Gabriel India Limited — Q3 FY26

Gabriel India Ltd Q3 FY2025-26 Earnings Conference Call https://www.youtube.com/watch?v=mDvcwZ9CcUI Published: 3 months ago

0:00 Ladies and gentlemen, good day and welcome to Gabriel India Limited Q3 SI26 earnings conference call. This call may 0:08 8 seconds contain forward-looking statements about the company that are based on the beliefs, opinions, and expectations of the company as on date of this call. 0:18 18 seconds These statements are not guarantees of future performance and involves risk and authities that are difficult to predict. 0:26 26 seconds As a reminder, all participants line will be listeningly board and there will be an opportunity for you to ask question after the presentation 0:34 34 seconds concludes. Should you need assistance during this conference call, please signal an operator by pressing star then zero on your touchdown phone. Please 0:43 43 seconds note this conference call has been recorded. I now hand over the call to Mr. Arul Jagi, managing director from 0:50 50 seconds Gabriel India Limited. Thank you and over to you sir. 0:56 56 seconds Thank you. Uh good evening and a very warm welcome to everyone on the call. 1:02 1 minute, 2 seconds Although it's a bit late uh as this is our first interaction in the new year. I would first like to extend my warm new year wishes to all the participants. 1:11 1 minute, 11 seconds Wishing everyone a very happy new year joining uh the call today. Uh with me today uh we have Mr. Mind Go CEO, Mr. 1:20 1 minute, 20 seconds Mr. Mo Shirvasta our CFO, Mr. Nilles Jan our company secretary and SGA our investor relation advisor. We have 1:28 1 minute, 28 seconds uploaded our results and investor presentation for the quarter ended 31st of December 2025 on the stock exchanges 1:36 1 minute, 36 seconds and on the company's website. Hope each one you each one of you had a chance to go through the same. Let me start by highlighting a few recent developments. 1:47 1 minute, 47 seconds the conclusion of long pending uh India EU free trade agreement after nearly two decades of uh negotiation 1:55 1 minute, 55 seconds uh for the auto component. It create opportunities in export technology partnerships and investment positioning 2:02 2 minutes, 2 seconds India as a trusted manufacturing and sourcing partner for European OEMs amid diversifying global supply chains. 2:11 2 minutes, 11 seconds Additionally, US India trade deal announced yesterday reduces reciprocal tariffs from 25% to 18%. With the 2:19 2 minutes, 19 seconds agreement expected to be finalized soon together, these deals are a major boost for the Indian economy driving capacity 2:26 2 minutes, 26 seconds expansion, greater MSEM involvement and a growth of industrial clusters in key states. Union budget 2627 arrives at a 2:36 2 minutes, 36 seconds great time with strong growth, low inflation and robust capex as the country aims to become the world's third 2:43 2 minutes, 43 seconds largest economy. The auto sector already number one in two-heer, three-wheeler and number three in car trucks receive 2:50 2 minutes, 50 seconds strong support to increase PLI funding, electronic init in incentives, duty cuts on EV materials and new mineral 2:58 2 minutes, 58 seconds corridors to lower cost and accelerate local manufacturing. 3:04 3 minutes, 4 seconds Let me now turn to our company's performance and share a brief overview of our operations and key highlights. 3:11 3 minutes, 11 seconds In Q3 FY26, our standalone operating revenue grew by 16% Y reaching 2,72 3:18 3 minutes, 18 seconds crores supported by higher volumes and strong sales performance in all our segments. AITA grew by 21% yearonear 3:26 3 minutes, 26 seconds reaching 96 crores with margins improving from 8.6% in Q3 FY25 to 9% in Q3 FY26. 3:36 3 minutes, 36 seconds This improvement in margin is attributable to higher volumes and the continued impact of our operational 3:43 3 minutes, 43 seconds excellence initiative under the core 90 program. As per the new labor code act, the one-time impact of 13 cr has been 3:51 3 minutes, 51 seconds accounted as an exceptional item. Uh this impact has been optimized pursuant to our conscious efforts in the past to 3:58 3 minutes, 58 seconds streamline the components of salary in line with the wage work. Moving on to the business wins. Uh this quarter has 4:06 4 minutes, 6 seconds seen really good progress being made in the stand standalone business uh with winds flowing in CV uh two-heer solar 4:16 4 minutes, 16 seconds and ebike segment. Specifically in the two-heer I'm very happy to announce that uh we have made inroad into Heromoto 4:24 4 minutes, 24 seconds Corporation. I think this has been a point of discussion for quite some time and we also have additional business 4:30 4 minutes, 30 seconds wins on uh inverted front folks with uh multiple customers on the ebike segment. Again happy to 4:38 4 minutes, 38 seconds share that we've received our first development orders from a customer in Europe. With respect to solar dampers we are progressing well on multiple fronts 4:46 4 minutes, 46 seconds with samples submitted for validation to two customers and feedback being awaited from them. Additionally, there are two 4:53 4 minutes, 53 seconds more uh developments uh under progress in Q3 FY26. 5:00 5 minutes Uh in Alpha, Gabriel's Sunroof System, Private Limited reported revenue from operations of 107 crores and AITA margins at 13.5%. 5:10 5 minutes, 10 seconds Uh with respect to the uh business wins in the sunroof segment, very happy to share that IGS has won new business uh 5:18 5 minutes, 18 seconds with uh Hyundai for three model variants. Uh this is in addition to already shared models under development with both Kia and Hyundai. 5:30 5 minutes, 30 seconds On a consolidated basis, our quarterly revenue stood at 1179 crores, showcasing an impressive growth of 16% on Y basis. 5:39 5 minutes, 39 seconds AITA for the quarter stood at 111 crores with margin standing at 9 9.4%. 5:45 5 minutes, 45 seconds Adjusted pad after excluding one-time exceptional expenses of 13 crores for the quarter was 68 crores marking a 13% Y growth. 5:56 5 minutes, 56 seconds uh coming to 9 months uh performance uh for FY26 for the consolidated revenue stood at 3,457 6:05 6 minutes, 5 seconds crores reflecting a growth of 16% as compared to uh 9 months period for FY25. 6:12 6 minutes, 12 seconds Abita stood at 335 crores marking a growth of 19% on Y basis with margin standing at 9.7%. 6:21 6 minutes, 21 seconds that after excluding one-time exceptional expenses of 13 crores stood at 199 crores marking a notable growth of 10%. 6:31 6 minutes, 31 seconds Coming to the industry highlights, the auto industry delivered a strong Q3 FY26 performance with total sales up uh 18.9% 6:39 6 minutes, 39 seconds while the production volumes were up by 16% uh to 9.2 million units. This was driven by broad-based growth across segment festive demand GST uh cuts. 6:51 6 minutes, 51 seconds Export uh surged 24.7% to 1.7 million units reinforcing India's growth growing 6:58 6 minutes, 58 seconds role as a global manufacturing and export hub. 7:02 7 minutes, 2 seconds Uh Q3 FY26 two-heer segment posted a strong 18% growth reaching 7 million units uh one 7:10 7 minutes, 10 seconds of the best quarterly performance in the uh recent few years. 7:16 7 minutes, 16 seconds On three-wheelers, the segment grew by 29.9% to 3.5 4 lakh units driven by higher demand in passenger and good 7:24 7 minutes, 24 seconds segment. A better supply chain and export surging 70% year on year to 1.3 lakh unit. Coming to the passenger 7:31 7 minutes, 31 seconds vehicle, uh the segment achieved a historic high with total sales reaching 1.5 million units up 19% yearonear 7:39 7 minutes, 39 seconds driven by sustained SUV UV demand. a meaningful revival in the entry level uh and small car strong festive momentum 7:47 7 minutes, 47 seconds GST rationalizes and and easier financing uh the commercial vehicle segment again 7:55 7 minutes, 55 seconds uh stage a strong recovery with 20 around 21% year-on-year growth to nearly 3.1 lakh unit making one of the best 8:02 8 minutes, 2 seconds quarterly performance recently led by higher freight movement and rising infrastructure activities the Indian auto industry is expected to keep up the 8:10 8 minutes, 10 seconds strong double digit growth momentum in the quarter 4 also. On that note, I come to the end of my opening remarks. I now 8:18 8 minutes, 18 seconds request the moderator to begin the question and answer session. Thank you. Thank you very much. 8:26 8 minutes, 26 seconds We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on 8:32 8 minutes, 32 seconds their touchstone telephone. If you wish to remove yourself from the question, you may press star and two. Participants 8:40 8 minutes, 40 seconds are requested to use answers while asking the question. Ladies and gentlemen, we will wait for a moment while the question get assembled. 8:55 8 minutes, 55 seconds The first question is from the line of mum from Anandrai in institutional equities. Please go ahead. 9:02 9 minutes, 2 seconds Yeah. Uh thank you sir for the opportunity and uh new year wishes to the management and good to hear uh new sunroof and hero orders. 9:11 9 minutes, 11 seconds Thank you. 9:12 9 minutes, 12 seconds Uh sir uh sir firstly if can give more flavor on this new orders uh it seems major orders. uh if you can help us 9:19 9 minutes, 19 seconds understand what kind of timeline would be there uh in the sunroof side uh uh this three uh variants uh is it a half 9:27 9 minutes, 27 seconds sunroof full sunroof and when the business starts uh if you can also give more favor on the business side 9:34 9 minutes, 34 seconds potential for these two orders uh okay sure 9:40 9 minutes, 40 seconds so uh uh this is as I said uh this is uh uh a Hundai order win with three variants 9:47 9 minutes, 47 seconds uh the Uh this is a TVS uh type of sunroof. Uh the total volume expected is 9:54 9 minutes, 54 seconds 130,000 uh with an annual turnover of roughly around 120 crores. Uh the start 10:03 10 minutes, 3 seconds of production is expected to be by December of 20 uh 2027. 10:13 10 minutes, 13 seconds Great. Great. And for the uh hero or We are already developing uh we are 10:21 10 minutes, 21 seconds already developing one model uhly with them the uh we are working on the SOP 10:29 10 minutes, 29 seconds date I think I'm expecting the start of production to start by end of quarter 1 financial year or maybe start of quarter 10:36 10 minutes, 36 seconds two uh and then there are a couple of models under discussion so as of now there is one uh one win uh but then now 10:45 10 minutes, 45 seconds since the the account is open uh I We are expecting more uh orders to flow in. 10:50 10 minutes, 50 seconds We are already in discussion on couple of new uh further models. 10:58 10 minutes, 58 seconds Great great to hear that sir. Uh so on the uh sunroof uh second line expansion has that started now and uh uh how's the ramp up planned up for that uh capacity? 11:11 11 minutes, 11 seconds Yeah. So, uh as I've shared earlier uh while the second line investment has uh has happened uh but because of one of 11:19 11 minutes, 19 seconds the models uh the cyros which was not doing well the second utilization was not great. uh so one I think we are we 11:28 11 minutes, 28 seconds are waiting for a refresh of that model around March or April uh which would improve the utilization of the second 11:34 11 minutes, 34 seconds line but uh uh we we intend to make that line as hybrid and with the recent wins 11:41 11 minutes, 41 seconds uh the uh few models under development that I had already shared with you and then this the the recent business 11:50 11 minutes, 50 seconds acquisition we are looking at a a very good utilization of the second line moving forward. what uh there so 11:58 11 minutes, 58 seconds so the second line will get converted into hybrid line to ensure that we can make BLT as well as the TVS types sun roofs and uh so utilization will not be 12:07 12 minutes, 7 seconds a major issue moving forward once this model come into the play. 12:13 12 minutes, 13 seconds Got it sir. Uh finally sir uh just on the financial part uh uh this quarter uh the expenses increased by 8 cr Q 8 cr 12:23 12 minutes, 23 seconds any nature of the increase sir uh and any one off per say on M&A part uh which are we doing uh in the numbers sir 12:32 12 minutes, 32 seconds yes so uh yeah so the the increase uh uh is primary uh in the other cost uh is 12:41 12 minutes, 41 seconds for two reasons one is the enhanced technical support from the partner uh where we would like to expedite the new business supports and localization 12:49 12 minutes, 49 seconds support to improve the uh the localization in India to reduce the RMC percentage on the sunroof business. Uh 12:57 12 minutes, 57 seconds this is also evident from the recent business wins and our increased customer engagement with the other OEMs. Uh and 13:05 13 minutes, 5 seconds uh second on the account of the restructuring cost basis the uh the milestones. So these are the two reasons 13:12 13 minutes, 12 seconds uh while why we see uh an increase in the cost. 13:16 13 minutes, 16 seconds So broadly this a one time sir uh it is a mix of uh one time and uh recurring technical support moves. 13:26 13 minutes, 26 seconds Got it. Got it sir. Thank you so much. I'll come back for the questions. Thank you. Thank you so much. Thank you. 13:34 13 minutes, 34 seconds The next question is from the line of Nikil from SIMPL. Please go ahead. Yeah, good evening and congrats on both such numbers. I hope I'm audible. 13:44 13 minutes, 44 seconds Yes. Yes. Yes. Nik. 13:46 13 minutes, 46 seconds Yeah. Uh, two questions, sir. One is if we look at the two-heer industry and map it against our growth in the two-heer 13:55 13 minutes, 55 seconds and same in the passenger vehicle. It seems we've lost some shares. 13:59 13 minutes, 59 seconds uh if you can just say like share your thoughts on what has led to a lower growth versus the industry growth or the 14:07 14 minutes, 7 seconds production growth for both two wheeler and PV for us. 14:13 14 minutes, 13 seconds Uh so uh uh Nikl thanks. Uh uh so in terms of the uh loss in share there's no loss in the market share that is there. 14:22 14 minutes, 22 seconds If you look at the production numbers yes uh uh this quarter we see against the two wheeler if you see the uh the production while the sales number are 14:31 14 minutes, 31 seconds different but obviously we go with the production numbers. So the market has grown between 15 to 16% the grial growth 14:38 14 minutes, 38 seconds is around 13%. Is primary because of two reasons. one this quarter the hero growth has been much higher than in the 14:45 14 minutes, 45 seconds previous quarters and secondly I think it is a mix of the it is more to do with the model mix uh factor that that is 14:53 14 minutes, 53 seconds there but uh there's there's nothing abnormal uh rather in this segment as I mentioned I think we had further 15:00 15 minutes business wins uh with multiple customers including TVS Bajage Kawasaki 15:07 15 minutes, 7 seconds uh and a couple of other customers so we we have a solid business pipeline uh that is there in the two-heer especially on the inverted 15:16 15 minutes, 16 seconds front folks. Uh on the passenger car side uh I think again our share of business with MSI continues to improve 15:23 15 minutes, 23 seconds uh but uh again uh you see in this particular quarter the growth with Tata and Mahindra uh is there and uh it is 15:32 15 minutes, 32 seconds again a model mix uh issue. If we take out the MMA part because if we take out the models that we are supplying from uh 15:39 15 minutes, 39 seconds the uh the Chakun 2 facility then we are obviously in line with the market. 15:46 15 minutes, 46 seconds So M&A is purely on the EV side. Oh, there are there are some models that we are supplying uh in the passenger car 15:55 15 minutes, 55 seconds side from there uh like Tata Harrier is there, Safari is there, Nexon is there 16:02 16 minutes, 2 seconds uh both for EV and I okay on this the new initiatives on 16:08 16 minutes, 8 seconds dampeners and the ebikes like what is the progress and when do you see commercializations? 16:14 16 minutes, 14 seconds Yeah. So as I shared uh again finally uh I think uh we were always discussing about development of the ebike folks as 16:23 16 minutes, 23 seconds I as I mentioned in the opening remarks that I'm happy to share that we have secured our first uh uh orders win. Uh 16:32 16 minutes, 32 seconds we uh currently uh the sort of the development uh orders are being released by the customer. This is uh for an ebike 16:40 16 minutes, 40 seconds in Europe uh for an upside down front. a good good technology product uh and we are looking forward uh the start of 16:49 16 minutes, 49 seconds production expected is around I think the quarter three uh because now the development will start and around 16:56 16 minutes, 56 seconds quarter three of the uh the next year we will be seeing the start of production. 17:02 17 minutes, 2 seconds Uh there are certain other businesses under discussion but uh the LOI is not received for them. I will keep sharing the progress. 17:12 17 minutes, 12 seconds Okay. And the solar temperature solar as I said two there are three business wins already uh two products 17:19 17 minutes, 19 seconds are under develop uh under validation with the customer one is under development. So once the validation happens we will get into the uh the mass production timeline. 17:30 17 minutes, 30 seconds So I think in last call we mentioned uh commercial should start first quarter or second quarter. So are 17:38 17 minutes, 38 seconds those timeline still meeting or is there a delay there? Sorry NL I think your voice is cracked. Can you repeat? 17:45 17 minutes, 45 seconds Uh I think our uh last call our idea was we should see commercialization of solar 17:53 17 minutes, 53 seconds damp planet FI27 I think first half definitely. Is there some delay there or 18:00 18 minutes No, we we are on track as I said I think uh the validation is on for a couple of the models once it is done we will uh get into the mass production timeline. 18:10 18 minutes, 10 seconds So as of now there's no delay rather I would say that with the with the tariff uh being changed for the US market uh 18:18 18 minutes, 18 seconds I'm I'm really positive about because North America is a big market I'm I'm very optimistic about more traction from 18:26 18 minutes, 26 seconds the customers on this okay just last request sir see we are merging all the entities and like in Q1 18:34 18 minutes, 34 seconds we had shared their proform numbers I think if we can share the performance numbers on a quarterly basis. It will be 18:42 18 minutes, 42 seconds really helpful to the investors. Um just a request and if you can just think about it. 18:49 18 minutes, 49 seconds Yeah. No, take the point. Uh we are uh as you know we are progressing very well on this on the restructuring part. Uh 18:57 18 minutes, 57 seconds I'm sure we will we'll start uh disclosing uh the numbers uh in all the quarterly uh sort of calls moving 19:05 19 minutes, 5 seconds forward once uh we go through the entire process. I think we are quite close to it. 19:11 19 minutes, 11 seconds I'll come back. Thanks. Thank you. 19:17 19 minutes, 17 seconds The next question is from the line of Adita Ketan from SMFS Institution Equities. Please go ahead. 19:24 19 minutes, 24 seconds Yeah, thank you sir for the opportunity. 19:26 19 minutes, 26 seconds So just a couple of questions. So onto the Sun as you had mentioned earlier. So uh last quarter we had mentioned that uh 19:34 19 minutes, 34 seconds so Cyros is not picking up which is why we were facing some volume losses. Now you're saying like with this new order wins it would largely offset and you're 19:43 19 minutes, 43 seconds using that line as a hybrid. So any uh any guidance you can give like how much uh we could recoup uh the volumes which 19:52 19 minutes, 52 seconds were earlier lost because of cyros and uh what sort of numbers should we build in for FI27 and FI28. 20:01 20 minutes, 1 second See uh I will not be able to give you the numbers for FY27 because forward looking projections normally we don't 20:08 20 minutes, 8 seconds give uh bases the uh uh uh I think two things are there we have always 20:15 20 minutes, 15 seconds mentioned that uh by say 2030 31 around that number we are uh with now with the winds that we have seen recently I think 20:24 20 minutes, 24 seconds we one thing I can confirm that we are on track uh on the on the projected number in the long run uh in the short 20:32 20 minutes, 32 seconds run uh since there has always been a discussion on the utilization of the second line with this recent uh uh win 20:40 20 minutes, 40 seconds on the TVS side we are uh because the first line is completely utilized uh now we have uh uh uh three variants coming 20:49 20 minutes, 49 seconds in and then two models under development. So we are looking at a more comfortably more than around 60 to 70% 20:56 20 minutes, 56 seconds utilization on the second line also moving forward. 21:03 21 minutes, 3 seconds Got it. So the new order wins in into the sunroof uh is it superior in terms of margins in terms of pricing or aida 21:11 21 minutes, 11 seconds for sunroof compared to the base business what we have in phase one? I will I will not be able to share the margin profile because obviously as you 21:19 21 minutes, 19 seconds know in when the model is under development uh multip it goes through multiple changes iteration but obviously 21:26 21 minutes, 26 seconds uh any uh any business win when it meets our threshold uh then only we uh we go 21:34 21 minutes, 34 seconds for the acceptance of the loi. So uh that is generally as per the uh as per the policy. 21:43 21 minutes, 43 seconds Got it. Uh in this quarter the so the two wheeler segment share has dropped to 61% versus 65% last quarter. Is there any change? 21:56 21 minutes, 56 seconds Uh I think we lost you. Can you hear me? Hello. Hello. Yes sir. Are you audible? 22:05 22 minutes, 5 seconds uh see uh obviously uh uh because the MMA numbers also uh come 22:13 22 minutes, 13 seconds into the play which is primarily on the uh on the PC side the CV uh that would 22:20 22 minutes, 20 seconds change the uh the uh I would say the overall distribution of the 22:28 22 minutes, 28 seconds yeah so those numbers are much higher and they are all in the passenger car that is why you see there and as as I 22:36 22 minutes, 36 seconds mentioned earlier the market in the two wheeler has grown by 15% because of the model mix and the hero extra growth 13%. 22:44 22 minutes, 44 seconds So maybe one odd percent is from quarter is coming from the the model mix and 2% is coming primly from the uh the 22:53 22 minutes, 53 seconds increased passenger car and commercial affordable got it s one last question sir so during 23:01 23 minutes, 1 second the quarter other expenses have also gone up is there some burnoff into that so as I I have already answered this 23:08 23 minutes, 8 seconds question in detail uh when mumuk asked this so it is basically a mix of both and it is on account of two things. 23:17 23 minutes, 17 seconds One is on the uh the increased uh technology support from the partner uh on localization on design and 23:25 23 minutes, 25 seconds development on the sunroof and second is on the restructuring. So that is that is how you see uh an increase in the uh uh the cost. 23:37 23 minutes, 37 seconds Got it. Got it. Thank you. Thank you. Thank you. Thank you. 23:44 23 minutes, 44 seconds The next question is from the line of AIT Hanandani from Philip Capital. Please go ahead. Yes sir. Thanks for the opportunity sir. 23:53 23 minutes, 53 seconds Uh sir basically hi sir. So first basically how best uh the company will be able to utilize these ongoing FTAs 24:02 24 minutes, 2 seconds because we have a target to increase our exports. Uh so your take on this please. 24:08 24 minutes, 8 seconds Yeah so uh two uh two parts of it. uh one uh is uh when we look at the uh uh 24:16 24 minutes, 16 seconds the uh deal with the Europe FTA with Europe uh you know we already have our tech center there uh we have an entity 24:24 24 minutes, 24 seconds where we are working on various technologies I think with uh this would help us uh enhance the technology 24:31 24 minutes, 31 seconds support there uh definitely uh find more avenues uh on the technology front 24:38 24 minutes, 38 seconds number one number two definitely uh uh the uh because of the change in the duty the FDA coming in clearly you compensate 24:47 24 minutes, 47 seconds on the transportation cost of it. So you are uh the competitiveness uh goes up. So we are looking at uh 24:54 24 minutes, 54 seconds building uh on it just to share with you while it is too early but just after this has announced I think we already 25:02 25 minutes, 2 seconds have got couple of meeting requests from customers in Europe uh to have discussions on it. Clearly not only us 25:10 25 minutes, 10 seconds but the the customers in Europe are also looking positively at India. Uh this is on one part. Uh secondly uh you know uh 25:19 25 minutes, 19 seconds because of the additional tariff the the whole sun the solar damper thing that we were quite optimistic about slowed down 25:27 25 minutes, 27 seconds in North America and then we started focusing more in Europe. uh now with the yesterday's announcement I'm again quite 25:34 25 minutes, 34 seconds optimistic uh on on this so I think moving forward uh hopefully we will see 25:41 25 minutes, 41 seconds uh this supporting the export journey yes this is good good to hear sir uh sir 25:48 25 minutes, 48 seconds secondly any kind of cost we have incurred for the sk entity in quarter 3 25:57 25 minutes, 57 seconds uh we we are concluding the uh CPS and uh uh we have formed the company. So we 26:05 26 minutes, 5 seconds are expecting to contribute equity uh during this uh quarter and uh we expect the start of operations from uh quarter 26:14 26 minutes, 14 seconds 1 of SY 27. A small operation to begin with. There are uh cost related to 26:21 26 minutes, 21 seconds forming a company and uh initial expenditure are being incurred but we do not see any substantial expenditure. 26:31 26 minutes, 31 seconds Okay. Noted. And sir, just on the uh on the basic question on the Sunru Q3 numbers, if you can share the revenue of beta, please. 26:41 26 minutes, 41 seconds Q3. Uh I just shared number one. 26:50 26 minutes, 50 seconds Yeah. So the revenue in the quarter 3 was 107 cr with an AITA margin of 13.5. 26:57 26 minutes, 57 seconds I shared this uh during the opening remarks. 27:01 27 minutes, 1 second Okay. And in Q2 basically the margins were higher right on on the sunroof. 27:06 27 minutes, 6 seconds Yes. So that is what I think a couple of times I mentioned when Adita and Mumuk asked this question. I think we have had 27:13 27 minutes, 13 seconds some additional expenses uh on on account of uh I think more technology support and localization support for 27:21 27 minutes, 21 seconds some new business. So uh I just shared that. So no thing no 27:28 27 minutes, 28 seconds lastly just uh last one question these three new variants ofai which we have received for the sun group so are they able to offset the crater business which 27:37 27 minutes, 37 seconds we which we are you know going to exit from fi 28 comfortably because I think I've been clarifying this uh quite frequently 27:46 27 minutes, 46 seconds because there are uh uh two models and three variants already under development uh u these business wins have been 27:54 27 minutes, 54 seconds shared with you earlier Okay. Uh and I think what we are looking at with this business win is to build on that. So we 28:01 28 minutes, 1 second are not uh we are not uh looking at this compensating. We are looking at this 28:07 28 minutes, 7 seconds building on uh on the further growth of all right sir. Good to hear. All the best sir. Thank you so much. 28:16 28 minutes, 16 seconds Thank you. Thank you so much. Thank you. 28:21 28 minutes, 21 seconds The next question is from the line of runway from asset ca investment intermediate. Please go ahead. Uh hi 28:29 28 minutes, 29 seconds sir, thank you for the opportunity. Am I audible? Yes, very clear. Go ahead please. 28:34 28 minutes, 34 seconds Great. Okay. Uh so a couple of questions on the sum side. Uh firstly the new Yundai models that we have uh received. 28:42 28 minutes, 42 seconds Are these existing models or new models that the company would be launching? 28:49 28 minutes, 49 seconds Uh There are model codes that are available generally because the model names are 28:57 28 minutes, 57 seconds normally not uh uh sort of announced before earlier. Uh they uh they are a 29:04 29 minutes, 4 seconds combination of new as well as refreshed as per my understanding. Okay. 29:11 29 minutes, 11 seconds The developments will be new in any case. 29:14 29 minutes, 14 seconds Right. Okay. Um and sir one thing with regards to the realizations of the uh like per unit realization of Sanru has 29:23 29 minutes, 23 seconds that seen some kind of pressure since the time that we have started since we are seeing more players also entering the segment 29:31 29 minutes, 31 seconds that is very uh normal and very natural for any product because uh when when there is an increased competition 29:39 29 minutes, 39 seconds uh the the pressure both on uh on the margins as well as on more localization requirements etc 29:48 29 minutes, 48 seconds keep increasing. Uh so definitely the answer I will not say the answer is no. 29:52 29 minutes, 52 seconds The answer is yes. Uh we need to as I mentioned earlier we uh we also need to like any other organization. We also 30:00 30 minutes need to find uh ways and means and different avenues to keep maintaining a healthy profitability. 30:08 30 minutes, 8 seconds uh and that is how we are looking at uh more support uh from the NAFA global team on localization and fast 30:15 30 minutes, 15 seconds localization uh there so to ensure that the uh the pressure on the margin will be reduced 30:23 30 minutes, 23 seconds but yes with multiple player coming it is very natural to have more uh competition. 30:29 30 minutes, 29 seconds Okay. Okay. And so on the standalone financials there's a very high other income in this quarter any one of them. 30:37 30 minutes, 37 seconds So uh I think the other income is the you want to Yeah. So other income includes this time a dividend receipt uh from the subsidiary uh in alpha. 30:50 30 minutes, 50 seconds Okay. Okay. And uh so just one last question if you can indicate uh the revenue of MMA in the quarter. 31:01 31 minutes, 1 second Normally plant-wise breakup we uh we don't share because it is one of the plants. So normally we don't share the plant wise break. 31:11 31 minutes, 11 seconds Okay. Got it. Thank you. Thank you. 31:14 31 minutes, 14 seconds It's doing little better than what it was doing. Can I can only share. Okay. 31:24 31 minutes, 24 seconds Thank you. 31:26 31 minutes, 26 seconds The next question is from the line of punit zeri from zeri and company. Please go ahead. Uh yes uh thank you for the opportunity. 31:35 31 minutes, 35 seconds Uh you mentioned about the line to uh utilization plan to go to 60 or 70%. Uh are you at the liberty to share what is where is it right now? 31:46 31 minutes, 46 seconds So the second line is not utilized at all. Currently we are utilizing only one line. 31:52 31 minutes, 52 seconds Okay. And in terms of your sun roots also you you mentioned that you want to increase the utilization uh localization 31:59 31 minutes, 59 seconds effect. So is there any way that that you can qualify? How much is it already done and what is the expectation in 32:08 32 minutes, 8 seconds terms of increasing localization if not percentage any quality highlight? 32:13 32 minutes, 13 seconds Yeah. So current status of the localization is around uh 33%. 32:18 32 minutes, 18 seconds uh it used to be around 26% I think when we first started if I'm not wrong and we are the target is to take it to uh 60%. 32:30 32 minutes, 30 seconds And uh is the target for 60% is it till 2030 or any is it next couple of years or something something 32:38 32 minutes, 38 seconds within within uh the next uh one one and a half years I think we we are now working I think uh while 32:46 32 minutes, 46 seconds we are having this call there are already workshops going on uh the entire global team is here and we are looking at uh expediting this process. So by uh 32:56 32 minutes, 56 seconds by end of 26 uh 26 27 we intend to do that and for obviously for the the new 33:04 33 minutes, 4 seconds developments the localization will be much faster. Uh for the existing ones uh you have to go through lot of validation etc. So that is generally a slower 33:12 33 minutes, 12 seconds process but when we are we intend to launch with much higher localization. 33:19 33 minutes, 19 seconds because and in terms of uh realization for Sunro I think you you mentioned that the competition has increased and it's a 33:26 33 minutes, 26 seconds natural state of the how the business is uh so is it fair to assume that the realization has dipped a little bit 33:33 33 minutes, 33 seconds compared to say a year ago and that is expected to increase once your localization increases as well so is there anything how should we look at this look at this 33:41 33 minutes, 41 seconds uh obviously for the there are two aspects to it one is the existing business uh uh it is not a product which anybody comes and to develop it 33:50 33 minutes, 50 seconds tomorrow. So it doesn't impact the existing product. Obviously the model mix there something may have a higher profitability something may have a lower 33:58 33 minutes, 58 seconds profitability because every model doesn't have so model mix can play a role uh on the the I think the discussion point was more on the new uh 34:07 34 minutes, 7 seconds new RFQS and new discussions uh uh with multiple customers. So there uh if the RFQ goes to three players then obviously 34:15 34 minutes, 15 seconds you compete in an environment. So there extra localization etc would help but nothing on the running business 34:24 34 minutes, 24 seconds and just one final question because uh you do provide u you know a really honest assessment of things on on your 34:30 34 minutes, 30 seconds FDA both US and Europe uh is it that the the existing competitors who already have plants there uh you'll be able to 34:40 34 minutes, 40 seconds better compete with them and hence you feel that it's just that the road is just upwards from where you are right now. Is it that your existing products 34:48 34 minutes, 48 seconds can have and find a market there? Uh much quicker now basis of cost amongst other key factors. 34:57 34 minutes, 57 seconds Uh sorry I I've not been able to hear you well. Uh maybe un if you can 35:04 35 minutes, 4 seconds uh you can repeat some part of it. I I think I was not able to. Am I audible now sir? 35:11 35 minutes, 11 seconds Yeah you're audible. Maybe a little shorter question may be helpful. Huh. 35:18 35 minutes, 18 seconds So I was just asking on FDA if you can provide some uh feedback if how will you better compete with the existing players 35:27 35 minutes, 27 seconds both Indian and local who already have their plans there. Is it largely just cost or is there any other factors that you're considering? 35:35 35 minutes, 35 seconds So one thing is uh all the competition that we are talking about are in the process of coming in. It is not uh 35:43 35 minutes, 43 seconds before uh currently uh before IGSS there was one competitor who had a who had a full-fledged facility here uh in India. 35:52 35 minutes, 52 seconds All the others are coming in with different joint ventures, different configuration. I think none of them have been able to as of now win a win a 36:01 36 minutes, 1 second business. uh moving forward uh the competition would not only be on uh uh I 36:08 36 minutes, 8 seconds would say on uh price I think it technology will also play a role there definitely I think in alpha being very 36:16 36 minutes, 16 seconds strong in technology we are also trying to offer some new newer technology products to customers so it will be a I 36:24 36 minutes, 24 seconds think moving forward not in the immediate run but long term it will be a combination of standard products and a new technology products where obviously 36:33 36 minutes, 33 seconds margins profile would be would be different uh in both the idea is to bring more technology. 36:41 36 minutes, 41 seconds Of course, thanks so much for the opportunity and wish you the best. Thank you. Thank you. 36:51 36 minutes, 51 seconds The next question is from the line of Ana Kana from Alpha Alternatives. Please go ahead. 37:00 37 minutes Um hi. Uh so my question is uh when can we expect the statuto approvals to start rolling in for the uh scheme of arrangement? 37:10 37 minutes, 10 seconds So uh on the scheme of arrangement we uh we received the NOC from uh stock exchange and uh post that we filed our 37:19 37 minutes, 19 seconds application to NCT. Uh I'm happy to share that fast motion hearing happened in early January and uh the scheme has 37:29 37 minutes, 29 seconds been submitted and the order has been announced uh by the end of uh January. 37:36 37 minutes, 36 seconds Now the soft copy of the order is available on the NCT website. We expect uh a certified copy to be received uh in 37:45 37 minutes, 45 seconds this week and we will follow the due course of action uh coming from that order. So we are very much on track what 37:52 37 minutes, 52 seconds original time plan we had planned for this scheme and uh we have we've been progressing very well on this one. 38:01 38 minutes, 1 second All right sir thank you. Thank you. 38:06 38 minutes, 6 seconds Thank you. The next question is from the line of Abdu Jooshi from three vantage capital. Please go ahead. 38:15 38 minutes, 15 seconds Uh hi uh thanks for the opportunity. 38:19 38 minutes, 19 seconds uh considering the inroad we have made into hero uh do we uh of course we will see rise 38:26 38 minutes, 26 seconds into the volumes I just wanted to know about the capacity our capacity do we intend to add add capacity in line to 38:35 38 minutes, 35 seconds that and what's our current utilization uh see in the two wheeler uh uh I think 38:43 38 minutes, 43 seconds if you if you look at the market growth in the last uh few years if you look at the Gabriel growth. Uh uh we are 38:51 38 minutes, 51 seconds continuously uh adding uh capacities. Uh so obviously with uh new businesses 38:59 38 minutes, 59 seconds coming in not only from Hero but from all the other customers also I think the share of business has been continuously improving. uh in line with that we have 39:08 39 minutes, 8 seconds been adding capacities in the existing plants also and we are looking forward to maybe adding a location uh 39:15 39 minutes, 15 seconds specifically in the in the coming sometime. So uh capacity enhancement in two wheeler is to be honest is a 39:23 39 minutes, 23 seconds continuous affair. Uh even today also we have cleared two more lines uh uh in our board meeting uh there. So we we continue to invest. 39:35 39 minutes, 35 seconds Okay. So currently we are operating at around 70% capacity. 39:40 39 minutes, 40 seconds Yeah. So normally uh the way you know the two wheeler works is there is a there's a normal demand and then there is a festival 39:48 39 minutes, 48 seconds season demand. So we try to operate at around 70% during these time so that we have some idle capacity to meet the uh 39:57 39 minutes, 57 seconds festival season demands. So the utilization is in line with that. 40:03 40 minutes, 3 seconds Understood. So there is more change into the or larger capex expected into the next year. Is that correct understanding? 40:10 40 minutes, 10 seconds Yes. Yes. We we are looking we are anticipating that uh for the next year. Yes. 40:17 40 minutes, 17 seconds Unders. That's it from Thank you. Thank you. 40:25 40 minutes, 25 seconds The next question is from the line of from Anandrai Institution Equities. Please go ahead. 40:33 40 minutes, 33 seconds Yeah, thank you sir for the opportunity again. Sir Mind is available. Uh just wanted to hear his thoughts sir. Uh how 40:41 40 minutes, 41 seconds is in the progress on the your 30 ambitious brand plan? just want to understand how are you seeing the M&A opportunities what kind of areas where 40:50 40 minutes, 50 seconds uh GP Anam group can expand and secondly uh with the four uh companies completion happening uh very 40:59 40 minutes, 59 seconds soon um how do you see the further uh group such happening let's say next year next year 41:06 41 minutes, 6 seconds okay uh thank thanks uh maybe uh Mr. Go is there so you you would like to address this sir? 41:18 41 minutes, 18 seconds Sorry to interrupt sir. The line for Mr. Goer has been disconnected. 41:23 41 minutes, 23 seconds Okay. Okay. Uh so maybe I'll I'll take uh this. 41:26 41 minutes, 26 seconds Yes, please. Yes. Uh so uh yes uh uh uh the uh as far as the bigger target for 41:34 41 minutes, 34 seconds the group is concerned uh multiple opportunities are uh being evaluated uh in line with uh uh the 41:44 41 minutes, 44 seconds expectations uh there uh as and when think something materializes 41:51 41 minutes, 51 seconds uh we will definitely come back to uh and uh share uh the updates on that uh but uh yeah there is a just to share 42:00 42 minutes with you there is a uh there's a proper uh review mechanism for that there is a proper proper uh monitoring for that uh 42:09 42 minutes, 9 seconds in terms of uh the progress in terms of what are the opportunities that are being evaluated both on the organic as 42:17 42 minutes, 17 seconds well as on the inorganic side. So uh I think hopefully we should be able to uh share some updates in the in the coming 42:26 42 minutes, 26 seconds uh time. Uh what was the second question? Sorry. 42:30 42 minutes, 30 seconds Uh so so with the yeah four companies uh uh consideration happening now very soon now how do you see the plans ahead for 42:38 42 minutes, 38 seconds the further growth group? So uh I think as we have discussed multiple times so 42:44 42 minutes, 44 seconds uh uh we are completely on track on this uh uh hopefully I think uh as of today we are completely meeting the timeline. 42:53 42 minutes, 53 seconds We would go we would like to go through this process and uh then surely come back uh uh to all of you on the next update. Okay. 43:04 43 minutes, 4 seconds Yeah. Thank you so much for the opportunity and all the best of the best. Thank you. Thank you very much. Thank you. 43:12 43 minutes, 12 seconds The next question is from the line of Virat from SIMPL. Please go ahead. 43:17 43 minutes, 17 seconds Uh yes, thanks for the opportunity. Am I audible? Yes. Yes. Yes. 43:23 43 minutes, 23 seconds Uh uh so just two questions. uh on the standalone uh see uh the mother uh sorry the Marini 43:32 43 minutes, 32 seconds acquisition uh we started consolidating from Q1 and if the Android in Q3 is 43:38 43 minutes, 38 seconds better than Q two then we would basically be seeing a flat growth for us 43:46 43 minutes, 46 seconds in two wheeler segment in this which is uh so I understand has grown better and 43:54 43 minutes, 54 seconds more But the deviation is still quite large. 44:00 44 minutes Uh so var I I don't know if you were there because I think couple of times I have tried to answer this question. Uh 44:08 44 minutes, 8 seconds again this see you also understand that is sometimes it can be a model mix issue. I just mentioned that I think there's there's no business uh impact 44:17 44 minutes, 17 seconds that is there uh because the production uh uh numbers the while the sales number 44:24 44 minutes, 24 seconds are more uh but the production growth is 16% against that we are looking at a 13% uh number uh one impact is coming from 44:32 44 minutes, 32 seconds hero second maybe because of the model mix uh part that is there rather I shared that I think we have further uh 44:40 44 minutes, 40 seconds very strong winds in the two wheeler side on the inverted front folks and on the normal front folks and they have a very healthy pipeline there. So I'm I'm 44:49 44 minutes, 49 seconds not seeing a flinch on on this front at all. 44:53 44 minutes, 53 seconds Okay. Just a clarification uh when you say uh barely acquisition uh will the concentration be largely two-heer or it's again spread out between two 45:01 45 minutes, 1 second wheelers four-wheelers and is mostly combination of I would say maybe 70 80% would be passenger car and 45:11 45 minutes, 11 seconds then balance would be commercial vehicle there's no two wheel so that is the reason you would see a 63 64% normal 45:18 45 minutes, 18 seconds coming down uh with some businesses getting increased there or some volume changes is happening there. So the 45:25 45 minutes, 25 seconds overall this over would come down that is on account of increase in the other segment and not uh because of any loss in the share. 45:34 45 minutes, 34 seconds Understood. 45:39 45 minutes, 39 seconds uh uh any color you can give in terms of revised terms in terms of tech license fee service fee you know how would that 45:48 45 minutes, 48 seconds now be and uh the question is also you know since we have the second line now commission is there opportunity for 45:56 45 minutes, 56 seconds exports to make up the shortfall so uh I don't know if you were there vir I think we discussed that uh and we 46:04 46 minutes, 4 seconds shared that there is there is a good business win for three variants of TVS type of sunroof uh where we would be now 46:14 46 minutes, 14 seconds getting into a very healthy utilization once the SOP happens on the second line. 46:19 46 minutes, 19 seconds Also uh as far as the export is concerned, one of the variants that we had uh uh I think uh if you remember I 46:27 46 minutes, 27 seconds had shared earlier that there are uh two models and three variants under development. Uh one of the model uh is 46:34 46 minutes, 34 seconds also for export. This is called as a BC40. Uh so but this is not a product one this entity obviously is is set up to uh service the local customers. 46:46 46 minutes, 46 seconds Second uh the uh this is not a product which is so easy to transport and handle. So uh any opportunity that keeps 46:55 46 minutes, 55 seconds coming in on export we'll be very happy to uh sort of engage on this but uh primary we are looking at uh increasing 47:03 47 minutes, 3 seconds the domestic uh share of business and on tech uh what is the new arrangement now 47:11 47 minutes, 11 seconds uh in yes there is an in uh uh I think I had explained uh on the increased cost 47:18 47 minutes, 18 seconds because of the two reasons but yes in terms of the new uh arrangement we uh I think the the royalty uh numbers have 47:27 47 minutes, 27 seconds changed and we have seen an increase of around 1.9% there. 47:32 47 minutes, 32 seconds So this will be a permanent cover. Uh yes, this will be permanent as of now because we Okay, got it. Okay, got it. A 47:40 47 minutes, 40 seconds lot of other activities and technical support is needed to expedite the new business winds and localization 47:47 47 minutes, 47 seconds activities here. So additional resources are being needed. Got it. Got it. That's your comment. Thank you and good luck, sir. 47:55 47 minutes, 55 seconds Thank you. Thank you. 47:58 47 minutes, 58 seconds The next question is from the line of Amit Hanandani from Philip Capital. 48:03 48 minutes, 3 seconds Please go ahead. Yes sir. Thanks for the opportunity again. Sir strategic question wanted to understand how do you 48:09 48 minutes, 9 seconds see this semi-active shocks industry in the next 5 years and Gabriel's readiness for this product. Also if you can touch 48:18 48 minutes, 18 seconds base whether you know this Marili Italy's open tech partnership and the KYB uh tech agreement we have how best 48:26 48 minutes, 26 seconds they can support in faster development for this product. 48:30 48 minutes, 30 seconds So uh just one minute okay see uh on the uh first I'll answer on 48:38 48 minutes, 38 seconds the semi-active part. The semi-active uh product is completely ready uh with us now. uh we just I think uh in last 2 48:48 48 minutes, 48 seconds three months we have done a complete tuning on two vehicles. Now the two PC's have been done on different uh uh 48:55 48 minutes, 55 seconds different customer vehicles uh one independently and one with uh potential customer uh and the product is 49:03 49 minutes, 3 seconds completely uh ready as far as the technology proving uh is is concerned. 49:08 49 minutes, 8 seconds Obviously uh it all depends upon the new opportunity that comes to uh bring it to the mass market but yes we are ready uh 49:17 49 minutes, 17 seconds so we we are not looking uh uh at any support coming in from outside for this because we as you know we have invested 49:24 49 minutes, 24 seconds quite a bit in in the European tech center and we have enough expertise available there. uh as far as uh the 49:31 49 minutes, 31 seconds agreement with KYB etc is concerned I think that is all working fine on the existing businesses depending upon the customer requirements and the kind of 49:39 49 minutes, 39 seconds wall wings and the kind of technology that is needed. So it is always a combination of uh what uh if if it is a 49:48 49 minutes, 48 seconds standard platform uh coming in from some global uh uh or being developed in India. So it is there's is a combination 49:56 49 minutes, 56 seconds both with the local developed technology and uh one of the partners but for the specifically on the electronic 50:04 50 minutes, 4 seconds suspension we uh we are not looking at uh any support uh that you needed as of now. 50:13 50 minutes, 13 seconds Yeah. But do you see this industry evolving you know five years? 50:17 50 minutes, 17 seconds The industry will evolve. One one variant has come into the market. uh as I said I think we have been working with 50:24 50 minutes, 24 seconds one customer as a proof of concept to demonstrate uh the technology uh the 50:31 50 minutes, 31 seconds penetration will be will be slow uh obviously the cost impact is also significant uh even today also whatever 50:39 50 minutes, 39 seconds is being made is not made in made locally they're all imported uh so uh you need an ecosystem 50:48 50 minutes, 48 seconds uh on the on the electronics on the uh assembly on the dampers etc. So uh it 50:55 50 minutes, 55 seconds will be uh it will be a slow progress uh there on the passenger car side while it one or variants will keep coming. I 51:04 51 minutes, 4 seconds think maybe when you as you ask 5 years down the line my estimate is that maybe top end variants uh of some models may 51:12 51 minutes, 12 seconds have this uh I'm looking at uh some opportunity coming in in the two wheelers much faster. Uh because there 51:19 51 minutes, 19 seconds are couple of customers the P has already happened. We have already done that. Uh that may happen much faster than the passenger car but we'll have to wait and watch. 51:31 51 minutes, 31 seconds But Marion may not may not happen looking at the cost pressure normally on the vehicles. 51:39 51 minutes, 39 seconds So I think then frequency selected damping would be the best looking at the Indian condition and the cost angle right. So it will be uh obviously 51:48 51 minutes, 48 seconds different kind of walls. Uh the passive walls would be would keep improving. 51:52 51 minutes, 52 seconds That is number one. Number two FSD or HRS or double FSD kind of can be an interim solution to this where we see 52:01 52 minutes, 1 second more uh traction uh currently and then maybe at some stage semi-active but I don't see it happening in the immediate uh term on this. 52:13 52 minutes, 13 seconds Okay. All right sir. Thank you so much. 52:15 52 minutes, 15 seconds Thank you. Thank you. Thank you very much. Thank you so much. 52:18 52 minutes, 18 seconds Thank you ladies and gentlemen. That was the last question for today. I would now like to 52:26 52 minutes, 26 seconds hand over the conference to Mr. Atul Jaki for closing comments. Over to you sir. 52:31 52 minutes, 31 seconds Yeah thank you. Uh so uh I take this opportunity to thank everyone for joining on the call. I hope we have been able to address all your queries. For 52:40 52 minutes, 40 seconds any further information kindly get in touch with any of us or SGA our investor relation advisor. Thank you so much. 52:52 52 minutes, 52 seconds Thank you on behalf of Gabriel India Limited. That concludes this conference. 52:57 52 minutes, 57 seconds Thank you for joining us and you may now disconnect your lines. Thank you.