Astral Ltd
NSE:ASTRAL
Earnings Call Analysis
Q2-2024 Analysis
Astral Ltd
The company has sustained a robust EBITDA margin of 18%, staying well within their guidance range of 16-18%. While experiencing growth across its various business lines, the company has enhanced its market share, aiming to continue this positive momentum.
In India, the adhesive business flourished with an 18% increase in value, and the U.K. counterpart also showed significant progress with a 17% rise. Despite facing a negative trajectory earlier, the paint business is now on the path of recovery with improved performance.
The company has witnessed a consecutively strong volume growth in its core piping business and predicts sustained demand. This is attributed to new project announcements, lower polymer prices, and increased infrastructure spending. To meet the expected demand, the company has expanded capacity by an additional 22,000 metric tons in Guwahati and overall by 20,000 metric tons in existing plants.
Despite incurring a loss of approximately INR 20 crores on inventory owing to price reductions in the market, the company has delivered a promising top line volume and protected their EBITDA margins. They have revised their volume growth guidance upwards from 15% to over 20% for the full year.
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Ladies and gentlemen, good day, and welcome to Astral Limited Q2 FY 2024 Earnings Conference Call hosted by ICICI Securities. [Operator Instructions]. Please note that this conference is being recorded. I now hand the conference over to Mr. Arun Baid from ICICI Securities. Thank you, and over to you, sir.
The Q2 FY '24 result call. From the management side, we have Mr. Sandeep Pravinbhai Engineer, Chairman and Management Director; Mr. Ken Engineer, ED; and Mr. Hiranand Savlani, ED and CFO. Now I hand over the call to Mr. Sandeep Pravinbhai for his opening remarks, post which we'll open the floor open for Q&A. Over to you, sir.
Thank you. Thanks, everyone, for joining the earnings call of Q2 FY '24 and the first half of FY '24. First of all, I am happy today to share this year Astral is celebrating its 20th anniversary. This was full of legacy of innovation, connectivity, brand building, wide distribution network creation, creation of reach in every corner of India and strong -- building a strong production capabilities across the country. We started the journey of CPVC pipe manufacturing. And today, we can proudly say that we are a building material company, having 4 different verticals and thousands of SKUs in different verticals. Astral started its journey in 1998 in the same month of October with single product and single focus to bring CPVC to India. And today, we can say with pride that we are the first one to bring CPVC to India. The first one to make CPVC a product which can replace and which replaced the metal piping, and we have created a history of CPVC for 25-year of our presence in this country and growing and now multiple manufacturers are joining to make CPVC products. As you are well aware, the market situation continues to be volatile. The polymer pricing and the chemical price situation, which is continuously having -- going up and down, but slowly, the PVC prices are now settling down, and CPVC prices of this quarter were also come to a level where it has settled out. But this all chemical fluctuations are the challenges of margins and various growth aspects of the market. But I'm very happy that with all these challenges and volatility, we at Astral are always trying to mitigate these challenges and deliver a consistent performance on a yearly basis. The result of this is in front of you. Once again, we are able to be able to deliver a teamwork and we have worked on once again with this volatility also and to give you a volume growth of 25% plus and in the second quarter in a row. In this scenario is very robust. And seasonally, in the first 2 quarters, which is loaded with PVC product demand with agriculture and certain [indiscernible] sites. In spite of that, our CPVC growth was excellent. During onward trend of polymer, we also know the distributors always lease stock their product and the material. Despite of that, we are able to grow and maintain our margins of 18% plus EBITDA after adjustment of sanitary and forcets losses and CPVC inventory loss. Coming to the pipe business. Due to the robust demand in pipe verticals, company has decided to aggressively move into expansion of its capacity. As communicated earlier, we are putting up 3 new plants and all are going to be as per schedule. Guwahati 22,000 electric ton plant already started production of water tank and shortly, we'll start production of pipes. Astral's 70,000 metric tons and 50,000-metric expansion activities are going up going on in full swing at this plant. As communicated earlier, we have increased our capacity within our existing plants to a tune of 20,000 metric tons, which is up and running. At present, our capacity has increased from 2.9 less metric tons to 3.9 metric tons. Here are a company which can proudly say that we are the first company and at present the only company who get NSF certification, the highest certification come from United States now which also is considered very prestigious and important in India for our water tank[indiscernible] in the market at present are NSF India. So our whole water tank are safe to handle drinking water, when water is stored there and consumed by human beings. With NSF certification our dam and activity centers, which is safe for consumption of water by open drink and without telling victim or without any obligation from the water. We are also a first one to get the ISI Certification [indiscernible] question-and-answer sessions. And our fire parking system is getting approvals and acceptance very fast in the market and the business is building up in high value and volumes. For our additive spot business, our state-of-art planted by this, which have got all the permissions, also the gas connections who run the plant is up and running. And the production capacity at [indiscernibe] is huge, and it will be fully operational in the next 2 quarters. And as we plan, we'll make our major products of box cities and white blue and other adhesive products at the rate, and we will reduce one production facility in Tanu in next 2 to 3 quarters. And all these production capacities will be moved to -- mostly to [indiscernible]. And so one location will be in some kind of. Our volumes are continuously growing in high double digits. And now the chemical prices have settled down and are stable. So we are getting good support of margin and consistency of the business in [indiscernible]. Both our U.K. and India businesses are forcing a good growth in coming years, and we are very positive on the business outlook for the [indiscernible]. Paint business. In paint business, we -- as we communicated in the last call, we are passing through some changes, some keeping problems. SAP is completely implemented now. A lot of KYCs are done for the counters or the retailers who we sell. Our systems are in place and the systems are settling down, and we are seeing improvement in sales compared to the last quarter. And now we will see further improvement with growth in the coming time. And our team has started taking charge of that business, and you will see a lot of improvement in coming 2 quarters for the paint business. And in next coming 2 quarters, the pain business will show a positive growth number and a growth number also. And there will be strategies to launch the paint under the Astral program shortly and which will be communicated in the coming 2 quarters, within 2 quarters, and we will be opening many new geographies of India, with launching northern plant paint products. Sanitary and faucets, I'm very happy to announce that our team has achieved a first milestone of getting 500 stores where in our display is placed. And all these stores have started selling the product to the end consumer, we have completely tracking the tertiary sales. So for me, selling to actually user and to the client, the tertiary sale is very important, and we are getting good response from our product line. The product line is growing. We have reached an average of INR 6 crores, by the last 2 months. Last month, we have been averaging around INR 8 crores plus annure sure that in next 2 months, we will be crossing our breakeven number of INR 10 crores plus, and we will continue our growth. Lots of new product SKUs are getting accepted in the market. You can clearly see that forthcoming times, we'll be really good for our brand Astral in the vertical. As we have worked very hard to build the brand Astral and the brand Astral itself is a big thing to pull a lot of our product lines and to make them reach to the consumer with price and with the plan, except brand power. To summarize, all verticals are doing good. We are going as per our plans, and we don't see any much challenge in the market, and we'll keep giving our consistent growth for our company as it is known for and as we have always communicated. Now I hand over to Mr. Hiranand Salvani, our ED and CFO, for his opening remarks on the numbers and then myself, Arun Baid and Kairav will answer all your questions. And once again, thanks for joining the call and trusting Astral. Thank you very much.
Good afternoon, everyone. Thanks for joining this conference call. I will take you through the few key numbers of this quarter and then at we go to the Q&A so that we can spend more time on the Q&A side. The revenue numbers are in front of you. This quarter, we have grown 16.3% in a consolidated wage. EBITDA growth was very high compared to the last quarter or even compared to the last year also. And in percentage term, it was 17.1% compared to last year's similar quarter was 13.2%. Now if you break up this consolidated number, then I think pipe, that is a plumbing, which includes the sanitary where in plastic also, which is roughly about INR 17 crores, INR 18 crores a piece. The value growth was around 17.3%, and volume growth was close to about 28%. And the EBITDA growth was around 57% and the percentage from EBITDA was 18%. So we have guided that we will be working in the range of 16% to 18%. So I'm very happy to say that we are on a higher side of what we have guided. And not only that, if we do the adjustment of inventory losses of CPVC to the tune of INR 20 crores and roughly about INR 4 crores a piece loss of the pathway, then the adjusted EBITDA will be even much higher. Now coming to the further breakup of our this as vendor sealant business, Adhesive Business of India has grown by 18% in value terms, and EBITDA was roughly about 15.5%. Adhesive business in U.K. grown by 17% and EBITDA was roughly about 10%. Paint business, which was around negative 6% and EBITDA of 16%.These are the key numbers, and now I will take you through the few highlights of this quarter. This is the second consecutive quarter where we were able to deliver 25% plus volume growth of our core piping business in spite of having a very high base last year, if you can see the last year number also, you can see that our base was not low in the last year also. And that's why we have given in our press release, the last 4 years, CAGR growth also. The demand there is excellent, and we are expecting the coming quarter also demand should remain positive, mainly due to good announcement of new projects by a lot of developers, low polymer price, both CPVC as well as PVC. A lot of infra spending is increasing, and we are seeing a good growth in the housing side also. Across the board where we are seeing the citywide data, every -- most of the good cities are touching the new pipe. Most of the cities of India is having good construction activity and demand is coming from across all the 4 zones of countries. And our new locations are giving very good healthy volume growth, than originally we planned. So we are very, very excited with the performance of not only our new location that is the Easter, but we are very happy with our new product growth such as paint, wall, drain proofs, Silencio and now Bathware also. As you all are aware that the CPVC prices are on a lower side, and we have to also pass the price reduction to the market. And due to that, our realization has dropped compared to earlier quarters. We have to incur approximately INR 20 crores of loss on inventory and our volume is highest in the turnover.The effect on the inventory is high on our company. But in spite of that, we were able to deliver a very healthy top line volume and EBITDA margins. We have always communicated that Astral is always believing in consistency in performance. And you can see in this quarter also that in spite of inventory loss in security, our margins were healthy, and our volume growth was excellent. We have not compromised our margin in spite of 28% robust volume growth in this quarter and high loaded PVC volume also. Our gross profit margins were highest in the last 4 years. We were having EBITDA margin guidance of 16% to 18%, but we believe have over surpassed this number. And we are expecting that from the coming quarter, the polymer prices are more or less going to bottom out. We are not seeing much growth from here on. A little bit may happen because we -- it is very difficult to predict the number, but it looks that now the seasonal quarters are starting seasonal months are starting in India. And historically, also in a seasonal quarter, the demand is high, so the prices will not fall. So we are expecting maybe a little bit upward revision of the pricing in the coming side. And if that is going to happen, that then may be a conversion of inventory gain in the coming quarters. Of course, Q2 will be a little pressure because of the PVC, which had dropped in the first 15 months -- 15 days of the month of October. Looking to the first half of performance of 29% volume growth and lower price polymer we are increasing our guidance from 15% to more than 20% volume. That means minimum 20% plus volume growth for the full year. So we will try even more than 20% also. Since our Guwahatiplant has started paying products and shortly, we are going to start the pipe also, we are expecting some support from that location also in the second half of the current year. We are putting up 22,000 metric ton capacity in Guwahati. During the first half, as Sandeep communicated, we have increased our capacity within our existing plant to the tune of 20,000 metric tons. So our capacity has increased from 290,000 metric tonnes to 300,000 metric tons. Indian operation of our Adhesive business has delivered a very, very healthy, not only volume growth but value growth to the tune of 18%. U.K. has also delivered both volume growth and the value growth. Value growth is to the tune of 17%. EBITDA margins are also very healthy our in Indian operations closed about 15.5%. And U.K. was 9.7%, a little lower than what normally they deliver 11%, 12%. But we are expecting that this margin to improve further from U.K. in the coming quarter because now whatever the high cost inventory there almost on the word go completion.Paint business has shown a good recovery compared to the last quarter. You can see that last quarter was around INR 40 crores, INR 41 crores. This quarter is around INR 47 crores and a very healthy EBITDA of 16%. On Y-o-Y basis, we can see there was a drop of 6%, but we are confident that in the coming quarter, we will improve that because now we are settling down with our new systems and processes and SOPs and the SAP implementation. So that, I think, mostly our team is getting accredited and the new Genpath is also getting accredited with the new system. So we are expecting that it is going to give us a very, very good results in the coming years. We have successfully implemented SAP. We are confident that we will come into growth rate shortly and now more clear visibility of the data is there that is helping our team in the transparency within the 2 teams and as communicated and as per our agreement, we are going to complete the 80% stake in the game page in this month itself. That is in the month of October itself. So you will see that now our full flat team will be there in the [indiscernible] also. A lot of work is going on in the business as Sandeep communicated at the back office level, we will see the benefit in the coming quarter in terms of system improvement, in terms of branding, in terms of HR activity, in terms of sales and marketing into the paint business. Bathware has communicated. Last quarter, we are slowly improving the performance in the sales number. I'm happy to share that last quarter, we have done a sales billing of INR 18 crores or approximately a run rate of INR 6 crores a quarter. Last month was very heavy, close to about INR 8 crore. That is a September month. And we are expecting that it will improve further in the coming time. If I can correct a little bit what Sandeep communicated, we are shortly going to close the INR 10 crore plus run rate. So instead of 2 months, within 2 quarters, we are going to cross the INR 10 crores plus run rate, and we are going to achieve breakeven as early as possible. So hopefully, in the first quarter or second quarter, definitely, we will be into the breakeven side. Now to summarize all the 4 verticals, we are very happy with the performance, and we are confident that this growth momentum will continue, and we will keep working hard to gain the market share and last but not least, that our core vertical, that is pipe, you can see that in spite of higher base, we are still gaining the market share. And with branches getting more and more stronger will gain more and more market share in the coming times because we are adding a lot of new geographies in terms of manufacturing facility, which will help us to grow market share and reduce our credit cost. Now I'm opening up the floor for a Q&A session. Thank you all very much.
[Operator Instructions] The first question is from the line of Shubham Agarwal from Axis Capital.
I just wanted to reconfirm the inventory loss of INR 20 crores, right? And there's no inventory loss in PVC from this quarter. The whole inventory on PVC will come in October.
So in fact, PVC was some gain in the beginning, but because what happened that in the last month of September, everyone has to give the price protection to the market. Okay, because Reliance announced the price protection. So in the day of October, the price dropped by INR 4. So because of that, we have to pass on, give the credit down to every distributor. So whatever some gain we get that was wiped out because of this protection which we have given to the market. Otherwise, there was a slight gain in the beginning of 2 months. So now this gain -- loss is purely because of the CPVC.
Okay. Second, just on some on the growth, I had a question. So we've seen that the government CapEx has been -- has been really front ended in H1 of this year given the big elections are coming around. So I just wanted to take a sense of you. Do you expect any growth to slow down going into Q4 of FY '23 and Q1 of FY '25? Yes, that's the question.
So I don't think it is going to affect too much because of the election. The reason is very simple that our company's dependency on government projects is very, very thin, except REX product that is a double-wall corrugated that is related to the government projects. And that, too, we have converted sizable business of racks also into the private projects. Because our forte is more on the private side of the business than the government side of the business. So I don't think it is going to affect a big way to our company because our dependency on the government pay is very low.
Understood. And congrats for the good volume growth that you've been delivering.
The next question is from the line of Venkatesh from Shah Group.
I have 2 questions. First one is that since you have already done 29% volume growth by in Plumbing segment in the first half of financial year going forward. even [indiscernible]16% Y-o-Y growth in quarter 4 financial year '24. Will it you bring your volumes to almost 63 metric tons. So assuming 30 by 4, like 75,000 tonnes of production capacity per quarter will bring your utilization capacity to around 85% level, which is much higher than normal levels of 65% to 70%. Is it possible to achieve this kind of utilization of machines given shorter changeover time of fittings, et cetera? Or am I missing something? And resin, I have yes. Okay. Please go ahead.
Yes. So see, capacity right now, our utilization is around 67%, 68%. And we have recently added 20,000 metric tons within our internal plans and 22,000 Guwahati is almost on the verge of completion. Bank has already rolled out and prices are going to be rolled out shortly. And there is still some scope available in our existing capacity, whereby we can further add 10,000 to 15,000 metric tonne if required, okay? We have to end the machines only. So we will see -- evaluate the situation on the ground. And based on that, we will take. And next year anyway, in the second quarter, or this Telangana plant will be up and running. So I don't think we have any problem as far as the capacity is concerned. Secondly, we are always sitting on a reasonable inventory levels also. So even if particularly the last month of the year, marked some extra demand comes, then we can reduce a little bit to our inventory because anyway, Q1 is slow. So we can readjust that also. But I don't see any problem into capacity. We have enough capacity to take care of whatever the demand. Even 30% kind of volume will come and then also we will be able to manage. That's what we have done an internal working.
Okay. And then one question, like what is the maximum possible utilization that you are assuming? Is it like 85% possible or we will stay around 80% itself?
Yes, 85% is possible because more and more utilization will increase, the same machine will manufacture the same die pipe. So naturally, 85%, we can reach back.
Okay. And I have a second question on CapEx. You have guided a CapEx of like INR 30 crores for financial year going forward, right? So while your half yearly cash flow statement indicates almost INR 300 crores is already done. So second half of financial year '24 CapEx is that's like INR 50 crores. So is there any revision in the CapEx? Or are you going ahead with 50%?
So CapEx will increase to the tune of INR 75 crore additional because there is a land which we acquired for the corporate house, which is near to our existing premises, okay? So there, we have spent INR 70 crores. So that is the additional CapEx, which was not originally planned because we were getting the land very near to our existing corporate house, which is very, very difficult to get otherwise, we have to select the other locations. So we have recently acquired that land. So that's why that is the additional CapEx.
Okay. So on and on, it will be like 300 already done, 50 pending and 75 more?
I think 280 we have done and the balance will be in the second half.
The next question is from the line of Keshav Lahoti from HDFC Securities.
Just wanted to get a sense how is the channel reacted to the sharp rise on the side. So we expect some challenge to stocking.
Sorry, I could not hear your question.
Destocking right? So my question was there has a sharp cut in rating prices in October. So how is the channel reacting -- are they start to...
Right now, I think PVC has mostly bottomed out. So the price drop that came, it came very rapidly in a span of 11 days. There were 3 major drops. So around INR 11 price of PVC had dropped. But general is still mine, there is no destocking as such. People were expecting this sort of a price drop in September and hence, all the major player has given the price protection also. So the first price drop was already supported by the manufacturers. So the second two price drops basically came in a very fast duration. And at that time, the channel inventory was not at its peak. So I don't think there has been a major issue with regards to dealers losing out in -- because of these price drops. And now I think globally, PVC has bottomed out, and everyone is well aware that from here onwards, PVC will only see an upward journey going ahead. So globally also, internationally also, we are seeing that PVC has bottomed out and stabilized at this level.
I think I can add to what Savlani said that the September, you are right, there was some destocking from the distributor side because everyone was expecting there is a drop in the polymer price because international price was low, but India price was higher. So September, there was a destocking. But I think now quickly in 11, 12 days that drop as a conso again, we are expecting that the channel will refill in this couple of weeks or 3 weeks' time.
In your understatement what was the reason for the sharp percent rising prices?
Import level, the international offers were lower than the Reliance offer. So Reliance had -- and the local trader we're also putting at a lower rate than the reliance pricing. So eventually to match the international level and the local trader level, the Reliance had to do the price shortcuts.
Any idea about what would be the volume growth on the SE segment side?
It is very difficult to give a volume number because there, we are selling different chemistries, some are solid, some are liquid, some are in a gel form, some are in a powder form, construction chemicals are there, sealants are there, additives are there. So it is very difficult. Packaging is also very different for that product. So very, very difficult to quantify the volume number for that.
Last positive from my side. what has...
Sorry to interrupt. Keshav, can you please use your handset because there seems to be some sort of disturbance in the line.
One last question from my side. What has been the CPVC price correction in quarter 2?
I think we have dropped close to about 7% to 8% in the market.
Okay. Because in Q1 call, you said that the prices are almost have bottomed out for CPVC because we have anti-dumping duty in place. So 7%, 8% sounds like a big number.
Yes. But because the problem was that the international level price drop. So the countries which are not falling under the antidumping duty, they started cutting the price, so Japan, Thailand, local manufacturer. U.S., they started cutting the price. So naterally, we have to also pass on to the market. And in a way, it's a good move because ultimately, it is going to shoot up the volumes in the coming time. The price will be affordable, then it will grow the market also. So in a way, it's a good move.
Yes, perfect. So price is not coming at the expense of margin, right?
No, no, no, margins are still stable. In spite of so much to drop, you see we have maintained 18% kind of band.
Yes, yes. Perfect. Yes.
So we are also slowly and gradually giving the price reduction to the market. If and when we are getting the support, we are giving it to them.
The next question is from the line of Praveen Sahay from Prabhudas Lilladher.
And many congratulations on a very good set of numbers. So the first is just a follow-up on the last participant question related to the CPVC pricing. So what is the reason? I can understand that the U.S. and Japan as the local players has reduced the price and ultimately the 7%, 8% reduction in the quarter. What is the basic reason. It is a demand-supply mismatch, which has led to the...
That's a -- raw material for CPVC is PVC. Now PVC, if it is bottoming out internationally at a $750 level, then one cannot expect CPVC to over at $2, $2.1 level, no, that delta should not be there. So when these raw material prices are falling, obviously, the derivative price is going to fall.
Okay. So what's your expectation for the way forward for CPV recent? Is it also a bottom out? Or is there a further room for a reduction in the prices as well?
I think it has almost bottomed out. Now we are not expecting further drop because PVC is almost -- after so many years, low is there, so we don't see that PVC will further go. I think we are at a pre-COVID level. So I don't see further drop in the CPVC or PVC.
And number can you give like what is the pricing of of PVC resin right now?
So it varies from company to company because multiple companies are there. Every company's price is different.
Okay. Got it. The next question is related to the Adhesive business and especially the domestic business and where you had -- now that the hedge unit up and running. So how is the utilization label at the company level for the adhesive capacity?
At present, the utilization is good, but not -- we can even increase it to a good level. But with the hedges coming in, we'll have a good capacity and the utilization will obviously go down. But in chemical plants, you cannot keep adding like plant, one excluded every time. When you are building a plant, you must keep a vision of at least 10 years and built your plants because chemical plants are tough to keep erecting and adding. So in Dahej, we have gone with an automization plant, a plant with good filling capacity, good production capacity. And also, we can make multiple chemistries out of it. And also, we are getting a good response of our oxesin exports also. We are seeing a good growth coming in the coming years from that market and also the Indian market. So the hit will add capacity to a substantial level, but it will also optimize the production cost, which is a plant which will be automized and running. Certainly, we are in certain chemistries going 1 to 2 steps backward, which will give an additional advantage of our raw material cost paid. So adding capacity or building capacity in the pipe business or the polymer business is something which is different. And in chemical business or in the adhessive business, it is something which is also different. But we are optimistic or we are sure that this capacity will help us to go long-income 4 to 5 years and even a little bit more than that.
Sorry, can you quantify as a percentage how much the capacity has increased with the time?
We cannot because in the -- in there there's a lot of things which are different. We have then to tell you this is the capacity in liters is the capacity in kgs. This is the capacity in because we have different products which are made and labeled in different metrics. There are liter there are kgs, there are gels, there are formation. So it's -- it is not like a pipe you convert a polymer kg or tonne into pipe, okay? But everything is kgs [indiscernible] and tonnes.
So Pravin, let me put it other way that whatever capacity is there right now, we can easily take our revenue of INR 2,000 crore kind of level, plus INR 2,000 crores plus level, yes.
Okay. Got it. And the next question and the last question is related to the Bathware segment. And there also, you had reached INR 28 crore per month of 100. So what -- can you give some more color on what mix of the premium or the economic segment right now you are setting? And also if you give some geographical color as well where...
All right. Now, geographical color is very difficult to give because we are now selling to almost all the states. And there are a few pockets in the east where we have yet to penetrate. But otherwise, our display centers have opened up in India. And with regards to your question, obviously, the premium product category will not sell automatically. People will first gain confidence in the brand and then use our lower end and mid-segment product. And once they are comfortable with the brand and they get positive response and they see positive response from the market after using that. I think then slowly and gradually more of the premium segment stuff will get sold.
And at what level of revenue you are expecting a breakeven here abate?
I think we have said that around INR 10 crores to INR 11 crores kind of run rate, we will be at breakeven but it can be a little bit here and there also because once you get some field from the market, now you keep changing your strategy. So like now we are getting a good response in certain geographies. So we have started doing some branding activity over there. So we have to monitor the market. And with the time we have to change our mindset. So we were also not expecting that in the month of September, we will do INR 8 crores. So -- but we did it. So I think we are not looking at breakeven, INR 1 crore here and there. We are having a vision of the next 10 years. So for that, even if the 1 quarter here and there breakeven is not going to affect the company when our vision is for the next 5 year.
Okay. Great. So correct. And when the Telangana and Kanpur is going to commission.
So like Telangana, we are targeting by June, and Canfor will be by March end. So Q1 of '26, you will see the production capacity up and revenue.
[Operator Instructions]. The next question is from the line of Akash Shah from UTI Mutual Fund.
I just want to understand, sir, what was the key reason behind 44% growth in other expenses on a Y-o-Y basis. So in this quarter, we saw 44% growth in other expenses. So...
So what happened that in many times, the event which we have worked out for the promotional activity or maybe a branding activity maybe 1 or 2 months here and there. So because of that event base some spend you have to do. So in this first half, the events are more so because of that, the branding cost and the promotional activity was higher because most of our adhesive beats dealers meet and the 5 meets were happened in the first half and preferably in Q2 more. So because of that, that spend has jumped up very fast. So you can see in the coming half, this event will not be there. So that this event will not be there so the expenditure will come down in the second half. But our annual budget, what we have allocated to particular things will not go in to change. So it happened that on a quarter-on-quarter basis, it is very difficult to even out. But on a 12-month basis, it's definitely even now. That's why other expenditures are very high. And similarly, you can see the employee cost is also very high because we have appointed a lot of new senior management people within our team for the sanitary website also. And for the, you can say Adhesive side also 5 also, we have added the senior people. So their cost is not absorbed because once it even out in 12 months, it will be absorbed. So on a yearly basis, again, you will see the employee cost will not be that high. But right now, because of the lower half, historically, first half is 45% of the revenue in the second half is 55% of the revenue. So once it will be even out in 12 months, I think will not be that high of average.
Sure, sir. And what would be the advertisement spend for the whole year or end this quarter?
We stick to whatever guidance we have been giving since when we started doing our advertisement. We do about 1.5% to 2% spend on branding and promotional activity, like always, we have done.
Sure. And sir, in the hedge, what would be -- I mean, so the facility, what would be the revenue potential of that facility?
Price hedge. The hedge should contribute to minimum of INR 800 crore, INR 2,000 crore kind of revenue.
The next question is from the line of Dhananjai Bagrodia from ASK.
[Indiscernible]. wonderful execution again. I wanted is we have grown 28%, what would have been roughly industry growth at the same time?
I think it is very difficult to say industry growth because other companies' numbers are still not out. So it is too early to say what was the industry growth. But whatever our internal working sale that we should be -- we must have grown the market share in this quarter. So we have gained the market share in this quarter. But of course, actual number one will be out from all the other players, we will exactly will come to know.
So I can add to whatever Hiranand said, that if you look at our H1 FY '21 to H1 FY '24, 4-year CAGR as far as that grows, we are delivering at a 20.5% 4-year H1 CAGR. I think we are outperforming in the -- most of the industry's branded players by a long shot, and we have almost doubled our tonnage in 4 years, H1 to H1. So I think we are very comfortable with that type of tonnage growth we are seeing, and we remain bullish with our guidance to close the year also at a 20% plus tonnage growth level.
Okay. Sure. And just maybe a question, what did you say margins were in India and U.K. in the design?
So India was 15.5% and U.K. was 10%.
Okay. Congratulations for earlier.
The next question is from the line of Mr. Achal Lohade from JM Financial.
Just 2 questions. One is with respect to the DWC pipes. In terms of contribution, how large is that and most importantly, what I wanted to understand also is that has the REX played the way you thought at the time of acquisition? Or it has been kind of a little laggard?
So DWC is a significant business for us and looking at what the infra spend numbers and reports are coming out. Yesterday only I was reading that India will spend more than INR 143 trillion for infrawork in the coming 5 years. It's a very positive sign for a product like double-wall corrugated pipe. And the acquisition has played out well for us. Obviously, we don't give segmental-wise numbers, but we are doing very good volume growth in our double wall corrugated pipes. And we see this going in the same run rate for the next couple of years. So I don't see any much slowdown. Actually, we are -- most of the places our capacities are running at almost full level.
I can add further to what Kairav said that you don't look REX as an independent company. But in the reg premises, we have started manufacturing the other pipes also. So that business is also picking up very fast. So that is also giving us a good support from that location. So that is also adding to our growth as well as our margins.
Understood. And have you also been beneficiary of the spending, which is happening in the Astral D Rex program in terms of -- and which segments, is it in only DWC -- or is it in...
So sir, DWC is usually not there in Astral D Rex program because Astral D Rex is a freshwater drinking water supply scheme. So double-wall corrugated pipes are used for drainage application. So double-wall corrugated pipe application is very different from the type of pipes that are used in multigenes.So Nursel predominantly uses HDP and pressure agri pipes in their scheme. And we have taken some Astral D Rex orders, but that has all been done at the local level by our distributors. We do not deal directly with the scheme. Our local distributors, if they get an Astral D Rex order, they take that order, we support them.
Got it. And if you could also give some heads up on the storage tank as to how it is building up like you talked about Bathware, you're looking at a INR 10 crore in the next couple of months. So how is the run rate for storage tanks now -- and what...
I think we have stopped giving individual numbers in the beginning of the new product journey, we share that number. But at a later stage, we don't share because unnecessary, we don't want to create unhealthy things in the market. So we normally don't see that way because sentencing all or the new segment, that's why we are saying over a period of time, we will not be sharing the individual number into that segment also. Ultimately, we want to keep it this confidential. Unnecessary, everyone will pat each other the competitors also, so which we don't want things to happen. But I can say think is giving us an excellent number, whatever we originally planned, we are going ahead of what we originally planned. So from that, you can understand the growth is going beyond what we have originally planned.
Actually, tank is where the brand play comes in because Astral is a very strong brand. Whenever people want to buy the water tank, they look at the label Astral on the tank and immediately, the sale happens. So hence, we are commanding a premium in the market. We are selling at our pricing, and yet we are selling good numbers of tank, and we are very bullish and that is why whenever we launch a new facility, the first product we manufacture is tanks.
Lovely. Sir, just one clarification. Your tanks and both the DWC pipes, they would be better margin than the blended margin, what you're reporting. Is that a fair understanding?
So tanks will be closed through our piping margin, initially was not there, but now with this growth in the volumes, it will be closer to our pipe margin. DWC will be, I think, a couple of percentage lesser than the normal part.
Wish all the best.
The next question is from the line of Sneha Talreja from Nuvama.
Congratulations for [indiscernible] numbers. Just 2 questions from my end. I just wanted to understand that the plant in position. Is there other at implementation things and everything settled? And secondly, more on to that, what kind of synergies are you seeing in that particular business with respect to Editis, have we started receiving benefits? Or what's the vision here with respect to the synergies between both in paint and additives, which you used to point out at the time of acquisition.
Still we are working on the back office side and the plant levels and all. Still, our team has not yet taken the charge on the front side that is on the sales and marketing side because we said that we are going to complete the 80% acquisition in this month I think once that 80% will be completed, then our team will be taking front roll in the sales and marketing. And then in a period of time, we will keep communicating to the market whatever we feel that it is necessary to communicate to the market. A lot of synergies are there, a lot of things are there. Otherwise, we should not have entered into that business. So we are seeing a lot of synergy with the ASUs and a lot of synergy with the pipe side also on the project business and all. So -- but this all will be unlocked over a period of time. I think it will be too early at this stage to communicate that we are going to build, we are going to do that. We don't want unnecessary crude close the Griffin in the market. So at the right time, we will definitely go into company set to the market.
Understood, sir. And secondly, sir, for particular quarter, will some inventory levels moving up. Any specific reason for that? And do we expect a trouble because of inventory, I mean, PVC prices have been coming up [ indiscernible] in a very short time. So is that inventory related to PVC or how is that pace will be happy to...
Major inventory related to the CPVC because our company is more of CPVC driven. Secondly, you should also understand that we are growing at a 50% volume. And that so in our top season. First half, I said that which is 45,000. Our seasonal ones are going to start now. So we have to start sourcing the inventory little in advance. So I think it's not going to give us a much pain in the coming time because CPVC is not going to fall further from here on. That is what we are expecting. Of course, we are not expert into that side, but we are of the view that our seasonal months are starting. And secondly, we know that a lot of our dealers and distributors have done destocking in the month of September because everyone was expecting that the prices to go down. So because of that, also a little higher inventory there, but I think that will be sold out in the month of October itself. And we are expecting this month also similar to what we have done in H1. So it should not be the problem for inventory. It will come down immediately in the month of October.
The next question is from the line of Pinaki Banerjee from Home Capital Private Limited.
I actually have a couple of questions. So all the CapEx which will be coming on at the beginning of next financial year, how much growth are you expecting in FY '25?
FY '25, I think we will guide you once we will be completing the year. Our long-term guidance we've already given to double the top line or the volumes in the next 5 years that we already communicated our long guidance, particularly next year, I think we will be able to tell you once we complete our Q4 number.
Okay. Let's considering the fact that you are already sitting on a cash of about INR 53 crores. So mono this undergoing CapEx, do you need to take any further debt or would you see full internal actuals on this?
I think out of that, the INR 275 crores, I think INR 275 crores to INR 280 crores will go away for the 80% acquisition to Gen pain, then the cash level will come down. Basically, we are not completed, but they are doing some compliance work. So because of that, the payment has got a little delayed, but we are confident that we are able to complete this by this month itself.
[Operator Instructions]. The next question is from the line of Bhavin Pande from Athena Investments.
Congratulations team. Just one thing I wanted to understand. So despite just correcting the reported phenomenal amount, so was it largely on account of operating leverage or we did some initiatives at that as well as.
Can you repeat the question? We were not able to listen later parts.
Sure. So basically, I mean, margins have shot up well despite sort of is collected. So what of operating the volume so some rating.
So whatever little bit I understood the early part, I'm replying you because later part, again, is not clear, but your question was relating to the margin. I think margins are normal margin. There is no abnormal luckily in the margin, which is a normal margin, whatever we deliver every year. So nothing is special in this quarter. But yes, looking to the volatility, I think margins were good. We were able to manage somehow the volatility in the regime price. And secondly, you rightly pointed out the volume growth always helped to maintain your margin. So this first half, the volumes were pretty decent, 330% volume growth. So that has also helped in the economy of scale. And secondly, with the addition of the new plant, that also help you to improve your margin because you are going to supply from your local plant, near plant. So that will save a lot of money into the logistics side. So that is also helping us. So overall, put together, these margins are there, but we don't see these are the abnormal kind of margin on the either side.
The next question is from the line of Manan Madlani from Kamya Car Wealth Management.
Yes. Congratulation on great set of numbers. So my question was what could be [indiscernible] and it business growth on -- for H1 on a Y-o-Y basis? And have you got any export order for biparticularly?
So I think individual category number we don't share, but I think overall, we have given that we are targeting INR 1,500 crore revenue from our new launches whatever, whether the drain pro, silence your paying tenters, wall and then paint and all. I think we are going esperthatread. So we can say that they are doing all good, otherwise, these kind of maintaining the margin without the value-added product is not possible. So value-added product contribution is healthy. That is why we are able to maintain our margins. So it's doing good, but we will not be able to share you the exact number or exit growth on that particular category.
The next question is from the line of Per from Niveshaay Investment Advisory.
So just wanted to understand from the Kanpur plant closure part, which you indicated forit was for adhesives, right?
Yes, it is adhesives.
What is the reason for such closure? And how do we manage the capacity levels that are going to reduce going forward?
On reduce, actually, we are moving certain of their equipment to our Rania plant. Most of them have moved and some of the vessels are moving to the edge. Actually, the capacity is going to go up, not decrease. And none of these equipments which are there making products are going to go away, they are actually moving to different locations. And in Rania, which plant do we have in Kanpur has been consolidated to one plant. We bought land, we have built buildings and we have moved most of the products to Rania plant and some of the products will be moved to the hedge plant with additional capacity. So we are not -- we are closing the plant, but not reducing the capacity. So this was the oriental understanding with the original promoter that after 7 years, we have to give back the premises to them. Now on now premise is only... And which is a smaller premises compared to our Andaba premises or [indiscernible]. So that was originally part of the deal. And accordingly, they have given us a little extension of 2, 3 years because of COVID and all. So now we have to give back that primates to that. The reason of moving this plant was that this plant is surrounded by most of the residential place so we have to move out of the locality where there is more residents than the plant.
The next question is from the line of Ritesh Shah from Investec.
First question is for Sandeep. Sir, a little bit of different questions, sir, when do we say no to an order. The reason I ask is a lot of roads [indiscernibe] orders which are there. So when do we say no to order? Is it working capital? Any sort of margins that we look at? How should we understand this?
We don't say no to any order Ratesh. We do supply to projects. Even if you are pointing to government projects, we have done many projects. If you go the [indiscernible] stadium is full of stent products, the state of Liberty is with product and many other [indiscernible]. And many other projects we are supplying, but mostly, we go through the big contractors like LNP, Shapoorji or contractors, which are regional based. Today, we are doing a big project in one of the big towns of Gujarat, giving them storage and grange pipes. And this is also going through a very big contractor. So we don't mostly say no to the projects, except we say no to the projects when we are not having capacities. This is the last option.
In fact, yesterday also retain, we have got INR 20 crore single order from the very good project of government, which I will not disclose the name in all this, a single order of INR 20 crores. So we are doing but through our channel only so that our money is safe and which give us a reasonably good margins also. We don't want to sail the product with raw materials at INR 3 or raw materials at I INR 4, what many other players are doing.
Ritesh, so iterate add to what Hiranand Sandeep is saying that we don't explicitly deny taking any deny anyone when they come asking for the material. But yes, we do have a threshold where if we are not making any money on this particular supply, there is no use for us to take that order. So if it is at a regime cost or regime plus INR 2, INR 3, INR 4, there is -- then you are losing money on that order, there is no -- we let such orders go also.
The next question is from the line of Keshav Lahoti from HDFC Securities.
Just one small follow-up. So the INR 2,000 crores, the capacity is polled by addition, right, the number you said?
No, no, not additional INR 2,000 altogether will be generating INR 2,000 crores reval.
That is including the hedge, full ramp-up.
Yes.
The next question is from the line of Aasim Bharde from DAM Capital.
Just wanted to understand on CPVC price movement. So you say they have bottomed out at current levels that should stay here. Can you just tell me how much does CPVC price is correct from its peak to now?
Very different and difficult to say because there are so many manufacturers and each of them is quoting their own price and their own comfort levels and their own margins. And just for one particular supplier, how much that would be a hypothetical. PVC prices have dropped 50%, right? CPVC is our presence. It is our key thing, and we won't -- I want now to share these numbers because these are things which people keep the eye on us, and we are a very effective buyers. So it is difficult to share all these numbers on CPVC. CPVC is something which is get close to our heart because we do the best of the buying and everyone is running at their speed. Japanese are giving different price. Koreans are giving different price. Every country is cutting the different price. So very, very difficult to predict what current price is there in the bank.
I understand just that since the CPVC prices dropped 50%, I'm just wondering, is there more downside left in CPVC or no? Because as per my experience, this is the bottom, what we are taking.
The next question is from the line of Akash Shah from UTI Mutual Fund.
Sir, just wanted your thoughts on U.K. business, sealed. I mean, sir, will you please share revenue outlook and margins for this business?
I think U.K. is doing good. In this quarter also, U.K. has given us a good growth, close to about 17% in top line this quarter. So U.K. is fairly doing well. Margins this quarter were 10%. Otherwise, normally U.K. 11%, 12% kind of margin. And we are expecting second half should be coming back to the normal margin. So we are very happy with the performance of U.K.
Sir, just one thing, sir. This is a sort of matured market. So can -- I mean, what would be the sustainable growth rate for this business?
I think it depends what new products you are launching, what new strategy you are bringing on the table. It depends on many things. I agree with you that it's a mature market. So getting growth is always a challenge. But you'll look at the number of U.K. operation, the time what we acquire and what is the today number. So we are continuously adding the new product, continuously adding the new customer. Even recently, also, we have added a couple of big ticket customer. The number will be reflected in the coming time. Maybe second half, you will see some effect on that because of these 2 new customers. And secondly, you will see a reasonably high growth number because of these 2 big ticket new customers. So it depends which products you are giving to them, which chemistry you are offering. So we are working on that, and we'll see that how we can add more chemistry over there.
One more thing that today in U.K., all the competitive companies which were competing against where we are bigger than us also are being acquired by big multinationals. And because of these, there are a lot of policy change, pricing changes, all these coming and this in the last 2, 3 years is giving great advantage for us for reaching out to bigger DIY customers who are -- who want to tie up and are tying up with us actually in that market. Second is all these markets are not matured at all because of their climate conditions. Their houses need continuous repair waterproofing and that is where the continuous flow of many products happen. And third thing is we are going to -- we have actually started getting export orders, and we are going to work in a big way in the release to tie up and sell many products made out of U.K. and U.S. and India.
Sir, this was something new that I heard. So sure. So basically, there is an export opportunity as well from India or U.K. market to Middle East.
Yes.
Yes, we have already started, and we have already started getting orders also. That's why I can proudly say that we have started working in this one.
Sure, sir. And sir, just last question, sir, the hedge facility. Can we say that by FY '26, we will be able to ramp it up until, let's say, the revenue potential that we had discussed about INR 1,800 crores? Or would it take more time, say, FY '27 or '28?
In crores, we won't early, but market should support. I think whatever we have given the guidance, you forget about particular specialty, what they are going to be. If you look at the overall picture of [indiscernible].we hope and think that we will keep growing 15%, 20% run rate annually. And I think we are very well on track. In fact, if you see the last 3 years growth, I think we are much ahead of what we originally guided. So I think we are very bullish on that segment of the business. So we'll keep growing at 15%, 20% run rate. And if the market will support, we can grow even faster than that. And in past also, we have delivered that number also more than 25% also growth we have given. So it depends on how the market is supporting us. If the market will open, definitely will be the first player to move into the market.
Secondly, there is the major advantage, which comes for us is the storage is all in bulk. Today, can we buy the product to manufacturer -- to manufacture our product, it comes in lose packing of grams of 200 litres or 250 litres packing. And we have to sometimes send the product right from the hedge area to Ancora [indiscernible]. Most of the raw materials of the chemistry which are -- we have put in the hedge. The 80% raw material is made and available from there. So one advantage is there. Second advantage for pricing will happen for the raw material as we buy in bulk, we'll store in bulk storage in tanks and the brown tanks, overhead tanks. And so that will also save a substantial amount on packing of the raw material in coming years. So bag is going to be -- and all the chemicals will move through automization in pipes. So there won't be any spillage or wastage also happening.
Okay, sure. Sure, sir. Sir, and just can I ask just one last question, if possible.
Yes, yes.
The next question is from the line of Rahul Agarwal from Incred Capital.
Congratulations for the good set of numbers on the piping side. Sir, first question was on capacity. As I understand, you said 20,000 tonnes got added. Was that Arista? That was one clarification I needed?
No, no, no, not Arista. To our hedge -- I'm sorry, this Santa plan some edition, some solar and some to our Kanpur also.
Okay. So when I'm just -- I'm trying to calculate March 26 numbers for overall capacity. My sense is, as of now, 3 like 10,000 tonnes are already there. If I add up Guwahati, Hadara and Kanpur, that's about 40,000 tonnes. And I'm assuming that over the next 2.5 years, we will add another 20,000, 30,000 tonnes of balancing. That basically means that we're going to add another 170, 180, so about 2 lakh tonnes on a base of 3 lakh tonnes. Is that correct?
Yes, correct.
Okay. Perfect. Second...
A number also because we never had a so quick that capacity. But look at the last 3 quarters number. The volumes are coming very huge. So we should not shy away. And if we feel at any point of time that the market is not supportive, we can a little bit delay also. And if the market is supportive, we can prepone also because cash flow is not a problem to our company. So it depends on the market condition, we are continuously monitoring the market conditions. And based on that, we are telling our project team to gear up. So it is within our control. So whenever we feel that we won't little early, we will try to -- even there is still scope available within our existing plan because we are having capacity or pre-land available at our Dolca. Plus we have recently added a new parcel of land at Dolca also. We have some scope available with our Santa capacity also. We have a spare capacity will mean we can add more capacity in our Belo plant also a very state-of-art fitting plant is coming up in the ballot also. I think almost building out is on the verge of completion. And hopefully, shortly, we are targeting to put up the machine. So very sizable plant is coming for the fittings over there also. So I think across all the plants, we are adding the capacity. And there is still room available. So we are working with closely with our technical team that how additional 20,000, 30,000 metric ton you can add within our existing plan that is going to aid and support our organization. So we are working on that also. So capacity will not be a problem to our company.
So, Absolutely, sir, I understand that because my sense was 2 years back, if you remember, we've been discussing that CapEx for Astral will actually come down. But fortunately, the volume growth has been so high that we have to actually increase our CapEx. So that's good.
When you look at the last 3 years, number last figure, we have doubled ourselves. So we have not joined ourselves to increase our capacity. I always feel that now we should put some break, but the growth is so fast and so quick that we have to do like that. And still, I think whatever we have discussed and said and done, we are working on many things in the organization in every vertical, which we cannot disclose in at one. So at that right time, we will keep disclosing the thing, but we are working on many things. And continuously, our work is on with new products, new things in the organization, automization, many, many things we are working. So at an appropriate time, we'll keep disclosing that thing to investor community because there is no point to disclose at this stage. So I think we are working on a lot of new products also. We will keep communicating you one by one once we will be ready at the stage of launch. Recently, we have got this [indiscernible] comunicator, but no one had highlighted that thing in the question-and-answer session that is the ISI in the fittings for this fire sprinkler also. Fire spinkler is a very, very big opportunity. And I can give you a list of projects which recently Astral has got, and we have completed also many. So there also a lot of scope is there. fingers crossed, we will be giving you these kind of things every quarter.
Yes. Sir, good news that's happy to know. And this fiscal '25, I just wanted to quantify the CapEx number. We understand the volume additions. But as you said, INR 350 crores plus INR 75 for current year, fiscal '25 will be earlier, I think last quarter, we discussed INR 250 crores, will that be higher too or is that 250s?
I think land acquisition has completed all the locations. Telangana also land is covered this year, and this Canfor land is also covered additional parcel of Dolca is covered this year. I think corporate office lend is also covered this year. I think next year will not be at that cost. So whatever we have said will not be increasing to that.
So I should assume INR 250 crores, right?
Yes, INR 250 crores to 300 crores.
Okay. And one clarification was on the plumbing side and on the volume, 52,000 tonnes. I'm assuming there is nothing included of Bathware there, right? I mean Bathware is sold in pieces, but I just want to clarify because....
Sale is only INR 18 crore in billing. It is nothing negligible.
Okay. Perfect. And lastly, sir, on the inventory loss, how is that accounted? Because when I say gross margin is actually up Q-o-Q. So just wanted to understand that.
So if we are not accounted that then the gross profit margin could have improved a little further.
Okay. So it's basically part of raw material costs, right?
Yes, it is a part of the raw material.
And this is all realized loss, right? There is no mark-to-market on the 30th September inventory, right?
No, mostly realized.
All the best.
Thank you.
The next question is from the line of Manan Madlani from Kamya Care Wealth Management.
Sir, we were going to appoint a senior employee for our paint segment. Any update on that?
I think we have already appointed and he has already joined in the organization.
Okay. Congratulations on that. And are we planned as specifically for our master segment no?
Already in Bathware so a senior person is doing in the marketing. And in the design also somebody...
I mean on the advertisement part.
Both Vathware advertisement, we have started so slowly and gradually, sir, we are doing, but we need to also get some of the sales going on because only spending money and not building the showrooms and creating channel and selling -- only doing one way advertisement is also not good. So we like always, in the case of our other category, even adhesive also, we reached a certain point before we started doing advertisement. Even in the piping business, we reached a certain level before we started doing advertising. Similarly, in Bathware also, we have kept a certain threshold before we will start doing significant advertising.
Sure.
Because it makes no sense.
Yes, fair enough. All the best.
The next question is from the line of Bhavin Rupani from Investec.
Sir, just one question. Did you have any channel financing arrangement through the bank?
Yes, we have channel finance, but non-recourse wages. So we don't give any guarantee to the bank.
Okay. And what would be the amount of that as on September?
We don't track that because we have not given any guarantees, so we don't track that because it's a direct understanding between distributor and the bank.
Okay. So are we paying any charges for that? Or is it owned by the dealer?
No, because it's a direct deal between 2. So we are not in the picture. We are only a supportive role we are playing. Whenever bank need any information on data, we are sharing that with the bank. Otherwise, we don't pay any single penny to the bank.
Okay. And this scheme is applicable for the dealers in Bathware segment as well.
So market, yes, a few have started, but the market base is still very low. So still a lot to join in the coming tax.
We will take that as a last question. I would now like to hand the conference over to the management for closing comments.
So thank you, everyone, for joining in this call. And wishing you a happy Diwali and a prosperous new year and will connect after this quarter is over again. Well then have a great festive season, all of you with your family and friends.
Thank you, everyone, for joining, and nice Diwali, and we wish everyone the best in the coming year, and we will see you after our Q3 numbers. Thank you.
Thank you, everyone, for joining this call. And if we have missed anyone to answer the question, you are free to call me personally any time post this con call. Thank you so much and wishing you a very happy Diwali and happy New Year in advance. And thank you, Arun, for hosting this con call. Thank you, everyone. Thank you.
Thank you. On behalf of ICI Securities -- ICICI Securities, that concludes this conference. Thank you for joining us, and you may now disconnect your lines.