It's early 9:30. We welcome all of you to the third investor call meeting of this financial year 2025-26.

I, Sachin Kumar Srivastava, your Company Secretary, on behalf of the company and management, welcome all of you to the third investor call meeting. I request Pranay to start the proceedings of this meeting.

Thank you. Thank you, Sachin.

Good morning, everyone. My name is Pranay, and I lead the brand and marketing at Pakka.

On behalf of the entire team, I'd like to extend a very warm welcome to all of you to our quarter third investor call. Thank you.

Thank you for joining us today. Before we begin the presentation, please allow me to introduce the leadership team: Mr.

Ved Krishna, Business Head; Ms. Neetika Suryawanshi, Finance Head; Mr.

Shubham Tibrewal, Food Services Business Head; Mr. Sachin Srivastava, Secretarial Head; and Gautam Ghosh, who is leading liaising and corporate governance.

Once again, welcome to all of you. I'll just start sharing the presentation and hand it over to Ved.

Just a second.

Namaskar to all investors. It's all visible.

I'm starting, Pranay. Namaskar to all the investors.

Thank you so much for joining us on this Monday morning. We are excited to share the progress that we've made in the last quarter with you.

There are some very, very interesting developments that have happened, and I'll take you through the highlights and then hand it over to the team to get into more details. Of course, the first and the foremost, we know that the first two quarters of this year has been a little bit of a challenge, mainly because of the extension of the shutdown period when we were trying to expand the capacity of PM3 and bring part of the Jagriti project online.

As you may notice that profitability is turning around. We are expecting even better performance as we go forward.

Yes, we are back in action and definitely looking forward to the next few quarters. The big one that has happened in the last quarter is the stabilization of PM3.

We're still expecting the productivity to rise significantly in the coming quarter and subsequently after that as the new expansion and the technology changes that we have done stabilize further and are able to provide the outputs that we're looking for, both in terms of quantity as well as in terms of quality. There is a lot of solidity that has come into the project that we have undertaken as in the name of Jagriti.

A lot of the sections are going to start producing in this quarter, especially the new power plant, the recovery. It should be around end of March, early April.

Then, of course, that new paper machine has also made significant progress, and we are definitely expecting in the first quarter of next year that there will be significant movement in that. If not commissioning, then at least very close to commissioning is where we will be.

We will also share a few photographs as Project Jagriti stands today after my presentation. There has been a significant effort in strengthening of leadership.

As you guys noticed in the last quarter when we met, there were a few changes that we had made to the leadership. We are building from within.

Of course, I am personally working with the team to make sure that we become more and more solid. There is a lot of new energy that has come in with a lot of developments and mostly people who have been with us for a long time are being developed to take over the reins in the next year or so.

There is a significant momentum. I know there were some challenges that were kind of expressed last time in terms of the remaining warrants/equity funds not coming in.

We have kind of explored numerous conversations in terms of how we can bridge that funding. More than anything else, we find that we are strengthening internally, and a lot of the project will be able to be funded even internally as we go along because of course the banks release the money pro rata, and we are in good shape at least for the next couple of months.

Then after that, we are expecting the profitability to be enough to pull the project through. That said, we keep looking for possibilities in terms of some more kind of bridge funding in order to have more liquidity.

Again, we felt that we were kind of too thinly spread in numerous directions. We have taken a strategic decision to slow down the activities both in US and Guatemala.

We do have pending orders and you'll see some revenue also coming in from US in the past quarter, and there are some pending orders which we will fulfill. There is a little kind of a step back before we stabilize the India side first, and then we will look into both the directions that we were doing.

Every kind of base work is in place, but the actual actions we might delay for the next six months or so. Of course, the big one that we are after is the optimization of our flexible grades.

There have been significant developments in terms of tie-ups within the country, in terms of pushing and creating paper substrates within the country, looking for different operations in order to be able to get the conversions done within the country and being trials done. There is a team that is fully in place and is working towards numerous ideas as we go along, and you'll start seeing changes here as well.

I'll hand it over to Neetika.

Just before that, I think some of you have raised your hands. Just to clarify, we'll take all the questions at the end of the presentation, and we'll give ample amount of time for each of your questions.

Just before I hand it over to Neetika, here is a short glimpse of Project Jagriti, as Ved also mentioned, with some photographs. With that, I hand over to Neetika to take us through the India business performance.

Thank you, Pranay. Greetings, everyone.

I'll just request you to move to the next slide. Thank you.

These are our performance numbers for the entire business as a whole. I think I would rather lay stress on the wrap and carry side and let Shubham take over for the food services side, if we could just move to the next slide, please.

As Ved just mentioned, I think we have been lucky to rebound. As you can see that the performance has improved considerably from the last quarter.

Year-on-year, if I were to compare, yes, we are still a little bit down from year-on-year performance. I would like to starkly present here that in terms of the revenue, if I look at the absolute number, there is a gap of about ₹12 crores, of which mainly the difference or an absolute number is about ₹2 crores drop in the other income that we had.

That was primarily the interest income that we were getting from the fixed deposits that we had from the money in the equity. If we look at the PBT number, this gap reduces even year-on-year basis.

What I'm trying to highlight here is that despite a 4% drop in the profit in the, sorry, 4% drop in the prices, we have been able to contribute a lot and cover up a lot in our operational efficiency. This is why the gap in the PBT actually drops.

That's all that I wanted to say. I think we have been efficient enough to cover up for the gaps, and we look forward to a better quarter.

We move to the next, Pranay. I hand it over to Shubham from here.

Thank you.

Thank you, Neetika. Good morning, everyone.

This is the performance for Q3 for the food services business, and you can see that we have improved the business compared to the previous quarter in terms of revenue. The year-on-year growth is slightly slower.

I think the key message here that you would like to share on the revenue is that we have put into place a lot of initiatives, a lot of strategies, and we've made a lot of changes to our offering of what was being proposed by the brand. These initiatives are slowly starting to take form.

We are not yet seeing the full-blown impact of it, but we are definitely moving in the right direction, and all the indicators are also showing that these efforts are starting to yield results. On the PBT side, our losses have slightly widened as compared to the previous quarter.

This is primarily due to two factors. The first being we had some inventory built up from some past months for some products which were not moving as fast.

We ran some liquidation schemes, which has widened our losses a bit. Also at the plant, a significant amount of upgrades were made to the equipment to improve the efficiency.

That is contributing a bit to the losses we are seeing here. Pranay, can we move to the next slide, please?

[foreign language]

It's okay.

I think someone's not muted, Pranay. Can we mute everyone?

Sachin, can you just check on that? I think it's okay now,

Shubham.

Yeah. Looks good.

Thank you so much. As I was saying, the revenue growth initiatives that we have rolled out, they're starting to show results, and we are quite confident of the coming quarters, which will be a lot stronger, and we start to see much better results going forward.

One very, very positive indicator is our growth on B2C side. The revenue has increased 80% year-over-year if we look at the first nine months of this financial year versus the last.

An important aspect of the B2C bit is that we work with much better gross margins here. As our share of this business improves, the overall profitability will also improve.

This growth is primarily driven by our effort to increase the number of B2C channels and marketplaces and touchpoints that we had. We added five of them in Q3, and we will be adding another five in Q4.

On our delivery range, we are ready to launch this product in the market in this quarter, and we will be launching it with some very exciting key strategic partnerships which are under discussion and regarding which I hope to be able to share some very, very good news in the coming weeks/months, or you may just see it somewhere else. We are very, very excited about this product range, which will be coming out.

On the new products front, we have also launched quite a big range of products in the last three months, which we've added to the brand. Some of those are clamshells, meal trays with lids.

What this is doing, it is basically adding to the revenue and profitability, of course, but it is also unlocking certain customer segments for which we did not have an offering until now. It's allowing us to widen our reach.

I'd just like to make a small focus on the product front here. The new products we're launching are, of course, contributing significantly to the sales and the gross margin that we have.

We have planned a very strong product pipeline. One of the strategies which we're executing to kind of grow the business further is to be able to offer our customers a full product range.

We want to give them a one-stop-shop solution. All their compostable disposable packaging needs are available with us.

For that purpose, we are launching three more categories of products. We will have the leak-proof delivery range, which I just spoke about earlier, sipper lids and dip cups, and in ancillaries, straws and cutlery.

Thank you, Pranay.

Thank you, Shubham. Ved, over to you for the quarterly commitments and plans.

I'm just going to update you on the commitments that we had made last time and the new ones for this quarter. Delivery range, we, as Shubham just said, we are almost there in the sense that it is almost baked and ready.

As we speak, the samples are being distributed, and as Shubham said, there are some exciting announcements that are going to come in the next few weeks. Again, continuously optimizing the range for wrap and carry to be able to again improve the machine efficiencies and the focus on certain applications.

This was again something that we were searching, but like I said before, that we are internally strengthening the team and building more business leads from within the company. Flexi structures, again, numerous trials have already taken place.

There is a lot of building up of applications, and we are looking to again try and especially optimize the products that we're going to build on PM4. Again, this is something that has been refocused.

We had thought of doing a smaller project in Guatemala, but we felt that it is time that we first zero in our efforts into India and stabilize Jagriti as well as the current operations, and then look at Guatemala. It has been refocused and put on a little bit of a pause.

These are our commitments to you in the coming quarter. Again, delivery range, this is something we are super excited about.

It has been in the works for about maybe at least two years now, and this is something that is hopefully going to create a significant impact in this quarter. See, again, like I said, PM3 has stabilized, but we want to again build the efficiency to be much stronger, and the work continues with our German partner that has supplied the new equipment.

Again, innovations, we have to keep investing in innovations. There are a couple of strong prospects that we are looking at, and we will continue to progress in that direction.

There is two kinds of flexi structures that we've created, and we realize that the market is very, very resistant to cost increase. We are optimizing the cost of the metallized structure and also building towards the right non-metallized structure.

Again, Project Jagriti has been the focus for us, and there is significant movement, as you saw by the pictures as well. We'll continue to work towards that and ensure that we deliver a very strong project in the next few months.

That's it from us. Pranay, over to you.

Thank you, Ved. Before we move on to the Q&A session, I'll just request Sachin to announce the annual investor meeting plan.

Over to you, Sachin.

Thank you, Pranay. Before we move towards the question and answer, I would like to take a moment to update you on an important engagement initiative of the company.

In line with our commitment to transparent communication, structured investor engagement, and consistent disclosure practices, the company has released its annual calendar for investor meets. The calendar outlines the proposed schedule of the investor interaction for the forthcoming financial year and has been duly updated on the company website and shared with the stock exchange shortly.

Allow me briefly walk you through the key milestones. The Q4 investor meet is to be scheduled virtually on 2nd May 2026, enabling wide participants from our investor and analyst community.

The Q1 investor meet is planned on 27th July 2026, which will be conducted along with a plant visit at Ayodhya, offering participants an opportunity to gain firsthand insight into our operation as well as our Jagriti project. The Q2 investor meet will be held on 31st October 2026 in Mumbai, facilitating direct interaction with the management team.

The Q3 investor meet is scheduled to take place virtually on 30th January 2027. Finally, the Q4 investor meet for the following cycle is proposed on 24th April 2027.

These engagements are designed to provide the investor our periodic business updates, strategic perspectives, and operational highlights, which will ensure equal and timely disclosure of information to the stakeholder. Thank you.

Over to you, Pranay.

Thank you. Thank you, Sachin.

We'll move on to the question and answer round. There are some ground rules so to ensure that everyone gets a chance.

I would request each of you to please limit your questions to two per participant. Please use the hand raise button.

Some of you have already raised your hands. I'll go sequentially.

When your name is announced, kindly unmute, ask your question, and please mute, and the addressee will respond to your question. You can also share your questions on chat.

We will be responding there actively. First question is from Ms.

Kunjal Jasani. Over to you, Kunjal.

Hi. Am I audible?

You are audible. Please go ahead.

Yeah. First question is to Mr.

Ved Krishna sir. Last time he spoke about buying shares himself.

Would like to know more about the same because nothing of that was spoken in this. Second question is, as I heard that you're planning to keep a meet in Mumbai as well, a physical meet.

We need to do more marketing on it. We need more people coming in, more big HNIs, investors coming in, which will actually help us as a company to be known in the investor circle.

That's it.

Thanks. Thanks, Kunjal.

That work is continuing. Of course, the idea is to be able to invest in some shares myself in order to be able to give more confidence.

We are generating funds for that. Once we have those funds ready, we will look towards investing.

The work is on. Yes, I agree with you on the Mumbai meet.

Sachin, maybe you can make a note of that, and let's ensure that the attendance in that meet in October is significant to be able to create more awareness around Pakka. By then, I guess we'll be more stable in the project and everything else as well.

Thanks, Kunjal.

Thank you. Mr.

Kaustubh, you can go ahead and ask your question.

Hi. Thanks for taking my question.

I want to step back a bit to understand. There were two projects, right?

Project Jagriti and Project Cuauhtémoc, right?

Right. Sure.

Go ahead.

Project Cuauhtémoc was related to your Guatemala plant, right?

Yes.

Project Jagriti is your India expansion, is that correct?

Yes, that's right. Can you ask your question?

We'll answer all that together. If you keep halting, it will take a long time.

Okay. Now when you speak about this disclosure that you gave out in this latest financial results that you're pausing on Project Jagriti, could you explain this properly, what's exactly happening?

What I really want to understand is after the pause, could you just give as of today the exact expansion that is happening without taking into consideration the pause? Sorry?

Hello?

No, please go ahead. I think there was someone who was unmuted.

Yeah. Could you please tell me the exact capex that's happening now on the Project Cuauhtémoc side, what has already happened, and on the Project Jagriti side, if you could split it, right?

What capex has already happened in both these projects, and what is being paused, how much capex has been paused in both these projects because you do not want to be too aggressive? Also, if you could speak about the products that are coming out of both these projects from the capex that's already happening right now and which is not being paused, and the revenue potential of it.

Yeah.

Thanks, Kaustubh. The project that is being paused is not Jagriti, it is the Cuauhtémoc project or the Guatemala project.

Basically because we felt that stabilizing Jagriti is important, and we need to devote all our energy and resources there. Both the projects are focused primarily on flexible packaging, which is fundamentally barrier-coated, functionalized paper used for different products that are multilayered, long shelf life kind of products.

The amount of capex we've spent in Cuauhtémoc, that includes our US expansion, is about Neetika, what would the exact figure be that has been capitalized or is CWIP?

I'll give you the exact number in a minute, but it's about ₹30-40 crores.

About $4 to $5 million USD is what has been spent. Our board had anyways restricted us to go beyond $10 million there.

That's the amount that has been spent, and all we are doing is to hold that project steady. There's a lot of work that has happened and a lot of effort that has gone in.

All that work remains with us, but we'll just hold it till Project Jagriti is stabilized, and then work towards moving back into Guatemala then.

You have ₹487 crores of CWIP, I can see as of September 2025 in your balance sheet. How much of that CWIP is paused?

Neetika, you want to take it up?

Sure. I'll give you a number or a background of how much we spent on Jagriti, and maybe then you can understand this better.

The Jagriti capex at present is about ₹500 crores. Of which a majority is actually in the CWIP, and we just have about ₹16 crores which is the creditors outstanding.

Rest of it is basically Cuauhtémoc. Jagriti is where the major spend is.

No, how much has been spent? How much is being spent in Jagriti?

All the ₹500 crores you're saying ₹500 crores capex is on Project Jagriti, is that what you're saying?

Exactly. Yes.

Out of that, nothing is being paused?

No. That's the one where we are focusing, right?

That's the reason.

How much has been spent, out of that ₹500 crores, how much has been spent?

That's the spend.

Sorry?

That is the spend. This is why it is in CWIP, right?

No, but correct, correct. When will that come on?

That will be July '26. That's what we declared in the last board meeting as well.

Okay. For Project Cuauhtémoc, the money you were going to raise from investors and from debt, and it was in your presentation, that was for Project Cuauhtémoc.

Are we pausing on Project Cuauhtémoc because you're not able to raise money from outside?

Ved, may I hand?

No, that's not the case. It is a factor of focus and energy.

I don't think we would have definitely gone ahead and raised. We had contracted with Rothschild, and they were very, very clear about raising the money.

We felt that our bandwidth is limited right now. We have in fact informed Rothschild that we need to hold on, complete Project Jagriti in India, and then come back to US, Guatemala.

It's not a question of whether we are being able to raise or not, it is a question of our bandwidth and focus.

Okay. Just last question.

You were talking about hiring a professional CEO, was that correct, last quarter? Or something on that regard, could you update on that?

Yeah. We have interviewed a lot of people.

We felt internally that it is better right now to function as a team that is already in place. I have situated myself from Ayodhya.

Neetika, me, and the team here has been working together to stabilize the operations, and we are developing people from within the organization.

There's no one going to be hired now? You're not looking anymore for external professional?

We remain open if somebody turns up, but amongst the people we've hired, we haven't found anyone. We felt that it is better to develop from within.

Okay. Thanks.

Thank you. Thank you, Kaustubh.

Mr. Ravi, you can go ahead and ask your question.

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

I basically have two questions. First is on NM.

I think in the last con-call, Ved had mentioned about some trials in England. Wanted to know where we are on that.

Basically, when PM4 comes, this July or June or whatever it is, are we going with NM as a coater, non-metallized, or are we looking at barrier-coated paper? Just if you can provide some more details, that will be helpful.

Absolutely. I'll just, again, brief you on the difference.

There are two kinds of coated or barrier-coated papers that we are doing: metallized and non-metallized. The metallized substrates we have been selling in smaller amounts, and non-metallized is what we've been working at.

There was a certain structure, like you remember well, that we had done a lot of trials in England. We had created a certain structure, floated it in the market, etc.

We have spent a lot of time in the market, and there is a significant shift that we find in terms of the sustainability commitments that people had taken. With the lack of pressure from outside, and that includes customers and government, we found that there is a step back from the companies.

Hence, what we are working on is to provide the right structure at the right value so that we can compare it apple to apple with the current polyethylene or BOPP structures. That's the work that is ongoing right now.

As far as the Project Jagriti goes, we're actually going to start with the base paper, which is basically what we call a greaseproof or a release paper, which is like the butter paper that goes on top of butter, or the kind of sticker behind the sticker, the release paper that goes on, which has umpteen applications. We're going to stabilize the machine initially for the first two, three months, and then add on the barrier-coated substrates within the next year.

Okay. Thank you.

Looks like we have taken a step back there as well. Anyway, my second question against Mr.

Ved on this upcoming calendar year, 2026. Although, you said we are on track, I feel, we're actually way off track from our past commitments.

There's been a lot of optimism since last three years. On many occasions, I think, management spoke about innovations on flexi packaging, trials with top FMCG players.

We also spoke about outsourcing. When you look at reality, you look at the numbers, I think we are still, at where we were probably 15 quarters back.

Stock price has nosedived, and we are probably at the 2021 levels. Can you please give a realistic view for 2026, can we achieve an output of say 10,000 tons per month by last quarter of this 2026 with Jagriti and outsourcing?

This, I believe, will give us at least ₹300 crores in a quarter. If you can give some realistic view on, neither pessimistic nor optimistic, about 2026.

You're definitely right on our optimism. We do find that we have made commitments and not lived up to them, and we are very aware of them.

We are going to make lesser commitments hereon and hopefully give you better results than what we promise. That's something that as a huddle we have kind of decided to tone down our optimism.

I definitely don't believe in realism, even till now, because otherwise, it's difficult to make the changes that we're looking to make in this world overall. We continue to work in that direction.

In terms of 10,000 tons, I don't think it is going to be 10,000 tons. When the Project Jagriti stabilizes, it's going to be about 3,500 to 4,000 tons from PM4.

The current paper machines produce around 4,000. We sell a little bit of pulp.

We're looking at about 8,000 to 9,000 ton trajectory in the next, I would say by the calendar year-end-ish. That is what I can kind of foresee for now us achieving.

Okay. Thank you.

Thank you. Ms.

Manali, you can go ahead with your question.

Hello. Hi, team.

My questions are broadly around the delivery range. I want to understand the kind of capex that is going to go in it, the kind of volumes that will come out of it, the pricing that it is going to be, and also in terms of the cost that we are incurring and the premiumization that we are looking at.

Further, what kind of customers is it going to be attracted to?

I'll take that. Thank you, Manali, for the question.

I'll start backward, right? The customers we are going for is essentially everywhere, from where you and I are ordering food online today.

For the most part, the food is coming in non-compostable solutions because often in the market there is a gap. We have not been able to provide the market or the restaurants with a solution where you can have a real compostable, leak-proof solution.

That is where we feel the innovation lies in the product we've made. The target audience is the entire delivery market, food delivery market in India, which, as is growing at a significant pace and will only kind of follow that trajectory, right?

That there is no segregation. The specific applications here will be everywhere where leakage was an issue, right?

All kind of gravy products will be where we are really offering innovation as compared to what exists in the market. In terms of the premiumization, yes, the product will be at a premium to what exists in the market.

Again, the way we are justifying this cost is that restaurants will also benefit in a lot of ways. Currently, the kind of effort that goes into packaging and the taping and the time it takes to pack that order, the issues that the restaurants may face in terms of leakages, complaints, experience, when you take kind of all of those factors and right, if it's compared apple to apple, surely there is a premium.

If you look at it 360 degrees, the gap is a lot smaller, right? Also, most of these delivery platforms, Zomato, Swiggy, and a few other such marketplaces, right, most of them have allowed restaurants to charge for extra packaging costs.

Correct? Now when you are ordering, you will see there is this line packing charges that kind of shows up, which is at the discretion of the restaurant.

Even though there is a pricing gap, for the restaurant, they have the ability now to pass it on, right? Even though there is a premium cost, we feel that and again, even if we take that out of the picture, like I explained to you, when you look at the whole 360-degree cost of packing, right, if you take into account the time that it takes to pack a traditional container by taping it 360 degrees, the time that it took, then the unwrapping experience, right, when you receive your order, then you're kind of untaping it, and the time it took, etc., right?

There's all those costs when you factor them in, and then the potential complaints that you may receive due to leakages, net-net, the difference kind of comes down significantly. Fair.

Thanks a lot. Thank you.

Thank you, Pranay. In terms of scale, we will be starting with approximately eight machines, which will be each producing close to 400 kg a day of product.

It's not just one product, it's a range of products. That will be kind of the initial output, and then as the market grows, we'll kind of keep adding to that.

Thank you. Jeet, over to you for your question.

Hello. Pranay, just one thing.

I think I was on mute. I just want to take forward with Shubham just what he had said.

If you could allow me. Please.

Sure. Go ahead.

Sorry. When I was speaking about, pricing, I want to understand again, I understand with what the intent with which the delivery range is coming in.

Just want to understand what is the kind of cost impact that also comes with it in terms of how expensive it is in comparison to other products and the readiness to take this product? Right.

Again, like I said, if we compare apple to apple, we are looking at around 25% to 30% premium. Again, you will have noticed recently the delivery segment is primarily Zomato, Swiggy, and a few other such marketplaces, right?

Most of them have allowed restaurants to charge for extra packaging costs. Correct?

Now when you are ordering, you will see there is this line packing charges that kind of shows up, which is at the discretion of the restaurant. Even though there is a pricing gap, for the restaurant, they have the ability now to pass it on, right?

Even though there is a premium cost, we feel that and again, even if we take that out of the picture, like I explained to you, when you look at the whole 360-degree cost of packing, right, if you take into account the time that it takes to pack a traditional container by taping it 360 degrees, the time that it took, then the unwrapping experience, right, when you receive your order, then you're kind of untaping it, and the time it took, etc., right? There's all those costs when you factor them in, and then the potential complaints that you may receive due to leakages, net-net, the difference kind of comes down significantly.

Fair. Thanks a lot.

Thank you. Thank you, Pranay.

Thank you. Thank you.

Jeet, you can go ahead with your question now.

Yeah. If I can get some clarity on the capex that has been incurred till date.

I think we've spoken about ₹500 cr, right, till date. Out of that, how much is funded via banks?

I'll give you a breakup, Jeet. Thanks for the question.

The total spend is ₹515. Total equity invested: ₹198.

Banks and loans: ₹308. Creditors escrow account balance: ₹8 cr.

It's a ₹515 that has already been committed to Project Jagriti.

The balance ₹175, ₹500 to ₹675. How much is the equity gap now?

Because you've postponed our project, right, by three, four quarters. We'll have those internal accruals coming in.

Initially in the last quarter, we had a gap of somewhere around ₹80-100. Now that gap has fallen to what number?

What is the timeline within which we need to infuse an external equity coming in over and above the accruals? Do we have any hard stop?

Yeah.

The total equity and internal accruals combined today stand at ₹198. With the escalation that we announced, I think that will have to be about ₹259.

We are looking at a gap of about ₹60 cr in the equity side. Yes, we plan to fund this through internal accruals and the equity from the promoters' side.

Timeline-wise, we would be doing it within the month of February and March, that's the target, because the major spend would be now for us to be able to initiate the project by 1st August.

From the balance ₹60, equity would be how much? Just a rough internal calculation.

How much can internal accruals give you from that ₹60, and how much external?

If I look at even if I keep the performance at, say, this quarter's level, we would be having about ₹20 cr of EBITDA available with us. The operational interest and the loan interest would be about ₹3 or ₹4 cr, and then the balance is available for investment.

Okay. My second question is around Guatemala, since you're pausing.

I just wanted to understand what happens to those bagasse contracts. Do we face any penalty, any financial penalty that comes into picture?

Number two, on the land ownership, right? We were speaking about 150 acres.

Do we own that piece of land, or even that is not come onto our books? Third part is, what do we do with Satish, Rolando, and the team over there?

Important questions, Jeet. Thank you.

The bagasse contract and the land contract have both been put in abeyance. We did have a penalty on both sides if we did not start picking up or they did not start giving by 2027.

We both met mutually. We met all the sugar companies.

We told them our focus on Jagriti, and we kind of did a kind of abeyance of the deal like, okay, we will write off this contract, and we'll say that we will renegotiate once Pakka is ready. That's been put on hold.

The land also, we had paid the advance and not the full amount. Only $140,000 had been paid.

There, again, we have said that, let us come back, and we will get into the land transaction again. All team members have now been basically informed them that 31st January is going to be the last working day.

We will not be paying salaries. Yes, Rolando does remain our legal representative and our person who operates the project in Guatemala.

For that, we will have some kind of a fee retainer kind of situation. Everybody else will be let go of for now until we restart later this year, hopefully.

Okay. I have more questions.

I will come back in the queue.

Thank you. Ms.

Neelu, you can ask your question.

Just to continue on what Jeet was asking, in the presentation of 11th November last year, you showed that you invested $8 million in the American project. Now just Neetika mentioned it's about ₹30 to ₹40 crores, so that's about $5 million max.

Is there a gap, or we'll bring back that money from US to India for our Jagriti

project? Thank you for your question.

The difference basically is that the amount that we have spent there would be sitting as an investment in our books, and that's the value that you quoted first. The question that was asked was how much has been shifted to CWIP.

That's what I answered, that that's about ₹30 crores. The difference is basically what is not recognized as an expense in their books, but from our side, it is an investment.

Can that be brought back to India for Jagriti? That's what is the question.

Because if there is a funding gap-

Unfortunately, no. That will not be possible because there has been certain expenditures which have been done which were necessary, and not necessarily every expense can be capitalized because it has to be directly related to the project.

There are certain IFRS and even US GAAP that would govern the definitions there. That difference would remain.

It will not be possible to get that money back.

Okay. No, one more thing.

We have a quarterly revenue of about ₹100 cr now presently, if you take broadly. Yes.

Once expansion is done, that will increase to ₹300 crores a quarter?

Broadly speaking, 100 tons per day, the price would range from about ₹110 to about ₹130. Yes, you could say that.

Okay. Thank you.

I'll get back in the queue.

Thank you. Nithin, you can ask your question.

Nithin.

Thanks for the opportunity. Congratulations for a rather okayish kind of results for this quarter.

My question regarding Ved Krishna kind of, our Chairman kind of told us that we are kind of putting an end to our expedition into Guatemala. If you could quantify what sort of impact is going to have on our P&L in the coming quarters because, ultimately, since the project has been shelved, some of these have to be provisioned, we'll have to make some sort of bad debt provisions as per the accounting standards, right?

Basically, what sort of impact do you think the shelving of the project is going to have on our P&L side, not just this quarter, but in the coming quarters, if you could have a quantified number on that?

It just depends on what happens in the next 6 to 9 months. Of course, it's a pause, it's not a shelving.

That's a very important clarification. That all the transactions that we have done in order to kind of give it a pause are very clearly stated that we are pausing.

After Jagriti is stabilized, we will come back and do it. All the relationships remain intact, all the work that has been done remains intact.

Yes, ultimately, we cannot keep paying the team, so, of course, we are asking them to find alternates, etc., etc. That said, Rolando, who was leading there, remains in one way or the other connected to us, and all the work that has been done remains.

If we don't manage to do it in the next 9 to 12 months, then we will have to take a call, of course. Before that, it's just a pause.

Neetika, if you have a further kind of clarification on that?

No, I'll leave it at that for now.

What sort of exposure are we looking at? I think Neetika kind of had spoken about a figure of something like $5 million.

That's basically what has been capitalized, right? What about the other expenses?

The salaries, all those, were they flowing through the P&L, or are they being capitalized as well?

It depends. Just to give you an example, I form a part of a support function.

My salary is not directly linked to Project Jagriti. When it is not directly linked, it will not be capitalized.

If I were somebody who was working in the project and working towards the project or the time that I spend only on the project, that gets capitalized.

Basically, the entire exposure would be somewhere like ₹60 to ₹70 crores at max?

Yes.

Got it. Coming to Jagriti, I think it's in the chat sir mentioned that repayment starts from next quarter.

Our entire exposure to the banks for Jagriti would be something like ₹390 crores, right?

The repayment starts in the quarter after the date of commissioning, not in the next quarter.

In the initial year, what is the repayment schedule like? In the initial year, what are the terms of the loan agreement?

It will be split across 15 to 18 quarters, and that's how the repayment is planned. It starts from the quarter after the date of commissioning.

For example, when we say August, it will start only from December. The quarter post the date of commissioning.

Just to get things right, what sort of repayment are you looking at in the initial years, if you could quantify that?

I think it will be about 20 or ₹20 cr per quarter, but let me just get that number to you. I'll answer that to you in the chat.

Sure. Thanks a lot.

Thank you.

Thank you.

Jeet, if you had another question?

I just wanted to understand from ordering a coater, do we attach any timelines to us doing that? Because we'll be starting PM4, right?

If that doesn't happen, what kind of numbers are we looking for greaseproof? What are the pricing right now for a greaseproof in the market right now?

Because our project is clearly not going to be very feasible, right, considering only greaseproof. For coater, have we decided if flexi doesn't happen, then anything on barrier application that we earlier spoke about?

What are your thought process around making this project more feasible?

Just let me clarify. Project remains feasible even with base paper, Jeet.

We have a decent EBITDA value, and we will be able to sustain. Yes, that's not what we are in for.

We, of course, want to create barrier-coated functionalized papers. I would actually go the other way, and I would say that actually thank goodness we haven't ordered a coater, because what I'm finding in the market is there is a significant resistance to any cost increase right now.

I've spent a lot of time in the marketplace with converters, with brands, and what we find is that because of the lack of push from the government and the public, people have kind of backpedaled, not just on compostables, but also on such mono-layer structures, what they call metallized BOPP or something which people had created. That actually makes our life much more interesting because now we have to provide a better performance as well as the right value.

Both those things become important. We are continuing to work on it.

We have kind of refocused our energies towards applications like tea bags, bag-in-box, etc., like what you've been asking, there are the applications that you look at, rather than it being the primary product for packaging for say, even a chocolate or a cracker or something where there is the singular packaging. We feel that with a protective layer outside, that is going to work better.

What we are trying to do is to find ways to get the right formulation in place so that the value as well as the performance is both taken care of. That's what the team is working on right now, but we remain very confident.

The price range is going to be what Neetika said earlier, ₹110 to ₹130-140, if we are to do that segment of dense papers like release base, greaseproof, parchment. That's one family of products that is primarily imported into the country right now.

Greaseproof is now made in the country as well, but a lot of the other products are being imported. We will remain feasible at that, but we will not remain as joyful as we would like to be on that.

Continue to work towards it. There are challenges.

We will be very upfront about it. We're also working on overcoming those challenges.

Okay. The last question is, in the last quarter when we spoke about raising funds, you showed an intent of infusing, when I think the 90-day average of the stock price was somewhere around 150, and you mentioned doing it at even premium to that particular number.

Now, given that averages would have come down, and if you were to infuse, say, in the next couple of months, would that number still come down, or looking at the company's dilution angle, would you still stick to that particular number of infusing at probably something more than 150?

We have very deep belief in the organization, we will do whatever we feel is the best possible number. We find that the share price is heavily undervalued right now.

We do think that we do need to infuse more confidence in investors, and we will work towards that. What the exact number is going to be and how much, that's something that we are still working out.

Thank you.

Thank you. If there are no more questions, we'll conclude the call.

Over to you, Ved, for closing comments.

Thank you all so much, as always, for remaining supportive and confident about the company. As a team, we are continuously working to ensure that all the promises that have been made are being fulfilled.

We remain very optimistic and excited about the coming few quarters, and we look forward to getting a more structured in place in terms of communication, as Sachin mentioned in the beginning. Thank you all again for your confidence, and thank you to the team for exemplary work.

Thank you so much.

Thank you. Thank you, everyone.