Ladies and gentlemen, good day and welcome to the PCBL Limited Q4 FY25 earnings conference call hosted by ICICI 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 touch-tone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Sanjesh Jain. Thank you, and over to you, sir. Thanks, Avira. Good afternoon, everyone. Thank you for joining on for PCBL Limited Q4 FY25 results conference call. We have PCBL management on the call, represented by Mr. Kaushik Roy, Managing Director, Mr. Raj Gupta, Chief Financial Officer, Mr. Anand Kumar, Group Head, Investor Relations, Mr. Pankaj Kedia, Vice President, Investor Relations. I will request Kaushik sir to open the call with his initial remark, post which we will have a Q&A session. Over to you, sir. Thank you so much. Very good evening to all of you. I would like to extend a very warm welcome to each one of you for joining this call today to discuss Q4 and FY25 of PCBL Limited. I hope you have already gone through the investor presentation and the financial results, which we have already uploaded on the stock exchange. And I'm honestly thankful to all of you for taking your time to join us today in this call. Now, coming to this year and this quarter, last quarter, I'm happy to inform that as a whole, in the whole year, PCBL has reported its best-ever operational performance and highest-ever EBITDA, highest-ever carbon black sales, as well as specialty black sales. And in addition to that, power sales volume was also the highest in the history of PCBL. The other milestone which we have achieved is, we have achieved in FY25, a revenue of $1 billion plus. As you all know, over the last few years, we have diversified beyond carbon chemistry into new fields within the chemical sector, and this growth, both organic and through strategic acquisition and partnership, has brought us a pivotal moment. We have broadened our capabilities to pioneer advanced solutions for our customers globally. Our quest to diversify from a pure-play carbon black producer led to the acquisition of Aquapharm, which you are fully aware of, in early 2024. As you know, Aquapharm is a leading specialty chemicals player focusing on water treatment, detergent, and oil and gas chemicals. This particular acquisition provided us access to an export-oriented specialty chemical platform, and FY25 was the first full year of operation for Aquapharm post-integration. FY25 was a bit challenging year for Aquapharm. The business environment was not really so strong. There were also sharp. Yeah. Can you hear me? Hello? Am I audible? Yes, sir, you're audible. Okay. As I said, as I was saying, FY25 was a bit challenging year for Aquapharm. The business scenario, the business environment was weak. There were some corrections in the yellow phosphorus prices, resulting in a soft performance. Phosphonates is a huge opportunity given Aquapharm's global leadership position. Raw material prices for phosphonates have now stabilized, which would be beneficial for us going forward. We have strengthened management capabilities. There were some gaps in that area and created a revamped organizational structure in Aquapharm now. We expect a very strong improvement in both operational and financial performance in Aquapharm in this financial year, which is FY26. The steps taken to improve cost and operational efficiency measures, value-added product launches, and strengthening of sales from sales teams in the USA and Europe have set a strong foundation for the next leg of growth in Aquapharm in coming years. In oil and gas chemicals, Aquapharm has less than 1% of global share, and we are working on strategies to increase our customer base presence in multiple geographies, increasing capacity and supply chain capabilities. In the United States, oil and gas chemical opportunity is large, considering Mr. Trump's new policies focusing more on increased oil production. Keeping all these things in mind, we have also gone ahead with expansion projects which are on track and nearing commissioning. This would help us to accelerate the sales volume growth in coming years. We are also evaluating greenfield CapEx across all manufacturing locations in India as well as in the USA. Within Aquapharm, green chelates is another segment where we see strong growth opportunity with push towards biodegradable chelating agents in the USA and Europe, as well as in China and India. We are, therefore, working on expanding the portfolio of green chelates by using our R&D capability. We have already developed MGDA and GLDA liquid and are now working on MGDA granules. Now, coming to PCBL on the carbon black side, we are in the process to acquire 116 acres of land in Naidupeta, Andhra Pradesh, for our sixth manufacturing unit. This new facility will primarily focus on rubber black as well as performance and specialty chemicals. This land can eventually accommodate 450,000 metric tons per annum of additional capacity. CapEx at this site is expected to commence in a year's time, and construction to take 18 months thereafter. The proposed greenfield plant under PCBL Tamil Nadu has significant tax advantage as earnings would be subject to a lower tax rate of 17.2%. We are also participating in a fast-growing battery chemicals market through NanoWave Technologies. We intend to manufacture nanosilicon, which is to be used in anodes of lithium-ion batteries. It brings significant benefits like extended battery range, longer battery life, faster charging, and reduction in CO2 emission. At the same time, it is cost-effective. The pilot plant currently is under construction in our Palej plant and should be ready in the next few months' time. PCBL has also signed a technology transfer agreement with a Chinese company for acetylene black capacity, which finds application in high-voltage cables, batteries, semiconductors, packaging, conductive plastics, paints, and coatings. Global demand for this product, acetylene black, is approximately 70,000 tons or 70 KT, with 90% of supply coming from China. We plan to set up an initial capacity of 5,000 metric tons per annum by FY27 and at Mundra. We are witnessing strong interest from across value chain partners for this. FY25 was the first full-year operation for our new greenfield CB facility of 147,000 metric tons per annum in Tamil Nadu. We have already announced greenfield expansion of 90,000 metric tons in two phases in Chennai, Tamil Nadu. First phase, 30,000 metric tons, will be commissioned in the next few weeks' time, and the second phase of 60,000 metric tons along with 12 megawatts green power by FY26 end. We aim to cross 1 million tons capacity in carbon black by FY28. PCBL anticipates continuous growth in the international market over the next few years, driven by expansion into new geographies, strategic investments in supply chain capabilities, moving up the value chain, and the launch of new specialty grades. The capacity growth in the EU and U.S. has been stagnant, and Russian CB is banned by the European Union. In the process, PCBL is gaining market share in both the EU and U.S. Their industry growth outlook, both in India as well as at global industry level, continues to remain positive. With EV penetration rising across two-wheelers and passenger vehicles, we expect replacement demand to remain steady and positive. The demand for specialty-grade carbon black continues to be resilient. Since FY17-18, PCBL has increased its focus on developing grades which can be used in these products, leading to a corresponding increase in margins. Significant increase in share of specialty black volume from 1% in FY15 to 11% in FY25. PCBL added 20,000 metric tons per annum specialty black capacity in Mundra in FY25, taking the total specialty black capacity to 112,000 metric tons per annum. We also plan to set up a 1,000 metric tons per annum specialty black capacity dedicated for superconductive grades where margins are obviously extremely high and is expected to be completed by the end of FY26. Over the last few years, the company deepened its research commitment, comprising forward-looking investment in infrastructure, people, and process, resulting in empowerment of the company with proven capabilities in product application, process efficiency, and product customization. Now, I'll come to quarterly performance of PCBL Limited. But before that, just to give you a flavor of how we are looking at the business and what is the philosophy of the company, broadly, if you look at PCBL, it has got three major baskets or verticals of business. One is relating to rubber black. The second one is relating to specialty black, specialty chemical, along with new initiatives. And the third one is Aquapharm, which is beyond carbon chemistry. When we talk about the rubber black, which is our foundation today, we started with rubber black in a big way, and we are a leader in India, and we continue to grow globally. The growth journey continues, and therefore, as you know, we have already added a fifth plant in Chennai, and we are working on the sixth plant in Andhra Pradesh. The focus will remain there. We'll keep growing in that area, both in India as well as globally. Let me come to the second bucket where we are talking about specialty black, where the journey started in 2015 or 2014, and today we have reached the position of fourth-largest player globally. Along with specialty, we have also started focusing on things like NanoWave, which you are aware of, nanosilicon technology, acetylene black, just now I talked about. We are looking at superconductive, which will be commissioned very soon, so this is another bucket. This is another big bucket for us. The third one is about Aquapharm. Yes, it was the first year of operation, last financial year, and we moved from a promoter-driven organization to a professionally managed organization, so it was important to create the right kind of foundation, and we have taken all those actions to ensure the organization structure is in place, proper structure is in place, and it will eventually reflect in the performance. We are very confident that in this financial year, we'll be seeing substantial improvement in Aquapharm performance also. The focus remains on all the three verticals: rubber black-related specialty plus new initiatives driven by R&D and innovation. The third one is about Aquapharm, which is phosphorus-based chemistry, moving away from carbon chemistry. Let me now talk about the quarterly performance. During the quarter, our consolidated sales volume in carbon black business increased by over 5.3% year-on-year to 150,152 tons. This translates into a capacity utilization of over 95% during the quarter. Consolidated revenue from operations increased by 8.2% to INR 2,087 crore on the back of higher sales volume and revenue from Aquapharm Chemicals. Consolidated EBITDA reduced by around 4.5% year-on-year to INR 317 crore. PBT stood at INR 126 crore, while PAT stood at INR 100 crore. EBITDA per metric ton in carbon black business stood at INR 17,655. Of the total carbon black sales volume, domestic sales volume stood at 86,737 tons, while international sales volume stood at 63,415 tons. Export sales volume registered a strong year-on-year growth of 16.8% in Q4 FY25. Moving on to our segmental performance, Tire accounted for 90,080 tons. Performance chemical reported sales volume of 44,700 tons, while specialty sales volume was 15,372 tons. We continue to expand our product portfolio and customer base across all segments. Aquapharm Chemicals reported a steady performance during the quarter. Q4 FY25 revenue stood at 372 crores with an EBITDA of INR 51 crore. The quarterly sales volume stood at 24,098 metric tons. Coming to the yearly performance, consolidated revenue from operations increased by over 30.9% year-on-year to INR 8,404 crore from INR 6,420 crore in FY24. Sales volume increased by around 12.1% year-on-year to 596,262 metric tons in FY25. The consolidated EBITDA for FY25 was up by 28.8% year-on-year to INR 1,384 crore from INR 1,074 crore in the previous year. During this time, we also achieved the highest-ever power generation and sales volume during the year. Power generation increased by 10% from 671 million units in FY24 to 738 million units during the year, with an external sales volume growing by about 7% to 436 million units, as against 408 million units in FY24. Aquapharm reported revenue of INR 1,420 crore and EBITDA of INR 193 crore in FY25. Now, turning to the macro environment, we are assessing the current development in the U.S. As such, the economies are not really doing too great. As all of you know, the U.S. is not showing great signs of improvement in the economy. Europe is going almost flat. China is also a little bit down. India is the brightest spot at this point of time. So that's good news for all of us. But at the same time, certain amounts of uncertainties have got generated recently because of the tariff issue which got created recently. We are watching out for the situation. We have a belief that possibly once the dust settles down a bit, things are sorted out, India might be having an advantage over others, and hopefully that will reflect on our company as well. India's specialty chemical manufacturers may gain some share in the USA because of this tariff issue. We are not sure about the basic carbon black, the rubber black, whether that opportunity is there or not. But specialty, for sure, there's an opportunity. We might also see some benefit coming to Aquapharm's way as we go along. Currently, the carbon black exposure to the U.S. market is about 5% for PCBL. CB exports to the USA would be exempted from tariff for the portion of raw material which is procured from the U.S., which is approximately 75%. At PCBL Chemical, we continue to work on portfolio expansion and capacity additions across all business verticals and increasing allocation of resources towards strengthening our supply chain, improving the product mix, and optimization of costs. The long-term prospects of all the business segments remain positive, and we are on track to achieve our mid and long-term growth targets. All these achievements underscore our strong position within the industry and highlight the progress we have made in the global specialty chemical space. PCBL has successfully set a strong foundation for its growth journey upwards, and with this, I would like to conclude, and the floor is open for your questions, please. Thank you so much. Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press 4 and 1 on the touch-tone telephone. If you wish to remove yourself from the question queue, you may press 4 and 2. 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 Aditya Khetan from SMIFS Institutional Equities. Please go ahead. Yeah, thank you, sir, for the opportunity and for the detailed understanding on the business. Sir, my first question is onto the outlook for the carbon black. I believe, sir, in the domestic market in FY26, like most of the auto OEMs have guided for a muted set of growth. Even in the tire segment also, the growth would be largely in the lower single digit. So demand seems to be muted for carbon black in domestic. In times of this muted demand, are we able to compensate the loss in volumes in domestic in the export market? And how the trend in spreads generally takes up when the demand is muted? Any thoughts on this, sir? Yeah, I mean, you are right. In a way, Indian demand at this point of time for auto and tire is naturally not very strong, as you rightly said. And therefore, the carbon black demand in India will not be very strong, though there is a decent amount of demand will be there. And what is our plan that while maintaining the leadership position in India, we will be focusing more on the international market? And our presence, as you will see going forward, will grow further. Just to give an example, about 10 years back, our international sale was around 80,000 tons in a year. And already last year, we have crossed 240,000 tons. Last year, we have already crossed. So we'll keep focusing on the international market and keep growing further in the international market. You are absolutely right. While India might be a little soft at this point of time, but we'll be growing more in the international market. Got it. Sir, onto the international markets, it is rightly understandable that India and the U.S., these are the two markets where we would be witnessing volume growth. Sir, in terms of number, if you can put, although we note that the ban by Europe on Russia has led to a supply glut of almost around 6 lakh-7 lakh tons of carbon black volume, how much of that is compensated by China and India? And what is the wallet share like if you can highlight by Indian players, especially for PCBL, how much we have reached with penetration and how much more room is there, sir? Yeah, you were right. In Asia, naturally, our wallet share is quite high. But when you look at Europe and the USA, our wallet share is in single digit. And therefore, the headroom is quite large for us. And we see that as an opportunity to grow both in the EU and the U.S. And to be honest, we are putting up capacity. That is the primary reason. 90,000 tons we are adding in this year in Tamil Nadu. And again, in parallel, almost, we are initiating the project activities under a plant. So keeping that in mind, we are going ahead. Got it. Sir, onto the Aquapharm, this quarter, definitely, there was a good upturn in terms of volumes and per kilo realizations. Any sort of change which has happened compared to last quarter? And we could see this trend to be materially on the higher side. Any sort of a demand uptick in international markets for phosphonates? Anything has changed if you can highlight that? Yeah, sure. I think I mentioned that there's a lot of opportunity for Aquapharm to grow in the field of oil and gas chemical industry, which is a very large one. And our share is just about a couple of percent. So there is a huge amount of growth opportunity there. A huge amount of headroom is there. It is a question of penetrating the market, penetrating the customer, and expanding the geography, and making the right set of products which is technically rich. And precisely, that is what we are doing. We had issues in terms of lack of skill, lack of leadership, which now we have corrected. And therefore, we have already started seeing in the last quarter, there is improvement. And going forward, we'll be seeing further improvement in the case of Aquapharm operation. There is also a lot of focus on cost management, better cost management, more efficiency in procurement, and all other functions as well. On one side, we are focusing on sales, closely working with customers, expanding geographies, expanding product portfolio. On the other side, we are focusing on operation to improve on cost. So the combination of these two has reflected already in the last quarter. Going forward, it will be even more prominent. Got it. And sir, the guidance of 15%-20% volume growth in Aquapharm, that will be maintained? And sir, secondly, in FY25, the EBITDA was INR 194 crore for Aquapharm. Does this include the other income also? Yeah, it does. Okay. So sir, how much would be that in this INR 194 crore EBITDA? Other income was INR 11 crore. Okay. Sir, for full fiscal FY25? Yeah. Okay. Okay. Sir, just one outlook on the debt side. Sir, this quarter, we had witnessed some decline in the finance cost. I believe, sir, we were also doing a CapEx of around INR 5,000-6,000 crores. And the cash flow which we would be generating largely would be used for that expansion going ahead. Alongside, sir, are we also focusing on reducing the debt? If yes, sir, what is the guidance for debt in FY26 and 27? Absolute debt level may not go down significantly from the current level unless crude goes down from here. We would be generating good cash flow, but we also have CapEx pipeline. Not 5,000-6,000 crore, but next five years, we'll be spending around 3,500 crore. So on an average, about 700 crore every year will be the CapEx run rate. And consequently, absolute debt may not go down significantly from the current level. Interest rates have started cooling off, and a small reflection of which is there in our quarter four finance cost. We believe that next year, with more interest rate cuts expected, our interest cost should go down. Got it. Sir, just one last question. Onto the carbon black side. Mr. Aditya, we may request that you return to the question queue for follow-up questions, as there are several participants waiting for their turn. Okay. Yeah. Thank you. The next question is from the line of Angad Saluja from UBS Securities India. Please go ahead. Yeah. Hi, sir. Thank you for taking my question. The first one on realizations for the carbon black business for the quarter. I think we've seen a decline now for two consecutive quarters in realizations. And obviously, now with crude also being slightly volatile in the last one-odd month, how do you see the realization shaping up for the next quarter and the year ahead? What's your outlook on realization specifically? So this quarter, realization should be mostly flat. A small uptick, small improvement, because there is a quarter lag between the movement in crude prices and change in our realization. So first quarter, we would see very marginal improvement in realization. But then realization should not be seen as a reflection of change in margins. It is more reflective of the movement in raw material prices, which is linked to crude. But margin would depend on product portfolio and also demand-supply situation, broader demand-supply situation in the industry. Got it. Got it. And sir, just going back to that, you said product mix will drive more margins. I think in the quarter, we've seen that despite specialty black sort of doing better, I think almost 9% YOY growth overall in the full year as well, our margins for Q4 have sort of dipped QOQ as well as YOY. So any specific reason, any one-offs or anything that we should know about? Specialty still is about 10% of our total volume, right? While year-on-year, specialty volumes are going up in terms of percentage, its weight on the overall sales volume is still very insignificant or small, not insignificant, but small. Coming to the reason behind drop in prices, Russia, which earlier used to sell in Europe mostly, now because of ban, is pushing more material in Asia and India. They are selling at unrealistically low prices. Consequently, with our focus on capacity utilization, we also have to play a bet on pricing, which is also reflecting on the drop in margins in the current quarter. With all the work that we are doing on portfolio building, on efficiency improvement, and also with higher volumes, operating leverage would be favorable for us. We believe that from a four- to five-year perspective, we would be largely on track with our guidance of the INR 25,000 EBITDA per ton. Got it. Got it. Thank you. That's it from me. Thank you. The next question is from the line of Sanjesh Jain from ICICI Securities Limited. Please go ahead. Hi. Good afternoon, and thanks for taking my question. First, touching upon the Aquapharm, this quarter EBITDA, because if I take INR 194 crore the full year, it appears that we have done only INR 38 crore for this quarter, while the earlier run rate was INR 50 crore. On a much higher volume, much higher revenue, anything which has one-off or anything which has happened in the EBITDA margin for this quarter? Sanjesh, the EBITDA for the quarter is INR 51 crore. I don't know why we're getting INR 38 crore. Because we have disclosed INR 194 crore for the full year. Yeah, INR 194 crore is for the full year. You're right. So in the first nine months, what we have disclosed is INR 156 crore. So 194 - 196 is 38. The EBITDA, 194 crore that we are talking is the reported EBITDA. And in the first three quarters, we are mostly talking about the operational EBITDA. This year, also, there are some expenses which are being incurred on consulting side like BCG, McKinsey, right? And when we report numbers, those expenses also become part of our operating expenses. And consequently, our reported EBITDA comes down. So like-for-like basis, fourth quarter is better than the first three quarters. And fourth quarter is still only a small reflection of the improvement which is now happening in the business. A good reflection of it will be from the current year, first quarter itself of the current year. Got it. Got it. So that's on it. But how do we see this 194 going? Because that consulting fee and all will be done in FY25. So from a reported basis, where should we see EBITDA for FY26? The business, with its capacity as potential, it did perform INR 400 crore plus EBITDA two years back. And we strongly believe that now with more capacity addition and more product launches and better portfolio, we can further improve from there. It will take a couple of years' time to maybe cross that INR 400 crore. But this year itself, we believe that we can do 40%-50% better performance. Fair enough. Fair enough. Now, coming back to the carbon black, again, there is a drop in EBITDA sequentially. Any particular reason you are seeing pressure on the premiums which we were earning or the product mix? Because specialty mix has remained fairly stable. So what is driving this drop in the EBITDA per kg in the carbon black business? The fourth quarter was kind of an uncertain quarter from a global economic point of view. Post this presidential election in the U.S., there was an indication that there would be some tariffs which will be levied on all trade partners of the U.S. And consequently, a lot of our customers, they wanted to reduce inventory, not knowing as to how it is going to impact them. And therefore, I mean, the demand was sluggish generally. Also, Russia last two quarters has started dumping in India and in some of the Asian countries. And they are selling it at almost $200 lower prices. Now, we want to keep our capacity utilization high. And therefore, we still booked some volumes which were not at our usual margins. That Russia dumping continues because I don't see why it will not, because they need to somehow place their around 0.7 million of capacity somewhere in the market. The market opens up with China, India, and China, which are larger markets which can absorb this. This situation is unlikely to change, right? Yes. I mean, possibly they will continue with this. We'll have to find new markets and customers, which is precisely what we are focusing on. So when we say INR 25 EBITDA per kg in the next three, four years in such a scenario, can you help us understand the bridge how we really want to transform this from the INR 17-18 a kg EBITDA to a INR 25 a kg EBITDA? Sanjesh, the operating leverage itself is going to play a big role. For every 10,000 tons incremental sales volume at current gross margin that we make, it will be adding about INR 400 per ton to the whole portfolio at EBITDA level. But we're already at 95% utilization, right? How are we going to add that volume? Yeah, but we are adding capacity. 90,000 tons capacity is going to come in a year's time. 30,000 of which is almost full. Right. And then in a year's time, we will have more brownfield and then eventually a greenfield in Andhra Pradesh. And greenfield is not going to add that much. No, no, no. Greenfield will also add because the head office expenses are not duplicated, right? So they remain more or less stable, right? Maybe the operating leverage will be a little less there, but we will still have operating leverage. And this INR 400 per ton is at 10,000 ton additional volume. We still have cushion even with the brownfield expansion which is in pipeline to add just INR 4,000 from operating leverage. But I'm not saying that our operating cost structure would remain the same. So maybe half of that, about INR 2-INR 2,500, is going to come against this 90,000 ton capacity itself. And then product portfolio is also changing. For every incremental 1,000 tons of specialty sales, our blended EBITDA improves by about INR 60-INR 70. And every year, we can add between 7-10,000 tons additional specialty volume. Also, in specialty, we are moving up the value chain. Our MD Mr. Roy just mentioned about a 1,000-ton superconductive capacity. Now, here, the margin profile is likely to be in tens of thousands of dollars as against our current $400 average gross margin. So the margin profile in the new product launches will be very different from the conventional products that we have in the portfolio. And add to that the work that we have been doing on the yield side with still a sufficient cushion. We are not the best manufacturer even now. So when we are talking about 25,000, we are not saying that at that level we will get saturated. That's just our next five years' target. Maybe we'll do better. Got it. Got it. But any example? Is any operator in the carbon black doing INR 25 EBITDA per kg? See, INR 25 EBITDA will be difficult because different countries have different cost structure. But at gross margin level, there are certainly companies which have at least INR 7,000-INR 8,000 better margins than us. Fair enough. Just last question from my side. This acetylene-based what we are trying to do, the specialty, the raw material will come from China, and the capacity which we are putting, the technology is also coming from China. Is that a fair understanding? And how much more profitable is this product from the EBITDA per kg perspective? Your understanding is correct with respect to the technology and the raw material. And what we are seeing in India, India currently imports about 2,000 ton of acetylene black. And it is sold at around $800-$1,200 a ton currently. Sorry, sorry. $4,000-$5,000 a ton and with $800-$1,200 kind of margin per ton. Which is almost 3x what we do. Yeah. Fair enough. Fair enough. That's it from my side. Thanks for taking all those questions and best of luck for the coming quarter. Thanks, Sanjesh. Thank you. Thank you. The next question is from the line of Krishan Parwani from JM Financial. Please go ahead. Yeah. Hi, sir. Thanks for taking my question. Three from my side. First, on the carbon black side, what is the volume growth headroom in FY26 considering the time taken to bring the new capacity on stream? We should be doing about 650,000-660,000 tons, which is about 9%-10% increase over our FY25 volumes. Okay. So you do have a growth headroom from that 90,000 expansion that you are doing at Tamil Nadu. So from there, you are expecting an incremental probably of 50-60 thousand tons. Is that correct? We have about 35,000 tons of capacity cushion already. And then one 30,000-ton line is ready for commissioning in Tamil Nadu, which is part of 90,000 tons. So that itself would give us this additional 50-60 thousand tons. And then once the larger line of 60,000 tons is commissioned, which will be towards maybe third or fourth quarter of this year, then we will have more capacity available. But we are not counting that in our current numbers, this 50-60 thousand tons volume. Okay. And you are fairly confident with the domestic demand, not very strong, I think, Kaushik's earlier commentary. So with the export volumes, with the strong export volumes, you are confident of achieving 650-660 KTP, correct? Yes, we are. Okay. Okay. Secondly, I don't know. I mean, if you mentioned it earlier, the reason for decline in carbon black spreads this quarter. And probably what's your aspiration for, let's say, for the next year and a year after that? See, the market remains extremely volatile, and therefore it may not be very linear kind of improvement in our margins. So like in the past, you have seen that in some years, our margin jumped by INR 2-INR 2,500 also. And similarly, in some years, it tended to remain flat. So while on long-term basis, maybe three to four years' basis, we are fairly confident that with our initiatives, with changing portfolio, right, and with operating leverage playing its role, we will be moving towards the targeted number. But immediately in one year, two years, there are a lot of things which are changing very rapidly, like this tariff thing itself, this U.S. tariff thing, how it is going to impact the entire ecosystem of auto industry across the globe. That is yet to be assessed. So I would say that this is a little early for us to comment on how margins are going to be this year. But we believe that we should be able to maintain our margins. Okay. Maintain it probably INR 18-20. Is that correct? Our current year's average EBITDA margin is around INR 20,000 per ton. Yeah. Okay. Yeah, 18-20. That's a range. Yeah. Okay. And lastly, on Aquapharm, just one or two clarifications. So our Q4 FY25 EBITDA is INR 51 crores, while our EBIT is INR 19 crores. So I think depreciation is closer to INR 32 crores. So just wanted to understand why is the depreciation so high for largely depreciated assets that you had acquired? We acquired this company at around INR 4,000 crores. And as per accounting regulations in India, the difference between the value of physical assets and the acquisition value, that becomes intangible assets, which are available for amortization and which also carries tax benefit. So a good portion of this depreciation and amortization is on account of amortization of intangible assets. The quarterly run rate is INR 23 crores. Okay. So INR 23 crores. And then what explains the difference between the 32? Is it other income, INR 9 crore, or was it whatever? The balance is the physical asset depreciation. Oh, you mentioned. Okay. Okay. Fair enough. You were saying that the physical asset depreciation is INR 9 crore quarterly, and then the intangible is okay. Fair enough. And the physical as well as intangible amortization is also entitling us for a tax shield. It is going to be used almost around INR 500 crore, and which kind of makes profit of Indian business exempt from tax for next 7-8 years. That's the kind of shield that we are going to get out of it. Okay. Fair enough. So got it. And I think just one last bit. On the Aquapharm EBITDA side, I think you were till about last guiding that by the end of FY25, exit run rate of EBITDA should be about INR 70-80 crores. So how far are we from that exit run rate of INR 70-80 crores quarterly in Aquapharm? INR 70-80 crore guidance was for FY26, fourth quarter is what we said we will be reaching. And we are fairly confident that we would reach or God willing cross that number. Okay. Okay. Okay. Fair enough, sir. Thank you for answering my question. Sir, if I can add on the Aquapharm side, see the green shoots are visible from last quarter onwards. Both on our top two categories of business, which is the oil and gas chemicals and the detergent side. On both these businesses, we see a very good growth opportunity this year. The fact that we have a local manufacturing facility in the U.S. in Texas, I mean, with this whole trade thing, tariff thing happening today, there are a lot of uncertainties. But we see a very clear advantageous situation emerging in the next few weeks and months. Hopefully, when we come back to you by the end of the second quarter of this year, we should be able to come and tell you about the significant growth prospects on the Aquapharm side. So overall, we are still talking about almost a 50% kind of EBITDA growth coming in Aquapharm this financial year. So that kind of a number visibility, we think we should be able to deliver. Okay. That's great. That's great, sir. Sir, I think if I may, I missed one question. If I may squeeze in here. Yeah. Yeah. In terms of the capacity expansion in Aquapharm, that 38,000, I think it was supposed to come on stream in March 2025. So is there a delay of one or two months, or when will that come on stream? Some capacities have been commissioned before March, and the rest is in process of getting commissioned. So it is already kind of ready at this point of time. And it is just commissioned two, three days back. So it has already happened. There's a slight delay, not exactly delay from the point of view of completing the activity. It took some time to get clearance from local government, what we call is consent to operate. That took a little longer than expected. And that is why this delay, but it has already happened now. Understood. Understood. Thank you so much for patiently answering my q uestion. Wish you all the best, sir. Wish you all the best. Thank you so much. Thank you. The next question is from the line of Shailesh Raja from B&K Securities. Please go ahead. Yeah. Thanks for the opportunity, sir. So we are planning to set up the Mundra-based facility in Palej and also within 10,000 tons capacity for acetylene black in Mundra. So why are we not considering Naidupeta for these two projects? Are these two products not eligible for 17% concessional tax rate in Naidupeta? No, Shailesh. Actually, our R&D team operates out of Palej. And these products, I mean, these lines will be like would require a lot of technical support and R&D support. And therefore, we are planning to set it. Also, and even getting the MoEF approval, etc., will take at least a year's time. We can't afford to delay our projects. Right. So you want to add something? Okay. Okay, sir. My second question on the input-output ratio trend. This has been one of the key drivers behind the improvement in our last five years. Currently, our approximate input-output ratio stands at 1.8:1 in standard and performance carbon black. So based on my estimate, that's a 10x improvement in ratio translated to saving of INR 150 crore, if my understanding is right. And what is our target input ratio over the next two, three years? So you may not be able to calculate it based on the raw material consumed and the overall production level because the portfolio itself is changing, and not all grades have the same input-output ratio, right? But internally, we have the benchmarks for each of the grades that we produce. For 1% improvement in yield, it's almost like 100-odd crore INR, 100-150-odd crore INR. I mean, it will also have a relevance to crude prices. At current crude prices, about a 1% yield improvement is about roughly 1,300-1,400 INR EBITDA per ton for us. Okay. Okay. Okay. Thank you. Shailesh, are you there? Thank you. The next question is from the line of Siddhant from Trust. Please go ahead. Yeah. Am I audible? Yes. Sir, I just wanted a little clarity on the NanoWave technology. So what is the progress so far, and what's the update? Are we looking to commercialize the plant in FY27? Yeah. So NanoWave, currently, we are working on the pilot plant. All orders have been placed. And on-the-ground activity will start very soon once the supply starts. We are expecting by end of this calendar year, which is October to December, during that quarter, we should be able to commission that plant. And in parallel, we have already started discussion with prospective customers, both in battery side as well as anode side. And in addition to that, also with some of the leading automobile manufacturers. So both activities are going on in parallel. And once we get approval from them based on the pilot plant samples, we'll immediately start the commercial plant thereafter. But in terms of technology, we have already established credibility, right? That? Oh, yes. Absolutely. Absolutely. Absolutely. Okay. And so regarding FY27, we are looking to commercialize the plant, right? No, we are looking at FY28 to commercialize the plant. The pilot plant will be ready by end of this calendar year. Okay? After that, we need to give some time for approvals and to put up the new capacity, the commercial capacity, which will take roughly about a little more than a year. Right. And just to understand the technology, so basically, we are replacing the graphite part in the anode with silicon, right? No, not really. We are mixing nanosilicon with graphite at a certain percentage. We are not replacing. Okay. So both are combined together to increase the life cycle of the battery? It's a hybrid thing. It will increase the life cycle of the battery, the charging between two charging points, charging interval. It will be much higher. Life of battery will be much longer. And at the same time, the emission level will come down substantially. So combination of all three. And additionally, cost overall will go up over a period of time. Fast running kilometers, the cost will go up. Go up, right. And in terms of technology, in terms of this technology, is there any competitor who is also looking to explore this, or are we the only ones having this technology right now? You can say in a way that nanosilicon, the kind of technology we are exploring, we are one of its kind in this area. There are other players, but it is so far not commercially viable or cost-effective. Okay. So the first mover advantage will remain with us? Absolutely. Absolutely. That's what the expectation is. And the cost, the revenue price will be $100? We are still sticking to that number? No, that was an assumption that we took, which is a very conservative assumption. Obviously, if it is selling at a higher price in market, there would be some discount to it that we'll offer, but it may be higher than $100 also, for all we know. It's a little early for that. That was for our internal conservative calculation of profitability. Right. Right. Thank you so much, sir. That'll be it from me. Thank you. The next question is from the line of Rolin Nandu from Edelweiss Public & Alternatives. Please go ahead. Yeah. Hi, team. Thank you for taking my question. I just want to understand our philosophy on this CapEx, right? See, given that in domestic market, we don't know by when this Russia dumping will end. Now, on the export market, also, there is uncertainty on tariffs, right? But at the same time, you mentioned that you can't wait for approval to come in Tamil Nadu, where we have probably a favorable tax regime there, right, in some sense, and hence we are expanding our facility. So just wanted to understand that given that the demand outlook is not very encouraging, at least for the near term, why is there an urgency to put CapEx? Well, we are already operating at about 90% capacity. That's number one. Number two, the lines that Shailesh was talking about were more on the specialty grades of carbon black side, for which we would require to provide a lot of technical and R&D support, which currently is not available in our Tamil Nadu plant. And consequently, we'll have to keep these capacities stationed near to the R&D center, which is in Mundra. So that's the reason. And third, the demand outlook, even when, say, the demand outlook in India is not good, right? Globally, still demand will grow by a certain percentage. Last 10 years, CAGR has been around 3.5%, industry growth rate, which adds about 500,000 tons of incremental demand every year. And that's on the regular carbon black side, not specialty. Specialty is a different market dynamic altogether. So there is sufficient cushion in market. And all said and done, we have just about 4% of the overall market size currently. Who stops us from taking this 4% to maybe 8% or 12% going forward over a period of time? Sure. Understood. So I mean, this announced CapEx that you have announced, right? Is this going to be only for specialty, or it's going to be the mix, right? Because you mentioned that the talent is available nearby for the specialty lines. So what could be the probable breakup that we are looking at between carbon black and specialty here? I guess you misunderstood. I said our R&D and technical team are in Gujarat, not in Andhra. But having said that, in Andhra, in the first phase, we will be putting up regular black lines. And then maybe based on requirement, availability of feedstock, and maybe availability of talent, we might also decide to add specialty capacity there. But as of now, we are planning to put up 150,000 tons of carbon black capacity, which will be rubber-grade capacity mostly in the first phase of capacity in Andhra. Sure. And just to double-click, last question from my side to double-click on this capacity utilization, right, that question that you mentioned. Could you help us understand what is the capacity utilization for specialty carbon black? Specialty, we are almost at 100%. Last year, which is FY25, we added a 20,000-ton line, and where we have about 7,000-8,000 tons of capacity available, which we hope to utilize this year. So immediately, we'll have to add one more line of specialty. And when will that come, the new line of specialty? Next 12-15 months' time. Okay. Okay. So till that time, we are that constrained on the specialty mix, right? Is that understanding correct? Not constrained because this year, we already have capacity cushion. So the capacity which came up in FY25 is largely available for this year's growth. And by the end of this year, we will have that line almost ready, the new line. Okay. That's it from my side. Thank you, team. Thank you. Thank you. The next question is from the line of Romil Jain from Electrum PMS. Please go ahead. Mr. Romil? No problem. Excuse me, Mr. Romil. Am I audible to you? Mr. Romil, your line has been unmuted. Please go ahead with your questions. As there is no response from the line of the current participant, our next question is from the line of Sara from UVR Fund Advisory. Please go ahead. Hi. Thank you for this opportunity. So my questions are related to Aquapharm. In Aquapharm, what is the current logistics cost, and what are the plans to optimize these costs? Excuse me, sir. You're saying that in terms of percentage? No, sir. Absolute. Currently, our— On per ton? On per ton basis, sir. So it could be very different. So Aquapharm has manufacturing facilities in three geographies: U.S., India, and Saudi Arabia. And from there, it caters to different markets. So there will not be any uniform logistics cost. Typically, I mean, if you were to look at the containerized rates, from India to Middle East or Southeast Asia, it will be about $20-$25 a ton. For Western Europe, it would be about close to $100 a ton. And from India to U.S., it will be around $150 a ton. These are the rates. All right. Thank you, sir. And what are the plan? Okay, sir. In Aquapharm, 85% of sales come from U.S. and Europe. What is the outlook on demand and pricing in these key regions? And what is the target addressable market in U.S. and Europe, and how much of the current market is catered by China? Well, the U.S. market is the strongest for Aquapharm from the point of view of demand as well as from the point of view of margin. So that is the best possible market what we have. Europe is a decent market, but obviously not as good as USA. So therefore, as an organization, our first and focus right now is to increase our sale in USA as much as we can. So that is going forward will be our strategy as we go along. While maintaining the presence in Europe because there are players like, for example, P&G. We are the largest supplier to P&G, and mostly it is supplied in Europe. So it remains, but at the same time, a lot of focus will be there in the USA market. This I'm talking about products which are sent or manufactured in India, Aquapharm India. Okay. Okay. So do we have any demand size in numbers for the same for US and Europe? Sorry, ma'am. Mr. ma'am. Mr. Romil, I don't hear you. Hello? Do we have demand size for the same for U.S. and Europe? In USA, the demand is strong because oil production is going at full swing in USA, and with Mr. Trump coming in, possibly that will increase further. The demand will increase further. So US side is pretty strong. Europe is a little soft, or I'd say it is a bit muted. And as I said, therefore, more focus is there for USA right now for us from Aquapharm side. Okay. Okay. Okay. That That I understood. I wanted some numbers like if you could give on demand side. On demand side, USA economy-wise, it is growing roughly about 1.7% this particular financial year. That is the projected growth around 2%, 1.72%. Whereas for Europe, it is almost flat. It is just about 0.5%-0.6%. Okay. Okay. So that is what the growth looks like in Europe anyway, sir. All right, sir. But of course, U.S. is the largest economy. So on that, almost 2% growth is not that bad, but it has definitely come down from the earlier numbers. All right, sir. So at what prices are China dumping, and how competitive is Aquapharm's pricing as compared to these prices that China is dumping? So right now, China is not able to dump in USA because of the current tariff, which is 145%. They're not in a position to dump. But yes, earlier, China used to dump a lot of material. And because of that, at places, we used to kind of compete with China, and therefore, it used to be a problem for us. But right now, a bit of an advantage for us, I would say, particularly from U.S. perspective, with 145% duty on charge. Okay. Okay. Okay. One last question. In the tot al debt that we have, how much is Indian debt, and how much exposure do we have for foreign debt? It is entirely rupee-denominated debt. Okay. All right, sir. Okay. That's it from my side. Thank you. Thank you. Thank you. Ladies and gentlemen, this was the last question for the day. On behalf of ICICI Securities Limited, that concludes this conference. Thank you for joining us, and you may now disconnect your lines.