Ladies and gentlemen, good day, and welcome to the Q1 FY 2025 Earnings Conference Call of CERA Sanitaryware Limited. As a reminder, all participant lines will be in the listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing star, then zero on your touchtone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Mayank Vaswani of CDR India. Thank you, and over to you, Mr. Vaswani. Thank you, Michelle. Good morning, everyone, and thank you for joining us on the earnings conference call for CERA Sanitaryware Limited to discuss the Q1 FY 2025 earnings, which were announced yesterday. We have with us today the management team, comprising Mr. Vikas Kothari, CFO, and Mr. Deepak Chaudhary, Vice President, Finance and Investor Relations at CERA Sanitaryware. We will start with brief opening remarks from the Management, following which we shall open the call for Q&A. A quick disclaimer before we begin. Some of the statements made in today's conference call may be forward-looking in nature, and a detailed note in this regard is contained in the results documents that have been shared with all of you earlier. I will now turn the call over to the Management for their opening remarks. Over to you, sir. Thank you, Mayank. Good morning, everyone. On behalf of the Management team of CERA Sanitaryware Limited, I would like to welcome you to our earnings conference call. I will begin by sharing some updates on the operations and strategy, following which our CFO, Mr. Vikas Kothari, will run you through the key financial highlights. The first quarter of FY 2025 continued to experience challenging market conditions, driven by subdued demand across key markets, intense heatwave conditions, and the effects of general elections. Despite this headwind, the company reported revenues of INR 398 crore and profit after tax of INR 37 crore for Q1 FY 2025. Our Sanitaryware and Porcelain business segments contributed 53% and 36% of our total Q1 FY 2025 revenues, respectively. While our sales this quarter did not reflect significant growth, we remain committed to our long-term vision. To be noted that Q1 results will not impact our guidance since we have already taken into consideration the expected slow performance in Q1 and Q2 of the financial year. We are confident that growth will gain momentum from the later half of the year. New product development accounted for 32% of the total sales in this last quarter. Over the past two years, there has been a growing consumer shift towards luxury properties and high-value bathroom fittings, especially in the major cities. To capitalize on this trend, CERA has been undertaking strategic measures to enhance its offerings and capabilities. We are committed to strengthening our presence in the Luxury segment over the next five years. Although we are still in the early stages of seeing substantial numerical progress, our focus remains on laying the groundwork for this long-term growth. Our upcoming product launches will continue to feature innovative designs and value-added features tailored to luxury-seeking consumers. As most of you are aware, CERA currently has four distinct brands: CERA, Luxe, Polipluz, and SENATOR. The introduction of new SKUs, the refreshing of existing lines, and expanding into new product categories have significantly broadened our portfolio. While our flagship brand, CERA, continues to perform strongly in the key markets, Senator, Polipluz, and Lux are poised to make notable inroads into the luxury segment. Additionally, we are focusing on penetration in Tier- 2 and Tier- 3 towns to meet the evolving demands of these markets. This balanced approach not only reinforces our commitment to serving a diverse customer base, but also strengthens our market position and adaptability. By seizing opportunities across all market segments, we ensure our relevance and competitiveness while maintaining margins. In Q1 FY 2025, our imports from China totaled INR 7 crore, representing 2% of the sales. CERA remains committed to reducing reliance on Chinese products by enhancing our in-house manufacturing capabilities and diversifying our supply chain sources. In the previous financial year, CERA successfully completed the expansion of its porcelain facility, which increased our monthly production capacity from 300,000 to 400,000 pieces. I'm pleased to report that the plant is running efficiently after the ramp-up period. With adequate inventory levels, we have optimized our production strategy to achieve an ideal balance between production and inventory, resulting in porcelain capacity utilization of 84% in Q1 FY 2025. Regarding our upcoming greenfield sanitaryware facility, we have successfully acquired a major land parcel. These developments is ongoing to secure the remaining land, which is anticipated to be completed by September 2024. The strategic expansion in sanitaryware and faucetware underline our commitment to broadening our premium and luxury product range, ensuring high quality and precision through advanced manufacturing technology and stringent quality control. Our budget for regular and routine CapEx for FY 2024/2025 is INR 25.40 crores, encompassing essential upgrades in our sanitaryware and faucetware plants, including machinery replacement, customer touchpoint enhancements, and IT developments. These investments are aimed at ensuring operational efficiency, risk continuity, and improved objectives. Since launching the retailer loyalty program in FY 2022/2023, we have enrolled about 20,000 retailers and accumulated more than 300,000 invoices on the application. Of the total retail sales amounting to INR 217 crores, 37% are eligible for loyalty rewards. In FY 2024, we achieved our highest ever advertising spend of INR 63.2 crores, representing 3.4% of sales. In Q1 FY 2025, we had spent INR 11.5 crores as compared with INR 11 crores in Q1 of FY 2024 towards publicity, which is in line with our projected spending for FY 2025. Our focus on effective cost management and operational efficiencies has enabled us to sustain our margins without implementing any substantial price increases. In Q1 FY 2025, our sanitaryware plant achieved a capacity utilization rate of 76%, reflecting our balanced approach to production and inventory management. For the quarter, B2C sales comprised 64% of our total revenue. Looking ahead, we anticipate continued strong demand from both B2C consumers and the growing B2B projects market. Strategically, we are leveraging project sales to manage inventory effectively. Maintaining strong margins has always been a priority at CERA. While we recognize the growing significance of B2B project sales and are committed to integrating this channel into our business strategy, we remain selective about the projects that we are undertaking. I would like to reiterate that CERA is committed to a comprehensive set of strategic initiatives designed to drive growth and strengthen our market presence. These initiatives include expanding our production capacity, enhancing our capabilities for complex and high-value products, and investing in new product development. Our continued focus on advertising and marketing aims to boost brand visibility while emphasizing on premiumization and improving our network and distribution channels, which will enable us to capture higher market segments. Additionally, we are prioritizing industry relationships through engagement with key influencers, such as architects and plumbers. Collectively, these efforts are intended to position CERA for sustained success and reinforce our competitive edge in the market. In conclusion, while Q1 FY 2025 continues to present some near-term challenges, CERA Sanitaryware remains resilient and focused on our strategic objectives. We are confident that our comprehensive initiatives will enable us to navigate these challenges effectively. As we move forward, we are optimistic about leveraging our strengths and addressing evolving market demands to continue delivering value to our stakeholders and maintaining our leadership in the sanitaryware and faucetware industry. With this, I would like to hand over to Mr. Vikas Kothari, our CFO, who will present the operational and financial highlights for the quarter ended 30th June 2024. Thank you, and over to you, Mr. Vikas Kothari. Thank you, Deepak, and a very good morning to everyone. I will now provide a brief overview of the company's financial performance for the quarter ended 30th June 2024. In Q1 FY 2025, revenue from operations stood at INR 398 crores, as against INR 427 crores in Q1 FY 2024, registering a decline of 6.8%. EBITDA in Q1 FY 2025 stood at INR 72 crores, as against INR 84 crores in Q1 FY 2024. EBITDA margins for the current quarter stood at 17.5%, as against 19% in Q1 FY 2024, registering a decrease of 150 basis points. The said decline in EBITDA margins is due to lower fixed cost absorption caused by decreased sales and higher discounts offered to address the challenging market conditions. For the quarter under review, 53% of revenue came from sanitaryware, 36% from faucetware, and 9% from tiles, and wellness contributed 2%. On a YOY basis, sanitaryware revenue decreased by 9%, porcelain ware revenue decreased by 5%, tiles by 20%, and the wellness improved by 16%. The sanitaryware and porcelain ware segment remains the cornerstone of our business, contributing 89% of total revenue. In Q1 FY 2025, 44% of our sales were in premium category, 32% in mid category, and 24% in entry level category. Profit after tax was INR 47 crore in Q1 FY 2025, as compared to INR 56 crore in Q1 FY 2024, registering a decrease of 16.1%. EPS for the quarter stood at INR 36.11, compared to INR 43.35 in Q1 FY 2024. In terms of the working capital, inventory days increased from 74 days to 75 days. Receivable days remained stable at 28 days, and payable days stretched from 30- 37 days. Consequently, the net working capital days were reduced from 72 days to 66 days in Q1 FY 2025. As on June 30, 2024, our cash and cash equivalents stood at INR 864 crore, marking an increase of INR 109 crore or 14.4% compared to the corresponding previous quarter. Regarding sales distribution, Tier- 1 cities accounted for 35% of total sales, Tier- 2 cities for 22%, and Tier- 3 cities led with 43% of total sales. In addition, I am pleased to announce that the Board of Directors, at its meeting held on 5th of August, has approved buyback of its fully paid equity shares through tender route at a price of INR 12,000 per equity share for an aggregate amount not exceeding INR 130 crores, excluding any expense incurred or to be incurred for the buyback. In conclusion, I want to reemphasize our commitment to maintaining strong financial discipline, leveraging our inherent strength, and solidifying our leading position in the sector. With this, I would now request the moderator to open the line for Q&A. Thank you so much. 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 touch-tone phone. If you wish to withdraw yourself from the question queue, you may press star and two. Participants are requested to use only hands-free while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Praveen Sahay from PL India. Please go ahead. Yeah. Hi, sir. Thank you for taking the opportunity. Sir, related to the, you know, the bifurcation which you had given, among the Tier-1, Tier-2, Tier-3, as well as, for entry and the premium level. So, if I look at your Tier-1, sales has actually increased on the YOY basis, and, Tier-3 and Tier-2 has been down. So, you had a seen a, you know, in the Tier-2, Tier-3, is a more competitiveness or, a demand slowdown is a severe as compared of a Tier-1? Yeah, Praveen, thank you for asking the question. So my understanding is, as far as the tier bifurcations are concerned, and if you compare with the previous comparisons also, so more or less, there is a demand slowness in all the tiers. However, if you see in terms of the breakup, means, for the Tier- 1, it was 35% versus the previous corresponding quarter, 33%. Tier- 2, it was 22%, and the previous corresponding quarter, it was 22%. And in Tier- 3, the percentage is 43% against the previous quarter corresponding 45%. So as such, if you see in terms of the impact of the slowness of demand is concerned, it has impacted all regions, all cities or tiers, and including the market segments. Okay. Okay, okay. So it just, your contribution has changed, however, on the everywhere you have seen the impact is quite equal. Yeah, correct. What I would suggest is we should not read too much into 1% or 2%, up and down between the tiers, in between quarter and quarter, because these changes will keep on finding, between one quarter to the next. So more or less, the idea is that it is not that one of the sectors are experiencing slowdown because the other tiers are expecting less, lower than the other, kind of a slowdown. We are seeing the our senses that all the three players are having a kind of slowdown, and we anticipate that this should improve from the second half of the year. Okay. Okay, sir. Second question is related to the, you know, the gas. How has been the gas pricing as an average, or if you can give the GAIL and the Sabarmati number as well? Yeah, regarding the gas cost, so as we have seen in the previous year also, the gas has largely benefited in terms of the overall price. So, gas prices remain favorable during this quarter also. The average gas price from GAIL was INR 28.38 per cubic meter, as against INR 29.31 in Q1 FY 2024. Similarly, the average gas price from SGL was INR 51.40 per cubic meter, as against INR 50.01 per cubic meter in... I increased drawal of gas from GAIL, reaching roughly 86% in Q1 FY 2025, which was 78%. Hello, sorry, sir. Sorry, sir, the line for the management has been disconnected. Please stay connected while I try to reconnect them. Ladies and gentlemen, thank you for patiently holding. The line for the management has been reconnected. Over to you, sir. Yeah, sorry, there was some disruption. So I was briefing about the gas cost. So the trend was positive in Q1, and the overall weighted average gas cost in Q1 was at INR 31.64, as against INR 33.91 in Q1 FY 2024, which is significantly lower as compared to the industry standards. Okay. Okay, and the last question, sir, is related to the margin profile. So, for this quarter, we had seen a correction in the margin. And, can you give some, you know, the rest of the year? Because your guidance of the EBITDA margin of a 16% plus, and INR 29 billion, March 2027, as you had said, you are sticking to that. So next nine months, where you are seeing this margin profile to be? Yeah, thank you, Praveen. So, as far as margins are concerned, as I have already briefed, that the margins were impacted because of the activity impact, but this we see it as a very short term. Our understanding is that we are quite confident in terms of the margin, which we will keep intact between 16%-17%, and I would say it will further improve as the demand situation will improve. So it is just the one quarter where we have seen or where largely means the all the major industry players, including CERA, have seen the slowness on account of different factors. So that has that has somewhat impacted the margin. For the rest of the year, we are quite confident that the margins will be maintained between 16%-17%. Thank you, sir, and all the best. Thank you. Thank you. Ladies and gentlemen, in order to ensure that the management will be able to address questions from all the participants in the conference, kindly limit your questions to two per participant. Should you have a follow-up question, please rejoin the queue. We'll take the next question from the line of Rishi Kothari from Pi Square Investments. Please go ahead. Hello. Thank you so much for the opportunity. And I had some couple of questions for stages. In the initial stage, you said that, okay, right now we are to quarter one FY 2025, was not a good quarter for the company, but we are maintaining our targets for the coming future. So do we have any set numbers that we have given that this target are going to be met in two, three years down the line for top end or bottom end sort of thing? Thank you. So, regarding the guidance, what we have given earlier, the guidance given earlier was of reaching the target of INR 2,900 by March 2027, which will remain intact. This target, actually we have set after factoring for the expected slow performance in Q1 and Q2 of the current financial year. We anticipate that the improvement in the demand condition will start from the second half of the year. As far as the guidance which we have given of maintaining a 16% CAGR over a period of three years is intact. Okay. And so, in terms of the actual offer in the market, I just see that the real estate market is anyway booming, that people are buying homes and all sort of things, and CERA is something that comes secondly to the value chain of real estate market. But still there is some muted demand. If we see the FY 2023- 2024 result, the revenue top line has not increased that much. So what's the main problem that you're facing? Is it people are actually going more towards the other brands, or organized sector is emerging, or what sort of things are we facing right now? I think the industry by itself has not been doing too great since quarter three of the last year. So it is not that CERA Sanitaryware that has not been performing well, it is the industry as such which is facing kind of demand challenges since Q3. And Q1 was particularly impacted because of elections and the intense heatwave conditions which was prevailing in the country. As Mr. Vikas mentioned earlier, like, we anticipate that from Q3 onwards, the demand situation should improve. And essentially what we want to stress is, this is not something which is impacting our company only, it is something which is impacting the market as a whole. So do we have any percentage of what the organized sector does, which segment are into in terms of percentage? Sorry, your question was not audible. Can you repeat again? What's the organized sector cut this top and this current calendar year for the industry for in the market? You are asking whether the organized sector has grown, in the last quarters or something, right? I didn't get your question clearly. No. What is the percentage of organized sector that we, that as a sanitary industry and as a faucet industry? You're talking about the size of the organized and the- Yeah. -unorganized sector? Yeah, yeah, yeah. Okay. Now, the figures are not being readily available, but what we generally estimate is that the sanitaryware industry size would be in the region of INR 5,000 crores, and the faucetware would be something like INR 8,000 crores. If we are talking about organized, INR 5,000 for sanitaryware and INR 8,000 for faucetware. The unorganized for the sanitaryware, there would be something like INR 4,000 crores, and faucetware would be INR 6,000 crores. Total would be something like sanitaryware, INR 9,000 crores, and faucetware, INR 14,000 crores. How do we have, we have seen the change in shift from organized to unorganized. Do we see any increase in terms of the growth targets, or do we see any sort of improvement eventually, from organized to or unorganized to organized? There has been some shift from the unorganized to the organized. Like, post the coming of GST, there was an anticipation that there would be movement of market share from the unorganized to the organized, which has happened also. But again, broad numbers, if you want specific numbers, those are not available. But, going forward also, you'll find that the shift from the unorganized to the organized is a kind of, you can say, slow process, because most of the unorganized sector is concentrated in the north belt. And you'll find that, as of now, they are facing a lot of challenges in quite a few respects. One in respect of the, kind of raw material increases which has happened in the context where the, the gas prices have increased significantly in the last, you can say three to four months. And also because of the fact that, the pollution would have started becoming more and more strict, in respect of, the kind of emissions and effluent which are being discharged. So this is a continuous process, and we find that as the market grows, it will be captured more by the organized player as opposed to the unorganized player, but it is a slow process. Okay. Got it, got it. And in terms of- I'm sorry to interrupt. I would request you to kindly rejoin the queue for follow-up, please. Thank you. Thank you so much. Thank you. We'll take the next question from the line of Udit Gajiwala from YES SECURITIES. Please go ahead. Yeah. Hi, sir, thank you for taking up my question. So firstly, when you specify that you are expecting demand to improve from H2, so, I mean, is that a hope or it is, you know, backed by some orders or some inquiries that you're already getting? And if so, then from which segment? No, sir, if I understand your question well, in terms of the guidance what we have given, is it backed by numbers or not? That is what is your question? Yes, sir. Largely when you are expecting, you know, a demand to improve from H2, and you also stated that softness will continue in Q2. So, you know, like, what gives you the confidence basically that demand will improve from H2? Because there is already a low base of last H2, since you stated that since last Q3, your demand has been weak. So I mean, just, you know, what gives you the confidence that demand will improve from H2? See, there are two segments in which we operate: one would be the B2C, another would be the B2B. The B2B segment has already started seeing improvement. If you look at our project bank size, this will be December, and if I look at compared December with June, December 2023 with June 2024, you'll find that there has been an increase of something like 15%-20% on our project bank size, which is indicating that the project business has started picking up. Retail has been really slow from Q3, and Q1 was kind of anticipated also because of the fact the general elections were there. So project is kind of already picked up, and we are anticipating that the project will be flowing on to the retail side as well. Q3, we are anticipating from the flow that we have already received on the project bank, that it should be reflecting on the retail side also. That is helpful, sir. Got it. And, sir, in terms of the product mix change, the premium segment that constituted around 44%, what was the number in last Q1? And, is there any target for this year or coming, say, by the time you want to achieve INR 2,900 crore top line, how much should premium be as a product portfolio? So just giving you the numbers in terms of the categories between premium, mid, and entry. So premium, it is 44% in Q1 FY 2025, and in Q1 FY 2024, it was 45%. Mid, it was 32%. In the previous quarter, it was 31%. And entry, it is 24% in Q1 FY 2025, as against 24% in Q1 FY 2024. So more or less, if you see in terms of the categorization between entry, mid, and premium, more or less, there is no major change. However, within terms of the efforts, what we are putting in terms of the new category, what we are under the three brands, we put, that is, Luxe, SENATOR, and the Luxury series, which is going to showcase our luxury segment. So that is at a very initial implementation phase. And in terms of putting the more product parcels or enriching the product profile, our team is working on that, and we will definitely see in the coming years on this particular category also to be growing. Another thing which I'd like to mention is that, as a company, our entire range, whether it is entry, mid, or the premium, enjoy a very healthy margin profile. Normally, the expectation would be that, the entry level should be having lower margins, so that the premium would be having very high margins. In our, especially in case of sanitaryware, across the three ranges, entry, mid, and premium, the margins are equally good. In faucetware, there was slight differentiation between the margins of faucet entry and the premiums. But otherwise, when we grow and grow in volume, whether it is mid, entry, or premium, the margins would be impacted in a positive manner, irrespective of the where the growth is coming from. But, our drive is always to move more towards to premium segment. That's good, sir. That was very helpful. Thank you, and all the best. Thank you. The next question is from the line of Onkar Ghugardare from Shree Investments. Please go ahead. Yeah. Am I audible, sir? Yeah. Yeah. Good morning. Good afternoon. My question was, basically, regarding the loyalty programs which you have done. Can you quantify the benefits which you have derived so far from that, and what kind of benefits you expect from those loyalty programs? The loyalty program, the main aim of the loyalty program is that, as of now, if you look at our distribution model, it is centered mostly towards the dealers. Like, we sell to the dealers, and the dealers are selling to the retailers or sub-dealers. Now, we kind of pass on benefits to the dealers, which they pass on to the retailers. The idea of the loyalty program is to pass on the benefits, which we pass on to the dealers, to be on... further pass on to the retailers, to go directly to the retailers. So what this loyalty program has done is we have been able to gather database in respect of what kind of retailer profile we have, what kind of buying that they are able to do, because whenever they are uploading their invoices, we get a sense about what kind of product preferences are there. And also, we are able to pass on the benefits directly to the retailer, which earlier we were dependent upon the dealer. So depending upon how we want to treat our like your sales, how we want to treat and push our products, we can design our loyalty program accordingly. So the main benefit which is there, that instead of relying on the dealer, now we are able to go directly to the retailer through our own programs. Is that only just to collect the database or any monetary benefit to the company in the long term? The monetary benefit is also there, and as I told you, it is enabling us to push the products that we really want to. One is that we gather information, we gather data, that what products are really being demanded by the consumers. And second is that when we want to push something, the benefits, the kind of rewards which were earlier being pushed to the dealers can go directly to the retailers. So that is kind of, you know, we have a direct subsidy program for the government, so we don't have an in-between. The person who was there as a middleman in between has been bypassed, and we are going in directly to the retailer and pushing these products which we really want to promote. The second question is on the cash position you mentioned. You have around INR 864 crore of cash. This is excluding the INR 130 crore buyback or including the buyback? And the question regarding that is actually, after doing the buyback, you will be continuing with the higher dividend payouts, which you have been doing, for the last two odd years, or how it will work out? Okay. So regarding the cash reserves, so just to brief you, the cash reserve position as on June 30, 2024, is INR 684 crores, which is including this buyback part, what we have recently announced. And if you see in terms of the options where we have the distribution of excess cash, so dividends, definitely if you see, we have increased the dividend significantly in the past two years from around INR 26 crores in 2021-2022 to INR 65 crores in 2020-2023. Continuing the same, the company has declared dividend of rupees sixty per share, which is amounting to INR 78 crores in financial year 2023-2024. So this is, this trend will continue in terms of, paying out healthy dividends as part of, maximizing the benefits or returns to the shareholders. And at the same time, the buyback is also announced, so that is the another part. And, in terms of the results which are there, means there are some CapEx, options which may come, so that can be taken care of. Just a small correction. The cash reserves was INR 864 crore. Yeah. It was including, this was before buyback. Okay. One party will be less than that, right? INR 864 crore. Correct. Yeah. Yeah. Okay. Thank you. Thank you. The next question is from the line of Aasim from DAM Capital. Please go ahead. Yeah, hi, morning. Two questions. First, on the sanitaryware plant CapEx- I'm sorry to interrupt, but Aasim, can you use your handset, please? Your audio- Yeah, just, just a moment. Sure. Hello? Yeah. Is this better? Much better. Please continue. Yeah. Just, so first question was on the sanitaryware plant CapEx. So 85% had already been acquired, the land bank. 15%, which was supposed to be done by June, now that is expected to be done by September. Any change in the timeline by the time the plant is actually commissioned? It was supposed to come by FY 2026 end earlier. So what we had said was that it will take 18 months from the date of commission, starting of the commissioning of the plant. It will take 18 months from the zero date. It has not yet started. As you rightly pointed out, the earlier timing was that we should be completing the balance parcel by June. What is happening is the land, the remaining portion of the land which is there consists of extremely small parcels, and acquisition of that land is taking some time. So we anticipate that it should be completed by September, October kind of a time. But, no civil work or anything has started on the balance land that you already acquired, is it? No, no. No civil work has already been started. That decision to start the civil work would also depend upon the kind of demand situation which we are seeing right now. Once we see an uptick in the demand, we will be starting with the civil work. The civil work, this is possible to start even on the portion of the land which has already been acquired. But still, by the latest that the plant would be commissioned appears to be October 2026, 24 months from October of this year. Assuming you do the land, this will acquire the balance land, right? Correct. If you are trying to gauge that, how we'll be able to meet the demand situation in between, why the way that we are progressing and how we are seeing it is, that we are already in a very good kind of inventory position. We have very good outsourcing arrangements, and also the kind of mix that we are having within our plants right now, it is possible to shift the mix and increase production of more female products once we see an upswing in the demand. So we don't see any challenge in terms of meeting the interim situation when the plant is under construction. So as of now, we are waiting for the demand to increase slightly so that we can start with the commissioning of the plant. Sure, got that. I think, you've made that your, yo u guys have made that pretty clear earlier also. Just was curious about when the new plant starts in. And second, to an earlier question, you just spoke about project sales are picked up. You also mentioned project bank that has gone up from 15%-20%. I just want to understand what exactly do you mean by this project bank? How do you define it? So what happens is, when we are receiving an order for a project, that will be received, you can say, three to four months till somebody is requiring it immediately, immediate delivery. So once we are receiving an order, the delivery period extends up to one year. Like an order which has been accepted today, some part of the order will be delivered today, and balance will be delivered after some time. And it keeps on happening because the requirement of the project also keeps on coming up in phases. So mostly when we are talking about the project bank, it means that orders which have been received, but which are to be executed, and normally the price validity and acceptance which we do remains valid for a period of one year. Okay, so it's just another term for order book, basically? Correct. Correct, correct. Got it. Okay, thank you very much. Thank you. Thank you. We'll take the next question from the line of Akash from UTI Mutual Fund. Please go ahead. Yeah. Hi, am I audible? Yes. Yes, sir. Please. Yeah. Hi. Hi, sir, thank you for the opportunity. Sir, just wanted to check what is the capacity utilization in faucetware segment plant? I missed that. So, regarding the capacity utilization, the faucetware plant is operating at 84% of the capacity in Q1, in this quarter, and the sanitaryware is at 76%, in this current quarter. And, this particular capacity loading down the capacity is to have a balancing impact in terms of the inventory what we are having, and to see with how we can speed up once the demand improves. Yeah. Yeah, sir. And, sir, I mean, you would... I mean, when you say that, we would be trying to achieve INR 2,900 crore revenue by FY 2027, if you can roughly share how would the, let's say, growth target look like in FY 2025? Or if not 2025, what would be the growth target in FY 2026, if you can share? So, with regarding the guidance, what we have given of the 16% CAGR over a period of three years. So like I told, we have already taken into consideration the performance, the first half performance of the FY 2025, which is going to be slow or muted. And on, if you see, for the whole year basis, that is 2024/2025 as a full year, growth is projected to be in single digits, and the, and the, the expected, compounded CAGR 16%, it is going to be achieved by the increased run rate when we see that the demand is going to be improved in the next two years. Okay. So basically, we are broadly expecting healthy growth in FY 2026 and 2027. Correct. Sure. Sir, and just one last thing. I mean, you said that project bank has increased. So, roughly over, let's say, over the next nine months or let's say by FY 2026, do you see revenue mix changing in favor of project segment? Or you still believe at least 65%-70% of the overall revenue would come from retail segment? Yeah, as of now, the total project to retail ratio is 64: 36. It was earlier something like 65:35, so there has been a slight change towards the project. So that would totally depend upon how the retail market is picking up, because once the retail market picks up, you'll find that it'll start going back to the level which it was there earlier. If there is a like stretch in the pickup of the retail market, then maybe this percentage might go up slightly again by a couple of percentage points. But if retail picks up, you'll find that it'll go back to the same level which it was earlier. Right. So even if, let's say, project segment comes to roughly 40% of the overall revenue, still we are fine with that? Correct. Correct. Because if you see the differential, like, the kind of margins that we earn in retail segment versus what we earn in the project segment, the discounts would be higher in the project segment by, we can say, 5%-6%. So if you are talking about the, kind of 5% movement from retail to projects, the 5% into 5% would be kind of 0.25% impact on an overall margin, which, we don't anticipate too much of a challenge as such. So, even if it goes up to 60/40, if it takes some time for the retail to pick up, we'll be fine with that. It will not impact the margins, by too much. Sure. Sure, sir. Thank you. Thank you so much. Thank you. The next question is from the line of Raj Shah from Marcellus Investment Managers. Please go ahead. Yeah, hi, am I audible? Yeah. Yes, sir, please. Yeah, okay. Thank you, sir, for this opportunity. So my question was regarding FY 2024 annual numbers. So, there is a significant reduction in power and fuel costs. So as a percentage of sales, it has reduced to 1.9%, which used to be 3%-4%, say, in last decade. And this is despite the fact that our purchases from and purchase of finished goods has also reduced. So the question was, what led to this significant reduction, and what we can expect in next 2025? I think you'll have to repeat the question. You're saying that our power cost has reduced by 1.9%. Has reduced to 1.9% of sales, which used to be 3%-4% of sales. It has reduced to 1.9% of sales as opposed to. 3%-4% of sales, which is last decade's average. You are asking why there has been a reduction in the power and the fuel cost? Yes, sir. Yes, sir. This is largely led by the increase in the consumption, which we have been able to do from GAIL. Like, we have two sources for gas: one is GAIL and another is from Sabarmati. GAIL is subsidized. Earlier, the draw from GAIL was much lower, so that the weighted average used to be higher. Now with the increase, like, which Kajal mentioned, we are able to draw 84% of our gas from the lower subsidized portion. So that is why the gas cost and overall this has improved. Also, we have the windmills wherein we, which kind of, compensates for the electricity cost, which is being incurred by CERA. In the last year, there were a couple of windmills were under repair, so we were not able to draw from there. So once we have come to the current year, all those draws have again resumed from the windmill, the ones which were under repair. So both these factors combined, like increased draw from solar power, sorry, from the windmill, and the increased draw from GAIL, have led to a reduction in the fuel and gas costs. Okay. So moving forward, what we can expect as a percentage of sales, what should be power and fuel? As a percentage of sale, it is, if you see, it is 1.3%-1.4%. It should remain at that level? Yeah. Okay. Thank you for that answer my question. Thank you. We'll take the next question from the line of Prince Choudhary from PINC Wealth. Please go ahead. Yeah. So I have two questions. First, the margin difference between premium, entry, and mid-level. And second, our current order book from project business. As I told earlier, the margins for the sanitaryware between the entry level and mid are more or less the same. It is slightly higher for the premium ones, but more or less, it varies differently across the various factories, across various ranges. But in sanitaryware, where even the entry level will have pretty good margins, comparable with the premium level, premium margins. In product range, there will be a slight difference. The entry won't enjoy such high margins as compared to the premium ones. For the respect of the order book, cannot give you the numbers as such, but, as I said earlier, the, as compared to December, the total order book has gone up by 15%-20% for projects. Okay, and the execution period for this? Uh, sorry? Execution period for the project bank. It normally like keeps on happening, but this like it's a continuous process, so order banks, the older ones keep on getting executed, we have newer orders which keep on coming in. The validity of an order is for the price that we quote, is valid for one year. Okay. Yeah, that's it on my side. Thank you. Thank you. Ladies and gentlemen, we will take that as the last question for today. I would now like to hand the conference over to the management for closing comments. Over to you, sir. Thank you everyone for attending this call and for showing interest in CERA Sanitaryware Limited. Should you need any further clarification, or would you like to know more about the company, please feel free to reach out to me or CDR India. Thank you once again for taking the time to join the call. Thanks a lot, and bye. Thank you, members of the management. On behalf of CERA Sanitaryware Limited, that concludes this conference. We thank you for joining us, and you may now disconnect your lines. Thank you.