Ladies and gentlemen, good afternoon. Welcome to the Pondy Oxides & Chemicals Limited Q3 FY 2026 earnings conference call. 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 this 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 Ms. Sana Kapoor from Go India Advisors. Thank you, and over to you, Ms. Sana. Thank you, Swapnali. Good afternoon, everyone, and welcome to Pondy Oxides & Chemicals Limited earnings call to discuss Q3 and nine-month FY 2026 financial performance. Today, we are joined by Mr. Ashish Bansal, Managing Director, Mr. K. Kumaravel, Director of Finance and Company Secretary, Mr. R.S. Vaidhyanathan, Executive Director, Mr. Vijay Balakrishnan, Chief Financial Officer, and Mr. Pratik Gupta, Associate Vice President Operations. We must remind you that the discussion on today's call may include certain forward-looking statements and must be therefore viewed in conjunction with the risks that the company faces. May I now request Mr. Ashish Bansal to take us through the company's business outlook and financial highlights, subsequent to which we will open the floor for Q&A. Thank you, over to you, sir. Thank you, Sana. Good afternoon, everyone, and thank you for joining us for POCL's Q3 and nine-month FY 2026 earnings call. I hope you've had the opportunity to go through our financial disclosures available on the exchanges. I will walk you through the key strategic updates, operational progress, and financial performance, followed by a Q&A session. I'm delighted to report that POCL has delivered its strongest ever quarterly and nine-month performance, driven by disciplined execution and operational efficiency. On a nine-month basis, revenue, EBITDA, and PAT increased by 33%, 96%, and 114% year-on-year respectively, supported by substantial growth in both production and sales volumes across our lead and copper business. I would want to mention that the India EU trade deal serves as a structural catalyst for POCL, enhancing our global price competitiveness, securing long-term demand visibility, and solidifying our status as an organized, compliant leader capable of meeting Europe's rigorous sustainability standards. On the domestic front, the regulatory environment continues to be supportive for organized recyclers, with stronger enforcement of BWMR and EPR frameworks, enhancing accountability and producers recycle, recyclers and collection agencies. This has led to more efficient collection mechanisms, reduced leakages to the unorganized sector, and improved traceability across the value chain. These measures have materially strengthened domestic scrap availability, enabling higher local sourcing. Before delving into the numbers, I'd like to begin with three strategic developments that are shaping up our growth journey. Our capacity expansion update. We are making steady progress on our capacity expansion roadmap. The second phase of lead expansion project, adding 36,000 metric tons per annum, was commissioned and became operational in December 2025. As a result, the total lead capacity has increased from 132,000 metric tons per annum in FY 2025 to 204,000 metric tons per annum, representing an increase of over 50%. The lead capacities are expected to ramp up to 70% in the coming quarters. Our copper recycling capacity is set to double from 6,000 metric tons per annum to 12,000 ton metric tons per annum by the end of January 2026. During nine months FY 2026, POCL invested around INR 25 crores in capital expenditure and expects to deploy additional INR 35 crores in the last quarter of FY 2026. POCL's board has approved the amalgamation of its wholly owned subsidiary, POCL Future Tech, into the parent company, subject to regulatory approvals. The merger strengthens vertical integration in plastic recycling, improves cost efficiency and cash flow management, and creates long-term value for POCL without any equity dilution or cash outflow. We have shifted POCL Future Tech from the leased premises to the Thervoykandigai facility during the quarter. The facility is now operational, and production has commenced in the facility. Coming to our operational performance. The procurement mix for nine-month period comprised approximately 70%, 59%, and 100% imports for lead, plastics, and copper. There is a significant increase in sales of copper by 15x on nine-month basis to INR 296 crores. The production of lead has increased by 23% year-on-year to 83,746 metric tons on a nine-month basis, at 57% year-on-year and 26% quarter-on-quarter to 33,271 metric tons on a quarterly basis. EBITDA per ton of lead increased significantly by 46% year-on-year to INR 18,086 per ton on a nine-month basis by 39%, and year-on-year to INR 17,427 per ton on a quarterly basis. Moving to financial performance. I would like to reiterate that POCL has continued to deliver consistent performance, resulting in its highest ever quarterly and nine-month revenue, EBITDA, and PAT. On a quarterly basis, revenue increased to INR 776 crore, up 22% quarter-on-quarter and 55% year-on-year on a nine-month basis. Revenues stood at INR 2,007 crores, reflecting a growth of 23%. This growth was driven by improved capacity utilization and higher sales volumes across both lead and copper segments. Export contributed 67% of total revenue reflecting POCL's growing global presence and customer confidence. On a nine-month basis, value-added products accounted for 65% of lead segment revenue, supporting the company's long-term target of achieving over 60% contribution from value-added products. EBITDA increased by 122% year-over-year to INR 59 crores on a quarterly basis and by 96% year-over-year to INR 157 crores on a nine-month basis. EBITDA margins remained strong at over 7% plus compared to over 5% in nine months FY 2025. PAT more than doubled on both quarterly and nine-month basis. On a quarterly basis, PAT increased by 148% year-over-year to INR 38 crore, while on a nine-month basis, PAT rose by 114% to INR 101 crores. On nine-month FY 2026, PAT margins improved by up to 5%, up from over 3% in nine-month FY 2025. On a consolidated basis, POCL reported strong performance with revenue, EBITDA, and PAT growing by 32%, 94%, 128% year-on-year respectively on a nine-month basis. On a quarterly basis, these metrics increased by 53%, 119%, and 167% year-on-year respectively. In conclusion, POCL remains aligned with its Target 2030 vision, supported by a clear roadmap focused on value creation and sustainable growth. The company continues to scale its lead and copper capacity while expanding into adjacent non-ferrous segments with an objective of delivering 20%+ volume growth and 20%+ CAGR in revenue and profitability. Growth will be supported by margin improvement, with a focus on maintaining EBITDA margins above 8% and ROC above 20%. Alongside scale and strategy emphasis, operational efficiency through innovation and modernization with a target of over 60% revenue contribution from value-added products and 20% plus reduction in energy consumption, backed by a net cash balance sheet, a disciplined execution, a supportive regulatory environment, extensive land bank, experienced leadership, and stakeholder support. POCL is well-positioned for long-term sustainable growth. That concludes my update. I'd now like to open the floor for questions. Thank you. Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on the touchtone telephone. If you wish to remove yourself from the questions queue you may press star and two. Participants are requested to use handset while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue is handled. The first question is from the line of Dheeraj Ram from BNK Securities. Please go ahead. Hi, sir. Thank you for taking up my question. Congratulations for a great set of numbers. Okay. My first question is based on, since you're ramping up your capacities in copper, which have lesser EBITDA margin compared to lead for 2027 and 2028. How do you see the EBITDA margin guidance that you have given of 8% on a consolidated basis? Hi, Dheeraj. Thank you for your question. We have always guided our margins to be in the range of 7%-8% EBITDA. These will continue as we are increasing the copper capacity as well, which is currently at a lower EBITDA range. We'll also be adding on products on copper, as explained in our earlier calls, which will also have higher margins. The blended margins will remain in the range of 7%-8%. Sir, what could be the range of copper EBITDA per ton, including once your 6,000 tons is expected to commence? I will not be able to give you specifics on those numbers right now, but we'll keep you updated as we announce the products. Got it, sir. Last question is, what is the volume sales of copper during Q3? Dheeraj, the volume sales for copper is about 1,235 metric ton for this quarter. Okay, sir. Okay. Do we think that this EBITDA per ton is going to continue for copper that we have logged in 3Q, or will it improve? Right now for the recycling, it is in the range of INR 35,000 per ton. Yeah, I'll put it this way, Dheeraj. The copper, as you are noticing, the whole copper market is going through extremely volatile phase. When any metal, which almost close to 40%, 45%, just shoots up in a vertical manner, overall industry, it takes a little bit of time and momentum for it to absorb these kind of price increases and which have to flow down eventually to the end consumers. There is always a slight margin shrink, and once these things start realigning and people start accepting these higher elevated prices, the margins start falling back into the regular ranges. That is the whole transitional period, which again, should be sustainable. Got it, sir. Thank you. Congratulations for the good result again. Thank you, Dheeraj. Thank you. We have the next question from the line of Sagar Shah from Spark Capital. Please go ahead. First of all, congratulations, sir, for excellent set of numbers. My first question was related to our utilization, actually. Can you tell me what is the utilization of the 32,000 tons per annum that you commissioned in Q1 and the 132,000 tons, which was the old capacity? What is the capacity utilization of 168,000 tons right now as of this nine months of FY 2026? Sagar, this is Vijay. Yes, sir. The net capacity utilization for this nine months ended, it's about 70%. For this quarter alone, it is about 79.2%. For copper, for nine months, about 74%. For this quarter alone, it's about 86.2% on overall basis, for this quarter. Okay. Basically, we are at that peak of the capacity as regards to 32,000 tons per annum, which is recently commissioned, right? 36,000, you were able to get those capacities only the last month of previous quarter. That's when it got commissioned. Okay. Basically, now the growth will be largely led by the new capacity, the 36,000 tons, which is just recently commissioned. More or less, yes. Coming on to this plastics one. The plastics one, actually, I see our capacity utilization coming down to almost 31%, and I understand that you are shifting your capacity to the new premises. As far as the demand is concerned, I wanted to understand that what exactly are we seeing there? How is the demand shaping up? From which industries, how are you placed up as far as FY 2027, FY 2028 is concerned? I think so that is the reason you are not increasing capacity also in that particular segment. Sagar, regarding if you see in the past also our quarterly capacities or the sales in terms of copper is about approximately 850 to 900 metric tons per quarter. Right the demand very soft. Going forward, the 800 metric tons probably could increase to 1,000 in the coming quarters. That is what our plan is. We'll be slowly looking at trying to build those volumes. Currently, what we saw in the last quarter, the whole market demand was pretty much on the softer side, along with softer prices. Off takes as well. Okay. This market was largely led by automotive or non-automotive, sir? It is a mixture of both automotive and non-automotive. Also largely a little bit led by the primary material price also coming down quite a bit in the domestic market. Okay. My last question, sir, was related to Mundra, most importantly, which we are actually waiting for. I saw your utilization proceeds also. You hardly are left with around INR 13 crore of money left from your QIP proceeds as well, and also from your pref allotment. Largely you have spent on the new capacity. I wanted an update at what exactly, or when exactly are you planning the expansion in Mundra? It's been almost two years since you have purchased that land, 123 acres. What's the progress in that land? What are you eyeing? What kind of plants are we getting there? Have you built the entire ecosystem? It's near to the port also. What is the actually thought process behind that expansion? That will be the major growth driver for POCL from now till in the years to come. Sagar, currently, as indicated earlier as well, we will be looking into Mundra only in 2027. That is, now once our copper expansions are completed by this last quarter of 2026, in 2027. Post that, the Mundra land capacity will be existing. Definitely, we'll be looking at the existing businesses that we have and also do some fresh business. Currently, our thought process is to have little more capacity of our existing lead and copper business in Mundra. Like you said, that having an advantage, also having better reachability and freights towards the European and Middle Eastern markets, that will also serve as a driver for us to enter those markets. Basically, are you referring to FY 2027 or calendar 2027, sir? I'm referring to second half of calendar year 2027. Calendar year It is- financial year FY 2027. No, I'm talking about the implementation. Okay. The thing is, in the free cash flow also, you're going to generate over INR 100 crore of free cash flow this year and also correspondingly next year. Yes I think you have lot of cash left also. Yes. I mean, even though we have used quite a bit of our QIP funds, all of those, every year we are generating cash surplus as well. These are going back into investments for our expansions and all of those. Okay. First of all, right now after this, your major focus will be towards the forward integration of the copper segment, the products that you are eyeing actually, which will be margin accretive, if I'm not wrong. Right? That's true. That's right. Okay. Sure. Thank you. Thank you so much, and all the best. Thank you. A reminder to all the participants, you may press star and one to ask questions. We have the next question from the line of Vikas Singh from ICICI Securities. Please go ahead. Good afternoon, sir. Thank you for the opportunity and congratulations on very good set of numbers. Sir, my first question pertains to the sourcing, given the commodity prices are kind of pretty volatile and actually moving in upward direction. Are we experiencing any problem with the sourcing because? Commodity prices are moving up vertically. Sourcing tends to become a little better because everybody wants to get rid of the scrap that's available to them, and they get higher price. That is actually technically a better scenario to source more scrap. As of now, no such problem we have faced in terms of sourcing. Sometimes the hoarding kicks in. People think that they would get a better pricing if they sell at a later stage. Nothing of that sort is happening, right? Let me see. What happens is every time now what will happen, if drastically price drops, people like I explained to Dheeraj in the initial part of the call also, when there's a sudden rise or a sudden drop, market pauses a bit to re-understand and realign, and then it gets back into the whole cycle. How long can anybody hold a material? Pockets are not continuously deep enough to keep hoarding material or keep waiting for the high or low side of it. This is a trade, so trade cycle has to resume. Definitely sometimes there is a pause in between and then the whole cycle starts resuming back again. Noted, sir. My second question pertains to our lead EBITDA per kg, if you could share that. Also, given that the prices are moving in copper as well as other segments, shall we assume that since the scrap is as a certain percentage basis, our EBITDA per kg in all these three segments is going to go up in the subsequent quarters? Irrespective of the price movements, our EBITDA per tons for lead will be in the range of, as we rightly in the past we said that INR 15,000-INR 17,500 is something what we have. It's a sustainable EBITDA per ton irrespective of the price mode. Even for copper as well, for last quarter, the per kg increase is about INR 100 per kg. That is why you can see a slight drop in your EBITDA percentage, but in terms of per ton basis, the amount remains at INR 35,000 plus, which we have already informed. Noted. We are not then baking in any improvement in overall per kg basis, right? The more the value addition in terms of, as Ashish said, in terms of copper, the EBITDA per metric ton will increase once the forward integration happens, which we'll do in the next financial year. Coming financial year. Coming financial year. Noted, sir. That's all from my side. Thank you. Thank you. We have the next question from the line of Sameesha from Nuvama Wealth. Please go ahead. Yeah. Hi, sir. Congratulations on a good set of numbers. My question was regarding copper's capacity. You said for this quarter, we've done 1,235 metric tons for copper. How much would be for nine months, sir? Nine months. Nine months, this overall volume is about 3,308 metric tons, out of which 6,000 is the overall capacity. If you take on an average basis, then the utilization is about 74%, pro rata basis. Okay. How much production can we expect for the coming year, FY 2027? FY 2027, we are targeting a minimum of 12,000 metric tons, but would be definitely higher than that. Sir, you'll be doubling your capacity to 12,000 tons for FY 2027, if I'm not mistaken. The capacity utilization, you're saying would be 100% for FY 2027. Through the year, also there are other capacity that are getting added. That will be a continual process. As of now, in this last quarter, the capacity that we are adding is relating to 10,000. We'll increase from six to 10. Okay. Could you be able to shed some light on how much capacity would be added in FY 2027 for copper? We'll be updating those in the future announcements that we have. Sure, sir. Thank you. Thank you so much for this. That's all from my side. Thank you. Thank you. Thank you. We have the next question from the line of Nihar Mehta from Bay Capital. Please go ahead. Hello. Yes, you're audible. Congratulations on this set of numbers. I just had a couple of questions. Your balance sheet size has significantly increased if I compare as on December end. What has led to the expansion of balance sheet size? There is an increase in the current assets. Typically, inventory has increased by about INR 75 crores. In terms of, there are some refunds that are expected from the government authorities, which is in the tune of about INR 75-80 crores. This has led to increase in our balance sheet numbers. What is the nature of refunds from government? This is regarding export with payment of duty, wherein we procure domestically. The IGST part of it, we claim as a refund from the government after paying the duty. Understood. Vijay sir, what's the cash on the books as on December end? It's about INR 35 crores. Understood. My second question is related to the employee cost. Now, if I see the size of the business has significantly increased, but Q1QR employee cost is on a downward trajectory. What exactly is the reason for this downward trajectory? It is not downward the same. Actually, in the second quarter, we paid increment for the employees with arrears. Along with incentives also, we paid for the last year performance, which is accounted on paid basis. Because of that, second quarter employee cost is comparatively higher than the third quarter employee cost. Understood. Thank you. That's it from my side. All the best. Thank you. We have the next question from the line of Khush Gosrani from Geojit P MS. Please go ahead. Yeah. Hi, sir. Hello. I am audible. Congratulations on the good set of numbers. Just wanted to understand your view on the aluminum side of the business. What are the numbers that we have done over nine months, and how should we look at going forward? Aluminum is not a segment that we are technically concentrating on specifically. There are not much of numbers that we are technically doing on the aluminum side. It is a very small number, which is about INR 7-10 crores, but that typically is not by doing the aluminum business. Actually, when you do a lot of scrap, you do generate some few other metals, so that gets just added on. Typically, there is no concentration as of now on aluminum at all. Got it, sir. How should we look at lead? Because capacity expansions have been announced by two, three players now. Is the demand still there? How should we look at the segment for next two, three years? I will not say the demand is explosive, but demand is consistent. For India, we are looking at anywhere between 5-6% of incremental demand and also the demand that comes from your regular replacement demand of existing batteries and vehicles. Internationally, about 2-3% is the growth. Got it. By FY 2028, what should be our net capacity with all the expansions that you have announced till now? As of now, our capacity is 204,000 tons. Once we are doing any further expansion, we'll make an announcement and keep you updated. Got it, sir. In Q4, you could see some margin pressure with the copper plant also coming up now, or it will be in Q1 with ramp up cost coming up? No, the margins are pretty similar. There was no margin pressure. It was more or less in similar lines of guidance of 7-8%, and we've achieved that. Got it. Okay. I'll get back in with you. Thank you. Thank you. We have the next question from the line of Naman Parmar from Niveshaay Investments. Please go ahead. Yeah, good afternoon, sir. Thank you so much for the opportunity. Firstly, I just wanted to understand what was the reason for decrease in the gross margin in the current quarter compared to the previous quarter. I will tell this as two prong. One is that if you see our procurement mix, last quarter is about 85% imports and 15% domestic. This quarter it has significantly increased to imports is about 70% and domestic is about 30%. There is a shift in the procurement mix. Apart from that, the value-added component, which was typically 70%, this quarter it has reduced to 55%. That is also one of the major reason why your margins have dropped. Despite these two factors, the EBITDA margin is still at seven. We have delivered the EBITDA margins 7%-7.5%. That is what we have already on a sustainable basis will be able to do it. You expect that the 13%, 14% that you used to do in the previous you will be able to catch up that particular margin in the coming quarters or years? We have not done 13%, 14%. We are talking about material margin. Material margin last quarter was of course 14.6%, but that also depends upon your product mix, your procurement mix. This is a commercial decision, sir. Overall, if you see due to volumes, you are able to get the advantage of our fixed cost. That is why we are able. Apart from that, we have operational efficiencies. Our new plant is in line. We have phase one and phase two is also live. All put together, we are confident that we'll be able to deliver EBITDA margins in the range of 7%-7.5% in lead. Absolute value of the profitability is increased considerably over the period. Okay. Understood. Secondly, on the press release that you have mentioned about the provision of the mark to market of INR 7.28 crore. I think it's related to any derivative contract that you have been hedging for. Just wanted to understand on the hedging part of your copper, basically. How is the whole contract you serving it? You used to fully hedge your copper prices or what is your strategy on that side? Yeah, we used to hedge our copper. Since the volume is increasing, 100% of our copper volumes are hedged. If you see from the last quarter to this quarter, there's consistent incremental volume. That mark to market difference of incremental volume is what is reflected back, which is currently a moving position. As the sales happen, those profitability keep coming in and the next positions keep coming in. When there's an increase in volume that much difference and the market has gone further above that, so there is a mark to market difference. It is a point of time figure as on 31st it is a particular effect, yeah. Yeah. In previous year quarter there was any such provision as of now or it was the first time that you have been making a provision for the market? Every quarter some provision we are making, but the amount will vary. This time it is a larger thing since the copper movement has been pretty vertical. Also a little bit mark to market on the rupee side as well. Okay, understood. Lastly, I just wanted to understand on the EBITDA per ton for the lead specifically. If you compare with the other players, they are doing very wonderfully high, above INR 20,000 per ton they are able to. Any chances that we can also achieve on that side given that we have a very good capability and value-added products fixing significantly? We will not be able to comment on other peers, sir. See, our thing is very simple. Whatever we have said, the EBITDA per ton will be in the range of INR 15,000-INR 17,500. In fact, if the value addition component increases, probably it will increase by INR 1,000 or INR 1,500 extra. This all depends. Once again, I'm reiterating, it depends upon your product mix, procurement, everything determines the number. Overall, like the promise of 7% to 8%, which will definitely be maintained. Okay. Understood. Thank you so much for your answers. Thank you. A reminder to all, you may press star and one to ask a question. We have the next question from the line of Mitul Patel from 360 ONE Asset. Please go ahead. Yeah, thank you for taking my question. Just on the lead, EBITDA per ton for this quarter, I understand that the new capacity had a lower share of value-added products. Is that the only reason why the EBITDA per ton this quarter was lower? Do we expect this value-add share to go back to Q2 levels and we should be around INR 19,000 per ton mark for Q4? There are two reasons. Definitely, yes, because the value-added product mix was slightly lower. That definitely did bring down a little bit of the margins. Apart from that, we had increased a bit of our domestic procurement on raw material as we want to slowly start sustaining our domestic procurement footprint, where the current domestic prices were little bit on the sharper side. That also led to a little reduction in the EBITDA per ton. Going forward, we are looking at this should be stabilized and should be in better numbers and should be able to achieve the high side again. Okay. Just on the fact that this mark-to-market, INR 1.28 crore, I think the gentleman earlier asked this question. If our sales increase, for example, if the sales in Q4 are up substantially for copper as well on volume basis, and the prices stay around similar levels or higher, then this reversal will not happen in Q4. It will take some time. Yes. It's not that specific manner the way you're looking at that every time there'll be a volume increase. It is a point in time when you hedge a particular quantum of metal and then from there, where the market moves, and when the sales happen, that gets reversed. It is a point-in-time moving figure. It's not necessarily that every time the volume increases, there will be a huge negative mark to market. Got it. Okay. Let's say this reverses, then this will show up, in what line item will this show up in? Again, same mark-to-market only. Okay. This is currently bringing down the profitability, right? Yeah, the profitability will get added up, yeah. Yeah. This is accounting standard requirements. That is not in our hand. That is to be accounted like that only. The moment it is converted, either it's a part of your sale or it's a part of your costing. Yeah, costing. Either material costing or MTM. That's all. Lastly, I think in your initial remarks, you mentioned that the EU FTA agreement is positive for you. I understand there is a lot of sourcing and selling that goes from Europe and into Europe. Considering what are the sort of duties that we are paying currently and what could be the benefit in terms of both procurement and selling for our business? What happens is the whole ecosystem starts opening up. Right now, when EU imported from India, there are customs duties and other import duties that they have. Going forward on metal specifically, they have indicated they will make it zero. That opens up as a very good and competitive market for Indian material to start flowing into EU. We definitely already have approvals with quite a few of the customers, but it was only opportunistic business when we are able to sell to them. Once these agreements and FTAs are in place, this should turn back into a sustainable long-term business. Apart from this also gives us one more good reason to look into the Mundra side of it, because operations from there towards the European side and the Middle Eastern side become much more feasible. On the procurement side, when you import scrap batteries, is that something that is sort of? Currently, you can't import batteries from EU region because they're not allowed to be exported to India from EU. Hoping that with these, because they do not have the recycling capacity and they are piling up the battery pack. Hoping with these agreements, maybe some EPAs or something could be done with them, and that could be another opportunity of sourcing. That we'll have to wait and see how it translates within a few coming months. Got it. Great. Thank you. Thank you, and best of luck for the coming quarter. Thank you. Thank you. We have the next question from the line of Kaushal Sharma from Equinox Capital Venture Private Limited. Please go ahead. Yeah. Hi, sir. Am I audible? Yes, sir. Yeah. Congratulations for good set of numbers, sir. Most of my question has been answered. Just last question on the working capital cycle. How is the working capital cycle going forward considering current expansion, and what is the sustainable inventory and sustainable days of business? Quarter-on-quarter working capital cycle has been we have set our own target and for the last quarter it's about 47 days. This is including lead as well as copper. We are seeing a substantial reduction of the working capital cycle. Moving forward, it is expected to sustain at this level. As for inventory, INR 230 crores- INR 250 crores will be a number which we can expect by year-end. What about receivable days, sir? Pardon? Receivable days. Receivable days, right now it is about 15 days. Okay. Sir, the last question on our copper side, could you please guide what is the current EBITDA margin per ton on our current production level? The current for nine months, it is about INR 34,361. For this particular quarter it's about INR 35,325. This is our EBITDA margin, right, sir? Yes. Okay, sir. Thank you very much for answering questions. Thank you, sir. Ladies and gentlemen, in order to ensure that the management will be able to address all the questions from the participants in this conference call, we request you to kindly limit your questions to two per participant. If you have a follow-up question, please rejoin the queue again. We have the next question from the line of Abhijit Mitra from Earnest Alpha Investment Management. Please go ahead. Jiya. Thanks for taking my question. Just to understand the nature of your value-added product sales that you report, typically it would mostly be OEM sales, right? Yes, that's right. This new capacity which has come up, which is essentially 132,000 going to 204,000, I mean, to sort of get OEM sales from this capacity is how long will it take, you feel? I mean, there should be a timeline to sort of place incremental volumes to OEMs coming out of these lines, right? Do you also think along these lines? There would be a period, right? Say one quarter, two quarter, three quarter. Basically for this in the first phase, which was 36,000 tons, which is already commissioned. For that, the value-added products orders have already been secured and those contracts start now, starting Jan, Feb, March for this financial year. Okay. We have some smaller options to take up little more volume, but I will not say 100% of that balance 36,000 tons volume in terms of value-added products, but definitely since we're already approved with them, we can try and expect and push for a little bit of volume increase on the value-added part as well. Got it. The incremental volumes that we are seeing quarter-over-quarter in Q3, we are seeing almost in terms of sales, 22,000 tons of additional sales coming in quarter-on-quarter in Q3 over Q2. Large part of that would not be OEM sales, right? Because those volumes wouldn't have gone to OEMs yet. No, quite a bit of that is to the OEMs as well, but it would be sometimes we route them through another channel that we have as well. I'll say about out of that incremental sales, almost 65% is to the OEMs. Interesting. Okay. If you're routing it say through Trafigura or other traders, then you will not get the volumes, right? We don't route it. I mean, you will not get the margin. Sorry, not volumes. You would not get the margins, 65% and above. It doesn't work that way. Our contracts are little differently done and not like our industry peers. We have a direct, I would say a direct contract where we route it through one or two of these traders, and we have certain pricing benefits. We have some other options that we work around. Okay. Lastly, just to end this thought process. Q4 over Q3, volumes will go up. Will value-added go up or you feel value-added will sort of stay the same with those higher volumes? Value-added will go up. We already secured a decent amount of volume orders. Okay. That means that there can be an uptick on the margin side, everything else remaining equal. We will maintain the guidance that we have given on all the margins. Okay, got it. Thanks. That's all from my side. Wish you all the best. Thank you, sir. Thank you. We have the next question from the line of Soumil from Lucky Investments. Please go ahead. Hello. I just want to understand the implications of a rising or a falling copper market on our EBITDA per ton and also on our balance sheet from that perspective. If there is either a vertical rise or a vertical fall in copper. Sir, could you repeat the question? It is a little unclear, sorry. Is it better now? Little bit, yes, please. Okay. I wanted to understand what would be the implications of any volatility in copper prices from both the P&L perspective, I think this has been alluded to, but if you could just repeat for my better understanding, and also from a balance sheet perspective. Inventory will change back up. Basically in terms of balance sheet, inventory is always at the purchase price. I mean, it is not this thing. The differentiate whenever you buy, there is a hedge position created, and the hedge position is what moves and that's where the mark to market comes in. Basically, the implied volatility does not change our, in terms of our procurement ways or the way the margin determines. Like I explained, suddenly when there's a vertical push up to this kind of extreme extent, which I would say this is a historical time when in the history of copper, this is the kind of run-up that's happened in such a short while. At that point in time, the market, like I said, pauses a little bit, resets the prices. At that point in time, there's a slight panic. Sometimes, the deltas shrink a bit. Again, eventually come back to the normal working position. Also a lot of consumers, you have to understand that everybody does not have a free working capital where they can absorb the 40% rise in working capital requirement and all of those. They also start operating at a little lesser volumes and quantity. That's the whole shift that happens. Eventually in two, three, six months, one or two quarters down the line, everything resets and restarts again. That's how the whole cycle works. In terms of EBITDA per tonne. Yeah. Go ahead, sorry. In terms of EBITDA per ton, irrespective of prices, we still maintain INR 35,000-INR 40,000. Yes. Okay. Okay. Now a follow-up on that. If your EBITDA per ton is going to stay sort of constant because of the hedging policy, as copper prices increase, that means a higher receivable cycle on a fixed or on a same EBITDA per ton, right? Is my understanding correct? That would be ROC diluted, if I understand correctly. See, not technically. There is in terms of absolute numbers, there would be a rise. Like you rightly said, the financing cost increases. Eventually when you look at it, the margin in terms of percentage profile starts coming back to the similar levels. Currently, the market is still digesting these rapid increase in prices, and hence there's a slight margin shrinkage. Of late from the January what we are looking at is market is realigning itself to the newer prices and market is getting to these as fresh levels and margins will be back in place. I would say it is a transitional period and the whole business destabilizes in the next one or two months. Sorry, a clarification on that. You mentioned that. Sorry to interrupt in between. Soumil, I would request you to kindly rejoin the queue for the follow-up questions as there are participants waiting for their turn. I just have a quick clarification I need to. Thank you very much. Thank you. We have the next question from the line of Shubham Thorat from Perpetua Capital Advisors. Please go ahead. Hello. Am I audible? Yes, you're audible. Thank you for the opportunity. First of all, I have three questions on the copper. I just wanted to know from where do we source our scrap for the copper and the geography that we source from. The second I just wanted to know was that when the 6,000 tons per annum incremental capacity for the copper will be live and how much are we spending for that. Third, what kind of forward integration are you looking to do in copper that you mentioned in order to improve the EBITDA per tonne? Thank you. See, on the copper side, our sourcing is again global in terms of multiple countries that we source from, U.S., South America, Australia, across the globe. We are sourcing wherever the scrap export is feasible and allowed to be exported to India. In terms of the capacity that you asked from 6,000- 12,000, we are almost at the end, and right as we speak, some trials are going on and these capacities should be live as soon as maybe the next two, three days. You will have those incremental capacities coming for the month of February and March. Apart from that, on the product side, I will not be able to give you the specifics right now because we will anyways give that out, what product, what it is in our announcement the moment we make it on our further expansions. This 12,000 tons, what we are talking is almost live as of now. How much CapEx are you giving on that copper rig? It is a moving CapEx. We'll be announcing that as well along with our larger plans on the project. As we told during my initial speech, we've already done INR 25 crores of CapEx in these nine months, and further approximately INR 35 crores will be done in this quarter. Okay. Second on the plastic division. I just wanted to know what product we deal in the plastic and what kind of EBITDA we generate there. What current capacity that we have in the plastic? Currently, on the plastic, we are considering more on the plastic that we are generating in-house for the batteries apart, which is PP, CP, and ABS. Apart from that, we are also looking at nylon. Currently, it is a very flattish number in terms of EBITDA and this thing, which slowly we'll be converting a little bit on the positive side. Okay. Again call. Sorry to interrupt in between. Yes, please. I would request you to please rejoin the queue again for the follow-up. Right. Thank you. We have the next question from the line of Utkarsh Somaiya from Elco Quantum Solutions Private Limited. Please go ahead. which you had this quarter that almost had a 1% impact on your EBITDA margin. I just wanted to know, you mentioned this is a recurring number, so will it also be recurring next quarter? What is the same number for Q2? Sir, yeah. The last part was unclear. You said 1% drop and then? On a INR 7 crores was the provisioning cost, right? In this quarter. Okay. What is the same expected to be in quarter three and the rest of the quarters ahead next? I'm sorry. I wish all of us knew that. We could stop manufacturing and just play the market based on understanding what the market would look like three months down the line. It's only a market phenomenon, sir. We definitely would not know what it could be in the future. It is only volume driven and at what price my purchase has come in and at what price it has been hedged at that point in time. Nobody I think can answer this question. Was it higher than normal this quarter because of the high volatility in prices? Not higher volatility in prices. Vertical one-way run-up when the products were bought at the lower level. When you hedge it at that level, the differentiation comes in as mark to market. When this gets sold, that mark to market gets reversed and comes back into the books as your sales numbers. What are the costs in Q2 for provisioning cost? Provisioning cost? Provisioning cost, the MTM is INR 2 crore. In quarter two, right? Yeah, quarter two. Thank you. Can I ask you one last question? Sure, sir. Would it be feasible for you to do an 8% EBITDA margin for FY 2027? We wish to do a lot better than that as well. As of now, how we look at the markets, we are sure about having it in the range of 7%-8%. Okay, thank you and best of luck. Thank you, sir. Thank you. A reminder to all the participants, kindly restrict the questions to two per participant. We have the next question from the line of Akshay Jugani from Exponent Thrive. Please go ahead. Yes. Exponent Thrive. Due to no response, we will take the next participant. We have the next question from the line of Pranav Jain from Atlas Capital Finance. Please go ahead. Hi, sir. Congratulations on the results. My first question was just a follow-up. Vijay Sir was saying we expect to end the year with an inventory of INR 220 crore, around INR 220 crore-INR 250 crore, which is similar to what we had last year in FY 2025 balance sheet. Just to understand, won't the copper prices going up optically increase your inventory number for the same amount of scrap that you're importing? Definitely what you're saying is the way you are looking at is in plain vanilla terms, very right. Also along with the inventory management, we are also trying and squeezing our working capital cycle and trying to rotate it more number of times with lesser number of days. I mean, we are looking at technically having lower inventory even though because the prices are going up and trying to manage the same lower working capital cycle. We are confident we should be able to achieve this. Good. The prices going up, they don't cause a challenge in sourcing because of which maintaining a lower inventory while it's good for the cycle, won't it cause you problems while sourcing or attaining your orders? No. I'll put it this way. Higher prices, the higher scrap prices is better for any seller to sell. I mean, if you had some scrap lying in your house versus six months back, now you will look for some copper scrap to sell out because you know the prices are one and a half times, two times than what it was six months back. Everybody, whether smaller or larger player would like to sell at these levels. Got it. I just want to understand your view on aluminum. I heard you said that you're not focusing on it, is there any particular reason why? The way copper prices are going up, the next closest alternative to that is aluminum and there is a good demand there as well. Why not look at it right now? The aluminum market typically in India and all of it is completely unhedged. I mean, it is more demand driven or more availability kind of driven, and it is not directly linked with LME. I mean, it becomes a little, how do I explain, little less rather organized manner of running a business. That is why we don't look at that in a very serious manner. The secondary aluminum alloys. Got it. Thank you. Those are my two questions. Thank you and all the best. Thank you. Thank you. We have the next question from the line of Nikhil Agarwal from Money Stories Asset Management. Please go ahead. Hello. Thank you for the opportunity, sir. Congratulations for the good set of numbers. I just wanted to ask your view on lithium ion. We are expanding on copper, lead, and everything. I just want to understand the rules and how we are approaching the lithium ion side of things. I mean, we have been contemplating on lithium ion. The reason that why we haven't forwarded, firstly, we are now currently concentrating on the copper part of it, number one. Number two, on lithium ion, basically, we aren't very sure of two things. One, the feedstock availability in the Indian market. Number two, we also expect kind of the technology up gradation, what is happening in lithium ion is quite fast-tracked. We just wanted to monitor that and understand the technology and the feedstock availability, because it mostly comes from the EV and the electronics, and both of it, and especially in EV, is the majority contributor. We foresee that probably by 2028 or so, the feedstock of lithium-ion batteries would be much better. We thought we'll take it later. That is the only thing. We are also exploring the technology part of it. Okay. Got it. As I assume, so for the next year, we don't see any lithium-ion part kicking in. Yeah. No. Okay. Got it. Thanks. Thank you. We have the next question from the line of Ashish Chauhan, an individual investor. Please go ahead. Sir, in the last three quarters, we have seen that our lead EBITDA per ton has been in the range of INR 17,000 to nearly INR 20,000 per ton. Now we are guiding between INR 15,000- INR 17,500. I was just wondering whether we had some different advantages in last three quarters, which are not going to be there going forward, that we are guiding towards the lower end between INR 15,000- INR 17,000. Mr. Chauhan, our guidance has always been INR 15,000- INR 17,500, and we are striving to have our margins over and above that. That is all about it. Typically, INR 15,000- INR 17,500 is a sustainable margin, and that is why we are continually guiding INR 15,000- INR 17,500, but yet achieving at those levels or higher than those levels. We would like to keep the guidance of INR 15,000- INR 17,500, even though we are achieving slightly over that. Right. With value-added products, you said it can go up by INR 1,000-INR 1,500, right? Yes. That's based on the mix. What we have guided, INR 15,000-INR 17,500, was a blended of value and this thing with the current mix that we've been having. A little bit of value-added mix increases, that margin also will definitely increase. Okay. For our Mundra, we already have a land, but we've not done anything. I know it's too early to comment, but what is management thinking at least directionally, how we want to utilize that land? I think a couple of queries back, I had answered the same question. I'll answer. We are looking at that in second half of calendar year 2027, once we complete our copper expansions. Like I said, by then, also looking into the Middle Eastern, European market, a lot of things open up. Definitely we'll be looking into our existing businesses and also at one or other verticals along with that in Mundra. Okay, great, sir. All the best. Thank you. Thank you. Thank you. We have the next follow-up question from the line of Khush Gosrani from Geojit PMS. Please go ahead. Yeah. Hi, sir. Could you elaborate on how the EPR norms are shaping up and the rebates, et cetera? That would be helpful. Thank you. EPR, the norms are yet to be. I mean, they are notified, but I'll say yet to be, it's a little bit still in the fluid state. Even though we have some credits in our book, the pricing is not yet evolved. We'll have to wait till the April first when the government is enforcing it in a stronger manner along with price mandates. We'll have a better clarity in the next quarter. Got it. Thank you. Thank you. Thank you. We have the next follow-up question from the line of Soumil from Lucky Investments. Please go ahead. Hi. Thank you for the follow-up. Am I audible? Yes, sir. Yeah. Just wanted to clarify one thing. You mentioned that over shorter cycles, your EBITDA per ton remains fixed because of the hedging policy. As the market calibrates to either higher or lower metal prices, specifically copper, that would mean that the market readjusts to a similar fixed%, right? Otherwise, your balance sheet would look very different, or rather, return metrics would look very different in case of high volatility on either side in the copper prices. Is that understanding correct? Yeah. Basically, you're more or less right on that side. Typically, once the prices adjust, then people, again, the basic margin requirement for doing a particular business is needed. People start readjusting and all of it. Like I said, sometimes when the market suddenly shoots up, there's a panic sale or somebody has a hedge position at the lower side. For them, it's still a much higher margin, they liquidate. Once all this finds a plateau, the market readjusts and comes back to the normal positioning. Got it. Because you are hedged in the interim, that would not affect. Yeah. Because when they are hedged. not severely. Yeah, not severely, but it did get affected a bit in this quarter because when the pricing vertically shot up, people were not willing to pay the complete delta that we were receiving the previous quarter. There's a marginal difference in the delta received this quarter. Coming quarter, that will even out. That makes it clear. Thank you, sir. Thank you. Thank you. We have the next follow-up question from the line of Shubham Thorat from Perpetua Capital Advisors. Please go ahead. Yeah. Thank you for the follow-up. Sir, earlier in the call, you mentioned that gross margins were impacted due to higher percentage of domestic sourcing. I just wanted to ask, why are imported scrap is more economical? That's one. Second, why are domestic sourcing more higher for this particular quarter? Domestic sourcing sometimes is higher because it's more of the availability phenomenon. When little more scrapping happens, little more vehicle sales happen, or change in trends changes, the flow is better. Sometimes when the flow is more lean, the domestic prices tend to squeeze up a little and more people are seeking for scrap and the availability is low. It's more of a market-driven formula. Also you have to understand that for us to look into the domestic market, we are extremely picky about taking it more only from the formal sector, from the larger companies or the IT companies, those kind of things are options. There, typically, slightly, the costs are higher. Got it. Sir, my final question on the lead side. I just wanted to know what is our current lead capacity, what is our capacity over there, and what kind of value-added product do we produce in the lead? Your question is what kind of value-added products we manufacture? I'm a little unclear on your question, sorry. Yeah, that's right. That's right. There are multiple kinds of alloys that we do. We do lead tin-based alloys, we do tin-based alloys, we do antimony-based alloys, calcium. Well, there's a lot of specific alloys that we manufacture for certain OEMs. It's a blend of alloys. We do almost close to over 100 kinds of alloys for various customers. It's a whole lot of plethora of portfolio that we give to our OEMs. Comments on your current capacity and what kind of capacity are you looking over in the lead? The capacity for this quarter, we have done about 79%. Overall for this year it's about 65%-70% capacity utilization. In the new plant, we expect capacity utilization, blended manner, about 70% in the coming quarters. Thank you. Ladies and gentlemen, that was the last question for today. I now hand the conference over to the management for the closing comments. Thank you. Over to you, sir. Thank you everyone for participating in this call. We trust that we have addressed all your queries during this session. However, if there are any remaining questions, please feel free to reach out to our investor relations team at Go India Advisors. Once again, we extend our gratitude to all the participants for joining us today. Thank you and have a great day. Thank you very much. On behalf of Pondy Oxides and Chemicals Limited and Go India Advisors, that concludes this conference. Thank you for joining with us today, and you may now disconnect your lines. Thank you, everyone.