Ladies and gentlemen, good day and welcome to the Alicon Castalloy Limited's earnings conference call. As a reminder, all participants 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 0 on your touch-tone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Mayank Vaswani from CDR India. Thank you, and over to you, Mr. Vaswani. Thank you, Michelle. Good day everyone, and thank you for joining us on Alicon Castalloy Limited's Q3 FY 2024 earnings call. We have with us on the call today Mr. Vimal Gupta, Group CFO, Mr. Shyam Agarwal, Chief Marketing Officer, Mr. Andreas Heim, Managing Director of Illichmann Castalloy, and Mr. Rajiv Gupta, Head of Domestic Business of Alicon Castalloy Limited. Mr. Vimal Gupta will cover the financial performance for the quarter, following which Mr. Agarwal will walk us through the operating highlights. Mr. Andreas Heim and Mr. Rajiv Gupta will then provide insights on global and domestic markets, respectively. Thereafter, we shall open the call for the Q&A session. Before we begin, I would like to point out that some of the statements made in today's call may be forward-looking in nature and a disclaimer to this effect that have been shared with all of you earlier. I would now like to turn the call over to Mr. Vimal Gupta for his opening remarks. Thank you, and over to you, sir. Good morning to all our investors. Thank you for taking the time out to join our earnings call. I trust that all of you have had a chance to review our earnings documents, which were shared over the weekend. We are delighted to report our highest-ever revenue this quarter. As we have shared earlier, in recent years, there has been a strategic emphasis on serving new technology platforms in the auto industry, expansion into new geographies, the addition of capabilities, and renewed focus on value engineering. This has enabled us to surpass the milestone of INR 400 crore in revenue during a quarter for the first time ever, and we believe this is a positive sign of things to come. Our business transformation strategy is guided by five pillars, reflecting our commitment to diversify and solidify our growth towards enabling sustainable progress: scaling strategic products in the ICE business, addressing opportunities in carbon-neutral technology, including battery electric vehicles, hybrid electric vehicles, fuel cell, and hydrogen cell technologies. Exploring opportunities from structural parts or technology-agnostic components. Expanding into non-auto business, leveraging our competencies in sectors such as defense, energy, and telecom. Enhancing customer wallet share through value-added products and comprehensive solutions. Investors should closely track the following key themes that underscore Alicon's business transformation for insights into our progress and evolving business model. The first is we continue to increase the share of passenger vehicles, the commercial vehicles, CV, in our product mix. This has reached 51% in nine months for the financial year 2024 compared to 48% in nine months of financial year 2023. Secondly, our customer profile is evolving with the addition of prestigious global names, including leading global OEMs and Tier 1 companies, highlighting Alicon's growing stature in the industry. Currently, our business composition is shifting towards expertise in design, research and development, and value engineering. Alicon now distinguishes itself by winning businesses based on innovation, technology, and design, positioning us as a solution provider rather than just a source of low-cost components. As we continue to adapt and innovate, these themes serve as key indicators for investors to assess our ongoing transformation and strategic directions. Now, turning to the financial performance for the quarter under review. In quarter three for financial year 2024, total income reached INR 406 crores. That is a 12% increase compared to INR 362 crores in quarter three of FY 2023. When we compare with the total income of INR 382 crores in quarter two, this indicates sequential quarter growth of 6%. Revenue growth has been driven by scaling up the production for the new parts and new logos added recently, including many critical parts being supplied to market customers. As a result, we have witnessed an increase in utilization level, especially as a European facility. Total capacity utilization, which was 68%-70% quarter two, has moved to 70%-71% Q3. The gross margin for the quarter was 51.2% in Q3 2024 compared to 49.2% in Q3 of financial year 2023, higher by 198 basis points on a year-on-year basis. This is primarily due to a more favorable product mix accompanied by a positive impact of stabilizing the alloy prices at lower levels. There has been a sharp rise in employee cost, which has been higher by 15% on a year-on-year basis. Apart from the differences due to increments, there is an impact of ESOP cost of around INR 3.7 crores for the quarter and INR 10.7 crores for the 9-month period, which is a non-cash charge. Shifting to our focus on profitability, EBITDA for quarter three is INR 53 crores, a notable increase from INR 42 crores in the same quarter of the last year, so an increase of 26.2% on a year-on-year basis. Despite a significant rise in employee cost, the EBITDA margin for quarter three for financial year 2024 has improved to 13.1% in comparison to 11.7% in quarter three of financial year 2023. I am pleased to share that we have reported an improvement in the EBITDA margin by 136 basis points on a year-on-year basis and by nearly 74 basis points on a quarter-on-quarter basis. Importantly, if we adjust the non-cash charge for the ESOP cost, the adjusted EBITDA margin is 13.3% this quarter. This is an increase of over 180 basis points on a year-on-year basis. Some of you would recall our prior earnings call, where we had indicated that we will increase the EBITDA margin by 100 basis points in FY 2024. We have already achieved that in the first nine months itself and intend to build on this further. We continue to remain confident about the general upward direction in margin given the improving product mix. Finance cost was higher by 24% on a year-on-year basis from INR 8 crores to INR 10 crores, in line with the higher interest rates. We also witnessed an increase in depreciation, which was higher by 24% on a year-on-year basis from INR 16 crores in quarter three last year to INR 20 crores in the quarter three of financial year 2024. The increase in depreciation has been driven by two factors. One was when we have taken some machines on lease, and for the accounting standards, we have to factor a maximum useful life of five years, which is resulted in a higher depreciation cost. Secondly, we reevaluated and shortened the useful life of some other assets, which has also contributed to the increase in depreciation. As a result of higher finance cost and depreciation, profit after tax for quarter three 2024 is INR 17 crores as compared to INR 16 crores in quarter three of financial year 2023, higher by 5% year-on-year basis on a sequential quarter. Profit after tax was higher by 15% from INR 15 crores to INR 17 crores. For the 9-month ending December 2023, revenue was INR 1,142 crores against INR 1,084 crores in the corresponding period last year, growing by 5%. The gross margin during the nine months of financial year 2024 stood at 50.6% against compared to 48.5% in the nine months of financial year 2023. EBITDA for the nine months of financial year 2024 stood at INR 140 crores against INR 124 crores in nine months of financial year 2023, higher by 13% year-on-year basis. Profit after tax nine months for financial year 2024 stood at INR 41 crores against INR 42 crores in nine months of the last year. In terms of CapEx, we spent around INR 84 crores during the 9-month period, which is in line with our target CapEx deployment of around INR 90 crores in financial year 2024. Coming to the outlook, as we have indicated in the prior quarter, the second half of the year will see an improvement in the revenue, given the healthy pipeline of SOP from new products and new customers. While we had delivered year-on-year revenue growth of 2% in the first half, after the strong third quarter, the year-on-year revenue growth for the 9-month period has increased to 5%. Given the noted base of the fourth quarter last year, the strong momentum in current performance, we continue to believe that we will end financial year 2024 with a revenue growth of 13%-14% for the full year. Thereafter, we are poised to take the business to a new height as we aim to deliver a revenue of over INR 2,200 crores by 2026. So this equates to a CAGR of over 16% over a period of three years. Our confidence stems from the new orders which we have received and the discussions with the customers of new technologies and solutions. If we look into our track record with the customers, including some market global names, you will notice that these customers initiated the relationship with one or two parts. They monitor our approach and carefully observe the QCDD parameters on the quality, cost, timeliness, and completeness of the delivery and gauge our overall development capabilities. Once they are confident about the comprehensive approach towards these initial parts, they proceed to expand the scope of the business relationship to offer more critical parts with a higher value addition. We are now past the stage of development of initial products with Daimler, JLR, Toyota, Stellantis, and Maruti Suzuki. The initial products are already into or will shortly commence SOP. Having earned their trust and confidence, we are now in active discussion on additional parts jointly working on solutions and seeking value addition. This will help us scale up relationships with each of these global customers and position us to win a larger share of the business from each of them. As we scale up volume and consequently revenue, we expect this will be accompanied by an improved margin profile. We have talked about aspiring to take the EBITDA margin to around 14%. In quarter three of FY 2024, the reported EBITDA margin of 31.1%, addressing the one-time expense of ESOP cost, which is a non-cash charge, brings the adjusted margin to 14%. We are looking to drive efficiencies across the balance sheet and working capital, which will contribute towards enhanced return ratios too. On that note, I would like to hand over to Mr. Shyam Agarwal, who will talk about operating highlights of the business. Thank you, Vimalji. Greetings to all of you. We have strategically enhanced the performance in each quarter of this financial year, and the initiatives to strengthen and grow the business have helped us to boost our best-ever quarterly revenue. In addition to strong double-digit growth in revenue, we have witnessed improvement in margin. Further, the outlook remains promising with steady ascension to the order backlog. Overall, it has been a solid quarter with progress demonstrated across all key parameters. Coming to some of the key business programs this quarter, for Toyota, where we supply cylinder head to their hybrid model, we have witnessed ramp-up in volume during the quarter, and our production is running in full swing to meet the increased demand. Toyota is coming up with their third plant in India. They have already signed a MOU with the Government of Karnataka for setting up the plant near Bidadi at Bengaluru. This will provide them incremental production capacity of about 1,000,000 vehicles per annum. As we are an approved supplier, we will aim to capitalize on the opportunity to increase volume with this enhanced capacity. In quarter three, we commenced supply of cylinder head to Stellantis, India, which is for domestic markets and will also be assembled and exported to Europe. Stellantis is seeking to create an engine manufacturing hub in Hosur, in India, and Alicon is the single-source supplier of cylinder head for those engines. During the first quarter, volume has picked up, and it will further increase in quarter four and onwards. With this business, Alicon has developed a model plant involving cutting-edge technology and automation for this product, which will add in the development of the product. This will also serve as a demonstration plant to other global customers of the capabilities and the global standards they can expect when partnering with Alicon. As anticipated, supplies of cylinder head to Maruti Suzuki scaled further during the quarter. The sales and production will increase further in quarter four with the start of supplies to Gujarat plant to Suzuki. In addition to this, one more cylinder head supply will come in from quarter four. The volume of both cylinder heads combined will provide significant volume increase in financial year 2025 from Maruti Suzuki. We expect better levels of activities in quarter four and into the next financial year. Given the visibility provided by the commencement of supplies for these parts, expected increase in volume for active parts and SOPs for few parts under development, all of which will contribute to enhanced revenue momentum. The other aspect of highlights is improving product mix. Alongside the increasing share of products for ICE being supplied to passenger vehicles and commercial vehicles, is the increasing share of business catering to the EV and carbon neutral segments. The share of business from EV is into double digits at 11% for nine months of financial year 2024, as has nearly doubled from 6% share in the nine-month period last year. We expect product mix to be further enriched as all of the new business that we have won this quarter is for supplying parts for four-wheelers and to global customers, which is aligned to our strategy of focusing on higher value parts. Moving beyond the lever of product mix and customer sets, we have also implemented initiatives aimed at providing operational excellence and elevating our competitiveness. We have enhanced the machining capability and the capacity at Shikrapur facilities with the installation of advanced equipment. Enriching the competencies will add in enhancing customer wallet share and while raising the proportion of value addition. Further, we have added a machine of larger size, which can manufacture parts up to two meters in length, enhancing the capability of the European operation. We have also augmented our team by adding personnel with rich experience in project engineering, toolmaking, and single components to add their know-how to our operation. To this end, we are also actively recruiting experts in casting and machining, strengthening our global team. To further sharpen manufacturing prowess and process expertise, we are proactively deploying digital process control. This involves incorporating machine intelligence to add an extra layer of supervision to our production process, ensuring elevated precision and efficiency. The implementation of these controls will not only empower us with real-time data but will also play a pivotal role in actively managing operations and furnishing valuable insights for informed decision-making moving forward. In the area of cost competitiveness, our efforts toward diversifying the energy mix are bearing fruit. As we have shared earlier, solar panels have been installed on the rooftop of our plants in India and in Europe. Further, we have acquired share in solar installation and initiated a solar power agreement of 5.2 megawatts, which will enable us to achieve equivalent credit for the units which are fed into national grids. This will be operational in August 2024, and units fed into the grid will address against the units we consume at our manufacturing plant. With this initiative, the percentage of solar in our energy mix will cross 50%. These factors are serving to enhance the differentiation of Alicon in the global marketplace. In addition, our USP of being able to serve our customers both in India as well as from our plant in Europe. The simultaneous presence in domestic and international locations helps serve as a key differentiator and prove advantageous in negotiations with global customers. On this note, I would like now to hand over to Mr. Andreas Heim, who will cover the development in the international business for the quarter. Andreas, what are you? Sir, Andreas Sir is connected. Andreas, now you can take over. Yes, thank you. Yes, thank you. Thank you, Shyam. Good afternoon, everyone. The international business has delivered a strong performance. We scaled up by customers and improved visibility of performance due to the increased pace of additions. One of the key developments was the approval of the prototype of the E-Axle for JLR, with schedule for commencement of supplies along being concluded. During quarter three, we commenced the initial proto supplies of this E-Axle housing. Further, we've seen an increase in the volume by three times in the proto business. A couple of important perspectives to share about the JLR order. Given the capability of the order and the stature of the customers as a leading manufacturing, we extend ourselves in order to win the business. We involve partners from Europe for mold-making, part development, and machining to ensure that we de-risk the project. We were very keen to ensure the specifications we need, that we got it right the first time, and to shorten the lead time for the customer. The degree of involvement extended by us was highly appreciated by JLR, and their teams significantly improved the engagement and coordination at the development stage, which was a key factor in achieving the degree of success that we are sharing with you all of today. JLR has recognized that Alicon is not merely offering a product, but it's equally invested in offering solutions. Secondly, we have a highly diversified product range, which allows the customers to view us as a single-source supplier. Customers realize that they can produce their requirements for ICE, hybrid, and EV vehicles from a single supplier, and hence, they do seek out one-stop solutions. During the quarter, we also won an order from Oberaigner. This is for an electric drive unit or EDU, which Oberaigner requires for developing all-wheel drives for light commercial vehicles. This will result in a world supply to the prominent LCV manufacturers in Europe, such as Daimler and Volkswagen. Other prominent customers, such as Dana, Danfoss, TACO, and Mahle, which we have started with small projects and now in discussions to add more sustainable business. We anticipate better growth from these global names in the coming years. In addition to direct supplies to OEMs, we were equally engaged with Tier 1 suppliers, where we provide solutions. As we continue to observe strong growth potentials for several Tier 1 suppliers in their chosen niches, we believe they will bear a cascading effect on Alicon for supply of products. With this development, the global business contributed to 28% of the total revenue during the quarter and 23% during the nine months compared to 20% in quarter two and 21% in the six-month period, indicating accretion in international business in a single quarter. The share of international business can improve further as during the quarter, we added 30 new parts from core customers. This includes two parts from EV or carbon neutral and 11 parts from ICE. All 13 parts then train for international business. In carbon neutral business, we added another part from Scania for the European market, and we have also added one part from Danfoss. In the ICE segment, we further added eight new parts from Daimler Europe and three parts from Oberaigner. In terms of operating landscape, we see normalcy returning in Europe. Electricity and gas prices are stable, and availability has also improved. In terms of raw materials, aluminum prices have been less volatile than in the past. For diversifying our energy mix, we install solar panels on the rooftop of the manufacturing facility, and these have been running live since January, enabling us to reduce energy costs and enhance our sustainable footprint. With that, I will hand over the call now to Mr. Rajiv Gupta, who will take you through developments in the domestic business. Thank you, Andreas. Good day, everyone. In quarter three, FY 2024 auto dispatches, the industry showed an improved performance, especially the two-wheeler segment, which witnessed healthy double-digit YOY growth. This includes 5% growth in passenger vehicle segment on a year-on-year basis, 6% growth in the commercial vehicle segment on a YOY basis, and 19% growth in two-wheeler segment on a YOY basis. Within the passenger segment, there is clearly dominance of UVs with both customer interest and market share steadily rising. Other categories within PV segments still face mixed demand. The domestic commercial vehicle industry volumes continued to do well, and there was an increase of 6% YOY in the segment despite seasonality on account of good momentum in the infrastructure and construction segment, as well as steady growth in economic activity as indicated by GST collections. The domestic two-wheeler industry was expected to benefit from higher volumes on account of festive season, while there has been improved momentum, and this quarter last year was impacted due to a drop in demand on account of OBD regulations. Further, we believe the electric two-wheeler players are yet to regain lost ground. However, there are signs of stabilization there, and impending launch of new models is likely to kickstart the demand cycle. Compared to this, at Alicon, we saw the following trends: 31% growth in sales to passenger vehicle segment on a YOY basis, 9% growth in sales to commercial segment on a YOY basis, and 8% growth in sales to two-wheeler segment on a YOY basis. In terms of new business, we commenced the supply of one cylinder heads to Maruti Suzuki. We are also working on development of one more cylinder head, which is for an SUV platform. As the demand of SUVs in robust market share continues to rise, we expect this product to provide significant volumes once it enters production phase. From Daimler, we added new business comprising a large package with commitment for long-term supplies. The product that we have added envisions supplies commencing from 2026 with expected delivery up to 2020-2035. With the increasing engagement, we are in discussion for further businesses and to offer further solutions in upcoming models. Even the two-wheeler customers such as Honda, Hero, and Royal Enfield are projecting a strong set of numbers for the coming quarters, which will help Alicon to gain more volume of business. We also see some revival in momentum in the non-auto with the increasing spend of the government infrastructure and defense and the renewed rigor of the Make in India campaign. As you may be aware, for the last several years, we have been supplying aluminum wheels to enable light weighting of battle tanks. With a healthy level of demand witnessing for our products catering to the defense sector, we are now in discussion on a new tender in this quarter for supplies of products comprising road wheels as well as cylinder heads, which is to be commenced on an immediate basis. Further, we are in discussion to add products for the larger-sized battle tanks. During quarter three, FY 2024, Alicon has booked new orders aggregating INR 682 crore. With this, our total new order booking has reached INR 9,000 crore, which is executable over a period of six years from 2023-2024 up to 2028-2029. Please note that this is net new business and the products for which SOP has already commenced and are expected to continue and are not a part of this number. Some steps being taken to enhance our competitiveness include the initial phases of our automation journey. A roadmap has been devised to assess areas rich for automation within our processes. We are diligently evaluating the advantages and efficiencies that this paradigm shift can bring, segmenting components of our processes into different stages as one: ready for full automation, second: ready for partial automation, and third: not suitable for automation. We believe the benefits are manifold and expect automation to not only yield cost efficiencies but also elevate process excellence and product quality throughout our operational landscape. On this note, we are now open, I mean, we can open the floor 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 the touch-tone phone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use only the handset while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. We'll take the first question from the line of Yash Dalal from Sushil Financial Services. Please go ahead. Hello? Yes, Mr. Dalal. Please proceed. Yes. Hi. Firstly, congratulations to the management for achieving record revenues this quarter, and thank you for this opportunity. So I have a few questions. First was, what is the volume growth in Q3, and what is the fall in realization this quarter due to raw material price fall? Could you please guide us on the same? Sir, on the management's line, I would request you to kindly unmute yourself and speak, please. Hello, Caller. Yes. On the increase in volume on the sales for quarter three, we have noted an increase of 12% over the last year quarter three and 5% on quarter-over-quarter basis. Yes, what is your second question? Yeah. So what is the fall in realization this quarter due to raw material price fall? Yes. For the quarter, actually, when we worked out this, due to the effect of aluminum prices. So for the full year, we are estimating approximately INR 50 crores is the impact. That converts into 3% of the sales. So that is the impact. So when we are talking about to reach our full-year growth of approximately 30%-14%, so you can add up so easily, we can say 16%-17% in real numbers. Okay. And so we were focusing on the reduction of noise parts. What has been the contribution this quarter? Yeah. Yes. I will take this question. So for the noise part, as you know, it's part of our strategy and the customer also because then they place the order. They place the order in a bunch that we have to take the small volume part as well as the high volume part also. So we cannot deny our customer to give us a low volume part. However, in isolation, if some low volume parts are coming, so we generally deny those parts. And the earlier prevailing parts, which were in the production, is now going out with the life of those products are ending. So we are reducing significantly the noise parts. Okay. Okay. And so another question is, you had mentioned previously ROC to be at 25% when we reach our guided revenue of INR 2,200 crores. Are we on track for that? ROC 25%, so we have not given the guidance. For 25% ROC guidance, that is our aim. That is the goal. But by 2025-2026, that is a difficult target, what you are talking about. So because year-on-year, there will be growth, and we have a good target for maybe we can stay on at least 2% year-on-year basis. Every year, some improvement we can see in the ROC. Okay. Okay. And any capacity additions needed for FY 2025 and FY 2026? Yes. When we are talking about the continuous growth and we have given the guidance for 2025-2026 for INR 22 crore+, and we are moving from small parts to bigger and critical parts. So we need some new equipment, all this. So in this year, as we have guided, approximately more than INR 80 crore, we are already invested in the nine months. And for full year, maybe INR 100 crore+, we will be there. And next year, now we are adding more capacities to be ready for the 2025-2026. So maybe INR 20 crore-INR 130 crore; at this moment, the expectation is for the investment in the next year. Okay. Okay. All right. And just the final question. So the ESOP impact, what will be the impact continuing in the next financial year? The next year, very small impact because this year, approximately around INR 15 crore impact will be there, but next year, maybe INR 3 crore-INR 4 crore, not more than that. Okay. Okay. Okay. Thank you so much. That's it from my end. Thank you. We'll take the next question from the line of Jyoti Singh from Arihant Capital Markets Limited. Please go ahead. Yeah. Thank you for the opportunity. And sir, congratulations on the good execution and better set of order books. Sir, my question is on the export side first. Is there any seasonality pattern in H2? Our global numbers, yes, we noted, have increased in quarter three also, and that was led with an opportunity of delivering a critical part to Jaguar. So, talking about global market numbers, we are in discussion with existing customers where the anticipated volumes will be muted, not that aggressive, but Alicon is able to grow more against those numbers as we are penetrating with more of such parts with existing and also tapping new customers. So yes, going forward, we see volume might be on the lower side of the auto industry in global terms, but we see we are going to overpass those numbers with additions what we have done in the past and also being aggressive going forward. Okay. So Jyoti, for this quarter, you have reached the global sales of 28%. When you made a comparison for the last year, it was, I think, 20%-21%. So there is a big jump in the numbers. And continuously, as we are explaining that our focus is on the global business, so we are expecting to grow year-on-year in this global business. Okay. Sir, we have done very good on the year-on-year basis, but if we see on a month-on-month basis, so that's not that great. So any reason for that, sir? We are not achieving on quarter-over-quarter basis, which numbers? No, no. I'm asking a month-on-month basis. So if I compare December to January, so it's not that great. So maybe. Okay. We can discuss later on this, sir. So my another. Where you are coming from, those numbers are not clear because we have not declared any month-on-month number. Yeah. Fine, sir. We can discuss on that later. So my next question is on the Maruti side. We're going to get the order from Maruti Gujarat Plant. So are there any products besides cylinder head or only will be doing the cylinder head part? Cylinder head is an A-class part where we try to gather or participate with our customers. There are other opportunities also when you talk about low pressure and GDC, what we are into. But our main focus is cylinder head because it's an A-class part and gives you good recognition and value addition to a customer. Jyoti, mainly that we need to understand from Maruti Suzuki. You know the volumes, what kind of volume they are having. First of all, there is entry into cylinder head. And at present, we are having very low volumes, approximately 40,000-50,000 a year on that basis. But now they are increasing that volume and giving the opportunity to enter into their new models. So when we are talking about it, it was 1.2 liters, so approximately one liter, 1.5 liters. So all these new models are coming up. In the coming period, maybe we are expecting to deliver good numbers for 2024-2025. So that is the first big opportunity we are having. And maybe we'll see that based on the performance. So the opportunities are there for the other new parts. Yeah. Jyoti, I would like to add. You already know the relationship between Maruti Suzuki and Toyota. And we are already supplying the hybrid cylinder head to Toyota, which is a very, very complex part. And first time in the history of Toyota, they have outsourced the cylinder head. And Toyota will assemble the engines for the hybrid in their plant to supply to Maruti Suzuki. So that way, Maruti Suzuki is also very confident about the capacity and the capability of Alicon, and that is also helping us to increase the turnover and the business relationship with the Maruti. As Vimalji are explaining, the Maruti owns almost 45% share of business for the Indian market. So those will be a huge number for Alicon. Thank you. Yeah. Thank you, sir, on that. And so another, we are doing in two-wheeler almost 50% market share in the two-wheeler with cylinder head. So similarly, we are targeting in the four-wheeler? Yes. That's what we were trying to explain. So ideally, this four-wheeler cylinder head, if you go back, see traditional way, it was being manufactured at customer end because it was an A-class critical part which customers were not willing to offer or share the know-how to others. But we got this traditionally, the cylinder for four-wheelers, they were doing in-house or they were offloading to a technical partner who are experts in this domain. But we got this entry into the cylinder way back in 2018 when Renault came to India and were very aggressive on price and were looking for suppliers who can match that price and deliver such a critical part. So we got renowned with Renault for India. Eventually, after a year, we got this opportunity to supply to their Brazil location. This gave a lot of visibility to existing and upcoming customers. Secondly, then we got this opportunity with Toyota when they recognized our successful deliveries. As Mr. Shyam explained, first time in the history of Toyota, they outsourced and they were comfortable with Alicon. And this is a history of 70 years. And thereafter, we got again a breakthrough with Stellantis. Stellantis, they came up in India again two years ago, and they are aiming to make engines of 300,000 a year. It's a big volume for India as well as for global market. So there also, we got an entry supplying cylinder heads for 100% volumes. And even for that cylinder, we made a model cell with a lot of automations like auto pouring, core extraction, casting extraction. So we made a model cell to explain our customers and prospective customers. So basically, these steps are again, the customers understood that even Alicon is a company who can deliver such critical parts and can participate in the upcoming developments. And also, Maruti now started offloading the cylinders. So now, going forward, we are aiming to increase penetration with our existing domestic customers and also to explore the global customers, which in coming quarters, you might see because strong discussions are already started with a few global customers, which we see an opportunity to convert in coming quarters. So Jyoti, if we conclude your question, so the two-wheeler, we are already down from 50% to 42%. So that share is going down, and the four-wheeler has started increasing. And hopefully, next three to four years, we will have a much, much bigger share of four-wheeler if compared with the two-wheeler. Two-wheeler will be on the lower side in comparison to the four-wheeler. Okay. Thank you, sir. Sir, my next question is on the JLR order. So could you offer insight into the JLR order specific and the expected quarterly delivery volumes if we can disclose on that, please? Yes. So this order, we passed almost a year and a half ago, and this is a big order. These are two parts ideally of 28 kg, so ideally two parts to one vehicle with a volume of 250,000 a year. And this is one of the critical and complex parts for the EV vehicle. And this is for the existing, I mean, the ICE Range Rovers and Land Rovers, which you see in the roads. So ideally, they are going to replace those models with the EV. So this will go to that platform. It's a huge opportunity where they are anticipating to cover global volumes. Talking about our supplies, we started this development, initial supplies from Europe as a soft tooling, which you have noted that they've already started supplies in this quarter. Eventually, we see volumes in coming one or two quarters. We are now already in full-fledged execution plan to deliver this part from our Indian locations. We are planning to submit the initial samples in the next couple of quarters and thereafter to start supplies in the coming year. Mainly, this year, we have already started supplies in the year of 2023-2024. We have been in effect in quarter three of the current year as well as it will continue because quarter four and then quarter one of the next year, quarter two. But these are the proto-businesses and the double because it is in development stage. The mass volume will start from the 2025-2026. In the 2025-2026, hopefully, they will have the volume of around 150-170 thousand numbers. That is the expectation. Maybe INR 150-200 crore addition in the sales we can see from there. Okay. Thank you, sir. Sir, my last question on the growth side. So what are the expectations for the 2025 and 2026? So, sir, for 2025-26, our target is INR 2,200 crore. Hopefully, we should be able to achieve that, and we are in the right direction. Okay. Thanks a lot. Thank you. We'll take the next question from the line of Faisal Zubair Hawa from HG Hawa and Company. Please go ahead. Sir, what is the chance that we move our capacity utilization up to at least above 80% levels because only that will improve our ROC and ROE quite well? And what does it need as far as shop floor changes? Or is it that the orders that we have received are having some time gaps due to which we are not able to reach this capacity utilization? So I'll just explain this. So first, when you are talking about how to improve our capacity utilization, so mainly, we have to understand the processes here because there is a fluctuating volume, and we have to keep our capacities idle for the customers' volume fluctuations because it is not a constant, and there is a consistency in the volumes. So that takes around 15%-20% of that capacity. We have to keep idle. And secondly, is that when you that every time we are talking about what are the structural changes coming in the Alicon business? So all machines, those are we are using. Those are not 100% convertible from one part to another part. So somewhere, we have to use a dedicated machine for the particular parts. So then the green shifting is happening from smaller parts from two-wheeler to when we are moving to the critical parts. So 100% utilization and conversion will not happen. So some capacities or some machines, we will have to keep idle for this and add new machines. When we are talking about the utilization, when we are going for the new businesses also, so when we are adding the machines here in this year for maybe 2023-2024, so we have to put the capacities, but the utilization and maybe 70% or 80% will happen maybe after six months and nine months after putting up the capacities. And during that period, we have to put another capacity. So this is a continuous process. So that makes our capacity idle for maybe 25%-30%. So then what is the second method of improving the ROC and ROE? Because whatever you may say about product mix and all, if the ROC and ROE doesn't come in, that means this is not a very capital-efficient business. Oh, industry is a capital. We need capital. But you see that on the last 4-5 years, the continuous improvement in the ROC, ROE, you will find. And this year also, we are going to improve more than 2%. And that I'm explaining. So maybe next 2-3 years, we should be able to cross 20%. So that is the first target we are having. Okay. Thank you, sir. Thank you. The next question is from the line of Manas Jain from Jus Enterprises. Please go ahead. Yeah. Hello. Manas here. Just one bookkeeping question. So the incremental sales what we have delivered from quarter-over-quarter, I believe this is more pertaining to Maruti and Toyota. So is this being recorded from the European entity or because I saw that incremental change was in the consolidated numbers? So I just wanted to clarify that. With Maruti, what we are seeing that now is the structural change is happening in Alicon Group sales. So when we are explaining the growth in the sales of Maruti and Toyota, so on the other side, we are also saying that two-wheeler sales is not up to that level of that industry is performing. So the growth this quarter is main growth has come from Europe because earlier, this JLR development, prototype business, everything was planned in India. But now seeing the criticality, so it was decided by the management and the board to do all these developments in Europe due to the availability of the machines, availability of the technology, the technical people, the toolings. So it is not like that in Europe, it is happening, but Indian sales is happening in Europe. That was supposed to earlier in India. Okay. Second question is that, I mean, what is the anticipated growth rate we are seeing for next year? I understand you said 16% CAGR, but just next year, what is your guidance? So it is a very rough idea because we are also in discussion with the customers. But our expectation is between 15%-18% growth at least. Okay. Okay. Thank you. Thank you. We'll take the next question from the line of Prolin and Individual Investor. Please go ahead. Yeah. Hi, team. Thank you for taking my question. I have one suggestion, right? I mean, can you be kind enough to include your order book quarter-over-quarter in your presentation so that we can see a clear trend of what is happening in the next—I mean, last 8-10 quarters? So that is on the suggestion side. But coming to the larger question of your order book, right? I mean, you mentioned a number, right? I mean, can you give me some construct in terms of what does this order book constitute, right? I mean, in terms of two-wheeler, four-wheeler, EV, non-EV, defense, non-auto. Can you give some texture on what is the order book looking like? Yes. So this order of what we are booked in now, if we see from the outlook of sales from 2023-2024 to 2028-2029. So ideally, if I can give you a little background with so just to start with Rajiv, when we give the complete structure of the sales. So first of all, the order book what we are talking about, it is around INR 9,000 crores. That will start base year of 2023-2024. In the current year of 2023-2024, out of this, maybe approximately INR 700+ crores, we are going already, we are going to execute it. So he is going to give this breakup because we are not now taking considering the old stuff that has already happened since 2022-2023. Sure. Yeah. Now, Rajiv. So to talk about the contribution of this order book, around 32% goes with the EV parts. So this is again where we wanted to enter, and we are very happy and pleased to share that we have done quite well in this area where a lot of companies still in India are just starting up to enter. And even on the technology agnostic, where we are aiming to leave a good mark, where we have touched around 6%. So that is also. Technology agnostic is that where it doesn't matter whether we are manufacturing. It is going for ICE or EV. If we see further, exports are around 55%-56%. That is the major thing is going to happen when we are targeting to export, to contribute. Export is global business including our European facilities. 50% of the total revenues that we are targeting. If we see segment-wise, this contributes around 80%-84%, the four-wheelers where we were aiming to increase our share. Just around 10%-12% is to two-wheeler. The rest is to the four-wheelers where we were aiming to increase our penetration. There we also have done well as per our strategy. So this is another answer to Jyoti Singh from Arihant. So the structural change in two-wheeler and four-wheeler. So major contribution will come from the four-wheeler and going to replace the two-wheeler, major big contribution. Non-auto would be what part of our order book, sir? Non-auto looks to be around 4%-5%. Okay. In case if some of these discussions that we are having on defense side, in case if they fructify, I assume that the thing that you mentioned, right? I mean, on the defense comment that you made, that is not part of your INR 9,000 crore order book. So can we see that in case if some of these discussions on defense turn out to be in our favor, the share of non-auto will go up? Is that a fair way to look at it? Praveen, just to update, do not included in INR 9,000 crore. That is true. So that will be over and above of the INR 9,000 crore. But secondly, what is happening, our order book is so high with the automotive businesses that if you see the percentage term, although we are in the non-auto in the absolute value, but in percentage term, it always looks low because we are playing much bigger role in the automotive. Sure. Sure. Correct. One more question on my side. I have been tracking your company for quite some time now, right? What I find a bit difficult to understand is that we have such large order book, right? I mean, such marquee customers. The transformation that you talked about from two-wheeler to four-wheeler is happening at in order book is very visible. That is current. You have to see its true colors in the form of revenue. What I understand is that, let's say, for example, this year, we will end up somewhere between INR 1,450 crores-INR 1,550-odd crores. There is a part of that revenue which, in a way, is a drag, which, in a way, is reducing, which, in a way, you consciously also want to reduce, right? Because you want to move away from that. Because if I look at your this year's revenue of INR 1,400 crores and I mean, let's say INR 1,550 crores, INR 700 crores is coming from incremental order book, which means that there is a part of the business which is dragging our overall numbers, right? Could you quantify what part of our business is declining, right? I mean, for whatsoever reason, conscious or market-related reasons, right, in some sense? And when do we see in which year do we see that this incremental order book will probably be more than enough to take care of this drag that we are talking about? So can you just philosophically help me understand this question? Well, actually, what is happening, we are already explaining that we are reducing the business size of these noise businesses. We have stopped this. And there is a life cycle of our products. So maybe five years, seven years. So some parts are already going down. The volumes are going down. And maybe when they are contributing maybe INR 50 crores, now the contribution has gone to INR 5 crores or INR 10 crores. So that is a continuous process that is going to happen, and it will continue. And as well as when we are going for the new businesses, earlier, maybe the life cycle of the parts was 10 years or 12 years, or maybe I have seen the 15 years. But now it is reducing to 6-7 years. So that is happening, and that is the reason if you add from the existing business and the new businesses, so that will not end up in the total sales. So definitely, there is a so that is definitely the decline in the regular already running businesses. And especially when we are not taking because this is our management strategy decision also from the management. Because that if we want to go to increase our top line, it is very easy for us. Just reduce my sizes or something, some relaxation due to the customer, immediately, I will be flooded with the order book, right? But our aim is to improve the order line, improve 10 times. Now you are seeing that people are asking for the ROC improvement, EBITDA margin improvement, the bottom PAT improvement. All this happens when we see that somewhere, I have to compromise on the low margin businesses. Sure. Yeah. So how do we quantify it, sir? I mean, let's say, for example, if this year, we do close to INR 1,550 crores of turnover, out of that, you are saying that INR 700 crores is coming from that order book that you have always been talking about. So let's say 50% of your FY 2024 sales is coming from the incremental order book. Out of that remaining 50% of INR 700-750 crores, that's your core business. What is the kind of decline that we are going to see? Suppose when we are talking about because in the last year, maybe if I say that INR 450 crore addition has come from the new businesses, and this year, I'm talking about that INR 750 crore. So around INR 300 crore increase from the new order book. But the overall increase has happened approximately it will happen approximately INR 200 crore. So INR 100 crore, this has gone down. Maybe out of this INR 100 crore, INR 50 crore I have explained due to the impact of the aluminum prices. Sure. Sure. So how long? This is a complete combination because it's very difficult to quantify due to this declining because many combinations are there to work out this. When we talk about just a rough idea that's given to you. No, that's fair. But I mean, let's say, for example, if you can't quantify it in INR crore, is it fair to say that, let's say, in FY 2025, on a whole year basis, your new order book or incremental order book will be substantial, or will it be 26 in that year, in FY 2026, where we won't be talking about this noise equipment, so to say, right, in some sense, or noise supply? Which year that would be where this drag is, I mean, very low that we don't discuss at all, right, in some sense? When do you think that year will arrive? Will it be next year, or will it be 26? Around 70%-80%, you will see in the next year. And yes, in 2025-26, you will see around 90%-95%. Great. So 2025-2026 is when all these efforts that we are making since past two to three years will finally show results in terms of pure sales and then margins and ROC in our. End of year, yeah, we can say that can be very clear. Okay. Thanks a lot, team, for taking my question, and wish you all the best. Thank you. Thank you. The next question is from the line of Kumar Saurabh from Scientific Investing. Please go ahead. Hello, sir. So first, congratulations for beating the market industry in the last 3, 4 years and having an aspiration to do that for the next 2, 3 years. I have three broad question areas. The first is on aspirational growth rate. And to achieve that growth rate, we are, of course, dependent on industry to do well. And if we look at the auto cycle, of course, depending on whether it's commercial or PV or two-wheeler, the cycles are different. But 2-4 years, the cycles stop out. And we have an experience from 2018, 2019. And though we have beaten the market, the kind of aspiration we had that time, we couldn't achieve. So from a risk perspective, we are doing well. We have good order book. But how do you see from an industry cycle perspective, are we confident that we will achieve this number? We have a good order book, but do you see, based on your learnings from past cycles, do you see if the industry cycle tops out, the order book can also reduce? So my broad question is, given the industry context and the cyclicity of industry, how confident we are to achieve this aspirational growth? My second question is around our technical capabilities. So in a layman's term, and we have invested a lot in the last two, three years to build the technical capabilities, and it is getting reflected in terms of the four-wheeler order book, in terms of the growth and all of that. But if in layman's terms, you can explain how we are technologically better than our competitors and in all these new kind of businesses who are our two close competitors and how we are better than them, what we have done in layman's terms, that will be good. The third question is more around financials. So of course, I think in the last 3, 4 years, from a 10% ROC, we have gone to 14% ROC. We have an aspiration to go to 19%-20%. So how that will happen? Will that happen because a four-wheeler business will be a higher margin business compared to a two-wheeler business, or whether it will lead because of better asset utilization? I also see your cash flow conversions have also improved. If I look at 80 years versus five years versus 3-year trajectory, your EBITDA to cash flow conversion is improving. Is it because of working capital improvement? I just want to understand the drivers of how the better ROC will be achieved. So these are my three broad question areas. Thanks, Saurabh. I'm involved in all of your work. Talking first on the first point, yes, even we have noticed volumes are moderate, unlike 2018, 2019, where the industry was noticing a double-digit growth. A lot of changes were noted. Traditionally, a development by any OEM, the product were live for maybe 10 years, 15, or some case, Maruti's, we have noticed 20-25 years. But now we are noticing the lifespan of product is very slow. And that's the reason, after 2018, 2019, we understood the urgency to enter in different portfolios, penetrate with existing customers and enhance our portfolio, add new parts from existing customers, and also look for new customers in domestic as well as global regions. So we have done predominantly very good in these areas. Also, we were aiming to shift our focus from two-wheelers to passenger and commercial vehicles. And also, we were aiming to how to drive further was to increase the value addition. If you see, traditionally, we were 50% with a two-wheeler where the option to supply machined part was very rare. But as the shift is going, the customers are looking for a ready-to-use component in their assembly, which includes the value addition. So on that ground, also, we see good momentum. And as the industry is also noticing a changeover from ICE to EV, the OEMs, the majority four-wheeler OEMs, are looking to see partners, not suppliers, but partners who are capable of giving such critical solutions. Like the example of Maruti, they are offloading Maruti UV, I mean, 50% of the volume of the market share is a big volume, and they are coming up and giving opportunity to Alicon, Toyota. You have seen the example. So some developments we see is a good opportunity to overpass the traditional numbers of growth and leave a good mark in the growth numbers. Mainly, in this, we are not totally dependent on the growth of the industry. So always looking for the new parts, new customers, and expanding ourselves in that area. So that is giving the major support for the growth. As well as when we talk about because we see that cycle is there always. But at this moment, looks like that chances are less for this downfall because the government sees the policies and infrastructure investments done by the government and development. A lot of new highways, roads are coming up. So the demand is growing in the auto world. Clearly, we can see in this. Maybe somewhere, a little bit it has to improve on the lower-cost vehicles. But on the mid-size and the larger luxurious side, the growth is phenomenal. So that is the area. And like that, and when we are talking about the technology, like Rajiv has explained, so maybe Shyam would like to explain on that. Yeah. On the technology trend, if you see, we are supplying almost 90 parts for the EV industry. And this journey we started in 2016 and 2017 in Europe. We have an advantage that we have a plant in Europe. So whatever the European requirement, which comes in advance of 5-6 years of India, so that we developed and already mastered those capabilities. So when these products like motor housing now coming to India, so we were the first choice for the OEM and also the supplier, Daimler, and they choose us. So now we have developed good competencies on very critical parts where we have thermal engineering solutions, which we are providing. So those solutions are very liked by the EV customers. And especially if you see the motor housing and now the E-Axle part, which is also a very, very complex part, and even JLR appreciated the efforts of Alicon to develop such a critical part at first time, right? So if you see, in these areas, we have developed lots of competencies with the help of our European arm. And now we have mastered those technologies in India. So if you see our customer base, we have all the marquee customers in our customer base. And in the EVs, we have developed most of the critical parts, which comes out from the aluminum casting from the LPDC and GDC. So this gives us a good base to develop further competencies and increase our share with the customers. Now, secondly, we are also working on the HPDC part. We have already got the order of On-Board Charger, which is a very complex part. It is in HPDC, the assembly of three parts. So we will also move up the value chain by supplying the assembled part with the friction stir welding. So our management is very, very focused on working on the new technology and master those technologies so that we can increase our revenues and also the bottom line. I hope, Kumar, we were able to answer your question. Yes, sir. Thanks a lot. If you can, thanks for the elaborate answer. If you can, one, discuss on the financial side and who are the close competitors in all these emerging areas of business? Talking about competition for Alicon, we have got competition segment-based. Also, it's the customer in-house OEMs. I mean, the in-house OEMs like Maruti, Toyota, the in-house foundry we are competing. Talking about two-wheelers, yes, they are various players. But yes, we pioneered in terms of solutions, in terms of delivery, in terms of volumes because we being a big player in this region and serving since long. In four-wheelers, yes, we are competing. One is our OEM, and second is several domestic as well as global players. To name some, it's Nemak, it's Craftsman, it's Linamar, where we are aiming to grab those shares, and thereafter, cater to our customers. Actually, these big players are not our competitors, but we have to become their competitors. Now, we have to enter in their area. Thanks, sir. On the financial side, what will drive the ROC to higher numbers? So definitely, you know that the structural change in the business when we are moving from this low-margin business to the higher margin. So that is the major driver. And we are more focused on the cost downs as well as now, we are seeing that maybe you have seen that the improvements. But definitely, again, we are more focused on how to control our working capital, maybe in discussions with the various customers for their terms also. And another side is that the investments, how to control and maybe to reduce our investments. So definitely, based on this, maybe for our capital employed, control will be there. So that is hand to hand. It is linked with each other. But there is definitely a clear roadmap we are having to improve the margin as well as the ROC. Sure, sure, sir. And one last question. I don't know if you have looked at the business from this angle. So when we look at auto industry and when we look at the low-cost auto versus the premium, whether you look at two-wheeler, the low-cost two-wheelers have suffered the premiums do relatively better. When it comes to four-wheeler, in Maruti, also, the low-cost segment is not doing well. So when we supply as an ancillary player, we supply parts to the various two-wheeler, four-wheeler CV companies. If we talk in terms of revenue distribution, how much is there in low-cost versus high-cost? And is there an intent to move our more and more revenue from low-cost OEM products to higher-cost OEM products? Any views on that? Yeah, Kumar. If you see in two-wheelers, we are supplying the parts to low-cost two-wheelers as well as to the high-cost. If you see the Royal Enfield. So there also, we are supplying. And in most of the models, we are single-source. And if you see the four-wheeler also, so we are supplying to Toyota Hycross. And if you see the cost of that vehicle is more than INR 30 lakhs, almost INR 40 lakhs, you can consider. And you see the waiting period. So we are across the segment. And our endeavor, of course, will be to supply the high-value parts to all OEMs. But to generate revenue across all segments, we cater all segments. However, the focus will remain always on the high-value segment parts. Got it. Thanks a lot, sir. Thanks for all the detailed answer, and wish you all the best. Thank you so much. Thank you. Ladies and gentlemen, that was the last question. I would now like to hand the conference over to the management for closing comments. Over to you, sir. Thank you. I hope we have been able to answer all your questions satisfactorily. Should you need any further clarification or would like to know more about the company, please feel free to contact our team or CDR India. Thank you once again for taking the time to join us on this call, and we look forward to interacting next quarter. Thank you very much. Thank you, members of the management. Ladies and gentlemen, on behalf of Alicon Castalloy Limited, that concludes this conference. We thank you for joining us, and you may now disconnect your lines. Thank you.