Please note that this conference is being recorded. I now hand the conference over to Mr. Nitin Agarwal from DAM Capital. Thank you, and over to you, sir. Thank you. Hi, good afternoon, everyone. Thank you for joining us on the Godrej Agrovet Q1 Earnings Conference Call. From the company, we have with us Mr. Nadir Godrej, Chairman of the company, Mr. Balram S. Yadav, Managing Director, Mr. S. Varadaraj, Chief Financial Officer, and Mr. Anurag Roy, CEO of Astec LifeSciences. We would like to begin the call with brief opening remarks from the management, following which we will have the floor open for interactive question- and- answer session. Before we start, I would like to point out that some statements made in today's call may be forward-looking, and a disclaimer to this effect has been included in the earnings presentation shared with you earlier. I would now like to invite Mr. Nadir Godrej to make the initial remarks. Please go ahead. Good afternoon, everyone. I welcome you all to the Godrej Agrovet Earnings Call. I hope and wish you are doing well and are healthy and safe. Quarter 1 fiscal year 2023 was a mixed quarter for Godrej Agrovet, as we achieved robust volume performance in a majority of our businesses. As a result, reported 25.7% year-on-year growth in our total income to reach INR 2,517.5 crore. However, profitability was impacted for some of our businesses. Our businesses due to external as well as internal factors, such as high-cost inventory, input cost inflation, limited transmission and sales deferrals, et cetera. During the quarter, soy meal prices sharply declined as the Government of India allowed import of GM soy meal. We did not anticipate that it would happen as soon as it did. Other key input commodities such as maize and fish meal also witnessed a declining pricing trend. The delayed southwest monsoon in June impacted the sowing of kharif crops, and the application of crop protection products was delayed. On the other hand, crude palm oil prices reached an all-time high level before correcting rapidly at the end of the quarter. Coming to the key financial and business highlights of each of our business segments. In animal feed, we achieved 11% year-on-year volume growth in quarter one. The volume growth was achieved across key feed categories and was mainly led by market share gains. However, segment results were impacted due to high-cost inventories of some of our critical raw materials, which could not be fully passed on. On a more positive note, we have already utilized most of the high-cost inventories in quarter one, and we expect a quick turnaround of profitability in quarter two. For the vegetable oil segment, it was another quarter of strong growth led by improvement in yield levels and all-time high oil prices. Segment results grew by 2.6 x year-on-year in quarter one fiscal year 2023. The average prices of crude palm oil and palm kernel oil were higher by 24% and 41%, respectively in quarter one fiscal year 2023 versus quarter one fiscal year 2022. Stand-alone crop protection business suffered from lower sales of in-house and PGR products as a delayed monsoon deferred application opportunities in quarter one. In addition, strict focus on channel credit hygiene also led to lower placements as compared to last year. Liquidation and collection of our key products have improved in the first few weeks of quarter two on account of increased rainfall coverage in our key operating regions. We expect a recovery in profitability of our stand-alone crop protection business in quarter two. Astec LifeSciences delivered revenue growth of 43.3% in quarter one. The robust top-line performance was mainly driven by higher export realizations and CMO volume. However, Astec's growth was restricted by deferment of sales worth 20% of the total revenues. This, coupled with the compression of margin in one of our key products and higher cost structures on account of the herbicide plant, led to decline in profits. These sales have been pushed to the next quarter. Our poultry segment registered one of the strongest quarters, with a revenue growth of 39.8%, led by volume growth in Real Good Chicken and better realizations in the live bird category. EBITDA for the quarter also jumped to INR 20.9 crore, as live bird prices rose sharply. Our Dairy segment continued to gain market share in value-added products such as curd, buttermilk, ghee, milk drinks, et cetera, in its key markets. As a result, revenue from value-added products grew by 69% in quarter one over the previous year, while Milk revenues grew by 24%. This further translated into CDPL's total revenue growth of 47.6% in quarter one. However, a sustained rise in procurement and packaging costs led to subdued profitability. GAVL's joint venture in Bangladesh, ACI Godrej, recorded another quarter of strong performance, with revenue growth of 42% in quarter one. All feed categories, that is cattle, poultry and aqua feed, witnessed strong demand and market share gains in Bangladesh. That concludes our business and financial performance update for the quarter. With this, I close my opening remarks. We will now be happy to take your questions. Thank you. Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on their touchtone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. We have our first question from the line of Abhijit Akella from Kotak Securities. Please go ahead. Yes, good afternoon, and thank you so much for taking my questions. Welcome. I have two or three, sir. First on the soy inventory issue. Just you know, sort of wanted to get your perspective on the decision-making process within the Indian government. You know, whether the industry is normally kept informed about you know, such changes in policy, as you know, for example, the import of GMO soybeans. Also, how do we de-risk ourselves as a business against such policy changes in the future? Anirudh, yes. Abhijit. Abhijit, definitely, this was a big setback considering we had such good relation with the government and we were instrumental in getting soya imported last year, which was a great relief to the industry. I must also tell you that during entire March and entire April, the industry, through their multiple fora and associations had kept on harping on government to allow imports. The stand of the government was very clear, and it was categorical. I think what happened towards the end of April, beginning of May, we were extremely sure that nothing is going to happen because all our efforts had come to naught. I think the rising inflation, particularly driven by animal protein, was a trigger which immediately made the government take some knee-jerk reaction. All of us were caught unaware because all of us had started covering soya meal because it was rising almost INR 1,000 to INR 1,500 a week. We had stocks for almost 2 - 2.5 months that time when this happened. We had to take a price decrease because of which we lost significant profits. If you ask me, definitely I think this is a good learning and we will be more vigilant. I think this time we thought because government has been very reliable whenever they have talked to us. Whatever they have permitted and whatever they have not permitted, they have been very categorical about it. We need to also work with other ministries like Ministry of Consumer Affairs and Ministry of Commerce, who are a big influencer in these decisions rather than Ministry of Animal Husbandry and Fisheries and only Ministry of Agriculture. Got it, sir. Thank you for that. Second, on the oil palm business, now with prices beginning to fall sharply, how should we think about the segment's earnings trajectory for the rest of the year? Also, on the new oil palm mission front, you know, how is the traction going, and can it meaningfully accelerate our acreage growth in this segment? I just forgot to add one thing that all our high-cost soya inventories were exhausted by end of June or beginning of July. Profitability is back with a bang in the feed business. On oil palm plantation business, definitely the prices were very, very high, and they were unsustainable. All our calculations were done at the current prevailing prices, so we benefited from high prices in the first quarter. My sense is that even though there have been surpluses, et cetera, but there is a limited amount of capability both in terms of processing in Indonesia and logistics worldwide. It is not that suddenly everything will get exported. My sense is that prices will prevail at about, say INR 100,000 to INR 110,000 a ton. Currently it fell to almost INR 103,000 a ton. In last one week it has gone back to INR 110,000 a ton. That is point number one. That is what we feel will be the prices, average prices in Q2 and Q3, which are very critical for us. The second thing is that it is not that central government will wait for prices to fall significantly. We must also remember once the inflation starts coming down because of other commodities and with our oilseed season round the corner, the government will be willing to listen to increase in duties in case the oil prices fall further because they don't want to shortchange our own oilseed farmers whose crop will be coming to market in 8-10 weeks from now. My sense is that this will remain at this level. Slightly 5% here and there is the only difference which will happen. Yes. Lastly. Sorry. No, you finish Balram. I thought you had finished. Sir, on NMOP, I just wanted to brief them that we have got allocations in Assam, in Tripura, and in Manipur. These allocations are contiguous with our Mizoram mill. Definitely we will be benefited in 3-5 years once the plantations start yielding, because we are running Mizoram mill at a much lower capacity utilization than it was envisaged. The performance of the plantations is much better in Northeast. We get an OER which is at least 20% more than the OER we get elsewhere. Productivity also is 15%-20% more. We are in the process of setting up a seed garden in Assam. I think that is the benefit of NMOP. However, I want to point out that, Telangana and Andhra Pradesh have still not signed the, agreement with the central government. They are going by their old traditional formula. I'm sure that they have started suffering because most of the investments have started moving towards East and other states like Odisha and Tamil Nadu, which have signed the, NMOP agreement. I would like to add that, Chuck Schumer and Joe Manchin came to an agreement, and it looks that Biden's new bill is likely to pass in both the House and the Senate. This bill promotes the use of biofuels, including biodiesel and green aviation fuel, both of which will give a boost to vegetable oil prices. Got it. That's really helpful, sir. Thank you. I have one more question on Astec, but before that, I just wanted to clarify on the, you know, NMOP and the Northeastern expansion plans. Any rough acreage we have in mind, sir, over the next five years, how much we plan to add in the Northeast? If we say what is commercially possible in the area which we have got is close to about 12,000-14,000 hectares. We are still mapping because on paper what looks feasible, when we go and see the terrain, it may not be feasible. We are definitely planning for 10,000 acres, 10,000 hectares + in next 3-4 years. That is the plan. Got it. Apart from about 10,000-12,000 hectares in existing area. I see. Understood. I also want to tell you that we have doubled our nursery capacity. Today our nursery capacity was capable of doing about 5,000 hectares per annum, but next year onwards, it will be able to do between 8,000-9,000 hectares per annum. Lastly, on Astec, you know, if you could please just talk a little bit about this quarter's pressures or challenges in some more detail. I'll just add a couple more points that You know, Anurag, perhaps touch on. Also the outlook for margins, you know, given the price pressure indicated in one of the key products and also, the status of the ramp-up of the new herbicide plant. Astec's press release talks about commercialization of two CMO products this year. So are these from the herbicide plant itself or from, you know, some other source? Thanks so much. Thanks for the question. On the margin reduction piece in Q1, one of the primary factors as was highlighted in Astec Investor Call and in this call earlier was deferment of sales which happened in the Q2, because of some delays in deliveries and logistical issues, in some of our export assignments. That was one of the key factors. Other than that, in the mixed bag portfolio product which we have on few of the products, we were seeing increased raw material prices. There were high cost inventories as compared to the previous quarter, last year, which has also resulted in some margin pressures. The third component which also impacted our EBITDA or the margins were the increased cost structure on account of the new herbicide plant which we commissioned in Q2 FY 2022. Those were the three factors that contributed to the margin reductions. The deferment margins will be realized, obviously in Q2 and Q3, because it was a deferred sales. In terms of your second question on herbicide, plant utilization, we have given those indication in, Investor Call that we'll be utilizing the plants over the next, three years. This year also we would be, getting close to 60%-70% capacity utilization and working almost at full utilization by end of third year. That's the guidance and indication which we have given to the market. In terms of the CMO products, it was a mixed bag. There were few CMO products from herbicide plants, and there were one CMO products which were from other plants that contributed to the growth and margins. Thank you. Got it. Thank you so much and all the best. Thank you. We have our next question from the line of Aniruddha Joshi from ICICI Securities. Please go ahead. Thanks for the opportunity. Sir, on the Dairy, how do you see the profitability for rest of the year now that the Amul milk prices have started and since the oilseed prices also remaining high, farmers have no choice but to increase procurement prices. How do you see the outlook p lanning for Creamline as far as profitability is concerned in rest of FY 2023 as well as FY also. That is one question. Secondly, now animal feed prices, animal feed profitability has also reached to its lowest level in almost many quarters. Mr. Joshi. Your voice is not very clear. Can you repeat the question, please? Yeah. Is it okay now? Yes, please go ahead. The question is, milk procurement upcycle has started. Now, how do we see the profitability for rest of FY 2023 as well as, FY 2024 for Creamline? That is one. The second question is, the animal feed profitability is also at the lowest level in, many quarters. What are the initiatives to, improve the profitability, here? Yeah, thanks. Creamline Dairy, I think our woes are very similar to the woes of the industry, that the pricing is not able to catch up with the procurement cost increase of milk. Every week, particularly buffalo milk is breaking all records of price increases. Having said that, we continue to embark on our plan and whatever we had envisaged as a strategy. However, margins are not up to the level we wanted because of high cost of milk. If you see, we had almost 70% growth in value-added products, which historically had better margins than liquid milk, even though we had 20% growth in milk volumes also. Our salience from about 28% last year has gone to 39% as far as value-added products are concerned. I would say from strategy point of view, product mix up point of view, doing what is required by us, we are doing whatever it was we had planned, and we are executing much better than the plan also as far as volumes are concerned. The only problem is milk cost. There are two things which should happen. One of the thing is that, like we have 30-year data where the prices of milk start falling during flush, and the fall in prices are between 5%-10% every year. In some years it has been 13%, 14% also when the flush comes. That is where most of the dairy companies made profits. Now, this flush has eluded us for last two years. We believe because of high milk prices, and that is what we are seeing in our cattle feed tonnages also that there are more animals and people are taking good care of animals also. My sense is that this time the industry will see flush. However, having said that, I think there was an initial inertia and reluctance to increase prices. That, I think, the industry is coming over and adjusting to new normal. We have had two prices already in last three months. My sense is that in case the challenge continues, of course, the prices will increase. We are very hopeful that our losses will come down by Q2, and if we had a medium flush also, the business should become profitable in Q3. Q4 again will be a big quarter for us in value-added products. We would have commissioned additional lines. I am very glad to say that our value-added product sale was stunted in Q1 in spite of 69% growth, because in certain plants we ran out of capacity. That capacity enhancement has happened. We strongly believe that we will grow even more rapidly in value-added products in time to come, which has higher margins. Lot of things and lot of what I'm talking about rests in terms of margin on the flush. We are not too far. I think in 3-5 weeks time we should know the level and the quantum of flush, and we believe that some kind of reduction in prices will happen. In the animal feed business, I think we are back to normal profitability. Last year we did 6% EBIT on sales. I think in this quarter we will get to between 4%-5% EBIT on sales. My sense is that we'll end the year at 5%-6% EBIT on sales. Why do I say that? I think I can definitely share with you that we have an excellent position in DORB. We went wrong in soya because of external reasons, and DORB is rising every day and we have very good position there. I'm extremely confident that we will get back the margins which we lost. But for the soy material adverse impact which was there, otherwise in terms of the cost structure there has been no change in the animal feed. Volume will grow above 10%. I am very sure about that. Okay. Sure, sir. That is very helpful. Just last question. Have we also been able to take prices in shrimp feed also? Roughly what is our market share in shrimp feed now? Yeah. Thank you. Shrimp feed is a different story. This year the industry is in a little bit of flux because of late rains and because of floods after that. In some places the culture has been wiped out. We strongly feel that July is too early to give up. I think we are hearing that almost 40%-50% of the area is going for restocking. I'm still hopeful that shrimp feed tonnages will be back, and we will register about 10% growth over last year. Our market share will be about 3%-4%. Actually, it is very negligible considering Avanti Feeds and CP Group are the big people there. Coming back to margins and shrimp feed. Margins and shrimp feed will also improve because we also had a soya position there. The soya took a little 2-3 weeks more than in other animal feed business to get exhausted. Now, the margin improvement will be there. Having said that, I think, shrimp feed and fish feed in Andhra Pradesh, difficult to increase prices because, you know, in all areas, in all businesses, the Andhra Pradesh government is exerting their pressure. Everything they are trying to control. Even price controls are also there. I think our focus is only in rest of India, where this plant of Barabanki is in the process of commissioning. Unfortunately, this is a Chinese machinery, and the Chinese engineers could not come because of COVID lockdowns there. They have come now, and most probably in a week or so we will get to full capacity utilization, full commercial production. My sense is that, if in fish we will do much, much better than what we have done in shrimp feed, both margin wise and volume wise this year. Okay. Thank you, sir. Thank you. We have our next question from the line of Amisha Vora from PL Capital. Please go ahead. Hello. Hi. Thanks for the opportunity, sir. I had my first question was on our crop protection business. Last 4-6 quarters, you've been talking about improving channel hygiene, and, like, we've taken a lot of steps in that direction. Like, there has been some or the other reason for which this part of the business has been affected. I just wanted some medium term outlook and, like, if the management feels that our overdependence on herbicides is causing this issue with the business. Let me tell you three things about this business. One of the things is that definitely in this business, the external factors are very important. If you really ask me, the mess we have created is also because of internal factors, particularly in this business. I think we realized that our processes and the systems we have are outdated, and they were not in line, in sync with the way the dynamism had changed this industry. Which was also aggravated by the fact that because of COVID, we could not visit the markets, and we were totally blind. I think we goofed up big time in terms of tracking liquidation, tracking movement of material and particularly on debtors also, there was a sufficient loss of control. Corrections, definitely we got EY into the system. They are doing almost eight-month-long projects and put new systems and procedures in place with a lot of digital backups everywhere. The kind of visibility today I have in this business that was totally absent earlier. That's point number one. Point number two is that I think that visibility is giving us an opportunity to monitor everything in this business very closely. My sense is that hygienically, this year will be much better than last year and significantly better in terms of market hygiene. That said, I think there have been some changes in the team also. We have a new sales head and a new CEO in this business. Both of them have come from very big crop protection company. That is the second part. The third part is, yes, we are cognizant of the fact that our overdependence is there on herbicides, and that is why we brought Hanabi and now Gracia in this fold. I am extremely glad to tell you that Gracia, we have done very well. Last year we did 26 kl of Gracia. In the first quarter itself, we have done 40 kl. My sense is that we will do 4x-5x of last year in Gracia. Gracia is a wonderful product, and it will be driver of our growth and profitability in next few years to come. Otherwise, also in last one or two more in licensing products are nearing registration, which will be launched next year. We have been trying, and I've been telling on this call that we are fixing this issue, but unfortunately it took us longer than required. I think that today, whatever requires to be done in this business has been done. Right. Thanks. Thanks, sir, for that. My second question is on the feeds business, sir. We have had, like last 4, 6 quarters, there have been all kinds of ups and downs, but we've had very solid market share gains is on this side of the business. Now, like, you mentioned that sequentially margins are improving and, like, things are coming back to normal. Do we see these market share gains to stay, like, because you've had significant market share gains here? I must tell you that we will have market share gains definitely in three categories. Broiler is one which has driven our tonnages in the first quarter. Cattle feed, consistently, we are growing much higher than the market. My sense is with one more production facility in fish feed, we will definitely increase our market share in fish feed also, particularly rest of India. For your information, UP, Madhya Pradesh, Bihar are becoming big fish feed consumer states. With a plant there, we will have much bigger advantage because of lower logistics costs and lower raw material cost. I think this will continue. Layer feed, we already have a very high market share, and we will better it by a point or two or maintain that market share. That should be enough. I think that a lot of things are going right in the feed business. Of course, in commodity business you cannot get everything right all the time, so that is a debacle which happened in the soya meal business, but can't help it. We can just learn from it and move on. I can definitely assure you that profitability of 5%-6% EBITDA is not a big issue in this business. Right. Got it. Sir, my last question is on Astec. Mr. Anurag Roy clearly pointed out, like, what was the main contributors of margin decline this quarter. Like, more, like, sequentially and medium term, as the high-cost inventory is being used in this quarter, and, like, the teething issues with probably the herbicide plant having more fixed costs would also improve. What is, like, our outlook on margins going ahead? Anurag? Yes, obviously, we do not make any firm statements on forward-looking, but we maintain our position that our margins will grow in double-digit. Obviously you would have to realize that Astec is also in a lot of investment modes. There's a new herbicide plant, as you are aware, which has been commercialized. There is new CapEx which would be coming up. There'll be some impact on the PBT level due to increased CapEx. We hold our current outlook on at least double-digit growth on the margin as we move forward. Right. Got it. Thanks a lot, sir. Another big CapEx, which will be capitalized in Q3, will be our R&D center, which has cost us close to INR 120 crores. Sir, when you mention the R&D center, like, would there be, like, is it just for Astec or like, Agrovet B2C business, R&D would also happen there? Astec and CPB. I'm saying that we have a common R&D head for the whole company. The purpose was that ultimately in the animal feed business, whether it is fish or poultry or this thing, ultimately there is a lot of chemical technology which comes into play. I think all businesses will gain from each other, and the R&D center will be utilized in a much bigger way for Astec and CPB, but also for other business in some small way. Right, sir. Got it. Thank you so much, sir. Thank you. Thank you. We have our next question from the line of Falguni Datta from Jet Age Securities Private Limited. Please go ahead. Yeah. Good afternoon, sir. I just have one question. Can you share the volume in the animal, in the vegetable oil business, and also what was the realization for this quarter versus previous quarter? I'll tell you Q4 - Q1 no? Q4 over Q1. I mean, previous quarter. It's not a good comparison because Q4 is off- season. You can tell me both. I mean, I wanted to know the realization for Q4. Q4 realization. You can tell me the volume by? I'll tell you in the meantime, Q1 CPO volume last year we did 21,411 tons, and this year we have done 22,174. Revenue last year, Q1 was INR 241 crore in CPO, and this year is INR 309 crore. Realization, INR 1,13,000 a ton. CPO price this quarter was INR 1,39,000 a ton. Q4 CPO realization was INR 1,19,000 a ton. Contribution margin after variable last year was 15%, this year was 25%. This year was 25%. Okay. Sir, that, on the question side, that's all. I just wanted to know, in case I've just started following Godrej Agrovet since the past 2, 3 quarters. In case I want to know something on the some queries on the business, whom can I call? Because I have been trying but not getting through, so I just thought I'll check with you. Mr. Aditya Desai will connect with you. Mr. Aditya Desai. He's sitting right here, so now he cannot escape. Don't worry. Sir, will you just ask him to give me his number? I mean, landline will also do, on the call. Will do. Okay. Thank you. Thank you so much. Thank you. We have our next question from the line of Vidit from IIFL Securities. Please go ahead. Hello, sir. Good afternoon, and thanks for taking my question. Welcome. Sir, just in terms of data points, could you also give us the OER for this quarter? Oh, thank you for this question. We have done well. OER, Q1 last year was 17%, Q2 is 19%. Okay. Got it. I must tell you something. Normally, QRs should not be that high in June, but then since there were no rains. Hello? Since there were no rains, you had a higher. Got it. In terms of the animal feed business, now that soy meal prices have started correcting after the imports are being allowed, do you see the feed industry taking any price corrections, or this is what prices will be? Do we only see margin improvements and so on? No price increases have happened in poultry and layer poultry feeds. Price increases have happened in cattle feed because the de-oiled rice bran has risen sharply more than 15%-20% in last one month. Cattle feed industry is taking prices, and we have good position in DORB. In fish feed and shrimp feed, the price increases were due three months ago, but the Andhra Pradesh government is blocking that. Okay. We won't see any further correction from here because of decline in raw material prices. These prices or realization is just. No further correction because all the corrections have happened. Now, in case the prices go up, particularly we are expecting corn prices to increase. In case that happens, there might be an upward movement in poultry feed prices also. Okay, got it. Just finally, my last question was on Astec. You briefly touched upon margins of one product being impacted during the quarter. Just how long do you think these margins will remain impacted going forward? When can we, you know, expect margins of these, of Astec to get back to, you know, the 20%-23% levels? Hello. See, as I was mentioning, one of the reasons for margin impact was increase in raw material prices. There were some high cost inventory from the previous quarter, so that resulted in margin pressure. For the most part, those inventories have been liquidated. There is also some supply demand imbalance in terms of you know, the gap in the demand vis-a-vis supply. That is also creating some pressure on a few of our products. We expect, see, these are the normal volatility in the product portfolio which we have. Through strategic sourcing, through production efficiencies, we are very confident that we'll be able to make up for these margins. I think this is how we play in these markets, the product portfolio which we have. We feel that we'll be able to recover some of these margins as we get into the next quarters. Okay. Understood. Thank you so much for taking my questions. Thank you. We have our next question from the line of Deepesh Kashyap from Equirus. Please go ahead. Yeah. Hi, sir. Thanks for taking my questions. Firstly, on palm oil. In the last call, I think you gave a guidance of 17%-18% volume growth in FY 2023. Will you maintain that despite the fall in FFB arrivals that you saw in the first quarter? I think we have seen that FFB arrival varies with several factors, and one big factor is monsoon. If you ask me, my sense is that we will have 17%-18% growth in this business from CPO and PKO volumes. One driver of growth will be more FFB, and second will be more OER, because we believe that this year again, we will have some improvement in OER. That was one of my premise, and we still feel that. I think that, and we are very happy at the delay of the season, because normally when post-monsoon, the OER goes up significantly. The trees are looking very good. We have done another survey. My sense is that the recovery will start as soon as the rains have started. Some recovery has already started, and I think the season will shift by at least a month. Got it. Secondly, sir, on the animal feed segment, specifically on the shrimp segment, what was the price rollback that you guys, the industry did in the last quarter? Do you think, is there any other pressure to further roll back the prices because the soy meal is correcting? In poultry industry, the price reduction was between INR 2,000 to INR 2,500 a ton. In shrimp also, shrimp and fish, we had taken a price increase of INR 2,000 a ton, which the government forced us to roll back. Right. Is there a further pressure to roll back? Because I think the prices are further decreasing, right? No, I think so far everything is fine. I think we have just approached the government to take the prices up again. Let us see. Between, like, different states, I think Andhra is becoming very difficult to work with. That is 80% of the market. That is the main thing. Yeah, but that is why we are moving out. I must tell you that the dominance of Andhra in fish is only a few quarters away. Okay. Got it. I think everything is moving away from Andhra now, particularly in fish. Probably in case the attitude continues like this, the shrimp will also start moving out. Got it. Sir, lastly, sir, what is the CapEx expectation for FY 2023 and FY 2024? If you can give overall and also specifically for Astec, palm oil and animal feed segment that you talked about. CapEx, we have a CapEx of close to INR 500 crores. Of course, we are delayed in some of the CapEx for about 3-4 months in acquisition of land. Almost 60% of this CapEx will go to Astec LifeSciences. About INR 80 crores will go to oil palm plantation business, where we wish to put a refinery as well as solvent extraction plant, which will enhance our margins on oil further. We will quantify it probably in next 2-3 quarters. We are very, very optimistic because saving in logistics, et cetera, immediate processing of oil, reduction in FFA losses, which we used to have in transportation. That will add to this. INR 150 crores plus investment is coming in in our Dairy business. Not 50, it is much less. INR 30 crore or so. One more line in value-added products we are erecting, because in some of our products, we had run out of capacity in this season. That was very good news and we are very confident that value-added is going to be driver of our top line as well as bottom line in the Dairy business. The fish feed also you talked about that you're going to increase the capacity rates? Fish feed we have already commissioned this plant. Okay. Okay, got it. INR 500 crore you're saying for FY 2023 specifically. This is already capitalized. Got it. INR it. INR 500 crore is specifically for FY 2023 you said, right? Yes, FY 2023. My sense is these projects all. I think Astec is a ongoing project. How much of INR 300 crore or so we had planned for Astec will be deployed. Definitely the land has been bought, so that, one third of that is definitely getting deployed in next 2-3 months. Lot of equipment will have to be ordered because there is a, lot of waiting period, for the equipment. My sense is all this INR 500 crore definitely will be deployed in this year. Got it, sir. Thank you for answering the question. Thank you. Thank you. We have our next question from the line of Saurabh from Asian Markets Securities. Please go ahead. Thank you for opportunity. My question is on the Astec. The high cost inventory was related to the raw material or it was for the finished good? Anurag? Yes, it was related to the raw material. Now everything has been liquidated, so in Q2 we should not see any impact. Right. The second one on the deferment of about 20% of the sales. What kind of impact you know it had on this current quarter's margins? Maybe you know INR 100 billionto INR 200 billion, what could be the impact? Almost 20% of the revenue, more or less, you know, similar kind of profit margins, or the PBT has for the existing revenues and PBT which have been realized. Almost similar kind of impact on the PBT which was deferred into Q2. Okay. Is it everything for the enterprise business or was there element of the, you know, CMO business as well for the deferment? It was a mixed bag. Obviously, the enterprise constituted to almost 80% + of it. The balance was the CMO piece. Okay. The last one on the product prices also, what we are getting the feedback is the Chinese companies have started, you know, post their shutdown, the co-production. So there could be some pressure on the prices for product prices also. Has there been a trend that prices have come off in last one month? That's what I discussed earlier in this call, that we have been seeing some, you know, supply demand imbalances which is also putting pressure on margin. On some of these products we have a very strong footprints and very strong cost structures with our ability to backward integrate and deliver at the best prices and maintain our margins. We see this trend as normal in the market, the supply demand imbalances, and we have very clear strategic sourcing and production efficiency strategies in place to at least deliver on similar margin profiles. That's one. Second thing, we are also, as we are commercializing two of the CMO products, we'll also have some stable source of margin coming in from these products because for the CMO we typically work on cost-plus model which is typically margin immune to regulatory market. That's how we are planning to drive through the supply-demand imbalances as we move forward over the next few quarters. These two CMO product will get commercialized in Q2 or later? Excuse me, I think we are in the last 5-6 minutes of the call. Can we probably ask only one question or so per head so that everybody gets a chance? Sure. Thank you. We have our next question from the line of Kruti Karani from Axis Capital. Please go ahead. Hello, sir, this is Kruti here. Just a couple of questions from my side. On the animal feed margin, what should be the stable margin on a rupee per kg basis for you? Last year, we in animal feed, we made something like INR 1,700 a ton. I have a feeling that with 10%-11% volume growth, we'll end up close to this number, maybe 5% less or something like that, yeah. Okay. The RM rate pressure, like when by when it is expected to come down? By when do you expect the RM rate pressure in the feed margins to settle down? I think it is. I said that we have flushed all the high-cost inventory in the feed business. I think there is no mark-to-market issues anymore. I must also tell you, in case mark-to-market is there, that is all positive for us. I request you to come back in the queue. Sure. Thank you. Thank you. We have our next question from the line of Nitin Awasthi from InCred Equities. Please go ahead. Hello, sir. Just two questions from my side. First one would be the impact of lumpy skin disease on your business, both your feed business and your Dairy business, because you would have a better handle than anybody else, whether this is affecting or going to affect the industry or not. If so, how will it affect the industry? Very good question, my dear. I'm so happy that you asked about lumpy skin disease. One of the reasons why milk flushes did not happen last year was because of this lumpy skin disease at several places, and it has been underreported. According to us, it is much more, was much more rampant. But as it happens, most of these diseases are taken care of by culling animals, et cetera. I think that problem was grave about six months ago, but it is subsiding now. Okay. The reason I took this question up was because I was looking for precedents of how this disease was dealt with in the past in other countries. Some of these countries have very steps which India can't take. Some of these countries, like Israel, where they just culled the whole herd to get rid of the disease. That's not possible in India because that'll have a very big implication on the industry. You think vaccination will be the solution? Yeah. One of the big issues is that we continue with a lot of diseases because culling is not possible. I think vaccination and other remedies are there. I think in case you are more interested in this subject, I think we should talk offline. Definitely, sir. Definitely, we'll do that. The next question would be fish feed market share of the company. Mr. Awasthi, I request you to come back in the queue. 7%-8%. Definitely. Thank you. We have our next question from the line of Sumant Kumar from Motilal Oswal. Please go ahead. Yeah. Hi, sir. My question is regarding crop protection, and we have seen underperformance by Godrej Agrovet in crop protection in last couple of years compared to industry growth. Sometimes we have seen volume degrowth, and then we have seen margin contraction also. As compared to industry margin contraction, we are severely underperforming in this quarter and maybe in last couple of quarters also. For this side, what we are doing to protect our business, also a better margin profile? I think I answered this question earlier that I think a lot of our issues were internal, which we have addressed. Unfortunately, it took us much longer time to correct them because of two years of COVID, and last year we had failure of monsoon in July, which is our main season for herbicides. Having said that, I think at one time we had the highest EBIT margins in the industry. Definitely, I think that will be our aspiration to go back to that level again and balance our top-line growth and margin growth in future. Most of the corrections have been taken according to us, and let us see how this season plays out. In case what we are seeing in last 2-3 months and in the current month itself, that a lot of effort we have taken are yielding results. You know, this is a seasonal and cyclical business, so these corrections take a little more time. We get only one opportunity a year to sell herbicides. I think to judge us, you should give us one more season. Sumant, you may note that the margin is also a factor result of the composition. In the quarter one, the mix of our in-house product was less, and that sort of led to a compressed margin. It's a question of mix as well, the product. Okay. Thank you so much, sir. Thank you. Ladies and gentlemen, that was the last question. I now hand the conference over to the management for closing comments. 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 and stay healthy. Thank you once again for taking the time to join us on this call. On behalf of DAM Capital Advisors Limited, that concludes this conference. Thank you for joining us, and you may now disconnect your lines.