Ladies and gentlemen, good day, and welcome to the Q4 and FY 2026 Earnings Conference Call of Happy Forgings Limited. This call will begin shortly. Please stay connected. Ladies and gentlemen, good day, and welcome to the Q4 and FY 2026 Earnings Conference Call of Happy Forgings Limited. The conference call will begin shortly. Please stay connected. Ladies and gentlemen, good day, and welcome to the Q4 and FY 2026 Earnings Conference Call of Happy Forgings Limited. As a reminder, all participant lines will be in the listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during this conference call, please signal an operator by pressing star then zero on your touch-tone phone. Please note that this conference is being recorded. This conference call may contain forward-looking statements about the company, which are based on the beliefs, opinions, and expectations of the company as on the date of this call. These statements are not the guarantees of future performance and involve risks and uncertainties that are difficult to predict. I now hand the conference over to Mr. Ashish Garg, Managing Director, Happy Forgings Limited. Thank you, and over to you, sir. Good morning and a very warm welcome to all of you to Happy Forgings Limited Quarter Four FY 2026 Earnings Call. With me, I have Mr. Pankaj Kumar Goyal, CFO of the company, Strategic Growth Advisors, our investor relation company. I trust everyone has had the chance to review our financial statements and investor presentations for quarter four and FY 2026, which we have filed with exchanges. Let me start by outlining the key highlights for FY 2026. FY 2026 was another milestone year in our journey, reflecting the strength of our business model, disciplined execution, and strategic focus on value-added growth. Over the last few years, we have steadily transformed the company through capacity expansion, higher machining mix, operational efficiency, and a sharper focus on profitable growth. FY 2026 is a strong reflection of that journey. During this year, we delivered our highest-ever annual profitability with revenues of INR 1,546 crore, EBITDA margins at 30.4%, expanding by approximately 160 basis points, and PAT margins at 19.5%, improving by approximately 90 basis points year-on-year on an adjusted basis. Quarter four FY 2026 was equally encouraging, with sales growth of around 20% year-on-year and EBITDA and PAT growth of approximately 30% and 24% respectively. This resulted in our best-ever quarterly performance across key parameters, supported by strong execution, better product mix, and operational leverage. Gross margins, EBITDA margins, and PAT margins for the quarter stood at 59.4%, 31.5%, and 19.7% respectively. Our finished goods volume grew by 11% during the year, while realizations remained broadly stable at INR 245 per kg despite softening raw material prices. This reflects the strength of our customer relationship, product portfolio, and increasing share of value-added products. In recent months, we have seen some increases in raw material prices and in other manufacturing costs due to ongoing U.S.-Iran. As per existing arrangements, we expect the raw material increases to be passed on to the OEMs. We are also in active discussions with the customers regarding inflation in our other manufacturing costs and remain hopeful of cost recovery. Commercial vehicle continued to remain our largest segment, contributing 37% of FY 2026 revenue. The domestic segment witnessed healthy momentum during the year, supported by improving affordability following GST rationalization, sustained infrastructure spending, healthy freight activity, and improved fleet utilization. Industry data indicates strong mid-teens growth in domestic MHCV truck production and sales volume in FY 2026, and other domestic segment growth was in line with that. Domestic industry outlook for FY 2027 remains stable with expectations of continued replacement demand and infrastructure-led growth. Global markets, particularly North America and Europe, reported 9-10% decline in unit sales and also led to single-digit decline for us as well in our export-dependent CV segment sales. Farm equipment contributed 32% of our total operating revenue in FY 2026, growing around mid-teen range during the year for us. The domestic tractors industry demonstrated strong growth during the year, supported by favorable monsoons, healthy reservoir levels, improved rural cash flow, and strong agricultural output. Industry volumes also benefited from increasing mechanization trends and improved affordability. Export markets declined further during the period. Export markets in Europe and U.S. are expected to remain broadly stable in calendar year 2026, and the long-term structural outlook for the industry remains positive given India's relatively low farm mechanization levels and rising adoption of higher horsepower tractors. Industrials contributed 14% of our operating revenue and delivered stable performance during the year in line with our overall growth. Demand remains healthy across power generation, renewable energy, wind energy, railways, oil and gas, and digital infrastructure. The broader capital goods and industrial ecosystem continue to remain strong, supported by increasing government and private sector CapEx. Investments in renewable energy, transmission and grid infrastructure, rail modernization, and India's rapidly expanding data center ecosystem are expected to continue driving demand. Off-highway contributed 11% to our operating revenue. Amid broader categories' weakness, the domestic off-highway segment saw softness on a year-on-year basis. Slower project awards, particularly in roads and highway and other infrastructure segments, along with land acquisition approval related delays, moderated the pace of project execution. This impacted equipment demand during the period and led to a 7% decline in domestic construction equipment sales. Industry conditions in Europe and U.S. remained challenging during this period, with a marginal decline from prior year. Passenger vehicles contributed 6% to our total revenue in FY 2026. We have strong visibility on incremental business in this segment and expect the contribution to scale up meaningfully over the next few years in this segment. While the domestic business is witnessing steady growth, the export market segments across CV, farm, and off-highway is weathering challenges and may stabilize during the year and have some moderate signs of recovery. During the quarter four FY 2026, we did see a higher share of export business indicating early signs of demand pickup. One of the important strategic developments in our business has been the increasing diversification of our order pipeline. We are seeing growing opportunities in industrial passenger vehicle, EV-linked programs, and export-oriented businesses. This will gradually reduce dependency on traditional cyclical segments and create a more balanced and resilient portfolio over the medium term. Our continued focus on the value addition is also reflected in the product mix. Machining contribution increased to 89% in FY 2026 compared to 87% in FY 2025 and 73% in FY 2021. On the capacity side, we expanded machining capacity to 68,000 metric tons during the year, including an addition of 9,800 metric tons in quarter three FY 2026. We also commissioned a new 10,000-ton forging line during quarter four of FY 2026, while the 4,000-ton press is expected to be commissioned in the first half of FY 2027. These investments are aligned with the strong business opportunities we see ahead. When we look back at our journey from FY 2021 to 2026, the transformation has been significant. Over this period, finished goods volume grew by 1.8x, revenue grew by 2.6x, EBITDA increased by 3x, and PAT grew by 3.5x. Alongside growth, we improved margins, strengthened the balance sheet, reduced debt, improved working capital efficiency, and enhanced return ratios. Importantly, this growth has been funded through healthy internal cash generation, with cash generated being almost equal to cumulative CapEx over the period. We have a double-A-rated stable credit rating, which is amongst the strongest ratings in the industry for a company of our scale that is not backed by large conglomerate, which reflects the strength of our balance sheet, governance standards, and financial discipline. Our strong balance sheet and cash generation capacities provide us significant headroom to fund our growth without relying excessively on external capital. Looking ahead, our outlook for FY 2027 remains optimistic. We expect late teen volume growth for the business while maintaining EBITDA margins broadly in line with FY 2026 levels. While global uncertainties and input cost inflation continue to remain near-term challenges, we believe our strong customer relationships, diversified portfolio, and operational strengths position us well to navigate the environment effectively. Further, as part of our long-term optimization and ESG strategy, we have signed a long-term lease of 80 acres of land to develop a captive solar power plant. We further have got approval that enables us to enhance our capacity of the proposed plant by additional 10 AC MW to 35 AC MW, with a total capacity outlay of up to INR 170 crore. This initiative is expected to reduce our annual power cost significantly with partial benefits starting from FY 2028 and full benefits accruing thereafter. Overall, we believe we are well positioned for the future, supported by the high capacities, improving product mix, strong customer relationship, healthy balance sheet, and a clear strategic roadmap for growth. With that, I would like to invite our CFO, Mr. Pankaj Kumar Goyal, to take you through the detailed financial performance for the quarter. Thank you. Thank you, Ashish. Good morning, everyone. I hope I'm audible to everyone. Let me now take you through the key financials and operational highlights for the fourth quarter and the full year ended FY 2026. We delivered a strong operational and financial performance during the year, reflecting the resilience of our business model and disciplined execution. For Q4 FY 2026, revenue from operations stood at INR 422 crore, while the full year FY 2026 revenue came in at INR 1,546 crore. This translated into a strong year-on-year growth of 20.4% for the quarter and 9.8% for the year. On the operational front, we recorded robust volume growth of 20.6% in Q4 FY 2026 and 10.9% for FY 2026 on a year-on-year basis. Realization remained stable both for the quarter and the full year at around INR 245 per kg. Gross profit for the quarter stood at INR 252 crore, while for FY 2026 it is INR 915 crore, registering a year-on-year growth of 21.9% and 11.9% respectively. Consequently, gross margin increased to 59.4% for the Q4 FY 2026 and 59.1% for the full year by 70 basis points and 114 basis points respectively. EBITDA for Q4 FY 2026 came in at INR 133 crore, reflecting a strong growth of 30.4% YoY. For FY 2026, EBITDA stood at INR 471 crore, up by 15.7% YoY basis. EBITDA margins improved at 231.5% for the quarter and 30.4% for the full year. That is by 240 basis points and 157 basis points for the quarter and full year respectively, supported by operating leverage and continued focus on operational efficiencies. Other income for Q4 FY 2026 came in at INR 6 crore versus INR 10 crore in Q4 of previous year. Other income for the full year was INR 31 crore, similar to that in FY 2026, excluding one-time insurance income. Other income was affected by roughly INR 4.5 crore in Q4 because of adverse foreign exchange movements. PAT for Q4 FY 2026 stood at INR 84 crore, reflecting a strong growth of 23.6% YoY. For FY 2026, PAT stood at INR 302 crore, up 14.8% YoY on an adjusted basis. PAT margins improved to 19.7% for the quarter and 19.5% for the full year. Our balance sheet continues to remain a key pillar of strength for the organization through focused working capital management and disciplined execution. We have maintained stability in working capital levels relative to FY 2025. The reduced working capital intensity, coupled with an expanding margins profile, enabled strong cash flow conversion during the year, resulting in cash flow from operation of approximately INR 445 crore for FY 2026. Further, our treasury position has strengthened meaningfully with total liquid assets of around INR 430 crore. This provides us with significant financial flexibility and cushion as well to fund future growth initiatives through internal accruals. We also continue to invest with a long-term perspective. Our ongoing CapEx program is progressing as planned, with the CapEx of around INR 460 crore deployed during FY 2026. Looking ahead, we expect total CapEx for FY 2027 to be in the range of INR 450 crore-INR 500 crore, primarily directed towards expanding our high growth capabilities and creating sustainable long-term value for all stakeholders. With that, we are ready to commence the Q&A session. I'll turn back to the moderator to invite the first question. Thank you. Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on the touchtone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Pankaj Tibrewal from Ikigai Asset Management. Please go ahead. Yeah. Good morning, Ashish, and good morning, Pankaj. First of all, congratulations on good numbers. Sorry to interrupt, Mr. Pankaj. May we request you move a bit closer to the microphone? Yeah. Can you hear me now? Yeah, please go ahead. Yeah. First of all, congratulations on good set of results, great to see the balance sheet and cash flow discipline. The cash flow generation was extremely good, congratulations on that. Ashish, what I wanted to understand is that after many quarters, we have seen this growth come back. Can you just help us understand that you talked about late teens growth on volumes. At least with that, there will be some steel price inflation. What are the projects which we are doing over the next two, three years, how the size and shape of the company will look like? What are the new areas we are entering into? Can you just give us some color on the growth side, which will help us think about the company in a better way? Over the next two, three years, what is the size and shape looking like? Thank you. Sure, sir. Thank you, sir. If you see from the last quarter, in the last quarter, or in the last four months, we were able to acquire another INR 140 crore of new businesses across various sectors, largely on industrial side, which is towards the data center business and also towards the passenger vehicle business. We see that the journey for the PVs and the industrials will continue very strongly in the next two to three years. Accordingly, infrastructure is being created, and accordingly, we have a strong order book. The order book for the new businesses today stands at nearly INR 950 crore, which will be executed in the next two to three years. Accordingly, infrastructure is getting built, which is a very strong diversification point. Even on the CV side and on the farm equipment side, especially on the CV side, we expect a large market share gain starting from this year, as a lot of development has been done for domestic as well as global commercial vehicle manufacturers. Put together all this, we see a market share gain this year, starting from this year, and also the new segmental growth on industrial as well as PV will be a major growth driver going forward for next two to three years. If you look at the mix, the mix will change to a decent level where we will have commercial vehicle contributing around 27% going forward. You can see there is complete shift, which will happen from currently around 37%. At the same time, we expect industrials to be large part of the business, which will be around 30%, 31% from 11% right now. Passenger vehicles, we expect improvement from 6% to almost 10% going forward. These are the major changes we see, and accordingly, infrastructure development is being done right now. Product mix, currently, if you see the product price, largely the product price that we today cater is around INR 60,000. We are working on the projects where the product price is around INR 25 lakh. Starting from currently, the heaviest component we do is roughly around 200 kg, and going forward we are talking about two tons. That's kind of a transformation shift we are talking about. That's great to hear. The second question is that when you look at last year, there were headwinds from export side because of tariff and because of many other reasons. How do you see the export visibility this year across your segments, and are there any new wins both on automotive and industrial side? Can you share some detail with us how you're looking at the export front this year, please? Thank you. We expect we started some of the projects for North America for which we have already started ramping up. Large part of the business will start coming from second quarter onwards for North America. These are for pass car sectors. We have further gained more programs, one more program with the same client, which is going to start from FY 2028 onwards. That's on the PV side. On the industrial side as well, we have gained a large order from Europe, and the commencement of that will actually start from FY 2029 onwards. The export sector for the new and for the existing clients, as we see, CV, as for the company and as for the recent commentary, we are seeing that should grow this year by mid-single digit this year. Inventories are more or less aligned and should be a decent year in terms of exports to Europe, which is our main contribution today. On the industrial side and with currency favoring, we see export segment will grow as there is a lot of opportunity coming from Europe at this point of time. Great. Thank you, Ashish and Vishu and your team. All the very best and continue the good work. Thank you. Thank you. Thank you. Thank you. The next question is from the line of Sahil Sanghvi from Monarch Networth Capital. Please go ahead. Good morning, and again, many congratulations for outstanding results. Just continuing on the previous participant, what kind of price hikes are you asking from your customers in terms of percentage? Would it range in roughly 5%-7%, covering the raw material inflation and the other input cost, be it logistics or any kind of manufacturing cost? In terms of if you look at our cost structure, because we are into very high value-add product and steel is a passthrough for us on the domestic side with one month lag and on the export side with a lag of one quarter. We are not worried about the steel price passthrough. With regards to the cost, there is the cost increases on the side of fuel. 7% today constitutes power and fuel, and 1% is fuel for us. On the fuel side, if you see, we have seen 30%-40% hike because LPG and fuel costs have gone up. If you look at the total picture, it is just 1% of our cost. We can see that around 0.3%-0.4% cost increases on the fuel side. With regards to the other manufacturing expenses, there are certain freight hikes and hikes on account of carbide consumption and other packaging materials for which company is in discussion. Besides the steel price, we are expecting around 3.5%-4% increase on selling price from our customers, for which our teams are in discussions. We have received confirmation from few OEMs. We are hopeful to get it from 1st of April. Got it. That's helpful. The numbers that you've given on the new orders received or the order book now with having the new orders, that includes the heavy forgings also, right? I mean. That includes the? Heavyweight forgings that we are mentioning. Yes. out of INR 950 crore, INR 250 crore of order books is currently on the heavy businesses related to data center, and which is currently in a range of 700 kgs to 1.8 tons. Got it. That's helpful. Well done by your team. Thank you. Thank you. Thank you. The next question is from the line of Vijay Pandey from Axis Capital. Please go ahead. Hi, sir. Thank you for taking my question. Congratulations for excellence and top number. Sorry to interrupt, Mr. Vijay. May we request you move a bit closer to the microphone? Is it okay now? Yes, please go ahead. Priya, congratulations on excellent set of numbers. Sir, two questions first on the cost inflation and energy inflation. Are you seeing any impact in the current quarter and how is the negotiation with the OEMs going in terms of the price increases? As just explained, with regards to the cost hikes, you can see that 60% for us is a gross margin. If you look at the manufacturing cost, around 7% is power and fuel. For power, there is no hike for us. Fuel is 1% of the cost, where the cost hike is there by almost 35%, 40%, which is 0.3%, 0.4% of the sales value. There are other manufacturing related costs which have gone up by 2.5% of revenue, which are regarding the carbide prices, packaging goods and freight, et cetera. For this, we are in touch with our customers and we have confirmations received from our customers to pay it out from 1st of April. That has been in discussions. I think another 10, 15 days, we should be having confirmation from 70%-80% of our customers on this, where PO amendments will start. That's how we are looking at it. Plus, there is an improvement in scrap prices, which will also support us in current scenario. Okay. Thank you. That's good to know. secondly, sir, how is our export demand looking now, given the entire scenario, the geopolitical scenario? There was an expectation that the Europe demand should improve this year. Just want to get an idea how it's looking for you and for the industry as well? The export demand is robust, I must say, and the programs which were done in the last two years are taking good shape and are in good demand right now. The ramp-up is projected to happen as per the timelines, and we are working with OEMs on the same. There is no delays. In fact, we are pushing hard to ramp up for all these projects. That is a condition today, and we are not seeing any delays on the current projects. As far as demand from our existing customers are concerned, from the European markets, the demand is expected to improve by around single digit this year. At the same time, we see a lot of new projects from Europe because of the currency depreciating, there are a lot of benefits to European OEMs. Because of the gas pricing surging in Europe makes lot of business competitiveness from India at this point of time. That has been in discussions, and we expect because Q4, we were able to generate new order book of almost INR 150 crore per annum. We can see a very fast journey is happening in terms of the new businesses which are coming to us. Okay. Thank you, sir. Lastly, sir, we had previously also you had given us little bit feedback about the new CapEx. Just if you can highlight what is its status, how is it progressing, and what should we expect, like from when we can expect the revenue and potentially what can be the peak revenue from that business? There is a CapEx which is going on the 10,000 ton forging press line, which was already done in last year Q4, for which a major sector that will cater will be CV, farm and industrials, which is in line with the growth. There is another 4,000 ton press line which is starting by first quarter, which is expected to start very soon, which is kind of dedicated for the passenger car sector, for which we have large orders in hand, which is also going well in advance. There is one CapEx which is done on the wind side, especially for the wind pinion shafts, which is also in line, which is also starting from second quarter, for which also there is a good order books in hand. By end of FY 2027, we expect to complete our large CapEx, which is inclined towards the data center and heavy engine requirements, and for which the trials will start in early FY 2028 and should start expecting businesses from second quarter three of FY 2028. It's largely the machined businesses with a realization of almost INR 800-INR 1,000 a kg, and there is a testing period required, and that's expected to start from third quarter of FY 2028. Okay. Thank you, and all the best. Thank you. Thank you. The next question is from the line of Mihir Vora from Equirus Securities Private Limited. Please go ahead. Yeah, thanks for taking my question. Sir, basically, one question here is we see a very strong margin improvement over last few quarters now, and even despite our PV mix increasing and CV and farm staying stable. More color here into what kind of product or what realization here are we going into, which is driving this sort of a margin growth, because it is onto the gross margin front, we have seen an improvement. Some color on that front, like what new initiatives or what products are being added here? Sir, the PV businesses and the industrial businesses, which are growing fast, if you see, and also some of the new CV programs that we have taken are at higher realization, which is kind of driving the entire gross margin. The businesses, if you talk about the INR 950 crore businesses which are in hand today, if you look at the realization for those businesses, it comes out to INR 340, INR 350 a kg. Today, we are at averaging around INR 230, INR 245. We expect that on a medium-term basis, this gross margin improvements will happen because of the businesses in hand and the businesses are far more complex in terms of its tolerances and in terms of its requirements. That is how we see this overall picture on the gross margin side improving going ahead as well. Right. In the new products which we have entered here into PVs or industrials, do we see some kind of market share gains further, which will happen into that, driven by our sort of right to win in terms of capabilities and so on? PVs with one of our large customers, we were at around 32% market share, which has improved from 32%-47% from this financial year. We are ramping up for this customer. We have added one more line. Even on the CV side, we expect a good market share improvement in this year as we have started large invoicing for large CV player, domestic CV players. This is there on the market share side, and we expect this improvement to continue as there are other programs also starting in Q4 for the same OEMs. Right. Okay. Sir, just secondly, something which is sort of a broader set here. Our domestic CV leader has now acquired a company in Europe, basically still it is too early to say, but do we see this kind of synergy where they will sort of shift some supply for the European components to India? What kind of broader growth, like in a four-year, five-year period, do we expect some kind of traction from that as well? Can you come once again with your first question? What I'm saying is that our leading CV OEM, basically Tata, they acquired a company in Europe. Yeah. Now basically in that sense, do we see an opportunity here in a three, four-year down the line period wherein the component shifts from Europe coming back into India? Yeah. That can happen. The discussions are ongoing, but it'll be too early to say whether Tata Motors will be handling the sourcing for them. It'll be too early to say. Yes, discussions are ongoing. Okay. Finally, the CapEx outlay will continue to be in this range at the INR 400 crore mark for next year? Hello? Yes. Just a sec. I'll just give you that. Next two years, the planned CapEx will be in the range of INR 800 crore. Okay. This includes the CapEx on the solar side as well. Okay. Okay, sir. That's all from my side. Thank you. Thank you. The next question is from the line of Jaiprakash Kumhar from Korman Capital. Please go ahead. Sure. Hello, sir. Hi, Hi, sir. Question on the margin. It got a little bit cleared with the last question. Just clarity, the current one you are selling at INR 30 to INR 45, you said on the order book of INR 950 crore has a realization of INR 340 to INR 350, so it's almost 10x increase in realization. Did I hear that correctly? Hello? Our current realization is at INR 245 a kg. INR 245. The new businesses, which INR 245 a kg are current realization, whereas the new businesses in hand have a realization of between INR 345 to INR 350 a kg. Okay. Roughly around INR 90-INR 95 per kg is the difference between the new businesses in hand and with the existing business, which also contains the legacy forge business. Okay. Got it. It means that basically the current level of margins could improve going forward, right? Because the realizations are higher. Or are there any other costs because the precision might be higher? Is there any additional labor cost or anything which is involved in pulling down the margin, or it's just higher realization means automatically? Higher realizations, we are working more towards the technology components and with a higher precision requirement. Manpower will not be a major issue in this because on heavy components, the cycle times are more. Gross margins will definitely improve, and it should have positive impact on the EBITDA margins as well. That's on the medium-term outlook. As we can see that the businesses in hand have a better realizations. Even if you see in this year, the gross contribution has remained same despite raw material prices falling by almost 6% reduction was there in the raw material prices. Even despite of that, the realization has been similar to last year, which has probably helped us in improving our EBITDA margin. Got it, sir. Thank you, sir. Thank you. The next question is from the line of Akash from NV Alpha PMS. Please go ahead. Yeah. Thanks for the opportunity. Sir, clarification required on the INR 950 crore order book that you announced, the new orders that we have in place. That kind of order book is executable in how much time? This is within two and a half to three years period. Understood. I think last time this order book was around INR 800 odd crore. I think for that you had given a longer timeline. No, it was FY 2027, 2028, 2029. Understood. Okay. The realizations that you mentioned, the average realization on this new order book of around 340, 350, that will include the orders for the new plant as well, right? Where we have realizations of almost 700, 800 per kg, right? Yes. Understood. Yeah. Secondly, sir, wanted to understand what has been our growth on the CV side in value and volume terms, like have we grown in market share this year? Just a second. Yeah. On the Q4, the domestic growth on the CV side was almost 27%. On the PV side it was around 35%. On the export side, there was a degrowth on the CV side by almost 25%. Off- highway domestic, there was a degrowth of 6%. Industrials grew by almost 32% on the domestic side. Understood, sir. Sir, our industrials as a share hasn't grown. If we look for FY 2026 versus FY 2025, I think even on absolute terms, we haven't grown that significantly. Relatively, I think we have gone down 1%. I think 12% was the contribution last year. This time it's around 11 odd%. I think we had some new orders which were going to start for data center players, smaller data center players. That has started or is it still stuck due to the tariff and all of that? The projects that were there was not for data center, it was for heavy engine, which is ongoing. If you look at HFL growth on the industrial side, the domestic has grown by almost 59%, whereas exports were down by almost 11% this year. I'm sorry, industrial? Yes, for industrials. Oh, understood. Okay. Understood. Yeah. The last question on the solar CapEx, I think are we already done with it or what is the timeline for having our solar plant ready? Should start generating from Q4 onwards, and next year potentially we should be having 70%- 80% of the benefit for which we are already in the middle of the CapEx right now. Understood. That's great to know, sir. All the best. Thank you. Thank you. The next question is from the line of Maitri Shah from Sapphire Capital. Please go ahead. Yeah. Hello. Am I audible? Hello? Yes. Go ahead with the question. Yeah. Good morning. Just two questions. Firstly, on the capacity addition. If you could help me out by the end of this year and end of fiscal 2028, what sort of capacities we'll have on the forging and the machining side? Yes, thank you. Forging capacities in the last year have ramped up from 135,000 to 147,000, which is further expected to go up to 161,000 by FY 2027. Further it will be enhanced to 187,000 tons. Addition of almost 26,000 tons from FY 2027 to FY 2028. Okay. On the machining side? Machining side capacity will improve from 69,000 tons to 82,000 tons by FY 2027, and from 82,000 tons to 87,000 tons by FY 2028. This heavy engineering section that we are building up the capacity for the data centers and heavy engine orders. All these data center orders, these INR 200 crore will be executed post 3Q FY 2028 or there will be some executions happening over the course of the next six, seven quarters? It will start alleviating from first quarter FY 2028. Okay. Any targets for FY 2028? What sort of volume growth you're expecting, and how do you see the margins kind of inching up with these higher value orders coming in play? I wouldn't want to give any specific number to it, but on the overall position of the businesses which we have in hand, as already discussed, as the gross margin will improve, which will definitely have a positive impact on the overall EBITDA margin. Okay. Yeah. That is it from my side. Thank you. Thank you. The next question is from the line of Ronak Mehta from ICICI Securities. Please go ahead. Yeah, hi. Thanks for the opportunity. Congratulations, Ashish and team, for a good set of numbers. My question primarily is on the CV exports. Did I read it correct that this quarter, your CV exports declined in double digits? Ronak, we have major CV exports coming from Europe, not from North America. For us, the visibility on order books is good and we are seeing a single digit kind of a growth from these European players this year. Understood. Any plans to cater to North American CV OEMs because what we hear from others it appears is that the cycle is looking pretty good this year. Any plans to cater to those OEMs? We have started working and quoting some RFQs, and we have a dedicated team sitting in North America for marketing now. We'll be working in that direction as well. Perfect. Thank you so much. That's it from my side. Thank you. The next question is from the line of Prateek Shrivastava from Nivesh Wisdom. Please go ahead. Yeah. Hello, sir. Again, sir, congratulations on a great set of numbers. Your margins are increasing. You are able to pass through the increase in steel prices. You're gaining market share. Sir, everything we are doing good, the only thing I think where we're missing out is on this data center. Sir, we are seeing that the data center and AI infrastructure boom is happening right now in FY 2027. Is it possible to sort of fast track this CapEx? Because Q3 FY 2028 looks little late. What are your thoughts on this, sir? The programs that we have and where we have to cater in, these companies are setting up complete plants to cater to these requirements. These infrastructures are not available right now. The growth which is expected to come from 2028 to 2035 is enormous. Accordingly, as we discussed, most of these large companies are creating infrastructure because ultimately these shafts, these products will go in large engines. These large engines will go in large gensets. There's a complete requirement. Even if we move very fast, it depends because the infrastructure needs to be in place, which most of these OEMs are creating. We are working hard to create the infrastructure. We are expecting that by Q4 we'll be ready. There is a development lead time and the testing lead time is expected as well, which will take six to nine months to start our activities in terms of our revenues. Infrastructure-wise, by Q4, we will have most of the infra in place. Got it. Do we have some sort of MOU, some sort of early agreement with any of these data center players whom we are working or closely collaborating with? We'll be working over here with large engine companies that manufacture large gensets for these data centers, and we already have good visibility from these companies. Being a new player in this sector, some OEMs we are in discussions and are also waiting for infrastructure to be in place. That we already have a good order book and there is some investments already done by these OEMs with us in terms of their development of tool costs and other related activities. That commitment is there. Oh, great. Okay, sir. Looking forward for the next quarterly con call and maybe you can throw more light on this in terms of the partnerships, early trials, things like that on this heavy machinery data center. Thank you, sir. Sure. Thank you. The next question is from the line of Lakshminarayanan from Tunga Advisors LLP. Please go ahead. Yeah. Thank you. Two questions. I just want to understand what is the contribution of crankshaft in the overall business for FY 2025 and how is that for FY 2026? The capacities which you are setting up, are we planning to increase the throughput of crankshaft in particular? Thank you. Contribution is nearly 50%, I can say, between FY 2025 and FY 2026. Okay. That's for the crankshafts, yes. That remained the same for the two financial years, or it went through an increase? I just want to understand with respect to the previous year. Yes. From previous year it was flattish, you want to understand going forward. Yes. It will improve. We have a sheet here on this. It is going up to 58%-60% by FY 2028, 2029. Got it. In terms of the commercial vehicle automotive, I understand that there is a decline in these Heavy Commercial Vehicles, or there is a trend towards tractor-trailer, which means that the requirement of axles may be changing. Is that true, and does it actually positively or negatively impact us? Sir, front axle beam is something that we started late in the industry, and because of this change, we have taken up some latest programs on the new axle beams. With regards to crankshaft, we are a very large player on the CV side, where we are working and there is no change on those sides. Some of the new developments are happening on 9 liter and 10 liter applications in the domestic side, and with major players in the industry, we are already there. The ramp-up will happen for the new set of engines, we already have our products tested for that. Got it. Sir, in terms of the new products or the new wins that we have got in this year, is this a replacement of completely new products, or is it that we have actually displaced a competitor? If so, what is the proposition of us to displace a competitor? Sir, some are PV programs, PV is a new segment for us, which we started two, two and a half years back. So all these products are new for us. There'll be part of the new growth which is coming in. Also on the export side, some of these products were done in-house by some of the large OEMs, which they no more are investing in-house, so there is an opportunity to supply. As far as the other data center related businesses, there is definitely a growth which is coming in. On the domestic side, on the CV businesses, the market share is improving for us, and over there we are definitely working on improving our market share. Is it because any other player are vacating a particular product segment, or is it that your proposition is stronger than the incumbent? You see in the last five, six years, we have invested very heavily on the crankshaft side of the business, which has played well for us. In terms of technology, we are ahead, and there is a lot of new investments that has done in the past couple of years, where OEMs have started working with us two to three years back, which is kind of helping us gain our market share. Perfect. Thank you. Thank you. The next question is from the line of Nishant Chauhan from IndusInd Nippon Life. Please go ahead. Yeah. Hi, am I audible? Yes. Okay. Thank you. Firstly, on the farm equipment segment, sir, I would like to know whether this segment is largely export-oriented, or we cater to domestic players. Yes, hello. Farm equipment is largely domestic for us, but we are also working on some programs on the European farm and North American farm side. Next two years, we'll also have export share improvement on the farm side, but currently it is largely domestic. We also have indirect exports, which is happening for farm transmission parts, but it is largely domestic. Okay, sir. sir, this year particularly, I think farm segment has seen a quite impressive growth of 20% plus, whereas if we ICRA farm numbers, it would be something around, say, 10%. Is there scope for us to get more market share in this particular segment, or how should one see it? For here, we are expecting, we were working on some new programs, definitely this year we are expecting some improvement on the market share side. It should start reflecting. The work is ongoing. There is a replacement and there were some developments that was done in the last year. Should be in a position to do better this year in terms of our market share and on the farm side is concerned. Also on the capacity side, we have invested in the last year on two crankshaft machining lines also on the farm side. We expect the utilization levels will improve on those sides. Okay. Sir, finally, I think your volume guidance of high teens for this particular year is quite encouraging. Sir, just if you could give slightly more detail, I mean, which segments should we look, which would be contributing to the growth quite heavily? Because I think farm and CV segment outlook, even by most players, is something around flattish to maybe mid-single digit. How would you break up this high teens kind of a growth guidance that you're giving? For our product range, we are currently at 32% market share on the CV side, which we expect to go up to 42% on the MHCV side. Simply on the market share basis, we expect good growth. CV alone, we are expecting almost 35%-40% growth this year for us because of the new programs and the new ramp-ups, which is ongoing. On the farm equipment side, we expect market share to improve by almost 4%. We are currently at 41%, which should improve to around 45%. Simply on the basis of market share, I am discussing. Yes, as of now, the FADA numbers report signals a good start because April, if you see the FADA report for tractor, was 23% up for farm equipment sector and MHCV, it was close to 15%, where HCV was 8% and MCVs were almost 27%. Also the pipeline inventory for both these sectors are fairly low at this point of time, which gives a good signal in terms that the production should continue. Okay, understood. A high 35%-40% growth in CV is expected this year, segment-wise. Thank you. Can you come again? Yes. Thank you. Thank you. Ladies and gentlemen, we'll take that as the last question of the day, and I now hand the conference over to the management for closing comments. Thank you everyone for joining. To conclude, we are confident that our investments in innovation capacity and customer partnerships will drive sustainable growth and value creation. With this, I would like to thank everyone for joining on the call. I hope we have been able to address all your queries. For any further information, kindly get in touch with Strategic Growth Advisors, our investor relations advisors. Thank you once again. Thank you. On behalf of Happy Forgings Limited, that concludes this conference. Thank you for joining us, and you may now disconnect your lines.