Companhia de Saneamento do Parana Sanepar
BOVESPA:SAPR4
Companhia de Saneamento do Parana Sanepar
In the heart of Brazil, Companhia de Saneamento do Paraná, commonly known as Sanepar, stands as a vital player in the urban infrastructure landscape. Founded in 1963, this company has woven itself into the public fabric of Paraná, a state marked by its diverse and growing population. Sanepar is responsible for providing essential water and sewage services to millions, covering over 340 cities and towns across the state. Its operations are deeply embedded in the Paraná region, with the company's infrastructure sprawling across an expansive geographical area. Sanepar’s role is pivotal; by managing the purification, distribution, and collection processes, it ensures not just the public health but also supports economic activities that are water-dependent.
Sanepar’s business model is built upon the provision of clean, safe water and effective wastewater management to both households and industrial clients. Revenue generation stems primarily from user fees, which are regulated by state authorities to ensure affordability and fairness. The company consistently invests in technological advancements and infrastructure development to enhance service quality and coverage, aiming to meet the escalating demands of population growth and urban development. Its financial health is closely monitored by stakeholders who are keenly aware of how water scarcity and environmental issues might impact its operations. While its services are indispensable, Sanepar also faces the perpetual task of balancing between operational efficiency, public accountability, and sustainable resource management. This careful balancing act keeps Sanepar at the forefront of Brazil’s efforts to modernize its utility services.
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Ladies and gentlemen, good day, and welcome to the Supreme Industries Q4 FY 2025 and Full Year 2024-'25 Earnings Conference Call, hosted by DAM Capital Advisors. [Operator Instructions] Please note that this conference is being recorded.
I now hand the conference over to Mr. Aasim Bharde from DAM Capital Advisors. Thank you, and over to you, sir.
Thank you, and good evening to everyone who has dialed in. We have with us the leadership team of Supreme Industries, who will take us through the quarter 4 and FY '25 performance and post which we'll open the forum for Q&A.
Thank you, and over to you, Mr. Taparia.
Thank you very much, Mr. Aasim. I'm M.P. Taparia, Managing Director of the Supreme Industry Limited. I along with my colleague, Shri P.C. Somani, Chief Finance Officer; and R.J. Saboo, Vice President Corporate Affairs and Company Secretary, welcome all the participants who are participating in the discussion of unaudited standalone and consolidated financial results for the quarter and year-end 31st March [indiscernible].
The standalone results and the consolidated results are already with you. I will give brief on company's product operating performance and other highlights. The company sold [indiscernible] back [ 74,500 ] plastic goods [indiscernible] and achieved net product turnover of INR 10,295 crores, review against sale of [ 68,39,701 ] tonnes and net product turnout of [ INR 10,022 ] crores in the previous year achieving volume and product value growth of about 5% and 3%, respectively. The consolidated operating profit and profit ARPU takes due under -- year under review amounted to INR 1,552 crores and between INR 961 crores as compared to [ INR 31,664 ] crore and [ INR 1,070 crores ] for the previous year, a decrease of 6% and 10% respectively. The business scenario of all the segment of the company for the year ended 31st March 2025 as compared to the previous year under. [indiscernible] pipeline system business grew by 6% in volume and 2% in [ EBITDA ].
Packaging Products segment grew 10% in volume and 13% in value term. Industry Products segment business [ grew ] by 1% in volume and remained a flat level in value term. Renewal product segment business [indiscernible] by 3% in volume and grew 1% in term. The overall turnover of value-added product increased to INR 4,060 crores compared to INR 3,248 crores in the previous year, achieving value growth of 8%. The company plans to spend about INR 21,100 crores towards CapEx during FY '26, including value term commitment of preceding year and acquisition of building and infrastructure business while we are in India. The [ deepest ] plant also includes setting a plant to [indiscernible] PVC profile and window facility for [indiscernible] and increasing capacity for PVC. CPG pipe [indiscernible] at various locations. CapEx also included additional new product SKUs and balance equipment and respective product union. [indiscernible] accrual. This year concluded a normal witness in our segment for the company, except plastic pricing system business, briefly due to much lower spending by central exchange government earn infrastructure compared to year -- FY '24 [indiscernible] several parts of the country, an extreme moral situation of aging price principle rate material rate for the company.
The prices of PVC has changed 14x since July 24 and severally impacted the plastic pricing industry. We are domestic economy-oriented company. I am to forecast for this year is you have above [indiscernible], which will boost crop production and contained inflation. The report is coming about INR crore, harvesting is quite encouraging. Our country economy is well poised to have high growth in the current year in spite of uncertain lower situation. The current global trend for crude price, which remained inbound at 65 to 70 [indiscernible] better level, which will help the dollar-rupee exchange rate remaining inbound without extreme depreciation of the rupee and the current [indiscernible], which is our principal raw material will also remain close to the current best level. Just the product made by the company will remain quite affordable.
The company also expects better volume growth in export market for product portfolio, given the tariff issued effect in other countries severely. The overall demand forecast for [indiscernible] sector is encouraging. The central government has [indiscernible] for increase in capital allocation in the budget for the year 2026 FY compared to money spent in the year FY '25 for augmenting [indiscernible] water supply. Country witnessed the growth of around 6% in volume and [indiscernible] and the company achieved a growth over 6% in volume during the year-end review. In this business, the current year [ argues ] well for the company on its performance compared to the previous year. The company has 45 plastic piping system in the division and plans to add 5 more system in the current year related to wage application, substituting a master material. The company continued despite portfolio with additional SKUs and system for various applications as required by our country growing economy.
To build the growth in demand for pricing products, the company initiated [indiscernible] not going to do brownfield expansion at existing [indiscernible] site, but also exploring inorganic growth opportunity. The company has signed member for more understanding with all Bihar Advanced Corporation, a global leader in Plastic Pipe fitting, April agreement, company will acquire all Bihar [indiscernible] in India and we exclude access to [indiscernible] leading pipeline cetology for India outside countries. The acquisition of [indiscernible] result in increasing the capacity of pipe [indiscernible] by 73,000 tonnes per annum being operated from 3 networking sites situated [indiscernible]. The acquisition and facilitate catering to dispute ADL or North and South India economically and efficiently with the cap incurred during the year under review, total recharge capacity of [indiscernible] 70,000 tonnes per annum [indiscernible] of [ 440,000 ] tonnes per annum we had on 31st March 2024 and actually reached -- sorry, actually reach 1 million tonnes by end of FY 2026.
The company putting up PVC profile manufacturing with 5,000 tonne annual capacity, a new acquire site along with window making facility at the same site. Our equity equipment have been ordered and worked at a site in full strength. A company expect to start sharing extender of the shelf customized window from July 2025. In gross [indiscernible], demand is now [ 15 way ] to the company from [indiscernible] product if we acting growing recognition of the company's superior quality and reliability. With substantial provision capacity and strong [indiscernible] delivery, the company is well positioned to meet the exchange and requirement of government contracts and expect continued business in this segment. Our equipment required for the manufacture of cross plastic also been installed and trial production underway. The overall demand for Plastic Pipe furniture [indiscernible] which is affecting the growth of plastic furniture industry in the country. The company plans to focus on growth from [indiscernible] of this segment is still quite low and opportunity for growth.
The company plans to launch 8 new model in the first quarter of year '25 to '26, which will result in overall growth in volume during fiscal year during FY '26. In Industry Component division, Automotive car, commercial [indiscernible] muted demand was better in the passenger [indiscernible] segment. Similarly, [indiscernible], air conditioning and cooler segment witnessed good growth. The washing machine segment witnessed improved demand. The focus of initiative of this dividend may mainly display the sector and customer base for business growth and mitigate the dependency on 2 large customers which is yielding actual results. The material and division performance and we renew where the industrial customer segment, which is effort of reaching to new customers and [indiscernible], growth in induction and [indiscernible] but good. The competing dividend experienced [indiscernible] with performance having short-term expectation. Witness from company, major customers, [indiscernible] to the expected level. Discussion for new [indiscernible] change with the most popular 14.2 kilos [indiscernible] early marketing companies at [indiscernible] their product portfolio.
The company have obtained certification for a high prices in [indiscernible] CNG application, making it a second company in India to offer Type 4 high-present cylinder. The effort position a division for growth opportunity, moving up the value chain. In Performance Packaging Division, the company remained focused on performance best product offering, imprest high-value segment penetration with a strong focus on end user need this use offers a customized product portfolio begin to meet demanding application requirements. The Protective Packaging Division is putting his continued effort to remain in the previous growth plan. The focus of the division continued to develop customized solutions keeping and employment in mind. The division has also expanding its [indiscernible] facility in terms of capacities and developing space to cater to the increasing opportunity for ready to use solution.
Overall, other dividend combined together, the number of distributed increased of 5,060 to 5,600 [indiscernible] numbers end of 31st March 2025. The numbers are material point for plastic piping system in as of close 200,000 numbers. This is a brief in the overall summer for the quarter and year-ended review. Thank you for your presence.
Now I and my colleague, Shri P.C. Somani and Shri R.J. Saboo are available to reply to various queries raised by all of you. Thank you very much.
[Operator Instructions] The first question comes from the line of Shravan Shah from Dolat Capital.
Sir, couple of things to understand. So last time also the entire FY '25 whatever we started the year in terms of the volume growth guidance has kept on reducing. And actually, we even deliver even much lower than what we discussed in the third quarter in the January. So just now trying to understand, how are -- now we're looking at in terms of the revenue volume growth and particularly the plastic pipe volume growth and the margin front for this year FY '26 .
Overall, the value growth we anticipate turnover to rise around INR 12,000 crores this year and plastic pricing system, we expect our [ previous ] to grow 3% to 4% more than the country's growth. Lastly, by unusual, we grew 12% over the country growth, [indiscernible] and we grew by 6%. For this year, we anticipate to be a normal year. So country may grow by 7% to 8% in Plastic Piping System business and our company expect to grow 3% to 4% over country's growth.
Okay. So roughly around 10% to 12% kind of plastic price growth. And the overall volume growth of combined everything would be how much are we looking at?
Similar each. Similar each.
Okay, similar. Okay. 10% to 12% ranges that we are looking at. And on the EBITDA margin front would be how much we are looking at for this year, FY '26?
Between 14.5% to 15.5%.
Okay. Got it. Now this number, whatever we are seeing this also includes the [indiscernible] number that we will be consolidating once it will be over maybe by Q1 or Q2. So that includes -- this guidance number includes the margin number or this is without the margin numbers?
We hope the [indiscernible] in our position from July -- within July onward. So hoping did everything concluded by end of June, then we will have [indiscernible] facility under our company for 9 months. And this include 9-month [ woven ] capacity also.
Okay. Okay. And then sir, now how we are looking in terms of any update on the [indiscernible] and we're now seeing that the PVC prices are bottoming? Are we seeing any kind of improvement in terms of the channel level also, how would that demand now are setting up?
I can't forecast anything about entry [indiscernible] of Finance and the [indiscernible] Supreme Court of the country. I can't talk anything. I don't know anything. But definitely, [indiscernible] and we believe that will come close to a bottom or I might have gone to bottom may drive a after some time.
The next question comes from the line of Rahul Agarwal from Ikigai Asset Management.
Sir, three questions, all are numbers. Firstly, starting with other expenses. I think seasonally, this number has to be higher. The quarter saw about INR 347 crores, which is lower both Q2 and Y-o-Y, which line items we saw savings in costs, sir?
Can you again repeat the question?
So one of the other expenses like INR 347 crores for the quarter they appear to be very low seasonally this quarter and should see higher other expenses. Any one-off accounting has happened in this quarter, sir?
No accounting. You see other, expense, the major portion consists of freight and advertising promotion. [indiscernible] because they working so we capture [indiscernible] be controlled admin expenses as last quarter.
Got it, sir. Got it. Second question, sir, on inventory loss. For the full year, sir, would you have enough estimates how much was the inventory loss?
It should not be less than INR 150 crores.
Okay. Got it, sir. And lastly, the tax rate. It keeps on fluctuating every quarter. This quarter, it was 20%. Any one-off accounting there, sir?
No, nothing specific that way. You see in the quarter where the dividend income is there, the tax that will be lower because the dividend is exempt income in hands of supreme. So you have to look at the company as a whole year.
Right. So full year, there is about 22.4. Any guidance would you provide effective tax rate for consolidated entity for Supreme Industries next year, fiscal '26?
Fiscal '26, it's very difficult to predict that way. But nothing unusual. Whatever is now you see, we are now getting the reversal of the deferred tax. Earlier, we have catered the defer tax liabilities to some extent, it is helping because now the depreciation in the books and the [indiscernible] income tax is getting reversed. [indiscernible] of the deferred tax ability.
[Operator Instructions] The next question comes from the line of Praveen Sahay from Prabhudas Lilladher Capital.
Sir, my question is related to the STP pipeline fitting in which you had a mention 8 of your plants are manufacturing right now, the SGP pipe benefiting. So if you can give some indication how much is the revenue contribution from there? And which are the major uses applications you are currently working on?
So a location, we are supplying to the trade market where we have secured a demand will be there. Definitely we have pipe, which is a top party pipe in the country, and is a very fair intensive product. The goods are showed in coil form, starting from a [indiscernible] 20 millimeter, 90 millimeter. So that is a very big component. So that like we have put in more locations. Volumes are [indiscernible] government department generally we get it from our [indiscernible] plant, where the demand was low this year because the government buying us back to not [indiscernible] last year.
So any contribution on revenue, sir if you can?
[indiscernible] demand was quite okay. [indiscernible] have no problem, but clearly a small market for us. Not a large market. It may be overall for the full year, it may be around 18,000 tonnes.
Okay. Okay. Fine, sir. The next question is related to the protective packaging and where you had given around some 12% of our volume growth with a 16% of value growth and ambition to reach INR 1,000-odd crores of revenue. So how big currently that their revenue is? And how much is the contribution in terms of volume in the entire packaging business?
Volume contribution largely comes from piping. Otherwise, [indiscernible] -- yes, is part of packaging only. And look at the revenue numbers, it could be INR 850 crores plus.
So currently, it's INR 850-odd crores, and you wanted to take it to INR 1,000-odd crore revenue by next year in this Productive Packaging? Right, sir?
Yes, you got it.
The next question comes from the line of Keshav Lahoti from HDFC Securities.
[indiscernible] I want to understand more on the volume India acquisition side, what sort of volume you would be targeting in FY '26 and '27, what sort of margin we would build in? What was the idea behind that activity? [indiscernible] want to understand that activity more from iteration wise [indiscernible] 25%, what kind of ratio normalized to maybe to see down the line this action can deliver?
[indiscernible] too many points you are asking. So be clear what you want to know from us. Please tell us.
I want to know more from the intent of like when in the acquisition, what sort of growth management have been in mind? What was the idea behind the acquisition?
[indiscernible] capacity of 73,000 metric tonnes. Normally, we use 70% capacity. So the 73,000 tonnes full year basis, we make share 51,000 tonnes volume annually with the capacity whatever there in site. Apart the volume that we are going to use from their capacity, now we would absolutely as for India and SAC countries, are the technology which they have in [indiscernible] portfolio. And also the new technology [indiscernible] will be available to our company. And [indiscernible] is a great company in building infrastructure business, there were several technologies in their portfolio, and we are going to get some of them and our product profile going forward.
Okay. Got it. And what kind of EBITDA margin this [indiscernible] can do?
Currently what EBITDA margin we are getting the same will come [indiscernible] just like our company product portfolio.
Understood. Got it. So by FY '27, its margin would be in line with the Supreme margin. And have you heard that [indiscernible] India 2 plants are on lease. So what kind of lease is it? How big the lease is?
Maybe around INR 50 million annually.
How many years?
So it is 7 to 9 years.
The next question comes from the line of [indiscernible] Shah from Molecule Ventures.
So my portion pertains [indiscernible]. So we have procured a OPEC equipment lines from a domestic equipment supplier. So just wanted to know the feedback and how do we plan to or intend to grow with the domestic equipment supply or the Spain technology player?
When we purchased the company, get their plant from molecule is a Spanish company, and we pursue many more lines from the same company, which is supply from Europe, and we very be associated with the company and we've got further more lines and more lands are going to come next year also for this year also. Some came last year, the more land will come this year. So we are buying the lines from the Spanish company.
So what I wanted to understand is that we have been planning for 9 lines coming 3 months due to supply them from the molecules technology. So just wanted to understand, they have expanded the capacity so that we are getting the equipment ahead of the [indiscernible]?
And over a period up to 2028, which is now [indiscernible].
We didn't get you, sir.
On the line what we ordered were to come up to the year 2028. Now, it's 2025.
2025. All the lines will be commissioning 2025? Calendar year, right?
I say all the land will be commissioned by 2028. I mean, I will be sharing and learning them.
Okay. Got it. Got it. And sir, understanding the [indiscernible] technology, so there also capability in the OP. So all we have any plans in terms of scaling and leveraging their technology and trying to intend into market via [indiscernible]?
For larger diameter, we have entered in to be demerger core, [indiscernible].
Okay. So more or less, we will be with the molecule as of now?
Yes.
The next question comes from the line of Sneha Talreja from Nuvama Wealth.
Just 2 questions from my end. Firstly, going ahead with your capacity expansion, like you said that you were -- you're looking at a growth of about 11%, 12%, which includes outperforming industry. Just wanted to take a sense why are we then adding capacity by 15% to 18-odd percent? Like each year, we are seeing capacity expansion close to about 15% to 18-odd percent.
[indiscernible] capacity expansion takes time. And then this year, the capacity will expand is increasing because of the [indiscernible] acquisition. So the [ 70,000 tonnes ] will come automatically from the equation point of view. The way our brownfield expansions are not debt heavy.
And apart from that, we are going to new line [indiscernible]. And for debt, we invested aroud INR 200 crores [indiscernible] system in classifying particularly will be plus. Okay. Okay.
I got that. So in that case, we can assume that [indiscernible] volumes? Sales will be over and above your capacity addition, I mean, in terms of whatever guidance you have given?
In the guidance [indiscernible] included.
Yes.
So you're seeing volume growth of 11% to 12-odd percent with [indiscernible] acquisition versus your capacity addition in FY '25 [indiscernible]. And again, you're planning around about 15% capacity addition in FY '26.
[indiscernible] missing to many [indiscernible].
No, no. The addition of capacity addition in '25, '26 is inclusive of [indiscernible] edition. So from 8.7, when we are taking close to 1 million, that includes [ 70,000 ] tonne capacity of [indiscernible] also in the current year.
Understood, right, sir, but that is close to about 30% plus, if I put together both these years. And we are talking volume growth of 12-odd percent. So that's what I was just trying to get the sense from.
They are but [indiscernible] last year [indiscernible] so we have last year, we grew by 6%. And this year, we say we'll grow 3%, 4% more than the country growth and country may grow between 8% to 9%. So we may grow 12%, 13% further. So combined 2-year, [indiscernible] be more than 20%.
Understood, sir. This was really helpful. So my second question was related to our margin guidance where we have said 14% to 15%. On the contrary, we have also said that [indiscernible] comes with certain losses at this point. [indiscernible] Of course, you'll be converting into a profitable company equal to you, but that will happen gradually by FY '27. Despite these scenarios, we're still aiming at 14% to 15% margin. I just wanted to take a sense of where are you expecting additional margin levers? What could be those levers?
We anticipate overall 14.5 to 15.5 per share overall of the company. Not piping [indiscernible] alone. We have told you made company, INR 12,000 crore [indiscernible] the company around and 14.5% to 15.5% operating margin, but they keep on the product portfolio, not plastic pipe.
Understood, sir, but that was 14% this order, and that was 15% last year. That means we are not expecting any decline in terms of margin despite [indiscernible]?
[indiscernible] will not damper our [indiscernible].
[indiscernible] it's not a big entry amount.
Okay, sir. Just lastly, if at all, I may with respect to [indiscernible] itself, what kind of products Ordinance how much margin accretive are those products versus our existing product profile of [indiscernible]?
We will not detail what are the new products we are going to add from the technology. This is classified.
The next question comes from the line of Kumar Saumya from AMBIT Capital.
My question in terms of last quarter, we had transfer 2 [indiscernible] as well at Jammu and Bihar. So are these plants -- are we postponing these plants? Or are we still improving just in that question?
Yes. For the timing, we have deferred the acquisition, [indiscernible].
We are actually in the industry policy, they were to announce the industrial incentive policy for putting industry in Bihar that announcement not come. We now are being advised that it may come for to election time. And Jammu, we are looking for a larger piece of land. So we go to [indiscernible] purchase from privately, but we applied to government for 20 [indiscernible] and we expect that the plant from government may be alloted to us. So if we are able to get access to a larger piece of land, then we will like to put a plant in a larger area, not [indiscernible] Asia. So we are working for both the policy taken by government of [indiscernible]. So for that, we have to wait.
The next question comes from the line of [indiscernible] from CD Equisearch Private Limited.
Question is like despite the increase in affordability of piping products, why has volume not picked up?
What is it? Why volume was not picked up. Ma'am, because of the falling prices continuously for the last 8 months, the market sentiments are very negative. But...
[indiscernible] last year, not this year, the volumes are going very well.
Yes. As for the last year.
[indiscernible] by [ INR 22 ] between second half July to March end, the pressure drop in. So the [indiscernible] taking place toward the train, [indiscernible]. Yes.
The next question comes from the line of Sonali from Jefferies.
Sir, I have 2 questions. Firstly, could you quantify the inventory loss because of the PVC fall this quarter in Q4 and the full year FY '25, please?
Take down, on a full year basis, we believe that the company might have lost [indiscernible] division due to the far increases. And you are [indiscernible] also. So it was the -- all the full pressure has gone down. And we are using [indiscernible] for raw material and they will [indiscernible]. We believe that we might have lost [ INR 250 crores ] of inventory loss.
Understood. Sir, my second question is any color you could shed on CPVC volume and value growth for either Q4 or full year FY '25 as a whole?
[indiscernible] We added 21% volume growth.
This quarter or full year?
Full year.
Okay. That's good to know, sir. And lastly, [indiscernible], drinking water mission. How much does it contribute to your top line overall from a full year perspective? I do remember you mentioned some 18,000 metric tonnes. Is that for [indiscernible] that you mentioned?
It is 18,000 in trade market. [indiscernible] had a very, very strong spending last year mostly supplying to Maharashtra government and Maharashtra government stopped placing many order. So we had a very small business in [indiscernible] last year.
So to the overall sales, is it fair to assume it contributes less than 5%?
Very smart. We are not a big player in infrastructure [indiscernible]. But what we paid we had will degrow last year.
Understood. Sir, and just 1 last question. How is the uptick in Agri and residential so far in this quarter?
[indiscernible] This quarter. Which was [indiscernible].
I mean by TD, sorry.
Last quarter [indiscernible] For previous [indiscernible]?
Yes, sir. That is right. In fact, Jan to March or Jan to April.
[indiscernible] Over growth in the quarter. [indiscernible].
Yes. So in spite of infra not being there, we had a growth of 2%. So it means [indiscernible] housing we're doing quite good.
The next question comes from the line of Navid Virani from Bastian Research.
I have 2 key questions regarding the [indiscernible] acquisition that we are announcing for [indiscernible]. So firstly, can you help us understand what kind of white spaces in terms of technology or products? Are we being able to fill with the [indiscernible]?
We see [indiscernible] India business is similar to business what we have but their parent company is very large, and they have the technological development [indiscernible].
I mean, how it will be helping us. [indiscernible]. There were many technology in their portfolio, which we like to develop in Indian market.
Okay. And can you just give us a sense on the kind of opportunity size these technologies to gain what will have? If you have anything from that?
No, no. We will give us some new applications, we'll be able to operate solution for many requirements in our country, which [indiscernible] technology.
Okay. Okay. And one more question is on -- so now once we acquire [indiscernible], what will happen to the brand? Are we going to be [indiscernible]?
We will deal upon the technology printing made with the [indiscernible] technology, usually Supreme brand.
Okay. And sir, what will be the final cash outflow for the acquisition [indiscernible]?
To pay [ $50 million ] and plus what working capital they are involved.
What will be that figure moving into share?
[indiscernible] million the day when we pay [indiscernible] pay.
The next question comes from the line of [ Rajat Setiya ] from IoT PMS.
My question is about the policy pipes. So we are also hearing that a lot of Chinese and Indian companies are entering. I wanted to ask you, as the company successful in terms of launching their [indiscernible] PVC line?
We are [indiscernible]. We are [indiscernible]. We are not any of the perfect paces are making goods. We can meet our specifications, and we are sharing with our suppliers.
Okay. We will only stick to molecule. Nobody else? Okay. And sir, in terms of -- given I mean, our channel take suggest that there are a couple of companies which are entering but we don't understand right now that is there any criteria as per the state government tenders and all that will restrict any sub quality player? Or anybody can just [indiscernible].
How can I say about the government policy. We made a product which is very much to the specific [indiscernible] the rail department. We are offering the solution which i.e. equal or better than [indiscernible].
Sure, sir. And sir, finally, has the demand picked up again in the PVC side? Or we are still looking [indiscernible].
As on today, we are a very small player, small capacity, and we are able to market by end large. Very small capacity today.
Yes, sir, right. So overall demand, I mean, the industry level tenders and all are picking up?
Our company, we are able to save our roots.
The next question comes from the line of Utkarsh Nopany from BOB Capital Markets Limited.
Sir, my first question is on your revenue growth guidance part. Sir, if we exclude the revenue contribution of the win acquisition, so in our sense, like it is currently generating close to around INR 650 crores [indiscernible] revenue. Then we are just targeting a revenue growth of only 8% to 10% for FY '26. So I wanted to know why we are expecting such a muted revenue growth despite steep increase in our organic annual CapEx run rate from INR 500 crores in FY '24 to around INR 1,000 to INR 1,100 crore in FY '25 and '26.
You see our revenue for the year was INR 10,400 crores, which we are targeting to around INR 12,000 crores for the FY '26. And so far [indiscernible] concerned, their revenue for 24 months of piping business I'm talking, was close to INR 500 crores. And when we acquired [indiscernible] since July, we'll have only 9 months at the most for operating period. So we cannot take the annual revenue what they used to have because we will not be having full year this year.
Okay. And sir, how much generated revenue in FY '25?
FY '25, then they are running the business. We are not the [indiscernible] basis.
And when I'm saying '24, it is December '24, [indiscernible] December '24.
Okay. And sir, like for the Industrial segment, can you provide the rationale why we are seeing a decline in our industrial sales volume for the past 3 consecutive quarter?
You've seen earlier years, there was a nonrecurring business of electronic voting machine. Due to the elections in the states in the center, there was a large quantity of the volume was supplied for the electric voting machine, which is missing in the current year. So the year which has gone by.
Okay. And sir, lastly, sir, can you please provide the nonpipe segment capacity breakup also for March '25 and how much we are expecting at the end of March '26. That is for industrial, consumer and packaging.
Yes. For '25, we have given our presentation, but still for your sake of your [indiscernible] of capacity. As of March '25, piping segment has a capacity of 72,000 metric tonnes. Industrial Products, 91,000 metric tonnes. Packaging product, 101,000 metric tonnes and consumer product, 27,000 metric tonnes, all put together [indiscernible].
And sir, how much we are expecting in March '26 for nonpipe segment?
By [indiscernible], we are targeting 1 million tonnes. Other segments, profile may come in [ 5 million tonnes]. Other segments, there is minimal capacity. So the measured capacity will come in plastic piping only and the window profile of 5,000 metric tonnes.
The next question comes from the line of [indiscernible].
With regards to OPVC pipes, how is the demand for new tenders?
[indiscernible], we are a very small player, and what we are producing were selling.
Sure, sir. And sir, any idea how many states today, except OPVs their tenders? And are there more states that are adopting OPVC?
We are registered [indiscernible] because the capacity, we don't have much capacity. So we are going to also be glad to shed also quite a large number for our capacity.
Understood, sir. And sir, how is the opportunity?
[indiscernible] our exchange. There's nothing great about it. As I said, we'd like to buy [indiscernible].
Yes. Okay. And sir, regarding the opportunity size, do you see OPVC taking away 30%, 40% market share of delay by its market?
[indiscernible] 400 millimeter. [indiscernible] up to 1.2, which are [indiscernible] large size and large volume, They are different age combination. [indiscernible].
Got it, sir. Got it. And sir, is there enough supply of PVC lines to meet the expected demand in the industry?
We are not a big players. [indiscernible].
The next question comes from the line of [indiscernible] from UTI Mutual Fund.
Sir, all my questions are answered.
The next question comes from the line of Manish Oswal from Nirmal Bang Securities Limited.
I have only 1 question on the composite cylinder division. We mentioned in our press release that this year, the was challenging and the performance were below expectation. How do you see the business to perform in F '26? And what is the update on this order from the IOC said? When we can expect this order to come?
Two, three things for the current year. One is [indiscernible] it floated tender for 4 like pieces. So apart from IOCL, now BPSL is also now coming to market for procuring these composition lenders. It is a good initiative for our purposes. Our user is now planning to float a tender for about [ INR 1 billion ] is what we learned from our interactions. And all the oil marketing companies are working for a common size of 14.2 billion cylinder. So if all those things get metalized then definitely, will be a good sign and good year on the division.
So over the medium term, so what size of opportunity is a market we can see for Supreme Industries? What is the size of opportunity here?
Right now, we have a capacity of only 1 million cylinder. And we don't have any plan to expand as of now. First, unless we utilize it appropriately we are not looking for an expansion.
What is the utilization, sir, right now?
[indiscernible] is only 50%.
The next question comes from the line of Vipul Kumar Shah from Sumangal Investment.
My question also relates to composite cylinder. So you have mentioned that performance falling short of expectation. Is it the technical operational performance? Or you're just mentioning your business performance?
[indiscernible] technical, everything is well established, [indiscernible] project.
Because there is no possibility of anybody [indiscernible] will burn out there is no possibility of any date. Every year, several people die due to the blast in cylinder. [indiscernible] not blast, which will only burn out, not a blast.
So why we are not able to scale this business, although we have a far superior product?
OMC, oil marketing company. [indiscernible].
Okay. So our cylinders are price here? I mean the cost wise, they are much costlier? How we compare cost-wise to...
[indiscernible] saving life but it's costly. When we say how should you have life. That gives costly.
The next question comes from the line of [ Madhi Jhunjhunwala ] from JM Financial PMS.
Sir, my question is largely broadly. So pipe industry in [indiscernible] has been facing wins in the last few quarters because of the PVC prices. So looking ahead, are you seeing demand coming up? Or are you seeing that PVC prices will normalize or go back up? Or are you seeing whether [indiscernible] will come up with new tenders for [indiscernible]?
About the government policy of engaging or not carrying, but we know we share they in good place last year. So they used to be a start. So this year [indiscernible] for plastic piping is a PVC growth.
Right. That is -- so do you see that happening anytime soon the restocking at your anticipated? Do you see that happening?
[indiscernible].
Okay. Got it, sir. And any update on [indiscernible], I mean, have you seen any pickup here in any other states, if not Maharashtra even if you don't operate there, is there any pickup that you see till now?
Budget proposal [indiscernible] then market spend last year. Central government made a review of INR 67,000 crores total driven, last year they spent INR 22,000 crores. We have [indiscernible] this business. We are a smart player. So Maharashtra, we know that they have not announced buying piping system for June in March that they are not still changing.
The next question comes from the line of Pujan Shah from Molecule Ventures.
Just wanted to understand that as per the government direction, we are planning to complete [indiscernible] bye 2028. We are expanding our OPVC line by 2028.
And we are expanding our OPVC lines in as well as. So what we have been envisioning? So we have been planning to open up into [indiscernible] which would help to consume that? What do you see -- or how we have been looking at after 2028?
[indiscernible] Pipe is running for many years [indiscernible]. Yes, required by some [indiscernible] replacing over pipes.
Right, right. But sir, ultimately, all the demand, which has been for the OPVC from right now is from [indiscernible] so just wondered on that.
You know better then. [indiscernible], we are not [indiscernible] anyway.
Noted, sir. And sir, just wanted to clarify on the -- so the expansion of lines will be on 2028. So why we are procuring -- is it due to the slowdown, which has been affecting us to bid earlier or maybe just our strategy to get into [indiscernible]?
[indiscernible] capability they can produce every year.
Okay. Okay. So that's the challenge we have been facing due to that?
[indiscernible] came into us also.
Payment flows?
[indiscernible], we have to put the machine based on that growth, but I can perceive for my company. I don't [indiscernible] money and give the ratio either.
The next question comes from the line of [ Sam Chan ] from Marcellus Investment Managers.
Just 1 question. So what would be the CPVC mix in our overall piping business for this fiscal FY '25?
Sorry, CPVC mix is a classified information.
The next question comes from the line of Keshav Lahoti from HDFC Securities.
I just wanted to get a [indiscernible], you mentioned something like 12% volume growth in [indiscernible]. So this was inventory growth in [indiscernible] And secondly, this is growth due to primary sales or fillings of canning inventory? [indiscernible]?
The 12% volume growth, you see, we were [indiscernible] today. The volume growth, what we have spoken, what you [indiscernible]...
In degrowth of 6% and we [indiscernible] better than the country. Currently, 26% growth in plastic piping system by volume last year. Our company grew 6% by volume last year. So based on the country growth, we have grown 12% better than country growth. This is what I told in the TV.
Okay. Sir, you have mentioned something on April since how has been the demand growing?
[indiscernible] to go sit. Let's take months go [indiscernible].
The next question comes from the line of [indiscernible] from M3 Investments.
I just know about the antidumping duty sites. There was a notification and then it was passed. So are there any at the moment? On PVC?
No, no, no. If we are still to come. Digital [indiscernible] to issue the final filing, their provision finding already came and the final filing is did not come. So we are waiting when the [indiscernible] announced the final finding. Before final finding, nothing is going to happen. So we are waiting.
Right. And was the resistance from CPVC manufacturer in India that they have put a case that was...
You asked a question from the [indiscernible].
The next question comes from the line of Manish Mahawar from Antique Stockbroking.
Yes, just 2 questions. In terms of the industry, when you say the industry have declined minus 6% last year, and we have gone [indiscernible], what were industry size [indiscernible] in terms of tonnage?
[indiscernible] industry?
Yes, sorry, industry size.
Last year, it was [ 4.29 million ] tonnes.
4.29. And you are expecting it will grow by 7% to 8% this year, right, sir?
Normal yes, even in November, generally, it should grow slightly better than the continued GDP growth. The most special [indiscernible] 6.2% GDP growth in the current year forecast given by the so many experts. So we believe [indiscernible] grew by 6.2%. The plastic pipe witness volume should grow better than country GDP growth, which is our experience in previous years. So it should grow by 7%, 8%, something better than the TD growth.
Understood, sir. And sir, in terms of this 4.29 million mean what you said in the piping, what is the -- sorry, sir?
4.29 million tonne plastic piping system premium polymers.
Okay. Understood. And sir, secondly, in terms of one of the comments you made consistently, there's a 14 or 15x price have declined for PVC, right? And that led to a destocking in the channel. So do we have any -- can you give some sense how the charter inventory at the moment versus the normal?
Channels -- channel, but we believe that we could set a large destocking [indiscernible] have to come back to [indiscernible].
The next question comes from the line of Shravan Shah from Dolat Capital.
Sir, just trying to understand the math. When we say that the industry plastic pipe will grow at 7%, 8% and we will do a [ 3% ] higher. So let's say, a 12% on the higher side. So last year, FY '25, volume is [ 31,000. ] If I do a 12% [indiscernible] 63,700 and in that [indiscernible], if I consider 70% utilization for 9 months, it comes around 38,000. So the -- on the core front, we will be growing by 25,000 tonnes, 25,026 which is a kind of a less than 5%, 4.8%, which is lower than the 6% of the FY '25. So just trying to understand where am I missing?
You have shown me a number. Come [indiscernible] 75,000 tonnes. [indiscernible] is 76,000 tonnes. [indiscernible] 9 months, they cannot produce more than 55,000 tonnes. Normally, you can run only [indiscernible] 36,000 tonne of [indiscernible] we are invested in our company capacity, which are really 8.75, we have ton of [indiscernible].
Just let me repeat the question to him. [indiscernible].
12% last year.
No. Current year.
I never told any question.
Industry growth is 7%, 8% [indiscernible].
Maybe yes. So yes, we will grow to 600,000 tonnes, right? So out of which we [indiscernible].
So sir, that's what I wanted to understand if the [indiscernible] is not there as you are saying, then it is -- you can achieve a 6 lakh kind of a volume. So with [indiscernible] -- yes. So with [indiscernible], it should be up like [indiscernible]. So then the growth number...
Yes. It may be.
Yes. So then the growth number would be much, so that's the only thing I wanted to understand that the...
Might be at 13%, 14%, depends on how the market demand comes. We are quite demand in the market.
As there are no further questions, I will now hand the conference over to the management for their closing comments.
Thank you very much. We are very thankful to our investors [indiscernible] question. We thank all of them for the time and the question [indiscernible]. We thank you thank all of them.
Thank you [indiscernible]. Thank you.
On behalf of DAM Capital Advisors, that concludes this conference. Thank you for joining us. You may now disconnect your lines.