Dynamic Cables Limited (DYCL) Q3 2026 Earnings Call Transcript

Ladies and gentlemen, good day and welcome to Dynamic Cable's Q3 and FY26 earning conference call. As a reminder, all participants' lines will be in the lesson-only mode and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing star then zero on your touchstone phone. Please note that this conference is being recorded. I now hand the conference over to Ms. Natasha. Thank you, and over to you, ma'am.

Thank you, Gina, and good afternoon, everyone. On behalf of Philip Capital, I welcome all of you to the third quarter earnings conference call of Dynamics Hables Limited. From the management, we have Mr. Ashish Mangal, Managing Director, Mr. Murari Lal Poddar, Chief Financial Officer, and Mr. Govind Sabu, IR Advisor. I request the team to give their opening remarks, post which we shall open the floor for Q&A. Thank you and over to you, sir.

Hello, good afternoon, everyone. I, Ashish Mangal, Managing Director of Dynamic Abel, extend a warm welcome to all of you to our earnings call. I am pleased to report a strong and consistent performance for the quarter, Q3, with the company delivering a private revenue and profitability for the period. This outcome reflects disciplined execution, strong governance standards, and sustains Good in order book demonstrates the continued trust and confidence of our customers, enforcing our strong market push. Our emphasis on quality has also translated into meaningful milestones with our company securing prestigious certifications such as UL, UGCL approval, and NHL accreditation to our laboratory. I am also pleased to share that we have received the requisite AERB setting up approval for a new upcoming evening facility, a three-milestone in our capacity expansion roadmap. The new plant is progressing as planned and is expected to be commissioned by the end of FY26. Additionally, we have started planning for topics. The details of the same will be shared as and when the finalized by the board. Looking ahead, we remain optimistic about long-term opportunities in India's power infrastructure sector, supported by strong tailwinds from renewable energy, rural electrification, underground cabling, and the transition to higher voltage networks. With a healthy order book and a strong execution framework, We are confident of sustaining our growth momentum and creating long-term value to all stakeholders. With that, I now invite our CFO, Mr. Kodar, to share the financial highlights for this quarter.

Thank you. Good afternoon, everyone. We are pleased to report another strong performance, achieving our highest ever nine-month revenue and profitability during nine-month sales increased by 21% Y1Y, while operating profit rose by 29% to 92%. Operating margin stood at 10.9%, reflecting improved operating leverage and better product mix. Profit after tax grew by 46%, 2 rupees 60 crore, reflecting the company's sustained emphasis on efficient execution and prudent financial management. Customer-wise contributions in nine months, government sales 13%, private sales 78%, export 9%. Thank you. Thank you, and we are now open for questions.

Is there any problem?

Give a minute. Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on their touchstone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handsets while asking a question. The first question comes from the line of Piyush from Sundaram. Alternates, please go ahead.

Hi, sir. Thank you for the opportunity and congrats for a good set of numbers. So, my first question is, can you help us with what has been the volume growth for this quarter?

Volume growth for 9 months has been 17%.

Answer for this quarter, it could be how much?

This quarter, it would be around 2-3%.

Okay. Okay, so largely the growth is led by the commodity price increase. So, have we passed on the complete increase to the end customers?

Yes. So, in our business, the entire price growth is escalation or descalation. Whatever is the variation in price is passed on to our customers.

Okay.

So, just on this volume growth, can you please help us understand why this has been so weak in third quarter? Because one of the market leaders, he grew almost 40% in volume. This quarter, and even spoke about institutional business growing much faster. So are we seeing a lot of competitive pressure?

It also depends upon, because in cable industry, first of all, exact volume measurement is very, very difficult, so we kind of just measure it by the amount of metal we are using in the cable. However, there are a lot of other components also which are used in the cable, and because each cable is customized. Second point is that... I mean, it's not an Apple-to-Apple comparable business with our competitors because our competitors are more into, they are more channel-driven businesses. Whereas, we are completely B2B business, and therefore, it is not exactly comparable in that term, because a lot of channel up-stocking and de-stocking phenomena takes place with the increase and decrease in commodity prices in our channel business, which is not applicable to us. So, this is one of the key reasons, I think, which should answer your question.

So, I think, sir, even in the institutional business, they've talked about very big growth. That is what we were slightly worried about. So, are we losing market share to them? What's just the concern? Anyway, sir, my next question is on the capacity utilization. Can you help us understand how much was COF this quarter?

So, our capacity utilization is always 75% to 80% in this quarter, as it was in the last quarter also. Okay.

So, sir, just to understand the total capacity which we have, we have talked about 135 crores of capacity per month. So, does this include the new capex of 3540 crores which we are doing, which we get commissioned in fourth quarter?

No, no. So, 135 crores per month does not include the new capex. It is from our existing setup. And secondly, our optimum capacity utilization is around 80 to 85 percent. So, depending upon the cable specification which is under production. And also the seasonality which is there in our business. So Q4 is a bit heavy than the rest of the quarters.

So, ideally, this number should have been an inch higher because your commodity prices have gone up, right?

Commodity prices have gone up. So, but, I mean, commodity prices for us, one thing is that we are into 100%, 95% is aluminium for us commodities. So, there is not much increase in the commodity prices as compared to copper and other commodities, which you must be referring to. And secondly, again I am talking that these are all indicative numbers, because in cable industry it is very very difficult to quantify. The volumes, or the capacity volumes, because the cable is customized. Each and every customization has its own machine time. So, on a machine time basis, it is very, very difficult to quantify the volume, per se.

That's what you wanted to quantify. It is, it can be from year to year, because, yes,

on a year-on-year basis, we give an indicative number that what is the best capacity volume, which we, value which we can do from the plant, And what optimum utilization, as we have already guided in the past, are experiences that it depends on 80 to 85 percent of the driving capacity.

So, I think that's very clear. Thank you for the opportunity, and all the best. Thank you. Thank you.

The next question comes from the line of Nitin Jain from Fair Value Equity Advisory. Please go ahead.

Thank you for the opportunity, and congratulations on a good quarter. So, my first question is on revenue growth. So, if we see a trend of last 6-7 quarters, we are at the slowest revenue growth, around 19%. So, my question is, do we see it accelerating going forward, given that the monsoon factor is well and truly behind us now?

So, absolutely. So, there are a lot of new growth areas which we feel that provide us a good runway for growth in our business. So, if you look at our growth journey in the last three, four quarters, it is primarily driven by power distribution segment, smart metering and other initiatives, all the government schemes. Which comes into play, the vertical expansion of the power distribution network. So all these factors drive the power distribution growth. Second is our renewable initiative, which we started last year. So last year it contributed around 10-15% of our... So, again, this year, I think it will be higher. It will be around 20% of our sales, 15% to 20% of our sales this year. So, gradually, that is inching up. Apart from this, we have announced certain... We have received from power grid, which gives us a good runway or breakthrough into AL59 conductors. Then we have some encouraging developments in STLS conductors. So these are all high-tension lines or the transmission sector where vertical growth is taking place. We have got AERB approval for setting up our e-beam facility. So this opens up a new area for us. On the renewable side, we are venturing into the DC cables. So that is, again, leverage on our existing thing. Unfortunately, our U.S. export plans have not materialized because of this tariff announcement. So, we are getting continuous approvals under the U.S. standards for our products, but the tariff situation is unfavorable, and especially for delaying our entry into the U.S. markets. So, these are a few growth areas, which definitely are going to drive the growth in the future also. To capture this growth opportunity, we are... Doing a greenfield project, which will be completed and will be available from next financial year, as well as new product developments and customer engagements are. So, these are few growth areas which we have been talking about in the last three, four quarters, and as we have guided in the past also for 18 to 20% growth, and we have a track record of this 18 to 20% growth for last. In the last seven, eight years, we believe that we should continue to compound our growth, our business at this rate in the long run.

Great, sir. That is quite helpful. Thank you on the clarification. So on the order book status, we see an improvement quarter on quarter. But what I wanted to know is last quarter you mentioned that order winds had slowed down because of the extended monsoon. Do we see order winds also accelerating now, especially in the month of January?

So, order wins are basically, I mean, it's a continuous phenomenon, and it does, keeps on happening, I mean, it's a regular process for our business. The incremental order wins is a test, I mean, the increased order book is a testimony of increased order wins in the last quarter, post the... Monsoon season and festival season getting over. We believe that this acceleration should continue going forward. That is what our sense is from the market.

So, on the gross margins, there is a significant improvement here and here, but quarter on quarter there is a dip. So, is it that we have not been able to pass all of the impact of metal prices? Is it that part of it we have absorbed or is there something else here?

So, gross margin has nothing to do with input prices or raw material prices in our business because 100% of our price variation or the raw material price fluctuation is passed on to our customers. Yes, yes, yes. So, 100%, 100% on a real-time basis. That is quite established practice in our business, which is an institutional business, a B2B business, not only for us but for everyone in our business. It is only in the channel sales where there is a lag in passing on or there is some elbow room in this kind of business. For us, it is a complete pass-through. The margins are, I mean, it is largely driven by the sales mix, and in some quarters, there may be some high margin orders getting executed, in some quarters, there will be some low margin orders getting executed. So that creates a quarterly fluctuation. But on a longer term, if you look at it, it's, we have, I mean, it's around 80% gross margin, 20% gross margin.

Okay. Sir, also, would you be able to provide any status update on two categories, data center and wind products, wind-related products?

So, I mean, we are more active in the solar side, not on the wind side as such. So, on the solar side, we are already supplying AC cables, and the order book composition of solar cables is also quite encouraging. So it had the share of... Over a period of time, and that is also reflected in our order book. More than 15% of our business contribution comes from the solar cable and on the order book side also it reflects the same. Around 16-17% of our order book is comprising of solar. Currently, we are just supplying AC cables to all these solar plants. However, with the new facility coming up or the new plant coming up, we will also be equipped to sail. DC cable, so that should, again, increase or further penetrate, improve our penetration on the solar side, on the solar cable side. On the data sensor-wise, I think the industry as such is also in a very niche stage, and it is very, very difficult to kind of provide an update on a quarterly basis, but definitely our eyes and our product development team are closely working with Some of the customers in this segment and trying to develop suitable products for data centers. As and when there is any substantial achievement or breakthrough, we will kind of update you.

Okay, great. So, no, I'm asking this because I think last quarter or the quarter before that, you had mentioned that we were working on wind-related products. So, just I'll be looking for a status update on that. But that's okay. Maybe we can talk about it after the annual update. So, my last question is the sum of employee and other expenses. Over a period of time, they have reached up from around 8% to 9%. Although we are able to improve our EBITDA margin, how do we see the trend on these expenses? Thank you.

I mean, we have always said that we are typically a 80-10-10 business. So 80% is the material cost, 10% is our employee and other expenses, and 10% is our EBITDA margin. And 1% variation error there keeps on happening on these fronts. So this is largely a business construct. And it has been the long-term construct for us. And I think that no material changes we can think of in this construct.

Thank you, sir. That's very helpful, and all the best.

Thank you. The next question comes from the line of Balasubramaniam from Ariane Capital. Please go ahead.

Good afternoon, sir. Thank you so much for the opportunity. Sir, the order book side, like how the demand is coming. I think order book remaining, like we have not seen much improvement. Last quarter, 721 crore. Right now, 787 crore. How this order book pipeline is coming? And last time, some inventory were stuck at both the side, CCLA and the customer side. How did I dispatch normalizing to Q4?

I think your voice is not clear. So, I think the second part of the question, I could not understand. On the order book, growth, I think, was the primary question, which you were kind of asking us. So basically...

Yes, sir, please go ahead.

Book quarter, the order book has been encouraging, so it's a 10% growth on a quarterly basis, which is quite encouraging. Growth pattern, you will see a similar trend. So, I mean, three years back, we were at 450 crores, 500 crores kind of range. Then we improved to 600, 700 crores range. Now we are into 700 to 800 crores range. So this is how the trajectory is, and this is how we have been growing our business.

Sir, actually, last quarter, some inventory were stuck with DCL and its customers. How are the dispatches terminating in Q4?

Dispatches have started picking up in Q4 because there is a lot of government project-related business. It is heavier or has a seasonality effect in the Q4. And that is evident for our business folks.

Okay, sir. Sir, on that, I think our new plan will be operational by end of this financial year. I think we are adding DC cables majorly in this facility. I think we also have existing alternate cable offerings. How this wallet share will, like, change after introduction of DC cables, and how is this typical ratio of DC to alternate cable demand from your solar EPP customers?

I mean, the wallet share definitely is going to increase. It depends upon customer to customer, so it is not a standard answer which we can provide you, and the ratio also kind of depends on project to project. So again, it is a standard answer to it, and maybe the front owners of the EPC players are more equipped to kind of provide you a better... A better understanding of the ratio of, on these ratios, I believe, because we are cable suppliers and we kind of work on the orders which we receive from our customers and the specifications which we receive from our customers.

Okay, sir. Sir, I think you already explained about the data centers, and I need to understand about the battery energy storage system side, and like how do you understand on cable requirements for battery energy storage side, and what is the market sizing, and what is your focus area for the product development side?

Sir, very difficult on the tech side because it is a very, very...

Sorry to interrupt, sir. There is some disturbance. I just, from your end, can you just keep yourself a little bit at distance from the mic? Yes, sir, you can proceed now.

Yes. So, on the best side, I think it's too early kind of to comment because as such, the industry has just started, and moreover, most of the components are imported in India as of today. So, very, very too early, I mean, very, very early to kind of comment anything on the best from the cable supply perspective. On data centers, we have already given our commentary, so I think that should suffice.

Thank you.

Thank you. The next question comes from the line of Raman Keevy from Sikpen Investment. Please go ahead.

Hello, sir. Sir, I just want to understand, you said the margin improvement is mainly attributed to your product. What in the product like HV or LV or connectors drove this margin improvement? One is that, and second is your greenfield capex of, I think, 35 peros will provide as an incremental revenue of around 300, 250, 300 peros going by your current asset turn. So, now you are currently operating at 80% capacity utilization. Going forward, what's the CapEx plan you have for, let's say, next two years or three years? Because this 35% greenfield project will be completely, if my understanding is right, will be exhausted by probably FI27

end or first half of FI28.

So, that's why I just want to understand your growth plans from the company's prospects. Thank you, sir.

So, basically, it was a heavy quarter for us, just to give you a color on the sales mix side. So, one is this. Second is that, you are correct, our capex, this current capex will be over by... In this financial year, and maybe for the new financial years, we will have to go for additional capex. And so largely, if we are able to do the asset terms, if you have calculated it correctly, the only caveat is that the optimum capacity utilization in our cable business is 80 to 85 percent. So, the peak capacity, you have calculated it correctly, but I think we will have to give a factor of cable customization or the order customization as well as the seasonality which is there in our business. So, that kind of gives us an optimum capacity utilization of around 80-85% in our business. So, this is one factor which I just wanted to point out. The second point is that regarding the CAPEX plan, we have not crystallized the CAPEX plan, but just to give you a, I mean, we would be sharing our CAPEX plan probably once this CAPEX is over and the new CAPEX is decided. But if we have to grow at 18-20% and the asset terms remain largely same, you can kind of do a back-of-envelope calculation of how much CAPEX we would be doing for next, or our CAPEX budget which we need to provide for in next three years.

So, just a follow-up on my question. With respect to the margin, can you just provide some highlights like whether during the quarter the product mix was more... I just want to understand where the margin improvement came from. Whether it was from high voltage cables or low voltage cables. In terms of product mix, which improved during the quarter. I just want to say that.

There were some high margin orders which were executed and dispatched during the quarter. And we maintain that our, I mean, in the cable business, the normalized margin on a yearly basis, on a long-term yearly basis, will remain in 10, 10.5, 11% range. So that is the range which we have been talking about in a B2B cable business. And we still maintain that this range will be at that for going forward also.

And sir, our entire sale is B2B, right?

Yes, our entire sale is B2B.

Sir, amongst the B2B, how much is like export, how much is domestic and domestic if you can provide the spread between institution and government?

Export is a 8 to 10% kind of business for us and balance 90% is domestic business. Government business is around less than, now it has reduced to around 12-13%.

And the remaining is the institutional?

Private. Sorry? The remaining is the institutional? Private. I mean, institutional, of course, but it's a B2B business. So we supply to this comms also, as well as we supply to EPC contractors also.

Thank you, sir.

Thank you. The next question comes from the line of Namish Gupta from NGC. Please go ahead.

Hello.

Yes, sir. You are audible. Please go ahead.

Yeah. Hi, sir. Thanks for giving the chance and congratulations on a good set of numbers. Sir, my question is like. From March 23 till now, I mean, we were like till March 25, we were growing at a very rapid price in terms of like order book. In March 23, our order book was like something around 330 crores. But since March 25, it kind of is like I stuck in from 730 to 780 crores. So are we seeing I mean, I mean, are we holding the orders or will this order book also, I mean, accelerate as we, as our new CAPEX starts?

Yes, so, you are absolutely correct. So, the order book is also a function of our capacity to deliver. So, we can't take more, I mean, the order book has to be in line with our deliverable capacity. So, as our capacity utilization has gone up from March 23 to March 26 or 26, And so we have to kind of balance and calibrate our order book based on our deliverable capacity because our machine time is limited. Although we have done some de-bottlenecking and some brownfield capex during March 23 to March 26, that has enabled us to increase our order book from 400 crores to 800 crores.

So, like, like, your, abhi, sir, abhi, hummara, like, March 26th mein capex complete ho jayega. So, hum, kya, hum, like, isco, March 26th, ya, fir, June 26th tuk, hum, hiya mahan sakti hai ki, yehi order book hummari 1000 crore, ya, uske aaspa s hojja ho jayegi, sir?

So, kooshis toho hai, jadha se jadha order badaane ki, jitna humare paas mein capacity unlock hoota hai, usko, ful, fill, fill, kertte rehen, jaldi se jaldi. So, that is what is our, Uh, endeavor, best endeavor in the business.

Okay. Uh, sir, I have one more question. I mean, are gross margins, which I have seen, like, in the last two years, it has increased, like, from 18% to 20%. So, there is a 2% jump, and this is very, like, this is, I mean, this increment in margin is going on every, every quarter. Not like it is not like a one time jump. So as of now, our gross margins is more than like 20%. So like first, what is actually the reason of this increase in 2% gross margin in last two and two and two and a half years? And will this margin be sustainable in future also?

It's not like that. If you enjoy long-term history, gross margin has been higher than FY25 in FY19 and FY20. So, our gross margin is up to 22%. So, it all depends. Keep on the situation. As I said before, the entire construct of the business is a 80% gross margin business as a long-term average. So, it's up to 81% or it's up to 81% depending upon the revenue mix. There are specific orders being executed during that quarter. So a quarter to quarter fluctuation is very important. But our basic construct is a AT-1010 business.

Okay, okay. And sir, just one last question, sir. I mean, although you have told me that the volume you can calculate in this business, but still, it's about 2-3% of the volume. Sir, what was the broad reason behind the volume? Thank you. We have seen around 19% of sales growth. Is it the whole pricing led or the mix of the products, higher realization of the products? Is it just like that, sir? What is it?

There are many things inside this product. When we measure the volume and indicate the volume, then we give it to the metal volume. There are a lot of other components which go in cable making. Metal is just 60-70% of the total cable cost. Balance 30-40% is other cost also. So during this quarter, this quarter under our conductor business, which is a pure metal business, that contribution was very less. It was less than 5%. So, quarter on quarter, volume growth and volume comparison is very difficult, whereas, if I say, Other components or customization, it keeps on varying. It's very difficult. 9-month average, it's a 17% kind of volume growth for us during the 9-month. That is a better number to look at from the management perspective.

Sir, just a clarification in this only. The 2-3% volume growth was quarter on quarter. Sir, or why-oh-why?

Thank you. The next question comes from the line of Mayhul from 40 Cent. Please go ahead.

Hello, sir. Thank you so much for the opportunity.

Sir, this is what we are doing in our capex, which will be in the next financial year. So, how much will it increase the top line?

Sir, our asset terms are typically six times. Six times are gross block. So we are doing a capex of around 40-45 crores, which should give us typically unlock additional turnover of around 250 crores to whatever. Six times, if you do it, then 250-250 crores.

Sir, that is the annual turnover, right, 250 crores?

Yes, yes, yes, absolutely.

Incremental 250 crores, okay. And, sir, one question around competition. So, since we are in the B2B business, what kind of competition do we have, you know,

how much is the market share in the B2B segment? Thank you.

Mayhul, there is a lot of background noise from your end.

Okay, I'm mute. I'm on mute.

Yeah, so what I was saying was that industry sizing to such breakup is very, very difficult to kind of get from a reliable source. The total overall wire and cable industry is estimated to be around 80,000 crores. We believe that around 50% of... 45 to 50% of the entire B2B should be the B2B business segment, which we are into. So, if we do this math, this is again all estimated number. The B2B industry sizing should be around 35,000-40,000 close, and we are doing around 3-4% market share of this B2B business, or the other B2B market.

Thank you so much, sir. All the best.

Thank you. The next question comes from the line of Ankur Kumar from Alpha Capital. Please go ahead. Mr. Ankur, kindly proceed with your question.

Hello, sir. Thank you for taking my question. Sir, I wanted to ask on this demand side, we have seen growth in order book. Can you talk whether demand is set to improve or maybe is it reducing because some of the power cap is getting delayed? So, can you talk on that front, please?

So, demand is, I mean, increase in order book reflects increase in demand.

Sir, is it like the private side which is helping in the Pepex increase?

Yes. So, we are, I mean, we are focused more on private business. So, that is our focus area, and that is driving the growth for us.

Okay, sir. Answer on the guidance side. Do you expect a 20-25% growth or like we are guiding only 18-20% for this year and the next year?

We don't give any guidance as such, but what we are saying is that in last, I mean, if you look at our track record, we have been growing at 18-20% on a long-term growth trajectory, and that is how our business and our company's DNA is tuned to achieve.

Thank you.

The next question comes from the line of questions from Inved Research. Please go ahead.

Hi, thanks for taking my question. Sir, in past few concours, we have discussed that we want to grow at 1.5 times the industry growth rate. So, since this time around, you know, our volume growth. Sorry, our volume growth has remained subdued. So, is it fair to assume that the industry growth was missing in this quarter in terms of volume growth? That is my first question.

It's very difficult to kind of quantify the industry growth size and all those things on a quarterly basis. And secondly, as I told you that volume growth, again, is not a number. It depends upon the product specification. So, as I told you that our conductor ratio in the contribution, the sales mix was much lower in this quarter, which led to a lower volume growth for us in this particular quarter. But in a long term, we maintain that industry growth would be around 12-13% and we would be growing at 18-20%. So that is what has been our overall philosophy or growth philosophy, growth ideology in our company.

Okay, okay. Sir, can you also tell me the change in conductor sales as a percentage of top line this quarter versus 10 quarter last year?

This quarter, it was 4.5%, and last quarter, last year, would be around 9%.

Got it, got it. So due to this 5% change, let's say, our volume growth actually came down significantly from the previous quarter. Is that what you are indicating? Okay, got it. Thank you.

There is no other element. It is only metal, and we are just comparing metal. I mean, this volume growth is just the metal which we have used or consumed during the quarter. That's how we can measure.

Okay, okay. Understood. I think it's better to look at yearly numbers other than looking at quarterly numbers. Thank you.

Thank you. The next question comes from the line of Aryan from Manish J and Associates. Please go ahead.

Hello, sir. Thank you for giving me this opportunity. My question was relating that in earlier concourse, Amazon was talking about the increase in revenue from railway signaling cables, and if yes, the revenue has increased, then how much percentage of revenue has increased from this segment?

Railway signaling, I mean, since last three, four quarters, we have been explaining that the business scenario of the competitive intensity in railway signaling business is not favorable, and we are not focused on railway signaling because the margin profile is much better in the distribution business, in the solar renewable sector.

My second question is that as there is too much supply of solar power in India, but transmission and distribution of power is still facing a huge gap. So how are you looking to utilize this opportunity to capture the gap as already there are big players in the competition?

So that this gap is where the cables are used.

Yeah.

And now we are also supplying cables to fill this gap.

Okay. So, any strategy to compete with the big players?

We are competing. So, if you look at our solar cable business, it is one of the fastest growing segments for our company. Last year, the sales proportion was around 10 to 15%, which will increase to 15 to 20% this year. So this is, there is a huge, I mean, we can say that we have been successfully established ourselves in this business category.

Okay. And my last question is that I just want to take update on the vendor registration of the data center. What is the update?

Things are going on. And as I told you that it is very, very difficult to kind of give a quarterly update on this. So, it remains the same. The product development team and the customer registration team, both are working in tandem with the relevant players in the industry, and we hope that we are able to do a meaningful breakthrough in this segment as the segment matures, because the end-user segment has to mature for us to supply cables.

Okay, so thank you. All the best.

Thank you.

Thank you. The next question comes from the line of Nitin Jain from Fair Value. Equity advisory, please go ahead.

Yeah, thank you for the follow-up opportunity. Sir, as we have seen, the contribution of solar products is gradually rising. And assuming our new CAPEX goes live by FR-26 and as we are projecting, and you know, we start, we go live with data center products. Can we see any meaningful improvement in margins as well?

In the B2B business, it is the, I mean, again, I am reiterating the same thing. The long-term sustainable margins will be... Between 10 to 11%. So that is a range which we can kind of assume for a B2B player. And this is the range which will come back. I mean, there may be some quarterly fluctuations here and there, but on a long term, on a yearly basis, this would revert to this range. Because it's a competitive business. In a B2B competition, you have to compete on the lowest size business.

Right. And on the U.S. product launch end, if the tariff-related situation, assuming that it gets even partially resolved from 50% to 25%, you know, given both countries have made some statements regarding the Russian oil, we are not buying anymore. So even if it comes down partially from 50% to 25%, will our U.S. exports become viable in that scenario? Will we start exporting in that situation?

Thank you. It becomes encouraging for us to kind of explore the U.S. market once the tariff comes down. So there is no chance for us to enter that market.

Right. No, I'm asking in the scenario that even if there is a partial resolution.

It also depends upon how the tariffs are negotiated with other countries, because we have to compete with the other countries as well. So there is a lot of volatility in that situation, and a standalone answer is very, very difficult to answer on a standalone basis. I mean, we are on our job, so we are getting the approvals done, we are getting, we have already started, we had started doing the sales roadshows for our products in the U.S., but unfortunately, the tariff situation has become unfavorable, and once it, if it, If it comes to our favor, definitely we would be able to get a breakthrough in the new market.

Got it. And so, one last question. As a percentage of overall business, what is the game plan to, you know, where do you want to take the solar business, the solar product business?

I don't know. I mean, it's a huge opportunity for a company like of our size because we are just, even if we do 20%, we would be supplying 200 to 50 crores of solar cables, whereas the market is… Around 6-7,000 crores, or 5,000 crores upwards, let me put it that way. So, we have a huge runway to increase our presence in this market. So, yes, I believe that in the next 3-4 years, we should be in a situation to develop this business at least.

Got it. Got it. That's very helpful. Thank you so much, and all the best. Thank you.

Thank you. Ladies and gentlemen, we will take the last question from Aryan, from Manish J. Munda and Associates. Please go ahead. Hello, sir, you are audible, please proceed with your question. Yes, sir, you are audible to us. Please proceed. Yes, sir. The line for Mr. Aryan has been disconnected. Okay. Ladies and gentlemen, I would now like to hand the conference over to Ms. Natasha for closing comments.

Thank you, Hina. Requesting management to give any closing remarks?

No, thank you, sir. Thank you, everyone. And thank you all the investors and key stakeholders to be a part in showing faith in us. And we'll try to give more and better results in the coming years. Thank you.

Thank you. That concludes the conference. Participants may disconnect their lines.

Thank you. On behalf of Philippe Capital Private Limited, that concludes this conference. Thank you for joining us and you may not disconnect your lines.