Ladies and gentlemen, good day, and welcome to the Nava Limited Q1 FY25 earnings conference call, hosted by ICICI Securities 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 touchtone phone. Please note that this conference is being recorded. I'll hand the conference over to Mr. Mohit Kumar from ICICI Securities Limited. Thank you, and over to you, sir. Thank you, Neha. On behalf of ICICI Securities, we welcome you all to Q1 FY25 earnings call of Nava Limited. Today, we have with us Mr. Ashwin Devineni, CEO, Mr. Nikhil Devineni, Senior Vice President, Mr. Sultan Baig, CFO, and Mr. V.S. Raju, Company Secretary. Without much delay, I will now hand over the call to the management for opening remarks, which will be followed by Q&A. Thank you, and over to you, sir. Good afternoon, everyone. I'm pleased to welcome you all to our quarter results call. Today, we are here to discuss the financial results for the quarter ending 30 June 2024. I am delighted to report that Nava Limited has sustained its growth momentum with robust performance across all our business divisions. This quarter, we achieved our highest ever quarterly income of INR 1,252.4 crore, marking a 16.7% increase year-on-year. Our profit before tax has also reached a record INR 513.8 crore, reflecting a 27.6% growth compared to the same period last year. These numbers are a testament to our strategic focus on operational efficiency and cost optimization, enabling us to navigate market volatility effectively. Our energy division, both in India and Zambia, has shown remarkable results. The Maamba Energy Limited power plant operated at a near-perfect 100% plant availability, contributing significantly to our consolidated revenue and profitability. We have also commenced the construction of an additional 300 MW power plant in Zambia, which will further strengthen our position in the energy sector. In the metals division, we reported a profit before tax of INR 23.2 crore compared to a loss of INR 1.6 crore last year, driven by higher realization and successful product diversification to ferrous recovery. Our mining division sustained a robust wholesale, contributing to our overall positive financial performance. Furthermore, I'm pleased to announce that Nava Bharat Energy Limited has started paying dividends to Nava Limited, and Maamba Energy Limited has commenced discharging a cumulative interest to the sponsors with $19.5 million received since April 2024. These achievements highlight our commitment to enhancing shareholder value and generating reserves for future growth. Our agri business has also made significant strides, with Nava Avocado Limited successfully completing the plantation division eight, with over 90,000 trees and preparing for the next phase of planting. This aligns with our vision of sustainable agriculture and environmental stewardship. In summary, our diversified portfolio and robust business model and has enabled us to deliver strong financial results and position ourselves for sustained growth. I want to thank all of you for your continued support and confidence in Nava Limited. Let us now open the floor for any questions you may have. Thank you. Thank you. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on their touchtone 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 a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Nidhi Shah from ICICI Securities Limited. Please go ahead. Hello, am I audible? Yes, ma'am. Yes. Thank you so much for taking my question, and congratulations on a great quarter. My first question would be on the, on the Maamba Energy Limited, the 300 MW land. Do we have a PPA in place for that? And what are the terms if the PPA is there? Yeah. So we do have a PPA that has been signed and also been approved by the Energy Regulation Board. The PPA terms are, it's a 20-year PPA, and the offtake starts at post-COD, which is going to be 2 years from now. Okay. Okay. So, starts two years from now. Okay, and, my second question is on the MBEL, you gave the PBT numbers in the presentation. Could we have the revenue, EBITDA, and PAT numbers? And, simultaneously, do we have any tie-ups for this plant for the balance nine months of the quarter? For Maamba Energy, the total revenue for the first quarter was at INR 201 crore, and profit before tax is INR 68.2 crore, and profit after tax is INR 44.4 crore. For the current quarter, the plant operated at 91+% PLF. We have bilateral contracts, and overall, for the year, we anticipate it to be over 70% PLF. Okay. And my absolute last question would be is that the interest costs have come significantly down this quarter. What is the reason for that? And is this something that we will see over the full year, or is this a one-off? The debt has been completely repaid, both at Maamba Coal, Maamba Energy, and also Nava. That's why there is no interest cost. All right. All right. And you are you, are you planning to, you know, bring back debt in anywhere else, or this is what we broadly assume the situation could be for the next one or two years? I could not get you. Broadly, being debt-free is the plan for the next one or two years, sir? At Nava, it is certainly, yes. But at Maamba Energy, we [inaudible] for the phase II or 300 MW expansion, there will be certain debt on the books. All right. All right. Thank you so much. On a consolidated level, we're not going to be debt-free because- Mm-hmm. Yeah. We have inaudible. Mm-hmm. All right, thank you so much. Thank you. The next question is from the line of Sandip Mathivanan from MoneyGrow Asset. Please go ahead. Okay, thanks for the opportunity, and congratulations on good set of numbers. I just have one question: So the gross margins have increased from 65%- 70% year-over-year. Is this primarily due to a decrease in coal prices, generally RM costs have come down? Or are there any reduction in other RM costs contributing to this improvement that you would like to highlight? Thank you. It's a combination of two factors, operating at high PLF and also reduction in the coal prices. Okay. Okay. Thank you. Thank you. Thank you. The next question is from the line of SG Kankani from SG Kankani & Associates. Please go ahead. Good afternoon, gentlemen. I am very delighted to see the performance of the company in the first quarter. I just have two questions. One is that, what is the present tariff in the present PPA? And, as you have mentioned in the presentation, in the, in the PPA, which you've already entered into, the tariff is 9.7... 9.5 cents. So what is the present tariff applicable in the present contract? Currently, the phase one tariff is $0.103. $0.103 Twenty thirty-six. The present tariff being negotiated is lesser than the present tariff? It is $0.097-$0.095 as compared to $0.103. Yes. Okay. Sir, this is the first year tariff. Whether there will be increase in every year, as compared to the cost of production, or what is the second year, third year, what is the provision in the present PPA, which the company- Is linked to U.S. PPA inflation, index, every year. Okay, okay. And then, my one question was this thing that, what is the expected revenue from avocado product in the next financial year? As I read that in the next financial year, the production will be there of avocado. So what is the expected revenue from this product in the next financial year? So next financial year, revenue will be small, about $3 million-$4 million, but the peak revenue will be from 2027, 2028 onwards. 27, 20 onwards. Okay. Okay. Thank you, sir. Thank you, sir. Thank you. The next question is from the line of Viraj Mahadevia from Moneygrow. Please go ahead. Hello. Congratulations to the promoter group and the managing team on excellent results. The question, what was the free cash flow in Q1, and any non-core asset sales planned by the company, such as the Hyderabad land parcel or sugar plant land in Samalkot? So, I mean, you want to talk on the free cash flow? No, so I think in terms of the land parcels, definitely valuations have increased. Especially we have the Samalkot land, and then we also have the Dharmavaram land. I think, the valuations are definitely increasing. There's a lot of lot of investors looking at setting up shop within AP now. Right. I think we're going to hold on and look at opportunities. There's no urgency for us to sell. I think it's a good call, and we also held on to the land parcel, specific, you know, so basically, enjoying the fruit of the valuations going up. Mm. We're always evaluating opportunities, and when the right opportunity strikes, I think we will move. Understood. I'm sorry, the free cash flow, Ashwin, in Q1? The free cash flow that the group level will be about INR 500 crore. INR 500 crore in Q1. Fantastic. So my next question is, Ashwin, and, you know, I think I've brought this up a few times before. Obviously, a remarkable job by, by yourselves and the team in making this debt-free, and now net cash, both with incremental-... arbitration awards coming through, as well as the organic cash flow generation. But, you know, given that scenario on net cash, what are the planned use of proceeds? I've seen that you've declared an interim dividend of INR 4, but that's only, sixty rupees, INR 60 crore. So how do you plan to really reward shareholders for this cash pile that's building up? Yeah. So I think we've started by rewarding. I mean, at the end of the day, we just started receiving the funds. We were getting all, I mean, while we were getting paid in Zambia, we were clearing up all our debts for phase one, which has enabled us to, you know, become debt free and essentially embark on phase two. So as we kind of start getting if Maamba starts declaring more dividends and paying off its shareholder loan, we will definitely look at other corporate actions that, you know, benefit shareholders and increase the company value. And also, you know, we are pretty embarking in terms of expansion of Maamba, the Avocado project, the Ivory Coast project, and we have other things that we are currently exploring. So we're definitely going to leave a significant chunk out for growth capital. Yeah, that's basically how we plan on getting the cash that comes in. No, I appreciate that. I mean, just correct me if I'm wrong, but Avocado plus the equity contribution on the second 300 MW plant, plus Ivory, would probably not be more than $150 million, which is about INR 1,000 crores. The company is generating INR 500 crores in free cash flow per quarter, plus you have an incremental INR 1,200 crores to come in from arbitration. Now, the government is obviously, in the recent buyback rules, allowed a relaxation till the first of October, so that's one avenue. Two is obviously dividends, but seem to see either of the two or both come through for shareholders. No, so I see. In terms of the arrears, payments and so on, there is still some due. We hope when it comes, we can take certain, you know, aggressive corporate decisions with regards to increasing the shareholding value. But we are essentially going at this, you know, because it's not a... Nothing is guaranteed here. So, we're really trying to ensure that ZESCO pays on time, pays the arrears, and I think once we get the cash, we will definitely take certain corporate action. Yes, so in terms of expansion, you know, if you look at the equity portion of the Avocado and Mamba, you're looking at about $100-$120 million. Right. We are looking at other opportunities, too. You need to understand that we are in certain sectors that could be, you know, phased out in, say, 20 years, 30 years from now. So we do need to kind of grow other verticals. So definitely we would want to save some cash for, you know, other verticals that we want to get into. Understood. All the very best on, on the growth and the shareholder value enhancement. Thank you. Ladies and gentlemen, you may press star and one to ask a question. The next question is from the line of Govind Lal, individual investor. Please go ahead. Thanks for giving me opportunity, and, congratulations to the whole team Nava for this great set of numbers. All cylinders are firing, sir. So as a shareholder, I'm very happy. So I've got two, three questions, sir. First, in that last call, result in May, you are told that corporate action will happen very soon and sooner than later. That is the words that you used. So it is three months over, sir. So what is this very soon, sooner than later? Something you can define, sir. Yeah. So, I mean, we did say three months later, and we did take a corporate action by declaring an interim dividend. So I think, we just started receiving cash from our, Zambian subsidiary, and as soon as we have, we have declared an interim dividend, like promised. the overall bigger picture, this very dividend is a very small. We thought that corporate action something big, as a shareholder we are receiving. So it, it is a very small gesture. It's, so does that, what we entered last fall, this is something small, this more or something more is in pipeline? So, sir, we, you see, you have to... We take decisions based on what we have. We just started receiving money, so we've taken a corporate action. Now, we are working hard to get the remainder of the arrears paid and everything, and once that comes, we will take larger corporate actions. So it is very hard for us to, you know, pre-decide on actions that we take, and we don't have the money sitting with us. Yeah, I got it, sir. Then, my second question is regarding this tax rate of our, our second phase. So we'll be getting similar holiday, what we got for phase one, for second phase also, tax holiday? Yes. Hello? Yes, we will be getting tax holiday, similar to the phase one and phase two as well. Phase I, first five years, so I get what we have got for Phase I, same similar pattern we get for Phase II also? Yes. Oh, okay. Then last question is, sir, regarding these dues, how much we have received, sir, between May, June, this three months, arrears, how much we have received arbitration arrears? In the current quarter, we received $15 million. Fifteen million. $29 million. Now, now, how much is it as on today? INR 229. 224, sir. 224. 2024. Now, we have to receive, I think, $25 million every month, going forward. I think, this August is due of, $25 million. My understanding is right, sir? No, so this is, it's a very dynamic situation. You need to also understand that, right now Zambia is going through a big power crisis. A lot of the revenues that the ZESCO thought it would have, have, are not there because of their hydro is working at, suboptimal, plant load factor. So we are in constant discussions. They are paying us a certain amount every month, but it's a very dynamic thing which is happening during discussions. We are also trying to work with them rather than being unreasonable. So I don't think we can communicate numbers right now, but on a month-on-month basis, they are paying a certain amount, and that's based on those agreements that we are having with the unit. I got it, sir. So just, further to this question. So this equity contribution for phase two, what we are putting, this money will come from our areas only, you know, sir? These are some other points we'll be putting into the contribution. Yeah. So I think, I think the good thing here is the way we structured the project finances, the equity is rear-ended, unlike what it was for the initial phase one project. Which means our equity comes at the end, and we made it very clear that the equity would be from our side, would essentially be from the Nava side. So what that essentially means is there won't really be a contribution from the Nava side. Actually, more so, so just to have more clarity, so out of INR 100 crore, including INR 65 crores, we have to put. Those INR 65 crores, we are not putting from our side. It will come from areas that amount will be putting. My understanding is right, sir? So that is our plan. We plan on, you know, as Maamba gets money and as it declares dividends to Nava Bharat Singapore, Nava Bharat Singapore will use that cash to fund this equity portion. Yeah, yeah. Got it, sir. Last, if you can tell me one- It seems like we have lost our connection, participants. We'll take a question from the line of Nidhi Shah from ICICI Securities Limited. Please go ahead. Hello. Yes, thank you so much for taking my question again. I basically wanted to ask that what is your CapEx guidance for the full year, and how are you going to plan it across the quarters? Nidhi, the line has been very unclear. Can you come again, please? Am I audible now? There's a lot of disturbance at your end. Yes. So I wanted to know what is, what is the CapEx expenditure that you're looking at for the full year, and how are you going to plan it across, the various quarters? And, yeah, so that, that is basically the first question. Yeah. So in terms of the Indian operations there, to date, currently, as we stand, there's no large CapEx plans. I think most of the plans emanate from our overseas operations, which include, you know, the Maamba Energy expansion on the avocado side, since we are now looking at, you know, putting together a pack house and also, you know, we've got exploration activity in the Ivory Coast. And also the, you know, the lithium assets that we have recently acquired exploration license. We plan on starting the exploration activity there, too. O- also, the ferro alloys, we saw this quarter that the profit had jumped quite a lot, your EBIT margins from as compared to YOY. So now, is this something that we see as a normalized rate of EBIT from the ferro alloys segment, or is there, you know, is there still this period where we're still in the growth of this segment and we will see margins maturing further? Well, unfortunately, no, because the prices which you're seeing in quarter one have tapered down in quarter two. But having said that, I mean, we are also taking some mitigative measures, particularly with respect to diversification of different products, so that is helping us retain the margins. And, similarly, even for the existing, the bulk product that we produce, which is Silicon Manganese, we have a long-term agreement with overseas customers. So that is faring much better than, say, what the domestic market is offering. So these things are helping us alleviate the situation that we're facing today, but it's very different from what we had in quarter one. All right. All right. Thank you so much. Thank you. Ladies and gentlemen, you may press star and one to ask a question. The next question is from the line of Ruchita Kadge from Wealth Management LLP. Please go ahead. Yeah. Hi, thank you for taking my question. So sorry if I missed on this point. So just wanted to understand on ZESCO. So, currently, for this year, how much amount are we expecting from them? In terms of the arbitration. Yeah. So like we said, the outstanding amount is $224 million, okay? They are right now paying us about, on a monthly basis, about $5 million towards the arbitration. They have to start paying a larger amount in the tune of about $25 million per month. Now, unfortunately, given the current situation there, their revenues have also kind of come down because of the bad rains and the fact that they're not able to generate as much power as the earlier installs. So we currently are in discussions with them. You know, they are very determined to kind of clear the entire 224. In fact, they are working on other initiatives, such as taking loans to really clear this, but it is under discussion. So we can't commit as to any payment plan in terms of how much they will be clearing every month, but they've been paying us $85 million on a monthly basis, towards clearing. Okay, understood. Sir, what is the status on the magnetite exploration that you were supposed to start? So we have been undertaking exploration activities. We do feel that there is high-grade magnetite there. So the activities are currently ongoing, and like any exploration activities, these are time-consuming and, you know, we will only get the results later. Okay. Sir, just one question is regarding the unallocated, the other segment that we report. So this quarter, you know, the EBITDA has come at around INR 70 crore. So just wanted to understand, what does this others consist of? Yeah, these are technical services. These are technical services, and also in terms of... Inaudible. Yeah. So it's essentially technical services, which includes services that the company provides, and also operation and maintenance, services that the company provides. Okay, the operations and maintenance that happens at, Zambia? Yes. Okay. Okay. Understood. Understood. Okay, so that's it from my side. Thank you. Thank you. Ladies and gentlemen, you may press star and one to ask a question. The next follow-up question is from the line of Viraj Mahadevia from Moneygrow Asset Private Limited. Please go ahead. Hi, thanks for taking my question. When is the Zambia phase one tax concession valid until? I'm sorry, can you repeat that? When is the Zambia Phase One tax concession valid until? Current financial year is the last financial year for the first five years of tax holiday. Then the next five years will commence from first April 2025. Okay. Understood. So after the current financial year, FY 2025, there will no longer be a tax concession? And what will be the tax rate going forward there? 30%, corporate tax rate of 30%. 30%. Understood. Thank you very much. Thank you. The next question is from the line of Govind Lal, individual investor. Please go ahead. Hello? Yeah. Just to clarification on the previous participant asking, so this year we are adjusting first five years tax concession. So next year, I don't think it is full tax 30%. It is for next two years it will be 15, after that it will be 20, 30, like that, I think. So my understanding is correct? Yes, absolutely. No, no, just your answer to previous participant that it will be 30%. That's what I am clarifying. Yeah. Yeah. How much it will be from next year then, from nil to? First two years it will be 35%, then the next three years will be 50%. Yeah, that I wanted to have clarification. Then, last one more question, sir. This quarter was very phenomenal, yeah. So, the Zambia, okay, that is a regular business. This Indian operations, this power, all that any seasonality is there, first quarter it is something bumper, something like or how, how it is, four quarters, is distributed, on power? Say, like, any color can you give, sir? Generally, for power, during the first quarter, there will be demand for power will be generally high, especially from the northern states. That's why more power energy sector companies generally does better in the first quarter. And the demand for power slightly reduces in the Q2, but again picks up in Q3 onwards. Follow-up, sir. Then last one question, how much arrears you have to still write back, sir? Every quarter something, we are On the arbitration account only, $224 million. No, no, no. The unit loss, so we are... How much more is the credit loss to be, allowed for, expected? $31.9 million. Still $31.9 million is to be reversed? Yes. Yeah. Great, sir. Thank you very much, and done, sir. Thank you. Ladies and gentlemen, you may press star and one to ask a question. The next question is from the line of Vijay, an individual investor. Please go ahead. Yeah, I missed the part about Ivory Coast exploration. It was last time it was said that this exploration had not given encouraging results and you have given it up. Now, what is the next that is happening in Ivory Coast? So we're actually actively pursuing other options. Ivory Coast, at the end of the day, does have decent mining potential. So we are looking at other options, and, as and when we get them, we'll disclose it to you. As of now, we do not have any opening in Ivory Coast as far as manganese ore is concerned? No, we do. Essentially, you know, the way it works with these concessions is you can have multiple concessions. One did not prove very fruitful, but there are other concessions that we are exploring in Ivory Coast. So it's not that we've given up on Ivory Coast, it's just that you find the most economical concession, and that exploration activity is still continuing. Coming back to the ferroalloy operation in India, every time somebody asks about the monetization of land parcels, it is replied that there is no opening for usage of that money at for the moment, and the price is going up, so we are holding on to it. So what are we doing about expanding our ferroalloy capacity or the power generation capacity in India when we have the source of money for funding it? Well, I think, you know, if you look at the last year, the ferroalloys division, with the capacity that we had existing, proved hard to turn profitable. And that's mainly on account of, you know, your input costs are essentially the same as the competitor. Unless you backward integrate and have access to your own raw material, in this case, it's manganese ore. So we're pursuing that very actively. I think once that does take place, then a call for expansion could be justified. But at this juncture, when there's already an oversupply in the market, it doesn't make sense to expand. Thank you. Ladies and gentlemen, you may press star and one to ask a question. A reminder to all the participants, you may press star and one to ask a question. As there are no further questions, I would now like to hand the conference over to the management for closing comments. In conclusion, I want to express my gratitude to our dedicated team, you know, for everything, and I hope we've answered all your questions. We remain focused on our long-term goals, future diversification, and global expansion. We look forward to also delivering clean growth and value to all our shareholders and stakeholders. Thank you very much. Thank you. On behalf of ICICI Securities Limited, that concludes this conference. Thank you for joining us, and you may now disconnect your lines. Thank you.