Ladies and gentlemen, good day and welcome to Godawari Power & Ispat Limited Q3 and Nine Months FY 2025 Earnings Conference Call, hosted by Emkay Global Financial Services Ltd. As a reminder, all participant lines will be in listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing star, then zero on your touch-tone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Akhilesh Kumar from Emkay Global Financial Services. Thank you, and over to you, Mr. Akhilesh. Good morning, everyone. Welcome to Godawari Power Q3 FY 2025 Earnings Conference Call. I would like to take a moment to thank the management for giving us the opportunity to host this call. We have with us today Abhishek Agrawal, Executive Director, and Sanjay Bothra, CFO. I now hand over the call to management for the opening remarks. Over to you, Mr. Bothra. Thank you, Akhilesh. Good afternoon, everyone. Thank you for joining us today for the Q3 and 9 Months FY 2025 Earnings Call at Godawari Power & Ispat Limited. Our financial results, press release, and earnings presentation are now available on our website and on stock exchanges. I believe you have had a chance to review the same. I will briefly take you through the results post which we will have a question and answer session. GPIL has maintained a stable performance over the past nine months despite facing challenges from lower realizations. Now, coming to key strategic updates for this quarter. The approval for mining capacity expansion of Ari Dongri mines from 2.35 million- 6 million tons is expected to be in place by Q1 FY 2026. GPIL has also restarted mining operation at Boria Tibu Iron ore captive mines, having a capacity of 0.7 million tons per annum. 0.6 million tons iron ore beneficiation plant for BMQ out of proposed 6 million tons capacity situated at Ari Dongri mines has also started. The increase in pellet plants capacity from 2.7 million-4.7 million tons is expected to be commissioned by Q2 FY 2026. The plan to set up a greenfield integrated steel plant with a capacity of 2 million tons has been dropped. Companies are evaluating different alternative projects with lower capacity and lower capex for which announcement will be made once the project is finalized. In addition to 70 MW solar power plant that is planned to be set up for additional capacity of pellet plant, an additional 25 MW solar power plant is also decided to be set up for additional power requirement of new beneficiation plant at Ari Dongri mines. The plan to venture into OPVC pipe manufacturing has been dropped due to changed market scenario. GPIL has completed acquisition of 49% stake in share capital of Jammu Pigments Ltd on a fully diluted basis as of 31st December 2024. The company has entered into an agreement with GAIL for supply of liquefied natural gas for GPIL's upcoming pellet plant for a period of seven years. The company is eligible to supply steel billets to all manufacturers of galvanized steel structures for the transmission projects of Power Grid Corporation of India Limited. CARE has assigned CareEdge ESG 3 rating with a rating score of 51. This is the first ESG rating assigned to the company. Now, coming to operational performance of the production guidelines set for FY 2025 for iron ore mining, iron ore pellets, sponge iron, and ferroalloys, the company has already achieved 69%, 73%, 84%, and 96%, respectively. Iron ore mining and pellet production dropped slightly, whereas production volume of sponge iron, HB wires, ferro alloys, and power increased on both quarterly and nine-month basis. In Q3 FY 2025, sales of iron ore pellets decreased on YoY basis due to shifting of export consignment from Q3 to Q4 FY 2025. Sponge iron, steel billets, and MS round decreased on YoY basis due to increasing production of HB wires. Sales of HB wires and ferro alloys increased significantly on both quarterly and nine-month basis. Pellet realization increased by 2% on nine-month basis to INR 10,387 a ton, whereas realization for other products were down in the range of 3%-8%. Now, coming to consolidated financial performance, on quarterly basis, our revenue, EBITDA, and PAT dropped due to lower production of iron ore pellets and dropped in realization of almost all the products except ferro alloys. On nine-month basis, the company achieved flat revenue of INR 3,908 crore. EBITDA and PAT was down on account of lower realization of finished products. Despite the challenges, EBITDA margin and PAT margin is too strong at 22% and 15%, respectively. The company has a healthy balance sheet with net cash balance of INR 725 crore. Now, coming to the market outlook for international iron ore scenario, as of February 25, the global iron ore market is experiencing notable shifts influenced by various economic factors. Recent trade policies, including tariffs imposed by U.S. and China's countermeasures, have introduced uncertainties in the global iron ore market. These developments could indirectly affect major exporters like Australia. The global iron ore market in 2025 is characterized by an anticipated decline in prices, increased production, and evolving demand patterns, particularly in China. Stakeholders should monitor these developments closely to navigate the changing landscape effectively. Domestic steel demand scenario: India's steel industry is navigating a complex landscape characterized by robust domestic demand, increased imports, and evolving global trade dynamics. India's steel demand is projected to grow by 8%-9% in 2025, driven by increased construction in housing and infrastructure sectors. While India's steel demand is on an upward trajectory, the industry faces challenges from increased imports and global trade policies. Proactive measures, including potential safeguard duties and strategic investment, are being considered to support domestic production and maintain market stability. To conclude, I would want to say that as we approach the end of FY 2025, we remain hopeful about restoring our pellet production and sales to previous levels. Our robust net cash position, combined with a well-planned CapEx strategy focused on substantially expanding our iron ore mining and pellet production capacities, provides a solid foundation for future growth. Improved operational efficiencies and cost savings from solar energy will further strengthen our performance. Moreover, the benefit of having captive iron ore mines and introducing high-grade pellets coupled with steadfast support from our stakeholders positions us for remarkable success in the years ahead. I would like now to open the floor for questions and answers. Thank you very much, sir. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on the touch-tone telephone. If you wish to withdraw yourself from the question queue, you may press star and two. Participants are requested to use handsets while asking a question. I repeat, if you wish to ask a question, you may press star and one. We have our first question from the line of Vikash Singh from Phillip Capital. Please go ahead. Good afternoon, sir, and thank you for the opportunity. Sir, I just wanted to understand that fine, that the steel, probably you have taken a call that now is not the right time. But for the plastic pipes, why, what are the difficulties we have faced for which we have to drop the project? And now, since both the large-scale project has been dropped, what is the plan for the cash which we are holding? Okay. Good afternoon. So just to correct, the pipe project was not a very large scale. It was a small CapEx of about INR 125 crore. So the reason we have dropped the OPVC project is so when we had entered into an agreement with the equipment supplier, that time, hardly there were any manufacturers in India who were previously aware and others had ordered any machines. What has happened is suddenly Chinese technology came into India, which we were not aware of. And now there is a slew of orders given by different companies who are already into the pipe segment, be it local, say, Bajrang, Sambhv, be it bigger, they got Apollo. So now the, I would say, the USP where you may thought we'll get an advantage of, say, at least a year to two years, where we'll be the first mover, the advantage has totally gone away. We were totally blindsided by Chinese technology. And that's the reason we decided we want to drop this project because the first advantage will not be in there, and everybody's putting up a pipeline now. So again, as in India, we thought since we are not very strong into the pipe business right now, let's enter into a segment where we have to start working from scratch. The whole idea has been dropped. The CapEx was about INR 125 crore, out of which we have only spent INR 14 crore on the order of equipment, where we have already spoken with the supplier, and he has agreed to return the money in due course of time. So there will be no financial loss to the company, and that is why we have dropped the pipe project for OPVC forever. That's the whole reason behind it. Understood, sir, and now the plans for the cash because our cash generation would be higher. Yeah, just to add, yeah. So see, the idea of dropping the 2 million steel plant was, as a management, I want to be very honest, the CapEx we initially we got it wrong. So usually what happens, we thought 60% is equipment cost and 40% will be the infra cost. But what has happened is it is opposite. So 40% is your equipment cost and 60% is your infra cost. So the entire CapEx, which is about INR 5,000 crore-INR 6,000 crore for a 2 million plant, will now probably cross INR 8,000 crore. So with so much of capital investment, where we would have gone to the bank on a long-term basis to keep the project running on time, we don't want to go back into the same debt cycle which we had entered last 10 years back. We thought to drop the project, but the entire project is now dropped. We are revisiting, re-allocating on a smaller capacity, say, from 0.8 million-1 million tons, and that will be announced in due course of time because we want to invest in steel, value-added steel, but with a smaller CapEx so that we don't have to take a long-term loan from the bank. That's the whole idea. Understood, sir. What has happened is, just to add to it, there is the delay to acquire the land, and the EC has been very long now, and unfortunately, luckily, I would say, during this course, the market also reversed quite a bit. There were a lot of addition capacity by the big players in the pellet segment, so I thought it is the right opportunity that we actually take a call, so we went to the board, we discussed on this, and that's why the communication to the shareholders. Understood, sir. So how much do you have already spent for the steel plant? Any money? Nothing, nothing. Very peanut. We have done some license, some approvals, and certain plantation and all, as per government, and the value is hardly below INR 1 crore. As if nothing is spent on the new steel plant, certain consulting fees and all, which is very minimum. Understood, sir. So second question in regards to pellet pricing. So last one, one and a half months, we've seen that the international iron ore prices have been continuously increasing. So just wanted to understand over CQ versus current pellet prices and how's the mix between export or domestic, if at all, any exports you are doing right now? See, we did export a shipment last quarter. December, we started exports. Primarily, what has happened is post-Diwali, usually the steel market, usually the demand picks up. But this time, the demand was quite sluggish. So what has happened is the demand of pellet was quite weak in the domestic market because new pellet plants, multiple pellet plants, also got commissioned in Chhattisgarh and around Chhattisgarh. So that is the reason the pellet sales in domestic markets were quite weak, and we had to export one shipment which got loaded in the month of January. Right now, we are not exporting anything because the domestic. So what has happened is with the news of duty being put on steel before the budget, the domestic market picked up slightly, and there was a good demand of pellet. So we have booked in domestic market, and we are not exporting pellets anymore. Understood, sir. And so spot prices versus CQ average, what will be the difference, positive or negative? Okay. So if you export right now, the realization will be about INR 1,000 less compared to domestic market. Noted, sir. On net level, you are talking about? Yeah, net level, of course. Understood, sir. So just one more question on the Boria Tibu side. So have we completed the beneficiation plant basically there, and the capacity has been started? See, actually, the whole logic behind starting the Boria Tibu was there is no beneficiation plant in Boria Tibu right now, and we have plans to put up one, but that will take about three, four years down the line, as we have declared earlier as well. So what we've done is we have created the circuit in Godawari to beneficiate the Boria Tibu ore because the Boria Tibu ore is of low grade. It's about 55% average. So earlier, we couldn't beneficiate that ore, and we had to blend it in our charge mix. But now we are beneficiating that ore and raising it to 65% concentrate. So that is why we started the mines again and bringing the ore to Godawari and beneficiating along with other iron ores. Understood, sir. And so just one last question. Given that the domestic prices of iron ore have been a weaker trend while the international is improving, so what's your take on the domestic prices? Whether do you see a spike of domestic prices going up or the demand is still too weak for any such thought process? See, in the international market, the prices have not moved that much. It's hardly 5%-7% here. The low was about 97%-98%. When China was on holiday, right, it's about 106%. So it's hardly 7%-8%. So I won't say it's a substantial increase in the international market. The domestic market, there is a shortage of iron ore, and it will continue to remain until the supply starts improving. But demand is still there. There's still a big gap between demand and supply. The domestic iron ore pricing is still very strong compared to the international market, which is because that, in turn, will keep the pellet price on the higher side. Noted, sir. That's all from my side. I'll join the queue for further questions. Thank you. Thank you. A reminder to all participants, if you wish to ask a question, you may press star and one. The next question is from the line of Manav Gogia from YES SECURITIES Limited. Please go ahead. Yes, hi. Good afternoon, sir, and thank you so much for the opportunity. Just building upon Vikas's question on the steel plant, you mentioned that your, according to your computations, it came out to be around INR 8,000 crore. So did this include the coke oven as well? Because as I recall, we were not setting up a coke oven prior. If you are aware, about a month back, Government of India has restricted the import of coke into India to merchant cokeries in India, right? So merchant cokeries have been to help them, support them by imposing certain amount of duties. So what has Indian government done is they have limited the quota of imports from respective countries for a period of six months. So basically such policies, we were forced to put up a coke oven because if the restriction continues for a longer term, we can't import coke, and then you have to buy coke from the local cokeries, which will increase our operating costs by substantially. So unfortunately, we had to envisage the CapEx for coke oven during the final discussion which happened because of the government changing government policy. Sure, sure. So that is basically the change. The CapEx is almost close to INR 1,000 crore, which is substantial. Sure, sure, sir. And sir, as I recall from one of our past calls, we had stated that the minimum requirement that the company needed to set up an HRC plant was for two MTPA. So now, how with the new, how currently the discussions are going for the new plant, what sort of route are we going to go for? Will we still go for an HRC plant, or are we evaluating to expand? No, no. So to be honest, the way primary producers have been increasing their capacity, for example, NMDC has started their 3 million plant. JSPL has started their 5 million plant, and about 20 million further capacity is going to be online in the next couple of years by the big guys. So we have completely dropped the HRC project because it's no point going for a narrow section with flat. It has to be a complete range of products from 1250 to, say, 2 m. So we have dropped the HRC product. We are exploring other products in flat segment like structures, heavy structures, beams, and at the same time also the long products because we're all into long market, so we know how long market works. So we are evaluating on both sides, and once we decide, we'll probably inform all the shareholders. Okay, okay. Sure, sir. So. But HRC is definitely out of the picture now. We're not going to go ahead with HRC now. Okay, okay. Got it. That was very helpful. Thank you so much. So the other question comes on the pellet plant which we are about to commission. I think about majority of the CapEx is still about INR 432 crore balance which has to be anchored probably over the next couple of quarters, I assume. So I wanted to know, are we going to do it? What's going to be the split between Q4 and Q1 if that is something which you have in mind right now? See, in terms of CapEx, the CapEx is ongoing. We have already started the erection of the equipment. So probably depending on, so China shipments are starting to be received from all the suppliers. So we envisage the pellet plant will start trial production by early Q2, and by end of Q1 for FY 2026, the entire CapEx will be done. So between Q4, which is already going halfway, so next four months, the entire remaining INR 432 crore will be spent, and we are confident we can start the trial production of the new pellet plant in FY 2026 Q2. Sure. And sir, how much time do we expect from the ramping up to full utilization levels for the pellet plant? See, three to six months maximum. So end of probably Q3 or mid of Q3, we can expect the full production. Got it. So from FY 2027 onwards, we can expect the full flow of volumes to kick in? No. I think in the worst case scenario, I think Q4 to FY 2026 for sure. Sure, sir. So just following up on the CapEx, we were right earlier, I read about the role of CapEx expectation for FY 2026. Now, are we looking to cut that number down considering the steel plant is off the charts? So what sort of a CapEx can we expect for FY 2026? See, so the mining, the beneficiation in the mines, along with about 95 MW of solar for mining as well as pellet, and the remaining CapEx for the pellet plant. So all these will be incurred in next three quarters, which is Q4, FY 2025, and remaining will be probably for FY 2026. So roughly about so solar will take about INR 10 crore, and mining, which is about INR 150 crore, balance will be incurred, and about INR 400 crore. So about INR 850 crore-900 crore of CapEx will be incurred in this quarter and next financial year. Got it, got it. Everything will be in general accrual because we still have a healthy balance sheet, and we are generating enough free cash flows on every quarter. Sure. Thank you so much, sir. Thank you so much. Thank you. From my end, I'll join back with you for more. Yeah. Thank you. We have a next question from the line of Sahil Sanghvi from Monarch Networth Capital. Please go ahead. Yeah. Good afternoon. Thank you for the opportunity. My first question is, sir, we are seeing a drop in the realization of pellets in Q3. Now, if I check the steel and TMT rod prices, I don't see that kind of Q1 Q2 drop in YoY. It's quite flat. So if you can help us understand, because the drop in prices really hits our margins. So what were the reasons for the low price for pellet? So I'll tell you what has happened in Q3, especially what has happened this post-Diwali. We were expecting the steel demand to go up, which rather it happened the wires versus slab side. And a couple of new pellet plants, merchant pellet plants, got commissioned in the iron sector, right? So there was an oversupply of pellets, and because of sluggish finished demand, the uptake of pellets was not very high. So we had to export a vessel. We were carrying an inventory of more than about 53,000 tons, which never happened. Usually, it doesn't happen. So cut down on the inventory, we've exported a vessel, and end of December, the market picked up, and we have a healthy order book. So it was a one-off situation where prices were a little corrected, plus we had a cost due to our higher inventory than we maintained. So because of all these factors, it impacted the EBITDA for Q3. But I'm confident going forward, Q4 you will see a much better result compared to Q3. Right sir, and would you be able to give us a quantum of the dispatches or the export shipment as in because we were expecting the production to be somewhere around 440,000, 420,000 per pellet, which we have done around INR 3 lakh. So. No, no. INR 3 lakh is the sale. It's not that production. Production is very much within the range. Sale was down because the inventory is almost reached about a lakh ton. So finally, we exported a vessel, and now the inventory is down to below 2,500 tons. So all the carrying forward inventory from Q3 will be sold in Q4. We have no intention to export further because domestic demand has again picked up, and we have a healthy order book till March end. So all the inventory will be cleared, and the carry forward EBITDA will be seen in Q4 going forward. We are sticking to the 2.44 million tons? 100%. So whatever guidance is given in terms of production volume and sales, we are sticking to that, and we will achieve that for sure. Got it, sir. And like the kind of, say, the supply surplus kind of situation you faced in pellet for Q3, do you think that could come again because we'll be unleashing a big supply of pellet once our new pellet plant comes in? So do you find. That is quite possible because eventually, pellet is a part of supply chain, so we are very well prepared because the new pellet plant will be producing high-grade, so we have a bigger market in India, people, bigger players like JSPL, coastal movement, and of course, export is always open, so we are prepared given the situation. We have to send something out of Raipur. We will do it. There might be some sudden, probably impact on the pricing, but in the longer term, we don't see any challenge because our mines should be fully operational by then, so our input costs and our operating costs will be very healthy, so we can always keep making money. See, here, INR 1,000 here and there is not a big difference, but with such a volume, things can happen. Sometimes the demand is good. Sometimes the demand is bad. So we have to be prepared for all the situations. Right, sir. Sir, if all things go by our plan, and Q1 is when we get the EC from mining, so we don't intend to start, I mean, the pellet plant will start only in Q2 after we get the EC, right? I mean, we don't intend to use the Boria Tibu for the pellet. See, see, I'll tell you. Even after the mine, once the mining EC is received, we will need a few months to ramp up the capacity. So, pellet plant, once it gets operational, right, usually takes three to six months to get stabilized. So, if there's a situation, we are on shortfall of iron ore for the trials, and we will buy from the market. So then we will have a very temporary phase, hardly probably say three to four months. So I don't see a challenge because even pellet plant will take some time gradually to reach the maximum capacity. Got it, sir. And lastly. If we have to take the miner from the market for the trial, then we will buy it. No big deal. Got it, sir. And lastly, sir, what gives you this surety or a certainty that we will receive the EC for mining by Q1 FY 2026? Okay. So there was a desired approval by the state government where eventually they referred the case to the Mining Ministry and eventually the Law Ministry. So that took almost six months for that desired approval or a recommendation from the Mining Ministry in our favor. So that approval has been received by the center, by the state government now. So now everything is started on a very rapid pace. IBM has already approved our new mining application. So we are very confident by Q1 we will get the EC. The major hiccup was that approval from the center. That approval has already come two months back. So now we're confident we will get the EC by Q1. Got it, sir. Thank you. Thank you, sir, for answering my questions in all detail. Yes. Because we do understand the entire business of right now, Godawari, is based on the mine side. So it's still impacts our EBITDA level. Right, sir. Right. Thank you. Right. Thank you. Thank you. We have our next question from the line of Siddharth Gadekar from Equirus Securities. Please go ahead. Hi, sir. First question on the public hearing, have we received any date for the public hearing or that is still one or two months away? Okay. Last week only, IBM has given, accepted the proposal. Now the State Pollution Board will issue the final guidelines along with the public hearing. Expecting the public hearing to be announced probably in the next couple of weeks. We expect the public hearing to happen somewhere in post-Holi, end of March. Once that is done, in a couple of months, we'll get the EC. As I said, everything is now moving on a very rapid pace. Okay. I got it. So secondly, our crushing and beneficiation comes online six months after the EC approval. So how should we think about the ramp-up of the new pellet capacity? Will we be buying iron ore from outside till then, or how should we think about our operations? Just to give you a very clear picture, so the new beneficiation plant, there are two parts. One is 1.5 million beneficiation of BMQ, which is the low FE iron ore of 35 FE. It's called banded magnetite quartzite, out of which 0.6 million is already being commissioned, and the plant is already running in full flow. Right? The remaining 0.9 million of BMQ will take about six months after getting the EC to commission the plant, right? Parallelly, there's a 4.5 million beneficiation for the iron ore lumps. So till the beneficiation gets completed, which is about six months, we'll keep sending the iron ore, which is about 60-61, to the plant where we already have the capacity to beneficiate. So once the plant is commissioned in mines, so we'll stop beneficiating in Godawari, we'll start beneficiating in mines. That will help in reducing the cost. So that's the whole idea. So, there will not be any impact in terms of our because of the delay in beneficiation that our mines? No, no, no. There will not be. There will not be because we already have a capacity in plant premises to beneficiate the raw material. The beneficiating in mines will help us in reducing cost. So we have started investing in mines. That's the reason. Secondly, in terms of our beneficiation cost, can you give us some sense what is our beneficiation cost from going from 35 to 65? Briefly. So my delivered cost to my plant currently, which I'm beneficiating, is about INR 2,200 after beneficiation. The royalty in this would be around INR 50? No. See, the royalty is payable on the dispatch. So we are beneficiating from 35 to 65 in the mines. So we are paying royalty of 65 concentrate, which is about INR 750 as per IBM. Okay. Okay. Because we are not bringing 35 to the plant. We are beneficiating 35 in the mines itself and dispatching only the concentrate of 65 grade. Okay. Got it. Got it. So secondly, just one more question around this, that if we transport the low-grade iron ore to the plant, our royalty rate will reduce drastically, right? See, royalty will reduce drastically, but what will happen is now if you beneficiate the low-grade into at the plant side, you are incurring a cost of INR 1,000 on the transportation. So the transportation cost will go up 2.2 times. So saving the royalty of INR 500, but you will lose up INR 1,500 on the transportation. Okay. Okay. Okay. Got it. Got it. Yeah. Yeah. Yeah. Yeah. Okay, so secondly, now, given that we are really working on our steel plant CapEx, how should we think about the CapEx numbers over 2026 and 2027? See, for FY 2026, the mining, the beneficiation, the pellet plant, the solar for both mining and pellet plant, and few other energy efficient capex, which we have beneficiaries, that all will be done in FY 2026. So roughly a capex of about, say, INR 1,300 crore will be spent in FY 2026. And for FY 2027, hopefully, we are able to come up with a concrete plan for the revised steel capacity. And if we are able to get the EC, so that expansion will happen in FY 2026. But major expansion will start from 2027. So depending on the revised steel capacity, we will come with the revised capex plan. So, but any ballpark numbers? Sorry, sorry. Sorry. Go ahead. See, for example, if we do a 0.8 million capacity or a 1 million capacity, the figure will be somewhere about INR 3,500 crore-4,000 crore. Okay. Okay. Got it. Basically, you can consider INR 400 crore to INR 450 crore per lakh ton of steel. So for a 0.8 million, INR 3,500 crore. For a 1 million, probably INR 4,000 crore. That's the ballpark figure. Okay. Thank you. Yeah. Thank you so much. Thank you. Ladies and gentlemen, in order to ensure that the management is able to take questions from all participants in the conference, please restrict yourself to two questions per participant. Should you have a follow-up question, we request you to rejoin the queue. The next question is from the line of Mohd Sheikh Sahil from IDBI Capital Markets. Please go ahead. Hi sir, thanks for the opportunity. Can you please provide the guidance for FY 2026 in terms of revenue and EBITDA margins? See, FY 2026, so earlier we had in sight, the mining will start in FY 2026 and the pellet plant. And unfortunately, the mining will not start till at least Q2. So in terms of revenue, you can consider probably additional production of, say, about 0.5 million-0.6 million of pellets for the new pellet plant. So probably we produce about 3 million pellets. So that additional revenue will be added. And see, EBITDA, we expect to, in the current market scenario, to be somewhere probably you can add the additional volume which will come from pellets. There's additional EBITDA thing you can add. So not much improvement compared to FY 2025. But for FY 2027, there will be a substantial jump because the mining will be at full capacity and the new pellet plant will be at full capacity. Okay. And what are we targeting for FY 2027 margins? FY 2027, to be honest, for a 4.5 million capacity of pellet and plus additional everything, bare minimum is about INR 1,500 crore-INR 1,000 crore of EBITDA FY 2027. But of course, see, it's a very, very, I would say, it's a very assumption-based because you don't know what the market's going to be in the next 15 months being a commodity market. But yeah, as per current market scenario, you can easily assume an additional EBITDA of close to INR 600 crore from the new pellet plant. Okay. And, Sir, secondly, the second question is regarding Jammu Pigments. Sir, what was the contribution to the top line for that subsidiary? Sorry, can you please come again? Sir, in regards to Jammu Pigments, sir, what was the contribution to the top line, any in terms of percentage? See, what happened this quarter, Jammu Pigments, in Jammu Pigments, we have acquired only 21.46% till December 2024. So the top line is not added line by line. It is considered as a joint venture company. The share of profit is only considered in our numbers. And this acquisition was made on 20th November 2024. So for a limited period of 40 days, around INR 50 lakh profit is considered as a share of profit from joint venture company. Okay, sir. Got it. Got it. Thank you, Sanjay. Thank you. Thank you. Thank you. A reminder to all participants to restrict yourself to two questions per participant. The next question is from the line of Jash from Dalal & Broacha. Please go ahead. Yes. Hi, sir. Thank you for the opportunity. So my question is on the steel plant. So earlier, there was a lot of back and forth on the steel plant, and now we have finally decided to drop it. So was there any concern from the environmental clearance perspective? Because we were expecting we had a lot of delays on the environmental front. So was that a case, and that's why we are dropping, or is that because of the higher CapEx? See, there are two things. One is if you have got the environmental clearance last year, we would have definitely started the 2 million project. And of course, we would have. But in the meantime, what has happened in the last 12-15 months when we have done the detailed CapEx planning, we revised our envisaged number was not correct, right? So from INR 6,000 crore, bare minimum is about INR 8,000 crore. So that is one probably mistake I would admit was done from our side in envisaging the initial CapEx. Plus, with the current market scenario, with so much of steel capacity on flat segment only added by primary, which is coming online already and coming online in future, we decided it's better to probably look at some other products rather than competing with the big guys. These two situations, there was a reason for us to scrap the 2 million project. Right. And sir, because Ari Dongri mines will be coming on board in FY 2027, and so because of that, sir, we are venturing into this steel CapEx. So are we confident that we will be on this one million ton that we are envisaging will be on that frame so that the earnings don't take a hit? No. See, definitely, we want to invest into steel because eventually, so much pellet capacity is also not right, right? You put everything in one basket with so much of pellet as a merchant sale. So you want to convert a pellet into value-added steel with a lower CapEx. So the idea is not to brownfield, convert a pellet into value-added steel, and go with the lower capacity. So the steel plant will definitely come up. The key is, we probably will need some more time to come at a concrete plan and a concrete CapEx. Right. Okay, sir. Okay. Thank you so much, sir. Thank you. Thank you so much for understanding. Thank you. Thank you. We have our next question from the line of Aditya Welekar from Axis Securities. Please go ahead. Yeah. Thank you for this opportunity. Sir, my question is with regard to this drop in the realization of the pellets. So you alluded to that the pellet capacity coming in the vicinity of Raipur and in Chhattisgarh. So in the medium to long term, structurally, do you see any risk from these pellet plants coming up and putting pressure on the pellet prices structurally going in future? And how easy for someone is to put the pellet plants? Do these pellet plants have the iron ore as a backward integration, or people can set up the pellet plant and it can put risk to our pellet price realizations in future? See, firstly, buying fines in the market and investing into pellet plant, I don't see a business proposition there. I don't see it's always going to be a struggle to buy fines in the market and make money in the pellet business. In our case, because we have captive iron ore mines, so our 100% iron ore is from captive, so we will always be making the money, right? And in terms of competition, there will be competition because see, even Lloyds is coming with a 4 million plant in Maharashtra, right, which is very close to Raipur, right? So even he'll be targeting the areas around Chandrapur and Chhattisgarh. So that is the reason in the longer term, we want to hedge our pellet bets and use those additional pellets into captive steel making in the longer term. Okay. I understood, sir. So that was the only question. Thank you. Yeah. Right. Thank you. Thank you. A reminder to all participants to restrict yourself to two questions per participant. The next question is from the line of Chirag Singhal from First Water Fund. Please go ahead. Yeah. Hi. Am I audible? Yes. Please tell me. Yeah. In these two questions from me, first is on the industry. So can you please share what was the pellet capacity that was commissioned over the last one year and how much capacity are you expecting to come up, excluding our expansion in the near term? Okay. So the capacity which has come up in the last 12 months is close to about two million tons, and which is I'll tell you there's another difference also. What has happened is now, so for Odisha people, the merchant pellet plant, Bengal was a big market for them in terms of the pellet sale. What has happened is in Bengal, every steelmaker has invested in a pellet plant, and now rather than buying from Odisha, rather they are selling in your market now. So a buyer has become a seller. So what has happened is all the Odisha pellet plants are now focusing towards Chhattisgarh because that is the closest to them. So that is additional volume which is coming to Chhattisgarh from Odisha pellet makers. That is one reason. Secondly, in terms of additional capacity which is added, so there's another Lloyds is four million tons, which will come up in again Q1 of FY 2026. And in Raipur itself, additional capacity of 2.5 million tons is also coming up. So put together, Lloyds plus commissioned two million and an additional of 2.5 million. So apart from Godawari, about eight million tons of pellet plant is being commissioned in the next six to eight months, which is a good capacity. Eight million tons of additional capacity, excluding Godawari? Excluding Godawari. Commissioned and to be commissioned. Okay. So this includes two million tons, which has already been commissioned? Yes. Yes. two million already commissioned and another six million will be commissioned in the next six to eight months. Understood. And what is the total capacity in India and how much of that is exported? Currently, the pellet capacity in India, installed capacity is close to about 150 million tons with the average realization of 80%. So I think in FY 2025, India probably will produce about 110 million-115 million tons of pellets. Export is hardly because only port-based players like BRPL or say Mandovi, Goa or say ArcelorMittal, only these players are exporting certain volumes because for them, being at the port, the logistics cost to transport the material from inland to port is bare minimum. So those plants become commercially viable for export. But apart from that, right now, there's no export of pellets happening from India. Understood. And my second question is on the price trend. So you mentioned that the prices were lower during Q3 because you had to export more because of the overcapacity. Now, if I look at, let's say we are now going to have the normal realizations because of higher domestic sales. If I look at the SteelMint data, prices are almost flat for the quarter versus previous quarter. So is it fair to assume that our NSRs will be at least higher by INR 1,000 over the reported quarter, which is Q3? We only exported 50,000 tons of pellets against a volume of 3 lakh tons, which is hardly about 18%. So for average realization of Godawari in Q4, the impact will be bare minimum. But what has happened is the volumes which are accumulated in the plant as inventory in Q3, all those volumes will be sold in Q4. So the Q4 volumes plus additional Q3 inventory volumes will be sold in Q4. So that will still have a substantial EBITDA for Q4 in Godawari. Okay. So you are saying that in Q4, we should not expect a lot of improvement in the pricing versus Q3? Yes. Pricing will not be substantial difference, but the volumes of sale in Q4 will be much higher compared to Q3. Substantial difference will be there. Got it. Got it. Okay. That's it from my side. Thank you. Thank you. Thank you. A reminder to all participants to restrict yourselves to two questions only. The next question is from the line of Suraj Khaitan from SKP Securities. Please go ahead. Hello. Am I audible? Yes, please. Sir, so my first question was for the pellet plant. So we actually sell high-quality Fe content pellets. So it uses less of coking coal. Now that prices of coking coal have gone down, how do you see this thing? Because if coal prices are up, high-quality pellets are more in demand as it saves costs on coal. So was that also a reason why our pellet sale has gone down apart from the new plant that has been set up? So see, I'll tell you, as soon as you leave for Godawari, the pellet sale has been in the domestic market where 90%, 95% buyers are of coal-based DRI, right? We hardly sell pellets to any blast furnace, right? We do get orders here and there, probably once in a couple of months by a blast furnace firm. For example, currently, we are issuing orders for JSPL Raigarh for the blast furnace, right? So the pellet pricing for Godawari is totally based on the domestic market, which is coal-based DRI, right? And there is substantial demand because our pellets are low alumina and low phosphorus for which we continue to drive the same premium as before. The only reason the sales were down, so you can see an impact on the numbers. When the sales are up, you'll see you won't see a difference in the numbers. Sir, my second question is regarding the expected capacity utilization after the new plant is set up. So what is the guidance for FY 2026 and FY 2027 for this pellet plant? See, FY 2026 will continue to produce about 2.4 million-2.5 million from the current capacity, and you can see additional 0.5 million-0.6 million from the new plant. So about 3 million-3.2 million of pellets we can assume in FY 2026. But FY 2027, we will produce full capacity of, say, 4 million-4.5 million tons of pellets. Sir, my follow-up question will be regarding the margins of each product. We are selling five products. So how much margin are we realizing from each product, like for example, pellets, HB wires, and MS rounds? See, pellet, in an integrated market where everything is stable, we do about. Our pellet cost is about INR 6,000 per ton, and the average selling price is about INR 10,000. We make a margin of about INR 4,000 on pellet on ex-works basis. We sell finished, which is wire or HB wire. If you see from sponge iron because sponge iron is captive. From sponge to a finished sale, and with all the infra and the power cost, we make about INR 5- INR 7 there. INR 4 from pellet plus additional INR 5- INR 7 from the steel capacity. Okay. And thank you, sir. And one more question was regarding who are the top three players whom GPIL sells pellets, and what is the percentage? May we please request you to rejoin the queue? Okay. So the top three buyers for GPIL, so Prakash Industries, which is in Champa, has been a big buyer. Plus, there are a couple of local guys. One is a group called Real Ispat Group, which is a big buyer, and another group called Karnikripa. So all these are domestic players which are the major buyers of Godawari pellet on a long-term basis. Thank you, sir. Thank you. Thank you. Ladies and gentlemen, please restrict yourself to only one question per participant. We have our next question from the line of Rakesh Roy from Boring AMC. Please go ahead. Hi, sir. So my first question regarding this is just to check. So the new pellet plant is we are increasing from 2.7 to 4.7, no? Right. Correct. Yes, sir, and you are saying for FY 2026, we will do from 2.7. We will go nearby 2.4, 2.5. And from. No, no. What I told you was, so current guidance, if you see from last two years, it's about 2.5 million tons of pellets we are doing, right? 2.5 plus additional, say, about 0.7 million- 0.8 million tons from the new plant because the plant will get commissioned in Q2. It will take about six months for stabilization. So you can consider a 40% capacity. So FY 2026 will do about 3 million- 3.25 million tons of pellets. But FY 2027, we should do about 4.5 million tons of pellets. Okay. And sir, this is just pellet plant. So for new pellet plant, we have targeted with GAIL. Is it totally gas operating now? Yeah, we have done an MOU with GAIL. Currently, we use producer gas as a fuel for pellet plant. For the new pellet plant, we will switch to natural gas. Depending on the commercials and how the plant performs, given the situation, we might convert the entire three pellet plants to natural gas. Okay. It depends on the operating scenario going forward. Definitely. Okay, sir. If we use gas, definitely our margin will improve. How much margin are we looking for, improvement in margin? Now, see, to be honest, natural gas for India, especially for where our plant is, will never be cheap because natural gas is imported into India, then there is logistics cost. So commercially, there will not be any benefit by switching from coal gas to natural gas. The only reason is going forward with so much of capacity, if we have to export. So we're looking at if you look at the Europe market, the CBAM will be in place from January 26, right? So looking at all those scenarios, we want to start natural gas. And in longer term, probably we'll see if there is saving or there is no saving. We want to keep options open. Thank you, sir. We have our next question from the line of Yogansh Jeswani from Mittal Analytics. Please go ahead. Hi, sir. Thanks for the opportunity. Am I audible? Yes, please. Yeah. So Abhishek, sir, can you also share how much was our contribution from the high-value export that we used to do? And how will that shape up given the entire scenario that you have discussed so far in terms of new capacity coming in and we also coming up with the beneficiation plant and bigger pellet capacity? See, currently, our high-grade production is about 65%. 35% is the 63 grade, right? The new capacity, which will be coming up, will be totally high-grade. So going forward, our high-grade will be close to about 80%, and 20% will be of the commercial grade, which is in the domestic market. We are open with options of selling high-grade in the domestic market if there is a demand. If there is no demand, we are also open doing exports. Obviously, we're trying to pick players like the blast furnace guys like JSPL, Tata, if there is a demand in the market. So the options are open. The quality is there. We deserve a certain premium. So depending on the situation, we will keep selling it there. To be honest, we really can't be fixed about if we have to export or we don't have to export. Depending on the expanded realizations of the focus of the companies to realize the maximum value of every ton of pellet we sell. Thank you, sir. Ladies and gentlemen, please restrict yourself to one question per participant. We have our next question from the line of Manav Gogia from YES SECURITIES Limited. Please go ahead. Hello? Yes, sir. Please raise the question. Hello? Yes. Thank you once again for the opportunity, so one question I wanted to add to wanted to ask was on the maintenance shutdown that we did for Q2 for the pellet plant. Were there more days during Q3 as well where we did some shutdowns in place? See, I'll tell you what happened. There is a big annual shutdown, which we usually take during the monsoon. There might be small shutdowns of three days, four days for certain maintenance. That's an important part of the business. Eventually, it doesn't impact the year volume. If you see our guidance for this year, we are on track, and we will be able to achieve that. Sure. Got it. And these annual shutdowns. Usually, we take one big shutdown, annual shutdown, and then there are probably a couple of small shutdowns of four to five days only just to keep the plant running at full capacity. Got it. And what would be the duration of the full shutdown, the big one that you take on an annual basis? See, it's about 30 days, 25-30 days. Okay. Got it. Sure. Thank you so much, sir. Yeah. Thank you. Thank you. We have our next question from the line of Siddharth Gadekar from Equirus Securities. Please go ahead. Hi, sir. So just one question on the external pellet purchases. How much have we purchased this year in nine months, and what will be the full year's purchases? You mean times? Because you mentioned pellets. Yeah, yeah. See, roughly, our current mine capacity gives us about 70%-75% of the requirement. So we purchase about 50,000 tons of iron ore from the market. So about 6 lakh tons annually we purchase from the market currently. Going ahead into FY 2026, from the mine start, this will go to zero, right? Sorry? Once our mines start, the expansion comes in, this will go to zero, right? 100%, yeah. So once the mining capacity reaches the full capacity, so our current requirement, which is mining from the market, plus the additional requirement, everything will become captive. Okay. Got it. Thank you. Yeah. Thank you. We have our next question from the line of Divya Agarwal from Ficom Family Office. Please go ahead. Hi, sir. Thanks for taking my question. So just wanted to know, what's the yield rate that you get on the beneficiation plant? Okay. So on the BMQ side, because it's low grade, we do about 50%. And on the plant side, so the yield is about 80%-85% on annual basis. You mean BMQ? You do BMQ as well? So, BMQ is about 50%, and the iron ore, which is about high grade, 50-51%. From that, we get about 80-85% on annual basis to maintain the pellet quality. Yeah. Thanks. Thanks a lot. Thanks. Thank you. We have our next question from the line of Chirag, an individual investor. Please go ahead. Hello? Hello. Am I audible? Yes, please. Sir, can you provide a brief overview of the entire production process at GPIL, starting from iron ore to pellet production, moving downstream to sponge iron, billet, and as well? How does the integrated operation function? So basically, it's mining, then pellets, pellets fed to the DRI for making sponge iron. Sponge iron now fed to the steel making, which is the induction furnace, along with a little bit of scrap. And then billets are being hot charged to the rolling mill for making wire rods and structures, which we recently commissioned. And wire rods are further rolled into HB wires. So basically, we sell wire rods, and we sell HB wire as a finished product. And pellets, because we have additional capacity. So that is the entire process. Backward integration, of course, the captive power. Yeah. Right. Right. Regarding the 0.5 million ton integrated steel plant, what specific products are produced within this capacity? If you consider the combined production of MS rounds, HB wires, sponge iron, the total exceeds 1 million tons. Currently, our steel capacity is about 0.5 million tons of crude steel, which is billets. So 0.5 million, about 0.2-0.25 is wire rods, and about 0.2-0.25 will be structures. The new mill, which is commissioned in RR Ispat, right? So going forward, once the RR Ispat mill gets fully operational to its full capacity, so billets, so 50% will be structures, 50% will be wire rods as finished products. Thank you so much, sir. Ladies and gentlemen, due to time constraints, that would be the last question for today. And I now hand the conference over to the management for closing comments. Over to you, sir. Thank you. We would like to express our heartfelt appreciation for joining us on this conference call. We are confident that we have adequately addressed all your inquiries. Should you have any further questions or need additional information, please feel free to reach out to our investor relations team at Go India Advisors. Once again, we sincerely thank you all for your active participation and unwavering support. Thank you. Thank you very much. Thank you. Thank you. On behalf of Emkay Global Financial Services Limited, that concludes this conference. Thank you for joining us, and you may now disconnect your line. Thank you.