Thank you, Ryan. Good evening, and thank you all for joining us on the Finolex Cables Q4 and FY26 earnings conference call.

Today we have with us Mr. Mahesh Viswanathan, Deputy CEO and Chief Financial Officer from Finolex Cables Limited.

We will begin the call with the opening remarks from the management, after which we will have the forum open for the interactive Q&A session. I must remind you that the discussion in today's earnings call may include certain forward-looking statements, and must be viewed, therefore, in conjunction with the risks that the company faces.

Please restrict your questions to the quarter performance and to strategic questions only. I would now request Mr.

Viswanathan for the opening remarks. Thank you, and over to you, sir.

Thank you, Pranay, and welcome, ladies and gentlemen, to this call. I'm sure you by now have seen the results, analyzed and dissected it at your ends.

Briefly, I will go through the highlights as I see them. Revenue for quarter four was up by about 22% both year on year and quarter on quarter.

For the full year, revenue was up by about 19%. EBITDA for quarter four, there was a 7% improvement year on year and 22% quarter on quarter.

For the full year was about 14% better than last year. PAT for the year for the for quarter was approximately 6% better YoY and 19% better quarter on quarter.

PAT for the full year was about 14% better than last year. These are broad numbers.

Of course, quarter four we towards the end of quarter four, we had the shock from the Middle East, which resulted in cost increases across the board. While the LME copper did stay low for a couple of weeks, the rupee depreciation as well as cost hikes in most other raw materials meant that at the end, we were left with a higher cost of production than before, and therefore margins were slightly under pressure.

If I go into the individual segments, for electrical sector, revenue was at 1,697 in the quarter, was the highest that we've achieved, and it was about 22% higher YoY and 21% higher quarter on quarter. For the full year, about 22% higher than the previous year.

EBIT numbers were also fairly strong, 30% higher on quarter on quarter basis and 17% higher YoY. For the full year, EBIT was about 18% better than last year.

Some comments on the sector: there were certain product lines which did extremely well, and certain product lines where the growth was slightly lower, and one product line where the growth was actually lower. Auto batteries, flexible industrial flexibles, and power all these sectors did extremely well, generating approximately high double-digit growth in volume terms.

Auto was about 30% higher, flexibles was about 17% higher, and power was about 21% higher. Solar cables, which we introduced last year on the fourth quarter, has been very well accepted, and we are nearing capacity utilization at this point in time.

We are looking at increasing the capacity going forwards. Building wire was steady, but had been impacted through the year because of constant copper price increases, and which meant that we had to pass it through to the customers, there were times when there were resistance from the market.

Overall in the year, a very marginal volume growth. Agricultural applications was one area where there was an issue.

The pre-seasonal monsoon plus continued monsoon both impacted the volumes here. It was down by about 15-16%.

The year-end Middle East disturbances, like I mentioned earlier, had some impact in terms of increased RM cost. Together, coupled with INR depreciation, meant that the overall cost of production was higher, inventory costs crept up a little bit, and that, of course, impacted the end-of-the-year margins a little.

We had during the year close to 14 price changes, all upwards, and effective price change at the market was about 24-25% in most of the SKUs. This is on electrical.

Coming now to communication side, revenue, if you saw, was kind of flat for the year, whereas quarter four we did well. We were up by about 30% YoY as well as quarter on quarter.

Some background to this: fiber prices during most of the year, at least for the first nine months, were for for seven, eight months were pretty low, but started hardening towards the end of quarter three and since then have continued to climb. Some of the reasons behind this: there is an explosion of data center applications in the US and in in Europe, which is practically eating up all available fiber supply.

Currently raw material availability is a constraint for everybody. Most most capacities in in China and Japan are locked completely.

Added to this is the newfound military applications that have also pulled in a lot of fiber. Both the wars in Russia and in the Middle East have triggered newer applications, and apparently fiber is getting consumed there.

That's that has resulted in a short-supply kind of a scenario at this point in time, which has helped the fiber prices harden. I think the advantage to us in terms of improvement in revenue we should see some during the second half of this year.

Our commitments locally, domestically, have been long-term yearly contracts, and those were at fixed prices. Until those contracts run out, we will not see the benefit coming into our financials.

Hopefully next year when we renegotiate the prices, that should change. On the fiber-related expansions part, we have completed the we have commissioned the preform plant.

I said in the last call that trials were likely to begin from January and sorry, begin from February and end in a month's time. Mid-March, we commissioned the plant, and the the plant should take another two, three months to settle down and stabilize.

As of now, we're very the performance is quite encouraging. The second part of that program, which was the fiber draw capacity expansion, that should get completed by I think July or so.

Some capex will still come in the current year. The preform-related capex, phase one, where we were setting up the plant for 100 metric tons, that has been completed now.

Coming now to capex, overall we have spent about ₹240 crore last year, including infusion into the JV with Sumitomo. The in in the current year, that is 26-27, we expect to further spend another ₹200 crore on capacity expansion plans and complete the optic fiber preform-related capex, which is remaining, that will be another ₹100 crore.

That will be the total spend in the current year. On cash flow, the cash flow from operations was about ₹50 crore lower than last year.

Towards the end of the year, like I mentioned earlier, after the disturbances started in the Middle East, we had to take additional inventory coverage. If you looked at our numbers, balance sheet numbers, the inventory is up by about ₹300-odd crore.

Part of that investment has gone in there because at that point in time, nobody was sure how long this this war would last or what impact it would have in the medium or even short term. We needed to protect ourselves to be able to run the plants in April, in May.

Some amount of pre-buying, but at higher expenditure, was was done. I think we should be able to pass on the costs over a period of time to the end customer.

It should not be a very long drag on the margins. The other piece of information that I have is that the JV with Sumitomo, the extra-high-voltage JV with Sumitomo, that turned profitable this year.

On a revenue of about ₹450 crore, we generated a profit of about ₹21 crore. The outlook is is decent.

We have we start the year with an order book of about ₹380 crore. I think we have turned around the corner there.

This is broadly the comments that I had to make before giving the floor to you. I'm now free to take questions if you have.

Thanks for the opportunity. First, obviously, I would like to congratulate you on your new role.

Thank you. Sir,

my first question is on the communication cables segment. Obviously, when we look at the quarter, this was the record quarterly performance on the revenue side.

Even we saw some improvement on the margins, which would have been because of the scale benefit also. Now preform benefits are yet to kick in, and we have seen relatively better improvement on the margins.

As you highlighted in your opening remarks that given the demand, especially from the West markets, and some supply challenges, there is a huge scope for business into communication cable segment. For our purpose, how should we look at the growth from here on, and probably where do you expect, given the current prices, where should we expect that the margins probably by FY27 should settle for communication cable segment?

That's my first question.

Okay. At the moment, like I mentioned, supply chain, there are still some challenges.

One is on the regular business side, there is a extremely high demand towards data centers. Beyond that, there is this military application, defense application, which is also pulling in a lot of material.

There are some restrictions in being able to participate in that because your raw material supplier also puts in covenants saying this cannot be used for military applications, and so on. The opportunities then get a little limited on that side.

I think we will get a little more clarity once there is some finite information about what's happening in the Middle East. That keeps spooking the markets every other day.

To predict what we will end up with at the end of '27, even though it is not a long-term prediction, is a little difficult at this point in time. Also because of the exposure to defense applications, some governments have put in embargoes on export of certain raw materials.

We need to work around and see how those challenges are overcome. While there is a big opportunity at this point in time and the prevailing fiber prices are fairly high, at the same time, securing the required raw material also poses certain challenges.

We need to work around that. At this point in time, I am not able to really commit to a number or even predict a number.

I think it should improve beyond what we have seen this year. This year, we ended the year with about I think EBIT numbers were about 6%.

I think we should do better than that.

Sure, got it. Sir, my second question is on the JV.

After a long period, we have taken a lot of efforts on the EHV side, and probably this is the first year where we have finally seen some numbers actually flowing in. Can you highlight what are the steps that we have taken, how should we look at this business from a two-year, three-year view where we can actually end up by FY28 or '29 in terms of revenue?

Because PBT when we look at ₹21 crore at ₹458 crore of revenue, close to around 5%. Probably the things are looking relatively brighter here.

What's the overall thought process on this business?

Okay. There has been it has been a challenge for us over the last several years that we've been invested in this JV.

Challenges were mainly around, getting credentials for participation, showing experience, and some of the voltage grades becoming commoditized in the meantime. In the last year, our focus was more on the higher voltage grades, and also a mix of projects where there were only supplies and projects which were turnkey turnkey basis.

That gave us a little bit of the I mean the once we started getting in purely supply orders, then the cash turnaround times became smaller, whereas when you get into a into a project-based business, then the turnaround times are much longer. Typically, you are unable to clear your receivables until the entire project is completed.

With the EPC part involved, getting clearances and right-of-way in many of our cities or even sometimes in villages becomes a time-consuming issue, which drags the project for longer periods. This year, we've been able to get an order blend of both pure supply as well as full turnkey solutions.

That improved the operations quite a bit. The second part was to ensure to ensure and see that the key equipment, the capacity utilization improves further.

At this point in time, the most key machinery there is occupied more than 80%. In fact, we are planning to enhance capacity there so that that would help us in increasing the overall plant capacity towards the 70-75% numbers.

Utilization of capacity has been better this year, and that means fixed cost absorption is obviously better, and a focus on the blend of orders that we were getting. I think that is going to continue to drive the strategy.

On the market side, there is a very large market. Currently, I think the size is about $0.5 billion to $750 million.

The requirements that we are seeing when we talk to utilities across the country, eventually in 3 to 4 years, that size could go up to $4 to $5 billion. That's the kind of market expansion that we are seeing or we are likely to see.

It's also it is also backed up by the fact that many in the competition are today trying to and sorry, some are adding and some are trying to add capacity of similar technology that we have. Until last year, they were not willing to spend that money.

Over the last year, we have seen many more from the competition follow the same of same technology that we have in terms of the vertical insulation. That is something that is catching up.

Both from the market side as well as from our own experience, we see that there is scope for growth.

Sure, sir. Sir, lastly, this

Sure.

Hi, sir, good evening. I had one question in particular.

When we look at housing wires, that hasn't been doing well for us as well as the industry as much as we would have liked, particularly considering how real estate cycle has been over the last few years, particularly post-COVID, it has picked up quite sharply. What is stopping wires as a segment to grow at least, let's say, in high single digit in terms of volumes?

I think the runaway price escalation on copper probably, in terms of trade stocking, is not at conservative levels. They are looking at it fairly tightly.

Because like I said, we've had 14 changes over the last year, and we've had one more this year. I think that's been an issue.

Where the material is going to projects, we don't seem to have a major issue. It's the retail part of stock and sell which is, I think, a concern.

For a distributor, a dealer to invest fair amounts of money and hope that the price holds, I think that would be a challenge. That is a risk that less people are willing to take at this point in time.

Sir, I meant the tertiary demand. Now given wires as a proportion of doing up a house is so small, why are we seeing volumes not picking up, or people deferring their purchases as far as the tertiary sales and housing wire is concerned?

Which is what I responded saying when I meant project sales, those are the sales which are going into builders or contractors or developers. That is still stable.

That has not dropped off. The retail one where you go to the hardware market or the electrical market, and where the distributor is selling it or the dealer is selling it, that has taken a hit.

Understood. Do you expect a similar phenomena to play out in FY27 as well given price increases, or we should see some bit of improved demand, let's say, in the next 12 months or so?

I am not going to put my neck out there. I do not know how to predict that part.

It depends all on the price movements finally.

Understood. Thank you so much, sir.

Thank you.

Okay.

Hello, sir. Thank you for the opportunity.

Congrats on your new role. I have two questions.

Firstly, we showed an improvement in terms of margins for our communication cables business. Could you explain as to what caused this?

Is it a product mix or a pricing? What is the reason for this?

You had also mentioned in your opening remarks that we have some contracts with customers so the pricing may not change. Will we benefit when the fiber prices have improved, or will we not get a meaningful benefit there?

We should benefit, except that the time frame is probably around second quarter this year.

Got it, sir. The first question?

First question was, how did we get 6%?

Correct.

There were a few orders besides the long-term contracts, which were taken at current prices. That improved the numbers.

Sir. Just one last question related to this.

With our future orders, when we say we have contracts, what proportion of our business is contracted, and what will be unutilized or uncontracted capacity? Preform started only in this quarter, we will start getting benefits from that only in this quarter.

We also have Q1 one additional capacity coming for fiber. Will all these things change our overall revenue base in a meaningful way?

It should change, but you will not see it in quarter two. The preform part of it, like I mentioned, we commissioned it in March.

For any plant with this technology to settle down, will take about 3 to 4 months. I expect that benefit to kick in from the earliest I can talk about is end of quarter two or maybe quarter three.

The fiber draw capacity which will get increased, will get commissioned towards the end of quarter two. Any benefit that we would get from that will only be after that.

The second half, provided there are no other hiccups on the supply chain part, should be much better than last year.

Got it, sir. The last quarter, you had mentioned that your revenue potential can be around ₹650 crore after this entire capacity comes.

This quarter

itself,

we are clocking some ₹160 crore of revenue. Is this largely price driven?

At current prices, can the revenue be ballpark of ₹1,200-1,300 crore? It

again depends at the SKU level, depending on how complicated the construction of the cable is. For example, a cable which has got two fibers or four fibers, it's not a very difficult design to make.

You're just paying for the raw material. As it goes into multiple fiber counts or higher fiber counts, 144, 288, or even beyond that, then the revenue per kilometer changes and changes substantially.

It depends on what that order configuration looks like. Yes, given the price levels that are existing today, it can be beyond ₹750 crore.

Got it, sir. Thank you so much.

Hello. Hi, team.

Thank you for the opportunity. Am I audible?

Very clear.

Yes. Hi.

Congratulations on your induction to the new role. I had two questions.

First one being, sir, if I see the communication cable segment has shown a good growth in this quarter YoY basis. I was just asking you to what's our outlook over here in next few quarters?

Could we expect similar or such growth coming over the next few quarters as our preform capacities live? On the preform capacity, you did mention that we will try to consume it internally.

Then if we are left with the capacity, we will also try to sell it outside. How are we thinking on that?

Do we have tied up with the customers for the selling of that capacity? Then I have a follow-up.

No, at this point in time, right now, the situation is that, like I mentioned in my opening remarks, fiber availability is a big issue at this point in time. There is no fiber to be had anywhere in the world.

Any fiber that I can draw from my preform, I would use it myself. Selling a preform at this point in time probably not the right idea.

That is today's case. How it might change 3 months from now, 5 months from now, that is something that we will have to look at at that point in time.

The second part of your question was

On the growth in the segment.

Sorry?

Growth in the segment.

Growth in the segment, look, as you are all aware, like in the West, there is an explosion of data centers coming into our country as well. I think the government is also pushing to ensure that our data is hosted within our country and not outside.

I'm guessing that will add to the number of data centers that get installed here over a period of time. Yes, there is going to be growth.

There is also going to be growth with applications around AI and similar technologies. It is, I think, the right time to be in this industry.

Barring these hiccups around war disrupting supply chains, I think it should be a period of reasonably good growth over the next few years. Sir.

That's great to hear, sir. I just needed a clarification on the EBIT margin, segmental EBIT margins that you calculate.

I did see that communication cables seen a significant jump. I just wanted to make sure that have we included other income as a part of our EBIT margin calculation as well?

No.

Sir, I couldn't hear you properly.

No. Other income doesn't get included in this.

Other income is not included in this?

No. That is shown as unallocable items, no?

Okay.

At a company level, it gets included, but at a segment level, no. Is that clear?

Okay. I had company-level other income was around ₹32 crore, and at unallocable level, it's coming to be around ₹6 crore-odd.

I'm guessing the ₹24 crore would have been already included in above?

No. You're talking about the other income on the top line, right?

Yes. For this quarter, it's around ₹32 crore.

If you look at the total, that is around ₹237 crore for the year.

Right.

If you look at the unallocable total, that is about ₹224 crore for the year.

Hi, thanks for the opportunity. Am I clearly audible?

Very.

Sir, first question: what is our maximum revenue potential from the electrical cables segment? Currently, what is our utilization rate, and what is our target utilization rate for next year?

We keep enhancing capacities by rebalancing almost every year. Within the capex that we spend, there is a certain amount which is spent every year on adding to different lines.

Basis the capacity that was available let's say end of March, utilization would be around the mid-60s. There is some ability to grow further.

The maximum revenue potential?

The revenue potential can be at about 80-85, if somebody is operating, they're doing a good job because this is not a single machine, one process. These are multiple machines with multiple processes.

Not all of them are equally balanced. There will be always some bottleneck either at the beginning or at the end or in the middle.

Therefore, if someone is able to achieve 80-85%, I think they're doing a fairly good job of running their plant. There is a headroom of about 10-12% at this point in time.

Or 66 is where we are operating, about 15% headroom is still available. Your revenues at current prices can grow by another 15% without major investments.

Got it. Could you give the retail versus project mix this quarter?

Where do you see this going again because of the margins that play out because of this share?

Retail versus project, you're talking about electrical wires?

Correct.

I think in the past, our retail to project ratio would have been 80-20. Now probably it's around 2/3,

1/3. Okay.

Just last question on the communication side. What is our utilizable capacity for OFC right now, and when will we hit the 8 million fiber kilometer mark and our target utilization rate?

Because you said the fixed contracts will get over by quarter two, I think. If you could throw some light there.

The draw capacity that we have currently is 4 million kilometers. That should cross to 8 by hopefully by end of second quarter.

That means 8 million capacity will be available from beginning third quarter. So 4 million is what is available for us to operate at this point in time.

We are close to 3 and a 1/4, I think, at this point in time.

Sorry, our utilization rate you said is in optic fiber cables?

It will be about 3.2 out of the 4.

Okay. If we hit the 75% rate, we had guided 8% to 9% EBIT margins.

We've already hit 6%, is it right to assume that with earlier you said that it should improve going in FY27, we hit the 9% mark?

Subject to no supply chain constraints being there. There are supply chain issues at this point in time.

Things that we import, especially things that we import either from Europe or China, there are difficulties or time lags in getting those, so that needs to be resolved.

The fixed contracts problem should not ideally stop our growth, right, apart from quarter one?

No, that should not. We will renegotiate with them.

If the contract is valid until June, and the next contract when they come with the tender and the bids, we will renegotiate.

Got it. Within FMEG, what kind of growth did we see in the PVC conduits and fans business for FY26, just to understand?

Fan has been a difficult product line this year because in the initial part of the year, you had unseasonal rains. Towards the second half of the year, there were changes to the BIS norms, which meant that people were destocking any inventory that they had, and they wouldn't want to take fresh inventories.

That has been an issue. Fan actually did not grow in volume terms.

Conduits has done very well. Conduits, we are now operating at close to 85%, I think.

Sir. Can you just help me understand, in the communication cables, how much is coming from optic fiber and how much comes from other communication cables, on the rough base?

[70%?] would be optic fiber-related.

Sir, actually, I could not hear. Can you repeat it, please?

About 3/4 would be optic fiber-related.

3/4, okay. Sir, just wanted to understand, it's been 2 months since we started the preform plant.

Where are we getting, and how easy it is for us to get the germanium?

That is the challenge. I kept referring to supply chain difficulties.

That is the challenge. Fortunately, we do not require massive amounts, but it is a challenge that we need to overcome.

Currently, how much inventory of germanium would be there with us for how many months?

I think that is sufficient to run a few months.

Okay. Any kind of plans that we have for the FMEG segment as well that we're going to grow, or we are focusing right now on optic fiber more as a whole?

No, sorry, I didn't get your question.

I just wanted to understand if there is any growth kind of outlook that you can give on the FMEG business as well.

Our performance has been under par there. That is something that we realize and appreciate.

We are relooking at the portfolio in terms of what kind of products are we having there. Do we need to modify some of those?

We are also looking at how to strengthen the teams. Distribution is something that we've been working on, and that we will continue to engage with the distributors to ensure that both geography as well as products are fully covered.

It is going to be a continuous exercise this year, and we definitely want to make this a success in the same manner as the other product lines.

Sir. Thank you.

Hi, sir. Thank you for the opportunity.

Most of the questions have been answered, just want one clarification. I remember we met you in the month of December last year, and you have said we are working certainly something in the exports area.

How the exports are shaping up for us, and what is the exports percentage this year?

This year, our team was completely revamped. I think we've had our team in place for about 6 months of the year.

Yes, they have made certain inroads, and they have done well. Earlier year, 24-25 export performance was about 30 just around ₹30 crore, which went up to 52 this year.

I am looking at much higher numbers for the current fiscal. The team is a completely new team who are better prepared, I think.

I think we should be able to show a larger revenue share from the export side. Until last year, the revenue share was let's say about 0.5% to just under 1%.

I see it climbing to about 2 to 2 to 3% over the next two years.

Got it, sir. That's helpful.

Thanks a lot. All the best.

Thank you.

Congratulations on your new designation and very good result. My first question is given the situation, boom in solar not only in India, but outside of China also because of the energy crisis, and led by data center, defense, and others, optic fiber also, what is our potential to maximize capacity what we have, but double the capacity or enhance our capacity, and how much time will it take, and what kind of capex is required for that?

Current capex which you announced, what is our breakup of that?

The current capex that I announced includes doubling the solar capacity. We are cognizant of the potential there, and we are going to double the line there.

That would be helpful for us not just on the fiber side, but also on the power cable side, both for ourselves as well as for the JV. We are engaging with all those customers.

The gestation time for these orders is pretty long, you need to put time and the resources there before the order book starts. I think both the JV and us have certain amount of capacity to cater to the data center needs on power cables.

As I mentioned earlier on when I was talking about the JV, we are going to be looking at expanding some of the capacities there also. I think

What is our potential or capability to go further backward where communication optic fiber cables are concerned, from where we are at preform?

We are at preform next. If I have to go back, then I have to make silicon tetrachloride or germanium tetrachloride.

Which I think is, at this point in time, a point which is moot. I think we are stopping here for the time being.

Sorry, sir. I could not hear you what you said.

No, I said going behind preform means that we will have to produce the silica. At this point in time, that is not in our plans at this point in time, yeah.

Thank you for answering all my questions.

Sure.

Hi, sir. Thank you for the opportunity again.

I just to confirm two things, sir. One is you mentioned that the revenue potential from the expanded line can be around ₹750 crore.

I think right now, based on whatever

I meant including the existing stuff, the overall capacity. After we expand, then the capacity could be, the potential could be around 750.

Correct. That is for 8 million kilometers.

Is that correct? Right, right.

Right.

Okay. How will the benefit of preform show up, sir?

Will it show up as lower cost of production or how will that show up?

The one of the earlier questions also was, are we going to earmark a certain capacity to sell preforms outside? Now that is a possibility.

It depends on what the market conditions are at any point in time. It's a flexibility that we will have.

If I am short on cable orders, then on fiber orders, then I will sell the preform. It gives us flexibility.

I think overall, the intention is to use the preform to convert it into fiber, which again to convert it into cable and then sell it, which means our ability to participate in tenders where pricing sometimes becomes aggressive is available to us. Or depending on situations like today where the fiber prices are extremely high, we don't have to sell the preform.

We can convert it into fiber and take that profitability into the books. It is not a static, one-time chart that I will have.

It will be dynamic as the market demands.

Got it, sir. Just a related question I have, sir.

Here, when you mentioned that if we use it internally, versus previously we would have been buying from outside, what would the margin benefit be there from this?

I don't have the exact numbers in front of me, but typically once your production line stabilizes, you should be able to get it better than market. Whether I'm able to get it better than market at 5% or 10%, that would depend on how quickly I'm able to stabilize operations.

That's about as much as I can say at this point in time because I don't want to stick my neck to a single figure.

No, sir, I was expecting only a range. I'm not trying to get a very specific number.

That's what I'm saying. Depending on how quickly we are able to stabilize the operations, I think we should be better than market by anywhere between 5 and 10% because the preform seller is also making some money,

no? Correct.

Got it, sir. Thank you, sir.

Congrats on good set of numbers.

Thank you.

Thank you for the opportunity. Sir, if you could just repeat the capex figures that you mentioned.

Is it ₹200 crore or ₹300 crore? That's my first question.

Secondly, if you could also let me know what is your guidance for the coming years in terms of revenue and margins? Lastly, my final question is that this quarter, we've seen our operating expenses as a percentage of sales come down.

When I look at the past 12 quarters, we are in one of the sweetest spots. Currently employee expenses as a percentage of sales and other expenses as a percentage of sales, both are lowest in the past 12 quarters.

Do we expect them to continue in this range, or do we expect it to revert back to normalcy?

Let me answer your questions one by one. Your first question was on the capex.

I said capacity enhancement is about 200. Additionally, the plan of the expansion on the optic fiber cable side which were announced two years ago and which is ongoing, there is a balance of about ₹100 crore to be spent because like I said, the expansion to 8 million kilometers of fiber will get over in July or August.

All that will cost another ₹100 crore. Totally 300, out of which 200 is completely new, which is for capacity enhancements.

Is that clear?

Clear, sir.

Okay. Your second part was on guidance.

I actually do not give out any guidance, especially in a situation like today where you do not know whether the war is ending tomorrow, because you keep hearing that today it's ending, no, but it's not ending, and tomorrow I have an agreement, no, I don't have an agreement. It is a very volatile situation, I don't think I should be predicting anything.

All we do is internally, we have targets that we are working towards. That is subject to certain constraints not being there or certain level of constraints not being there.

At this point in time, I would not like to talk about any guidance numbers. There was a third point that you wanted.

What is that?

Our other expenses and employee costs as a percentage of sales, yeah.

I think on an annual basis, it should be similar. In between quarters, you might see differences, but overall at an annual level, we should be similar to what we have today.

To what we did in FY26?

Yeah.

Perfect. Great.

Thank you, and all the best for the future, sir.

Thank you.

Thank you for giving me this opportunity, sir. Congratulations on your promotion.

Sir, my question again is on the OFC side of things. Sir, if I see it from the first half of FY25 overall FY25 and overall FY26, I see the revenues from our communication seems the same, around ₹500 crore.

Correct.

I understand that, sir, that you are saying that in the first half of FY26, prices were depressed, they only started recovering towards the second half. Can you give in terms of volume?

What was the volume growth between FY25 and FY26?

About 7%.

About 7%, okay. What are we targeting, sir, moving into the next year in terms of volume growth?

Again, we made our budgets 2 months ago. At that point in time, the expectation around what is happening in the Middle East was that it should settle soon.

It's been 3 months since that act started, and no 2 days are different. You go back and forth, back and forth, back and forth, there is no clarity as yet, which means quite a bit of the supply chain is impacted.

Then you heard someone ask a question about germanium. Again, the supplies have to come either from China or from Europe, and both have put serious restrictions on exports from their side because they themselves have extremely high demand, and the fact that it can be used for defense purposes is, I guess, worrying most people.

To be able to predict which way things will move at this point in time is kind of difficult. I think I would like to avoid making that prediction.

Is this problem faced by the entire industry, or is it just with our company?

No, it is faced by many people in the industry. Anybody that is producing preform would face it.

Anybody that is buying preform and drawing the preform would also face it because glass is not available for any kind of money. There are very few people who are able to get glass from outside, and only those that have signed on long-term contracts, where again the price is going crazy.

It is a problem that is being faced today. Now how it will pan out in 3 months, I'm not able to.

I hope it turns out for the better, but at this point in time, I'm not able to tell.

Sir, that we can understand. My last question, sir, on the order book on this side of things.

Can you throw some light on the order book we have?

The order book, like I said, there is one major contract which will come up for renewal in I think end of June. I don't see why we should not be able to renew it because we've been their suppliers for the last 8 years.

Product-wise, they are very happy with us, and quality-wise, they're very happy with us. I don't see why that should not repeat.

Beyond that, and that takes up about slightly more than half of the capacity. The balance is sold to other customers.

In terms of volume, I don't see why we should not do something similar or better than last year.

The size of the order book, sir?

I don't have that number in front of me, but I am quite comfortable with saying that it should be better than last year.

All right. Thank you, sir.

Thank you. Thank you for all your good wishes, and thanks for participating in today's meet.

Thank you.