Ladies and gentlemen, good day and welcome to the Q3 FY 2022 earnings conference call of PI Industries Limited. As a reminder, all participant lines will be in the listen-only mode. There will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference, please signal an operator by pressing star and then zero on your touchtone telephone. I now hand the conference over to Mr. Nishid Solanki from CDR India. Thank you, and over to you, sir. Thank you. Good afternoon, everyone, and thank you for joining us on PI Industries Q3 FY 2022 earnings conference call. Today, we are joined by senior members of the management team, including Mr. Mayank Singhal, Executive Vice Chairman and Managing Director, Mr. Rajnish Sarna, Joint Managing Director, and Mr. Manikantan Viswanathan, Chief Financial Officer. We also have with us Mr. Prashant Hegde, CEO of Domestic Agri Inputs, and Dr. Atul Gupta, CEO of CSM Exports. We will begin the call with key perspectives from Mr. Singhal. Thereafter, we will have Mr. Manikantan sharing his views on the financial performance of the company. After that, the forum will be open for question and answer session. Before we begin, I would like to underline that certain statements made on the conference call today may be forward-looking in nature, and a disclaimer to this effect has been included in the investor presentation shared with you earlier and also available on stock exchange website. I would now like to request Mr. Singhal to share his perspectives with you. Thank you, and over to you, sir. Thank you, Nishid. Welcome everybody, and thank you for the participation in the call today. I wish you all a very happy 2022. I hope you have overcome challenges in the recent year, and we are grateful to our frontline workers for their efforts in this pandemic. I'm also pleased to inform that PI has achieved an all-time high revenue and EBITDA in this quarter, with the revenue coming at 17% while EBITDA going at 8% and PAT grows at 14%. This expansion came despite a high base of last year and rising input costs. The domestic grew by 8%, while the exports grew a robust 19% in the quarter under review. We stand in the front line since we are the leading edge in complex chemistry. Our team are engaged in discovering better and more efficient pathways to commercial molecules for a global arena. Innovators across the world acknowledge this, and we have a number of inquiries from existing and potential clients and partners in a rising market. But transactions and new inquiries have continued, and significant number of inquiries are coming from non-agrochem space too, giving the opportunity to build our next core competencies in that area. We have acquired more than 8 customers, new customers during the 9 months, and there's a rich pipeline of more than 40 products which are at different stages being evaluated. More interestingly, more than 20% of these are non-agrochem. We are targeting to commercialize three new molecules in Q4, in addition to four molecules already commercialized by December, a total of eight for the year. We have commissioned new complex building block with the composition of flow and batch process of monomethylhydrazine MMH. This is an extremely complex chemistry and challenging the technology transfers and capabilities, and we are scaling up production, and our team is one of the few in the world who have been able to build this production capability and demonstrate commercial production. Another great achievement that we are proud of. Our domestic performance for the quarter was driven favorably by the agroclimatic rabi conditions, supported by price hikes effected by key products. We undertook successful launches of one of our new insecticides for rice and two specialty fungicides focused on horticulture and rice. We've also successfully launched a number of new brands in the horticulture segment with Jivagro, which continues to enjoy a strong standing, which with our key product positioning as well as category leaders. Moreover, over the 15 to 18 products at different stages of development and are going to get into registration. The idea is to further strengthen our market lines in the coming period, and some of our recent novel introduction continue to perform ahead of our expectations. Let me take you through a few of the examples in that. I'm happy to report that AWKIRA, the new weed herbicide, continues to grow from strength to strength, and the treated acres has increased threefold in this year. In fact, with AWKIRA, we're changing the habits of the farmer. Again, a strong concept selling that's being done for the first time ever in that segment at the pre-emergent herbicide usage. The other interesting is the launch of pheromone-based product, PB Knot, for the menace of the pest of Pink Bollworm, is another sustainable solution. We are working with public-private partnerships to answer the growing needs of this and have been able to demonstrate this performance, which has given excellent results over five different states in the country. Once again, our foray into specialty biological product, first of its kind, which has now been launched in India in the grape segment. It has given a great innovative product to the market in the grape segment, which is safe and prevents disease management for, again, one of the challenging pests, which is the powdery mildew disease, and enhances the quality and the luster and the shine of the product. Another great three launches which PI has brought some new innovative concepts into the ag market, which we expect over time to further scale up and to demonstrate our capability as a differentiated player in the ag segment. We continue to strengthen our marketing approach. Subordie has already a strong pipeline of brands working close quarters with specially dedicated personnel in pharma to enhance through better user technology and modern best practices. Our business outlook remains robust, and we are very confident of achieving the original growth guidance for the current financials. I would also highlight that we have refreshed the PI Compass. We set ourselves a clear direction and a mission to further our growth. We set the purpose of reimagining a healthier planet and our vision to lead with science and technology and human ingenuity to address the latent nutrition health needs of the planet. We are aligning the organization across various levels in order to achieve and drive the PI Compass. Our diversification into adjacencies through inorganic routes is our top agenda, apart from technology scale-ups. We are evaluating various M&A opportunities, both in India and globally, to zero in on a few which meet the objective of creating a sustainable difference in value proposition in alignment with our purpose, vision, and the values by which we want to run the organization. We have elevated our homegrown talent and leadership in alignment to meet the delivery and development agenda aligned in terms of our purpose and vision, both in the CSM and the domestic business. This rewards long-term business contributions, also helps drive a culture of meritocracy across all levels. Last but not the least, we are proud of our investor and customer accolades. As announced earlier, PI emerged in the top quartile company in the very first S&P Global Sustainability Assessment with an 82 percentile industry ranking. This ranking, with a gold star rating, with the 96th percentile rating of EcoVadis, a high score under the independent Together for Sustainability, the TFS assessment for global customer clearly demonstrates and predicts our ESG focus. The budget speech of our honorable Finance Minister on first of February unleashed a series of programs for benefit of agriculture and chemical export sector. We believe these long-term policy initiatives by the government of India shall further boost opportunities in the Indian agriculture. Agri inputs and pressure on the chemical manufacturers in India will help companies like PI in the further growth momentum as we move. With that, let me first thank all our stakeholders for their contributions for this quarter and wish you good health and stay safe. I, with this, would like to now hand over to our CFO, Manikantan, to share his highlights of our financial performance. Once again, thank you all for coming to participate on this call. Thank you, Mr. Singhal. Good afternoon, everyone, and thank you for joining us on the call today. I'll be summarizing the financial highlights of the company for the third quarter ended December 31, 2021. Please note that all comparisons are on a year-on-year basis and refer to consolidated performance. During Q3 FY 2022, we reported all-time revenues of INR 1,356 crores, a growth of 17% over the same period last year. This was driven by solid growth in export revenues by 19% to INR 1,076 crores and 8% gain in domestic revenues to INR 280 crores. I would like to highlight here that we have grown on a high base of last year, where domestic revenues grew by 26% and export revenues increased by 40% in Q3 FY 2021 over the previous period year-on-year. The trend of elevated input cost continued during the quarter, although we have reflected partial cost through by increasing product prices both in exports as well as in domestic markets. Full impact of price hikes will be reflected in the coming quarters. Our gross margin contracted by 49 basis points in Q3 FY 2022 to 46% due to lower export incentive and partial cost pass-through, among others, which negated the impact of favorable product mix. EBITDA increased by 8% to record INR 297 crore. The margin moderation came in due to increased overheads by 24%, mainly attributed to sharp increase in fuel and other related utilities costs, logistics costs, and one-off expenses pertaining to strategic initiatives. These one-off expenses are non-recurring in nature, and we expect our price hike to partially mitigate the cost increase in the coming quarters. Profit after tax improved by 14% to INR 223 crore, in line with our planned effective tax rate. Our balance sheet further strengthened during the quarter. Net sales to fixed assets ratio improved to 2.07 from 1.89 in March '21. Total CapEx for YTD FY 2022 stood at INR 228 crore. Inventory level was maintained at the similar level of the last quarter despite our supply chain disruption to meet customer supply schedules and continued operations. Company maintained its strong liquidity position. With surplus cash and net of INR 2,078 crore, including CWIP projects. That concludes my opening remarks. I will now request the moderator to open the forum for Q&A. Thank you. Thank you very much, sir. Ladies and gentlemen, we will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on their touchtone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we would also request you to please limit your questions to two per participant. Time permitting, you may come back in the queue for a follow-up question. Anyone who has a question may enter star and one. We'll take our first question from the line of Ankur Periwal from Axis Capital. Please go ahead. Hi, sir. Thanks for the opportunity. First question on the CSM side. You know, decent growth, given the high base as well on a year-on-year basis. Please correct me if I'm wrong, probably this will be the highest, you know, new product launch for us in this financial year. You know, considering the new client adds, which you highlighted as well, your thoughts on the incremental growth, maybe from a medium-term perspective, how should we look at that number? Yes. Thanks, I think when we start looking at the business, since we're already at a high base and looking at the growth, what is the good part is we've seen a lot of positivity coming in terms of the demand cycle in this area, and as you can see on high base. In the coming year, very clearly, we will be further looking to enhance our capacities in terms of both, by adding capacity in the existing facilities and also going ahead to probably start building the base for another MPP. We see a positive trajectory in terms of demand, both in terms of the existing business, in terms of new businesses which are coming. PI's approach of always ahead, investing ahead of time is something that is probably gonna drive our investments going to the next year, which should give a good trajectory going into the future. As you would appreciate that we are always focused on new generation products, and we are seeing some of the new AIs getting concluded in the demand cycle in our commercialization initial phase, which obviously will ramp up in time to come. Sure. Just a follow-up there, these new product launches, both for let's say, you know, YTD FY 2022 as well as what we saw in FY 2021, what should be the ideal timeframe for them, for us to see a scale up there? As in these will be contributing significantly to FY 2023 revenues or 2024? Well, as you know, the new products will take usually 3-5 years before they touch maturity. Some of them are interestingly also in the area of the electronic chemicals as we diversify our activities into different fine chemical areas. The maturity of these would be probably longer than 5 years. Yes, we would see a good substantial volume in 3-5 years. Yeah. Sure. Yes, Ankur. A second question on the working capital side. You know, I take your point in terms of, you know, higher working capital because of the inventory side. Even the receivables saw, you know, slight uptick there. Should we read too much into it or, you know, because the receivables days have been steady at around 70-odd days since last couple of quarters. Right. Like, what could be a new, you know, a number there to watch out for? I think that's a pretty steady number to watch. If I was to look at the area, it's an improvement over last year, as you would see. Obviously inventory cycles are high and, you know, that also goes to show which creates a greater balance between customer satisfaction. We've been able to deliver more than 98% of our demands to our customers on time, even with the challenges of COVID over the last two years and in supply chain disruptions. The inventory management optimization is done in a way to make sure that we can continue to smoothly supply product to our customer while augmenting our capacities. Yeah. Looking at the challenge could last another year, this could be a challenging play, but internally the company is also looking to say this is going to be a new normal, so how do we optimize here further? That's the approach that organization is taking. Sure. You know, my question was more specifically on the receivables side. You know, we were at around 80-85 days earlier, and we have seen that number coming down to around 60-70. But in the 9 months we are going back to that, you know, 70+ days on the receivables side. Is that the new number, new normal that we should consider? Yeah. I just wanted to clarify. Last year, DSO was around 16 and odd days and 31st of December 2020. Right now we are in 71 days. This is where we are, can say, as explained. Going forward, obviously these things slightly fluctuate, but it will be in the same level of 69-70 days it will be. Okay. Fair enough. Thank you and all the best. Thanks. The other factor there is, you know, if you are seeing this on the call on a blended basis is the, you know, some change in the business composition. Because the blended revenue is exports and domestic, and as you know that the receivable cycle in exports is shorter than the domestic. Now, since the share of exports is more, in the current year vis-à-vis last year, you see this change. Sure. Makes sense. Yeah. Thanks a lot for that. Thank you. Thank you. We'll take our next question from the line of Bhavesh Jain from Kotak Investments. Please go ahead. Thank you for giving this opportunity. First question on this Agrochem CSM, how do we see the growth over medium to long term, considering few of our key molecules are going off patent over the next two to three years? I mean, you know, obviously, there has been a certain challenge in the regulatory area for getting new registrations. As you would see, we have been launching 4 new products coming in the coming year. Are you talking about CSM or you're talking about domestic, sorry, domestic? No, I'm talking about export CSM. Okay. I mean, see, generic or no generic, as you see, the contract manufacturing business is always working on the area of cost-benefited arbitrage, so there is no pressure on the manufacturing cost which could be driven from there. On the other hand, as genericization happened, and you would have seen that for any molecule, the key molecule inventor continues to hold a premium market share and price and continue to grow the market share. As you would see, we see this not as a pressure, at least for the next 3-5 years for these molecules because the genericization cycle in some of the geographies in time and some of the geographies which are coming also offer data protection, which further continues to do that. On the other hand, our own ability with experience in terms of cost efficiency and 10, 15 years of these molecule experience in manufacturing, I'm pretty confident that we are the best cost structures in the world in some of these products as we continue to go ahead. Okay, the second question on this pharma CSM piece. Post Isagro, are we actively looking for more opportunity, and whether we can build this business organically, and scale up much faster or inorganic will be an imperative to scale up this pharma CSM business much faster? Definitely we are looking. There's no questions on that. I think now the hunger is what is bigger because we need to catch up with time. We will be looking at this place in both organic and inorganic. On the other hand, I must mention that while we will continue to invest to look at the areas for an organic opportunity, we have got a team, I mean, R&D with the dedicated resources, and I'm building out the R&D capabilities further in terms of infrastructure, which have been worked on certain identified products which are the non-GMP space. On the other hand, we should be also augmenting one of the existing assets to do the pharma intermediates in this coming year so that we continue to do organic. As you would appreciate, we want to do something substantial and pretty quick. The organic pace is the way it is, which is continuing. The inorganic action is what we want to accelerate the process and more so get closer to the opportunity that we're trying to achieve, what we're trying to do earlier but in a faster pace without losing the time dimension, which is pretty lost. We are looking at opportunity in that line. Okay. Sir, I have more questions. I will come back in queue. Thank you. Thanks a lot. Thank you. Our next question is from the line of Vishnu Kumar from Spark Capital. Please go ahead. Good afternoon, sir, and thanks for your time. On the pharma inorganic acquisition, would there be an outer timeline by which we can expect you to close something like two quarters, three quarters? Is there something, an outer timeline that at least you can give us? Vishnu, thank you for this question. I would like to do that as soon as possible. We're looking, but we got to make sure that we get the right bite, right? Sorry. Obviously, I'd like to have some action moving obviously within the year. In next few quarters this or? I'm sorry, sir, I'm not able to hear you clearly. I said, you know, we would like to move this as soon as possible as of yesterday. Obviously we're looking on an aggressive pace, and we would like to have something moving in the next few quarters for sure. Got it, sir. Sir, just wanted to confirm. You mentioned Monomethylhydrazine, and also you also mentioned about some non-agro products that you're looking into. Firstly on Monomethylhydrazine, wanted to understand what is the opportunity, what is the growth potential, if you could give us some insights on it. Secondly, on the non-agro products, when we are scaling up, would it require additional CapEx? Or how should we look at the CapEx and growth trajectory on this side? You see MMH in any case is a backward integration strategy, and we're also looking at certain core intermediate blocks, which is further giving us the cost arbitrage and a risk mitigation plan backed with the opportunity to have certain revenues and scale growth in certain intermediate blocks. But the interesting factor is unique of its kind in terms of the molecule, the process technology that we work is a combination of flow and batch, so it gives us a new capability enhancement of dealing with hazardous products and science. In regards to the obviously the CapEx, as you know, we have put some aggressive capital over the last two years. As you've seen, that we've also looked at 15%-20% capacity enhancement through operational excellence and efficiency. The footprints of the MPP 10 is fabulous. It's 30% bigger than any of the other MPPs. This revenue growth plan is going to be driven by that. Looking at what we see coming in, we are looking at two prong investments, which we will probably come to you post next quarter as our business budgets and all gets approved, that we're looking to further get into putting up another MPP, and on the other hand, we're also looking to augment one of our assets and upgrade it to the pharma intermediate space so that we have the organic play which we are planning to do into operation by the end of the year. Understood. This Pharma, organically, what is the revenue potential that we could possibly reach by next year or maybe one or two years that we are currently working on? That'll be too early for me to comment. We are at different stages of evaluation, right? We are maturing and working on this. We will come back with a better understanding in the next couple of quarters. Got it, sir. Thank you. One suggestion, the voice is very unclear. Maybe I think you're speaking in the speaker. If you possibly change, it'll be useful. Thank you. Is it better now? Somewhat, but better. It could be much better. Okay. Thank you. Our next question is from the line of Rohit Nagraj from Emkay Global. Please go ahead. Yeah. Thanks for the opportunity. So, we have mentioned that we have partially passed on the price increases. Now, given the cost pressures that currently we are facing, we'll be passing it on in Q4 as well. In case of retreating of the input prices, what generally happens? Because there is a lag in terms of passing on the price input cost increases. Whenever the input cost again decrease, then how does it work for us? Thank you. Well, it's the same cycle, no? It works one way or the other way. Mm-hmm. Typically we have the inventories and the time to which our orders are committed, so that's less of an impact than the inputs, so that kind of works out in the same way. Right. Generally, it is about three months in terms of the lag effect that comes into play on either side? It takes, yeah, quarter. Depends on the product and output. Yes, quarter or so. Depends on the inventory levels. Yes. Typically, that's the average time you can look at. Yeah. All right, sir. Thanks. Now, sir, the second question is on the balance sheet. We have borrowings of close to about INR 300 crores, and we have a cash surplus of about INR 2,300 crores. Any specific reason to keep those borrowings on the books? Mani? Yeah. Thank you. It's from ECB, which we have taken up couple of years back that is, with an average maturity of five years. It's continuing in the books. It's beneficial comparing the rate at which we have taken at that time. We also evaluated the same thing and find that it is still worth to keep the ECB on our books. Right, sir. Got it. Thanks a lot and best wishes, sir. Thank you. We'll take our next question from the line of Madanagopal Ramu from Sundaram Alternates. Please go ahead. Good afternoon, sir, and congratulations for the very good show on the CSM business. Sir, you mentioned on the Monomethylhydrazine capability coming in. If I understand, it is going to help us to become more cost competitive for scaling up the existing products, or is it improving our capability to say, synthesize more new molecules? It does both, to be honest. Benefits of this are likely to come in the medium term or do we have to wait really three to five years? This is not gonna give us revenue of Monomethylhydrazine. We're looking to get revenue for the products that we have in the pipe. Yeah. That's what I'm asking. It's in the molecules already commercialized will see the benefits of this coming through. Some of them and some to be. Okay. Okay. Apart from Can you also mention about? Yeah. Apart from costs, this also de-risks the availability of material. Yeah. You know, on time. Because so far this was being imported mainly from China, okay? As you know, given the current scenario, this is you know, a strategic move to de-risk from that source. Okay. The second question I had was, you also mentioned about the flow chemistry getting commercialized. Can you elaborate a bit on what that would enable us in terms of scaling up the existing molecules? You mean flow chemistry? Pardon? You also mentioned about the flow chemistry getting commissioned, commercialized this year. What kind of advantages that will throw us? Yes. The flow chemistry is a capability development the organization is doing, which will look at the asset structures in a different way. We are looking to commercialize one of these areas, and that will give us the confidence to look at a different way to get a return on assets with time. Basically this will help in two ways. One is that this will dramatically reduce the plant's footprint, which means that the capital efficiency, which is the key objective, you know, long-term objective of ours in this business, that will be greatly achieved. Apart from capital efficiency, I mean, even the cost of production improvement, cycle improvement, all those benefits. Safety. Safety, I mean, these benefits also will be achieved. Basically, it leads to enhancement of capacity in the existing facilities. Capacity, cost efficiency, and also safety. All three core objectives, yes. Okay. See, can you put on the CapEx for the current year and also what kind of CapEx budgeted for the next year? If you can guide us on this. Well, we've not frozen the CapEx for next year, but Mani, for this year, can you please give that information? We have CapEx of INR 228 crores up till now. We expect, as we spoke in the last quarter call, around INR 300 crores-INR 350 crores would be the ballpark CapEx for the year. Okay. Thank you so much. Next year's CapEx plans are still in discussions in the making because there are several factors including the pipeline, some of the inorganic opportunities that we are evaluating. You know, I mean, the finalization of next year's CapEx will only happen by end of this quarter or something. Sure. Thank you. Thank you. Our next question is from the line of Aditya Jhawar from Investec Capital. Please go ahead. Yeah, thanks for the opportunity. Congrats for reporting strong growth in CSM. The question on CapEx is, you know, got partly answered, but, you know, one thing just wanted to understand that, organically for us, if we have to think about CapEx for 2023, 2024, in the order of magnitude could it be 20%-30% higher or much higher than that? Any broad sense on CapEx for 2023, 2024? Yes, if you want to look at that, but at the same time, I want to highlight that we also work on technologies to improve asset utilization as we've already seen this year. We have other plans to do that. That is why I think what Rajesh mentioned earlier, we're still looking at the technologies and balancing between risk and rewards and putting up a CapEx plan. Clearly we see a positive trajectory in looking at the CapEx depending because we are seeing a project trajectory in demand. As you would appreciate that over the last two years, we had aggressively put in CapEx because, you know, typical of need for building capacity before demand. I think that's what's supporting us through this process. Yeah. Yeah. That's encouraging to hear. You know, broadly, if you can get a sense that what is the line of sight of improvement in asset turns that we can expect in the next, you know, two years by the, you know, so many projects that we are doing. How much upside we can see from the asset turns from the next two years? This is again a chicken and egg story, to be very honest right now. Because on one side, if we are getting inquiries from time to time, you know, in this business, you can't build an asset just for the revenue. We'll have to build capacity based on a 3-4-year with visibility, right? Yeah. The investments sometimes go up front, then you get those peaks and troughs. Obviously the objective is to improve this efficiency. In the next two years, looking at what we see in terms of surge in demand, in terms of capacities we may build, I would see marginal improvements here, not something substantial to be really taking down. Yeah. Yeah. Follow-up, final. We have seen some improvement in this year, in this quarter also, as you have seen. We are confident that, while yes, on both sides, on one side, commercialization of new projects happening, building of new capacity will also happen. On the other side, we are also kind of, you know, implementing some of these technologies to improve the, you know, efficiency, plant efficiency throughput. Combined impact will come difficult to, you know, quantify that as of now, but the direction is very clear that capital efficiency is gradually going to improve. The final question, you know, if we have to break the current CapEx, that is about INR 300-INR 350 crore for FY 2022, into, you know, the maintenance CapEx, the CapEx for backward integration and growth CapEx, you know, roughly what could be the breakup? Mani, you would have that. Have it ready and I have to come back. Normally we don't give such break-up on the CapEx front. Fair enough. Just one part that just if you can give what could be the CapEx for the backward integration. That would be sufficient. Yeah. That is not significant because some part has already come earlier, some part has come within this quarter. I think not more than INR 60-70 crore or something. INR 70 crore for FY 2022? Yeah. Okay. Perfect. Thanks a lot, sir. All the best. Thank you. Before we take our next question, we would like to request participants to please limit their questions to two per party. Our next question is from the line of Abhijit Akella from IIFL Securities. Please go ahead. Yeah, good afternoon. Thank you so much for taking my questions. Just a couple of clarifications. One is, if it's possible to share the Isagro export revenues for this quarter and for the nine months. That would be helpful. Thanks. Yeah. Mani, you would have that, or you will share what? Separately? Isagro. Isagro export revenues we'll share separately. Please. Sure. I'll do that. Okay. Thank you. The other thing was, just to, you know, confirm that, we've talked about this 20% kind of CSM growth target for the next few years, with good visibility. We are still on track for that. On the domestic side, what kind of growth would we expect for next year? Also if you could just comment on the margins, is it possible that we could see a recovery next year after low base of this year? Yeah. I mean, as we projected, the growth rates are looking to be in the same direction. Obviously, ads will also catch up the growth rate as we expect it to do, far better than what we've had based on the launches of products and new products coming to registration. We see a good year going forward. Thank you. One last thing. Isagro, you know, sometime back in December, put out an announcement saying that, apparently PI has approached the commercial court at Gurugram, you know, for some kind of arbitration and conciliation. If you could just, you know, confirm whether that is the case and what is the update on that and what do we sort of, you know, plan for that discussion going forward? Yeah. Abhijit, since the matter is sub judice, I think it will not be correct on my part to kind of put any commentary around it. Yes, some proceedings are happening on that front. The idea is, you know, that we're still sort of trying to see if, you know, a deal can happen there. Is that the thought process behind that, or? No, this is what I said, Vijay, that since the matter is still recent, there are certain proceedings, legal initiatives taken by us. I think it is not correct on our part to kind of put lot of details and comments in here on the call. Understood, sir. Yeah. Thank you so much. I'll come back. Thank you. Our next question is from the line of Bharat Shah from ASK Investment Managers. Please go ahead. Yeah. Two questions. One on talent management, retention, nurturing and growth. What are the thoughts, strategies and ideas? We have seen over a period of time kind of a recurrent separation of talent from time to time. Yes. You know, as you've seen, Bharat Shah, that we have just now put a whole strategy of development, deliver agenda for putting a new purpose and vision and strategy to put the whole talent map together. Clearly the organization, looking at the objectives it needs to achieve, it looks at talent and talent management approaches in line to that. As you would have seen, certain talent was acquired in order to help and augment the organization to grow and move to the next level. While we internally have been able to develop the new talent which has come and shaped with the leadership of the two leaders today, having vast experience to drive the future strategies and growth. As a constant drive, we have taken many initiatives in this area, and we are continuing to grow in-house talent in line with the competence and capabilities required for the future growth as which has been defined and described by us through operating business model. Mayank, your voice is not very clear. If you can speak closer to the mouthpiece or without the speakerphone, I think it will help. Are we kind of happy about our initiatives, or is it a source of concern, given a fair number of departures that we have seen? Well, I'm not sure that what level of departure that we're talking because some have been retired, some have moved on because of a certain data. We have enough talent in-house which has taken up charge and shape, which was developed, which is there. If I still look at the data points, PI attrition rates are far lower than the industry average, which is being faced in today's growth opportunities that industry is operating, right? At the same time, we are looking to always with today's world is a little different world of the youngsters. The point is that we are working on a strategy where we have well mitigated risks from talent by developing talent internally. Most of these positions and growth rates have been taken internally, and we continue to invest in building talent and acquiring certain talent back in alignment to the strategies of business areas that we want to focus for our growth. Yeah. Okay. My second question is going back into the past and projections for the future. Four years back when we were discussing, we were saying that in five years' time we should be a $1 billion-dollar business and capital efficiency to be in the 30s% is written on capital employed. A $1 billion four years back meant about INR 6,800 crore or thereabout. Are we on the way next year to be around that ambition and on capital efficiency the objective of in the 30s% rather than 20s%? Correlating to that, if we have to thereafter think of our business, whether in three years, four years or five years' time, we believe given initiatives, given client engagements, new chemistries in our product offering basket, are we likely to see the business doubling, whether 3 years thereafter, four years, five years then? With that, Bharat, for that question, you know, we're not an organization that likes to be asleep. We want to grow at an aggressive pace. Clearly, yes, we want to deliver that. I'm pretty confident that given the energy, the drive of the team internally and a passion to grow in the areas of our competencies, the areas of technology, more importantly anchored with the ESG framework and sustainability, we don't see these kind of challenges, obviously, with both organic and inorganic to achieve the objective that we have set out for ourselves. We'll continue to do that. Obviously, as we look at what Siddharth questioned of me today, if we didn't have one of the M&A opportunities, we will be well there in that number. Well, we are looking for other opportunities. What stops us to not getting to that number which we set ourselves out to achieve and what we are looking to do in the next four to five years, we would like to be more aggressive in order to get to the space faster. That's what we're building the organizing resources. We've already deployed a large number of resources in the areas for growth opportunity and diversification. The reason why I'm asking this question is opportunity probably has never been better for India in general and more specifically for PI, given the kind of favorable position PI has put itself into with research-driven chemistry and foraying into allied branches, as well as client relationships and global affinity for India-based quality specialist players like PI compared to the other competition in other parts of the world. Therefore, I mean, time to get more ambitious probably has never been tomorrow. Probably it is yesterday. I would have thought. Yes. You know, ambitions are never going to die, 1. 2, as you rightly said, technology may be key. Technology is not really sometimes changing the long tail, with steps of differentiator. When you get to that tail, it has to give you a spike. As you see, PI is working the discovery area, and this is a long tail. Therefore, we are not giving up that and nothing like the opportunity that India today has to offer. We are looking at technology capability which is going to be more globalized rather than localized and opportunistic in nature. We are still. We've not left our path. As you know, we've set our path and we're moving up the value curve. As we mentioned, we're focused on the discovery area, and we're talking to global partners on the development front, which puts PI in a completely different technical competence capability compared to any of its competitors in that scene. On the other hand, our chemistry capabilities, which are being leveraged across the other application areas, would also augment our strengths and also widen our offerings to a different basket of customers and yet create a larger differentiator and cover some of these areas. We are pretty clear and confident this would give us the next kick up of growth. It takes the base foundation to become strong and when you're developing technologies, but the kick up started pretty well. We're pretty confident we are well on the way to do that. Sure. Thank you. The Make in India initiative is well positive, but our idea is to make in India for the world with a differentiator to say that there is the best of technology and the best of cost. We are focusing on both the mandates here, not versus lever of cost today or the opportunity the landscape is offering now. Sure. Thank you. I continue to be an admirer, and well-wisher of PI journey so far. I hope that is the way it stays. Thank you. Thank you for your wishes. Thank you. We'd like to request participants to please limit your questions to two per participant. Time permitting, you may come back in the queue for a follow-up questions. Our next question is from the line of Tejas Sheth from Nippon India. Please go ahead. Yeah. Hi, good afternoon. On the, as we continue to pursue the pharma CSM space through inorganic route, what is the aspiration for us to have, the revenue from th e same over next three years, organically? Hello? Hello. We didn't get your question. Sorry. Can you go back to that? The question was on the pharma CSM. Obviously we are pursuing the inorganic route on that segment. What will be our aspiration from that segment over next three years on the revenue side organically? Organically. Well, right now it's a business contribution, but obviously it's been the INR 3 billion which we are very, very looking to see. Otherwise it's not gonna be substantial enough for PI to chase. No, just a clarification on that. Even if we don't acquire any asset, are we looking at INR 1,000 crore of revenue potential over next 3 years? That would be INR 1,000 crore in pharma, my friend, is a pretty large revenue which will not be possible organically to do very straight in three years. Yes. No. No chance. Obviously, INR 150 crores, we are looking at the area of, you know, intermediates non-GMP. The organic route is where we're gonna leverage to build that revenue in three years. You can't get that number in inorganic way. In organic way, sorry. On this Agro CSM side, I mean, if you see four years ago, I mean, there were only three, four players which were very key to the innovators. As we see today, there are many players and most of the business now is done through RFQs rather than on relationship basis. Are you seeing intense competition on CSM Agro side? Well, I'm not sure about what you mean by RFQ in this because it depends on where you are. Number one, yes, there are many more players. The landscape will importantly expand as business will expand and as the first movers. Again, which part of the pie? Because there are also outsourcing which is moving from China to India, which could be also in the generic space, which could be for products which companies are already making. Intermediates which companies are making and are getting business opportunities which they were uncompetitive on cost in the past. Clearly for new generation with product development, I have not seen the RFQ approach really happening. It is still based on competencies, capabilities and partnerships of trust which are taking that game. That definitely have a role to play, and specifically where they see that they are looking for continuous improvement to deliver efficiency and cost. Obviously competition is gonna come and will come, but the point is what are we doing and what we continue to do to be ahead of the competition. That's where we have our capabilities in the area of technological build-ups. What we see in the new generation products to offer value to our customer. That's where it is right now. Got it. Yeah. Thank you very much for answering. Thank you. We take our next question from the line of Khushi Doshi from Axanoun Investment Management. Please go ahead. Thank you for the opportunity. FY 2021 annual report mentioned that 46 new molecules were synthesized during the year, out of which 20 were scaled up and 6 were transferred successfully to the next stage. Five molecules were commercialized during the year. My question here is what is the% of molecules that are commercialized for the company from the total molecules synthesized? It would be better if you could provide last year's as well as five years' average numbers. Thank you. Well, to be honest, we don't have them with us right now, but typically it's a funnel. The funnel of commercialization, because some have pre-registration, five-year registration periods, or some even have short registration periods. Nothing gets commercialized from an inquiry to commercialization less than two years. That's a typical timeframe for producing samples, approvals, pilotization, further approvals, regulatory work if that is applicable, and then putting up facilities or optimizing facilities for production. Okay. Could the number be provided any time later? Yeah, we can get somebody to put that to you. Thank you. Thank you. Also, could you shed some light on what type of electronic chemicals the company is working on? Well, we can't put detail onto that. As you know, we are bound under very strict confidentiality clauses with our partners. Yes, we are working in that segment. Again, they are in the innovative area. Okay. Thank you. Thank you. Our next question is from the line of Sumant Kumar from Motilal Oswal. Please go ahead. Sir, can you talk about the AWKIRA performance in this quarter and what kind of target we have for this product for next two to three years? Well, the performance, I would say, as we highlighted, the performance of the product has been very highly satisfactory actually. We're very well overwhelmed with the kind of performance. More importantly, this has been done because of the excellent execution and hard work of our team, who have done a phenomenal field work activity for concept selling, which has shown us a 30% jump over last year. Clearly, the way I see it, going into the future, it's competitively sensitive, so we definitely are very gung-ho, as I would say, about aggressive growth plans on this product. Not only that, but we have a bunch of 2, 3 new other molecules which are coming in, which we would see a huge shift in the way we see demand in the domestic sector. Do we have any target of some particular numbers we are going to reach in maybe a couple of years? I would not like to highlight that for, as I said, for competitive challenges purposes and also. Okay. Yes, as I said, we have very good aggressive growth numbers, and we are confident that that can be done. Yeah. Okay. The product you have launched, PB Knot, can you talk about the potential target overall, what kind of growth potential and in this product? Prashant, maybe you can give some inputs on the PB Knot and how you see this as a social program. Maybe Prashant, are you there? Hi, good afternoon. PV Knot is a novel technology which we are basically widely testing at this point of time. This year also, it has gone through a lot of testing and trials, commercial trials. We are hopeful to commercialize this in the coming year in the cotton area. This product is a pheromone-based technology, and it is basically tied to the plant, and it has to be a community approach which farmers have to adopt. That is why we are also working with various communities, various FPOs and the government organizations in Maharashtra and Punjab as well. Because it's a novel insecticide, it is a new approach which you have to follow and a community approach. It is going to take a little more time than the regular insecticides. It is a good product, and we are hopeful. At this point of time, there are no other products which can give this kind of control on PB Knot, which this product can give. Because of the community approach which we need to follow, so it is going to take a little more time to scale up. It is going to be a sustainable product and it is a long-term product. That is how I can put it. Just one more thing I would add. Pink Bollworm is a pretty menace in the cotton belt, and there is no other solution. This is again a unique concept selling, where we need a huge amount of public partnership and participation to make sure that the farmer is able to see the benefit. I must say there's a huge interest which is being shown by various state governments, and they have to say that how PI can partner to put this concept into the market. I think the positive outcomes have been very encouraging to the extent that we have been able to socially make an impact of this product and make sure that the farmer is able to get a better crop yield and not get damaged by this pest called the Pink Bollworm. Is it a licensing product? Sorry? Sorry, what did you ask? Is it a licensing product? No, it is our own registered product. Yes, obviously we partner with a Japanese company, but we have a exclusive license for India. Okay. Thank you so much. Thank you. Our next question is from the line of Surya Patra from PhillipCapital. Please go ahead. Yeah, thanks for taking my question, sir. Just on the given commentary on the flow chemistry side, what you have mentioned, there is cost efficiency, OpEx efficiency as well as CapEx efficiency driven by that. Is it fair to believe that going ahead, whatever CapEx that we would be planning, that would be largely based on that? If that is yes, then what technological challenges that you could face in developing the processes for the flow chemistry technology? Ladies and gentlemen, we request you to please remain connected. It looks like Mr. Singhal's line has dropped out. We'll just reconnect him back. Please hold the line. The call will start shortly. Ladies and gentlemen, thank you for your patience. We have the line for management connected. Mr. Patra, we request you to please repeat your question. Yeah, thank you. Just I was asking about the flow chemistry, about which that you have commented that, this is going to have both, OpEx efficiency as well as CapEx efficiency. Going ahead, is it fair to believe the largest chunk of our CapEx will be driven by that? If yes, what challenges that one would see in developing the processes to fit to the flow chemistry? I'm not getting your voice very clearly. Sorry. You talked about flow chemistry. The other part was muffled before. Okay. Hi. Is this line correct now, sir? Maybe you can put a bit further away because the voice is cracking. Okay. If you talk further away from your phone, maybe it may be clear. Okay. I was asking that, sir, since we have talked that, and that is known that this flow chemistry, if it is implemented right, then it can offer both CapEx as well as OpEx efficiency meaningfully than the batch process. If that is the case, then going ahead, large part of our CapEx would be driven by that. Well, let me put it this way. It is number one. It's a flow chemistry, the concept which has been around for a while, which is now getting some people looking commercially. It is not that it can replace batch processes. It is not something that in all chemistry, in all kind of areas this can replace. Yes, in certain critical areas it can replace, where it can give both operational excellence and also can give you safety and a capital cost structure. PI's building this capability and looking at certain of the areas of opportunity that we have, where we can actually bring this value offer to the table for the company, right? Once you build this capability, maybe we can drive more project and strategy aligned to that. Yeah. My second question is on the kind of new areas that we have been talking about, sir, whether it is the fine chemical one or the pharma one or like that, or the electronic chemicals, what we have already initiated something. Let's say on the three-year time period horizon, what is the kind of revenue mix that we should be seeing out of non-agro base? Also if you can add to that in terms of customer composition in the CSM side, for the non-agro base, what is the composition it would look like three years down the line? In the organic way for three to five years, you could see about 15%-20% of this. Because we're looking to continue to grow on that big base there and also at the same time, it's best to catch. Yeah. Okay. Same is the case even the customer composition? Yes. Okay. Just if I can add in here, like, what is the current base of our agro CSM customer base? And what is the potential target customer base? Means whether we have enough scope to add more customers to our customer base or something on that front also if you can add. Well, there's always a scope, but I think you're covering most of the customer bases in that, where we are focusing on the products in the custom manufacturing point and looking at the pipeline working along with them. Yeah. Sure. Thank you, sir. Thank you. Before we take our next question, we request participants to please limit your questions to one per party. Our next question is from the line of Rohan Gupta from Edelweiss. Please go ahead. Yeah. Hi, sir. Good afternoon. Sir, slightly in line with the previous question only. Sir, we have been leading player in agrochemical CSM and among the probably first player to enter into that business and have done extremely well. Somehow, sir, probably we have not been able to scale up our capabilities in other segment in non-agro, whether it's pharma or probably in newer segment. Sir, do you think that there are limitations that from agrochemical players it's challenging to get into other businesses while other chemical players probably who are non-focused, non-agrochem focused are probably able to scale up their capabilities in other segments? Is it a limiting factor, sir? Well, I don't think so that at all. I think we've focused on something and achieved height in that very clearly. As we said, we're now focusing on the other segments and going at it. Pharma is very clearly defined strategy. Okay. In the short term, we've had this challenge of this M&A opportunity, but I don't see that as a challenge. It is more about. Getting it done. That's where we are. We see the opportunity in the other areas which is already entered. Obviously, you would have seen that the CSM business that we have been able to achieve has not happened overnight. It's taken 25 years, 20-25 years to get to where we are today, right? It takes time, and if you want to focus strategically in the right space, and some of these we've initiated long ago. I mean, if we talk today about the non-electronic chemicals, we're talking about for now 3-5 years. In the last 3 years, we've been working on it. Eventually, now we've got commercialization, and we see a good landscape coming up over the next 2-3 years. This is what it takes in this business. Sir, probably in a product like electronic chemicals and all, once we open the opportunity, can we expect there'll be very fast run-up in terms of revenues and growing possibilities, and it can also add more customers? Will this product be patented or will be our proprietary product which can be offered to many other customers? No, no. We'll be working with custom manufacturing approach there. We're working with proprietary products that we may have some proprietary capabilities that we could bring in. Yes, we will see. It will take time to get in, and it takes time to build capability and credibility in a sector. Once we're able to do that, the multiplier effect starts coming in. Thank you. We'll take the next question from the line of S. Ramesh from Nirmal Bang. Please go ahead. Yeah. Thank you very much, and good afternoon. Is it possible for you to tell us what is the kind of capacity ramp-up we expect in the two MPPs you have started in the first half of the year? Well, I'm not sure about the capacity ramp-up, but they're multi-product plants, so each product has a different capacity which it produces. Right now they are in the process of their augmentation of the capacity, and their ramping up will take, obviously. It can take up to two to three years really when they get to the full capability. Because one is getting the capacity as per the demand moving in for products that we put in. Second is also learning and improving the efficiency of the products that they're producing. It takes 3-4 years before the whole plant starts giving full capacities from the multi-product approach. Yeah. The second thought is in terms of your CSM business growth. Is it possible to share with us any incremental inflows in your CSM order book? Because you have indicated a decline from $1.5 billion to $1.4 billion. How do we read that? Is there a reduction in the annual order inflow? Are you getting the growth from the annual business that you do? Well, given the way challenges are today, we are not looking at order book as a key driver because, you know, we are regulated, the registered product producer for these companies. It's taken multiple years to develop. Order book and risk of that is minimum for the old business moving out. We are more focusing on the quality and the content of the business, followed with the volatility which continues in the market. Rather than getting to order books, we are more focusing on stickiness creation with the customer, and then get into quarterly or monthly or half-yearly or yearly negotiation based on the movement of prices rather than building order books. Okay, sir. Thank you very much, and wish you all the best. Thank you. Thank you. Our next question is from the line of Varshit Shah from Veto Capital. Please go ahead. Hi, sir. Thanks for the opportunity. Sir, my question is on the margin side. Mr. Shah, sorry to interrupt. Is this better now? Yeah. Now it's a little better. Please go ahead. Thanks for the opportunity. My question is on the EBITDA margin and higher SG&A expenses. I think we have some tailwinds coming from increase in the utilization levels of our existing assets. Given the cost pressures and one-off, can you give us some color on how much of the SG&A expenses had a one-off element so that we can understand how much impact came from the inflation? Coming to the, I mean, there are two, three parts to your questions. Coming to the one-off in this period has been close to, you know, INR 20-odd crore in this period of nine months. The other reason for this increase that you are seeing is also the fact that, you know, the fuel cost has gone up quite substantially during this period. That is another factor which is reflecting in these percentages. Another factor is that because the last year was, you know, majorly impacted by COVID and some of these expenses, for example, traveling and, for example, a couple of other, you know, expenses, they were at quite abnormally lower level. Now that this year's activities have, barring a few months, been normalized, those expenses have again gone back to the earlier pre-COVID levels. Yeah, I mean, these have been some of the factors, but in a nutshell, one-off kind of expenses were close to INR 20-odd crores during this period. Sure, sir. That is helpful. My second question is on the agro CSM side. One of our large molecule for a U.S.-based customer is going off patent. Do you envisage a scenario where the CSM business for that particular molecule from other international players and domestic players actually throws up a good volume growth opportunity for us? Given that they're already ahead in the cost curve for that particular molecule. Well, I'm not sure which molecule you are talking. It's one of the top two. Let's put it that way. Pardon? It's one of the top two. We've not talked about that. No. Can you- Sorry, sir. We can't hear you, Mr. Singhal. Yeah. I was not sure what is that question, but if you can please repeat the last part of your question again. Yeah. I'm referring to one of the top two molecules which we do in the contract manufacturing for a U.S.-based MNC, and that is going off patent in this year and next year in some of the markets. Do you see the opportunity to expand volumes for new customers for that particular molecule? No, sorry. You know, we are in the business of custom and contract manufacturing where we work with partners in markets, right? We are not gonna cut throats by giving it to their competition, but we will support them to see how we can build the business with them. No, no, I was referring to, in partnership with the U.S.-based client only because their revenues will increase because of the partnerships they are, doing across the globe. My question was in relation to that only. Those are discussions which remain between the partner and us. Yeah. That's the way it is. Okay. Understood. All the best. Thank you. Our next question is from the line of Sangeeta Purushottam from Cogito. Please go ahead. Miss Sangeeta Purushottam, please go ahead with your question. Looks like the line is disconnected for this participant. In the meanwhile, we'll move to our next participant, that's Dhaval Shah from ICICI Securities. Please go ahead. Yeah. Thanks for the opportunity, sir. Most of my questions have been answered. Just one question. I mean, you have passed on the input price inflation this quarter, so would it be possible to break it up between the volume realization growth within these two segments, CSM and the domestic one? Well, we don't have that. Mani, you would have those numbers, Mani? Not really. We don't have that breakup. Most of that would be volume this quarter, right? Yeah. I mean, most part of it is volume. Obviously there is, you know, some price hike which we have taken, both in Domestic as well as in Export. Right now number is not there. Yes, Mani can certainly provide you on the sidelines. Sure, sir. Just one thing is on the CSM. We have seen the highest number this quarter. I mean, once we'll pass on the input price inflation for this segment also, can we see you know, the jump up in the revenue of this segment meaningfully over the period of time? Yes, we are certainly expecting to, you know, with the full impact of this cost increase is done, then there will certainly be, you know, positive impact on the margins. Sure, sir. Thanks. Yeah. That's all from my side. Thank you. Our next question is from the line of Manish Mahawar from Antique Stock Broking. Please go ahead. Yeah. Good afternoon, sir. Just wanted to know what was the CSM business market size last year, FY 2021, and what was the market growth and our market share, if possible. Come again. Can you please repeat? CSM business. CSM market size globally, and what is the growth rate in the last year, CY 2021, and if possible, what is our market share? Well, this is a little tricky question because market size depends on what kind of portfolio of products that you consider. As you know that we work only in early stage molecules and all. Considering that kind of product profile and portfolio, I mean, we believe that the market size is overall globally anywhere between $6 billion-$8 billion. Okay? Given our size, you can clearly imagine that what is the kind of market share currently we have. Obviously this market, because these are early stage molecules, the growth trajectory is reasonably high. Okay? Which is what is also reflecting as if you see in our own growth, you know, in CSM export. Okay. Maybe last one more question, sir. Just what could be the tax rate for this year and the next year, if possible? Can you share? Mani? Yeah. No. In the current year, we are on the effective rates around 16%. For the next year, we'll give it post the next quarter, please. Sorry. Could you repeat? This year it will be 15%, and next year? I said it is 16-1, sir. Okay. Okay. Sure, sir. Thank you. Thank you. We'll take a last question from the line of Deepak Chitroda from PhillipCapital. Please go ahead. Yeah. Thanks for the opportunity. My question is on the CSM side, if you can basically tell us in terms of, you know, number of MPP plants which we have now on the plant-by-plant basis, for example, Panoli, Jambusar, and Isagro which we have after commissioning these two plant current year. No, I didn't get your question of number of MPPs. Number of MPP plants which we have now on the plant base. 15 plants all put together. Okay. I think Panoli will be having the majority of the plants. Yeah, I mean, the major plants. In numbers, yes, but capacity is no. Yeah. My second question is on towards the, you know, you know, the volume and the price side, which I think you partially answered in the previous participant question. I think the major part of the, as you mentioned, that the growth has come from the volume side, right? It is correct to say that, you know, probably might have taken around 2%-3% kind of a price hike and probably might take another, you know, maybe double price hiking for the next quarter? Well, as we have explained in our release, that the partial impact of this price hike is already reflecting in our quarter three numbers. Some impact, balance impact will also surely reflect in Q4 because the cost trend is still continuing. There is always a, you know, lead and lag whenever you have this pass through. Yeah, Rajnish Sarna, basically, I was just trying to understand that price increase we will be taking, probably for the next quarter will be slightly higher compared to what we did in Q3. Well, this all depends on what product, what price is getting impacted, you know. For some products it has already been done in this quarter, and for remaining product it will come in the next quarter. Okay. Thanks. Thank you. Ladies and gentlemen, that was the last question. I now hand the floor back to the management team for closing comments. Over to you, sir. Thank you. Thank you everybody for all your kind support and participating in the call today. I wish you all a very safe time ahead. I'm sure that with coming times, this Omicron should be over and life should be back to normal for you and all your families. Thank you. Thank you, members of the management. Ladies and gentlemen, on behalf of PI Industries Limited, that concludes this conference. Thank you for joining us, and you may now disconnect your lines.