Good day, ladies and gentlemen. Welcome to the HEG Limited Q3 FY 2024 Earnings Conference Call, organized by SKP Securities 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 the conference call, please signal an operator by pressing star then zero on your touchtone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Navin Agrawal, Head, Institutional Equities at SKP Securities Limited. Thank you, and over to you, sir. Good afternoon, ladies and gentlemen. It's my pleasure to welcome you on behalf of HEG Limited and SKP Securities to this financial results conference call with the leadership team at HEG, HEG. We have with us Mr. Ravi Jhunjhunwala, Chairman, Managing Director, and CEO, Mr. Riju Jhunjhunwala, Vice Chairman, along with their colleagues, Mr. Manish Gulati, Executive Director, Mr. Om Prakash Ajmera, Group CFO, and Mr. Gulshan Kumar Sakhuja, CFO. We'll have the opening remarks from Mr. Jhunjhunwala, followed by a Q&A session. Thank you, and over to you, Ravi ji. Thank you, Navin. Friends, good afternoon, and welcome to our Q3 Financial Results Conference Call for the year 2023-24. As per World Steel Association's data, total world steel production did not register any growth in 2023 as compared to 2022, and remained more or less similar at the same level of 1,882 million tons last year. Similarly, world steel production outside of China also remained similar, at the similar levels as 2022, at about 868 million tons. Chinese steel production, while growing in the first half of 2023, dropped significantly in the second half and full year period of 2023 to 1,020 million tons, which was again in the same region as 2022 due to demand erosion. However, persistent low demand, domestic demand within China, resulted into increased Chinese steel exports, which increased by about 34% from 67 million tons in 2022 to 97 million tons in 2023, obviously putting pressure on steel production in the rest of the world. Among some of the large steel-producing regions, U.S. stood at the same level in 2023 at about 81 million tons as in 2022, while production in E.U. declined by about 7%. India, at the same time, grew by about 12% on the back of healthy domestic demand from infrastructure and real estate sectors. Here, we need to remember that in India, steel production is predominantly through blast furnace route, and also a significant portion of steel is also produced from induction furnaces, which is not our customer segment. We continue to concentrate on our exports, which remained at about, which remained at above 70% of our total sales in the first three quarters of the current year. Coming specifically to our Q3 performance, as you can see from our results, the electrode pricing remains under pressure, although we operated at about 85% capacity utilization for all the three quarters combined at 80,000 ton capacity. Due to long duration of production cycles for our products in the previous quarter, the commercial production from our expanded capacity to 100,000 tons did not go into the market. We will start selling, electrodes from this quarter from this expanded capacity. However, our capacity utilization remains the highest among all the Western world graphite electrode companies. The Needle Coke prices keep correcting due to difficult market conditions, but there is always a time lag between Needle Coke procurement time and sales of finished electrodes. As you know, our production cycle varies between 2-2.5 months to 5-5.5 months. Our raw material inventory levels are now normalized and do not have any inventory overhang. Global economic uncertainty continues to limit steel demand and thus constraining steel production. We do not see much improvement in steel production in 2024 also. However, the positive for our industry is that the deCarbonization efforts have now become an irreversible process with more and more electric arc furnaces, greenfield electric arc furnaces being announced every month. To date, as per our information, more than 90 million tons of new greenfield capacities have already been announced in different parts of the world, with U.S. and E.U. leading these numbers, and we keep seeing such announcements regularly. Out of this, about 9-10 million tons is already into operation. Another 30 million tons is expected to be operational between current year and 2025, and rest of it, post-2025. As we have said in our earlier calls, we expect graphite electrode demand to increase gradually by about 150,000-200,000 tons by 2029, 2030. This is a significant increase over current demand of about 500,000-600,000 tons of ultra-high-power electrodes, excluding China. Just to repeat the context for anyone who is new listening to this call, steel industry causes 7%-8% of total man-made pollution in the world, and about 23% of all industrial pollution. Steel produced through blast furnace emits about 4x more Carbon than the same steel produced through the electric arc furnace, and this is what is giving a very strong push all over the world, where companies are switching from blast furnaces to electric arc furnaces. The Western world production through electric arc furnaces, without China, which used to be around 44%, six to seven years ago, has already reached 50% in 2023, and is likely to exceed 55% in the next three to four years. Friends, as you know, we have successfully completed our expansion, and our new facilities are running perfectly well. Other than HEG, no other company has announced any new capacities in the Western world. It takes at least four to five years to build a new greenfield capacity and about two to three years to expand an existing brownfield plant. On the contrary, one of the graphite companies, one of the leading graphite companies, has recently announced closure of one of their plants in U.S., with a capacity of about 25,000 tons. You're aware that HEG has been exporting more than two-thirds of its production to some 30+ countries for a very long time, and we have a diverse and established customer base, and we are working hard to get a larger piece of their requirements, and we also keep adding new customers from time to time in several countries. In this backdrop, our expanded capacity of 20,000 tons per annum has come at an opportune time when the electrode market is likely to expand at a fairly fast pace around the world. While we remain solidly upbeat about the continuous growth of electric arc furnace production in the coming decades, resulting into continuous rise in electrode demand, at present, we are seeing a period of subdued steel production due to several global factors, which is likely to continue through the first half of 2024, resulting into subdued demand for our products for the next few quarters. We believe electric arc furnaces will grow at a CAGR of about 3%-3.5% in the next decade, which will directly translate into a substantial increase in the electrode demand. In the backdrop of a fairly high technology area that we are operating in, we don't see any newcomer or any new electrode company coming into business. We at HEG have been operating the world's largest graphite plant under one roof, with a capacity of 80,000 tons for a long time, and currently with our expansion to 100,000 tons, which is now operational, we are now amongst the lowest cost producers in the world due to economies of scale and our operational efficiencies. Now, a couple of words about our new subsidiary, TACC. Due to economies of scale in the CapEx outflow and considering the huge demand expected in the EV sector, the board has approved the decision to start with a 20,000-ton graphite anode powder plant in one go, which initially we were planning to do in two phases of 10,000 tons each. The land is already acquired, and the construction has started, which we intend to complete by mid-2025. We'll keep you informed about this progress from time to time. In conclusion, friends, our third quarter 2023-2024 has been satisfactory given the tough market conditions under which we are operating. The next two, three quarters may see margins remaining under some pressure, but we are hoping that the demand would come back sometime from second half of 2024, and we are going to take full advantage of our expanded capacity. We have all the technological capacities, operational efficiencies, and market reach to take our company forward and to succeed and thrive in all emerging situations, creating long-term value for our shareholders. With this, I'll now pass on the floor to our CFO, Gulshan, who will take us through the financial figures. Following that, our Vice Chairman, Riju, and our Executive Director, Manish, and I will be delighted to address any inquiries you may have regarding electrodes and also graphite anode powder. Over to Gulshan. Thank you, sir. Good afternoon, friends. I will now briefly take you through the company's operating and financial performance for the quarter ending 31 December 2023. HEG recorded revenue from operations of INR 562 crore, as against INR 614 crore in the previous quarter, and INR 534 crore in the corresponding quarter of the previous year. Revenue for the quarter saw a decrease of 8.5% compared to the previous quarter. During the quarter ending 31 December 2023, the company delivered EBITDA, including other income, of INR 110 crore, as against INR 130 crore in the previous quarter, and INR 173 crore in the corresponding quarter of the previous financial year. The company, on a standalone basis, recorded a net profit after tax of INR 37 crore for the quarter ending 31 December 2023, as against INR 62 crore in the previous quarter and INR 103 crore in the corresponding quarter of the previous financial year. The company is a long-term debt-free and having a size of nearly INR 950 crore as on 31 December 2023. Now, we take more questions from the participants. A detailed presentation has been uploaded on the company website and on the stock exchange. Now, we would like to address any questions or queries you have in your mind. Over to Nadine. Thank you very much, sir. We will now begin the question and answer session. Anyone who wishes to ask questions may please press star and one on their touchtone phone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use only handsets while asking a question and limit themselves to two questions. You may join the queue again, and time permitting, we will take your follow-up questions. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Pritesh from Lucky Investments. Please go ahead. Yes, sir, you mentioned the capacity utilization at 85% in nine months. Can you give us the capacity utilization for quarter three? Quarter three alone? Yeah. It's more or less the same. A couple of percentages, plus, minus. It's in the same region. Okay. We've been consistently running, let's say, at that level for the last few quarters. Which means the volume growth in nine months, over nine months, is largely flat, right? It's a flat volume. See, you see, you will see a volume growth compared between the two fiscals. So nine months, yes, there has been a volume growth, and, by the time we close the year, we believe that we would have sold about, 10%-12% more than last year. So you can take this figure of 10%-12% for the nine months. Okay. And sir, on the spread side, so what we see is that there is a continuous spread reduction from quarter one to quarter two to quarter three. Yes. When you said the capacity utilization is largely similar. So if you could just share the spread in dollar terms, what should be the spread? Dollar terms will be a very, will become a very specific answer to be given in the public domain. But if you just take our results, I think you can make a very good guess yourself about how our spreads have fared between the three quarters. They have been coming down, that is sure. That is what you see in our bottom line. And the main reason for that is, see, the raw material prices have also been coming down, but actually there's a lag effect. The electrodes take two months to make, and needle takes five months to make. So this, when electrodes fall, that takes time to spread, for the spread to adjust. You know, the consumption will go prices higher, and the electrode prices are lower for that particular quarter. So that's what hurts. That's very unique to us, just because of long process times. Okay. My last question is, we are hearing about this electric arc furnace-led capacity addition from your side, and electric arc furnace-led steel growth from your side for the last five, six quarters now. Let's say when you're giving the steel production number of 188.183 million and saying it's flat, what is the electric arc production from electric arc furnace and the growth rate? You see, as I, as I gave you that figure in my, in my, short speech, it used to be 44% till about five to six years ago, minus China, and, which has gone up to about 50%. So in the international concept, 44-50 is like 15-17% increase, which is pretty substantial if you, if you look at the whole world. And, in the next three,four years, this is probably going to go beyond 55-58%. So which will be like from, uh, 45% to 57-58% or close to 60% over a six,eight-year period. Sir, I was asking about calendar year 2023. What is the production growth from electric arc furnace? Is there any growth? See, I will give color to that. You see, the electric arc furnace steel, it will be about 430 MMT in rest of the world, and add about 120 coming from China, 110 or 120, well, they will need to come with figures. So should we view to—if your question is: how much of that 1,888 million metric tons is electric arc furnace? My answer would be about 540-550. And this 430, has it grown this year? See, 430, as you have seen in the figures, the, in the World Steel Association, we also mentioned in the call, it's absolutely stagnant for all regions. China did grow in the first half, then dropped in the second half, and then the rest of the world, exactly the same level. If you look at 2022 figures, 2023 figures and 2023, they add up to almost exactly the same number as barring one or two million tons in such a large base. So the steel production has been stagnant, and thus, the electric arc furnace as a proportion of that has also been stagnant. Perfect. Thank you very much. Thank you. Thank you. The next question is from the line of Mihir Vyas from 9 Rays EquiResearch. Please go ahead. Hi. Thank you for the opportunity. I wanted to ask, can you give some color on potential revenue and margins from the anodes business? Vijay, will you take that? Yeah. Yeah, the potential, see, we are investing around INR 6,200 crore into this particular business. And the investment to output ratio should be more or less 1:1, or depending on the qualities, around 1:1.3. And as of today, as per our business plan, we are assuming a safe margin of around 25%-30% EBITDA on this particular business going concern, as, I mean, second year onwards, kind of, you can say. Okay. The planned production should start around March or April of 2025. Okay. Thank you. And one more question I wanted to ask: How much drop in EBITDA margin is expected due to the drop in demand and excess supply from China? I mean, India cannot produce any... If you're asking about the anode powder, today, India does not- No, no, no. Produce any anode powder. I'm asking about the electrodes. An electrode, Manish will answer that, I think. Yes, sir. See, you're specifically asking about what is the impact, impact going to be because of China. My answer to that would be that, China predominantly makes and also exports the high power grades, which is not the ultra-high power grade. They're not yet as established as the main players are. We are trying, but, we do not see that we do not relate as to in this way, that because of China, what is going to be the margin reduction? We don't look at it this way. We look at our segment in which we operate, where we are strong, that is ultra-high power grade, where our western producers are the main competitors in that segment. Okay. So I believe there won't be any reduction in capacity utilization for the same reasons? Sorry, can you repeat, can you repeat that question? I believe there won't be any capacity reduction in capacity utilization for the same reason, right? Still not clear. Hello? Your voice is cracking in between. Sir, Mr. Vyas, may I request you to kindly use your handset? Am I audible, sir? Yeah. Your voice is breaking, sir, actually. May I... Are you in the network area? Yeah, I am. Okay, now- I'll join back the queue. Is it better now? Yes. Please continue. I was asking, I hope there won't be any reduction in the capacity utilization because of these reasons, right? 85% all through the year, we are working at highest capacity utilization in all of the industry. And as we go into this 2024, we'll be counting ourselves as 100,000 ton capacity. But of course, for some one or two quarters, just because we now base our utilization percentage on 100,000 tons, you will see a little bit of reduction in that. But we'll climb up on that, and we are sure that within a matter of one to two years, we'll be within a matter of one year, we'll be back at 85% on 100,000 also. So if you compare some of our... I mean, we have only three or four main competitors in the world, I mean, if you exclude China. As Manish rightly explained, we are not really competing with China in that segment. In this higher segment, there are only three, four companies in the world. If you are tracking them, it's all public information. At least one of them is operating at low 40s, 40, 42, 45% kind of utilization. The others are in the region of 60-65. We still believe that we are at 85%, which is probably the highest in the industry. Okay. One more question. How is our arrangement with suppliers contracts on quarterly, half yearly or yearly basis? It's normally quarterly. It's- In a declining market of electrodes and a declining market of raw materials, it is quarterly. Okay. So I will join the queue if I need something else. Thank you. Thank you. A reminder to all the participants that you may please press star and one to ask questions. The next question is from the line of Saurabh Jain from Sunidhi Securities. Please go ahead. Hello. Yeah, thanks for the opportunity, sir. My question is about graphite anode facility. Recently, there has been, you know, article that, news article that, says after Toyota, BMW has also, said goodbye to electric cars. So what are your thoughts for our upcoming anode facility, considering the huge CapEx, we are doing? Also, there have been other articles saying that Lithium-ion battery performance has reached a plateau in recent years, and using silicon instead of graphite enables, significantly higher energy density and faster charging. So that's why it's been, focused by many OEMs, global OEMs like GM, Mercedes, even Airbus. So, I know on the last call also, you had clarified that you don't seem threatened by this development, but this news has been, you know, quite persistent for last couple of quarters. And now it is a strong signal for after Toyota, BMW, what BMW did last week. Yeah, your thoughts, please. So there is, I mean, you can, like, there are new developments happening almost on a weekly basis, new kinds of technologies, new kind of things. But as far as the core goes, I think Lithium-ion batteries are here to stay for the next two decades, at least two, three decades. And some kind of improvisation will keep happening, mixing of silicon, mixing of some other elements. But graphite, as the core conductor of this thing, we do not foresee a big change in volume. Again, like you have Lithium-ion batteries, everyone's talking about Sodium-ion batteries as far as the stationary applications go. There also, I mean, we will be in a position to produce Sodium-ion, the raw material for Sodium-ion batteries as well. In the next few years, I think, Lithium-ion as the main infrastructure for moving batteries is not something that will, that we at least seem too distinct about, of being replaced by something else. You keep seeing changes, you keep seeing whatever, but the infrastructure once made for Lithium-ion, in terms of charging, et cetera, et cetera, we do not see that thing changing. Plus the big plants of Lithium-ion batteries that are coming up in India, they have already been announced, and they have already been implemented, and they are more than 50,000 GWhs of facility that is coming up within India by established names like Exide, Amara Raja, Reliance, Ola, et cetera, et cetera. That itself means a graphite powder consumption of around 50,000 tons, which will include stationary applications also. So, I mean, this, this, this question will keep happening, you know, I mean, every one month, some kind, some new technology will come, and it's happening over there. And rest assured, there's a lot of innovation happening at our own end also, how to keep pace with all these innovations so that we can keep, you know, trying to produce the raw material that will ultimately be required for these applications. Okay, that's helpful, sir. Sir, my last question is, if you can point out some difference or your opinion on how come we are, you know, our utilization is around 85%, while other players are running at 40%-65%? We are more competitive. This is relative performance. That's all I can say. It's competitive on costs, competitive in marketing. Whatever, I mean, this, but that, that's true. Okay, fine, sir. That's all from my side. Thank you. All the best. Thank you. The next question is from the line of Rajesh Majumdar from B & K Securities. Please go ahead. Yes, sir. Thanks for the opportunity. So I had a few questions. I just wanted to know, you mentioned about the world's largest producer operating at 40% utilization. It's common knowledge now. So, is there any takeover opportunity for any M&A activity available in the space right now? There are only three core players. I mean, there's nothing hidden in this industry. I mean, if you, if you really study whatever is available, there are, there are only three, four players. So whatever will happen, if at all it happens, it, it has to be only between these three, four, no nothing else. Actually, let me ask this question the other way around. I mean, now even at 40% utilization, the cash flows are above $1,000 for this player. So how is it likely to play out? Either it shut down or it gets acquired, and then the prices start moving up, or will the prices start moving up on its own? And the related question to that, if the prices start moving up again, is there enough capacity in the world today to absorb this, you know, the new demand? Because if the industry is operating at around 50% or 60% rate, then even if the demand grows in the next two or three quarters, then there's adequate capacity available to absorb this demand, which can put a cap on the prices. You see, as far as your first question is concerned, I mean, obviously, nobody can talk about it in public domain. I mean, the second question, yeah, you are right. I mean, whatever is the overall capacity utilization, whether it is 40 or 70 or 80, it will, it will, keep going up as the demand keeps growing. But just to clarify one point, which is very typical in our industry, it takes, as I said, between two to two and a half months for the, for the easiest electrode to produce, and it takes as long as five to six months for something called nipples, which is, which is a pin which joins the two electrodes. Right. Right. Yeah. Although the weight is only 4%, but without that nipple, the electrodes are of no use. So that takes anywhere between five to six months, depending on the size, quality, and things like that. So given that, the process is very long and not just long, but there are four or five different processes in which, within which the electrode is produced. So even in the very peak demand or highest prices that this industry saw in the 2017, 2018, 2019, the overall capacity utilization of each one of us, combined or separately, I don't remember the exact number, but it would not be more than 90%. Because it's not easy to run the entire plant with five different processes at more than 90%-91%. I mean, something or the other in the large plant does break down, and that has an impact on the, the whole supply chain, on the whole production chain. So given that, given this peculiar issue with the graphite electrode industry, where, let's say 100%, 100% is 90% and not 100%, so this is what it is. So the demand of electrode, I mean, if we are talking about 90 million tons, which is already 90 million tons of new Electric Arc Furnace capacities, which are already announced, and it is a lot of this information is in public domain as to who is putting up, how, what size of the plant and, but when are these plants going to be operational? The growth is going to be very large. I mean, once this 90 is all established and operational, the increase in demand will be, I mean, I'm just quoting somebody else, somebody else meaning one of our, one of our, competitors. I mean, they are talking in the, in terms of 200,000 tons. This 90 million tons is not a fixed number. I mean, as you can imagine, we, we track this, this part of the information very closely every month, every week, and this number keeps increasing. I mean, as late as three, four weeks ago, this number used to be 84-85 million tons. So in the last 30 days itself, there have been new announcement of 5-6 million tons. So it keeps, it keeps increasing because this Carbon emission and environment is here to stay. It is not going to go away anytime soon. And especially in America and Europe and other parts of the Western world, they are taking it extremely seriously. So basically, this is the answer to your inquiry. Yeah, right, sir. And my other question was regarding additional 20 KT. Who is the supplier of Needle Coke for this? Because as I understand that there are limited number of Needle Coke, petroleum-grade Needle Coke suppliers, and that is a big constraint in the graphite electrode space. It's not a constraint. I mean, there are four, five suppliers. But yes, I mean, if the electrode industry gets back to 1992, 95% capacity utilization, then the demand of needle coke and the capacity of needle coke and the demand of needle coke for the graphite industry will be more or less matching. It is. There is still enough capacity to supply. I mean, there will be occasional mismatch, where maybe one month, two months, three months, somebody will be short of supply. But at current level of 80-90 million tons of additional capacity of electric arc furnaces coming in, resulting into more demand of electrodes, the supply of needle coke and demand of needle coke is more or less going to match. If I can add a last question, is there any capacity coming in Needle Coke anywhere in the world, any investment capacity? No, nothing. I don't have that figure in mind, but probably the last Needle Coke plant would have been put about 45-50 years ago. So it's like, exactly like graphite. I mean, we came into production in 1977, and today we are in 2024, so close to 50 years, 47 years. There has not been any new greenfield plant anywhere in the world. So it's exactly the same situation in Needle Coke. Probably I'm wrong when I'm saying 47-50 years. I mean, Needle Coke, last Needle Coke plant would have been more than, like, 60-65 years. Yeah. Okay. Okay, sir. Thank you so much. In both the cases, it's not a question about the technology. Thank you. The next question is from the line of Sahil Sanghvi from Monarch Networth Capital. Please go ahead. Mr. Sanghvi, I have unmuted your line. Kindly proceed. Yeah. Am I audible? Yes, sir. Yeah, you are. Yeah, thank you for the opportunity, sir. So, my question is more of about the supply-demand dynamics. I mean, while we, you know, on this call only discussed that probably the world ex-China demand for, you know, electrodes has not gone up or down much. And on the other side, you know, world ex-China electrode manufacturers' utilization has slightly reduced. So I just wanted to understand that why in that case is the pressure so much on pricing? And is this because one of the reasons is the Chinese electrodes? Because I hear that some of the HP electrodes also can be, you know, blended along with the UHPs. So, just if you can explain this a little bit, you know, in detail. I'll take the second part first. I mean, it's not possible to replace UHP electrode by HP. I mean, because there is a difference in definition. I don't know what you mean by HP and UHP. These are very loosely used terms. But to answer specifically, in a furnace, if you require a particular quality of electrode, which is, let's say, called UHP, you can't replace it by HP. It is basically, it's not a matter of that, instead of 2 kg per ton of steel, you can use 3 kg per ton by switching from UHP to HP. HP will just not work. It is not a question of 20%, 30%, 40% more consumption. So you need an electrode which will withstand the high temperatures in the UHP furnace. So that, that's the first answer. What was the second question? You repeated that? Yeah. So my question was that, what is the primary reason for the pressure on the prices of electrodes? Because, I mean, on one side we are seeing that the demand for electrode world ex-China has not grown or moved much, and on the other side, there has been these utilizations of few companies ex-China, which has come down. So, I mean, what's the real reason for the pricing pressure? I mean, you're answering your own question. I mean, obviously, there are four or five players in the industry, and whoever is more competitive will sell more. I mean, we believe our quality is as good as anybody else's, and we also believe that our cost structure is better than most of the others. So this is obvious. Okay. Okay. Got it, sir. Got it. Thank you. Thank you, sir, and all the best. Thank you. The next question is from the line of Sandeep Macchar, from Macchar Industries Limited. Please go ahead. Hello, sir. Am I audible? Yes, sir. Yes, you are. So basically, in short, my... I'm a investor. I have two questions. One, you said that you are already at, running at a capacity utilization of 85%. And now, as I understand it, we are ready with the additional expanded capacity of 30,000 tons. So that means, first we'll be able to achieve 100% capacity utilization of existing capacity, then only we can, I think, go for the additional expanded capacity. So by when we expect the additional capacity to be used? That is my first question. The second question is regarding the new expansion. You just mentioned that you have started construction for the graphites, which are used by EV industry. So I just wanted to know by when we expect that expansion to be completed and commercial production in place. These are the two questions. Okay, I'll answer the second one, which is EV. I mean, I already said in my opening remarks, we expect to be in production by, let's say, second half of 2025. So let's say sometime in July, August, September. Okay, okay. The first question about capacity utilization, so we can, it can be one to two years. It really depends. I mean, it's a very difficult, I mean, to pinpoint a month or a period when the demand will increase. Okay. It's an extremely difficult question, but only thing which is very satisfying for us is that we are still operating at 75, 80, 85% utilization. Okay. So which obviously indicates that our quality is acceptable, our margins are better than most of the other players, so which obviously means that we have some competitive advantage and our quality is similar to what others are doing. Okay. Okay, sir. Thank you, and all the best. Thank you. Thank you. Thank you. The next question is from the line of Vipul Shrivastava from InCred Research. Please go ahead. Hi, am I audible? Yes. You are. Okay. I just had a question on Turkey. So based on the data, as far as electrodes, imported Turkey are concerned, China is a very big player in Turkey. So I wanted to understand what kind of electrodes does Turkey import from China? Is it UHP, or would it pose a significant risk to our business? How do you look at that? See the most of the electrodes you will see here with the data which you are referring to, you will find that most of them are HP grade. You will also see some quantities here and there of the ultra high power grade, because the furnaces are different, and there are very high power furnaces, there are low power furnaces. So when you will also look at the data, you'll be able to figure out that there might be doing a trial here and there. But all I can say is that if you look at the big steel companies, they're not at that level yet, that they will be reliably giving 30, 40% of the business consistently year after year. You know, so that level is not there. Of course, they can make trial here and there, yeah. Okay. Noted. My second question was on the anode facility coming up. So just have two questions on that. First of all, about the technical expertise required for manufacturing of anodes. Do we have that technical capabilities, or are we doing it in tie-up with some other company? How are we going about that? So in terms of the people this thing, I mean, that consists of six, seven various processes, but the main process there also remains the graphitization. In graphitization, we are talking more about the older type of furnaces that HEG does not almost use today, which are the Acheson furnaces which are widely used. Right. -for the, anode applications. Right. Here we already have a very good, you know, pool of resources in-house, which we are already deploying on the design and development stage also of the facility. Okay. The rest of the facilities are, more or less machine-led, which, do not require too much of, you know, yeah, manual intervention. But yes, there's a lot of R&D required on, you know, which kind of, raw material to process, and, so there's a lot of trial and error over there, for which, one needs to work very closely with the customers, that we are already doing with our pilot plant, currently. So we already have a state-of-the-art pilot plant that is, fully, producing around 10 tons per month, and that has already started sampling with some, large companies and trying to work along with, them for their kind of requirements. So no, there is no technical tie-up with one particular company, but from time to time, we will be taking help from whichever technical resources are required. Okay, noted. And the other thing is the manufacturing of anodes, one significant cost is power cost, right? Because it's a very big component of anode manufacturing. So how will the facility be sourcing power for this anode facility? So, we've selected the state of Madhya Pradesh for this particular industry, in which we are getting a lot of subsidies from the government. And one particular subsidy is around a INR 0.50 reduction on the power cost for this particular facility. So the net cost of power to us should not be more than INR 5.50 for this facility when it comes up. And apart from that, obviously, the whole focus of the buyers in this particular industry is how much of green electricity are you producing? For which we are already in touch with a lot of, you know, solar and wind manufacturers to work closely along with us, to have a kind of, dedicated facility of, 200 MW, 100 MW, that kind of a number, in which we can, do a buyback arrangement with them for electricity. So that is still work in progress, but, you know, that will further bring the cost of, power down for us, which we hope, you know, this will not be more than INR 4 or INR 5 rupees as a weighted average cost of power. We have assumed around, INR 5, INR 5.5, INR 6 in our, business plan, but I'm quite sure by the time we work on it, we should be able to save on some power costs over there. Okay. Okay. Last question: so, as far as Indian anode market is concerned, how do you see it developing? I mean, are there, are there customers who are thinking of manufacturing batteries in-house? Because currently a lot of these batteries are imported from China. So how do you see this landscape changing? How is the ecosystem developing as far as the anode manufacturing in India is concerned? So the Indian battery we are missing, you must have already read around GWh of Lithium-ion battery manufacturing has already been signed up by the government. They will increase this by 10 MW, 10 GWh more. So there is a lot of scope for anode production over there. And apart from us and Himadri and some one or two more players, no one has announced very, very serious kind of capacities for the Lithium-ion battery so far. So we see ourselves as, you know, I mean, HEG has to be the leader in this as far as the timing goes, and that's what Chairman also mentioned when he said that we will start commercial production by the second half of 2025. Okay. Okay, thank you. Thanks a lot. Thank you. Thank you very much. Ladies and gentlemen, that was the last question in the queue. As there are no further questions, I would now like to hand the conference over to Mr. Jhunjhunwala for closing remarks. Over to you, sir. Thank you, friends, for asking some very pertinent and very pointed questions. I'm grateful to you for your interest in our company, and I will continue to engage with you on a quarterly basis, and hopefully with some better results, with some better numbers. Thank you very much for that, and see you again after about three months. Thank you, members of the management. Ladies and gentlemen, on behalf of SKP Securities Limited, that concludes this conference. We thank you for joining us, and you may now disconnect your lines. Thank you.