Borosil Limited (BOROLTD) Q4 2026 Earnings Call Transcript

Ladies and gentlemen, good day and welcome to Q4 FY26 earnings conference call of ProSail Limited, hosted by ICICI Securities. As a reminder, all participant lines will be in the listen-only mode and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing star then zero on your touch-tone phone. I now hand the conference over to Mr. Manan Koyal from ICICI Securities. Thank you and over to you, sir.

Thank you. On behalf of ICICI Securities, we welcome you all to Q4 and FY26 Result Conference Call of Borosal Limited. Today, we have with us Senior Management, represented by Mr. Shrivar Kheruka, MDN CEO, Mr. Rajesh Kovar Chaudhry. All-Time Director, Mr. Anand Sultanya, CFO, Mr. Rituraj Sharma, President, and Mr. Dhaval Patel, Head of Investor Relations. Now, I hand over the call to the management for their initial comment on the quarterly and annual performance. Then, we will open the floor for Q&A session. Thank you, and over to you, sir.

Well, thank you, Manan, and ICSF Securities for region's call. Good afternoon to every one of you. The Borosil team and me are delighted to be communicating with you once again. I'm pleased to inform you that Borosil Limited's board has approved the financial results for quarter four of FY26 and for the full year FY26 during our meeting held on 19th May. We submitted our results and an updated presentation to the stock exchanges, and they are also available on our company's website. Given that this is a year-ending call, before I get into the financial performance, I wanted to list out some of our achievements in the last year. As you may be aware, we announced last year on April 2nd that we were going to set up a manufacturing unit for vacuum insulated stainless steel flask at a cost of 65 crores. I'm happy to say that the commercial production from the first two lines is expected to commence in the next few days before the end of Q1 FY27, and the third line is expected to commence by the end of Q2 FY27. The plant is completely ready, and the trial production period will begin very, very shortly. In addition to that, on the marketing front, Borussia Ltd. was awarded a jewelry recommendation at the inaugural Economic Times Award for Design and Creativity in the most creative packaging redesign category. The revamp focused on creating stronger shelf impact, clarity, and a contemporary brand presence across all customer touch points. The brand underwent a significant refresh with teams developing India's first color-coded omni-channel first kitchenware. Visual Identity System. This strategic transformation strengthened brand distinctiveness, enhanced consumer navigation across categories, as we have multiple categories now, and reinforced Boris's premium design-led positioning. In addition to marketing, the company's manufacturing facility was also available at the India Green Manufacturing Challenge 2025 by the International Research Institute for Manufacturing. The award reflects the strength of our process optimization initiatives and really is creating sustainability with long term operation and cost efficiency. Coming to the HR front, Borussia Limited has continued to be certified as a great place to work, reflecting its commitment to fostering a positive workplace culture, a high trust work environment, and strong employee satisfaction across its operations. This recognition underscores the company's continued focus on prioritizing its workforce and building a collaborative and rewarding organizational culture. On the balance sheet side, ICRA ratings has reaffirmed our credit ratings to AA- with a stable outlook for the long-term facility and A1-plus for the short-term facility. This strong investment rate profile reflects the company's solid liquidity and resilient operational positioning. Coming back to marketing, to deepen consumer engagement and cultural relevance, the company also conceptualized and launched Borussel Kitchen Connections. This is a distinctive content-led property that revamps celebrity kitchens while extending participation opportunities to consumers. By showcasing the Morisul product ecosystem within real celebrity homes through authentic storytelling, the initiative is building stronger resonance, relatability, and aspirational brand affinity among modern Indian households. So now moving on to the financial performance. I would like to say that Borsal has delivered a reasonable performance in FY26, with revenue from operations reaching Rs.1195.9 crores, up from Rs.1107.8 crores during the last year. This represents the 8% year-over-year growth. This growth, if we look at it from a product category perspective, although we don't share numbers at every level, is impacted substantially owing to the challenges that we have faced throughout the year in our key category, that is Hydra, the vacuum-insulated stainless steel flask bottles and containers. The quality control BIS order was implemented in the financial year 2025. And the resultant supply chain challenges have impacted the company's financial performance, both in terms of revenue and margins, and have significantly even impacted our share presence in this category. In FY26... The company achieved an operating EBITDA before exception and one-time income of INR 176.7 crores as against 177.7 crores in FY25, which is basically flat for the year. And in fact, the operating EBITDA margin has reduced from 16.3% the year before to 15.1% in this year. As I mentioned before, the main challenge has been the lower sales of Hydra without its, let's say, reverse operating leverage which has impacted us in this particular year thanks to the supply chain challenges for Hydra. During the quarter ended March 31, 2026, the production activities at the company's Goroseke glass furnace for pressware products and its open glass furnace located in Jaipur were also impacted temporarily due to the restrictions in supply of LPG arising from a force-major situation caused by the West Asia crisis and its consequent impact on global fuel supply. Consequently, the operations and financial performance of the company for the quarter were impacted to that extent. Coming to other operating income, that is INR 26 crores, which is coming from shared service support income, compared to INR 18.4 crores in FI 25, with the related expenses reflecting on total expenses. As a result of that, profit before tax for the period was INR 100.9 crores, compared to INR 103.2 crores in the previous year. F526 includes a few one-time items, including expenses related to demerger of INR 7.2 crores, also, which is actually a reversal, sorry, it's a reversal of the expense of demerger of INR 7.2 crores, but on the flip side, a one-time expense of INR 1.8 crores for professional fees, as well as income from investments of 4.3 crores. And royalty income of 12 crores. Sorry for the lots of numbers there, but this will all be available when the printout is shared. Compared to this, last year the company has recognized one-time income on account of transfer of tenancy rise of INR 13.5 crores and income from investments of INR 5.9 crores. The depreciation this year increased by INR 5.8 crores while finance cost declined by INR 6.2 crores primarily due to debt repayment in FY26 as compared to last year. There was also another impact going to the new gratuity and leave provision amounts on account of the new labor code and that is about INR 4.0 crores which is shown as an exceptional item in this financial year 26. As a result of all of that, profit upper tax rose marginally from INR 74.2 crores in FI 25 to INR 74.7 crores in FI 26. During the financial year 26, the company generated cash from operations of approximately INR 119 crores. As of the end of 31st, March 26th, at the consolidated level, Bursa Limited maintained a strong balance sheet with a net debt position of INR 49.7 crores. Coming to all the points listed above were with respect to the entire financial year. Now we'll come to the section on quarterly performance. The company has achieved operating revenues of INR 284.1 crores in Q4 FY26 as against INR 270.2 crores, which is a growth of 5.2%. This is also the slowest quarter for most consumer business across India, and that's reflected in this quarter as well. The bid-up margin before exceptional and one-time items was 11.5% in Q4 FY26 as against 14.2% in Q4 FY25. And Pat was INR 10.6 crores this year in the quarter four, as we get INR 11.1 crores in the year before. So let's take a closer look now at our category-wise performance for the full year FY26. Borosil's consumer sales continue to grow across both glassware and non-glassware segments, barring the Hydra impact. As well as our Opalware range also grew under the Lara brand. The Lara Opalware segment recorded sale of INR 411.9 crores in FY26 compared to INR 383.8 crores in FY25, which is a growth of 7.3%. In our glassware segment, which includes borosilicate, microwavable products, servingware, glass tumblers, lunchboxes, we recorded a year-over-year growth of 17.3% in FY26. Revenues stood at INR 295.5 crores compared to INR 252 crores in FY25. Non-glass fire segment, which encompasses a wide range of small home appliances, insulated bottles and flasks, cookware, and other kitchen essentials, posted a 2.4% increase in revenue, with the turnover reaching 4.63.7 crores in FI26, compared to 4.52.9 crores in FI25. As already mentioned, the Hydra bottle sale has come under substantial pressure owing to the non-availability of product owing to the BIS or the QCO implementation. Our team has recognized these headwinds and is actively reshaping overall strategy to mitigate their impact. And as a result of this, we had already, as mentioned before, we had approved the project for our upcoming manufacturing facility through our wholly owned subsidiary, Styleness India Limited. And this project includes three double wall production lines. And as I mentioned before, two of these lines will be having commercial production by end of next month, and the third one by end of Q2 FY27. This investment is being financed for a mix of equity, debt, and internal accrues. This expansion does reinforce our commitment to make in India and will also, in the medium to long run, enhance cost efficiency, ensure compliance with BIS and strengthen our supply chain, which can deal with issues such as the West Asia crisis more effectively. During the last year, FR26, the company did strengthen its focus on cost discipline to improve operating efficiency. Expenditure on advertising and sales promotion remained controlled with a marginal increase from INR 80, approximately 87 crores to approximately INR 88 crores. Power and fuel costs saw a sharp reduction falling from INR 82.4 crores to INR 78 crores. The reason I'm saying that sharp is that in spite of the high cost increases per unit which got impacted in the last quarter. The company is further investing INR75PROZ towards setting up a 20-megawatt ground-mounted solar plant with a battery energy storage system, which will further reduce the overall power cost, and the same is expected to be commissioned in this quarter, Q1X527. The phase 3 implementation of solar, which is added to the first two phases, will then take care of about 61% of the overall power requirements of the company. In May 2025, the Government of India notified the safety of household, commercial, and similar electrical appliances, Quality Control Order 2025, making a significant step towards enhancing consumer safety, quality assurance, and market regulation. Earlier, effective 19 March 2026, this order mandates BIS certification for a broad range of electrical appliances, including coffee makers, cooking and cooking ranges, hobs, ovens, and similar appliances. Recently, in QCO 2026, the implementation timelines have been extended to 1st October 2026, from trial date, I think sometime in March. Accordingly, the company has built up advanced inventory to mitigate potential sales disruptions, as non-certified products will not be permitted for sale in India beyond the prescribed timelines. However, I don't think this QIS or the QCO will have as much of an impact or any impact compared to Hydra because the company is very well placed to switch from imports to local sourcing for these product categories. Between FI18 and FI26, the company has delivered strong and consistent growth with revenues regarding a CAGR of 21.4% and EBITDA expanding at a faster 29.4%. That's over a period of eight years. This reflects operating leverage and improved profitability. Since the acquisition of Lara in 2016, revenues there increased from IR48 crores to IR412 crores in FI26, translating into a 24% CAGR. In parallel, the non-glassware portfolio has scaled from INR 23 crores in FI 17 to INR 464 crores in FI 26, achieving 39.6% Kegel. Both of these points underscores the company's ability to successfully grow into new product areas and create long-term value. Industry from plastic to glass is not just a material transition, but a meaningful behavioral change driven by rising health awareness and evolving lifestyles. The viewers today are increasingly cautious about chemical leaching, hygiene, stains, and odors associated with plastics, especially for daily food consumption outside the home. As a result, glass, particularly borosilicate glass, is becoming the preferred choice for office lunches, travel, fitness-led routines, and modern kitchens due to its safety, non-reactive properties, and hygiene benefits. In this evolving category, Borosil is well-positioned to give a strong brand trust, glass expertise, and products specifically designed for everyday Indian usage. A cornerstone of Borosil's long-term strategy is a strong Make in India commitment. In addition to operating opal ware furnaces of 84 tons per day and a 25 ton per day bodicellia glassware plant, we are now starting a new facility for vacuum insulated stainless steel bottles, flasks and containers, and also expansion of our injection molding operations for the plastic lids that go on our lunchboxes. Last year, in the last quarter, the board also approved two further expansion projects. One is to expand our furnace capacity from 25 tons per day to 32 tons per day with the addition of a third forming line. And this will likely happen in the year 27 or 28, depending on when the furnace life is over. The cost of this capex is roughly 50 crores. And this will help company remove capacity bottlenecks and will further improve operating efficiencies. It will also help further improve product diversification and portfolio expansion. The second CapEx was the glassware manufacturing at Baruch, where the company will produce, through its outsourced vendor, drinking glasses, glass storage jars, jugs, and bottles. That is from the Borussia Scientific's Baruch plant. And the company is looking at a high growth potential in these categories. And we expect this facility to be commenced by end of Q3, FI27, with a capex of approximately INR-42 course. Courses' strong omni-channel presence spanning all the channels, including trade, retail, modern retail, e-commerce, and B2B, have driven deeper market penetration with availability in over 24,000 retail outlets. We have built a well-diversified revenue base. I'm serving both urban consumers and global markets. I remain very bullish on the organizational capabilities. Last year was a tougher year on account of the impact of supply chain from Hydra, and then the last quarter, the West Asia crisis further enhanced that challenge. However, these are short-term issues, and we expect fully that our long-term growth trajectory, as well as from a revenue perspective, as well as from operating profit perspective, will continue unabated as it has for the last eight or nine years. With that, I'd like to now open the floor to questions that you may ask.

Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and 1 on the test phone telephone. If you wish to remove yourself from the question queue, you may press star and 2. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles.

The first question is from

the line of Mr. Jeeval Shah from VVD Asset Managers. Please go ahead.

So, thank you for the opportunity. So, I have two questions from my side. I just wanted to know that in my view, borosilicate glass products are generally considered higher margin products. However, despite the ramp-up in the borosilicate glass facility, gross margins remain lower in this quarter as compared to Q4 F525. Could you help us understand the key reasons behind the margin pressure?

See, as far as glass is concerned, there's a lot of dumping from China. And that China is dropping on virtually in every category. So, there has to be, you know, while of course, Borosil as a brand and as a product portfolio is able to charge some premium on the dump prices, but end of day, it's not in isolation. So, that has been a challenge and continues to be a challenge. But I think notwithstanding that with trying to improve our product mix, we're trying to fight that situation. That is an issue that unfortunately exists for us. The other thing is, of course, with the West Asia crisis, the cost of gas and other inputs, which are in the raw materials and all have gone up, especially in Q4, which has also impacted materially the margins. And as a result of that, we had to take up price entries. But there's always a lag impact on the price entries being, you know, playing out.

Okay, so the second one is, could you provide us some guidance on the expected cost-savings benefits from the solar plant in FI-27?

Yeah, I think the CFO can do that. Anand, can you take that question?

Yeah, so that will be, that is estimated to be about 28 crores at EBITDA level.

For FI-27. Yes.

Yeah, thank you. Thank you.

Thank you. The next question is from Mr. Naveen from iis.pms. Please go ahead.

Hi, Tim, can you hear me? Yes, we can. Yeah, thanks a lot for the opportunity. So just wanted to touch upon the OpelWare segment alone. So just wanted to understand what kind of utilization we were working on, like any expected CapEx and your general market outlook and all that stuff. You can just help me with that.

Yeah, OpalWare, look, has been on a, I mean, we're close to 100%, I would say between 90 and 95% utilization, depending on the month. Now, given the category, you know, last year has been a bit, as far as OpalWare is concerned, the market has slowed down. And in fact, there has been I would say less demand in the market, or let me put it another way, the demand growth has not been as robust as it has been in the years prior. Our lookout is for de-bottlenecking at the moment. We will be expanding capacity to some extent by de-bottlenecking some of our production processes further, you know, as we have been doing over the last few years. But at the moment, we are not considering any major capex on Opelware, which meaning putting a third line or anything. And rather, there are other categories where we believe the growth can be much faster, and we'll be focusing our attention on other categories, for which already we have announced graphics, which I covered earlier.

Got it, got it. So, I just wanted to understand, so the category itself is like 1350 crores, and we ourselves are like nearly a third market by top line, right?

Yes, that's right.

So, I just wanted to understand, read on the general space, so like competition, outlook, like how exactly do we see that?

So, frankly speaking, I think what we've done as an industry, we've not yet been able to, I mean, the product has been around for 10, 12 years, maybe 20 years. And I think what we need to do more or better as an industry is to get something new. We are differentiated in the industry to create, again, a wow factor for customers that, you know, something better has come. And that's something we are working on with our R&D center. But until that comes, I think overall, in general, there is muted customer sentiment across the board. I'm not just talking about, you know, kitchen. There has been muted customer sentiment. This crisis, you know, so I think unless we come up with something exciting, it's going to be challenging to spark substantial growth in this category. I'm just being honest here. And we're working on that. But at the moment, I think we are for the next year or so, I think we're going to expect to see mutual growth. And hopefully our R&D efforts will, you know, play off and lead to something nice, which can then be kind of ignite this category.

Yeah, all the rest for the rest of the year. Thanks a lot. That's it for my time.

Thank you. The next question is from Utkarsh Nupani from Anandirati. Please go ahead.

So my first question is related to your glassware segment margin. So like if we see gas prices in India has gone up by more than two and a half time, what it was there before the war, which we believe is not the case in China. So wanted to know whether our glassware margin is likely to remain under pressure till the time the gas prices remain high in India.

Oh, yeah, of course. I mean, two and a half times is substantial. I believe China has also gone up. I don't think it's not gone up. But it may not have gone up two and a half times, but it definitely may be doubled. So I think the differential may be there, but may not be that substantial. I do believe China has to increase prices also. Plus, of course, the rupee depreciation in that sense helps us because it's also become slightly more expensive to import. But overall, yes, China is a major irritant and challenge because they routinely are selling products lower than the cost of. You know, production and, you know, dumping because of overcapacity or whatever reason they may have. So that will, over a period of time, definitely cause, you know, some pressure on the margins. We can only keep working on innovation and petitioning the government to kind of create a level playing field, which you're trying to do.

Okay. And so, Nick, what would the status of anti-dumping duty investigation which is going on?

As far as our application is concerned, it's only for boros liquid glass. I do believe there may be something else in the market for soda lime, but there's nothing to do with us. And as far as timeline is concerned, I think Mr. Rajesh Chaudhary may have an update. Rajesh, are you on the call?

It must be present, and they are doing the investigation, but we hope that at least it will take six to nine months from now. Okay.

And, sir, like, how is the competitive intensity in Opalware at the moment? So, like, what we are hearing when we are talking to the dealers, they are saying that Laopala has become pretty aggressive in the recent past by coming out with a more aggressive pricing structure. So, whether this is likely to result into margin pressure in this category in FY27 over FY26, so qualitatively, if you can guide on the margin front for the Opel Bay segment for FY27.

No, frankly, I don't agree with that view, primarily because there's been high competition in the sector for the last 10 years. And, you know, different brands get aggressive at different periods of time. So, you know, it's never a status quo or never, you know, there's always something going on. So I don't believe that there's any per se pressure on pricing. There is pressure on cost, no doubt. And again, because of the, you know, abnormal increase in gas prices. And to transmit that cost, increase in cost on to the end customer will take, you know, a couple of quarters, one, at least one, maybe two quarters. So to that extent, there may be some margin pressure in the short run, but I don't believe that that's something that is going to, that's because of competition per se, it's more because to get customers to accept, you know, substantially higher pricing, let's say 8 to 10%, which is what prices you've taken, that takes a bit of time.

Okay, okay. And sir, like just continuing with this point, so how much price like we have taken in glassware and opalware and how much we should ideally take to cover that entire cost inflation pressure?

That should be enough to cover the entire cost inflation.

Okay, thanks a lot, sir.

Thank you. A reminder to all participants, please limit your questions to two per participant. Should you have a follow-up question, we would request you to rejoin the queue. The next question is from the line of Mr. Bhavin Rubani from Investec. Please go ahead.

Yeah, hi. Thanks for the opportunity. Sir, the first question is related to glassware. Sir, how should one understand incremental growth in case of glassware from here on? Since I understand that we have been running at almost 90% realization, and an incremental capacity is only likely to come after a year or two. So I just wanted some sense on that.

So glassware is a very vast category. And as I mentioned that we have the project of bottles, jugs, and jars, which will be implemented by the end of this year itself. And that would aid, you know, reasonable capacity, availability at least for the market. And the other question on the pressware, you know, Because we started when we started production, there was the sales were not as fast as the production capacity, but we do have reasonable lots of inventory. So, if the market supports, we can grow even without having grown the production for at least a year and a half or two because of the inventories that we are carrying today. So, glassware growth from a supply chain perspective are not a challenge. The growth only from a demand perspective is what we have to look out for. And if the growth happens from a demand perspective, then by the time, you know, we are kind of low on inventory, by that time we'll have the new capacity. So we planned it, I would say relatively, you know, well, and I think we can deliver just the market has to support.

So the second question is related to Capex. So apart from incremental Capex announced for glassware and Baruch plant, are we planning anything in case of kitchen appliances because BIS is kicking in soon? Also along with this, if you can call out a 527 Capex number.

Yeah, so capex, these two capex, which I already said earlier is about 90 plus crores. There's maintenance capex of, you know, roughly 20 crores, 25 crores a year, which will continue. And then there are no, I mean, there's many capexes under discussion, nothing further, which is approved. Although we can see in the non-glassware space, more capex, you know, potential on the horizon, which can be reasonable sized, because we see pretty, you know, And like you mentioned, even potentially in appliances, because we see very good market prospects in the future in the non-glass-press space as well. So I can only share that once it's approved by the board, but at the moment, I can only say there's quite a lot under discussion. And obviously, in the short run, things have been a bit unstable, but we do expect things to improve. So we will certainly be doing more capex in the future.

Thank you. The next question is from Risham Jang from VVD Asset Managers. Please go ahead.

Yeah, hi. Good afternoon. So, I have a few questions. First is, with respect to the thing which you mentioned about China pressure in Boros liquid, is that correct? Yeah, I did. Okay, even after 16-17% rupee depreciation, you see that challenge or that challenge because in last one year, we have seen almost 16% rupee depreciation. So, despite that, you are seeing that challenge now.

So, the rupee depreciation cannot be seen in isolation. There's also been massive cost increase and earlier somebody also asked about the The gas. So China is a very opaque economy, so it's hard to know exactly what the costs have gone up. But from my sources, my understanding is that the costs of gas per unit have not gone up as much as ours. Now, how much is the difference? I really don't know. And China also... It has various other ways to kind of subsidize exports. So it's hard to understand how the, whether the costs are connected on or not. We are... Obviously, the globalization offsets this, but to what extent, I don't know, because we still, the pricing we are seeing in terms of imports from, in the market or from China is still quite low. We will see how that, I mean, as far as dollar, FOB, you know, dollar terms are concerned, the rupee is benefiting us, but it's not to the 16-17%, you know, kind of level as you indicated because of. Our costs also have gone up to a reasonable amount.

Okay. And the second question, related question is with respect to gas cost. Gas is out of overall power and fuel of 80 odd crores. I presume that gas cost will be like 20, 25 crores out of that.

Anand, can you help here? One second. Yeah, we'll just come back to you. But yeah, it needs to be a small amount. Yeah.

So that must have gone up by like 30 crores extra.

Yeah, that's 30 crores. That's right. For all the three fondnesses together.

Okay, got it. Just the second question is from the working capital perspective. Last year, we said that our

working capital has gone up mainly because we have kept a higher inventory

of Hydra range, given that there was this quality control order. But this year also, given that Hydra sales itself has not happened, so I presume that you must have already consummated most of the Hydra inventory. But we see that overall inventory has further gone up, and which is in a way impacting your overall ROC, which you have mentioned in your presentation as well.

Yeah. So, you know, we've had back-to-back, and also mentioned the call, QCO implementations. So, high-wide inventory, whatever we built up last year is more or less all depleted. But on the flip side, we have to build up a lot of appliance inventory this year because of... Because of this QCO, which has come on a large range of appliances. In addition to that, as I mentioned before, the last two years, we have been producing much more on our borosilicate glass furnace than we have been selling because the capacity of the furnace is large, or the, you know, which we have set up. And that's needed. That's a certain minimum size of the furnace, below which it's not efficient. So that's also contributed to, you know, the increase of inventory. So, I think the appliances, again, is a one-off case, should correct itself. And Glassware, if the growth continues or we are able to grow more the market, then we should deplete these inventories at some point of time. At some point, meaning in the near future, hopefully. Obviously, if the anti-dumping comes from China, that will certainly improve our prospects substantially. But that's still to be seen. Either way, we have to be independent of policy from the government who work with, you know, expanding our product range and, you know, giving more options to the customers, which will hopefully consume that. So, overall, yes, it's been two years consecutive of inventory growth, but I do see a stop to that, hopefully, this year itself, and then from next year, we should see a reversal of that, because being more made in India should logically give us leverage to reduce our inventory, not have to increase it.

Okay, understood. Thank you, all the best.

Thank you. The next question is from messages deep from.

Hi, sir. Thanks for taking my question. Sir, what was the impact of furnace shutdown on sales on both segments of last year?

No, there was no impact because we have enough inventory. So the shutdown was for a few days, and we have enough inventory to kind of capture that. So there was zero impact of the shutdown on sales. There was an impact on costs and the fixed cost absorption when the plant was, say, suspended. So on the margin, there was definitely an impact, but not on the sales.

Got it. So basically, your glass inventory also went down, but still, you had to deploy more money to inventory for the year.

Glass inventory didn't go down. It's gone up because we've not sold the entire production capacity of the furnace. Even with the small shutdown we had for a few days, we didn't sell the entire capacity of the furnace last year.

Got it. And so, Shriva, sometime back you told me that, you know, your company is the only company to have set up borosilicate manufacturing plant in India. So that remains to be the case even now or other companies?

That's a fact, that's a fact, that's a fact, we all need this, because I mean, I'm pretty sure there's nobody else who has, I mean, most certainly nobody has started production. If somebody's planning something, I don't know, but nobody's started production.

Got it. So basically, China is hurting the borosilicate glass market through brands which are sourcing from China instead of manufacturing in India. Is that the right?

That's the right way to look at it. Exactly.

Got it. So, basically, the cost edge that you wanted to have by having your own manufacturing facility has not materialized. In fact, it has become an adverse scenario for Borosil versus your competition.

I can't say. Yeah, I mean, it's always been like that. It's not something which is new. I mean, by the way, this is the story in almost all markets where products are coming from China, where in the last couple of years, China has enhanced dumping. Okay. And I guess it's widely available in the news. And it's not just for our industry, it's for almost every industry in India. So that is a fact. And we would love that, you know, we get this support or, let's say, even playing field from the government.

Got it. And what was the increase in fuel cost that you had to bear on account of this?

So direct, as Anand mentioned, the direct cost is 30 crores or 30-35 crores per annum. Now this is, again, it's an evolving kind of number because it's changing every week. So if you extrapolate what is current, it's 30-35 crores per annum. But there's an indirect impact also, right? Because crude oil is used for packaging materials or crude oil derivatives are used for packaging materials. So that's gone up. Obviously, as diesel prices will go up, then that will impact more and more the freight inward and outward and inflation and, you know, salaries and so on. So there's so many, you know, second and third order impacts. But if it's called direct impact, direct impact

is basically your gas cost used to be 20 crores. That has increased to 35 crores. Did I get it right?

50. It increased to 50.

Oh, 20 crores has increased to 50. Two and a half pairs, two and a half pairs. Got it. Got it. I thought you would use small amount of gas because most of your furnaces are electric furnaces, right? Yes, 20 crores is not a big amount of gas.

The value has gone up because of the cost per unit has gone up.

Got it. That's all from my side, Shiva. Thank you. Bye. Thanks, Shiva.

Thank you. The next question is from Anuparak from Anandirati. Please go ahead.

Yeah, hi, sir. So my first question is, now that the bottles, vacuum bottles will be manufactured in-house, so how much margin expansion are we expecting over the trading margins?

See, then it's not like a switch that you flip on and the day you start manufacturing, the margin expansion happens because it takes, you know, six months to 12 months probably to stabilize. Initially, your losses are higher. So exact numbers, I guess, will be known later. But my sense is on the gross margin side, 10% at least you should get an increase. Otherwise, there's no benefit of manufacturing in India. So, but I don't think that will be realized in like the first couple of quarters.

Okay, and sir, in one of the interviews, you mentioned that we lost 100 grower of hydra water raised in FY26. So, is it correct that it was lost entirely in H2, FI26, because we had sufficient inventory in H1?

No, even in first half, there was a loss. It may not have been so high because of the inventory, as you mentioned, but there was definitely some loss. It may be more towards the second half of the year compared to the first half, but I can't say it was zero in the first half.

Okay. Okay, so that's it for me.

Thank you. The next question is from the line of Saganik Sarkar from SKP Securities. Please go ahead.

Yeah, thanks for the opportunity. I had a couple of questions. So the first question is on the glassware business. So out of the 295 crore sales in the glassware business, what percentage would be our own manufacturing?

Now? I mean, see, it's... If we define our own manufacturing as just presswear, it's roughly two-thirds. But if we define it including two-thirds, two-thirds would be Borussia Limited Manufacturing.

Okay, okay. 66% own manufacturing and 34% would be outsourced.

Yes.

Yeah, okay. And on the CAPEX front, like you mentioned, about 90 crores of CAPEX. So, for FY27, the CAPEX number would be around 110 crores. Is that correct?

Yeah, 110, 150, I mean, broadly, yes. Yes, broadly. It can go up, maybe it can go up depending on more projects through the year, but at the moment, yes, that's correct.

Okay, okay. And for the manufacturing percentage that you mentioned, two-third, like what percentage it would be in FY27, like if you could guide us on the percentage term?

I don't know. I don't think I'll change much. Okay. Okay. I mean, like I said, we need, if we get policy support, we'll go up for sure. We don't have a station mark.

Okay. Thank you.

Thank you. The next question is from I'm Rish Karkar from As An Individual Investor. Please go ahead.

Thank you for the opportunity. My first question is on debt. So debt has increased about 60 crores in the last two quarters to about 100 crores. And you've got some planned capex already approved by the board, potentially something more in the future. Generally, in the past, you've been quite cautious on debt. Otherwise, you could share what your thoughts on fundraising are, whether it will be more debt for the time being, or you might raise more equity?

No. Not much debt, right? So, this, I mean, it may go up in the short run, but we also have, I mentioned our operating cash flow was about 120 crores. If you look at CapEx this year, we're looking at something similar. Plus, we should definitely draw down inventory of appliances and all I've mentioned before. So, I don't, I mean, I don't see any challenge. In the short run, if there's some timing, that may go up in the short run. But, I mean, we're so, we're being, I think, very, very cautious as it is. So, even if it goes up by 100 crosses.

I think that's clear. So we are reliant on the cash flow for funding internally.

Yeah.

Second question, if you could just help, if you could just help understand a little bit our last, our Boroughfield's last manufacturing arrangement with Boroughfield scientists. You mentioned in this presentation as well that the new production will be done on a corporate basis by BFL. And we already have some production which we have from BSL, which is probably equipment owned by BSL. So if you could just give us some overview on what is the arrangement on manufacturing for our board.

So this is, so firstly, it's an arm's length basis. The, it's, we have, you know, chartered and cost accountants who look at the cost and on a cost plus, you know, certain percent. Which is approved by, I guess, it's a related party transaction, which is approved by shareholders on both sides. We do that. And the cost, it says, the definition defers cases of assets are owned by BSL. So in that case, the cost is factored in a certain. In some cases, the cost of the capex is done by BL, in which case the cost obviously is higher, is lower for BSL. So the auditors do that, you know, as per say the accounting standards, they look into that and they, we arrive at a cost plus formula. If I'm not mistaken, right now it's cost plus 5%, which is the formula, but I may be slightly off, but I think it's roughly in that range. That's the transfer price at which BL buys from. But obviously that plus will differ if the asset is owned by BL or it's owned by BSL, and the cost also may differ. It's not fully audited and reported to the board or audit committee on both sides, and audit committee gets into the detail of it, and then finally shareholders pass it. So that's the way we do it.

Is there a reason to maintain this relationship? Is it possible to make it cleaner in terms of just moving all the assets to the end?

Yeah, but that will substantially increase the cost for bursa limited. That's the issue. We've thought about that. But because the equipment in many cases is the same as already being used by BSL, we have to double it and double the infrastructure and it will not be an immaterial increase in costs. So believe me, we've debated this and it's in the interest of shareholders of both companies. And specifically for Borosel Limited would have to again spend a lot more capex for actually very little return if we were to... You know, segregated. BSL, they are able to spread the asset, the same asset. So, they also get the benefit. So, it's kind of a marginal thing compared to the overall size of the business, at least till now. If it's, you know, a large chunk, then we'll have to obviously get back on the drawing board and re-look at it. But right now, it's not. It's less, at the moment, it's less than 10% of the sales of DL.

Thank you for that, and all the rest for the call.

Thank you.

Thank you. Raviza and gentlemen, we will take this as the last question. I now hand the conference over to management for closing comments. Over to you, sir.

Well, thank you for all your interest. In, you know, Borussia Limited, the last year has been a tough one. I do expect the next quarter or two, you know, with settling or still raging another, there to be some challenges in the short run. But as I said, we are not stopping our growth and expansion plans because of that. They're doing this for decades and not for quarters. So we are, as a team, fully committed to enhancing the revenue by 15 to 20% year on year and, you know, achieving a bidder of closer to 20% in the medium term. And we could really work on that journey. So thank you for your support and patience and also your continued interest. And I look forward to seeing you next quarter.

Thank you. On behalf of ICSA Security, that concludes this conference. Thank you for joining us, and you may now disconnect your lives. Thank you.