Ladies and gentlemen, good day and welcome to the Q3 FY 2022 earnings conference call of JSW Steel. As a reminder, all participant lines will be in listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing star then zero on your touchtone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Ashwin Bajaj from JSW Steel. Thank you and over to you, sir. Yeah. Thank you very much, operator. Good evening, ladies and gentlemen. This is Ashwin Bajaj, head of investor relations for the JSW Group. It's my pleasure to welcome you to our earnings call for JSW Steel for Q3 FY 2022. We have with us today the management team represented by Mr. Seshagiri Rao, Joint MD and Group CFO, Dr. Vinod Nowal, Deputy Managing Director, Mr. Jayant Acharya, Director, Commercial and Marketing, and Mr. Rajeev Pai, CFO. We'll start with opening remarks by Mr. Rao and then open the floor to Q&A. With that, over to you, Mr. Rao. Good evening. Good evening, everybody. The Q3 FY 2022 which just ended, it is a mixed quarter. Why I'm saying it is a mixed quarter? The steel consumption in India in this quarter, month after month has gone up. The overall demand growth in the quarter was 9%. In the month of December, the steel consumption was 9.29 million tons, which is the highest from April 2021. These are the positives which we are seeing that the month-on-month, the consumption of steel has gone up in India. This is the positive side. At the same time, if I look at and compare with the Q3 of last year, the steel consumption in this quarter has come down by 7%. That means the kind of acceleration which we were anticipating in the steel consumption in the second half of the financial year has not happened. The reasons, as you know, as far as India is concerned, were either extended monsoon or too many holidays, due to festival season in the month of November and the threat of Omicron and also slight slowdown in the overall global economic activity attributable to either tighter labor markets, tighter energy prices, supply chain dislocations, surging cases of Omicron. These are some of the reasons why we are seeing a slowdown in the economic activity worldwide, added to by the factors which I just mentioned earlier. In these circumstances, if I see JSW Steel, it is the highest ever quarterly crude steel production, 4.41 million tons of crude steel. If I just break up this 4.41 million tons, 180,000 tons is from Dolvi expansion, so we have produced 4.23 million tons from the existing operations by operating our plants at 94% capacity utilization relative to 91% in the previous quarter. Production-wise, we have done quite well other than the Dolvi expansion, which was under ramp-up during the last quarter. The sales also improved compared to Q2. We have achieved a 6% growth. It was 4 million tons of sales on standalone basis. Here, what is interesting here is the domestic sales once again crossed over 3 million tons. We posted 3.1 million tons, which is a growth of 31% quarter on quarter in the domestic sales. There are many highlights as regards to the sales. Our value-added steel products as a proportion of total sales went up to 62% from 60% in the previous quarter. In auto, we are seeing an improving demand. Let's say quarter on quarter it went up by 2%. The same thing between solar sector went up by 26%. The PLCS sector went up by 67%. The tin plate which goes into packaging, it went up by 34%. As per domestic sales, there is a very good increase in the overall sales. To that extent, there was a moderation in the exports. Exports was around 806,000 tons. The net sales realizations quarter on quarter on a blended basis if I compare, there's an increase of 2%. Again, auto sector, our prices got settled in the last quarter, so that also got reflected. Overall, there is an increase in the NSR by 2%. But the cost pressure was too high as we have guided last time. The coking coal price is $100, we absorbed. On the blended basis, the costs have gone up by 17%, so that has an impact on the overall EBITDA per ton. On a standalone basis, it is INR 16,980 per ton, which is 23.6%. Compared to Q2, it has fallen by around INR 5,900 per ton. While a significant portion of this increase is attributable to the coking coal price, but a part of it is also on account of IBM price fixation for average selling price. Generally, as you know, IBM fixes the average selling price in the state, particularly in the state of Odisha, considering the average of the sale prices that have been declared or that have been transacted in the state of Odisha. This time what we observed is that in the month of July and August, when international iron ore prices were at a level up to $20-$30 per ton, and they are falling to as low as $85 per ton in the month of November. The IBM prices which are getting declared are not reflecting the fall in prices either internationally or in the domestic market where NMDC reduced the prices that is not getting reflected in the IBM prices, published prices. Initially when prices of September and October were declared by IBM, we noticed that there is a correction relative to August. After some time, they have republished the numbers for September and October, increasing the prices again substantially, almost similar to what was in August. Just to give you a number, 58%-60% FE iron ore, which was originally declared at INR 2,305 for the month of September, they revised to INR 4,095. There is almost INR 2,000 increase in the revised prices relative to what they have originally declared. When we were trying to understand why this revision has happened is that, due to exclusion of certain bona fide sales made by the company in the auction, e-auctions conducted. Those were excluded for the reasons best known to IBM. We have contested. The revision has happened subsequently in the month of January 2022. We have immediately made the provision by closing our books of accounts. This provision, the net impact, INR 1,056 crore in the quarter. That is almost 2,640 rupees per ton. When our EBITDA per ton came down by INR 5,950, if IBM prices correctly reflected what was there in the market, this fall in EBITDA would not have been there to the extent of 2,640. We have taken up this matter to the High Court of Odisha. Matter is subjudiced. One hearing has happened. Another hearing is expected in the next week. Considering this, provision and then EBITDA at INR 16,980 per ton, the EBITDA on a standalone basis is INR 6,797 crores. As far as subsidiaries and other joint venture companies are concerned, in the USA, plate and pipe mill and also the Ohio operations together, we have clocked an EBITDA of $55 million, which was lower than the Q2. Again, in the state of Texas, there is a tax on inventory. There is a tax on inventories that are there as on 31st December. Generally, sales would be lower or economic activity would be lower in the month of December. That also contributed for a lower sales and a lower EBITDA in the U.S. operations. In the current quarter, that is Q4 of the financial year, we expect this would improve. In the case of Italy, there is a EUR 7 million loss. Out of that, approximately EUR 6 million is one-off item. Because at the time before we took over, the area management was contemplating to set up an electric arc furnace, and they did some engineering and some expenditure. That's the expenditure we had written off. That is an amount close to around EUR 6 million, including another small item. This one-off item, if I take it out, the loss in Italy is only EUR 1 million. We feel in this quarter we should be able to do reasonably well even in Italy. The overall EBITDA from overseas operations was INR 340 crores in the Q3, as against INR 485 crores in the previous quarter. The Indian subsidiaries have done reasonably well. It recorded a total INR 769 crores of EBITDA from Indian subsidiaries other than Bhushan Power and Steel. I want to give you a separate number as far as Bhushan Power and Steel is concerned. It is INR 1,547 crores EBITDA, which has been recorded by Bhushan Power and Steel. Including 1,547, including Indian subsidiaries, other Indian subsidiaries EBITDA, plus overseas, minus consolidation adjustment all together, the subsidiaries have contributed INR 2,334 crores of rupees. With that, the consolidated EBITDA stood at INR 9,132.32 crores. It is INR 19,707 per ton. This is our consolidated EBITDA number. Our profit after tax was INR 4,516 crore. We also consolidated from 1st October 2021, Bhushan Power and Steel. With that, the total debt got added, net debt got added for INR 7,500 crore approximately. With that, the debt was INR 66,312 crore as on 31st December on a consolidated basis, including Bhushan Power and Steel. If I take out the debt of INR 7,500 crore of Bhushan Power and Steel, the balance debt on a comparative basis was INR 58,827 crore, which was higher when compared to 30th September 2021. We are almost close to INR 3,000 crore. Our inventories in the quarter went up by around 3 lakh tons, and also some debtors were to be collected. We have invested approximately around, again, INR 3,000 crores in the working capital. That's why this debt has gone up. Our effort in this quarter is to reduce these inventories and reduce this debt to this extent and bring it back to the levels which we have seen in 30th September. Debt to EBITDA on the face of it appears to be 1.73, but actually it is 1.53. Why I'm saying it is 1.53, when we take last 12 months trailing EBITDA, Bhushan Power and Steel, only one quarter EBITDA has come in the 12 months trailing EBITDA. That is October to December. Previous nine months EBITDA has not got reflected while calculating this 1.73. If we annualize the EBITDA of the October to December quarter of Bhushan Power and Steel, then this number will be 1.53. Debt to equity was 1.02. As regards to nine months performance, our consolidated production, crude steel production was 12.61. These numbers are without Bhushan Power and Steel. Our sales number was 11.215 million tons. If you have seen our guidance, we have given 18.5 million tons for crude steel production and 17.4 million ton for the sales. If I just break up this guidance we have given to existing operations and the expansion of Dolvi Project. In the existing operations, we're almost near to our guidance. We're at 97.5%-98%, both production and sales. In the case of expansion, because of the delay of commissioning of this project, instead of July, we could commission only in October and actual commercial production is from the 15th of November. There we have lost volumes of production and sales from the Dolvi expansion project. Now it is stabilized. We will have a good volume for the Q4, considering the loss of production from Dolvi expansion project and 1%-2% lower production from existing operations and sales from existing operations. Our overall guidance for the year will be around 94%-95% of the total guidance given for the year initially. Our Dolvi, as I mentioned to you, the expansion is more or less over and it is stabilized, excepting power plants which will get commissioned in this quarter. That will reduce again cost of production once commissioning is complete. Out of the total two power plants, one is getting commissioned in the month of February and the other one in the month of March. Then what is left out is the coke oven plant in Vizianagaram and the downstream units, like one galvanizing line at Vizianagaram, one color coating line at Vizianagaram, one can line at Vasind and one thin plate two at Tarapur. These are the downstream units which will also get commissioned before 30th of June 2022. This is briefly about the results. As regards to the overall performance, as far as Q4 is concerned, there will be a good volume growth which will happen from the expansion project at Dolvi. 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 their 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 Amit Dixit from Edelweiss. Please go ahead. Thanks for taking my question, sir, and congratulations for the numbers despite one-off related to iron ore and all. I have two questions. The first one is essentially on realization. How do we see blended realization changing QoQ, I mean from Q3 to Q4, and in particular our export mix from Q3 to Q4? The second question is on coking coal cost. What was it in Q3, and how is it expected to change in Q4? The coking coal prices, Amit, I think have been very volatile over the last few weeks. Coking coal prices, as you may be aware, have elevated to $430 FOB Australia, which was in the $357 range in the beginning of the month. It'll be difficult for us to quantify exactly what will be the quarter four outlook for coking coal the way usually we have given. I think we would, you know, we would need to wait and watch how the situation moves with respect to the coking coal FOB prices. Having said that, we have two months usually in the inventory cycle, so that's something which you could take into account while you factor your calculations. As far as NSR and realizations are concerned going forward, quarter on quarter I think, I would say that the prices in December have bottomed out. We have been able to settle the automotive prices. The quarterly prices for the January-March quarter also are by and large all done. Therefore, from an exit of December to January, I would say that by and large, the situation on a monthly price basis will be similar. However, there is an upside on account of automotive and quarterly. Going forward into February, March, the cost push which is happening across the world, both from coking coal, iron ore, zinc and other raw materials, would keep the prices supported. We see over the last one week the movement in the secondary market on the prices. They have moved up, and we see some reflection of that in the international prices as well. We do expect that there will be some movement on the prices on the positive side between February and March. Difficult to give an estimate as to what the quarter-on-quarter delta will be, but this is the direction where we are seeing ourselves in. Just a follow-up on this. What was the coking coal cost in Q3? It went up by $100 as we had estimated. It was $257 CFR. Okay, great. Thanks and all the best. Thank you. The next question is from the line of Sumangal Nevatia from Kotak Securities. Please go ahead. Yeah, thank you. Good evening, and thanks for the opportunity. First question, just a clarification. The iron ore one-off of INR 1,000 crore, if that's possible to break up between what was it with respect to September and October. That will help us to understand what was the one-off with respect to the previous quarter. Yes. Up to August, the prices were available when we closed our books in September. After that, when IBM revised the prices, they have revised only for September and October. The impact of September was INR 264 crores only in this total of INR 1,056 crores. Now, October prices were revised, so we have provided actually based on October IBM published price. Same trend we expect for November and December, because IBM will continue the same trend. We accordingly made the provision. At the same time we are contesting starting from September, that this is not the way ASP is to be calculated. We have to see finally how the matter will be decided by the courts. Understand. That's helpful. One clarification on the previous question that Amit had asked with respect to the prices. We understand exit December to exit Jan, as you said, is flattish. Is it possible to share what would be exit December prices versus the third quarter average prices? That could be difficult to give right now, but I think as I was telling in the last question, December and January are similar. International prices have seen an uptick. Recent bookings of international exports have been $30-$40 up. Secondary markets have moved up. We do see a positive upside possible for February and March. Understood. One last question, just on the subsidiaries. Italy after turning positive at EBITDA level this quarter we've again gone into a loss and also U.S. HRC prices are weakening. Is it possible to share what is our expectation going forward on a steady-state basis to international subsidiaries? No, the plate prices in fact have not fallen the way the HRC coil prices have fallen in the U.S. also. Therefore, we don't expect, as far as the plate mill is concerned, there will be a decline in the overall performance, either in terms of volume or in terms of EBITDA. At the same time, in Ohio, we are seeing a fall in the HRC coil prices, but the demand was weak in the last quarter. In this quarter we expect the demand to come back. If that comes back, our view as far as Ohio is concerned, it should continue to perform the way it is doing, if not improvement. Okay, sir. With respect to Italy? Italy, as I was mentioning in one of the calls last time, is basically the rail mill. If rail mill operates fully, then we will be in green. If rail mill there is an issue, then we will go into red. The rail mill operation is mainly dependent on the tenders by the Italian railways. If there is any delay in any quarter in awarding those contracts, then rail mill operates sub-optimally, so that will land in negative EBITDA. We expect in the Q4 it should come back. We are expecting rail mill should operate well and it will come back to green. We have already received one tender order from the Italian railways. While that is the first initial order level, part of that will get executed in this quarter. We are looking forward to another tender by the Italian railways during the quarter. Understood. Thank you, and all the best. Thank you. The next question is from the line of Indrajit from CLSA. Please go ahead. Hi. Thank you for the opportunity. A couple of questions. First, can you give us some color on the export markets right now? How are we seeing the export booking? Do we expect to go back to those 25%-30% of sales as export in this year as well versus what we have seen? On the export market, I think the overall quarter three exports to domestic ratio on consolidated basis without BPSL was 21% export, 79% domestic. The export market today post the December holidays and inventory liquidation stock drawdown, which has happened, the inquiries are far better post the holiday season. People have come into the market to buy. Therefore, in the last 2-3 weeks, the export bookings have seen a good movement upwards. Some of the products have moved better, like hot-rolled prices and hot-rolled volumes have moved much faster right now than the downstream. However, the downstream we do expect the movement to start as we go into the month of February. The export ratios, I think would be in a similar range between 20%-25% in the quarter four, as well. We are looking at the international market. The domestic market is definitely poised to be better. We see the automotive demand in December has improved over October, November. In January, it's improved beyond that. The outlook for quarter four from automotive is very good. The general infrastructure pickup and construction activity is also quite positive. We have seen some tender announcements and some execution of the projects which are now taking place for oil and gas and water pipelines, which will be again positive for servicing during the quarter and beyond into the next quarter as well. Appliances and solar continue to do very well. We are by and large looking at a positive domestic cycle in the quarter four. Therefore we will keep export as a balancing number, but the indicator could be between 20%-25% on an increased volume we have this quarter last year. Quarter four this year will be higher in terms of overall volume as well. Sure. Sir, again, coming back on the domestic volumes, do you think that the market has grown as much as, say, in FY 2023? Can we see a strong single-digit growth in the Indian market in terms of consumption as the market as a whole, not for JSW specifically? Do you think those levers are in place or do you think the market is still much weaker than what it was pre-COVID? Well, I think in general the investments across the physical infrastructure space, which we see especially from the government side, is quite positive. The entire CapEx cycle, the way we look at it today, is the industrial CapEx and the infrastructure CapEx. About 25% of the CapEx is coming from private CapEx. The balance 75% is coming from the government spending, mostly on infrastructure. The private CapEx is mostly on the industrial side. The CapEx pipeline looks good. The way we are seeing the oil and gas and water pipeline projects rolling out, the metro projects coming in, the high speed bullet train execution picking up, the expressway projects picking up, we are quite positive about the infrastructure and construction space, the way it is building up. The real estate launches by the real estate companies are fresh. Ongoing inventory liquidations are also quite positive. Construction activity is therefore picking up. Automotive, as we said, is picking up. Yes, I would say that if you look at GDP at 8.7% as indicated, and based on elasticity of 0.8 odd, we see a decent single-digit growth possibility in 2023-24. Sir, one last housekeeping question for me. For coking coal, if the benchmark prices are say $450, how much do we have any forward contracts in terms of any contracted amounts? Or, are actual purchase price much lower than the benchmark price, or it generally at some point in time reflects the benchmark? How does the pricing of cost for us look? The pricing is basically mostly index based, and it gets rolled up for the month, depending on the shipments for the month. However, you have your inventory cycle for about 60 days in the system between quantities within the country, port, plant, and whatever is on the sea. That's by and large the thing. The contractual prices separately, we don't have anything which is locked in at a particular price, no. just to clarify, the $257 CFR will turn to, say, $430 FOB at some point in the next few months, right? It is likely. $257 CFR levels translates to, let's say, roughly $305 level, let's say FOB level, roughly at about $240-$245 FOB levels. From there, $430 is only a peak of today. If you were to look at the average for January, that's the way the index will count. We'll have to see how the movement of the index is for the remaining seven days, and then take an average index number for January. No, no. I think one point I wanted to clarify. $430 doesn't mean $430 is the entire cost of coking coal we buy. We buy a proportion. It is generally 50%-55% is prime hard coking coal. Balance on the semi-hard, which is lower than the prime hard coking coal. On a weighted average basis, if you see what goes into the coke ovens, they are not at $430. Even if it should be $430 will continue. The relativity will be lower. Number one, we will get some discount to the index price, number one. Number two is the relativity of the mix that goes into the coke ovens to the index. That is also important. These are the two factors which we have to take into account. $430 minus $245 is not the cost to us. Sure. That is very helpful. Thank you. Thank you. Before we take the next question, a reminder to the participants, please limit your questions to two per participant. Should you have any follow-up, may we request you to rejoin the queue. The next question is from the line of Pinakin from JP Morgan. Please go ahead. Thank you. My first question is trying to basically put all the moving parts together. You highlighted that prices are broadly steady and possibly inch up. Coking coal, there is an inventory. Domestic iron ore prices would, you know, fall. If we take the starting point as INR 16,900 and that burden at this point of time in Q3, does the EBITDA per ton move higher or lower? Because obviously spot coking coal is higher, but you have two months of inventory. Here the issue is, it's very difficult for us to say EBITDA per ton will go up or down. There are so many moving parts, as you rightly said. Coking coal price, which we were seeing in the range of $330-$340, it moved up to $430 within no time. Even fall may happen to the same extent. We don't know what is going to happen. 60 days inventory when we have, so from today to the end of the month, whatever coal we will be buying, there is an extra cost that can come in, this quarter as far as the coking coal is concerned. Importantly, for iron ore prices are coming down, so hopefully it will continue in the following months. IBM or the courts will decide in our favor, thereby it gets revised downwards than what they have been declaring. At the same time, if I look at other than iron ore and coking coal, ferro alloys have corrected significantly downwards relative to what it was in the Q2. Q3, part of it has happened. Q4, balance will happen. We expect because of the supply chains from China, why again we are going back to China, is that majority of the raw inputs, other inputs, whether you take refractory, you take electrode, you take ferro alloys, the input that will come is again dependent on China. Chinese supply chains are getting streamlined. Their production is coming back. Therefore, there is a likelihood even other costs are likely to come down relative to what it was in the, in the Q3. The main point which you have to understand as far as JSW Steel is concerned, the Q4 there will be a big volume growth. This is coming from Dolvi expansion. The 180,000 tons is what has come from Dolvi expansion in the Q3. That will be much more than that. When we gave the guidance of 94%-95% of our sales target of 17.4 million tons of sales, what we achieved 11.215 for the nine months, then you can see the kind of growth in volumes that can come in the Q4. That will keep the absolute amount of EBITDA in a very healthy level, even though EBITDA per ton will fluctuate based on the various moving parts. Understood, sir. My second question relates to net debt. Now net debt moved very sharply higher. You highlighted that some of this is because of working capital, which should reverse as the company sells on inventory. Clearly the net debt has moved from the INR 50,000 crore handle, which was there for a long time, to the INR 60,000-INR 70,000 crore range. Now assuming that margins don't materially change, the company has the CapEx plan in place, should we expect net debt to broadly remain in the INR 60,000-INR 70,000 crore range for the next few quarters? Or do you think it can possibly even step up if there is an increase in CapEx? As far as the capital expenditure which we have incurred in the nine months is INR 10,350 crore. Even after incurring that CapEx, if you really see the net debt number, excluding Bhushan Power and Steel, Bhushan Power and Steel have INR 7,500 crore debt. If I look at the EBITDA of that particular company, it can easily be serviceable out of the cash flow of Bhushan Power and Steel. If I exclude the Bhushan Power and Steel and look at the consolidated JSW Steel without BPSL number, that is INR 58,800 crore. Now, let us look at this number compared with March 31, 2021 number, which is INR 52,600 crore. Actual increase is around INR 6,200 crore. The INR 6,200 crore debt increase, if I look at the two numbers, which is after spending INR 10,350 crore on the CapEx. Over and above that, the investment in the working capital in this year is INR 11,097 crore. I talked about only 3 lakh ton in increase in inventory in this quarter. If I look at overall inventory as on 31st March 2021 versus 31st December 2021, there is a significant increase in the overall inventory. We have to bring down inventory not by 3 lakh, maybe another 2 lakh ton, plus the debtors have to come down. Whatever we have invested in the working capital, once this come back, we will go back to the level where we have seen as on 31st March 2021. The number which is more important here, the kind of investments which have gone in the working capital because of the extended working capital cycle, either in terms of increase in inventory or increase in debtors. Understood. Thank you very much, sir, for the clarification. Thank you. The next question is from the line of Satyadeep Jain from Ambit Capital. Please go ahead. Hi. Thank you for the opportunity. Just one question. Maybe one related to iron ore. If I understand it correctly, when the IBM prices were calculated initially, the company's e-auction volumes were included in the initial calculation, and subsequently, in the subsequent calculation, those e-auction volumes were excluded. If that understanding is correct, is it possible to quantify how much were these e-auction volumes? And were they at substantially basically lower prices than the spot prices at that time? The company has conducted total 11 volumes. There were 50 bidders. 57 bidders were the successful bidders. Out of that, three are related parties. Balance all third party. Total volume which has been auctioned was 2.65 million tons. Out of that, 1.9 million tons is unrelated. Now this entire auction quantity exclusion is not in line with the provisions of MCDR Rules 2017. That is what we are contesting. This is making a difference of 2,000 INR approximately per ton in the declared prices, revised prices. Okay. Thank you, sir. Thank you. The next question is from the line of Ritesh Shah from Investec. Please go ahead. Yeah. Hi, sir. Thanks for the opportunity. Sir, I just want to take the prior question forward. Sir, you indicated 2.6 million tons, of which 1.9 million tons was unrelated. Did I hear it right, sir? Right. Would it be possible for you to quantify what was the pricing differential between related and unrelated transactions on a volume-weighted basis? When you auction, you can't distinguish between related and unrelated. Anybody can participate in that. The price will be the same in the auction, or it could vary very marginally from A2 B or B2 C. It can't be the significantly different. Correct. The reason I ask is basically you indicated INR 2,640. That number is pretty huge. That was the reason I asked that. Sir, a related question. Ministry of Mines has indicated basically National Mineral Index and District Mineral Index. To what my limited understanding is, the incremental premiums will still be paid on National Mineral Index. However, there is an element of quantities of grades which needs to be prefixed when we arrive at a particular index. Sir, where is this process at? Given what has happened in the last quarter, how should one understand this particular variable actually flowing incrementally? Because it's quite pertinent from a P&L standpoint. There are a lot of distortions in the way the average selling price is calculated in the current provision. This has been brought to the attention of the government. The government has appointed a committee. This committee has met all the stakeholders how to fix the average selling price, even if it finally goes to National Mineral Index. They have their recommendations, and the recommendations are getting submitted, I understand, to the government. Hopefully something will come or clarity will come. How it gets fixed in a transparent manner is going forward. Sure, sir. My second question is for Jayant, sir. Sir, how are you looking at Chinese net steel export trends going forward? Any color on Chinese infra, stimulus, or how are you approaching the local demand supply situation in China? Just trying to get a sense on how we are looking at Chinese export numbers and the underlying economics. Thank you. Chinese production is likely to be moderated during the next few months on the Winter Olympics and the winter month. They want to control the carbon emissions. Certain regions are controlling the production more than others. That will result in a lower export or in more moderate exports from China during this period. The other thing is that the Chinese economy now, I think is looking, the government is looking at stimulating it. We have seen print to say that the, you know, the rates have been, the interest rates have been reduced. There is some more liquidity being pumped in. The support to the real estate market is likely to be given. We are seeing some positive vibes from the government to stimulate the economy going forward. I think that's a positive. We think that Chinese domestic demand will be reasonably okay, and exports will continue to be moderate, at least for the first half of this year. That's helpful. Thank you so much. I'll join back with you. Thank you. Thank you. The next question is from the line of Abhijit Mitra from ICICI Securities. Please go ahead. Yeah, thanks for taking my question. I have two questions. Firstly, regarding the JSW Coated, the EBITDA movement, the sharp decline, how do you explain it? Is it because you have taken the CR price cuts but yet to sort of take any action or decision on the HR prices? That's question number one. The second question is, you know, how to sort of bridge conceptually the EBITDA per ton that we are seeing on the standalone and Bhushan, because standalone EBITDA is around INR 17,000 per ton. Bhushan EBITDA is around INR 26,000 per ton. How to sort of bridge these two? Thanks. These are the two questions I have. On JSW Coated, the numbers have been little lower this time because of the cost impact on certain raw materials like zinc, aluminum, tin and paint. That has led to a moderation in the EBITDA numbers. We are watching that space. There is a raw material pressure. HR prices to some extent have moderated in an exit number from December. The situation for the quarter four should be better. In the case of Bhushan. Yeah, sorry. Yes. Yeah. Just a follow-up on that. I mean, the spread between CR and HR, is there anything to do with that, was what I was trying to understand. Because we understand that you would sort of supply the, you know, steel from JSW and get it converted out there. Because realizations are also down significantly, not only the costs. Yeah, if you can just briefly tell us on that. Let's see. The HR and CR trade, you were saying. I didn't understand that part. The question, can you just repeat the question? HR and CR, what did you- The spread between HR and CR. The compression in spreads between HR and CR prices, the compression of the gap between HR and CR prices, does that play into the spread, that gap between JSW Coated? Coated? Yeah. Okay. No, the HR and CR, the compression in HR and CR gap has moderated. That is primarily in the CRCA retail space, which you see. In coated, I think different products are behaving differently. If you look at tin prices are probably one of the best, and we see a strong you know price support on tin going forward. The demand is also quite good. On the coated OEM space, if you look at solar, if you look at appliances which take specialized galvanized and specialized GL, there also we are seeing a decent demand and therefore the prices there are also holding up. These are high-strength steels and therefore not available from everybody. On the color coated space, while the prices have moved down, but in certain brands of color, like Colouron Plus, where we continue to have an edge, we see the price drop has been lower than the other level of color seen from competition. There is a pressure in coated on commodity galvanized. Commodity galvanized in coated has, let's say, come down more than, especially in the retail and the pipe and tube segment. That area is putting some pressure in the market. Going in the last one or two weeks, as we were seeing in general commentary, the prices have improved, including the retail space of galvanized. If I can clarify on the second question which you asked, as far as BPSL EBITDA versus JSW Steel, I think you have to look at Bhushan Power and Steel. They have surplus capacity in the blast furnace, so they also sell pig iron. If you look at their EBITDA, it includes the sale of other material other than the finished steel. So that adjustment requires to be made. Number two is, if they are producing, let us say, 200,000 tons per month of HR coil, what they sell in the form of HR is only 30,000. That means around 15%. Balance 85% is in the form of value added. Whereas when you calculate JSW Steel's standalone EBITDA per ton, that is not comparable actually with Bhushan Power and Steel, because entire value addition is not getting reflected in the standalone EBITDA of JSW Steel. This is the second. The third point is, when Bhushan Power and Steel participated in the auctions, when they got the iron ore, they got it at a lower price. Whereas that cost is booked in the JSW Steel. That difference. These are three differences if you adjust. I think EBITDA per ton on the both the companies are comparable. Okay, great. Thanks. That's all from my side. Thank you. The next question is from the line of Nitij Mangal from Jefferies. Please go ahead. Hi, good evening. Thanks for taking my questions. Firstly, for FY 2023, what kind of incremental volumes are we expecting from Dolvi expansion, please? I think we will tell you clearly the exact number in May, but the ramp-up is quite good. Now it is stabilized. The unit is working very well. The numbers we will give you when we meet in May. Okay, sure. Thanks. Secondly, on this iron ore issue, is there any ambiguity on November-December pricing as well? If it's possible to share, I mean, what's IBM's rationale for that change in the reference price? Thank you. I don't want to get into too many details, what is the issue which is there on the table. The way the methodology which is being adopted by IBM for calculating the average selling price in Orissa is not in accordance with what IBM follows in Karnataka. Both are different. In Karnataka, all the iron ore is auctioned. The way the average selling price in Karnataka is calculated is not the same methodology which is done in Orissa. Therefore, there are discrepancies. These discrepancies are brought to the attention of IBM and also to the Honorable Court of Orissa, High Court of Orissa. I think, the matter will get resolved, in the due course of time. Okay, thank you very much. Thank you. The next question is from the line of Bhavin Chheda from ENAM Holdings. Please go ahead. Yeah, good evening, sir. Two questions. One, what was the CapEx and revenue CapEx figure in the quarter? The second one was, what was your captive iron ore volume? If you can break that into Karnataka volume and Orissa volume. See, the self-sufficiency of captive iron ore in the last quarter was 47% on the increased volume. I don't have the breakup right now between Karnataka and Dangoli or Orissa. The CapEx which you asked for, raw material, was INR 1,486, because coking coal prices have gone up. The CapEx in the raw material side went up to INR 1,486. But at the same time, CapEx, we have brought it down. It is INR 174 million. Total INR 1,660. INR 74 million. Okay. Mm-hmm. Sir, a clarification on this Bhushan Power EBITDA per ton, what you explained is substantially higher. Because obviously the NSR also looks higher because obviously the pig iron and the other sales number which got captured in the sales divided by the actual finished steel volume. Which means you are indicating this spread is a sustainable number over JSW, and there is no one-off there? There is no one-off excepting the iron ore pricing what happened. What iron ore pricing, sir? I didn't get that. I know I explained to you about IBM's fixation of iron ore. Yes. No. That's fine. That is captured in standalone. I was looking at JSW Bhushan Power EBITDA per ton, which comes to roughly INR 26,600 this quarter. Even last quarter was INR 26,600. In fact, has remained steady for last two quarters despite cost going up in this quarter. Was trying to figure out if there was some one-off in that numbers. There's no one-off item. Okay. Thank you, sir. Thank you. The next question is from the line of Kamlesh Bagmar from Prabhudas Lilladher. Please go ahead. Yes, sir. Thanks for the opportunity. Sir, just on this, iron ore cost or this charge which we have took in this quarter. If I see the data right from October, November, December based on Odisha Minerals data, which is a published one. Every time like, say, our, like, say, realizations of which we have published there or reported there are lower by roughly around INR 2,000, even for the December month. If you see all other like, say, around 20-25 odd miners which they have OMC or Essel Mining, this difference is there across the miner. How we are going to substantiate on that particular item like that our realizations are lower by roughly around INR 2,200 on that count? Because they are also selling the mineral for the last, like, say, or around 20-25 years. Their prices, like, say for 25-odd miners against us. How would we be able to establish that particular argument? We have been operating the mine since June to July 2020. Now we are in December 2021. Up to August 2021, we have not raised any issue. In September 2021 onwards, there is a problem. Because we need the auction. When we auction, I need not prove anything. It is a bidding on the MSTC platform, e-auction platform. Even OMC does auction on the MSTC platform. Karnataka does auction on the MSTC platform. When we do the auction, the next bidder has participated. You know the price, you know the quality. There's nothing here to prove to anybody. We know the grade, we know the price, we know the bidder, we know the seller. We know the mine from which it is going. Therefore, it's quite transparent. The way they're interpreting, the way we understood is different, particularly in the later months when the prices have fallen. That's why we say there is an issue which we took up very strongly, not only legally, but also to the government. I appreciate that, sir. Sir, lastly, on this, PLI, like say we are doing massive investment in the downstream. How much of our quantity in downstream or upcoming capacity, because it would be applicable on the expansion, would be covered under the PLI? PLI scheme, just now they have announced the guidelines. We are studying those guidelines and we are working out based on those guidelines, how much capacity can come in. Because there are certain timeline by which the production has to start or the expenditure has to come in. Those things which we are calculating, I think next time when we meet in May, we'll be able to throw light on that. Lastly, sir, we have mentioned that we have two months of coking coal inventory. Assuming that these current prices continue or $10-$15 here and there, what increase or what change can we expect for the Q4 in terms of coking coal prices? The way, in fact, we worked out, we wanted to give you a number in fact. We worked out the numbers based on the price prevailing up to 31st December. When we calculate that number, assuming that that would continue, it would be in the range of around $25 per ton. Well, after that the prices went up. Therefore we have to now recalculate. Because the January month, whatever buying that is happening, part of the quantity will come in consumption in the month of March. Okay. Therefore, that number we don't know. Minimum 25. After that we have to calculate the number and then share. Okay. Great, sir. Thanks a lot, sir, and wish you all the best. Thank you. Next question is from the line of Vishal Singh from PhillipCapital. Please go ahead. Vishal Singh, your line is in talk mode. Kindly go ahead with your question, please. Good evening, sir. Yeah. Sir, just wanted to understand what is our landed cost at January from our captive mine versus the bought out iron ore. If you can tell us the difference and which one is higher at this point of time. Sir, that is very difficult to tell you the number here. Iron ore, there are different grades. As far as our mines are concerned, it is low grade. We get the low grade, beneficiate it and then use it. This is not directly comparable. Therefore it is not proper to give you a number. Understood. Sir, secondly, in terms of Bhushan Power and Steel, just wanted to understand, have we checked whether we have the spare capacity addition potential? Because what we have heard that the capacity could be taken to 3.5-4 million tons. Anything you would like to share about by when you would like to start working there? Or what is our thought process in terms of utilizing that capacity going forward? Last time, I think we have already mentioned that there is a total CapEx of INR 3,500 crore which is committed in Bhushan Power & Steel, which is currently going on. Out of this INR 3,500 crore, INR 1,500 crore are improvement in various areas to reduce the cost saving initiatives, including the PCI injection and also coke oven plant, which is not fully commissioned. Those are the areas where we are spending money to improve the operational efficiency of BPSL that will reduce the cost further. The second amount of CapEx is relating to INR 2,000 crore to increase the capacity from 2.7 to 3.5. That gets completed in the next financial year. We expect at least by September 30th, we should be able to complete this project. Thank you, sir. Thank you. That's all from my side. Thank you. The next question is from the line of Prashanth Kota from Dolat Capital. Please go ahead. Sir, thanks for the opportunity. Sir, I have two questions. The first one is on the coking coal side. Sir, right now the FOB price for the low vol prime grade is $430. Let's say we use a blend of prime grade, then a mid vol and, let's say the second tier. Even then, if you see, the FOB basket, if you see 50%-60% prime, 20/20, the rest too, still the price will be around $380 FOB, and CFR will be $410. Sir, and as a country also, if we see now, we have been one of the largest importers of coking coal in, probably, in the world. This is not just an issue for JSW, and probably it's a national issue also, sir. The price behavior of coking coal, if we see, it's like oligopoly kind of a behavior. Not now, since 10, 12, 13, 14 years we are seeing. There is 15 days of rainfall and for six months prices remain elevated. There's various times, various instances, it hits very substantial spikes, etc. Sir, is there any way we can renegotiate as a country and carve out something as in the coking coal price should be a percentage of the steel price, not a Platts index, which is quite illiquid. Sometimes we don't know what exactly is going on behind there. It's quite, you know, it's not that scientific, maybe. So maybe it should be. Today rebar price is $725 in India, and coking coal is $450 CFR. 65%, sir, just one commodity. They need us as much as we need them. Coking coal, there are no other use. It's a symbiotic relationship, but somehow there appears to be a lot of arm twisting. I don't know what is the solution for this. If we have to form a syndicate as a country and do something, or what is the solution, sir? Just wanted to know your thoughts. We appreciate your anguish in this, and we are also equally anguished on this issue. But if, for instance, in the case of oil, OPEC, what the entire world is able to do? They dictate how the supply is to be done, what should be the price. Nothing could be done. Same story in coking coal, same story in iron ore. Very few players are there. They dictate what could be the price, how we should operate. The point remains, how India is a country where we have large ambition to become a 300 million ton steel in the country by 2030, where our coking coal requirements will continue to go up from current levels. How we can become self-sufficient with regard to coking coal? Here, as a company, we have given a proposal to the government, which we are really pursuing very, very vigorously on that. There is enough coking coal that is available within India. How to develop, taking into account all the stakeholders. One is the state government, where the mines are located, another is central government, another is steel industry. The third one is the people who are affected due to mining. These four constituents have to have mutual trust and then work together to see that this problem can be structurally addressed. We are on it. Hopefully, something should happen. Okay, sir. Got it. Just next question. Sorry for the follow-up on that. Sir, just because of elimination of our company's auction bids, the IBM prices have been revised, or is there anything else that they've eliminated? Only just one, because we have 25 sellers. Only one seller's prices they have not considered, hence it has been revised upwards? Or how does it, how is it, sir? We also don't know how originally they calculated, how revised price has been calculated. The point is that when revision has happened, then we understood that we learnt that there is some exclusions happened. We took it up, that issue, with them, and then followed by a litigation in the court. What is that they have taken into account? What is that they have not taken into account? We don't know. Ours is excluded because they have issued a notice to us to give the details of the quantities sold in the auction and whom we have sold. All those details have been provided to them. Thereafter, price is revised. Therefore, we feel that ours is excluded, then we took it. Okay, sir. Understood. Thank you. Thank you. Ladies and gentlemen, due to time constraint, we take that as the last question. I now hand the conference over to management for their closing comments. Over to you. Yeah. Thanks, operator, and thanks everyone for joining us. Feel free to reach out to us if you have any follow-up questions. Good evening. Thank you. Ladies and gentlemen, on behalf of JSW Steel, that concludes this conference. We thank you all for joining us, and you may now disconnect your lines.