Tata Motors Ltd — Q4 FY26

Tata Motors Ltd Q4 FY2025-26 Earnings Conference Call https://www.youtube.com/watch?v=3WKX54LyZjg&pp=0gcJCQQLAYcqIYzv

0:02 2 seconds Welcome to Tara Motors Q4 and fully year FI26 results call. I have with me Mr. 0:08 8 seconds Girishwag, managing director and CEO, EV Raman, CFO and the investor relations team. So I'll first walk you through the 0:16 16 seconds results presentation and this will be followed by Q&A. As a reminder, all participants will be in listenonly mode and we'll be taking your questions via 0:25 25 seconds the team's platform. name is already open to you for submitting questions. 0:30 30 seconds You may please mention your name and the name of your organization while submitting your questions. And with that, I hand over to Mr. Gi Raman. 0:38 38 seconds Thank you, Sah. Go to the next slide please. 0:42 42 seconds Before we get into the numbers, a quick word on the presentation format merger being effective from 1st of October 2025. 0:53 53 seconds Motors is now a pure play commercial vehicle companies and this is a defining shift that changes how we think is most appropriate to present our financials. 1:06 1 minute, 6 seconds Historically we reported a CV segment which was an internal construct that carved out CV operations from within the 1:13 1 minute, 13 seconds first wild combined entity that was a practical necessity then starting this quarter we are presenting 1:22 1 minute, 22 seconds standalone financials including joint operations data comments as our primary lens. 1:29 1 minute, 29 seconds This gives you a cleaner, more complete and more directly comparable picture of the business going forward. 1:37 1 minute, 37 seconds Operating segment is namely the CV segment comprising PML and subsidiaries 1:47 1 minute, 47 seconds is now included in the consolidated financial statements. Can you go to the next page please? 1:56 1 minute, 56 seconds By 26 is a year of strong execution across product, market and strategic initiatives. Some of the key highlights 2:04 2 minutes, 4 seconds included we launched 17 new next generation trucks at the start of Q4 and 2:11 2 minutes, 11 seconds earlier in the year around June we launched the ACE Pro which is positioned as India's most affordable four-wheel mini truck. 2:20 2 minutes, 20 seconds In February, we achieved a significant milestone by securing the largest ever order for 70,000 units Yoda and Ultra T7 vehicles for Indonesia. 2:31 2 minutes, 31 seconds We also secured orders 5,000 buses from multiple FTUs supporting India's mass mobility transformation. 2:40 2 minutes, 40 seconds Reflecting our focus on operational excellence, Parnaga plant received the golden peacock award for quality and we 2:48 2 minutes, 48 seconds also won multiple honors the Apollo CV awards 2026. Go to the next page please. 2:58 2 minutes, 58 seconds Moving to the major strategic and corporate development during the quarter on the EVO transaction. 3:08 3 minutes, 8 seconds All the most of the regulatory approvals have been secured and we are actively pursuing the remaining approval. We 3:15 3 minutes, 15 seconds expect the transaction closure by Q2 FY27. 3:22 3 minutes, 22 seconds The board has recommended a final dividend of rupees 4 per share and this is subject to shareholder approval. This 3:29 3 minutes, 29 seconds will result in a cash outflow of close to,500 crores. I go to the next page please. 3:38 3 minutes, 38 seconds Let me now take you through the full year financial picture and I think the headline really does say it. Consistent growth across every metric that matters. 3:48 3 minutes, 48 seconds Starting with the top line, revenue came in at 77,000 crores for FI26, up from 66,000 crores in FI23. 3:58 3 minutes, 58 seconds Our revenue improved 11% YI in FY26. 4:02 4 minutes, 2 seconds The underlining demand trajectory has been firmly upward. 4:07 4 minutes, 7 seconds What I'm really pleased is the margin story. Aida margins have expanded from 7.8% in 23, 13.2% 2% in FY26. 4:19 4 minutes, 19 seconds That's nearly 550 bips of structural improvement over 3 years. Not a quarterly, just not a one quarter 4:27 4 minutes, 27 seconds phenomenon. In absolute terms, AIDA has doubled from 5,100 4:34 4 minutes, 34 seconds to 10,200 crores. Now, EBT before exceptional items stands at 8,700 crores 4:42 4 minutes, 42 seconds and is very robust. We crossed the doubledigit EBIT margin for the first time at 11%. This is the result of 4:51 4 minutes, 51 seconds operating leverage playing out as we scale combined with cost discipline, improved realization and we've maintained across all the business. 5:02 5 minutes, 2 seconds What I also want to draw your attention to is a chart we're particularly proud of is the bottom left panel on 5:09 5 minutes, 9 seconds non-cyclical revenue growth over the period. non-cyclical CAGR is running at 2.7x 5:18 5 minutes, 18 seconds the cyclical CAGR we've been deliberately building this mix and this is now showing up meaningfully in the 5:26 5 minutes, 26 seconds numbers on capital allocation free cash flow generation was approximately 9,200 crores in FY26 5:36 5 minutes, 36 seconds that's about 12% of revenue and even after investing 2,800 crores back into the business we remain strongly cash generated. 5:47 5 minutes, 47 seconds Finally, the auto ROC stands at 72% is an industry-leading. 5:54 5 minutes, 54 seconds When EBIT doubles, capital discipline holds, the returns follow. That's the flywheel working as intended. 6:04 6 minutes, 4 seconds Next page, please. 6:07 6 minutes, 7 seconds We saw a strong volume momentum across product lines in FI26. 6:11 6 minutes, 11 seconds Q4 wholesale reached close to 131.8 units at 25% year-on-year increase for a 6:21 6 minutes, 21 seconds full year. Total volume stood at 4 lakh 28,000 units registering a 14% increase YI. 6:29 6 minutes, 29 seconds Looking at the product lines in Q4 FY26, all of them registered a doubledigit growth on a YI basis in Q4. 6:39 6 minutes, 39 seconds International business continues its growth trajectory with a YI growth at 17% in Q4 and 54% for the full year FY26 mainly led by the SA countries. 6:53 6 minutes, 53 seconds Next page, please. 6:55 6 minutes, 55 seconds This slide represents the summary of standalone financials of Tata Motors including the joint operations with Tata 7:02 7 minutes, 2 seconds Collins. Revenue for Q4 reached 24,500 crores marking a 22% YI increase due to 7:12 7 minutes, 12 seconds continued quarteron quarter ASP improvement driven by pricing discipline and favorable mix. 7:20 7 minutes, 20 seconds margin expanded steadily through the year and exited Q4 at 13.9% 7:26 7 minutes, 26 seconds up 130 bips y this is the 11th consecutive quarter of double digit aida margin delivery 7:35 7 minutes, 35 seconds margin for Q4 stood at 12.1% with FI26 closing a bit at double digit 7:43 7 minutes, 43 seconds as well another important milestone for the business all four vehicular business delivered Healthy margin and improved 7:52 7 minutes, 52 seconds unit economics, non-cyclical business continued to grow at nearly 1.6x the cyclical business, supporting the overall profitability for the company. 8:03 8 minutes, 3 seconds For the full year, profit before tax and exceptional items rose to 8,700 crores, an increase of 2,700 crores compared to last year. 8:14 8 minutes, 14 seconds Cash pack almost entirely translated into free cash flow. disciplined working capital management for the full year 8:22 8 minutes, 22 seconds free cash flow was 9,200 crores which is 12% of revenue. 8:29 8 minutes, 29 seconds This led to a year-end net cash position of 7,500 crores as of March 31st 2026. 8:38 8 minutes, 38 seconds Moving over to the Q4 EIT walk margin expanded to 12.1 up to 20 bits IO 8:48 8 minutes, 48 seconds while PBT before exceptional item increased to approximately 3,000 crores. 8:53 8 minutes, 53 seconds Higher volume fix price realization together contributed nearly 250 basis points to a bit margin improvement. 9:04 9 minutes, 4 seconds variable cost impact of 50 bips on account of elevated material cost due to inflation in key commodities including steel, aluminium and copper. 9:16 9 minutes, 16 seconds We also continued to see pressure from precious metals and certain imported components during the quarter. 9:24 9 minutes, 24 seconds In terms of other costs, lower depreciation and product development impact contributed positively by 102 crores. 9:33 9 minutes, 33 seconds Additional benefit from PLI and incentive benefit was approximately 25 crores. Overall, despite commodity 9:40 9 minutes, 40 seconds headwinds, business delivered another quarter of strong structural margin expansion by higher volume, better mix and improved realization. 9:51 9 minutes, 51 seconds Moving on to the cash flow now, as mentioned earlier, our free cash flow is growing consistently over the years. 9:58 9 minutes, 58 seconds Full year FCF for the company stood at 9,200 crores. Performance was driven by 10:05 10 minutes, 5 seconds strong operating profitability, efficient working capital management, controlled capex execution and lower 10:14 10 minutes, 14 seconds finance cost. Working capital remained very well controlled. The trade receivables 10:23 10 minutes, 23 seconds at 376 crores. inventory the burn of 690. This was largely due to 10:30 10 minutes, 30 seconds strategic inventory that we built up towards year end in the context of the ongoing geopolitical development 10:37 10 minutes, 37 seconds payable and acceptance to the release of 257 crores. 10:45 10 minutes, 45 seconds Let me also take a moment to acknowledge the fact that this FCF is also taking into consideration tax payment which we did not have in the prior years. 10:56 10 minutes, 56 seconds Our cash conversion cycle is bestin-class at negative 31 days. It means the business continues to be self-funding on working capital. 11:09 11 minutes, 9 seconds Moving to the investment spending for FYI26 was approximately 3,000 crores and this remained fully aligned with our planned road map. 11:20 11 minutes, 20 seconds Total R&D expenditure amounted to approximately,700 crores. Capital expenditure and other investments totaled to approximately,100 11:29 11 minutes, 29 seconds crores. For FY27 we expect investments to remain broadly in a similar range. 11:36 11 minutes, 36 seconds Our investment spends have been consistent with the guided range of 2 to 4% of revenue and growth and tech 11:44 11 minutes, 44 seconds investments have always been prioritized. 11:50 11 minutes, 50 seconds Moving on to the consolidated financials. 11:55 11 minutes, 55 seconds The slide presents a summary of consolidated financial encompassing both automotive and the non-automotive 12:02 12 minutes, 2 seconds subsidiaries. For Q4, consolidated revenue stood at 26100 crores and Aida 12:09 12 minutes, 9 seconds margin for the quarter came in at 13.1 while PBT before exceptional item was 2,400 crores on a fullear basis as well. 12:18 12 minutes, 18 seconds Consolidated performance remained very strong. Revenue for FI26 reached approximately 84,000 crores and 12:27 12 minutes, 27 seconds the Abida margin continued to improve steadily through the year closing at 12.3%. 12:33 12 minutes, 33 seconds Consolidated free cash flow in Q4 was particularly strong at approximately 8,000 crores. This also included 12:41 12 minutes, 41 seconds advanced receipts related to Indonesia order. As a result, strong operating performance, disciplined cash management, year-end consolidated net 12:50 12 minutes, 50 seconds cash improved significantly approximately 13,700 crores and this was 4,000 crores in FI25. 13:01 13 minutes, 1 second With that for business update, I'll now hand this over to Girish. Over to you, Girish. 13:08 13 minutes, 8 seconds Thank you, Raman. So let's begin uh with the market share. 13:14 13 minutes, 14 seconds I think the market share has been trending upward and Q4 Wahan market share improved 13:23 13 minutes, 23 seconds sequentially with measurable gains in process and vans that is CV passenger and SCV pickup. 13:33 13 minutes, 33 seconds uh heavy commercial vehicles continued to consolidate its position and in fact in HCVs 13:40 13 minutes, 40 seconds we posted our highest off tech market share in a decade. So I think overall the market share story has been strong 13:49 13 minutes, 49 seconds in Q4 for the year gone by. Next 13:56 13 minutes, 56 seconds on uh the fleet indicators, transporter profitability, fleet utilization actually held at healthy levels 14:04 14 minutes, 4 seconds through the year. This is based on our fleetage data tracking almost a million vehicles and this indicates sustained freight activity. 14:15 14 minutes, 15 seconds Transporter profitability remained resilient which continues to support new vehicle purchases. 14:22 14 minutes, 22 seconds Diesel is the single largest operating cost for a transporter and therefore is a key monitorable as we enter FI27. 14:32 14 minutes, 32 seconds Going ahead as I have said H1 was muted 14:40 14 minutes, 40 seconds weighed down mainly by operation synindur related sentiment and an early monsoon on onset 14:48 14 minutes, 48 seconds that compressed activity across some of the markets but H2 staged a clear recovery driven by 14:57 14 minutes, 57 seconds the GST 2.0 controlled le consumption demand and Q4 was clearly the standout quarter of the year. 15:07 15 minutes, 7 seconds As we see the demand fundamentals actually remain intact. 15:14 15 minutes, 14 seconds As far as volume is concerned, offtech TIV grew 19% YI in Q4 15:22 15 minutes, 22 seconds while Tata Motors volumes outpaced the industry at 25% YI growth. For FY26, the TIV growth was 15:32 15 minutes, 32 seconds 12 and a half% and it marked the highest ever annual volume whereas Tata Motors grew 11.6% Y. 15:41 15 minutes, 41 seconds The freight index aged up quarter on quarter through Q4 on the back of firm consumption softened a bit in March and April. 15:55 15 minutes, 55 seconds Eway bill generation grew 15% on a Y basis in Q4 and in fact accelerated to 19% Y growth in March 2026. 16:07 16 minutes, 7 seconds April 2026 continued in positive territory at a 12% Y growth 16:14 16 minutes, 14 seconds which in our view is a reliable proxy for the underlying freight activity. 16:20 16 minutes, 20 seconds Diesel sales rose 8% Y to 8.7 million tons in March reflecting 16:28 16 minutes, 28 seconds strong commercial activity. April was at around 8.3 million tons which is 0.25% Y 16:35 16 minutes, 35 seconds growth fast transaction volumes remained fat in both March and April. 16:45 16 minutes, 45 seconds On the supply side, we did see for international business 16:53 16 minutes, 53 seconds vessel transit delays which were then proactively managed and exposure to affected trans shipment 17:02 17 minutes, 2 seconds hubs like Dubai, DHA has been contained. 17:08 17 minutes, 8 seconds We undertook a structured review of more than 130 tier one suppliers for energy 17:15 17 minutes, 15 seconds dependence especially LPG and their supply chain resilience. 17:21 17 minutes, 21 seconds You completed this exercise and have taken quite a few actions to improve the supply chain resilience. 17:30 17 minutes, 30 seconds Export plans for the Middle East and North Africa region have been recalibrated in response to the evolving Middle East 17:39 17 minutes, 39 seconds situation and it will be prudent to say that the sentiment remains cautious and is being monitored very closely. 17:53 17 minutes, 53 seconds Coming to the businesses in trucks, we strengthened our product offerings with the launch of the Azura range in MCV 18:02 18 minutes, 2 seconds and of course HCV. We launched a su of new trucks with higher payload and higher fuel efficiency. 18:12 18 minutes, 12 seconds Now our entire truck range actually meets the stringent and 18:18 18 minutes, 18 seconds European safety standards on all the cabins in buses. We enter FY27 with a solid 18:28 18 minutes, 28 seconds government order book providing near-term volume visibility. 18:36 18 minutes, 36 seconds In SCV pickup, we broadened our lineup with asent and intrae launches 18:45 18 minutes, 45 seconds and this helped therefore to improve the volume growth in Q4 18:54 18 minutes, 54 seconds in the parts and service business. We were able to sustain the higher growth trajectory and in fact I must mention that for the 19:03 19 minutes, 3 seconds diesel exhaust fluid which needs technical grade ura there was a significant support from the government 19:11 19 minutes, 11 seconds to ensure that sufficient quantity is made available and vehicles keep running in an uninterrupted manner. 19:20 19 minutes, 20 seconds In smart city, we now have more than 3,815 cumulative buses, ebuses deployed with 19:28 19 minutes, 28 seconds almost 59 cr kilometers under the belt and we continue to deliver more than 96% uptime. 19:37 19 minutes, 37 seconds In the fleet business, subscription renewals almost doubled from Q1 to Q4 with launch of new value 19:46 19 minutes, 46 seconds propositions during the year. 19:51 19 minutes, 51 seconds On the sustainability side, very happy to note, happy to report that we had the highest 19:58 19 minutes, 58 seconds ever EV retails in Q4 since the fame incentives have been discontinued. 20:05 20 minutes, 5 seconds also on the back of the new products that we've launched including intraev in trucks 20:13 20 minutes, 13 seconds we signed an agreement with billionaire mobility and initiated the deliveries of 20:19 20 minutes, 19 seconds the 55 ton electric tractor and we work closely with the customers 20:27 20 minutes, 27 seconds to actually deploy these vehicles in their duty cycles. 20:33 20 minutes, 33 seconds We also signed an MOU with the VOCC port in Tamil Nadu for supplying and doing 20:42 20 minutes, 42 seconds trials of 40 hydrogen H2 ice trucks. 20:47 20 minutes, 47 seconds We have additionally received orders for around 250 electric buses. 20:56 20 minutes, 56 seconds Going ahead in Q1 for trucks, the priority is to drive 21:05 21 minutes, 5 seconds growth through the MY26, the model year 26 portfolio as also the higher payload variants and 21:14 21 minutes, 14 seconds the increasing battery electric vehicle portfolio. 21:18 21 minutes, 18 seconds In buses, the focus is on rebuilding market share on a profitable basis while converting the government tender pipeline into supplies. 21:29 21 minutes, 29 seconds For small commercial vehicles, the objective is to s sustain the volume momentum from ACEPro, ACE and intra 21:37 21 minutes, 37 seconds and build on the market share gains achieved in the later half of FI26. 21:44 21 minutes, 44 seconds For parts and services, the goal is to step up the growth to portfolio broadening and a fully digitalized demand and supply chain. 21:54 21 minutes, 54 seconds We are cautiously looking at near-term headwinds, especially 22:03 22 minutes, 3 seconds the commodity headwinds, which I already see a few questions being asked about, and a subdued sentiment in Middle East and North Africa. 22:14 22 minutes, 14 seconds Uh needless to add, I think diesel prices will remain a very very key monitorable. 22:20 22 minutes, 20 seconds But I think despite all this external noise, actually the freight availability 22:26 22 minutes, 26 seconds and the demand fundamentals remain first and with our refresh product portfolio, 22:33 22 minutes, 33 seconds I think we are placed well to manage this particular external headwind that we are seeing. 22:43 22 minutes, 43 seconds So that's the summary from our side. We get into question and answers now. 22:50 22 minutes, 50 seconds The first question is from uh Capel from Namura. 22:55 22 minutes, 55 seconds What is the growth outlook for MSCVs, LCVs in FI27 and how much risk do you see to this from fuel price hikes and do 23:04 23 minutes, 4 seconds you think it will be a more backended H2O to FI27 growth? Um okay and then maybe I'll take the next question. So 23:13 23 minutes, 13 seconds Capil on the growth outlook see the April volumes have also been good for the industry 23:21 23 minutes, 21 seconds and that we have seen a healthy double digit growth in April. 23:27 23 minutes, 27 seconds We have now been through almost half of May and 23:34 23 minutes, 34 seconds actually the momentum as I said the underlying demand fundamentals are still there. 23:42 23 minutes, 42 seconds As I said, I think we are monitoring all the external factors, especially the diesel prices 23:51 23 minutes, 51 seconds which will have a significant impact on how the market pans out because diesel will have at least 30 to 24:00 24 minutes 50% impact on the total cost of ownership and I think at this point of time I would say that we will have to 24:07 24 minutes, 7 seconds take quarter by quarter rather than projecting for the whole year with the kind of event that we are challenged 24:16 24 minutes, 16 seconds with and I would say therefore that despite this we should see a singledigit growth if not more in Q1. 24:28 24 minutes, 28 seconds uh I think uh that's what I would like to say at this juncture with regard to the growth outlook and as we get in 24:35 24 minutes, 35 seconds touch again probably we will be more wiser or this event would have been become more clearer for us to give a longerterm visibility. 24:45 24 minutes, 45 seconds The next question from couple itself but a lot of uh you know other people have also asked the same question is around commodity cost pressures. So how much of 24:53 24 minutes, 53 seconds it is expected in Q1? how much of it is getting passed on uh and what will be 25:00 25 minutes the competitive intensity like and uh the impact on margins what will be the drivers for margins from here 25:09 25 minutes, 9 seconds okay so I think the commodity headwinds are 25:16 25 minutes, 16 seconds certainly serious and we've already seen around 100 basis point impact in Q4 4. 25:26 25 minutes, 26 seconds Beyond the impact in Q4, we have also seen significantly higher impact being seen 25:34 25 minutes, 34 seconds in Q1, which is the quarter that we are in now. 25:39 25 minutes, 39 seconds Now to address this we have taken a 2% price increase the month of April 25:48 25 minutes, 48 seconds but we have decided to not pass on the entire commodity increases and 25:56 25 minutes, 56 seconds we will work on the cost levers because we don't want to impact the demand momentum by passing on the entire 26:06 26 minutes, 6 seconds commodity increases. So we will work on the cost side, expense side 26:13 26 minutes, 13 seconds to manage the financials. As far as margin drivers are concerned, Capil and since a few others have asked this 26:22 26 minutes, 22 seconds question, I would say clearly it will remain the same whether these commodity headwinds 26:28 26 minutes, 28 seconds are there or not which is about going on improving the value proposition for the customer. 26:36 26 minutes, 36 seconds And the second one is I think keep managing the costs, expenses and the expenditure 26:44 26 minutes, 44 seconds which is patrollable and in our hand. I think that's what I would say as far as the margins are concerned. 26:52 26 minutes, 52 seconds So next question from Nishit of Access. 26:55 26 minutes, 55 seconds Uh when will we start executing the orders of 70,000 units to Indonesia and will the entire order get delivered in FI27 itself? 27:07 27 minutes, 7 seconds So uh we have progressed well on the Indonesia order. I'm pleased to tell you 27:14 27 minutes, 14 seconds that we already have the product collocated in Indonesia and our first shipment is already on the 27:23 27 minutes, 23 seconds seas and we will actually ramp up the supplies uh quite rapidly. 27:32 27 minutes, 32 seconds I think we will probably talk about it as we go ahead and meet again quarters ahead in terms of what is going to be 27:41 27 minutes, 41 seconds the actual delivery timeline but of course we are trying to ramp up the deliveries pretty fast 27:49 27 minutes, 49 seconds you uh so Raman maybe you know this one coming your way what are the key reasons for delay in closure of the IECO deal 27:57 27 minutes, 57 seconds earlier we were expecting closure by April May and how are you looking at the acquisition position of a 6 to 7% stake 28:04 28 minutes, 4 seconds in ICO by an activist hedge fund from the market. How can this impact a deal closure or deal value? 28:11 28 minutes, 11 seconds Yeah. So I think good question Nish. 28:15 28 minutes, 15 seconds As you know has a strong global footprint right and getting approvals 28:23 28 minutes, 23 seconds from various regulators is time consuming. Despite that, I think we have received almost all the approvals 28:31 28 minutes, 31 seconds barring the last two financial regulatory approvals which are for France and Spain. We are working towards 28:39 28 minutes, 39 seconds closing this at the earliest and we expect this to kind of spill into Q2 and that's where our timeline for deal closure is going to be Q2. 28:51 28 minutes, 51 seconds On the second part of the question in terms of the on the investor I think we are confident that the ICO investor 28:59 28 minutes, 59 seconds would see value in our offer and would support the deal. 29:04 29 minutes, 4 seconds You next question is from Proote in creds have been dropping while is it because 29:13 29 minutes, 13 seconds of discounting trends or is it because of change in product mix? Um also 29:21 29 minutes, 21 seconds so I promote I'm happy that you have asked this question because actually we have also engaged we had also engaged offline with some of you to explain this. 29:32 29 minutes, 32 seconds No actually see the ASPs are not reducing segment by segment actually the ASPs are 29:41 29 minutes, 41 seconds increasing and in fact in trucks there is a healthy increase in ASPs on a Y basis. 29:51 29 minutes, 51 seconds The key reason for this drop wherein if you divide the revenue or the turnover with 30:00 30 minutes the number of vehicles sold is essentially due to the increase in number of vans in our portfolio in the 30:10 30 minutes, 10 seconds volumes and compared to last year we hardly have any electric buses being sold this year. 30:20 30 minutes, 20 seconds This alone is one very important reason for the change that one has seen in 30:29 30 minutes, 29 seconds terms of the ASPS and as we go ahead when we have electric buses coming back 30:36 30 minutes, 36 seconds into the volumes and also have electric vehicles sold in some of the other product lines actually we will see a 30:44 30 minutes, 44 seconds positive impact on the ASPs from promote itself A couple of other questions. Can you talk about 30:52 30 minutes, 52 seconds segment-wise drivers and challenges for FI27 uh and in SCVs with the new launches of 31:00 31 minutes EVs and L&T has the cost economics turned favorable to ease the onslaught of three-wheers? 31:08 31 minutes, 8 seconds So I think let me first answer the second question because it is a really good question. 31:16 31 minutes, 16 seconds So you know as a part of this quarterly connect I have engaged with most of the financials 31:24 31 minutes, 24 seconds both banks and NBFCs and invariably I have heard about improvement in the asset quality for all 31:33 31 minutes, 33 seconds of them in SC pickup and actually the answer to your question is actually yes wherein you have asked 31:42 31 minutes, 42 seconds whether with the launch of new LNT etc whether the cost economics have turned favorable. Yes, I think uh at 31:50 31 minutes, 50 seconds least the book quality asset quality for these vehicles has improved significantly for the financials 31:59 31 minutes, 59 seconds with EV launches of new EV. Yes, I think the operating economics are becoming quite favorable with two products 32:06 32 minutes, 6 seconds especially one is Ace Pro and second is the Intra and therefore we are seeing a 32:12 32 minutes, 12 seconds good pull for these vehicles. Now your question about segment wise drivers and challenges for FI27. See I would suggest 32:22 32 minutes, 22 seconds that we actually go quarter by quarter which is what I answered to Capil also and frankly at this juncture 32:31 32 minutes, 31 seconds we don't see any drop in rate availability. The real challenge in our view, the first immediate challenge 32:40 32 minutes, 40 seconds is going to be what happens to the diesel prices and that's something that we need to monitor. I think the freight availability 32:48 32 minutes, 48 seconds probably continues to be there across all the segments. Yeah. 32:54 32 minutes, 54 seconds Yeah. Sure. Uh Rau has also asked. 32:59 32 minutes, 59 seconds Yeah, I think most of the ones which you know Rau has said have been covered but I've got a question on u separately on WhatsApp. So maybe I'll read that out. 33:09 33 minutes, 9 seconds This is from Gungjan Bofa. 33:11 33 minutes, 11 seconds Can you talk about truck operator sentiment on ground more recently? What does your experience of past fuel price 33:20 33 minutes, 20 seconds in increases tell you about the industry cycle? What variables matter more from a cycle perspective? Does replacement 33:29 33 minutes, 29 seconds cycles still play out given the aging of trucks? 33:33 33 minutes, 33 seconds Okay, so actually Gujan, we have uh stopped doing that sentiment study 33:40 33 minutes, 40 seconds which I used to report every quarter. We are actually revisiting the entire methodology 33:47 33 minutes, 47 seconds to make it more relevant to the current uh market conditions and probably once we restart we will come back on that. 33:55 33 minutes, 55 seconds But if I were to put together some anecdotes and therefore tell you, I think uh 34:03 34 minutes, 3 seconds amongst the fleet owners, diesel prices and how they pan out will 34:11 34 minutes, 11 seconds is is actually one of the big question mark and due to that I think at times 34:21 34 minutes, 21 seconds the customers are postponing their purchase. decision making maybe closer towards the month end but this is 34:29 34 minutes, 29 seconds something which I think the heat owners the customers are going through largely on the heavy 34:39 34 minutes, 39 seconds side as you go down towards smaller vehicles I think the uncertaintity is lower is 34:46 34 minutes, 46 seconds what I would say which also probably indicates the freight availability as we go down and In fact, we have also 34:55 34 minutes, 55 seconds seen for the whole of last year pickup and IMCV ILMCV is five tons to 19 35:02 35 minutes, 2 seconds tons have actually showed the highest growth rates and we continue to see that 35:09 35 minutes, 9 seconds even in this particular quarter. So I think that's what I can answer right now in terms of sentiment. Gungjan, what was the second question? 35:18 35 minutes, 18 seconds Uh does replacement cycle still play out given the aging of drugs? 35:24 35 minutes, 24 seconds Yeah, I think see I've been saying this for you know true replacement being happening on ground 35:32 35 minutes, 32 seconds that means a truck being taken out from the system and then replaced by new truck I should see good number of trucks 35:39 35 minutes, 39 seconds coming to our scrapage centers but actually that still doesn't happen yes it may be true that we are not available 35:46 35 minutes, 46 seconds at all the locations but we are already there at 11 locations I think the inflow continues to be low And therefore in my 35:54 35 minutes, 54 seconds view uh the fleet owners do replace the trucks 36:01 36 minutes, 1 second after four to 6 years after the warranty period is over but I think it changes hands and then it continues to remain in 36:08 36 minutes, 8 seconds usage for smaller duty cycles lower distances uh lighter loads or whatever. But I 36:16 36 minutes, 16 seconds think some of these trucks continue to be there. But if I were to answer your question only for the large fleet owners 36:26 36 minutes, 26 seconds who replace their vehicles after 6 years four to 6 years I think we have been working on that data I would say that at 36:33 36 minutes, 33 seconds least probably 40% of the volume was uh related to the these large fleet owners replacing their trucks with new ones. 36:42 36 minutes, 42 seconds So just I believe we are having a technical glitch and people are not able to post the questions online. And so I'm getting them via email. So I'll be reading out as they come. 36:52 36 minutes, 52 seconds Yeah. So the next question again from Gujan. 36:56 36 minutes, 56 seconds Does the mid- teens AITA margin guide hold despite cost headwinds? 37:02 37 minutes, 2 seconds So Gujan whatever I answered to Capil and then promote holds good. I think at this juncture we will have to go really 37:10 37 minutes, 10 seconds quarter by quarter. And let me tell you I think the commodity inflation which has happened including rupee devaluation 37:19 37 minutes, 19 seconds it's quite severe and you know we are trying to fight it out and as I said obviously we are not passed on the whole 37:27 37 minutes, 27 seconds increases it's out of question because we don't want to completely destroy or disturb the demand growth momentum but 37:36 37 minutes, 36 seconds we have increased our cost side efforts and uh our Our endeavor will be to continue delivering good margins. 37:46 37 minutes, 46 seconds And if I may just add in just a correction GJ, our guidance was teens and not mid- teens. 37:55 37 minutes, 55 seconds Next. 37:55 37 minutes, 55 seconds Yeah. So international growth uh guidance given the uncertainty in neighboring markets. M 38:03 38 minutes, 3 seconds I think I I did answer this question uh in in response to question from promote but just to recap I think we do see some 38:11 38 minutes, 11 seconds pressure in uh Sri Lanka especially because of reduced availability of fuel 38:20 38 minutes, 20 seconds prices going up. We do see some impact in Middle East uh because of course the war is happening there. So we have had no 38:28 38 minutes, 28 seconds shipments to Middle East in the the last two months. We're trying to find out 38:34 38 minutes, 34 seconds alternate routes or logistics to ensure that the vehicles can reach there. Uh so that's what I see the impact right now 38:43 38 minutes, 43 seconds but we are trying to recover this through increase in uh volumes in other markets 38:50 38 minutes, 50 seconds and here the Indonesia order is also coming to our rescue. 38:55 38 minutes, 55 seconds So I would say that even on international market we will have to take it more quarter by quarter approach in view of the uncertaintities. 39:04 39 minutes, 4 seconds Okay. I think we've now uh resolved the glitch. So you can please post your questions on the chat itself. But in the 39:12 39 minutes, 12 seconds meanwhile while that comes uh sir Raman sir a question for you. Uh is there any clarity on the financing structure for Eco? 39:22 39 minutes, 22 seconds I think as we had shared earlier our initial plan for financing is going to be through a bridge loan and the 39:30 39 minutes, 30 seconds subsequent refinancing at this point of time all options are open. So we've kept both equity and debt 39:37 39 minutes, 37 seconds still open and I think closer to date we will finalize the percentage of equity or debt. 39:47 39 minutes, 47 seconds Yeah there is a question from Rahu which you have missed. 39:52 39 minutes, 52 seconds No he I mean quite a few of his questions we have answered but there is one question I will take 39:58 39 minutes, 58 seconds uh he I mean two questions he has asked can you please share Io F26 financials including defense if possible so no and 40:08 40 minutes, 8 seconds I mean in fact they have already released their results in the last uh week so you can have a look at those 40:15 40 minutes, 15 seconds uh you have asked a question what is supporting market share in tractor trailers buses and LCVs in recent times So 40:23 40 minutes, 23 seconds uh I think uh very clearly the new product launches and therefore the product superiority is 40:31 40 minutes, 31 seconds a clear one of the reasons that is supporting this. I think the new products that we've launched whether it 40:39 40 minutes, 39 seconds is higher payload, higher fuel efficiency are clearly or the Azura range I think these are the ones which are 40:47 40 minutes, 47 seconds driving higher traction. Uh I must also say that our strategy at 40:55 40 minutes, 55 seconds uh micro segmental level actions is also helping micro segmental level will be 41:03 41 minutes, 3 seconds for a geography and a particular end use segment we are having differing strategy and also prioritizing amongst those 41:11 41 minutes, 11 seconds micro segments. So that's something uh which is helping us. I must also add that with the customer success centers 41:20 41 minutes, 20 seconds now deployed across the country at more than 100 dealers, I think our service delivery has improved quite 41:27 41 minutes, 27 seconds significantly and a lot of proactive inputs we are being able to give it to the customers to improve the functioning 41:35 41 minutes, 35 seconds uptime and even sometimes the fuel efficiency delivery on the vehicles. I would say that all these things put 41:42 41 minutes, 42 seconds together has helped us to improve the market share. 41:48 41 minutes, 48 seconds Just a clarificatory question on one sorry uh yeah so this is from one moment 41:57 41 minutes, 57 seconds please there's a question from Tom Raman question I can I can take that. 42:06 42 minutes, 6 seconds Yeah. So the question is uh uh regarding the balance I evo approvals. Can you confirm whether the foreign investment 42:14 42 minutes, 14 seconds approval in France and change of ownership approval from the bank of Spain is 42:22 42 minutes, 22 seconds ahead with respect to your question just to clarify and as I said with the earlier 42:32 42 minutes, 32 seconds question too all approvals have been secured what is pending is 42:38 42 minutes, 38 seconds only the finance regular regulatory approval which is from France and Spain. 42:45 42 minutes, 45 seconds All FDI approvals have already been received. 42:50 42 minutes, 50 seconds Thank you. Uh yeah, so there's a clarificatory question from Adita. Uh yeah. 42:58 42 minutes, 58 seconds So Alita I think arithmetically you may be right but I think the message that I wanted to convey was with this kind of 43:07 43 minutes, 7 seconds uncertaintity very difficult to give a very specific number but still I think sticking neck out saying that we will certainly have a 43:15 43 minutes, 15 seconds singledigit uh growth in Q1 which is quite good. Coming to Capil, your question is about what the growth 43:22 43 minutes, 22 seconds outlook for EVs for LCVs and buses and uh about intra. Yes, I think Intraev 43:30 43 minutes, 30 seconds has got uh price positioned very very well and is at a uh very good spot and therefore 43:39 43 minutes, 39 seconds there is quite a bit of a demand which we have seen for intraev. 43:44 43 minutes, 44 seconds Uh regarding your point about supply challenges. So uh Capil, this is just the second month of uh production since 43:52 43 minutes, 52 seconds we started and we have a plan to ramp it up gradually as we go ahead and we are sure that we will be able to meet the demand. 44:03 44 minutes, 3 seconds In terms of EV penetration that we can expect in LCVs, I will say that couple for the whole of last year, 44:12 44 minutes, 12 seconds our penetration in SCV pickup of EVs was around 4%. 44:18 44 minutes, 18 seconds But if you look at towards the end of the year, especially last one or two months, this penetration has actually 44:24 44 minutes, 24 seconds picked to picked up to around 7%. So we do expect the penetration to be in this higher singledigit zone. 44:34 44 minutes, 34 seconds Next question from Nishit in H2 FI26 MCV demand panned out way too strong 44:42 44 minutes, 42 seconds compared to expectations. Any color what drove the same? What whether this was addition of capacity by fleet operators 44:49 44 minutes, 49 seconds or replacement demand and how much of was the role of stronger than expected pent-up demand in tippers and does the 44:57 44 minutes, 57 seconds strong growth in H2 make you cautious on FI27 demand apart from the other near-term concerns or do you think there 45:04 45 minutes, 4 seconds are more growth drivers? So I think H2 FY26 growth 45:12 45 minutes, 12 seconds was clearly driven by increase in consumption. I think that was very important driver and that led to higher 45:20 45 minutes, 20 seconds freight being made available and that translated into new purchases. Now those new purchases could be either to add 45:28 45 minutes, 28 seconds capacity or for replacement both. I mean I also answered Gungjun's question on what could be the likely replacement by the fleet owners. So that's where we are 45:37 45 minutes, 37 seconds and uh I think see separately you guys only have asked a question that uh MNSCV 45:44 45 minutes, 44 seconds or HCV volumes are still lower than FY19 peak in volume terms then I answer that you know in tarnish terms we are higher 45:53 45 minutes, 53 seconds so frankly still there is a headroom if and I've been saying I mean generally 45:59 45 minutes, 59 seconds one uh you know algorithm or one equation correlation seems to be emerging that if the GDP growth is somewhere 46:08 46 minutes, 8 seconds around X then closer to that is also the CGR in uh freight road freight BTKM and 46:16 46 minutes, 16 seconds as road freight keeps on increasing we will see addition of capacity uh in even in MSC as far as stippers is 46:25 46 minutes, 25 seconds concerned I must say that post uh rainy season that is September there has been a 46:33 46 minutes, 33 seconds significant uptick even in tippers which is because uh I think the infrastructure activity also picked up so that's something that 46:41 46 minutes, 41 seconds we have seen uh we were we are still seeing good demand good pull for the tippers but of course we will now 46:50 46 minutes, 50 seconds shortly be entering into the rainy season which is typically a very low demand season for tippers and maybe 46:57 46 minutes, 57 seconds after that we'll be in a position to then give better visibility of what's likely to happen in H2 No, 47:04 47 minutes, 4 seconds some questions that we've got uh by email. Can you tell us a little bit more about what's happening in the EV bus 47:11 47 minutes, 11 seconds market? Why were we not participating or uh Yeah. So see in the electric uh bus 47:19 47 minutes, 19 seconds tenders we have participated in the last two CSL tenders and I think in the first one out of 47:28 47 minutes, 28 seconds those we were close to L2 in one of the sub 47:36 47 minutes, 36 seconds part of that entire tender and the second tender I think the tender has just got opened yesterday. I think 47:44 47 minutes, 44 seconds across we see two things. One is the government has addressed our requirement of payment security mechanism 47:52 47 minutes, 52 seconds and also asset light model which is there. But in our view and with more than 50 cr kilometers under the belt 48:00 48 minutes more than 3,3 400 buses I think the current uh set of uh ports which are 48:09 48 minutes, 9 seconds coming are in our view unsustainable. So we are therefore going in a very prudent manner in this particular business. 48:19 48 minutes, 19 seconds But let me add I think we have been also pretty active on promoting electric bus travel now in 48:27 48 minutes, 27 seconds corporates especially for employee travel. We are also engaging with some customers for other applications 48:36 48 minutes, 36 seconds intra city inter city in mostly intercity sorry uh for uh uh and this we 48:43 48 minutes, 43 seconds believe will also start bringing some volume to us. So that's where we are in terms of uh electric buses. 48:51 48 minutes, 51 seconds Thank you. Um Raman a couple of questions coming your way. Uh this one's from Amin JP Morgan. Historically we 48:59 48 minutes, 59 seconds have seen very large working capital inflow in 4Q which leads to a disproportionate increase in FCF. 49:07 49 minutes, 7 seconds This time the seasonality seems to be weaker in this regard. Anything to call out here and the second question is on 49:14 49 minutes, 14 seconds the capex guidance for FI27 whether there are any specific areas of investment that we are looking at. 49:22 49 minutes, 22 seconds I think a good question on the cash. I mean as you are aware CV business is very cyclical in nature. Historically we 49:30 49 minutes, 30 seconds have experienced working capital burn quarter on quarter with Q4 being an exception. 49:37 49 minutes, 37 seconds But I think FYI26 with our sustained focus on disciplined working capital management, the large sinks historically 49:46 49 minutes, 46 seconds concentrated in Q4 have been more evenly managed through the year resulting in a more stable, 49:54 49 minutes, 54 seconds predictable and consistent cash flow. So on a YTD basis, post Q2, we've been 50:02 50 minutes, 2 seconds consistently positive, which is not how it was historically. 50:07 50 minutes, 7 seconds Coming to your question on capex, I think for the last couple of years we've been giving guidance on capex of 2 50:15 50 minutes, 15 seconds to 4% of revenue and we've been very consistent in meeting that FY26 also we 50:24 50 minutes, 24 seconds are well within the guidance and despite this gap I think our focus on 50:32 50 minutes, 32 seconds investment in priority areas new technology Y has always been 50:38 50 minutes, 38 seconds prioritized. So we expect FY27 also our guidance would remain similar 2 to 4% of revenue. 50:47 50 minutes, 47 seconds Yeah, I don't think we have any other questions on the call. Uh I think with that we can conclude the call. Thank you 50:55 50 minutes, 55 seconds very much for joining in and for any other questions happy to connect offline. Thank you so much.