance and Mr. Sumit Ketan from Orient Capital, our Investor relations partner. Now I would like to invite Big Bhushanji to provide his perspective on the performance of the third quarter of the current financial year.
Pankaj Harlalka — Head of Investor Relations
Thank you.
Pankaj Harlalka — Head of Investor Relations
And over to you sir.
Brij Bhushan Agarwal — Chairman & Managing Director
Good afternoon everyone. Thank you for joining us on the call. The industry continued to face a challenging environment during the quarter. Global demand remained subdued due to the ongoing geopolitical uncertainties and fluctuation in key raw metal prices. In contrast, domestic demand remains stable during the period. Let me briefly touch upon the prevailing operating and industry environment which continues to evolve amid global and domestic development. Globally, the steel industry has been impacted by trade related action including tariff measures in the key area and markets such as US which has altered international steel flows. These developments have led to higher diversification of steel into alternative markets creating some pricing pressures across regions.
Increasing polarity in global steel prices from domestic prospect. India economic fundamentals remains structurally strong. Steel demands continue to be supported by infrastructures, development, manufacturing activities, urbanization with global spending on huge infrastructure such as road, railways, power, urban infrastructure driving demand for long product. However, near terms demanding certain retail and secondary segment remains caution leading to selective pricing pressure. Despite these challenging and challenges, we are pleased to report a decent strong resilient performance by SHA Metallic during the quarter, our volume growth on year on year is 25% higher and revenue growth is almost 18% over the first nine months of the year, Sham Metallic delivered solid growth in both terms of revenue EBITDA highlighting the strength of our business model.
This performance was driven by our integrated operations, diversified portfolio, sustained focus and cost efficiency. During the quarter we successfully commissioned and started commercial production of 0.45 million ton of blast furnace at our Khalagpur plant. This commissioning meaningfully increase our steel making capacity strength, our integrated manufacturing setup support our long term growth ambition. Further, I am happy to announce that in the last quarter of F526 the 90 megawatt of captive power plant and 0.15 million ton of color coated plant are expected to be commissioned with their prospective impact in the cash flow and become clearly visible for FY27.
Additionally, the backward integration of aluminum flat product of 0.6 0.06 million ton per per annum with aluminum caster meal, the new foil plant capacity of 20,000 tons per annum to be commissioned by June 2026. Building on this momentum, I am pleased to announce the Board had approved the fresh capital investment of 6,660 crores to support the next phase of our growth. This investment will be used for capacity expansion, improving the processes and developing more downstream and value added product. The proposed CAPEX will be funded primarily through the internal accruals and borrowing if required. These investments are aligned with our long term goal of expanding operations, improving efficiencies, strengthening infrastructure, increasing margins while maintaining strong steady sustainable growth.
To further strengthen our Board, we are pleased to announce the appointment of Mr. Subrato Bhattacharya as an additional Director for the term of five years subject to the shareholder approval. Mr. Bhattacharya is a very distinguished metallurgist and seasoned corporate player with over 39 years of extensive experience in specialty steel stainless steel industry. He has previously served as full time director at Jindal Stainless Limited and CEO of Viraj Profile Limited we warmly welcome him to the Board of Shah Metallic. On the regulatory side, we welcome the decision to impose the safeguard duty on steel import. This move is extremely supportive for domestic manufacture as it helps address unfair import pressure and improve pricing discipline, stability and support mechanism in the market and create a better support capacity utilization.
To conclude, we remain focused on sustainable growth, improving profitability, creating long term value for our valued shareholders with disciplined execution, prudent capital allocation and clear growth strategy. We are confident and we are confident of closing FY26 with strong note. Thank you for your continued support trust and we look forward to engaging with you in the quarters ahead with this. Now I conclude my speech and I would request our CFO Mr. Deepak Aggarwal to take us through the financial performance. Thank you to all.
Deepak Agarwal — Whole-time Director & Chief Financial Officer
Thank you sir. A very good afternoon and a Happy New Year to all the participants. I thank you all of you for taking time out on this call to discuss the result for the third quarter of the current financial year for the Indian steel industry. The current phase is characterized by healthy volume growth alongside persistent pricing challenges. Incremental domestic capacities coupled with global price softness have kept realization under check even as demand remains steady. Overall, while the external environment continues to remain dynamic, the underlying fundamentals of the Indian steel industry remain intact at Shah Metallic.
Our diversified product portfolio, integrated operations and prudent capital allocation approach positioning us well to navigate near term challenges and continue delivering sustainable performance over the medium to long term. Despite this headwind, Sha Metalic has delivered a strong operational performance in quarter three of the current financial year driven by higher volume, improved product mix and disciplined cost management. I would like to share a quick review of the reported consolidated financial for the third quarter of the current financial year, the Company reported an operating revenue of 4,421 crore in quarter three of the current financial year, registering a growth of 17.7% over quarter three of the last year.
This growth was primarily driven by a 25% year on year increase in volume reflecting successful ramp up across key product segment and capacity utilization. For the nine months ended December 31, 2025, the company reported a consolidated revenue of 13,312 crore, registering a growth of 20.9% over the nine months of the last financial year. On the profitability front, the Company recorded an EBITDA of 539 crore up 6.3% year on year with an EBITDA margin of 12.2%. Operating EBITDA stood at 487 crore, a growth of 6.9% over quarter three of the last financial year with the operating EBITDA margin of 11% margin were impacted by lower realization in carbon steel and sponge iron partially offset by higher contribution from the aluminium, stainless steel and iron pallet.
If I have to speak on nine months ended 31st December 2025, the consolidated EBITDA of 1,781 crore registering a growth of 16.6% over the last year and operating EBITDA of 1606 crore which registered an 18.9% growth over the last year. The profit after tax for the quarter stood at 198 crore broadly stable on a year on year basis the pat margin for the quarter was 4.5% which remains healthy considering the current price environment in the sector. In the steel sector for the nine month ended 31st December 2025 the pad is 749 crore registering a growth of 8.6% over the last year.
From a product perspective, the iron pallet realization improved by 5.4% year on year while aluminium stainless realization increased by 8.5, 8.4% and 11.3% respectively. Highlighting the benefit of our diversified and value added product portfolio realization is specialty alloy carbon steel sponge iron remain under pressure due to the market conditions. In terms of volume, the company delivered a strong growth across several segments. Iron pellet Volume increased by 43% year on year. Specialty alloy volume increased by 18.7%. Stainless steel volume increased by 8.8% during the quarter. We also continue to scale up volume of our color coated NPGR.
Deepak Agarwal — Whole-time Director & Chief Financial Officer
As our.
Deepak Agarwal — Whole-time Director & Chief Financial Officer
Ongoing CAPEX projects are progressively as planned. As of nine months of the current financial year we have incurred already incurred 8038 crore against the total project planned capex of 9425 crore which is almost 85% of our total capex plan. Out of this 8038 crore, 5357 crore has already been capitalized. These investments are starting to deliver benefit through better operational efficiency, lower cost, improved product quality. As this project stabilized further, we expect additional benefit to reflect in our performance in the coming quarter as well. In line with the long term growth plan Board has further approved a capex of 6,660 crore which will be deployed towards the capacity expansion, value added product and strengthening backward integration.
These investments will enhance scale, improve cost competitiveness and support margin expansion over the medium to long term. This CAPEX will be incurred through internal acquiring majorly and borrowing if required from time to time. We remain confident of closing for the current financial year on a strong note and supported by a robust volume increasing contribution from value added product and disciplined execution of our group study. With this now I’ll open the forum for the question and suggestion. Thank you.
Deepak Agarwal — Whole-time Director & Chief Financial Officer
Thank you very much.
Questions and Answers:
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We will now begin with the question and answer session. Anyone who wishes to ask a question May press R and 1 on the touchpoint telephone.
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Participants are requested to use handsets while asking a question.
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Ladies and gentlemen.
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First question is from.
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The line of Amit Dixit from.
Amit Dixit
Yeah Hello. Good evening everyone and congratulations for a good set of numbers in a very testing environment. A couple of questions from my side. First of all, congratulations for announcing yet another Capex plan. The first question is essentially on one of the elements of this Capex plan. That is wagons seems to be little bit unrelated area of our operations. So just wanted to understand the kind of synergies that you are seeing and particularly this particular industry. You know in Calcutta itself we have a number of companies. So what and how different we will be from those companies.
I just wanted to understand that strategic rationale. That is the first question. Sir.
Brij Bhushan Agarwal
Wonderful. Thank you. Amit. You know that Sham metallic is now setting up a aluminium backward integration with a cold rolling meal will be making lot of aluminum sheets. We are coming with our stainless steel flat product which is going to be commissioned in next couple of years. We are setting up an HR coil plant. So if you see in the wagon industry the major fabrication raw material is the backward and forward integration to our existing proposed plant. Also if you see the margins in the wagon and the advantage what we have like it is a very low capex.
Like the total capex is close to hardly 200 crore. And we have a complete infrastructure available as a railway line. As most of the infrastructure required for the sheds and all for the wagon plant. In our existing plant it will add lot of value because once we make a product we have lot of value added product. In our existing manufacturing facilities as well we have lot of, you know, unsized products which will be able to create more value addition in the wagon plant. It is a very small investment and if you see the railway demand which is going to come up in the near time we are seeing the infrastructure is growing and I feel this is the area where we should start with very small, a very small Capex.
And once we see that we are able to we are totally convinced with the strategy growth and all we have further area of expanding into a various kind of high value added wagon business. Like value wagon business will start basic one in the stance but later on we can get into metros. We can get so many. This is just a stance of a testing new project where the backward and forward integration has a lot of value to us. And we have a captive railway siding. We don’t have to build up a railway line. We don’t have to build up too much big infrastructure which is required for the wagon plant.
Thank you.
Amit Dixit
Got it, got it. The second question is essentially on the, on the portfolio itself product portfolio. So if I look at it There are four distinct buckets of products. Now you have aluminum foil, stainless steel, we have longs and flats in carbon steel. So going ahead where the focus will be I understand, I mean broadly it is on downstream products but I mean you have recommended the induction of Mr. Suburbator Bhattacharya. So is it that we would be focusing on stainless in the near term or you know, going ahead where do we see your capex coming?
Amit Dixit
Coming.
Brij Bhushan Agarwal
Very interesting question. I’ll just brief you, you know if you see the sham metallic as a company. We are a metal company and we would definitely like to invest in the future sustainable long term value chain. If you see in last three years like we have, we started with a small pilot plant of aluminum foil plant. Now we are close to around thousand crores and in next two to three years we are targeting that we should be close to three, three and a half thousand crore business will be able to develop with the backward integration creating more margins in aluminum knowing understanding the business.
Since we have now more than 40% of our export market on the overall business we are adding a lot of value in us. But this comes from the aluminium chain for next couple of years and it is giving a decent margin, you know the EBITDA margins, the product margins and the innovations on the new metal in the aluminum space. Lot of action is being there from the stainless steel point of view. Yes, now we are in the carbon steel where the prices are always, you know, very, very competitive. And stainless steel is also one of the value addition over the carbon steel.
We make specialty alloy, we have our own power, we have our own steel. We are focusing more on the 200 and 400 grade stainless steel where we have a neck and we should be able to capitalize more on the value Additional stainless steel is a kind of a value addition in our existing metal space. And as you know there is very the per capita of stainless steel in our country is very, very low. And the kind of penetration which we are seeing in the stainless steel businesses like you know, in the construction steel, in the other flat products and all in the white goods we are seeing there is a lot of in the railways, in the other infrastructure special engineering manufacturing like India is becoming the hub of the smart manufacturing.
So I’m seeing a lot of penetration in the stainless steel and this is going to add a lot of value forward and backward to our existing industry creating our model more robust, sustainable and creating more value for our shareholders.
Amit Dixit
Great, great. Thank you and all the best.
operator
Thank you, thank you, thank you ladies and gentlemen. Anyone who wishes to ask a question may press R and one on their touchstone telephone. The next question is from the line of Vikas Singh from ICICI Securities. Please go ahead.
Vikas Singh
Good afternoon sir and thank you for the opportunity. Sir, my first question pertains to our aluminium segment realization which seems to be down on a sequential basis. Contrary to how the aluminum prices have moved up in the international market. So how our mix have been deteriorated and how does it impacted our overall performance.
Brij Bhushan Agarwal
There are two things Vikash to calculate. One thing is, you know we are not the primary manufacturer of aluminium. We are the value added manufacturing of aluminum. And in aluminum there are a lot of sections, lot of product where we have a high beta. And there is a lot of product where the EBITDA is little lower but the productivity is higher. If you see the results in the terms of, you know the numbers, we are increasing quarter after quarter but because of the volume is going up and to see the best value per ton EBITDA per hour the decisions are being taken accordingly.
But yes, due to some forex fluctuations maybe some imports are there for the foil or maybe you know some kind of a slowdown in the American market. Some impacts are there but it’s not majorly affected.
Vikas Singh
Notice sir, in our opening remarks basically we talked about the challenging condition still persist by the cfo. So just wanted to understand after the safeguard duty we would have a healthy price hike. So is the demand is still an issue because price seems to be on a healthy side. If I just check on the domestic market as well.
Brij Bhushan Agarwal
From December duty has been introduced. There is a decent price increase from this month onwards. From January onwards. Last quarter the price was extremely low. And there is lot of volume in the transit by the secondary in the hand of secondary people. So it takes time to evacuate. But overall as a country demand is concerned. We are utilizing our plant at more than 90, 95% capacity irrespective of, you know, some little bit of price pressure. But we are able to sell the material. So not majorly but yes, things are going to improve. Because you know the country is growing, the demand is growing.
And to sustain the country growth we have to produce 300 billion tonnes. And we know how the systems are working now. So we are extremely optimistic and extremely bullish on our business.
Vikas Singh
I suggest this 6,660 crore is over and above that 9,700 crore capex. Right? So the total pending capex at this point of time would be 7,500 crore. If that number is correct which we will be spending in Three years.
Brij Bhushan Agarwal
Yes, yes Question to you.
Deepak Agarwal
Yeah. The remaining capex is around 8,000 crore which will be incurred in the next three years this quarter, last quarter we will be trying we will be incurring around 500 crore and every year we will be incurring around 1500, 1800 course every year.
Vikas Singh
Notice. And so just one last question this HR plant which we are planning to set up which would be. It would be set up in which of our plant and how much of the space we would be available post this expansion as well for the to incorporate the future expansion we have this.
Brij Bhushan Agarwal
Plant we are coming up, this plant is coming up in Bengal side Jamuria plant and apart from this we have enough land and some more land are under acquisition for at least next four to five years we don’t have to look back. Yeah.
Vikas Singh
Thank you. All the best.
Brij Bhushan Agarwal
Thank you.
operator
Thank you Ladies and gentlemen. Anyone who wishes to ask a question may press star N1 on the touch tone telephone. The next question is from the line of Rajiv Jain from RPN Investments. Please go ahead.
Unidentified Participant
Hello.
Brij Bhushan Agarwal
Am I audible?
operator
Yes sir, please continue.
Unidentified Participant
Thank you for the opportunity. So I just have a couple of questions firstly so how are you seeing demand trends in Q4 and early of financial year 27 especially for the finished steel and value added products? Could you throw some light on that?
Brij Bhushan Agarwal
We are extremely optimistic. I told you because you know since last one and a half two years the metal, steel was extremely challenging and in spite of that you know as a company Sham metallic has been decently performing with decent EBITDA numbers and all but now looking forward with the kind of growth vehicle what we are seeing every quarter it is becoming robust.
Demand is not a challenge because whatever steel is being produced in the country it is being consumed and we know like you know if you are talking of 7 to 8% GDP and we are producing around a close 260 million ton of steel every year compoundingly we will be requiring around 11 to 12 billion tonnes. So we don’t have to really worry on the steel demand side cycle and all might be you know some kind of a geopolitical situation or maybe some kind of uneven surprises. What we are hearing from the pump and this kind of a mystery, you know it is a part of our journey but actually as a product, as a steel we really should not be bothered.
Market is very stable, there’s a good demand. We are seeing a lot of penetration happening in the private sector, smart manufacturing, rural development, infrastructure, roads, railways. So we don’t have to worry at all.
Unidentified Participant
Understood.
Brij Bhushan Agarwal
Sir. Understood.
Unidentified Participant
My next question is on.
Unidentified Participant
So you have already completed a large portion of your capex which was around 9,400. And so which key projects will start contributing meaningfully from FY26 and which ones will take a little bit longer to ramp up? Could you quantify that?
Brij Bhushan Agarwal
The last one is what, what we commissioned this year will be seeing at least more than 95% efficiency factor coming up from the coming year onwards. The Ramsaroop is again second blast furnace which is see a lot of action this year as well. The coal rolling mill expansion of color coated business will see almost doubling this year.
The aluminum backward integration plant is going to have another impact to double the revenue this year. And apart from that, you know, a lot of other power plants and some little bit of minor engineering in the existing plants. Iron making capacity of close to 200,000 tons you’ll see will be commissioned this year. So there’s a lot of action this year starting from, you know, the first quarter till the third quarter will see a lot of new plants getting commissioned. Understood sir. Understood. And in previous quarters you had mentioned potential benefits from PLI scheme for stainless steel.
So has there been any further progress on this since then? The plant is under the construction stage and once you are commissioning the plant then only you will be getting. So we have these are all statutory compliances which are on place. So we will not get immediate result till we commission the plant. So we have to wait for another one and a half. Okay. Okay.
Unidentified Participant
All right.
Unidentified Participant
Thank you for answering my questions and all the best for the future quarters.
operator
Thank you. Ladies and gentlemen. Anyone who wishes to ask a question may press star and one on their touchstone telephone. The next question is from the line of Karthikeya Kumar Pandey from 361 Capital. Please go ahead.
Unidentified Participant
Am I audible?
operator
Yes.
Unidentified Participant
Yeah. Sir, thanks for the opportunity. You know, positive outlook that you’re sharing on steel prices. So like I just wanted to understand what kind of a margins like are we looking in the fourth quarter and then you know, for FY27 and FY28 if you just share some numbers on that.
Brij Bhushan Agarwal
We will definitely see a substantial better margins in Q4 in comparison with Q3 because the price have gone up. And I as as usual, if you see the history, you know, the past and all Q4, Q1 is always very inspiring because of it’s a season of construction.
There’s a lot of all we have done with all the festive and also we expect that, you know, at least if I’m not Mistaken if my unless people support me close to 10 to 15% or maybe 20% we will see more improvement on our margins and all this quarter and also subsequently becoming.
Deepak Agarwal
In addition to this you should also look into that in the next financial.
Deepak Agarwal
Year there are a lot of project.
Deepak Agarwal
Will be commissioned like aluminum foil flat.
Deepak Agarwal
Product like aluminum foils color coated. So definitely margin will be improved and also the growth will also be improved.
Unidentified Participant
Thank you.
operator
Thank you Ladies and gentlemen. Anyone who wishes to ask a question may press star and one on the touchstone telephone. The next question is from the line of Ashish Kjriwal from Nuvama Institutional Equities. Please go ahead. As there is no response. I’m taking the next question from the line of Devesh from Ikigai Asset Manager. Please go ahead.
Devesh Lakhotia
Yeah. Hi sir, just one question. Recently this 400 bucks per ton of cold fest was reimbursed. What kind of benefits are we expecting from that? And when will that start to flow through? Or is some part of that already flowing in Q3 but largely I think power cost per kilowatt is largely similar. I think on a Q basis.
Brij Bhushan Agarwal
Actually it really doesn’t have a major impact on our power because you know our power plant is based on the waste and waste gases and waste product which comes out from the sea plant already. You know this kind of numbers at such a low.
When you are seeing the revenue impact is there it means there is a huge impact on the, you know the overall. It has also it has already been, you know taken care of in the third quarter and subsequently whatever the carryover stocks are there it dilutes slowly. So we will see subsequently there will be a decent improvement in the coming quarter. But power definitely it doesn’t have that major impact because we don’t use fresh coal. We just use the rejects and wash the rejects and waste heat and all loved.
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Thank you ladies and gentlemen. Anyone who wishes to ask a question may press star and one on their touchstone telephone. The next question is from the line of Modit Bhandari from IIFL Capital. Please go ahead.
Mudit Bhandari
Hi sir, thank you for the question. So first question. We are expanding capacities across our intermediate products including pellets, not pellets, sponge iron, pig iron and billet. And if I compare that capacity expansion with our Finix steel product including long and flat. So we are little aggressive more upon the intermediate product size. So is this any strategic call or how to look at this? Because at this rate we’ll be selling our intermediate products even till FY27 or 28.
Brij Bhushan Agarwal
See, I don’t know where did you derive this number? Because if you see from the Bengal plant the kind of HR what we are targeting, close to around 1.6 million ton. And if we are consuming our hot metal, that is pig iron and the dri so we are almost compensating and we are out of the intermediate product from the Bengal plant. If you see the Odisha plant also the stainless steel facilities and all what is coming up slowly, slowly it will add though we will not be completely zero downing the intermediate and either we want to zero down, we want to have some little bit of share to have a proper penetration and awareness on the market side.
And every intermediate product also what we sell, we sell in the profit margins. And also. But yes, the time to come in next couple of years we’ll see that, you know, we’ll be converting a lot of our intermediate product by ramping up our existing capacity and adding more value downstream.
Mudit Bhandari
Got it Sir. So directionally, FYI in FY27 more or less will be consuming all of our intermediate products.
Brij Bhushan Agarwal
No, no, not by FY27 it will be because HR is coming in two, two and a half year. If you see what we declared 29. So probably from 28 and onwards or maybe early 29 probably we expect that we should be able to consume what a lot of intermediate.
Mudit Bhandari
Got it sir. And in your slide on page number 23 what you have mentioned expected sales in volume FY28. These are sales to external clients for intermediate products, right?
Brij Bhushan Agarwal
All our sales are to the external system. We never calculate the sales of the intermediate transfers. All sales are related to the.
Mudit Bhandari
Thank you so much.
operator
Thank you ladies and gentlemen. Anyone who wishes to ask a question may press star and one on their touchstone telephone. The next question is from the line of Ashish Kejriwal from Nuvama Institutional Equities. Please go ahead.
Ashish Kejriwal
Yeah, thanks for the time. Sorry, I was on mute that time. And many congratulations for successful growth Capex without stretching the balance sheet very few times. We see that that’s many consolations for that. So my question is on hot rolled mill. I assume that we have 0.4 million ton of cold rolled mill. So obviously 0.5 million ton of that will be used in the hot road. So going forward do you want to go into sale of HRC coil or can we expect that, you know, next phase we can see further expansion in CR coil or further processing to colonized product.
Brij Bhushan Agarwal
Very, very intellectual question. Most appreciated. Yeah, you are right Ashish. Like you know, HR takes HR has a long efficient time. And our strategic HR of setting up close to you know 2 million or maybe 1.6 million ton at a price of less close to 5000 crore is something we have to appreciate. And we all know like you know any HR product when we set up we have to set up a complete iron making facilities downstream. And as a strategy of sham metallic being so conservative and prudent we had build up all our infrastructure backward and forward integration.
So our immediate step is that to we have to take up the HR project and we should come try to commission it. You know before time. What we delivered, what we committed and in the time from close to 0.5 million and what I presume you will be able to do from this plant in next one year we will definitely evaluate and we are still evaluating to create some more facilities. So that in the time to come at least 60, 70% we should be able to captively utilize. These are all strategic long term value added product fix what our team is doing and soon once we are through with our all diligence and board approval and all we would like to share but these are all very small capex in the size of our balance sheet or to the size of the project what we are doing.
Ashish Kejriwal
Understood sir. In this just a small query on this hot rolled mill plant. Is this including a steel melting chop as well as hot strip mill also or something else is also included in that?
Brij Bhushan Agarwal
No, no nothing. Only steel melting shop and hr. Ashish. Only steel melting shop and hr. Okay.
Ashish Kejriwal
Because when I’m comparing this capex. Normally our capex is much lower than the industry standard. But when I am comparing this with even for NMDC steel plant and just for hot strip mill and steel melting shop they are. They did something like 3 million ton at around 26, 2700 crore. So I was just wondering whether we are.
Deepak Agarwal
Sorry.
Brij Bhushan Agarwal
26,000 crores.
Deepak Agarwal
No, no no.
Ashish Kejriwal
This 23,000 crore was for the entire project.
Brij Bhushan Agarwal
3,000 crores.
Ashish Kejriwal
Yeah, yeah, yeah. But I’m paying for steel melting shop and hot strip mill Their cost was something like 2600 crore.
Brij Bhushan Agarwal
2600 crores.
Ashish Kejriwal
Yeah. So that’s why I was wondering you know where I’m missing something.
Brij Bhushan Agarwal
No, no no no. But you mean to say we are. We are doing at a higher cost. So you mean to say we are doing at a lower cost. I’m not ready.
Ashish Kejriwal
No, see their steel melting shop only cost around 2000 crore for 3 million ton. And then hot strip mill is separately which is around 2600 crore. That’s what I asked you know whether this 1.58 includes only.
Brij Bhushan Agarwal
We cannot set up. We cannot set up any hot hot rolling mill at 2600 crores. There’s some NMDC was a government plan which took almost nine and a half ten years to set up. I will not be very clear but for a million ton deal making facilities you need a billion dollar which is around close to 8 to 9,000 crores approximately. And yeah, but.
Ashish Kejriwal
Sorry because not that 1 billion dollar ballpark. That includes entire thing. You know. Blast furnace.
Brij Bhushan Agarwal
So this is what we are putting up. Just an intermediate plant of steel melting shop.
Ashish Kejriwal
Okay.
Brij Bhushan Agarwal
And HR. This HR meal has a capacity to do up to 3 million tons. But maybe you know in the second phase you will ramping up by adding more steel melting shop and all. But at first phase seeing the present scenario we don’t want to get into more iron making and all we want and we are targeting a very specialized product in our HR plant. A very thinner section and specialized steel as well. You know. No, no. It is a csp. It is no slab completely.
Ashish Kejriwal
So we will purchase slab from the market convert it into.
Brij Bhushan Agarwal
No, no, no steel melting shop. And we’ll be making since lab which is as good as. It’s a completely hot rolling. No reheating. There’s no reheating it. Okay.
Ashish Kejriwal
So that means.
Brij Bhushan Agarwal
Latest technology of this 22nd century. So we don’t have to look back. And we have. We have tied up with the world best conglomerate who is number one in the world. Who give to new call or you know all the world best plan and best plan in India also. I think zero compromise. Understood.
Ashish Kejriwal
Thank you sir. And all the best.
Brij Bhushan Agarwal
Thank you Rajesh.
operator
Thank you. Ladies and gentlemen. Anyone who wishes to ask a question may press star N1 on their touchstone telephone. The next question is from the line of Rajesh Majumdar from 361 Capital. Please go ahead.
Rajesh Majumdar
Yeah.
Rajesh Majumdar
Hi sir. Good evening. And I had a couple of questions. So if you look at our EBITDA quarterly range used to be between 400 to 450 crores. See in FY25 and then now we move to about 500 to 570 odd crores range in the last 45 quarters. And now with most of our capex already completed and probably just about 15002000 crores left on the 9000 crores capex that we’ve done 9000 odd crores. What would be our EBITDA range? Quarterly EBITDA range say from 1 QFY27 or whatever. Onwards that we can see.
Brij Bhushan Agarwal
We are. We are seeing like you know, this year we are expecting that we should be having a growth of close to, you know, 20% over the next year minimum 20, 25% last year, coming year as well. We are projecting that we should be maintaining the same growth what we are doing now. And if you see the fineness of the balance sheet being in so multi varieties of product and all. We had been very perennial on our profitability numbers and all on our projections. Because in last couple of years we have spent more on the cost side by adding power plants, getting into a value added, creating our institution more perennial and more sustainable.
And we expect that we should be growing at least close to 15 to 20% year on year for next four, five years minimum. And with the growth on the numbers, volume and the sales prices will see the numbers of the percentage of EBITDA will also improve. And if the top line is improving on the volume growth of the additional capacities and putting more downstream and all we’ll see the percentage of EBITDA will also improve with the revenue and all. So this is what we are focusing like when you are. We are talking from this chainless steel point of view.
We are seeing there will be a lot of penetration in the value addition and we’ll see the margins going up. We’ll see a lot of penetration coming up from the doubling the cold rolling mill capacity. The numbers will change. And once you put up the larger capacity, your cost, your efficiency and everything changes. Aluminum backward integration will help us to hedge more on the raw metal side will be able to manufacture more varieties of aluminum product where we are not able to serve to our clients. Once we have our own internal manufacturing of foil stock.
These are all strategic sustainable move from the organization side.
Deepak Agarwal
In addition to the I would also like to highlight the sir is telling about the group volume growth which will be around 15 to 20% year on year. Suppose if the realization will improve, definitely the margin will further improve. That is only on the conservative side.
Deepak Agarwal
The growth will be 15 to 20%.
Deepak Agarwal
As far as when we talk about.
Deepak Agarwal
It is basically on account of volume growth.
Rajesh Majumdar
So you’re not taking cyclicality into account here, just the current market conditions and predicting the numbers accordingly.
Brij Bhushan Agarwal
If there is a price conservative after three years. As if you can’t tell us. See whatever promises we have done in last three years on the growth side and all when we set up and we did an IPO three and a half years before with a top line of 6,000 crores and EBITDA of 600 crores. We are talking of this year more than 3x. You have to, you know these things. We have to internally we have to do a analysis and come to a true solution. It will not be fair on our part. But we are conservative.
We want to make sure that what we say we deliver it and what we want to create is a world class. We cannot be after three years, we cannot be any, any company where we have to compare with any of the commodity player or any of the Specialized Shyam Metallic should be a company where we should be able to showcase a different level of value to the shareholders.
Rajesh Majumdar
Right. My second question is also related to your conservativeness in a way. Your. Your low leverage is actually leading to a kind of low return on equity for the shareholder. Because since you’re a double A plus kind of borrower the debt levels in a metal company are normally much higher to see everywhere. So if we are able to have a more balanced leverage structure in our balance sheet then our roes can improve substantially. Because even at the peak, as per my calculations our roes are still not crossing 13% even if you take the entire capex into consideration.
So just a thought that maybe we can increase our dividend payout. We can increase our debt leveraging a little bit in order to improve our ratios.
Brij Bhushan Agarwal
Yeah, this. This is also, you know, because of a very subdued market. Apart from that, you have to understand in spite of so much challenges, you know what you are seeing in this sector from last couple of years we had been very perennial. We are prudent but we don’t want to take any risk on any of the businesses where we see that we are not very comfortable and we are not actually stalling any of our vision due to the capital constraint or anything. I know there is no capital constraint. We are prudent. It is better, you know, if we are prudent and we are more conservative.
This is a way any of these steel company, you know, is not a debt free. When we are talking any of the steel company double A plus, you know, we are not talking from today but we are talking from 20 years. The. So there are a lot of things where we can improve our margins which we are working on that by adding more value added. I know the lot of time for a new product some emerging metals where we see the numbers are changing, they’re trying to add more value on that and we want to definitely place the company at a unique position where you know, leverage.
Yes, we have to be always the least or no leverage company. I would Say we have to try our best but we have enough head in case we require we get an opportunity, we will grab it. We don’t want to be extremely aggressive because your company is going at 15, 20% CAGR, 25% CAGR from last 25 years. We are growing and the way we are growing, we will be growing. But we want to be very extremely prudent on our thought, on our values. Yes, my capex is very low because we feel that we are very efficient.
That is also one of the strength of sham metallic. And we are adding lot of new projects to cut all the cost. We increase the margins, we are increasing more and more efficiency in our existing businesses. We are trying to learn and learn more from the present tools available how to further enhance more exercise in bringing more value to the company. And yes, once the market turns around, we see everything is fine, things will improve more for the better. But what you are seeing is the worst. What the numbers you are seeing is the worst, you know, in today’s time.
But I’m 100% sure with the time it will further improve with the varieties of new businesses. New metal, new value addition, the kind of varieties of product mix on the sustainable part. What we are developing, we’ll see a lot of changes happening in the time. Okay, thanks.
Rajesh Majumdar
Thank you very much.
operator
Thank you. Ladies and gentlemen. Anyone who wishes to ask a question may press the N1 on their touchstone telephone. The next question is from the line of Ruchith Agarwal from Unified Mutual Fund. Please go ahead.
Ruchit Agrawal
Hi sir, thank you for the opportunity. So, a couple of questions.
Ruchit Agrawal
So on the coking coal bit we’ve.
Ruchit Agrawal
Seen prices move up materially as compared to the last quarter. Any margin headwinds that we can expect from the same. Although we’ve seen steel prices also move up. Anything that we can expect in the.
Brij Bhushan Agarwal
Next quarter definitely it is very volatile cooking coke and also we have a cooking. You know, we have our own coke oven plant. Your company SHA Metallic is definitely going to gain over the price on the delta side from the coking coke coal conversion point of view. And prices are looking little strong and firm for next quarter also. But it is too early for me to share because you know, you never know how it turns around as well. So yes, overall I’m extremely positive and we look forward we’ll be able to play more decent in the time to come.
Okay, that helps. Sir, Sir.
Ruchit Agrawal
And on the stainless steel bed, if you could help with the capacity commissioning timelines over next year and also this quarter we’ve Seen the EBITDA per ton for the stainless move up materially. How if you could comment on the sustainability part of the same.
Brij Bhushan Agarwal
What we did, we just acquired Bitlo Top two years before and what we have done, we started a wiring, stainless steel wire bright facility. We went forward integration, we did a trial. We are expanding the capacity definitely on the long product side, the margins will improve day by day. Lot of new product innovation and development also is in the process. Few has been okay then fewer is in the process. So in the time to come. Yes. Once you ramp up your production on the long product side of the existing stainless steel, you go more value added, big things become more decent.
And and from the new project which is coming up in Odisha, it’s a huge project. You know we are talking of half a million, more than half a million flat rolled product where you know, world class, where we have our own alloy, we have our own power, we have our own steel. We expect that by end of next year we should be able to commission the plant and there’s a lot of downstream activities, you know, a lot of value additional REDMI vli, lot of value additions that you know we are lining up that in the time to come we should be able to create a long team, long term supply chain value addition.
Ruchit Agrawal
Okay, got it.
Ruchit Agrawal
Sir. Sir.
Ruchit Agrawal
And last question. On the steel bit we’re seeing the color coated sheet move up basically double in capacities. How is our expansion efforts going on in the parallel flange beam sp front.
Brij Bhushan Agarwal
Flange beam is little bit, I would say on the flange beam side it is little bit on the. Not very aggressive. I think we will, we will be doing some kind of a modification on this section because there’s a lot of challenges coming up because we are trying to create a lot of products in our existing facility of the flat product where we’ll be doing lot of fabrications and all also. So I think it is too early for me to comment but maybe next few weeks we’ll be able to discuss more in better.
Ruchit Agrawal
Okay, sure, that helps.
Ruchit Agrawal
Thank you and wish you all the best.
Brij Bhushan Agarwal
Thank you.
operator
Thank you. Ladies and gentlemen, anyone who wishes to ask a question may press star N1 on the Touchstone telephone.
operator
It’s five o’ clock dear. I have my another meeting.
operator
Thank you. And ladies and gentlemen, that was the last question for today. I now hand the conference over to Mr. Omkar Bhagwe from Muft in time for closing comments. Over to you.
Omkar Bagwe
Yeah.
Omkar Bagwe
Thank you everyone for joining us on call today. I hope the management was able to answer all your queries today. I also like to thank the management for sparing the time and joining the call.
Omkar Bagwe
Today we are MUFG in Time Investor.
Omkar Bagwe
Relations Advisors to Sham Metallics and Energy Limited.
Omkar Bagwe
For any queries, please feel free to reach out to us.
Omkar Bagwe
Thank you, everyone.
Deepak Agarwal
Thank you. Thank you, everyone.
operator
Thank you on behalf of Sham Metallics and Energy Limited. That concludes this conference. Thank you for joining us. And you may now disconnect your lines. Thank you.
Deepak Agarwal
Okay.