Below are a few quick points from the 1st concall. Kindly pardon in case of any mistakes
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Focus is to create a trading company in construction material space.
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Three Business verticles – B2B (steel trading), B2B (service station/center) and B2C
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B2B (steel trading): Buy steel from the big manufacturers and supply to the small businesses. Largest trader was doing business or 25K MT/month. Current SG volume 50K MT/month. Trading in HRcoils, pellets. Doing business with JSW, Sail, Tatas. Margin is 1.5-2.0%. Mostly cash and carry business
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B2B (service station/center): Buy steel from the manufacturer and process it to make ready to use steel for users like automobile, washing machine and some construction industry. Two service station already started, planning to start 3 more incl Dubai. Plan to do 30k-40k/month steel processing. Margin is 4-5%. 15-20 days inventory. 101 service station by 2030 adding 10 per year. Capex of 20-25cr for each
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B2C: To sell construction materials like TMT, welding rodes etc to customers which are already doing business with APL Apollo. This business will not include steel pipes for which APL will continue to use existing channels. Service centers will be used as warehouses for B2B and B2C. Volume of 13K/month already started, expected margins of margin 2-4%
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Brand: Family has given brand to SG Mart without any cost for doing business in construction materials other than steel pipes
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Q1 Revenue Breakup: 500cr B2B steel, 400cr B2B service station and rest B2C
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Cash: Current cash is 1000cr+ raised last year to start the business. This fund is sufficient to reach 20k MT volume.
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Guidance 2025: Top line 7k-8k with steel volume is 1.2mn and margins of 2.5% – don’t see any issue/risk
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Guidance 2026: 13-14k next year
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Guidance 2030: 50k top line, 10mn ton annual volume, 5k capital requirements, ebidta 1500 CR, ROCE of 30% by 2030
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Competition: No current listed or unlisted competition in the market.
Not invested. Tracking closely
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