Ladies and gentlemen, good day, and welcome to the Ion Exchange (India) Limited Q3 FY 2023 Earnings Conference 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. I now hand the conference over to Mr. Anuj Sonpal from Valorium Advisors. Thank you, and over to you, sir. Thank you. Good afternoon, everyone, and a very warm welcome to you all. My name is Anuj Sonpal from Valorium Advisors. We represent the investor relations of Ion Exchange (India) Limited. On behalf of the company, I would like to thank you all for participating in the company's earnings call for the third quarter and nine-month ended of financial year 2023. Before we begin, let me mention a short cautionary statement. Some of the statements made in today's earnings call may be forward-looking in nature. Such forward-looking statements are subject to risks and uncertainties, which could cause actual results to differ from those anticipated. Such statements are based on management's beliefs as well as assumptions made by and information currently available to management. Audiences are cautioned not to place any undue reliance on these forward-looking statements in making any investment decisions. The purpose of today's earnings call is purely to educate and bring awareness about the company's fundamental business and financial quarter under review. Let me now introduce you to the management participating with us in today's earnings call and hand it over to them for opening remarks. We have with us Mr. Ankur Patni, Executive Director; Mr. Vasant Naik, Group Chief Financial Officer; Mr. N.M. Ranadive, Group Head of Financial Planning and Risk Management; and Mr. Milind Puranik, Company Secretary. Without any further delay, I request Mr. Vasant Naik to start with his opening remarks. Thank you, and over to you, sir. Thank you, Anuj. Good afternoon, everybody. It is a pleasure to welcome you to the earnings conference call for the third quarter and nine months ended of the financial year 2023. For the third quarter under review on a consolidated basis, the company reported operating income of INR 5,121 million, an increase of around 32% year-on-year and 14% QoQ. EBITDA reported was INR 625 million, an increase of 46% year-on-year and 17% QoQ. EBITDA margin stood at 12.2%, and net profit after tax was INR 477 million, an increase of around percent year-on-year and 23% quarter-on-quarter, while the PAT margin improved to 9.31%. For nine months of financial year 2023 on a consolidated basis, the operating income stood at INR 13,421 million, an increase of 24% year-on-year. The EBITDA stood at INR 1,486 million, an increase of around 26% year-on-year, and the EBITDA margin was reported at 11.07%. Profit after tax stood at INR 1,138 million, an increase of 45% on a year-on-year basis, and the PAT margin percentage improved to 8.48%. Let me now take you through the quarterly segmented performance on a consolidated basis. In the engineering division, the revenue for the quarter was INR 3,263 million, an increase of around 51% year-on-year. The EBIT for this segment was INR 310 million, an increase of 174% year-on-year. The company witnessed steady order flow both in the domestic and international markets. While the execution of the Sri Lanka order remains significantly affected, the company has discussions for expediting the project closure, and the discussions are continuing on an acceptable way forward. On the other hand, execution of the Uttar Pradesh Jal Nigam project is progressing satisfactorily, and revenue has been recognized based on work completion. Also, execution of the other engineering orders picked up pace during the quarter, and we expect the trend to continue on the back of the increased order flow and backlog. The order book as of 31st December 2022 stood at approximately INR 1,637 crores. This excludes the Sri Lanka and the Uttar Pradesh Jal Nigam and the recent IOCL order, which we had announced on 2nd August. If we add to the order book of INR 1,637 crores, our total order book would be approximately INR 2,923 crores. We also have a bid pipeline of INR 8,400 crores. With this, we have a strong visibility for the next two to three years from the engineering segment, and we are well-placed to undertake significant increase pace of execution in the ensuing quarters. Moving to the chemical division, the revenue for the quarter was INR 1,515 million, which increased to around 3% year-on-year. The EBIT was INR 378 million, an increase by 23% on a year-on-year basis. The sales in the domestic segment continued to record steady growth, while the export volume remained muted. This segment witnessed improved margins aided by stability in the input costs. Lastly, in the consumer division, the revenue for the quarter was INR 457 million, an increase of around 30% year-on-year. The loss for the quarter was INR 15 million. This segment continues to record steady top-line growth. Just a small correction, the order book after adding the IOCL orders, the Uttar Pradesh Jal Nigam, and the Sri Lanka order will be around INR 3,648 crores. With this, we can now open the floor for the question and answer session. 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 the touch-tone telephone. If you wish to withdraw 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. Reminder to the participants, anyone who wishes to ask a question may press star and one. Ladies and gentlemen, in order to ensure that the management is able to address questions from all participants on the conference, please limit your questions to two per participant. Should you have a follow-up question, we would request you to rejoin the question queue. First question is from the line of Chetan from Emkay Asset Managers. Please go ahead. Yeah. Thank you, sir, for the opportunity, and congratulations for the good set of numbers. Sir, wanted to ask on the engineering front, okay, what has been the execution on account of the UP project for the quarter, and that will be at what margins? The UP execution for this quarter was around INR 46 crores. As regards the margin, as we have mentioned in the earlier concall, we don't get into the specifics of the contract level margins. Okay. The capital employed in the engineering division has increased by close to INR 130 crores quarter-on-quarter. That will be towards what thing? Primarily, it is we have to take care of the execution in the fourth quarter. There has been a slight buildup in the inventory levels. Also because of the higher turnover, the debtors levels have also increased. Okay. The UP execution, the last quarter, I think so it was close to INR 76 crores. This quarter the billing has been lesser. Yeah. Is it right to summarize? No, last quarter was around INR 48 crore and cumulative for the 9 months it is INR 121 crores. By when the traction in the execution will start happening? Because the order book is quite high, and we have to execute it in a span of 2 months, and lesser than 2 years. From which quarter the execution will start ramping it up? You're talking specifically of the UP order? Yeah, UP. Yeah. Yeah, we expect the traction to pick up from the fourth quarter onwards. Okay. Thank you. Can you elaborate how the Sri Lankan project right now, we are not doing any work. How this thing will be getting unfolded in the coming time, or it will be a status quo? How much money is yet to be received from the Sri Lankan project? The pace of execution on the Sri Lankan order has almost come to a standstill. While there are continuing discussions between the Indian government, the Sri Lankan government, as well as Exim Bank and IMF, the other agencies involved in restructuring of the debt of that country. We remain in touch with all concerned agencies. We can only say that we are getting positive overtones from these discussions. As of now, till the situation reaches a conclusion which is acceptable to all these agencies, the fund flow to the Sri Lankan projects will remain extremely constrained, and hence our projects execution also would be going at a very, very slow pace. Okay. On the engineering margin front, the last quarter of FY 2022, we had posted 19% margin because of the strong revenue growth. In the nine months so far, our EBIT margins on the engineering front is close to 6.7%. Are we on track to achieve that 10% guidance, what you had said as a full year? We still believe that we will reach close to the double-digit figure for the full year. Okay. Thanks for that. Next on the chemical front, can you update on the greenfield update, the thing, how it is getting progress? Because we are waiting for the EC thing. That was the first thing. The second thing is the margins in the chemical division has been quite good. The sustainability on that. Yeah, the two questions from my end. Thank you. We are still awaiting the environmental clearance for our project. There is no movement on that front, unfortunately. As it stands, we remain expectant that it can happen anytime. Once it starts, as we had indicated earlier, it will take roughly about a year and a half for the plant to get commissioned. We are looking at around maybe the last quarter of 2024, 2025. Okay. On the margins front? We've seen improvement in the margins, this has happened because of the stability in input prices. Hopefully, the stability as well as lack of disruption in supply chains would get sustained. If that happens- Our feeling is that for the full year, we should be able to maintain the current levels or improve it further. For the full year FY 2023, which is growth 24 basis point margin, what you did for the quarter? Yes. For the full year, we should be able to get to a margin which is similar to what we have achieved now. Okay. Maybe improve it a little bit. Okay. In the next year also, we would like to do that number. Yes, this margin is quite sustainable, barring some unforeseen movements in raw material prices or some other unprecedented events. Per se, it is quite sustainable. Okay. Thank you. That's it from my end. Thank you. Thank you. The next question is from the line of Prashant Sharma from Quantum Securities. Please go ahead. Yeah. Thank you for the opportunity. Sir, my question is regarding the new order that we got for IOCL. When we can see the execution of that order starting? The execution of that order would start very, very soon. The contract is for completing the execution in a 24-month period. Okay. As of now, since we've just received the order, in the next couple of weeks, the action on that contract will start in earnest. Okay. My second question is regarding the chemical sector. I think our growth has somewhat stalled because if you look at the year-over-year growth is at 3%, and quarter-on-quarter, actually is a decline by 5%. What's the challenges that we are facing and what's the future growth projection in the chemical segment? Chemical segment is doing quite well on the domestic front. As such, we are seeing good growth numbers and as you would be seeing, the margins are also doing well. On the international front, however, since two of our important markets are the North American markets as well as Europe. Those two markets continue to be slightly constrained, and we remain hopeful that it will recover soon enough. Once that happens, the growth should happen on both sides, which is domestic and international. My last question is, sir, regarding the consumer product. Our revenue has increased by 30%. On a margin there is a decline of almost 200, 300 basis points. What's the reason for the decline in EBIT margin? Overall, the consumer segment is doing well on the uptake of the new products. We are getting good traction as we have been disclosing on the previous calls. We expect that the top-line growths will remain quite good. As far as the margins and EBIT levels are concerned, we are now investing a little bit more to ensure growth in coming quarters. Some of the expenditures which have been made in the current quarter are oriented to improve the top line as well as overall operations of the company in the coming period. That accounts for a slight dip which you are seeing. Overall, we are quite happy with the prospects of the segment. Thank you, Mr. Sharma. May we request that you return to the question queue for follow-up questions. Thank you. We'll take the next question from the line of Akshat Mehta from Samiksha Capital. Please go ahead. Am I audible? Yes, sir. Hi. Thank you for the opportunity. My first question is regarding these advances that you've received over the last six years. Because obviously working capital is negative, and I believe five years back you said that these were mainly pertaining to Sri Lanka project. I just want to understand if these advances also relate to some other project and what is the sustainability of those advances now going forward. Vasant, can you comment on that question? All engineering EPC contracts typically will have a certain percentage as advance and as the engineering order book increases or sustains at the current level, the advances will keep on coming in. It's not only related to a specific Sri Lanka order, but all other large EPC orders or even the medium-size orders, always has a certain percentage as a mobilization advance. Okay. Do you have some kind of a run rate that you can share that going forward, let's say your INR 3,000 crore is your order book right now. What will be the kind of advances that we'll receive? What will the percentage may be? Typically, for engineering contracts, the advance is in the region of around 10%. 10% of the total contract value, yes. That's it. Okay. Secondly, I just want to understand that in quarter three, we've seen a sharp dip in your gross margins on a year-on-year and quarter-on-quarter basis. What are your drivers for that dip in gross margin? Can you please repeat that question? Are you talking of a cost gross margin? Yeah, we are talking about gross margin. In quarter three, your gross margin have come down to around 37%. There's been a decline year-on-year as well as quarter-on-quarter in gross margin. What is the key driver of that? As the share of the engineering segment increases, typically that has a higher cost structure compared to a chemical segment, where the cost structure is more towards the operational expenses. While in the engineering segment, it's more towards the COGS side. As the share of the engineering segment increases, there will be some deviation in the overall cost structure as a gross margin. Okay. That is not on account of some cost lag effect that we're not able to pass on, correct? No. That is purely on account of change in mix. If you see there for the quarter, the engineering segment contributed around 61%. Yes. It's almost 5%-6% more than what was there in the earlier quarter. Okay. Another thing that I wanted to understand is, are any of the projects currently that are there in the order book multilaterally funded? Other than the Sri Lanka project, which is funded by Export-Import Bank of India, there are no other projects. No other projects are multilaterally funded. Yeah. Okay. Mr. Mehta, does that answer your question? Thank you. We'll take the next question from the line of Pratik Kothari from Unique Portfolio Managers. Please go ahead. Hi. Good afternoon. Congratulations for a very strong execution and also the beginning of this process of consolidating our holding on Satluj G. My first question on the engineering, I believe the IOCL orders which we won, the INR 350 crore and the subsequent INR 750 crore. I believe this is the first time that we have won a ZLD order for a refinery. If you can just throw some more light of what is driving this, what the opportunity can be regarding the refinery orders. Thank you for the compliments, Pratik. Yes, certainly this is a momentous order for us, but not the first ZLD. We have executed quite a few ZLDs in the past. This certainly is one of the largest in the industrial segment, and we look forward to more opportunities from the refinery and other segments in India. As you would know that there is quite a bit of a push on the front of environment management by oil companies, and especially the larger PSUs have been quite proactive on this front. The investments are coming not only with respect to new capacities or expansions. The investments are also coming to ensure that the technologies are upgraded on the older plants. A lot of downfield investments in ZLD and WFS technologies. The prospects look very good. Thank you. Sir, any color on how much of the refining capacity that we have has already been covered under ZLD? I mean, the opportunity size available. I would not be able to give you an exact number on that, Pratik, right now, but certainly our team can get that to you at a later date. Sure. Sir, my second question on chemical. Like you highlighted due to some reason, at least in the near term, we are seeing subdued volume of sales. But given our stated ambition of doubling the capacity in the first phase and then taking it to three years, can you just maybe qualitatively highlight what are those signals that you're receiving from our customers in Europe and North America? What is giving us this optimism that after a long time, we are going on such an ambitious CapEx, at least on the chemical side? I'll say the growth momentum which we had on international chemical sales was quite good till we hit a sort of a stumbling block on account of COVID because of the ongoing war in the eastern part of Europe. We do believe that the kind of acceptance that our products have got in that market, continued positive feedbacks from the distribution chain as well as from the final customers, indeed our own appreciation of the specific requirements in the different markets and of different customers. All these are coming together in a very nice way, I am more than sure that It will translate into much bigger numbers in the coming years. Unfortunately, as we have been saying over the last couple of quarters, that the situation in Europe has not been favorable for a very fast increase in the revenues coming from that market. Having said that, our expectations remain that in the coming quarters, the growth momentum in both North America and Europe will pick up, that would provide a very good fillip to our aspirations. Okay. This is We had guided for some 30%-35% growth for FY 2023. This is at a consolidated level, right? That's right. Okay. Last quarter would be very strong again. Great. Okay. Thank you, sir, and all the best. Thank you. Thank you. The next question is from the line of Sandeep Dikshit from RGF Partners. Please go ahead. Thank you. We just wanted to understand on the Sri Lankan exposure. Do we need to make any provisions or have you made any provision? Sir, Randhir, can you briefly comment on that? Sir, repeat the question, please. On the Sri Lankan project, do we need to make any provisions for if there are any debts or anything. Is there any provision required for the Sri Lankan project? Right now, we do not anticipate that eventuality of making the provision, every quarter we take our exposure. As you're aware of it, we have not been involved in the progress of the job is much standstill only. Only our retention money is lying with the bankers. We just watch about. There is no debtors out there on the Sri Lankan project? No, right now there's no need to make a provision. Thank you. That answers my question. Thank you. The next question is from the line of Ruchita Kadge from iWealth Management. Please go ahead. Hello. A very good afternoon, sir. My question was on the chemical front. At the current capacity that you have, what is the revenue potential in it? First, I would like to know about that, if you could. Hello? At current capacity levels, given that we are continuously upgrading our product mix towards more value addition, and also that we are in a continuous process of modular expansion of capacities and for specific product lines. We can expect that from the current levels, we would be able to deliver almost 50% kind of a growth based on current capacities only. This is for the chemical segment as a whole. Okay, sir. On the consumer business, I wanted to know that the production of these purifiers, are you outsourcing it or are you making it in-house? The purifiers, we have a vendor who provides us on an exclusive basis based on the inputs that we give to them. This is for the smaller equipments. The larger equipments are all in-house. Okay, sir. How is their distribution done? The distribution, we have multiple channels that we use for it, which includes direct sales channel. We also go through distributors and also tap on the retail chains. Okay. Sir, that 60% growth that you said in the chemical side of it, that is sufficient for the kind of growth that you are expecting till this greenfield capacity comes in? Yes, roughly around 50% is what I indicated to you based on the current capacities. We are also, as I mentioned, continuously in the mode of upgrading our facilities where required to fine-tune our product mix towards more value addition. We were certainly hoping that the clearance for our expansion, resin expansion project would have come in earlier. As of now, it seems that at least for the next year, we should be reasonably okay in terms of our both plants. Okay. Understood. Thank you, Ms. Kadge. May we request that you return to the question queue for follow-up questions. We will take the next question from the line of Saket Kapoor from Kapoor & Company. Please go ahead. Namaskar, sir, thank you for the opportunity. Couple of questions, sir. Firstly, on the bid pipeline, you did mention about INR 8,000 crore is the bid pipeline. If you could give us some color on the success ratio. What percentage should we presume in on a bid pipeline of 8,000? As we've been saying, maintaining over the past few quarters, typical success rate on the bid pipeline is around 20%. Okay. What should be the timelines for these bids? This is on a rolling basis, I think so. This is on a rolling basis. The smaller projects in the pipeline, they tend to close much faster. They could be between 3 to 6 months. The larger projects would typically take between 6 to 18 months. Sir, just on a ballpark number and on a very conservative basis, what kind of order book built up we can expect on a quarterly run rate? Just to take into account the optimistic scenario in the bid pipeline. On a conservative basis, what should be the figure we can work our numbers would be in order intake, confirmed order intake? See, on an overall basis, we can make assumptions based on our current offer bank. Further to that, there are a few opportunities which would come within the quarter and close within it also. They not necessarily get reflected in the quarterly disclosures of the offer bank. Right. We are witnessing an uptick in terms of the order conversions that we have been getting in the current year. As you would probably have noticed, the current year's order intake would place us in a position to declare for the full year one of the highest order intakes which we have had, if we exclude the extraordinary order of Sri Lanka. If one takes that out of the equation, then probably this year would end up being one of the best in terms of order intake. I would expect this trend towards improving order books to continue into the next year and thereafter. Hence, to give a run rate based on the past would probably not be the best way to look at it. Further to that, sometimes a large order conversion happens in one big lump. INR 700-800 crore orders, as we just declared, that would create a big surge in a particular quarter, and did not really follow the average run rate that we've been speaking about. We can work on maybe for at least multi-year projections from this engineering segment. It is not a one or two years business that we are currently looking into. We can very well look into the visibility even going ahead, depending upon current business scenario. Absolutely. The current order book itself is looking at, we should be expecting this to get executed over a period of two to three years. As we keep converting the opportunity pipeline, my guess would be we should be looking at further improvements in the order book as we go forward. We are getting good response, both from the domestic market as well as from the international markets. If you factor both of these in, this is not a short-term phenomenon. It is certainly something which the global market opportunities offer to us over at least a five to seven-year period. I don't see that those opportunities are going to dampen. Right. Traditionally, we have always observed that ex two and especially quarter four, the execution cycle, there is a good ramp up. Also, I think in the first quarter, if I'm not wrong, you did articulate the fact that you're building up the teams in order to improve the pace of execution. Going by the numbers of last year percentage of revenue booked under the engineering, there is a very likelihood that we can look forward for even a stronger execution cycle for the coming fourth quarter also, as has been the case historically. We can take a reasonable expectation there. Secondly, the fourth quarter will see much higher levels of execution than we've seen till now. Thank you. Mr. Kapoor, may we request that you return to the question queue for follow-up questions. We'll take the next question from the line of Sunil Kothari from Unique PMS. Please go ahead. Thanks for the opportunity, sir, and my hearty congratulations for such a good number and consolidation we have started in such a way. Sir, my question is on I understand you won't be able to disclose or maybe analyze fully the opportunity of this JLLB and PHU water opportunity. What I understand is how this is the first time IOC has started with this size of project, this type of ZLD and so many technical involved water-related cleaning projects. India across has many refineries. All the power plants also use so much water. If you can just try to analyze, may not be in a revenue or other possibilities, but say size of refineries, number of plants, number of power plants. Those will be also, I think, supposed to be converted in slowly ZLD, because government is the only agency which can trigger this activity. Otherwise, private sector will not follow this. Your thought process will be really helpful. Thank you for the question, Mr. Ajay. Yes, we are seeing the PSUs. IOC in itself is a very large organization, and we are just talking about one refinery here. They are in the process of looking at any and every opportunity where they can go greener. We expect others, apart from IOC also, to be doing expenditures on environment technologies at a faster pace. Certainly, PSUs as a whole, driven by the central government policies, have been one of the more proactive entities on this front. Having said that, it is not that the private sector is really lagging. Lot of the large entities, when we look across India, have been taking very progressive steps to ensure that their respective entities comply with the highest level or highest standards in terms of environmental compliances, and even way beyond that. We are certainly standing at a threshold where the country as a whole will witness significant strides towards a much greener and a much more responsible industrial attitude towards the environment. I am hopeful that this IOC order is just one beginning to substantially improve flow from similar organizations in the future. Sorry to interrupt you, Mr. Kothari. There was some audio loss. Please repeat your question. I just wanted to check how well-prepared are we in terms of manpower or engineering capabilities. Are we doing enough? The opportunity seems to be very large, what preparation are we doing? If you can share whatever possible. Yes, we continue to invest in people and systems and in other resources to ensure that we are geared up to take on the upcoming opportunities. This is a continuous process. There is a degree of flexibility which one can have in executing these projects. It's not that you have to have all the people in your organization in advance. You get an opportunity to expand the workforce for contract-specific executions. As far as the infrastructure goes, we have been working on it to get ourselves geared for much larger scale of operations than we are currently in. I can confidently say that with the capabilities that we have added over the last couple of years, we are geared to take in a much higher level of execution than what we are currently doing. We are in a continuous process of augmenting them further. Thank you. Mr. Kothari, may we request that you return to the question queue for follow-up questions. The next question is from the line of Tushar Raga Tati from Kamaya Kia Wealth Management. Please go ahead. Yeah. Good afternoon, sir. Congratulations on your good set of numbers. My question is on the engineering division. Now we are getting some larger ticket size contracts. I just want to understand the guidance which you gave for the current year. Will that be maintained only to the range of 20%-30% going forward, looking at the current scenario, the order book which you are seeing? Yes, for the year as a whole, we are maintaining the guidance of a 30% growth in the top line. No, my question is for the next financial year. Considering the big pipeline, are we confident enough to maintain that growth guidance? For the next financial year, I'm not giving out a guidance as yet. Directionally, I can say that the order book that we have needs to get executed over a period of 2 to 3 years. That itself would indicate the next couple of years has to be quite strong. We will be adding more orders to this and I am quite hopeful that the next couple of years also will be quite good. Fair enough, sir. My second question is on the execution of UP project. Sir, in the percentage terms, the execution it seems to be very less. Is it fair to assume that the execution will be in the H2 of the contract? Like any big contract you take from here to 2 to 3 years, is it fair to assume that the larger execution will happen in the H2 of that respective contract? Yes. The invoicing for the contract tends to be a little bit skewed towards the later part, because in the initial few weeks or months, there's a lot of pre-engineering, designing, and mobilization and those kind of things which happen. Ultimately, the invoicing would happen when things start moving on the ground. That takes a little bit of a time. There is a bulge which would come somewhere in the middle, thereafter, as the contract moves towards closure, the invoicing will again become lesser. Instead of saying that it is rear-ended, I would rather say it is a little bit more towards the center of the contract. Thank you, Mr. Agam Shah. May we request that you return to the question queue for follow-up questions. The next question is from the line of Mahesh Agrawal, an individual investor. Please go ahead. Hi, am I audible? Yes, sir, you're audible. Hi, Aankur and team. Congrats on another consistent quarter. First thing just wanted to understand was around the Portugal subsidy. Is that a European company that we have acquired, or is it something we are setting up ourselves? What is the scope of the business we are looking at there? Is that for an EPC kind of business or something in the chemical space? The European subsidiary that we have reported is a subsidiary which we have set up. That subsidiary would be looking at all businesses. Currently, the major focus would be towards the chemical segment. Having said that, we are actively looking at acquisitions in the European and in other markets, including India. We are in relatively advanced stages of discussions on some of these. Once those happen, they will add to our overall kitchen and reach to these respective markets. Got it. These would be manufacturing opportunities that we would be setting up or acquiring? Like actual manufacturing on the ground in Europe? This would aid our manufacturing abilities in the continent also once we reach that stage of maturity. Understood. Got it. Thanks. Then the next one was, again, on the wastewater industrial treatment side. You already spoke a bit about the opportunity and kind of the change you're seeing in the mindset from companies to adopt these practices. Just wanted to double-click a bit more on that. Has there been a drastic shift in the government laws and enforcement from the environmental ministry to actually start enforcing this? That was one, is to understand, is there actually a drastic change in the laws which will kind of push this? Or is it more just being driven by promoters becoming more ESG friendly themselves and sort of the PSU in case of like IOCL setting the benchmark there for private sector to follow? It's a mix of everything. There is certainly much more awareness today amongst the industry captains about what they should be doing for the environment. A lot of it is being driven through the commentary by the various industry bodies and associations, as also on an international front, being driven by the various announcements through agencies like the COP26 or the COP28 that we are talking about. That certainly aids a lot to push initiatives on this front. As far as the government regulations more or the keenness with which the authorities have been trying to enforce these regulations, the regulations have been quite tight for quite some time. As we increase in maturity of implementing these regulations, our infrastructure to monitor and control the various parameters associated with these implementations, that ability has gone up. As we go further, the intent of government would help, certainly, but the overall ability of the administration to measure, monitor, and control the implementation would keep going up. The incentive for the industries to not comply will keep going down because more and more the investors and the consumers are also asking for environmentally friendly products and processes. It's a whole which is impacting it, not just one or two of these things. Thank you. Mr. Agrawal, may we request that you return to the question queue for follow-up questions. The next question is from the line of Agam Shah from An Individual Investor. Please go ahead. The current participant has placed the line on hold. We'll move on to the next question from the line of Akshat Mehta from Samiksha Capital. Please go ahead. Hello. Mr. Mehta, please proceed with your question. Yes. I just want to understand one thing that you have all these large projects that are coming in. Can you share some details on what would be the average revenue of your smaller projects on a quarterly or a yearly basis? What kind of revenue that would be? For the small projects on a yearly basis, Randhir, would you be able to give a broad kind of a number? On a yearly basis, I think we are looking at somewhere around an engineering revenue of roughly INR 400 crore to INR 500 crore. Some of these contracts tend to be as short as about a month or 2 months, and on the higher side, these contracts could be around 6 and 12 months. We move at a fast pace and we're not necessarily visible in our quarterly disclosures. Randhir, please correct the number if that's off. No, what I explained is right. These keep on coming, and the turnaround time is from 1 month to 2 months for the smaller jobs, and small to medium, this will be at about 6 months time. Okay. Again, I just want to understand, even the chemical segment side, your margin improved a lot in FY 2021, from around 15% to 20%-24%. What was the key driver of that sharp improvement in margin in FY 2021? Going back to 2021 is a long stretch, as you would have noticed. In spite of a couple of bad years in between, the recovery of the margins back to the levels of yesteryears has been quite good. My belief is that we will be able to sustain these numbers going forward. I'll give a broad response to the kind of improvement that we have seen from around 15%-16% levels to 20%+ level. One of the things which has contributed is, of course, that we've improved operational efficiency and operational throughput. The second has been the improvements in the product mix that we've been having. Certainly made rapid improvements on controlling our costs on various fronts and improving our efficiencies in our various plants. A lot of factors have gone into make sure that the profits are at a higher tag. Certainly, stable input prices have helped to maintain these margins without linkages happening because of supply chain issues. Thank you. Mr. Mehta, may we request that you return to the question queue for follow-up questions. The next question is from the line of Jainish Shah, an individual investor. Please go ahead. A couple of questions on Shah, sorry to interrupt you. The audio is unclear from your line. Please use the hands-free. Is it clear? Yes, sir. Please proceed. I have a couple of questions, especially one on the international opportunity that you spoke about. We have seen last number of large-size projects which we have won largely from the domestic market. However, you always alluded that there are opportunities which you are pursuing in the international market. If you can just update what kind of situation out there, given that the economies are going through an uncertain periods, and how are we placing? Second question is, as you just mentioned that you are looking at acquisition opportunities. Could we just get some sense about which are the areas which you are trying to plug, and what kind of a budget which we have assigned for that acquisitions or for the acquisition purposes? Thank you. The international market opportunities, there isn't really much to report on an update. Yes, we have been pursuing some large opportunities, and these are in the infrastructural segment of various countries. The target geographies being Middle East and Southeast Asia and as well as Africa. The current economic scenario and the scenario which has prevailed for the last couple of years has not been the most productive as far as these opportunities go. As we have been maintaining in the past, there is slow progress on almost all of these. It's very uncertain to really make a mark as to when exactly this would culminate into an order. We remain hopeful, but would prefer not to lead onto a period or a forecast for the next few quarters. Once it happens, certainly we will come out and make a disclosure. Sorry, sir. Just to add up to this. These big pipelines generally do contain this kind of opportunities, or is it without that? No, the big pipelines do not affect these opportunities. Okay. Thank you. Sorry. Go ahead, sir. You have put a question on the acquisitions. We are not looking at very large acquisitions. We want small acquisitions in the sub INR 10 million. That's why I'm saying small acquisitions. The target being better reach into various geographies that we are looking at, maybe some technology-related improvements also, and creating a manufacturing/marketing base in the geographies that we intend to make acquisitions. Okay. Thank you, sir. Thanks. That's it from my side. Thank you. The next question is from the line of Ramaswamy from IR Investments. Please go ahead. Namaskaram, Mr. Patni and the management. Heartiest congratulations for the excellent set of numbers. My question is that India is becoming a semiconductor hub. Any improved visibility are you finding from the semiconductor sector? Because purified water is one of the components there. If you would kindly elaborate on it. Thank you very much, sir. Well, we're looking at various opportunities emerging from the semiconductor and related industries in India. We are actively working on it and hope that the industry would give us good numbers in the coming quarters. If I may ask, currently, do we supply to any semiconductor industry? Anything executed there? Yes. There are contracts in the semiconductor sector. Okay, sir. Thank you very much. Thank you. Ladies and gentlemen, due to time constraint, we will take that as the last question. I now hand the conference over to Mr. N.M. Ranadive from Ion Exchange (India) Limited for closing comments. Thank you, and over to you, sir. Good evening. Thank you all for participating in this earnings call. I hope we have been able to answer your questions satisfactorily. If you have any further questions or would like to know more about the company, please reach out to our investor relations manager at Valorem Advisors. Thank you. Thank you. Ladies and gentlemen, on behalf of Ion Exchange (India) Limited, that concludes this conference. Thank you for joining us. You may now disconnect your lines.