HEG, remember, the numbers were rather weak, actually. The margins came in at multi-quarter lows, and the management, to be fair, had indicated at the end of quarter one that the next few quarters as well will be quite subdued. What's the outlook, though? Mr. Manish Gulati joins us to help us out to understand exactly that. Hi, Mr. Gulati. Good morning. Thanks so much for joining in. Hope you, your family, had a good festive season, and hopefully things look up from a business perspective as well from here on. So let's talk about a couple of numbers. What is the capacity utilization levels in the past quarter? Do you expect it to improve from now on? And particularly, since you have additional volumes coming in from the expanded capacity, what will volume growth look like for this year? That's FY 2024 in comparison to FY 2023. Yeah. Good morning, Nigel. The Q2 was close to 85%, and Q1 was close to 90%. But going forward, as I've always been telling you, that in the next few quarters are tough for the industry, and we expect the October to December quarter to be close to 75%, and likewise for January to March. So, I mean, two, three, max four quarters, we'll have pressure on prices. There's much lower demand, although there are not much inventories in the system. So the good point is that when the demand comes back, it'll be, the upswing will be rather quick. Okay, so pricing will be subdued for the next three quarters, approximately. We got that. And, you know, you're saying that there's low inventory in the system. So let's get a couple of numbers. Normally, what are the inventory levels that are there in the system, and what is it currently, if you could tell us that? And also the volume growth number, you'll have additional capacities that are coming in there, though utilization levels on a blended basis could be lower. So will there be any volume growth in FY 2024 versus FY 2023? No, I don't, I don't expect a volume growth. Rather, there'll be a slight dip in volume, Oh. In this financial year compared to the last. As regards the average inventory levels of the system, you see what happens is this product is produced only in very few countries in the world. So depending upon your location, I mean, if you, if you are in a country where you do not have an electrode plant, generally, the people would keep between two to three months, depends upon where they are sourcing it from. And where you have, let's say, a country like India, where there are two players, two, two manufacturers of electrodes, generally, they would keep a month or month and a half. So what I'm trying to say is that there was a time when people were hoarding electrodes and keeping a lot of inventories, six months, eight months, even up to a year. So that is not the situation now. The supply chain is very lean. The steel manufacturers are not working with much inventory levels, so that is a good thing, that when the demand picks up, production picks up. It'll quickly translate into demand. That's what I'm trying to say. Yeah. All right. And talking about countries which are important for the supply chain, China is one of them, right? And China has taken some action recently, Mr. Gulati. They've curbed graphite exports, basically. Could you talk to us about what the implications could be for HEG? Does it give you a bit of a boost, at least in the near term? See, as I've said earlier also on your channel, with China, we compete only, only in the UHP segment. So their exports keep going up, down, but their sector is only, mostly, I would say, for the Ladle Furnace grade. So, I mean, depending upon their seasons, their winter seasons, they keep doing a lot of things, but yes, it is still a very big exporter of the non-UHP electrodes worldwide. As far as HEG is concerned, we are not exporting to China. We are not importing anything. Right. From China. It doesn't. So our concentration. Mm. And our focus is on the rest of the world. Okay. Mr. Gulati, I just want to come back to the earlier point that you made, both on volume and on pricing, because you're indicating that both in the near term could be lower. So for the second half, can you give us a sense of what will be the dip in volumes or, you know, if you could give us the absolute, you know, number as well? And again, pricing. You said pricing will remain under pressure for the next three quarters. How much pressure? I mean, can you give us some indication of the kind of decline that the market may see for the rest of FY 2024? Like I said, for the H2, please consider 75% to be a good number. Mm. Which was about close to 90% in the first quarter and 85%, close to 85% in the second quarter. So that is, that is the explanation on the decline in volumes. Regarding pricing, I mean, it's coming in sequentially, quarter-on-quarter, coming down 5%, 6%, that way. So that is, b ut when we talk about price, we don't see it in isolation. We look at compared to our prime cost. Raw material. Which is needle coke. So needle coke prices are also coming down, but in our kind of product, where there's a lead-lag effect and two months of processing time, two to three months of inventory, it takes a while for the needle coke prices to show up. So we are generally concerned more with the spread rather than the. Well, exactly. Prime prices. Exactly. Sir, that's exactly what I was coming to, that, you know, we've discussed the end product pricing, which is under pressure, but then now talk us through that spread. How will margins look like till this sluggishness continues in the second half? I cannot put a number, honestly. But. A range? This quarter, range, no, I mean, no, I still can't put a number, but they'll be under pressure. Let me, let me. Mr. Gulati. You, you. You know, you were fair enough to tell us the last time around, that was the dream run, when you saw 50%-70% margins, you know, a few years ago, and you said: Don't expect that honeymoon period yet again. But my worry is, now we're not talking about 50% or 70%, we're talking about 15% and 17%. Will margins improve from the levels that we saw. Right. In quarter two? Have they bottomed out, or will there be some more pain on the margin front, taking everything, volume, pricing, input costs? Right. There is still going to be pressure in Q3 and Q4 on the margin in terms of percentage. And we're just waiting for that upturn to happen, and they'll go back quickly. But are. Because the trajectory is very clear. But are we on a bottom on margins, sir? We get it that it's a sluggish market right now, but is 16%, is that the bottom, or is it down, you know, further down before that recovery comes in? Pressure in quarter two, second half. Oh, it's. Yeah, second half. It's not the bottom yet. How much more? No, it's not the bottom. It's not the bottom yet. Okay, got that. It's not the bottom yet. Okay, I think. Let's wait for. Okay. All right, probably down the line, lower margins, but not right now. Thanks very much, Mr. Gulati, for joining us and running us through what you're making of the business environment. Now, let's move on.