Ladies and gentlemen, good day and welcome to Godawari Power & Ispat Limited Q2 FY2026 earnings conference call hosted by Go India Advisors LLP. As a reminder, all participants' 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 any assistance during the conference call, please signal an operator by pressing star then zero on your touchstone phone. Please note that this conference is being recorded. I now hand the conference over to Ms. Sana Kapoor from Go India Advisors. Thank you, and over to you, ma'am. Thank you, Shalimi. Good afternoon, everyone, and welcome to Godawari Power & Ispat Limited's earnings call to discuss Q2 and H1 FY2026 financial performance. We have on the call Mr. Abhishek Agrawal, Executive Director; Mr. Dinesh Gandhi, Executive Director; and Mr. Sanjay Bothra, Chief Financial Officer. We must remind you that the discussion on today's call may include certain forward-looking statements and must be therefore viewed in conjunction with the risks that the company faces. May I now request Mr. Dinesh Gandhi to take us through the company's business outlook and financial highlights, subsequent to which we will open the floor for Q&A. Thank you, and over to you, sir. Ladies and gentlemen, the line of Mr. Dinesh Gandhi has been disconnected. Please hold while we quickly get them reconnected. Ladies and gentlemen, thank you for being on hold. The management has been reconnected. Thank you, and over to you, sir. Hello? Yes, sir, please go ahead. Yeah. Hello. Thank you. Good afternoon, everyone. Thank you for joining us. This call today, our financial results, especially the earnings presentation, are available on our website and on the stock exchanges. I believe you have had a chance to review the same. At the outset, we are deeply moved and grieved by the unfortunate and unforeseen incident which took place on 26th of September, 2025, in one of our pellet plants, in which six of our colleagues lost their lives and six others were injured. Our heartfelt condolences to the family of deceased colleagues. May the departed soul rest in peace. The company has provided financial assistance to the families of the deceased. While no amount can ever compensate for the loss of life, our support goes far beyond the financial aid. We remain committed to ensuring long-term security of the families of the deceased employees through employment opportunities for eligible dependents, pension benefits for no employable member in the family, and uninterrupted education for children through reimbursement of school and education expenses. Safeguarding their future is our highest responsibility, and we stand firmly committed by the same. Now, coming on the GPIL performance, I'm pleased to state that Q2 H1 FY2026 has been a period of consistent performance, strong operational progress, revenue remained stable, supported by higher pellet and galvanized product volumes, while EBITDA and PAT margins stood healthy at 22% and 14% respectively, despite soft realization across the product range. On operational performance front, GPIL is well on track to meet its FY2026 production target, despite loss of production of pellets for about 40 days due to the incident that took place on 26th of September. While the plant was closed, we took the opportunity to prepone maintenance shutdown, which was in any case due in Q3 FY2026. In H1 FY2026, production volume of iron ore mining, pellet, value-added steel products grew by 18% and 16% respectively, despite loss of production of five days in September. Pellet sales rose 30%, while value-added steel products saw a decline. Realization softness across the product, except ferro alloys and galvanized fabricated products. In Q2 FY2026, production increased further by 29% for the mining, 31% for the pellet, and 5% for value-added product. Pellet sales surged by 71%, whereas value-added steel products saw a decline. The trend in realization remained similar, with only ferro alloys and galvanized products maintaining year-on-year stability. Coming on the consolidated financial performance, in H1, sales turnover remained largely stable, supported by higher production and sale of pellets, galvanized products. However, EBITDA and PAT were lower due to softer realization. Even so, EBITDA and PAT margins remained robust at 22% and 14% respectively. In Q2 FY2026, revenue, EBITDA, and PAT saw a year-on-year decline, driven by higher sales volume of pellets and roll products on quarter-on-quarter basis. However, these metrics were lower, owing to reduced realization and seasonal recess for iron ore pellet and finished steel. EBITDA and PAT margins continued to hold firm at 20% and 12% respectively. Overall, financial performance of the company remained healthy and stable. Let me now update you on other strategic growth plans of the company. I'm pleased to inform you that we have been able to move forward on getting much-awaited regulatory approvals for expanding capacity of Ari Dongri iron ore mines from 2.35 million tons to six million tons per annum, and we have successfully completed public hearing for environmental approval. The environmental approval is in final stage now and expected by the end of December 2025. The two million-ton pellet capacity expansion is progressing as planned. The pre-commissioning trials are underway and commissioning targeted by the end of November 2025, which is awaiting consent to operate from State Pollution Control Board. The entire work for the commissioning of project has been completed. The land acquisition for expansion of iron and steel capacity has been completed, with 452 acres of land secured for integrated steel plant and CRM complex. The 0.7 million tons cold rolling mill complex project is progressing well, with land acquisition completed and major equipment orders placed. The total cost of project for CRM project is INR 900 crore, of which INR 600 crore is financed to the date and balance remainder funded by internal approval. The company proposes to take up one million-ton integrated steel plant post iron ore mining capacity announcement. The proposal for the same will be put up to the board after the production on expanded mining capacity is started. Godawari New Energy Private Limited, a wholly owned subsidiary of GPIL, has planned to set up 10 gigawatt battery energy storage system project in Maharashtra, for which land acquisition of 120 acres has already been completed. The cost of project is INR 700 crore, which is supposed to be funded by a debt of INR 600 crore, 60%, and balance from internal accrual out of equity contribution from GPIL. GPIL has already infused equity contribution to the extent of INR 175 crore, which has been utilized for land acquisition and other project-related expenses. The board in its last board meeting has approved setting up an additional 250 megawatt solar power capacity, in addition to earlier announced capacity of 125 megawatt for captive use in CRM project and integrated steel plant. The project is expected to be commissioned by Q4 FY2027, coinciding with commissioning of CRM project. The surplus power pending use in Boriatibu and integrated steel plant, the company proposes to use power from 250 megawatt solar for existing iron and steel operations by temporarily suspending thermal power generation. Operations at Boriatibu mine resumed in May 2025 following approval of updated mining plan. Additionally, GPIL has received PGCIL approval for supply of steel billet for transmission-grade galvanized steel structures, recognition of high quality of GPIL billets, now comparable to those of India's leading steel producers. Notably, GPIL remains the only company in India to provide fully integrated end-to-end solution for galvanized steel structure from iron ore to finished product. Coming on the market outlook, global iron ore prices have largely moved within the $95-$110 band this year and currently at around $102-$103 a ton. Weather-related supply disruption supported the prices in the first half, while higher supply in the second half may curb further upside. Geopolitical tensions continue to influence global demand through China's recent stimulus measures, including direct cash transfer to boost consumption, which should offer some support for calendar 2025. Iron ore prices in China are expected to remain in the range of $90-$105. The World Steel Association's hour project, China's steel demand to decline by 2% in calendar 2025 and 1% in 2026, as the housing market stabilizes. On the domestic front, iron ore prices, NMDC 64 AC fines have remained range-bound between INR 4,500-5,500 per ton. Pellet prices have also been stable around the INR 8,500-10,000 band, currently at around INR 9,750 a ton and likely to follow a similar trend in H2. India's steel demand remains strong, with World Steel Association forecasting 9% growth both in FY 2025 and 2026, driven by sustained expansion across infrastructure construction, supported by initiatives such as National Infrastructure Pipeline, Pradhan Mantri Awash Yojana. By 2026, India's steel demand is expected to be nearly 75 million tons higher than as compared to 2020. Taken together, our operational consistency, discipline, project execution, forward-looking investment highlight GPIL's readiness for next phase of growth. Backed by over four decades of industry experience, strong leadership, and committed workforce, the company stands on the foundation of strength and resilience. Going forward, as we scale our mining and pellet capacities, strengthen downstream capabilities, and deepen our renewable energy integration, we continue to build on a strong competitive position. Our solid net cash position, strategic CapEx pipeline, and strong ESG focus further support our long-term value creation efforts. With efficiency gain and cost savings from solar projects, benefits of captive iron ore resources, GPIL is well positioned to capture emerging opportunities and deliver sustainable value to all stakeholders. I would now like the floor open for questions and answers. Thank you. Thank you. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on their touchstone phone. 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. The first question is from the line of Prakash Singh from ICICI Securities. Please go ahead. Good afternoon, sir. Thank you for the opportunity. Sir, first question regarding the pricing scenario. If you could give us some idea what the spot prices versus the one-view averages are. We have heard some price increase happening recently. Could you just confirm the same? Lastly, anything you heard on the safeguard duty, which has provisional has been lapsed? Hi, good afternoon. The prices, are you talking about the sales prices, right? Pellets, banjaris, and so on? Yes. Okay. So pellet H1 has been close to INR 9,500 average. And looking at the current demand and supply, we feel H2 also will be on the same similar level because pellet demand in the domestic market is still quite strong. Of course, there will be plus-minus 10% on account of demand, but more or less it's stable. So DRI is about INR 22,000-23,000 on the lower side. Billets were about INR 34,000 on the lowest. Right now, it's about INR 35,000 and finished around INR 38,000-39,000. So prices in the last, I would say, six weeks or so have been close to rock bottom for this financial year at least. Demand looks to be picking up as monsoon has got over. Now everything is festivals are over. Hopefully next two weeks we can see a better realization compared to H1. Okay. Was there any INR 1,500 kind of the price hike in the last one week in the long product? As I said, right, storage demand is picking up. What happens now is people try to increase the prices in a haste. If the demand is there, it sustains. If it does not sustain, it rollbacks. That has been the trend from the last couple of weeks where the prices start going up and then it comes down a little bit again. I'm very sure things should improve from here on. Okay. Any words on the safeguard duty which you have heard because the provisional has been lapsed and we are not sure by when the final notification would come? No, yeah. No, not because since I'm not mailing to that product of HRC, right? So I don't follow it very closely, but yeah, I think at the moment everyone's hoping it should come soon to support the industry. Noted. My second question is your strategy towards using solar power to use in the future project as well. That 250 MW solar power which you intend to use in the CRM, how should we look at what kind of cost saving it will give and does it really make sense because that money could go for the new product or increase your overall volume, sir? I just wanted to understand what kind of the internal IRR on that project we are expecting at this point of time, especially when there is no premium on the green steel. I'll tell you. I'll tell you. See, if you don't install any power and we import parts from the grid, right, my grid tariff will be close to about INR 8, INR 7.75-INR 8 annually on per unit basis. When I calculate that, because the CRM, it's a volume business, there's a lot of competition, but it's high value addition, but the margins are thin. You operate between 8%-10%. Every penny matters, right? If I import INR eight grid power and give it to my CRM complex, my operating cost will be on the higher side. Rather than I have a land available for me which I can use and I've been doing solar power since so many years, I think this is the right way to invest in the solar power so that my operating cost goes down from day one. Not today. Just to tell you that that solar power plant will not only go for my CRM complex in the long run, it will also be feeding to my second mine Boriatibu mine where we will be installing power there as well because the mine share rate is close to INR 12. So it is better to put solar plant there as well. This new 250 MW will feed to my CRM as well as my mine in the longer run. Noted, sir. Actually, I was coming from the fact that a thermal power plant of much lower capacity and cost would also suffice your. No, no, no. No, so I'll tell you in that way. Firstly, today thermal power plant is not cheap. It's INR 70,000,000 minimum per megawatt, right? Plus, as a company we've decided, we will not be going for any fossil fuel thermal plants. We have no intention of going back into that. We are very much happy in moving forward because sooner or later, I'm very sure with new government norms, new carbon tax mechanism which India has proposed, things will get beneficial for us in the long run. We will start getting the results of whatever investment we're doing right now. I'm very sure about it. We have no intention of going back into fossil fuel. Noted. Sir, until your own HRC capacity comes in, you would be buying HRC from the market. What kind of margins do you think you would be making in CRM? No, no. Just to correct, we are not entering into HRC market. Our new steel plant, when it goes ahead, it will not be making HRC. So we will be a long-term buyer of hot rolled coil from the market to feed to my CRM complex. What kind of conversion margin do you see at current spot basis? I know that the future can be predictive. See, to be honest. At current level, what kind of the conversion margin do you see in the CRM complex? That's what I'm saying. As we said, where the industry tends, we're not entering between 10%. Now, 10% is a very good number. I would say 7% is an average number. So even we have considered the same margin when we did our pandemic planning. We will be a buyer of HRC from the market on the longer basis, and we will be feeding and converting to value-added products. That is the whole idea. Noted, sir. Sir, just one last question. Once the Ari Dongri mining capacity goes to six million tons, do we would have the need to run Boriatibu simultaneously, or we will save that Boriatibu for the future? Just wanted to understand, ask or say. Yeah. See, Boriatibu is a low-grade mine specifically where the grade is average grade is about 48, 47, 50, right? The idea is we want to start investing in Boriatibu because increasing the mining capacity will take a lot of time because currently that mine is not tentative with a lot of infrastructure. That needs to be developed. It will take its own sweet time. The idea is in three, four years, we start running Boriatibu to a decent level. As in where we feel the bigger mines are not able to feed or there is a shortage, we can always amp up the capacity. Today also, if I start working on Boriatibu, the next expansion can only happen minimum three or four years from now on. I'm looking at an April 29 minimum from here to increase some of the capacity in Boriatibu. It is a long-term planning. Very well noted, sir. I have more questions, but I'll come back to the field. Thank you for answering. Let me add one more point in this solar thing. This 250 megawatt solar, if you compare with the rate of INR 7 and net cost to the steel plant at about INR 5.50, the internal rate of return is about 24%. It is a healthy investment. Number two, if you want to do solar under group captive, then the point is that the land on which this project is proposed cannot be done under group captive because it has been allotted to Godawari Power & Ispat Limited, and it cannot be subleased to any other company. These are the two other factors for considering this 250 megawatt project on the balance sheet of GPIL. Thank you, Srinivasi. Thank you. Thank you. The next question is from the line of Siddharth from Equirus Capital. Please go ahead. Hi, sir. Good morning. My first question is on the mining capacity. Now, when Ari Dongri is going to six million tons, when do we expect the entire crushing verification to come online, and we should be at that six million ton run rate on an annual basis? See, hopefully we should get the final clearance from the State Pollution Board by end of this quarter. From there on, January, probably we need a couple of months to get things back in order because we have been trying to manage till now because the heat has been delayed for two years. We see a ramping of capacity happening from April, April 2026. Next year, six million looks difficult to be very honest with you. Our idea is to reach 4.5-5 million tons next year and then full throttle six million tons from January 2027. That is our idea to go ahead. Broadly, we are targeting the. Yeah, sorry. Go ahead. Boriatibu mines will mine about 500,000 tons annually, out of which I'll get about 300,000 tons of concentrate. That will give me a decent cushion to operate my plant from my own captive mine, all the pellet plants. Okay. So So broadly, we are suggesting that the beneficiation and crushing facility also should come online by calendar year 2026 end. And we should be in place to ramp up the. No, no, no. See, we're already running a 0.6 million benefication plant. The further expansion is just an extension of it. We are completely ready. Once we get the permission, we'll take about four to six months to get the line up and running. We're expecting by June or July, the full benefication will be in place, right? Since it's going to be monsoon, we can expect from Q3 onwards, the entire benefication and mining will be at full capacity. At peak, given where our current capacities are on the expanded pellet capacities, what would be a peak iron ore requirement in 2027 then? You mean after 2027? From calendar year 2027 onwards. See, we will be producing at the current pellet level, we should be producing I think about 4.2 million tons. Assuming 15%-20% yield loss on beneficiation, we need about 5.7-5.8 million tons. That is the whole idea. We mine about five million tons in the first phase, take it to six million tons in the second phase so that we are always 100% captive. We will broadly not use any iron ore for manufacturing sponge. We will still use pellets to manufacture sponge, or we might answer something there also? No, no, we cannot because our mine is magnetite, and magnetite is not suitable to directly feed into sponge iron. The only way you can consume magnetite is through iron ore pellet route. So our DRI capacity will always run on 100% pellet. Broadly, we should look at it that way that at peak also we will be mining somewhere between 5.5-5.7 million tons? I mean, see, six million tons, and six million is what is the idea. 5.5, 5.7, 5, depending on how the monsoons will play. The idea is whatever requirement we have for a captive pellet plant, it has to come from our mines. We'll clear it forward. We have no intention of selling any surplus in the market. Secondly, in terms of the CRM complex, any timeline for both the CRM complex and the BESS stack? See, as we have informed earlier to everyone, we're looking at the commercial production of April 27, which is FY 2028, for both, for BESS as well as for the CRM. In two years, we should reach at full utilization of that? Sorry, come again? The utilization, we should reach near full utilization in two years of operation? See, because both things, for us, it's a first-hand experience. We are assuming a 50%-60% PLF in the first year. From the second year onwards, we will be at 80% plus in both the plants for sure. That is the whole idea. Okay. Given that, now we will start work on even Boriatibu mine. Broadly, two, three years down the line, again, we will look at expanding our pellet capacities or how should one think? No, no. The idea is the Boriatibu will raise the capacity so that it can support our additional capacity requirement in this new steel complex. We might require one million ton because we might put up a center plant there. The idea is to beneficate Boriatibu inside the mine, reduce our wastages, and then straight away spend it for usage in my new steel complex. That is the idea with my new steel plant. We will time the Boriatibu capex also with the steel plant only. That is how one should think about it? See, the capex is not very, very, very big. The idea is because there are a lot of approvals required, a new EC has to be obtained. So today, anywhere between 18-24%. And then 12 months, we need to get the plant up and running. That's why we started working on the Boriatibu approvals, preparing a new EC, another document. Capex will only start happening probably two years down the line, nothing before that. Last question on my side. On the steel plant, any timeline for the CapEx or we are still some quarters away? As we had said earlier, for us to have comfort, for everyone else to have comfort, we are very clear. Once we receive the final approval of mining EC, then only we'll take it to the board for approval. Parallelly, we are very close to fine-tuning the CapEx, last discussion with all the key suppliers. For that as well, we need about a couple of months. We are hoping probably in next board meeting, we should be able to take up the steel plant for approval. Everything goes well. Okay. Thank you for that from my side. Thank you. Thank you. A reminder to all the participants that you may press star and one to ask a question. The next question is from the line of Manav from Yes Securities Limited. Please go ahead. Yeah. Hi. Good afternoon, and thank you so much for the opportunity. First question is on the iron ore expansion at Ari Dongri. Since we have already completed with the public hearing and are expecting approvals by December, what sort of volume can we expect? I mean, is there going to be any lag in the production once the ECs are in place? No. There won't be any lag in the production because from quite before only, we were always titrating the additional volumes to come up in FY 2027, which is April 2026, Q1 quarter. There has been a couple of months' delay to obtain. We thought we could get the EC by Diwali. That will not impact on any kind of production lag in this year. There might be a little bit of overlapping because the monsoon is going to arrive by June, and we will need some time to start having the capacities. Got it. Got it. On the pellet front, by when do we see the commercial production to start for the new pellet plant, the two million ton expansion? I think in a couple of weeks. I think by end of this month, we should be able to announce it at stock exchange. We are just waiting for the final approval to go ahead. We have started doing the cold trial, which is very much permissible. I think in a couple of weeks, the new pellet plant should be up and about. From Q4 onwards, we are expecting close to 80%-85% of the capacity for the new pellet plant. Okay. So the ramp-up time wouldn't be that long? No, no. Probably, yeah, a month or so, probably four to six weeks. Got it. That is helpful. Additionally, with the incident which happened at the pellet plants, what impact on volumes can we expect? Could you quantify it, especially in terms of the maintenance shutdown? We did lose about 150,000 tons of volume. Some of it was end of Q2 and entire October. It will reflect. The good thing is, out of 35-40 days shutdown, 20-25 days were already planned in end of Q3, early Q4 as an annual shutdown. That will maintain the job this time only. Plus, with my new pellet plant coming in and hoping to ramp up by Q4, the volume we had declared initially about three million tons, we are confident we can achieve that. Okay. So on an average, we can expect like 820 tons, 20 kilotons per quarter. Is that how the run rate is to be looked at for the next couple of quarters? Yeah. I think January, Q4, we should be doing about three, about 0.9 million tons in sales. Okay. So any margin time? Yeah. So whatever production happens, we are very confident we can be able to cover it from our new plant. Okay. Okay. Got it. I mean, since the mining is going to be a little delayed and the pellet cart would already be up and running, we can expect some merchant purchases of iron ore as well during Q3 and Q4? Yes. Yes. Of course. We have been a buyer in the market for about 50,000 tons every month. With the new pellet capacity, there will be additional mining capacity ramp-ups. The good thing is, firstly, in today's market also, because there are other merchants, pellet suppliers in the market who are buying 100% iron ore from the market and feeding to the sponge iron guys, there is still money to make. That will also help us in the bottom line, with additional better coming from additional volumes of pellet. Got it. You had mentioned in your opening remarks that the H2 prices for pellets are expected to remain in the INR 9,700 per ton. How are the premiums on iron ore pellets looking currently? Have we seen some fall over there as well, or is it in the broadly range of INR 1,000-15? There are no premiums as such. Specifically, this Raipur market, there has been a lot of addition of DRI capacities, and the addition is still going on. Every month, about 20,000-25,000 additional tons requirement is coming up. At the moment, Raipur is not able to feed the DRI guy. There is a shortage of pellets in Raipur. Going forward, once a new plant comes to production, that demand-supply gap will be quite balanced, and we can see the prices to be at a similar level. We do not see many going up and down too much. Okay. Got it. Just one last question. Could you provide me what was the landed cost of imported coal for the quarter? It was about. Q2, it was about INR 11,000 landed to my plant, RB1 coal, 6,000 CV coal. Yeah. Yeah. Yeah. Okay. How is it shaping up in Q3? I mean, any impact? Initially, the market was on the lower side. The index had gone down below INR 80. There has been a little bit of current, but not much. We can see Q3 should be between INR 10,500-INR 11,000 because the dollar has again gone up from 86 to 89 level. That also needs to be considered. Plus or minus INR 500 max. It is quite stable only, I would say, the imported coal as well. Sure. Sure. Thank you so much, sir. All the very best. Thank you. Thank you. A reminder to all the participants that you may press star and one to ask a question. The next question is from the line of Sahil Sangvi from Monarch Networth Capital. Please go ahead. Yeah. Good afternoon, and thank you for the opportunity. My question is more on the BESS side. I think we've heard announcements from Ola and Adani to enter this particular part of the project. I mean, they will be also doing something similar on this line. How similar is what we are doing and they are doing, and would that be a lot of competition to handle for us? Firstly, whether it's Adani, Ola, DSW, there will be a stiff competition in this, and we are very well prepared for that because we don't want to be a capacity design such that we want to be probably one of the top five in India in terms of volumes, right? We are very clear about the competition. Now, in terms of Adani, the announcement they had made, they also come back with a new announcement. The news is not totally 100% correct. Basically, 30 gigawatts, they are doing it for their own Gujarat project where they're building up one of the biggest solar parks of 25 megawatts. So 30-35 gigawatts will go for their captive convention. That's a calculation that came from Adani in the next Economic Times. What Ola is doing, Ola is now trying to install a BESS for their battery charging solutions where the consumers can reduce their power cost, their electricity bill, in an admitting concept. The idea is same. I mean, the logic is same that the applications are different for everybody individually. In our case, what we want to be doing is we are not a developer. We won't be bidding in tenders or SECIs. We are going to be supplying containers and directly competing with other guys in India as well as imports from China. Thanking with government policies, the way it has been supported solar industry till now, those policies will also start coming in place as and when the volumes in India start going up of supply. There's a big mismatch of demand and supply. Today, India can supply always 10%, 90% is import. When the demand supply starts coming close, I'm sure government will come up with policies and start supporting the machine industry. That is the whole idea on the BESS side. Got it. Got it. Just for your information, Reliance is coming up with 40 gigawatts, but 30 gigawatts again is for their own towers, telecom towers, right? They will be coming with only 10 gigawatt capacity in the market and competing with us. Eventually, we will be also on the similar level. Our capacity is also very big. It is 10 gigawatts first only. Got it. That's how we vision it at the moment, this particular business. Yeah. Got it. Got it. And secondly, just to understand the kind of iron ore that will be mining in FY 2027, you said about 5-5.5 million tons. Is that correct? For FY 2027? Yes. Yes. Yes. So yeah, for FY 2027, since there has been a slight delay and with the monsoon onset, and so this year, the monsoon was five months, right? So keeping all that in mind, we should be able to do somewhere about 4.7-5 million tons in FY 2027. The new. The expanded beneficiation plant of six million tons from 0.6 to six million will be up and about by, say, June, July, which is end of Q1 or early Q2. Right. Right. And the balance requirements this year and next year, will we be fully dependent on the market, or would there be some supplies from Boriatibu also? I mean, how would that? Boriatibu supplies are continuing. We intend to do a function mining of about 3.5 million from Boriatibu, where we'll get about 0.3 million tons. There'll be additional support of our own magnetic raw material. Rest, we will have to go into the market to keep running a plant. I'm hoping this should continue max till probably, say, March. From April onwards, we will see additional volumes coming out of the mines. Okay. Okay. And roughly, the production target for FY 2027 would be four million tons for pellet, or would that be lower? No. So pellet for next year, four million will be bare minimum. It might be on the higher side. We'll probably be able to analyze during planning of the next year. But four million will be bare minimum for sure because we expect 80% capacity utilization from Q4 this year only for the new pellet plant from January onwards. If that happens, 80% from next year will be bare minimum four million tons without a doubt. Got it. Got it. That is good to hear. Thank you. Thank you Thank you and all the best. Thank you. Thank you. The next question is from the line of Vaneet Thakur from Plus 91 Asset Management. Please go ahead. Hi, sir. Good afternoon. Thank you for the opportunity. I had a couple of questions regarding our, so there is a sponge iron decline in production. Are we utilizing it to make pellets and other stuff more? Have we increased the capacity to utilize sponge iron more? See, so currently, our sponge iron is 0.6 million ton, and in our steel capacity, we do about a production of 0.5. Now we're installing a new furnace of 30 tons, which will require additional 50,000 sponge. When that is in operation, I think from next year onwards, our sponge sale will be totally zero. Yes, sir. Sorry. Sorry. Please go ahead. Please go ahead. There is a spike in our galvanized fabricated products production and sales. Could you shed some light on why there is such a spike in that? We have done really well in that segment. Is there any market tailwind that we are expecting, or are we exploring new avenues where we increase the sales for that product? We are. So on an additional capacity, since we got all the approvals from PGCIL now, we are ramping up the capacity of our rolling mill. We have also started sticking strips, which are basically used for the pipe segment because since our quality of billet is like that. We are hopeful from Q4 onward, we can see a substantial jump in the volume of RR for strips as well as for the galvanized strips. Sir, there is a decline in the sales of steel billets as well by 40% H1 over H1. It was because in June, we had taken a planned shutdown of one of our bigger turbines. There were modifications required to meet the new norms. Basically, State Pollution Board has recommended to all industries to revise their pollution norms, which are allowed. To maintain that, to complete the timeline, we had to take a two-month shutdown of one of our power plants. To do less power, the production of the billet side is less. That is the reason. Sir, could you shed some light that iron ore capacity in India right now would be a shortfall for steelmakers in India itself in recent years? Do you think that there will be a good price rise in iron ore sales and fines? See, I think today, because of the mismatch, especially in the Eastern Belt, which covers Bengal, Odisha, Jharkhand, all, there is already a huge shortage of iron ore. That is the reason in spite of such weak steel prices, the pellet prices are still on the higher side. If you speak to any DRI guys, they would say pellet prices should be at least INR 1,000 less from here on. Because of shortage of iron in India and the production is going up every year by 8%-9%, that's why the raw metal prices in India are on the higher side and will remain elevated unless the supply starts improving from the iron ore side. Sir, we heard a lot of government mines are coming up on sales of blocks. Hello. Mines keep coming, but any virgin mines, any new mines with auction, it takes minimum three to four years to start operations, and at least probably a couple of years to ramp up the capacity. Whatever is happening, I'm sure the mines which got auctioned in, say, 2021, 2022, they might be coming into production this year. That's what I'm saying. The demand is much more than the supply which is being held up in India. The government is concerned about it, and they are hopefully working on it. Do you think the prices of iron ore and pellets and everything would be, this would be the bottom right we are looking at right now, and this would go upwards from here onwards? See, to be honest, on a very long-term basis, I think INR 9,000 for us as a relation X plant on a longer-term basis is very, very practical. I do not want to be very optimistic or very pessimist. I think INR 9,000 if I get a longer term, I think it is a good pricing for the pellet people, for sure. Okay, sir. Thank you so much. Thank you. Thank you. The next question is from the line of Family Office. Please go ahead. Regarding BESS, you'll be supplying to utility grade, if I understand. Have you partnered, already started partnership discussions with the developers who might be using this or bidding for this? No. To be honest, not yet. To be honest, not yet because we are still about 12 months away, 12 to 3 months away when we start supplying. As we come close to the date of commencing the operations, we will think of having discussions with three or four big developers who are going very aggressive in terms of the volumes. We have that in mind. At the moment, because it is too far away, our supplies, it does not make sense to talk to somebody right now because competition is big. Imports are still happening. I do not think so even the other player would be quite keen on taking discussion very seriously at the moment. Once we have furthered the commissioning operations, then probably we start discussing. We have that in mind. Okay. Your cells will be imported from China, but BESS, typically, the systems are for longer projects, whatever I understand, 5-10 years. How will the warranty work in that case? Because you'll be putting in a container or assembling whatever you will do with that. Exactly. Exactly. We will be importing cells. Whatever warranty we're getting on cells, we will pass on to our buyers back to back. That is the whole idea. Apart from cells, everything will be done in India if you study the government policies. PCS is already compensated from India. EMS is already compensated from India. Government is very proactive in supporting the domestic manufacturing. Only the cells will be imported. Everything will be from India only going forward. You basically say any issues come in wherever you're buying from China, they will be helping out with that warranty. Typically, what will be the warranty period if at all you're importing from China? See, for cells, if you know the technology, for it's basically 8,000 cycles for two-hour charge discharge. Basically, roughly, it's about, say, eight years, 10 years down the line, depending on the cell category. For cells, because we do realize it's a very critical part of our operations, we are only discussing with top A category clients in China and trying to enter a long-term supply for them. That's how we're going to be procuring cells on a long-term basis with top, top A category suppliers only, like CATL, EV, Lithium. These three we have identified, and we are at a very advanced stage of negotiation with them. Okay, sir. Thanks and all the best. Thank you. Thank you. A reminder to all the participants that you may press star and one to ask a question. The next question is from the line of Siddharth from Equirus Capital. Please go ahead. Hi, sir. One more question on the fundraiser, the preference issue that we had done recently. Any rationale behind that? Why did we do a preference issue? Dinesh ji? Yeah. Siddharth, there is no major rationale, but if I have done a preferential issue, it shows that 50% or more than 50% of this is taken by the promoters. Who else knows the business better than promoters? Promoters wanted additional equity in the company, and therefore, we have gone ahead with the preferential issue. This money, in any case, will be partially utilized for our upcoming project. This helps funding the project also without raising additional debt. Any of this thing that we are getting ready for the steel plant CapEx, and that is why we have done this CapEx and other special issues? No, steel plant CapEx will be much larger. This INR 100 crore of preferential issue does not fund my entire steel plant project. Definitely, this will help meeting requirements for BESS and CRM projects. Okay. So incrementally, when we go ahead with the steel plant, will we require incremental fundraising, or we should be able to do it from the internal cash approvals now? It all depends. We will need to raise some debt, definitely, for the steel plant. We will definitely raise the debt. We will see what is the equity availability with us and what is additional required. Okay. So lastly, coming to our pellet volumes for 2H, given that NMDC has also taken a price cut, we still believe that we should be able to maintain this range of pellet realizations going ahead? 100%. Because there is shortage of, see, you need to understand, although NMDC has a price cut, but the supply from NMDC is limited to a certain extent. They follow a certain system, their process. You have to apply for linkages. And there is an additional requirement getting generated every month and month into this area because of additional capacity of DRI. Right now, there is a shortage of pellets in the market. Meeting the volumes and the pricing, I do not see a challenge at all, at least for this financial year, remaining part of the financial year. Secondly, majorly, in the first half, we have sold mainly in the Raipur area, or we have looked at other markets also? No. We sell close to about, let's say, a periphery of about maximum is about 100 km in and about Raipur. That's it. Going ahead on the expanded capacity, how do we see that changing? No, that won't change because right now, there is pellet coming from outside Chhattisgarh. For example, Odisha is there. That will stop. Whatever is a little bit of coming from outside, that will stop first. See, again, it's a commodity at the end of the day. There is some price plus-minus, so we shouldn't be surprised. At the moment of it, I can see, I can visualize there is a demand-supply gap. With any pellet capacity, that gap will close down. Yeah. Would you put in any number in terms of how much DRI capacity has been added in India over the last 12 to one to three years? No. I don't have the data. Let me get back to you on that. Let me check and get back to you on that. I don't have the data right now. We are very confident that of the incremental offtake also, we should not see any challenges given there was a huge volume here. No, no, no. See, I know DRI capacity in Chhattisgarh at least because being a small town, we keep talking to each other at the promoter level. I know which guy is installing how much capacity, how much is still in pipeline. That idea we have. Just to give you a data, exact number, I need to go back and come back to you on that. I need to check. Okay. I've got it. Lastly, just on the secondary steel, given that we have seen a significant weakness in billet and sponge iron pricing, do you expect this trend to continue in the third quarter as well and some pick in the fourth quarter? Hopefully not. See, I really don't know when demand comes and demand goes. I still wonder currently what happens. I hope the demand comes back because the period has been extended. Now, it's almost been five, six months. I hope as an industry, the demand comes back and the prices do go up. Otherwise, it will be a tough time for, as an industry, it will be a tough time to survive this phase. Yeah. Okay. Got it. Thank you so much. Thank you. Thank you. A reminder to all the participants that you may press star and one to ask a question. The next question is from the line of Manav from Yes Securities. Please go ahead. Yeah. Hi. Thanks once again for the opportunity. Just building on Siddharth ji's question regarding our two million-ton pellets also coming into the market, are we looking at exports as a strategy sometime down the line just in case there's an overflow of pellets? Yeah, yeah. 100%, of course. See, I always have my mind on exports. I do tag the market. You see, even Lloyd's is exporting a little bit of pellets because of his current supplies. Exports are always open, and the export market is, I would say, moderately strong at the moment. If you see, I know it is well above 100. There is the amount of pellets in the market. We are very much open for exports as well if there is a challenge selling in the domestic market. Got it. I think a couple of quarters back, we did have one shipment for the exports. Have we done anything during the first half? No, no. See, right at the moment, export only happens when there is actually a necessity. There is no demand in the local market to just sell that additional volume for the time being. With new capacity added up, there might be a situation where we have to sell every one cargo every month. No one knows how it plays. We are very much open. Got it. Got it. The second question is for the CRM and the battery energy storage. I think for the CRM, we have already done the order placements in the second quarter. What's the status on the battery energy storage systems right now? Dinesh ji mentioned during the start of the call. We have acquired the land in Aurangabad industrial area. It is called Auric. We signed an industrial policy MOU with the Maharashtra government. We should be starting the demarcation work and other infrastructure work during the next month. From January onwards, we should be able to start work at the site in full sorting. Machine orders have been started being placed in respective buyers, being in India, being China. That should complete in the next six months. The line should be up and about, say, anything between January 2027 to March 2027. That is the pre-trial commissioning and all that. Got it. FY 2027 end is where we expect the. Yeah. See, for both, for BESS as well as CRM, we've given the commissioning date to be April 27, which is FY 2028. We should be able to meet that. Got it. Got it. Sure. Thank you so much once again. Thank you. Thank you. Ladies and gentlemen, that was the last question of the day. We have reached the end of the question and answer session. I now hand the conference over to the management for the closing comments. Over to you. We would like to express our deep sense of appreciation for joining us on this call. We are confident that we have been adequately able to answer all your queries. Should you have any other 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 for all your active participation and support. Thank you very much. With this, we conclude this call. Thank you. On behalf of Go India Advisors, that concludes this conference. Thank you for joining us, and you may now disconnect your line.