Aether Industries Limited — Q3 FY26

Aether Industries Ltd Q3 FY2025-26 Earnings Conference Call https://www.youtube.com/watch?v=2e78dQbZBYM Published: 3 months ago

0:02 2 seconds Ladies and gentlemen, good day and welcome to Ather Industries Limited Q3 F526 earnings conference call. As a 0:10 10 seconds reminder, all participant lines will be in the listen only mode and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance 0:19 19 seconds during the conference call, please signal an operator by pressing star then zero on your touchstone phone. Please note that this conference is being 0:27 27 seconds recorded. I now hand the conference over to Mr. Nillesh from SDFC securities. Thank you and over to you Mr. G. 0:36 36 seconds Yeah, thank you Renju. Good afternoon all. On behalf of SDFC securities, I welcome everyone to this Ather 0:44 44 seconds Industries conference call to discuss the results for the quarter ended December 2025 and 9 months of the financial year 202526. 0:54 54 seconds From the Aether Industries, we have with us today Dr. Mr. Aman Desai promoter and wholetime director Mr. Rohan Desai 1:02 1 minute, 2 seconds promoter and wholetime director Mr. Faz Nagara chief financial officer Mr. 1:08 1 minute, 8 seconds Kushal Doshi U lead investor relations and Miss Shubangi Desai executive IR 1:15 1 minute, 15 seconds without further ado I will now hand over the floor to Mr. Kushal Doshi to begin with the earnings for the quarter 3 FY26 over to you Kushell. 1:26 1 minute, 26 seconds Thank you Nesh. A warm welcome to everyone. Uh today our board has approved the financial results for the third quarter and 9 months of financial 1:34 1 minute, 34 seconds year 2026 and the same has been filed with the exchanges as well as updated over our website. Please note that this 1:41 1 minute, 41 seconds conference call is being recorded and the transcript of the same will be made available on the website of Aether Industries Limited and the stock exchanges. Please also note that the 1:50 1 minute, 50 seconds audio of this of the conference call is the copyright material of Aether Industries Limited and cannot be copied, rebroadcasted or attributed in press or 1:58 1 minute, 58 seconds media without specific and written consent of the company. Let me draw your attention to the fact that on this call our discussion will include certain 2:06 2 minutes, 6 seconds forward-looking statements which are predictions, projections or other estimates that uh about the future events. These estimates reflect 2:15 2 minutes, 15 seconds management's current expectations on future performance of the company. 2:19 2 minutes, 19 seconds Please note that these estimates involve several risks and uncertainties that could cause our actual results to differ materially from what is expressed or 2:28 2 minutes, 28 seconds implied. Aether Industries Limited or its officials do not undertake any obligation to publicly update any forward-looking statements whether as a 2:36 2 minutes, 36 seconds result result of future events or otherwise. Now, Mr. Dr. Rohan Desai will begin by sharing Ather's business 2:42 2 minutes, 42 seconds outlook ongoing expansion. Then Dr. Aman Desai will provide inputs on the R&D and new planned initiatives and strategy of 2:50 2 minutes, 50 seconds the company going forward and Mr. Fees Nagara will cover the financial highlights for the period under review. 2:56 2 minutes, 56 seconds Now I hand over the call to Mr. Ruan Desai for his opening remarks. Over over to you. 3:03 3 minutes, 3 seconds Good evening everyone. I hope everybody is doing well and I'm glad to connect with you all to discuss the performance of our company for quarter 3 of financial year 2026. 3:14 3 minutes, 14 seconds I am delighted to inform you that the construction and installation of site 3+ and the first two production blocks of 3:21 3 minutes, 21 seconds site 5 has been completed and water plus solvent trials have been commenced. 3:27 3 minutes, 27 seconds Commercial productions from these sites will commence shortly. The three business verticals continue to perform well even though global environment 3:35 3 minutes, 35 seconds continues to remain volatile. Last quarter we have seen 43% of the sales from contracts less 3:42 3 minutes, 42 seconds exclusive manufacturing, 41% from large scale manufacturing and 8% from contract 3:50 3 minutes, 50 seconds research and manufacturing services. Our export revenue stood at 36% of the total revenue and the domestic sales stood at 64%. 4:01 4 minutes, 1 second In terms of the sectoral spread for the quarter third, pharma and agro is now contributing only 45% combined while oil 4:10 4 minutes, 10 seconds and gas and material science contributes 22% and 18% respectively. As mentioned in the previous call, we expect share of 4:19 4 minutes, 19 seconds oil and gas and material science to scale up by the year end. In large scale manufacturing business vertical the 4:27 4 minutes, 27 seconds demand of our product remained robust while price has remained stable in the quarter. Volume growth has been over 10% 4:36 4 minutes, 36 seconds quarteron quarter basis and over 25% year-on-year basis. 4:43 4 minutes, 43 seconds We have we we have added three new products in the large scale manufacturing vertical from site five 4:50 4 minutes, 50 seconds which are targeted towards pharmaceutical and agrochemical sectors. 4:55 4 minutes, 55 seconds Validation quantities have been sent out from the other plants. We have planned to launch the commercial production 5:03 5 minutes, 3 seconds shortly in site five. All the three products will be manufactured for the first time in India and are currently 5:10 5 minutes, 10 seconds priced between $30 to $40 per kilo. In the quarter, we have added five new market clients. 5:18 5 minutes, 18 seconds Sales from site 4 in this quarter have increased to 60 kores as compared to 50 kores in quarter 2 of 5:26 5 minutes, 26 seconds financial year 2026 representing a impressive 20% growth quarteron quarter. 5:32 5 minutes, 32 seconds The current rate is expected to continue for the financial year 2026 and we see an increase in the trend in financial year 2027. 5:43 5 minutes, 43 seconds The increase in volume is expected as we start to supply to more of the of the 5:50 5 minutes, 50 seconds sites of big use and we are looking to add more products which are currently in cramps and increase our wallet share. KO 5:59 5 minutes, 59 seconds polyol continues to see uh an increase in sales in this quarter and we are on track to achieve our targets in financial year 2026. 6:09 6 minutes, 9 seconds We are pleased to inform you that despite the volatile macro environment, we see a number of customers inquiry increasing for this particular product. 6:19 6 minutes, 19 seconds The acceptability and adaptation of the product makes us optimistic for financial year 2027 as we continue to 6:27 6 minutes, 27 seconds further research on converge polyhol to see how the product can be adopted by 6:34 6 minutes, 34 seconds companies which were not in search to as a customer earlier. 6:40 6 minutes, 40 seconds Our contract with Osuka chemicals is on track and we are expected to achieve a target of 35 to 40 crores of sales in financial year 2026. 6:50 6 minutes, 50 seconds In site five we have for into electronic chemicals specifically related to semiconductor industry. The clients 6:58 6 minutes, 58 seconds which we'll be supplying are based in Japan, South Korea and Taiwan. The validation basis for this chemicals have 7:05 7 minutes, 5 seconds been dispatched already. In summary, we are extremely excited as we look to commence site three 7:15 7 minutes, 15 seconds sorry uh we look to commence three production blocks uh in site 3+ and site 5 respectively at 7:25 7 minutes, 25 seconds ather and our company becoming a preferred partner not only in R&D but also for commercialization of our 7:33 7 minutes, 33 seconds products. With this I would like to conclude speaking and I would like I would request Dr. Roman to touch upon R&D and new client initiatives for this period. Over to you Aman. 7:44 7 minutes, 44 seconds Thank you Rowan. Um good evening everybody. Um I hope all are doing well and I'm very happy to connect with you again um at the end of a promising 7:53 7 minutes, 53 seconds quarter. Uh I think the last few months we have been extremely busy at Ather. Uh 8:00 8 minutes site 3 plus as well as the first two production blocks of site 5 will both 8:07 8 minutes, 7 seconds more or less simultaneously commence commercial production in the very near future. So both site 3 plus and the 8:14 8 minutes, 14 seconds first two blocks of site 5. At the same time we are also doing R&D expansion. So we are doing two R&D expansions. We are 8:21 8 minutes, 21 seconds doing a short-term R&D expansion and a long-term R&D expansion. In the short-term R&D expansion, right away in the next couple of months itself, we are 8:29 8 minutes, 29 seconds installing 20 additional fume hoods in the existing facility. A major part of which will be engineering labs uh similar to what we talked about in the 8:38 8 minutes, 38 seconds last quarter. At the same time, we are also doing a long-term R&D expansion where we are installing 15 additional 8:45 8 minutes, 45 seconds labs, 150 fume holes, out of which five will be engineering labs. And we are also going into advanced uh very um 8:53 8 minutes, 53 seconds modern um cutting edge analytical equipment like NMR nuclear magnetic resonance spectroscopy. the engineering 9:00 9 minutes labs that is both in the short-term and the long-term expansions of the R&D will help us to focus much more on chemical engineering chemical technology and 9:09 9 minutes, 9 seconds scaleups from the R&D itself which will enable us to further tap into what our current focus in crams is which is 9:16 9 minutes, 16 seconds non-farma and non-aggro oil and gas and material sciences these sectors require much more chemical engineering at the 9:23 9 minutes, 23 seconds inception of R&D uh along with organic chemistry and that's what the expansions in the R&D are going to be focused on 9:30 9 minutes, 30 seconds the site one as it stands the R&D center is fully tapped fully utilized today and that's why we made the decision of doing 9:38 9 minutes, 38 seconds this short-term expansion of 20 fume hoods along with the long-term expansion of the double expansion that we are doing in the R&D over the last few 9:46 9 minutes, 46 seconds months moving on to the interactions with customers uh especially Europe it is becoming increas increasingly evident 9:54 9 minutes, 54 seconds to us that the manufacturing and chemical manufacturing in Europe is being especially hard hit as a result in 10:02 10 minutes, 2 seconds the current environment a number of plants are being shutting down in the Europe increasingly so customers are looking to partner with reliable 10:10 10 minutes, 10 seconds partners in India. The choice is definitely India and we are seeing a clear urgency and uh expedition of 10:18 10 minutes, 18 seconds finalizing the contracts which we have been iterating and reiterating over the last few quarters. We are discussing significant contracts, significant 10:25 10 minutes, 25 seconds ventures with the biggest chemical companies in Europe today. And you will see all of these pan out over the next few months, the next few quarters uh in 10:34 10 minutes, 34 seconds the u announcements that we make. As mentioned by Rohan, not only have we entered into a CM exclusive contract 10:42 10 minutes, 42 seconds manufacturing contract with electronic chemicals related to semiconductors, but we have also entered into a CM contract with a European u one of the largest 10:51 10 minutes, 51 seconds chemical companies in Europe targeting the material science sector. This contract although it is small right now is on its way to becoming a significant 10:59 10 minutes, 59 seconds large contract going forward within the next one year itself. One production line in site three which currently 11:06 11 minutes, 6 seconds houses LSM projects is currently being modified to house this particular CM contract with the European multinational 11:13 11 minutes, 13 seconds customer. This will help us in improving the cap capacity utilization of this plant in the site 3 as well as save us 11:20 11 minutes, 20 seconds time in setting up new capacity in the existing customers. uh the the business and the projects with Baker Hughes are ongoing significantly well. Uh we are 11:29 11 minutes, 29 seconds adding new products and new projects there and the site 3 plus as I mentioned earlier with Milikin is uh going to shortly commence commercial production 11:38 11 minutes, 38 seconds in the very very near future. So uh we have a handsful uh the sites are busy and we are expanding on all sites of 11:46 11 minutes, 46 seconds site one, site three and site five. And with this robust pipeline that we today have in creme, we are quite confident of 11:54 11 minutes, 54 seconds being able to fill up all these assets and fill up all these sites in the very near future with uh innovative customers in exclusive relationships with multinationals and innovators across the 12:02 12 minutes, 2 seconds globe and with uh our own business model of large scale manufacturing which are the first time uh made in India products. So let me uh stop talking 12:11 12 minutes, 11 seconds happy to answer your questions as they come and uh hand over the call to FZ now who will give you an overview of the financial highlights and uh over to you FZ. 12:24 12 minutes, 24 seconds Thank you Dr. Aman and good evening everybody. 12:28 12 minutes, 28 seconds I'm glad to present the financial results of Ether Industries Limited for Q3 and 9 months of financial year 26. 12:35 12 minutes, 35 seconds The consolidated revenue from operations of the company stood at rupes 3,171 million in Q3 of financial year 26 as 12:43 12 minutes, 43 seconds against rups 2,197 million in Q3 of financial year 25 which is an increase of 44% yearonear. This has resulted in 12:52 12 minutes, 52 seconds ea of rups 1,83 million in Q3 of financial year 26 as against rups 620 million in Q3 of financial year 25 which 13:01 13 minutes, 1 second is an increase of 75% in comparing quarters. 13:05 13 minutes, 5 seconds ITA margin stood at 34% in Q3 of FI26 as against 28% in Q3 of FI25. The PD 13:13 13 minutes, 13 seconds amounted to rupees 645 million in Q3 of financial year 26 as against rupes 434 million in Q3 of financial year 25 which 13:21 13 minutes, 21 seconds is an increase 49% yearonear. The PAT margin stood at 20% in Q3 of financial year 26 as against 18% of Q3 of 13:30 13 minutes, 30 seconds financial year 25. The consolidated revenue for from operations of the company stood at rupes 8,534 million in 13:37 13 minutes, 37 seconds 9 months of financial year 26 as against rups 5,985 million in 9 months of financial year 25 which is a 43% increase in the comparing 13:46 13 minutes, 46 seconds 9 months. The beta of rups 2716 million in 9 months of finance 26 is against rupees 1,525 million in 9 months of 13:56 13 minutes, 56 seconds finance 25 which is an increase of 75% in the accompanying 9 months. All this has resulted in PAT amount of rups 1,655 14:04 14 minutes, 4 seconds million in 9 months of financial year 26 as against rupes 1,81 million in 9 months of finance year 25 which is a 53% 14:11 14 minutes, 11 seconds increase in comparing 9 months. P margins stood at 19% in 9 months of financial year 26 as against 17% in 9 months of financial year 25. 14:21 14 minutes, 21 seconds The remaining claim for the fixed assets for the loss has been put up to the insurance surveyors along with loss of profit claim and we are confident to get the same settle by the insurance company 14:29 14 minutes, 29 seconds by by or before the end of finance year 26. 14:34 14 minutes, 34 seconds The networking capital cycle remains at 160 days as against 149 days as on September 3025 mainly because of inventory built up for the start of site 14:42 14 minutes, 42 seconds 3++ and site 5 which are expected to begin from March 26. The capacity utilizations at all plant standards 14:49 14 minutes, 49 seconds under site 2 it's 76% site 3 70% and site four it's 49%. These are progressing as per the strategic 14:57 14 minutes, 57 seconds planning done by the company. Thank you once again and we look forward to better outs outcomes than this in future as well. Back to you Kush. 15:04 15 minutes, 4 seconds Uh thank you P. We shall now request the moderator to open the forum for question and answers. 15:12 15 minutes, 12 seconds Thank you. We will now begin the question and answer session. Anyone who wish to ask a question may press star and one on your touchtone telephone. If 15:20 15 minutes, 20 seconds you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handsets while asking a question. Ladies 15:28 15 minutes, 28 seconds and gentlemen, we will wait for a moment while the question Q assembly. 15:35 15 minutes, 35 seconds The first question comes from the line of Sajel Kapoor with antifracy thinking. Please go ahead. 15:42 15 minutes, 42 seconds Yeah. Hi, thank you for taking my questions. Uh given the novel scale up chemistry skills are scarce in India and 15:50 15 minutes, 50 seconds attrition risk is structurally higher um across the industry. How does Ather treat talent retention as a core 15:57 15 minutes, 57 seconds priority and what hard tradeoffs has management consciously made in favor of um employee continuity? That's my first question. Thank you. 16:08 16 minutes, 8 seconds Hi Sashin, thank you for the question. A very relevant question. uh uh companies all over the country in the chemical space are expanding and uh talent 16:16 16 minutes, 16 seconds recruitment and retention is one of the topmost priorities should be one of the top topmost priorities and is one of the topmost priorities with us. We spend a 16:25 16 minutes, 25 seconds lot of time at the management level at the family level focusing on this issue. 16:29 16 minutes, 29 seconds Uh we have a lot of efforts that we um undertake including attractive resops, attractive uh packages uh other 16:38 16 minutes, 38 seconds benefits, other incentives across the company at all levels starting from the workers to the top management um where 16:45 16 minutes, 45 seconds the focus is retention focuses retention of the talent once they are in and also we are very very careful and uh curative 16:53 16 minutes, 53 seconds when it comes to the selection of the uh candidates uh into the team and into the Aether And uh we are in a city of Surat 17:03 17 minutes, 3 seconds which is which is a nice city to live in. We are right in the middle of an industrial belt that starts from Mumbai and ends at Amedabad and sort of is the largest city in the middle. We have good 17:12 17 minutes, 12 seconds schools, good colleges uh in and around the city and a lot there's a lot of factors that we think of and this has been the focus of the company for the 17:20 17 minutes, 20 seconds last 13 years is uh finding the top talent and then retaining the top talent. 17:27 17 minutes, 27 seconds That's wonderful. Good to good to hear that um Dr. Raman and my second question is you know when scaleup experiments 17:34 17 minutes, 34 seconds fail timelines sometimes slip uh or customer expectations rise how does Aether's culture show up on the ground I 17:43 17 minutes, 43 seconds mean what behaviors from leaders and management signal you know psychological safety for employees and trust um during 17:52 17 minutes, 52 seconds these um high stress moments perhaps for for some of the employees who are actively engaged in those experiments 17:58 17 minutes, 58 seconds where because experiments by definition are uncertain. So in that context I mean you know what sort of cultural 18:06 18 minutes, 6 seconds attributes can one see or experience on the ground because ultimately it's the culture that um is um one of the key 18:15 18 minutes, 15 seconds differentiators in the fabric of any organization. Thank you. 18:20 18 minutes, 20 seconds Thank you. happy to uh answer questions uh which are not linked to uh ratios and 18:28 18 minutes, 28 seconds numbers and ROC's uh but jokes apart uh great very relevant question um we uh the the direct answer I think is that we 18:36 18 minutes, 36 seconds lead from the top um the uh we our our family and our promoter family is a mix of techno commercial excellence uh our 18:45 18 minutes, 45 seconds chairman and managing director Rashid Desai our father is a chemical engineer I am a chemical engineer by bachelor's and a PhD in organic chemistry and so we 18:53 18 minutes, 53 seconds lead from the top especially when there are problems uh we are very very involved we have about 50 projects going 19:00 19 minutes on in R&D today and all of the 50 projects are directly led by myself and in dotted lines by our CTO Jim Ringer uh 19:08 19 minutes, 8 seconds when the projects are scaled up in the pilot plant the pilot plant reports direct uh directly into me production and operations via the corresponding 19:16 19 minutes, 16 seconds leaders report directly into me and we lead from the top end especially when there challenges or upsets. Uh the first one on the ground uh is uh the leaders 19:25 19 minutes, 25 seconds and myself. So we lead from the top is the short answer to your question and I think that spreads a culture of uh 19:32 19 minutes, 32 seconds responsibility and uh undertaking across the company and also we have a culture of uh stop work at all levels uh from 19:42 19 minutes, 42 seconds the ground employees to the topmost leaders any all people are have the 19:50 19 minutes, 50 seconds capability to stop work whenever it's a safety issue and so that uh freedom and liberty is given across the the 19:59 19 minutes, 59 seconds organization and that's the culture we establish and the nature of R&D is such that uh what we tell our leaders is research and 20:08 20 minutes, 8 seconds development there are two results and both are equally good results one is success and one is failure and so you can fail in the experiments or you can 20:15 20 minutes, 15 seconds succeed in the experiments and both of them are are acceptable outcomes and that's like some glimpses of the culture that we have and the other part of that 20:24 20 minutes, 24 seconds answer also is that We try extremely hard not to fail when we scale up and that's why we have what I uh call the 20:31 20 minutes, 31 seconds largest pilot plant in the world. We have more than 200 reactors in the pilot plant. We have the right equipment for the right application. And so when we 20:39 20 minutes, 39 seconds scale up the chemistry, we spend an incredible amount of time into uh developing the processes and the chemistry and the chemical engineering 20:46 20 minutes, 46 seconds behind the scaleups that when we go to full scale, the the the dictim in the company is that we should scale up 20:54 20 minutes, 54 seconds having a cup of tea. Uh which means that the scaleup should go so well that it never fails. So hopefully that answers both parts of your question. Thank you. 21:03 21 minutes, 3 seconds It it does. It does. Very comfortable. 21:05 21 minutes, 5 seconds Very comforting. And thank you for detailing those responses and by the way that 50 projects that we have today should hopefully become 100 and 200 over 21:14 21 minutes, 14 seconds time. So all the very best and I'll rejoin the queue. 21:18 21 minutes, 18 seconds I'll send some kajakat please to your home. Thank you. 21:22 21 minutes, 22 seconds Thank you. The next question comes from the line of Pikshit Gujarati with Nishad. Please go ahead. 21:29 21 minutes, 29 seconds Hello. Thank you for this opportunity sir and congratulations on a very good set of numbers. So my first question was 21:36 21 minutes, 36 seconds on the CM side uh given you uh so I was asking that what will be your strategy 21:43 21 minutes, 43 seconds will you acquire new CM customers over the time or or you will gain the pocket share of the existing customers. 21:52 21 minutes, 52 seconds Yeah, thank you and a good question also. Uh the answer is both. Uh we work extremely hard in curating and 22:01 22 minutes, 1 second establishing these relationships. Our relationships with this innovators is at the topmost levels in the technommercial domains and these relationships are led 22:10 22 minutes, 10 seconds directly by Rohan or myself or Norbert or Jim or Ray Roach which are business development leaders and so he worked very very hard in establishing 22:18 22 minutes, 18 seconds relationships across the leaderships of these companies. the sole purpose being that we are their go-to uh uh partner. 22:28 22 minutes, 28 seconds We are their one-stop solution for research, for scale up, and for commercial supply. And so uh basically, 22:35 22 minutes, 35 seconds not only do we want the current projects that we are doing with Baker Hughes and Milikin, but we want the next 10 uh products in their pipeline and that 22:43 22 minutes, 43 seconds they're urgently required for research scale supply. And so that's number one. 22:48 22 minutes, 48 seconds Number two is of course uh um we are not we are not we are working with you know a lot of innovators across the globe. We 22:55 22 minutes, 55 seconds are not working with all. The goal is to work with all right and so um we are continuously looking for new customers, new contacts, new uh outreaches. We are 23:05 23 minutes, 5 seconds exhibiting in about 10 shows worldwide every year. Uh there's also um references being given by our existing 23:13 23 minutes, 13 seconds customers to their friends in the industry and this has happened across four concrete projects where we have started new relationships simply by 23:21 23 minutes, 21 seconds reference from our existing customers and so going off the new customers is consistent goal and uh the ultimate goal 23:27 23 minutes, 27 seconds being that we want to be able to be in a luxurious position of being able to pick and choose the projects that we work on and the strategic partnerships that we focus on in our business development. 23:39 23 minutes, 39 seconds Okay. Okay. And so my next question was that how much time does it take to convert a customer from CARAMS to CM? 23:48 23 minutes, 48 seconds Um it really depends. So we have examples where this has happened in 6 months and then we have examples where it has taken six years u um to convert 23:58 23 minutes, 58 seconds such customers into the contract exclusive manufacturing business. It simply depends upon their pipeline and the timeline of these pipelines. So you 24:06 24 minutes, 6 seconds if you look at a pharma molecule the pipeline to take something from phase one to commercial is 7 8 years. If you look at oil and gas the the timeline is 24:14 24 minutes, 14 seconds one year right it's and everything in between. So it really depends but on average you could you should consider I think between one to two years. 24:22 24 minutes, 22 seconds Okay. Okay. And so uh and so down the line two three years uh what contribution will be from this segment the total revenue of your business. 24:34 24 minutes, 34 seconds So what we're targeting is uh basically 70% of our revenue uh coming from CRAMS and CM and 30% coming from Ncale manufacturing. 24:45 24 minutes, 45 seconds Okay. Sure. Sure. That's answer my question. Thank you so much. 24:51 24 minutes, 51 seconds Thank you. A reminder to all the participants please restrict yourself to two questions. Next question comes from the line of Manishadani with 361 Capital. Please go ahead. 25:06 25 minutes, 6 seconds Hello. Uh sir as you mentioned in your opening commentary that you're one of the future customer will be from the Europe that is into the material 25:15 25 minutes, 15 seconds science. So is the customer name because they are also into the material science. 25:23 25 minutes, 23 seconds So we do not name our customers. Uh so uh this is confidential but we can tell you that uh it's a m uh it's a customer from Europe in the material science 25:32 25 minutes, 32 seconds sector. We'll not comment anything further than that. Okay we got it. Got it. 25:41 25 minutes, 41 seconds Mr. Badani are you done with your question? Yes sir. I'm done with my question. 25:47 25 minutes, 47 seconds Thank you. Next question comes from the line of Deng with Tiger Assets. Please go ahead. 25:55 25 minutes, 55 seconds Good evening sir. Hope I'm audible. Yes. 26:00 26 minutes Yeah. Uh sir, so in the CM segment, we understand that you cannot disclose the specific products. However, structurally 26:09 26 minutes, 9 seconds there appears to be a significant opportunity in the non-farma non-gro chemistries. So from an industry 26:17 26 minutes, 17 seconds standpoint, how high are the entry barriers for the global chemical players in these products? So specifically, what makes 26:27 26 minutes, 27 seconds customers prefer outsourcing to you rather than backward integrating themselves and uh how protected are 26:35 26 minutes, 35 seconds these businesses from pricing pressure if more players uh enter in the enter in this specific products in the future? 26:47 26 minutes, 47 seconds Yeah, I think um as as you said as I as I said in my commentary that you know in the west it's increasingly impossible to 26:54 26 minutes, 54 seconds manufacture anymore or even scale up anymore and so back integration for these customers is simply out of the question in Europe and America because 27:03 27 minutes, 3 seconds it's just not uh economical for them to do so. uh the pricing has increased significantly across all fronts in the 27:10 27 minutes, 10 seconds west whereas on our case in India uh the pricing is remaining consistent slightly increasing and so there's no way the 27:19 27 minutes, 19 seconds process and product economics of the west can compete with uh Indian uh economics that's number one and number 27:27 27 minutes, 27 seconds two uh especially in the non-farma and non-aggra sector which I believe is what you're commenting on um these companies don't typically shop around too much. 27:37 27 minutes, 37 seconds Once they establish uh strategic partnerships with companies like Ather then we work on transparent costing and 27:44 27 minutes, 44 seconds very transparent relationship very uh forthright communications uh in which case uh both companies create a win-win 27:52 27 minutes, 52 seconds for each other uh in terms of timelines in terms of costing capex opex transparently discussed and in in this 28:00 28 minutes case if we are aligning on um these aspects with these innovators 28:07 28 minutes, 7 seconds There's really no second opinion that they seek or second supplier that they seek and as such there is no pricing 28:14 28 minutes, 14 seconds pressure because these are transparently achieved goals for both companies uh for the customer to achieve what their 28:22 28 minutes, 22 seconds costing is required to be to uh to market and launch these new products and for us companies like Ather to maintain 28:29 28 minutes, 29 seconds where we want our appetite and profit margins to be and that's all transparently discussed and aligned and so in this case there's no pricing pressure, there's no competition. Um, 28:38 28 minutes, 38 seconds and uh, it's a long-term relationship that you establish and a strategic partnership that you establish not for this year, not for two years, for the next 20 years, not for this one or two 28:47 28 minutes, 47 seconds projects, for the next 10 projects in their pipeline. And that's um I think the niche that we have found in this 28:55 28 minutes, 55 seconds non-farma non-ax sector where we are uh the first of its kind u in India going after these sectors and now with this 29:04 29 minutes, 4 seconds relationships so strongly established with these innovators we are well ahead in our partnerships with them and being 29:13 29 minutes, 13 seconds where we want to be as their one-stop solution and as their go-to uh partner for their needs. 29:21 29 minutes, 21 seconds Okay, thank you for the detailed answer, sir. Uh, secondly, sir, could you help us understand the contract renewal cycle 29:28 29 minutes, 28 seconds in your business? So, typically, how often are these contracts renewed and are they done at a fixed prices or 29:37 29 minutes, 37 seconds linked to the spot or raw material prices? 29:42 29 minutes, 42 seconds So uh contracts are usually uh for five year 10 year uh minimum and then it is 29:49 29 minutes, 49 seconds autorenewed uh till the contract is canceled. Uh um the pricings are negotiated every 29:57 29 minutes, 57 seconds year. Uh it is based on open costing sheet platform um which we have derived uh which has all the parameters all the 30:06 30 minutes, 6 seconds overheads which are covered and so every year we sit and hash out uh uh and discuss 30:14 30 minutes, 14 seconds um uh for one day or two day with the customer and then close the contract in uh on win sit basis. 30:24 30 minutes, 24 seconds Okay sir. Thank you. I will join the queue. Thank you. 30:30 30 minutes, 30 seconds Thank you. Next question comes to the line of Kumar Somia, Ambit Capital. Please go ahead. Hi sir. Good evening. Am I audible? 30:40 30 minutes, 40 seconds Yes. 30:41 30 minutes, 41 seconds Hello. Yeah. So first question was on the contract manufacturing business. So if you see the Q1Q the business has gone 30:47 30 minutes, 47 seconds from 131 crores to 135 crores and on front of it your Baker's business is up from about 50 crores to uh sorry about 30:56 30 minutes, 56 seconds 50 cr to 60 cr. So could you please give some more clarity on how the other contracts are panning out right now? Uh where are we on the converge poly and 31:05 31 minutes, 5 seconds how is the base legacy contract business is doing? I will answer to the convers. 31:10 31 minutes, 10 seconds The convers is uh as I spoke earlier in my uh speech the converge polyhol is picking up very well. Uh a lot of new 31:19 31 minutes, 19 seconds customers are uh are sampling this product and testing this product and have all already given certain quantities small quantity orders to us. 31:31 31 minutes, 31 seconds So uh we see this going through very well uh uh uh in financial year 2026 and 31:39 31 minutes, 39 seconds 27. Um um we will be following this up very well. Also, colors polyol can is 31:48 31 minutes, 48 seconds being used to uh to make further more derivatives uh 31:55 31 minutes, 55 seconds on on the on this product side and which we are doing and developing and giving to our customer for qualifications. 32:04 32 minutes, 4 seconds uh as u as far as the cran uh cm business is uh ongoing that there are uh 32:13 32 minutes, 13 seconds uh one product which has a cyclical uh trend. So hence that product uh for the 32:20 32 minutes, 20 seconds quarter had been uh in uh lost less sold but in this quarter it will be turning up good. 32:29 32 minutes, 29 seconds Okay. 32:31 32 minutes, 31 seconds And sir uh secondly on the LSM side so we have seen improvement in the LSM business uh on a sequential basis as well. Uh so what would be the key product that would be driving that? 32:43 32 minutes, 43 seconds Uh we have several key products on this but we would not like to discuss the products but we can discuss it offline 32:51 32 minutes, 51 seconds if you want and you can explain you on the offline basis. 32:54 32 minutes, 54 seconds uh just on an overview how you are seeing the demand in farmer and agro business right now especially in farmer API intermediates that you are in how is 33:02 33 minutes, 2 seconds the demand trend right now overall the volumes are back uh the volumes have increased quarter on 33:09 33 minutes, 9 seconds quarter 10% uh year on year 25% for us so we are seeing uh good demand for our 33:16 33 minutes, 16 seconds products in pharma and agro uh uh and overall also the the demand has 33:24 33 minutes, 24 seconds been good uh because there's lot of uh pricing uh prices has bottom up uh quite 33:32 33 minutes, 32 seconds a um since last two or two or three quarters. So we are seeing the demand coming up properly and we we hope that 33:40 33 minutes, 40 seconds the demand remains robust for all these products for us. Uh that's the that's 33:47 33 minutes, 47 seconds the the expectation from us. Uh when you say 25% year on year volume growth you mean the overall business or just the 33:55 33 minutes, 55 seconds farmer and egg grow only for large scale manufacturer. Okay. Only on large scale management. 34:02 34 minutes, 2 seconds Got it. Uh and lastly sir f mentioned key on the working capital side. So where are we on that? Uh how is the working capital right now? You mentioned something on inventory side. 34:12 34 minutes, 12 seconds Yeah. So uh we are we are still uh able to manage the working capital and uh it was 149 150 days on 31st March which is 34:21 34 minutes, 21 seconds sorry on 30th September uh and which is approximately 160 days only just because we have proate inventories raw materials for the site 3+ coming up and also site 34:30 34 minutes, 30 seconds five. So we have built up some inventories because the production starts from March onwards otherwise everything is in control which was there 34:37 34 minutes, 37 seconds in September 30th. Got good. And then lastly on this other segment uh we have seen material improvement Q from about 34:45 34 minutes, 45 seconds 10 crores to 25 26 crores. If you could give some clarity as in what is the driving Q improvement in that segment. 34:54 34 minutes, 54 seconds No see uh this is one time because you know uh our auditors have asked us to put the FLOP claim which is issued in 35:02 35 minutes, 2 seconds this uh other section which is approximately 15 crores. Otherwise there is no other business which is there in that it it will always remain at 1 or 2% 35:11 35 minutes, 11 seconds uh not more than that. So FLB clone which we said it's the asked us to classify in revenue from other operations. So it is it is parked in the 35:19 35 minutes, 19 seconds others currently and fo lastly on the margin side will it be fair to assume that our sustainable 35:26 35 minutes, 26 seconds IEDA margin guide uh run rate would be roughly 34 35%. 35:31 35 minutes, 31 seconds No, it will we we would like to still be conservative and we'll always be around would be right to be around 29 to 30 35:39 35 minutes, 39 seconds days not more than that the as I told you there's a certain one time this FLOP claim has come up that has also increased margins a bit because it's put 35:48 35 minutes, 48 seconds up in the other revenues otherwise we'll be around 20 and 30ish good good yeah as last in terms of KPX 35:57 35 minutes, 57 seconds how much we have done so far in the 9 month in the 9 ments we have fractionally done CW the CWFP which stands for site 3 plus 36:05 36 minutes, 5 seconds and panoli the site five approximately 500 crores. 36:10 36 minutes, 10 seconds Okay. And how much are we targeting to close this year? This year it will be select the site both the sites will 36:17 36 minutes, 17 seconds phase two of uh sorry two two blocks of the phase one will be ready for panoli which will be capitalized and there will be still uh approximately 200 crores in 36:26 36 minutes, 26 seconds the CWIP and uh site 3+ plus also will be capitalized which will be approximately 250 or 260 crores odd. 36:34 36 minutes, 34 seconds So roughly 550 to 600 cr we should see as an cash flow item in terms of uh kx for the full year. 36:42 36 minutes, 42 seconds Yeah. Yeah. Full years. No, full year rate will be approximately 500 crores. 400 to 50. 450 to 500 crores. Okay. 36:50 36 minutes, 50 seconds Yeah. Good. Thank you. Thank you. 36:56 36 minutes, 56 seconds Thank you. Next question comes from the line of Nitan Akarwal with Dan Capital. Please go ahead. 37:02 37 minutes, 2 seconds Thanks for taking my question. Uh on you know there has been a significant uh increase in R&D expenses over the years 37:09 37 minutes, 9 seconds and particularly for 9 months. So if you can please help us understand are there any is there any specific areas where we ramp particularly ramping up our R&D 37:17 37 minutes, 17 seconds strength uh ammon will add more on on on this uh 37:25 37 minutes, 25 seconds but uh we are specifically u targeting non-farmmer non-aggro uh sectors uh 37:32 37 minutes, 32 seconds there are a lot of inbound inquiries coming from material science uh uh segment uh oil and gas segment which we 37:39 37 minutes, 39 seconds are addressing at the moment in the R&D and so the R&D expenses uh and R&D 37:46 37 minutes, 46 seconds investments are quite high. Um yeah, so we're doing short-term expansions in R&D as well as I mentioned in my speech uh 37:54 37 minutes, 54 seconds with uh 20 ft woods. We are installing a nuclear magnetic resonance spectroscopy equipment which is significantly 38:01 38 minutes, 1 second expensive analytical tool for advanced organic synthesis and so we are looking at expanding R&D quantitatively and 38:10 38 minutes, 10 seconds qualitatively and uh there's a cost to that. Thank you. 38:16 38 minutes, 16 seconds And second on you know we talked about some of you some potentially some large scale contracts getting signed up on the on the contract contract manufacturing 38:24 38 minutes, 24 seconds side but from infra manufacturing infrastructure perspective what does it mean does it mean that we need to accelerate some more rollouts in a site 38:31 38 minutes, 31 seconds five or there is enough capacity in the network current network to take on some of those contracts that you already sign up there 38:39 38 minutes, 39 seconds there is enough capacity in the current pipeline to fill up the assets as we are building them. So we are quite optimistic of our pipeline and the 38:46 38 minutes, 46 seconds ability to fill up the vessels and the plants as they come online. 38:50 38 minutes, 50 seconds Also we are monitoring um the inbound inquiries and that being converted into commercialization. So if there is a 38:59 38 minutes, 59 seconds requirement or a need to fast track the expansions we would be able to do that also. 39:09 39 minutes, 9 seconds Thank you Mr. Awell. Please rejoin the queue for more questions. Next question comes from the line of vignay with sequent investments. Please go ahead. Uh 39:18 39 minutes, 18 seconds so conversation on uh strong set of numbers. So my only question uh is on uh the utilization that we are targeting 39:27 39 minutes, 27 seconds for site 3+ and site five for fi27. Uh if you can share uh uh the same. 39:36 39 minutes, 36 seconds So see side 3++ which starts from the month of March uh for the next year it will be the first year we we anticipate 39:43 39 minutes, 43 seconds it to be approximately around 45 to 50% caps utilizations and site five will be just two blocks we are starting uh and 39:51 39 minutes, 51 seconds we expect that to be around 35 to 40% cap residence in the next year okay and the capex that you have done on 39:58 39 minutes, 58 seconds 53 plus it would be approximately 260 crores thank Thank you. Mr. Ayel, please rejoin the queue for more questions. 40:09 40 minutes, 9 seconds Next question comes on the line of Pavika Jen with Mata Capitals. Please go ahead. Hello. Am I audible? Yes. 40:18 40 minutes, 18 seconds Yeah. Uh thank you for the opportunity. 40:20 40 minutes, 20 seconds Uh so basically I have a question regarding uh one of your announcement related to a lithium batteries chemical 40:27 40 minutes, 27 seconds for some global player. So I just want to know like if you can share some uh light on the capacity and the ramp up timeline when it's expected to go live. 40:38 40 minutes, 38 seconds Mhave we are not into the electrolyte business so I do not know where you got this information from. 40:44 40 minutes, 44 seconds Uh sorry lithium uh batteries like chemical specialized chemicals for lithium batteries something like that. 40:51 40 minutes, 51 seconds We are not manufacturing lithium batteries or additives uh as of now. 40:56 40 minutes, 56 seconds Okay. And uh the second question is regarding that uh because you have a lot of CM contracts. So I just want to know 41:03 41 minutes, 3 seconds that apart from Baker and Milikin uh how many number of contracts you have right now or like uh in in your portfolio and 41:11 41 minutes, 11 seconds uh in terms of client like how many clients are on board uh with Ather right now? 41:22 41 minutes, 22 seconds Approximately seven seven customers are onboarded for the CM business. 41:29 41 minutes, 29 seconds Thank you, Miss Shen. Please rejoin the queue for more questions. 41:33 41 minutes, 33 seconds Next question comes from the line of Saita with Family Fund. Please go ahead. Uh yeah, am I audible? Hello. 41:42 41 minutes, 42 seconds Yeah. Yeah. Yeah. Please go ahead. 41:43 41 minutes, 43 seconds Uh yeah, thanks for providing this opportunity and uh I congratulate on a great set of numbers and my question is on the converge polyol. So currently you 41:52 41 minutes, 52 seconds have around 2,000 tons peranom capacity, right? So when you see global market demand, it's around 850 tons peranom. 42:01 42 minutes, 1 second Correct me if I'm wrong. So how do you see two to three years down the line? 42:06 42 minutes, 6 seconds What kind of market share you are going to capture out of this large pile? Can you please give us some number like what's your thoughts on that? You could current capacity is 500 tons only. 42:18 42 minutes, 18 seconds uh once we reach 500 tons we will take a 2ka plant that is 2,000 tons and we are 42:26 42 minutes, 26 seconds uh we are slightly behind target uh but speaker sorry for uh interrupting your voice is baking can you come a little 42:34 42 minutes, 34 seconds closer to the mic and speak sure uh thank you so as as I've said earlier u 2026 financial year and 2027 42:45 42 minutes, 45 seconds is seeing a good u demand on this product. So we will cover this uh gap 42:51 42 minutes, 51 seconds soon enough uh and then once we trigger a 2ka plant 42:58 42 minutes, 58 seconds uh we will let you know uh the demand uh or the addressable market on case industry is 850 kta and not metric ton. 43:09 43 minutes, 9 seconds uh that that is what the addressible demand is and we will be only um taking care of a 2 KTA plant to start with and then see how it goes from there. 43:22 43 minutes, 22 seconds So you are expecting it increase after 2 KTA right? Yeah. 43:26 43 minutes, 26 seconds Yes. So like how much percentage of you want to capture it like from 850 KTA. So for 3 years down the line like what's 43:34 43 minutes, 34 seconds your uh thought on capturing market uh 3 years down the line we would be 43:41 43 minutes, 41 seconds doing 2 KTA approximately uh that's our target initial target and once we achieve that we will be discussing 43:49 43 minutes, 49 seconds uh with the principle and see how we can take it forward and expand this capacity forward. Okay, thanks. And one more 43:57 43 minutes, 57 seconds question, last question. So, uh in your previous call, you just mentioned out of some uh uh projects that are in under 44:04 44 minutes, 4 seconds R&D, you are expecting around three to four molecules of a size of mill. Are you sticking with that? Uh or else are 44:12 44 minutes, 12 seconds you seeing any traction coming forward like further more molecules coming out of that scale? 44:20 44 minutes, 20 seconds Yes, sticking with that. And there's uh and what is the timeline like what you're expecting that kind of three to four molecules in the next year or some 44:29 44 minutes, 29 seconds in the next between 1 to 3 years all of these should be panning out into significant contracts. 44:36 44 minutes, 36 seconds Okay. Okay. Thanks. Thanks. Thanks a lot. Yeah. 44:40 44 minutes, 40 seconds Thank you. Next question comes from the line of Bavika Jen with Meta Capitals. Please go ahead. 44:46 44 minutes, 46 seconds Uh thank you for followup question. So basically uh like in your Q3 presentation of FI24 44:54 44 minutes, 54 seconds uh it's mentioned that uh there is an announcement partnership with a major global lithium ion battery producer. So 45:00 45 minutes I was asking regarding that uh yeah there was one there electrolyte 45:06 45 minutes, 6 seconds additives uh where we have we had uh developed these for the first time in India and we had we had tied up with a 45:14 45 minutes, 14 seconds global partner for that. uh after this time uh last year the pricing in China 45:22 45 minutes, 22 seconds became extremely aggressive and tanked to almost half of what it was and so at that time it was not economically viable 45:30 45 minutes, 30 seconds for us and so we had put the entire uh project and the entire field on hold on pause. These stand developed these 10 45:38 45 minutes, 38 seconds scaled up these 10 ready to be launched into manufacturing. We are continuously having discussions with this particular customer and other customers in this 45:45 45 minutes, 45 seconds area. But till as and when uh the global pricing position doesn't improve to the from the absurd levels that they are 45:54 45 minutes, 54 seconds today, we are going to put this on pause for the moment. So you're right uh this was this announcement and uh that is the current status. 46:03 46 minutes, 3 seconds Got it. Thank you. And the other question I have regarding your Baker facilities. So as per my understanding you are currently manufacturing eight 46:10 46 minutes, 10 seconds products for the baker. So just want to understand from uh long-term point of view like how you are going to maintain this relation like uh are you planning 46:19 46 minutes, 19 seconds to d like uh onboard more uh products for the company or because the oil field 46:25 46 minutes, 25 seconds uh like as a application industry it's a quite volatile so I just want to understand the management view on the baker facility like uh what's the view 46:34 46 minutes, 34 seconds of the management? We are positioning ourselves as a strategic partner uh to the customer uh with a low cost uh 46:43 46 minutes, 43 seconds aggressive economically costing uh from the Indian manufacturing perspective uh going after the entire portfolio of 46:51 46 minutes, 51 seconds chemicals business in the oil and gas and the oil field services and Baker is one of the biggest uh uh companies in 46:59 46 minutes, 59 seconds this market and so the potential across the number of products as well as the volume of each product is significant 47:08 47 minutes, 8 seconds and that is the focus is to be a strategic partner across a basket of products for the next decades to come 47:15 47 minutes, 15 seconds and so that's that's our position in with respect to Baker Hughes and our other strategic partners. 47:22 47 minutes, 22 seconds Okay. And just last question is regarding our margin size like because you have a three business model. So if you can uh share if it's possible like 47:31 47 minutes, 31 seconds the margin breakup like approach can be expected from which business segment. 47:37 47 minutes, 37 seconds Uh sure Babra. So the cra side of the business model has margins ranging between 60 to 65% at the bida level. uh 47:46 47 minutes, 46 seconds at the CM it is between 27 to 30 and for LSM it is between 21 to 23% AITA margins. 47:55 47 minutes, 55 seconds Okay, thank you so much. 47:59 47 minutes, 59 seconds Thank you. Next question comes from the line of Ankur with Old Rice Invest. 48:03 48 minutes, 3 seconds Please go ahead Mr. Ankur. Please go ahead with the question. 48:12 48 minutes, 12 seconds Hi. Hi. Thank you for the opportunity. 48:14 48 minutes, 14 seconds Uh I had one question to the management is regarding the working capital. So if you see it's it's a very heavy working capital business. So is it inherent with 48:22 48 minutes, 22 seconds the business model or is there any other solution which we are looking going forward with the scale? What are the views of the management on the scene? 48:30 48 minutes, 30 seconds Yeah. So see the the LSM business which we are doing is we are directly competing with China and China is offering very aggressive uh payment 48:38 48 minutes, 38 seconds terms to customers which range from 180 to 250 days uh with LC terms also. uh that's why we are more more not you 48:46 48 minutes, 46 seconds cannot say more but we are trying to focus more on towards CM wherein the payment terms are very much uh shorter 48:53 48 minutes, 53 seconds than what we have in LSM and also the inventory flushing is quite faster in the LSM in the CAM business than LSM. So strategically we are trying to increase 49:01 49 minutes, 1 second more on the CAM business and the crimes business. Thank you. 49:11 49 minutes, 11 seconds Thank you. Next question comes on the line of Amay Sharda with Omar Investment Advisors. Please go ahead. 49:20 49 minutes, 20 seconds Uh, hi sir, thank you for the opportunity. I just had two questions. One was regarding the LSN business. Do you do we 49:26 49 minutes, 26 seconds see any kind of a increase in the prices of the chemicals now due to the anti-inulation trend in China? 49:35 49 minutes, 35 seconds Um, not at the moment we are not seeing that. uh I believe so that after the after their uh annual holidays which is 49:43 49 minutes, 43 seconds happening uh in the next 2 weeks uh we will see some traction or some uh policy change from them. So we have to wait for 49:52 49 minutes, 52 seconds 2 3 weeks to understand how China will react on the pricing. 49:58 49 minutes, 58 seconds Okay, got it sir. And can you give me the 9 months uh CFO number for the 9 months cash from operations? 50:10 50 minutes, 10 seconds No, we we have we do not present cash from operations in the 9 months. It is only 6 months which is there. So we have not presented that. 50:20 50 minutes, 20 seconds Okay. Sure. Thank you sir. 50:25 50 minutes, 25 seconds Thank you. Next question comes online of Atish Malhan with Abacus mutual funds. Please go ahead. 50:33 50 minutes, 33 seconds Uh hi, good evening and congratulations on a good set of numbers. Um two questions from my side. Um firstly uh on the semiconductor chemicals that you 50:42 50 minutes, 42 seconds mentioned now I appreciate you cannot dwell del into the um uh the specifics but is this for a photoresist chemical? 50:54 50 minutes, 54 seconds Uh so uh let me uh tell you that the there are three applications for this uh 51:01 51 minutes, 1 second product. It's a low dialectric resin and substrate substrate for highspeed PCBs in advanced electronics. 51:10 51 minutes, 10 seconds Uh also it has application in celain coupling agents for uh electronic grade glass fibers and high performance 51:17 51 minutes, 17 seconds composites. And lastly, it has also applications in speciality polymers including ion exchange regions, photo 51:25 51 minutes, 25 seconds resist and rubber resins, modifiers for industrial and electronic applications. 51:30 51 minutes, 30 seconds Uh that's what I can till now. I mean uh once we formalize this announcement, we will let you know more about this product. 51:40 51 minutes, 40 seconds No, no, fair enough. That was more than what I was expecting. So thank you. Um the second question is on the milit 51:47 51 minutes, 47 seconds contract. Um so are we on track to commercialize from Q1 FY27? Yes, absolutely. 51:57 51 minutes, 57 seconds Okay. So the commercialization will start from FY27 onwards, right? Yes. 52:04 52 minutes, 4 seconds Okay. Great. Thank you and good luck for the forthcoming quarters. Thank you. 52:10 52 minutes, 10 seconds Thank you. Next question comes to the line of Chintan Sha with JM Financial Family Office. Please go ahead. 52:17 52 minutes, 17 seconds Hi. uh thank you so much for the opportunity. So I just had one question and this is regarding uh to better understand the funibility of our 52:24 52 minutes, 24 seconds manufacturing plans. So I understand we have good long-term contracts with our customers especially for C and admit uh C and segment but just in case I mean 52:34 52 minutes, 34 seconds something doesn't work or if the content doesn't work out. So just want to understand can we repurpose those plans to use it say SM and how quickly we do 52:41 52 minutes, 41 seconds that or we would have to probably find some another customer for those sort of products. 52:48 52 minutes, 48 seconds Yeah, thank you. So uh we have um the focus from day one in the manufacturing has been to build funible plants and 52:56 52 minutes, 56 seconds multiple multi-purpose plants across individual core competencies are uh so-called 8 by8 metrics and so when we build plants then we build them so that 53:05 53 minutes, 5 seconds they are multi-purpose and funible across these core competencies and and we focus on these core competencies and so in our R&D in the 50 projects that we have say for 53:14 53 minutes, 14 seconds example most of them are focusing on these core competencies and so in case things don't work out if contracts change if force mayors are invol are 53:23 53 minutes, 23 seconds incurred if um if directions change for the customers or the products or China pressure comes in uh we always uh go 53:31 53 minutes, 31 seconds back to the pipeline and then introduce products uh in these funible plans across those core competencies. 53:39 53 minutes, 39 seconds Thank you. Okay. 53:44 53 minutes, 44 seconds Thank you. Next question comes from the line of Nosha Ji with Adit Ba. Please go ahead. 53:50 53 minutes, 50 seconds Yeah. Hi. Uh thank you uh for the opportunity and congrats on a decent set of number. Um few clarifications sir. Um 53:59 53 minutes, 59 seconds starting with uh gross margin. Uh just wanted to check if there is any benefit uh of the raw material prices softness 54:08 54 minutes, 8 seconds especially phenol or other materials. Um is there any component of that benefit also in the gross margin? Thank you guys 54:16 54 minutes, 16 seconds for audible. 54:24 54 minutes, 24 seconds Yes. 54:27 54 minutes, 27 seconds The first one you wanted to understand if there is any benefit of raw material is softness. 54:33 54 minutes, 33 seconds No currently no benefit at all because I remember in the uh down cycle um we had this issue of phenol on our 54:43 54 minutes, 43 seconds gross margin when uh the prices of this product phenol were spiking that was impacting our gross margin. was 54:51 54 minutes, 51 seconds wondering uh if the cycle is down for phenol should have some benefit. Um 54:58 54 minutes, 58 seconds anyway, second on the on the um on the overall staff cost if I compare your staff cost as a percentage of revenue 55:06 55 minutes, 6 seconds versus uh many other domestic guys uh which are into you know similar kind of 55:12 55 minutes, 12 seconds uh business. your staff cost seems uh uh very very efficient uh versus other guys uh as a percentage of revenue revenue. 55:22 55 minutes, 22 seconds So uh and despite we being heavy in terms of contact manufacturing and cramps. So how do we you know explain 55:29 55 minutes, 29 seconds this kind of efficiency uh in terms of staff overall staff productivity? 55:36 55 minutes, 36 seconds Um a great good question. Um yes so we um uh is as as I mentioned earlier in one of the answers questions uh talent 55:45 55 minutes, 45 seconds recruitment and talent retention is a key focus for the company and uh we are very very careful in our recruitment uh 55:53 55 minutes, 53 seconds strategy across all levels which keeps this number in check and also uh uh what I answered in the last question as well 56:01 56 minutes, 1 second was that we lead from the top as well and so the core team that we have in the in the promoter family and then in the top leadership's leadership circles. uh 56:09 56 minutes, 9 seconds they all wear multiple hats uh and lead multiple portfolios and multiple domains which uh uh keeps the organizational 56:18 56 minutes, 18 seconds structure and the hierarchy quite flat uh which keeps the number in check as well and so uh great observation it's a correct observation and uh it's a 56:27 56 minutes, 27 seconds conscious strategy of the company to enable that and what would be the average age of the 56:33 56 minutes, 33 seconds overall staff especially which are uh in the R&D so in the R&D The average staff will age 56:41 56 minutes, 41 seconds will be around 30. Uh the average uh staff age and across the company will be 32 33. The average leadership average uh 56:49 56 minutes, 49 seconds age will be around 40 45. And that gives you an idea. 56:53 56 minutes, 53 seconds And um last on the uh Baker and Milikin are we only supplier in these two two products? 57:02 57 minutes, 2 seconds We are one of the we are the only supplier. Yes. 57:06 57 minutes, 6 seconds And it's curious to know uh you know from a client point of view what made them to you know keep uh keep you only 57:13 57 minutes, 13 seconds for the supplier to supply this product why they would they should not you know think of u mitigating u the risk in terms of their concentration. 57:24 57 minutes, 24 seconds Um multiple answers to that question but it's a strategic partnership that is enabled. uh they are also uh very keen 57:30 57 minutes, 30 seconds to have only uh single suppliers or um because of the intellectual property protection the confidentiality 57:39 57 minutes, 39 seconds protection as well. They are innovators who want to protect their technology and not have it uh be in the hands of 57:46 57 minutes, 46 seconds multiple people. Also it's the confidence that we provide these customers and innovators and the relationship that we have and the 57:53 57 minutes, 53 seconds executional innovation capabilities that we have which lets them uh gives them enough confidence that uh having only partners 58:02 58 minutes, 2 seconds will suffice and also we give uh redundant geographically separate manufacturing sites for these 58:10 58 minutes, 10 seconds customers and their products. And so for example we have multiple sites sites 2 3 4 five for manufacturing and we can usually because we have funible 58:18 58 minutes, 18 seconds manufacturing plants across our core competencies we can usually uh provide the supply from multiple sites which also gives them resiliency of their 58:27 58 minutes, 27 seconds supply in case of an event in one particular site. So multiple answers to that question hopefully that gives you a flavor. 58:34 58 minutes, 34 seconds Uh sure sure thank you so much all the thank you. Next question comes from the 58:41 58 minutes, 41 seconds line of Deep Sangui with Dalal and Roaja Stock Broking Private Limited. Please go ahead. Um, hello. Am I audible? 58:50 58 minutes, 50 seconds Yes. Yeah, please go ahead. 58:52 58 minutes, 52 seconds Yeah. So, thank you so much for the opportunity and congratulations on a great set of numbers. So, my first question was was on CRAMS. So, for CRAS 59:01 59 minutes, 1 second research, do the clients give the money in advance or uh like do we first invest and then we get the money? 59:09 59 minutes, 9 seconds Combination of both. on strategic long-term projects. Uh we are happy to invest as well but at the typical uh 59:16 59 minutes, 16 seconds strategies uh um customer pays for everything in advance and as the work goes along. 59:23 59 minutes, 23 seconds Okay. Okay. Thank you. And my second question um is like the what is the expected revenue coming from Baker going forward? 59:36 59 minutes, 36 seconds deep will not be able to answer any forwardlooking statements especially for specific CM clients but what we can tell 59:43 59 minutes, 43 seconds you is that the trend looks good it's uh trending upwards uh the growth has been 20% quarteron quarter uh for this 59:51 59 minutes, 51 seconds quarter for third quarter and we see an increasing trend um as we try to continue to service baker users in different sites and expand our products 1:00:00 1 hour uh which we can offer baker got it uh just uh a followup like is there any other future guidance that you 1:00:08 1 hour, 8 seconds could give or No, we usually refrain from giving guidances uh for future. 1:00:14 1 hour, 14 seconds Sure. Sure. No problem. Just thank you so much for the opportunity. Yeah. 1:00:21 1 hour, 21 seconds Thank you. Next question comes from the line of Lakshia an individual investor. Please go ahead. 1:00:28 1 hour, 28 seconds Hello. Hi. Uh thanks for taking my question also an amazing set of numbers. 1:00:33 1 hour, 33 seconds Uh so my first question is that uh so for Baker's contract we had like eight products in the pipeline of which two products are giving us like the current 1:00:41 1 hour, 41 seconds quarter run rate of 60 kores from site four site four itself. So where are we with the remaining products and uh what would be the potential market size for 1:00:50 1 hour, 50 seconds the same uh Mr. Lakshia I think so there is some mis misunderstanding at your end. I we are currently doing eight products and 1:00:59 1 hour, 59 seconds there are other 7 to8 products in pipeline. So this 60 crores revenue which has come in is come up from this eight products and other products are in 1:01:06 1 hour, 1 minute, 6 seconds pipeline wherein the research is going on and the scale up is being being doing being done sorry. 1:01:14 1 hour, 1 minute, 14 seconds Okay, understood. And uh so the pipeline which you mentioned of the 78 products. 1:01:18 1 hour, 1 minute, 18 seconds So uh what would be the potential market size for the same? 1:01:25 1 hour, 1 minute, 25 seconds I think I we probably should not comment on uh the potential market size of the pipeline molecules at this stage at least. 1:01:34 1 hour, 1 minute, 34 seconds Okay, understood. Uh so yeah, that would be my question. Thank you. Thank you. 1:01:43 1 hour, 1 minute, 43 seconds Thank you ladies and gentlemen. That was the last question for today. We have reached the end of question and answer session. I would now like to hand the 1:01:51 1 hour, 1 minute, 51 seconds conference over to the management for closing comments. 1:01:55 1 hour, 1 minute, 55 seconds Uh thank you everyone for participating on the call. We hope that we have addressed majority of your questions. If you still have any further questions, 1:02:02 1 hour, 2 minutes, 2 seconds please feel free to reach out to us. Uh stay safe and have a great day. Thank you. 1:02:09 1 hour, 2 minutes, 9 seconds Thank you on behalf of SDFC Securities Limited. That concludes this conference. 1:02:13 1 hour, 2 minutes, 13 seconds Thank you for joining us. You may now disconnect your line.