Ladies and gentlemen, good day and welcome to the Q3 FY 2025 Earnings Conference Call of Amara Raja Energy & Mobility Limited, hosted by Motilal Oswal Financial Services Limited. As a reminder, all participant lines will be in the listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing the star, then zero, or a touch-tone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Aniket Mhatre from Motilal Oswal Financial Services Limited. Thank you, and over to you, sir. Thank you, Steve. Good evening, everyone. Welcome to the post-earnings conference call of Amara Raja. At the outset, I would like to thank the management team of Amara Raja for giving us an opportunity to host this call. From the management team, we have with us Mr. Y. Delli Babu, Chief Financial Officer of the company. I would now like to hand over the call to Mr. Delli Babu for his opening comments on the company's Q3 performance, after which we'll begin the Q&A session. Over to you, sir. A very good afternoon to everyone who is on the call. Thank you for your interest and time. During the current quarter ending on 31st December 2024, the consolidated revenue for the business is about INR 3,272 crores, with a growth of about 7.5% over the previous year, with the lead-acid battery contributing about 96% of the revenues and the rest coming from the new energy business, both from the battery packs and chargers. See, the lead-acid battery business has witnessed a revenue growth of about 9% over the previous year on the back of a strong volume growth from both automotive as well as industrial segments, barring the telecom segment, where due to changing to the lithium chemistry, the lead-acid volumes have come down compared to the previous year. The four-wheeler volume growth for the quarter in the aftermarket side is about 11%, and the OEM growth in the four-wheeler segment was muted during the current quarter compared to the last year's numbers. The export volumes registered a growth of about 8%- 9% during the quarter. There are some headwinds, which I'm sure by the year-end we'll again pick up a double-digit growth in the export volumes. The two-wheelers, both in the aftermarket as well as OEM segments, have grown around 15%- 17% kind of a growth, continuing the aftermarket growth momentum in two-wheelers even in this quarter. In the other applications, both tubular batteries and the home UPS systems have grown by about 15% in volumes compared to the previous year, and the lubes business that we have started in the last financial year has also gained some good traction. In the current quarter, the overall revenue is about INR 100 crores from the lubes distribution business. On the industrial segment, both the UPS and the exports have grown significantly, but the overall volume growth is muted because of the dip in the telecom segment. In the new energy business, because of some changes in the OEM uptake, there is a reduction in the overall revenue compared to the previous year by about 20%, but I'm sure with the localization plans for the chargers getting completed, we are expecting that we will be able to recover this loss through the financial year. In terms of the overall trading revenue from the business, on a standalone basis, this quarter, the trading business accounts for about 10% of the total revenue. When we look at the gross margins, there is a dilution on account of majorly two factors. One is, there is a bit of an increase in some of the alloy metals like tin and antimony, and also there is a power cost that we had to provide for in this quarter because there is a fuel purchase cost adjustment that has been done by the AP government for the financial year 2023-2024, so that revision of the power cost has to be provided for in the financials in this quarter, so that's kind of impacted the operating margins close to about 1%-1.2%, and in line with this higher cost that has been levied, we may have to create some more provision for the current financial year in the Q4 of this financial year, which may have impact around 0.4%-0.5% of operating margin. Going forward, with the increased renewable portion in our overall power procurement, we expect to reduce this impact in the upcoming financial years. On the other updates, we have received on the tubular plant that we are reinstating after the fire accident. We received a cumulative insurance claim of about INR 275 crores so far, which is more than the book value what has been recognized towards this plant in the books, which is where you would have seen an exceptional gain of about INR 111 crores in the financial year. This plant is expected to commence its operations by the beginning of next financial year. On the recycling plant in this quarter, we have commenced the first phase of commercial operations of the refining capacity of 50,000 tons. We have started the commercial operations in the current quarter, and it will continue to operate at a full capacity for the next quarter as well. And then we are expecting to start the smelting operations, that is, the battery breaking operations, sometime towards the end of Q1 of next financial year. And you have also noticed another comprehensive income negative, about INR 132 crores in the financials. That's more because of the fair value reassessment of some of the investments that we made into some startups. We have done the fair value reassessment, which is why that loss is seen over there. We are seeing the volume momentum continuing in the domestic aftermarket, and also our uptake to some of the export markets continues to be robust. So with the lead-acid battery business posting reasonable growth over the next quarter as well. In the new energy business, we have just commenced our first tranche of commercial deliveries of the two-wheeler packs, as well as we have completed the localization of portable chargers for two-wheeler and three-wheeler applications. We are moving ahead with our first Giga factory work. We expect that the first Giga factory on the NMC side might commence its operations, as mentioned earlier, either towards the end of next calendar year or beginning of 2027. With those brief overview, I would now request if you have any specific questions, we can take them up. 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 handset while asking your question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Mumuksh Mandlesha from Anand Rathi Institutional Equities. Please go ahead. Yeah, thank you, sir, for the opportunity. Starting with the other expenses, as you mentioned about the electricity cost going up, about 100 bps- 120 bps impact for this quarter. But I still see the other expenses also being higher by around 170 bps Q-on-Q. Can you just explain what other expenses had seen increase this quarter also? See, the total QoQ expenses increase is about INR 51 crores. Out of that, about INR 37 crores is power. The rest of the expenditure are some of the advertising expenditure that we have incurred during the current quarter, which generally on an annualized basis will kind of the expenditure are incurred based on the activities that we perform in a given quarter. And also some bit of increase in our overall freight expenditure, considering some of the additional trading business that we have done during the current quarter. Beyond that, there are no other significant increases. Got it. And just for next quarter, another 40 to 50 bps of impact would be seen for the more electricity provision, right, sir? Yeah, I'm expecting it could be around 0.4% is what is my estimate at this time, but obviously we need to fine-tune that estimate. That's the current estimate that I have. Next year onward, from the current level, it should come down, the quarterly revenue. It should come down because this is more coming on the back of higher procurement costs that the government has taken up. It should come down both on account of grid power coming back to its normalcy as well as we increasing some more third-party power procurement, both from the renewable side as well as some of the procurement from the power exchange side. So I'm sure this number should again go down. Got it. Sir, coming to telecom segment, can you share what was the revenue share for this quarter? And considering the shift happening to lithium battery, I mean, any near-term, what kind of fall we expect for this segment? The current quarter revenue is still about 10%-11% of the total revenue. But if I look at from the because in the telecom side, when I look at including my lithium-ion battery packs that we are supplying, still it accounts for about 10%-11% of our overall revenue. But only on the lead-acid side, if you take because these are still initial days in terms of our overall lithium supply. So around 9% of the revenue from telecom of the overall revenue is from the telecom lead-acid battery business. I think we will see a conversion of lithium into telecom going forward as well. But this being one of the oldest plants that we have, so it is not a huge drain as far as the profitability is concerned. Currently, how much is the fall, sir, in the telecom, sir? On a year-on-year basis, about 25%- 24%. Got it. Got it. Sir, on the lithium cell plant, just on the once it commences operation in CY 2027, based on the ramp-up plans and the orders which we have won, what kind of revenue we expect, sir? See, on the pack side, on the lithium, both packs and chargers, last year we clocked a revenue of about INR 500-odd crores. And this year also, we expect to meet that number, maybe 10% higher than what the number last year was. So that's the number that we are looking at. But going forward in the next year with the new chargers that are getting localized and also some of the DC fast chargers products that are getting ready and ramping up some of our battery packs to other product segments, both in the storage side as well as mobility side, we should see some bit of growth. But at this time, it is too early for me to put a number around how much it could be. I mean, it should be sizable enough, but at least in my mind, it should at least be in the double digits. But I wouldn't be able to put a number right now for the next year's growth. Got it. No, I was basically asking for the cell plant, sir, the NMC cell plant in the first year operation, what kind of revenue we see, sir? See, the current price levels of NMC cell is around $70-$75 per kWh. So our phase I capacity out of the 2 GWh, maybe initially we will start with half of that 1 GWh kind of a number. So it also depends on the offtake. So I mean, you can. That's the kind of initial revenue what we can expect depending on how the demand ramp-up happens. Thereafter, we have to see how it goes. Got it. If possible, any kind of order number would you have, or any key customer win, sir, in recent times, sir, in the cell side? Apart from the earlier announcements, what we made for 21,700 cells with a couple of one of the OEMs that we have entered into an agreement, there are discussions with other OEMs because these cells predominantly go into two-wheeler and three-wheeler applications, so there we are in touch with a lot of OEMs that are interested about the uptake, but I don't think I'm in a position to give you specifics around it. Got it, sir. Thank you so much for the opportunity. That's all from my side. Thank you. Before we take the next question, we would like to remind participants that you may press star and one to ask a question. The next question is from the line of Vibhav Zutshi from JP Morgan. Please go ahead. Yes, thanks for the opportunity and congratulations on the strong volume growth. Just coming back on the lithium-ion side, can you just provide some updated timelines of the next plant that is stated to come with Gotion, where you have highlighted that 4-6 GWh could be potentially possible? Because it looks like even the first phase is seeing a bit of a delay because earlier we were planning to commence commercial supplies in FY 2027, and now it looks like we come up with the 1 GWh by early CY 2027. So yeah, just some updated timelines on the NMC as well as the LFP plant with Gotion would be helpful. Yeah, I think on NMC, first phase also, I think we earlier mentioned towards the end of calendar year 2026, which is what is getting maybe there could be a delay of a quarter here and there. As far as LFP is concerned, as I mentioned earlier as well, it will take at least another three to four quarters after the NMC plant commencement because there will be preparation exercises that are currently going on, indicate that it may take that much time considering various gestation periods for capital equipment and also some of the software development that is required. Got it. And just as a follow-up to this, I mean, the question is that you mentioned that there are some headwinds in the sector. So I mean, what exactly are these headwinds? Is it like the lower cell pricing or overcapacity from China? So what exactly are these headwinds that we're talking about? See, I think all these conditions around the over-supply and the pricing pressure, volatility in the raw material, these are all points that I mean, they are definitely there. And as we mentioned in earlier calls as well, that any investment in this will go in a calibrated manner because with high capital intensity, we can't be taking that penalty. So in that way, as I mentioned earlier also, we don't mind delaying a bit, but ensuring that the capital that we put in is getting used as early as possible. So in that sense, we will time the CapEx in a manner that it is not becoming financially burdensome. And it is not that the timelines, whatever we are targeting today, I'm not saying they are not subject to change. We should be changing them given the financial interest and also the way the product offtake has to happen. Because even the product requirements for various OEMs might undergo a change. According to that, we have to make amends to our own preparation and our own product mix to what we have agreed. So those things keep undergoing a change. I don't think there is not a business that everybody has understood every bit of it. This, I think we have discussed multiple times in these calls. Yeah, that's fair. My second question is on the lead-acid battery business. So just to understand correctly the impact of the higher electricity cost, so if your normal margin level, say, is, say, 14%, 14.5%, then there could be an impact of 40- 50 basis points in the next quarter. Is that understanding correct? Yes. Yes. Yes. Okay. Next quarter also, mind you, next quarter also has this headwind in terms of the currency depreciation because this also impacts the overall lead prices. We have to see how this goes considering both the metal, the lead staying around the 1,900, but the currency depleting to almost INR 87.5-88. What kind of impact it will have towards the end of next quarter is something to be seen. That's definitely another factor that is coming up. I'm sure we'll find ways and means to mitigate it through some actions. Yeah. Got it. Thanks. That's very helpful. Thanks. I'll come back with you. Participants who wish to ask a question may press star and one. The next question is from the line of Kapil Singh from Nomura. Please go ahead. Good afternoon, sir. Hi, Kapil. Hi, sir. So on the telecom segment, just wanted to understand if one is to take into account the overall revenue opportunity, including lithium-ion as well as lead-acid, is the market growing or it's not growing? I mean, any assessment there? You are asking in terms of margins? No, no. The industry revenue is it growing if you take both the lead-acid and the lithium-ion put together? Is the demand growing in the industry? The part size is not because, see, the lithium procurement prices are marginally higher than the lead-acid by about close to 10%-15%. So in that sense, the overall potential of the telecom segment as such is not undergoing any significant change, either upwards or downwards. Okay. Sir, but what I was trying to understand is, is there demand? What kind of demand growth are you expecting if you put together both lithium-ion and lead-acid? From overall revenue perspective, it may be completely muted considering that the new tower expansion as such is not growing in such large numbers. Whatever comes is going to be a replacement demand. And lithium will have a longer replacement cycle as compared to lead-acid. So I don't see much of a growth rate coming up in the telecom segment as such in the immediate future. Understood. And sir, is there any plan to sort of repurpose these capacities or to use them in future? Because the way things are moving, it looks like over a longer term, at least the telecom segment may not need lead-acid batteries, right? So how are you thinking about using these capacities? See, this capacity is, as I said, this is the first factory that was put in by Amara Raja about 20, 25 years ago. So from that point of view, the current capacity utilization around 65%-70% is actually not taxing on the overall profitability margins as such. But yes, we will see if there are other opportunities where we can use that machinery. But generally, being LVRLA batteries, beyond telecom, there are very few applications where those batteries are used. We are also looking to see if there are any export opportunities for that particular product. But we will see if there is other product segments that we should think about and then repurpose those machines. But as such, they being very old machines, maybe we are better off going for a newer and advanced machinery than repurposing them because the overall net block that I am carrying on that factory will not be more than INR 50 crores. Okay. Okay. Understood. And on the pricing of the batteries, can you give an update? Because the currency has been depreciating, as you said. How much cost pressure are you observing right now? And is there any pricing change we have done in the last few months? No, we have not taken up any price change as of now. But I'm sure we will have to see which way the lead moves from here. That's an important aspect for us to consider. And moreover, there is a lag that will be there for about maybe a month, month and a half before the high-cost lead hits us. And also, some of the lead that we are procuring through the internal for the compliance of BWMR rules, what the scrap that we are procuring, the domestic scrap procurement is also steadily increasing. So we have to look at this mix. And then if there is a permanent increase in the raw material cost, then we have to deal with it appropriately. And as you know, anyway, we have these pass-through rules with the B2B business. But aftermarket is something we need to take that decision at an appropriate time. Sure, sir. And just last question, I wanted to check for NMC facility that is coming up for the cells. What is the EBITDA break-even level of production that we need to do to sort of break-even? See, as I mentioned earlier, NMC plant per se at the 2 GWh level will not deliver when we said that the entire lithium capacity has to mature to a level of at least 7-8 GWh kind of a number for it to really deliver targeted EBITDA margins in the lower double digits. But at the initial level for this plant, at least until we stabilize on the throughput and process scrap, etc., it will have some bit of pressure at least for two to three years. Only then we will see that some positive margins coming up. But this is a long game. I don't think I can give a number around what EBITDA margin that I will immediately hit on the day one of the factory commencing its operation. Yeah, sure. So I was actually not looking for EBITDA margin, but the production capacity utilization at which you achieve EBITDA break-even? See, utilization level generally in this segment, they deliver the optimum margins if we are able to achieve around 85% or so. But that will definitely depend on two variables. One is the demand. The other is obviously the plant ramp-up as well. Sure, sir. Thank you. And I'll come back in a few. The next question is from the line of Mukesh Saraf from Avendus Spark. Please go ahead. Sir, good evening and thank you for the opportunity. First question is on pricing. Kind of some of our techs suggested that competition is hiking prices by up to 3% in the aftermarket this month itself. So would Amara Raja kind of be following suit there on the price hikes? Mukesh, you know I can't give a pricing decision over an investor call. But nevertheless, as I mentioned earlier, we will definitely review those prices and then see what decision to be taken in the aftermarket in the light of the dollar appreciation. Right. But directionally, the call will be to kind of preserve margins over any kind of market share or any such target there. See, I don't think we are going to dilute the margins for any higher market share as such, Mukesh. I think that direction is clear for us. Sure. Sure. Got that. And I think most of my other questions are answered. But if you could just give an update on CapEx, how much we have done and what could be the next year's CapEx? See, this year, including the tubular restatement, which is taking close to about INR 400 crores. In addition to that, as I mentioned earlier, we may have to spend another INR 300-INR 350 odd crores. So the total CapEx for the current year could be around, if I leave the tubular numbers aside, we may touch about INR 400 crores in the overall CapEx outflow and maybe another INR 100 odd crores, INR 100-INR 200 crores on the, sorry, INR 200-INR 300 crores on the new energy business. So that's the CapEx outflow. Next year, we should see at least about on the lead-acid side, I need another INR 300-INR 400 crores of CapEx. And in the new energy side, I may need about another INR 500-INR 600 crores. So next year, may see a INR 1,000 crore kind of an outflow. Got it, sir. All right. So thank you. I'll get back with you. A reminder to all participants that you may press star and one to ask a question. The next question is from the line of Balkrishan from ExxonMobil Investment Management. Please go ahead. Good evening, sir. My first question is related to lead-acid business. How are you anticipating the demand in terms of volume as well as total revenue perspective in the next financial year? See, as we have discussed earlier, both the four-wheeler segment, we have always seen the overall market demand around 8%-9% kind of a growth and two-wheeler demand growing around 11%-12%, or in some quarters, it has even gone to 12%-13% as well. And we will see the UPS segment in the industrial side still growing at 6%-7% kind of a number. But export market is where we believe we can grow at least another 13%-14% kind of a number next year as well. So given all this volume backdrop and also the traction what we are seeing on our lubes business, I think we should continue with a revenue momentum of anything around 11%-12% even going forward on the lead-acid battery side. The second question is related to overall at the industry level in the lithium-ion business. So we recently saw a report on the players who bid in PLI scheme. It appears that they will not be able to get any incentive because they would not be able to meet the targets of localization or production level. So do you think will this be, or let's say, that will put us at the par level, or how does it impact the industry players who did not get to participate in PLI schemes, and will it make any difference in the competitive landscape? See, I think PLI scheme obviously had certain conditions with respect to starting commencement of the commercial operations. So when we quoted, we are being realistic to when we can actually do this. But nevertheless, that's going to be an advantage even as for the scheme for a period of about three to four years where our estimate was we could get the best of the subsidy, then it may make about $3-$4 per kWh of sales. So to that extent, for a period of three to four years, maybe people would have enjoyed that benefit. But even without PLI or with PLI, the overall strategy of getting into this battery segment was intact. I don't think it is materially going to alter the decision-making of any player who is really interested to come into this segment. So from that sense, in a long-term perspective, I don't think that will make a very serious difference to the competitive landscape. Yes, maybe there could be some players who may think otherwise. But I believe if you look at large players who have commenced a long-term commitment to this business, I don't think it will undergo a significant change. Thank you so much for answering my questions. Thank you. The next question is from the line of Aniket Mhatre from Motilal Oswal. Please go ahead. Hello, sir. Switching around your market share trends on a segmental basis, could you just tell us where we are? Are we losing share? How are you placed within the competition? No, I think we are stable with respect to our market share. In fact, on the aftermarket side, we believe we must be gaining some bit of market share considering last two quarters growth momentum what we are seeing on the four-wheeler as well as two-wheeler side. But that kind of estimate we generally revise on a yearly basis. But we believe currently we should be around 33%, 34% kind of a market share in the aftermarket side. Maybe in the two-wheeler, we may be a little higher, maybe around 35%, 36%. And as far as the industrial is concerned, we continue to have on a combined basis, both lithium and lead put together, we should be having about 57%, 58% kind of a market share in the telecom. And the UPS business, we continue to be around 42%, 43% kind of a market share. On the OEM side in two-wheeler, we are around 25%, maybe marginally higher this quarter. On the other applications, which is the inverter batteries, I think considering the fact that we don't have the manufacturing facility today, we still command about 10%-11% of the overall market share in the inverter batteries. Sure. And sorry, did you mention about telecom? Yeah, I did. Both lithium and lead combined, we are at about 57%- 58%. Okay. So that trend, I mean, that trend continues. I mean, we have not shared even in telecom segment basically. Yeah. But considering the fact that we have so many players that are coming up in lithium and then currently most of all of us are backup on the, with cell capacity to be coming in, maybe we will see some bit of a dilution in the telecom market share merely because there are too many number of players currently operating. Right, and in terms of utilization levels at the moment, the two-wheelers, four-wheelers, and industrial, could you just help us understand where they stand today and if you would need any capacity in any of these segments in four weeks? See, we are almost using about 85%-90% of our four-wheeler capacity and about close to 90% of our two-wheeler capacity. And only in the LVRLA, our capacity utilization will be around 65%-70%, whereas the MVRLA, that is the industrial UPS batteries, we should be around 85% or so. Thanks to some of the throughput enhancement initiatives that our teams have taken up, we are able to realize more throughput out of the existing lines, which was one of the objectives that we have set for ourselves, how to get more out of the existing lines through some of the automation as well as industrial engineering initiatives. I think they are paying us well. I think in some of the units, we are able to increase the throughput considerably, almost to 5%-6% of the existing capacities we are able to add without making much of a capital investment. So I think as of now, we are self-sufficient with respect to the capacities that we need for both all the product segments that we are participating. Once we have the tubular facility coming up with close to 1.2-1.3 lakh battery capacity, that should be sufficient for our inverter battery demand as well because we always top it up with some bit of trading. Sure. As far as the CapEx for INR 300 crores-INR 400 crores by 2026, is that maintenance CapEx or that includes some capacity addition for some of these segments? Yeah. There are a couple of lines that we are taking up in our four-wheeler side. It will have some bit of CapEx requirement on that side. And the rest is basically the regular CapEx and also some of the automation-related CapEx in terms of automating some of our activities in the lead-acid factories area. We may need to put some more investment around the digitalization of it. So that's where the rest of the amount is going to be spent. Got it. Just one last bit from my end just to clarify on the lithium-ion part. You indicated the NMC line will start closer to CY 2026 or early CY 2027, which would mean by FY 2027, we'll start NMC. And it is likely to take, say, at least a year or so to ramp up, and then you would start the LFP, right? So by the time LFP starts, possibly we should look at FY 2029 or something around that timeline? At this point of time, we believe there could be, if commercialization is done on X date of NMC, it may take X plus 9-12 months from the date of commercialization. We should have the commercialization of LFP as well, that is what our current working assumption is, but if there is any change, I will let you know in due course. Okay, so by FY 2028, we should commercialize LFP anyway choice. Yeah. You can take 12 months difference between NMC and LFP commercialization. Fair enough. Thank you, sir. Thanks for the clarification. And all the best. That's all from my side. The next question is from the line of Joseph George from IIFL. Please go ahead. Thank you, sir. I have two questions. One is in relation to the tubular batteries that you are selling now. The plant will come online only in the first quarter of FY 2026. What is the revenue that you are generating now which will get converted into own manufacturing once the plant comes online? Once we start converting, it should result in a revenue on an annualized basis about INR 1,100 crores-INR 1,200 crores. Okay. So right now, the run rate that you're hitting is about, say, INR 1,100 crores, INR 1,200 crores, which is low margin because you're not manufacturing it yourself. But next year, hopefully, you'll hit that run rate with a higher margin because you'll be manufacturing it yourself. Is that right? See, because of lack of manufacturing capacity, we will not be able to give the entire revenue because trading obviously will limit the entire opportunity that we can do. So it will be a little lower trading revenue that we will be looking at this year. But it will increase by at least another 20% once we start our own manufacturing. But because we are starting this production in the Q1 of next year's season, we may not be able to participate fully with our manufacturing volumes. So once we commence the operations, the season thereafter, I think we should be in a position to meet all the required demand. Understood, sir. So the second question that I had was in relation to the lithium-ion business. So you mentioned that once you start the NMC operations, it will take two or three years for operations to completely stabilize and start thinking about maybe a bit of break even, etc. So when I think of the total investment that is going into, say, NMC, is it right to assume that you will have the initial CapEx that goes in in setting up the plant and machinery and all of that? And in addition to that, for a period of the first two or three years, till you are a bit positive, you will have to continue funding the cash losses. So effectively, the total investment till you reach break even might be much higher than the initial CapEx. See, simultaneous to the cell venture, the new energy business is also pursuing the pack business, right? So if we are able to meet the revenue expenses what we incur at least partially through the money what is earned by the pack business, we should be able to mitigate some of those cash losses at least at the entire new energy business level. But if they are beyond that, yes, they need to be funded. But at this point of time, our target is to see that that is as minimum as possible. But you are right. Because at the 1 or 2 GW level, I believe we will still be able to make up that number with the other businesses what we will be doing. When it ramps up to a larger scale, then I'm sure there will be a pain at least for a couple of years before the entire thing gets stabilized. Understood, sir. Thank you. Thank you. The next question is from the line of Sanket from Ashika Stock Broking Limited. Please go ahead. Thank you for the opportunity, sir. So my question is on AGM batteries. So recently, there was an announcement where it will start supplying AGM batteries to Hyundai Motor India. So are you getting any orders from other OEMs as well? And my second question is, what is the price difference between the AGM batteries and the conventional CMF batteries? And what is your view on AGM batteries? Is there a possibility that these batteries will be getting replaced by the conventional CMF batteries as well? See, AGM batteries, as far as other OEMs are concerned, I think while there are some OEMs have shown interest, and then some of them are trying to look at the possibility of conversion. But that will take some more time before it is fully done. From the realization point of view, yes, AGM batteries will give a higher realization, but I don't want to put a number now because we should look at that number only when it ramps up to a significant number. Only then I think it is right for me to discuss those numbers in the calls. But over a period of time, whether migration will fully happen from flooded to AGM, there are possibilities, but it is going to take some more time because it has happened in two-wheelers, flooded to AGM conversion that has started, and then it happened in a big way, which was basically driven by Amara Raja at that time. But I'm sure it will take some more time before all OEMs accept, and then we also offer the product to the aftermarket side of it. Sure, sir. I know, sir. So we may know what are the exact reasons why the OEMs are not shifting to these AGM batteries because the pros are better than the existing technologies? I don't think there is any resistance as such to migrate, but I'm sure they will have to make their own homologation before they give the final consent to the entire process. But I'm saying it may take some more time before I can tell you that all the OEMs, which are the major OEMs, who have agreed to go with this product because it also depends on their own vehicle requirements as well, right? So it is not that every product can be a simple replacement of flooded to AGM. There are other things that have to be taken care of before that migration happens. Okay, sir. So if I'm not wrong, we are the only one which is currently manufacturing AGM batteries in India. Is it? I may have to come back to you on that because I really don't know for sure whether XID is making it or not. I may have to check and come back to you. Okay, so my last question is, so we are expected to supply these AGM batteries in Q4 onwards, so what is the expected additional revenue from this segment particularly? No, it's basically in the OEMs, whatever vehicles that were going with the flooded, when they do the conversion, they will get replaced with the AGM. So from an incremental revenue point of view or volume point of view, I don't think there is a significant number that is going to come in. So once the migration happens, then I can tell you how much of flooded is moving to AGM. But I don't think there is going to be a significant incremental volume that I can comment on. Okay, sir. Lastly, what is the capacity of the plant which is manufacturing these batteries? We currently have, I mean, because these capacities are fungible with some bit of minor changes, we currently have about 2 million capacity to make these AGM batteries. Okay. Thank you, sir. That's all from my side. The next question is from the line of Mumuksh Mandlesha from Anand Rathi Institutional Equities. Please go ahead. Yeah. Thank you, sir, for giving the opportunity again. Sir, just coming back to the levy, sir. I just want to understand what was the levy for this quarter. And I mean, last quarter was INR 15 crore, and there was a INR 37 crore increase this quarter, right, sir? So INR 52 crore would be the levy, right, for the Q3 quarter? Yes. Yes. Yes. Out of which, sir, how much would be for any previous period, sir? Yeah. I said, see, current quarter, about INR 35 crores-INR 37 crores is all belonging to previous year. And additional amount, about another approximately, it should be about INR 14 odd crores for the next quarter. Okay. So currently, this quarter, INR 52 crore was the levy, out of which INR 30 crore, INR 35 crore is of the previous periods. So the incremental is that INR 17 crore, INR 18 crore is for the normal run rate, which is something will continue going ahead, right, sir? Yeah. See, that number cannot be set for the future period because it's a post-facto revision that every state government does. In some years, it is material. In some years, it was not material. So it all depends on the challenges of the power sector of that particular state government. I don't think I can say this is the run rate with which the levy is going to continue. That's not possible. Okay. But by Q4, sir, all the previous year levies would be completed, right, sir? Yeah. Yes. Yes. Yes. Got it. Got it, Got it, sir. And sir, lastly, you announced this quarter increased investment in the ARCS and the ARPS. Can you just help us? What is this increase for, sir? Yes. The ARCSPL is our recycling battery venture where we have invested about INR 500 crore so far for the phase I, which is what has just started the commercial production. And then we have said that we have taken the approval of the board for inclusion of additional INR 200 crore for the next phase. But the actual inclusion will depend on the project progress. And as far as Amara Raja Power Systems is concerned, that is the entity which is into charger manufacturing business where we have taken an unsecured loan approval for about INR 50 crore, which we will increase depending on the fund requirement. That is not an equity investment that we are proposing at this point of time. Understood, sir. Thank you so much for this. Thank you. Ladies and gentlemen, that was the last question for today's conference call. I now hand the conference over to Mr. Aniket Mhatre for his closing comments. Thank you, Steve. On behalf of Motilal Oswal Security Services, I would like to thank Mr. Delli Babu for taking the time for the call. Thank you very much, sir. Thank you to all the participants for attending the call. Thank you and have a great week ahead. Thank you. Thanks. Thank you, everyone. On behalf of Motilal Oswal Financial Services Limited, that concludes this conference. Thank you for joining us, and you may now disconnect your lines.