Q3 20/21

Feb 9, 2021

Ladies and gentlemen, good morning, and welcome to the Q3 FY 'twenty one Earnings Conference Call of Alcon Capital Oil 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. Please note that this conference is being recorded. I now hand the conference over to mister Mayank Vaswani from CBR India. Thank you, and over to you, sir. Thank you, Luzanne. Good day, everyone, and thank you for joining us on the q three and nine months of f five twenty one earnings conference call for Alicon Castillo Limited. We have with us on the call today mister Vinod Gupta, group CFO, mister Shekhar Javed, COO and mister Rajiv Gupta, head of domestic business at Alicon Castillo Limited. Mister Vinod Gupta will cover the financial performance, following which mister Javed will walk us through operating highlights for the quarter and developments in the EV space and the export markets. Mister Rajiv Gupta will then provide insights on initiatives towards the domestic markets, following which you will have the forum open for a q and a session. Before we begin, I would like to point out that some of the statements made in today's call may be forward looking in nature, and a disclaimer to this effect has been included in the earnings presentation and our results documents that have been shared with all of you earlier. I would now like to hand over the floor to mister Duval Gupta for his opening remarks. Over to you, sir. Good morning, everyone, and thank you for taking the time to join our call. I'm pleased to inform you that we have delivered a solid performance during the quarter on the back of the recovery in economic activity and improving trend across both domestic and export markets. On a consolidated basis, total revenue from operations was INR 269.54 crores in Q3 FY 'twenty one compared to INR 227.75 crores in Q3 FY 'twenty, growing by 18% on a year on year basis. On a sequential quarter basis, revenue were higher by 31%. We witnessed improved traction with several OEMs in the domestic market, which led to higher volumes. As a result, domestic revenue during q three FY twenty one grew by 33% year on year, 50% on quarter on quarter basis. Following the resumption of movement of goods across international borders, export volumes have also reached up this quarter as we steadily recover towards pre COVID levels. The revenue mix between domestic and global business stood at 7921% this quarter compared to 7822% in quarter two. The revenue mix between the auto division and non auto divisions stood at 8911%. While we all are well aware of the sustained recovery in auto volumes, we are pleased to share that even the non auto vertical is demonstrating recovery. Coming to profitability, the EBITDA for the quarter under review was at rupee 33.65 crores compared to 32.668 crores, improving by 3% on year on year basis. The EBITDA grew 26% on a sequential quarter basis. On a year on year basis, the EBITDA margins was at 12.5% from 14.3% in Q3 FY 'twenty. We are steadily rebuilding our margin profile after the impact of the pandemic and the resultant lockdown. In q two, we reported an EBITDA margin of 13%, and this was slightly moderate this quarter to 12.5% due to the change in the sales mix. We have implemented cost control measures across beginning margins back towards the record levels. Profit after tax for q three FY twenty one stood at rupees $11.45 as against 8.44 crore in q three FY twenty, up by 36% and PAT margins stood at 4.2%. So I speak word on recent developments. The union budget announced last week has many positive announcements and is very encouraging of manufacturing as one of the main pillars towards reviewing the Indian economy. The streamlining of the production link incentive PLI scheme is favorable for manufacturers of the engineering engineered components like us. The vacuum scrap policy which incentive incentive incentivize replacements should provide a clip in demand for the auto industry. In addition, measures towards enhancing liquidity income system, building rail and road infrastructure and increasing expense to what health care and farm sector significantly contribute to a both energy environment for growth. The board in its meeting on December 2 approved a proposal to raise funds up to rupees hundred crores for equity. This is an energy resolution allowing us to keep an keep the option open to raise growth capital, which will provide the financial must muscle to address our medium to long term plan. We are carefully monitoring the environment and plans for our customers to identify appropriate time to implement our growth plans. Overall, we have reported a strong performance during the quarter. We are confident that with further unlocking in the domestic and export market and the improving macro environment, we will build on this momentum in the quarters ahead. On a note, I would like now to hand over to mister Shikhar Dhawi. Thank you very much. Greetings to all. I trust all of you are well and staying safe. Following an unprecedented first half of the fiscal month by the lockdown, production constraints, and the supply chain restrictions, the third quarter witnessed near normal operations. Several high frequency indicators such as power demand, rail freight, EV deals, GST collection and toll collections are demonstrated or V shaped recovery, pointing towards a fairly comprehensive return of economic activity. Within the auto sector, the domestic market demonstrated resilience in the third quarter with almost all major OEMs reporting V shaped recovery in volumes. What initially seemed to be a spike due to combination of a pent up demand and the instances themselves has turned out to be a more comprehensive recovery predicted on a positive demand trend in rural and semi urban markets. Lower interest rates on the vehicle growth and the heightened consumer preference for the personal mobility. In demand despite lockdown constraints in some part of the Europe during the quarter due to concerns surrounding the second wave. We saw sustained growth in volumes from our equipment subsidy and supply components and parts from this facility to many global clients during the quarter. Exports, including sales of equipment subsidy, contributed to about 21% of our total revenue in quarter three financial year twenty twenty one. In quarter three financial year '20 '1, we have added 16 new parts from our export customers like Malware and Tata Ethicon. So all nine months in nine months for quarter nine months for the year '21, we added 33 new parts with eight export customers. Now a quick quick word on our new business. Our engagement with the global OEMs in The US and European market for our EV products portfolio remains strong, and we are continuously building a healthy reference best. In the international markets, we are seeing significant measures being announced by various economies towards decarbonizing the road transport and boosting the uses of green energy vehicles, which includes electric vehicles. Accordingly, we are accessing customers enhancing their focus on green energy models such as electric and hybrid vehicles. Further on, the auto industry is seeing increased impetus towards adoption of a clean and green mobility tool. ETIO, the policy take time of the government of India, is targeting 70% of all commercial car sales and 30% of our private car sales in India to be electric by 02/1930. During the quarter, we added eight new parts from the customer, Dana TM4 from ESS. Looking ahead, we are actively pursuing growth across our business segments and we are increasingly growing our presence in deep regions through our unique one subsidiary. We are also marking a steady and gradual progress in finalizing new business wins with existing and new customers in the export markets. With the COVID-nineteen recognition gaining momentum across the globe, we expect that demand and the consumption trends will only strengthen in the months ahead. On this note, I would like to hand it over to Mr. Raji Gupta, on a month on month basis for the first straight month as of December. Tractor volumes have surprised on the upside with large OEMs reporting higher volumes. Volumes of commercial vehicles will not have volume as we may witness accelerated decision making in that vertical sparked by initial state of the latest package policy. Now we've done better is the continued forming up of fuel prices. Most OEMs are now operating at near normal utilization levels, and a parameter of increased confidence in the industry is a rapid increase in the prices to pass on the raw material inflation. Now coming to our performance. The overall positive momentum in the domestic auto industry has had a favorable impact on the domestic volume uptake. Total contribution from our domestic segment stood at 79% in quarter three FY 'twenty one. During the quarter, we have added 11 new cars in the domestic segment from three customers, Dana, Eaton and Garrett. Of which, Eaton and Garrett was of the IC segment, and Dana was from EV. Overall, in in nine months cumulative FY 'twenty one, there are 26 parts in 11 with 11 domestic customers. So on the on the whole, we have reported an encouraging growth in the domestic auto segment during the quarter led by improving demand on the account of pent up sales, such as push and higher preference towards personal mobility. As we look ahead, the domestic operating environment is gradually stabilizing, and there are positive indicators that a demand will only strengthen from here on. We are seeing a good level of inquiries and bookings in the market and are hopeful for improving macros will support will further support this momentum. Now I request Mr. Vimal Gupta to share his remarks. So thank you, Rajiv. So today, I would like to introduce our managing director of hundred the subsidiary company in Europe, mister Andrea Zain. He's he's also in the call. So he also looks after the our global business. So, Andrea? So thanks for joining the call today. Oh, sorry. And speaking, sir, for a moment. Excuse me, sir. We lost the initial audio from your line. Yeah. So may you please repeat? Yes. So also thanks for joining the call today, and many greetings from Austria's side. And thanks to Alikontin for the explanation. Many thanks. Perfect. Thank you, Andres. So so now call is open for question and answer. Thank you. Ladies and gentlemen, we will now begin with the question and answer session. Anyone wishing to ask a question, please press star one on your touch tone telephone. If you wish to remove yourself in the question queue, you may press and 2. Participants requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question gets assembled. The first question is from the line of Yastavedi, an individual investor. Please go ahead. Yes. Hi, sir. Congratulations on a good set of numbers, and I hope all of you are well at Alicon. So I just have two questions. Most of them are answered, sir. The first one is the margin outlook going forward because our current quarter's margin was down on a year on year basis. And in addition to that, only the impact of what kind of an expected impact of commodity inflation do you expect it to be on the margin? And the next next one is how are we doing on the execution plan for the orders which we have received in the last one, one and a half years? Thank you. So thank you. Thank you, Yas, for the question. So firstly, that on the margin side, I just explained one is that to your about the commodity. So commodity really is the raw material of the ammonium we are having. So that is completely part of to the customers. So for that, there is no impact on the margins of Elecon. So there is we have a system of settlements with all customers. So that is one side. Maybe some small impacts of the other commodities, like the fuel, energy, or some other things. So that is also we always keep on renegotiating our prices with the customer. So that is an ongoing process that we have to follow. And on the other side, for the quarterly margins, what you're talking about, there was a little bit impact that come up because in the earlier calls, we were explaining our cost reduction measures continuously we were having, and that is it is in continuation, and we are doing that. But on the other side, like you know that in the long time period, there was a lot of migration happened of the people. Those were working in our operations on the Top Floor. So we have brought back all those people, but there is a change in the people. And this is to bridge a little bit tough working condition because it's a foundry. So and after joining, then people there was a lot of movement of the people who are there. So when new people joined, then, you know, that when some skilled people were not there and new people, it it takes time to learn. So that learning cost that we had in that time due to the delivery impact the on our operating cost also. And you see that in this quarter, it is some that we were expecting on the employee cost side that was a little bit on the higher side. But now it is almost out. It is under control. So things, because in the last quarter, we have improved on that side, and now, things have stabilized. And in the coming quarters, we can see the improvement in the budget, and we will back on our earlier one and maybe that are you in the previous quarter, we explaining that the we will continue on our growth journey on that side. And for all of that, I will ask mister. Good morning, Josh. Good morning. The update on the orders what we received and which were declared in the last one and a half years. The orders what we received from and we are online. The sample submission has took place as per the requirement of the customer. Validation has been completed, and we are on the for the ramp up of it from the second half of this year. So that is online right now. There is no issue on that. And whatever the orders recently we received, all the groundwork is under process, and we are quite confident to meet the timelines we have been discussing with the customer. And those will be in a ramp up transition by 2223 as discussed in last meeting. Okay, sir. Thank you so much. All the best. Thank you. Thank you. A reminder to the participants, anyone wishing to ask a question, may please press and 1. The next question is from the line of Raghunandan Inan from MK Global. Please go ahead. Thank you, sir, for the opportunity and for the detailed commentary and investor Congratulations on stellar numbers. Firstly, for Mr. Dravid and Mr. Andrea, EVs are witnessing strong acceptance in global markets as you alluded to in your comments. Can you indicate opportunity for Relicon in terms of existing size of business and potential opportunity? Existing, you indicated 3%. If you can give some color on how things might pan out in future. Also, you had indicated complex products such as housing and with thermal cooling. So directionally, if you can indicate whether margins would be higher than the existing business, that will be helpful. Thanks, Prahladan. Regarding EV, basically, we are steadily moving towards as we expressed in last meeting also. Right now, whatever the orders for the bank in this sector, That is specifically from Danfoss, then which is from Danahru. And you know the office, which is in India, that that has started going up. If you recently, they have put up their plant of 200,000 vehicles to the. So they have ramped up their production to around 33 cities now through the. Three to three to 4% in this sector coming down. Right now, we have developed more than 48 components. And for the 127 components, we are working on, which will be coming near future. We will close it, and we that will be under development. So we are looking at the strategy that by year 2526, we should end up with our EV penetration within our business plan for around 9% to 10% of our total sales of the. So we are so total, right now, whatever the developments are going on, so we are adding new components from the operation. Recently, we have got Garrett. They have come up with their e mobility sector coming into. We have backed an order for e sector from e sector from Eaton. We are working on that. So there are recently, in Indian OEM, Mahindra, we have developed the the housing, which is for first Indian OEM domestic for and which will go in ramp up by second half of this year. Also from, we have item order. We have got a repeat order for some new developments from Wonderful, sir. On the on expanding global business, if you can highlight efforts relating to strengthening the global marketing team and, you know, like how having a Europe presence is helping in terms of gaining market share with global customers? Yes. Basically, you know that you are aware that NCLEX Japan is our partners, and they are mentors in this business. They are helping us out to reach global customers with their influence. Also, we declared last time that we appointed a marketing representative named Safari in Europe, and they will be representing Alcon in the European market. With their help, we could able to back order from PSA cylinder head business for India as well as now we are working with them to have a global business from PSA to be hired on the board. So the third one for The U. S. Market, we operated last year, again, our representative, that is TBS. Month or they are having. And we are seeing lot of new interruptions and inquiries when RFQs are getting generated via DBS, and we are working on that. Definitely, this will enhance us to a sizable amount of business, global business. So this is again in line with our global policy and expanding our global we are trying to assess North America, Mexico and Germany also have. TDS has got good connectivity in this market. Also, Korea, we are trying to build with TDS team. So we are expanding with these teams allocated globally. We are trying to expand our global presence and this is in line with our global business entry strategy. Thank you, sir. That's good to hear. Last quarter, that is in Q2 con call, you had indicated lifetime orders of INR 2,800 odd crores. Just wanted to get an update on this. Would that order book have increased given the new addition of orders which you indicated? Basically, about that, right now, around 250 crores of new orders have been in the third quarter. We make it to around 2,000 crores total lifetime orders comprising to the average yearly business Thank you, sir. This is very helpful. For Vimal, sir, on nine month basis, gross margin has improved. In Q3, gross margin is slightly lower, and you alluded to sales mix in your commentary. Can you please provide some details? One is that sales mix because there are some complicated parts because we have started. That that is one part. The process is very positive because now new part, whatever we are adding, that's the machine part maybe in the other course I'm explaining. But the changeover is happening from the costing part to the completely or fully machine parts. That is the increase in the processes. Secondly, I was explaining with the question from Suryash that explained about the some impacts in the quarter due to this migration of the labor. So that we brought back, and then that has caused a little bit in the quarter that has impacted on the margin side. So the cost of the new people and then the process because their training cost and then the efficiencies that we can see immediately when they start working on the shop floor. So that has impacted a little bit on the margin side. So that is now in the quarter three digit deadline. So we can see that the things are normal in the coming quarters. Got it, sir. Sir, working capital reduction has been a focus area and like that BS IV, BS VI changeover and all this COVID pandemic related issues had led to some increase in working capital in the, say, beginning of the year. So just wanted to understand how has been the efforts on reduction of working capital, if you can give some qualitative color on that. This is quite right because you know that the impact when lockdown was there, so there was a pressure on the cash flows. And you know also that the kind of the quarter one has impacted on the cash flows of the company. But I am happy to say that there is we don't see any increase in the on the debt side during nine months at the end of the nine months. And on the front of the reduction in the working capital, that is continuous with this process is going on. And maybe in the when you see the financial for the year of March '1, there you will find that a sizable reduction on that side. So the process is on because we are more focused on the receivable side and that how to increase that how to reduce our working capital cycle. Thank you, sir. This is very helpful. I'll come back in the queue for more questions. Thank you. We'll move on to the next question. That is from the line of Vibha Bhattra from Fair Connect. Please go ahead. Yes. Thanks for taking my question. My question is on the equity raise that you proposed. So does one expect significant CapEx in the company? And, you know, when you undertake any significant CapEx, what kind of return on capital employed do you target? And also a request if in your presentation, you could add apart from the operating margins, line on return on capital employed and return on equity, and also if possible give outlook from this? No. On the equity they say that it is in process and activities are going on because, you know, that's why when we go for the QIP, a lot of the compliance part is there. So that is on. And maybe we are expecting the again, in the month of March. So it depends on the completion of the processes. So that time, we will take it all. Okay. So What is the purpose? Is it a significant CapEx that you plan to? I'm coming to that, the purpose. Okay. Correct. I'll just explain my cash flows for the current year. Generally, you see that maybe in both in the history of Aligon. So when CapEx is up there, so maximum part comes through our internal approvals. So it is a continuous requirement. And then we are talking about the new orders and the growth plans are there. So continuous requirement of the CapEx is there. So to fund that, so this time, there will be a shortfall from one is on the part of the internal approvals. And in the coming year, then because of a sudden jump in the volumes will have come in the coming year. So for that, we have to put up the specific capacities for those customers for those products. So major in part will go into the CapEx side of this equity. Okay. And return on capital employed, what is your target when you make these project plans? What is your targeted return on capital employed? I think it is a forward looking statement. So at this moment, so I cannot give these figures. But we can see because all the activities because what we are doing, that is more focused on both sides only. But what is your threshold level of return when you make these plans in undergoing the CapEx? Obviously, there will be a threshold return on capital that the board would define. What is your threshold return on capital employed? That's what I'm saying that you will see the improvement on that. Right? There is a good improvement you will see in this. Sure. Okay. In in the presentation, if you can include a line, it will be really helpful. Okay. That's it. That's why I Thank you. Thank you, and all the best. Thank you. We'll move on to the next question. That is from the line of Apurva Mehta from EM Investments. Please go ahead. Hi, sir. Congrats for a great set of numbers. Just wanted to know know the visibility for next next year. What kind of visibility we have on the equipment and on moving the equipment can provide on the domestic side. Looking at the present scenario domestically, there is a lot of right now the moment initiative, whatever is generated. But it will be too early because the market is so dynamic right now, and it is difficult to predict for the next quarters. So we are we will keep, wait, and watch, and we will we will keep our watch close watch on this. Regarding this whatever we are talking of next year, to give some focus on the global business and the whole global scenario to answer your question. Andrea? Yes. I'm I'm there. So you got the question. What is for the next year? That is 2122. Right. So for the global business side, at the moment, there's a lot of new potential customers in coordination to get new business onboard, especially in the EV market on which we are seeing huge potentials for Alicon on the on the global side. We are going under discussion with new techniques like for motor housings to implement steel parts to convert aluminum housings into light white parts and beam wall castings on such projects. We are working, for example, with Bosch in Germany. And for the customers, we are doing these tiles with them continuously in order to bring new projects on the table and the same for battery housings with integrated cooling systems in order to optimize the thermal cooling. So on such kind of new innovations, we are working on the global business side in order to prepare for our future into getting business on board. Just to, you know, you have to to the perspective, you know, we in March 2019, we were at, you know, almost 100 crores. So is it possible to outpace that 1,200 crores of turnover next year? And by what what kind of visibility we have? It will be too early to comment on. We have our internal plans, but it is too early to comment on any precise figures to be discussed. I think we should wait. We have waited for one year. We should wait for one more quarter so that this this we can come with the complete figures. And currently, we have export of around 20% currently. And when this needle, you know, shifting the next year when we can see this needle to shift towards more of, you know, like, 25% of the terminal coming from the store. And the new, you know, on the new order which which we are getting, are they are replacement orders or they are new to those parts which are fresh orders and, you know, new parts from the current customer? Only one component that is collection from Daimler, which has been replaced by the new model of that, which has been a split up model. All other orders what we got it, Mister Mehta, you done with the question? Yeah. Yeah. Thanks. Thanks. Yeah. Thank you. The next question is from the line of Yashpu Devi, an individual investor. Please go ahead. Yes. Hi, sir. Thank you for the opportunity again. I just wanted to know what kind of an improvement in, say, the content for the vehicle and the realizations do we see when we move from our conventional IP vehicles to electric vehicle? Thank you. Yes. Basically, if you see, we have discussed events in last meetings also. Going forward from IC technology to the EV technology, So these things are what we are targeting is now. And we are anticipating that we are converting it to IC. We will have from IC to EV. There will be around two to 2.5 fold increase whenever it will come, which will be an average of 17 to 18 kg per vehicle. We will get an opportunity per vehicle of the radio castings. In four meter also, we are seeing sometimes around aluminum requirement we are anticipating, converting from IC engine to EV mobility technology. Okay, sir. Got it. Thank you. Thank you. The next question is from the line of Diraja from Philip Capital. Please go ahead. Yeah. Good morning, sir, and thanks for the opportunity. So my question is pertaining to the order in which we have, you know, won in last maybe one one to one and a half years. So till date, our order book is around 3,000 crore, if I'm not wrong, sir. And maybe, you know, if we divide this by five years, so every year, we will be fetching around 600 per kind of a revenue run rate. So for executing this kind of an order, sir, what kind of keep it we would be requiring to exhibit this 3,000 crore kind of a revenue next five years? For this approximately, we will require around 230 to 280 crores in that range. 230 to 280 crores. Okay. So so so maybe for FY '21 and FY '22, sir, we have lined up around one forty five karat kind of a CapEx. Right? Yes. That's your plan. Yeah. Okay. So, incrementally, we would be requiring more $1.40 karat? Yes. Roughly. Roughly. Okay. And, sir, I believe all these new wins are of of, you know, higher margin. Right? This is under margin, which is from 20%. So these are on the same range, or this is much higher as compared to the current run rate, sir? At this moment, it is on the highest price. That much would be can spread it out once it goes into the ramp up. Career popularity will come into the picture. So it will be too early to comment on the advance figures. But yes, whatever we predicted of that definitely, we will feature the higher margin, which we expect from this new contract. Okay. And sir, what is the what is the current market share, you know, across two wheeler, three wheeler commercial vehicle right now? As far as two wheeler is concerned, we are around 39% share of business right now. Share of business. Okay. So do we supply any parts to the tractor industry? Because right now, you know, that the world tractor industry is doing substantially. So are we supplying any parts to them? Yes. We are supplying to three measures. We are supplying to, you know, CNH. We are supplying it to. We are supplying it to. And we are adding the growth of our business with these three customers as that sector is growing. Okay. Okay. And, sir, apart from this, we were also in talks with Deepak Chien. Yeah. That is that is for the electric batteries and motor motors because if I can get people with the final unit of suppliers of motors, automotive motors as well as the battery to the major OEMs throughout the globe. So we are proposing the aluminum casting, which is a base requirement of this to this its customers very touchy and. Okay. And sir, lastly, any CapEx required for the base business? Because this $2.80 crores would be for the incremental order win, but any CapEx required for the base business, which is there right now? That is this. You see, in our business, whatever the capacities we have generated, those capacities are basically common for all the requirements. All these CapEx, what we are talking about, the new compounds which are coming into. And mainly the shift of our business, if you see, we are more towards providing a solution to the customer. So we will be providing the customer a ready to use component with the value added services like machining, painting, and some some that comes into it. So for that, a very specific setup to very specific machines and very specific required. And this CapEx, we are intent to go into that. As such, based whatever we have got, already we are working on that, I think, I you know, speech you have already given that we are all cost control. In fact, very specifically, the existing whatever the access we have got, the rating of that access by introducing new technology, number of carriers per per die increasing to that cycle time directional policy things we are working on to generate the base capacity from the present one to a higher level of it. A small part of it will go to for the balancing of the capacity, but very small part of it will go for the base capacity increase. I think I'll ask a few questions. Yeah. And, sir, lastly, are we on track to achieve additional $3.30 koror kind of a revenue from the new business in FY '22, which you have guided earlier? Yes. We are we are we are very much confident about it. And in FY '23, it would be $5.20 koron. Right? FY? FY '23, it would be $5.20 crore. Alright. Yes. Roughly. Okay. Now the ramp up for for all these orders will start between '22 to '24. Okay. Okay. Okay. Got it, sir. Thank you so much. All the best, sir. Thank you. Thank you. We'll move we'll move on to the next question. That is from the line of Raghunandan Anil from MK Global. Please go ahead. Hi, sir. Raghu here again. To Shekhar, sir, sir, can you comment on how aluminum content per vehicle has been increasing due to premiumization? I mean to say, as the share of UEs increase in passenger vehicles and share of premium motorcycles increase in two wheelers, how is that leading to higher content per vehicle? Basically, if you see there are when the technology, the search and text text paper taking place right now from IT team towards the e mobility. There are two things coming in. Is that the light rating of a vehicle is very important, as I already expressed, for the performance of a battery and the size of the battery requirement for a higher out mileage with a given charging required. And this cost for the life saving of a vehicle is must. And for that, traditionally, the parts for all these vehicles, which were in the fabrication of steel or they are made of cast iron or a steel forging, it has become evident and so for OEMs from from the point of the to go for the low weight components or low weight of alloys. And that's but right now, the substituting is available in the. And, hence, if IC engine is not there, the other parts, like the parts of chassis, parts of the body, structural parts, which are required. And as I explained, if you take a case of a two meter, right now, our contribution in a present IC two meter chassis parts or the parts required for the suspension and parts required for the body. If it goes, minimum of 17 to 18 kg to the customers for converting their hybrid components to global components, having all the infrastructure at our end. And we are working on that related to our customers to increase our share of aluminum into the per vehicle. Also, in four vehicles, if you see, right now, our contribution is increasing in the strength of his business. And other than Renault, we have added Toyota and installed last year. We added PSA into it. So all these will increase our share of business in IT engine itself for the aluminum content. But if you convert this into EV also, the I'll just give an example. The normal EV vehicle, normal IC vehicle, four liter vehicle, weighs around 1,254 kgs, normal vehicle. If it goes the same vehicle goes to hybrid or EV, there is an increase of around 454 kg of a weight because of the battery load and the motors which are getting added and the transmission, which is getting added. So it has become mandatory to reduce that weight of two fifty four k g, which cost increases the cost of the vehicle. And looking at this, not many components came into and that is what our strategy offer we explained. We have changed our gearing to that, and we have shifted to the technology agnostic part. The part which will require irrespective of the technology disruption, whether it is IC engine, whether it is a EV, whether it is hybrid, by the way, Alicon is still available for their future growth business. Thank you. Thank you, sir, for the detailed explanation. My question was within passenger vehicles, say the when you are supplying to someone like a Toyota or generally to utility vehicles, the content per vehicle for a UV, would it be higher than that of hatchback? So in the the where I was coming from was that as the industry is shifting towards more and more utility vehicles, you know, that itself should lead to higher content per vehicle. Would that understanding be right? Up to 7%, yes. Got it, sir. And sir, like, the EV parts will be mostly machined parts? Yes. As a strategy, Right now, the easy part is the global business. Very few people in India right now making it because even in India, people are thinking of importing it. They are not making the complete set up in India at this moment. So our for a global business, Alicon has got a strategy to supply these components in fully machine condition so that the risk, whatever is there, as far as the quality of the part is concerned, that is that will be filtered at our our level only, and the only good parts will be sold to a global market. So from that strategy, will be fully machine confidence, and we are going with this at this moment also. Thank you, sir. Sir, non auto business has done well. The share has increased to 11%. Last year, it was 8% for the full year FY 2020. Can you indicate which of the subsegments are doing well? Attractors, you alluded to, is certainly doing well. Any other subsegments which are doing well? And here, the orders and the customers you have, if you can elaborate on that, that will be helpful. Basically, other than agriculture, is factor. We've seen the growth in the energy sector. As you know, there are not many projects, domestic as well as global, electric projects are coming. And where this new technology, that is gas field technology has come into picture. So we've seen the growth there with the existing components. And also the new business, what we are driving, that also is coming in the energy sector at this moment. Also, are seeing the growth in the defense sector, where because of efficiency, Indian government has recently, released the tender for the light weighting of the current times which are in the operation. And 28 times at this moment to be refurbished with an aluminum parts to look, lowering the weight of these tanks. And each tank requires 32 wheels. And Alicon is one of the only supplier for this to defend the best to low pressure die castors. And recently, we have got a balance order of around 900 mills to be supplied and got a tender of 3,890 mills to be supplied in next three years. Each mill weighs around 42 kilograms per mill. So we are seeing the growth there. And also new opportunities are emerging now. Recently, has been the changes which the plan which has been developed by each year for a passenger, which has been converted to a fighter plane. And for this, there are the new requirements that come from the defense for developing the landing gear. And this activity is at the premature stage right now, but Alipon has got an opportunity to participate for this development, converting presently whatever is in important. It's a complete import substitute. So they work this part for the landing gear, and Alicon is working on that. So these are the major two sectors we are seeing. There is increase. Also, you know that we are developed developed facilities ahead for the and for vehicle Tata. Again, that goes to the difference. And right now, looking at the market situation and the environmental situation around all the borders of India, the, what you call, army and defense Thank you, sir. Thank you so much and all the best. To Vimal, sir, sir, one basic question. Our gross block is roughly around INR700 crores and capacity is about 42,000 metric tons, which implies capacity cost per ton of somewhere around INR 160,000 per ton. So just wanted to understand at the current scenario, you know, what would be approximately the capacity cost for setting up, say, 1,000 metric tons of castings and machining, if that is possible? Thank you. It's a complicated question because there is a completely change in the processes that are going on because earlier CapEx, whatever the drop block, we were doing the business of the mainly on the costing. Now the processes, we are changing, shifting to more on the machining side. And now when we are going for the complex parts, so there is a requirement of some specific equipments that we have to do. So then there is a more value addition, not going for the, what we can say, the tonnage side. So tonnage and investment is a little bit difficult to match what we are seeing, what we had in the past and what we are planning in the future. So it's because the change completely change is coming up in the restructure. Got it. Got it, sir. Thank you, sir. Thank you so much. That's all from my side. Thank you. Ladies and gentlemen, that was the last question. I now hand the conference over to the management for their closing comments. Thank you. I hope we have been able to address your questions. Should you need any further clarifications or would like to know more about the company, please feel free to contact our team Thank you once again for taking the time to join us on this call. Thank you very much. Thank you. Ladies and gentlemen, on behalf of Alcon Casheloy Limited, that concludes this conference call. Thank you for joining us, and you may now disconnect your lines. Thank you.