We welcome you all to the 1QFY26 Earnings Webinar of Elgi Equipments Limited. We have with us today Mr. Jairam Varadaraj, Managing Director representing the company. I would request Mr. Jairam to take us through the results presentation, followed by a Q&A session. Over to you, sir. Thank you. Thank you very much, Kamlesh. Thank you very much, Asian Market Securities, for organizing this. Ladies and gentlemen, I apologize for being a little late. I had some difficulty. Sir, you are not audible. Hear me now? Sorry, sir, we can't hear you. Can you hear me now? No, sir, your voice is sounding too low. Is it better now? Can you hear me? Can it be a bit louder, sir? Then it will be okay. I... Yeah, now it's better. Perfect. Quiet, sir. Perfect. Quiet, sir. Perfect. Quiet, sir. Sir, he seems to have lost your name, sir. I'm asking him to get disconnected here. I just disconnected. Can you hear me now? Yes, sir, I hear you better. I don't know what to do here. I've just had difficulties right through this morning. Can I go ahead now? Yes, sir. Yes, please go ahead. Ladies and gentlemen, I apologize for this. I had some difficulty connecting up and for technical issues. I'm really sorry about that. I hope you let me project this again. I hope you can see my screen now. Yes, sir. Yes, sir. Okay. Thank you. Again, apologies. I'm going to take you through the earnings call, and some highlights about our business. I'll start with, as usual, the EBITDA reconciliation compared to the previous year. Previous year, same quarter. Our revenue grew by about 8%. For that 8%, our EBITDA should have been INR 1.5 b illion and odd, whereas we came in at INR 1.2 billion. Our contribution and gross profits have been quite healthy, continue to be strong. There were two expenses that have gone up. One is employee cost and other expenses. I had highlighted earlier that we are going through certain initiatives as part of our various programs, including our digital, IT, finance transformation. The expenses that have come in are relating to that. Our employee cost has, you will notice it's a 10% increase, but the actual increment is not 10%. The normal increases have been in the range of 5% - 6% in a global context. The balance of the increase has been primarily headcount increases that we have planned and done as part of the initiatives. The summary of this is profitability at an operating level continues to remain strong. Our expenses are pertaining to initiatives that we are very sure are going to give us solid results in the future. Moving on, on our sales highlights, all of our regions and countries grew except Europe and Australia. Europe continues to remain challenging, economically, and there are things that we need to do as well, which we have initiated as part of shifting direction. Australia, the economy has been weak, but it's coming back. We are quite confident that with some of the things that we are doing, we will get back to a good growth in these two regions. This is a highlight at both at a revenue level, which we've already spoken about. At a PBT level, we have grown 18%. You will see it towards the end of this presentation when you look at the consolidated or the overall financials. We have done very well in terms of our cash position, and we have managed that cash very well through our treasury. That has contributed also to a healthy PBT besides the operations. Sales mix both between the businesses, between the two businesses, and geographically has roughly been the same. It kind of vacillates 2% or 3% up and down from quarter to quarter. It continues to be at the same level. We expect that this will be the case going forward as well. This is the consolidated financials that I was referring to. When you look at our PAT growth, it has been quite significant on the back of our other income, which includes financial income through our treasury and our cash. Our net cash position as of the end of the first quarter has been pretty healthy. In my earlier call, we were talking about managing our inventory, managing our receivables, managing overall working capital. All these are beginning to yield results. What you're seeing now is not a big contribution, has not come from all the initiatives that we have kicked off for better working capital management. I expect to see improving cash positions in the coming quarters. This is an overall presentation from my side. Just as a quick thing on revenue, our revenue has, in terms of our growth, we have had, just give me a minute, close to bulk. Quite a bit of it has been our volume growth. There has been a balance between volume growth, exchange rate, as well as price increases. I wouldn't say that any one has been a huge contributing factor, but a large piece, a big contribution has come from volume. This is really what I wanted to say. As far as the numbers are concerned, I will now give you a little bit of background on our various businesses. We'll start with Australia. Australia, like I said, has had challenges in the economy. We are working on different initiatives to expand our presence there. It's been slower than what we expected, but we think that in the third and fourth quarter, we will start seeing some strong comeback in Australia. Southeast Asia continues to be a very small region. Growth has been there compared to the previous year, but it's not a large number. We've got some initiatives that we are looking at in specific countries, but it's too early to talk about. India has been a strong story for us. It continues to remain strong. We are beginning to see some hesitation in markets, some tentativeness brought about by all these conflicts in the different parts of the world, more importantly, the tariff situation in the U.S. A lot of companies are, the inquiry levels continue to be strong, but finalizations are getting deferred because people are wanting to wait and see where this whole tariff situation is going to land. Everyone knows that 50% is not sustainable, not only for India, but for the U.S. and for the rest of the world. Where will it land? Will it be at 20%, 25%? This is something that people would like to understand before they go forward in terms of investments. We are seeing that, nevertheless, our various initiatives across various product categories are partially compensating for it, and that's where we are beginning to, I mean, we have seen the growth. We continue to remain optimistic about delivering on this trajectory in the next few quarters in India. I don't see any reason for us to be too concerned. Moving further west into the Middle East and Africa, both those regions have done well for us in the past, and they continue to do well. Strong revenue and strong profitability. From a region point of view, they're still small, but they are quite robust in their operations and profits. Europe has been a challenge. We are working towards various initiatives that will kickstart for us Europe all over again. We are keeping our head above the water as far as not dipping back into a loss situation. The loss that we are seeing is not primarily because of the extremely strong euro with respect to the rupee. In rupee terms, there has been an increase in loss, primarily because of the depreciation of the rupee. In euro terms, we are still keeping our head above the water. We are working on various initiatives, not only to protect the bottom line, but to grow the top line quite significantly. Our roadmap business is under challenge, primarily because there's a large dependence on the U.S. market. With these tariffs and the general dip in the construction and mining segment in the U.S., which goes through cycles, and right now we are at the bottom of the cycle, there has been a challenge, but the business and the company is still making profits, and we hope that the next few quarters there will be growth in that entity. Moving on to the Americas, North America specifically, particularly, it has done well for us. We have grown. How will we be? Sir, we are losing you in between, sir. Can you hear me now? Yes, sir. We are audible. Could you please repeat the last statement, sir, the one that you're making? How are we growing? Question of where? Sir, we are still losing you. The words are dropping in between. Is it better now? Sir, the volume of your voice has gone down. Can you hear me now? Yes, sir, it's getting better. Is it okay? Yeah. Okay. I'll repeat what I just said. As far as the U.S. market is concerned, all our businesses are growing well there. To sustain our industrial business, which is, I'll talk about the industrial business first and then come back and talk about the portables. The industrial business at 25% tariff, we would have managed. We had created already multiple initiatives. We have inventory that will last us for a few more months, by which time these initiatives would kick in. We were reasonably confident that we will overcome the impact of 25% duty and still be competitive in the U.S. market. Now, with this additional 25% duty, the current initiatives that we are running and the current options that are available are not adequate. We need to make some fundamental structural changes, which we are evaluating. It is too preliminary for me to talk about it for two reasons. One, the plan itself is at a certain altitude, which would be not prudent for me to talk. Second is, we don't even know whether this 25% is going to be sustained. In the next month, month and a half, we will know whether we need to trigger some of these structural initiatives that will enable us to compete in that market with that additional 25% tariff. That's really where we are. For the next few months, I think till the middle to end of the third quarter, we should be fine. We hope that we will find a resolution between now and then, either in the form of lower tariffs that get settled, which we don't influence. If that were not to happen, at least we will have a plan in place. If we have to make some structural changes in response to this additional 25%, it will take us at least a year for us to respond to both to get back to that level of competitiveness. Things are very fluid now, so I don't want to make any firm statements except that we are really on top of things. We are working on multiple initiatives to resolve. It is a strategic market. This is not a market that we are going to walk away from. No amount of duty is going to distract us from our presence there. We will continue to work on solutions. This is on the industrial side. On the portable side, it is primarily exported out of Europe from Rotare. There is a 15% impact. We are working on various cost reduction initiatives, and we are reasonably confident that we will be able to mitigate this 15%. I'm not too concerned about the portable business. As it is, it's at a low point in the cycle. We expect in another six to eight months or a year, it'll come back and we'll be in a good position to capitalize on it. Overall, except for the uncertainty in Europe, I mean, in the U.S. tariff situation, everything is good. I will wait for your questions to clarify. Thank you very much. Thank you so much, sir, for your opening remarks. We'll wait for the question to ascend. Give me a couple of minutes. Sir, the first question we'll take it from the line of Harshit Patil. Harshit, you may unmute yourself and go ahead with the question. Hi, sir. Thank you very much for the opportunity. Sure. Sir, my first question is on the composition of our U.S. business. We sell industrial compressors manufactured in India, and then we export it to the U.S. We also sell portables from Rotare to the U.S. We also assemble those medical compressors, branded in the name of Pattons over there. What is the share of all these activities in our overall North American revenues? I'm just trying to gauge what portion of these revenues will be impacted by tariff and to what extent. That's what my thing is. I understand your question, Harshit. I don't want to get into that minute details. If you can go to our annual report of March 2025, you will see the sales of the various entities. That is declared there. You will be able to make out what percentage of the revenue is delivered by which entity there. There is Pattons Inc., there is Pattons Medical, there is Michigan Air, and Elgi Industrial, which is a combination of both industrial and portable. I wouldn't like to give you the split between those two products, but from an entity level, those numbers are there. Sir, just to clarify, this Michigan Air, all these products are manufactured in India only, or do we have some other kind of sourcing arrangement over there? Most of our equipment sale and aftermarket sale comes from India. Sure. There's very little. You can on average take about 15% as bought out there. Understood. Sure. Sir, my second question is on the profitability in both U.S. and Europe. I think we had achieved the break-even level in the fourth quarter of FY2025 in both these geographies. Correct me if I got it wrong. You mentioned that at 25% tariff levels, not the additional 25%, but the initial 25%, we should be able to sustain these break-even levels in the U.S.? No, U.S. is actually profitable, Harshit, right? It was not profitable in the last quarter of last year, but this quarter it is profitable. We can sustain it. I'm saying U.S. has at a consolidated level of all the businesses. Yeah, it is profitable, and we can sustain it if the tariff is at 25%. That's my point. As far as Europe is concerned, it had broken even last year. It continues to break even at a euro level, but because the euro has appreciated significantly, there is a loss when you restate it in rupee terms. Understood. Perfectly. Thank you. Thank you very much, sir, for answering my questions. I'll come back. Thank you, Harshit. Next question being taken from the line of Mayank. Mayank, you may unmute yourself and go ahead with the question. Mayank? I think we're facing some technical difficulty from Mayank's end. We'll take the next participant in line. Rahul, you may unmute yourself and go ahead with your question. I'm wondering if everyone's got technical issues today. Rahul? We'll take Rahul a little later. Next question is from the line of Bhavin Bitlani. Bhavin, you may unmute yourself and go ahead with the question. Good morning, Jairam. Morning, Bhavin. How are you? Very well, thank you. Jay, first, my compliments. Really impressive performance. We saw your PR reporting yesterday. I mean, really appreciated the performance. I have a couple of questions. You have 18 key end-user industries that you outlined in the annual presentation. Out of that, the critical ones that are the larger salients, if you could give us a color where you are seeing an uptick in the inquiry level and where you are actually seeing a slowdown. I mean, 15% growth for us is really impressive. It looks like you have clearly gained shares. What's the kind of share that you have gained? I don't want to talk too specific, Bhavin. The point is, as far as India is concerned, before all this tariff conversation started, there were high levels of optimism across all segments. There was no, I wouldn't call out any one segment that was especially strong or a segment that was especially weak. Now, across the board, we are seeing a bit of a pause. The pause and the reversal are a little bit more pronounced in segments that are more substantially dependent on the U.S., namely the textile industry, right? Auto components is the second one. Auto components, I think they are a lot more confident that they can handle these tariffs better. Textiles, considering that Bangladesh and the other countries that could become a competitive option, their degrees of freedom to respond are limited. Whereas auto components, you don't see the switching costs are very high. I don't think it's going to happen that quickly. Sure. On the market share, it clearly looks like you have gained considerable share. We haven't tallied that share yet. We are growing, no doubt. Market share is a very elusive number because it's not really published in any meaningful manner. Every once in a while, we go back and try and assemble together the market data and try and do it. To your point, yes, have we gained? We probably have. about some of the initiatives that you had in terms of stabilizer technology, the increase in the depth of products for the oil free screw, and also if you could talk about the water well piece given that monsoons are starting? The stabilizer has been put into the market for more extensive customer feedback, not so much customer feedback, but to gain testimonial. Every customer that we have installed in, their experience has been outstanding. We are very, very excited about it. In the month of September, we will be launching the product or the technology across India. I think by April is the timeline for launching it globally, right? That is a very exciting thing for us. Similar such technologies are being worked on at various stages of being ready to bring into the market. As far as the water well is concerned, like I said, it is not at the peak, not at the bottom. It's kind of somewhere in between. We are continuing to hold and in some locations gain share. It is not a big market at this point in time. The total market is not so big. We are doing better than what we had planned in water well. Sorry, I forgot your third question. Oil-free screw. Oil-free screw, yeah. We have the full range. There is nothing specific that we have done. When I look at last year's performance for the U.S., revenues were flattish, and in the commentary, you mentioned there was a significant drop in the portables. Is the share of portables too tiny that even a sharp drop doesn't impact the overall headline numbers for the U.S.? It's not true. I mean, portables is not a small business at peak levels, and when it drops, there is a substantial drop. Overall, will it have a huge double-digit impact? No. Okay. Thank you so much. Those are my questions. Thank you, Bhavin. Next question will be taken from the line of Mayank. Mayank, could you please unmute yourself and go ahead with the question? I think the problem-solving process will take the next person in the queue. Yeah. Ripul, can you please unmute yourself and go ahead with the question? Ripul? I'm getting a message which says from Mayank saying that not able to unmute. Is there an overall control that you have? No, sir. The lines are pretty much open. Mayank, can you unmute yourself? He sent a message saying that he's unable to talk. I read through it. Yeah, maybe it's the same problem with Ripul as well. Sure. Please take the next person in queue, sir. Saleem, can you unmute yourself and go ahead with the question? Yes, thanks, Kamlesh. Good morning, Dr. Jairam. My question is, you know, on these cost-saving initiatives that you are going to put in place if, you know, tariffs remain at 50%. Right now, you've already done a 25% kind of, you know, bridging the gap between what you were earlier and with the new tariffs. Now, another 25% seems like a very, you know, at least process outside of that seems like a very fast one to achieve. It's good to understand, you know, maybe one or two examples of what you have managed to do to bring it down. Related to that is, you know, how much time do you think you need to get from 25% - 50% tariff for this? Saleem, what I have said is we have a solution in place for the first 25%, right? Right. We don't have an immediate solution in place for the next 25%, right? Yeah. The next 25% for solution is not going to look like a solution that we have had for the first 25%, right? That's why I said the second 25% will involve certain structural changes, right? Mm-hmm. In the way we are organized, the way we are, our geographical presence and all that. Yeah? Right. It will demand a much more fundamental change. Now, those changes, those fundamental changes will be expensive to implement. It will take time to implement. Therefore, before we trigger them, we need to be 100% sure where this tariff is going to settle down. Yeah? Okay. Till then, we will not trigger those kinds of solutions. The first 25% is in the bag. We don't have an issue. We will deal with it. Part of it will be a price increase because everyone is looking at a price increase. Some of them have already implemented it. We will wait and watch at what levels the market settles down as far as prices are concerned. We think it'll be anywhere between 5% - 10%, right? It'll be the price correction that will take place as a consequence of these tariffs. Now, therefore, it leaves us a gap of anywhere between 15% - 20%. We are well, we have enough done to be able to mitigate that. So 25%, we are very good. Right. If it settles below 25%, then obviously you maybe pass on some of the prices to the customers. No, it's profit for us. Profit for us. You are fantastic. Great. The second question is, you know, this domestic market share, you know, what looks like could possibly be a market share gain. Would you hazard a guess as to, you know, is it your new variable frequency drive products that are driving this, or would this be a longer-term, you know, investments in business that you've made which has helped you get where you are? This is not technology that, like I said, the technology of our new technology that we have launched is not, has not been launched yet, right? The impact that you're seeing is not from that, right? It's just fundamental shifts in the way we are doing business, engaging with customers, our market strategy, our marketing strategy, all of it. I can't put a saying that this one thing has given us that, right? Fair. Great. Lastly, if you were to look at, you mentioned that till the tariff increases happen, the domestic market looked all right in the sense that your customers seem quite optimistic of the outlook. Textiles and auto comp are now impacted. Broadly, you're seeing excess of tariffs. What is the general demand commentary? The macro does not, I mean, the newspaper headlines always seem to be a little pessimistic. When you are on the ground meeting customers, how do you see broader industrial demand in India over the next 12 months or so? Ex-tariff, I think everything is hospital. It's very difficult to say, you know, we'll ignore the tariff, right? It's a large market. It's a large economy. I get the market in the U.S. It's a large economy, which any dislocations there could have a ripple effect globally, right? Nobody can really ignore it, right? Got it. Got it. Please, that was all from me. Thank you so much. Thanks, Saleem. Next question, we'll take it from the line of Amit. Amit, you may unmute yourself and go ahead with your question. Hi, sir. Am I audible? Yeah. Yeah, I am. Yeah. Thanks for taking my question. First question, on the delay in finalization of orders, which you highlighted, which many companies are highlighting, amid tariff uncertainties and geopolitical situation which we saw. I wanted to understand, even if, with the scenario of 25% tariff or 50% tariff, are we going to see the delays continue for the remaining nine to 1 2 months? Are we going to see the projects getting shelved off because of the higher tariff, even if it is 25%? Some understanding there, and any particular sectors where we are seeing the finalizations have been particularly delayed because of the scenarios? That is the first question. I can't give you a coherent answer at an economy level, Amit. I can only say that, certainly, customer sentiment is wait and watch, right? It is not about closing projects. Nobody's closing projects. Everybody's saying, "Let's wait and see." That's the prevailing sentiment. The optimism with respect to the Indian market continues to remain. Everyone's saying, "Let's wait and see." As far as the segments are concerned, like I said in my earlier thing, there are things like textiles who have a significant dependence on the U.S. market and who have a significant impact because of tariffs. Where there are alternate countries as solutions for the American customer, they are a lot more concerned and therefore a lot more cautious about investments. Textiles is an example. When you look at textiles, you have Bangladesh, you have Vietnam, you have Indonesia, you have Thailand. All of them have got much lower tariffs than India, right? There is definitely a, and the switching costs in these are not very high, right? When that happens, there will automatically be an apprehension. The rest, we just have to wait and see where it lands because too much of turbulence and dust for us to see through this flower. Sure. The second question is on the Europe and Australia market. I recollect for Europe, we did also highlight that we'll be expanding into Nordic countries where the opportunities exist and also expanding the distribution network there. Have we done any progress there? Despite Europe slowing down, are we thinking of any other strategy apart from what we highlighted in the last call that you want to expand to Nordic countries? Any further strategic change we are doing in Europe to become better there? Nordics was nothing new. We've always been present in the Nordics, and it continues to do well for us. The problem is not a specific location in Europe. Generally, the Ukraine war really dislocated energy prices, and there were issues there. All the major economies in Europe took an impact on the cost of many refugees coming into Europe from various countries, Syrian, from many countries. They have to pay for it. There were economic constraints because of that. The general U.S. tariffs thing is also a factor. It's a combination of multiple things that there is a certain economic stagnation. One vector that everyone is looking at as a bright spot is the huge investment that the whole EU is making on defending. Sir, I can't see you. Am I audible? Yeah, yeah. I think Mr. Jairam has just frozen. Give us a minute. You can unmute yourself. Hello? Yeah, you're audible. Amit. Amit. Can you hear me now? Yes, sir. Sir, Sir, we can see you. The voice is a little lower, Amit. I really don't know. it better now? Yes, sir. Go ahead. I apologize for all these constraints. I was telling about the investment that's being made by the EU in the defense sector. There's a significant amount of capital that is being put in. There will be a trickle-down impact on the demand for general industrial growth. We expect that's a bit of a rainbow at a distance, and we are hoping that the economy, the whole European economy, will get a boost by virtue of this. That's not a short-term play. That's more a medium to long-term play. Right, sir. Sir, lastly, on our CapEx plan, we did talk about INR 250 crore in the first two years. I just wanted to understand, Amit, all the challenges. Is this on track? Second, our guidance of $450 million this year, is this on track? That's my last question. Thanks. Yes, the investments that we are, we are not here for the short term, Amit. We are here for the long term. There are certain expenses that we may cut back, which we can defer, we will defer. Whatever is required for sustaining the business in the longer term, as per the longer-term plan, we will definitely continue to do so. That investment is continuing. It's on track. A few delays here and there by virtue of rain and stuff like that, but otherwise, we are okay. As far as the guidance of $450 million, we are on track towards achieving it. The question really is if the rupee becomes INR 90 or INR 87. Now it's already INR 87. You shouldn't hold us accountable for that division, right? If you divide it by a larger number, obviously, our India revenue is going to become smaller. General direction structurally, yes, we are there. Thank you, sir. There were some questions in the Q&A. You want me to take them? Yes, sir. Sir, Sir, we'll take those questions. These are from participants who couldn't unmute themselves. Correct. First question we'll take from Mr. Ripul Kumar. He said, "Sir, what is the progress in introducing economical compressor range which can compete with low-priced Chinese products? The products are ready. They are all undergoing field validation. We are very confident that they will work because the fundamental architecture is based on our own products. We have not developed any new parts, so to that extent, the reliability is very, very high. Nevertheless, we wanted to get customer feedback. That's where we are at. What we are really focused on is our strategy for the low-end market. Product is only one part of it. Price is a second part of it, which we are already clear. The product and price is clear, but the whole strategy does not work with just product and price. There is a whole idea of how do you brand it, how do you take the brand to the market, what is the distribution network, how do you get to the customer. These are all pieces that we are now building up. We are confident that the whole launch strategy of entry into that market, we will do sometime this year, this financial year. Sure, sir. The second question from Ripul is, "Sir, what% of our motor requirement is manufactured in-house and where do we see ourselves in the next three years and what impact will it have on our margins? I don't want to talk specifically about the profit margin that we are going to make. I will give you a general direction there later on. Percentage-wise, right now, we are at around 40%- 45%. By the end of this financial year, we'll be close to about 70%, 75%. I think in another two years, we'll be close to 90%. This is really the progression that we will have in terms of our motors supply in our production supplying to ourselves. Directionally, you know, our motors are at the same cost structure as the Chinese motors that we were importing. Now, having said that, half of our revenue, that is primarily India, Southeast Asia, a little bit of Australia, were using Chinese motors. The rest of the world, whether it was Europe or America, we were using either European or American motors. If the difference in pricing between a Chinese motor and a European-American motor is in the order of about 20%, 25%. You need to do the math in terms of interpreting this. Roughly, that's the general direction. Sure. Thank you, sir. Next question, I think again from the line of Mayank, who couldn't unmute himself. "Sir, segmented gross margin in compressor has increased sharply sequentially, 53% in 1Q FY2026 versus 50% in 4Q FY2025. Is this associated with some kind of price hike? I see this question. I would like to understand what he means by gross margin because we are, in the way we look at it, we look at contribution margin, which is after variable cost, right? The contribution margin after variable cost is pretty much flat, right? There has been no sharp increase. If he's looking at a different definition of margin, I don't know what that is. That's point number one. That contribution margin combined with, on a higher revenue, a flat contribution, sustained contribution on a higher revenue is giving us a flat percentage of EBITDA. The primary reason for that is the investments that we have made on various initiatives in people and certain software and consultancy that we have done. What kind of margin we expect, I believe that the contribution margin will be sustained, and EBITDA margins at the current level will also be sustained. I don't see that as a concern. Sure. Sir, the next question I'll take is from the line of Naisar. I hope I have pronounced the name right. Could you please unmute yourself and go ahead with the question? Yeah. Hi. Hi. Thanks for taking the question. What I wanted to understand is, sir, you mentioned about the tariff situation that, you know, after maybe a 5% or 10% price hike, you have the 15% - 20% to adjust, which, you know, you should be able to do. The quantum 15% - 20% is not less. I just wanted to understand, you know, what levers are you using to ensure that even after that 15% - 20%, the impact on profitability is not much? This is not something that we, as an initiative that we develop now. This is an initiative that we developed two, three years ago. The biggest, one of such initiatives was the motor production. Now, that insourcing of the motor is going to help us in the U.S. market because last year, we had supplied a sufficient number of test motors into the U.S. We have validated all the motors. They have run enough hours, and they've stabilized. Now we are going, we have started selling compressors with our motors, and that's a significant cost compression for us, right? If the tariffs had not been there, that would have been a significant margin expansion for us. That's the lost opportunity. Yeah. Like that, there were initiatives as part of our overall cost compression program that we started two, three years ago. Those are all coming to roost now. That's why we are confident that we can take this much, this much we can bear. Got it. Fair. Effectively, because you would have done, you know, we've done KPIs for motors and, you know, like you said, lost opportunity. Just from a competitor perspective, you know, how do you see it? Because of the tariffs, will the price rise be limited to 5%, 10%? Or how will it work, you know, in general? Because eventually, you know, it's a KPI, so you also would at some point want to make money off it and things like that. I'm sure even competition would think like that, so. No, I don't understand your question. I'll try to answer to the extent that I've understood. I don't know. 5% - 10% is our estimate of what the competition or the overall market has to increase to sustain their profit at the current level. This is an assumption. This dust will settle down in maybe a month or two where everyone then realizes what is their real cost because of the tariffs, and based on that they will set their pricing. Already, we are seeing some of our competitors increasing prices in this range. That's why we are saying it could be anywhere between 5% - 10%. That's point number one. Point number two is when we looked at our motor plan and our motor project five years ago, it was done to mitigate the risk of dependence on China. Risk of dependence on China at a pricing that did not make any commercial sense. Those prices at which we were buying motors, or the rest of the whole world is buying, had no relevance to the cost because the cost of a motor is easily ascertainable because it uses commodities like copper and steel and customs. There is no magic in terms of estimating those costs. When your supplier is supplying to you at a price which has no relevance to cost, then it's a huge risk in terms of when that rug is going to get pulled out from under your legs. That's when we started looking at motors and saying, we need to hit those cost points, but we do it not by employing cheap engineering, but by using technology. We set aside a certain amount of money to first do a proof of concept to see whether that technology can be developed, which we did very successfully. We built about 50, 60 motors, put it into the field to check their reliability, and that passed the test. When we made the investment into the motor plant and did the costing of the motors, it includes that investment, right? It's not just at a material cost. Got it. No, that's very clear. That's very helpful. Just one follow-up, if I can, from a U.S. market perspective, right, which geography would be like the lowest common denominator? If you take the cost of production plus the tariff, which according to you would, as things stand today, be at the lowest cost in terms of. I don't understand your question. What I'm trying to ask is from a competition perspective, from which competitor or which region will have the lowest cost now after we take into consideration the tariffs? Obviously, a company that is manufacturing compressors in America will have the lowest impact because there's no tariff directly on their compressor. No compressor company in America buys everything in America. They import from all over the world. They will import from China, from Europe, and probably from India. All of them are going to come in with a certain percentage of additional cost. What is their raw material component that is subjected to import and what percentage of that import is at 15% tariff, what percentage is at 30%? That's something that we wouldn't know. We know by and large there will be an increase. Based on the behaviors, it's 5% - 10%. That's the worst case. That's the case that we need to match. Everything else will be even higher than that. The U.S. manufacturer will also match. Could you please wait a second, Jairam? Sir, in the interest of time, we'll take a couple of more questions. One, I'll take it from the chat and one I'll probably take it on the call. The next question is from Bhavin Vitlani. Sir, he says for the stabilizer, would Elgi have in-house manufacturing of PCBA? We have seen multiple electric companies face quality challenges for not having control of the embedded software. Our new technology has no electronics. There is no question of electronics going into our new technology that we have launched. It's a mechanical design, and that's really the beauty of the whole technology. That's not an issue for us. I will take one last question from Rahul because we are trying to unmute him, but he couldn't unmute. Rahul, you may please unmute yourself and go ahead with the question. Your mic is on. Oh, mic is not on. The line is on. He has to unmute himself. I think he's continuing to have challenges. Sure. Sir, Sir, with that, I think we've already exerted our dedicated time to work with. I would request everyone, whoever has questions, to please reach out to the IR team or the management directly. Thank you once again, sir. I would leave it to Kamlesh to hand the motion. Yeah, Jairam, just one point. If you can just elaborate on the progress of vacuum pump product business, any update you want to share? Thank you. Yeah. Thank you, Kamlesh. Thank you for raising that. Our indigenization of the vacuum products has been completed as per plan. We have set up our sales organization. Month on month, we are growing our sales, but the numbers are so small, it's not material for us to report it separately. The business is growing as per our plan, and we are quite pleased with the performance of the product, the customer's response, customers' repeat buying. These are all positive directions. I just want to, considering that we had so many challenges in this call, and I apologize for this, please reach out to us, to our investor at elgi.com. Please refer to the call and please send us your questions, and we will respond to them. We will post those questions and the responses on our website. Great, sir. Thank you. Investors, thanks for joining in. With that, we conclude the call. Thank you, Jairam. Any closing remarks you want to make, sir? No, that's it, Kamlesh. Again, I want to apologize for this. We'll make sure that we do a diagnosis of why things went south, and we'll ensure it doesn't happen again. Thank you very much. Thank you. Thank you so much, sir. Thank you.