Rajratan Global Wire Limited — Q4 FY26 earnings call

Call held 22 Apr 2026

Management summary

Rajratan Global Wire Limited reported a strong Q4 FY26 with record sales tonnage and 18% YoY volume growth, despite geopolitical challenges and supply chain disruptions. While Q4 EBITDA margins were impacted by un-passed raw material and energy cost increases, management confirmed these have been passed on in Q1 FY27. The company is pursuing capacity expansions in Chennai and a new steel cord project, alongside aggressive export growth targets for FY27.

Highlights

  • Highest ever sales tonnage achieved, totaling over 133,000 tons from three locations.

  • Consolidated sales volume grew by 18% year-on-year.

  • Price increases of INR10,000 per ton for raw materials have been successfully passed on to customers in the current quarter.

  • Robust demand from customers in India, Thailand, and globally continues.

Concerns

  • EBITDA margin in Q4 FY26 was lower than targeted due to a sudden INR10,000 per ton increase in steel prices (Jan-Mar) which could not be immediately passed on.

  • Energy price and availability issues also negatively impacted Q4 EBITDA margins.

  • Receivable cycle increased due to US exports, as the US company pays 30-60 days after receiving material, adding to working capital costs.

  • Uncertainty regarding PLI benefits, as initial production targets were missed, and approval for changes is pending.

Key financials

  1. Sales Volume 1,33,000 tons +18%YoY
  2. Raw Material Price Increase ₹10,000/ton
  3. Raw Material Consumption 63%
  4. India Market Share (Tyre) 42%

What they filed

Q1 FY27: revenue up 28.7%, net profit up 64.3% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue245 218 251 247 294 +20%302 +39%314 +25%318 +29%
EBITDA38 26 33 31 40 +5%40 +54%29 −12%42 +35%
Net profit19 9 15 14 21 +11%21 +133%15 +0%23 +64%
How to read this

₹ crore, as filed. The percentage beside a figure is the change against the same quarter a year earlier — never the quarter before, which would make every seasonal business look like it collapses and booms each year.

Segment breakdown

  • India Sales Volume Growth
    19% Growth
  • Thailand Sales Volume Growth
    17% Growth
  • India Exports (FY26)
    9,000 tons Volume2.5% Growth
  • Chennai Capacity Utilization (March)
    85% Utilization
  • Thailand Capacity Utilization (Q4 Exit)
    85% Utilization
  • Indore Capacity Utilization
    90% Utilization

Capital allocation

high confidence
  • Capex Capex disclosed
    • Steel cord project ₹70 Cr
    • Chennai capacity expansion to 60,000 tons ₹25 Cr
    In the steel cord, we have already invested around INR55 crores, I think INR45 crores to INR50 crores and we will require another INR25 crores to complete that capex. And Chennai this year will be close to INR25 crores to complete the capacity to 60,000 tons.
  • Debt Debt disclosed Cost 7%
    • Repayment Repaid term loan ₹50 Cr
    Yes, it is good to borrow at 7%, 7.5% and invest in a profitable business, so working capital borrowing will continue.

Guidance & targets

Volume

  • Consolidated Volume Growth Volume · FY27 · High confidence 17-18%
    So I can say that this year should be another growth year for Rajratan and we target to grow our business in volume by around 17% to 18% in the current year also.

    — Sunil Chordia

  • Thailand Volume Growth Volume · FY27 · Medium confidence 10-14%
    Thailand we are not expecting 20%, we are expecting around 10% to 14% because there is a capacity constraint in Thailand. We are doing some debottlenecking, so Thailand from current year volume which is close to 51,000 will grow to 55,000 to 56,000. That is why I am saying 10% to 11% growth in volume in Thailand.

    — Sunil Chordia

  • Consolidated Total Sales Volume · FY27 · Medium confidence 155,000 tons
    So next year you can estimate a 155,000 tons of total sales if things remain normal globally.

    — Sunil Chordia

  • USA Export Growth Volume · FY27 · Medium confidence 30%
    We look at the transportation cost, capacities available in different plants. But we have a plan to grow around 30% in North America I can tell you.

    — Sunil Chordia

  • Europe Export Growth Volume · FY27 · Medium confidence 50%
    And some growth in Europe, which will be around 50% and Southeast Asia 10%, 15% because we were supplies in South Asia for many, many years.

    — Sunil Chordia

Margin

  • Consolidated EBITDA Margin Margin · Ongoing · High confidence 13.5-14%
    You can continue to assume that we will be able to maintain this EBITDA level 13.5% to 14% safely.

    — Sunil Chordia

Capacity

  • Chennai Plant Capacity Capacity · Q2 FY27 · High confidence 60,000 tons

    From 30,000 tons today

    That is why we decided to put in the money for balance equipment and some equipments have started arriving and we will become a 60,000 tons capacity plant by second quarter of this financial year.

    — Sunil Chordia

New Product

  • Steel Cord Project Trials Start New Product · Q2 FY27 · High confidence Start trials
    But now that work is over and machines are getting installed and we will be able to start trials in the second quarter of that product also.

    — Sunil Chordia

  • Steel Cord Project Peak Revenue New Product · 2 years · Medium confidence INR150 crores
    Peak revenue will be INR150 crores which will take at least 2 years to reach.

    — Sunil Chordia

Exports

  • India Exports Volume Exports · FY27 · Medium confidence 15,000 tons

    From 9,000 tons today

    Next year probably we are expecting to touch about 15,000 tons of export from India.

    — Yashovardhan Chordia

Taxation

  • PLI Scheme Benefit Taxation · 5 years · Low confidence INR40-50 crores
    Total quantum will be INR40 crores to INR50 crores in 5 years' time.

    — Sunil Chordia

Realization

  • Average Realization Realization · FY27 · High confidence Above INR90,000

    From INR84,000-86,000 today

    Yes. So is it fair to assume that the 84,000, 85,000, 86,000 average realization would improve above 90,000 for this FY27? Sunil Chordia: Yes.

    — Sunil Chordia

What to watch in Q1 FY27

Chennai Capacity Expansion Completion

Q2 FY27
Current 85-90% utilization (March), 30,000 tons capacity
Target 60,000 tons capacity operational

Why it matters

Crucial for meeting robust demand and driving India's volume growth targets.

That is why we decided to put in the money for balance equipment and some equipments have started arriving and we will become a 60,000 tons capacity plant by second quarter of this financial year.

Risks & concerns

  • Raw Material Price Volatility

    high

    A sudden increase of INR10,000 per ton in steel prices from January to March impacted Q4 EBITDA margins as it could not be immediately passed on.

    Management acknowledged

  • Geopolitical Situation and War

    medium

    Global businesses and supply chains are affected by geopolitical situations and war, though the company has performed well.

    Management acknowledged

  • Energy Price and Availability

    medium

    Difficulty with energy availability and price also affected EBITDA margins in Q4 FY26.

    Management acknowledged

  • Shipping Disruption

    medium

    Disruption in shipping, especially from the Thailand plant, has been observed, leading to challenges in material delivery times.

    Management acknowledged

  • Increased Receivable Cycle

    medium

    The receivable cycle has increased due to US exports, as the US company pays 30-60 days after receiving material, impacting working capital.

    Management acknowledged

  • PLI Scheme Uncertainty

    medium

    PLI benefits are uncertain as the company missed production targets for the first two years and is awaiting approval for changes to the scheme.

    Management acknowledged

  • Competitive Intensity and Pricing Pressure

    medium

    Competition is high, with excess capacity in the market and pricing pressure, though management believes competitors are already operating at a loss.

    Management acknowledged

  • Potential Auto Sales Slowdown

    low

    Analysts raised concerns about a potential slowdown in auto sales due to supply chain issues and price hikes, but management has not seen a negative impact yet.

    Analyst acknowledged

Q&A highlights

7 direct
Export Business Opportunities (Region-wise and Non-Tyre Segment) Direct
Because of volatility, to be honest, the only impact that we have seen till now is disruption in shipping, especially from our Thailand plant. But overall, the development of export market remains robust for us. There are many companies that have already approved us in Europe and we are under regular supplies to them since last six months. ... I would say 70% of the efforts and development is happening in tyre segment in terms of number of counters and number of plants. But today, non-tyre segment volume is also substantial.

Clarifies the impact of global volatility on exports and the strategic focus on both tyre and non-tyre segments for growth.

Asked by Sanjay Shah

Chennai Plant Expansion and Low Margin Customers Direct
So, last quarter Chennai utilized capacity almost 85% to 90%. If you look at their exit rate against 30,000 tons capacity, they have been producing 2,200 tons to 2,300 tons per month. That is why we decided to put in the money for balance equipment and some equipments have started arriving and we will become a 60,000 tons capacity plant by second quarter of this financial year. ... As long as the product is giving us some contribution, we want to continue with our high market share.

Explains the rationale behind Chennai's capacity expansion and the strategy for catering to customers, including those with lower margins, to maintain market share.

Asked by Sanjay Shah

Margin Reversal and Raw Material Price Pass-on Direct
Right now, this year, the price that increased until March has been passed on, whether it is the steel price or it is other consumables or even energy prices. And currently we are seeing that there is a pressure on the dispatches. ... It will be little more because in percentage we will be able to maintain gross margin. So on absolute numbers, because prices have gone up, we will be able to do that. Not an issue. So I don't think any issue in this quarter.

Confirms that the raw material price increases have been passed on, indicating a recovery in gross margin percentage for the current quarter (Q1 FY27).

Asked by Preet Pitani

Other Expenses and USA Subsidiary Costs Direct
Look, the other expenses, it is not Thailand other expenses. We have now one more 100% subsidiary which is getting merged in this balance sheet, that is USA, Rajratan USA. So there is a cost of around INR30 crores which is for six months wherein we have been supplying to USA on a FOB basis because the import duty in USA is on the FOB cost of the product and the US company pays for the shipping cost and logistics cost.

Clarifies the source of increased 'other expenses' as the new USA subsidiary, providing transparency on the cost structure related to US exports.

Asked by Preet Pitani

PLI Scheme Status and Benefits Partial
Yes. As I said, we are knocking the doors of Steel Ministry. We are also making representations to Commerce Ministry who is overall in charge of the PLI. They all hear us, but nobody is giving assurance. I think it will take some time before I can confidently say that we are getting PLI. But we could not achieve first year target targeted production as committed to them and second year targeted production was also not achieved because first year was missed. ... So we have requested for change in the ladder. If that is approved, we'll get PLI. Otherwise as of today, the question mark is there on the PLI.

Highlights the uncertainty and challenges in securing PLI benefits due to missed production targets and ongoing discussions with ministries.

Asked by Preet Pitani

Steel Cord Project Details and Margins Direct
The total capacity of this plant is 10,000 tons a year and the generation at current level of pricing, the top line possible from this investment is around INR150 crores. ... Right now, what others are selling, the current sales and if we look at financials, the EBITDA margin as of today are around 20%. We will have to see going forward how it works out.

Provides specific details on the new steel cord project's capacity, revenue potential, and targeted EBITDA margins, indicating a strategic move into a niche, higher-margin product.

Asked by Vinit Thakur

Competitive Intensity and Margin Maintenance Direct
If competition decides to further reduce the price, to our understanding they are already losing heavily at this price. If they decide to lose further, okay, I don't know. So very difficult to predict. Okay. But we are surviving and making this kind of margin in last 4 years at least. So competition is not new.

Addresses concerns about competitive pricing pressure and management's confidence in maintaining margins despite industry challenges.

Asked by Preet Pitani

Capitalization of Work-in-Progress (WIP) Direct
Yes, so by the second or third quarter of this year, everything will be capitalized. So you will see a very small number in WIP. All this will be capitalized and up and running.

Clarifies the timeline for capitalizing current WIP, indicating that significant assets will become operational and contribute to revenue soon.

Asked by Saket Kapoor

3 min read 6 chapters

Detailed narrative

Q4 FY26 Performance and Market Dynamics

Rajratan Global Wire Limited achieved its highest ever sales tonnage in Q4 FY26, with a consolidated sales volume increase of 18% year-on-year, totaling over 133,000 tons. Despite this, the targeted EBITDA margin was not met due to a sudden INR10,000 per ton increase in steel prices from January to March, which could not be immediately passed on to customers. Energy price and availability issues also contributed to the margin pressure. However, management confirmed that these price increases have been successfully passed on in the current quarter (Q1 FY27), and robust demand continues across India, Thailand, and global markets.

Capacity Expansion and Utilization

The company's Chennai plant utilized 85-90% of its capacity in March 2026. To meet growing demand, Rajratan is investing INR25 crores to double Chennai's capacity to 60,000 tons per year, expected to be operational by Q2 FY27. The Indore plant continues to operate at 90% capacity utilization, and Thailand's plant also saw 85-90% utilization in Q4 FY26. Overall, the company aims for a consolidated total sales volume of 155,000 tons in FY27, representing a 17-18% growth.

Export Market Performance and Strategy

Exports from India grew by 250% in FY26, with a volume of approximately 9,000 tons. For FY27, the company targets to increase India's export volume to 15,000 tons. Regionally, Rajratan plans for 30% growth in North America and 50% in Europe (from a low base), while Southeast Asia is projected to grow by 10-15%. Shipping disruptions, particularly from Thailand, have been noted, but overall export market development remains robust, with new customer approvals in Europe and strong demand in the American market.

Capital Expenditure and New Vertical Development

Rajratan is investing INR70 crores in a new steel cord project, with INR50 crores already invested and INR20 crores remaining. This plant will have a capacity of 10,000 tons per year and a peak revenue potential of INR150 crores, expected to be reached within two years. Production trials for the steel cord project are anticipated to begin in Q2 FY27. This new vertical, while similar to existing wire drawing products, represents an effort to identify new growth areas and expand the product portfolio into niche markets like conveyor belts.

Taxation, Working Capital, and Debt Management

The company's effective tax rate was low due to income tax exemptions in Thailand for sales exceeding 36,000 tons, resulting in a 13.9% effective rate for its BOI privileged company. The receivable cycle has increased due to US exports, as the US subsidiary's payment terms extend to 30-60 days after material receipt, impacting working capital. Rajratan repaid INR50 crores of term loan in the current year and expects long-term borrowing to be less than INR50 crores, while working capital borrowing will continue at 7-7.5%.

PLI Scheme and Margin Outlook

The company is facing uncertainty regarding benefits from the PLI scheme, as it missed production targets in the first two years and is currently negotiating for changes. If approved, the PLI scheme could provide INR40-50 crores over five years, based on 8% of incremental sales. Despite competitive intensity and raw material volatility, management is confident in maintaining a consolidated EBITDA margin of 13.5-14% safely, noting that competitors are already operating at lower profitability levels.

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