Q1 21/22

Jul 21, 2021

Quarterly report

Ladies and gentlemen, good day, and welcome to the Supreme Industries Earnings Call hosted by TAM Capital Advisors Limited. As a reminder, all participant lines will be in the listen only mode, and there will be an opportunity free to ask questions after the presentation concludes. Please note that this conference is being recorded. I now hand the conference over to Mr. Asim Bharde from DAM Capital Advisors Limited. Thank you, and over to you, sir. Yeah. Thank you, Melissa. On behalf of DAM Capital Advisors, I welcome all our participants on Supreme Industries q one results conference call. I sincerely hope you all are doing fine and well, and I also thank the management for giving us the opportunity to hold them on this forum today. From the management side, we have mister NP Taparia, managing director mister P. P. Somani, chief financial officer, and mister Rajinder Sabu, vice president, corporate affairs and company secretary. I will now hand over the floor to mister Taparia for his opening remarks. And post that, we can open the floor for q and a. Thank you, and over to you, sir. Thank you very much, sir. Good afternoon. I'm MP Taparia, managing director of the Supreme Industry Limited. I, along with my colleagues, Sri P. C. Somani, chief finance officer, and Sri Ajay Sabu, vice president corporate affairs and company secretary, welcome all the participant who are participating in the discussion of the unaudited standalone and consolidated financial results for the first quarter ended thirty eight June twenty twenty one. The stand alone results and the consolidated results are already with you. I'll give briefly on company's product operating performance and other highlights. The company sold 71,264 tons of plastic goods and achieved net product turnover of rupee 1,310 crore during the first quarter of the current year against sale of 91,461 tonnes and net product turnover of INR $10.40 crore in the corresponding quarter of previous year, resulting in volume degrowth of around 22% and value growth of about 26%. Total consolidated income and operating profit for the first quarter of the current year amounted to rupees 1,346 crore and rupees 267 crore as compared to rupees 1,056 crore and rupees 113 crore for the corresponding quarter of the previous year, recording increase of 27136% respectively. The consolidated profit before tax and profit after tax for the first quarter of the current year amounted to rupee 213 crore and rupee 170 crore as compared to rupee 55 crore and rupee 41 crore for the corresponding quarters of previous year, recording increase of 287315%, respectively. The business scenario of other product segment of the company for the quarter ended thirty June twenty twenty one as compared to corresponding quarter of previous year has been aged under. Plastic piping system business decreased by 36% in volume and grew by 9% in value term. Packaging product segment business grew by 13% in volume and 30% in value term. Industrial product segment business grew by 99% in volume and 184% in value turn. Consumer product segment business grew by 40% in volume and 71% in value turn. The overall turnover of value added products increased to INR $5.60 crores during the current quarter as compared to INR $3.78 crores in the corresponding period of previous year, achieving growth of 37%. The company has cash surplus fund of rupee $3.81 crore as of thirty June twenty twenty one as against cash surplus fund of rupees $7.59 crore as on thirty first March twenty twenty one. Business outlook. During the first quarter of the current year, the business was severely disrupted due to second wave of COVID nineteen. This time, the infection was quite widespread rural areas. Appear in May are the peak season for PVC pipe system for agricultural application. As the rural market was badly affected by the pandemic, the aircraft demand took a big hit resulting in huge volume loss of business and piping segment. The company was just required to carry forward the pipe inventory, which was kept ready to meet large seasonal demand of agricultural pipes. Plastic piping system thus saw a volume degrowth of 36% compared to corresponding quarter in the previous year. PVC prices have started going up now after a drop of 19 per kilo since April 2021. The demand in Construction segment is now revived. Company expects the first quarter loss in volume in piping system not only be recovered, but will show a growth in full year. The upcoming unit to make plastic pipe system at Guwahati will be operational by October 2021. The company's taken in hand to put the plastic product complex in Wisha with an outlay of INR 121 crore in the current year. The same may be operational in last quarter of twenty twenty one-twenty twenty two. Total CapEx planned for the year has now increased to INR $5.21 crore from the earlier INR 400 crore, including tariff for commitment of previous year. Compression molded olefin fittings have gone into commercial production at Darjeela since June to cater to the growing demand in nonurgent scheme. The second wave of pandemic and the resulting localized lockdown adversely affected the demand supply chain during the first quarter, which is a peak demand period for tarpaulins. The production has also taken a hit during the first quarter due to scarcity level on account of large infection in rural area. The silver lining is that the exports have gone up by around 50% in the quarter compared to the first quarter of last year. With the waning of second wave, the levels are back and the production is now running at full capacity. The good run-in export is continuing. The value added product sales in tangible products segment has gone up to INR 23.26 crore compared to INR 13.41 crore in the same quarter of last year. This division is working on digital campaign on several media sites such as Facebook, YouTube, Instagram for brand promotion. Business scenario remains brief in industrial component business barring the initial disruption during first quarter. The division is working with its existing customer for new business apart from developing new customer. Company is putting needless capital expenditure to meet increased business requirement. Material handling product, being intermediately to supply your research and product, have done good good business both in terms of value and volume. Division is now working to introduce various new product application from injection molding and in auto molding process. Expansion of capacity at its plant in Laloop in Punjab and Gadi Gham in Maharashtra is nearing completion and shall be operational by July 2021. In composite LPG cylinder business, equipment orders from existing LNG customers are continuing. Domestic oil marketing company, such as Indian Oil Corporation and BPCL, have also floated inquiry for purchases with August built for the long awaited introduction of composite cylinder in the Indian market. Overall, business scenario for this product looks encouraging. Protective Packaging business has shown good improvement over corresponding quarter of previous year. New product for export market have been well received. Its retail division for Swedish product is also picking up well. Division is focusing on customized solution and value addition to its original equipment customers. Beginning of the current year, all the polymer prices have shown suffering trend. However, after a reduction between 13% to 16% during the quarter, prices again started firming up and expect to remain rent bound. The company is committed to increasingly meet its energy requirement from renewable sources and investing a sum of rupee 35 crore in the current year to install rooftop solar energy land reserve plant at its various plant locations. The same shall be operational by October 2021. This is a brief and overall summary for the first quarter of the year under reference. Thank you for your patience. Now I and my colleague, Shri Prisheshavani and Shri Adya Sabhu, are available to reply to various query you may have. Thank you very much. Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press and one on the touch tone telephone. Session. The first question is from the line of Rahul Agarwal from Incred Capital. Yeah. Hi. Good evening. Thank you for the opportunity. Sir, I had three quick questions. First is this volume which are lost in the first quarter, you are saying, obviously, the pipe volume will recover in the year end, actually, it will grow. So overall, for the full year, given the favorable base last year, should we assume that a 20% volume growth is fair number for the company? I don't believe that because still, anyway, the there's we can't forecast the correct number because there's already a fear lurking of third wave. But as the demand has started coming up properly, we believe last year, we sold two left 94,000 ton plastic pipe system. This year, definitely, we will improve our all the numbers. Beyond that, we cannot commit today. Okay. And, sir, similarly, because of the volatility in PVC pricing, could you help us any sense on the EBITDA per ton? You know, last year, it was about 30,000 tons 30,000 rupees per ton. Will it be similar flat Y o Y this year? Last year, if you 150 rupee, it went again. If you if you say, again, it was around 6 rupees per kilo. Okay. So will that be maintained Y o Y? Very difficult track the numbers. Okay. Fine. And my last question was on CapEx. So this $5.20 crores of CapEx, it looks like the highest number in the history of the company for any given year. What kind of sales can it add? Turnover? What kind? How much turnover can this CapEx of 520 crores add to the top line? Normally, in a greenfield project, we get 1.5 to 1.7 rupee per ton investment. And a brownfield around rupee 2 per per rupee in your state. So out of this 05/21, around 200 rupee be greenfield. Sorry. Right? Yeah. Yeah. Yeah. You are right. Yeah. Yeah. Right. And $3.20 will be brownfield. So if you can multiply by the number what I told you, it may be around 900 square rupees. And they go full production, isn't going to be next year. Got it, sir. I'll I'll come back in the queue. Thank you so much. All the best. Thank you. The next question is from the line of Bhargav Puttadev from Kotak Asset Management Company. Please go ahead with your question. Yeah. Good afternoon, sir. My first question is on whether there was any inventory loss in the quarter? Because if you look at the pipe EBITDA margin, it has held up well at about 21%. There was some energy loss, and as we stated in our opening remarks, we have to carry pipe inventory for the second quarter, and we could not exit in the first quarter. Yes. But, sir, despite such a sharp volume decline in inventory loss, how come our EBITDA margins are still held up at about 21%? Is it that there is some reset in terms of the pipe margin? No. There there was more sale of value added item, less sale of every item, every pipe. Every pipe is a low margin business. Right. And there were good growth in our system. In our c p CPVC system? Yes. Okay. So can we expect this trend to sort of hello? It was combined factor of giving a reasonable operating margin in the first quarter. So, sir, as our CPVC business business has our CPVC business seen a growth? Is it possible to quantify what has been the growth in the CPVC business? In the first quarter, we had a growth of 42%. Forty two % volume growth in CPVC. Compared to previous year. Okay. And for the full year, we can expect double digit volume growth in CPVC, sir? Yeah. We expect like that. Okay. Secondly, sir, given that PVC prices were falling in the first quarter, is the channel inventory? Is it fair to say channel inventory could be one of the lowest in the pipe segment as of now? You are very right. Can I rent it? Are mostly mostly empty. Gotcha. Okay. So is that they could not buy also. Sorry, sir? If they require, they could not buy also due to lockdowns. Okay. Okay. And how is the situation now, sir? Because now you see prices have started rallying back. So are you seeing channel also starting to buy now? Oh, generally, it's still not going to bullish. There's no reason to go to bullish. There's no reason the price to go back to the same old level. Okay. But, Bushi, it's structurally short. Okay. Okay. And the freight cost are very high from Far East and Southeast Asia to India. Okay. Okay. So the landed cost in India increased substantially due to increased freight cost of the containers. Okay. Understood. And today, you cannot get large material from either USA or South America or Europe. Okay. Okay. Okay. And, sir, my last question is on the wild wild business. In the annual report, we have mentioned that we are manufacturing various wild like butterflies, wing check, etcetera, etcetera. So how big will be the wild business for us, and are we doing any CapEx in this business as well? We are investing some money more into increasing a range of us. And how big will be this business, sir, as of now? We started building up, and we expect the build business will go on growing. Besides number, not possible to say. And this will also be qualified as a value added product, sir? Yeah. It is all value added. Okay. Okay, sir. I'll come back in the queue. All the very best, sir. Thank you. The next question is from the line of Girish Chaudhry from Spark Capital. Please go ahead. Yes. Good afternoon, sir. Thanks for taking my questions. So a couple of questions. First is on the volume. Just to better understand this, you mentioned that the main reason is is due to agribusiness. So so how much this agribusiness declined in in volume terms? And then, generally, first quarter is the peak season. So so how much is the agribix in the total business? So total agribix and borewell and column pipe, we lost a turnover about 24,000 plus turnover. Now out of 24,000 ton, some quantity used in housing also. And housing also, there were complete lockdown in South India. So precisely cannot say how much is every pipe in this, but we can safely say that out of 24,000 ton loss in business, 22,000 plus are lost due to poor demand in the segment, measured by AgriPipe loss. Okay. So so this quarter, basically, you're you're you're sort of mentioning that you lost 22,000 tons in the aggregate. The second quarter is not the aggregate season. The aggregate season may start by September, and then we may see some impact only in third on the third quarter in booking demand in the market. July, August is early season. Okay. Okay. Yeah. So second is that on the packaging product, we we have seen this is the only segment where we have seen a decline in margins from the first quarter FY twenty one levels. So so margins falling from 15% to 12%. Any reasons for the same? Is it due to lower fuel falling sales or or or any pricing pressure here? There there are two reasons. One, the lower production in the April quarter of Saint Pauline. And secondly, the South market was mostly remained closed in South East big market during this season. And thirdly, the company can do high cost of material because this is company making all from imported raw material, and we had continuous commitment, which we we keep it for nearly three months our requirement. And the pressure is falling, but we are to consume this high cost material. The three structure combined have reduced our margin across limited film product. Okay. And on the looking ahead, where do we see the margin settling in the segment? Looking ahead, we remain quite optimistic. Okay. Okay. I didn't can it go back to the 15% levels? That's the precise number of differential, but except we will restore our margin fully. We have now restored fully our margin. In our particular packaging segment also, our fitness products are picking up very well. Our exports are picking up very well. And in particular packaging film, we are getting more and more value added items, and we are increasing our export also. So we believe our operating margin for the full year will be quite satisfactory. Got it. Sir, just one more question on the balance sheet. We have seen the cash balance coming down to $3.80 crores as of June versus $7.50 crores in March. So just wanted to understand what what what has led to this decline? Is it CapEx or higher working capital? Due to buildup of inventory and also CapEx, but more like buildup of inventory because we could not exit in first quarter, so we have to carry the inventory in second quarter. Okay. Okay. So so we can expect this to sort of roll back as in when we sales in. Yes. Okay. Got Got it. Thanks a lot, sir. Thank you. The next question is from the line of Kashyap Zawedi from MK Investment Managers. Thank you very much, sir, for the opportunity, and congratulations on quite a strong show in a challenging quarter. I have just one question. In the Hello? Sorry to interrupt, sir. This is the conference operator. There is a disturbance coming from your line, sir. Is just give me one second. You. Just give me one second, sir. Yes. We'll wait. Is it is it better now? Yes, sir. You may go ahead. Thank you. Okay. Sir, congratulations on, you know, quite a strong show in this challenging quarter. I have just one question, which is with respect to some of the comments that we have in annual report. We have spoken about the opportunity opening up in the fire sprinkler system with respect to MS and GI pipes. You know, if you could quantify, you know, what's the total size of that market. I'm not asking what could be potential for us, but what is the total size of the market there and the differential between, you know, CPVC, GI, and MS pipes, you know, as of today? No. Fire street is a total market size. We cannot participate because there are several types of fire street required. Mostly, the vertical pipe system, we cannot participate. We can only light flight bigger system light files for your system only we can participate. And files for your weekend, get full advantage only we get up. It is BS certificate. BS formula BS it is still not formulated for fire sprinkler. But our company is saying that our business is increasing for for fire sprinkler month after month. We expect this year business is better than previous year, but still we are not able to get the larger volume of business because we are all waiting for several years certification program where it is still under the printing process in government of India. Okay. And differential between the cost, if if you can if you have it handy. Cost is actually CPUC power system, yes, much expensive than mild steel. But our CPUC power system is really effective. With mild steel, remaining under pressure of water, the pipe get corroded. And at the time of fire, it will be up to seven, eight years, the water will not come out of the sprinkler. So this is not a cost effective purpose. This is more from the part of safety of the human being living in that building. So our system in Europe and USA now is widely spread. They don't use this mild steel hysteria system. More about shifting and taking place to CPVC. But in the actual system is doing fully in place from the. The business is and we expect that our business is going growing every year. Okay. And if I can squeeze in just one more question. In material handling, what would be the contribution of ecommerce now? Oh, yeah. Any idea? Ecommerce. I I have no idea. No. You see our program, not through the ecommerce route. But what we are doing here is that material handling, you know, products, which are going to ecommerce segment, material handling products. Yeah. Ecommerce companies or large third party companies who are ultimately doing this work for the e commerce companies. Right. Right. So the Mahayas market is definitely going up, and this is the reason of this new business doing well even in this pandemic period also because the e commerce deliveries are having more and the provision required. Now except to quantum on the value is not known, but this this is the focus area where we are working and we are really finding the truthfulness. Sure. Thank you very much, sir. That's it from my side. And, again, congratulations on quite a strong show in this challenging quarter. Thank you, Raj. Thank you. The next question is from the line of Ritesh Shah from Investec. Please go ahead. Yeah. Hi, sir. Thanks for the opportunity. Sir, my first question is a clarification. Did we say that out of 48,000 tons on the plastic piping side, 24,000 tons was agri? Did I hear it right, sir? We said the destruction in demand was 24,000 ton. Okay. Okay. To previous year same quarter, the demand destruction was 24,000 ton due to lower sale of exit pipe, column pipe, and burrable pipe. Out of which, majority has been not to be used by farmers. Okay. Maybe 22,010. Okay. 2,010 might have been used in housing. Right. So, sir, if one had to break up broadly, agri and nonagri, how much should the decline be? Like, did the agri part of the business decline by, say, something like $70.80 percent? How should one understand that? Agri business declined by 60%. Around 60%. Okay. Sir, this this means that the EBITDA per kg, what we have shown on the plastic piping side, it is really, really good. And it will be more like touching what probably CPVC EBITDA per kg would be. So, sir, just trying to understand, has the PVC, CPVC mix drastically changed? You did indicate that the growth of PVC was nearly 42%. So is this the only variable, or are there any other factors like higher sales on tanks, walls, fittings? That is also what contributed to this healthy EBITDA per kg in the plastic piping business, and this is a more sustainable number. Sir, if you could help explain this? CPOC, forty two percent growth has come due to lower base last year. Last year, we can't upgrade by completely closed. And major loss of very much closed in housing. Okay. Because of the we we work workers are migrated. So there is no construction worker available. I'm recalling you the last year first quarter. Sir, sir, my my business worker was not there, and construction actually started. And April was not closed this year. Correct. Sir, has the ramp up on tanks and walls or pittings been significant, which has also held on a very healthy margins over here? No. Business is good. We are we are doing all those business where the margins are healthy. Correct. Sir, what I'm trying to understand, is this a structural shift in the product mix going forward? Sorry. Say it again. Sir, is this a structural change in profitability in the plastic piping business? That is what we are looking at? Yes. Just to change the company business profile. We we are intending to go on increasing the share of value added item year after year. We are intending to increase the share of export market year after year. Okay. This is not restricted because this year, this is going on for last four, five years. Okay. That's that's helpful. And, sir, just I had one more question. In the press release, you have indicated molded olefin fittings, which have gone into commercial production. Just wanted to understand the end application on this on the Agri side. Is this something which is specific and new? Not not for Agri pipe. This goes in house connection. It's only in pipe. Now scheduling scheme is going throughout the country, and government is committed to correct the number of houses by 2024. Correct. Connecting the pipe to the house, you require fittings. Correct? Pipe. Yeah. Yeah. Bleach. Sir, how is this product different from what we already have in the marketplace? Is it something new and unique to us? Unique unique to our company, and definitely, it is different than it cannot be used on PVC pipe. And for the housing connection, they are using polythene pipe or medium density polythene pipe. And for that, you require different type of fitting. It is a very different type of fitting. Sure. Thank you so much for the answer, sir. Thank you. The next question is from the line of Sonali Salgankar from Jefferies India. Please go ahead. Thank you for the opportunity. So my first question is, you know, you in the opening comments, you said that you are hopeful of recovering the loss in volumes with the full year prospectively showing a growth. So what could be the key steps that, you know, the industry has to take into for for showing this growth in plastic bags? For example, any new launches or increase the distribution, etcetera. I think together, distribution launching new product that is now one of the most exciting we have heard. We are going to launch electrofusion polishing fitting, which are required for joining the pipe on infrastructure. We are going to introduce best piping system, which is required for housing or getting hot water. We are building more in our furniture, more capacity in our material handling system, more capacity in this component, and more shall we expect from our component packaging division, more shall we expect from our particular packaging products. Every segment, we are seeing better demand prospect now. We are seeing this happening in this month only. I understand. Third wave, it may be how much severe could be nobody got idea. Suppose it become more severe than second wave, then anything what you are saying may go kaput. In the situation. We I mean, vaccination is going on with $5,000,000 per day and may go to 8,000,000 to 10,000,000 in next month next month per day. And the vaccination and the errors zero service survey is showing that you are developing a herd immunity. We demand optimistic. We keep positive thoughts. The business conditions are going to be better. Got it, sir. So my second question is, you know, you mentioned about this. We understand that during COVID, there was a certain gap between the progression of this project. But any updates in terms of which states are have already rolled out Nulcigil, what is the kind of progress on this? No. All the states have become active. All the states have become active to install Nullcigil scheme. All are racing to see that the scheme can be completed. If not by 2024, definitely by 2025. All are moving very fast. Other skills. Got it, sir. Got it. And my last question is, could you help us understand what is your Google versus in terms of your overall sales? Because we understand that you said that construction demand is looking up quite well. So is construction mainly urban or rural slash semi urban for Demand is much better in tier four, tier three, tier two town also. Construction good in rural area also. Construction good now in house in other city metro cities also. Now construction, have our mind, most of the country. Got it. Money is available at lower cost, and the salary job also increased. EMI is manageable. So I think things are looking quite positive. So for our overall sales, what could be the rural versus urban mix? No idea. We have good distribution networks for the country. Got it, sir. That's it from my side. Thank you. Thank you. The next question is from the line of Achal Luhade from GM Financial. Please go ahead. Good evening, sir. Thank you for the opportunity. My first question is in terms of the market consolidation in the plastic pipe business, I just wanted to check your thoughts. Are we seeing most of that consolidation played out? Or given the issues the smaller guys faced in terms of getting a material or working capital or whatever, are we are we part of that consolidation, or there is, you you know, long way forward? We have not heard any merger taking place in plastic piping. We have not heard. Well, I was more asking from unorganized to organization, sir, from that sir. I thought we guys also get all to place with business. And we organize player player also will go on growing. They also role to place, so they will also they will also remain in business. We believe that. Right. But some of them, they replaced issues in last four, five quarters. So are you seeing they're coming back, or they are still lying low as of now? No. We don't keep track of unrealized sector. We know definitely the PC price have gone up too high. Our polymer price gone too high. Some of them are struggling for working capital, but we have not had any great pain. Understood. And secondly, you know, sir, with respect to the balls, what would be the market size? What is the opportunity here in terms of the aggregate industry level? Of which piping segment? The wall walls, what you have yeah. Wall to wall is a big market where more and more is metal wall only. Precisely, what is the size of plastic wall market, we have no clarity. Once we get clarity, we can share with you. For the metal market worldwide, maybe more than $60,000,000,000. Worldwide, our type of industrial valves market maybe $60,000,000,000. Matter. Understood. That's very helpful, sir. Thank you so much. Wish you all the way. Thank you. The next question is from the line of Rajesh Ravi from HDFC Securities. Please go ahead. Yeah. Hi, sir. Good evening. Sir, I have few questions. First, few housekeeping numbers, sort of. How was the average PVC pricing for you in first quarter and versus fourth quarter and the current pricing. And, similarly, if you could share some trend on the CPVC in, you know, q four, q '1, and q two, that would be helpful. Sorry to interrupt, mister Ravi. There's a disturbance coming from your line. Request you to mute your line while the management answers your question. Your line your voice mail also not clear. Please. Yeah. Am I audible now? Now for me, you are audible. Yeah. Okay, sir. Sir, I just wanted to get some sense on CPVC PVC prices in q one and in the preceding fourth quarter, and how is the scenario now? And also if you could throw some, you know, light on the CPVC pricing trend over last two, three quarters, including Q2. The PVC pricing was a peak in the fourth quarter of last year. And in this quarter, the PVC price has gone down by 19 rupee kilo. Now beginning second quarter, they've gone up by 2 rupee kilo. Okay. On an average level, how was the pricing change for you, sir, in fourth quarter versus q one? Overall, going down by 19 to be a kilo. So you can take your average maybe maybe around 12 rupees per kilo. Okay. That is what you saw in the okay. Average for three months. Average. Average. Yeah. Okay. And on the CPVC side, how has been the price volatility? CPVC prices remain quite high level. There's not much change. Okay. And not not moving up also? Oh, it is going up only. Nothing coming down. Okay. So how much is the prices increased in January or in q two as we stand? There are many suppliers. Every supplier got their own pricing. There are cheaper big suppliers in the world, and they got their own pricing. Mhmm. Okay. Every pricing, they have very classified information. Okay. Okay. No issues. And, Alma, you talked about the inventory loss. Hello? Yeah. Please. Yeah. Inventory loss, possible to quantify that we are booked in first quarter? Some some inventory loss, we must have incurred in the first quarter, but major inventory loss, we have carried forward for the second quarter. Okay. It keeps on the stock of pipe. Mhmm. Okay. So if prices don't go up, we are that will lead to an inventory loss booking in. Depends. Depends, yes. Yeah. Obviously. Okay. For the full year, we are not factoring much in about it. Okay. Okay. And, sir Sir, you may be volatile always. Okay. And, sir, you talked about the, you know, volume trend across plumbing and agri segments for you Y o Y. However, you know, if I have to look on a q on q basis, how would these numbers would have played out, the agri and plumbing both, you know, growth or decline versus fourth quarter? First quarter is not a yearly season. You can see only yearly season compared to last year this quarter. Okay. Okay. May, June are the peak month for every demand. Mhmm. Mhmm. And we told you, we your master our company lost 22,010 units around. Okay. Distraction in demand or architecture pipe system. Mhmm. Mhmm. Pipe system is more irregular pipes. Okay. And that would have largely played out in April and May. So June and July, things would have started to normalize for you. May partly June also. June, July, this is Early, but demand agriculture segment, it is running throughout the country. Mhmm. No. No. Overall in the CPVC and all, have the normal fees been achieved in month of July? CP is normally in June also. CP is nothing to do with the renegotiation. Mhmm. Okay. And, sir, on the CapEx that you have talked out, you know, $5.20 crore total, so what would be the year end capacities across various categories, you know, by FY '22 end? You see, our present capacity on March 21 were about 697,000 metric ton, comprising of 509,000 of plastic piping, which will increase to about 550,000 now after this CapEx of the current year Five fifty thousand. Okay. Yeah. The industrial product, it was 71,000 at the beginning. Uh-huh. It go up to 80,000 by end of the year. Okay. Packaging product, nothing much from 82,000 to 88,000 because we are not expanding packaging capacity assets except Okay. So we're calling capacity by 2,000 metric ton. And consumer from 31 to 33. That's 2,000. Expansion capacity will come in the piping and industry port. Okay. Okay. And anything specific in the in the consumer in the furniture segment and in the industrial segment, the sharp decline that we have seen in this quarter, if I'm looking on a q on q basis, which you see will more of a short term nature and things will recover. I'm asking this because in furniture, you have also been in your presentation, you have been mentioning that the industry is consolidating. The industry size is shrinking, and you have been getting market share. So how should we look at that segment? Though it is small for you, but because that's a large high margin business for you. Which one? It's a business. We had a growth last first quarter now. Okay. So I'm looking at q on q basis, the sharp decline. Sorry to interrupt, mister Ravi, but I would request you to rejoin the queue for follow-up questions, sir. Yeah. Sure. He is looking at quarter four and quarter one now. Our business is not sequential growth, mister. Not sequential growth also. We can compare quarter to quarter. Up here, last week, here during this year. We already compare business to our previous quarter. We are noted by bank and not an IT company. So very difficult to give us any sequential comparison. Thank you. Ladies and gentlemen, please limit your questions to two per participant. Should you have a follow-up question, would request you to rejoin the queue. The next question is from the line of Neha Talwaja from Edelweiss Securities. So just two questions from my end. Firstly, you mentioned that your exports have gone up by 50%. What is the percentage of exports in our total revenues, and is it only in the packaging division that we understand? It has gone up in in pipe division and packaging division and also in cylinder also. Packaging cylinder and pipe, all the three division, growth in the exports. And can you quantify the percentage of total sales in each of these divisions also Just to see how much are they exporting in each of the divisions. Like, each of them, I mean, so I do know other way you can say overall. I think we have grown 5 point half million. How much? Our overall is point. Sorry? Our overall is $5,900,000 for the quarter. Oh, sure. I'll calculate the other thing, sir. And, sir, my second question was related to the tank business. So so I think you have been doing reasonably well. Is it fair to assume that the business has reached a sizable size of I mean, if at all, you know, you can give a qualitative statement here that what would be the size of it, you know, beyond a hundred and 50 odd crores to store right now? Is it fair to assume that number? No. We can only say that we are going on intensifying our reach in tank business. When the two new plants are coming also, we'll be making tank. So we by end of the year, we'll be making tank at seven seven plants. So our our reach will make it very comfortable to our user. The freight rate will be lower, and customer can do business with a lower or lower stocking with them. Because this tank deposit, good storage area. And we need to store for them, and we'll be servicing them very efficiently from our own products. Sure. But any revenue or targets that you have for this particular division? The classified information. In class. Okay. Okay. Got that, sir. Thanks. Thanks, sir. I'll get back in the queue. Thank you. The next question is from the line of Utkarsh Nopani from Haitong. Please go ahead. Yeah. Hi. Good afternoon, sir. So the first question is, like, our total sales volume de grew by 16%, in April and May month, and it has further gone down by 31% in the June month over previous year. So just wanted to know from you, like, how is the demand scenario in the current July month over previous year? Is it much better now in the positive territory, or it has sell down? Anyway, there are ten more days to go for July. But up till now, our sales in July in volume also are better than last year, July. Okay. Talking only about tempting dates. Oh, sure, sir. Sir, second is, like, you have mentioned that all the states have become quite active on Nulcigel program. So just wanted to know, like, are you seeing good demand traction from Nulcigel program on the ground currently? And if yes, what would be the expected market opportunity to be created out of this program? And which pipe segment are expected to benefit? Is it UPVC, CPVC plumbing pipe, or SWR, HDPE pipe? It'll HDPE pipe, MTP pipe, PVC pipe, and fittings. All all will be benefited, and CPC pipe also. All benefited. Now the shares have become active, and it is going to come as the period goes. We can talk more and more number properly in the month of April next year, but we are seeing that demand will be generated now in most of the states on no schedule scheme. They are all getting active. Okay. Okay. In fact, very where I did a pipe up from made from various materials. And, sir, lastly, like you, sir, you have mentioned that the PVC resin prices started moving up and is expected to remain firm. So do you see any risk to the agri pipe demand, say, for second half of FY twenty two if resin prices remains high? Agri pipe, this is not a quarter now for Agri pipe. Agri pipe pre quarter is gone. Now July, August is any season. Agri pipe start dividing a little bit from September and partly in October. So Yes. Require pipe, they require pipe. But when the farmers were getting infected, they were not leaving their villages. There were no development about to place this year. Okay. Got it, sir. Thanks a lot, sir. Thank you. The next question is from the line of Priyant, individual investor. Please go ahead. Mr. Priyant, your line is unmuted. Please go ahead with your question. Yeah. Sorry. First of all, JC Ram, thanks for giving this opportunity. Yeah. Yeah. My my first question is that, in the balance sheet, age of thirty first March, we have case and case equivalent of $7.50 crore rupees. And, which is mainly invested, for example, you can say in the liquid, mutual fund. Seeing the current trend in the market, like, don't we feel that a certain portion of this, for say 50%, if we invest in the in the, like, blue chip company sales, which are performing good and, like, the good sector, the return can be maybe 40% per annum at least as compared to eight to 10%, which may be, like, earning from the liquid. And we have seen that many comp like like, if you have seen the certain companies in the market, they are investing the surplus in the in the good companies there. So what's the strategic initiative on this? We we don't invest in share market. Sorry? We don't invest in share of any company. All company are good. We don't invest. So so you are saying that we are happy with the, like, liquid mutual fund in the we are happy with this one. Yeah. Definitely happy. No. But, like, what I'm saying that even the government is promoting to put the 20% of their cost of in the in the fair market. So suppose if certain for certain percent of the investment, I think return will be more, which will be good for the all the shareholders, including you promoter also. We are not government. Okay. Okay. And my second question that is, we have seen this, this, the the new part of cylinder, this plastic cylinder for the last five, six years ago. And, so we would like to know that, for example, in this quarter, what has been the effective utilization of the capacity and what is your target utilization as we have mentioned in the press release that now IOC and BPCL, they're also floating tenders. What is your target lesson for this capacity in yeah. During q two sorry. Like, during FY q two? Well, the best part is that now the division has gone to EBITDA plus. No more EBITDA minus. And when the Indian consumer start using our cylinder, we are very confident they would like to switch over from metal cylinder to composite plastic cylinder. It not only protect them from any from any shortage in filling, it protect them from their life because the chip metal cylinder burst and people die. The polished cylinder burns out, doesn't burst. So it's protect the life also. So we are very confident. Our capacity today is between 450,000 to 500,000 per annum. We hope that very shortly, we should be able to sell quite substantial portion of the capacity. And and, sir, what is the current utilization? Or or in, like, '2 or in FY 2021, whatever the utilization? The first quarter, we sold around 8,000 number per month. Ah, okay. Now second quarter, we expect much much better, which is long way to go. Yeah. Yeah. Yeah. And, sir, like, next question on the CPVC. As we all know that the margin in CPVC is very good. So we would like to know that what was the our volume, what's the turnover of CPVC in 2021, and what's our targeted turnover for 2022? Because that in first quarter, we had a growth of 42%. No. But, sir, like, that was because of this, like, lower base. So so better to have a full year number. So what was the full year number for 2021, and then we can achieve this growth? Yes. We expect that we will grow up between 20 to 25%. Sir, what was the volume but but, sir, what was the volume for 2021? Volume is classified information. Okay. And then, sir, like, are we taking any are we taking any strategic initiative on this CPVC part? Like, for example, Lubrizol has come in the market, and they have signed some call blessing with some other other company? Sir Priyans, sir, this is the conference operator. I request you to rejoin the queue for follow-up questions. Okay. Okay. Okay. You. Thank you. The next question is from the line of Mohammed Mansal from Optimum Securities. Please go ahead. Hello? Hello. Hello. Sir, my question is regarding Supreme Petro. So if you could give a a brief overview of the product vertical wise performance and the trending in the polystyrene and styrene monomer prices and what are the spreads right now? And the second question would be, sir, on the CapEx. Are we confident we'll finish the CapEx of PS and EPS in quarter four FY 'twenty two, like, by end of this financial year. And, sir, in the AGM, you mentioned about the tie up for March ABS. So it's been two, three weeks. So are we expecting an announcement soon? We have three question in out of one question, but I can reply all of them. Let's first part of the CapEx. But your CapEx, plan around $2.64 rupees for Polish China and EP capacity expansion. We are confident that all will be in place first quarter twenty one, twenty two. All the verticals are doing well. The Polish land and EPIC demand were very weak in the first quarter dramatically. But fortunately, we had a good demand in export market. So Polish land capacity, we could run a fair drought, and we could export it. EPS capacity has to get blocked because EPS is not easy to export. And for mass ABS, our negotiations are going on very properly, and we hope that maybe before August, we will be able to make announcement. Okay. Thank you. Thank you. Thank you. The next question is from the line of Chirag Shah from ValueQuest. Please go ahead. Yes. Thank you for the opportunity. Sir, my question was on, first, on volume. So you mentioned that by the end of this year, you hope to achieve last year's volume at least. So this recovery will be led by more agri or piping. Where are you seeing the most traction? Now the recovery will be every segment. The demand restriction took place to place. After all, we share every part throughout the year, but July, August are very in month. But January, March are better month. So we we are very confident. Not only that we will achieve the last year number of total of 94,000 ton, but we expect our business to grow than total of 94,000 ton for the year. Got it. And, like, you we are making a player in housing segment. And housing segment, we we remain quite optimistic. Got it, sir. And, sir, second question was on inventory losses. So is there I mean, you mentioned that on a full year basis, you are not expecting major inventory loss. Is that statement correct? We we remain optimistic on that part because market conditions are very volatile on polymer pricing, and need to be our optimistic that we may not end up with any inventory loss. We're not optimistic. We can't be. Percent, I cannot. There will be some losses. Is that understanding correct? Because of higher cost inventory? We don't say we'll be in loss. We said we'll try to quit. But, definitely, last year, we gained 204 rupees. This year, there will no gain. As of today, it doesn't look like. We can't we can't sell. We are we are handling all completely polymers, and price is gone rising and going down many times. Polymer pressure by the local market are changed 17 to 20 time in a year. Right. So what was the price reduction taken by you in month of May and June? We reflect the reduction made by the local makers. And they told earlier, the PVC price went down by $19.50 kilo. Got it. Got it. Thank you, sir. All the best. Thank you. The next question is from the line of Kashyab Dhawiri from MK Investment Managers. Please go ahead. Mister Kashyam Saviri, line is unmuted. Please go ahead with your question. Hello? Hello? Yeah. Am I audible, sir? We are available, audible, please. Just one question, a clarification. When you say that CapEx has gone up from INR 400 crores to INR $5.25 crores, our annual report already mentioned about that Odisha CapEx. So what is the incremental CapEx, sir, in Odisha about? For Odisha? Yeah. You mentioned that, you know, 400 crore CapEx has gone up to $5.25 crores. You mean the 400? 1 20 1 crore rupee in Odisha in the first first phase. Additional $1.20 crores is because of acquiring of the adjacent plots that we were mentioning about? That is already there with us. Okay. Investment in building and On on that additional line. No. No. No. Additional line. No. No. Just Let's see. That 400 crore CapEx where we had spoken about Gattak, Odisha was only line cost. Yeah. 400 Odisha and Tamil Nadu project. Okay. Those are excluding those two projects, these are the 400 what we have committed already and we have planned. Okay. Now one by one, we are not taking up those project in hand. Now Odisha, have crystallized, and we are taking hand now. Okay. And therefore, we have to complete. After product sharing this project. Sure. Got this. Got this, sir. Thank you. Thank you. Yeah. Yeah. Thank you. The next question is from the line of Ripul Shah from Sumangal Investment. Please go ahead. Hi, sir. My question was how what is the price differential between metal cylinders and composite cylinder? So if you can Compose cylinder price are expensive than metal cylinder. Can you comment by how much in percentage terms? We usually didn't check. But they are two different If they are pricier, then our marketing companies may not go for it. No? Because it will be costly for consumers. It doesn't cost them. You can you will pay more deposit because it's it's more safe for them, and they are given full quantity if you buy a complete cylinder. Okay, sir. So are are we planning any major CapEx in this area, sir? Which which CapEx? Which area? Composite cylinder. First, we will sell out the capacity. Okay. It is around 5 lakh you said, no, per annum? For the 50,000 to 500,000 pieces, which we are staying with there for the last seven six seven years. Let us sell the capacity, then we have good enough land. We are we got enough potential to increase the capacity. And we will plan to increase the capacity, but the market is going in a full way. And, yes, by huge quantity of cylinders. Our very small quantity. Okay, sir. Thank you, and all the best. Thank you. Thank you. The next question is from the line of Shailesh Raja from B and K Securities. Please go ahead. Yeah. Thanks for the opportunity, sir. Sir, my question is pertaining to Supreme Petro. Sir, we are creating PSEPS capacity of 1.2 lakh tons and also 60,000 tons of ABS. So in your view, how long it will take to fill this capacity, and what is the incremental revenue you are targeting from this new capacity? No. The revenue will will relate to the price of. So when people got the revenue, but we believe that in Polish time capacity, partly, we'll sell in domestic and partly, we will export. And the EPS capacity, we are expanding very small. We are only 30,000 ton. We should be able to load the plant very quickly. Okay. Sir, we can fill it in two, three years, sir? I think we should do sell everything by twenty to twenty three. Okay. Okay. So is it fair to assume a blended sustainable EBITDA of 20 rupees per kg for this PSEPS and ABS product? And with 600 crores CapEx, what is the payback you are targeting, sir? $1,600 crore rupee. We took 260 crore rupees only. Including ABS? ABS, up till now, the technology tie up is not for them, so we have not enough the investment. Okay. Okay. Okay, Sir, now Supreme is closer to a billion dollar company. Can you please host a separate investor call or some press release? That would be very helpful, sir. And also, sir, can you please share quarterly product wise volumes in one q f a twenty two and four q f a 21? That's all. Petrol? Yeah. Petrol, sir. Yeah. We will share the revised the supreme petrol people. Okay. Okay, sir. Yeah. There are questions. Thank you, sir. Yeah. Thank you, sir. Thank you. Ladies and gentlemen, due to the time constraint, this was the last question for today. I would now like to hand the conference over to the management for closing comments. We thank you. We we thank very much to other participants for their very intelligent question. We hope you satisfied them. We we thank them for taking great interest in the working of our both the companies. Thank we thank all of them very much. I said my colleagues is and. We all thank them all very much, and we wish them very safe and healthy journey going forward. Thank you. On behalf of DAM Capital Advisors Limited, that concludes this conference. Thank you for joining us, and you may now disconnect your lines.