Kiri Industries (NSE:KIRIINDUS) Q1 2027 Earnings Call

0:01 Ladies and gentlemen, good day, and welcome to the Kiri Industries Limited Q1 FY twenty twenty seven Earnings Conference Call hosted by Valorum Advisors. As a reminder, all participant lines will be in a listen only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Please note that this conference is being recorded. I now hand the conference over to Ms. From Valorum Advisors. Thank you, and over to you, ma'am. Thank you. Good morning, everyone, and a very warm welcome to you all. My name is Purangy Puranggi Jain from Mallorum Advisors. We represent the Investor Relations of Kiri Industries Limited.

0:49 On behalf of the company, would like to thank you all for participating in the company's earnings conference call for the first quarter of the financial year twenty twenty seven. Before we begin, I would like to mention a short cautionary statement. Some of the statements made in today's earnings call may be forward looking in nature. Such forward looking statements are subject to risks and uncertainties, which could cause actual results to differ from those anticipated. Such statements are based on management's belief as well as assumptions made by and information currently available to the management. Audiences are cautioned not to place any undue reliance on these forward looking statements in making any investment decisions. The purpose of today's earnings conference call is purely to educate and bring awareness about the company's fundamental business and financial quarter under review.

1:36 I would now like to introduce you to the management participating with us in the conference call. We have with us Mr. Manish Kiri, Chairman and Managing Director Mr. Jaish Hirani, Vice President, Account and Finance Mr. Suresh Kundalaya, Company Secretary and Mr. Ranjit Singh Cho, CEO, Indo Asia Copper Limited. I would now request Mr. Manish Kiri to give his opening remarks. Thank you, and over to you, sir. Good morning, everyone, and welcome to the earnings conference call for the first quarter of financial year twenty twenty seven. I hope you are all keeping safe and well. Let me begin with an update on our integrated copper and fertilizer project first, which continues to remain at the core of our long term growth strategy.

2:29 In the quarter, the project progressed from the design stage into a structured construction phase, supported by time deployment of capital from the group's strengthened financial position. Orders have been placed for several long lead mechanical, electrical and utility packages for the project with finalization of remaining major packages in advanced stage. In parallel, key enabling infrastructure continue to advance captive jetty deserination facility, dedicated raw material conveying system and projects long term power infrastructure. The downstream of copper facilities are planned to be commissioned in phases with the copper tube targeted by quarter one FY 'twenty eight, followed by copper rod plant FY 'twenty eight and copper refinery in quarter three FY 'twenty nine.

3:29 We are also progressing on our engagement with the international mining companies and global trading houses to establish long term sourcing arrangements for the copper concentrate and rock phosphate, the key raw materials for the project, while continuing to evaluate opportunities across our downstream value added product portfolio. Overall, the integrated complex remains aligned with our long term strategic road map, and our focus remains on disciplined execution and timely achievement of the next project milestones. With that update on our new platform, let me now turn to the performance of our existing dyes, dyes intermediates and basic chemical business.

4:17 So, requirement for dyes, dyes intermediate industry in the first quarter FY 'twenty seven, I think active items in our cell phones, adjusted and certain basic chemicals strengthened during the quarter, supported by tighter global supply, higher and continuing impact of environmental on manufacturing facilities in China. Demand trends, however, remained mixed across product categories, while input cost pressures persisted. Our major raw materials grew by oil prices, which increased during the quarter, resulting in higher input and operating costs.

5:07 However, improved average selling realization across portfolio, together with effect of higher real growth, supported and helps us in profitability. We continue to see improving business, price related to chemicals operation. The improvement is realization driver of revenue in the quarter, while customer base continued to support the business. During the quarter, NPL margin 31.9% compared to 23.5% FY 2026.

6:06 I'm sorry to interrupt, sir. Could you repeat your last question? During the quarter, our margin improved to INR31.9 $20.26. The improvement was primarily driven by favorable pricing differentials with average selling prices rising faster than average raw material prices. We remain focused on maintaining pricing operation.

7:03 Sorry to interrupt, sir. We are unable to hear you. Not able to hear? Yes, sir. It better now? Disturbance. Disturbance, sir. I think there is a disturbance on the line. Disturbance. Yeah. Online. Yes. There's continuous disturbance on the line here. Here. Is it better now? Are you able to hear me? Sir, can you come more closer to the mic? Now? No, sir. Let me just reconnect you.

7:51 I think you have to reconnect. I think you have to reconnect. There is some problem in the line. You can... I hear lot of noise. Ladies and gentlemen, the lines of the management

10:14 has been reconnected. Yes, sir. Please proceed. Sorry for the disturbance. Now coming to the financial performance for the quarter. On a stand alone basis, revenue from operations for quarter one FY 'twenty seven stood at $2.95 crores, registering a growth of 63% year on year. The growth was primarily realization led, supported by improved average selling realizations across dyes, dyes intermediates and basic chemicals. Stand alone EBITDA stood at INR 17 crore with an EBITDA margin of 5.86%. Further, other incomes earned during the quarter amounted to INR $2.84 crores, which mainly included earnings from the treasury management, hence the profit after tax stood at INR $2.70 crores.

11:14 On a consolidated basis, revenue from operations from quarter one FY twenty twenty seven stood at INR312 crores, registering a growth of 55% year on year. The growth was led principally by improved price realizations across the product portfolio rather than by volume. Consolidated EBITDA, including share of profit of associates and joint venture stood at INR37 crores, with an EBITDA margin of 7.84%, with profit after tax stood at INR270 crores. The significant increase in profit after tax during the quarter was primarily driven by strong contribution from other income.

12:02 Other income stood at $2.86 crores, primarily comprising interest income on intercorporate loans and realized and unrealized gains on treasury transactions undertaken by the company. This was further supported by improvement in the underlying operating performance, driven by better realizations and better margins. Finance costs reduced sharply following the repayment of borrowings at Claronex Holding Private Limited, leaving the group substantially free of external debt. The share of profit from associates for quarter one FY twenty twenty seven stood at INR 21 crores, representing a 30% increase over the preceding quarter.

12:51 The contribution was primarily from Longshan Kiri, in which the company holds 40% equity interest and management control. Looking ahead, medium to long term outlook for our dyes, dyes intermediate and basic chemical business remains positive, supported by steady textile demand, tighter global availability and sourcing trends for favoring non China supplies. As one of the largest global producers of H acid, we believe our existing capacity provides headroom to participate in rising demand without significant additional CapEx expenditure. Sustaining margins, however, will remain dependent on our ability to pass through input cost movements.

13:41 The fertilizer opportunity is also supported by India's continued dependence on imports, particularly in DAP and key intermediates such as phosphoric acid and ammonia. Against this backdrop, the phased commissioning of our integrated complex is aligned with the widening supply gap of both refined copper and phosphatic fertilizers. Our focus remains on sustaining the improvement in our existing chemical business, maintaining a prudent capital structure and executing the copper and fertilizer projects in a disciplined and timely manner as we build the next phase of growth for Kiri Industries Limited. With that, we can now begin the question and answer session. Thank you.

14:32 Thank you, sir. We will now begin the question and answer session. Our first question comes from the line of Suresh with Varam Financial. Please go ahead. I'm Tresh from management. Yes, yes, please.

15:27 Sir, imagine if you are also a partner of shareholders in a firm and you did not receive any capital returns or dividend returns even after ten years investment. As a fellow partner, as a shareholder, please think about this scenario and make a decision. Please don't take this wrong way. And ultimately, what a shareholder truly wants and deserves is a return on investment. You try to give me dividends, take my position and request. Don't think wrong way. Please try to understand. Yes. Steve, a few points to address your question and very well put forward.

16:14 Number one, we as you have seen, we have reported the one of the strongest quarter in the history of the company in terms of performance. So the performance is what the company is saying and we promise to you. And the performance has, I think, matched or met with the expectations in terms of our growing requirements of capital. Now number two, with that, as you have already seen that the company has embarked on executing one of the largest greenfield project in the history of the company. And looking at requirements of the capital going forward, looking at the new growth trajectory, which we have already highlighted earlier and executing right now, the Board of the company and we all decided to keep the capital to fuel this growth.

17:15 So whatever company has been waiting on achieving certain performance due to the legal and litigation problem that we faced for a period of eleven years. Now having that behind us, the growth part has started and first quarter has shown that growth and we will continue to improve the performance of the company. So my humble request to you is to look at how the performance is changing, how we are building new businesses and how the capital is prudently deployed on in the growth of the company. So that's what we would like to focus on. Actually, I am asking... So just answer the dividend is not being declared, and there is no decision of the Board to declare any dividend yet. If that changes in the coming quarters, we'll be very pleased to inform the shareholders and to you. Actually, okay, sir. Okay. You invest in growth side in new projects.

18:26 But in long battle, right, for investors also in the case. You are winning the case, at least you invest a major amount in expansion, but little bit amount will give the dividend. Shareholders are also happy investors and the stock price will not give the dividend. So many investors in the money control rumors, some you don't think otherwise. Some rumors in is the management is not conservative. That is wrong. But you will give a little bit dividend, almost investors are also happy. Just you think you will have to take Yes, Board of Directors' yes. And we have taken your point, your individual point positively.

19:17 We company is not making its decision based on the rumors or cannot make a deal with rumors. There are equal number of shareholders who have also contacted a company and informed company that they are aligned with the company's decision to grow the capital, to grow the return and to grow the equity return for the shareholders in coming years, utilizing the funds prudently and properly, correct? So there are equal number of shareholders who are deferring the views presented by your individual view, but we take your inputs positively and we see how we are able to decide in the best interest of the company and its shareholders, the larger pool of shareholders.

20:10 We have a day, sir. You take feedback and you submit their Board of Directors meeting. We have good day, Thank you. Mr. Suresh, I would request you to please come back in the queue for further questions. Thank you. The next question comes from the line of Veer Jain with Mahavir Fabric Family Office. Please go ahead. Morning, Mr. Manish. I'd to know if there is any update regarding the financial closure.

21:02 And secondly, I also want to know the exact scope of Tata Consulting engineers in the project because when I was surfing their website, I couldn't find our project listed in their list of projects. So, like, I want to know what they are exactly doing as the project managers in our project. Thank you. So your second question first, PCE has been deployed as an owners engineers of the company since the end of last year they are involved in project management and control. They are overseeing all the technology transfer in terms of the checking and approving the drawings, the designs and they are involved deeply in the detail engineering as well.

21:56 So there is a larger scope of TC and TC has been on board since the end of November from November 2000 from 2020 So five, that's number one. Number two, financial closure a complete financial closure has not been achieved yet. We are there on the debt raising. More than 50% commitments have been received. Rest is in process. And we hope that in the next few months, we should be able to reach the complete financial closure. Thank you. Thank you. Got it. Thank you. Next question comes from the line of Ashish Khosari, an individual investor. Please go ahead.

22:49 Thank you, sir. Thank you, Manish Bhai. Thank you, Ashish Bhai. I would just wish you a happy Independence Day in advance. And I would want to understand how our copper project is progressing and what is going to be our capital requirement and by what time we will be cash surplus from the projects? Well, happy Independence Day to you as well. And the capital is continuously being deployed in the project. And the total capital requirement as per the current estimate would be around close to INR 12,000 crores on the project itself.

23:38 And additional requirements would be related to the infrastructure, the supporting infrastructure that we have been building. So that is the outflow in Phase one. This outflow is continue to happen over a period of next two years, not immediate. So monthly on quarterly basis as we have disclosed, the CapEx has increasing and the funds have been deployed in CapEx. So that's one area. Twenty twenty seven part of the facilities will be operational mainly related to the downstream products of copper, consumer products of copper. And then 2028, beginning of twenty twenty nine, the full facilities would become operational.

24:24 I am Ranjit Singh Chung, CEO for Indonesia Copper and fertilizer together. At the present, we are focusing on the downstream products so that the capital which has been employed from our own starts giving some returns. So in that regard, a 35 Kt plant of tube plant will be operational in June 27. And in August, September 27, 2.25 lakh tonnes of CTR container rod plant of eight millimeters will be operational. These will be operated from imported cathodes primarily coming from Japan, because the cathodes which come from Japan do not come on premium.

25:20 They are pure aluminum grade cathodes costing wise. Then and if you look into any such kind of plant startup, it does take some time to stabilize. So by January 28, the whole complete these two plants will be stable, fully operational stable and running in nice thing. So by that time, we'll make our part refinery operational, which will turn out anodes to cathode, LME grade cathode, which is part when we say part refining, it will be 1.75 lakh tonnes. To complement that, we will be utilizing scrap from various sources, whether in gold, etch, plister, etcetera, use our melting scrap melting permits, which also will be commissioned by December, January 26, 2728.

26:17 So by January 28, we will have scrap plant started for operation and which will produce anodes and that anode will get converted to LME grade carbonate refinery. So this first portion of the downstream will be fully operational. Whatever will be the shortfall of cathode requirement that will anyway procure from the market. At the same time, we envisage to start another value added product in the same period, exactly same period are, let's say, Basmati, a small quantity, but they'll add value to the our value addition will be there plus cost balls, cost copper balls. So these two will be operational at the same time.

27:04 Then the next phase of journey will start. In between, we will be in a position to start copper foil business of minimum 5,000 ks as first round of trial product, which is highly value added product, meaning that today, if you look in India, the copper coil is imported with LME grade copper plus 5,000 additional premium. Of course, there will be, I mean, OpEx to it, but irrespective of that OpEx, this is a very valuable product. We will be starting that with trial orders I mean, trial production for 5,000 Kt, where the complete system will be built for 10 Kt, which we call Phase one.

27:55 Our aim is to be Phase one, two and three to make it 40 Kt, for which we have already gone to central government to be part of e... ECMS. ECMS scheme. So this also will be operational in, I mean, I'm looking at eighteen to twenty months from now. So if you look at 03/21/2028, these are value added products. Balance of the plant, which is primarily the smelter sulphate, the sulphuric acid plant and fertilizers will be operational in first quarter of 'twenty nine. So these are the typical time lines as of now we have put ourselves into our sector, the targets based upon this, which in any such is I think for six months faster.

28:54 People take a medium thirty six to forty months, if we whichever way we count, it will be around six months five to six months every year. Have we tied up with raw material requirement for next couple of years? Is it a long term Normally, contract fixed Normally, what happens in copper concentrate business, what we call as long term contracts are typically done for two to three years on an average. Last year, for copper, there are two big conferences happen across the world. One is London, which happens typically in October and another is Cisco in Chile. So we have participated in both of them, and we have been discussing and doing lot of rounds with the miners and the trader stakeholders.

29:52 So today, as we speak, we have got a firm window of approximately 1,000,000 tonne of copper concentrate. I mean, it's only window we get. We get an what we call MOUs basically. And the MOUs get firm three to four months prior to our requirement. In our case, we'll come up in terms of costing, contract costing, bonded contracts in October 28. That is the time in that LME year, this contract actually converted into, let's say, contract, MOUs are turned into contract. So as we speak today, we are having MOUs of 1,000,000 tonne of copper concentrate.

30:38 And if we go for over 100% production, we'll be requiring around 1,500,000 or NOK 1 point lakh. So yes, this is the journey of only one year. Last year, when this year again, when we go to October, I think so the visibility will go up from today 1,000,000 to 1,200,000 to 1,400,000. So we are pretty confident because last year we did not have much to showcase. This year, I think so excite like now today, 1,000 people are working, steel and mechanical, and things have come overground for tube and rod plant. So obviously, the things as things have changed physically at site, so will be the thought process of the people who supply the copper concentrate or raw material to us. So this is what is the issue done.

31:43 The next question comes from the line of Mehul Panjwani with $0.40 Please go ahead. Hello. Thank you much for the opportunity. Am I audible? Yes. Yes, please. Sir, when did we record the first revenue from the copper business in which quarter of FY 2027? I think, Chuk Saab just mentioned it would be somewhere around first quarter, end of first quarter, May June twenty twenty seven. So that would be 2728 financial year first quarter. Q2, will get commercial.

32:29 Yes. So quarter one, quarter two, you are looking for next financial year. Okay. And sir, when will the complete overall total top line which we are expecting from the copper, when will that be targeted and what time line we are expecting to achieve it? Financial year twenty twenty nine-thirty. Twenty nine-thirty. That is Q4? Yes, that financial year is the one which will capture majority of the operational revenues. Right. And sir, how are we placed to service the debt which we have taken for this project?

33:19 So just addressed by Chuksa, twenty twenty seven-twenty twenty eight is a financial year where the cash flow will start coming and building. So from twenty twenty seven-twenty twenty eight, twenty twenty eight-twenty twenty nine and twenty twenty nine-thirty all three years company will start moderately ramping up the cash flow from the stepwise operations that will start. So there will be parallel cash flow coming as well. Right, sir. Sir, where the site Yeah. Yeah. Thank you, sir. Thanks. Sir, where is the site for the Copperaji? Are there multiple locations or it's a one site? One one location near.

34:08 Okay. South India. Thank you so much, sir. You so much sir and wish you the very best. Thank Thank you. The next question comes from the line of Manoj Kumar with Adinat Financial Services. Please go ahead. Good morning, Manishwai. Manojji, always welcome. Good morning to you. Yes. My question was regarding our current business of dyes and chemicals. We have got almost 13, 14 major products in our product line and with huge capacities. And most of the capacity is remaining unutilized, I think. Around 40% we are using, 60% is still unutilized.

34:57 Right, sir? So the last quarter, we utilized average capacity about 60%. 60%. And yes, we still have 40% unutilized in various plants combined together. Yes. What can be our ideal situation with 100% capacity utilization? How much can be the turnover and how much can be the profit we can generate? Because around 31% margin, the margin is there in material margin is there. Right, right. So now the market has improved. We have seen the prices have also increased. And we started slowly ramping up the capacities provided demand support that, correct? And we do not want to compromise the margins on account of just building volume.

35:49 So it's cautious approach where we are ramping up, but ramping up profitability, if you profitably. If you look at the consolidated EBITDA of the quarter, probably with now legal costs behind as well as the improvements in the industry situation, we got INR 37 crore of including the JV's operations. So that's a good number, if you ask me, and that is where we would continue to build upon that. So if the market supports, then from 60% to 70%, 75%, at least we want to achieve during this year as an average capacity utilization, Manojeet.

36:41 These two products which you were referring to HSE and Vinyl sulphur, we have got good capacity around 7,200 metric ton for the HSE and around 12,000, 13,000, 15,000, I think, for that. And as the prevailing prices, I was just calculating, the annual turnover from these two products only will be INR 800 crores to INR 1,000 crore. Yes, yes. True, true. If the SG and what about other products, can we achieve a turnover of around INR 2,000 crore from our Dive business? If we are able to achieve close to 75% to 80% capacity utilization and if we are able to sustain the prices which are there currently because today, adjusted prices is in the range of 800 to INR 900, which used to be INR 400, INR $3.50 earlier, correct? So you are looking at the double the pricing than the average pricing earlier.

37:49 Similar situation with vinyl sulfone also. The prices are almost 70%, 80% high. No doubt, the raw materials have also increased substantially. But if these prices continue for the next one year, then yes, we can have much higher revenue and the numbers could be even double than the average. That means if you are looking at INR 1,200 crore of revenue, it will just on the price increase and the capacity utilization improvement, it could touch close to INR 2,000 crore, yes. But why our profitability is so low? Because our own subsidiary, Wamsan Kiri is having a fantastic result, fantastic EBITDA margin and fantastic PAT margin also.

38:39 Only around INR $3.68 crores, they have earned around INR 71 crore EBITDA and INR 51 crore passed. What prevents us from repeating both figures in Kiri? So there are different products in JV and different products in Kiri, right? Kiri is selling raw materials to JV, and JV captures the finished products margin. So when you look at and compare the supplies of raw materials from Kiri to JV, the markup and the value added profits and the margins are captured at the JV level on the finished products. So when you look at the totality of the picture, then you capture the entire value chain margin.

39:30 So to see the entire value chain margin, you have to look at combined operations of Kiri and JV. That's one. Number two, there are certain chemistries, certain product ranges, which are prevalent in and which are set up in JV are not in Kiri. So there are even though dies are produced at both the ends, the products are different as well. More than 50% of the products are different. For example, JV produces Indigo, while Kiri doesn't do it, right? Similarly, JV has certain advanced chemistry, which stand alone Kiri doesn't do it, right? So there are different products and value added on the finished product. These are the two differentiating factors. So when you look at the total picture, that gives you the correct picture.

40:26 We are having 40% stake in loans in Kiri, whereas in Kiri, we have all the money with us. Can't you replicate those things in Kiri? And those products in Kiri? Is there exclusivity some clause or is there? I think based on the agreements between Kiri and Longshan Kiri also, which are existing. And even though Longshan Kiri continues to have JV operations, its operated run management by Kiri even today itself, correct? There is no point in creating inter company competition by replicating what they do to Kiri and destroy the margins in the market. So strategically, even though Kiri may consolidate 40% of loans in Kiri, the higher we stand on long term Kiri, the better beneficiary Kiri is. And 60%, 70% of JV's raw materials anyway go from Kiri. So there are very close linkages between two companies in terms of raw material supply at a very high volume and also value added 40%.

41:42 And that has been structured since the beginning, and there is no disturbance in that. And if you look at the overall supply chain globally, and JV continues still to be, even after exit from DaiStar, the largest single supplier to DaiStar as well, even though we have exited from DaiStar. So from operational point of view, from strategic supply chain point of view, I think it is well established, and we don't see any reason to deviate from whatever is working. Thank you, sir. Thank you very much. Thank you. Thank you, Manaji. Thank you. The next question comes from the line of Anirup Rayar, an individual investor. Please go ahead.

42:33 Congratulations on the result. The only other question I had was, maybe this is a repeat or I missed this on Sukhtar's commentary. So given the tube and rod plants are commissioning a quarter apart, does the previously guided INR 20,000 crores to 25,000 crores FY 'twenty eight revenue still hold? And the second part of that question was what is the basis of making the projection? Do we already have an established sales channel, a customer base, etcetera? Number one, that number is dynamically moving number. So that 20,025 thousand dollars of revenue in 'twenty seven, 'twenty eight doesn't hold. Let me first clarify that. And a lot of installation and delivery of the machinery depends on the vendors' time lines, and that also keeps moving.

43:29 And that is precisely the reason that every quarter, we keep updated on the progress, and that is how we will also keep informing you and when the revenue projections becomes clearer and clearer. So that's one. On the other side, the clientele base, which you referred to, today, as a country, we are highly import dependent. So whatever we sell would be all import replacement. And to the extent if we look at the market survey and the numbers that are prevailing for the last year, consumption of copper in India at 1,800,000 tonne, almost twothree of that requirement has met by imports, correct?

44:26 So when we are talking about selling the entire output of the facility only to substitute import, sales is not a challenge. And now but of course, we need to have the quality approved. We need to go through the approval process from the customers. But selling is not a challenge. Selling is basically having the established current channels to be filled up with domestic production, replacing the import, which is happening today. So that's not a challenge. As long as we are able to produce and as long as we are able to secure the raw materials, we don't see sales is in constraint to generate travel.

45:24 Sir. Sir, just one question is, I just want to understand what is the role of the marine jetty? Because if I'm not mistaken, our plant is slightly inland, still close to the port. So I just want to understand what is the role of the marine jetty? So near the port, a separate jetty, dedicated jetty, we realize is very important because of our bulk imports and continuous imports of products like copper concentrate, phosphates, ammonia and bulk handling at the port is currently a challenge because it's mainly a containerized, container port and containerized cargo is being handled there. So we are almost near the port, not too far away, but separate jetty provides us in terms of operational cost optimization and plus the dedicated unloading of the bulk vessels that we will be getting.

46:23 So from logistics point of view, from operational point of view as well as long term operational cost point of view, it necessary to have this kind of infrastructure to support the project. Understood, sir. That gives a lot of clarity. Thank you so much. Those are my questions. Thank you. The next question comes from the line of Kaushal Kedya with Wolffort Investment. Please go ahead. Sir, thank you for my question. Sir, just wanted to know what is the update on the MCB copper gold project, where we sort of acquired the mine? Right. So we are already now a part of MCB copper gold project.

47:15 And the development of that mine is has not started yet. The design has already been completed. Currently, if you look at various announcements in the public domain, there has been a shareholder disagreements on certain areas, which are currently being addressed. And good part is that there are many financing offers received by the project, And we got regular updates from the project as well that the development of the project and the participations in the development for financing the project is also quite positive. So we hope that before the end of the year, we get a good news of projects completing their financial closure and start the development of the project. But it's quite positive, and they are on it.

48:17 We are not actively involved in terms of the management or operations there. We are more of a passive player in terms of providing our inputs there, but we continue to monitor and watch the development. So right now, what do what should we assume that will we get access to the offtake out there? Is it a higher No, no. We have already structured 70% of the offtake to come to us. That was the key. No. But okay. So there's no chance of the thing not coming to us, right? Because I think Celsius is still sort of litigating.

49:06 So... Yes. There are yes, there are several disputes and litigations ongoing right now. And Celsius is objecting it is offtake. But I think based on the overall assessment of the situation and looking at sales continuous attack on the other shareholders there, It seems that the matter has been now put to the court, and we should have some clarity on that as well. But as far as the majority shareholders are concerned and our earlier are concerned, which is which still hold and we are hopeful that Celsius, who is trying to derail the development of the project, doesn't put kind of barriers to stop the development. So let's focus. It is still the matter is still sort of in process. We don't have like access to the 40% or 60%.

50:16 Like what is the worst case scenario? Because this is very important. This is in place when we have access to copper concentrate, which is everyone's doubt. What is like if you're comfortable to answer that, sir, right, at this juncture? As you know, the matter is subjudiced, right? And because the matter is subjudiced and Celsius is in the port, we would not comment something that the port is looking into because it would be rather speculation from our side, correct? And as you are aware, once the court decides on the matters involved, then we will have more clarity, correct?

51:03 I would not speculate something before the judiciary makes the decision on the shareholder situation first, correct? And let that be sorted out, and Kiri continues to remain a lender. The position of Kiri is still a lender today, correct? And we continue to remain lender, right, these things are sorted out so that we can if our money needs to be returned, it's to be returned, if the benefit is not secured, right? Let me that's the way we are looking at it. So we are sure that if the development of the but we continue to provide our commitment to the project. We continue to support the project.

51:51 And we continue to make sure that whatever is needs to be done on ground to support the project to develop the mine, we are fully supporting. While Celsius has not been supporting to the as a shareholder, what they should be doing. So actually, we are fulfilling the mine's commitment, and we hope that is being looked at positively by the stakeholders as well as by the quarter. The next question comes from the line of Vivek Joshi, an individual investor. Congratulations on a good set of numbers.

52:40 I just want to get some more idea on the copper project. We had requested earlier also that if you can give us the update as to the capital employed and stuff on the copper side, it would be very useful. Can you give us an update as to how much capital is there and how much is equity and how much is debt among the current balance sheet? You mean on the total project or currently, it is all equity in Q1? As balance on sheet, how much of in the copper project, how much of the capital is allocated to the copper project? From the today yes, today, the total capital deployed in the project is INR 1,400 crores, right, till now. That all is equity? Or is it like half equity, half... No, no, that's all equity right now.

53:27 Okay. Yes. So on the balance sheet, you still have some loans. So whom are we lending money now? We still have loans? You mean the borrowings? No, no. We have like given loans to people. Like... These are all part of the treasury activities that we do. Some of the loans yes, and some of the loans are intercompany The next question comes from the line of Swaroop B. B, an individual investor. Sir, just a follow-up question on earlier question here. The thing is you are saying that all the margins have been passed on to Loncin Kiri. But what's actually have you considered tax impact, sir? So what happens is now since you're passing on a margin to launch there, are suppose they are earning INR 125 percent is paid as tax, then later on 70 yes, no, launch increase no, assume their turnover would be INR 100 EBITDA would be INR 100.

54:36 Then later on, they pay some tax. Then net net profit of Laurentian Kiri will be INR 75 crores. Then later on, Laurentian Kiri declares dividend and that INR 75 crores we receive. Then again, later on, Kiri again pays 25% tax on this other income. And don't you think there will be a 40% tax effectively, sir, on whatever debt that we are? If you look at the transactions between the companies, it's all arms length transaction, number one. And we have to be conducting arms length transaction complying the law, correct? So whatever raw materials are supplied from Kiri to JV, those are again on transaction and then whatever earnings that happen at the JV, that happens at JV. If you look at the last I mean the quarter's number, INR 16 crore is the EBITDA generated by Kiri and INR 21 crore is 40% of Kiri's EBITDA generated at JV, right?

55:45 So and so whatever are the profits are the profit. They are part wherever these profits are generated, right? So if they are generated at JV level, they are at the JV level. If they are generated at Kiri level, they are at the Kiri level, correct? We and then whatever tax applicable at each level, we pay that tax. That's how we should be working, correct? So is there any update on stake sales, sir, regarding 41 stakes there? There were talks earlier. No, there is no talk. There is no such discussion, sir. Understood. Sir, my second question is with respect to like earlier, you had guided INR 1,200 crore EBITDA for FY 'twenty seven-'twenty eight.

56:32 Basically, sir, if sir, on what basis is the assumption made, sir? For example, in 'twenty seven, 'twenty eight, if we process one rods and tubes, hardly have a EBITDA margin of 15,000 to 20,000 per tonne. Even if we process one lakh tonne, our EBITDA would be hardly INR 200 crores to INR $2.50 crores. But what you are projecting is close to INR 1,000 crores, INR 200 crores. On what basis is this projection made, sir? Such a huge gap variation. On what basis is this made, sir? Right. So if you do a simple math, right, it all depends on when the facilities become operational. And there is no hard line here. And I just mentioned earlier as well, the projections are changing. They will keep changing based on the time lines to make the facilities operational, correct.

57:22 So as I referred earlier, these numbers will change. And this number are not the number which are numbers on the existing established commercial operations, correct? So we are projecting something where there is a moving target on starting and establishing commercial operations. So you need to take that variation into consideration, number one. Number two, even if you do one lakh tonne in today's prices, right, that comes to INR 15,000 crore of revenue just from one lakh tonne, correct? Correct. And if you make 6% on it, right, No, Then also no, it no, percent how will 6% be made, sir? When you are purchasing cathode from outside now, sir, how can 6% be captured on only stand alone rod and tube lines? I think you should study what are the price structures for the products such as copper, tubes, rods, wires, right?

58:37 Correct? How these price ranges exist in the market? What LME markup each of the downstream products is prevailing in the market. When you look at the consolidated effect on the prices prevailing on LME plus operations in the downstream products, you will see these kind of numbers. Perfect. But last question, sir. With respect to MMCI, would we be still interested in being a PDP partner? Or would we be attaining some stake in MMCI mines, We would. We would definitely be interested, 100% interested. It depends on how this overall situation resolve from the litigation perspective.

59:30 Sure. Thank you. Thanks a lot. Thank you. The next question comes from the line of Rajat Malakar with Asika Stock Services. Please go ahead. Sir, I have two questions. The first question is that for your copper business, which companies, mining companies you have tied up for your long term sourcing? Well, there are leading miners and traders. They are global companies. We would not be mentioning everyone's name here because there are confidentiality involved in the agreement But they are the leading providers of the sources of copper with whom we have done.

1:00:24 Okay. Got it. My second question is that, sir, you have told that maximum revenue from the copper business will be achieved in FY 'thirty. So when your debt repayment process will start? Based on the because today, the company has not done any drawdown on the debt, right? Considering the moratorium, which has been allowed, the debt repayment will start somewhere in 2029, not before that. Okay. Got it, Thank you. That's all from me. Thank you. The next question comes from the line of Manoj Kumar from Adidas Financial Services. Please go ahead.

1:01:17 My question my suggestion was, why don't we structure into Asia fund requirement for equity? Because market is very good and our financial strength is very good. So that we don't have to take any loan whatsoever. Then the return on equity will reduce Last announcement was made from Indonesia at the rate of two seventy eight, then we can command a very good premium in the market.

1:02:04 If you say, if we issue share at around INR $507,100, depending on the market demand, we can have enough money to fund our business. You are right. That's definitely an option there. That's definitely an option. Yes. Are not at all burdened with any loan repayment, term loan, whatever it is, we are free from all those answers. Right. See, the look at the numbers, and I agree with you from the angles that you have just mentioned. And it would actually it would help the management also to have lesser stress, isn't it, on the debt And recently, we have taken an equity infusion in Indonesia also from one roundabout $232 we have got. That's what I would like to say. Why don't we take all those persons who are interested to invest?

1:03:01 Right. We can have have that stake as more than 50% reducing and diluting balance for financing of the project. So here is the answer to you. So we definitely have that option, and we have tested water, as you rightly said. So we have tested water means there is an interest. And that option still remain a valid option. The trade off happens here in a sense that if we are able to successfully execute the project without diluting today, right, and generating profit building numbers and then dilute, right, there is a huge delta upside for the shareholders of Kiri, correct?

1:03:53 That means that the value creation by deferred dilution post execution of the project, right, would be much, much higher. So that value capturing for Kiri shareholders would provide more benefit to the shareholders. And with that in mind, to look at the larger interest of the shareholders' value creation, we are putting the capital structure what has been decided today. But again, as you have said, there is always an option to do that and complete the financial requirements if we need. And there is enough interest for that. We have tested, we have invited and we have seen the real infusion. So that is there. That is That is the plan B, but we see how we can progress from here. Yes. Regarding our one interview, the MD of EPICOL had stated that Kiri is taking participating in some agrochemical complex near Damra Port.

1:05:10 What is the status of that? There has been discussion on certain chemical projects, the large one, which we would not embark on right now till we make the existing projects operational, but it's part of our long term vision. And any approvals also take time. So there are certain chemicals, specialty chemicals that we have looked at. Again, those are part of the import substitute and import replacement requirements for the country. And but it's quite far currently. So it's all preliminary stage and where we have serious interest to develop a large chemical complex somewhere near port there.

1:06:00 And government has given us quite a good support in terms of incentives as well as in terms of the requirements which such project might attract to. So we continue to explore these opportunities, but execution will be sequentially and not Thank you, sir. Ladies and gentlemen, that was the last question for today. I now hand the conference over to the management for their closing comments. Thank you all for participating in this earnings conference call. I hope we are able to answer your questions satisfactorily and at the same time, offer insights into our business.

1:06:48 If you have any further questions or would like to know more about the company, please reach out to our Investor Relations Managers at Valenum Advisors. Thank you and wishing you all a great day ahead. Happy Independence Day to all. Thank you. Thank you. On behalf of Kiri Industries Limited, that concludes this conference. Thank you for joining us, and you may now disconnect your lines. Thank you.