Manorama Industries (NSE:MANORAMA) Q1 2027 Earnings Call

0:00 Ladies and gentlemen, good day, and welcome to Manorama Industries Limited Q1 FY 'twenty seven Earnings Conference Call. 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 Mr. Hiral Kenya from LLP. Thank you, and over to you, sir. Thank you, Huda. Good afternoon, everyone. On behalf of Manorama Industries Limited, I welcome you all to the company's Q1 FY 'twenty seven conference call to discuss the performance of the company and to answer your question.

0:49 We have with us the management team comprising of Mr. Ashish Sarraf, chairman and managing director, mister Ashok Jain, director and CFO, mister Pankaj Girati, BGM accounts and finance, miss Ekta Soni, AVP, investor relations, and mister Deepak Sharma, Company Secretary and Compliance Officer. Before we proceed this call, I would like to draw your attention to the fact that today's discussion may contain forward looking statements that are subject to various risks, uncertainties and other factors, which will be beyond management's control. We kindly request to bear in mind that there might be uncertainties while interpreting such statements.

1:34 Please note that this conference is being recorded. We would now like to start the session with opening remarks from the management team. Afterwards, we will open the floor for an interactive Q and A session. I would now hand over the conference call to Ashish Ji for his opening remarks. Thank you, and over to you, sir. Thank you, Hiraji. Good afternoon, everyone, and thank you for joining Manorama Industries Limited's Quarter one Financial Year twenty twenty seven Earnings Conference Call. We appreciate the continued trust and encouragement of our investors, analysts, stakeholders, As we continue to strengthen our market position and expand our global presence, we remain focused on executing our long term strategy, driving innovation and delivering consistent, sustainable value creation for all our stakeholders.

2:45 We have entered financial year twenty seven with strong conviction and momentum, delivering a 39.5% year on year revenue growth in quarter one financial year twenty twenty seven and crossing the 4,000 million quarterly revenue and EBITDA milestone for the first time. Our profitability grew by 67.6% year on year, reflecting sustained demand across new and used industries, deeper customer relationships and the increasing contribution of our value added specialty, fats and butters portfolio.

3:34 These results underscores the strength of our integrated business model, robust sourcing network and our ability to capitalize on the expanding opportunities in the global specialty FACS market. During the quarter, we achieved several strategic milestones that further strengthen our long term growth platform. We expanded our sourcing footprint in West Africa through the incorporation of Manorama, Savanna, Egochad, Sal, Inchad, our wholly owned subsidiary, Inchad. In addition, we acquired approximately 10 hectares, 24 acres of land in Burkina Faso for a sea nut and mango nut processing facility with regulatory approvals currently in the progress.

4:34 These initiatives enhance sourcing security, visibility, supply chain resilience the pleased global market. Years. We Our MILCOA research and development center recognized by the Department of Scientific and Industrial Research, G and R, Government of India, continues to drive product innovation and strengthen our competitive advantage. Beyond product development, our R and D capabilities are playing a pivotal role in shaping our integration strategy as we advance both backward and forward integration initiatives.

5:29 The upcoming seed processing and extraction facilities in Raipur and Burkina Faso together with our exploration of downstream value added opportunities are expected to enhance value capture, improve margins and drive sustainable growth across the value chain. The successful completion of our qualified institutional placement, QIP marks another important milestone, strengthening our balance sheet and providing the financial flexibility to accelerate growth across manufacturing, sourcing and high value added segments. These investments align with our vision of building a globally integrated specialty ingredients platform with scalable and resilient supply chain.

6:26 Looking ahead, we remain highly confident in the long term prospects of our business. With an expanding portfolio of specialty ingredients, growing customer partnerships and increasing presence in cocoa butter alternatives and continued investments across sourcing, processing, innovation and manufacturing, we are well positioned to deliver profitable growth and strengthen our global market presence. Business has is business, business has risk, but Manorama navigates and has built a robust model, and we are looking forward to build it further.

7:12 We look forward to create a sustainable long term value for all of our stakeholders. With that, I will now hand over the call to our CFO and Director, Mr. Ashok Jain, to take you through the financial and operational highlights for the quarter. Thank you. Thank you, Ashish, and good afternoon, everyone. Let me now take you through our financial performance for the quarter one FY twenty twenty seven. We delivered a strong quarter with revenue increased by 39.5% year on year to four zero four crores, driven by a richer product mix of value added offerings and higher traction of our expanded technician capacity.

7:59 Our export to domestic revenue mix stood at sixty:forty, reflecting the continued strength of our global customer base alongside healthy domestic demand. EBITDA grew by 42.2% year on year to INR 106 crore, while EBITDA margin expanded by 49 basis points to 26.3%, supported by disciplined cost management, operational efficiencies and operating leverage. Profit after tax increased by 67.6% year on year, that is INR79 crore, with profit after tax margin expanding by three twenty six basis points to 19.5%.

8:46 This strong improvement in profitability reflects our continued focus on optimizing product mix, enhancing capacity utilization and driving efficiencies across operations. These reasons demonstrate the resilience and security of our business model, highlighting our ability to deliver robust growth and profitability while executing strategic expansion initiatives and managing the seasonal dynamics of our industry. We remain disciplined in our approach to capital allocation for ongoing strategic investment across India and Africa are carefully aligned with our long term vision of building and globally integrated Stelicipat platform.

9:33 This investment will strengthen our sourcing and manufacturing capabilities, expand our global footprint and further reinforce our leadership position in the rapidly growing cocoa butter equivalent and specialty fat butter market. Through these initiatives, we are creating a stronger foundation for sustainable growth, enhanced competitiveness and long term value creation for our stakeholders. That concludes my remarks. We would now begin with question and answer session. Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on the telephone telephone. If you wish to remove yourself from the question queue, you may press star and 2.

10:21 Are requested to use handset while asking a question. The first question is from the line of Kumar Soumya from Ambit Capital. Please proceed. Hi, sir. Good afternoon. Firstly, the very commendable performance in a volatile macro environment. So a couple of questions I have. Firstly, on the incremental capacity of 4,500 tonne, which is expected to come from the debottlenecking activity. When should we expect that to come online? Yes. Thank you, Kumar, for the question. As we have previously communicated, so we have undertaken the debottlenecking to enhance vaccination capacity.

11:12 So we already have done a portion of our additional capacity of INR 7,500 crores, which is already has been operationalized. And the balance is intending to be implemented in a manner during FY 'twenty seven around quarter three of this financial year, subject to operational time lines. Okay. And the incremental greenfield, when is that expected to hit in the next financial year? So this is regarding our new CapEx program? Yes, yes. Okay. So we have made a meaningful progress as we move on for our CapEx. So on the sorbent fractionation fee and our refinery are being targeted for commissioning around FY 2027, 2028 around Q3 of that financial year.

12:05 And we already have bought a land in Burkina Faso, which is around 10 hectares, approximately 24 acres bought, and there are regulatory approvals which are awaiting. So we are doing meaningful progress in terms of our CapEx also. And next on the downstream opportunity that Ashish mentioned in the opening remarks. If you could throw some light key, what are the downstream opportunities we are exploring currently? Sorry, can you repeat your question, please? Ashish, in the initial remarks mentioned about the downstream opportunities in the product value chain that you are currently exploring. If you could just throw some light, what are those? Yes, the expansion, which we are currently doing, one of our expansion also involves CV EcoCo alternative products, which will allow us to make a specialty value added product from our existing raw materials, and we are also using the interest to the right process from where we can make a value added product based on our co product or by product like olein and other specialty parts and butters. So we are around the clock. Our R and D team are working on those lines, making more and more value added product from our existing product portfolio, and we are setting up a technology also. It's our CVA plant, which will help us to bring more and more value addition in our product lines.

13:35 Got it. Next one, this export share in the revenue. What was it in the last year same quarter 1Q FY 'twenty five? 55% to 60%. So the range was we can share with you was around 55% to 60% only, and it approximately is in the range only of 50% to 60% of fixed quota. Okay. And lastly, on the LatAm progress. So what is the development over here? And when are we expected to see the ramp up in the coming quarters? Any color over there? So Kumar, we have started the trial production in the last quarter. We have sent some samples there because that is a new facility we are doing. So that production has to be go from our current facility, which is in India. And we are also planning to move that scale gradually. As we move quarter to quarter, we can see a good amount of production going there further to manufacture from there.

14:37 So that will ramp up gradually over the quarters. Okay. And lastly, some indication on the pricing environment. How are you seeing the current pricing environment? Because most of the products are seeing a lot of volatility. So how is your product value chain behaving and any color on that front? So Kumar, so our products are more value added product, which is formulated and based on certain specifications and recipes of the confectionery, chocolate or cosmetics. So our pricing model, if you say, has been remained stable largely, which is in line of our costing model as well. So as per the macroeconomics are concerned, so compared to that, our pricing has been largely stable.

15:24 Got it. Thank you. That is all. I'll jump back to Q1. Thank you. Thank you. The next question is from the line of from Asset Manor. Please proceed. Good afternoon, sir. Am I audible? Audible? Yes. So great set of numbers, sir. Thank you for the opportunity. A few questions I had from my side was realization for turn of CV and CDN. If you could give me that breakup, is that available? So we generally don't share that kind of personal realization because our products are not one SKU. There are different products with different formulations, specifications for different customers.

16:21 But we can share with you directionally that our pricing has been largely stable for our value added products. No problem, ma'am. And of this 71.4% of contribution of CV and steering, what is the breakup of CV in it? 71 of contribution and balance is the steering product. Both are technically the same. Yeah. Could you please repeat? How much was CVE? CTE was 20%.

17:08 Percent. Three zero thirty. Got it, ma'am. Got it. And could you please help me understand of this new subsidiary that has been established in charge and what exactly will it contribute to the company? Will it be a margin expansion from it, or is it helping from the banking integration? Is that mainly Because our all in... Yeah. Our international subsidiaries, which are in Africa, including the recently incorporated in chart, is mostly the vehicle from where we are sourcing our raw materials and orders from Africa region. So that chart is basically for increasing the value chain from there. It's one of vehicles through which we are going to source our Shihanate and butter from there.

18:13 As there is no response, I'm taking the next question from the line of from adviser. Hi. So my first question is around your contracts. Roughly, could you give us an idea of when you will be renewing some of the contracts? You'll have a nine to twelve month time frame. I just want to understand when the renewals I mean, what percentage are coming up for renewal in this year or in the coming quarters or something? So see, basically, our contracts are nine to twelve months, which is not specific to a certain quarter or certain month. So it is an ongoing process. So when and as and when the contract expire, it gets renewed. Some contracts could be for quarter one, some contract could be for quarter two, three or '4. So it's generally ongoing process with the customers. So we cannot quantify that with that this much of contract will be renewed in this particular quarter. So it is an ongoing process for us.

19:17 Got it. Secondly, what were the volumes in megatons of your value added products, that is general CVEs and clearance this quarter? So we utilized volume specific for our value added products, we don't check on a quarter basis. We could guide you on an annual basis when what we have been doing in the past quarter. But what we can share with you that we have done an utilization of around 80% on our capacity for this quarter. And any guidance on the full year number for utilization of your fractionation capacity? So we will be also doing the debottlenecking of our second plant, which will be around Q3. So we expect our to be around 80%, 85% for full year for this year.

20:11 Understood. Then I had a question just about working of as a client, given that it will reduce your freight costs, what is the quantified impact this will have on your gross profit? So this of course, it should help it because the investments, what we have envisaged is particularly for Burkina Faso plant. So we see a payback period, which should be around three years once the plant is operational in Burkina Faso. So it should meaningfully impact on that bottom line as well and should improve our efficiency also. So this is what we can guide you for that.

20:59 You're saying a three year payback on the roughly 120 crore CapEx. Is that the fair way to the credit? Yes. There is... I just want to understand that in places like Nigeria, they are... It's an export ban on Shia lands. Could you help sort of describe these risks and how you all will mitigate some of that kind of a risk? So see, Nigeria is one of the 22 such countries in Africa where the share has grown and available. And as you have seen, we are having multiple presence in Africa regions. We are operating our own wholly owned subsidiaries in 10 different regions in Africa.

21:47 And we are also going to set up our own facility in Burkina Faso. So we are also bringing the seats from there. And going forward, we will also import the water from there. So there so we also import waters from those regions. So that is one country which has put in a temporary ban. So that doesn't materially impact our sourcing strategy from there because our presence in that geography area is vast, is substantial in Africa region. Understood. Understood. And last question, if I may. Could you describe your PPA product? I mean, just some more color on what it is that you're planning to launch, which is separate from the current CPE and steering?

22:34 So we import lot of butters also from Shia and Africa region. CBE... So that CBE is a product technology. What we can say is an alternative on cocoa butter. So through a technology here in from India from an resource plant, we will convert some of the oil liquid fractions into a hard fraction using some enzymes toward it. So that would convert our liquid fraction into solid fractions that will help convert into cocoa butter alternative segment, which will be called ECB, enzymatic cocoa butter equivalent.

23:19 So that applications of cocoa butter alternative within that, which is ECV, will be... Of course, the application are staying into the food segment part, into the chocolate, in confectioneries, into the Horeca market, wherever there is a food application. So it is one technology. We are doing an addition, which we can save the forward integration model, which will help us use our existing raw material also, and we could use other raw material also apart from Tinac currently, which we imported by locally from domestic markets. Understood. Thank you so much for your attention. Thank you. Next question is from the line of Roshan Nayas from Antics Tom Broking. Please proceed.

24:12 Yes. Thanks a lot for the opportunity and congratulations on good set of numbers. So my question is regarding the Brazil partnership where you have started your first commercial production batch. So how much time would it take to for the commercial production to fully ramp up? And how meaningful can Brazil become over next two to three years in terms of revenue and profitability? So we already have started our trial production in the last quarter of this year, and we are slowly dispatching our production to that Brazilian entity to process. So it will, of course, take some time because a lot of production has to go from an Indian plant as well. So we see a good demand scenario, which is there for those products that are in as well. So slowly, it will pick up maybe in another two, three, four quarters, we can see it should gradual ramp up quarter on quarter basis from there.

25:12 And what would be the max revenue that you can generate from the Brazil unit? So we can guide you on specific contribution from Brazil once we have started the operation meaningfully from there. Currently, we are doing the trial production, but we can directionally guide you that we see a very good opportunity in that market through that unit. Understood. My next question is, sir, our employee cost has come down by around 20% versus last quarter. So in last quarter, I recollect you had some initial setup costs for subsidies that resulted in higher employee and other expenses. So is it fair to assume that this will be the run rate going forward?

25:58 Or is there anything else that we should be looking? Right. So last quarter, there was some provision, which was there, which is related to performance incentive as well. So that was largely the reason of that employee cost going forward. But currently, the run rate, which we can take should be around INR 14 crores to INR 15 crores per quarter going forward. It should be generally in this line only. Understood. And one last question from my side. So other expenses have kind of jumped up by 16%. So anything you want to call out specifically here? Or is it primarily due to higher freight and container costs? Yes. That is right. It is primarily because of that only.

26:44 Understood. Thank you. Thanks a lot for the opportunity. Thank you. The next question is from the line of Sandeep Abhangir from LKP Securities. Please proceed. Hi. Congrats to the number. Thanks for taking my question. So I had a question regarding the gross margin. Gross margins have gone down this quarter. Firstly, what was the reason behind it? And how was the sourcing of Xi'an Hudson Butter for FY 'twenty seven? Is it totally done? Or it will be done by the H1 FY 'twenty seven quarter? And how is the pricing scenario in your raw material sourcing?

27:41 So largely, ShearNet procurement largely has been done in the last quarter. If you see currently, we have done the procurement for our Indian domestic seeds, which is Sal, Mango and other exotic seeds. And we buy Shia nuts and butters from different countries of Africa region. We buy salmon mango from different parts of India as well. Pricing from pricing point of view, it is broadly same, but of course, whatever inflation rise is there, we have to take on the raw material cost, and that's how we build our costing model and come to our finished goods prices accordingly. And our gross margin broadly moves in the range of that range only of around 45% to 50%, what we can say, because a lot of time, it depends on fixed cost timing also and that by product realization, which is a de oil kick.

28:41 So and it will be best fed together with EBITDA margin rather than in isolation of gross profit margin. Okay. Okay. And on the raw material cost as percentage to sales is considered, for H1, generally, is higher, somewhere around 75% to 80%. And for H2, it is comparatively lower. So on an overall basis, FY '27, what kind of cost of raw materials we can expect for this year? So it has always been around 50% only, but we are not able to see that it was around 75%, 80% in first half. But as per us, it has always been around 50% to our thing, approximately.

29:34 Okay. Okay. That comes from my side. Thanks for asking me the question. Thank you. Thank you. Next question is from the line of Madhu Agarwal from Agarwal Family Office. Please go ahead. Hi. So of the 39% growth we've seen this quarter, would you be able to break that down into how much was volume growth, how much was due to Forex, and then how much was ultimately realization? See, 39% growth is Y o Y growth, which is there comparatively last quarter of same quarter of last year compared to this, and it is largely volume led. So we can see 85% growth if you compare Y o Y has been approximately from the volume growth.

30:25 Okay. Lovely. And then my next question is on the existing capacity. Could you please clarify what is the incremental capacity you're expecting from the debottlenecking at the second half? So approximately, we are expecting additional 4,500 tonnes of debottlenecking in this financial year, additionally. So our current capacity of 47,500 will be going to around approximately to around 52,000 tonnes per And in terms of the margins that we've seen this quarter, would you say they're sustainable or was this exceptionally an exceptionally good quarter? Sorry, can you repeat your question, please? For the margins that we've seen in Q1, would you say they are sustainable?

31:15 And should we would you guide for similar margins going forward? Or was this an exceptionally good quarter? See, margins can see modest quarter to quarter movement depending on mix and one off items, but the underlying range is expected to hold broadly stable. So at the same time, business is business, business has risk also. But we say it should hold the current range in broad terms. Understood. Okay. That's all for me. Thank you. You. The next question is from the line of Akhil from three sixty one Capital. Please proceed. Yes. Hi. Thanks for the opportunity, and many congratulations on a good set of numbers.

32:06 And my question is on the subsidiary part. If I look at console minus stand alone, the revenues are close to zero, and your tax losses have declined from 8 crores, 3 crores this quarter, basically. While the... Well, actually, the revenue was probably around 8 crores, and the losses were 8 crores. So if you can help tie up these two things, basically. So maybe consolidated turnover, if you talk about, I guess, there is a difference of around 4 to 5 lakhs, which has been reported in the numbers compared to stand alone and consolidated for this quarter. It's not a question. Like, for this quarter, revenue is probably just INR 4 lakh, while the losses have reduced dramatically from INR 8 crore in fourth quarter of 'twenty six to INR 3 crore.

33:03 Yeah. So why that has been what they were able do? Yeah. Last time, as we have explained, there was... That last time, there was onetime cost, which has incurred in some of our subsidiaries. As we have explained earlier also last time we called because of that, and this time we see this cost, what have a bet is on a normal operational cost basis, which is there for our different subsidiaries. So So is it fair to assume... Yeah. Sorry. Is it fair to assume that the losses will now reduce as we move forward basically from subsidiaries? Because our overseas subsidiaries are at different stages of maturity, and West African entities are mostly for cost procurement vehicles with no stand alone revenue.

33:55 So consolidation carries some operating costs without corresponding top line. So Brazil also is in a build out phase as we establish commercial volumes. So these are deliberate funded investments in the long term capability. And we see as these entities scale, directionally, their drag on consolidated margins should reduce and over time turn into a contributor. Sure. Two more questions. One on other income part, it has gone up significantly. Is it to do with the UIP money, and how should one look at it for a Akhil, sir, sorry to interrupt, but can you please stay in the quiet room? Like, there's a lot of disturbance from my side.

34:42 Sure. Just... Is it better? Continue. So my second question was on other income part. Right? We did around 60 naught for this quarter. So how should one look at it on a full year basis? And the third question is if you can give a ballpark CapEx guidance for this year and next year. So ballpark CapEx guidance for this year should be around INR $2.25 to INR $2.50 odd crores of investment in financial or approximately in financial year '27. And likewise, with other income, it's largely because of freight and other Other income is largely for income and ForEx gains.

35:31 So it is nothing to relate it with the QIP amount as you mentioned for that because that amount we have received in this quarter. Okay. Okay. So it should get normalized probably then? Yes. Yes. Okay. Okay. Great. That's all from my side, and best of luck for current parts. Thank you so much. Thank you. Thank you. The next question is from the line of Nishita from Capital. Please proceed. Yes. Am I audible? Yes. Yes. Yeah. So I just wanted to understand the CapEx that you just mentioned of around $2.35 to $2.50 kur. What are we going to use that for? Like, for debottlenecking, how much CapEx are we going to use?

36:19 And what is the rest of the amount? Where are we going to use that? So this $22,252.50 approximately amount is... Will be used for our new CapEx proposed, which is there, where we are expanding our sorbent vaccination capacity, refinery capacity and the backward integration project in Burkina Faso. So that debottlenecking capacity is hardly a cost of around INR 5 to 6 crores, which will be there to debottleneck. Apart from that, all that money is going to be invested in new proposed CapEx plan. Right. Okay. So from what I understand is this solvent fractionation and refinery capacity, this is coming in our Indian facility. Right?

37:18 Hello? Hello? Yeah. It is coming in India. Refinery and pollen vaccination. And and extraction and expelling capacity in Burkina Faso, Africa. Okay. So if you could bifurcate the CapEx there, so how much are you going to use for the Burkina Faso facility and then the Indian facility? So that Burkina Faso facility will be around $120.30 odd crores approximately, and the balance should be for Indian projects out of $4.60 crores of our proposed CapEx plan. And this will be operational by q three FY twenty eight. Right?

38:09 Tentatively. Yes. Both the facilities. Yeah. Our CapEx program. Yes. Okay. Okay. And my next question the so if you can give the revenue bifurcation from Sheawater and then the Sanango, there is a revenue bifurcation. So our revenue contribution from each of the raw material is significant. So if you want a bifurcation, it will be around 50, 60 from imported seeds, and it's 50 around is from domestic seeds and butters. So import butters also and seeds also from different parts of the world, and we sourced some seeds and all also from domestic. So the bifurcation will be around 50%, 60% largely in same.

39:14 Right. And my last question is on track to achieve our guidance for this year. You you already provided a guidance of around 1,600 to 1,800 per month. Sorry. When we have provided this guidance? In one of the conferences, the Ashika conference. That was way back in November. I just wanted to check if we are still on track for that. No. Because, see, we have given our guidance on the utilization for our facilities. So in terms of numbers, you can extract the numbers or model it as per your calculations. So what guidance we are giving on the utilization basis, which we should see around 80% of utilization on 52,000 tons of plant capacity for this year.

40:08 Okay. Understood. Thank you so much. Thank you. Thank you. The next question is from the line of from SNC Private Wealth. Please proceed. Hello. Am I audible? Yes. Hi. So I just wanted to ask about the recent development which you had posted a day before yesterday. So in context of that, has the supplier accepted the liability, or is he willing to pay the amount which you have created a debit note for? And can you also confirm whether the company will be sourcing from the same supplier, or are we diversifying the supplier base?

40:55 So we already have a very diversified suppliers for this material. We import from couple of countries with different suppliers. That is one supplier from that region, and we are not currently based particularly on that particular supplier. Manufacturers. Manufacturers and suppliers. So at the recovery, how much amount can we or how much percentage are we confident that we will be able to recover the amount from the supplier? So the... This is... Of course, as you have seen in the exchange notification also, we are in the process of we already have raised our debit note, and we are claiming the full amount to be from the manufacturer and the supplier of that product.

41:46 And we are in the process. And with a certain time, we are confident when we should be fully see what we can do in terms of our recovery from that manufacturing supplier, and we will update you from time to time what has been progressed as per our safety regulation. Thank you so much. And secondly, are we dependent on any particular shipping route for our import or exports of raw material or finished goods? Because as we can see, there is a lot of geopolitical disruption. So if you are dependent on a particular route, how are we going to mitigate the impact? See, we are dealing with multiple geographies.

42:32 If you see, we are supplying to more than 30 countries in the world, and there are different routes for different countries. We import a lot of materials from Africa, Malaysia, Indonesia and a couple of other countries as well. So that's why if you see our diversification is very much high in terms of our exports also and in terms of our sourcing also for our raw materials. So it should not that materially impact our sourcing strategies for any of our raw material base. Alright. Thank you so much. All the best. Thank you. Thank you. A request to all participants, please restrict your questions to two questions per participant. For more questions, please rejoin the queue.

43:20 The next question is from the line of from Fintrest Capital. Please proceed. Mister, are you there? I'm out here. Yeah. So first of all, sir, congratulations on a great set of numbers. I can see in the presentation that we had uploaded on the exchanges yesterday that, you know, you have said around 85 to 90% utilization of the expanded capacity. Like, that added the 4,500 debottlenecking and 47,500 already there. So... And now we are saying that it's it's going to be around 80%, if you can just clarify on that.

44:12 Only execution... Executing target for the company is that, but for our stakeholders, we can take 80%, and whatever improvement is there will be shown and will be shared to our stakeholders. Okay, sir. Okay. Okay. Thank you, ma'am. And also, are we... So are we confident of, like, you know, having the same quarterly growth or year on year growth, if I'll put it? And how is the external environment shaping up? You know, there are many geopolitical tensions, also the ban on the exports. So do we see that a whole Africa or it's just a a specific country? To just repeat what we have been saying that this branch, of course, we are talking now for a couple of quarters now. We are seeing this macroeconomic geopolitical tensions going around for a couple of quarters now in the past.

45:11 But the company, of course, we are part of the industry. We are part of this full fraternity. We cannot say that it will not any way not impact us directly. But of course, there is an indirect impact, which is there in terms of freight, logistic or could be other macroeconomic impact could be there. But as a company, we always navigate it and balance it out on what possible ways we could do in terms of our sourcing, exports, managing our productions and keeping our checks and internal things in line, which should help us in meeting our goals and targets. Okay, ma'am. And also on the the last question is that if I heard it right, you mentioned that, you know, the new CapEx of $4.60 crores is going to be coming live in the quarter three of the next fiscal year. That's '28.

46:09 So I... Can I can I connect it directly that, you know, it will start contributing to our top line from q three? Of course, that is being expected and it will be to commission around that quarter. So it should start contributing gradually from that period. But that full impact will be more visible in the FY 'twenty nine as we ramp up because all these are technical plans and utilization takes place gradually so that you can see that it is more visible in the year of FY 'twenty nine. Oh, okay. Thank you so much for answering my question, and ma'am, all the best for the future.

46:57 Thank you. You. The next question is from the line of from Manorama Enterprises. Please proceed. Hello. Good afternoon, everyone. Ma'am, my first question is regarding how much CapEx have we already spent in this quarter out of the 02/25, two fifty that we have planned? So if we talk about this for this quarter, we have spent around 20 odd crores through Manorama and our subsidiaries. And till today, we have spent around 70 crores out of our total proposed CapEx plan, and we intend to spend approximately around INR $2.20 odd crores more this financial year for our CapEx.

47:43 All right. Would you be able to give us how much money we spend to purchase the 24 acre plot for the backward integration plant? But we would not like to specific maybe on part to part. We already have communicated that we are going to spend around 120 odd toward Burkina Faso project, but we would, as a company, not be comfortable to share all the finances for each of our investments. Thank you. Do we have any numbers regarding the Decal Corporation? What kind of... I mean, we don't have any numbers. Like, what revenue, what margins per decade.

48:31 So as of now, we have not done... Started the... And currently, we don't have any specific numbers to share with you from particularly revenue from the decal environment. But one thing we need to understand that decal, there is a processing facility, the production is going to be going from the Indian plant only. So that revenue will be more visible from the Indian plant, and that facility is a processing facility just for a material going from Manorama Industries Limited India. Alright, ma'am. Thank you. That's it from my end. Thank you. Thank you. The next question is from the line of from AK Investment.

49:19 Please proceed. Hi. Thanks for the opportunity. And first of all, congratulations on the great set of number. Ma'am, my question was about... Around the CapEx. So as you already highlighted, for 60 crore CapEx will be spent till two quarter three of FY twenty eight and then contribution will start from gradually. Right? So my question is currently our asset turn is around seven x. So can we expect the same seven x asset turn going forward in FY twenty nine, FY thirty when this new facility will be fully ramped up? See, we always have intended to reach on a higher asset turn thing, but to guide you that it will be 7x, 8x, 9x currently today will be not feasible for us.

50:08 But what we can say is historically, what has been there in terms of our CapEx investment, the company will be aiming to perform on that direction only going forward. But we are very much positive that our new investments in terms of our proposed CapEx plan should give us a good, steady, healthy growth for our near term vision for our two, three to five years, I... For FY 3031, we should be there. Okay, ma'am. And my my second second question is around the full year top line expectation. So do we have any general expectations, not for absolute number, but in the percentage terms? Do we have any range for the growth and also the EBITDA margin? Can we expect the same EBITDA margin going forward in the next three quarters for FY twenty seven?

51:04 Sir, directionally, what we can guide you as of today that, yes, we have started financial year 'twenty seven on a very healthy note, as you have seen in the performance of what we have published yesterday. And with the Q1 performance providing a good base, establishing a good run rate for the year, we also see further scope of improvement as the year progresses. They are supported by capacity ramp up, debottlenecking is to be done and a good utilization is to be done from our plant. So also, we are very confident on delivering healthy top line growth in FY 'twenty seven as well. Okay, ma'am. And lastly, on the you have said that forty forty five hundred MTPA that we are de bottlenecking.

51:53 So 85% utilization is on the... That improved capacity, right, in the full year? Yes. That you can say that 80%, 85%, the management internal target is around that execution level. But as a stakeholder, you should take around 80% of utilization. Any improvement, which is there around 85% or 90% will be shown and communicated to our shareholders accordingly. Oh, okay, ma'am. Okay. Thank you so much, and all the best. Thank Thank you. A request to all participants, please restrict your question to one question per participant. For more questions, please rejoin the queue.

52:39 The next question is from the line of Abhijan from AJ Capital. Please proceed. Hi. Good afternoon. Hope I'm audible. Yes, sir. So I'm just following up on the question of, you know, maintaining the asset term that you have been you have been able to achieve in FY '26. Now as this CapEx of INR $4.50 odd crores comes on board by FY 'twenty eight or the second half of FY 'twenty nine or the first half of FY 'twenty nine, apart from the revenue, my second question was on the working capital. So if I look at the past history of Manorama, right, if this INR $4.60 crores of CapEx produces a Selenex asset turn, it will also require close to about INR 900 odd crores, INR 2,000 odd crores of calculation.

53:30 So can you help us guide or understand how do you see additional working capital that you'll be requiring over the next two years and any plans on countries or how do you manage it? So some guidance or some hinder on that. So yes, there is a requirement of around 50% in terms of raw material for our business and the kind of asset term, which you have mentioned and what we have done over the past. For that, we are very much lined up with our existing tankers. And recently also, if you see, we have successfully completed our fundraising QIP, which is which was around INR 500 crores. That only money what we have, we also have INR 150 odd crores FDR in form of FDR in company with us, excluding the QIP component.

54:26 And apart from that, we have sanctioned bank limits with us, where State Bank of India is our lead banker. So we are very much aligned with our near term vision for this CapEx plan as well in terms of working capital requirement. So sorry, so you're saying any additional working capital over the next two years will be made by debt and not necessarily by equity dilution. Is that a fair understanding? We already have done the equity dilution in the last quarter, right? We have raised INR 500 crores for that. So of course, we don't need that equity dilution again in a quarter or two for our tax. So that is not there in the plan, of course not. The next question is from the line of from Pickon Family Office. Please proceed.

55:29 Hi. Am I audible? Yes. Perfect. Thank you so much for the opportunity. So on the other income of about 16 odd crores, could you break that down? How much of it was from forex gain? And on your hedging policy, you know, as per last quarter, about 60% is currently hedged. So I'm just trying to understand the rationale of why not move towards, you know, fully hedged position instead. The historical business policy, we always have been hedging 50%, 60% of the net exposure what we have because already we do a lot of imports and exports. So we are a natural hedge company as well. So whatever net exposures are left as a policy, historically, we have been hedging 5060%, and that has been in line what the management requirement is. And out of INR 16 crore of other income gain, INR 13 crore gain was from ForEx part, and the rest 3 crore was in the form of other income, part of FDR.

56:37 Okay. Okay. And on the, I just want to understand the Sorry to interrupt you, mister, but can you please rejoin the queue? Thank you. The next question is from the line of from Investment. Please proceed. Yeah. My question is on the margin trajectory. With the additional capacities coming on... I mean, the new CapEx I'm talking about and, like, the size getting bigger, how do you see operational... Operating leverage kicking in the next two, three years for the company and also the improvement in the sourcing front? Yeah. That's it. See, we... To guide you what will be there in the two, three years today will be very difficult for us. But directionally, what we can say, we are in a good shape and operating leverage should come into the picture.

57:36 We are going to expand our capacities further. We are improving on our product mix as well. Historically, if you see the company has performed over the last three, four years, it has been 20, 25 consistent quarters where the company have given a good performance in terms of their top line or be it on a margin front. We have always guided our stakeholders that business is business and businesses always risk, but we are always working round the clock to optimize the full efficiency of our production. We value added mix and everything, and we remain confident on performing a good set of production going forward, and it should improve the efficiencies of the company as well. So from a margin point of view, we will say that whatever the company has been doing historically should be considered directionally as a margin thing. And whatever movements are there, we would be able to share you on a quarter to quarter basis going forward.

58:49 Correct. But I'm not asking for any specific number, but directionally, with all those things which you mentioned and I asked about, the margin should go up from there, right? Not a quarterly basis asking for that, but on a yearly or two yearly basis, the direction should be upward, right? So we would direct you for a more sustainable margin. We at this moment, we can guide you this only for that. Of course, there are multiple levers which are there, which are going to be there, which should take company in an improving trajectory only. But to guide you anything today will be a little difficult for us. So once we are there, we'll guide you for that. Sure.

59:34 Thank you. Thank you. Ladies and gentlemen, due to time constraints, that was the last question for today. I now hand the conference over to the management for closing comments. We are steadily advancing our aspiration of becoming the partner of choice for the world's leading food and confectionery and cosmetic companies through strategic investments in research and development, investments in R and D research and development, sourcing, manufacturing and market expansion. Backed by strong balance sheet, deep sourcing capabilities and increasingly integrated value chain, we are well positioned to scale our operations, enhance customer partnerships and capture the significant opportunities emerging in the global specialty ingredients market.

1:00:41 As we move forward, our commitment remains unwavering to drive sustainable growth, strengthen our global footprint and build a resilient innovation led business that consistently delivers value to all stakeholders. On behalf of Manorama Industries, I thank you all for joining the call, and we look forward to some of our stakeholders, our suppliers, our wallet dwellers, our customers and all people connected with Manorama. Thank you. Thank you. On behalf of Manorama Industries Limited, that concludes this conference. Thank you for joining us, and you may now disconnect your line.

1:01:27 Thank you.