Ladies and gentlemen, good day and welcome to the EID Parry India Limited Q4 and FY2025 earnings conference call hosted by Dam Capital Advisors Limited. As a reminder, all participant lines will be in the listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during this conference call, please signal an operator by pressing star then zero on your touch-tone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Sanjay Manyal from Dam Capital Advisors Limited. Thank you, and over to you, sir.
Hello everyone, and warm welcome on behalf of Dam Capital to the Q4 FY2025 earnings call of EID Parry India Limited. We thank EID Parry's management for giving us this opportunity to host this call. On the call today, we have with us Mr. Muthaiya Morghupan, Whole-time Director, and other senior management team of EID Parry. I hand over the call to the management for opening remarks, followed by a question-and-answer session. Thank you, and over to you, sir.
Good morning, Sanjay, and thank you. Good morning, everyone. It gives me great pleasure to be a part of this call to share with you and update all of you on the global as well as the Indian sugar scenario, and also talk about the Q4 performance of the company. I'll start with the global scenario. The 2024-2025 global sugar deficit widened by 1.5 million tons to 3.9 million tons due to production cuts in India, Pakistan, and Thailand, while the 2025-2026 deficit projection increased to 1.5 million metric tons, signaling continued tightness. The 2024-2025 raw sugar trade flow surplus rose by 726,000 metric tons to 2.92 million metric tons, with most of this concentrated within Q3 of 2025.
The projected trade flows for white sugar in 2024-2025 indicate a reduced surplus of 642 K metric tons, down by 215 K metric tons, amid a shift to a deficit starting in 2026. The benchmark New York No. 11 May contract oscillated between 18-20 cents per pound, finishing the month 44 points higher. The weather forecast shows above-average rains in Center and South Brazil. In the short term, this could disrupt harvesting and reduce industrial yields, but in the long term, it could be beneficial for cane development. The US Dollar Index fell significantly by mid-March amid tariff concerns, which could influence agricultural commodities, sugar included, on the bullish side. The speculator's net stock position was reduced to the lowest level since mid-December 2024, mostly on fresh pine.
New York number 11 price forecast has been lowered from March 2024, with the base case at 18.5 cents per pound. To attack demand, a major significant surplus estimated in raw sugar trade flows. White premiums remain volatile, ending April 4% lower, with expectations to trade between $105-$120 per metric ton, reflecting the tightening white sugar surplus. While structural deficits provide long-term price support, near-term market dynamics remain balanced between Brazil's harvest progress, white and raw arbitrage opportunities, and evolving weather patterns that could impact production. The market continues to navigate these competing forces, with traders closely monitoring Brazilian flushing rates and potential policy shifts that may affect global trade flows in coming months. I'll now move to the Indian scenario. As of April 30, India's sugar production stands at 25.7 million metric tons, with 19 mills still crushing, predominantly in Uttar Pradesh, Maharashtra, and Tamil Nadu.
While early season yields were impacted by weather conditions, improved recoveries on the back half of the main season have supported production. ISMA, the Indian Sugar Mills Association, has maintained its full-season estimate of 30.3 million metric tons, contingent on an additional 4.5-5 million metric tons from the May operations and the special season, which goes from June to September. Domestic consumption is projected at 28 million metric tons, with 1 million metric tons being allocated for exports. 3.8 million metric tons have been diverted to ethanol production. On the back of this, closing stocks estimated at 5.5 million metric tons for the sugar year 2024-2025. Looking ahead, with planting numbers looking good in the three key states and a normal monsoon, which has already started early, expected this augurs well for the upcoming main season crush.
Nadu and Andhra Pradesh, however, still will remain challenged because of lower planting. Given this, or given that there will be a positive delta in crush, there is expected to be more sugar in the domestic balance in the upcoming sugar year. On this backdrop, some of the key factors to be monitored from a policy and a regulatory perspective include, firstly, sugar pricing as the new season starts and as to whether exports will be considered given a larger crop and crush. On the ethanol side, we also need to monitor whether on molasses-based ethanol, whether there will be any pricing revisions at all, as they have not been moved up in over three years despite consistent FRP increases. There is also an indication of more saliency and emphasis on grain ethanol.
Lastly, on ethanol, whether there would be curbs or not on the import of US ethanol will also need to be monitored. Whether the curbs will be lifted would need to be monitored as part of the ongoing trade discussions between the two countries. I now hand over to Venkat, our CFO, to take you through the operating parameters and performance of the company in Q4 and FY2025. Thank you. Thank you, Muthu, and good morning to all participants. It's a great pleasure to be part of this list call and to share the key information of the operational and financial performance of the company. I would like to share with you the key operating parameters of each segment. The sugar operations, the crushing operations in Karnataka, Tamil Nadu, and Andhra Pradesh, we have successfully completed for the quarter.
We have run about 122 days overall in Q4 against the 156 days of last year. We crushed about 1.74 million metric tons of cane against the 1.979 million metric tons for the corresponding previous quarter. The gross recoveries are improved. We are at 10.89% for the quarter against the 10.69% corresponding to the quarter of the previous year. We produced about 155,000 metric tons against the 204,000 metric tons of the corresponding previous quarter. Overall, cane cost is about INR 3,768 per metric ton against the INR 3,504 per metric ton of the corresponding quarter of the previous year. The increase is mainly on account of the FRP increase from INR 3,150 to INR 3,400. As far as the sugar volumes are concerned, we sold about 103,000 metric tons, including our consumer pack division, against the 105,000 metric tons of the corresponding previous year.
Average selling price was about INR 39.37, excluding the consumer pack, against the INR 37.52 of the current previous period. We carry closing stock about 1.9 lakh metric tons, and the value rate is INR 37.5-INR 38 as well. As far as the revenue is concerned, from sugar operations, we've done about INR 408 crore against the INR 415 crore of the corresponding previous quarter, registering a degrowth of about 2% as well, mainly because of an account of release quota. As far as the consumer pack is concerned, we achieved about INR 195 crore of the revenue. This is including the non-sweetener portion of about INR 65 crore, and the sugar is about INR 130 crore against the INR 135 crore of the corresponding previous period. As far as the cogen is concerned, we generated about 1,456 lakh units against 1,746 lakh units in the corresponding period of the previous year.
As far as the exports of the power is concerned, about 732 lakh units against 903 lakh units in the corresponding period of the previous year. The average power tariff for the current quarter is about INR 4.3 per unit against the INR 4.84 per unit in the corresponding period of the previous quarter. As far as the revenue is concerned, about INR 570 million for the power for the current quarter against the INR 770 million of the corresponding period of the previous year. It's a good story on the distillery because we sold about INR 389 million of alcohol against the INR 331 million later of the corresponding previous quarter, of which about INR 131 million is the ENA, about INR 257 million later is the ethanol. The realizations are good. The current quarter realization is about INR 66.98, about INR 67 against the previous year realization is about INR 64.49.
Though there is no increase in ethanol prices, the average realizations have been increased. Mainly the contribution has come from the price increase in ethanol in Tamil Nadu and Karnataka. As far as the revenue is concerned, about INR 268 crore against INR 224 crore of the corresponding previous year quarter. As far as the neutral segment is concerned, the Indian operations current quarter turnover was about INR 9 crore against INR 10 crore in the corresponding period of the previous year. At the consolidated level, the turnover is about INR 60 crore against INR 70 crore in the corresponding period of the previous year. As far as the refinery business is concerned, the gross total revenue is about INR 1,019 crore against INR 899 crore of the previous period. As far as the loss is concerned, about INR 99 crore against INR 9 crore in the corresponding previous period.
Refined sugar production is about 1.17 lakh metric tons against the previous period, 2.49 lakh metric tons. Refined sugar sales is about 2.05 lakh metric tons against the previous period, which is 1.5 lakh metric tons. The inter-corporate deposit, which is given by the INR 200 crores by the EID Parry, remains the same. As far as external borrowing is concerned, about INR 59 crores against the previous period, which is about INR 95 crores. As far as EBITDA is concerned, for the current quarter, it's negative, about INR 38 crores before exception, about INR 38.12 crores against the corresponding previous period, which is about INR 56.21 crores as a profit. EBIT before exception will be about INR 49.31 crores current quarter. Compared to the previous period, it is a INR 45.53 crores profit. PBT is about INR 99 crores negative against the INR 90crores of the corresponding previous year as the loss.
That's it from my side. The floor is open for the questions.
Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on the touchstone phone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to raise their hands as well as 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 Rushab from RBSA Investment Managers. Please go ahead.
Hello. Yeah, good morning. I just have a question on the EPG division on the non-sweetener side. Strategy-wise, are you looking to enter this organic or chemical-free category seriously over the next two to three years? What is the thought process given that we have good access to farmlands from our group companies?
Hi, Rushab. This is Balaji. I head the consumer products business. As of now, we are present in the conventional staples business, and we do not have any plans right now to enter the organic or the chemical-free staples at this point in time. Maybe at some future situation, we will consider it. We have not yet optimized the supply chain to the extent of going up to the farmers. As of now, there are no plans for that right now.
Secondly, I'm just looking at one of your slides in the sweetener category. The distribution reach has increased by 10X over the last four years, while the revenue has gone up only 3X. I believe there's a lot of potential to increase the revenue per distribution reach. What steps are we taking to increase that? What are the new products that we're adding in the non-sweetener category in this coming year?
I think the outlet increase is always higher than the revenue increase because the incremental new outlets do not contribute to revenue in the same proportion as the existing outlets, which is a normal understanding. That is the reason why you see that discrepancy. In terms of new products, we are still working on our new product plans, and we will come back to you as and when they are ready.
Okay. Thank you.
Thank you.
Thank you. Ladies and gentlemen, to ask a question, please press star and one at this time. I repeat, participants who wish to ask questions may please press star and one at this time. We take the next question from the line of Sanjay Manyal from Dam Capital. Please go ahead.
Hi, sir. Just want to understand about the availability of sugarcane for the next season, given the fact that the rains have been good and the water levels have been pretty decent. What it seems is that production could be a bit higher. What could be the crushing number for us, and how would that translate into the ethanol volumes for the next year?
Good morning. This is Ashik here. I'm heading the sugar and biofuel business. Current timely monsoons in Karnataka and Tamil Nadu is giving us a lot of comfort. We are still in the stage of planting progress. Probably by end of next quarter, we'll have a good view of any upsides that could be there. Currently, we are holding a neutral outlook with a positive bias.
Okay. Okay. Sir, just also want to understand if you can give some bit about the ethanol volume and how much now could be the proportion of grain ethanol or maize ethanol, and how are the economics in maize ethanol and, for that matter, grain ethanol in South India?
Sanjay, because as far as if you look at our capacity, distillery capacity is about 582 KLPD, so that will give you about INR 1.8 billion liters as well. Okay? As far as the composition of ethanol and ENA is concerned, it will be dynamically we'll be deciding it, which is more lucrative. Okay? As far as the ethanol is concerned, to the extent of the OMC commitment, we'll be honoring it. Balance, we'll be diverting it to the ENA. As far as the grain is concerned, you are aware of it because we have only one facility at about Andhra Pradesh. That is about INR 350 million-400 million liters it will produce. That also depends on whether it is a syrup or the grain or something. It's a multi-feed distillery. We can't comment anything on that. On the 25, 26 what could be the grain exactly depends on the availability of the cane and the government outlook on the price increase in case of ethanol and the behavior.
Sanjay, going to your question, in terms of the economics of grain ethanol in South India, I think it's helpful for the economics when you actually have an integrated facility because your sugarcane ecosystem gives you a benefit on fuel. Ideally, we have had lower than expected cane feedstock in Andhra Pradesh. As that situation improves, that would certainly benefit the operations. In terms of how standalone ethanol display are faring in the south, there isn't too much public data available on that, so it's hard to comment. In a broader sense, we are hearing more saliency and emphasis on grain ethanol. This is a change from when the Ethanol Blending Program was conceptualized. In the last two and a half years, there's been more of a saliency towards grain, which is what we are seeing right now.
That said, we are moving into a period of abundance on the sugarcane side after two years. Given all of these are agri feedstocks, we will have to wait and watch whether this increased saliency towards an emphasis on grain ethanol will remain or there will be a shift towards sugarcane. Again, given these are agri-based feedstocks, these tend to usually be dynamic situations.
Right. Right. So just one more thing on the ethanol part. This is almost like a second year where we haven't really received any hike in ethanol prices. What does that mean? I'm sure your discussions must be happening with the government about the policy because till the time the 20% blending was not met, I think government was pretty keen to increase the prices. Do you think it's a halt from that perspective that there is no increase in prices? Probably this 20% blending will stay here and will not move forward?
Sanjay, I think you're asking a couple of questions. I think the last time, and Venkat, correct me if I'm wrong, we saw an increase on ethanol offtake prices was late 2022. We're almost going to be three years without any increase in molasses-based ethanol prices, barring some marginal increases on the CFE price, which is not very material. That is a challenge given FRPs go up consistently every year. Last year, they actually went up by 8%. This is what has challenged the industry and also brought EBITDA margins down significantly on the back of recently concluded CapEx programs. I think this has been well represented by the industry body to the policymakers. I think they have also been receptive in their listening, and I think they do understand.
It really remains to be seen in terms of what kind of policy calls are taken around this. I can say that we remain hopeful given that there is an abundance of cane coming up and so on. In terms of the blend, I think we're up to about 18% right now. The auto industry also is seemingly prepared for up to a 20% blend. Whether this blend will move up beyond 20%, again, that's something which is on a concrete basis yet to be determined. We are also concerned, I will say, by the fact that there are conversations as part of a broader U.S.-India trade discussions that the lifting of curbs on import of US ethanol is being considered. We don't know the outcome yet, but I think the industry body has officially also expressed their concern on this matter to policymakers across the board.
I think such a move will certainly be negatively impactful to the industry at this point in time.
Right. Right. In the same context, if I can just understand the economics, what if the import of ethanol happens to India, what would be the landed price? Will it be so much difference? Is there a significant difference that those imports are attractive?
I think if you look at U.S. current export prices of U.S. ethanol, I think they would equate to about, I would say, early 40s. I did check this earlier this week. Of course, ethanol is subsidized in India, and I think U.S. prices are currently much lower.
Right. Right.
That obviously impacts.
I think the environment.
Yeah, that obviously impacts the economics.
Right. Right. Thank you. Thank you very much for that.
Ladies and gentlemen, to ask a question, you may press star and one at this time. I repeat, to ask a question, please press star and one now. We take the next question from the line of Yash Visharia from Marvara Asset Management. Please go ahead. Yash sir, you are online. You may unmute and ask the question.
Hello. Thank you for the opportunity. Am I audible?
Yeah. Yes.
Yeah. Sir, just wanted to get your sense on the consumer products business. How are we seeing this business grow over the next two to three years? What is the roadmap that the company is envisaging on this business?
Yeah. Hi, Yash. The consumer product business, we will focus on the consumer product business, will continue with sustained aggression on distribution growth and volume growth. Branded packaged food business in India is growing at about 12% annually. We will be trying to beat that estimate in terms of our growth rates. We will continue to keep focused on building the brand and driving the distribution.
Sure, sir. So are we focusing on any specific geographies like only South India, or do we want to grow pan-India? How are we seeing the growth?
Right now, we are present in the south of India. As the market demand picks up, we will be expanding across to other geographies. Right now, we are present in the south of India.
Okay. Sir, are we planning to tie up with any of the giants like, say, D-Mart or any other quick commerce for pickup in the volumes?
These are channels, and we do not do tie-ups with them. We are present in all these channels in e-commerce and D-Mart. Our products are being sold. Like a conventional channel, we will be managing them.
Understood, sir. Understood. So sir, basically, apart from sugar and distillery, can we say that maybe three or five years down the line, the consumer products business will be one of the important core segments for the company in the growth?
Yes, definitely.
Okay. Okay. Thank you so much, sir. Thank you.
Thank you.
Thank you. Ladies and gentlemen, to ask a question, you may press star and one. I repeat, participants who wish to ask questions may please press star and one at this time. We take the next question from the line of Ritviksheet from OneUp Finance. Please go ahead.
Hi. Good morning, sir. Sir, just a couple of questions. Firstly, on the debt front, sugar business and refinery, would it be possible to give the split for long-term and short-term debt?
Yeah. I think as far as the sugar business is concerned, we have about INR 850 crore as the short-term debt. About INR 205 crore is the long-term debt. As far as the refinery business is concerned, about INR 590 crore is the short-term debt. The INR 200 crore will be the long-term debt. Long-term debt is basically from the ICD, which is given by EID Parry.
Right. Right. So external debt is only INR 590 crore, which is completely short-term?
Yeah.
Okay. Sir, what is the outlook on the refinery debt and refinery business as well for FY 2026? If you could give us some flavor on that.
I have a quick. Suresh Kannan here. The refinery business went through challenging times in the second half of FY2025, basically on account of the drastic fall in the oil premiums that happened because of increased supply that came out of the European Union, Ukraine, and to some extent out of Pakistan as well. Going forward in FY2026, there is a spillover effect of that as we start the financial year. However, as what Muthu explained in his commentary, there is a tightening of the supply chain that's happening on the refinery is concerned. Most refineries took a break because of this low oil premium situation. There is a correction as far as the supply side is concerned. We are seeing the oil premiums going back.
It will not be up to the levels that what we witnessed in FY 2024, but definitely much better than the FY 2025 level. That will increase the run rate of the refining operation. That will also help us to service the short-term debt effectively.
Okay. Got it. On the crushing, I'm not sure whether you mentioned in the opening remarks, but what is the crushing that we expect for FY2026 for EID Parry?
I think normally we will not tell about the futuristic. I was asked mentioning that this time the monsoon is good. We can come back to you maybe in September or something what should be the probable crushing.
Thank you. Thank you and all the best, sir.
Thank you. Participants who wish to ask questions may please press star and one at this time. Next question is from the line of Manoj Shah from Laxgove Investments. Please go ahead.
Yeah. Thank you for the opportunity, sir. I just wanted to check on what will be the capacity utilization for ethanol because recently new capacities have come in. What do you expect in FY2026 capacity utilization?
Hi. As Venkat pointed out, we have 582 KLPD. We are currently running at about 90% plus capacity utilization. We expect that to continue. Our endeavor is to move the needle substantially up because this business, the benefit is there in utilizing our assets efficiently. We have an opportunity unlike the sugar business. 90-95% is the kind of capacity utilization we are looking at.
Okay. Regarding the sugar refinery, there is some impairment taken up in this year. Can you comment a little bit on that? Why the impairment has been taken? Also, there is some news that government will have some control over raw sugar. Also, there are some news. If you can comment on that.
I'll take the first one. There's been an infusion which has been made, and that is for debt reduction and improving the net worth. At the same time, the impairment has also been taken because of the challenged financial performance of the business. You will have seen the spread. I think Suresh Kannan spoke about it. It has drastically come down. This has led to, as Venkat described, a very weak financial performance. We were required to take this impairment.
Basically, you have assured the future cash flows to be lower than the book value. You have taken impairment based on that?
Yes. It's future cash flow-based formula which has been used. Yes.
Okay. Second part on this raw sugar, there is some news that the government would have some control over that as well. Is there some news? You can comment on that?
Suresh, you might want to comment. I'm not.
I think so. In the sugar control order, they have brought in some amount of control in declaring the raw sugar with the manufacturers. They have also brought units larger than, I think, 500 TCV for Jaggery crushing, Kandasari into the ambit. We believe both are a welcome move to make the sugar balance numbers and create a level playing field amongst various players. As an organized player, we are open to the direction in which they are moving.
I'm not sure there's much of an implication on the refinery. I don't know, Suresh Kannan, if you want to clarify.
Yeah. Yeah. Basically, I wanted to address on that.
This sugar control order is basically for governing the domestic production. The refinery is entirely on export. Either it imports through advanced license or through special economic zone. These do not come under the purview of this control order. We are exporting.
Okay. Okay. Fine. Thank you.
Thank you. We take the next question from the line of Manasvi from ICICI Bank. Please go ahead.
Yes. Please go ahead. Yeah. I would like to know for the sugar segment, what specifically highlight on what have been the key reasons because of which there has been the negative income? And how is exactly EID Parry planning on mitigating this in the upcoming financial year?
Can you stop the background noise? She's coming. We are not able to hear you properly.
One second. Is it better now?
Currently, better. Yes. Please.
Yeah.
Can you please ask your question again?
Yeah. I would like to know if we go for the sugar segment, if you can highlight what are the key reasons because of which there has been negative income for the FY2025? How is EID Parry planning to mitigate the same in the upcoming financial year for the sugar segment?
I'll try to take the question. Fundamentally, the challenge has been on sugar realization because the government has been holding the MSP while the FRPs have been going up year on year. As already pointed out, we continue to shift our portfolio towards refined sugar and institutional sales, coupled with our foray into consumer products. These should shore up the realization to help us manage the pressures on cost line. The other challenge we continue to face is on the release quota. The government has a particular methodology, and they have been refining it over years in terms of giving us a quota of sugar that we can sell. We continue to work with the policymakers in terms of helping the industry in giving higher release quota, which will automatically take care of the business pressures. The last one is obviously from the supply side.
As already pointed out by a gentleman earlier, we have a positive bias towards cane availability. An increased crush base will also leverage the cost in the P&L and will give better results. Broadly, at a large view, these are the three ways in which we are looking at approaching in terms of resolving the pressures.
Got it. Thank you.
Thank you. Next question is from the line of Yash Visharia from Mavira Asset Management. Please go ahead.
Thank you for the opportunity again. Sir, just sorry if that's a repeat question. With respect to this subsidiary, Parry Sugars Refinery India Private Limited, we have an exceptional item of INR 4.27 billion for the year of FY 2025. We are again infusing around INR 3.5 billion in the same subsidiary. Is that understanding correct?
That's correct.
Okay. Sir, what is the reason for writing off 427 and again re-infusing such a big amount in the same company?
I think Yash covered this earlier. The impairment has been done on account of poor financial performance. I think that was looked at, and I think we were required to take that impairment. In terms of the infusion, it is to strengthen the net worth of the company and also bring about some debt reduction. This is the reason for the infusion.
Understood. Okay. Sure. Thank you.
Thank you. I would like to remind participants that they may press star and one to ask a question. Next question is from the line of Manoj Shah from Laxgove Investments. Please go ahead.
Yeah. Sir, my question is, to make the sugar business viable, how much the minimum selling price should be increased? You are touching in the market somewhere around INR 37-INR 38. And based on your cost of production, how much it should be increased so that the sugar business becomes viable?
Yeah. Venkat, you want to go first? Yeah.
Go ahead.
No, no. Manoj, I think if you ask that question to industry, I think we'd have a really big ask around that one. If you look at most commodities pricing, even if you look at the domestic bill, oil and ghee and whatever else, pricing has significantly moved up in the last 5-10 years. Sugar, unfortunately, has remained very range-bound. The sort of window shortens between the FRP increase and the price. I think this has constantly been represented to the policymakers. I would say something into the early 40s would only be near meaningful. However, it still continues to be a deliberation with them on the MSP. We will have to wait and watch if anything is considered at all.
Do you expect anything to come before this next sugar season starts?
No. I think it's not come around for quite some time. It continues to remain a deliberation. I think if you asked me to talk about release quotas, there's also export allocations, ethanol diversions. These are how the sugar balance and pricing is really managed in our country. It's also essential commodity. Maybe it's perhaps in their own right, policymakers also have intent to keep pricing affordable and range-bound. It will continue to remain a deliberation. I think there are areas wherein which we are hopeful policymakers will make some positive upward revisions. Also with programs like EBP, so on and so forth, there have been good moves made by them as well to strengthen the health of the industry.
Can you comment that through ISMA, you are in some active dialogue with government on this, or it's nothing happening on this front? Any representation from industry to ISMA?
MSP has always been a point which ISMA has taken up with the authorities, and they've always given us patient hearing. It's never off the table in terms of discussion.
Okay. In light of higher sugar production for next sugar year, how do you see the movement in prices? Because you'll have higher cane production, which may again further depress the sugar prices. How will this impact the profitability?
If you go back to my opening comments, I stated this as the first point to watch out for, precisely what you have rightly picked up also now. Yes, with more sugar coming into the balance and with these kind of release quotas and sugarcane ethanol not being given as much of an impetus, there is certainly a risk of downward sliding of prices. Now, which is why perhaps into Q4, 2026 and Q1 and Q2, 2027, having an export program will certainly be something I hope the policymakers will consider strongly to ensure that pricing remains reasonable for us, for the processors.
Any indication on Ethanol Blending Program moving higher from 20% to 25% or higher than 20%?
Again, as mentioned earlier, this is a conversation. As far as we know, the auto industry is certainly prepared for a 20% blend. Beyond 20%, I'm not sure if we have enough insight whether they are prepared. There's also talk of flex fuel and higher blends, but these are in smaller pockets. Up until 20%, I think the industry is prepared. We're at 18% right now. We still have to catch up 2%.
Okay. Thank you very much.
Thank you. Ladies and gentlemen, to ask a question, you may press star and one at this time. Ladies and gentlemen, that was the last question. As there are no further questions, I would now like to hand the conference over to the management for closing comments.
Thank you all for your patient listening. We look forward to meeting again during our Q1 F2026 results in a few months' time. Thank you.
On behalf of Dam Capital Advisors Limited, that concludes this conference. Thank you for joining us, and you may now disconnect your lines.