Welspun Corporation Surges 5% on Securing Rs. 872 Crore Work Orders

Welspun Corp secures major orders worth ₹872 crore, showcasing its expertise in complex pipe projects and resilience amid global challenges, driving stock surge and future growth opportunities.

Hadeel Hashem
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Welspun Corporation Surges 5% on Securing Rs. 872 Crore Work Orders

Welspun Corporation Surges 5% on Securing Rs. 872 Crore Work Orders

Welspun Corporation Limited, a leading global welded-line pipe manufacturer, experienced a 5% surge in its stock price on April 22, 2024, following the announcement of securing work orders worth Rs. 872 crore. The company has received multiple line pipe orders in the last month, including a prestigious order for the supply of concrete-coated LSAW pipes and bends for a critical oil transportation project in the Middle East, set to be executed in FY25.

The line pipes for the Middle East project are specially designed for extreme sour service applications, showcasing Welspun's expertise in handling complex and demanding projects. The company emphasized that these orders reinforce its position as one of the top line pipe manufacturers in the world.

Welspun Corp continues to demonstrate resilience and adaptability, with the recent orders building upon its strong performance in the preceding quarters. In Q3FY24, the company reported a twelve-fold increase in profit year-over-year, further solidifying its market position.

Why this matters: Welspun Corporation's ability to secure significant work orders amidst global economic challenges highlights the company's competitive edge and the growing demand for its products in the international market. The successful execution of these projects could potentially lead to increased market share and future growth opportunities for the company.

In addition to the recent work orders, Welspun's associate company, East Pipes Integrated Company for Industry (EPIC) in Saudi Arabia, has received cumulative orders exceeding SAR 1.32 billion (Rs. 3,000 crore) over the past six months. Earlier in March 2024, Welspun Corp had also received line pipe orders worth Rs. 2,039 crore in India and the US, ensuring business continuity until Q2FY25 and reaffirming its dominant position in the US onshore gas transmission sector.

The company's step-down subsidiary, Sintex Advance Plastics, is also planning to set up a manufacturing facility for plastic pipes and water tanks in Madhya Pradesh for a total consideration of Rs. 400 crore, further expanding Welspun's product portfolio and market reach.

Welspun Corporation Limited's successful bid for the Middle East project and the recent influx of work orders demonstrate the company's strong market position and its ability to secure high-value contracts in the global welded-line pipe industry. The execution of these orders in FY25 is expected to contribute significantly to the company's revenue and profitability, while also reinforcing its reputation as a reliable supplier of quality pipes for critical infrastructure projects worldwide.

Key Takeaways

  • Welspun Corp's stock surged 5% after securing Rs. 872 crore in orders.
  • Welspun won a prestigious order for LSAW pipes for a Middle East project.
  • Welspun's Q3FY24 profit increased 12-fold, solidifying its market position.
  • Welspun's associate EPIC received SAR 1.32 billion in orders in 6 months.
  • Welspun plans to set up a Rs. 400 crore plastic pipes facility in India.