Q1 24/25

Jul 29, 2024

Summary

Q1 FY25 revenue rose 15% YoY to INR 1,718 crore and PAT rose 26% to INR 209 crore. Expansion is focused on DI pipes and ferro alloys, funded internally, while management targets lower debt and expects robust DI demand.

Ladies and gentlemen, good day and welcome to the Jai Balaji Industries Limited Q1 FY 2025 earnings conference call hosted by Go India Advisors. As a reminder, all participants' 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 will hand the conference over to Ms. Sana Kapoor from Go India Advisors. Thank you, and over to you, ma'am. Thank you, Neha. Good afternoon, everybody, and welcome to Jai Balaji Industries Limited Q1 FY 2025 earnings call. We have on the call Mr. Aditya Jajodia, Chairman and Managing Director, Mr. Raj Kumar Sharma, Joint CFO, Mr. Vijay Wadhwa, President Finance, and Mr. Ajay Kandhar, Company Secretary. We must remind you that the discussion on today's call may include certain forward-looking statements and must be therefore viewed in conjunction with the risks that the company faces. May I now request Mr. Aditya Jajodia to take us through the company's business outlook and financial highlights. Subsequent to which we will open the floor for Q&A. Thank you, and over to you, sir. First of all, a very good afternoon to all ladies and gentlemen. We are extremely pleased to welcome you all to our Q1 FY 2025 earnings call. Our investor presentation briefly has the financial results have been uploaded on Data Changes, and we hope that you have had the opportunity to review it. I am pleased to announce that Jai Balaji has started FY 2025 on a very strong note with its highest ever adjusted EBITDA and adjusted EBITDA margin of INR 325 crores and at 19% respectively. Our efforts are closely aligned with the goals set in Jai Balaji 2.0. We aim to focus on value-added and specialized products such as DI pipes and specialized ferro alloys while also strengthening our balance sheet. Jai Balaji is expanding the capacities of DI pipes and ferro alloys to increase the contribution of these products from the present 45%-50% to 80%. I am also delighted to report that we have achieved our target of achieving capacity utilization above 90% and expanding the EBITDA margins to the range of 18%-20%. JBI will now work to maintain this performance going forward. The company also aims to be net debt free within the next 12 months and plans to undertake the CapEx of INR 1,000 crores from internal accruals entirely. Out of this INR 1,000 crores of CapEx, around INR 705 crores has already been incurred by internal accruals till Q1 FY 2025. Before discussing the financial and operational performance, I would like to highlight the following. The updates on the capacity expansion plans. We are planning to increase our DI pipes capacity from 3 lakh tonnes to 6.6 lakh tonnes. In this, 1.4 lakh tonnes is expected to be commissioned in FY 2025, and the capacity of 2.2 lakh tonnes is expected to be commissioned in FY 2026, bringing the total DI end capacity to 6.6 lakh tonnes in the near future. Ferro alloys capacity will be increased from 1.6 lakh tonnes to 1.9 lakh tonnes and is expected to be commissioned by FY 2025. One of the blast furnaces has already been revamped and commissioned in FY 2024 and the completion of the second blast furnace is anticipated in Q1 of FY 2026. Post this revamping, the capacity will increase from 6.3 lakh tonnes currently to 7.5 lakh tonnes. Additionally, the capacity of sinter has been raised to 9 lakh tonnes in FY 2024 and the balance 3 lakh tonnes per annum is expected to be commissioned in FY 2025. With this, the total sinter capacity will increase to approximately 12 lakh tonnes per annum. The company is also in the process of taking up a blast furnace waste heat recovery project of 35 TPH. This green energy project aims to reduce carbon footprint by integrating it into the captive power plant to optimize the utilization of waste gases from the blast furnace. The project is expected to commission within the next 2 months. For more information, you can kindly refer to slide number 13 of the investor presentation. Update on the CapEx plan. We earlier announced a CapEx plan of around INR 1,000 crores for the capacity expansion as discussed just now. Out of this, INR 705 crores has already been incurred, and the balance INR 395 crores is expected to be incurred over the next 12 months. As we have mentioned, all this CapEx has been done through internal accruals and our guidance for FY 2025 CapEx is INR 300-INR 350 crores. In Q1 FY 2025, we have spent around INR 108 crores. The company is also making substantial strides in its net debt reduction strategy. In Q1 FY 2025, the net debt of our company decreased to INR 384 crores from INR 71 crores in FY 2023. This debt is negotiated with ICICI Property Limited and with the bond lenders, and we are optimistic that within the next 12 months, we will achieve our goal of becoming a net debt-free company. Our FY 2025 guidance is to reduce the debt to INR 125-INR 250 crores by the end of FY 2025. The company is also very much dedicated to reducing this loss by boosting operational efficiencies, including the ownership of 3 railway siding and having captive power facilities. Coming to the operational performance. Production of all the products showed increasing trend year-on-year basis. The production for TMT, ferro alloys, and DI pipes increased by 18%, 39%, and 4% to 60,000 tons, 34,000 tons, and 64,000 tons respectively. Similarly, sales for TMT bars, ferro alloys, and pipes increased to 58,000 tons, 19,000 tons, and 61,000 tons, up 18%, 19%, and 4% respectively on year-on-year basis. Realization of ductile iron pipes showed an increasing trend of 10% year-on-year to INR 47,000 per ton, whereas the realization of ferro alloys dropped by 5% to INR 171,000 per ton, respectively. Coming to the financial performance. Revenue for the quarter increased by 15% year-on-year to INR 1,718 crores. Once again, I am pleased to share that Jai Balaji has achieved highest ever EBITDA result to INR 625 crores, which is 58% more year-on-year, and EBITDA margins of 13% Q1 FY 2025 compared to 14% in Q1 FY 2024. The PAT also showed a significant increase of 26% to INR 209 crores compared to INR 170 crores earned in Q1 FY 2024. Similarly, the PAT margins showed a jump to 12%. Overall, the performance FY 2025 has been outstanding on both operational and financial front. In conclusion, I would want to say that the company is well-positioned for growth, supported by strong industry tailwinds in the ductile iron pipe industry and the specialized ferro alloys, and also robust capacity expansion plans, low cost CapEx, a very healthy balance sheet, fully integrated operations with robust cost reduction strategies, experienced management, and backing from all the stakeholders. We are very positive about maintaining this momentum as we enter into FY 2025 and continue to provide exceptional results in the future also. We can now open the floor for 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 their touchtone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handsets while asking the question. Ladies and gentlemen, we will wait for a moment while the questions are sent by. The first question is from the line of Vikas from PhillipCapital. Please go ahead. Good afternoon, sir. Thank you for the opportunity. Sir, just wanted to understand if you can give the EBITDA per ton separately for the DI pipe as well as ferro alloy for the quarter. Yes. For DI pipe, the EBITDA per ton was INR 21,000. For ferro alloys, it was INR 37,000. And I have the numbers for pig, TMT sponge also. Pig iron was INR 7,000. TMT bars was INR 6,000, and sponge iron INR 5,000. Thank you, sir. Sir, given the iron ore prices are going down, as well as the coking coal prices are supposed to be lowering too, can we expect the DI and steel EBITDA per ton both can go further up, or it would be different? The price of ductile iron pipe will be adjusted because of the raw material prices going up, definitely. Generally, there will be some profit. As far as DI, for ductile iron pipes, the cost of iron ore going into ductile pipes is not much. So it will not significantly impact the profitability of ductile iron pipes. What you are asking on coking coal, since the prices of coking coal have just started to come down, we normally have an inventory pipeline or order pipeline of coking coal around 4 to 5 months. So for any, I will say, negativity or positivity to be factored into the P&L, it will take around 4 to 5 months lead lag will be there. Understood, sir. Sir, as you said that the ferro alloy blended EBITDA per ton around 37,000. What is the breakup between the normal and specialized grade ferro alloy in that? How should we look at the difference between the two in terms of EBITDA per ton? Whatever the other people are producing, we will get. Because we are not sharing the specialized grades separately, and we are only handing out or giving out the Understood. Sir, lastly, on that sinter capacity raising, in terms of our cost of production, how does it impact us? If you could give us some idea of that. Sir, can you repeat the question? I do not seem to have got it the first time. Sir, in terms of sinter capacity which we are enhancing, how does it change our current cost of production savings per ton basis? What are we expecting once it is fully ramped up? Sinter is a replacement of iron ore in the blast furnace at approximately INR 1 to INR 5 per kg. Sinter is cheaper than iron ore. It is a replacement of pellet and lumps iron ore in the term. Okay, sir. Sir, any volume guidance which you would like to give us? Volume guidance for DI pipes, we should finish this year in the region of 4 lakhs-4.5 lakhs. Ferro alloys, we will have the capacity of 190,000, but roughly the numbers will be in the region of 40,000 in the first quarter. But the blend of the value-added product and your specialized-based product will go up. Understood, sir. That's all from my side. I'll come back in the queue if I have further follow-up questions. Thank you. Ladies and gentlemen, you may press star and one to ask a question. The next question is from the line of Manu Gojia from UA Securities Limited. Please go ahead. Yes, thank you for the opportunity, Sir, and congratulations on the numbers. My first question comes on the CapEx plan. Like you mentioned, out of the INR 1,000 crores, roughly only INR 395 crores is left pending. I wanted to know, has the management now decided on any new plans once this CapEx is over? See, as of now, our guidance remains restricted to the INR 1,000 crores. The first focus of the company will be to complete this particular CapEx plan. As of now, our guidance and our plans remain restricted to this. Okay. I think the guidance for FY 2025 is going to total CapEx also stands at INR 350 crores. Could you just quantify the number of CapEx that was done during Q1? Q1 was INR 112 crores. INR 112 crores. My second question is pertaining to the realization trends, especially for DI pipes and ferro alloys. If you look from a QOQ basis, there has been a fall in the realization for both of these products. Can you just give a guidance on where do you see these numbers going from the Q1 figures, and how is Q2 also shaping up on this particular trajectory? The prices are minor changes. We generally see the price on a year-on-year basis that is more or less stable, and we expect that prices will be stable for DI and the ferro on a year-on-year basis. Usually Q4, some prices vary because of global demand and other reasons and things. On an annual basis, it will be similar. Okay. Sure. Sir, if I could, just one more question. I wanted to talk about the other income part when it comes on your numbers. If I look at the standalone numbers for Q4 and Q1 of this particular year, there is a significant drop in the other income. Can you just let me know what this change was? Was it like a one-time item that had happened in Q4? Definitely, you have answered the question. Those were the one-off items, extra provision, which we had taken in the earlier years, and those were written off. Sorry, the provisions came into the other income, and I think that is it. In the first quarter, there is an other income of only seven to eight crores, as far as I can see. That was a one-off item which was taken in the fourth quarter. Okay. Sir, thank you so much, sir. I will join the queue if I have more. Thank you so much, and all the best. Thank you. Ladies and gentlemen, you may press star and one to ask a question. The next question is from the line of Shweta Dikshit from Systematix Group. Please go ahead. Hi. Good afternoon, sir. Thank you for the opportunity, and congratulations on a good set of numbers. My question is around the realizations only. As you've mentioned that because of strong fourth Q, the prices realizations were higher. But could you also throw some light what were the margins for DI pipes and ferro alloys in the fourth quarter? Like you mentioned, INR 21,000 for one Q. What were the margins in fourth quarter? That was I don't have the numbers in front of me, but somewhere in the region of 1 crore to 2 crores better than what it was. So sir, if you see realizations falling from here, based on the movement in raw material prices, especially coking coal, what kind of margins are we looking at for the next few quarters? Well, for ferro alloys, definitely with the increasing of the specialized base, the blended margin will increase. As far as ductile, this is for me, good enough customer that we have got. Plus minus INR 500, that is the realization. The order performance is the same price that we have taken. We have an order book of six months. Could you repeat once again? There was a disturbance in between. What exactly you were saying? Realization of DI pipes will be in the range what we have got in the first quarter, because the order book position of six to seven months that we have is in the same price level. As far as cost is concerned, we have inventories also. So cost will also be in the similar lines. So we think that for the next two quarters, INR 21,000-INR 22,000, plus INR 500 will be the realization. Once the new plant which is being set up, once that comes in, the volume benefits were taken also. That will increase the margin. Sir, ferro alloys, what kind of margin difference is there for domestic versus export? How much proportion do you have in exports versus domestic sales? Is there a margin difference? Margin difference, so blended was actually the rate we are giving now. That doesn't have a specialized base. There will be different specialized bases and different geographies where we are exporting to countries. So realization and the EBITDA per ton are similar. If this quarter we made INR 37,000 EBITDA margins for ferro alloys, what, in your view could be the exact EBITDA per ton when we ramp up to 190,000 tons of volume number by the end of this year? Madam, the guidance which we are giving currently, which is for blending for all the products. Our guidance is for roughly 20% of the gross turnover of the company. We are looking for 5% of EBITDA margins for this quarter only. We are very close to our guidance. We are sticking to our guidance, madam. Okay. Thank you, Sir. Thank you. Ladies and gentlemen, you may press star and 1 to ask a question. The next question is from the line of Pradeep Rawat from Yogya Capital. Please go ahead. Yeah, thank you for the opportunity. My first question is regarding the Jal Jeevan Mission. So how is the demand for DI pipes from this particular mission? Is there any kind of instances where PVC pipes are being increasingly used against DI pipes in this particular scheme? Yeah, for the first one of your question, about the Jal Jeevan Mission, still it is not over and there is still the demand is more than the supply. So this will keep on helping us to have a better robust demand in India. The second part of the question, can you repeat please? Are you seeing any kind of instances where PVC pipes are being increasingly used against DI pipes? No, not at all. Plastic and PVC pipes have been done for many centuries. But till now, DI has its own longevity and life cycle, which nowhere any plastic pipe can take replacement of a DI pipe in the current scenario. Yeah, understood. How much of the revenue from DI pipes is from Jal Jeevan Mission for us? It is a blended order which comes majorly from Jal Jeevan Mission on road to different state departments. We are supplying on a pan-India basis. Just from one mission is not possible to write off. We don't materialize that. But it's on a pan-India basis. Okay, understood. Did we witness any kind of demand slowness with respect to the election? There is a fund issue and some monsoon issue is there, but in terms of demand is always there. It is just some weaknesses that is an annual phenomenon. Nothing to do with this particular year of particular election. Yeah. Okay. Understood. With respect to raw materials for DI pipes, you said that we work on order basis. Is the raw material prices for DI pipes held on the date of order winning or did it hedge it later? See, normally what we do, the raw material is not procured for DI pipes only. Raw material is procured for producing the DI pipes or pipes. We are an integrated producer. We do not look at the procurement as a process of doing pipe production. We are seeing it as a business line, whether you are producing steel or pipes. That is the business. Like I just mentioned earlier also, normally we keep an order pipeline. I would say, usually, that is why we have a pipeline of around 4-5 months of working coal and also similarly for iron ore. It is not based on the order of DI. It is always based on the process plan of the customer. Got it. You got it clear. Okay. Understood. With respect to captive consumption, if possible, can you provide the number, like in percentage term, how much of the particular product is captively consumed? With regards to captive consumption, ferro alloys which we are producing, to make special grade ferro alloys, around 30% of the ferro alloys is consumed in-house. For DI pipes plant, which we are manufacturing from hot metal, whatever hot metal is required to produce DI pipes, the hot metal is used for making DI pipes, and balance we are selling as ready as ingots. In the subsequent months, when DI pipes capacity increases, the entire hot metal will go into producing DI pipes. Okay. Understood. Okay. Thank you. I am done. Back to you. Thank you. Ladies and gentlemen, you may press star and one to ask a question. A reminder to all the participants, you may press star and one to ask a question. The next question is from the line of Kaustubh Shah from Wallfort PMS. Please go ahead. Hi, sir. Thanks for the opportunity and congratulations on the good set of numbers. I had two specific questions. One is that, we have been consistently for last four, five quarters giving a INR 200 crore plus profit after tax. When do we see our credit rating going up? Any thoughts on that? We are already approaching the credit rating agency after this Q1 number, and we expect the ratings to improve based on the numbers. Okay, sir. The second question was that, once our capacity expansion takes place and the capacities have increased both for DI and ferro alloys, the current power plant capacity will be sufficient, or you intend to add anything to the power plant? Or you continue to purchase it from outside? As of now, we are sticking to the CapEx which we have already given in the guidance. Okay. Whatever power will be required for the enhanced capacity also, we will be sourcing the same from the grid. As of now, in future, whatever CapEx we have announced, we are sticking to that only. Okay, sir. Lastly, my question, actually, it has been already asked, but still, on the Jal Jeevan Mission, because we have seen that the other competitors have also amped up their capacity, and they have been also increasing their DI pipes capacity expansion. Will it be a scenario that in one or two years, there will be overcapacity of DI pipes and the revisions will get impacted? Anything that you feel that something similar may happen? The current capacities are adding up, but still there is a huge backlog of demand in the country. Due to this backlog, already a lot of export orders have been diverted to the domestic business. Still there is a lot of opportunity for the suppliers to export DI as well. In the near coming years, apart from the Jal Jeevan Mission, there is river linking project, AMRUT 2.0 and other projects also in line, which should always be there in the next two, three years also and in the future, where the supply and the demand, there will always be a gap. Okay, sir. Fair enough. If I may want to add a couple of things. The capacity addition is going to be done by existing players only. For a new player to come in and add capacity, it means setting up a full integrated steel plant, which is itself a Herculean task. There is a huge CapEx involved also. Typically, the demand which you are right now talking about, the demand is for the new pipe system only. There will be after five years, there will be five, seven years, six years, there is also going to be a replacement demand. Also, there is demand from the local industry. Irrigation has still not been tapped. We are not exporting much simply because the demand in India is very high. The existing demand, it is far more than the supply, number one. In the forthcoming 4 to 5 years, 6 years, 7 years, we are not seeing any change in the scenario. Okay, Sir. Got it. Thank you so much. Thank you. Thank you. The next question is from the line of Dipesh from Manya Finance. Before that, ladies and gentlemen, you may press star and 1 to ask a question. Am I audible? Yes. Yeah. Can you throw some light on your top five clients of DI pipes and ferro alloys, and what percentage of revenue do these clients contribute? Top five clients for the DI is Megha Engineering, NCC, Kalpataru Group. The government direct is also purchasing from Jammu-Kashmir, from Maharashtra, Haryana, and Rajasthan also. Okay. And what percentage of revenue do these clients contribute, the top five? Top five is around. It's not a percentage. They are the top five. Percentage doesn't work out. We don't have the detail. We can come back to you. Okay. You can come back. The top five account for maybe about. Hello? Top five quarters. I just want to understand approximately kitna hota hoga? Ye number milenge aapko abhi saamne main, Saman ke bhi denge. Sure. I will go to the next question. What is the payback period of the DI pipes and ferro alloys capacity expansion project? And the ROI also. See the ROI and ROCE as a company as a whole is very, very high. As you might have seen that the ROCE and ROI is in excess of 40%-45%. This is the return on capital and return on equity. When we are talking about together the project, of this investment, it is very, very good. But actually, you look at construction, this is a forward integration of the existing facilities. It was already in the past for thousands of crores. We are not looking at it in the way of ROI. ROI is very, very fast. It is 100% complete from that perspective, but I think as a management, it would be ajab se jyada kam aayegi. ROI rehenge, woh to 40% plus hai. You expect that this ROI will be maintained over the next not only few quarters, but also few years because this ROI is quite high. That is why. Absolutely. [Foreign language] because actually whatever we are doing, whatever the strategy of Jai Balaji Industries is there, that will be focused on ROCE and ROE. Mm-hmm. Do you have a dividend policy in place? The issue is there are certain past issues which need to be addressed as far as the balances are concerned. However, we are hopeful that within this financial year, we are expecting some dividends from the company. Okay. Can you give me a guidance for the raw materials, cost of raw materials, and the prices going ahead, what is your outlook? Major raw materials are basically iron ore, coal, and coking coal. Currently, in the current scenario, all three of them are weak, and we are expecting the prices for these products will fall down in the coming quarters. Fall down in coming quarters. So you will expect better margins because of that, or will you even have a price reduction because of that? Margin is a separate issue altogether because how competitors will play in India is a variable thing. What we can say is that our margins for DI and ferro, we expect to be maintained. The commodity margin might vary a little bit here and there, but the overall mix in our growth portfolio is very low. I am trying to understand that if there is a reduction of raw material cost, will there also be a reduction, or will we pass it on to the customers, or we are going to absorb it in our own margin? Like we explained earlier as well, the contribution of iron ore to our DI pipe is simply less than 15% altogether. Small changes in the iron ore prices will not affect the margin drastically. There are INR 1,000 here and there can be there on the annual basis, but not much. What is the maximum component of the raw material? Is it coal? The major is coking coal and coal, followed by iron ore. If that increases, the coal prices increases in future or it decreases in future, how much effect will that have on the margin? See, a lot of our contracts are also linked to the indexes of different raw materials and iron as well, and some of them are iron as well. What we've seen in the last multiple quarters, there has been variation in coking coal prices, right from up to 40% prices are varying. But more or less, the margin are stabilized because if there's a very steep rise, some amount is passed to the consumer as well. If there's a very steep fall, little bit is passed on to the consumer. Either way, the margin are more or less stable because the demand is very robust for DI pipes. Do you have any coal linkages? Sorry? Do you have any coal linkages? Yeah, we have. From Coal India. Oh, directly from Coal India. Okay. Thank you. I will call back in a minute. Thank you. Thank you. Ladies and gentlemen, you may press star and one to ask a question. A reminder to all the participants, you may press star and one to ask a question. The next question is from the line of Saket Kapoor from Kapoor & Company. Please go ahead. Namaskar, Sir, and thank you for the opportunity. Sir, as you were answering to the earlier participant regarding the RM basket. If you could just elaborate how are the prices currently trending, and I think so we must be carrying the inventories also. So if you could just give a color for our DI pipe manufacturing, how many months of inventory for coking coal do we carry, and what are the price trends for the first quarter and this month of July? Approximately, the inventory for coking coal, we should carry for four to five months. This includes FIFO inventory, and for iron ore inventory, similar inventory as well. As we are seeing that there is some fall in the prices, and the guidance for the future is also seeming to be on the lower side for iron ore prices. Coking coal is mentioned there. Regarding coking coal? Coking coal prices are also on the lower side currently, but the coking coal market is highly volatile. We do not like to judge the market on the basis of one or two months' prices. What we see on an annualized basis, the prices might be lower by 8%-10%, but not a lot. Sir, can you quantify just for the trend purpose, just to understand the trend in the coking coal prices, if you can give the March average for our benchmark and the June average and the current month prices, just to get a sense of the trend. That data, I think we will send you by mail. There is a lot of query about that. We will send you on mail the data. Okay. Prices have been trending lower. QOQ, averagely lower. I will explain. Prices have spiked in the month of February and March also. Coking coal is one of the most volatile commodities. Yes, sir. What happens is that if there is a cyclone in Australia or there is one mine shut down somewhere in, say, Mozambique or in Australia, the prices jump up by 30%, 40% within a week's time. Then things are normalized. Again, they start to come down. So it is a very volatile market. If anyone is able to predict the coking coal market, then I think only the trading and coking coal people could be billionaires and as a trader. So it is not easy to predict the market. But the trend is that at this point of time, because of the global steel prices being little soft, the trend is that logically it will come down. Logically. But the logic does not play out. But then what happens is that if there is any scarcity, immediately prices again goes up. But, sir, for current order book, we have 4 to 5 months of inventory for both coking coal and iron ore and when that prices are trending lower. This can be a good understanding. Sir, absolutely this can be taken. Also one more thing, in case of coking coal is actually imported into India, we always have to keep an inventory pipeline because the transportation time from Australia to India takes around 4 to 6 weeks. Then you need some stock at the Australian port, some stock at the Indian port, some stock at the plant, so that inventory pressure of you remains always irrespective of the prices. Yes. That is the reason why I am asking the same question back. This is a very similar third question, for DI pipe, are these sustainable margins? Going ahead, if you could give some color on the DI pipeline also, the demand-supply scenario, how are you seeing the realization for DIP going ahead? I think we have answered this question a couple of times, but again, we will answer it. As far as the margins are concerned, whatever guidance we are giving, we are confident of maintaining this particular guidance. As far as the margins are concerned, to the guidance which we have maintained, we are absolutely confident. Okay. Also we had answered earlier, the demand, particularly right now, it is very robust. Even in the forthcoming four, five, six years, demand will be very, very healthy, sustainable demand. Sir, realization complete. Again, I am sorry, repeat. Yes, sir. Sharmaji, realization. Yes, sir. First part, you said, depending upon the pending process from the government agency in terms of the delivery schedule, how are we seeing the DI pipe market currently? Is the demand outstripping the supply? There are also some players who are coming up with capacity, especially in the western part of the country. We have already answered this, but I will repeat it, that demand is too much global. Apart from all the supplies and new supplies which keeps coming up, there is nothing to worry on the demand side. The government tenders, all tenders are in place and government spending is in place. We are having our annual tenders annually with the government as well as we are having back-to-back orders from the EPC companies as well. So we have a healthy order book, and we feel the same, to have the same in near future also. Okay, sir. Lastly, sir, then what should be the tonnage we are expecting for the current fiscal? Four to 4.5 lakh tonnes is the current fiscal. Okay. For FY 2026? 2025, 2026? It will increase approximately to 6 lakh tonnes. That should be the target in FY 2026. See how the food arrived. It is arrived. Last point is on the special high-grade ferro alloys, which Sharmaji has also, and Aditya has already mentioned earlier that we command a premium. If you could give some more color, how are the price trends there since other commodities have also corrected. On the realization front, if you could comment something. The price trends, these premium ferro alloys, electric furnace ferro alloys, they are normally priced in accordance with the base ferro alloys. If the price of the base ferro alloys will be reducing, there will be some reduction in the prices, but then the margin remains the same. Okay. Contribution will be similar only? Yeah, absolutely. Yeah. Right. Thanks a lot. I'll end it. Thank you. Ladies and gentlemen, you may press star and one to ask a question. A reminder to all the participants, you may press star and one to ask a question. The next question is from the line of Aditya, an individual investor. Please go ahead. Hello. Good afternoon, Sir. Am I audible? You are from which firm or within the- I am an individual investor, sir. Okay. Sir, I wanted to ask regarding OPVC pipes. Sir, all the PVC players like Supreme, Canara, Astral are putting up OPVC capacity and they are claiming that this is a product which is cheaper than DI pipe, it is easier to handle. Also, DI pipe manufacturers like Hindalco Corporation is also entering into this market. So sir, can our product is going to get disrupted- Not OPVC. Can you speak a little louder, please? Am I audible, sir? Audible, sir. If you speak a little faster, I will be able to hear. Sir, my question was that the OPVC players in the market like Astral Poly, Supreme, Canara, they are all saying that the DI pipe will be replaced by OPVC. It is cheaper and easier to use. There is only a capacity constraint. Like you were saying, over a five, six years time, the demand will be met. Sir, can this new product disrupt our product or not? What is your view on this? He is saying anything for a different product or a company is not right on my part. As far as DI is concerned, actually, in India, in this space, OPVC is not even 5% of India's demand or something. There are lots of issues on plastic pipes. Plastic pipe may be UPVC, HDPE or OPVC. Things may change or the quality and things may change. But there are some issues still in terms of longevity and the life cycle of pipes where DI commands the upper hand, which is there in all the departments on a perennial basis. So any product that comes will have a different market. Whether it will replace HDPE or how it will change the plastic business, is a different story. But currently, this OPVC has not much threat to DI, and there is a big demand coming. As soon as supply also increases, this demand will be fulfilled too. It is their marketing. It is their marketing strategy. It will not be right to comment individually. Okay, sir. Sir, I just wanted to know what its impact will be in the long term on our business. For the long term, that is a different strategy, marketing. I will ask Rahul to comment on this. Okay, sir. Thank you. Yeah, don't worry. For us, the demand-supply for 5, 6 years for DI is not an issue. Okay, Sir. Thank you. Thank you. Ladies and gentlemen, you may press star and one to ask a question. A reminder to all the participants, you may press star and one to ask a question. The next follow-up question is from the line of Pradeep Rawat from Yogya Capital. Please go ahead. Thank you for the follow-up. Sir, I had a question related to exports. Like you said, even in India, the supply is deficit, so the demand for DI pipes is good. In the coming time, if the supply of DI pipes matches or slightly exceeds the demand, can we look at the export market for DI pipes? Obviously, I am sure we have. Export market for DI from India is viable for other countries, and it can be always an option for us to sell in the export market. The product is well acceptable, and we have all approvals and everything. Whenever you want, you can penetrate the export market. Okay, sir. Sir, is there any major threat from China in DI pipes, or is our cost competitiveness a little better there? India has a very well cost competitiveness from China as well when we are competing to the other countries. Many countries, China is restricted also. Everyone doesn't want to have a Chinese product. Okay. Thank you very much for answering the question. That's all from my side. Thank you. Thank you. Ladies and gentlemen, you may press star and one to ask a question. A reminder to all the participants, you may press star and one to ask a question. As there are no further questions, I would now like to hand the conference over to the managers for closing comments. We would like to thank everyone for joining the call today. I trust we have addressed all your queries and to your satisfaction. Any other remaining unanswered questions, please do not hesitate to contact our investor relations team, Go India Advisors. They will be more than happy to assist. Thank you once again for your time. Thank you. On behalf of Go India Advisors, that concludes this conference. Thank you for joining us, and you may now disconnect your lines. Thank you.