Ratnamani Metals & Tubes Limited — Q2 FY26 earnings call

Call held 10 Nov 2025

Management summary

Ratnamani reported a strong quarter on a consolidated basis, largely fueled by the momentum in its subsidiaries RTL and RFSS. While the domestic line pipe market remains subdued, the company is successfully pivoting toward international markets (GCC and Europe) and high-value segments like nuclear power. Significant capacity expansions in Orissa and Saudi Arabia are on track to support a major revenue scale-up over the next three years.

Highlights

  • Consolidated revenue grew 23% YoY to ₹1,191 crores, driven by strong subsidiary performance.

  • Standalone revenue stood at ₹940 crores, representing a modest 5% YoY increase due to softer input prices.

  • RTL subsidiary revenue surged 40% YoY to ₹95.6 crores with EBITDA margins improving to 13%.

  • RFSS (Finow) subsidiary reported ₹110 crores in quarterly revenue with a ₹500 crore order book for nuclear projects.

  • Standalone order book reached approximately ₹2,000-2,050 crores as of November 1, 2025.

  • Management set a consolidated revenue target of ₹7,000-7,500 crores within the next 2-3 years.

  • Standalone EBITDA margins are expected to be maintained in the 16% to 18% range.

Concerns

  • European Tariff/Quota Changes

Key financials

  1. Consolidated Revenue ₹1,191 Cr +23%YoY
  2. Standalone Revenue ₹940 Cr +5%YoY
  3. Standalone Order Book ₹2,050 Cr
  4. Carbon Steel Order Inflow ₹750 Cr

What they filed

Q1 FY27: revenue down 30.2%, net profit down 62.8% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue898 1,294 1,575 1,062 940 +5%794 −39%893 −43%741 −30%
EBITDA149 214 292 192 140 −6%136 −36%122 −58%80 −58%
Net profit102 146 225 145 108 +6%88 −40%93 −59%54 −63%
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

Share of Revenue
₹205.6 Cr Total
  • RFSS (Finow Spooling) ₹110 Cr 53.5%
  • RTL (Ravi Technoforge) ₹95.6 Cr 46.5%

Guidance & targets

Revenue

  • Consolidated Revenue Revenue · next 2-3 years · Medium confidence ₹7,000-7,500 crores
    So, anywhere between 7,000 to 7,500 on consolidated basis is what we should look in another two to three years.

    — Manoj Sanghvi, CEO

  • RFSS Annual Revenue Revenue · FY26 · High confidence ₹300+ crores
    We maintain our INR 300 crores plus revenue guidance for the full year for RFSS.

    — Manoj Sanghvi, CEO

  • RTL Annual Revenue Revenue · FY26 · High confidence ₹360-380 crores

    Previously 20% growth → ₹360-380 crores

    So, this year may be anywhere between INR 360 crores to INR 380 crores.

    — Manoj Sanghvi, CEO

Margin

  • Standalone EBITDA Margin Margin · FY26 · High confidence 16-18%
    we expect that a strong focus on operational efficiency and cost control should help maintaining EBITDA in the range of 16% to 18%.

    — Manoj Sanghvi, CEO

Capacity

  • Saudi Project Trial Production Capacity · December 2026 · Medium confidence Commencement
    And the Saudi project... we expect to start trial production by the end of next year, December 2026.

    — Manoj Sanghvi, CEO

Risks & concerns

  • European Tariff/Quota Changes

    high

    Rumors of increased tariffs or halved quotas in Europe starting Jan 1st; company is stocking inventory in anticipation.

    Management acknowledged

  • Subdued Domestic Demand

    medium

    Domestic line pipe tenders are currently underbidding and volume is not back to 2022-23 levels.

    Management acknowledged

  • Working Capital Volatility

    medium

    Nuclear project spools require rigid inspections, leading to lumpy revenue recognition and inventory buildup.

    Both acknowledged

Areas of evasion (2)

  • Explanation of the ₹200cr+ jump in Other Financial Assets
  • Specific volume breakup for seamless vs welded pipes

Q&A highlights

1 direct, 1 evasive
Domestic Demand and Order Book Sustainability Partial
Domestic demand is still... not to the level where we can see a substantial jump in the order book. We will continue to book orders as we did.

Highlights the ongoing weakness in the domestic line pipe market, making the company more dependent on export wins.

Asked by Vikas Singh, ICICI Securities

Sudden Jump in Other Financial Assets Evasive
I don't know.

A significant balance sheet item (jump from ₹12cr to ₹220cr) was left unexplained by the CEO during the call, which is a transparency concern.

Asked by Salil Desai, Marcellus Investment Managers

Margin Pressure in Specific Segments Direct
No, margin pressure is in one particular segment, which is, say, carbon steel line pipes, and that too water.

Identifies the specific area of competitive and pricing pressure, allowing investors to track segment-specific risks.

Asked by Radha, B&K Securities

2 min read 5 chapters

Detailed narrative

Subsidiary Momentum Drives Consolidated Growth

Ratnamani's consolidated performance was significantly bolstered by its subsidiaries, which now contribute a substantial portion of the top line. RTL (Ravi Technoforge) saw revenue grow 40% YoY to ₹95.6 crores, with EBITDA margins expanding from 9% to 13% due to operational efficiencies. RFSS (Finow) contributed ₹110 crores this quarter, and management is confident in achieving over ₹300 crores for the full year, backed by a ₹500 crore order book dedicated to the nuclear power sector.

Domestic Headwinds vs. Export Opportunities

The domestic market for line pipes remains subdued compared to the peaks of FY23, with management noting that current tenders are often underbid. However, the company is finding strong demand in the GCC region, particularly in Saudi Arabia and Abu Dhabi. To mitigate domestic weakness, Ratnamani is also pioneering new products like hydrogen-compliant carbon steel welded pipes for the European market, though it faces potential tariff risks in that region starting January 2026.

Aggressive Capacity Expansion Roadmap

The company is in the midst of a major CAPEX cycle aimed at reaching ₹7,500 crores in consolidated revenue. Phase-I of the Orissa plant is commissioned, with Phase-II (coating plant) expected by March 2026. Furthermore, a new stainless-steel cold finishing line in Saudi Arabia is slated for trial production by December 2026. These projects, along with doubling capacity at RFSS to 4,000 tons, are the primary pillars for the company's 2-3 year growth outlook.

Nuclear Sector as a High-Margin Anchor

The RFSS subsidiary is currently fully booked for nuclear power projects, which command higher margins. Management targets a blended EBITDA margin of 20-22% for this business as it scales. While the execution cycle is lumpy due to stringent nuclear authority inspections, the long-term visibility is strong, and the company plans to eventually diversify this capacity into thermal power and oil & gas spools.

Financial Discipline and Margin Guidance

Despite softer input prices and a changing product mix that kept standalone revenue growth at 5%, Ratnamani maintained its standalone EBITDA margin guidance of 16-18%. The company saw a significant decline in working capital requirements this quarter, primarily because orders for water pipes (which have longer cycles) decreased. Management expects consolidated margins to settle in the mid-teens as new capacities stabilize.

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