Welspun Corp Secures Major Orders from the Middle East

Welspun Corp has recently announced a significant order from the Middle East for the supply of LSAW pipes and bends, both bare and coated. This new order adds to the company’s growing portfolio, pushing the cumulative value of line pipe orders received in India and the US to an impressive Rs 1,202 crore since their last update on May 30th.

The execution of these orders is scheduled for the fiscal years FY25 and FY26, as communicated to the stock exchanges.

Expanding Presence in Saudi Arabia

In a related development, Welspun Corp revealed last month that its associate firm in Saudi Arabia has secured multiple contracts with the oil giant Aramco, amounting to approximately Rs 3,670 crore. The East Pipes Integrated Company for Industry (EPIC), a Welspun associate, has entered into a 19-month agreement with the Saudi Arabian Oil Company (Aramco), signaling a robust expansion in the region.

Financial Performance

Following the fourth quarter results reported in May, Welspun Corp has provided a cautious revenue forecast for the fiscal year 2024-25. The company projects revenue of ₹17,000 crore, reflecting a slight decrease of 3.3% from the Rs 17,582 crore reported for the financial year 2024. Similarly, Earnings Before Interest, Tax, Depreciation, and Amortization (EBITDA) is expected to decline to Rs 1,700 crore from ₹1,804 crore.

The company’s EBITDA margin for the fourth quarter dipped to 7.4%, down from 10.3% in the same period the previous year. This decline follows a trend observed in the December quarter, where the EBITDA margin was reported at 9.7%.

Despite these challenges, Welspun Corp net profit saw a 20% increase, primarily attributed to reduced finance costs, higher other income, and lower tax obligations.

Market Performance

As of Thursday, July 25, Welspun Corp shares were trading at Rs 647 apiece, marking a 3.25% decline. However, the stock has demonstrated resilience and growth, boasting an 18.03% increase so far this year.

In summary, Welspun Corp continues to strengthen its market position with strategic orders and contracts, both domestically and internationally. While facing certain financial headwinds, the company remains focused on executing its commitments and expanding its footprint in key markets like the Middle East and Saudi Arabia.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.