Welspun Corp has signed a Memorandum of Understanding (MoU) with Saudi Aramco to set up an advanced Longitudinal Submerged Arc Welded (LSAW) line pipe manufacturing plant in Saudi Arabia. This announcement was made during the Aramco IKTVA Forum & Exhibition 2025 in Dhahran, marking a significant leap in Welspun Corp’s global footprint, particularly in the bustling energy sector of the Middle East.
A New Chapter in Dammam
The proposed plant will nestle in Dammam 3rd Industrial City, with plans to produce 3,50,000 metric tonnes each year. The company is planning to start operations by mid-2026, which is perfect timing to meet Saudi Aramco’s growing demand for advanced pipeline solutions. This development is not only for oil and gas but also for hydrogen transmission and Carbon Capture, Utilization, and Storage (CCUS). Welspun is positioning itself at the forefront of the energy transition, aligning its capabilities with global trends.
Welspun and Saudi Aramco Deal
This MoU will strengthen a two-decade-old partnership between Welspun Corp and Saudi Aramco. The company has consistently delivered on pipeline projects, carving out a reputation as a go-to supplier for Saudi Arabia’s energy infrastructure. According to Welspun’s regulatory filing, “The new LSAW line pipe plant will boast cutting-edge tech to meet Aramco’s future pipeline demands, enhancing transmission efficiency for oil, gas, hydrogen, and CCUS projects.” The Dammam location is strategic, promising to streamline logistics and boost production efficiency.
Market’s Reaction to the News
On 15 January 2025, the stock opened at INR 749.50 on the BSE, a 2.7% uptick from INR 729.70 the day before. By mid-morning, it hit INR 777.05, marking a 6% increase. The following day, January 16, the stock is trading around INR 782.00 per share, showing continued investor confidence with a 2.89% rise. Over the last year, Welspun has seen a 17% growth in share value, outstripping the Sensex’s 4.3%.
As of 16 January 2025, Welspun’s market cap sat at INR 20,567 crore, with shares fluctuating between a high of INR 835 and a low of INR 440 over the year. Welspun’s partnership with Aramco not only bolsters Welspun’s market standing but also sets the stage for further innovation and expansion.
Welspun’s Recent Development
- Saudi Facility Green Light: Back on 8 November 2024, Welspun’s board gave the thumbs up for this Saudi venture through its wholly-owned subsidiary.
- Global Player: The company has tackled some of the most daunting pipeline projects globally, from the deepest to the longest, showcasing not just muscle but brain in engineering.
- Another Plant in Gujarat: Alongside this, Welspun is constructing a massive 5,00,000 MT per annum Ductile Iron (DI) pipe facility in Anjar, Gujarat, with all sorts of modern tech like blast furnaces and sinter plants.
Looking Ahead
Welspun’s partnership with Aramco is a strategic play for long-term growth. Welspun is now better equipped to fulfil the global demand for advanced energy infrastructure, especially in the resource-heavy Middle East. With this new facility, Welspun’s capacity will expand and play a pivotal role in the global shift towards sustainable energy solutions, ensuring long-term value for its stakeholders while reinforcing its leadership in the energy sector.
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