Ladies and gentlemen, a very good morning to all of you. It's my first annual investor call after taking over as Chairman of the company also.

I'm addressing all of you as we close a record year, record profits 122-odd crores. Volume has been the highest, 225,000 tonnes, which was our budget.

Also, we are poised for better times ahead. In the last year, interesting things have happened.

One, of course, in the last quarter with the Iran-U.S. war, raw materials has shot up in prices as well as gas disruption was a concern.

Luckily, for us, there was no disruption of gas, though the cost of gas has gone up substantially. I must say the government has handled the overall situation pretty well, that whatever disruption in LPG, which was there for us and for some other commodities, the disruptions were there, but they've not caused major chaos.

On our capex, reheating furnace was commissioned in March. It will improve our rolling capacity to 270,000 tonnes of finished product.

I hope as we get close to 270,000 tonnes, we might find ways to tweak it further to increase it a bit further. New NDT line is in progress.

New peeling line is in progress. We are trying to see if we can increase our overall melting production beyond 3 lakh tonnes to maybe 3,60,000 tonnes.

Our team has come out with a plan to do that. We will soon be applying for environmental approval, which is not sure that we'll get, but if we get that environmental approval, we'll increase the production in this plant.

The solar plant was commissioned also in this quarter. We will be getting 9 crore units of power per year.

A new section of 210 by 210 has also been introduced. Now, what does this new section mean?

That with this new section, our productivity of our concast goes up, which was a bottleneck and which is why we are more confident of increasing production. Second, it improves the quality of our product, our rework will come down.

First rejection of some of the critical parts, especially our bigger dia products, will come down, which will improve throughput as well as reduce some cost. Also, we've increased the heat size from 37 tonnes to 40 tonnes.

These will also help in improving productivity as well as reduce costs yield the line. Overall, I think we are on track.

In the next 2 years, I think we are getting more and more confident that we'll be raising the guidance further. This year, our guidance is now up from last year, which is ₹8,000 to ₹11,000 a tonne EBITDA.

From 2 years from now, I think we're confident now that this range can be increased further to 9 to 12. We are seeing better times ahead as we move ahead.

A couple of other interesting things. I think our new steel plant planning is going on full swing.

We seem to be on track that we will start our plant in July 2029 as of now. Our forging plant also a lot of equipment has been ordered.

We seem to be in track in commissioning the plant in end third quarter of next year. Jan-March of '28, we hope to start the production from the forging line.

We have also very soon start planning further expansion of the forging line. As well as strategically now, we are looking at a newer direction.

With the new steel plant, we will have a capacity of 5 to 600,000 tonnes. I think we had announced 500,000 tonnes, but gradually looking after talking to manufacturers, we are able to see maybe we'll be able to reach 600,000 tonnes.

With 600,000 tonnes there and 300,000 tonnes here, we will have almost 900,000 tonnes of steel. Now, this is the time for us to start diversifying our special steels portfolio into non-automotive steels also.

We have taken a strategic view that over the next 10 years, we will be about 30% non-automotive steel, 70% will be automotive steel. Non-automotive steel has several categories, and we will do deep dive into them as we go along in this year and next year.

There is railways, there is oil and gas, there is bearings, there is windmill shafts, ship shafts, and so on. Then there is also a newer area, which is more sophisticated, of advanced alloys and advanced materials, where we will start looking at aerospace, defense, very special steels for nuclear, dies, die steels.

Those are other areas which will go into the more super specialized range. These are all the next 3 to 5 years, you will see more planning and more thrust in that area.

Also, we're going to soon doing internal organization structure. We'd be moving into divisions.

We'll be having a forging division, where one of the senior Japanese people from Aichi will come in here. He will be posted here.

The President of the Forging division would be a Japanese gentleman from Aichi. We will have here now looking for a President of the Automotive Steel division.

Then we'll structure a separate Non-Automotive Steel division. All this in next 3 to 5 years.

Which will again enable the company to grow further, look for further alliances and joint venture partners into more specialized areas. I think more and more of my time is now going to go into developing these strategies, these relationships, and making the company stronger and serving what the country needs today.

To just give an example, tool and die steels, there's about 1,000 crores which gets imported into the country every year. The customers are the same.

Most of the die steel customers, all are our forging companies who are our customers. Each one that we talk to says it's a big headache importing these steels from Europe or from Japan or from Korea.

There is a big opportunity in those areas also. We have not decided on any one, but I'm just saying these are the areas of opportunities opening up for us as this plant is becoming saturated.

As a beginning, we're going to start with ingot casting in this plant. We'll start in a small way, and then we will be increasing our ingot casting.

Now, ingot casting is a different method of steelmaking. Melting is the same, it's just the casting.

We have continuous casting, which really is mass market, it goes into automotive space. Ingot casting will be higher alloys and limited volume that we will be moving into.

The specialized products will require this ingot casting much bigger diameter products, which will maybe you may just forge it and it may be sold straight into forging companies rather than the whole process of rolling after that. I'm just sharing broad outline with you today that we've reached now a stage where we can think of all these newer areas.

We are very clear, we will remain only in the areas of special steels and automotive forgings. More and more, our vision now is to see ourselves as a supermarket of special steels.

This is a new term that we have started thinking about it in the last couple of months. I think in today's annual call is the first time I'm announcing this to our shareholder community that we will try to be a supermarket, but we are very clear, we will remain only in the areas of special steels.

Of course, once we get into specialized alloys for defense and aerospace, then adjacencies come up where we can gradually in a slow process over next 5 to 10 years move into other alloys also. That all will be the job of the next generation of management after me.

We will lay the foundation strong company which can then grow into separate adjacencies with separate JV partners as we go along. Overall, seeing the confidence in the future, your Board decided to recommend a dividend of ₹3.5 a share.

Frankly, I had gone into the meeting with the mind of ₹3 a share, but seeing the results and seeing our plans and discussions, the Board decided that these kind of plans and the confidence the entire Board has in the management and the company, then we all decided at ₹3.5 a share. One more thing, last year, the important part was Aichi increased their shareholding to 24.9%, which is a statement of tremendous confidence from their side also.

They're very happy with the partnership, and they want to see a bigger play in India as we go along. Thank you.

This has been my longest opening comments so far. Singla, The figures are already uploaded, we can open, I think, to Q&A now.

Hello?

Yes, Saket, please go ahead.

Namaskar Jain Sahab, and thank you for the opening remarks, elaborating your plans ahead. Sir, now what should we look forward in terms of our ramp-up in volume of rolled product?

I think so with the commissioning and the annealing of the new line, with I think so we closed this year at sub 230 levels. What kind of

225? Yes,

225. Going forward?

Yes.

225 we closed this year last year. This year we like about to cross 250, maybe 255 we will target, but let's say for your calculations keep 250 in mind.

250 is the tellable number of rolled products?

Yes, 250,000 tonnes, yeah.

Sir, your line is muffled.

250,000 tonnes for this year, you should please keep that figure in mind, though we will try to target to sell a bit more, but we will see as we go along.

Okay. Sir, then you have also spoken about our Kocks block commencement and then the efficiency and all kicking in.

Post factoring that also, we will keep our EBITDA per tonne trajectory in that vicinity of 8,500 to 11,000 only?

Or that was a conservative Our range earlier was 7 to 10. From this year, we are increasing the range to 8 to 11.

We said 2 years later, we would like to increase the range to 9 to 12.

Okay.

We are trending upwards. That's what we are saying that we are gradually going to be trending upwards.

Sir, this year we did average of 8,500-plus. Even with all the vagaries of the market, we were able to post 8,000

Saket, can you come back in the queue because there'll be other people? I'll address your question later, this one.

I'll do that, sir. Your line is still muffled, sir.

That could be corrected.

Oh, I'm so sorry. Am I more audible now?

Okay. Sorry.

My apologies for that.

Good morning, sir, and thank you for the opportunity.

Sana, please go ahead.

Sir, what is our current capacity usage and how much can we see improvement in the next year?

Our current capacity, we actually sold full because our rolling mill capacity was close to 180,000 tonnes. We have done a lot of outsourced rolling and therefore managed to sell 225,000 tonnes.

In the year '26-'27, our rolling capacity is 270,000 tonnes. We hope to sell about 250 to 200 hope is 255, but for your calculations keep 250,000 tonnes.

250. Sir.

Sir, one more question I have. Are we expecting any changes in our product mix going forward?

Not this year, but this year, we'll see the beginning, just the tiny beginning, tiny shoots. As I said, we will start ingot casting in a small way.

That's the change that you will see, and we'll just be selling ingot products. Then gradually, as we learn and as we improve on this, we'll be improving the product mix.

From next year, you'll see small changes, but really the impact that you will see will not be enough. Impact will take about 5 years for the outside world to see the impact.

By then, the volume of the new plant would have come in. Again, you will not see an impact in terms of proportions.

Sir. All right.

For the foreseeable future, please assume similar product mix of automotive steels.

Okay. We can consider it similar one for the next 5 years, and after 5 years, we can see a good number.

You'll start seeing changing, yes. There will be, again, initially, when the new plant commissions, there'll be a small dip in the kind of products we are making because we'll be ramping up volume in the new plant.

Therefore, we will be shifting to some commodity products to build up volume. The product mix will be a bit changed, and then again, it will remain similar, then deteriorate a bit, and then again start improving from 5 years from now.

And 7 years from now, you should start seeing a change. I know it's a little longer-term perspective than most investors on this call.

To see changes in the stuff that I was talking about, the futuristic businesses, it will take 5 to 7 years, we'll start making some impact. For a change from investors to see, maybe 7 years onwards.

Sir. Thank you so much and all the very best.

Yeah. Thank you.

Yes. Hello.

Good morning. I just had a clarification question on the previous participant's question.

I just wanted to understand when you mentioned that the new capacity that will commission, are you referring to the 500,000-tonne capacity of billet production?

Correct.

Okay. I just wanted to understand when are we expecting that to commission?

We are expecting that to commission by July '29.

Okay. Okay.

Okay. What is the growth trajectory that you can see going forward?

I'm sorry, can you speak a little louder? I couldn't hear that.

Yes, what is the growth trajectory that we see going forward? Even with the Aichi increasing their stake and now with all the capex that we are doing.

If you can give us a growth CAGR, that would be very helpful, sir.

The first target is to reach the full 270 or 280,000 tonnes that we can make in this plant because our license is 300,000 tonnes of steelmaking. If we get a government license to increase the capacity, which is a 50-50 chance we get it, then there is scope to grow further.

As of now, please target and keep in mind 270,000 tonnes for the next 3 years. Then after that, there'll be a sudden jump when the new plant commissions.

Okay. For this license, have you already applied for the license?

By when can we expect to get some results on this?

We will be applying in 2 months' time. We have some pending environmental work to be done before that, which will be done maybe in May itself.

June, we will apply. We should know before March of next year.

Okay. Got it.

Got it. Thank you so much and all the best.

Please go ahead. Sorry, may I just say one more comment?

That normally, if a 20% increase in capacity is applied for, you don't need a public hearing. Environmental approval normally people say, what I hear from consultants and other people, is normally not that difficult to get.

We are reasonably confident that we will get it. Why I'm still saying 50-50 is because Ludhiana still is in the critically polluted zone.

Separately, from our CSR activity, I am talking to think tanks trying to see how to work on getting Ludhiana out of the critically polluted zone. That's a separate topic, but that's just as an aside.

Good morning, sir, and thank you for the opportunity. A couple of questions

from my end. Yes, Shlok, go ahead.

First thing, on the commissioning of this solar power, which you indicate that will be generating almost 9 crores of unit in financial '28, and with the installation of reheating furnace, what sorts of savings one can see in FY28?

We have not shared those figures, but by the very fact that we are saying our EBITDA range, which has been stuck at 7 to 10 for some time, will go up to 8 to 11 this year and then 2 years from now 9 to 12. Maybe next year itself, we'll feel more confident if the oil prices is correct.

See, we're also facing a possible recession in global economy. A lot depends on what you see trends, but we are now, for the first time, we are saying that 2 years from now we should be getting 9 to 12.

Earlier, these figures were just aspirational figures.

Now

we're saying that we are now quite confident that we should be able to up the range. Yes, those cost savings, volume increase, all those things are being taken into account.

From 8 to 11 to 9 to 12 right now, which more looks like a reality rather than aspiration. Is it going to come with the more of a cost efficiency or it would be driven by the change in the product mix?

As I answered in the earlier question, the product mix, I don't see a much of a change just now. It is volume, cost-cutting, process improvement.

Even this year, though we've had record profits, there are areas we saw that we could have improved further. Some of you have read my annual report know that I'm a trekker.

When I go trekking and you cross a mountain, as you reach that top, then you suddenly see newer vistas which were not visible earlier.

True.

As you reach a particular level, then you find newer areas which you didn't see earlier. Then you kick yourself and say, "How come we didn't see it earlier?"

Then I have a famous saying for last 30 years, "Jab jaage tab savera." I don't ask people a question, "Why didn't you see it?

Why didn't you think of it earlier?" If you think of it today, great, implement it now.

Right. Agreed.

Now one question on your forging plant, which is expected to commission on third quarter of financial '28. What sorts of capex have we spent and how much it is left?

Secondly, what sorts of ROC one can assume only on the forging unit?

As of now, not much has been spent. We have, of course, bought the land, and some initial LCs have started getting opened.

Really not much has been spent on that. Maybe about 50 crores?

80 crores have been spent.

How much we'll be spending in the next 9 months?

Total project cost was 475 crores plus our NDT line is also in that same premises. Overall, the budgeted investment is more than 500 crores.

The NDT part was already part of the earlier approved VSSL steel expansion of 350 crores. Let's not double count that.

For the forging project, 475 crores was a budgeted expenditure. The way we are going ahead, it looks like we may not be spending that much.

We'll be spending less than that. We'll have a better estimate in 6 months' time of what will be the actual expenditure.

Looks like we'll be clearly less than 475, which we had budgeted.

The plant is expected to commission on third quarter of FY28?

Let's say will be commissioned, fourth quarter finally, we'll start seeing some performance. Really, '28-'29 is the first year of performance that you will get realistically.

In terms of the payback or the IRR, is there any estimate that's

Those things we don't disclose project by project. One line as you can make out, will not be sufficient.

We will soon be adding a second line and a third line. We have plans to add at least three lines of forging.

That's when it'll be completed, and we'll see by when we complete this forging project. The first line will start operations in the fourth quarter of '27-'28.

An

incremental capex for the new line assuming the same capacity will be lower?

Will be lower, will be clearly lower.

It will be of the same capacity, right, which we are phase one? Again,

those things we will evolve as we go along. As we are entering a new business, those things will take shape as we go along.

Okay. That's quite helpful, Mr.

Jain. Thank you, and all the best.

Thank you.

Hi, good morning, sir. Sir, congratulations on a great set of numbers.

Sir, I have a few questions. Firstly, has the land acquisition been completed for the new greenfield plant?

We are at the last stages. It should happen within May, we should be closing it.

Okay. Sir, my second question is related to the capex for FY27 and '28 with the forging plant and also with the new greenfield plant and potentially expanding capacity of melt shop at the existing site.

What can be the capex for FY27 and '28?

Singla, '27-'28 capex, huh?

'27-'28, for that steel plant and forging plant, we will be incurring maximum capital expenditure in that year. We don't have that calculation, but a ballpark figure will be more than 700 to 800 crores.

In the current year?

No, '27-'28 you are saying.

No,

in the current year and

current year and next year, I'm asking.

Okay. In current year, it will be very less expenditure, only on procurement of land and some development work.

The major capex will happen in '27-'28 only.

We're also having replacement items as our old peeling line needs replacement. We are adding to our testing line and so on.

Roughly about 100-odd crores of normal capex at replacement and quality updations and so on, those will be done in the next 2 years for normal work for this plant.

Okay. So, 100 crores this year and 700 to 800 crores next year?

For the expansions and for the existing plant, about 100 about 100 crores more.

If we get

the environmental approval, then we will take maybe another 80 to 100 crores.

Okay. Got it.

Again, these are very, very ballpark rough figures. Once those things come up and then we will take clear decisions and then will be announced at that stage.

Sure. Got it.

Sir, just one question on the brownfield expansion, the melting shop, which you are planning to take from 300 to 360 ktpa. Once we get the approval from EC, what will be the timeline for this expansion to get completed?

If things work out well, our target will be, again, these are very rough ideas,

because the

delivery of some of this equipment is long delivery. We would expect sometime in later part of calendar year '27.

Okay. EC, you mentioned in 6 to 9 months, you can get the EC clearance?

Yeah. Yes.

We are discussing with the suppliers how to shorten that time. Otherwise, these equipment take a year and a half for delivery.

We are talking to suppliers and we have good relation, and we'll figure out how we can get it earlier.

Sure. Thank you, sir.

I have a few questions. I'll join back in the queue.

Thank you.

Yeah. Hi, a very good morning, and thank you so much for the opportunity.

Most of my questions are more or less answered. I just have a couple of follow-ups.

First one being, sir, you just guided for EBITDA per tonne to be around 8,000 to 11,000 and further going ahead towards 9 to 12,000 on a per tonne basis. My question comes, what sort of realization assumptions are we building out over here?

Is it the current spot prices or the average for FY26?

No. It's consistently true whatever you take.

If you take the average of last year, even that is fine. You take the current, even that is fine.

Because in auto industry, we don't work as a commodity pricing. Pricing will change based on scrap going up.

Our spreads are more or less protected, a little bit here and there it changes, which is why we keep a range in our EBITDA. Which is why when the commodity steels have gone up substantially, alloy steel prices will not rise up to that extent.

When commodity steel prices fall, then alloy steel prices don't fall that dramatically either. As I said in my opening remarks, that the scrap prices have gone up and therefore, we are asking for a price increase from Q1, and we are likely to get those price increases in Q1.

Those discussions are ongoing

just now. Got it.

Basically, in a nutshell, it's much more cost-driven growth that we're coming out with along with some operating leverage also kicking in. Correct.

Which is why we always talk about spreads. We don't talk of actual selling price.

For example, the average selling price of steel was lower in the previous year in '25-'26 and '24-'25. Despite a higher volume, our sales are actually lower on a higher profit.

EBITDA margin looks much better than normal. Net profit margin looks much better than normal.

That's why I don't look at those figures. I always urge our investors, please look at EBITDA per tonne and volumes.

Yes. That is quite helpful.

For the greenfield plant, for the run-rate that you have given for the capex over the course of the next couple of years. Just tracking it again, we have sort of a 100 to 150 crores of maintenance capex and then incremental 400, 500 crores of growth capex.

Is that the correct understanding?

No. The figures are more.

What we will do is, I think these questions are coming up. We will have better calculations after next 3 months when we negotiate all the machines.

We'll have a much better idea. Once we have that, we'll update our presentation and post it on the company website.

Yeah.

Sure. That would be quite helpful.

Just one last question out over here. For the greenfield plant that we're targeting for July of 2029, what sort of ramp-up period do we expect to reach the peak capacity utilizations over there?

Very difficult to say that today because you are talking of 6, 7, 8 years into the future. Who knows what the market is going to be there then?

Now if I can hazard a guess and please take this with a very big pinch of salt. Attempt will be within 3 years to reach full capacity.

It could take 5 years. In fact, for all our budgeting, we've taken 5 to 6 years to reach full capacity utilization.

Got it, sir. That is actually helpful.

No worries on that.

Because again, we are not in commodity steels that you just put up a plant and then start producing and selling. The advantage in the new plant will be that our costs are going to be much lower than the existing plant.

Therefore, some of the commodity within the alloy steel, the commodity end of the business like tractors and trucks, which we normally stay out of, because of lower cost of steelmaking in the new plant, we may be able to access those markets, and therefore, we will try to ramp up earlier.

Got it. Sure.

Thank you so much and all the very best, sir.

Am I audible?

A little louder, please.

Can you hear me now?

Go ahead. We can barely hear you, but we can.

Okay. My question was on the exports.

If you look at our exports, it has remained in a single digit. Earlier when our guidance was to reach up to 20% of the exports by the end of FY27.

With the new capacity coming in, I would like to know how we are thinking about the exports going further. That's my

Yes, you're right that we had a guidance at that point in time. Exports are going to be a much lower proportion of our business.

We are seeing exports in the form of components increasing from India. More and more our attention is towards serving OEs from component exports from India, including from our new forging line.

We'll be targeting through some more vendors in India, some global companies coming in, who will use our forged products and machine them and export them. We'll be looking at that possibility.

We are talking to a couple of other global forging majors to expand capacity in India, that we will supply steel to them. We are talking to some global OEs who are wanting to source big quantities from India.

They will all be sourcing more and more of components from India. Europe is having a much higher cost of operation because of the gas cost, energy cost being high, wage costs also becoming higher, unavailability of young people to work in the night shifts and in hardcore manufacturing.

With an FTA, which they've signed with EU, they are expecting much bigger imports of components from India. In CBAM, which is there for steel imports into Europe, we stand very well placed in CBAM calculations.

Within a year or two, I think even components are going to come under CBAM. Once components come, some components already come in, some will come in in the next coming few years.

Because of green steel, our abilities in green steel, we will be able to take more and more advantage of this. Exports for us will be more and more indirect exports rather than direct exports.

Okay. Do we see a realization on the EBITDA better into this kind of exports?

It depends customer to customer and part to part. Clearly, for a customer, if you're in the luxury end, if you are able to serve a customer like BMW or Mercedes-Benz, the prices are normally a bit better.

In some cases, yes, prices are better. Understood.

Secondly, on the forging part, when we are building the capacity, which will come on-stream by the beginning of the same January '28. On the other side, the customer approvals or how long that will take for us to get [unclear]

I think it's a very valid point. We are strategizing because our partners, Aichi, are amongst the world leaders in the kind of forgings we're going to enter into.

We are talking to customers they can start supplying from Japan initially to get those approvals. Since Aichi is the partner here and Aichi people are going to be heading the forging.

Attempt will be to reduce the approval process and approval time.

Okay. On ballpark, what's our product validation or the process validation period for products like forging for us, any idea?

Very difficult to say. It will vary from customer to customer.

Some customers that we are talking to, these are just now talks because everyone says, "We haven't seen the product. We haven't seen the factory just now."

These are all talks. Hopefully, for a couple of customers we are talked to, we should be validated before our plant starts production.

We are integrating the [unclear] things.

Through our partners, because of our partners. Otherwise, it will be very difficult.

Because of our partners, Aichi, we should get better approval for some customers. For some customers like Maruti, they've very clearly said, "We will first see the factory in operation here, then start the validation process."

Understood. Is it fair to say that forging ramp-up will happen in FY28 or by the fag end of FY28?

No. '28-'29.

We very clearly said it's going to start operations in Jan to March of '28. Ramp-up will be '28-'29.

Understood. All right.

That's it from my side.

Hello?

Saket, welcome back.

Thank you, sir. Sir, just to take the chronology of events, for this financial year, we are modeling in or factoring in a 10% volume growth with a higher EBITDA range by ₹1,000.

Then how will the forging and the new steel plant commensurate to each other? Means if you could just explain the chronological event.

For this 10% volume will be flattened out for the coming 2 years. That means we will be reaching the peak for this year and even for the next financial year.

Is this understanding correct?

No. So, 250, 255,000 that we reach now, the next year will be 270 or 275.

We will get to see the exact numbers. Then we will target some outsourcing and so on.

We'll keep seeing that we are trying to grow, that we will not stop growth. To figure that out 2 years later, what kind of model we will have is difficult to say just now.

For your calculations, please assume static at 270 or 275. Then if we get this environmental approval, then, yes, then this phase will increase.

It's very difficult to commit today. As far as existing plant is concerned, 270 is the figure you should take that we remain static at.

Then in '28-'29, we will start seeing results of the forging business, but it'll be a very small volume, really not see any impact. The new steel plant will get commissioned in '28-'29 also, July '29 is the target, and then you'll see volumes coming in towards the second half of '28-'29.

So, '29-'30, we will start seeing a better impact of the new plant.

Okay. The government clearance is for the existing melting shop of 3 lakh, and we are contemplating a 20% increase on the same?

No. Currently, we are producing less than 3 lakh tonnes.

Our first attempt is to quickly go to 3 lakh tonnes, which will happen next year.

The government clearance is for?

3 lakh tonnes. We'll be at full government capacity level.

Right. Sir, when we look at our plant and property closing balance for the financial year '26, it is closer to ₹585 crores.

That is a significant increase from the last year closing balance. If you could just give us understanding of the breakup of how the capex has been and

I think send a specific email to the CFO, this will be answered. Largely, we've had capex going on.

Our Kocks block was commissioned. Our reheating furnace was commissioned.

Some warehouses are being built. Land has been bought.

Those are the things which is there. As that we bought some land initially, where we started buying the land for the steel plant.

We are stuck at 50 crores, so that's one area we have for some possible expansion. Then we bought land and with a constructed shed for our new forging line.

This is all largely for the new capex for the new plants as well as the Kocks block and the reheating furnace.

Okay. Two more questions.

Firstly, on the incentive part, for the current financial year, what should we factor in for a quarterly run-rate in terms of the government subsidies, whether it is electricity or the other tax subsidies, if any, for the full year, if you could share that number? Also, for the new steel plant, does it fall under any government incentive of PLI benefits that we are going to accrue going ahead?

The new plant will not be under any PLI. However, it will be under the Punjab government subsidy scheme.

Again, we will have a similar set of subsidies of electricity duty as well as GST refunds and some capital subsidies, some on workers. There will be subsidies in the new plant also.

Singla, this year, what is the subsidy question?

Currently, we are getting two types of subsidies from the Punjab government. One is the electricity duty exemption and the second is the GST refund.

Electricity duty exemption will continue until August '29. GST refund incentive was for 7 years and will end on August '26.

Okay. For next financial year, Singla ji, what should be the number incentive dono mein add karke?

For next financial year, it will be close to 12 to 13 crores for both the incentives because electricity duty exemption will also come down because of the solar power commissioning. The total incentive will be close to 13 crores.

In this financial year.

In this current financial year, yes.

'26-'27. How much have we factored for financial year '26?

It is 24 crores.

It will be halved for the next financial year?

Yes.

Right. One more understanding, Jayant Sahab, and I'll join the queue.

In terms of the forging unit, the forging unit will serve the products from our this current facility and the new steel facility both or will it is just cater to the 5 lakh tonne new plant that we are contemplating?

No, it will start from here. Then for each product, the diameter, which is the right diameter, gradually

your line is muffled. Sir, your voice is muffled, sir.

We can't hear you.

new steel plant. Initially, it will come from this plant because that's what we have today.

Sir, will you repeat the same, sir? We could not hear you, sir.

I said all the volume will come from the existing steel plant to start with. Once the new steel plant gets established and the quality gets, then more and more of the volume for the current products that we are putting in will come from the new steel plant.

Okay. Lastly, sir, just

Good morning, sir. Sir, a couple of questions on the balance sheet front.

What are the plans of funding in terms of debt, equity, and internal accrual? That's one.

Also, do we have any figure in mind that we don't want to cross a certain debt-equity ratio that we won't be comfortable crossing?

Yes. At the peak, debt-equity, we will keep it below 0.75, total debt-equity.

We are comfortable at 0.5. There will be an equity infusion.

There'll be a further equity infusion sometime later part of next year. At that point in time, we'll see how we will fund that equity.

Clearly, our partners, Aichi, are ready to invest more. Vardhman Group has committed ₹3 to ₹400 crore, we will have that also.

At some stage, we might do a QIP or something for outside investors. Roughly, we see about a 1,200 crore of equity infusion, out of which 385 has already come in.

About 800 crores or so roughly equity and about a 1,200 crore of debt, which will be raised.

Right, sir. Okay.

Thank you very much, and wish you all the best.

Thank you.

Good morning, sir. Congratulations, the wonderful job you are doing for us for all of us.

Sir, my question has already been answered up to some extent. I want some clarification.

As you recently said that our capex equity will be 1,200 crore and debt will be 1,200 crore. What are the total expenditure capex you are thinking about?

It means just now it was 6,000 700 700 crores. How much capex you are plan planning up to '30?

The total capex that we have planned for the new steel plant is about 2,000 crores. For the forging project is about 475 crores, which has been announced.

We feel that capex would be a little lower than that. Then there is some internal capex, plus we will also start some replacement capex and normal capex.

Then as I said, we're going to start our process of ingot casting and then moving into specialized alloys. As those plans get formulated, there will be investments in electroslag refining, vacuum arc refining, vacuum induction melting.

All those areas, we have to study, but I'm saying that's the directional area where we'll be investing in those. Those have not been discussed fully, announced so planned fully.

In the next 1 year, we'll be finalizing those and announcing our plans in that area. Suffice it, it will be a smaller investment to start with.

We are a risk-averse group. When we enter into a newer area, we'll start with a smaller area, smaller investment, and then gradually build up.

As of now, the committed investment is about 2,600 crores.

Okay. All right, sir.

Sir, my only second question is, sir, how much after this all established capex as planned has already there is committed. Sir, what are your ROC you are keeping in mind?

Actually, you are always talk of some sort of target of ROC. What can we get some figure after '30?

After the plants are established and running towards full capacity utilization, EBITDA on capital employed, we hope to continue to be above 20%.

Sir. All right.

Thank you, sir.

This is a very, very futuristic figure because we're looking into the future. Yes, below 20%, then it doesn't make sense for us to continue investing.

Best wishes, sir. Thanks once again for your wonderful efforts you are doing.

Thank you.

Thank you, Anil ji.

Thank you for the opportunity. Sir, what will be the components that will be made in the forging plant?

What will be the capacity? If you can also give in terms of asset turns of the forging plant, it will be helpful.

See,

we are entering a new business, it's very difficult to give all those numbers. We are entering into the area of ring gears.

That's the area we are entering into. Each car uses one ring gear, so that's the potential volume for car manufacturing in India and export.

It's a superior method of making ring gears. It's not a new product.

It'll be replacing an existing product with which customers are already using with a far more efficient process. All customers we have talked to are very excited with the announcement of the project that we're bringing into the country.

Now Aichi is one of the world leaders in this method of gear making. That same know-how is going to come into India to VSSL.

As of now, as per their study, there really is no viable competition for this process of gear making as per Aichi's knowledge. We are still new in the area of forging, we are relying more and more on their knowledge and their confidence in this process.

They have nine lines of this product. We are putting in only one line just now.

Fine, sir. Understood.

Thank you. Thank you.

All the best.

Ladies and gentlemen, thank you so much for the interest that you've shown in our company today. Today, I did lay out some futuristic thinking.

Again, now as managements, our job is to look 5, 7, 10 years in the future, which may be longer than the horizon for some of you. I also see some of you on this call are HNIs and individual investors who may have a longer-term perspective also.

Our job is to show the direction in which we are going while maintaining existing performance. If the existing performance to be maintained is very, very important and continue to enhance and make the company stronger as we go ahead.

Thank you so much for your interest, and we look forward for your continued support. All the best.