Vardhman Textiles — Q4 FY26

Vardhman Textiles Ltd Q4 FY2025-26 Earnings Conference Call https://www.youtube.com/watch?v=dLgCso02qE0 Published: 5 days ago

0:02 2 seconds Ladies and gentlemen, good day and welcome to the Verde Textiles Limited 4Q FY26 earnings conference call hosted by 361 Capital. 0:13 13 seconds As a reminder, all participant lines will be in the listenon only mode and there will be an opportunity for you to ask questions after the presentation concludes. 0:23 23 seconds Should you need assistance during the conference call, please signal an operator by pressing star then zero on your touchstone phone. I now hand the 0:32 32 seconds conference over to Miss Arja Jan from 361 Capital. Thank you and over to you ma'am. 0:39 39 seconds Thank you Shelindra. Good evening everyone. On behalf of 361 Capital I welcome all participants and the 0:46 46 seconds management of Aduman textiles to the 4Q FI26 call. From the management we have Mr. Nir Jen, Joint Managing Director, 0:55 55 seconds Mr. Sushil Jam, Director Raw Materials, Mr. Rajiv Taper, CFO, Mr. MKkesh Bansil, 1:03 1 minute, 3 seconds Head of Fabric Marketing, and Mr. Bun Malhotra, head of finance. Without further ado, I would like to hand over 1:11 1 minute, 11 seconds the call to the management for their opening remarks post which we can open the floor for the Q&A session. Thank you and over to you, sir. 1:20 1 minute, 20 seconds Uh, good evening everyone. Thank you for joining uh the fourth quarter call. The results are available to you. This 1:29 1 minute, 29 seconds period last six months have been there are some good and some bad news. Uh the good news is one the US tariffs were 1:37 1 minute, 37 seconds over. As a result of that India became more competitive. So the kind of desperation which was there for our government exporters of the home 1:45 1 minute, 45 seconds textiles that's over and things have started moving back to the right direction. 1:50 1 minute, 50 seconds Also this was a period where we started looking at a uh new geopolitical concerns starting with the Iran and US 1:59 1 minute, 59 seconds war which created some of the disadvantages of some of the disruptions in the system be it logistics be it crude which has impact on the various 2:08 2 minutes, 8 seconds businesses including the textile business which I'll come to a little later also this was a period where the cotton 2:15 2 minutes, 15 seconds prices started going up internationally in New York future from 61 1 62 63 cents 2:22 2 minutes, 22 seconds went to as high as 8283 cent and as a consequence of that the uh Indian port 2:29 2 minutes, 29 seconds also moved from 52 53,000 rupees a candy to about 68 67 67 68,000 rupees a candy 2:36 2 minutes, 36 seconds so which means uh the the cost of raw gear increased in a big way this period there has also been improvement in the 2:44 2 minutes, 44 seconds yarn prices uh both on account of the raw material push as well as the better demand also which I'll come again a 2:51 2 minutes, 51 seconds little later and in between the dollar rupee also moved so which was also uh 2:58 2 minutes, 58 seconds beneficial as most of the textile is based upon the exporting community so some advantage came because of that also 3:05 3 minutes, 5 seconds so these have been the macrolevel events now we can look at it one by one 3:12 3 minutes, 12 seconds clearly the US tariff that's have given an advantage I understand the export the 3:19 3 minutes, 19 seconds the utilization of exporters who were directly exporting to USA from India be home or be the government exporter had 3:28 3 minutes, 28 seconds come down to about 50 to 60% in this period also they were giving heavy discounts to the US giants uh to the 3:36 3 minutes, 36 seconds extent achieved to compensate 25% as the beauty was 50%. So as a result of that their margins were effective and many 3:44 3 minutes, 44 seconds products they were losing money. As a result of that they were shy of taking those orders and as a result of again 3:51 3 minutes, 51 seconds that there has been uh major issues and concerns for those uh exporting community. Since we are the producer and 4:00 4 minutes we provide the material to them and they were not doing good. So there was a pressure on the bad process also. So all the people who were who were supplying 4:09 4 minutes, 9 seconds either yarn or fabric to the garment exporters they were also under a difficult situation either on account of 4:16 4 minutes, 16 seconds a lower uh both on account of the lower realization as well as the lower utilizations 4:22 4 minutes, 22 seconds as soon as the US tariffs were away slowly the business started coming back and I understand as of now both home 4:31 4 minutes, 31 seconds textiles and the garment exporter to the USA they're running almost 90% 100% 4:38 4 minutes, 38 seconds capacity utilization and as a result of that from the country they uh the overall export is better and also since their utilization is better the overall 4:46 4 minutes, 46 seconds demand of the yarn is also better. So there's been a favorable factor in this period to start with. The second major event was the prices of raw material. 4:59 4 minutes, 59 seconds Now you look at the last two years the New York future was continuously coming down came down to one of the historic 5:07 5 minutes, 7 seconds lower levels of 62 63 cents and uh I think this was a level where the the 5:14 5 minutes, 14 seconds farmers are not actually earning a lot internationally. So there was a fear whether the cotton c will come down or 5:21 5 minutes, 21 seconds will increase. So it was all a concerns and issues which were there in our mind in between 5:28 5 minutes, 28 seconds there was a weather bad weather condition which was announced by USA in the Texas areas where it is uh as of now 5:36 5 minutes, 36 seconds it is projected that 91% drought conditions are there and uh it is likely the overall crop size in USA will come 5:44 5 minutes, 44 seconds down also the Australian crop size got reduced from 55 million where it was expected to be about 41 million bales. 5:54 5 minutes, 54 seconds The Indian crop also came down against the last year of about 31 31 and a half million uh bales. This year it is 6:02 6 minutes, 2 seconds projected to be about 39 million BS only and the Brazil also was not increasing. 6:08 6 minutes, 8 seconds There was a possibility either the same or small reduction in that also. As a result of that the overall cotton stocks 6:16 6 minutes, 16 seconds which we saw increase in the closing stocks of cotton worldwide last two three years that got balanced or rather 6:22 6 minutes, 22 seconds it was projected that the we will be the world will be reducing the closing stock of cotton maybe to the extent of half 6:30 6 minutes, 30 seconds million ton to 1 million ton and the moment it was realized there was this was one of the factor where the prices of cotton started going up in the international market. 6:40 6 minutes, 40 seconds Two, as the tension started in Iran and USA, the group prices started increasing which has a direct impact on on man-made 6:50 6 minutes, 50 seconds fibers especially polyester and the polyester prices increased in this way in a big way and as the cost increased because of the crude all the synthetic 6:58 6 minutes, 58 seconds fiber prices started increasing. You look at acrylic fiber the prices increased almost by about 80 85 rupees a kg in this period. for fiber prices 7:08 7 minutes, 8 seconds increased by 2530 rupees a kg and all other stylistic also started increasing. 7:13 7 minutes, 13 seconds So somewhere somewhere it looks like the the cotton fiber also got a sympathetic increase on account of that also since 7:21 7 minutes, 21 seconds the synthetic prices were increasing somewhere I think that was a support given uh which was uh which the cotton 7:28 7 minutes, 28 seconds fiber got and the prices were also standard to that extent. Third since the the demand in this period started 7:37 7 minutes, 37 seconds improving. So there are two factors how the demand started improving pre I'm talking of starting in the month of 7:44 7 minutes, 44 seconds October or so the two factors on the spinning side which had happened in last some time one since the industry was not doing well. 7:55 7 minutes, 55 seconds So we understand as per the industry data estimate that total of about 11 11 and a half million spindles are stopped 8:03 8 minutes, 3 seconds permanently into the system. I said earlier also our repeat capacity in India was 53 million spindles. Normally 8:10 8 minutes, 10 seconds we add about 2 2 and a2 million spindles every year and if you go by the normal years our capacity this year should have been about 59 60 million spindle. 8:21 8 minutes, 21 seconds Against that last three years there was hardly any expansion happening but contrary to that 11 12 million spenders got permanently stopped into the system. 8:30 8 minutes, 30 seconds So practically the the working capacity today in India will not be more than 41 42 million spenders as per the industry estimate. There's no government data 8:39 8 minutes, 39 seconds available but this is the industry estimate which means there was some balancing of the spinning availability or the yarn availability uh came into 8:48 8 minutes, 48 seconds the system where the overall production came down. This was one factor where the surplus capacity got vanished. Two, we 8:55 8 minutes, 55 seconds saw uh geopolitical tensions issues concerned in Bangladesh 6 months before. 9:03 9 minutes, 3 seconds So because of that I think some of the brands or some of the orders got transferred to China also. So there was 9:10 9 minutes, 10 seconds local Chinese demand there was export uh Chinese demand some orders shifting from Bangladesh to China and China 9:18 9 minutes, 18 seconds if you look at the Chinese cotton total they they have about 80% of their consumption they have the they have their internal cotton and 20% they 9:27 9 minutes, 27 seconds import from outside and out of the 80% which is their internal production 80% of that comes from Zingan area which is 9:35 9 minutes, 35 seconds banned by the USA as of now so it looks either the brand suggestion or the local Chinese manufacturers they decided 9:44 9 minutes, 44 seconds rather than buying the local yarn they started importing cotton yarn from India from different countries including India 9:51 9 minutes, 51 seconds the prices were low so they started buying big quantities of yarn from India and suddenly starting October November 9:58 9 minutes, 58 seconds we found the yarn demand to be very good in the export market and the prices started going up for the yan also 10:06 10 minutes, 6 seconds India the normally export about 100 million kg of jan every month. It is the average for last 2 three four years and 10:14 10 minutes, 14 seconds out of that China used to be about 7 or 8 million kg only. But if you look at the last four five months data, China is consistently buying about 30 million kg. 10:24 10 minutes, 24 seconds So practically another 20 million kg demand came to India and Indian exports started reaching or touching almost 10:31 10 minutes, 31 seconds about 120 million kg plus. So this became the yet another factor where the yarn prices started improving uh in a 10:38 10 minutes, 38 seconds far better way not only to compensate the cotton prices but definitely beyond that and suddenly spinning margin 10:46 10 minutes, 46 seconds started improving into the system. So this demand of China continues even today also and I think most of the spinners they're sold for about two to 10:55 10 minutes, 55 seconds three months in forward as of now as far as the export is concerned and to that extent they try to cover the cotton also. 11:03 11 minutes, 3 seconds two since on the Indian side the Indian crop size is not likely to be more than 29 million BS and going by this 11:12 11 minutes, 12 seconds increased activity of yam it is expected the arful year consumption can be in the range of about 33 million or 34 million 11:19 11 minutes, 19 seconds BS. Now suddenly there was a realization that the cage cotton is not available in India and there was the the various 11:28 11 minutes, 28 seconds industries including or the uh various industries they started going to the government to allow the duty-free import 11:35 11 minutes, 35 seconds of cotton so that uh by the time we finished our existing cotton there should not be a shortage of cotton into country. The ministry of textile could 11:45 11 minutes, 45 seconds understand and they took a total view with the industry and they wrote it to the finance ministry and the agriculture ministry that this likely to be a 11:51 11 minutes, 51 seconds shortage of cotton going by the uh better activity and the better profitability of the spinning sector. So the cotton should be allowed beautifully 12:00 12 minutes coming to India so that there's no shortage of cotton in the month of August, September of Fugar or so and so on. 12:07 12 minutes, 7 seconds uh this information also spread into the system that India is likely to open the cotton whether full time or maybe 6 12:15 12 minutes, 15 seconds months I do not know what government decision would be whether they'll take a decision or not we are not sure but definitely the market perceived the 12:23 12 minutes, 23 seconds Indians will buy to buy more cotton internationally so which also gave some uh strengthening to the media future in 12:30 12 minutes, 30 seconds this period the third factor was as the cotton started going up I Understand the hedge money or the speculative money 12:38 12 minutes, 38 seconds also started coming to this trade and today uh the last two three years where the speculators as per the data which is 12:46 12 minutes, 46 seconds available in the system they were negative or they were short on the future they started going long on the near future. So which means the cotton 12:54 12 minutes, 54 seconds in uh uh the 8082 sense level uh got stabilized in this period. 13:02 13 minutes, 2 seconds Now this brought this has a big advantage with New York future remains at 8082 cents for the Indian market. 13:09 13 minutes, 9 seconds India had a peculiar situation where our cotton prices were very high because of the minimum support price. So CCI was acquiring cotton but they were buying 13:17 13 minutes, 17 seconds cotton they were selling into market but at the same time there was a loss which was coming to the CCA in this period. As soon as the cotton started going to 13:25 13 minutes, 25 seconds about 882 cents near future the Indian cotton prices became aligned to the world market and as of now even going by 13:34 13 minutes, 34 seconds our MSP our cotton is not expensive compared to the world market rather it is aligned to the long-term average we 13:42 13 minutes, 42 seconds which we used to look at it always in last 15 20 years that we are new future plus 5 to uh 8 cents cotton which is 13:50 13 minutes, 50 seconds prevailing as of now. So suddenly our c the all the spinners which were losing money on account of a very high cotton 13:57 13 minutes, 57 seconds prices that factor also was uh uh that also got aligned into this system last couple of months and as a result of that 14:05 14 minutes, 5 seconds the spending margins were normal which earlier was not sufficient or was not normal because we were very very expensive on the cotton 14:14 14 minutes, 14 seconds the New York future whether it's a pain or not I'm not very sure but definitely if you look at the other countries 14:21 14 minutes, 21 seconds So India today our cotton prices are 87 88 cents. New York future with the 84 82 83 84 cents. The Brazilian cotton is 14:30 14 minutes, 30 seconds available at 94.95 cents which is aligned to it. The Pakistani cotton which is inferior to Indian cotton is again aligned to 85 86 cents. So which 14:39 14 minutes, 39 seconds is in line with the with the normal relativity. And also the Chinese cotton today are in the range of about 103 104 14:47 14 minutes, 47 seconds cent which normally they're always higher in India by about 15 cents or so which is also today as of now aligning 14:54 14 minutes, 54 seconds to that also. So today there's hardly any disruption as far as the long-term in the cotton prices have have been in 15:02 15 minutes, 2 seconds this uh the relative to each other. So in this period the cotton to Indian spinners was available at a right price. 15:12 15 minutes, 12 seconds Yan demand was okay. The prices started improving. Just to give you an idea the lowest prices of yan in the month of 15:20 15 minutes, 20 seconds November December were ranging about $2.65 to $2.70 15:26 15 minutes, 26 seconds uh for 30 comb. Today the came ranging between $3.30 to $3.35. 15:35 15 minutes, 35 seconds Same way the another advantage which came to India that with the rupee moving from 90 to about 94.95 the our cotton cost in terms of US cent 15:44 15 minutes, 44 seconds came down and also the conversion was better available to the Indian textile producers not only thinner to the everyone who is exporting. So the 15:53 15 minutes, 53 seconds operation to some extent was viable as far as the spinning is concerned which we saw after 2 three years. going 15:59 15 minutes, 59 seconds forward with the next uh upstream products the fabric margins were very good uh before uh the increase in the 16:09 16 minutes, 9 seconds yarn prices and uh I think now slowly because the overall demand is good even for the fabric also the demand is not 16:16 16 minutes, 16 seconds bad so everyone is trying to increase the prices there's always a resistance whenever the prices goes up to increase 16:23 16 minutes, 23 seconds on the asking products and vice versa of that whenever the yarn prices goes the garment or the fabric prices doesn't 16:31 16 minutes, 31 seconds go down in the same fashion. So the fabric also they have increased the prices. So but there's always a lag of 16:38 16 minutes, 38 seconds two to three months and I hope going by our position today or most of the other fabric producers both either knitting or 16:45 16 minutes, 45 seconds the woman it looks like that uh we are trying to to push the system and we would be in a position to get that increase hopefully in the times to come. 16:56 16 minutes, 56 seconds Same is situation with the governmental where they are now trying to increase the prices. So one they've got an advantage because of the donor rupee 17:03 17 minutes, 3 seconds also they're trying to push with the brands to increase the prices and it's always a part of negotiation we have to see but uh definitely going by the total 17:12 17 minutes, 12 seconds increase it looks like the brands have started talking to increase the prices few brands are starting giving small increases but I think it's a time where 17:20 17 minutes, 20 seconds we have to look at maybe next one two months you know more uh uh more clarity comes on this issue so second on our 17:28 17 minutes, 28 seconds capacities In between we have taken kurdan has taken a very big capex plans on the spinning side it was more of a 17:36 17 minutes, 36 seconds modernization I'm happy to share almost 90% of the modernization got completed in this period and whatever is left I 17:44 17 minutes, 44 seconds think this current financial year next 6 months will complete and as a result of that we're much more strong on the stock 17:51 17 minutes, 51 seconds floor both in terms of flexibility uh quality and also the cost factors and I'm sure that advantage it would come to 17:59 17 minutes, 59 seconds us in the future times both in terms of the cost as well as because of flexibility better products which we can produce and give it to the various 18:07 18 minutes, 7 seconds customers. The fabric side there are two major expansions we have taken. One was the performance fabric which plant was 18:14 18 minutes, 14 seconds commissioned uh during the last financial year. So I think uh normally it takes about 6 to 9 months time for 18:21 18 minutes, 21 seconds the orders to come in as it's a new venture for us. So I hope next 6 to 9 months we should be in a position to utilize it fully or better utilization 18:29 18 minutes, 29 seconds will happen where uh and we hope that this will be a new line for us where the lots of expansion or the major expansion 18:38 18 minutes, 38 seconds can come in as there are hardly any players for uh 100% synthetic into uh in India. The second factor was the fourth 18:46 18 minutes, 46 seconds line which was of cotton and normal uh fabric production which was also commissioned during the year but as far 18:53 18 minutes, 53 seconds as soon as we commissioned that line there was this issue of US so practically we couldn't uh uh utilize that capacity but slowly we started 19:02 19 minutes, 2 seconds building on that also in terms of our volumes we would be doing one of the highest today but still we have unutilized capacity which I expect maybe 19:10 19 minutes, 10 seconds next 6 to 9 months time we should be in a position to complete that in addition to that there was there's a huge expenditure we wanted to or we are doing 19:18 19 minutes, 18 seconds on on green power be these biomass boilers etc etc all those uh projects are likely to be commissioned in next 19:26 19 minutes, 26 seconds one to two months and uh after that I think June or July onwards we should start getting advantage of that also both in terms of green power as well as 19:35 19 minutes, 35 seconds some cost reduction possibility going by these raw material differentiations as of now so these are this This is what is 19:43 19 minutes, 43 seconds in this period the major changes which have happened. So now I think the remaining parts we can cover in the QA session. 19:54 19 minutes, 54 seconds Thank you. 19:56 19 minutes, 56 seconds Thank you sir. Thank you very much. We will now begin the question and answer session. 20:02 20 minutes, 2 seconds Anyone who wishes to ask a question may press star and one on the test on telephone. 20:07 20 minutes, 7 seconds If you wish to remove yourself from the question queue, you may press star and two. 20:13 20 minutes, 13 seconds Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question Q assembles. 20:48 20 minutes, 48 seconds The first question is from the line of sanch Gupta from S investment. Please go ahead. 20:55 20 minutes, 55 seconds Hello sir. Am I audible? Yes you are. 20:58 20 minutes, 58 seconds Hi uh thank you for the opportunity and congratulations on your decent set of product. So I just had few queries regarding the industry and the business. 21:07 21 minutes, 7 seconds So firstly as you said the prices uh the earlier our cotton price Indian cotton prices used to trade at a premium to US 21:15 21 minutes, 15 seconds cotton but right now it is trading at par. So how has this impacted the demand for yarn? I know you mentioned that the 21:23 21 minutes, 23 seconds uh demand in the yarn is better though it is also visible in the realization that if we see the realization for de 21:30 21 minutes, 30 seconds yarn and we are we able to pass it on to the customers so the yarn prices are determined by the 21:38 21 minutes, 38 seconds international cotton whatever even if our cotton is expensive we can't pass it on because that's an Indian phenomena 21:46 21 minutes, 46 seconds only so one the in any case the yarn prices whatever the cotton internationally that is determined by 21:53 21 minutes, 53 seconds the international market and even if cotton is expensive that has to be bonus that's first point two since the overall demand was better so both on account of 22:02 22 minutes, 2 seconds the demand as well as increase in cotton prices that could be passed on comfortably to the customer as of now 22:11 22 minutes, 11 seconds okay okay understood sir uh and on the demand side sir like how is the demand shaping up with uh uh US has opened up 22:19 22 minutes, 19 seconds right uh both and demand is as of now the demand of yan is very good if you look at most of the US 22:27 22 minutes, 27 seconds brands the first quarter number there's a increase of the retail size increased from 4% to 10% of the various brands the 22:36 22 minutes, 36 seconds demand from us is really good and as a result of that I think the overall textile demand as of now seems to be 22:42 22 minutes, 42 seconds pretty good or s if we move on to the public segment like how is the industry situation 22:51 22 minutes, 51 seconds panning up right now like you said that there was a there is a price have increased but there is a lag so how is 22:58 22 minutes, 58 seconds the customer conversation shaping up the customer is very clear they don't want to give any increase but I think 23:06 23 minutes, 6 seconds since the raw material price we are increasing the the intermediary products they don't have a choice but they not nobody would like to keep it to take the 23:13 23 minutes, 13 seconds losses so everyone is trying to push the prices and some increases are happening uh selectively it's not that the indies 23:22 23 minutes, 22 seconds are not happy but as I mentioned there's always a lag and whenever you want to do a new business there always be a resistance but within every week every 23:30 23 minutes, 30 seconds month every order there's some price increase which we are pushing to the customers 23:38 23 minutes, 38 seconds sir and on the thread side like have the threads also improved from post tar 23:47 23 minutes, 47 seconds on the yarn segment improve. 23:51 23 minutes, 51 seconds Yes, that definitely has improved as I mentioned because our spread was lost was less because our cotton was very expensive. So since our cotton is going 23:59 23 minutes, 59 seconds to be international market our spread they're definitely improving like if you can quantify that in some 24:08 24 minutes, 8 seconds numbers. So if you if you look at the Indian prices today the cost of Indian prices is about uh 85 87 88 cents. 24:20 24 minutes, 20 seconds So if I convert uh 87 cents 24:28 24 minutes, 28 seconds it comes to about $2 35 38 cent or so and with a price of $3.30 30 cents today 24:35 24 minutes, 35 seconds with this kind of a rupee I think 90 95 cents uh spread is available which 4 24:41 24 minutes, 41 seconds months back was only about 60 65 US okay so there is a 50% jump in this uh 24:49 24 minutes, 49 seconds spread that we can see uh from the worst to the best because this happened slowly the impact will 24:56 24 minutes, 56 seconds come in the times to come but yet 40 50% spread improvement is there as of now Sir is sustainable like can we go ahead 25:05 25 minutes, 5 seconds with this number or will there will be some correction we say if the prices of the yarn comes down so as I mentioned 25:12 25 minutes, 12 seconds there are two issues which are beyond our control one near future will come down or not I'm not very sure but if 25:19 25 minutes, 19 seconds near future remains at these levels practically the Indian MSC issue or the art is going beyond a point that issue 25:27 25 minutes, 27 seconds can be taken care of but new future could go up or not it's something I can't On the demand side as I mentioned since 25:36 25 minutes, 36 seconds the demand from the China has been good in this period because they are full of orders from the various brands. Look at 25:43 25 minutes, 43 seconds I think to that extent it looks like it can be sustained for some period of time. 25:49 25 minutes, 49 seconds Thank you sir. Mr. Shupta we request you to join me back in the case. I I 25:59 25 minutes, 59 seconds the next question is from Churag Sidwa from Baja JMC. Please go ahead 26:07 26 minutes, 7 seconds for the opportunity. My first question pertains to the industry dynamics. Sir, as you indicated close to around 11 and a half million spindles are off the 26:15 26 minutes, 15 seconds market. So sir, as per your experience, let's assume that these healthy spreads sustained for a longer period of time. 26:23 26 minutes, 23 seconds How much period would it take for these capacities to come back into the market or is it more structural in nature? 26:30 26 minutes, 30 seconds People are right now not investing and it might take couple of years to again come back to that 50 53 million spindle capacity. 26:38 26 minutes, 38 seconds You know there are two things which has changed in this time. One okay it as per the industry estimates only again the total number of spenders 26:48 26 minutes, 48 seconds in India was 53 million. At the same time the number of days were close to about 3,000. We understand the 11 m 26:56 26 minutes, 56 seconds spenders which are off the system almost 1,000 factors have gone shut down. So which means the overall indirectly with 27:05 27 minutes, 5 seconds some consolidation of the industry happened. So all these small screening capacity 4,000 6,000 8,000 spenders which in many case was very very 27:13 27 minutes, 13 seconds difficult to manage in today's time. I think that's one segment which is going off to the system. 27:21 27 minutes, 21 seconds Two, the industry has passed through a very very difficult time last two three years. So nobody is looking at a very 27:29 27 minutes, 29 seconds big expansions to start immigration. I think everyone is looking at more clarity on the board policy of government and what happens and my 27:38 27 minutes, 38 seconds feeling is in case these margins or this kind of a corn prices to gain for next 3 to 6 months then people will start looking at more projects to come in into 27:47 27 minutes, 47 seconds the system. You go to the to the machinery manufacturers which are one of the best way to measure what is 27:55 27 minutes, 55 seconds happening on the industry side or especially on the expansion side their utilizations are improved but more from 28:02 28 minutes, 2 seconds the modernization orders rather than the expansion orders as of now. So people have started working on the expansion side. As of now there are not really 28:09 28 minutes, 9 seconds very big projects which have started working on it and I feel uh maybe next month 9 months time people will wait 28:17 28 minutes, 17 seconds before they can start up or they start taking up the the new projects. Two industry definition will be more 28:24 28 minutes, 24 seconds consolidated. So those 4,000 6,000 8,000 parts will never come back into the system and if it better organ comes back 28:32 28 minutes, 32 seconds in the system which are more concerned sustainable in terms of the profitability extract the overall structure my personal view is we keep 28:40 28 minutes, 40 seconds improving on the year onwards 28:53 28 minutes, 53 seconds Mr. Chair Okay, we will take the next question. 29:00 29 minutes The next question is from Parani Duta from Mansura Financials. Please go ahead. 29:06 29 minutes, 6 seconds Yeah, good evening sir. Sir, I have two questions. The first one, our operating profits are not uh looks as good as 29:13 29 minutes, 13 seconds maybe people like Nitten Spinners or GSPL textiles. Is it because the fabric price increase will happen with a lag 29:20 29 minutes, 20 seconds and hence Q1 numbers would show more of it? Yeah, that's that's likely to happen. 29:30 29 minutes, 30 seconds Okay. And uh sir uh and what will uh what were the what was the export percentage for the quarter uh export as 29:38 29 minutes, 38 seconds a percentage of revenue for this quarter versus y same time last year? 29:44 29 minutes, 44 seconds Uh direct export company as a whole has always been the range of about 44 45% plus - 1 2%. 29:51 29 minutes, 51 seconds Okay. So this is as a percentage of revenue, right? Yes. 29:57 29 minutes, 57 seconds So this has been maintained. I mean there has been no issue on Okay. So sir then the then is it fair to 30:04 30 minutes, 4 seconds say that uh we would do like since exports have not been impacted. So with the fabric doing better we'll do much better in Q1. Can can we say that? 30:14 30 minutes, 14 seconds Meaning what I mean to say in short our performance in Q4 uh was it not as much as it could have been just because of 30:22 30 minutes, 22 seconds the fabric part which will which takes a lag effect. 30:28 30 minutes, 28 seconds Uh I mean going by going by the spread improvements which is looking like as of now I think uh most of the most of the 30:36 30 minutes, 36 seconds textile companies should do far better in the first quarter. Okay. 30:42 30 minutes, 42 seconds And suppose sir including including our company including sir and what what with these higher 30:50 30 minutes, 50 seconds cotton costs uh which have come in even then it should be okay as you said the current the current cost and current 30:58 30 minutes, 58 seconds yarn prices the spreads are okay so one can assume even Q2 assuming the current status remains even Q23 could be better 31:06 31 minutes, 6 seconds assuming the current spreads remain and that's true so assuming the current prices of yam, current dollar rupee and 31:14 31 minutes, 14 seconds the current prices of cotton it will be better compared to the last year and anyone or if if they have cotton 31:21 31 minutes, 21 seconds available to them which is at a cheaper price that advantage would be should be additional available to them. Okay. And 31:28 31 minutes, 28 seconds sir, year end this time we are having what? 3 months inventory or bit more for cotton. 31:48 31 minutes, 48 seconds Okay. 6 to 8 months cotton you have at your ends 32:11 32 minutes, 11 seconds I'm trying to explain you the cotton in India comes in the month of October most of this gets vanished by March 32:18 32 minutes, 18 seconds So most of the companies on March numbers will have six to seven months inventory most of the companies. Okay sir. 32:27 32 minutes, 27 seconds Thank you sir. Thank you. Thank you. 32:30 32 minutes, 30 seconds The next question is from Prashant Rishi from Cascad Capital. Please go ahead. 32:36 32 minutes, 36 seconds Uh good evening sir. Sir I just wanted to expand on the last point that you made. Uh since bulk of our procurement has happened by the financial year end 32:44 32 minutes, 44 seconds types. Uh so uh what would be the average cost of cotton that you procured because that will be the base for the 32:52 32 minutes, 52 seconds cotton for the rest of the financial year you know so I will not be I will not like to give 33:00 33 minutes the number that what cost are bought but I can give you how the market has behaved in this period if you look at today's price of CCI selling it is 33:09 33 minutes, 9 seconds 67,000 rupees a candle and they increased this price almost by 5,000 rupees in last one week only. So 33:16 33 minutes, 16 seconds practically the CCI price 1 month before was 57 58,000 rupees. 33:22 33 minutes, 22 seconds So eventually anyone who has who has that inventory available in the system will be definitely much lower than the today's 33:33 33 minutes, 33 seconds which include your loders. 33:39 33 minutes, 39 seconds Understood and sir any uh I very speculative question but any viewpoint on how US uh New York future bottoms 33:47 33 minutes, 47 seconds would do considering the drop situation in the US? uh will it will it sustain 82 83 historically I mean how so as I 33:57 33 minutes, 57 seconds mentioned the drought is not the only reason I I mentioned earlier also drought is one of the reason also also 34:06 34 minutes, 6 seconds the crop in India and Australia was also lower so the demand supply got readjusted for the first time after 3 34:15 34 minutes, 15 seconds years there will be a reduction in the closing stock of cotton so all these factors and then the synthetic other 34:22 34 minutes, 22 seconds prices increasing during a uh the possibility of some some consumption change or replacement from polister to 34:29 34 minutes, 29 seconds the cotton all those factors have played it into this role so it's not only the broad condition of BS but the many factors could have played a role where 34:37 34 minutes, 37 seconds suddenly people are more optimized or optimism more optimism is there on the near future 34:45 34 minutes, 45 seconds okay understood that's all my questions Dr. Thank you. Thank you. Thank you sir. 34:52 34 minutes, 52 seconds The next question is from Amnish Chandra from Snips. Please go ahead. 34:57 34 minutes, 57 seconds Congratulation management team on decent performance with G gross margin expansion. My first question is related 35:04 35 minutes, 4 seconds to this only if look at the number where gross margin was higher quarteron quarter 300 basis point but due to other 35:12 35 minutes, 12 seconds expenses margin expansion was not reflective at a VA level. So sir could you just give a a good highlight on what 35:21 35 minutes, 21 seconds led to a great increase in other extension and when it will get normalized if there is something one of. 35:28 35 minutes, 28 seconds Okay. So you know there has been one item which has been charged to the revenue in this period and the other expenses 35:36 35 minutes, 36 seconds whatever is the foreign exchange position we have taken that gets marked to market on every month end. So in this period the rupee had moved very sharply. 35:46 35 minutes, 46 seconds So whatever we have been selling because our policies were whenever we book the short orders most of the time we like to cover the rupee at the same day. Rupee 35:54 35 minutes, 54 seconds moved suddenly to 94 rupees 80 peso or so on 31st March. So whatever we have sold that was required to be making to 36:01 36 minutes, 1 second be normalized on the mark to market basis and we provided a loss of about 57 58 cr rupes in this quarter on that but 36:11 36 minutes, 11 seconds that advantage will come to us in the next quarter. Now all our exports will be moving at 94 rupees AC per or or whatever the market rate going backward. 36:20 36 minutes, 20 seconds So that one time hit it is definitely impacted our margin in the fourth quarter. 36:25 36 minutes, 25 seconds Okay. So it was roughly the number was the hit was exact number 5758 cr is provided as market. 36:34 36 minutes, 34 seconds Okay. So that will not be there going forward or there will be some reversal of that uh depending upon what uh the dollar 36:42 36 minutes, 42 seconds finishes I can't say tomorrow it goes to 97 we might have to provide it goes to 90 then that advantage comes in so I can't speculate on that but yes whatever 36:51 36 minutes, 51 seconds 31st March we have provided for that okay sir the second question you have already highlighted that at March end 36:58 36 minutes, 58 seconds everybody inventory is 6 to 8 month as a strategy what would be the number at the September and general number. 37:06 37 minutes, 6 seconds No, I'm one I'm not saying everyone had an inventory of 6 to 8 months. I said most of the good textile mill since it's a seasonal product they try to cover 37:16 37 minutes, 16 seconds their cotton uh normally 6 to 8 months time but the company to company it could be very very different too our cotton 37:23 37 minutes, 23 seconds new cotton will start somewhere in October only. So by September we have to exhaust most of our stock and we have to start preparing for the buying uh once 37:32 37 minutes, 32 seconds the once the new arrival comes in because we can't as the new arrivals will come somewhere in the month of October and if we have a 6 to8 month any 37:40 37 minutes, 40 seconds factory has inventory of 6 to 8 months they'll be they'll be finishing in this period and then eventually they'll have to buy new cotton starting September October November. 37:50 37 minutes, 50 seconds Okay, fair enough. And sir, one quick question on the KPEX side. You talked about uh increasing your government capacity which is still a very small 37:58 37 minutes, 58 seconds part of our overall business. So are we thinking seriously to have major expansion in government segment and go 38:08 38 minutes, 8 seconds broaden our product profile the way you have mentioned in your previous. 38:13 38 minutes, 13 seconds So earlier we were not very sure we really want to expand the government capacity or not but definitely the businesses whatever small capacity we 38:20 38 minutes, 20 seconds have done doing we have we are doing good. So but our costs are very high because 38:27 38 minutes, 27 seconds so the first step is let's make it a little viable unit and in case we can make money on the expanded capacity also 38:35 38 minutes, 35 seconds then we look at it differently as of now the only idea is it's a good business where we are dealing with the some of the brands we are supplying the material 38:42 38 minutes, 42 seconds to them or we are giving them the final product so just to sub to that we decided to expand this capacity so that 38:49 38 minutes, 49 seconds we are more viable whether we do in a full-fledged they choose in the future or not there's no decision as of now on that. So the first step is we are 38:58 38 minutes, 58 seconds looking at whether we can make the business viable. If a fresh view has to be taken by the management as of now there's no decisions that we'll be looking at it in a very very big way. 39:07 39 minutes, 7 seconds Not neither yes nor so we'll look at it or we'll evaluate it later. 39:12 39 minutes, 12 seconds Sure. And sir what is our average realization per shirt ballpark? $5. 39:21 39 minutes, 21 seconds Okay sir. Okay sir. Thank you very much for answering my question. All the best. Okay. 39:26 39 minutes, 26 seconds Sorry, sorry, sorry, sorry. It's $7 and a half. $7 and half dollar. Yeah. 39:33 39 minutes, 33 seconds Okay, sir. Thank you. All the best. 39:37 39 minutes, 37 seconds Thank you, sir. The next question is from Yes. Junjun Junjan as retail investor. Please go ahead. 39:46 39 minutes, 46 seconds Uh, thank you for the opportunity. Uh uh sir can you tell tell me what was the average spread earned by us in FI26? 39:59 39 minutes, 59 seconds I can't say what was bark spread but the industry spread for the year average will not be more than 65 cents 40:07 40 minutes, 7 seconds 65 cents and the current market conditions you were saying that the spread has increased to about 1995 correct 40:15 40 minutes, 15 seconds okay and uh my second question is that uh when the in the last two years when uh cotton globally was cheaper than 40:24 40 minutes, 24 seconds cotton in India because of which and our cotton yarn realization is linked to cotton globally. 40:32 40 minutes, 32 seconds Uh I'm sure the industry must have made representations to the ministries regarding this uh disadvantage that 40:39 40 minutes, 39 seconds Indian spinners had. So what what like anything structural that has happened that to address this uh gap that this disadvantage that Indian spooners had? 40:52 40 minutes, 52 seconds So India are most of the industry we have been going to the government and we have only one request made to them that 40:59 40 minutes, 59 seconds you allow the duty-free import of cotton in India that will have a balancing effect automatically because if CCA buys 41:07 41 minutes, 7 seconds all the cotton or majority the cotton then whatever there so there are two ways of looking at it one the CCA sells 41:14 41 minutes, 14 seconds it at a normal basis so that there's no disadvantage to the Indian spinner that could be one two to have a price this right It's completely allowed to duty 41:23 41 minutes, 23 seconds precaution to happen in India. So that automatically will happen in the times to come. So the industry issue is only and only we are not talking of MSB. We 41:31 41 minutes, 31 seconds are not talking of increasing or we not talking of not supporting the farmers. 41:34 41 minutes, 34 seconds The industry viewpoint is simple that the cotton should be allowed in India duty so that the price discovery happens 41:42 41 minutes, 42 seconds automatically and tax minister is totally aligned to that. They have already written couple of times to the agriculture and to the to the finance. uh no decision has 41:51 41 minutes, 51 seconds happened but I'm sure at least the our ministry is aligned to our thoughts. 41:58 41 minutes, 58 seconds Okay. And my finally question is on the uh all the FDAs that have been signed with the US with UK with EU. uh let's 42:07 42 minutes, 7 seconds say that uh the demand uh from for this for all the all the textile industry from India it improves but because of 42:15 42 minutes, 15 seconds this cost disadvantage will we be able to compete in case uh cotton again like there is duty-free access duty-free 42:23 42 minutes, 23 seconds import is not allowed of cotton and then again you'll fall back into that same problem of high cotton prices you know there are two things we are 42:31 42 minutes, 31 seconds talking to the government one as the demand would increase on account of the FDA is definitely we will be requiring 42:38 42 minutes, 38 seconds more raw material be it synthetic based cotton. So whatever cotton we have it may not be sufficient for us to supply 42:46 42 minutes, 46 seconds it in case the government exports or the home textile exports increase a big way from India. So both the logic we have been giving one is on the cost prices 42:54 42 minutes, 54 seconds that are the we should be competitive second on the availability of raw material because any any industry if they put in the capex the raw material 43:02 43 minutes, 2 seconds should be available at the international competitive price. 43:06 43 minutes, 6 seconds So these are the both the issues can taken care of if they allow the duty cordon to India. So let's see what happens. 43:16 43 minutes, 16 seconds Got it. All right. But government but one one good thing in between what has happened is that the GCI pricing policy 43:25 43 minutes, 25 seconds this year has been good and they've been selling the cotton based upon whatever has been the long-term uh alignment of Indian cotton with the New York future. 43:36 43 minutes, 36 seconds So to that extent there was no disadvantage for most period uh last 6 months to 9 months. That's why the industry is in a better condition. I should give that credit to CPA for that. 43:50 43 minutes, 50 seconds Okay. Understood. Understood. Thank you. That those are my questions. 43:57 43 minutes, 57 seconds Thank you sir. 44:01 44 minutes, 1 second The next question is from the line of Rishim Jan from PVD asset managers. Please go ahead. 44:08 44 minutes, 8 seconds Hi. Hi Nidra G. Uh good afternoon and uh thanks for giving us a very detailed update. 44:15 44 minutes, 15 seconds So I have uh one question uh mainly with respect to the uh uh announcement which 44:22 44 minutes, 22 seconds government has made yesterday mission for cotton productivity. 44:27 44 minutes, 27 seconds Um but uh what I could see in that is that it is it is not talking about the introduction of uh the new variety of 44:36 44 minutes, 36 seconds seeds but it is largely talking about all the farm improvement practices and um uh stuff like that high density 44:45 44 minutes, 45 seconds planting and all. Do you think that if India has to move from 450 kg per acre 44:52 44 minutes, 52 seconds to let's say even to US level of 700 to 800 levels will this be suffice or what 44:59 44 minutes, 59 seconds is your thoughts around this person 45:08 45 minutes, 8 seconds whatever we are thinking so one is the look at the overall lesser c in India one is the equality 45:17 45 minutes, 17 seconds Second is the practices and third is the land holding because the land holdings are also very small in India and any 45:24 45 minutes, 24 seconds kind of automization may not be possible there also you look at the total crop in India it's 30 million gra and almost 6 45:32 45 minutes, 32 seconds million farms farmers are producing there so that means average per farmer are there only five whereas you go to 45:40 45 minutes, 40 seconds the US or to Brazil or to Australia the number is in in thousands of days 45:48 45 minutes, 48 seconds not less than that or maybe in lacks of days. So eventually even if so we are looking at speed we are looking at 45:55 45 minutes, 55 seconds productivity we are looking at processes but the holding is also playing an important role in terms of the overall optimization. 46:04 46 minutes, 4 seconds So going to a US level of 700 or the Brazilian level of 2,000 I don't know but definitely we can improve upon it 46:11 46 minutes, 11 seconds from where we are but again going to I mean today Brazil is at 2,000 46:19 46 minutes, 19 seconds and uh they're still optimizing they're still looking at more experimentation they're still looking at what more can be done and the our cost will definitely 46:28 46 minutes, 28 seconds be expensive going by our land holdings also having said that we have to start somewhere It's a good initiative which 46:35 46 minutes, 35 seconds the government has taken and I'm sure if we take we can take this 450 to even 550 we can increase our productivity by 20% 46:43 46 minutes, 43 seconds which will give a lead to the overall cost as the MSP is dependent is dependent upon the cost to the farmer 46:50 46 minutes, 50 seconds plus 50%. So if the cost come down definitely it will have an impact in there better realization and a better cost for the industry as well. 47:04 47 minutes, 4 seconds So the second question is given that uh now the expectation for next year overall for the industry is looking quite uh positive. 47:14 47 minutes, 14 seconds Um and we have already done modernization uh capex largely in the last two three years which will bode well for us but beyond this are you 47:23 47 minutes, 23 seconds looking for uh because you need to plan from now to utilize that incremental cash generation. Uh so from a capex perspective are you plugging anything? 47:38 47 minutes, 38 seconds So two things I think uh you're right and not only us most of the industry is waiting because because the situation is 47:47 47 minutes, 47 seconds a little better after a long time. So everyone is trying to look at whether it is sustainable or not. But in between 47:54 47 minutes, 54 seconds one we we have taken a one open end project uh which was hold on. So we we are likely to restart that also we have 48:03 48 minutes, 3 seconds taken a new piece of land in PMRA park in Madhya Pradesh. That land is likely to be given to us as per the government 48:10 48 minutes, 10 seconds office as of now by December or January this year. So once the land is available to us we start working we are we are already on the drawing boards we are 48:18 48 minutes, 18 seconds putting up some ideas and maybe next two three months we'll finalize those ideas also and by that time we look at a sustainability of the system also and 48:27 48 minutes, 27 seconds not only the many we are looking at because this FTA demand will start happening somewhere 15 months down the 48:33 48 minutes, 33 seconds line and India we have to prepare within next two to four months we'll have to start looking at what all uh is required 48:41 48 minutes, 41 seconds in in country and all the good players have to prepare themselves so that those capacities could be put. We also gearing up ourselves and I'm sure next 2 three 48:51 48 minutes, 51 seconds months we'll finalize our plans as well on the spinning side on the fabric side in any case has a surplus capacity. So 48:59 48 minutes, 59 seconds we like to utilize it next month and by the time we utilize it we'll definitely there are some ideas in our mind what to 49:05 49 minutes, 5 seconds do next uh uh in the next financial year or so. 49:11 49 minutes, 11 seconds Okay. Okay. But in the existing set of verticals only like yarn, fabric you ventured into a little bit of synthetic as of now. 49:20 49 minutes, 20 seconds Yeah. As of now we we are restricting oursel to this only as of now. 49:26 49 minutes, 26 seconds Okay sir. Thank you. All the best. 49:30 49 minutes, 30 seconds Thank you. The next question is from Rudra Gupta from NIT Investment Trust. Please go ahead. 49:37 49 minutes, 37 seconds Hi, very good afternoon and thanks again for the detailed uh explanation. Uh so I have two questions. One related to what 49:46 49 minutes, 46 seconds you explained that India should have had a spinning capacity of 58 59 million uh versus operational today at 4142. 49:56 49 minutes, 56 seconds uh given the environment where uh spreads are expanding uh the cotton prices have actually aligned uh of India 50:04 50 minutes, 4 seconds and international which actually solves a big problem uh a potential uh FDA with Europe and UK which is an incremental 50:11 50 minutes, 11 seconds positive uh to play out like you're suggesting over 12 to 18 months uh and an incremental uh development uh in 50:19 50 minutes, 19 seconds terms of you know if the import prices or the import duties are actually dealt with correctly by the government uh this is the most promising uh commentary if I 50:28 50 minutes, 28 seconds may say so uh that I've heard in a long time along with a very wide gap of uh required capacity uh versus available 50:37 50 minutes, 37 seconds capacity at play. uh would this really mean that a very large uh expansion uh of capacities can come through over the 50:46 50 minutes, 46 seconds next uh 3 four years if uh the cycle sustains the import duties are taken out and the FDA's actually start to bring in 50:53 50 minutes, 53 seconds benefits and I will bring in my second question after uh once I hear on okay so I I'd like to make one correction your all the data and facts 51:03 51 minutes, 3 seconds you have given is correct except one when I said the capacity should have been 60 million it should have been going by the tradition or the 51:11 51 minutes, 11 seconds conventional increase which happens every year. Whether we require 60 or not is a separate question. So we were at 53 51:18 51 minutes, 18 seconds normally we were adding 2 and a half million spenders every year. So we should have reached 5960 again we are at 412 51:26 51 minutes, 26 seconds the Indian spinning capacity lots of spinning capacity was very very uniable inefficient which is going out of the system. So if you look at the total 51:35 51 minutes, 35 seconds demand in India today 41 42 million spenders are sufficient as of now for the country and that's why our margins 51:42 51 minutes, 42 seconds have become better. Now going forward as the expansion will happen by way of more FPS and the demand coming in we 51:50 51 minutes, 50 seconds definitely require more spending capacity whether it is 60 million or 45 or 50 that's depend that will depend upon how much new business we can 51:59 51 minutes, 59 seconds generate with these FTAs but definitely there is a scope for this India for the country if with all these FTAs coming in 52:07 52 minutes, 7 seconds the demand on the governmenting and home test increases definitely on the spinning side we will be requiring a much bigger capacity as a country 52:16 52 minutes, 16 seconds and the good part is all the smaller all these smaller players have gone out of the system. So now the new expansion hopefully will come more in the 52:24 52 minutes, 24 seconds organized hand which means there will be a better competition compared to the very very uh unorganized competition. 52:33 52 minutes, 33 seconds Sustain sustains profitability for the industry and helps KEX building as well. 52:38 52 minutes, 38 seconds Correct. Uh so the second question is more related uh to this uh situation where uh geopolitics is what you 52:46 52 minutes, 46 seconds referred to where you know some countries who are also manufacturers and exporters have been having issues and uh those issues in my understanding have 52:54 52 minutes, 54 seconds worsened uh in the current West Asia war if I may say so. Uh is that correct as an understanding and is there a further 53:02 53 minutes, 2 seconds weakening of other Asian competitors which will give a sustained advantage to India? uh is that a fair assumption or 53:09 53 minutes, 9 seconds an understanding or or that is something where we can see a comeback from them very quickly you know if you look at the spinning 53:16 53 minutes, 16 seconds sector the four countries are or the five countries are taking 90% share in the spinning China 53:24 53 minutes, 24 seconds India Pakistan Bangladesh for captive and Vietnam these are the five countries which are taking care of almost 80 85% 53:31 53 minutes, 31 seconds of the world's filling capacity let's look at it one by one China they They started reducing their spinning capacity 53:39 53 minutes, 39 seconds almost 15 years back from a peak of 112 million spindles. They are today down to 84 million spindles only. Though they 53:47 53 minutes, 47 seconds have announced some capex in the Zingzang area where they have lots of cotton. At the same time the government of China this year has officially 53:54 53 minutes, 54 seconds announced that we want to reduce the cotton in the Zingzang area and we want to move more on the food articles as the country will be requiring more more food 54:02 54 minutes, 2 seconds grains for their uh consumption. So which means the cotton will come come there also and if you look at last 10 15 54:10 54 minutes, 10 seconds years as I mentioned their peak capacity from 112 million spenders have come down to 84. So this means they will not be 54:16 54 minutes, 16 seconds expanding which means we can the could be that they will not be expanding in a big way. Second country is the Pakistan. 54:25 54 minutes, 25 seconds Now Pakistan again if you look at their own issues and concerns be it uh be it political be it power availability be it 54:33 54 minutes, 33 seconds or any other factor I think there is a limitation so they will also not be expanding their business in a big way to 54:40 54 minutes, 40 seconds cater to the international demand third is the Vietnam now Vietnam already it's a very small country small population 54:48 54 minutes, 48 seconds and they have done fantastic job in the textile starting from spinning to the garment team as the per capita income started moving up there is more interest of the people 54:57 54 minutes, 57 seconds to go and for the electronics and the service industry there also so with a small population we don't see that Vietnam will be increasing further on 55:05 55 minutes, 5 seconds this on the on the spinning side rather whatever is there they can at best utilize that not not likely that they'll be expanding the spinning business to 55:14 55 minutes, 14 seconds that extent fourth is the Bangladesh Bangladesh uh is very strong on the governmenting after China they are number two players 55:22 55 minutes, 22 seconds almost 55 54 55 $5 billion of work of sports they doing on the committing side. The spilling capacity today is 55:30 55 minutes, 30 seconds about 14 to 15 million tenders and the utilization is not more than 55 60% even as of now they since they are very 55:38 55 minutes, 38 seconds strong at the governmenting some groups have gone back to back where they put in a spinning capacity but spinning is a very very large step that's required to 55:47 55 minutes, 47 seconds and they don't have cotton they'll have to import everything so eventually it looks like the major spinning expansion may not happen in Bangladesh also and uh 55:55 55 minutes, 55 seconds but on the government side they may continue to grow as a result of that they'll be requiring good quality yarn as well as the fat some they may require 56:05 56 minutes, 5 seconds so to that extent they'll have to depend upon someone else and uh the last uh out of these five is the India which is 56:14 56 minutes, 14 seconds today the best place because we are number two spinning capacity in the world even with the 41 42 million spenders we are the second largest in 56:21 56 minutes, 21 seconds the world today in terms of technology in terms of cotton availability and in terms of the overall all the overall 56:29 56 minutes, 29 seconds clusters in the geopolitical I think they're definitely better places. I can only hope that India should be in a position to take full advantage of this 56:38 56 minutes, 38 seconds situation. The only caveat I have in mind is that the raw material availability at a international 56:45 56 minutes, 45 seconds competitive price which we have been talking to the government and we are hopeful that the government looking at the overall uh potential will definitely 56:54 56 minutes, 54 seconds understand and look at something like this. 56:58 56 minutes, 58 seconds Thank you sir. That's that's very very helpful once again. 57:03 57 minutes, 3 seconds Thank you. The next question is from Sudir Kia from Value Wise. Please go ahead. 57:10 57 minutes, 10 seconds Yes sir. Uh good evening sir and thanks for the opportunity. Sir you have outlined lots of reasons uh uh for the 57:18 57 minutes, 18 seconds tailwinds for the industry. Uh my question from uh the next season practice. Do you 57:26 57 minutes, 26 seconds think that uh next season quarter also get impacted because of the weather condition 57:37 57 minutes, 37 seconds as the cotton? 57:41 57 minutes, 41 seconds Yeah, there are two pack one is the physical cotton second is the future cotton. So whatever is the 57:48 57 minutes, 48 seconds weather conditions announced today it's already captured in the future prices and going by the situation if things go worn 57:58 57 minutes, 58 seconds it can increase if things become better or the more rain happen it can soften also but cotton is one product where 58:04 58 minutes, 4 seconds based upon the future uh uh check events which are likely to happen it's already capturing into the market very very well. 58:14 58 minutes, 14 seconds So, so from cotton prices perspective, you think that the uh uh is already captured in the cotton 58:22 58 minutes, 22 seconds prices uh from international perspective, right? As of now, yes. But definitely there are so one is the more 58:30 58 minutes, 30 seconds views coming in based upon that what whatever condition can happen. Second, there's the possibility for the hedge fund of the speculative fund which is beyond control of any one of us. Right. 58:41 58 minutes, 41 seconds The second question is that uh while the cents uh the spreads have increased almost by 40 50% from their lows what 58:50 58 minutes, 50 seconds has been the spreads uh at the peak in the past and do you think that the spread can rise further from the current 58:56 58 minutes, 56 seconds levels as you move ahead uh to the next season? Most of the times if you look at 59:03 59 minutes, 3 seconds last 20 years except the the uh the years which could be very good or very good that the $1 spread is always 59:11 59 minutes, 11 seconds considered to be good for the spinning industry. 59:16 59 minutes, 16 seconds Okay. Okay. So with repeat appreciation that will add extra to the earnings of the spinners for the industry. 59:25 59 minutes, 25 seconds It should normally because our cotton uh is about 50 55% of the uh total uh 59:32 59 minutes, 32 seconds finished product. So whatever with the rupee changes happening the cotton will align to in US cent very cotton get 59:40 59 minutes, 40 seconds aligned to US cent very fast because anyone who's buying here will always look at the future and the landed cost in India based upon the US hand but 59:49 59 minutes, 49 seconds whatever is the value addition that advantage comes in with the uh with the weaker rupee 59:56 59 minutes, 56 seconds and sir my next question is do you up to what time do you expect this spreads to sustain 1:00:04 1 hour, 4 seconds uh do you think this to sustain from one two quarter perspective or uh or maybe four five quarter perspective how should we look at that 1:00:13 1 hour, 13 seconds today things are good it's really really difficult for me to say whether these people will remain at these prices or what will happen to the China or the 1:00:21 1 hour, 21 seconds world so it's very difficult but I can say as of now things are looking nice and there doesn't seems to be any big concern rest it's very difficult for me 1:00:30 1 hour, 30 seconds to predict whether it can be for five quarters or one quarter or two quarters but as of now and I can tell you most of the spinners from India in export market are sold for 3 months as of now. 1:00:42 1 hour, 42 seconds No my reason the reason of my question was because some of these uh uh reasons which you highlighted like on the 1:00:50 1 hour, 50 seconds spinning capacity these are structural reasons and they do they are not seasonal. So from that perspective uh 1:00:58 1 hour, 58 seconds from that perspective definitely seems to be a better place. Yeah, from that perspective it's a better place. But then the cotton prices or the demand 1:01:06 1 hour, 1 minute, 6 seconds structures or anything happening on the bar side, there are so many factors today that anything can pay anything. 1:01:12 1 hour, 1 minute, 12 seconds But yes, in Indian context with the with the closing down of part of the capacity, it can be better based and 1:01:19 1 hour, 1 minute, 19 seconds also we have a better situation going forward because of the FDS and next 12 15 months definitely things are likely to be better only for India, Indian 1:01:27 1 hour, 1 minute, 27 seconds governmental and the home testing. So to that extent we are optimized or we have optimism to that extent as well. 1:01:36 1 hour, 1 minute, 36 seconds Thank you sir. 1:01:37 1 hour, 1 minute, 37 seconds D time constant we will take this as a last question. I now hand the conference over to management for the closing comments. 1:01:47 1 hour, 1 minute, 47 seconds So I think uh we've tried to give based upon our judgment and our thought process we have tried to give whatever 1:01:53 1 hour, 1 minute, 53 seconds best knowledge we have uh rest the the events occurring the across across worlds are so far so many that 1:02:01 1 hour, 2 minutes, 1 second impossible for anyone to understand and know the impact of that on the overall industries but definitely as I mentioned 1:02:09 1 hour, 2 minutes, 9 seconds uh after after two three years there seems to be some spike in the industry again for the reason as I mentioned that our raw material became more competitive 1:02:18 1 hour, 2 minutes, 18 seconds and with the better and with the better demand and lesser capacity we are definitely better balanced as of now. I 1:02:26 1 hour, 2 minutes, 26 seconds hope uh the next year should be better year for most of the textile companies including Wagman. And in the meantime uh 1:02:34 1 hour, 2 minutes, 34 seconds most of the industry is very very op has a optimism based upon all the FPS which the government has done which is which could be a a major growth engine for our 1:02:43 1 hour, 2 minutes, 43 seconds governmentals and the home textiles and we being the textile producer or textile material supplier to them. If they do well definitely our company can also do 1:02:51 1 hour, 2 minutes, 51 seconds well. So thank you very much for your confidence and your support always. 1:02:57 1 hour, 2 minutes, 57 seconds Let's hope things will be better in the next times to come. 1:03:02 1 hour, 3 minutes, 2 seconds Thank you sir. On behalf of 361 Capital that concludes this conference. Thank you for joining us and you may now disconnect your lines. Thank you.