ISMT Envisioning Saleable Capacity of 2.5

lakh MT for Seamless Tubes

Started in 1977, with a unique combination of assel mills, a premium quality finishing(PQF) mill, and an integrated steel manufacturing facility, Indian Seamless Metal Tubes (ISMT) is one of the most diversified manufacturers of specialized seamless tubes. ISMT produces both hot-finished as well as cold-finished seamless tubes catering to applications such as the manufacture of auto-components, bearing races, OCTG products, drill rods, boilers, heat-exchangers, etc. Tube & Pipe India feels fortunate to converse with Mr. Nishikant Ektare, Managing Director, ISMT as he elaborates on the business plans to aggressively push and maximize capacity utilization of the steel and tube plant and invest CAPEX for various debottlenecking operations.

Tube & Pipe India: Please tell us about Indian Seamless Metal Tubes (ISMT) Limited, highlighting the company's business journey, major milestones and achievements.

Nishikant Ektare: ISMT was started by a group of technocrats for production of bearing tubes through seamless route as an import substitute in 1977 and the first plant at Ahmednagar commenced operation in 1980 with 1 assel mill and an installed capacity of 15,000 MTPA. Later the company expanded by setting up another mill of similar capacity as the demand for tubes was continuously rising. The company as part of its strategy to be self-reliant for the raw material- steel billets, decided to set up a steel plant and become a fully integrated manufacturer in 1993 when the GoI liberalized the economy. The steel plant then christened ISSAL (Indian Seamless Steels & Alloys Ltd) was commissioned with an installed capacity of 3.0 Lakh MTPA commenced commercial production in 1995. Subsequently, the company also acquired KSTL (Kalyani Seamless Tubes Ltd.) from the Kalyani group in 2000 thus marking the foray into larger diameter tubes for varied application. In the year 2005, all the 3 companies were merged and the new entity ISMT Ltd was formed. ISMT Ltd., also acquired Structo Hydraulics AB in Sweden to cater to the hydraulic segment in Europe and was a leading supplier to the large OEMs.

The company went through severe financial crises with Chinese dumping and the market slow down post 2012 and Apr-May 2023 was reeling under losses and strained operations. In March 2022, Kirloskar Ferrous acquired a majority stake in ISMT Ltd and with this the new management came on board. The management went about addressing the major concerns facing the company viz restoring positive net worth, negotiatedsourcingofRM,improvingcustomersatisfaction, aggressive market push for volumes to load the plants for full capacity utilization and also focusing on costs with a view to improve contribution. The result of these actions helped the companytoturnaroundinthevery1stquarteraftertakeover.

TPI: Kindly give a brief walkthrough of the manufacturing facilities, infrastructure and machinery setup along with the production capacity.

NE: Steel Plant at Jejuri: The company has installed a EAF (electric arc furnace) with 55 MT capacity capable of making 18 to 20 heats per day with downstream facilities of LRF( ladle refining furnace), VD/VOD (vacuum degassing), concast, rolling mill, heat treatment furnaces and supporting infrastructure like the fume extraction, oxygen plant, laboratory etc to effectively produce 3.0 Lakh MT of billets and about 1.50 lakh MT of rolled bars. About 70% of the production is for captive consumption and the balance is sold to the market for bearing and auto application. We cast billets in dia 180, 200 and 225 mm and rolled bars from 25 mm to 90 mm with varied alloy compositions. We also make super critical T9 and T91 gradesfortheboilerapplication.

Tube Plant at Nagar: The Company has an annual installed capacity of 60,000 MT for tube rolling and around 55,000 MT for finished tubes. The plant has 2 assel mills with the associated heating furnaces, finishing lines, nondestructive testing and allied facilities. The Nagar plant caters to smaller dia tubes in the size range of 16 mm to 140 mm and has the cold draw, cold pilger and the hot finish tube manufacturing facilities. The plant is equipped with all the finishing and testing equipments including heat treatment and handling infrastructure. The Nagar plant also has 2 sub divisions wherein smaller dia tubes and components are manufactured. The major segments serviced by the Nagar plant is automotive, bearing and miningindustry.

Tube Plant at Baramati: The company has an installed capacity of 3.0 Lakh MT of rolling and around 1.50 lakh MT for finished tubes. The plant has 1 assel mill capable of producing tubes from 7” to 10” and a PQF mill capable of producing from 1.5” to 5.5”. The associated infrastructure of handling, heat treatment, testing facilities are available for each of the types of tubes being manufactured whether they are cold drawn, casing, tubing or hot finish. The Baramati plant caters to a wider range of markets and serves oil & gas, power, refineries, auto, hydraulics, mining andindustrialsegments.

TPI: Please elaborate on the product range of ISMT Limited, emphasizing on their features, applications and advantages.

NE:Steel:

Features: Rolled bars from 25 mm dia to 90 mm dia also spheroidizedandannealedasrequired

Application: Varied- bearing races, automotive shafts, spindles,gears,rollersetc.

Advantages: EAF route clean steel, low Ti grades for unique bearing applications, short delivery cycles, small batchquantityandreadyavailability

Tube:

Features: Size range from 16mm dia to 273 mm dia, quenched and tempers, normalised, cold drawn hot finish, coldpilgeredetc.

Application: Across diverse segments of automotive, bearing, boilers, projects, oil & gas, general engineering, hydraulics,miningetc.

Advantages: Best in class quality, superior surface finish, traceability,highalloytubes,moderateMOQ

TPI: What kind of capacity expansions has ISMT recently undertaken and is planning in the near future? Please elaborate on the new infrastructure, machinery setup, and manufacturing and production capacity of the recent expansion.

NE: We are planning CAPEX to de-bottleneck the finishing capacities at Nagar and BMT to be able to realize the full capacity of the plant. Our endeavor is also to restore all equipment to the original working conditions after years of neglect and wear. With the planned CAPEX over 2 years we intend to take the saleable capacity to 2.5 lakh MT of seamless tubes. The major investment will be made in shed extensions, FG storage, NDT equipment, material handling,roads,drainagesandcompoundwall.

TPI: Could you elaborate on the company's vast clientele and market share?

NE: The company operates in the major segments of automotive, bearing, general engineering, hydraulics, mining, export, projects, defense, boiler, oil & gas, redrawers and trade and is Tier 1 or Tier 2 supplier to the OEMs. ISMT boasts of predominant market share in the Auto and Bearing segments and is pursuing improving market share in the Oil and Gas sectors as the market is boomingandthereexistshugeopportunities.

Ourproductsfindapplicationandaresuppliedtotheleading in the passenger &, commercial vehicle, tractor, agricultural implements, construction equipment, hydraulics, mining, defense and oil majors like ONGC, Oil India, major project companies like L&T, ThyssenKrupp and power plant equipmentsupplierslikeThermax,ISGECetc.

Presently, ISMT has a market share of approximately 17% in the seamless tube business and we have lined up plans to improveourmarketshareto>25%inthenext5years.

TPI: What according to you are the major USPs contributing to ISMT Limited's growth in the industry?

NE: Our major USP is the integrated steel manufacturing facility that gives us scope for development of new grades, shorter lead times for supply and also takes part in niche small volume business. We also can work closely and quickly for adoption of process changes and emergent requirementsofouresteemedcustomers.

TPI: As major players in the tubes & pipes industry, kindly shed some light on the current scenario, ongoing challenges and upcoming opportunities in the global and Indian tubes & pipes market.

NE: The seamless tube market in India is slated to grow at a CAGR of 7% for the next 7 to 8 years considering that most of the segments are growing whether it is oil & gas, power projects, automotive and defense. There is also huge demand coming in from North America and the Middleeast owing to the strategies of these countries to have an alternative to China. Indian seamless tube manufacturers will have to build capabilities in product development for a wide range of applications like geo-thermal and specialized oil&gastopartakeinthesebusinessopportunities. Post opening up of China after COVID 19 by October 2022, we have witnessed huge quantities of seamless tubes and rings coming into India at substantially low prices thus destabilizingthebusinessintheshortterm.

TPI: What are the company's long term and short term plans for growth in the future?

NE: Our short term goal is to aggressively push and maximize capacity utilization of the steel and tube plant and invest CAPEX for various de-bottlenecking operations. As part of a long term strategy, we would foray into seamless tubes larger than 10” dia and necessary investmentswillbemadeinthecomingyears.

Vishal Pipes Envision Escalation of 75% in Overall Production Capacity

Incorporated in 1988, Vishal Pipes

Limited is a leading manufacturer of steel pipes and tubes, steel poles, steel structures with medium to heavy fabrication, polymer pipes, UPVC, CPVC, HDPE and MDPE pipes and LED lights. The organization has its headquarters in New Delhi with an integrated manufacturing unit spread over 1,50,000 sq. m. in Sikandarabad, Greater Noida part II, Uttar Pradesh. It has an annual production capacity of around 216,000 TPA for steel production, over 18,000 TPA for HDPE pipes production, and 10,000 TPA for PVC pipes production. In a recent interaction with Mr. Radhey Shyam

Agarwal, Managing Director, Vishal Pipes Limited shared about the company's business journey, certifications, manufacturing facilities, product range, vast clientele and global market trends in the tubes and pipes industry.

TPI: Kindly share the business journey of Vishal Pipes, outlining the major milestones and achievements.

Radhey Shyam Agarwal: Vishal Pipes Limited was incorporated in 1988, with the core business of manufacturing GI pipes. Today, 38 years since its incorporation, Vishal Pipes has emerged as one of the leading manufacturers of steel and polymer products. We started our journey with value addition by establishing our first galvanizing unit in 1988, and gradually started steel tube manufacturing in 1990. With the intention to conquer the international market, we divulged into export in 2004. In 2007, we introduced our steel fabrication division along with the establishment of steel and PVC conduit pipes. The establishment of our second galvanizing unit was marked in 2010, introducing the deep well hand pump on our product list. As our company was mastering steel pipes production, we decided to venture into HDPE manufacturing in 2014. The year 2015 marked the introduction of powder coated GI pipes and steel bridge girders and structures for solar module mounting.

TPI: Please give us a brief walkthrough of the company's manufacturing facilities, infrastructure and machinery setup along with existing production capacity?

RSA: The organization has its headquarters in New Delhi with an integrated manufacturing unit spread over 1,50,000 sq. m. in Sikandarabad, Greater Noida part –II, Uttar Pradesh. All our units are ISO 9001, ISO 14001, ISO 18001 and CE/UL certified and equipped with state-ofthe-art plant and machinery, with quality control laboratory and equipment, PLC controlled CNC machines. Vishal Pipes has an annual production capacity of around 216,000 TPA for steel production, over 18,000 TPA for HDPE pipes production, and 10,000 TPA for PVC pipes production.

TPI: Please elaborate on the product range of Vishal Pipes, emphasizing on their features, applications and advantages.

RSA: Vishal Pipes is leading manufacturer of steel pipes, hollow sections, tubular poles for various applications likewater and sewage, non hazardous gas, air and steam, structural purposes, steel idlers, water wells and borings, electrical conduit, GI pipes powder coated for city gas distribution. All of these products are BIS approved and hold standards in compliance with requisite regulatory governing the norms. We also manufacture CORE approved - galvanized ERW steel tubes, counter weight guide tubes and many more steel and polymer products. In thisway,ourproductsaregraduallygainingthesatisfaction ofalargenumberofcustomers.

TPI: Kindly tell about the vast clientele of Vishal Pipes - both Indian and globally.

RSA: The presence of Vishal Pipes is visible throughout the country. Our major clientele are MNCs like Larsen & Toubro, ABB, Isolux Corsán, Alstom, General Electric, Siemens, Areva, Grupo Cobra and ETA Engineering.

Vishal Pipes also serves the Indian PSUs like IOCL, NTPC, Indian railways, BHEL, COAL India, IRCON International, CORE, PGCIL, GAIL and GSPC and state bodies like UP Jal Nigam, Public Welfare Department, RUIDP, UP Discoms, UP Agro, CIDCO, Maharashtra Gas, Indraprastha Gas and NDPL. Corporate companies catered are Kalpataru Power, KEC International, TATA projects, WAAREE Energies, Havells India, Torrent Power, Adani Power, Cimechel Electric, Reliance Infra and Crompton Greaves.

TPI: Kindly tell us about the growth and capacity expansion at Vishal Pipes. What according to you are the major USPs of Vishal Pipes contributing to the company's growth?

RSA: With latest cutting edge technology, innovation and machinery from the esteemed companies like Larsen and Toubro, Shapoorji Pallonji group; Vishal Pipes has a steep inclination towards expansion of the production capacity. In the previous financial year, Vishal Pipes showcased a remarkable 30% increase in production and a rise of 25% is assured in the current year. Also an escalation of 75% in overall production capacity is inevitable considering the growth charts. Vishal Pipes is a benchmark and renowned name in the field of manufacturing and exporting pipes and steel structures. Our products rank the highest in quality and are recognized by many national and international standards. Our company has consistently maintained itself as a one stop solution for all kinds of pipes, steel pipes and tubes, steel poles, steel structures and polymer pipes. Adhering to the organizational core values of empathetic decision making, integrity, accommodating diversity, Vishal Pipes has benchmarked the entire product line and has achieved satisfaction of a large number of customers within India and globally.

TPI: Kindly shed some light on the current scenario, ongoing challenges and upcoming opportunities in the Indian and global tubes & pipes markets.

RSA: The global steel market size reached USD 907 billion in 2022. The international researchers expect the market to reach USD 1077 billion by 2028, exhibiting a growth rate (CAGR) of 2.8% during 2023-2028. Globally through 2026, demand for pipe products in the US is forecast to increase 2.2% per year to USD 57.9 billion, equivalent to 12.9 billion linear feet. Primarily the growth of the real estate industry has contributed positively towards demand for steel, PVC and HDPE pipes where requirements are steep. Furthermore, the sector has become more organized leading to focus on infrastructure and urbanization.

TPI: What is the company's vision, mission and strategy for growth in the future?

RSA: Vishal Pipes aims to continuously improve the quality of products, enhance productivity and introduce new products by utilizing the best practices in processes and technologies. Our mission is to accomplish our vision through decency, innovation, worldwide span, ethical values & business morals. This has positively contributed towards productivity of organization and welfare of society at large. Our long term growth plan aligns with our motto of “VISHAL”