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Ratnamani Metals and Tubes Ltd
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Ladies and gentlemen, good day, and welcome to the Ratnamani Metals & Tubes Q1 FY '23 Earnings Conference Call hosted by Monarch Networth Capital. [Operator Instructions] Please note, this conference is being recorded. I now hand the conference over to Mr. Sahil Sanghvi from Monarch Networth Capital. Thank you, and over to you, sir.
Thank you, Jitendra. Good afternoon to all. On behalf of Monarch Networth Capital, we welcome you all for the Ratnamani 1Q FY '23 Earnings Call. We are delighted to host the management of Ratnamani today. And from their side, we have Mr. Prakash Sanghvi, the MD and Chairman and Mr. Manoj Sanghvi, who is the business head and also Mr. Vimal Katta, Chief Financial Officer. So without taking any much time, I'll hand over the call to Mr. Manoj Sanghvi, sir, for the opening remarks. Thank you, and over to you, sir.
Yes. Good afternoon. I welcome you all to this call and hope everyone is doing good. Our results for the first quarter of FY '23 have been uploaded on the exchanges, and I believe you all would have had a chance to go through it.
As you all know, past few months has been unprecedented in terms of volatility witnessed across segments, be it commodities, currencies, interest rates and equity. Not only this but also the actions imposed by various countries on global trade, coupled with geopolitical issues have cropped various challenges for the business climate.
Most of the developed countries are facing high inflation, resulting to high interest rate, outlook compared to our country, which is still reflecting strong macroeconomic scenario. As per various estimates, our economic growth outlook have shown resilience and may remain less impacted. Decline in the commodity prices may further improve the infrastructure demand and some good traction may be expected in CS and SS pipes.
Capacity expansion across refineries and process industries is likely to maintain the momentum, and we expect further improvement in capacity utilization. Continued energy prices at elevated level well for the projects in oil and gas opportunities are expected to be robust here.
And as you are all aware about the opportunities on the domestic front due to surge -- increased allocation of government on CGD, Jal Jeevan Mission, Har Ghar Nal Se Jal, Ken-Betwa river-linking projects, oil and gas transmission project, et cetera.
Since you are all aware -- since you all are well updated on these schemes and opportunities arising thereof, I would like to straightaway touch upon the quarterly financial numbers and business update in brief, and then we can take questions.
So our revenue has increased 85% year-on-year and is flat on a sequential basis. EBITDA has increased to INR 139.45 crores from INR 92.6 crores on year-on-year basis, registering a 50% growth sequentially -- sorry, registering a 50% growth and sequentially it has been down by 21.8%. Our EBITDA margin has also contracted on by around 4% due to product mix and higher raw material costs. During the quarter, in spite of inflationary pressures, belt on operating costs, we have been able to contain the same at the levels of preceding quarter. Our net profit margins have reduced by 25 basis points to 250 basis points sequentially, mainly on account of inventories, and for the year, we don't expect the variation to be more than plus/minus 200 basis points.
Our orders on hand as on 1 August is INR 2,345 crores, of which exports is INR 455 crores. This financial year began with lots of uncertainties and challenges in terms of geopolitical situations, inflation, rate hikes, tapering of liquidity and high volatility witnessed in commodities and the global situation is likely to remain same over for next few months. So giving any guidance for the long period may not be suitable at this juncture. But as highlighted earlier, we target for a growth of 15% to 20% at a constant price basis for this.
Thank you. Sahil, are you there? Hello? Sahil, are you there?
Yes. Yes, sir. Jitendra, you may now start the Q&A session.
[Operator Instructions] The first question is from the line of Ashutosh Tiwari with Equirus Securities.
Firstly, in the new order booking that we're doing, has the steel prices started coming down, like stainless steel and carbon steel compared to last 3 months back, are we seeing moderation in steel prices as well when you're booking it?
Order booking has been consistent, and it has rather gone up.
No, no, no, I'm not talking about order booking. I'm saying that in the order booking that we are doing in carbon steel and stainless steel, has the pricing per ton started coming down now because of the steel price decline?
Yes, yes. The pricing per ton less, it has come down.
Okay. So basically, if we've seen some improvement on a quarter-on-quarter basis in your order books from INR 2,223 crores as of last quarter to INR 2,345 crores that means volume addition would have been better than the increase in order book?
Yes. Volume addition is better than what it was in the last quarter.
Okay. And I think we are now seeing good traction in your stainless steel order book, so can we just explain like which are the drivers over here? Is it like we also have entered in the larger diameter tubes with this new extrusion plant, is it playing out or is it still the normal order that we used to receive earlier?
These are -- Ashutosh, these are normal order. New hot extrusion order booking will start picking up after some time. Right now, whatever is being produced is being capital equilibrium, some quantities have been sold in the market also, but those are not significant. So...
But my question is that are we, let's say, in our sales mix or orders, whatever you're getting in that mix, has the share of larger diameter started going up, inching up a bit or that's not still not visible? I understand that you're not selling hot extrusion directly in the market, but is that diameter are we inching up now?
See, above 2 inch, whatever we need earlier we used to import that has been replaced from whatever we are producing from the new hot extrusion facility. So anyway, that larger diameter is being used. Yes. But the sizes exclusive to this hot extrusion, that is 8 to 10 inch, that will take some time because those demands are driven by the CapEx happening in oil and gas sector and other refineries. So gradually those should be happening going forward.
Okay. And in the carbon steel side, can I realize some of the projects are coming up in domestic and export, basically, which will drive growth going ahead? Some new projects are being announced by refineries other places oil and gas space?
Yes. So there are -- see, there a few water projects in Gujarat and MP and Rajasthan, which we feel will be finalized in another 3 to 4 months. Like we had Sauni in Gujarat, there is a Sauni first phase, which has already -- tenders are out and awards to EPC will happen in another month or 2. So then the EPCs will finalize -- that put together is 250,000 metric tons spiral pipes.
This is in Gujarat you're saying or all 3 states put together?
Yes. This is in Gujarat. Then similarly, there was Rajiv Gandhi Link Canal project in Rajasthan, which is 110,000 tons. So that will be finalized in next -- whatever I'm saying is for the next 2 to 3 months, what will be finalized.
So this is in water. And then we've been seeing regular requirement from all the private as well as public sector unit. Our ERW as of now is booked till November and we see that in next 2-3 months, we will be able to book the same until March. On ERW, there are few product lines also where the tenders are submitted for BPCL and HPCL.
Okay. So in this water orders, the margin should be lower than what we get in oil and gas or because it's located in Gujarat and Rajasthan so we probably can still make decent margin over here?
Yes, because it is located in Gujarat and Rajasthan, we will still make decent margins. And oil and gas, we've seen domestic whatever projects were there like for IOCL and for NRL, those have been finalized. There are some projects from HPCL, IGGL, where we have submitted the tenders.
You said BPCL, right, HPCL?
Yes. BPCL is there, then there is IGGL. Indradhanush Gas Grid Limited, where few tenders are there. Then there is 1 tender from GSPL which is GSPL Chhara Pipeline. So that will be finalized. That is roughly 30,000 tons. And GIGL, which is a subsidiary of GSPL, is coming up with 2 tenders.
Okay. Okay. So as of now, the pipeline looks good in carbon steel space?
Yes. Yes. The demand for water is more than oil and gas in line pipes, whereas on the petrochemical and refinery, the demand for LSAW pipe is good.
Sorry, I missed it. You said in petrochemical and refinery, what is good?
The demand for LSAW pipes.
LSAW. Okay. And lastly, some financial questions. One is, how is the net cash position as of June '22.
The net-net will be positive, but not very significantly because working capital continues to be on the higher side. So that is the thing. And on gross level, we should be having closer to INR 150 crores-plus sort of investment -- sorry, INR 220 crores-plus sort of investments as on 30 June. Yes.
Investment you are saying? Right, investment?
Liquid and FDs. Yes.
Yes, yes, yes. And debt is how much?
Debt will be closer to INR 150 crores, INR 160 crores only. So net-net that INR 60 crores, INR 70 crores remains with the company.
And depreciation charges went down quarter-on-quarter, INR 23 crores to INR 19 crores. Any reason how should we look at this going ahead?
See, basically, on average, this 20 should be taken. Here, depreciation what happens under company's act it works based on the number of ships worked. So that is the thing, yes. And 1 hot extrusion working at Kutch that has been now scrapped. And a new facility already it has been commissioned at Indrad. So now even for lower sizes, also, we have a new facility of hot extrusion. So now again, depreciation will start moving up in this quarter onwards. Yes.
Okay, okay. And lastly, I think we mentioned that in this quarter because of maybe at the time of order booking, there's some volatility in the steel that probably hit us in terms of margins, so that should normalize going ahead. We still stick to 16% to 18% margin range?
Yes, yes, yes. See, that average of 16% to 18% plus minus 1% seems to be maintainable over a longer period for any extended period and some variations may be there -- based on the product mix and the market situation.
Our next question is from the line of Pujan Shah with Congruence Advisers.
A couple of questions. First question will be let's say, currently, we have been -- like quarter-on-quarter wise, we have been pretty good on a revenue standpoint. But at the PAT margin, we have been like 2 bps been lower. And looking at the trajectory we have been always in. So are we seeing this bottoming out as we have been seeing an increasing the order book everything is being currently in the oil and gas is going into CapEx mode and all the things.
So are we saying that we have almost bottomed out as the price has also been coming down steel prices? I know that the export order has been currently the stagnate point or you can say, on a debt basis. But are we saying that this is the lower -- this is the, you can say, the low we have hit and that is behind us?
It will seems like that, but nobody can actually say that. It depends totally on the product mix. Going forward, whatever product mix we have with the orders on hand, this seems to be the bottom.
Okay. Sir, can you just repeat the order book, actually I missed out, sir? Can you just -- if you can?
INR 2,345 crores is the total order as on 1 August, of which exports is INR 455 crores.
And sir, can I get the split between the order book, like is it more in water, oil and gas if you can split it out?
No, I don't have any bifurcation on -- industry-wise bifurcation is not there.
But see, basically, here, in our case, water this time will be hardly any. Majority, it will be oil and gas sector and other process industries. See, carbon is still is 100% oil and gas, you can say maybe 2%, 3% here and there whatever might be there, a few very small sized orders. In case of external facilities, it is 100% oil and gas sector and other process industry. Water right now is not there in any significant way.
So sir, with this standpoint and the current trajectory, are we seeing all the demand like in like, let's say, in 2, 3 years of horizon, are we seeing any new sector coming up or like which we will see this traction coming from this only sector? Are we seeing any new traction coming on from other industry specific like manufacturing or sort of a thing like any specific industry, capital good industry or like?
No, right now, maximum traction is still seen in the same industry. Going forward, maybe once the hydrogen, the technology on the transmission of hydrogen evolves then yes, we might see to other -- in other industries. But as of now, it is mostly oil and gas, power, chemical industry, pharmaceutical industries, dairy, sugar, those industries only.
Our next question is from the line of Hirenkumar Desai.
Yes. So 1 question is because of high oil prices and this company is not raising prices, they have been -- BPCL, et cetera, they have been reporting losses. Do you suspect some reduction in CapEx because of these problems, which is impacting our demand adversely?
So no, we don't see any reduction in CapEx with the current oil prices and the refining margins. It would improve. And further, a lot of petrochemicals, we see a lot of expansion in the petrochemical plant because there's a growing demand in the country for petchem.
Okay. And secondly is just a book question. What is the total stainless steel and carbon steel capacity? And what is the current capacity utilization?
So carbon steel all put together 500,000 tons and stainless steel 50,000 tons.
I think that broke. That stainless I couldn't hear. Please?
Stainless steel, 50,000 tons.
Our next question is from the line of Vikash Singh with PhillipCapital.
Sir, I just want to understand that in this quarter, though we have a back-to-back booking, but certain portion would still be exposed to the tragedies of RM cost stream. So have we taken any inventory write-downs?
No, no, no. It is not like that. See, basically, what happens at the time of tendering itself, there will always be a band below which we will not go. So if the prices are falling within that brand, particularly in the aspect of tender business, so we book our orders because it is never advise to keep the capacities idle just to ensure the bottom line achieves a particular percentage.
So 1% or 2% here and there will always be there. So everything is dependent on the market conditions, plus the product mix of dispatches during a particular quarter will also impact the margins. You might have seen in case of third quarter or last financial year, again, margins had come down significantly, though they were in 30, 40 bps better than what they are right now.
So this situation will always be there. There may be certain quarters where margins may improve significantly. So -- and no inventory write-down in our case because all inventories are marked against order fund. We don't have inventories which are for external sales.
Understood, sir. Since we don't give the segmental assets and carbon steel data anymore. But in terms of growth out of these 2, which 1 is you expect to be a larger contributor in the overall earnings going forward? Because stainless steel in FY '23, I believe, has been grown from the previous level. So I just wanted to understand which of these segments would have a larger say in the -- our earning profile?
See, between 30%, 35% turnover will continue to come from stainless steel and remaining from carbon steel. This 5%, 7% band, you can say 27% to 35%, 36% will be the range -- broader range for stainless steel quarter-on-quarter. Yearly, roughly 30% to 35% win with the range. We'll do the current capacities, which we have set up.
Yes. But since we are talking about last quarter, we have given like a 30% utilization of new asset capacity. So wouldn't it be that the assets would be pitching in more and hence, our overall margin profile should be improving?
No, excess capacity utilization mainly will be used captively. So our input dependency has reduced, which will further reduce going forward. So whatever we were importing earlier that we will be substituting from our new hot extrusion. And some capacities will be available for sale to other. So that will not have a major impact on the product mix.
And as such, there is increase -- suppose if there is increase in Stainless Steel revenues, there is an increase in Carbon Steel revenues also because new CS pipe capacities have been set up and commercially operating now.
Understood. And sir, since we -- this quarter was pretty good. So are we maintaining our annual revenue guidance impact which we have given in 4Q...
Yes. 15% to 20% growth, we maintain.
So effectively anywhere 30 to -- anywhere 25% to 30% is the volume growth which we are building in, in our estimates. Is that a correct assumption since the pricing has been already coming down?
No, 15% to 20% growth.
This is the revenue growth you are talking about, right? I was talking about if revenue is growing by 15% to 20%, then my volume should be closer to 30% growth because since average prices have been lower now?
See, in case of carbon steel, you may be correct to some extent. But in case of stainless steel tonnage will never help you, reason being there are products where tonnage will be much lower, but value addition will be much higher.
And as we have been saying for so many times, our focus has always been on the high value-added products. We are never chasing the volumes in terms of tonnage. We are chasing the value addition. So the products which give higher value additions will be taken up which may not result into higher tonnage being produced, but higher value addition will be there, higher turnover will be there.
So see, we have a product range which starts at INR 300 a kg, goes up to INR 5,000 a kg in Stainless Steel, so if INR 5,000 a kg item is there, tonnage will not be there, see it like that.
Understood, sir. And sir, last quarter, we also announced additional CapEx in SS as well as HSAW mills in a new location. So any update on the progress on the same?
Yes, SS work is going on. And the Helical SAW, some progress is already there and the preparation of the grounds. We'll share the development in next 3 to 6 months' time.
Understood. And sir, if I may ask 1 last question. So recently, 1 of your global competitor, Tubacex won a multiyear deal in the Abu Dhabi Oil Corporation. So I just wanted to understand, so our focus is still on the -- replacing the domestic basically arrivals imports? Or are we started to focus on the export market? Because right now the export market looks pretty good, many countries are looking to increase their refining capacity. So what are the addressable market segment there, if you could just give us a little bit explanation on that?
See, traditionally, almost 40% of our turnover in stainless steel has been coming from exports, physical expense only. And additional, roughly 20% will be from indirect exports. Since we supply to the equipment manufacturer who, in turn, exports the equipment, okay? This proportion continues to remain there. And if you go through our outstanding order book of the last couple of quarters, so these exports in stainless steel have good up reasonably well. And they are continuously in this range of INR 250 crores sort of things. So this is there.
And for the new hot extrusion, that process has now started because now things have become a little more stable. Now COVID restrictions are also not there, international travel has also become easier. So gradually, we may see an export booking happening in case of per products from the new facility also. It will take some time.
So did we get all the approvals in India for that -- sorry, sir, please.
Right now -- Tubacex has not received any order, but the announcement was that they are setting up something in Abu Dhabi.
Yes, somewhere around 30,000 tons has been, what I believe, has been in line basically is a multiyear deal, basically. This was -- I assume is one of the largest in SS segment.
So sir, have you got all the approvals for the new SS plant in the domestic market or there are still few approvals pending and would take time? So also in terms of the -- you said recently there would be some time before we start exporting also. So I just wanted to understand what is the time line we are looking at?
No, that process is an ongoing process. And in another 2 to 3 years, we will have all the approvals.
See, and in case of this Tubacex, they have secured the orders related to upstream the gas extraction -- for gas extraction, where right now we are not present. It will take some time because right now we are -- mainly we are on downstream project application products. Obviously, can we benefit it? It will take some time because for us that will be a newer segment. So maybe in next 2 to 3 years' time, we may have that product range also available with us.
Again, if you can recollect when we started first discussing about the new facility we have said that the same facility can manufacture deep drilling application products also because as you go deeper, normal Carbon Steel Stainless pipes are replaced with Duplex or Duplex sort of steel, so it will take some time.
Our next question is from the line of Abhijeet Bora with Sharekhan.
Yes, sir, I have 2 questions. Firstly, last time you guided for 20% to 25% revenue growth. This time, you are guiding lower growth. Any special reason for that?
No, I -- we saw -- some price correction has happened in the steel and stainless steel segment. But it is close to 20% still, I mean.
See, we should be in that vicinity -- vicinity of that INR 3,800 crores, INR 4,000 crores of thing. Anyway, it will be higher than 20%. Yes.
Sorry, can you repeat it again, I couldn't hear you?
See, looking to the performance of first quarter and outstanding order book position, which is there, and the turnover, which we might have achieved in July, keeping the run rate of INR 300 crores minimum. So we should be in that range of INR 3,800 crores sort of thing, which anyway will be more than 20%. Yes.
Okay. Okay. And secondly, my understanding is that whatever there is a change in the raw material cost that is a pass-through for you. You mentioned in the opening remarks that it was one of the reasons for the lower margin and when you talk about product mix change, can you just throw some more light on what was this change which impacted the margins?
So product mix is one if the proportion of carbon steel pipes substantially changes, then the margins can shift by 1% or 2%. So that is the product mix. And even within the particular product, so within carbon steel, if helical increases to a great extent then LSAW and AW, then margin might change a little bit. Similarly, in stainless steel also, if some high value-added products, that proportion of that goes down and welded pipes, for example, general welded pipes goes up, then -- so within stainless steel, within carbon steel also -- even if the -- yes, margin varies from product to product. So that mix if it changes, we try to remain -- and the mix is such that we achieve somewhere between 15% to 18%.
See, quarter-on-quarter performance keep on fluctuating. We have earlier also seen it might come down 2% it may go up to 20% also, but on average yearly performance should fall within that range.
Okay. And 1 last question. Can you throw some light on the bid pipeline across sectors? I missed in the earlier part. The bid pipeline which we are looking at across sectors, oil and gas, water, I missed on in the earlier part, if you have explained it. New orders pipeline, which we are bidding for or we've already bid for.
So as I commented earlier, in water, there is roughly 250,000 tons to be finalized in Gujarat. About 110,000, 120,000 tons to be finalized in Rajasthan. And there is, of course, 200,000 to 300,000 tons to be finalized in MP. We are considering for water only these 3 states because of the proximity.
Then in oil and gas, we have about 100,000 tons of projects, which tenders have been submitted and the results are awaited. Then there is demand from approx. 20,000 to 25,000 tons of pipes required for city gas distribution from various private players and public sector unit. So of that, we feel that, of course, 10,000 to 15,000 tons of ERW pipe, we can secure.
And on the LSAW and on stainless steel, a lot of process pipes for LNG and pipes for refineries. So we've seen a lot of requirements from there. In exports, we've seen requirements for small diameter tubes.
And some projects were -- because Russia also had a good amount of pipe making capacity, and they were supplying to a lot of projects in Europe. But because of the sanctions, they are no longer able to supply. So we've seen a few inquiries and rather one of them we converted to order also for Europe.
Our next question is from the line of Anirudh Shetty with the Solidarity Investment Managers.
I had 3 questions. So just to push on this point or on what's happening in Russia. Given that Europe is so dependent on Russia gas and they're looking to derisk, and that might entail more expansion in this LNG terminal setups and all that's required. Do you see a business opportunity for Ratnamani because of this CapEx that they might be to incur? And are we seeing more inquiries coming on that front?
So on Russia, as I informed earlier, Russia has a huge pipe making capacity. That is carbon steel. And Ukraine has a good amount of stainless steel pipe making capacity. So both of them has disturbed because of the war situation and Russia because of sanctions. So the flow of inquiry and even the finalization, both for stainless steel and carbon steel, we've seen going up.
Yes, good traction is seen from Europe. Now going forward, yes, a lot of countries will start working on reducing the dependency on Russia. So where easiest is LNG -- bringing the LNG and once the LNG is brought into the country to get it to the storage tank, stainless steel pipe is the only solution. So we will see good demand coming for stainless steel pipes for that going forward.
Got it. And is there also an opportunity from -- like there is always China plus 1 now there could be a Russia, Ukraine plus 1. Is there -- could there be a Europe plus 1 opportunity for us? If the power cost in Europe is going up, would that impact the cost effectiveness of European players which would leave us better positioned to gain market share from them. Is that also an opportunity?
Yes, definitely. That opportunity, not only the cost going up, but even supply is an issue for them right now to get gas, a lot of industry in that suffering. So that's why in other markets also, we will definitely see a lot of traction.
Got it. Sir, my final question is, I wanted to understand the true useful life of our fixed assets. So if I look at our plant and equipment and all of that, what was the useful life be? And what is the depreciation life for that today?
See, roughly, you can take around 20 to 25 years, as useful life for various items of random machinery. It depends on different random machineries also. So that hope is there.
Yes. But a lot of upgradation, maintenance, modification continues. So every second year, third year, electricals definitely would change, but mechanical can go for much longer than 25 years also, like steel -- nothing would happen to steel for 25 years.
So just to clarify, 20 to 25 years is the life cover which we depreciate this asset, but you're saying that the mechanical parts can actually last much longer. So the actual useful life is longer than this 2025?
Yes, yes. See, actually actual life depends on how the random machines items are maintained. See, if we talk about our earlier investment in hot extrusion facility, that plant was of 1960s vintage. ERW mill what we are right now using that is 1960 vintage. So a lot depends on these things. How you maintain.
Yes. But that of 1960 is -- if you see all the electricals and some mechanicals also have been completely changed to the latest generation and except for the steel nothing is old.
So we -- as a policy, we depreciate our machinery for a period of 20 to 25 years based on the inputs from our technical team. And then, of course, maintenance CapEx keeps on happening. And usually, these machinery items will last for a much longer time period than this 20, 25 years. So we have at machinery items, which have been in booked depreciated fully, but they are working as good as new ones. The fact is our existing process pipe facility will be more or less 80% to 90% depreciated, but is contributing almost INR 300 crore to INR 400 crore to the top line with a very good margin.
Got it. And one final question is, what is the typical maintenance CapEx in our business? And how is that accounted for? Is that taken through the P&L or do we capitalize it?
No, it is part of P&L -- profit and loss account only under repairs and maintenance. It will be hardly any means, maybe anything around INR 40 crores maximum, you can say. INR 40 crores product.
Our next question is from the line of Kunal Shah with Carnelian Capital. Since Mr. Shah is not responding, we will go ahead and -- go ahead with the other questions. Our next question is from the line of Radha Agarwalla with B&K Securities.
Am I audible?
Yes.
Okay. Firstly, I'd like to tell the moderator that the line is pretty patchy and there are multiple breaks in between. So if you can resolve that. So sir, my first question to you is, previously, we've spoken about Cauvery Basin refinery. So is there any visibility on order -- obtaining order from the same? And what could be the size of opportunity for SS pipes from them?
There is no further development on that right now. So it was still to be awarded for feed, but it is not yet awarded.
Okay. Okay. Sir, also, if you see in the last 5 years, the stainless steel volumes are -- have been pretty flat in the range of about 21,000. So by when do we see that the volume will start picking up significantly? And what do you expect -- like how confident are we in filling the stainless steel capacity for the next 3 to 4 years?
See, we are -- increasing volume is very easy, but then value addition will take a hit. Basically our -- if you might have heard me in this call earlier, see, focus has been on the higher value-added products which may not give you the tonnage in -- which may not contribute significantly to the volume, but value addition will continue to be good. So focus continues in that direction. A lot of investment or development of import substitute products and higher value-added products has been going on continuously. And that is the reason we have been in a position to -- with the end market volatility in a much better way in last couple of years' time.
So going forward also, we may not see volumes increasing significantly, even once this is the existing production facilities utilized optimally and also we'll try to have those products hot extrusion, which are exotic in nature, which are in more substitute products where not many players are there, competition is less, so that our position is safeguarded and we continue to enjoy an edge and a distance between ourselves and our nearest competitor.
Okay. Understood. Got it, sir. Sir, just 1 last question. Forgive me if it's a repetition because the line was patchy. So could you give me some idea on the project-wise opportunity like CGD projects and water segment, what is the present opportunity that you see in that? And in the upcoming CGD project, which round working is going on like around 5 to 10?
No, CGD 10th round was already over -- 11th, 11th round was over, sorry. So next, I think will come after maybe 5 or 6 months. But a lot of geographical areas are already awarded. So CapEx for those geographical areas is being planned. And eventually the network has to be increased by the existing players. So the demand for CGD will come from their side.
Water, Gujarat, Rajasthan, MP, we've already said 300,000 to 400,000 tons already under bidding. And oil and gas we've already submitted close to 100,000 tons of tender, for which the results is awaited.
Our next question is from the line of Raj Shah with Marcellus Investment Managers.
Am I audible?
Yes, you are audible, sir. Go ahead.
Okay. Sir, my question was, sir, if you see this industry, especially, since our industry is highly dependent on the CapEx by refineries. So 5 years down the line, if we say the EV has seen substantial penetration, how do you see the CapEx by oil and gas 5 years down the line, sir?
Hello.
Manoj sir, we can hear you. We can go ahead with the call. Raj, you can go ahead with your questions.
The call got dropped.
Mr. Shah, you can go ahead with your question. Can you hear us? Since there is no response from Mr. Shah, then we will go ahead and take the next question. Our next question is from the line of Pujan Shah.
Actually, just one question. On the order book, which we have been setting up to, what is the execution figure for this, like 6 months odd, sir?
In current financial year.
So this is the current financial year. Okay. Got it.
[Operator Instructions] Since there are no more questions, we have come to the end of the question-and-answer session. Okay. Just give me one moment. We have one question from the line of Mr. Hirenkumar Desai.
Yes. The question is, so one -- somebody in the management mentioned about improving demand outlook because of Russia and Ukraine issues. Are we observing something similar because of lockdowns in China, because of COVID, et cetera? And I mean, what kind of impact are we seeing?
No. Lockdown in China were there earlier, but everything has opened up now. With that...
More or less... China is more or less able to produce whatever they want to export or whatever.
Yes, yes. And lockdown were more within the city or some area. It was -- for industrial areas there were no major lockdowns. Only thing the supply chain was a little disturbed, but now...
Thank you. Since there are no more questions, we have come to the end of the question-and-answer session. I would now like to hand the conference over to Mr. Sahil Sanghvi for closing comments. Please go ahead, sir.
I just want to thank the entire management of Ratnamani Metals for patiently answering all the questions. And behalf of Monarch Networth, I would also like to thank all the participants for joining in the call. Manoj sir, would you like to give any closing comments?
So thank you, everyone. I would like to conclude the -- I would, just like to say that, with recent correction of prices, good monsoons and still no major signs of major demand destruction, our utilization is expected to remain better, and we may remain in our target of growth trajectory, which is what 20% what we have -- we expect as we've been maintaining over a long period. So we are confident that we will remain around that number. We thank you all the participants to attend the call and patience for hearing. Thanks.
On behalf of Monarch Networth Capital, that concludes this conference. Thank you for joining us, and you may now disconnect your lines.