Q3 25/26

Feb 9, 2026

Quarterly report

Summary

Q3 consolidated income grew 33% YoY, with EBITDA nearly doubling and net profit up 65%. New-facility ramp-up, bus-AC expansion and data-center demand are central to the growth outlook.

Ladies and gentlemen, good day and welcome to KRN Heat Exchanger and Refrigeration Q3 and 9M FY26 earnings call. As a reminder, all participant lines will be in the listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the 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 Ms. Hiral Parekh. Thank you, and over to you. Thank you, Hina. Good morning, ladies and gentlemen. On behalf of Dolat Capital, I am pleased to invite all of you to the Q3 FY26 earnings conference call with the management of KRN Heat Exchanger and Refrigeration Limited. The management is represented by Mr. Santosh Kumar Yadav, Chairman and Managing Director, Mr. Sonu Gupta, Chief Financial Officer, and Mr. Jitendra Sharma, the Company Secretary. With that, I will hand over the call to Jitendra sir for the opening remarks, following which we open the floor for questions. Over to you, sir. Thank you, Hiral. Good day, everyone. Thank you for joining us today on behalf of the management team of the KRN Heat Exchanger and Refrigeration Limited. I would like to warmly welcome all our investors, analysts, and partners to our earnings conference call for the third quarter and nine months period ended FY26. We appreciate your time and your continued interest in the company. This has been a solid quarter for us, and we are pleased to share our financial performance and would like to outline our growth objective going forward. KRN's journey over the last several years has been built on a simple and consistent approach. We have focused on doing the basics right, executing orders reliably, investing steadily in capabilities, and building long-term relationships with customers who value quality, customization, and delivery assurance. From a single manufacturing facility and a limited product range, we have gradually scaled our operations, expanded our product portfolio, and strengthened our presence across multiple end-use segments within HVAC and refrigeration. This steady evolution has helped us build a resilient business that can grow across cycles rather than chase short-term opportunities. The broader industry environment has also been supportive. The HVAC and refrigeration sector continues to benefit from strong structural tailwinds, including urbanization, infrastructure development, rising demand for energy-efficient cooling solutions, and increasing focus on indoor air quality. Growth in data centers, commercial buildings, transport refrigeration, and industrial cooling applications is creating sustained demand for reliable heat exchanger solutions. At the same time, global customers are increasingly looking for trusted manufacturing partners with consistent quality and the ability to scale, which positions companies like ours well over the medium to long term. During the quarter and the 9-month period, demand was strong across India and major export markets, including the U.A.E., the U.S., Canada, and Europe. Coming to the financial performance, I will first touch upon the standalone numbers for the 9-month period ended on the standalone basis. Total income for the first 9 months of the FY 2026 grew about 58% year-on-year to approximately INR 485 crore. EBITDA for the period stood at around INR 67 crore, reflecting growth of about 32%, while net profit increased by nearly 49% year-on-year to about INR 54 crore. On a consolidated basis for the 9-month period, total income stood at approximately INR 428 crore, representing growth of about 40% compared to the same period last year. EBITDA for the 9 months grew up by 53% to around INR 79 crore, while net profit increased by nearly 40% to about INR 53 crore. Looking specifically at the third quarter, consolidated total income for Q3 FY 2026 grew by about 33% year-on-year to roughly INR 155 crore. EBITDA for the quarter nearly doubled to around INR 31 crore, and net profit for the quarter grew by 65% year-on-year to nearly INR 23 crore. Overall, the quarter reflects steady execution and improving operating performance as the business continues to scale. As we look ahead, we remain confident about the growth trajectory of the company. The industry outlook remains positive. Our order pipeline is stable, and customer engagement across domestic and export markets continues to be encouraging. Our focus remains on disciplined execution, improving operational efficiency, expanding our product offerings in a calibrated manner, and building a sustainable business that can deliver consistent performance over the long term. Before I close, I would like to sincerely thank our employees for their commitment and hard work, our customers for their continued trust, and our partners for their ongoing support. What we have achieved is the result of our collective effort, and that support motivates us to keep improving quarter after quarter. We look ahead with confidence and optimism. With that, we would like to happy to take your questions. Thank you. 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 touch-tone 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 a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Mohit from Shubhlaxmi Research. Please go ahead. Hi. Good afternoon, sir. Am I audible? Yes, good afternoon. You are audible. Yes, sir. You are audible. Sir, my first question is, in my opinion, numbers are very good. We are already at INR 150 crore in the net per quarter. I was wondering, with the new plant kicking in production, it could have been better than INR 150 crore. Could you throw some light how does Q4 and FY 2027 overall look in terms of ramping up the production at new plant? Yes. The new facility, of course, is on ramping stage and finally, full-fledged, we are going to inaugurate our new facility on 11th of March. I also inviting all investors to come on 11th March for the inauguration ceremony of our new facility officially. Earlier office was not completed, but now final stage. We are going to inaugurate on 11th of March, and then we will shift to our new office, new facility. I want to share some numbers in term of new facility billing. Last quarter we added almost 40 plus new customer from new facility only, and we did FG sales to them. It means number of customer increasing well, and of course, sales is ramping well in this quarter. Currently, you will get some good numbers, including new products as well as our existing products. Also bus air conditioning also started well. This year what we promised we are going to achieve some, of course, not good numbers, but in term of starting phase, good numbers from bus air conditioning as well. Okay, sir. Noted. Yeah. Thank you. You were saying something, sir. My second question is on input cost. We are seeing increasing volatility in aluminum and copper. I am wondering how is it affecting the current order book and the current purchase order we are receiving in terms of our gross margin. I know the order book is short cycled, probably 2 to 3 months, but can it lead to 1 to 2 point of depressed margin for us? For us, I can say we are receiving some inventory gain, of course, because we always keep 2 and 2 and a half month inventory and some 20 days or 1 month inventory under transit. Of course, metal is increasing, but we can change our price up to quarter only. Last we changed our price from 1st of December, and now we will change from 1st of April 2026. As a particular in case of us, we have almost 2 and 2 and a half month inventory in our hand always. So no direct impact. But it's converting, I think, gain only to us. And we change easily our copper LME, aluminum LME and of course USD to INR in quarter basis. That we are doing only with all customers. Oh, okay, sir. That was very understanding. Hi, Mr. Yadav. I was just wondering if I can continue with a few more questions, sir. Yes. Mr. Yadav, hi, this is Prateek, Shubhlaxmi Research, same team. Mr. Yadav, I was just wondering about the initial signals you have been getting from your team on our bus AC pursuit. How has been the approval from OE customers? How is it going? Also in terms of converting an OE from an existing supplier to KRN, how easy or difficult you are finding it? Because I'm sure this is a new business for us, there's a learning curve for you also. If you can throw some light there. Yes. In term of bus air conditioning, for us, of course, it's new product. But if you see main component of the bus air conditioning is heat exchanger, then FRP and then tubing, and of course compressor and controls. In term of backward integration, we are on the top stage if you compare with all Indian manufacturer because we have our Right heat exchanger and we are the best one, and then we have tubing, and then we have in-house FRP. Of course, control fan and blower we have to buy from the reputed supplier, same like our competitor buying. You can say we can maintain the right quality and of course right cost as well. About our experience, because our partners have almost 12 year their own experience, and before that also they have experience with OEM. So they have market contacts, they have reputation, they know the product, and of course they are not selling well in previous time. But now with our support of finance and our product of quality, they are able to convey to customer. Of course, we already started one OEM in last quarter only. As I said, we added almost 40 new customer in last quarter. I think 10% to 15% only belongs to bus air conditioning only. However, some big OEMs, we did the NDA, but supply not started yet. Hopefully within this quarter, we will be able to supply with two or three big OEM as well. But all OEMs will take time. That is, I am sure, so next year, because as I understood, market is almost around INR 1,000 crore plus for bus air conditioning in pan-India base and is growing 20% to 25% year-to-year on basis. So next year we are expecting at least cover the 15% of market of total top line of the India market, with some OEMs and as well as some bodybuilder and some aftermarket clients. Understood, sir. This is very helpful. Just a follow-up on this. I was wondering, has the supply started to any of one customer, or it will take some more time in the coming quarters? No, already started with one OEM in last quarter only, and this quarter is continuing going on with the same OEM. Got it. And this is the final customer OEM himself, not some tier-1 or tier-2 vendor. No, no. It is final. Final user. Okay, great. That is great, Mr. Yeah. I have two more questions. I will join back with you. Thanks a lot. This was very helpful. Thank you. Thank you. The next question comes from the line of Rajat from Fortune. Please go ahead. Am I audible? Yes, sir, you are. Yes. Yeah. Sir, I just had one question regarding the new acquisition of the bus air conditioning system from Sphere. I just wanted to know what was the cost of the acquisition. Secondly, you had estimated the revenue it will bring will be around INR 160 crore in the next FY. Do you stand with it now? What will be the margin profile for it? Yeah. So, cost, of course, we cannot disclose, but it is not much. If you can maybe study from balance sheet, it will be okay. About market share, what I said, key top line is INR 1,000 crores, so be able to achieve 15% of course from them in next year is on the right track. And margins, if I talk about gross margins, so it is better than our existing product because we do complete assembly and we have backward integration in term of sheet metal, FRP and then tubing and of course heat exchanger. Okay, that is great. So it will be more than 20%. That is what I wanted to know. Yes. Yeah. Perfect. Thank you. That is all from me. Thank you. The next question comes from the line of Manish Ostwal from Nirmal Bang Securities Private Limited. Please go ahead. Yes, sir. Thank you for the opportunity and good set of numbers in delivering the good execution on a guided strategy. Sir, I have only one question on the working capital side. Because of the rising commodity prices, do you see stress coming up for us? What is the net working capital days as on December 31 compared to March? It is still, of course, both is increasing metal pricing and of course we receive some samples from our local manufacturer, but still we are not buying majorly. Once they settle down in term of quality, and I think price structure also not good for us because as of now, in case of import, we have some credit limits from them, some with LC and some without LC as well. But domestic manufacturer, they are not open credit for us, of course, I think for not all. We are expecting they are settled down the things in term of quality and of course pricing and then payment term. Then we slowly will start to buy from them for copper tube and as well as aluminum foil. Then inventory will be settled down because now our inventory in term of existing business of course is same way or maybe slightly up. But other business also we have to build the inventory for other components. It is like bar and plate and then refrigerator component and then bus air conditioning. We always do, in term of inventory, we always keep some stock. We call this minimum level stock in ERP, and then we work based on our forecast. First inventory we have to almost build or some maybe going to build for these new components. What is the average If I conclude, it will be maybe after like one quarter or two quarters you will get things. Once domestic will start, then it will be maybe some slightly downside, but it is still same or slightly up. Okay. And sir, on average input inflation for us, our raw materials compared to our price hike, what has been the action during the quarter? For us, as I said before, we always keep 2.5 month inventory on hand and then some 20 days or one month under transit. Then quarterly basis, we can able to change to our customer. So directly it is not to us, even we are receiving some gain only. Last one long-term question, because now we are hearing a lot of investment proposal in the data centers in India. Even Airtel is talking about big data center setup in the recently concluded call. Do you see we are going to set up one facility in the southern region also, that which you talked about in past? Has the possibility increased for that investment to come up now? For data center, we always are positive because as I said before also, even in term of data center, pipe manufacturing or heat exchanger manufacturing, we are not top because data center heat exchanger size is quite big and earlier in old facility, we do not have such infra or space or you can say finance support, we can able to achieve big numbers from data center. But now we are on the leading space because we have already new facility with big infra, big capacity. And if I convert in as of till quarter 3, we achieve almost 15% of our top line from data center only. And since last 2 months, we are receiving good orders, some big orders from data center only, and of course, inquiries under pipeline. We are hoping in next 3, 4 years, data center will be big numbers for us. Whatever I said before also in last call, we expect at least whatever order will raise for data center, particular for heat exchangers, we will be contribute at least 50% of the total order for India market. Like you said, 15% data center, it can go 40%, 50% next 2, 3 years, sir? I think it will increase, but the other segment also increasing. So in term of percentage, I unable to convert, but whatever order will raise, we can achieve 15% of the India market. And because our other segment also parallelly going on, so that maybe we can make some calculation or some sheet, and then I can share. But I unable to convert in percentage. However, it will increase. Because if you last year, I think we are only 7%, now it is at 15%, and in coming year, for sure it will increase. But it is only heat exchanger segment, because we are doing other component, complete bus air conditioning, bar and plate, and then refrigerator component. So on total top line, what will be the percentage, I have to calculate and then I will share. No problem, sir. Thank you so much and answering all my questions. Thank you very much. Thank you. The next question comes from the line of Meet Shah from Finance360. Please go ahead. Thanks for the opportunity and congratulations on the great set of numbers. My first question is on overall demand, I mean, in domestic and international market. Also, if you have seen, last one month is full of events. India has signed a trade deal with European Union, which is, I guess, the biggest markets. So what kind of demand are you expecting from this market? Because since your export percentage is also increasing in terms of revenue, so how price competitive are we in terms of our peers, like China or Vietnam? If you can throw some light on this. Yeah. If I summarize your question, answer. So, actually what happened, we added new geometry, especially for Europe and of course, U.S.A. market. So of course, because of tariffs, there was some pause because new inquiry we had, but we unable to convert in order because of tariff. But finally, U.S.A. have, of course, reduced, and now final numbers on what component, what will be the percentage still we don't know, but it will be the maximum 18%. So we had one exhibition in U.S.A. last week only, and it start from the announce, so that is good. So still my team is in U.S.A., and they will be at least for one month to meet our existing customer. And we have a good inquiry, good RFQ from both market, for U.S. and Europe. But finally, some we received, of course, from new customers, some sample order and some pilot like order. It will be convert soon. Secondly, our laboratory also started initially, so now we can test the heat exchangers also in our laboratory. Even last week we did for one of our customer. Adjusting was it like, if you can say INR 100, so we are able to achieve same capacity, INR 90 as well. So we can save at least INR 10 on same capacity of heat exchanger. We change the tube diameter, like from earlier it was 7 mm, now we convert it into 5 mm. If you see U.S.A. and of course Europe, so both market, we will going to target. Based on that, we built our capacity or in term of capability, like number of geometry and number of tube. So both, we hoping good, and number we'll see in coming quarters from both of the market. What you said earlier, so I think maybe I missed. It is okay or something I missed? Yeah. The question was more on how competitive are you on pricing terms? I mean- Yes. My understanding is after net of tariff, we would be 15%-20% lower than our peers like China and Vietnam. So in term of our peer, of course, we are not Vietnam. There is no manufacturer who can able to supply to Europe and U.S.A. market. Of course, some Chinese you can see in term of mass production, but we are not targeting as a peer to Chinese supplier. So we always target to our European supplier or U.S.A. supplier. So from them, of course, 15% was quite high, but now we can able to on same tariff, of course, Europe almost zero, so it is okay. So if I compare to European supplier to my price, it will be maybe 15%-20% less landed price, and of course, U.S.A. on same way. So if I to conclude, like target to Europe and U.S.A. with European and U.S.A. suppliers, so we can able to give to our customer 15%-20% of value on our product. Sure. Got it. So my next question is on the newer capacity utilization. I think for this quarter it is around 6% kind of a number. We have earlier guided to 20%-25% for Q3 and Q4. So even if you are doing 20% for Q4, it comes around to INR 100 crores of revenue from newer capacity. So is your guidance still intact or is there any- No. Actually, the guideline is same, is 20% we are going to achieve and its numbers, because consol you can able to see, but actually we are doing inter-billing, inter-company, like for raw material and then because some of our export customer and domestic customer, we are making product in KRN HVAC, but we are supplying from KRN Heat due to vendor code not open or formalities of quality process is not completed. So KRN HVAC, we achieved till now INR 100 crore plus already in last three quarter for finished good. So this quarter number will increase and I think guideline will same, we can able to achieve around 20% of capacity from KRN HVAC. But this number, if you consol, I think you can able to see KRN HVAC number seems less, but actually it is upside because of inter-billing. Okay, sir. Got it. And sir, my next question is on bookkeeping. If you see the effective tax rates of this Q3 compared to the last year's Q3, it is coming around, for this Q3, the effective tax rate is around 12%. For the last it was 28%. Also a follow-up question on EBITDA margins as well. For consolidated EBITDA margins, we have seen the improvement, while for standalone it has contracted. Right? So I was thinking it should have been other way around because lots of costs are coming up, so it would drag consolidated margins and standalone margin would remain intact. What we analyzed, there is the three reason. For tax, of course, the calculation of the deferred tax, that's why tax rate is low. And margins, EBITDA, you can mainly two reason. One is the inventory gain and second one is the backward integration. Because now, earlier we buying products from outside option, like in term of header and sheet metal, but now we are under option making in KRN HVAC, and then we are billing to KRN Heat. That is the reason only. Okay. But sir, in standalone the margin has contracted by 2.7%. So what's the reason for that? No. Standalone, if you see, because that is including raw material on the top line. Of course, raw material we are unable to make the margins. Okay. Okay, sure. Okay, sir. Sure. Got it. Thank you. The next question comes from the line of Mitesh Bhandari, an individual investor. Please go ahead. Sir, good afternoon. My question continues in line with some of the earlier questions, though I was not able to get the exact guidance. What will be the guidance in terms of top line and bottom line for Q4 and at the same time next financial year? When you say there is some inter-billing, if you can give a little more clarity on the inter-billing, the subsidiary numbers are also included in the guidance which is being given. There is two thing going on inter-billing. One is, because we have some limited, like LC limit in KRN HVAC and some vendor code is not open well, raw material we buying on KRN Heat Exchanger and then we billing to KRN HVAC, some material what they need. Secondly, like semi-finished product, like sheet metal component and header we are making in KRN HVAC, then we billing to KRN Heat. This is the main reason of the inter-billing. Second, guideline of the capacity utilization is remain same, we are going to achieve around 20% of the capacity from KRN HVAC and next year we are going to achieve around 50% off from KRN HVAC. Of course, KRN Heat almost full, there will be no able to increase on capacity. In terms of total numbers, what is the revenue which we should expect for Q4 and for next financial year, sir? Number, of course, I cannot share, but capacity utilization I already described, so maybe you have to calculate. Okay. Fair enough, sir. With respect to the exports, you have clarified now the U.S. and Europe market, et cetera, are now a little better position now the tariff positions are clear. But we have also been doing some export to Saudi and Middle East, et cetera. Are we seeing any growth and continuity in orders, repeat orders in that market or further penetration in the Middle East market as well? Middle East market, actually we have same customer and we are supplying to them and you can see number is increasing well from UAE as well because UAE market also doing good. Even last quarter we already declared the news, we got one almost INR 24 crore single order from UAE market only. This what we are going to supply. Okay. Do we further continue to tap the UAE market or our focus is going to be initially more on U.S. and Europe? Actually, UAE market for us is not so big, so whatever customer we are supplying, of course they will remain same. Whatever they are increase, we will enjoy. However, our main focus is on Europe and U.S. market. Okay. Fine, sir. Thank you. Thank you. The next question comes from the line of Jitesh Thakur, an investor. Please go ahead. Yeah. Good afternoon. Can you hear me? Yes. First of all, Mr. Yadav and team, congratulations to the management team on a strong and more importantly, consistent execution. I have a larger vision to share and to just to know, as the company is clearly on a strong growth trajectory, good governance and strategic guidance has become very important. Could you share some insights on how you are strengthening the role and composition of independent directors for the expected growth that we can see in the coming years? As of now, whatever we have, four, of course, experts from CS side and finance side, we are taking advice on the meetings from them. In coming years, we will try to add some more experts or industry experts or you can say professionals, much more. We will add maybe one or two, three. Maybe next year you will be able to see on our board. As of now, four independent directors, they have expert in two in finance and- Yes. Yeah. Okay. But yes, there is a strong suggestion because as I see, as you are growing on a very, as per your guided trajectory, a strong and able independent directors would really help you in the effective checks and balances in the company as the company is scaling up. Thank you. Yeah, thank you. We note down your suggestion, but however, we are working on same as well. Yeah. Yes, please. Thank you. Thank you. The next question comes from the line of Manan Goyal from ICICI Securities. Please go ahead. Thank you for the opportunity. Just wanted to check, like you mentioned. Hello, am I audible? Yeah, now you are audible. Yes, sir, you are. Thank you, sir, for the opportunity and good set of numbers. Just one question. You mentioned that you will be able to achieve capacity utilization of 20% in FY 2026, and the maximum revenue piece heavily from this new capacity will be around INR 2,000 crores. If I do the math, then around INR 400 crores will be coming from the new capacity, right, in FY 2026? No, I think there is some maybe confusion because our earlier was, because numbers, of course, I cannot share in detail, but our total, what we said when our turnover was INR 300 crores and then 6x if you compare to, so the total capacity of the including existing and new facilities like that. From new facility, we are going to achieve around 20%. So that is the calculation. Okay, understood. Got it, sir. I see that your gross margin on a consol basis like- Your voice is not clear. Can you loudly? Hello. Am I audible? Yeah. Yes. Yeah, I see that your gross margin on a consol basis has contracted by around 5% year-on-year. If you can give me the reason for this regarding. I said before, there is two reason which seems to visible clearly. One is inventory gain and second is the backward integration in term of sheet metal and header component. No, like- And also. Yeah. Yeah. I just want to know, they are contracted. They contracted on a consol, on a standalone basis, but they have contracted on a consol basis. The main reason is inventory, right? So consol base, because in HVAC we are making this backward integration and also new component like bus air conditioning and bar and plate also from HVAC and there is our margin is slightly up compared to existing product. Okay, got it. Thank you, sir. Thank you. Next question comes from the line of Mohit from Shubhlaxmi Research. Please go ahead. Hi, Mr. Yadav. Thank you for the opportunity again. This is Prateek this side. Yes. Mr. Yadav, I just wanted to understand the behavior of suppliers at this point of time because I know you have alluded to this question earlier, but just wanted to get some more sense on it. Since the volatility is so high, are the suppliers working on as and when basis or are they honoring the commitment or they are revising it very quickly? How has been the behavior of the suppliers at this point of time, particularly for aluminum and copper? Will it be possible for you to break up the bill of material BOM roughly how much aluminum consists of it and how much copper contains? For us, of course, aluminum foil, we have you can say top of the supplier from the world, so they are reputed, so they can't do anything. Whatever contract we have, they are honoring well. However, in copper, there is one slightly change, earlier LME we can book like settlement of the during the day, we call CSP, but now they send the letter to all OEM, not to us, they have to charge some premium because volatility is too high and they are backward, I think, from their buying cathode, so they have to charge as a premium, particular I think 200 USD. So that they planned to let it to us also. However, as a supplier because we have for copper three to four suppliers, they are also top one in the world, so they can't because our buying is also good, so they are- Right keeping as well. Secondly, main component in our cost is of course copper, which contribute, I think, to 40%-50% based on right product, and aluminum contribute 10%-15%. Understood. This is very helpful. Aluminum 10%-15%, copper 40%-50% of our BOM. Yes. This is very helpful. Mr. Yadav, the second thing I had in mind, I would like to get your opinion also. This is not an ask from you at this point of time, since business is evolving and graduating from here. Will it be possible going further to share some order book status or some number there, what can be the execution in, say, next 6-9 months or one year time frame, given these are very hardcoded contracts from the customers? I said before also, because our customer is not project-based, so of course, slightly project-based also, 1% or 2% you can say, but our order book is rolling based. Okay. Like our main customer, they spare us almost six months of their total forecast, then one month is firm order, then it's rolling. Got it. For data center, we are receiving some big orders, like single PO. You can say earlier it was less number, but now it's really a good number of single PO. That is, we are going to achieve good numbers from data center. Got it. No, understandable. Yes. One small question. Talking to many capital good companies, Mr. Yadav, we get a sense that to a certain extent, few customers are also in a wait and watch position, to an extent where they have kept the orders on furlough, where they are just waiting and watching because of, one, this raw material thing, and then second, the geopolitical issues also. Are we also facing any of this challenge in our business, Mr. Yadav? No, because our customer is not a project company. Like I said, of course, if data center like main company like Google, they not release the order to our customers, of course, they will not come to us. But once they have order, they of course, send order to us because delivery they need some time, 2 or 3 months. So maybe- Got it the main customer can wait the metal, maybe settle down the things, but our customer is not on the same page. Understood. It might trickle down, but as of now, it is not happening. If Google stops the PO or, let us say, puts anything on furlough, it might trickle down to us, but as of now, you are saying it is not happening. Yes, for us it is not happening. This price is slightly, of course, up, but because we work on an average, so directly not- Yeah into our customer as of now. Understood. Very important. Just last question from my side, Mr. Yadav. Any new significant hire at the top management level we have done? I know we are working on it, so just wanted to get an update. Nothing more than that. No, if you see, of course, on the last part, I think, Manish, I think before last part it happened. We have export sales president, and we have one president for food and non-food business for this dry cooler and ammonia business. Then three director we added as operation director in bus air conditioning, and earlier team was quite old, but now still some middle management or some, maybe one or two top management still we are searching. Hopefully within this quarter also, we will fill whatever is required. Got it. I just missed the second part. After the chief of sales exports, the second position you discussed about. There is one sales president for food and non-food business, particular for complete product like dry cooler and ammonia. Okay. You mean the chillers or the freezers which are inside the shops, et cetera? No. If you see our websites, we give now- Okay we updated our website and there is the detail- Okay about our all products. Food business also You can see we added refrigeration and complete HVAC system. So there is, you can detail with photographs, so maybe you can study. No, I will definitely go through it. Very helpful, Mr. Yadav. Always a pleasure speaking to you. Thanks a lot and good luck. Thank you. Thank you. Thank you. The next question comes from the line of Vignesh Iyer from Secquent Investment. Please go ahead. Mr. Iyer, please proceed with your question. Am I audible now? Yes, sir, you are. Yes. Sorry. Thank you. Thank you for the opportunity, Mr. Yadav. My first question is on the current order book that we have. Just wanted to understand with so much volatility when it comes to raw material, are these orders cost-plus orders where we pass on any rise in the raw material cost, or how is the agreement in general with our customers? Our order, of course, are not linked to material volatility because we work on average. Now we are applying October, November, and December, and we are able to supply January, February, and March. Our price will change from 1st of April based on this running quarter average. Same contract we have almost with all customers, and they agreed on that, and they are continuing with orders, because main customer is not project-based. They are running whatever output they have to achieve, so they have to order each section. Of course, we have to supply on the same rate. It is not linked to, they are waiting for material to settle down the things, and then they will release order to us, and then we will execute, because we work on average only. How do we book our raw material? When we get the order, do we book the raw material immediate basis when we get the order to hedge ourselves? No. Roughly, if I need 300 ton copper tube in a month, we plan our full container load. One container, 20 ton, and then based on then size and based on that we make the container full, one size or sometime two size in one container. Then weekly basis we settle down the LME and then we. Before we raise the order to our vendor, and then once the shipment is ready or before the shipment is start, we can book the LME. Based on that, they apply the LME and then they supply to us. You can say similar to average way. Okay. So it will be fair to assume, right, sir, that there is some risk of raw material in our books when it comes to such contracts. Right? Because the order that we have booked and the average price would have some difference in terms of value. Sometime if ordered, we not link to our booking with order. We link to whatever we has to use in 3 months and then we apply to our customer base 3 month average. So in term of total, if you see, it is linked, maybe some order, if you link to, we are doing on 11,000, but we booked on 13,000. But next month we will bill maybe 13,000, and of course, we buy maybe 12,000 or it can be 14,000. But quarter to quarter basis settle, but it is not because we always keep 2 and a half month inventory and of course 20 days or maybe sometime 2 week or 3 week under transit, so it is direct not it to us and of course not to our customers. Okay. So just one more question. I might have missed your commentary earlier regarding Sphere Refrigeration Systems. So can you tell me what is the total revenue of Sphere Refrigeration Systems and what kind of growth can we see from next year? Sphere Refrigeration and Beriwal, the two companies they have. One is Sphere Thermal and one is Sphere Refrigeration. Main business they do in Sphere Thermal, but they already had some agreement with some other guys, and they already sold that company before six months aligned with us. We bought Sphere Refrigeration, so they have not good numbers in Sphere Refrigeration. Very less, I think top line, maybe 2 or 3 crore only. But Sphere Thermal, they did, I think, 40 or 50 crore, and they did this business around 12 years plus. But market scenario is like that. Market is total almost INR 1,000 crore plus in India as of now, and it is growing 20%-25% year on year basis, and both for electric bus air conditioning and conventional bus air conditioning. We are making both electric bus air conditioning and conventional. Of course, this business main thing is you have to open service center pan India base because customer needs service on immediate basis. We already opened four service centers in India. One is in Indore, one is in Noida, Delhi, and Ahmedabad we are going to open. Our target is in next six to seven months, we will be able to open at least 20 to 25 numbers, service center pan India based. We already hired almost 10 to 15 sales team. I am going to hire, already I hired some numbers, I think 50 plus service technician, but still we are going to hire. If you can see, in next six months, we will have complete pan India-wide service center with technical team, service team and the sales team. That is the main criteria of this bus air conditioning business, which we are going to achieve 15% sales of top line from next year. 15%? Sorry, I missed the 15%. For top line, bottom line, bus air conditioning complete business. We are going to achieve around 15% in next year. Of our total sales is what you mean? Mm-hmm. For total sales of bus air conditioning in India. Okay. This product primarily would be manufactured in our new facility, right? Yes. It's already started. Last quarter also, we did some billing, and this quarter is also we are going to billing, including one OEM. Okay. Sir. Got it, sir. That's all from my side, and all the best, sir. Thank you. Thank you. Thank you. The next question comes from the line of Aditya Sharma, an individual investor. Please go ahead. Hello, am I audible? Yes. Sir, considering the recent investment in the bus AC segment, could you provide some guidance on its expected revenue contribution over 2 to 3 years? This earlier question is the same because this coming year we are to see revenue of 15% of the bus air conditioning industry total market size, and then of course there will be 30%-40% of the growth, because industry also growing on same way, and we are the new. Based on our backward integration and our quality of the product, we will be the one of the key vendor for bus air conditioning industry. Okay, sir. Thank you. The next question comes from the line of Tej Patel from Niveshaay Capital. Please go ahead. Hello, am I audible, sir? Yes. Thank you so much for the opportunity. Sir, I just wanted to get an idea on the data center side of the business. Today, if you look at the major heavy suppliers, are the customer to us, maybe, I mean, just wanted to understand today all of the data center heavy suppliers, are they customer to us? When you say 15% of the revenue in this quarter came from data center, is it India or is it some other country? As of now, major from India only. Slightly we did export also for one of our customer in Europe for data center. You can say main revenue in India. As of now, we have almost all except one. For one also, we did like NDA, and they asked last week for bidding, and we did the bidding, and we have L1 position on bidding. We are expecting, hope we will start from this one customer also, who is majorly in data center. Other than one, already we are supplying to all for data center. That's why I'm saying whatever revenue will come in coming year from data center, our percentage will increase. We're expecting 50% of total revenue to us based on our quality and, of course, infra and new facility and our cost. Got it. And sir, when you say L1, is it project to project basis? Or when you say you are L1, so you have entered the supplier list, and are you the sole supplier for that HVAC system supplier or it will vary? They have some process to year-on-year basis. Whatever their total buying, so they compete bid, I think, with more than, I think, 80 or 90 SKU. So they bid the quantity and then price, and then total price comes, and then we did the bidding. Based on that, we are L1. So now consolidation is going on for bidding, and then I think we have to supply to samples, and then supply will start. So L1 is we are already existing supplier, and they entered us as a new supplier. Okay. Is it right to assume for any projects that your current HVAC supplier gets, you would be the sole supplier in India? No. Based on project to project, but we are not sole supplier for all. Of course, you can say some of customer we are the major supplier, so maybe 80% we and maybe 20% they are buying from our competitor, some is small quantity. So it is based on like project or their regular requirement, they decide it, and then they open the order. Got it. For the 20%-30% of the suppliers who are competing with that, is it all imported or is it manufactured in India by some MNC? Manufacturing in India, but one MNC you can say, but other is Indian supplier only. Is it possible to name the peers? I think as of now, unable to share. However- Okay. We will share. And sir, when you say you are receiving incremental inquiries for the data center, is this the India market or the Europe and other UAE markets? Because what we understood, UAE also pushing hard for the data center CapEx. I just wanted to get your view on the inquiries part of the side. Is it India or exports as well? So majorly, we are receiving from India only. However, we have inquiry from U.S.A., one of customer for data center, and Europe as well. For UAE, I think there is no local manufacturer there to make the data center. However, whatever is top 10, so almost six to seven we are already supplying to them. So I think if they have new facility in UAE, of course, we can able to supply to UAE. But as of now, we did not have inquiry from UAE for data center, but we have from Europe, U.S.A., and of course, majorly from domestic. Okay, got it. And sir, for liquid cooling, do we have solutions? Because I think there is different kind of heat exchangers are used, right? I just wanted to understand that part of the business as well because Liquid cooling have two options. One is we call CDU, and CDU have, I think, plate heat exchanger, which we are not manufacturing, but outside is the same heat exchanger, maybe chiller or dry cooler. For chiller we are making and, of course, for dry cooler, we are making heat exchanger, as well we are making complete dry cooler as well. Okay. But for D2C, we are not making the heat exchangers like the air one. Okay, got it. Still, for CDU. CDU we are not making it. Got it. Perfect, sir. Thank you so much. That helps. Thank you. Thank you. Ladies and gentlemen, that was the last question for today. I would now like to hand the conference over to Mr. Santosh Yadav for closing remarks. Thank you all for joining. Again, I request all investors to come to our opening ceremony of our new facility on 11th of March. If possible, please book your calendar and send the information by mail to our CS or maybe to me. We will maybe take care of the logistic part, and of course, if need some timing, we will share. I am expecting same good numbers in coming quarter, including data center, of course, from export side. Thank you. Thank you to all. Thank you. On behalf of Dolat Capital Markets Private Limited, that concludes this conference. Thank you for joining us, and you may now disconnect your lines.