Ladies and gentlemen, good day and welcome to the Q1 FY 2026 earnings conference call of Carborundum Universal Limited, hosted by Equirus Securities. 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 ring the operator by pressing *10 on your dash and phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Harshit Peri from Equirus Securities. Thank you, and over to you, sir. Hello, good afternoon, everyone. On behalf of Equirus Securities, I welcome you all to the first quarter FY 2026 earnings conference call of Carborundum Universal. We have with us from the management, Mr. Sridharan Rangarajan, Managing Director; Mr. Sushil Bendale, Chief Financial Officer; and Mr. G. Chandramouli, Advisor. I would like to hand over to Mr. Sridharan Rangarajan, Managing Director, for the opening remarks, and post that, we will open the closing remarks. Over to you, sir. Good afternoon. I'm Chandramouli. As a practice, let me read out the disclaimers before getting into the call. Good afternoon. During the call, we will make certain statements which reflect our outlook for the future or which could be construed as a forward-looking statement. These statements are based on management's current expectations and are associated with uncertainties, and risks are more fully detailed in our annual report, which may cause the actual result to differ. Hence, these statements must be reviewed in conjunction with the risks that the company faces. Thank you. That's important. Good afternoon to all of you and a warm welcome to our first quarter earnings call. I will give an overview, and then we will open up for question and answers. To start with, consolidated sales for the quarter were INR 1,207 crores in comparison to INR 1,184 crores Q1 FY 2025, which is a 1.9% growth compared to the same period last year, and 0.6% compared to Q4 FY 2025 of INR 1,199 crores. Standalone sales were INR 698 crores compared to INR 664 crores in Q1 FY 2025. This represents a growth of 5.2%. In comparison to Q4 FY 2025, that represents a growth of 1.7%. In Q1 FY 2026, consolidated PAT declined by 45.2% compared to Q1 FY 2025. This is from INR 113 crores in Q1 FY 2025 to INR 62 crores in Q1 FY 2026. This is due to the lower volumes in VAW, which we have explained in the last call itself, and RHODIUS and domestic businesses. I will explain all of this in detail a little later. In Q1 FY 2026, standalone PAT of INR 145 crores grew by 55.4% from INR 93 crores in Q1 FY 2025. The increase is due to a one-time dividend from SEDCO, which is about INR 68 crores. Now, I'll cover the consolidated performance. As stated earlier, the consolidated sales for the quarter were INR 1,207 crores with a growth of 1.9% compared to Q1 FY 2025. Compared to Q4 FY 2025, it is a 0.6% growth. Softer growth at consolidated level was mainly on account of RHODIUS. RHODIUS, as such, is making a change in their logistics partner, which caused a substantial drop in volume. I'll cover that in the RHODIUS section separately. The drop in volumes at VAW, which we have earlier explained in our Q4 last year's call itself, and they are actually trading as per the business plan, and they are fine as well. I mean, at a lower level, of course, they are at a lower level, but they are trading as per the business plan. You would note that the Ceramics segment grew by 11.1% and Electro Minerals by 6.3%, while Abrasives declined by 8%. Consolidated PAT for the quarter was INR 62 crores. This, in comparison to Q1 FY 2025 PAT of INR 113 crores, is lower by INR 51 crores. The lower profit is due to higher losses in VAW in comparison to last year's Q1. If you would recall that in January 2024, we had the sanction, and that is what you know we had these challenges coming forth. This, coupled with the drop in profit in RHODIUS and the standalone businesses, put together accounts for this difference. Roughly, you can say INR 18, INR 18, INR 18 crores broadly. Consolidated PAT for the quarter at INR 62 crores in comparison to Q4 FY 2025 PAT of INR 29 crores grew by INR 33 crores. This is predominantly due to the reversal of deferred tax asset at AWUKO in Q4 FY 2025. If you remember that we had reversed the deferred tax asset that what we claimed so far in Q4 FY 2025. Standalone business in Q1 FY 2026, standalone sales was INR 698 crores, which is a growth of 5.2% compared to INR 664 crores Q1 FY 2025. This was contributed by growth in Electro Minerals at 12.3% and Ceramics at 10%. Standalone Abrasive business grew by 5.5%. Standalone profit after tax for the quarter was INR 145 crores as against INR 93 crores in Q1 FY 2025. This is higher by INR 52 crores compared to INR 61 crores in Q4 FY 2025. PAT of Q1 FY 2026 is higher by INR 84 crores. I think this is due to a one-time dividend of INR 68 crores from SEDCO. Now, I will cover the segmental performance. To start with, in abrasives, consolidated abrasives sales in Q1 FY 2026 was INR 508 crores. This, in comparison to Q1 FY 2025 sales of INR 552 crores, has declined by INR 44 crores. There is an 8% decline. RHODIUS Abrasives declined by INR 26 crores, and standalone declined by 7. Together is this fall. Consolidated sales in Q1 FY 2026 at INR 508 crores in comparison to INR 538 crores in Q4 FY 2025 showed a decline of INR 30.5 crores. This is mainly coming from RHODIUS Abrasives. At standalone abrasives, sales for Q1 FY 2026 was INR 286 crores. Last year, Q1 FY 2025 sales was INR 303 crores, resulting in a decline of INR 17 crores, which is 5.5%. Precision segment grew well. We are seeing softer demand in the channels due to the inventory correction. As far as RHODIUS is concerned, RHODIUS recorded sales of EUR 13.2 million in this quarter compared to EUR 17.3 million during Q1 FY 2025. There's a 23% decline in sales. RHODIUS has shifted its logistics partner in Q1 FY 2026 for better efficiency. This resulted in a significant disruption of operation. This resulted in non-fulfillment of orders on hand, resulting in lower sales. We expect the stability of operation to come by the end of August. We expect this would impact the full year's sales as well. We expect the remaining three quarters' sales would be in line with last year's sales. RHODIUS incurred a loss after tax of EUR 1.6 million in this quarter against the PAT of EUR 0.3 million in Q1 FY 2025. This was mainly due to the loss of sales arising out of the logistics issues. AWUKO achieved sales of EUR 2.6 million this quarter in comparison to EUR 3 million in Q1 FY 2025. The loss before tax is far on the same level as that of Q1 FY 2025. I'll cover the PBIT performance of the Abrasives business segment. Consolidated Abrasives PBIT was INR 11 crores. In Q1 FY 2025, it was INR 55 crores, and in Q4 FY 2025, it was INR 34 crores. The drop of INR 44 crores in Q1 FY 2026 compared to Q1 FY 2025 is due to RHODIUS Abrasives amounting to INR 26 crores, entirely due to loss of sales. Standalone drop of about INR 16 crores. Consolidated PBIT of Q1 FY 2026 was lower by INR 22 crores in comparison to PBIT of INR 34 crores in Q4 FY 2025. This is mainly due to RHODIUS Abrasives and standalone Abrasives. I'll move to the next segment now. Electro Minerals. Consolidated sales in Q1 FY 2026 was INR 405 crores, showing a growth of 6.3% compared to Q1 FY 2025 of INR 381 crores. Standalone business showed a good growth of 12.3% compared to Q1 FY 2025. The performance of VAW was lower due to the sanctions imposed in Q4 FY 2025. However, consolidated sales in Q1 FY 2026 was at INR 405 crores, was higher by INR 30 crores when compared to INR 375 crores of Q4 FY 2025. This is mainly due to better performance in standalone, slightly better performance in VAW, etc. Standalone Electro Minerals sales for Q1 FY 2026 were INR 212 crores, with a growth of 12.3% compared to Q1 FY 2025 of INR 189 crores. Standalone sales in Q1 FY 2026 at INR 212 crores was higher by INR 7 crores when compared to INR 206 crores in Q4 FY 2025. This was on account of increase in volume as well as price. Standalone Electro Minerals saw good growth from export as well as domestic. VAW sales for Q1 FY 2026 was RUB 1.84 billion, which is a 25% decline from INR 2.46 billion in Q1 FY 2025. Sales for Q1 FY 2026 was RUB 1.84 billion, which is flat compared to INR 1.83 billion in Q4 FY 2025. In Q1 FY 2026, in rouble terms, the profit after tax was RUB 72 million as compared to RUB 287 million in Q1 FY 2025 and RUB 110 million in Q4 FY 2025. Ceramics sales for Q1 FY 2026 was INR 56 crores, which is a 3.7% increase as compared to Q1 FY 2025 of INR 54 crores, and INR 6 crores higher than INR 50 crores in Q4 FY 2025. In Q1 FY 2026, FSR incurred a loss before tax of INR 8 crores as compared to INR 5 crores in Q1 FY 2025 and INR 7 crores in FY 2025. Now, I'll cover the PBIT of Electro Minerals segment. Consolidated Electro Minerals PBIT for Q1 FY 2026 was INR 4 crores. In Q1 FY 2025, the PBIT was INR 43 crores. The drop of INR 39 crores in Q1 FY 2026 compared to Q1 FY 2025 is due to VAW amounting to INR 27 crores, standalone business amounting to INR 9 crores, and Foster amounting to INR 3 crores. Consolidated PBIT of INR 4.4 crores in Q1 FY 2026 was lower by INR 2.6 crores in comparison to PBIT of INR 9 crores in Q4 FY 2025. Ceramics, consolidated sales in Q1 FY 2026 was INR 300 crore, showing a growth of 11.1% compared to Q1 FY 2025 of INR 270 crore. Standalone business showed good growth of 10% compared to Q1 FY 2025. Consolidated sales in Q1 FY 2026 at INR 300 crore was higher by INR 3 crore compared to INR 270 crore in Q4 FY 2025. Standalone ceramics sales for Q1 FY 2026 was at INR 238 crore, with a growth of 10% compared to Q1 FY 2025 of INR 217 crore, which was higher by INR 9 crore when compared to INR 229 crore sales in Q4 FY 2025. This was on account of increase in volume price in industrial ceramic business, metalized ceramics, and engineered ceramics both growth, and refractory, small, lithic, and corrosion resistant business grew as well. Now, turning to the PBIT performance of ceramic segment, consolidated ceramic PBIT for Q1 FY 2026 was INR 75 crore with a growth of 16% as compared to INR 65 crore of Q1 FY 2025. Compared to INR 74 crore in Q4 FY 2025, the PBIT grew by 1.5%. Standalone ceramic PBIT for Q1 FY 2026 was INR 62 crore with a growth of 25.4% compared to INR 49 crore of Q1 FY 2025. In comparison to Q4 FY 2025 of INR 55 crore, the PBIT grew by 13%. I'll request Sushil to cover the PBIT margin, debt positions, CapEx, cash flow, and the ROC assets. Thank you. The consolidated PAT margin was at 6.7% for the quarter compared to 8% in Q4 FY 2025 and 12.6% in Q1 of FY 2025. Standalone for the quarter, standalone PBIT margin was at 23.8% compared to 11.8% in Q4 of FY 2025 and 18% in Q1 FY 2025. This also includes the one-off dividend income from SEDCO. Now, abrasives for the quarter, consolidated abrasives margin declined from 10% in Q1 of FY 2025 to 5.2% in Q1 FY 2026 due to a drop in volumes at RHODIUS and the standalone business. Standalone margins dropped from 17.6% to 13.1%. The drop in margin was mainly due to drop in volume and increase of freight and fixed costs. The consolidated margins declined by 398 basis points compared to Q4 of FY 2025. Standalone margins declined from 16.2% in Q4 of FY 2025 to 13.1% in Q1 of FY 2026. For electro minerals, for the quarter, consolidated electro minerals margins declined from 11.4% in Q1 of FY 2025 to 1.1% in Q1 of FY 2026. The decline was mainly attributable to the lower volumes in VAW coupled with lower realization. Standalone margins dropped from 8.5% to 3.3%. This is mainly due to higher input costs. The consolidated margins declined by 132 basis points compared to Q4 of FY 2025. Standalone margins improved from 2.8% in Q4 of FY 2025 to 3.3% in Q1 of FY 2026. Now, ceramics for the quarter, consolidated ceramics margins improved from 24% in Q1 of FY 2025 to 25% in Q1 FY 2026. The standalone margins improved from 22.7% to 25.9%. The consolidated margins increased by 10 basis points compared to Q4 of FY 2025. Standalone margins improved from 23.9% in Q4 of FY 2025 to 25.9% in Q1 FY 2026. Now, I'll talk about the debt position. There was no debt in our standalone books, and total debt at the consolidated basis was at INR 172 crore at the end of Q1 FY 2026 compared to INR 120 crore at the end of Q4 FY 2025 and INR 112 crore at the end of Q1 FY 2025. The debt-to-equity ratio was at 0.05 at the consolidated level. In Q1 FY 2026, our CapEx investment was INR 64 crore against INR 63 crore in Q1 FY 2025 at a consolidated level. Free cash flows in Q1 of FY 2026 at a consolidated level were 98% to PAT compared to 37% in Q1 of FY 2025. At a standalone basis in Q1 FY 2026, free cash flow to PAT was 104% compared to 47% in Q1 of FY 2025. Now, for ROCE for Q1 of FY 2026, the ROCE at a consolidated level is 8.1% compared to 16.9% during Q1 of FY 2025, and at a standalone level, it was at 24.6% compared to 20% in Q1 of FY 2025. For consolidated segments, ROCE in Q1 FY 2026 for abrasives decreased from 15.5% in Q1 of FY 2025 to 2.8% this quarter. Ceramics has decreased from 41.5% to 37.8%, and electro minerals has decreased from 17.8% to 1.8%. For our standalone businesses, ROCE in Q1 of FY 2026 for abrasives has decreased from 45.4% to 26.3% this quarter, and ceramics has improved from 44.5% to 47.2%, and electro minerals has decreased from 22.3% to 8.4%. Now, the unallocable expenses net of income, standalone at the standalone level, unallocable expenses in Q1 of FY 2026 was an income of INR 60 crore. If you exclude one-time dividend from SEDCO of INR 68 crore, this would be an expense of INR 7.3 crore. In Q1 of FY 2025, the unallocable income was INR 0.72 lakhs, and the difference is due to lower dividend in few companies in Q1 FY 2026. In Q4 of FY 2025, the unallocable expense was INR 26 crore due to seasonality in dividend receipts. Now, I request Mr. Sridharan to take you through the next section related to the future outlook. Thank you. Just to summarize, I think ceramics sales, we communicated a sales growth of 16% - 18% last time, the full year level at consolidated, and we hold our guidance for the consolidated ceramics segment. EMD sales, we gave a guidance of 1%- 2% growth in electro minerals division. Last call, we retained the same guidance. Abrasives sales, in our last call, we communicated 5%- 6% for the year. This could be about 4%- 5% considering the lower sales in RHODIUS Abrasives in Q1 FY 2026. Overall, last time we said 6%- 7%. We are now looking at 5.5%- 6.5%. Consolidated margin in the ceramics section, last call we communicated PAT margin of 23.5%- 23.7%. On a full year basis, we maintained the same. EMD, in the last call, we said 6.5%- 7.5% on a full year basis. We currently look at 4.5%- 5.5%. Abrasives, last time we said the PBIT margin could be 8% to 8.5% on a full year basis. Currently, we are looking at 6% to 6.5%. We said that last time the overall consolidated PBIT margin could be a drop of 100- 150 basis points compared to FY 2025 base of 11.2%. Now, we are looking at 250- 300 basis point drop compared to that level. Just to summarize, I think, one, RHODIUS transfer of logistics partner issue is quite an unexpected one, and we did not consider in our forecast. There is a complete chaos in terms of software breakdown, physical movement of goods was impacted. We are trying to address this. We expect end of August, all this will be addressed. We expect that the rest of the quarter, the sales will be in line with last year. In EMD, standalone, the margins drop is due to higher aluminum costs, which I think is now passed on because the inventory, whatever we had, was completely liquidated. They are back to normal, and that should get us back to the proper margin that we were gaining. Besides these two, I think the major challenge was the abrasives local India drop, which we also feel that we will get back from Q2 onwards. With that, of course, you have seen that our free cash flow is in good shape. We have delivered the 100%+ in standalone, a very healthy free cash flow in consolidated. Balance sheet is quite strong. We have done all our programs as well as the long-term strategies that we are tracking very well. Those are in good shape. We will address these one-off bits that we will come back strongly in the coming quarter. Thank you. Thank you very much. We will begin the question and answer session. Anyone who wishes to ask a question may press star and one on the dashboard telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use hands up while asking a question. Ladies and gentlemen, we'll wait for a moment while the question queue assembles. The first question is from the line of Bhavin Vithlani from SBI Fund Management. Please go ahead. Good afternoon, sir. Good afternoon, Bhavin. Sir, three questions, but the first is on VAW. Sir, could you help us understand the way forward, given that now we almost have six months to accept the sanctions? What is your thought process in mitigating and how do we get back to normal? You said three questions, or I answer only one? Okay. I'll outline. Second is in the domestic abrasive segments, if you could give us a bit more color on where are we seeing slowdown, given that we have three segments that you outlined. One is the retail, another is industrial, and third is the precision. Where exactly is the impact? Optically, it looks the precision is it, and hence the margins have got lower. More color here will be helpful. Third is, if you could just help us understand on the German subsidiaries, what is the one-off that was there in the quarter? How do you see these two, RHODIUS and AWUKO, on the balance nine-month period and the full year basis, excluding this? I mean, what should be the revenue and profitability in the balance nine-month period? These are my three questions, sir. Right. Thank you. As far as VAW is concerned, I think we broadly guided last time that we expect the volume should be lower 25%- 30%. In the last call, we have guided that. This time, also, they are lower by about 25% compared to the same period last year. We are restricted to selling only inside Russia. We are continuing to do that. They are profitable within that set of the business. The future depends on how the settlement as far as Russia-Ukraine is concerned will turn out. Based on that, developments will happen. I don't want to hesitate a guess, given that multiple forces are at play. As far as the abrasives segment is concerned, you're right, there are three broad segments. We have precision, we have industrial, and we also have retail. The challenge that currently we are facing is on the retail side. As I was telling, there is a reasonable growth in the rest of the segment, which is what is making us confident about it. Quite a few major distributors have to focus on their stock clearance, and that is what caused this decline in sales. As far as the German subsidiary RHODIUS is concerned, as I told, this quarter we had lost about EUR 4 million compared to the end period last year. We expect that the remaining three quarters we will be in line with last year's sales. What we have lost, we will not be able to recover. Meaning this order we will sell. That That is the thing. Since there's a significant delay that has happened, we expect that we will not be able to recover. Of course, we are trying our best to see how do we sell this order as well as be able to sell the future orders. The issue is largely in terms of the change of software caused a significant delay, which is one major reason. If their pick and pack, we were not able to perform. We could not physically move the inventory from the previous warehouse to the new warehouse. Even in the new warehouse, we were not able to have a proper location. These are outsourced warehouses. This caused quite a bit of a challenge. It's getting addressed. We expect end of this month we will completely address this issue. Sir, just one more question, a bookkeeping question. Employee expenses for the consolidated pay are up by 24%. If I look at the subsidiary fees, which is minus the standalone, they are up by a little over 30%. If you could just help us understand here. Sure. I will get back to you with those answers. Can you move on to the other question? In the meantime, I will try to find the answer. Sure, sir. Thank you so much. Thank you. Thanks. Thank you. The next question is from the line of Ravi Swaminathan from Avendus Spark. Please go ahead. Hi, sir. Thanks for taking my question. My first question is with respect to the standalone Electro Minerals business. The margins are kind of still on the compressed side. You had mentioned that it was because of raw material prices going up, and now we are passing it on. Earlier, you had mentioned that there was also competition from Chinese players, especially in alumina, etc. What is the status with respect to the competition from Chinese players in this particular category? That is my first question. The second one, in terms of the other option value kind of products like high-purity silicon carbide and supply of ceramics to emerging product categories like EVs, etc., what is the status of that? Thank you, Mr. Ravi Swaminathan. First of all, as far as the electro minerals is concerned, the aluminum price literally went up. In the six months, it doubled. It went up as high as about $800, and then it fell down to $350 per ton. The inventories that we held because we bought this at a higher price had to be liquidated, and that is what is causing us this problem that we have in Q1. The price pressure continues to be there. We don't see there's anything new, but that is a continuing aspect. As far as the high-purity silicon carbide program, it is progressing well on track, and we are progressing on some of this qualification process. We are progressing on track. As I gave it, it won't be a major sales for this year, and we are not looking at an immediate short-term type of revenue arising from that. With respect to ceramic sales for EVs and semiconductor industry, is that a big driver of growth, likely to be a big driver of growth over the next one, two years, or three years? Right. You are right. I think that's the good driver of the growth, and that is also one of the reasons why we have a very good growth in the ceramics segment at this point in time. Okay. Within ceramics and refractory, one last question. With respect to gas ceramics, the technical ceramics, metallized cylinder, and refractories, if you can break up the growth, how it was in the overall 10% growth that we have seen this quarter, which is growing faster, which is seeing better traction, if you can give even a kind of a broad commentary or color on it, that would be great. Yeah. I think we are seeing our engineered ceramics business, metallized ceramics business are growing well. We are also seeing monolithic business growing well, quite decent. They're also seeing our corrosion resistance business growing well. There are a few softness in terms of wherever projects are getting executed. That is where there are some delays in that. That is why some of the expected projects, there is some delay. Otherwise, the business overall are doing well. Projects would be which end-user industries, sir? We typically sell to many industries: carbon, black, cement, steel, refractory products fall into many industries. That happens to diversified industries. Understood, sir. Thank you. All right. Thank you, Ravi. Thank you. The next question is from the line of Harshit Patel from Equirus Securities. Please go ahead. Thank you very much for the opportunity, sir. Sir, firstly, on the U.S. tariffs, what would be the impact on our abrasives-ceramic exports? Because we export quite a substantial amount to North America in this. Could there be a substantial impact on our supplies to that clean energy customer in the U.S. from where we have started seeing some pickup from CY 2025 onwards? Yeah. Thank you, Harshit. See, we see this so far, it is evolving. I won't call it we have any conclusive answers on this. As you would know, the world itself is just grappling with this. We do not know what is the final outcome going to be. What I can see is that broadly, it is a function of a few things, which I want to lay out here. Are there equivalents available getting manufactured in the U.S.? Are there equivalents available from other countries? How fast is the process of qualification going to take place? Also, suitability for the manufacturer to adopt to their new supplier. It is a function of what is the differential duty versus what we can absorb, and the ability of the three parties to share this difference, whether it is the customer or the intermediary manufacturer in the U.S. and the customer, the supplier from India. These are the parties who are going to deal with this. Plus, of course, there are other factors like what the Indian government is going to provide as support for those factors. I would say at this stage, we do not have any immediate threat or any issues that we foresee. We have made reasonable examination of all these factors that I laid out. I would like to get to a full picture to understand what exactly would be the impact on this. We seem to be in a decent position. Understood. My second question is on the CapEx. What are our CapEx plans for the next two years, FY 2026 as well as FY 2027, across all three of our major segments? I think you have highlighted doing some CapEx for fused aluminum-based products in Electro Minerals, supplying to the semiconductor OEM equipment from ceramics, doing bulletproof armor, as well as vehicle armor-related products. If you could highlight all the area and quantum across all three major segments, that will be very helpful. Yeah. As we don't normally provide that kind of a guidance, I think if I remember, it is about INR 350 crore was the CapEx program that we guided last year, sorry, last call, that we would spend for this year. We are sticking to the same one, and all the programs are in line with that. Understood, sir. Thank you very much for answering my questions and all the very best. Thank you, Harshit. Thank you. The next question is from the line of Mohit Kumar from ICICI Securities. Please go ahead. Good afternoon, and thanks for the opportunity. One question I have. On the standalone abrasives, is the industry not growing? Is it the demand or competition? Any color on that will be helpful, sir. See, I would say industry is growing. I don't think there's a decline in the industry. Definitely, there is a growth in the industry. Of course, you have the other published players. You are very much aware about that. What is the kind of results that we are getting in that? More or less comparable. There are minor variations here and there. I feel the industry is growing. As I have laid out in the last call also, we feel that there are segments where today products getting imported and coming into India are growing substantially high. Definitely, overall growth in the abrasives sector is growing. We have a specific challenge of our major distributors, particularly stock clearance and their own credit locks, those mechanisms. Other than that, I won't say that the challenge is industry-led. Understood, sir. Thank you. Understood. Thank you. Thank you. Thank you. A reminder to all the participants, you may press star and one to ask questions. The next question is from the line of Bhoomika Nair from DAM Capital. Please go ahead. Yeah. Good afternoon, sir. Sir, my first question is on VAW. It's been a tough quarter. You spoke about the 25%, 30% kind of decline. If I look at the revenue numbers, the consol minus standalone, it seems to be fairly stable. Can you explain why we're seeing the revenues being stable? If you can call out the VAW loss during the quarter. Sorry, what was the last part of the question? The loss at VAW, sir, at Russia? I think your question is that consol minus standalone is stable is what your observation, if I understood correctly. In EMD, yes, in EMD. Right. I think that you are very good in your observation because I think we source product from VAW and then use that product, which got stopped. What happened? The elimination of, we actually show the sales outside only to the customer. That is what is the total sales that we do. Since that has stopped, hence the elimination has come down. You see a flat number. That is what you have observed, which is the right observation. Per se, the sales of VAW have come down, which is in line with what we have guided. The second question you asked is the margin on the EMD, right? Yes. Yes. EMD losses, let's hold on. Sorry, you continue your question. I will gather and come back. Sorry. Okay, sir. If you can get back to the, you know, what is the quarterly revenue and profit at VAW, that would help. Second is in terms of. We shared that. Just give me a second. Sure, sir. In the meanwhile, we were looking to commission an HP SIC plant, so data or the history of. Sorry, just a second. VAW sales was RUB 1.84 billion in Q1 FY 2026 compared to RUB 2.46 billion in the same period last year, Q1 FY 2026. That was the number that we shared. Yeah. In rouble terms, the profit after tax was RUB 72 million as compared to RUB 287 million and RUB 110 million in Q4 FY 2025. These are the numbers we read. Yeah. Please go ahead, Bhoomika. Hello? Sorry, if you can move the queue. Okay. A reminder to all the participants, you may press star and one to ask questions. The next question is from the line of Bhoomika Nair from DAM Capital. Please go ahead. Yes, sir. Can you hear me? Yeah, we can hear you. I don't know where we got dropped, but I was just telling that you were able to get it or? I got it. I got that, sir. I got that. Okay. question was on HP SIC. You know, we had this pilot plan to be operational at the end of the calendar year. What is the status of that, and how are we seeing the progress in terms of the client uptake and things like that? We are very much on target as far as the HP SIC pilot client is concerned. As I told in the previous question also, our samples that we are working with various clients have been seeded. They're in the process of testing, very much on target. I just want to repeat the same thing I told in the earlier answer. We do not expect any huge sales arising from HP SIC business in this year or in the near-term future. Okay, sir. The next question is on the RHODIUS segment, part of the business which you're calling. There were some logistics-related challenges which impacted the ability to kind of drive revenues. We expect that, you know, from September onwards, it will kind of normalize. If I take a step back, it's been about three to four years since you've taken over RHODIU. If you can just help us understand what has been the benefit, how are we seeing the profitability and the revenues kind of grow out there? There is a PPA impact, which I do understand, but how do we see the turnaround at the console level for the international subsidiaries for abrasives? If you can just explain a little bit out there. Sure. Thank you. I just want to lay out here that since the time we acquired, without PPA, we have been making continuous profit, right? This year, with the exception of the EUR 4 million loss, we expect a loss, right? That is what, and hence, we will have a loss for this year. We expect that, you know, last year, we had a without PPA, we were profit in the last three years that whatever we have been operating. This year, we could be in the range of about roughly EUR 2 million type of a loss. Sure, sir. How is the demand outlook, and how are you seeing this kind of improve it to FY 2027-2028? If you can just talk about that. I do not have a crystal ball, but all we can. Sure, sir. This helps. It's very tough, very tough to predict. I understand. I was just trying to understand, you know, how is the demand in general panning out? What are you hearing on ground? That is where I was coming from. I mean, it's the same as what every one of us hears. I think we need to wait for some more stability to emerge in terms of these multiple things that are floating around. We'll wait for some more sense to provide. Sure. Lastly, if I may ask, what is our overall U.S. exposure? Right? We understand that it is difficult to gauge what will be the actual outcome, and you might not see much. On consolidated sales, roughly about 8%- 10% of our sales is U.S.-based. Okay. Fair point, sir. This helps a lot. Thank you so much and all the best. Thank you. The next question is from the line of Aditya from Kotak Securities. Please go ahead. Thank you for the opportunity. The first question I had was on the abrasives segment, not focusing on where the market is and where the competition is, but hearing as a company had put through certain steps that they would want to take to improve their competitive positioning on the retail side of things and outside. Could you give us a sense of the progress that has been made over there, and when do we, when should you start expecting benefits coming out of the same product? We have rolled out the programs in terms of our abrasives growth. We are seeing the benefits of it, and we are working towards each of these dimensions that we said we will work. As I said, this quarter is an issue relating to some of these inventory corrections in the dealer side of it. Otherwise, our ability to cover new estates, which we are so far, our market share is definitely progressing well. We've started right earners there. MPD programs are firing well, so that is also well on track. In some of this go-to-market work in terms of our agility, ability to work, and getting better productivity, that is also on track well. We think that the programs are on track. It is on the ground. We are seeing the efforts, like for example, the number of calls that each one makes, the number of productive calls each one makes, the coverages that each one makes. All that tracking, whatever we are seeing, are progressing well. We will probably start seeing the results soon. Okay. If there's a need to do a similar kind of maybe benchmarking study or reassess our competitive positioning on the standalone electro minerals side, and then obviously there is an element of Chinese competition, but do you understand any amount of work that needs to be done to get that segment back on track from a competitive positioning perspective? Honestly, our competitive position in terms of the India EMD position is really reasonable. That is why we have in the LTS program, how do we go beyond the aluminum and what are all the programs which we have laid out in the last call is positioned towards that. We are very much on track, and we are progressing towards that. Okay. The last question I had was more on VAW, which is essentially assets that you want to recommission inside the country. In my sense, it's about INR 200 crore -INR 250 crore is something that can be achieved as an incremental sale in the abrasives business. What would be the timeline of the payment? How could we see the contribution clearing up these kinds of revenue levels from that asset? Sorry, I'm not aware that I guided that kind of a sale, but the program of Dronco reposeses, this one is very much on. We are on the ground. The equipment have come. They are in the process of assembling it. Those programs are very much on and in time for execution. It's as per program. Whatever we said we will do, we are going ahead with that. Could you clarify what is the capacity or the revenue number at full capacity that can come from that kind of acquisition and obviously the part of the community? It is not an acquisition. It is an asset purchase where we have, it is roughly about EUR 80 million-EUR 100 million worth of wheels we will be able to manufacture. That is our capacity. The sales number that will come from that would be, are you thinking EUR 80 million-EUR 100 million? We have not told anything like that at this point. As soon as it commissions, at that time we will start sharing. Awesome. Thank you so much for the question. Thank you. That was the last question for the day. I now hand the conference over to the management for the closing comments. Over to you, sir. Sure. Thank you all for your participation. I just want to reiterate the facts that, to me, is well on track as far as the strategy that it wants to implement with whatever we have laid out in the last call. Every program is being pursued right on us. We have a specific challenge in terms of RHODIUS, which completely was unexpected. A warehouse move impacted us in a huge way, about roughly EUR 4 million. The inventory, high-cost inventory that the EMD was holding, is getting liquidated. In fact, it's completely done so that margin pressure that what we have seen in EMD would go away. We see that, you know, the sales pressure that we have seen in abrasives, particularly on some of the distributor sales due to stock clearance, we could not push that we would be able to get back. On the whole, I would say that we are very much on track and progressing in terms of our long-term strategy well. Our balance sheet is quite strong. Cash flows are really good. The focus on free cash flow is really good at this point. We will continue to update you as we meet in the next quarter. Thank you. Thank you. On behalf of Equirus Securities, that concludes this conference. Thank you for joining us, and you may now disconnect your lines. Thank you.