Syrma SGS Technology Limited — Q4 FY26

Syrma SGS Technology Ltd Q4 FY2025-26 Earnings Conference Call https://www.youtube.com/watch?v=jIHyBEqPMmE Published: 1 day ago

0:02 2 seconds Ladies and gentlemen, good day and welcome to Surma SGS Technology Limited's Q4 FY26 earnings conference 0:11 11 seconds call hosted by ICICI Security. As a reminder, all participant lines will be in the listenon mode and there will be 0:19 19 seconds an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an 0:28 28 seconds operator by pressing star then zero on your touchstone phone. Please note that this conference is being recorded. I now 0:35 35 seconds hand the conference over to Mr. Aneruda Jooshi from ICICI Securities. Thank you and over to you Mr. Jooshi. 0:44 44 seconds Yeah, thanks uh Michelle. Uh ICICI securities is pleased to invite you all to Q4 FI26 and FI26 results conference 0:53 53 seconds call of Serma SGS technology. We have with us today senior management team uh to attend the call. Uh I congratulate 1:01 1 minute, 1 second the management for posting strong set of numbers and now I hand over the call to Mr. Nikil Gupta head of investor relations to introduce the management 1:09 1 minute, 9 seconds and take the call forward. Thanks and over to you Nikil. 1:13 1 minute, 13 seconds Thank you Aner. Uh hi very good morning to all on behalf of Silma SGS family we welcome you all to Silma SGS quarter 4 1:21 1 minute, 21 seconds and fiscal year 2026 earnings call we have with us today Mr. JS Gujaratal managing director Mr. Jesh doshi 1:29 1 minute, 29 seconds director Mr. Satenda Singh chief executive officer and Mr. Vijay Agraal chief financial officer Silma IGS to discuss the performance of the company 1:37 1 minute, 37 seconds during the fourth quarter and fiscal year 2026 followed by detailed question and answer sessions. Kindly note during 1:45 1 minute, 45 seconds this call certain statements that will be made are forward-looking which involves several risks, uncertaintities, assumptions and other factors that can 1:53 1 minute, 53 seconds cause results to differ materially from those in such forward-looking statements. All forward-looking statements made a based on the 2:00 2 minutes information presently available to the management and to the company and the company does not undertake to update any forward-looking statements that may be 2:08 2 minutes, 8 seconds made during this call. In this regard, kindly review the disclaimer statements in the earnings release and all the other factors that can cause a 2:16 2 minutes, 16 seconds difference. With this, I will now hand over the call to Mr. JS Fijra, managing director SMA SGS. Thank you. 2:23 2 minutes, 23 seconds A very warm welcome ladies and gentlemen to the FY26 earning call of SIMGs technology limited. 2:36 2 minutes, 36 seconds When we sit back and sort of uh reflect on what has happened in a year gone by, it gives us a great sense of 2:44 2 minutes, 44 seconds satisfaction that we have achieved almost all the parameters or exceeded them uh what we had set for our sale uh at the start of the year. 2:56 2 minutes, 56 seconds Just to recolct we had started off the year with a guidance of about 400 plus crores of 3:03 3 minutes, 3 seconds AITA margin uh AITA figures a revenue growth of about 30 to 35%. 3:09 3 minutes, 9 seconds And a positive cash flow with exports targeted to cross the 1100 cr. So these were the four five were 3:17 3 minutes, 17 seconds sort of set of parameters which we had set for ourself and when we look at the figures for the year gone by but it 3:26 3 minutes, 26 seconds gives a great set of sense of satisfaction that we have achieved uh a beta of 545 3:34 3 minutes, 34 seconds crores. Even if we exclude the elcom a beta it still stands at 490 plus crores. 3:41 3 minutes, 41 seconds So against the original start guidance of 400 to 490 crores of operating a bit 3:49 3 minutes, 49 seconds exports we had targeted 1100 crores we are at 1200 plus cring 3:57 3 minutes, 57 seconds capital cycle we had said that we'll endeavor to bring it down and we have brought it down from 69 days to 63 days 4:06 4 minutes, 6 seconds x elcom the speaker is at 58 days all this has enabled abled us to generate a 4:13 4 minutes, 13 seconds positive cash flow operating cash flow of 290 plus crores which is almost at 4:20 4 minutes, 20 seconds 53% of the operating a bit. So all these four parameters we have sort of exceeded what we had guided the market. 4:33 4 minutes, 33 seconds If I was to sort of exclude consumer business from our sort of portfolio 4:41 4 minutes, 41 seconds because consumer is a low margin business and there's a conscious effort of the management to sustain it at a 4:47 4 minutes, 47 seconds certain level. My export my revenues have grown by a healthy 38%. 4:55 4 minutes, 55 seconds Xelcom they have grown by 31%. 5:01 5 minutes, 1 second All the key drivers of superior margin automotive industrial 5:09 5 minutes, 9 seconds healthcare exports and ODM they have all fired in the right direction. Automotive 5:16 5 minutes, 16 seconds has grown 39% industrial 30% healthcare 36% exports 41% 5:25 5 minutes, 25 seconds and uh ODM has also gone up significantly to approximately 17% 5:34 5 minutes, 34 seconds which is almost like a 80% jump from 453 to 825 cr. 5:42 5 minutes, 42 seconds Now this gives us a good platform to grow in the coming year. Uh we achieved 5:50 5 minutes, 50 seconds 1477 crores revenue uh in the last quarter which is a run rate of approximately 5:58 5 minutes, 58 seconds 500 crores a month which translates into 6,000 crores revenue at the same pace 6:06 6 minutes, 6 seconds without a growth coming in in the second half of the year. My exports at C72 crores give a good run rate of 125 6:15 6 minutes, 15 seconds crores which is again equivalent to the next year the target of about 1,500 crores. 6:23 6 minutes, 23 seconds So we are well set to capitalize on this consolidation which we have done in the 6:29 6 minutes, 29 seconds current year and going forward we are very confident that on the three critical parameters which we measure 6:38 6 minutes, 38 seconds ourselves against primarily the AITA operating cash flow and the revenue growth. uh on all these three we would 6:47 6 minutes, 47 seconds be able to exceed the performance of this year or sustain the performance of this year. 6:58 6 minutes, 58 seconds Thank you very much. 7:03 7 minutes, 3 seconds So yeah so so now I hand over the call to uh the Agraal chief financial officer. Hi, good morning everyone and 7:11 7 minutes, 11 seconds welcome to Stigma SGS earnings call for quarter 4 and full financial year 2026. 7:17 7 minutes, 17 seconds I'm pleased to report that this has been a landmark year for us defined by strong execution meaningful margin expansion 7:26 7 minutes, 26 seconds and significantly strengthened balance sheet. Let me begin with quarterly numbers first and then I'll take you through the annual performance. 7:34 7 minutes, 34 seconds Quarter 4 2026 was our strongest quarter yet. Consolidated total revenue for the 7:40 7 minutes, 40 seconds quarter was 1477 crores up by 56% on a year-on-year basis and 16% frequently. 7:48 7 minutes, 48 seconds An outstanding upcoming way on business side industrial vertical contributed maximum as a 31% of our revenue followed 7:57 7 minutes, 57 seconds by consumer vertical 26% auto vertical 24%. 8:02 8 minutes, 2 seconds While all verticals showed a solid double digit growth on a year-on-year basis, IPM railway was the standout 8:09 8 minutes, 9 seconds segment this quarter growing 122 182% year-on-year basis. 8:15 8 minutes, 15 seconds Our operating for the quarter came in 174 crores up by 51% yearon year at 8:22 8 minutes, 22 seconds 11.9% margin. EBT grew 61% Y to 150 crores and 8:30 8 minutes, 30 seconds PAT rose 67% to 119 crores with PAT margin of 8.1%. 8:36 8 minutes, 36 seconds Up by 60 basis points over last year. 8:40 8 minutes, 40 seconds On a sequential basis margin moderated slightly operating income margin was 11.9% versus 12.6% in quarter 3 8:49 8 minutes, 49 seconds primarily due to higher risk of IT business during this quarter. 8:53 8 minutes, 53 seconds Moving to our annual performance, our total revenue for FI26 came in at 4857 crores reflecting 27% year-on-year 9:03 9 minutes, 3 seconds growth. When we see as we have previously guided that we will keep consumer business vertical below 35% 9:10 9 minutes, 10 seconds which is actually 31% for FI26. And when we calculate our growth X of consumer business, my revenue growth is actually 38% on a year-on-year basis. 9:20 9 minutes, 20 seconds More importantly, this revenue was or this growth was highly profitable. 9:25 9 minutes, 25 seconds Operating extended 68% year-on-year basis to 545 crores with operating margin improving 270 basis points to 11.3%. 9:36 9 minutes, 36 seconds Reported stood at 582 crores at a 12% margin. 9:42 9 minutes, 42 seconds The profitability story is even stronger at the bottom line. PBT grew at 88% year-on-year basis to 445 crores. What a 9:51 9 minutes, 51 seconds PBT margin expanding 300 basis points to 9.2%. 9:57 9 minutes, 57 seconds PAT is about 346 cr rupees for the year up by 87% on a year-on-year basis with PAT margin of 7.1%. 10:09 10 minutes, 9 seconds We can see this kind of a leverage where bottom line growth is nearly diverse the top line growth reflecting a structural improvement on a business model 10:17 10 minutes, 17 seconds reflecting our operating leverage benefit reflecting into the business model. On revenue mix side, export business constitute 24 25% of my 10:26 10 minutes, 26 seconds operational revenue and green 41% year-on-year basis highlighting our increasing global relevance. 10:34 10 minutes, 34 seconds Across vertical, IT is our fastest growth segment 74% year-on-year followed by auto 39% and healthcare at 36% growth on a year-on-year basis. 10:46 10 minutes, 46 seconds Our revenue for the year is about 17% substantially increased from 12% last year. 10:54 10 minutes, 54 seconds Coming to customer concentration, our top five customers contribute around 34% of revenue. Top 10 around 47%. Top 20 11:02 11 minutes, 2 seconds around 63% by revenue on a full year basis. FI26 on the order book visibility as on March 11:10 11 minutes, 10 seconds end we have about 6600 crores of total order book visibility together of which auto is about 29%. 11:17 11 minutes, 17 seconds Consumer is about 30%. Industrial vertical is about 24%. 11:23 11 minutes, 23 seconds Healthcare is about 5% and IT and ranges together is about 11% of my revenue or 11:31 11 minutes, 31 seconds coming to balance sheet and capital allocation we moved from a net debt position of 264 crores as an S525 to now 11:40 11 minutes, 40 seconds a net cash position of 467 crores this year end total debt reduced sharply from 611 11:47 11 minutes, 47 seconds crores to 353 crores and while cash and equivalent increased uh to 830 crores at the end year end 11:55 11 minutes, 55 seconds debt to equity is now.1x and ROC improved from 12.4% 4% to 16.9% 12:02 12 minutes, 2 seconds this year. When we calculate ROC on a goodwill adjusted basis, my actual ROC is 20.1%. The threshold uh number which we have been tracking always. 12:13 12 minutes, 13 seconds Coming to working capital performance, our working capital days improved from 69 days to 63 days on a year-on-year basis reflecting better operational 12:21 12 minutes, 21 seconds efficiency. Net working capital days when we calculate on a X of Elcom which we have recently acquired it is actually 12:28 12 minutes, 28 seconds 58 days. So on a like to light basis versus last year the overall improvement into the networking capital days is about 11 days 12:37 12 minutes, 37 seconds for the year we generated a healthy operating cash flow of 290 cr rupees which is around 53% of my operating and 12:45 12 minutes, 45 seconds this outcome is based on disciplined working capital management and strong profitability delivery here. The capex investment for the year is about 140 cr 12:54 12 minutes, 54 seconds rupes and we expect another 100 to 150 cr rupes of capex investment into the current year which is fi27. 13:03 13 minutes, 3 seconds We want to update regarding one of our previously announced JV with premier energy wherein we were planning to 13:10 13 minutes, 10 seconds acquire a company called K solar through that JV. uh we want to agree that there were certain conditions precedent which we agreed with the sellers for the 13:18 13 minutes, 18 seconds acquisitions and which the seller was not able to fulfill as per the timelines. Hence we decided to drop the same acquisition or JV transaction. 13:28 13 minutes, 28 seconds To summarize FI26 has been a strong execution across revenue profitability cash flows. 13:36 13 minutes, 36 seconds We enter FI27 with a net cash position improving ROC a diversified and growth revenue base and capacity investments 13:44 13 minutes, 44 seconds that position us well on the next four years of growth. We also want to update to the market on our rating upgrade long-term rating upgrade from A minus to 13:52 13 minutes, 52 seconds double A now showing a strong confidence of the all the stakeholders in the market in our credibility. 14:01 14 minutes, 1 second We remain committed to our aspirations of sustained revenue growth of 35% with a sustainable operating margin of at 14:07 14 minutes, 7 seconds least 10 to 10 and a half% targeting 700 crores of total IITA for the next year FI27. The demand environment across all 14:15 14 minutes, 15 seconds key verticals auto industrial healthcare and the emerging IT railways and the defense and maritime business remains encouraging. With that I'll hand it over to Mr. Satendra Singh our CEO. 14:28 14 minutes, 28 seconds Thank you Vijay and thank you BJI and everyone on the call. Uh thank you for joining today. As always I'll start uh 14:37 14 minutes, 37 seconds uh my comments with thanking all my 10,000 plus colleagues in our factories in our offices who work day in and day 14:45 14 minutes, 45 seconds out to ensure that our customers stay delighted and they help us in the growth 14:51 14 minutes, 51 seconds story which uh Gujarat Alji and Vijay uh shared with you. 14:58 14 minutes, 58 seconds Financial year 26 has been a defining year for Surma. It's the one where we didn't just grow the top line but we strengthen every pillar of our business. 15:07 15 minutes, 7 seconds Our people, customers, operations and supply chain. 15:14 15 minutes, 14 seconds Uh on profitability margin expanded meaningfully across the year. Our gross margin improved from 22.6 to 25.6 six uh 15:24 15 minutes, 24 seconds year on year and uh margins improved significantly as Vijay shared and profit after tax 15:32 15 minutes, 32 seconds doubled almost year on year and margin touching 7.1%. 15:37 15 minutes, 37 seconds This clearly reflects operating leverage of scale. 15:42 15 minutes, 42 seconds We continue to make u improvements in our uh customer acquisition. We acquired several customers and we those customers 15:50 15 minutes, 50 seconds will help us fuel the growth in uh financial year 27 and onwards. Most importantly, we continue to deepen our 15:59 15 minutes, 59 seconds engagement with the customer customers which is reflecting in larger wallet share with many of our customers and 16:07 16 minutes, 7 seconds maturity of the programs which we execute with them. 16:12 16 minutes, 12 seconds This year uh operationally we have made several improvements. 16:17 16 minutes, 17 seconds The utilization of our people resources utilization of our machines have gone up significantly over FY25. 16:29 16 minutes, 29 seconds This all the improvements and all the efforts across the operations and across our businesses clearly has been noticed by our customers and by industry alike. 16:42 16 minutes, 42 seconds We got nine customer awards and 19 industry across during the year. 16:48 16 minutes, 48 seconds As we know uh the supply chains are going through certain anxieties and our 16:55 16 minutes, 55 seconds supply chain team and procurement teams across the plant have worked hand inhand with our customers to ensure 17:02 17 minutes, 2 seconds continuity of supply chain and ensuring that we stay competitive on people. 17:10 17 minutes, 10 seconds Our engagement continues to improve and our last great place to work score rose from 83 to 86 this year. We continue to 17:20 17 minutes, 20 seconds upgrade our processes across all the areas of our business. 17:26 17 minutes, 26 seconds Looking ahead, uh, FY27 reflects strong conviction in our pipeline, 17:33 17 minutes, 33 seconds our new customer additions and our operational readiness and our balance sheet or rather strong balance sheet gives us the flexibility to invest in 17:42 17 minutes, 42 seconds this growth while delivering delivering consistent returns. We remain committed to our long-term vision of being India's leading integrated electronics 17:50 17 minutes, 50 seconds manufacturing partner and this year the FI26 has brought us meaningfully closer to that goal. Thank you everyone 17:59 17 minutes, 59 seconds on this call and once again to our customers to our colleagues across the factories for great support and we look forward to similar support in the years ahead. 18:11 18 minutes, 11 seconds Thank you once again and I'll hand it over to Nikl. Yeah. 18:14 18 minutes, 14 seconds Yeah. Thank you Sender. uh uh over to Michelle. Uh we can go ahead on the Q&A session. Thank you. 18:20 18 minutes, 20 seconds Thank you very much sir. Ladies and gentlemen, we will now begin with a question and answer session. Anyone who wishes to ask questions may please press 18:28 18 minutes, 28 seconds star and one on the touchstone phone. If you wish to withdraw yourself from the question queue, you may press star and two. Participants are requested to use only handsets while asking a question. 18:40 18 minutes, 40 seconds Ladies and gentlemen, we will wait for a moment while the question assembles. 18:50 18 minutes, 50 seconds The first question is from the line of Indrajit Agarwal from CLSA. Please go ahead. 18:56 18 minutes, 56 seconds Uh hi, congratulations on a good set of numbers and thank you for the chance. Uh two questions from my side. If you can highlight uh the capeex pending capeex 19:04 19 minutes, 4 seconds on key projects not just for FI27 but also over the medium-term PCB and any other projects that you're undertaking right now. 19:13 19 minutes, 13 seconds Sure. I'll take this one. So overall the large project which we are taking over right now is the PCB related business. 19:20 19 minutes, 20 seconds So PCB related we said that we are planning to spend approximately $90 million which is 800 crores of capex over the years for this multi-layer line 19:29 19 minutes, 29 seconds kind of a PCB setup and this capex we are spreading across uh two phases. 19:34 19 minutes, 34 seconds Initial phase is 400 crores which is going on and of which about 50 cr is already spent till last year. This year we are expecting we'll be spending 19:42 19 minutes, 42 seconds around 250 all crates is the same process balance 100 can go in the next year and the second phase can be spent 19:49 19 minutes, 49 seconds over the next year and will be made of FI29 also that's what we are spreading that multi-layer business related 800 19:56 19 minutes, 56 seconds crores of capex apart from that organic capex within the system normal business we are expecting 100 to 150 crores of 20:03 20 minutes, 3 seconds capex this year okay so 100 to 150 is only the organic and then add to that the 250 So broadly overall effects come something around 350 to 400. 20:13 20 minutes, 13 seconds And when do we expect the incentives or the benefits to come from the government post FI28 right? 20:21 20 minutes, 21 seconds We are expecting commissioning of the projects towards the end of this year maybe start of next financial year FI28 then we will be eligible to claim for 20:29 20 minutes, 29 seconds the incentives in the park basis and generally I expect at least a year will take to get that incentives. 20:38 20 minutes, 38 seconds Sure they're helpful. And second uh while you touched upon it in the opening remarks if you can get more granular 20:44 20 minutes, 44 seconds details on the impact of the current geopolitical tension site. Is there an issue in availability of raw materials? 20:51 20 minutes, 51 seconds What kind of inflation are you seeing and are we passing that on with what lead lag? 20:58 20 minutes, 58 seconds See the supply chain issues are again global in nature and not specific to one company or one industry. 21:07 21 minutes, 7 seconds So it is a phenomena where the basic metal prices have gone up. Uh the Middle Eastern crisis has sort of disrupted the 21:16 21 minutes, 16 seconds supply chain roots. The logistic costs have gone up. Now these things are a 21:23 21 minutes, 23 seconds part and parcel of the business and when all the companies are impacted sort of it's not unique to us. Having 21:32 21 minutes, 32 seconds said that, we are in constant touch and we have contract arrangements with the customers where there's a pass through 21:40 21 minutes, 40 seconds mechanism of variation in prices. Now, does it happen on day zero? The answer is no. It is negotiated and then uh taken into account. 21:53 21 minutes, 53 seconds We believe that in the current year uh these things would continue to play out till the situation comes back to normal. 22:05 22 minutes, 5 seconds We believe that this partial increase in these costs could be offset by better buying. uh the 22:15 22 minutes, 15 seconds volumes go up, you get a better uh negotiation path, operational efficiency and then sharing these costs among the 22:24 22 minutes, 24 seconds four stake. There are essentially four stakeholders in the entire supply chain. 22:29 22 minutes, 29 seconds In our case, it is our vendor, Selma, SGS, the customers of Selma and the ultimate consumer. 22:37 22 minutes, 37 seconds Now once the situation sort of stabilizes then the cost impact will be borne by all the four stakeholders. 22:47 22 minutes, 47 seconds What is the impact of that we are not very clear right now but uh having 22:54 22 minutes, 54 seconds delivered a beta margin of 12 odd% this year next year we are guiding 10.5 to 11% keeping this turmoil into account. 23:06 23 minutes, 6 seconds Now if the situation stabilizes and we come back to normal situations if it warrants a upward revision beyond that 23:15 23 minutes, 15 seconds uh we will uh guide the market according thank you. 23:25 23 minutes, 25 seconds The next question is from the line of Sumant Kumar from Motila Los. Please go ahead. 23:31 23 minutes, 31 seconds Hi sir. So can you talk on uh the IT and railway we have seen a 182% growth. So 23:38 23 minutes, 38 seconds uh can you uh talk on more uh subsegment how the other sub subsegment and what are the uh the key driver for the segment? 23:47 23 minutes, 47 seconds The IT and the railways are a small portion of our revenue and uh again we don't look at the revenues on a 23:55 23 minutes, 55 seconds quarterly prism. If I look at it on a overall basis, my uh IT and railways 24:02 24 minutes, 2 seconds have gone up uh from uh about uh 240 24:09 24 minutes, 9 seconds to about 476 on an annualized basis. 24:15 24 minutes, 15 seconds uh this is as we said that the railways we were in uh uh touch with the customers and it is essentially the 24:24 24 minutes, 24 seconds laptop related and the motherboard related business and the memory related business which we do. So going forward 24:32 24 minutes, 32 seconds we expect this momentum of 80 odd 90% not to continue but it'll continue to deliver healthy 30 40% growth rates over the coming years. 24:44 24 minutes, 44 seconds Okay, thank you so much. 24:51 24 minutes, 51 seconds Thank you ladies and gentlemen. In order to ensure that the management will be able to address questions from all the participants in the conference, kindly 24:59 24 minutes, 59 seconds limit yourself to only two questions per participant. Should you have a follow-up question, please rejoin the queue. We'll take the next question from the line of 25:07 25 minutes, 7 seconds Achelare from Noama Institutional Equities. Please go ahead. Uh yeah, good morning sir. Am I on? 25:16 25 minutes, 16 seconds Yes please. Yes sir. Yeah uh thank you for the opportunity. 25:19 25 minutes, 19 seconds Congratulations for excellent performance. Uh I was just curious sir uh while you have kind of indicated code on the margin. Uh I'm just trying to dig 25:28 25 minutes, 28 seconds deeper on this aspect. You know we have touched 12% margin for last two quarters 12 and a half and 12%. 25:35 25 minutes, 35 seconds uh and if we are talking about a similar growth across vertices uh why the margin guidance uh you know that 10 and a half 25:43 25 minutes, 43 seconds to 11% uh despite having an uh you know improvement on the on account of exports 25:50 25 minutes, 50 seconds ODM mix going up and third the operating leverage just curious you know uh given it's kind of a pass through arrangement 25:58 25 minutes, 58 seconds for the cost um any particular reason apart from the generic reason what you have given for margin. 26:07 26 minutes, 7 seconds See, as I just said in the preceding questions, we would like to er on the side of caution. Uh the current uh 26:15 26 minutes, 15 seconds volatility in the global trade, in the shipping routes, in the geopolitical, the basic metal prices going up uh would 26:25 26 minutes, 25 seconds cause a stress on the economy on a macro level which is beyond our control. 26:31 26 minutes, 31 seconds Hence we would like to earn the side of caution and we have guided 10 and a half to 11% margin despite having delivered 26:39 26 minutes, 39 seconds 12% margin to be very honest. Now if 3 months down the line when we talk when 26:46 26 minutes, 46 seconds we meet you again for the Q1 earning call of FY 27 if the situation has stabilized and we have a better picture 26:55 26 minutes, 55 seconds we'll revise the guidance. uh but we'd like again at the expense of repetition on the side of caution 27:03 27 minutes, 3 seconds and the pass throughs are there but it doesn't happen on day zero. It takes time. So keeping all the things into 27:11 27 minutes, 11 seconds account uh we have guided that thing. Uh but the more critical thing which we have guided is that we'll deliver a 30% 27:21 27 minutes, 21 seconds absolute increase in aa I understand and if you could uh uh you 27:30 27 minutes, 30 seconds know comment on each of the segment what is the outlook on the growth path uh you know while you have given a broad uh 27:38 27 minutes, 38 seconds guidance uh if you could give on each of the segments the three segments which which segment your voice equ 27:50 27 minutes, 50 seconds sorry sorry for that uh if you could uh talk a little bit on each of the segment like auto, consumer, healthcare, you know, uh if the underlying industry 27:59 27 minutes, 59 seconds growth is as much uh if this growth is driven by domestic or exports and stuff like that, you know, give little bit 28:06 28 minutes, 6 seconds more detailing on each of these four key segments. 28:09 28 minutes, 9 seconds But if we go back to 256, what do we see? We see a 39 odd% growth in 28:15 28 minutes, 15 seconds automotive, 30% in industrial, 36% in healthcare, 38% 28:23 28 minutes, 23 seconds in only consumers and 31 41% growth in exports. 28:29 28 minutes, 29 seconds My current order mix which we have order book has uh the same level of component 28:37 28 minutes, 37 seconds of each with the automotive accounting for about 30% industrial about 25% healthcare about uh 5%. 28:47 28 minutes, 47 seconds So based on this I think we are in a position to deliver a blended growth of about 30 35% for the current year. 28:57 28 minutes, 57 seconds individual verticals or adverise basis some would be at 35% some would be at 28%. 29:06 29 minutes, 6 seconds The industrial growth would primarily be driven by exports and uh uh new sort of 29:13 29 minutes, 13 seconds products or the which will be manufacturing for the power management units and other things. Automotive would 29:21 29 minutes, 21 seconds primarily be driven by domestic though for the first time last year we have crossed 125 crores in automotive 29:28 29 minutes, 28 seconds exports. They would register some increase over there. Also medtech has grown significantly. The 29:37 29 minutes, 37 seconds healthcare business has grown significantly from 291 to 395 this year and we expect this continuous growth to 29:46 29 minutes, 46 seconds happen which means the next year my met business should cross the 500 cr. 29:53 29 minutes, 53 seconds consumer we are cautiously pegging it down at about 30% of our revenue and uh 30:00 30 minutes which this year it's about 1452 crores and uh 8 10% growth it should be about 30:07 30 minutes, 7 seconds 1,600500600 cr rupees so the blended growth would come from the dominant sectors of 30:15 30 minutes, 15 seconds automotive industrial healthcare which is met and railways are a small portion of our 30:23 30 minutes, 23 seconds revenue grow. 30:29 30 minutes, 29 seconds Got it. Uh thank you. I'll call back in the quir. Thank you. 30:34 30 minutes, 34 seconds Thank you. The next question is from the line of Pavia Gandhi from Bajage Alternate Investment Management Limited. Please go ahead. 30:43 30 minutes, 43 seconds Yeah. Hi, thanks for the opportunity. My first question is regarding the total order book. uh uh between December and 30:49 30 minutes, 49 seconds March our order book uh has grown by almost 3%. Versus our historical run rate of uh 7 to 10%. Uh if you can 30:59 30 minutes, 59 seconds explain uh is there any slowdown in terms of uh order intake or what is the reason for this or better execution or 31:07 31 minutes, 7 seconds some any other factors if you can proide? 31:11 31 minutes, 11 seconds I'll request DJ to take this answer. So when we see there is highway delivery in this quarter we have done almost 1500 crores of revenue for the quarter. So 31:18 31 minutes, 18 seconds this is after executing that quarter 4 also. So in the previous quarter in 6400 you should actually see out of 6400 cr 31:26 31 minutes, 26 seconds 1470 is already delivered during the quarter and then additionally we were able to add about 1670 or 1700 cr to 31:35 31 minutes, 35 seconds reach to 6600 cr level. The growth is even higher than the previous quarters net recent year of which 200 cr is net 31:42 31 minutes, 42 seconds recent after the quarter right basis the current order book and run rate uh the overall revenue growth 31:49 31 minutes, 49 seconds for the next year comes to 24% uh whereas we are guiding for 35%. So are we seeing any order pipeline uh that we 31:58 31 minutes, 58 seconds are expecting order intakes in coming quarters. 32:02 32 minutes, 2 seconds So we are guiding actually about 35% of the growth for FI27 and this order book is indicative 32:10 32 minutes, 10 seconds whatever is there in hand today but this order book has to be over the period over the next few quarters has to be completely continuously upgraded based 32:18 32 minutes, 18 seconds on the as new order additions and all these orders are not for one year in this order book there will be many customers who will be giving you orders for a very shorter period maybe 3 months 6 months 5 months four months that way. 32:29 32 minutes, 29 seconds So that's how that's how this operates in a way. Okay. 32:33 32 minutes, 33 seconds Just to add Yeah, just to add on, we have achieved a run rate of about 1,465 crores in the current quarter which is 32:42 32 minutes, 42 seconds uh tag uh less than uh sort of 500 crores a month and that's the starting 32:50 32 minutes, 50 seconds point. Now if the starting point is 500 crores or 495 crores a month the run 32:56 32 minutes, 56 seconds rate and going forward historically the second half is much better than the first half. Uh we are very confident of 33:05 33 minutes, 5 seconds delivering the figures which Vijay just wanted out and again said in my opening my exports 33:13 33 minutes, 13 seconds are currently at 125 crores run rate and we're targeting 1,500 cr plus. So we are already at a 6,000 plus cr revenue level 33:23 33 minutes, 23 seconds at the current time rate and the second half typically is a superior half in terms of top line and the resultant figures on the bottom line. 33:34 33 minutes, 34 seconds Right. In terms of Yeah. 33:38 33 minutes, 38 seconds right got it got it. No wonderful. Uh sir just in terms of cash we are around 470 crores of net cash at this point in 33:45 33 minutes, 45 seconds time and bases your capeex that you announced uh for the PCB if I'm not wrong we have to spend around 1,400 crores so after a year uh we'll be short 33:55 33 minutes, 55 seconds of cash in terms of and if we assume another 200 300 crores of operating cash flows also next year still we'll be 34:01 34 minutes, 1 second short of cash uh so how do we plan to fund this because we only spent 50 crores for the PCB thing 34:09 34 minutes, 9 seconds so this year For the PCB business you will be spending around 250 crores rupees and for the same it will be partly funded through debt and partly 34:17 34 minutes, 17 seconds through internal approvals and there is a JV partner also 25% of this cap has to be funded by the GB partner also together. So that's how this has to be 34:26 34 minutes, 26 seconds funded against uh the current cash net cash position is 470 but actual cash on the balance sheet is about 820 cr rupes. 34:34 34 minutes, 34 seconds We are confident of using this cap uh cash on the balance sheet for the growth purpose going forward and cash flow side 34:41 34 minutes, 41 seconds we don't see any challenge over here just wanted to understand on the PCB capex we will not fall short of cash right that is what I wanted to understand 34:50 34 minutes, 50 seconds will not fall short of cash you see what we spend we have projected about $40 million which is about 400 crores of 34:57 34 minutes, 57 seconds whatever 360 400 crores for the current year and next year we'll get a 50 60% subsidy of that. So this will be a sort 35:06 35 minutes, 6 seconds of circular thing that you spend in one year, you get back a subsidy in the next year, then you again invest partly from 35:13 35 minutes, 13 seconds that subsidy, partly from your cash flows and borrowing and you get back. So we don't we have a plan over cash flow 35:21 35 minutes, 21 seconds that we will not fall short of cash for this project over its uh execution life cycle. 35:29 35 minutes, 29 seconds Perfect. Really helpful. Really helpful. 35:31 35 minutes, 31 seconds Wonderful. That's it from my end. Thank you so much. 35:35 35 minutes, 35 seconds Thank you. A request to all the participants to kindly use your handsets while asking the questions and also selfmute yourself that when the 35:44 35 minutes, 44 seconds management is speaking for an optimum audio quality in the conference. Thank you. We'll take the next question from the line of Bhavik Ma from JP Morgan. 35:53 35 minutes, 53 seconds Please go ahead. 35:55 35 minutes, 55 seconds Hi, thank you. Uh so my first question is you recently received ECM approval for flexible PCB and copper laminate. So 36:03 36 minutes, 3 seconds any color you can provide in terms of the capex which will go into this and over what time frame we could expect. 36:11 36 minutes, 11 seconds So we got approvals for PCL and copper clad laminate plus HBI and flex PCV that's another one. So both put together 36:18 36 minutes, 18 seconds we will be spending another 800 crores for those projects but that project capex may uh get executed somewhere 36:26 36 minutes, 26 seconds between fi 28 to 20 fi 30 this entire 800 crores 36:33 36 minutes, 33 seconds okay got it second question is on working capital and cash flows how should we think about working capital for next year will keep on coming down 36:41 36 minutes, 41 seconds and hence the year will keep on going up in FI27 uh see with the defense business coming 36:47 36 minutes, 47 seconds in our portfolio and we have reached a 63 days uh working capital cycle. Uh the endeavor would be to say if we can bring it down further. 36:58 36 minutes, 58 seconds Uh how much by 3 days 5 days I really can't say but I think uh we should be 37:05 37 minutes, 5 seconds all rest assured that working capital management and capital allocation is one of the prime focus of the management. 37:16 37 minutes, 16 seconds We are willing to sacrifice topline growth if the working capital cycle is elongated. 37:25 37 minutes, 25 seconds We are not chasing growth at the expense of working capital cycle. We'll be selective in our customers. We'll be 37:33 37 minutes, 33 seconds selective in the verticals. Uh selecting is that we'll do our due diligence to ensure that each vertical has its own 37:42 37 minutes, 42 seconds typical working capital cycle. We would like to have the best working capital cycle in that vertical account and that 37:50 37 minutes, 50 seconds is reflected in the way we have brought down the working capital cycle over the last four years for by I think when we started off it was 90 odd days. 37:59 37 minutes, 59 seconds Yes. 38:00 38 minutes And from 90 days last year we came down to 69 days. This year if 69 was to compare Apple to Apple if I were to 38:08 38 minutes, 8 seconds exclude Elcom both from the revenue and the working capital my days have come down from 69 to 58 38:16 38 minutes, 16 seconds which is 11 days reduction 11 days on uh 69 is almost like a 16% reduction 38:25 38 minutes, 25 seconds efficiency improvement in my working capital cycle. So that would remain the focus of the management and I think uh 38:33 38 minutes, 33 seconds everyone should be rest assured that we'll not let this lift out on an annualized basis. Quarteron quarter there could be some variation. 38:45 38 minutes, 45 seconds Okay, got it. Thank you. 38:48 38 minutes, 48 seconds Thank you. The next question is from the line of Reu Bugalia from Capital. Please go ahead. 38:56 38 minutes, 56 seconds Yeah. Um hi, good morning team. Um so if you can throw some more uh insights in terms of um the um value add products 39:04 39 minutes, 4 seconds and inputs that we're targeting within the industrial segment and how do we see these applications scaling up in our portfolio over the next two years. Um 39:12 39 minutes, 12 seconds some more insights uh would be headful that's my first question. 39:17 39 minutes, 17 seconds See uh the value addition the superior value addition as I was saying in my opening uh remarks comes in from ODM 39:26 39 minutes, 26 seconds business from exports within these each vertical each vertical has its own uh margin profile and a medtech and medtech. 39:36 39 minutes, 36 seconds Now what do we see that we have seen our ODM business growing up from 453 close 39:44 39 minutes, 44 seconds to 825 gross. Now this is almost a growth of uh uh 39:57 39 minutes, 57 seconds 1253 to 85 about 70% 70% growth uh my exports have gone up by 41%. 40:06 40 minutes, 6 seconds uh our effort in the current year is to try and sustain the ODM growth to around 40:14 40 minutes, 14 seconds 16 17%. I don't see it going up beyond 17%. Uh because we are planning targeting to grow by 35% 30 35%. 40:26 40 minutes, 26 seconds I personally don't see that in the current year my uh export the ODM growth would grow. If you're able to sustain it 40:35 40 minutes, 35 seconds at 17%, it means we have grown the ODM business by another 30%. 17% of the revenue mix. 40:44 40 minutes, 44 seconds Yeah. Yeah. Yeah. No, no, no. See, if my overall revenue goes up by 35% and if the ODM business has to sustain at 17%, this also has to grow in that rate. 40:55 40 minutes, 55 seconds uh a 30% growth on 825 if we have to grow the audience business by another 250 cr rupees next year in 2627 41:05 41 minutes, 5 seconds we'll endeavor to sustain this in the coming year but the profitability would 41:12 41 minutes, 12 seconds come in from working capital management expose met and ODM and all these 41:20 41 minutes, 20 seconds verticals we are showing a very healthy growth uh over the last uh year and we expect this growth to continue. My 41:29 41 minutes, 29 seconds exports grew by 41% last year. I expect them to cross the 1500 cr from the 1200 41:36 41 minutes, 36 seconds crails the target of 1100 crores which we had set. So a 300 cr in exports absolute increase in exports adds to the 41:45 41 minutes, 45 seconds margin profile long-term. 41:49 41 minutes, 49 seconds Sorry, sorry. No, I'm just wanting to ask what percentage of the ODM business would be 41:56 41 minutes, 56 seconds uh housed in the industrial segment or how would be the ODM split across key end segments in which you operate. See, 42:04 42 minutes, 4 seconds so tech is typically all ODM. So if I was to take my healthare business which 42:10 42 minutes, 10 seconds is 395 crores it's all broadly back of the hand calculation we have to split it into the thing but back of the hand 42:18 42 minutes, 18 seconds calculation out of the 825 crores 395 crores is met. So remaining comes in from consumer and industry automotive 42:27 42 minutes, 27 seconds has very little uh metal business. Got it. 42:34 42 minutes, 34 seconds So 430 430 crores is both industrial and uh consumer but I don't have the figures of how much of this is among it. 42:47 42 minutes, 47 seconds Sure. Um and so secondly just follow up on hopping bit again on the margin side while I know I understand you would uh 42:54 42 minutes, 54 seconds to be slightly more conservative here uh but given that the ODM portfolio exports both are expected to further um improve 43:02 43 minutes, 2 seconds in terms of mix uh rupee has been in our favor which will probably help offset some of the cost headwinds that you're sitting on there operating leverage um 43:10 43 minutes, 10 seconds still do you think uh that um the quarterly run rate which you were doing in the second half or middle of the year of 12% will um see headwinds of about 43:19 43 minutes, 19 seconds 200 basis point or do you think um the cushion are very thin here and we may not have beyond 100 bits margin cushion 43:28 43 minutes, 28 seconds end of the day the current situation in the market volatility and everything I think we expect that we 43:37 43 minutes, 37 seconds should have the luxury of uh being conservative let's put it that way 43:44 43 minutes, 44 seconds there's no point yeah but no point tomorrow I say 12 and I give 11 you'll skim me down why it is 11 so you would 43:52 43 minutes, 52 seconds like to have the luxury of being conservative absolutely uh and sir lastly um just your thoughts on now we are seeing uh 44:00 44 minutes larger players also foray into electronics uh EMS focusing on industrial um and other segments um so 44:08 44 minutes, 8 seconds how do you see uh a the India EMS market growing and also do you uh feel that competitive intensity in the domestic 44:16 44 minutes, 16 seconds space may increase uh even for experienced veterans like SMA SGS here um despite newer entrance entering in 44:24 44 minutes, 24 seconds the space. So for example as Larsson has recently announced a significant for electronics 50 billion rupees of capex 44:30 44 minutes, 30 seconds in the next two years. Um so that's I'm just trying to connect the dots and see how are we looking at the market outlook. 44:38 44 minutes, 38 seconds See okay now we've been in the industry for 40 years. We've been exporting since 96 when China was at its pride and our 44:46 44 minutes, 46 seconds exports have grown. Uh domestic there are big players already in the country whether it was whether it is Jabel whether it is Sanmina. 44:57 44 minutes, 57 seconds Uh they were present uh not now they've been present for quite a while. Uh we 45:03 45 minutes, 3 seconds are competing with the tier 2 level uh global EMS companies. 45:09 45 minutes, 9 seconds uh competition competitive intensity would increase. 45:15 45 minutes, 15 seconds Am I afraid of it? No. Am I mindful of it? Yes. And how do we take care of that? Uh 45:24 45 minutes, 24 seconds I think we can give a far better cost structure than the big corporates within the country. 45:33 45 minutes, 33 seconds Uh we have to be relentless in our focus on uh cost control, frugality, 45:40 45 minutes, 40 seconds uh efficient buying and uh as we get integrated to the global supply chains with our global customers uh it gives us 45:50 45 minutes, 50 seconds a confidence that we are doing something right otherwise my exports would not have gone up by 41%. But there are companies all around the world who are competing for the same business. 46:00 46 minutes So we are very mindful of the emerging competition. Uh but we welcome it. We can't stop it. So welcome it. 46:10 46 minutes, 10 seconds Got it. Understand. 46:14 46 minutes, 14 seconds Uh all right. Uh thank you and best wishes. Thank you. Thank you. 46:21 46 minutes, 21 seconds The next question is from the line of Kesha Loti from HDFC Securities. Please go ahead. 46:29 46 minutes, 29 seconds Hi. Thank you for the opportunity. I just want to understand when you talk about you know 30 35% addressable growth in your business going forward for 46:37 46 minutes, 37 seconds multiple years. So the growth is is industry growing so fast or is it more like you are gaining market share or is it like you are you know getting a new 46:45 46 minutes, 45 seconds product segment. How should we see this growth? I think you have hit the nail on that. 46:51 46 minutes, 51 seconds You have provided all the answers in your question. We are gaining market share. We are expanding our portfolio. 46:58 46 minutes, 58 seconds Metech was not there in my portfolio couple of years back. It is now contributing approximately 7 uh 78% of my uh 8% of my revenue. 47:10 47 minutes, 10 seconds Uh defense has just been added. So that's a incremental sort of a vertical 47:16 47 minutes, 16 seconds thing. We are uh now migrating to bigger contracts with bigger customers. So it's 47:23 47 minutes, 23 seconds not one piece which gives me the confidence of a 30 35% growth rate. It's a mosaic of all the customers put 47:31 47 minutes, 31 seconds together global domestic verticals uh my ODM business which gives me the 47:38 47 minutes, 38 seconds confidence of delivering what I'm saying and this is backed by a very detailed working by our teams going down to 47:47 47 minutes, 47 seconds industries customers SKU of customers what are the plans of the customers how they intend to grow what is the wallet 47:56 47 minutes, 56 seconds share which we'll be taking and to us growth is just a figure. To me what is 48:03 48 minutes, 3 seconds most satisfying is the quality of growth and the quality of growth comes in when I gain market share from my competition. 48:11 48 minutes, 11 seconds When I gain wallet share from my competition and on both these two fronts I think our teams are doing a phenomenally good job. 48:22 48 minutes, 22 seconds Got it. What would be the addressable market growth? You know, as you get better to multiple segment the blended, what would be the addressable market 48:30 48 minutes, 30 seconds growth? And lastly, when we talk about this growth in FY2, you will be entering PCB manufacturing business. So, possibly 48:38 48 minutes, 38 seconds this growth would be faster because of entry in that segment. 48:42 48 minutes, 42 seconds Yeah, the PCB business would kick in somewhere in 2728. 48:47 48 minutes, 47 seconds So whatever growth I'm projecting today for the next year is for the businesses in my portfolio. 48:56 48 minutes, 56 seconds Uh 2728 would be the first year when my PCB business will kick in. If it gives 49:03 49 minutes, 3 seconds me a 400 cr, 300 cr, 700 cr whatever is the figure that will be incremental to this grow. So if you are saying we'll 49:11 49 minutes, 11 seconds grow by uh let's take a wrong figure of uh 30% or 35% you have to calculate on 4800 crores it will result into some 49:20 49 minutes, 20 seconds resultant figure add another 30 35% that will be the organic growth in 2728 add 49:27 49 minutes, 27 seconds the PCB to that so 2728 logically the growth should be superior to 30 35% 49:34 49 minutes, 34 seconds because of the addition of the PCB vertically One of my question was what would be the 49:43 49 minutes, 43 seconds addressable market group in your country? 49:49 49 minutes, 49 seconds See the addressable market is so huge like what what are we talking of? We are not even a billion dollar company. Uh uh 49:58 49 minutes, 58 seconds if you take uh the likes of Jabil and all that they will be multi-billion 202$25 billion company. So I think 50:06 50 minutes, 6 seconds addressable market is a sort of uh just a feelood factor that this is a biggest market what we are addressing what we 50:15 50 minutes, 15 seconds are concentrating is the market is there we should be able to consistently 50:22 50 minutes, 22 seconds deliver 30 35% growth over the next 2 to 5 years organic 50:30 50 minutes, 30 seconds coupled with inorganic when we grow U maybe if I just quickly could add on 50:40 50 minutes, 40 seconds so as a business we are addressing not only India we are addressing global like if you see our numbers we are 25% of our 50:47 50 minutes, 47 seconds revenue comes from exports and global addressable market for reference is about north of 600 billion so and today 50:55 50 minutes, 55 seconds what we reported to you is give or take about 500 million plus uh revenue. So there is there is huge potential for 51:03 51 minutes, 3 seconds growth and that that's the market we are looking at addressing overall. 51:11 51 minutes, 11 seconds You got it. That is very helpful. Thank you so much. 51:15 51 minutes, 15 seconds Thank you. The next question is from the line of Pravin Sahai from PL Capital. Please go ahead. 51:22 51 minutes, 22 seconds Yeah, thank you for opportunity and many congratulations for a very good set of numbers. Uh the first question is 51:29 51 minutes, 29 seconds related to the export. Uh so uh as you had a guided for 15 cr for 27 and also 51:37 51 minutes, 37 seconds in the last call you had highlighted the strong EU market exposure is driving your number. So if you can give some 51:44 51 minutes, 44 seconds color on the how the EU market and what how much is the contribution and how is the growth going there. 51:52 51 minutes, 52 seconds See Mike the growth in exports last year has been 41%. And uh what we are targeting this year is less than 30%. If 52:00 52 minutes I do 1560 it will be about 30%. So I'm guiding 15. And these are based on the customers which we have on board uh 52:10 52 minutes, 10 seconds where we have started supplying. Some of the new customers which we have onboarded this year which means till March 26 52:19 52 minutes, 19 seconds would go on stream on a pilot basis in 26 27. 52:24 52 minutes, 24 seconds That gives me the confidence that 2728 the customers which would have 2 5 10 15 52:30 52 minutes, 30 seconds 20 crores of revenue in FY 2627 would have the potential to cross the 50 crore revenue 100 crore revenue 40 crore revenue in 2728. 52:42 52 minutes, 42 seconds So we believe that with the existing customers already sort of reaching their 52:49 52 minutes, 49 seconds uh uh what you call regular uptake level the new customers which you have onboarded which would be doing the 52:57 52 minutes, 57 seconds prototyping this year the growth of exports of about 25% 53:03 53 minutes, 3 seconds minimum over the coming years is a distinct possibility and we'll be able to achieve that 53:11 53 minutes, 11 seconds If some of the major customers which you have onboarded they have the potential to further 53:19 53 minutes, 19 seconds accelerate the export growth but for the time we are being conservative and putting in a target of 20 to 30% 25 to 53:28 53 minutes, 28 seconds 30% uh export growth for the coming any contribution from the EU can you 53:37 53 minutes, 37 seconds highlight sorry So if you're talking about UFA that has 53:45 53 minutes, 45 seconds a positive impact in a way that there will be a maybe sentimentally, psychologically there will be a larger business opportunities that are available which we can expand further. 53:55 53 minutes, 55 seconds In terms of number yes in few of the select cases there was a duty applicable about one per one and a half% that will 54:03 54 minutes, 3 seconds be that is something is the financial benefit one can look for going forward. 54:06 54 minutes, 6 seconds See these uh FTA agreements don't typically have a immediate positive or negative impact. You see it takes time 54:15 54 minutes, 15 seconds for the negativity to set in. In negativity, it is slightly faster. In case of positivity, it is slightly 54:22 54 minutes, 22 seconds slower. But long-term impact is very very positive. And I believe that we are very well positioned 54:30 54 minutes, 30 seconds uh to take uh benefit of the FDA which the government of India has signed with EU, with America, with New Zealand, with Canada and other things. 54:43 54 minutes, 43 seconds Okay. Uh next question is related to the related to the to the SMA and premier 54:50 54 minutes, 50 seconds which decided to not go with the case solar acquisition. Uh so uh uh is there any expense related to that we have 54:59 54 minutes, 59 seconds accounted and uh related to that is see there was very little expense related to the K solar acquisition. 55:07 55 minutes, 7 seconds Whatever has been spent has been charged off to the P&LN. Uh the there were certain conditions precedent which K 55:15 55 minutes, 15 seconds solar had to comply with. when they expressed their inability to comply with 55:21 55 minutes, 21 seconds uh we both decided that uh it was best to drop the team. Uh so we have dropped 55:29 55 minutes, 29 seconds the plans to acquire K solar but I would like to reiterate that we have not dropped the plans to be not to 55:38 55 minutes, 38 seconds be in the renewable energy space. We have very solid intent of entering the renewable energy space market in the 55:47 55 minutes, 47 seconds inverter business and the related uh products. Uh instead of a inorganic acquisition uh we would now be putting 55:56 55 minutes, 56 seconds up a green field project. Uh currently we are evaluating various proposals which we have got from the technology 56:04 56 minutes, 4 seconds partners. uh I would not be able to give a color on that because nothing is warmed up but I think in the coming uh 56:13 56 minutes, 13 seconds quarter or something we should come back to share our plans on that but uh renewable energy space is very much in our focus for future growth. 56:27 56 minutes, 27 seconds Thank you. And any thing on the PLI benefit for a full year? Last quarter you had given indication of 32 32 crores 56:34 56 minutes, 34 seconds for 26. How much? We had done uh PLI benefit we received. 56:40 56 minutes, 40 seconds Gross PLI for the full year would be approximately 80 cr rupees and post sharing we are expecting it will be net PL would be approximately 38 cr rupees for the year FI26. 56:52 56 minutes, 52 seconds Thank you sir and all the best. Thank you. 56:57 56 minutes, 57 seconds The next question is from the line of Nikil Kandui from Access Capital. Please go ahead. 57:03 57 minutes, 3 seconds Thank you for the opportunity and congratulations for a good set of visi number also. 57:12 57 minutes, 12 seconds Q4 PLI Q4 PLA would be approximately number would be approximately 10 cr rupees. 57:20 57 minutes, 20 seconds Okay. So just wanted to understand that the order inflow of 6200 crores include majority inflow from consumer and IT 57:29 57 minutes, 29 seconds business around 44%. And if I include also that is that comes down to 70%. You just want to understand that these are 57:38 57 minutes, 38 seconds relatively lower margin business where the ODM share from these business are very low. the guidance uh of 10 10.5 57:46 57 minutes, 46 seconds because of the increasing share of lower margin business is that right understanding apart from the supply chain issue which you highlighted 57:55 57 minutes, 55 seconds so order book is just an indication first of all order book is not is a clear reflection of the same similar way percentage for the full year of the 58:03 58 minutes, 3 seconds business because in order book you can see current order book for industrial business is 24% only because in industrial segment customer generally does not give you full maybe more than 58:11 58 minutes, 11 seconds 12 months kind of a initially. So that's how that's how generally it follows. My business needs mostly we are expecting it should remain 58:19 58 minutes, 19 seconds same as it was in FI26. Consumer should be around 30 32%. IT business yes it is growing it can be around it IT plus will 58:26 58 minutes, 26 seconds raise around 10%. And about 25% of auto business and 28 to 30% of industry business keeping the same my margin 58:34 58 minutes, 34 seconds would be in check. Yes, as Mr. Guidance has already guided we are expecting because it business is also slightly growing and maybe some bit of 58:42 58 minutes, 42 seconds geopolitical factors which are also impacting including raw material prices increase that's where we are guiding for this margins 58:52 58 minutes, 52 seconds okay understood so one last question from myself uh sir can you throw in more light on the smart metering business how much is it in the order book and how 59:00 59 minutes much did we set and a related question that would be that s kindly consider ecom business to be uh similar to smart 59:08 59 minutes, 8 seconds meter business which is high working capital intensive but also given us higher margins. 59:16 59 minutes, 16 seconds So smart me business we have done in the current year approximately 250 to 60 crores of total business in the order book I need to check exactly what's the 59:24 59 minutes, 24 seconds number is but as Mr. Bjal has already explained that we are going slightly selective we are keeping the working capital balance in ma and that's how we 59:32 59 minutes, 32 seconds are we are following answer only and smart material business are they almost similar because not not 59:41 59 minutes, 41 seconds in terms of uh industry but in terms of high working capital and high margins which can impact future working capital days for us. 59:50 59 minutes, 50 seconds Uh the smart metering business is not a high margin business. It is a normal 59:56 59 minutes, 56 seconds industrial it would come lower in the industrial category. Uh so in terms of margin profile the two businesses cannot 1:00:04 1 hour, 4 seconds be compared. One is a superior very high uh margin business. The smart metering business is not a very high margin 1:00:11 1 hour, 11 seconds business. It's a moderate 15 odd person gross material margin business. 12 to 15% gross margin material business but 1:00:21 1 hour, 21 seconds it has the same elongated working capital cycle. 1:00:27 1 hour, 27 seconds Hence the profitability of a smart metering business if you are not choosy about your customers if you chase revenues 1:00:36 1 hour, 36 seconds would be suspect in case of defense despite it's a longer working capital 1:00:43 1 hour, 43 seconds thing but since it's a very high margin business it's a OD and you give a solution uh to the customer uh it is 1:00:52 1 hour, 52 seconds offset uh such that even the higher working capital cycle skill results in a very superior AITA margin business. 1:01:03 1 hour, 1 minute, 3 seconds And if I just share that if we were to exclude Elcom business from our working capital for a minute and exclude its 1:01:12 1 hour, 1 minute, 12 seconds revenue, my working capital cycle for my business is down from 69 to 58 days. Uh 1:01:19 1 hour, 1 minute, 19 seconds with Elcom, it is down to 63 days. uh Elcom on its own would be a defense is 1:01:26 1 hour, 1 minute, 26 seconds the business is notorious for long 3 to 5 months 6 months working capital cycles 1:01:35 1 hour, 1 minute, 35 seconds but since it forms a very small portion of our revenue I don't see it negatively impacting my overall working capital 1:01:43 1 hour, 1 minute, 43 seconds cycle significantly got it and just if I can add one more question sir what will be the percentage 1:01:52 1 hour, 1 minute, 52 seconds of order book from Elcom in the total order book in the total order book Elcom's order book will be approximately 5%. 1:02:02 1 hour, 2 minutes, 2 seconds Okay, thank you. That's all for my sir. Thank you. 1:02:07 1 hour, 2 minutes, 7 seconds This will be the last question for today from the line of Tanesh Sha from Dam Capital. Please go ahead. 1:02:14 1 hour, 2 minutes, 14 seconds Yeah. Hi sir. Um good morning and congratulation on a great set of numbers. I have two questions. Um first 1:02:21 1 hour, 2 minutes, 21 seconds one being that uh while we're on track to grow at about 30 35% for FI27 can you possibly discuss um you know how 1:02:30 1 hour, 2 minutes, 30 seconds the how are we going to get that growth uh possibly some client additions which you would have added through FI26 and for what applications would that be 1:02:38 1 hour, 2 minutes, 38 seconds across segments uh which will sort of help us get that growth and the second question would be um so I'm assuming 1:02:45 1 hour, 2 minutes, 45 seconds that uh the defense number is coming in the industrial piece right now And um you know if we exclude that we have seen some softness out there as indicated by 1:02:54 1 hour, 2 minutes, 54 seconds you for smart meters but uh going forward X of the defense business uh you know some color on uh the applications 1:03:01 1 hour, 3 minutes, 1 second in industrial which will sort of help us uh continue the growth profile. Thank you. 1:03:08 1 hour, 3 minutes, 8 seconds Okay. uh now uh going forward we are projecting a growth of 30 35% and that's backed by the orders which we have 1:03:16 1 hour, 3 minutes, 16 seconds enhanced and the visibility which we have received from the customers uh we expect the businesses to grow 1:03:26 1 hour, 3 minutes, 26 seconds equally uh sort of at the same pace automotive this year has grown by 39%. 1:03:32 1 hour, 3 minutes, 32 seconds Uh healthcare has grown by 36%. 1:03:35 1 hour, 3 minutes, 35 seconds uh industrial including alcom has grown by 30 excluding alcom it would be slightly lower but some of the new customers in the power management sector 1:03:44 1 hour, 3 minutes, 44 seconds and the uh uh UPS sector and those uh uh 1:03:51 1 hour, 3 minutes, 51 seconds industrial electronics and controls uh would give us the revenue in the next 1:03:58 1 hour, 3 minutes, 58 seconds year. We have added how many customers last year? So 42 customers is what we have added onboarded in the last year 1:04:05 1 hour, 4 minutes, 5 seconds and of which if we talk about industrial about seven customers they have onboarded onto industrial segments. In fact if we talk about applications it is 1:04:13 1 hour, 4 minutes, 13 seconds varying across fuel injection systems solar trackers data center applications related motherboards uh liquid processing machines for FMDC as FMTC 1:04:23 1 hour, 4 minutes, 23 seconds applications. So those kind of applications for which we have added customers here. And when we talk about this 32 customers have a potential to 1:04:30 1 hour, 4 minutes, 30 seconds add at least a,000 cr plus in my current year revenue of 526 and full potential maybe about 2,500 cr plus in a long-term 1:04:38 1 hour, 4 minutes, 38 seconds basis for got that s got that. Thank you that was 1:04:46 1 hour, 4 minutes, 46 seconds helpful and congratulations and wishing you all the best for the new year. Thank you. Thank you. 1:04:53 1 hour, 4 minutes, 53 seconds As that was the last question for today, I would now like to hand the conference over to Mr. Gujaral for closing comments. Thank you and over to you sir. 1:05:03 1 hour, 5 minutes, 3 seconds Thank you. uh on a overall basis a very satisfying year but that's past we have 1:05:10 1 hour, 5 minutes, 10 seconds to focus on what we are going to do in the future and as we have all the time being saying that we would like to build a 1:05:19 1 hour, 5 minutes, 19 seconds sustainable business which has superior margin profile which has a decent 1:05:27 1 hour, 5 minutes, 27 seconds component of exported ODM and all these brands I think we are well poised is to achieve that. We are 1:05:37 1 hour, 5 minutes, 37 seconds relentlessly focusing on quality and environment and uh uh it's small issue but uh would 1:05:45 1 hour, 5 minutes, 45 seconds like to share with you uh that we are the first company in the country to get a certification for automotive 1:05:55 1 hour, 5 minutes, 55 seconds electronics information security for automotive industry known as SCEX. I didn't know it about six seven months 1:06:02 1 hour, 6 minutes, 2 seconds back. We were so informed by our one of our overseas customers which we are starting off the production somewhere 1:06:10 1 hour, 6 minutes, 10 seconds towards the end of the year which will give us a series production in 2728 to get this certification. 1:06:18 1 hour, 6 minutes, 18 seconds for Tyax. So we are relentlessly focused on building 1:06:23 1 hour, 6 minutes, 23 seconds top-notch factories with solid processes to give us operational efficiencies. We 1:06:32 1 hour, 6 minutes, 32 seconds are among the first Indian company to have a realtime monitoring system on our 1:06:39 1 hour, 6 minutes, 39 seconds S&P lines. It is being inducted in phases over all the plants and the initial results have been very very 1:06:48 1 hour, 6 minutes, 48 seconds encouraging. We have seen a 5 to 7% improve improvement in the operational efficiency. So I think uh 1:06:58 1 hour, 6 minutes, 58 seconds broad customer base, solid customers, reputed blue chip companies, leaders in their vertical, 1:07:07 1 hour, 7 minutes, 7 seconds uh very strong set of operational parameters in place at the plants and a 1:07:14 1 hour, 7 minutes, 14 seconds hunger for growth and hunger for learning. I think these two three factors define the DNA of Serma SGS and 1:07:22 1 hour, 7 minutes, 22 seconds I think going forward in couple of years when we again talk I think Serma would be at a different platform level in 1:07:31 1 hour, 7 minutes, 31 seconds terms of revenues and product mix which it is servicing and the customer profile which it is servicing. So this is a 1:07:40 1 hour, 7 minutes, 40 seconds journey. It's not a 100 m sprint. It's a marathon which we are running. Uh but 1:07:47 1 hour, 7 minutes, 47 seconds mindful of uh meeting the street expectations on a quarterly and annual basis. So I think uh we are well poised 1:07:55 1 hour, 7 minutes, 55 seconds to be uh among the top leading companies uh globally also. Currently I was told 1:08:02 1 hour, 8 minutes, 2 seconds we are ranked somewhere about 65 uh globally. I was reading in some magazines. So the uh effort is to that 1:08:11 1 hour, 8 minutes, 11 seconds keep graduating that Serma SGS is the first brand which is recalled in the mind of a potential customer when he's 1:08:19 1 hour, 8 minutes, 19 seconds looking for a EMS or ODM business. With this I thank everyone for the support 1:08:27 1 hour, 8 minutes, 27 seconds all the stakeholders, the vendors, the employees, the bankers, the investors uh for the faith we post in the management 1:08:36 1 hour, 8 minutes, 36 seconds of their SGS and we on our part would ensure that we build our institution which is part excellent in the country. 1:08:48 1 hour, 8 minutes, 48 seconds Thank you. Thank you members of the management. 1:08:53 1 hour, 8 minutes, 53 seconds Ladies and gentlemen, on behalf of ICICI securities, that concludes this conference. We thank you for joining us and you may now disconnect your lines. 1:09:01 1 hour, 9 minutes, 1 second Thank you.