Summary:
Indian steel pipe makers such as Welspun Corp, Jindal Saw, Man Industries and Ratnamani Metals & Tubes could benefit from rising oil, gas, water and energy infrastructure spending in West Asia. Their expanding manufacturing presence and strong order books in Saudi Arabia and the UAE provide significant growth opportunities. However, geopolitical risks, supply-chain disruptions and rising competition could pressure margins.
Growing geopolitical tensions in West Asia are giving Indian steel pipe makers a reason to celebrate as countries seek to develop pipelines to free the region from its reliance on maritime shipping lanes for oil, gas, and water. Firms like Welspun Corp, Jindal Saw, Man Industries, and Ratnamani Metals & Tubes are witnessing an opportunity to diversify their presence in Saudi Arabia and the UAE, as the latter looks to lessen its dependence on vulnerable maritime trade routes like the Strait of Hormuz.
This geopolitical risk is, however, only a catalyst for a much broader market need. The Kingdom, the UAE, and other Gulf states are currently investing billions in oil and gas infrastructure, desalination plants, water networks, and energy security, and consequently, there arises a need for pipes of all sizes and types.
Welspun Corp Sees Growth Opportunities in the Saudi Market
Welspun Corp has a significant presence in the Kingdom through its manufacturing operations, and with ₹24,750 crore worth of global orders as of end-Q1FY27, management expects demand for line pipes to remain robust in the region. This is primarily because the country is looking at ramping up its energy production and building alternate transportation infrastructure.
Meanwhile, Welspun’s revenue from operations stood at ₹4,081 crore in Q1FY27, and with ₹1,046 crore net profit, the firm recorded nearly 3X jump in earnings compared to the same period last year. With visibility across energy infrastructure needs in India, Saudi, and the US, the company is well-placed to capitalize on this regional demand boom.
Jindal Saw Looks to Make Inroads in the UAE and Saudi Markets
Jindal Saw is looking to benefit from the demand for energy infrastructure as it sets up shop in Abu Dhabi with a 3 Mn tonnes seamless pipe-making facility. The company is eyeing repeat orders from oil and gas majors in the UAE and is also targeting the Saudi market. It should be noted that the company is also setting up additional steel pipe manufacturing facilities in Saudi with an aggregate capacity of 6 Mn tonnes. These would cater to the demand for water, oil and gas infrastructure.
The company stands to benefit from being able to serve some of the region’s largest energy firms closer to the point of consumption as opposed to having to rely on imports from India. In turn, this should reduce logistics costs and delivery times.
Man Industries and Ratnamani Bolster Presence in the Kingdom
Man Industries acquired National Pipe Company (NPC) in Saudi Arabia for about ₹1,000 crore in May this year. This acquisition gives Man Industries access to the Kingdom’s energy and water infrastructure needs with NPC’s 430,000 tonnes capacity.
On the other hand, Ratnamani Metals & Tubes has set up a joint venture with Saudi Electric Supply Company called Ratnamani Middle East Company. As per the shareholding structure, Ratnamani holds 75%, while its Saudi partner holds 25%. The company has also been able to get a manufacturing facility sanctioned in Dammam, which would commence operations by 2028. It would supply specialized steel tubes and pipes to the local market and the Gulf Cooperation Council (GCC) countries. The products would be used in downstream energy, petrochemicals, oil and gas, desalination, and various industrial infrastructure projects.
Indian Steel Pipe Stocks Are Surging on West Asia Demand
The growth story of West Asia’s infrastructure development has already reflected in the stock prices of the Indian steel pipe majors. Welspun Corp has witnessed a 133% gain in its share price this year, Jindal Saw is up by 59%, while Man Industries has gained by 52%. Man Industries reported record earnings in August, and its shares hit their highest levels ever as positive sentiment around its Saudi venture grew. On the other hand, while Ratnamani has underperformed throughout the year, with its shares down by about 1.3%.
Looking ahead, the market’s attention will turn to whether the order books of these firms will convert into revenues and profits. At the same time, there are risks that firms’ profitability will come under pressure due to geopolitical headwinds, disruptions in the supply chain, and heightened competition, including international players that are considering setting up manufacturing facilities in the Kingdom.
