Ladies and gentlemen, good day and welcome to the CEAT Q3 FY2025 conference call hosted by Equirus Securities Private 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 star then zero on your touch-tone phone. I now hand the conference over to Mr. Mihir Vora from Equirus. Thank you, and over to you, Mr. Mihir. Yeah, thank you, Ruthuja. So good afternoon, everyone. On behalf of Equirus Securities, I welcome you all to the Q3 FY2026 Post-Results Conference Call of CEAT Limited. From the management side, we have with us Mr. Arnab Banerjee, MD and CEO, and Mr. Kumar Subbiah, CFO. So without further ado, I now hand over the call to the management for the opening remarks. Over to you, sir. Good afternoon, everybody, and happy new year to you and all your near and dear ones. Welcome to CEAT Q3 2026 Earnings Call. I will be taking you through the business updates for the quarter, and then I shall hand over to Kumar for his remarks on financial performance, post which we will take all the questions. The Indian car market delivered an upbeat finish to the calendar year 2025, supported by GST revision, which has improved affordability and overall consumer sentiment. Reforms have also led to broader participation across urban as well as rural markets, both for OEMs as well as aftermarket for tires. Overall, we believe that supportive tax policies, increasing EV adoption, and ongoing premiumization trends are likely to position the tire industry for a healthy single-digit growth through FY2031 next five years. Overall demand outlook: the outlook for the auto sector continues to be supportive. Macro tailwinds like RBI reducing repo rate in December is positive. Robust Rabi sowing and completion of Kharif harvest has also supported disposable cash flows and rural demand. Additionally, OEM price hike expectations have helped maintain near-term purchase activity. In the near term, we expect replacement demand for MHCVs to be mid to high single-digit. Any further upside could come from the annual seasonality during the summer months. For two-wheeler, demand has been consistently encouraging, and growth could be high single-digit. In OEM, MHCV is showing signs of recovery post-GST rationalization. Growth has been robust in Q3, high double-digit. LCV growth is expected to be similar. Increase in e-commerce and Q-Commerce activity would result in better sales of three-wheelers. In passenger segment, near-term growth is expected to be in double digit, with strong revival aided by consumer preference towards smaller vehicles, easing financing access. Growth rates in two-wheeler are strong and expected to be in double digit. However, we have to wait for a couple of quarters to see how the impact of GST will pan out. In international business, demand for radial series of highway tire and PCUV is strong, where India is emerging as an alternate and credible sourcing base for these tires on back of improved brand credibility with global OEMs and replacement distributors. CEAT performance Q3 FY2026: We had a good Q3 where we grew 20% plus YoY on a standalone basis. The standalone EBITDA stood at INR 557 crores. Volume performance: Growth momentum continued during the quarter over last year, 20.9% volume growth. Replacement segment has grown in about mid-teens for us, where demand came in strongly post-GST rationalization in September. In OEM, we had a base effect. Our last year base was not very high, so OEM has grown well as well, and international business has grown in the 20s% because of channel access improving in several geographies. In replacement, passenger segment grew well, very strongly. Two-wheeler continues to do well over the quarters, and with support coming from both urban and rural clusters, and grew in high teens%. OEM volumes grew strongly, YoY basis across segment. In PCUV, we had a low base effect, so growth was optically very high in OEMs. In two-wheeler, we continue to have a good share of business, growing in high single-digit%. Farm growth in OEM was also strong, where there was a demand revival, and growth was very strong, double digits%. Truck and bus radials also saw a very strong double-digit% growth. In international business, we saw growth across segments: passenger car tires and two- and three-wheelers, as well as in farm. In the U.S., tariff headwinds persisted, preventing us from growing faster. We have been making steady improvements across all segments and categories. In replacement market, our share of business was positive across truck-bus radial, across motorcycle, and there was some marginal drop in share in scooter and in passenger, which is much less than 1%. In OEMs, our share grew across passenger truck. In international business, share of exports grew across all categories. Coming to margins, our Q3 standalone gross margin witnessed a contraction of about 109 basis points QOQ. This was primarily driven by increased input cost from appreciated USD. We expect commodity prices to be benign and maybe a mild increase in Q4, which gives us an opportunity to achieve a consistent margin profile over time. Our standalone EBITDA stood at 14.1%, s tandalone net profit was INR 191.6 crore, which accounted for the effect of provisioning related to compliance with new Labour Codes. Coming to Camso, the business transition is progressing smoothly, with key sales hiring completed and planned operations running steadily. On the sales front, the CEAT team is currently taking over direct customer relationships from Michelin. The majority of existing customers have approved the business transfer, ensuring uninterrupted continuity of operation. A further ramp-up of operation for the current 50% utilization is expected to take another few quarters post adequate changes in the marketing mix. Camso P&L has experienced some one-time transition cost, which will not recur quarter four onwards. Operating profit was in double digits, as per expectations, after absorption of all operating costs. It will take three-to-five quarters more to control the entire value chain at the purchasing end and the sales end and exit transition. Margin profiles will keep improving, and volume traction shall increase also. Commenting on the other future trends: electrification, international business premiumization, and digital and AI. During Q3 on electrification, CEAT consolidated its leadership with 30% plus share in OEM PCUV EV segment, and it maintained the two-wheeler EV share at about 20%. We continue to invest in products in these two categories, and we continue to get approvals for new OEM vehicles. International, despite uncertainty surrounding the US trade agreement and pricing pressure from Asian competitors, particularly in European markets, CEAT specialty business delivered its strongest performance to date in Q3 FY2026, growing strongly in mid-20s, and year-to-date growth also has been high teens. During Q3, we introduced 32 plus new off-highway tire SKUs, and we continue to expand our product portfolio to serve as a one-stop shop for our customers. In non-specialty, we clocked high 20s growth on YoY basis in the overall non-specialty business, with strong growth coming up in passenger segment as well as in truck-bus radial. Europe has been a strong geography for us, along with Latin and Africa. Coming to Sri Lankan operations, market challenges persisted in Q3 as Cyclone Dana affected operations, and local competition further intensified, particularly in two-wheeler and PCR categories. Focus is here to hold on to our already high market shares in all categories and maintain our market leadership. Overall salience of international business was about 19.4%, and if we consider the Camso turnover, which is actually consumed in international markets, this figure technically works out to 23%. Premiumization, we continuously are building upon our cutting-edge technologies in premium categories. OEM approvals in high-volume premium vehicles are building the foundation for future replacement demand. We are investing significantly to ramp up the mix of larger rim-sized tires, and we continue to see gains in market share for our premium car tires across both replacement and OEM segments. Our two-wheeler premium portfolio, comprising of motorcycle steel radials and fabric radial, as well as motorcycle tires for 250cc plus bikes, continues to see traction and increase in market share. Digital and AI: at CEAT, we are committed to becoming an AI-led organization. To achieve this, we are planning to embark on a centralized data lake initiative that brings all enterprise data into one place, providing a solid foundation for AI-driven use cases across the value chain. Additionally, we are preparing to migrate to SAP RISE, which will enable next-generation AI capabilities and help achieve cost efficiency while unlocking advanced analytics and automation. To amplify this transformation, we are automating our entire budgeting process using AI/ML. During Q3, organic traffic to our website increased 12%, while premium tire sales through leads grew 64% over the same period. Positive sentiments for the brand moved up by 36%, with 24% increase in average interactions per post YoY. U.S. tariffs: as we speak, auto component duty on India continues to be 25%. So, on-road tires, TBR, and PCR fall under this category. For off-highway tires, total duty continues to be 50%. Sri Lanka is currently facing a 20% tariff and has a temporary advantage while we wait for India-U.S. agreement to reach its finality. CapEx: overall capacity utilization is around 80% to 85%. Our CapEx guidance remains constant, as shared with you over the last few quarters. Sustainability: at CEAT, we remain committed to net-zero journey. We recently partnered with CleanMax to develop 59 megawatts of hybrid wind solar projects, provided our manufacturing facilities at Halol and Chennai with renewable energy. This marks a significant step in advancing our aim towards achieving approximately 60% clean energy share in operations by FY2027. Also, during Q3, CEAT's Ambarnath for off-highway tires was awarded the gold medal at the 11th India Green Manufacturing Challenge. Overall, Q3 closed on a strong growth note with a jump in margin in the standalone business, strong product pipeline, and a more confident customer, and we look forward to continuing this momentum heading into the new year. With this, I would like to hand over the call to Kumar Subbiah for his remarks. Thank you, Arnab. Good afternoon, ladies and gentlemen, and thank you for joining our quarter three earnings call. I'll share some financial data points with you all, post which we can enter the Q&A session. Overall financial top-line performance: our consolidated net revenue for the quarter stood at INR 4,157 crore, with a year-on-year growth of about 26%, aided by strong volume growth across all segments. We are happy to share with you that the company crossed milestone number of INR 4,000 crore of revenue for the first time in a quarter, and the revenue reported in quarter three has been the highest achieved so far. While OEM and international business grew by more than 20%, replacement grew in mid-teens during the quarter, supported by positive momentum in domestic sales post drop in the GST rates in the month of September. I would like to bring it to your attention that consolidated year-on-year and quarter-on-quarter numbers are not comparable, as Camso revenue numbers were not part of the previous year's quarter three numbers. And with respect to the previous quarter, the revenue of Camso was considered only for a month, as the acquisition of the business happened effective from 1st of September 2025. The standalone revenue numbers, which are more comparable for the quarter, stood at INR 3,957 crore, translating to a growth of about 20.1% year-on-year and 6.91% quarter-on-quarter. Hence, the financial insights that I will share with you today would focus more on standalone numbers. Coming to operating margins, our consolidated EBITDA for quarter three stood at INR 568 crore, translating to 13.7% margin. It's a 13 basis point improvement sequentially and 317 basis points improvement year-on-year basis. While our standalone EBITDA stood at INR 556 crore, translating to a margin of about 14.08%, a 39 basis point improvement quarter-on-quarter, and 364 basis points improvement year-on-year. Our standalone gross margin for the quarter stood at 39.9%, a marginal contraction of about 109 basis points sequentially, largely arising from a drop in finished goods inventory and also a drop in other income, along with some impact on raw material costs. Coming to raw materials, during quarter three, our raw material costs were in line with our costs in quarter two. The crude prices remained stable and moved in the range of $60 to $65 during the quarter, and the crude derivatives, which go into the manufacture of tires, also remained within the same small range. While natural rubber prices remained around $1,700 per ton, however, it has moved up to $1,800 per ton in the later part of the quarter. Considering our raw material costs are based on a combination of imports and local material prices with linkage to import parity, the depreciation of INR 87 USD in the beginning of the quarter to around $91 now would have some impact on our costs going forward. We expect the margin impact to be in the range of about 1% to 1.5% in quarter four and beyond. While the overall cost environment is broadly favorable, we continue to keep a close watch on, that is, raw material situations. Coming to CapEx, during the quarter, we spent about INR 254 crore. Until date, we spent about INR 673 crore. In addition, we also had an outflow of about INR 236 crore in quarter two towards intangibles at the time of acquisition of Camso. We expect our normal CapEx outflow, excluding the intangibles that I just now mentioned for the current year, to be in line with our earlier estimate of around INR 1,000 crore for the current financial year. Our standalone working capital continued to remain negative, marginally negative. Our inventory saw a drop of about INR 212 crore during the quarter, in line with our plan, and payables also dropped by a similar amount. Our standalone gross debt stood at INR 2,954 crore against INR 2,944 crore as of end September. During the quarter, the company raised about INR 250 crore of NCD, that is non-convertible debentures from the market, and retired about INR 100 crore. Both are part of the current debt. Our debt-to-EBITDA on a standalone basis stands at a healthy level of 1.252x, which compares favorably with 1.65 that we reported for the previous quarter, and our debt-to-equity also improved from about 0.65 to 0.63. Coming to operational expenses, the standalone employee costs during the quarter moved up from INR 244 crore in quarter two to INR 252 crore. The marginal increase is largely on account of a higher level of operational activities. We leveraged scale, and that helped to manage our other expenses well during the quarter. Overall, we kept tight controls on costs, which helped in our operating expenses in quarter three to be at the same level as quarter two. However, in absolute terms, it remained constant. In percentage terms, it came down from 20.7% to 19.4%, translating to margin expansion on our standalone profits and also after absorbing the drop in gross margins. Depreciation during the quarter remained at the same level as that of the previous quarter. Interest cost during the quarter increased by about INR 17.88 crore, largely on account of an increase in the average debt level. While debt has not moved between end of quarter two and end of quarter three, the borrowings in the previous quarter moved up in the month of September. However, in the same level of debt we maintained during the quarter, that led to interest cost for the quarter going up by about INR 18 crore, and we would like to bring it to your attention: during the quarter, we made a provision of about INR 57.81 crore, arising out of notification of new Labour Codes by the central government. While the changes in rules are still under review, the company made an estimate based on the understanding of the new definition of wages applicable for gratuity and leave encashment entitlements of the employees as of 31st December 2025. This is reported in our financials as an exceptional line item, as the cost relates largely to the past period of service of the employees. Overall, the consolidated profit after tax for the quarter stood at INR 155.4 crore, compares favorably with INR 97 crore reported during the same period of last year, and INR 185.7 crore reported in the previous quarter. Our standalone profit reported a higher number of about INR 191.59 crore, which compares favorably with INR 95.97 crore that we reported at the same period of the previous year, but marginally lower than INR 202.23 crore that we reported in quarter two. The profit after tax for the quarter would have been higher, but for INR 57.81 crore of provision that we made towards new labor codes that I just now mentioned. We are also pleased to announce that the Board of Directors in a meeting yesterday approved INR 1,314 crore of CapEx for our Chennai plant, which would add additional 35 lakh tires of passenger car tire capacities. We expect this capacity addition to be progressively completed by the second half of financial year 2028. The CapEx would be funded with a mix of debt and internal accruals, as we have been doing in the past. While executing the proposal, we would continue to monitor our leverage levels and ensure that the balance sheet continues to remain strong. During the quarter, the credit rating agency CARE carried out an annual surveillance and reaffirmed the credit rating of AA for long term with a positive outlook and A1 plus for short term. With this, we can end the call and over to Q&A. 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 touchscreen telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Mumuksh Mandlesha from Anand Rathi Institutional Equities. Please go ahead. Yeah, thank you, sir, for the opportunity, and congrats on the good growth during the quarter. So firstly, to Kumar sir, so you said here going ahead, there could be a 100 to 150 basis points kind of impact on the raw material increase due to natural rubber prices going up and iron deficiency. Is it right, sir? Is that right? Got it. It could come in the coming two, three quarters, right, sir? Yeah, I see. Look, largely, you know we have visibility and cover in advance. Okay, but going into the future, considering the rupee has depreciated and a little bit of movement in the prices of natural rubber, particularly international rubber, it could come in due course of time. Got it, sir. And sir, on the labor code impact, so this INR 50 crore was mainly for the past period. So anything from the Q3 and going ahead, how much once you factor the impact, sir? See, this is predominantly on account of change in the definition of wages. And earlier, you are aware that gratuity and leave and encashment entitlements were calculated on basic salary. So with the revision in the definition of wages, it's mostly relating to the past period, but for the future, there will be an impact. Okay, our estimate is for a quarter is coming to a very small number. So it's not very significant going into the future. There is an impact. There is an impact in terms of incremental provision, but the impact is small. Say less than INR 2 crore, but maybe INR 1 crore or 2 per quarter. Got it, sir. And sir, on the Camso side, can you share how was the Q3 financial performance for the Camso in terms of revenue and EBITDA, sir? So Amit is here, Amit is heading the specialty division. I think Amit will share a few details. Yeah, so the operating numbers are as expected. The top line is as per expected. What we are trying to do is we are getting the relationships transition from Michelin to CEAT. And as Arnab informed in this call earlier, that's trending as per expectations. The top line for the quarter is roughly at $20 million, which is INR 182 to INR 183 crores. Sir, I think our EBITDA margins, sir, operating profit, right, sir? Yes. Got it, sir. On the U.S. market, how's the sales going there, sir? Has Michelin basically taken the price hike to pass on this duty, sir? Yes, sir. Necessary price increases have been taken in the market. But as you're aware, Sri Lanka has a favorable tariff compared to India. It's at 20% versus 50%. So right now, the necessary tariff increases have been passed on to the consumer. How's the demand, sir, in the U.S. market? Demand remains cyclical as the industry is progressing. Whatever is the cyclical impact and the tariff impact is seen. But again, as I said earlier, it's tracking as per expectations. Got it, sir. Thank you for this. So Kumar sir, for this new INR 13 billion CapEx for the PCR, sir, how would you split of that CapEx in 2027 and 2028? And sir, going for next year, do you see any more CapEx planned other than for PCR, sir? No, see, largely we have factored in whenever we had shared our own outlook for the next two or three years. See, look, our current annual CapEx is about INR 1,000 to INR 1,050 crore rate. That is what it is. As we are scaling up, you've seen in the first nine months, our volume growth has been over 15%. And year on year, the growth was even 20% for the quarter, but fully at basis. So from CapEx capacity creation point of view, we need to take into consideration the volume growth on a higher basis. It's likely that CapEx estimate from the next year onwards would move from INR 900 to INR 1,000 crore level to maybe INR 1,000 to INR 100, INR 1,200 crore level. We are in the process of completing our annual plan. We will make sure that this capacity expansion related CapEx outflow is within that threshold, within that overall number. As of now, we are in the process of completing passenger car capacity expansion at Chennai to take the capacity to 30,000 tires, which is under progress. Okay, and this about 30,000 to 40,000 tires capacity expansion will get completed in the second half of FY2028. Along with this, we are also expanding our Nagpur factory, taking the capacity from 80,000 tires to 100,000 tires per day. So these proposals that have been approved by the board would get implemented, and CapEx flow would be CapEx would be in line with the number that I indicated to you. Got it, sir. Got it. Great, sir. Thanks for this opportunity. Thank you. Thank you. The next question is from the line of Rishi Vora from Kotak Securities. Please go ahead. Yeah, thank you for the opportunity. My first question is on the replacement segment in the domestic market. We have seen a very strong growth, and obviously, this quarter has been even stronger than what we have seen in the last few quarters. So is it something to do with channel filling or post GST cut you are seeing a sudden resurgence in the replacement segment demand? And how should we think about this category growth going into FY2027? Overall replacement, yes, there was some channel filling because the channel destocked in September. But the growth is much more than channel filling. There is a genuine improvement in sentiment, especially for farm and two-wheeler tires, but also witnessed in the other categories, which is passenger car tires and in truck bus radials. How long this will last, whether this is just a pent-up demand coming through, we will know after a couple of quarters, but my view is that there will be a positive impact on demand overall and replacement. So at least for '27, should we continue to expect at least high single-digit growth to sustain? I think so. We can expect high single-digit growth in replacement through FY2027. Understood. And my second question is on the Camso bit, right? Because last two quarters, I know when the management had highlighted that the Camso annualized revenues is roughly around $140 to $150 million, and at least this quarter seems like the annualized run rate is around $80 million. So what has happened? Why the revenue has further collapsed? What are the factors for the same, and when should we expect at least the quarterly run rate to reach the earlier annualized run rate? And just second question on the margins of Camso, if I heard it correctly, you said this quarter margins were double-digit. But if I just do consolidated minus standalone, then the EBITDA margins are coming out to be around 3%. So what is the discrepancy over there? Can you just explain? I'll explain the top line part first. Yes, we have been saying it is INR 120 to 125 million, actually. It's slightly down from INR 140 million odd, but that's the full turnover when we realize the full turnover in terms of net sales realization from the customer. Right now, in the transition phase, we are selling to Michelin, who in turn is incurring the cost of distribution and keeping a small margin transparently with us and selling it to customers. So the markdown realization is around INR 100, INR 90, INR 100. A specific instance last quarter was a cyclone, which has resulted in some disruption of operation, which will be made up. It's a supply chain disruption. So essentially, if you calculate then, it will trend to around INR 90, INR 95, INR 100 in terms of the reduced OHT price in the transition period. So it is trending as per our expectation. There is no discrepancy there. As far as the margins are concerned, in the operating part of the margin, yes, we have recorded double-digit, and it includes one-time transition cost as well as some recurring IT costs, which were incurred in quarter three, which will stop incurring from quarter four. And below operating, I think Kumar, you can explain the situation in Camso. Look, see, I think your question was on the operating margin side. Okay. Yeah. So from that point of view, we have two line items. One is that normal operating margin. That is what Amit mentioned to you on the double digits, which is what we realized. Okay. Because we are in the first initial phase of acquisition and change management, there are some IT costs we incurred in this three or four months' time and some other transitional expenses, which are called as, which we have booked as normal expenses. Okay. So those costs are more relating to quarter three and maybe in the first month of the operations. Okay. So whenever we do an internal management reporting or performance reporting at that point in time, we remove what is specific to a one particular quarter, more a transitory is removed for the purpose of evaluating and operating performance. So if you remove it, it is a double-digit number. And most of those costs have been already incurred. Okay. And we should be able to sustain a double-digit kind of a margin going into quarter four. But when we reported these numbers on a consolidated basis, we have taken them as expenses. We have not called them out as a separate exceptional line item. And therefore, when you read it, it appears as a single-digit margin. And so when should we expect a normalization? Like FY2027, hopefully, should be then a normalized year in that sense. Some of the one-time costs relating to IT transition, etc., I think we have done and dusted as of 31st December. Okay. But going into January onwards, those expenses will not be incurred. So at least the reported margin should also trend towards double-digit by 2027, low double-digit margin. Sure. No, I think you will see that from quarter four onwards. Reported margins will be in line. See, one more point before you follow up with another question. In the P&L of that particular entity also has two other elements of cost. One is the depreciation cost, and another one is interest cost. Interest, large part of the interest cost, it is also accrued in our books, see at India Books and consolidated, it will get netted off. We have given in the current capital structure, okay, a reasonably large amount is taken as a debt in the books. Okay. Keeping in mind repatriation part of flexibility, we will recast it maybe by end of quarter four, and depreciation cost is still at an estimated level. I think in the quarter four, we are in the process of assessing the life of the assets to ensure that the depreciation that we take into books is based on real assessment of the life of the assets. Those are below operating line item point of view, but coming back to your question, I think you would be able to see that margin visible in the reported numbers from quarter four onwards, that double-digit kind of a number, because we are unlikely to incur those costs starting from January. Understood, and when would this complete transfer from Michelin take place? So like today, you said that there is a markdown which happens, so when should we expect that business transfer to happen? So there's a transfer at two ends. One is the customer transfer, and one is the raw material purchase that we do. So the raw material purchase that we do will stop when we erect our mixer and calender, which will take another three-to-five quarters to completely come to us. On the front end, customer transfer has started. We have already started looking at a few customers. In this quarter, it will accelerate in quarter four, and maybe by quarter one, quarter two, we should be done with it. So then realization should normalize by second quarter next year. From the front end, it will do faster? Yeah, you're right. Correct. Understood. Understood. Thank you so much, sir. All the best. Thank you. The next question is from the line of Mihir Vora from Equirus Securities. Please go ahead. Yeah. Thank you for taking my question. So sir, my question is a bit clarificatory in nature. So in July, we had announced a CapEx of around INR 450 crore on the passenger car tires capacity in Chennai itself, which was roughly around 35% of the capacity then. So that is the 3.24 lakh tires, assuming. So now we have announced another INR 1,350 crore on CapEx. So is this including the INR 450 crore, or that is a separate one, and this is something which is separate? This is independent of that. Okay. So what we announced in the month of July was taking our capacity to about 30,000 tires per day. Okay. And that is under implementation. We hope to complete that execution in the coming financial year by quarter three or quarter four of coming financial year. This INR 30,000 tires to INR 40,000 tires is over and above that, okay, which will get completed maybe a year later. Right, and sir, so basically, when we do the back-of-the-envelope calculation here, the cost, the ton per day cost, the CapEx cost per TPD comes out to be higher this time, so what has changed in the CapEx here? Okay. See, this translates to about INR 140 tons a day. Okay, and passenger car radial tires' average weight is progressively going up, so therefore, we expect our incremental requirement to have a higher level of weight of the tires. We will have all the flexibility to produce more number of tires should the upstream capacity being higher and average weight of the tire being lower. Okay. What we intend to do is that so if you really look at the total CapEx and divided by the tonnage that I just now mentioned to you, it will be broadly in line, broadly in line with what we have incurred so far. All right. All right. Okay. Okay. Sir, just a follow-up on this. Like our capacity expansion in the PCR category has been quite strong compared to our peers. So what steps in terms of even in terms of market, in terms of pricing, would we be taking to utilize this capacity? And basically, what growth are we expecting here? Because the industry would be growing at the 6% to 7% in terms of OEM, but our capacity expansion has been in a strong double digit. Yeah, so we are looking at growth in all three verticals. International is growing strongly as we keep consolidating our market share in several countries where we play: Latin, Europe, and the US is yet to play out. So we are experiencing strong growth. In domestic OEM, as I mentioned, we had exited several vehicles over the last two, three years. So our base was low last year. We are getting entries in several vehicles, high-volume vehicles from across OEMs, including some EVs. So that growth is coming up, and most of that growth is coming in the OEMs in the higher rim sizes. So when that happens, the average tire weight, as Kumar explained, goes up. And therefore, in terms of tonnage, we need higher capacity. In terms of numbers, of course, we need higher capacity. We think we have some headroom to grow our share in OEM even now, much as we are growing in this year over a low base of last year. Coming to replacement, we are at the third rank now behind two more players, and there is a gap of about 3.5% to 4% between us and the market leader, so in the next three to four years, we expect to bridge this gap over a period of this time, and our ambition is to definitely go for market leadership in this segment. We have been doing well. The premiumization journey is going well. In terms of pricing, we are actually introducing many higher technology tires such as the foam tire, which is a Camso tire, the Z-rated tire, the run-flat tire, and taking the average, trying to take the average realizations up in this category. The selling price of the dealer to the consumer is also trending up. And over a period of time, with volumes, the margin profile should actually improve. Right. Okay, sir. Okay. That answers my question. Thank you. Thank you. Participants who wish to ask a question may press star and one. The next question is from the line of Vijay Banerjee from Nuvama Wealth. Please go ahead. Hi, sir. Thank you for taking my question. A couple of questions, sir. So when you say double-digit EBITDA margin for Camso, is that like should we expect it to be around 10, 12%, or is it high teens or more than 15%? Because Camso, in general, when we will have the full build-up, that will be at around 20% EBITDA margin, right? Yes. So when we said in quarter three, what was it? It was just about teens, low teens. Without any improvement, too much improvement in the business traction, which is a volume traction, after the one-time costs, etc., are removed, gradually it will trend towards mid-teens, and we did talk about 20% and above. That will come when we take complete control of customers as well as the material supply at the back end, and we start improving the capacity utilization of the factory, which is currently standing at 50%. When the volume traction comes, yes, it should move up from mid-teens to around 20%. Okay, and sir, now in terms of coming to the domestic market, how are you seeing the growth in the fourth quarter for all the segments, especially on the replacement side? If you can just briefly help us map the growth. Yeah, fourth quarter seasonally is a mixed quarter. January is usually low because of winter in north and east. I'm talking of replacement, whereas March is usually high because of the onset of summer. So it's a mixed quarter, Jan to Feb, March, usually. However, we have the positive impetus due to the GST reduction. The growth has been pretty good in the month in quarter three. We have to see if it sustains. If it sustains, we'll have a very good quarter again in Q4. Otherwise, it may moderate a little, but the net positive impact of GST will remain. And in terms of channel inventory, they are still at normal level or for the replacement? Channel inventory has normalized completely. Okay. Okay. And lastly, sir, in terms of just wanted to if you can clarify in terms of the components about the raw materials, because international rubber prices have increased, so how is the domestic rubber prices looking and other components like carbon, fiber, and other oil-derivative products? If you could just clarify those prices. Okay. See, local prices are in the range of INR 185 to INR 190 per kg. Okay. So no major change in the last three months. It's been up and plus or minus in that range only. International prices have moved up by about $100 per ton. It's hovering about $1,800 to $1,810 per ton at this point in time. The impact of currency is there on the imports. So therefore, there's a little bit of adverse impact. Carbon black prices are expected to be a little lower in the current quarter because the average crude level prices were lower in quarter three. Generally, the previous quarter's movement of crude and the feedstock that goes into carbon black is called a CBFS, remained a little on the lower side. So therefore, that is where it is. Generally, we have one quarterly price for carbon black. Synthetic rubber prices from beginning to end of the previous quarter, particularly something called butadiene that determines the synthetic rubber prices, remained in a particular range. The average price toward the end of the quarter or the end of the quarter price was a little lower than the beginning of the quarter. And therefore, average for quarter four is likely to be a little lower than quarter three. And steel and other prices, we don't expect any major change to happen in quarter four. So considering synthetic rubber also has import parity kind of a pricing, some portion of it is imported, etc., currency could have an impact on it. So overall, our assessment is 1%-1.5%. Sequentially, the raw material basket cost could move up. It is subject to our recipe, subject to categories and things like that. That That is what our initial estimate is. And sir, this 1% to 1.5% headwind is probably because coming from the currency side. Yeah. Correct. Currency, see, currency impact is on average about 3%. Okay. Some feedstock prices have moved up, some of them down. And considering we have already covered some portion of the raw materials, 1% to 1.5% is largely currency and a little bit of natural rubber. Okay. Okay. Thank you. Thank you. The next question is from the line of Nitin from JM Financial. Please go ahead. Hi. Thanks for the opportunity and congratulations on the set of numbers, so my question is regarding the demand in the international market, especially for OHT and agri. So where do you see demand— turning out for, say, next quarter or going into FY2027? See, we have our big markets for agri remain Europe, Canada, South America, where we supply to some OEMs, as well as Australia, South Africa. So we continue to trend on these markets. From a tariff point of view, we have little exposure in the US, not significant. And so apart from US, all these markets that I mentioned are the markets that we shall continue to focus on for the agri business. Okay. So we can see stabilization and going like low single-digit growth in those markets, those categories. Yes. We expect that. Okay. Okay. That's it from my side. Thank you. Thank you. The next question is from the line of Mitul Shah from PL Capital. Please go ahead. Thank you for the opportunity and congratulations on all of our strong performance. First question. I'm sorry to interrupt you, Mr. Shah, but we are unable to hear you that clearly. Hello. Am I audible? Y es, please go ahead. Yes. Thank you for the opportunity and congratulations on a strong performance. Sir, my first question is on replacement demand for the quarter. If you can help with some ballpark number for industry for various segments for replacement like CV, farm equipment, PCR. And related to this, I want to understand how much would be contribution of the restocking in this. As we heard from the channel check that during the GST-related challenges, initially, inventory used to be 15 to 20 days, which went down to about two, three days. And post-GST, again, restocking started. So what would be the number in terms of the inventory at the beginning of October and at the end of December, approximately? Thanks, sir. This is the first question on replacement side. As I mentioned, the inventories have normalized. So if you have picked up 12 to 15 days of inventory in retail, that's the level of inventory roughly at the end of the quarter three. So the downstocking of September was made up in the month of October itself, and then we witnessed a good offtake, which was replenished. So there is no further delta that we expect in inventory going forward. So I had mentioned during my initial address that replacement demand has been strong for MHCV, high single-digit, and two-wheeler has been constantly almost double-digit kind of growth in two-wheeler, especially in scooter tires. And passenger had been lukewarm in the first half, but quarter three has been also mid to high single-digit for passenger car tires. And do we expect trend to continue at least for one or two quarters for replacement? We have to wait and see. I won't stick my neck out and say that these trends will continue, but there will be a net positive impact. I think overall, quarter four will be better than first half. Okay. Sir, second question on the Camso side. In this quarter, how much would be the gross margin benefit? Not asking exact absolute number, but directionally. And going forward also, how do you see considering the cross-currency impact as well as all other raw material-related parameters, gross margin for Q4 for Camso? Gross margin is, again, moderated because we are in a transition state. So in the transition state, whatever gross margin we had expected, by and large, it is trending, barring one adjustment for steel prices, where we have taken a hit on gross margin, and we are aware of that. But this will be, again, made up by passing on the prices to the customer over quarter four. So we'll be back to normal kind of gross margins as we expecte d before the deal closed. Yes, sir. Thanks, and all the best. Thank you. Thank you. The next question is from the line of Vignesh Iyer from Sequent Investments. Please go ahead. Hello. Just one clarification I wanted. I heard you say that there is a one-time expense that we incurred in Camso in this quarter, which is not expected to repeat in quarter four. Sir, can you quantify the amount of expense that we did? Okay. See, look, overall, for the quarter, it would have been about 4% to 5% of the revenue was the kind of expenses that we incurred in quarter three that we wouldn't incur in quarter four onwards. Okay. Yeah. That's what I was expecting. Yeah. Yeah. Thank you. The next question is from the line of Mihir Vora from Equirus Securities. Please go ahead. Yeah. Thank you for taking my question again. So, sir, just some idea on the truck bus radial or the commercial vehicle segment. We mentioned that we had grown mid-single digit in the MHCV category. But going into the segment, how are we seeing the demand sustaining going ahead? And color on the subsegment, or how are we seeing the turning shifts happening here? Is it moving toward higher turning? Or still we are there into the haulage segment only? Some color on that as well. Are you talking of replacement market? Y es, sir. Yeah. So replacement. Both the OEM and replacement, both the. Yeah. So OEM, it has shifted towards 16-wheelers, as you know, and the demand is concentrated in 16-wheelers in MHCV. There's a good demand from LCVs and small commercial vehicles also because of e-commerce and growth in quick commerce. So that segment is witnessing very strong growth as well, high double-digit, in fact, in OEM. In replacement as well, the tires for small commercial vehicle, light commercial vehicle, as well as the full range of MHCV overall is growing at a high single digit. And we expect this growth rate to accelerate because the summer season is the big season for this. So March to June, this growth should hold at this level, if not more. So we expect this to grow. And MHCV had been very tepid in the first half in OEMs. It has come alive in quarter three. So it may moderate a little, but this cycle should last a few more quarters, maybe two to three quarters, up to June, definitely, is what I think. Right. And sir, basically on the replacement front also, now that because of GST, we may see fleet utilization improving. So are we seeing that traction also on the ground that trucks are coming in for replacing the tires and going ahead? What do we think there, specifically on the MHCV? Yeah. In replacement also, we have seen some traction in the demand of tires in quarter three, which is usually a down quarter because of onset of winter, whereas we have seen traction in Q3 to be better than quarter two, which is obviously because of the GST rate reduction. And how much this will sustain, we'll have to wait and see Q4 and Q1. But as I mentioned, we should have a net positive effect vis-à-vis first half, that is, before the GST decrease happened. All right. Okay, sir. Thank you. That's all from my side. Thank you. Ladies and gentlemen, as there are no further questions from the participants, I now hand the conference over to management for closing comments. Yes. So thank you. Happy New Year once again. And this is the last quarter. So we hope to see you at the end of the year with a full-year performance review, and we shall share that with you. Thank you very much. Thank you. On behalf of Equirus Securities Private Limited, that concludes this conference. Thank you for joining us, and you may now disconnect your line.