Posted on 18 Nov 2022
Rama Steel Tubes (RSTL) expects its 30,000 tonnes/year capacity expansion at Khopoli to be commissioned by year-end, as will its new 20,000 t/y Nigeria-based plant, the Indian pipemaker says.
The firm announced the projects last December and January respectively (see Kallanish passim). Once completed, the producer will have an overall tubemaking capacity of 300,000 t/y.
The group is also in the process of modernising its Sahibabad plant, with a major goal of de-bottlenecking operations, which will result in increased yield per tonne of finished product. The first phase of this work will be completed by year-end.
Backward integration efforts at the plant in Anantpur District, Andhra Pradesh, involving the installation of cold rolling and galvanizing lines, will lead to an in-house raw material support of 50,000 t/y in the coming years, Rama says.
In the first half of the fiscal year through March 2023 Rama’s sales surged 68% on-year to 78,609t. Revenue rose 75% to INR 59,370.13 lakhs ($72.8 million) but net profit fell 36% to INR 932.52 lakhs due to higher costs.
“The announcement of huge government projects like UPPCL, Jal Shakti Abhyaan in the infrastructure sector and various public sector projects has boosted demand for our products significantly,” Rama says in a note seen by Kallanish. “We are also in the process of entering into certain niche segments like supply of steel pipes and tubes to city gas distribution and solar energy power generation units.”
The firm plans to allocate at least 25% of production capacity to cater to government sector demand in the coming years. These projects have an Ebitda margin of 9-10% and will therefore significantly improve overall margins, the firm concludes.
Rama produces ERW black pipe from 15-200mm diameter pipe and 15-150mm GI pipe in light, medium and heavy sizes.
Source:Kallanish
