Emmforce Autotech Ltd — Q4 FY26

Emmforce Autotech Ltd Q4 FY2025-26 Earnings Conference Call https://www.youtube.com/watch?v=mCGinTghACk Published: 3 weeks ago

0:03 3 seconds Ladies and gentlemen, good day and welcome to the Mforce AutoTech Limited H2 FI26 Earlings Conference call hosted by Go India Advisor. 0:13 13 seconds As a reminder, all participant lines will remain in the listenon mode and there will be an opportunity for you to ask questions after the presentation 0:20 20 seconds concludes. Should you need assistance during the conference call, please signal the operator by pressing star then zero on your touchstone telephone. 0:29 29 seconds Please note that this conference is being recorded. 0:33 33 seconds I will now hand the conference over to Miss Sakshi Sha from Go India Advisor for opening remarks. Thank you and over to you. 0:42 42 seconds Good afternoon everyone and welcome to the H2 FI26 earnings call of Empose Autotech Limited hosted by Go India 0:51 51 seconds Advisor. We have on the call Mr. Ashoke Meta sir, promoter and managing director. Mr. Aziz meta sir, executive 1:00 1 minute director and CFO. We must remind you that the discussion on today's call may include certain forward-looking 1:07 1 minute, 7 seconds statements and must be therefore viewed in conjunction with the risk that the company faces. May I now request the management to take us through the financials and the business outlook. 1:17 1 minute, 17 seconds Subsequent to which we will open the floor for Q&A. Thank you and over to you Ashukur. 1:39 1 minute, 39 seconds Please unmute from me. All right. 1:47 1 minute, 47 seconds Oh, sorry. I was on mute. So uh good afternoon everyone and thank you for joining the Emporic Limited earnings 1:54 1 minute, 54 seconds conference call to discuss our FI26 performance and business outlook. 2:00 2 minutes FI26 has been a defining year for Empor not only from the growth perspective but also from an execution standpoint. 2:08 2 minutes, 8 seconds We continue to scale our operations, deepen customer relationships and strengthen our manufacturing ecosystem. 2:15 2 minutes, 15 seconds This year, we undertook significant strategic capital initiatives aimed at strengthening our long-term nation ecosystem and preparing the company for the next phase of scalable growth. 2:26 2 minutes, 26 seconds These investments were focused on capacity creation, backward integration, automation, forging capabilities and 2:33 2 minutes, 33 seconds infrastructure enhancements across both the automotive and agri segments. 2:39 2 minutes, 39 seconds Importantly, a large part of this capex has been executed ahead of the revenue scale up making Empor operationally future ready 2:47 2 minutes, 47 seconds to cater to the increasing OEM requirements. 2:51 2 minutes, 51 seconds Larger export programs and new product categories without requiring the proportionate incremental investments in the near term 2:59 2 minutes, 59 seconds with newly commissioned capacities, enhanced in-house capabilities, and stronger manufacturing backbone now in place. We believe the company is 3:06 3 minutes, 6 seconds entering a new phase where operating leverage, execution efficiency and margin expansion can improve meaningfully as utilizations level increase. 3:18 3 minutes, 18 seconds Over the years, we have built EMOS as a specialized manufacturer of precision engineering niche drivetrain components primarily catering to four-wheel drive 3:26 3 minutes, 26 seconds and performance racing vehicles globally. 3:29 3 minutes, 29 seconds At the same time, we have strategically expanded into the agree segment, widened both our addressable market and product portfolio. 3:39 3 minutes, 39 seconds Today our product basket includes four-wheel drive locking hubs, spindles, specialized drive shaft yolks, axle assemblies, various differential parts, 3:48 3 minutes, 48 seconds hydraulic gear pumps, gear shifters, four shafts and gears, rotator components, for rotator blades and other 3:57 3 minutes, 57 seconds precision engineing products. Our integrated ventrication facility spread across approximately 150,000 square ft 4:04 4 minutes, 4 seconds in BI and Mach Pradesh supported by over 600 plus skilled manpower enables us to serve customers across 4:12 4 minutes, 12 seconds more than 20 countries backed by nearly three and a half decades of industry presence and relationships. 4:19 4 minutes, 19 seconds The strength of our man in manufacturing platform lies in our end to end integrated operations which include in-house design and engineering forging 4:27 4 minutes, 27 seconds of rifling components machining and precision mach finishing heat treatment and surface treatment assembly testing and quality control final dispatch to global customers. 4:39 4 minutes, 39 seconds This vertically integrated structure allows us to maintain quality consistency, improve turnover, turnaround timelines and enhance 4:46 4 minutes, 46 seconds operational efficiencies across the value chain. 4:50 4 minutes, 50 seconds An important strategic pillar of this integration journey has been our subsidiary AMOS Mobility Solutions Server Limited or EMS. 4:59 4 minutes, 59 seconds The subsidiary was established to strengthen our coging capabilities and support our expansion into the agreement segment. 5:06 5 minutes, 6 seconds We are pleased to share that EMSPL has completed first year of uh operation and has already achieved a turnover from cash losses a turnaround from cash 5:15 5 minutes, 15 seconds losses to a modest cash profit within the very first year itself. 5:20 5 minutes, 20 seconds This facility houses a 1600 tons bing significantly reducing a dependence on third party vendors for immediate manufacturing processes and helping 5:29 5 minutes, 29 seconds improve overall supply chain reliability and cost efficiency. It also houses a state-of-the-art fully automated rotator 5:37 5 minutes, 37 seconds blade managing setup with most of the major equipment from Japan and it is also equipped to manufacture agree equipments like rotators, super cedars, inter wheelers etc. 5:48 5 minutes, 48 seconds One of the key strengths of our business continue to be customers kickiness and pricing power. 5:54 5 minutes, 54 seconds A high contribution from our key customers reflects long-standing relationships built over years of execution, product quality, and repeat business rather than concentration risk. 6:05 6 minutes, 5 seconds We continue to see increasing orders participation from existing customers across programs. 6:12 6 minutes, 12 seconds From a capacity standpoint, the company currently has an installed capacity of approximately 350 crores split between 6:19 6 minutes, 19 seconds around 200 crores for automotive segment and 150 crores for agree segment. The current utilization levels remain at 6:27 6 minutes, 27 seconds about 50 to 55% in automotive and 8 to 10% in agree placing us in a strong operative leakage curve where 6:34 6 minutes, 34 seconds incremental growth can meaningfully meaningfully translate into margin expansion going forward. Our engineeringled expo approach continues 6:43 6 minutes, 43 seconds to remain our key differentiator. Ampost has an in-house R&D and design center equipped with the modern engineering and testing infrastructure. 6:52 6 minutes, 52 seconds We continue to invest nearly 2% of our revenue consistently towards innovation enabling product development, customization and continuous 6:59 6 minutes, 59 seconds improvement, continuous process improvements along with aligned with the evolving customer requirements from a business development perspective. 7:09 7 minutes, 9 seconds uh execution across the order pipeline remains robust during the year. Today we have a multi-year order book exceeding 500 crores providing strong medium-term revenue visibility. 7:20 7 minutes, 20 seconds The already secured 470 cr US export order has already entered into commercial production at full run rate and is expected to contribute 7:28 7 minutes, 28 seconds approximately 60 crores of annual revenue in FY27. 7:32 7 minutes, 32 seconds In addition, we have secured a long-term drivetrain supply order with an estimated annual opportunity of about 10.5 crores from for which the Pak 7:41 7 minutes, 41 seconds samples have already been submitted to the customer and the commercial production is expected to commence in Q3 7:48 7 minutes, 48 seconds financial year 27 this year. Another US order is expected to contribute growth to 10 crores annually. 7:55 7 minutes, 55 seconds What has been particularly encouraging is the speed of execution of these products. 8:00 8 minutes So during the year we successfully commissioned a dedicated green field facility for the US OEM with mass production commencing from 15th December 2025. 8:10 8 minutes, 10 seconds This reflects our ability to execute complex export oriented programs within aggressive timelines while maintaining quality and delivery commitments. 8:20 8 minutes, 20 seconds On the agree side as well the business has started gaining meaningful traction. 8:25 8 minutes, 25 seconds We have already secured TEA approvals for RTO parts and blades with commercial sales comments from January 26. 8:33 8 minutes, 33 seconds Simultaneously, we remain in active discussions with additional OEMs while also scaling our distributor 8:40 8 minutes, 40 seconds distribution domestic strategy across Maharashtra, Karnataka and Madhya Pradesh. 8:46 8 minutes, 46 seconds Importantly, Empost today is evolving beyond being only a niche drive component supplier. We are steadily transitioning from integrated 8:54 8 minutes, 54 seconds engineering OEM partner with capabilities spanning automotive agree and industrial applications. The successful launch of our proprietary 9:02 9 minutes, 2 seconds hydraulic lu pumps after nearly 5 years of focused R&D efforts is another important step in that direction and 9:10 9 minutes, 10 seconds reflects our long-term product development capabilities. Coming to the financial performance. 9:17 9 minutes, 17 seconds So financial year 26 revenue grew strongly to 113 crores that is a 27% growth year-over-year while the habitita 9:25 9 minutes, 25 seconds increased to 23 crores which is 28% year-over-year maintaining a healthy operating margins despite continued investments towards 9:34 9 minutes, 34 seconds the best expansion talent acquisition and future growth initiatives that remained at around 8 crores. The 9:41 9 minutes, 41 seconds 4-year revenue CHR is about 35% and four year AIA CH is around 27%. 9:48 9 minutes, 48 seconds So we are pleased that our financial year 26 performance remained broadly in line with the guidance shared earlier. 9:54 9 minutes, 54 seconds AITA margins remained healthy at around 20% while revenue for the year came in at 113 crores well within our guided range of 100 to 125 crores. 10:05 10 minutes, 5 seconds We would also like to address the movement in profitability during the year. The moderation in the pack was largely largely attributable to the 10:14 10 minutes, 14 seconds manpower hiring undertaken for the already secured project along with the higher depreation related to the EMPL 10:22 10 minutes, 22 seconds capex and capacity expansion initiatives. 10:25 10 minutes, 25 seconds These are growth oriented investments made ahead of revenue scale up particularly for the agree and automotive businesses. 10:33 10 minutes, 33 seconds From the balance sheet perspective, the company continues to remain comfortable with the net debt to equity ratio of 48x. 10:40 10 minutes, 40 seconds Working capital remained elevated during the year primarily due to the start of the sale of our new US OM customer in March 26. 10:50 10 minutes, 50 seconds Looking ahead, we remain optimistic about the medium-term outlook. Our focus areas continue to be scaling the agree division, expanding relationships with 10:58 10 minutes, 58 seconds tier one OEMs across the US, Europe and Asia, increasing OEM contribution within the revenue mix, enhancing margins 11:06 11 minutes, 6 seconds through operating leverage automation and in-house coing integration and simplifying the broader group structure 11:13 11 minutes, 13 seconds over time. For financial year 27 we are targeting revenue of approximately 165 crores from the automotive business and around 30 crores from the agree sector. 11:25 11 minutes, 25 seconds Further for FY28 we are aiming to scale overall revenues to nearly 240 crores with agree business contributing close to 50 crores. 11:35 11 minutes, 35 seconds What gives us competence in this outlook is the strong execution visibility from existing export programs increasing OEM 11:43 11 minutes, 43 seconds participation capacity readiness and gradual scale up of the agree vertical. 11:48 11 minutes, 48 seconds At the same time while driving growth we remain equally focused on maintaining financial discipline and operational efficiency. We continue to target 11:57 11 minutes, 57 seconds healthier beta margins in the range of 20 to 22% along with pack margins of around 10% supported by operating 12:05 12 minutes, 5 seconds leverage backward integration benefits and improved scale efficiencies over coming years. We remain confident about 12:12 12 minutes, 12 seconds the long-term growth trajectory of business supported by strong auto visibility, newly commissioned capacities and expanding customer 12:20 12 minutes, 20 seconds relationships across both automotive and ag segments. improving execution capabilities. We believe Mforce is well positioned for the next phase of growth. 12:31 12 minutes, 31 seconds With that, I now hand over the call to the moderator. Thank you. 12:38 12 minutes, 38 seconds Over to you. Yes, sir. Ladies and gentlemen, we will now begin the question and answer session. Anyone who wishes to ask a question may press star 12:47 12 minutes, 47 seconds and one on the touchstone telephone. If you wish to remove yourself from the question queue, you may press star and 12:54 12 minutes, 54 seconds two. Participants are requested to use their handsets while asking a question. 12:59 12 minutes, 59 seconds Ladies and gentlemen, we will wait for a moment while the question Q assembles. 13:07 13 minutes, 7 seconds We take the first question from the line of Jan Cha from RTL Investments. Please go ahead. 13:19 13 minutes, 19 seconds Jan, please unmute your line from your end and proceed with your question. 13:24 13 minutes, 24 seconds Yeah. Hi. Uh good afternoon and uh thanks for the opportunity. Uh my first question is uh in this uh in the last 13:32 13 minutes, 32 seconds financial year FI26 what was the final revenue contribution of the large export order? 13:39 13 minutes, 39 seconds uh about five and a half to six week. Okay. 13:44 13 minutes, 44 seconds So this was only in the month of practically in the month of March only. 13:49 13 minutes, 49 seconds Okay. Got it. Got it. So uh that is the reason why uh you know our margins have taken a little bit of a hit because the 13:56 13 minutes, 56 seconds revenue contribution is only 6 cr and we have seen uh the employee cost for kind of a larger period. 14:03 14 minutes, 3 seconds Absolutely. because all the people were appointed because we came into production in December but of course the initial hiccups when it happens when a 14:11 14 minutes, 11 seconds new project is to be started they were taking some time from the customer's end and we could get the final go ahead only you know in the month of end of February 14:20 14 minutes, 20 seconds and then onwards we are in full throttle mode got it so this entire increase in employee cost from first half to second 14:27 14 minutes, 27 seconds half which is 6 cr to roughly 8 crores is largely driven by this export order 100% Got it. Got it. 14:35 14 minutes, 35 seconds If not 100% I would say 90% maybe a few uh top end people are also hired. So as we are growing so we are adding some 14:43 14 minutes, 43 seconds good uh manpower uh to look for our future expansions. 14:49 14 minutes, 49 seconds Got it. Got it. And if I adjust for this kind of 6 cr in the second half number 14:56 14 minutes, 56 seconds then standalone uh or even console revenues have been kind of you know stagnant at that second half FI25 run 15:05 15 minutes, 5 seconds rate. So even on Y or half over half whichever way one looks at it there is no underlying growth in the base business. What is the reason for the same? 15:15 15 minutes, 15 seconds Because typically you know the customers were trying to adjust some sort of inventories as we understand because there were tariffs which customers were 15:22 15 minutes, 22 seconds paying. So there is a 25% tariff that customers are paying and that was basically within their cash flows and 15:30 15 minutes, 30 seconds they came to the point that now the tariffs are continuing. So they thought that okay it'll be good that we basically do some adjustments in 15:37 15 minutes, 37 seconds inventory. So everybody was basically trying that okay uh let us rationalize some inventories and uh that is how it is and uh now again we are back to uh 15:47 15 minutes, 47 seconds full throttle. So that is basically the thing. 15:50 15 minutes, 50 seconds Got it. So now that tariffs have kind of come down and also the you know Indian currency has also depreciated quite a bit. So there should be some forex 15:59 15 minutes, 59 seconds benefit as well. How do you see growth uh going forward on the base business if C1 kind of you know removes the export 16:07 16 minutes, 7 seconds the large export order out of the picture for for a moment? You see uh we were there uh in US uh I 16:15 16 minutes, 15 seconds think we came back probably week 10 days ago only. So we had a good two weeks program meeting all the customers trying to take the P and uh honestly speaking 16:24 16 minutes, 24 seconds the response over there was really very positive. 16:27 16 minutes, 27 seconds quite uh okay in terms of we were in fact doubtful that whether the market is actually being hit by some recession or 16:35 16 minutes, 35 seconds something but uh none of the customer was showing anything like they see any sort of thing like that and the orders are also uh continuing rather uh more 16:44 16 minutes, 44 seconds than what we expected. So we don't really see so far we don't really see any challenges uh in terms of customers uh requirements 16:53 16 minutes, 53 seconds and their requirements are growing and they're pushing us uh for the numbers. 16:59 16 minutes, 59 seconds Got it. Got it. That is encouraging to know. Just one last question on the agree side. Uh again uh first half to second half the revenue run rate is 17:08 17 minutes, 8 seconds broadly similar at about 4 crores. Um and you are planning 30 crores in FI27. 17:14 17 minutes, 14 seconds So what is kind of giving you that visibility that you know you you can scale up from a 4 cr half yearly run 17:21 17 minutes, 21 seconds rate to you know 30 cr for the full year. It seems like a very aggressive scale up. So what is giving you that visibility 17:29 17 minutes, 29 seconds you know what practically last year we started only towards July. 17:35 17 minutes, 35 seconds So, so that was not even full year and that was the first year where you know we got the customer but you see every 17:42 17 minutes, 42 seconds segment uh up to Diwali is a full season and after that the demand slows down. 17:49 17 minutes, 49 seconds So typically uh what we could get was only 3 4 months and that was initial but now we have those that is one. Second is 17:58 17 minutes, 58 seconds uh like we started off with the blades the people were taking time to understand like testing field testing. 18:04 18 minutes, 4 seconds So all those things were also going on and uh like as I said now Pepe has finally you know approved they have done all their testings and now they are 18:12 18 minutes, 12 seconds giving us a go ahead. So they are buying now consistently even this month also their orders and next month they are growing. So over a period of time now they will keep growing their business 18:20 18 minutes, 20 seconds with us because uh we are the best bet available with them the nearest source available to them and then apart from this uh there are certain distributors 18:29 18 minutes, 29 seconds with whom we tied up whose volumes are now initially they did the trial orders but now their orders are consistently coming in. So once the product starts 18:38 18 minutes, 38 seconds getting into the market then the uh noise starts and you know you start generating demand. Apart from this, we 18:45 18 minutes, 45 seconds are also now in active discussions with uh a few very big OEMs uh with whom you know we are quite 18:52 18 minutes, 52 seconds hopeful that we will get through and uh that should also give us good business. 18:57 18 minutes, 57 seconds So all along you know if I ask me I mean there are very positive discussions going on and all along we see the traction and we see that 30 number should not really be a far-fetched number for us. 19:08 19 minutes, 8 seconds Sorry. And this active discussion with OEMs uh is on the blade blade as well as rotated contact mentation. 19:17 19 minutes, 17 seconds Okay. Got it. And this TF blade order. What is the size of the order? 19:22 19 minutes, 22 seconds Typically TAFE is going to start with us uh for a business of about uh 19:29 19 minutes, 29 seconds 15 lakhs per month but then they have said that we will basically gradually keep growing it. So their monthly requirement is about uh 45 to 50 lakhs. 19:41 19 minutes, 41 seconds So they have started with 30% share of business. 19:44 19 minutes, 44 seconds So typical annual business they have is about to course for blade itself. 19:50 19 minutes, 50 seconds Okay. So at 15 lakh volume per month is sorry at at 15 lakh volume per month the business is 4 cr peranom. 20:00 20 minutes No 15 lakh is our share of business to start with. 20:03 20 minutes, 3 seconds Yeah. So this 4 cr peranom is your share or that their total requirement basically their their requirement is about let us say 35 you know three and a half cr no sorry 35 lakhs per month. 20:16 20 minutes, 16 seconds So they are going to grow our share of business in the coming months. So they have just started. So now they are going to install then they will have you know 20:25 20 minutes, 25 seconds because they would be having some you know inventory from the present uh vendor also. Plus anybody who you know 20:33 20 minutes, 33 seconds starts with in India they would always add that okay we would like to see that okay whether they are able to give the deliveries or not and once we see the deliveries happening then they repeat 20:41 20 minutes, 41 seconds bigger orders because all those things basically you know those happen and over a period of time they will grow our business to 70 80% market share. 20:50 20 minutes, 50 seconds Got it. Got it. And plus we have like plus we have like our own distributors with our own brand which are now established in the markets of you know Maharashtra and uh NMP and uh Karnataka. 21:03 21 minutes, 3 seconds So all that is going on and these are actually very good belts. So all that is already going on and everything is going to you know take some shape. 21:12 21 minutes, 12 seconds Got it. Got it. Uh this is very useful. 21:14 21 minutes, 14 seconds I have a couple of more questions but I'll come back in the queue. Thanks. Okay. 21:19 21 minutes, 19 seconds Thank you. We take the next question from the line of Helen Patel from Abangi and Abhangi LLP. Please go ahead. 21:28 21 minutes, 28 seconds I am able. 21:31 21 minutes, 31 seconds Yes, a little slow but can you speak a little louder? 21:35 21 minutes, 35 seconds Uh yes sir. Uh my thanks uh for the opportunity uh straight forward. I do apologize to interrupt you there. 21:42 21 minutes, 42 seconds Could you please use your handset and proceed with your question? 21:50 21 minutes, 50 seconds Sir, the voice is a little low. Can you use your handset and uh ask the question? Okay. 21:59 21 minutes, 59 seconds Yeah, sir. I am sir. 22:02 22 minutes, 2 seconds Yes. Now you're uh Okay. Uh thanks for the opportunity, sir. Uh couple of questions. The first question is uh regarding the working 22:11 22 minutes, 11 seconds capital pressures uh as seen by uh inventory and uh dattors uh uh increased in financial 26. So based on your guidance regarding financial year 27 28. 22:23 22 minutes, 23 seconds So what is and how much additional working capital funding funding will be required if revenue reaches say for 22:30 22 minutes, 30 seconds example 225 cr and like that you see uh basically we already have the 22:38 22 minutes, 38 seconds working capital you know uh sanctioned from the bank so that's not really a challenge 22:45 22 minutes, 45 seconds so since working capital is going to be required for sure because when we are into the market of US and the transit time is also 2 months So definitely the 22:54 22 minutes, 54 seconds working capital cycle is required which is there. So we cannot deny this. But of course we already have uh very good because for export government is really 23:02 23 minutes, 2 seconds giving very good uh credit facilities up to 6 months. So there is no issue in terms of funding the working capital. 23:10 23 minutes, 10 seconds Okay. Got it sir. And another question is regarding as you presented company 23:17 23 minutes, 17 seconds wants to go through OEM business uh for financial year 2728. 23:22 23 minutes, 22 seconds So is there any uh margin pressure or like that because of OEM business? 23:28 23 minutes, 28 seconds You know what uh the type of business we prefer to do is not generic OEM business. We try to do a sort of niche 23:35 23 minutes, 35 seconds business where uh parts are not really simple. Okay. 23:41 23 minutes, 41 seconds So those those businesses basically don't get us the pressures. So uh typically you know we just write preferred do that. 23:52 23 minutes, 52 seconds Okay sir. And uh next uh question is uh what is the management confidence that means revenue can scale from present 24:01 24 minutes, 1 second level to say 250 cr within a shorter period of time and what is based on your 24:07 24 minutes, 7 seconds uh operational risk top three risk that could delay our financial year 27 or financial year 28 guidance achievement. 24:18 24 minutes, 18 seconds You see [clears throat] honestly speaking you know those are very generic risk for which are there for every business. I would say it is not like that okay any risk would be for 24:27 24 minutes, 27 seconds us. So there is nothing specific that uh I would say that okay this could be a risk that could really slow down our 24:35 24 minutes, 35 seconds things because ultimately India if you see the when we are into the exports market so the the whole world is 24:44 24 minutes, 44 seconds basically now looking into India as a supplier because this is the only lowc cost country now people are not really looking at China they've already had 24:52 24 minutes, 52 seconds enough and now China is not something which is cheaper in everything and then on top of it even if it's a 25:00 25 minutes little cheaper the tariffs make it quite unviable because there are uh much higher tariffs on Chinese products. So I 25:10 25 minutes, 10 seconds believe honestly as it is we don't really see but if there is a slowdown all across in the world economy and we really don't know if there is a havoc 25:18 25 minutes, 18 seconds falling so we don't know nobody knows but then it is going to be affected you know affecting everyone not only us 25:27 25 minutes, 27 seconds okay okay thank you sir yeah okay yeah thank you we take the next question from 25:35 25 minutes, 35 seconds the line of varun Aurora from MK Global finan financial services. Please go ahead. Hello. Am I audible? 25:44 25 minutes, 44 seconds Yeah. A little louder would be better, sir. Uh just please sir. Is it better? Yes sir. 25:53 25 minutes, 53 seconds Yes. Thank you sir. So just a small question. So out of this 500 order book, how much is executable in FI27 and FI28? 26:03 26 minutes, 3 seconds So practically sir this is about 60 crores perm now. Okay. Right over the next eight years. 26:13 26 minutes, 13 seconds So another thing that on margin. So how your voice is your voice is breaking sir. 26:19 26 minutes, 19 seconds Your voice is just that sir. 26:30 26 minutes, 30 seconds Yes. So how uh how sustainable this margin is this 20 or 20% odd uh is the 26:38 26 minutes, 38 seconds is there any dampness we are about to see in F27 since a lot of companies auto specifically and even auto actually are 26:48 26 minutes, 48 seconds giving this uh sort of uh margin uh seen key you know there's some dampers we are going to see because of this crude uh 26:55 26 minutes, 55 seconds oil you know uh pressure and as well as this war uh you know so that's a pressure is creating on several 27:03 27 minutes, 3 seconds companies. So what's your guidance on that part sir? Are you seeing this thing or uh the second part of this question 27:11 27 minutes, 11 seconds for the same that in the in these few months now May is about to end how the demand is going on uh you know in the 27:19 27 minutes, 19 seconds oilians as well as replacement is happening with you guys that's uh my question sir so Mr. Warun uh first of all I'll answer 27:27 27 minutes, 27 seconds your last question. Right now we are over busy. 27:33 27 minutes, 33 seconds So there is no there is no shortage of orders that we have seen from any corner so far. 27:41 27 minutes, 41 seconds So we don't really see any dampness so far. Nothing as I said that I just visited the customers also. I couldn't 27:48 27 minutes, 48 seconds really see anything coming in from their side. The things seem to be going pretty fine there. So all in all I don't really 27:56 27 minutes, 56 seconds see anything uh at least for our business I don't really see anything uh negative uh because after market is also doing good we have very good orders 28:04 28 minutes, 4 seconds generally at this time sometimes we think that there'll be less but we are seeing good and uh OEM business also as 28:12 28 minutes, 12 seconds I said it is going full cottle so there is no we every month we are doing five plus 28:21 28 minutes, 21 seconds okay it is and so on the margin that you can also on the margin also we don't really see any rather I I I don't really see I 28:30 28 minutes, 30 seconds would say if you see the you know cost of manufacturing is basically reduced if you see overall it is only because of the manpower cost we are seeing a drag 28:39 28 minutes, 39 seconds otherwise and that to because the the new project was started but the manpower was you know appointed and the cost was 28:46 28 minutes, 46 seconds there in the second half otherwise we seen the margins to be better only okay sir Sir and uh lastly if you can 28:55 28 minutes, 55 seconds give uh you know the numbers on revenue mix you know how much uh OBMs are giving to you and replacement 29:02 29 minutes, 2 seconds and uh any other uh any other product you are venturing into any other uh you know uh thing you're falling into sir 29:11 29 minutes, 11 seconds that's my that will be my last question thank you sir uh typically we right now want to consolidate ourselves into the business 29:19 29 minutes, 19 seconds that we're doing because right now we are into the right line where we need to go deep and expand. 29:26 29 minutes, 26 seconds So we don't uh feel like that we need to get on to uh any new product category in 29:33 29 minutes, 33 seconds the next uh one year at least. We will see review as we go forward. 29:39 29 minutes, 39 seconds Uh so that part is there and what was your next question? 29:47 29 minutes, 47 seconds So revenue mix uh revenue mix revenue mix uh revenue mix uh so I think it is 29:55 29 minutes, 55 seconds there in the presentation also but it is uh we are expecting that uh in the automotive business we should be having 30:04 30 minutes, 4 seconds about uh 40% business coming in from OANS by the end of this year. 30:14 30 minutes, 14 seconds Okay sir thank you very much. Yeah. All right. 30:19 30 minutes, 19 seconds Thank you. We take the next question from the line of Himancho Bisani from Pinpoint X Capital. Please go ahead. 30:28 30 minutes, 28 seconds Um yeah. Hi sir. Thanks for the opportunity sir. In the opening remarks you mentioned that uh you know we are sitting on a lot of operating in the 30:36 30 minutes, 36 seconds bridge uh as current facility can do a top 10 of around 350,000 we are at 410. 30:43 30 minutes, 43 seconds So sir on the uh so most of the optic would be coming from the auto side but uh sir in the new export order that you 30:50 30 minutes, 50 seconds have given of around 60 crores per year if I look at that and the FY27 presentation in the FY27 numbers that 30:58 30 minutes, 58 seconds you have given in the presentation I think the base growth that is not there in the business can you explain that 31:05 31 minutes, 5 seconds uh remind you uh what we have just tried to do is to be conservative okay Yeah, because the numbers are quite 31:14 31 minutes, 14 seconds obvious all that is there. So those numbers are there and they are already coming in but the only real but the only reason is 31:22 31 minutes, 22 seconds but the only reason is you know with these numbers we are talking about more than 70% 73% growth right now 31:30 31 minutes, 30 seconds right so on the yeah sorry yeah so sometimes what happens is when you try and project more 31:39 31 minutes, 39 seconds growth people try to believe that this is unbelievable so we just try to remain uh conservative here and see let the 31:46 31 minutes, 46 seconds people see what all is happening. So I think the numbers themselves are going to speak because now it is not a matter of that I have to tell that okay we are doing now everything we started. 31:58 31 minutes, 58 seconds Yeah, I understand that sir. But on the number just on that number on the presentation side 165 cr that you have estimated for the FI27 and auto business 32:07 32 minutes, 7 seconds right and 105 that you did this year. So 60 cr in session is just the export order right that is there is no so that is so there is no 32:16 32 minutes, 16 seconds base there is no growth in the base number x of that export order is that you have projected so that is what I said that is where I'm 32:25 32 minutes, 25 seconds saying that we kept ourselves conservative right that's the reason I said we are conservative the numbers we feel that 32:34 32 minutes, 34 seconds they're going to be much more but the question is right now talking of those numbers you know and Then ultimately you know then saying that okay maybe we 32:42 32 minutes, 42 seconds could or not perform by 5 crores 10 crores. It is better that we tell you later on that okay we outperformed by 20 later. 32:50 32 minutes, 50 seconds I think that will give you happiness because when you if anybody is investing if you is investing based on these numbers they would feel happy if the numbers are better later on. 33:01 33 minutes, 1 second Fair sir. Um the second question on the agri side um you mentioned to the previous participant that uh you know 33:08 33 minutes, 8 seconds the Diwali season before till Diwali season it's very much uh the part of the business and uh you're also seeing that 33:17 33 minutes, 17 seconds you have some conversations going on with some larger players so the majority of that 30 cr should come in the Q1 Q2 33:24 33 minutes, 24 seconds is what we can assume uh not necessarily it is not that the business stops after that but of course it slows down as I Right. 33:33 33 minutes, 33 seconds I mean this is right now you know basically it is uh so we can always expect you know uh reasonable numbers coming but it is a growth that is going to happen. 33:44 33 minutes, 44 seconds Okay. 33:45 33 minutes, 45 seconds So the sale doesn't stop. It is basically you know some states are having this season some are having more. 33:50 33 minutes, 50 seconds So that is how it happens. And sir when do we say we are in you know um good stages of formation what do 33:57 33 minutes, 57 seconds apart from this apart from this sorry 33:59 33 minutes, 59 seconds sorry sorry sorry sorry sorry sorry 34:07 34 minutes, 7 seconds always throughout the year. Okay, understood. Understood, sir. Yeah. 34:11 34 minutes, 11 seconds And so when uh on the conversion side you were saying um how how can you throw some light on the conversion how 34:18 34 minutes, 18 seconds advanced these talks are and how are we expecting some orders? 34:23 34 minutes, 23 seconds Well, honestly there are uh quite good traction that we are seeing. We are in good discussions with the people. That is all I can tell you. 34:32 34 minutes, 32 seconds So at this point I may not really be in a position to declare too much but of course uh we are we are looking into some uh good things to happen. 34:44 34 minutes, 44 seconds Understood. Understood sir. Thank you so much and all the best. Pleasure sir. Thank you. 34:49 34 minutes, 49 seconds Thank you. We take the next question from the line of Prates Va from Mission Street India. Please go ahead. 34:57 34 minutes, 57 seconds Hello sir. Hello. 35:00 35 minutes uh you you laid out very strong guidance for the coming year in FI28 uh what is it driving this guidance and what is the 35:09 35 minutes, 9 seconds margin expectation under this guidance uh sir margin we are expecting the same 35:15 35 minutes, 15 seconds 10% that and 20% a big that is what we basically uh are seeing very clearly 35:23 35 minutes, 23 seconds Mhm. And uh when it comes to you know uh the revenue number the you know that we 35:29 35 minutes, 29 seconds are seeing so revenue practically you know as I think mentioned you can very well see that uh uh this is the number 35:37 35 minutes, 37 seconds that we have already started uh driving not something that we are going to or we are going towards. So we are already 35:45 35 minutes, 45 seconds started in that direction. We are already doing 12 cr business for the new business. And then there is a new business of about 10 12 crores for 35:52 35 minutes, 52 seconds whiskey samples are already there with the customer. So that business is expected to be starting in Q3. So there 36:00 36 minutes also there is going to be some business coming in and that business will become fully next year. Then there is a business of hydraulic pumps which is uh 36:08 36 minutes, 8 seconds starting up this year and then there are other businesses which were signed up. So which are coming into production now. 36:15 36 minutes, 15 seconds So they will keep coming into production over a period of time. So all those things combined together we don't really see any challenges in the revenue projections that we have given. 36:26 36 minutes, 26 seconds Okay. Yeah. Wish you all the best. Thank you. Thank you sir. Thank you. Thank you. 36:34 36 minutes, 34 seconds We take the next question from the line of Ashish Kandelwa, an individual investor. Please go ahead. 36:43 36 minutes, 43 seconds Hello. Hello. Am I audible? 36:51 36 minutes, 51 seconds Yes sir, you are. 36:53 36 minutes, 53 seconds Yeah. So, hi sir. Uh my question on the subsidiary side. So, we were in uh planning to merge that uh subsidiary. 37:01 37 minutes, 1 second What is the agenda for that? 37:04 37 minutes, 4 seconds uh it was not the subsidiary is there it is basically our sister company sorry company so that that work is basically 37:13 37 minutes, 13 seconds going on so uh the idea is we are uh you know as we have mentioned in our presentation also that by all by all 37:22 37 minutes, 22 seconds means we are going to merge it you know immediately after we are on the main board but uh uh there is a very high possibility that we'll give you a 37:31 37 minutes, 31 seconds surprise uh uh in the coming few months. 37:36 37 minutes, 36 seconds Okay sir. And on uh so I just missed the projection as well. So did you give any projection? Last time I think we made it 37:44 37 minutes, 44 seconds was around 200 crores to guided for this year. So is it same we can expect or is there any change? 37:52 37 minutes, 52 seconds Uh it is 190 crores that we have given for this year sir 195. 37:58 37 minutes, 58 seconds And in this two months are we in line going with that 190 so proportionately it like yes yes things are going fine. 38:08 38 minutes, 8 seconds Okay great and agree I missed you. So I think we we had planned for 40 kores this year if I'm recalling correctly. 38:18 38 minutes, 18 seconds 30 30 kores. Okay. And for a 27 agree business including forging is 30 K. 38:27 38 minutes, 27 seconds Yes sir. 38:28 38 minutes, 28 seconds Last time I think he guided around 40 K now or 40. I think it was 30 only. 30. Okay. Yeah. 38:36 38 minutes, 36 seconds So 160 from the auto side and then 30 K for this. 38:40 38 minutes, 40 seconds So we are seeing 165 from the auto side and 30 from the agree. Okay. Okay. 38:49 38 minutes, 49 seconds Thank you sir. Right sir, most welcome. 38:53 38 minutes, 53 seconds Thank you. We take the next question from the line of Jetan Chavela from RTL Investments. Please go ahead. 39:02 39 minutes, 2 seconds Yeah. Hi. Uh thanks for the opportunity again. Um so uh first question is uh you 39:09 39 minutes, 9 seconds said 40% OEM contribution in FI27. Now as you look let's say even two three years outer from FI27 39:18 39 minutes, 18 seconds um do you see the OEM contribution going up further so is that going to be a focus area or how do you see the business mix evolving 39:26 39 minutes, 26 seconds uh I would say sir we can expect OEM contribution to be in the range of 60% going forward as we see yes 39:37 39 minutes, 37 seconds got it so you expect more OEM or mod orders going forward of course Yes. 39:43 39 minutes, 43 seconds Got it. Now, uh coming back to the replacement side, uh you know the percentage numbers that you've given uh suggest that the replacement business 39:51 39 minutes, 51 seconds has largely you know the growth has been a little bit muted uh this year and I think you mentioned that that is because 40:00 40 minutes of some of the inventory uh you know nationalization done by uh one or two of your large clients. Now as you look at 40:09 40 minutes, 9 seconds uh the first half of this year, are you seeing business starting to come back or is this inventory rationalization still a work in progress? 40:17 40 minutes, 17 seconds Actually s the inventory rationalization is still going on but at the same time the orders are also they have also flown 40:25 40 minutes, 25 seconds in uh pretty well. That's a surprising thing. So these orders are done for new parts. 40:33 40 minutes, 33 seconds No regular parts. So while you know inventory rationalization is not something you know basic sometimes you know basically if you're holding an 40:40 40 minutes, 40 seconds inventory of let us say uh 90 days in your warehouse or 60 in your warehouse maybe you decide that okay we will reduce it by 15 days 20 days to reduce 40:50 40 minutes, 50 seconds the impact of cash flows but then uh then we were expecting that orders will slow down but some items where we see that the orders have really 40:59 40 minutes, 59 seconds come in uh pretty quickly right in the beginning of the year which we were not expecting because we were hearing about 41:05 41 minutes, 5 seconds the inventory you know things and we see that the demand seems to be there that is why they're basically buying as well. 41:13 41 minutes, 13 seconds Is this kind of good? Sorry. 41:17 41 minutes, 17 seconds Is this kind of some share gain that you might be seeing from uh you know other country suppliers to to yourselves? 41:24 41 minutes, 24 seconds Sir uh see the regular part that we're doing. We are 100% suppliers. Okay. 41:30 41 minutes, 30 seconds So ultimately our customers selling to their customer they may be getting some more share of business. I don't know. 41:38 41 minutes, 38 seconds Got it. Yeah. 41:41 41 minutes, 41 seconds And on the hydraulic gear pump, you know, that's uh something that you've highlighted in the presentation in a big way as a uh as a you know key product. 41:50 41 minutes, 50 seconds How do you see that scaling up over the next two three years? I know to start with it's small but how do you see it scaling up? 41:57 41 minutes, 57 seconds Honestly, this is uh you know practically we are expecting this to become a separate division for us for hydraulics. 42:06 42 minutes, 6 seconds But right now we are keeping it low. We are not showing any numbers for that because we are letting this go slow because this is a big project but still 42:15 42 minutes, 15 seconds of course going forward this is going to be a good thing for us. 42:20 42 minutes, 20 seconds Got it. Got it. And with this uh you know west Asia war have you seen any impact on your freight cost or freight 42:27 42 minutes, 27 seconds time you know the time taken to no sir basically not even rather all our shipments are reaching on time honestly 42:35 42 minutes, 35 seconds and uh freight also is not really uh drawn up so much as we were expecting. 42:41 42 minutes, 41 seconds So there has been a very minor increase in paid cost but uh at the same time the revenue the you know the proportionate 42:49 42 minutes, 49 seconds growth that we're getting in terms of dollars has been much better. So we so of course the prices of things have gone up we understand that but we are able to 42:58 42 minutes, 58 seconds mitigate everything and still be much better off with the dollar prices today. 43:05 43 minutes, 5 seconds Exactly. And when I look at the consult balance see there is a 5 on goodwill that pertains to what? 43:11 43 minutes, 11 seconds Goodwill is basically sir uh the difference basically because of the two balance sheets. 43:19 43 minutes, 19 seconds So it is basically when you do consolidation of the two companies so the minority stakeholder or something like that basically is shown as a good way something like that. 43:29 43 minutes, 29 seconds Got it. Got it. No worries, I'll inter thanks a lot for the opportunity. Thank you, sir. 43:38 43 minutes, 38 seconds Thank you. We take the next question from the line of Hen Patel from Abangi and Abangi LLP. Please go ahead. 43:48 43 minutes, 48 seconds Yes. Uh thanks for opportunity again. Uh sir my uh first question is uh regarding please uh can you tell us uh based on 43:55 43 minutes, 55 seconds our history uh what we can expect for asset turnover for financial 27 and 28 sir 44:03 44 minutes, 3 seconds uh asset turnover sir if you look into it right now you know uh financial year 44:11 44 minutes, 11 seconds if I to give you a consolidated thing then we can expect this to be three times 44:19 44 minutes, 19 seconds this here and uh if you look into the next year then this is going to be maybe three and a half to four times but this will keep growing over the years. 44:32 44 minutes, 32 seconds Okay. Okay. Thank you. 44:33 44 minutes, 33 seconds And I'm giving and I'm giving you this number I'm giving you this number on gross value not on the net. 44:40 44 minutes, 40 seconds Okay. Got it. Got you sir. Thank you. 44:42 44 minutes, 42 seconds And another question is sir ain on working capital side uh as you said that it will be funded through short-term 44:50 44 minutes, 50 seconds capital so uh is it clear right means not required to dilute equity or like that? 44:56 44 minutes, 56 seconds No no no no sir okay and again sir on working capital uh is there any uh means uh other than bank 45:03 45 minutes, 3 seconds financing are we seeing any uh sourcing like factoring and all like that and any possibility? 45:10 45 minutes, 10 seconds Yes, we will be looking into that as well, sir. 45:13 45 minutes, 13 seconds Okay. Okay. Thank you so much. Thank you so much, sir. Welcome, sir. Okay. Thank you. 45:20 45 minutes, 20 seconds Thank you. Participants who wish to ask a question, please press star and one. 45:31 45 minutes, 31 seconds As there are no further questions from the participants, I now hand the conference over to the management for their closing comments. 45:40 45 minutes, 40 seconds So thank you so much everyone for uh tolerating us for all this year uh of turbulent times of tariff and uh I feel 45:49 45 minutes, 49 seconds proud that we could still show a growth of this 27% during this time and uh I can only assure you we can only assure 45:57 45 minutes, 57 seconds you that going forward you will see things going better and better only because now uh everything is behind us 46:04 46 minutes, 4 seconds and the projects are right now into the execution stage. stage where we are just executing and you have to see the numbers coming in. So you have waited 46:12 46 minutes, 12 seconds for 2 years but I hope uh the results are going to be good and worth waiting sir and thank you so much for spending 46:19 46 minutes, 19 seconds this one hour uh of listening to us and uh interacting with us. I'm sure all of you are here because you really have 46:27 46 minutes, 27 seconds serious interest in our business. Thank you so much. Thank you on behalf of Go India Advisor. 46:35 46 minutes, 35 seconds That concludes this conference call. 46:37 46 minutes, 37 seconds Thank you for joining us. And you may now disconnect your lines.