Q4 24/25

May 23, 2025

Summary

FY25 generated INR 430 crore of free cash flow before dividends despite weak ferrochrome pricing. Kalinganagar expansion and mine investment underpin growth, while market recovery remains uncertain and price benefits lag by 1.5–2 months.

Ladies and gentlemen, good day, and welcome to Q4 FY 2025 Indian Metals and Ferro Alloys Limited earnings conference call arranged by Veritas Reputation. As a reminder, all participant lines will be in the listen only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing star then zero on your touchtone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Aryan Rana from Veritas Reputation. Thank you, and over to you, sir. Thank you, Muskan. Good afternoon, everyone. On behalf of Indian Metals and Ferro Alloys Limited, I extend a warm welcome to all participants joining us for today's earnings call. We appreciate your continued interest and support. This session aims to provide deeper insights into our performance for Q4 and the full fiscal year ended March 31, 2025, as well as the strategic direction for the road ahead. Following the opening remarks by our management, we will open the floor for Q&A session. Finally, keep your questions concise and relevant to allow broader participation. IMFA, India's leading fully integrated producer of ferro alloys, has demonstrated resilience in Q4 FY 2025, despite ongoing market challenges. The performance underscores the company's focus on operational excellence, disciplined execution, and long-term value creation. Our financial results and investor presentation are available on our website and have been filed with the stock exchange for your reference. Before we begin, I would like to remind you that some of the statements made in today's discussion may 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 today's call are, and I welcome Mr. Bijayananda Mohapatra, Whole Time Director and Chief Operating Officer, Mr. Saunak Gupta, Chief Financial Officer, Mr. Binoy Agarwal, Head, Power Business Unit, Mr. Sandeep B. Narade, Head, Mines Business Unit, Mr. Suresh Chigurupalli, Head, Ferro Alloys Business Unit, Mr. M. Venkatesh, Head, Sales and Marketing, Ferro Alloys Business Unit. With that, I would now like to hand over the call to Mr. Saunak Gupta, our Financial Officer. Over to you, sir. Thank you. Thank you, Aryan, and good afternoon, everyone. Thank you everyone for joining today's earnings call on Q4 FY 2025 financial results. In my first earnings call briefing to you all as CFO of IMFA, let me take you through the financial highlights for the fourth quarter and full year ended March 31, 2025. At the macroeconomic level, Q4 FY 2025 experienced uncertainty on trade policy related developments along with geopolitical situation impacting several segments of commodity markets. Global ferrochrome market traversed through a phase of subdued global demand and weak pricing trend. Despite this, IMFA demonstrated resilience and marshaled its resources on cost optimization, operational efficiency improvement, and leverages fully integrated model. The standalone and consolidated financial results have been already uploaded in our website for your perusal. As you would have seen our results, despite headwinds, our focus on efficiencies and disciplined capital allocation allowed us to deliver a positive free cash flow, retain our healthy financial position. Some of the key business and strategic highlights of FY 2025 are chrome ore reached crossed seven lakh metric ton for the first time for IMFA. Our work has commenced on that 96,000 metric ton per annum greenfield ferrochrome expansion project in Kalinganagar. The orders and LOIs have been placed for civil and structural works, major furnace equipments and power transformers. During the year IMFA has signed a power purchase agreement with JSW Green Energy Group to acquire hybrid renewable power of 70 MW contracted demand. Further, we have entered into another binding term sheet with Ampin Energy Utility One Private Limited to acquire hybrid renewable energy of 40 MW contracted demand. This will enhance energy security and will substantially reduce our carbon footprint. IMFA has also received necessary statutory clearances for the 120 KLD ethanol project and has also placed all the major equipment orders. Boundary wall for the project has been also completed. Further, during the year, and especially in quarter four, the regional director, eastern region has approved the scheme of amalgamation of the merger of Utkal Coal Limited with IMFA with an appointed date of March 28, 2025. Financial entries for merger as per indents have been passed in the financial books of IMFA in quarter four FY 2025. While the macroeconomic environment remains uncertain, early signs of recovery in pricing, particularly in April onwards, gives us confidence in a more stable FY 2026. Globally, stainless steel production has grown by 7% in calendar year 2024, and capacity rationalization in market like South Africa is expected to rebalance the supply demand dynamics. In FY 2026, we remain focused on cost optimization, operational efficiency, and executing on our growth initiatives and to deliver the value to our stakeholders. With that, I will now open the floor to any questions that you all may have. Thank you very much. We will now begin the question and answer section. Anyone who wishes to ask question may press star and one on their touchtone telephone. If you wish to remove yourself from question queue, you may press star and two. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Aashav Patel from Molecule Ventures PMS. Please go ahead. Thank you for the opportunity. A very good afternoon to the entire team. Sir, my first question is, what is our EBITDA cost per metric ton for Q4 FY 2025? Yeah. The EBITDA cost is INR 76,980 for quarter four FY 2025. Okay. And sir, what is our met coke cost for Q4, the same quarter? So for the ferrochrome cost per metric ton in it- No, met coke. Yeah, I am saying that. The per metric ton cost of ferrochrome, the met coke component in that is about INR 15,150. Uh-huh. Okay. So it is similar to that level. So why I'm asking this is because met coke prices have been continuously falling very much. So I just wanted to understand and gauge when do we accrue the benefit of falling met coke prices. So if 15,000 per metric ton is the rate for Q4, what was the opening inventory for this financial year of met coke? Per metric ton value. I will just put it to Suresh. Will you be able to give your input on that? Suresh? I think Suresh would have dropped out. If you see, for this last year, our average met coke cost was INR 18,881. From there, this year we have come down to INR 15,543. We usually keep the stock of about 3 months because the major portion is imported. The flow down will take some more time, but we have already envisaged and seen a drop in the current year compared to last year's average. Okay. We should see further benefit in Q1 and Q2 of falling met coke prices. Yeah. If we see that drop, we will definitely get some benefit. Sure. And sir, our ore raising is now highest ever. We are close to 7 lakh range. I just want to understand how the inventory of chrome ore has been over here over last, say, 2 years. For example, earlier we used to keep close to 2 lakh tons of inventory versus what does it look like right now? Yes, on that part, I will just request Sandeep, our mines BU head, to put insight on that. Sure. Right now we are having about more than four months of inventory of ore at our plant site, both the plant site. Also at mine about two and a half months inventory is with us ready to dispatch. Okay. Earlier, what was this figure, say, a year back? It was about in the plants about three months stock was there. At mines about one month stock was there. Okay. We have basically increased our inventory on books by close to 50%, right? Yeah. Okay. And sir, equipment order has been completed for Kalinganagar expansion, equipment ordering? Yeah. Major equipment ordering has been done for Kalinganagar project. The point is that we have planned to commission it mid of next year, the first one is somewhere in June 2026. That is on track. Though the earlier question you were having the chrome ore, there is a 50% increase from last year. It's not 50%. There is around 20%-25% increase from last year. Basically we are building it up for the Kalinganagar project because the moment it gets commissioned, we will be requiring chrome ore. As you know, we cannot immediately jack up our production at the time of commissioning. We have to build it up. Gradually we are building it up for the chrome ore production. Got it, sir. Mm-hmm. And sir, regarding the recent Merafe shutdown, what we have been hearing, I guess close to 8 lakh metric ton has been brought down by Merafe in South Africa. Can you please throw some more light on the furnace closure in South Africa, how that has moved and what other players like Glencore was also earlier reviewing their business situation, but not sure whether they have closed down also or not. Can you please throw some light I will turn to M. Venkatesh, our Head of Sales and Marketing, to add his insights on that. Right. Merafe announcement, you know, Merafe and Glencore are partners. They are partners. Merafe's announcement was due to the market conditions, so the reduction in production. But Glencore also has announced they will start looking at more chrome units. What they mean by that is because there are challenges in South Africa, electricity costs have gone up and the challenges with regards to the ferrochrome market per se. They have reduced the production on a temporary basis. When they say chrome units, I believe they would be looking to export maybe more of chrome ore out of South Africa. Okay. Let me put it other way around. Given that China completely is dependent on the imported chrome ore. Right now as we speak, still we are at an advantage of, say, close to 20,000 metric ton per ton in terms of cost of production compared to China because of our captive ore. I do not have the exact cost of China. Yes, we have an advantage of having a captive mine. China has totally to depend on South African ore, primarily South African ore. So definitely their cost of production as far as chrome ore goes would be higher. But as far as other raw material goes, they may have a slight advantage, more specifically to do with coke. Okay. And sir, recently the most Sir, may I just request I am sorry to interrupt. I just request you to follow with the queue, please. Sure. Yeah. Thank you. The next question is from the line of Aditya Welekar from Axis Securities. Please go ahead. Yeah, thank you for the opportunity, sir. My question is on this forward-looking guidance, means what kind of chrome ore, ferrochrome production trajectory we expect for FY 2026, and then once the one lakh metric ton Kalinganagar smelter starts. What will be the ramp-up time for that? For fiscal 2027, how much we can expect from that new facility? I will just pass this out. Suresh, you were there? Yeah, I am added, yes. See, in the first year, we are expected to start the production from the mid of 2026, 2027. That is around July we are going to produce. June, we are going to commission. So ramp up will happen. So in the financial year, it will be around 50,000 to 60,000 production will be there. Okay, understood. As you said, there is 12 months of inventory already of chrome ore now on the line there. So for fiscal 2026, the new ore raising will not be materially higher, right? Given the inventory situation we have. Is that understanding right? Yes. Connected with the new facilities, there will not be a problem. Understood. Any CapEx guidance for FY 2026 and 2027? On the CapEx part, as we have mentioned earlier, almost INR 840 crores of our investment is in Kalinganagar project, which the first furnace is scheduled to get completed in June 2026 and the second one in September 2026. Beside that, we are also under this project completion of 120 KLD ethanol project, which is about INR 150 crore, which is on course. On the underground mines, which is overall in a five-year tenure, it is about INR 1,000 crores we will be spending, but a part of it will also come in FY 2026. Overall, we expect in FY 2026 around INR 800 odd crores, INR 800-INR 900 crores will be the outlay for all these three projects. Understood. I have few more questions. I will join back the queue. Yeah. Thank you. Ladies and gentlemen, in order to ensure that management is able to address questions from all the participants in the conference, please limit your question to two questions per participant. If you have a follow-up question, we request you to rejoin the queue. The next question is from the line of Supriya Shah from Kotak Associates. Please go ahead. Hi, good afternoon. There is a decrease in EBITDA by 44%, when revenue has only decreased by 12% and cost has also decreased by INR 1,000 per ton. So, what is the reason for the decrease in EBITDA? No, this EBITDA 44%, which period are you comparing? From Q3, 2025. Q3, our EBITDA cost was about INR 77,800, and now it is about INR 76,980. Almost, it is just about 800 odd rupees per metric ton reduction. Not significant. But for that, primarily, the reduction is on the chrome ore raising cost to some extent and to some extent on your coke cost. What were the Q4 specifics in terms of ore, coke, and power? Our power cost is INR 4.09 per unit variable cost. On the power, I will ask Binoy to just add his inputs on this. Yes, Saunak, you are correct. In Q4 FY 2025, the variable cost of power is INR 4.09, and compared to Q4 FY 2024, which is 28 paise less than in this quarter Q4 FY 2025. It is mainly due to coal only. Coal price has come down due to transportation of coal by rail. For ore and coke? On the chrome ore part, Sandeep, can you put some insights on that or your views on this? Chrome ore cost in Q4 was a bit lower due to higher production in Q4. We have gotten more production than our budget. Yeah. Chrome ore from Q3, there was a reduction in this because of the higher production and certain cost optimization initiatives that we have taken. For that, overall, the cost has gone down, and it was per ton of ferrochrome, it was about net basis, it was INR 17,400. What was the specific ore in terms of HFC? Yes, that's- Specific ore you are talking of? Yes. Specific ore is around 2.35 levels. It varies based upon the grade what we are making. It is 2.32. What was the coke per ton price and specific coke per ton of HC FeCr? The coke price in this quarter is around INR 31,000. Specific, you can consider it as 560 kg. Thank you. Thank you. The next question is from the line of Manan Bhandari from Wallfort PMS. Please go ahead. Hello. Thank you for the opportunity. There was a little bit of confusion. I would just like to re-clarify the questions asked by the previous participant. The cost of chrome ore per ton, I want to know. Not per ton of ferrochrome, but 1 ton of chrome ore is how much cost? Quarter 4 was INR 7,500. Primarily what Sandeep has given the reasons. Because of that, it is INR 7,500. Okay. And we normally consume 2.5 tons, right? Yes. Yeah. 2.35 tons. 2.35 we have consumed in this quarter. Okay, 2.35. Is that also generally 2.35 or more than that? No, it varies depending upon the grade. You can consider from 2.35 to 2.5. Okay. Understood. Sir, the next question would be on the average ferrochrome price. We have long-term contracts and we have spot contracts also, right? For the long-term contracts, could you please give us what is your ferrochrome price for those long-term contracts, please? Venkatesh. Yeah. We don't very specifically have anything regarding long-term contracts because most of the contracts are long-term. But what I can say is the average price realization for prime would be around 93,500. Okay. Because last quarter when I asked, it was around 89,000 to 90,000 per ton, which is like almost 60% of your total sales is long-term contracts. Hence I just asked. And also this changes every month or 3 months. I just wanted to add that what you are saying, 89,000 to 90,000, it is the net realization. That is the total, whatever is the ferrochrome we sell, which this quarter is 87,000. 87,001. Yes. There is a drop in the average realization. Yes, it is correct. I understand. But the long-term prices which you have with POSCO and other people you have with, those prices would be INR 93,000, you said? See, these are basically a bit of strategic pricing. Okay. Mr. Venkatesh has said, the INR 93,000 is the overall long-term contract average. That is the prime cost we have. Okay On the totality basis, our average comes to this quarter, it has come to INR 87,021 is the average realization. Correct. Understood. Just one second, sir. And sir, current ferrochrome prices, because the average would be what? Because anyway, the quarter has almost ended. So what would be that? See, on that net realization value that I said, and with the average for Forex, whatever is the dollar cost, it is about $0.76. But as I mentioned, there we are seeing from April onwards some upstick in the price. But it was for the quarter, February, March was very low. Almost China was hovering around $0.75. So our average is around $0.76 on the net basis. Correct. I understood, sir. I just want to know for this quarter, Q1, because 2 months have ended. Now April be over and even May is gone. So what would be the price as of this quarter is what I want to know. Normally for forward-looking pricing, usually, as you know, there is a certain restriction on the SEBI guidelines, so we have to stick to that. But the only thing I can say is that we are seeing certain upsides in the overall market on the pricing side. Venkat, what would be that percentage of upside around? What we are seeing the prices currently is around INR 1 lakh per ton. Okay. On the prime basis. Yeah, on the total price. I am not talking in terms of the realization. I mean, the total price what we are seeing today is around INR 1 lakh per ton. Okay, understood. Thank you, sir. Thank you. The next question is from the line of Devi Jani from Tata. Please go ahead. Hi, everyone. The status of the Sukinda underground plant. Yeah. Sandeep, you can give your insight on that. Can you please repeat once? She is asking for the Sukinda underground mines update. Yes. For Sukinda mines expansion plan, we are already given the major contracts. All the works are in progress for the decline, for the ventilation shafts, and for the main shaft also. That is in line as per our plan. Okay. My second question is, what is the ratio of HC FeCr and Pardon? We could not hear you. What is the ratio of? Sir, I just want to ask, what type of electric grade do we use for production of HC FeCr? See, it is all based upon the market requirements. Based on the market requirement, the grades changes. Is it indigenous or do we export? No, it is indigenous from our mines only. Can I have a little bit of knowledge on what was the stripping ratio for Q4? What was it? Pardon me. We could not hear you. Once more, can you please repeat? What was the stripping ratio in Q4 in terms of mining? Sandeep, you can add on this. For open cast, the stripping ratio is about 1 is to 3.5. With the Cr/Fe ratio, which was last told in the communication with stripping is- No, you are asking the stripping ratio that I have told. Now you are talking about Cr/Fe ratio. That is different. That is 3.2, right? Currently. Yeah. Suresh Babu can tell about that. Cr/Fe. Yeah. Cr/Fe ratio also varies. It moves from 2.5 to 3.5. Okay. This all certainly added up to this. Also, the ferrochrome grade went above 60, or was the realization low in the market, so it was below? No, we make 60 only. Our grade will be 60 plus. Based on 60, the blending we will do accordingly. Okay. Thank you. Thank you. The next question is from the line of Manpur Chaturvedi from MAIQ Capital. Please go ahead. Hi, sir. Good evening. Good afternoon. Thank you for taking the time, and congratulations on putting up a formidable result even in challenging macro environment. Congratulations on the ceremony for the installation of the Kalinganagar plant also yesterday. Just wanted to get some more clarity. What is the CapEx numbers, because in previous calls it was INR 650 crores for the 1 lakh ferrochrome expansion. Now in this press release it was INR 900 crores. Just wanted to get a clarity on, if we can just do in terms of ferrochrome capacity, what would be the CapEx? For the mining capacity, what would be the CapEx? Just sort of the timeline of when that would be incurred. If we could just get that more granularly, I think that will be very helpful. Yeah. As we had mentioned last quarter also and this quarter. First of all, thank you for your good words on the performance of the company. Yes, yesterday we had opening ceremony of our Kalinganagar project. On the CapEx side, on the Kalinganagar project, the total amount that I said was at INR 840 crores, and if you add up the capitalizable expenses that will be spent at the time of trial run, it will go up to somewhere around INR 900 crores. That is the overall CapEx, which obviously will be spent out by next year, September, October, by the time when we go for the commissioning of both the furnaces. June will be the first one and September 2026 will be the second one. That is on your first question on the- This includes working capital or this is purely CapEx? This is purely CapEx. Okay. Working capital will be separate. Okay. This is the CapEx outlay. On the mines outlay, we have a plan approximately INR 1,000 crores for increasing the capacity. That will be spent out in about 5 to 6 years from now. It will be spent majorly, it will be spent out in year-wise. In the initial 3 years, the major amount will come, and then it will taper down by FY 2031 end, by the time we reach the capacity of 1.2 million tonnes of raising. Got it. Perfect. Just in terms of the furnaces, I know you mentioned it. Who is our technology partner? What technology are we going with? Are we going with premix? Are we going with another technology like Outokumpu or what is the technology we are targeting, and how would that efficiency of power and chrome ore be in the new plant versus the old plant? Will we still expect the higher power to be around 4,000 units per tonne and the conversion to be around 2.35, or are we going with a newer technology where we can expect those numbers to be more efficient? Yes. I will request Ranjib Babu to give more input. Yeah. For that mining. Yes, this is a closed furnace. Both furnaces will be closed furnace. You know that smelting is energy intensive. I know. And the technology. Yes, so the off-gases we are using for the power plant. So the specific power will be of the same range because of our material, what we are using now. Got it. Perfect, sir. Just one last question from my end. This is more about the mining. With the mining, are we managing to extract more than our six lakh metric ton capacity? With that, are we able to increase our chrome ore inventory in anticipation of the power coming online, just from an operational point of view? Just trying to understand that if we, given the chrome conversion, most of our mining capacity goes into our production. Just what you think will be the maximum inventory we will be able to store in anticipation of the commissioning Q2 next year. So- Inventory. Yes, go ahead. Okay. Inventory will be just like based on what is right now. We are having inventory. You are talking for the Q2 of this year? I just read, we mentioned that we are sort of stockpiling inventory in anticipation of the commissioning of the new production line. Just how much we will be able to do that given that most of our chrome does go into our ferrochrome production. So how much we will be able to extract as a sort of buffer inventory so that we can start production at Kalinganagar once that line is ready? Right now, just as I said, we are having the inventory of more than 4 months at our both plant locations and about 2 and a half months at mines. That is- That is comfortable with going ahead into next year, or we can ramp that up more. Yes, obviously. It will be quite comfortable right now also it is. And we are increasing our production. Just like in the last FY, we have done 7.02 lakh. This lakh, we have the plan of 8.25. Okay. We will keep on increasing the ore production from the mines. Got it. Perfect, sir. Amazing, sir. I will rejoin the queue and thank you for your time and congratulations. Thank you. Thank you. Ladies and gentlemen, we request you to please limit a question to two questions per participant. If you have a follow-up question, we request you to rejoin the queue. The next question is from the line of Pranav Jain from Ageless Capital Finance. Please go ahead. Hi sir. Am I audible? Yeah. Yeah, Mr. Jain, you are audible. Hi sir. Congratulations on the opening ceremony for the new plant. I just had a few questions. I just want to understand the power requirement for the new plants and the details surrounding it. How much are we going to get? From where are we going to get? Could you dwell on it a little more? I will request our Chief Operating Officer, Mr. Bijayananda Mohapatra to add on that. We will go for this Kalinganagar project with the help of renewable energy, hybrid energy that we have tied with JSW, 70 MW and with Ampin with 40 MW. This will help for the new facility. Both are going to be commissioned in June 2026. Sir, the 70 MW- It is matching to our- Sorry. Pardon? I was saying the 70 MW and 40 MW, are these the total capacity or is this what we will be requiring? No. Our requirement for Kalinganagar, it is approximately 60 MW. Okay. But it is a hybrid. They will not give every time that 70 MW. The power will be utilized in the Our existing operation areas are Choudwar and Therubali. That will also get that renewable energy obligation. That will help, and it will also help our CMM sector. Got it, sir. Next, sir, as you can see, ferrochrome prices bottomed out in January, and now they are recovering, as said by the management as well. When can we expect the full benefit of these prices in our financials? Also, can you help me understand the lag in price realization? On this price relation part, I would say that the lag period is about one and a half to two months for us to get the benefit out of it. On the future outlook, I will just request Venkat just to give an overall viewpoint on the ferrochrome market price. Okay. Yeah, thank you. The challenges continue to remain. There has been an improvement in prices, but challenges continue to remain. Challenges, like all of us know, in terms of tariffs and ongoing conflicts. But there are small signs of the market improving. When we talk of China, they have introduced small stimulus measures. They have reduced the reserve requirement ratio. The banks have reduced the reserve requirement ratio by 50 basis points. They have let out banks can lend up to CNY 1 trillion more. So that is like a small stimulus measure there. They have also reduced the lending rates by 10 basis points. So these all will help in the domestic demand or to shore up that domestic demand. What we have seen with regards to tariffs, also, President Trump has kind of toned down a bit. Now China and U.S. have been talking, and there has been a tariff reduction, and the talks are continuing. We are also seeing now a direct conversation between Russia and Ukraine. So after the war, there is a lot of rebuild which has to happen. So going ahead, these are small signs of positivity, and if any of that clicks, then I am sure the market is going to rebound. Okay, got it, sir. Just a last question on a technical side. So how much coal do we require per ton of ferrochrome, and at what cost do we acquire it? Binay, Yes. Will you be saying the whole part? No, no. Say met coke. Met coke. That is what. Myself, yeah. For making a ferrochrome, it is around 560 kg coke is required. Okay? And the cost is around INR 31,000. Okay, sir. Okay. Thanks a lot and all the best. Okay. Thank you. Thank you. The next question is from the line of Rajesh Agarwal from Moneytor. Please go ahead. Hello. Sir, my question is there any further possibility of cost improving overall production cost? So here, as I mentioned in my initial note, that we are focused on improving our operational efficiencies as well as to get out more cost benefits in future. That's a continuous process. But it is again, to some extent, also dependent upon how the input cost market moves around. For us, the key one would be the met coke as well as coal, that's the power cost. There is a dependency on the market. But operational efficiencies, it's a continuous process. We keep on having internal projects to maximize on the cost optimization. What is the possibility, INR 1,000 per ton, INR 2,000 per ton over 2, 3 years? No, it is very difficult to predict that out currently because it's a continuous process. But as I said, if you see that this quarter 4, we are at 76,980 of EBITDA cost. We serve as 82,836 of last year. Okay. It's a mixture of both drop in the input cost, market price, as well as your cost efficiencies initiatives that we have taken. Sir, my second question is, the stainless steel market is very good in India. Simultaneously, Jindal Stainless was saying after the tariff, China has become a little costlier, and India's export also will increase. Why, if the chrome is the main, ferrochrome is the major raw material for stainless steel, why the realization and the price has dropped, and why there's no possibility of improvement if the stainless steel industry grows up by 10%? Venkat, you will take the call, then I will just add on to that. Okay. Stainless steel market is growing in India. There are two parts I will answer it. While the market is growing Okay there is a weakness also in the demand of Indian stainless steel. Jindal is increasing, but there are other producers who are really struggling. Okay. That has to move or mostly moves in line of what happens internationally. It is not that India can do too well and others do not do well. It is almost on similar lines. Stainless steel market in India, yes, the growth is happening, but demand continues to be weak. If overall the market improves, stainless steel, including India and export, there is a possibility of further improvement in our realization of ferrochrome? Yes. Ferrochrome. I am talking about structurally. I am not talking about quarter to quarter. I am talking about structurally. Structurally. Yes. We are looking at two things here. Number one, when we look at the prices, obviously they cannot be same in all the markets. There would be a difference, but they are at similar levels in different markets. The second thing is, going ahead, what we see, if you are talking of that structural, but going ahead, what we see, we would see a big jump happening in stainless steel production in India. Going ahead, for us also, the domestic market will become a focus. Okay. So realization is better in domestic or export? Right now, both the markets Right now are similar. Like I said, INR 1 lakh a ton is similar in both the markets. Both the markets. Sir. Will we enter into a long-term contract now? Sir. Hello? Sorry to interrupt. I just Last question, ma'am. Just last question. One more. Sir, if we get a better rate in the spot prices, will we still sell in long-term contracts? Long-term contracts have their own benefits. When the word long term means you do not look at one transaction or a month, you look at a horizon. Okay. Your material is assured to be sold. In a spot, you never know what happens. Okay. That is right. Thank you. Okay. Thank you, sir. Thank you. Thank you. The next question is from the line of Vineet Thakur from Plus NINE ONE. Please go ahead. Hi, sir. Good afternoon, sir. Congratulations on the new plant opening, plant work. I just had a question with the National Steel Policy of 300 million ton of FY 2030, what would be the ferrochrome demand going ahead? Would it be increasing or will it be neutral to it? Suresh, if you can. Venkat has the problem. Yeah. If I can get your question right, that was pertaining to steel, which is carbon steel, not stainless steel. Our ferrochrome goes into the making of stainless steel. The policy, what you said was of 300 million tons is of carbon steel. Stainless steel is also going to grow. Like I said, I was speaking a little bit earlier, stainless steel is going to grow, and we are there at the right time with our expansions happening. Obviously, we would be catering more to the domestic market like I said earlier. Sir, could you give a guidance on what would be the production numbers for next year? Sir, usually we do not give more than two quarters, whatever is the guidance. Anyway, on the H1, Suresh, you can give some guidance on what we can expect on the production line. Sir, production is similar to what we have. For the next half year, it will be around 130,000, two quarters. Okay, sir. Thank you so much. Yeah. Thank you. The next question is from the line of Aashav Patel from Molecule Ventures. Please go ahead. Hi, sir. Thank you for the opportunity. My question is, I have been following the company for past many years. Earlier, we were guiding for a furnace CapEx of only INR 500 crores, but now we are guiding for INR 900 crores. That is effectively 80% higher furnace CapEx. What has changed? There are 2 furnaces in our Kalinganagar project. Whatever we are seeing, INR 900 crores, is of the 2 furnaces overall. Yes, with time, the cost escalations will happen, and there will be a situation where we have to manage based on whatever is the cost of it. It is a 2 furnace, not a single furnace that- 2 furnace, what capacity we are considering? 2 furnace. It is what we said is that 96,000 metric ton annual capacity, it will add up. Capacity is earlier also we were expecting only one lakh capacity. 80% cost inflation, how can it happen in one year? No, actually, as far as what we have mentioned is that the cost was last year also, it was somewhere around INR 700 plus, what we have estimated. Now the cost has. We are also trying to put in the best in class in all the equipments over there. Keeping that into the mind, including whatever is the other capitalizable cost, it is INR 900. In the base level, it is around INR 840 crores. Okay. I am still not satisfied with the answer, but moving on. The second question is, recently, there has been an ADD investigation on the met coke, the specific grade which we rely on in terms of imports for fulfilling our requirement. What is your view on that anti-dumping duty investigation, and how does it impact us? Suresh, you can add on that. Yeah. See, for anti-dumping, what the ferro alloy is using, that is excluded. We actually require the ultra low Phos of 0.030. Okay? Whatever the appeal went to the DGTR, this ultra low Phos is excluded from the anti-dumping norms. Okay. We do not see ourselves being impacted from the ADD, even if it is imposed. Yeah. Got it. Okay, that is all from me. Thank you. The next question is from the line of Saket Kapur from Kapur and Company. Please go ahead. Namaste, and namaskar to the team. Thank you for the opportunity. Firstly, if I could just sum it up, it was the lower realization for ferrochrome per ton to INR 84,000. That led to this halving of our profit on a Q1Q2 basis, and now the prices trend are again moving above INR 1 lakh per ton. This is what the sum and substance of what the price action and the real reasons for the lowering of profits Q1Q2 basis. If we eliminate the Chinese part. Yeah. Saket, thank you for your good words on the business performance. On the realization part, yes, the net realization is about INR 87,000 in Q4. There is a reduction in that compared to the previous years. But INR 1 lakh per ton, which was mentioned by Venkat earlier, was on the prime basis. INR 87,000 is our total average cost that we give on net realization basis. On that, we are seeing improvements, but INR 1 lakh versus INR 87,000 is not comparable. It will be much lower than that. Okay. There will be somewhere, if you go by the comparable level, it will be somewhere around INR 92,000 to INR 93,000. Okay. And sir, what was the number for the December quarter, the average realization per ton? Just a minute. I am just For December quarter it was INR 96,943 net realization value. And the Q4 This was the average last year was 101,771. Okay. No, sir. INR 96,940 was the average realization per ton for the December quarter. Net realization. Net realization. Right. This has gone down to INR 87,000 for March quarter. Yes. That's why the margins has gone down. But to a major extent, through operating efficiency and cost optimization, we have actually able to manage or get a better profitability. Right, sir. Other than that, sir, we will be spending around INR 800 crores for this financial year. That is the FY 2025-2026. This is what the CapEx guidance is? Yes. For the three projects, approximately our spending will be in the range of INR 800 crores for this financial year, approximately. Okay. How much have we spent for the first 45 days? Have we drawn or this will be H2? The money will be drawn in H2. On the CapEx, we are managing through our own internal accruals. It has started. Approximately, we would have spent approximately INR 100 odd crores. But our major spend will come in the H2 of this current financial year. Okay. What is our closing cash balance as on March 31? You are talking of the total, including the- Net cash. No, you give me the net cash number after the short-term borrowing. If you see our overall cash position was about INR 906 crores. This is excluding any security deposit that we have kept. INR 906 crores we are having, and our working capital borrowings were INR 372. It is about INR 35, INR 40 crores approximately with the net cash flow we have. Okay. These are all invested into the fixed deposit and the short-term instrument only. Sir, just to remind you. Yeah. I will join the queue, ma'am. Only one second. Yes. Thank you, sir. Right. Thanks. Yeah. I will join the queue. Thank you and all the best, sir. Thank you. Thank you. The next question is from the line of Priya Shah from Seven Seeds. Please go ahead. Yes. First of all, congratulations to all of you for the second renewable energy agreement also of 40 megawatts. First was 20 megawatts, and now second is 40 megawatts. 20 plus 40, 110 megawatts renewable energy. Now, first question is about this chrome ore cost, which somebody said it is INR 7,500 per ton of chrome ore. So is it inclusive of royalty and taxes or without royalty and taxes? The INR 7,500 is ex-mine, so basically without the royalty. Without royalty. Okay. After this Kalinganagar project, what is our smelting plan, expansion plan? Because in five years we are looking for the ferrochrome production of about 500,000 tons. Right? What is the next smelter expansion plan? Yeah. In phase one, as we have mentioned earlier, we are adding approximately 100,000 metric tons. Once that Yes is commissioned out next year by September 2026, Okay we will be also having the phase two plan of expansion. There is already we are working on that. Currently it is phase one. We are having 100,000 metric tons, but we are open to expansion of the capacity. Okay. Looking at this renewable energy capacity of 110 MW which we have contracted. I understand from our DA's control also that our requirement in power is where 25% of the renewable in total energy consumption, 25% would be the renewable energy. We have some 204 MW of thermal capacity. So renewable energy will be able to give us more room to use our captive power, thermal power. Right. Still, when we look at the 110 MW of renewable energy, it means we can have capacity total consumption of about 440 MW. It is going on the higher side. Why it is going on the higher side? Mr. Mohapatra to just respond to that. Sorry. Actually, we have taken a 110 MW with two, three aspects. One is the current requirement is another 60 MW for this Kalinganagar project, phase 1. Phase 2, in this same land, we have a plan for putting up another 33 MVA. So there will be requirement another 30 MW. To say now with the CEBM, we will mix some renewable energy in our existing operational area like Choudwar and Therubali. To say that with the June 2026, we will get around 25% subsidy in interstate transmission charges. That will also give a long-term profit to us. With keeping all these things in mind, we have taken this. Okay. Thank you. That's all. Thank you very much. Thank you, Mr. Shah. Thank you. The next question is from the line of Aman Mandrecha from Augmenta Research. Please go ahead. Yes, Mr. Aman, go with the question, please. As there is no response from participants, we will move to the next. The next question is from the line of Anshika from Jaipreem Associates. Please go ahead. Hi, everyone. First of all, congratulations on this amazing result. I wanted to ask what would be the potential Q2 numbers in terms of production sales and EBITDA cost. See, the forward-looking thing, as you know, there are certain restrictions on SEBI guidelines. We will not be able to give you those exact values. But one thing we can say, already Suresh Babu has mentioned that the production will be in the range of around 65,000. And you know that whatever is our production, based on it, we also sell it off. So that would be there. Price relation will depend how the market behaves, but we have said we are seeing some sort of an upside from the low what we saw in quarter 4, that we are seeing. So that is the maximum what we can say as of now. Okay. Secondly, can I have a little on it about what is the current sales mix and how we are seeing it for the next quarter as well in terms of LTC and spot and as well as domestic and export? Yeah. Suresh, you can. Venkat can give the answer. Yeah. Could you just repeat your question, ma'am? She is asking about mix. Sales mix in terms of spot and LTCs and also in terms of domestic and export. In terms of percentage, it will be okay. Yeah. When we look at export to domestic, it will be in the similar range like what we have been doing, roughly about 90-10. 90 in export, 10 in domestic. That would be somewhat those numbers. 90%-95% in exports and 5%-10% in domestic. Spot, LTC would constitute about 80% of our sales. Most of it is with POSCO or some other customers as well? If any big customer, they are also having LTC apart from POSCO. Yeah. We are having LTC with many customers apart from POSCO. Yeah, they are big customers. That is all I can say. Okay. Yes, ma'am. Does that answer your question? Yeah. Just a last question, if I can ask in that follow-up because it says currently we are importing Colombian coke or are we looking in the means of getting the coke from the international market? Can you just repeat your question again? Existing coke import is from still Colombian market or are we trying to explore some different countries as well? Yeah, most of the coke is from Colombia only, and some part we're also exporting from other sources. Sir, any ratio to that? And we mostly use ULP coke or another type of coke? We mostly use ULP coke. The ratios are dependent upon the market product requirements. Understood, sir. As I can recall, the total cash generation for the whole year has been close to INR 100 crores. Cash generation in the sense? In terms of the operational business performance, what was the impact total cash generation in terms of what was the outflows for operation and net of the inflows? As we said that our PAT is INR 378 crores, and on the operating and as well as the investing activities, we add up, the total free cash flow generated was INR 430 crores. That is the overall. This is before payout of the dividend. Okay. Thank you so much, sir. Thank you. The next question is from the line of Manan Bhandari from Wallfort PMS. Please go ahead. Yes, thank you for the follow-up. Sir, my question was that I couldn't understand what is prime rate and that. Could you explain what is that prime rate what you said, around 93,000 something? Yes. The prime rate is basically the gross rate. And on that, whatever are the sales realizations, those things, means all the selling cost and selling expenses, transportation expenses, if you reduce that out, it comes to about 87,000. So we give you the net sales realization rate, 87,000. Sir, what is the percentage of these costs usually? Could you give an example? Let's say 1 lakh is the prime rate, gross rate, then what would be the rest? How would you do it? It will be varying from around. It also depends on the ocean freight cost and all. It varies around 6,000 rupees, between 5,500 to 6,500 rupees. Okay. That means the prime rate would be more and then the net rate would be less, that way? Yes. Okay. 5,000 gap. Sir, what you said, the long-term contracts of 93,000 which is there, that is prime, those long-term contracts? Yeah, that's the average prime cost. Okay, that's the average prime cost. Okay, understood. Sir, for example, let's say, I just wanted an example. So let's say today ferrochrome is one lakh as on today's date. So, in our realization, how much time will it take for that one lakh to come? How many months, for example? As I said, it takes about approximately one and a half months. Lag period is there, one and a half months to 2 months to get that full value of it. Okay, understood. Thank you, sir. Thank you. Next question is from the line of Akhilesh B, an individual investor. Please go ahead. Thanks for the opportunity. Am I audible? Yes. Yeah, you are audible. Sir, I had a few questions. Production next year can be 3.1 lakh to 3.2 lakh tons of ferrochrome, and in FY 2028 we can do 3.6 lakh completely? Yes. You are right. Okay. Have we entered into discussions for long-term contract of this expanded capacity? Or it is already tied up, we can have no problem in placing this quantity in the market. Venkatesh. I think you mentioned next year. I think you were mentioning the production will go up. That is FY 2026 you are talking of or? No, 2027. Yeah, 27. Okay. 3.1 to 3.2 and 28, 3.6, whether those can be met by us. I will answer. We, like I was mentioning a little while earlier, the domestic market is growing, so there is a huge potential in the domestic market. Added to that, our existing customers, some of them are also expanding. Their expansions are also coming up, and some of them, they take a very small quantity from us as compared to their total requirement. There is a scope there also. We have the option of expanding with existing customers. Primarily at this stage, we are trying to increase our presence in the domestic market. Is the realization better domestically compared to these long-term contracts? Or why are we going to change the mix between long-term and spot in that way? Yeah. See, like I was again answering that, you can't have a big gap between all these prices. There may be a little lag or a lead, but the prices overall over a period of time would be at similar levels, whether it's the long-term or when you look at spot. In long-term, you have that certainty. In spot, you don't have the certainty. I don't see price is going to play a role for us to decide. We would rather look at the requirement, and since the domestic requirement will go up, it would be better for us to cater in the domestic market. If need be, like I said, we have an option to also increase our exports. Sir, second question is on power cost. This new facility, we have tied up power. Will the effective cost be lesser, higher, or the same as our current power cost? I think Binoy can just add to that. For Kalinganagar, actually, we have tied up with hybrid renewable energy, and that power cost will be at par with our present generation cost. It won't be that high. Even after accounting for any subsidies, et cetera, it's not cheaper, it's at par. It will be at par. It's not that cheap. Because again, there will be transmission charges, enhancement or ED, something like that is there at the landed cost. So it will be at par with our generation cost at present. Okay. And, sir, one last question on this figure of INR 800-900 crores on the CapEx. If you could spend some more time commenting on how the figure increased, I think it will assuage a lot of concerns. Because the earlier figure was around INR 600 crores, INR 500 crores. If you could spend some more time explaining how it has increased. Suresh, you want to add, then I will just further add on that. No, you can talk about that. What I was just saying earlier, as I said that we are actually putting in a best-in-class plant over there, so we are looking into all the opportunities. That has increased, because last time, initially we had said it will be around INR 700 crores from there. It is on the base level, it is INR 840 crores. It has increased, as well as there is an escalation of the various costs which has happened. Because this INR 700 crores we had mentioned somewhere around 2.5 to 3 years back. That has gradually, with the escalation of cost, plus whatever is the quality of the equipments and all what we have done, that has resulted into increasing to INR 840 crores. And on that, based on whatever the current accounting standard, we can also capitalize whatever the cost which we will be spending for commissioning and trial run. That is adding up to about INR 60-odd crores. All totally, the full capitalizable value we are taking as INR 900 crores. And this is the final value now, there are no escalations on this number? Right. This is the final value on this. And this best-in-class machinery, will this plant have better efficiency than our spoil plant? Will the ratios improve in this plant compared to the prior one? Basically, the visibility of the operations will improve. It is more of the digitization we are doing. Those will happen to a major extent. Efficiency, we expect there should be a better improvement from the current levels. We are hopeful on that. Okay. Thank you, sir. All the best. Thank you. Thank you. The next question is from the line of Joy Shah from Seven Seas. Please go ahead. Gentlemen, I understand that for Q4, average realization was INR 87,000 about for per metric ton of ferrochrome. Now for Q1, we are expecting some INR 92,000 to INR 93,000 per metric ton realization, average realization. Please confirm my understanding. Mr. Shah, we are seeing Yes some upside, but as you know, there are certain lag period for getting this value in our books. We are having that. Overall, we are expecting that Q1, our realization will improve. But exactly quantifying at this stage is slightly difficult. Right. As you know, the market still is uncertain, so we can't predict what it will be at the end of June 30, considering the overall uncertainty in the market. But yes, our overall, currently as of the current date, we have a feeling that yes, it should be better than what we had experienced in quarter 4. Okay. Thank you. Yeah. Thank you, Mr. Shah. Yeah. Thank you. The next question is from the line of Manan Bhandari from Wallfort PMS. Please go ahead. Yes. Thank you so much for giving me another opportunity. Sir, we have 110 MW renewable energy contract. Would you please give us the details of that? Like per unit, how much price have we contracted it, and for how many years is the contract? Actually, 110 MW, we have signed 70 MW of contracted capacity with hybrid mechanism with JSW. Fine. We have signed binding terms with Ampin, 40 MW. Club up together is 110 MW. Correct. Both the agreement will be for 25 years, and they will be supplying power by June 2026. What would be the agreement price of that? One unit price. One unit price of JSW is monetary at injection point is INR 3.84, and with Ampin Energy is INR 3.75. This is lesser than our current 4.09. This will be helpful for us. Is that understanding correct? Yes. It's a generation injection point and your landed cost will be a little bit higher. But our variable cost is 49, it will be at par with that one. Okay. Understood. These are 25 years PPA contract. That's right. Already took 25 years. Correct. Okay. Sir, our long-term contracts, their contract prices are changed every 3 months or 1 month, or something like that is there? Like renewing of prices. Is something like that happening? For this contract of 110 renewable energy? No. Sorry, sir. About their. Venkat, you may add or respond to the question. Yes. There are contracts which have a quarterly price, and there are also long-term contracts which is a monthly price based on certain indexes. Both the contracts are there in place. Okay. Quarterly and monthly. How is this determined? These prices, how would they be determined? This is linked. If you look at the quarterly contracts, they are linked to what we call as EBM, that is the European Benchmark price, now declared by Samancor. You cannot have a long-term contract without any linkage to an index. You just cannot have a quantity without a price. It has to be linked. Similarly, we have certain monthly contracts, which is linked to certain indexes in China. One you said quarterly, sir, DBM, and the monthly one is which index? EBM, European Benchmark, E. Okay. EBM. The monthly one is linked to what, sir? It's linked to the Chinese index price. Okay, understood. If I wanted to understand any quarter's price, how is this linkage actually done? Is there a percentage form or is it directly that same amount? How is that done? That is a part of the negotiation. Just to give you a small example. Yes. The EBM went up by this quarter, that is quarter 1. From quarter 4 to quarter 1, there was a change of $0.05. But if you look at it, that $0.05 is an absolute number, but in terms of percentage, it is 3.7%. Based on these numbers, we negotiate the price. Okay. This was almost a 3.7% rise. For example, let us say in Q4, our realization was INR 90,000. In Q1 it would be almost 3.74% higher. Is that understanding correct? I cannot tell it will be exactly the same. Correct. It could be at similar levels. Correct. Understood. Thank you so much. Thank you. As that was the last question for the day, I now hand the conference over to Mr. Abhishek Savant from Veritas Reputation for closing comments. Over to you, sir. 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 shareholders. On behalf of the board of directors and management, we thank you all for your participation in this call. Should you have any further questions, please feel free to reach out to us. We look forward to engaging with you again in our future updates. Have a good afternoon and stay safe. Thank you. Thank you. On behalf of Veritas Reputation Ltd, that concludes this conference. Thank you for joining us and you may now disconnect your lines. Thank you.