AI-generated · cited to primary sources · not investment advice · How we research
Scoda Tubes
Our verdict on Scoda Tubes isn’t the consensus take — see where we landed, and the one risk the bull case glosses over.
See the verdict — free →Does management do what it says?
The company has successfully established a hot piercing mill with a production capacity of 20,000 MTPA for mother hollows. (3 met across 3 tracked commitments)
“Hot piercing mill to produce mother hollow with a production capacity of 20,000 MTPA”
The company has deployed INR 27 crores towards capex from IPO proceeds and incurred a total of INR 45.9 crores in H1 FY26. Management reaffirmed the total estimate remains around INR 100 crores. (1 in progress, 1 exceeded, 1 met across 3 tracked commitments)
“We intend to invest INR100 crores in capital expenditure to support this growth. Out of this, INR55 crores will be allocated towards expanding our seamless production capacity and INR45 crores towards increasing our welded production capacity.”
See the full cited Management analysis of Scoda Tubes
How durable is the business?
Domestic revenue share has expanded to 73% of total sales for the full year FY25, up from approximately 68% previously. (1 expanding)
“Revenue breakup across geographies for FY '25 is as follows. India 73%, Europe 22%, America 4%, MENA and Oceanic 1%.”
Domestic revenue share has increased slightly to 71% of total revenue in H1 FY26, driven by strong demand in the power and renewable energy sectors despite a slowdown in oil and gas capex. (1 expanding)
“Revenue break-up across geographies for H1 FY '26 is as follows; India 71%, Europe 24%, America 5%.”
See the full cited Business Model analysis of Scoda Tubes
Where does growth come from?
The company is doubling its seamless production capacity from 10,068 MTPA to 20,068 MTPA, with the expansion expected to be operational by FY26. (4 accelerating, 1 new trend across 5 signals, 2 leading indicators)
“Seamless: Existing capacity 10,068 MTPA -> Post expansion capacity 20,068 MTPA. Additional capacity went live in December 2025”
The company has secured land for future growth, with 50% of its total land parcel still available for development, ensuring long-term scalability. (1 steady across 1 signal, 1 leading indicator)
“Available land parcel of 74,699 sq. mts., with only 37,156 sq. mts. currently developed for manufacturing”
See the full cited Future Growth analysis of Scoda Tubes
What could break the thesis?
EASING: Management reports that raw material prices have declined by 5% to 10% over the past 24 months and have stabilized. EBITDA margins for Q2 FY26 stood at 15.4%, showing stability compared to the previous quarter's 15.1%, with a target to maintain 15-16% through a better product mix. (1 easing, 2 intensifying, 1 high-severity)
“Gross profit margin 33.7% 30.9% -280bps ... EBITDA margin 17.8% 15.1% -270bps”
Inventory levels remain high and are increasing in absolute terms, rising from INR 111.9 crores in FY24 to INR 149.8 crores in FY25. Inventory days also increased slightly from 156 to 163 days. (5 intensifying, 1 high-severity)
“Cashflow from operations2 INR -51.0 crores (vs 22.7 crores in Q3 FY25)”
See the full cited Risk analysis of Scoda Tubes
Read the full thesis on Scoda Tubes
AI-generated informational research only. ThesisLoop is not investment advice, a stock recommendation, or a guarantee of returns.