Globus Spirits Limited (GLOBUSSPR) Q4 2026 Earnings Call Transcript

Ladies and gentlemen, good day and welcome to Global Spreads Ltd. Q4 and FY26 earning conference call. As a reminder, all participant lines will be 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 touchstone phone. I now hand the conference over to Mr. Suyash Samanth from Stellar Investor Relations Advisor. Thank you, and over to you soon.

Thank you. Good afternoon, everyone, and thank you for joining us today. We have with us today the Senior Management Team of Global Spirits Limited, Mr. Shekhar Swaroop, CEO and Joint Managing Director, Mr. Paramjit Sengil, CEO of the Consumer Division, and Mr. Nilanjan Sarkar, Chief Financial Officer, who will represent Global Spirits Limited on the call. The management will be sharing the key operating and financial highlights for the quarter and full year ended 31st March 2026 followed by a question and answer session. Please note, this call may contain some of the forward-looking statements which are completely based upon the company's beliefs, opinions, and expectations as of today. These statements are not a guarantee of the company's future performance and involve unforeseen risk and uncertainties. The company also undertakes no obligation to update any forward-looking statements to reflect developments that occur after the statement is made. I now hand over the conference to Mr. Shekhaz Faroo. Thank you, and over to you, sir.

Thank you, Suyash. Good afternoon, everyone, and thank you for joining us today for the Q4 and FY26 earnings call. I assume you reviewed the investor presentation uploaded to the exchanges on our website. Param and Nelanjan are also with me on this call. In the year gone by, we have executed a structural overhaul across multiple facets of the business this year, and the underlying growth in our core areas is exceptionally strong. Let me once talk about the fundamental architecture of the business before coming to operational updates. We operate our business with a consumer focus built upon a solid manufacturing base. This dual structure allows us to innovate rapidly in the Alcobev space with the lowest cost of production and the fastest time to market. This is not just a structural setup, but also a financial engine. The robust cash flows generated by our manufacturing operations act as the primary funding mechanism for the aggressive expansion of our consumer business. Our consumer portfolio is segmented to drive specific strategic outcomes. Regular and others is our core category. It delivers high volume and deep distribution across our core markets of Rajasthan, UP, Delhi, and West Bengal, offering superior value to the conscious consumer. Prestige and above is our future core category, operating at substantially higher per unit contribution. This segment is a vehicle for our geographic expansion and is systematically driving up our average realizations per case. Within the P&A segment, we have isolated a luxury segment. These brands are not just premium offerings, they are market makers designed to define categories and lead consumer trends. We take immense pride in the fact that our portfolio has secured 34 national and international awards. To quantify the shift that's been taking place in the business, in FY26, nearly 40% of our total revenues came from the consumer portfolio. And within this, P&A contributed 16% of the revenue. Just by example, in FY24, the P&A business contributed just 6% of our total consumer revenues. Coming to some manufacturing updates, Parang will, of course, give you a deep dive in the consumer business. I'll talk about the manufacturing updates now. Following the commissioning of our UP distillery last quarter, our installed capacity base stands at 334 million liters per annum. This marks the culmination of the capacity enhancement journey we initiated a few years ago. We now operate six highly flexible distributors strategically located across the raw material and consumption hubs of North and East India. For the year, we achieved a strong 80% capacity utilization, adjusting for the UP startup period. Our multi-raw material, multi-product strategy has successfully stabilized our margins, delivering 6.2 rupees per liter EBITDA for FY26. And 8.3 rupees per liter for Q4 FY26. I want to proactively address some concerns around volume pressure and revenue dynamics observed in this segment for the quarter gone by. We executed a strategic shift in our Bihar and Dhartan facilities, transitioning from predominantly ethanol production to a mix of ENA and ethanol. On the back of lower offtake of ethanol by oil marketing companies, because E&A currently commands a lower market price than ethanol, this shift naturally contributed to a slight top-line revenue drop. More importantly, the supply and dispatch cycle for E&A is inherently longer due to the web of state permissions required. This friction resulted in a one-time inventory buildup at our facilities during Q4. This is obviously a timing issue, and we do not see this as a demand issue. This liquidity, this inventory buildup will get liquidated in Q1. Additionally, optimizing our raw material feed between maize and rice requires certain technical changes. For instance, when we run our eastern plants entirely on maize as opposed to rice, the system derates our total capacity by 75 kL for those units, 75 kL per day. This de-rating is a known operational variable that we actively factor into our profitability models when deciding between maize and rice procurement. We're obviously optimizing for margins and cash flow, and not just absolute volume. Some macro tailwinds and strategic outlook going ahead, we've positioned the manufacturing business to capitalize on three distinct trends. First, ethanol blending. We are seeing that the national mandates for ethanol blending is on the up, and we forecast strong and sustained demand growth. Second, there's a global ENA arbitrage available. The current global environment has presented an opportunity with elevated global energy costs, severely constraining international ENA supply. We have actively pivoted to exploit this, and our facilities in Haryana, Bihar, and UP are already operationally geared for large-scale ENA exports. In Q4, we started this journey and exported 3.7 million liters. This opportunity is an additional volume driver for us. Third is obviously the situation in Bihar. We are actively monitoring the legislative landscape and policy regarding prohibition. If or when that market reopens, the first mover advantage should be significant. Because we have a fully operational footprint in the state, we are perfectly positioned to take advantage of this opportunity. Finally, I want to provide clarity on the enabling resolutions for a fundraise. Over the past few months, we have proactively engaged with the investor community. These conversations have been highly productive, providing us with a clear validation of our strategic roadmap and conforming strong institutional appetite for the global consumer story. However, as we move into the execution phase of our FY27 business plan, the immediate necessity for external capital has been abated. Two factors have shifted our stance. Number one, internal accruals. Our revised business plan demonstrates a cash flow trajectory that is stronger than was initially projected around Q2 or Q3 of last year, allowing us to self-fund our current growth initiatives. Secondly, debt optimization. We have successfully renegotiated our debt terms, fundamentally improving our liquidity profile and reducing our cost of capital. Nilanjan will talk more about this later today. While we continue to evaluate opportunities and maintain a dialogue with potential investors within the validity period of our resolution, we are in no immediate pressure to dilute equity at this stage. Our priority is clear. We will leverage our robust internal engine to drive towards our FY29 goals. Param, I request you to take us through the consumer business performance.

Thank you, Shekhar.

And good afternoon, everyone. Starting with the prestige and above, the P&A segment, FY26 delivered a robust aggregate performance with revenue increasing 27% year-on-year to $164 crores and volumes rising 31% to 1.19 million cases. Surpassing the 1 million case mark is a critical milestone for this business. However, looking strictly at the blended top-line growth masked the true underlying momentum of our P&A portfolio. To accurately contextualize our performance and to understand where this business is heading, it is necessary to break down our market architecture. Our distribution strategy is built on two distinct classifications, core markets and emerging Thank you. Thank you. Thank you. Thank you. Core markets are those where we have surpassed three full years of operations. These are the engines of near-term volume growth and profitability. We currently have five core markets, four of which are already profitable. Emerging markets are those in the 0 to 3-year gestation phase. These geographies require foundational investment. And are systematically being groomed to transition into core markets, at which point they will contribute significantly to the top and the bottom line. We began this journey four to five years ago, and our pipeline is functioning precisely as designed. Let me chat a bit about the Delhi impact and the underlying growth. Within our core markets, Delhi has historically been an outside contributor. Representing 33% of our total volumes in FY25. In FY26, a specific isolated disruption in Delhi severely impacted our aggregate growth. Delhi volumes in Q3 FY26 dropped drastically to 60% of the Q3 FY25 volumes. While we engineered a short recovery in Q4 FY26, Bringing Delhi volumes back to 90% of Q4 FY25 levels, the Q3 trough diluted Delhi's share of our overall business to 23% for the full year. When we isolate and remove the Delhi anomaly from the data, our P&A business grew at an exceptional 58% year-on-year. This 58% inline growth rate aggressively outpaces industry benchmarks and demonstrates the immense traction our brands possess where operations are uninterrupted. Furthermore, as our emerging markets scale and transition into core markets, our reliance on any single state, like Delhi, is systematically diluting. This provides a structural hedge against state-specific volatility. And secure the more stable accelerated growth journey. Coming to operational and regional updates, in Q4 FY26, specifically, E&A revenues stood at Rs. 40 crores, reflecting 34% year-on-year growth, with volumes up 39% to 0.29 million cases. We are executing a clear path towards profitability, effectively reducing losses within this segment. Overall, the segment generated an EBITDA level loss of Rs. 5 crores in the quarter and Rs. 9.4 crores for the year. Regionally, the North continues to function as our primary springboard, followed closely by the East. In the North, we have doubled our execution in UP, penetrating deeper into Tier 3 and Tier 4 cities, and expanding the availability of our portfolio in Haryana and Rajasthan. We are simultaneously expanding our luxury footprint into smaller, affluent markets. In the East, following the stabilization of West Bengal, we advanced into Assam in Q3 and initiated operations in Jharkhand last month. The early data is highly encouraging, validating our strategy to expand our portfolio in these states. In Assam, we have already initiated phase 2 of our geographical spread this quarter, establishing the east as a definitive second growth engine. Now coming to regulars and other segments. Transitioning to the regulars and other segments, Q4 FY26 revenues stood at Rs. 224 crores, reflecting a top-line growth of 2% year-on-year, with volumes holding stable at 3.97 million cases. EBITDA for the quarter, however, outpaced revenue, expanding by 8% year-on-year to Rs. 41 crores. For the full year FY26, revenue was 900 crores, up 4% with volumes at 15.7 million cases, and EBITDA delivering a 12% expansion to Rs. 158 crores. The headline volume growth in this segment requires immediate contextualization, as it masks a deliberate and aggressive structural overall of our operational footprint. During FY26, we executed a strategic wind-down of our legacy portfolios in key markets, specifically West Bengal and Haryana. This was a calculated near-term absorption of the volume pressure. We intentionally cleared the channels in these geographies to prepare for the deployment of an entirely new, highly optimized portfolio in the near future. While this transition inherently suppressed our aggregate growth, it was a necessary structural reset. That transitional phase is now decisively behind us, and the rebasing of this segment is complete. The operational constraints of FY26 have effectively created a coiled spring. We are already deploying the catalyst to unlock this pent-up momentum. We are highly confident that UP will emerge as a massive growth engine, and we have backed that conviction by introducing our full range of brands, adding five new SKUs to the market. Simultaneously, we are attacking the sluggishness in Rajasthan head-on. We are sequentially injecting four new-to-category brands to expand consumer choice. Re-ignite category growth, and aggressively reclaim market momentum. Investors should view the F26 RNO performance not as a plateau, but as a foundational exercise. With the imminent portfolio injections in West Bengal and Dhariana, the rapid scaling of UP, and the strategic interventions in Rajasthan, we are entering the new fiscal year at a very definitive inflection point. I now request Nalindan to continue with his speech on the financials. Thank you.

Thank you, sir, and good afternoon to everyone. Following the strategic overview provided by our joint MD, I will now detail the financial mechanics and balance sheet developments executed during Q4 and the full year FY26. Our mandate for FY26 was not just revenue expansion, but rigorous balance sheet optimization. We have aggressively refined our capital profile to ensure our financial foundation is as formidable as our operational footprint. Debt optimization. The most critical intervention this quarter was the optimization of our long-term debt profile. We recognized an inefficiency in our cost of capital and executed a comprehensive strategic refinancing of our existing term loans. This proactive step acts as a massive catalyst for free cash flow. By leveraging our strengthened credit profile to secure superior interest rates and optimizing the repayment schedule, we have systematically reduced our annual debt outflow from 67 crore per annum to just 14 crore projected for FY27. This action alone unlocks 53 crore of direct liquidity in the coming year. This is unencumbered cash flow that is immediately available to fund the consumer business expansion, entirely bypassing the need for external equity. Through this refinancing and broader treasury management, we have driven down a blended rate of interest, combining all forms of borrowing by a full 50 basis points. Now, let me touch about deleveraging and capital efficiency. While we are expanding our consumer footprint, we are simultaneously deleveraging the enterprise. In FY26, we reduced our absolute borrowings by 57 crore compared to FY25. We are funding our growth through internal accruals, not the balance sheet. The disciplined capital allocation has resulted in a radical improvement in our solvency and return metrics. Current ratio, we have successfully driven our current ratio from 0.96x in FY25 to 1.01x in FY26. Crossing this 1x threshold is a critical indicator of structural health. It proves that our aggressive interventions in working capital management have eliminated short-term liquidity deficits, The interest coverage ratio has improved from 1.76x in FY25 to 3.14x in FY26. We have nearly doubled our safety margin, effectively de-risking the enterprise against macroeconomic volatility or interest rate shocks. Return on equity. Ultimately, our capital strategy is measured by the value generated for shareholders. Through the combination of debt reduction, lower interest burdens, and optimized asset utilization, our return on equity has increased threefold, three X, in FY26 compared to FY25. I now leave the phone to the moderator for questions and answers. Thank you.

Thank you so much, sir. Ladies and gentlemen, we will now begin with the question and answer session. Anyone who rushes to ask a question may press star and one on their touchtone telephone. If you wish to remove yourself from the question queue, you may press star and one. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question assembles. Our first question comes from the line of Avnish Roy from Noama Wealth Management. Please go ahead.

Yeah, thanks and congrats. My first question is on the consumer part of the business of E&A. Overall, the year ended on a strong note, and clearly, Delhi will soon come back to growth. What kind of growth would you be targeting for P&A for FY27? And given favorable policy changes in some of the states like Karnataka, where they are saying that based on liquor content, alcohol content, taxation, that activity will be there. And maybe some more markets and maybe UP is a big market for you, given you have entered a few quarters back. What kind of growth you will be targeting in P&A and maybe even the regular also, if you could give some kind of a guidance. Thank you.

Thank you. Thanks, Avneesh. So, you know, coming to the second part of the question, you know, after, as of now, we do not have presence in south with reference to the Karnataka landscape change, but we intend as soon as we strengthen our ease, then obviously we intend picking up the next region, and those are greener pastures for us. UP, each and every positive opportunity we are going to leverage because UP, we have a full presence with a captive distillery where the expansion has ensured that we are servicing that requirement. On the growth target, Abneesh, we are totally committed to delivering the F29 objective, which we said that we are going to ultimately work towards managing a 50% total growth on our P&A portfolio, and we are totally committed to that. Time to time, there will be quarters up and down where some growth projections will either exceed expectations or fall soft, and we would not like to give, you know, piecemeal commitments to growth at this stage.

Understood. Now, a follow-up to what you said, Eastern India is clearly a big opportunity, especially given what has happened in Bengal. Why I wanted to highlight first Bengal was clearly same party runs in government in Nukta Padesh, which I think is one of the best examples of how favorable liquor policy should be there for customer, government, and for the industry. So do you think any changes possible in Bengal, medium, long term, given new government, or the Bengal taxation or policies are reasonably good? And second follow-up on Eastern India is obviously on the most important state from your side, Bihar. Bihar, one, is the current chief minister, the new chief minister, just a few months back, had highlighted the loss of opportunity given the taxation impact. Thank you. So, would you think that at some stage, clearly, government would want to open up any initial talks happening? And second is, supposing at some stage, and this is not some timeline I'm putting from a FI27 or FI28 perspective, I'm just saying, currently, you do utilize your current assets in Bihar. Supposing there is a reasonable opening of Bihar market at some stage, then what changes for you? Because already, obviously, B2B and exports are happening. Thank you. Then what changes, either from revenue or profitability perspective? I know a lot of things are unknown, given taxation, but we have seen Andhra market, for example, open up, right? It was restricted to local players. So some clarity, I'm asking, not full clarity.

Thanks, thanks, Adnish. See, on West Bengal, while at this point of time, we have a corporation market and… Private retail. Our subject is obviously such a constrained subject that there is always opportunity to become more liberal in the excise policy to propel West Bengal to the next level of growth. My thought is that over the medium term, the environment to operate Alcobo industry, especially spirits in West Bengal, is likely to get more favorable, and that is something we are very keenly waiting and looking forward to while we build our strength in the state. So from my side, we are holding and watching like you are, but overall, it is likely to move into a more positive zone in the medium term. Thank you. Coming to Bihar, see, Bihar, in my personal view, is going to open, it's a question of when, because, you know, it's surrounded by all sides with states aggressively reaping in a lot of revenue from our category, and there is no reason why it should just be missing out on it. The one change that will happen when Bihar opens, whether selectively in about two, three steps, or overall in one step, will be that... When Globus entered the P&A segment about four and a half, five years ago, we came in brand by brand. We built a momentum for the brand, learned our lesson. But now when Bihar opens, we will have the full portfolio moving in like any strong and a stable organization. So the journey in Bihar will be full-fledged because... It will be literally the same for every company. So we do not have to start testing the waters in Bihar and go in phases. So Globus will enter lock, stock, and barrel in Bihar the moment Bihar opens. We definitely see an inherent advantage for any organization that has a base layer of manufacturing. We definitely have, and we see that as a structural advantage for us in the short-medium term for sure, and probably On this strength, once we build our base, this advantage will be there for many years to continue.

Understood. The last quick question. Obviously, Iran crisis has impact on everything in the world. So I wanted to understand from glass bottles and say now elections done, results done, diesel price hike is just a formality in my view. How do you see your P&L getting impacted, especially the P&A, because there was an increase in losses there, 5 crores, versus the full year number, and clearly, everyone will feel the pain. We wanted to understand glass bottles and logistics for what can be the impact.

So, you are correct in saying that obviously this political development has just come as a surprise to most industries, if not all, and we are no exception. And while we were caught by surprise, we have quickly geared up, and a lot of efficiency measures are already up and about. While we see a very, very – I mean, there will be an impact, but the way we see most of the impact, we should be able to neutralize. And I'm also confident that, you know, looking at what's happening is the governments will eventually concede into a price increase because many operators will struggle under these circumstances. Luckily, we have activated very promptly on all efficiency measures, whether it is on packaging material, raw material, freight costs. We have a full-fledged project going on for that, and we are tracking it. So we should come out with much more modest.

I just wanted to add to what Param said. One mitigating factor to higher raw material costs this year is going to be lower tariff on scotch. So that's a mitigating factor. It doesn't offset the entire amount. So overall, there will be an impact, but not very considerable.

Scores benefit from Q3, or you expect maybe Q2 also some benefit can come?

Let's see how it finally plays out, Avnish, in terms of the timing of invent fees that are in the pipeline and so on. But this year, of course, we will start getting that benefit.

Sure. Thanks for all this. That's all for my day. Thank you. Thank you, Avnish.

Our next question comes from the line of Bhargav Bhuddhadev from Ambit Asset Management. Please go ahead.

Yes, good afternoon, sir, and thank you very much for giving clarity on the fundraise part. So, just to extend that question, so is it possible to quantify what is the funding requirement now to expand the IMFL portfolio? I mean, as we build our vision for FY29, we're looking to sort of reach to about closer to 500 odd crores. How much money do we need and is the internal cash flow good enough for post-the-date restructuring to fund that plan?

Hi, Bhargav. Thanks for the question. So, you know, many of these things are a way to watch. We can say that this year, we do not see a need to achieve the business plan given some of the operational improvements and leverage we've been able to get. The added liquidity from the debt optimization that London spoke about also supported that. We're expecting... You know, margins, cash flow from manufacturing will remain stable at these levels going forward. And if that's the case, we should be able to avoid the fundraise altogether. But for now, this year, we don't see a need at all. For subsequent periods, let's, you know, let's wait and watch a little bit, see how the first two or three quarters of this year plays out in terms of, of course, our own performance, But more importantly, some of the, you know, larger political macroeconomic events. And then we'll be in a better position to comment.

Okay. And secondly, sir, is it correct to highlight that in rising crude prices, typically the oil and marketing companies would want to buy ethanol more from sugar-based companies rather than alcohol-based companies or that hypothesis?

No, we don't see that. I mean, ethanol, whether sugar or grain, the oil companies have zero preference or any of that. The other factor to consider is that sugar has the limits to the amount of capacity it can shift to ethanol. There's also the need to produce sugar, right? There is a very significant grain ethanol capacity base in the country. Over the last few months, We've seen oil marketing companies, Government of India, start preparing towards higher ethanol blends, and I believe flex fuel mandates for new cars is also on the anvil. So, you know, overall ethanol demands are going to be quite strong going forward. And, you know, I guess it has been expedited due to higher crude prices.

Great, sir. Thank you very much for the answers and all the very best. Thank you.

Thank you so much. Our next question comes from the line of Himanshu Shah from Dalat Capital. Please go ahead.

Thanks. Thanks a lot for the opportunity. So just a couple of questions. First is on the manufacturing business. We have shifted on the eastern side of our plants from ethanol to ENA, which has resulted into lower volumes. Is that what you clarified?

So, there are a few different aspects that have gone into play here. One is that when we shift from rice to maize, there is a small capacity derating that takes place in each plant. I explained in my opening remarks that if we are to shift all three of our eastern plants to maize, it would lead to a derating of 75 km per day. Okay? Okay. This, of course, it's not a decision taken for all three plants all at the same time. Each plant has its own decision parameters. And we optimize the model for profitability and cash flow rather than volume. So that's number one. Number two is that when we are shifting from ethanol to ENA in a sizable quantity, There is a period of inventory buildup due to an extended permissions process that is required in India from, you know, multiple state access departments, you know, multiple in the sense, the important state, the receiving state, as well as the supplying state. And thirdly, with increasing exports, there is also an increased amount of material in the pipeline. So a combination of these three factors led to a slightly lower volume in Q4. Overall, our capacity utilization was 80%, and that's well within the annual guidance that we have of 80% to 85%. The lower, or rather the volume buildup, the inventory buildup. That we've seen in Q4 will get liquidated in Q1 in addition to the capacity of Q1. So we're going to see an increase in volume in Q1 because of this pipeline cleanup that we had in Q4.

Okay, so just to simplify this, historically we have been able to sell around 19 to 20 crore litres of bulk alcohol annually, and with UP capacity coming on stream, and till the time it gets captively consumed in UP over the next couple of years, fair to assume we should be able to sell 20 to 23 crore litres. Bulkal call sales in FY27. We have those kind of visibility and ethanol orders.

A combination of ethanol and ENA, yes, not just ethanol.

Yeah, I'm saying all put together. ENA, ethanol, export sales, all put together, we should. Because our exit run rate has been much lower, 4.2 crore, which is like annually 16-17 crore. Although you have clarified that the left-out sales inventory built-ups would get sold in. Hello?

Yeah, Nilanjan, can you comment on this? What is our exit FY volume for bulk for the manufacturing business?

Exit FY volume for bulk for manufacturing business, FY26, has been 199.5 million liters.

Right, so it's, you know, it's in the 20 crores, it's nearly 20 crores, so that's the, it's in the guidance that we have. Okay, but I'm not sure what you were talking about, 16 crores, 16.4 crores, I'm not sure what that was.

Sir, I was going to accept water rate, 4 crores, 4.2 crores litres into 4.

I mean, you're right in saying that 20 crore is our annual guidance, and on top of that does UP. So, yes, there is going to be growth on top of the 20 crores.

So, can we have visibility of ethanol orders, export orders on that front?

Yes.

Okay. And secondly, sir, you mentioned that the EBITDA per litre or spread should remain in small park in the current range, which is the annual range or the H2 range?

No, no. 5 to 7 rupees is our guidance for the EBITDA per litre. That's the range in which it will remain for India. We've seen higher realizations in Q4, but my expectation is to be firmly within 5 to 7 rupees for a year.

So, the EBITDA per litre range should actually go down, is what you are indicating on a full-year basis in FY27.

We achieved that at 6.2k rupees in Q4. And that's, you know, it's within that 5 to 7 range. The strategic margin profile of the bulk business is in that 5 to 7 range. I do not see any event in FY27 where our margins will be strategically higher. So 5 to 7 is our guidance for each of the years. The FY26 was that range, and FY27, we expect the same range.

Sure. And what kind of cost increase are we looking at because of this geopolitical situation on our pet bottle and across our other cost line items from ballpark indicator? While we have taken some mitigating measures, but if you can just give what type of cost pressures are we looking at?

So, Param, do you want to talk a little bit about this?

Yeah, so, thanks, thanks, Shekhar, and hi, Himanshu. So, it's difficult to put a number out there, Himanshu, but what we have as of now is, you know, we've built multiple scenarios of the timeline, what-if scenarios. And based on that, what we have done is we have our mitigation plan already rolled out. As we are speaking, it is in full force. Based on that outcome, you know, regardless of, you know, how long this agony prolongs within this year, we see that our hit will be modest. Should this agony... You know, sort of immediately get capped. Then maybe with a good day, we may have some benefit also coming to us with all the efficiency measures we have put in. So we are fairly... You know, how should I say, uninterrupted in our pursuit of where we are going and assume that these are things that will happen every, you know, year or two years, they will be this sort of a thing. So we are not overtly concerned about this, unlike some other pairs. We are not overtly concerned about it at this stage.

And just lastly, when you're maintaining your vision 29 or guidance which has been given, it implies a very significant CAGR in terms of revenue across all the three business segments. So, we remain confident on that particular front. Now, it looks like challenging.

So, the point is well noted. See, the way we see it is, and as I have sort of shared a little bit more detail, You see, as more and more emerging markets move into the core markets, the number of core markets will eventually outweigh the emerging markets within this 2.0 business plan. And that is where the momentum will start multiplying. Because when we have X number of emerging markets and five core markets, the ratio starts being diluted. But as the five core markets become 8, 9, 10, suddenly the whole drawing board starts giving different results. And that's what we are trying to clarify, that, you know, the number of core markets as it starts increasing, the whole momentum will continue to build and accelerate for times to come. And that is why we are still confident that what we have set out, we are still on line or on track, regardless of, you know, this thing of Delhi. And, you know, who knows, in future, there could be another small spring surprise around the corner.

Sure. And just last small follow-up, Delhi has now fully normalized for us.

Almost there. As I said, the last quarter, we came up with 10% shortfall to come at par with the previous year. So it shows from 40, we came down to 10. So we are fairly confident that we are almost over the hump and the buildup of the growth should start beginning. How soon we can, you know, neutralize this and build it into an accelerated momentum is, as we go forward, we will keep sharing, you know, the Delhi performance for a couple of quarters so that, you know, all the investors also have a little bit more view into how we have traversed the journey from two points. One is, obviously, since it has been something we have spoken about, and second, also for everybody out there to sort of understand that these challenges will happen. It's the ability of the organization and the professional team how to navigate them quickly and turn them around into opportunities rather than let them keep draining the medium term. The short-term hiccups, of course, can't be prevented. So we will keep sharing, but I am very optimistic on Delhi going forward.

Sure, sir. That's very helpful. That's it from my side. All the best.

Thanks, Ivanshu. Thank you.

Thank you. Our next question comes from the line of Soumya as from Insightful Investments. Please go ahead.

Hi, sir. Thank you for the opportunity. I just had a question regarding the P&A EBITDA for Q4. And it has increased, as in the loss has increased from what was around 1.222 for the previous quarters to 5 crores this time. So could you just explain the reason for the same?

Yeah, so thanks for the question and the opportunity, Soumya. See, the way we have structured our business journey is that There are some quarters when new emerging markets are not opened up, or they are in that mode where we are still sort of in a very early seeding place, and then a time comes when emerging market needs investment. So, and that reflects in quarter to quarter. So, the yo-yo of these quarters is likely to continue for another, maybe another year and a bit. And then this starts moving into the next zone of profitability. Because in the quarter, when we have expanded and opened up East, extra investments have gone in, we have opened up Jharkhand. And hence, it is very difficult for us to... We'll track our business decisions basis to try and level out each quarter performance in P&A because that would be suboptimal. So, we are sticking to our business plan, and as and when the light moment comes, we inject our financial force onto the market, either to expand or bring new launches, or deeper, either width of distribution or depth of distribution.

So, and that obviously adds up to the light. Sorry to interrupt. I just want to give a little color. So in this quarter, for example, we had around three to three and a half quad rupees of additional labor registration costs. That were paid for new brand launches. And this was done because we felt the timing for launching these brands in Jan and Feb is more favorable than doing it as soon as the excise year changes. Now, of course, all of that has to be booked into, you know, expenses, and that drives the losses a little bit higher. But this does not, of course, show accurately the underlying health of the business, which is that, you know, what Param mentioned in his opening remarks, that four out of five states of the core markets are now profitable.

Thank you, sir. Thank you so much.

Thanks, Aumir. Thank you. Our next question comes from the line of Nitin Awasthi from Ingrid Capital. Please go ahead.

Hello, sir. First question, could we get a numerical clarity on the Delhi numbers? Like we have understood that our segmented numbers of the regular category are significantly impacted because of Delhi, and hence looking at the overall number doesn't give a true picture of the growth of the company. So if you could just quantify FY25, what was the sales? Millions cases sales in the regular segment in Delhi, and FY26 what it is. So that distinction could be clearly made.

Nitin, I accept your feedback on this. We're not prepared to give you the numbers immediately on this call, but what I can say is that year on year, UP and Rajasthan together have grown in volume by 7%.

Yeah. Okay.

So if I put those two states together, then we have seen a 7% growth, Rajasthan and UP, in the last year. Overall, our volumes are flat, so the other markets de-grew by 7%. In the overall contribution. Understood, understood. Okay, now that clarifies a lot of things. So, if you just remove the impact of Delhi, we actually have grown 7%. No, no, it's not just Delhi. It's not just Delhi. So, Param mentioned this in an opening remarks. Delhi, and this is, okay, let's separate TNA Delhi and RNO Delhi. Yeah, so I just want to clarify to Nitin as well as the others who are on the call that right now we're talking about R&O Delhi, not P&A Delhi. Okay, so R&O Delhi in the last year, we have experienced in some periods absolutely zero volumes and in some periods we've experienced in fact growth over last year. Okay, and this is a month on month variation. So, Dali... Policy for R&O brands has been in complete flux. As of the end of Q4, we decided until the policy is not stabilized, we will not operate in Delhi for R&O brands. The 7% degrowth in volumes, essentially, from overall volumes from the other markets, is a combination of Delhi, West Bengal, and Haryana. We have also pulled out our portfolio, redoing the portfolio, as well as shifting the manufacturing location. And in the near term, we will relaunch that market. So, essentially, it's UP and Rajasthan that have continued to grow 7%. Hopefully, we'll be getting to higher levels of growth from these two markets in the near future. And the other markets has been... Quite problematic, and therefore, overall volumes are flat.

A little more detail on West Bengal. See, West Bengal, we had constraints to grow, and as a result, it was a choice we made to shift our whole manufacturing license to a different location to set ourselves up, because the industry is almost about just short of 3 million cases a month there. So the whole objective was and the whole license shifting and setting up is going to take some time. So we have kept it out of the equation. And when we enter it back, we are going to enter with a full-fledged new portfolio with the same aggressive stance as we have done in UP to make it then the next powerful state, by which time we obviously would have picked up a lot of momentum in UP, as you will see in the coming quarters.

Understood, sir. Got it. So, second question on the balance sheet front. Of course, you've given a detailed presentation on how the cost constraints, how the treasury management, how the renegotiation of terms of the loans are happening. However, one clarification verbally required is that we had seen a trajectory of the interest cost per quarter continuously falling. Q4, we saw a jump. So, basically, we were at 13 crores roughly. Q4, we saw a jump to 16.5 crores. Now, was that a result of the cost of renegotiation being incurred? And if so, what should be the trajectory going forward?

No, no. Q4, the increase of 3 crores is basically, till Q3, we were capitalizing the interest cost on UP term loan. Okay, so the interest cost was less in Q3, which from Q4 has gone up by 3 crores when we had to, when after commissioning, the interest cost had to be expensed off. However, with this refinancing, again, it will plateau down to a reasonable level.

So, what is the expected interest cost? I think that's the question going forward.

Interest rate?

No, interest cost. You can do it either which way, rate-wise also or cost-wise also.

14 to 15%. 14 to 15 crores. Sorry, 14 to 15 crores.

Understood, understood, sir. Thank you. Got it.

Thank you. Thank you. Our next question comes from the line of Sunny Gosar from MK Venture. Please go ahead.

Yeah. Hi, thanks for taking my question. I just wanted to basically build on to the other participants' question on the regular and other category. So, if we take a two, three-year historical view of the performance category, we were at about 14.5 billion cases three years back. We are at now about 15. 7 million cases. It's like no single-digit growth. And I understand there have been lots of challenges with state-level challenges with Haryana, Delhi, West Bengal. Now, assuming that a lot of these have kind of been solved for and in the base, how should we look at? The next two, three years from the regular and other category, and what is that outlook on the growth in this category?

So, thanks, Rani. It is, you know, it is precisely this very sort of a scenario which prompted us to pivot into UP with a full-fledged commitment and investment. And that the overall, because Rajasthan was the growing market and a couple of other markets were yo-yoing and not showing long-term stability. So, and that is exactly the reason why we entered into UP, which is three times bigger market than Rajasthan itself. And The Delhi, obviously, as we have pointed out, we are waiting for clarity on the way forward on the policy front and the tender front. In West Bengal, our license is in process, and it's very difficult to commit a particular quarter when everything gets ticked off and signed off, but the process is robustly being changed. Haryana still happens to be a yo-yo, but UP itself is going to be the huge driver. Since we don't give volume projections, In the short term, but the very fact that Uttar Pradesh is a three times bigger industry size, almost like 95 lakh cases to a 1 crore case market per month, we are very, very confident of pulling in robust volume growth in this category, collectively.

Sorry to harp on this a little more, but you mentioned that there is still lack of clarity in terms of when we can kind of get back to West Bengal at full swing. So there would still be an impact in the base quarter, right? Like at least for the next one or two quarters, we will have West Bengal in the full swing.

It's negligible. It's now negligible going forward. It's negligible because we had initiated, when did we initiate Nilendian? I think somewhere around August, September already we started communicating, isn't it? So, it's almost negligible now because we have started softening our whole approach and sort of heading towards the zero base while we were migrating. So, I think most of it is behind us already.

Yeah, so Q1 will have some West Bengal… Very little, marginal.

Very marginal.

That will be the answer. So the rebasing is nearly complete, Sunny. And, you know, the earlier question, I gave some colors to the Rajasthan-UP combined growth in the last year. You know, I think we'll be able to grow more than that, UP-Rajasthan combined. And since the rebasing is complete or nearly complete, that should reflect. In the overall number as well, there should be some Bengal volume in Q1. I don't recall what it was. So, that's the only caveat over here.

Got it. And from a profitability standpoint, does it mean that both UP and Rajasthan as a portfolio will have better profitability? Smaller states become negligible, the overall profitability also will kind of start improving on the regular and others.

So, our profitability in the regular and others, I think Q4 was 18%. Nilanjan, please correct me if I'm wrong. Yeah, yeah, yeah. That's a little bit on the higher end of what we feel is sustainable. Uh, UP growth is not as profitable as Rajasthan volumes, uh, naturally. Um, so I don't foresee this 18% margin, uh, continuing. Um, it, it is going to be a little bit lower. I think our target in this space is 16 to 18%. Um, so, you know, it will be a little bit lower than that, um, for sure.

From an absolute margin standpoint, it should.

Oh, yes. Oh, yes. Yeah, yeah. Right, of course. On an absolute rupee term, it will be larger. Yeah. Of course, that goes without saying. Yeah, absolutely.

Yeah. One last question from my side. On the prestige and above segment, in terms of the brand portfolio that you kind of built up now, in terms of what the whiskey and vodka that we have, so is... So, what is our thought process on the brand build-out, or will we kind of try and go deeper on the current portfolio of brands, at least for a while, and then look to add more brands? So, what is the thought process on the growth?

So we see at this point of time, obviously, if we keep Luxury still as a bucket, and Luxury at this point of time has Duaab and Terai families, and we see ourselves making a lot of effort at strengthening them at this point of time. On the mainstream, P&A, Mountain Oak, including its family, Brothers and Company, including its family, Snofsky, including its family, and also, you know, these are the ones which are going to be core drivers as we are driving these families. There will be variants, and time to time, there will be strategic fits, but in terms of. Real contributors to top line and bottom line, all these three families will continue to be significant drivers for us. And we are building around these families. Mountain Oak has now varietal of a lemony. Along with it, Snowsky has quite a few flavors, and there are some more works which we will all see in the future. Similarly, Brothers has V15. So these brands are being built, and we see these three as main drivers in the short-medium term, these three families.

Got it, got it. This is very helpful, and thanks for the detailed answers to my question.

Yeah, the whole intent here is funny that we started with being a one-brand show, which was Mountain Oak, and like the whole experience of Delhi as a state, we realized that eventually when we are a many-market P&A segment, we also will be a many-good-brand P&A segment, So that we are not dependent on any short-term vagaries of the environment of business. So, that's where we are building these portfolios.

Thank you so much.

Thank you.

Thank you. Our next question comes from the line of Rommel from Electrum PMS. Please go ahead.

Hello. Yeah, thanks for the opportunity, sir. And it's heartening to know that I think this year you unlocked a good amount of free cash flows and probably might not need external funding. And I hope, you know, you do better in the coming years. Just a couple of things on. So first is just needed some breakup of, you know, manufacturing. So how much was ethanol? How much was ENA? And how much was captive? Probably if you can give some data points around this.

So, after around 20 crores, uh, liters of sale of, uh, in the manufacturing space, there is zero, um, captive within this captive is on top. Okay. Okay. Uh, and within 20 crores, um, uh, I, uh, Nilanjan, again, just feel free to come in. Uh, we're at about 70, 30, 70 ethanol, 30 ENA.

Yeah, it's almost there, 72-28.

Okay, got it. And I think there was, we also mentioned that there was some issue on the pricing front on the ENA side. So if you can just throw some light on what was it?

No, it's not an issue. It's just the way the markets are structured. E&E prices are a little bit lower than that of ethanol. And the quarter, this quarter gone by before, the same quarter previous year had a much higher ethanol share. So as we shifted to E&E, that revenue was a little bit lower. In addition, we had an inventory buildup, which also impacted revenue. So, it's not an issue per se. It's just, you know, those markets are strategically different. What's essential for us is monitoring our profit per meter. And, you know, we've been over-delivered on our guidance for this quarter. But going forward, our guidance remains between 5 and 7 rupees a meter, regardless of ENA or ethanol.

Okay, and so this year, did we export ethanol? I think you mentioned about 3 crores.

We started in Q4, 3.7 million liters.

Okay, 3.7 million liters. We started in Q4. So, going ahead, you know, this number can keep on increasing and whether this is like in terms of profitability, is export similar to what we are doing for the bulk sales in terms of profitability overall?

You know, it changes month on month. So, I don't want to, it's not strategically more profitable or less profitable. I think overall the basket will give us this 5 to 7 rupees.

Okay, okay, got it. It becomes an additional volume driver. I think that's really the point here. Yeah, yeah, correct. So I was just coming to the volume side. So with exports now also coming in, and UP also coming in, how do you see the overall bulk, you know, volume growth going high?

So, 20 crores is what the other units will give us aside from UP, and UP should give us about somewhere around 2 crores meters. We're seeing sort of a volume, projecting volume growth in UP. So, some part of that capacity might get consumed internally. So, you know, well over 20 crores will be the target for this year.

Okay. And on this, you know, just on the premium segment, so the realization per case, you know, what we can just calculate, how do you see that moving, you know, going ahead? So apart from the volume growth, which is obviously coming in very well, how do you see this shift?

So, you know, again, that answer, of course, this is Param's domain, and Param, please come in after I'm done. But that answer really has to be thought through in this way that Param sort of spoke about earlier in his opening remarks. Which is that we have these four markets and emerging markets. So, you know, in the core markets, that number is a little more easily, we can easily project that number a lot easier than we can for emerging markets. Because, you know, we don't have, we launch a portfolio, sometimes a certain set of brands do better than the others. And, you know, those brands may have higher price or a lower price. So strategically, as the luxury portfolio starts coming in into all the markets on top of the prestige and above, or rather the core segments of Mountain, Snosky, and Brothers, the NSVs are going to go up. But on a quarter-by-quarter basis, they may well be blitz, and those don't really affect the strategic nature of the business.

What we can do is that, you know, like we keep calling out that at this point of time, four out of five core markets are profitable. Even when the emerging markets start becoming core markets, we will keep on sharing that information so that, you know, because the whole objective is for us to increase more and more core markets at the best possible pace. And because those are the ones which give stable top and bottom line growth. So we will keep going forward also updating the investor community on that how, you know, as soon as the market moves into it, we will keep changing our numerical numbers. And when the fourth becomes fifth, we will call it out that now we have so many markets. We'll keep updating that part at least, surely.

Okay, okay. And lastly, on the UP side, if you can just give some number on the monthly volumes, and as a suggestion, because UP is now getting bigger and bigger of the overall pie, would you call out separate numbers going ahead on this?

Currently, we are not calling out separate numbers for UP. We'll have a think internally on how to do that to protect our competitor information as well. And if we feel that the information is not going to weaken our position in UP, then perhaps we can start putting it out. Our primary objective is to secure a strategic sort of expansion in the state or in various states that we're in, whilst being as transparent with investors as possible.

Okay. Thanks a lot, and all the best.

Thank you. Our next question comes from the line of Hitendra Pradhan from Maximal Capital. Please go ahead.

Yeah, hi, sir. So, sir, first question on the PNA side. So, given, since you alluded that we are still going by FY29. So, your voice was a bit, your voice broke. Is it better? Is it better now? Yeah, yeah, yeah, yeah. Clear. Yeah, yeah. So, on the PNA side, sir, you know, this. Last year, we have seen a sort of a steep deceleration in the growth rate. And even excluding Delhi, you called out a number of 58%. Now, given your FY29 sort of a vision of 1,000 crore plus in this segment, you know, we need to almost double our revenues every year for the next three years.

So, uh... So, the number is not 1,000 crores for P&A, Hitendra.

The number for P&A is 500 crores, not 1,000 crores.

500 crores is what we had called out, yeah. So, yeah, that's the number we are holding on to, not 1,000 crores.

Okay. I don't think we've ever given that guidance of thousands of this. Okay, my bad. But given that sort of a vision also, I think we need to grow 3x in 3 years. So that is even now like 40 odd percent growth and our growth rate has decelerated. So what, I mean, is it looking achievable given where we stand?

Yes, I think even after Delhi, last year we grew 40%, grew our volumes 40%. There was nearly 3% price mixed base change, and that's why the revenue doesn't reflect it. I don't see any concern on achieving this target.

You know, yeah, I mean, see, as the base keeps on increasing, you can see the numbers multiplying if you do your own math, you will see the numbers multiplying because as we have called out, as more and more markets move from emerging to core, the buildup will start happening on a higher base. And so what looks like, it's like when we were 20 crores, suddenly 164 crores looked very difficult to us. So it's a multiplier effect that starts moving. So moving 100 crores plus a year is not something that is going to be something to be thought out as is it too tall in order. Because the base will keep on increasing with every year.

Yeah, so that was my question. As the base increases, your growth rate is decelerating. So given that, do we still feel that we will be able to achieve, let's say, 40%?

Yeah, because on a higher base, even a lesser, slightly modest growth brings us to 500. Exactly that is the reason why we are very confident. Okay.

Okay. And secondly, on the R&O market, now, given that we will be having UP this year, so what is the, so, you know, as one more participant alluded to that this has been growing in a lower single digit fashion, but at least for this FY27, FY28, you know, how are we looking at the growth?

So, you know, I mentioned this earlier as well. Rajasthan plus UP last year gave us 7% growth. I believe in the coming year, Rajasthan plus UP will give us higher than 7% growth. At this point, we are not in a position to give a more specific guidance for Rajasthan plus UP for this year. But, you know, this is the grand launches we've had that Param spoke about earlier. The markets are looking quite exciting.

And UP specifically, sir, let's say in the last month, let's say April, you know, what kind of monthly run rate have we achieved here in terms of cases?

So, you know, let's just wait a little bit for the momentum to settle down. In April is a new exercise year. There is a, in this year, there was a change in the route to market. So we saw inventory buildup taking place in April. We also saw new brand launches. So I don't want to talk about the April number at this point. Suffice it to say, we're going to exceed our Rajasthan plus UPFY26 growth number, and you'll start seeing the performance in Q1 and onwards.

Okay. Rajasthan, last year, sir, we had got a, you know, 4-5% price increase also. So, that also held our revenues in FY26. For this year, have we got any price increase in Rajasthan, Haryana, or any of the major markets?

Nilanjan, can you just confirm that?

Yeah, this year also, we've got a price increase in Rajasthan to the extent of Rs.30 a case. So, that has been replicated for this year also. UP, as of now, no. Haryana, no. But Rajasthan, you've got a price increase.

Yeah, but we've got to be a little cautious of that price increase because there's been inflation in PPP prices. So, and in addition, UP growth is going to be at a lower margin than Rajasthan. We closed Q4 with 18%, which is a little bit higher than the sustainable margin profile. Our guidance is around the 16%, 17% kind of mark. So, we do see margins coming down a bit, but the overall pool is going to be much larger in terms of rupees as the business grows in the coming years.

Okay. And on the manufacturing segment, so what is our maintenance capex now that we won't be growing any further beyond UP? What is our maintenance capex per year?

Maintenance capex is around 40 to 50 crores. However, we also have additional capex in terms of increasing our malt whiskey inventory capacity, so for aging malt whiskey, as well as growing our bottling infrastructure. To keep up with the demands of the consumer business. So, overall, I foresee somewhere between 60 to 80 crores of capex sustaining for a few years.

So, 40 to 50 is that maintenance?

Yeah, 40 to 50 is maintenance plus another 20 to 30 to grow whiskey as well as bottling infrastructure, whiskey aging and bottling infrastructure.

So, sir, given that plan, so that means that this year onwards we'll start paying down our debt aggressively, given the kind of cash flow we are earning. So maybe next one or two years we can go to zero debt.

I won't comment on zero debt, but yes, what I mentioned earlier on the call as well, that given the cash flows that we have, the plan for capital raise, equity capital raise has been put on hold. We are able to manage our expansion based on our internal cash flow. Debt will be the residual cash that is in the year after providing for working capital for our IMFL business. The residual cash will obviously go to paying down debt.

Okay. Okay. Thank you, sir. All the best. Thank you.

Thank you. Our next question comes from the line of Devam from ITECO. Please go ahead.

Yeah, thank you, sir, for the opportunity for the question. Really appreciate the striking down of the QIP since it's managed from debt and internal accruals, combination of the both. So my question was more regarding that, let's say we are doing multiple businesses, ethanol, ENA, RNO, PNA, luxury. And there are different narratives, drivers, asset turns, different margins, different gross margins, return ratios involved in each of them. Now, in the last three years, we have been trying, and there were probably some headwinds for some of those verticals. We have seen some releases. The numbers are struggling because of one-offs in one of the divisions or whatever that is happening. As an investor, I would love to understand that what is our commitment and thought process to sort of deliver a respectable ROE at an aggregate basis in the coming two to three years period, and what is the timeline, what is the accountability on that front.

So, you know, we have in the past published FY29 guidance for revenues as well as profitability. And, you know, whereas in the process of rolling out, That plan process of growing our footprint in a state-by-state fashion and a brand-by-brand fashion, there are going to be blips in a quarterly manner, but we remain committed to our FY29 volume as well as profitability guidance.

And sir, any reason why the margins in our manufacturing business have consistently, especially the ethanol piece, have been a tad lower than competition in the past few quarters?

For us, we believe that the basket of ENA plus ethanol and a capacity utilization of 80% to 85% will give us 5 to 7 rupees of EBITDA. We operate a scaled business. Which includes integration in bottling, as well as, as I said, EMA, ethanol, multi-markets, whether it's within the state, outside the state, as well as outside India. At that capacity utilization, At the scale we are, we believe that the margins are around five to seven rupees per liter. Each company has their own situation. Some people are more concentrated in a particular region. So if you did do a deep dive into one of our factories, you might find that margins are a little bit higher. So given the spread we have, the scale we have, We believe 5 to 7 is what is our number.

And then, because of the fact that probably ENA or bulk alcohol is the raw material for all the divisions, there is no risk of any cross-subsidization of margins interdivision, right?

No, we have a policy on that. We maintain transfer prices of E&A between divisions after factoring in a 5 rupee margin for the manufacturing business. So that's within the zone. However, the bulk sale number that I'm reporting to you does not include, the volume does not include the manufacturing volume.

Thank you. We'll get to you all, thanks. Thank you. Our next question comes from the line of Ikea Mania from ANS World. Please go ahead. Participant has left the queue. We'll move forward to the next participant.

Our next question comes from the line of Nishan Bhatt from Equity Works Limited. Please go ahead.

Yeah, good afternoon, Shaffer. Can you just explain the manufacturing segment once more? Because you mentioned that there was a strategic shift which led to the one-time inventory builder. So, did this, the blitz which has been caused in the volumes, will it be recovered in the next quarter, in the Q1?

Yes, it will be. So this is due to a longer supply cycle that exists in ENA, both for within India's sale and for outside India's sale. Because of a larger, you know, paperwork requirement, because E&E can be converted to alcohol, states want to protect their revenue, and therefore need far more accountability on the movement of alcohol. So that increases the supply need time as compared to ethanol, which doesn't have that requirement of paperwork. Because of the substantial shift in the east, especially in Bihar and Jharkhand, we saw a buildup in winter, and that should get normalized or reduced in Q1.

Got it. And regarding this one question was regarding the Rajasthan policy, which was a recent announcement, right? I think you declared that there is a 50% decrease in the bottling fee, which will happen.

Yeah, that's for export. So that is the material. So the material was produced in Rajasthan, and that is sold outside of Rajasthan. We will have a nominal increase in profit or other reduction in cost. Um, uh, on that, uh, portion. So that impacts our PNA business. Uh, but frankly, it's a nominal amount, which, which is, you know, part of the business plan now going forward.

Got it. Got it. That's about it from my side. Thank you.

Thank you. Our next question comes from the line of Ashish from Leo Capital. Please go ahead.

Hi, thank you for taking my question. I wanted to know what's the net debt levels as of now and what are the working capital needs in the RNO as well as the IMFL business and how many days of working capital does it need?

Melanjan, can you take that, please?

So the net debt business for the company is at 627 crores. That's the net debt. And the working capital days for RNO is five to six days.

That's exit Q4, right? So, for RNO, that number will go up slightly in Q1 and onwards.

Okay. Okay. Okay. Got it. Thank you.

Thank you. Our next question comes from the line of Aditya Patel from State Street. Please go ahead. Ajit, I'm sorry, but your voice is very low.

Is this better? Am I audible now?

Management can I please start?

Hello. I just say, if you are using any device, then you can't speak, because still we can't hear you. Participant left the queue. My next question comes from the line of Manoj, an individual investor.

Yeah, thank you very much for giving me the opportunity. My question is, just as I was going through your investor's presentation, that you have a plan by 0.29 to go in another eighth state. So, what will be your strategy for going to the other geography? So, is it by acquisition or our existing manufacturing unit will be able to handle on this? New territory. That's not a question.

Okay, so the expansion, see, even in one of the, let me just step back, even in the current market of, for example, Assam, we are going with third-party manufacturing, so every state that we expand will not have a captive Globus manufacturing unit servicing it. It depends on the efficiency. If we find that our unit servicing is more efficient, we will choose our unit, obviously, as a base unit to service that state, whether in state or the neighboring state. Alternately, we will choose the best possible business partner who will manufacture on our behalf. When we said the 8 stage, that is the minimum number where we definitely are ensuring the expansion will happen. And as we keep moving forward, you know, there is no reason to say that number can't go up. But that is what we have baked in and misaged in our guidance when we came up with the F-29 business plan. Yeah. And we stand committed to that.

Okay, sir. Thank you very much for explaining. And another question is... Means, what is the realization per cases, whatever, that is, this is a premium product, which is the Doab and Terai family.

This is nowhere it is mentioned, so, just I wanted to know.

How much is that, means, realization per cases, in your system?

We, we do not release that, isn't it? No, we don't release it. We don't release it. You know, we will have to do an internal huddle because, you know, as of now, we are not releasing the realization by category. Yeah, we have obviously in our paper called out our gross margin, and we have in the... A business plan called out that our gross margins will be in the range of, if I'm just recalling correctly, in the range of about 47% in London.

Yeah, and also if you refer to our last investor date, you'll get a fair idea of our MRP equivalent to Mumbai pricing that will give you an MRP.

Yeah, so we don't release realization per case on an ongoing basis. So, is there any harm for... Some food for us to think about. Let us see if there is anything that sort of comes as a concern to us. Let's take your question away and mull through it. We'll make a note of it.

I'm sorry, my line got disconnected. I think it makes sense to show the core markets NSV and keep emerging markets out because emerging markets can impact the numbers considerably.

No, the net realization for case, the conversation was around net realization, and I've taken it on board. So, Manoj was asking, is there any harm in sharing that information? I said, no, it's something we will just do internal, think around it and try and weigh the decision and then we'll come back on it. But we have taken your thought and input on board.

Okay, sir. Thank you very much. That's all for me.

Thank you. Thank you. Thank you.

Thank you.

Our next question comes from the line of Chandrasekhar Siddharth from Fidelity International. Please go ahead.

Hi, good afternoon. I have three questions. One for Nirajan, sorry, if you could just remind me again on the mathematics of how are you going to save on interest cost because it just seems that we're going to go down, it's going to be 14-15 crores of water. So where does it free up? Um, sort of the money to invest, uh, in the, uh, business. That's, uh, the first question. Um, second question for Shekhar, uh, you did mention about the profitability of the bulk segment, but, and, but you did say that most structurally, I think the long term is five to seven. So you, you do say there is a possibility, I mean, just in the near term that we, we can still overshoot that number, but just from a prudent assumption, the way you think about it, it's more of five to seven, uh, over the long run. And maybe just one question for Param. Did I hear you right that you said that sort of IMFL profitability is now pushed to F27?

Thank you. No, no, no. So, the way we said it was that we had called out Chandrasekhar was that in the third complete year of operation, Our endeavor is to make each individual state profitable. After completing three full years, we have called out that out of five states, four are profitable and one is still a work in progress, purely from the fairness of where we set out from. Then there was another question which revolved around that while our cumulative losses in the first three quarters were in the range of about 4.5 crores, which means 1.5 crores per quarter, Q4 suddenly came at 5 crores. What does it do? Contextually answering that, I said these investments are basis the requirement of our growth path at that point of time. We may choose to overinvest in an emerging market. We may choose to spread geography. We may choose to add a market. And then Shekhar had also given an addendum to it that in this particular case, there was a 3 crore additional investment made because over the years, we have realized that it is better to enter new brands a little before the exercise year begins rather than delay or drag if they are up and ready. So in that context, we had answered. We had not said in any way that the profitability is pushed forward or backward. It was the concern that are the losses going to be $5 per quarter by one of the investor family persons on the call. I don't remember the name. It was in that context the conversation happened. Does that clarify?

Sure. So your question regarding margins, in fact, I can take up both regarding liquidity and margins. So margins, you know, you've understood correctly, we've oversharked the guidance. Strategically, we should be within the guidance. What we do see is typically end of Q1 into Q2, and this is an annual sort of feature, with monsoons across the country, raw material, fuel prices. There is just a general bit of inflation in agri commodities. And then again, going into end of Q3 and Q4, we see raw material prices come down. So, you know, Chand Shekhar, it's five to seven is the guidance. You know, we will have periods of a little bit higher and a little bit lower. And, you know, the year we have closed at 6.3. So I see that we will continue to be within that 5 to 7 range. Q4, 8.3 doesn't mean that Q1 also will be 8.3. It is a bit of a seasonal business with regard to agri commodity purchase. With regard to liquidity, the debt optimization had two parts. I think the first thing that we were after was reducing cash flow debt repayment burden so that it frees up liquidity. And the other thing that we went after was interest rates. The team did a fantastic job on this, and I think we've saved a total of 50 crores in London, is that right? 50 crores for FY27?

50 crores, yes.

I'm sorry, so you're essentially saying you're refied it and sort of the principles, you're pushed it back a little further, sort of the principle payment. Is that what you're essentially saying? Yes. Yeah, that saves up the, okay, okay, so the debt requirement obligations go down this year.

Also, to add to what Shaker says, that we have also renegotiated our interest rates. Our interest rates should effectively come down by 2.5 to 3 crores, which effectively means that our debt levels will also come down on borrowings by another 30 to 35 crores.

Understood. Thank you.

Yeah, be that as it may, UP has been capitalized. So, interest will go back to around 14-15 crores per quarter.

Yeah, yeah, yeah. Thank you. Thank you so much. Ladies and gentlemen, due to the time constraint, that was the last question for today. I now hand the contents over to Mr. Sheikha Sourou for closing. Thank you and over to you soon.

Thank you, everyone, for joining us today, and if there are any unanswered questions, please do reach out to us, and we will get back to you as soon as possible. Thank you again. Have a great day and a good weekend. Bye.

Thank you so much. On behalf of Global Space Limited, that concludes this conference. Thank you for joining us, and you may now disconnect your lines.