Good afternoon everyone. On behalf of Equirus Securities, I welcome you all to the Q3 FY26 post earnings conference call of Rolex Rings.

From the management side, we have Mr. Manesh Madeka, Chairman and Managing Director, Mr.

Mihir Madeka, and Mr. Hiren Doshi.

Without further ado, I would like to hand over the call for opening remarks, post which we can have a Q&A session. Over to you, Hiren.

Thank you, Mihir. We at Rolex acknowledge the efforts of team Equirus for arranging this call for the earning updates for the quarter ended and period ended on 31st December 2025.

Warm good afternoon to all the participants. Thank you very much for spending your valuable time.

I welcome you all. Before taking you through the numbers, would like to appraise the overall business outlook, management perception for the proximate future.

As you all are aware that recently the US has came out or rather declared the US tariff, US India tariff deal, and announced that they have reduced to the import duties to at 18% where it was 50% in the cases. Would like to update over here that particularly what they have in notification what it has been issued by the US Gazette and US Customs or from the President's office, that they have removed this Russian oil penalty which was levied in the somewhere in August 2025 by particular proclamation.

That particular notification is being withdrawn. Now effectively today is the first, rather you can say, a working day at US post announcement of this tariff structure.

We are yet to get the final inputs or final outcome that how it would be 18% or what would be the rate on our products at US. Because in November '25, the reciprocal this Russian oil penalty has already been moved off from the particularly the products or for used for medium and heavy-duty vehicles, parts for the medium and heavy-duty vehicles.

Till now, or rather from 1st November onwards, we have been charged 25% duty apart from the regular base structure of 3%. Now it's yet to see how this 25% would come down to 18% or how it would be effective.

Again, almost 40%, 43% of the days of the current or last quarter of this fiscal has already been passed when this announcement made. There would be an hardly a positive or rather pushing moment for this particular last quarter of this fiscal.

We are very much positive from the first quarter of FY27 that now things would be on a very streamline and US would be on track. Because till now, for last 6 to 8 months, customers are pretty much in the state of the wait and watch kind of situation.

They have hold on the entire or rather more than 50% of their imports, and they were not able to, rather their customers are also not giving that feedback, and entire chain has already been disturbed. We expect that hurdle to be overcome in the from the first quarter of next fiscal, that is April '26 onwards, and we hope that we will be on track or rather US would be on a moving positively from the next fiscal.

Coming to the quarterly numbers for the quarter ended December or rather Q3 of FY26, would like to tell you that there is a positive movement in auto components in both the front, domestic as well as export. Would like to tell that over quarter two, we had a growth of almost 14% on the auto component revenue in this Q3.

Same in case of bearing rings, we had a degrowth of 7.5% over quarter two. Further to drill down this improvement, there is almost 10% incremental revenue in Europe exports over quarter two, and which is you can say almost 25% compared to my FY25 full numbers with the 9-month number percent.

I'm talking in terms of percentage. There is a good movement and momentum at European market where we were struggling till last fiscal.

In the domestic front also, it is almost 5% to 6% upward trend compared to Q2 of this fiscal and vis-a-vis 15% improvement over the entire fiscal of fiscal '25. The only worry or rather the where we got an hit is in the US market, wherein 10% downfall in the Q3 compared to Q2, and if we annualize it, it is almost 30% down in compared to fiscal '25 what we had.

US is still under the shadow of tariff deal, and now we expect some kind of U-turn of this downfall from the Q1 of FY27. On the other hand, as I told that domestic and European markets have hit the positive curve and expect it to be continue to be improved from the first quarter onwards.

On the basis of the program, on the basis of the orders what we have received, forecast we have been given by the customer, we are very much positive as far as fiscal '27 is concerned. In this last quarter, a couple of new customers have already been enrolled or rather it has SOP has been started, though at a marginal level, but down the line from the Q1 of fiscal '27 it would be ramped up and further it would be increased.

Now taking you to the numbers for the Q3 as well as 9 months for this current fiscal. Revenue from the operations for the Q3 of this current fiscal, it has touched almost ₹275 crore, which was ₹271 crore in the last quarter vis-a-vis ₹260 crore of the same quarter in the corresponding previous year, that is December '24.

Here we had a growth of almost 10% in 6% to 8%, 7% on Q3 of FY25 versus Q3 of FY26. Compared to the previous quarter, we had a marginal growth of a couple of percentage only.

In terms of EBITDA, we are maintaining, or rather we are trying to improvise on the basis of scale of this cost measurement and cost reduction area. In Q2, we had an EBITDA in terms of rupees almost ₹69 crore, which was 24.2% of my overall gross EBITDA.

In this last quarter ended December '25, we recorded ₹75 crore of EBITDA, which is coming to 25% 25.7% of my gross revenue. If we talk about the EBITDA net of the other income, it is almost 21% in Q3, that is December '25, which was 20.2% in the previous quarter, and it was somewhere about 20.80% for the last fiscal, that is FY25.

For the corresponding 9-month period if I tell you, we had this net EBITDA netting of other income, it is 21%, 21.6% in the fiscal '24 and almost again on the same line, 20.77% for the 9 months ended on December '25. Coming to operating PBT and PAT, in this Q3 of FY26, we have recorded ₹65.5 crore as an profit before tax, which was ₹59 crore in the previous quarter, that is second quarter of fiscal '26, and the same it was ₹45 crore in the Q3 of FY25, that is December '24 quarter.

There is a sharp increase on an quarterly basis as well as on comparing to the previous year's quarter. Here would like to tell there is a significant improvement because of the overall other income what it has been increased in this particular quarter compared to previous quarter as well as the quarter which was there in December '24.

Profit after tax in Q3 for fiscal '26, it is almost ₹48 crore, which was ₹44 crore in the previous quarter. Again, in December '24, it was ₹20 crore only because we had an exceptional item of ROR interest provided in that December '24 quarter.

Here in this quarter also, PAT is being reduced by almost ₹2.5 crore, that is by way of exceptional item which is for the impact of the new labor code which has been implemented from 21st November '25, wherein the potential gratuity liability, it is supposed to be disclosed and valued and to be accounted in this December '25 quarter only. That has been valued at ₹2.5 odd crore, which has been net of in this profit after tax figures.

Revenue bifurcation: bearing rings, it is almost 52% of my overall revenue of components; 48% consists of auto component business. In terms of exports, it is 47% and domestic 53% in this 9-month period.

Certain business development, as I mentioned, that 10% improvement on overall exports to Europe over Q2, 25% compared to fiscal '25. Again, 10% downfall in exports US over Q2, which is almost 30% down over fiscal '25 as I have informed.

As I told that tariff hangover is expected to be normal from Q1 FY27, and we expect a sharp recovery in the US market. The downfall what we had, 30% of the revenue in this fiscal, would definitely move further in a positive way.

We do have a bit more visibility as far as the auto component business or growth in the auto component business on the basis of the orders or forecast given by the new customers, particularly from the Europe. We have also added one customer from Mexico and one from USA that would be starting somewhere about mid of fiscal '27 and one customer in quarter three of fiscal '27.

On the bifurcation of my revenue split, rather it is 53% of overall revenue, it goes to the passenger vehicle. Then it's 19% which is there for the industrial segments, and 21% for the commercial vehicle and heavy commercial vehicle, and EV almost 7.5%, 7.6% of my overall revenue.

Here would like to tell that 53% of this passenger vehicle share is because of good reduction in my CV and HCV portion. The US, one of the main customer who is a vital or rather who is procuring good amount of auto components for the CV and HCV, is under pressure because of this tariff.

Actually it's not like that we have reduced or rather we got the incremental share in passenger vehicle. No, it is almost on the same line, but the downfall in the commercial vehicle has moved up my percentage of my passenger vehicles.

Total revenue in terms of operations for the 9-month figure, it is ₹838 crore almost, without considering other income. Other income is almost ₹47 crore.

Both put together, ₹885 odd crore gross revenue has been recorded in this 9 months of the current fiscal, which consists almost ₹365 crore revenue from the overseas business, which is my exports as well as my export incentives, and almost ₹473 crore in the domestic market, which is including my product sales as well as scrap revenue. Which was in last year, fiscal '24, it is totality it is almost ₹1,155 crore, wherein 553 consists of exports, yeah, and ₹601 crore in domestic market.

Would like to tell here, we are almost on the same line or, as I've already informed, that we would be having the same kind of numbers for the fiscal '26 what we had in fiscal '25. Let me tell you, the EBITDA what we had in fiscal '25, which is 22.7%, it has almost 24.9% in this 9-month period, amounting to ₹221 crore, which was ₹269 crore for the full year.

As I was mentioning earlier, PBT and PAT for this entire 9-month, profit before tax is almost ₹193 ₹192 crore, which was ₹226 crore for the full fiscal of FY25. Again, PAT, it is ₹141 crore, which was ₹174 crore in the full fiscal of FY25.

Here we do have, as I told you, that here the PAT is bit improved compared to the fiscal '25 numbers. As well as PBT also, it has increased by a bit compared to the overall fiscal of FY25.

Operating cash flow, we had for the first half, it is almost ₹87 odd crore free cash flow what we have generated, again with an capex of hardly ₹12 crore in terms of a couple of furnaces and a small forging line. As you are very much aware that company is having net negative debt for last couple of years, company is having surpluses which has been parked for to raise another income.

Overall there is a negative or rather debt-equity ratio. Coming to the ROCE, return on equity, it is 17% for fiscal '24, it is 16% for fiscal '25, and I expect to be in the range of 15% to 16% for the fiscal '26.

These are the detailed numbers what has already been shared with you people. Now I would like to request team Equirus to take it further, and we can initiate Q&A session.

Yeah.

Thank you, sir. Thank you for the opening remarks.

We'll now open the floor for the Q&A. Anyone who wants to ask a question can please use your raise hand function.

Once you're done asking your question, please lower your hand. We'll wait for a couple of seconds for the queue to assemble, and then we may start.

Yeah. The first question is from the line of Jason Soans.

Jason, you have been unmuted. You can go.

Yeah. Thank you.

Am I audible?

Jason.

Yes, yes. Sure.

Sure, sir. First I just wanted to know, sir, the numbers in terms of the segments, export bearing rings, export.

Firstly the numbers for Q3 FY26 and then Q3 FY25.

See, for the Q3, the domestic bearing ring, we have recorded, I'll tell you in terms of million, it is 953.69. Export bearing ring, it is 380.55.

Domestic auto component, it is 397.80. Export auto components, it's 839.87.

Scrap revenue, it is 149.11. Export incentives, it is 27.35.

This all puts together 2,748.37 for the Q3 of December '25.

Okay. Now Q3 FY25, sir, which is our last year corresponding?

You want the full year or for the 9 months?

No, no, only the Q3, sir, Q3 the. Q3.

The one ending in December. Yeah.

Domestic bearing ring, it is 730.39. Export bearing ring, it is 283.33.

Domestic auto component, it is 386. Export auto components, it's 995.38.

995 you said, sir?

Yeah.

995.38. Okay.

Yes. Yes.

Sir, scrap and export incentives?

Scrap was 167.38. Export incentives, it is 36.42.

36.42.

Yes.

Okay. Perfect.

Sure, sir. Thanks for that.

That's up to 2,598.82.

Sure. Sure, sir.

Thanks for that. Now next, I just wanted to ask, sir, even in the previous concall last quarter, you had mentioned that you are expecting the tariff from the 53% to be reduced to 18% to 20% on auto components.

Now, just wanted to know that you did speak in the opening remarks that although that is 18% has come, but fine print has still not come. I just wanted some clarity, sir, what exactly?

Also I wanted to know 18% on the MHCV parts, basically the auto component parts, and bearing rings as well, right? Both will be reduced to 18%, the tariffs?

See, as I told you initially, for this auto components, till 31st of October it was in totality 53% import duties were there. From 1st of November, they have given certain relaxations, that is from section 232, which has reduced 25% duty from 53.

As of now, or rather till 7th of February, we have been charged at 25% with the duty plus basic customs duty, what equals 2.97 along with merchandise fees and this thing. Now looking to the notification or rather the issued by the US government, we are not sure whether this 25% what it is applicable to us as of now.

Because we also got a feedback that it would be a zero also in certain auto components, it would be an 18% also on certain kind of this thing, or it may continue with the 25% also. That is subject to the clarification and detailed notification along with the respective HSN, then only we'll be able to know.

Once we'll have some kind of clearance at US Customs, and we'll be able to know maybe in next couple of days that how this would be implemented and what has been interpreted at their level. Because broadly they have simply told that on the one side they told that Russian import duty has been moved off, which was 25%.

On the other side, it is staring that duty would be 18%. We are a bit not aware unless and until or even not would like to comment unless and until we have something authenticated on paper.

Sure, sir. Just to summarize, till 31st October you had 53% tariffs.

Then from that 1st November to this point in time, you had around 28% tariff. You said 25% plus some surcharge, etc., which was coming up to 28%.

Now you'll wait for the fine print with the HSN, etc., as to what exactly that will give us the clear picture. Correct?

Correct, sir?

Yes, very true.

Correct. Correct, sir.

Okay. Again, auto components definitely must be going by a large number to the US.

How about bearing rings export, sir? What is that proportion?

Is that also a significant proportion?

Bearing ring, as I told you, if you see bearing ring in terms of exports, it is we can say of 15% to 16% of my overall revenue which is there, and there we got an hit from majority from the European market.

Yet

it has not been fully recovered. If you see my last three quarter or rather all these three quarters for this current fiscal, my bearing ring export of overall revenue, it is 13 it ranges in between 13% to 15%.

Let me tell you, in say in fiscal '24, the same number was almost 23%. In fiscal '25, it went down to 15%.

In this last three quarters, we are having average of 13% to 14% of overall export bearing ring.

Okay. Okay.

No, sir, what I wanted to know is, see, the tariff is basically emanating from the US. Now, what I understand is the bearing rings is basically 55% domestic and 45% is exports.

From that export component, how much goes to the US? Only I am talking about bearing rings.

I'm only talking about bearing rings.

Okay. That portion of bearing ring to US, let me tell you, in terms of number, say, for example, for this 9 months, I told you that export bearing ring was ₹112 crore, ₹113 crore.

Out of that, the export to US is ₹32 crore.

It's ₹32 crore. Okay.

Sure.

You can say 1/3 of overall bearing ring business, rather export bearing ring business, that comes from the US.

Okay. Okay.

Remaining is from Europe and Canada, Mexico.

Okay. Okay.

Sir, on this, the tariff is that also will be clarified, that's what you're saying.

There we expect, because we didn't have any kind of duty-paid structure with for the bearing ring business, but there we expect it would be coming down to because it was 53 and now it would be coming down to 25.

Now you're expecting it to come to 25.

Okay.

Okay. Sir, revenue guidance '26, I think you alluded that it'll be flat in terms of revenue.

For '27, you still stick to the mid-high teen growth for '27 revenue wise?

Yes. Yes, as of now we still expect, and on the basis of the forecast all this thing, we expect in between, maybe 16% to or rather 15% to 18% of overall growth.

See, because in US 25% has been from 50 they have reduced to 25%, our customer in US, they are happy with this 25% also. Now definitely it is going to be 18, but when, we are waiting for the announcement from US government.

It has already been declared, it is definitely going to be there within a week or two weeks or something like that. Once it is there, then there are more chance of getting more business from US.

Sure. Sure.

Sure, sir. Sir, just lastly one thing, just wanted to know the revenue breakup between US, India and Europe and others for 9-month.

9-month

total revenue?

Total revenue. US, India, Europe and others.

I'll tell you broad percentage of that.

Yeah.

Say, 54% is domestic.

Okay.

22% is US. Same percentage it is there for the Europe.

Okay.

The remaining in between Mexico, Canada, Thailand, etc. Might be a couple of more for 2, 2.5%, 3% something.

Sure, sir. Done.

Thanks for answering my questions. Thank you so much.

Hello, am I audible, sir?

Yes.

Sir, I just wanted to ask you that what are the current capacities you have right now?

See, in terms of metric tons, the achievable production capacity is somewhere about in the range of 105,000 metric ton to 115,000 metric ton per annum.

Okay. What's your order book, including the additions in Q3?

Order book as of now on a monthly basis, it is ranging somewhere about ₹95 to ₹105 crore for the next 3 months.

For the forward quarter, right?

This is for. Last quarter, yeah.

Okay. What is the total order book, sir?

Total order book, what happened, sometimes my overseas customer gives us the forecast for a 6 months or something like that, whereas domestic might be of couple of months. If you ask me Q1 what I am looking for, or rather on the basis of the forecast, what we are targeting is somewhere about ₹325 crore or something like that for the very first quarter.

Okay. For the first quarter of FY27, your order book will stand at close to ₹325 crore, is that what you're saying?

325 to 330.

That will be your total order book as of Q1, right?

Yes.

All right, sir. That's all from my side.

Thank you so much for answering my questions, sir.

Yes.

Am I audible?

sorry for that. Sir, first of all, good evening and congratulations for the good set of numbers.

I have two queries. Now, the first query is, what we have seen is promoters buying some shares and selling some shares in December quarter within a couple of days.

Normally we don't see that happening. Can we know the reason behind it?

Let me tell you, definitely you have not seen frequently in past, and again you will not be seeing the same in future. There is some kind of, I would say, miscalculation or something, some kind of initially promoters has acquired to increase his stake only.

There were some kind of urgency wherein the funds was supposed to be deployed in a day or two only. That was the temporary option available to particular promoter.

On the contrary, promoters had a loss in selling of this, and tax implication was quite negative. That was by way of some compulson it has been done.

Now onward, we would not be there.

Okay. No, I just asked because it's a little weird promoter buying some share at ₹118 and selling it at ₹129.

That's the reason I asked this question. My second thing is, we have seen the pledging from promoter first time.

Do you know any reason for the pledge?

Pledge again, they have given, or rather raised certain fund towards that security, and which is some they have committed to invest somewhere. If you see overall quantum of the pledge against their holding is of promoters holding, you can say it's hardly 4% to 5% of overall promoters stake, less than 5%.

In terms of totality equity, it is somewhere about 2.5%, 2.7% something.

We all know that the pledge is so small, that's the reason.

It

is for a short period

they've committed, and maybe down the line, 3 to 6 months it would be squared off also.

Okay. That's all from me.

Thank you, sir. Thank you for taking my queries.

Hello. Am I audible, sir?

Yes.

Thanks for the opportunity. I have a couple of questions.

To begin with, sir, at the beginning of the year we had SOPs of ₹175 odd crore which were supposed to get into schedule during the second half. How much of that ₹175 odd crore got registered in Q4?

Do you still think that last time on the call you had mentioned that SOPs of around ₹225 to ₹235 crore would go into FY27 because we had some new orders of ₹40, ₹50 odd crore? If you can just throw some light on that.

See, your first part of your question, say out of that ₹175 crore revenue what we have projected and for the new program, new customers, out of that almost 60% of that volume, it has been started. Why 60%?

It's not like that order cancelled or rather order has not started. It has started with a low offtake, and certain orders it has been postponed.

Let me tell you, two big customers based at US, they have what do you say, temporarily just closed down that particular plant where the import duty was 3%, and thereafter phasewise it has went to 53%. It is something what you say, very unviable factor for the customer of my customer.

Those couple of programs have completely been hold or rather you can say a zero supply as on date, which was significant amount. Here, again, as I told you initial part or maybe in the earlier commentary also, that we had a loss of existing business maybe of 20% to 30% of bearing rings as well as particularly from the US.

As I've just told that 30% of my US revenue compared to previous fiscal, it has reduced in this current fiscal. Now these numbers, whatever the reduction is there, in spite of that, we are having the same kind of flat top line.

How I'll be able to maintain that top line, that is because of the new orders, new customers. It's not that it has not moved.

It has moved. A couple of reasons, as I told you, that volume has been reduced, a few orders have been deferred to 3 to 6 months, few order have deferred by almost a year or so.

Coming to the second part of your question where you were mentioning that ₹225, ₹230 odd crore something for the fiscal '27, we expect, as I told you, that maybe we would be closing somewhere about 1,150 odd something top line in this year, wherein I expect almost 200 odd crore, somewhere about ₹180 to ₹200 crore additional revenue from this new programs, because something it has already been started.

Okay. That yeah, that's helpful, sir.

Just a follow-up to the previous question. You mentioned that we have a monthly order book of ₹95 to ₹105 crore for the coming 3 months.

If you can, just bifurcate us bifurcate that for us in terms of bearing rings and auto components?

Sir, bearing ring ranges or near to 45% to 48%, auto components again 50% to 55%.

Okay. Sir, another thing is, of course, you have mentioned about the tariffs and more clarity is required, but post the recent announcements of Europe FTA and recent developments with respect to US tariffs, how has been the communication with our overseas clients?

In terms of what kind of volume offtake can we see in the coming fiscal if at all it comes to 18% and 25%?

See, I told you, na? This 18% number, as they have announced somewhere on 4th of Feb or something, and they again came out that from 7th Feb it would be implemented.

7th Feb, it was Saturday, and today we are at on the 10th afternoon, which is you can say the first working day, it was 9th over there. We are yet to know how it is.

As far as overall, we communicated, and Mr. Mihir also conveyed that my customer, as of now, they are okay or rather they have already absorbed 25% of import duty.

We think once the momentum start or once the overall activity would be on back to track, we would be do not expect any negative impact on this thing. That can be managed, because the kind of quality of the components and the range of the components what we are supplying, it would be difficult to get it from some other countries on a very recent way, or even in other countries, as you must have seen, the duty structure might be on a higher side compared to India.

Coming to the other part, EU deal definitely it is welcome, and our customers have again starting reviving or rather revising their certain calculations, and they have already indicated that they would like to source more from India. Now they are exploring what kind of components and how the value-added full components they can be import from the India, and particularly from the Rolex.

That is what the feedback we got from the European customers.

Okay. If I can ask this from other perspective, what has been our capacity utilization in first 9 months, and how do you think it is going to play out in FY27 and '28?

We are almost 62% to 63% utilization of my overall this thing, and I hope or rather we expect it would be somewhere about crossing 72 in between 72% to 75% of utilization in next year.

Great. Great, sir.

Lastly, if you can comment on profitability, how do you see with tariffs moving and volumes going up, as you mentioned that utilization is expected to increase from 62%, 63% to 72%, 75%? How do you see profitability vis-a-vis if you can just throw some light in respect to both the segments, bearings and auto components?

See, would like to comment on the net operating margin, because I'm not considering the other income margin, it might be temporary. It consists of certain my investment income and foreign currency gain, etc.

Coming to the net operating revenue or you can say net EBITDA, which is somewhere about it ranges of 20 and in between 22 to 20, that is 20 to 21, and once I'll be having utilization up to 68%, 70% or something like that, definitely this operating margin would touch maybe 22% or 22.5% even we can achieve once we have that kind of scale of economy. Again bifurcating into the bearing and auto components, definitely auto components we have better margin compared to the bearing rings because of the critical operations as well as multi operations and high precision level.

Broadly we can say

Saurabh,

No worries. Yes, sir, you were mentioning about the segmental profitability.

Mihir, I'm getting very low voice. I don't know.

Just a second, please.

Voice I think is clear.

Sorry?

Yeah. Sir, Hiren sir, you were talking about segmental profitability, auto and bearing rings.

As I was mentioning, auto components will always be having better margin because of critical operations and precision level, and even the application of the auto components for the EV, hybrid vehicles obviously will carry a good amount of value-added processes. Obviously the margins are on a higher side compared to bearing ring.

Traditionally, or rather bearing ring if I figure it out, it would be somewhere about 18% to 22% some kind of net operating EBITDA, whereas auto components it ranges in between 20 to 20, 20% to 25% of net EBITDA margin.

Okay. Any update on ROR, sir?

ROR as you are aware that recently I have updated that the bankers, we met bankers and we tried to convince them, and initially they got convinced that there is some kind of error, some kind of calculation, they need to revise it. That's why they have called off the demand what they have issued.

Maybe in this week only we are again planning to meet executive director of the lead bank to take up this matter as quick as possible, and we are going to submit that we would like to close this matter maybe before March '26.

Thank you, sir. That's all from my side, and wish you all the best.

Thank you.

Yeah. Thank you.

Sir, one question from my side. Now with the Europe FTA also, and in the opening remarks we had mentioned that we are seeing some auto contracts from the Europe side of business also.

What do we see here, how the things can move, because what I want to understand is what are the current duties which we are paying right now, and under FTA how would it impact us? Some color on that.

I'm sorry, I'm not getting your question because in between your voice was cracking.

Yeah. Is it okay now?

Is my voice audible now?

It's too low. Tell me.

Yeah.

I was saying that due to this Europe FTA thing, now what are the current margin structure what we are exporting there, and with the FTA what is something which we expect on our product portfolio? With our interactions with few auto clients there, auto component guys there, are we seeing some kind of positive traction that we may see some order flowing here?

Definitely. I told you that a couple of customers, our existing customers, they are in dialogues.

After post this deal with the Europe, they are a bit more hopeful and expecting some more products, because the conversion cost and the production cost at Europe has significantly increased, we would be having that leverage over there. Whether it is Europe or US, we are having more or less same kind of profitability unless and until if it is a bearing ring and auto components.

Okay. Okay.

Secondly, sir, in terms of the revenue numbers, the segment numbers which you had given, if we dissect that, the bearing segment on a year-on-year basis has seen a decent 30% kind of a growth. Can you throw some color on what kind of traction will it continue going ahead as well, in terms of the growth levels which we are seeing on a YoY basis here?

See,

the percentage of auto has increased, that is why the percentage of bearing has gone down compared to my overall growth in last 2 years, wherein we were a bit having tough phase for the industrial application bearing rings and even the commercial vehicle application bearing rings. There we had a good amount of dip, and even the particular one customer group where we were catering somewhere about 22%, 23% of our overall revenue of total revenue, I'm telling, that has gone down to even 10%, 11%.

There is a significant reduction of that particular customer who is mainly into non-automotive bearing ring segment. Now I think it's high time and we are expecting some turnaround from there also.

Bearing ring apart from that in auto sector we are getting good response. A couple of other domestic customers who were on a lower side, they have increased the existing volume as well as they have added new products also.

The couple of main bearing manufacturers in the domestic market, they have increased their wallet share and they are contributing somewhere about 12%, 13%, 14% of my overall revenue, which was earlier 9%, 10%. Again, as I told initially also, that my bearing ring export before 1.5 year was 22% of my overall revenue, whereas it has reduced to for 13%, 13.5% in this 9 months.

Export is a huge dip as far as overall bearing ring is concerned, but no doubt it would not come up as quickly as auto components because the new order book what we have received, the new customers what we have enrolled, they're majority 60%, 65% are of from for the different kind of auto components.

Right. Sir, but export is another story, but when I see your domestic bearing ring numbers, here basically for the last 5 quarters you have been growing at a decent kind of a growth rate like this year this quarter also year-on-year it was up around 30%.

Is it that because we are seeing some traction from the new capacities of this domestic bearing ring players?

That's what I told, na? That another, except that one customer, other 3, 4 main players who have increased their number of components, who have increased the volume of that particular this thing, and adding the new facilities also.

One of the customer who has yet not initiated one of its production capacity settled in Gujarat, now they have started to the extent of 30%, 40% utilization, and we where we got some chance over there. Those players are showing traction and it is on their expansion mode, and down the line 6 months further we are expecting the same kind of growth in the domestic bearing market.

Okay. I'll take the next question.

The next question is from Kush Nahar. Kush, you have been allowed, you can go ahead.

Kush, you are not audible.

Yeah. Am I audible now?

Yeah.

Yeah. A couple of questions.

First is these new customers that we have added, as you mentioned, in Q3 FY26, this would be in which segment, bearing rings or auto components? If it's domestic or exports?

Just wanted to understand what was our right to win for these customers. Like you mentioned that there is an increase in wallet share, are we cost competitive or just some elaboration on how we are replacing the existing supplier.

That is one. Second, I think that many of our bearing ring customers are expanding in India, previously we have mentioned that we have around 30% to 35% market share in the domestic bearing rings, going ahead in these new plants, do we see it increasing directionally towards 50%, 55%?

Are we benefiting from that expansions since they all want to make India as an exporting hub also? Third, lastly, considering the volume normalization that we're expecting because of the trade deals, more from a 3 to 5-year perspective, any sense on the CAGR growth that we can do in terms of top line considering the order book and the commentary of our customers?

Coming to rather taking up your portion of the question, last portion, that for next 3 to 5 years or something, see let me tell you, it's very difficult to tell you the CAGR for the next rather beyond 3 years from now, but definitely the order book and the program tenure what we have received, we expect somewhere about, in between 12% to 14% CAGR growth for the next 3 to 5 years. Down the line if I'll tell you today we are there in March '26, maybe March 2030, we would be touching or rather we we in turn in turn we have a plan to, almost double the revenue what we have.

That is the last portion. Prior to that, I think I already told that domestic players who are in the expansion mode, particularly the bearing manufacturers who are utilizing or who are adding new products, who are, adding products which they were initially or rather earlier they were importing, we got that, good chunk of that order or rather good chunk from that particular segment and even the existing one.

That is why the 3, 4 players for the bearing ring, the percentage or contribution to the revenue has increased, and overall my domestic bearing ring business has increased. I don't know, can you just repeat the first part of your question?

I think the new customer what I was mentioning, what we have added in the, in this quarter, that both these customer are for auto components, and maybe in this month, before end of February, one of the bearing ring customer would be started. Right.

Sir,

just some elaboration on the right to win, because we must be replacing the existing supplier, is it the cost or is it that sourcing strategy which the companies are changing that's why they are more friendly with Indian players?

Generally it is difficult to intervene into the existing program, but one of my customer who is sourcing this components from the other country, and now because of restrictions of his customer, he is required to move to the preferred countries where India would be. In that case they have given us this order and in which they want immediate supply, maybe down the line 6 to 8 months only.

Otherwise there would be a new program, new product development, the OEMs who are developing a new kind of vehicles, that will attract the new vendor. These companies already if they are into certain program, they are in touch for the forthcoming programs to a potential forging player having wide range of capacity and able to offer the most value-added processes, so that's why we got a preference somewhere over to the other countries.

Right, sir. Thank you for the answers.

Due to limitations of the time, that would be the last question. Over to you Hiren for the closing remarks, and we can end the call.

Thank you very much to team Equirus as well as our investor, analysts from that team. As usual, would like to reiterate that management is very much concerned and dedicated for the development of this thing.

Though we had a couple of hurdles as far as the overall performance, that is execution of that thing, because of certain geopolitical reasons or somehow some other factors which have restricted our this thing. Would like to clarify that the challenges what we are facing, it is not only to the Rolex Rings or something.

This is the overall economy or rather even the other players in the other segments, they are also facing the same kind of challenges. Here I'm pleased to say that we try to manage the momentum.

We didn't try to lose the overall utilization as well as overall top line, and at the same time we tried to maintain the net operating EBITDA, net operating margin, and it would be on a positive side. On the basis of the order program, no doubt it was there supposed to be executed in the fiscal '26 only, but as you all are aware that these are the situations where the customers' buying feasibility is being disturbed.

Now we think it would be on a track or maybe from the next quarter onwards, as I was mentioning, we would be having that momentum, incremental momentum, and along with the same kind of profitability, and maybe in next year or so, again we are going to honor the expectations of our stakeholders in all way. That is what we are expecting, and that is what we would like to convey to our respectable stakeholders.

Thank you very much for investing. Thank you very much for trusting.

On behalf of Rolex Rings, again I would like to acknowledge all the investors and the participation along with the Equirus team. Thank you.

Thank you.