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Structural tubes gaining traction under government schemes 

APL Apollo Tubes (APAT) remains our top pick given its leadership position in the industry, which is witnessing growing applications, increasing adoption for government projects, rising consumption of structural steel tubes in public infrastructure, residential and commercial buildings, warehouses, factories, agriculture and other construction works. 

*APAT’s structural steel tube was approved for one of the railway station redevelopment project under the ‘Amrit Bharat Station Scheme’, which has identified ~1,275 railway stations for redevelopment across India. This is a positive development and a huge opportunity for the industry. 

*  The Uttar Pradesh government has issued tenders to build ~60,000 water tanks using structural steel tubes, translating into an opportunity of over ~1MMT. Many other states are also planning to build such water Tank.  

APAT is playing a vital role in market creation of structural tubes across various applications. The structural tube market in India is ~8MMT and is expected to rise to ~30MMT in the longer run.

Structural tubes in railways, a big boost

* Recently the Government of India has launched the ‘Amrit Bharat Station Scheme’ for the redevelopment of railway stations and has identified 1,275 railway stations for redevelopment. This will be a continuous process over long time

*APAT’s tubular structure was approved for one of the identified stations in Andhra Pradesh.

We expect structural tubes to be one of the key components for this project owing to the following factors:

The fundamental problem for any railway renovation project is that since station operations cannot be interrupted, manufacturing and construction must be completed extremely quickly and without much disturbance in the regular operations.

 The installation and fabrication of structural tubes is easier and less time consuming; and it also reduces overall steel consumption with minimum wastage of steel, resulting in a lower project cost.

There is almost no waste in tubular constructions, while there is up to 5% to 6% waste in traditional steel structures.

A study conducted during the evaluation of structural tubes’ application for a railway station revealed that by employing cut-to-length APAT tubes, contractors can expedite the whole fabrication and installation process while decreasing the overall weight by 15-17% andA study conducted during the evaluation of structural tubes’ application for a railway station revealed that by employing cut-to-length APAT tubes, contractors can expedite the whole fabrication and installation process while decreasing the overall weight by 15-17% and lowering the project cost by up to 7-10%.

Currently, the company has received approval from one contractor for a station in Andhra Pradesh, and this contractor has also won orders for another station. Similarly, APAT is in talks with ~20 contractors who have won orders for four to five stations each across India.

In terms of volume, a railway station consumes higher tonnage (over 10kg/square feet) than a high-rise building as the dead load is high in railway stations, and also there is vibration matrix that needs to be taken into consideration. 

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