PPAP Automotive Limited — Q3 FY26

PPAP Automotive Ltd Q3 FY2025-26 Earnings Conference Call https://www.youtube.com/watch?v=N_rtcwFmJVQ Published: 2 months ago

0:00 Ladies and gentlemen, good day and welcome to PPAP Automotive Limited's earnings conference call for Q3 and 9 months FI26. 0:11 11 seconds This conference call may contain forward-looking statements about the company which are based on the beliefs, opinions and expectations of the company 0:19 19 seconds as on date of this call. These statements are not the guarantees of future performance and it may involve risk and uncertainties that are 0:27 27 seconds difficult to predict. As a reminder, all participant lines will be in the listenon only mode and there will be an opportunity for you to ask questions 0:36 36 seconds after the presentation concludes. Should you need assistance during this conference call, please signal an operator by pressing star then zero on 0:45 45 seconds your touchstone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Abhishek 0:53 53 seconds Jane, managing director and CEO of PPAP Automotive Limited. Thank you and over to you sir. 1:02 1 minute, 2 seconds Thank you and a very good afternoon to everyone. A very warm welcome to all the participants joining us on today's call. 1:10 1 minute, 10 seconds I am joined by Mr. Sachin Jen our chief financial officer along with strategic growth advisers our IR advisers 1:20 1 minute, 20 seconds our quarter 3 and 9 month financial year 26 financial results along with the investor presentations have been 1:27 1 minute, 27 seconds uploaded on the stock exchanges as well as on our website. We trust you have had the opportunity to review them. 1:36 1 minute, 36 seconds Let me begin today's call by briefly outline outlining a recent strategic transaction successfully completed by the company. 1:45 1 minute, 45 seconds As part of its strategic road map in 2012, PPAP entered into a 50/50 joint venture with Tokai Kogyo Company Limited 1:54 1 minute, 54 seconds Japan to manufacture EPDM based rubber components and TPV glass run channels 2:01 2 minutes, 1 second for the automotive industry primarily catering to Maroti Suzuki and Honda. 2:07 2 minutes, 7 seconds Over the years, the JV established manufacturing operations in greater NOA, Gujarat and Chennai, creating a panindia production footprint. 2:18 2 minutes, 18 seconds Between 2012 and date, PPAP invested an aggregate amount of 48.5 cr rupees in 2:26 2 minutes, 26 seconds the joint venture to support capacity expansion and business development. 2:32 2 minutes, 32 seconds Historically, however, the JV exerted a drag on PPAP's consolidated financial performance. 2:39 2 minutes, 39 seconds Although operating metrics showed improvement in recent periods and the business turned marginally profitable, 2:46 2 minutes, 46 seconds the returns remained materially below expectations and disproportionate to the capital deployed. 2:54 2 minutes, 54 seconds This continued gap between invested capital and returns remained a key concern for the company as well as its stakeholders. 3:03 3 minutes, 3 seconds Accordingly, after a comprehensive evaluation of the long-term strategic alignment with the JV partner and in 3:11 3 minutes, 11 seconds light of PPAP's evolving growth priorities, the board of directors determined that exiting the partnership would be in the best long-term interests of the company and its stakeholders. 3:25 3 minutes, 25 seconds After extensive negotiations and detailed discussions with the JV partner, an agreement was executed on 3:32 3 minutes, 32 seconds 1st of January this year outlining the terms and timelines for completion of the transaction. 3:40 3 minutes, 40 seconds Pursuant to the agreement, all requisite formalities have been duly completed. 3:45 3 minutes, 45 seconds The company has received the full consideration of rupees 100 crores for the sale of its shareholding and 3:53 3 minutes, 53 seconds accordingly the shares held by PPAP have been transferred to the JV partner. 3:59 3 minutes, 59 seconds Further, the nominee directors of PPAP on the board of the JV company have tendered their resignations with effect 4:06 4 minutes, 6 seconds from 13th February 2026 and shall have no liabilities or obligations in respect of the JV company thereafter. 4:16 4 minutes, 16 seconds The proceeds from the stake sale will be judiciously utilized to reduce the company's net debt and to fund strategic capital expenditure initiatives. 4:27 4 minutes, 27 seconds The disciplined allocation of capital is expected to strengthen the balance sheet, enhance financial flexibility and 4:35 4 minutes, 35 seconds further improve the overall financial health of the company. 4:40 4 minutes, 40 seconds The exit significantly enhances PPAP's strategic flexibility and sharpens its ability to pursue independent growth initiatives. 4:51 4 minutes, 51 seconds The company is now better positioned to accelerate expansion and diversify into a broader product portfolio serving a 5:01 5 minutes, 1 second wider customer base across multiple segments and importantly across multiple 5:08 5 minutes, 8 seconds geographies with strong competitive cap capabilities, established technical expertise and robust infrastructure already in place. 5:20 5 minutes, 20 seconds PPAP is well equipped to capitalize on emerging opportunities. 5:25 5 minutes, 25 seconds This strategic move effectively removes constraints and unlocks a wide range of new growth avenues for the company. 5:34 5 minutes, 34 seconds The company's Chennai plant in is already under expansion and will be ready by April of this year. This 5:41 5 minutes, 41 seconds facility will further offer better technological as well as competitive local solutions to its comp customers. 5:50 5 minutes, 50 seconds Going forward, PPAP will remain firmly focused on strengthening its position as a preferred partner in the ceiling 5:58 5 minutes, 58 seconds solutions. The company aims to deepen its present across the mobility sector while selectively expanding into high 6:07 6 minutes, 7 seconds potential industry applications thereby broadening its addressable market and reinforcing its long-term growth trajectory. 6:18 6 minutes, 18 seconds Now coming to the quarterly review. The Indian automobile industry experienced a selective recovery during the third 6:25 6 minutes, 25 seconds quarter driven by festive demand and the release of pent-up demand following GST rate adjustments. 6:33 6 minutes, 33 seconds However, growth remained uneven across OEMs and models. While certain high volume models saw moderation, several 6:42 6 minutes, 42 seconds new launches are still in the ramp up stage and have yet to achieve optimum volumes. 6:48 6 minutes, 48 seconds Against this background, demand variability and the deferment of planned volumes for new models resulted in 6:56 6 minutes, 56 seconds softer than accept anticipated performance in the company's automotive segment during the quarter. 7:04 7 minutes, 4 seconds Encouragingly in the quarter currently underway, we are witnessing a gradual ramp up in volumes which is translating into improved sales momentum. 7:15 7 minutes, 15 seconds The model specific performance variations at OEMs had temporarily impacted our top line despite overall 7:23 7 minutes, 23 seconds industrial stability. But this trend is now showing signs of normalizations in the ongoing quarter. 7:32 7 minutes, 32 seconds Our aftermarket business continues to demonstrate strong structural growth. 7:37 7 minutes, 37 seconds During the quarter under review, our aftermarket business, which is operated under a wholly owned subsidiary called 7:45 7 minutes, 45 seconds LPS Automotives, delivered over 30% year-on-year growth, which was primarily driven by the expansion in the 7:54 7 minutes, 54 seconds distribution network, increase in the product portfolio offered to all the distributors and strong brand visibility. 8:04 8 minutes, 4 seconds This business is steadily improving its contribution and margins and is emerging as a meaningful growth engine, de-risking the group from customercentric risks. 8:15 8 minutes, 15 seconds The commercial tool room business continues to operate at healthy utilization levels. The order pipeline 8:22 8 minutes, 22 seconds remains robust across automotive and non-automotive applications. 8:27 8 minutes, 27 seconds We will be further strengthening financial prudence as well as governance of this business from quarterfall onwards as it will start operating under 8:36 8 minutes, 36 seconds a wholly owned subsidiary of the company called Miaki Precision Tools Limited. 8:44 8 minutes, 44 seconds The industrial product division continues to make steady progress in expanding into non-automotive applications by leveraging our core 8:52 8 minutes, 52 seconds extrusion and injection molding capabilities. 8:56 8 minutes, 56 seconds We are witnessing encouraging traction particularly from export markets and expect this division to scale meaningfully over the coming quarters. 9:06 9 minutes, 6 seconds Its growth will play a key role in diversifying our revenue streams and further de-risking both our customer concentration and geographic exposure. 9:17 9 minutes, 17 seconds Our lithium ion battery pack business which is done under a whole wholly owned subsidiary called Avena Batteries 9:24 9 minutes, 24 seconds Limited is also approaching a turnaround phase. In the final month of the quarter under review, we achieved the highest 9:33 9 minutes, 33 seconds monthly sales in the history of this company. 9:37 9 minutes, 37 seconds After several months of persistent effort and restructuring, the business is now gaining traction. We are 9:45 9 minutes, 45 seconds confident that this momentum will sustain in the current quarter with expectations of achieving record sales 9:52 9 minutes, 52 seconds levels and a significant reduction in operating losses contributed by this division. 10:00 10 minutes Against this backdrop, our consolidated revenue from operations for the quarter 10:05 10 minutes, 5 seconds ended 31st December 2025 stood at 138 crores. 10:14 10 minutes, 14 seconds broadly in line with the corresponding quarter of the previous year. For the 9 months ended December 2025, 10:22 10 minutes, 22 seconds consolidated revenue amounted to 392.47 crores as compared to 406.78 10:30 10 minutes, 30 seconds crores in the previous year reflecting a marginal decline of approximately 3.5%. 10:37 10 minutes, 37 seconds At the consolidated level, the company reported a profit after tax of 6.61 10:43 10 minutes, 43 seconds lakhs for quarter 3 as against a loss in the immediately preceding quarter, indicating gradual operational 10:51 10 minutes, 51 seconds stabilization and improving cost absorption. For the 9-month period, consolidated fat stood at a loss of 225 11:01 11 minutes, 1 second lakhs, reflecting the impact of softer volumes during the earlier part quarter 1 of the year and continued investments in growth initiatives. 11:13 11 minutes, 13 seconds Quarter 4 performance so far has been encouraging and is in line with our expectations. 11:19 11 minutes, 19 seconds We remain confident of achieving our stated revenue guidance with financial year 26 revenues projected at 11:27 11 minutes, 27 seconds approximately 575 crores with an estimated EITA of 58 crores. At the PAT 11:35 11 minutes, 35 seconds level, the company expects to close financial year 26 at with 8 crores of PAT. This estimate excludes the 11:44 11 minutes, 44 seconds extraordinary gain arising from the sale of shares in the JV company which will be accounted for separately. 11:52 11 minutes, 52 seconds Additionally, the company is currently evaluating the potential implications if any of the implementation of the renewed 12:00 12 minutes labor codes. Accordingly, the present guidance does not factor in any potential impact arising from these regulatory changes. 12:10 12 minutes, 10 seconds We remain firmly confident that the strategy strategy initiated 5 years ago is delivering the intended results now 12:19 12 minutes, 19 seconds and is now entering a phase where its full impact will become increasingly visible. 12:27 12 minutes, 27 seconds The structural actions taken over the past few years are expected to significantly strengthen our operating 12:34 12 minutes, 34 seconds performance, enhance financial resilience, and meaningfully derisk the business over the long term. We are 12:42 12 minutes, 42 seconds optimistic about sustained value creation for all our stakeholders and sincerely appreciate the trust, support, 12:51 12 minutes, 51 seconds and most importantly the patience shown by everyone throughout this journey. 12:57 12 minutes, 57 seconds That is all from my side. We will now open the floor for any questions that you may have. Thank you very much. Thank 13:06 13 minutes, 6 seconds you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may please 13:13 13 minutes, 13 seconds press star and one on their touchstone telephone. If you wish to remove yourself from the question queue, you 13:20 13 minutes, 20 seconds may press star and two. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will 13:30 13 minutes, 30 seconds wait for a moment while the question Q assembles. 13:53 13 minutes, 53 seconds The first question is from the line of Raj Ma from Wisdom Index Advisers. Please go ahead. 14:01 14 minutes, 1 second Hi sir, good afternoon and thanks for the opportunity. So sir on our recent transaction of the sale of stake in our 14:08 14 minutes, 8 seconds joint venture can you please give us the color of the rational behind the same and also following the exit from the 14:15 14 minutes, 15 seconds Tokai JV does the company continue to source any technical tooling or process related services from Tokai 14:28 14 minutes, 28 seconds the transition huh behind the transitions. So as I explained to you in my opening address, 14:36 14 minutes, 36 seconds basically there was a misalignment on the long-term strategy with the JV partner. So that was the first uh 14:45 14 minutes, 45 seconds the the first reason why we initiated this stock and over the years the amount of capital that we had invested in this 14:53 14 minutes, 53 seconds company uh 48.5 crores there was almost zero return coming on that capital. So 15:01 15 minutes, 1 second these were the primary two reasons why this uh transaction was initiated and uh for your technical uh sourcing we 15:10 15 minutes, 10 seconds don't we PPAP is completely has been always completely independent and we 15:17 15 minutes, 17 seconds make our own product design our own tools we manufacture them design them everything raw material sourcing all 15:26 15 minutes, 26 seconds those decisions are taken independently by PPAP And that is not for from today onward 15:34 15 minutes, 34 seconds but for the past many many years. So we are a fairly independent company and we have the requisite technical capability 15:42 15 minutes, 42 seconds to cater to all the customer requirements independently by ourselves. 15:48 15 minutes, 48 seconds Okay sir. And sir given our plan to undertake the EPDM rubber business at the Chennai facility. So what is the 15:56 15 minutes, 56 seconds estimated capex requirement for setting up this capability and uh additionally has this capex already been factored into the company's existing capex guidance? 16:08 16 minutes, 8 seconds See the first phase of this capex is roughly around 30 crores which includes the the the building uh also. 16:18 16 minutes, 18 seconds Okay. 16:19 16 minutes, 19 seconds So the building is already uh already ready. I think by April it should get the final touches done. We have already 16:28 16 minutes, 28 seconds uh ordered the machinery for that plant which will again get installed by April and this was all part of our capex plan 16:37 16 minutes, 37 seconds for this year. We had already decided this in the beginning of the year and we started uh expanding into this uh 16:45 16 minutes, 45 seconds category. For your information, this is the second line for EPDM rubber which we have we'll be setting. We already have 16:54 16 minutes, 54 seconds one infrastructure which we had invested about 2 years back already existing in the greater NOA facility which we are 17:02 17 minutes, 2 seconds already using uh to cater to similar products for OEMs. 17:09 17 minutes, 9 seconds Okay. So, understood. Yeah. So, thank you. Thank you sir. 17:17 17 minutes, 17 seconds Ladies and gentlemen, to ask a question, please press star and one. Now participants who wish to ask questions, please press star and one at this time. 17:30 17 minutes, 30 seconds The next question is from the line of Tushar Talwar, an individual investor. Please go ahead. 17:39 17 minutes, 39 seconds Hi. Uh thank you for taking my question. 17:41 17 minutes, 41 seconds I have a few questions but I'll take them one by one. Uh my first question uh sir is on the 100 crores that we've got 17:48 17 minutes, 48 seconds for the sale of the JV shares. Can you please tell us exactly how we intend to apply these proceeds because you know we 17:55 17 minutes, 55 seconds have a significant uh finance cost and u you know a large part of it can be taken care of by these proceeds. So I just want to get a sense of the breakup 18:04 18 minutes, 4 seconds between what we're going to use for debt repayment and what we're going to use for expansion and where. 18:12 18 minutes, 12 seconds So uh basically our target is that uh the long-term 18:19 18 minutes, 19 seconds uh loans that we have in the company it will that will basically uh according to 18:26 18 minutes, 26 seconds whatever the schedule is of repayment those will get repaid over the next two 18:32 18 minutes, 32 seconds two to three years that we are not uh going to not going to repay early whatever part of working capital we are 18:41 18 minutes, 41 seconds utilizing A part of that we will uh reduce still continue to have some working capital 18:48 18 minutes, 48 seconds being used and we keep this money in uh safely with us for doing more of capital 18:56 18 minutes, 56 seconds expenditure which will be planned decided in this uh month of March this year. It will all mostly be for those 19:06 19 minutes, 6 seconds purposes. at a net level you will see uh almost 30% reduction of the interest 19:14 19 minutes, 14 seconds cost because of this uh transaction coming through. 19:18 19 minutes, 18 seconds All right. So thank you that's very helpful. The my second question was uh on our lithium ion uh division. So you 19:26 19 minutes, 26 seconds know I just wanted to get a little bit of color from you that you know what is our competitive advantage here because you know mostly all the batteries are 19:33 19 minutes, 33 seconds being you know the tech the technology or the imports is coming from China. So uh why why have we been uh you know 19:42 19 minutes, 42 seconds involved in this for so long when the competitive intensity is quite high and why do we think that you know this is something that is going to succeed for 19:50 19 minutes, 50 seconds us apart from our you know auto components business which has been you know mature and has been growing for quite some time. 19:59 19 minutes, 59 seconds Yes I think that's a very interesting question to that you've asked. uh we were also thinking quite negatively 20:07 20 minutes, 7 seconds about 6 months back about this business but uh in the last 6 months first of all this industry is now uh going through a 20:16 20 minutes, 16 seconds cleanup phase so lot of uh unorganized players which had come up 20:23 20 minutes, 23 seconds those have already shut shop or those who are had taken up commitments from the customers they are not able to 20:30 20 minutes, 30 seconds fulfill the require required had uh commitments either on the on the delivery side or neither on the quality side. 20:41 20 minutes, 41 seconds So our uh basic uh competitiveness to be to put it very frankly comes from the 20:49 20 minutes, 49 seconds fact that we've been in the automotive business for the past 35 years and uh we 20:56 20 minutes, 56 seconds have a sense of how a stable reliable quality focused product can be made and 21:04 21 minutes, 4 seconds the customers have seen that you know this company is already 5 years old and uh they've not run away from the 21:12 21 minutes, 12 seconds industry. They're still honoring their commitment and we have a very transparent way of working. 21:19 21 minutes, 19 seconds So that's basically our attraction point for all the all the customers who are doing business with us that uh they 21:27 21 minutes, 27 seconds trust us to remain in this business and basically deliver a reliable and uh a quality oriented product for them. 21:37 21 minutes, 37 seconds Now from the business point of view uh right now we are doing uh energy storage 21:45 21 minutes, 45 seconds solution uh products in this company and uh in the past we had we were dealing with some again our customers were also 21:54 21 minutes, 54 seconds very unorganized type of customers but uh last year when we started focusing on 22:00 22 minutes this ESS thing uh that time we are now dealing with some marquee customers like 22:08 22 minutes, 8 seconds uh uh like Philips and Lumines and a few more. So that gives us confidence that 22:15 22 minutes, 15 seconds uh you know this business is now going to become successful and we are seeing the offshoot in the in December. We saw 22:24 22 minutes, 24 seconds whatever trials and uh testing we did in the entire year they resulted in higher sales in December because the actual 22:33 22 minutes, 33 seconds production started in December. Even in January and further this quarter, we are seeing confirmed orders, confirmed 22:40 22 minutes, 40 seconds purchase orders from all these customers which is giving us confidence that this business is now you know whatever worse 22:48 22 minutes, 48 seconds could happen in this business that is already over and now whatever strategy we adopted last year with focus with 22:57 22 minutes, 57 seconds finding good customers having long-term relationships with them that is now becoming fruitful. 23:04 23 minutes, 4 seconds So ESS is going to become one one of the major focus areas in this. And second uh 23:11 23 minutes, 11 seconds I don't know if you know or not that uh there is some regulation being uh coming out that all these e- ras from uh 20 23:21 23 minutes, 21 seconds from April 27 onwards have to get mandatory converted from the lead acid battery to the lithium ion battery. 23:33 23 minutes, 33 seconds And the volume of that of this change is huge. So we have now customers coming to 23:40 23 minutes, 40 seconds us requesting us to make those kind of battery packs for them. So our model is kind of unique. We are doing a very 23:47 23 minutes, 47 seconds transparent kind of uh uh pricing and uh operations with them. 23:56 23 minutes, 56 seconds So I think uh the this uh ESS coupled with this E-ria battery which we are uh 24:04 24 minutes, 4 seconds which we started making this will result in a good business for this company and we'll be able to eliminate most of the 24:11 24 minutes, 11 seconds losses that are that have been there on the balance sheet in the past uh so many quarters. 24:19 24 minutes, 19 seconds Understood sir. Thank you so much. Uh can I take one more question or should I join the queue? 24:27 24 minutes, 27 seconds You can ask one more question. I think it's fine. 24:30 24 minutes, 30 seconds So sir, it's less of a question and more of uh feedback. So sir, I've been following the company for quite some 24:37 24 minutes, 37 seconds time and you know we um keep you know trying different things like there was the Kogai JV there was also this battery division and then there is our core 24:45 24 minutes, 45 seconds segment. I just wanted to understand sir what is your thinking on uh you know capital allocation because what happens is that all of these are you know 24:53 24 minutes, 53 seconds promising segments at some point in time and then you know we face issues with them. Uh what is your thought process on you know when do you when do you as 25:02 25 minutes, 2 seconds management think about pulling the plug on something which hasn't been working for a few years because what happens is that you know we uh you know it tends to 25:10 25 minutes, 10 seconds bleed little little small small amounts of money which tends to add up over time. So you know now that we've got like a 100 cr uh payout from the JV uh 25:19 25 minutes, 19 seconds you know do we have any sense of how we are going to deploy this in the future and whether we have a slightly different strategy from the past where you know we 25:27 25 minutes, 27 seconds are seeding multiple businesses but we possibly maybe and don't take this the wrong way are not thinking about exiting 25:33 25 minutes, 33 seconds them at the right time that was just my larger you know qualitative question here uh I think that's a very fair question to ask uh Mr. 25:44 25 minutes, 44 seconds because uh the kind of financial performance which we've uh we've we've experienced I'm sure a lot of people are 25:51 25 minutes, 51 seconds thinking about about the same thing but uh thank you for your for asking that question very honestly to us and that has been a concern for us as well I mean 26:00 26 minutes let me put it very honestly to you uh that was a concern when we start when we finished our quarter 2 board meeting 26:08 26 minutes, 8 seconds even the whole board of directors were concerned about this question this focus of and uh prudent allocation of capital 26:16 26 minutes, 16 seconds whether you know we are being emotionally attached to the business or we are actually uh running the business 26:22 26 minutes, 22 seconds as it should be be done. So first thing to make it very clear to you is that we are not emotionally attached to any 26:30 26 minutes, 30 seconds business. Business is business end of the day. We have to give it due time to get matured and uh the moment it starts 26:39 26 minutes, 39 seconds and then we have to take a feedback on do we continue with it or do we not continue with it. I think with the JV we 26:48 26 minutes, 48 seconds took uh much more time to come to this realization that maybe you know it 26:55 26 minutes, 55 seconds wasn't u I mean we could have exited the JV earlier than this year but uh I think 27:04 27 minutes, 4 seconds in hindsight you know for the battery division also we were 27:14 27 minutes, 14 seconds thinking about what to financially this business was not doing well but whatever developments now we are seeing from 27:21 27 minutes, 21 seconds quarter 3 onwards we have a different opinion and we are monitoring the situation very closely 27:28 27 minutes, 28 seconds whatever uh things we are seeing I think those things are all positive and we 27:35 27 minutes, 35 seconds don't intend to take any uh decision adverse decision of selling the business or something right now we are going to 27:42 27 minutes, 42 seconds continue with it similarly for the aftermarket industrial product MRAI we are continuously uh checking the nerves of the business. 27:53 27 minutes, 53 seconds So and if in case in future we feel something is going wrong then we will we can take a decision. But as of now I am 28:02 28 minutes, 2 seconds very confident personally that whatever we started the focus on all these five businesses automotive OEM business 28:11 28 minutes, 11 seconds enhancing good technologies there after market industrial product applications the commercial tool room and the battery 28:20 28 minutes, 20 seconds business. I think this is the right direction for the company going forward and this year you will see all these uh 28:28 28 minutes, 28 seconds businesses adding positively uh to the to the company. I am quite confident of that 28:36 28 minutes, 36 seconds but we'll wait in case any quarter or any year goes bad we'll adjust the business accordingly. 28:46 28 minutes, 46 seconds Understood sir. Thank you. Thank you so much for your candid answer. That's all from my friend. Thank you sir. 28:53 28 minutes, 53 seconds The next question is from the line of Vun Aurora from MK Global Financial Services Limited. Please go ahead. 29:02 29 minutes, 2 seconds Hello. Yeah, thank you for the opportunity. So sir uh two questions. So the target if you can give on revenue wise and margin wise for FI27. 29:12 29 minutes, 12 seconds First is this. Second on the capex side if you can tell us that uh in the 9th month of FI26 how much you spent already and what are your plans for FI27? 29:24 29 minutes, 24 seconds These are two questions sir then I'll get right into you. 29:28 29 minutes, 28 seconds Okay, Vunj for financial year 27 uh we are 29:37 29 minutes, 37 seconds uh we are still processing all the uh all the required information and uh in 29:43 29 minutes, 43 seconds March we have our board meeting. So at that time we will uh give all the details about the guidance very clearly 29:52 29 minutes, 52 seconds to you. We'll be very open to it. For uh on the capex side in 9 months we have 30:00 30 minutes done capex of about 37 crores and in the and total capex for this year planned was 55 crores. 30:10 30 minutes, 10 seconds So uh so in this 3 months we'll covering up that capex for next year also uh 30:18 30 minutes, 18 seconds based on the on the in in March we will be able to declare a better situation to you. 30:27 30 minutes, 27 seconds Fair enough sir. So uh uh another question on the robust pipeline of uh this you know order book of 752 kores. 30:34 30 minutes, 34 seconds So basically none is 38 and uh 714 K is none sorry EVs uh 38 and non EVs 714. So 30:43 30 minutes, 43 seconds if you can break it down further this non-EV business you know what's the business article you're getting from the order book and and how much time you'll be able to execute it if I ask this one. 30:54 30 minutes, 54 seconds Thank you. That will be your last question. Thank you. 30:58 30 minutes, 58 seconds Uh so the not uh so this is basically the order book for the automotive uh automotive business. 31:05 31 minutes, 5 seconds And uh the orders are from various various customers like Marauti, Toyota, 31:13 31 minutes, 13 seconds Tata, uh Honda, MG, Hyundai and even from two wheeler uh customers. 31:21 31 minutes, 21 seconds But can you break it down? I mean uh like four-wheer how much you know that autoaner. And one more thing now uh 31:27 31 minutes, 27 seconds since you said two wheelers are you planning to you know you know give some information towards the two wheeler so 31:34 31 minutes, 34 seconds that you know maybe you know you can deal the uh four-wheeler situation right now the four wheeler is doing good and 31:41 31 minutes, 41 seconds the industry wise but what if you know the the things are not not working good so you know you do this you know by increasing in somewhere around for two 31:49 31 minutes, 49 seconds wheelers maybe for the CVS maybe or something else so any plan on that sir and if you can break it and like four wheelers and two wheelers if the order could start. Thank you. 31:59 31 minutes, 59 seconds See first of all for the two wheeler business we already have business with Suzuki motorcycle and uh in this quarter 32:08 32 minutes, 8 seconds also we are developing uh uh some parts for them. I don't have the exact number right now with me but uh we are 32:16 32 minutes, 16 seconds developing lot of parts for them and which will come in the mass production within this uh this year. So that focus 32:23 32 minutes, 23 seconds is there on uh on two-heer through Suzuki motorcycle and uh if you're talking about all the other uh segments 32:33 32 minutes, 33 seconds uh we are now broadly the mandate to given to the team is to focus on uh mobility rather than only automotive. 32:43 32 minutes, 43 seconds We have certain uh business from uh from tractors also and uh commercial vehicles 32:52 32 minutes, 52 seconds uh for the on the EV side not on the non-EV side but uh we are developing parts for for them as well. 33:01 33 minutes, 1 second So the automotive uh the OE business which we talk about I think uh focus there is to expand the customer base as 33:11 33 minutes, 11 seconds well rather than only focusing on the passenger vehicle segment that we have been focusing on right till now 33:19 33 minutes, 19 seconds and uh sorry what was your other question one was the two-heer and the commercial vehicle. 33:26 33 minutes, 26 seconds No, no, the only uh that you know how much they are contributing I mean the order book size the two wheeler how much they're contributing to towards your 33:34 33 minutes, 34 seconds order book size as well as the CVS the two wheeler and the other segments I think would contribute about 5% of the 33:43 33 minutes, 43 seconds of the order book primarily 95% would be again for the passenger vehicle in market 33:52 33 minutes, 52 seconds okay sir so if I may squeeze one more question uh or uh shall I fall you know fall in the queue? 33:58 33 minutes, 58 seconds How can it continue? You can ask. 34:01 34 minutes, 1 second Okay. So lastly uh in the afterm market so how much it is contributing towards your revenue uh in revenue terms. So 34:08 34 minutes, 8 seconds it's if you can give a percentage term and what is the target? I mean yes please. Right now contribution is 5%. 34:17 34 minutes, 17 seconds Okay. But uh we our target is I mean target there's no target to uh in terms 34:26 34 minutes, 26 seconds of percentage contribution to the top line it will contribute 10% but like 34:33 34 minutes, 33 seconds this uh this uh this year we have grown almost by 30%. 34:40 34 minutes, 40 seconds And uh next year also we are expecting this business to grow by by again by 30%. 34:48 34 minutes, 48 seconds So our current like we started this year with an MR of 1.5 34:55 34 minutes, 55 seconds 1.5 crores per month which last quarter we increase to around 2.5 crores 35:03 35 minutes, 3 seconds in this quarter our target is to make it up to 3 crores and next year eventually 35:09 35 minutes, 9 seconds make it up to 5 crores MR kind of situation. 35:16 35 minutes, 16 seconds Okay. Sure. Thank you sir. Thank you sir. 35:18 35 minutes, 18 seconds Continuously we are expanding the product portfolio adding lot of uh spare parts also consumable parts also 35:26 35 minutes, 26 seconds accessories also. So these three areas we are focusing on for growth. 35:37 35 minutes, 37 seconds Thank you sir. 35:40 35 minutes, 40 seconds Ladies and gentlemen to ask a question please press star and one. Now participants who wish to ask questions 35:48 35 minutes, 48 seconds may please press star and one at this time. 35:53 35 minutes, 53 seconds The next question is from the line of SA Desai from DS Securities. Please go ahead. 36:01 36 minutes, 1 second Yeah. Uh thank you for the opportunity. 36:03 36 minutes, 3 seconds Uh I had couple of questions. My fourth question was that uh have you seen any kind of impact on the EPDM rubber 36:11 36 minutes, 11 seconds business due to absence of the turquoise technical support and also just to extend this question 36:19 36 minutes, 19 seconds wanted to understand if we have had any kind of impact of the JV exit on our Japanese OEM business. 36:29 36 minutes, 29 seconds There is no impact as such on the EPDM business per se. Whatever business uh we were doing 36:37 36 minutes, 37 seconds I mean that company is doing the business separately and whatever business we were doing that is continued. We have our own technology we 36:44 36 minutes, 44 seconds have our own material recipes everything is available uh with us and uh we are quite capable of doing that business ourselves. 36:55 36 minutes, 55 seconds Uh your second question was the JV Japanese business right? 37:00 37 minutes Correct. uh impact of JV exit uh I think uh we've already developed 37:08 37 minutes, 8 seconds all the all the technology everything by ourself in over the last few years and 37:15 37 minutes, 15 seconds apart from some short-term loss of business I don't see a long-term impact at all because of this JV not being 37:22 37 minutes, 22 seconds there or because of this uh technical support not coming through 37:29 37 minutes, 29 seconds okay Okay sir. So my second question was that if you could just help us understand what has led to our subute 37:36 37 minutes, 36 seconds performance in Q3 because even though there has been strong revival in the automotive sector our performance is 37:43 37 minutes, 43 seconds submputeed. Is it because of any model specific demand softness? 37:49 37 minutes, 49 seconds It is primarily because of demand softness from a particular OEM or for particular model. 37:57 37 minutes, 57 seconds What we have analyzed like there are certain models in Maruti which were uh supposed to have higher production 38:05 38 minutes, 5 seconds numbers but because of the market they have reduced and because of that our numbers are down because our exposure 38:14 38 minutes, 14 seconds to those models were higher. Similar trend we are seeing in Tata Motors also. 38:20 38 minutes, 20 seconds We're seeing for one model called uh which is curvy. We have a very high number of parts for that model and 38:27 38 minutes, 27 seconds unfortunately the sales of that model are is not coming through. Third major impact what we are having is from the 38:35 38 minutes, 35 seconds Honda. So Honda I'm sure you must be aware that all the models are not uh performing as per the original 38:44 38 minutes, 44 seconds expectations and all these things put together Maruti Tata Honda and even some 38:50 38 minutes, 50 seconds sort of Hyundai this is what is dragging us down. 38:55 38 minutes, 55 seconds we were uh we the we were not present in Mahindra models which have done 39:02 39 minutes, 2 seconds extremely well in the the industry but uh in future we've already 39:09 39 minutes, 9 seconds got inroads in Mahindra and in future whatever models which will come through we will be the preferred suppliers for those models as well. 39:20 39 minutes, 20 seconds It is primarily because of the model wise uh problems that's all. 39:27 39 minutes, 27 seconds Okay. And so sir then the parts and ceiling systems for the newer models that are currently seeing higher demand. 39:35 39 minutes, 35 seconds So do we have capabilities to cater the same? 39:40 39 minutes, 40 seconds Uh we already had installed capacity to achieve those volumes in quarter 3. That 39:47 39 minutes, 47 seconds is why if you see our capacity util utilization is low because that capacity 39:54 39 minutes, 54 seconds is already there in the system. Our manpower cost is also a little bit high which is impacting the EITA only because 40:02 40 minutes, 2 seconds we had to create those uh our uh manpower to cater to those higher 40:10 40 minutes, 10 seconds numbers. Unfortunately, the customers did not uh take those mod those parts. 40:16 40 minutes, 16 seconds But that was already the quarter three story. In quarter four since since 40:24 40 minutes, 24 seconds January we're already seeing uh all these models achieve their uh expected 40:31 40 minutes, 31 seconds forecast of volumes and therefore our utilization of capacity is going up 40:38 40 minutes, 38 seconds and the utilization of whatever human resources extra we had created those are getting utilized. 40:46 40 minutes, 46 seconds Understood sir. Okay. Thank you so much sir. I'll get back in the phone. Thank you. Thank you ma'am. 40:56 40 minutes, 56 seconds As there are no further questions from the participants, I now hand the conference over to Mr. Abhishek Jane for closing comments. Thank you and over to you sir. 41:06 41 minutes, 6 seconds Yeah, thank you very much everyone for joining us today and for your continued engagement. We hope we have been able to address your queries comprehensively. 41:16 41 minutes, 16 seconds Should you require any further information or clarification, please feel free to reach out to us directly or connect with our investor relation 41:25 41 minutes, 25 seconds advisers, strategic growth advisers. We appreciate your continued interest and support. Thank you very much. 41:33 41 minutes, 33 seconds Thank you. 41:34 41 minutes, 34 seconds Thank you, sir. On behalf of PPAP Automotive Limited, that concludes this conference call. Thank you for joining 41:42 41 minutes, 42 seconds us and you may now disconnect your lines. Thank you.