Arham Technologies Ltd — Q4 FY26

Arham Technologies Ltd Q4 FY2025-26 Earnings Conference Call https://www.youtube.com/watch?v=N5wnyO7wxIw Published: 3 weeks ago

0:00 Yeah, good evening participants. Welcome to the H2 and FI26 earnings call of Aram Technologies Limited. Joining us today 0:07 7 seconds on the call is Mr. Anka Jane, CFO and executive director and Mr. Anan Jin, CEO and executive director of the company. 0:15 15 seconds Before we begin with the opening remarks, a few quick announcements for the attendees. Certain statements made in the course of this call may relate to 0:23 23 seconds future performance or expectations and should be understood as forward-looking in nature. These involve risks and 0:30 30 seconds uncertainties are not guarantees of future performance and actual results may differ from those statements. Over to Mr. Anit for the opening remarks. 0:47 47 seconds Good evening everyone. 0:49 49 seconds On behalf of entire Arum Technologies family, we are delighted to welcome you to our earnings calls for the second 0:56 56 seconds half and full financial year ended 31st March 2026. 1:02 1 minute, 2 seconds FY26 has been a landmark year for ARM Technologies. We have demonstrated that our strategy grounded in integrated 1:10 1 minute, 10 seconds manufacturing premium mass market brand building disciplined capital deployment is delivering measurable repeatable results. 1:20 1 minute, 20 seconds When Arham Technologies began its journey in Raipur in 2013, we were a regional assembler. Today we 1:29 1 minute, 29 seconds are a public listed entity, integrated manufacturer with our own consumer brand, a celebrity brand ambassador and 1:38 1 minute, 38 seconds a presence of 500 plus dealers outlets and a Google certified institutional product line. 1:45 1 minute, 45 seconds Let me begin with what I believe are our four defining achievements of the year. 1:51 1 minute, 51 seconds First on revenue and profitability on a consolidated basis we delivered revenue 1:57 1 minute, 57 seconds from operations of 115 118.5 crores for FY26 representing a growth of approximately 2:05 2 minutes, 5 seconds 70% on year-on-year basis. Our PAT for the year stood at 12.2 crores up nearly 2:14 2 minutes, 14 seconds 68% from 7.2 crores last year. 2:19 2 minutes, 19 seconds Second on brand elevation, we appointed Vicki Koshell as our brand ambassador for Starshine, our flagship consumer 2:27 2 minutes, 27 seconds brand. His reach across urban and rural India resonates perfectly with our go-to market focus on tier 2 tier three 2:34 2 minutes, 34 seconds markets. This is a deliberate forward-looking investment and we are already seeing early tractions in brand recall and retail pool. 2:44 2 minutes, 44 seconds Third on the capacity and backward integration, we successfully raised 53.5 crores through a preferential aotment 2:52 2 minutes, 52 seconds and we have put those funds to work. We have acquired 6350 square meters of land 2:59 2 minutes, 59 seconds at EMC Napur at a subsidized cost of 52.39 lakhs against a market value of 3:05 3 minutes, 5 seconds 4.31 crores. So th this gives us a significant structural cost advantage for our upcoming backward integration 3:13 3 minutes, 13 seconds into molding, sheet metals, motors and packaging. All of which will materially improve our margin profile over the 3:21 3 minutes, 21 seconds coming years. [clears throat] Fourth of the technology leadership, we secured a Google ETL certification with 3:27 3 minutes, 27 seconds Android token for our IFPD displays, opening a reliable new door in 3:34 3 minutes, 34 seconds enterprise institution, smart classroom markets. So this positions starshine not just as a consumer brand but as a 3:43 3 minutes, 43 seconds credible B2B solution provider. And as we enter FI27, we do so from our 3:50 3 minutes, 50 seconds position of general strength and stronger balance sheet, a larger manufacturing footprint, a wider product portfolio and a network of over 500 3:58 3 minutes, 58 seconds dealers and distribution partners across India based on the strong demand visibility. 4:06 4 minutes, 6 seconds This reflects our confidence in sustained growth trajectory of India's consumer electronic market and our 4:12 4 minutes, 12 seconds strength positioning within. I will now hand back to the moderator to open for the Q&A session. 4:20 4 minutes, 20 seconds Thank you sir. Dear participants, we will now be starting with the Q&A section of the call. If you wish to ask a question, please use the raise hand 4:28 4 minutes, 28 seconds feature available on your Zoom dashboard. We will announce your name on the call post which you can proceed with your question. We will wait for a minute 4:35 4 minutes, 35 seconds while the question Q assembles. Kindly introduce your name and the firm you represent before asking your question. Thank you. 4:52 4 minutes, 52 seconds We will take a first question from the line of Dhar Panda. Please go ahead. Am I audible? 5:01 5 minutes, 1 second Yes, you're sir. 5:03 5 minutes, 3 seconds Good evening sir. Uh congratulation on good set of numbers. I had few questions. 5:09 5 minutes, 9 seconds So first of all uh what what specifically led to the margin compression despite the strong topline growth this quarter? 5:21 5 minutes, 21 seconds Look actually you know this uh uh war situation and global uh you know uh volatility actually you know gave us the 5:28 5 minutes, 28 seconds advantage in the first quarter uh because we had uh inventory at a lower cost in the first quarter. So that's why 5:35 5 minutes, 35 seconds you know we got a good uh profitability in first quarter a good margins in the first uh first half of the year which uh 5:44 5 minutes, 44 seconds uh started to rationalize uh over the period of time uh when the year was ending and we had the margin power but 5:52 5 minutes, 52 seconds we wanted to expand and we passed on some good margins to our uh to acquire some more dealers and distributors in 5:59 5 minutes, 59 seconds the market which uh was a strategic move which helped us uh expand and increase our market penetration in the 6:06 6 minutes, 6 seconds region and we also added some number of uh dealers and distributors in our portfolio. 6:15 6 minutes, 15 seconds Okay. And Okay. Understood. And what are what is the fixed assets that we have added from the last result as it was around 14 to 15 crores approximately. 6:24 6 minutes, 24 seconds Yeah. So it is mostly you know the IFPD units what we were uh uh deploying the funds uh last year. It is a working 6:33 6 minutes, 33 seconds capital in progress right now. So we are in final trials of uh our planting machinery which has been installed and 6:40 6 minutes, 40 seconds will be operational uh in a week two to three weeks time. 6:48 6 minutes, 48 seconds Okay. And one more thing uh how much money from the fund raise have been deployed? 6:56 6 minutes, 56 seconds almost uh half of it has been deployed uh 50% of close to 26 27 crores have been deployed remaining uh will be 7:03 7 minutes, 3 seconds deployed in this uh financial [clears throat] year and since we have Vicki Koshel with us on board for the promotions what are the 7:12 7 minutes, 12 seconds market markets we anticipate to enter the post appointment of Vikosh so markets what we are targeting is 7:21 7 minutes, 21 seconds Gujarat right now uh we are not present in Gujarat so we target Gujarat market, Rajasthan, uh, Jakhand, we are present 7:29 7 minutes, 29 seconds in some regions. So, we would like to expand to Jakand uh as well as Bihar market and you know the North India 7:36 7 minutes, 36 seconds region, we would like to in the center and north India region would like to expand to uh all the states which are present right now then we will plan for South India. 7:48 7 minutes, 48 seconds Okay. And sir also your can you share your views on trade receivables? 7:53 7 minutes, 53 seconds Yeah, because you know we uh January to May June is you know uh vic season and peak demand season for consumer 8:01 8 minutes, 1 second electronics. So basically you know due to expansion and all you know majority of our sales were happened uh later part 8:09 8 minutes, 9 seconds of February and March. So that's why uh receivables uh look high on March numbers but uh the receivables have been 8:17 8 minutes, 17 seconds decreasing post that and uh it will be even out soon. 8:24 8 minutes, 24 seconds Okay. And when will when will this convert into uh revenue? Pardon? 8:31 8 minutes, 31 seconds When will this receivables will be converted into revenues? 8:36 8 minutes, 36 seconds No, revenue uh booking is uh receivables are after revenue. receive uh payment 8:42 8 minutes, 42 seconds receipt uh is already under process and after March majority of chunk of our receivables have been already received 8:50 8 minutes, 50 seconds and it is uh on a standard due course right now. 8:55 8 minutes, 55 seconds Okay. And one last question what are the what are your guidance for FY27? 9:00 9 minutes FY27 you know um we are targeting a group you know cross revenue of 200 cr. 9:10 9 minutes, 10 seconds Okay. Thank you very much. Thank you. 9:14 9 minutes, 14 seconds You we will take our next question from the line of Mr. Ashish Sony. Please go ahead. 9:21 9 minutes, 21 seconds Yeah sir. Uh you're planning to raise almost 80 odd kores. So is the fundraising done or is there something more to be done still? 9:31 9 minutes, 31 seconds Uh as of now fundraising has been completed. uh 53 something uh crores have been raised through the 9:39 9 minutes, 39 seconds preferential funders round and uh approximately 12 crores of warrants are uh under process wherein the initial 9:46 9 minutes, 46 seconds money has been paid up and we have approximately you know one year to fulfill that warrant commitments. 9:53 9 minutes, 53 seconds So all fundraising is complete except the warrants for yes all fundraising is complete and you said uh initial remarks uh there 10:01 10 minutes, 1 second is some traction you are seeing based on the brand ambassador you have selected. 10:06 10 minutes, 6 seconds So can you some throw some more light on that? 10:09 10 minutes, 9 seconds Yes because you know once the announcement uh we made on the brand endorsement side. So you know we got few 10:16 10 minutes, 16 seconds calls for uh distribution uh in our exist existing territories where where our presence was not much as high as uh 10:25 10 minutes, 25 seconds it was earlier. So you know we started to get some new leads and all. So we are seeing the positive response uh of onboarding to sell. 10:35 10 minutes, 35 seconds And how are you handling the raw material volatility and in terms of pricing or uh internal how are you managing that going forward? 10:46 10 minutes, 46 seconds Uh your voice was little distorted. Can you please repeat the question? 10:50 10 minutes, 50 seconds Yeah raw material volatility I think it compress your margin in X2 right. So how are you planning to handle that going forward and any plan for the price increase for your products? 11:00 11 minutes Uh yeah we will pass pass pass it on to our consumers you know uh it it is a natural process wherein you know we had 11:06 11 minutes, 6 seconds inventory of the lower cost and prices started to increase. So we got a good profit margins uh because you know 11:14 11 minutes, 14 seconds market in that situation was you know uh uh there was a panic kind of a situation uh in that time and we capitalized it 11:22 11 minutes, 22 seconds capitalized on it and uh created a good uh profit margins uh from our existing inventories in the first half of the 11:30 11 minutes, 30 seconds year. Second half we you know the market market started to uh you know uh somewhat rationalize the pricing and 11:38 11 minutes, 38 seconds everything was uh conveyed to the market and and we started to grow the markets and started to utilize uh this 11:46 11 minutes, 46 seconds opportunity because there was a supply chain disruption. Some part parts shortage was there and also you know our competitors did not have inventory and 11:55 11 minutes, 55 seconds also we capitalized on those kind of opportunities and uh uh acquired some more customers so that you know it will 12:03 12 minutes, 3 seconds help us uh uh you know grow further uh in our coming years to come and how much is the marketing spend 12:12 12 minutes, 12 seconds you're planning to do uh in FI 2728 FYI 27 uh uh and FYI 28 you know uh this 12:21 12 minutes, 21 seconds year's close to you know it will be approximately 7.5 CR and uh next year it will be close to you know 5 to 6 cr 12:30 12 minutes, 30 seconds because you know this year will be uh celeb onboarding and all those part uh the fees and all will be incorrected and next year also we will be spending on ad 12:39 12 minutes, 39 seconds spins and any update on the interactive panel I think you are planning to have something on that from the government 12:47 12 minutes, 47 seconds any update on Yeah. So our new facility will be operational in uh in a uh 10 15 days 12:54 12 minutes, 54 seconds time. Our uh uh raw materials for those are on pipeline and uh we are in talks with some you know uh some licening 13:03 13 minutes, 3 seconds agents and all who are working for us in the government and uh we have received some positive signals from them. 13:10 13 minutes, 10 seconds Is it with Chhattisgarh or some other government? 13:13 13 minutes, 13 seconds Uh Chhattisgarh government. Yeah, Chhattangar government and um one of our investors is trying for the Maharashtra 13:20 13 minutes, 20 seconds government also. So uh he's trying very hard and he has good contacts in Maharashtra government. So he's trying for the Maharashtra government also. We 13:28 13 minutes, 28 seconds have received some positive signals from Chhattisgarh and quantum if at all we get if you can give a ballpark rate how how big it can 13:37 13 minutes, 37 seconds be. uh those things are not yet revealed by the government because you know uh sometimes they uh issue a big quantum 13:47 13 minutes, 47 seconds tenders at one go or maybe sometimes you know they go for a fragmented basis also. So the strategy how government 13:54 13 minutes, 54 seconds will employ it uh deploy it uh is not known to us right now and it will be done in overall but but uh the overall uh 14:03 14 minutes, 3 seconds requirements is approximately of 400 crores wherein uh which will be deployed in you know uh might be deployed in a 14:12 14 minutes, 12 seconds fragmented basis or maybe a single tender of a big amount can be floated. 14:18 14 minutes, 18 seconds So you hope to crack it in FI27. Is that a possibility? Uh we are trying for that. Yeah. 14:26 14 minutes, 26 seconds And how many districts are you present? 14:28 14 minutes, 28 seconds If you see the reach wise, so if you have something internally you uh measure and how much you want to go uh in FI 27 and 28. 14:40 14 minutes, 40 seconds Currently you know approximately 75 80 districts we are present right now and you know by FY208 you know we are targeting 250 districts. 14:54 14 minutes, 54 seconds Thanks and all the best. Thank you. Thank you. 14:59 14 minutes, 59 seconds Thank you sir. We will take our next question from Miss Deia. Please go ahead. 15:08 15 minutes, 8 seconds Hello sir first of all congratulations for the good set of numbers. So in the last conference call management had 15:16 15 minutes, 16 seconds indicated a target of expanding the distributor network to around 250 distributors. So uh like as you just mentioned right now that uh by 2028. 15:27 15 minutes, 27 seconds So what is the current uh status of this expansion like uh is is it going with your internal expectations? Is the plan going with your internal expectations? 15:38 15 minutes, 38 seconds Uh yes, the plan is going uh as per our internal expectations and uh this year you know we have approximately you know 15:45 15 minutes, 45 seconds close to 80 distributors which we had 10 uh 70 distributors last year and approximately 10 distributors we have 15:52 15 minutes, 52 seconds added and also we have added you know 20 some odd some you know uh large dealers 15:59 15 minutes, 59 seconds who uh large direct dealers who are uh onboarded to our portfolio. So we are 16:06 16 minutes, 6 seconds adding it to adding on to it and also you know uh the existing distributors which were onboarded in last 5 months 7 16:15 16 minutes, 15 seconds months they have also uh started to increase their revenue because you know the new onboarded distributors start slow they don't go all in at first 16:23 16 minutes, 23 seconds because you know they want to have a uh feel of the brand what supports they get and all. So once they are fully 16:30 16 minutes, 30 seconds confident then they start uh selling our products on a uh larger scale. 16:38 16 minutes, 38 seconds Okay. Um and secondly I would like to ask like with the appointment of Vicki Koshell as your brand ambassador should 16:46 16 minutes, 46 seconds we interpret this as a signal that Aram Technologies is looking to strengthen its position in the premium or aspirational segment of the market? 16:55 16 minutes, 55 seconds Uh yes uh we are uh uh looking to stand in our position as uh mass premium brand uh across India. 17:05 17 minutes, 5 seconds Okay. So also does this brand in branding initiative imply any broader shift in the company's go-to market 17:12 17 minutes, 12 seconds strategy or vision particularly in terms of channel engagement distributor economics or product mix or does the 17:19 17 minutes, 19 seconds management continue to see distributor network expansion as a primary growth level going forward? 17:28 17 minutes, 28 seconds No uh distribution network uh expansion will go parallelly but you know what happens is uh when we get a celebrity on 17:35 17 minutes, 35 seconds boarded earlier we were not as good as in online sales because you know uh the brand recall was not much uh higher uh 17:43 17 minutes, 43 seconds and online sales was much more of a cash model but now uh through the marketing campaign and all whatever the uh 17:51 17 minutes, 51 seconds investment we do on the ad spends and all we do not we will not have to you know spend much more on customer acquisition in online markets also. So 17:59 17 minutes, 59 seconds it will open up horizons uh create more opportunities. It will be more easier to tap the online market now and also the 18:09 18 minutes, 9 seconds LFR stores earlier because you know Chroma, VJ sales, everyone had their own private labels which was uh which is 18:17 18 minutes, 17 seconds their primary focus uh uh on sales because you know they get the margins in those products uh better margin in those 18:25 18 minutes, 25 seconds product as compared to LG, Samsung and bigger brands. So now when the brand recall and brand building activity is going on with the celebrity uh we will 18:34 18 minutes, 34 seconds have better chances to place our products in the big electronic store chains uh across India. So that uh the 18:41 18 minutes, 41 seconds chances of opening up the revenue stream from that segment is also you know higher as compared to what we were uh having previously. 18:50 18 minutes, 50 seconds Okay. So if I may ask like uh do you see like expanding this distributor network that we have uh that would drive the primary growth or is it something else? 19:01 19 minutes, 1 second Uh the primary growth will be through dealers and distributor network uh online sales and you know the LFR uh 19:08 19 minutes, 8 seconds opening of the opportunities will be an add-on. Okay. 19:12 19 minutes, 12 seconds And you know uh those two segments are you know uh online also sky is the limit. LFRs also you know once we get up 19:20 19 minutes, 20 seconds you know if we are able to crack all those uh bigger FA uh LFRs with large number of retail chain so you know we'll 19:28 19 minutes, 28 seconds be having a very good uh add-on to our business and we are hopeful we will be able to crack it 19:35 19 minutes, 35 seconds okay yeah thank you thank you thank you we will take our next question from Mr. Pard please go ahead. 19:47 19 minutes, 47 seconds Yeah. Hi, thanks for the opportunity sir and congrats on uh ending F26 on a high note. I see that the revenue growth uh 19:54 19 minutes, 54 seconds has been phenomenal year on year. I just want to understand uh uh that you said that distributor uh network expansion 20:02 20 minutes, 2 seconds will be the key mode uh we can say the key grow driver for uh 3 billion uh revenue target by FY28. I just want an 20:11 20 minutes, 11 seconds elaborative uh explanation on that. How has been the distributor expansion uh strategy for you? Uh you have been 20:19 20 minutes, 19 seconds entering into uh guiding that you will be entering into new markets, new states. So what is the particular 20:26 20 minutes, 26 seconds strategy that you will be adopting as this will be a relatively new markets for you? 20:34 20 minutes, 34 seconds Yeah. So you know what happens is uh whenever we are you know targeting a new territory uh so we generally onboard 20:41 20 minutes, 41 seconds sales teams on the on those territories uh and we uh our sales team visits and uh tries to convince all those uh 20:50 20 minutes, 50 seconds potential distributors uh to get onboarded with us. Parally what we do is lead generation campaigns uh wherein uh 20:57 20 minutes, 57 seconds we have also shot some some of the bites uh of lead generation campaigns uh through the our onboarded celebrity Viki 21:06 21 minutes, 6 seconds Koshel. So that you know uh we have made some bites uh through some research and all. Uh so we will be generating leads 21:15 21 minutes, 15 seconds through the ad uh campaigns and social media filter those leads and our sales team will be visiting them and uh closing the leads. So you know generally 21:24 21 minutes, 24 seconds a distributor or dealer looks at uh uh product quality what after sales support 21:32 21 minutes, 32 seconds what we are providing them and what margins they are getting and what is the potential of brand recall or brand building uh potential of a of a brand. 21:41 21 minutes, 41 seconds So you know we will we check all the boxes uh whatever they look forward to it and uh you know chances of converting 21:49 21 minutes, 49 seconds um converting the leads will be much more higher as compared to what were previous. So we will be you know 21:56 21 minutes, 56 seconds targeting Gujarat, Rajasthan, Punjab uh parts of Jarkand which we are missed right now, Bihar also and some parts of 22:04 22 minutes, 4 seconds you know Maharashtra we are present partially. We would like to expand our print footprints in Maharashtra also. Uh northern region of uh MP is left behind 22:13 22 minutes, 13 seconds Gualar and all those uh region Jasi Gualier and also we would be targeting those regions also. 22:21 22 minutes, 21 seconds Okay. And uh secondly on the uh margin side I see that margins have contracted to about 14% into H2 FIR 26 22:29 22 minutes, 29 seconds particularly. So how do you see uh things unfolding into H1 FI 26 uh 27 till date and what is the uh outlook that you uh offer for FI27? 22:43 22 minutes, 43 seconds You know uh this year what happened was you know there was a volatility in the market and the pricings. So we took the 22:50 22 minutes, 50 seconds advantage of uh lower price inventory in H1 and uh uh in H2 we utilized uh the 22:59 22 minutes, 59 seconds inventory and our supply chain capability to capture a bigger chunk of the market. So majorly you know our pat 23:06 23 minutes, 6 seconds levels margin are onto a similar level but you know we increase the revenue and fixed cost of majority of the components 23:13 23 minutes, 13 seconds were similar. So that's why AITA margin has reduced but you know uh it has uh leveraged us into a similar pack margins what we were generating earlier. 23:26 23 minutes, 26 seconds Uh okay and sir uh the data days have kind of increased you partially mentioned about it uh uh uh sometime 23:34 23 minutes, 34 seconds earlier but what can be an ideal level from your side on the working capital days just any guidance on that? Yeah. So 23:43 23 minutes, 43 seconds ideal level uh you know data days what we are planning is below 90 90 days. Our average data days is approximately 113 23:52 23 minutes, 52 seconds uh this year. And you know uh it has increased because of you know u uh because you know supply in supply chain 24:00 24 minutes in the season uh time uh uh from January to May. What happens is uh you know uh there is a lot of demand in the market 24:08 24 minutes, 8 seconds and uh supply chain is disrupted and sometimes our competitor do not have the inventory to fulfill it. So we uh you 24:15 24 minutes, 15 seconds know what we try to is capture the market and dump the market in uh dump the products in the market so as to you know uh fulfill the appetite of the 24:25 24 minutes, 25 seconds dealers and distributor and then make the collection. So it is done uh through a selective uh set of dealers and 24:32 24 minutes, 32 seconds distributors so as to maintain the safety of our uh uh you know uh data uh 24:40 24 minutes, 40 seconds data uh money and uh we do it uh that way. So you know we average uh data days will be we would like to maintain it below 90. 24:50 24 minutes, 50 seconds Okay. Uh working on the efficiently efficiency of our business on a regular basis. Um you 24:58 24 minutes, 58 seconds know uh we this year we uh very focusedly worked on the inventory days and uh better days is just the uh 25:06 25 minutes, 6 seconds outcome of the expansion what we made in the market in the uh last quarter. 25:12 25 minutes, 12 seconds Understood. Understood. Uh you mentioned that you like to uh spend about 7.5 cr into F2 on marketing spends and about 5 to 6 cr in F28. 25:24 25 minutes, 24 seconds uh so I see that the ad spends are likely to be higher and on top of it there is a RM volatility into H expected 25:32 25 minutes, 32 seconds into FY27. So do you see the uh the uh we can say that uh margin uh pressure is 25:41 25 minutes, 41 seconds likely to continue or do you see kind of it offsetting by operating leverage or anything kind of that? 25:49 25 minutes, 49 seconds Or no, the pricings have already peaked and uh you know uh uh by onboarding the 25:56 25 minutes, 56 seconds celebrity and also know we will be able to uh you know command a better m margins and better negotiation factor uh 26:04 26 minutes, 4 seconds on our deals uh to our dealers and distributors. So you know margins what it used to be till last year will be on a similar trend. 26:14 26 minutes, 14 seconds Okay. Okay. And sir uh could you just uh broadly uh uh indicate what will be the product mix for FI26 26:22 26 minutes, 22 seconds uh is it uh similar to what FI25 has been or it has changed a bit uh you know earlier you know we used to do 70 75% of uh 26:31 26 minutes, 31 seconds televisions this year uh 65% is uh televisions fans we did approximately 26:37 26 minutes, 37 seconds 20%. air coolers we did approximately 14% and 1% was washing machine and mixer 26:45 26 minutes, 45 seconds and after uh the uh ramp up of interactive panels uh what would be the uh kind of contribution it may be there 26:54 26 minutes, 54 seconds maybe uh this year we we are targeting our you know the new plant what we are 27:00 27 minutes invested in uh uh we are expecting to uh c cash in the next air cooler season 27:08 27 minutes, 8 seconds also. So you know this year uh coming year will be you know a bit different. 27:13 27 minutes, 13 seconds Uh our revenues will increase on a television side also but because of the new capacity uh generated in air cooler division. Air coolers will increase fans 27:22 27 minutes, 22 seconds will also increase because of in-house production of uh some components through sheet metal fabrication. So uh we will be able to see growth in fans and 27:31 27 minutes, 31 seconds recruiters also but televisions will be growing it but some percentage share in terms of percentage u fans and might be 27:39 27 minutes, 39 seconds uh increase. [clears throat] Okay sir and uh just uh uh uh 27:46 27 minutes, 46 seconds explanation required on uh the negative other income that I see into H2 FI26 any specific reason for the same? actually 27:53 27 minutes, 53 seconds you know uh in H1 uh the uh interest subsidy which we received uh from the electronics department for tele was 28:01 28 minutes, 1 second regrouped in the H2 actually the auditor regrouped it and uh they set it off uh from the interest uh expense actually so 28:10 28 minutes, 10 seconds that's why that negative uh income it is because of reclassification of the group okay and sir lastly on the capacity 28:18 28 minutes, 18 seconds utilization I see that lastly we had guided that we are aiming to improve it. 28:24 28 minutes, 24 seconds Uh uh so how has been FI 26 and what will be the uh guided levels for FI 2728? 28:33 28 minutes, 33 seconds Yeah, it it it is in improving year on year uh in televisions also our capacity has increased in PA also our capacity 28:41 28 minutes, 41 seconds utilization has increased. So you know uh last year from 30% we are moving towards you know 50% of capacity 28:47 28 minutes, 47 seconds utilization and u we will be adding some more capacities in this uh financial year uh with our new manufacturing. So 28:56 28 minutes, 56 seconds you know it will keep on growing uh on year on year and we are targeting 2 plus 75% capacity utilization by uh FY28 29:05 29 minutes, 5 seconds 75% of our current capacity but uh the newly added capacity will add on uh that's the future part. Okay, as one 29:14 29 minutes, 14 seconds last question that uh in this particular quarter most of the EMS players like uh Dixon Amber has said that the uh the 29:22 29 minutes, 22 seconds human cost that is the staff cost are on rise the wages are on rise uh where I see that for you uh uh it has kind of 29:30 29 minutes, 30 seconds lowered as a percentage of sales. So any any color on that? How do you see that the wages turning out to be an effort 29:37 29 minutes, 37 seconds 27? Will there be an incremental uh change into that or you see it uh kind of uh relatively staying at similar levels? 29:46 29 minutes, 46 seconds Percentage wise it will be on a similar level but we are you know increasing our uh capacity utilization. So absolute in terms of absolute number figures it will 29:55 29 minutes, 55 seconds increase but uh it will be on a similar percentage and also you know uh on a longer percentage will reduce because uh 30:04 30 minutes, 4 seconds whatever the capacity you know what we have the there there is a basic uh requirement of a set of a labor to run a 30:11 30 minutes, 11 seconds plant even if we are operating on a 10% uh capacity. 30:16 30 minutes, 16 seconds So uh so that fixed number of labor requirement always stays but the variable number of labors we do not have 30:23 30 minutes, 23 seconds to increase on a you know the similar proportion uh to what it is uh for the fixed uh labor requirement. So you know 30:31 30 minutes, 31 seconds uh in uh in coming time it will reduce uh in terms of per pricing Dixon and Amber because they are into EMS and uh they are doing contract manufacturing. 30:41 30 minutes, 41 seconds So that's why you know uh the output and all those percentage are increasing but because we have a better margin at our 30:48 30 minutes, 48 seconds uh operationally we are different from uh some tick and amper so that's why our balance sheet looks different from them. 30:58 30 minutes, 58 seconds Yeah. So uh this uh structurally seems to be okay but I just was asking from the uh wage price hikes. So are there any kind of impact or no impact? 31:09 31 minutes, 9 seconds Uh right now we did not see any impact in our region maybe in northern India and southern India there must have a h price hike. 31:18 31 minutes, 18 seconds Yeah. Okay. Thank you. Thanks a lot for the uh information sir and best of luck for FR27. Thank you. Thank you. Thank you. Thank you. 31:28 31 minutes, 28 seconds Thank you. We will take our next question from Mr. Wun Wandi. Please go ahead. 31:35 31 minutes, 35 seconds An this is Vun from Finn Avenue Growth Fund. 31:38 31 minutes, 38 seconds Uh congrats on the good set. You reported 95% yearon-year growth in your revenue. Quite impressive. Could you help me understand how much of this 31:46 31 minutes, 46 seconds growth came from adding new dealers versus the higher throughput from existing dealers? I'm just trying to make a make sense of how much did 31:55 31 minutes, 55 seconds existing dealer network contributed in this growth or and how much did new additions contribute. 32:04 32 minutes, 4 seconds New additions you know uh last year to this year you know they have contributed because you know dealer [clears throat] onboarding is a uh never ending process. 32:13 32 minutes, 13 seconds So you know it is very difficult to uh you know take check on the numbers or take down the numbers. the it takes some 32:20 32 minutes, 20 seconds time but you know uh 70% of the contribution was from uh 32:27 32 minutes, 27 seconds uh approximately 70% of the contribution is from the older dealers and distributors and 30% from new dealers and distributors which we have 32:34 32 minutes, 34 seconds acquainted this year because you know as I earlier said you know the dealers and distributors start uh the business and they start slowly 32:43 32 minutes, 43 seconds they you know uh tend to have a you know feel of the brand and uh the product the after sales service and all the support from the company and 32:52 32 minutes, 52 seconds then you know they start going uh all in for promoting our products. So uh it takes times from for them also to mature 33:00 33 minutes and generate a full potential revenue uh what we are expecting unlisted. So 70% of contribution for an 33:08 33 minutes, 8 seconds existing dealer network. If I have to talk about the existing dealers/distributor network, could you throw some light on 33:15 33 minutes, 15 seconds how many of them are active dealers? Uh by active, we could define active, let's say them purchase or placing a purchase 33:24 33 minutes, 24 seconds order every 3 months, every quarter. Uh is there any number over there that you could highlight? Yeah. So every quarter 33:32 33 minutes, 32 seconds you know if we take on approximately close to 200 dealers and distributor distributors are all active because you 33:40 33 minutes, 40 seconds know they do month billing but uh the dealers approximately close to 200 are active which we uh on the terms which 33:49 33 minutes, 49 seconds you say u quarterly billing and all right and on this this 200 active dealer base how does the cohort look like? uh 33:58 33 minutes, 58 seconds meaning if let's say 3 years ago you onboarded this ex dealer and he placed 34:06 34 minutes, 6 seconds an amount for 100 rupees today how much percentage increase on that on that existing days 34:14 34 minutes, 14 seconds is he ordering more for example is he ordering 120 rupees 130 rupees just trying to understand how much of uh uh 34:21 34 minutes, 21 seconds revenue contribution is coming from existing dealer base growth Did did I frame the correct 34:30 34 minutes, 30 seconds question a bit correctly or did I confuse you? Can you please uh yeah please repeat the question you so for example let's say a t dealer you 34:38 34 minutes, 38 seconds onboarded three years ago ordered one TV today how many TVs must he be ordering from you 34:46 34 minutes, 46 seconds how has how has the dealer matured over its relationship with you know generally uh in terms of active 34:55 34 minutes, 55 seconds dealers and distributors you know what we see uh on a generic sense you know they uh increase their business with us 35:03 35 minutes, 3 seconds you know uh 25 30% in every 6 months. So almost you know uh they uh for example 35:10 35 minutes, 10 seconds if they started with one lakh uh uh billing on a quarter basis so you know uh next quarter they'll be going to 1 35:18 35 minutes, 18 seconds lakh 25,000 then you know you know it takes you know in that sense you know they start to grow. 35:26 35 minutes, 26 seconds Understood. Yes, that's the number I was looking for. I'll uh join back the it it is because you know uh 35:34 35 minutes, 34 seconds because everyone is occupied with uh the set of business they are doing actually. 35:39 35 minutes, 39 seconds So you know uh all the dealers they already have set of products also you know uh 35:46 35 minutes, 46 seconds sometimes it takes time for them to you know get comfortable their sales team also get aligned with the new products they have about it. So sometime you know 35:55 35 minutes, 55 seconds it takes some times uh to full generate full potential revenue for that. So as a followup to this exact same 36:04 36 minutes, 4 seconds conversation uh how in your experience what is the typical life cycle for a dealer to show that maturity in his 36:12 36 minutes, 12 seconds purchase purchase uh ability. 36:20 36 minutes, 20 seconds Exactly. You know to be frank uh there is it cannot be determined because you know uh it it is totally depend on the 36:28 36 minutes, 28 seconds what kind of brand value we are commanding in the market. So as and when our brand value is increasing parallelly 36:34 36 minutes, 34 seconds uh with the uh contribution of dealers he he's also pushing our products but you know the uh marketing activities what we are doing in the market. So it 36:43 36 minutes, 43 seconds also helps generate some organic inquiries to the dealers and distributors. So you know it is not just uh dealer and distributor. It is a combined and cumulative effort which 36:52 36 minutes, 52 seconds results into you know revenue growth for material. All right I'll join back in the queue. 37:00 37 minutes Thank you. 37:01 37 minutes, 1 second Thank you. Participants who would like to ask a question may raise their hand using the raise hand feature available. 37:13 37 minutes, 13 seconds We have a next question from the line of Mr. Dal Panda. Please go ahead. Am I audible? 37:23 37 minutes, 23 seconds Hello. 37:23 37 minutes, 23 seconds Yes. Yes, you're audible. Please go ahead. 37:25 37 minutes, 25 seconds Okay. Thank you. Uh Anki G, my first question will be with regards to the post promoter holdings after the warrants are converted. Can you please share that? 37:35 37 minutes, 35 seconds It will be close to 58% after the warrants will be converted. 37:39 37 minutes, 39 seconds Okay. And uh sir my one question is with regards to this new land that we have bought also and currently this year we 37:46 37 minutes, 46 seconds are using the capacity at around 50%. So uh just want you to understand the voice is very low. Uh 37:54 37 minutes, 54 seconds can you check with uh your microphone or something please? Hello. 38:02 38 minutes, 2 seconds It is better now. Yeah. Better. Yeah. 38:06 38 minutes, 6 seconds Yeah. So my question is with regards to the capacity utilization we have today it's around 50% that you said uh and we 38:13 38 minutes, 13 seconds are targeting around 75%. So my question is that uh what is the optimum utilization of this capacity and 38:22 38 minutes, 22 seconds what happens when we start with the new land that we acquire and we will be you know adding new products over there also. So just wanted to understand uh 38:29 38 minutes, 29 seconds will it not be under capacity before we go with the new uh uh capacity that we 38:35 38 minutes, 35 seconds might bring in? Uh it you know uh it [clears throat] is a type of backward 38:41 38 minutes, 41 seconds integration. So you know uh it will not add up much more capacity because uh capacities in terms of you know u 38:50 38 minutes, 50 seconds currently we are u uh manufacturing uh coolers uh uh coolers in house and we are doing the assembly of air coolers. 39:00 39 minutes So the injection molding part is not done in house that will uh be done in house. The motors we are not manufacturing it in house that will be 39:09 39 minutes, 9 seconds done in house and also the an assembly part air coolers uh capacity will be increased and in terms of you know other 39:16 39 minutes, 16 seconds products like televisions and also uh the cabinets will be manufactured in uh the newer capacity newer facility but 39:24 39 minutes, 24 seconds the ent the uh production capacity of uh televisions uh will be remaining the same uh because uh the assembly the 39:33 39 minutes, 33 seconds final assembly capacity is approximately uh 300,000 numbers uh peranom. 39:39 39 minutes, 39 seconds Understood. Sir, when is this capacity coming into uh into our company and what is the amount that we spending on this? 39:48 39 minutes, 48 seconds Uh which one? Uh the newer uh the newer yeah the recently acquired we are targeting uh to you know uh start production by January. 39:58 39 minutes, 58 seconds By January what is the amount that we investing sir in this? Uh close to 40 crores. 40:04 40 minutes, 4 seconds 40 crores. Okay. So one last question uh just to understand if we are planning any new product maybe air conditioning 40:12 40 minutes, 12 seconds or something looking at the you know current situation of what India has been going through. Uh just want your views as to if you think uh air air 40:21 40 minutes, 21 seconds conditioning will be something that we might look into the future. We might look into the future but we do not have any plans right now because you know 40:29 40 minutes, 29 seconds what what what we are doing with what we are planning with our upcoming facility the production line uh because it is 40:38 40 minutes, 38 seconds plastic injection molding and sheet metal fabrication. So we will be having the capacity to manufacture the indoor 40:46 40 minutes, 46 seconds air conditioners and the outdoor unit air conditioner. Indoor unit is the plastic injection molding part. Outdoor 40:53 40 minutes, 53 seconds is the sheet metal fabrication part and uh the line is of air conditioners and 41:02 41 minutes, 2 seconds air coolers are somewhat similar. We will be making it uh you know uh equipped uh if you want to add on some air 41:10 41 minutes, 10 seconds manufacturing. So we will enable our so that we have the option to add on that facility in our uh production capacity. 41:20 41 minutes, 20 seconds Okay. And this will be under our own brand only right if happens. Yes. Our own brand. 41:26 41 minutes, 26 seconds Okay. Understood. Thank you. I'll fall back in the queue and all the best to team Aram for this coming up. Thank you. Thank you. 41:33 41 minutes, 33 seconds Thank you. Our next question is from the line of Mr. Ashi Sony. Please go ahead. 41:39 41 minutes, 39 seconds Fundra. You said you have used almost 27 odd 10 you plan to spend uh rest this year. So can you give break up of that? 41:46 41 minutes, 46 seconds How much has been spent in what activities or uh heads you can give break up? 41:54 41 minutes, 54 seconds Yeah. So you know uh our fund raise was majorly for working capital and uh close to 8 8.5 crores was uh uh supposed to be 42:04 42 minutes, 4 seconds used for uh the building of plant and machinery. That fund has been already deployed in our subsidiary uh for uh the 42:11 42 minutes, 11 seconds manufacturer of the plant and machinery and uh the installation setup of uh uh the building what we uh uh had announced 42:20 42 minutes, 20 seconds in our preferential round and remaining has been utilized for uh working capital working capital 42:29 42 minutes, 29 seconds and you spoke about uh the price increase and also for your products. So and you said the margin will stay in 42:36 42 minutes, 36 seconds line with last year maybe this year or next year. So but do you think uh when do you think you can get a inflection 42:43 42 minutes, 43 seconds point where you will be able to really get a pricing power and use your the branding or marketing what you're doing 42:51 42 minutes, 51 seconds maybe which year do you think it can be FI28 or it can be greater? I'm just trying to understand what's the management view. um it will start to you 43:00 43 minutes know uh create a you know a positive impact on our margins from this year onwards. uh but you know the ad spends 43:07 43 minutes, 7 seconds will uh again you know uh rationalize it uh but you know uh from next year onwards FI28 onwards uh the once because 43:16 43 minutes, 16 seconds you know it takes uh initial uh capex to bring up build a brand but you know afterwards the ad spends are not 43:25 43 minutes, 25 seconds required to that to that extent what we are currently needing it. So you know uh the ad spend will start to reduce and our revenues will continue to grow. So 43:34 43 minutes, 34 seconds the margins will be improving uh uh continuously year on year after FY28 and you spoke about large format 43:43 43 minutes, 43 seconds retailers. So uh based on your branding and other activities do you think you'll be able to crack uh one of them or or 43:51 43 minutes, 51 seconds maybe more by this year or next year and how's the discussion going because now your visibility is increasing right? 43:59 43 minutes, 59 seconds Yes. So you know uh once we are you know it it does not make sense to approach them right now. We approached them last 44:06 44 minutes, 6 seconds year but uh their view was you know uh uh to continue to focus on their own brand. So uh once we are through with 44:16 44 minutes, 16 seconds this ad campaign uh of Vicki Koshel which we did a shoot on uh uh 25th. So 44:22 44 minutes, 22 seconds we will be you know uh approaching them after uh a full-fledged visibility what we have uh in terms of brand. 44:32 44 minutes, 32 seconds So do they have any criteria based on which they like onboard uh new brands? 44:37 44 minutes, 37 seconds No, no, they don't have the criteria but uh what happens is their prime focus is uh their own in-house brand uh because 44:46 44 minutes, 46 seconds it gives a better margins uh to them and secondly you know uh whatever other brand they onboard it should sell easily 44:55 44 minutes, 55 seconds uh that's their criteria it uh the inventory uh they look more on you know uh the shelf life of the product should 45:03 45 minutes, 3 seconds be less it should be very liquidable Mhm. 45:08 45 minutes, 8 seconds Okay. So you hope basically what I'm hearing is you hope to onboard few of them this by end of this year sort of thing if I understand correct. 45:16 45 minutes, 16 seconds Yes. Yes we are trying to you know that's a fact. 45:20 45 minutes, 20 seconds And any other risk or challenges do you see for your business plan or based on what you have seen or learned over last one or two years? 45:30 45 minutes, 30 seconds you know majorly it geopolitics and government uh policies are you know uh 45:37 45 minutes, 37 seconds the risk what we see actually because you know if suddenly uh prime minister comes and say you know we don't import 45:45 45 minutes, 45 seconds from China and all so know those kind of scenarios will be a very big uh challenge for us but we don't see you 45:53 45 minutes, 53 seconds know it happening because you know we are dependent on China to somewhat uh a 45:59 45 minutes, 59 seconds lot exp uh extent and uh maybe a war a big war happening or something you know 46:05 46 minutes, 5 seconds that will again uh dis uh will be a challenge to the business. 46:12 46 minutes, 12 seconds Okay. So thanks and all the best. Thank you. Thank you. 46:16 46 minutes, 16 seconds Thank you. We will take this question as the last question. I will now I would like I would now like to hand over the call to Mr. Ankit Jin for the closing remarks. 46:30 46 minutes, 30 seconds Thank you all for your excellent questions and taking the time to engage with us today. The next 18 months are pivotal. We will commission new 46:39 46 minutes, 39 seconds manufacturing capacity, deepen our backward integration, scale our distribution reach into new states and build on the brand equity that Vikos 46:47 46 minutes, 47 seconds association is helping create. Each of these initiatives has a defined timeline and accountability. We remain deeply 46:56 46 minutes, 56 seconds grateful to our shareholders, analysts, lenders, employees, and dealers and distributor partners who have trusted us 47:04 47 minutes, 4 seconds on this journey. Thank you once again for joining us today. We look forward to updating you on our progress at our next 47:11 47 minutes, 11 seconds quarterly communications. Have a pleasant evening. Thank you. Thank you, sir. Thank you, participants. 47:19 47 minutes, 19 seconds That concludes our