LMW Limited (LMW) Q1 2027 Earnings Call Transcript

Moderator Good day and Welcome To the earnings call of LMW Limited for Q1 of FY 26-27 hosted by NSDL. As a reminder, please know that the participants lines will be in listen only mode and there will be an opportunity to ask questions after the brief by the company officials. Should you require any assistance during the conference call and raise questions, please signal the operator by raising your hands. Please note that this call is being recorded and this is Sameer from NSDL. We have with us Mr. V Senthil, Chief Financial Officer and Ma' am B. Dhanalakshmi, Associate Vice President of the company and now over to you sir. Mr. V. Senthil (CFO) Thank you. Thank you, Mr. Samir. Very good afternoon to everyone and thank you for joining the LMW Earnings call for Q1 of FY 26-27. We will have a brief about the Overall performance of the company for the Period ending June 26 followed by an interactive session. I would also like to clarify that certain statements made in the discussion during the call will be forward looking in nature. To begin with let me explain the Overall performance of the company then we will go into segment wise and consolidated performance. The financial results have been posted on the company website and I hope you had an opportunity to go through the same. The revenue for the period ended June 26 is at 891 crores as against 889 crores for March 26 which is almost flat, when compared to June 25 quarter end it was 722 crores, that's an increase of 24%. The PBT for the period stands at 85 crores as against 72 crores for the previous quarter with an increase of 18% and when compared to the quarter ended June 25 where it was 34 crores, that's an increase of around 151%. Going to division wise detail, TMD revenue stands at 482 crores for the current quarter as against 485 for the previous quarter and revenue for the quarter end of June 25 was 415 crores which is up by 16% compared to the current quarter. With respect to the order book, currently we hold an order book of 3200 crores for TMD of which the active orders are around 2,400 crores. With respect to sales which has been clocked during the current quarter, the ratio of domestic to export to spares, the ratio stands at 64%, 10% exports and 26% spares. With respect To LMW Global, the turnover for the quarter stands at 51 crores as against a comparative number of 54 crores for the previous quarter. For the current quarter the loss stands at 5.6 crores as against the loss of 5 crores for the previous quarter and the order book stands at 22 crores.

In LMW China for the quarter the turnover is 11 crores and comparative period last year it stood at 76 crores and the loss during the current quarter is 7 crores as against a loss of 11.5 crores during the previous quarter, the order book on hand in China stands at 128 crores. Now I move to Machine Tool Division and Foundry. The revenue in Machine Tool Division and foundry stands at 434 crores for the current quarter as against, I'm sorry, Sorry, It is 343 crores for the current quarter as against 352 crores for the previous quarter, and it was 251 crores for the quarter ended June 25. Out of this around 8% relates to foundry Division. The balance is towards Machine Tool Division. With respect to ATC, the revenue for the current quarter stands at 60 crores as against 57 crores for the previous quarter and for the quarter ended June 25 it was 46 crores. At a consolidated level, the revenue stands at 902 crores for the current quarter as against 972 crores during the previous quarter and the profit is at rupees 75 crores as against rupees 78 crores during the previous quarter. With this brief, I would like to continue to the interactive session. Over to you, Mr. Sameer. Moderator Sir, thank you so much for Addressing the people we have with us. Ladies and gentlemen, it is time we go ahead with the interactive session. We would request the people in the attendees who have any questions to please raise their hands so that we can take you forward. I would like to request people to please use the raise hands feature so that you can be unmuted and your video can be turned on. And then we can proceed with your questions. So, we have with us Mr. Divyam Doshi. Divyam ji, thank you so much for joining us. You have already been unmuted. We would also request you to please turn on your video if possible. Else we can use the audio feature and go ahead with the question. Sir, Mr. V. Senthil (CFO) You are on mute. Mr. Divyam, can you please unmute? Yeah, I'm audible now. Mr. Divyam Doshi Yeah, I'm audible now Mr. V. Senthil (CFO) Yes, yes. Please go Ahead Mr. Divyam Doshi So, congratulations on the good set of numbers. I just wanted to ask that since we are expanding into six new divisions. What actually triggered this plan of expanding into six different divisions? Mr. V. Senthil (CFO) Any other questions?

Mr. Divyam Doshi Yeah, I also have one follow up. Not a follow up question, but yeah. So, pharma and specialty chemical is not. Is a very different part that we don't match with in any sense. So how does. How did the board come up with thinking of launching into the pharma and specialty thing? Mr. V. Senthil (CFO) Any other questions Mr. Divyam on the current? Mr. Divyam Joshi (Speaker) No Sir. Mr. V. Senthil (CFO) Okay, I think yes, this is an enabling resolution. The idea is to, and it is not just pharma chemical. You'll have EV there; you have got advanced technology center there. The idea is that we are looking at various options which are available and this is an enablement resolution. Anything which is significant which needs to be informed, we’ll bring it too, it will get published and it will get informed to the shareholders. But as of now, it's an enabling resolution where we're looking at multiple options. Mr. Divyam Joshi (Speaker) Okay, thank you so much sir. Mr. V. Senthil (CFO) Thank you. Back to you, Mr. Sameer. Moderator So, thank you so much. This was Mr. Divyam with the questions going ahead. We would request more people to please raise your hands if at all you have any questions so that we can take you forward. Now amongst the attendees, we have no hands raised. Hence we would request people to please raise your hands if at all you have any questions. Okay, now we do have next person who has his hand raised is Mr. Lakshmi Narayanan. Mr. Lakshmi Narayanan (Speaker) Yeah, thank you so much. Sir. I just want to understand, you know, how you are thinking about your order book in terms of the domestic market, particularly in the, you know, in the textile division. And uh, you know, what are the positives you are seeing given the fact that there has been a lot of noise around, you know, this tariff fluctuations, etc. And how secured is our order book? What kind of, you know, I think year back we were fully booked. I just want to understand that point of view, you know, what kind of visibility we have both industry and our own order book in the domestic for textiles. Mr. V. Senthil (CFO) Any other questions? Mr. Lakshmi Narayanan As of now, only one question, sir.

Mr. V. Senthil (CFO) Okay, thank you. So, thanks for the question. Like I mentioned, the order book. Is at 3,200 add crores. This is from my side secured order book. Yes, it's a secured order book because what we take into order book is only where we have 10% deposit and so that order book is secured. It was almost two years back, we were running full of the delivery of closer to 14, 15 months plus. Today the situation is not like that. At least in the last two years the deliveries have come quite shrunk. But at the same time the posters of this are that if you look at there are a lot of state policies which have come. Gujarat, Orissa and I think Madhya Pradesh. There's a specific region, Dhar region, I think, I think that is these are the policies which are kind of triggering a lot of activity within the order book. And, for new order book. So specifically, in Gujarat there's a new policy, state policy which has come which includes spinning also as part of the policy for subsidies. So, these are the triggers which are helping in the outlook. And the fact that over the last two years there has been a slowdown in the overall offtake. However, we did see steep order inflow in last quarter. And we also see that all these other activities which are going on, we see that there will be further orders which will get booked for delivery. Because consistently our experience is that you can't have low installation of spindles or multiple years. The demand will come back; It is only that how quickly it comes back is the question. 3 Years back there was a very sharp uptick. This year we are not seeing a very sharp uptick, but we are very positive that there will be a gradual increase in absorption of spindles as well. Plus, like I said, the state policy plus the FTAs. So, the fact that FTA is going to fall in place in certain cases has started. Those benefits will all result in back process having a strong demand on thespinning. And I should also add that this is the domestic context. But it is also important to understand that even yarn which is spun here is exported significantly. Right? So, the fact that other countries today are having the same challenges as what we have with energy, cost of energy, etc., but perhaps we can handle it little bit better. I think that is also another reason. Where we feel that over a period the modernization and the new projects will again kick start and investments will happen. With respect to margins there, the cotton spinning margins are good now. The margins on synthetics are under a bit of strain, but they are still making money, and they would have to modernize either which phase, or it would be very difficult for them to be cost competitive and cost efficient. So, this would happen. So that is where we see the positives going forward. The FTAs, the state policies, all contributing to this. Thank you. Moderator Thank you so much. Going ahead, the next person who we have with us is Mr. Ritwik Sheth. Ritwik ji, thank you so much for joining us. It's time we got ahead with your questions please. Mr. Ritwik Sheth Yeah. Hi, good evening. Am I audible? Moderator Sir we can hear you but the voice is a little faint sir. Mr. Ritwik Sheth Is it better?

Moderator A little better, yes sir. Mr. Ritwik Sheth Yeah Hi. So, couple of questions on the machine tool division. Firstly sir, you, the USD and the euro has appreciated against the rupee in the last year or so significantly so, so that would have impacted our cost. Mr. V. Senthil (CFO) Mr. Ritwik, I, I did hear that euro and dollar appreciated but it is very, very mild. Can you please Mr. Ritwik Sheth let me rejoin from another device? Moderator Okay, Ritwik sir, we could hear you at some point and we lost you again. I think if he joins from another device, I think that should solve the problem for now. We have Mr. Lakshmi Narayanan again with a follow up question. Yes sir. Mr. Lakshmi Narayanan Yeah, on the domestic again. Right. See what I understand is that there has been excess spindleage and you know, there have been some defunct spindles and people are not utilizing full. And that's what I hear. And therefore, there is a concentration of, you know, companies with more than 1 lakh spindles. Apparently, there are only handful of, maybe not more than 20 companies would have more than 100, you know, 1 lakh spindles at, at one point in time. At, in aggregate. So this 3600-order book, can you just tell me what kind of how many companies are actually taking this and whether it is, it is going towards companies which have more than 1 lakh spindle or this is happening for modernization where they are actually replacing the old with new. Can you just give some color on that? Because we see that interest rates will be going up shortly and therefore it will actually put pressure on companies where they cannot really get a lot of tax advantage. So I just want to hear your thoughts as to, you know, whether you know, how sustainable is this and what kind of customers are actually putting these orders and these customers are putting it for modernization or green field. Some color would be helpful. Thank you. Mr. V. Senthil (CFO) Okay, first of all we prefer to take all questions at one shot and then answer one after another. Do you have any other questions? Mr. Lakshmi Narayanan No sir, this is essentially a standalone question because you mentioned that I wanted to ask just based on your, your answer. But anyway, nevertheless I, I appreciate your point and I will. This is my only question, sir.

Mr. V. Senthil (CFO) Okay. See the way we look at the order book as multiple cuts, right? One is you got projects; one is unitary project. When we Call it, we call it. It's A to Z all machinery right. From the bale opening machine till the spinning machine. The second thing are unitary machines. Unitary machines and which basically are both modernization projects which means that it happens over a period of time. I mean it takes, they start with one set of machines and they would over a period of a year, two years would modernize all the machines. Then you will have cases of unitary machines where they are only upgrading a machine for better productivity, better automation, etcetera. That is the way we look at the order book. And of course, within this you've got cotton synthetic projects cotton which both types of projects which come into play in general in a good year where there's a uptake a lot of spindles getting added. Generally you will find 60% would go. Towards projects 40% would go towards unitary machines or non-projects machines. But as far as in a year like what we have seen over the last couple of years the case would be less of projects because this is a heavy capex heavy industry. When outlook is not very positive generally going in for a full capex full new project adding up capacity is not a decision which is easily taken unless it's integrated back-to-back units. We generally don't give out information on who are the customers what is the spec of the order book in terms of large customer or small customer. Because for us you will have to, from a Indian domestic standpoint, the spinning is spread across the region and there are a lot of conversion. Conversion also happens. It is not that it is purely down to large players doing the end product. Right? There is a supply chain available for this ecosystem. The people who are converters in large integrated mills. Today if you look at the last TUF scheme which was introduced it was applicable only for integrated players. Today if you look at PLA it is only applicable for large integrated players. Spinning is part of it but applicable only for large integrated players. The way government is looking at it. Is to kind of build large customers large players. Because when competing at scale you need this kind of companies to which compete. At scale with the likes of China. Right? So that is the reason these schemes. Are all towards that. But having said that there is value in the entire segment. So, you will find a value for. A person who is doing end to end up. You love spinning till garmenting and you have players who are predominantly only in spinning and you also have players who are only doing conversion. There's a plethora of. I mean these variances you would find within the. Within our order book. I hope that answers the question. We do not go ahead. We do not give you details. I mean it's not practical to look at its saying that this people are. Only converting these people. It's not the way to look at and spinning order. Mr. Lakshmi Narayanan Thank you. Mr. V. Senthil (CFO) Thank you.

Moderator Sir. Thank you so much for answering that one. Going ahead, our next person who we have with us is Mr. Krish Mehta. Mr. Krish Mehta Hi Mr. Senthil, thank you for taking my question. This is Krish. I wanted to just get a few data points updated if possible. The first is on the ATC division. If you could provide the split between composites and metallics as well as domestic versus export. The second is on the order book. What is the export order book versus the domestic order book. And the last question is on the TMD revision if you could provide the current capacity utilization and on the previous question which you mentioned on projects versus unitary what is that current mix that you're seeing, you know this quarter or for the year? If you could provide any clarity on that if possible. Thank you. Mr. V. Senthil (CFO) I'll take the ATC first. To the split it is still 90-10. That is 90% export and what do you call ten 10% domestic composite metallics. It is around just one second. Yeah, 20% within this turnover 20% is composite and 80% is Metallics portion of it. Any other questions on ITC? With respect to mission tool division the capacity utilization will be in the region of 75 to 80%. We can still push out more machines. There will be capex which will be required for increasing it beyond which we Will be planning and we'll be investing In MTD as we go along but yes, we will be at around. 80% Capacity at the moment and capacity utilization is also dependent on the type of finishing machines we make. And as we start pushing out more VMC machining centers rather the necessity to invest more into MTD arises. Just give me a. I think you had asked the ATC order book. The order book for ATC is in the region of thousand crores of orders for execution over a period of three years, three to three and a half years. That is the order book of ATC for which is tied up for execution fully. Only thing you know you may have A little bit push and pull of These order books within this within a Quarter or within a couple of quarters. But that is for execution between project and unitary machines. For the previous question of Mr. Lakshmi Narayan, the order book would still have close to 70% of projects and 30% of unitary missions Within the order book what we mentioned. Moderator Thank you so much sir Mr. Krish had his hand raised but. Mr. Krish Mehta No. Sorry Mr. Senthil. I just wanted to follow up on that. Just to clarify my question. On the capacity utilization is also for the textile machine division So if you could just give the capacity utilization of the TMD division and on the order book it was more for the overall company of the total order book. What is export versus domestic? Not for just any division particularly. Mr. V. Senthil (CFO) Oh, the export order books are not very strong. We don't have long term export order book. Right. So, export order book is predominantly on ATC division which I said where

of the order book of thousand crores it's 90%. You'll have to put it together And I did read out where we Said around 22 plus 128 Around 150 crores of Excel machinery order book are exports. But these are all more LC based. They're all LC based. So as the orders come in, we Generally don't discuss pipeline It is only the actual LCs on hand So, we can take 900 crores in ATC as export for three years. Three and a half years. And 150 crores for immediate delivery. As far as TMD is concerned in. In its subsidiary and MTD it is all more of a very short term, short cycle order book. It's all within three months. We book, order and deliver within three months. So, we actually don't follow through on those. It is basically cash and delivery. So, when we get the money then we deliver. Mr. Krish Mehta Right? No, that's very helpful. Mr. V. Senthil (CFO) Thank you. Moderator Thank you so much sir The next person with the hand raised is Mr. Manish Goyal. we are ready for you. Can we proceed with the questions please? Mr. Manish Goyal Yeah. Hello. Can you hear me sir? Moderator Yes Sir Mr. Manish Goyal Mr. Manish Goyal Yeah. Thank you so much. Sir. On this ATC order book which has jumped to thousand crores now. So is this again with similar ratio of metallics to composite of 8020 or it's been probably composite share would have gone up. If you can clarify that. And so, for executing such large order book what are our plans on the capacity expansion? I believe you have announced a new facility with 130 crore capex. Only for the I believe land and building plus. So maybe if you can clarify what's the capex plan for ATC and what kind of capacity creation we are doing and this quarter, we have seen further improvement of margins in ATC. So, do we expect that this momentum to continue on the margins front? And one clarification on the revenue what we book in ATC this is largely the value addition only which is getting booked or now we have a product revenue booking also. And the value addition also if you can clarify that as well. Sir, on machine tool division sequentially we have seen decline in margin. So, is it attributed to rupee depreciation or is it the change in product mix? And going forward, how should we look at the growth in machine tool business going forward and, on the margins, as well. And sir, I Sorry I just also want to clarify on TMD I missed your initial

7-8 minutes remark. I joined in late. So, this exports order book you said 22, 128. So, 22 is it the Middle east and 128 is China. And also, if you can give me the revenue breakup for TMD this quarter and the order book numbers also. Sir, sorry I missed it in the earlier set. Thank you, Sir. Mr. V. Senthil (CFO) Thank you, Mr. Manish, thank you for your questions. So, I'll take the TMD first. Yes, you are right. The 22 and 128 is LMW Global in Dubai and LMW China And the revenue breakup is 64% domestic, 10% exports and 26% spares. That is the revenue breakup. The order book is basically as I always mentioned order books are generally given available for five years, right? Four years, five years depending on how we execute. Always the concern in the past was, always that when it comes to actual Execution there are a lot of push ins and pull outs and things like that which happens. But now we have stabilized our last two years as you have seen as we deliver more Exports and in fact, we have been having this export at 90% for at least the last 4 or 5 quarters. We see there is a stability in which it is getting executed, and that is where we can commit also. Yes, there is a clarity of closer to thousands of crores over the next three years of orders for three, three and a half years. I would say have orders for execution. Whilst this is there. The continuous effort is to work on it. Further order book build. Right, I mean, which again keeps giving you further revenue after. Because today we work for next three to four years. That’s what we currently work on. That's the Way it is with respect to the order versus conversion. I mean it is basically with material Without material around 70% would be without Material and around 30% would still be with material with respect to the composite It is around 20% current. From an order book Stand point, would be around 25% composite and 75% metallics. Composite again has to stabilize. I mean we have been discussing this; we have been saying this for at least 4, 5/4 again that we have to set up the facility. We have started focusing instead of domestic orders; we have started focusing on exports and only in the last three quarters are we seeing the numbers slowly build up. In fact, only in the last year, in the current year and this reflection of composite number is this. So it will reflect where it will start being. Coming then to Machine Tool Division sequentially. See, compared to Q4, Q1 is of course slightly less in terms of turnover. But I think if you were to actually look at Q1 of last year to Q1 of this year or you can compare multiple of Q ones of the previous years, I think Machine Tool Division has done extremely well thanks to two things. One is the product portfolio what we have, that is the machining centers which are there. We are seeing like we have mentioned, we are seeing definitely a growth in this Machine Tool Division. I mean, it is restricted by the number of types of product portfolios introduced in the market and it was doing quite well. And I think numbers speak for themselves with respect to the impact of the dollar. An impact of euro. Yes, there is an impact of, of this on our cost not only in Machine Tool Division, in Textile Machinery as well. I think there is a, there's an impact of this. We need to, we are working towards seeing how these costs are offset with savings. What we have a methodical way of addressing this and we Have to do that.

Thank you. Over to you, Mr. Sameer. Moderator So, thank you so much. I believe we have Mr. Ritwik Sheth with a follow-up question. Ritwik. Sir let's go ahead with you. Mr. Ritwik Sheth Yeah. Hi, good evening. Am I audible now, sir? Moderator Yes, we can hear from you now. Mr. Ritwik Sheth Yeah. Okay. Hi. So just continue the previous question on the Machine Tool division margin. Mr. V. Senthil (CFO) Yes. Mr. Ritwik Thanks. Mr. Ritwik Sheth Yeah, thank you, sir. Are we looking at any price corrections looking at this price to mitigate this Euro and USD impact on the cost? And secondly you just mentioned that we have some measures to mitigate this. So, are we looking at any domestic procurements substituting the imported materials and is there a good quality replacement for the same? So that is on the machine tool division. The second question is in the textile division, sir. Any update on the auto and the product that we have already launched in the market in terms of feedback from the customers, and you know, is it gaining any traction if you can highlight something on that. And secondly, in the textile division, one of the MNC competitors has skinned in the last year or so. So, are we seeing the benefits of winning incremental orders from these competitors? These are my two questions. Thank you. Mr. V. Senthil (CFO) Okay. See I think the machine tool margins, what you're talking about is basically because of the drop in the top line, right? I think it's the operational margin which has not come in during the current quarter. But as such that apart, the fact still is that whilst replacement with Indian. I think your question basically was are we replacing it with Indian parts? Indian made parts where you trying to avoid imports? Of course, India made components, definitely, yes. Are so as long as they are fit for purpose and serve the purpose. So that is a constant effort from our side to look at all type of parts made, mechanical, electrical, electronic, all type of parts where we look for. Alternatives and effectively price revision is. It does, it does happen. We have to pass on It happens in multiple divisions. For example, in divisions like ATC Foundry, we have a clear clause with the customer for revision of price. So we do that constantly. We do have to. We look at the same thing with Machine Tool as well. It does happen that those actions are taken. But margin drop, what you're seeing in. The current quarter is basically the operational. Margin which has gone down because of turnover reduction and like I always Say, the capacity. Is there for it to do 20% more in the current

situation itself. So, in a very comfortable manner, it Can still do 15% more than what we do currently because the capacity is what we've actually built for this division over the last three years. So, if that kicks in, you will definitely see the margins go up. With respect to auto winder, yes, we have supplied them in the south, the feedback is good. We will be booking orders closer to the last quarter of this year. More orders for more rollouts. As far as auto winder is concerned, I’m not clear on the question, the. Last question on the textile competition. So, I may not be in a position to answer that at the moment. Back to. Thank you. Back to Mr. Samir Moderator Sure, sir. So, thank you so much for answering the previous one. At the moment we do not have any hands raised the people in the attendees, if at all you have any questions, we can have your hands raised and you can have your questions taken. So, we have Mr. Rahul Kumar Mishra. Rahulji, let's go ahead with your questions please. Mr. Rahul Kumar Mishra Hi sir. Thanks for the opportunity. So, my question is pertaining to the TMD segment now given that the Middle east tension has already surfaced again. So just wanted your thoughts on like how this crisis is now. Is it, is it, is it having any impact on the raw materials cost or commodities and logistics? Any, any color on that? Mr. V. Senthil (CFO) Okay. Any other questions, Mr. Mishra? Mr. Rahul Kumar Mishra No sir, that's my only question. Mr. V. Senthil (CFO) Yes, like I just mentioned, the. All the costs, be it commodity, be it fuel, be it the gas and. A lot of these are being used. So, if you look at LPG, if you look at our sheet metal process, we use helium. If you look at So transport costs are up, commodity cost is up, everything is up to some extent. What is more important is how to keep the supply chain resilient for us. To still continue to deliver. And I think there's been a lot of action which our supply chain has done over the period of last two to three months and which has proved the resilience to still roll out these machines. Because a simple example, your sheet metal. Will not cut if your helium is not available. Your special process units wouldn't work if gas is not available. So, I think there has been a tremendous effort from the SCM side to have the systems running apart from that as far as the cost is concerned. If you want a number on that. It could be anywhere up from between three to three and a half percent where the costs would have, would be going up. That is the way we are looking at it. And that is where again the R and D and the design team has to does work on how to mitigate these things. And it's an ongoing process. This is their day in and day out work as far as we are concerned But and, and within this, like what. Just now mentioned in the previous question, price discussions and where we can look. At repricing all that comes into play.But costs definitely have gone up . Availability was also becoming an issue last quarter. It has eased a little bit, but still availability is something we always very keenly look towards to ensure that at any point in time we have got visibility of

four months or five months of pipeline of material available to back up the sales. Thank you over to you Mr. Samir. Moderator So, thank you so much. We have Mr. Manish again with the follow up Question. Mr. Manish Yes sir. Sir, two questions were remained unanswered. One was on the order book, domestic TMD order book and active order book on TMD which I missed due to joining late. And one question which was left was on ATC margin outlook and the CAPEX plan for etc. And sir, one more question on the results part. Like our revenue YoY has grown 25% but our other expenses are up only 4%. So just would like to know that what has really led to this other expense growing only 4% when other sales are up 25%. So, these were three four questions sir. Thank you. Mr. V. Senthil (CFO) Thank you, Mr. Manish. The capex plan for see capex first is on the capex plan of ATC. We are investing in fact we have mentioned in. In quarter ended December 24 we did mention that. There is an MOU which has been entered most of it. One part of that MOU is related to ATC's new facility which is going to be created. So, ATC is going to be for. We are going to have I think 150 crores worth of land building being built. Building basically land is of course our own. So, building being built up for ATC and this, the timeline for this is over at least 18 to 24 months. That's the, that is the requirement because as we scale up the business. This is the, this is the requirement for the, for the business. The margin for the current quarter has been a little bit higher considering that there was lot of the ratio the mix of products versus assembled components. There are a mix and this time there's a little bit higher sale on the assemblies rather than on the components. Hence the margins are a little bit higher. It will equate out to similar numbers. Of last year with respect to text change machinery. What I mentioned at the start was. An active order book of 2400 out of 3200 crores. It was the active order book I. Mentioned with respect to revenue growth versus expenses growth. Yes, we have, We have seen that we are optimizing and I think last quarter when we had this discussion as well, we said. That we are optimizing a lot of cost. In fact, you would have seen VRS Cost in the current quarter. We have seen a VRS cost in the last quarter because again yes things are looking positive both for Machine Tool division, ATC and textile are slowly picking up. But we still are of the opinion that we, we have to have a very tight you know belt around the costs and how we look at cost to be. And that's, that's why you see what you see there. Thank you. Back to Mr. Samir. Moderator So, thank you so much. Mr. Manish Thank you Moderator Thank you, so much.

We have a few more hands raised. The next person would be Mr. Prabhat. Mr. Prabhat Am I audible now? Moderator Yes sir. Mr. Prabhat Hi sir, this is Prabhat from Navneet family office. So, I had two more questions. First on the machine tool division part, what is the acceptance of our J series that we have launched targeted to the EMS sector? And the second question is what is the revenue breakup of MTD division in terms of automobile, EMS, aerospace and others? Mr. V. Senthil (CFO) Any other questions, Mr. Prabhat? Mr. Prabhat No, no, that's all. Mr. V. Senthil (CFO) Okay. See Machine Tool Division this quarter, around 56% is automotive. Balances everything else put together which includes your EMS, general engineering, etc. We generally don't give a breakup of that. But mainly since automotive is a larger portion we give you that. J-series is very good. There are actually six models in J series which of course you can see online. It starts from J1, J2 up to J6 various table sizes, has a good acceptance in the market of which from an EMS or EMS related segment. It is the machine is called J2. Very, very well accepted in the market at the moment. Thank you. Back to you Mr. Sir. Moderator Senthil sir, thank you so much. We have Mr. Ritwik Sheth with a follow up question. With your permission. Can we take him again, sir? Mr. V. Senthil (CFO) Yeah, please do. Mr. Ritwik Sheth Yeah. Hi, thank you for the follow up. So, couple of follow ups. Firstly, on the MTD margins. Historically in good times we've done 12 to 14% EBIT margins in MTD segment. So, what will be required for us to reach back to these levels? Because our top line has been growing very well in the last few quarters. But margin improvement is missing

because of couple of points which you mentioned. What will be required A price increase and mitigation. And when do you see this coming back towards double digit margins? That was the first question. Second is just a clarification. What is the utilization at the textile division in Q1? And last question is on the ATC margins. Would this have been positively impacted by the USD appreciation to INR? Yeah, so these are the three follow up questions. Thank you, sir. Mr. V. Senthil (CFO) Yes, ATC margin is positively impacted by Forex. In fact, if you see last quarter. And that is where probably the comparison. Is not very like to like there Was a huge jump last quarter from 85 to 95 and then of course. It has stayed somewhere in the range of 94, 96. So in fact full year effect. If you see there was a quiet a significant impact of forex last quarter. Compared to this quarter. But yes, ATC does get positively impacted. Textile utilization still hovers around 60 percent. As far as textile utilization is concerned with respect to margins on machine tool business the product mix is one of the key things. Right. So today we are doing like I said 20% plus would be our machining centers. When you see those margins at 12 to 14% today, we have got a much larger base, much more expenses on that where there is enough capacity getting created. So you're talking about probably on 300,400 Crores of turnover with this margin. But today we are doing much more. Varied products and much more larger cost base. Which. Which is where I said that definitely. A turnover to get turnover increase and. Utilisation of capacity will give us better numbers and we can't put a timeline on that. But definitely the effort is to ensure full capacity utilization. That's where the push is towards. Mr. Ritwik Sheth Okay, thank you sir. Mr. V. Senthil (CFO) Back to you Mr. Samir. Moderator So, thank you so much. Thank you, sir. At the moment we do not have. Any of the hands raised. Mr. V. Senthil (CFO) Okay. Moderator But all we have any questions we would request the people to please raise your hand so that those questions can be taken. Mr. V. Senthil (CFO) If no one is there then we. Can close the call. Thank you.

Moderator Sure sir. Since we do not have any hands raised, I believe all of the questions are taken and all of the questions were answered by Mr. Senthil. So, thank you so much for doing the needful. Thank you so much for taking up questions and answering them. Thank you so much sir. Thank you. Yes. Ladies and gentlemen, here we conclude the meeting. Thank you so much everybody for joining us today. Thank you.