Vibhor Steel Tubes Limited — Q3 FY26 earnings call

Call held 19 Feb 2026

Management summary

Vibhor Steel reported a strong Q3 FY26 with revenue up 21% YoY to ₹301 crores, driven by the ramp-up of its Jharsuguda plant. The company is actively expanding capacity, including new galvanizing lines, to meet high demand for its new, higher-margin products like Crash Barriers and Transmission Line Towers. While new products show significant potential and are expected to contribute 20% of FY26 revenue, certification challenges for some segments remain a watch item.

Highlights

  • Q3 FY26 revenue grew by 21% year-on-year to ₹301 crores, driven by the Jharsuguda plant's performance.

  • Overall revenue for the nine months ended December 31, 2025, increased by 15% year-on-year to ₹814 crores.

  • Jharsuguda plant's galvanizing capacity has reached its maximum, prompting the installation of a second galvanizing line to cater to new products.

  • New products like Crash Barriers, Transmission Line Towers, and Monopoles are expected to achieve significantly higher EBITDA margins (4.5% to 10%) compared to pipes (3.5-3.8%).

  • The company has secured order inquiries for over 2000 tons, indicating strong demand for its products.

Concerns

  • Some new products, particularly Transmission Line and Pole divisions, face challenges in terms of certification, potentially slowing their ramp-up.

  • Capacity constraints have led the company to regret some orders, highlighting the need for rapid capacity expansion.

Key financials

4 periods

Q3 FY25

  • Revenue
    ₹247.25 Cr

Q3 FY26

  • Revenue
    ₹301 Cr
    YoY +21%

9M FY25

  • Revenue
    ₹708 Cr

9M FY26

  • Revenue
    ₹814 Cr
    YoY +15%

What they filed

Q1 FY27: revenue up 27.2%, net profit down 38.5% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue236 247 288 231 282 +19%302 +22%335 +16%294 +27%
EBITDA7 10 11 10 9 +31%9 −8%15 +38%12 +19%
Net profit1 3 4 3 1 +60%2 −52%3 −42%2 −39%
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.

Order book

medium confidence

Pipeline

deal pipeline tcv

Order inquiries for over 2000 tons

The company has strong order inquiries, exceeding current capacity, leading to some regrettable order rejections.

Source: Prepared remarks

Capital allocation

high confidence
  • Capex ₹10 Cr New plan — machineries for Crash Barriers and extra galvanizing tanks
    • Machineries for Crash Barriers and extra galvanizing tanks ₹10 Cr
    we are going to incur in FY '26 around about Rs. 10 Cr and extra CAPEX by buying all the machineries for Crash Barriers and buying the extra galvanizing tanks.

Guidance & targets

Capacity

  • Jharsuguda Capacity Utilization Capacity · next year (FY27) · High confidence 30-40%
    we shall be able to complete 30%-40% in the next year

    — Vibhor Kaushik

  • Jharsuguda Capacity Utilization Capacity · year after (FY28) · High confidence 60%
    and then 60% subsequently in the year after.

    — Vibhor Kaushik

Product Mix

  • Revenue share from new products (non-pipe) Product Mix · this year (FY26) · High confidence 20%
    it will be 20% we will have from all the other products, Crash Barrier, Monopoles and Transmission Line Towers and also Pole.

    — Vibhor Kaushik

Profitability

  • EBITDA Margin for Pipe Profitability · ongoing · Medium confidence 3.5-3.8%
    If 3.8 or 3.5, EBITDA margins in pipe will be 4.5 in Crash Barrier, over 5 in Transmission Line and Monopole could be as much as 10%.

    — Vibhor Kaushik

  • EBITDA Margin for Crash Barrier Profitability · ongoing · Medium confidence 4.5%

    — Vibhor Kaushik

  • EBITDA Margin for Transmission Line Profitability · ongoing · Medium confidence >5%

    — Vibhor Kaushik

  • EBITDA Margin for Monopole Profitability · ongoing · Medium confidence ~10%

    — Vibhor Kaushik

Capex

  • FY26 Capex Capex · FY26 · High confidence ₹10 crores
    we are going to incur in FY '26 around about Rs. 10 Cr and extra CAPEX by buying all the machineries for Crash Barriers and buying the extra galvanizing tanks.

    — Vibhor Kaushik

  • FY27 Capex Capex · FY27 · Medium confidence ₹5 crores
    but to the tunes of Rs. 5 Cr or so next year and onwards.

    — Vibhor Kaushik

What to watch in Q4 FY26

Jharsuguda Capacity Utilization

next year (FY27)
Current 21% (Q3 FY26)
Target Progress towards 30-40% (FY27 target)

Why it matters

Tracking this will indicate the pace of ramp-up and revenue contribution from the new plant.

We are expecting it to reach 30%-40% of the utilized... So, it is very on the safer side to say that we shall be able to complete 30%-40% in the next year

Risks & concerns

  • Certification challenges for new products

    medium

    Transmission Line and Pole divisions face challenges in terms of certification, which is being aggressively pursued across states.

    Transmission Line and Pole is very recent in our division. Although they are showing a lot of potential, but it has a lot of challenges in terms of certification. So, we have accelerated in a very big manner in quarter 3 in terms of getting ourselves registered everywhere.

    Management acknowledged

  • Capacity constraints leading to missed orders

    medium

    Current capacity is full, leading to the company regretting some orders, necessitating further expansion.

    We have ordered one extra machine for Hyderabad and one extra machine for Jharsuguda because we have captured so much of the market that unfortunately some of the orders we have to outrightly regret because our capacity is full.

    Management acknowledged

Q&A highlights

5 direct
Metal Crash Barrier product potential, margins, and impact on revenue/EBITDA Direct
We started Metal Crash Barrier very recently compared to our Pipe production which has been happening for 20 years. We started with one galvanizing tank in Hyderabad which was common between Pipe and Crash Barrier or Metal Guardrail, its second name. We realized that one galvanizing tank is not enough. We installed a separate dedicated to Metal Crash Barrier which received its full capacity as soon as it started. Similarly, same thing happened in Jharsuguda as well. We installed one big tank of 13 meter which is one of its own kind galvanizing tank... Our installed capacity was around about 1000 ton in Hyderabad, about 1000 tons in Jharsuguda. We have ordered one extra machine for Hyderabad and one extra machine for Jharsuguda because we have captured so much of the market that unfortunately some of the orders we have to outrightly regret because our capacity is full.

Provides detailed insight into the high growth potential, capacity constraints, and expansion plans for the high-margin Metal Crash Barrier segment, including specific capacity figures and lead times for new machines/tanks.

Asked by Disha Shah

New upcoming projects or clients apart from Jindal, especially government projects Direct
Jindal is, we are associated with Jindal. It is a long time agreement for the past 20 years for pipe. The product pipe is extensively for Jindals, although we also do export in Maharashtra. At the moment, it is about 80% of our revenue that comes from Jindal... Directly or indirectly, most of the products that we are doing is a government project. Metal Crash Barrier is totally and completely taken up mostly by the government. Transmission Line Towers are taken up by state electricity board. So, we have already catered to a few electricity boards, Sikkim very recently.

Clarifies the company's client diversification strategy, indicating a significant reliance on government and large private players for new product lines, while Jindal remains a key client for pipes.

Asked by Disha Shah

CAPEX plans for FY26 and FY27 Direct
we are going to incur in FY '26 around about Rs. 10 Cr and extra CAPEX by buying all the machineries for Crash Barriers and buying the extra galvanizing tanks. And the year ahead, we will gauge it, but give or take, it shall be somewhere. It is difficult to say about the future, but to the tunes of Rs. 5 Cr or so next year and onwards.

Quantifies the company's planned capital expenditure for the next two fiscal years, detailing the investment in capacity expansion for high-growth products.

Asked by Aditi Shah

Timeline for Sundargarh (Jharsuguda) unit to reach full capacity utilization Direct
We are expecting it to reach 30%-40% of the utilized... So, it is very on the safer side to say that we shall be able to complete 30%-40% in the next year, and then 60% subsequently in the year after. If the momentum continues to be like this, and there are all the signs and all the signals, the requirement is there, the order bookings are there, so we shall be able to reach capacity utilization up to 60% in 2 years.

Provides a clear timeline and targets for the ramp-up of the Jharsuguda plant's capacity utilization, which is crucial for future revenue growth.

Asked by Yash Nisar

Expected revenue share from new products (Monopoles, Octagonal Poles, Transmission Lines) in the next 12 months and their margins Direct
it will be 20% we will have from all the other products, Crash Barrier, Monopoles and Transmission Line Towers and also Pole... EBITDA margins in all of it is fairly improved. If 3.8 or 3.5, EBITDA margins in pipe will be 4.5 in Crash Barrier, over 5 in Transmission Line and Monopole could be as much as 10%.

Outlines the expected product mix shift towards higher-margin new products, detailing their anticipated contribution to revenue and specific EBITDA margin profiles.

Asked by Rahul Kumar

3 min read 6 chapters

Detailed narrative

Strong Q3 FY26 Performance Driven by Jharsuguda Plant

Vibhor Steel Tubes Limited reported a robust Q3 FY26, with revenue reaching ₹301 crores, marking a significant 21% year-on-year increase compared to ₹247.25 crores in Q3 FY25. For the nine months ended December 31, 2025, the company's overall revenue grew by 15% year-on-year to ₹814 crores, up from ₹708 crores in the previous year. This growth is primarily attributed to the successful ramp-up and increasing potential of the Jharsuguda plant, which has started to streamline its operations and gain market presence in the Northeast region.

Strategic Shift Towards Higher-Margin New Products

The company is strategically expanding its product portfolio beyond traditional pipes to include higher-margin offerings such as Highway Crash Barriers, Transmission Line Towers, Pole divisions (Octagon, High Mast, Conical), and Monopoles. Management expects these new products to contribute approximately 20% to the total revenue in FY26, with their share increasing further. These products also boast significantly better EBITDA margins: Crash Barriers at 4.5%, Transmission Line at over 5%, and Monopoles potentially reaching 10%, compared to pipe margins of 3.5-3.8%.

Aggressive Capacity Expansion to Meet Demand

Vibhor Steel is actively investing in capacity expansion, particularly for its galvanizing operations, which are critical for most of its products. The galvanizing capacity at the Jharsuguda plant has already reached its maximum, prompting the installation of a second galvanizing line, expected to be operational within two months. The company is also considering a third galvanizing tank if momentum continues. Additionally, extra machines for Crash Barriers have been ordered for both Hyderabad and Jharsuguda plants, as current capacity is insufficient to meet the strong order inquiries of over 2000 tons.

FY26 and FY27 Capex Plans

The company plans a capital expenditure of approximately ₹10 crores for FY26, primarily allocated to acquiring new machinery for Crash Barriers and additional galvanizing tanks. For FY27, a capex of around ₹5 crores is anticipated. These investments are crucial for supporting the expansion of the new product lines and enhancing overall production capabilities, reflecting a vigilant approach to capital deployment based on market demand.

Diversified Client Base with Government Focus for New Products

While Jindal continues to be a long-standing partner, contributing about 80% of the pipe revenue, Vibhor Steel is diversifying its client base for new products. Most of the new offerings, such as Metal Crash Barriers and Transmission Line Towers, are primarily taken up by government projects (e.g., state electricity boards, Sikkim) or large private companies (e.g., NTPC, mining divisions). This strategy aims to leverage India's infrastructure growth and reduce over-reliance on a single client for its expanding portfolio.

Jharsuguda Plant Utilization Targets and Certification Challenges

The Jharsuguda plant, which currently operates at 21% of its installed capacity (Q3 FY26), is projected to reach 30-40% utilization in the next fiscal year (FY27) and further increase to 60% in the year after (FY28). However, new divisions like Transmission Line and Pole face significant challenges in terms of certification and registration across various state departments. The company is aggressively working to get these products certified and registered to unlock their full market potential.

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