Q3 25/26

Feb 6, 2026

Quarterly report

Summary

Q3 FY26 profitability improved as ferrochrome realizations rose, with EBITDA margin above 23%. Similar Q4 margins are expected if prices hold; capacity additions and higher ore-raising targets underpin FY27–FY28 growth.

Ladies and gentlemen, good day and welcome to the Indian Metals and Ferro Alloys Limited Q3 FY26 earnings call hosted by Veritas Reputation PR Private 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 once the presentation concludes. Should you need assistance during this conference call, please signal an operator by pressing star then zero on your touch-tone phone. Please note that this conference is being recorded. I would now like to hand the conference over to Mr. Abhishek Savant from Veritas Reputation. Thank you, and over to you, sir. Thank you, Alex. Good afternoon once again to everyone. On behalf of Indian Metals and Ferro Alloys Limited, I welcome you all to the Q3 FY26 earnings conference call. We appreciate your time and interest in joining us today to discuss the company's performance for the quarter ended December 31, 2025. Following the opening remarks by our management, we will open the floor for the Q&A session. Kindly keep your questions concise and relevant to allow broader participation. IMFA, India's leading fully integrated producer of ferroalloys, has demonstrated a significant improvement and resilience in Q3 FY26, despite the ongoing market challenges. This performance underscores the company's focus on operational excellence, disciplined execution, and long-term value creation. As you all know, the company has signed definite agreements to acquire Tata Steel Limited ferrochrome plant at Kalinganagar in Odisha, adding 99 MVA of furnace capacity for a base consideration of INR 610 crores. This acquisition will make India's largest ferrochrome manufacturer and the sixth largest globally, with a total capacity exceeding 0.5 million tons. The financial results are available on our website and have been filed with the stock exchanges for your reference. Before we begin, I would like to remind you that some of the statements made today in our discussion will be forward-looking in nature. These are based on the company's current expectations and are subject to various risks and uncertainties that could cause actual outcomes to differ materially. Joining us on the call today are Mr. Subhrakant Panda, Managing Director. Mr. Saunak Gupta, Chief Financial Officer. Mr. Binoy Agarwalla, Head of the Power Business Unit. Mr. Sandeep Narade, Head Mines Business Unit, and Mr. Suresh Babu, Head Ferro Alloys Business Unit. With that, I would like to hand over the call to Mr. Subhrakant Panda, our Managing Director, for the update on the overall performance. Over to you, sir. Thank you, Abhishek. At the outset, I would like to extend a warm welcome to all of you who have taken time out to join this call and to talk about IMFA's Q3 results. Let me start out with an opening statement, and then of course, we will move on to the Q&A section. First, a word about the performance. I am quite pleased to report to you about the robust set of numbers that we have reported for the third quarter of FY 2026, where our EBITDA and PAT numbers have gone up as we had indicated on account of the improvement in realizations in ferrochrome pricing. Of course, we have had a continued focus on productivity, on making sure that output is on track, a focus on efficiency. That is our various consumption norms. By and large, costing has been stable with a slight increase in the power generation cost on account of coal prices. Other than that, during the quarter under the review, the costing has remained stable and, taking the improvement in realization into account, we are reporting these numbers. I will just quickly go through the production and the sales numbers for Q3 FY 2026. Ferrochrome production during the quarter has been 67,196 tons. Power generation stands at 256.17 million units. Chrome ore raising during the quarter is 265,468 tons. If you look at sales of ferrochrome during the quarter, that stood at 64,802 tons. Ongoing expansion and acquisition plans. As far as the greenfield project at Kalinganagar is concerned or KNR1 as we refer to it, I am glad to report that the project is on track, and we expect to commission the first furnace in June 2026, and the second furnace shortly thereafter. It is at a very advanced stage and on track. Secondly, as far as the strategic acquisition is concerned, which we refer to as KNR2, we are in the process of obtaining various statutory and other government approvals, and we expect to close out the deal in the ongoing fourth quarter of FY 2026. More specifically, I think within the month of February itself. In as much as output from the acquisition is concerned, anything that we get in fourth quarter is going to be a little bit of a bonus. We really expect volumes to come in the true sense of the word, in first quarter of FY 2027. This is, of course, something which is going to be immediately value accretive. Finally, in as much as the ethanol project is concerned, that is again at a very advanced stage. We expect to commission it in March 2026, that is next month. There is a slight delay because we were initially targeting the second half of February. There has been a slight spillover on that, and we are expecting to commission it in March. This is something after the initial sort of stabilization activity, we expect it to start contributing to the top line starting April, so in FY 2027. That is where we stand. I would now like to move on to the Q&A section. We will do our best to answer your questions and provide further clarity and information about the company's operations. Thank you. Thank you. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on their touchtone telephone. 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. Also, please restrict yourselves to two questions. If you have any more questions, kindly rejoin the queue. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question comes from the line of Aashav Patel from Molecule Ventures PMS. Please go ahead. Thank you for the opportunity. Congratulations to the entire team for a great set of numbers. Special thanks to Mr. Panda for taking out the time and joining the con call. My first question is, sir, that globally realizations are very robust right now, and they have increased from the recent lows. Do you expect Q4, we will be able to see most of the benefit of increased realization? The second question follow up on that is that the demand buoyancy, how you are seeing at this point in time? Thank you, Aashav. Pleasure to be on the call to interact with you and other investors and analysts who have taken the time out. First, a word about realizations. As we had indicated in the last investor call, we were expecting a noticeable jump in realizations from Q2 to Q3. That has indeed translated through, and our EBITDA margins are a little above 23% in Q3. Now, as far as Q4 is concerned, there was a slight dip in prices, but now they have again moved back up. So domestic prices are roughly in the INR 1.18 lakh to INR 1.20 lakh a ton mark, and Chinese prices are around $0.96 to $0.97. We expect these prices to continue during the ongoing quarter, barring any exceptional situations which I don't foresee at this point in time to be very clear. And if so, we will certainly benefit from these realizations. Secondly, as far as demand is concerned, we have always been in a slightly different position to many of our peers, where we believe in long-term contracts and offtake arrangements where pricing is decided every month or every quarter, depending upon the particular customer. What that basically means is that at least offtake is assured. We do not really have spot sales, if I can mention it in that manner. But demand in general is buoyed by the fact that stainless steel has grown, even though it is in low single digits, around 2%-3%, but stainless steel output has increased. Correspondingly, there has been a sort of constraint in ferrochrome production with South Africa bringing down its output sharply. Non-integrated producers in India have also been affected. So basically, we do not see any issue in terms of placing our current capacity as well as the expanded capacity which is coming online. As I said, in the ongoing quarter, we see these realizations holding. As of now, the expectations is that it will transmit through into the first quarter of FY 2027 as well. Because that is where South Africa, in particular, has their winter tariffs and all that. Of course, I know that there is a lot of chatter around the special electricity tariffs which have been announced. So I will broadly expand your question, Aashav, and answer that because that is something which is definitely something that everybody is closely tracking. As you may have read, the tariffs in South Africa were broadly around 13.5 cents or thereabouts. What Eskom, which is the utility, has announced is approval from NERSA, which is the regulator, to bring that down to ZAR 0.87 for Glencore and Samancor, and which is valid for one year. But I think that is predicated on a couple of things. One, that as we understand that the tariff of ZAR 0.87 covers broadly Eskom's variable costs and some degree of legacy costs, but not their full overheads. So that in itself, to my mind, casts some sort of uncertainty about how practicable this is. Secondly, that NERSA has also said that the difference between the tariff to be paid by these two customers and what is actually required by Eskom is to be borne by the government. The question here is that how practical is it for only two companies to get a special tariff? But again, that is not in my scope of competence or control. But what we certainly are waiting to see is how sustainable is this tariff. Secondly, we believe that even if these companies start up production, it should lead to some, when ferrochrome production in South Africa has come down sharply, the ore exports to China moved up, I would not say correspondingly, but certainly as a consequence. So now with ferrochrome, if it were to pick up in South Africa, logically, it should lead to some lowering of chrome ore exports to China and therefore lower ferrochrome production in China. So at some level, we think it may turn out to be a zero-sum game. But more than anything else, I wanted to make the point that I am more concerned about what is in our control and the fact that we have a fully integrated business model, and we are efficient, we are competitive, a lot of focus on productivity and efficiency. I would focus on our capabilities rather than get distracted by the noise around what is happening elsewhere. Sure. Got it. Thank you for a very detailed answer. So sir, my follow-up is that there is this structural shift which is happening globally in the ferrochrome industry. Now, the cost curve for most of the top producing countries is moving significantly upwards. Given your multi-decade experience in the industry, how significant do you see this happening, and how beneficial it is for integrated player like ourselves? So you are absolutely right that there are cost pressures on non-integrated producers because chrome ore prices are moving up. If you look at UG2 prices in South Africa, they are around $300 a ton. I have not kept track of domestic prices in India, but they continue to be elevated. As a result, there are significant cost pressures. From that point of view, the fact that we have a fully integrated business model is what adds to our resilience and competitiveness. Now, one has to see how this plays out, but one of the reasons ferrochrome prices have moved up is, as I said, there is growth in stainless steel, not tear-away growth, but there is growth in stainless steel. More importantly, there are cost pressures. If demand improves further on account of stimulus measures in China, on account of some of the geopolitical issues, sort of moving towards a resolution, et cetera. If demand were to pick up a little bit more, I definitely see ferrochrome prices moving up. Equally, a lot of non-integrated producers in India have cut back production. There have been cutbacks in production other than in South Africa. We do see a sort of a structural gap between demand and supply persisting over the next one to two years, which should be supportive of prices. Then again, I would say this with a caution that this is a general trend that we envisage, but we do not really look at anything beyond the ongoing and the next quarter, because experience has taught us not to get ahead of ourselves. But I don't see any curve ball coming out from the left field which significantly alters the market dynamics at this point in time. Got it, sir. And sir, impact of Chinese anti-involution is already visible on ground? Sorry. Chinese what? Chinese anti-involution, the Chinese supply cuts, the inefficient capacities which they plan to cut on. That visit. Ferrochrome production in China has picked up significantly in line with South Africa cutting back. If they are taking some smaller inefficient furnaces out, they are adding capacity both in ferrochrome and the same exercise is happening in stainless steel. China is a consumer. As you know, they have a significant export duty on ferrochrome. We do not see increase in Chinese ferrochrome production being a threat in any manner to ferrochrome prices globally. Got it. That is all from my side, sir. All the best. I will come back in the queue. Thank you. Thank you. The next question comes from the line of Parthiv Jhonsa from Anand Rathi Group. Please go ahead. Yeah. Hi. Thank you for the opportunity and congratulations on a great set of numbers. I just quickly wanted to again circle back to the entire South Africa tariff scenario. Considering if things work out in their favor, do you expect all the smelters from Glencore and Samancor to come on stream, or it is only for certain smelters which will be there and a couple of smelters which are actually not operational since some time now, they will not come back on stream? Because if that happens, the supply crunch still persists, if I am not mistaken. Is the understanding and thinking correct, sir? Parthiv, thank you for your kind words on IMFA's numbers for the quarter. As far as South Africa is concerned, again, to reiterate, the tariff announced for two companies has come down from 13.5 South African cents to 8.7 or 87 cents, from 137, about 135 cents to 87 cents. As I mentioned, what we read is that it covers Eskom's variable cost and part of some legacy costs. So I think the concerns which have been expressed about how sustainable this is on account of the fact that it is for two companies, and certainly it will lead to demands from others as the expectations, whether it is manganese, steel, aluminum, et cetera. The second that, obviously covering only variable costs may not be sustainable, and that is where NERSA has very clearly said that the government has to reimburse, and the burden shouldn't go on to the average consumer. The ferrochrome producers on their side are saying that 87 is not good enough, and it needs to be 62. So this is a situation which is in flux. It is not something into which. We are seeing it from outside and reading about it, but I don't have any particular insight. But there is a lot of skepticism which has been expressed about how feasible is this and how sustainable is it going to be, one. In terms of revival of ferrochrome production, I understand that some of the smaller capacity, et cetera, has, I believe, permanently shut down. Now, if you look at the larger producers, I think their capacity can be divided into the more efficient ones like Glencore's Lion, and the rest, which are less efficient. So as of now, we don't have any concrete information, although I believe that Glencore might be restarting its Lion facilities in February or March. But then again, as I said, my expectation is that you can't have ore exports to China at exactly the same levels, even as ferrochrome prices picks up. Because, first of all, there is the availability issue, and second, there has been a distinct increase in Chinese ferrochrome production corresponding or consequential to a reduction in South African output. Now, if Chinese output doesn't come down and South Africa adds its capacity, then logically, ferrochrome prices will fall. Forget about what it does to us. That in itself is going to defeat the whole purpose of giving special tariffs to South African ferrochrome producers. You can't look at one part of the equation and say that tariffs have been brought down and therefore everything is hunky-dory. I think this is a complex equation, and there are multiple factors at play. You plug one leak somewhere, and it'll show up somewhere else. That's our take on the situation. Thank you so much, sir, for such an elaborate answer, especially considering the entire global macros interlinked to the entire fact. Sir, my second question is pertaining to your EBITDA per ton. I just wanted to get a sense that EBITDA per ton has actually surpassed this INR 25,000 mark, especially after Q2 of 2025. It's after multiple quarters you have actually surpassed that mark. I just wanted to understand what has changed between Q2 to Q3, that there is substantial jump in the profitability, and also how do you plan your Q4? Considering you have given the guidance at for 27 and 28, I just wanted to get a sense of ore raising guidance or whatever you can share for Q4 and also for the next two years. Parthiv, the short answer to what has changed between Q2 and Q3 of FY 2026 is ferrochrome prices. Realizations have moved up roughly by about INR 5,500 to about roughly, I would say, INR 6,000 a ton. That is what translates through into the improved EBITDA margins. In a single word, it is prices. As I said, in ongoing Q4, we did see that the INR 117,000, INR 118,000 come down briefly to about INR 106,000 to INR 108,000. But again, leading up to the Chinese New Year holidays, where there tends to be a little bit of stocking up by Chinese buyers, and consequent to ore constraints and elevated prices, domestic prices have moved back up to the INR 118,000 to INR 120,000 a ton mark. We do expect the current, I mean, what the average pricing that we saw in Q3 to more or less translate through into Q4, possibly with a slight upward bias. We are reasonably confident about similar EBITDA margins in the fourth quarter as well. Perfect. And sir, the ore raising, I think you have done like 265,000 tons plus of ore raising. So similar pace would continue even in Q4? Q3 and Q4 are the good quarters for ore raising because it is post monsoons and even from a weather perspective, you are not in the peak summer, et cetera. So Q3 and Q4 is the peak ore raising time. Just a word on the general trajectory. As you know, in FY 2025, our total ore raising was approximately 725,000 tons. As far as FY 2026 is concerned, we are looking at 850,000 tons, broadly speaking. As we have said, every year for the next one or two years is going to be a record because we are scaling up ore raising to cater to increased demand. The excess stock that we have been carrying will start getting now consumed because of the additional capacity. The board at its meeting yesterday also approved the annual budget for FY 2027. That is going to be a milestone year for us because we are targeting 1 million tons of ore raising. That is 10 lakh tons in FY 2027. Just to reiterate here the obvious point that our existing capacity, smelting capacity, plus expansion, plus acquisition is going to be catered to entirely from captive mines, and we are not going to be buying any ore. Perfect. Just a very quick, very generic question on the greenfield facility. How better is the techno-economic parameters compared to your other existing facilities? If you can just quantify in percentage terms. When you talk about techno-economic, the fact that it is, I mean, we are putting it up now, so whatever learnings we have from our previous furnaces and whatever shortcomings that we see, we try to address that in the design situation. We have moved to a closed furnace design which added to the capex a little bit, but obviously that enables us to get better norms, and roughly about 8.5 megawatts of power generation. The other question, which you and I in particular had this conversation during the CNBC panel post-announcement of the acquisition, is that Kalinganagar is, from a logistics point of view, very friendly given that we are close to captive mines, close to stainless steel producers who are our consumers, and close to Paradip Port. Once we get over the initial stabilization phase, and do keep in mind that when the new furnaces come online, we will have an initial period of stabilization. The heating period means you are consuming energy without getting ferrochrome production in turn. But leaving that aside, when you are in a steady state operation, we expect our weighted average EBITDA cost for the expanded output to reduce by about INR 1,500-INR 2,000 a ton on account of logistics costs and all of that. That is something that will obviously add to our margins. That basically means the current run rate of about 24. Yeah, sure. I will join in the queue. No issues. Prativ, I will quickly answer that question. I mean, obviously the most important variable here is where ferrochrome prices, how they pan out. We do expect, as I said, while we do not do really projections of ferrochrome prices, we can only give a little bit of visibility into the ongoing quarter than the next quarter. But the market dynamics are such that there will be some volatility. It is not going to be a steady line or only with an upward bias. But our key commitment is that we have the wherewithal to be more competitive and more resilient than most. That is one. In terms of cost structure, I mean, independent of this, I believe we have seen the lowest prices in the recent past in metallurgical coke prices, and that is something which is tending upwards a little bit. But then again, all of this will put pressure on bringing cost pressures on the entire value chain, and should translate through into perhaps better ferrochrome prices. While we are fairly comfortable with our EBITDA margins, that position doesn't apply to all producers. Thank you. The next question comes from the line of Harsh Vasa from SBI Securities. Please go ahead. Yeah. Thank you for the opportunity, and congratulations on a robust set of results and to the entire team. Thank you. My next question was that what would be the CapEx for FY 2026, 2027, 2028, if you could break up, and the CapEx would be what for which part? Like the amount, for example, for the mines and for the greenfield and like that. The total. Sure. I will ask Shaunak Gupta, our CFO, to respond to this question, please. Yeah. Yeah. Actually, on the CapEx side, as you know, in the KNR1, we have almost 60% has been spent out this year. So about 40% will be remaining, which will be around INR 300 odd crores will be the next year. And the other one would be your residual value of the ethanol project, which mostly we will be spending this year, but about INR 50 odd crores will remain for next year. And for the mines, we have around INR 200 crores of capital outlay or spent cash outflow next year. So approximately next year, we are expecting somewhere around INR 600 plus a little bit more on the general CapEx that we will be spending out. And the following year, it is primarily the expansion of the underground projects where the majority will come in in the following year. This is the overall outlay that we have somewhat planned for next 2 years, and it is like INR 600 next year and another INR 400-INR 500 the year following. So INR 1,000 crore will be for the next 2 years, but majority of the spend is happening in this year itself. Okay, sir. What was the CapEx which you have already incurred in this year? We have already incurred overall INR 370 crore this year. Okay. Till December. Mm-hmm. For the next 3 months, any amount, tentative amount? So in next 3 months, we have a plan of approximately INR 270 crore-INR 280 crore of spend. Okay. Thank you, sir. All the best. Thank you, Harsh. I will just take this opportunity to just provide a little bit more insight. Just to remind everyone that as far as our acquisition is concerned, which is at a base price of INR 610 crore plus GST plus net working capital, that is going to be funded entirely out of internal accruals. In as much as our KNR1 project is concerned, we do have a loan sanction of about, I think, INR 470 odd crore. The drawdown of long-term debt as of now is a little short of INR 80 crore. So we have hardly drawn down. We are focused more on internal accruals to meet our capex requirements thus far. We expect the strength of the balance sheet to continue even after the payout, et cetera. We will still have a comfortable cash position. Of course, with expanded capacity, we will have enhanced working capital available. So the focus is still to have a conservative bent of mind in terms of taking on debt. Okay, sir. Thank you so much for the elaborate answer. Thank you and all the best, sir. Thank you. Our next question comes from the line of Kaushal Kedia from Wallfort PMS. Please go ahead. Yeah. Thank you for taking my question. Sir, I have a generic question on the entire space. We heard the Vice President of the U.S. mention critical minerals, and they had a conference where they invited their partners. What do you think chromium is a critical mineral for the U.S. and they are setting up a price floor for it. I just wanted your thoughts on this. What is happening and what is this price floor, if you read it? So, as far as critical minerals are concerned, as all of you are obviously aware that China has an overwhelming position in terms of not just reserves that they are able to extract, but also the processing thereof. That is where I think the rest of the world is scrambling to get to some degree of self-sufficiency. If I look at it from India's perspective, lots of initiatives announced by the central government, which is the PLI scheme for rare earth permanent magnets, which is outlays for recovering critical minerals from tailings. As far as the current budget, which was announced a few days ago is concerned, there was a reference to the critical minerals corridor comprising Odisha, Andhra, and a few other states. Clearly, given the importance of critical minerals and rare earth elements, the fact that they are used at everything from household white goods to fighter aircraft and the sort, it is something that all countries are scrambling. The U.S. has announced this large fund that they are creating to stock up on critical minerals. Secondly, through the other initiatives, they are looking at coordinated action. That is where I think critical minerals stand. Again, I will take the opportunity to expand the question and respond. It is an area which we have identified as a potential area of interest for us because there is a degree of similarity because it involves mining and processing of minerals. That is something that we are closely evaluating, and when we find the right opportunity which is value accretive, we will move forward on it. Thank you. Thank you for the answer. Sir, I have a few accounting questions. What is the cash in balance sheet as of today? Shaunak, would you respond to that, please? The total amount which we are having, including investments we have in mutual funds and bonds, is close to INR 1,100 crores we have in our balance sheet. Sir, can you find the payment? Sure. Sorry. Yeah, the payment, yes. The INR 610 crores is the base one, and with GST, we expect somewhere around INR 700 crores will be the outflow. We will still have INR 400 crores in our balance sheets, plus whatever will be the future cash accruals from the business. Just to draw a sense, by the end of March, we will have about INR 400 crores post the Tata payment and about INR 300 crores of CapEx that you mentioned earlier that you will incur this year. Yes. We have- We should- INR 300 crores of CapEx, but we also have unutilized to what our MD said, is that we have over INR 470 crores of sanctioned term loan limit, which we have utilized only about INR 80 crores. Overall, around INR 390 crores we have unutilized, which we will see how much we will utilize on that, and obviously the cash position that we have of around INR 400 crores. Just a back of the envelope calculation. If the EBITDA margin continues to be the same for quarter four also, taking that into consideration, we should be somewhere around, INR 300 crores of cash in March, hopefully. Yes. You are right. It will be INR 300 plus crores of cash if the EBITDA continues in the same range. Sorry to interrupt, Kaushal. I would request you to rejoin the queue. Thank you. The next question comes- No, let him finish this question. What is your final question, Kaushal? Just give me one moment, sir. Mm-hmm. Thank you. Sir, he's fallen back into the queue. We will move on to the next participant. Okay. Sure. Madhur Chaturvedi from MAIQ- Sir, I just wanted to just close on what Kaushal said. The position is that whatever we were saying on INR 300 crores of CapEx payment that we will be doing, we will be having in our hand INR 300 plus crores of cash position accrual after payment of whatever is the accretion, as well as unutilized term loan of INR 390 odd crores. So almost INR 700 crores will be there in our hand. So we will just see how we will be actually paying out those cash outlays. There is sufficient funds in hand. Right. Yeah. Thank you, sir. We will move to the next participant, that is Madhur Chaturvedi from MAIQ Investment Advisors LLP. Please go ahead. Hi, Suprakant sir, Som sir, whole team, good afternoon. Thank you for taking the time, and congratulations on a fantastic set of numbers. Thank you. Just one. You guys have taken a lot of time and answered, I think most people's most questions. Just one sort of bookkeeping question from my end. I think after a while, our ferrochrome production in tons was slightly more than our ferrochrome sales. Just was wondering if this is a sort of strategic thing for are we seeing a bigger order next quarter? Is this maybe an impact of the slight price increase we've seen? I just was wondering if there was any reason to that. Broadly, I would say, Madhur, that in terms of quarterly production, we look at 65,000-66,000 tons, maybe up a little bit, down a little bit, there and thereabouts, and similar sales. I think in the past two, three quarters, I think in Q2, there was a lot of pressure from customers for supplies, which is where we ate into inventory a little bit and sold about, if I remember correctly, in Q2, the sales volume was close to 69,000 tons, which was a bit of an outlier. But we have sort of come back to that 65,000-66,000 ton sales and similar sort of production numbers. We expect in terms of production for the ongoing FY 2026, we expect to close at about 265,000 tons, and sales broadly similar numbers. The real jump, of course, will come from Q1 FY 2027 onwards when additional volumes come into play. But short answer, not so much trying to gain the market, but obviously, prices increase when there is demand. So it is not just a question of trying to encash on higher prices, but also making sure that our long-term customers, with whom we have relationships, we try to meet their requirements in terms of additional tonnages as and when it comes up. Absolutely. That makes perfect sense. Thanks a lot, Subhrakant sir, and best of luck for this quarter and the upcoming year. Thank you. Thank you. The next question comes from the line of Joe Shah from Seven Seas. Please go ahead. Subhrakant, congratulations. We are doing very well on our growth plan as far as KNR1 and KNR2 are concerned. I think by June 2026, we will be quite well on this plant. Now, second thing. Recently, Government of India has announced that coking coal were notified as a critical mineral. My understanding is that in India, we do not have low phosphorus coking coal available, and mostly we have inferior coking coal. What is your take on this coking coal? Thank you. You are absolutely right. As far as coking coal is concerned, India does not have very large reserves. I mean, we have very large reserves of coal, thermal coal, but not large reserves at all of coking coal. Moreover, what is there is a grade that we cannot really use in the ferrochrome industry, which is why, especially given the grade of ferrochrome that we produce, we are entirely dependent upon imported metallurgical coke from Colombia and from other sources. Yes, the declaration of coking coal as a strategic mineral has definite implications for the steel industry. This is a large import bill for them, and development of coking coal mines domestically will ease some of that pressure. But realistically speaking, no significant impact for the ferrochrome industry. Okay. Now one more question about Sukinda chromite mine surrendered by Tata Steel. Looking at the past happening of Hindustan Copper getting a copper mine in Madhya Pradesh, we also get excited that IMFA will also get this Sukinda really mine whenever it comes on table. What is your idea? They have announced that they would surrender. The process is yet to be completed. Yes. It is only when it comes up for auction that we can have a strategy. My answer would remain the same, that as with any other opportunity, we will evaluate anything which is interesting. We will certainly evaluate, and we will move ahead if we see it as being value accretive. Okay. Thank you. Thank you. The next question comes from the line of Sanket Kapoor from Kapoor Company. Please go ahead. Namaskar, sir. Namaskar. Hope I am audible, sir. Yes, you are. Yes, sir. Firstly, pertaining to our CapEx and the underground mining part, if you could just outline to us, what is the roadmap, how much have we spent? Pertaining to this underground mining, what amount of the CapEx goes towards the equipment? Whether we will be opting for the MDO route for the ores that will be taken out or what is the thought process there? I will ask Shaunak Gupta to share the CapEx numbers. We also have Sandeep Narade, who is our mining BU head on the call. I do not know if we have a ready. Broadly, the figure for CapEx for underground mining is roughly INR 1,000 crores. I do not know if we have a ready breakup of how much goes into equipment and how much goes into development. Between Shaunak Gupta and Sandeep Narade, I am sure they can answer your question. Shaunak Gupta? Yeah. On the overall CapEx budget of INR 1,000 crores, we have till now already ordered approximately INR 780 crores. As the thing moves up, the cash outlay is around INR 120 crores till now. As I was saying, the next year there is a higher amount of cash outlay on this. It is a mixture of both infrastructure CapEx payments as well as development costs that we have to incur for building up the whole underground mines. That adds up. I will also ask Sandeep if he can just add a little more on that. Just a point here, sir. Sorry, sir, to interrupt. INR 780 crore of order tendering is on the equipment part. Are we importing this equipment or are we sourcing them locally? No, INR 780 crores is not just equipment. It also includes an element of development because Okay the underground, two ventilation shafts, the decline and the main shaft are all being developed. There is a significant element of equipment in there, like winders and all of that, but INR 780 crores is not just equipment. Sandeep, could you just give Yeah a broad overview? Yes. Mostly we are operating on the MDO mode. You questioned about that MDO, so mostly it is about MDO. Out of overall capex, about 25% of amount will be spent by us for major equipment like the shaft winders and fans. Rest will be the service contract with the MDOs. And sir, are we sourcing these equipment domestically? Because there are few players in the country that are developing. In fact, one player only, Eimco Elecon, that develops, I think, so underground mining equipment and then the Gainwell Group. So are we- No. Yeah, please sir, correct me. All these equipment are not in our scope. They are in the scope of MDOs, and they are developing in India and also getting from outside also. Okay, sir. Lastly, sir, Panda Ji, for the ethanol part of the story, sir. Yes. Firstly, you have articulated that it was the land that was available to us, and that was unutilized. The availability of, I think, the RM was there in abundance that led to the project. But taking into account the line of interest that we have, what likelihood is going to be the story for ethanol? Because 250, 300 crore worth of project will also have management bandwidth and will have its own vagaries and nuisances going ahead, depending upon the government policy. Going ahead, how much of this ethanol is going to be a part of infra in the foreseeable future? Sanket, slight correction. It was not just available land, but also other infrastructure such as railway sidings and all of that for bulk handling of raw material. That is one. Second, as we scale up our ferrochrome capacity closer to the mines in Choudwar, of course, there is no further scaling up. But in Kalinganagar, at some point in time, that will lead to de-emphasis on Therubali. Therefore, it is important for us to find alternate uses on what we can do there. That is one. Second minor correction, the CapEx for the 120 KLPD unit is INR 150 crore, not INR 250 crore. It's INR 150 crore. We have, I believe, adequately conveyed that this is a small diversification because we do need to see what we can do in Ferroli. It is only if we believe that we have cracked the code and are able to This is more aligned, given that it is a B2B industrial product. It is more aligned with our philosophy than FMCG, for example, as I have been saying. But it is only if we believe that we have cracked the code and we can make it something value accretive that we will consider further expansions. So as of now, no further expansion commitments. We will review how this project plays out and then see what we want to take it forward. But I will just take this opportunity to reiterate that our primary focus remains the core business, which is ferrochrome. That is where the maximum time, attention and focus will be. So I would hope that there is not any anxiety on that front. Yes, sir. I will join the queue. If time permits, sir, can I raise one more question about the- I am sorry to interrupt, Sanket. I would request you- I will join the queue, sir. Not an issue. Thank you. Thank you. The next question comes from the line of Manan Vandur from Wallfort PMS. Please go ahead. Yes. Thank you so much for the opportunity. Sir, my one question was that what was the average cost of coke per ton in Q3, and what is the current price also for this current Q4 quarter? Suresh Babu, who heads our ferro alloys business unit can provide the details. Broadly, if I remember correctly, we are currently consuming coke, which is around the $250 a ton mark, and we are expecting that to move up a little bit in future procurements. Suresh, do you have the broad number? Yes. You rightly said. INR it is around 28,000 and $5 are expected to rise in the coming quarter. Just a follow-up on this. 28,000 was average for Q3. Or you are saying is this current? Current market price. Okay. Current is 28,000 and you are saying that around $5 can increase from here. What was the average for Q3? I think Manan, we have broadly shared the details. I do not want to go into specific products and specific inputs and exact pricing. Broadly, we have shared the numbers that there had been in line with the pricing pressure on ferrochrome realization pressure going back two, three quarters. Coke prices had come down noticeably. We believe it has hit rock bottom and our current stock, what we are consuming is around the $250 mark. Suresh is a little aggressive when he looks at $5. I would say that there might be a slight bit more upward bias in terms of costing for metallurgical coke. It is something that will add to our EBITDA cost a little bit, but not something which will be very significant. Okay. Just a second question. I am sorry to interrupt, Manan. I would request you to join the queue. Thank you. The next question comes from the line of Amit Lodha from Sanmati Consultants. Please go ahead. Hello. Please go ahead. Hello. Am I audible, sir? Yes, you are. Sir, congratulations on a very good set of numbers. Thank you. Most of the question has been covered by the earliest analyst. I have got only one question, sir, relating to shareholders. Yes. Actually, in recent times, your stock prices has gone to a very good level. We as an investor, when we bought the shares and such, find very difficulty to get the required quantity of the shares from the market. The prices shot up. There is wide fluctuation in the prices coming up and going down. Again INR 1,500, then INR 1,100. Of course, that is the market fluctuating, management is nothing to do. I have, sir, only one suggestion is all these ferroalloy companies like Nava Bharat Ferro Alloys, Godawari Power & Ispat Limited, Vedanta, Hindustan Zinc, all are having the low denominations, sir. They all are having INR 1 or INR 2 denominations. I would request the management, in the overall interest of the shareholder, that management should consider this subdivision of the equity in appropriate either INR 1 or INR 2. There are many more things. To enable the small shareholder, not only small shareholder, plus mutual fund and FIIs, they can easily get in the shares and they get out of the shares when they want. That will reduce the wide fluctuations in the market. That is the only suggestion from my side. Thank you very much. Thank you, Amitji, for your suggestion. We will certainly take that under consideration. I know this topic has come up about having adequate floating stock to provide liquidity. There are pros and cons to everything. We will certainly take your suggestion on board and always have the interests of shareholders paramount when we look at taking any actions. Sir. Thank you. The next question comes from the line of Rita from Kotak Securities. Please go ahead. Rita, please go ahead with your question. Unmute yourself in case if you are unmuted. Hello. First of all, congratulations to the management for such an excellent result. Thank you. I would like to just ask one question regarding what was the Since I was not able to join the call earlier, can I have a repeated set of numbers for what was the EBITDA margin for the previous quarter and what is expected in the next quarter? EBITDA margins, we have actually issued that in the press release. The previous quarter as in Q2 was, if I remember correctly, around the 18%-19% number. EBITDA margin in Q3 FY 2026 is a little more than 23%. What will be expected for Q4? Provided prices hold, which is what we expect it to be, we expect it to be sort of similar. Secondly, sir, in terms of what we say for the coke, INR 28,000 rise. Is it that INR 28,000 gets fully accommodated or there is a specific set of conjunction of coke which reduces the coke cost, or there is a one-to-one ratio per reduction? No. It is roughly 0.65 tons of coke per ton of ferrochrome. Is it the same case for ore as well, how much ore we gave that much? Roughly 2.5 tons of chrome ore per ton of ferrochrome. Okay. That is it from my side. Thank you so much. Thank you. Thank you. Thank you. The next question comes from the line of Vineet Thakur from Plus 91 AMC. Please go ahead. Hi, sir. Good afternoon, sir. Thank you for the opportunity. Thank you. I would just like to know what will be a sustainable EBITDA post-merger Tata Steel incorporation of the plant, and when could we see the revenue coming from it as well from that plant itself. The second question is easier to answer, which is that we expect meaningful contribution to top line and to financial numbers from Q1 FY 2027 itself. As I mentioned, we are looking to close the deal in the ongoing quarter, in fact, possibly in February itself. We might get a little bit of output in March, but we are not really taking that into consideration. If anything comes, that is a bonus. But we are basically speaking from first quarter of FY 2027. As far as sustainable margins are concerned, there are two factors. Clearly, there is volatility both in realizations as well as in input costs. In as much as chrome ore is concerned, we are relatively sheltered in terms of impact. But when it comes to metallurgical coke, when it comes to thermal coal for power generation, et cetera, obviously we are exposed to a degree of volatility. But just to reiterate a point I had made earlier in the call, what will be a significant sustainable advantage of the KNR facilities, KNR1 and 2, is that logistically it is far friendlier, similar to or perhaps even better than Choudwar. Therefore, we are expecting between INR 1,500 to INR 2,000 a ton, at least, of a reduction in weighted average EBITDA costing. Thank you, sir. Sir, what would be our peak CapEx and peak debt would be utilizing for the- Shaunak, could you answer that, please? Yeah. So overall basis, as I had said earlier, that the CapEx which we are having for the. One more time. You want the CapEx for which item exactly? I wanted the total CapEx like we are planning for mid to near term. What would be our total CapEx plan and what would be our peak debt as well? For Kalinganagar 1 project, we have a total CapEx plan of INR 800 odd crores. So that we will be spending out by mid-next year, that is next financial year. And for ethanol, we have INR 150 crores that already a major chunk will be spent by this year, and the residual amount will be left by that. On the mine side, we have said we have overall CapEx of INR 1,000 crores, but it is to be spent out in next four to five years as we go for the developments. And these are the three key ones. And Kalinganagar 2, that is a Tata Steel unit that we will be acquiring. The asset transfer of those unit, that is with GST around INR 700 crores. So this is the overall spent out, which we are doing. And of course, for the GST, we will get input tax credit. Input tax credit. Great. And sir, what would be our peak debt? I am sorry to interrupt, Vineet. I would request you to rejoin the queue. We will just answer that, Shaunak. Peak debt. Broadly at the moment, the long-term debt drawdown against the sanction limit is just short of INR 80 crores. The sanctioned amount is INR 470 crores, but depending upon how the ongoing and the next quarters go, we may not even draw down the full debt amount. We will see how that. But theoretically, the maximum it will go up to is INR 450, INR 470. Yes. From a debt equity point of view, we are not looking at, our outer limit is 0.5, but we are not expecting to go beyond 0.3 at most. Thank you. The next question comes from the line of Akshita from SBI Life Insurance. Please go ahead. Hello. Yes. Yes, go ahead. First of all, congratulations, sir, for such a good performance in Q3. Thank you. Sir, my question is regarding the market. What is the expected market in Q4? How are the prices going to react? Broadly, as I said, early on in Q4, there was a slight dip in prices. But now, primarily on account, I would say of Chinese demands stocking up before the New Year holidays, domestic prices have moved up to INR 118,000-INR 120,000 a ton, and Chinese prices are at about $0.96-$0.97. But in our case, we have long-term commitments, and therefore, offtake is not an issue at all. And we will have to see how exactly the price plays out. But at the moment, we are reasonably confident that price realization will stay around the same levels on an average for the entire quarter, will stay at the same levels as Q3, and therefore we can expect similar EBITDA margins. Okay. Sir, as of now, what is our export and domestic ratio? Very heavily skewed towards exports in excess of 90%. Going ahead in 2 years' time, we are expecting 60/40, still slightly in favor of exports, but certainly sort of more focus on the domestic market to ensure that demand is properly met. Sir, how much of our sales is dependent on LTC? What is the ratio? I could not understand. I could not hear the question properly. Sir, what is our ratio for the LTC and spot mix? We are primarily long-term contracts, Akshita. As I mentioned, the difference between the two categories of long-term contracts is where we have binding offtake contracts for one year or five years, as in the case of POSCO. What we technically categorize as spot sales is repeat sales to the same customers without any monthly or annual commitment. We do not really do spot sales where we find new customers and all of that. Now, with added tonnage, we will certainly look at certain niche geographies and all of that. Plus, we have also started producing niche ferrochrome with 0.5% phosphorus maximum and 1.5% silicon maximum, which has a significant premium of about 25% or so. For that, we are now starting to sell to some specific customers in Japan. Other than that, we could broadly call our entire marketing strategy as long-term oriented. Okay. Sir, can you just tell me what are the major customers? You mentioned POSCO. Two to three major customers. We have a joint venture with POSCO alongside our long-term contract. We sell to customers in Taiwan, in Japan. We do have sales in China. We sell some small quantities in Europe, which probably we will look to perhaps increase a little bit when we expand our capacity. Okay, sir. Thank you so much. Thank you. The next question comes from the line of Pritesh from Lucky Investments. Please go ahead. Yeah, sure. What is the volume guidance for FY 2027, the ferrochrome guidance? So- One second. Yes. Yeah. So as Please. What we have indicated, because we have the acquisition coming online, and we have the commissioning of our greenfield unit taking place starting June. From the present levels of about 260,000 tons, give or take a little bit, we have indicated that we expect production volume in FY 2027 to be approximately 400,000 tons, and we expect the volume in FY 2028 to be between 475,000 to 500,000 tons. These are of course, barring any unexpected developments, but I do not foresee anything of that sort. Just to continue here, these capacities, what is the break-even utilization level of these incremental capacities? I do not think we have really counted. We have really analyzed it in that manner, but we are absolutely running neck and neck in terms of our ability to produce and sell. Okay. In terms of volume, given that the total consumption of ferrochrome worldwide is in the range of 16 million-17 million tons. Enhanced capacity, placing that with our. Even now we face a lot of, we get a lot of pressure from customers to increase volume. That is not a concern at all for us. My question was, what is the break-even levels usually of these capacities? They start producing after 50% capacity utilization starts churning out profits? From that angle I was asking. I understand, but that again depends upon a variety of factors. Okay. If you don't have captive ore, then the break-even levels will be much higher. As I said, that's not something that we have specifically gone into depth. Okay. Just one confirmation. Based on the setup that you talked about Africa, it's a zero-sum game, and considering the capacity which is shut down, the overall construct, does it make you believe that the ferrochrome prices will stay higher than what they were in the recent years that we saw? Usually the chrome price, ferrochrome price oscillated from 85 to 95. Are we in a newer band? At least that directionally can be concluded, or even that cannot be concluded. I think, the way you put it at the end is a better way to look at it, which is that there will be some volatility going ahead. It would be foolish of me to say that it is only going to be in an upward direction here on. There will be, but I think in the near term what we can see, we are quite confident about the market dynamics. But if I were to stretch your question, the period that you mentioned in your question from 1 to 2 years, if you look at the last 10 years, clearly, slowly but steadily, the band has moved up. I would just like to mention that last year when we had an investor interaction, physical interaction in Mumbai, I had made a point that judging by our experience and what we see, I would broadly think that a fair price for ferrochrome is in that INR 1.05 lakh to INR 1.10 lakh range. I mean INR 1.10 lakh range on average and taking into account cost pressures and all of that. But there will be obviously a range below and above that. Okay. Thank you very much, sir. Thank you. Thank you. The next question comes from the line of Aashav Patel from Molecule Ventures PMS. Please go ahead. Thank you for the follow opportunity. My last question, sir, as you rightly mentioned that most of our production volume is tied up with long-term contracts and specifically more so tilted towards export side. Recently we have been observing over the last few months domestic ferrochrome realizations have been much higher than the global ferrochrome realizations. Do you see a case for dedicating one of the two upcoming Kalinganagar facilities maybe specifically to cater to the domestic spot market and so that as a strategy to capture the domestic spot increases in realizations better? Ashaf, as I very clearly said, we expect to move from 90-10. That is 90% exports and 10% domestic market at present with enhanced capacity over the next two years for it to be somewhere around 60/40. That is not only a reaction to domestic prices because there will be prices domestically or internationally will move up and down a little bit. We believe as the market leader, it is in many ways our responsibility to see that we are able to meet domestic demand. That should be our priority, and that is what we intend to do. Got it, sir. All the best. Thank you. Thank you. Thank you. The next question comes from the line of Aditya Mutha, an individual investor. Please go ahead. Hi. Good afternoon, sir. Sir, almost all my questions have been answered. I just want to know what was our variable power cost for this quarter. Aditya, we would not like to get into specific details, but variable power costs moved up a little bit in line with the quality of coal received as well as certain price increases. But nothing very significant. Broadly, I would categorize it as it moved up by about 10 or 15 paisa per unit. Nothing that I would say that has added significantly to our cost structures. Okay. Thank you, sir. Thank you. I'll get back in the queue. Thank you. The next question comes from the line of Pragyam Ladda from Omni Securities. Please go ahead. Good morning, sir. All my questions have been answered. Just one question. Do you see a one-off due to this Tata Kalinganagar plant integration in Q1 and Q2? No, I do not see any one-off in that regard, but again, when you start up all the furnaces, there will be an initial heating up period and some power consumption, et cetera. So some startup costs will be there, but nothing one-off in terms of integration costs. Maybe some investments in aligning our ERPs and all that because they are on SAP, we are on Oracle. But nothing major in that regard. No major margin pressures, right? No. Margin accretion, in fact. Okay. Okay, sir. Thank you. Thank you. The next question comes from the line of Joe Shah from Seven Seas Business Solution. Please go ahead. Subhrakant, I think our worry should be South African power plant. I understand that there is a lot of movement to reduce power cost for supply to Samancor and Glencore to 62 cents. People over there are saying that the South African ministry is easily available, unlike in India. My counterpart met him just two days ago, and he said there will not be any tariff on the export of chrome ore. They are very clear about it. They say that such tariff will ultimately go to the miners, which they are not ready to do. Second thing, this funding of this cheap power is concerned. They are saying that they have so many benefits involved in pushing up the entire economy of South Africa. So they are looking for taking the South African economy out by focusing on the ferrochrome production. They are planning to have 3.5 million tons to 4 million tons of ferrochrome production. Even they were saying that they are looking at India also as their market. Obviously, we can have anti-dumping duty for South Africa to protect our market, but still, China and other places could be a bit difficult area. I would like to have your views. This is, I think, a real challenge coming to IMFA. The South African products and other things, we are quite safe, but the South African is a big worry for us also. Will you please give me your views, please? As I have said, I will reiterate that, I wouldn't want to focus on issues which are not in our control. I believe that we have the right business model, thanks to our captive mines and power generation, the ability to be resilient and competitive. That is all that I would focus on. We have the marketing relationships and the tie-ups to be able to place this. I believe that you will not simply see an increase in production of ferrochrome in South Africa without a corresponding impact on ore exports. Not to mention, because of scaled back production last year, their grid was relatively stable. As I said, this is a complex equation. It is not a simple thing that rates have been brought down and ferrochrome production will increase, and therefore, there will be an imbalance which will lead to lower prices. I believe it is a far more complex scenario, and there are various trade-offs involved. Is it something that we are looking at and observing? Absolutely. But we are confident about our ability to be competitive. I think in the end, that's what matters. So you think that Indian ferrochrome cost of production will be quite competitive compared to the South African cost of production? I would not say Indian ferrochrome production cost, but a fully integrated producer in India, yes. Sure. Yeah, sure. Thank you. Ladies and gentlemen, the last question comes from the line of Anant Sarda from Chhattisgarh Investment Limited. Please go ahead. Hello. Please go ahead. Yes. Am I audible, sir? Yes. Just to say that I am from Chhattisgarh Investment Limited. My name is Anant Sarda. Thank you for the opportunity, and congratulations on the brilliant set of results. I just have a question that, sir, there is a 150,000 of furnace capacity in the Tata project, and about 50,000 tons of furnace capacity was incomplete. Do you have any kind of like, what is the status of that, and when can that be online? You are right. The unit has four 16.5 MVA furnaces, which are capable of producing 100,000 tons, which are good to go. There is a 33 MVA furnace, which is partially complete, which can produce another 50,000 tons. Our estimate is approximately a year's time and roughly INR 50 crores of CapEx to make that operational. When we take control of the unit, our first focus will be on maximizing output from the existing operational furnaces, while of course, evaluating and proceeding with completing the fifth furnace and getting that additional tonnage from this. Okay. Thank you, sir. Sir, like you said that you are going to shift the international to domestic sales from 90/10 to 60/40 in maybe two years' time. But immediately we can see that the ferrochrome prices in domestic market is quite higher, as pointed by one of the fellow investors. Will the Tata Kalinganagar II, the Tata acquisition, will that be particularly used for spot market in the next financial year, sir? So, look, in the next financial year, we will also have our greenfield project commission. The point is that we will first and foremost give priority to wherever we have contractual commitments. That is what is our topmost priority. We are not going to divert tonnages because of higher realization sales there, because I think it is important to be considered a credible and reliable supplier. The second point I have made conceptually is that as the largest producer in India, it is incumbent upon us to make sure that the domestic market is supplied to the best of our ability. So taking that in mind, we are looking at the 90/10 becoming 60/40 over the course of the next two years. But we will obviously retain the flexibility to sell internationally or domestically, depending upon market conditions and demand. Okay, sir. And last question, sir. What is the roadmap for critical minerals space? Where do you want to position yourself? Maybe in the mining or maybe in processing or both, sir? What kind of strategy are you thinking, sir, for the company? Anant, it's very early days yet for us to give any concrete guidance on that. We are evaluating opportunities and as a general practice, I would say that we are open to evaluating all opportunities which come our way, and we will only pull the trigger on investments if we believe it is value accretive and we have a degree of competence. But having said that, we of course, both from a mining and a processing perspective, have the competence. But where exactly the opportunity lies and how we can maximize shareholder value is what will guide us, and it's too early for us to give any specific comments on that. Thank you. Ladies and gentlemen, that brings us to the end of the question and answer session. I would now like to hand the conference over to Mr. Abhishek Savant for the closing remarks. Thank you. Thank you to everyone who joined us today and participated in the discussion. We appreciate your questions and continued interest in IMFA. As always, we remain committed to transparent communication and delivering long-term value to our stakeholders. In closing, on behalf of the board of directors and management, we thank you all for your participation in this call. IMFA remains focused on operation excellence and long-term value creation. Should you have any further questions, please feel free to reach out to us. We look forward to engaging with you again in the near future. Thank you again and have a great evening. Stay safe. Thank you, sir. Thank you. Ladies and gentlemen, on behalf of Veritas Reputation, that concludes this conference call. Thank you for joining us and you may now disconnect your lines.