Remsons Industries Ltd — Q3 FY26

Remsons Industries Ltd Q3 FY2025-26 Earnings Conference Call https://www.youtube.com/watch?v=j6Q5SbRDsLE Published: 3 months ago

0:01 1 second Ladies and gentlemen, good day and welcome to Remson Industries Limited Q3 FI26 earnings conference call hosted by 0:09 9 seconds Go India Advisers LLP. As a reminder, all participant lines will be in the listenonly mode and there will be an 0:17 17 seconds opportunity for you to ask questions after the presentation concludes. Should you need assistance during this conference call, please signal an 0:25 25 seconds operator by pressing star then zero on your touchtone phone. Please note that this conference is being recorded. I now 0:33 33 seconds hand the conference over to Mr. Lina Shik from Go India Advisor LLP. Thank you and over to you. Good afternoon 0:41 41 seconds everyone and welcome to Ramson's Industries Limited Q3 and 9month FI26 earnings call hosted by Go India 0:48 48 seconds Advisors. We have on the call Mr. Rahul Krial wholetime director, Mr. Debendra Panda, CFO and Mr. Rohit Darji CS. We 0:56 56 seconds must remind you that the discussion on today's call may include certain forward-looking statements and must be therefore moved in conjunction with the 1:03 1 minute, 3 seconds risk that the company faces. We now request Mr. Rahul Krial to take us through the company's business outlook and performance after which we will open 1:11 1 minute, 11 seconds the floor for Q&A. Thank you and over to you sir. 1:17 1 minute, 17 seconds Thank you. Uh good afternoon everyone and welcome to the earnings call of Remil Industries Limited for our Q3 FI26 1:26 1 minute, 26 seconds results. I hope you've had the chance to review the investor presentation and financial results which are now 1:32 1 minute, 32 seconds available on the exchange. On this call, we will provide an overview of our financial and operational performance, 1:39 1 minute, 39 seconds discuss our strategy road map and outline our growth ambitions. 1:43 1 minute, 43 seconds At its core, Ramsson is built on a strong foundation. We are India's largest and one of the earliest manufacturers of control cables. 1:51 1 minute, 51 seconds However, the company today is very different from what it was even a few years ago. We are steadily transforming into a technology oriented mobility 2:00 2 minutes solutions provider with capabilities that now extend across the complete mobility value chain. This transformation which we refer to as 2:08 2 minutes, 8 seconds Remsonance 2.0 is already visible in our product mix, customer engagement and strategic investments. 2:16 2 minutes, 16 seconds Larger OEMs have reported higher volumes and rec record sales reflecting strong underlying demand. We maintain 2:24 2 minutes, 24 seconds long-standing partnerships with major OEMs in this space and as an EV agnostic partner are actively co collaborating with them on new product development. 2:35 2 minutes, 35 seconds Riding on this positive momentum from OENS, we are all positioned to benefit from improving demand conditions supported by a gradual recovery in rural 2:44 2 minutes, 44 seconds consumption, a strong pipeline of new launches, increasing prematurization, 2:51 2 minutes, 51 seconds higher disposable incomes and a growing preference for performance-led and fuel efficient vehicles. 2:58 2 minutes, 58 seconds Before turning to company specific performance, I would like to briefly touch upon the broader ind industry environment which continues to be supportive to the Indian auto and auto component sector. 3:09 3 minutes, 9 seconds The Indian auto ancillary industry is currently positioned in a favorable demand up cycle supported by steady OEM production, rising replacement demand 3:18 3 minutes, 18 seconds and increasing component content per vehicle. In FI25, the sector recorded an estimated turnover of uh rupees 6.7 lakh 3:26 3 minutes, 26 seconds cr with an export of USD 23 billion highlighting India's growth importance in the global automotive supply chain. 3:35 3 minutes, 35 seconds Industry growth is expected to sustain a 7 to 9% over the medium-term driven not just by volumes but also by higher value added content. 3:44 3 minutes, 44 seconds A key structural driver remains electrification. 3:47 3 minutes, 47 seconds EVs typically require higher electronic control, lighting and precision engineered components compared to ICE 3:54 3 minutes, 54 seconds vehicles resulting in higher content per vehicle. 3:58 3 minutes, 58 seconds Alongside EV's increased adoption of safety, emission and control features is enabling component suppliers to grow 4:06 4 minutes, 6 seconds faster than underlying vehicle production. 4:10 4 minutes, 10 seconds The policy environment remains supportive. Government initiatives such as the expanded real life scheme, localization incentives and 4:17 4 minutes, 17 seconds infrastructure growth are encouraging capacity expansion and technology investments across the sector. These measures are accelerating the industry's 4:26 4 minutes, 26 seconds transition from conventional manufacturing to advanced exportoriented engineering solutions. 4:33 4 minutes, 33 seconds From a g global perspective, a recent development has been the India US agreement to reduce tariffs on select auto components from 50% to 18%. 4:43 4 minutes, 43 seconds This is a very meaningful positive for uh Indian auto component exporters as the US remains one of the largest energy 4:50 4 minutes, 50 seconds export markets. The tariff reduction materially improves price competitiveness, enhances margin 4:58 4 minutes, 58 seconds potential and strengthens India positioning as a preferred sourcing destination for global OEM and Taiwan suppliers. 5:05 5 minutes, 5 seconds Overall, the combination of demand upcycle, rising content per vehicle, supportive policy measures and improving uh global trade dynamics provides a 5:14 5 minutes, 14 seconds strong and durable growth backup for the import uh Indian autocillary sector. 5:21 5 minutes, 21 seconds Turning briefly to the policy environment budget provided a supportive backdrop for the auto and auto component sector particularly in the content of 5:28 5 minutes, 28 seconds electrification and infrastructure growth. 5:34 5 minutes, 34 seconds From our from a product standpoint, Remson is well positioned to benefit from these shifts. Our expertise across control cables, jacks, winches, and 5:43 5 minutes, 43 seconds pedal boxes enable us to capture higher content per vehicle as OEMs uh increased feature intensity and platform 5:50 5 minutes, 50 seconds complexity. With India continuing to be the world's largest two-heer market and sport volumes beginning to show signs of 5:57 5 minutes, 57 seconds recovery, we are seeing meaningful opportunities to deepen our presence in both domestic markets and key export jobs. 6:06 6 minutes, 6 seconds Coming to the key updates for the quarter. During Q3 FI26, we continue to strengthen our growth uh through a 6:14 6 minutes, 14 seconds combination of capacity planning and fresh order winds. As part of our expansion road map, we identified an 6:21 6 minutes, 21 seconds additional 20,000 ft of land in the NCR region which would support uh future capacity augmentation and long-term initiatives. 6:31 6 minutes, 31 seconds On the order front, we received a 60 cr order from a leading um Indian commercial vehicle OEM, a for supply of 6:38 6 minutes, 38 seconds gear shifters and pushpull cables. This order is uh scheduled commence Q1 F1 FI27 and will be executed over a 5-year 6:46 6 minutes, 46 seconds period providing strong uh long-term revenue visibility in the domestic series segment. 6:53 6 minutes, 53 seconds Beyond the quarter, progress across our three strategic initiatives remains on track. Execution of the 300 plus cr 7:01 7 minutes, 1 second multi-year Stalantis contract in North America is proceeding as planned with supply set to begin from the next financial year across smart cars, Jeep models and the three-heer segment. 7:14 7 minutes, 14 seconds A newly commissioned 30,000 square ft² locomotive manufacturing facility at Chaken is progressing as per planned and 7:22 7 minutes, 22 seconds marks a meaningful expansion of our capabilities into regulations. 7:27 7 minutes, 27 seconds In terms of global order execution, we continues to see uh uh steady progress across the portfolio. 7:35 7 minutes, 35 seconds The 12 cr B lighting order from a German OEM is under active execution while the 7:42 7 minutes, 42 seconds 3 crore EGS sensor from another German OEM remains on track to December 2025. 7:49 7 minutes, 49 seconds On the international front, a technical license agreement also automotive in Brazil is progressing smoothly giving us insight into the Brazil domestic uh 7:58 7 minutes, 58 seconds after automotive OEM and aftermarket and uh we are trying to figure out our inroads into them. uh through our technology partners. 8:07 8 minutes, 7 seconds Collectively, these initiative reflect our continued diversification across railways, electric, mobility and lighting while reinforcing a focus on 8:15 8 minutes, 15 seconds primarilization and exports. Its exports contributing 33% of Q3 sales. We remain well positioned to deliver a 20 plus uh 8:24 8 minutes, 24 seconds caggr as well as progress towards our 900 to,000 cr revenue target for FI29. 8:30 8 minutes, 30 seconds To sum up, FI26 is shaping up to be a pivotal year for Mson with strong early momentum supported by large order of 8:37 8 minutes, 37 seconds wins, deeper global engagement and steady uh across new verticles. Our recent initiatives underscore the 8:46 8 minutes, 46 seconds strength of our strategy to diversify intelligently, scale internationally and stay closely aligned with the evolving mobility landscape in line with the Remsonance 2.0 road map. 9:00 9 minutes With these drivers in place, we are confident of steadyastly improving profitability and expanding IBITA 9:07 9 minutes, 7 seconds margins to a 13 to 14% range while maintaining a focus on long-term sustainable value creation. 9:14 9 minutes, 14 seconds On the financial front, on a consolidated basis, revenue from operations for Q3 FI26 stood at um INR23 9:23 9 minutes, 23 seconds crores, registering a healthy year-on-year growth of 20%. ITA margins for the quarter were at 12%. While a 9:31 9 minutes, 31 seconds profit after tax delivered a margin of approximately 4%. 9:35 9 minutes, 35 seconds Revenue at 9 months um FI26 consolidated stood at 338 crores, a 25% growth year 9:43 9 minutes, 43 seconds on year with the margins of 11%. And partner margins of 4%. 9:50 9 minutes, 50 seconds Despite our continued expansion in new business segments and ongoing capex uh commitments towards capacity augmentation, 9:58 9 minutes, 58 seconds our new product launches, we have maintained a strong and disciplined balance sheet. Our net uh debt equity uh 10:05 10 minutes, 5 seconds remains comfortable at 63x and we remain committed to operating within this leverage going forward. 10:12 10 minutes, 12 seconds With that, I would uh like to conclude my remarks and open the floor for questions. 10:20 10 minutes, 20 seconds Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press 10:27 10 minutes, 27 seconds star and one on their touchstone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are 10:37 10 minutes, 37 seconds requested to use handsets while asking a question. Ladies and gentlemen, we'll wait for a moment while the question queue assembles. 10:50 10 minutes, 50 seconds Our first question comes from the line of Dasha from Sapphire Capital. Please go ahead. 10:58 10 minutes, 58 seconds Hello. Am I audible sir? Yes. 11:04 11 minutes, 4 seconds Yes. Thank you so much for this opportunity. So firstly sir on the Stantis order you mentioned that the supply is expected to begin from the next quarter. What sort of revenue are 11:12 11 minutes, 12 seconds we uh expecting in FY27 and how would this ramp up be for this execution of this order? 11:19 11 minutes, 19 seconds Uh which uh which one are you talking about? The Stellantis order. 11:24 11 minutes, 24 seconds Yeah. So this will commence from Q2 of um FI uh for the for this financial year 11:31 11 minutes, 31 seconds and we see about uh maybe uh 15 to 20 crores of it metalizing in this financial year 11:38 11 minutes, 38 seconds and then going ahead what so this is going to be the uh no so this is this is on a half yearly basis so going forward uh next 11:47 11 minutes, 47 seconds year it will be about a 40 to 50 cr uh annual um run rate yeah that's yeah that's what I meant so 40 35 cr annual rankage right? 11:56 11 minutes, 56 seconds Yeah. Yeah. 11:58 11 minutes, 58 seconds Okay. And so just so we've seen margin improvement quarter on quarter and that is with this product mix evolving we see the value added share increasing. So 12:07 12 minutes, 7 seconds what sort of target you have for value added versus this commodity product for FI27 and going ahead and where would you 12:14 12 minutes, 14 seconds like to see this number say by FI? 12:19 12 minutes, 19 seconds Yeah. So like I I said you know we will see an uh overall we want to see an IIDA of over 13 to 14%. Now that will be a 12:26 12 minutes, 26 seconds journey uh over the next two or three years because already although we are changing the product mix it's not going 12:32 12 minutes, 32 seconds to be so drastically changing uh you know every year. So the legacy products with the uh commodity products is still 12:40 12 minutes, 40 seconds the largest uh pie and we're know slowly looking to uh move from there or you know enhance productivity and enhance 12:49 12 minutes, 49 seconds profitability from there as well. So like I said you know on a uh two or three year basis we'll see 13 to 14%. 12:58 12 minutes, 58 seconds Okay 13 to 14% embit. Okay. And so just for the export and the domestic mix I think this quarter for this nine months 13:05 13 minutes, 5 seconds it was around 23 to 67%. Where do we see this mix heading towards given the trade deals and the tariff announcement? How 13:14 13 minutes, 14 seconds do you read the overall export environment? 13:17 13 minutes, 17 seconds So from a percentage standpoint we are growing both domestically and exports. 13:21 13 minutes, 21 seconds So uh you know uh it it will not be that just we are growing in one sector. So the percentages may not change so drastically or you know convergently but 13:29 13 minutes, 29 seconds the the numbers in both the export and the domestics both will increase uh simultaneously. 13:35 13 minutes, 35 seconds So this this sort of share we can see to we can maintain this sort of share right absolutely absolutely 40 60 13:44 13 minutes, 44 seconds yeah 30 yeah yeah yeah and just on the cape so for this NCR what sort of capeex are we 13:50 13 minutes, 50 seconds planning uh right now uh for which for the uh capacity the for the capacity expansion 13:59 13 minutes, 59 seconds that we're putting right yeah so that will not be a very large cex uh it will somewhere close to about uh 3 to 4 crores. 14:09 14 minutes, 9 seconds Okay. And what's what was how much have we done till now the KPO this year? 14:15 14 minutes, 15 seconds I think we've done about 15 to 19 crores so far. 14:19 14 minutes, 19 seconds And what are we planning this year? And we are we planning some more in this year? 14:24 14 minutes, 24 seconds A little more. Uh we have just about one and a half months to go. But I think the one and a half months will take at least uh five to seven crores or more of K. 14:33 14 minutes, 33 seconds And so for the next year any sort of guidance you have for the cape number? 14:38 14 minutes, 38 seconds We are still formulating that but it should be close to uh anywhere 20 crores plus 20 cr plus. 14:47 14 minutes, 47 seconds Yeah. 14:48 14 minutes, 48 seconds Okay. Okay. And so just on the last question from my side on the Brazilian partnership what sort of revenue potential you see here? What sort of 14:55 14 minutes, 55 seconds margins? What sort of synergy benefits are you seeing here? If you could just elaborate a bit on that. 15:00 15 minutes So right now we are studying the markets. We are we are quoting for programs which will be in uh you know delivered uh within Brazil um right now 15:10 15 minutes, 10 seconds uh at so it'll be not at a very very some superlatively high margins but at least it'll bring us inroads into uh the market which is urging for us at this 15:19 15 minutes, 19 seconds point of time. Um so it however it will take about a year year and a half before we see some actual deliveries happening into that market. uh the waters are 15:28 15 minutes, 28 seconds being tested at this point of time and uh even our collaboration is you know being put to the best case scenario you as to what is the best scenario are we 15:36 15 minutes, 36 seconds supposed to export from India are we supposed to do a hybrid between export and some part of it made there or should we make it there you know everything is 15:44 15 minutes, 44 seconds being uh is open and on the table right now but any sort of number you like to put on the size of the opportunities you 15:51 15 minutes, 51 seconds not not at the moment okay not at the moment maybe after about 3 months I should be able to put some numbers. 15:58 15 minutes, 58 seconds Sure. Sure. Thank you so much and all the best. 16:03 16 minutes, 3 seconds Thank you. A reminder to all the participants, if you wish to ask questions, you may press star and one at this time. 16:12 16 minutes, 12 seconds Our next question comes from the line of Sham Sat from MSA Capital Partners. Please go ahead. 16:20 16 minutes, 20 seconds Hello sir, good afternoon. Uh firstly, congratulations on a good set of numbers. uh I wanted to understand first 16:27 16 minutes, 27 seconds sir on our current asset base um what is the level of revenue further that we can achieve and for our future goal of the 16:35 16 minutes, 35 seconds 900 to,000 crores of revenue that we're targeting by FI29 what capex do we plan 16:41 16 minutes, 41 seconds to uh do additional for that so on our current asset base we will be 16:50 16 minutes, 50 seconds able to get a fair bit of revenue in the sense uh I think reaching about 600 100 to 650 crores with minimum. So it's not 16:58 16 minutes, 58 seconds uh the current asset base will deliver all that. So incremental uh capexes will need to be done to the current asset base also to achieve this. So as far as 17:06 17 minutes, 6 seconds the 900 to,000 cr revenue is there we already put up bulletin saying that 100 cr of investment would be required in there and we maintain that you know 17:14 17 minutes, 14 seconds which also includes inorganic uh acquisitions uh on our way to achieve that journey. 17:21 17 minutes, 21 seconds Okay. So 100 crores with which includes uh inorganic acquisitions and capeex to achieve 900 to,000 crores by 29. Okay. 17:29 17 minutes, 29 seconds Yes. 17:31 17 minutes, 31 seconds Okay sir. Sir and um can you give a rough split of how much you're targeting for the organic and inorganic uh to achieve this uh 900,000 crores figure? 17:41 17 minutes, 41 seconds Um like how much is dependent on acquisitions that future? uh uh maybe about 150 to 200 rows will depend on uh 17:50 17 minutes, 50 seconds acquisitions and the rest uh 800 to 850 would be through organic uh growth. 17:57 17 minutes, 57 seconds Okay. All right. All right sir. Sir and how do we look at our margin expansion plan? Are we uh trying to continue fuh 18:05 18 minutes, 5 seconds focusing on getting uh better uh like orders from better customers or do you want to also get into backward integration going up the value chain or 18:13 18 minutes, 13 seconds in some other way to expand margins? No, we are doing we are doing forward integration. We are adding uh um systems 18:20 18 minutes, 20 seconds uh rather than components, you know. So, and we are trying to do products that are 18:27 18 minutes, 27 seconds technology mode driven and uh have low entry barriers uh high entry barriers actually. So, that way we are trying to 18:35 18 minutes, 35 seconds expand our uh uh margins with a little bit of a change in our product portfolio. 18:42 18 minutes, 42 seconds Sorry sir, I didn't get the last bit. 18:44 18 minutes, 44 seconds Could you repeat that change in something? Uh we are trying to do a little bit of a change in our product portfolio to add value added product and 18:52 18 minutes, 52 seconds go up to the value chain by adding system supplies rather than component supplies. 18:57 18 minutes, 57 seconds Okay. Okay sir. Got it sir. And uh with the geographies that we deal with right uh we have be lighting in UK uh we have 19:07 19 minutes, 7 seconds uni autonomics we have aircom da. So uh these are all different uh like diverse geographies. So I just wanted to 19:14 19 minutes, 14 seconds understand what challenges could we face uh to you know what roadblocks might we 19:20 19 minutes, 20 seconds face to operate efficiently and without compromising on our focus on the core product portfolio? 19:30 19 minutes, 30 seconds No no whether it is aircom or they are based for js out of India. So we are uh we are dealing with a single geography of India as far as we are concerned 19:39 19 minutes, 39 seconds automation is India based. So this is geography single we have two units in the UK and we are exporting to different geographies like uh UK, Mexico, uh 19:48 19 minutes, 48 seconds Canada, North America and uh you know Brazil also currently also so uh from a geography uh our exports are more into these different geographies. 19:59 19 minutes, 59 seconds Manufacturing these are just basically India and the UK. Okay sir. Understood. Understood. 20:06 20 minutes, 6 seconds Understood. Sir, and with the uh capeex plan of 100 crores that you mentioned, right? Um how do we view our uh net debt 20:14 20 minutes, 14 seconds trajectory for the future? Uh do we see any more leveraging a balance sheet? 20:19 20 minutes, 19 seconds Uh no not much. Uh there are different ways of raising capital. We are looking at them. We intend to debt equity ratio 20:27 20 minutes, 27 seconds to uh between 6 and8 going forward. 20:33 20 minutes, 33 seconds Okay. Okay sir. Sir and with the 12th cr order for be lighting uh are we what 20:41 20 minutes, 41 seconds strategy are we looking at? Do we want to be specialized in the design and engineering uh field or do we want to uh set a full scale lighting manufacturing uh in India? 20:53 20 minutes, 53 seconds No. So this is not for India. This is for uh German uh auto OEM uh from our UK facility. This is the first order into 21:01 21 minutes, 1 second design. The second and you know once they're satisfied with that the second and third could be into low low volume manufacturing along with the design. So 21:09 21 minutes, 9 seconds we are trying to slowly progress. Um so we already have the uh low volume manufacturing. We do not intend to get into high volume manufacturing but low 21:17 21 minutes, 17 seconds and medium volume is where is our sweet spot uh from that location. 21:23 21 minutes, 23 seconds A high margin low and medium volume manufacturing. 21:26 21 minutes, 26 seconds Okay. Understood. So my last question is uh with the 30,000 square ft² facility that we have for railway applications 21:34 21 minutes, 34 seconds um I believe the contracts over there are uh usually longer payment cycles. So do we expect any structural shift in our working capital days for that? 21:44 21 minutes, 44 seconds Uh no because it will be a mix between private and public enterprise. So uh on the private team we generally work on uh 21:52 21 minutes, 52 seconds advance or you know uh within the 30-day payment size of term as for the uh public is concerned uh on the if it's the direct tendering to the railway the 22:00 22 minutes payments are secured you know so we can always discount them and uh keep our working cycle content the same. 22:08 22 minutes, 8 seconds Okay understood sir thank you so much and all the best. 22:14 22 minutes, 14 seconds Thank you. Our next question comes from the line of Kumar Sor from Scientific Investing. Please go ahead. 22:24 22 minutes, 24 seconds Uh hello am I audible? Yes. Yes, you're audible. Hello. Am I audible? Yes, I can hear. 22:31 22 minutes, 31 seconds Yes. Yes. So, congratulations on Yeah, congratulations on good set of numbers. 22:36 22 minutes, 36 seconds Uh I have few questions. Uh first one observation sir in the investor PPT slide five and slide six. uh in one 22:44 22 minutes, 44 seconds slide it's mentioned our uh 900 revenue target in FY30 and another it's mentioned FY29 I know businesses are not 22:53 22 minutes, 53 seconds standard uh don't run in that way but still uh is it FY29 or FY30 if you can just 23:00 23 minutes confirm again it's between FI29 and FI30 somewhere we've not so I mean it's not something 23:09 23 minutes, 9 seconds in stone I mean I mean it's the future we don't uh we can't look so much forward but somewhere between FI 29 but mostly FI30 doesn't should be there. 23:19 23 minutes, 19 seconds Got it. Got it. Got it. Uh next question sir on the Astro motor uh I think uh in one of the presentations you have 23:26 23 minutes, 26 seconds mentioned about FY31 or 33 market size opportunity 30,000 cr plus uh but I think astro motor products are on B2B. 23:34 23 minutes, 34 seconds So uh few questions on the B if you can elaborate a little bit on what is your you know vision on this business in terms of what kind of what is the 23:42 23 minutes, 42 seconds relevant TAM what kind of market share we want to have over four five years and what is our current revenue margin and how do you see scaling up in the long 23:49 23 minutes, 49 seconds term if you can give some qualitative and data insights of uh that business is concerned I would rather give a little more guidance in 23:57 23 minutes, 57 seconds the next call rather than this call uh sure sure and Third question sir on 24:04 24 minutes, 4 seconds the muggle cables last year has not been good. So how are things going on right now and uh how do you see FY27 playing out? Sorry, which cables? 24:16 24 minutes, 16 seconds Uh, muggle cables. The UK acquisition we have done in 2020. 24:22 24 minutes, 22 seconds Right. So, um, so this year should be stable. Uh, we should do not expect a high growth. Some of the programs 24:30 24 minutes, 30 seconds specifically in the global EV sector uh has been uh which businesses were awarded to us but 24:38 24 minutes, 38 seconds they're looking to compensate that by awarding some more business. So which discussions are going on? Uh so which so we are looking at a stable um 24:48 24 minutes, 48 seconds size right now. Uh growth would come in u within the next after after this coming year next year 24:58 24 minutes, 58 seconds because apart from the cables we also we also looking at closing some other businesses for the unit which will all start from 28. 25:09 25 minutes, 9 seconds Got it. Got it. And the last question uh quite a few occasions which we have done it's in Europe and usually when we see 25:16 25 minutes, 16 seconds the European automotive industry is not doing well and despite of that if we see basically our growth business has done very very well uh which is really 25:24 25 minutes, 24 seconds commendable but do you see any future risk on the you know all these acquired companies in the European market given how European autocycle is going on. Most 25:33 25 minutes, 33 seconds of our sales is not in Europe, it's outside Europe, it's in the US, Mexico, Canada region. A few a bit of sales is in Europe. So that way we are secured. 25:42 25 minutes, 42 seconds Even though the European sector is a little slow, uh our uh basic uh sales is outside Europe. Uh like you know for 25:50 25 minutes, 50 seconds example when we had the GLR cyber attack, the plant was shut for almost 3 to 5 months. It did affect uh that the turnover and the thing. since we were 25:59 25 minutes, 59 seconds you know protected with the uh US sales and uh UK already had the first uh treaty with the US so that did not affect us in any way. 26:10 26 minutes, 10 seconds Uh sure that's all I had sir. Wish you all the best. Thank you. Yeah. Thank you. 26:16 26 minutes, 16 seconds Thank you. Our next question comes from the line of Chiak Sha from Whiteine Investment Management. Please go ahead. 26:25 26 minutes, 25 seconds Yeah, thank you for this opportunity. uh Rahul two questions one this Indo uh 26:32 26 minutes, 32 seconds India US uh treaty that has been done so can you just share some light on what 26:38 26 minutes, 38 seconds products of our portfolio we stand at an advantage because it's largely versus 26:46 26 minutes, 46 seconds China is a competitor to our products then we have a real advantage is this the understanding correct and which are 26:53 26 minutes, 53 seconds products from our portfolio where there is an advantage And related to that are there any discussions that were already 27:01 27 minutes, 1 second going on with the US customers or we will have to start it a fresh now on that side? 27:11 27 minutes, 11 seconds No. So um China is a competition for most of the uh suppliers globally but we also face competition from the local 27:20 27 minutes, 20 seconds manufacturers in the US and uh you know all all the other global customers as well. However, for as far the US is 27:27 27 minutes, 27 seconds concerned, um we had one significant amount of businesses from there before the tariffs were put in place. Okay. 27:34 27 minutes, 34 seconds None of the contracts were renegotiated. 27:36 27 minutes, 36 seconds It continued to be the same. And with the tariffs uh you know uh getting abolished right now uh it's it's a plus. 27:45 27 minutes, 45 seconds Uh we don't need to worry about that so much now. uh and uh our supplies will be starting uh uh you know quarter two of 27:54 27 minutes, 54 seconds uh this year. So right now as after winning the business we went into development phase. However we will so 28:02 28 minutes, 2 seconds because of the tariffs a lot of uh new inquiries were put um kind of on hold which will start flowing in now. So you 28:11 28 minutes, 11 seconds know uh the next uh year and the year after that all the future inquiries will it will definitely give a boost to that 28:18 28 minutes, 18 seconds but it did not affect any of our businesses that we were doing or we hand uh materialized with the US. 28:26 28 minutes, 26 seconds So what products uh if you can help uh summarize for it would be helpful. What products we export to US today of of our 28:34 28 minutes, 34 seconds portfolio? What all things get exported to us? From India? Cable. Cables. 28:39 28 minutes, 39 seconds Cables. Right. Only cables. Nothing else. Yes. 28:42 28 minutes, 42 seconds And any thought process of entering into making lightings in India and then exporting to US or not required because 28:50 28 minutes, 50 seconds the duty is 10% between UK and US. So if at all UK would be used as a base yes it's better to supply it from there 28:59 28 minutes, 59 seconds at this point of time rather than incur a capex of investing into here setting up a plant and looking to invest you know all your supplier network 29:07 29 minutes, 7 seconds everything has to be redeveloped okay uh it's not going to add any value uh at this point of time and you are saying in control cables for 29:15 29 minutes, 15 seconds us China is a competitor in US always it's always been or not really no okay let me rephrase is 29:23 29 minutes, 23 seconds China has a big share in export of control cable to either US or Mexico or their share is not that significant. No, they have a very big share. 29:32 29 minutes, 32 seconds They have a big they have a very big share. So wherever we win the business, we are eating into their share of business. 29:37 29 minutes, 37 seconds Okay, this is helpful. Uh uh and would you like to call out the number of 29:44 29 minutes, 44 seconds customers with whom there were inquiries coming across? three, four, five customers before the tariff issue came across RFQS or something like that. 29:54 29 minutes, 54 seconds Not at this point of time. Uh because those customers again you will restart to engage correct the customers before the Yes. Yes. True. But I would not like to 30:02 30 minutes, 2 seconds put names on the board right now. Not some some qualitative number whether it is one customer existing customer or 30:10 30 minutes, 10 seconds there are more customers that two three two or three customer uh the value could be in the terms of 40 to 50 crores annually. 30:19 30 minutes, 19 seconds Okay. So there were between two and three customers. 30:23 30 minutes, 23 seconds Okay. And last question from my side assuming that this ABS regulation which 30:29 30 minutes, 29 seconds is hanging if it if it comes if it comes I'm not will come all right if it comes right what is the impact on our console 30:38 30 minutes, 38 seconds revenue is it 5 7% of our console revenue gets affected because of that uh on the console revenue about uh you 30:45 30 minutes, 45 seconds could say 8% will get affected 8% will get affected and is there an alternate solution for to or not really? 30:56 30 minutes, 56 seconds No, we've already factored in that in our approach and uh you know our projections are made with as if you know that's already been implemented. So we 31:04 31 minutes, 4 seconds are already factoring in that u if it comes in if it doesn't come in it'll be a boost for us. 31:10 31 minutes, 10 seconds Okay. And in your assessment when do you think it is like because it has already got delayed. So when do you think the 31:18 31 minutes, 18 seconds next possible date next possible date your guess will be better than ours? 31:23 31 minutes, 23 seconds No I don't I don't know we we we keep asking the OEMs when is your next meeting on this and the meeting is also delayed so we really don't know what the 31:32 31 minutes, 32 seconds behind the scenes uh is happening you know uh because it is a very sensitive topic and uh no one wants to uh give any 31:39 31 minutes, 39 seconds uh you know dates or something to us you know. Okay, great. This is they have a risk of risk of the the 31:48 31 minutes, 48 seconds suppliers behaving differently after they give some names you know. 31:51 31 minutes, 51 seconds They they rather restrained from doing anything. 31:54 31 minutes, 54 seconds And on the railways would you for the railways part of the not the private part of business but the railway part of business the government part of the business 32:02 32 minutes, 2 seconds you will require this RDSO approval right or you will not be requiring yes you will you will need that 100% require even for the private sector 32:10 32 minutes, 10 seconds to be able to supply to the private sector you will require that approval. So that process takes how much time in your in your assessment? 32:18 32 minutes, 18 seconds Uh assuming the product is ready today. 32:20 32 minutes, 20 seconds If assuming the product is ready today then how much time it takes? 32:24 32 minutes, 24 seconds So certain products require field trial and certain products don't require feed trial. So the ones that don't require field trial no still it has to go 32:32 32 minutes, 32 seconds through a process of uh observation which is about a 30 to 90 period um observation cycle and the ones which 32:40 32 minutes, 40 seconds require field trials could be anywhere between 6 months to a year for field trial a year. 32:45 32 minutes, 45 seconds So we have got various products uh which are not requiring field trial and some of which are requiring field trial. So you know when we plan for the long term 32:53 32 minutes, 53 seconds we are planning uh whatever products we plan is a mix of both certain RDS of rules have already been initiated and we are halfway through them already. 33:02 33 minutes, 2 seconds Okay great okay thank you and all the best. 33:07 33 minutes, 7 seconds Thank you. Our next question comes from the line of Atar Sayyad from Smart Sync Services. Please go ahead. 33:21 33 minutes, 21 seconds Mr. Say, your line has been unmuted. Please go ahead with your question. Uh, hello. 33:30 33 minutes, 30 seconds Yes, you're good afternoon sir. 33:33 33 minutes, 33 seconds Uh, hello sir. I to know about the order book. How much order book do we have as of now? And how much order do we have in our pipeline? 33:48 33 minutes, 48 seconds So our order book would be at least uh 500 crores at this point of time and in the pipeline we would be having at least 33:57 33 minutes, 57 seconds uh order for about 800 to 900 crores. I mean it's a very difficult in this industry which is a continuously uh uh 34:04 34 minutes, 4 seconds it's not like a order wins for us you know we work on a schedule basis we win the business and every year the schedules uh come in so like I said we 34:14 34 minutes, 14 seconds have 500 rows of order at this point of time and on the pipeline if you see the next two or three years we have about 34:20 34 minutes, 20 seconds 800 900 crores of right now we have uh how much in the pipeline 34:29 34 minutes, 29 seconds 500 crores Can you please throw some light on uh 34:36 34 minutes, 36 seconds how our receivable dates works like a credit period and all? 34:43 34 minutes, 43 seconds I will refer this to uh my team 34:52 34 minutes, 52 seconds for all the OEMs we maintain the I mean receivable days at uh I mean 60 days it's a comment cycle for all the OEMs. 35:00 35 minutes So basically our uh receivable days is see the balance sheet also it comes from 55 to 56 days on an average. 35:13 35 minutes, 13 seconds Okay. Okay sir. Got it. Thank you. Thank you sir. Okay. 35:18 35 minutes, 18 seconds Thank you. Our next question comes from the line of Ronat Kapoor from Investor Investments. Please go ahead. 35:28 35 minutes, 28 seconds Yeah. Uh I thanks for the opportunity and congratulations on a good set of numbers. So uh my first question is uh 35:36 35 minutes, 36 seconds regarding Mexico increasing uh the tariffs on auto anchor rates. So I want to know what is our exposure to Mexico and how will this affect us as such. 35:46 35 minutes, 46 seconds So we don't have any direct exposure to Mexico. Uh so uh it doesn't affect us in any way. uh we have our exposure to mix have such traers on it. 36:00 36 minutes Okay. And uh secondly I want to know is uh now with the EU FDA being finalized how is the RFQ and inquiries and the new 36:08 36 minutes, 8 seconds order inflow is expected to increase from there like can you give a ballpark number regarding that? 36:13 36 minutes, 13 seconds No because it is just being signed. uh we are yet to find out from uh the industry what they feel about it and it's not going to drastically you know 36:22 36 minutes, 22 seconds suddenly some floodgates are going to open. It's not going to work like that. 36:27 36 minutes, 27 seconds Looks uh because you know everybody has different suppliers. No one wants to change just because of one policy being signed because you seen a policy can be 36:36 36 minutes, 36 seconds signed it can be changed it can be additional tariffs can be put at any point of time. So no one wants to take major actions. So like although it's a 36:43 36 minutes, 43 seconds good thing for us but it'll be within the next 3 to 6 months where things will really unfold. 36:50 36 minutes, 50 seconds Okay. And uh thirdly I want to know is uh regarding you are planning one more acquisition. So uh which uh geographies 36:58 36 minutes, 58 seconds are you looking at and which uh specific uh subsegments are you looking at and any how much uh amount are you uh putting on hold for that acquisition? 37:12 37 minutes, 12 seconds uh the open right now which will give us the best value for product uh and gives us a uh you know position globally with 37:19 37 minutes, 19 seconds that product. uh we we are putting aside about uh 60 to 70 crores for that acquisition. 50 maybe between 50 to 70 37:27 37 minutes, 27 seconds cr and any specific geography like no we are open right now we're seeing which will give us the best um you know 37:36 37 minutes, 36 seconds value for money in terms of um ROI as well as the product and the uh the 37:44 37 minutes, 44 seconds product should be you know fit in different geographies and not just one geography. So any range of products are you looking at like can you just give a example like two three product ranges as such like? 37:57 37 minutes, 57 seconds No actually we've kept ourselves pretty open as you can see from our past acquisition also it's been uh completely uh u non relatable products also. So 38:06 38 minutes, 6 seconds we've kept ourselves pretty open. We just you know we're open to evaluate uh various products. So people are coming up with various opportunities and you know they're under evaluation right now. 38:15 38 minutes, 15 seconds So it' be too early to give any uh answer right now on that. 38:21 38 minutes, 21 seconds Okay. And uh then regarding Astro Motors, I I believe the company has canled the acquisition of the remaining stakes. So what is the future plan 38:29 38 minutes, 29 seconds regarding that because question was asked before also and I said I would be in a better position to 38:36 38 minutes, 36 seconds answer this in the next uh call because there are certain strategies we are underplaying for this. Uh so right now I 38:44 38 minutes, 44 seconds would rather refrain from answering any questions on that and keep it for the next call. 38:49 38 minutes, 49 seconds Okay. Yeah. And lastly, what is the guidance are you looking at for FI27? 38:56 38 minutes, 56 seconds Uh FI27 in terms of uh numbers consolidated revenue. 39:04 39 minutes, 4 seconds um somewhere between um uh 520 to 570 crores somewhere between that. 39:12 39 minutes, 12 seconds Okay. And uh the margin would be steadily improving like it won't uh go to 14% 11 and 12% it should go by next year. 39:20 39 minutes, 20 seconds Yes. Yes. Some somewhere. Yeah. Steadily it won't jump it will be on a steady increase. 39:26 39 minutes, 26 seconds And this is considering the acquisition or without the acquisition because uh No, this is without the acquisition. 39:32 39 minutes, 32 seconds Okay. And the acquisition is uh how are you planning to fund it like because uh would you be diluting no more equity or like through depth like 39:40 39 minutes, 40 seconds we are we evaluating all options at this point of time maybe part uh equity part debt. 39:45 39 minutes, 45 seconds Okay. And this will be done at this year only or next year like uh it depends on the uh acquisition presented to us. It could be it could be 39:54 39 minutes, 54 seconds any time. It could be this year. It could be next year. It could be the year after that. You know it depends on the best opportunity that we get. Plus the markets also need to be supportive at 40:02 40 minutes, 2 seconds that point of the opportunity that we get. 40:06 40 minutes, 6 seconds Yes. Okay. Thank you. That's it for myself. 40:10 40 minutes, 10 seconds Thank you ladies and gentlemen. If you wish to ask a question, you may press star and one at this time. Our next 40:18 40 minutes, 18 seconds question comes from the line of Rohit Ori from Progressive Shares. Please go ahead. 40:24 40 minutes, 24 seconds Uh hi R couple of questions and some clarifications as well. uh first on the clarification in in September 25 we 40:33 40 minutes, 33 seconds mentioned about acquisition of uh 80,000 square ft area in NCR region and today we are talking about addition of uh 40:41 40 minutes, 41 seconds 20,000 more so so is it like is it combined 80 + 20 is that what is the correct number at NCR 40:51 40 minutes, 51 seconds no uh so we had we had not given a guidance on acquisition we had said that we're exploring and 80,000 ft² opportunity. 41:00 41 minutes Mhm. 41:00 41 minutes Uh however, with the uh industrial scenario and some change uh changes, we have bottled it down to 20,000 uh which 41:08 41 minutes, 8 seconds will suffice for the next year. However, we will be going with another 20,000 somewhere in the in the Pon region also. 41:15 41 minutes, 15 seconds So, it will be a total of 40,000 uh going forward. 41:19 41 minutes, 19 seconds Okay. Uh any thoughts on uh what would be the purpose? Are you looking at the EDS or maybe EV systems or some advanced 41:27 41 minutes, 27 seconds drivers or something? What exactly are you looking at? Or is it the customers or clients are asking you to establish 41:34 41 minutes, 34 seconds uh uh manufacturing unit closer to them or something like that? 41:39 41 minutes, 39 seconds No. Uh so our product doesn't require to be next to the uh next to the manufacturer. Okay. 41:43 41 minutes, 43 seconds But the order in which we already have the space requirement to service them uh is that that's where uh we need the space. 41:52 41 minutes, 52 seconds Mhm. Okay. Uh for the uh Brazil tech partnership, you mentioned that you're looking at some uh studying the market 41:59 41 minutes, 59 seconds and uh trying to get some inroads into the market, but will you be looking at some acquisition over there or anything of that sort any development on that 42:07 42 minutes, 7 seconds side? difficult difficult difficult for an acquisition because it's not the easiest of territories to work here uh with the labor laws and stuff you 42:14 42 minutes, 14 seconds know so we would rather stay on a TA basis uh or a you know uh have a partner over there to do the front end uh work 42:22 42 minutes, 22 seconds you know that's very fine uh next question on the railway side uh I I know we had some products in 42:31 42 minutes, 31 seconds the past but uh uh it uh it appears that you're working on some new products uh with some portfolio expansion. If you can take us through that uh that uh how 42:40 42 minutes, 40 seconds many such products are in pipeline and how many are intended to be uh launched maybe in the next uh six or eight quarters or something like that. 42:48 42 minutes, 48 seconds Yeah. So we already working on every components then we're working on flack adjusters and we're working on uh air reservoirs 42:55 42 minutes, 55 seconds uh in the pipeline as of now. Um every components are a multiple of about uh 8 to 10 parts that are going into it. The 43:02 43 minutes, 2 seconds CC audit has already been commenced for that. Slack adjust audit is will happen in the month of February and the error is res audit will happen in the month of 43:11 43 minutes, 11 seconds March. So uh by the time it goes into production it could be uh 6 to 8 months by the time you see them going into production. 43:19 43 minutes, 19 seconds Okay. And and does these uh products uh which are launched 8 to 10 do they limit us only to the domestic market or uh do 43:27 43 minutes, 27 seconds we have opportunities in the export market? 43:29 43 minutes, 29 seconds No. So there are opportunities export market as well. All these products are opportunities to the export market as well. We're already talking to uh 43:36 43 minutes, 36 seconds companies uh in this market but we're getting first uh our first primary objective is to get the RDS approval and get the product ready and then we will 43:44 43 minutes, 44 seconds you know take it uh more forcefully to the export market. 43:49 43 minutes, 49 seconds Any number or revenue projection that you anticipate which you'd like to share with us? 43:55 43 minutes, 55 seconds For the railway segment we should be talking anywhere between 25 to 35 cr this year. 43:59 43 minutes, 59 seconds Okay. Okay. My last question is uh uh related to the defense segment in uh Q4 F2. We mentioned that we were working 44:08 44 minutes, 8 seconds for some uh defense products or maybe developing something. If you can take us through that uh what sort of development 44:16 44 minutes, 16 seconds has happened over there or is it currently uh stagnant or some positive uh revenue generation it can happen from there? 44:26 44 minutes, 26 seconds So the all the projects that we worked on stands for a two-year uh frame before it comes into a production uh because there because you're not directly 44:34 44 minutes, 34 seconds working with the government office you're working with the larger defense the companies which are supplying as a whole vehicle that has been supplied to 44:41 44 minutes, 41 seconds the defense. So the vehicle architecture and the building and you know approvals and the testing that's a long drawn 44:48 44 minutes, 48 seconds process. So like earlier also I said it may not be very high revenue commensurative but it's a but you know uh we take solace in the fact that we're 44:57 44 minutes, 57 seconds doing something for the government and something good for for the uh for the people of the country. 45:03 45 minutes, 3 seconds Uh true cuz I also remember uh the prime minister visiting one of his stalls uh I think six or eight months ago uh in one 45:11 45 minutes, 11 seconds of the expos. So that's the reason why this question came up. 45:15 45 minutes, 15 seconds Correct. Correct. Correct. He was more in terms of atma bharat nan where we have demonstrated a lot of products that 45:22 45 minutes, 22 seconds we have brought from global technologies and domestic India. Mhm. 45:28 45 minutes, 28 seconds And in any numbers uh uh that could generate into revenues. 45:34 45 minutes, 34 seconds So we already generated some parts into revenue almost uh 10 to 15 CR uh in the last year 45:41 45 minutes, 41 seconds and uh we're looking to add more products uh from our global partners into India and do uh have it uh like you 45:49 45 minutes, 49 seconds know as with us okay Rahul that's all from my side all the very best and uh thank you for answering all the questions. Thanks a lot. 45:58 45 minutes, 58 seconds Thank you. 46:00 46 minutes Thank you. Our next question comes from the line of Anukul from Inve. Please go ahead. 46:07 46 minutes, 7 seconds Yeah. Hi sir, thanks for the opportunity and congratulation on a good set of numbers. So my first question uh is on the industry side like how is the growth 46:16 46 minutes, 16 seconds for IC engines versus the EV or hybrid side and how is it going to be over the next couple of years? 46:26 46 minutes, 26 seconds So the uh ICE engines is predominantly going to be the largest market share over the next 10 years. Also the uh EV 46:34 46 minutes, 34 seconds engines are going to be uh maybe over the next 10 years it could be 10 between uh 20% to 25% of the market share. uh as 46:44 46 minutes, 44 seconds far as the passenger cars are concerned uh on the uh two-heer side also we don't see a bigger than a 30% uh inroads into 46:52 46 minutes, 52 seconds the EV engines over the next five to six years at least. Uh so uh as we talked to OEMs uh they have asked us to continue 47:01 47 minutes, 1 second our investments into uh the ICE uh technology uh for different products as well and for the current products because but our products are pretty much agnostic to uh EV or IC. 47:16 47 minutes, 16 seconds All right sir. Got it. Got it. Nextly on the side like the guiding for a 900 crores 1,000 cr topline uh by 2930. So 47:26 47 minutes, 26 seconds what would be the mix uh through our legacy business versus our new age businesses? What would be the mix that we could uh get in for? 47:36 47 minutes, 36 seconds So I think uh 60% would still be the legacy business and 40% would be the new business. 47:44 47 minutes, 44 seconds Okay. And then the margins would be preferably on that front only because I think legacy business has lower margins compared to the new. So we doing a 47:52 47 minutes, 52 seconds little product mix changes uh in this business as well which will uh in turn give us higher margin uh going forward. 48:03 48 minutes, 3 seconds Understood. Got it. And lastly uh one last question on the railway side. How do you see it becoming uh like will it 48:12 48 minutes, 12 seconds be a meaningful contributor going forward in next uh five to six odd years or what it will be going forward? 48:20 48 minutes, 20 seconds Yeah, we seeing at least over the next 3 to four years the structure itself about 150 crores of revenue. 48:30 48 minutes, 30 seconds Okay, got it sir. Yeah, that's it from my thank you sir. Thank you. 48:36 48 minutes, 36 seconds As there are no further questions, I would now like to hand the conference over to management for closing comments. Over to you sir. 48:45 48 minutes, 45 seconds So um thank you everyone for joining this uh call and uh I hope I've been able to answer most of 48:52 48 minutes, 52 seconds the uh questions. I've tried to be most accurate and most honest in my answers. 48:58 48 minutes, 58 seconds So with that I would like to conclude my remarks and uh you know we can uh wait for our next uh phone call. 49:09 49 minutes, 9 seconds Thank you on behalf of Co-India Advisers LLP. That concludes this conference.