Arvind Limited — Q4 FY26

Arvind Ltd Q4 FY2025-26 Earnings Conference Call https://www.youtube.com/watch?v=yY59PPwBmEU Published: 4 hours ago

0:01 1 second Ladies and gentlemen, good day and welcome to the Arvent Limited Q4 FI26 earnings conference call. As a reminder, 0:10 10 seconds 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. 0:19 19 seconds Should you need assistance during this conference call, please signal an operator by pressing star then zero on your touchstone pole. 0:28 28 seconds Please note that the conference is being recorded. I now hand the conference over to Mr. 0:33 33 seconds Satya Praash Mishta. Thank you and over to you sir. 0:38 38 seconds Good morning everyone and a very warm welcome to the Arvin Limited earnings call for the quarter and full year ended March 2026. 0:47 47 seconds The financial results for the quarter and related presentations were uploaded to our website. Hope you had enough time to go through it. Before we begin the 0:56 56 seconds call, let me introduce the leadership team that I have with me. Uh we have Mr. 1:01 1 minute, 1 second Punit Lalhai the vice chairman. Mr. Jay Sha wholetime director and group CFO, Mr. Nigam Sha, executive director and 1:08 1 minute, 8 seconds CFO of Farin Limited, Mr. Gautrit Singh Bhya, CEO and president of AMD Business. 1:17 1 minute, 17 seconds I'm very happy to inform you that the journey of Arvin Limited has taken a defining turn to become a truly global 1:23 1 minute, 23 seconds organization. We intend to continue this in the foreseeable future and expand our horizons beyond the boundaries of India 1:31 1 minute, 31 seconds while being deeply rooted in our place of origin. We remain optimistic and upbeat about India's long-term growth 1:39 1 minute, 39 seconds story and are fully aligned to capture the opportunities in the world's largest population center. Over the long term, 1:46 1 minute, 46 seconds our well- diversified business model with an equal contribution between exports and domestic markets positions us strongly and helps us insulate the company from macroeconomic volatility. 1:58 1 minute, 58 seconds Walking all of you back down the memory lane, let me remind you all that we have started the financial year 2526 with a 2:06 2 minutes, 6 seconds severe disruption in trade due to imposition of tariff by USA. However, Arvind has started the fiscal year 2:13 2 minutes, 13 seconds 202526 on a stable footing, proactively absorbing tariff related pressures and realigning its businesses to navigate 2:21 2 minutes, 21 seconds the challenging macro environment. A disciplined approach led the foundation for a strong second half highlighting the agility of our operating platform. 2:32 2 minutes, 32 seconds Despite multirong disruptions, we remain focused on ex execution excellence, cost optimization and deepening customer 2:40 2 minutes, 40 seconds engagements enabling us to deliver consistent growth. 2:45 2 minutes, 45 seconds Coming to the operational performance during the quarter and the full years, we witnessed strong volume growth across all core segments during the quarter in 2:54 2 minutes, 54 seconds line with our guidance. Denim volume grew by 19% to 17 million m with full year volume at 60 million m up 15%. 3:05 3 minutes, 5 seconds Woven fabric grew by 5% to 35 million m taking full year volume to an all-time high of 136 million m. The garmenting 3:14 3 minutes, 14 seconds business continued its strong trajectory crossing 10 million mark for the third consecutive quarter in a row. For the 3:21 3 minutes, 21 seconds full year, the volume reached 42 million pieces, which is up 12%. 3:27 3 minutes, 27 seconds Advanced materials delivered a robust performance with growth in line with our guidance of 18 to 20% growth in this 3:36 3 minutes, 36 seconds year. This was supported by a favorable product mix, operating leverage and reversal of earlier expense provisions 3:43 3 minutes, 43 seconds made during the year uh to take care of tariff. 3:47 3 minutes, 47 seconds ITA margins improved by 200 basis points in quarter 4. On a fullear basis, the business continues to maintain a sustainable margin profile of 15%. 3:59 3 minutes, 59 seconds Coming to the financial performance for quarter 4, consolidated revenue and IBITa stood at 2553 4:07 4 minutes, 7 seconds crores and 327 crores reflecting a growth of 15% and 19% respectively. 4:14 4 minutes, 14 seconds For the full year, revenue grew by grew by 12% to 9,33 crores with an IITA of 1,61 cr and a margin of 11.4%. 4:26 4 minutes, 26 seconds Important in this to note that the IITA for the first time has crossed 1,000 cr. 4:33 4 minutes, 33 seconds The textile segment reported revenue was at 6,897 cr for the year, up 12% with IITA margin of 10.3%. 4:44 4 minutes, 44 seconds The garmenting segments delivered strong growth of 21% with revenue crossing 2,000 cr. 4:52 4 minutes, 52 seconds Advanced materials division reported a record performance during the quarter and year with a revenue of 1,839 5:00 5 minutes crores up 21% and EITA margin of 51 15.1%. 5:07 5 minutes, 7 seconds Full year profit after tax grew by 21% to 444 crores with return on capital 5:14 5 minutes, 14 seconds employed improving by 120 basis point to an all-time high of 15 14%. 5:21 5 minutes, 21 seconds Uh the number is 15.7% if we remove capital uh work in progress from the uh calculations. 5:31 5 minutes, 31 seconds Naked during the similar period reduced by 112 crores to reach 1,172 5:38 5 minutes, 38 seconds crores supported by a strong free cash generation. 5:43 5 minutes, 43 seconds In terms of capital allocation and balance sheet, we continue to maintain a disciplined approach to capital allocation. During the year, we invested 5:52 5 minutes, 52 seconds approximately 486 crores in growth capex. Our balance sheet has strengthened meaningfully over the past 5:59 5 minutes, 59 seconds few years driven by a prudent capital structure, rationalized debt profile and consistent free cash generation. 6:07 6 minutes, 7 seconds In line with our dividend policy, the board has recommended a dividend of 4.5 rupees per share translating into a 6:14 6 minutes, 14 seconds payout of 28.5% of profit after tax reported. This is subject to shareholders approval 6:23 6 minutes, 23 seconds during the quarter gone by. uh during the previous month we have announced the acquisition of 61% stake in US-based 6:32 6 minutes, 32 seconds Dalco GFT through our wholly owned subsidiary of Arvin Advanced Materials Limited marking our journey marking our 6:40 6 minutes, 40 seconds entry into world's largest technical textile market. This is a strategically important step strengthening our 6:48 6 minutes, 48 seconds presence in specialized non-ovven segment and expanding our global footprint. The acquisition is expected 6:55 6 minutes, 55 seconds to be margin and EPS accretive from the first year. In subsequent years, it is expected to unlock meaningful synergies over time. 7:06 7 minutes, 6 seconds Looking ahead, the global environment remains uncertain with ongoing disruptions including evolving situations in the Middle East impacting 7:15 7 minutes, 15 seconds input costs, supply chains, and currency movements. While the near-term risk persists, demand across textile and 7:24 7 minutes, 24 seconds advanced materials remains resilient and key sourcing destination continues to be stable for now. We are entering FI27 7:33 7 minutes, 33 seconds with a healthy order book position and a strong inquiry pipeline. We expect to maintain the growth momentum to grow at 7:41 7 minutes, 41 seconds a double digit with high double-digit growth in advanced material and mid- teen growth in garments. 7:48 7 minutes, 48 seconds However, there may be disruptions in demand especially in second half due to increase in inflation and other global 7:55 7 minutes, 55 seconds uncertaintities impacting discretionary consumption. 7:59 7 minutes, 59 seconds Input costs across product lines have risen sharply which may exert margin pressure in first half of FY27. 8:09 8 minutes, 9 seconds While the margin recovery is expected in second half, this is subject to easing of geopolitical tensions. 8:16 8 minutes, 16 seconds We will continue to invest in growth with planned capex of 450 to 500 crores in FY27. 8:24 8 minutes, 24 seconds This will be funded through internal approvals. At the same time, we remain focused on aligning stakeholders interest and enhancing long-term 8:33 8 minutes, 33 seconds returns. Please note that the outlook that I have given earlier uh does not include the financial impact of 8:41 8 minutes, 41 seconds acquisition of Dalco and its consolidation into Arvin's books. We will provide a detailed update on that in coming quarter. 8:50 8 minutes, 50 seconds Let me close by reiterating that the company is well positioned to navigate the current environment and deliver 8:57 8 minutes, 57 seconds sustained profitable growth. Our diversified portfolio, dis uh disciplined execution and capital 9:05 9 minutes, 5 seconds allocation underpin the margin improvement and stronger return ratios and superior cash generation capability 9:12 9 minutes, 12 seconds while managing near-term uncertaintities with agility. We remain firmly focused on long-term value creation through 9:19 9 minutes, 19 seconds targeted investments, portfolio premiumization, and balance sheet strengthening. 9:25 9 minutes, 25 seconds Thank you. We can now open the floor for questions. 9:34 9 minutes, 34 seconds Thank you very much. We will now begin with a question and answer session. 9:38 9 minutes, 38 seconds Anyone who wishes to ask a question may press star and one on the touchstone telephone. 9:46 9 minutes, 46 seconds If 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. 9:56 9 minutes, 56 seconds Before we proceed, ladies and gentlemen, in order to ensure that the management will be able to address all the 10:03 10 minutes, 3 seconds questions from the participants in the question queue, we request you to kindly limit your questions to two per participant. 10:10 10 minutes, 10 seconds If you have a follow-up question, please rejoin the queue. Again, we will now wait for a moment while the question ascends. 10:22 10 minutes, 22 seconds We have the first question from the line of Aradna Jen from 361 Capital. Please go ahead. 10:29 10 minutes, 29 seconds Hi, thank you for the opportunity and uh congratulations on the good set of numbers. Uh couple of questions first on the garmenting business. uh if you could 10:38 10 minutes, 38 seconds just help us understand what are the growth levers in the garmenting business which gives us the confidence that we'll be able to achieve the mid- team kind of 10:46 10 minutes, 46 seconds growth like is it on the back of the recent capacity expansion that we've done uh the new client additions that we are getting better utilization 10:53 10 minutes, 53 seconds realization and how should one look at the realizations going ahead because if we see the last two three years the realizations were not growing but this 11:03 11 minutes, 3 seconds year there's been a increase in the realizations high single kind of realiz ation growth. So what would be the growth levers in the governmenting 11:11 11 minutes, 11 seconds business which gives us this confidence and a second part to this question is if we could also highlight what is the current margins that we are making in the governmenting division and if 11:20 11 minutes, 20 seconds there's any cost or operational efficiencies that we are able to bring in in the governmenting side of business which can help improve the margins. Yeah, that's my first question. 11:29 11 minutes, 29 seconds Sure. Uh thank you for the question. Um so the growth in garmenting is you know almost automatic. 11:38 11 minutes, 38 seconds Um the demand from to buy from India is very high with pretty much every global 11:46 11 minutes, 46 seconds buyer needing to derisk uh Bangladesh and Vietnam uh particularly. So India 11:54 11 minutes, 54 seconds will always be a preferred destination um to source garments. 12:00 12 minutes The challenge is India is a supply constraint geography. So you know people our government industry is not growing because we don't have capacities. 12:11 12 minutes, 11 seconds So the moment we create capacities growth will come. So we don't have to really work very hard to to fill order books as far as garments is concerned. 12:21 12 minutes, 21 seconds If you're a good garmenter with you know integrated capabilities, diversified uh product portfolio like us um the order book should should not be the hard part. 12:32 12 minutes, 32 seconds Um so the um growth will come from the capacities we've already created. Um we 12:40 12 minutes, 40 seconds have moved um uh capacities to from you know high 40 million range to mid50s 12:49 12 minutes, 49 seconds already. So this year we should you know be somewhere in that that um that that 12:55 12 minutes, 55 seconds ballpark and you know for us garmenting is just a vertical integration. 13:02 13 minutes, 2 seconds These it's the same customers that are buying fabric from us that want to now you know sort of be 13:09 13 minutes, 9 seconds having a one-stop shop type of um uh situation with us. It it gives them a lot of ease of operation um not having 13:18 13 minutes, 18 seconds to connect the dot between dots between uh multiple suppliers. And as far as realizations go, it is of course product 13:28 13 minutes, 28 seconds mix linked. Um um we have knits which is slightly lower realization and then we 13:35 13 minutes, 35 seconds have shirts and denim which which have higher realizations. Um and even within product category it depends on 13:44 13 minutes, 44 seconds excuse me, the product mix. So, you know, realization will be product mixled. I would say things are on track. 13:51 13 minutes, 51 seconds Um, and we should be able to grow this in the high teens. Um, going forward as 13:58 13 minutes, 58 seconds far as margin is concerned. Um, because we are still in investment mode, there are certain factories that are at lower 14:06 14 minutes, 6 seconds margins. There are certain factories that are um, you know, higher margins. 14:12 14 minutes, 12 seconds Um uh so you know I would say our average blended margin is in the high single digits a bit um which over a 14:21 14 minutes, 21 seconds period of time we will want to get into the mid teens you know that's the journey that is still going to take you 14:28 14 minutes, 28 seconds know a couple of years to to um go through. Uh and we are continuing to 14:34 14 minutes, 34 seconds further expand uh into garments. Um that's uh that's you know one of the 14:42 14 minutes, 42 seconds ways in which we will grow uh advanced materials garment expansion and now a 14:49 14 minutes, 49 seconds third pillar of globalization of footprint. I think these would be the avenues that will allow us to grow 14:57 14 minutes, 57 seconds and uh so is there any labor issue that we would be facing because of the uh you know inflation and the west Asia or war 15:04 15 minutes, 4 seconds related issues at our governmenting facility right now or do we foresee that in the near term 15:10 15 minutes, 10 seconds garmenting business is people management mostly so your it you know it is always 15:19 15 minutes, 19 seconds about managing people Our strategy is to automate so that we 15:26 15 minutes, 26 seconds can have the highest productivity per person. Um and we are constantly 15:33 15 minutes, 33 seconds innovating and automating to to ensure that happens. Meanwhile, we have to have very people friendly HR practices that 15:42 15 minutes, 42 seconds that lead to higher retention of of skilled manpower. So these are all day-to-day 15:49 15 minutes, 49 seconds um sort of activities as a garment manufacturer and I don't see any 15:57 15 minutes, 57 seconds anything specific to the West Asia conf conflict that that is going to impact the garmenting industry. Um if I mean 16:07 16 minutes, 7 seconds you know if inflation goes up people will be in more need of of stickiness of of jobs. So I don't see that as a as a 16:15 16 minutes, 15 seconds negative but overall labor management uh is a is the main sort of value driver uh 16:25 16 minutes, 25 seconds in government if you are able to have high productivity if you are able to uh have good retention then you know the business uh becomes successful. 16:36 16 minutes, 36 seconds Understood. Uh my second question uh is on the AMD division. uh what are the advanced materials limited so now it's 16:45 16 minutes, 45 seconds no longer a division it's a company sorry to interrupt you please continue with the question sure uh so what could be the lead 16:53 16 minutes, 53 seconds indicator that one should be you know uh assessing the uh advanced material uh you know side of things like from order 17:01 17 minutes, 1 second book perspective uh uh should we be looking at order book visibility that should give us confidence in that particular uh segment of yours Is that 17:10 17 minutes, 10 seconds and how long as a tenure do we have the audibility for? Like is it for 3 months, 6 months that we are sure that we have an order book visibility or is it for a 17:18 17 minutes, 18 seconds longer period and how many new client editions would we be doing on a year to year basis and uh if you could also give 17:26 17 minutes, 26 seconds some guidance on the EIA side of things that now that the DO will be integrated into us uh how should we look at the EIA 17:35 17 minutes, 35 seconds margins because this quarter itself we've seen a 200 bit improvement uh can we expect that to be on a steady state 17:42 17 minutes, 42 seconds basis again I understand that it is because of the product mix uh uh you know driven by that but going forward what should be a steady state AITA margin uh for the AMT division. 17:53 17 minutes, 53 seconds See that this is a rather complex question and uh Arvin the advanced materials is a complex business. So the 18:00 18 minutes answer varies from product category to product category. Um the way to think about it is that you know we have the visibility to grow at 18 to 20%. 18:14 18 minutes, 14 seconds Um we have um you know the margin is likely to be around um 15% to 16%. 18:25 18 minutes, 25 seconds That's the sort of uh um you know range that we are targeting. uh quarter in 18:32 18 minutes, 32 seconds quarter out some quarters there could be you know higher some quarters there could be lower just just uh as a result 18:39 18 minutes, 39 seconds of uh of of product mix so it's basically 18 to 20% growth and 15% EITA 18:47 18 minutes, 47 seconds margin with hopefully a rosi that will you know um keep growing um uh you know 18:55 18 minutes, 55 seconds to very interesting levels um that and with Dalo um Dalco is a margin in accretive acquisition. It is also in the 19:04 19 minutes, 4 seconds high teens in terms of EITA margin. So it doesn't dilute our our margin profile. Um but it increases our avenues 19:13 19 minutes, 13 seconds of growth and um global reach. Uh so that's how you should look at the business. 19:21 19 minutes, 21 seconds Understood. Thank you. I'll join the queue for follow-ups. 19:27 19 minutes, 27 seconds Thank you. We will take the next question from the line of Ronaksha from Equir Securities. Please go ahead. 19:34 19 minutes, 34 seconds Yeah, thanks for the opportunity sir. My first question is broader on macro terms. So considering the current geopolitical tension and the volatile 19:44 19 minutes, 44 seconds environment how the industry is realigning and if you can call out certain specific measures which the industry as a whole are taking to mitigate such risk. 19:56 19 minutes, 56 seconds So that's a good question. I think this is the question on all of our minds as well. So you know the um it it seems 20:05 20 minutes, 5 seconds like to deliver a good performance we are having to be having to work harder and harder and in that context I would like to place on record the fantastic 20:15 20 minutes, 15 seconds job the team has done in navigating you know what already was a very challenging 20:20 20 minutes, 20 seconds environment in in Q4. Um as far as the year that we are we have just entered is 20:29 20 minutes, 29 seconds concerned it's a tale of two halves if you ask me. The first half is you know very deeply characterized by both strong 20:37 20 minutes, 37 seconds demand but very very erratically and fast increasing uh input costs. So you know 20:46 20 minutes, 46 seconds cotton has gone up, yan has also gone up disproportionately. 20:50 20 minutes, 50 seconds Um all petroleumbacked inputs like energy so we use lot of gas for for our 20:58 20 minutes, 58 seconds textile processing uh that's gone up uh Dyson chemicals have gone up um polymers have gone up so polyesters nylons 21:07 21 minutes, 7 seconds elastain all have gone up so uh it's a question of being able to you know sort 21:14 21 minutes, 14 seconds of manage in this uh inflationary environment when we are having when we have already locked in long-term prices. 21:23 21 minutes, 23 seconds Uh we've also locked in a good chunk of raw materials. So we are able to manage but there is going to be margin pressure in the first half and the second half uh 21:32 21 minutes, 32 seconds the worry is uh will this robust demand uh you know environment actually hold? 21:40 21 minutes, 40 seconds Uh if the oil stays at between $1 and $120 a barrel, um it is conceivable that 21:48 21 minutes, 48 seconds you know people will will not have enough disposable income to to to 21:55 21 minutes, 55 seconds drive the demand that we are seeing today. So all of this needs to be factored in and it it's too early to 22:03 22 minutes, 3 seconds have a have an answer on on some of these but I think what we have shown is that you know our business model is 22:11 22 minutes, 11 seconds quite resilient you know we've seen shock after shock you know since covid we've seen the 22:18 22 minutes, 18 seconds Ukraine war then we have seen tariffs now we are seeing this environment in all these environments we found a way so 22:26 22 minutes, 26 seconds you know I I I believe in our team that they will you know continue to find a way and yes there might be some quarters 22:33 22 minutes, 33 seconds where you know some of these pressures lead to um a slightly muted performance there may be some quarters where you 22:41 22 minutes, 41 seconds know we will soldier through and deliver very very good set of numbers I think overall medium-term 22:48 22 minutes, 48 seconds um our our thesis around our growth model um pushing garments pushing uh 22:55 22 minutes, 55 seconds advanced materials is um driving efficiency, automation, digitization, globalizing our manufacturing footprint. 23:05 23 minutes, 5 seconds All of these I think are uh is a is a winning strategy. And so I'm very bullish about, you know, sort of the 23:14 23 minutes, 14 seconds medium-term, but the short term is characterized by a lot of these challenges um that are uncertain by the very nature. we don't we don't have 23:22 23 minutes, 22 seconds enough information to to to predict the future but um and it's challenging to manage day-to-day but the team is doing 23:30 23 minutes, 30 seconds a good job. So that's the that's how I'd like to respond to this question. 23:36 23 minutes, 36 seconds So just a small followup to this. So when we see the first half of FY26 visa v second half we have relative lower base uh on annualized base. So when we 23:45 23 minutes, 45 seconds when the management is seeing some margin pressure into the first half, it is more to do with the annualized comparison or you are sensing pressure compared to the first half of FY26. 23:56 23 minutes, 56 seconds No. So I think I'm just seeing pressure now compared to FY26. 24:02 24 minutes, 2 seconds I think we should still be okay, you know. I mean we should be we shouldn't be worse than 26. Um that's at least my 24:09 24 minutes, 9 seconds feeling uh sitting early in 27. Um but uh there will be some margin pressure. 24:17 24 minutes, 17 seconds Um and my margin pre my observations are always indexed to what could have been 24:26 24 minutes, 26 seconds or what was you know in the very recent past. So I think um compared to Q4 we 24:33 24 minutes, 33 seconds are facing more margin pressure um and maybe Q2 will face even more margin pressure and uh and uh but compared to 24:43 24 minutes, 43 seconds last year maybe you know there will be other factors that will you know sort of allow us to do uh not worse than last year at least. 24:53 24 minutes, 53 seconds Understood. Understood. And just last a follow up on the uh someone bookkeeping question sir can you elaborate the current installed capacity into the sub 25:01 25 minutes, 1 second each sub segment and how you are looking to expand it over next two to three odd years I'm sorry can you repeat that 25:09 25 minutes, 9 seconds so can you s uh just uh highlight what are the current installed capacity into the each sub segment be it your denium wan or garmenting and how you are in 25:18 25 minutes, 18 seconds trying to expand over next two to three odd years considering the capex plan which we are So fabric will expand marginally. I mean 25:26 25 minutes, 26 seconds maybe 5 7% expansion in capacity is coming after a very long time. We have gone ahead and we've done some expansion 25:35 25 minutes, 35 seconds in our knitting capacity because our verticalization percentage is is quite high in knits and if you want to grow we 25:43 25 minutes, 43 seconds also will need to grow the fabrics. So we are putting in fabrics. uh uh this year we are growing denim in an asset 25:52 25 minutes, 52 seconds light model uh a little bit because the demand environment is very good and the last bit of uh sort of capacity that we 26:00 26 minutes had added in wovens um maybe two years ago is now almost reaching 100%. So there could be some volume growth there 26:08 26 minutes, 8 seconds as well. So on the fabric side it is um you know sort of very strategic volume 26:14 26 minutes, 14 seconds growth in in in garments we will we we will grow capacity by about 20% uh uh 26:21 26 minutes, 21 seconds this year and advanced materials also we are um putting in capexes uh in the India business to grow at 18 26:31 26 minutes, 31 seconds to 20% and and of course Dalo also has capex plans to grow in the mid- teens Understood. Understood. That's it from my side. Thanks a lot. 26:44 26 minutes, 44 seconds Thank you. We will take the next question from the line of Praa Junjunwalana from Securities. Please go ahead. 26:52 26 minutes, 52 seconds Thank you for the opportunity and congratulations on strong set of numbers. 26:58 26 minutes, 58 seconds Just wanted to understand um it's been a fantastic year amid headwinds uh for you. Uh could you help us understand 27:06 27 minutes, 6 seconds what went right for us? Any strategic level initiatives that are sustainable 27:13 27 minutes, 13 seconds that could cushion us from the coming uh headwind of input cost in uh inflation that is coming in. There's some um you 27:22 27 minutes, 22 seconds know strategic level initiatives that would highlight the strength of standing business model. That's my first 27:29 27 minutes, 29 seconds question. So I think you know I would see this performance as a validation of 27:35 27 minutes, 35 seconds our strategy. Um we've always believed we can perform well. Um so I think it's just following through on that belief 27:44 27 minutes, 44 seconds and delivering what we can. Of course you know the results could have been significantly better had it not been for 27:52 27 minutes, 52 seconds some of those headwinds. So uh you know the headwinds do have an impact. um but one must have a business model that is 28:01 28 minutes, 1 second resilient to to these impacts. I think um the growth of advanced materials um is one such factor which is less 28:09 28 minutes, 9 seconds affected by you know some of these um these global headwinds. Um there is the 28:16 28 minutes, 16 seconds fact that we have focused a lot on on efficiency and cost takeout and and um 28:23 28 minutes, 23 seconds and productivity. I think some of those those efforts are are are kicking in. Um 28:31 28 minutes, 31 seconds we are also trying to have you know um a manufacturing footprint that takes 28:40 28 minutes, 40 seconds advantage of pockets of opportunity and and relative um competitive advantage from a 28:47 28 minutes, 47 seconds geopolitical perspective. So products starting to go from Egypt is one such 28:53 28 minutes, 53 seconds example. uh having you know a factory in in the US uh now with the Dalco 29:01 29 minutes, 1 second acquisition uh is is there um we have a very diversified business portfolio. We 29:10 29 minutes, 10 seconds have you know within fabric we have wovens, denim, knits uh we have the vertically integrated piece around 29:18 29 minutes, 18 seconds garments. We have a,000 cr uh B toc,000 cr plus B2C business which is totally 29:28 29 minutes, 28 seconds domestic focused and the domestic market was very strong last year. We have um you know um um the advanced materials 29:37 29 minutes, 37 seconds business. So when something is hit disproportionately something else, you know hopefully is um making up the 29:46 29 minutes, 46 seconds slack. So having this diversified portfolio and the focus on efficiency, 29:53 29 minutes, 53 seconds responsiveness and productivity um I think have have seen the last year um have have been big success factors in 30:02 30 minutes, 2 seconds the in the performance we've delivered last year. And I feel this along with globalization of manufacturing footprint 30:12 30 minutes, 12 seconds should also be an advantage uh in you know the new uncertainties that we are seeing as we go into the new year. 30:21 30 minutes, 21 seconds Understood. Um or second question is on inflation input cost inflation that you've been highlighting that second 30:28 30 minutes, 28 seconds first half could have input cost inflation because and could impact margins. um you just have to understand 30:35 30 minutes, 35 seconds how how uh big that kit could be uh at this point in time. It can change uh 30:43 30 minutes, 43 seconds with time I understand but uh how garments uh advanced material fabrics are getting impacted and uh what should 30:51 30 minutes, 51 seconds we really uh expect in terms of impact going forward in first half? 31:00 31 minutes So um you know it's as you only mentioned it's rather early in the piece and a lot of the moves are still to be 31:08 31 minutes, 8 seconds made. Um so I so you know very difficult to give a very definite number but as of 31:16 31 minutes, 16 seconds now I can see easily 1 1.5% of EITA um coming off uh because of input costs in 31:23 31 minutes, 23 seconds in H1. Um volume growth will be very strong but margin may come off by 1 one 31:31 31 minutes, 31 seconds and a half%. Um if demand environment say stays strong we might have an opportunity to make up in um in in H2 31:40 31 minutes, 40 seconds but you know if the conflict keeps going on there is a chance that demand might not be very strong. So I think it's just 31:47 31 minutes, 47 seconds too much uncertainty to give a very def definitive answer. But rest assured the the team is equipped to to sort of uh 31:56 31 minutes, 56 seconds see these uh complexities through and and still deliver a uh uh a a decent uh decent uh performance. 32:06 32 minutes, 6 seconds So just to follow up on this, how is repeat appreciation that how can it help us? Um it it definitely helps. it will it will 32:15 32 minutes, 15 seconds partially offset many of these these uh these input costs. If rupee depreciation wasn't there then we'd be you know in a 32:24 32 minutes, 24 seconds in a very challenging environment because input costs have risen very sharply and are we getting price hike from uh 32:31 32 minutes, 31 seconds customers on existing contracts. So price hike is always you know u uh it's always difficult and it always takes 32:39 32 minutes, 39 seconds time because you know what you what you've just finalized you can't go back and revise. You'll you'll have to wait for the next order to get the price 32:48 32 minutes, 48 seconds hike. So there's always a lag effect and the price hike is never um uh never one 32:55 32 minutes, 55 seconds is to one. there is always you know uh somebody more desperate than you especially in fashion textiles where you 33:03 33 minutes, 3 seconds know there is a lot of capacity globally that has got created over the last 5 years so um you know price we are 33:12 33 minutes, 12 seconds getting price hikes but they take time and you know it's not one is to one um I 33:20 33 minutes, 20 seconds think volume growth our cost uh focus uh uh currency depreciation will all be 33:29 33 minutes, 29 seconds sort of used in concert uh to to try and mitigate the the impacts on on input 33:37 33 minutes, 37 seconds costs. So we have levers to pull. It's just a question of timing and um given 33:43 33 minutes, 43 seconds time we can we can recover um but then demand needs to be strong uh you know in 33:50 33 minutes, 50 seconds the second half. One more question increasing on debt. 33:55 33 minutes, 55 seconds Do you have anything to add on on input cost? 33:58 33 minutes, 58 seconds Yeah. So I think more than the input cost there was this discussion around whether you will do better or worse than 34:06 34 minutes, 6 seconds what you did in the last year first half. So I think the contextually as you 34:13 34 minutes, 13 seconds rightly said Kunit uh we we are seeing what we could have done and we are seeing a 11 one one and a half% going 34:21 34 minutes, 21 seconds down from there uh in terms of uh margin uh it may not be at percentage bad when 34:31 34 minutes, 31 seconds you compare it with the H1 of the last year. Well taken sir. So yeah that I understand sir. Um just last question on 34:40 34 minutes, 40 seconds debt. Uh given the acquisition uh the debt has almost doubled um on a consolidated basis. Uh how do you plan 34:48 34 minutes, 48 seconds to reduce it uh going forward and uh any timelines that you would like to give? 34:55 34 minutes, 55 seconds Yes. So Pa as we had spoken during the call a week ago on the acquisition we 35:02 35 minutes, 2 seconds are clear that uh we would like to bring down the debt back to where we were and 35:09 35 minutes, 9 seconds at a comfortable level just that the opportunity was so compelling that we had to finance uh immediately with the 35:19 35 minutes, 19 seconds debt. We are working on a plan that our philosophy as you know and we have been uh consistently following that we won't 35:27 35 minutes, 27 seconds bring down the debt over a few years. It may be uh maybe one or maybe two years and we are working on various 35:36 35 minutes, 36 seconds levers to try and bring it down. It's bit too early to say what we will do but maybe uh when we meet again in the first 35:46 35 minutes, 46 seconds quarter results or hopefully we will have a very clear idea as to how we are going to do 35:52 35 minutes, 52 seconds also the uh 50 million debt which is on the talo parent is completely nonreourse 36:00 36 minutes to India. So to that extent um you know the risk on the India balance sheet is is not um to the full extent of of the debt we've taken. 36:12 36 minutes, 12 seconds Understood. Thank you sir and best wishes for this upcoming challenging year again. Thank you. 36:21 36 minutes, 21 seconds Thank you. We will take the next question from the line of Vishal Ma from Capital. Please go ahead. 36:29 36 minutes, 29 seconds Yeah. Uh hey good morning uh and uh congratulations on continued strong set of numbers that you've been delivering. 36:37 36 minutes, 37 seconds Um my my first question uh sir would be on advanced material side. So we recorded uh you know around 19 odd% to 36:46 36 minutes, 46 seconds FYI 26 we continue to diet for 18 to 20 odd%. If you could give some color subsegment wise um uh you know what's 36:55 36 minutes, 55 seconds kind of driving this strong growth and uh you know your visibility what it is enhanced by 37:05 37 minutes, 5 seconds morning this is so as you would know we've got three uh key segments in our business uh human 37:14 37 minutes, 14 seconds protection uh composites and industrial uh with a very diversified portfolio meeting 37:22 37 minutes, 22 seconds several end use applications and solutions. 37:26 37 minutes, 26 seconds Uh we are seeing growth across all the three segments. 37:31 37 minutes, 31 seconds Uh there is not a particular segment which is growing faster than the other. 37:36 37 minutes, 36 seconds Uh when we look at human protection, it's also growing in high teens. 37:42 37 minutes, 42 seconds uh and a huge opportunity in uh in the coming year to expand and continue the growth through regional expansion into 37:51 37 minutes, 51 seconds some of the underrepresented geographies and also hunting for new customers is a big drive uh on the human protection 37:59 37 minutes, 59 seconds side and we are moving in that uh direction over the work uh done over the last 6 eight months. Innovation is also 38:07 38 minutes, 7 seconds a critical pillar uh uh where we have now developed new products for defense and other critical 38:16 38 minutes, 16 seconds applications uh to drive growth on the HP side. Uh in industrial which is predominantly our filtration business and where this acquisition also comes. 38:27 38 minutes, 27 seconds Um we have new investments that we made over the last year for uh more advanced 38:35 38 minutes, 35 seconds technologies for high temperature filtration applications and also have a significant capex expansion plan for 38:43 38 minutes, 43 seconds growth this year uh to again drive an 18 to 22% kind of a growth in industrial 38:50 38 minutes, 50 seconds composites is uh is again diverse from mobility to building and construction to renewables. 38:57 38 minutes, 57 seconds Uh we are seeing good demand on the renewable side which is uh the wind energy sector. building and construction 39:05 39 minutes, 5 seconds uh again is seeing very robust demand from Europe and the US market and in mobility where our presence uh with 39:14 39 minutes, 14 seconds Indian railways um is we've got now reasonably good outlook for the next 18 24 months an 39:22 39 minutes, 22 seconds order booked from our Indian uh railway customers. So overall uh pretty secular in nature across all the segments 39:32 39 minutes, 32 seconds um and your question on uh on margins um we did see a margin expansion in quarter 39:38 39 minutes, 38 seconds 4 um uh by about 200 basis point but as Punit said anywhere from 15 to 16% uh is 39:47 39 minutes, 47 seconds what we retain as an aspiration for the business. So overall driving an 18 20% revenue growth with an equitable 39:56 39 minutes, 56 seconds profitable beta growth is is clearly the objective. 40:01 40 minutes, 1 second Sure. Uh just a followup here on HP you said that you are increasing presence on underrepresented geographies. Uh would 40:08 40 minutes, 8 seconds it mean that we are also increasing our uh domestic uh defense uh uh uh you know kind of share here? 40:19 40 minutes, 19 seconds Yes. uh so uh defense is and and and it's a clear direction that we have to 40:28 40 minutes, 28 seconds uh support the India growth story and make it more self-reliant in all the sectors that we operate in um uh whether 40:36 40 minutes, 36 seconds it's um uh infrastructure build or filtration solutions for emissions uh in 40:43 40 minutes, 43 seconds the Indian market and also our defense services um that's a critical segment uh and we 40:51 40 minutes, 51 seconds have now not only expanded our footprint with the Indian army but also expanded to the other forces and paramilitary 40:59 40 minutes, 59 seconds forces. We have now going up the ladder to reduce and help the Indian forces to 41:06 41 minutes, 6 seconds reduce uh import dependence of certain high value and high solution products to enable indigenization 41:15 41 minutes, 15 seconds working with some of the core agencies uh uh in the Indian ecosystem and and conclusively coming to solutions uh for 41:24 41 minutes, 24 seconds the Indian forces. So defense clearly is a critical uh growth sector for us. 41:31 41 minutes, 31 seconds very helpful. Uh and as I said, Europe Europe on a geography point of view is uh is a critical geographic expansion where over 41:40 41 minutes, 40 seconds the last couple of months uh we've focused on the GTM uh the business development activity 41:48 41 minutes, 48 seconds uh and have a very good pipeline getting established uh to build a business in Europe over the next two years. And of 41:55 41 minutes, 55 seconds course as you would know the UK, EU FTAs are key enablers to support our our 42:02 42 minutes, 2 seconds investments and and strategic focus in these geographies. 42:08 42 minutes, 8 seconds Thanks. Thanks. Uh just on this Kuma I just wanted to get your sense on where we are in terms of implementation of these FOs. 42:18 42 minutes, 18 seconds We are pretty pretty advanced. So uh you know hopefully uh EU should should 42:26 42 minutes, 26 seconds happen any moment and we are expecting that uh sorry UK should happen any moment and should be towards the end of 42:35 42 minutes, 35 seconds the year is what the current consensus is and of course you know this is a 42:42 42 minutes, 42 seconds complex bureaucratic process. Um it is there's no doubt on on on whether it is 42:48 42 minutes, 48 seconds only when uh that is the the question and our our sources tell us that it this 42:56 42 minutes, 56 seconds would be the timeline that that we should see this happen and how are you seeing your responses from uh you know EU clients especially 43:05 43 minutes, 5 seconds EU UK clients currently uh on the text of course the challenge there is our government capacity 43:12 43 minutes, 12 seconds they will want to buy way more from us than we have capacity to offer. So in fact we have started an interesting you 43:21 43 minutes, 21 seconds know we are starting a studio in London um where where you know our entire collection will be available and we are 43:29 43 minutes, 29 seconds sort of tying up with lot of partner facilities. Um we have plenty of fabric capacity. We have a capacity constrained 43:37 43 minutes, 37 seconds environment in in garmenting because uh our existing customers also want to grow with us in garmenting. So they get first 43:46 43 minutes, 46 seconds preference and then when we have to offer capacities to new clients in in in these uh FDA geographies we are trying 43:55 43 minutes, 55 seconds to partner and and build virtual vertical supply chains. Um and that will be fueled by this new new studio that we're creating. 44:05 44 minutes, 5 seconds Okay. Uh just lastly, you know, we have uh on fabric side been operating at more than the rated capacity which we kind of 44:12 44 minutes, 12 seconds disclosed. Uh how are we managing to grow there and what's your growth outlook on the fabric side of business? 44:20 44 minutes, 20 seconds uh uh and how will we fulfill that you know given that we we operating at close this year we are expanding capacities in 44:28 44 minutes, 28 seconds fabrics too uh especially in knits where we are expanding capacity quite significantly we are almost doubling 44:36 44 minutes, 36 seconds um because that's the efficient way of I mean uh to to build capacity you can't build you know you can't have half a 44:44 44 minutes, 44 seconds line of production um and so uh nits will have significant capacity almost 60% more than than than what we are 44:54 44 minutes, 54 seconds having uh right now. Um in denim we are doing an asset light model lot of 45:01 45 minutes, 1 second debottlenecking capexes have been happening and are happening. So machine speeds go up um we add some finishing 45:08 45 minutes, 8 seconds technology we can buy undifferiated product from third parties and then then value add on it. So all those um you 45:16 45 minutes, 16 seconds know opportunities are there. We are adding printing capacity as well. So uh capacity will grow this time on fabric as well. 45:25 45 minutes, 25 seconds So 5 to 7% would be the growth to go move go forward with on external things. 45:30 45 minutes, 30 seconds Yes, I think that's a good good number to keep in mind. 45:34 45 minutes, 34 seconds Thank you. Thanks a lot and all the best. Thank you. 45:40 45 minutes, 40 seconds Thank you. We will take the next question from the line of Surya Narayan Nayak from Sunidi Securities. Please go ahead. 45:54 45 minutes, 54 seconds Mr. Surya, please proceed with the question. 46:01 46 minutes, 1 second Did you know response? We will take the next participant. 46:05 46 minutes, 5 seconds We have the next question from the line of Hash Dubet from LFC Securities. Please go ahead. 46:12 46 minutes, 12 seconds Hi, good morning sir and congratulations for good set of numbers. Uh I just have uh questions on the government as you 46:19 46 minutes, 19 seconds say as you have rightly pointed out that the capacity is the constraint in India and we are having the EU and the UK FDA 46:26 46 minutes, 26 seconds and lot of clients are looking towards the sourcing and d-risking from Bangladesh right uh what I wanted to understand is when you talk about the 46:35 46 minutes, 35 seconds partnership factory uh uh what's the timeline that you're expecting in this and just wanted to also understand the 46:43 46 minutes, 43 seconds timeline for our internal capacity and government shipping numbers going forward. 46:49 46 minutes, 49 seconds So government shipping numbers will go from you know low 40 million to above 50 46:56 46 minutes, 56 seconds million. So we should add more than 10 million um you know full garments um uh 47:03 47 minutes, 3 seconds this this year. We should also grow significantly in our essentials business. Um you know which is that will 47:10 47 minutes, 10 seconds also grow by 20% this year. Uh which is another 35 million. Of course it's undergarment so much smaller in value. 47:20 47 minutes, 20 seconds Um but that should also cross 40 million this year. Um so capacity addition in our own governmenting is very very strong. Um which is a ongoing process. 47:32 47 minutes, 32 seconds every year we've been investing behind and then partner facilities we already partner with quite a few you know 47:40 47 minutes, 40 seconds strategic vendors some of which we've been working for decades so we will dial up our engagement with these people and 47:48 47 minutes, 48 seconds maybe add one or two more relationships like that to be able to cater to the additional demand um once these FDAs are 47:55 47 minutes, 55 seconds in force perfect on this s uh as as you rightly said that right now we are also 48:02 48 minutes, 2 seconds partnering with our uh you know other capac like other other players. So I just wanted to understand this is specifically only in India and when we 48:11 48 minutes, 11 seconds talk about the uh so when we talk about the diversification are we also looking at geographical diversification might be 48:18 48 minutes, 18 seconds partnering up with partnership factories in Bangladesh Vietnam or something like that. So we already have strong 48:25 48 minutes, 25 seconds partnerships in both um uh Egypt uh Sri Lanka and Bangladesh. Uh these are 48:32 48 minutes, 32 seconds historic um um partnerships. We are adding one new partnership in in 48:39 48 minutes, 39 seconds Bangladesh. Uh and we are adding a new partnership in Egypt. Um so advanced materials uh we have leased a factory 48:48 48 minutes, 48 seconds and that's that's working quite well in Egypt already you know three four cycles of orders have have been dispatched from 48:56 48 minutes, 56 seconds there um and we are adding for fashion textiles particularly denim um some 49:02 49 minutes, 2 seconds partnership factories in Egypt on this when we say that we as we are an 49:10 49 minutes, 10 seconds integrated player and I rightly understand that uh we are also having partner partnership factories in Bangladesh. Uh just on this when we talk 49:17 49 minutes, 17 seconds about government specifically do we think that we are going to have our own facilities as well in Bangladesh going f 49:24 49 minutes, 24 seconds going in the future uh because uh after this FDA is uh done I think so still the cost effectiveness of Bangladesh because 49:32 49 minutes, 32 seconds of operating cost still Indian Indian textile will be 5 to 7% higher FOB so uh what do you think about that are we 49:41 49 minutes, 41 seconds thinking of adding new facilities in Bangladesh but like internally not not with partnerships. 49:47 49 minutes, 47 seconds So we want to go with an asset light approach. Invent light approach. 49:52 49 minutes, 52 seconds Sorry to interrupt in between. So h I would request you to kindly self-ut when management is answering. 49:59 49 minutes, 59 seconds Sure. 50:03 50 minutes, 3 seconds Um yeah so the um we are we are trying to go in with an asset light or investment light model where we invest 50:12 50 minutes, 12 seconds but invest in very strategically bottlenecking assets or uh capability enhancement or 50:20 50 minutes, 20 seconds quality control equipment. Uh we invest we are investing in people. So that's the form of our investment. Um and 50:30 50 minutes, 30 seconds should should should that succeed then we can think of you know in dialing up investment um as we go forward. Uh if it 50:39 50 minutes, 39 seconds works well with an investment light approach we can just do more of it right. So I think in a sense the next 18 50:46 50 minutes, 46 seconds months will teach us a lot as to you know what final mode or form should this 50:53 50 minutes, 53 seconds uh partnership approach take. Um and we will evolve as we as we keep learning but we are quite excited by the 51:00 51 minutes opportunities we are finding you know good meeting of the minds with many people um whom we can come together and 51:09 51 minutes, 9 seconds with and grow our business. Um so um you know managing risk uh by being 51:17 51 minutes, 17 seconds investment light is also an important criteria uh going forward because you know not all geographies are easy to 51:26 51 minutes, 26 seconds operate in with owned assets and we have other people's uh capabilities to to manage those environments. 51:38 51 minutes, 38 seconds Uh just a question on this s when we when we say that our capacity is so just a clarification on capacity of government and the shipping number. So 51:47 51 minutes, 47 seconds we we are saying that by end of FY27 we should have approximately 60 million the capacity and 50 million 51:54 51 minutes, 54 seconds of shipping is what you're saying? No, no. So, end of 27, our capacities, we 52:00 52 minutes should be in the mid50 million range in terms of our um our uh manufacturing 52:08 52 minutes, 8 seconds capability. By the end of the year, the capacity should reach 60 million. 52:13 52 minutes, 13 seconds Okay. Okay. So, you're saying that it's going to be 55 to 60 and then then we are going to have the shipping numbers that's going to be above 50. So, okay. 52:22 52 minutes, 22 seconds Got perfect. Thank you so much, sir. All the best for your future endeavors. You're doing great. Thank you. 52:31 52 minutes, 31 seconds Thank you. We will take the next question from the line of Harsh Mittal from MK Global Financial Services. Please go ahead. 52:40 52 minutes, 40 seconds Yeah, thank you for the opportunity. Uh so just continuing with the previous participants question. Uh do we see any upside risk uh in the uh human 52:48 52 minutes, 48 seconds protection segment in growth numbers? uh given that wastation crisis is there, countries are ramping up their defense 52:55 52 minutes, 55 seconds budget and we have the EU and the UK FDA is in place. So this kind of balances out if there there are any downside risk 53:04 53 minutes, 4 seconds downside growth risk in the governments or the textile divisions. This my first question sir. 53:10 53 minutes, 10 seconds So I think the demand environment in human protection is good. Um um there is also a capacity ramp up that that is 53:18 53 minutes, 18 seconds there um ongoing. So you can't you know really do much more beyond capacity. So I think we will be at full capacity. 53:29 53 minutes, 29 seconds There's an efficiency unlock piece also. 53:32 53 minutes, 32 seconds Um uh there is uh you know um um that will enhance capacity. So whatever 53:39 53 minutes, 39 seconds opportunity we get to dial up um you know our capacity utilization um we will 53:46 53 minutes, 46 seconds ensure that we take it. Um and you're right uh in in in pointing out that you 53:54 53 minutes, 54 seconds know all advanced material sales are not as discretionary as you know fashion textiles is. So to that extent there we 54:02 54 minutes, 2 seconds have you know buffers against demand destruction um that are relatively 54:09 54 minutes, 9 seconds um you know stronger compared to um you know fashion textiles. So we we we do 54:17 54 minutes, 17 seconds expect the demand for this to be more robust compared to uh even in the face of inflationary environment and 54:24 54 minutes, 24 seconds especially since defense and and um and conflict is going up in the world um 54:31 54 minutes, 31 seconds Europe needs to indigenize its defense um the Middle East is procuring more so 54:38 54 minutes, 38 seconds um yes demand environment I don't expect in human protection to be weak 54:45 54 minutes, 45 seconds Just to add that demand realization into revenue and human protection takes some time because 54:55 54 minutes, 55 seconds of the whole certification and validation process. So while we may see an upsurge of global demand on defense 55:03 55 minutes, 3 seconds for us to realize that would take a couple of months um to go through that process. 55:11 55 minutes, 11 seconds So my second question uh around the margin you alluded to that uh in the first half there may be some 100 to 150 55:19 55 minutes, 19 seconds digits shave off in the first half. Uh is uh a network of the cost efficiency measures that do we take or uh it is uh 55:28 55 minutes, 28 seconds or we have some efficiency measures which kind of uh negates this uh hike in the costs. 55:38 55 minutes, 38 seconds Sorry come again. I couldn't quite understand that. 55:42 55 minutes, 42 seconds So, so you alluded to uh the thing on margins dilution of around 100 basis points in the first half. So, is this a 55:50 55 minutes, 50 seconds network after you taking the efficiencies cost efficiency measures which already you are working on or uh 55:57 55 minutes, 57 seconds there are any other uh there are some efficiencies measures which kind of buffers this or negates this uh uh 100 basis points uh cost inflation. 56:09 56 minutes, 9 seconds So I'm I'm taking 100 basis points from what it could have been um and what what 56:19 56 minutes, 19 seconds the current trajectory was when we locked in the orders basically. So compared to that it shouldn't be 1% from last year's numbers. 56:30 56 minutes, 30 seconds Okay. So my last question is on the capex uh uh the 500 crex uh mentioned earlier in the call. Does it include the 56:39 56 minutes, 39 seconds Dalco capex as well or is it X of Dalco? This is the ongoing capex that we 56:45 56 minutes, 45 seconds are doing in in the nondalco part of the business. Dalco is over and above that. 56:53 56 minutes, 53 seconds So that we believe should be around 50 crores in Dalco and which makes a total of 550 crores something like that. Maybe little less, 57:02 57 minutes, 2 seconds little more depending on the environment and opportunity set we we can you know sort of ratchet that up or down. 57:11 57 minutes, 11 seconds Sure. Thank you. These were my questions. Thank you. Thank you. 57:19 57 minutes, 19 seconds We will take the next question from the line of Bimmel Sut and individual investor. Please go ahead. 57:25 57 minutes, 25 seconds Yeah. Good morning. Uh two questions. 57:29 57 minutes, 29 seconds One is in advanced material. We also had a tie up with a Japanese company for carbon fiber. Can you throw some more 57:38 57 minutes, 38 seconds light on that? And uh second one is on our sustainable you know measures like 57:45 57 minutes, 45 seconds renewable energy we have shifted we are shifting to that and recycling of garments which I think has a very bright 57:54 57 minutes, 54 seconds future coming I mean in the coming years. 57:57 57 minutes, 57 seconds Japanese joint venture is not in um in uh carbon fiber. It is in this needle punch 58:05 58 minutes, 5 seconds non-woing nonwoven space for filtration materials. We make the roll good filtration for um for hot gas fil um 58:14 58 minutes, 14 seconds roll goods for hot gas filtration with the Japanese joint venture. Um and textile to textile recycling is a big theme. We are participating in that 58:23 58 minutes, 23 seconds theme. We already have a good product range there and that's only going to go up going going forward 58:31 58 minutes, 31 seconds and uh this uh renewable energy you know we had tied up for some brickets and then one solar venture was there. Can 58:40 58 minutes, 40 seconds you Yes. So there wind solar hybrid um venture as of now 58:47 58 minutes, 47 seconds um uh if if there are no surprises it should come at the end of Q2. 58:52 58 minutes, 52 seconds Okay. And uh this uh brackets we are doing something that also that also um should come 59:00 59 minutes towards the end of Q2. Um it's a new experimental technology. So fingers crossed that it'll work. If it'll work 59:08 59 minutes, 8 seconds then it'll dramatically speed up our decarbonization journey. It's with it's a partnership with peak ventures for a 59:16 59 minutes, 16 seconds technology called torifaction and we will reach 80% renewable uh electricity with this last PPA that we 59:24 59 minutes, 24 seconds are signing which will come hopefully end of Q2. Okay. Thank you. Thank you. 59:33 59 minutes, 33 seconds Thank you. We will take the next question from the line of Surya Narayan Nayak from Sunidi Securities. Please go ahead. 59:41 59 minutes, 41 seconds Yeah. Am I already going? Yeah. 59:43 59 minutes, 43 seconds Yes, you're okay. Yeah. Yeah. Thank you very for giving me opportunity and congrats for congrats for the good set of numbers in 59:51 59 minutes, 51 seconds it turbulent period. So just to understand uh the current government bicycles and we are operating in 59:59 59 minutes, 59 seconds considering the expansions in the R&D on the way. So what kind of uh scope for 1:00:06 1 hour, 6 seconds you are we are caring uh for a long-term vision of 30 2030 uh because you know we 1:00:13 1 hour, 13 seconds are not expanding uh you know majorly in the know fabrics and we are trying to uh verticalize more and that will that 1:00:21 1 hour, 21 seconds could be uh increasing our margins. So what what uh run rate we are currently on and what what is our expectation? 1:00:30 1 hour, 30 seconds No. So I think medium-term plan is you know even with this 60 million we are 300 million meters of fabric and 60 1:00:38 1 hour, 38 seconds million garments is still a very small percentage. So there is lot of opportunity to grow garmenting and we 1:00:45 1 hour, 45 seconds are not saying we won't grow fabrics. We will grow fabrics slower. Um and this 1:00:52 1 hour, 52 seconds year is case in point where we've seen the need uh to grow nits because our verticality has crossed um 50 55% 1:01:02 1 hour, 1 minute, 2 seconds in in in knits. So to keep all our customers serviced and then to you know 1:01:09 1 hour, 1 minute, 9 seconds sort of prepare for uh EU and UK business we have chosen to also expand our fabrics there. So, so we will take 1:01:18 1 hour, 1 minute, 18 seconds such decisions when it is strategically right for us to do that. But the percentage of verticalization should keep going up and hopefully by 2030 we reach 30 35% verticalization. 1:01:29 1 hour, 1 minute, 29 seconds Um and and then you know some more virtual verticals as well so that we we're not 1:01:37 1 hour, 1 minute, 37 seconds very dependent on fabric nomination based business which is which is a risk you know. 1:01:43 1 hour, 1 minute, 43 seconds Okay. And and secondly uh there is a lot of opportunities are coming from the 1:01:50 1 hour, 1 minute, 50 seconds European side. There is a mandate from the European uh you know textile association to have uh the textile to 1:01:58 1 hour, 1 minute, 58 seconds textile recycling. So are we uh doing anything currently uh in the chem in the 1:02:06 1 hour, 2 minutes, 6 seconds chemical side of uh pro processes or any other processes we are actually indulging in? We are doing all three. We 1:02:14 1 hour, 2 minutes, 14 seconds are doing mechanical, we are doing chemical and we are doing hybrid also. 1:02:19 1 hour, 2 minutes, 19 seconds So we have we have a constellation of partners that we work with um that that 1:02:27 1 hour, 2 minutes, 27 seconds have several technologies for different types of polymers and for cellulose as well. So we we are quite active in this 1:02:36 1 hour, 2 minutes, 36 seconds space and we are working with a lot of these innovators to be the first point of um you know sort of piloting doing 1:02:44 1 hour, 2 minutes, 44 seconds capsule collections proving the concept giving them feedback on the fiber. So we are quite active here. 1:02:52 1 hour, 2 minutes, 52 seconds So currently are we uh uh investing anything have you invested anything in the uh textile to textile area 1:03:00 1 hour, 3 minutes recycling? So we have you know we have created one uh joint venture with with purify which which is still not 1:03:08 1 hour, 3 minutes, 8 seconds operational in India for variety of reasons. Um but um uh beyond that also 1:03:15 1 hour, 3 minutes, 15 seconds we work with a lot of um innovators on a uh buy and sell um you know sort of 1:03:23 1 hour, 3 minutes, 23 seconds basis. So our work actually starts where their work ends right. So they are an input into uh you know our 1:03:31 1 hour, 3 minutes, 31 seconds manufacturing. So it doesn't it it really unless there is something that we 1:03:37 1 hour, 3 minutes, 37 seconds can value add um we would much rather like to you know work with multiple 1:03:43 1 hour, 3 minutes, 43 seconds people and buy their their um you know product. 1:03:52 1 hour, 3 minutes, 52 seconds I mean mostly it is a preconumer side you are focusing as of now uh we are also looking at postconumer. 1:04:01 1 hour, 4 minutes, 1 second Okay. Okay. So is there any timeline you have said to uh scale up that joint venture uh into a scale because you know 1:04:11 1 hour, 4 minutes, 11 seconds globally uh some of the companies uh in the European side they are actually developing capacity with you know nearly 1:04:17 1 hour, 4 minutes, 17 seconds 1 million t. So like that know where I mean the demand is coming from the brands to have more uh recycled fiber uh 1:04:26 1 hour, 4 minutes, 26 seconds to be uh in their stream. So is it the opportunity we are also seeking or uh we are 1:04:34 1 hour, 4 minutes, 34 seconds we will look to partner with this kind of uh you know ecosystem rather than it's not our core business to be uh 1:04:42 1 hour, 4 minutes, 42 seconds producing you know um fiber um so so we will we will only we will evaluate all 1:04:51 1 hour, 4 minutes, 51 seconds options but we will you know my first response is we would like to partner with this ecosystem and be an early adopter for all these technologies. 1:05:01 1 hour, 5 minutes, 1 second Okay. Okay. And lastly uh recently there was some labor unrest happened in the 1:05:07 1 hour, 5 minutes, 7 seconds NOA site. So uh and the UP government has set some higher target a higher 1:05:14 1 hour, 5 minutes, 14 seconds price for the labors. So are we also uh revising anything on the baroni side plant? 1:05:23 1 hour, 5 minutes, 23 seconds No, we will comply with all the labor regulations. So we we operate in multiple states. So um we comply uh you 1:05:31 1 hour, 5 minutes, 31 seconds know uh we go above and beyond compliance with with uh labor norms and 1:05:38 1 hour, 5 minutes, 38 seconds and and and uh good employment practice uh practices. So um we don't see any challenge. 1:05:46 1 hour, 5 minutes, 46 seconds So in that case uh the wage inflations are to be accounted for the R&D going forward. So that we do every year in our 1:05:55 1 hour, 5 minutes, 55 seconds budgeting that you know it is a fact in India that that India is uh uh you know 1:06:02 1 hour, 6 minutes, 2 seconds going to be a high cost inflation country high wage inflation country. So that's built into our model. 1:06:11 1 hour, 6 minutes, 11 seconds Okay. Thank you. Thank you. 1:06:16 1 hour, 6 minutes, 16 seconds Thank you. The next question is from the line of Rajat Ba from Kizuna wealth. Please go ahead. 1:06:24 1 hour, 6 minutes, 24 seconds Yeah. Hi sir, thanks for giving me the opportunity and congratulation and good set of numbers. My first question is on the outlook on the export trajectory of 1:06:32 1 hour, 6 minutes, 32 seconds the AMD given that the export currently around 60 65% of AMD revenue and in particular do you expect this portion to 1:06:41 1 hour, 6 minutes, 41 seconds rise? This is my first question. Yeah, the advanced materials business which is now called a AML. Um we are pretty we 1:06:50 1 hour, 6 minutes, 50 seconds are pretty happy with u you know the current uh domestic to export uh you 1:06:57 1 hour, 6 minutes, 57 seconds know ratio um and it'll kind of remain constant there because India for us is also growing and India is a very 1:07:04 1 hour, 7 minutes, 4 seconds important market where where we would like to continue to operate at uh with deep penetration. In fact, it had the 1:07:13 1 hour, 7 minutes, 13 seconds largest right to win for us is our home market. So, uh we don't want to 1:07:19 1 hour, 7 minutes, 19 seconds underserve it. So, I think 60 65% export for the moment is the right right export figure. The rest will be in India. 1:07:30 1 hour, 7 minutes, 30 seconds Okay. And sir, how much is from the US? 1:07:36 1 hour, 7 minutes, 36 seconds Um US would be about between 35 and 40%. 1:07:43 1 hour, 7 minutes, 43 seconds Okay. And so my second question on the human protection segment, right? Could you please give a bipation like what 1:07:52 1 hour, 7 minutes, 52 seconds percentage of order or the revenue come from defense versus industrial safety given that India defense indigenization push? 1:08:01 1 hour, 8 minutes, 1 second So defense currently contributes to about uh 15% of our human protection business. 1:08:09 1 hour, 8 minutes, 9 seconds And as I shared uh there are several programs to diversify through the forces 1:08:17 1 hour, 8 minutes, 17 seconds uh and also paramilitary forces and I see this anywhere within human protection uh but if you look at the 1:08:24 1 hour, 8 minutes, 24 seconds total advanced materials business it'll be about 8 to 10%. 1:08:30 1 hour, 8 minutes, 30 seconds Okay just one last question keep of bookkeeping patient a recent disclosure indicate the pledge of securities with 1:08:37 1 hour, 8 minutes, 37 seconds barrage women in addition the existing promoter is around 78% will elaborate or provide the rational behind this 1:08:45 1 hour, 8 minutes, 45 seconds incremental pledging and offer clarity on the broader PL there is no can I can I answer 1:08:54 1 hour, 8 minutes, 54 seconds yes sir yes sir yeah so there is no extra place by the promoters that has been done. Uh in fact 1:09:02 1 hour, 9 minutes, 2 seconds uh place levels over last two years have been brought down. So I'm not sure uh what data uh we can I can check and talk 1:09:12 1 hour, 9 minutes, 12 seconds to you separately but we are very uh clear that there has not been any extra place. Maybe it has shifted from one to 1:09:19 1 hour, 9 minutes, 19 seconds another uh but there is no extra place that the promoter should. 1:09:26 1 hour, 9 minutes, 26 seconds Okay. Great sir. Thank you. Thank you. 1:09:33 1 hour, 9 minutes, 33 seconds Thank you very much ladies and gentlemen. We will take that as the last question for today. And with that concludes the question and answer 1:09:41 1 hour, 9 minutes, 41 seconds session. I now hand the conference over to Mr. Satya Picash for closing comments. Thank you and over to you sir. 1:09:49 1 hour, 9 minutes, 49 seconds Uh once again thank you everyone for joining today's call. We trust that the discussion has addressed most of your 1:09:56 1 hour, 9 minutes, 56 seconds questions. uh should anything remain unanswered or if any queries arise going forward, please do not hesitate to reach 1:10:04 1 hour, 10 minutes, 4 seconds out to me and my colleague Himantu. We are just a phone call or an email away. 1:10:09 1 hour, 10 minutes, 9 seconds Uh looking forward to engaging with you in upcoming events of the company. Thank you and wish you a good day ahead. 1:10:18 1 hour, 10 minutes, 18 seconds Thank you members of the management. On behalf of Arvin Limited, we conclude this conference. Thank you all for joining us. And you may not disconnect your lights.