Kross Ltd — Q4 FY26

Kross Ltd Q4 FY2025-26 Earnings Conference Call https://www.youtube.com/watch?v=JEdywgWS7C0 Published: 14 hours ago

0:00 Ladies and gentlemen, good day and welcome to Cross Limited 4Q FY26 earnings conference call hosted by Recurities Securities Private Limited. 0:12 12 seconds As a reminder, all participant lines will be in the business only mode and there will be an opportunity for you to ask questions after the presentation concludes. 0:21 21 seconds Should you need assistance during the conference call, please signal an operator by pressing start then zero on a touchstone phone. Please note that 0:29 29 seconds this conference is being recorded. I now hand conference over to Mr. Mir Hora from Aurious. Thank you and over to you Mr. M. 0:40 40 seconds Uh yeah, thank you. Welcome everyone to the queue for FI26 post results conference call of course with the from the management team we have with us Mr. 0:50 50 seconds Suzai chairman and managing director, Mr. Sumitra, whole time director and Mr. 0:56 56 seconds Kunal my whole time director and CFO. So without taking much of your time uh I will hand over the call to Kunal now. Over to you Kunal. 1:05 1 minute, 5 seconds Hi good afternoon everybody. Thank you for joining us on the earnings call for Cross Limited for the fourth quarter and full year ended March 2026. 1:15 1 minute, 15 seconds Alongside I have with me is Mr. Sumit Ray full-time director other senior team members and also our investors relation 1:23 1 minute, 23 seconds advisor that is captify consulting I'm pleased to report that the company concluded FY26 on a strong note building 1:32 1 minute, 32 seconds on the momentum gained in the second half of the year supported by a favorable macroeconomic environment the 1:40 1 minute, 40 seconds GST rationalization benefits and a robust recovery in the commercial vehicles segment 1:47 1 minute, 47 seconds In spite of a slow H1 in FY26, we were able to register a topline growth of 8.5% in FI26. 1:58 1 minute, 58 seconds H2 of FYI26 revenue marking was a 49.2 increase over our H1 FI26 sales, 2:07 2 minutes, 7 seconds reflecting strong momentum in the latter half of the year. 2:12 2 minutes, 12 seconds On a quarterly basis, Q3 FY26 sales registered a 18.1% year-on-year growth compared to Q3 of FI25. 2:23 2 minutes, 23 seconds And similarly for quarter 4 of FI26, our sales grew 22% in comparison to Q4 of FI25. 2:32 2 minutes, 32 seconds These figures highlight consistent acceleration in the revenue growth across both half and quarters. 2:40 2 minutes, 40 seconds Although the demand has been good, it's overall been a challenging quarter four with the Middle East conflict resulting 2:46 2 minutes, 46 seconds in the shortage of LPG and a substantial increase in commodity prices and consumables. 2:54 2 minutes, 54 seconds However, our business has not been much impacted by the war and the tariff uncertaintities in the US. 3:01 3 minutes, 1 second With this, I hand over the call to Mr. 3:03 3 minutes, 3 seconds Sumit Ray to brief you on the segmental performances and the future outlook of the company. 3:11 3 minutes, 11 seconds Thanks Kunal. 3:14 3 minutes, 14 seconds The auto component sector particularly the tractor commercial vehicle and the trailer segments have witnessed a strong 3:22 3 minutes, 22 seconds recovery in H2 of FI26 and this is continuing in quarter 1 of FI27. 3:31 3 minutes, 31 seconds For the M and SV segment, both EEMs that is Tata Motors and Ashoken have reported 3:38 3 minutes, 38 seconds strong volume growth in quarter 4 and this is continuing in April of 2026. We 3:45 3 minutes, 45 seconds expect this momentum to sustain uh throughout FY27 given their healthy order books and the projections which they have given us. 3:56 3 minutes, 56 seconds The trailer segment uh has also increased um in size dramatically. The volumes have gone up considerably in 4:06 4 minutes, 6 seconds quarter 4 and um we have successfully launched and validated our shipping Zack 4:12 4 minutes, 12 seconds product which has contributed to our sale in quarter 4 and will strengthen 4:19 4 minutes, 19 seconds our position in the trailers ecosystem and will also contribute in FI27. 4:26 4 minutes, 26 seconds The tractor and agri segment. This segment has had a healthy double-digit growth this previous year. 4:34 4 minutes, 34 seconds April 2026 tractor industry data remain encouraging. We remain on track to increase the contribution of the tractor 4:43 4 minutes, 43 seconds segment to approximately 15% of total revenue over the next two years. 4:49 4 minutes, 49 seconds When it comes to exports, this has contributed to 4% of our 4:56 4 minutes, 56 seconds revenue of FI26 and we are confident of increasing our export contribution in the next two years given that we have 5:04 5 minutes, 4 seconds secured orders from European PA1 customers. 5:09 5 minutes, 9 seconds We have made some strategic investments and um uh we have made some strategic 5:16 5 minutes, 16 seconds investments in capacity expansions and new initiatives and these are uh progressing well and poised to support 5:24 5 minutes, 24 seconds in our future growth. Firstly, skipping jacks has been launched uh in Q4 of FI26 5:32 5 minutes, 32 seconds and the initial feedback is very encouraging. We are targeting 300 units by the end of quarter 1 and subsequently 5:41 5 minutes, 41 seconds 500 units in quarter two and in quarter 3. 5:50 5 minutes, 50 seconds The axle the axle beam exclusion plant has also been commissioned and production trials are uh progressing. We 6:00 6 minutes will be um selling these axles in uh this month which is May of 2026. 6:10 6 minutes, 10 seconds The seamless tube facility uh construction is almost complete. 6:16 6 minutes, 16 seconds Foundation work for all the installations is almost ready and uh this project is on track. 6:23 6 minutes, 23 seconds As far as forging capabilities, we have significantly expanded our uh forging capabilities by commissioning a number 6:31 6 minutes, 31 seconds of multiple high tonnage presses which has increased our uh production capacity, efficiency and um this is 6:41 6 minutes, 41 seconds giving us the um higher growth. 6:46 6 minutes, 46 seconds We are also installing a high pressure mold line. This will be operational by September of 2026 6:54 6 minutes, 54 seconds and this will double our existing capacity in casting which will uh help in supporting the trailer axle fail. 7:04 7 minutes, 4 seconds We will also be shortly uh commissioning a new robotic forging facility specifically specifically for rear axle 7:13 7 minutes, 13 seconds shafts. This is a material gathering process and um we will be uh ready to supply 7:22 7 minutes, 22 seconds this these axles uh by September 2026 to our customers. 7:28 7 minutes, 28 seconds Looking towards the future uh the healthy order books and the upward trend in trailer volume sustained tractor 7:35 7 minutes, 35 seconds demand and benefits from our capacity expansion. The company is well poised for a healthy growth in FI27. 7:43 7 minutes, 43 seconds With this, I'd like to hand over the call to Kunal to provide detailed financial performance of Q4 of FI2. 7:55 7 minutes, 55 seconds Uh I'll just take you through our key financial performance uh for the quarter which has passed by and also for the 8:03 8 minutes, 3 seconds full year. For Q4, the revenue stands at 225.4 crores reflecting a growth of 22% 8:11 8 minutes, 11 seconds year-on-year basis. ITA is at 33.6 crores representing a year-on-year growth of 25%. 8:20 8 minutes, 20 seconds The IITa margin for last quarter is at 14.9% up 41 basis points year on year and 168 quarteron quarter. 8:30 8 minutes, 30 seconds PAT is at 22.4 cr reflecting a year-on-year growth of 31%. Whereas the pack margins almost were at 10% which is 69 points year on year. 8:43 8 minutes, 43 seconds In terms of our sales um and segment mix for quarter 4, axles and the suspension business contributed to 45%. 8:53 8 minutes, 53 seconds Whereas the rest of the component business was at 65%. 8:59 8 minutes, 59 seconds For the entire year, our revenue stood at 673.2 cr reflecting a growth of 8.5%. 9:07 9 minutes, 7 seconds ITA margin IITA was at 87.9% representing a growth of 8.2% and ITA margin stood at 13.1%. 9:18 9 minutes, 18 seconds PAT was at 55.2 cr with a PAT margin of 8.2% 9:25 9 minutes, 25 seconds up 46 basis points year on year. If you look into the sales and segment mix for the entire year, the trailer axles and suspension business was at 43%. 9:39 9 minutes, 39 seconds Whereas the rest of the component business is at 57%. 9:43 9 minutes, 43 seconds Uh an important update regarding our IPO proceeds is that the company has has now utilized 100% of the proceeds and they have all been deployed. 9:55 9 minutes, 55 seconds We thank everybody for their continued support and for joining this call. Uh we can now open the floor for uh further query. Thank you. Thank you very much. 10:08 10 minutes, 8 seconds We will now begin the question answer session. Anyone who wishes to ask the question may press star N1 on the touchstone phone. If you wish to remove 10:17 10 minutes, 17 seconds yourselves from the question queue, you may press star and two. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will 10:26 10 minutes, 26 seconds just for a moment cause for the question to assemble. 10:37 10 minutes, 37 seconds We have first question from the line of Mr. Mir from Securities. Please go ahead. 10:45 10 minutes, 45 seconds Yeah. So, so my question was basically on the tractor segment wherein we are currently at 9% of revenues but we have 10:53 10 minutes, 53 seconds a target of around 15% in the next one or two years with tractor segment growth expected to be at a single digit kind of 11:00 11 minutes a growth level. So why are we so positive like what drives the target of around 15%. Is it new customer addition new products? Some light on that. 11:11 11 minutes, 11 seconds Uh thanks M. So there has been uh there are two updates on the tractor uh 11:17 11 minutes, 17 seconds segment. We saw last the last year uh the tractor segment has uh grown substantially. Uh we basically plan to 11:27 11 minutes, 27 seconds increase it to 15% uh by two means that is one by new customer addition and also 11:35 11 minutes, 35 seconds u by uh getting into new products. uh we are working with um three large OEMs in 11:42 11 minutes, 42 seconds the tractor senago which two uh we've been working for the last 15 20 years uh we have now started with the third OEM 11:49 11 minutes, 49 seconds the developments of those components have been uh completed they've been successful and we will be starting our 11:56 11 minutes, 56 seconds uh revenues with them from quarter one onwards and uh also with the existing two customers we have diversified we are 12:05 12 minutes, 5 seconds diversifying our product base even further uh into forings and also shaft components and uh even craft and parts. 12:13 12 minutes, 13 seconds So that is how we plan to uh it's not going to be done in one year but I think by the end of two years we 12:20 12 minutes, 20 seconds should have a better uh contribution coming in from the agree segment. 12:25 12 minutes, 25 seconds Okay. Okay. And uh so my second question is on the export. So with our new extruded line coming into the picture. 12:34 12 minutes, 34 seconds So how uh from when can we see some traction into the trailer axel export as well or trailer excel component export 12:43 12 minutes, 43 seconds something that see we haven't really explored uh this 12:49 12 minutes, 49 seconds market. Um we do plan on exporting our these extruded axle beams or these ext 12:57 12 minutes, 57 seconds the tra the the axles made from these extruded axle beams but we have not really started exploring that side of 13:05 13 minutes, 5 seconds the business. Uh I think uh once this line is completely operational in terms 13:12 13 minutes, 12 seconds of we have we are producing um upward of 5,000 axle beams a month. We 13:21 13 minutes, 21 seconds will be looking into uh export requirements. Okay. 13:26 13 minutes, 26 seconds Because that will involve significant developments because it's not exactly the same product which gets sold 13:33 13 minutes, 33 seconds outside. So uh to make those uh investments in tool and die, we'd first 13:40 13 minutes, 40 seconds like to completely uh operationalize the existing plant with the existing tooling and then invest in new tools. 13:50 13 minutes, 50 seconds Okay. Uh sir and just a follow up on that. So in terms of extruded lines which we have now so here will the tenage uh the like we were into the 13 13:59 13 minutes, 59 seconds to 15 t kind of excels. So will that also increase or that tonnage continues to remain same? 14:06 14 minutes, 6 seconds No. No. Uh the the tonnage uh will be the same. Uh it is more efficient 14:13 14 minutes, 13 seconds uh it is more efficient in terms of the weight of the axle beam. That means a 14:22 14 minutes, 22 seconds lower weight axle beam is able to take a higher tonnage capacity. 14:27 14 minutes, 27 seconds So uh we will be we have u different axles so different axle beams they will 14:35 14 minutes, 35 seconds be um used for the same tonnage I mean okay the end customer the tonnage does not change 14:43 14 minutes, 43 seconds okay okay I'll get back we the highest tonnage axle we have is the 18 ton axle and the lowest is the 12 14:52 14 minutes, 52 seconds t okay I'll get back into Thank you. Thank you. 14:59 14 minutes, 59 seconds We have next question from the line of Ankul Podar from Savan Investment. Please go ahead. 15:06 15 minutes, 6 seconds Hi team, congrats on good set of numbers and also on commissioning of your exision plant as well as the tipping 15:14 15 minutes, 14 seconds jack facility. So my first question is uh uh can you tell me the volumes for the axles for the quarters? 15:23 15 minutes, 23 seconds uh we've done uh roughly above 10 and a half thousand trailer axles but what has 15:31 15 minutes, 31 seconds uh really picked up in the quarter 4 of um uh the FI26 has been on uh air suspension and mechanical suspension. 15:42 15 minutes, 42 seconds We've done upward of three and a half thousand suspensions uh for the entire quarter. 15:49 15 minutes, 49 seconds Okay, understood. 15:52 15 minutes, 52 seconds And uh second is so the cipping jacks has been commissioned but have we uh seen any revenue coming in in Q4 or are we expecting revenues from FI27? 16:04 16 minutes, 4 seconds Yes. uh we we have started seeing revenues but uh uh Ankur what's happening is that there is a a 16:11 16 minutes, 11 seconds validation process when it comes to uh the tipping jacks right we have sold approximately in in quarter 4 we've 16:19 16 minutes, 19 seconds already sold around 75 80 tips okay and in quarter 1 we would be doing approximately 16:28 16 minutes, 28 seconds 150 to 200 um we have already sold we've already sold 300 numbers uh uh for 16:35 16 minutes, 35 seconds for this quarter. So uh right now that the validation we have done we've got um 16:43 16 minutes, 43 seconds uh you know we've got encouraging feedback from the fabricators where we have installed it. So uh revenues have 16:50 16 minutes, 50 seconds started coming in it's very less but it will pick up when we reach to 3 400 kicks a month. 16:58 16 minutes, 58 seconds Okay understood. So the 80 75 80 units that we have sold in this quarter I'm 17:05 17 minutes, 5 seconds assuming that revenue is also part of your uh trailer and trailer business part of the trailer business. 17:13 17 minutes, 13 seconds Yeah. Understood. 17:16 17 minutes, 16 seconds All right. And uh one question is on our seamless tube facility. Can you give us a timeline on when uh we're expecting to 17:24 17 minutes, 24 seconds complete the uh uh like when do we see completion of the facility? 17:33 17 minutes, 33 seconds See the facilities u for the seamless the construction work is completed and uh we have just uh returned back from 17:42 17 minutes, 42 seconds China after coming and inspecting all the equipment. So the first set of equipment is the piercer 17:50 17 minutes, 50 seconds uh that should be dispatched from China by end of May. Okay. The other set of 17:58 17 minutes, 58 seconds equipment that is the furnace that is the rotary heat furnace which is being sourced from Westman that is already undergoing installation. 18:08 18 minutes, 8 seconds So as far as you know by when will the stainless cube get completed? It will get completed around the Q4 of this year as as per our plan. 18:21 18 minutes, 21 seconds Okay, understood. I'll join by the queue. Thank you. Thank you. 18:30 18 minutes, 30 seconds Reminder to all the participants that you may star anyone to ask a question. 18:35 18 minutes, 35 seconds Reminder to all the participants that you may star anyone to ask the question. 18:40 18 minutes, 40 seconds We have next question from the line of Sou Bashra from Mbit AMC. Please go ahead. 18:46 18 minutes, 46 seconds Hi team, congratulations on a strong set of numbers. 18:56 18 minutes, 56 seconds Uh sorry, we can hear you. Okay. Can you can you speak a little louder now? 19:05 19 minutes, 5 seconds Yeah. Yeah. Uh so uh congratulations on a strong set of numbers. Couple of questions. First on the capeex for the year we have done around 100 crores of 19:14 19 minutes, 14 seconds capeex. Broadly if you could explain uh how much of this has gone to the seamless uh facility already and what is our capeex expectation for the next 19:23 19 minutes, 23 seconds year? Uh and second is uh could you give me a bookkeeping question? Could you give me the breakup of revenue between the axel and the suspension business for the year? 19:34 19 minutes, 34 seconds Okay. 19:39 19 minutes, 39 seconds The axle and suspension uh mix is approximately at 7030 19:46 19 minutes, 46 seconds that is we hope to contribute around 70%. I mean that is not specifically for the quarter. It's not that the realization values have uh drastically 19:55 19 minutes, 55 seconds changed but for quarter 4 we will get back to you on the exact uh mixes because we've done more of air 20:04 20 minutes, 4 seconds suspension for the whole year it's for quarter four it's been at around 60% 20:11 20 minutes, 11 seconds of axles and 40% of uh uh uh 60% for% for suspensions and 40% for axles. 20:24 20 minutes, 24 seconds And uh for the capeex uh we'll also tell you what we have planned uh for the month of FI27. 20:33 20 minutes, 33 seconds FI27 would be uh more on the capeex for the seamless tube uh unit. Um uh 20:41 20 minutes, 41 seconds otherwise uh the rest of the infrastructure in terms of capacity expansion on forgings and machining has 20:49 20 minutes, 49 seconds mostly been completed. Uh there will be obviously a maintenance capit that the company would be spending for uh our machining line and the new casting line. 20:59 20 minutes, 59 seconds But um uh if you look into the spend uh for the seamless tube is going to be 21:06 21 minutes, 6 seconds approximately 100 crores uh for FI27 and for the other business it's going to be at around 20 to 25 crores. 21:16 21 minutes, 16 seconds Fair to say we have spent around 60 crores this year on the same right. Yeah. 21:23 21 minutes, 23 seconds Got it. Got it. Secondly one more question if I could squeeze it in. So we had a capacity of uh 5,000 axles a month 21:31 21 minutes, 31 seconds right and now we have expanded that to uh 7,500 axles with the new plant. 21:37 21 minutes, 37 seconds How you plan on uh ramping up the utilization in these plants? Are we expanding distribution? Are we bringing in new uh fabricators who we are selling 21:47 21 minutes, 47 seconds the product to? How is the acceptance of the product? 21:52 21 minutes, 52 seconds Acceptance of the product is is good. Um very honestly yeah sorry the acceptance 22:00 22 minutes of the product is good. Uh very honestly at the moment we are um 22:08 22 minutes, 8 seconds struggling to meet the demand which is being given to us um struggling to uh 22:16 22 minutes, 16 seconds ramp up to meet our peak capacity. So uh but uh this is a temporary hiccup. I mean once we have the extruded plants 22:25 22 minutes, 25 seconds fully operational uh we plan to significantly ramp up our capacity and uh we have the 22:34 22 minutes, 34 seconds distribution across the country in place to do that. I mean we have uh sales 22:41 22 minutes, 41 seconds teams in every state and uh we have tieups with the all the major trailer manufacturers across the country. 22:54 22 minutes, 54 seconds Got it. Understood. I have all that in the queue. Thank you. 23:02 23 minutes, 2 seconds Reminder to all the participants that you press star M1 to ask a question. 23:07 23 minutes, 7 seconds Reminder to all the participants that you that you press star M1 to ask a question. 23:13 23 minutes, 13 seconds We have next question from the line of Ajetti from YouTube Quantum Solutions. Please go ahead. 23:21 23 minutes, 21 seconds Yeah, thank you for the opportunity. As your company has undertaken multiple backward integration initiative, so 23:28 23 minutes, 28 seconds could you help us understand how this initiative are expected to impact margins, costsaving and overall profitability in the upcoming years and 23:37 23 minutes, 37 seconds also what kind of revenue growth should we expect for next two to three years? 23:45 23 minutes, 45 seconds You see margins uh on backward integrations. Let's take the latest one which we have planned out is for the seamless tubes. Okay. So our requirement 23:54 23 minutes, 54 seconds of seamless tubes currently is being on the import route right now and uh when we have our own facility there will be 24:04 24 minutes, 4 seconds an improved margin because our rupee to dollar has you know there's been a lot of erosion. it is not uh in line with 24:12 24 minutes, 12 seconds the steel price increase but since the rupee has gone down um it it just goes 24:19 24 minutes, 19 seconds to show that our margins will be better that is one thing and your second question was on uh uh revenue growth for next year. 24:29 24 minutes, 29 seconds Yeah. So revenue growth uh you know if uh we we have already put forward what our plans are for this year. 24:41 24 minutes, 41 seconds Okay we we have already put plans for a steep increase for this year. Now revenue growth from the seamless unit will start in FI28. 24:53 24 minutes, 53 seconds it it will not be in FI27 that is this year by by the end of this year we will have the plant commissioned and revenue 25:02 25 minutes, 2 seconds growth will take place from FI28 after you know doing whatever uh uh 25:11 25 minutes, 11 seconds in-house consumptions and uh requirements and then we will start uh making tubes for 25:20 25 minutes, 20 seconds for the for the market for the market sizes So uh it is not going to be in this financial year that the seamless cube will contribute towards revenue growth. 25:32 25 minutes, 32 seconds As far as the revenue growth for this year, we have already uh 25:39 25 minutes, 39 seconds taken up a big project of uh enhancing our turnover for this year. 25:47 25 minutes, 47 seconds Could you please quantify the number? 25:51 25 minutes, 51 seconds One minute. It all depends on how the business continues to be doing. You know, you can see our previous quarter 25:59 25 minutes, 59 seconds three, quarter four results. If in quarter four we've been able to increase our revenue by around 22% 26:06 26 minutes, 6 seconds that is what we would be looking at for this financial year as well. So it's obviously subject to uh the demand uh 26:14 26 minutes, 14 seconds being consistent as we've seen in the last 6 months and if that continues uh it's it's being 45 26:21 26 minutes, 21 seconds days into this quarter things have been uh robust. If that continues we should be looking at that growth projected. 26:30 26 minutes, 30 seconds Okay. And so uh we have done around 15% margin this quarter. So it is fair to assume that this 15% in sustainable and 26:40 26 minutes, 40 seconds going forward from this 15% we will increase our margin to for the seamless tube plant as it's got operational 26:49 26 minutes, 49 seconds right. Yeah, the seamless tube plant being operational as as we mentioned will take a little time. Even when it 26:56 26 minutes, 56 seconds starts there will be some time till the margins and all start getting better but uh between 14 uh 14 to 15% margin is 27:06 27 minutes, 6 seconds what we are looking at u for the further quarters as well. uh it's u the quarter 27:14 27 minutes, 14 seconds one we'll have to see in the sense that there has been a lot of um consumable and commodity price hikes. Uh we as 27:23 27 minutes, 23 seconds manufacturers uh working with OEM haven't got this settlement yet. It it's retrospective but it takes approximately 27:31 27 minutes, 31 seconds one quarter for these things to uh take place. So a quarter one or two here or there but uh between 14 to 15% margin is what we're looking at. 27:44 27 minutes, 44 seconds Okay sir. Thank you sir. Thank you. 27:49 27 minutes, 49 seconds We have next question from the line of Nishant Parma from Wealth ECG research. Sir please go ahead. 28:00 28 minutes Yes sir. 28:01 28 minutes, 1 second Thank you sir. said this is Nishant Sharma from Noama with PCB research. Uh first of all congratulations on a great 28:09 28 minutes, 9 seconds set of numbers. Uh just want to understand in terms of margin profile across the two uh segments that you have 28:18 28 minutes, 18 seconds and also what kind of a margins that you expect from tractor as you increase the share of revenue from tractor segment as 28:26 28 minutes, 26 seconds well as exports. So uh will uh is there a material difference in margin for these two uh segments as well? 28:36 28 minutes, 36 seconds So basically if we look into margin one of the product ranges that we have 28:43 28 minutes, 43 seconds for the exports uh that is where the margins are uh the best. If you look into all our product lines, then is 28:50 28 minutes, 50 seconds basically our axles and suspension business and the sitting jack business followed by the component business. So, 28:59 28 minutes, 59 seconds uh increasing uh revenue in terms of or contribution towards u the tractor 29:06 29 minutes, 6 seconds segment is not going to expand any margins. In fact, the tractor segment out of all of these segments are you could say the most competitive when it 29:14 29 minutes, 14 seconds comes to prices, right? Um so uh as I said you know towards margin margin 29:21 29 minutes, 21 seconds expansion the we have done a lot of backward integration already now we are setting up another crafting line which 29:28 29 minutes, 28 seconds will be on by September October uh to help our uh supply chain in terms of break grounds and hubs for axles but the 29:37 29 minutes, 37 seconds extrusion line for the trailers uh when we reach to a decent utilization that will expand our margin and then more of 29:45 29 minutes, 45 seconds expos and uh in a year's time the seamless. 29:50 29 minutes, 50 seconds So extrusion line will also be coming from uh September onwards. 29:54 29 minutes, 54 seconds No extrusion we have already done all the trials uh right now. In fact uh the machining trials for the extruded beam 30:01 30 minutes, 1 second is going on. We should be started we should start selling these axles uh by the end of this month or by June. 30:11 30 minutes, 11 seconds Okay. and uh going forward like uh because I've just started looking at this company uh while we have seen that 30:19 30 minutes, 19 seconds FI24 and FI25 there was more of a flattish kind of a revenue and then we saw a 9% jump this year uh which is I 30:29 30 minutes, 29 seconds believe largely driven by the industry factors but now that we are also expanding capacities 30:35 30 minutes, 35 seconds uh is it fair to assume the kind of 22% growth that we are uh uh indicating 30:42 30 minutes, 42 seconds ating that Q4 we have seen a 22% kind of a growth that's quite sustainable 30:49 30 minutes, 49 seconds uh that that is what we are planning u that is what we are planning the two years which have seen a flat uh trend is 30:58 30 minutes, 58 seconds because uh the industry has been flat and rather degrown in fact in terms of more tonnage in the PV segment volumes 31:08 31 minutes, 8 seconds overall have gone down but for the last six months we've seen support uh tonnage and demand uh going up and if that 31:16 31 minutes, 16 seconds continues so with the new product uh launches that we have and the continued order book uh we should be in a space to 31:24 31 minutes, 24 seconds grow at that space that's and lastly on the CV side while uh you 31:31 31 minutes, 31 seconds sounded pretty conf uh confident in terms of uh demand momentum continuing uh however on the ground uh many are 31:40 31 minutes, 40 seconds believing that this rising uh fuel prices would impact the opex cost for CV 31:46 31 minutes, 46 seconds operators there uh that's the demand may also see some impact on the CV side so 31:53 31 minutes, 53 seconds uh what kind of a comfort that you guys are getting from OEM side uh with respect to their offtake from your side 32:01 32 minutes, 1 second so uh if you look into the volumes which are being produced right now they're upward of 12,000 10,000 trucks by the 32:09 32 minutes, 9 seconds two largest uh CV manufacturer. So, you know, there's been literally no slowdown uh uh from their side yet. Fine. It 32:18 32 minutes, 18 seconds could be probably not at 14 15,000 level to what probably February or March was. 32:24 32 minutes, 24 seconds But uh if you compare it to the quarter one of the previous year, there is a substantial increase in volume. Uh this 32:32 32 minutes, 32 seconds fuel increase might be a temporary hiccup which might be there. But uh as far as uh the demand is there it's u 32:41 32 minutes, 41 seconds still there uh quarter 1 it's still there quarter two in general the CV cycle is not a very very strong u 32:49 32 minutes, 49 seconds quarter for commercial vehicles due to uh monsoons but um we've seen uh a far 32:56 32 minutes, 56 seconds better quarter one in this year as compared to uh the last year. Just stretching a bit on this question uh for 33:04 33 minutes, 4 seconds on a yearly basis if you uh if you you if you have to see your projections which OEMs give will it be a 8 to 10% 33:12 33 minutes, 12 seconds kind of a growth that these guys are giving you or we've recently much better than 8 to 10% kind of 33:22 33 minutes, 22 seconds well uh even OEM uh after a very long time have had two good quarters right so it's not that uh I feel they also want 33:31 33 minutes, 31 seconds to uh you know work ahead but uh we've discussed uh with with OEMs regarding 33:38 33 minutes, 38 seconds their plans for FI27 and um they will surely see a high 33:45 33 minutes, 45 seconds singledigit growth is what uh they are targeting in in volumes uh across um all 33:53 33 minutes, 53 seconds of their segments you know the higher tonnage and also their other tipway 34:00 34 minutes vehicles that depend uh everything put together they're seeing a high singledigit uh 34:07 34 minutes, 7 seconds uh growth. So second half of the year for PV as it is a very strong uh uh H2 but uh this year 34:17 34 minutes, 17 seconds we we're seeing a far better quarter one at least than what quarter one was or last year. 34:23 34 minutes, 23 seconds Sure. I'll call back in queue. Uh I have more questions. Thank you. Thank you. 34:30 34 minutes, 30 seconds We have next question from the line of Akash from NV alpha fund. Please go ahead. 34:37 34 minutes, 37 seconds Yeah. Hi sir. Uh sir uh uh in our previous call I think we had alluded that when with the new tech uh explored 34:44 34 minutes, 44 seconds a coming in um should uh gain market share. So uh in relation to that I just 34:52 34 minutes, 52 seconds wanted to understand uh uh what is the on ground uh uh personal response that we are getting from uh DVMs and uh fabricators and all that. 35:05 35 minutes, 5 seconds We have sold we have uh sold it uh to certain 35:14 35 minutes, 14 seconds fabricators right now but the line has not fully been productionized for us to 35:23 35 minutes, 23 seconds um sort of replace the existing model with 35:29 35 minutes, 29 seconds this new one. So, um, it's a little too early for me to, you 35:36 35 minutes, 36 seconds know, give you this feedback right now, but maybe next quarter we we'll have a feedback to give you. 35:45 35 minutes, 45 seconds Understood. That's it. Thank you. 35:52 35 minutes, 52 seconds Yes. Next question from the line of Sedar Jan from Tawa Ventures. Please go ahead. 36:04 36 minutes, 4 seconds Mr. Sedar is unmuted. Please ask a question. 36:13 36 minutes, 13 seconds We do we do not have any response from the from the line of Mr. Sidhar Jan. We take the next question from the line of Suhamra from MBTMC. 36:24 36 minutes, 24 seconds Please go ahead. 36:27 36 minutes, 27 seconds Hi, uh could you all also speak on what kind of commodity pressure are you all expecting to come in in Q1 particularly 36:35 36 minutes, 35 seconds and uh also for the whole year if you could uh broadly speak on it. 36:41 36 minutes, 41 seconds So uh Shubam um we when we working with OEMs and large uh tier one companies um 36:50 36 minutes, 50 seconds we as manufacturers get compensated uh by them. Now uh there are a couple of increases. The first one being on 36:58 36 minutes, 58 seconds commodities that is tea. Um I mean it's too early because the settlement hasn't taken place but talks are in place for I 37:07 37 minutes, 7 seconds think between 3 to 5 rupees uh per kg uh in terms of uh steel price increase and 37:15 37 minutes, 15 seconds this will be but effect from uh the month of April itself. Uh we don't see this going back to quarter 4. Uh apart 37:24 37 minutes, 24 seconds from that there has been uh we we have given our requests to OEMs for an increase in conversion due to uh price 37:32 37 minutes, 32 seconds hike in u tooling uh a different type different types of oil and uh also due 37:39 37 minutes, 39 seconds to shortage of LPG um gas prices have also uh shot up. So when we work when you work with OEMs or large tier ones 37:48 37 minutes, 48 seconds you have to uh place these papers with them and then whenever there is an industry settlement again as I mentioned 37:55 37 minutes, 55 seconds uh in in the last uh call as well it it we are covered uh for it uh we get it retrospective but the settlement is at 38:04 38 minutes, 4 seconds least delayed by one quarter and for our other businesses uh we for 38:12 38 minutes, 12 seconds like our trailer axle lo suspension business we have already increased our prices um to the market which is being followed by other manufacturers as well. 38:25 38 minutes, 25 seconds Got it. Got it. So uh would it be fair to assume that uh the trailer axle and suspension business uh we have kind of 38:33 38 minutes, 33 seconds passed uh pass out a major part of the increase but uh the OEM uh Q4 price hike 38:41 38 minutes, 41 seconds uh the commodity run up that we saw we'll not get a pass through for that since you said that the price hike in steel also will be effective come April 38:47 38 minutes, 47 seconds right so we should see a margin pressure in Q1 again uh this yes that is what we feel 38:56 38 minutes, 56 seconds from from the dialogue with the OEMs and the mills is what is currently being discussed because uh you know these 39:04 39 minutes, 4 seconds shortages mostly have come in from the latter half of March actually you know which is the end of quarter 4. So we 39:12 39 minutes, 12 seconds don't we feel that it's not really going to come in from quarter 4. It's going to happen more a settlement will happen with quarter 1 onwards. And in our 39:20 39 minutes, 20 seconds excellent suspension business we have we there is no uh scope of you know getting anything retrospective. So um this is 39:28 39 minutes, 28 seconds something which has to be implemented um uh from day one. So that we've already passed uh on the price hike to the fabricators. 39:38 39 minutes, 38 seconds How much of a price have we taken? It depends. Uh it's approximately five 5%. 39:45 39 minutes, 45 seconds Uh till the time there is settlement and we know uh if if the settlement is further then we will increase it further 39:52 39 minutes, 52 seconds or subsequently reduce it but um uh I think the impact is we we get 40:00 40 minutes compensated by it right uh Sham. So our quarter uh does not uh have a very very large impact. We we do manage that much. 40:13 40 minutes, 13 seconds Okay. Thank you. And it it happens almost every uh quarter or if not quarter once in every 6 months. This this trend obviously happens. 40:23 40 minutes, 23 seconds In the last year also there the industry has seen some reduction in commodity prices. So the these things keep 40:31 40 minutes, 31 seconds happening. It's just that it's a little larger for this one. Got it. Got it. Thank you. 40:37 40 minutes, 37 seconds Thank you. We have next question from the line of Vir from Securities. Please 40:44 40 minutes, 44 seconds go ahead. Uh yeah. So s just a follow up on this part in terms of the RM cost 40:51 40 minutes, 51 seconds movement and all. So basically currently are we also facing any supply chain issues or the supply chain issues are 40:58 40 minutes, 58 seconds sorted and our production is sort of seamless right now? 41:03 41 minutes, 3 seconds Well may it's not seamless. uh but also it's not been a very big hindrance in 41:10 41 minutes, 10 seconds the sense that if you look into steel steel availability is there with the mills but uh you know as far as what 41:19 41 minutes, 19 seconds stocks they maintain and everything uh that that is uh not as how it used to be 41:25 41 minutes, 25 seconds earlier you know they if for example you want to roll a thousand tons uh for a specific gradient size what they are 41:33 41 minutes, 33 seconds following is approximately 5060 60% of that only. Apart from that the gas we feel that it has improved um during the 41:43 41 minutes, 43 seconds during uh the shortage when we it was there we had to change our furnaces. Uh so we've done that so that there's not 41:51 41 minutes, 51 seconds 100% dependent only on LPG it's it's on other resources as well. So uh let's see 42:00 42 minutes we have to wait and watch uh as to what happens uh a little later on. 42:07 42 minutes, 7 seconds I just want to add on this you know you could just see what happened with LPG. 42:11 42 minutes, 11 seconds We are very dependent on LPG and furnace soils and the LDOS's uh to fire up the 42:18 42 minutes, 18 seconds furnaces because that's a big part of our heat treatment is a very big part. 42:23 42 minutes, 23 seconds But nevertheless we were able to you know increase our turnover year on year 42:30 42 minutes, 30 seconds quarter on quarter. Uh we could not have done it without uh if there was hindrance which was you know disturbing 42:38 42 minutes, 38 seconds our supply chain. So of course there is a a matter of a little bit of margin but 42:45 42 minutes, 45 seconds nevertheless we were able to uh weather this storm of LPG uh with our resources. 42:54 42 minutes, 54 seconds Okay. Okay. And does the 5% price hike into the trailer accent segment suffice or you need to take some more to cover 43:02 43 minutes, 2 seconds the R& if I have to ask you and you give me it is so easy. You know these are market conditions. There is a competitor you 43:11 43 minutes, 11 seconds know and we can't go over the competitor. No he's uh we are number two player. So we 43:18 43 minutes, 18 seconds can't price our product uh more than the number one player. Okay. 43:22 43 minutes, 22 seconds So it these there are certain things which are market driven and final pricing of these type of products are 43:30 43 minutes, 30 seconds market driven. So if we have our way we would love to increase it further but uh 43:36 43 minutes, 36 seconds things have to be uh have to be sold also. 43:41 43 minutes, 41 seconds We have to take a balance at how much the competitor has increased increased by 4%. Okay we can maximum go to 5%. 43:50 43 minutes, 50 seconds Right. We we can't go beyond that. Yeah. Yeah. 43:55 43 minutes, 55 seconds Uh sir just uh one more thing is more of a broader view question here that see now across uh we are hearing the rail 44:03 44 minutes, 3 seconds freight corridor being built up across states and you know it is picking up now. So when we talk to this uh you know 44:11 44 minutes, 11 seconds fleet operators or the fabricators who you know make these trailers and all sort of stuff. So what is an overall view in the market right now that how 44:20 44 minutes, 20 seconds will the rail freight corridor impact the CV industry? Will it impact the trailers more or some view on that sense? 44:28 44 minutes, 28 seconds See, I'll tell you uh forget the railway railroad carrier or no this freight freight carrier 44:37 44 minutes, 37 seconds you you look at it there is the train which goes from Jamshur to Chennai every day. Okay. Yeah. How 44:47 44 minutes, 47 seconds much of a consignment are we booking on that train? 44:52 44 minutes, 52 seconds You know we we we it's it's zero because the cost of transportation by 44:58 44 minutes, 58 seconds the receipted transportation is 3 rupees a kg and when we have to do the uh 45:08 45 minutes, 8 seconds dispatch by train it cost us over 18 rupees that is six times the receipted cost. The rest goes into brokerages. 45:18 45 minutes, 18 seconds So I'll give you also uh we we uh we we don't fear about the freight corridor 45:26 45 minutes, 26 seconds because it's going to be run by the railways and in in countries like say India most of 45:36 45 minutes, 36 seconds the goods you you look at how the bus industries has been growing right why the trains are also running they have 45:45 45 minutes, 45 seconds started so many trains But why is it that Tata Motors and Ashokand year on year are increasing their bus range? 45:55 45 minutes, 55 seconds Ashokeand has increased their bus production by 22%. 46:00 46 minutes For this financial year, it it's not that the trains have stopped running. 46:06 46 minutes, 6 seconds The freight corridor is important to transport goods from port to certain destinations and certain commodities 46:14 46 minutes, 14 seconds like maybe stone, oil, gas, all those commodities 46:21 46 minutes, 21 seconds but not really goods which are manufactured from uh 46:27 46 minutes, 27 seconds from from say components, parts uh even even uh uh food talk it it's not going 46:36 46 minutes, 36 seconds to be used for that. And just one minute there's Sumit would like to add on something on the freight corridor. 46:45 46 minutes, 45 seconds Yeah. Um so basically it's very honestly difficult to say right now how much of 46:53 46 minutes, 53 seconds an impact it'll have but uh uh the thing is that 46:59 46 minutes, 59 seconds uh transportation by trailers there is a wide range of um material 47:07 47 minutes, 7 seconds that is transported via trailers from coals which are mined to coal which 47:14 47 minutes, 14 seconds is mined to iron ore to um 47:19 47 minutes, 19 seconds to steel to uh cars to bikes to uh FMCG 47:26 47 minutes, 26 seconds goods to uh road building materials. So uh the freight corridor is going to 47:35 47 minutes, 35 seconds uh if it takes up it will take up a portion of a portion of the trailer industry. So it's it's not like it's 47:44 47 minutes, 44 seconds going to be uh uh taking up a a a wide chunk out of the entire trailer 47:51 47 minutes, 51 seconds industry. U maybe it will impact more on the uh rigid body vehicles which uh 48:01 48 minutes, 1 second transport uh smaller I mean um uh which which transport smaller goods you know. 48:10 48 minutes, 10 seconds Uh but uh uh as far as the trailers go uh it's it's going to take up you know a 48:18 48 minutes, 18 seconds smaller percentage right that's what we feel right now at least. Okay. Okay. 48:25 48 minutes, 25 seconds All right. 48:28 48 minutes, 28 seconds As there are no further questions from the participants. I now hand the conf conference over to management for closing comments. 48:42 48 minutes, 42 seconds Hi uh we thank everybody for joining and participating uh in the call. Uh we are excited about the opportunities ahead. 48:52 48 minutes, 52 seconds Uh we remain committed to delivering sustainable and profitable grow and for any further queries please reach out to 49:00 49 minutes our IR team uh that is to captify consulting. Thank you once again 49:08 49 minutes, 8 seconds ladies and gentlemen on behalf of securities pers that conclude this conference. Thank you for joining us and 49:16 49 minutes, 16 seconds you disconnect. Thank