Fineotex Chemical Limited — Q2 FY26

Fineotex Chemical Ltd Q2 FY2025-26 Earnings Conference Call https://www.youtube.com/watch?v=IU2jRJoPnLY Published: 5 months ago

0:00 Ladies and gentlemen, good evening and welcome to the Q2 and H1 FY26 earnings conference call of Photex Chemical Limited. 0:09 9 seconds As a reminder, all participant lines will be in the listenon mode and there will be an opportunity for you to ask questions after the presentation concludes. 0:18 18 seconds Should you need assistance during the conference call, please signal an operator by pressing star and then zero on your Touchstone phone. 0:26 26 seconds Please note that this conference is being recorded. 0:30 30 seconds I would now like to hand the conference over to Mr. Amit Kumar Sharma from ad factors. Thank you and over to you sir. 0:38 38 seconds Thank you Saga. Good evening everybody and a very warm welcome to you all. 0:44 44 seconds Thank you for participating in the earnings conference call of Photex Chemical Limited for the quarter ended September 30th 2025. 0:55 55 seconds Before we begin, please note that this conference call may contain forward-looking statements about the company which are based on beliefs, 1:03 1 minute, 3 seconds opinions, and expectations of the company as on the date of this call. The statements are not a guarantee of future 1:10 1 minute, 10 seconds performance and involve risk and uncertainties that are difficult to predict. On the call today, we have with 1:17 1 minute, 17 seconds us Mr. Mr. Sanjay Chraal, executive director, Miss Arti Yunjunwala, executive director and Mr. 1:25 1 minute, 25 seconds Arind Chri, chief executive officer, textiles. 1:30 1 minute, 30 seconds The management will take us through the operational and financial performance for the quarter gone by following which we will open the forum for the Q&A. I 1:39 1 minute, 39 seconds now request Miss Arti Junjunwala to take us through the company's performance. Thank you and over to you ma'am. 1:47 1 minute, 47 seconds Thank you Amit G and a very good afternoon everyone. It is always a pleasure to connect with our investors, analysts and stakeholders. 1:56 1 minute, 56 seconds We deeply appreciate your time and your trust in Photex Chemical Limited. 2:02 2 minutes, 2 seconds Pyoteex is not just a specialtity chemicals company. We are a solutionsdriven organization built on innovation, customer centricity and sustainable value creation. 2:14 2 minutes, 14 seconds Our integrated product range, strong global presence, and deep industry relationships position us to well cater 2:22 2 minutes, 22 seconds to the evolving needs of a wide spectrum of industries. 2:27 2 minutes, 27 seconds Our consolidated revenue has grown at a CGR of 30.5% since 2020 while our profits have grown 2:36 2 minutes, 36 seconds by 70.5% CAGR over the same period. 2:42 2 minutes, 42 seconds During the quarter, the company demonstrated a strong resilience and continued to outperform the industry on profitability growth. 2:51 2 minutes, 51 seconds This performance was driven by the company's focus on product development, ESGdriven innovation, and ongoing operational efficiencies. 3:01 3 minutes, 1 second In line with a commitment to employee empowerment and long-term value creation, the company granted 58,797 stock options to eligible employees. 3:12 3 minutes, 12 seconds This continues to reinforce the company's philosophy of recognizing and rewarding the talent that supports its long-term growth. 3:21 3 minutes, 21 seconds The company also declared and distributed an intering dividend of80 rupee on a face value of rupee 2 each. 3:32 3 minutes, 32 seconds The company undertook two significant corporate actions aimed at enhancing shareholder value and strengthening market participation. 3:41 3 minutes, 41 seconds First we announced a bonus issue in the ratio of 4 is to1 under which the shareholders received four additional shares of every share held every one 3:50 3 minutes, 50 seconds sharehold. In addition to the bonus issue the company also approved a subdivision of equity shares in the 3:57 3 minutes, 57 seconds ratio of 1 is to2 effectively splitting each equity share into two shares of a lower face value. Together, these 4:06 4 minutes, 6 seconds actions are designed to improve stock liquidity, make shares more accessible to a broader base of investors, and 4:13 4 minutes, 13 seconds reward our long-term shareholders for their continued trust and support. 4:18 4 minutes, 18 seconds We also strengthened our governance framework with the appointment of Mr. 4:22 4 minutes, 22 seconds Chayan Sha as a non-executive independent director of the company. Mr. 4:27 4 minutes, 27 seconds SHA brings us over 30 years of extensive experience across capital markets, institutional sales, securities, 4:35 4 minutes, 35 seconds business, business advisory and financial planning. His deep understanding of capital market strategic advisory capabilities and 4:43 4 minutes, 43 seconds strong network within the financial ecosystem will be invaluable in guiding us as we continue to scale our business 4:50 4 minutes, 50 seconds and broaden our investor base, strengthen governance practices and grow across domestic and global markets. 4:58 4 minutes, 58 seconds I would like to now hand over to Arindam G to take us through the key developments in this quarter. 5:07 5 minutes, 7 seconds Thank you RTG. Uh a very good evening and thank you everyone for joining us today. Uh quarter 2 FY26 has been a 5:17 5 minutes, 17 seconds quarter of a steady progress for Phenotex Chemical Limited. Supported by our continued focus on product 5:24 5 minutes, 24 seconds development, sustainabilitydriven innovation and discipline operational performance. 5:30 5 minutes, 30 seconds The company continues to generate rich cash flows and maintain a strong cash position providing stability and the 5:38 5 minutes, 38 seconds ability to invest in emerging opportunities. 5:41 5 minutes, 41 seconds With that volume growth across key categories has remained encouraging and our capacity enhancement plans continue 5:49 5 minutes, 49 seconds as planned supporting the next phase of scaleup. 5:53 5 minutes, 53 seconds We also maintain a strong governance record with zero consumer complaints related to restrictive or unfair trade 6:00 6 minutes practices. During FY25 and in quarter one of FY26, the company has undertaken 6:08 6 minutes, 8 seconds several CSR initiative and contributed a substantial amount towards the sorry upliftment of society. 6:18 6 minutes, 18 seconds Together, these efforts reinforce our long-term commitment to sustainable, transparent, and environmentally responsible growth. 6:27 6 minutes, 27 seconds The company recorded healthy volume growth across key product categories supported by improved demand visibility and stronger customer. 6:37 6 minutes, 37 seconds This momentum reflects the increasing acceptance of our high performance and sustainable chemistries solution in both domestic and international market. 6:47 6 minutes, 47 seconds Overall quarter 2 FY26 has been a quarter of a strong progress with healthy momentum across key segments and 6:55 6 minutes, 55 seconds sustained financial strength. I would now hand over the call to Mr. Sanjay Chibrabala to take us through the financial performance of the company. 7:04 7 minutes, 4 seconds Thank you very much. 7:06 7 minutes, 6 seconds Uh thanks Sarendam G. Good afternoon everyone. I'm pleased to share the quarter 2 financial year 26. We delivered a strong all-round performance 7:15 7 minutes, 15 seconds with clear sequential improvement across three financial metrics. Total revenue stood at 145.43 crores supported by 7:23 7 minutes, 23 seconds healthy demands across the both the domestic and international market. Our sales mix for the quarter stood at 75% 7:30 7 minutes, 30 seconds exports and 25% sorry 75% domestic and 25% expose reflecting steady traction across regions. Our profitability metrics showed even stronger traction. 7:42 7 minutes, 42 seconds Gross profit increased to 52.95 crores with a gross margin expansion sharply by 7:48 7 minutes, 48 seconds 500 basis point Q basis to 38.45 percentage compared to the 33.53 7:58 7 minutes, 58 seconds in Q1 financial 26. This improvement was driven by discipline cost controls, better raw material efficiencies and 8:05 8 minutes, 5 seconds improved product mix. On the operating front, the EVITA rose to 31.03 crores marking a 23.12 8:14 8 minutes, 14 seconds sequential increase while the IITA margin strengthened by 415 basis point to 22.53%. 8:22 8 minutes, 22 seconds Compared to 18.38%age in the previous quarter, this operating leverage continues 8:30 8 minutes, 30 seconds down the P&L with PBT rising to 35 to 35.39 crores reflecting a solid 12.4 4% 8:37 8 minutes, 37 seconds growth Qoq grow basis. Our bottom line remained strong as well with a PAT increasing to 26.08 8:46 8 minutes, 46 seconds crores reflecting a significant sequential improvement. 8:50 8 minutes, 50 seconds Basic EPS stood at 2.27 rupees per share. We continue to see strong traction in the textile segment 8:59 8 minutes, 59 seconds as well. Though it has faced a pressure from the evolving US tarif environment and a growing strong and stronghold in 9:08 9 minutes, 8 seconds the FMC and oil and gas segment both of which remains the key growth drivers forex. 9:14 9 minutes, 14 seconds Our long-term growth trajectory remains robust and innovation continues to drive our business forward. 9:20 9 minutes, 20 seconds Panotex continues to strengthen its sustainability framework through measurable improvements across CRE, environment and government parameters. 9:28 9 minutes, 28 seconds The water consumption intensity declined. Carbon emissions have remained very low in the financial year 25 reflecting a cleaner operation as well. 9:38 9 minutes, 38 seconds Our solar and solar power plant at Aman facility continues to operate successfully contributing to renewable energy adoption with our operations. 9:49 9 minutes, 49 seconds Furthermore, our continued focus on operational excellence and customer ccentric solutions will allow us to unlock new revenue streams and expand 9:57 9 minutes, 57 seconds our footprint across key and emerging markets. With a clear road map, a strong order pipeline and ongoing 10:04 10 minutes, 4 seconds diversification into high potential sectors like oil and gas. We are confident in delivering value to stakeholders and achieving our ambitious 10:13 10 minutes, 13 seconds annual growth targets. The outlook remains very highly optimistic as we continue to build momentum for the long-term success. The company is also 10:22 10 minutes, 22 seconds progressing well on the other growth initiatives. We are increasing our focus on the oil and gas segment where the company has secured several major breakthrough orders during the quarter. 10:32 10 minutes, 32 seconds On the inorganic growth front, the company is actively reviewing multiple proposals and continues to evaluate opportunities that can strengthen our portfolio and support long-term growth. 10:44 10 minutes, 44 seconds With that now I open the floor for questions. Uh thank you. Over to you Sager. 10:51 10 minutes, 51 seconds Thank you very much. We will now begin with the question and answer session. 10:56 10 minutes, 56 seconds Anyone who wishes to ask a question may press star and then one on their touchstone phone. If you wish to remove yourself from the question queue, you may press star and two. 11:08 11 minutes, 8 seconds Participants are requested to use handsets while asking a question. 11:12 11 minutes, 12 seconds Ladies and gentlemen, we will wait for a moment while the question queue assembles. Again, to register for a question, please press star and then one. 11:41 11 minutes, 41 seconds Our first question comes from the line of 11:49 11 minutes, 49 seconds man of swing from MS Capital. Please go ahead. Hello. 11:56 11 minutes, 56 seconds Yes ma. Go ahead. 11:58 11 minutes, 58 seconds Um my question like you are saying that order pipelines very strong but it's not executed in the revenue s it's a flat. 12:10 12 minutes, 10 seconds Can you please tell are the American tariffs impacting textile orders? So order line is not converting like 12:19 12 minutes, 19 seconds revenue flat water on water y is also less. Absolutely still perfect. So yeah manov yeah you rightly 12:27 12 minutes, 27 seconds said uh there is definitely an impact of the geopolitical situation. So a lot of orders which are there in the books also 12:34 12 minutes, 34 seconds lot of the customers orders have got postponed and uh so that has not been shown but the orders are there it has been just 12:43 12 minutes, 43 seconds postponed to some extent. So yes uh but at the same time as you also understand that India has tied up with UK FDA. So 12:52 12 minutes, 52 seconds lot of textile demand has come to UK as you can also rightly indicated the trend. Yes. The share of textile 12:59 12 minutes, 59 seconds chemicals this quarter was lower compared to our general textile share and uh there has been a good increase in 13:08 13 minutes, 8 seconds the of other businesses and uh we we also hope that the textile will get back to crack eventually it has back to the 13:16 13 minutes, 16 seconds place where there's no other option you know if you consider the text 13:23 13 minutes, 23 seconds you know so ultimately going to give some preference I'm sorry. 13:29 13 minutes, 29 seconds Uh sorry to interrupt Sanjay sir. Uh your audio was uh not coming clearly. It was breaking a little bit in between. 13:36 13 minutes, 36 seconds Okay. So I just repeat a few. So I'm just here has been trying in the textile mix 13:45 13 minutes, 45 seconds contribution in the quarter. However, the other industries, other businesses which we are into, oil and oil gas specialty chemicals and the cleaning and 13:54 13 minutes, 54 seconds hygiene, they have done pretty well comparatively to the previous quarter and that has given a good balance and their proportion has increased. However, 14:03 14 minutes, 3 seconds having said that, the textile business will definitely be coming back to India based on the asurances of the kind of 14:11 14 minutes, 11 seconds businesses we are expecting with the other kind of uh with the countries USA and UK as well. With UK, we have already 14:19 14 minutes, 19 seconds tied up, India has already tied up for FDA and we are very confident that even the US deal will happen soon and the companies are going to get back to track 14:28 14 minutes, 28 seconds with their other pipeline. So all in all we are seeing a good a good H2 going ahead. 14:36 14 minutes, 36 seconds Thank you. 14:38 14 minutes, 38 seconds Yeah. Our next our next question comes from the line of DK Singh from Dendra Capital. Please go ahead. 14:47 14 minutes, 47 seconds Hello. Yes. Hello. Hello. Please go ahead. 14:55 14 minutes, 55 seconds Uh yes Mr. Singh you are audible. Please go ahead with your question. 14:59 14 minutes, 59 seconds Okay sir, my question is on equa strike sir no orders yet for you said for the 15:07 15 minutes, 7 seconds whole year like 8 to 9 months are left in the last corn call any sus can you please elaborate 15:15 15 minutes, 15 seconds yeah perfect so as we have also mentioned that we are expecting good kind of businesses happening in this financial year at the same time we have 15:23 15 minutes, 23 seconds got the approvals on the product our plant is under the uh approvals of the the CIB and we have got we are awaiting 15:32 15 minutes, 32 seconds the approvals of the uh you know the plan for the production of this product as well and it will be done in India now. So we are now shifting the 15:40 15 minutes, 40 seconds production to India for this product. So there is a lot of technology transfers also happening at the other end. At the same time we are on advanced levels with 15:47 15 minutes, 47 seconds certain government authorities to and uh the products have been got very positive response from Hopkins institute as well and uh so we are very excited with that. 15:58 15 minutes, 58 seconds I am quite confident that the H2 we will surely have some orders on that from the government authorities. 16:05 16 minutes, 5 seconds Thank you so much. Thank you. 16:09 16 minutes, 9 seconds Our next question comes from the line of Aner Pitaga from AV Securities. Please go ahead. 16:16 16 minutes, 16 seconds Uh thank you for the opportunity Sanja sir. I just had a couple of questions uh regarding the warrant conversion. What is the status of the warrant sir? 16:26 16 minutes, 26 seconds Uh so basically uh there are two warrant conversions. Uh one is supposed to finish uh the deadline I think is this 16:32 16 minutes, 32 seconds Friday. Uh I mean I'm not able to uh share too much informations but we have already started getting investments 16:39 16 minutes, 39 seconds since yesterday and we are anticipating that uh we will be able to uh get substantial portion of the warrants 16:47 16 minutes, 47 seconds exercised by the investors. As of now, there's no clarity on the warrant conversion. Is that uh 16:54 16 minutes, 54 seconds as of now I am not sure whether uh we I I do not have the numbers right now in front of me and I I'm not also sure 17:02 17 minutes, 2 seconds whether that is a number which I can share with you until and unless we share with the stock exchange. So I think by Friday we'll have the updated numbers 17:10 17 minutes, 10 seconds but giving you an indication that yes we have started getting uh the remed you know we started getting the investments 17:17 17 minutes, 17 seconds uh from the warrant warrant holders and it has started coming since yesterday. 17:22 17 minutes, 22 seconds Okay. Okay sir. answer. Uh as usual the inorganic update like I also mentioned now in my last uh 17:31 17 minutes, 31 seconds stanza uh you know we are already being actively reviewing multiple proposals as usual and we continue to evaluate a lot 17:39 17 minutes, 39 seconds of opportunities. I think we are very confident to have good opportunities coming and closing down in this H2. uh 17:47 17 minutes, 47 seconds the confidence is also coming from a point of view you know this is the time when there are there is a little bit of I can I would say uh softness in the 17:56 17 minutes, 56 seconds global market in the chemicals industry and that leads to getting more opportunities and this is the right time 18:04 18 minutes, 4 seconds for any company to acquire and uh invest into assets and uh you know into the 18:11 18 minutes, 11 seconds global economy so some news in the uh second half of the here sir. 18:18 18 minutes, 18 seconds We are very hopeful about it. Okay. Okay. Yes. Yes. 18:24 18 minutes, 24 seconds Right. Thank you so much And for your time. Thank you G. Thank you. 18:32 18 minutes, 32 seconds Our next question comes from the line of Akta Mundra from Smart Sync Services. Please go ahead. 18:40 18 minutes, 40 seconds Good evening sir. Am I? Yeah. Yeah. Yeah. Please go ahead. 18:47 18 minutes, 47 seconds What percentage of your textile business is exposed by exposed by US tariff and 18:56 18 minutes, 56 seconds any kind of contract size research and a concern as a tariff uncertainity precisely and how 19:03 19 minutes, 3 seconds can you be a little louder? Can you be a little more louder? 19:08 19 minutes, 8 seconds Yeah. what kind of what percentage of your textile business is exposed by US 19:14 19 minutes, 14 seconds tariff and uh how are you supporting their customers who yeah perfect so firstly we do not so 19:23 19 minutes, 23 seconds perfect so I'll just take the couple of questions which you just mentioned so as such we do not export to USA directly number one however there are many 19:32 19 minutes, 32 seconds customers which we have in India and other countries they are working for the US markets as US is one of the biggest 19:39 19 minutes, 39 seconds consumers and uh naturally most of the chem we most of the textile companies will be depending or not even depending but will 19:46 19 minutes, 46 seconds have some kind of stake in US market. So what is happening right now we are not directly getting affected. What's 19:54 19 minutes, 54 seconds happening is the companies like let's say if I give you some names of Indian companies like wellspun, India account, simatas and other big textile companies 20:02 20 minutes, 2 seconds the face of India let's say uh these companies are having you know a time you know because their main domination was 20:09 20 minutes, 9 seconds in the US market. So once their orders get postponed to some extent which is also getting covered up by the way and 20:17 20 minutes, 17 seconds they are also able to manage their supply and with new product mix and uh other things. So there was a fee problem 20:25 20 minutes, 25 seconds there was a gap. I think the H2 is definitely going to become much better than the H1 especially for the textile industry. So this is all what we have 20:33 20 minutes, 33 seconds been doing and there has been some modifications in the product mix and uh as you know that finite has the entire 20:40 20 minutes, 40 seconds spectrum of the entire range of specialtity chemicals for textiles right from pre-treatment dying printing finishing for any fabric whichever it is 20:49 20 minutes, 49 seconds for cotton for PC for acrylic wool. So we have the kind of product range to excite the customers and cater to all 20:57 20 minutes, 57 seconds their demands. So even if there is a change in the market, if there is more demand for not 100% cotton but for 80/20 or something, we are have the product 21:06 21 minutes, 6 seconds range ready and with the great references and that helps us to you know cover up our businesses as well. 21:15 21 minutes, 15 seconds That's about it. Thank you. 21:18 21 minutes, 18 seconds Thank you. Our next question comes from the line of Anupa Magaral from Lucky Investment. Please go ahead. 21:25 21 minutes, 25 seconds Yeah, thank you. Uh hi Sanjay good evening um thank you so much for taking my question uh my first question was on 21:32 21 minutes, 32 seconds the capacity uh I believe our 16,000 ton capacity would would have started at the start of the quarter uh what was the 21:40 21 minutes, 40 seconds utilization of the 16,000 tons in this quarter. 21:44 21 minutes, 44 seconds Uh yeah so basically the way it is working is that we could enhance our capacity from mid of the last quarter. 21:53 21 minutes, 53 seconds So as such with this this quarter we have done almost let's say 15,600 22:00 22 minutes roundabout 15,600 tons versus last quarter which was 15,150 tons. So there's a let's say a growth of 3 to 4% 22:09 22 minutes, 9 seconds in the volume as such and uh yeah so everything has been done the growth is coming from the Amberat 22:16 22 minutes, 16 seconds areas where the new plant is also established and things like that we are ramping up it quite well. 22:23 22 minutes, 23 seconds Uh were there any volumes in the second quarter from the new plant which is 16,000 ton? 22:30 22 minutes, 30 seconds Oh yeah we have started uh at the same time we have started almost uh I can say we can we have touched uh we have 22:37 22 minutes, 37 seconds already used 10% of it in the you know just to because these were the initial days so naturally we cannot use the highest capacity there it takes time for 22:46 22 minutes, 46 seconds the machines for the you to make sure the pipelines are in order. So this was just 1 month or let's say 45 days we 22:53 22 minutes, 53 seconds could get. So I think H2 definitely there will be a lot of actions happening around there. Plus that that plant is 23:01 23 minutes, 1 second designed in a way where the economies of scale can be more achieved. The costings will be lower and that's also reflecting 23:08 23 minutes, 8 seconds to some extent in our in our financials of quarter three of quarter two where the gross margins are getting a little 23:15 23 minutes, 15 seconds bit better but more important is the margins has also improved. 23:20 23 minutes, 20 seconds So what if I have to take a guidance what sort of volume growth are we looking at for the FI26 over 25 given 23:28 23 minutes, 28 seconds that the capacity has come in and now stabilized as well. 23:32 23 minutes, 32 seconds See uh Anupam Generally we like in the last five years we have seen that you know we have done a growth of almost 45% 23:39 23 minutes, 39 seconds caggr and uh there were they were having challenges concage time external factors geopolitical situations now there are 23:48 23 minutes, 48 seconds times where you know as such we never lost any customer as such we never lost any product in any customer however if 23:56 23 minutes, 56 seconds the demand of the customer reduces due to geopolitical situations it really uh leads to delays and postponement of the 24:04 24 minutes, 4 seconds orders. I mean there is inventory, there are goods, there is goods lying but the customers are trying to sometimes delay it because their customers in turns are 24:12 24 minutes, 12 seconds delaying it. So right now we are hopeful that you know the this month or maybe by next month we will have some positive 24:20 24 minutes, 20 seconds news from from the USA market whereas it's concerned for the textiles when it comes to oil and gas uh we are very excited by the way on that lines and we 24:28 24 minutes, 28 seconds have done in fact our contribution on oil and gas sector we have increased uh from earlier 4% quarter 1 and now it's 24:37 24 minutes, 37 seconds almost like 7 8% and there is almost I can say a growth of 80% from the quarter one performance itself in the oil and 24:44 24 minutes, 44 seconds gas we were we have been getting great in last week also we were exhibiting in adipac in Abu Dhabi which is the biggest 24:51 24 minutes, 51 seconds oil show in on in the world and there's a lot of attention coming to India lot of demand and lot of interest has come 24:59 24 minutes, 59 seconds to India for sustainable products and also cost effective product lines and we are you know we have added more and more team members in that division that 25:06 25 minutes, 6 seconds division will be uh shaping up very uh rapidly so we are very hopeful about this division. So having said that to 25:15 25 minutes, 15 seconds come back to your question I think if you consider from today onwards I think there should be at least 15% growth rate 25:23 25 minutes, 23 seconds in the coming times also hoping that the geopolitical situations gets better for India. 25:31 25 minutes, 31 seconds Understood. Uh just on the chem on the textile chemical business uh I I believe the volumes are stagnant over the many 25:39 25 minutes, 39 seconds last many quarters on that front. uh despite a declining market so to say uh are we kind of gaining market share from 25:47 25 minutes, 47 seconds someone else are we losing market share are there other countries who are currently supplying to us given the tariff situation 25:55 25 minutes, 55 seconds so I will I will share what how what is our viewpoint about it so number one what's happening is we are gaining more 26:01 26 minutes, 1 second attention from various new customers new geographies we are increasing our manpower our investment in exhibitions even from tomorrow we have tech textile 26:10 26 minutes, 10 seconds going on next week Again there is an exhibition in this last 30 days. We have four exhibitions in four parts of the world in four different industries. So 26:17 26 minutes, 17 seconds we are growing in a way in a diversified so that we have more number of customers and more number of products also per 26:24 26 minutes, 24 seconds customer. So that's the focused business USB we have. Having said that what happens sometimes due to the consumption 26:32 26 minutes, 32 seconds decline of the customer like like in for the US market example. So we can say that you know the growth is not 26:41 26 minutes, 41 seconds reflecting directly in terms of numbers but this is something which has uh you know the action which we have taken in 26:49 26 minutes, 49 seconds the past and even now that has helped us to maintain a steady growth rate. 26:53 26 minutes, 53 seconds However, I can also mention the revenue for textile contribution in this quarter 2 was lower than quarter 1 but that's the normal way happening everywhere. So 27:02 27 minutes, 2 seconds in fact it's still much better than what we were anticipating you know in if you ask us this question in the month of 27:09 27 minutes, 9 seconds June or a you know when the the second tariff and penalties was issued on India so we were not anticipating that we'll 27:16 27 minutes, 16 seconds reach even here and going forward now what also what is happening you know if you you know what is happening is there is a gap in the supply chain already 27:25 27 minutes, 25 seconds because earlier the malls and the big uh selling brand houses like Walmart they were not buying more They were reducing the inventory because nobody wants to 27:33 27 minutes, 33 seconds pay the you know the duties and etc. But now due to the you know the supply shortage and other things which is happening in the you know the right kind 27:41 27 minutes, 41 seconds of fabrics are not available in the malls. So then there is a gap there is you know there is picking up things are getting better than before. So I think I 27:49 27 minutes, 49 seconds I can say that the work is behind us in textiles that's the way we are looking at things. 27:55 27 minutes, 55 seconds Yeah understood. If I may uh squeeze another question uh just your comments on the FMCG business uh I see some sort of 28:03 28 minutes, 3 seconds quote unquote improvement on that uh given the new GST rate cuts and everything is are you seeing some sort of demand pickup or inquiries flowing through in the FMCG business. 28:14 28 minutes, 14 seconds Yes. So generally what happens is when there is a I mean like in this case there was GST cut. So there I mean most of the FMCG companies they have two 28:23 28 minutes, 23 seconds choices either to reduce the price or to keep the same price and give a better quality product. Now that's the second part which I said is the place where we 28:31 28 minutes, 31 seconds enter because we produce a lot of performance boosters lot of surfectants lot of sustainable product lines and that is the place you know there is a 28:39 28 minutes, 39 seconds comfortable place where they are ready to use more of these products in their product line. that has helped plus there is you can say the seasonal Diwali 28:48 28 minutes, 48 seconds festival and things like that which also helps us to gain little bit more volumes on that line. So you know yeah that is 28:55 28 minutes, 55 seconds also both there are two reasons for that that's the reason you can see the growth on quarteronquarter basis on that lines understood understood I have some more 29:04 29 minutes, 4 seconds questions I'll come back in the queue thank you can complete if you want I mean it's if it's one or two sure uh sure on the gross margins I 29:13 29 minutes, 13 seconds wanted to understand so there's a drastic improvement water on water again uh is there some sort of uh uh low price 29:20 29 minutes, 20 seconds raw material benefit uh that we have maybe we had in the inventory which we've used up this quarter or is it some sort of steady state given the product mix that we have right now. 29:30 29 minutes, 30 seconds No, it's more about the product mix which has changed a bit and also the new businesses of oil and gas which is also very promising and uh yeah so these were the factors leading to it as such. 29:42 29 minutes, 42 seconds So there's no low cost inventory in the in the quarter two. 29:46 29 minutes, 46 seconds No, no, not at all. No, not at all. But you know also in the past if you see always our profitability was I mean the gross margins were always around 35%. 29:54 29 minutes, 54 seconds and 35 to 38 was the general thing. If you in fact even if you see our books for the last uh 11 years not 11 years 30:02 30 minutes, 2 seconds sorry last 14 years of being listed 56 quarters you will always see our gross margins has been uh at least 30% to 40% 30:10 30 minutes, 10 seconds generally and theas have always been minimum 17% in any of the quarters of the last 56 quarters of being listed. So I think 30:19 30 minutes, 19 seconds yeah these are like certain times you are some orders gets postponed sometimes you get more orders of the products which have more ITA. So the product mix 30:27 30 minutes, 27 seconds keeps changing. What is important is that we have the entire range of product lines which excite the customers and we can engage the customers give them the 30:36 30 minutes, 36 seconds best sustainable solutions and the kind of R&D efforts and investments which we keep doing and developing more and more solutions that is something which keeps 30:44 30 minutes, 44 seconds us on the edge and the customers are very uh satisfied with our you know the solutions and the product lines. 30:51 30 minutes, 51 seconds Understood. Understood. Thank you so much Sanjay. Hoping to see a good second half and wishing the entire team all the best. 30:59 30 minutes, 59 seconds Thank you Anupamji. Thank you so much. 31:03 31 minutes, 3 seconds Thank you. Our next question comes from the line of love Gupta from CounterCyical Investments. Please go ahead. 31:11 31 minutes, 11 seconds Um hi sir uh thank you for the opportunity. So uh I just wanted to understand our newer segments like oil 31:18 31 minutes, 18 seconds and gas, water treatment, uh aqua strike. what sort of uh revenue contribution can we expect from these 31:25 31 minutes, 25 seconds segments going forward and about like a approximate year on year growth rate from these new se new year segments. 31:34 31 minutes, 34 seconds Uh thanks Mr. Gupta. So I am uh so I mean if historically if you see the last 14 years of our performance our company 31:42 31 minutes, 42 seconds has grown PGR 14 years by 30% last 5 years has been incredibly nice for 31:48 31 minutes, 48 seconds almost 40% growth something like that uh I mean it doesn't mean that every year we'll have the same kind of run rates uh 31:56 31 minutes, 56 seconds but uh yes if you al you know in the the minimum growth rate which we generally have is almost uh 15 to 20% year-on-year 32:03 32 minutes, 3 seconds basis. Now we have been working investing adding more manpower and uh businesses for a cost strike for oil and 32:12 32 minutes, 12 seconds gas for cleaning and hygiene. I can say that you know we are working with the best biggest brands oil and gas in in 32:19 32 minutes, 19 seconds the cleaning and hygiene areas in textiles. We are already a brand leader here and we are enjoying the brand value also and that is also one of the reasons 32:28 32 minutes, 28 seconds why we have better ITA than any other company in the industry. So it's it's not very easy to answer your question 32:35 32 minutes, 35 seconds numerically but I would say that average generally we always anticipate a growth of 20% year on year and that's the place 32:44 32 minutes, 44 seconds uh we always aspire our team is always looking at and if if it it's not happen in one year then the second year takes 32:52 32 minutes, 52 seconds care of the last two years also growth rate. So that's something which I can share with you. 32:57 32 minutes, 57 seconds All right. And these uh newer segments are the margins better or at similar levels comparative levels? The gross 33:06 33 minutes, 6 seconds margins definitely better and uh yeah so that's about it. No I mean for the detergents the gross margins are much 33:14 33 minutes, 14 seconds better. The reasons are also that I mean detergents I mean we have two subvertical one is the branding one and one is the place where we are supplying 33:22 33 minutes, 22 seconds to FMCG ones. If you talk about the branding ones, there is a big higher gross margins. But if you talk about the 33:28 33 minutes, 28 seconds FMCG ones where we supply our speciality performance boosters to FMCG company, it's more or less in the same uh maybe a 33:36 33 minutes, 36 seconds little lower gross margins but then the ITA margins is something which we have to focus upon. That's the way we look at our businesses. So ultimately what is 33:45 33 minutes, 45 seconds how we look at our business is uh is on the ITA margins and that's something has to be uh well taken care of and and this 33:53 33 minutes, 53 seconds this business is growing actually it's a transitional level where it is today. So we are just uh looking at and very much 34:00 34 minutes optimistic and excited about what's unfolding for us in the new divisions. 34:07 34 minutes, 7 seconds All right. So so just one last question from my side. So what sort of a sustainable aida margin can we expect for the whole year? 34:18 34 minutes, 18 seconds I mean if you see our his historic uh performances you know it's always around uh 22 to 23% that's the general uh if 34:28 34 minutes, 28 seconds you see an average we are always here sometimes it has become 27% sometimes it has become 19%. So it it it also depends 34:36 34 minutes, 36 seconds on what kind of product mix and trends are continuing in the industry. If there are more speciality in age products which are in demand so we will have more 34:43 34 minutes, 43 seconds or you know we have the increase in the beta margin and so on that line so it will be never because you know we have more than 1500 SKUs we have more than 34:52 34 minutes, 52 seconds 500 approximately product categories it's it's the entire basket of product lines there are trends of the product mix which keeps changing and so our 35:01 35 minutes, 1 second product also changes the profitability of it also has a has a deviation on that all Right. Understood. Thank you so much. Thank you Mr. Gupta. 35:13 35 minutes, 13 seconds Thank you. Before we take the next question, a reminder to all the participants, you may press star and then one to ask a question. Our next 35:21 35 minutes, 21 seconds question comes from the line of part K and Modi from Equius. Please go ahead. Uh 500 I'm audible. 35:29 35 minutes, 29 seconds Yeah, audible. Yeah. Uh first of all a clarification that uh you mentioned oil and gas contributed 7% in this quarter is my understanding correct. 35:40 35 minutes, 40 seconds Yes. Hello. Yes. Yes. Yes sir. You're right. 35:46 35 minutes, 46 seconds Okay. Okay. So 10 odds will be from this segment and how much could you share the order book and potential revenue from 35:53 35 minutes, 53 seconds this vertical uh for the whole year and next couple of years? I mean this is a division which we had just uh you know 36:00 36 minutes it's not even two years and there is a lot of actions happening so so I mean it's very tough to estimate right now 36:07 36 minutes, 7 seconds what's going to unfold if you if you you know if you see our health and hygiene division in in the year 21 in fact December 21 our health and hygiene 36:17 36 minutes, 17 seconds sector was only 3% of the total business and then it became to a level where it became almost 40%. And that was that I 36:26 36 minutes, 26 seconds mean 40% but the overall growth was also there that also has doubled in the last 3 years the sales from 21 to 24. Uh so 36:34 36 minutes, 34 seconds basically you know these are the new drivers. We are very optimistic. It's very difficult to say whether it will become 100 crores or 500 crores or 200 36:43 36 minutes, 43 seconds crores wherever it goes to. But I think there is a lot of interest coming in from the customers. We are very much uh 36:50 36 minutes, 50 seconds excited about the kind of uh requirements which are coming in and we are adding more and more manpower to cater to the demand on that in for the 36:59 36 minutes, 59 seconds marketing and uh for the product development. So that's the way it is. 37:03 37 minutes, 3 seconds There are a lot of approvals by the way this industry is not about you know even if the product is approved it doesn't mean anything by the way because until 37:11 37 minutes, 11 seconds unless the contracts are over which are lying for 2 years 3 years 4 years it's a very long process even if uh you are in the you know the product is approved it 37:19 37 minutes, 19 seconds has no meaning at all until unless the the renewals come in and uh so so the gestation period in this line is 2 to 3 years so that's the way it works. 37:31 37 minutes, 31 seconds Oh okay. Okay. Thank you so much. That will give up. Thank you so much part. Thank you. 37:40 37 minutes, 40 seconds Our next question comes from the line of Rahul Kotari an investor. Please go ahead. 37:47 37 minutes, 47 seconds Uh hi I just wanted to know the revenue break up into textile FMCG and oil and gas and uh also if we are seeing any 37:54 37 minutes, 54 seconds opportunity in defense sector uh maybe couple of years down the line. Yeah. 38:01 38 minutes, 1 second Uh sorry Rahul could you repeat your first question first is the breakup you requ you you asked for right so 80% is more or less oh no sorry now it's 74% is 38:09 38 minutes, 9 seconds uh textiles broadly and uh so yeah 75% let's say and let's say 10 7% is uh oil 38:18 38 minutes, 18 seconds and gas 7%. and the rest is uh on the other industries. 38:26 38 minutes, 26 seconds Okay. And uh next question is like uh are you looking for any opportunity in opportunity in defense sector? 38:32 38 minutes, 32 seconds Oh defense. Okay. So basically what happens if you so defense definitely helps our product lines and product 38:40 38 minutes, 40 seconds segment. Most of the defense fabric they require lot of technical finishes which is water repellence all repellent bread 38:47 38 minutes, 47 seconds vaporance anti-flammability and our biotech arm producing which the German technology made in Malaysia where 38:55 38 minutes, 55 seconds we want 72% stake is specialized on technical textiles. Now many of the in fact from tomorrow the exhibition is 39:04 39 minutes, 4 seconds starting in the scope for 3 days for technical textile where finite tech is also exhibiting. We all will be there meeting the new I mean the new demands 39:11 39 minutes, 11 seconds and the new trends in the defense sectors for the fabrics for canvas stands for the parachutes fabrics and other things and all of these are 39:19 39 minutes, 19 seconds generally to be treated by chemicals not mechanically I mean mechanically is there but these finishes are impacted these technicalities and performance 39:27 39 minutes, 27 seconds comes into the fabric by the use of chemical we are already strong in that segment and the more and more such kind 39:35 39 minutes, 35 seconds of businesses develops and the consumption of these chemicals always going higher for that. So indirectly yes we are catering to those demands also 39:44 39 minutes, 44 seconds there is a lot of demand in Brazil for these kinds of defense fabric in Turkey and also in India there are so many 39:50 39 minutes, 50 seconds technical textile companies like uh as you must be know Kusungar and others. So they have been growing quite well in the 39:58 39 minutes, 58 seconds defense sector for the government supplies and we are one of the suppliers to these such kind of industries. 40:07 40 minutes, 7 seconds Okay, thank you. Thank you so much. Thank you. 40:17 40 minutes, 17 seconds A reminder to all the participants, you may press star and then one to ask a question. 40:31 40 minutes, 31 seconds Our next follow-up question comes from the line of man of Singh from MS Capital. Please go ahead. 40:38 40 minutes, 38 seconds Yes sir. Sir my question is sir sir for the rest of the quarter like you say for the Q3 how are you seeing the textile 40:46 40 minutes, 46 seconds and what will be the revenue you're saying that it will be grow how how you see the traction of revenue m the environment for the business my question 40:55 40 minutes, 55 seconds will be that for textile oil and gas you have said it's a foreign type of for textile how we are you seeing the 41:02 41 minutes, 2 seconds environment in domestic market I can uh you know I can clearly see that H2 is going to become better than H1 41:10 41 minutes, 10 seconds that's the trend which we are very you know we are already looking at things and we are already confident on that uh yeah so whether it will happen directly 41:19 41 minutes, 19 seconds now or in next month or next next month is something which is not we are not able to get right now because there are 41:27 41 minutes, 27 seconds not not I mean this is the way it is at the same time we will not be able to diverse a lot of informations about this quarter going on but yeah things are 41:35 41 minutes, 35 seconds getting nicer for the overall industry And uh H2 is definitely going to become better than H1 for the textile companies in general in India. 41:45 41 minutes, 45 seconds Uh uh you said Equestrike will be able to get orders this quarter or next quarter like in summer your product will 41:52 41 minutes, 52 seconds be more useful like you said for the Indian governments where there is obviously for mosquito it is can you 42:00 42 minutes please shed some light on it? Yeah, like I also mentioned in this uh in this uh meeting today uh to all the participants 42:08 42 minutes, 8 seconds that yeah, we are very hopeful and confident that in H2 we'll definitely crack good uh you know the the miden 42:15 42 minutes, 15 seconds orders from the government of India into uh for the first strike and other things. So that's the way we would like to take it ahead. 42:23 42 minutes, 23 seconds Yes, please. Thank you. 42:27 42 minutes, 27 seconds Participants you may press star and then one to ask a question. 42:54 42 minutes, 54 seconds As there are no further questions from the participants, I now hand the conference over to Mr. Sanjay Depraala for closing comments. 43:02 43 minutes, 2 seconds Uh thank you everyone and uh we hope you able to give some more of that. We are very accessible. You can 43:11 43 minutes, 11 seconds always contact our investor relation company at factors or write to us on investor.reations.com. 43:18 43 minutes, 18 seconds Uh have a good evening. We will be continuing to do our best and we'll keep updating all the investors time to time from the on the stock exchange and 43:27 43 minutes, 27 seconds whenever we have any announcement coming up. Thank you so much. 43:32 43 minutes, 32 seconds Thank you on behalf of Finiteex Chemical Limited. That concludes this conference. 43:38 43 minutes, 38 seconds Thank you for joining us and you may now disconnect your lines. Thank you.