Good day, and welcome to the Varroc Engineering Conference Call. As a reminder, all participant lines will be in the listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing star then zero on your touch-tone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Tarang Jain, the Chairman and Managing Director. Thank you, and over to you, sir. Thank you. Tarang Jain here. Good afternoon to everyone, and I would like to thank you all for joining the call of Varroc Engineering Limited. We're having this call to apprise our stakeholders about the divestment of the four-wheeler lighting business in Europe and America. We will also talk about how the continued business is progressing for the company. First, in respect of this divestment, I would like to highlight some important changes. The continuation of the Russia-Ukraine war leading to higher inflation, the consequent tightening by the central banks, and the semiconductor supply shortages continue to impact both the supply and demand. This has resulted in lower demand, higher raw material prices and labor costs during the current year, especially the operations which are based in Europe and America. Economists are also forecasting recessionary trends in developed countries in the near future. On the backdrop of this and to take care of the buyer's concern, we had to amend the enterprise value from EUR 600 million to EUR 520 million. Further, we strongly believe that the patent infringement cases which were filed by Valeo will be nullified by the German court. The independent third-party opinion which we obtained also supported this view. However, this nullification process requires a further 12 to 18 months of time. Considering the urgency of concluding this deal, we had to agree for an out-of-court settlement for a higher value of EUR 51 million. Moreover, the debt and debt-like items have further added up to approximately EUR 56 million, compared to our earlier estimate of EUR 25 to 30 million. Details of the same are given in the presentation. Hence, as communicated in the AGM, the leftover equity value will be significantly lower than what we had estimated earlier. The net cash accretion, excluding escrow, will be also lower at EUR five to nine million, as compared to EUR 160 million estimated earlier. As a result of this, the net debt in continued operations will only come down marginally, though there will be a significant reduction in the consolidated debt. These changes will result in write-down of investments and advances. We will also have another EUR 28 million in the escrow account, and most of that is expected to flow to us in the near future. Conclusion of the deal will result in avoidance of further debt burden on Varroc India, besides enabling us to focus on high growth and profitable segments of our continued operations. Some of the highlights of the continued business I would like to share some positive developments in our continued businesses. The operational performance of the continued business is steadily improving. Firstly, the Indian operational revenue for this quarter, that is Q2 FY 2023, will be the highest ever in the history of Varroc. Secondly, we continue to see strong new business wins from incumbent as well as new players. Thirdly, the VLS remaining operations is also improving its operating performance. Lastly, the forging business in Italy, which is called I.M.E.S., started delivering positive EBITDA margins as we have seen in Q1 FY 2023. In our future strategy, prudent capital allocation and free cash flow generation will get a lot of focus. I will now request our group CFO to walk you through the presentation, which has already been uploaded in our website and on the stock exchange. Over to you, Mahendra. Thank you. Thank you, Tarang. Good afternoon, everybody. Welcome to this call once again. I'm happy to talk to all of you once again in my new role here. As Mr. Tarang explained, the presentation has been uploaded on the website already. I think some of you or all of you might have seen it. I'll take you through the presentation right now. On slide number two, we try to explain what was the initial assumption or proposal when we actually started the deal a few months ago. On the right side in slide number two, we explain the changes which have happened in the final settlement. As you can see, and as Mr. Tarang also explained earlier in the call, the EUR 600 million enterprise value had to be brought down to or amended to EUR 520 million, considering the current economic scenario across the globe. As you also might have noticed in various press releases or on news items across the globe, the merger and acquisition activity has come down significantly. In fact, I was reading news reports that between U.S. and Europe, the merger and acquisition activity went down this year by close to 50% to 60% compared to last year. Our focus was mainly to basically save this deal or conclude this deal. The continuing outlook also seems to be somewhat a matter of concern because all of you know that Europe is going through a lot of recessionary fears. To accommodate these requests and these concerns of the buyer, we have to bring down the value from EUR 600 million to EUR 520 million. This out-of-court settlement also had to be finalized for EUR 51 million, though we had a strong case to fight it out. In order to conclude the deal, we had to agree for this high amount of settlement. The good thing is this will actually put to rest all these disputes which have been hanging for some time. The net cash accretion to Varroc will now come down to EUR 5 to 9 million. I will explain the walk in the subsequent slides. Another positive thing here is the escrow, which was earlier pegged at INR 35 million, has now been brought down to INR 28 million. With this, we concluded the deal yesterday and the settlement also has happened. The overseas debt and debt-like items of approximately INR 400 million have been settled. Now, this is another positive development for us, the way I see it, because this much of debt burden or debt-like items burden has been washed away from the consolidated balance sheet, which should give us good kind of relief going forward. I will take you to slide number 3. This explains the walk, what we presented earlier versus what it is now, just so that all of us are clear about, the walk. We previously, as you might remember, the enterprise value of EUR 600 million, after all these adjustments for debt and debt-like items, is supposed to result in a net cash accretion of about EUR 157 million-EUR 161 million. With this reduction from EUR 600 to 520 million and the value of settlement coming in, the net cash accretion will now come to EUR 5 to 9 million. Enterprise value reduction we already talked about. Because of all these economic factors and the cost pressures, the raw material inflation and labor costs also have gone up in European countries. That created some kind of a bleak outlook for the future for these operations. To allay the fears of the buyer, we had to go for this kind of a correction. The patent infringement also, as Mr. Tarang also explained earlier, we had a strong case to fight it out. We had certain legal opinions also supporting our case. Again, to conclude the deal or to avoid further delay in the deal, we had to reach this out-of-court settlement and come out of these disputes. There were a few other adjustments, like working capital changes and license costs and lease liabilities, which we had to correct. That resulted in a reduction of equity value of about INR 188 million. The escrow amount earlier pegged at INR 35 million, has now been brought down to INR 28 million, because the INR 35 million earlier also had a value related escrow of close to about INR 10 million. Now that we reached a settlement, that has gone out. Similarly, the debt repayment is now INR 33 million. Earlier it was INR 62 million, but some of the debt has been repaid in the last few months. Now this is again a good relief for the continuing operations. From the continued businesses, INR 33 million of overseas debt is going to be paid out. That will reduce the burden on continued operations. That leaves out about INR 5 to 9 million as the net cash accrual to us. Now, all this will result in some kind of write down or impairment of the investments in our VCHBV. This is under evaluation right now. We'll have to take into consideration various factors here because some of these VCHBV investments are into both continued and discontinued businesses. We are in the process of doing a fair value assessment of some of those continuing businesses. We'll see where the net impact ends up. Anyway, we'll be completing audit by end of this month. When we talk about the Q2 results, we'll explain what could be the net impact. Now I will take you to slide number four . This gives the status of net debt. Previously, I think when we talked about the net debt levels as of 30th June, we indicated that the continued operations in INR billion was 15.2, which will now come down to about INR 13 billion. That's one good development. That's about the deal and the impact on the overall debt levels. Talking about these continued operations, of course, the things are looking bright for the existing businesses. We could actually improve profitability in Q1 for continued businesses. In fact, the momentum is continuing. Both in August and September also we could record one of our highest ever revenues for Indian operations. Of course, we'll talk about the full results when we talk about the Q2 final results. We also added three new customers, significant customers in the last six months in the EV business. The ramp-up of existing EV components business, which we obtained earlier, is also happening. Then of course, the new orders with a lifetime value of close to INR 1,500 crores have been won in Q1. Q2 status also we'll report later. The aftermarket business continues to grow healthy, at about 20%. Now one important thing we would like to bring to your notice is going forward we'll be focusing heavily on free cash flows and return on capital employed improvements. We'll be very prudent in our capital deployment strategies also. In a way, I think this is like a new beginning for Varroc. The significant burden in terms of overseas operations and the cash flows has been now taken away. It enables us to focus now on the existing businesses which are profitable. We'll be focusing on free cash flow generation going forward and see how to actually properly deploy it going forward. We'll also be focusing significantly on integrating our remaining overseas VLS operations. Also that will be our areas of focus in the coming weeks and months. With that, I will stop. We will now take your questions and clarify any doubts that 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 on their touchtone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. We have our first question from the line of Aditya Jhawar from Investec Capital. Please go ahead. Yeah, hi. Thanks for the opportunity. Congratulations to the team for closing the deal in such a challenging time. I have two questions. Number one, on the debt side. You know, for the next couple of years, what is the line of sight of debt repayment? If you can walk us through that, what could be the CapEx for continued operation, and what is the plan of debt repayment in FY 2023 and FY 2024? Aditya, you know, where the debt is concerned, see now I would say that the debt is under more manageable levels. We see, you know, very high growth, you know, in the Indian market, in spite of, you know, what's happening in the rest of the world. India continues to grow, and we are also growing in some of the important segments like EV and electronics and lightweighting. This bodes well for us. We are quite confident that, you know, over the next couple of years we will be bringing this debt down, you know, considerably. Our focus definitely, like what you correctly mentioned, will be two areas. One is of course, you know, proven capital allocation, you know, and we do not see, you know, I'm talking now only about, you know, India and Europe. We do not see that, you know, the CapEx, you know, going forward, you know, will be more than probably around INR 300 crores or a little bit, you know, more, in that range. And whatever else, you know, with the rising EBITDA which we expect with the rising sales, we are gonna focus that we have a, you know, quarterly reduction in our debt as we go along. We'll be really focused on, you know, how we are managing to still become a net debt zero company going forward in the next couple of years. Okay. Yeah, that's helpful. My second question is that, you know, in our order wins for specifically for EV components, have we got any visibility or order wins from other than Bajaj, for EV specific components? You know, in this, in the recent months, you know, now we have three, I would say prominent, you know, EV players, you know, whether they are the incumbent, you know, companies or the new ones. We've got three large EV players where we have won business. We're not allowed to disclose, you know, the names and the details at, you know, at the moment. We will try to see if we can share it with you at the time of the Q2 results. You know, we have now three companies and things are looking very good for us going forward in the EV space, whether it's for the powertrain or whether it's for the other components in the EV. Okay. That's very good to hear. That's it from me. All the best to the team. Thank you. Thank you. We have our next question from the line of Abhishek Jain from Dolat Capital. Please go ahead. Thanks for opportunity. Sir, you mentioned that after this deal, your debt would be reduced to INR 13 billion. How much is from the Indian continued operations and overseas continued operations? Yeah, I will say that. I will say that. Okay, please. Yeah, I'll take this question. See, most of it will be in India operations. There'll be only very little left overseas. How much debt would be left in the overseas operation? Earlier in the last quarter it was around INR 2.53 billion. Yeah, it'll be in terms of INR equivalent, it'll be close to about 100 crores or so. INR 100 crores. Okay. After this deal, you will have a balance of around EUR 120 million. Out of that, you will pay around EUR 52 million. Net cash flow should be around EUR 70 million, out of that EUR 30 million for the escrow account. Still you should have around EUR 40 million, no, sir? You are talking about the EUR 5-6 million only. Yeah, yeah. We are not counting on the escrow money now, so that's why these levels what we are indicating now is excluding the escrow realization. After excluding escrow realization, we have a calculation of that. You should have around EUR 50 million. Because you had paid around EUR 400 million as advance and balance would be around EUR 120 million, and thereafter out of that you will pay around EUR 52 million because of this Valeo litigation. Yeah, I mean, I think we gave the details in the slide. We can see those details there. What we are saying is after all this, the equity value will be close to around EUR 62 to 70 million. Out of that, if you take escrow of EUR 28 out, we'll be left with around 42. Out of that, 33 will go to repay the continued operations or this debt of about EUR 33. That leaves out anywhere between EUR 5-9 million for other things. Okay, got it. Without counting on escrow. Okay, sir. Got it. Sir, what is the future of the China VLS business after this deal? Most probably that will be scrapped because there will be competition with the other players also. See, on the China piece, as you know that, Plastic Omnium has not bought into, you know, our JV in China. Our JV is still continuing, you know, in China. That is between TYC and us. We have been in discussions for the last couple of years for a split, you know, between us, and those discussions are progressing. We are hoping that we are able to reach a conclusion within this financial year 2023, so that, you know, then we can also get the China operations, you know, I would say, within our continued operations going forward from the next financial year. Those discussions are going on for a split, and we are hoping to see some results there in the coming near future. Okay. Within this financial year. Sir, because of this litigation, the Valeo, is there any impact on the four-wheeler India lighting business, which is getting a good business from the many OEMs? No, not really, because, you know, also personally, I mean, on this Valeo litigation, you know, frankly, our case was very strong. Like, Mahendra said, you know, that we had to, you know, kind of, reach the settlement in the interest of concluding on this deal. What this means is this is a total settlement. It's a settlement for the past, any so-called alleged patent infringements, and also we have a license for all the current products for the future till end of life. Okay. You know, this covers everything, and it includes also, you know, whatever are all the entities of Varroc which are remaining with us, whether it's India or it's China or elsewhere, all are included under this, future license. As the deal has completed on 1st October, you will not incur any further loss of VLS for the first half FY 2023? No. We are not. As you know that on the discontinued operation, that's not coming on our, you know, in our results. We are only kind of showing the, you know, results of the continued operations. Okay. Sir, one last question is, what is your revenue and EBITDA target for FY 2023 and debt repayment target for the next two years? No, basically this year, you know, for this financial year, we already said that for the continued operations and not including China till it splits, you know, we were looking at about INR 7,000 crores of revenue. On the EBITDA side, I think we would be trying to achieve an EBITDA of around 9%. Going forward, next year, obviously, we are looking at a growth like we have said that we, especially in India, we're looking for a growth. India now will be a mainstay. Almost about 80% of our revenues come from India. Here, like we said, that we will grow 10% more than the market growth, you know, in the Indian segment. Definitely, you know, going forward, I mean, we are also looking at a double-digit EBITDA, but our target is of course going forward to be between 11% and 12% EBITDA in the next financial year. Yeah. For the whole of continuing operations. Debt repayment plan, sir, for this year and next year? We will see. That is something we are actually working on our debt repayment schedule. That's something we're working on, and we will see, like I said, quarterly reduction in debt. As now we are in control. It will not go up. It's only gonna reduce. That's something I think we can probably a little bit more share with you know, when we are announcing the Q2 results. But definitely I think we'll be in a healthier space, you know, as we move along where debt is concerned. That's something which is also on top of our agenda. Thank you, sir. That's all from my side. Yeah. Vishal, just don't take these things as future guidance or any kind of revenue guidance or profit guidance. These are like our estimates. Yeah. Yeah, sure. Thank you, sir. Thank you. Reminder to participants to press star and one to ask a question. We have our next question from the line of Jyoti Singh from Arihant Capital Markets Limited. Please go ahead. Thank you for the opportunity. My question is on the similar side of the debt is, we have debt around INR 1,556 crore in FY 2022. After this deal, how much we are expecting it will reduce by 2023 and 2024, if you can guide us. Thank you. Mahendra, you want to. As I explained earlier in my presentation, after this deal, we will end up with a net debt of about INR 13 billion or around about INR 1,300-1,350 crores. Okay. Thanks. Thank you. Ladies and gentlemen, to ask a question, please press star and one on your phone. We have our next question from the line of Karan Kokane from Ambit Capital. Please go ahead. Yeah. Hi, sir. Thanks for the opportunity. My first question is on growth. You mentioned that you are planning to grow 10% ahead of the industry. Could you please elaborate on, you know, what would be the key drivers of this? The key drivers would be basically, I think, the content growth which is coming, you know, in the premium. Largely, when I'm talking now more about India, which will be a larger play. In India, we see a lot of premiumization in the two-wheeler market, you know. And there's content growth which is happening, you know. For example, you know, we see, for example, you know, like say when it comes to Bajaj Auto, we have seen that, you know, the Pulsar, I mean, the Pulsar family, you know. Just to give you an example, I'm just saying that, you know, they had models between 125 cc to up to 250 cc in the Pulsar range. Now, other than the 125 cc, all the others, they've come out with new models, you know, above 125 cc, which today it's code-named K17, but it will be called something. Here the premiumization is a lot. You know, when it comes to electronics, you know, when it comes to even the use of plastics, the use of paint in the plastics. There's a lot of premiumization which is already happening, for example, you know. A lot of that, a lot of our entry into more of the older plastics business in India, you know, on the interior component side. Generally, obviously, you know, the EV side growth, you know, will lead to a lot of additional business because when it comes to, you know, the scooters and three-wheeler where we see more of, you know, EVs happening, at least in our case. You know, our share of overall this thing is not more than 10, 12% for scooters and on the three-wheeler side. Here, whatever comes out of the EV side is all, you know, additional revenue for us, you know. Also, a huge content growth for us. Therefore, you know, we see that, you know, from a revenue standpoint, we can say that even if the market grows next year at 7% or whatever, 5% to 7%, we will be 10% more. We are very confident going forward that the revenues will be realized. We have already won in this financial year, last financial year, a lot of business. You know, when it comes to, you know, plastics, plastic products or related polymer products, you know, electronics, lighting, two-wheeler and four-wheeler lighting. We remain quite, I would say bullish, you know, over here. Also, when it comes to our foreign two-wheeler lighting business, you know, when it comes to Italy and Vietnam. Vietnam, we see a quite a good growth going forward. In Italy, yes, we have to get in some more revenue. That's something now we will focus in a bigger way. Of course, our four-wheeler electronics, which we have a plant in Slovenia, we will also see a certain level of focus coming in there. I'm just saying that we on the back of India, we see a good level of growth. When we're talking about 10% more, is more for the Indian market, not for Europe. Understood. My second question is on EV components. Many auto component players, you know, nowadays have been manufacturing components like motors, controllers, BMS, you know, all those components. Sir, my question is, what is our key competitive advantage in these components? And what do OEMs look for? What is the differentiating factor in these components, and why will we gain market share? On the EV powertrain, I think the main products which we have are the motor, the motor controller, DC/DC converter, and our telematics control unit. These are the major products. These are models also. I'm just saying for the EV powertrain. Here, you know, there are two models. One is a build-to-print model, you know, which sometimes the customers want to give their design, you know. The second model is that we've already developed, you know, the motor controller on our own. The DC/DC converter, obviously, and telematics control unit is our own proprietary technology. That's anyway for anybody, I mean, when we supply, that's our own proprietary technology. For motor controller, which are the two main products in the two- and three-wheeler EV, there are these two models, you know. In both the models, I think what we bring in is that, you know, we have put up a very robust manufacturing process, you know. Whether it comes to electronics or on the motor side, you know. We bring in very strong QCD kind of a very reliable and sustainable products. You know, that is one thing. Secondly, of course, we are competitive, you know, we are competitive in our pricing, whether it's for a build-to-print or whether it's for our product. We remain very competitive, you know, in this segment. People see us that we have proprietary technology. You know, we have a strong R&D when it comes to development, advanced engineering when it comes to development of these EV products. People have seen it, and we've already started EV powertrain for at least one customer, and people know, you know, about this. And obviously we have a, you know, I mean, we have a this thing, a very strong performance track record, you know, for overall products. And people know that, all the customers know that. We see a lot of interest, you know, coming to Varroc. In a way, I would say that we are, you know, selecting and going forward with whom we consider are the winners, you know, in the market going forward. Understood. Sir, third question is on margins and ROC. You've spoken about double-digit margins. Currently we are at single digits. Apart from, you know, commodity benefits, what would be the key drivers of margin improvement from these levels? And do you have any ROC target in mind? The key driver also, one is of course the general stuff that we are improving operationally, you know, year-on-year, and like you correctly said, whether it's on the material side. Main driver is, you know, volume growth. With the volume growth, you know, firstly there's a better control on the fixed costs. Secondly, obviously, you know, you can realize, you know, better deals when it comes to buying of raw materials or vendor parts. You know, so these are a few, I would say, main drivers, I would say more than anything else. You know, of course, more we do on the electronic side, you know, it's anyway, I think better margins for us, you know. We feel comfortable to say that we will, you know, be moving forward to achieve the double-digit margins. ROC for sure, you know, and I would say ROC is going to be more than 20, you know, as we move forward. That is our minimum target, that we have to have a pre-tax ROC of 20. But like what Mahendra also showed in his presentation earlier, a big focus is gonna be, you know, other than ROC on free cash flow. So that is something which is gonna be the most important. So it's prudent capital allocation, yes. For some time now we have to also repay our debts because they're still there on our balance sheet. We'll be extremely focused on free cash flow and on ROC as we go forward. Understood. Sir, the last question is on aftermarket. You said that you're seeing a 20% run rate figure in the aftermarket segment. What is driving this 20% growth? I think the 20% growth, we have a you know, we have a strong team. You know, in the aftermarket, it is for the domestic market and as well as you know, for the exports. Largely, we are doing products which we manufacture on our own in-house, and also we do trading in items, you know. That is something we're seeing, that we are getting better penetration, you know, in various tier two and tier three cities that is every year-over-year. You know, our reach is actually increasing in our own network. We are able to. We have, and that is what is helping us, you know, and also we're adding newer products, you know. We add a few more products. Our reach is growing in India, growing up in India. Exports also, I think countries, more countries in Africa, in South America, Southeast Asia. We are adding, you know, a couple of countries also, you know, and also growing the current markets abroad. Here, you know, we have seen in the past few years track record, if you see, we are growing more than 20%. That's something that we feel we will continue to do as we move forward. We are confident. Understood. Sir, just one thing I forgot to ask. This I.M.E.S. was reporting operating losses, and there were also plans of hiving off this business. How is this business doing? Are we planning to hive it off? Will that bring in more cash flows? Yeah. Basically, immediately, I agree with you that it's not a non-core part of our business. I mean, it's not a core part of our business. Because, you know, we are largely into the auto market, whether it's to do with cars, commercial vehicles or two and three-wheelers. This is more, you know, non-auto to do with oil and gas, industry and, you know, Caterpillar and, you know, these kind of customers. But presently what is happening is that our focus today on immediate terms is to improve the profitability here, you know. The higher EBITDA margins, achieving, you know, a PAT here. We are working a lot, you know, with our existing customers on more revenues, you know, and also a better operational performance. The focus is actually on that at the moment. Yes, let's see how it goes. You know, immediately I don't see in the current environment, especially in Varroc, where things are so bad. I don't see really, you know, a sale taking place, to be honest. So we have to. That's our focus has to be that we make this plant stronger in the near future. When the environment, you know, gets better, you know, then we can probably look at, you know, and when the business is stronger, then we can look at, you know, I would say, probably a possible, you know, an M&A or something, you know, at that point of time. But immediately we are not looking at it. Understood. Thanks. That's all from my end. Thanks. All the best. Thank you. Thank you. Ladies and gentlemen, to ask a question, please press star and one on your phone. We have our next question from the line of Vishal S from Swan Investments. Please go ahead. Thank you for taking my question, sir, and congratulations for the deal. Sir, I have two questions. Sir, first question regarding the impairment of investment in VCHBV. How much is, as per your estimation, will be the impairment? I know the decision has not been taken yet in WIP, but what can be the magnitude, and when this impact will flow in our books? Do you expect it to flow in FY 2023 or going forward? That is my first question, sir. Yeah, maybe I will take this question. No. Vishal, as I mentioned earlier in my presentation, we are currently assessing it. I don't want to put a number to it because it is subject to audit also. We will come back to you anyway at the time of Q2 results. To answer your other part of question, yes, we will recognize this impact during Q2 results. Sir, my second question is, by when the escrow account, escrow amount will flow in our books, and what do you expect, you know, it will be 80% or 90% of the escrow account which is stated currently? Or, you know, what can be ballpark number of this, what you have stated? Yeah, maybe I'll take this question also. See, we want to stay conservative at this moment, so we are not banking on this escrow amount when we quoted this net debt of INR 13 billion. But having said that, we are expecting that more than 50% of this at least should actually come to us during this financial year. But again, there are certain conditions and all. We need to see how actually things progress in the coming months. When the time is appropriate, we will come back to you with more details on that. Okay, sir. That's all from my side. Thank you so much. Thank you. Thank you. We have our next question from the line of Basudeb Banerjee from ICICI Securities. Please go ahead. Yes. Thanks, sir. Congrats for finally closing the deal after many months. Just a few things to understand. With this change in valuation now selling off to balance that off, how quickly one should expect I.M.E.S. stake sale to balance off the increase in debt on balance sheet? For Arpi. To answer the I.M.E.S. question, you know, I just answered a bit earlier that presently, see, we are not looking at a sale because I don't think in the current environment in Europe we are gonna find a buyer. You know? I think the focus now is on operational improvement, and that's what we are focusing, and we are getting some good results. I think only once, you know, because we are talking about now recessionary trend setting in Europe, you know, and I don't know how long it's gonna go on for. Immediately we can't be thinking, you know, on those lines. Our focus would be on operational improvements, and if an opportunity comes, you know, in the near future, you know, then we can look at it. Presently we're not looking at, you know, the sale of I.M.E.S. Frankly speaking, I don't know. I mean, yes, going forward, you're gonna get some big, you know, kind of a, you know, value out of it, even if we have to sell it. I don't think it's gonna be a big value transaction that's gonna impact us, you know, in a very significant way. You know? Yes, I do agree that it is not a part of our core business, and that's something in our mind that we have to deal with it at some point in time in the future. Next thing, sir, post this change now, what level of interest outgo per quarter you are guiding for next three, four quarters? Mahendra? Yeah. As I mentioned, we are now having debt of close to INR 1,300 crore-INR 1,350 crore. We'll of course make some efforts to reduce the debt levels in the coming quarters, like what our chairman explained. Because you know the current cost of borrowing. Give us some time. We'll anyway work out some kind of a plan and we'll continue to reduce the debt levels as we go forward. Last thing, sir, with steel, aluminum, copper, so much of correction in the commodity basket, for your core India business, legacy business, what kind of margin uptick we can see from present levels from nine to 12 months? Basically, all these elements, all these commodity prices going up and down. We have an understanding with all our customers in India, you know, mostly for a quarterly adjustment, you know? You know, recently, like, for many quarters earlier we saw, you know, an upswing in all these commodity prices, and we had to absorb, you know, one quarter of, you know, this upswing in commodity costs. After that we also saw a little bit of, you know, softening on the commodity side and there were some gains also, you know, over there. Our risk over there is limited. I think this up and down in commodities are not gonna really impact too much, you know, our margins, you know, overall that, you know, whatever our objectives are on the margins that they should be going up. It's not going to be impacting so much. With the growth which we are envisaging going forward, you know, we do expect, you know, that we should be able to kind of realize our, you know, whatever our goals are. Sure. Thank you. Thank you. We have our next question from the line of Deepak Pawar from Vasuki India Fund. Please go ahead. Hi. Congratulations on the deal to the entire team. My question is, what would be the expected EBITDA of India business for this financial year? What you are expecting the EBITDA on the EV component business as standalone? Like I said, I mean, we are gonna be striving for the continued operations at, you know, about 9%. India could be, you know, listing higher, you know, than Europe, you know. I mean, for the other businesses of polymer and lighting and Europe. What was the second question? Sorry. Expected estimated EBITDA, any ballpark figure on EV component business as a standalone, only EV component? See, that is something, you know, we really cannot share, but it's not that the margins are, I would say. Whatever are there, you know, the electronic side of the EV, whatever the margins are, there for other electronics are the same thing, we are getting over there. It's not that the margins are much higher, but because the content is very high, you know, it is quite beneficial for us, you know. Overall, I think the overall revenue growth is what is helping our margins also grow. Any ballpark figure on only India standalone business? No, no. See the EV side of the business, the powertrain. I can only say that, you know, it will be double digits, but I cannot share the number. Okay. Okay. Thank you. Thank you. We have our last question from the line of Shweta from ICICI Bank. Please go ahead. Yeah. Hello, sir. Just one small question on the semiconductor chip shortages issue. Will Varroc continue to face this shortage issue in the coming future, or what do you envisage in this manner? See, what we see is that this shortage issue is actually improving, but it's not gone away. You know? We do expect that, you know, probably next six to 12 months, you know, there will still be, you know, shortages, you know, in the, I mean, for us. Somehow, you know, we are very closely working with all the electronic suppliers. We have very good understanding. In our case, largely, we are able to manage quite well all the chips. In some cases where there are some shortages, we are now pushing for higher allocation because of the issue that the growth is very high in India. You know? We have to see that, and we are giving projections, you know, for next one and a half years to all the electronic suppliers. We have to make sure that we, you know, that we are balancing the growth. That's more the important because what are the volumes, today we are somehow able to manage, you know, about it very comfortably. Most of it are the same, but some cases there are some, you know, shortages which we manage in the end. Maybe some hand-to-mouth kind of a situation. Largely, I see that the situation is improving. Sure. Okay. Thank you, sir. Thanks. Thanks. Thank you. I now hand over the call to Mr. Tarang Jain for closing comments. Over to you, sir. Yes, thank you. I would like to thank, you know, again, everyone for joining, listening, and asking the various questions. The trust and faith of the stakeholders is what motivates us to pursue excellence in our day-to-day life. Thank you once again, and all the best. Thank you, sir. On behalf of Varroc Engineering, that concludes this conference. Thank you for joining us, and you may now disconnect your lines.