• 12% EBITDA rise in 9M ending FY 22 to Rs. 5429cr. from Rs. 3840cr. against the same period last year 
• 37% YOY growth in revenue from Steel Pipe and Strips due to strong volume growth in value-added products and higher steel prices
• Exports order book of Steel Pipe and Strips stood at 32,000 MT as of 31st December 2021
• Large-dia section pipe facility with Direct Forming Technology (DFT) commissioned at Gwalior by the end of FY22
• 10% growth in revenue of LED Lighting during Q3FY22 compared with Q3FY21 along with increased share of value-added products like LED battens and down-lighters
• Projects for Professional smart lighting solutions commissioned at Bharat Darshan Park (Punjabi Bagh, New Delhi), Aurangabad Karodi National Highway and Tallah Bridge (Kolkata)

 New Delhi : Surya Roshni Limited, the largest exporter of ERW Pipes, the largest producer of ERW GI pipes and one of the largest Lighting Companies in India, clocked resilient performance in its financial results for Q3 2022 and nine months ended December 31, 2021, driven by an improved product mix.

The company reported a 29% growth in revenue to Rs. 2030 cr. in the third quarter from Rs. 1578cr. against the same period last year due to strong growth in value-added product categories in both its businesses (Steel Pipe & Strips and Lighting & Consumer Durables) and higher steel prices. However, the margins remained under pressure due to higher raw material prices and other input costs, which were partially offset by price increases.

In the Steel Pipes and Strips Business, the company witnessed a growth of 37% YoY in revenue, driven by higher steel prices and a consistent increased share of margin accretive API pipes and exports. There has been a substantial 40% volume growth registered in value-added products and markets, including API & Spiral Pipes, Actual Users and Exports. The company witnessed a strong export order book at 32,000 MT as of 31st December 2021, whereas the API coated pipes orderbook stood at 50,000 MT during the same period. Going forward, the focus remains on increasing the share of value-added products like GI pipes, API coated pipes and exports in steel pipes and strips.

The company commissioned a large-dia section pipe facility with Direct Forming Technology (DFT) at Gwalior by the end of FY22. It is targeting a healthy revenue mix from Domestic and Exports markets.

Meanwhile, in the Lighting and Consumer Durables Business, Surya Roshni witnessed healthy growth across the new-age product lines. There has been a 10% growth in revenue of LED Lighting during Q3FY22 as compared with Q3FY21, along with an increased share of value-added products like LED battens and down-lighters. The business intensified its advertising and marketing spending with new ad campaigns for its Lighting and mixer-grinders.

While new Projects for Professional smart lighting solutions have been commissioned at Bharat Darshan Park (Punjabi Bagh, New Delhi), Aurangabad Karodi National Highway and Tallah Bridge (Kolkata), the Greater Noida LED Street Lighting worth Rs. 41 crores, Tawi Bridge façade lighting, and multiple prestigious projects are under implementation.

Surya Roshni has received approval under the ‘Large Investment’ category for manufacturing components of LED lighting in the PLI Scheme. The Capex of Rs. 25 crores to be incurred over 5 years has already started. This shall further strengthen the backward integration and reduce reliance on imported components.

Commenting on the results, Mr. Raju Bista, Managing Director of Surya Roshni, said, “The company continued to register a resilient performance on a YoY basis primarily driven by a growing share of value-added products across Steel Pipes, Lighting and Consumer Durables. The margins were impacted to some extent as the input costs continued to remain at elevated level. However, the company proactively undertook multiple price hikes and will continue further to mitigate higher input costs. With strong brand recall and customer preference for the “Surya” brand, these price hikes were well accepted by the market.

With strong business acumen led by professional management, financial prudence and a “Customer First” approach, Surya Roshni has transformed both Lighting & Consumer Durables and Steel Pipes & Strips businesses as independent, self-sustaining, self-propelling businesses in terms of earnings, debt repayment and growth, leading to continuous growth in revenue and profitability along with upgrades in credit ratings.

Mr. Nirupam Sahay, ED & CEO of Lighting and Consumer Durables, has agreed to continue in order to further strengthen the Lighting and Consumer Durables business.

In the Steel Pipes and Strips Business, the company witnessed a growth of 37% YoY in Revenue driven by higher steel prices and consistent increased share of margin accretive API pipes and exports. The company continued to get consistent orders for high margin 3LPE coated API pipes. Going forward, the focus remains on increasing the share of value-added products like GI pipes, API coated pipes and exports in steel pipes and strips.

In Lighting and Consumer Durables Business, the company witnessed healthy growth across the new-age product lines. However, the sudden emergence of the 3rd wave of covid-19 impacted the consumer sentiments and led to destocking at the dealer level. This along with higher commodity prices impacted the overall growth and profitability. The company continues to focus on growing revenue share of value-added products and Smart Lighting to increase the margins further. The company’s relentless focus on bringing down the replacement cost has worked well. Company-wide initiatives were undertaken to increase productivity such as Salesforce Automation (SFA) which is being rolled out across all the regions. The company is continuously investing in marketing and advertising with a vision to transform into a modern, innovative, progressive and agile brand. The company will continue to focus on participating in multiple Smart Lighting projects in the Professional Lighting.

Surya Roshni has received approval under the ‘Large Investment’ category for manufacturing of components of LED lighting in the PLI Scheme. The capex of Rs. 25 crores to be incurred over 5 years has already started. This shall further strengthen the backward integration and will reduce reliance on imported components.

The Hon’ble Finance Minister, on 1 February 2022, has endeavoured for a simple but forward-looking Budget having substantial capex-spending with due thrust on infra and logistics development, leveraging on digital opportunities and ease of doing business through a trust-based governance. The Jal Shakti ministry has seen a sharp increase in budgetary outlays over the last two years, the total planned outlay for the ministry in the 2022-23 Union budget is ~ Rs 79,000 crore, out of which almost three-fourth has been allocated to the department of drinking water and sanitation. The river-linking projects as announced in the budget would further drive the demand for spiral pipes.

The company is witnessing multiple growth levers internally through premiumization across business segments, strengthened balance sheet, cost optimization initiatives and diversified value-proposition. This is further supported by external levers such as PLI, pick-up in economic activities and the country’s growing exports in 3LPE and GI pipes.

Mr. Vinay Surya – Managing Director, Surya Roshni, further added, “At the onset, I am grateful to our chairman and the board of directors for bestowing this responsibility on me. I along with Mr. Raju Bista will share joint responsibility and will work together in close coordination under the chairman’s leadership for the achievement of greater heights of success. Our focus would be on creating more value for all the stakeholders.

Over the years, the company has focused on creating a niche through market leadership in value-added products in the steel pipes business. The strategy has worked well for the company. Today Surya Roshni stands out as the foremost company for 3LPE Coated API Pipes & GI Pipes and enjoys a leadership position in exports markets. During Q3FY22, the company witnessed a healthy revenue growth of 29%, largely driven by robust volume growth in value-added products and higher steel prices. However, destocking at channel level inventory especially during the end of the quarter affected the overall volume growth. The impact of lesser than anticipated volume growth due to volatile steel prices had effected the profitability to some extent. The strong orderbook for exports, API coated pipes and Spiral pipes are expected to drive the growth in the upcoming quarters. This will be further supported by the commissioning of a Large-dia section pipe facility with Direct Forming Technology (DFT) at Gwalior. Financial prudence, professional management across the spectrum, working capital optimization along with a healthy balance sheet have resulted in strong cash collection and prudent purchase decisions. The company is well on track to achieve its long-term vision.”