Chaman Lal Setia Exports Limited (CLSEL) Q4 2026 Earnings Call Transcript

I welcome you all to the Q4 and F526 post earnings conference course of Chamantral City Exports Ltd. Today on the call from the management, we have with us Mr. Rajiv Satya, Joint Managing Director and CFO, Mr. Ankit Satya, All-Time Director, Mr. Ankit Satya, All-Time Director, and CA Kaurav Mahi, part of Finance Teacher. As a disclaimer, I would like to inform all to you that this call may contain forwarding statements which may involve risk and uncertainties. Also, this is a reminder that this call is being recorded. I would now request the management team to detail us about business and performance highlights for the period ended March 2026, their growth, perspective, and vision for the coming years, approach which we will open the floor for QM. Over to the management team.

Good afternoon, everyone. I'm so happy. Today, and all the team should be happy, and my investors should be happy with the performance of the company as a whole year and as a last quarter, 31st, 26th. You may have seen the press note and read that, and you must have been appraised with all the figures. The company has announced a dividend of 3 rupees 3 per share, so I hope everything goes well in the future also, and you're welcome for your question, sir. Thank you. Ankit, you want to say something?

No, Chacha. It's been a profitable year. I hope the investor is happy.

Thank you. Thank you. All those who used to ask questions, we use the option of raise hand. In case you are unable to raise hand, just drop a message on a Q&A box. Sir, we'll take the first question from Gunit Singh. Gunit, you can go ahead, please.

Thank you for the opportunity and congrats on a great set of numbers. So, I want to understand how have we been impacted by the current Iran war in terms of realizations of our rise, also in terms of any disruption in shipping in March, April, May, the current situation. So I would like to do a little views on that.

Mr. Gunnit, first at the outset, I'll thank you for appreciating the figures of the company. Yes, your question is most pertinent that this war, how it has affected. If I say it has not affected, it will be wrong. Admitted, it has affected the entire export community, import community in India. And most of the nations are hit by this problem. But as we always say, or the the company. The company works in multiple countries. I have not, we go with a separatist. We are not only dependent upon Middle East. Of course, Middle East is a very good market for us, but the rest of the world is also serving. We are in more, about 100 countries now. Yes, this effect is there, but you see the hold handling has come from the government also. Whatever the shipments we made prior to war, and we had to pay extra charges by ocean freight or war charges and so on and so forth. And ECGC has given a... It has been mandated by government of India to to help the exporters and whatever are our extra charges. We have filed the claim with ECGC. We will get that. That will be reimbursed to us. So, but the countries where export is happening to the ECGC, it's regular. In the past, once there was disturbance, this Iran-Iraq war, sorry, Iran and Israel war. Red Sea was also hit, but this time Red Sea is open. Our export to Egypt, export to Lebanon, export to Jordan is continuously going, and it's more, more consignments are going. Maybe they are reselling to other parts of the world, and the rest of the ocean trades have gone up, but they have been factored in our prices. And people do understand because of the crude prices higher, the transportation cost logistics are relatively high as compared to the past. But it's the business and it's the essential food product itself and it will continue to sell.

What it says, in terms of overall volumes, say, pre-war, it was 100, for example, just for our understanding purposes. So, I mean, during war and currently, how much percentage would there be a fall in the volumes because of these disruptions to the Middle East?

You see it is to some extent The premature stage also because if the demand is full, demand is too much, particularly from Afghanistan, so much demand, I'm getting calls every other day. But there is no route. To send cargo, because it has to go to Bandarabas, Vaya. Right now, other parts are taking because, as I said, Red Sea area, a lot of cargo is going. How it is moving to other parts is there. And we are shipping to Dubai, through Dubai, Korpatan and Fujra ports. The cargo is going to other parts. Oman is no problem, it's regular. And, uh, hmm? Oh, yeah. And sorry, there was in between disturbance. And yes, this Saudi shipment to Jeddah are going, and there's no problem. But ocean flows are very high. The buyers are relatively store to buy.

Good morning, sir. So, do you think that these higher demands from, I mean, other shipping routes, have they compensated for, say, the disruption or the volume fall that might have had? So, in, I mean, for Q1, we can expect things to be fairly normal in terms of volumes. Is it fair to assume that?

Fairly, yeah. In terms of the first pair, yeah.

Got it. And in terms of EBITDA margins, I mean, what kind of margins are we looking at because of this higher freight, higher scenario? Are we able to maintain the margins of Q4 and FY26 in Q1?

Let's wait for the time. It's premature to say anything right now. Because the machine rates are high. But business is happening. There is no stoppage of business. And always remember, whenever there is any war or any kind of disturbance, people don't go for luxuries, they go for essentials, and particularly food. So, there is no call.

So, in terms of the supply scenario for rice, I mean, do you think that the situation is fairly normal? Because, I mean, have there been a fall in the total rice supply? Can that be a constraint this year?

You know, there is a reasonably good crop. Why should there be a fall? The one thing I am going to tell for all of us. And all those who are listening, the prices of rice from the onset of this season were very low and very attractive. And some of the people were saying that there's very large crop prices will fall, this, that. But our business wisdom said, and particularly the chairman always pleaded that we must buy as much as we can. And we did that. And you see, there has been 30% increase in prices from November, December to March. That is one of the reasons of getting good gains, you know. And Ankit, better you explain next year.

Got it. And how are the realizations in Q4? I mean, what were the realizations on average? And how are they trending currently in April, May?

Yeah, the prices are high. It's good. Even if they come down, they're very good because we have purchased at a very comfortable and very reasonable prices. We have stocks.

So, my last question would be regarding our numbers in FY27, FY28. So, in one of the previous calls, you mentioned that the company stays at, say, 700 crore to 800 crore revenue. It stayed for four years. Now, it's been about three, four years. We've been around 1,400 to 1,500 crore revenues. So, I mean, should we expect that FY27 is the next inflection point for growth? Or, I mean, is there a, can that be postponed because of the current disruptions?

No, this, because the first thing first is, cargo is moving in this part also, maybe through other directions, one. And The rest of the world, it is perfect. As regard Europe is concerned, US is concerned, Canada, everywhere, Australia, everywhere, it's going in a full swing. Yes, historically, we have seen that three years, sometimes continuously, are almost constant. And after three years, suddenly, it goes up. And we are roping a company which is buying very large quantity. And they are visiting our factory shortly, next week. And if we get approval, they always say we want to deal with your company. You are not cooperating much, not attaching to us. But now we have decided. After all, we tell them if you will give us meager profits will not work. If you give us reasonable profit will definitely work and your business will grow. Because it's the trust also and it's the goodwill of the company what you say and you supply and you keep live up to your commitments and expectation of where the business grows.

Thank you very much. And please consider share buyback because we have large cash reserves and buyback is an efficient way to return money to the long-term shareholders and also increases the EPS in the long run. It's tax efficient. So kindly consider share buyback going forward as in returning shareholder money. Thank you very much, sir.

Thanks, Nunez. Sir, we'll take the next question from Harleen. Harleen, you can go ahead.

Hello, am I on the table?

Yes, yes, you are.

Good afternoon, sir. Thank you for the opportunity. So, I have few questions. My first question is, export has been strong over the last few years. How much of the recent growth has come from the market share gains versus overall industry growth?

Can you repeat your question, please?

Sure, sir. Export growth has been strong over the last few years. How much of the recent growth has come from the market share gains versus overall industry growth?

Hmm, overall industry, export is, uh, uh,

I think she is trying to ask this growth that we have seen is because of market share improvement or because of the growth in the industry overall.

Both sides, you know, industry, business is also growing, and the company itself is growing all around. We are participating in every single exhibition, and we get new customers. Recently, this Sankesh and Mr. Vijay Satya were at Thayfax exhibition. We got new customers also, and obviously, it will add to our kitty. And, of course, Vijay was there. He always says this kind of exhibition gives us opportunity to go for some new products or new things. We are looking forward for anything which we can do the best, you know.

Okay, sir. Sir, my next question is, which specific countries are expected to drive the next phase of growth over the next three to five years?

Okay, yeah, you give, you say, people, okay?

Harleen ji, how are you? I'm good. In terms of increase, I think we'll be focusing on USA and Europe going forward.

Thank you. So my next question is what percentage of revenue comes from the top 10 customer?

Then, I need to check, but it should be, I think, about 35 percent.

Correct. Okay, 35 percent. It should be around 35 percent. 35 percent from the biggest customers.

Okay. And my last question for now is, has customer concentration increased or decreased over the last three years?

No, our customer base is always increasing. We are always, you know, looking out for new customers. So, it's always increasing. It must have increased drastically from last three years.

Thanks, Arne. Sir, we'll get the next question from Tanya. Tanya, can you go, please?

Good afternoon, sir. Thank you for the opportunity. So, sir, our recent profitability has benefited from favorable export realizations and lower freight costs. So, how much of the current margin profile is structural versus cyclical?

Ankit, you'll answer or should I?

Ankit, Chacha, you start, please.

As I have already explained, that in this particular year, at the beginning, the prices were low. Company has vast experience of this industry. We are with this business for more than four to five, four decades at least. Even wisdom matters a lot. The chairman this time, me, both of us, decided, and Ankita, of course, along with us, that we should buy, it's the right time, we should buy the biggest inventory, should be built up the best, biggest possible. Overall, gadongs were full at the lower price. We still have stock. And We are selling. We are sure what to gain. Prices are high now. We are able to sell.

Okay, sir. So if the export realizations were to fall by around 10%, while the PADI prices remain elevated, what kind of impact would we see on the EBITDA margins?

Can you say again about the faddy point?

Yeah, so, you're saying?

Yeah, we are not clear about your question, can you?

He's saying that if paddy prices remain where they are, and if export realizations were to drop, then what do you think will happen to margins?

Yes, this year, you know what happened? The prices of paddy were low. Farmer runs and sells in first two months. Till December, almost 80-90% of the paddy is sold out by the farmer, and the prices were low. Consequently, the prices of rice were also low. And truly speaking, as a businessman earned more, farmer didn't this time. And let's see, because they have those who kept some stocks, they could sell at higher prices also. Maybe 20%, 30%, whatever the farmer kept waiting for the prices to go up. They got good money. The prices of rice had been high. And I think the farmer should grow more and more this year.

Okay, sir. So, as inventory is a key component of a business model due to seasonal procurement, so what is the management's target working capital cycle?

Ah, what's the question again?

Gaurav ji, can you answer it?

The question is not here.

Ah, you can do it.

So what is the management's target working cycle, working capital cycle?

Target cycle of finance?

Working capital cycle. Working capital cycle.

I think it is maximum 40-45 days.

Our current working capital cycle is approximately, debtors are 60 days and inventory is 140 days. So approximately 190 days working capital cycle. So do we look to maintain this working capital cycle?

We will maintain. Why not? We cannot maintain it. Better. It will be better in the time to come.

Okay, sir. So, one last question. Is the company exploring any adjacent categories such as packaged foods, ready-to-cook products, rice derivatives, or any value-added exports? Or the focus is to scale up the branding business?

Hello, Rains. As regard to branding is concerned, we are right now branding outside India. We have our brand in around 40-45 countries, and in some places it's selling great. It is also famous. Yes, Indian market is still we are through online sale through various portal is going on. But the visibility is relatively less in India and that is our next target because company has funds, company has no problem in we are going because the prices suddenly go up in Indian market was not accepting. Otherwise, I could have started by April onward or earlier also. But international prices, the high prices were working well. No problem. We were studying over there. Once the prices are little stable and our Indian market start accepting, I am tying up new distributors in the domestic market. It deserves to be, I mean, It should be famous in India, our brand. Lakshi brand should be famous in India, which is not as yet.

Okay, sir. Thank you. That's it from us. All the best.

Thank you, sir. We'll take the next question from Aman Soni. Aman, you can go at me.

Hi, very good afternoon to all. So my first question is on the current situation in the export market. So is there any kind of shipments stuck or any dumping happening from any other countries?

Hello, Aminji.

Yes, hello.

So, Aminji, as of now, no shipments are stuck. What was your second question, sir?

Any kind of dumping if you are witnessing from any other countries?

No dumping, sir, because for Basmati only, India is the producer, and the brands we are exporting, they are strictly packing all Indian rice. So, dumping cannot happen. So as far as any... Obstruction because of the war. In the month of February, when the war started, Feb end, some obstruction came, but now everything is smooth.

Okay. So, like, you know, sir mentioned, you know, business is continuing to go on, but still, you know, you would be paying, you know, very increased freight costs or any insurance premium. So, if you can highlight on that as well, what is the increased, you know, cost there?

So, after, I mean, like the war started, of course, the insurance cost and Anu. So, of course, the freight cost and insurance cost has gone up. But, you know, all these expenses are mostly borne by the buyer who is importing. Prices are calculated based on that.

Okay, so it's an entire pass-through.

Yes. Maybe, you know, initially we adjusted some part of the freight and insurance. But now, going forward, everything is on the buyer.

Okay. All right. And also in the opening remarks, you know, sir, I had mentioned regarding a visit that a customer was planning to your factory. So if you can elaborate a bit more on that.

I think Rajiv sir will tell more about that.

One of the biggest importers from Saudi Arabia, a very reputed company, they had been buying from 30-40 rice mills. And you see the mills are small. They don't live up to their commitments. The prices go up. They start blending this and that they are facing. And that's why we have been avoiding such companies, bigger companies, because they don't let you earn much. And I have told them that you have to pay price. You have to pay. Because unless everybody in the chain doesn't earn, the business never happens correctly. So you just want to squeeze your supplier so they will spoil you. They agreed. I had meeting. They are coming to visit a factory in Karnal and they are also going to our Gujarat unit. And I'm confident now. What they expect, they will get the quality, and we'll get our margins, and the turnover can come, the business of 30,000, 40,000 tons can increase in-house. If it happens, very good for us, and the rest of the business as usual will be going on.

Sankesh, where are you?

Yes, I'm here.

Okay. So 30, 40, 1000 tons on a monthly quarterly.

This company buys to about two, two and a half lakh already they're buying from India. So they will share some part to begin with. The rest it depends, you know.

Okay. Okay. All right. So, I mean, another question would be, I mean, on the news, you know, what we are, you know, witnessing, I mean, reading about, you know, this El Nino, what all, you know, things, so any kind of, you know, what, in terms of, you know, the procurement, what kind of impact are we expecting?

You see, now the farmers get to, so. The paddy, it's a premature stage to say anything. Let's see how the quality of crop, size of the crop, area and cultivation, and it remains healthy till end. This all matters.

Okay, all right.

My last question.

Hello.

Yes, someone, you can continue.

Yeah. So, just one last question would be that, you know, post this war, is there any increased, you know, demand, you know, coming in from any of the export markets or is it business as usual?

As of now, it's business as usual.

Okay. All right. That's it from my side. Thank you so much.

So, what is, I would add, so what is happening is because of the war, especially rice, which was going Iran, the process has become very slow. Demand is there, but the process of reaching has become very slow. So that's the only change. That too only for a country like Iran. Other countries still managing.

Okay, thank you. Sir, we'll take the next question from Surabhi Mishra. Surabhi, you can go ahead, please.

Hello, I'm an audible. Yes, sir. I wanted to know that the company has built significant scale in rice exports. So, what is the next growth engine that can potentially become 20-30% of revenue over the next decade or are we effectively betting only on continued growth in rice exports?

See, majorly we are betting on continuous growth in the rice exports. Of course, we can start strong with our domestic sales. That still we've not explored. And maybe we come up with different projects also in the future. Maybe we can start with spices. We can start with rice puffs. So everything is there. And we can start with them in near future.

Okay, thank you.

You're welcome.

Thank you, sir. We'll do the next question from Manish. Manish, you can go ahead, please.

Yeah, thanks. So first of all, I would congratulate the management on the superb set of numbers. So, I have a couple of questions. One, I just wanted to flavor as to how are our new units doing? What is the capacity utilization there? And are all of those units already operational? I know those were operational, but I guess there were some four or five units. So, all of those are operational and what is the current capacity utilization of those units?

Mani, so three units, new units have been installed. And they've started to work. Regarding the efficiency, what you asked, they would be working at around 50% of their efficiency, normal efficiency.

So in terms of sales, right, what would have been the contribution from these new units? Let's say for Q3 and Q4, would you have a number?

I would not have a number, but I can give you an idea. One unit can give a sale of around, it should be around 15 to 20 crores a month.

Vaneesh, do you have other questions?

Yeah, thanks for answering that. I have one other question. So Rajiv sir was talking about good demand coming from say some of the countries like Afghanistan and maybe even Jordan or Lebanon. So just wanted to understand as to what is driving the demand. Is it because customers have kind of almost exhausted their stock of inventory or they expect the war situation to kind of continue? A bit longer, and they hence want to kind of stock up more of inventory. So, just wanted your thoughts on that.

So, about Afghanistan, Afghanistan primarily was buying all their rice requirements from Pakistan. And some problem happened between Afghanistan and Pakistan, and suddenly Afghanistan came towards Indian rice. So, that's the reason how Afghanistan is importing so much rice from India now. But the process of exporting is complex because the port they use is Bandarabas, and since the war is going on, the export procedure has become very slow. So that's the thing with Afghanistan. And about Jordan, some of the ports are not functional because of the war, like Iraq port, Umam Kassar. So all the rice which was earlier going to Umam Kassar is going to Jordan, Agaba port. So, that's where, you know, the export has increased.

Okay, that helps. If I can squeeze in one final question. So, I just wanted to check if the performance that we've shown during Q3 and Q4, can that be sustained throughout this year or if we can, in fact, better that performance, both in terms of top line and bottom line?

See, Manish Ji, the war problem started February end, right? And you can see the quarter. We've exported fairly well. So if during the war we can get such an export, then why not? The next quarters also will be absolutely bright.

I think that's very encouraging. But I also thought this commentary, which came along with the results, wherein we talked about some level of shipments getting impacted, obviously, because of the war. So I guess that will have a spillover to Q1. Would you be able to quantify as to what would be the quantum, maybe in terms of...

I would not like to get into the figures, but what you're saying is true, and that will come in the future.

All right. Thank you so much. Thank you, Manish.

Sir, we'll take the next question from Praveen Sharma. Praveen, you can go ahead.

Hello.

Am I audible? Yes, Praveen Ji.

Yeah. Hello, sir. Hello, Ankit. First of all, IITS, congratulations on the good results. And my only question is from the previous participant, this Alino thing, you know, based on your past experience, when there is a scarce rainfall, then production drops and crop prices increase. What is the effect? Based on past experience, maybe 2019-15.

So Praveen Ji, the paddy will start to come in the month of October-November. So it's very early to comment what is going to happen.

My question was, based on past experience, does it affect the production of... You know, this happened in 2015 and 19, you know, super alnino kind of thing.

So, if you only want to know about the effect, yes, it can affect the crop size. It is true. But there are various factors. This is, of course, one of them. Yes, you're right.

So, in light of that, do we, you know, normally we keep inventory till the season? You know, ends, like September end, uske baad we buy fresh crop. So in such scenario, when obviously you guys, you know, see through the ISRO model, crop kaisa ho raha hai, all those data you get, and you do it very scientifically and beautifully. So in such situation, can we think ki aap usko preempt buying will be, you know, in advance and so that the, when, while the prices are low, you will buy. You know, just thinking out.

Like I said, we are only in the month of May, you know, this question can be better answered in the month of July, August.

My question, where I was coming from is that after this quarter and next quarter, I think we will do very well because we have an inventory which is a low-cost inventory. And given the situation, demand is only going to increase. Rupee will only depreciate. So I think this Q1, Q2 will be fantastic. This is my anticipation. Now going forward in Q3 and Q4, what will it be? I was thinking about it. I was thinking about it.

I'm saying it's too early to comment.

Let's go. So all the best?

I'll tell you one thing. You have the quarter of 2025. You study quarter by quarter. You'll see how the quarter has reduced, how the quarter has increased, where the purchase has increased. We worked very... We worked in the right way, you know, the way it was supposed to be. Like what you were asking, we've been working exactly the way your question was.

No, no, I understand because you guys are being veterans, you know, when the prices were low and people were saying that you bought the inventory and you bought it at the right time at a lower price. And we are seeing the benefit of that right now. And you will see in the future also, yes. Oh, you know, that's very, you know, encouraging to hear. And I think we should move towards next orbit of profitability, although we are doing very well. So let's see. And I hope best. All the best. Good luck. Thank you.

Thank you. Thank you, Praveenji.

Hi, I was asked about the previous question, a new customer has been talking about 40-50,000 tons, and are we talking about 40-50,000 tons? Correct?

Yes, correct.

Okay, sir. And what we are saying is that the rise prices, the movement of the 30% of the international market, the realization of the prices, we are talking about 30% of the price. Is that what the takeaway is? As compared to...

What you said earlier is true. The prices have gone up in international market by 30%.

Okay. And have we also increased our prices to our customers? Because I remember last quarter you said that you had a 10% price hike. So now we have no price hike again?

See, our margins remain same based on the market prices. The markets have gone up. And similarly, we have also adjusted our prices. They're just going away. But in this case, if I'm sitting on a bigger stock, and I'm looking, like sir said, and if I think that prices will get something, then I'll start a little aggressive sale.

I understand. And one thing, sir, last quarter, this quarter, of course, your performance is very good, but in exports, there are volumes of around 4,000 meters per ton. So, how do you take this? I mean, is it like an issue because of the West Asia crisis or anything else that impacts?

Gaurav, sir, you want to comment on 4,000 tons? Gaurav, sir.

Yes, sir. Actually, the volumes are down, that is because of the September quarter, in which the volumes have come down, comparative with the last year, same quarter. Otherwise, you see the export volume has increased from one like 73,000 mt ton to one like 77,000 mt ton from 25 to 26.

Thank you, sir. If you look at the volume of your volume reported in exports, it is 44,500, but in the previous quarter it was 48,900. So is it something seasonal or is it reduced in exports or is it an issue of Q4?

Yes, it is actually decreased by 99%, right? From 48,000. 9% drop. This is due to, you know, some of the shipments that was struck, you know, in between due to Iran or that is why.

Pawan, if you see the press release, they've mentioned that, you know, a few containers which will get executed in Q1.

And now it's resolved, right, sir? Yes, yes, yes. Okay. Thanks, sir. Best of luck. Very good results. Good performance.

Thank you, Pavel.

Thank you, sir. We'll leave the follow-up question from Manish. Manish, you've been good.

Yeah. Ankit, I just wanted to check as to have we made any headway in terms of quick commerce or e-commerce sales? I remember Rajiv, sir, talking in the previous calls that those do not give us much of a margin. So any update on that front?

We have one unit in our Gurgaon office only looking after e-commerce. So, I have met them personally. They are going very strong with all e-commerces. So, yes, Maharani is coming up with e-commerce. If you look up for Maharani on Blinket or Amazon in Gurgaon or nearby NCR, you will get it.

So, am I correct in assuming that our volumes would have definitely increased when you compare it with the previous quarter last year? The e-commerce sales?

Yes. If you're comparing only e-commerce sales, I'm sure the sales are going up. Okay.

And is there any plan to kind of take it to a pan-India level? Because currently you said you're doing it mostly in Gurgaon and surrounding...

Yes, Manish, we are expanding our territories. Absolutely, yes.

All right. Thank you so much.

Anybody wishes to ask a question, please use the option of raise hand. Sir, since there are no further questions, you would like to give any closing comments?

My closing comments would be that this year has been really great. We've done good profitability, and continuously in the future also you're going to see similar quarters with similar profitabilities.

Okay. Thank you to the management team for your valuable time and thank you to all the participants for joining on the call. This brings us to the end of today's conference call. You all may describe now. Thank you.

Thank you, everyone.