Hello all. A warm welcome to our quarter three FY26 investor call.

As usual, I will ask Mr. Maulik Jasani, our CFO, to take us through numbers in greater details later on.

However, I'm assuming that you would have had a chance to look at that already. First and foremost, let me start with, overall I'm really happy to note that, macro level, quite a few positive events have happened, which has definitely improved overall market sentiments.

This would include India-UK FTA followed by FTAs with few other countries, and a very positive India-EU FTA recently concluded, and to top it all, much-awaited India-US trade agreement. Again, with some strong directional push in capex plus long-term tax holidays announced in certain key segments in the last budget, we are all fairly confident that India can sustain a good GDP growth rate of around 7% in coming years.

As you would have observed from our numbers, at the outset I'm happy to report that quarter three FY26 performance is broadly in line with our expectation, except for a slight blip in in the form of below par performance in Romania. Our India engineering business comprising of our company plus our wholly owned subsidiary, Harsha Advantech, has continued to show a strong performance, both in top line as well as bottom line, notwithstanding the fact that Harsha Advantech, which has a which has commissioned its greenfield facility in current financial year year, has reported losses at the PAT level, primarily owing to impact of higher interest and depreciation.

Further, as you would have seen, we had we had to make a one-time provision of around ₹5.97 crore in quarter three in India for additional gratuity and leave encashment to to give effect of the changes made by the new labor code made effective by the government in quarter three FY26. This is a one-time exceptional provision required to be made retrospectively in quarter three.

Our India engineering business has reported a 17.4% revenue growth in Q3 on a YoY basis, and if we normalize the effect of one-time exceptional provision, then our India engineering business operating EBITDA margin has shown a healthy 23.8%, though the reported EBITDA is at 21.7%. As mentioned earlier, this is after absorbing net loss of ₹3.7 crore in Harsha Advantech in quarter three.

We expect a much stronger revenue performance in Harsha Advantech subsidiary in quarter four, which should increase the EBITDA and reduce the Q4 loss in Advantech subsidiary. Talking of outsourcing of cages in our India engineering business, we are steadily growing in this segment owing to a combination of favorable factors.

If I talk of cage demand in India, the same is on rise and we continue to have a dominant market share across variety of customers, and we have started supplies to a lot of our customers' new facility in India, which caters to various world market. Our export from India are also gradually going up, with in EU continuing to show revival in industrial demand for cages, though wind demand is still not picking up in Europe.

I believe that with the favorable FTAs the demand should go up in Europe in coming quarters. In this regard, large-size cages have have continued to show a strong performance, having achieved sales of around ₹39 crore in nine-months period to December '25 as against ₹31 crore achieved in the corresponding previous year nine months.

Pace of new product development continues to be strong at around 123 SKU up to quarter quarter three or only in quarter three, resulting at 382 SKUs for the nine month for the period ending December '25. Again, if you see our other growth drivers, I'm happy to report that bronze bushing business has continued its strong growth trajectory, reaching a sales revenue figure of about ₹92 crores in nine months ending in December '25.

Thus, as per our earlier estimate, we are on track to achieve about 30% plus growth YoY basis in this segment. If I talk stampings, while there are there was a blip in Q2 due to some seasonal impact on consumer goods segment, they are again catching up in Q3, and stood at the overall revenue for nine months stood at ₹41 crores up to December.

I expect stamping sales to further grow in coming quarters due to few new stamped components which are under development, which are likely to be commercialized in next financial year. Lastly, while sales growth to Japanese customer is slow, it is still a positive direction.

We are confident that though this is taking longer time, there is no dilution in our efforts, as well as the opportunity for a significant growth in our market share with our Japanese customers. Talking about overseas subsidiaries, I'm glad to state that Harsha China has continued to report a consistent, steady performance, resulting into maintaining a decent profitability and a growth trajectory.

In fact, you would have seen in our disclosure made by us in the to the stock exchanges, we have firmed up a brownfield expansion plan in China at the outlay of approximately $9.94 million for expanding cage manufacturing capacity in China with primary focus of steel cages. The logic of this expansion is that we are there is a good demand for steel cages in China, primarily in industrial segment.

We believe that we can significantly improve our market penetration in this segment in China if we increase our cage manufacturing capacity in China as a local player, which is essential not only for our existing key MNC customer present in China, but also for local Chinese bearing manufacturers who can be serviced if we have a adequate steel cage capacity in China. We will fund this expansion primarily through not debt and and then up to maybe 70% to 80%, and or rather, we will fund this by borrowing locally, and balance of it would be funded through equity contribution from Harsha India.

The expansion will be implemented at our existing site in as a brownfield expansion, and we intend to make this operational before end of financial year '28. In this quarter, we again saw Romania's performance coming under pressure primarily owing to owing to a steep increase in copper prices globally, which could not be passed on to the customer immediately as there is a lag.

This has resulted into an operating loss at Romania and the combined net loss of our foreign subsidiaries stood at around ₹3.98 lakhs or ₹3.98 crores in quarter three, and for nine months it stood at ₹6.09 crore in nine months or year to date. However, we still remain confident about Romania likely Romania likely to do better in coming quarter because of our consistent and conscious shift and focus on the finished cage business, customer diversification, as well as cost-control strategies under implementation.

Talking of our solar business, the solar division has reported a strong performance in quarter three, reporting a top-line revenue of around ₹59 crores and EBITDA of around 9%. However, I mentioned earlier, this is a order-driven business, and overall performance in the current financial year will be it's it's good and continues positive contribution this division is continuing the positive contribution to overall business.

Lastly, I feel very confident that will continue to perform well in quarter four in this segment as well, and we should be able to achieve overall guidance given in for financial year 2026. More importantly, we feel that we are on a good trajectory for next financial year and hope to continue this direction.

However, we would prefer to give our overall guidance for FY27 at the time of quarter four FY26 annual result call. Now I transfer over to Maulik, who will take us through numbers in a little bit more details.

Over to you, Maulik.

Thank you, Vishal bhai, for the overall business overview. Good afternoon, everyone.

As you would have noticed, for the quarter ended December '25, our engineering business at consolidated level have achieved a top line of ₹350 crore against the ₹363 crore top line in the immediate previous quarter and ₹302 crore top line in the same quarter last year. We have achieved consolidated EBITDA for engineering segment of ₹58.6 crore against the reported EBITDA of ₹63 crore in the last quarter and ₹48.2 crore in the previous quarter.

However, adjusted EBITDA is of ₹64.3 crore in this quarter after adjusting the one-time provision impact of the new labor code. Increasing trend in metal prices, especially copper, and lag in raw material pass-through have impacted our EBITDA margin and PAT compared to last quarter.

Also our new greenfield site at Baila has reported a net loss, as Vishal has mentioned, due to the first-year operations. We have also capitalized the second building in our Baila site in the last quarter.

Both foreign subsidiaries have jointly contributed EBITDA loss also of around ₹51 lakhs at a total level of both foreign subsidiaries. Solar business, as mentioned, has achieved a revenue of ₹59.7 crore with a EBITDA of ₹5.5 crore.

Overall working capital cycle at consolidated level is around 140 days against 146 days in the previous quarter and 145 days in the last year same quarter. We have incurred capex of ₹32 crore in the last quarter and cumulative capex of around ₹100 crore in the last three quarters in the current financial year.

With this brief note on the financial numbers, I request operator to take the Q&A from the participants. Thank you.

Hi, thank you very much for the opportunity, sir. Sir, firstly, on the India engineering business, this was the second consecutive quarter of a very strong growth wherein we have done a mid-double-digit to a high-double-digit kind of a growth in this business.

Could you highlight which are the factors, some of the end-user industries which have drove this performance? Also, if you could give us a flavor on pricing versus volume growth mix within this 17% growth that we have posted in this quarter, that will be very helpful.

One, Harshit, from our point of view, for us, the geography point of view, India is doing very well, as well as Europe, as I mentioned earlier, and both are driving the overall growth for us, being a very big segment for us. This growth is primarily we are seeing it's purely quantity-driven growth, and we are seeing a volume growth as yet.

I think in quarter three, we don't see any material impact or pass-through which has materialized, which will happen in a current quarter. Overall, we are seeing strong demand across all segments, industrial as well as automotive, and overall globally we are seeing industrial segment slowly improving, which was in a negative cycle over the last year and a half, too.

Which is recovering is how we look at it, and so that's how we are seeing it. For us also positive is bushing growth and stamping business growth, which are largely domestic focus.

That also supports India growing overall very well, so that is also supporting.

Just to quickly add one thing, this year if you see there is also a growth in exports. Pehle kya hota tha for last couple of years that India was growing domestically but exports were pulling us down a bit.

Now export is also showing about 10% growth. That is helping us showing a much better growth number at India level.

Understood, sir. Secondly, on the capex that you have announced in China, we have announced a capex worth about $10 million.

It is a pretty significant number. Now given that we are still operating at about 55% capacity utilization over there, do you see that the demand is going to be very strong in the near term, and that is why we are expanding, we are sort of trying to preempt the demand over here?

Also if you could give some flavor on when we would have expanded this capacity, on that new scale and size of the plant, what would be the maximum revenues we can do at the China level, maybe in FY29 because FY28 is where your expansion will get completed? At that scale, what kind of revenues and EBITDA margins we are aiming to do?

Slightly longer-term broader question, but any outlook on that will be very helpful.

Yeah. Again, in China, there are couple of things happening.

As I mentioned, we have a significant brass capacity located locally in China. However, when it comes to industrial steel cages, we don't have any local capacity, and we are seeing industrial segment grow, and our ability to participate and get some share of business significantly changes when we are a local manufacturer there.

That's what is primarily driving this capacity expansion. Within China, what we are doing is so there is some amount of brass capacity also expansion part of this expansion plan.

Now in this investment, a big chunk, about 40% plus is infrastructure, which includes building and few basic infrastructure we need to build to actually house a lot of our dedicated capacity there. That is a big chunk of this investment, and then we are adding cage capacity, as I mentioned, primarily in the steel industrial side where we are seeing a good demand and growth and opportunity to penetrate local markets.

That's the rationale. From a number point of view, it will be very difficult to give you a very precise number.

Having said that, we are looking at for the equipment we're going to install, we are expecting at full maturity it should give double the

Around 2x,

yeah.

Around 2x turnover at the peak.

Current revenues will be double. In China.

We are looking at the double 2x overall revenue in China when the full maturity of all this capacity takes place. Now that still leaves us with a additional infrastructure for further expansion because we are doing a full infrastructure expansion right now.

We are kind of keeping space to accommodate any growth opportunity comes our way in a different segment, and so on.

Understood, sir. Thank you very much for answering my questions.

I will come back in the queue.

Thank you, Harshit.

Thank you.

Hi sir, thank you for the opportunity. Sir, my question again on China.

What is the kind of understanding the rationale to expand? Will it be you're penetrating completely local this 2x sales which you're trying to achieve by FY29, FY30?

It's combination of our existing customer as well as local. We are seeing opportunity to get better market share through localization even in our existing customer base, as well as some of the access to customer is not available if we are supplying out of India, we are kind of creating that.

It's a combination of both local customer as well as our global MNC customer increasing the wallet share with them.

Just to add there, Amit, that in the specific industrial segment there are areas where in China there is only one or two local suppliers and there is no major suppliers available, and hence even the local bearing manufacturers need reliable and consistent suppliers as alternative suppliers, and there where we have a great opportunity to even capture the local manufacturing bearing companies in the industrial segment of the steel cages.

Right. Is there anything with the existing customer you'll be able to utilize maybe 50%, 60% of what you're installing?

Any ballpark or it is still open that once the factory is...

There is definitely great dialogues. No, we don't have a clear commitment, however we have a good engagement and discussion going on, and the some portion of capacity will definitely go towards supporting our existing customer and a bigger wallet share of their demand.

Right. Are we kind of confident of margins having from the past experience in China?

What is you're looking for in terms of margins or something with this expansion? Probably looking at the past we have seen challenges with our international subsidiaries anyways, yeah.

We are confident that at the right revenue level we will improve our existing EBITDA in China. We see a better margins possibility here and that's also one of the incentive for us to go there.

Also, there is a need of scale at China level, which will also help us...

Operating leverage.

...create operating leverage, improve our margins even on the existing portfolio as well. Yes.

Right. Sir, again on this thing, you said somewhere in your commentary wind demand is not picking up in Europe.

I think is there any implication for bushing's business that there might be some challenge or because I think you have written it is growing strong, but I am just trying to understand from what you mean to say for wind demand.

I think our bushing business is focused on replacement-driven concept. That's why that is continuing to grow in spite of Europe wind not doing as well as we expect.

However, a significant portion of our Romania facility is supporting wind market, which is not as a wind market overall in Europe is not doing that great, and that's the reference I was kind of mentioning that. We don't see that as a correlated.

At a full conversion maturity the bushing business will follow the wind market what is going on in wind market, but having said that right now we are in a very different phase when it comes to bush where the focus is on whatever is the existing wind application converting into bushing and that will drive the growth.

Right. Sir, lastly on Romania, you said this quarter was impacted by commodity prices and probably that might continue in 4Q.

What is that you're looking at now Romania? Last time I think there was some recovery there and you highlighted that time.

Now with this challenge, what's outlook for next one or two quarters in Romania?

I think I will not be able to exactly say how it's going. There is lot of volatility in the commodity market.

We do have a pass-through mechanism so we have a quarter-to-quarter impact and correction. What we have seen so far, there's significant volatility so that is a risk and a concern remains.

Having said that, as I mentioned earlier that our improvement program is going on. We are improving the revenue and the product portfolio, doing more cages and so on, which is taking traction.

Apart from this specific challenge, I think if you look at comparison on the revenue side over last year similar quarter we have grown and we have improved our product portfolio. We are not at all where we need to be, we are continuing to work on that and evaluate the situation, engage with customer, and see what's the right path going forward on this.

Thank you, sir. Thank you so much.

Thank you.

Namaskar, sir. Hope I'm audible.

Namaskar. Saket.

Thank you, sir. Sir, firstly, if you could just reiterate for the sake of repetition also, on the guidance front on what is the likelihood for us to exit FY26, firstly?

We had, Saket, said that we will be, in terms of growth, a little over 10% overall. This Q4 should also continue the same run rate with maybe a little bit marginal improvement.

Let's see. That's what the guidance was, we are, I think, on track.

We should be okay.

On the margin front also, on the standalone business reported 23%...

Margin will be better and we are aiming at in the EBITDA range as we had talked about, and the PAT range taking the last Q3 run rate and then slightly improving our Q4, we should have a much better bottom-line growth in FY26 as compared to FY25.

No sir, the EBITDA margin we have for the standalone business was at 23%, 23.4%, that is what we have reported. We are confident on...

We are confident of maintaining, yes. No, see what happens, there is always a quarterly lag between the commodity prices and the selling prices.

Humne bola hai ki at India level consistently, we should be in the range of 22% to 23%. 22%, 23% [taka ki?]

range yeh chalegi. Then a little bit of impact of Advantech will be little lower as compared to Q3 this year in terms of loss, to thoda loss to aayega Advantech mein.

It will not completely break even, it should break even from next year. To the turnover is steadily increasing, Advantech mein aur bhi turnover badhega Q4 mein, as Vishal said.

There are quite a bit of moving pieces, but main yeh maanta hoon ki we should be reaching the targeted PAT level in the range of around say maybe 145 or so. Let us see.

Okay. Sir, agar hum hamare teeno ikaiyon ko split karein, if you could just give the nine-monthly performance for sales and profitability for Romania, China, as well as Advantech separately just if you could give the number.

Then, sir, on the Romania part of the story, if I remember correctly, we were about to discuss and articulate the strategy or restructuring for the unit wherein better deliverables from the same can be derived. Where are we, sir, in terms of that?

On the numbers, we have already given numbers in our investor presentation for India engineering business and foreign subsidiaries performance, you may refer our investor presentation, there you will find the numbers. On the Romania story, yes, our focus is still on the same side on enhancing our cage proportions compared to our current casting proportions, and dialogues is already on with the customer.

Sir, I was looking for the split between the China and the Romania business separately and the Advantech. Can you have that all three separate numbers?

Sir, I tell you, as a matter of strategy in the past we are always giving a combined number at the foreign subsidiary level. You will see that the loss was about 6 crore in the nine-month period at the foreign subsidiary level.

Main yeh maanta hoon ki there could be a little reduction in Q4 in terms of combined loss, but you may take a combined loss in the range of maybe around 8 crore for the year end for the foreign subsidiaries. Advantech mein humne aapko bataya ki Advantech ka loss ka figure bhi we have already given, it was 370 lakh in the Q3.

It should reduce in Q4, but it will still be at a loss level. I think exact number we will not be able to give, but this is already given, the way we have explained actually.

Sir, two small points. Sir, in your presentation you have mentioned about and earlier also about this lower offtake from your Japanese customer.

If you could just allude to us where are we in terms of the deliverables and the order booking from the Japanese continent? Then, sir, in the slide we have mentioned about this diversification in precision stamped and bushing components.

This stamping is also attributed to the bushing part of the story, or we are separately doing stamping of other tools also?

We are doing beyond bearing cages and bushing, we also supply stamping components to our customer which are automotive as well as consumer goods and some industrial goods and so on. That was about...

Stamping is separate than bushing.

It is an extension of our capability for manufacturing steel cages, which is a stamping process. We have developed some very special components like railway seals or compressor, special type of compressor stampings, etc., which is extension of our technology skill set into a little diversified field, but keeping the same value addition in mind ki hum 20%, 21% [taka?]

se neeche dhandha nahi karna chahenge, we are not doing me-too kind of a situation. Bushing is a replacement for bearings in the gearbox, windmill gearbox, it's a very different application.

Right. Sir.

Just to harp on over the stamping part, this will be in the Advantech unit we are doing or it is in the older plants only?

Both. We have existing mein bhi hai aur Advantech mein we have created additional capacity for bushings and large-size cages.

Okay. Lastly, sir, if you could just give us your message for your investors.

We got listed in 2022, we were spared from what happened in COVID in terms of valuation, but even if that taken into account the vagaries of the market, the business environment, geopolitical issues, every aspect, value creation has not happened for your investors, that is including the promoters who hold 3/4th of the equity. We have seen what on the deliverable front.

What else and how quickly would this translate into value creation for us in terms of consistent, profitable, predictable growth for the organization? If sir would just throw some insight on the same.

Hey, Saket, see you are right in what you have observed, but also please appreciate that macro-level factors are beyond our control. At every single point in time, we have been very transparently communicating with the shareholders and investors that what is the current status.

With 35% of my business coming from Europe globally and Europe going down, and then the geopolitical tensions, with all this, I think we have done very well in terms of quickly going to the drawing board, reworking our strategies, and trying to grow and trying to maintain a decent growth. I think I don't want to speak more, but it seems that this year was much better than last year, and now next year will still be better.

Our job is to be transparent about what the current state of affairs is, what is our strategy, and how we want to keep the company on the growth path. Market is something which nobody knows and we can't control, that's all.

Hum apna kaam karenge and we'll be very communicative about what we want to always transparently feel as correct.

Right, sir. I'll join the queue, sir.

yeah. Yes, I'm joining the queue, ma'am.

Thank you so much and congratulations on very good set of numbers, sir. Sir, couple of questions.

First, if you can give us the revenue breakup for your new businesses: bronze bushing, stamping, large-size, and Japan-based customers for nine months current year and comparable numbers of last year.

I think, Manish, that was covered in Vishal's commentary. Let me repeat it for your easy reference.

Please, if you can.

Yes.

Large-size cages, we did nine months 39 crore around versus last year same nine months it was around 31 crore. Japanese customers is around 51.5 crore of 50 against 50 crore rough in the last year, almost stagnant.

Stamping, we did around 39 crore and 41.2 crore in this year, while the bushing around 74, 75 crore last year versus 92 crore this year for nine months.

Okay. Related question is that roughly if I do the math, it is contributing 21% of your revenue, all these three, four categories.

How do we see this going forward over a period of next two years and three years, or maybe what kind of visibility we have? Probably this business can double up in two years?

That was first question. Second also question is on the cages business, that independently how do we see growth rate in the cages business?

Right. I don't have a very precise double up number like that, but these are our focused growth drivers where we see good opportunity, and that's why we keep on mentioning the numbers and sometimes we don't do as well as we expect.

Having said that, we expect a very good growth in all this segment. It may happen that one segment may kind of falter for a while or something like that.

Across all this segment we have signed a lot of new supply agreements with our customers, and we feel that they are on a good growth trajectory and realization will happen soon. On the cage side, we see that as a product a very strong growth continuing.

It's basically what we offer to our customer in terms of cages is a very unique proposition, and we are fairly confident that what we bring to the table will bring us that additional growth. We are seeing also that is also driven by how our existing business, which was supplied into Europe or US or other location, how those clients are doing.

However, in India it is doing very well, continues to grow, and we feel fairly confident overall about cage business as well. Just to add, large-size cage actually is a subset of our cage outsourcing for the simple reason it's carved out separately because it was a relatively low wallet share.

Before 5 years, just 0.5%, 1%, now we are targeting it maybe at least 5% to 7%, and that's one area which is growing very well, so that's very much a part of outsourcing. I think overall all this Japanese customers also same, our wallet share with them was 1% or 2%, we are targeting at least 5% to 10% in next 2, 3 years.

These are within the bigger subset of outsourcing, these are carved out subsets with specific focus.

Sure. Sir, you did mention that the new product developments is gaining pace, would like to get a perspective as to are we gaining market share with your customers and the resourcing, like you said, started supplies to the customer's new facilities in India.

How should we look at it? That probably next year we can look for a double-digit growth overall for the company?

See, for us product under development or development is a leading indicator. What that means is that customer is continuing to give us product which we will develop, and commercialization of such product may take anywhere between 6 months to 2 to 3 years depending on how customer is approaching.

In case customer will decide sometimes that only when you complete the complete portfolio that we will start commercialization, and so on. Basically we mention that as a kind of an indicator that our pipeline is strong and that's this.

Now in terms of doubling the growth, I think it depends on variety of factors. It depends on how the industry is doing as well as how the new projects come online, and we are very hopeful and confident that good revenue growth is in pipeline, but it depends on all those factors, it's difficult to exactly put a number to all that.

No, sure sir. On the margin front, sir...

Your question was whether next year we will go for a double-digit growth, correct? As I said, definitely that is the target, but we want to give you a little more precise guidance based on certain new developments, we'll come back to you at the end of Q4.

Okay. Sir, particularly on the margins, the standalone engineering margins what we have seen for engineering business at roughly 25% for this quarter, is this sustainable going forward, also in context with now that steel prices have started inching up, copper prices are inching up, how should we look into it, sir?

Usually, Manish, we have said that our margin should be tracked on the absolute front, considering there is a material pass-through impact impacting the percentage either on the upward side or downward side, as the case may be, or according to in which cycles we are going into. Our suggestion is the same: please track our absolute margin improvement, and we are confident to improve that margin definitely year over year as well as quarter over quarter.

Maulik sir, what is the time lag for you to pass on the cost? Is it on monthly revise basis or quarterly basis?

Usually, as Vishal said earlier, 3 months is the period and with a 1 month as a legging, 4 months total lag. Again, customer to customer it varies, and on average you can consider as a 4 months.

Right, sir. Are we seeing any immediate benefits from the FTAs what India has signed with the UK and EU, and also now with tariffs coming down in US, how should we see the prospects going forward, sir?

Obviously, the export demand will pick up, that's our expectations. There is no direct linkages, but definitely there is a linkages, and considering that our product is a multi-usage product and multi-industries usage product, we can't identify exact end-to-end benefit, but yes, we see that as a positive outcome for our business line.

Okay. Last question...

Just to add on the US front, our share was not very big anyway in US, around 8%, 9%. To that extent, we were rather sort of neutral or agnostic to that.

Yeah.

Sure. Last question, sir, on the new facility.

Now we have started the second building, capitalized the second building as well, what kind of ramp-up we see, what kind of utilization visibility we see from it next year? Can it revert to a company-level margins next full year?

Our anticipation is to do it early, but as we have committed, any new capex usually takes 2 years to reach to the peak and we are on the same track. We don't see anything lagging there.

Sure. Thank you so much for all the answers.

Hello?

Yes.

No, just one question, just want a clarification. This Q3 presentation, the international revenue share has been restated for the quarter two FY26.

Any reason for that? Was there a typo earlier or...

We observed some arithmetical error.

In the last quarter, we made some arithmetical error. We have just corrected it.

Because even Q1 has a very higher share of international revenue, maybe if you can provide that clarification later.

See, yeah, that's what. Q1 and Q2 there was an arithmetical error.

The base number has been corrected now, and that's the reason. Previous years were correct.

Fine, Maulik, I'll get the numbers from you. I'll get the numbers from you.

Thank you so much.

Sure.

Thank you.

Hi, sir. Thanks for taking my question.

On European demand base, how does the current inquiry pipeline look like in European OEM? Any color on RFQ advancing towards the prototype or the...

Hello, can you hear me now?

Sir. Just wanted to understand on the European demand front, any new program for the RFQ advancing towards the prototype or the validation stage, or any new program wins for the global sourcing mandates, which provides comfort for our sustainable double-digit growth for the near term on Europe?

From a customer engagement and all those point of view, we continue to respond to RFQ, but for us the RFQ to realization cycle is pretty long. What we see is what our customer is asking us to develop, which becomes a more better benchmark in terms of how growth is coming, how things look like.

That has remained strong in spite of whatever we have seen last 1 to 1 and a half year. That part of it has remained strong.

We are engaged on few additional RFQs, additional opportunities, but that depends on those projects get decided based on variety of factors and it's not just in our hand or our competitiveness. It's a macro, big level, big projects which depends on how our customers are approaching variety of things.

Overall, I would say it remains positive without saying that no, that's not a very accurate indication for us.

Got it, sir. Got it.

Sir, on the sales to your Japanese customer, it seems to be stagnant on a YTD basis. Is it more of your slower program ramp-up from the customer's side or is it a kind of a delay from our side?

It's a little bit of both. Last quarter I mentioned that there were some programs which got delayed at our end, and then some of it was demand and delay from customer end, on.

It was combination, and we are very hopeful that we'll come back on track. Also adding, Jaimin, there also the global cues add over there.

Because of the global uncertainty, customer was also delaying their long-term calls of transferring or enhancing their supply chain outside their comfort zone. We see that the things are settling down in global side, these things will ramp up now.

Got it, sir. Got it.

If we understand on Advantech front, it might take 2 years to reach optimum mix. In terms of ramp-up, how your scale-up looks like for next year, for next year itself?

How should we think about that? Is there any delay on the customer validation front, anything on that color front?

No, things are on line, Jaimin, but considering this is a new plant and at a early stage, give us a quarter or two quarters more where we will be able to give a better guidelines considering the customer's acceptance and approval stage over there. Yes, as we said, we see that we are on the same track of achieving the optimum level within 2 years or around in 2 years from our capitalization.

We see that ramp-up will come and it will comes faster stage once we get approvals.

Got it, sir. Got it.

That's it from my side. Thank you so much.

Thanks.

Thank you for taking my question. I'm audible, right?

Yeah. Jason.

Yes, sure. First question just pertains to when I just take the consol minus standalone, you get the subsidiary numbers.

When you look at it, the loss is around 157 million. Now I understand even this quarter 4 crore loss is from the Advantech and 4 crore loss is from the overseas subsidiaries, that is how it is panning out.

Sir, just in light of the same, just wanted some color on 26 is almost done, 27 how should it look when you look at, even you look at Advantech and you look at the overseas subsidiaries, how do you look at it? How does this loss thing should go ahead or some profitability, just some color on these two aspects, I wanted from you.

Jason, I think some arithmetic I want to clarify before Vishal or Maulik moves on. At the subsidiary level, as I said, the loss for 9 months is about 6 crores, correct?

Advantech, as you could see, we have already given the figure that Advantech was around 9 crores, that is how you are looking at 15, right? For 9 months.

15 crores, right.

No, no, no sir. See, when you look at the complete subsidiary loss, okay, just for so my number what I said was 157 million was for 9 months, okay?

That's a PAT number I'm looking at, 157 loss, okay? Simple consol minus

standalone. Correct.

Reported PAT, yeah. Now this this quarter Now let's not confuse, but I understand it's a combination of Advantech loss and the overseas subsidiaries loss.

This is what predominantly is 80%, 90% of the thing. Just wanted to know how this should go to 26 and 20 26 is almost done, 27 how do you look at these two factors playing out, how should it how should we look at it?

That's what we said, we will give a better guidelines on 26 in the quarter 4 year end. Just to give you some heads up, is that obviously Advantech will turn positive and China continues to grow in the same territory with a better margin, and Romania our intention is to make it break even first at EBITDA level followed by at a profit level.

That's the major intent.

Okay. Sure, sir.

I'll look forward to the Q4 guidance. Sure.

Sir, in terms of the standalone revenue, we should be able to track, you did mention standalone engineering revenue, just would want to know 10% revenue growth should be a fair assumption for 26, 27 going ahead? We should be able to do this 10% revenue growth at least?

Jason, same answer, wait for Q4 end.

Correct, you may.

Yes. Okay.

Sir, just in terms of this ramp-up, you mentioned Advantech will take 2 years, okay, to ramp up, I understand. Peak revenue again probably 2x is a fair assumption.

How much of investment, sir, in Advantech? Just wanted to know, just a calculation of peak revenue.

On the plant and machinery investment, yes, you can consider 2x.

2x. How much would that be, sir?

Huge infrastructure and land and building.

Correct. So...

Currently investment is around 210 crore

plus.

I don't have precise numbers on hand,

Jason, but

majority of that is also infrastructure and land and building, while machinery is around 100 crore plus, 120 crore something.

120

crore is machinery, that will be 2x.

We have to take the 2x on the machinery, right. Fine.

Right, sir? Okay.

The main products from Advan-...

Sorry, Jason, incremental machinery is coming up. That will be still in a pipeline and we will give that also in guidelines.

Sure, sure, sure. Of course, that has to be on the plant and machinery only.

Other infrastructure is common infra. Get it, sir.

Sir, the main products from Advantech you have mentioned before, but just wanted to clarify. The bushing, stampings, and the large-sized cages, these are the main products from Advantech, is that right?

You are right. The incremental growth and new businesses of these three lines.

Right, sir. Sure.

Sure, sir. That's all from my side.

Thank you. Thank you so much for answering my questions.

Thank you.

Just a follow-up on what the participant just mentioned. Sir, for Advantech, the product profile would be skewed towards bushing and large-size cages?

Right.

Yes. Stamping, a little bit.

Okay. Sir, I think for the large-size cages you did elude earlier about the market and there were some deterrents which we were trying to resolve.

Correct me there, sir, what was the business environment or the demand pertaining to the large-size cages?

Couple of quarters back couple of quarters back we did mention that, market for industrial product was very sluggish and that was the reason for very moderate or not much growth in large size. We might have mentioned that.

I think we we are seeing that turning around. Over and above the fact that we we are looking at more additional product development and orders for future in this.

Those factors are somewhat improving what we had mentioned earlier.

Okay. Sir, total investment for Advantech, are we done with the entire capex?

Also for the commercialization part, what is the closing for capital work-in-progress is there?

No, as I just said in the previous question, Saket, the incremental plant and machinery will continue in Advantech, considering that wherever there is a requirement of additional capacity and wherever we see the incremental growth can come, we will continue to have a plant and machinery spending there.

Correct, sir. Still, sir, we have something to commercialize.

If you could give as on date how much have we invested including the land for this unit? Or if you could give the bifurcation?

No, to answer your question, yes, there are few work-in-progress in capex side also, including on the building sides there are some other buildings like admin and others are under capitalization, yet to be capitalized, and some plant and machinery under installation. Around 40 crore is the rough numbers top on my head.

Okay. Sir, what should be then the total investment for this unit as a whole as on date?

It's an ongoing thing, but yes, we expect it to end this year around

250 crore plus. 250 crore plus.

The peak revenue for this also will be 2x or will be different to assume today because of the large-size cages and the bushing part? What should be the peak turnover that we may expect, or the asset turnover ratio?

2x of the plant and machineries, but you also have to keep in mind the incremental plant and machineries to be in pipeline. Yes, 2x of the plant and machinery, not of the full capex.

Sir. Right, sir.

Thank you for all the elaborate answers, sir, and all the best to the team.

Thank you, Saket. Thanks.

Thanks.

Thank you.

Sir, thanks for taking my question again. Sir, just one last question.

Just wanted to know, sir, in terms of capex, what we are guiding for 26 and 27 on a consol level?

Wait for Q4, sir. Jason, same answer.

Okay. Okay.

Sure. Sure.

Sure, sir. Okay.

Okay.

Thank you, Jason.

Thank you, and today I would like to thank you all for continued confidence and support for Harsha Engineers, and then I wish you all very good evening. Thank you very much.

Thank you.

Thank you, everyone.