Please note that this conference is being recorded. I now hand the conference over to Mr. Mit Shah from CDR India. Thank you, and over to you. Thank you. Good afternoon, everyone, and thank you for joining us on Godrej Agrovet's Q2 and H1 FY 2022 earnings on this call. From the company, we have Mr. Nadir Godrej, Chairman of the company, Mr. Balram S. Yadav, Managing Director, and Mr. S. Varadaraj, Chief Financial Officer. We would like to begin the call with a brief opening remark from the management, following which we will open the forum for an interactive question and answer session. Before we begin, I'd like to point out that certain statements made in this call may be forward-looking nature, and a disclaimer to this effect has been included in earnings presentation shared with you earlier. I would like to now invite Mr. Na dir Godrej to make his initial opening remarks. Thank you, and over to you, sir. Good afternoon, everyone. I welcome you all to the Godrej Agrovet conference call. I hope you are doing well and are staying safe. The second wave of COVID-19 in quarter 1 fiscal year 2022 had significantly impacted the economic recovery seen in preceding quarters, especially in rural India, which had much stricter lockdowns. After the start of the southwest monsoon, it was marked by extreme localized rainfall events, an unusually dry August, and an abnormally wet September resulted in lower kharif sowing. COVID-19 cases have started declining steadily in quarter 2 fiscal year 2022. Key macroeconomic indicators such as GST collection, purchasing managers index, unemployment rate, etc., also signal a recovery. We expect the economic recovery to be faster in the second half of the year. At Godrej Agrovet Limited, we continue to focus on employee safety and business continuity. I'm happy to share that 100% of our eligible employees have been vaccinated with at least one dose and 85% of employees have been vaccinated with both doses. Moving to the financial and operational performance, the key highlights and developments for the second quarter and the six months ended 30 September 2021 are as follows. Q2 FY 2022 and H1 FY 2022 were a mixed bag for Godrej Agrovet Limited. The total income registered a healthy growth of 25.4% and 26.7% respectively in the current quarter and the half year over the corresponding previous period. Consolidated profit before tax recorded a modest growth of 3.1% and 2.7% respectively for Q2 FY 2022 and H1 FY 2022. Please note that for the second quarter and half year of fiscal year 2021, total income excludes INR 9.6 crore and profit before tax excludes INR 4.8 crore of income earned from sale of real estate. Our consolidated balance sheet remains strong, with net debt to equity of 0.58 as on 30 September 2021. Now I will discuss the key financial and business highlights of key parts of this segment. In animal feed, growth momentum in volumes continued in quarter 2 fiscal year 2022 across each category, resulting in robust growth in revenues and profitability. The segment revenue and segment results grew by 58.8% and 51% respectively during the quarter on the back of volume growth of 20.6%. For the half year, the segment sales grew by a healthy 41.4% and segment results were up by 26.8%. Realization of R&D benefits and introduction of new products supported improvement in the segment results. We had a very good quarter in the vegetable oil segment. Our segment revenues and segment results grew by 36.9% and 88.5% respectively. Higher yields and higher end product prices contributed to the growth. Prices of crude palm oil and palm kernel oil increased by 55% and 76% in quarter 2 fiscal year 2022 over quarter 2 fiscal year 2021. Our oil extraction rates show increase by 1% in the quarter. For the half year, our segment revenues and results have grown by 53.2% and 131.1% respectively. In the standalone Crop Protection Business, segment revenue registered a decline of 12.6%. Segment results also declined by 24% as erratic and inconsistent pre-monsoon rain resulted in lower sowing of major crops during the kharif and reduced application opportunities for our agrochemical products. Margins were further impacted by steep inflation in raw material prices, which could not be absorbed, resulting in lower margins and lesser sales. Even through the half year ended September 2021, our segment results declined by 7.6%. Moving to the performance of our subsidiaries. Astec LifeSciences posted a decline in revenue and EBITDA in quarter 2 fiscal year 2022 of 33.8% and 29.9% respectively. The performance this quarter was adversely impacted by the closure of the plant due to floods for about 15 days. Global shortage of containers limited the ability to ship goods, resulting in deferment of sales. However, we believe that on a full year basis, Astec will maintain moderate growth in its top line and profitability levels. After a challenging first quarter, our poultry subsidiary, Godrej Tyson Foods Limited, registered a revenue growth of 30.4% in quarter 2 fiscal year 2022. EBITDA growth was 12.6%, supported by higher volumes and improved realization in live bird and the drumstick segment. For the half year, Godrej Tyson has reported an EBITDA of INR 9.9 crore, a huge growth of 67.5%, primarily on account of higher feed cost due to significantly higher raw material prices. Our dairy subsidiary, Creamline Dairy Products Limited, performance was impacted by higher milk procurement prices as compared to the previous year. During the second quarter, revenues increased by 9.7% year-on-year, but EBITDA at INR 4.1 crore was lower than the corresponding previous period. We launched fruit yogurt, which has received an encouraging initial response. For the half year ended September 2021, revenue grew by 11.2%, but EBITDA declined by 95.3%. Revenue from value-added products grew by 38.2% year-on-year in quarter 2 FY 2022 and 27.1% year-on-year in the first half FY 2022. GAVL's joint venture in Bangladesh, ACI Godrej, recorded another quarter of strong performance with revenue growth 17.5% in quarter 2 FY 2021. Growth was driven by strong volume across all feed categories, cattle, poultry and aqua feed. This concludes our business and financial performance update for the quarter and half year. With this, I close my opening remarks. We will be now happy to take your questions. Thank you very much, sir. Ladies and gentlemen, we will now begin the question-and-answer session. Anyone who wishes to ask a question may press star and one on their touchtone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handset while asking questions. Ladies and gentlemen, we will wait for a moment while the question queue assembles. To ask a question, please press star and one at this time. The first question is from the line of Aniruddha Joshi from ICICI Securities. Please go ahead. Yeah. Many thanks for the opportunity. Sir, two questions from my side. The vegetable oil segment has done extremely well during the quarter. With palm oil prices remaining high and even the various news flows also indicating it's remaining at a higher level, can we expect similar performance in H2 as well, or do you see any cost pressures, et cetera, that can disrupt in the business model? How is the progress in terms of the new hectares added, in terms of the new fresh hectares as well as the hectares which are being used for the plantations also? That is question number one. Then second question, quickly, this is reiterating earlier questions also, but still the dairy business continues to remain still in nascent mode. Now with inflation expected in dairy maybe after the flush season. How do we see the dairy business from the value creation perspective over next two to three years? Yeah. Thank you very much for your question, Aniruddha. First question is that, yes, prices have been extremely good in the oil palm segment, but all our profits have not come only from price variance. I think there is a substantial improvement in efficiency also. If you remember in my last meeting, I said that we have taken help of consultants called Renoir to work on efficiency parameters. Plus we also have initiated several R&D initiatives which have improved our oil extraction ratio. When you see our annual numbers, we will show a significant improvement in our OER, which is a direct injection into our profitability because we pay on the weight of the fruit. Definitely, oil price is not likely to come down in next few months, but of course, I think they will not remain at the level of H1. Today the prices are close to about INR 106. You know that the government has reduced duty from 22.5% to 27.5%. Having said that, the imports are still very bullish. My sense is that prices are going to remain like this till February or March. The next question you ask is that, how will be the second half? The second half normally is 70/30. 70% of the fruit comes in the first half and, thirty percent comes in the second half. This year is likely to be different because of the change in the monsoon pattern. We are likely to have a split of about 62%-63% in the first half and about 37%-38% in the second half, which is very, very encouraging considering the oil extraction ratio and all the efficiencies have increased in the latter part of the second half, which will continue in this quarter also. We are very bullish on that. I think unprecedented profit and improvement in efficiency will be seen. Now, let me also brief you on expansion plan. You must have known that this National Mission on Oil Palm has started by central government. I think one of the meetings has been held in Northeast, where a lot of basics by the companies and the government were discussed. We have been invited by Arunachal Pradesh government. Our first team has already gone and looked at an opportunity of anything around 35,000-40,000 hectares. Of course, a lot of work needs to be done. We have also made a laundry list of things which the state government has to do. I think that MOU is likely to be signed this week. Next quarter, sorry. Sorry. As far as the regular increase is concerned, I think a net increase of 3,000-3,500 hectares will happen this year also, which is happening for last several years. I must also tell you that 18th of November is the meeting of that National Mission on Edible Oils – Oil Palm in Hyderabad, focused at Telangana, Hyderabad, Karnataka and Tamil Nadu. Let us see. The government is putting its best foot forward. I must also say that the states are still dragging their feet and not fulfilling their obligations. We will let you know what is the progress, I think, in next quarter. We are very optimistic because this team is very, I would say, clear. On milk, yes, you're absolutely right. We are still not out of the hole we are in. Our big hit to the volumes in milk was because of our overdependence on institutional segment. It has not picked up. I can only say that about 10%-20% of that segment has come back. We are hopeful that as the months go by, we will continue to improve our milk volume, particularly in the institutional segment. However little growth we have seen over past several months is all retail, which we are all very happy about because it is very sticky. Second thing is that the positive part is very good growth in value-added products. The scale is still low, but if we chug along at 50%-60% growth per annum, I think base we have, I think 2-3 years later, we will make this business more sustainable from profit point of view. The third thing is that, yes, we have 50% dependence in our business system on milk prices. There has been no flush in the buffalo milk. Actually, the prices have gone up by about 10% in last 3 months, which is a big hit to us. Second thing is that the cow prices, particularly in Southern India, have not dropped in spite of flush because cooperatives continue to support the farmers and paying good price. We are in a little bit of fix, but I think that progressively things will improve as the scale gets improved. Products are doing well, and we are hopeful. Of course, I've been telling that in several quarters, but I think several steps we have taken. I think we will see some improvement in the coming quarters. Okay. Okay, sir. This is very helpful. Many thanks. Yeah. Thank you very much. Next question is from the line of Prakash Kapadia from Anived Portfolio Managers. Please go ahead. Yeah. Thanks for taking my question. I had, you know, two questions. You know, as we've seen in most of, you know. Sorry to interrupt, Prakash. Yeah. May I request you to speak slightly louder? Your voice is a bit feeble. Yeah, sure. I was saying, as seen in, you know, most of the sectors, smaller players are finding it difficult to manage growth in these challenging times, especially, you know, given what inflation we are seeing across sectors. Which segment do you think, you know, we can see higher market share gains? Is there an opportunity in, you know, two, three segments in which we are operating? And, you know, in the first half, what are the price hikes we've taken in the animal feed and dairy segment? And lastly, on the input side, how are we planning, you know, inventory and procurement, given, you know, the variations on input cost on a weekly, daily basis? Prakash Ji, thank you very much. Excellent question. If you ask me, both in cattle fattening and poultry feed, we have benefited partly because of other players becoming a little weak and not able to find working capital that easily. You must have also seen that the soya meal prices, which is the chief ingredient of shrimp feed and poultry feed. In poultry feed, soya meal inclusion is 25%. In shrimp feed it is 35%. Everybody has got hit in profitability except us. Now, why this magic has happened? One of the things is that we have been talking about all our R&D initiatives, bringing in substitutes for such volatile raw material, and I think full benefit of that can be seen this year. So in this segment where our market share has gone up and our profitability, we would be the only poultry feed player in the country. Even the several companies are unlisted, our profitability first half. The second thing I must tell you in cattle feed, we had a very big problem. We were the number one company in the country, but not in a single state we were number one. I think with new launches, with very high performing feeds, at least in Maharashtra, we have regained the number one position once again. We believe the growth we feel which in cattle feed, which we have grown in the first half, that is close to about 14% will be continued in the second half also and may improve. Here again, market share gains are there. After years of decline for last two years, we are showing improvement in shrimp feed segment. This year we have again grown shrimp feed by about 30%. Of course, it is on a low base. From last year we were 15,000 and we are close to 22,000. But that is reflective of the fact that we are doing something right there. Of course, the profitability took a very big hit because soya extraction went from INR 40,000 to about INR 100,000 a ton. The quality of soya we use is superior to what is used in poultry. Similarly, in oil palm plantation also, we would see an improvement in market share. Of course, it was not a good year from volume point of view of fruits, but in terms of oil extraction ratio helped by our R&D, R&D inputs and efficiency improvements, we will see an improvement in OER. OER is very precious, you know that. These are a few areas where we have gained market share. I can definitely say that fish feed was one area where we were very optimistic, but the party spoiler was COVID, because what happens in fish is that the safest way to keep inventory is to keep it in water. That's what happened in April, May and June when the farmers did not harvest. Of course, harvesting happened in the next quarter. Now restock has started, so we are expecting major improvement in fish feed also and improvement in our market share also. Okay. Plus, in Yummiez and in value-added products, we can share, we have data from Nielsen where our market shares have grown, particularly in Yummiez, which is the value-added chicken and vegetarian products in Godrej Tyson Foods Limited. Creamline's packed drinking flavored milk, et cetera. Yeah. There our market share have improved. I think what has hit us very badly, I would say is the cost inflation, particularly in our Godrej Tyson business, in our milk business and in our shrimp feed business. Of course, we have benefited in the animal feed business and poultry feed business because of that. Right. If you could comment on, you know, how we are managing the procurement inventory and something on the kind of price hikes which we've absorbed. Any further price hikes on that will, given what we are seeing on the input side. Except for one area that is shrimp, where the price hikes could not be taken because, you know, Andhra Pradesh is very active in price controls and everything. I think that harassment continues in all industries, including us, where we could only pass on less than 50% of the cost increase. In other areas, we were very prompt and 100% of cost increase was passed on, albeit with a time lag, particularly in cattle feed, in fish feed, in poultry feed. There we don't have a problem. Personally, I love this situation because this is where our muscle will come. At one time, we were holding four months stock of corn and five months stock of soya meal and about four or five months stock of other proteins. That you can see flowing into our profit statement. In spite of the fact that we took some time in increasing prices. Almost there was a 2- to 3-week lag every time we took some price increase. I must also tell you that I think somehow, the government numbers and the industry numbers and production have to be taken with a pinch of salt. There are reports in April on soya meal excess in the country. The price was INR 33,000 ex-Indore, and the price in August was INR 1 lakh a ton ex-Indore. I think we just have to make sure that we improve our information, and I think this is an opportunity for us. It's not a problem anymore. Understood. Thanks. I'll try and give some more questions. Thank you. You can ask another one. Mm-hmm. Thank you. The next question is from the line of Abhinit Kulkarni from Tequity Investment. Please go ahead. Thank you for the opportunity, sir. I have two questions. The first one is on capital employed. In FY 2021, I remember we moved partially away from supplier financing to short-term borrowings. This had an impact on our capital employed representation. My question is, during the last two quarters, have we seen more migration from supplier financing to short-term borrowings? That is one. The second one is, the investor presentation mentions that milk procurement prices have remained significantly higher. I just wanted to know what percentage of our milk procurement today happens from farmers versus via agents. That's all from my side. Thank you. On the capital employed, our drive to sort of move from acceptances to borrowings continued. Close to INR 600 crore is what the sort of drop in acceptances has been vis-à-vis H1 of last year. That's what sort of has flowed directly in increasing our borrowings. That's on the capital employed. Yeah. Milk procurement. We procure about 700,000 liters of milk per day. We had started direct procurement from the farmers. For last one year, little bit of setback there because we have maintained whatever we were procuring directly from the farmer, which is close to about 17%-18% of our requirement. Because of COVID, I think that could not be accelerated. I think the effort has started once again in there. We have our own collection centers which are run by third parties, which is also similar to our own procurement. They are paid a service charge per liter, so they don't control the price or anything. That would be about 50% of our procurement. About 30% of our procurement is through some of the agents and from some supplier who procure the milk, charge a fixed margin and give it to us. All right. That's very helpful, sir. Thank you. Thank you. Next question is from the line of Saurabh from Asian Markets Securities. Please go ahead. Thank you for the opportunity. What was the FFB this quarter? That is what I wanted to say, that volume-wise. Hold on, hold on. Yeah. Last year in H1 we did 3.21 lakh tons. This year we have done 3.06 lakh tons. Now, there is a shift in the FFB procurement. My sense is that this deficit of about 15,000 tons will be made up in November itself. We will come back to whatever we had budgeted, and over the year there will be growth of about 8%-10%, easily. Okay. What was the oil extraction ratio? Good question. OER last year was 16.81% plus. Today we are at 17.75%. Last year Q2 was 17.33%. I am very sure we'll be above 19% this year. 19% No, no. Six months. Okay. My sense is if we keep improving, we may get to almost close to that number on a yearly basis also. Okay. Second question is on the growth projects. We have couple of coming in animal feed and also on the aspect side. I want to update on the animal feeds side and timeline. Two projects were discussed last time. One was the herbicide plant which will make sulfonylureas in Astec LifeSciences. I think that has been commissioned and commercial production has started. The chemical plant normally takes about a quarter to hit the best efficiencies. All the expectations in terms of parameters from the plant, I think that is happening at a very fast pace. Some of the products will definitely be exported in this quarter from that plant. The next was a fish feed plant in north. I think the target date of commercial production is April 2022. We maintain that. The erection of the plant has started, which is a imported plant, which has already reached the site, and most probably the trial productions will start in February 2022. Okay. Sir, last thing, any guidance in terms of, you know, volumes for animal feed for this year? My sense is that same momentum is likely to be maintained. We're in a very strong position. We have good position on raw materials also. I think that we will repeat our performance of H1 in H2. Okay. Thank you very much. Thank you very much. Next question is from the line of Abhijit Akella from IIFL Securities. Please go ahead. Yeah. Good afternoon. Thank you so much, sir. Just one question on the oil palm volumes. You know, as per 2021, as we know, we had a difficult year because of the whitefly attack. This year's volume recovery is a little bit, you know, subdued in relation to that. Has there been any kind of yield loss because of, you know, the last year's attack? By when do we expect to sort of get back to, you know, optimal levels of FFB shipments? There are two parts to your question. First and foremost, I think that all oil palm players started implementing quality standards for fruits very strongly. Unfortunately, we never had that understanding. Now government oil mills like Telangana Oilfed and Andhra Pradesh Oilfed are also part of that understanding. The farmers used to harvest prematurely, and we would get poor quality fruits. My estimate is actually that industry is rejecting between 3%-5% of the fruits. All of us have seen major improvement in farmer behavior from the quality point of view in terms of harvesting and time of harvesting in last few months. I can definitely tell you that about 15,000-17,000 tons of our fruit has been rejected, and we have not taken that at even lower price also just to improve the behavior of farmers. That is one of the reasons why there is an increase in the oil extraction ratio. I must also tell you that there are innumerable research papers which say that about 30% of the oil in the fruit comes in last 20 days. That is what is most critical. These people, just because they want to catch good price or they have some marriage, so they harvest early. The price was being paid by the processors because we had to accept. There was no way of punishing them because of poor OER. I think that is one thing which is a great achievement of this industry, and we need to give them that. Apart from that, there is another project on with a startup where infrared technology will be used to grade the fruit, and we will trace it all the way back to the farm because now all 35,000 hectares we have in Andhra Pradesh and Telangana has been geotagged. That is loss one. Loss two is shifting of volumes. That's what I said, that in spite of these rejections we will post an 8%-10% decrease in volume on a year-on-year basis. Thank you, Balram. Next year in 2023, can we, you know, sort of aim to get back to the, you know, pre-whitefly levels of around 5.7 lakh tons of FFB arrivals? Easily. I must also tell you that all these cuts now while geotagging also we did the census once again. This problem of uprooting still continues to be rampant in this industry. If you really ask me, in last five years we would have added about 17,000-18,000 hectares. Once we started geotagging and started counting the acreage again, we realized that actual addition has been only 7,000-8,000. There has been continuous uprooting also. Second thing is just because of technology and satellite pictures and satellite monitoring, I think the biggest change would be in case we can do that is to manage this business by trees rather than by hectare. Because once we started doing geotagging and we had to walk the plantation, we realized that plantation should have 145 trees. At least half the plantation because of some or the other reason has between 5-15 trees left. The calculation goes haywire when you have 10% uprooting within the plantation also. I think we have learnt a lot and I think increasingly technology will help us monitor this business better. One last thing. The income from associates for P& L is lower year-on-year. Just a breakdown between how much of that is due to ACI and how much due to anything, any other items. For the first year? Abhijit will give this. Yeah. Hello, Abhijit. Yeah, sorry, I didn't catch that. I said we'll give that next week open separately, yeah? Okay. Great. Yeah. Thank you so much. All the best. Thank you very much. Anyone who wishes to ask a question may press star and one at this time. We would like to remind our participants that you may press star and one to ask a question. Next question is on the line of Dipesh from Equirus Securities. Please go ahead. Hi, sir. Thanks for taking the questions. Sir, just one on the animal feed business. Now that the soy meal prices have dropped sharply since end of September, I just wanted to know if you'll be rolling back the price hike that you've taken in the last six months. Yes, we have rolled back. Almost 90% of the reduction in soy meal prices have been passed on, and not just by us, by the entire industry. We believe that it is a little bit of a hit to us also because we had imported soy meal from Bangladesh and from Vietnam when there was shortage. The drop in soy meal prices post 15th of October was very severe. I think for last 2-3 weeks we are still using soy meal which is INR 55,000-INR 60,000 a ton, whereas local soy meal in our factories is between INR 45,000-INR 47,000 a ton. That normally happens whenever the prices fall. My sense is that November will be better than October, and December will be much, much, much better than November. That happened. We are not very concerned. I said that it will be a repeat of H1 performance. Sir, it was basically in the shrimp feed segment or you are saying the entire animal feed, poultry feed also you're Shrimp feed we have not dropped because the government had not allowed us to increase the price. Let me tell you the intervention of government in everything in Andhra Pradesh, whether it is oil palm, whether it is cattle feed, poultry feed, fish feed, shrimp feed, is progressively increasing. Which worries the industry a little. Right. Sir, so my question was basically that in the first half, especially in the backdrop of feed, mm-hmm The branded industry has seen very low margins, right? Because of the soybean prices. Now that the prices have come down and you have taken a couple of price hikes in the first half of this year, do you think the pressure on the government to roll back those prices and give away all the benefits that you may have seen this year? The government may be slightly, I would say, lethargic because this is off-season for shrimp. My sense is that we will be able to maintain the same prices definitely till January, till the next crop season starts. The contribution per ton doubled in last three, four weeks. Got it, sir. Sir, what is the outlook on the EBITDA margins for the animal feed segment as a whole? You think it will be like above 7% because of the prices? Sorry, kitna? I mean 5.7%. Oh. Segment, segment margin. I'll tell you, I'm saying that just because of inflation, the top line has also gone up. In case you ask me, we normally never budget in the animal feed business, EBITDA or profit as a percentage of sales. We budget in rupees per ton. Let me tell you, last year in H1, we were INR 1,748 per ton EBIT. This year we are INR 1,855 per ton EBIT. In case, my sense is that this should be definitely maintained at least. Got it, sir. Last question on the farmer segment. I think you explained in the last question. I just want to understand again that, see, in FY 2020, we had sold around 5-7 lakh tons, and at that time I think we were having 70,500 acres that you have plantation, right? The yield was around 8%. Now the area under plantation has increased. What is the outlook on the, like, FY 2023? Like, can we actually do more than 6.6 lakh tons of FFB in FY 2023? Anything between 5.6-5.8 lakh tons in FY 2023. Okay. The thing that you're saying about the 5%-10% of rejection that the industrial- Yeah, yeah. Now we will be ruthless because I think the government and the farmers take us for granted. They supply very bad products. Government is a very important player in this thing because they control all formula. I think it is too farmer-centric. I think that we are very sure that we are going to make sure that OER does not come down at all. That I think and we will spend on more and more. Another thing I just wanted to point out that almost in Andhra Pradesh, Telangana, we have almost 30 collection centers. In FY 2020, all of them were manned by outside suppliers. We had outsourced that. A collection center is an office with all facilities, internet, et cetera, plus a base team, plus a big yard. We have taken over one third of collection centers with our own people there, put cameras there, et cetera. We are going to take two thirds of the collection centers next year. Wherever we have taken up the collection center, OER from those fruits has improved because we also use this center as training and development place for the farmers. In another two years' time, all collection centers will be very sophisticated. They'll be having these infrared tunnels where we will pass the fruits and get an idea of oil also. I think we have taken over and I can give a separate presentation on that because whatever changes needed to be made to make sure that our collection is good, fruits come on time without losing quality, and we don't take nonsense from the farmer, has been achieved this year. We are very happy to lose the fruit because marginally these fruits are always bad. I'm very happy that in case these fruits go to competitor because they get 13%-14% OER out of it. Yeah. Got it. Over time, the farmers will make sure they supply good fruits. Right, sir. Right. Yeah. In the last report, on the nutrition business, I think actually we already know from the last conference call that was very secondary. On the domestic raw production, if you can just talk a bit, because I think earlier our target was 15% growth for the full year, but now we have actually declined in the second quarter. What's the outlook for the full year, sir? Not very good. Let me just tell you the two, three things which have happened to us. I think that dry spell has, and that has happened to everybody, that the herbicide dependent companies are in big trouble. That is one bad news. In this quarter also we will have to pay returns. That is point number one. Point number two, at one time we used to make a decent margin on generics. Just because there were less number of players, a price war started and we had to reduce the price. Because of that, our profitability almost vanished in generic insecticide, which is almost 1/3 of our business. We were hopeful of launching one more insecticide called Gracia, which is a product from Nissan. Unfortunately, this CIB kept on delaying meetings, et cetera, because of COVID, this, that and all. A product which should have been launched in July is likely to be launched in December. That is the third bad news. I think that this year is not likely to be very good, and I'll be very happy if we get anything near last year's numbers. The problem may be more or less with companies, but the industry is facing this problem. On the other side, Astec LifeSciences-like companies, I think we are just going to come back with a bang because now that containers are available, that hazardous containers was a very big problem, that is available. The prices are very high. Some of the delays in exporting have also benefited us because the raw material we had for them was at lower cost and the price of the material which we are exporting now is higher. I think there's been some kind of improvement in margin per ton also. I think it is a mixed bag. When you see an integrated play of Astec plus CPB, we may still save our face. If you are asking the B2C business, I think it is a very, very tough and challenging year for us. Got it. Thank you, sir. Thank you. Before we take the next question, we would like to remind participants that you may press star and one to ask a question. Next question is from the line of Sumant Kumar from Motilal Oswal. Please go ahead. Hi, sir. Can you talk about the palm oil price outlook? Sir, would you like to enlighten them, sir? Yeah. We expect palm oil prices to be around the same for the next six months. Beyond that it is very difficult to predict, but probably the prices will fall beyond that. Okay. Now talking about the overall palm oil plant, can you talk about the, what is the utilization in H1? I think how do I tell capacity? Because we have capacity of 70 plus 60 plus 50. Yeah. Yeah. About 100 and- Eighty. 80 tons of fruit per hour. The plants are utilized fully for only 100 days. Yeah. Partly for about 100 days, and nothing for about 125-130 days, and rest is maintenance. My sense is that given this spread, you know that we had in FY 2021 we had modified one of our plants, and increased capacity and sophisticated the equipment also. We are good for 6 lakh tons of fruit in the same spread on the monthly basis. That is the capacity according to me. Post 6 lakh tons we will have to invest again, close to about INR 125 crore in another plant. Six lakh ton means that we are very good till FY 2023. What we observed in the past also, apart from the whitefly impact, the competition is getting more FFB from us versus others. We have degrown over the years apart from FY 2021, where the whitefly impact. We are getting challenges. Can you talk about that? What are the challenges we are facing in the market? I think. Let me tell you there are three challenges. One of the challenge definitely is the whitefly challenge, which we neutralized to almost 90% level this year. We were very happy that we got that opportunity in February and March, before the second wave came, that we were able to spray and other things and control. I can definitely say that 2-3% of area is still vulnerable, and I think we will have to go back to a more aggressive control in that area. There'll be loss of about, my sense is 8,000-10,000 tons there. Telangana Oilfed prices which is adjacent to our mill were slightly higher than Andhra Pradesh Oilfed prices. There was no flow of fruits to them. In particularly in the months of July and August, not in the month of September, because the government of Telangana realized that the fruits which are coming to them are of very poor quality and actually the kind of payment they're making to the farmers, they are not making money or losing money, so they've stopped that procurement. That is another, say 8,000-10,000 tons. I can definitely tell you that this sixteen to eighteen thousand tons of fruits which belong to us and which should have come to us has gone because of whitefly this year. Last year whitefly loss was close to 60,000-70,000. I think that is these are the two challenges. Plus there is a shifting of tonnage also. I'm quite hopeful that we will register growth over last year come what may in this year. Without counting the two losses. Can you talk about the overall rabi season in the previous year same quarter in Q3 and Q4, which has shown good numbers. On that basis, people are talking about rabi season is going to be good. So what's your take on that? Look, I tell you that rabi season is a insulated season that way. The reason is that most of the crops are very focused on areas where very good irrigation is there. For example, I would say that if you take, for example, wheat is the main rabi crop. 98% of wheat is grown in this country in irrigated areas. So that whether you have a good monsoon or a bad monsoon, it is not affected. Plus the very good rains in September and October beginning in certain parts of the country caused a little bit damage to the kharif crop, but definitely left a lot of moisture and water in the reservoir as well as moisture in the soil and water in the reservoir. Irrigation for certain oilseeds like rapeseed and say pulses like gram, et cetera, will also be pretty good. I think the kind of risk you see in kharif because the temperatures are very high in the country. Water is a very, very important input. You don't see that in rabi. I feel that rabi will be improvement over last year definitely. You and I will shell out more and more money in festivities and procurement, et cetera. I think that story will continue. Sugarcane will be a little short, but again, the government will cover the farmers by increasing the prices. In rural area, if you ask me, there is not much of a stress. Whatever you read is totally different now. Of course, they were hit very badly by COVID. They are not spending, not because they don't have money, just because they know that they need money should there be a second, third wave. Whoever had money in the first wave, in the second wave in rural areas had better chance to survive. Entire rural India is conserving money should there be a third wave. Government is pumping close to INR 20,000 crore per month in rural areas. MNREGA outlay is going to be about INR 80,000 crore for the whole year. Almost, 80 crore people are being fed. More than 60% of them are in rural India. State governments are doing scheme after scheme. I think in most of the states, farmers receive between INR 3,000 and INR 5,000 per month for doing nothing. I think rural India is in pretty good shape, and that will drive growth and growth of economy in the next quarter once they're comfortable and confident that no wave three is there. Rural India pretty much shape. I think the bottom 20% of rural India, which is landless and water-fed areas and all, have been suffering irrespective of whatever happens. That will continue. Lastly, sir, can you talk about the government cut basic duty and AIDC? I think government gifted more than $2.5 billion to Indonesia and Malaysia. Because when they started cutting duty, the selling price of oil was INR 120. Every time they cut duty, it came down by INR 5-INR 7 and went back to INR 120. That is what, because the prices were increased by Malaysia and Indonesia. I think that is a very good gift by central government. In spite of wisdom shared by innumerable experts in this area, the Consumer Affairs Ministry prevailed and said that we need to reduce the price for consumers. I think the last duty cut definitely has had some impact, particularly in soya meal, soybean oil and sunflower oil, et cetera, but not in CPO. CPO prices from INR 120 came down to INR 109-INR 110. My only, I would say request and expectation from the government is when the prices start going down, they should bring back the duty with the same fervor and promptness with which they reduced it. The current duty is 15.25, correct? 5%. Hello? CPO is 5%. Including everything. Customs duty and I think something like that. I'll just tell you, but it is single digit, yeah, I remember. There's some research you have your PS. I have it. I can get it now. Just a minute. Let me just read it out to you. This is on October 19 was the last one. Crude soybean oil is 5%. Soybean oil edible grade mill. Crude palm oil is 7.5%. Sorry. Refined, bleached, deodorized palm oil, RBD palm oil, RBD palm stearin, and any palm oil other than crude palm oil mill. Crude sunflower seed oil, 5%. Sunflower oil, edible grade mill. Any other sales are also there. Basically what I understood. No. Because they CPO is 8.25%. 7.5+ Plus percent. Eight point two five. 8.25%. Yeah. 10%. I told you it is single digit. It's not... Yes. We'll send you the table, yeah. Yeah, yeah. Calculation. Yeah, yeah. Thank you so much. Thank you very much. Ladies and gentlemen, that was our last question for today. I now hand the conference over to management for closing comments. Over to you. Thank you. I hope we have been able to answer all your questions. If you have any further questions or would like to know more about the company, we would be happy to be of assistance. Stay safe. Stay healthy. Thank you once again for taking the time to join us on this call. Thank you very much, Mr. Godrej, members of management. Ladies and gentlemen, on behalf of Kotak Mahindra Group, this concludes today's conference call. Thank you all for joining us, and you may now disconnect your lines.