APAR Industries (NSE:APARINDS) Q2 2027 Earnings Call

0:02 Ladies and gentlemen, good day, and welcome to the Apar Industries Limited Q2 FY 'twenty seven Earnings 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 0 on your touch tone phone. I now hand the conference over to mister Amish Shibari from Essential Technologies. Thank you, and over to you, sir. Thank you. Good afternoon, everyone. I welcome you all to the h one and q two FY twenty seven earnings call for the APARINDS To discuss the business performance and outlook, we have from the management side, Mr. Kushal Desai, Chairman and Managing Director Mr. Chitanya Desai, Managing Director and the CFO, Mr. Ramesh Aliyah. I will now pass on to Mr. Kushal Desai for the opening remarks.

0:56 Thank you, and over to you, sir. Thank you, Amish, and good afternoon, everyone. We are very glad to have you all with us for the Apar Industries Q2 FY twenty seven earnings call. In terms of format, I'll start off first with the consolidated performance, then take you through some recent industry updates and post that run through each of the individual divisions' performance. At the end of this, we can open up for questions. Our consolidated revenue for second quarter FY 'twenty seven came in at INR 6,931 crores, which is higher than the previous year same period by 21.3%.

1:43 And compared to the sequential quarter, it is higher by 5.2%. Domestic revenues grew 34.3%. And exports, however, de grew by 3.3. I did want to point out specifically here that we had approximately 800 crores of conductors and cables, which are in transit and have been sold to customers on a DDP basis. Some of the product has remained in transit given the shipping time lines and the availability of containers that got pushed out to being a little bit later in the quarter. All of this product is actually scheduled to be sold in The U. S. Market.

2:33 As a result, The U. S. Revenue shows lower by 29.7% compared to the second quarter of last year. However, the order books remain at a very strong level at the end of this quarter. And with the realization of this GDP amount, you will find that by Q3, the situation the picture will look a little bit different. All our businesses have delivered strong EBITDA margins year on year with the biggest driver coming from the Oil Division. The EBITDA after open period ForEx adjustments rose 57.8% year on year to INR $7.87 crores, and the margin improved by two seventy basis points to 11.4% from 8.7% a year ago.

3:23 On the back of the strong EBITDA margin improvement, coupled with improved financial leverage, our overall net profits have risen year on year by 77.8% to INR $4.47 crores. PAT margins improved to 6.5%, which is an increase of two zero nine basis points compared to the previous year. If you now consider the first half of FY 'twenty seven, there has been a healthy growth with this being the highest ever half yearly revenue and profit. The revenue for H1 grew twenty five percent to 13,522 crores. The domestic revenue was higher than the previous year by 35.5% and exports grew by 3.7%, excluding, of course, this INR 800 crores that I spoke about earlier.

4:18 The exports proportion in overall revenue stands at 27.6%. The U. S. Revenue is down by 21.5% year on year based on whatever I explained earlier of the INR 800 crores in transit. The EBITDA post open period ForEx grew 60.2% to INR $160.02 crores with EBITDA of 11.8% in the first half FY 'twenty seven versus 9.2% in the first half FY 'twenty six. Our profit after tax for the half year grew 77.7% to reach INR $9.15 crores. The PAT margin has also improved by 200 basis points.

5:18 I will now cover some of the key industry highlights. During the first half of the year, India added approximately 8,775 circuit kilometers of transmission lines, which is up 153 year on year. In terms of transformation capacity, about 671,815 MVA got added during this period, which is up 52% year on year. In September 2026, the center has approved interest rate transmission systems to evacuate up to 135 gigawatt of renewable energy by FY 'thirty three, representing an addition of approximately 51,126 circuit kilometers of transmission lines and transformation capacity of 228,903 MVA.

6:17 This is essentially the third green transmission corridor, which has been announced. And the investment expected is to the tune of about INR 1,860,000,000,000. There have also been two other important announcements from CA of setting a 10 to 15% thermal margin limit for transmission lines versus the standard. So if a transmission line is the standard operating temperature, for example, is 70 degrees, then this limit would apply to 10% to 15% on 70 degrees, which gives the upper limit at about 80 degrees on which the line can operate. And mandating an n minus one reliability in terms of the architecture of the transmission network.

7:08 So given these two important changes, we expect that there will be an acceleration of reconditioning of lines taking place, especially in sections of the network where the electricity demand is growing. When you look at some of the major programs outside India, in The U. S, there has been the announcement of the Spark program, which is the speed to power through accelerated reconditioning and other key advanced technologies and upgrades, which was announced in September 2026 by the Department of Energy, where they have listed specifically 31 projects in 26 states, with a capital allocation of approximately $1,900,000,000 of federal funding.

8:02 This is expected to unlock 23 gigawatts of transmission capacity and will cover the conducting and rebuilding of about 1,500 miles of transmission lines and grid enhancing technologies of about 21,000 miles. Coming to the segmental highlights, I'd like to now take you through each of the divisions' performances. So if you look at the Conductor division, overall revenue for the quarter has grown 21.1% to INR 3,753 crores. This is led largely by the increase in the prices of commodities and underlying metals.

8:50 Volume for the quarter dipped by 9.2% over the same period last year. Domestic revenue is up 22% versus Q2 FY 'twenty six and eight percent versus Q1 FY 'twenty seven. Our exports increased by 18.3% versus last year and 29.5% versus Q1 FY 'twenty seven. Overall, exports constituted 23.6% of the mix for the quarter and 24.2% in the first half. But on a sequential quarter, it has improved from 20.5% to 23.6%. The U. S. Revenues for conductors grew by 12.2% in this quarter.

9:39 The premium mix stands at 39.4% in Q2 FY 'twenty seven compared to about 45.3% in Q2 FY 'twenty six. The EBITDA post open period ForEx grew 11.3% to reach INR $2.76 crores. The EBITDA margin improved on the back of execution of higher margin orders during the quarter, where the EBITDA per metric ton comes in at 48,241 per metric ton compared to INR 39,003 and 63 per metric ton a year earlier. On a half year basis, revenue is up 20.5% to reach INR 7,092 crores, whereas overall sales volume is lower by 8% compared to last year.

10:31 Domestic revenue and export revenue have grown by 20.720% respectively. The U. S. Revenue is down 8.4%. The EBITDA post ForEx is higher than the same period last year by almost 12.6%. So EBITDA per metric ton is at INR 50,739 per metric ton versus INR 41,421 per metric ton a year ago. So H1 witnessed a volume degrowth, as I mentioned, of around 9.2% as there continues to be delay in manufacturing clearances as well as awarding of new conductor orders from customers and especially PVCB awardees.

11:21 As you can imagine that there has been a significant commodity inflation in the form of the price of both copper and aluminum on LME, a higher premium like MJP, for example, on aluminum is the highest it has been in the last four years. And there's also been a sharp increase in steel for manufacturing of the towers. This is the second consecutive quarter in which we have seen the strength. However, it is important to keep in mind that TBCB orders have an execution period of not exceeding thirty six months with extremely stringent penalties on delays. Hence, there is only a finite time line in which some of this can be postponed.

12:10 It is also interesting to note that this past quarter, execution of existing contracts has been at a high. As I mentioned in my earlier part of the opening remarks, in exports, international freight rates had gone up very sharply in Q2. And there was also a very heavy demand and divergence of containers for China along the Europe and U. S. Freight lane. As we move into Q3, however, this freight trend has already started showing signs of reversal. And as a consequence, we should see a better situation in this quarter. What is also interesting to note is that the order book at the moment is at an all time high of INR 12,025 crores as of September 30.

13:04 The order book consists of new orders received during the second quarter FY 'twenty seven to the extent of INR 4,725 crores, which is higher than the same period last year by 82%. The order book includes several prestigious and new type of orders from utilities in The UK and The U. S. Of about INR 3,000 crores. This includes the first Z shaped conductor order from Scandinavia, which is actually very resistant in high wind conditions. And this is for evacuation from an offshore wind farm off the coast of Scandinavia. We've also received a new set of HTLS orders from overseas markets, which include countries in Africa, South America and Europe.

14:00 On the OPGW front, we received our single largest order and the first of its kind with a 48 fiber OPGW from KPTCS, Karnataka Power and Transmission Corporation Limited of about INR $9.60 crores using a new communication technology, which is IP MPLS or it stands for the Internet Protocol Multi Protocol Switching System that improves not only the speed, but also the security of data transfer. We also received our first OPGW order with 144 fiber in it from a customer in Central America.

14:48 This is an extremely important strategic milestone because higher OPGW fiber count is going to be the order of the day with the data centers coming in and the amount of transmission of data exponentially likely to increase. Approximately 25% of this INR 12,025 crore order book will be staggered over two to three months, with the rest of the order book likely to be executed in a period of less than eighteen months. It is also our expectation that the second half will see much more aggressive execution in transmission lines, and we are gearing up for the higher volumes in H2. To sum up, the structural demand drivers remain intact, and it is only a matter of time when the flow order execution will take place to catch up to the final delivery schedule of the transmission projects.

15:46 Coming to the Oil Division. Revenue for the quarter came in at INR $18.19 crores, which is up 35.6 year on year, 6.7% sequentially, led by higher realization on the back of higher base oil prices. The operating revenue continues to be extremely challenging and volatile, characterized by record refining margin spreads. This is having an overall impact on the business, especially considering that the value of billing has almost doubled on a unit basis. And so it is more prudent to actually limit the sales to whatever is the maximum exposure limit set up and limited by the number of days of outstanding, given the fact that clients today have to pay double the cost of what they were paying earlier and the fact that it is not easy to get double the financial limit.

16:53 So considering this prudence in terms of how much we would be willing to bill to customers and what exposures we would be ready to take, we see that the overall volume is down to INR 128,590 kl for the quarter, which is about 20% lower than the same period previous year. Our business out of the Hamriah plant has substantially reduced because of the logistics of bringing products in and out. Some of that export has been transferred actually to India and we continue to execute those orders from India. Exponses of proportion in the oil business is currently at 37% compared to 43% a year ago and 36.4% last quarter.

17:43 EBITDA post foreign exchange grew to grew by 185% to reach INR $2.99 crores. The EBITDA margin stands at INR 23,262 crores per KL in the second quarter FY 'twenty seven versus INR 6,517 crore a year ago. Half yearly on a half yearly basis, revenue has reached INR 3,525 crores, growing at 35.3% versus last year. Volumes in the same period have fallen by 16.9%. Export has grown 23.5% year on year and the export mix stands at 36.7% in the second half of FY twenty twenty seven in the first half of FY twenty twenty seven.

18:36 Since the inception of the Middle East conflict, we have changed the operating philosophy to focus on executing higher margin orders with customers who have been consistently buying from APAR and ensuring that they receive consistent quality with uninterrupted supply. This has led to a reduction of spot buying of base oil and the reduction of sales to customers who are significantly more price sensitive, have an erratic purchase pattern or where we feel that there are limitations in terms of cash flow. And by following this, the margins have increased even though the volumes have dropped to some extent, but we have protected ourselves quite significantly in such a volatile environment.

19:27 Now moving to the Cable division. Revenues reached $18.75 crores, which is representing a growth of 22.1%. Copper is about 30% of the overall revenue mix as compared to 20% a year ago. Copper prices are up by almost 50% and aluminum prices have gone up by almost 35% during the quarter. Consequently, the metal prices along with volume has led to about a 35% to 40% increase in the sales value. However, our U. S. Sales number de grew by 50% over last year, which brought the overall growth down to 22%.

20:15 This quarter, we, as I mentioned earlier, have an unusually high value of cable, which are amounting to over INR $4.40 crores, which are in transit, for which the sales revenue could not be recognized as the in core terms are on a DDP basis. The incremental excess transit value, that is the transit value of the INR $4.40 crores minus what existed at the beginning of the quarter, represents almost 20% of the sales value. Considering this number, it will put the entire manufacturing dispatch and the lower recognized U. S. And overall Q2 revenues in the right perspective. If you look at the domestic business, there the revenues have come increased by 71.4% in cables and 14.1% sequentially.

21:10 Exports came down to 45.2% and is down 29.8% compared to the first quarter. The export mix stands at 19% of Q2 FY 'twenty seven compared to 42.3% in the last year. The EBITDA margins have improved by 80 basis points to 11%. Moving to the half yearly performance. Revenue has grown 25.7% year on year. Domestic revenue is up 65.8%, but the export revenues are down by around 30.2%. The EBITDA post ForEx stands at INR $40.01 crores, representing a year on year growth of 34.2%.

21:58 The EBITDA margin stands at 10.8%, which is 70 basis points higher than last year. The cable order book also remains very strong at 3,000 crores of orders compared to INR $16.53 crores and bulk of these orders are expected to be executed before the end of the year. We have also received almost INR 1,000 crores of orders from Google data center in The U. S. Amazon's largest data center, which is coming up in India. During the quarter, we successfully completed another round of QIP, raising INR 2,500 crores. The proceeds of this will be deployed towards improving working capital and strengthening the balance sheet, thereby enhancing our financial flexibility and supporting our future growth initiatives.

22:53 As a consequence of this fund raise, our rating has been improved by one notch from AA negative to AA, which is an important development to help us access larger finance limits and also rationalize borrowing costs. So in conclusion, in spite of a challenging operating environment, business momentum is still strong as reflected by the order books of our Conductor, Cable and Oil division. The data center CapEx cycle is still building up, both overseas and in India. We also see freight rates, which are sharply increased to Europe and LatAm starting to ease, making exports to the geographies more feasible.

23:39 The medium to long term trend remains intact and could, in fact, accelerate in the months to come. At this stage, we are confident of our performance during FY 'twenty seven. I would like to conclude my opening remarks with this. Once again, thank you all for joining this call. Before we open the floor to questions, I'd like to extend a warm greeting to all of you and your families for the upcoming festival season. So with that, we would be happy to start taking questions. Thank you very much. We'll now begin the question and answer session.

24:27 May press star and 1 on their touch tone 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'll wait for a moment while the question queue assembles. The first question is from the line of Nitin Apar Industries Axis Mutual Fund. Please go ahead. Hi. Thank you, sir, for the opportunity and very strong set of order book. Just first thing on the profitability on the aluminum side because first half itself is pretty strong, averaging 48,000 to 50,000. How we are thinking about this year profitability because your guidance has been around 40,000 for this year?

25:19 And also, if you can just articulate apart from your guidance thing, the premiumization because the order book which you the few orders which you spoke about looks like a very premium end of the market, which is it coming from. So I know you guide every year for that particular year, your EBITDA per ton for aluminum. But directionally, if you can tell us a little bit that given if my understanding is correct, I. The profitability should improve or rather how we should think about it? So that's the first question. So the premium mix has been high in quarter two as well as it was high in quarter one. And within premium mix, there are different categories of conductor.

26:07 Each has a different margin profile depending on where we sell, whether it's domestic export type of customers, the margin profile varies. By and large, the more premium range of products we have, the margin should improve. But depending on specific cases of sales to customers, the margin profile within the premium mix also change. So as we have been discussing in the past, in terms of exactly estimating the EBITDA margins, it may be difficult, but we can give a range, which is what we have been always talking about 35,000, 36,000 plus tailwinds. And these tailwinds keep on coming depending on the product, service margin and execution as well as the geography in which it has been sold. So the to just add to what Ramesh says that, yes, there are some very premium orders and some of them for the first time, like the Z shaped conductor, which is going into Europe.

27:05 It's manufactured so far by only two other manufacturers of conductors in the world. Obviously, this is ending towards more premiumization. We have to complete executional orders, get all these things installed, etcetera. Also, for the OPGW, which we got for Karnataka, it's a very big job on a complete turnkey basis right from design to delivery. It is also going to incorporate this new technology for which Apar has tied up with Nokia. So this is continuing to go there. Expectation is that margins from these products will continue to be better. However, the environment, as I said, there's so much volatility, you have suddenly MJP at a four year high.

27:57 You have freight and certain freight lanes suddenly again Latam and Europe multiplied by two to three times in the short term. So I think the strategy which Apar is following is, and you'll see that even as I had mentioned in the operating philosophy of the oil business, that we are trying to be very selective in such a volatile environment of the quality of business which we are taking. Because if you work with lower margins, suddenly these impacts happen and it completely can wipe out whatever profitability that you had. Fair point. For things which are beyond your control. So yes, we hope that this volatility starts reducing and some of these walls and aggressions drop, in which case the volatility goes down and there's an automatic cushion that's built into the system that no longer needs to be used.

28:51 But considering all that, I think I would just summarize saying that we continue to push hard and there is a lot of opportunity coming in for more premium products as we go forward. As you may have picked up from the opening remarks, these changes that CA has made, they are actually very big changes in terms of the operating quality of the network in India. So by keeping a control on the amount of the temperature, right, you're controlling essentially the amount of power that's being transferred across the line. And you don't want overloading of the line to take place. So a simple way of measuring it is by measuring temperature. They've also brought in the redundancy, the n minus one, which I mentioned.

29:39 So accordingly, you're bound to have secondary transmission lines coming up. You're bound to have reconducting taking place. The U. S. For the first time has formally announced a program, which is Park, as I mentioned, with specific programs in place. This fund of $2,000,000,000 is going to help complete the CapEx on these, however, there is gap funding and things involved and a higher technology here to be picked up. So there is a lot of excitement in terms of the way premiumization is happening. I think time will tell how it actually translates into finally the EBITDA per ton. Got it. It's a very long half. So I have very no, sorry. Have very helpful overview of what is happening. Yes.

30:24 Yes. So it's very helpful. So this year, the guidance still remains at 40% or because the first half is strong, so where we should land, how we should think? Normally, Nitin, we don't give guidance guidance for the quarter and for the year. Typically, a lot of order books are MTO based. So we give a guidance from medium to long term perspective because of the nature of the business and the complexity, it's not easy possible that we give guidance for the quarter. But we expect tailwinds to come. And that's why our margins are in line with our guidance. Sure. Just one more question here, Ramesh, to you. When we look this point in time, we understand because aluminum is pretty huge, and we saw in some of our auto ancillary companies working with aluminum.

31:10 The working capital bloat was pretty high this quarter specifically. Is this going to normalize? And is it the right understanding because of high inventory of aluminum, aluminum also got reversed, so that would have also have impacted you? If you can throw some light on this balance sheet aspect of working capital. So I'll answer the specifics on the on you know, so see, we've been keeping an extremely strong control on both debtors as well as inventory. And aluminum is up by 35%, 40%, copper is up by 50%, base wise are up by 100%. So there has been a huge inflation on the raw materials. It's clearly not every customer has actually been able to build enough financial muscles and cash flow to be able to handle this. So that is also one of the reasons why there is a little bit of a reduced volume sales because you want to limit the way in which you run the business to make sure that cash flow is not coming under any form of pressure.

32:14 So it's not really had an impact on the amount of inventory which we hold in. We pretty much control it in terms of the number of days outstanding. The physical value, obviously, has gone up because of the commodity value. And the customer the way in which you handle dispatches and supplies to customers has necessarily had to change to make sure that the company is not put at any additional risk and the cash flows remain good. Thank you very much team. I'll come back in the queue. Thanks a lot. Thank you. The next question is from the line of Mohit Kumar from ICH Securities. Please go ahead. Yes. Good afternoon, sir, and thanks for the opportunity.

33:01 My first question is on the Reconducting opportunity. Personally, used to think that Reconducting is likely to grow at a very, very fast rate, But you're looking at the IMR data for FY 2026, and I thought it was looking more like flattish or a decline. My question is, are you seeing improvement in the order inflow outlook in the domestic market for HDLS? And is it fair to expect that the margin which you have on the HDLS is much, much higher than the average margin we report for the connector segment? So in the HDLS side, the lot of tenders have come out. Only thing is that some of them have taken more time to get formally processed through their utilities, board meetings, etcetera.

33:57 So generally, we see a growth in this segment. There is more competition also coming in. That also is a factor. But overall, the size of the pie is growing. So while our market share may reduce, we will still not have a reduction in our volumes and revenue on the HDLS side. Moiz, as I mentioned in the opening remarks that the amount of basic changes in the market is which is favoring HTLS is increasing. Just now the two changes that I mentioned that CE has made, which is very recent, it's within the quarter. So it will take some time for it to percolate down, but it has very far reaching consequences in terms of where this will be applied. Even as I mentioned in The U. S, The U. S. Was even though these patterns were all originally fine in The U. S, the market there was quite limited. Now with this and with all this data center growth happening over there, you will see increasingly more HTLS going in there as well. So I think being the largest player in the world on HTLS, we are actually in a very good position.

35:14 And whereas you may not be able to predict quarter by quarter, but the trend is looking very strong. Understood. My second question is on the CTC Conductors. I think that it is kind of I think we have we had just brought in the capacity. This particular segment seems to be seeing a very high growth. Can you just help us with the outlook here? And are you exploring the export markets for the CTC especially? And are the margins much better than the average margin you report? Okay. So there are two questions, I'll take them one by one. So a, the basic demand for GPC is continuing to grow. There has been a lot of capacity that has come on stream, both at APAR as well as some of our key competitors.

36:05 Having said that, the CA is contemplating increasing where CTC can be used. So not only they're looking at more and more transformers, which will need CTC in it simply because of the better performance that comes from CTC versus PICC. Apar has already started looking at exports. We've got some trial orders from customers in The United States. We are at very advanced talks with customers in the in Europe. We have signed up a whole set of customers in The Middle East prior to the war breaking out. And we continue to shift to some of them, but obviously their volumes also have to some extent been affected due to the current environment.

36:51 So in short, there is a good demand for CTC. I think the new addition of CTC capacity outside India is slower than the way the demand is going to increase in those countries. So we are working towards that. We did have a little bit of a setback in Q2 as far as CTC is concerned because there was when the very heavy rains came and hit Silvassa, one half of our CTC complex was the one that was the one that was really badly affected compared to all the rest of our cable and conductor manufacturing. So as a consequence, we were down the capacity was down to the extent of almost equivalent of twenty odd days or ninety days.

37:40 So that affected a little bit in terms of what could have gone out in this quarter. But otherwise, yes, the export side is something that we are looking at, and I think we will see good traction coming from it. And I'd like to add that some of the transformer customers' expansions have got somewhat delayed. So when that book to file, then again the CTC volume offtake will actually materialize to the extent that we had envisaged when we put up the CapEx for the expansions. And any color on the margin, sir? Is the margin better than the average margins? It's about similar. So you will see a little bit of falling off of domestic margins just simply because capacity there will be adequate capacity coming in place.

38:33 The margins will improve for very specialized product. So if you see when you go to 400 KV, seven sixty five KV, there's more HVDC, which will come forward in the next five, seven years. So that's where you will get higher margins. But for a like for like basis, given that the capacity has increased, supply has improved, the domestic side, you will see a little bit of a drop. The export side is about similar because right now, some of this premium that you're getting is getting eaten up by freight and logistics. So when those prices fall, then obviously, your ex factory netbacks will improve. Understood, sir. Thank you and all the best. Thank you. The next question is from the line of from Nomura.

39:29 Congrats for a very good set of numbers. My first question is pertaining to bookkeeping. If I look at probably trade payable, I think it has increased on a year on year basis from about, I think if I look at for March 26, it was about close to 109 days. Now it is lower at about eighty one days. So basically, this reduction is largely because of deployment of raised funds into reduction of customer acceptances? Or is it pertaining to your higher payout towards vendors? So we have deployed the QIP money for the purposes for which we have raised, which is working capital. So we have resorted to cash purchases of raw materials, and that's the way we have deployed the money. And therefore, you are seeing that trade paper number of days is lower than what it was in the past.

40:29 So could you please give me the number for acceptances as on September 26? It's around INR 3,500 crores. Okay. Understood. Understood. And second, if I look at probably our CapEx for first half, it was closer to INR 500 crores, given that you mentioned in the last call that total CapEx that we are planning is about closer 15,000,000,000. And there is also a possible CapEx that you are exploring outside India. So how should we think about CapEx number for full year FY 'twenty seven and INR 28 crores, 29 crores? So we are looking at the CapEx around INR 1,500 crores.

41:14 That's what that was at the beginning of the year that would have been spent over the twelve to fifteen months or so. So now we are close to about INR 500 crores have already been spent on that front. And once this phase of CapEx is over, then probably our CapEx spend would be less because this is we are stepping up the capacity, and therefore, we see a buildup of the CapEx amount. Probably once this INR 1,500 phase of CapEx over then we on an annual basis, we expect that CapEx would be in the range of INR 300 crores or so INR 300 to 400 crores also. It does not include any of the I mean, this INR 1,500 crores is a domestic CapEx. We have still to make any major we are still in the process of looking at closing the loop for the overseas side of expansion.

42:10 These are fairly advanced, but we still have to close on that. Understood. So is it fair to assume for this year, probably CapEx could be about INR 10,000,000,000 and remaining INR 5,000,000,000 kind of extending towards FY 'twenty eight and then over and above this probable capacity expansion outside India? So we stick to the India figures for now because that is what we have been talking. So it's about as I said, about INR 1,500 crores towards the beginning of the year to have been spent over the next twelve to fifteen months or so. Sometimes the CapEx gets delayed by a quarter or so. So that is where it could be. But largely, it could be about INR 1,500 crore for twelve to fifteen months, and out of which we have already spent INR 500 crore as of now.

42:59 Understood. And there is also a proposal to invest up to about $100,000,000 now into PSPL. Earlier proposal was to invest close at about $10,000,000 So any reason behind this change in proposal? Yes. So it's our PSPL is our wholly owned subsidiary, and it also has having all our operations under this Singapore entity. So we are funding the entity at this moment. So is this an enabling resolution that has been taken considering that there are we are looking at various options of expansion overseas.

43:46 So we've just taken an enabling resolution at this stage. But is it fair to assume that these enabling provisions are more pertaining towards probable expansion outside India or in opening up... This is pertaining to expansion outside India, which we are looking at the moment. So the details of that, we will pay as and when it is required to be done. But for now, it's an enabling resolution for investment funding the subsidiary of the company. Understood. Last question is on strong orderings that you had in the quarter gone by for cable as well as conductor business, especially I think cable where your order book has now gone up to almost INR 30,000,000,000 plus, It was hovering always in the range of about INR 60,000,000,000 to 90,000,000,000 in the past.

44:40 So what explains this, because we also mentioned that there is material room for improvement from export market in cable business, which is yet to come. So how should we think about ordering number on cable side probably one year down the line or two years down the line when that piece of business ramps up for us? And on the conductor side, any large order that you booked in the quarter gone back because your number was again higher, closer to 50,000,000,000 for Q2? So I think, okay, on the cable front, we are pretty much on track to grow the business 25% year on year.

45:26 The higher order book has come from the single largest component in there is data center products going into data centers. I specifically mentioned about Amazon's new and what is going to be their largest data centers in India, two locations, for which we have received orders, execution will happen between now and the end of this financial year. And we are expecting more orders from that same site. We also received over INR 1,000 crores between the AWS and the Google data center that I spoke about. So besides that, there are more orders that have come in for renewable energy, both solar and wind.

46:12 The railway order book is up. So generally, all the sectors which we have been talking about that Apar is focusing on, we've seen improved order book in all of those sectors, but products going into data centers, the cable going into data centers being the largest chunk of this. And you will see The U. S. Side of the business picking up because the order books coming in from there have now started filling in. And the execution, as I said, there's already over INR $4.40 crores of cable switches in transit, which will physically hit the books in Q3. And there is a good pipeline of orders that is there, including orders that have been booked as part of the INR 3,000 crores. On the On the conductor side? On the conductor side, we have won a few big orders.

47:09 And one is already mentioned about the OPGW from the Karnataka Power Corporation. And also some export orders also have been won, both in The U. S. And in Europe. So that also is included in our order book. And the staggered delivery will take place over a couple of years in that case. Understood. And if I look at probably EBIT margin EBITDA margin for Copper cable business as well, I think it is now closer to 11%. And if I look at probably, as you mentioned, incremental orders, which are from PC or from export markets, so probably margins could be even higher. So is it fair to assume that our cable segment is also moving towards 11% to 12% EBITDA margin profile going forward?

48:00 So our target is to get to between 1112%. And we are trying to move in that direction. As I said, the volatile environment is creating a set of leakages, especially with respect to freight and premiums on metals and even steel prices have suddenly shot up, etcetera. So but in spite of all those challenges, you'll see that in the quarter, we've delivered 11%. And clearly, the aspiration is to be between the 1112%. We've actually publicly stated that. So we are actively working towards that. Got it. Got it. Thank you. Thank you so much, and wish you a very happy Diwali in advance. Thank you. Yes. Thank you.

48:51 Thank you. The next question is from the line of from Asian Market Securities. Please go ahead. Hi, sir. Thank you for the opportunity, and congratulations on a great execution. So firstly, on the cable side, you have mentioned that you have secured close to 1,000 of orders linked to Google's U. S. Data center and Amazon's upcoming India data center. Just wanted to check how significant could these data center related cables become in the overall business two, three years down the line? And wanted to know, do these projects offer a better margin than the company's conventional cable portfolio? So the I mean, the end target segment is data centers. But as I mentioned in various public forums and conferences, the construction and composition of The U. S. Market is completely different than the Indian market, even if the same name is involved.

49:49 So The U. S. Data center cables are definitely offer a better margin profile compared to a similar product being sold in India because of much higher spec. The Indian data center side, you are getting a very large addressable market, but the competitive intensity is much higher than and the margin profile is much lower than India exports, just simply arising from the nature of the construction of the cable and the complexity that goes into manufacturing. But it will remain and it will be one of the largest segments which are growing. So you will see increasingly a presence. Keep in mind that really in India, there are no AI data centers of any size are operating yet.

50:39 And as these come on, you will start seeing some of The U. S. Type specifications also finding their way into this market. Time will tell whether what are the final premiums or margins that you land up with. But I see that over a period of time, especially where GPU based data centers, which are used for AI and training, they require a much higher spec given the amount of current electricity and the utilization that the data center has relative to an enterprise data center, which is largely CPU based. So even though data centers, there's a lot of variation and variety in that depending on the geography and depending on the type of data center. But it will be a large addressable market. And The U. S. Side will be at a premium compared to India simply because of the complexity of its construction.

51:34 That's very helpful, sir. Secondly, on the conductor business, you, in your opening remarks, mentioned that the manufacturing clearances and the fresh order awards, there's a delay, particularly from the TBCV awardees as a key reason for the decline in the volumes. So with the order book already at INR 12,000 odd crores, have you started seeing any improvement in clearances in the order awards? And what sort of volume growth can we expect in the second half? We expect we are seeing a reversal of the trend, and we expect that because Q3 and Q4 are the peak seasons for completion of various projects. And there is a finite time line beyond which customers don't want to delay.

52:19 So we feel that this trend should reverse. This decline should get arrested by next quarter. And we expect that quarter three and quarter four should be strong than quarter one and two in terms of the volume numbers that we talked about. Did mention in the opening remarks that when you get a TV CV award, you have basically 36 end to end. So there is a little bit of leeway, but there is a finite leeway because if you don't complete execution at the end of thirty six months, the penalties are very, very severe. So and you may have picked up that what also is actually available is that the execution of existing orders and the delivery of transmission lines during the quarter of older contracts has been at an all time high, it's 153% more than it was the same period a year ago. So it's clear that a lot of people are focused on executing and completing their existing projects.

53:25 They have delayed some of the work on new projects because of the inflation. But there is a finite time line beyond which they will just have to press the button. So I think that is the layout of the current situation. Got it. So that's pretty helpful. Lastly on the oil business. So let's say if the base oil prices remain elevated, could we expect volume to remain subdued for the longer? And continuation of this, are we still sticking to the growth guidance, which was given a couple of quarters back for all the three divisions? So we see clearly the conductor business, you will see a catch up in the second half in terms of volume. The cable business, we've been guiding 25% value growth. We are quite confident that we'll meet that on exceed that. If you take factory dispatches, the figure looks very different because of this INR 400 odd crores of in transit products.

54:25 On the oil side, that's the one area where, as I said, in terms of operating philosophy, we don't want to change volume. We want to fundamentally change the quality of the business, which consists of higher performance grades, good customers, focusing on making sure that they receive the right quality of product. You see, refineries are being forced to switch the crudes that they are using as well. So it's no longer like whatever you got from a refinery for the last ten years, in this last quarter, you're getting exactly that. Because if they've had to change some of their crude input, the base oils coming out of them are bound to receive some variation. So the whole focus that we have today is to preserve the quality part of the business. We know clearly that there are a whole range of our customers who, a, are price sensitive. We don't have the financial capability of maintaining the same payment terms and things like that, given the fact that product prices have increased. So our whole operating philosophy has changed to margin ROCE and focusing on the quality of the business as opposed to the volume of the business.

55:37 The lubricant side of the business has done already, and it has grown at more than the 7% that we were targeting. So that's the industrial lubricant and the automotive lubricant side. Got it, sir. Thank you so much and Diwali greetings to the team. Yes. Thank you. Thank you. The next question of is from the line of Apar Industries from go ahead. Yeah. Good afternoon, sir. Thank you for the opportunity. First question, you know, if you could give us some sense in terms of the utilization of our conductors, cables and the oil division, please, for 2Q?

56:25 So on the cable side, we the existing capacity has been largely utilized other than a few areas. So overall capacity utilization is in excess of 90 plus percent with some sections running at 100%, 105% capacity, especially those where we use copper products that service the data center orders. So that part of the business is running quite flat out. Conductor business utilization, it should be about 80 percentage. And keep in mind that CapEx is going in and expansion is taking place as we speak. Every quarter, there'll be increased capacity coming. So capacity constraint is not the main it will not be a constraint.

57:19 We are we've made sure that we invest a little bit ahead of the curve and the capacity is there. Today, it's the operating discipline that actually is limiting the way in which you're doing business. In some cases, the conductor side, it's the customer having to press the button on when they want the manufacturing clearance to be given based on what they can afford. But I wouldn't look at physical capacity as being a constraint either oil business, so it's not a constraint. And even in conductors, it's not a constraint. And cables is there in certain sections, which we are putting in new expansion. So as you end this year and move into next year, I think capacity should not really be the biggest problem.

58:07 Got it. Is it possible to get some sense in terms of the industry growth from a medium term perspective for the conductors, domestic conductors, cables and the oil division? So in general, we expect the conductor division from an industry perspective, of course, excluding some of these aberrations that we are seeing in this metal price moment. But in general, we expect the industry also to grow by about 10 percentage, excluding all this one off effect that we are seeing. How about the dividend? The growth can be measured only by rupee terms. So if you look at constant metal prices, you're looking at around between 15 odd percent growth.

59:04 There are some companies which have strong brands, strong distribution, a good product portfolio where the percentage of growth is a bit higher. And small scale and some of the other guys who have very commoditized offerings are actually seeing a drop off. So overall growth is around anywhere between 1520%. And in the case of oil and lubricants, transformer oil is probably in that 57% range. But the other products are in the 2%, 3%. So overall, that's why we've been guiding 5% to 7%. Though in the current scenario, we are limiting the business based on whatever operating discipline we want to employ. Got it. In terms of the export market, if you could talk a little bit about the competition, particularly from the Chinese competitors, how which scenario is playing out there?

1:00:02 So there is still a significant arbitrage between the Shanghai Metal Exchange and LME, which gives a fundamental benefit to Chinese conductor exporter for that matter or even a cable exporter. So that competition is quite severe. I mentioned that in our opening remarks as well. But having said that, there are these other pockets from where we are concentrating on customers in The U. S, customers in Europe, Latin America, where the level of either the type of product or the type of the transaction is something that's not so suitable to do with the Chinese players. Like for example, we have these contracts, INR 3,000 crores worth of contracts from utilities in The U. S. And Europe that are like on a rate contract literally spread over two to three years.

1:01:02 So those sort of deals are something where Apar has built a very high level of credibility relative to some of the other international suppliers. And therefore, it puts us in a better position to sign such type of contracts. So otherwise, if you look meaning standard products, shorter delivery cycles, things being quite simple, the Chinese competition is definitely very aggressive. Got it. And just last question, if I may, with respect to the oil division. This quarter also, we have had a substantial margin, a little lower than Q1, but substantially higher than the past average. So could you please clarify? And how do we see it going forward?

1:01:52 So there is definitely a positive spin that there in terms of unit margins because what we have done is we've largely been concentrating on buying on contract versus buying on spot. So these spot prices are fluctuating all over the place. And as a consequence, as I mentioned, we changed our operating philosophy. We've been taking the contracted volumes and the best quality ingredients that we have and focusing on the highest quality of customers and business that we have. So going forward, we are I mean, there is clearly a premium that's there on the margins in the shorter term. It's really I can't really tell what will happen if the war gets over. Having said that, it doesn't look like anything is slowing down right now. So the same operating philosophy will continue.

1:02:49 We will limit the amount of purchases we have and we'll focus on the quality of business. Because the lower end of the business in terms of lower quality applications, lower quality customers and lower quality, I mean, by the price they're ready to pay and the payment terms, etcetera, it's quite dangerous to put too much emphasis on that segment according to us, given that this volatility is not likely to change. Got it. Does that answer your question? So we are not looking at a volume game at all What on the I wanted to kind of understand a bit more clearer is that, is there like Q1 had inventory gains, right? Is there any element of Q2?

1:03:41 Or we should assume this is a new normal margin? There is some amount of gain that has happened in Q2, but there was also a massive if you see the oil had dropped very substantially just before the quarter, right? In the second half of June, it had fallen very dramatically. And then after that, it has really bounced back. When you buy on contract, have a more steady supply and a steady price. When you buy on spot, you end up buying cheap for a few days and then right now you're buying very expensive. So there is a little bit of benefit that's coming from the way in which Apar has been conducting its business. So by no means are these are normal margins which are there. Got it. Thank you. Wish you all the best. Thank you. Yeah.

1:04:32 Thank you. Ladies and gentlemen, in order to ensure that the management is able to address questions from all participants in the conference, please limit your questions to two per participant. The next question is from the line of Amit Anwani from PL Capital. First question on the volumes. So despite volumes decline and in terms of value also, the premium coming down, we are still able to maintain a very strong EBITDA burden. So at least on the volume side, wanted to understand, is the volume contribution from premium continues to grow and non premium is kind of moderating despite the volume decline which we have reported in H1.

1:05:33 And you also highlighted winning few contracts of HDLS in the overseas market, which I believe is premium and premium not not used to be the big part of exports. So can we expect in H2 and maybe next year, the volume wise premium portion will continue to increase in the volumes? Yes, Amit. So as we have been saying that, no, this trend, expect it should get reversed because utilities will have a finite time up to which they can postpone. So clearly, as you've been seeing or hearing us, we have a very strong order book. And it's very clear that these are temporary phenomenons in which because of high metal prices, the volumes are low. It's not there's no change in the structure or the demand per se, but it's just about timing. As everyone is expecting the war to get over and prices to come down, customers are evaluating whether they should complete the project now at a higher metal price or wait for a few months by which the price will come down. So they do evaluate between the prices of metal and the damage that they need to pay for delayed completion.

1:06:51 So these are temporary phenomenons clearly. And the strong order book is a reflection that there is good demand in the market. We do hope that second half of the year should be better than the first half of the year from the point of view of customers wanting to complete their various projects. Otherwise, they would be saddled with huge LD. And therefore, we expect this execution to turn. We expect this trend to reverse in the second half, but we'll have to wait and see how exactly it will happen and how the order up lifting will start from the customer's point of view. Regarding the premium product and margin, yes, we have been saying that there is a volume decline and a large part of volume is also relating to nonpremium products because the premium products have a little bit of service element also.

1:07:43 But we are seeing both decline happening in the first half of the year. And despite that decline, whatever the remaining volume is available, that gets split into various premium categories. And as you know that there are multiple premium products that we have in our basket. We are able to deliver a good mix during this particular quarter that has helped to compensate the drop in the overall volume numbers in quarter two. So that at an EBITDA level, we are still able to be above what we reported last year. All right. And in terms of the overseas pipeline in premium, you mentioned HDL has been in Africa. So how one should look at the overseas pipeline now for the premium conductors? Yes. It is also increasing.

1:08:34 We are increasing our product lines in overseas market. And we will see growth coming in, in future as we make more inroads into the overseas market, which is the premium offerings. As you saw that there's a lot of focus in The U. S. On this part program, it's all about reconducting line and improving the current carrying capacity limiting losses. So we see that trend will increase in the market place in times to come and our expansion of product offerings in these developed countries will also increase over times to come. All right. And second on cables, we have won this Google and AWS orders.

1:09:19 So in terms of capability and capacity, are these orders going to be from the current capacity expansion, which we are doing this year? Or will there be any capacity capability addition, which is going to be required? And since the pipeline of these orders is going to further increase, so any thoughts there? We have adequate capacity currently for the orders which have been taken and then for executing this order book. Between the capacities we have now and the new equipment, which are under commissioning, we should be able to handle this. And in fact, we handle larger and larger orders is also increasing.

1:10:05 Because you see some of these AI data centers, single package coming from The U. S. Would be in between INR 400 crores and INR 1,000 crores, single package. So we are slowly gearing up the Google piece was over INR 500 crores single order. So as our credibility starts getting established on delivery of these, we'll see more and more of our participation in these sort of RFQs. And capacity is being built up. So as we speak, there's equipments under installation, commissioning, etcetera. So we are pretty much on plan, plusminus one quarter on the CapEx. Right. And there's 1,000 crore enabling in the Singapore entity. So any like clarity as to I think you have mentioned that maybe it will be equity prep for that. So are we not funding through internal accruals?

1:11:05 And second, what exactly this relates to? Any expansion, any particular division? If you could give more clarity on this. So we will reveal the details at appropriate time, probably once we implement the stock exchange first obviously, and then we would reveal the details. Currently, as I said, it's an enabling resolution to infuse that. And as in when we implement the stock exchange, then we can have more discussion on that. Understood. Lastly, on the cable business, I'll leave you to guide in terms of the growth in elastomeric e beam and B2C. So how has that shaped up in H1?

1:11:52 And second, in terms of like power cable, we were kind of trying to improve our capability and product profile to 132 kV and higher. So any sense there? That's it. Thank you. So the elastomeric side of the business is growing. The data center market in The U. S. Is predominantly elastomeric cable, where we use EPR, which is ethylene based polymers. So that part of the business is continuing to grow. On the power voltage front, currently, are at 66 kV. But some of the new equipment going in will enable us to go to 132 and finally up to even two twenty.

1:12:42 So that's in the pipeline, but I don't think you will see any business coming in, in the financial year 2027. It's really more of financial year 2028 play when that equipment gets installed and we start executing. Otherwise, 66 KB per business is, you know, we are regularly doing business up to 66 KB. Thank you. Thank you so much. Thank you. The next question is from the line of Natasha Jain from Philip Capital. Please go ahead. Just one question on the global macro side. If domestically, we see the power and transmission spend given by the government that comprises both of copper, aluminum wire cable on value terms. Copper is definitely increasing. I know we do not do a lot of wire or copper, but then the overall budget is indexed to that.

1:13:43 The geopolitical side, the macro side does not seem to be moving on the wall front. So my question to you is, has it happened historically? Can it happen that the entire P and D budget, you know, there could be a deprioritization in that spending? And what risk do you see? I mean, we all know the strong tailwinds in cable, but from a very medium term structural point of view, what is the risk that can rectify in this segment? So first of all, for us also, the copper portfolio is continuously growing, both in the cable side as well as even on the conductor side. So in that sense, copper is becoming as a physical percentage of the total metal that we process is increasing.

1:14:31 We really don't see any major impact on the T and D side at all. There's, in fact, shortage of power. We've had a horrid time when suddenly the temperature went up in the month of September. So in fact and again, there were a lot of stability issues in the grid and in the system. So as a consequence, we don't see any slowdown. We actually see, as I mentioned to you, new legislation coming in, which is going to actually grow demand. The same thing is there overseas. You see the more and more products are going in, more and more systems are coming in, HDLS is starting to go in. That whole program of Spark is looking at unlocking 23 gigawatts of power delivery on by reconducting and upgrading the technologies on existing transmission corridors.

1:15:29 I don't really see anything. There may be a little bit plusminus, but if you look at the trend, there's no indication of the trend going down. There's a lot of noise about data center spending in The U. S. It may not be 50 gigawatts in a year, but even if it is 15, 20 gigawatts in a year, it's it's really big. And the total value is also going to be very, very big. Understood, sir. So at least there is no risk that you see on deprioritization in terms of spending on Power D and D? Yes. I mean, I think that's quite remote from our standpoint. Understood. And sir, just one last question on cable, your margins have improved despite the fact that higher margin exports have significantly reduced.

1:16:18 So is it a contribution because of premium products? And is that can you please call out what was the mix last quarter versus mix this quarter from premium products? So product portfolio on cables, we have constantly been looking at the elastomeric cables, which go into all these premium segments. There's I mean, it's at the upper end of what we've seen in the last few quarters, but there's nothing unusually that major that's coming. As we continue to push for higher and higher applications and things, our target is to actually settle between 1012% in terms of EBITDA margin on a 25% year on year growth with stable metal prices.

1:17:12 So you'll continue on, I mean, we are still pushing for higher margins than what are existing today. Got it. Understood, sir. Thank you so much. Thank you. The next question is from the line of Sanjeev Varbade from Antique Institutional Equities. Please go ahead. Yeah. Hello, Sandeep. Can you... We can't hear you yet. Can you hear us? Yeah, sir. Congratulations on a good set of numbers. You. Sir, just wanted to take your... How do you read the emerging demand supply situation in the conductor side? Because smaller players are also adding capacity, while in the first half, the volumes have contracted for you also. So how do you read the the situation maybe in in the medium term?

1:18:12 Yeah. So in the situation for conductors, on the conventional conductors, there are few players who have come in, who are having their own EPC or they are already in the downstream. So in those cases, there's a certain part of the market, which is kind of now called out, which is not that accessible to us in the domestic market. And on the HTLS side or the other premium type of products, there are new entrants who have come in. But there, again, the challenge is not just on manufacturing, but also in terms of meeting the quality specs and also end to end completing the project, which requires engineering design as well as on the performance of the product and meeting the tough requirements of an HTLS product.

1:19:08 So while there may be new entrants and some market may be taken by either the new players for HTLS or some of the key PC players who have done the backward integration by making the conductors. The overall pie is growing, and we don't see that we will have a reduction in our volumes. The other thing is that Apar is always having a lot of more innovative products. So with that, we always will be a leader in the marketplace, and we'll be able to drive these innovative solutions, and we'll be able to maintain our volume and leadership as well as maintain our profits. So for example, I mentioned specifically that we got our first Z type conductor order from a large Scandinavian utility that's evacuating power from an offshore windmill.

1:19:59 Now those sort of products over a period of time will also find its way to India. The East Coast Of India has a cyclone. There's another cyclone building up as we speak in the next few weeks. So these type of products are ideal. The Z type conductor allows the flow through of air to take place within the conductor itself. It flows right through it. So as a consequence, it doesn't move as much as would move with a conventional product. So there'll be more and more players coming in, but that's fine. They are trying to premiumize their portfolio, but we are trying to further premiumize our portfolio with these sort of solution based products. So I don't think we are like really worried about competition and stuff in that Yes, sir. Thanks. And We'll find we'll find, you know, the green grass either in locality a, b, or c.

1:20:59 Thank you, sir, and all the best. Yeah. Thank you. Thank you. Thank you. The next question is from the line of Mahesh Patel from ICICI Securities. Please go ahead. Yeah. Hi, sir. Thanks for the opportunity. So my question is on the the DC thing, right, data centers. Out of the current order book, how much would be pertaining to these data centers? So we have about a 1,000 out of the 3,000 approximately. They are from the two large ones. There may be a few 100 crores more from other data centers.

1:21:45 But it's a constant flow. I mean, specifically mentioned these two because the order which we got from a contractor that is flowing into a Google data center in the Midwest and The U. S. Is the largest single order that we've got from The U. S, it's over INR 500 crores. And it will be fully executed by around the value time. In the case of Amazon, it's the largest Amazon award, which is there. So that but the orders are being issued piece by piece depending on the availability of the infrastructure on the ground. We expect all of that also to be done by March. So these are two very large ones. There'll still be a couple 100 more coming in from smaller data centers right now in the order book, and there's a big pipeline of discussions going on.

1:22:43 Okay. And sir, in Q2, I think we have recognized some The U. S. Tariff refunds, right, around, I think, $430,000,000. So is is that it or are we expecting some more in the No, no. So we've kind of closed the book on that. Most of the refunds have come in prior to September 30. There's a little bit that's coming in post that. The bulk of these refunds have actually been passed on to clients based on the contractual obligations that were there. Whatever we are recognizing today is because we have taken the hit previously and it's getting reversed in today's situation. So it's more like a one off thing against those supplies.

1:23:33 We won't see anything recurring coming from that. Okay, sir. Got it. And sir, lastly, see on the premium side, right, in conductors, I think we do not consider AL-fifty nine, right, as a industry premium is that we give. So can we get the AL59 mix or let's say premium plus AL59 mix, what would be the share? We generally share consistently the premium and non premium, so that is consistent across the quarter. So AL 59 is we don't track that separately in the premium bucket. But there's been some amount of toggling going on between AL 59 and standard ACSR because simply when the war broke out, the price of aluminum shut up, but steel hadn't reacted.

1:24:25 But now steel has reacted. So again, AL-fifty nine is a much better option than your conventional APARIN. So there's a little bit of a flip flop that's been happening depending on the relative price of aluminum versus steel. But we don't keep we just consider that in the bucket of conventional products. And the premium that was there on AL-fifty nine is no longer that huge of premium. What has significantly happened is that the number of players who can produce AL-fifty nine versus ATSR is a fraction. And as time will tell, a lot of the newcomers producing AL-fifty nine are actually not able to produce the right quality of product, which may result in higher line losses and things like that.

1:25:17 So whereas we have a very established AL-fifty nine technology, we've been making this for decades. So we don't track it separately, but I think that AL 59 story will still remain in terms of it being significantly better than just having APARINDS, you know, all these sort of products. Got it, sir. Yeah. Yeah. Thank you. Thank you, and all the best. Operator, I think that's the last question I think we have.

1:26:11 I think that's the last question we have. So we'll close the call for now. Hello? Just some closing comments, but is the line done? Yes. I'd like to close by first just wishing everybody for a festive season. And as I signed off last in terms of my opening comments that we see that the business trends remain strong. And even though there may have been some volume degrowth, two things. One is we expect the second half on the conductors volume to be stronger than the first half.

1:27:00 There is this unusually high amount of conductors and cables that are in transit currently to The U. S. On a DDP basis. So actually, our manufacturing data and dispatch data looks very different than the sales realized data. That should catch up pretty much in Q3. And considering the strong order books which we have, I think the rest of FY 'twenty seven and FY 'twenty eight looks quite bullish. So with that, I'd like to close my remarks. Thank you, everyone, for attending our call. On behalf of Apar Industries Limited, that concludes this conference call. Thank you for joining us. You may now disconnect your lines.