In conversation with Pranav Bansal, MD and CEO of Bansal Wire Industries Limited

Our capital expenditure strategy is designed to support our growth initiatives while ensuring compliance with regulatory standards, thereby positioning us for long-term success in the industry, articulates Pranav Bansal, MD and CEO of Bansal Wire Industries Limited.

What factors contributed to the company's remarkable success, achieving a stellar 49 per cent year-on-year revenue growth and an 82 per cent surge in net profit in Q1FY25?
In this quarter, the primary driver of our growth has been volume. While there has been a modest increase in commodity prices, approximately 5-7 per cent of our growth can be attributed to the rise in volume. This is also linked to the completion of our new plant, which has contributed significantly to our expansion.

This remarkable growth is just the beginning for us; we are optimistic about the outlook for the remainder of this year and future quarters. Our production has ramped up, currently operating at only 5-10 per cent capacity utilisation in our new facility. We have set ambitious goals to increase our capacity by 2.5 times, which will enable us to achieve even better results.

All these factors not only support our current growth but also position us for success in our future endeavours.

As the company proudly claims to have over 3,000 SKUs, the highest among all steel wire manufacturers in India, could you provide an overview of the product mix and the performance across different segments?
Our company takes immense pride in offering over 3,000 SKUs, a key factor in our leadership in the Indian steel industry. We provide a wide range of products, including GI Wire, Cable Armour, Spring Wire, Roping Wire, Auto Cable, SS Kitchen products, ACSR, and SS Fasteners.

We are honoured to serve a diverse customer base of more than 5,000 clients across various sectors, including automotive, consumer durables, infrastructure, and power cables. The majority of our sales come from northern and western India, particularly in the regions of Delhi, Haryana, Maharashtra, and Uttar Pradesh. Additionally, we export approximately 14 per cent of our products to vital markets in the US and Europe.

Our robust manufacturing capabilities support this extensive range of SKUs. With a total manufacturing capacity of 4,11,000 MTPA and a production output of 3,47,000 MTPA, we are operating at an impressive utilisation rate of 84 per cent. These factors have collectively helped establish us at the forefront of the industry.

Could you elaborate on the company’s five-pronged strategy?
Our company’s five-pronged strategy is designed to drive maximum growth and help us achieve our milestones.

We aim to expand our presence across India. While we have a strong foothold in the north, we are targeting growth in the west, east, and south, particularly in states like Maharashtra, Gujarat, and Tamil Nadu, where significant potential remains untapped.

We are committed to increasing our exports. With the global shift away from China, we see a great opportunity to grow internationally, especially in Europe and the U.S. We are introducing innovative products, such as wires for elevator ropes and springs, to capture a larger market share.

We plan to enter the retail space. Following our success in Gujarat with agricultural products, we aim to replicate this model nationwide, allowing us to reach consumers directly and capitalize on the high-margin retail market.

We aim to improve our profit margins is a key focus. We are prioritizing high-margin speciality wire products and expanding our production capabilities by setting up new facilities and introducing speciality wires for the automotive industry, which we expect will significantly enhance our margins.

Lastly, we are investing heavily in technology to stay ahead of industry trends. We have upgraded our manufacturing processes with faster machinery, automation, and energy-efficient solutions, ensuring we align with the sector's emphasis on sustainability and efficiency.

Are there any plans for capital expenditure in the near future?
Yes, we have plans for capital expenditure soon. We are committed to investing in newer technologies to enhance our operational efficiency and product offerings. Additionally, our plans for expansion into new geographical regions will require significant capital investment to support these ventures, allowing us to increase our market presence and improve our distribution capabilities.

As we move forward, we anticipate additional capital requirements, which may be met through debt or equity financing, ensuring we have the necessary resources to execute our strategies effectively. Furthermore, to comply with increasingly stringent environmental regulations, we will need to allocate capital to meet these requirements, ensuring our operations align with sustainability goals.

Overall, our capital expenditure strategy is designed to support our growth initiatives while ensuring compliance with regulatory standards, thereby positioning us for long-term success in the industry.

What is your perspective on the future outlook for the iron and steel products industry in India?
The future of India's iron and steel industry looks promising, both for growth and for our company. The global shift from China-centric manufacturing to the "China Plus One" strategy is creating new opportunities for Indian manufacturers. Our company has strategically focused on exports, with Europe and the U.S. accounting for over 70 per cent of our total exports in Fiscal 2024, totalling Rs 2,839.41 million.

The Product-Linked Incentive (PLI) scheme aims to boost domestic production and reduce reliance on imports, particularly in speciality steel. This aligns with the Atmanirbhar Bharat campaign. India’s robust GDP growth, coupled with rising urbanization and population, is expected to drive strong steel demand across sectors like construction, infrastructure, and automotive, with projected growth rates of 10-12 per cent in the upcoming fiscal year. As the second-largest global steel producer, India has significant potential to enhance its export footprint while meeting increasing domestic demand.

We are actively leveraging our globally accredited products to expand exports, introducing high-potential items like wire for elevator ropes and springs. Domestically, we are entering the retail segment in agriculture, aiming to replicate our successful Gujarat model. Furthermore, we are implementing technological advancements in our manufacturing facilities to enhance productivity and maintain high product quality, aligning with industry trends towards greater efficiency and standards.