Thank you. Good evening, everyone, and thank you for joining us on the Deepak Fertilisers Q4 and FY '26 earnings conference call.

Today, we have with us Mr. Sailesh Mehta, Chairman and MD of the company; Mr.

Subhash Anand, President and CFO; Mr. Tarun Sinha, President of the TAN business; and Mr.

Suparas Jain, Executive VP, Corporate Finance. We will begin the call with opening remarks from the management team, followed by an interactive Q&A session.

To begin, Mr. Sailesh Mehta will share views on the operating performance and the growth plans of the company, followed by Mr.

Subhash Anand, who shall take us through the financial performance. I now invite Mr.

Mehta to share his opening comments. Thank you, and over to you, sir.

Thank you. Is my voice clear?

Yes, sir.

Thank you. A very warm welcome, rather a hot welcome with this peak of summer, to everyone.

Thank you for joining us today. Our earnings presentation and press release were available on the stock exchanges and our website, and I do hope you have had an opportunity to review them.

As usual, what I will do is share some undercurrents and insights, and then, of course, the detailed financial analysis would be shared with by Subhash and the team. Of course, they are available for all question-answers also.

As we saw Q4 pan out, we also, like companies in India and globally, had to operate in a very challenging environment thanks to Mr. Trump.

We saw a sudden impact emerging from sudden shortage of LPG, and the refineries were also pushed hard to not reduce the supplies of LPG, and that impacted an LPG cut, which is propylene, which supports our IPA business. We also saw LNG cuts that impacted our fertilizer and chemical businesses because LNG vessels got stuck, as you're all aware.

Fertilizer prices went shooting through the roof, and we saw an inadequate and delayed subsidy coverage from the government. Somewhere we saw even skilled labor for our projects impacted by LPG shortage for cooking, besides a lot of them vanishing due to the West Bengal and other state elections.

We also saw China bringing an export ban on some of the critical products, and conversely, we also saw India bringing in a ban on exports of ammonium nitrate. Now, considering these multiple challenges, I think we have navigated fairly well.

As we see things panning out now, and the positive trends continuing over Q1, we are now seeing that there has been some respite we have got, thanks to the Petroleum Ministry providing us some help to source LPG propane. We're still having some challenges because they are indicated refineries which are far away from us, the landed costs are higher.

That is something we are navigating. On the LNG front, while there's been an improvement on the gas front, I'm really happy to share that our maiden cargo from our 15-year contract arrived just a few weeks back.

Frankly, I might share that any relationship, and such long-term relationship, is truly tested during a crisis. I'm truly happy and grateful to share that our Norwegian suppliers bent backwards to ensure that the LNG supplies don't get impacted, thanks to the war holdbacks and all.

Also, while Q4 saw a longish planned shutdown for our ammonia plant to also bring in some efficiencies and capacity improvements, and that brought in an impact of around ₹70 crores in Q4, but as we speak today, the plant is performing very well. We are seeing not only an improvement in capacities, but also efficiencies.

As we see now, we are seeing the real benefits emerging of our value chain, that is LNG to ammonia to the complete downstream, that is now gradually coming alive. As far as our crop nutrition business goes, we did try to push for even higher premiums so that some of these higher costs could be passed on.

Somewhere the subsidy support was not adequate to bridge this runaway raw material price hike. Also, as the government held the fertilizer prices, the urea and DAP prices, to the farmers in view of the state elections, it put a little lid on how much premium we could charge on our NPKs.

Yet, the quantum of premiums gives a very strong validation to us that the enriched specialty smart fertilizers that we have brought in have truly crossed the mindset of price boundaries in view of the superior value proposition that they gave in terms of better yields and better quality produce. I might also share that while we do hear about the El Niño impact likely to pull down the rains somewhat, we are still tracking for granular Skymet details and reports, since broadly we have gathered that the impact could possibly be lesser in our crop geographies, but we'll need to wait and see the granular weather reports to come up.

Now, while the project execution is going strong, we do have a little time realignment due to severe shortage of skilled contract manpower which we faced with various states going in for elections and suddenly there was a severe shortage with West Bengal, Tamil Nadu, and other elections, and also some impact that emerged because of lack of cooking LPG. Now we are again bounced back to full-fledged full-steam working.

On the other side, we completed the acquisition of an explosive unit and are now moving forward on our planned strategy from product to holistic solutions for our TAN and mining business. As we see the Gopalpur TAN facilities, we will be uniquely placed as we come into production because our TAN facilities will be based on stable and consistently available produced or imported ammonia, and not based on constraints of government surplus ammonia policies for urea ammonia plants.

Our Gopalpur facilities are advantageously placed in the midst of the key mining geographies in the East and that way would enjoy good freight advantages.

Is it better now?

Speaking from the handset.

Yeah. Our Gopalpur facilities are advantageously placed in the midst of the key mining geographies in the East...

Okay. My voice is clear, right?

As I was saying, as far as Gopalpur goes, that our TAN facilities at Gopalpur are going to be based on stable and consistently available produced or imported ammonia, and not based on the constraints of the government surplus ammonia policy for urea ammonia plants. Our Gopalpur facilities are advantageously placed in the midst of the key mining geographies in the East and would that way enjoy good freight advantages.

Having TAN facility in the West and East will give our customers a strong risk-mitigated supply consistency while allowing us to supply from the best freight economic zone. The other is having nine nitric acid plants, four ammonium nitrate plants, global best technologies, and 45 years of customer relationships.

These strengths obviously can't be easily replicated. Lastly, with our unique porous prills, the mining knowledge base, BMDs for the last-mile connectivity to the mines, we will enjoy unique selling propositions for the premium segments of the market.

All in all, as I see it, we are finding very strong validation on our strategies of, number one, the investments we have made in the value chain. Now it will pan out very clearly right from the 15-year LNG contract, the world-class ammonia plant, the downstream capacities that we have added in terms of fertilizer, acids, ammonium nitrate.

Last, but not the least, the very strong strategic drive that we have brought in from commodity to holistic solutions. All of these we are going to see unfolding in the next year, obviously supported with the larger tonnages coming out of the two projects.

This is broadly the way we see things panning out. I now would invite Subhash to share with you the financials and the logics, and, of course, help you on all clarifications and questions.

Subhash?

Thank you. Thank you, Mr.

Mehta, and good afternoon, everyone. Let me take you through the financial performance and highlight the key drivers across businesses.

At the consolidated level, we delivered revenue growth of around 12% for the full year with revenue at ₹11,506 crore. For the quarter, revenue stood at ₹3,011 crore, reflecting continued volume-led growth in mining chemical and crop nutrition, along with a sequential recovery in industrial chemical.

On profitability, our full-year EBITDA stood at ₹1,684 crore, while Q4 EBITDA came at ₹354 crore. If I step back and look at the full-year picture, it was a story of two halves.

In the first half, we saw a strong performance across businesses, supported by relatively favorable pricing and operating conditions. However, the second half was more subdued.

This was largely due to sharp increase in input costs in fertilizer business, particularly phos acid and sulfur, whereas the pass-through to customer and the corresponding subsidy support lagged the cost escalation. At the same time, we also saw pricing pressure in chemical segments, specially in IPA, which further weighed on margin during the second half.

It is also important to note that Q4 includes the impact of planned ammonia shutdown with a one-off effect of around ₹75 crore. Adjusting to this, the underlying operating trend is more stable and we are beginning to see early sign of sequential movement.

At the PAT level, full-year profit stood at ₹739 crore. After adjusting the one-time tax credit in previous year, the decline is around 18%, largely driven by margin compression, partly offset by lower finance cost.

Let me now briefly touch upon the performance across businesses. In mining chemical, the business delivered a strong recovery during the quarter after a softer Q3.

Volume were up 12% Y-o-Y basis and 27% sequentially, with a full-year growth of around 11%. The B2C segment continued to scale well, now contributes around 16% of the revenue compared to 13% last year.

This is an important structural shift improving both realization and customer engagement and will remain a key drivers going forward. In industrial chemical, performance remained mixed, but with improving trend, nitric acid volume showed healthy growth during the year, while IPA performance were impacted by weak price and lately constraint in RGP availability, which continued to limit volumes.

However, now we are seeing an early sign of recovery in both TAN and industrial chemical segment with improving spread supported by tighter global supply conditions and lower import. In crop nutrition, the quarter was challenging, the business impacted by lower farm-gate prices, elevated channel inventory, and sharp increase in input cost.

Importantly, there was also a lag in subsidy realignment, which affected margins during the period. Despite this, Croptek delivered resilient performance and the overall product mix continue to improve.

Specialty and Croptek now contributes around 33% of segment revenue, up from 30% previous year, which is a very important structural lever for improving margins over time. On the balance sheet, capex during the year around ₹1,569 crore as we move closer to the completion of our key growth project.

As a result, the net debt-to-EBITDA stood at 4,800- the net debt stood at ₹4,824 crore and net debt-to-EBITDA is around 2.86x. This reflects the final phase of our investment cycle and is aligned with the capacity creation under way.

On a project progress, both our key projects are now in advanced stage. Gopalpur TAN project is around 95% complete; Dahej nitric acid project is around 86% complete.

The cumulative CWIP on both the project is around ₹3,050 crore. However, if we see a total spend including GST and advances is total cumulative spent is around ₹3,800 crore.

Commissioning is expected in Q2 FY '27 and both projects remain within the approved capex envelope. These assets will significantly enhance our capacity, cost competitiveness, and operating leverage going forward.

Another key milestone during the period has been commencement of supply under our long-term LNG contract with Equinor, with the first shipment already received in May. This strengthens our ammonia value chain by improving supply security, cost visibility, and integration advantage, which will support margin stability across downstream businesses.

In addition, we have completed the acquisition at DMSL, which strengthens our mining chemical platforms and enhance our ability to deliver integrated, value-added solutions to customer. Let me now summarize.

We have delivered strong revenue growth despite operating in challenging environment. Margins were impacted by input cost inflation, pricing pressure, certain one-off factors, but we are now beginning to see clear sign of improvement.

Going forward, we expect quality of earning to improve, supported by three key levers: tightening global supply conditions, which are helping to improve spreads; better cost visibility and stability from our long-term gas arrangement; and a stronger business mix with higher contribution from specialty product and B2C segment. In addition, the ramp-up of new capacities in the coming quarters will provide further support to growth and operating leverage.

Overall, with these levers coming into play, we are confident of progressively stronger performance in the coming period. Thank you.

We would now be happy to take your questions.

Hello. Thank you for taking my question, sir.

First question is on the TAN volume side. This quarter we did I think one of the highest volume on the quarterly basis.

Although in last two quarter there was some subdued numbers. Is this a new run rate for us or is there some backlog sales also in this quarter, which lead to higher volume?

Thanks for the question. This is Tarun Sinha speaking.

The reason for slightly better performance in Q4 on volume terms compared to Q3 is demand strengthening. As as we get to the last quarter of the financial year in India, all the mining companies, particularly, have their targets of mineral production and rock production to achieve.

That provides the impetus to the explosives demand, which then leads into the TAN volume. That would be the primary reason, I would say, for better volumes in Q4.

This trend is likely to continue, although we are getting into a soft season, as you know. We're getting into monsoon, Q2 is cyclically and seasonally weaker in terms of demand.

We don't see any long-term demand destruction for any reason.

Currently, the volume what you're seeing is from our existing capacity. Once Gopalpur come in, then definitely the new normal volume will be much higher where we are currently.

Got it. Got it, sir.

Sir, in terms of realization, if you could highlight that how much benefit we have seen in this quarter and how much is expected to be coming in the Q1, as I believe still considering the kind of volume, revenue is slightly lower as what we have seen the kind of prices prevailing in the market?

No, let me start and then Tarun will add into this. Yes, and as you can see on the international market, the prices of FG ammonium nitrate are firming up, primarily led by disturbance or distractions because of war in Russia-Ukraine.

Some of the export got banned, and some of the volume got I'll say, since the import quantity in country got restricted. On top of that, FG ammonium nitrate prices started getting firmer.

That is getting reflected on our realization or is visible at this point of time.

Basically, what sort of realization would be there prevailing currently, if at all you can disclose?

No, in fact, it's a published number. I'll say if you're looking at FG ammonium nitrate prices, it's a published number and every month prices are going up.

March FG ammonium nitrate international FOB was somewhere around $300 somewhere around $450. It has further firmed up during this quarter.

Prices are firming up, although most of the time domestic prices broadly go in line with international prices, but correlation is not always one-on-one, but broadly trend remains similar, I call it.

Got it. Got it.

Secondly, sir, on the Equinor supply side, as we have received the shipment, just wanted to understand that kind of how long we are secured in terms of natural gas supply from this shipment?

Now, we are fully secure. When I say fully secure, the way we have contracted, we have a minimum take-and-pay contract currently with our existing local supplier.

On top of that, we have got now 15-year long supply. We don't see actually any shortage of gas at this point of time, and not just for next couple of months.

We have a few more shipment parcel already lined up in this year. It's not the first shipment and it's not the last shipment.

With a gap of few months, we are getting a new parcel. We are comfortably placed in terms of gas supplies concern.

Got it. Got it, sir.

One last question before I rejoin in the queue. From the nitric acid side, could you throw some color on specialty-grade nitric acid products that we are working on and how we are progressing and what kind of opportunity we have in this?

We are working on I'll call it some of the special customer-grade nitric acid product. They are in early stage this point of time, most of them in I say commercial trials and stage, not yet fully commercialized.

In terms of contribution, very, very small, but definitely they are the one which, as a team, we are focused and we are trying to take it to a commercial stage and then its ramp-up can happen. Currently, it's too early for on those product to contribute meaningful in our overall portfolio.

Good evening, sir. Am I audible?

Yeah. Yes,

yes, Shubham.

Sir, for acetone or IPA prices, what are our expectations, let's say, for next 6 months and what could be the driving factors for the price recovery, in your opinion?

Sorry, your voice is not very clear, if you can repeat the question.

Sir, for acetone or IPA prices, what are our expectations for next 6 months and what could be the driving factors for the price recovery, in your opinion?

Okay. Now, if you are asking current IPA prices, it's already way, way high.

The reason for that is the polypropylene is not available, or the government restriction because of LPG shortage. The prices have moved up.

Is IPA available? Limited quantity of IPA available at this point of time because of RGP limited availability.

Will the price will remain elevated for some time? Yes, price will remain elevated for some time before the situation becomes normal and then we'll have to see what will be the normal IPA prices once things go back.

Will it come back to a similar level? Unlikely, but the new normal is expected post that.

Okay. Sir, for TAN new plant, what are the capacity utilization numbers are we expecting for the full year FY '27?

Okay. The way things looks like, and since we are in TAN business and operating across various geographies this point of time on TAN, we don't expect us will take much longer time to ramp up and reach to a I'll say, good capacity utilization level.

We expect by end of this year, we should be at least touching 90% to 95% utilization. It will be a gradual uptick, but yes, we should be able to reach there.

Okay. Thank you.

Thank you.

Hello, sir. Am I audible?

Yes, Kushal.

Thank you. My first question is in terms of percentage of HDAN and LDAN that we are going to produce from Gopalpur facility and our current facility.

It is in the light of the fact that we are oversupplied as far as HDAN is concerned, and also as an investor rose a question in previous quarterly call. As far as LDAN is concerned, I think we are undersupplied, and please confirm that assumption.

Thank you for the question. Again, this is Tarun Sinha answering this question.

One of the benefits we have across our TAN plants, whichever location you look at, is all our TAN plants are fully fungible in terms of the product mix, which means all plants, whether three production lines in Taloja, one in Srikakulam, and the new one coming up in Gopalpur, they can produce any kind of product mix in solid and liquid form, and within solid, any mix between high density and low density. This benefit is passed on to the market because we produce to the market needs.

It is not an inward or an internal decision that this is the ratio of the products that we will produce in different plants. We are here for customers and the market needs.

We keep changing gears in terms of the product mix as and when the market needs change. That's how we look at it.

That's how we plan things going forward. There is no particular number or ratio anyone can give at any point in time in terms of the product mix.

Thank you. My second question is on the lines of that we acquired an explosive manufacturer.

Could you please tell the long-term strategy of the company with respect to that particular explosive manufacturer?

This acquisition, as our Chairman mentioned in his opening speech also, is consistent with, and a very big enabler to, the transformation strategy of DMSL, which is the mining services entity of the group, in the sense that the business model that we are evolving in DMSL is that of being able to provide the productivity improvements in the mines and the quarries and the infrastructure projects. Simple definition of productivity improvement is cost of mineral extraction, cost of rock extraction.

How can we impact that through a solution? For that, we need full range of products under our control.

That's one of the things we achieved from this acquisition. As we build upon this journey of being able to have a full range of products to take it to the mines and end users to provide those solutions.

That's the strategic fit of this acquisition in the overall transformation journey of DMSL from being a traditionally AN producer and supplier to a holistic mining solutions provider.

Thanks. That were all my questions.

Thank you, management, for answering them.

Hello. Am I audible?

Yes.

Yeah. My first question is on margins.

How should we look at chemical margins because of backward integration benefits and this gas contract kicking in?

Okay. If you're looking total, I'll say, segment as a chemical, then yes, the margin improvement will happen because Equinor contracts do give us benefit in terms of our raw input cost.

However, the way we look in the business, each business is being seen separately based on IPP transfer pricing, not based on cost-plus. Each business stand on its own will show the profitability.

Equinor gas contract benefit will finally flow into our ammonia business, which is PCL. If you're looking holistically, the margin improvement is certain and that will get reflected in our consolidated chemical portfolio.

Any quantification would help, if you can?

No, that's the information you'll able to see once we come up with next quarter result. Partial reflection will be visible there.

Okay. My second question is on a cash flow.

Receivables and inventory days have gone up significantly during the year, how should we look at that?

Okay. This is basically, as Chairman also spoke, fertilizer business has gone soft.

I'll say, towards the end of rabi, we have seen uneven rain and then farmers getting impacted. Currently, in the trade channel inventory is slightly higher.

That's what is leading to higher inventory as well as receivable in our fertilizer business. Now reaching to kharif season, the actual pull is going to start from anytime now we have reached to a stage.

This is a temporary build-up for our kharif season. Maybe next month or two will back to normal and this elevated working capital will not be there.

Okay. If you can give us a capex guidance for FY '27 and possibly '28?

FY '27

is a '27 definitely capex continues to be because we have two ongoing projects which need to get completed, both Gopalpur and Dahej. There is a capex spending.

I already share overall project capex for that is around ₹4,650 and currently total capex spent is, including GST and advances, is around ₹3,800 crore. There's almost ₹800 to ₹1,000 crore capex spending, including maintenance.

This year will be an elevated capex. Next year onward, we should back to a normal capex because our current phase of investment will coming to an end and before the next phase start, it will be a normal maintenance capex and that should be in line with what you have seen in last couple of years, not significantly different.

Okay. Thank you so much.

Hi, sir. Thanks for taking my question.

Most of my questions have been answered. Just a couple of questions.

One, on the demerger front, any expected timelines? Are we expecting to do it this year?

No, not immediately. In fact, we yet to take a call in terms of form and shape and timing of subsidiary listing and demerger, or a listing, I call it, not demerger, how and when it has to happen.

We'll come back once we have more clarity, but yes, we are committed and we'll walk that path.

Sure. Sir, the second question, in the opening remarks, you mentioned that we have adequate supply tied down for ammonia for Gopalpur.

If you could probably give us some details on where this supply is coming from? How have you tied up the capacity?

That would be helpful.

Okay. Now, a couple of things.

When we say ammonia, currently, if you see, we ourselves produce almost 500,000-plus ammonia from PCL. We also trade in ammonia.

A large quantity of ammonia is being traded by us, which means we import and we sell. We do have an expertise of ammonia.

That's what we claim, I call it, or we can claim, we are in this business for long. I say there's no disconnect in terms of we saying ammonia has been tied up.

We have a contract in place or we know from where the source is in place. Since we are already in importing and selling ammonia, for us, some more additional quantity need to buy and supply into that plant.

That's not a challenge for us, and that's what gives us a confidence we are ready for Gopalpur ammonia supply.

That's great to hear, sir. Going by your guidance, I'm assuming there is no straight-of-the-formos risk for procurement of ammonia.

Just to add to that, do we have a long-term contract for ammonia as well or is just being traded on spot?

This point of time, long-term contract, no, I call it. We have a contract with not one, but number of suppliers, and that supply is continuous supply.

It's not we buy one-off. Every month we continue to buy.

That contract holds good. Yes, once we reach near to the formal, if we feel there's a need for long-term contract, we are ready and that can be done.

There's no showstopper for that.

Okay. Thanks for answering all my questions, sir.

Thanks for taking my question. My first question was on the Chardham Chemicals that we have acquired.

We have paid around ₹120-odd crores for 100% stake. Now, can management just walk me through in terms of the valuation break-up, what are we paying for it exactly?

Is it the licenses, the assets, technology, order book? Also, if you can give some guidance as to when this particular stake will get operational, and what sort of revenue and EBITDA we can see for the next 1 or 2 years?

Thank you. A lot of questions in a single question.

Tarun Sinha again here. In terms of the valuation, without getting into the numbers and the break-up, you're right in terms of the overall number, but what it is made up of is it's the value of the land, it is the value of the licenses, it is the value of some plants and equipment, it is the value of the location of the facility, which is the proximity to the market, and last, but not the least, it's the get-to-market speed through this acquisition, compared to if we were to put up a greenfield site.

All these factors have been taken into consideration for the valuation, and that's the number you talked about. That's the answer to the first part of your question.

In terms of how are we going to set it up, our plan is to bring this facility to Deepak standards. There will be a project team, which is going to be formed very soon, and they will work on the upgradation of the facility.

Also, we will add a number of new plants to this facility to capitalize on the license capacity that we have invested in. Then once we are ready with all of this, there will be a point in time we will update all of you when we are ready to roll the products out in the market.

Again, these products will go out in the market not as products, not as commodities, but they will go in the form of holistic solutions, which is what I was talking earlier. These products will be supplied in a way, and provided to the mines and infrastructure segments in a way, that the products and associated solutions are able to improve the cost of rock and mineral extraction of the end consumers.

That's the business model, and that's what this investment is aimed to achieve for us.

That's a great understanding that you have given. Lastly, on the CCDs that we have issued for DMSL, that ₹800 crores.

Now, I just want to understand who holds these CCDs, is it some third party or is it some promoter or related entity? Also, I just want to understand as to what is the conversion price, the ratios, and what sort of trigger terms that we have finalized for that?

Because what I want to understand is what is our stake eventually if such conversion happens? Now,

the CCD was issued last year in quarter one, actually. That CCD was issued as a mix of third party as well as promoter entity participated in that.

The split was ₹500 crore was unsubscribed by third party and ₹300 crore by promoter entity. Since they are CCD, it has a fixed conversion ratio.

It has a fixed conversion ratio. The number of shares are fixed this point of time because this is how the CCD can be structured.

Issuance is post roughly around 30 months when the conversion get due. It's just 12 months so far, we still have time before the issuance gets converted.

Okay. That's it from my end.

Thanks a lot.

Thank you.

Hi. Am I audible?

Yeah. Thank you.

Thanks for taking my question. My question is related to both the projects which are coming up now in Q2.

Earlier, this was scheduled to be commenced from Q4 '26. Then it got delayed by one quarter and now it is again delayed by one more quarter.

Do we see further delays in starting both the projects further?

Currently, if you ask, are we expecting any further delay? No, definitely not.

Even this quarter delay which got delayed from Q4 to now or from Q1 to Q2 was not led by any major factor. It was more led by non-availability of skilled workforce because of various factors which came and got impacted or got affected.

We could not see a progress which ideally should have happened. That's what has pushed us.

There's nothing else otherwise which is there, which we see this project can be delayed or can push this further. No other reasons are visible at this point of time.

Okay. What was the last year last financial year revenue for Chardham Chemicals which we have acquired?

Before that, I could see there was no revenue for before that, for 3 years, there were no revenue generating from the operations. For last year, was there any revenue from Chardham?

No, there were no revenue. As Tarun spoke, we are actually going to revamp this facility and bring it up to Deepak's standard, and then revenue will flow from here.

Okay. Do we see significant amount of allocation again for ramping up the capacity?

In terms of capex, you're asking?

Yes, for starting this.

No large capex expected in this for ramping up this facility or bringing it up to our standard. No major.

Then. Thank you very much.

Thanks.

Hi, sir. Thanks for taking my questions.

I had a couple of them. The first was on PCL.

What would be our current gas cost, including contractual and spot, from the existing mix? Also, how will this change with the Equinor contract?

We don't share very precise gas cost and pooled gas price, but definitely the Equinor will give us two things very clearly: one, supply security or supply surety, which definitely was a challenge in the current environment; second, it will give a cost optimization or cost benefit because of long-term contract and the way current gas prices are, the benefit is definitely there. Even the long-term rate averages if we see, we do see the benefit continue to flow from here.

How much it is, yes, that's a information still not available for public or in the public domain. We'll come back once we feel this is the right time for us to share.

Sure, sir. Basically what I was trying to understand, based on the current gas cost, even if we take Henry Hub or linked contracts which is available in the country in public domain, our ammonia breakeven or anyone who is manufacturing ammonia in the country, breakeven should come to around $550, $600.

Whereas the current ammonia price is between $900 to $1,000 or maybe slightly more than that in domestic market. Is it fair to assume that the spreads of converting gas to ammonia currently would be around $450, $500?

Without specifying on numbers, but assumption is right. The ammonia price currently is trading at much elevated level.

In fact, the last published number itself was almost around $800, Middle East FOB. That's the prices at which ammonia already trading.

With gas prices of Henry Hub broadly, yes, we do see a significant spread in the current market environment which ammonia will have.

Correct. Till the time these prices sustain, this should be fair to assume because we would be manufacturing somewhere around 125,000 tonnes kind of ammonia per quarter.

Till the time these prices remain elevated, we can make roughly around ₹450-₹500 crores of EBITDA per quarter. That would be the current assumption.

I will not go with the number, but yes, our margin in ammonia business will be significantly better than what we used to discuss or what we used to talk about.

Correct, sir, because there were a lot of questions around the investment done in the ammonia plant, and I think this is the current situation where the ammonia investment is justified. Based on current spreads, we can recover more than 30%-40% of our ammonia investment in this year itself.

You are right. This is a basic when we put in a business case for ammonia, we knew ammonia is a volatile commodity, and there will be a time when ammonia having a manufacturing facility will give lot much higher spread, and there will be time when we'll squeeze on margin in terms of ammonia.

These are the business cycle and business cycle will play both on positive, negative. This point of time, we are in a, I say, upcycle and definitely a right time for ammonia business to turn around and to make money.

Correct, sir. Then I think just if you have any estimate of your debt number, because I think the ammonia plant will help us repay significant debt which is there on the balance sheet.

Any estimate around FY '27 and what could we look at the debt number?

Not yet I'll give that number this point of time because we do have two capex going on. We may need to balance it out and see where the debt number will be for this year.

Okay. Sir, second question was with regards to the TAN supply from Russia.

Actually, we have seen disruptions in last couple of months because of the war prevailing over there, and we have seen actually blasts in few plants which use to manufacture ammonia and ammonium nitrate, and this has also led to a sharp increase in FG AN prices. Just wanted your broad thoughts, how do you view the situation in the current context, and what is your expectation?

Do you expect this to normalize in, say, one, two quarters or it may take a longer period of time for the supplies to resume from Russia?

Thanks for the question. Tarun Sinha again answering this question.

You're right. There was a temporary ban imposed by the government of India on export of ammonium nitrate and fertilizers for some time.

Also import ban by Russia.

Also import ban by Russia. Then that ban, so that caused a little bit of slowness in terms of product availability from Russia.

Also, as you rightly said, one or a couple of their plants were impacted because of some safety, security reasons. That also caused a little bit of disruption, I would say, in the supply chain from there.

The ban has been removed earlier this month by government of Russia. Some supplies are expected to resume from Russia, although the cost levels and price levels will be different.

Having said that, as capacities are getting created in India through the fresh investments, one of them being Deepak's in Gopalpur, there's a very strong, I would say, very strong case that Government of India might be thinking that once India becomes completely self-reliant for its ammonium nitrate needs, then maybe a different approach to imports will be looked at. That's the latest I can share with you.

Of course, things will evolve as we go along.

Yes, hello. Sir, I just wanted to understand, with the capex that we are doing and now our ammonia backward integration turnaround, what is the growth that we see in FY '27, and if our margins will be in the similar range that we did in FY '26 or there's possibility for them to get better?

Okay. I will not give specific numbers on margin, but in the current environment of global supply tightness, and also with Equinor gas availability or gas surety and the cost advantage which we have, we do expect improvement both on growth as well as on, I call it, our margin front.

Growth will be led both value-driven as well as volume-driven. When I say value-driven, because in the current environment, price has gone up or realization has gone up, so that will get reflected on revenue growth.

Volume growth will come more with the new capacity when it gets added, both Gopalpur and nitric acid. That will give us a large volume growth coming in this year.

Okay. Thank you so much.

Good evening, everyone. Sir, my question is on the TAN business.

What could be our utilization level for FY '27 and '28 for the Gopalpur facility? Along with that, there are some news that as Coal India is our largest client, Coal India is also working on this TAN capex.

What's your thought on it?

Okay. Now, Gopalpur utilization level, I already spoke about this year ramp-up will be there and we expect by end of this year, we should be in the range of 90% to 95%.

The utilization level will reach to its optimum level, and next year, we should see a full capacity utilization or almost similar capacity utilization from exit level. That's how the number or the expectation what we have.

Coal India, Tarun would like to.

Sure. Regarding the question about Coal India's ammonium nitrate plant, it's all in the public domain, I don't think I need to elaborate too much on that.

One can just read it. Since you have asked, so, Indian coal is very rich in ash content, and there is no coal gasification technology available currently in India to produce syngas through gasification of this high ash content Indian coal.

That technology is currently being developed by Coal India through some joint ventures, through some alliances. We do not know at this stage, we are not privy to that information how far is the progress and how long it might take to develop that technology.

Then, of course, as things progress, there will be more clarity which will emerge and it will come in the public domain. These questions are better asked in Coal India's conference calls rather than in Deepak's calls.

Sir. Second question on specialty chemical business, what's your outlook on the specialty chemical segment over the medium term, particularly the context of the current pricing and the demand, what factor could be critical for margin to recover towards the historical level?

You're talking about fertilizer business, right?

Hello?

Yes, sir. Yes, please.

Okay. Now, we are committed and that's what we continue to say, our business focus is very clearly grow our specialty business in fertilizers, and we continue to work on different dimensions when it comes to specialty business.

One, keep looking and introducing new product on specialty side. That's the R&D divisions what we have in the company works to develop those products.

Also, keep looking in-sourcing those product from our JV partners. That's the strategy.

Second, we are also looking on key market or key focus market where we know these products can help us to grow faster, where the farmer adoptions will be very fast. That's a focus very clearly the way we look, both working with R&D to improve product portfolio, and also getting deeper into geographies will give us significant very high growth compared to the overall fertilizers.

The pie of specialty will keep going up compared to the overall revenue share. Definitely, you'd have seen the margin profile of specialty business and subsidized business is different.

More share coming from specialty will help us to do a margin upliftment. That's the strategy on which we are working and will continue to work on that.

Thanks, everyone, for taking out time and extending your support to Deepak. I wish all of you best of health and good time.

Look forward connecting with you again in between the calls or during the next conference call. Thank you.

Bye-bye.