Ladies and gentlemen, good day, and welcome to the Q2 FY 2024 earnings conference call of Control Print Limited, hosted by Asian Markets Securities Pvt. Ltd. This conference call may contain forward-looking statements about the company, which are based on the beliefs, opinions, and expectations of the company as on date of this call. These statements are not the guarantees of future performance and involve risks and uncertainties that are difficult to predict. Actual results may differ from such expectations, projections, et cetera, whether expressed or implied. Participants are requested to exercise caution while referring to such statements and remarks. 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 now hand the conference over to Mr. Karan Bhatelia from Asian Markets Securities Pvt. Ltd. Thank you, and over to you, sir. Thanks, Michelle. Ladies and gentlemen, good afternoon, and welcome all to the Control Print Limited 2Q and first half FY 2024 earnings conference call, hosted by Asian Markets Securities. From the management side, we have Mr. Shiva Kabra, Joint Managing Director, and Mr. Jaideep Barve, CFO. Now I would like to hand over the call to Jaideep for his opening remarks, after which we shall open the floor for Q&A. Thanks and over to you. Hello, everybody, and good evening. I'm Jaideep Barve, the Chief Financial Officer of Control Print Limited. Welcome you all to the earnings conference call for the second quarter and the first half of the financial year 2023-2024. We appreciate that you've taken out the time from your busy schedule to attend this call. Hope you are all enjoying the Navratri festival, and wish you and your family a happy Dussehra in advance. Mr. Shiva Kabra, our Joint Managing Director, also joins me on this call. The detailed presentation has already been put up on our website, as well as in the presentation notification on the exchanges for this call. A brief analysis of the standalone financial statements for Control Print Limited for the quarter ended September for financial year 2023-2024 as follows: Revenues, we have achieved the highest ever Q2 operating revenues of INR 83 crores. This has led to the record half year ended operating revenues as well. The corresponding figures in the financial year were INR 68 crores as compared to INR 80 crores of this year. The increase in the H1 business by about INR 30 crores augurs well for the growth trajectory of the company. With improved industrial production in the country, we've seen an increase in the sales for both the printers as well as consumables as compared to the previous quarter. We continue to consolidate our position in large accounts and gradually increase our installation base in multiple printer accounts. With respect to the expenses, our consumption has remained steady at approximately 40% of the sales in the second quarter, which is more or less in line with the first quarter of FY 2023-2024. However, we can definitely hope for an improvement in reducing this in the current financial year with optimized buying strategy. Employee costs, depreciations, manufacturing costs and other costs are all incurred in line with the business operations. Profitability level, our PAT for Q2 is 17.5%, and the PAT for H1 is 17.68%, which is almost 1% increase as compared to the similar period of FY 2022-2023. The EBITDA, PBT, PAT and the EPS, which excludes exceptional items, has grown by 18%, 25.5%, 28%, and 28% on a YoY basis. There is just a considerable amount of improvement due to higher revenue, which will result in this year and complemented by economy of scale. With regards to the way forward, we have got focused marketing plans. We've got targets given to both our sales as well as inside sales teams. We have got better focus on our key accounts. We are increasing our installed base, and we expect some good amount of traction in the business out of the Markprint acquisition, as well as with the new technologies like Cut and Crease. The floor is now open for questions. Thank you very much, sir. We will now begin the question and answer session. Anyone who wishes to ask questions may press star and one on their touchtone telephone. If you wish to withdraw yourself from the question queue, you may press star and two. Participants are requested to use only handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. Ladies and gentlemen, in order to ensure that the management will be able to address questions from all participants in the conference, please limit your questions to two per participant. Should you have a follow-up question, please rejoin the queue. Thank you. We'll take the first question from the line of Dhruv Bajaj from SmartSync Investment Advisory Services. Please go ahead. Sir, firstly, congratulations on amazing set of results. Since I'm new to this business, so- Bajaj, your voice is muffled, sir. May we request you to use your handset, please? Is it fine now? Yes, sir. Much better. Please continue. Hello? Yes, sir. Please continue. Am I audible now? Yes, we can hear you. Yes, sir. Yes, sir, please continue. As the current participant has left the queue, we'll move on to the next question, which is from the line of Himanshu Bisani from Niveshaay. Please go ahead. Himanshu, yeah. Hello? ... Yes, sir, please go sir. Hi, yeah. Congratulations first for a good set of numbers. My first question would be some bookkeeping questions, like, what are the number of printers we sold in this quarter? What was the capacity utilization for this quarter? In the presentation you have mentioned that an increased market share, you know, from 18.5% -1 9%. So my question was, was this increase in market share led by the higher growth margin printers, like, for the, like, the laser and the new technology printers, or it was for the basic continuous or thermal printers? Himanshu, this is Shiva Kabra. I'm gonna answer this question. So essentially, all printers were sales in this quarter, you know, there's not a substantial change up of the mix. But what we've done is in the last year or so, you know, which has been having more of a gradual effect, is we've been, you know, focusing more on larger customers, where the per printer business is significantly higher. And the idea was to grow the sales overall in terms of number of printers, but especially to go for those customers who are going to give us significantly more business on a per printer basis. So we've been successful in changing the customer profile to some extent, but it's true that we have dropped some sales, but still, it's a work in progress because larger customers have a longer pipeline, although the number of printers sold are higher also. So maybe at the end of the year, we get a better read on whether we are actually having a slight decrease in sales as we focus more on the you know the A set of customers or you know whether we are actually slightly dropping sales as a result. But irrespective that because of our per printer business increase as a result of focusing on the cream, we are still better off. But yeah, definitely we would expect to increase the number of printer sales and increase the business per printer. That's our... That's the target, of course. Problem is the target is different from the actual results sometimes. Okay, and about printers we sold in this quarter? Yeah, hi, Himanshu. For this quarter, we've sold... Yeah, sorry. Himanshu, can you hear me? Yeah. Please continue. See, we sold about 75 printers in this quarter. Okay. And what was the number for the same quarter last year? It was 679. Okay. Capacity utilization? So, I mean, it must be running about 60% or something. So we bottleneck the factory quite extensively, but it's difficult to predict the capacity. There are times when, you know, there are not that many, you know, it can be sometimes slightly lumpy or something, and you can get three large orders in one go, sometimes it's really a steady type of stream, so you cannot look at overall capacity to look at, where we are able to hit the, meet the peak. But no, we have that capacity to be able to, you know, meet the peak. Like, if we sold 1,000 printers a quarter, we would be quite comfortable with our current setup. Okay, got it. On that, sir, the capacity, when we look at different types, SKUs of printers, does that change significantly when we are producing one type of printer or other? So we have different capacity set up for each type of printer. It's not like a mix, so the people who are making one type of printer normally not making other types of printers. So, like, in every area, we have that ability to scale up. And if we feel that the demand between printers is shifting on a more permanent basis, then we might shift people from one part of the factory to another part of the factory, if you get my point. So, you know- Okay. If someone is on a line to make the, I don't know, something like the, you know, the Suzuki Grand Vitara, and someone is on line to make the, I don't know, Alto or one of the other cars, you know? So if we feel that there's a permanent shift, we can shift someone from the Alto to the Grand Vitara line or something, but otherwise, we have a capacity for each thing and, and the labor associated and the thing with that, but we, we can shift if we need to. So the training is not a problem, it's just that there are different parts in our factory which are created for different products, and, you know, we, we have to reconfigure that thing out. Got it. Thank you so much, sir. I'll join back in the queue. Thank you. We'll take the next question from the line of Saket Kapoor from Kapoor & Co. Please go ahead. Yeah. Namaskar, Jagdish sir. Namaskar, Shiva Ji. Sir, if you could just reiterate the point which you were mentioning earlier about shifting of lines. I missed that part. I mean, what are you alluding to, sir, in terms of the type of printer we are doing, or is it subject to the consumables? Hello? I didn't completely understand your question, Saket Ji. Sir, yes, sir, I will repeat it. Sir, I was just referring to the point you made earlier, right now, to the participant regarding the shifting of lines. Mr. Kapoor, there is an airy disturbance which is coming along with your voice. May I request you to please use your- Am I... Hello? Yes, sir. This is much better. Please continue. Yeah, just give me a second. I'm coming to a more receivable area. Now you can hear me, sir? Sir, I was just listening to the point you made regarding the shifting of lines. What, what are you trying to allude to, sir? In terms of the type of printers we are making, or just a better understanding of what, what are you trying to convey, sir, by, by this? Yeah. So what my belief is, that Himanshu asked a question on the capacity at the factory. Yes, sir. I said that we have a capacity, which we will be operating somewhere between 60%-70%. Correct. Approximately, I believe we sold about 700 printers in the last quarter. So what I was saying was, we can sell even 1,000 printers with our current capacity and current setup. Then, I think Himanshu asked a second question, which was: What if, like, if this—like, do you have, like, a common capacity for all your printers, or do you have... So I said, "No, we don't have a common capacity, Himanshu. We have a separate setup, manufacturing setup, for each type of printer." And it is sort of fixed for that, but we can change people around if we feel that the demand for one printer is permanently increased or permanently decreased. So it's not like... Yeah. You know, if, if I have to make one type of printer in a higher quantity, I'll have to work that team over time if it goes beyond standard capacity. But if I feel like this is continuously there for two, three months, then what I will do is I will shift some people from underutilized parts of our factory to back those teams, because the skill set is quite common. So that is, I, I think it was more of a capacity question. It was not anything to do with- How should one read the capacity utilization levels for our consumable segment? You answered it for your machines, but how are the consumables currently stacked up? So the consumables also we are about, I feel like 60%, 65%. So whenever we come to a certain thing, like 70%, 80%, we just debottleneck. I mean, we don't announce it because these are like, you know, insignificant. We keep spending a few INR crores. That's why the overall, what is that, PPE or the plant property equipment or whatever, not gone down that much. But we keep debottlenecking as and when we need, because we are normally at somewhere between 60%-70%. We don't want to go beyond 70%, because like I said, sometimes we have that requirement, which comes in a burst. You know, because of the type of nature of our industry, we have to give printers, we have to give parts, we have to give service, we have to give fluids and consumables even at the peak capacity, because without that, the line cannot operate, you know. So, it's not... Yeah, that's what the thing is. We have been geared towards peak capacity, not just towards, you know- Uh, yes. Regular capacity. Shiva sir, Shiva sir, if you could give us or allude to the current business environment, I mean, in the key addressable market and the key industries where we are servicing, how are you seeing the demand lines and how are their CapEx being aligned so that new lines would start contributing going ahead? The key to our key customers, what are their CapEx plans, and how are we aligned to benefit from the same? So if you ask me, I think it's actually looking sort of positive, because, you know, there, there are two types of CapEx I would say in general that are there with our customers. One is, you know, people in the FMCG industry, people doing things like pipes, you know, certain other types of things, which are not very heavy CapEx, if you will, you know. So for Supreme to buy 10 extruders or for, you know, Unilever to add two bottling lines or, you know, someone else to add, like, for Emami to add, like, you know, two Navratna Oil lines, that's not big CapEx. Their main cost are more on marketing, distribution, other types of things, you know, maybe, in whatever. But, so that CapEx has honestly been quite consistent. If I look at over the last five, seven, 10-year period, these people are continuously increasing their sales. Of course, it goes a bit up and down, but if you see the paint companies, you know, these types of companies, they have a... For whatever reason, you know, they're able to grow relatively consistently is what I'd say. So they, like the dairy companies, like Amul, is always expanding. And whether they have a up year or a down year, their plan is always to increase capacity by some percentage. So that, those guys are very consistent. But what we, I feel is, like, the big CapEx and, like, the steel factories, the aluminum factories, you know, the big cement, you know, those types of big, you know, big budget, blockbuster-type CapExes, which sort of create a lot of capacity for all the industries down the line, you know, and ease up the supply chain, that's sort of improved. And I think that overall, I mean, I don't know how it is. Honestly, I've not discussed it in depth, but I feel like the overall infrastructure in India, you know, the power, the transport, the logistics, has become more competitive, or at least seems to be less of a hassle than what it used to be, if you ask me. I mean, I don't know about what the customers are thinking. I'm talking from my own experience. So, you know, like, you can fly anywhere to India, you can travel anywhere to India. The trains are there, the planes are there, the roads are there. Within the city, of course, it's difficult to debottleneck, you know, where the metros are taking place totally. But if you ask me, from an industrial perspective, it's much easier, you know, to manufacture, to scale up and do other things in India than what it used to be. Yes. So I think, yeah, like, I feel like, you know, people are doing, like, big housing projects again, you know, and, and those things, obviously, it could be a bullish thing, so I don't know. But, you know, those are the things that drive the CapEx for the next 10 years, because in the end, the pipe companies and the paint companies will sell that extra amount, depending on, you know, who, how many houses are being sold and so on and so forth, you know. But taking this into account, I mean, we have always seen that H2 generally shapes up because the economic activity for the country gathers momentum towards the festivity. So, in the likelihood of that getting traction, can we look at a three-figure top line for Q4 exit? Is that, is that going to be a good likelihood we are going there? We would definitely like to be positive about our business. But so far, as of H1, it's a very good state for us. I mean, if you look at the top line, it's about INR 165 crore on an annual basis. It is then, obviously, if everything goes on well, we get the right product mix, we get the right prices for our customers. Yeah, we would definitely achieve better numbers by March. So we are very positive about it. Yeah, sir, when last two points, when we look at the breakup of revenues, I mean, if you look at the standalone and the consolidated numbers- One moment, Mr. Kapoor. Ma'am, I'll join the queue. Yeah, I'll join the queue. Thank you, sir. A reminder to all the participants, anyone who wishes to ask questions may please press star and one. We'll take the next question from the line of Yash from Stallion Asset Management. Please go ahead. Hi, sir. Thank you for the opportunity. So, you know, I'm looking at your investor presentation, slide number 18. And there, you know, you've given a chart that over the five years, your gross margins have gone down from 68%- 60%. So that's like 800 basis points contraction. And I'm just trying to understand why this has happened. Can you elaborate on that? So I have to check the exact details, but there's no difference in our gross margins over the period of time or our net margins. So someone will have, I'll have to look into it in depth. I don't know which was the last year where we got some benefits, you know, from the Guwahati factory. And you know, that obviously increased our profitability for that year because we got some benefit, but I don't think it was that long ago. So it could have been that year, it might not have been that year. I don't know when the GST was introduced. Yeah. So it could be, it could be that, you know, when the GST was introduced that instantly got a benefit from our factory. Overall, you know, our gross margins haven't fundamentally changed, so it will be other expenses or other types of developments that we've undertaken that would change our gross margin because our pricing structure has remained constant. In COVID time, yes, it went up a couple of percent because, you know, we were buying a lot of stuff. 50%, and we were buying from the spot markets and, you know, at extortionate high prices, but we had no choice. But that's somewhat. I think it's quite normalized, if you ask me now. It's not completely normalized, but I'll say, like, the inventory, the supply chain is 90% back to normal at least. But yeah, and then we had some minor price increases to cover the cost of those, you know, whatever permanent price increases are being passed on to us over COVID and so on. So I don't see any fundamental change in our margins. But I'll... Someone will have to do a deep dive in that, but it's just a mix of which products we are selling versus what sort of margin we are doing in each product. But each product group by itself has a constant margin. I can say in financial year 2018, the CIJ was definitely a much higher percentage of the business than what it is now. But I'll have to deep dive into it. So I think there are two factors. One, that the CIJ was the highest percentage of our business at that point of time. I'm quite sure of that. The second could be that we were still getting some GST benefits, at that point of time, in that financial year, in Guwahati, and that gave us a, you know, that was actually quite profitable because that, that contributed straight to the bottom line. But- Okay. Fundamentally, in each product group, our margins remain consistent. In some groups, maybe we've invested because we need to build a certain market share because we started late. But you know, now everything is... We have enough references across each and every product group of ours. We don't need to do all that anymore. So it's just about performing. Got it. Got it. Okay. Thank you. Thank you. Participants who wish to ask questions may please press star and one. We'll take the next question from the line of Karan Bhatelia from Asian Markets Securities. Please go ahead. Mr. Bhatia, I've unmuted your line. Kindly proceed. Yeah, can you hear me now? Yeah, we can hear you. Yeah, yeah. Hi. Hi, how are you? Very well. Sir, can you break up the revenue in terms of, you know, printers, consumables, spares and others? In terms of percentage. Yeah. So printer revenue will be about 15%, consumables will be about 62%, revenue from spares and others will be about 7%, and the service component of income will be about 14%. Okay. And, how about masks? How are things? How How are we seeing that business now? Sorry, Karan, I missed out your line. Karan, can you repeat it? Yeah. So how about masks? How are we seeing that business? Yeah, masks, masks, I'll tell you what, we do not have a strong revenue to report as yet. I mean, as compared to the total revenue, it's just about 0.2%. But, we are, in fact, trying to revive the business because, the masks, as a, you know, like- ... The health reason, I mean, masks for health reason, that has actually come down. Rather, masks have been started being used as more of a hygiene thing. And so what we see is that there are some industries where we can actually, you know, cater to and tap the market over there. For example, the chemical industries belt, which is in the western part of India, mainly Gujarat. So we are trying to revise our marketing strategy in around that area to begin with. And so hopefully we'll try to, like, increase the, a percentage of masks revenue in the total total sales. Currently it is just 0.2% of the total revenue. Right. So also, sir, if you can help me, why is the depreciation lower? So have you fully capitalized the mask CapEx? No, it's, it's almost done. It's almost done, sir. Right. Right, right, right. Yeah. And also, Shiva sir mentioned about, you know, supply side challenges which you faced in last couple of quarters. So how do we see things shaping up there? See, I'll tell you what we have, we do is we have a risk-averse strategy. So the last thing we want to have it in our company is that we do not run out of stock. So apart from having a ML and bill of material-based procurement, we also try to, you know, guess the demand for our products, which would be in the coming months in, and then try to build up our stock. So we try to make sure that we are not out of, you know, inventory at any point in time, so that our production is not hampered. As of now, the problem that we used to have about chips has slowly eased out, and we do not foresee any problem unless, you know, like, say, some kind of, you know, like, major pandemic or, you know, some kind of a war breaks out. But as of now, I think the problems for chips that has been eased out as of for this quarter at least. Right. So, apart from chips, you know, all other conductors, dies, segments- Yeah. So when we... So entire electronics, yeah. So the, all the, all the, raw materials in that particular portfolio. Right. So, we are. And as such, we are very risk-averse, so, you know, we try to make sure that, you know, we do not run out of stock. Right. Right, right. Got right. Got it, got it. Thanks, thanks. I'll follow back in the queue then. Bye. Sure, sir. Thank you so much. Thank you. Yeah. A reminder to all the participants, kindly limit your questions to two per participant. Should you have a follow-up question, please rejoin the queue. Thank you. Yeah. We'll take the next question from the line of Vignesh Iyer from Sequent Investments. Please go ahead. Thank you, sir, for the opportunity. Two questions from my side. First one is, notification that came, end of July or start of August, as you say, for the bar codes for the top 300 machine. How has the traction been for us post that? And secondly, if you could just help me understand which sector do we have the highest market share when it comes to our business? Yeah, so looking at the pharmaceutical, 300 brands, we are actually executing, some projects in a few customers. I cannot give the names. But, yeah, some of those brands or some of those production lines are responsible to execute. As of right now, I can say that it's a smaller market share percentage because we entered the business later, so relatively, we have a smaller market share, but we are executing on that. And, we're still supposed to... Like, we are already printing, we're already live, but yeah, we still need to have some debugging, or some finalization of our installations, going on for that. So we're working on that opportunity, and, of course, it's a positive in that it expands the market, to that extent. The second question was, you know, regarding the market share by industry. Overall, I think we've given a broad breakup, that we are strong in industrials. I think that's approximately 65% of our business and 35% is in the packaging industry. Packaging would be food, which is the single biggest industry, beverage, pharmaceuticals, and personal care, home care, you know, and that type of thing. And in the industrial would be all your stuff like cable and wires, pipes, paints, lubricants, chemicals, steel, metals, and all those types of things, automotive components and whatnot, whatnot. Cement, fertilizers. Okay. Yeah, I mean, so sorry, just, same line, the industrial segment, I mean, you are saying the 65% market share, right? Yes. But... Oh, okay. Right. right. 65% of our sales. No, no. So my question, my question was: Which among the sector do you have the highest market share? So if 35% is the highest, which is Obviously, like, we've given a, like, our market study is that our three main competitors are 35%, 65%, so 35% industrial, 65% packaging. We are 65% industrial and 35% packaging, which gives a broad breakup that we are stronger in the industrial segments as compared to the packaging segments. So that's what the type of information we can give you, but in very specific industries, we don't actually disclose that level of information down for competitive reasons. Okay, sir. Okay, sir. I'll, I'll call back in case. Thank you. you. Thanks, thanks. Thank you. We'll take the next question from the line of Hiral Desai from Anived PMS. Please go ahead. ... Hello? Hello. Mr. Desai, I have unmuted your line. Kindly proceed. Hi, Shiva. Hi, Jaideep. A couple of questions I had. So if I look at the H1 revenue growth, we are at about 22%, versus the typical 9%-11% growth that we talk about for the industry. So just qualitatively wanted to know, you know, given that manufacturing has got a large fillip over last couple of years in India, are you seeing, you know, much more inquiries coming in, and is the demand environment much more sanguine versus the past? Yes. So actually, there was somebody who asked it earlier. I don't know if it was Saket or someone, but what I said is, you know, like I said, there's two sets of companies, or there are three sets of companies. There's small, SMEs, or you can call, lately, as part of our sales strategy, we've been refocusing on the SMEs and focusing more on the larger, mid to large size companies only, because... Not because of capacity or any other reason, it's just more of a capacity of service and, you know, the type of effort required to service the larger customers. We felt that the larger customers give us a more business on a per printer basis. We've just been focusing more on that segment. So the SMEs have a much more random purchase pattern, but it's a huge market in India, no doubt. The second segment is the corporates, and like I said, if I break them up into two parts, which was, you know, the guys in paints or, I don't know, lubricants or, you know, pipes, FMCG, personal care, they're always doing projects. So I think whether their capacity utilization goes up or down, they are growing at a sort of consistent pace. So I feel like that the demand in those segments is steady, and the number of printer sales, which is what we can control, is steady. Maybe we've seen some bounce back of the consumption per printer to normalized levels because of the end of COVID, and therefore, people are utilizing the machinery more. So it's their capacity utilization which has gone up on the line, which has increased the amount of business of per printer that we are getting as a result. The third type of CapEx is the big ticket CapEx, you know, which takes years to generate, you know, which is the type of thing that ArcelorMittal or, you know, somebody investing INR 20,000 crore, like NALCO, setting up something new. You know, those types of things that happen. And I think there's more announcements, but, you know, that's gonna take time to drive down. And what that does is it creates a lot of secondary business opportunities down the line, you know? So when someone has a huge tire factory that they put up or something, that creates a lot of opportunities down the line for us. But, you know, those types of guys, I don't know what, how they do their own CapEx and how they predict it, but, but obviously they're looking at stuff over a longer period of time because, you know, it's a heavy investment and, so, you know, like I said, you know, it's not my business, but I feel like it seems like there's more positivity out there from some of our larger customers in the metal space, in the rubber space, and so on, so on. Shiva, broadly from, you know, the customers that we target, what would be the broad breakup between, let's say, the smaller SMEs versus large corporates? Just in terms of the number of printers that have it, but we are more like... I'd say, like, I'm sure like at least 70%, 80%, 70% + of our business would be like mid to large corporates and like 80%, 78%. Got it. So it was a higher percentage of SMEs. It's been changing over the last one and a half years or something, because it's been stretching our sales and service teams. And, you know, we just feel like either we could expand the teams or we could, which is difficult for us to manage, frankly, there's a management bandwidth issue there. Or we could, with a similar number of people, try to focus more on the larger customers, which, yeah, it's, it's more profitable for us, relatively speaking, because, you know, even the small customer demands as much attention as the big customer, but the amount of business we get of the larger customer over a longer period of time is higher. Got it. Got it. Fair enough. And the other question was for Jaideep. This tax benefit that we have at Guwahati will be valid for how many years? So when do we actually move to a marginal tax rate for the year as a whole? Yeah. The benefits would end in May 2025. May 2025. Correct. And then, yeah, so post that there'll be no benefits in terms of tax rate. No. So you'll actually- Yeah, for the Guwahati, yeah, correct. For financial year 2025, 2026, it will be back to the normal rate. Got it. Perfect. Perfect. Yeah. Thanks a ton, Shiva and Jaideep. All the best. Sure. Thanks, bye. Thank you. We'll take the next question from the line of Himanshu Bisani from Niveshaay. Please go ahead. Yeah, thank you for the opportunity again. So in the last interaction, in the last conference call, you mentioned that we are working on, you know, technology of Markprint to come up with a niche product for Indian markets. Do you have an update on that yet? Yeah. So, so we're still working with them, and we, we have started selling some products of theirs out here. I mean, we've already started marketing it, without quite selling it that much, although the. We, we should actually have the first installation maybe coming up in January, although that's been, built and sold directly by them. But, yeah, it's, it's, it's something that obviously we're, we're developing, and we're working upon. But, you know, like, these are all, like I said, the standalone business which you see is, is the main business, and then all the consolidated stuff is like businesses which will contribute, but not like now, you know, like maybe later down the line. Of course, that's where the risk is, because those all bus- we still have to prove ourselves, we still have to perform. But yeah, of course, we're definitely working on development of those products. It's going on. And yeah, like, we all figure out that, you know, some things cost quite a bit of money if you, if you get everything from the Netherlands, and then some stuff, if you do the other development, is more challenging than we expect because it has to work, you know, a 100% reliable. We can't have. We don't have those types of things where we can keep engineers left, right, and center on locations and stuff, so. And our customers, you know, expect that type of reliability and performance from us. Got it. Got it. And sir, on the pharma track and trace technology, do we have an update on, you know, legal requirement? Because it's been like four months that, you know, we are expecting some legal requirements on getting finalized. Do we have update on that yet? Yeah, I think the government has mandated that the top 300 brands have to comply with this requirement. Like I said, we've got part of that business for some brands, all those top 300 brands with us. It is still a smaller percentage of the market share, no doubt, of the overall market, because we are later in this, so we have less references, we have to prove ourselves. And we also want to execute well before we go to, every single customer of the market. But the government has started with the top 300 brands, and I'm quite sure of the exact date was supposed to start by first September. I don't know if they got an extension. I can't tell you that offhand, but I know that this government has not given any major extension or any relaxation of the norms beyond one point. So I think all those brands have to comply with the government regulation, or maybe they've just got a few months to do this at most. Okay. Thank you so much. 300 brands, I don't know how it's defined by the government, but, you know, someone would have to, someone have to look at it right. I think it's in terms of, you know, revenue or something. Got it. Got it. Thank you so much, sir, and all the best. Thank you. The next question is from the line of Vignesh Iyer from Sequent Investments. Please go ahead. Hello, sir. Continuing with our earlier discussion on the pharmaceutical side of it, top 300 medicines that have been, you know, notified, can you let me know what is like the market size for this business could be? Or if a lot of these medicines are already, you know, not mandated, even, they were already doing it, I mean, had a barcode for themselves. I mean, just to get an understanding if the entire 300 medicine comes under, you know, as a business for us, or it is, for you know, just to get an idea. So I didn't completely understand, but what I can say is that obviously it depends from line to line in this type of thing. Then it depends on how whether the brand is a higher volume type of a product or is it a higher value type of a product. So so some brands can be in the 300, top 300 brands because the value of the product is relatively high, so maybe they just have one production line. So normally, on a per production line basis, you know, if you implement the primary and secondary as a third, like, I can't say offhand, it can be anywhere between INR 25-INR 45 lakhs. It really depends on your line. That's the approximate ballpark range of installation on one line. How many brands have how many production lines and, and so on, you know, that's something that literally depends on, you know, whether you... How you pro- packing your products. If someone is packing something like a Dolo, it's a relatively cheap product. It could still be in the 300 brands, but they might have many production lines of it. Whereas someone might be making something like some type of, I don't know, insulin or whatever, and they might have one production line. You know, so offhand, I cannot tell you, but obviously the... A big part of it is like, you know, there are a lot of one-time components to the sale, like vision systems, ejection systems, conveyors, you know, some integration, some other types of hardware and stuff like that. So what you're buying is, you're buying a sort of line solution, you're not buying just a printer. So the printer is just one part of that production line. Right. Of course, the software which controls everything. So the... Yeah, the revenue is higher. The aftermarket revenue cannot be compared because, you know, if you see, if you see INR 1 crore billing in that, where we sold, like, 50 printers, you get a, you know, like INR 75 lakhs of, seventy-five lakhs of aftermarket business every year. But obviously, out here, you won't get that type of billing because you maybe only sold, like, five printers in the entire thing, and you'll get some AMC from maintenance of the software and solutions. So the business per printer per year will be, or the overall repeat business of that will be significantly lower, although still substantial. So, again, like I said, I cannot say because it really depends on how many lines, you know, whether people are only implementing on the secondary, which is what we're seeing mainly, which is on the glue cartons, and are they gonna implement on the primaries? Are they gonna do other things? So, you know, depending on that, you can predict, like, how much it's gonna cost and what sort of size the market is gonna be. Oh, right. Right. Got it. So also on the overall market, size of it, if I'm not wrong, it is roughly around INR 1,800 crore or INR 2,000 crore. So how, what is, what is your internal estimate of how the total market is growing for the next couple of years, maybe? Yeah, so broadly, to reiterate, you know, last year we did, I think, about INR 291 crore in standalone sales. The market was, in our estimation, about between INR 1,750 crore-INR 1,800 crore, out of which the big four were somewhere between, you know, INR 1,350 crore-INR 1,400 crore. That is us, plus Domino, which we get in the market in March. We're expecting that, you know, we've seen that over a longer term, the market is growing between, like, 10%-12%. Consuming India is growing at, like, between 5.5%, 5%-7%. That's also what the market growth rate is. So maybe this year, I think that, you know, maybe the market will grow 10%-12%, so maybe it'll be close to INR 2,000 crore this year, something, something between INR 1,950 crore-INR 2,000 crore. And, you know, obviously, our market share depends on how much we sell. And the standalone numbers should be looked at, is my personal view, because that shows what we're doing in our core coding and marking business and what we're doing on a consolidated business, as, you know, like, it's not this INR 2,000 crore market. It's other things, you know. Right. Mm. So, obviously, I cannot say offhand because, you know, we get these figures at the end of the year, and, you know, there's honestly no point, like, fantasizing about market share and doing all that other stuff, because what's more important is we focus on executing. So at the end of the year, we'll, you know, because our competitors are private companies, we obviously get some information from the market, but, you know, in the end, those things are not accurate. So it's better to always wait for, you know, their internal numbers to be sort of announced or published, or, you know, wait for the ROC data. So, yeah. That's what it is. If I could just squeeze one more in, just to understand, the reason for that was because we have a target of consolidated revenue of INR 400 crore by 2025. I understand it's consolidated, but even if I have to take it on a standalone number, it would be fair to say that we would be growing, I mean, faster than the market is. So, so, it has to end up in such a way where we would be gaining market share? Well, I think the board has set us a standalone target only for the coding and marking business to, you know, from what I remember, you know, what we've said. So what we do on a consolidated basis is not their concern. But like I said, you know, it's obviously, these are the targets, and, you know, it depends on multiple factors, and in the end, we have to execute well. So everyone wants to grow market share, you know, but the point is, that who's gonna be successful depends on, you know, how well they're actually running their business, how satisfied their customers are, and so on. Like, we've been very clear that we've got a strong product portfolio, but we're not some sort of discount players, you know, and I reiterated earlier in this thing, that we are actually struggling to service all the SMEs because it's putting stress on our service networks and, you know, our sales networks, and we don't, we're finding it difficult to manage that many extra people. So, obviously, you can see, like, you know, overall, it seems like it's all coming down to the execution, and, yeah, that's, that's all we're trying to see because... So definitely we wanna, you know, the target is to hit 400, you know, and maybe the market might grow another 10%-12%, you know, from whatever it is, from 1,750, and, you know, or 1,800, you can roll it out over the years. So we should have some market share gains, but, you know, these are all, like I said, in the end, what matters is what you actually execute, right? Because, but it is standalone numbers, and of course, the consolidated numbers are difficult to predict, because these are, like, recent businesses. They're small businesses, you know, they're still in the very early stages. So out there, it's just about growth and, you know, honestly, till they're not, like, INR 50 crore, INR 80 crore, INR 100 crore in size, we feel like there's no point to be discussing those businesses, is my view, if, if they get to those sizes. Right. Right. Thank you for your in detail reply and for all the best for the firm. Yeah, thanks. Thank you. We'll take the next question from the line of Karan Bhatelia from Asian Markets Securities. Please go ahead. Yeah, so some problem out here. So, what type of price negotiations with our client in the couple of months? So, are we done with that, or we still to see the real benefit of that? So no, I mean, your question is still unclear. I mean, I couldn't hear much of it. Sir, with respect to the price negotiations, we were signed with a couple of our clients daily, so, are we... Have we started to see the benefits or a few more quarters of that? Karan, we've done most of the negotiation and most of the customers have given us an increase. It was gradual, but I think largely almost all customers have, that price has been executed almost across the board, I'd say, over the last 12-15 months. Okay. Okay. So, yeah, and- Got you. that sort of covered, I think, all the COVID cost increase, so it should be stable, but yeah, I, I don't think there's anything lined up, as of- Okay. now at least. Okay. Right. Right. And despite of a double-digit growth in the consumables sales in this quarter on a YoY basis, still our gross margins have seen some decline. So just wanted to have your thoughts on that. That's it. Yes. Actually, what happens is that it actually is a mixture of the product mix, and, first of all, it's between consumables and the printers. And within the printer also, we've got about five or six different types of printers. ... So, so long as our profit is, you know, increasing, we are not too much into it, right? Okay. Okay. I think that was helpful. We'll have, we'll just pocket for one follow-up, and then we can close the call. Thank you. Okay. Thank you. Thank you. Yeah. Take the next question from the line of Saket Kapoor from Kapoor & Co. Please go ahead. Yeah. Thank you, sir, for this opportunity. But as Shiva said, you were mentioning about to look into these standalone numbers, as the core operational numbers of the coding and marking segment. So, how should one look at our investments that we have done currently in Innovative, Control Print B.V., the Markprint and all? How are they going to yield the results that are the desired results going there? When are we going to reap the benefit of it, and where are we in terms of the stage where the investments are currently? I think so far, Markprint B.V., we have some milestone been there so that we'll be buying the remaining stake from the erstwhile promoter. So if you could give us some more color on the same. Yeah. So as far as Markprint B.V., because we've made a minor stake increase there, you know, and what—like I said, it's, you know, Saket Ji, these are... So, so coding and marking, like, like I said, and just giving it, because it's very difficult to understand on a narrow basis. Like we said, coding and marking was an INR 1,750 crore-INR 1,800 crore market in the previous financial year. Maybe this will be about INR 1,950-INR 2,000, whatever it is. So there's a certain size of market, you know, even if, you know, we hit INR 400 crore and the market is INR 2,200 crore- INR 2,300 crore, you know, like, the market is a certain size, right? It would not be like even Domino's, only like 23%-24% market share. So going beyond that market share is going to be difficult, you know, especially since we are finding it difficult to manage millions of people and, you know, and, you know, like, we don't want to increase that beyond the point, because we're finding, struggling to manage it without losing the service quality and the product. So, like, those things are there. And at the same time, you know, we are... Yeah, I mean, so I think that what I said is exact. Basically, there is a sort of runway or whatever you know, which I think what is the runway to grow, which is all the marketing term that I think all the investment people use, and that's like basically 10%-12% a year. So that's the thing that's there. So we can increase our market share and ramp up growth, but in the end, you know, where the market grows is where we can grow a, a few percentage points faster year-on-year, which is good, and it's a good business, it's a profitable business. Now, we had three or four adjacencies where we felt that we can have a strong market. One is in the packaging sector, which we're part of, although it's listed in IT hardware, by the way, I just found out today on Moneycontrol. For some reason, someone can correct that, why we listed on IT hardware. That's a separate thing, I don't want to get into that. But we're the part of the packaging industry. Then, you know, so we started the V-Shapes business, and that was something that we looked at, and looking at some more things that we can do with the packaging industry. Then, of course, we are part of the digital printing industry, coding and marking being one of the smaller parts of the digital printing industry. And we felt, we believe that there is a market, and we know that this market is being served by people like Markprint. That's a growing market that's there, where a lot of customers have a requirement to print additional information on the production line itself. Like, I'm differentiating between digital printing presses, which are done offline and done by your printer, you know, at their press. So this would be done by someone like Supreme Films or something like that, who print some film digitally, you know, some laminate, some flexible films and supply that, versus someone who wants to do it on the production line with more limited amount of information. So, the Markprint acquisition was focused more on that thing. And, you know, like I said, it's, it's been more challenging to, maybe because of COVID, maybe because of whatever, I won't say that I... Maybe because, you know, we are sort of hands full, and we overestimated, you know, what we could do, and how fast we could do it. The optimism was higher in a lot of cases than, you know, the reality. And to, you know, to use that to help drive that business faster. And the third area was, of course, the track and trace, which was well connected. You know, the track and trace, the software, part of the business, which is well connected with also our existing printer and business, and in fact, a requirement of especially the pharmaceutical industry, and maybe one, two other types of industries also, where it's, government mandated or the industry is finding some benefit in it. So all three of these businesses are basically to increase the target market size, because right now we're playing in a market of INR 1,800 crore, 1,750 crore, 1,800 crore, you know, it'll be INR 2,000 crore. So the idea was that, okay, we've got a strong team, we've got a strong setup, you know, and can we, look at developing, space in these other markets? So my view is that, you know, any of these individual business come to like INR 50 crore, INR 60 crore, INR 100 crore, there's no point discussing them because they should be at least, each individual, at least 10% of our standalone revenue for it to be discussed. You know, till that point of time, we don't have any aim for them in terms of profitability or other things. Of course, they have to maintain their gross margins because... But in the end, we don't mind if they lose money or they invest more in R&D, they invest more in other types of capacity building, but the idea is more to grow the business, you know. Get to a semi-decent size and, where, you know, where the economies of scale will sort of start kicking in. And because of the sort of financial position that we are in, we can afford to be patient and invest in those businesses, fortunately. So I think, I mean, you know, these are like all new businesses and, you know, nobody can predict how it's going to work. There is always a risk that none of them will work, you know. We still have chosen carefully, but, you know, in the end, the reality is going to be found out by how we perform. So, right, nobody can say. You know what I mean? JSW has got in the paints business. Some people will view it as going up against Asian Paints and Berger Paints. Some people feel, okay, they have a good distribution and, you know, they can be successful in that business. So, you know, I cannot say what's gonna happen, you know, because in the end, this is like that type of scenario where there's question marks, you know, and so I think we just have to be patient for maybe at least one and a half years more and see where we are. Maybe to review in March 2025, something like that. Right. Last point was, sir, I think, it was a very successful buyback issue for the non-promoter shareholders. However, due to some technical issues or what was highlighted, the promoters could not participate in the issue. And also, so that was the impact, I think, so that the sad part of the story that the promoter could not get their share. So when we look at the current numbers and the equity instrument through FVTOCI, the contribution for the last two quarters have been significant. I mean, for the first time, it is around closer to INR 25 crore. So post this buyback, what is our current exposure to the equity market, sir? Jaideep sir, can you give any ballpark number? We monitor our investment levels very closely, and in fact, we also take the approvals of the board as well. The mark-to-market, the MTM, security holding would be about INR 52 crore in equity. Sir, the participant has left the queue. ... Hello? Ladies and gentlemen. Yes, sir. Yeah. Is Saket still there on the call? Sir, he has left the queue, and that was the last question. Yeah, he had asked the question about, you know, the equity investments, what we have. I think I should be able to answer for that. Sure, sir, you can go ahead. Yeah. So the cost of the investments, you know, like, is just about INR 42 crore as of 30th of September. Thank you, sir. Yeah. Thank you. Ladies and gentlemen, that was the last question for today. I would now like to hand the conference over to the management for closing comments. Over to you, sir. Yes, this is Shiva Kabra. First, I want to thank everyone for participating. I know it's a busy period, and, you know, happy Diwali and festive season to everyone in advance. Thanks to Karan and the AMSEC team for organizing this. I really appreciate it. And, you know, we just want to reiterate that it was steady for us this quarter. Those growth initiatives are there, but it will take some time for us to see those results. And, you know, we'll keep you posted sometime in the beginning of January with our next quarterly result. And if anyone needs to reach out, please feel free to contact Jaideep Barve for any details that is required by anyone. Thank you. Thank you, members of the management. Ladies and gentlemen, on behalf of Asian Markets Securities Limited, that concludes this conference. We thank you for joining us, and you may now disconnect your lines. Thank you. Yeah, thank you so much. Bye. Thank you, sir.