Ladies and gentlemen, good day and welcome to VRL Logistics Q2 FY27 earnings conference call hosted by Motilal Oswal. Motilal Oswal Financial Services Limited. As a reminder, all participant lines will be in the listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Good. Should you need assistance during the conference call, please signal an operator by pressing star and then 0 on your touchtone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Alok Deora from Motilal Oswal. Thank you, and over to you, sir. Uh, thank you. Good morning everyone and welcome to the 2Q FY27 earnings call of VRL Logistics. Uh, so from the management side, we have Mr. Sunil Nalavadi, the CFO of the company. I will now hand over the call to Mr. Nalavadi for his opening comments, and then we can take up the Q&A. Uh, thank you, and over to you, sir. Yeah, thank you, Alok ji. Good morning to all the participants. I am Sunil Nalavadi, CFO of VRL Logistics. I warmly welcome you all to VRL Logistics Q2 and half-year FY27 earning conference call. Thank you, thank you for taking the time to join us today. Our financial results and investor presentations of the quarter and half year ended September 26th have been uploaded to the stock exchanges and are also available on our company website. The first half of FY27 has been particularly encouraging and marks a robust new beginning for VRL Logistics Limited, with strong profitable growth, significant margin expansion, improved cash generation, and balance sheet strengthening. We have witnessed a meaningful improvement in our operating and financial performance, supported by the benefits of our earlier freight rate hikes and rationalization initiatives. Strong customer engagement, improved network penetration, and continued emphasis on operational efficiency. I'm also pleased to share that the company has delivered a strong performance during Q2 of FY27 with significant improvement across total income, EBITDA, and profitability. More importantly, this performance reflects an improvement in the quality of our earnings, with higher freight realizations, better cost absorption, and stronger operating leverage contributing to our expanding margins. Let me begin with our financial performance for the quarter on a year-on-year basis. Our total income for Q2 is increased by approximately around 20% year-on-year to ₹967 crores compared with ₹804 crores in the corresponding quarter of the previous year. This growth was primarily supported by an approximately 11% increase in goods transport volumes from 10,07,000 tons to 10,79,000 tons. Along with a 9% improvement in freight realization per ton from ₹8,799 to ₹8,840. The improvement in realization reflects the positive impact of our freight rate hike and rationalization initiatives. Our continued focus on securing remunerative business and maintaining pricing discipline has enabled us to improve revenue quality while retaining and expanding our customer base. Our EBITDA for the quarter increased to ₹226 crores from ₹158 crores in Q2, registering an impressive growth of 43%. Correspondingly, the EBITDA margin expanded to 23.3% from 19.7% in the corresponding quarter last year. An improvement of 367 basis points. Profit after tax also witnessed a substantial improvement, increasing to ₹103 crore from ₹50 crores, representing growth of approximately 106%. The PAT margin improved significantly to 10.7% from 6.2%. And also here I would like to mention that the quarter Fat is more than the last year, half year. profit. The operating, operating environment during this quarter remained challenging, particularly due to geopolitical developments, crude oil price volatility, and the resulting increase in fuel procurement cost. Fuel continues to be one of our major operating expenses during the period. The cost per liter increased significantly from approximately ₹85 to ₹97. Putting pressure on our operating cost structure. The increase also affected the benefits we traditionally derive from bulk fuel procurement. However, through timely and calibrated freight rate adjustments, we were able to pass on a substantial part of these cost increases to our customers while maintaining healthy volume growth. At the same time, our continued focus on cost management and operating leverage helped us to contain the impact of inflation across most of the operating expenses, including employee costs. Employee costs declined from 18% to 16.48%. Of total income, in spite of increase in absolute terms from ₹147 crores to ₹159 crores, administrative expenses declined from 2.28% to 1.43%, largely reflecting lower legal and professional expenses incurred in the last year. Other operating expenses also declined from 10.48% to 10.06%, and we also maintained better control over toll and dharmali expenses as a proportion of income. Withstand— notwithstanding the increase in toll plaza higher toll rates effective from April 1st and increased transportation volumes as well, there were some moderate increase in vehicle running expenses primarily associated with higher driver incentives along with modest increase in lower year service. Overall, these improvements in expenses ratio demonstrate our ability to manage costs effectively, improve asset utilization, and protect operating margins in a challenging cost environment. On the business front, our primary focus continues to be the expansion of our goods transport business through a wider branch network and deeper penetration into existing and new markets. During this quarter, we added 51 branches, taking the total number of new branches added during the first half to 67 numbers. This expansion has strengthened our geographical reach and enabled us to access new customer segments and business opportunities. We have also seen encouraging traction in customer acquisition alongside onboarding new customers We have successfully regained business and tonnage from certain customers who had earlier discontinued services following our freight rate rationalization and strategic withdrawal from low-margin contracts. This is an important development because it demonstrates that our disciplined pricing approach, along with unmatched service quality, is helping us improve profitability without compromising our ability to retain and attract customers. As you are aware, VRL has a strong presence in the B2B less than truckload segment, supported by a diversified customer base of over 10 lakh customers across multiple industries. One of the key strengths of our business model is our collection mechanism. A substantial majority of our LTL business operates through paid and UPI segments. Under which the freight is collected either at the time of bookings or upon delivery of the consignment. This substantially reduces our dependence on extended customer credit. And supports efficient working capital management. Consequently, our trade receivable cycle remains very healthy at approximately hardly around 10 to 11 days. Our diversified customer base, relatively low customer concentration, and extensive branch network and owned asset operating model continue to provide us with a competitive edge over other operators in the industry. Similarly, the sequential performance is also on a growth trend, and both Q1, Q1, Q2 put together, the H1 results are are also commendable numbers. An important highlight of the first half has been our strong cash generation. The cash generated from operations before working capital changes is around ₹415 crores compared with around ₹314 crores in the last first half year. Net cash generated from operating activities increased to ₹367.2 crores from ₹334 crores. We have strategically developed these internally generated funds towards business expansion, infrastructure development, and strengthening our balance sheet. Our capital expenditure for the first half stood at around ₹158 crores, comprising around ₹76 crores in Q1 and ₹82 crores in Q2. The expenditure was primarily towards the addition of commercial vehicles and investment in land and building facilities. At a strategically important location including Vijayawada, Nagpur, Lucknow, and Raipur. These investments are intended to strengthen our operational infrastructure, support future network expansion, and facilitate long-term consolidation of our logistics hubs. Despite these investments, we have successfully reduced our net debt to ₹337 crores as of 30th September. Compared with ₹440 crores as on 31st March 2026. Our net debt equity ratio has consequently improved to 0.3 times from 0.4 times at the end of FY26. Our own asset strategy continues to remain an important differentiator for VRL. As of the end of H1 FY27, our fleet comprised 5,941 vehicles. We continue to follow a disciplined fleet rationalization program involving the replacement and scrapping of older vehicles while improving the utilization of our existing own fleet. Approximately 76% of our total fleet is debt-free, while around 11% is fully depreciated and continues to operate in optimal condition. This provides us with a meaningful advantage in terms of lower finance costs better asset utilization and operating leverage. Before concluding, I would like to update you on the company's share buyback program. Considering the substantial improvement in profitability, healthy cash generation, and the strength of our balance sheet, The board had recommended a share buyback program aggregating up to ₹280 crores at a price of ₹320 per equity shares. The proposed buyback covers up to 87.5 lakh equity shares, representing approximately 5% of the company's paid-up equity share capital. The shareholders approved the proposal through a postal ballot concluded on October 3rd, 2026. The recall date for determining the shareholder eligibility was October 22nd. And the tendering window operated from October 27th to November 2nd, 2026. The tendering window has now closed and settlement of the bids is scheduled for November 9th, 2026. The promoters are not participating in this buyback. We believe this program represents a responsible allocation of surplus capital and reflects our confidence in the company's financial strength and long-term prospects. The consequential reduction on equity share capital and other equity will be reflected in the financial results for the 9-month period ending December 31st, 2026. Following completion and settlement of the buyback in accordance with the applicable requirements. The reduction in equity will also support further improvement on return on equity, return on capital employed, as well as earning per share going forward. With this, I would like to conclude my initial remark. Now the session is open for question and answer. Thank you. Thank you very much, sir. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and 1 on their touchtone telephone. If you wish to remove yourself from the question queue, you may press star and 2. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Jainam Shah from Equirus Securities. Please go ahead. Yeah, hi, thanks for the opportunity and congratulations on your good side of numbers. Uh, so if you see our strategy over last 2 and a half years since June 2024, we started doing this price hikes and all those adjustments to our business. Our realization has improved from around ₹6 per kg to around ₹9 per kg as of now. Over a period of time, there has been of course some, you can say, volume that has gone from our, uh, you can say, books to some other parties. And now we are eventually back on, you can say, double-digit kind of a volume growth, which probably we have not seen over last maybe 10-12 odd quarters. How do we see going forward 2H panning out and also for next few years? Like, the strategy of passing on to the cost will continue, or will there be any competitive pressure because of our pricing? Or what is your view on this pricing to volume kind of a strategy? प्राइसिंग इन वॉल्यूम यू कैन से सेटअप में स्ट्रेटजी Yeah, one thing on the pricing front, see, initially for the current financial year also, we expected our tonnage growth at around 8% at the beginning of the year. Now in the first half, we already reached around 10% growth in our tonnage. So this shows very clearly that there is no pressure of the freight rate on the customers. So considering the inflation cost of, uh, see, be it increase in fuel cost, labor cost, so many other increases, now most of the operators in, in the industry actually they are increasing the rates. So considering this environment, it will not bring any pressure on the volumes growth. Got it, sir. And how do we see volume growth going forward for the 2H and for, let's say, near to medium term or next 2 to 3 years' time? This growth trajectory will eventually continue given that we are back on the, this double-digit kind of a growth? Yeah, basically this 9 to 10% growth in the volume growth will continue, and this first half we already did around 9.5% growth in the tonnage. The similar growth we are expecting even in the second half of the year. Got it, sir. Got it. And sir, uh, one more thing on, you can say, uh, commodity part. So any specific commodity or let's say goods that has been doing really well for us in terms of volume? Across that has been playing out for us? No, across all industry, because it is a widespread operative operations what we are having. But considering this festival seasons and all, now FMCG and textiles, there is a good growth compared to the industrial and other segments, but those are again steady growth across all the segments. Got it, sir. And just last question from my side. We have been always, you can say, suggesting a better margin of 20-odd percentage, whereas we are beating the guidance overall. So, uh, by doing any kind of rate adjustment, what kind of margin do we have in mind, or we should take this margin going forward as well, or for the future years? Yeah, around 21-22% is a sustainable EBITDA margin even going forward. Got it, sir. That's it from my side. If I have anything, I'll join back with you. Thank you so much. Yeah, thank you. Thank you. The next question is from the line of Krupa Shankar from Avendus. Please go ahead. Good morning, sir, and thank you for the opportunity. Congrats on great set of numbers. Uh, so my question first was on the cash generation part, sir. So it has been quite strong, quite robust, uh, So just wanted to get a sense around how do you look to deploy cash over the medium term? Would you primarily focus on more CapEx towards land for hubs or would it be towards trucks? And Uh, or is it— are you looking at more of dividend payout? No, basically in the second half again we are expecting a capital expenditure of around ₹150-160 crores, which is including the vehicles as well as some of the one or two properties what we are planning. And rest of the cash flows will be used for, for the time being, reduction in debt further. I was talking about more about, uh, longer term, sir. I think, uh, because you have seen longer term again, see, our CapEx is going to be continued on the investment on vehicles and some of the selective properties. And the properties where actually we are investing, most of the investments again we are looking to buy the existing properties which we are using from, you know, for, for the last 10-12 years, which are more suitable for our operation. For example, the Nagpur where we acquired, it is existing facility. The Bangalore what we acquired just around 1, 1.5 years back, again it's an existing facility. Similar to that, actually we are looking in other places, but it all depends on the cash flows and again the debt structure. But the capital expenditure will be at least around ₹250-300 crores every year. It will continue. Considering our good cash flow. Yeah. Understood. So, sir, uh, looking at the, uh, with the tonnage growth being quite robust and for this year, while on a low base, on a structural basis, are you seeing any volumes coming back because of elevated pricing in an express business or something? Or is it— is there some structural trends you are looking at with respect to your business on your overall growth, sir? So can you estimate the— yeah, sorry. The structure is basically, since we are opening up more and more branches, those branches are contributing good volumes and that trend is going to be continued. Say for example, again I would like to mention the state like UP. Bihar, West Bengal, our presence is not up to the mark even as of today. So we are concentrating on those areas to add more and more number of branches. And structural changes is, say for example, we are very strong at South and Western market and North market as of today. So be it interstate as well as intrastate, but in Southern market, uh, on the both side, interstate and intrastate, we are very strong. So considering these, you know, experience, we want to replicate in the other zones as well. For example, now the— considering our branch expansion in northern and eastern part The most of zone to zone, actually the growth is very good compared to the southern market. So that is giving a lot of value addition or volume additions in our overall growth in Tanish Jain. Understood. And this will also promote a lot of, uh, intercity movement, uh, which will also have a favorable realization per ton. Is that— that understanding is also correct, right, sir? Correct. Okay, understood. Uh, fine, sir. I, I'll— I have more questions, but I'll get back in the queue, sir. Thank you. Thank you. The next question is from the line of Mr. Achal Lohade from Nuvama Institutional Equities. Please go ahead. Yeah, uh, good morning, sir. Thank you for the opportunity. Uh, so 2 questions first. You know, in terms of the volume growth, you said, uh, you know, 9-10%. That is for second half, but what about medium term? Uh, you know, are we talking about 9-10% or the 7-8% what earlier we used to talk about? Yeah, considering the present development what we are seeing from the market, the 9 to 10% is an achievable target even for a medium term, sir. Yeah. And if you could remind us, you know, what is the contribution of the new branches-led volume, you know, how it has trended in last 2, 3, 4 quarters, if you could give us some sense. And how do you see it, that playing out? Yeah, now the 60+ branches what we opened in the current year, those are contributing almost around 2% in the first half year. Out of the overall 10% growth in volume. Right, okay. Understood. So second part is, uh, you know, the fuel prices. If let's say theoretically fuel prices were to kind of come off, what happens in that case? Is there any automatic pass-through or, uh, you know, that, you know, you will be able to retain that benefit in that case? No, in that case, basically, see, with the contractual customers, most of the agreements as of today, we are having a fuel escalation clause. So based on that formula, whatever changes will happen, either it is increased or decreased, accordingly we have to pass it on to the customers. In case of non-contractual customers, again, decision is, you know, on us, and there actually we are having a flexibility considering the route-wise analysis and Uh, the region-wise analysis, we can take a call on the— or even some commodity basis, you can increase or decrease the rates depending on the fuel price. What's the contribution of the contractual customer, sir, in the total volume? It's around 17 to 18% revenue as of now. Understood, understood. Um, sorry, I missed on the margin. You're saying 21 to 22% is the new sustainable EBITDA margin? Have I understood right? Yes, yes. Okay, got it. Uh, thank you. I'll fall back in the Q&A for any follow-up. Thank you. Thank you. The next question is from the line of Madhur Rathi from Counter Cyclical Investments. Please go ahead. So thank you for the opportunity, sir. I wanted to understand how does, uh, increasing commercial vehicle prices affect our freight rates? So do we see a one-time jump or Uh, how does the market, uh, generally historically, how has that evolved into freight rate increases? Normally freight rate is not completely depending on the capital cost. Most of the freight rates are related to the, the fuel rates, actually how industry works in India especially. Most of the freight rate, you know, determines based on the fuel price increase or decrease. About the capital cost, yes, there is one time some minor improvement or increase or decrease will happen, but it is not a direct link with the freight rates. Got it. Uh, and sir, uh, if I were to look, uh, VRL from the next 2 to 3 years, because we are adding a lot of these branches, or should we How should we see the realization per ton or realization improving, uh, either via more long-haul routes, or would we like to continue our current, uh, route density in, in the sense that we are doing 7.5-8 times capacity turns, if you can help us understand. No, basically now the, the relation, the current year improvement, it is basically on account of increase in the freight rates. We did an increase at the beginning of the year from April 1st around 5%, and in mid of May we increased around 4%. So there is a 9% increase in the freight rates. So that is what is reflecting in the improvement in the realization. Now going forward, because of addition of new branches and new routes, that is not a significant contribution to the realization. The relation is directly related to the freight rates. No, sir, I was asking that would we like to move towards more longer haul routes where the realization is higher? For example, in our case, wherever opportunities actually we wish to operate, but it is not a short haul or long haul. Now, say for example, within the southern states, we are having more volumes within the state as well. So margin-wise across, if you take within state or interstate or intrastate, more or less it will be a similar number. Got it. And so just one question was on these land and, uh, land and building investments that we are doing, sir. How do we decide the IRR or payback of these assets because versus renting these out, if you can help us understand. यार इन example, the, the facility what we acquired in Bangalore and all, we worked very strictly on the IRR. So there actually the return payback period was in the range of around 10 to 12 years. But in smaller acquisition, normally it is on a need basis and it is based on the requirements. So there actually, there is some, you know, variance will be there, but in spite of that, considering the requirement of those assets, actually we acquired those assets. So how do we think about the overall ROC of our company? Because these are lower ROC asset if you can— if there is a 10 to 12 year payback period. No, considering our high margin business, definitely the ROCE will be much better. If you see, in the last year we did almost around 25%. Now considering the buyback and reduction in the capital, this year we are expecting our ROE— ROC will be at least around 30% plus. Got it. So that was from mine. Thank you so much and all the best. Yeah, thank you. Thank you. The next question is from the line of Krupa Shankar from Avendus. Please go ahead. Yes, thank you for the follow-up. Um, just one question on the fleet side, sir. So as I can see that the net addition of fleet has or rather you've scrapped more vehicles or sold more vehicles, and despite the underlying tonnage going up, right? So, so just wanted to get a sense around when do you start procuring fleet, given that you've given a favorable outlook on the, uh, tonnage growth as well. And the second part is that we've also seen that most of the vehicles which have been scrapped or which are reduced is also of the higher tonnage. So just wanted to get a sense around your fleet procurement strategy, if you would stick to your 15 to 20 or if the density is improving, would you prefer to go higher up? With respect to your sourcing around the 25 to 30 tons? Yeah, basically we are looking for further expansion in the fleet, basically on a higher capacity vehicles. Uh, going forward, and the numbers will be less, but overall capacity increase will be more or less equivalent to our tonnage growth. And predominantly, as a company policy, we wish to prefer to use our own vehicle or own capacity in the tonnage growth as well. To maintain, you know, good higher operating margins compared to outside vehicles. Understood. So, so is it fair to assume that, uh, um, you know, the scrappage of older trucks which we were doing it for last year and a half or so to large degrees, uh, is more or less the end of it. And from here on, you would see that the gross addition would be much higher than the, uh, definitely. Right, okay, okay, understood, sir. And, and, uh, second question, uh, was primarily on the profitability side. So, so we typically see the, uh, employee hikes coming through in the 3rd quarter. The past we have seen that, uh, any hikes, uh, or any cost elements which I missed out? Do you see any inflationary trend over there, uh, over the next, uh, next 6 months or so, sir? Yeah, we are examining, you know, again to consider the increment process. But shortly we'll inform about it. As of today, there is no specific timeline as such, but definitely we are working around it. Right. So do— as a broader sense suggests, do you feel confident now that incremental cost escalations, be it your toll cost increase or non-fuel cost increase can be passed on to customers. And, and this price hikes, what we have been taking quite consistently over the last 2 years or so would be a sustained trend over the medium term? That confidence is still there with the management? Definitely. See, now the EBITDA level reached almost around 23% plus. So considering all increase in toll expenses, other overhead cost, whatever it is, that impact will be not more than 1-1.5%. So considering given such increases, our EBITDA level definitely will be in the range of around 21-22%. Understood, sir. Understood. That's all from my side, sir. Thank you. Thanks. Thank you. The next question is from the line of Nitin Jain from Fair Value Equity Advisory. Please go ahead. Yeah, thank you for the opportunity and congratulations on an excellent quarter. Uh, my question is, uh, my question is regarding, uh, fuel prices. Uh, as we know that, uh, everything is quite volatile now, and for the last 2 days we have seen a, uh, we have seen a meaningful correction in fuel prices. Uh, so is there a possibility that if this situation persists, maybe in the next month or 2 months, uh, we might have to, uh, take a correction in our, uh, in the, in the fuel prices that where we have taken a hike in the last 2-3 quarters. Is there a possibility that we'll have to take a reduction, and what kind of impact do we see that having on, uh, our growth as well as margin. That's all from me. Thank you. Yeah, basically, see, if any fuel price changes— see, fuel price in India is completely regulated by the government. If any reduction on the fuel price, that too in a substantial number, at least around 5%, more than 5% or so, then definitely we have to rethink on the freight rates. If that is the scenario, and then definitely we can pass it on, that benefit, to the customers, considering our, you know, optimum level of EBITDA percentages, EBITDA margins as of today. So in that case, would we still be able to maintain, uh, our margin? Definitely. See, in that case, actually, we will have a further savings mode, means we can make some money out of it even though reduction is there. But ultimately, we will take a call and pass it on to the customer considering our optimum EBITDA margins as of today. We don't want to wish further make margin out of that. Right, right, right. And, uh, just one follow-up also to that, uh, so in that case, will the bulk purchases be, uh, become more efficient? Definitely. See, the bulk purchase as of today, what is happening again, it is directly linked to the crude oil price. Now see, the fuel what we are getting from the, you know, outside, if it is say ₹100 as of today ₹9,800, whereas bulk purchase, it is in the range of around ₹120-125. So considering this rate as of today, we are unable to buy the bulk purchase. If tomorrow, assume that the scenario changes, definitely that option will be always open with us. And whatever savings we will do out of the bulk purchase, that is again will benefit to increase in the margins, and no need to pass on that benefit to the customers. Right. And just one last one from my side. Uh, if we take a correction in the fuel prices, would, uh, would, would we see a temporary impact on the revenue growth then? Yeah, obviously revenue is a multiplication of volume and relation. If any small correction in the relation, that will impact on the revenue. Okay, okay, okay, that's very helpful. Thank you and all the best. Yeah, thanks. Okay. Thank you. A reminder to all the participants, you can press star and 1 to ask questions. The next question is from the line of Divesh Javar, an individual investor. Please go ahead. Hello, am I audible? Yes, sir. Please. Yes, sir. Yeah, so congratulations on a great quarter. Uh, I just want to check with the management that, uh, have we raised the CapEx guidance any further after a good 6th? Or we would continue with the CapEx RBI projected. Yeah, we wish to continue with the CapEx what we projected. Thanks, that's all from my side. Thank you. Thank you. The next question is from the line of Alok Deora from Motilal Oswal. Please go ahead. Uh, yes, sir. Just wanted to understand how the margin Because if we are going to do the similar volume growth in 2H, and if the cost structure remains largely the same, or can only Hello, can you hear? Yeah, please. Yeah, I was just trying to understand how the margins could shape up because if the, if the volume growth trajectory remains similar to what we have done in 1H and if the cost structure is— would be similar or rather can just improve marginally, so don't you think the margins could sustain at these current levels? And any reason why it could actually come down from what we delivered in Q3? Q2, sorry. Definitely it is sustainable, but because of some small increase in other costs, say for example the toll charge, some loading and unloading cost, or any, you know, change in the rates of these things, definitely there is a small correction in the margin. But as of now, considering these volumes and the current cost structure, whatever it is there, the 23+ margin is sustainable. But any increase in overhead cost or something, the To that extent, actually, there will be some small correction. Got it. And, uh, this revenue growth of 20% which we are seeing, which is combination of 9% odd realization and 10-11% volume. So this will continue through, uh, the 4th quarter, uh, I mean in terms of the realization improvement at least. And after that we'll see mainly the volume growth driving the revenue growth. I mean, there will be— I mean, unless we take any further price change, uh, the, the revenue growth will be more normalized at around 8 to 10% kind of a number. Is that Understanding correct? Yeah, in that sense, actually, we can expect at least around 10 to 12% growth in the revenue. Assume that there will not be no price relation change or something. Basically, one thing what will happen, uh, see, we are expecting the tonnage growth in the range of around 9 to 10%, that's one. And whatever correction in the realization from Q1 to Q2 now Again, that will also lead to some 1 or 2% increase in the revenue. Okay, okay. Yeah, so, so overall, uh, yeah, assume that if there is no change in the realization from now onward for the next year, at least, uh, the guidance will be the revenue will increase at least around 10 to 12%. Got it. And the— with 10 to 12%, the margins will kind of be at around 21% or so. 21-22%, definitely. Okay, okay. Got it. So just a last question. So, you know, we have been delivering these margins which are not seen anywhere in the industry, uh, listed or even unlisted side. So how are we sustaining that? I mean, it's since been many quarters since we are doing almost 19-20%, and now we have moved to a new trajectory of 23%. So, and now, you know, even for this year and even next year, we are maintaining a 21-22% kind of a range. So how are we kind of doing this? And if you could just spend a minute on this, whether what is actually making and how much is, uh, how much is, what is making this possible and how much of this is due to our internal, uh, you know, cost-saving initiatives or strategies, and how much of this would be more of market-driven where things can also change in future? Yeah. See, one is, uh, see, our service level is excellent as compared to other operators in India. Just I want to give one example. Say during the month of this October It was a very peak season of festival. The most of the textile goods which are booking from Ahmedabad to Surat, many of the competitors or many of the operators, they were unable to book the consignment because of non-availability of the vehicles. In our case, what happened, we have never stopped even single minute that the booking has been stopped in these locations. So because of own infrastructure facility, because of the, you know, the network what we are having today, because of the customer base of 10 lakh plus customers, without depending on any industry-specific These are all, you know, key differentiations between other operators in India. And because of this, whatever demand actually we made We, we are in a position to give the service. Our tonnage growth in the month of October is around 20% plus compared to year on year. It is a 20% growth in tonnage in October. Right, so these are the, you know, key differentiation as compared to other operators versus VRL. And when it goes to the freight rate to the customers, we are not charging any premium or something much different from the other competitor. But at a service level, we are much efficient as compared to others. See, our claim ratio is hardly in decimal as compared to the other operator. If you compare, it is at least in the range of around 10 to 12% claim ratio. But in our case, it is hardly any decimals. Got it. So you are saying that's the reason we are in a position to retain the customers. And moreover, whoever customer, because of a short period, because of some freight rationalization, they left us Again, they came back to us and started the business. And currently now our strategy, how we are changing, is see, for example, if any corporate customer, if we are providing, say, service in Karnataka or South States, then why can't in North? Why can't in West? We are identifying such customers and we are approaching at a top level to get all India contracts as well. Got it. So just last question also, if with this recent correction in global crude prices, suppose the diesel prices were to get reduced by, say, ₹5. And, uh, in that scenario, you also take a price cut of, say, approximately— where realization comes down by, say, 5%. Then how does the margin— how would the margin shape up? Because one of the key reasons for margin also has been the realization improvement which you— because of the price hike you took in 1Q. Now if you— if it is reversed partially, then how the revenues and the margin shape up? The margin will be again at an optimum level. See, margin will— it will support further, you know, little bit we can add to the margin. But always how the maths will work, for every ₹2 change in the freight fuel rate, there is a 1% change in the freight rates. Okay. For example, tomorrow if there is a 5% reduction in the fuel rate then there is a possibility that around 2.5% realization may reduce. Okay, okay. Yeah, and, uh, moreover, during that time again we will have some time gap and all, and selectively some routes wherever we do not have much of a competition we can retain our existing price rather than passing that benefit to the customers. And wherever we are having the competition, actually there, there actually we can pass on that benefit to the customer. Like that, you know. It is again a Some good exercise we have to do, and we have to effectively pass it on to the customers. Got it. But effectively, if ₹5 is reduced in the fuel rate, we can expect around 2-2.5% reduction in the realization. And in that scenario, the margins will be maintained. The margins will not change. Got it, got it. That's all from my side, sir. Thank you. Yeah. Thank you. That was the last question for today. I now hand the conference over to the management for closing comments. Yeah, thank you all participants. Uh, basically we are very confident on the tonnage growth. Just I mentioned, uh, in the last question, uh, see, our tonnage growth in the month of October, we reached almost 20% because of some good festival demand. And we also acknowledge from the market that some of the operators are unable to provide service whenever there is a very high demand in specific markets. Because they are completely depending on the outside vehicle or hired vehicles. Since we are having our own infrastructure, the own vehicle facility, wherever there is a peak demand in some of the sectors definitely we can take that advantage and that will further add to our volume growth. And considering the various cost structure, the change in fuel, or so many things Always we will monitor the expenditure very keenly on a monthly basis or regular basis, and we will try to maintain the EBITDA margins at least around 21% plus going forward. With this closing remarks, uh, I would like to conclude this call. Thank you. Thank you. On behalf of Motilal Oswal Financial Services Limited, that concludes this conference. Thank you for joining us, and you may now disconnect your line.