Western Carriers (India) Limited (WCIL) Q1 2027 Earnings Call Transcript

Ladies and gentlemen, good day and welcome to Western Carriers India Limited Q1FI27 Earnings Conference Call hosted by MBFG and Time. As a reminder, all participant lines will be in the listen-only mode and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during this conference call, please signal an operator by pressing star, then zero on your touch-tone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Parth Agarwal from MESG End Time. Thank you and over to you.

Thank you. Good afternoon, everyone. I welcome you all to the Q1 FI27 Earnings Conference Call for Western Carriers, India Limited. To discuss the business performance, we have from the management, Mr. Kanishka Sethia, CEO, CFO, and Whole Time Director. Before we proceed with the call, I would like to mention that some of the statements made in today's call may be forward-looking in nature and may involve risk and assumptions. For more details, kindly refer to the investor presentation and other filings that can be found on the company's website and on the stock exchanges. Without further ado, I would like to hand over the call to the management for their opening remarks and then we can open the floor for the Q&A. Thank you and over to you, sir.

Thank you. Thank you so much. Good afternoon, everyone, and welcome to the Q1 F527 Earnings Call of Western Carriers India Limited. I hope I am completely audible.

Yes, sir, you are audible.

Thank you. Thank you. I am joined today by my colleagues Sapna, Surya, Jitalar, and Naveen from the senior management team, and I would like to sincerely thank all of you for taking the time out to join us on this Monday morning right after the Independence Day. We greatly value your continued interest, trust and engagement with the company. During the last quarter, your company has delivered a very healthy growth despite operating environment shaped by geopolitical uncertainty being strong. Your company delivered a healthy 12% growth of revenue year-on-year from 416 crores to 465 crores and a healthy EBITDA of 19 crores with the 9 crore tax, sequential growth of 13% quarter-on-quarter. But before delving into all of this, first let me begin by discussing slightly the broader macroeconomic and political environment before coming to our industry and then specifically back to our business performance and outlook in detail, followed by which we will have the Q&A session at the end as always. So as you all know, logistics remains one of the Today, the global economy continues to operate Thank you. Shipping routes and supply chain resilience. While businesses and economies have become more adoptive than they were a few years ago, these geopolitical developments continue to influence state movements, trade flows, transport costs, and ultimately business confidence across global markets. One of the biggest concerns arising from these developments has been the impact on global trade and energy markets. Any disruptions in critical trade corridors affects not only immediate Thank you. Thank you. Demonstrating the sense of the domestic economy, even amid an uncertain external environment. India's domestic demand indicators have also remained encouraging. The CPI inflation on an average quarterly is 3.90%, which remains within the broadly manageable level. Similarly, the GSP collections continue to reflect healthy economic activity. Now looking at our sector, the long-term outlook for the Indian logistics sector, I feel remains extremely positive. India's trade and logistics market is expected to grow from approximately 316 billion odd in 2026 and further reach approximately 476 billion dollars in the next five years. This represents a long-term compounded annual growth rate of a robust 8.6%. Looking at the domestic macro situation briefly, as it is important to understand the industry and company performance now and going forward, growth continues to be supported by strong domestic consumption, increasing private investment, improving manufacturing capabilities, government-led infrastructure spending, and a rapid expanding disaster. Thank you. Thank you. Thank you. We have marked approximately $142 billion for infrastructure development, representing a 9% rise from the $131 allocated last year. Additionally, the government has invested nearly $84.5 billion in highway construction over the last three years, highlighting the sustained commitment to enhance the country's transport infrastructure. India Brand Equity Foundation reported that the Credit Rating Information Services of India, Bissil, Yearbook 2023, estimates that India will spend about $1.64 trillion on infrastructure over the roughly seven physical years through 2030, more than twice the roughly $770 billion spent in the previous seven years. Indian government is keen to improve the logistics efficiency as can be seen. As part of the Multimodal Logistics Park MMLP program, the Ministry of Road Transport and Highway MOT is developing 35 logistics parks, each spanning more or less 100 acres. Designed with multimodal transportation connectivity, modular warehousing, container terminals, near ports, these parts are expected to streamline freight movement while reducing logistics costs and transit times. You are all well aware, your company's 42-acre Devalia MMCP is a small but important footnote in this vision. It is based in the Swarashtra region in Gujarat and serves all major industries around it, including tiles, industrial chemicals, foods, and others, and is now providing services seamlessly pan-India from Swarashtra to east, northeast, south, and north corners of our country. With a strong foundation and world-class infrastructure, we are providing the entire granite of multimodal services from here, including first mile, last mile, containerization, storage, handling, and this is to chase this movement spanning here. We expect the Devalia MMCP to play a major role in our future prospects. However, some small issues still remain due to the ongoing war. SIP schedules have become erratic, which leads to bunching of cargo arrivals and departures. An example of this is the recent congestion at JNPT that led to a backlog of nearly 30,000 PUs. I will talk about the XM business as we go along in more detail. Now, while India's massive infrastructure push has helped bring the logistics cost down substantially and moving towards the stated goal of below 10% of GDP, Experts feel that the infra alone is not enough, and probably the next stage of progress will come from improving freight speed and strengthening the multimodal integration. For example, India's major freight corridors currently average speeds of around 60 kmph, which is slightly lower than the Western benchmark of around 80 kmph. ULIP, which is the Unified Logistics Interface Platform, has the potential to become the backbone the ecosystem currently lacks. Rather than importers, exporters, forwarders, toggling between ice gates, port and terminal systems, CFS portals, and forwarder updates, ULIP is designed to integrate data from all these stakeholders into a single interface. As it matures into Thank you. Thank you. Collaboration between the government and the industry, coupled with sustained investments in integrated infra and digital innovation, will be instrumental in realizing our joint vision of Avix and Bharat 2047. While India's infra-expansion is reshaping the logistics landscape, the next phase of transformation will depend less on building further new assets and more on making existing ones work together more seamlessly and more efficiently by process reform, as discussed earlier. Streamlined processes, end-to-end digital visibility, and strong coordination across the supply chain We'll determine whether these investments translate into tangible gains for businesses and moving cargo every day. However, at the same time, larger global challenges remain, as you're all well aware of. Trade operators continue to navigate fuel price volatility, shipping disruption, changing trade routes, and cost inflation across transportation modes. Crude oil, diesel, and aviation fuel prices continue to play an important role in determining the transport economics. Any sustained rise in fuel costs can and will impact operating expenses across the logistics ecosystem. It is also pertinent to look at the global situation currently, what with the prolonged Middle East crisis and its ramification on our nation's The most important critical import, which is fuel. As you can readily expect, the impact looks different in road, sea, and air cargo. Fuel inflation does not affect every mode in logistics in the same way. One of the most useful ways to understand the issue is to separate logistics into road, ocean, and air. Each reacts differently because their operating structures are different. Road transport faces immediate pressure. This explains why fuel link trade contracts are becoming the norm and why transport associations have moved quickly to propose fuel adjustment mechanisms. Yet road transport remains dominant despite higher costs. India's logistics network still depends heavily on trucking because road handles the first mile and last mile, which is critical for delivery. Rail may move bulk cargo efficiently and without much dependence on diesel, but goods still need trucks to reach factories, warehouses, ports, or customers, for which the first mile and last mile is completely dependent on road. Looking at sea freight, ocean carriers are moving quickly to pass on the cost. Shipping lines have increasingly layered new surcharges in response to disruption and fuel-related pressure. Carriers have rapidly introduced emergency bunker surcharges. Even inland transport linked to ports has become more expensive with export and import fuel surcharges increasing applied on Indian routes. Air cargo phase is a different challenge altogether. Unlike road transport, airlines already use a fuel surcharge linked to aviation fuel prices, but obviously the present environment has pushed cross pressure much further than normal. So the more question to consider is this. Are supply chains beginning to change behaviour? The larger question for logistics is whether the rising fuel prices will eventually reshape supply chain behaviour itself. At the moment, though it is still too early to clearly measure behavioural shifts such as fewer dispatches, shorter transport corridors, all cargo consolidation, but companies will eventually seek ways to minimise their logistics costs. But change may already be visible in some areas. In export supply chain, for example, we are working very closely with our clients in increasingly rethinking shipment planning, shifting dispatch cycles, and consolidating cargo to improve transport economics. For non-urgent cargo, companies may gradually begin asking a larger question. Does every shipment need to move by road in the same way it always has? Which brings us to the most pertinent question for your company, a leader in multimode. And that question is that, could higher fuel prices push and accelerate India towards multimodal logistics? For years, India has discussed reducing logistics costs by increasing rail and multimodal transport. The argument is simple. Road transport offers flexibility, but rail can move large cargo volumes at lower cost on suitable corridors. The challenge is always in practicality. Road transport remains dominant because businesses value speed, flexibility, and last-mile connectivity. Thank you. Long-haul cargo, which is a total game-changer in terms of speed of acquisition. For bulk and non-time-sensitive shipments, a hybrid road and rail approach is increasingly making more economic sense, and your company remains well-poished to reap the benefits of this move, having been one of the pioneers in the same. The economics are becoming harder to ignore. Higher diesel prices are not simply increasing freight bills. They are forcing logistic companies, freight forwarders, and cargo owners to ask difficult questions about efficiency, pricing, and network design. What once felt like a short-term cost increase is beginning to look more and more like a structural rethink of how goods move across India. And here, needless to say, your company remains at the vanguard of this move towards more multimode, riding on more than five decades of experience in the multimode supply chain and a clear leadership in the same. Now, let's deep dive into your company's numbers and performance for Q1. Starting with container volumes during the quarter, let me first read out the numbers and then deep dive into the same. Let me first give you a comparative container numbers year-on-year, that is quarter 1 at 526-27, as opposed to quarter 1 at 526-26. And first, looking at the domestic numbers, we delivered in quarter one of this year 23,909 as opposed to 17,498 domestic TUs, which is an absolute growth of 6,411 TUs and a remarkable growth of 37% year on year. Looking at the exam numbers, we delivered 34,352, compared to 33,286, which is an absolute growth of 1,066, a more muted growth of 3.2%. Adding the two together, we delivered 58 to 61 containers, compared to 5784 last year, an absolute growth of 7,477, and growth combining domestic inheritance of near 15%, which is quite remarkable. If you look at the numbers comparing sequentially, that is quarter 4 of last year with quarter 1 of this year, quarter 4, as all of you know, remains a dominantly large quarter in the logistics industry, but I am happy to say that we have actually beaten our quarter 4 numbers in total in quarter 1, which is extremely remarkable. We delivered in total 58,261 containers, like I said, as opposed to 57,754 in quarter 4 FY26. This is the first time that we have recorded this. This is remarkable for us. In absolute terms, though it's a small increase of just 500 TUs, but to have quarter 1 numbers So, those are the comparative container numbers. We are seeing very good demand in the domestic stream as is obvious from the numbers above, both in the DSO as well as the specialized containers. And seeing the growth in the specialized containers, your company has placed order So, for a further 150 specialized potty feed containers during this financial year, as per the client requirements, we have already gotten delivery of the first 50, and the next 100 are scheduled for delivery in this quarter. Strong domestic growth is making our business, you know, the numbers are starting to reflect in our total business. Our total domestic versus exit numbers are now trending more or less 40 to 60, which earlier till about a year or six quarters ago was 30% domestic and 70% exit is now almost 40% domestic, It's exciting on the growth that we have been doing quarter-on-quarter on our domestic business. Even Exim, we have managed to grow year-on-year, though Exim markets remain under stress, as you all know. Exporters are facing another round of freight escalation. Shipping freight, especially to the critical U.S. and European markets, have gone up three to four times in the last couple of months. In some routes, for example, the rates now are almost $9,000 at EU compared to $3,000 at EU a couple of months earlier. Main issue is timely availability of vessels rather than shortage of vessels. Congestion at boats has disrupted vessel schedules affecting availability of vessels for booking. The continued use of longer Cape of Good Hope routes adds additional 15 days to voyages to the U.S. east coast for the impacting vessel turnaround times. At the same time, festive season demand, which peaks in quarter two every year, has further intensified the problem and pushed the freight rates up. This added to the war risk surcharge, traditional transport surcharge, et cetera, have increased freight costs manifold. All of this impacts our Exim numbers' growth as we are a derived industry, as you know. However, I remain extremely optimistic about our Exim business going forward. War has to end sometime, and I am not brave enough to guess when, but when it does, we expect a huge jump in our Exim volumes as well. which, on top of our domestic numbers, portends very well for our growth in the coming quarters. Now, looking at the numbers, I am pleased to share that despite very tough macroeconomic environments and continued uncertainties across large parts of the global logistics ecosystem, the company delivered a robust operating performance during Q1 FY27, Thank you. Especially in the domestic stream, relentless focus on execution, and our ability to leverage the diversified nature of our service office. More importantly, we continue to remain focused on building sustainable revenue streams while maintaining service quality and operational discipline. As I have always maintained for us, the emphasis is not merely on growing Thank you. While external factors such as fuel costs, trade dynamics, and competitive intensity continues to influence margins across the sector, our focus remains firmly on improving operational efficiency and creating a stronger earnings profile for the long term. Pat for the quarter stood at 9 crores approximately, compared to 8 crores in quarter 4 or 5 by 26, which registers a healthy sequential growth of approximately 13% quarter-on-quarter. Pat margins have also improved from 1.7% to 1.9% in the preceding quarter, and this reflects an expansion of a healthy 20 basis points. This improvement underscores the benefits of our continued focus on efficiency, disciplined execution, and a profitable business mix despite the evolving market environment. We remain encouraged by the underlying momentum in the business and continue to see operations for both revenue growth and margin improvement as market conditions continue to evolve. Over the last few years, we have consistently invested in capabilities that stand in our competitive positioning and improve our ability to serve our customers across increasingly complex supply chains. As a result of the investments made in the past, our fleet in specialized containers today remains one of the largest in the private sector in the logistics space. These assets not only spend in our service offerings, but also allow us to participate in higher value-add logistics opportunities, where our operational expertise becomes a great differentiator. Looking ahead, our capital allocation strategy remains both disciplined and customer-driven. For FY27, we continue to evaluate growth opportunities across myriad specialized equipment, container assets, multimodal infra, and tech-led solutions. We currently envisage a CapEx program of approximately 100 crores during the financial. All the timing and the scale of the investments will remain deeply linked to the customer's commitment, the volume visibility, and also specifically to the prevailing market conditions. As we move through F527, our focus will remain on balancing growth investments with prudent financial management, while continuing to create a long-term value for our customers and shareholders. Before I conclude, I would like to sincerely thank our customers, our employees, our partners, our lenders, our shareholders, and all our stakeholders for their continued confidence and support. Looking ahead, we remain extremely confident about the future, and I hope that it will continue to be part of our journey. Against this backdrop, our focus remains firmly Thank you very much.

We will now begin the question and answer session. Anyone who wishes If you wish to remove yourself from the question queue, you may press star and 2. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while a question queue assembles. The first question is from the line of Keshav Ghar from Counter-Cyclical PMS. Please go ahead.

Sir, thank you for your opening comments. And sir, we do understand that there is a war going on and container rates have gone up and there is a disruption in exempt trade. But so does our customers. So the question is that why are we unable to take a price hike? Or is it that we have entered into some kind of a fixed price contract with our customers, due to which basically we are unable to increase our rates and consequently we are facing the margin pressure?

Sir, it's a very good question. Actually, it's not a yes or no answer. It's a bit more complex. So what happens in complex supply chain is, yes, you are right, most of our contracts are long-term, as you know, we have four-year, three-year long-term contracts. They have some sort of, you know, flexibility built into them, but they are more or less stable in their business outlook. But what happens is, when you have, you know, the broader macroeconomic situation, what it does is it disrupts the smooth running of the supply chain. So, for example, giving you one example, say for geopolitical reasons, as, you know, the vessel arrivals and vessel departures cycles, they sort of get, you know, top heavy or bottom heavy. So what happens is if your numbers, your movements are slightly, you know, non-cyclical, there is shortage of vessels at some point, so that creates congestion at ports, which leads to disrupted vessel schedules, you know, which affects the entire supply chain, from the ports to the railway haulage to the first mile to the last mile. At some point, you know, you have less cargo to manage your supply chain, and at others, you have cargo which gets clubbed. All of this leads to, you know, the margin hit, you know. So that becomes a problem for us because, you know, as the realization, you know, gets affected because of this, because as your numbers are not linear, your supply chain also sort of starts taking a hit, Both at the front end, which is for exit, as well as for the out end, that is the export number as well. But, you know, as more and more time passes, you will see even in our numbers that the profitability is improving, the EBITDA is improving, because we are all learning to live with these disruptions. And these disruptions ease out soon, and your guess is as good as Thank you. The domestic side of the business, we've grown sequentially quarter on quarter in very strong double digits. In fact, quarter, what I was saying, in quarter one this year, we've actually grown almost 37% year-on-year compared to our quarter one numbers last year. So we've done and we've managed and controlled what we can, and we've tried to create as much efficiency in our existing business so that we've actually managed to finish the year A net positive, which is quite remarkable given the situation currently. So, we are very positive, sir, that going forward we should be able to not only improve our revenues from operation, but also our profitability. So, it's a slightly longer take on your question, sir.

So, basically, Mr. CTA, so shareholders have to, you see, now this is a new normal. Whether it's an Iran war or before that, the tariffs due to which again there was a container shortage and so on. So if tomorrow China invades Taiwan, then again there will be something. Now, the point being that this is nothing new. Something or other keeps on happening. So, I mean, we have to basically, we are basically insulating our customers on the XM side from whatever volatility is there. So basically, that's not a good business model. Basically, the risk is on me, the customer, regardless of any war or any container, freight, turbulence. The customer pays what he was paying and we take all the hit. And we wait for the macros and the world piece to return. So, I mean, it's not really a one-off. These things will keep on happening. So, I mean, are we really waiting for a few quarters of world peace, wherein we will clock some good numbers and then again? So, I mean, I don't see this as a world-time affair, this turbulence and whatever is happening in the past few quarters.

No, sir, it's a fair question, but I tend to disagree. I don't think we've been waiting at all, sir. Year on a year, we have grown almost 13-14% despite all of this war. In fact, our quarter one numbers are the largest quarter one numbers that we've ever delivered. So we've actually, you know, pivoted and done what we can. That's what I was trying to say. Since, you know, the war is something which is not in my control, what the company has Thank you. We are looking at a very strong growth both in top-line and bottom-line. So I don't think that we have been waiting or we are really dependent on that. We have pivoted very strongly on our domestic side of the business, which is being helped by our large MMCT project at Devalia in Saurashtra. And that's a large, big-ticket container terminal that we have run. And we are running it exclusively with Container Corporation and we are getting good numbers out of it. We are getting good numbers out of our other plans for the domestic scene. And what I was saying was that I am very hopeful that if the exit situation sort of eases out, we will be able to see a compounded growth on top of what we are already doing. I mean, we have already grown 13% year on year, so it's not that we have been not doing much.

Sir, so I am totally with you. I appreciate the volume growth that you have been doing. But the point is that it is not profitable enough. I mean, if we look at our working capital days, it has doubled in F-22 from 58 days to 120 days. Today, our debtor days is 142 days. Our return on equity is less than 5%. So, there is basically no, if we look at our past six-year cumulative operating cash flow, it is minus 43 crores. So, basically, if you think about it, we are basically subsidizing our customers, essentially. Because if the volumes are growing, we are serving more customers. But if there is no increase in cash flow, the working capital keeps on increasing. So essentially, we are subsidizing them, our customers. So it is not really a profitable business. And my basic question is that, do we need to wait for world peace or until world peace arrives, can we, why aren't we asking for a price hike with our customers? Because you see, these factors are the same for everybody. It is not that a company specific, that Western carrier costs have gone up, whereas everybody else costs are the same. Costs have gone up for everybody. So, why aren't we asking our customers to give us a price hike?

Sir, this is a wrong assumption that there is a discussion on price hike or we are subsidizing our customers coming to what you were saying about working capital. Actually, our working capital days have reduced from 120 in the last quarter to about 111, which is a nine-day reduction. Similarly, our database has gone down from 139 to 135. Our cash flows net positive was 9.2 crores in quarter four is about almost 13 crores in the first quarter. So all of the numbers are actually improving. And we are a derived industry, sir. We cannot subsidize our customers. My customers are extremely large blue chip companies. So, I really don't have, you know, that kind of wherewithal to subsidize them. But what we can do is streamline and make our operation more profitable. That is what we have done. That's what we have achieved over the last 90 days. And that's what we are hopeful of doing. We're not really sitting and waiting for the war and global peace, etc. We've pivoted our businesses and streamlined our supply chains to the best that we can. And we have seen results of it. We remain profitable and we remain committed to increasing both our top line and bottom line for all our investors. I think we have done a hell of a good job in the first quarter given the situation. 12-13% growth in top line and bottom line. And we are committed to try to do even better going forward, sir. So I think we are sitting on a great opportunity, not only in the domestic, but also in exit. I mean, what I am trying to say again and again is once the situation, you know, stabilizes or improves, we should see the numbers even improving further. That's what my hope is. And even without it, our numbers are quite good. They're not bad by any stretch of the imagination. And I hope to keep on improving on all the matrices. Thank you.

Mr. Keshav, I would request you to rejoin the queue for a follow-up question. Ladies and gentlemen, in order to ensure that the management is able to address questions from all participants in the conference, please limit your questions to one per participant. Should you have a follow-up question, we would request you to rejoin the queue. The next question is from the line of Kaurstav Bhubna from Kamana Holdings. Please go ahead.

Yeah, hi. So, you know, I'd just like to say that, to the previous analyst's point, that we shouldn't assume, a suggestion is not to assume that this war will get over in a few months or in a few quarters and plan for the longer term, where there could hypothetically be a scenario where the war goes on for three to five years. At least plan for the worst. Because what I'm seeing is that, and I'd love your view on this, which I obviously have questions attached to this, is that the cash base you had of 200 crores is now depleting because your working capital cycle is getting stretched. Your debtor days is increasing every year. So, my question is, why is your day-to-day not easing out? Why can't you use this bad market conditions to actually, you know, go to your customers and at least get some money back from them while the market conditions are bad, which is obviously impacting your true potential of growth and profitability? Why can't we at least use this market to improve the working capital and improve our cash? Because, you know, I'm assuming that your capex will still stay elevated. So another question is also what will your capex be this year? And if your capex, irrespective of what your capex is, if your working capital keeps deteriorating, your leverage will have to go up if the market conditions remain this way. So, you know, I'm concerned that if, you know, you hope that these market conditions improve, they never do, you know, your borrowings will eventually go from 200 crores to 1,000 crores with a blink of an eye. What's your view on this? What will your capex be this year? Why can't you collect money from your customers to improve your debt-to-days? Those are my questions.

Thank you, Kostav. Thank you for your call. Thank you for joining. I'd like to point out a few things. Actually, our working capital days, like I said, has reduced almost 8-9% in the quarter from 120 in the last quarter to 111 in this quarter. Similarly, our debtor days, paid receivables has reduced from 139 to about 135. Hence, improvement is visible in the payment cycle. We've been working very hard on this internally as well as with our customers in trying to improve this further, which I had promised, and we are pushing very hard on this. It has also, the debt remains pretty much, you know, if not actually our debt has not gone up, it remains stable. And so, you know, I don't think that we are looking at increasing our debt from 200-odd crores to 1,000 crores, like you said. In fact, our debt, you know, my team tells me, has reduced from March end from 270 to about 197. So it's actually almost a 10% reduction in debt that we've done. And, you know, despite adding new businesses, new customers, which is fairly visible in the numbers, 13-14% growth, will actually not increase our debt, which means the payment cycles have improved, will not increase our working capital gains, which is actually reduced close to 10%. So, we are doing what we can cost us to ensure that we remain highly profitable and the only time our debt will go to a thousand crores, that is five times of what it is now, is if we manage to grow maybe ten times of where we are now. But I don't see a lot of work internally as well as with our customers and those numbers are reflecting. We remain confident that what we are doing is going to be long-term beneficial. You can see that in the shareholding as well as promoters increase our shareholding and so comfortable and confident. So I feel that we've turned the corner. I'm not really worried too much about recurring theme. Like was pointed out earlier as well, but we've pivoted hard into businesses which are not dependent on Exim, that is basically looked at domestic, we've looked at specialized service offerings in domestic, we've gotten good traction for our specialized containers, we now are one of the dominant forces in it. Our DSO business is now almost 40% of our top line. It was less than 25%. So we've managed to grow the domestic business. We remain focused on growing the domestic business and piggybacking on our large MMCT. In Devalia, we are also working on a couple of large projects, Adogai and other places. I am very focused on, you know, much of this domestic growth has come from our customers who are also our answers. Part of your question, Kostav, and I am happy to connect after the call as always.

Mr. Kostav, if you have a follow-up question, I would request you to rejoin the queue. The next question is from the line of Suhani Singh from ROS Capital. Please go ahead.

Hello. Hello. So, I just had a few questions. The company has been making investments in various assets and equipment. So, what return thresholds guide these investment decisions, and over what time frame?

Repeat, I have not been able to hear you. Can you please start your question again? I have not been able to hear you properly, please.

The company has been making investments in various assets and equipment. So, what return thresholds guide these investment decisions, and over what time frame do you expect these investments to become earnings accretive?

Thank you. You know, in a single day. So we cannot do that. So the Capex depends on ensuring that our supply chains remain robust. At the same time, whatever Capex we do is basically done for assets and equipments which are not, you know, readily sorted or available in the market. And so we look at our assets, you know, giving us good returns. There's no benchmark number for the returns. But I'd say a healthy double-digit return is what we expect from all our assets, be it specialized containers, heavy-duty equipments, commercial vehicles, which are mostly specialized. So we look at a highly profitable allocation of our CAPEX plan. And we've now, you know, been doing this, you know, very, very risk-free kind of CAPEX planning for a long time. And so we've been quite successful in running this plan. So, we are very confident, actually, in the KPEX that we are doing. None of it is taking very large risks.

Thank you. Ladies and gentlemen, we take that as the last question for the day. Now, I would like to hand the conference over to Mr. Parth Agarwal for closing comments.

I would like to thank the management for taking the time out and to all the participants for their questions. If you have any further queries, feel free to contact us. We are MUFG InTime Investor Relations Advisors to Western Carriers India Limited. Thank you.

On behalf of MUFG InTime, that concludes this conference. Thank you for joining us and you may now disconnect your lines.