Raymond Ltd — Q4 FY26

Raymond Ltd Q4 FY2025-26 Earnings Conference Call https://www.youtube.com/watch?v=Ic7MwTSRvi8 Published: 8 days ago

0:03 3 seconds Ladies and gentlemen, good day and welcome to Raymond Limited Q4 FI26 and FI26 earnings conference call hosted by Anandi. 0:13 13 seconds As a reminder, all participant lines will be in the listen only mode and there will be an opportunity for you to ask questions after the presentation concludes. 0:22 22 seconds Should you need assistance during this conference call, please signal an operator by pressing star then zero on your touchstone phone. Please note that this conference is being recorded. 0:34 34 seconds I now have the conference for Mr. Manisha from Anandi. Thank you and over you sir. 0:42 42 seconds Thank you. Uh on behalf of Anandi, I would like to welcome all the participants in the Q4 FI26 and FI26 0:50 50 seconds conference call of Raymond Limited. We have with us from the senior management of Raymond Limited, Mr. Rakkesh Diwali, 0:57 57 seconds group CFO, Mr. Goautami, MD engineering business, Mr. Sanjep Sharma, joint MD 1:04 1 minute, 4 seconds and CEO JKMPTL, Mr. Naven Sharma, CFO engineering business and Mr. Suna, head investor 1:12 1 minute, 12 seconds relations. Without taking further time, I would like to hand over the call to Mr. Goautami. Over to you, Mr. Go. Thank you. 1:21 1 minute, 21 seconds Good evening everyone. Thank you for joining us today for our Q4 FY26 and FYI u uh Q4 results as well as the FY26 1:30 1 minute, 30 seconds results conference call. I hope everyone has had an opportunity to go through our financial results and investor presentations which have been uploaded 1:38 1 minute, 38 seconds on the stock exchanges as well as on the company's website. Moving ahead, let me start by talking about the broader macroeconomic landscape that has 1:46 1 minute, 46 seconds influenced our performance and strategic decisions. 1:50 1 minute, 50 seconds India concluded FI26 with a robust real GDP expansion of 7.6% underpinned by a significant base year 1:59 1 minute, 59 seconds division and resilient industrial activity. While the manufacturing sector remained in expansary territory throughout the year, the manufacturing 2:07 2 minutes, 7 seconds PMI moderated to 53.9 in March which was a 45month low reflecting the impact of 2:14 2 minutes, 14 seconds energy shocks and the rising input costs from Middle Eastern conflicts. Despite this late quarter cooling, the fiscal 2:21 2 minutes, 21 seconds year benefited from structural GST2 reforms and the RBI's managed policy rate of 5.25% 2:28 2 minutes, 28 seconds which helped contain March CPI inflation at 3.4% and supported overall domestic demand. 2:36 2 minutes, 36 seconds If you look at the automotive industry, it hit a historic milestone in FI26 with domestic passenger vehicle which is the 2:43 2 minutes, 43 seconds PV sales reaching a record 4.64 million units. a 7.9 yearon-year percent 2:50 2 minutes, 50 seconds year-on-year increase. Q4 momentum was particularly strong with volumes climbing to 13.2% to 1.32 million units 2:59 2 minutes, 59 seconds driven by a structural shift towards utility vehicles which now dominate the market. Total industry dispatches 3:06 3 minutes, 6 seconds including two wheelers which was 21.71 million and commercial vehicles 1.08 08 million reached a combined 7-year peak. 3:15 3 minutes, 15 seconds Complementing domestic strength, exports struck the record of 911 million units, which was 17.5% plus, reinforcing 3:24 3 minutes, 24 seconds India's role at the critical global manufacturing node. 3:29 3 minutes, 29 seconds Looking at the aviation sector, it has maintained significant momentum in FI26 with global OEMs like uh global OEMs 3:38 3 minutes, 38 seconds tripling India sourcing compared to 2019 levels to reach 1.5 billion annually. This expansion is 3:47 3 minutes, 47 seconds fueled by the deepening of tier one manufacturing roles for Indian firms and a global airline transition towards fuel efficient next generation fleets 3:56 3 minutes, 56 seconds offering 25% gains in fuel burn efficiency. 4:00 4 minutes Despite a record backlog of 17,000 commercial aircraft representing over a decade of revenue visibility, actual 4:07 4 minutes, 7 seconds conversion remained hampered by engine shortages and supply chain friction. 4:12 4 minutes, 12 seconds Q4 was specifically impacted by a contraction in aerospace grade titanium and aluminium alloys following logistic blockades in the Gulf. These persistent 4:22 4 minutes, 22 seconds inflationary pressures have accelerated a strategic pivot towards domestic input localization to insulate margins from geopolitical activity. 4:31 4 minutes, 31 seconds The aerospace component ecosystem remains highly resilient due to extreme barriers to entry. 4:38 4 minutes, 38 seconds Suppliers who have cleared rigorous certification hurdles are protected by a compliance mode that insulates them from 4:45 4 minutes, 45 seconds lowcost competition for the component and hardware ecosystem. This record high order book provides unparalleled 4:53 4 minutes, 53 seconds long-term revenue stability provided that domestic localization can successfully mitigate ongoing material cost premiums. 5:02 5 minutes, 2 seconds Raven Limited on its consolidated performance continued its growth momentum delivered a resilient quarterly performance reporting a total income of 5:10 5 minutes, 10 seconds 613 crores reflecting a 2% increase compared to the same quarter of the previous financial year. IDIA stood at 5:18 5 minutes, 18 seconds 85 crores with an IIDA margin of 13.9% in Q4 FI26 versus total income of 601 5:25 5 minutes, 25 seconds crores in Q4 of FI25 delivering an IIDA of 99 crores with an IIDA margin of 16.4% in Q4 of FI25. 5:36 5 minutes, 36 seconds Q4 SI26 performance was anchored by the aerospace, defense and precision technology divisions reflecting the structural integration of Indian 5:44 5 minutes, 44 seconds suppliers into global high-tech value chains. We are observing a significant migration of domestic vendors from basic 5:51 5 minutes, 51 seconds component manufacturing towards high complexity subsystems and precision engineered assemblies. This transition 5:58 5 minutes, 58 seconds has secured a robust multi-year order pipeline for tier 1 and tier 2 export partners, enhancing both revenue 6:05 6 minutes, 5 seconds visibility and contract stickiness amid broader global supply chain regal alignments. 6:13 6 minutes, 13 seconds During FI26, total income stood at 2312 crores, a 10% year-on-year growth from 2,15 crores in FI25. 6:24 6 minutes, 24 seconds IDA stood at was flat at 335 crores in FI26 compared to the same number 335 crores in FY25. 6:34 6 minutes, 34 seconds The IBIDA margin stood at 14.5% in FI26 versus 15.9% in FY25. 6:42 6 minutes, 42 seconds While operational performance remains strong, ITA margins face pressure due to a reduction in nonoperating income. uh 6:50 6 minutes, 50 seconds 600 crores of cash was transferred to Raymond reality post the de merger hence the difference going forward we continue 6:57 6 minutes, 57 seconds to remain optimistic about the future growth trajectory given our expansion strategy in new product categories and new geographic 7:06 7 minutes, 6 seconds I'd like to move on to the segmental performance to give more clarity on the operations so we look at the aerospace business first which is through the 7:13 7 minutes, 13 seconds company JKE global aerospace limited at the segment level the aerospace and defense business reported robust 7:20 7 minutes, 20 seconds performance with revenue of 119 crores which is 11% year-on-year growth and an IPA of 3 crores which is again 11% 7:29 7 minutes, 29 seconds year-on-year growth uh and an IITA margin of 25.5% in Q4 of FI26 versus a 7:37 7 minutes, 37 seconds revenue of 107 crores and an IIDA margin of 27 crores and an IITA percentage of 7:43 7 minutes, 43 seconds 25.5% in Q4 of FI25 in FI26 six full year this segment 7:49 7 minutes, 49 seconds generated 392 crores in revenue which is a 26% year-on-year growth from 311 crores in FI25. 7:57 7 minutes, 57 seconds Ibida also grew by 25% year-on-year reaching 88 crores compared to 70 crores 8:03 8 minutes, 3 seconds in FI25. The IBIDA margin stood at 22.3% in FI26 versus 22.4% in FI25. 8:13 8 minutes, 13 seconds Q4 FI26 performance was driven by a dual strategy of portfolio expansion and increased volume allocations from core 8:21 8 minutes, 21 seconds OEM and T1 partners. Forward looking indicators remain robust characterized by a steady rise in the RFQ activity 8:29 8 minutes, 29 seconds which is request for quotation and the pursuit of new global strategic ventures. This healthy demand supports 8:36 8 minutes, 36 seconds continued capacity scaling and deeper integration into the high-tech supply chain. 8:42 8 minutes, 42 seconds While internal growth indicators remain strong, the near-term outlook is currently influenced by external macroeconomic factors. 8:50 8 minutes, 50 seconds Precision technology and auto components which is the JK mining precision technology uh company is at this segment 8:58 8 minutes, 58 seconds level. This uh physician technology and auto components company reported a revenue of 442 crores which is a 5% 9:08 9 minutes, 8 seconds growth and an IIDA margin of 67 crores which is a 26% year-on-year growth and 9:14 9 minutes, 14 seconds an IIDA margin of 15.2% 2% in Q4 of FY26 versus a revenue of 421 crores, an IBIDA 9:22 9 minutes, 22 seconds of 753 crores and an IIDA margin of 12.7% in Q4 of FI25. 9:30 9 minutes, 30 seconds In the full year of FI26, this segment generated 1667 crores in revenue, which is a 10% year-on-year growth from 1513 9:39 9 minutes, 39 seconds crores in FI25. Ibida also grew by 34% yearonear reaching 223 crores compared 9:46 9 minutes, 46 seconds to 167 crores in FI25. The IBIDA margin stood at 13.4% in FI26 versus 11% in FI25. 9:57 9 minutes, 57 seconds The IBIDA margin improvement was also on account of higher sales volumes, favorable product mix, but also included 10:05 10 minutes, 5 seconds a one-time gain of 13 cr from the sale of land in Q2 of FY26. 10:11 10 minutes, 11 seconds We continue with our strategy to expand into new international geographies and industrial sectors. We are observing business momentum across domestic and 10:19 10 minutes, 19 seconds international markets supported by the China plus one strategy. Integration synergies and focused operational efficiencies across all segments. 10:28 10 minutes, 28 seconds However, global trade pressures stemming from US tariffs have introduced logistical complexities resulting in some temporary rescheduling and delays across the industry. 10:39 10 minutes, 39 seconds Let us come and look at the debt and cash position at Raymond Limited. We continue to rem remain a debt-free business with net cash surplus of 68 10:48 10 minutes, 48 seconds crores in March 2026. Raymond is embarking on a transformative 930 cr 10:55 10 minutes, 55 seconds capital expenditure program over the next 5 years to meet surging international demand. This includes 500 11:02 11 minutes, 2 seconds crores dedicated to aerospace projected to scale current capacity significantly and 430 crores for precision technology 11:10 11 minutes, 10 seconds and auto components. The integration of advanced multiaxis machining systems is already enhancing the turnaround times 11:20 11 minutes, 20 seconds and enabling the execution of complex high-v value projects in aerero engine, landing gear and structural segments. 11:27 11 minutes, 27 seconds Our operational reputation is reinforced by consistent fair what is typically called new product development approvals 11:34 11 minutes, 34 seconds and successful audit outcomes accelerating the conversion of RFQS into multi-year contracts. We are 11:41 11 minutes, 41 seconds strategically pivoting beyond build to bridge services towards core design and value engineering collaborations with global OEMs. This shift into 11:50 11 minutes, 50 seconds sophisticated sub subsystem manufacturing deepens our integration into the global supply chain and enhances long-term contract stickiness. 12:00 12 minutes As global OEMs increasingly look to India for supply chain diversification, Raymond Engineering's business is uniquely positioned to capitalize on 12:08 12 minutes, 8 seconds this structural tailwind with a record RSQ pipeline, robust operational readiness, a clear focus on high 12:15 12 minutes, 15 seconds precision innovation. We remain committed to scaling exports and reinforcing our status as a to trusted 12:22 12 minutes, 22 seconds global manufacturing hub. I'd like to thank you all once again for your continued interest in Raymond. We are now happy to take your questions. 12:31 12 minutes, 31 seconds Thank you very much. We'll now begin with the question and answer session. 12:36 12 minutes, 36 seconds Anyone who wishes to ask a question may press RN1 to ask a question. 12:42 12 minutes, 42 seconds Anyone you may press RN1 to ask question. 12:53 12 minutes, 53 seconds The first question is from Bal Subraman from Marian Capital. Please go ahead. 13:00 13 minutes Good evening sir. Thank you so much for your opportunity and sir in that aerospace. 13:04 13 minutes, 4 seconds Sorry to interrupt but your audio is not clear. Right now it's clear sir. Yes. Go ahead. 13:10 13 minutes, 10 seconds Yeah. Uh good evening sir. Thank you so much for the opportunity. In that aerospace side, we have added 100 plus new SQUs in this year and what is the 13:19 13 minutes, 19 seconds R&D expense uh uh in this financial year and are these development costs are contractually uh re reimbursable by the customers. 13:30 13 minutes, 30 seconds So basically uh uh it's a mixed question but let me uh try and answer that most of the R&D costs are written off as 13:39 13 minutes, 39 seconds operational costs. It's between 3 to 5% of your cost but we write it off in the same year because we considering it as 13:46 13 minutes, 46 seconds part of our business model to grow aggressively. Uh in some cases where the projects are very complex you can get 13:54 13 minutes, 54 seconds some development cost but in a lot of cases it is included uh in the prices that you quote and therefore you build 14:01 14 minutes, 1 second them into your price. But uh the clear answer is that we do not separately record these costs and we write them off in the same year like operational costs. 14:12 14 minutes, 12 seconds So in a way the more products you develop the more you write off that particular year. 14:19 14 minutes, 19 seconds Sir out of our current order book uh like we could share the breakup between lead programs GTF and other platforms. 14:29 14 minutes, 29 seconds Well, I I don't think we go to the extent of sharing exactly on all platforms, but I just want to tell you that we are basically present on several 14:37 14 minutes, 37 seconds platforms across all the possible engine OEMs globally both in Europe and US and we are significantly looking to 14:46 14 minutes, 46 seconds continuously increase our market share with them. uh and therefore our goal is to be derisked that whichever whether 14:54 14 minutes, 54 seconds it's a narrow body aisle aircraft or a widebody aircraft or whether it's in Europe or whether it's in US uh we are 15:01 15 minutes, 1 second part of those markets and we have derised ourselves to make sure that we uh are part of most of these programs. 15:09 15 minutes, 9 seconds Yes sir. Uh sir on the tax side I think it's been reduced from uh month onwards. How do you look at from June onwards? 15:18 15 minutes, 18 seconds Sorry, can you repeat tax impact has been reduced uh from fourth month onwards? 15:26 15 minutes, 26 seconds So it's a mid of the quarter. So how do you look at from Q1 onwards? 15:36 15 minutes, 36 seconds So so so are you asking this question for aerospace or automotive? So just to clarify in aerospace there were no tariffs and in automotive the tariffs 15:45 15 minutes, 45 seconds are definitely down to 18% now. So it's definitely better than what it was and I think slowly customers are getting used 15:52 15 minutes, 52 seconds to the new normal and therefore slowly business will start coming back and is coming back. Uh it's taken some time but 16:01 16 minutes, 1 second u but uh I think it will only get better. However, in the meantime because of the war you had disruptions on supply chains etc. So it will just be a little 16:10 16 minutes, 10 seconds bit more time but it will surely come back. 16:14 16 minutes, 14 seconds Yes sir. So my last question uh I think we are in the auto side as we majorly doing for uh IC engines EV hybrid and 16:23 16 minutes, 23 seconds the EV side uh which are the components uh uh we are doing right now and what is the target uh in the coming years. 16:31 16 minutes, 31 seconds So we make uh some complex assemblies uh as well uh completed fully transmission gearboxes as well. We also do some very 16:40 16 minutes, 40 seconds critical components that fit into the hybrid transmissions uh globally in Europe uh and those also get exported to 16:48 16 minutes, 48 seconds all over the world. So I would say we are in a good space in terms of both hybrid and ED and we are trying to horizontally deploy this across our 16:56 16 minutes, 56 seconds customer base uh over the next couple of years. So we would definitely focus on that. We did see that the hybrid market 17:03 17 minutes, 3 seconds uh grew in the last two years compared to the EV global market and therefore we focused a lot on the hybrid market and captured a major market share. 17:13 17 minutes, 13 seconds Well, thank you sir. All the best. 17:21 17 minutes, 21 seconds Thank you. Next question is from the line of NRA from White Pan Investments. 17:26 17 minutes, 26 seconds Please go ahead. Yeah, thank you for the opportunity. Uh you have this order book of 2350 crores on the aerospace side. Uh 17:34 17 minutes, 34 seconds wanted to know how much can you uh you know you know facilitate from the existing facility not including the green field one that's putting up. 17:48 17 minutes, 48 seconds So we are we have planned it in such a way that we will uh you know we will not run out of space till we grow. So we 17:56 17 minutes, 56 seconds will continue to keep our trend of 25% growth till we reach the new green field facility. So nothing will stop us in the 18:04 18 minutes, 4 seconds meantime to continue to keep the growth that we have and in fact we will also continue to develop new products here itself which will then be transferred to 18:12 18 minutes, 12 seconds the new facility when it gets ready to shorten the lead time of customer approvals in the new facility. So a detailed uh seamless plan is being made 18:21 18 minutes, 21 seconds to ensure that there is a continuous growth in the new facility when it comes out without running short of capital in our current facility. 18:32 18 minutes, 32 seconds Okay. So so sorry I'm extending the same question. Uh so your current re yearly revenues for aerospace and defense is 18:39 18 minutes, 39 seconds almost 400 crores and you're talking of a 25% kagger. you are talking of almost uh additional uh you know run rate going 18:47 18 minutes, 47 seconds to 56 around 800 900 crores run rate in FI28 and that's when you're expecting uh 18:55 18 minutes, 55 seconds the the new facility to start so is it the right way to look at when we're starting a new facility by 19:02 19 minutes, 2 seconds end of calendar year FI27 right so we're talking about the 18month period first of all and therefore uh we would be 19:09 19 minutes, 9 seconds closer to a number much lower than what you Right. And we will definitely have capacity to reach that number before we 19:17 19 minutes, 17 seconds move to the new facility in Andhra Pradesh. 19:20 19 minutes, 20 seconds Right. So the last question and I'll come back on the queue. Uh there is lot of shortage of machinery for machines 19:28 19 minutes, 28 seconds like the likes of Grab Gro and other machines in in the global market. Uh so are you uh fully ordered for the 19:36 19 minutes, 36 seconds machines for your facility and uh and or or is it's just a step up on the gradual side? What do you know about? 19:43 19 minutes, 43 seconds So, so first of all, we don't depend on one manufacturer. I think we must be having within our group at least 15 different manufacturers. We look at what 19:51 19 minutes, 51 seconds machines are required for what operations uh what complexity and based on that we buy our machines. We plan our machines lead times well in advance to 20:00 20 minutes make sure that we don't lose out on any of our projects and that will be the trend going forward as well. We also buy from all over the world so it's not restricted at all. 20:11 20 minutes, 11 seconds No immunity. My question is more specific to you. Have you completely ordered all the machines or you are yet in the process of doing it? 20:18 20 minutes, 18 seconds So we continuously have a capacity plan that we order in times of lead time. If our lead time we believe is let's say 6 to 8 months just to give you an example 20:26 20 minutes, 26 seconds then we plan 6 to 8 months in advance to make sure so we we are you have to understand we growing almost on a weekly monthly basis. So it's not like a 20:35 20 minutes, 35 seconds project like a simine plant or some other plant where you know you put a big project and then you expect it to grow. 20:41 20 minutes, 41 seconds Ours is a modular growth which happens every month. So let's say you develop 15 new components this month you know 6 to 8 months from now or you have a ramp up 20:49 20 minutes, 49 seconds plan for them. So you already plan those machines and based on the lead times you have committed to the customer you then plan to buy those machines. So you 20:57 20 minutes, 57 seconds practically have machines coming in every quarter for continuous expansion on growth. So right now also we have several machines that are on order which 21:05 21 minutes, 5 seconds we will receive over the next 3 to 6 months and then we will keep ordering based on what new products have been developed and the ramp up plan of those products. It's a continuous process. 21:15 21 minutes, 15 seconds I'll come back to the queue. Thank you. Sure. Thank you. 21:20 21 minutes, 20 seconds Thank you. Next question is from Sanji from Antic Stock Broking. Please go ahead. 21:28 21 minutes, 28 seconds Uh yeah sir uh uh my question is regarding uh the commissioning. So in 21:35 21 minutes, 35 seconds the presentation we are saying that uh that the commercial production will start by late of 2027. So probably it 21:43 21 minutes, 43 seconds was the end of Can you just can you just I can't hear you very clearly. Can you just either come closer to the mic or just speak a little louder please? 21:51 21 minutes, 51 seconds Yeah. Yeah sir. Uh audible now. 21:55 21 minutes, 55 seconds Yes. Yes. Yeah sir. Uh regarding the commercial uh uh start of the new unit 22:03 22 minutes, 3 seconds in Andhra Pradesh as the presentation is mentioned in uh 2021 m late of 2027. 22:09 22 minutes, 9 seconds So it means that probably it was the uh you know end of fi 28 the commercial 22:17 22 minutes, 17 seconds production start uh correct is that reading right or because I think in your initial dem 22:27 22 minutes, 27 seconds like it'll be like second half or towards the towards the last quarter FI28 you're right calendar year 27 yes 22:35 22 minutes, 35 seconds yeah and uh how would be the capex plan for 27 months towards uh these 22:42 22 minutes, 42 seconds units as well as for the uh uh the existing uh unit. 22:48 22 minutes, 48 seconds Yes. So basically in each of the businesses we will approximately be spending about 100 crores each to build capacities uh which will be consistent. 22:58 22 minutes, 58 seconds Yes. 23:00 23 minutes So 200 cr per year for both the units uh for 27 and 23. Yeah. 23:07 23 minutes, 7 seconds Okay. Okay. And uh sir in the aerospace side what further industry developments you 23:15 23 minutes, 15 seconds are seeing which could be kind of a tailwind for uh for our group? 23:22 23 minutes, 22 seconds Well, we have quite a few strategic plans which I can't disclose fully at this stage till they conclude it. But I can tell you that we are involved at a 23:31 23 minutes, 31 seconds strategic level with both OEMs and tier ones uh with some long-term large businesses which only once they conclude I can bring to the notice that there's a 23:40 23 minutes, 40 seconds lot in the pipeline. there's a lot of effort being put to move up the value chain which we've been talking about uh and also add more uh value added work 23:49 23 minutes, 49 seconds also in terms of sub assemblies and then final assemblies we've also like I mentioned before we're doing some uh you know design to build work so on all the 23:58 23 minutes, 58 seconds fronts we're trying to expand the value creation okay great sir uh and uh just one last 24:07 24 minutes, 7 seconds question on the other income side on the consolidated basis the other income has fallen in my so is there probably some 24:15 24 minutes, 15 seconds dividend that you would have received in the first quarter of last which was not there in this 24:23 24 minutes, 23 seconds so there are two parts to the other income there is there is other income which we get because there's a surplus fund 24:32 24 minutes, 32 seconds or surplus corpus available in uh in let's say um Raymond Limited which is the parent company and then there's also 24:40 24 minutes, 40 seconds other oper income which is you know essentially generated from let's just say a sale of scrap and all because more particularly in the aerospace business 24:48 24 minutes, 48 seconds there's a lot of scrap generated you know because of a new machine so it has both elements 24:56 24 minutes, 56 seconds okay uh right sir I think uh I'll stop here and further question I'll come back 25:04 25 minutes, 4 seconds thank you thank you next question is from Kaman Bahiti from Incred Capital. Please go ahead. 25:13 25 minutes, 13 seconds Hi sir. Uh thank you for the opportunity. I hope I'm audible. So my first question was uh in the line of our 25:21 25 minutes, 21 seconds uh precision auto business. So the IIDA margins expanded around 250 260 basis 25:29 25 minutes, 29 seconds points but uh the topline growth was only like uh 10% on a yearly level. So 25:36 25 minutes, 36 seconds what what really drove the Aida margin expansion and is it fair to assume that these uh uh kind of uh margins are sustainable? 25:51 25 minutes, 51 seconds So so first of all there's were there was an exception of 13 crores which I hope you're aware of which you have to take out from the equation which was a one-time cost from the land sale that we 26:00 26 minutes had. So once you remove that basically you know we implemented SAP uh in August. We did a lot of work on 26:08 26 minutes, 8 seconds integrating all of the companies. We then did a lot of synergies across the companies and all of this I would say 26:16 26 minutes, 16 seconds came together you know before the start of the last quarter and therefore synergies from the companies cost reduction activities improvement in 26:24 26 minutes, 24 seconds efficiencies consolidated buying uh all of those had a role to play in margin expansion and I and the margin uh uh 26:33 26 minutes, 33 seconds will continue going forward as well because these are permanent uh uh synergies and cost reduction programs 26:41 26 minutes, 41 seconds that we've put in place. Yes, this year there's going to be some amount of pressure because certain raw materials have gone up but normally these are 26:49 26 minutes, 49 seconds passed through so there will be a lag but in effect the margins should remain uh where they are. 26:56 26 minutes, 56 seconds See there is a big you know strong cost consciousness mindset uh and which is why you know we are running a formal 27:03 27 minutes, 3 seconds cost reduction program this year. So, so clearly the focus on improving margins not just from the growth but also from cost efficiency remains a priority. 27:16 27 minutes, 16 seconds All right sir. And and in our segmental performance also we have some uh other operating income or losses there. So we 27:25 27 minutes, 25 seconds incurred around 13 cr of uh you know loss uh in the other segment. So uh could you give a breakup of that? 27:38 27 minutes, 38 seconds Yeah, I just uh you know see um the Raymond the Raymond 27:46 27 minutes, 46 seconds corporate essentially which is the which is the holding company has other income which comes in for in the form of 27:53 27 minutes, 53 seconds interest income that it generates from the corporate it has but obviously it has some expenses as well so more or less you know of course you know you 28:01 28 minutes, 1 second can't measure that on a quarterly basis but I guess the best thing is to look at it on a full year basis and on a full year basis the income more than offsets 28:10 28 minutes, 10 seconds the expenses and therefore to that extent you know it could be one quarter year there but but broadly um the way 28:18 28 minutes, 18 seconds you have to look at this business is that Raymond corporate will be more or less even okay there could be some marginal loss some some quarter or some 28:26 28 minutes, 26 seconds year and there could be positive some years some etc but but broadly neutral the way to kind of look at this business 28:34 28 minutes, 34 seconds is to look at the aerospace and the auto segment and then really focus on those two segments and not not on the corporate that you can assume will be 28:42 28 minutes, 42 seconds always even with some marginal loss for profit. 28:47 28 minutes, 47 seconds All right sir got it and and lastly on our uh aerospace business uh we have highlighted our order book. So this 28:55 28 minutes, 55 seconds order book is largely from Saffron or are we are we taking in any other uh customers? what is their concentration? 29:05 29 minutes, 5 seconds So you have to appreciate that we have over 25 customers and one of our strategies has been to derisk our customers. Even when you talk about the 29:13 29 minutes, 13 seconds OEM you mentioned, we have more than seven different legal entities. So we are working with many of them. So the point is to derisk our business across 29:21 29 minutes, 21 seconds several customers with whom we already have approvals and that puts us in a very good position to scale business. 29:28 29 minutes, 28 seconds All right. So I mean uh so so my direct question was uh can you give a breakup of how much would the leap engines from the total order book only leap engines? 29:39 29 minutes, 39 seconds Well I can't I I I don't think it's uh it's okay for me to give you a direct breakup but let me tell you that uh over 29:46 29 minutes, 46 seconds 75% of the products that we make are for the engine segment across the OEMs uh you know globally which should be a good uh direction for you to know. 29:58 29 minutes, 58 seconds All right. So sen lastly uh I mean I'll uh I'll join by uh baggy after this. So uh we have guided that we'll be adding 30:06 30 minutes, 6 seconds around uh 300 to 350 new components every year. So so how how has that been 30:14 30 minutes, 14 seconds uh playing out till now? Are we in line to you know ramping up those things? 30:20 30 minutes, 20 seconds Yeah. So I I talked about one component a day that we will start to do and uh this year we should manage that but I 30:28 30 minutes, 28 seconds don't count your uh you know all the days in the year. So I would say 250 is possible to be made this year and we should be on track for it. 30:39 30 minutes, 39 seconds All right. All right. Thank you so much. I'll join back. Thank you very much. 30:46 30 minutes, 46 seconds Next question is from the man of Aliat Singh from Amus Capital Partners. Please go ahead. 30:54 30 minutes, 54 seconds Um hello. Uh so firstly uh congratulations on a good set of numbers. Uh I have a couple of 31:00 31 minutes questions. So first on uh on the uh uh net cash number that you have presented 31:06 31 minutes, 6 seconds which is 68 cr. If I look at the balance sheet right so I see borrowings of around 1,000 K and some cash of 200 K. 31:16 31 minutes, 16 seconds So can you please provide the reconciliation for the firm? 31:22 31 minutes, 22 seconds Sorry which which page are you referring to? I mean, so borrowings is uh if I look at the 31:32 31 minutes, 32 seconds console balance sheet, borrowings comes to about 1,000 K and uh the net if I look at the cash and bank balance, it's 31:40 31 minutes, 40 seconds around 200 K. So I just trying to understand what else is included in the cash uh line item. 31:50 31 minutes, 50 seconds Yeah. So there are investment in other marketable securities, right? I mean you you I mean you have lots of uh uh let's 31:57 31 minutes, 57 seconds say instruments then which you in which you invest to optimize your heat um when you're sitting on a large corpor 32:07 32 minutes, 7 seconds instruments there okay these would be liquid liquid instruments right all marketly 32:16 32 minutes, 16 seconds liquid I mean some may have two three year kind of time frame but largely liquid okay okay That uh helps that helps. And 32:24 32 minutes, 24 seconds so the second uh question is more uh along the lines of uh you know on the aerospace business uh so right now we 32:33 32 minutes, 33 seconds are primarily into engines but as we scale right uh is there any plans to get into let's say aeros structures or 32:41 32 minutes, 41 seconds landing gear? So if you can uh help me understand if there's any strategy around it. 32:47 32 minutes, 47 seconds Yeah like I said before it's 75% in engine. So obviously that other 25% we are in landing gears, we are in 32:54 32 minutes, 54 seconds hydraulics, we are in fuel, we are in other accumulators, we're in auxiliary engines. So we have not restricted 33:03 33 minutes, 3 seconds ourselves to any. The idea was to create uh enough relationship with the aerospace industry as a whole and then 33:11 33 minutes, 11 seconds depending on where the opportunities were, we would take them. So we will definitely be taking opportunities in all areas. Obviously keeping in mind our 33:19 33 minutes, 19 seconds growth rates, our ROC's, our returns and wherever we find them to be the best, we will pursue those on priority because 33:26 33 minutes, 26 seconds like we said the market is so large that uh it's more limited by what you can execute rather than market. So it's very 33:34 33 minutes, 34 seconds important to execute right and that is the focus of uh the the company now is to make sure that we can we can grow our 33:43 33 minutes, 43 seconds execution base. See the critical thing is that you know I mean the biggest opportunity for us is when we start 33:49 33 minutes, 49 seconds setting up Andra it's a clean slate for all. So on a clean slate the and and Gotham alluded to it but maybe I'll make 33:57 33 minutes, 57 seconds it more specific that you know the kind of conversation we are doing with most of our partners are basically to say you tell us what you want us to put you know 34:06 34 minutes, 6 seconds kind of story so that we can become more strategic with them. So obviously we want to a you know make it kind of 34:14 34 minutes, 14 seconds one-stop shop uh for the customer so that that will um help the business uh 34:22 34 minutes, 22 seconds trajectory as well as I think one of the other participants as a point on 250 parts and those those kind of things but 34:30 34 minutes, 30 seconds I think it's not the 250 which is more important what is important is that how do you go you go up the value chain on those 250 parts so that's also part of 34:38 34 minutes, 38 seconds that strategy because a you know there's no baggage. It's a total new parcel of land. You I mean you have you have about 34:45 34 minutes, 45 seconds 45 acres for aerospace. So we can we can do what we like to do there and and 34:51 34 minutes, 51 seconds therefore we would rather take uh the try to reshape the trajectory of the business um you know versus doing more 35:00 35 minutes of the same. So those are the kind of things we are trying to work on. Of course, they'll happen when they happen, but but but that's the thought process. 35:11 35 minutes, 11 seconds Understood. Uh thank you so much and all the best for FI27. Thank you. 35:19 35 minutes, 19 seconds Thank you. I request all the participants kindly limit yourself to two questions per participant so the management can address all the questions. 35:28 35 minutes, 28 seconds Next question is from the line of Rakkesh Roy from boarding. Please go ahead. 35:33 35 minutes, 33 seconds Hi sir my first question regarding you sir your aeros business as you mentioned this will grow 25% year so uh is s for 35:43 35 minutes, 43 seconds fi 29 how much revenue we expect from your andra plant from the space 35:54 35 minutes, 54 seconds yeah so obviously the andra plant in the first few months you can't expect any revenue because you'll have customer approvals 36:02 36 minutes, 2 seconds and stuff like that. So we will grow in a very small way in FY28 which is your calendar year ending FI27 and last 36:11 36 minutes, 11 seconds quarter of uh FI28 in FY 29 you will see the real growth and let me let me address try and address 36:20 36 minutes, 20 seconds this question separately without getting into specific numbers. See we have we have the capacity to grow this business by 25% for next year within our existing 36:29 36 minutes, 29 seconds system. So to that extent whatever growth will happen will happen in the existing unit to a large extent and then 36:37 36 minutes, 37 seconds and really start kicking in towards the end of FY uh 28. Now FY 29 you I mean the next 25% has to come from Andra. 36:50 36 minutes, 50 seconds Okay. Yeah. 36:52 36 minutes, 52 seconds But the next 25 has to come from and it can't come from anywhere else. 36:58 36 minutes, 58 seconds My Okay. Okay. So assumption for for existing business as business your business 28 year by 650 CR from this one 37:08 37 minutes, 8 seconds for F29 again we take 25% more from existing plan and for 25% of 7800 or 37:17 37 minutes, 17 seconds just again you have to add 200 mathematics I mean you can do your math as much as we can do now. 37:28 37 minutes, 28 seconds Okay. But all we can say at this stage is that you know uh we are targeting a 25% growth year on year and for the 37:37 37 minutes, 37 seconds first year growth can be taken care by the existing fund the second year will have to be taken care by math it will be some number between 150 to 200 cr but 37:46 37 minutes, 46 seconds whatever that number is right okay uh so my next question regarding auto 37:52 37 minutes, 52 seconds business especially EV side uh uh s demand for EV is increasing uh Europe. 38:00 38 minutes So any any outlook from your side how the demand or how is the product for Europe any export to Europe also? 38:08 38 minutes, 8 seconds So I I would say that the demand for hybrids has been much higher than just the demand for EVs where we have been spending a lot of time as well and uh that demand looks very strong uh for us. 38:20 38 minutes, 20 seconds In fact the volumes are are increasing and it's helping offset some of the other issues that are there with markets. So I would say the hybrid market will continue to be very strong. 38:30 38 minutes, 30 seconds The EV market we have to still watch because the governments in Europe have moved the dates out by four five years. 38:35 38 minutes, 35 seconds So to that extent the EV market is not as strong as the hybrid market but as a percentage they continue to grow. 38:46 38 minutes, 46 seconds Thank you Rakkesh. I'll request you to come back for a follow-up question. 38:51 38 minutes, 51 seconds Participants kindly limit yourself to one question per participant and we join with you for a follow-up question. 38:57 38 minutes, 57 seconds Next question is from the line of Via Jane from Sapphire Capital Partners. Please go ahead. 39:05 39 minutes, 5 seconds Hi sir, thank you for taking my question. So for FI27, what kind of growth do we expect with uh and what kind of EITA margins are we expecting? 39:21 39 minutes, 21 seconds Yeah. So you've seen us historically grow at a certain pace and we're going to keep that growth rate constant, you know. So I feel that u there's a 39:31 39 minutes, 31 seconds positive signal and we will move in that uh on that basis. 39:41 39 minutes, 41 seconds Thank you. Also with the margins. Yes, also with the margins. 39:48 39 minutes, 48 seconds And sir, can you also provide the break up of the kix that we are planning to do over the next five years? 39:59 39 minutes, 59 seconds Yeah, each year almost you can take approximately 100 crores from each company. 40:05 40 minutes, 5 seconds So over five years you'll probably spend thousand crores. Okay sir. Love you. Thank you so much. 40:15 40 minutes, 15 seconds Thank you. 40:17 40 minutes, 17 seconds Thank you. The next question is from Zan of Nam from Sanji Family Office. Please go ahead. 40:25 40 minutes, 25 seconds Hi. Uh hi team. Uh I hope I'm audible. Yes. Yes, you are. 40:32 40 minutes, 32 seconds Great. Uh so first of all, congratulations on a very strong set. 40:36 40 minutes, 36 seconds Actually, it's getting discouraged because of the other income other other income bit of it. Uh but uh there are a 40:43 40 minutes, 43 seconds couple of questions. First is one you know you've said that we have a very interesting pipeline of product developed and products that are under 40:52 40 minutes, 52 seconds development. So could you tell me uh or would it be able would it be possible for you to share status on say total 41:00 41 minutes number of products de developed and total number of products commercialized. 41:05 41 minutes, 5 seconds Uh what would be the proportion of it and how do you see that ramping up? Could you throw some light on that? That's your first question. 41:13 41 minutes, 13 seconds Yeah. Yeah question. Okay. Okay. Go ahead. Yeah. 41:18 41 minutes, 18 seconds Answer the first and maybe it will be easier. So, so basically see if whatever you develop depending on the timeline 41:25 41 minutes, 25 seconds that you have from the customer certain products can ramp up between 3 months, some will take 6 months, some will take 9 months depending on the complexity, 41:33 41 minutes, 33 seconds depending on the customer's order, depending on the contract the customer wants with you. So, you have to work everything backwards from what the 41:41 41 minutes, 41 seconds customer wants as a p as a portion of ramp up. So basically you you have to appreciate if you take an average period 41:47 41 minutes, 47 seconds of about uh 6 months right uh you will maybe have 100 125 parts that are not 41:55 41 minutes, 55 seconds yet in ramp up but are in a process where you've developed the samples and that's a cycle because those parts will then come into your ramp up they will 42:03 42 minutes, 3 seconds then go into production and then you'll have new parts that come into your new product development. So it's a continuous cycle that runs and that could be the gap. As you increase your 42:11 42 minutes, 11 seconds new product development, you'll have more and more parts in the pipeline before they ramp up. But that's what the number looks like today. 42:21 42 minutes, 21 seconds Thank you, Nan. I'll request to come back for a follow-up question. 42:26 42 minutes, 26 seconds The next question is from the line of Panka from F1 Assets. Please go ahead. 42:32 42 minutes, 32 seconds Uh I'm auding about the capex plan you have about your 42:43 42 minutes, 43 seconds company for both the companies. Just wanted to understand what are the uh plans for funding the sale and secondly 42:50 42 minutes, 50 seconds the growth rate of the company uh segment which you uh which we part of 42:59 42 minutes, 59 seconds our company. I just wanted to understand what is the go rate for next few years. 43:04 43 minutes, 4 seconds So basically uh you know at the Raymond Limited we're sitting with thousand cr of cash right. So there's uh so there's enough sitting there plus the internal 43:12 43 minutes, 12 seconds generations. So based on that we don't see any uh problem in funding the tax. 43:21 43 minutes, 21 seconds So due to that will the parent company increase the state sorry you're not audible. 43:27 43 minutes, 27 seconds due to that response responsible. So I guess I I think the critical thing is that the balance sheet of the 43:36 43 minutes, 36 seconds engineering business itself with the kind of earning growth trajectory that we are estimating 43:43 43 minutes, 43 seconds itself has strength to take care of the growth plans. So it doesn't need to actually draw upon the parent company for any capital 43:52 43 minutes, 52 seconds for for its organic needs. So to that extent you know we can continue to grow the business while strengthening our balance sheet also. Now on top of it the 44:02 44 minutes, 2 seconds safety net is that the p the parent company has has liquidity. So therefore um which is why if you see on an overall 44:10 44 minutes, 10 seconds basis you know we have a pretty much almost zero net you know so that's that's something which will continue 44:17 44 minutes, 17 seconds the beauty that will the company increase the stake in the uh women because if the if the businesses can 44:26 44 minutes, 26 seconds selfund itself from its cash flows and the cash flow generation and the earning growth trajectory then you don't have to 44:35 44 minutes, 35 seconds really draw some capital from parent company for the organic leaves. Of course, if something inorganic happens depending on the size, scale etc. then 44:43 44 minutes, 43 seconds at that stage maybe parent company will have reaching that is anticipated at this point in time. uh having done the 44:51 44 minutes, 51 seconds long-term projection you know for doing 200 cr of capex I really don't need 200 cr rupees right it always a mix of 44:58 44 minutes, 58 seconds approval and debt so our cash flows are supporting us 45:06 45 minutes, 6 seconds thank you very much panka I'll request to come back for a followup next question is from Pa Singh 45:13 45 minutes, 13 seconds individual investor please go ahead um hi so my question is regarding in the recent order win in the build to spec 45:22 45 minutes, 22 seconds domain. Could you throw some more light on this please? 45:27 45 minutes, 27 seconds Actually we not able to disclose that right now due to confidentiality but uh this is a product that we've developed for a customer which is also designed 45:35 45 minutes, 35 seconds completely by us and uh it's the first time we did a build to spec. So our goal is to look at how we can take it. It's a 45:43 45 minutes, 43 seconds slower process. It's not immediate results, but I'm glad that we've got our first order and uh therefore we will be spending more time on this as the years go by. 45:54 45 minutes, 54 seconds No, congratulations on that. And uh could you throw light on how this would position us to move up the value chain? 46:01 46 minutes, 1 second No, obviously today we make components based on an assemblies and subasssemblies based on customer drawings. This would be our own product. 46:09 46 minutes, 9 seconds So obviously it makes a big difference but you have to start small. So it takes time you know the aerospace industry is not an industry where you can just get 46:18 46 minutes, 18 seconds in and do something. You'll take a few years to establish yourself in the build to uh into into the build to spec area 46:26 46 minutes, 26 seconds and we've just made a beginning there as one part of our value addition that we intend to bring uh in different parts of our business in aerospace. 46:35 46 minutes, 35 seconds Got it. Thank you and all the best for the new. Thank you. Thank you. 46:43 46 minutes, 43 seconds Next question is from the line of Madun Jane from PMS. Please go ahead. Uh hi. Uh am I audible? 46:52 46 minutes, 52 seconds Yes sir. Go ahead. 46:52 46 minutes, 52 seconds Hello. Yeah, sorry. Uh so um I'm I'm particularly new to this company. I had a doubt uh on the uh shareholding 47:01 47 minutes, 1 second pattern. So uh when as an investor I I am invested in Raymond Limited. What do I get as in I am I I actually get a 47:10 47 minutes, 10 seconds share of the parent company, right? the Raymond Limited company which has got two subsidiaries and the parent company has got about 66% uh shareholding uh in the two subsidiaries if I'm not wrong. 47:22 47 minutes, 22 seconds So uh can can somebody please clarify as in the minority interest gets uh subtracted from my uh I mean how does it 47:31 47 minutes, 31 seconds work out? See I think the very simple way to look at it is that it's a 300 cr 47:38 47 minutes, 38 seconds broadly vida company and you own as a shareholder two3 of that aid so it's a 200 cr bidder that you own then there is 47:46 47 minutes, 46 seconds a debt at the at the businesses but there there's more than liquidity as the parenting company which offsets that 47:53 47 minutes, 53 seconds debt. So to that extent if you have to just simply look at the company then you have to say it's a 200 cr IA that you own 48:01 48 minutes, 1 second in a very very simple about 65% of uh whatever IA that the 48:08 48 minutes, 8 seconds company generates right at uh uh at a annual level 66.3% now 66.3 is 2/3 so if company does 48:18 48 minutes, 18 seconds 300 crit then you own 200 cr of that because 66.3% is roughly So I'm just making it simple for you. Of 48:26 48 minutes, 26 seconds course you know um you have to multiply by 66.3% if you want to be precise. 48:35 48 minutes, 35 seconds Got it. And uh my another uh question would be um since we are in in our aerospace business since we are into uh 48:44 48 minutes, 44 seconds turbine veins and all that uh do we have a a play in the in the uh gas turbine segment as well other than the uh 48:53 48 minutes, 53 seconds aerospace business are we looking into that as a as a possible segment? 48:58 48 minutes, 58 seconds So we have looked at it and uh we don't rule it out in the future because uh there are similarities and we have some 49:07 49 minutes, 7 seconds RFQS in that direction. So we are definitely looking at it uh and it it will be very natural for our own production as well. 49:16 49 minutes, 16 seconds Thank you Maidon. I'll request to come back for a follow-up question. 49:24 49 minutes, 24 seconds Next question is from the line of Sand Takar from Chris PMS. Please go ahead. 49:30 49 minutes, 30 seconds Hi sir. So across our raw material mix, so across in across stainless steel, titanium, aluminium, how much do we 49:37 49 minutes, 37 seconds import and what do we import and how much it's sourced from India? Yeah. 49:43 49 minutes, 43 seconds So typically as of today you import 100%, right? We've just started development of few of the materials uh 49:50 49 minutes, 50 seconds which are hopefully over the next 6 to 8 months we'll see some progress. In auto we don't but I'm talking specifically on 49:58 49 minutes, 58 seconds arrow right on arrow we import 100% today because you need approvals etc. So slowly over the years as we localize 50:06 50 minutes, 6 seconds these materials and as the OEMs give approvals this will actually be in the favor of not only us but all Indian 50:14 50 minutes, 14 seconds companies to get more competitive in the future as these raw materials get localized in India. 50:23 50 minutes, 23 seconds Okay. And in terms of your STUs and components, you said that you'd add about 200 to 250 components this year. 50:30 50 minutes, 30 seconds Now, what's what is the mix between assembly and components? Like is there is there a misconception that can be defined on that side? 50:40 50 minutes, 40 seconds Yeah. So, I would say probably 20 25% of them would be subasssemblies. Some would be main assemblies uh and the rest would be components that you would use for 50:49 50 minutes, 49 seconds those subasssemblies or some components you would use which are complex components you would use on your own. 50:54 50 minutes, 54 seconds Typically in the engine side you will have a lot of sub assemblies or on their own 51:01 51 minutes, 1 second unlike structures and systems where you could have more number of assemblies. 51:08 51 minutes, 8 seconds Thank you. Someone I'll request to come back for a follow-up question. 51:12 51 minutes, 12 seconds Next question is from line of Ruben from Equ intelligence. Please go ahead. 51:18 51 minutes, 18 seconds Yeah. Hi sir. I just want to know in a space what is your current utilization and is the growth more constrained because of the capacity or is it because of the orders? 51:30 51 minutes, 30 seconds So the growth will always uh I I don't think it is either. It is a question of execution. So when you say execution, you got to have the right engineering, 51:39 51 minutes, 39 seconds you got to have the right process, you got to have the right tools, you have to have the right fixtures, you got to have the right systems. So it's the entire 51:46 51 minutes, 46 seconds supply chain process end to end that you deliver a product and and the pace at which you can do it and the speed and 51:54 51 minutes, 54 seconds accuracy with which you can do it. So it's a question about having the entire delivery process uh smoothened out 52:01 52 minutes, 1 second rather than just saying is it capacity or is it uh you know uh um orders. It's definitely not orders. It's the ability 52:10 52 minutes, 10 seconds to execute and capacity is only one issue of the entire supply chain. So you not get you need to get the whole story right. Right. And then it works. 52:20 52 minutes, 20 seconds Okay. Because see um we've been hearing about this huge order backlog by you know various the bigger OEMs and all but right now when we're looking at this 52:29 52 minutes, 29 seconds order book of 2300 over 5 years it's just 460 a year. So I'm just trying to understand what and help me understand 52:36 52 minutes, 36 seconds what is holding back um this uh uh revenue um expansion um you know why isn't growth going as much as the order 52:44 52 minutes, 44 seconds backlog conversion you know I'm just trying to understand that. Yeah, you need to understand that these orders are for products that you've already made, 52:53 52 minutes, 53 seconds not for products that you're making because they are not in the contract yet. When you make, let's say, the 200 products we would make this year, those 53:00 53 minutes are not in the contract. So, almost on a monthly basis or a quarterly basis, your order position keeps increasing based on all the new products you keep adding. 53:09 53 minutes, 9 seconds So, it's not like a fixed. This is the current situation where the situation is changing every day, every week, every month. 53:17 53 minutes, 17 seconds These are the orders that you've had in the past. See, this is like if we stop taking new orders then how big the order book is. 53:24 53 minutes, 24 seconds But we'll not stop taking orders, right? 53:31 53 minutes, 31 seconds Thank you to come back for a follow-up question. 53:37 53 minutes, 37 seconds Next question is from Sahil from White Investments. Please go ahead. Hi, thank you for the opportunity. 53:45 53 minutes, 45 seconds What will be the capacity utilization of the current 8,000 units per year and what would be the incremental capacity for this veins uh in the ANRA plant? 53:59 53 minutes, 59 seconds So the veins we have enough capacity in the current plant and we've just uh doubled our order. So uh we'll be adding 54:06 54 minutes, 6 seconds it in this plant itself uh before we go to the Amra plant. uh and uh um you what 54:13 54 minutes, 13 seconds was the second question you you capacitor in the uh Andra plant for these wheels? 54:22 54 minutes, 22 seconds Yeah. So there are different kinds of rings. The ones we do today are cast iron, they're out of titanium, they're out of steel, some of them are machined, some of them are uh you can't even 54:31 54 minutes, 31 seconds machine because they're made out of hard metal. So the many varieties of veins and depending on which variety we will get how much order then we will based on 54:39 54 minutes, 39 seconds that we will do our Andra plan. So we will also fill up first our current capacities here and then based on whatever new orders come we will move 54:48 54 minutes, 48 seconds them to Andra thank you I'll request to come back for a follow-up question. 54:57 54 minutes, 57 seconds Next question is from N of Har from Toro. Please go ahead. 55:08 55 minutes, 8 seconds May I requested unmute your line and proceed with your question? 55:18 55 minutes, 18 seconds Need to know response. We move to the next participant. 55:23 55 minutes, 23 seconds Next question is from Nano Shashi Khan from Brighter Mind. Please go ahead. Uh uh first of all congrats for the good 55:32 55 minutes, 32 seconds set of numbers. Uh I have one question that uh one of our peer group has recently won from ro. So were we 55:39 55 minutes, 39 seconds participating in the you know similar program. Hello. 55:51 55 minutes, 51 seconds Yeah. What was the last part of your question? Uh so uh you know one of our PR uh group or company has recently won 56:00 56 minutes order from Bras. So were we participating in that program also? 56:06 56 minutes, 6 seconds It's not an order event per se. There was an acquisition opportunity of an asset 56:13 56 minutes, 13 seconds um which which was which came with lot of its own set of complexities which is why which is what they have acquired and 56:21 56 minutes, 21 seconds what they acquired had a contract contractual term as part of the acquisition. So they have just 56:29 56 minutes, 29 seconds aggregated the the entire contractual term of the current size of the business. So it's not a new win that 56:37 56 minutes, 37 seconds they have. Having said that uh you know there are lots of RSQs that we are participating with uh I mean not just 56:47 56 minutes, 47 seconds but many other customers. So as we keep winning them we will keep reporting them. 56:52 56 minutes, 52 seconds Okay. Uh so just an extension of that question. So what is the timeline uh you know gap between the RSQ and the real 56:59 56 minutes, 59 seconds order placements from the OEMs? So again it depends like I said you know if if you take the OEMs they have different 57:07 57 minutes, 7 seconds complexities. So if the parts are very simple then the turnaround time is very quick. Uh in some cases we have self approval process. So they don't even 57:15 57 minutes, 15 seconds check our parts. They trust us to do the right job. In some cases the medium complexity it could take 3 to 6 months. In very complex it could go 12 months. 57:23 57 minutes, 23 seconds So if it needs validation it can go even further. So I think each part is on its own but and that's the reason why you you have to make a lot of parts because 57:32 57 minutes, 32 seconds each one will follow its own path which will have its own ramp up plan will have its own growth strategy. So the ability of a company to continuously make new 57:40 57 minutes, 40 seconds product continuously scale up and ramp up. Uh that's what we are looking at. 57:48 57 minutes, 48 seconds Thank you Shashi Gant. I'll request you to come back for next question. 57:53 57 minutes, 53 seconds The next question is from the Mr. Barak from LS Finance. Please go ahead. 58:01 58 minutes, 1 second Hello. Yes. Go ahead. Uh yeah. So my question is for Mr. Dr. 58:08 58 minutes, 8 seconds Miy and uh I was in a uh I I read the call you had I think last year where you mentioned that there are four levels of 58:17 58 minutes, 17 seconds critical components N1 to N4 and we work at N2 and I think that tech uh was at least 58:24 58 minutes, 24 seconds partially was transferred to us by Saffron. Um so are we planning to get into N1 level of components the rotating 58:31 58 minutes, 31 seconds components do we have the capability and if we are not planning to do so why is that 58:39 58 minutes, 39 seconds so definitely I think the wish list is definitely N1 it takes time it took us 5 years to go from N4 to N3 took us 58:46 58 minutes, 46 seconds another five to go from N3 to N2 so these are long-term uh programs where the customers really test you out and 58:54 58 minutes, 54 seconds make sure that you are really reliable supplier uh you know you have to carry heavy insuranceances you have to do a 59:02 59 minutes, 2 seconds lot of things and which we've done right and therefore there's no reason why we would not want to do an N1 we definitely are pitching and we hope that the 59:10 59 minutes, 10 seconds customers uh you know one day will buy our pitch and we can do N1 pass so that's definitely part of our wish list 59:17 59 minutes, 17 seconds awesome that's that's great to hear uh can I squeeze in one more question please go ahead 59:24 59 minutes, 24 seconds uh what so this might be for the CFO the the depreciation is very high for our IBITA right so like how does how does 59:33 59 minutes, 33 seconds the company generate cash flow like the capeex I think you mentioned in the past that uh the capex will come from internal acrals and debt so if the 59:41 59 minutes, 41 seconds depreciation is so high how do we generate internal acrals and maybe I'm not very bright here so maybe please enlighten me 59:49 59 minutes, 49 seconds see we also have significant intangibles in our books uh to the tune of around 800 CR 59:57 59 minutes, 57 seconds On that we have a significant part of uh depreciation coming which though in terms of calculation appearing into 1:00:05 1 hour, 5 seconds depreciation but that's more of uh you know uh uh it's not really really impacting our cash basically it's rather 1:00:14 1 hour, 14 seconds uh helping us in a way. So the depreciation number which seems very high to that's largely coming because of you know the intangibles that we have in 1:00:23 1 hour, 23 seconds our books our actual gross block is not that big and u I'll again stick to the same statement that we have enough cash 1:00:31 1 hour, 31 seconds flow which is getting generated into our business for funding our further expansion see you have to understand this depreciation is a non-cash charge so to 1:00:41 1 hour, 41 seconds that extent because there are intangibles which which you know got created out of a merge So those intangibles and depreciation of 1:00:49 1 hour, 49 seconds that in some sense is actually helping the cash flow because of the um you know the the tax advantage that you get on 1:00:57 1 hour, 57 seconds that depreciation. So it's actually helping rather than hurting. Thank you very much. 1:01:06 1 hour, 1 minute, 6 seconds Next question is from man of indivision investor. Please go ahead. 1:01:12 1 hour, 1 minute, 12 seconds Hi. Hello. Am I audible? Yes also go ahead. 1:01:18 1 hour, 1 minute, 18 seconds Okay. Yeah. Thank you. Uh I just want to know as of today we are not interested in moving uh towards surface treatment 1:01:26 1 hour, 1 minute, 26 seconds right. I mean scaling up uh vertically rather we are more interested in scaling up horizontally right mean uh to 1:01:33 1 hour, 1 minute, 33 seconds maintain a tradeoff between ROC or margins which we explained in previous calls. it's still that time or we are looking for uh getting into surface 1:01:42 1 hour, 1 minute, 42 seconds treatment or the margin accative uh processes. 1:01:48 1 hour, 1 minute, 48 seconds So uh obviously uh we were constrained also with a lot of other things where we wanted to grow topline, we wanted to grow with customers uh and we had limited space in our current location. 1:01:59 1 hour, 1 minute, 59 seconds Now that we have Andra definitely our plans have changed. We are discussing with all of our customers in a strategic manner to understand what will be their 1:02:07 1 hour, 2 minutes, 7 seconds surface requirements over the next five years. Heat treatment requirements. 1:02:11 1 hour, 2 minutes, 11 seconds We're willing to be vertically integrated where it's needed. So we are moving to a much more strategic level with the customers where they can depend 1:02:18 1 hour, 2 minutes, 18 seconds fully on us as a one-stop shop and we don't have to depend for all cases outside. Obviously this was this will be done with a lot of prudence not to carry 1:02:26 1 hour, 2 minutes, 26 seconds on with surface treatments where there's a lot of capacity in the country but rather to go after those surface treatments that would build a business 1:02:34 1 hour, 2 minutes, 34 seconds case for us in the next 3 to 5 years. Uh so this is definitely on the cards and we are aggressively pursuing information from all our customers as to where we should look to invest. 1:02:45 1 hour, 2 minutes, 45 seconds Okay, perfect. And the last one a short one is uh c can you please let me know like what all steps we are taking to 1:02:53 1 hour, 2 minutes, 53 seconds reduce the audit or clearances process for the new green field because I think when I was reading it it takes two to 1:03:00 1 hour, 3 minutes three years to get it approved in the I mean various kind of certifications right so if you're targeting by end of 1:03:06 1 hour, 3 minutes, 6 seconds fi 27 calendar year or Q1 FI28 kind of uh I mean we can kick off the production so is it feasible considering the audit 1:03:14 1 hour, 3 minutes, 14 seconds and clearances will be can or it's more on the lines that we will produce the self-certified things which doesn't need external approval of. 1:03:24 1 hour, 3 minutes, 24 seconds No, so it'll be a combination of things but mostly since this is a new plant and our customers would want us to make at the new plant because it'll have a lot 1:03:32 1 hour, 3 minutes, 32 seconds of things that they will like including you know sustainability uh mechanization, automation uh there'll be a lot of stuff that they would love 1:03:41 1 hour, 3 minutes, 41 seconds in that new factory. So in fact they will actually push for us to move our products there. So it would not be uh 1:03:49 1 hour, 3 minutes, 49 seconds something painful because it's uh you know the company's already approved it's only a question of second location. Uh that is not a very difficult thing. It's 1:03:57 1 hour, 3 minutes, 57 seconds if you're not approved by a company and you want to go and get approval for the first time then it takes two years. But in our kind of situation that will not 1:04:05 1 hour, 4 minutes, 5 seconds be the case. So that will be managed very well and very much in advance. In fact, all of our customers already know about our plan, you know, uh 16 months in advance. 1:04:15 1 hour, 4 minutes, 15 seconds So, we're going to plan with every customer how to do that. Yeah. 1:04:18 1 hour, 4 minutes, 18 seconds Okay. Thank you, sir. And sir, uh any plans to get into single fiscal materials as of now? 1:04:26 1 hour, 4 minutes, 26 seconds Right now, no plans, you know, because uh that's not our core business. Uh you know, we that would become a supplier for us when we need to get in there. 1:04:35 1 hour, 4 minutes, 35 seconds We'd like to start with the heat treatment, surface treatment, finishing, assembly, etc. and give a complete uh 1:04:43 1 hour, 4 minutes, 43 seconds sort of a value added product to our customers at this point in time. 1:04:48 1 hour, 4 minutes, 48 seconds Cool. Thank you very much, sir. Good luck. Thank you. 1:04:52 1 hour, 4 minutes, 52 seconds Thank you very much. Lady, we will take that as our last question. I'll now end the conference for closing comments. 1:05:04 1 hour, 5 minutes, 4 seconds So thank you very much uh for the uh you know for the many interesting questions and thank you for all your support for recognizing that the sectoral 1:05:12 1 hour, 5 minutes, 12 seconds performances have been great and we look forward to seeing you all in the next quarter. Thank you once again. 1:05:21 1 hour, 5 minutes, 21 seconds Thank you very much on behalf of Anandati that concludes this conference. 1:05:25 1 hour, 5 minutes, 25 seconds Thank you for joining us and you may now disconnect. Thank you.