Ladies and gentlemen, good day and welcome to the Pearl Global Industries Limited Q1 FY 2025 E arnings Conference Call. This conference call may contain forward-looking statements about the company, which are based on the beliefs, opinions, and expectations of the company as of the date of this call. These statements are not the guarantees of future performance and involve risks and uncertainties that are difficult to predict. As a reminder, all participants in the line 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 and zero on your touch-tone phone. Please note that this conference is being recorded. I now hand the conference over to Pallab Banerjee, Managing Director of Pearl Global Industries Limited. Thank you, and over to you, sir. Thank you. Good morning, everyone. I welcome you all to our Q1 FY 2025 Earnings Conference Call. Along with me, we have our Group CFO, Mr. Sanjay Gandhi, and SGA, our Investor Relations Advisors. I hope all of you have gone through the investor presentation uploaded on the exchange and our company website. I'm pleased to announce that our growth momentum persisted through quarter one of financial year 2025, resulting in our highest-ever Q1 and quarterly revenue, adjusted EBITDA and profitability. For the first time, we surpassed INR 1,000 crores in quarterly revenue and INR 100 crores in quarterly adjusted EBITDA on a consolidated basis. During this quarter, we saw a 17.7% increase in revenue, overseas revenue increased by almost 22%, and India revenue increased by 7.3%. Once again, this is proof that our strategies are working well and a testament to our competitive advantage as a global manufacturer. Our sustained growth, despite challenges at the industry level, is driven by the leveraging of our core strengths of multi-country presence, multi-category products, in-market design expertise, and strategic customer relationships. This growth primarily stems from increased orders from our existing customers, yielding better relationships as well as better wallet shares from the customers, which we have added over the last five years. Let me start with an overview of the industry. The textile and specifically the apparel retail and its supply chain is currently undergoing some significant challenges. This includes shipping delays, increased costs, higher container costs, higher energy prices, and inflationary pressures affecting global economies and hence the consumer spending. Overall, the raw material prices remain stable for now, with the exception of the linen fiber, which continues to be an inflationary trend. The U.S. retail market showed resilience in 2024, with the retailers taking almost 2% of year-on-year growth January to May period, but June sales are up by almost 4.3%. And most of the prominent retailers have already optimized their inventory levels. So we are estimating that their buying numbers will continue to be healthier for the rest of the year. On the contrary, we have the recent data on inflation, unemployment rate, and the Consumer Confidence Index of the U.S. These have not been favorable. These add to the already rollercoaster experience as we move closer to the U.S. election. So most of the U.S. retail industry figures are maintaining a cautiously optimistic stance. Year-to-date, apparel imports into the U.S.A. are down by almost 7% year-on-year for the first six months. Now, this is expected to improve in the second half of the year. Moving on to the U.K. retail situation, this market grew last year by almost 5% and has shown a further growth of 2%- 3% for the first six months of this year. However, if you look at the import numbers of apparel for January to May, that is showing a downside of 12% year-on-year. So this is estimated to improve over the next months for the next second half of the year. Similarly, we noticed the imports by the European Union are down by almost 7% and Japan is down by 9%. Now, again, both of these cases, like what we are seeing, the retail is flat or improving. So both these, again, these numbers of imports should improve for the rest of the year. Now, the Red Sea situation, the closure has increased the cost of transportation for the retailers of the U.S. and U.K. and the Western countries, but it has not impacted our costs as all our shipments operate under FOB terms. The key for us is to deliver goods faster. Customers are now expecting shipments at least a week earlier to account for this additional time required to reroute their vessels around the African continent. Further challenge in recent months is also the cost and availability of containers. Our manufacturing facility in Guatemala, with the transit time to the U.S.A. just over a week, is attracting increasing interest and inquiries from our customers. However, the capacity of my Central America remains limited and is only a fraction of what we have in Asia. Now, moving on to Bangladesh, the recent curfew did cause a closure of our factories for a total of six days. There was a loss of productivity during these closures. We plan to recover this loss in the coming days and weeks. There has been no damage to any of our property, and our focus remains on minimizing the impact to our customers. We have already cleared all imports from the seaports and dropped out all export cargo to the ICDs with more goods on the way as we share this update to you. All our factories are working at full strength with high attendance. The textile industry in Bangladesh does have some advantages compared to other geographies, which will further keep them ahead of the competition. The textile industry has become a major sector of Bangladesh's economy. It represents 84% of their total export and 15% of their GDP. It is still lower in terms of cost and reasonably good efficiencies and productivity if I compare it with other geographies. The skilled workforce and well-experienced middle and lower-level management staff are easily available. Bangladesh has been improving their logistics infrastructure by leaps and bounds in the recent months and years, and it has got favorable trade agreements. We believe that whichever government is formed in the country, they will take adequate and fruitful steps towards maintaining their edge of the garment and textile industry, thus looking at a high weightage of the industry as an overall economic performance. Moving on to Vietnam, we will maintain our growth trajectory. However, at a more consistent pace, we will continue to expand this market for us while focusing on delivering exceptional service to our high-end customers. Indonesia is set to regain its performance levels after a decline over the past two years. India this quarter experienced a higher percentage of absenteeism and attrition at our factory levels, and this has been due to the prolonged election and the very high temperature that India experienced this summer. We also experienced the increase in wages and pay across all our states. All this resulted in additional manufacturing costs and some potential delays. We managed to avoid any major delays and airfreights. Now, long-term, the Indian government is prioritizing garment manufacturing as an important contributor of employment growth through various initiatives. We enhanced our existing capacities in the states of Haryana, Karnataka, and Tamil Nadu over the last year. Going forward, you will see us investing and starting production in other states like Bihar, Odisha, and Madhya Pradesh, where there is an availability of labor force and is relatively less expensive than our existing production locations. Also, recently, we successfully completed our qualified institutional placement. We raised INR 149.5 crores with QIP amongst a range of prominent investors. We remain committed to investing in operational improvements, enhancing governing process, digitization of all our factories, and improving our financial rating. Our dividend and capital allocation policies are already very well-defined. Having announced our strategic plans and objectives for 2028, we believe we are progressing steadily and solidly towards our goals. We will continue to expand our relationships with our customers who are strengthening their position in the global market. Our focus will be on consistently surpassing our previous records in revenue, capacity, and efficiency, which will directly contribute to enhancing our bottom-line profits. Now, I will hand over to Mr. Sanjay Gandhi, our Group CFO, who will walk you through the quarter one financials for the fiscal year 2025. Sanjay, over to you. Thank you, Pallab. Good morning, everybody, and welcome to our Earnings Calls for quarter one FY 2025. I would like to start by sharing our financials and operational performance for the quarter. Starting with the consolidated financials, we are happy to report the best-ever quarter one and quarterly performance in terms of consolidated revenue, adjusted EBITDA, and profitability for Q1 FY 2025. Our consolidated revenue reached INR 1,052.8 crore, a notable increase from INR 894.2 crores in Q1 FY 2024. Revenue for this quarter increased due to an increase in overseas revenue by 22%, led by growth in sales in Bangladesh due to healthy growth in business for most of the customers. This represents a growth of 17.7% in consolidated revenue, marking our highest-ever revenue for the first quarter and setting records for quarterly revenue. For the first time in our history since we have achieved quarterly adjusted EBITDA surpassing the INR 100 crore mark, we achieved INR 100.4 crore, which is a growth of 18.8% year-on-year. Adjusted EBITDA growth year-on-year is in line with the revenue growth. Adjusted EBITDA excluded these one-off expenses of INR 2.1 crore in quarter one FY 2025 and INR 1 crore in quarter one FY 2024. PAT for the quarter stood at INR 61.9 crore versus PAT of INR 47.4 crore in quarter one FY 2024, which is a growth of 30.8% year-on-year. However, if you look at PAT including the minority interest, it stood at INR 65.3 crore in quarter one FY 2025 compared to INR 48.1 crore in quarter one FY 2024, a growth of 36% year-on-year. During the quarter gone by, volume increases led by an increase in the knit business, and the average realization is lower due to the change in product mix, moving knit 58% woven 42% in quarter one FY 2025 compared to moving knit 73% woven 27% in quarter one FY 2024. Coming to the standalone financials, in standalone performance for quarter one FY 2025, revenue increased to INR 276.2 crore compared to INR 257.5 crore in quarter one FY 2024, representing a 7.2% year-on-year increase due to growth in business with new customers. Adjusted EBITDA witnessed a decline of 34.3% year-on-year to INR 13.3 crore in quarter one FY 2025, with adjusted EBITDA margin at 4.8%. This was impacted due to low productivity in a couple of our factories. PAT for quarter one FY 2025 goes to INR 15.9 crore, reflecting an increase of 37.1%. Please note we had an exceptional gain of INR 5.48 crore due to sale of non-core assets during the quarter. Furthermore, we would like to inform that Pearl Global (HK) Limited, Hong Kong-based subsidiary of the company, has appointed Deloitte Touche Tohmatsu as its Statutory Auditor for the year ending 31st March 2025. Our focus continues to have robust governance control. As highlighted earlier, we had completed our QIP and raised INR 149.5 crore from marquee investors, and we deeply value the confidence our investors have placed in us. I am now happy to take any question you may have. 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 and answer on 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 Vignesh Iyer from Sequent Investments. Please go ahead. Thank you, sir, for the opportunity and congratulations on a solid set of numbers. So just to understand, I mean, I understand we have lost some few days in Bangladesh due to the unrest. So just trying to understand what is the growth going ahead and how so we would have got a reasonable idea of how the orders for the winter wear that will come from the U.S. and the States. So if you could just give us an idea of how would the winter pan out this time around? Specifically, you're talking about Bangladesh or in general for all regions? Yeah. So firstly, I mean, immediate basis, how our performance, I mean, how our volumes might be impacted due to Bangladesh, and on more from a medium-term perspective, how the January, February, March quarters will pan out? Because if I understand correctly, it's like six months before we have a reasonable idea of how the orders are and how the demand is from the U.S. and the U.K., so both are expected. Got it. So as I just mentioned, let me just for the second part of the question, I'm replying first, which is the general market trend that we are seeing. Definitely, last year was extremely tight because of the over-inventory situation that we saw in a couple of countries, especially the U.S., and I think that part is behind us, so in general, what we are seeing is definitely the order flow is much better compared to last year. In fact, we have planned a growth, and we are solidly on track with that growth plan, so I don't see a big reason of concern at this point in time unless until something from other surprises runs up across the world, so that's something I think what we're looking at across most of the regions. I'm talking on behalf of the U.S., the U.K., Europe, Australia, Japan. I think its business is at this point in time quite normal compared to what we have seen last year. The second part of the first question that you had about what's happening in Bangladesh. So Bangladesh, we had a disruption. So for example, five complete days we lost of production. We had to shut down because of curfew, and then one day we could do only run partially. So that's why we considered that six days of production loss. I think over the next few weeks, with additional overtime and working on a holiday kind of thing situation that we do normally in such extreme situations, we are confident of making up this production loss. To our customers, what we have given the plan, there are very few delays that we are experiencing. So we are well in control. There could be a little bit of over expense that might happen to make sure that we are doing this kind of overtime or maybe a little bit of investment in the shipments and all, but not a very big impact on overtime. In terms of what is happening currently, I think what we are seeing is very good turnover, sorry, the turnout of people in the factory. So in fact, normally we see about 2%-3% of absenteeism in our factories. But since the time that we opened up after the curfew, the attendance has been even better. So that's something encouraging. People do want to work. The workers are quite serious in terms of all our factories are running at full strength at this point in time. We haven't seen any problem in terms of any logistics or any movement of material or movement of personnel. Most of our staff, like a lot of people from India, are staying in Bangladesh also. Some of them did come back because there were a lot of concerns when this curfew and when this change of government happened, but most of them are now back and things have been normal, and some of them continue to stay in Bangladesh because we immediately started the factory as soon as we could, so that way, we haven't seen much of a problem in Bangladesh as of now. Does that answer both of your questions or anything else? Yes. Yeah. Just Just one more question from my side, so we have seen almost an 18% growth on YoY basis on a volume plus realization, that is value part of it. If you could tell me what is that volume growth that we have seen on YoY basis and if this number is sustainable going forward on a YoY basis? Volume growth. The volume growth is 35% is what we have seen here. I think we mentioned that as a part of our three-year strategy, most of the growth in revenue will come will be driven largely from the volume growth. The realization is a function of the product mix which is in that particular year. If you look at our February 2024 analyst meet, we have mentioned clearly the product mix which will be 60/40, moving in 40 next business. Our overall prediction for FY 2028 still was based on the volume growth. Definitely, since it is in line with our strategy, it is sustainable in that way towards our objective what we have set forward. Okay. That's all from my side. I'll be speaking to you, sir, and all the best. Thank you. Thank you. Next question is from the line of Palash Kawale f rom Nuvama Wealth Management. Please go ahead. Thank you for the opportunity, sir, and congratulations on the second number. So my first question is on Bangladesh again. So do you see any change in plans in terms of your capital allocation or are plans pushing us to get out, like supply them from other countries because of the recent civil unrest? Or do you see things would be as we had planned earlier? As of now, we haven't faced any pushback from any of our clients. But yes, in general, I think that's the sentiment that you expect when this kind of incident happens. The kind of strategic relationship that we have, we got immediately supporting messages from our customers. And we had dialogue. If anything becomes prolonged in Bangladesh, then we can shift some of our business from Bangladesh to our other regions. So that dialogue, we were ready with. Our planning and our backup was always there. We didn't have to go that route. Things became quickly very normal, and the productivity and everything is quite smooth, and I think totally as per our plan. In terms of future capital allocation, what we had in terms of before this revolution or before the change of this government, so we are not changing big time any of our capital allocation across all the regions as of yet, including Bangladesh. So although we were not very aggressive in one region at the cost of other, so that was never our plan. So we have incremental growth in all the regions, and that we will continue unless until we see there's a big change. Okay, sir. So thanks. And sir, what was the contribution from partnership model in this quarter? And what was the contribution in Q1 FY 2024? We have given that detail as well. The partnership factories are contributing around 21% in quarter one and 79% now. This is in terms of the volume. Bangladesh overall? [crosstalk] Overall, yeah. This particular quarter, you see a little bit of higher contribution from the partnership factories because we experienced a growth in our numbers, and as we adjust our production lines to grow. So yes, this particular quarter, we have a slightly higher number of partner factory contribution. And sir, how should we model FY 2025 volume numbers since the volume growth is so high in the first quarter? So are you confident of maintaining this trend? I think what we have said for the three-year period from in our meeting last, we continue to be that overall on an annual basis, we are seeing 12%-14% of revenue figure is something which we are confident of achieving over a period of three years. I think to be in line with our strategy, it is better to keep that model in sight. Of course, there will be some positive surprises if it comes in any quarter. We'll be happy to communicate periodically, but to really look at from the long-term perspective, we would like to keep our guidance of 12%-14% figure in revenue growth and a bit of 10%-12% by FY 2028. We are optimistic about achieving that. Okay, sir. Thank you for that. So my last question is, how is seasonality for apparel since we have both knits and wovens? So quarter-wise, how do we see the seasonality? Apparel manufacturers have different categories, right, from outerwear, knits, wovens, tops, bottoms, children wear. When we talk about the seasons of outerwear in the Western countries, then the dollar-wise, you will see a little bit of jump that happens. The FOBs are much higher compared to the spring-summer seasons. But I think in general, we don't see a huge swing in our total consolidated numbers. Normally, for the spring-summer region, like India region becomes much stronger. For the fall holiday region, when the outerwear is high, that time Vietnam or Bangladesh, where a lot of denims and bottoms happen, that's winter. So more or less, it compensates each other. Maybe a little bit of variation that you might have, but not a major. Thank you for your detail. That's it from my side. Thank you. The next question is from the line of Bhavya Gandhi. From the Dalal & Broacha Stock Broking, please go ahead. Yeah. Hi, sir. Thank you for the opportunity and congratulations on a good set of numbers. Just a couple of questions from my end. One, with respect to what was the revenue contribution from new customers in this quarter? And how are we seeing these numbers move from last maybe three, four, five quarters? If you can throw some light on that. We are looking at, sorry, just to understand your question, less than five-year customer and more than five-year customer. See, for us, the real yardstick to measure this number is for the full-year basis. If you recall our last presentation, we mentioned in FY 2024, we had 44% of the revenue coming from less than five years, and more than five years is 56%. Now, what will happen over the period of this year where it's eventually 2025, some of the less than five years will get converted into more than five years because they have been with us for now almost for another year as when we mentioned in the last time. So gradually, there will be a shift. But at the same time, we are working on additional new customers. That will happen within the journey, which takes over a period of 12 months time period. We would like to mention that last year, as of 31st of March, the full financial year, less than five years were contributing 44%, and more than five years were contributing 56% of our group revenue. As we started this journey, this 44% is gradually becoming migrating to the more than five-year. But we will see the real picture coming up and then to the five-year as to how the overall numbers look like. It's better to look at a full-year basis. So conceptually, I can explain a little bit more. What happened was in 2019 onwards, as we built up the strategy to take towards our goal of growth and achieving the number that we have stated, so we had introduced and we had approached a lot of new customers at the same time. So that group of customers gave a good run now. Some of these customers are becoming much more strategic. That means they are becoming pretty sizable and maybe like top two or top three customers of ours. That part will continue to grow. Then over this last couple of years, two or three years, again, we have introduced some customers who may not be going into the strategic level, but we continue every year. We continue to add, like we see the map of our customers across the globe, who are the customers who are doing financially strong and where we can definitely add value to them and they can be a good partner to us. That process is on. The huge jump or infusion of new customers that happened in 2019, 2020, that is now overall, like Sanjay J ust explained, beyond five years now. We'll see a little bit of fluctuation out there, but this number would, I think, be in this region more or less going forward as well. Okay. As in another way, I get your point. How big can this customer base be? I mean, let's forget about four years, five years, or seven years. The new customer is going to be after 2020. How big can they become? I mean, in terms of revenue, it would be closer to INR 1,500 crore-INR 1,600 crore on an annualized basis. So can it be like INR 7,000 crore-INR 8,000 crore, or we will peak out at INR 2,000 crore-INR 3,000 crore if we can throw some light on that? It's an absolute number. In terms of individual customers, if I talk about what we do, we always introduce customers like who could be in my top five. And by top five, I mean that eventually they should have a runway to do about $100 million. So that means $100 million would be how much? INR 800 crores. So that would be, I think, is a fair estimate. Of course, there are a few like Walmart and Target who can be even $200 million-$300 million also if we can service them well. But at this point in time, our target is to have the top three or four customers who should be in the $100 million mark. And then my second tier of customers should be in the range of about 40, 50, 60, in that range, $40 million-$ 60 million range. Then comes the tactical customers who should be in the low $20 million, as you say. So that's how we classify our customers. We always try to have when we're introducing new customers, we want to see over a period of maybe four or five years, what is the runway? Can they be a $50 million customer for us? Can they be a $100 million customer for us? That's how we go through this process. So we do have identified who those three would be, who would be more than $100 million, who are those five or six who should be in the range of $50 million. And then, of course, there is always the bottom of the pyramid where we'll have anywhere between 0 to 20. Excuse me. I mean, I'm just trying to understand how this really will be moving. So the customers of $100 million that you are saying, what's the current size as of now? Are they like a $20 million customer or already they have reached $50 million? So one of them has touched $100 million. The second one is about to touch $100 million. The third one is crossing at this point of time, maybe around $55 million-$60 million mark. We'll move towards $100 million. So like that. Similarly, the one we just mentioned will be crossing $50 million-$60 million. One of them is at least around $40 million at this point of time. Some of them are in the range of about $35 million-$40 million in that range. So yes, that's the kind of mix we always maintain in terms of our strategy. In terms of possibility of their total procurement, how much would we be as a part of the total procurement cost? I mean, because I believe they might be working with at least 20-30 vendors, and they would not allow you to credit 20%. Yeah. So that you see from their sourcing or procurement point of view, they would maintain us in the single-digit of their share. So rarely it goes into double-digit. But yeah, there could be either high- or low-single-digit. So we have some room to penetrate in terms of percentage? Of course. Yeah. Okay. So I mean, if we extrapolate all these numbers together, so we believe, I mean, 12%-14% would be on the lower side of the guidance. I believe we can even go at a faster pace than this. I mean, I'm just implicitly asking that we have the ability to do it. Whether we may do it or not is a different thing. Yes. The opportunity will definitely, I would say, exist. Like how we play our cards and how we strategize ourselves, like overall in terms of our infrastructure, in terms of our strength, in terms of our serviceability. We do not want to go for a very aggressive growth and then may not be able to service them. So that also is very important in any industry. So yes, that's how we have planned in that range. But yes, if it's a couple of percent more or maybe 5% more possible, we should not lose that opportunity. But yes, we will not go for a very high aggressive and overcommitting to 100 anyway. That's the situation that we would like to avoid. Got it. I think at this point of time, the margin system, what I'm seeing, yes, anywhere at 12%-14% or maybe a few percentage higher is possible, easily. Got it. And sir, are we seeing any consolidation? Thank you, sir. May I request you to rejoin the queue for your follow-up question? Thank you. The next question is from the line of Parth Patel from Unifi Capital. Please go ahead. Hello. Yeah. Am I audible? Yes, sir. You're audible. Yeah. So congrats on a strong number. So the question is, when you look at this Bangladesh situation, what do you reckon? And I think the last 10 years today, we should be in February to give a plan of around INR 500 crore CapEx for the next three to four years. So can you explain strategically which INR 500 crore CapEx we are planning for the next few years? In which geographies it will go? Because it's actually Bangladesh is around 50%, more than 50% of our capacity today. So incremental CapEx, are there any strategic changes which you are thinking of doing of this CapEx not in Bangladesh, in other geographies going forward? So in Bangladesh and India are our major contribution as of now. In India, we realize that we are in places which are more expensive. So we have to move some of our factory or add factories in the lower-cost region. So that definitely would be an important part of CapEx. Bangladesh, being the largest contributor, almost about anywhere between 40%-44% expectation is that it will continue to come from Bangladesh. So that will draw some CapEx as well there. And then, of course, followed by Vietnam, Indonesia, and Guatemala. So we are definitely spreading our CapEx across all the locations. In terms of, I would say, is there any change, immediate change reacting to what has happened in Bangladesh in the last couple of weeks? No. We haven't. At this point of time, we are keeping a close watch on that. We are seeing a good reaction in terms of, see, Bangladesh, if you look at overall, the readiness for the industry is much higher compared to the other countries who are there in this particular industry. So I don't see a huge change that will happen. But yes, Bangladesh also will undergo some sort of consolidation of players for sure. As the country regroups itself, there will be a little bit of economic ups and downs. So during this period, smaller players or the weaker players will move away. The stronger will become much, much more stronger. So that's what normally happens. That's the kind of trend we have seen in Sri Lanka, in Pakistan, and in other third-world countries as this kind of upheaval comes once in five, 10 years. We have seen that. In fact, India also has undergone in the past. That's something I think is something that we will have to have a very close watch. We will definitely, any investment that will happen from our side will be completely based on the ROI. We do a very rigorous analysis in terms of what kind of ROI is possible, what we are seeing, and how fast we can achieve that. That's something that is a criteria for our decision-making. We'll continue to evaluate. We continue to analyze this and then take the steps. Yes, so far, we didn't have any major plans in Bangladesh. Whatever plans that we have in terms of our growth in number of lines or incremental addition in terms of our production capacity, that we are continuing. So from the near-term perspective, in FY 20 25, where are you adding the capacity? FY 2025, where are you adding the capacity in which geographies? So FY 2025, see, our plan is one is in India. We are adding capacity in Bihar, and the second is in Odisha in the partnership factory in collaboration with the existing factory, which is infrastructure which is existing there. The second is increasing capacity in Bangladesh and India also in Madhya Pradesh. The commitment to capital expenditure will happen in this year. The capacity addition may spill over to the next financial year. So the commitment will happen in this financial year in Madhya Pradesh, in India, and Bangladesh also. We are exploring a good opportunity at the right time and the right place. I think those commitments will also follow. So we'll send the evaluation and continue to get the evaluation. So the concrete plans currently are in India only. Now, in terms of EBITDA margin, I think the long-term guidance is to move to a double-digit kind of EBITDA margin. But if I see this quarter's rise in operating expenditure, then the EBITDA margin is almost flat YoY, right? So, what's the outlook on the EBITDA margin going forward in the next nine months in FY 2026? So I think the way the ICRA is coming up with the expected capacity and utilization and efficiency and the order intake. I think as we go into summer and spring season, we are optimistic about hitting a double-digit EBITDA, I guess, by the end of this year. And the next year should be in line with those double digits as well. Here, I'm not talking about a double-digit EBITDA at this moment, which is, I think, we are optimistic about achieving it by the end of this year. Okay. Fair enough. The last thing on. Concluding the interview, sir. May I request you to rejoin the queue for your follow-up question? Okay. No issue. Thank you. Thank you. The next question is from the line of [Kaushik] from AK Investment. Please go ahead. Yeah. Thanks for the opportunity. I have a specific question to Bangladesh and a product question. From the Bangladesh side, what makes you available? I understand it's a larger expenditure, but there are also because I think the margins are sustained because of the tariffs and the low-cost expenses, right. So once there was also news from the European that the tariff will be moved out, then how does it strategically fit our company? That is my first question. And the next question is basically if we see that there is also a lot of push happening in India, that you want to have a global sourcing partner from India, from moving from 5%- 15%. So how do you want to grab this opportunity? And how much time it would take if you want to put up any additional capacity, suppose out of the world, right? If suppose something again happens in Bangladesh, right, because we don't know about the geopolitical reason, it can be anything. So for you as a company to mitigate the risk, how fast can we add the capacity anywhere or can you throw some light on this strategy? Yeah. So first is about tariff and in Bangladesh. So Bangladesh has got LDC status, and because of which they have a GSP benefit for the European countries and U.K. So that benefit they would have till 2029 if nothing changes. If there's an extension, then it will go beyond that. Initially, there was some conversation of not extending it, but I think with the current situation that has evolved, the chances of getting it made go a little bit better. So anyway, so let's not speculate that. As of now, our strategy is definitely to make sure that all our calculations are on the basis of it in 2029. Beyond that, when we make a project of CapEx and all, we take it later. We take this part as a given. And beyond that, we don't take it in our calculations. That is the first part of your question that you had. In terms of strength of Bangladesh, as I said, Bangladesh has a population which is hungry, which needs to be fed. That's a country where the food cost or the food expenses will always be higher compared to a country like India or other places where we have a lot of farming and a lot of things, variety that we can do. So in general, what happens economy-wise, that segment of population which would need that work would always be there. And that's something like what we have seen when we compare the workforce in various countries. We find that Bangladesh, or to a certain extent, Indonesia, is definitely the stability and the kind of the output that we get is much, much better. Absenteeism, attrition, disquality, all these things are definitely scored much, much higher compared to the other countries like India or Vietnam or other places, so that's something that is important for the industry, and we are very much cognizant about that fact, and our decision-making or our analytics, as I said, would always be taking into consideration of all these trends. Bangladesh, as of now, is close to about $50 billion. Most probably, they will cross that, but as I said, particularly, I personally believe that that particular country, the number of players would fluctuate. The smaller players or the fly-by-night operators or something like that who may not be very serious or who might have a good connection of customers and all might reduce the business or might go out of the business, so the stronger player will continue to become stronger and stronger. That's something that will happen. That's the kind of trend that I have seen over my last 30 years of analysis of the industry and the carriers. That is what continues to happen in Bangladesh, and I think we will be closely watching that, and we will be making use because we are in business of making money and doing business ethically. If this kind of criteria is being met, then why shouldn't we do that? Compared to India, India is a large country. I think what will happen to this particular industry of ours, our garment industry, the southern part of India, where we have states like Karnataka, Tamil Nadu, and all, if you see the factories that we are running there, a huge amount of population of the workforce has started coming from the north, from states like Bihar, Odisha, UP. So those are the people like migratory labor that we see very often out here. So I personally believe that as the industry should move into their home states, that would have a bigger rub. If you see even the geographic location or geographic area or the population, if I have to compare even Bangladesh with Bihar or Bangladesh with UP or Bangladesh with Odisha, that is possible. So definitely, what kind of policy, what kind of things have come up, how government is showing a lot of, at this point in time, a lot of interest. But fundamentally, if you look at it, Bangladesh is much simpler in terms of calculation and doing the projection because you pay a workforce, their salary, their overtime, and they have a good pension plan. Whereas in India, there would be a much number of other things that you have to take care of. So the complication goes up, but that doesn't mean that we can't do it in India. So yes, there is definitely the DA revisions and the wage revisions that are continuing to happen in India, and that's good to see. If I look at it, India is not very, very high compared to Bangladesh, but in terms of productivity, Bangladesh has proven to be much better. The efficiency, the productivity, the management, the whole ecosystem is much, much stronger because they're so much bigger. So these are some of the factors that we always look into as we plan. The other question that you had in terms of capacity, normally to set up a factory, if I have a building or if I have a shed to operate a factory, it should take not more than five to six months. Build a shed maybe about a year, maybe 14 months. So that's the kind of timeline that is needed to start from scratch. And what we do have is definitely we continue as a company, we continue to have a capacity built up for much more compared to what my requirement is. So if you see our utilization at this point in time is varying between 68%-75% in that region. In countries like Bangladesh and Vietnam, we can also utilize the outsourcing model or basically partnership factory where we take dedicated lines from other factories and we run it. So that's something also is possible in these two countries. In India, an outsourcing ecosystem still doesn't exist. So yeah, over the years, most probably our endeavor would be to develop this kind of ecosystem in India as well. Until that time, definitely we will see Bangladesh and Vietnam giving a much better performance compared to India. Thanks for the elaborate answer. So you are saying that basically till. Thank you, sir. May I request you to rejoin the queue for your follow-up question? It's not follow-up, just conforming. Okay. Yes. So what I'm saying is basically you are saying till 2029, whatever the economics of Bangladesh are very strong. I mean, for Indian companies to compete with Bangladesh would be easier. There is an ecosystem enhancement that is needed here. And for the new capacity, whatever you want to build, it would be easier for you to build in Vietnam if, suppose, anything happens in Bangladesh rather than in India because of long process or whatever. Is my understanding correct? No, no, no. A little bit of correction out there. India also, like we just mentioned, we are already going ahead with all our plans, and we just started the plan last year, so Bihar, Odisha, and Madhya Pradesh, we are going ahead and building up our capacities out there. So part of it would be ready and operational this year, and part will be operational next year. So definitely, that will be a sizable capacity that we are building up because these are the places where we also intend to do much larger capacity to be building it up, which is happening. Bihar, I think, is maybe a quarter or two away. Odisha, we have started in a small way already, and that's growing, and Madhya Pradesh, we have to build as of now. Construction is going to start, so India is definitely on the card. I mean, what I meant was Bangladesh has the advantage of tariffs at this point of time, which India doesn't have, and second, the higher productivity and efficiency because of the whole ecosystem in Bangladesh that exists, which is existing in Vietnam as well, so yes, so I think every place has got their own strength, and we will continue to utilize each location as per their strength for our strategy of putting up a much bigger business and better bottom line. How many million per business you are adding in capacity? That's my last question. So we can give that. So we have already in India all these three locations, once fully operational, would give us one, two, three, almost about five to six thousand machines per day. So that's quite a significant amount of capacity which we will have. So you bought that number because I see it is 46 million. You have the figure, right? I mean, capacity-wise from India. So how would it increase? I mean, 26 million, I think, yearly. We have already given that. So already, if you look at our plans to go to 150-140 million, and just talked about 10,000 machine additions. I think there will be added in a calibrated manner. There will be phase one and phase two which will get added. Overall, we are looking at almost 3,000 machines getting added in India with our plan which we have discussed. I think a number of this is a calculation we can share with you later in case you would like to know more detail. You can please. If it comes to push it, it's going to be about 5,000 machines, yeah. Thank you. The next question is from the line of Varun Gajaria from Boring AMC. Please go ahead. Hi, sir. And thank you for the opportunity. And congratulations on the big numbers. Am I audible. Yes, you are audible. Okay, so how is your order book piling up right now? How is it stacked? Order book is as per our plan. I think we are on track, currently on track. Okay. So what would be your guidance for 2025? Sorry, targeted. So we have already stated that we are looking for a growth, at least minimum of 12%-14% year- on- year, and with a better bottom line, double-digit. Okay. What is your knowledge of the quarter in Bangladesh at this point because we have heard some commentary from some of the Indian players that some of the orders were stuck in the last month. So how is it panning out there? I didn't get that part. You were saying that some other places you have heard that. What was it that you heard? That the orders that they are going to [audio distortion] to Bangladesh, they were stuck because of the crisis. So how is it panning out there? So we haven't faced any kind of problem in terms of logistics of moving inward raw material or exporting. After fifth, everything has been very normal. Okay. Sorry. So the impact of the quarter will be relative to June? There will be some impact, as you said, because of higher costs and loss of that, a couple of days of productivity. But yeah, not a very big impact. Okay. And how is the Indian ecosystem planning out? So inventory issues and everything is behind as of June? India, the last two months have been quite good. If you look at the total exports of India, it has been double-digit growth. I think overall for the year is still about, I think, 1%- 2% growth compared to last year. I think India should grow. I personally believe that India should grow by at least about a single-digit high number this year. How long do you think it will take for India to recover to its earlier export numbers? Just as a market overall. No, I didn't get that question. How long India to? How long do you think it would take for India to recover to its earlier numbers? We have been doing pretty good volumes for India also overall. So this is a general question. This is not about all? You're asking specifically about all or about? Just on industry goods. Industry. So industry, India has been exporting, and the highest export that India has done is about, I think, $16.1 billion. So this year looks good to become a better number. I don't know how much it would be finally, but yeah, it should be in the higher. But yes, you can see the concern that if you're talking about what's happening in other countries like China or Bangladesh, who would be there are a lot of forecasts there they should simply lose the market share. I believe China is definitely losing market share. Bangladesh may lose a couple of percent this year or may gain. I don't know how the rest of the year would pan out. But yeah, India to grow by about 10%-15% would need sizable amount of capacity. So we are doing our bit. We definitely are increasing quite a lot in terms of our capacity over the next two years that you will see. I'm sure the other players are also planning something to take this advantage of pro-India at this point of time. Okay. And how is the capacity? May I request you to rejoin the queue for your follow-up question? Yes, sir. This is just a follow-up question. Just the last question. Okay, sir. Yeah. Just wanted to get an update on the facility augmentation. How is that going on? How is the capacity addition going on? Would you mind me repeating the question you're saying? Capacity augmentation, do you have? How is the capacity addition going on? The whole plan? Capacity addition, see, one is augmentation. When you say augmentation, it is the existing facility in Chennai, which we already completed. It is under stabilization phase. And then comes the capacity addition, which is completely setting up a new plant, which is also, we mentioned, is underway in India and in a couple of locations, which is expected. Third one, the capital expenditure commitment will start happening in the next two, three months' time period. And also, for in a country like Bangladesh, after the evaluation, we will be looking to commit towards the capacity addition. So real capacity addition, commercialization will take time. But yeah, commitment towards that, I think, should happen in the next two, three months' time period. Thank you. The next question is from the line of Pulkit Singhal from Dalmus Capital Management. Please go ahead. Thank you for the opportunity, and that's a good set of numbers. First question is on the capacity utilization. I mean, we've seen a 35% YoY on volume front, and commentary is stronger for the second half. Are you already reaching that for peak utilization in some of the geographies? Are you expected to reach in the next two or three quarters? Yes. Thank you. Go ahead. So if you extrapolate the number which is coming up right now, I think we will be looking at somewhere around 80%-82% of the capacity on what we had in 83.9 million pieces as of 31st March 2024. Just simply continuing with the same trend if you take it that way. So there is a good headroom available still for us to really grow within that number also. But that number includes Indonesia and Vietnam, where utilizations are lower. So if you see Bangladesh, we were already at 80% utilization last year. India is at 65%. We want to grow 35%. Yeah. Our blended utilization last year was 68%-69%. With this growth, we see that overall, we should be looking at blended utilization in exports of these pieces. That's where we seem to be really getting with the revenue from the benchmark that we had from last year. Yeah, from the last year, and at the same time, as I just mentioned, we are advancing capacities at this point of time, so I think we are solidly in our plan, so we don't have any concern as of now. Understood. Secondly, on the whole Bangladesh viewpoint, I mean, last 15 years, Bangladesh has grown quite well in a certain meeting or environment with certain stability at the helm and certain policies in place. Now, with the new uncertainty coming up, our customers, because supply for you, it is 50% of your revenue. I'm presuming there are certain customers who are heavily dependent on Bangladesh for the majority. We are talking to some of these, I mean, talking about having to diversify away from Bangladesh over the next two years because I would presume that stability of sourcing would matter more to them than costing? Fortunately for us, we don't have any customer who are very heavily exposed to Bangladesh. There were certain Australian customers who have been working with us to diversify. And very successfully, we have done that over the last year with them. Apart from that, the U.S. customers that we have, they had some balanced exposure across all the geographies. That's something that I'm very closely involved with my customers' strategy teams as well. I don't see any immediate threat. Yes, there are a few customers, if you talk in general, who have been very heavily exposed in Bangladesh, and they would be moving out. That will give me more opportunity in the other countries. I'm seeing it as a win-win from both sides for us. Okay. But very last quick question on finance costs. It's roughly around something around 20% growth per quarter. I'm just trying to understand, which is roughly INR 90 crores a year. In your plans, when you think of it three years out, does your finance cost come down? Does it grow because your revenues are growing, or does it remain flat? The finance cost and the percentage of sale is, I think, roughly around 2.2%. I think as we go and incur CapEx also, there will be some debt we've taken. So we will follow the very prudent norm of 30-35, it could be a 60-65 debt. And then plus the rest of the thing, the factoring per share will continue. That means if the receivables and the top line keep on increasing, the receivable financing will be expanding. So in absolute amount, those number will keep on increasing. However, with the interest rate getting softened, let's say two, three, four quarters down the line, that will have a positive impact on the finance cost coming down. Plus, we have also done some repayment of long-term loan. We have sold in India non-core assets, because of which we have an exceptional gain of INR 5 crore reflected in our profit and loss account. The realization from that has been largely utilized towards the repayment of the long-term loan, which was at a high cost of 9.5%-3.75% in India. So approximately INR 15 crore that long-term repayment has been paid, which will help us in terms of reduction in the cost. So this opportunity of optimizing interest cost, we are very clearly looking at it. And as and when this opportunity exists, we will definitely work on it in further reduction. But overall, in terms of our strategy of doing factoring of our receivable, having a non-recurrent financing, that will continue. And we will definitely look at optimization of the working capital requirement, given the cash which will be generated from the operation, really see how best we can optimize our finance cost. And wherever there is a non- core asset realization, as we have done this year, we will definitely use the prospect for dischargement of the long-term loan so that our interest cost and the leverage also gets balanced in the process. Understood. Thank you for your honesty. Thank you. Thank you. Next question is from the line of Palash Kawale f rom Nuvama Wealth Management, please go ahead. Thank you for the opportunity again. Sir, my question is at least in Bangladesh. So if I had to imagine how was the scenario where situation doesn't normalize and clients are still in this, so how confident are you then to stick to your Vision 2028? So if you discount $50 billion of exports from Bangladesh, so then that $50 billion has to go to some other countries if you have to take your situation. So yes, then I think there could be good opportunity for all other manufacturing regions that we are. So yeah, it's a hypothetical question that you're talking about. So I think we are well poised. We are present at this point of time in multiple geographies and not heavily dependent on only one geography as a company. So I think that gives us that advantage. And yes, I think I personally, as I said, Bangladesh, I don't see will go away so quickly at this point of time. Maybe even let's say in $50 million, even you talk about 10%, it's $5 billion. So that $5 billion, if it comes to India, then I'm ready. We are ready to go for it. Similarly, in Vietnam or Indonesia, I think there's still an opportunity. So we can definitely take it up. Myanmar and other places I'm not very confident of. Central America would always be very small. Yes, there would be some movement might happen in the North African countries like Morocco and Tunisia and all. It's not a big change that will happen in the industry. Thank you for your answers and all the best for the future. Thank you. The next question is from the line of Bhavya Gandhi from Dalal & Broacha Stock Broking. Please go ahead. Yeah. Hi. Thank you for this opportunity. And I just wanted to understand that how long does it take to add a new customer and what is the time frame? I mean, is there any entry this year where other players also can add new customers or if you can shed some light on that? See, internationally, these kind of customers, they do have their own supply chains. That's kind of a list of much more of an established organization like Gap or Walmart or Target. So these are big lists that you have. So they have a very well-established supply chain for themselves. Generally, the entry barrier into these kind of customers is very high. So they would only change either if they have a strategic change. For example, we have been discussing what happens to Bangladesh and if they have to move something out of Bangladesh. So any of these customers have gotten overexposure in Bangladesh and they have to move to India. So then that could give them opportunity for a new entry to come out. Otherwise, generally, if they are getting into a new product or something where they have made a strategy into their product and they are looking for a particular kind of product to enhance that line, so then they would go for that kind of design and product, which this is the reason for which a company like Pearl, we have our design offices in the respective countries so that we closely continue to work with these customers. Generally, apart from that, if a new player comes in today, if somebody starts an export house or a company, so then the barrier is quite high because definitely for a new player to enter at this point of time would cause a lot of problems. And to start from any customer is not easy. And of course, there is an issue of getting into the social compliance, technical compliance. So the whole process at times to take a new factory, if it's a new factory, as I said, it might take about one year to construct and another four, five months to make it run properly. But to get through a compliance process also, this approval process of these international customers might take anywhere between three to six months. So these are some of the barriers that we plan for as we go for our growth, our strategy planning, our business planning. Sorry, sir. Am I able to answer your question? No. Actually, my question was on a different tangent. So what went right in 2020 that we were able to add so many customers simultaneously? So let me ask you in that way. I mean, because the same entry barrier is for us as well, right? Yeah. So you see, we came into the market by saying that we are a global player. Pearl, when I came into Pearl, there were definitely the other regions like Indonesia, Bangladesh, India, Vietnam. So they were operating. They had some customer base. When we did the evaluation of all the customer base, we found some of them may not be financially strong, may not exist maybe three or four, some kind of downturn if it comes in the Western market. They might get wiped off or get into a financial situation. So that's kind of the overall customer strategy at this point in time. So it's not that we got a lot of new customers just like that. It's basically we wanted to target certain customers. We started approaching them. We gave them the strategic solutions that they were looking for to their diversification strategy. And of course, that's the time China Plus One was playing an important role. So those are two, three things which really helped us to develop into this new strategy. And that's the reason for which, if you see at Pearl, we are in five different locations providing a global supply chain solution to our customers. We are providing them in-country design services. That means my design teams are working with their own design team in real time in their offices or in their locations. Similarly, we are a supplier which is not giving one or two kind of products. We are doing seven different kinds of products. So if somebody starts with one, then the cost of sourcing or cost of liaisoning and working with us is much more efficient because we are providing this multi-country, multi-product kind of thing. So that's the kind of strategy that we built up at that point of time, and we went ahead with all these customers and added some of them to our thing. Maybe in the past, Pearl was known to them. They have not worked together, but we could bring them up successfully and then continue to grow with them very successfully in these last four, five years. So what was the timeline to bring them on board? That is what I'm trying to understand. So once a customer is convinced, we do definitely tell the customer, Okay, these are the advantages if you work with us. So then if they have a need, then things can move very quickly in two to three months' time as well. But if they don't have a need, then the right opportunity has to be waited for at both the sides. So that might take even a year sometimes, and sometimes more than a year. Have you added any new customers in the last two, three years? I'm talking about four, five years, 2019, 2020. I'm just talking about the last two, three years. Yes, we have added, and some of them are growing significantly with us. Okay. Fair enough. And lastly, if I can squeeze in, are we seeing any early consolidation happening in Bangladesh? Ground-level consolidation. I understand philosophically, it may happen that we will see consolidation in years to come. As of now, on ground level, are we seeing any consolidation, early signs of consolidation happening on the vendor front? Not after the change of government, but it has been going on for maybe a year or so. But yes, it might accelerate now. So the customers that we cater to, is there any consolidation taken place as of now? Yes. Okay. So I can give you one example. Yeah. So one of our customers did acquire more brands and became from a financially weak company to a much stronger company at this point of time. So we are definitely looking forward to grow with them very well. Thank you. Ladies and gentlemen, we will take that as the last question. I would now like to hand the conference over to the management for closing comments. Thank you very much. In case of any further queries, kindly reach out to us or Strategic Growth Advisors or Investor Relations Advisor. Thank you very much. Thank you. On behalf of Pearl Global Industries Limited, that concludes this conference. Thank you for joining us, and you may now disconnect your lines.