Ladies and gentlemen, good day, and welcome to Q1 FY 2023 Earnings Conference Call of Grasim Industries 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 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. Saket Shah, Head of Investor Relations and Head of ESG Reporting. Thank you, and over to you, sir.
Hello, good afternoon, everyone. Let me just introduce you to the management team, you know, over here. We have Mr. H.K. Agarwal, the Managing Director. We have Mr. Jayant Dhobley, CEO of Global Chemicals and Business, Head of VFI and Insulators. We have Mr. Jayant Dua, CEO of Chemical Division. We have Mr. Rakshit Hargave, CEO of Paints. We have Mr. Ashish Adukia, CFO, and we have Mr. Pavan Jain, the incoming CFO of the company. Let me just pass on the call to Mr. Pavan Jain for his remarks.
Thank you, Saket. Good afternoon to all the participants. It is my pleasure to speak to you all as the incoming CFO of the company. I've been part of the management team of Grasim for more than 20 years and have handled corporate finance and M&A management and other related matters of the company. I'll be now closely associated with the investors community. This month marks the completion of 75 years of the company's incorporation, and more importantly, the birth of our beloved nation. As we start on our next phase of growth journey, the company is well-positioned to take a leaf out of its legacy and reflect the same. As you are aware, the company has sown seeds of the two new businesses, namely Paints and B2B eCommerce.
I would like to reiterate the newly added Paints business will be an engine of growth to the existing portfolio of businesses. The B2B eCommerce foray is again a high-growth business with less capital intensity. Both these businesses complement the existing lines of businesses within the Grasim umbrella, catering to large market and adding new set of customers. We started FY 2023 on a very strong note with record EBITDA generation at the consolidated and standalone level during the first quarter. Let me now share some key highlights from our businesses. Our chlor-alkali and textile businesses reported highest ever quarterly EBITDA, driven by better realization and sales volume. The VSF business reported a double-digit growth in sales volume during the quarter on the back of strong domestic demand.
The ongoing expansion in chemicals business is progressing well, with Balabhadrapuram phase two likely to be commissioned by Q4 2023, Q4 FY 2023, and the epoxy capacity of 123 KTPA at Vilayat will be commissioned by Q1 FY 2024. The 50 KTPA ECH capacity, also at Vilayat, will get commissioned by Q1 FY 2025. We had promised in the previous quarter, we are sharing the CapEx spend guidance for FY 2023, which stands at INR 3,117 crore for the existing lines of businesses. The CapEx for Paints and B2B will be in addition to this. In the Paints business, we are currently focused on the timely execution of our capacities. The civil work has commenced at four of the total six sites. I'll briefly touch upon the key operational and financial highlights for the quarter.
The VSF business reported strong sales volume growth of 10% QOQ and 76% YoY to 197 KT on back of India-centric demand. The recently commissioned 600 TPD VSF plant at Vilayat has contributed 51 KT to this quarter's sales volume. The global textiles demand is currently on the weak footing given the lockdown imposed in major cities in China and reduced ordering by the U.S. and European retailers. On the pricing front, the cotton prices peaked in May 2022 and have softened thereafter. Just to remind you, the global cotton prices had gone up 2.5x in the time period of 25 months, ending May 2022. The VSF business reported a revenue of INR 3,728 crore and EBITDA of INR 406 crore for Q1 FY 2023.
The VSF business reported a revenue of INR 583 crore and EBITDA of INR 94 crore for this quarter. Moving to chlor-alkali business, the business reported best quarterly EBITDA, driven by highest ever ECU realization of 53,560 per ton on the back of multiple tailwinds, like strong global caustic soda prices, weak INR, and a stable demand environment. The global caustic soda prices averaged higher at $769 per MT in Q1 2023, Q1 FY 2023, against $719 per MT in Q4 FY 2022, driven by factors like supply chain disruptions and higher energy prices. Chlorine realization remained in the negative territory with weakness in certain core user industries like dyes and pigments.
On the other hand, the demand for our captive chlorine VAPs increased year-over-year by 32% in Q1 FY 2023, from 28% in Q1 FY 2022 on the back of higher sales of chloromethane and water treatment and other sanitation products. In addition to the captive chlorine integration percentage, we also wish to share the total chlorine integration percentage, including the pipeline sales to our dedicated customers, which stands at 60%. The advanced material business reported a sequential improvement in financial performance on the back of better realization and some easing of cost pressures. As highlighted earlier, the company reported strong Q1 FY 2023 financial performance driven by multiple factors despite cost pressures.
The consolidated revenue for the quarter are up 41% YoY to INR 28,042 crore and EBITDA is up by 10% YoY to INR 5,233 crore. While at the stand-alone level, revenue is up by ninety-three percent YoY, INR 7,253 crore, and EBITDA is up by 69% YoY at INR 1,364 crore. On the ESG front, the company is working in a focused manner and making continuous progress. The company has adopted Task Force for Climate-Related Financial Disclosure, that is TCFD framework in FY 2022 to reflect its commitment to improve the quality of ESG disclosures. Taking cognizance of our ESG related work, which is in line with the global standards, the company has been included in the FTSE4Good Index.
I would like to reiterate that given our strong balance sheet and strong portfolio mix of cash flow businesses, we are well-positioned to harness the potential of our new businesses. I would like to wish you a very happy Independence Day in advance. Now I hand over back to the operator for Q&A.
Thank you very much. Ladies and gentlemen, we will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on their touchtone telephones. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. We have our first question from the line of Nirav Jimudia from Anvil Research. Please go ahead.
Good afternoon, team, and congratulations on very good set of numbers. I have 2-3 related questions on VSF and then one on chemicals. I'll start with VSF. Sir, in your presentation you have mentioned that China VSF prices have improved almost 14% sequentially, though they are on spot basis. Just wanted to understand because our blended realization this quarter for the VSF division has also improved by almost INR 10 a kilo. If you can share how much of this price increase in China or in the international market is already being captured this quarter. Further to that, whether you have taken any price hikes in Q2 as well. This is one.
Second on the VSF side is, sir, whenever we will operate our capacities at the optimum levels at around 824,000 tons, how much pulp is already integrated and how much we are more planning to integrate? If you can share your thought process on the same. The third question on the VSF side is our specialty volumes is down sequentially. Last quarter we did something around 44,750. This quarter our specialty volumes is almost around 37,500. Any particular reason for the same? Has the premiums narrowed down, and we decided to switch towards more of the grade VSF production? These are the three questions on the VSF side.
The first question on price increase in China in the Q1 and also corresponding increase in our India realization also. Yes, these are related to some extent because VSF is international product and all the markets are connected in many ways. China being the largest producer and consumer of VSF has big influence on the international prices. We have to be in line with what is happening in the biggest market. Now since end of last quarter or even in June itself, the prices started correcting in China also. If you are monitoring, then you will notice that VSF prices are softened in China also.
In here we have to adjust little bit, but not to the same extent, because we also don't increase to the same extent as price increase happens in China. That was on the prices. Also the cotton prices have influence on the all other fibers prices. Cotton prices in forward have come down significantly. They will also have some influence on the VSF demand and prices to some extent. Not a large, but because VSF price did not increase in the same rate proportion as cotton prices. Okay. Moving to specialty volume. Yes, there was some reduction in the month, in the first quarter compared to previous quarter. Some extent some products are seasonal, so that one is one aspect.
Again, to some extent, we had more demand for standard VSF in India, so we adjusted our product mix to cater to the India demand. In international market, there were some more competitive situation or some demand or inventory adjustment at our customer's place. In the export market of the specialty, there was some reduction in the volume. This was on the specialty thing. Going forward, there will be some adjustment period because now recessionary fears are prevailing in Europe. With the cotton uncertainty and volatility, the international retail and brands are sitting on huge inventory because of supply chain disturbance. They are now trying to optimize their inventory levels and optimizing the orders also to the new orders to the value.
This adjustment period will last this quarter and perhaps some. We have to sit through this adjustment period, and then the normalcy should return to the value chain in textile industry. This is on the specialty. What was your third question? Pulp integration. We are now almost 35% integrated with our captive. Okay. We have lined up long-term supply arrangement with our regular suppliers. We have also developed some new sources. There were some disturbance in the pulp supply because of the force majeure reasons. At one of our suppliers' plants, there was a fire, and at another place there was serious flooding, severe flooding and storm. There was some disturbance in the sites, but now things are getting back to normal.
We are working in the long term how to increase this pulp integration. But, this is a, long-term issue and, immediately we are fine with the current arrangement.
Okay. Sir, based on what you just mentioned, is it safe to assume that probably out of the CNY 1800 price increase which have happened in, China and probably some corrections over there, some portion or maximum portion of that is already been captured in Q1 and probably we won't take on any price hike after our Q1, numbers?
Yeah. It's like it doesn't happen exactly CNY 1800 in RMB in China, so we have also exact corresponding thing. It doesn't work out like this.
Okay.
More or less, like, we cannot expect price increase in the current environment because in China the correction is quite severe.
Got it. Sir, one more question on the VSF side is in the presentation in the opening slide, we have mentioned that we are debottlenecking our VSF capacities, and we are intent to spend something around INR 587 crore. From 824,000 tons, which is our current capacity, how much addition we are intending to plan, and how much time it will take to complete this debottlenecking?
This entire amount is not for the debottlenecking. Most of it is part of the regular CapEx commitments for our Vilayat expansion, which has already happened and stabilized, and in July we achieved 100% of the nameplate capacity for the expansion.
There are some commitments which are not directly related with the fiber production, but ancillaries like environment related items or gas recovery system, etc. They are pending. I think almost INR 350 crore or INR 400 crore is on those accounts. The debottlenecking is a small, very light, capital light, thing. We expect to get something around 80 TPD for investment of about INR 200 crore or so. This is not big on the debottlenecking. Production also is not expected to increase a lot from that. This is our normal thing. We keep doing these things wherever we can find opportunity to improve production from existing assets, we try to maximize that. This is not going to be a big game changer by Vilayat expansion.
Got it. If one last question, if I can ask on chemical side, and then again, I'll join back on the queue. Sir, our annual report mentioned that we are planning to add something around 390 megawatts of renewable capacities for our chemical business. Similarly, if you can say or explain to us that whenever we will hit the peak production for our chemical business, predominantly caustic side, how our mix of power would look like, let's say in terms of our own captive thermal, in terms of our own captive renewables, and how much then we have to be reliant on the outside power for to suffice our power requirements?
Okay. I think what the report mentions is a long-term plan where, as you know, in renewable, we really have to look at from an aspect of majority of regulatory aspects which are still unfolding.
Okay.
From a desired output, yes, we are looking at reaching renewable to somewhere around 30% of our total requirement. The mix will continuously keep on changing as the regulatory environment unfolds in front of us. I think it'll be very difficult for us today to really quantify what will be the final mix. I think maybe over the next two or three quarters, as the regulatory environment becomes more clearer in terms of how renewable play will happen, then we will be able to get a much clearer picture on that. From a desire aspect, we said about 30% is what we are looking at.
30% by 2025?
Again, I'm not getting into a timeframe. The reason is very clearly it'll be all a function of how regulations come across.
Okay.
Post-regulation, you have to look at it from how you want to conceive the whole picture. It might be 2025, it could be 2030, it could be 2027. I think we'll keep the timeframe very nebulous as of now.
Okay.
As a target we've taken that we would like to achieve 30% by 2025. Yeah.
Got it, sir. Thank you, sir. Thank you for answering the questions in detail, and I join back in the queue.
Thank you. We have our next question from the line of Navin Sahadeo from Edelweiss Securities. Please go ahead.
Yeah. Good evening, sir, and once again heartiest congratulations on such a record high profitability. My questions were about the margins as we see at least in the near-term perspective. As you said, prices have been trending down. If I just look at some of the VSF prices in China from CNY 15,500, they've gone down to almost CNY 14,500 or so, especially of late as in from let's say mid-July to now as we speak. We don't see that kind of a similar decline in the pulp spot prices.
Wanted to understand that, is it fair to say, at least from a near-term perspective, that the peak margins are probably behind and at least for the next 1-2 quarters, VSF may see some sort of softness in the margins?
You are very up-to-date on the international prices of VSF. You got on at $14,500 and $15,500.
Sir, I'm sorry to interrupt, but the volume is little low.
You are very up-to-date on the international VSF prices. This is the reality, and we cannot go against the tide. This time pulp prices are important. Pulp prices are not reducing in that extent. We believe that if the VSF market shows so much of softness, then pulp prices also will have to adjust. It's a matter of time. There have been some different reasons for pulp market, like supply related issues were more. There were some force majeure situations at major merchant pulp suppliers. As they get resolved and the VSF market softness, then pulp prices should also respond to some extent.
Yes, when other things are other than pulp also there have been other inputs which have gone up very high, like caustics, sulfur, coal, and those are in the adjustment mode to some extent, like sulfur prices have come down, coal prices are also trending down. Margins will remain under pressure. It will not be same like we enjoyed in some favorable quarters. Yes, this adjustment has to play out.
Fair enough, I appreciate. For chemicals then, because your press release also says like, you know, June exit is at $650 versus the average of $760 odd, which we recorded for the quarter. Similar trend in chemicals also of a sequential margin decline is expected or there the cost relief is probably much more and hence the decline in margins may not be that severe? How should we look at those, sir?
This is Jayant Dua. I think, particularly in the chlor-alkali business, the electrolyzer, we are largely dependent on power as our largest source of cost. While we have seen on the fuel side energy prices getting soft, particularly on the group side, but we haven't seen that material change yet on the whole. The expectation is, as you're talking about how the world is moving along, we could see that. That will have a material gain on our cost side front on us. On the international front, I think there is a little bit of, the entire prices which shot up. Had a couple of global events of the Ukraine, the entire supply chain becoming very, very disrupted and tight. Also the COVID impact in China.
How COVID impact in China is reduced. China started producing a lot more material and started filling its international market. Yes, you're right at this point of time. Currently, we are seeing a declining trend in the international market. The volatility is so much that at this point of time, I think it'll be very difficult to predict on the caustic side what could be the margin decline for this quarter. The trend looks that it'll be tapering downwards, but to quantify becomes a very difficult challenge at this point of time.
Yes, appreciate it, sir. Thank you. Just my last question on the CapEx bit. Two parts to it. Of course, you've given a very nice break up to the overall CapEx total, that we're planning to spend this year is over INR 3,100-odd crore. How much should we pencil in, including Paints as well as the B2B e-commerce for 2023 and 2024?
We are not, it's very difficult for a paint project, an ongoing project, to give year by year guidance because it depends on difference at what stage it is, right? There is land acquisition, then followed by environmental clearance, then you order for equipment. A lot of equipment is actually imported, so there's lead time to that. The spend on that is generally dependent on. These are big spends, right? We've given you a guidance of INR 10,000 crore of project cost for Paints and likewise for B2B as well as a total cost. It'll be spread over that period, right?
Till now we have spent about, as we've mentioned, INR 825 crore till June end, and quarter one was INR 212 crore. If you see quarter-on-quarter figure, it's not obviously evenly spread. It's difficult to say what that breakup would be. Of course it will be, from now on, it will be front loaded because we've started ordering for equipment, et cetera. The construction has started in full swing in almost four sites.
Okay, safe to assume that a chunk of it, like, you know, regardless of the guidance, but a significant chunk may come in per se, let's say second half of 2023 and 2024.
Absolutely right. I think that is good to assume because of given our target that we've given for, you know, commissioning of the capacities.
Fair. That's helpful. Thank you. Thank you so much, sir.
Thank you. Ladies and gentlemen, to ask a question, please press star and one on your phone now. We have our next question from the line of Prateek Kumar from Jefferies. Please go ahead.
Yeah. Good evening, sir. My first question is on VSF segment. We have operated utilized capacity at close to 95% this quarter. Is it something like we like let's say, I mean, and you mentioned that in June you operated at 100%. Next leg of, I mean, major expansion in terms of brownfield. I'm not talking about debottlenecking, but a major brownfield expansion may be lined up again in parallel with the same CapEx, which you're already executing.
You're talking about caustic expansion or VSF?
VSF expansion.
Yeah. We would love to do that, Prateek, but for the time being, that is not immediately on the drawing board. We have to see, and the same, we have to optimize and balance the CapEx, the equity, the EBITDA and other new businesses. This is a capital allocation challenge or strategy. Yeah, but sure, we are aware of this situation and we are continuing to develop our market and we, at appropriate time, definitely we will draw the plans.
In general, like, I mean, we operated like 95% and like for the full year we should assume now we should have like a 95% utilization for VSF capacity over 24,000 for the segment.
Yeah, we would love to do that, but there may be some in between headwinds, like we had this pulp supply situation which affected production at some of our plants for a few days or week or something like that. Barring such unforeseen situations or some severe market thing, because we are living in such volatile conditions. If things remain normal, then yes, we have been always operating in high nineties or ninety-like above nineties. That is our attempt and our target for sure.
Sure, sir. On CapEx, one more follow-up. Like we have given for Paints, INR 10,000 crore, E2E INR 2,000 crore. For other ongoing businesses, I mean, while you mentioned that this is a capital allocation question, but over FY 2023 to 2025, what kind of CapEx which we may want to do over FY 2023 to 2025? Maybe what is the kind of net debt to OIBDA we may want to have as like the-
For a particular business, your question is.
Other than Paints, you are talking of other than Paints in B2B.
No, I mean, frankly, while FY 2023 CapEx number was not announced till now in terms of, because it was not approved, as was discussed in last call, but it appears a bit high, to us at least. Like stand-alone CapEx, if you see over next three years, besides the CapEx on Paints and B2B, what kind of CapEx which you might be doing over, I mean, like we expect chemical and other businesses.
Sure. I think, you know, let me first explain, you know, the CapEx that we've given out for this year. Okay. I think in terms of guidance, we'll continue to give the annual CapEx rather than trying to give, you know, next 2-3-year guidance. You know, you asked about this year's guidance now. Mr. H.K. Agarwal had highlighted the three categories of CapEx that we have in VSF, which is the debottlenecking, a small portion. The expansion at Rehla, and then the balance is modernization and maintenance CapEx. Now, modernization and maintenance CapEx also includes some of the projects that we are going to take up, which are not going to be annual, every day recurring CapEx. It will be one time.
For example, in the past, we've talked about carbon absorption plant, et cetera, to be put up in all our four sites of VSF. Those are large CapEx, but that will not recur after once it has been put. Therefore, that figure is slightly on the higher side. In chemicals, you have eight sites, and all those, you know, sites you keep putting up either, you know, chlor-alkali, which we have announced, then there are VAP projects, chloromethane, et cetera, that we have already announced at each. The third is power. Both renewable as well as in some places where it is critical, you need to put up something to enhance the capacity. We are doing that. Those are the three categories in the main strategic CapEx, and then there is maintenance CapEx.
These are the things that are forming part of the INR 3,000-odd crore that you've seen.
Our annual maintenance CapEx is how much?
See, I think it will be. You know, it varies. Like I said, that environment related CapEx can be. It may not be a recurring once you put up a particular type of equipment. But somewhere around, you know, INR 1,500 thousand to INR 1,500, that range you can assume for Grasim.
I mean, just for, it's a question on this. We are anticipating a very large CapEx in FY 2024 for paints because we are assuming that in FY 2025 we should launch a product. We have like 1,000-1,500 basic CapEx, which we should have anyway. Next year also, it pretty much we should have like a INR 6,000 crore kind of CapEx for Grasim and known operations.
Early for us to comment. When the board approves the numbers, we'll definitely share with you. You know, directionally, yes, there will be large paints CapEx next year, along with other CapEx.
Sure, sir. These are my questions. All the best.
Thank you. Ladies and gentlemen, to ask a question, please press star and one on your phone now. We have a question from the line of Bharat Sheth from Quest Investment Advisors Private Limited. Please go ahead.
Hi, sir. Thanks for the opportunity. The first question is on taking on this VSF margin, which in this quarter, value-added product was relatively lower, and you said that one of the factor was also softer seasonality. Going ahead, if we improve this value-added product, how much can it, I mean, give support to our profitability?
See, VAP accounts for roughly 20% of our total sales in this quarter. Still our attempt is to always increase the VAP volume and percentage share in our total product mix. VAP normally on an average earn a premium in terms of pricing about 12%-15% over normal standard fiber. But still it will take time. It is not that we can increase the VAP volume or VAP share overnight. It is a very slow process because approvals by the brands and then value chain and all these things. There is a competition. It is not that VAPs are without any competition. It's a long process and we have been working on developing our VAPs. This is a directionally we will continue to increase VAPs.
The effect will be slow, but it will be slow and steady.
Okay. To some extent, I mean, in quarter-over-quarter, in this quarter particularly our volume was low vis-à-vis Q4. Again as to last year normal, this year there will be some addition will be there?
This year we are seeing a lot of volatility in international markets. VAPs are also like, from Grasim point of view, almost, 50% domestic, 50% export oriented and international markets are seeing more, headwinds in overall textile, business.
Difficult to share the specific thing that how much will be the increase or what will be the volume this year.
Okay. Sir, and coming on the chlorine, I mean, chemical side, in chlor-alkali we say that prices are declining. I understand this year, I mean, in this quarter our captive consumption has increased, so chlorine which used to contribute little negative margin. How do we see this quarterly, you know, I mean, from traction for the current year?
Our caustic integration is largely our internal consumption is on caustic side. Chlorine is all which is either used in our own derivatives or producing hydrochloric acid or sent to our ancillary or sent out to the market. Chlorine at this point of time is trending on negative, has been for the last two or three quarters now.
Interestingly, our chlorine integration, if I look at as a sum total of all three, is 60-odd% today, and 40% is what we call as a merchant sale of chlorine. On chlorine prices, you know, you've got segments like pigments and dyestuff which are impacted because of the European situation where a large export happens. Also, you know, there are some positives which happen in some industries. The pulp and paper has gone up because of the school opening. The pigment and dyestuff went down. Water seasonality is there. In monsoon you will see large more of, you know, sanitization product sales go up. Post-monsoon they start coming down. That's a continuous business operation cycle.
Currently, I think the way we look at it is 60% chlorine integration internal, 40% is merchant sale. Currently, chlorine is running negative. The trend is at the moment that it continues to run negative because of the entire chlorine demand, which probably needs to pick up more than what it is today.
Okay. Thank you and all the best, sir.
Thank you. Reminder to participants to press star and one to ask a question. We have our next question from the line of Vihang Subramanian from Java Capital. Please go ahead.
Yeah. Hi. Thanks a lot for taking my question. Apologies if it's been asked before. I just got disconnected in the middle. On the paint side of the business, just wanted to understand on a broad strategy perspective, what would be the strategy there? Like, because I mean, given that we have already two large, you know, incumbents, like, would our strategy be based on pricing?
Sorry, Rakshit, you're on the call. Would you like to take the question?
Yes, I'm on the call, and I would like to answer that. Obviously, when we have thought to enter this market, we have a specific plan. You would appreciate that at the moment we would not want to share anything about it. It is confidential, but the team is obviously confidently working on it.
Got it.
I hope that is. I think in terms. Enough.
Yeah. Yeah. I mean, any details you could give which would be like, you know, helping will be like appreciated.
No. You know, I would really want to avoid any forward-looking statement on our strategy in terms of what we are going to do, to keep it very proper. Obviously we have a plan, and it will work out.
Sure. Just from a timeline perspective, like, if I understand correctly, FY 2025 is when we would be looking at some kind of revenues come through. Is it?
Yeah. Like we disclosed last time, the last quarter of next FY.
All right. Full FY 2024 then. Okay.
Yeah.
Got it. Sure. That's it from my side. Thank you.
Thank you. Ladies and gentlemen, to ask a question, please press star and one on your phone now. Reminder to participants to press star and one to ask a question. I would now like to hand the conference over to Mr. Ashish Adukia for closing comments. Over to you, sir.
Yeah, sure. Before the closing comment, I just wanna clarify one comment I mentioned on renewable. Renewable, our target, is 25% by FY 2030 and not 30% by FY 2025. Apologies for that confusion. This is my last call, and as I hand over to Pawan, I wish him all the luck. I've had great 3 years. We did some good strategic improvements. We incubated paints. We sold fertilizer. We are in the process of incubating B2B e-commerce. We've stepped up the dividend. Hopefully we've made you happy. We're always here to listen to you and see how we can improve and address your concerns. Thanks a lot.
On behalf of Grasim Industries Limited, that concludes this conference. Thank you for joining us, and you may now disconnect your lines.
Thank you, Yashaswi. I'm disconnecting now.
My pleasure, sir.
Thank you.
Thank you.
Bye-bye.
The conference is no longer being recorded.