Gulshan Polyols Limited — Q3 FY26

Gulshan Polyols Ltd Q3 FY2025-26 Earnings Conference Call https://www.youtube.com/watch?v=XLZ2raTK-MA Published: 3 months ago

0:00 Ladies and gentlemen, good day and welcome to Q3 FI26 earnings conference 0:06 6 seconds call hosted by Gulen Polyols Limited. As a reminder, all participant lines will be in the listen only mode and there 0:14 14 seconds will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during this conference call, please 0:21 21 seconds signal an operator by pressing star then zero on your Touchstone phone. Please note that this conference is being 0:28 28 seconds recorded. I now hand the conference to Mr. Viral J from Share India Securities. Thank you and over to you Mr. J. 0:38 38 seconds Thank you and good afternoon everyone. 0:41 41 seconds Congratulation on a very good set of numbers. On behalf of Share India Securities, I welcome you all to Q3 FY26 0:49 49 seconds earnings conference call of Gulchan Polyors. We are pleased to have with us the management team represented by joint 0:57 57 seconds managing director Aditi Pasari, CFO Rajiv Gupta and compliance officer Priti Singhal. We'll have the opening remarks 1:05 1 minute, 5 seconds from the management followed by the question and answer session. Thank you and over to you ma'am. 1:14 1 minute, 14 seconds Uh good afternoon everyone and thank you for joining us for the Q3 FY26 1:22 1 minute, 22 seconds earnings conference call of Gulchin Collars Limited. 1:26 1 minute, 26 seconds With me today is Mr. Rajiv Gupta, our chief financial officer and our compliance officer Miss Pitti Single. 1:34 1 minute, 34 seconds I trust you have had the opportunity to review our financial results and investor presentation. 1:41 1 minute, 41 seconds Gulchin corals is a multi-product multilocation company with operations spanning ethanol, grainbased specialty 1:48 1 minute, 48 seconds products such as corbitol, starch and fructose and mineral based chemicals including calcium carbonate and various 1:56 1 minute, 56 seconds grades of calcium carbonates. We operate nine manufacturing facilities across Madhya Pradesh, Gujarat, Uttar Pradesh, 2:04 2 minutes, 4 seconds Assam, Balakuma, Abu Road and few more on-site facilities across India. 2:11 2 minutes, 11 seconds Before I begin my remarks, I am pleased to share that we have delivered earnings in line with our guidance. For Q3, our 2:19 2 minutes, 19 seconds consolidated EITA margins at 13.7% and for the 9month period, it was 9.4% 2:26 2 minutes, 26 seconds consistent with our stated guidance range of 9 to 10%. 2:30 2 minutes, 30 seconds Martin expansion during the quarter was primarily driven by the softening of raw material prices which had a positive impact. A key contributing factor was 2:40 2 minutes, 40 seconds the government's mandate requiring ethnol producers to procure 40% of their rice requirements from FCI at a fixed 2:48 2 minutes, 48 seconds price. This policy has softened open market prices for our key raw material made and broken rights by improving 2:56 2 minutes, 56 seconds overall grain availability and liquidity in the system. 3:01 3 minutes, 1 second As a result, this improvement in input cost dynamics has translated into stronger operating leverage and enhanced 3:08 3 minutes, 8 seconds profitability for the quarter. Looking ahead, we remain confident in our ability to sustain these margins with a 3:16 3 minutes, 16 seconds guided range supported by stable policy conditions and disciplined execution. 3:21 3 minutes, 21 seconds Starting with the operating environment, a key policy development during ESY 2526 has been the government's mandate 3:29 3 minutes, 29 seconds requiring 40% usage of STR rice for ethanol production. This has materially eased pressure on alternate feed stocks 3:36 3 minutes, 36 seconds such as broken rice and maze improving overall grain liquidity and enhancing the overall raw juice availability in 3:43 3 minutes, 43 seconds the country. As a result, the ethnol segment has been meaningful margin improvement even before factoring in 3:50 3 minutes, 50 seconds state incentives. While availability has remained adequate, raw material price volatility continues to escape the 3:58 3 minutes, 58 seconds calibrated procurement and inventory planning. Additionally, as state incentives begin to flow through the P&L, we expect further improvement in 4:06 4 minutes, 6 seconds bottomline performance. Domestic consumption across endus industries remain stable during the quarter. In response, we continued with our 4:14 4 minutes, 14 seconds staggered and riskmanagement procurement strategy, reducing exposure to peak pricing cycles and improving cost visibility. 4:23 4 minutes, 23 seconds From an input from industry standpoint, 20% ethnos lending represents the first major milestone to assess industry 4:31 4 minutes, 31 seconds readiness, feed stock availability and capacity scalability. India's smart program continues to deliver structural 4:39 4 minutes, 39 seconds benefits by reducing crude oil imports, saving foreign exchange and supporting farmers and rural development. Overall, 4:47 4 minutes, 47 seconds the medium to long-term we see India's road map moving closer to grow global uh benchmarks such as the deal uh in 4:54 4 minutes, 54 seconds blending petroleum with ethanol. While 20% is the current milestone, higher blending levels are achievable over time 5:02 5 minutes, 2 seconds and yeah, we positively expect this blending ratio to go up in the near future. 5:09 5 minutes, 9 seconds Turning to segment performance, we delivered our strongest results to date in the ethanol business. Growth during 5:16 5 minutes, 16 seconds the quarter was driven by successful capacity ramp up at our plants in Madhya Pradesh and Assam. Ethanol continues 5:23 5 minutes, 23 seconds continues to be the primary growth engine for the company. We currently have orders of approximately 1,200 5:30 5 minutes, 30 seconds crores translating into about 17 criter for ESY 25 and 26. 5:37 5 minutes, 37 seconds Our total ethmo production capacity stands at 26 criter. 5:42 5 minutes, 42 seconds We expect the allocations to increase further in the upcoming center cycles uh of C2C3 C4 over the over this year. The 5:51 5 minutes, 51 seconds grain processing segment continues to face headwinds due to industry like old capacity in starch. As a result, star 5:58 5 minutes, 58 seconds prices remain under pressure. However, starch now represents a relatively small portion of a revenue mix. As highlighted 6:07 6 minutes, 7 seconds earlier, we have rationalized lossmaking starch volumes while maintaining profitability in soil and fructose. We expect a gradual recovery as industry conditions normalize. 6:19 6 minutes, 19 seconds The mineral chemical segment delivered steady performance in line with expectations supported by steady demand, 6:26 6 minutes, 26 seconds longstanding customer relationships and consistent operational execution. This business continues to provide margin resilience and predictable cash flows. 6:36 6 minutes, 36 seconds Before moving to the outlook, I would like to highlight that the company has received a total amount of 21.8 8 cr 6:43 6 minutes, 43 seconds from NPIDC uh towards state incentives and industry promotion incentives related to our Madhya Pradesh operations. This receipt sends our cash 6:52 6 minutes, 52 seconds growth and reflects continued policy level support for ethanol and agro processing investments. I would also like to clarify that the PLI related 6:59 6 minutes, 59 seconds incentives has been factored in into our deployed EITA margins for this for this quarter. 7:05 7 minutes, 5 seconds Looking ahead, we remain constructively optimistic and expect to achieve full utilization of our distillary capacity 7:12 7 minutes, 12 seconds in FI 26 and 27. This outlook is supported by improving industry demand and a gradual normalization across N 7:20 7 minutes, 20 seconds markets which would enable higher utilization and operating leverage across segments. The mineral chemical 7:28 7 minutes, 28 seconds business is expected to continue operating at steady capacity delivering predictable cash flows and consistent margins. 7:35 7 minutes, 35 seconds For FI26, we remain on track to deliver a top line of about 2,300 crores driven entirely by optimization and high 7:44 7 minutes, 44 seconds utilization of existing capacities with no incremental capex planned. Evita margins are expected to be in the 9 to 7:51 7 minutes, 51 seconds 10% range at the at the consolidated level with the atal segment delivering 10 to 11% operational margins. Looking 7:58 7 minutes, 58 seconds ahead to FI27, we aspire to achieve 2600 to 2,800 cr in revenue assuming 80 to 8:06 8 minutes, 6 seconds 90% utilization across all divisions. We are closely monitoring whether the 3,000 cr milestone can be achieved without 8:13 8 minutes, 13 seconds additional uh capital expenditure led by continued ethanol ramp up and operational efficiencies. Overall, our 8:21 8 minutes, 21 seconds strategic priorities remain firmly centered on discipline capital allocation, operating efficiency and long-term value creation. With that, I 8:30 8 minutes, 30 seconds now hand over to Mr. Rajiv Gupta to take you through the financial performance. 8:36 8 minutes, 36 seconds Thank you Aditi G and uh good afternoon to everybody. 8:41 8 minutes, 41 seconds uh as already Aditi has has said that there is an improved mark improved performance the company has given for 8:48 8 minutes, 48 seconds the quarter three there is a strong operational financial performance reflecting uh both earning recovery and 8:55 8 minutes, 55 seconds improving business mix revenue for the quarters stood at 626.7 crately 9:03 9 minutes, 3 seconds driven by ramp up ramp up in the ethron segment this growth was partially offset by continued Adwords in the grain 9:11 9 minutes, 11 seconds processing segment while the while our mental chemical segment remains stable. 9:18 9 minutes, 18 seconds Our aid margin also increased by 111% Y to 85.6 cr supported by softing input prices. 9:29 9 minutes, 29 seconds Importantly this improvement came despite the underperformance in grains processing business segment of the company. Aida margins expanded by 920 9:39 9 minutes, 39 seconds basis point Y which comes to 13.7% indicating a structurally stronger 9:45 9 minutes, 45 seconds earning base as newly commission ethanol capacity begin to scale scale up our 9:52 9 minutes, 52 seconds profit after tech grew up by 501% to 40.9 cr rupees 10:00 10 minutes reflecting both improved operating performance and margin recovery overall the quarter demonstr state that as input 10:07 10 minutes, 7 seconds input cost normalize and as long cap capacity ramp up the business is trans transisting transiting to a stronger and 10:16 10 minutes, 16 seconds more sustainable earning prof profile positioning it well for medium-term growth. 10:27 10 minutes, 27 seconds I think uh with this uh uh I would like to uh add up my uh my uh my address to 10:35 10 minutes, 35 seconds the address to the investor. Now it is now open for the floor to the for questioning. Any question regarding the 10:42 10 minutes, 42 seconds performance of Thank you very much. We will now begin with the question and answer session. 10:49 10 minutes, 49 seconds Anyone who wishes to ask a question may press star and one on datas telephone. 10:54 10 minutes, 54 seconds If you wish to remove yourself from the question, you may press R2. 10:59 10 minutes, 59 seconds Participants are requested to use handsets while asking a question. 11:04 11 minutes, 4 seconds Ladies and gentlemen, we will wait for a moment while the questions. 11:09 11 minutes, 9 seconds Participants, you may press start and one to ask a question. 11:21 11 minutes, 21 seconds First question is from the line of Kushkar Jen from Capital Management. Please go ahead. 11:27 11 minutes, 27 seconds Hi um ma'am congratulations for great set of numbers. Uh I just wanted to ask about the current means prices and your 11:35 11 minutes, 35 seconds outlook for the year and uh because of the softening do you expect uh that uh 11:42 11 minutes, 42 seconds uh like if dates out of me prices there is a chance that government would reduce the prices in the next season? Uh just 11:49 11 minutes, 49 seconds wanted to uh understand your view regarding that. Thanks. 11:54 11 minutes, 54 seconds Uh so current pay prices are varying between uh 18 to 21 rupees across India. 12:01 12 minutes, 1 second Uh in our Madhya Pradesh plant the current M prices at about 18 to 19 rupees and in Asam plant it is about uh 12:08 12 minutes, 8 seconds 20 to 21 rupees. So uh regarding the government taking away the um or 12:16 12 minutes, 16 seconds reducing the male ethnol prices uh see actually there has been a pressure from the ethnol industry on the government due to receiving lower allocations. 12:24 12 minutes, 24 seconds Uh a lot of units have including us have received lower allocation than what it was applied for because of over capacity of ethanol uh production in the country. 12:35 12 minutes, 35 seconds Hence uh they're already under pressure and uh then in fact a lot of uh a lot of uh units have received allocation as low 12:42 12 minutes, 42 seconds as 20 to 30% of the total capacity. So keeping uh considering all of these factors we are not we don't think that 12:51 12 minutes, 51 seconds the government will put further pressure on it on the ethanol industry by uh reducing the uh prices of maze ethanol. 12:59 12 minutes, 59 seconds Right. Thanks a lot. 13:03 13 minutes, 3 seconds Thank you participants. You may press star and one to ask the question. 13:09 13 minutes, 9 seconds Next question is from the line of Nishita from Safia Capital Partners. Please go ahead. Yes. Hello. 13:18 13 minutes, 18 seconds Hello. So yeah. So as you mentioned that the grain processing segment went like phase headwinds in the quarter and uh 13:26 13 minutes, 26 seconds that's like contributing 147 crores of revenue and the mahajin is very less compared to the other two segments. So 13:34 13 minutes, 34 seconds going forward uh like are we going to reduce the contribution from that segment or how are we going to see the revenue contribution from the three segments going forward. 13:46 13 minutes, 46 seconds So I'll answer the second question first. uh going forward we are uh or even this current year or the next year uh we are expecting uh in the current 13:54 13 minutes, 54 seconds year we're expecting a revenue contribution of about u uh 1,400 to 1500 crores coming from the ethanol division 14:02 14 minutes, 2 seconds alone and um about uh 800 crores coming from the grain processing division and balanced from mineral. So the revenue 14:11 14 minutes, 11 seconds mix will remain consistent in this direction even for the next year. uh more than 60% of the revenue will be coming from the ethanol division and 14:19 14 minutes, 19 seconds balanced from the mineral and grain processing division. Uh well uh the margins have been stressed for the grain 14:26 14 minutes, 26 seconds processing especially for starch. So is still doing all right. It is in positive but it is starch business which has been 14:33 14 minutes, 33 seconds pulling it down and uh we are working on it how to improve the margins. We are actually uh we are working on the power 14:41 14 minutes, 41 seconds and fuel cost. We have introduced an RDF boiler uh in our Musufanagar plant which will help us bring down the power and fuel cost and uh improve the operational 14:50 14 minutes, 50 seconds margins. So we are trying various ways how we can uh work on this segment to improve the overall margins. Uh the 14:57 14 minutes, 57 seconds impact should start coming in uh next 3 months. So we are hopeful that the margins will improve going forward from here. 15:06 15 minutes, 6 seconds Okay. So uh in I27 do we see the uh like overall consolidated margins at the same 15:13 15 minutes, 13 seconds 10 to 11% range or can we expect better margins? 15:19 15 minutes, 19 seconds Uh consolidated margins we are expecting in the range of 9 to 10%. 15:25 15 minutes, 25 seconds For FI27 as well for FI27 as well. Yeah. 15:30 15 minutes, 30 seconds Okay. Okay. And uh the last thing if you can just uh reiterate your guidance for FI27 was it 2600 to 2,800 cr. 15:39 15 minutes, 39 seconds Yes, that is uh that is our target for the next year at about 15% uh capacity 15:46 15 minutes, 46 seconds uh ramp up from here and that will be at 90% utilization right 15:53 15 minutes, 53 seconds that will be at about 80 85% capacity utilization we have scope with the current capeex current infrastructure we 16:00 16 minutes have scope to go up to 3,000 crores but that again depends on market dynamics and the tender allocation from the OMC 16:08 16 minutes, 8 seconds so uh But uh looking at the current scenario, we think 2600 to 2,800 K should be a reasonable guidance for FI27. 16:19 16 minutes, 19 seconds Okay. So uh do we have any basics plans for FY27? Then once we reach the max 16:27 16 minutes, 27 seconds capacity utilization, the current plan, how do we see a scaling forward? 16:33 16 minutes, 33 seconds Uh so for uh for until FYI 27 we are actually fully focused on improving our cash flow giving out good results 16:41 16 minutes, 41 seconds quarter and quarter and improving the cash flows and reducing the u working capital utilization. Uh any kind of 16:48 16 minutes, 48 seconds fresh capex will come in FI28 but before that we will be spending FI27 in the in 16:55 16 minutes, 55 seconds our planning stage for the next set of capeex which will come in FI28. 17:02 17 minutes, 2 seconds run. Okay. And the last question would be what is the current capacity utilization? 17:10 17 minutes, 10 seconds Uh so current capacity utilization in the ethnol segment and the grain processing segment is about 65 to 70%. 17:19 17 minutes, 19 seconds Okay. Okay. Understood. Thank you so much. 17:24 17 minutes, 24 seconds Thank you. Next question is from the Pratik Singha from Page One Investments. Please go ahead. 17:31 17 minutes, 31 seconds Yeah. Hi, good afternoon. Uh my question is with respect to uh the macro uh that uh with respect to the bay starch uh 17:41 17 minutes, 41 seconds product like how do you see India trying to recapture the lost market share that in the export market uh that we had uh 17:50 17 minutes, 50 seconds prior to the maze prices reaching the roof roof kind of a pricing. 17:59 17 minutes, 59 seconds Uh can you please repeat your question? It's not clear to me. 18:02 18 minutes, 2 seconds I'm saying with respect to the India's export market, India business uh by when do you think that we can recapture the 18:11 18 minutes, 11 seconds lost market share in the in the export uh market? 18:16 18 minutes, 16 seconds Uh see it is all a game of uh demand and supply and the prices because eventually it starts with the raw material for the 18:24 18 minutes, 24 seconds end product. So uh there has been a correction in maze prices uh in the recent last few months. So already the 18:32 18 minutes, 32 seconds export from India for starch has picked up once again which had totally dropped because of maze prices uh going uh being 18:40 18 minutes, 40 seconds unviable. So uh yeah in this coming year we think that uh the export of starch should pick up and uh the uh uh the domestic demand should ease off. 18:53 18 minutes, 53 seconds Okay. So it has not picked up as of now because I thought like uh starting December it should have already picked 19:00 19 minutes uh a bit uh with respect to the export given the price. 19:03 19 minutes, 3 seconds Yes it has picked up. It has picked up and uh as compared to last cycle this 19:09 19 minutes, 9 seconds cycle uh China in the base uh commodity or the base product uh it has also 19:18 19 minutes, 18 seconds rammed up a lot of exports. So how do you see Chinese as a competition now? 19:22 19 minutes, 22 seconds because earlier they were quite focused towards value added product but as compared to uh uh earlier like now they 19:30 19 minutes, 30 seconds are also focused in the base uh uh starch products. So what's your view with respect to the increased competition from China 19:40 19 minutes, 40 seconds uh uh so as I said that it is all a game of uh demand and supply. So with the with the current maze levels, India is 19:50 19 minutes, 50 seconds again back in the game. It is again competitive. So we are already exporting uh sorbital to about 45 countries. The 19:57 19 minutes, 57 seconds export has gone up in last few months because of the price competitiveness and even starch has picked up again. S 20:05 20 minutes, 5 seconds exports have picked up again. So at when mice when m which is is at a level of 17 20:11 20 minutes, 11 seconds to 18 rupees a kg it becomes competitive uh for world exports 20:18 20 minutes, 18 seconds right but you see uh a like large wallet of uh the customer getting captured or like currently serviced by a Chinese guy 20:27 20 minutes, 27 seconds which was which was not the case like uh like say 3 4 years back any such trends which is visible 20:37 20 minutes, 37 seconds Oh yes definitely in fact that is the reason why our grain processing business has got hit because uh uh because India 20:46 20 minutes, 46 seconds was losing to China in the export market and as a result of which all the production of Saskat 20:52 20 minutes, 52 seconds was getting dumped back into the country as a result of which the price was falling and the process and these products are getting u are running in negative. 21:04 21 minutes, 4 seconds Okay. And given your experience with the customer uh like by when do you think uh this uh export revenue uh which was 21:12 21 minutes, 12 seconds there uh at the peak uh in last 2 three years that can be achieved again by the company. 21:19 21 minutes, 19 seconds So this year is looking like a good year for the maze crop uh in the Rabi uh crop is expected to be good. I mean the kar 21:26 21 minutes, 26 seconds crop is expected to be good. So uh if the maze levels come down to 16 to 17 to 18 rupees a kg then India becomes very very competitive. 21:38 21 minutes, 38 seconds Okay thank you so much. Thank you. 21:44 21 minutes, 44 seconds Next question is from please go ahead. 21:50 21 minutes, 50 seconds Yeah uh thank you for giving me this opportunity. Uh my question is from a micro uh micro perspective. Uh with 21:58 21 minutes, 58 seconds India's ethanol blending road map evolving, how should we think about the sustainable utilization levels across the distillery capacity? 22:09 22 minutes, 9 seconds Uh so if you are talking about our own plants in Bad Federation Assam, both the plants have signed a long-term officer 22:20 22 minutes, 20 seconds of the total capacity of 26 cr liter out of which 13 cr is an long-term optic agreement which has already been signed 22:27 22 minutes, 27 seconds which is 50% of the capacity. uh balance uh this year we have already received allocation of 70% which we are expecting 22:35 22 minutes, 35 seconds that it will go up in the additional cycles. So for a plant to run efficiently effectively uh 60 to 70% is 22:44 22 minutes, 44 seconds definitely um the minimum utilization to get to achieve uh optimum conversion cost and as these capacities go up the 22:52 22 minutes, 52 seconds conversion cost will just go down further. 22:56 22 minutes, 56 seconds Okay. Uh I have another one uh on the from the medium-term perspective. Uh do you see the goulen evolving into a 23:05 23 minutes, 5 seconds speciality ingredients plus bofuel platform rather than a commodity grain processor and uh what what milestones 23:12 23 minutes, 12 seconds should investor track to validate these transitions? 23:18 23 minutes, 18 seconds uh so you see actually our uh traditional business of of sorbital or fructose these are these were all 23:26 23 minutes, 26 seconds specialty chemicals which after few few years became commodities okay any specialtity chemical doesn't last 23:33 23 minutes, 33 seconds for more than 2 to three years because of the competition which eventually comes up you know so initially even sorbital and fructose was specialty 23:42 23 minutes, 42 seconds chemicals after a few years they also became commodities but going forward any new capex which you are constrained to 23:49 23 minutes, 49 seconds do in FI28 will be in the specialty chemical space with more value added products and import substitutes which 23:56 23 minutes, 56 seconds are not being already manufactured in India. So our focus will be to introduce a product which is not being 24:03 24 minutes, 3 seconds manufactured in the country and is only being exported. It will be in the specialy chemical space. 24:10 24 minutes, 10 seconds Okay. Um I think uh your value added starch derivatives portfolio has been expanding right? Uh so what proportion 24:19 24 minutes, 19 seconds of in uh incremental capex has been directed towards speciality versus commodity output. 24:27 24 minutes, 27 seconds Uh so uh going forward it is very uh difficult for me to give these numbers at this time without any kind of a board approval but definitely we will be 24:36 24 minutes, 36 seconds looking at a large project going forward. See our last price in the ethnon segment between Madhya Pradesh and Assam was about 500 crores between 24:44 24 minutes, 44 seconds both the plants which generated a revenue of uh close to 1500 crores. So any new investment will be at least in this capacity or maybe more. 24:55 24 minutes, 55 seconds Okay fine. Thank you. Thank you. 25:00 25 minutes Next question is from the line of Nanisali from systematics PMS. Please go ahead. Hello am. 25:10 25 minutes, 10 seconds Yes. 25:11 25 minutes, 11 seconds Yeah. Thanks for the opportunity. So I wanted to understand on the macro level how do you view uh E20 blending mind 25:20 25 minutes, 20 seconds like we we have almost achieved that and like what are the uh policy makers thinking of increasing it uh because I 25:28 25 minutes, 28 seconds had from some other uh corporate the same that they were planning to increase it to E27. 25:34 25 minutes, 34 seconds So what is the update or anything you are hearing from that front and other one is on right now we have dealing with 25:41 25 minutes, 41 seconds the petrol holes. So what are the plans or on the diesel front like any uh from 25:49 25 minutes, 49 seconds the policy maker side how is it to understand on that front? 25:56 25 minutes, 56 seconds Uh so say uh 20% blending is only the beginning. It is the first milestone which has been achieved by the 26:04 26 minutes, 4 seconds government. It was actually a milestone to touch to actually test the industry 26:11 26 minutes, 11 seconds readiness the uh the system availability 26:17 26 minutes, 17 seconds and the overall uh a overall uh system readiness you know to start blending 20%. that has been achieved very very smoothly in uh much before time. 26:29 26 minutes, 29 seconds Uh government will be will definitely increase the blending uh in the near future. Uh maybe it will start by 2 to 26:38 26 minutes, 38 seconds 3% and eventually see their road map is to follow the road map of Brazil which 26:44 26 minutes, 44 seconds is 55% blending and making ethanol efficient engines. So which is a gradual process it will they're already in touch 26:53 26 minutes, 53 seconds with the automotive industry to start introducing flexi fuel vehicles. So both these things are happening parally 20% 27:01 27 minutes, 1 second is only the first milestone in the ethnol bending program which has been achieved uh in the near future with the current 27:10 27 minutes, 10 seconds engines the government can easily rent about 24 to 25% with the current engines without causing any damage to our 27:18 27 minutes, 18 seconds vehicles. uh any further than that they will need to uh introduce flexi fuel vehicles which they're already uh in 27:25 27 minutes, 25 seconds touch with the auto automobile industry and working on the same. Okay. 27:34 27 minutes, 34 seconds Yeah. Thanks. Thanks for the answer. Thanks a lot for this. 27:40 27 minutes, 40 seconds Thank you. Next question is from the man of Ankur Guladi from January Capital Markets. Please go ahead. 27:50 27 minutes, 50 seconds uh can help me with the grain mix for ethanol in this quarter. 27:58 27 minutes, 58 seconds So say 40% is the mandate of FCI. So we need to use 40% FCI that's a mandate given to us by the government. 28:06 28 minutes, 6 seconds Okay. The balance 60% will be a mix of 45% maze and 15% rice broken rice. 28:15 28 minutes, 15 seconds and any cost benefits of sourcing from FCI. Is there a discount to spot prices or anything like that? 28:22 28 minutes, 22 seconds No, this is a mandate which we have received. There is uh in fact uh we are working on very low AITA margins on uh 28:31 28 minutes, 31 seconds making ethos of FCI rights the we but we enjoy the the kind of grain availability 28:38 28 minutes, 38 seconds which this has created in the uh country. So we are enjoying better margins and balance 60%. 28:48 28 minutes, 48 seconds Okay. All right. Thanks sir. Thank you. 28:54 28 minutes, 54 seconds Next question is from the line of manancha from asset management. Please go ahead. 29:00 29 minutes Hi good afternoon. If we consider only business, what would be the percentage of byproduct that is DDGS in the sales 29:06 29 minutes, 6 seconds mix and does the import of DDGS from USA shall it put a ceiling on DDS prices in the domestic market? Can it be detrimental to margins in any case? 29:19 29 minutes, 19 seconds Uh yeah. So there's a very ballpark figure of whatever uh revenue you see uh which comes from the ethnol there's 29:26 29 minutes, 26 seconds additional revenue of about 25% from the byproduct uh from the byproducts. So there's a uh we have ethnol orders of 29:35 29 minutes, 35 seconds 1200 crores. So we'll get additional revenue of about 300 crores from his byproducts. So there is a ballpark 29:42 29 minutes, 42 seconds calculation of 25% on top of ethnol revenue which comes from the byproducts. 29:49 29 minutes, 49 seconds uh regarding allowing import of made DDGS from US as we see it we only see it as a good news for the ethanol industry. 30:00 30 minutes Uh number one because the import of m DDS in the country will not lessly uh 30:06 30 minutes, 6 seconds will not be less than 26 rupees a kg and the current DDS prices domestic prices 30:13 30 minutes, 13 seconds about 22 to 24 rupees a kg. So which which and secondly the protein content 30:20 30 minutes, 20 seconds and the oil content in Indian DDGS is better 30:26 30 minutes, 26 seconds than what is in the uh US DGS and when a end consumer is buying DDGS the main 30:35 30 minutes, 35 seconds factors which it is looking for is protein and number two is oil. Both these factors are better in Indian DDGS 30:43 30 minutes, 43 seconds as compared to USDGS. Hence we think it is a very good news because it will only and only improve the price realization 30:52 30 minutes, 52 seconds of domestic male DDGS in the country. 30:58 30 minutes, 58 seconds Okay, great. Thank you. 31:05 31 minutes, 5 seconds Next question is from the Aracha from Blue Rock Investments. Please go ahead. Hello. 31:14 31 minutes, 14 seconds Hello. Hear me? Yes, you're audible. 31:17 31 minutes, 17 seconds So, the adjusted EIA per liter in this quarter in ethanol was rupees 9. So, is it sustainable for the future quarters? 31:26 31 minutes, 26 seconds Uh yes, it is very much sustainable. Uh can you explain anything? 31:35 31 minutes, 35 seconds uh as uh we have been saying that there is um uh there is ease off on the raw material prices and which has improved 31:43 31 minutes, 43 seconds the overall margins. So we are expecting uh in the current quarter and coming quarters we are expecting similar kind of EITA margins in the ethnol division. 31:53 31 minutes, 53 seconds Okay. Thank you. 31:57 31 minutes, 57 seconds Thank you. Next followup question is from man of pushkar jin from capital management. Please go ahead. 32:07 32 minutes, 7 seconds Hi ma'am. Uh so I was uh just looking at at one point in FI in March 22 our grain processing division had done a a bit of 32:16 32 minutes, 16 seconds like 80 81 crores. So what uh situations like at at what mh prices should we you 32:23 32 minutes, 23 seconds know again be able to do a similar kind of numbers just uh 32:30 32 minutes, 30 seconds you see because of those figures in FI22 there's over capacity come up in the country for S and S elevators. 32:40 32 minutes, 40 seconds Right. Right. 32:42 32 minutes, 42 seconds Any business does everybody's watching that business. 32:46 32 minutes, 46 seconds Right. Right. And uh yeah and the existing uh existing manufacturers everyone ramped up their capacities 32:53 32 minutes, 53 seconds because at one time star business was rocking it was giving us exceptional margins you know so everyone uh ramped up their capacities as a result of which 33:01 33 minutes, 1 second there has been an over capacity in the country and those margins are look difficult to come back in the current uh in the same products 33:10 33 minutes, 10 seconds right but at that point also I think maze prices were nearby it's just that more capacities have come up is yeah so that is now not linked to maze 33:18 33 minutes, 18 seconds price anymore you know that is linked to now that time these were specialty products which in 3 years had become commodity and they're fighting for 33:25 33 minutes, 25 seconds prices because of over capacity right right but every product has a life cycle you know every product 33:34 33 minutes, 34 seconds right right but as per your understanding how things will evolve in this how do you see our company evolving uh in the next year probably or how how 33:43 33 minutes, 43 seconds things will shape according to you like on the margin for grain prod. So uh sorbital is still doing all right. 33:51 33 minutes, 51 seconds It is still generating a positive eitar. 33:53 33 minutes, 53 seconds It is the starch business which is under pressure. We are uh working backwards in how we can improve the operational efficiency internal efficiencies in the 34:02 34 minutes, 2 seconds s business because the selling prices are not supporting. So all we have to do is of course ramp down the uh production 34:10 34 minutes, 10 seconds plus whatever we are producing we are working on internal efficiencies. We are shifting our boiler to RDF which will hopefully give us some cost saving in 34:19 34 minutes, 19 seconds the carbon and fuel and see how we can optimize our internal efficiencies. So we have to work on that. We are working on that in the current portfolio. 34:29 34 minutes, 29 seconds Right. Thanks. Thank you. 34:34 34 minutes, 34 seconds Next question is from the line of AIT Aisha Gihavan company. Please go ahead. 34:41 34 minutes, 41 seconds Thank you for the opportunity and congratulations for good set of numbers. 34:45 34 minutes, 45 seconds Thank you. Yeah. What is the current uh realization per liter across all ethanol plants? 35:00 35 minutes So see uh we are actually working on uh EIA levels. So uh I mean you can just uh kind of uh calculate it is about 9 to 10 35:09 35 minutes, 9 seconds rupees per liter you know uh on the current um if I just uh see the current level so it is about 9 to 10 rupees per 35:16 35 minutes, 16 seconds liter the realization that is the realization at a level 35:23 35 minutes, 23 seconds okay and madam like uh are you planning to enter into SF sustainable aviation fuel or biodeas specialy chemicals or 2G and all 35:32 35 minutes, 32 seconds see the technology for SAF and 2G mall has yet not been established. It is still under R&D and uh whatever projects have come up 35:40 35 minutes, 40 seconds are all funded by the government. There are no private players which have yet entered it because the technology has yet not been established. So we are also 35:49 35 minutes, 49 seconds meeting and watching the sector and and is there a dedicated leadership account for each different segments three of them? 35:57 35 minutes, 57 seconds Uh internal leadership yes the ethanol and the minerals and the grain processing. I talk about internal management. Yes. Yes. 36:05 36 minutes, 5 seconds Although uh so internally the there is no division of leadership across segments but uh yeah we do uh we do 36:14 36 minutes, 14 seconds supervise uh independent plants from top to bottom uh between the promoters. So it is more like a vertical uh uh you 36:22 36 minutes, 22 seconds know supervision uh which we are uh looking at plants but there is no as such uh division of segments uh between 36:30 36 minutes, 30 seconds the uh internally between the promoters we're all looking at everything together can put some color on like what will 36:37 36 minutes, 37 seconds what will the segment mix the management envisages over the next three to five years. 36:44 36 minutes, 44 seconds So see current uh we will be expanding in the specialtity chemical business going forward uh in uh in next uh 3 to 36:51 36 minutes, 51 seconds four years. So it will be the expansion will come in the grain processing division and then last question like about the 37:00 37 minutes debt position and the blended cost of interest. 37:04 37 minutes, 4 seconds Uh I'll uh I'll request CFO to answer this question. 1 minute. 37:09 37 minutes, 9 seconds Yeah. Just can you repeat the question please? 37:14 37 minutes, 14 seconds Yeah. The net uh rep and the blended cost of interest. 37:19 37 minutes, 19 seconds See presently working capital borrowing we are uh is around 7.5% from three banks which we have we have inducted for 37:27 37 minutes, 27 seconds a working capital requirement and uh uh for I'm talking about December now for the uh for the now for the last two 37:36 37 minutes, 36 seconds months it is being further reduced to 7.25% 25% working capital interest ROI which we have borrowing from the banks 37:45 37 minutes, 45 seconds and the net that equity ratio that equity ratio is around 44.5% or.5%. 37:56 37 minutes, 56 seconds Thank you and all the best for the future. Thank you. Thank you very much sir. 38:00 38 minutes Thank you. Next followup question is from the line of mana from management. Please go ahead. 38:07 38 minutes, 7 seconds Yes. Thank you. So I think there's a lot of good visibility in revenue and eida for the ethnol segment. What a lot of questions are looking for or hoping for 38:15 38 minutes, 15 seconds is any green shoots or any positives in the main division. So if you can explain the same mix broad semic of main division between stars orbital and 38:23 38 minutes, 23 seconds fructose and when we talk about speciality segment for the grain processing division are we looking at some of the fermented products that some 38:31 38 minutes, 31 seconds of the players in grain industry have started something like sodium gluconate. 38:38 38 minutes, 38 seconds uh so given that any product name will not be possible without board approval but we are looking at similar lines so I 38:45 38 minutes, 45 seconds can just uh say that broadly and uh regarding the product mix uh about uh 38:52 38 minutes, 52 seconds 60% of our revenue is coming from sorbital and its byproducts about uh 30% 38:59 38 minutes, 59 seconds comes from starch and 20% comes from fructose okay great thank 39:08 39 minutes, 8 seconds Thank you. Next followup question is from the line of Nishika from Safaya Capital Partners. Please go ahead. 39:17 39 minutes, 17 seconds Yes. Hello. So, uh I just had a classification question. You mentioned that we can sustain the ethanol margins 39:24 39 minutes, 24 seconds the current ethanol margins which are at 17%. So going forward also like for FI27 the whole year in the ethanol segment 39:33 39 minutes, 33 seconds can we see the 17% margin in ethanol segment the ethanol segment 7 includes PLI 39:43 39 minutes, 43 seconds okay the additional PLI which has been received which has been factored in okay okay so just on this call I have I have 39:50 39 minutes, 50 seconds mentioned uh that sustainable margin of 9 to 10 rupees per liter is what we're looking 39:58 39 minutes, 58 seconds which is about I would say 12 to 13%. 40:04 40 minutes, 4 seconds Okay. Okay. Understood. Thank you for the clarification. And another question was you mentioned that we are looking 40:11 40 minutes, 11 seconds for expansion in the grain processing segment. So again if we have less margin in that segment what is our thought 40:19 40 minutes, 19 seconds process behind the expansion in that segment and not the ethanol or the mineral processing segment in which we have better margins. 40:29 40 minutes, 29 seconds No no no we are not expanding the current portfolio. We will be introducing new products in the specialty chemical space. 40:38 40 minutes, 38 seconds This is uh what we are saying. 40:42 40 minutes, 42 seconds Okay. Okay. Okay. that they will get factored in into the grain processing division. We are not looking at increasing the production capacities of 40:50 40 minutes, 50 seconds our current products in the grain processing. We will be introducing new products at a suitable time. 40:57 40 minutes, 57 seconds Okay. Okay. Understood. Thank you so much. 41:02 41 minutes, 2 seconds Thank you. Next followup question is from Madacha. Please go ahead. 41:09 41 minutes, 9 seconds Hi. Sorry. Last question from my side. 41:11 41 minutes, 11 seconds So this is regarding our Q3 numbers. So what we understand is 21.8 crores is something we received from PLA subsidies 41:18 41 minutes, 18 seconds and 5.36 crores is a reversal due to change in accounting treatment for interest subvention. So the net effect of sub subsidy benefit would be around 16.44 cr in our Q3 numbers. 41:29 41 minutes, 29 seconds Correct. Broadly okay. 41:36 41 minutes, 36 seconds Thank you. Next question is from Indivision. Please go ahead. 41:48 41 minutes, 48 seconds Can I request and visualize and proceed with your question? 41:55 41 minutes, 55 seconds Due to no response, we move on to the next participant. Next question is from the line of Nages and Division. Please go ahead and good afternoon. 42:05 42 minutes, 5 seconds Congratulations for a good set of numbers. 42:09 42 minutes, 9 seconds Thank you. I just wanted to know about this 536.9 interest subvention scheme which has 42:16 42 minutes, 16 seconds been reversed. Will it be shown in the fourth quarter? Ma'am, actually we have decided to keep on a um received basis, cash received basis. 42:26 42 minutes, 26 seconds Uh because the ISS has been getting delayed from the uh government side. We have not received ISS for more than one one and a half years. So you know 42:35 42 minutes, 35 seconds factoring in into the P&L was not looking fair to us you know. So then in this quarter we decided to reverse uh the ISIS provision which we had already 42:43 42 minutes, 43 seconds taken for this year and uh we have decided to go ahead with a policy of uh receive basis only. Whatever we receive we will factor in only that. 42:53 42 minutes, 53 seconds So we expect this to be received in this quarter or subsequent years only. 42:58 42 minutes, 58 seconds No yeah we are expecting some part to come in this quarter as well. 43:03 43 minutes, 3 seconds Okay. And one more question is with regard to the FI and DII investments what I understand is the other than in 43:11 43 minutes, 11 seconds the public other than uh promoters public and others not no investments have come from FIS or DIS is there any 43:20 43 minutes, 20 seconds reason for that or uh it's linked to the corporate governance or uh there is no reason for that I don't 43:29 43 minutes, 29 seconds know what to say and what to answer. So there is no reason there is nothing linked to the corporate governance or anything uh which is uh lacking from our 43:36 43 minutes, 36 seconds side because what I feel that if FIS and DI come the share prices may go up further. 43:44 43 minutes, 44 seconds Uh yes uh you're right that will happen and that should happen. I think last few years there was uh because of uh ethanol 43:52 43 minutes, 52 seconds industry being a natal ind nasal industry you know so there were a lot of policies changes which were constantly happening and which is impacting the 43:59 43 minutes, 59 seconds profitability. So but now I'm quite confident that as we are we give on quarter and quarter good results uh we 44:07 44 minutes, 7 seconds should see better movement and better interest in the market in our company. 44:13 44 minutes, 13 seconds So going by this 9 months numbers I hope that uh for full year numbers the EPS will cross 15 rupees or something like 44:21 44 minutes, 21 seconds that. Is it uh reasonable to think over that line? Yes it is. 44:28 44 minutes, 28 seconds Thanks a lot and all the best ma'am. Thank you. Thank you. Thank you. 44:36 44 minutes, 36 seconds Next question is online of Viral Jane from Share India Securities. Please go ahead. 44:46 44 minutes, 46 seconds Uh ma'am just wanted to uh uh your view again on the capex that we are likely to do uh considering the fact that uh the 44:55 44 minutes, 55 seconds situations have now changed uh uh after this uh uh main crisis. So and uh uh the 45:03 45 minutes, 3 seconds geopolitical tensions have changed. So just wanted your view on the same. 45:08 45 minutes, 8 seconds So we are not looking at any fresh capeex in the coming year or FI27. We are looking at giving out good results, 45:16 45 minutes, 16 seconds improving the cash flows and reducing the working capital. Uh any new capeex will come in FI28. But in the meanwhile 45:24 45 minutes, 24 seconds we will take these next few four to five quarters to prepare and to plan for the next uh next phase of growth for the company. 45:36 45 minutes, 36 seconds uh considering the ongoing uh uh facilities what is the optimum uh revenue that we can expect uh uh F27 and F28? Can we have a view on that? 45:49 45 minutes, 49 seconds Uh in F27 uh with the current uh capacities uh we are we should be looking at a revenue of about 2600 45:58 45 minutes, 58 seconds crores to 2,800 crores uh based on the assumption of 85% capacity utilization. 46:06 46 minutes, 6 seconds Okay. Yeah. 46:08 46 minutes, 8 seconds And uh we with the current infrastructure we are capable of generating a revenue of 3,000 crores. So 46:16 46 minutes, 16 seconds we are trying our best how to achieve that. Okay. Thank you. Thanks a lot. 46:24 46 minutes, 24 seconds Thank you. Next followup question is from man Aisha from a har company. Please go ahead. 46:31 46 minutes, 31 seconds Yeah. Thank you for the followup. My question is about what is the tenure and visibility for the incentive like 1.5 liter over MP and 2 liter for us. 46:41 46 minutes, 41 seconds Uh for MP we have received PLI for uh FI 2324 and FI 2425. 46:49 46 minutes, 49 seconds Now uh the PLI for FI 2526 which is the current year is due which will only be 46:55 46 minutes, 55 seconds received in uh say second or third quarter of FI27. 47:01 47 minutes, 1 second As far as PLI for asam is concerned uh that al that is uh there is a lot lot of paperwork which is required for that and 47:10 47 minutes, 10 seconds uh the uh the pre-preparation to get the PLI is very very high in asam. So we are working on that getting all the 47:19 47 minutes, 19 seconds clearances and as soon as that also comes that should also start coming but I'm expecting at least 47:26 47 minutes, 26 seconds at least 6 months before we can start receiving PLA for Assam. In the meanwhile, we are expecting um an 47:34 47 minutes, 34 seconds central incentive from needs which is about 5 cr which we are expecting any time should come to us for 47:41 47 minutes, 41 seconds thank you. Thank you. Thank you. Thank you and all the rest. Thank you. 47:45 47 minutes, 45 seconds Thank you very much ladies and gentlemen. We'll take that as the last question. I'll now hand the conference over to the management for closing comments. 47:54 47 minutes, 54 seconds Uh yeah. Hi. Thanks. Thanks uh everyone for joining this call. I uh thoroughly enjoyed taking the questions. All the 48:01 48 minutes, 1 second questions were valuable and uh uh I enjoyed answering them and uh thanks to to the organizers for putting this group together and putting this call together. 48:12 48 minutes, 12 seconds uh I look forward uh to interacting more and more uh with our shareholders and uh uh uh the interested stakeholders and uh 48:21 48 minutes, 21 seconds we look forward to giving out good results quarter on quarter and maintaining these kind of uh levels um in this quarter as well as the coming 48:29 48 minutes, 29 seconds quarters. Thank you so much and um have a good day everyone. 48:35 48 minutes, 35 seconds Thank you very much on behalf of Gians Limited that concludes this conference. 48:40 48 minutes, 40 seconds Thank you for joining us and you may now disconnect. Thank you. Thank you.