Divgi TorqTransfer Systems Ltd — Q3 FY26

Divgi TorqTransfer Systems Ltd Q3 FY2025-26 Earnings Conference Call https://www.youtube.com/watch?v=66dltBTwvsI Published: 3 months ago

0:00 Ladies and gentlemen, kay and welcome to the DVD talk transfer systems limited Q3 and 9 months FI 2026 earnings conference call hosted by Sentrum Broking Limited. 0:13 13 seconds As a reminder, all participant lines will be in the listenon mode and there will be an opportunity for you to ask questions after the presentation 0:21 21 seconds concludes. Should you need assistance during the conference call, please signal an operator by pressing star then zero on your touchstone phone. 0:29 29 seconds I now hand the conference over to Mr. 0:31 31 seconds Rameinda Mija from Sentrum Broking Limited. Thank you and over to you. Thank you. Uh good afternoon everyone. 0:40 40 seconds On behalf of Syndrome Broking Limited, I welcome you all to Q3 FY26 post results call of DGI talk transfer systems 0:47 47 seconds limited. From the management side we have Mr. Jitinda Dibi, managing director, Mr. Hindi, whole time director, Mr. Sudit Mirjanka, CFO, Mr. 0:57 57 seconds Satuendra Singh Sabaral, Chief Guroth Officer and Mr. Deepakwani, COO. I will now hand over the call to Jetendra Dasa for his opening remarks. Over to you sir. 1:07 1 minute, 7 seconds Yes. Um this is Jiten Divi here and uh a very warm welcome uh uh to all members of our investor community. 1:18 1 minute, 18 seconds Welcome to this uh Q3 FI26 uh earnings call of your company. Uh I'm sure you've had the opportunity to go through our uh 1:27 1 minute, 27 seconds Q3 FI26 results which were uploaded on the stock exchanges and are also now 1:33 1 minute, 33 seconds available on our company website. As was mentioned uh I am accompanied today uh 1:39 1 minute, 39 seconds by my colleagues uh my brother Hireendra Divi whole time executive director Sudir 1:46 1 minute, 46 seconds Mirjankar uh chief financial officer Satinder Singh Sabarwal our chief growth officer and Deepakwani our chief 1:54 1 minute, 54 seconds operating officer uh our investor relations advisers SGA are also available. 2:01 2 minutes, 1 second Uh at the outset uh I wish to make an important announcement uh and very pleased to share an important strategic 2:11 2 minutes, 11 seconds development for our business. Uh we have received order confirmations from uh two of our key OEM customers, Mahindra and 2:19 2 minutes, 19 seconds Mandra and Tata Motors for their respective pickup vehicle program uh uh 2:25 2 minutes, 25 seconds for the Indonesian uh market which uh as many of you may be aware is a member of the larger ASEAN uh economic grouping. 2:36 2 minutes, 36 seconds Under these programs, Mindra and Mindra and Tata will be ex each exporting uh 2:42 2 minutes, 42 seconds 35,000 units uh of their uh pickup trucks uh which is the Scorpio pickup 2:49 2 minutes, 49 seconds for Mahindra and uh uh the Yodha uh from Tatana Motors. Um and this uh production 2:57 2 minutes, 57 seconds is expected to commence in calendar 26 uh but most of it will happen in FI 27. 3:06 3 minutes, 6 seconds Under this exclusive arrangement that we have with both customers, we will act as the sole supplier of transfer case 3:12 3 minutes, 12 seconds systems uh and other allied products that go with these to both OEMs. 3:19 3 minutes, 19 seconds This order represents uh a significant milestone uh in our strategy to support Indian OEMs in their global expansion 3:27 3 minutes, 27 seconds journey and vindicates uh the kind of faith we had shown in the export capability uh of the products of our Indian OEMs. 3:40 3 minutes, 40 seconds uh it also provides strong medium-term volume visibility uh for our transfer case business and further reinforces the 3:47 3 minutes, 47 seconds segments strategic importance within our overall uh product uh portfolio. 3:55 3 minutes, 55 seconds So coming to uh the Q3 SI 26 performance, it marks uh yet another important milestone for for our company 4:03 4 minutes, 3 seconds as we delivered our highest ever quarterly total income. We have surpassed our previous best performance 4:10 4 minutes, 10 seconds which was registered in Q2 FI26 which itself was a record quarter for the company. This clearly reflects the 4:19 4 minutes, 19 seconds consistency, momentum and execution strength we have built over the last couple of years through a combination of 4:28 4 minutes, 28 seconds uh investment to modernize our capability and the capability of our people through continuous training and education. 4:37 4 minutes, 37 seconds This performance has been driven by steady execution across our core businesses uh and increasing traction across multiple growth drivers. Our 4:47 4 minutes, 47 seconds quarterly revenue run rate is now approaching the range of 90 to 100 crores signaling that the company is 4:54 4 minutes, 54 seconds entering a very exciting phase of growth. 4:58 4 minutes, 58 seconds uh on a cumulative basis our performance for the first 9 months of FI26 has been particularly encouraging during this 5:06 5 minutes, 6 seconds period uh we surpassed the fullear income levels of both FI 24 and 25 and 5:13 5 minutes, 13 seconds we are close to reaching FI23 levels one of the strongest and most historic years of our company uh given this sustained 5:21 5 minutes, 21 seconds momentum we believe it is realistic now to say that we will achieve our long-term growth aspiration of 5:28 5 minutes, 28 seconds delivering 12 to 15% CAGGR over 5 years with FI20 as our base year that was the 5:35 5 minutes, 35 seconds base year that was mentioned uh in our uh IPO prospectus. Uh this confidence we have is supported by sustainable 5:44 5 minutes, 44 seconds business strategies and execution capabilities we have been building consistently over the years. 5:52 5 minutes, 52 seconds to give you uh some more color on on this. Based on the business pipeline currently under execution, the 6:00 6 minutes visibility in our order book and the scale of uh work underway across our verticals, we believe the company is 6:08 6 minutes, 8 seconds well positioned to regain uh its lost ground across both domestic and export markets. Uh and I will amplify on on 6:17 6 minutes, 17 seconds some of these details as we go along. uh this is further supported by improving demand conditions and the convergence of 6:25 6 minutes, 25 seconds multiple growth drivers uh across our business. 6:29 6 minutes, 29 seconds FI 24 and 25 were relatively slower years for the company impacted by broader macroeconomic headwinds as well 6:37 6 minutes, 37 seconds as certain challenges faced by some of our key OEM customers. During this period, our focus remained firmly on 6:45 6 minutes, 45 seconds protecting the core of our business, strengthening long-term 6:49 6 minutes, 49 seconds [clears throat] 6:49 6 minutes, 49 seconds customer relationships and continuing to invest in capabilities uh that would support sustainable growth over the long 6:57 6 minutes, 57 seconds term. As you may have noted, even in those lean years, we managed to maintain uh our EBIDA levels well over 20%. 7:07 7 minutes, 7 seconds We have consistently followed a philosophy of building capacities and capabilities slightly ahead of the curve. This is not driven by immediate 7:15 7 minutes, 15 seconds order visibility but by our conviction that having the right infrastructure and scale in place enables us to attract 7:23 7 minutes, 23 seconds large automoil OEMs and participate in long-term high value programs. This approach has worked well for us and 7:31 7 minutes, 31 seconds continues to be uh a key uh differentiator. Um my sense is that one 7:37 7 minutes, 37 seconds of the uh sort of mantras of resilience is the fungeibility of our uh soft 7:45 7 minutes, 45 seconds capability and hard capability of our investments across the four verticals that uh we are building. And those 7:52 7 minutes, 52 seconds verticals I might remind you are manual transmissions and components, four-wheel drive systems, EV transmissions and automatic transmissions. 8:02 8 minutes, 2 seconds Over the last four quarters, starting from Q4 FI25, we have witnessed a clear recovery in our business. This this 8:11 8 minutes, 11 seconds improvement has been driven not only by a gradual normalization of external conditions, but also by focused 8:18 8 minutes, 18 seconds execution initiatives that have been reaching their culmination and that were aimed at sustaining performance. Um 8:26 8 minutes, 26 seconds these include supporting our OEM customers in their global expansion drive uh strengthening our own global footprint and then consistently 8:35 8 minutes, 35 seconds delivering uh in you know on time to our uh customers at the same time deepening our 8:42 8 minutes, 42 seconds engagement with our OEM partners through long-term highv value programs and I will provide some more clarification on 8:50 8 minutes, 50 seconds this as we go along. The improvement we are now seeing in our 9-month performance reflects the alignment of these initiatives along with the 8:58 8 minutes, 58 seconds activation of multiple growth engines across the business. Our approach of building capacities and capabilities 9:05 9 minutes, 5 seconds well ahead of demand gives us strong confidence uh and equally provides comfort [clears throat] to our customers as as it reflects a clear long-term 9:14 9 minutes, 14 seconds vision and commitment to growth. Uh once again to put things into perspective uh I'd like to highlight uh two key 9:22 9 minutes, 22 seconds developments. First we have worked very closely with our two major OEM customers 9:28 9 minutes, 28 seconds data and Mahindra and supported by our strong technical and engineering capabilities. These OEMs have secured 9:36 9 minutes, 36 seconds now significant export orders uh in a critical market like Indonesia. It's critical because historically Indonesia 9:45 9 minutes, 45 seconds has been sort of the preserve of uh very strong Japanese OEMs like Toyota, Nissan 9:51 9 minutes, 51 seconds and Isuzu. Uh this program uh uh these programs are also drawing on our allied 10:00 10 minutes products like synchronizer systems and automatic locking hubs for front axles. 10:05 10 minutes, 5 seconds Uh they also include at Tata Motors our value engineered manual shift transfer case on the Yodha and it further 10:13 10 minutes, 13 seconds reinforces our ability to support customers in winning uh international business. Second and more importantly uh 10:21 10 minutes, 21 seconds I'd like to revisit a development we had announced last quarter uh regarding our long-standing focus on taking our legacy 10:29 10 minutes, 29 seconds transfer case business to global platforms. This engagement is with a leading Japanese OEM and because of uh 10:37 10 minutes, 37 seconds confidentiality agreements I'm not at liberty to reveal the name but this is a global market leader particularly in 10:45 10 minutes, 45 seconds Southeast Asia and we are developing a transfer case for one of their iconic pickup truck platforms with SOP expected to begin in the first half of FI28. 10:58 10 minutes, 58 seconds I'm really thrilled to share with you that uh initial prototypes are ready and a proof of concept has been successfully developed and demonstrated in a vehicle. 11:10 11 minutes, 10 seconds This marks uh a historic milestone as it is among I think the first instance in India where such a sophisticated 11:19 11 minutes, 19 seconds electronically controlled driveline aggregate has been conceived, designed and developed using proprietary Indian 11:28 11 minutes, 28 seconds technology and innovation. This represents yet another uh milestone for us driven by our in-house uh conceptual 11:37 11 minutes, 37 seconds strengths, design, engineering and manufacturing capabilities seamlessly integrated into the OEM's proprietary electronics and software architecture. 11:48 11 minutes, 48 seconds Additionally, to further strengthen this relationship, we have an exclusive distribution agreement with Toyota Susho 11:56 11 minutes, 56 seconds India Private Limited, a member of the Toyota Susho group, which in turn is a member of the 17 companies that make up 12:04 12 minutes, 4 seconds the Toyota group globally. and Toyota Susho is helping us distribute, sell and distribute our talk management and 12:12 12 minutes, 12 seconds transmission solutions and products to the universe of Japanese companies worldwide. 12:19 12 minutes, 19 seconds To conclude, I would only say this, watch this space closely. We believe there are many more exciting developments ahead and we look forward 12:27 12 minutes, 27 seconds to sharing them with you in due course of time. 12:31 12 minutes, 31 seconds Uh turning to our transfer case business, this segment continues to be one of our core strengths and has delivered strong performance during the 12:39 12 minutes, 39 seconds year supported by both val and volume growth. Volumes have shown steady improvement and are now approaching FI23 12:46 12 minutes, 46 seconds levels reflecting a recovery in demand as well as increasing adoption of four-wheel drive configuration 12:53 12 minutes, 53 seconds configurations across key vehicle platforms. This volume recovery combined with disciplined execution has supported 13:02 13 minutes, 2 seconds healthy value realization in the business. Uh a couple of few uh highlights that I wish uh highlights I 13:11 13 minutes, 11 seconds wish to share with you. Um you know as I just mentioned uh a 13:18 13 minutes, 18 seconds shortterm key driver is the orders that have come in from Indonesia for pickup trucks uh at Tata and Mahindra. Uh but 13:28 13 minutes, 28 seconds in addition uh at these OEMs we are working on prototypes uh for three for three different types of transfer case technologies. 13:38 13 minutes, 38 seconds Uh these include an open differential manual shift transfer case with a 13:45 13 minutes, 45 seconds central differential locking mechanism as well as talk on demand transfer cases with mechanical locking with a 13:52 13 minutes, 52 seconds mechanical locking feature. Uh I know this is I'm I'm throwing some technical jargon here but it's important that we 14:01 14 minutes, 1 second uh mention this clarity and I'm I'll be happy to answer any questions at the end of this session. Uh the interesting 14:09 14 minutes, 9 seconds thing is all these uh concepts have been demonstrated on vehicles. 14:15 14 minutes, 15 seconds uh these product these products uh target fast-selling platforms and upon success successful completion of testing 14:24 14 minutes, 24 seconds are expected to further widen uh our reach uh in the market and therefore boost our volumes. Uh second as just 14:33 14 minutes, 33 seconds mentioned uh we are progressing well on the engagement uh with uh a leading Japanese OEM with SOP expected to commence in the first half of FI28. 14:44 14 minutes, 44 seconds Um [clears throat] so vehicle testing on the proof of concept has started early performance results have been 14:52 14 minutes, 52 seconds encouraging and are supporting further refinement as we move into subsequent validation phases. Um while the initial 15:00 15 minutes commercial you know contribution to our top line will be modest entry into the Japanese OEM ecosystem uh is 15:08 15 minutes, 8 seconds strategically very very significant. uh this is a highly demanding ecosystem that requires a high degree of trust, 15:15 15 minutes, 15 seconds credibility uh you know and ex execution capability. 15:20 15 minutes, 20 seconds Securing this nomination is a strong validation of Divi's engineering and manufacturing strengths and has the 15:27 15 minutes, 27 seconds potential to open doors for engagement with other leading Japanese OEMs over time. Third, uh alongside these 15:36 15 minutes, 36 seconds developments, I'm happy to share with you that we are evaluating the feasibility for establishing a manufacturing footprint in the United 15:43 15 minutes, 43 seconds States uh as part of our long-term growth strategy. The objective is to deepen our global presence, enhance 15:51 15 minutes, 51 seconds customer proximity and capture the growth opportunity in the diversified North American market by leveraging our 15:59 15 minutes, 59 seconds technical know-how to offer highquality products at competitive pricing. We expect this evaluation will reach some 16:07 16 minutes, 7 seconds logical prelim preliminary logical conclusion u by Q1 end of Q1 FI27. 16:16 16 minutes, 16 seconds Finally, uh in addition to uh OEM growth, we continue to see steady demand from institutional customers uh 16:24 16 minutes, 24 seconds including repeat orders and opportunities from the Indian Army. 16:29 16 minutes, 29 seconds These orders provide volume stability and most important of all further validate the reliability and robustness 16:37 16 minutes, 37 seconds of our of the engineering solutions we provide in demanding operating environments. And to that extent uh 16:44 16 minutes, 44 seconds these applications bolster and butress uh uh our brand value. 16:51 16 minutes, 51 seconds Uh turning now to our EV transmission business. Uh while we have seen some improvement uh performance remains below 17:00 17 minutes our uh initial expectations. Overall EV volumes in the market have been largely flat um with sort of you know it's 17:09 17 minutes, 9 seconds rangebound with sort of anxiet range anxiety on these vehicles continuing to impact customer adoption. Uh as a result 17:17 17 minutes, 17 seconds EV the EV transmission segment uh has remained modest. 17:23 17 minutes, 23 seconds uh given the slower pace of EV penetration uh we expect volume improvement in this business to be gradual and spread over time rather than 17:32 17 minutes, 32 seconds front-loaded. Uh that said we have made meaningful progress on the product and capability front. Uh we are in the 17:40 17 minutes, 40 seconds concluding uh phase of developing a new 120 kW 220 Newton meter torque capacity 17:48 17 minutes, 48 seconds uh transmission uh that will go on four models of one of our key customers in this segment. Uh while the ramp up has 17:55 17 minutes, 55 seconds been slower than anticipated, we believe the business is moving in the right direction. The delay uh has been due to 18:04 18 minutes, 4 seconds uh hiccups that the uh OEM has faced in their vehicle testing but it's moving in the right direction and as of now uh 18:13 18 minutes, 13 seconds indication that we have is that SOP will be in April uh of uh 2026. 18:21 18 minutes, 21 seconds Um our focus has also been on improving the quality and resilience of the EV transmission business. We are actively 18:29 18 minutes, 29 seconds working to enhance contribution margins and broaden our engagement across multiple customers and platforms. Uh I 18:36 18 minutes, 36 seconds might mention that we continue uh to configure solutions for the uh three-wheeler industry where we believe 18:44 18 minutes, 44 seconds electrification is going to move uh at a very fast pace. This strategy is aimed at uh uh reducing dependence uh on any 18:53 18 minutes, 53 seconds single model or program, mitigating risks ar arising from variability in individual vehicle performance and 19:01 19 minutes, 1 second building a more balanced and diversified EV transmission portfolio. We are in the 19:08 19 minutes, 8 seconds uh concluding sort of phases of building uh a very impressive portfolio 19:15 19 minutes, 15 seconds uh uh of products and the constituent uh uh parts and subasssemblies that go into 19:22 19 minutes, 22 seconds these products across the spectrum from 10 kilowatt all the way to 150 kowatt um 19:30 19 minutes, 30 seconds and offer with a uh the ability to respond very fast uh to market developments. 19:39 19 minutes, 39 seconds Uh and uh I will be sharing updates every quarter as we go along. Um 19:46 19 minutes, 46 seconds turning to uh our components business, this segment uh has been the clear star performer for us, delivering 19:54 19 minutes, 54 seconds consistently strong growth over the past year uh primarily driven by uh exports. 20:00 20 minutes On a year-to-year basis, the component business recorded a very impressive growth of over 120%. 20:08 20 minutes, 8 seconds Uh to put some numbers around this trans transformation, uh export revenues which 20:14 20 minutes, 14 seconds were sort of negligible in FI 23 have now reached a quarterly run rate of approximately 19 uh crores. uh this 20:24 20 minutes, 24 seconds represents a significant turnaround driven by focused execution and disciplined efforts in building export 20:31 20 minutes, 31 seconds capabilities. Uh I'm pleased to inform that um as a result of this work um we 20:38 20 minutes, 38 seconds have been invited uh for a supplier conference in the US in the first week of March and uh uh I believe we are the 20:46 20 minutes, 46 seconds only Indian company uh at this American uh tier 1 supplier uh conference. 20:53 20 minutes, 53 seconds um performance uh during this period uh was largely supported by higher volumes uh 21:00 21 minutes from our key c uh uh export customers that include Bog Warner and Magna. Uh these relationships reflect the growing 21:09 21 minutes, 9 seconds acceptance of our precision engineered components within global supply chains as well as our ability to meet stringent quality delivery and performance 21:18 21 minutes, 18 seconds requirements across uh sort of a global footprint. Uh importantly this also indicates increasing scale and deeper engagement with global customers. 21:29 21 minutes, 29 seconds Uh despite ongoing global uncertainties including tariff related actions in the United States, export markets have 21:37 21 minutes, 37 seconds remained very encouraging. Uh I attribute this to the relative competitive advantage uh Indian 21:44 21 minutes, 44 seconds companies like us have visav our Chinese competitors. During the period we regained momentum in our export business 21:52 21 minutes, 52 seconds and did not experience any material disruption in the component segment. 21:57 21 minutes, 57 seconds This resilience is supported by the very specialized nature of the products we supply and the massive scale at which it 22:05 22 minutes, 5 seconds has to be they have to be executed uh and our positioning in niche high value applications. 22:12 22 minutes, 12 seconds During the quarter, we further strengthened our export footprint by commencing supplies to new geographies 22:19 22 minutes, 19 seconds uh like Portugal and Europe, enhancing our diversification across markets and customers. As revenue contribution from 22:27 22 minutes, 27 seconds this segment continues to increase, it is also enhancing the overall quality and sustainability of our revenue mix. 22:35 22 minutes, 35 seconds And if you combine this with recent uh announcements that have come regarding the FDA with the EU and the US, this can 22:44 22 minutes, 44 seconds only mean uh good news for us. Coming to the big picture and our next orbit of growth, which is automatic transmissions. This represents a 22:53 22 minutes, 53 seconds significant long-term opportunity for the company as I have consistently highlighted. Currently, automatic transmissions used in India are largely 23:01 23 minutes, 1 second imported with very limited domestic manufacturing and predominantly supplied by overseas tier one players. However, 23:09 23 minutes, 9 seconds the case for localization is becoming increasingly compelling. This is supported by government initiatives 23:16 23 minutes, 16 seconds promoting domestic manufacturing, the impact of rupee depreciation and therefore rising import costs and 23:24 23 minutes, 24 seconds something that is not adequately appreciated which is the needle product customization in the Indian 23:32 23 minutes, 32 seconds market. Together these factors create a strong economic and strategic rationale for building local capabilities in this 23:40 23 minutes, 40 seconds segment. From a strategic ST standpoint, automatic transmissions also complement our transfer case business, enabling us 23:48 23 minutes, 48 seconds to move towards more integrated drivetrain solutions. Over the last few months, our team has worked on and completed the initial commercial 23:57 23 minutes, 57 seconds assessment of localizing this technology. We have also engaged with customers on the initial com uh 24:04 24 minutes, 4 seconds commercial assessment. In parallel, our engineering team is focused on capturing customer expectations and benchmarking 24:12 24 minutes, 12 seconds to build product differentiation. By the second quarter of FI27, we plan to conclude a technology demonstrator for uh one of our largest uh OEM customers. 24:24 24 minutes, 24 seconds Our economic analysis shows significant cost savings uh of more than 10% um you 24:32 24 minutes, 32 seconds know on a price of more than one lakh and improve improvement in working capital efficiency in the value chain. 24:40 24 minutes, 40 seconds Directionally, we hope to conclude a contract by July 2026, which would give us approximately a launch date of 24:48 24 minutes, 48 seconds sometime in calendar 2028, which would be FI29. 24:54 24 minutes, 54 seconds Uh I hasten to add that no contract has been concluded. This is I'm giving some directional uh information. The team, 25:03 25 minutes, 3 seconds our team is focused on addressing the key ch key challenges including supply chain localization, competitiveness and sustainability. 25:12 25 minutes, 12 seconds Uh automatic transmission product requires collaboration with suppliers across India, Europe, United States, Korea, Taiwan and China. 25:23 25 minutes, 23 seconds From a business development perspective, we continue to see a strong pipeline of opportunities. Engagements with both 25:30 25 minutes, 30 seconds existing and prospective customers uh remain active with growing interest in our capabilities particularly niche high 25:38 25 minutes, 38 seconds precision applications where reliability and engineering depth are critical. 25:44 25 minutes, 44 seconds Over the past few quarters uh quarters, we have also made meaningful progress in diversifying our revenue mix across 25:52 25 minutes, 52 seconds customers and geographies. This deliberate expansion of our export footprint has reduced concentration risk 25:59 25 minutes, 59 seconds and enhanced the resilience of our business model positioning us well to manage external uncertainties including trade related developments. 26:08 26 minutes, 8 seconds Overall, demand for critical drivetrain and transmission components remains steady across domestic and international markets, supported by a strong order 26:17 26 minutes, 17 seconds pipeline and longstanding customer relationships. We remain confident in our ability to navigate near-term uncertainties while continuing to execute on our long-term growth plans. 26:30 26 minutes, 30 seconds In closing, I would like to highlight a recent milestone that reflects the strength of our partnerships and the 26:37 26 minutes, 37 seconds growing recognition of Divi's brand in the industry. During the quarter, we were proud to be associated with the 26:45 26 minutes, 45 seconds successful launch of the new Mahindra XUV 7 XUV 7XO where our brand was 26:52 26 minutes, 52 seconds prominently featured as part of the official launch campaign. This recognition underscores the confidence 26:59 26 minutes, 59 seconds that leading OEMs like Mahindra, you know, place in our engineering depth, manufacturing excellence and delivery 27:06 27 minutes, 6 seconds track record. It also reinforces our position as a trusted drivetrain solutions partner for Marqu Automotive 27:15 27 minutes, 15 seconds Programs built on collaboration, quality, and innovation. 27:21 27 minutes, 21 seconds Going ahead, we remain firmly focused on driving sustainable growth by maintaining execution discipline, 27:28 27 minutes, 28 seconds enhancing operational efficiencies, and strengthening the quality of our earnings. 27:50 27 minutes, 50 seconds I'm sorry to interrupt sir. We are unable to hear you. Is it just now? Hello. 27:58 27 minutes, 58 seconds Yes. Yes. Yes. Is it okay now? Yes, it is sir. Please go ahead. 28:04 28 minutes, 4 seconds Yeah. Um, so let me just back up a little bit. I was saying that going ahead we remain firmly focused on driving sustainable growth by 28:12 28 minutes, 12 seconds maintaining execution discipline, enhancing operational efficiencies and strengthening the quality of our 28:19 28 minutes, 19 seconds earnings. At the same time, we will continue to expand our presence across both domestic and global markets 28:26 28 minutes, 26 seconds supported by a diversified product portfolio, growing export footprint, and a forward-looking technology roadmap. 28:35 28 minutes, 35 seconds We believe this balanced approach positions us well to navigate near-term uncertainties while building long-term 28:42 28 minutes, 42 seconds value uh for you, our valued stakeholders. So with that let me conclude my opening remarks and hand 28:51 28 minutes, 51 seconds over the proceedings to my colleague our CFO Sudir Mirjankar. Thank you very much. 29:02 29 minutes, 2 seconds Uh thank you sir. Good afternoon to everyone on the call. Uh before presenting the financial numbers for Q3 29:10 29 minutes, 10 seconds and 9 month FY26 I would like to highlight a few key points. 29:16 29 minutes, 16 seconds I am pleased to share that the strong volume uh momentum has continued to sustain through 9 month of FYI 26. 29:26 29 minutes, 26 seconds The growth uh has been broadbra across our two major segments transfer cases 29:32 29 minutes, 32 seconds and components both of which continue to demonstrate strong traction. Our transfer case business benefited from 29:40 29 minutes, 40 seconds healthy volume of tech from key OEM customers while our component segment which is predominantly export-driven uh 29:49 29 minutes, 49 seconds continued its strong upward trajectory as global demand for our high precision components remained steady. 29:58 29 minutes, 58 seconds Speaking of the financial performance of 9 months FY26 performance uh in 9 months FY26 we delivered our 30:07 30 minutes, 7 seconds highest ever 9 month total income of rupes 261.4 crores resisting a strong 48% 30:15 30 minutes, 15 seconds year-on-year growth from rupees 176 crores in 9 month of FY25. 30:22 30 minutes, 22 seconds This growth was led by sustained momentum in transfer cases volumes and continued robust performance in component business. 30:32 30 minutes, 32 seconds Uh on revenue mix the transfer case segment delivered strong growth of 58% yearonear compared to 9 month of FY25. 30:44 30 minutes, 44 seconds We have continued to witness healthy volume traction through the 9-month period primarily driven by higher uptake 30:52 30 minutes, 52 seconds from our key OEM customer and we remain confident that this movement will sustain in the coming quarters. 31:01 31 minutes, 1 second The EV transmission segment increased by 11% in 9 months of FY26 compared to 9 months of FY25. 31:09 31 minutes, 9 seconds The segment has remained largely rangebound due to subdued EV volumes in 31:15 31 minutes, 15 seconds the market. However, we expect a ramp up in the coming quarters supported by strong customer 31:24 31 minutes, 24 seconds and deeper integration across newer uh EV platforms. 31:31 31 minutes, 31 seconds The component segment continued its robust performance growing 117% 31:38 31 minutes, 38 seconds in 9 month of FY26 compared to 9 month of FY25. 31:44 31 minutes, 44 seconds This exceptional growth was largely exportled despite global market uncertainty. 31:51 31 minutes, 51 seconds We expect this momentum to sustain in coming quarters as well. 31:58 31 minutes, 58 seconds Exports continue to steadily increase its share in the overall total income mix. In 9 month of FY26, exports 32:07 32 minutes, 7 seconds contributed around 17% of total income and we are progressing well forward well 32:13 32 minutes, 13 seconds toward our medium-term target of 20 to 25%. 32:19 32 minutes, 19 seconds Gross margin for 9 month acquired 26 stood at 63.2% 2% mainly in line with 9 months of FY25. 32:29 32 minutes, 29 seconds AIDA for 9 month FY26 came in at rupees 64.4 crores registering a healthy 46% 32:38 32 minutes, 38 seconds yearon-year growth from rupees 44 K in 9 month of FY25. 32:44 32 minutes, 44 seconds The improvement was largely supported by a better product mix and operating leverage benefits arising from higher 32:53 32 minutes, 53 seconds volumes which resulted in improved absorption of fixed cost. IITA margin for the period stood at 24.7%. 33:03 33 minutes, 3 seconds Profit after tax for 9 month of FY26 stood at rupees 31.4 4 crores reflecting 33:10 33 minutes, 10 seconds a strong 65% yearon-year growth from rupees 19 crores in 9 months of FY25 33:18 33 minutes, 18 seconds driven by enhanced operating efficiency and higher volumes in major segments 33:26 33 minutes, 26 seconds leading to further centering of overall profitability. Pat margin stood at 12%. 33:34 33 minutes, 34 seconds Additionally uh during the quarter the company recognized an incremental financial impact of rupees 76.5 lakhs 33:44 33 minutes, 44 seconds pursuant to regulatory changes under the newly notified labor force. 33:52 33 minutes, 52 seconds Coming to quarterly numbers in Q3 FY26 we have surpassed our previous best 33:58 33 minutes, 58 seconds performance uh which we achieved in Q2 of FY26 which itself was a record quarter for 34:05 34 minutes, 5 seconds the company. We delivered our highest ever quarterly total income of rupees 96.3 crores registering a strong 68% 34:14 34 minutes, 14 seconds year-on-year growth from rupes 57.5 kores in Q3 of FY25 and a 9% sequential growth over Q2 of FY26. 34:26 34 minutes, 26 seconds The bit for the quarter stood at rupees 23.4 4 crores reflecting a 72% increase 34:34 34 minutes, 34 seconds from rupees 13.6 crores in Q3 of FY25 and a 6% sequential growth over Q2 of FY26. 34:46 34 minutes, 46 seconds Thea margin for the quarter was healthy at 24.3%. 34:51 34 minutes, 51 seconds Profit after tax for Q3 FY26 came in at rupees 11.8 8 crores marking a 125% 35:00 35 minutes yearonear increase from rupees 5.2 crores in Q3 of FY25 and a 9% sequential 35:08 35 minutes, 8 seconds rise from rupees 10.7 K in Q2 of FY26 margin for the quarter stood at 12.2%. 35:19 35 minutes, 19 seconds This consistency in performance reflects the strength of our product portfolio, the resilience of our customers 35:26 35 minutes, 26 seconds relationships and the disciplined execution of our teams across functions. 35:32 35 minutes, 32 seconds Uh with the visibility, we currently have the opportunities in the pipeline. 35:36 35 minutes, 36 seconds We expect this positive moment to continue in the coming quarters as well. 35:42 35 minutes, 42 seconds That's it from my side. Now I would like to open the floor for questions and answers. Thank you. 35:51 35 minutes, 51 seconds Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on the touchstone 36:00 36 minutes telephone. 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 36:09 36 minutes, 9 seconds question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. 36:29 36 minutes, 29 seconds The first question is from the line of Mahesh Paint from Malci Mutual Fund. Please go ahead. 36:36 36 minutes, 36 seconds Uh, hi sir, thank you so much for the opportunity. 36:40 36 minutes, 40 seconds uh and sir congratulations for very strong numbers and uh recovery across all the business segments. Uh thank you ma'am. 36:47 36 minutes, 47 seconds Among sir among all the businesses uh I think the component business is showing a very strong strength now despite uh 36:55 36 minutes, 55 seconds tariff uh in US still we have been scaling up. So sir what is the outlook for this or do you see some point of 37:02 37 minutes, 2 seconds time uh this business can become bigger than the uh transfer case? 37:08 37 minutes, 8 seconds Yeah, thank you. Uh that's an important question. It gives us uh a very good uh opportunity to provide some further uh 37:16 37 minutes, 16 seconds amplification and light on this important subject. Uh see you have to understand that the United States um has 37:25 37 minutes, 25 seconds imposed uh higher duties across all countries. 37:30 37 minutes, 30 seconds uh our principal competitor uh for precision manufacturing is actually China not uh Japan or Korea or Europe 37:40 37 minutes, 40 seconds who actually are very expensive countries to buy from uh and China faces 37:46 37 minutes, 46 seconds today uh a duty of almost 60% on uh equivalent uh components which is why I 37:53 37 minutes, 53 seconds said that we have an overwhelming decisive advantage against China Um India of course has to compete against 38:01 38 minutes, 1 second with countries like Thailand and Vietnam uh in in some auto components but when it comes to powertrain components uh 38:09 38 minutes, 9 seconds India has a decisive advantage u you know we get inquiries practically every 38:16 38 minutes, 16 seconds week and uh now that there is some clarity long-term clarity on how the US administration 38:23 38 minutes, 23 seconds u you know regardless of which party is in power will handle the import regime team uh we can now do our long-term 38:31 38 minutes, 31 seconds planning uh in a in a clearer way. Uh that is why uh my brother and I are in 38:37 38 minutes, 37 seconds the US in the first week uh of March uh to investigate u you know which part of 38:44 38 minutes, 44 seconds the US would be the best place to set up an initial uh sort of beach head uh uh 38:51 38 minutes, 51 seconds presence if I may say so. We need that to have deeper engagement with our customers that include uh Bana, Magna, Ford uh and General Motors among others. 39:04 39 minutes, 4 seconds Um uh we are also in talks with uh Mahindra and North America. So we have as you can see three to five critical 39:13 39 minutes, 13 seconds anchor customers that that we are working with and based on the uh nature of inquiries that are coming uh there of 39:21 39 minutes, 21 seconds two types. One is immediate uh outsourcing of relatively low value components that people want to get out 39:29 39 minutes, 29 seconds of uh China because of the very high duties. Uh and the other one is uh you know really long-term new developments 39:37 39 minutes, 37 seconds that are happening for new vehicle programs uh in the US. The end applications are almost always with uh 39:45 39 minutes, 45 seconds vehicles that that come from Ford, GM and Chrysler. um even if it is through one of the big tier ones uh the US 39:54 39 minutes, 54 seconds market continues to remain uh vibrant and so even if there are uh you know there are sort of a little volatility is 40:02 40 minutes, 2 seconds there compared to the compared to India uh that market size is much larger uh 40:10 40 minutes, 10 seconds over the years what has happened is the United States uh because of globalization uh has uh sort of deinvested in 40:19 40 minutes, 19 seconds capabilities like this. So even if the government wishes u you know to bring back manufacturing into the US which is 40:28 40 minutes, 28 seconds itself a sort of uh questionable proposition uh it will take a lot of time and it will take a far more 40:35 40 minutes, 35 seconds graduated and nuanced approach if they have to be successful. uh the current sledgehammer approach of applying you 40:43 40 minutes, 43 seconds know uniform duties across all categories of uh imports we believe is not going to work. Uh so in the short 40:51 40 minutes, 51 seconds term and medium-term uh the demand position is very good and you know we uh our teams uh have done an a fantastic 40:59 40 minutes, 59 seconds job of executing extremely precise uh you know specifications on components. 41:06 41 minutes, 6 seconds In in one particular instance uh the customer has actually desourced uh an 41:14 41 minutes, 14 seconds American supplier and moved that business to India. not so much of course the cost factor is always there but it's 41:21 41 minutes, 21 seconds more because of our quality uh and uh delivery uh uh performance. So we 41:28 41 minutes, 28 seconds clearly see uh that India has a decisive capability advantage today relative to 41:37 41 minutes, 37 seconds uh suppliers in Europe uh Mexico uh I would say even China uh uh so we need to 41:46 41 minutes, 46 seconds build on this capability make sure that we sustain uh you know the capabilities we've built up in our organization 41:54 41 minutes, 54 seconds continue investing in education and training of our people and sustain that competitive edge. If we do this, this 42:02 42 minutes, 2 seconds business uh I'm confident can be taken to more than uh 200 crores u you know between supplies out of here and a small 42:11 42 minutes, 11 seconds presence in the US. Whether it is actually able to overtake the transfer case business uh is a question which is 42:18 42 minutes, 18 seconds very difficult for me to answer because we are also going global with our transfer case business and the transfer case business has a huge advantage of 42:27 42 minutes, 27 seconds scale because each unit sells you know for several as you know uh thousands of rupees. So if I sell you know a few 42:36 42 minutes, 36 seconds thousand transfer cases that's worth many many thousand individual components. So from our standpoint, 42:43 42 minutes, 43 seconds growing the transfer case business is actually a better idea and a better strategy uh you know in in terms of 42:51 42 minutes, 51 seconds creating a sustainable sort of mode or or ring fencing our business. Okay. So 42:58 42 minutes, 58 seconds but the idea is that u they complement each other. They enable us to have some diversity uh in our portfolio uh 43:06 43 minutes, 6 seconds diversity of uh uh geography and you know let me conclude by saying that uh while technology-led innovation is the 43:15 43 minutes, 15 seconds spearhead uh of our strategy right behind that is uh geographic and 43:21 43 minutes, 21 seconds customer uh diversity and product and application diversity and it is with this approach that we can build uh a 43:31 43 minutes, 31 seconds resilient business model. So the short to conclude then yes we are optimistic about the component business uh you know 43:39 43 minutes, 39 seconds we continue not only the west side which is Europe, United States, Mexico but we also continue to work hard in markets 43:48 43 minutes, 48 seconds like Thailand, Korea uh Indonesia um and also Japanese uh customers uh 43:56 43 minutes, 56 seconds through the arrangement we have with Toyota Susho. I I hope I answered your question adequately Mahes. 44:03 44 minutes, 3 seconds Yeah. So just additional question I mean uh obviously transfer case is a business you want to take globally but uh it's a 44:10 44 minutes, 10 seconds very uh sophisticated product. It will take time to get into global OEM's value chain but uh meantime there is a high 44:19 44 minutes, 19 seconds possibility we can scale up component business where entry barriers may not be as high as transfer case. So in that context I was asking for next 2 years uh 44:28 44 minutes, 28 seconds given the opportunities because of the tariff on Chinese players uh is it possible to scale up for us significantly? 44:36 44 minutes, 36 seconds Yes. Yes. And we are making investments. 44:38 44 minutes, 38 seconds We as you know we have uh uh an office uh in Cologne in Germany uh and uh we uh 44:47 44 minutes, 47 seconds and and that's the reason why um we are investing in creating a presence in the US. So we certainly have the faith uh 44:56 44 minutes, 56 seconds that uh uh the uh exports uh will give us uh you know a sort of sustainable way of of continuing growth in the business. 45:06 45 minutes, 6 seconds We we are certainly very confident. So the answer to your question is yes. Sure. Thank you. Thank you so much sir. 45:13 45 minutes, 13 seconds You're welcome. 45:17 45 minutes, 17 seconds Thank you. The next question is from the line of Karti from Suesh Advisers. Please go ahead. 45:23 45 minutes, 23 seconds Uh sir, good afternoon. I hope I am audible. Uh yes, Karthik. 45:28 45 minutes, 28 seconds Yes sir. Uh thanks. Uh couple of questions or clarifications are there. 45:32 45 minutes, 32 seconds One is on the order that you announced with Mahindra and Tatas. Uh would any would there be any overlap between these volumes that you have indicated and the 45:40 45 minutes, 40 seconds existing volumes or are these completely incremental? Uh more important clarification there would be what determines volumes? Are these existing 45:48 45 minutes, 48 seconds volumes that you're absorbing or is it like you know as they scale up in their markets you would scale up volumes? 45:56 45 minutes, 56 seconds No. Uh so what has happened is I think uh the government of Indonesia had a tender out there global tender companies 46:04 46 minutes, 4 seconds across the world bid on it and I think our uh Indian OEMs did just a fantastic job of convincing 46:13 46 minutes, 13 seconds uh representatives of the Indonesian government that we could do the job. So the answer to your question is uh it is 46:21 46 minutes, 21 seconds absolutely 35,000 each. It's an incremental uh order of 70,000 units. Uh the good 46:28 46 minutes, 28 seconds news is that we are the exclusive transfer case supplier uh in both both customers. So it is for us if I may say 46:37 46 minutes, 37 seconds if I pardon me for saying so it's like a double whammy uh for us. uh this is going to be over and above uh whatever 46:46 46 minutes, 46 seconds existing business plans they had in originally in their budget for FI27. 46:52 46 minutes, 52 seconds Uh the concern I think is whether they have the capacity uh to manage. We 46:59 46 minutes, 59 seconds certainly have the capacity. Um I'm not you know I don't know about the OEMs but these are timebound export orders. They 47:08 47 minutes, 8 seconds represent a very very critical opportunity to crack open the ASEAN market against some very tough 47:16 47 minutes, 16 seconds competition from China and Japan and and the the and the Korean OEMs if if I may add. So I don't think Tata and Mahindra are going to let go of this opportunity. 47:27 47 minutes, 27 seconds This these uh export orders will have very very high priority and uh we are working on a daily basis in coordination 47:37 47 minutes, 37 seconds uh with these companies to smoothen the ramp up which is going on right now and it will it will hit full tilt by uh the 47:46 47 minutes, 46 seconds May June time frame and deliveries would be within the calendar year sir is that correct to understand? 47:54 47 minutes, 54 seconds Yeah. Uh maybe from India uh they will be delivered till uh the first few months of next year but we certainly 48:03 48 minutes, 3 seconds hope to finish our execution by December. 48:07 48 minutes, 7 seconds Right. Right. Uh just to add sir are these annual tenders or would these be uh uh term contracts? 48:14 48 minutes, 14 seconds Yeah, these are uh short-term uh contracts right now, but the nature of the business is such that once they 48:22 48 minutes, 22 seconds deliver uh and they demonstrate their capability uh you know given that both Shata Motor 48:30 48 minutes, 30 seconds and Mindra are listed companies and they have u you know they are conscious of of the implications of these uh contract 48:38 48 minutes, 38 seconds they're not going to rest on these laurels. I have no doubt that that now taking advantage of this opportunity 48:46 48 minutes, 46 seconds both organizations will now step up their global uh marketing and sales because they've realized now that that 48:54 48 minutes, 54 seconds um they have a decisive advantage for various reasons. uh you know I I don't know it's it's cost it's geopolitical 49:02 49 minutes, 2 seconds it's it's many many things the ability to provide backup service um you know that's very critical for uh the 49:09 49 minutes, 9 seconds government of Indonesia as it will be tomorrow for governments in central Asia in North Africa in South America the 49:16 49 minutes, 16 seconds world is a very big place uh and I have no doubt that both companies will build on this achievement of theirs 49:24 49 minutes, 24 seconds sure sure I I just wanted to reassure myself of the sustainability of these export volumes which is why I was asking you this question sir. 49:32 49 minutes, 32 seconds Yeah. Yeah. But you you are absolutely right as of now uh it is a a specific 49:38 49 minutes, 38 seconds contract uh u and obviously it will it will conclude uh before the end of uh financial year FI27. 49:49 49 minutes, 49 seconds Sure. The other thing would be to clarify on the guidance that you gave. I I wouldn't use the word guidance rather your aspiration shall I say. you said on 49:58 49 minutes, 58 seconds 15 to 20% growth on FY20 base. Uh so so you know I mean uh without being too 50:04 50 minutes, 4 seconds cute about it would,000 cr by FI30 be an ambitious target for you now realistically speaking given what all you have experienced? 50:12 50 minutes, 12 seconds Yeah. uh see for us to uh let me clarify we are a little disappointed that uh we 50:19 50 minutes, 19 seconds are not yet on the path uh 2,000 uh that is going to depend upon picking 50:26 50 minutes, 26 seconds up uh a contract in any one of our one or more of our four verticals and and 50:34 50 minutes, 34 seconds just to reiterate for clarification our four verticals are manual transmissions four-wheel drive systems uh EV 50:41 50 minutes, 41 seconds transmissions and automatics. Across these uh one or more, we need a large uh uh order which 50:52 50 minutes, 52 seconds is several hundred crores to get onto the path to achieve the thousand. We 50:58 50 minutes, 58 seconds believe we are on that path. Uh we also have the faith that along the way there 51:05 51 minutes, 5 seconds will be uh if I may say so uh other serendipitous kind of uh opportunities uh like the one that has come this year. 51:15 51 minutes, 15 seconds Uh and my experience of the last 30 years shows that as you build the experience, opportunities do come along 51:24 51 minutes, 24 seconds because there are customers who are watching you uh and they realize that uh here is a company that is uh reliable, 51:32 51 minutes, 32 seconds dependable uh you know and is well-rounded in giving this kind of service. So uh to to come back to the 51:42 51 minutes, 42 seconds crux of your question 12 to 15% CAGGR is something we are uh committed to. Uh we 51:49 51 minutes, 49 seconds believe that this year and next year uh we will deliver uh that uh performance. 51:56 51 minutes, 56 seconds Beyond that we have many things in the pipeline. uh I do I'm not at liberty to because of confidentiality agreements 52:04 52 minutes, 4 seconds and all that to share all that but suffice it to say that uh we are keen that by the next quarter we we should be 52:12 52 minutes, 12 seconds in a position to give uh further updates. Uh look at my request to our uh 52:19 52 minutes, 19 seconds investor community friends would be to look at the last four to eight quarters. 52:25 52 minutes, 25 seconds Yes there have been some blips but two things have happened. We have not uh taken our eye off the ball in terms of 52:33 52 minutes, 33 seconds financial discipline and persevered to deliver 20 plus% plus IITA while investing in the growth. Okay, which is 52:42 52 minutes, 42 seconds a delicate balance and every quarter or two quarter once in two quarters we are making announcements [clears throat] 52:50 52 minutes, 50 seconds of interesting new ideas and breakthroughs. Okay. So yes uh next quarter I hope to give you 52:58 52 minutes, 58 seconds further updates on our automatic but also on the EV transmission. Uh we believe that our EV transmission product 53:06 53 minutes, 6 seconds is also a global product and it is going to be helped by a very strong domestic market. It is our domestic market that 53:15 53 minutes, 15 seconds is going to that is unleashing uh the sort of innovative spirit in our company and we should we will be 53:23 53 minutes, 23 seconds leveraging and harnessing that as we go global. So our global competitiveness comes from our domestic market. 53:32 53 minutes, 32 seconds Yeah. Sure. Sure. Sure. Just quick last question sir. uh profitability. Is there any scope for going beyond the 20% range 53:41 53 minutes, 41 seconds immediately or do you believe that for the moment that is the number to work with? 53:45 53 minutes, 45 seconds Yeah, I think that's uh uh you know I by nature I'm a very conservative man. I don't like to uh you know promise the 53:54 53 minutes, 54 seconds earth and the moon. Uh but uh our job is to be steady long-term. Okay. And uh 54:01 54 minutes, 1 second much like the uh a a slow patient wise investor uh long-term compounding is 54:08 54 minutes, 8 seconds where we will deliver value. We are in this for the long term. Uh our business is more than 60 years old and through 54:15 54 minutes, 15 seconds the thick and thin of the Indian history and economy we have survived uh and delivered growth. So I ask you to have faith in that. 54:25 54 minutes, 25 seconds Sure. Sure. Uh of course sir very best wishes. Very best wishes. Thank you. 54:32 54 minutes, 32 seconds Thank you. The next question is from the line of Yash Meta from AART Ventures. Please go ahead. 54:39 54 minutes, 39 seconds Yeah. Uh sir, congratulations on a very good set of numbers. Uh sir, first question is could you throw some light on the exclusive distribution agreement 54:48 54 minutes, 48 seconds with Toyota Sushu? Uh and is it different from the from the 62 cr contract received from Sushu in November? 54:59 54 minutes, 59 seconds Uh yeah. So uh uh Toyota uh uh so one is uh we have an agreement with Toyota 55:07 55 minutes, 7 seconds Susho uh and I can take the liberty to use the word exclusive because our 55:13 55 minutes, 13 seconds understanding is that in the realm of Japanese OEMs, we will use Toyota Susho 55:21 55 minutes, 21 seconds as our marketing and distribution agent and reciprocally Toyota Susho if there is a need for drivetrain components and 55:29 55 minutes, 29 seconds systems uh in area of transmissions and transfer cases. Our four verticals, we are their exclusive manufacturing 55:36 55 minutes, 36 seconds partner in India. Okay, this is a matter of tremendous honor for us because 55:43 55 minutes, 43 seconds Toyota Susho is an $80 billion giant uh Toyota group member company 55:50 55 minutes, 50 seconds headquartered in Nagagoya, Japan. and uh the confidence they have shown in us uh and with their help we are growing uh 55:59 55 minutes, 59 seconds global especially on the on the eastern in the eastern hemisphere in countries like Korea, China, Thailand, Japan 56:08 56 minutes, 8 seconds itself. Uh Toyota Susho is an invaluable partner for us. uh you know the products that we make uh because of their 56:18 56 minutes, 18 seconds uniqueness uh in their configuration and technology often require inputs that come from across the world and managing 56:26 56 minutes, 26 seconds logistics uh when you're operating at scale uh is a tremendous competence. 56:32 56 minutes, 32 seconds Toyota Susho is a partner for us in this endeavor uh with that with their competence uh and because of their scale 56:40 56 minutes, 40 seconds uh they are able to handle logistics extremely efficiently and extremely competitively. Uh so both inbound 56:46 56 minutes, 46 seconds logistics of uh import components and outbound logistics of our products. This is where our partnership will work. Now 56:55 56 minutes, 55 seconds in the current instance where we have a Japanese OEM having um the 57:02 57 minutes, 2 seconds cultural dexterity of our Japanese colleagues in Susho to persuade the Japanese both in India and in Japan uh 57:11 57 minutes, 11 seconds has been invaluable for us. uh and by uh sort of giving our Japanese OEM customer 57:19 57 minutes, 19 seconds uh critical insights about our capability, Toyota Susho has uh really lived up to their promise of being a 57:26 57 minutes, 26 seconds good partner to us. So this is how we are working. Um and one thing I like uh about the Japanese culture and approach 57:35 57 minutes, 35 seconds is they are slow but they are extremely committed you know and it's like water eroding rock. Uh over time uh they will 57:44 57 minutes, 44 seconds uh uh deliver and winning this OEM contract is absolutely the proof that it can be done. Um and you will hear more 57:54 57 minutes, 54 seconds such uh uh interesting uh announcements as we go ahead. The next step for us now one is this uh transfer case contract 58:03 58 minutes, 3 seconds with the Japanese OEM is in India. The next step is is to with Susho to go overseas uh and the markets we are 58:11 58 minutes, 11 seconds looking at are uh Thailand uh China and Korea and uh our team is very confident. 58:20 58 minutes, 20 seconds We have just come back uh from visits to all these countries and there is tremendous uh optimism in my sales group 58:28 58 minutes, 28 seconds to deliver something in the next 3 months. 58:33 58 minutes, 33 seconds Okay, great to know that sir. Uh and sir, uh have you won any new defense orders for transfer cases? 58:41 58 minutes, 41 seconds Uh no. So the the way this works is we have uh developed this uh product that 58:48 58 minutes, 48 seconds is being used by companies like Mahindra, Tata, Bharat Forge uh tomorrow 58:55 58 minutes, 55 seconds it will be used by Aishar. So all these uh truck companies that that are in a position to uh provide uh mobility 59:04 59 minutes, 4 seconds platforms that are armorplated uh we will be working uh with them. Uh 59:11 59 minutes, 11 seconds because we have supplied u you know many thousand units uh our name is quite well 59:17 59 minutes, 17 seconds known uh in the army circles. uh we do a lot of uh training of army personnel uh 59:25 59 minutes, 25 seconds uh on frontline forward bases like whether it is Arunachal or Rajasthan or 59:30 59 minutes, 30 seconds Punjab u and uh recently in opindra 59:36 59 minutes, 36 seconds armad was used uh for many for like tactical radars uh anti-tank guided 59:43 59 minutes, 43 seconds missiles uh you know light cannon uh and they did a terrific job on the border. 59:49 59 minutes, 49 seconds So uh with this track record u you know what this means is that this market is 59:56 59 minutes, 56 seconds now global not just Indian uh uh defense manufacturers but defense manufacturers all over the world uh are being targeted 1:00:04 1 hour, 4 seconds by us now. So uh it's an exciting space also you know the uh Indian army operates in the world's most diverse 1:00:14 1 hour, 14 seconds battlefield uh terrain we have temperatures like Siberia uh you know at 16 in Ladak we have temperatures like 1:00:22 1 hour, 22 seconds the African Sahara in the car desert we have rain and uh like you know on our eastern borders uh uh flat planes in 1:00:31 1 hour, 31 seconds Punjab so higheed uh temperature, sand, snow, ice, you name it. Uh the Indian 1:00:39 1 hour, 39 seconds Army operates there. And to have the uh endorsement and approval of the Indian Army, I feel which is in my humble 1:00:47 1 hour, 47 seconds opinion one of the best armies of the world is a tremendous tremendous uh stamp of approval and this will give our 1:00:56 1 hour, 56 seconds people the self-confidence to take our product line globally. So um and I think 1:01:03 1 hour, 1 minute, 3 seconds with the changing perception of India you can see the FDA with the EU with the US the the people are now digesting the 1:01:11 1 hour, 1 minute, 11 seconds implications of what happened in ops opsindur uh the diplomatic heft of India the perception of India is changing and I 1:01:20 1 hour, 1 minute, 20 seconds would encourage you to look at the order that Tata and Mindra have won in Indonesia as a continuing uh uh you know 1:01:28 1 hour, 1 minute, 28 seconds uh sort of event of this whole transformation that is going on with India. Uh so yeah we are very very you 1:01:36 1 hour, 1 minute, 36 seconds know this is how we look at um you know uh about the view of our customers and view of ourselves uh in this you know rather interesting time that we live in. 1:01:47 1 hour, 1 minute, 47 seconds I I hope that answers your question. 1:01:51 1 hour, 1 minute, 51 seconds Okay. Uh sir just uh just one last question. The component 70 was a bit flat Q on Q. So any any challenges on the components front during the quarter? 1:02:02 1 hour, 2 minutes, 2 seconds Uh let me see uh components. 1:02:11 1 hour, 2 minutes, 11 seconds I'm just looking at uh yeah uh see the components have picked up uh relative to last year and it is a u sort of 1:02:21 1 hour, 2 minutes, 21 seconds continuing uh execution of schedules that we have. uh you will not see quarterto quarter but I would suggest 1:02:29 1 hour, 2 minutes, 29 seconds that you look at yeartoear when we look at components the encouraging thing is components if 1:02:36 1 hour, 2 minutes, 36 seconds you look at Q2 versus Q3 FI26 uh exports u uh you know are have not 1:02:45 1 hour, 2 minutes, 45 seconds gone down marginally it is up I think it's from 18.3 to 18.8 data. 1:02:51 1 hour, 2 minutes, 51 seconds But compared to last year, you'll see that exports have gone up uh five times 1:02:58 1 hour, 2 minutes, 58 seconds and uh domestic components have gone up uh or the overall component base has gone up 124%. 1:03:10 1 hour, 3 minutes, 10 seconds Hello. Yeah. Okay. U Thank you very much, sir. All the best. Thank you. 1:03:17 1 hour, 3 minutes, 17 seconds Thank you. The next question is from the line of SA Jen from Care PMS. Please go ahead. 1:03:24 1 hour, 3 minutes, 24 seconds Hi, thank you for the opportunity and congratulations on the good set of numbers. My first question is on transfer case. What are the current 1:03:31 1 hour, 3 minutes, 31 seconds volumes that we serve in this business and what would be the peak volume that we can serve? Just wanted to understand what kind of capacity we have and the capacity utilization right now. 1:03:43 1 hour, 3 minutes, 43 seconds Yeah. So uh one you know right right now for I think this year you can see that 1:03:50 1 hour, 3 minutes, 50 seconds just the Indonesia volumes are uh and this is now pretty much in the public domain because both Tata and Mindra have 1:03:57 1 hour, 3 minutes, 57 seconds also published uh I think this update uh with the stock exchanges that demand is 70,000 plus uh we have uh what what 1:04:07 1 hour, 4 minutes, 7 seconds already was going on uh within uh uh India with these customers uh our view is that you know we have two assembly 1:04:15 1 hour, 4 minutes, 15 seconds lines uh that we're working on. We are working towards modernizing productivity and that was a decision that was taken 1:04:24 1 hour, 4 minutes, 24 seconds earlier uh to sort of bring in better automation and productivity and modernize these lines uh which we were typically running uh one to two shifts. 1:04:35 1 hour, 4 minutes, 35 seconds We have the ability to operate both lines uh three shifts and you know uh 1:04:41 1 hour, 4 minutes, 41 seconds ramp up uh the volumes. Uh but you know these products also have components that 1:04:48 1 hour, 4 minutes, 48 seconds we have to manufacture. Uh but you know there is always a little bit of up and down. If one segment is up some other segment is down. So the relative 1:04:57 1 hour, 4 minutes, 57 seconds sluggishness in EV means that assets that we had invested in that space are now available to us uh for this ramp up 1:05:07 1 hour, 5 minutes, 7 seconds leading to better utilization. Uh and I think that is the advantage we have that our assets can move across our verticals 1:05:16 1 hour, 5 minutes, 16 seconds rather seamlessly. So uh but the question I think is if we achieve this then what happens next year and the out 1:05:25 1 hour, 5 minutes, 25 seconds years uh and our view is that the component capacity that we are going to 1:05:32 1 hour, 5 minutes, 32 seconds use now for uh transfer cases is will also then be available for our EV business for the manual transmission 1:05:39 1 hour, 5 minutes, 39 seconds business and most importantly for our automatic transmission uh business. So 1:05:45 1 hour, 5 minutes, 45 seconds uh uh to sort of come to the crux of your question uh we have the uh capacity 1:05:53 1 hour, 5 minutes, 53 seconds now uh and with few incremental productivity enhancements uh we we will have the capacity to go up 1:06:01 1 hour, 6 minutes, 1 second to almost 8 to 9,000 deeper 9,000 yeah 9,000 units uh I'm just consulting 1:06:07 1 hour, 6 minutes, 7 seconds my CEO over here 9,000 units uh uh a month Um uh and we believe that gives us 1:06:16 1 hour, 6 minutes, 16 seconds the ability to support our customers uh uh you know over the next 12 to 15 months. 1:06:24 1 hour, 6 minutes, 24 seconds And could you quantify the current volumes like in quarter three what were the volumes that we did? 1:06:31 1 hour, 6 minutes, 31 seconds Uh I think we are averaging now about uh uh 14 13 and a half to 15,000 per quarter. 1:06:41 1 hour, 6 minutes, 41 seconds Okay. And similar question on the EV drivetrain side. What are the current capacity utilizations there and where do 1:06:49 1 hour, 6 minutes, 49 seconds when do we expect the meaningful utilization ramp up? 1:06:53 1 hour, 6 minutes, 53 seconds Yeah. Uh excellent question. um on the EV which we launched in uh the summer of 1:07:00 1 hour, 7 minutes uh summer monsoon of 2023 uh we were told then by uh our customers 1:07:07 1 hour, 7 minutes, 7 seconds to line up capacity of 100,000 units in the fu uh first two years the capacity utilization was most disappointing it was at around uh I would say 20 to 25%. 1:07:19 1 hour, 7 minutes, 19 seconds um that segment continues at that level about 25 to 30%. But with this new product that we have which last two 1:07:28 1 hour, 7 minutes, 28 seconds quarters we have if you've gone to the uh PowerPoint presentation we have uploaded uh it it's called project sigma 1:07:37 1 hour, 7 minutes, 37 seconds u that is expected to give us uh at least additional 3,000. So uh my sense is that the capacity utilization in the 1:07:46 1 hour, 7 minutes, 46 seconds next by the in another 3 months should improve to uh about 40 to uh 60%. So in 1:07:54 1 hour, 7 minutes, 54 seconds other words we'll go from uh the very low of 20% we had a year ago uh to we could be doing more than 50%. So that is 1:08:03 1 hour, 8 minutes, 3 seconds about 5,000 uh 50 to 60,000 a year instead of the 20,000 per year we were doing. Uh I would uh sort of just to 1:08:12 1 hour, 8 minutes, 12 seconds build on the implication of your question SA the EV market is something which excites us a lot. I know it's it's 1:08:21 1 hour, 8 minutes, 21 seconds been disappointing so far but if you talk to the managements at Tata and Mahindra and other OEMs the kind of 1:08:28 1 hour, 8 minutes, 28 seconds investments that are going on uh uh you know are going to drive this market up. 1:08:34 1 hour, 8 minutes, 34 seconds the investments are going not just into vehicle building but also charging infrastructure and once uh the charging 1:08:42 1 hour, 8 minutes, 42 seconds infrastructure comes up to up to uh you know uh speed um I'm telling you the the EV vehicles will be as common uh as ice 1:08:51 1 hour, 8 minutes, 51 seconds and I won't be surprised that if India reaches 30 to 40% u you know EV uh in addition to that uh 1:09:01 1 hour, 9 minutes, 1 second three-wheeler last mile delivery we are going to see electric propulsion simply proliferating 1:09:07 1 hour, 9 minutes, 7 seconds u and unlike Europe and uh the United States where in cold temperatures the efficiency of the electric powertrain 1:09:16 1 hour, 9 minutes, 16 seconds can be a little questionable we don't face that problem because most of metropolitan uh India is you know sort 1:09:25 1 hour, 9 minutes, 25 seconds of warm uh temperate climate and most of it within the tropics so we have no such 1:09:31 1 hour, 9 minutes, 31 seconds problem uh and uh uh you consider the fact that you know uh congestion and the 1:09:38 1 hour, 9 minutes, 38 seconds attendant pollution for air quality is such a hot potato uh in India that state governments, municipalities will be 1:09:46 1 hour, 9 minutes, 46 seconds legislating uh uh you know for uh EV propulsion as time goes by. So we are 1:09:53 1 hour, 9 minutes, 53 seconds very confident we have uh a very unique model uh and one thing that highlights our ability is the speed of execution. 1:10:02 1 hour, 10 minutes, 2 seconds This is very critical in the area of EV. So, uh I'm confident that um 1:10:10 1 hour, 10 minutes, 10 seconds w within India and then using India as a base, our ability to reach out into global markets with EV transmissions 1:10:16 1 hour, 10 minutes, 16 seconds will take our capacity utilization to eventually more than uh 70%. 70 80%. 1:10:25 1 hour, 10 minutes, 25 seconds Okay. But are we in talks with any other OES like ex for export of EVs EV transmission? 1:10:34 1 hour, 10 minutes, 34 seconds Yes, we uh are in in in talks with a variety of uh both tier ones uh and OEMs. 1:10:44 1 hour, 10 minutes, 44 seconds So generally the pattern that we are seeing is uh uh there are large tier ones. So like u the Toyota group will 1:10:52 1 hour, 10 minutes, 52 seconds have its uh tier one. The Hyundai group has its uh tier one. Um uh at Tata 1:10:58 1 hour, 10 minutes, 58 seconds Motors it is Tata Auto components. Um Mahindra works with uh big tier ones 1:11:05 1 hour, 11 minutes, 5 seconds like Sheffler or Valo right. So and they need many of these companies are still importing from China. The only company I 1:11:14 1 hour, 11 minutes, 14 seconds can tell you that has done justice to localization in India is really Tata Motors only. None of the others has any local content. 1:11:24 1 hour, 11 minutes, 24 seconds Okay. Okay. Thank you. Thank you for the opportunity. Thank you. 1:11:30 1 hour, 11 minutes, 30 seconds The next question is from the line of Dan Sha from credit. Please go ahead. 1:11:34 1 hour, 11 minutes, 34 seconds Uh hello sir. So just two questions. So one of the regarding the transfer case for our Tata Motors and Mahindra and Mahindra. So we'll uh so there's a 1:11:43 1 hour, 11 minutes, 43 seconds 70,000 unit requirement. So will we be present will our transfer case be present in all the 70,000 units because I assume there will be some two wheel 1:11:52 1 hour, 11 minutes, 52 seconds drives as well right? No, the these orders are for uh it's 100% four-wheel drive because Indonesia, the government 1:12:01 1 hour, 12 minutes, 1 second of Indonesia is deploying these pickup trucks for uh agricultural cooperatives across Indonesia. And uh I don't know 1:12:10 1 hour, 12 minutes, 10 seconds how familiar you are with the geography of Indonesia. Indonesia spans many time zones east to west and it is one massive 1:12:18 1 hour, 12 minutes, 18 seconds country. It's about 2/3 the size of India. So two over 2 million square kilmters and their uh agricultural 1:12:26 1 hour, 12 minutes, 26 seconds cooperatives evidently are managed by some kind of a central agricultural ministry and they need pickup trucks for 1:12:34 1 hour, 12 minutes, 34 seconds uh you know to navigate through rural uh Indonesia which is very much like uh tropical India uh and they need these 1:12:42 1 hour, 12 minutes, 42 seconds pickup trucks there. So uh most of it is off-road uh in in farm sort of areas where they need the four-wheel drive. So 1:12:50 1 hour, 12 minutes, 50 seconds 100% four-wheel drive and we are today the only supplier because this is a highly sophisticated uh uh drivetrain aggregate. You can't 1:12:59 1 hour, 12 minutes, 59 seconds just you know get up one morning and say I'll develop some supplier development of a transfer case even a simple manual 1:13:06 1 hour, 13 minutes, 6 seconds shift mechanical transfer case integration into a vehicle needs uh at least uh you know 18 to 20 months of uh development work. 1:13:17 1 hour, 13 minutes, 17 seconds Understood. Got it sir. And just one more question so we we we'll be also executing uh 800 cr plus revenue in the next seven years right from H2 for 27. 1:13:29 1 hour, 13 minutes, 29 seconds Uh yeah so uh I think we had put up that was the cumulative life cycle volume we had put out for uh the global pickup uh 1:13:38 1 hour, 13 minutes, 38 seconds truck uh that is being launched by Mahindra next year. 1:13:43 1 hour, 13 minutes, 43 seconds Understood. So this is different and how would the ramp up of this be sir for the if the if we you know go year by year 1:13:51 1 hour, 13 minutes, 51 seconds u see the we have a sort of rough annual volume the exact launch plan uh has not 1:13:58 1 hour, 13 minutes, 58 seconds come to us uh but you know uh remember if this is what Mahindra can do with their 10-year-old Scorpio pickup uh 1:14:07 1 hour, 14 minutes, 7 seconds enhanced with both manual and automatic transmissions and their ability to stay ab breast of evol ing emission norms. 1:14:15 1 hour, 14 minutes, 15 seconds You can imagine what they will do uh with a global quality pickup that rivals the something like the Toyota Hilux or the Isuzu DMAX. 1:14:25 1 hour, 14 minutes, 25 seconds So we have no doubt that that Mindra is going to live up to its uh global vision. Uh just to put things in perspective uh if you look at where 1:14:34 1 hour, 14 minutes, 34 seconds Mahindra was in 2021, okay before they launched the THAR and the uh uh Scorpio 1:14:42 1 hour, 14 minutes, 42 seconds N and the XUV family which is 3XO and 7XO, they were just over I mean I could 1:14:49 1 hour, 14 minutes, 49 seconds be off here and there but about 200,000 uh F now FI 26 1:14:56 1 hour, 14 minutes, 56 seconds uh they are India's second largest OEM and they they are out producing Hyundai with SUVs, SUVs only. They don't make 1:15:03 1 hour, 15 minutes, 3 seconds cars and they they are close to somewhere between 650 and 700,000 units. 1:15:10 1 hour, 15 minutes, 10 seconds So, their size has tripled in 4 years. 1:15:14 1 hour, 15 minutes, 14 seconds So, and we are their only four-wheel drive supplier. So, that's the you could say the uh tide that we are riding just now. 1:15:25 1 hour, 15 minutes, 25 seconds I can tell you Mahindra is the most exciting SUV company in the world right now. 1:15:33 1 hour, 15 minutes, 33 seconds Great sir. Thank you. Got sir. It's done. Thank you so much sir. 1:15:38 1 hour, 15 minutes, 38 seconds Thank you. The next question is from the line of Anurag from Art Ventures. Please go ahead 1:15:53 1 hour, 15 minutes, 53 seconds Mr. Please go ahead with your question. Your line is unmuted. Yes. Hi, thank you for the opportunity. 1:15:59 1 hour, 15 minutes, 59 seconds So, just on this uh Mahindra global pickup order, uh are these vehicles assembled in the South African facility 1:16:06 1 hour, 16 minutes, 6 seconds of Eminem or are these completely made up and exported from India? The reason I asked this is because there was some 1:16:13 1 hour, 16 minutes, 13 seconds talks of um additional duties being imposed on vehicle imports into South Africa. So just wanted to check on uh 1:16:22 1 hour, 16 minutes, 22 seconds how these things uh Mahindra is currently I think for South African market they do it in South Africa but 1:16:29 1 hour, 16 minutes, 29 seconds the rest of the world uh where they it's possible for them to uh export completely built units those are built 1:16:37 1 hour, 16 minutes, 37 seconds at their uh the the Scorpio pickup is built at their plant in Nasi in Maharashtra. 1:16:47 1 hour, 16 minutes, 47 seconds Okay. But for for South Africa, it's assembled in the South African facility. 1:16:51 1 hour, 16 minutes, 51 seconds Yeah. But but the South African market right now is quite modest. U they they Mahindra has markets in South America, North Africa, Southeast Asia, Australia. 1:17:02 1 hour, 17 minutes, 2 seconds So for these markets, the vehicles all go from India. 1:17:06 1 hour, 17 minutes, 6 seconds Sure. And for this specific order, these would this is uh only for the South African market, right? 1:17:12 1 hour, 17 minutes, 12 seconds No. No. the the the current order that we are talking about that we've been talking about in this call is from Indonesia right 1:17:20 1 hour, 17 minutes, 20 seconds 700 cr like the no no no that that will be built uh if my memory serves me 1:17:27 1 hour, 17 minutes, 27 seconds it's going to be built at Chakan I think right that one that one too yeah the new global pickup will be built at their new state-of-the-art facility 1:17:35 1 hour, 17 minutes, 35 seconds in Chakan in Pune okay sure thank 1:17:43 1 hour, 17 minutes, 43 seconds Thank you. The next question is from the line of Karan Gupta from ACMIL. Please go ahead. 1:17:52 1 hour, 17 minutes, 52 seconds Yeah. Hi. Uh not able. Uh yes sir. Go ahead. 1:17:59 1 hour, 17 minutes, 59 seconds Yeah. Uh can you uh tell us the total order book is on 1:18:07 1 hour, 18 minutes, 7 seconds December. There's some background noise coming from your end. Yes, sir. I'm not able to hear you clearly. 1:18:16 1 hour, 18 minutes, 16 seconds Hello. Yeah, it's better now. Go ahead. 1:18:19 1 hour, 18 minutes, 19 seconds Uh, so yeah, so the total order book uh as on quarter 3 if you can tell us. 1:18:29 1 hour, 18 minutes, 29 seconds uh yeah I think the u uh whatever uh Q3 performance we had I think we will be 1:18:37 1 hour, 18 minutes, 37 seconds able to sustain that uh in Q4 and going forward. Okay. Any quantification? 1:18:44 1 hour, 18 minutes, 44 seconds No. So there is there is no we don't see any uh uh risk uh the uh 1:18:53 1 hour, 18 minutes, 53 seconds the exact pattern in which it unfolds uh because we are ramping up right now for the Indonesian in order uh you can 1:19:00 1 hour, 19 minutes imagine to increase capacity of uh up to 6,000 units a year is not going to be possible in 1 month. So there's a ramp 1:19:09 1 hour, 19 minutes, 9 seconds up that we are on right now from February till uh uh February till June 1:19:15 1 hour, 19 minutes, 15 seconds uh and then it'll go at a flat plateau till December. So uh therefore the uh 1:19:23 1 hour, 19 minutes, 23 seconds whatever performance you saw in Q3 u we will be sustaining that going forward. 1:19:31 1 hour, 19 minutes, 31 seconds uh also what happens is the um the vehicle production capacity building that capacity at both TA and Myra is a 1:19:40 1 hour, 19 minutes, 40 seconds bigger challenge for them because not just for us it's just a transfer case they have to manage you know a gazillion different assemblies and components to 1:19:47 1 hour, 19 minutes, 47 seconds put that vehicle together and do it with top-notch quality because remember this is an export market in competition with 1:19:55 1 hour, 19 minutes, 55 seconds the Chinese and the Japanese and the Koreans so they have to do a super job uh and therefore that's going to take time and the uh as they sort out their 1:20:04 1 hour, 20 minutes, 4 seconds own bottlenecks uh that's how the schedules will unfold uh over the next 1:20:10 1 hour, 20 minutes, 10 seconds uh uh quarter to four to 5 months. So the exact nature uh is is difficult to 1:20:17 1 hour, 20 minutes, 17 seconds predict but it's safe to say that uh it will be a sort of soft ramp on on which the num the numbers will be going up. 1:20:31 1 hour, 20 minutes, 31 seconds Okay. Okay. Um, so is it for transfer case 9,000 uh units per month? Uh, the 1:20:39 1 hour, 20 minutes, 39 seconds capacity you have, right? 9,000 units per month. 1:20:42 1 hour, 20 minutes, 42 seconds Today, today we need to keep that capacity because uh you can just see that just the export demand is going to 1:20:50 1 hour, 20 minutes, 50 seconds be uh about 6,000 units. You know, 7,000 units is close to 6,000 a month. 1:20:58 1 hour, 20 minutes, 58 seconds And then in addition to that there there are other export markets plus the domestic requirement. 1:21:04 1 hour, 21 minutes, 4 seconds Okay. Okay. And 13 to 14 and a half thousand uh per quarter you are currently uh producing basically. So 1:21:12 1 hour, 21 minutes, 12 seconds it's basically 50 50% of uh capacity utilization currently to 50% you could say that. 1:21:22 1 hour, 21 minutes, 22 seconds Okay. Okay. And you can draw you can draw your inferences from that uh on what that means for uh profitability. 1:21:31 1 hour, 21 minutes, 31 seconds So uh maybe in two to three years if this uh can go up to 70 75% and we are utilizing uh optimum level. 1:21:41 1 hour, 21 minutes, 41 seconds So uh that uh is that the margins we can assume it will go up from 20% excluding 1:21:49 1 hour, 21 minutes, 49 seconds uh the other income to something around 25% on the precoid levels kind of thing. 1:21:57 1 hour, 21 minutes, 57 seconds Uh yeah I think you're making many assumptions. 1:22:00 1 hour, 22 minutes uh I mean that's basic assumptions and I think yeah you know the reason I say that is uh uh our ability to grow the transfer case market globally has its challenges. 1:22:12 1 hour, 22 minutes, 12 seconds Okay. 1:22:13 1 hour, 22 minutes, 13 seconds Uh we are confident but uh to sort of you know bet everything on that one horse would not be included which is why 1:22:22 1 hour, 22 minutes, 22 seconds we have u uh these other verticals as well because the the assets that we have 1:22:31 1 hour, 22 minutes, 31 seconds uh in manufacturing and assembly can be cross deployed. So we don't want to uh 1:22:38 1 hour, 22 minutes, 38 seconds sort of bet on any one single horse. uh so the ability to have four verticals and components thereof is what will give our business resilience. 1:22:50 1 hour, 22 minutes, 50 seconds So uh uh you're right. I mean if we are able to uh get to 70% 1:22:57 1 hour, 22 minutes, 57 seconds consistently utilization uh obviously the uh profitability will improve. But there is a caveat which is 1:23:06 1 hour, 23 minutes, 6 seconds that if we have to win business at that scale uh it may not be at the current uh 1:23:13 1 hour, 23 minutes, 13 seconds profit margins. He may have to uh there may be price pressures then uh that that comes because a lot of this will be at 1:23:21 1 hour, 23 minutes, 21 seconds the expense of somebody else. Uh and uh we know we are competitive 1:23:28 1 hour, 23 minutes, 28 seconds uh and you know before the Ukraine war broke out we were exporting transfer cases to Russia. uh we are ne in 1:23:36 1 hour, 23 minutes, 36 seconds negotiations uh you know in other parts of the world but somebody else is going to get affected and that somebody else uh could 1:23:44 1 hour, 23 minutes, 44 seconds then respond uh competitively. So uh this is a a dynamic situation and uh uh 1:23:52 1 hour, 23 minutes, 52 seconds it would not be wise and prudent uh to make a categorical statement uh uh on uh 1:23:59 1 hour, 23 minutes, 59 seconds you know business topline and profitability. 1:24:04 1 hour, 24 minutes, 4 seconds Uh okay fair enough. Fair enough. Uh just one on uh uh again on the total 1:24:11 1 hour, 24 minutes, 11 seconds total order book we have uh except this 70,000 uh transfer case order book what else I 1:24:19 1 hour, 24 minutes, 19 seconds mean in terms of quantification you can tell us that we have for the next maybe one or two years so that we can see the 1:24:28 1 hour, 24 minutes, 28 seconds visibility of the top line. So the the other one would be uh component exports uh to the United States uh 1:24:36 1 hour, 24 minutes, 36 seconds Europe and Mexico. We have very good visibility on what is happening there because we're getting very good RFQS. Uh 1:24:44 1 hour, 24 minutes, 44 seconds we're getting very good responses to the quotations that we are giving. uh and it is because of this that uh the top 1:24:51 1 hour, 24 minutes, 51 seconds purchasing management of uh one of the world's largest tier ones which you know Magna is a 40 billion uh dollar tier one 1:25:00 1 hour, 25 minutes they're larger than many OEMs in India um uh have invited us for a supplier 1:25:07 1 hour, 25 minutes, 7 seconds conference in Detroit to discuss and and you know they see us as a a strategic supplier 1:25:14 1 hour, 25 minutes, 14 seconds u uh we are in talks with uh Ford and GM M as well in the US and at the risk of 1:25:21 1 hour, 25 minutes, 21 seconds repetition, let me say that that is why we are looking at a presence in the US because we need to be engaged with them 1:25:29 1 hour, 25 minutes, 29 seconds uh in a more concentrated sustained manner and that will be possible only if we have uh presence in the uh United 1:25:37 1 hour, 25 minutes, 37 seconds States in the same time zone. Um so that is another market. Uh the other market 1:25:44 1 hour, 25 minutes, 44 seconds is uh EVs uh both in India globally um and uh uh I don't have the time now 1:25:53 1 hour, 25 minutes, 53 seconds to go into the uh technical kind of details but there's a lot of innovative stuff happening in our company uh which 1:26:00 1 hour, 26 minutes will enable us to be a very fast responder in product development. the EV market is going to be characterized by 1:26:07 1 hour, 26 minutes, 7 seconds speed. Uh, and if you apply the old IC templates, uh, you're not going to succeed in the EV industry. Tata Motors 1:26:16 1 hour, 26 minutes, 16 seconds is doing that. They're doing a great job. You know, we can do a better job and, uh, we are by working with them, we 1:26:24 1 hour, 26 minutes, 24 seconds are learning some valuable uh, uh, lessons. Uh, they are the by far the market leader today. So that uh EV 1:26:33 1 hour, 26 minutes, 33 seconds segment is one and the mother of all uh markets uh is the automatic transmission. Uh and as I mentioned in 1:26:41 1 hour, 26 minutes, 41 seconds my opening remarks uh we are working on a proof of concept. Uh we have a we have our road map. uh what we need to do is 1:26:51 1 hour, 26 minutes, 51 seconds uh back that first uh commercial order that will and our approach you know is going to be deep localization deep 1:26:58 1 hour, 26 minutes, 58 seconds localization of the type that we have done on EVs on transfer cases on synchronizers 1:27:06 1 hour, 27 minutes, 6 seconds uh on on on specialtity components that we make uh where we understand design testing manufacturing and if we bring 1:27:14 1 hour, 27 minutes, 14 seconds that approach uh our vision is to be a a deep uh to make automatic transmissions uh with deep indigenous technology. 1:27:24 1 hour, 27 minutes, 24 seconds Okay. 1:27:25 1 hour, 27 minutes, 25 seconds So that that that segment is really the mother of all opportunities because that will put us on track to cross,000 crores straight away. 1:27:36 1 hour, 27 minutes, 36 seconds Okay. Thank you. Thank you very much. 1:27:40 1 hour, 27 minutes, 40 seconds Thank you ladies and gentlemen. Due to time constraints that was the last question for today. I would now like to hand the conference over to management for closing comments. 1:27:51 1 hour, 27 minutes, 51 seconds No. So, uh yeah, I would just like to uh conclude by thanking uh uh you know our 1:27:58 1 hour, 27 minutes, 58 seconds stakeholders for the penetrating questions uh because these questions give us the opportunity uh to provide 1:28:05 1 hour, 28 minutes, 5 seconds clarification to to bring some color to otherwise you know and and to bring life to uh the the story and the na narrative 1:28:13 1 hour, 28 minutes, 13 seconds that we have. uh they are also important for my colleagues who are sitting here and listening in on this conversation 1:28:20 1 hour, 28 minutes, 20 seconds uh and to take some valuable uh insights from the questions that are raised. So I just want to say uh you know thank you 1:28:27 1 hour, 28 minutes, 27 seconds very much. We always look forward to these earnings calls because they're so stimulating and we go away refreshed 1:28:34 1 hour, 28 minutes, 34 seconds with a lot of ideas and insights. So uh I look forward to our next quarterly call and I'm sure it will be equally uh 1:28:42 1 hour, 28 minutes, 42 seconds productive and and engaging as this one was. So on a concluding note, thank you so very much. 1:28:51 1 hour, 28 minutes, 51 seconds Thank you. On behalf of Sentrum Broking Limited, that concludes this conference. 1:28:56 1 hour, 28 minutes, 56 seconds Thank you for joining us and you may now disconnect your lines.