Godavari Biorefineries Limited — Q4 FY26

Godavari Biorefineries Ltd Q4 FY2025-26 Earnings Conference Call https://www.youtube.com/watch?v=uXHcULPSnOw Published: 3 weeks ago

0:01 1 second Ladies and gentlemen, good day and welcome to Gdavari's Biorefrinaries Limited Q4 FI26 earnings conference 0:09 9 seconds call. As a reminder, all participant lines will be in the listen only mode and there will be an opportunity for you to ask questions after the presentation 0:17 17 seconds concludes. Should you need assistance during the conference call, please signal an operator by pressing star then zero on your touchdown phone. Please note this conference is being recorded. 0:29 29 seconds I now hand the conference over to Miss Prai Amre from MUFG in time. Thank you and over to you ma'am. 0:36 36 seconds Thank you Steve. Good morning everyone and welcome to Bodhavari Biorefineries Limited Q4 and FI26 earnings conference call. Today on the call we have Mr. 0:46 46 seconds Samir Somaya chairman and managing director. Mr. Ashi Shina assistant general manager investor relations and 0:53 53 seconds finance to provide insights on the operational and financial performance. 0:58 58 seconds Before we begin the call, I would like to give a short disclaimer. This call may contain some of the forward-looking statements which are completely based 1:06 1 minute, 6 seconds upon our beliefs and expectations as of today. The statements are not a guarantee of our future performance and involve unforeseen risks and 1:13 1 minute, 13 seconds uncertainties. With this, I would like to hand over the call to Sam sir for his opening remarks. Over to you, sir. Thank you. 1:23 1 minute, 23 seconds Good morning everyone. Thank you for joining us today for the Q4 and FY26 earnings call of God by Refineries Limited. 1:32 1 minute, 32 seconds We appreciate your continued trust, engagement and interest in our company. 1:37 1 minute, 37 seconds At Gabrifin, we have always believed that business must create value. Guided by our purpose of creating a beautiful world, we remain committed to building a 1:46 1 minute, 46 seconds cleaner, more sustainable and self-reliant future. 1:50 1 minute, 50 seconds At the outset, let me briefly set the broader global context. Ongoing geopolitical developments, particularly in West Asia, have led to increased 1:59 1 minute, 59 seconds volatility in fossil fuel supply chains, energy markets, and global trade flows. 2:05 2 minutes, 5 seconds This current reality demonstrates what a fossil starved world would look like in in the future and therefore even furthers a resolve of creating a 2:13 2 minutes, 13 seconds biio-based beautiful world. This uncertainty is accelerating a structural shift towards sustainable and biio-based alternatives as industries increasingly 2:22 2 minutes, 22 seconds prioritize re reliability, resilience and environmental responsibility. 2:28 2 minutes, 28 seconds In parallel, the transition towards renewable and biiobased chemicals continues to gain momentum. Rising fuel costs and steps to increase ethanol 2:36 2 minutes, 36 seconds blending targets re reinforce our belief that renewable solutions are no longer optional but essential. This strengthens our 2:45 2 minutes, 45 seconds long-term vision of transitioning from oil to soil and positions us well as an integrated biorefinery. 2:52 2 minutes, 52 seconds The regulatory environment also remains supportive. The government of India continues to push the ethanol blending program 3:02 3 minutes, 2 seconds and has issued draft standards for blending beyond E20 creating a stronger demand outlook. In line with this, we 3:11 3 minutes, 11 seconds are progressing well on our 200 KPD grainbased distillery expected to commission by June 26, adding 3:19 3 minutes, 19 seconds approximately 60 million L of annual ethanol capacity. The FY26 has been a year of steady progress and resilience 3:26 3 minutes, 26 seconds for Gulabi bio refineries. In spite of the challenging external environment, we have delivered a turnaround in profitability, strengthened our balance 3:34 3 minutes, 34 seconds sheet and continued to advance our strategic priority. 3:37 3 minutes, 37 seconds Against this backdrop, we delivered a resilient performance during the quarter and the full year. For the full year, total income stood at 2,000 crores, up 3:46 3 minutes, 46 seconds 6% year-on-year, while EPIDA grew 15.8% to 139 crores with margins stabilizing 3:52 3 minutes, 52 seconds at 7%. Importantly, we reported a positive profit after tax of 3.5 crores compared to a loss in FI25 despite 4:01 4 minutes, 1 second certain exceptional factors during the year. In Q4, revenue from operations stood at 564 4:09 4 minutes, 9 seconds crores with an EBIT of 92 crores and a margin of 16%. Reflecting a strong sequential recovery supported by improved sugar operations during the 4:18 4 minutes, 18 seconds peak crushing season. The performance was supported by disciplined execution, improved efficiencies and continued focus on strengthening her balance sheet 4:26 4 minutes, 26 seconds reflecting in a 32% reduction in finance costs to 49 crores following depth repayment of 240 crores in FY25. 4:35 4 minutes, 35 seconds Operationally, Q4 reflected strong execution. During the 2526 crushing season, we achieved our highest ever 4:42 4 minutes, 42 seconds cane crushing of 2.5 million tons. Our integrated Pagasbas based energy platform continues to provide us with 4:50 4 minutes, 50 seconds cost and sustainability advantage, enhancing efficiency and stability across operations. The sugar business 4:58 4 minutes, 58 seconds benefited from higher volumes, improved recoveries and strong export execution supporting performance despite a challenging margin environment. 5:07 5 minutes, 7 seconds Our biiobased chemical segment continues to progress in line with our strategy of increasing specialtity product shares 5:15 5 minutes, 15 seconds for FI26. Segment revenue stood at 578 crores supported by improved contribution from specialtity chemicals. 5:23 5 minutes, 23 seconds While geopolitical disruptions impacted sales, our competitiveness continues to improve through debottlenecking, process optimization, and innovation-led 5:32 5 minutes, 32 seconds development, including the successful enhancement of our ethile acid operations. 5:37 5 minutes, 37 seconds In the ethanol business, we delivered steady growth despite pricing pressures. 5:42 5 minutes, 42 seconds Revenue for FI26 stood at 658 crores, supported by improved feed stock availability, particularly B heavy 5:50 5 minutes, 50 seconds molasses. During the year we have sold approximately 98 million liters of ethanol equivalent across the ethanol blending program ENA and other grades. 5:59 5 minutes, 59 seconds Our multif feed stock and multi-product approach remains key to enhancing flexibility and reducing risk. Our 6:06 6 minutes, 6 seconds consumer business Gina continues to gain strong traction and is emerging as an important growth driver. Revenue for 6:14 6 minutes, 14 seconds FI26 stood at 129 crores with a strong growth story and expanding retail presence across South across South India 6:23 6 minutes, 23 seconds reflecting increasing consumer preference for natural and sustainable products. From a strategic standpoint, our priorities remain clear. We are 6:32 6 minutes, 32 seconds focused on expanding specialtity chemicals to improve margins, strengthening our ethanol platform and scaling our consumer business to build a 6:40 6 minutes, 40 seconds more diversified and resilient model while continuing to invest in R&D technology and sustainability. We are 6:47 6 minutes, 47 seconds also strengthening our innovation capabilities including expanding our global research footprint to support future ready solutions. Everything we do 6:56 6 minutes, 56 seconds begins with the sun, the soil and the small farm. Through our regenerative agriculture initiatives, we are restoring soil health and improving farm 7:03 7 minutes, 3 seconds resilience and empowering farmers across our network while reducing reliance on fossil based inputs. At the same time, 7:11 7 minutes, 11 seconds we continue to build capabilities and high value innovation, including advancing our oral therapy candidate for triple negative breast cancer and 7:19 7 minutes, 19 seconds strengthening our antiviral platform with a recently secured Japanese patient. These efforts reflect [clears throat] our commitment 7:27 7 minutes, 27 seconds to combining sustainability with science-led innovation. Looking ahead, we are excited about emerging 7:35 7 minutes, 35 seconds tech opportunities in areas such as biutinol, DME, and next generation renewable technologies which align with 7:43 7 minutes, 43 seconds our long-term vision of building a sustainable and innovation business. We are proud of the recognitions received during the year including the Karnataka 7:52 7 minutes, 52 seconds state boiler safety award for a Samiri plant, the sustainability champion award at the AIDA annual distillers conclave 7:59 7 minutes, 59 seconds 2026 and recognition at the Hanover Messa for our digital initiatives. 8:05 8 minutes, 5 seconds In addition, our participation in platforms such as ChemX for India and in cosmetics global has strengthened our positioning as a reliable supplier of 8:14 8 minutes, 14 seconds sustainable chemical solutions. In conclusion, FYI26 has been a year of resilience, recovery, and strategic progress. We have strengthened our 8:22 8 minutes, 22 seconds fundamentals, improved profitability, and built a stronger platform for future growth. We remain committed to creating long-term value for all stakeholders, 8:30 8 minutes, 30 seconds guided by a belief that growth must be sustainable, responsible, and inclusive. 8:35 8 minutes, 35 seconds With that, I would like to now hand over the call to Mr. Ashish Shha, who will take you through the financial performance in greater detail. 8:43 8 minutes, 43 seconds Good morning, everyone. Uh let me take you through the key financial highlights focusing on our operational efficiency for the FI26. 8:53 8 minutes, 53 seconds [clears throat] The total income stood at 2.2 cr reflecting a growth of 6% y from 1,886.9. 9:03 9 minutes, 3 seconds Inda expanded significantly by 15.8% 8% to rupees 139.3 cr compared to rups 9:12 9 minutes, 12 seconds 120.3 cr last year showing strong operational leverage over the 12 month period. 9:19 9 minutes, 19 seconds Aita margin for the year stabilizing at around 7%. 9:24 9 minutes, 24 seconds While margins remained under pressure during parts of the year due to elevated feed stock cost. The second half saw 9:32 9 minutes, 32 seconds gradual improvement driven by operational efficiency and better product mix. 9:37 9 minutes, 37 seconds From a segmental perspective during the year, the integrated sugar, ethanol and co-generation business together reported 9:45 9 minutes, 45 seconds revenues of approximately 1,383 cr and evita at 97.4 cr increased by 19% yon. 9:56 9 minutes, 56 seconds The biotech chemical segment performance improved with an increasing percentage of specialty chemicals to 61% compared 10:04 10 minutes, 4 seconds to 58% by a wide against total revenue from biio-based chemicals. 10:10 10 minutes, 10 seconds There has been a significant improvement in our capital structure. Finance cost reduced to 49.1 K down approximately 32% 10:19 10 minutes, 19 seconds value supported by debt repayment of rupees 240 kores during the year FI25. 10:27 10 minutes, 27 seconds As a result, finance cost as a percentage of revenue declined meaningfully improving overall profitability and strengthening our 10:35 10 minutes, 35 seconds balance sheet. We reported a profit after tax of rupees 3.5 cr compared to a loss in FI25. 10:43 10 minutes, 43 seconds Quarter 4 FY26 reflected a strong recovery in operational performance. Revenue from 10:50 10 minutes, 50 seconds operation for the quarter stood at rupees 564 K and a bit at rupees 92 crores translating into a beta margin of 16.2%. 11:01 11 minutes, 1 second From a segmental perspective, the integrated sugar ethanol and co-generation business together reported revenues of approximately 411 kores 11:10 11 minutes, 10 seconds during the quarter with meaningful improvement in margins driven by higher crushing volumes and better recovery rates. The biiobased chemical segment 11:20 11 minutes, 20 seconds reported revenues of around 147 cr on a quarteron quarter performance improved 11:27 11 minutes, 27 seconds significantly a beta more than a double compared to quarter 3 fi 26 with margin expanding from 9.8% to 16.2%. 11:38 11 minutes, 38 seconds This improvement was prim primarily driven by better absorption of fix cost, higher operating efficiency in sugar 11:44 11 minutes, 44 seconds segment and improved realizations across key product categories during the quarter. Profit after tax for the 11:51 11 minutes, 51 seconds quarter stood at rupees 52.9 K reflecting a strong recovery from rupees 8.3 K reported in quarter three of 26. 12:01 12 minutes, 1 second This improvement was largely driven by operating performance indicating a healthy underlying business momentum. 12:08 12 minutes, 8 seconds Overall, both the quarter and the full year reflect improving official momentum, strong cost discipline and 12:15 12 minutes, 15 seconds better capital efficiency. This provides a solid competition as we enter FI27 with improved balance sheet strength and 12:23 12 minutes, 23 seconds operating leverage. Thank you. We can now open the floor for questions. 12:30 12 minutes, 30 seconds Thank you. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on their touchstone telephone. 12:42 12 minutes, 42 seconds If you wish to withdraw yourself from the question queue, you may press star and two. Participants are requested to use handset while asking a question. 12:51 12 minutes, 51 seconds Ladies and gentlemen, we will wait for a moment while the question queue assembles. 13:07 13 minutes, 7 seconds The first question comes on the line of Somia Raguanchi with Merva Capital. Please go ahead. 13:22 13 minutes, 22 seconds Somia, your line has been unmuted. Please go ahead with your question. 13:38 13 minutes, 38 seconds As there is no response, we'll move on to the next question. It's on the line of Nille Kulkarnney with Vad AI. Please go ahead. 13:48 13 minutes, 48 seconds Hello. Um u congrats on the record-breaking sugar dressing season and um you know I've 13:56 13 minutes, 56 seconds been going through some uh the the reports one thing that uh struck me is in the biiobased segment the 14:04 14 minutes, 4 seconds contribution of specialty chemists uh seems to have shrunk actually from 14:11 14 minutes, 11 seconds I think 40 oh yeah we can hear you. 14:22 14 minutes, 22 seconds Oh no, we can hear you. N Hello. 14:31 14 minutes, 31 seconds N we can hear you. 14:32 14 minutes, 32 seconds Yeah. Okay. So sorry. Um could I get some understanding on the path to you know specialty chemicals in general? I'm 14:41 14 minutes, 41 seconds really excited about how we are moving away from uh reliance on ethanol etc. Um so so that's one and you know if we 14:49 14 minutes, 49 seconds could get some updates on the uh distillery as well that would be great. Thank you. 14:55 14 minutes, 55 seconds So thank you for the question. Let me give you a context of what is happening currently in the world of biiobased chemicals. 15:04 15 minutes, 4 seconds The West Asia crisis suddenly transports us into the future when we see a world 15:11 15 minutes, 11 seconds in which fossil resources are scarce and that environment is currently real for 15:18 15 minutes, 18 seconds us. So that is now resulting in two or three aspects. One is the government of 15:25 15 minutes, 25 seconds India is looking at further means of bending us to be a greater self-reliance 15:32 15 minutes, 32 seconds in energy. That is at one point and the second is how customers are looking for 15:39 15 minutes, 39 seconds reliability in their supply chains. I'll go one step further. We are also finding that imports into India are becoming 15:48 15 minutes, 48 seconds more expensive and also if you look at export markets energy costs have increased globally everywhere. 15:57 15 minutes, 57 seconds Now what is happening in our model our energy is about 85% from bgas as a fuel 16:04 16 minutes, 4 seconds and about 15% from coal. These costs of energy have more or less remained 16:10 16 minutes, 10 seconds stable. Ethanol itself also is the main raw material, primary raw material for 16:17 16 minutes, 17 seconds our chemicals that we make which we sell either locally or overseas. Further, it is going to be coinciding with the 16:26 16 minutes, 26 seconds commissioning soon to be commissioned ethanol distillery capacity expansion. 16:33 16 minutes, 33 seconds With all these factors taken together, we are seeing a much stronger environment for an integrated biorefiner 16:41 16 minutes, 41 seconds platform for biowease chemicals to grow in India and overseas. So we are definitely seeing a stronger outlook in 16:51 16 minutes, 51 seconds this financial year and this will be apparent from in the from this quarter onwards. That's that's the first point. 17:00 17 minutes As far as the distillery is concerned, we are going to be doing our commissioning trials next month for the grainbased facility. 17:13 17 minutes, 13 seconds Did I answer your questions, Milan? 17:15 17 minutes, 15 seconds Um yes. Um but I I mean so you know do you think that you know 17:24 17 minutes, 24 seconds this year during the next few quarters we would see the revenue mix kind of meaningfully shift into because to be 17:30 17 minutes, 30 seconds honest you know the FI25 revenue mix and 26 revenue mix are um nearly identical and you know the the bow waste uh this 17:39 17 minutes, 39 seconds thing remains at full 29%. groups. I mean, I just wanted to get an understanding on we did a fair amount of debuting of our 17:48 17 minutes, 48 seconds bio-based chemicals last year. It took us a little longer to penetrate markets 17:54 17 minutes, 54 seconds globally and in India with the new well I say the uh with the current 18:02 18 minutes, 2 seconds geopolitical environment we are and the competitiveness of the biiobased platform we are now finding that market 18:12 18 minutes, 12 seconds penetration to take place in this financial year beginning with this quarter onwards. So definitely you will 18:19 18 minutes, 19 seconds see a stronger the debottleing that we did last year will start showing its results in this financial year. 18:28 18 minutes, 28 seconds Mhm. Understood. Just just a small tack on if I could um you know for say cosmetic products you know like 13 uh 18:37 18 minutes, 37 seconds glycol etc. If I if we could get a sense of u you know the uptake that we might be seeing because you know those are higher marlin products etc. 18:48 18 minutes, 48 seconds uh you know recently you did the in cosmetics global as well. So if there if you could say bit more about what you know seems to be the landscape there. 19:00 19 minutes You know we make a fair number more than 20 chemicals from the biop-based sector. 19:06 19 minutes, 6 seconds Across the board there are some which are doing better and some which may do the same or less. Overall I would like 19:14 19 minutes, 14 seconds to say that under the current situation where the gap with the fossil price is being much higher the gap between fossil 19:23 19 minutes, 23 seconds and renewable has narrowed. So overall the business of biiobased chemicals shows greater promise in the current environment. 19:33 19 minutes, 33 seconds Understood. Thank you. 19:38 19 minutes, 38 seconds Thank you participants. If you wish to ask a question, you may press star N1. 19:45 19 minutes, 45 seconds The next question comes from the line of Suani Singh with Tja Capital. Please go ahead. 19:51 19 minutes, 51 seconds Hi, good morning. Um, so I just wanted to ask if you could pro provide an update on the biio-based chemical segment particularly in the light of 20:00 20 minutes challenges with water and share how demand trends and overall business conditions are shaping up now. 20:08 20 minutes, 8 seconds Thank you, Sani. Um you know as I mentioned just right now the 20:16 20 minutes, 16 seconds biiobased chemicals markets for budavari are right now showing a stronger outlook 20:23 20 minutes, 23 seconds the fundamental causes for that are that in if we com we compete in let's say two 20:30 20 minutes, 30 seconds places one is in India for with imports into India and overseas in markets which 20:38 20 minutes, 38 seconds we have competition from global competitors with energy, feed stock and raw material 20:46 20 minutes, 46 seconds costs getting higher because of the current geopolitical tensions and our model primarily looking at bgas as an 20:56 20 minutes, 56 seconds energy and ethanol as a feed stock remaining similar. Our competitiveness in global markets is there. So we are 21:04 21 minutes, 4 seconds seeing a broader outlook. imports into India are also more expensive right now. 21:09 21 minutes, 9 seconds So we are once again finding an ability to show penetrate the markets for our bioweas chemicals based on the 21:16 21 minutes, 16 seconds debottlenecking that we did last year much better this year. So that's a stronger outlook. You talked about the 21:25 21 minutes, 25 seconds water uh in last year was a very good monsoon. So as far as the current state 21:32 21 minutes, 32 seconds is concerned, the dams based on the water that India received last year were good and the crop around peninsula India 21:41 21 minutes, 41 seconds where we are has not suffered for lack of water. We of course will be looking 21:47 21 minutes, 47 seconds with always expectations as to how the coming monsoons will be to make sure that the climate continues to be positive. 21:58 21 minutes, 58 seconds Understood. Sir, if you could tell me what is the expected timeline for our outlicing out licensing the TNBC 22:05 22 minutes, 5 seconds molecule specifically at which stage of early clinical development you anticipate initiating partnering discussions and 22:13 22 minutes, 13 seconds what milestones would would trigger a formal out life sensing process. 22:21 22 minutes, 21 seconds Thank you for your question. We created a step down subsidiary called Sajen Therapeutics. 22:30 22 minutes, 30 seconds The idea of creating that step down subsidiary was to be able to present the work we do in the US and the world 22:39 22 minutes, 39 seconds markets with people who are specialized in communicating the story of drug discovery with particular reference to 22:46 22 minutes, 46 seconds our triple negative breast cancer drug discovery into this outlicicensing pharmaceutical world. So that is at one 22:54 22 minutes, 54 seconds level. Parallel to that we have completed safety trials for our molecule 23:02 23 minutes, 2 seconds and now we are preparing the application to the CDSCO for research in preliminary 23:09 23 minutes, 9 seconds efficacy. This trials we should be the application we will make in the next 23:15 23 minutes, 15 seconds quarter and then we will once we receive approval we will commence trials. 23:23 23 minutes, 23 seconds the process of talking to pharmaceutical uh possible potential outlicencies and 23:32 23 minutes, 32 seconds the trials will happen in parallel. We cannot predict when that will happen but provided that we continue to be 23:40 23 minutes, 40 seconds successful we hope for a time frame of 2 to three years. 23:46 23 minutes, 46 seconds I moved to one last question. While the West Asia crisis has created opportunities, did it also lead to 23:53 23 minutes, 53 seconds higher logistics freight or raw material volatality during Q4 particularly impacting the specialty segment, chemical segment? 24:04 24 minutes, 4 seconds Okay. What was the question? Were you stating something or were you asking a question? I'm sorry for for asking you. 24:11 24 minutes, 11 seconds So, I'll just repeat again. So while the West Asia crisis has created opportunities, did it also lead to higher logistics freight or raw material volatility during Q4? 24:22 24 minutes, 22 seconds Yes ma'am. 24:24 24 minutes, 24 seconds That is correct. Uh the West Asia crisis has also created some supply issues for some of our raw 24:32 24 minutes, 32 seconds materials and has also increased freight costs. So I we make as I said more than 24:39 24 minutes, 39 seconds about 20 molecules in the biiobased chemicals that we make. So some of these have faced challenges and some of these 24:48 24 minutes, 48 seconds we are seeing opportunities. So we might have seen the challenges in uh the last quarter and we are also now seeing how 24:56 24 minutes, 56 seconds to react to those challenges and how to see how we can rise to catcho meet the opportunities that they have created. 25:05 25 minutes, 5 seconds So was it particularly impacting the specialty chemical segment? 25:11 25 minutes, 11 seconds When there is a disruption, it would affect uh I would say the entire segment and now we are understanding how to deal 25:19 25 minutes, 19 seconds with that situation and we will see. So indeed definitely the logistics affected the chemical segment. 25:27 25 minutes, 27 seconds We hope that helps. Thank you very much. 25:34 25 minutes, 34 seconds Thank you. The next question comes from the line of Anil Sharma with Ras Capital. Please go ahead. 25:43 25 minutes, 43 seconds Hi sir. 25:44 25 minutes, 44 seconds Um sorry if this question might have been asked but um so so my question was regarding the grain distillery. 25:54 25 minutes, 54 seconds The catalyst um has now been guided for Q1 27 uh for three straight quarters and 26:02 26 minutes, 2 seconds equipment was given April March 26. So my question is has has it arrived and installation underway and uh separately 26:11 26 minutes, 11 seconds maze based ethanol is frozen since uh ESY 24 while maze 26:18 26 minutes, 18 seconds trades near MSP. So what gross spreads are you actually underwriting on the uh 60 million meters or could could this asset commission into a margin squeeze? 26:31 26 minutes, 31 seconds Can you repeat the question? I heard part of it. Your first question led was talking about 26:39 26 minutes, 39 seconds commissioning I guess and the second looked at the margins. Am I right? Can I just repeat? 26:45 26 minutes, 45 seconds Yeah. Yeah. I can I can repeat it. So the grain distillery has now been guided for next quarter I mean for this quarter uh Q127. 26:53 26 minutes, 53 seconds So as the equipment installed and arrived physically and separate regarding the maze based u ethanol 27:00 27 minutes prices that so the question one is that the you know I don't I I won't put a number but 27:08 27 minutes, 8 seconds almost all the equipment is on site there maybe you know one or two things here and there which is still being 27:15 27 minutes, 15 seconds awaited but most of the plant is erected and we are targeting commissioning 27:22 27 minutes, 22 seconds trials next month. So does that answer the first question? Uh yes sir. Yeah. 27:29 27 minutes, 29 seconds The second question is that uh we will be commission you know as you say we targeting commissioning in this next 27:36 27 minutes, 36 seconds month and we will have be currently the government has announced prices for mazebased ethanol and we will be buying 27:45 27 minutes, 45 seconds maze uh to make the ethanol into the blending program. We will of course the larger benefits will come of this 27:55 27 minutes, 55 seconds facility in the coming ethanol year from November onwards. In the meantime, we 28:02 28 minutes, 2 seconds could also be looking at the ethanol that we produce to meet our needs for our biiobased chemicals facility because 28:12 28 minutes, 12 seconds imports of ethanol have become more expensive in the West Asia crisis. So we are also looking at our integrated uh 28:21 28 minutes, 21 seconds platform going from as we say soil all the way to chemicals and see how we can use also our ethanol surpluses to meet our own demand. 28:31 28 minutes, 31 seconds Okay, got it. And uh just another quick question from my end. Uh was it actually a deliberate choice to run more acetate 28:40 28 minutes, 40 seconds for better near-term margin or um did something happen in the specialtity volume customers that we couldn't 28:48 28 minutes, 48 seconds replace or I just wanted to understand on the speciality mix drop? I would say 28:54 28 minutes, 54 seconds that the larger strategic objective is to continue to make more biio-based 29:02 29 minutes, 2 seconds specialtity chemicals. So that is our what I will say long-term strategic objective. At the same time, if we do 29:11 29 minutes, 11 seconds see an opportunity in ethile acetate margins with our ethanol production, we 29:19 29 minutes, 19 seconds are we are large producers of ethanol and if we see an opportunity in utilizing that ethanol into making 29:27 29 minutes, 27 seconds ethile acetate at a margin particularly since you see in the current year ethanol blending program supply is much 29:35 29 minutes, 35 seconds greater than demand. So we are just being smart about it. If you see an opportunity you're long in ethanol then we will make the ethylacetate to make 29:43 29 minutes, 43 seconds the margin. So strategic objective of bio specialtity chemicals remain and if there is an opportunity to do ethile 29:51 29 minutes, 51 seconds acidate business if margins are there we will do that. Okay sir. Thank you. 30:01 30 minutes, 1 second Thank you. 30:03 30 minutes, 3 seconds The next question comes in the line of Granty Beth with Wealth Build Securities. Please go ahead. 30:11 30 minutes, 11 seconds Yeah. 30:11 30 minutes, 11 seconds Hi sir, congratulations for the resilient quarter and set of numbers. 30:16 30 minutes, 16 seconds With respect to uh the global crude oil prices, the energy prices they have been so much volatile. We witnessed the crude 30:23 30 minutes, 23 seconds oil swinging between 110 20 and again back to 90. So these kind of things uh the volatility heightened volatility in 30:32 30 minutes, 32 seconds the crude oil prices how much benefit uh uh the uh gavari buy 30:39 30 minutes, 39 seconds what is your net realization with respect to ethanol is concerned can you repeat the question on the 30:48 30 minutes, 48 seconds volatility of crude oil prices because yeah the crude oil prices have been volatile swinging between $90 30:57 30 minutes, 57 seconds at present. A week back it was around $110 per barrel. Uh so this kind of volatality how God bio is positioned to 31:07 31 minutes, 7 seconds take the advantage in the medium to short term. 31:10 31 minutes, 10 seconds So you know when the oil prices increase then they are making broad 31:19 31 minutes, 19 seconds our energy prices come fundamentally from coal and bag and bag being about 85% of that. 31:26 31 minutes, 26 seconds So when we compete in the market with our energy costs remaining where they are or even our raw materials are 31:34 31 minutes, 34 seconds primarily ethanol we compete in the world with people who have fossil resources. So it just helps us to be a 31:43 31 minutes, 43 seconds little more competitive in the current environment. Secondly, it is also driving the government of India to 31:51 31 minutes, 51 seconds examine how they could look at ethanol blending beyond the E20. If you look, 31:58 31 minutes, 58 seconds they have also notified draft standards of E85 and E 100 and beyond E20. So, you 32:06 32 minutes, 6 seconds are looking at a larger ethanol blend as we go forward and that would create a 32:13 32 minutes, 13 seconds greater demand in the future. You know we should remember that the earlier E20 target was for 2030. We achieved it as a 32:22 32 minutes, 22 seconds nation by 5 years in advance. So the government must also be given time to look at what new policies it should put 32:30 32 minutes, 30 seconds in place given the surplus of ethanol in the country. This energy crisis has only 32:36 32 minutes, 36 seconds further uh I would say strengthened the resolve of the government and the country to be more self-reliant in 32:44 32 minutes, 44 seconds energy. So it is positions us in a strong place both in the biiobased chemical space as well as in the ethanol space. 32:54 32 minutes, 54 seconds How you how you are foreing the demand for ethanol in the medium to short term. 33:00 33 minutes So the medium to short term the government I I repeat what they will they are trying notifying higher blends 33:08 33 minutes, 8 seconds of ethanol draft standards have been notified. 33:12 33 minutes, 12 seconds So the government will have to articulate a policy of what they see in the years to come. It will also reflect 33:19 33 minutes, 19 seconds on what are the policies to encourage flex fuel cars because it will be those cars that will be able to take the 33:26 33 minutes, 26 seconds higher ethanol blend rates. So but the direction is clear. If the government is 33:32 33 minutes, 32 seconds announcing E85 and E00 blend standard then in the future this would come into 33:39 33 minutes, 39 seconds the market and it would have to be together with the uh flex fuel cars in 33:46 33 minutes, 46 seconds the country. So that is one. Secondly, we are also a integrated biorefinery. So our own ethanol can feed our growing demand for ethanol to make chemicals. 34:00 34 minutes What is your current net realization on ethanol? Sir, could you give uh some figure on that? Sir, ethanol prices are declared by the 34:08 34 minutes, 8 seconds government. They have prices for B heavy molasses to ethanol. They have juice to ethanol and they have grain to ethanol. 34:15 34 minutes, 15 seconds It's all declared. It's a if it's one price for the anybody in the country means one means one price for each feed stock. 34:26 34 minutes, 26 seconds What is your net realization sir? The gross margin for ethanol s net realization from B molasses I think it 34:33 34 minutes, 33 seconds is about 60 60 plus at juice to ethanol it is about 65 plus and for maze to ethanol it is around 72. 34:45 34 minutes, 45 seconds Okay sir thank you. 34:51 34 minutes, 51 seconds Thank you. The next question comes from the line of Somia Raguanchi with Nva Capital. Please go ahead. 35:10 35 minutes, 10 seconds Somia, your line has been unmuted. Please go ahead with your question. Uh, I'm so sorry. Uh, good morning sir. 35:18 35 minutes, 18 seconds Thank you so much for taking my question. Can you please discuss on your expectations around the ethanol price revision? Specifically, what timeline 35:26 35 minutes, 26 seconds you foresee for regulatory action, the magnitude of revision that could be meaningful for the industry and how such changes could impact your cost 35:34 35 minutes, 34 seconds structure, lending economics and overall margin trajectory in the near term. 35:40 35 minutes, 40 seconds Thank you for the question. Uh the answer uh I am not sure I can have for 35:48 35 minutes, 48 seconds you. The price revisions for ethanol are a subject matter for the government of 35:54 35 minutes, 54 seconds India to decide. The industry has requested the government to increase the 36:03 36 minutes, 3 seconds ethanol blend pricing in light of continuous increase of sugar cane price over the past 3 years and no 36:11 36 minutes, 11 seconds corresponding change in the ethanol price coming from either be molasses or sugar cane juice or syrup. At the same 36:20 36 minutes, 20 seconds time the directionality of improving demand is there with the issuance of 36:28 36 minutes, 28 seconds draft standards for E85 and E00. When that happens automatically today there is a supply surplus of ethanol and once 36:37 36 minutes, 37 seconds greater demand is created we should find both the demand also to increase in 36:45 36 minutes, 45 seconds light of the west Asia crisis and higher energy prices which we now see translating into higher prices at the 36:53 36 minutes, 53 seconds pump creating a system in which we are more self-reliant in energy coming from the sun and our source oil and the 37:02 37 minutes, 2 seconds farming community that we have in the country. We definitely believe that the government should should do policy 37:09 37 minutes, 9 seconds measures to help the econom viability in the country. 37:16 37 minutes, 16 seconds Okay sir, noted. So can you please update on the DME project converting carbon dioxide and hydrogen? What stage 37:24 37 minutes, 24 seconds has the pilot currently reached and what key technological mile milestones such as catalyst performance and scale of visibility along with economic 37:33 37 minutes, 33 seconds milestones like cost competitiveness uh regulatory clearance and optic agreements must be achieved before commercialization. 37:41 37 minutes, 41 seconds Ma'am, this is still too early. What to refresh our memory? First this was done in the pilot in a laboratory plant at the Institute of Chemical Technology. 37:52 37 minutes, 52 seconds That was complete. Then we put up the pilot plant. We are currently in the process of running this pilot plant and 38:00 38 minutes trying to see how it would function. The process of research on the pilot plant should take a process of another 3 to 6 months at the end of which we will be 38:09 38 minutes, 9 seconds able to give a better answer to the questions you are asking. Okay sir. So just one last question. 38:17 38 minutes, 17 seconds Management highlighted that multi- feed stock flexibility as a key differentiator. Can you please quantify the cost advantage of margin protection 38:25 38 minutes, 25 seconds achieved through feed stock diversification during FI26? 38:30 38 minutes, 30 seconds No ma'am this multif feed stock uh will happen once the maze facility is in 38:37 38 minutes, 37 seconds place which will be uh commissioned commissioning trials will happen next month. So you will see the benefit of 38:45 38 minutes, 45 seconds that business model going forward. It helps mitigate climate risks, policy risk and feed stock risk. So these are 38:54 38 minutes, 54 seconds the risks we deal with in terms of multi-product. What we had said is we make ethanol of various grades. So we make ethanol for the blending program. 39:03 39 minutes, 3 seconds We make ethanol of the ENA grade and we make ethanol for other grades. So in this past year we made ethanol of about 39:12 39 minutes, 12 seconds equivalent ethanol of 98 million liters and of that some of the ethanol we made also went into the ENA market and also 39:21 39 minutes, 21 seconds other grade. So when you had a supply surplus having this multiple product 39:28 39 minutes, 28 seconds possibility helped us run the capacity of our distilleries. That was the point. 39:34 39 minutes, 34 seconds So you are looking at it from both ends multi-roduct to run it and multif feed stock once it is operational for climate policy and feed stock risk. 39:44 39 minutes, 44 seconds Okay sir. Got it. That's it from my side. Thank you so much. Thank you. 39:53 39 minutes, 53 seconds Ladies and gentlemen, if you wish to ask a question, you may press star and one. 39:59 39 minutes, 59 seconds The next question comes from the line of Bal Sharma with DB Capital. Please go ahead. 40:07 40 minutes, 7 seconds Hello. Hi. Good morning. Good morning. 40:11 40 minutes, 11 seconds Yeah. So I wanted to ask that uh global customers are incre in increasingly shifting towards biiobased solutions 40:19 40 minutes, 19 seconds right so are you seeing uh long-term contracts of strategic sourcing partnerships like which is emerging with 40:26 40 minutes, 26 seconds multinational customers especially in uh Europe and US. 40:32 40 minutes, 32 seconds Thank you for the question. So Godavi in its strategy actively co-creates with 40:39 40 minutes, 39 seconds customers globally to find biio-based solutions, substitutes or supplements to 40:46 40 minutes, 46 seconds what is otherwise bought in the fossil market. What we are definitely seeing is 40:52 40 minutes, 52 seconds a gap narrowing between what would be higher biiobased prices versus lower 40:59 40 minutes, 59 seconds fossil prices. This gap is narrowing. As a result of that, we are finding that there is definitely a possibility of 41:08 41 minutes, 8 seconds increase in demand in this financial year. Secondly, we also make chemicals in segments which 41:15 41 minutes, 15 seconds are such as cosmetics or fragrances in which biiobased solutions have a natural advantage. So given that our cost 41:25 41 minutes, 25 seconds structure has largely remained the same which is with our feed stock of ethanol or with bagas based energy or with a 41:34 41 minutes, 34 seconds little bit of coal based energy that we've produced we are also finding our competitiveness much stronger and also 41:41 41 minutes, 41 seconds they find it uh more competitive to buy from India at this current moment. So we are definitely seeing an uptick in demand this financial year. 41:53 41 minutes, 53 seconds Great great help. Uh one more question that uh ethanol equivalent sales uh 41:59 41 minutes, 59 seconds reach uh 98 million liters in FI25 with 81% contributed under the EBC program. 42:07 42 minutes, 7 seconds So as industrial usage and export opportunities expand does management anticipate a material shift in this mix 42:14 42 minutes, 14 seconds going forward and like how might the balance between EVP industrial and export channel evolve over the medium terms. 42:23 42 minutes, 23 seconds We see the EBP program as the main outlet of our ethanol production. the 42:31 42 minutes, 31 seconds other grades for ENA or for other grades of ethanol which go into various segments that could be in the farmer 42:38 42 minutes, 38 seconds segment it could be in the in the cosmetic or fragrance segment or it could be also supplying to the ethanol 42:46 42 minutes, 46 seconds needs but ethanol blending program continues to be our focus for growth as the government continues to target more 42:55 42 minutes, 55 seconds self-reliance of energy in the Understood. 43:03 43 minutes, 3 seconds But you know the point being that we want to make sure that we have the resilience to react to demand supply 43:10 43 minutes, 10 seconds gaps. If supply is in surplus, we are able to run our facilities at capacity. 43:17 43 minutes, 17 seconds Okay. Understood. 43:20 43 minutes, 20 seconds And uh one more last question uh that uh the company plans to commission the 200 KPD grainbased distillary by June 2026. 43:29 43 minutes, 29 seconds Right. So adding 60 million L of annual capacity. What is the expected capex as it turns and aida potential from this 43:38 43 minutes, 38 seconds project at normalized utilization levels? 43:42 43 minutes, 42 seconds And we will commission this facility. uh the trials of commissioning will start taking place in June and there is some 43:51 43 minutes, 51 seconds business that we will do in the coming quarter which is in uh Q2 and after that it will also depend on the government 43:59 43 minutes, 59 seconds ethanol blending program and its targets and prices for the particular sector which they will probably announce by 44:07 44 minutes, 7 seconds sometime around September of or October of 2026. At that time we will be in a better position to state how that looks. 44:15 44 minutes, 15 seconds We'll also of course be looking at what the monsoons are like to understand how the crop will be and the pricing of the feed stock. 44:25 44 minutes, 25 seconds Oh okay. Okay. Thank you so much and all the Thank you. 44:37 44 minutes, 37 seconds Thank you ladies and gentlemen. Due to time constraint, this will be our last question. It's on the line of V Rangan, an individual investor. Please go ahead. 44:48 44 minutes, 48 seconds [clears throat] 44:48 44 minutes, 48 seconds Good afternoon, sir. 44:52 44 minutes, 52 seconds Can you see why our profitability has fallen from the 95 crores in the last 44:58 44 minutes, 58 seconds 31st March 2025 to 66 crores the current quarter 30th March 2026 45:06 45 minutes, 6 seconds and how much will be the current year expansion will be there and what will be the profitability in a 45:13 45 minutes, 13 seconds years to the quarters to come it will be on the line of 55 crores or something like that can you come close some line about Thanks. 45:22 45 minutes, 22 seconds So what I would like to say is that the margin pressure took place because the government had announced a increased 45:29 45 minutes, 29 seconds price of sugar cane for the last crushing season and did not increase the 45:37 45 minutes, 37 seconds MSP of sugar and neither did they increase the price of the ethanol blend. 45:43 45 minutes, 43 seconds So that created margin pressure in the business. Going forward we are looking at better business in the biiobased 45:52 45 minutes, 52 seconds chemical sector as well as the commissioning of the maze blaze ethanol will also lead to an addition of 46:00 46 minutes profitability in the coming year. So this is how we see it going forward. 46:13 46 minutes, 13 seconds Thank you sir. 46:15 46 minutes, 15 seconds Ladies and gentlemen, that was the last question for today. I now hand the conference over to Sam for closing comments. 46:26 46 minutes, 26 seconds Thank you very much all for coming and taking the time to attend our conference today and thank you for continuing to 46:34 46 minutes, 34 seconds place your trust in our company as we grow to build a more sustainable, beautiful and inclusive world. Thank you very much. 46:47 46 minutes, 47 seconds Thank you on behalf of MUFG in time. 46:50 46 minutes, 50 seconds That concludes this conference. Thank you for joining us and you may now disconnect your lines. Thank you.