Thank you. Good afternoon, everyone, and thank you for joining Privi Speciality Chemicals FY27 earnings conference call.

FY27 marks another important year in Privi's growth journey. Our focus remains on executing the expansion projects currently underway, expanding our specialty product portfolio, and further building on the longstanding relationships with customers across the globe.

The first quarter reflects a very positive start of the year. Our business continues to benefit from the confidence that global customers place in Privi's manufacturing capabilities and ability to consistently deliver high-quality products.

These enduring customer relationships remain one of our key strengths and continue to support our growth across existing products and new business opportunities. With that, I will now request Sanjeev to take you through the operational highlights of the quarter.

Thank you, sir. Good afternoon, everyone.

Q1 of FY27 has been an encouraging start for the year. During the quarter, company reported revenue of ₹666 crore, which reflecting growth of 19.22% year-on-year, supported by healthy demand across both domestic and international markets.

Despite adverse global headwinds, demand across the fragrance and flavor value chain remained healthy during the quarter. Global customers continue to focus on supply chain diversification and dependable sourcing, while premiumization and innovation across end-to-end user category continue to support demand for specialty aroma ingredients.

These structural trends continue to create opportunities for companies with differentiated manufacturing capabilities, diversified sourcing, and strong execution capabilities like our company. Operationally, we continued to execute our expansion roadmap during the quarter.

The balanced manufacturing base, together with our sourcing flexibility across both processes, remains an important competitive advantage, enabling us to optimize raw material procurement while ensuring reliable supplies to our global customer base. Our product development pipeline also continues to progress well.

We're advancing several high-value specialty molecules like maltol, ethyl maltol, ethylene brassylate, musty as we call it, cyclopentadecanone. Further, our long-term roadmap envisages introduction of 10 advanced specialty products as part of our Phase 2 and Phase 3 expansion program.

The joint venture, Prigiv, also continued to make steady progress during the quarter. Following the achievement of profitability in Q4 FY26, we remain focused on scaling the business further, supported by plant capacity additions with infusion of additional equity, as you all know, and development of high-value specialty molecules further.

Operationally, our supply chain remains stable, despite the evolving global geopolitical environment. Our diversified sourcing strategy, particularly our backward integration into fine chemistry and global raw material procurement network, continues to provide resilience and flexibility in managing input availability and customer deliveries.

This has enabled us to consistently meet customer requirements across key markets. Looking ahead, our focus remains on disciplined execution of ongoing expansion program, progressing the specialty product pipeline, and further enhancing our position as a preferred global partner in aroma and specialty chemicals.

With that, I now hand over to Mr. Narayan Iyer, our CFO, to take you further into financial details.

Thank you.

Good evening to all, and thank you, Sanjeev, and thank you, Mahesh bhai, and a very, very warm welcome to all of you. We are pleased to report and start the financial year 2026-27 with strong financial performance delivered in a dynamic and evolving macro environment.

Our performance reflects strong execution, disciplined cost management, and continued strength of our diversified product portfolio. Our performance for the quarter highlights our ability to protect profitability across cycles and reinforces our confidence in the structural strength of our operations and the organization.

Key highlights for the quarter which has gone by: We reported strong growth despite subdued market. A 19.22% revenue growth was reported during this quarter on a year-on-year basis comparison.

We delivered around 25% margins consistently now across the last nine quarters. The EBITDA margins are expected to sustain at a 20%+ driven by the operational efficiencies and improved product mix and increased capacities going to come forward in the near future and in the coming years.

Our JV with Prigiv is progressing as per expectations, and we expect meaningful contributions to keep coming ahead. On the capex update, as Sanjeev mentioned, our Phase 1 of production capacity expansion is progressing as planned and is expected to be commercialized shortly.

This shall increase our production capacity from 48,000 to 54,000 metric tons of all our existing products. Phase 2 and 3 of the multi-specialty aroma chemicals project is also progressing as planned.

Additionally, during the year, and more so during the quarter, we continued to make progress on the proposed merger of Privi Speciality Chemicals Limited, Privi Fine Sciences Private Limited, and Privi Biotechnologies Private Limited. This consolidation is aimed at simplifying the group structure, enhancing operational synergies, improving scalability, and creating a more integrated platform for future growth.

Members may note that we are pleased to share that the company has filed the scheme with the NCLT post receipt of observation letters from both the stock exchanges with a no objection, this marking an important milestone in the merger process. We expect the merger to be completed in this financial year.

Now coming to key financial highlights for the quarter 2026-27 quarter one: The total income that was achieved on a consolidated basis for the quarter was around ₹681.42 crore, which indicates a growth of 20.01% on a year on year basis. The EBITDA achieved during the said period was ₹167.47 crore, registering a growth of 18.73% on a year-on-year basis.

EBITDA margins were at around 24.58% for the quarter, and we expect, as mentioned, EBITDA margins to be almost similar in the near future. Profit after tax for the quarter was around ₹83.2 crore as against ₹61.46 crore achieved in Q1 of 2025-26.

The overall growth continues to be driven by volume, price increase, and improved product mix. This growth was supported by sustained demand across key end-user industries and increasing traction in our specialty and value-added product segments.

While input costs remained volatile during the quarter, we continued to focus on operational efficiencies, cost optimization initiatives, and improved capacity utilization, which supported margin resilience. We have been able to bring down the manufacturing and other administrative expenses, which has enabled to improve the margins.

Giving a key highlight on balance sheet: We continue to maintain a very prudent capital structure. I am very happy to inform that due to the excellent management and constant monitoring and focus, we have been able to bring down our overall working capital cycle in this quarter to a 108 days during the period as against 141 in the previous year.

Our net debt as on June 2026 was ₹865 crore. This is net of cash and surplus money deployed in mutual funds, with a net-debt-to-EBITDA ratio of 1.29, reflecting our focus on maintaining financial flexibility while supporting growth investments.

Our net-debt-to-equity ratio was a very sound, healthy 0.57, reflecting good generation of profits. Our ROE and ROCE achieved during the quarter was 21.7% and 22.72% respectively.

Looking ahead, we remain confident in our ability to deliver sustainable growth. Our strong balance sheet, robust cash flows, and disciplined capital allocation strategy position us well to capitalize on emerging opportunities while navigating external uncertainties.

With the planned capacity expansion of existing products and the introduction of new specialty products, we have established a clear roadmap and are on track to achieve the vision envisaged by our honorable Chairman and Managing Director, Mr. Mahesh Babani, the vision of ₹5,000 crore in revenue and ₹1,000 crore+ of EBITDA over the next three to four years, representing a growth of about 2x.

With this, I would like to conclude now and ask the moderator to open the floor for question and answers.

Very good afternoon. Am I audible?

Yeah.

Thanks a lot for the opportunity. My first question was—

Can you be a bit louder?

Yeah. Is it better?

Could be better if you're a bit louder.

Sure. Our gross margin came in at 44.2% in Q1 FY27 versus almost 51% in last year Q1 FY26, which is a decline of about 650 basis points, even as the revenue grew by 20%.

What drove the compression, and how much of it do you expect to recover over the balance of FY27? Also in Phase 1 capex completion in mid-August 2026 and commissioning thereafter, should we read that FY27 growth will more likely be back-ended towards H2 of this year?

Thank you. This is Narayan here replying to it.

Your observation with regard to the RMC percentage consumption, there being about 4% is true. I would like to take you back to last year where we had stated that we had the advantage of low-cost raw material and the high cost of selling prices which we were able to get during the calendar year 2025.

On an average, we had also mentioned that the RMC percentage on the sales will be between the range of 52%, 53% to 55%. See, you also have to understand we import CST and GTO from across the globe and across various periods and various cycles.

There could always be the usage of the mix that may come about by which there could be about a few percentage here and there on the raw material pricing impact.

Vivek, look, Sanjeev here. We make over 75 products, and which are based on almost 60 different raw materials.

Sometimes the raw material cost could be substantially skewed, but overall, as Narayan mentioned, that between 52% to 53% is what we are looking at. What you should also see is how much we have saved on other expenses.

As the volumes grow and as the value grow, economies of scale do set in, and overall we are able to not only maintain EBITDA margin, but even subsequent from EBITDA to PAT, we are able to maintain that as well because the impact of depreciation as well as interest also has come down. We see that EBITDA of around 24% what we achieved is about 24 point some percentage point.6 or something, but 24% and more nearing to 25% is definitely on the cards going forward.

Does that answer your question, Vivek?

Yes, sir, it does. Thanks a lot for that.

My second question was in FY26 annual report, in the Chairman's statement on page number 17, it indicates that the capacity rising from 48,000 tons today to 66,000 tons by June of 2027, which is divided into Phase 1 increasing to 54,000 ton and Phase 2 increasing to 66,000 ton by September of 2027. Which Phase 2 date is correct?

Is it June of 2027 or September of 2027? Also, are we on track for Phase 2 capex, or should we expect some delay, just like Phase 1?

In light of the above questions, would you like to revise your overall guidance for FY27?

First let me answer your last question. No change in guidance.

Guidance do remain what we have said. We will achieve 5k, 1k in the promised time.

That's first and foremost. Secondly, in terms of implementing our projects, we are on time and things are going on.

It could happen for a week or two you may not have any activity if it rains too much. On the overall, the projects are being planned and being executed right now to deliver the growth that we have promised to all of you.

That's the first thing. About the capacity expansion, the current flagship product expansion will happen in the course of next 15 days or so.

From 48, as Narayan said in his opening remark, from 48 will go to 54.

One last line I would like to make as chairman, we are confident of achieving 20% maintaining 20% CAGR with similar EBITDA margins. Means you can understand what I'm trying to say.

I don't want to speak numbers. What last year's number, multiply by 20%, again you multiply by 20%, that will be the minimum achieving that target.

Thank you, sir, for the confidence, but just again a small clarification in terms of when would the 66,000 capacity be coming live, in June of 2027 or in September of 2027? Just a small clarification.

No.

Let me clarify this. First and foremost, the 6,000 metric tons of capacity was to come by June 2026 will now come by September 2026 is what we are saying.

From 54 to 66,000 metric tons, the balance 12,000 metric tons with regard to the Phase 2 capex, that's what we are trying to say, that by September 2027, the Phase 2 will be completed. I hope I am clear now?

Yes, sir. Very much.

The next question was on the bio-based pilot plant. What specific operating metrics like conversion yield or product purity, cost per kg, etc., will decide whether or not the company will move from a pilot plant to a commercial scale, and what is the minimum ROCE that is being kept in mind and targeted for these projects?

Okay. We have been progressing very well in terms of conversion of biomass into several value-added products.

A lot of patents are being filed now. What we are doing is we are putting up a demonstration plant, as we had covered in the last conference call.

We are putting up a demonstration plant in Navi Mumbai, which would handle about 2 tons of biomass per day, which is sizable quantity, which will then help us in terms of subsequent scale-up. Right now, we process about few hundred kilograms every fortnight or so.

We will be putting up 2 tons per day bio pilot plant, which will produce all the molecules that we are looking at, and that would kind of, as it says, demonstration and then proof of the concept would be given. That's what we are looking at.

Investment in this is subsequent to the 5k, 1k plan. This is something that would happen probably after we put up the plant, which would take about 12 months to 15 months, and once it is commissioned, we'll probably run it for a year to study all the nuances of manufacturing, and then we'll go for the large-scale plant.

We are at the moment very confident about the entire commercial profitability of this venture.

One closing remark I would like to give, Sanjeev, about this particular case, that in the 5,000 crore roadmap, this is nowhere part of the story. The part of the story will come future on after this 5,000 crore, the biomass project will kick in.

This will be first two, three years will be more learning, scale-up, doing homework for the future, beyond 5k. I hope you understood?

Understood. The last question, if you could throw some light in terms of how do we benchmark against the peers in terms of process efficiency, that will be very helpful.

Thank you.

That's an ongoing process, and we continue to work that. There is not a single day when it is not reviewed at the highest level.

We continue to strive because we always have believed and have proven that money lies within. Therefore, we continue to work every single day on improving the processes, reducing the steam cost, and doing all of that.

We continue to focus on that.

Thanks a lot, sir, for patiently answering my questions, and all the very best. Thank you.

Hello.

My first question is regarding the revenue contribution from the Prigiv JV. How much was it during Q1, and what was the EBITDA generated from the JV?

You want to understand about Prigiv?

Prigiv JV, yeah.

Prigiv,

the revenue generated was about ₹18 crore, and EBITDA generated was about 14%, 15%.

Right. Yes, and my second question was regarding our understanding that alpha-pinene prices have risen by 70%, 80% in last five months.

How much of that we have benefited from the price increase, and how do we see the prices of alpha-pinene going ahead?

If I would have known that, I would have been a billionaire myself, but no one can actually predict alpha-pinene prices. The good news is, and as we always keep saying, that when we do CST procurement, we do the back-to-back contract with our customers, and that is what helps us.

To that extent, we are covered in terms of our CST and back-to-back with our customers also. As far as the balance alpha-pinene that is made from GTO, the prices are right now at a high level.

There are both views. Some views say that the prices may still go further, but they are at historic high.

That fact remains. We are able to pass on those costs to our customers.

Right, sir. Sir, if you can share the breakup of revenue in terms of volume growth and realizations, that would be helpful.

We've not been giving volume growth on quarter-on-quarter basis, we will give you at the end of the year. It's a good mix of all the pricing, because product mix

It's all-round growth, Nirav. Let's not get into nitty-gritties, but it's an all-round growth overall.

As I mentioned in the opening remark, it's a mix of product, increase in prices, as well as a increase in the volume. Right.

Sir, what is the status of the merger of Privi Fine Sciences with Privi Speciality?

Sir, it will happen by this year-end. The good news that has happened in this quarter is that we have been able to file the application with NCLT.

We have progressed in this quarter very well in that.

Right, sir. Thank you so much.

That

was from my side. Welcome.

Hello?

Hello?

Hello. Am I audible?

Yes. Congratulations on the performance.

I have two questions. One is, the cost of raw material and inventory has been increased as compared to the previous quarter.

Can you give some highlights on that? The second is, the industry, especially camphor market, taking the demand-supply mismatch with significant new camphor manufacturing capacities that have been come up in India.

I also like to have comments on that.

Manisha, I think the first question I just answered with regard to cost of raw material. It's actually a mix of various things, but last quarter, for the same period, we had some advantage of low-cost raw material and increase in the product and the selling prices for the contracts for the calendar year '25.

Plus a good product mix was also there. You need to look that in Q2, Q3, Q4, the RM percentage vis-a-vis the sale was higher than what it is currently.

We are on line with that between 52% to 54% that we always talk about what could be the RMC as a percentage on sales. Lastly, I've always been telling that do not look at Privi on a quarter-on-quarter basis.

We need to look it into as a yearly basis, because the contracts that we enter is on an annual basis. There are back-to-back contracts that we have.

Therefore, you will find us the RMC tend to be around starting with and with regard to camphor sales and camphor Sorry, there was some background

Hello?

There is a lot of background noise.

Hello? I was saying there was some mismatch in the import manufacturing capacities that have been come up to India for the camphor manufacturing, which has increased the prices of camphor.

In that regard, I wanted to know the highlights from you.

Okay. Camphor, there were always number of players who make camphor, but their source of making camphor is based out of gum turpentine oil, which is very volatile in terms of pricing, whereas we make it from CST root, and it's a very small percentage of our overall revenue.

It's not a important product. We sell on our terms.

We do not really to sell

Manisha, the most important thing is that, for us, camphor is one out

of 75.

For many others, it could be the product. That's why we do not give so much of importance to camphor per se in our overall portfolio.

Fine. Thanks.

It's about 5% to 6% of our total revenue, we bother up to a point, but we don't.

Hello. Am I audible?

Yeah. Just be slightly louder.

Sir, I have a question regarding revenue mix, which molecules contribute to the major portion of our revenue?

Pine continues to be the main contributor.

Can you specify the name? It's

As you are aware, we have stopped giving this mix of product mix and product segments and all. This is as per the board directive.

The important thing is that, it's a complete product mix that we are selling, and all our product and our capacities are close to 90% of the installed capacities that we have. You should understand that.

What are capacity utilization right now?

Around 90%.

Sir, 90%. Thank you.

Hello? Hello.

on great set of results. Sir, I have two questions.

First is, due to the Iran war, impact of raw material prices, effect on profitability, and how you manage? Second is, what is percentage of camphor segment in your total business, and it is increased month-to-month basis or it is still same?

Yeah. With regard to the Iran war, there has not been too much of an impact on our RM percentage consumption, in fact.

Because crude as a segment and the product that we do is very, very limited, in fact. Predominantly it is non-crude items that we manufacture.

Really we've not been impacted because of the war that has been going around. Your second question with regard to camphor forming a part of our overall portfolio, as Sanjeev rightly currently mentioned, it is between the range of 4% to 5% broadly on the total turnover that we do.

Last, you asked for the capacities that we are operating around. It is around 90% or so.

I hope I've been able to answer you, Mr. Rajesh?

Thank you, sir. Thanks a lot.

Welcome.

Good afternoon, sir, and congratulations on good set of numbers. I just wanted some clarity on the capacity.

Our expansion plans are up to 70,000 metric ton, but post-merger, what would be our capacity? Combining Privi Fine Sciences, what kind of capacity we can see?

Further, we are not currently looking for furfural backward integration, but Privi Fine Sciences have certain capabilities for backward integration. How are we looking to backward integrate for furfural as well going forward?

If you can shed some light on that.

Okay. Thank you, sir.

To answer your first question, that post-merger what will be the volume that gets added, it is close to about 6,000 metric ton that get added to the Privi portfolio. Second, your question whether Privi Fine Sciences has a backward integration for the product that it is manufacturing, currently no, sir, because it's in a different set of chemistry.

The raw materials are available, and there is good margins available on that, in fact. Maybe going forward in future, we can always consider once it becomes a part of the Privi portfolio.

The addition would be around 6,000 metric ton, right, sir? That's correct.

That's correct.

That's correct.

Also, sir, on our Prigiv joint venture, what kind of capabilities from the chemical know-how and process know-how that we have get that building out that we can utilize for our other client base as well, which are also good in the flavors and in the fragrance segment? I'll tell you,

we don't really speak much about our technical details, but, over the years, we have mastered almost all kind of chemical reactions, and those are platforms on which we are working. We are particularly good at hydrogenation, for example.

We're extremely good at distillation. We also do a lot of other separations as well, which normally are not been done by other chemical manufacturers.

We do that. We also do a lot of Grignard reaction.

All on these chemistries we do, and that is what helps us in terms of overall looking at newer molecules as well. Other thing that we also do well is the environmental treatment, we ensure that it is zero liquid discharge.

In that area also we have substantial expertise in terms of treating all the effluents and ensuring that it is zero liquid discharge. These are platforms that we have.

There are a couple of more which I would not like to at this stage disclose, but there are some more, apart from biotechnologies, there are some more technologies that we are working on, which are really breakthrough technologies, which, in the due course of time, probably over the next 12 to 15 months, we will talk about those.

Okay. Thank you so much, sir.

Just one more last thing: are we looking for a similar kind of joint ventures, more joint ventures and partnerships?

Sorry, sir?

Are we looking for more this kind of joint ventures and partnerships with some These are

very, very tightropes to walk on. We'll have strategic alliances, but not joint ventures.

We'll have strategic alliances. We have two underway, but joint ventures become very, very tightropes to walk on, because one customer feels you're favoring the other.

Now we're going to do strategic alliance instead of joint venture. Of course, we have two strategic alliances underway.

Okay. Thank you so much, sir.

Hello?

Aniket.

Hello. Am I audible, sir?

You are.

Congratulations on a good set of numbers, sir, and thank you for the opportunity. My question, most of my questions were answered, but I would like to ask, what kind of a funding split are we looking when we are about to start the Phase 2 and Phase 3 capex?

I just wanted to ask about that. Okay.

As far as the funding part is concerned, since we have mentioned and it's there on the public domain that Phase 2 we have already commenced and Phase 3 we will commence somewhere around end of this year or early next year or so. Broad guidelines given is it will be prima facie done through internal accruals, and as and when needed, maybe we will borrow from the banks or from whatever institutions are available at very competitive prices.

Even after having said that, you would see that our ratios pertaining to debt-to-EBITDA and debt-to-equity, they all shall be very closely monitored and be much, much below the so-called thresholds that normally people prefer to be around.

Okay. Understood, sir.

Thank you so much. My second question would be, can you just explain up to what extent are we looking for adding continuous flow chemistry, or is it being used across the manufacturing processes, or are there any opportunities to increase the adoption, and particularly for the new molecules?

Yeah. For the existing molecule also, because each molecule involved between three to four chemical reactions.

In some cases, for example, we may be continuous on two, we are trying to do all of them continuous. Distillation, most of our distillations are now continuous, and we are in the upcoming projects as well, we are trying to see wherever possible, we are trying to start with continuous manufacturing for a large-scale molecules like maltols and all that.

For specialty molecules, obviously it can't be continuous, but otherwise we are working on continuous chemistry on ongoing basis. It's a good point to see.

Yeah.

Thank you so much, sir. That's really good to hear.

That's all from my end. Thank you, sir.

Thank you.

Hi. Good evening.

Am I audible?

Yeah. My first question is, what percentage of our raw materials are crude-based, and how has this impacted the pricing?

Okay. As just mentioned earlier, this is Narayan here answering you, crude-based raw material forms about close to 15% to 18% of the overall purchases that we do.

Okay. Can you please tell us what amount of capex that we will be incurring this year and also the next two years?

Okay. The broad outline for this year and following two years, it could be around in the range of ₹850 to ₹900 crore or so.

That's the capex that is outlined, which will ensure Phase 2 and Phase 3 completion, in fact.

Okay. Can you talk more about your new products and the new initiatives over and above the 5k, 1k plan?

Also, what is the progress in our furfural products? At what stage are we in currently?

Our new 5k, 1k story starting from about 2,500 crore that we closed last year, out of that, if you see your investor presentation on slide number

18,

we have these details, wherein they are given previous investor presentation, yeah. In which we have given these things.

Essentially we are looking at three arms to this growth: One is chemistry which is based out of furfural, which is the building block which is made from corn cob. We would be the only company, fully integrated from cob up to making of molecules like maltol, ethyl maltol, and cyclopentadecanone.

That would add about 1,000 crore and more to the revenue in this vertical. We are also looking at a molecule called musk T or ethyl brassylate, and then there are about 10 specialty molecules, 10 perhaps 11, and these molecules, of course, we are not putting any names to these ones right now because of obvious reasons.

Though all these plants are right now under implementation. We are expecting that by about middle of next year, they would be mechanically completed, and we expect that H2 of next financial year, we should start getting contributions from these plants, so that we are on our track to achieve 5k, 1k plans that we have made, that is 5,000 crore of revenue and over 1,000 crore of EBITDA, 1,000+ EBITDA.

Okay.

Understood, sir. Understood.

Thank you for the opportunity.

Hi. Am I audible?

Yeah.

Thanks for the opportunity, and congrats on a good set of numbers. My question is on the capex plan.

If I'm not wrong, you have three broad capex plans that you have mentioned in the previous presentations, which is on the existing side, you have some 300 crore of capex for the new products, 300 crore of capex, which is supposed to be closed which you clarified in next year, H2 of next year, and then another 300 crore of capex, which is for new specialty products. Is my understanding right?

That's correct.

Okay. The existing product capex, you're saying, is sort of delayed slightly, and now it will happen in September of this year, right?

Yes. That's correct, Mr.

James.

Yeah. Thanks.

Just to harp a little bit more on the new products side, which the previous participant also alluded to, what will be the these two products, basically maltol as well as the musk T, what is the opportunity? Whom will you be supplying to?

I understand one is for flavor and the other is fragrance and all that. Can you give a little bit more color on the market opportunity, the sort of customers who would be supplying?

Maltol and ethyl maltol both are right now made, I would say over 95% it is manufactured only in China. It's an obvious China plus one post where we stand to achieve India as a source for manufacturing this.

India imports significant amount of ethyl maltol. It's used in making pharmaceuticals, and we are in touch with most of these customers.

They would be very happy to procure it from us. Maltol as such is actually used as a flavor, all the Ovaltine, all the chocolates, biscuits that you eat, that has maltol, it has that milky flavor that you get is from maltol.

We are putting up a capacity which would represent almost as per our normal strategy, 1/4 of the global opportunity, and we are confident that, given that, this will be consumed by our existing customers, and we would be the only company which would be fully backward integrated, only company globally, starting from cob right up to making maltol, ethyl maltols, and few other products. Therefore, we would have substantial competitive advantage in terms of manufacturing costs and everything, and that's what gives us assurance that we will be able to scale up our revenues pretty quickly.

Sure. That's great to hear.

This will be a similar play to your crude sulfate turpentine as well. It's like a waste-to-wealth kind of a strategy.

You are saying you're the only company in the world which has got this technology to sort of convert corn-on-the-cob to maltol?

Okay. There are a number of companies there are multiple ways of converting cob into furfural, okay, and there are n number of companies in China who process and produce furfural, which has a lot of other applications as well.

Furfural production is over few lakh tons. There are umpteen number of companies in China which process furfural, and they sell that furfural.

There are companies which make maltol in China, which then procure that furfural. What I am saying is, we will be the only company which will start from cob, make furfural, and for that also we have a slightly different technology, superior technology.

That's what our advantage would be.

Fine. Just another last question on the Prigiv JV: What sort of products are you targeting in that Prigiv JV?

Is it more to do with supply towards Prigiv, or how does that product portfolio

Mr. James, we have a agreement of nondisclosure, I will not be able to give too much of details on that.

Whatever is manufactured in the JV will be exclusively sold to Givaudan.

Okay.

There are 42 products, and you can see their confidence in the joint venture by the fact that, together, we have decided to invest additional ₹50 crore in equity for next phase of expansion.

Okay. Cool, thanks.

Thanks for the answers, and all the best.

Hello. Am I audible?

Yes, please.

I just wanted to ask about the crisis happening in the Red Sea currently, I think related to the Houthis. Do you guys see your freight cost increasing in the next couple quarters, or how are you tackling this issue?

See,

Red Sea impact now has been for quite a number of years, and we have been sailing through that impact. Now I can only say that.

With regard to freight expenses on account of the Hormuz Strait, we've not been too much impacted on that, but Red Sea continues to be as it is. Do you have anything specific to get it clarified?

No, sir, just wanted to

challenges that

margins will be affected.

No. We don't find any such challenges as of now.

Okay. Thank you, sir.

Hello. Am I audible?

Thank you for taking my question again. I just wanted one clarity on the maltols part.

It will be a flavor molecule and it will go into probably pharmaceutical application. There will be approvals that will be required.

What will be the approval timeline and the process that you can share on that?

There are two maltols, Krish: one is ethyl maltol, one is maltol. One of this goes for pharma application, but as this is an intermediate, therefore it doesn't typically require any approval.

As far as the other one, maltol is concerned, that goes for flavor, our plants are designed as per GMP standards. We will be getting good manufacturing practices certification to sell those products, because it's a flavor.

Understood. Just one more question on the strategic alliance that you mentioned.

Can you share some light on what would be the scope of that strategic alliance, and what would be the purpose of that strategic alliance?

Currently, we are not in a position to disclose too much of that, at the appropriate time we will announce. These would be typically, let's say one or two specific molecules that our customers may ask us to do exclusively for them.

That's what we'll work on.

Sir. Thank you so much.

Thanks, Krish.

Thank you. On behalf of Privi Speciality Chemicals Limited and the management, and on behalf of Mr.

Mahesh Babani, I thank all of you investors, shareholders of the company, and every person attending this particular call for having taken the time out. Thank you, and it was a pleasure interacting with all of you, and look forward to interact very shortly soon.

Good day. Thank you.