Rajratan Global Wire Outlines Aggressive Expansion and Volume Growth Targets

• Chennai plant capacity set to reach 60,000 tons this quarter.
• 15-20% YoY volume growth projected for the next 10-15 quarters.

Reader Takeaway: Robust capacity expansion and global demand drive growth, but high input costs continue to squeeze EBITDA margins.

What just happened

Rajratan Global Wire has confirmed that its capacity expansion at the Chennai plant is on track for completion this quarter, reaching a capacity of 60,000 tons. Additionally, the company is planning a 50,000-ton capacity addition in Thailand for the coming year with a capital expenditure of INR 100 crore. The firm is also in the trial phase for its Pithampur steel cord project, with full-scale operations slated to begin next year pending certifications.

Why this matters

Management has provided a strong forward-looking guidance of 15-20% year-on-year volume growth for the next 10 to 15 quarters. This growth is expected to be supported by a target of over 30,000 tons in exports for India and Thailand by FY27. The Thailand facility is currently highlighted as a strategic asset due to its access to scrap-based raw materials, which provides a competitive advantage in manufacturing green bead wire for international markets.

Risks to watch

Despite strong volume projections, the company is currently facing headwinds. EBITDA margins are at their lowest point due to persistent inflationary pressures in energy, transportation, and raw material costs. Freight volatility remains a key pressure point, effectively offsetting the operational leverage the company would typically gain from its increased production scale.

What to track next

The primary focus for investors will be the successful commercialization of the Pithampur steel cord project. Furthermore, tracking whether the company can successfully pass on or absorb inflationary costs as the Chennai plant reaches its full capacity will be critical to margin recovery.