Q2 25/26

Nov 10, 2025

Summary

Q2 results reflected weak domestic demand, while a one-time INR 64 crore provision reversal boosted reported EBITDA. Management expects demand and volumes to recover from calendar 2026, with FY27 volume guidance of 8-8.5 lakh tonnes.

Ladies and gentlemen, good day and welcome to the Q2 and H1 FY 2026 earnings conference call of Electrosteel Castings Limited. As a reminder, all participant lines will be in the listen only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing star and then zero on your touchtone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Hiral Keniya from EY LLP. Thank you, and over to you, sir. Thank you, Sadhu. Good evening, everyone. On behalf of Electrosteel Castings Limited, I welcome you all to the company's Q2 and H1 FY 2026 earnings con call. To discuss the performance of the company, we have with us from the management team, Mr. Madhav Kejriwal, Whole-time Director, Mr. Sunil Katial, Whole-time Director and CEO, Mr. Ashutosh Agarwal, CFO, and Mr. Gaurav Somani, General Manager, Finance. Before we proceed with this call, I would like to draw attention to the fact that today's discussion may contain forward-looking statements that are subject to various risks, uncertainties, and other factors which will be beyond management's control. We kindly request that you bear in mind that there may be uncertainties while interpreting such statements. We will now start the session with opening remarks from the management's team. Afterwards, we will open the floor for interactive Q&A session. I will now hand over the conference over to Mr. Madhav Kejriwal for his opening remarks. Thank you, and over to you, sir. Thank you, Mr. Hiral. A very good afternoon to all. Thank you for joining us. The environment over the past few quarters for the ductile iron pipe industry has been challenging, and this quarter reflects the same. The ductile iron pipe segment continues to face demand slowdown due to delays in government spending. Consequently, production levels have been moderated, costs have increased, and there's a downward pressure on pricing. Collectively, these factors have impacted profitability and created a challenging operating environment. That said, despite these headwinds, our other business segments such as cast iron pipes, ferroalloys, DI fittings, and exports, along with the higher other income, have supported the overall performance. Our balance sheet continues to remain strong, underscoring the company's inherent financial resilience. We are certain that the current phase is a temporary adjustment rather than a structural shift. The sector fundamentals remain strong, and we are optimistic about the medium to long-term outlook. The nation's development vision is deeply linked with the creation of robust infrastructure, and we see the government's continued commitment to expanding drinking water and sewage networks as a major driver for growth. With this, I'd like to hand over to Mr. Sunil Katial. Good afternoon to all. With the extension of the Jal Jeevan Mission to 2028, coupled with expected demand from river interlinking projects, irrigation through pipe networks, and the replacement and maintenance work which is coming for the old pipelines and all that, underpins our confidence in the long-term growth trajectory of the sector. While the pace of recovery may take a quarter or two at the most, as it looks, we anticipate a strong rebound beginning in calendar year 2026. Additionally, I'm pleased to share that following our acquisition of the TIS valve business in Europe, we are progressing with plans to integrate valves into our product portfolio overseas as well as in India. To conclude, while the challenges we face are transitional, the opportunities ahead are transformational. With robust demand drivers, government initiatives gaining momentum, and our expanded product portfolio, we are confident that Electrosteel Castings is well-positioned to deliver sustainable growth and create long-term value to all our stakeholders. Thank you, and we are looking forward for sharing more details as we proceed. With this, I would like to hand over the floor to Mr. Ashutosh Agarwal, our Whole-time Director and CFO, for taking you through the financial highlights. Thank you, Katial Ji and Madhav Ji. Good afternoon. A warm welcome to all the investors joining for this call. Sales volume of DI pipe fittings and CI pipes during the quarter stood to 1.39 lakh tonnes, down by 28% year-on-year, which impacted the overall financial performance of the company as intimated by Madhav Ji and Katial Ji. For the half year, sales volume was 3.02 lakh tonnes, a 25% decline compared to H1 of 2025. Decline in volume was primarily due to slowdown in the domestic market. However, export market volume grew by 8% year-on-year, partially offsetting the weakness in domestic demand and providing support to overall business performance. During the quarter, other income includes provision written back to the extent of INR 64 crores, following the settlement of entry tax matter of West Bengal government, which was one-time payment only. This provision has been created in the books during the financial year 2013 to 2018, and the following settlement, it was no longer required. The reversal also resulted in the corresponding reversal deferred tax amounting to INR 21 crores. Net debt at a standalone level stood to INR 1,626 crores. The utilization increased by around INR 230 crores compared to June 3rd, 2025, mainly due to cash outflows relating to acquisition of valve company and other business requirements. Interest cost more or less remained stable in spite of high utilization, supported by lower borrowing cost. I will take you through consolidated financial results for Q2 2026. The total income stood to INR 1,491 crores, lower year-on-year, primarily due to reduced in sales volume. EBITDA, including other income, stood to INR 188 crores, with an EBITDA margin of 12.6%. EBITDA excluding provision of write-back of INR 64 crores, intimated to you earlier in this statement, stood to INR 124 crores. PAT was reported at INR 78 crores, translating to PAT margin of 5.3%. I am highlighting our consolidated performance of H1 2025-26. Total income stood to INR 3,077 crores. EBITDA was INR 386 crores, with an EBITDA margin of 12.6%. EBITDA excluding write-backs stood to INR 322 crores, and PAT was reported to INR 167 crores. Moving to standalone results of this quarter. Total income stood to INR 1,283 crores, lower year-on-year due to reduced sales volume as intimated by Mr. Madhav Kejriwal. EBITDA was INR 124 crores with an EBITDA margin of 13.5%. EBITDA excluding the provision written back of INR 64 crores stood to INR 110 crores. PAT stood to INR 76 crores, translating to PAT margin of 5.9%. I am highlighting our standalone performance of H1 results. Total income stood to INR 2,709 crores. EBITDA was INR 360 crores, with an EBITDA margin of 13.3%. EBITDA excluding provision, the write-backs stood to INR 296 crores. PAT reported to INR 162 crores. With this, I would like to open the floor for the question answers, if any. Thank you very much. Thank you very much. We will now begin with the question-and-answer session. Anyone who wishes to ask a question may press star and then one on their touchtone phone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. Again, to register for a question, please press star and then one. Our first question comes from the line of Pujan Shah from Molecule Ventures. Please go ahead. Hello. Yes, please. Yes. My first question pertains to, as we expected, the demand would revive or rebound starting calendar year 2026. Just wanted to understand on your part, sir, what makes us so confident enough that the demand will rebound, because in the last 12 to 15 months, the JJM has been slowed down and we are witnessing challenge in terms of fund flow. Just wanted to understand your view. Sir, there is definitely work pending to be done, which is evidenced from the fact that there is adequate order book in the market. It is about whether that order book materializes to material getting dispatched. The level of activity that is taking place, if you see even in the news, it is highlighted that the central government is working towards getting clarities on certain issues that have been reported to them. They are doing this because they have a clear intention that they need to clarify these issues and continue with the project and implement whatever is remaining to be implemented. This Jal Jeevan Mission is definitely something that is there at the center of the government's attention, and they want to move on with it and tick mark the complete box. For that to take place, they will have to allow the projects to finish, and that will require funding, and they are quite keen on that once they get clarity on certain issues that have been highlighted and reported to them through the local authorities and by the society and population in general. Got it. Just wanted to understand the second thing is, we have seen some key challenges also by the government. There was a key notification also mentioned by the government that some work has not been done as per the project timelines. Is that outcome has been considerable by the government, or it is still under purview by the government? Sir, there are multiple issues that have been highlighted to the government, one of which is non-timely completion of projects. In certain cases, that is a fact. Now, some of the delays have happened due to funding constraints, some delays have happened due to operations, some delays have taken place due to administrative problems. It's kind of a mixed bag of a lot of things. The problem is that water being a state subject, the administration is very much distributed and diluted at the ground level. To accumulate and come to a conclusion for something like that takes time. That's why they're taking a little longer than what it should to come to conclusions for the underperformance. Once that clarity is there, I'm very certain that things will restart. I'm sorry, you'll have to forgive me. I'm a little unwell, so I might break in my sentences. Yeah, not at all an issue, sir. The long and short story is that they will take a little bit of time to come to conclusions of why certain delays or certain incorrect laying and other such problems have happened. Most definitely corrective action and further implementation of the program will happen. If that was not in the interest of the center, then they would have probably not extended it with an enhanced budget. They wouldn't be following up so aggressively to draw conclusions. It's because they can restart the process. I've got it, sir. My last question would be, the government is representing that they have done work of around 81% of what they have been planned to commit it. Just wanted to understand on ground reality, how much percentage of work has already been laid off, or how much percentage of work has been done considered to what they have been stating out? Sir, functioning household tap connection would be close to 50%. Okay. Between 50%-60%. Still 40% work needs to be done than what- I would say from the supplier pipe perspective, around 40%, and from the work on ground perspective, probably 50%, 55%. Okay, got it. Thank you so much. I will join back in the queue. Thank you. Our next question comes from the line of Sailesh Raja from B&K Securities. Please go ahead. Yeah. Thanks for the opportunity, sir. There was an article in the Indian Express today mentioning that the central government, as you rightly pointed out, that they have been taking actions against several officials and contractors across multiple states and union territories also, following the complaints that they have received regarding the financial irregularities and poor quality of work under the JJM. Some states still they have not shared complete details with the central government. Do you think that once this review process is fully completed, then the government will resume, or they will accelerate fund deployment under this JJM program? You are confidently saying that from the beginning of the calendar year, the government will deploy their fund. Can you give clarity on this? What gives you the strong feeling that it will start? Based on the progress they've made so far and the further inquiries that they've shared with the states, that makes me feel that starting calendar year, they would have reached their conclusions and they will start opening up the funds. As and when they do that, there's always a delay of 2, 3 months for it to show in your books, in your performance, because there is that buildup of stock and everything that's associated with it. Like how when there's a slowdown, it took a quarter to take effect. Based on those movements that I see, I am fairly confident that starting next calendar year, things will start moving. Right now, there's a deadlock because of dissipation of information and scrutiny. Once that scrutiny comes to a conclusion, based on the conclusions of the scrutiny, maybe some states will start much faster, some states will require further scrutiny. But definitely it will start. Okay. Sir, can you give volume guidance in this year? Also, if demand comes back, can we expect double digit in terms of kg, I am asking. So in this quarter it is around INR 6, INR 6.5. Can we expect this is bottom or we will see further correction in next two quarters and next year with expected improvement in the demand? Can we expect double digit EBITDA per kg next year? Because you know that there is an increased supply in the market. If you please give clarity on this. Sir, starting next year, I think starting quarter 2 next year, we can start seeing a dramatic improvement in the production levels and also in the margins per ton. Definitely, I think a double-digit margin per ton is very much achievable. Okay Starting Q2 next year. Q1, things will start moving. Q2, there will be a pickup. Then by Q1, there will be a pickup. In Q2, we will be pretty much established at This is financial year you are talking, is it? FY, yes. Yeah. First quarter 4, this FY and then Quarter 1, Quarter 2 next FY, you will see an incremental improvement as per our assessment. Okay. So what is the total volume you are expecting this year? This year, possibly it could be 550,000 or around that. Okay. Sir, what about the next year, sir? How much you are expecting with whatever that you are saying that it will come back? So in that case, what could be the numbers for the next year? Next year, as of now, we are thinking that we should get to possibly between 8 lakhs to 8.5 lakhs, in that range. Okay. Great, sir. Sir, what is the CapEx plan we have, sir, this year and next year? For this year, predominantly, we are focusing on sustenance CapExes. At Srikalahasthi, we are rebuilding one of our battery. Apart from that, the major focus is definitely on sustenance-based CapExes. A figure, it may be difficult for me, but possibly around INR 300 crore also, everything put together. Okay, sir. Thank you. This would include minor debottlenecking capital expenditures as well. Okay. A mix of maintenance and debottlenecking. There is no major CapEx per se that is planned for this financial year or the next. Okay. Thank you, sir, and all the best. Thank you very much. Thank you. Our next question comes from the line of Rudraksh Raheja from ithought Financial Consulting. Please go ahead. Yeah, thank you for the opportunity, sir. Sir, could you throw more light on the gross margin expansion in H1 FY 2026? We have seen some revenue contraction, but gross margins have expanded. Yeah. So high gross margins was around 48% for the first half. It has been more in line with what it was last year because the prices of the products have come down, but also at the same time, raw material prices have also come down, hence gross margins have been intact. Revenue has come down, yes, because what we said, as we mentioned, the volumes were lower, so revenue got impacted during this first half. Got it, sir. And sir, the other income component is higher in H1 of FY 2026. Could you provide more details on that? Other income increases just because of reversal of our previous liability, which I have said in my opening remarks on account of this entry tax matter. Entry tax matter got resolved, and there was a case going on with the government of West Bengal. INR 64 crores amount has been reversed. That is why the other income has increased in the P&L. Got it, sir. The employee expenses, I am assuming that since we have added some capacities since last year, so employee expenses have increased in line with that. So going forward, do we see this INR 150 crores-INR 160 crores as the quarterly rate, or do we expect more increase in employee expenses? There might be a marginal increase in the employee expenses as we expand our business in the valves product portfolio. In fact, this increment is largely related to that portion. There will be a marginal increase, but it will not be substantial enough, really. It might be that it goes to INR 165 or something like that. Understood, sir. I think I may have missed on the volumes part. You said you were expecting around 5.5 lakhs in FY 2026. Between 5.5 to 6, somewhere between that. Yeah. And how much have we done in the first half? 2.7. 2.7. Okay. Understood, sir. Do we have a sustainable maintenance CapEx that we have to incur every year? Let's say we are not expanding in any year, but still we have to incur some maintenance CapEx. Do we have a number for that? Well, in fact, we had a broad plan, for next three, four years. We had planned that, possibly it could be around, say, INR 500 crore for next four years. So, any kind of CapEx addition would be over and above this INR 500 crores? Yes, please. This is as already clarified, it is predominantly for sustenance and some component of that is for debottlenecking only. Understood, sir. Understood. Thank you. Thank you. Thank you. Our next question comes from the line of Deepesh Agarwal from ICICI Prudential AMC. Please go ahead. Hi, sir. Good evening. I can see there is a dramatic increase in your overall cash and bank balances. Like on a consolidated basis, we have gone up by more than INR 400 crores. Is this on the back of the subsidiaries or anything else? There were some fixed deposits which as per Ind AS, beyond 12 months were clubbed in other non-current assets, which are now supposed to get matured and hence has been transferred to current assets. It was always there in the books. All right. Where is our current capacity standing? I think we had plans to scale up to 1 million tons by the end of this year. Where are we standing, and are there any plans to incur any more capacity addition? We were looking at a capacity expansion to 950,000 to 1 million. At the moment, our installed capacity remains at 850,000 tonnes, and we are hoping to get to 90%-95% of that figure next financial year. Due to the slowdown in the domestic market this financial year, we have had to moderate our tonnages. As mentioned, we will be getting somewhere between 5.5 lakh to 6 lakh tonnes, 550,000 to 600,000. As for the CapEx, for the expansion from 850,000 to 950,000, at the moment, we have kept it on hold till there is a cleanup of inventory and pickup of capacity to 850,000 tonnes, and after that we shall take a decision. Right. Just a couple more questions. During previous calls also, I think you have highlighted that in order to reduce the dependency on JJM and expand more revenue streams, there were certain other investments being done in terms of gaskets, in terms of the acquisitions and even the subsidiary we had and even acquisition we made in Vietnam. So any update on or any progress that has been made in all of these areas? Acquisition in Singardo International, I think you mean. Vietnam is a company- I meant with Singardo. It is Singardo. Singardo, we have seen positive results for the quarter and half yearly. There is a slow increase in the other product portfolio within Singardo, where we are seeing that almost 40%-45% of its revenue is coming from other items that we are buying and selling over there for the water and gas companies. As for TIS, it has only been merged. It has been two months. We are very much deep into the integration process, and I think by the end of this FY we will be pretty much in tune with them. There are aggressive expansion plans that have been put in place for that. Of course, once they are concrete, we will be able to share them exactly with you. But definitely, these two factors are going to play, especially the valve is going to play a big role in diversifying our portfolio and our both geographic and customer base. All right. Thank you. That is all I have. Thank you. Ladies and gentlemen, a reminder to all the participants, you may press star and then one to ask a question. The next question comes from the line of Rajesh Aggarwal from Moneyor. Please go ahead. Sir, out of the pending order of 6 to 7 months, how much is government order of Jal Jeevan and private orders? Can you quantify that? Around 60% would be JJM. Okay If you include domestic, it will be around 50%-55%. Okay. The rest is non-JJM and export. Okay. We will continue to getting a non-JJM. How is the traction in non-JJM orders? That is good for the rest balance 40%? Sir, even AMRUT at the moment is a little slow. Okay. Slower than the pace that it had at the beginning. It is not poor in the sense that it is not on hold like it is with JJM. Irrigation has picked up quite well, and at the moment, the entire industry is largely operating on irrigation and a fair bit of AMRUT. But there's a traction in irrigation orders? Other irrigation- Good. Decent traction in irrigation piece. Okay. And sir, my next question is that Indus Water, whatever is there, government is moving very fast. That project DPR reports and everything has been called. So can that be a big opportunity for us? I'm sorry. You weren't very clear. Which water? Indus Water Treaty, which also has cracked. I think government is moving fast. They have called for a DPR and all. In fact, the next six months, they will be starting allocating orders. Whether that is a good opportunity for us, big opportunity for us? Sir, it will be a good opportunity, no doubt. The river link project as a whole, this will be a similar natured project as the river link. It will be a diversion of huge volumes of water. Okay. This, along with the river link, seems like a good opportunity. Of course, the initial movement, divergence of the route is done through canal. Okay. All the distributaries of that which go into irrigation and drinking water will use pipe. With a slight delay, there will be good opportunity coming up from that. The government was saying these are the next eight areas which have been cleared. That also is a good area of opportunity for irrigation if the work starts there? That actually is something that is going to probably fructify even before the river link. River linking. Okay. Third, sir, our payments also got struck with the EPC contractors? A little bit, sir. There is a slight increase, although we've been very disciplined about it, so it's not shot up too much. There have been delays through the EPC contractors. A couple of major delays had happened with the government departments, but that is slowly clearing up now. No, sir. What I have heard from the other players is there are a lot of orders pending in the system, old orders, not the new. The payment for that has not been released, so people are going slow on that order. As I was mentioning earlier in this call, there is no dearth of order. Okay. It is the dearth of dispatchability of that order because of the stoppage of the fund. Okay. So any particular reason for stoppage of funds? Because this year also, government has spent only 4% of the allocated in the budget. Sir- Any particular reason or They want to try and understand why there are certain delays and why there are certain complaints and reports that have gone to them, which are negative in nature. It is like a check-mark mechanism, sir. They are trying to course-correct before it gets too late. Okay. There is a temporary slowdown or temporary shutdown for that reason. And sir, one question. Whether a lot of hydroelectricity projects will come in Brahmaputra, and that visit, that also are opportunities for us? I am sorry, sir. Many what projects? Lot of hydroelectricity projects will be also coming in. Sorry. Sir, that will give a slight push to our pipe business, but it will give a very good push to our valve business. Sir, now there are two bookkeeping questions. Whether this quarter, the acquisition which we have done, it includes the revenue for that Italian acquisition? Two months revenue. Huh? Two months revenue. That is how much, sir? That is 55. 55. 55 crores. Okay. At that EBITDA level, we are breaking even, no? We are making money? No, I think more than breakeven. More than breakeven. So that business has the opportunity to scale up? Definitely, yes. Okay. Last question. When you said INR 60 crore was the other income extra for the entry tax, you said below, what is the net effect? I want to understand the net effect on other income. Basically, INR 60 crore is INR 4 crore is on account of entry tax. Okay. There was some income on account of FD interest. Okay. On the fund we got from the railway department. Okay We got the income on the FD. And some INR 6 crore refund we got from the department, that is also included there. Okay. So the net effect is how much? That is what I want to know. Net effect is around INR 80 crore, INR 85 crore. INR 85 crore is extra other income. Yes. Okay. No, the interest on FD is not extra other income. It is a regular income since last two years. Understood. If you take that out- Sorry to interrupt, Rajesh sir. May we request you to- Sir, that is the last question on fund bookkeeping, on that. Sir, there are several other participants. Okay. Thank you. Thank you so much, sir. Our next question comes from the line of Saket Kapoor from Kapoor & Company. Please go ahead. Namaskar, sir. Thank you for the opportunity. Hope I am audible, sir. Yeah. Yeah. Sir, on the receivable front, are we also facing any issue or those payment are in line with the deliveries that have been done as on date? Sir, there is no issue in regard to the realization of the receivables. There are certain delays that are there, but they are all backed financially by BGs, LCs, et cetera. Our clean credit exposure is less than 1%. So that is practically nothing. What should be that amount, sir, where we have this underlying BG and all, how much should be the receivable? Almost 100%. 99 point something percent of our receivable today is against BG or LC. Okay. Sir, any update on the coal compensation part? I think sir lastly, there was one asset that was valued. Any follow-up on the same? Sir, what's currently the roadmap for the same? Sir, there are some clarities that are being requested for by the allottee, JSW. We've submitted our answers against all those clarities. We are hopeful that within this financial year, we'll get some, at least on the asset which has been valued, at least we should see further work. Pending revaluation and how are things progressing there? That will happen one after the other. They have cleared a very big chunk. Okay. Out of our INR 1,200 crore, I think we had received around INR 80 something earlier, and this is around INR 500. So half of it has been cleared up. Now, once this is cleared, then they will start working on the other aspects, and then we will see where we get to. Okay. Sir, in the cash flow, we have made a payment of INR 120 for business acquisition. So this is pertaining to this valve company only, that we have said? Yes, please. Okay. When will we start seeing the revenue? How have we outlined the business that we are envisaging going ahead for the remaining part of the year? Sir, since it has only been two months since we have merged and it is a same industry but very different product. This particular year, we will probably see a similar performance as it had last financial year, which is approximately EUR 37 million-EUR 38 million revenue with profit margins of around 8%-10%. I am talking about profit margin, not EBITDA. EBITDA is around 15%-16%. Then starting next year, once the integration process is done, we should see good jumps. What those jumps will be, sir, I will only be able to tell you maybe in the next financial year itself, maybe quarter four. Okay. Sir, total cost of acquisition is INR 120 only. We have paid the entire money. Yes. Okay. Sir, that is all, sir. Not much to discuss. Thank you. Everything been answered, sir. Thank you, sir, and all the best, sir. Thank you. Thank you very much. Thank you. Participants, you may press star and then one to ask a question. Our next question comes from the line of Rajesh Bhandari from Nakoda Engineers. Please go ahead. Good afternoon, sir. Good afternoon. Yeah. One of the question here, you have said that this year it will be 5.5 lakh tons per annum, and next year it will go to around 8.5 lakh tons. What makes you so confident, sir, that it will go to 8.5 lakh tons? Sir, next year, the demand situation, the current stop that has happened to the funding will open up, and we are prepared to ramp up production from the capacity perspective. Yes. Both these scenarios put together simply would lead to us feeling that we will do this. Yes. Meaning we will be able to even supply and realize the money, 8.5 lakh tons. There is a quarter delay usually that- Yes. Realization, yes, I know, quarter delay. Sir, this valves revenue per year, what is the revenue expected? Sir, last year, the company did a revenue of around 36, 37 million euros, which is around 350 crores. This year, we might see a 10% growth on that. Starting next year, from our current estimates, there should be decent growth. To give you an exact number, sir, it will be incorrect at the moment because we have only started integrating. Yes. If you allow us a little more time, we will be able to give you more concrete numbers as per our plans for valves. Yes. So this INR 350 crore you are saying, sir, that is for India as well as outside? Sir, this INR 350 is largely outside. Right now, the company's presence in India is negligible. Okay. By when can we expect that they will become active in India as well? Sir, next year. Right now, manufacturing setup and all the approvals and everything is already in process. Yes. From next financial year, we will start selling in India, Middle East, and a little bit in Southeast Asia as well. These are the three main markets which we will open up for the TIS valve business. At the moment, they largely operate within Europe. And next 5 to 7 years, what is the future prospect, sir? For this product? No, not for this product only. This product as well as our DI pipes. Sir, we are fairly certain that going forward, growth in valves, our focus towards improving efficiencies and operating at full capacity. The package that we will offer to our customers having valves, fittings, and pipes, there is definitely a USP in that. Yes. You will have an edge over others, no doubt about it. We are already starting to see sentimentally at least that play a little bit in Europe. We participated in multiple water expos and exhibitions. Yes. The feedback from the customers are very positive. They already have a good impression of Electrosteel. Seeing that we will be able to cater to their need for valves, which is a very critical aspect. Yes. In terms of value terms, it is small, but in terms of criticality, it is very high. Yes, correct, sir. All products coming from the same supplier gives them a lot of confidence, and we are confident that we can use this to gain an edge over our competition. Yes, that is surely going to happen because not any party in India, at least, has DI pipe and also valves. Right, sir. Sir, this INR 150 crore profit quarterly, by when will you be able to reach, sir? Sorry, sir, 150? Our normal INR 150 crore quarterly profit, which used to be net profit, has now come down a lot. So by when will you be able to reach this level, sir? Sir, I think Q2 next FY, we should start seeing numbers close to that. Okay. You mean to say Q2 around FY 2027? Yes. Yes. There is one last question, sir. Yes, tell me, sir. You will see a pickup from Q1, then- I know, yes. Sir, this BlackRock, still they are the shareholders? Yes, they are. Okay. With the same level? Almost same level. Okay, sir. Thank you, sir. Thank you very much. Thank you. Our next question comes from the line of Vipul Kumar A Shah from Sumangal Investments. Please go ahead. Hi. Thanks for the opportunity. My question pertains to this coal block compensation. There is a figure of INR 498 crores mentioned, which has been approved. When is it likely to flow? Is this the final verdict, or are we going to appeal this? Sir, this is the valuation for one particular asset which had not been valued so far. It is close to our estimate as well. It would be incorrect for me to give any sort of deduction on when we can realize it, but there is active persuasion from the side of the new allottee and also the ministry. Hopefully within this financial year we should see this work out. But if this is not challenged in the higher court, then naturally that money should accrue in reasonable time. Is that understanding correct, sir? Yes, please. You said this is valuation of one asset. So how many more assets are remaining to be valued, sir? There are two more big assets and then a total of smaller assets. So two more are to be valued, or total two are there and one is valued? Two more are to be valued. Okay. And sir, my last question regards your capacity. On your presentation slide, why it is mentioned that your capacity is 10 lakh 11,000 and whereas somewhere in the call you mentioned that our capacity is 8 lakh 50,000. So what I'm missing is? That is an accumulation. Sorry, sir. That is an accumulation of all our products. Okay. This is the DI pipes, then we have another 50,000 tons of CI pipes, then we have 25,000 tons of DI fittings. Okay. These are- 850 is only for DI, right? 850 is only for DI, sir. Right now, if we split our revenue between different products, what should be the percentages, sir, roughly? Sir, DI pipe will be the highest chunk, which will be around 75%. Eighty-five? 75%-80% will be DI pipes. Okay. DI fittings would be around 5%. CI pipes also 5%. These are the main items. Okay, sir. Thank you and all the best. Thank you. Thank you. A reminder to all the participants, you may press star and then one to ask a question. Our next follow-up question comes from the line of Rudraksh Raheja from ithought Financial Consulting. Please go ahead. Okay. Yeah. Thank you for the opportunity, sir. Sir, you mentioned that government is course correcting because of lot of complaints and everything. Is there any pattern like, are these complaints pertaining to a specific product segment or some region is affected or some kind of players or products are affected? Just to get a sense on what kind of problem we are looking at. Sorry. There is no pattern per se. There are three main, I would say, topics of issues. One is the incorrect physical implementation of the pipelines, financial mismanagement, and quality of water problems. So these are largely what you see as the topics of discussion. There is no specific product or specific contractor or specific state department issue per se. There are talks about U.P. having certain irregularities, but across the board, you are seeing that actually. Got it, sir. Sir, you mentioned something about that we are holding off currently on the 1 lakh ton expansion in the DI pipes. As and when we decide that we are going for it, how much time would it take to install that capacity? I think it will take around 6 to 8 months for the capacity to get added, another 3, 4 months. You can say 1 year or so. And the amount of CapEx that would be required for this? Around 60 crores. Understood, sir. Sir, a broad idea on our international business. We have acquired this plant in Italy. Do we have a number in our mind that we want to achieve? I am not talking about next year. Let us say in 3-5 years, some kind of target with respect to our international revenues that we have, or the share of international revenues in our broader revenue mix, something along those lines that we are thinking. I think, sir, I will be equipped to answer that question to you by the end of this financial year when we are doubly, triply certain about the potentials of the market. Today, any number I will give you will be based on an educated guess and without backup of a floor plan. So it will not be correct for me to share that with you. Got it, sir. Fair enough. When we say that acquiring this valves manufacturing plant, we can integrate that what we are supplying in India, like with DI pipes, we can add valves and all of that. Does that mean that valves would be manufactured in Italy? We will take that from that plant and then sell in India, or will we install a new plant in India for manufacturing that? We are going to install a new plant in India as well. That plant will continue to cater largely to that geography itself. Some of the products that they make are very high value, low volume products and very specialized. So that today in India is imported entirely. So for that product, we continue to purchase from Italy and sell in India. But apart from that, the other day-to-day products that they are making, we will start manufacturing in India. In fact, we would like to manufacture in India and export them. Got it, sir. Just the last question, if I can squeeze in. You said that last year this Italian business did around INR 350 crores of revenues. What was the utilization of the plant at those levels? Sir, I would say around 70%. 70%-75%. Got it, sir. Thank you so much for your detailed answers. Thank you. Our next question comes from the line of Hari Kumar S, an investor. Please go ahead. Yeah. Audible, sir? Yeah. Okay. Thanks for the opportunity, sir. Only one question. Regarding the international market, is there a total lack of demand or you are very highly competitive because we are not getting more orders, which we were getting earlier? That's all, sir. Thank you. Sorry, sir, your question was not very clear. Regarding the international market? Is there sort of lack of demand or there is more competitive intensity because we are not getting more export orders, which we were getting earlier? You mean our interest in the international market? Yes, sir. Yes, sir. Regarding the DI pipes. Sir, we have always been a company which has hedged its business geographically across the board. Historically, also, Electrosteel has exported more than what the rest of the industry as a whole exports, and it remains so. A slowdown in the domestic market has allowed us to get a little more aggressive and soften the blow of the slowdown over here, I would say. So that is what it is. Yeah, that's the point I was trying to get. Okay, sir. Thank you very much. Thank you. Thank you. Ladies and gentlemen, we will take that as our last question for today. I now hand the conference over to the management from Electrosteel Castings Limited for closing comments. Thank you everyone for joining us today and your continued trust in our company. We remain committed to driving sustainable growth, strengthening our balance sheet, and creating long-term value for all our shareholders. We appreciate your support and look forward to updating you on our progress in the coming quarters. Good day. Thank you, everybody. Thank you. Thank you. On behalf of Electrosteel Castings Limited, that concludes this conference. Thank you for joining us, and you may now disconnect your lines.