Filatex India Limited — Q4 FY26

Filatex India Ltd Q4 FY2025-26 Earnings Conference Call https://www.youtube.com/watch?v=WRW_3EFP1uo Published: 9 days ago

0:01 1 second Ladies and gentlemen, good day and welcome to the Filex India Limited Q4 FI26 conference call hosted by Branding 0:10 10 seconds Edge. As a reminder, all participant lines will be in the listen only mode and there will be an opportunity for you to ask questions after the presentation 0:18 18 seconds concludes. Should you need assistance during the conference call, please signal an operator by pressing start then zero on your touchstone phone. 0:28 28 seconds Please note that this conference is being recorded. 0:32 32 seconds I now hand the conference over to Miss Jani Kankaria from branding edge. Thank you and over to you ma'am. 0:40 40 seconds Thank you. Good evening everybody and welcome to Filateex India Limited's earnings call to discuss the Q4 and FI26 results. We have on call with us Mr. 0:49 49 seconds Madu Suzan Bhager chairman and managing director. Mr. Ashoke Chan, chief visionary officer, Mr. Mr. Nitan Agraal, 0:56 56 seconds Chief Financial Officer, and Mr. Vidanch Beria, Vice President, corporate strategy. We must remind you that the discussion on today's call may include 1:05 1 minute, 5 seconds certain forward-looking statements and must be therefore viewed in conjunction with the risks that the company faces. 1:12 1 minute, 12 seconds May I now request Mr. Madusan Vagera to take us through the company's business outlook and performance, subsequent to which we will open the floor for Q&A. 1:21 1 minute, 21 seconds Thank you and over to you, sir. Thank you, Janvi. 1:27 1 minute, 27 seconds Good evening and a warm welcome to all of you attending our earnings call for the quarter ended March 2026 and FI26. 1:39 1 minute, 39 seconds I trust you would have had the opportunity to go through the presentation which has been uploaded on our website as well as the stock exchanges. 1:52 1 minute, 52 seconds Before we get into the detailed numbers, I would like to briefly address how we are presenting performance this quarter. 2:00 2 minutes Typically, we review performance on a sequential basis, comparing Q4 with Q3. 2:08 2 minutes, 8 seconds However, the current quarter has been impacted by an unusually volatile external environment. 2:15 2 minutes, 15 seconds The sharp and rapid movement in crude oil prices during the quarter created significant uncertainty across the value 2:22 2 minutes, 22 seconds chain given the strong linkage of our business to crude and its derities. 2:30 2 minutes, 30 seconds The volatility disrupted the normal operation rhythm of the industry. 2:35 2 minutes, 35 seconds As a result, the Q4 versus Q3 comparison does not provide a like forlike reflection of underlying business performance. 2:44 2 minutes, 44 seconds It is influenced more by short-term external shocks rather than structural or operational factors. 2:52 2 minutes, 52 seconds Therefore, for a more meaningful assessment, we are presenting year-on-year comparison Q4 FI26 versus 2:58 2 minutes, 58 seconds Q4 FI25 and a fullear performance FI26 versus FI25. 3:06 3 minutes, 6 seconds I believe this approach is better to capture the true trajectory of the business excluding transient volatility. 3:14 3 minutes, 14 seconds We will of course address any specific question on sequential movements during the Q&A. 3:23 3 minutes, 23 seconds I'll quickly run through the key performance numbers on a year-on-year basis. Profitably showed an improvement. 3:31 3 minutes, 31 seconds The revenue in Q4 FI26 stood at 985.5 crores compared to 1080 crores in Q4 FI25. 3:41 3 minutes, 41 seconds Sales volume of Q4 FI26 were 89,841 3:49 3 minutes, 49 seconds metric t marginally lower than 96,561 metric t in the corresponding quarter last year. 3:58 3 minutes, 58 seconds Profitability matrix improved materially. 4:02 4 minutes, 2 seconds I beta increased by 13.86% to 86.26 crores from 75.73 crores in Q4 FI25. 4:12 4 minutes, 12 seconds PAT reduced by 2.75% to 40.25 crores compared to 41.39 crores last year. 4:22 4 minutes, 22 seconds For the full year FI26, the company reported a marginal decline in topline and volumes while 4:29 4 minutes, 29 seconds delivering strong growth in profitability. 4:33 4 minutes, 33 seconds Revenue in FI26 stood at 4,160 crores as compared to 4,252 4:39 4 minutes, 39 seconds crores in FI25 reflecting a slight decline. Production volume stood at 4:48 4 minutes, 48 seconds 3 lak 89,027 metric t just above about half a percent lower than 3 lak 91,300 metric t in FI25. 5:00 5 minutes Sales volume was reported recorded at 3 lak 88,800 metric t compared to 3 lak 90,200 metric t in the previous year. 5:12 5 minutes, 12 seconds Despite the modest decline in revenue and volumes, I beta increased significantly by 34.5%. 5:19 5 minutes, 19 seconds To 34650 crores, up from 257.70 crores in FI25, indicating 5:28 5 minutes, 28 seconds improved margins and operational efficiency. 5:33 5 minutes, 33 seconds PAT rose by 36.7% to 183.9 crores compared to 134.6 6 crores in the previous year. 5:44 5 minutes, 44 seconds The Indian textile industry entered FI26 on a strong growth trajectory. 5:50 5 minutes, 50 seconds The demand of polyester yarn was robust and we had a good performance till Q3. 5:57 5 minutes, 57 seconds I'd mentioned that the IETA in the first three quarter exceeded the IETA of the previous year. Our escalating 6:04 6 minutes, 4 seconds geopolitical conflict of Iran, Israel and US caused uncertainties and tensions in the Middle East 6:12 6 minutes, 12 seconds disrupting this momentum. In all these years, we have not witnessed such disruptions spread across the UAE, 6:21 6 minutes, 21 seconds Kuwait, Saudi Arabia, Oman etc. Straight of Homos, one of the busiest shipping traffic lanes was under seas. 6:30 6 minutes, 30 seconds A sharp surge of 40 to 45% in petrochemical input cost driven by crude linked volatility both 6:38 6 minutes, 38 seconds in terms of price as well as availability place significant pressure on the polyester value chain. 6:46 6 minutes, 46 seconds At the same time, weak demand and cautious market sentiment limited the ability of manufacturer to pass on these 6:53 6 minutes, 53 seconds cost increases resulting in margin compression across yarn and fabric segments. 7:01 7 minutes, 1 second Temporary policy interventions, including short-term custom duty relief, have had limited on ground impact due to 7:09 7 minutes, 9 seconds long import cycles, highlighting the need for more stable and predictable policy support. 7:17 7 minutes, 17 seconds In addition, supply chain disruptions, particularly uncertainties in availability of input materials and 7:24 7 minutes, 24 seconds shipping routes coupled with rising logistics cost and made forward planning increasingly difficult. 7:33 7 minutes, 33 seconds India's dependence on imports especially for MEG continues to remain a structural concern. 7:40 7 minutes, 40 seconds Workforce availability has also emerged as a challenge with migrant labor shortages. affecting operational continuity in several regions. 7:50 7 minutes, 50 seconds As a result, the industry is currently witnessing a phase of production rationalization with companies prioritizing operational stability and 8:00 8 minutes cost efficiency over aggressive volume growth. 8:05 8 minutes, 5 seconds Despite these unforeseen near-term pressures, the underlying fundamentals of the industry remain intact. The 8:12 8 minutes, 12 seconds current slowdown appears to be cyclical and sentimentdriven rather than structural 8:20 8 minutes, 20 seconds as textile continues to be a non-discretionary consumption category as geopolitical conditions stabilize and input cost normalize. 8:31 8 minutes, 31 seconds Therefore, demand is expected to deter positioning the industry for a gradual recovery. 8:41 8 minutes, 41 seconds In the European Union, the competitive picture is set to change quite sharply 8:48 8 minutes, 48 seconds once the India EU agreement comes into force. 8:52 8 minutes, 52 seconds The EU represent a large and attractive market over $370 billion offering substantial headroom for Indian exporters. 9:03 9 minutes, 3 seconds India will effectively move to zero custom duty from 10 to 12% presently on most textile and apperal exports. 9:12 9 minutes, 12 seconds In simple terms, EU is moving towards a structure where India and Vietnam are at zero duty while Bangladesh faces a 9:21 9 minutes, 21 seconds possible step up in tariffs after 2029 and China remains at a clear disadvantage. 9:31 9 minutes, 31 seconds In the United States, the situation is very different because there are no free trade agreements with India, Bangladesh or Vietnam for textile. 9:40 9 minutes, 40 seconds US market size is also large at around $300 billion. 9:45 9 minutes, 45 seconds All three countries India, Vietnam and Bangladesh export broadly under the same standard tariff structure typically 9:53 9 minutes, 53 seconds ranging from about 8 to 20% depending on the product. China is the clear outliner 10:00 10 minutes liar as it faces additional section 301 tariffs on top of the normal duties 10:08 10 minutes, 8 seconds taking its effective tariff burden to roughly 15 to 45%. 10:14 10 minutes, 14 seconds This creates a substantial pricing disadvantage for China and has been a key driver behind the shift of sourcing to other countries. 10:26 10 minutes, 26 seconds India's upcoming PTA capacity addition is now becoming a tangible led by Gale and Indian Oil Corporation. 10:36 10 minutes, 36 seconds Gail's Megalore plant is expected to commence commercial production around July 2026 10:45 10 minutes, 45 seconds making it more immediate and credible source of new supply. Indian oil's paradip pa project is making good 10:53 10 minutes, 53 seconds progress and commissioning is targeted around December 26. 11:00 11 minutes Together both projects could add about 2.4 million tons peranom of PTA capacity significantly reducing India's import dependence. 11:10 11 minutes, 10 seconds The Reliance is also setting up a large capacity of 3.2 2 million tons which is likely to go on stream by end of calendar year 2027. 11:21 11 minutes, 21 seconds So next 24 months would make [clears throat] a structural shift in PT availability in India. 11:27 11 minutes, 27 seconds In spite of all conflicts and upheavalss of Iran, Middle East, US causing 11:35 11 minutes, 35 seconds which are disrupting the well-established supply chain and logistics. 11:39 11 minutes, 39 seconds We remain resilient and we are bo about the medium-term prospects of polister industry 11:47 11 minutes, 47 seconds structural capacity additions in PTA easing of policy related cost risk improving global trade sentiments and 11:57 11 minutes, 57 seconds disciplined execution of our capex program together provide a strong foundation for sustainable growth and margin resilience. 12:08 12 minutes, 8 seconds Politex is under a comprehensive capex program of 690 crores aimed at driving the next phase of growth and 12:15 12 minutes, 15 seconds strengthening the its value added portfolio. This includes a PFY brownfield expansion, 12:23 12 minutes, 23 seconds enhancing FDY, DTY capacities and optimize the product mix towards higher 12:30 12 minutes, 30 seconds margin segments alongside a textiletoextile recycle green field project that establishes a circular 12:39 12 minutes, 39 seconds polyester platform converting end of life textiles into virgin grade polymer and yarn. 12:47 12 minutes, 47 seconds The company is also implementing automation at its the age plant to improve operational efficiency and 12:54 12 minutes, 54 seconds reduce labor dependency while advancing its renewable energy transition to significantly increase the share of green power in its energy mix. 13:06 13 minutes, 6 seconds In addition, a steam distribution initiative is being developed to monetize surplus steam from the captive power plant by supplying it to 13:16 13 minutes, 16 seconds nearby industries promoting energy efficiency. 13:21 13 minutes, 21 seconds Collectively, these initiatives are expected to deliver an annual impact in the range of 218 to 230 crores 13:30 13 minutes, 30 seconds while reinforcing Philatics competitiveness, sustainability, and long-term growth trajectory. 13:40 13 minutes, 40 seconds All our planned projects are now at an advanced stage of construction and installation and are progressing well in line with our execution road map. 13:51 13 minutes, 51 seconds The initiatives across recycling, capacity expansion, automation and energy transition collectively reflect 13:59 13 minutes, 59 seconds our continued focus on building a more efficient, sustainable and future ready business. 14:08 14 minutes, 8 seconds Barring any unforeseen circumstances, equipment deliveries are expected to remain on schedule, supporting timely 14:16 14 minutes, 16 seconds commissioning. Overall, this integrated capex program is ship shaping up as a well-coordinated effort towards 14:25 14 minutes, 25 seconds strengthening operations, improving cost efficiency and enhancing our sustainability objectives. 14:35 14 minutes, 35 seconds Thank you for your patient listening. 14:37 14 minutes, 37 seconds Now I'll be glad to answer your questions. Thank you. 14:43 14 minutes, 43 seconds Thank you very much. We will now begin the question and answer session. 14:47 14 minutes, 47 seconds Anyone who wishes to ask a question may press star N1 on their touchstone telephone. If you wish to remove 14:54 14 minutes, 54 seconds yourself from the question queue, you may press star and two. Participants are requested to use handsets while asking a 15:03 15 minutes, 3 seconds question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. 15:32 15 minutes, 32 seconds The first question is from the line of Surya Narayan Nayak from Suni Security. Please go ahead. 15:39 15 minutes, 39 seconds Yeah, thank you sir uh giving me opportunity. Am I audible properly sir? Yeah, you're audible. 15:48 15 minutes, 48 seconds Okay. Okay. Thanks. So sir uh as we progress in uh Q1 uh we understand that 15:56 15 minutes, 56 seconds now the volatility uh has reason uh still higher and uh presumably it will 16:03 16 minutes, 3 seconds be still remaining so in the Q2 also. So considering that what would be our uh 16:11 16 minutes, 11 seconds production planning for faster uh because uh uh because we you said that the uh the market is remaining costless. 16:20 16 minutes, 20 seconds So are we going to uh suboptimally use our capacities below maybe one lakh t perm quarter? 16:34 16 minutes, 34 seconds You see today it's very dynamic time. So we are very cautious and we are taking decisions based on the current market situation which are changing dayto-day. 16:46 16 minutes, 46 seconds So yes definitely we will be not producing full one lakh tons in this quarter. It could be lower by anything 16:55 16 minutes, 55 seconds from 20 to 25% minimum as of now but it's hardly one month which is over in this quarter. So it's difficult to say 17:04 17 minutes, 4 seconds how it will shape up in next couple of months because things are very very dynamic. You also know every day things are changing. 17:12 17 minutes, 12 seconds Yeah. Yeah. 17:16 17 minutes, 16 seconds So and secondly sir uh we saw that there is a foreign exchange fluctuations uh charge of around 13 cr. 17:29 17 minutes, 29 seconds So which has actually dented our bottom line though we have we were we did better in Aida gross margin everywhere 17:37 17 minutes, 37 seconds but just to understand from your structurally that after the PTA plants that will be coming up in the form of 17:45 17 minutes, 45 seconds the gale and others. So but still we will be depending upon the meg and uh 17:51 17 minutes, 51 seconds for a turn basis I would say 600 plus kg of PTA will be required plus around more 17:58 17 minutes, 58 seconds than 4 400 kg of mg will be required. So if that is the case that proposion then 18:05 18 minutes, 5 seconds how how the uh mitigation on the foreign exchange processions will be catered to because we are not exporting too much to 18:15 18 minutes, 15 seconds in our bucket. So how you are going to mitigate going forward because rupee is also sliding and that that scenario is 18:23 18 minutes, 23 seconds going to also not uh uh help us. Yeah, you're right. And so we have taken a cautious view and we would be hedging 18:32 18 minutes, 32 seconds more [clears throat] from now on. And see there's a misconception. It you 18:37 18 minutes, 37 seconds require 860 g of PTA and only 340 g of 18:43 18 minutes, 43 seconds MG to make 1 kg of polyester. Also the price of MG is much lower than PTA. So 18:50 18 minutes, 50 seconds if you go costwise the hardly the cost of MEG is less than 25% in the whole 18:57 18 minutes, 57 seconds scene. Still whatever it is we will try to take care that we don't lose so much. 19:02 19 minutes, 2 seconds It also even if we would have hedged totally then also the hedging cost is 19:09 19 minutes, 9 seconds around 3 and a half% to 4% per dollar and we at any given time have exposure of around 500 to 550 crores. So in any 19:18 19 minutes, 18 seconds case even if you hedge then also you lose around 17 and a half to 20 crores every year in the hedging cost. Of 19:26 19 minutes, 26 seconds course this quarter we have been caught on a wrong foot. So this war has continued longer than expected but 19:33 19 minutes, 33 seconds henceforth we are taking precaution that it does not repeat. 19:42 19 minutes, 42 seconds I'm sorry to interrupt Mr. Na your voice is mapped. We are not able. Can you please use your phone? 19:50 19 minutes, 50 seconds Yeah. Uh am I audible now? No, still saying. 19:57 19 minutes, 57 seconds I'll join you. Uh you can continue. Thank you. 20:02 20 minutes, 2 seconds Next question is from the line of Hitittara from Robo Capital. Please go ahead. 20:09 20 minutes, 9 seconds Uh thank you for the opportunity. Am I audible? 20:13 20 minutes, 13 seconds H yes you are. 20:14 20 minutes, 14 seconds Yes. Thank you. So sir the 690 crores of capri that we are doing how much of that would be equity and debt I mean I just 20:22 20 minutes, 22 seconds want to understand the split equity debt I can tell you debt is around 335 20:29 20 minutes, 29 seconds crores rest is equity right so do we have any outlook for that for fi 27 and 28 20:37 20 minutes, 37 seconds fi 27 and we would have a debt of around 350 to 360 crores on the 20:44 20 minutes, 44 seconds Right. And uh my second question is regarding ROE like what kind of ROE profile are you targeting? 20:52 20 minutes, 52 seconds I think by end of this year our ROE has come to 12.96%. 21:05 21 minutes, 5 seconds As compared to last 10.62 62 and hopefully we should be able to add 21:12 21 minutes, 12 seconds another 100 or 200 basis point in this year if things become all right in this quarter. If they continue for long then it's difficult to say. 21:23 21 minutes, 23 seconds All right. Understood. Thank you. Thank you. 21:32 21 minutes, 32 seconds Next question is from the line of Nirj Manga from Pipine Investment. Please go ahead. 21:39 21 minutes, 39 seconds No, thank you. I just uh wanted to understand on the uh uh you said uh you mentioned about a difficult scenario. 21:47 21 minutes, 47 seconds Can you uh elaborate on that? Uh is there a volume issue or is there availability of raw materials or raw material is not an issue. The 21:55 21 minutes, 55 seconds problem is the prices have gone up very high and we are not able to pass on the full price and demand is also low because the downstream doesn't want to 22:02 22 minutes, 2 seconds buy at higher prices because they not able to sell goods at higher prices and everybody is afraid if the war stops there will be a sudden drop in the raw 22:10 22 minutes, 10 seconds material prices. So everybody is cautious and fabric is such a thing that people can postpone their buying for 22:18 22 minutes, 18 seconds some short time. So that is what is happening right now. Although now some recovery in demand we can see from uh 22:27 22 minutes, 27 seconds starting of this month. So let us say how things go forward. Basically people are not able to digest such high prices as of now. So they are little cautious 22:36 22 minutes, 36 seconds at this moment. And traditionally also see April and May are not very good months. There's lot of migration of the labor and this time labor migration has 22:44 22 minutes, 44 seconds increased drastically due to the shortage of LPG with cylinders and all. 22:49 22 minutes, 49 seconds So these all these migrated labor use these cylinders and the cost of the cylinders have gone very high and there 22:56 22 minutes, 56 seconds was some fear among them I don't know what but yes there is a fear so labor has been going back to their native 23:04 23 minutes, 4 seconds places in a huge volumes and this west Bengal elections also and elections other places also supported this so all 23:12 23 minutes, 12 seconds in all this has happened but now I think labor has started coming back so maybe by end of this month or middle of this month things should normalize. 23:23 23 minutes, 23 seconds Got it. Uh but in terms of then you not able to increase the prices. Can you uh tell how the spread was in Q3 and uh 23:31 23 minutes, 31 seconds what was the average for Q4 and what is it currently the any typical spread that 23:37 23 minutes, 37 seconds you track? You see we were doing around 9 rupees a kg profitability which 23:44 23 minutes, 44 seconds dropped this quarter in the month of March significantly because of March thing. March the 23:53 23 minutes, 53 seconds results are slightly better because also we got because the prices increase there is some stock profit also involved in this 24:01 24 minutes, 1 second otherwise we would have had low lower profits. But how much did it fall to in the month of March as much as March? If 24:10 24 minutes, 10 seconds I take March independently, I think we would be wa neutral. There would be hardly any bit in March. If we take prices of the raw material on the 24:17 24 minutes, 17 seconds current day and the sales on the current day. Got it. Got it. And what about today? Like how is it right now? 24:23 24 minutes, 23 seconds Today also it is almost beta neutral at the moment. 24:29 24 minutes, 29 seconds Got it. But with the with the crude price correcting u do you see this uh your margins coming back uh after 24:37 24 minutes, 37 seconds the problem is not the crude price being high or low the problem is the fear that it will fall once the war stops. We have 24:45 24 minutes, 45 seconds witnessed such high crude prices previously also in the long time back and also higher than this. But if you feel the prices are going to go up, the 24:53 24 minutes, 53 seconds mark demand is there. But if you have a fear that it can fall any day, which it did once there was a truce. No, it fell to almost $85. 25:03 25 minutes, 3 seconds So that fear is there among the people. 25:05 25 minutes, 5 seconds No, if that fear goes away, it doesn't affect too much to them buying 10 rupees costly or cheaper in the final product. 25:14 25 minutes, 14 seconds Got it. But what is the comment? Can can you comment on the the inventory in the system of the uh your of your customers 25:21 25 minutes, 21 seconds like how is it right now? Any thoughts on that? 25:23 25 minutes, 23 seconds Right now everybody has zero inventory on their raw materials. Finished inventories are little high because everybody has sales problem but the raw 25:32 25 minutes, 32 seconds materials everybody is keeping on a very very low inventory. 25:36 25 minutes, 36 seconds Your customers they are hardly having uh much of yan. 25:39 25 minutes, 39 seconds Yeah. they don't have yan and similarly we don't have too much of ptmg but we have some finished products extra 25:46 25 minutes, 46 seconds production uh stocks although we have curtailed production so that we don't go beyond a certain days 25:55 25 minutes, 55 seconds okay we don't want to keep too much of stock but yes it is on a higher side so how does it work out in the sense that when there's a demand pull uh uh is 26:03 26 minutes, 3 seconds there availability of uh imported products right now in the market or imported was also coming in a big way 26:11 26 minutes, 11 seconds but I think uh going forward it will not come because Chinese prices are very high. Also government had for a time 26:20 26 minutes, 20 seconds being uh removed the duty on PTMG till June. 26:25 26 minutes, 25 seconds So that also helped a little bit but otherwise also Chinese prices are quite high even if we take it into 26:32 26 minutes, 32 seconds account like our prices are lower by 10 to 15 rupees than Chinese landed prices as of today. Are you talking of PTMG both? 26:40 26 minutes, 40 seconds No I'm talking about yan PTM of course we get at the landed price only there because it's almost like a semi monopoly 26:48 26 minutes, 48 seconds kind of a situation. No okay sorry I I'll just slot I just repeat what you said. You said the Indian yan prices today are lower than the Chinese imported ones. 26:57 26 minutes, 57 seconds Right. 26:58 26 minutes, 58 seconds And uh and uh the Chinese we get an import par only there we don't get any discounts I mean major discounts 27:06 27 minutes, 6 seconds from the suppliers they are pegged at import [clears throat] parity more or less. 27:12 27 minutes, 12 seconds So your raw material is same as what the Chinese guys are facing but your selling prices are 10% lower and that's the reason for the compression in margins today. 27:19 27 minutes, 19 seconds Right. Our prices are higher than Chinese because Chinese get PTA much lower. We import from China only. PTA MG 27:26 27 minutes, 26 seconds yes we are both equal but in PTA definitely our prices are much higher to the tune of the freight and uh cost of 27:34 27 minutes, 34 seconds handling which we have to incur extra for getting it to India which is at the moment around 8 to 10 27:41 27 minutes, 41 seconds rupees because the freights are also very high today. 27:47 27 minutes, 47 seconds Okay. that is inbuilt in the Indian price. Got it. I'll come back to the queue. 27:54 27 minutes, 54 seconds Thank you. 27:57 27 minutes, 57 seconds Thank you. Next question is from the line of Salony Munchi from Chrystal. Please go ahead. 28:04 28 minutes, 4 seconds Hi, am I audible? Yes, you are. 28:07 28 minutes, 7 seconds Yeah. I just wanted to know the since the revocation of QCO in November, have we seen any impact on our business for the Q4? 28:17 28 minutes, 17 seconds Yeah, after the QCO info question there was a flu I mean there was a lot of imports from China. So that's why we 28:24 28 minutes, 24 seconds also had some margin pressure in this January and February. 28:29 28 minutes, 29 seconds We corrected the price to avoid imports but still uh there was lot of imports happening and which is coming till now 28:38 28 minutes, 38 seconds but now the Chinese prices have moved very high. So new imports will not come in future but whatever had been booked earlier is still coming. 28:48 28 minutes, 48 seconds Oh okay thanks. And secondly, we have heard a lot about like substitution, people will be moving towards cotton 28:55 28 minutes, 55 seconds from synthetic and all. Is that possible like since polyester has different properties? 29:02 29 minutes, 2 seconds Nobody can move from polyester anywhere because anything other than polyester is either 50 to 100% costlier than minimum 29:09 29 minutes, 9 seconds 100% costlier than polyester. So who would like to move to a costlier product? Okay. Okay. That's it from my side. 29:17 29 minutes, 17 seconds Thank you so much. 29:22 29 minutes, 22 seconds Thank you. Next question is from the line of UJ Sagal from Pinpoint X Capital. Please go ahead. 29:32 29 minutes, 32 seconds Yeah, good afternoon sir. Am I audible? Yes, you are. Please go ahead. 29:37 29 minutes, 37 seconds Uh so I wanted to uh know regarding the steam project uh what is the progress on that? When should that be online? 29:45 29 minutes, 45 seconds because that had a good saving uh you know on a small capeex. 29:49 29 minutes, 49 seconds Yeah. So that should be online. It was supposed to be online in June but we are facing some delivery issue in the turbine. So maybe 1 month more maybe in mid July max. 30:03 30 minutes, 3 seconds And regarding the recycling project sir uh what are the timelines? Are we on track? And uh we've been hearing news about that 30:10 30 minutes, 10 seconds that is that is to start by end of September and right now everything looks to be on time. I don't see any delay in that. 30:20 30 minutes, 20 seconds Okay. Okay. And we've been doing like tieups with Decathlon and like other uh Yeah. Yeah. We are in talks with lot of 30:27 30 minutes, 27 seconds companies and hopefully we should be having a good start once we start and we are also doing seed marketing with them. 30:33 30 minutes, 33 seconds We are from our pilot plant. We are giving them samples and getting approval so that they can place some bigger orders once our plant is operational. 30:44 30 minutes, 44 seconds So you don't see any challenge in booking the whole production once you there there are a lot of challenges. I don't say I don't see but we are trying 30:51 30 minutes, 51 seconds to work on it. It's a new product new everything. So there would be challenges but yes we are trying our best so that 31:00 31 minutes we can overcome them before our plant starts in terms of sales. 31:05 31 minutes, 5 seconds because it's a you know with all the brand it's a little longer timeline till they approve the things 31:14 31 minutes, 14 seconds and I I believe sir our main market for this was uh the EU uh European Union so with the FT coming in would that uh further give a Phillip to us? 31:25 31 minutes, 25 seconds Yes, it could it can give a further advantage to us once it is uh operational. [snorts] I think I believe it will be operational 31:32 31 minutes, 32 seconds by end of this calendar year the way things are. Thank you sir and best of luck. 31:40 31 minutes, 40 seconds Thank you. 31:44 31 minutes, 44 seconds Thank you. Next question is from the line of Saga from Astral Investments. Please go ahead. 31:52 31 minutes, 52 seconds Hello. Am I audible? Yes, you are. 31:57 31 minutes, 57 seconds Yeah. Uh sir, what is your gross assception on this green field project and brownfield project? 32:06 32 minutes, 6 seconds Say again please. 32:09 32 minutes, 9 seconds Uh gross assessment. So basically what kind of revenue are you expecting from this 300 capex from Greenfield? 32:18 32 minutes, 18 seconds See the brownfield we would be doing 55 32:29 32 minutes, 29 seconds around 500 crores top line from the brown field and around 350 to 400 in the green field of recycling. 32:41 32 minutes, 41 seconds Okay, fair enough. And sir uh you you told us about uh this uh Indian oil and Gale and Reliance is putting up their 32:49 32 minutes, 49 seconds PTA capacity uh around 2.4 million this year and next year 3.4 million. So what 32:56 32 minutes, 56 seconds is their current capacity for PTA and also uh then we would be uh taking from 33:03 33 minutes, 3 seconds them and would be any cost advantage to us? Uh are they cost advantage? 33:09 33 minutes, 9 seconds See once a commodity becomes surplus in a country automatically everybody would compete and give you at a better price. 33:16 33 minutes, 16 seconds Right now Reliance produces around 4.2 to 4.4 million tons. Indian oil produces 33:23 33 minutes, 23 seconds around.7 million tons and gale this is the first one. 33:29 33 minutes, 29 seconds Fair enough. So you are saying that also you said that uh currently uh you know de demand is an issue, selling is an 33:36 33 minutes, 36 seconds issue basically and everyone is running low on raw material. So availability is not an issue but see 33:44 33 minutes, 44 seconds demand for the yarn is an issue that is why everybody is running on a low capacity. Overall the industry is running at around 60% capacity 33:52 33 minutes, 52 seconds utilization. We are running at around 75%. 33:57 33 minutes, 57 seconds Uh fair enough. So in terms of uh global polyester uh yarn demand so uh I was reading an article where China is also 34:06 34 minutes, 6 seconds saying that they want to have better RO on their capacities and all. 34:09 34 minutes, 9 seconds So they are also rationalizing their capacities. They are closing down plants which are inefficient and not profitable. So that is why you can see 34:18 34 minutes, 18 seconds their price has gone quite high. So because they also want to make profits now. 34:24 34 minutes, 24 seconds Yeah. What do you think things normalize we will be able to capture that also? 34:30 34 minutes, 30 seconds Yeah. So how do you think industry next two three years? 34:35 34 minutes, 35 seconds I think once this washed off things normalize industry to show very well. 34:39 34 minutes, 39 seconds This is these are going to be very golden years for polyester once it stops. 34:45 34 minutes, 45 seconds Fair enough. And also uh I mean this textile to textile thing. So is any global company or pair that we can study 34:54 34 minutes, 54 seconds because this is a complete new thing right and uh there there are lot of companies who are planning to bring it but there is no 35:03 35 minutes, 3 seconds company which is operational as of now there's only one company in China which is operational for that data I don't think is easily available cyclone is the 35:12 35 minutes, 12 seconds name of the company but right right there are two three companies is fusing carios. 35:21 35 minutes, 21 seconds Carbios is trying now loop has tied up with Esther. So even if you just study the loop project with Esther they are 35:30 35 minutes, 30 seconds putting almost two and a half time capex per turn than what we have put and if you see their pricing and I beta 35:38 35 minutes, 38 seconds commitments they are much higher than what we are saying. 35:43 35 minutes, 43 seconds There is there is there are lot of companies you can Google it you'll get lot of companies who are doing chemical recycling and they have spent millions 35:52 35 minutes, 52 seconds and millions of dollars in research but still they have not come up with any big plant. 36:00 36 minutes So what what you're doing is quite special basically right? Yeah it is. Let's hope it works well. 36:09 36 minutes, 9 seconds Yeah that's our money on it. 36:12 36 minutes, 12 seconds Yeah. So then how do you when you approach a client let's say how do you uh uh I know that you have a pilot plant 36:19 36 minutes, 19 seconds and you had this the kelon and all that the pilot plant we show in the product they test the product they check every quality they make fabrics out of it 36:28 36 minutes, 28 seconds garments out of it and if they are satisfied then they would go ahead with bigger orders in future 36:35 36 minutes, 35 seconds and in the first year uh so what uh expectation in terms of capacity utilization you have for this plant uh in 36:43 36 minutes, 43 seconds for 6 month I don't feel that we would be able to utilize fully maybe around 70% or 65%. 36:50 36 minutes, 50 seconds But then next 6 month we should be almost full capacity. First 60 70% is also very good. 36:59 36 minutes, 59 seconds Huh? 60 70% is also very good. 37:03 37 minutes, 3 seconds Yeah. Yeah. Because uh I feel that much because the kind of tie-ups we are having and the talks we are going on. 37:10 37 minutes, 10 seconds I'm sure because it's not a big capacity. 75 tons per day is not a big capacity. There are people who can buy the whole 75 tons in one go. 37:20 37 minutes, 20 seconds And sir, in terms of prices, so what would be the difference of a normal polyester yarn uh per kg price versus 37:27 37 minutes, 27 seconds you know textile to textile realization difference? 37:30 37 minutes, 30 seconds Oh, it could be it could be ranging from like today the price of uh virgin yarn 37:36 37 minutes, 36 seconds is around 120 rupees. This could be 180 to 225. 37:44 37 minutes, 44 seconds Fair enough. Okay. Thank you, sir. I will be joining the chat. Thank you. 37:54 37 minutes, 54 seconds Next question is from the line of Dasha from Sappire. Captain, please go ahead. Hello. 38:02 38 minutes, 2 seconds You're audible ma'am please proceed. Yes. 38:05 38 minutes, 5 seconds Yeah. Okay. So, thank you for this opportunity. So if I look at your past 12 to 15 your quarterly London it has sort of been in the range of,000 to 1100 38:14 38 minutes, 14 seconds sort of clip but given this expansion that is going to come online how do you see growth in FR27 and going ahead any 38:22 38 minutes, 22 seconds color on that right now with this war situation I can't give you any good guideline if the 38:30 38 minutes, 30 seconds normal year we would do at least 500 crores more than what we do in an year which is 42 4300 so We should be close 38:38 38 minutes, 38 seconds to 4,800 with the new capex which we are doing in filletex with the subsidiary capex that will add another 350 to 400 crores more. 38:53 38 minutes, 53 seconds So you you so you're hoping for around 4,800 for a clip. 38:59 38 minutes, 59 seconds Yeah. in a full year or full operation year we should no but this FI27 only 6 months we will get for the right new 39:08 39 minutes, 8 seconds production so it will may be around 4500 in this year and FI28 it could be around 4,800 in 39:15 39 minutes, 15 seconds filletex and another 400 from Ecos okay fair enough and how should one look 39:23 39 minutes, 23 seconds at the margin going ahead what's the steady state that you're targeting I think steady state we should do 39:31 39 minutes, 31 seconds something above double digit in filler tax of course in tax field the the beta 39:37 39 minutes, 37 seconds margins would be around 30% minimum how much 30%. 39:47 39 minutes, 47 seconds Oh, that the subsidiary business. 39:49 39 minutes, 49 seconds Yeah, that's a speciality business that will definitely have more margins than this. 39:57 39 minutes, 57 seconds Okay. Okay. And how do we see this subsidiary sort of revenue shaping up? 40:02 40 minutes, 2 seconds What percentage of the overall revenues are we targeting? 40:05 40 minutes, 5 seconds I gave you the numbers, you can calculate the percentage. No, I said 350. 40:10 40 minutes, 10 seconds No, no, go ahead. Yes. So that's the full capacity wise it can do around 400 crores. So it's not going to increase 40:18 40 minutes, 18 seconds the full capacity utilization also it gives you 400 cr. 40:22 40 minutes, 22 seconds Oh okay. All that. Okay. That's it from our side. Thank you. 40:29 40 minutes, 29 seconds Thank you. Next question is from the line of Hitandra Pradhan from Maximal Capital. Please go ahead. 40:37 40 minutes, 37 seconds Yes sir. Good afternoon and thank you for giving the opportunity. Am I audible? 40:43 40 minutes, 43 seconds Yes, you are. Please go ahead. So, sir, first question is this 690 crx that you are doing. You said 335 cr will be the 40:51 40 minutes, 51 seconds additional debt that you will take. So, remaining everything will come from the internal approvals or you would no no all internal approvals. 41:04 41 minutes, 4 seconds Okay, understood. Uh secondly u you know uh when I look at uh this uh your base 41:12 41 minutes, 12 seconds polyester business so that has been doing like 8% sort of a margin if I exclude the other income. So uh going 41:20 41 minutes, 20 seconds forward also should we consider this 8% as a base for a PFI business? 41:28 41 minutes, 28 seconds No no the base has to go to like at least 11 12% otherwise nobody would reinvest in this business. So today 41:36 41 minutes, 36 seconds typically two lakh t cost around 17,800 crores. So if you don't gen which is two lakh t means around 41:45 41 minutes, 45 seconds 2250 to 2400 crores of top line. So you have to generate around 12% to justify your investment. 41:54 41 minutes, 54 seconds Agreed. But in a lot of commodities at the end of the day you are making these sort of lower margins and lower ROC only 42:02 42 minutes, 2 seconds when you compare it to green field it doesn't make sense then you will not see a growth in that commodity you know nobody will put up a 42:09 42 minutes, 9 seconds new plant for that so every year in world you need three three and a half million tons of polyester 42:18 42 minutes, 18 seconds and right now the polyester capacity worldwide I mean the production worldwide would be close to 53 to 54 million tons. India is doing around 5 42:27 42 minutes, 27 seconds and a half million tons. China is doing around 42 43 million tons. China will also not grow if they don't get around 10% margin. 42:38 42 minutes, 38 seconds Okay. Okay. So let's say it reaches to 10% odd and then you are also doing you know this renewable and steam project 42:47 42 minutes, 47 seconds which is and the packaging. This year this year our margins was around 8.9%. 42:58 42 minutes, 58 seconds Huh? 42:58 42 minutes, 58 seconds 8.33 full year. 43:00 43 minutes Full year 8.33. 43:02 43 minutes, 2 seconds Now PTA coming to India with all these company that will add at least 1 one and a half% more margin. 43:10 43 minutes, 10 seconds So 10 above 10 is a very very easily achievable at least in uh once the things are normalized. 43:19 43 minutes, 19 seconds Understood. Understood. Now you also mentioned that you can get a PAT of 218 to 230 cr from all these initiatives 43:29 43 minutes, 29 seconds that is the annual PAT which will be added. bad. I said I said I not bad 218 to 230 cr of additional ITA from all these investments. Yes. 43:41 43 minutes, 41 seconds And and by when can we hope to reach to this level? 43:47 43 minutes, 47 seconds No. All these things will be more or less commissioned by September. So in the second half barring the recycle we 43:55 43 minutes, 55 seconds should be utilizing the capacities fully more or less. 44:00 44 minutes So which is going to generate around 80 90 crores of I beta. So if you leave that 44:07 44 minutes, 7 seconds so we should be able to get at least 140 crores means 70 critional in this year from the other operations. 44:16 44 minutes, 16 seconds Okay. So everything else will get immediately utilized including the PFI expansion month or so. I mean not immediately but 44:24 44 minutes, 24 seconds not more than a month is the lag time for everything. Okay. team could take 2 3 months. 44:30 44 minutes, 30 seconds Initially maybe we do 70 80% and within 2 3 months we'll be able to add more clients. 44:37 44 minutes, 37 seconds Understood. Now coming to the ecos so you know right now you mentioned that there's some pilot going on with couple 44:45 44 minutes, 45 seconds of clients. So you know what is the technology? So now you are giving them the final product and then they will be 44:53 44 minutes, 53 seconds manufacturing. So have you received any positive or negative feedback till now from these clients? 45:00 45 minutes No, there's no negative feedback. It's a process which is a longer process. You have to submit sample. It goes to their 45:06 45 minutes, 6 seconds different places. Then it gets converted into garments and then they do it's it's a long process. It takes four to six 45:14 45 minutes, 14 seconds months for any big company to approve things minimum. 45:20 45 minutes, 20 seconds Okay. So when are we expecting to you know in your own mind like when you will get confidence that okay now the 45:27 45 minutes, 27 seconds validation of this for the clientele that I'm targeting is over when is that uh milestone sir 45:35 45 minutes, 35 seconds it's difficult to say there are so many clients like two we have already achieved now with others we are working 45:43 45 minutes, 43 seconds and I hope that we should be able to complete the desired quantity by this year and at least the number of customers we need to sell our full volume. 45:54 45 minutes, 54 seconds Okay. No sir, but I was thinking that you know given the requirements of these customers which are very large even if 46:02 46 minutes, 2 seconds you satisfy the requirement on the technical parameters for one client your entire capacity should get booked by 46:10 46 minutes, 10 seconds this one client itself. Right? So then we would not like to do that. No, we'll be dependent on that. Supposing he stops buying, what do we do? 46:20 46 minutes, 20 seconds So nobody wants to be dependent on one client. We would like to have a basket of clients. Okay. Okay. 46:29 46 minutes, 29 seconds And and I'm sorry to interrupt. Mr. Pradhan, please rejoin the queue for follow-up questions. Yes sir. 46:38 46 minutes, 38 seconds Thank you. Next question is from the line of Anjharia from Interglobe Services. Please go ahead. 46:46 46 minutes, 46 seconds Uh hi my question is more around the PTA facilities that are coming up. So now with the new brownfield capacity coming 46:53 46 minutes, 53 seconds up in September our total capacity be somewhere nearly 4 lakh 70,000 metric tons. So in absolute terms can you 47:01 47 minutes, 1 second quantify and how much um how many crores of rupees we'll be saving when the new PTA plant comes live in July and December. 47:10 47 minutes, 10 seconds savings in terms of what you have to buy PTA right now we are importing then our imports will reduce once this plant comes in operation 47:17 47 minutes, 17 seconds correct correct so basically correct current currently the freight charges extra that we're paying how much how much no but see even the Indian they are not 47:27 47 minutes, 27 seconds leaving anything whatever is the landed cost of the imported they are charging at the same price so there will be no savings the savings will happen once ETA 47:36 47 minutes, 36 seconds becomes excess in India then they will compete and sell cheaper more than the landed price. 47:42 47 minutes, 42 seconds Okay. Okay. Got it. So initially initially to begin with there would not be any any savings or margin improvement 47:48 47 minutes, 48 seconds on this front there but very negligible once both the plants are operational IOC and Gale then maybe some savings will 47:57 47 minutes, 57 seconds creep in because then there'll be enough PT available and they would like to fight among themselves to get hold of 48:04 48 minutes, 4 seconds the customers. So they could offer some extra discounts. 48:09 48 minutes, 9 seconds Okay. Got it. Got it. That'll be also madness. Thank you. 48:16 48 minutes, 16 seconds Thank you. Next question is from the line from Suni Securities. Please go ahead. 48:25 48 minutes, 25 seconds Yeah sir. Am I audible sir? Properly. 48:29 48 minutes, 29 seconds Hope I'm audible. So yeah. So uh just to understand one point that in the uh in 48:38 48 minutes, 38 seconds the textile to textile recycling when the uh the P chips will be recovered. So 48:45 48 minutes, 45 seconds that has to be again further uh processed. So if that is the case then are we going to utilize the new facility 48:53 48 minutes, 53 seconds that is upcoming new facilities to process the uh the same uh and second question is that in the uh in the 49:02 49 minutes, 2 seconds glycolysis process that we are currently implementing uh if my understanding is right. So uh that is actually giving the 49:11 49 minutes, 11 seconds pet uh which is which is nearly uh in terms of quality parameters virgin pet 49:19 49 minutes, 19 seconds then my point is that uh because of this uh crude volatility and the PTA me 49:26 49 minutes, 26 seconds issues. So are we are we thinking of uh you know having more of the recycling 49:33 49 minutes, 33 seconds facilities to extract the uh PET rather than uh that is the the recycle recycling route rather than the margin 49:42 49 minutes, 42 seconds route because the mandate from the EU side is increasing. So what is the what is the call in on your side for the long-term view? 49:53 49 minutes, 53 seconds The long-term definitely we would like to go more for recycling only. We will not invest too much money in the virgin. 50:00 50 minutes This also virgin we have invested is a brownfield project. So we had certain extra chips available or certain places 50:06 50 minutes, 6 seconds where we could add value. There we had invested with 235 crores. Going forward I don't think too much opportunity would 50:15 50 minutes, 15 seconds be left and major expansions would come only in the recycle business where we would be converting textile waste into virgin chips. 50:26 50 minutes, 26 seconds Yes, this yarn facility we can use for virgin as well as recycle [clears throat] which new or existing 50:32 50 minutes, 32 seconds which we have right now. So we can use any facility for converting from virgin 50:39 50 minutes, 39 seconds or recycle. Once you have a chip then every facility is similar. 50:46 50 minutes, 46 seconds So this uh two this 300 of facility uh the end product will be cheap or we will 50:54 50 minutes, 54 seconds be processing or the end product will be the yarn. 50:58 50 minutes, 58 seconds It will be only chip yarn if need to be processed it will be processed in the existing facility or the new machines which we are putting. 51:08 51 minutes, 8 seconds But the mandate from the uh global brands that is coming that is for the yans not the cheap I mean I mean if my 51:18 51 minutes, 18 seconds we will make chip from the existing facility and give it to them if they want yan. 51:24 51 minutes, 24 seconds Okay but their mandate is only from the recycled one I mean from especially from the chemical process. 51:30 51 minutes, 30 seconds So so the chip is basically made from textile waste. No, that is what the mandate is that your raw material should be textile waste not pet bottle. 51:39 51 minutes, 39 seconds Correct. So we are making the chip from textile waste and after that if we make yarn from that it still qualifies for their whatever they have the mandate for. 51:50 51 minutes, 50 seconds Correct. So my point is that no is it not prudent in in the cost wise is it not prudent to go for that kind of 51:58 51 minutes, 58 seconds facilities more going forward rather than I mean I mean scale of put more chip plant see my technology is to 52:07 52 minutes, 7 seconds convert waste to chip my technology is not there to convert chip to yan I can send chip to people who are making yan no 52:14 52 minutes, 14 seconds I need not invest on something which is already there is no technological advantage so I will make chips and there are lot 52:21 52 minutes, 21 seconds of people who can make yarn and give it to the customers. 52:26 52 minutes, 26 seconds So we already have we can use that also. 52:30 52 minutes, 30 seconds But if you require more yarn and if we have more chips then there are lot of people who would be willing to buy chip and make yarn and give it to people all these brands. 52:40 52 minutes, 40 seconds So beyond beyond this brown facilities you know we will not focus on the yarn more on the cheap side right am I right? 52:48 52 minutes, 48 seconds Yes, you're right because that is what the technological advantage we have and what is what we have developed. 52:56 52 minutes, 56 seconds Okay. And so uh regarding please rejoin for followup question. Thank you. 53:05 53 minutes, 5 seconds Next question is from the line of Nirj from White Pine Investment Management. Please go ahead. 53:11 53 minutes, 11 seconds I I just had a clarification. Uh you said about the the prices in India is lower for the polyester yarn. uh what 53:18 53 minutes, 18 seconds I'm what I understand is for you uh your cost is similar to what a Chinese guys are bearing with adjust adjusted for the 53:27 53 minutes, 27 seconds freight cost but the realization that you are getting in India are 10% lower than what China competitors are getting 53:35 53 minutes, 35 seconds is it the right understanding yes yes so because in India demand is very low and we are competing amongst 53:42 53 minutes, 42 seconds each other and we have all of us have cut production also that is why the margins are lower at the moment. Once 53:50 53 minutes, 50 seconds the demand picks up, everything gets normalized. 53:53 53 minutes, 53 seconds So on a like to like basis because the prices are 12%. Uh there there's a possibility of uh maybe 10 to 12 8 to 12 54:02 54 minutes, 2 seconds rupees jump in the prices once the demand comes back. Is it the right understanding? Yes. Right. You're right. 54:09 54 minutes, 9 seconds Okay. Got it. Thank you. 54:13 54 minutes, 13 seconds Thank you. Next. Next question is from the line of saga from astrology investments. Please go ahead. 54:22 54 minutes, 22 seconds Hello. Yeah, thank you for the question. Uh, so just one thing wanted to clarify. 54:28 54 minutes, 28 seconds So you said that 30% margin on textile to textile plant on other hand your presentation says around 65 80 crores of epida. So margin should be 20%, right? 54:40 54 minutes, 40 seconds You said 30% on the call. 54:44 54 minutes, 44 seconds The margin is 30% maybe is very difficult to predict right now but I'm saying minimum 30% IATA we 54:52 54 minutes, 52 seconds should get okay but that you made in the presentation like 55 80 crit and your revenue would be 55:00 55 minutes 25 crores for recycle not 60 80 to 85 crores I have always maintained for recycle which is on a lower side it can 55:09 55 minutes, 9 seconds always be improved one Krishna I tried to be not too optimistic be very conservative. 55:20 55 minutes, 20 seconds Okay. Fair. And second in fact we are getting we are feeling we should be able to do better in the percentage that understood. And so just one more thing. 55:31 55 minutes, 31 seconds So the past participant has asked uh we have the technology of polyester chips and we will be uh you know converting 55:38 55 minutes, 38 seconds that to the yan and or maybe polisher chip selling to the other player to convert it to the y so it's a backward 55:45 55 minutes, 45 seconds integration right I think so uh so how would you know your revenue would grow in FI28 so this uh let's suppose that 55:53 55 minutes, 53 seconds this three 400 k of topline that you're targeting if you use that internally right to make the yarn then your your 56:02 56 minutes, 2 seconds margins will increase but your sales will not be right. 56:06 56 minutes, 6 seconds Yeah, if I you're right. If I use that volume to convert in-house then my top line will not grow too much. It will 56:14 56 minutes, 14 seconds grow with the only incremental value addition which I'm doing right and yeah but my idea is to sell chip more 56:24 56 minutes, 24 seconds than convert it. Conversion I'm doing to satisfy them initially. Yes, this can be converted to yarn and it will give you a better result. But eventually see that 56:32 56 minutes, 32 seconds is not a technology from any chip you make a yarn is same thing. So the value addition is not going to be very extraordinary in converting from textile recycle chips to yarn or virgin to yarn. 56:45 56 minutes, 45 seconds So going forward we like to invest more in the technology which we have developed. No. 56:51 56 minutes, 51 seconds Understood. Fair enough. Okay. That's it. Thank you sir. 56:58 56 minutes, 58 seconds Thank you ladies and gentlemen. We will take that as a last question. I would like to hand the conference over to the management for closing comments. 57:12 57 minutes, 12 seconds I'd like to thank all the participants. 57:19 57 minutes, 19 seconds So next time we see you after another 3 months. Thank you very much for sparing your time and joining us in our call. 57:28 57 minutes, 28 seconds Thank you very much. 57:31 57 minutes, 31 seconds Thank you very much. On behalf of Filex India Limited, that concludes this conference. Thank you all for joining us 57:37 57 minutes, 37 seconds today and you may now disconnect your