Ladies and gentlemen, good day and welcome to the Borosil Limited Q4 and FY25 Earnings Conference Call. 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 this conference call, please signal an operator by pressing star, then zero on your touchtone phone. This conference call may contain forward-looking statements about the company, which are based on beliefs, opinions, and expectations of the company as on date of this call. These statements are not guaranteed of future performance and involve risks and uncertainties that are difficult to predict. Please note that this conference is being recorded. I now hand the conference over to Mr. Aniruddha Joshi from ICICI Securities. Thank you, and over to you, sir.
Yeah, thanks, Hamshad. On behalf of ICICI Securities, we welcome you all to Q4 FY25 and FY25 Results Conference Call of Borosil. We have with us today senior management represented by Mr. Shreevar Kheruka, Managing Director and CEO, Mr. Rajesh Kumar Choudhary, Whole- Time Director, Mr. Anand Sultania, Chief Financial Officer, Mr. Rituraj Sharma, President, Consumer Products, and Mr. Balesh Talapady, Vice President, Investor Relations. Now I hand over the call to the management for initial comments on the quarterly as well as yearly performance, and then we will open the floor for question and answer session. Thanks, and over to you, Shreevar, sir.
Thank you, Aniruddha and ICICI Securities, for arranging this call. I wish all of you a good afternoon. The Borosil team is delighted to be communicating with all our dear investors again. I'm very pleased to inform you that the Borosil Limited board has approved the financial results for Q4 FY25 and the full year FY25 during a meeting held on 19th May. We submitted our results and an updated presentation to the stock exchanges, and they're also available on the company's website for your review. Before I get into our financial performance, I would like to list some of our achievements in the last financial year. FY25 was a landmark year marked by several strategic and operational achievements beyond financial metrics.
One of the most significant milestones was the commissioning of our new borosilicate glass furnace at the end of FY 2024, which not only expanded our production capacity but also reduced our dependence on imports, aligning with our long-term vision of strengthening domestic manufacturing and Make in India. We are pleased to update that on April 2, 2025, Borosil Limited also announced the setting up of a manufacturing unit for vacuum insulated stainless steel glass bottles and containers through its wholly owned subsidiary, Stylenest India Limited. The estimated CapEx of the project is approximately INR 40 crore, which will be financed through a mixture of debt and internal accruals. The initial estimated production capacity is around 2.4 million units per annum, with commercial production expected to begin by Q4 FY 2026. Another achievement in the previous financial year was that revenue-wise, Larah became the number one opalware brand in India.
Lara was also awarded gold for best brand evolution in the consumer category at the prestigious Transform Asia Awards. We also successfully launched the Larah Premia collection, which is designed to enhance dining experiences and combines exquisite aesthetics with practical functionality, which makes it an ideal choice for contemporary homes. This is the premium range of our Lara Opalware. In FY25, we also refreshed Borosil's brand positioning to be enhanced every day for every Indian family. This shift was driven by consumer insights from nationwide research. We introduced a new logo and updated packaging and visual assets to reflect this stronger and more modern identity. We're also thrilled to inform you that on the HR front, Borosil Limited has been officially certified Great Place to Work. This recognition reinforces our commitment to provide a positive and empowering work environment for all our thousands of employees.
We successfully raised INR 150 crores through a QIP and received a very encouraging response from the investor community. We also received a long-term credit rating upgrade from ICRA to AA minus with a stable outlook, which is a testament to our strong governance and operational resilience. Our integrated marketing campaigns delivered strong engagement across digital platforms as well as offline and further deepened consumer connect. Finally, we continued our mission to promote healthier and more sustainable choices by encouraging the transition from plastic and melamine to glass, opalware, and steel, further enhancing our brand relevance in modern Indian homes. That is quite a long list of things we tried to do and achieve in the last year beyond the financial numbers. Now we will move on to the financial performance.
I'm pleased to report that Borosil Limited has delivered a strong performance in FY25, and here we talk about the whole year, with revenue from operations reaching INR 1,107.8 crore, up from INR 948.5 crore during FY24. This represents an impressive 16.8% year-over-year growth, placing us amongst the industry's top performers. The growth is a testimony to the effectiveness of our strategy, operational excellence, and most importantly, the trust and loyalty of our customers. It highlights our ability to overcome challenges and capitalize on new opportunities, further strengthening Borosil's market position. In FY25, the company achieved an operating EBITDA before investment and one-time income of INR 177.7 crore, up from INR 144.9 crore in FY24, which is a 22.6% year-on-year growth, reflecting our continued focus on efficiency. The operating EBITDA margin for FY25 stood at 16.3% versus 15.4% during the previous period.
On the downside, the introduction of UCPMP 2024, which restricts incentives to healthcare professionals, impacted our B2B sales, specifically in the pharmaceutical segment, by affecting bulk orders and distributor engagements. To offset this, we shifted focus to e-commerce and quick commerce, which delivered strong growth, but also led to higher customer acquisition costs. As a result, our advertising and sales promotion expenses went from INR 68.3 crore in FY2024 to INR 86.8 crore in FY2025. Other operating income includes INR 18.4 crore from shared service support income for FY2025, and the same number was INR 5.5 crore in the previous year. With the associated expenses, the point is that the associated expenses are captured under total expenses.
These are support services for the other two Borosil companies, which is Borosil Scientific and Borosil Renewables, and we recover these expenses from them in the way of that shows up in other income. Profit before tax for FY25 was INR 103.2 crores, up from INR 87.8 crores in FY24. FY25 also includes a one-time income of approximately INR 13.5 crores. At the same time, depreciation and finance costs increased by INR 31.1 crores, which is a very large increase, owing to the commissioning of our new borosilicate glass furnace in the Q4 of FY24. As a result, the PAT for FY25 reached INR 74.2 crores compared to INR 65.9 crores during the previous period. Furthermore, as per the Union Budget 2024, the discontinuation of indexation benefits on long-term capital assets effective July 23, 2024, led to a reversal of deferred tax credit.
This resulted in higher taxation for FY25, impacting profit after tax by INR 3.89 crore. Now, let's take a closer look at our category-wide performance for FY25. Borosil's consumer division continues to expand across both glassware and non-glassware categories under the Borosil brand, as well as our opalware range under the Lara brand. Speaking of Lara first, the Lara Opalware segment, known for its modern designs and superior quality, reported sales of INR approximately 384 crore in FY25, up from INR 358 crore in FY24, reflecting a 7.3% growth. In the glassware segment, which includes borosilicate glass, microwavables, servingware, lunch boxes, tumblers, and storage solutions, we recorded an exceptional year-over-year growth of 27.2%, with revenues reaching INR 252 crore in FY25 compared to 198 crore in FY24.
The non-glassware segment, which encompasses a wide range of small home appliances, insulated bottles and flasks, as well as cookware, also performed strongly, posting a 17.2% increase in revenue. Turnover for this segment reached INR 453 crore compared to INR 386 crore in FY 2024. This impressive performance reflects the successful execution of our strategy to expand the Borosil portfolio, catering to the evolving culinary and serving needs of Indian households. It also reaffirms the strong brand equity and broad appeal of Borosil across multiple product categories. Working capital has increased in FY 2025, mainly because of high inventory maintained for appliances and Hydra categories due to the regulatory challenges of BIS QCO implementation. The inventory of borosilicate glassware has increased as our furnace capacity, which was commissioned in Q4 FY 2024, is higher than our current sales. Therefore, this is adding to the borosilicate glass inventory increase.
Additionally, the inventory for raw materials, packing materials, etc., have increased due to a shift towards in-house manufacturing of borosilicate glassware. All of this has resulted in an average operating capital employed in the business, that is, capital employed without capital work in progress and investments, to become INR 841.1 crores during this year. During FY25, the company earned an operating profit, again excluding exceptional and one-time items and income from investments, of INR 96.7 crores, and this translates into an operating ROCE of 11.5%. ROCE moderated to 11.5% in FY25 from 15.1% last year, and that is mainly driven by our strategic investments in the new production plant of borosilicate glass, which was only capitalized at the end of Q4 FY24, as well as the expansion of opalware capacity, which happened in FY23, but which is not yet at full capacity utilization.
This caused an additional depreciation of INR 27.1 crores from the previous year, and that impacted the ROCE. This temporary dip reflects conscious front-loading of CapEx to strengthen our leadership in borosilicate glassware as well as opalware. As these assets ramp up and begin contributing with larger and larger capacity utilization, we anticipate the ROCE to rebound in the very near future. During the quarter-ended June 30, 2024, the company successfully raised INR 150 crores through a QIP to facilitate the repayment or prepayment of long-term project loans, working capital loans, and for general corporate purposes. Post-issue expenses of INR 4 crores, the entire net proceeds of INR 146 crores have been utilized. The company has utilized INR 107 crores for the repayment of working capital loans and INR 39 crores for repayment, prepayment, or long-term project loans.
Moreover, pursuant to the composite scheme of arrangement during the financial year 2024-2025, the company has paid INR 97.81 crore to Borosil Scientific towards repayment of loan, including interest. As of 31 March 2025, Borosil Limited has a net debt of INR 26.5 crore. At Borosil Limited, we have built a legacy of trust and quality, becoming a household name in providing table and kitchenware solutions to India. Our journey, which began with pioneering glassware, has evolved into a diversified portfolio that caters to the modern Indian consumer. Today, Borosil stands at a pivotal juncture as India embarks on an era of unprecedented economic expansion. Over the next two decades, India's rising middle class, increasing urbanization, and growing disposable incomes will drive massive consumption growth, particularly in home and kitchen products.
With the strength of new product development, innovation, and commitment to quality, Borosil is uniquely positioned to cater to the aspiration of millions of Indian households seeking superior, sustainable, and stylish kitchenware solutions. As mentioned, Borosil has expanded beyond glassware, emerging as a leader in Opalware. With Lara, we are amongst India's largest Opalware manufacturers, providing elegant, durable, and lightweight alternatives to steel, plastic, and melamines. The Indian Opalware market is growing as consumers embrace microwavables, stylish, and break-resisting dining solutions. Since acquiring Lara in 2016, we have driven its revenues from INR 480 million in financial year 2016 to INR 3,840 million in financial year 2025, with a CAGR of 26% over nine years, leveraging manufacturing scale, distribution strength, and innovative designs.
Borosil's non-glassware portfolio, spanning kitchen appliances, vacuum-insulated glass, cookware, and storage solutions, has also delivered outstanding growth, with revenues rising from INR 23 crore in FY 2017 to INR 453 crore in FY 2025, clocking a 45% CAGR. This surge is fueled by India's expanding middle class and rising aspirational spending, driving demand for premium yet affordable home and kitchen solutions. With a proven product range and strong brand equity, Borosil is strategically placed to capitalize on this consumption wave and scale its leadership in the fast-growing non-glassware segment. Borosil is driving India's transition to healthier, eco-friendly kitchen solutions by replacing plastic with glass and stainless steel. Tapping into rising disposable incomes and growing health awareness, the brand is converting plastic users to glassware and opalware. With aspirational design, educational marketing, and a focus on hygiene and elegance, Borosil is redefining the Indian kitchen and poised to challenge other materials.
India's INR 4,000-crore lunchbox market is undergoing a structural shift towards safer, microwave-friendly, and sustainable alternatives. Borosil is at the forefront of this transformation with its premium glass lunch boxes, offering durability, leak-proof design, and microwave compatibility. Borosil's Hydra range of vacuum-insulated stainless steel bottles, flasks, and containers has demonstrated exceptional traction, with sales going nearly 5X in the last five years. With India's insulated steel bottle market valued at INR 2,000 crores and rapidly expanding due to its rising demand for durable, sustainable hydration solutions, Borosil is also uniquely positioned to capture significant growth in this category. Borosil is proudly aligned with the Make in India vision, backed by state-of-the-art manufacturing facilities, which include the 84 tons per day opal glass and new 25 tons per day Borosil pressware units. By manufacturing locally, we ensure superior quality, faster delivery, and cost efficiency while strengthening India's industrial ecosystem.
These investments drive regional job creation as well as substantial economic growth. Our Great Place to Work certification underscores our strong leadership, inclusive work culture, and focus on performance. We attract and retain top talent by fostering innovation, ownership, and long-term commitment. IESOP 2020 scheme actively rewards high performers with fresh stock options also approved in November 2024. By offering equity participation, we boost motivation, deepen alignment with our vision, and strengthen Borosil's position as an employer of choice. Borosil's extensive omnichannel strategy, which spans general trade, modern trade, e-commerce, and B2B as well as export, has ensured deeper market penetration. With products available in over 24,000 retail outlets, we've built a robust, diversified revenue base that connects both urban consumers as well as rural markets. Our marketing engine has amplified brand leadership through impactful, content-led campaigns and strong digital engagement.
By blending storytelling with immersive brand experiences, we have expanded our reach and relevance. Media visibility, strategic partnerships, and our core focus on quality continue to power Borosil's growth and consumer trust. With that, I would like to end my opening remarks, and I am open to questions from the floor. Thank you.
Thank you. We will now begin the question and answer session. Anyone who wishes to ask a question may press Star and 1 on their touchstone telephone. If you wish to remove yourself from the question queue, you may press Star and 2. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we'll wait for a moment while the question queue assembles. The first question is from the line of Dhaval Shah from Girik Capital. Please go ahead.
Yeah, hi. Now, Audubin? Hello.
Yes, please. Go ahead. Hello.
Mr. Dhaval? So here I've disconnected. The next question is from the line of Resham Jain from DSP Asset Managers. Please go ahead.
Yeah, hi. Hi, Shreevar. Good evening. Good afternoon. I have three questions. First one is with respect to the Borosilicate plant. If you can just help with the overall utilization level and compare it to our initial expectation about margins, where are we? Also, what is the total capital employed in the Borosilicate plant? You mentioned in your opening remarks that the inventory levels have gone up in the Borosilicate, both at the finished goods level and at the raw material level.
Yeah. So thanks for the question. As far as capacity utilization of the Borosil plant, we are running at about 65% at the moment for the previous period. To give you some numbers, our plant is 25 tons per day, and I would say that we are about 65-70% utilized on that plant. We have taken a very stretched target that we should go to closer to 90-95% in this current period, which would be a very good success and which would therefore improve the ROCE quite well. Coming to the next point, you mentioned about, I guess, the total capital employed or the margins. Both of these I will take. The margins have been actually better than what we had anticipated in Borosil pressware.
We have quite—I do not share the margins by category, but we are quite happy with them that we have been able to expand our revenue by glassware by 25% or 27%, as I shared, and we have not really had any challenge on the margin front. In fact, margins have only increased. The import substitution has really worked for us well. On the capital employed altogether, it is roughly INR 200 crores on the Borosil front on the pressware, which includes the CapEx as well as probably some working capital that we have. That is roughly it. I mean, frankly speaking, this plant at full capacity utilization should deliver ROCE more than 24% that are working.
Okay. Understood. The second question is on vacuum flask CapEx, which you have announced. What is the kind of turnover you can get in this CapEx through this CapEx?
Yeah. So actually, glass is a tough one where you get 1:1, 1.2:1 kind of turnover to CapEx ratios. In the case of steel, it's a bit different. In the case of steel, you can get two to three times, depending on product mix, CapEx to turnover ratios. If it's a INR 40 crore CapEx, you could probably do about INR 100 crore of revenue from that.
Okay. Got it. The last one is with respect to the working capital. Last year also, we had an increase in working capital. In September, we mentioned that because of festive and because of regulatory on the flask side, we bought more of the Hydra range. It seems that this year also, there has been overall further increase in the inventory level. On an aggregate basis, how much inventory can be reduced in a normalized environment? If you can just give your thoughts around that, because it is maybe temporary, but it is slightly on the higher side.
I'll give you an example. In opal glass, we don't have inventory of more than 60 days. 60-90 days would be the inventory range that we would operate at. Obviously, during Diwali, it comes down. In the middle of the year, meaning towards March, it goes up. The range would be maybe even 45-100 days. That would be the broad range of opal glass inventory. That's because it's a stabilized environment. We have our own manufacturing. We don't import anything. It's quite stable for the last many years. I'm seeing it. In the case of, as you rightly mentioned, the regulatory issues, we had two consecutive years with regulatory issues. Last year, it was the BIS on the vacuum flask, which is our Hydra range. This year, now we got BIS on appliances.
We had two consecutive years with two separate product categories which are being imported, which have these BIS notifications, in which case we had to stock up for six-nine months. In these categories, our inventory has gone to 180-210 days, maybe even 270 days in some cases, while we develop the local vendor ecosystem, right? That is a separate issue. This number, if I remember correctly, could be as high as INR 80-90 crore, maybe even close to INR 100 crore of extra inventory we are carrying because of this reason. As far as Borosil is concerned, the issue is completely different. As Anand Sultania mentioned, our production capacity was three times what we were selling. We have not yet—obviously, our sales have increased substantially this year, but they are not yet caught up to the production capacity.
Therefore, and the glass plant, you have to run at full output. You can't really run at lower output. We have to stock that material. To answer overall questions, say in a couple of years' time when the BIS issues are solved and our glass plant is running at full utilization, I would say inventory would be similar to what our opal glass inventory is, between 45-90 days, depending on the time of the year, just before Diwali, just after Diwali will come down, and then maybe by March, April, it will go up to 90 days. That's broadly how it will work. Whether we can further tweak from there, that's something we'll have to look at there. I think that would be a good internal target to us.
Understood. Is this the peak inventory which you're carrying?
Yeah, yeah. That's a fair assumption. March is anyway peak inventory, more or less for us, because that's just how the market works. March, April, May, these are the three months where probably—and then the sales pick up from June, July onwards. Yeah, I mean, given these two years, in addition to the March peak, we've had these two BIS peaks, which have really increased our costs or increased our inventory carrying costs. Yeah.
Okay. Understood. Thanks, Shreevar. All the best.
Thanks.
Thank you. The next question is from the line of Dhaval Shah from Giriq Capital. Please go ahead.
Yeah, hi. Sorry, my line got disconnected. Yeah. So my question is regarding this board resolution for INR 250 crore fundraise. Could you give out some details on it? What is it regarding? What is it called?
It's an enabling resolution. We take it every year. Because in the past, when we had to raise money, then we could raise because we then had to go for an EGM. It's an enabling resolution. We are not at the moment planning to raise any money.
Okay. So now I have to ask that, weighing a rights issue versus a QIP, because we've just done a dilution. Yes, and both will lead to a dilution, though. Won't that be a better option? Any thoughts?
As I'm going to repeat myself, it's an enabling resolution. There's no thought on raising money at all, whether it be rights or whether it be QIP. I mean, the secretarial department took it in the due course of business. Don't read into it. I'm pretty sure we'll not be raising any money this year, unless something dramatically changes. It's a moot point. It's a moot point.
Okay. Got it. Thank you. Yeah.
Thank you. The next question is from the line of Bhavin Rupani from Investe c. Please go ahead.
Yeah. Hi, sir. Good afternoon, and thank you for the opportunity. My first question is related to Hydra category. Sir, we did some channel checks around Hydra, and what we observed is we have introduced a new scheme for stainless steel single-wall bottles in the market. How should one understand this more, sir?
Look, there is a—what you know, as I already mentioned, our brand stands for sustainability and for daily use. The Hydra insulated flask costs anywhere from INR 700-INR 900 plus. Entry-level means slightly lower, but that is broadly the average pricing. That is for many kids, for many kids and for other socioeconomic classes, that the price point is a bit high. People use plastic bottles, which are maybe priced much lower. The idea of a single-wall steel bottle is to enter into categories where the investment cost of INR 700 is too much because parents may not want to spend so much money for their kids' bottles, for school bottles, and so on. This is just a way of expanding our presence in those areas. That is a thought behind it.
Besides, the production capacity in India for this product is quite good, and we can assure a Borosil type quality for the end customer. It makes sense as a line extension to do it.
Clear, sir. Second, which is a follow-up to the above question. When we did the checks, we understood that some of our Hydra products have now started to deplete. Inventory has now started to deplete. Availability of some of the products is an issue now. Can you give some more sense on how much inventory we have, and do you think it will have any impact on revenue or margins in Q3 and Q4 until the new plant is commissioned?
Yes. There is an absolute issue of that. I think in the last call, I also mentioned it, that this year will be a tough year, maybe a tough year. Obviously, we're trying to mitigate it. We have a major risk for running out of inventory in Hydra without having sufficient local sourcing available to supply. And that's a risk to our revenue and to our margins, absolutely. So we are working on mitigating that risk. We do have INR 150 crore plus of inventory, if I'm not—at sale value—to mitigate it to some extent. But we are still not covered with the whole year's inventory. So we are working on it. Everything is not known today, but we will certainly try and reduce the loss of Hydra sales this year to the minimum issue as possible.
Sir, you mentioned about INR 150 crore inventory. This should last for next six, seven months or nine months?
I think so. I think we'll have enough to pass Diwali.
Got it, sir. Sir, second question is related to our expenses. Our warehousing expenses and freight cost, as we understand, and A&P cost is higher as compared to some of our peers in the industry. What are your thoughts on this, and how do we try to balance revenue growth and higher overhead cost?
I'll say, look, we have a very clear philosophy. We want to expand our revenue growth, okay? In order to expand revenue, you need to be—you need to have your product in front of the customer. You need to have product available, meaning the customer—it should be in the consideration set of the customer. Whichever channel they are looking at, whether it be trade online, offline, they have to see our brand. Secondly, from a retailer's perspective, you need to be able to replenish the inventory as quickly as possible. On both these perspectives, our goal is revenue growth. These costs are something which, okay, in the short run, may look higher, whether it be advertising or whether it be freight and warehousing. In the long run, these costs will rationalize themselves as the volumes increase.
There is a lot of operating leverage possible here. As a company, we can only solve for one thing at one time. It is not very easy to solve for everything. Our focus is on increasing our brand salience, our distribution in terms of number of stores, in terms of presence across the breadth of the country, as well as making sure our channel partners are happy with our service. We will worry about those expenses maybe two to three years down the road when we hit a certain reasonably large revenue number. If it is slightly higher than what the market average is, we are okay with it.
All right. I've got it. And sir, last question, any guidance on revenue, margins, and CapEx for FY26?
As far as, like I said, we don't give guidance for short run. We still maintain, if you see a slide—I'm not sure which slide number on our presentation—you'll see the CAGR of the company for the last 9, 10 years, where the CAGR has been about 20% or plus from 2016. I'm not sure which slide number. It's upfront. Yeah, the sales CAGR, I just saw it. From 2018 to 2025, it's about 23.5%. We've always guided for CAGR of between 15%-20%. I think this year will be challenging to maintain that, just because of the—mainly because of the QCO, the BIS issues, both on appliances as well as Hydra. On the bright side, we still have capacity in Lara, as well as a lot of capacity in borosilicate, which can cover that.
We are looking at as if we may have to have some actually reduction in revenue in the categories of at least Hydra and maybe a little bit in DAP in domestic appliances. This year, I would say, would be a tough year for us from a revenue perspective. I think it's a—obviously, we are trying to do things to mitigate it. I think it's a bump in the road because from next year, again, we'll have enough capacity and more to service the market. Yeah, I don't want to give a guidance for the year, but I will say that we maintain our 15%-20% CAGR over the next three, four years from here through 2030.
Got it, sir. Thank you so much and all the best.
Thank you. The next question is from the line of Rakesh from Nine Rivers Capital. Please go ahead.
Hi, sir. Thank you for the opportunity. It's a one-way question with respect to the cash flow. There's a drastic increase in the trade payables and other payables. Can you please talk about that? What is that line item?
Here, repayment of loan. This trade payable, basically the repayment of loan to Borosil Scientific Limited, INR 100 crore. This repayment is on account of demerger. At the time of demerger, we decided to give INR 100 crore to Borosil Scientific Limited. That repayment has happened during the year.
Okay. Thank you, sir. That was very helpful. Sir, with respect to the working capital cycle, you mentioned last two years have been very difficult for the business because of the BIS implementation. Assuming next year will be smoother, what can be the working capital guidance for the number of days? Because in the past, the number of days are very low.
I think working capital will be discussed.
We discussed about the inventory.
The inventory is the main conduit. Receivables are well within control. Payables are well within control. It's all inventory. Already in the previous 30 minutes, we've spoken a fair bit on inventory, so I don't want to repeat it.
Sure. Thank you. Thank you, sir. And sir, with respect to the CapEx plan, any plan for increasing the capacity in the opalware? Because if I look at the potential, if I look at the growth of the company in the last one to last couple of years, it has been north of 20%. If we do the revenue in 2026, 20% growth or something like that, then next year we require some new CapEx in the plant. Any plan for that?
No. We are going to be putting a new plant for our stainless steel vacuum plant, which is a CapEx of over INR 400,000,000. There is regular maintenance CapEx, which may happen, which would not be a lot, maybe INR 200,000,000. That is the only CapEx we have in this particular year. We do not have current plans to either start a new third opal furnace or another borosilicate furnace. That plan, we will announce whenever it is approved by the board.
Okay. That's it from my side. Thank you and all the best.
Thank you.
Thank you. The next question is from the line of Akshat Mehta from Seven Rivers Cap Holdings. Please go ahead.
Hello. I'm Arjit.
Yes, please.
Sir, my first question was, if you can help us, what is the ongoing current environment on each of the segments in the industry for glassware, for opalware, and non-glassware at the moment?
Rituraj, are you on the call?
Yes, you're high on there.
Maybe you can take this.
Yeah, sure. I think let's go category-wise. For us, in terms of glassware, like Shreevar was mentioning, we had a very good run this year. We were able to expand the category and the market, primarily on account of having the new BG3 furnace coming in. We could come out with a lot of new products in terms of the lunch box and all, which has done very well for us. For the other categories, opal also, we had a growth of 8%. Here also, we have been able to come out with new products in terms of premium, high premium range before we launched. For stainless steel and appliances, we have maintained a growth of about 17% for the year. For us, again, we have been able to expand our distribution network.
In terms of our offering, the product hopefully also we have been able to expand, which helps us to grow. In terms of geopolitical situation and the overall environment, the markets are being tough. I think we have been able to, in terms of our offering and the way we have segmented the market, so channels. For example, we may have suffered in the B2B segment due to the government policies. For example, pharma, we suffered, but we were able to make up in the spitfire channels where we had tremendous growth. In terms of our challenge strategy, that has helped us to guide the market. Overall, the market conditions and the environment continue to be a challenging environment. I think going forward, we expect things to get better.
Anything else you can help us access for this INR 40 crore that we are going to spend on the bottle capacity? What is the other CapEx that we can expect in the year?
I already mentioned we have about INR 200 million of maintenance CapEx which happens every year. So that's it. It could be.
Just that.
Yeah.
Secondly, sir, if you can help us, what is the current utilization that we are running on in the opalware capacity? Is there any plan in the next one or two years to set up additional capacity?
Okay. So many questions are repeated, but I'll answer it again. As far as plans to set up additional capacity, no, we do not have any plans to set up additional Opal capacity. As far as Opal utilization is concerned, we are at about 90% utilization.
Okay.
Thank you. Before we take the next question, we would like to remind the participants to press star and one to ask a question. The next question is from the line of Ritesh Shah from Invest ec. Please go ahead.
Yeah. Hi, sir. Am I audible?
Yes, please.
Yeah. Hi. A couple of questions. First, Shreevar, you indicated on appliances. Basically, that's also attracted BIS. Possible to quantify what was the revenue contribution from appliances this particular fiscal? And what are the mitigating variables that we are working on right now, including outsourcing partners?
Appliances, I mean, personally, I do not share the exact numbers, but of the non-glassware, it is a reasonable chunk. It is a triple-digit chunk of the non-glassware. It is large enough that it matters. I would say that it is a different kind of discussion compared to Hydra or compared to Flask. Appliances, we have seen some good local manufacturers spring up who are OEMs. We do expect that we should be able to mitigate the challenge from BIS in a better way than has been the case for Flask. I do not sense that we will have too much of an impact on revenue growth in appliances because, as I said before, we have also covered with inventory, and we also seem to have a reasonably good supplier base which can take over the load from our imports.
As far as the quantum is concerned, we do have about INR 70 crore-INR 80 crore extra inventory in appliances for the BIS issue. I see that carrying us through at least Diwali. I do believe that we shouldn't have any kind of setback there.
Just a clarification, INR 80 crore is purely from the inventory that we have, which will help us to take care of things until Diwali?
Just extra inventory. Extra over and above normal inventory.
Okay. That's perfect. My second question was on distribution. Can you highlight the measures? What are our targets, the count right now, and where we aspire to be in, say, a year out or three years out?
I'll let Rituraj ask that question.
Yeah. In terms of distribution, we have about 24,000 retail outlets as of date. The way we look at this thing is not a specific number and all. Essentially, we look at what the current offering is and how best we can serve the end customer. We have implemented sales automation tools wherein the channel's efficiency and productivity is what we are looking out for. Typically, every year, we have been increasing our width of distribution also because of the culture of the depth of distribution. We believe that every year, we have been adding a sizable number of retailers and distributors to the thing. From the current 24,000, this number will again surely go more than about another, I would say, depending on the category, this will get scaled up.
Sure. Last question for Shreevar. Sir, earlier we have spoken about one is ANP spends. Secondly, it is warehousing and freight. I think you had indicated that we were looking to rationalize something on the warehousing because it was a variable wherein we were looking at turnaround time versus actual cost. Any progress on warehousing, freight cost, and the third is basically the efficiency on ANP spends? Any numbers for ANP spends specifically for FY 2026?
No. I think in the opening remarks, I mentioned that ANP went up more than expected this year because we had to pivot because our B2B sales to pharma came down, and we had to pivot to other channels this year. Therefore, ANP went up. That was unexpected in the middle of the year to have that, but we had to do it. These things happen during the year. We expect something, and we have to kind of move quickly when things do not work out in the way that we anticipated. Coming to your question, as I mentioned again before, these are indicative numbers. At INR 1,000 crore or INR 1,100 crore of revenue, I do not think it really matters that whether your percentage is 7% or 6% or 8%. What matters is, can you grow the INR 1,100 crore to INR 2,000 crore in the next three, four years?
Once we hit that kind of scale, I believe that these numbers will automatically rationalize. For example, and there is a reason for saying that, is when you, for example, do INR 2,000 crore of revenue, the number of trucks you send to your distributor increases. When that increases, you are able to replenish them faster. You do not need warehouses in every part of the country. Therefore, you can ship directly from central warehousing more, as an example. In the same way, your freight, you ship more truckload than container load shipments are lower, which is also cheaper. Those things automatically happen, and you do not have to actually work on it. It is just by function of volume that you get those savings. Of course, advertising is one where it is up to us.
I mean, many of the e-commerce guys spend a much larger % on advertising to increase the pie. We spend lesser, and our competitors spend even lesser than us. It is a question of your philosophy. Right now, our philosophy is to keep increasing top line and obviously without giving discounts. That is where the advertising comes in, is that you prove to the customer why your brand is better rather than give a discount and increase revenues. Directionally, you're right. We have said in the past many times that these numbers will rationalize. When exactly it happens, it is hard to say. Market keeps changing. I do believe in the next two, three years, these numbers will rationalize and will add maybe two, three, four.
I would say 2%-3% would be added to EBITDA with the rationalization of these numbers over the next two, three years.
Sure. That's helpful. Thank you so much. All the very best. Thank you.
Thank you. The next question is from the line of Pranay Roop Chatterjee from Burman Capital Management. Please go ahead.
Good afternoon, sir. My first question is on your Flask, and I'll try to be as less repetitive as possible. Most of my questions were covered anyway. On your INR 40 crore CapEx, you mentioned that the turnover would be about INR 100 crore. Based on my understanding of how much revenue comes from Flask in your non-glass segment, I don't think INR 100 crore would cover the entirety of it. Am I missing something here? What is your sense? How do you plan to cover your entire current revenue base of Flask basically now? Earlier on in the call, you mentioned that there could be a revenue risk, and you are trying to mitigate it. Can you possibly share some of the mitigation strategies that you work, even if it is at the idea stage for the Flask category in H2?
Yeah. So yeah, I think your observation is absolutely spot on. The INR 100 crore will not be enough to substitute the entire sales of our flask. That is a good observation you have. There are two answers to that. Number one is this is a starting point. We will have space to double our capacity very shortly thereafter. That CapEx will not be anywhere close to INR 40 crore because a large chunk of this is spent in infrastructure, your setting up the place. The machines themselves may only be 30-40% or 40% of this. To double the capacity will be only 40% of the cost, roughly. As a first step, we do this, and the second step will be doubling. Obviously, that will take some more time. In the interim, we also have, it is not that we have zero suppliers in India.
We do have a reasonable supply base in India, and they have also been ramping up. Once our own capacity and the suppliers' capacity come together, I think that will definitely happen sometime in this year. In the interim, we may suffer some revenue loss. I'm not able to quantify it because, like I said in the other question, what are the strategies? There are a few. Obviously, keeping stock is one. Working with our current suppliers in India to expand their ability to supply, actually going to their plants and helping them de-bottleneck their plants, those are things that we have been trying to do. They are showing some positive results, but it's too early to say that we'll be able to replace the entire sale this year.
From next year, I think that challenge should be reasonably under our control.
Perfect. My second question is on Opalware. I presume that the lower growth this year is also because of the void in your B2B channel. Is it a fair estimate to say that we'll have to wait for two more quarters till the missing B2B pharma piece comes into the base where we start seeing growth again? Is that a fair statement?
Yeah. We lost about INR 300 million this year on B2B in opal. That was a big setback for us.
Got it. Okay. On Milton, any update on their entry into the segment? I was receiving some feedback that the amount of promotional activity or discounting in the industry has not worsened, but maybe some of your peers, the discounting or promotional activity has increased. Is that your sense as well? Any update on the new players?
Frankly, my job is to do, or rather my team's job is to do what we can do. We do not keep tabs on exactly what is happening with the players. I can't give any comments on that. As far as discounting, of course, we do keep tabs on because that impacts our pricing. As far as that is concerned, we have seen some higher discounting. I don't think it's a big issue in the sense that I don't believe that that's a reason for us not to be able to achieve our goals. People are free to do whatever they like, and we have to do what we think is appropriate. We have been launching premium categories at even higher prices, and it's a differentiated product, and that's getting a lot of traction.
We have been playing with our product mix to see what other value additions we can do. We have been innovating on colors, for example. There is a lot of innovation happening. I think the moment you have that, then it is not relevant. You spend money to convince the customer that this is the right product for them. I do not think for INR 5, INR 50, you are going to lose the customer because someone is getting INR 50 cheaper. I do not believe that discounts are going to drive down our margins. I think our margins will be driven down by our own, or rather, by our own activity or inactivity or our own understanding of the market. I am not too worried about the margins.
Got it. Clarification on the inflation number you mentioned, 90% in opalware. Is it for FY2025? Okay. I'll tell you what I'm trying to do. I'm trying to gauge if theoretically in FY2026 blended, you reach 100% util. Would your revenue peak on current capacity be around INR 430 crore-INR 440 crore? Is that a fair number?
Yes. That's a fair number.
Got it. Finally, a housekeeping question for the CFO. There is a line item. I'm sorry, there was some discussion on loans, but I'm not sure if it's related to that. There is another current financial liability item. It was INR 2.15 billion last year, and in FY25, it's come down to INR 1.09 billion. I think that has impacted your cash flow from operations as well. Is it possible to break down what has gone down here exactly?
That was because, yeah, please go ahead, Rajesh.
Sorry, go ahead, Rajesh.
Yeah. Last year, there was a scheme of arrangement by virtue of which probably about INR 100 crore were supposed to be paid to Borosil Scientific, which has been paid during this financial year. That has reduced by about INR 100 crore.
Oh, it had to be paid. Hence, it was a reinforcement liability. Got it.
That's right.
Thanks a lot, sir, and all the best for the upcoming year.
Thank you. The next question is from the line of Hitesh from Kosha Capital. Please go ahead.
Hi. Thanks for the opportunity. Mr. Shreevar, this year, our growth is largely driven by glassware, right? Glassware segment grew by 27%, and our overall revenues grew by 15%. Any price action that we had to take because of our capacity in pressware that came up during the year? Did we take any price action here to drive this growth?
Yeah. I think we had thought we may have to. In fact, if you go through previous recordings, I had mentioned that we may have to drop some prices. In fact, we have not materially moved any price. If any price action, it would be within single-digit percentages, 5% minus maybe. We did not, in fact, have to sacrifice pricing for volume growth in this previous year. Yes, I hope that answers your question.
Sure. For the next year, when we are trying to hit a 90% utilization, do you think we'll probably maintain our prices? What is your thought on the pricing to hit this 90% utilization? If at all there's no price action, then you think margins could be positive? There could be a positive impact on the margins because of this ramp-up?
To answer your question, obviously, we would prefer that we go to the full utilization with our price. That is plan A. Obviously, as a company, we have to look at plan B also. Plan B, we have taken that we, again, may have to drop some prices maybe in exports or in some other areas to utilize the entire capacity. While we are working towards plan A, we have plan B in the back pocket. Specifically, if we are able to use the full capacity at this price point, what we already have established in this year, then it would be a substantial improvement. I am seeing substantial improvement in our margin profile. That is obviously the best goal or the best outcome for us.
The only thing, as I also mentioned, which is not related to Borosil at all, this year, we may have some impact on margins because of the lower sale of Hydra. If at all, we can't get the product from somewhere. We will try, and towards the end of the year, we will try from our side to explain what has happened, where margins are being driven from in a better way. People will understand that. I hope I have been able to answer your question.
Sure. Yes. Now coming to the Hydra, I see that the prices have already moved higher by 15% for all the players. At least this is what I see on the e-commerce platforms. This inventory issue that you are talking about, is this for all the players, or is it specific to us? I believe everyone is going through the same BIS challenges and the implementation of projects. If at all, there has been a price increase, which at least I see on the platforms, then the margin should not get impacted. Maybe your revenue gets hit to some extent, but margins should not be that impacted, right? I mean, what makes you believe that the margins will get hit?
Yes. Clarify. Gross margins will not be impacted because of what you just mentioned. Net margins, because we have overhead growth, so if the revenue falls, the overhead gets distributed over a lower base, right? The margins may be impacted because of that. You are absolutely right. Gross margins will not be impacted. If anything, they will actually increase.
Sure. Got it. My last question, again, coming back to glassware, of these INR 250 crore, how much is coming from our borosilicate freshware products? Could you share that?
I don't share that data, but now it's a large chunk of it. I can't give you an exact.
Okay. Great. Sure. Sure. Thanks.
Thank you. The next question is from the line of Harshit Nagpal from Yes Security. Please go ahead.
Yeah. So just a quick question if you share the data. What would be the e-commerce sales for the glassware and non-glassware segment for us? If a ballpark figure you could give to that.
Sorry. I don't share this data by channel segment.
Okay. No problem. Thank you and all the best.
Thank you. Ladies and gentlemen, as there are no further questions from the participants, I now hand the conference over to the management for closing comments.
Thank you all for your involved discussions. Really appreciate it. Thank you for your interest in our company. We've had a very good many years now. This year seems to be a bit tougher, although I think my entire team is very motivated to find solutions, which I expect that we will. For next year, I think we'll be back on our growth path for sure. Our desire to grow between 15%-20% year- on- year remains unchanged. So far, we've been outdoing that, and hopefully, we can continue doing that. Thank you again for all your support, and I look forward to interacting with you in the future.
Thank you. On behalf of Borosil Limited, that concludes this conference. Thank you for joining us, and you may now disconnect your line.