Excel Industries Limited Earnings Call Transcript, Nov 6, 2026

Ladies and gentlemen, good day and welcome to the Excel Industries Limited Conference call hosted by Cygnus Partners. 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. Today on the call, we have with us Mr. Ravi A. Shroff, Managing Director, Mr. Pradeep Gattu, President and COO, Mr. Devendra Dosi, CFO. Before we proceed with the call, a disclaimer that this call will contain forward-looking statements about the company which are completely based on beliefs, opinions, and expectations as of today. Actual results may differ materially. These statements are not the guarantee of our future performance and involve risks and uncertainties that are difficult to predict. A detailed Safe Harbor statement is given on page two of the investor presentation of the company, which is uploaded on stock exchanges and on the company's website. With this, I now hand the conference over to Mr. Ravi Shroff for his opening remarks. Thank you, and over to you, sir.

Ravi Shroff:

Thank you. Good afternoon, everyone, and thank you for joining us today. Before I begin, I would like to take this opportunity to wish everyone a very happy Dhanteras, a happy Diwali, and a prosperous New Year. Speaking about the quarter, the quarter witnessed challenging operating conditions in the agrochemical industry with the monsoon at approximately 87% of normal levels, which impacted overall agrochemical demand. When we spoke in May, we cautioned that the agrochemical demand was uncertain because of the risk of a suboptimal monsoon, but that risk has played out in more adverse manner than we had envisaged. We have delivered a robust performance in Q2 and H1 of FY27. This was despite significant underperformance of DETC in Q2, with quarterly sales at lowest level in the last 7 years. This shows a structural shift in our business model that makes our business more robust. During Q2 FY27, the revenue grew 2% year-on-year while EBITDA increased 22% and PAT grew by 42%. What is particularly encouraging is that our diversification strategy is beginning to translate into tangible results. The growth in the three focus areas we have spoken about in our earlier calls. Our Performance Solution business, YP derivatives, that is Yellow Phosphorus derivatives business, and contract manufacturing helped offset the cyclical downturn in our traditional agrochemical intermediates business. This is also reflected in our export performance, with exports increasing to INR81 crores in Q2 compared to INR47 crores in the corresponding quarter last year. Alongside the improvement in our business mix, better realizations, cost discipline, and welltimed raw material procurement supported a meaningful improvement in profitability. Our EBITDA margin expanded to 13.3% in Q2 and 13.9% for H1 FY27 versus 11.1% in Q2 FY26 and 12.5% in H1 FY26. This performance reinforces our focus on moving towards a more diversified business portfolio with higher share of Performance Solution business, YP derivatives, that is Yellow Phosphorus derivatives business, and Contract Manufacturing.

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Excel Industries Limited November 06, 2026 As communicated in May, the dedicated capacity for the 5-year long-term supply arrangement, which was announced in November 2025, was scheduled to commence operations in July 2026. I am pleased to share that the project was successfully completed on 23rd July 2026, in line with the committed timeline and customer requirements. Supplies under this agreement are now at full stream. This successful commissioning reflects our execution capabilities and further strengthens our position as a reliable Contract Manufacturing partner. Additionally, regular supplies under the agreement with a multinational company, which was announced in May 2024, are moving as per contract. We continue to engage with customers to explore further opportunities in this segment and will make appropriate disclosures as and when these materialize. In our Performance Solutions business, the additional biocides capacity commissioned in the second half of FY26 is fully operational. Our planned Q3 FY27 launches for new products in the Performance Solution range are on track. Further, in the YP derivative range, we are targeting to launch a new product in Q4 FY27. On the product development front, we believe the new products will further strengthen our offering and create additional growth opportunities. In our new product development we have seen benefits of our new corporate R&D center, which was operationalized in Q3 FY26. We have plans to further strengthen our corporate R&D center capabilities and infrastructure. Moving ahead, we expect the agrochemical market to remain subdued in the near term, with demand weakness likely to persist in Q3. In addition, raw material price volatility, supply availability and shipping disruptions may continue to create cost pressure during H2. However, our focus remains firmly on the businesses and the product categories that offer strong growth potential. While raw material availability and logistics will remain areas of close monitoring, our emphasis will continue to be on operational efficiency, product procurement, and disciplined cost management. At the same time, we continue to invest in building organizational capabilities through internal talent development and external recruitment to support our strategic growth priorities. Before I conclude, I am pleased to share an important milestone in our sustainability journey. Excel Industries has been awarded silver rating in EcoVadis Sustainability Assessment, placing the company among the 93rd percentile globally of the businesses assessed by EcoVadis. The rating reflects the continued strengthening of our sustainability management systems, deeper value chain engagement, improvements in environmental performance, and greater transparency in reporting. For us, sustainability is not merely a compliance requirement but an integral part of the way we operate. More importantly, as we expand our global footprint and strengthen our Contract Manufacturing and Performance Solutions businesses, this recognition will help reinforce our credentials as a responsible and reliable business partner. We believe it will support our engagement with existing customers and strengthen our ability to build relationships with new global customers.

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Excel Industries Limited November 06, 2026 In addition to this, the safety continues to be remain a key priority across all our manufacturing sites. We are pleased to have received 2 trophies at the Maharashtra Safety Awards 2025 for our Lote site. Our Roha site received the Safe-Tech Award 2026 for best employee training campaign and safety awareness excellence. Two of our safety executives were recognized as best safety professional of the year. These recognitions reflect our commitment to strengthening safety practices, employee awareness, and building a strong safety culture among across our operations. To conclude, I would like to mention that we remain focused on being diversified, competitive, and profitable. With a greater contribution of Performance Solution business, YP derivatives, and Contract Manufacturing over the coming years. With that, I would like to hand over the call to our CFO, Mr. Devendra Dosi. Devendra Dosi:

Thank you, Ravi-bhai. Good afternoon everyone and thank you for joining us today. Moving on to the financial performance for the Q2 and H1 FY27. On a standalone quarterly basis, the company reported revenue of INR274.6 crores in Q2 FY27 compared to INR270.2 crores in Q2 FY26 registering a year-on-year growth of 1.6%. EBITDA stood at INR36.6 crores compared to INR30.1 crores in the corresponding quarter last year. Also reflecting a growth of 21.5%. EBITDA margins for the quarter stood at 13.3%. Profit after tax was INR26.7 crores compared to INR18.7 crores in Q2 FY26. Moving on to H1 FY27, net operating revenue stood at INR568.3 crores compared to INR579.7 crores in H1 FY26, a de-growth of 2% due to a weak agro season with monsoon at 87% of normal. EBITDA for H1 stood at INR79 crores with a margin of 13.9% while profit after tax was INR55.8 crores, translating into a profit margin of 9.8%. Our balance sheet continues to remain exceptionally strong with a healthy net cash position. This financial strength provides us with the flexibility to navigate operational challenges while continuing to invest strategically in initiatives focused on improving margins and creating longterm shareholder value. That's it from my side. Wish you all a very happy Dhanteras and happy Diwali. We can now open the floor for question-and-answer session.

Moderator:

Thank you very much. We will now begin the question-and-answer session. The first question is from the line of Varun Singh from Karma Capital. Please proceed. Mr. Varun, your line has been unmuted, please proceed with your question. Due to no response from the current participant, we move on to the next. The next question is from the line of Siddesh from PL Capital. Please proceed.

Siddhesh:

Yes. Hi, am I audible? Hello?

Ravi Shroff:

Yes, audible.

Siddhesh:

So in the previous call, we highlighted competition from Chinese manufacturers and importance of maintaining dynamic pricing strategy. So just wanted to understand, given the current weak demand environment, how have been we able to sustain our market share across agrochemical intermediaries particularly DETC and NaTCP.

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Excel Industries Limited November 06, 2026 Ravi Shroff:

So specifically, response on agrochemicals, we've been able to maintain our market share. We have not lost market share primarily on DETC.

Siddhesh:

And also in investor presentation, we are at lowest levels in last 11 years for DETC sales. So given leading global position in DETC, what were key factors driving the sharp decline?

Ravi Shroff:

Primarily, this is linked to Super El Nino, as you are aware, in the agrochemicals and in monsoon related. And basically, that's what's created the weak demand conditions in India and LATAM, which are the primary geographies for these molecules.

Siddhesh:

Understood, sir. And DGTR recommending anti-dumping duties on HEDP and ATMP. How do we see the potential impact on domestic pricing and any competitive dynamics?

Ravi Shroff:

So the recommendation has been made by the DGTR. It has of course to go through the next phase. Even what has been recommended has already been also published. If it comes into effect, of course there will be an improvement in the domestic pricing for these products. And as and when that becomes effective, we should see better pricing realization.

Siddhesh:

Understood, sir. That's it, that's it from my side, sir. Thank you.

Moderator:

Thank you. The next question is on the line of Darsh from JK Capital. Please proceed.

Darsh:

Good afternoon, sir. Just a couple of questions from my end. So DETC sales were at their lowest Q2 level in 11 years. Beyond the weak monsoon, how much of this, like, reflects customer destocking or competitive pressure? Like, what indicators would signal a recovery?

Ravi Shroff:

So primarily this is linked to El Nino and poor weather pattern. As far as the customer destocking, just give me a moment. So as and when the weather conditions improve and of course, destocking is completed, as and when the demand revives, we are well prepared to take up any demand that comes up. And as and when the recovery happens, we'll be well positioned to capitalize on that.

Darsh:

Okay. And like, Q2 exports increased to INR81 crores from INR47 crores last year. So which products and markets drove this increase, and was it supported by repeat orders or few large shipments?

Ravi Shroff:

So the exports increased due to focus, due to the focus areas that we have mentioned. And primarily our focus areas of performance solutions as well as to some extent contract manufacturing have contributed to this growth. This is actually a growth which is expected to be sustainable growth, not a one-off single order kind of growth. And this is also largely due to some of the new products we have introduced, new customers that we've been able to obtain, as well as certain new geographies we've been able to make breakthroughs in.

Darsh:

All right, sir, that's all from my end. Thank you so much. And all the best.

Moderator:

Thank you. The next question is from the line of Varun from Karma Capital. Please proceed.

Varun:

Am I audible?

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Excel Industries Limited November 06, 2026 Ravi Shroff:

Yes.

Varun:

Yes, sure. Thank you for the opportunity. So, can you talk about the scalability, opportunity for the new growth engines like Performance Solutions, Contract Manufacturing, etcetera.? So, like, over next three years, what's the overall potential especially from the EBITDA point of view? You think these investments can unlock by maybe FY29?

Ravi Shroff:

So translating this into the numbers you're expecting is a little bit too specific. However, I can make some general comments. These are large consumption products across several geographies as well as, as I shared in the earlier question, we've been able to make some breakthroughs in certain new geographies as well. So these are all global usage products, as well as there are some products which are smaller niche products where we are market leaders. Even those kind of products, we have seen some opportunities and growth. As far as contract manufacturing is concerned, of course, our perspective is very much global on this. While we have domestic opportunities coming up as well, we are quite agile and focused on looking at certain global opportunities in the contract manufacturing space. So over three years, both these areas are expected to contribute towards whatever growth objectives that we are looking at. And we also have classified them internally as focus areas. So we will continue to expand new geographies, new customers, new products, as well as contract manufacturing, new relationships, and new agreements.

Varun:

Got it, got it. And my second question.

Ravi Shroff:

Sorry, just to add, we already made some capital commitments which we have been sharing in our calls in terms of, how much capital we are deploying. So, for example, we are setting up new multipurpose facilities at one of our sites, and this kind of investment, as we continue to do these, these will support the growth initiatives.

Varun:

Understood, understood. And secondly, can you talk about the guardrails for incremental capital allocation that we are doing? So I mean, what are the benchmarks that we are considering, especially in terms of return on capital employed? So how, as an investor, we should think about, the company's sustainable ROCE over the next 3-4 years?

Ravi Shroff:

So basically, as we've shared in our earlier calls as well, whatever capital investments or capital deployment we do, we are looking at a 1.5 to 2 fixed asset turnover ratio on those. From an ROCE perspective, we will be targeting, anywhere 15% to 20% ROCE closer to 20% preferably. In some cases, this is blended I'm talking. Some products may give better ROCE, some products, will come slightly below. But on a blended basis, this is what we are looking at from an ROCE perspective. Does that cover your question?

Varun:

Got it, got it. Sure. Thank you very much and wish you all the best.

Ravi Shroff:

Thank you.

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Excel Industries Limited November 06, 2026 Moderator:

Thank you. The next question is from the line of Samar Singh from TPS Capital. Please proceed.

Samar Singh:

Yes, good afternoon. Thank you for the opportunity and happy Diwali. My first question was on the revenue mix for the half year, if you could give us that between agro performance solutions, phosphorus derivatives, API, and contract manufacturing.

Ravi Shroff:

Just give me one moment. So while, may not be possible to give you an exact breakup, but I can tell you since agro has been a key focus and a lot of times we keep getting asked this question, for first half of the year agro is at 35%, non-agro is 65% of the mix.

Samar Singh:

Great. And this contract manufacturing, have we, I think you were hoping to do about INR15 crores a quarter on full ramp of both the contracts. So have we reached that level?

Ravi Shroff:

Yes, we are on track. Yes.

Samar Singh:

Great. And, on if we, just last year I think we had reduction in our gross margins because of, sort of a lag in increasing our pricing versus increased raw material costs. So in this, now we're currently running at about 51% gross margin. How much of that could be sort of contract manufacturing and the other businesses higher margin businesses coming into play? How much of that would be just catch-up from in pricing from last year? And how much would be sort of benefit we got from inventory build-up?

Ravi Shroff:

So I just wanted to add one more point to what I mentioned earlier as well before we move into your current question that whenever there's an upcycle in DETC, there's a turn in the cycle, this will go in our favour and we will get the benefit of that as well. I just wanted to add that to your previous question. As far as the margins are concerned, there's an improved product mix as I was sharing, and we have shared this in the previous calls as well, that we want to focus on EBITDA accretive and margin accretive businesses. And the contract manufacturing is high margin for us. There's and also the performance solutions, also we have seen better realizations and higher margin. So this has contributed. Second factor in this has been timely procurement and proactive procurement of raw materials. And there has been a lot of volatility in and challenges in availability of raw materials. So we have done that as well. So this and, of course, a better mix between the products, has created the better margins. Yes. And we expect the volatility to continue into Q3 and Q4 as far as raw materials go, pricing, difficult to take a call at that point. But, we'll try and pass on the pricing as much as possible.

Samar Singh:

I guess my question, is how much of this improvement in margin is sort of structural because of better product mix, and how much of it could be just because, we had low-cost inventory on our balance sheet?

Ravi Shroff:

It's a combination of both. I can't give you an exact breakup because, of course, the Contract Manufacturing business as well as Performance Solution businesses that we have added, they are at a better margin than previous. And, I would say that's played a significant role as well as the procurement also has had some part to play. But not possible to give you an exact breakup.

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Excel Industries Limited November 06, 2026 Samar Singh:

Got you, no problem. And on, you mentioned about DGTR coming out with the recommendations for ADD on organophosphonates. So I think one, if I'm not mistaken, it's not a very high duty. I think it's about 15% to 20% above of the cost. And secondly, I think from what I could tell, the amount of the imported from China, that seems to be about maybe 12% to 15% of the total domestic consumption. And given our competitor having a large, underutilized capacity, do you think actual pricing will increase post even if the ADD is implemented?

Ravi Shroff:

So we have reason to believe that the prices will definitely improve. Historically, China has been, at least in the past, dictating prices these products, not just for India but on a global front. Few geographies globally already has put in place an anti-dumping duty. When that kind of situation happens, typically the Chinese companies like to push their products into geographies where they don't face this anti-dumping duty. India was one of those geographies. There was no anti-dumping duty. If the anti-dumping duty does go into effect in India as for, the next stages it is supposed to go through. We'll definitely better realization and better margin profile for these, and hopefully the domestic players will be able to capitalize fully on these opportunities.

Samar Singh:

And what capacity are we currently running our plant at…utilization?

Ravi Shroff:

There is definitely an improvement in this utilization. I cannot give you an exact number on what capacity utilization.

Samar Singh:

And this, the ADD was only on the acids, so is it possible that imports will come in from those also formulations or that is not happening?

Ravi Shroff:

Right now, it's specific and focused to these two areas, so I can't comment about what else could be in the future.

Samar Singh:

No, but is the product interchangeable, in acid form versus salt or formulation form?

Ravi Shroff:

Give me one moment. Yes, it is possible to interchange but taken when the applications were made as well. Any circumvention, if it happens, we'll have to find appropriate ways to deal with it.

Samar Singh:

Got it. And last question from my side, do we manufacture PBTs?

Ravi Shroff:

Can't give you a response on this.

Samar Singh:

Okay, I'll get back to you. Thank you.

Moderator:

Thank you. The next question is from the line of Soumya Raghuvanshi from Nirwa Securities. Please proceed.

Soumya Raghuvanshi:

Good afternoon. Thank you so much for the opportunity. So the standalone inventory increased to around INR262 crores in September from INR129 crores in March. Despite lower H1 revenue, what drove this build-up and when do you expect it to convert into sales and operating cash flow?

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Excel Industries Limited November 06, 2026 Ravi Shroff:

So as I shared earlier, there was a lot of volatility in the raw material prices and also there was availability. So we thought it was prudent to increase the inventory levels, particularly for our critical raw materials. It was done with the view that we should maintain continuity of supplies and as to be seen as a reliable supplier for these products. And we have benefited in terms of the ability to service customers and also control our RM cost because of that, which is also reflecting in our improved gross margin.

Soumya Raghuvanshi:

All right, all right. Sir just one last question from my end. Within the planned INR200 crores to INR300 crores capex over three years, how much is committed versus discretionary, and which projects have priority, and what utilization and return thresholds guide further investment?

Ravi Shroff:

Give me one moment to respond.

Soumya Raghuvanshi:

Yes, sure, sir.

Ravi Shroff:

So as far as the areas are concerned, we have already specified which focus areas which we will be focusing on growth. So it will be in those three focus areas, YP derivatives, Performance Solutions, as well as Contract Manufacturing. We have roughly committed about 50% of whatever, about INR150 crores is what we have committed. As far as any new opportunities, as we have shared in previous calls as well, these have to be EBITDA accretive, fixed asset turnover ratio we estimate will be 1.5 to 2, and from an ROCE perspective, we'll target close to 20% ROCE on these products.

Soumya Raghuvanshi:

All right, sir, got it, got it. So that was really helpful. Thank you so much, sir. All the very best.

Ravi Shroff:

Thank you.

Moderator:

Thank you. The next question is from the line of Madhav Agarwal from SKP Securities. Please proceed.

Madhav Agarwal:

Hi, hi, thanks for the opportunity. So sir, I wanted to know that in the current quarter we have seen a good margin expansion, right? So I wanted to know whether we can sustain this margin expansion and profitability growth, like even in the absence of meaningful recovery in the agrochemical business. Hello?

Ravi Shroff:

Just give me one moment.

Madhav Agarwal:

Yes.

Ravi Shroff:

So, on a structural basis we believe we'll be able to sustain these margins. There could be shortterm pressures on certain products, and as I shared earlier, depending on the recovery cycle of agrochemicals, if it turns in our favour, of course we can see even better growth, and maybe hopefully bottom line also could improve substantially from here.

Madhav Agarwal:

Okay, okay, that's helpful. And sir, like, if you look beyond FY27, so what are the key growth drivers that you would like to point out for the next two to three years?

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Excel Industries Limited November 06, 2026 Ravi Shroff:

So, we've been sharing on our previous calls as well, Performance Solutions is one area which is already shown growth in H1 of this year compared to H1 last year. We will continue to invest in that segment. In that, we have made some announcements as well, like biocide capacity we have increased, for example. There are certain other new introductions and new products coming in this quarter as well as the next quarter. So, all of these are under Performance Solutions, as well as in our YP derivatives, which is Yellow Phosphorus derivatives product category group. This is what is going to be the focus areas, and Contract Manufacturing, we already have two active contracts, which both of which we have disclosed. There are several Contracts Manufacturing opportunities in the pipeline that we are at discussion or development or some kind of phase pre-contract. As and when these materialize into a contract, we will make the disclosures. However, again, these are a mix of global as well as domestic opportunities, and these will all be adding to our growth. As shared on the one of the previous questions as well, we have an MPP that is coming up in one of our sites, multi-purpose plant, which will be supporting this kind of growth opportunities. As well as we have expanded some capacities in which have been announced earlier. So combination of the expanded capacities, new products, and the capacity coming up in pipeline will be supporting the growth.

Madhav Agarwal:

Okay, okay. And sir, like finally I wanted to get some details on your contract manufacturing business. So how is it progressing in terms of customer additions, order pipeline and the capacity utilization? And are you witnessing any increased outsourcing opportunities from global customers as well?

Ravi Shroff:

So, both the contracts that we have currently are progressing well. We are operating at whatever expected capacity from the customers. Was that your question? Did you have something else you wanted to know as well?

Madhav Agarwal:

Yes, yes, that's, and that's it, that's it. Yes, thank you.

Ravi Shroff:

Okay, thanks.

Moderator:

Thank you. The next question is from the line of Love Gupta from Counter-Cyclical Investments. Please proceed.

Love Gupta:

Hello, sir, thank you for the opportunity. So I just had a suggestion, since our stock is trading at least below half times the book value and also below our investments, why don't we consider a share buyback to, reward our shareholders? Now would be a great time to do that.

Ravi Shroff:

Thank you for your suggestion. We will consider at appropriate time.

Love Gupta:

Thank you.

Ravi Shroff:

We will discuss this with the board.

Moderator:

Thank you. The next question is from the line of Varun Mishra from SG Capital.

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Excel Industries Limited November 06, 2026 Varun Mishra:

Okay, hi, thank you, sir. A couple of questions from my end. So the gross margin had improved sequentially to 50.6%, like, while the EBITDA margins declined from 14.4% to 13.3%. So what explains this divergence, and what were, like, any key concerns regarding costs in Q2?

Ravi Shroff:

So, I've shared some of this already earlier. There's inventory that we are carrying which supported, which was lower cost inventory. Some of this is getting replaced by inventory which is at a higher cost. So some of the changes that you're seeing are because of that. Also, the product mix has undergone change. And as I shared earlier towards the call, agrochemical intermediates was even lower than, worse than the previous quarter. So from that perspective, there's a change that has happened on the overall combination of these two has created the change in the overall EBITDA margins.

Varun Mishra:

All right, sir. And so you also highlighted that YP Derivatives has an offset for agrochemical weakness. So which end-use applications are driving the demand and how do you see the growth in terms of volumes, like which is coming? Like is it through value realization or is it coming from volumes?

Ravi Shroff:

So, it's not just YP derivatives that has offset, but the entire basket of non-agro. As I shared earlier in the call today, the overall revenue of agro for H1 is, sorry, Q2 has dipped down to, sorry, H1 has dipped down to 35%. 65% is non-agro, which was not the case earlier. The growth has been in all of our other areas which are non-agro, which includes Performance Solutions, YP derivatives, as well as Contract Manufacturing. And in Contract Manufacturing, as we have shared earlier, some of our contracts, one of our contracts is on, not on a basis of the pricing of the raw materials. So in that case, the top line and bottom line is accordingly adjusted.

Varun Mishra:

All right sir.

Ravi Shroff:

What was your question? Did it get covered?

Varun Mishra:

I wanted to understand like in terms of growth, like how are we seeing that? Is it because of the volumes or is it because of the value realizations?

Ravi Shroff:

So, it's a combination of volume and value and of course the focus areas delivering the growth, right. The three focus areas that we have mentioned, all three have become growth engines for the company. And all three have played a part in compensating for this quarter. Hopefully this compensation will turn to its own engine of growth in the coming quarters and sustainable growth engine.

Varun Mishra:

All right, sir. Okay, that's it from my end, sir. Thanks a lot.

Moderator:

Thank you. The next question is from the line of Samar Singh from TPS Capital. Please proceed.

Samar Singh:

Yes, thank you for the follow-up. Just one question on our, on the agro business. We mentioned that we're still seeing headwinds in Q3. One of our competitors has come out and said that they are suddenly seeing strong demand in October and November, and lack of competition from China is helping that demand. So, it's a good so are we not seeing a similar setup?

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Excel Industries Limited November 06, 2026 Ravi Shroff:

I will just get our CEO to respond to this question. Pradeep? Yes.

Pradeep Gattu:

Yes. So as far as the agrochemical intermediates is concerned, it's a fact that shipping from China has become difficult. So to that extent, it helps that the competition is restricted to domestic competition. But as far as the full-fledged recovery is concerned, we are not seeing it recovering full-fledged into Q3. And here one major factor which comes to play is that we have a much larger capacity in the agrochemical intermediates that we are talking about. The, we have a very large capacity, so reaching the full capacity utilization for us will take a longer time vis-a-vis someone who is having a lower capacity. So I hope that answers the question.

Ravi Shroff:

And to add to that, Q3 anyways is a dip quarter for this because the post market, it goes into post-monsoon. So, just to help you understand a little better.

Samar Singh:

And how many domestic players are there in the DETC space?

Ravi Shroff:

There are, largely there are two players in this.

Samar Singh:

Right.

Ravi Shroff:

Yes.

Moderator:

Thank you. The next question is from the line of Prashant, an investor. Please proceed.

Prashant:

Hi, thanks for my opportunity and I hope I am audible.

Ravi Shroff:

Yes, you are audible.

Prashant:

Yes. My question is specifically to Mr. Ravi Shroff. You have a large investment in Silox India Private Limited. The market value of that investment could be, I guess, around INR500 crores, and the dividend yield on that would be roughly around 2%, 3%. For a company that is looking for growth and expansion plans, what are your plans to monetize and en-cash this investment and use it for more productive purposes? Hello?

Ravi Shroff:

Yes, you're audible. Just give me one moment. We will not be able to give any specific comments on this at this point in time. As and when appropriate decision is taken by the board, or it's taken by the board at whatever point in time, we'll definitely communicate to you.

Prashant:

So that is understood, Mr. Shroff. My point is, keeping such a large amount with a dividend yield of 2%, 3%, specifically when you are targeting an ROCE of 15%, it is not an appropriate capital allocation policy. So fine, I mean, you may not give, I am not asking for a decision right at the moment, but is it in the works? Have you and the management and the board thought about it? Have you taken any steps in this matter? If you can give a sense of direction, that will be helpful.

Ravi Shroff:

Management and board are both definitely aware of this because this gets reported to the board, every half-yearly it's reviewed as well as full year. So both the management and the board are

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Excel Industries Limited November 06, 2026 very much aware of this. As I said, specifically I can't give you any response on what attempts have been made. But the awareness is definitely there and it does get discussed. As I said, at appropriate time when the decision is taken, we will be happy to communicate that to the shareholders. And also to address your specific question/concern, yes, the board is also very much aware of this matter and seized of this matter. Yes. Prashant:

Okay. So can we expect it rather sooner than the later?

Ravi Shroff:

That comment I cannot make. It is going to be a decision of the board at the end of the day. As I said, the awareness is there, and, of course, if an opportunity does arise, the board will consider it. If there's an outcome from that, we will definitely convey the outcome to the shareholders appropriately. I must also add that the business has done quite well over the last 25 years. This, particularly the last eight to 10 years, what it reflects on our balance sheet has definitely gone up. And as I shared, the board is aware of this.

Ravi Shroff:

Absolutely. Silox has a turnover of INR1,600 crores, 16% EBITDA margin, cash in balance of around INR250 crores. So I think that would be a right opportune time to monetize and put it in our own business unless, I mean, we consider investment as our core activity. So, well, anyway, I mean, since you are, since you have, we will go with whatever you have said and we'll look forward to some better commentary in the coming quarters. Wish you all the best.

Ravi Shroff:

I just want to add one comment that as far as the company's growth plans are concerned, we continue to pursue those. So we are not compromising the company's growth plans because of this investment. So I just want to definitely address that part of your question that the company is not impacted because of this holding. Yes, there are opportunities that we are seeing for our growth plans. We are funding it largely from internal accruals as well as whatever is on our balance sheet today. And we have stated in the past that we will continue to pursue and continue to invest in growth for Excel Industries.

Prashant:

Absolutely, no doubt about that, Mr. Shroff. It's just that, I mean, we, once you, if this kind of fund is available, like one of the earlier question was there, it could help you in enhancing shareholder value. You could think of a buyback, and that would do wonders to your market value, to your ROCE, to your financial numbers, and it would give more wherewithal to the board and the management to pursue more aggressive opportunities. That's all my limited point was.

Ravi Shroff:

Yes, thank you, thank you. We have noted your point. Yes.

Moderator:

Thank you. That was the last question. On behalf of Excel Industries that concludes the call. On behalf of Excel Industries Limited that concludes this call. Thank you for joining us and you may now disconnect your lines.

Ravi Shroff:

Thank you.

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