Knack Packaging Limited (KNACK) Q1 2027 Earnings Call Transcript

Ladies and gentlemen, good day and welcome to NAT Packaging Limited Earnings Conference Call, Q1-F527. 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 the conference call, please signal an operator by pressing star and zero on your touchstone phone. Please note that this conference is being recorded. Before we get started, I would like to point out that some statements made or discussed on today's call may be forward-looking in nature and must be viewed in conjunction with the risks and uncertainties that we face. The company does not undertake to update these forward-looking statements publicly. I now hand the contents over to Mr. Alpej Sulcibhai Patel, Chairman and Managing Director from NAC Packaging. Thank you and over to you, Mr. Patel. Thank you.

Good afternoon to everyone. It gives me immense pleasure to welcome all our stakeholders, analysts, investors, and members of the investment community to NAC Packaging Limited's first-ever earnings conference call following our successful listing on the National Stock Exchange and the BNC. On behalf of the Board of Directors and the entire NAC packaging family, I sincerely thank each one of you for the confidence and the trust you have placed in our company. Listing on the Indian capital market is an important milestone in our journey. While it is a significant achievement, we view it not as a destination, but as the beginning of the much larger journey. Since this is our first earnings call, I would like to spend a few minutes introducing our business and sharing what makes NAC Packaging a differentiated company. NAC Packaging is one of the leading, integrated, innovation-oriented, export-led, and We are a sustainable-oriented packaging solution provider, offering a diverse range of packaging solutions, including printed and laminated booban polypropylene bags named as PLWPP and PLWPP pinch bottom bags that are customized high-strength packaging solutions for a wide range of sectors, including food products and pet food. As an early mover in the industry, we have built over 30 years of experience and to Today stands as one of the industry's leading players across the globe. Our solutions enhance brand visibility on packaging, reduce the risk of counter-forfeiting, and improve the operational performance. We offer a comprehensive portfolio of bulk packaging solutions developed over more than three decades through continuous technological innovation and deep industry expertise. Our value proposition extends beyond core packaging products to include a wide range of customized add-on solutions such as circular and back-stream construction, half-full and registered windows. Thank you. Differentiation was not built overnight. Since in 2004, we identified a gap in the market. While brands invested heavily in the look and feel for small retail packs, there was a very limited scope to present a brand identity on bulk industrial packaging from 5kg to 50kg packaging. We spend close to two years on R&D and become the first company in India to introduce typical printed bags that carry the same branding up to 50 kg bulk bags as on smaller consumer bags. This great start has translated into a genuine first-mover advantage. Due to our expertise, today, we serve leading companies from industries such as rice, dal, lentils, flour and spices, sugar, salt, fruit and nuts, animal and pet feed, agriculture, seeds, charcoal, detergent powder and renewals, fertilizer, chemical. Thank you. Thank you. We are currently operating at more than 48,000 metric ton per annum capacity, including rented facilities and translating into an approximately 91% capacity utilization. This reflects healthy utilization level for our operations and demonstrates efficient use of our manufacturing capacity while providing a strong foundation to support future growth. Innovation is one of our strengths. We cater to the companies who are willing to invest in brand, in packaging as a strategic differentiator. We continue to invest in new product development and leverage our first-mover advantage across multiple product categories. Strong and deep customer relationship is reflected in our customer retention ratio, which is as high as 90%, 9-0. This is not an existential. It is built over a four key pillar that define our approach to customer service, quality, commitment, responsiveness, and transparency. We are committed to deliver high-quality products, ensuring on-time deliveries, and responding promptly to customers' requirements and queries. Through our digital portal named NAC Galaxy, customers have easy access to product information, order-related updates, and other relevant details, enabling greater transparency, seamless communication. Together, this pillar has helped us build long-term customer relationship consistently on that trust. Because our packaging incorporates proprietary color formulations and SOPs that we do not disclose any deviation in quality when a brand-changed packaging vendor can be immediately visible to the end consumer and may adversely affect brand perception and reputation. Importantly, packaging typically represents less than 1% to 2% of our customers' end product price, making it relatively small investment compared with the significant role it plays in product presentation, shelf appeal, and consumer perception. Packaging is often a physical touchpoint between brand and the consumer and can materially influence purchase decision, particularly in high competitive categories. Consequently, customers have a strong incentive to maintain consistent packaging quality once a packaging supplier has demonstrated reliability, consistency, and understanding of the brand's requirements. We are present in both domestic and international market, with our international footprint continuing to export steadily. As of quarter 1 fiscal year 2027, NAC packaging has established a present. This is from 71 countries in fiscal year 2026. Thank you. This resilient supply chain is a key competitive advantage. We have a strong in-house logistic capability that has been built over the years and it gives our customers the confidence that we remain a dependable partner. Thank you. The upcoming manufacturing facility will future strengthen our long term capacity, but it will not slow down our growth in the interim. Until the new plan becomes operational, we will leverage rented facility for semi-furnished goods production, while the value added processing will remain at our existing manufacturing facility. This asset-like approach allows us to continue scaling. The recently released facilities provides us the necessary infrastructure while the operations are being managed by our own trained workforce. This team will eventually transition into new plant once it is commissioned, ensuring seamless ramp-up of operations with an experienced workforce already in place. With these steps, we remain committed to Expanding our portfolio, strengthening our market position, and sustaining our growth momentum. Before I conclude, I would like to thank all our customers, suppliers, bankers, Our shareholders for their continued trust and support since our listing. We remain focused on building a business that delivers sustainable, innovation-led growth while creating long-term value for our stakeholders. And we look forward to a long and transparent relationship with investment community. At last, I would like to assure everyone that NAC packaging will continue. With that, I would now like to invite our Chief Financial Officer, Dr. Ajay Kumar Dubey, to walk you through the detailed financial performance for the first quarter of fiscal 2025.

Thank you, LK Zai. Good afternoon, everyone. I will take you through the financial performance of Quarter 1, Financial Air 20 table, and highlighted the key operational and financial drivers. Our consolidated revenue for quarter 1 financial year 27 stood at Rs.2647.71 million compared to Rs.1871.71 million in quarter 1 financial year 26, registering a year-on-year growth of 40.50%. The strong growth during the quarter was driven by higher sale volume. Capacity utilization and continued ramp-up of recently commissioned capacity. 20.90%. Thank you. Thank you. Thank you. Improvement in the EBITDA and margin was. Coming to the bottom line, our consolidated profit after tax for the quarter one financial year 27 is 2.305. We will get 26. Registering year-on-year growth up to approximately 47.96%, our FAT margin improved to The improvement in profitability is also reflected to our return ratio. Some key our ratio financial year 27 versus quarter one financial year 26. Thank you. The call was from 37.04% to 37.45%. Overall quarter 1, financial rate 27 was a strong quarter for the company. Ramping a power. While continue to efficiency manage raw material priceability. Thank you very much for our question and answers to them.

Thank you. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and 1 on your touchstone telephone. 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 the question queue assembles. The first question comes on the line of Raman KB with frequent investments. Please go ahead.

Hello, sir. Thank you for allowing me to ask the question and congratulations on what set of numbers. I just have two questions. One is with respect to ROCE. I just want to understand why is our company's ROCE so high? Also on the asset turn model, the company's asset turn is, when we compare it to peers, is very high. So can you explain that matrix?

Basically, sir, we are incurring continuous profit-based margin, and today, due to this capital market, whatever, we have proceeds received from 320 crore, which will be incurred in our coming products, coming this plant. So, basis on that, margin is good and our net worth is good. So, basis on continuous improving the return on capital employed. And similarly, improving of return on equity has been.

Sir, myself, I would add a point on this question. Sir, we are like a textile packaging company. So, we have always two types of machinery, set up machinery. One is like a textile kind of thing. First, we produce the tape and then weaving. So, it is purely plastic technical textile specialized fabric. So, for that we have to invest a lot of money on that area, and then after making the pinch bottom bag, like a specialized bag, so on that area we also have a very huge European machinery. So, for that we have invested a lot of things. Thank you.

Pairing with the industry peer, on an average, asset turn is 1.5, and if it's a good quarter, it's around 2. Ours is around 4 to 5x. I just want to understand why there is a superior asset quality, and we are able to still, despite doing that, we are able to maintain 20% margin, which is like industry-leading margins. So, is this because we have a red drip facility or something else going on?

Sir, basically in effect on if you are calculating, that is basically two way. One, if you are calculating based on the gross block, that is almost 1.98 in previous and 2.53% as current 30th, that is June 2026. If you are comparing from the net block, that would be around 4.12 asset turn. So, asset turn, if you are comparing gross block, that is 2.53, and net block, so 4.12. That is the asset turn.

Yes, sir, that's what I am telling. The industry average is around 1.52x. Ours is, on a net block, is around 4 to 5x. So, I just want to understand what are we doing so different from the industry that our asset turn is so high.

So, basically, we are, we, we are just, just, always, we have confirmed that there is two types of machinery. One, we are incurring for the manufacturing of our fabric, another for the finishing parts. So, finishing part material, machine would, just, more probability that would generated from. More profit compared to other. So we are pinched bottom basically our premium product and pinched bottom machine we have already installed. So that's why our asset turn is improving day by day.

And one more thing most important, sir, to be very honest, there is a most genuine PR compared to Mac. Like they are into the packaging. Packaging has a wide range of the packaging materials. But this is we are specialized packaging materials. So, this is the kind of printed, laminated, polywoven bag. So, it is a required different kind of set of machineries and different kind of product and everything. So, like this is the, yes, like a 2.3, 2.1, and other company, 2.1 or something, and other company, gross block is a 2.53. That is a 4.52 is from the net block. So, if we compare it to gross block, so it is a 2.50 kind of thing.

Understood. Thank you for that. My second question is on the raw material side, the prices of our raw material, which is basically polypropylene, has risen significantly since the war. So how is our impact? How are we dealing with that? And what's the usual timeline to pass the raw material prices to the customer and end users? So can you explain on that aspect as well?

Yes, sir. First, I have a request for the previous question. For which years we are comparing to this asset turnover? So please, if you have any details, then we will give you more detail on this point. And secondly, for the pricing, polymers and crude price, yes, it is a 100% valentine right now. There is a lot of things are going on. But we have a very good, first of all, we have a 30-year experience. So we have a, first of all, we have a working on SAP as for HANA. Company is very much transparent and very long vision company. So we have a very good forecasting system. Thank you. We have a very good forecast internally. Secondly, India has a very good refinery. India has a lot of refineries, many refineries, and we have a 30-year experience with them. So we never felt any kind of this kind of problem. And due to that, as a figure, you can see our net margin like a 47% increment of this year. Same to some EBITDA, like a 53% increment. Revenue will be increased 41% compared to last year, previous year. Part of one financial to this financial part of one. So, we have very good hold. I can say we have very good purchase team, planning, team members, local purpose, local refinery, and 30-year access. All together, we will get a good relationship on this, and we can get the advantage of shopping. Even we can get the note discount as well with our supplier. So, for how? For that, we are managing this raw material. I'll be here. And we always buy the cash so we also get the good discount on it. Bulk buying also we are referring. So on that area we will get. And the same way we transfer the price to customer because this is a total deserve price nowadays. So every our customer knows very well. The screw price goes up, so polymer price goes up and your bag cost goes up. So they are very easily to funding to increase the price. So this is the system is already set. So not much more difficult to get the good price from the customer, then nobody can easily increase the price, price increase. Decrease the price, and then we decrease the price.

Thank you. Mr. Raman, please reach out to the queue for more questions. The next question comes from the line of Dhananjay Bakarodhya with Alchemy. Please provide.

Hello. Yes, Dhananjay. Yes, sir. Congratulations on a fantastic set of results. And congratulations on the IPO too. So I just wanted to ask you a few questions. Basically, where crude is going up and a lot of your input costs are going up and tariffs going up, how are we able to keep our margins steady? Are we passing on to customers or efficiency just to understand?

Sir, I would like to give you an answer on this. We have a very long-term contractual customer, like Cargill is one of them. We are working with Cargill into like eight countries and our total sales revenue comes from like six to seventy percent comes from the Cargill. So we have a conversion. Like a basic price plus conversion. So basic price is the romantic price plus conversion cost system. So almost company, 45 to 50% customer are one of the conversion basis customers. Like Cargain India, Bhavath, Poynuto, big brand. They all are our customer, and they have a fix up with the conversion cost. So price go up. We remain above margin or our conversion costs remain paid. And another thing, other 50%, 35%, 50% customer is like a very small player, like Tamil Nadu, Karakuri, there is a small rice meal or fertilizer company. So they enter the packaging cost, there is only below one person costing of the packaging cost of our product. So they are not much bother about that cost. And then, honestly, we are also very transparent with that kind of customer. But there is a very low quantity, like 25,000, 50,000 bags a month. So they order at the time, other time, the price, the raw material price, we convert and fix the price, and we make the bag and transfer the same price to that. So both the way, we will get the good conversion and the remaining conversion, we will manage it. And now, we are adding our new product, like a pinch-button product, so it is a high-value-added product, and very huge plant, and very... What the packaging of rice, feed, materialize, or anything, and they will get the good branding out of it. Like stitcher bag, there is only four type branding, but the pinch bottom, they will get the six type branding. So, always they prefer pinch cap, pinch bottom bag, and that is the very good margin product for the company. So, that's also increasing in the company. Last quarter, we installed two machines, so we get the good revenue from that area as well.

Okay. So, sir, let's assume, let's say six months in your hands, if commodity prices were to, input prices were to reduce, would we pass on that benefit again to customers or would we keep that input, would we keep that margin with us?

It's both the way we are working on it. Sometimes it depends on the situation, and sometimes we have a 50% pass-off, and 60% we will get it as it is, sir.

Okay, fine. Wow. So, thank you so much. Super result. Thank you. Thank you, sir. Thank you, Dananeer.

Thank you.

Thank you. Next question comes from the line of Amir of Jemudia with Annual Wealth East West.

Yes, sir. Good afternoon. A few questions to ask. Sir, when I see our volumes in FY24, I think they were close to around 30,000 tons, and FY26 was around 38,000 tons. So, when I compare the realization, it were almost same, but our EBITDA per kg jumped from 33 to 45, and I think in Q1, we are already at 54 rupees a kg. So, if you can just give broad-based break-up in terms of our PLWPP bags and pinch bags, what were they in terms of volumes in FY24 and FY26, that would be helpful.

Yes, yes, Niro, right. I think we are already aware we have a good range of the product like pinch bottom back. So just in the last quarter we introduced two machines for the PLWPP plus pinch bottom back. So that is a good margin on PLWPP plus pinch bottom back. Even the solar, we already installed rooftop solar windmill, and last to last quarter, we started the solar farm, 11 megawatt solar farm at the Cape Brahma. So, in the previous data, you can check there is no solar benefit, much more benefit, like 11 megawatt. So, there is an additional solar plant already started. So, for that, we get the good margin and good ratio over there. And peach bottom, that is a major two things.

If we compare from quarter 1,26 to quarter 1,27, almost 1.1% we are saving in the electricity due to the solar farm. So, various other things, a lot of, we are working on the cost reduction and cost optimization. So, therefore, our data package is improving day by day.

My question was more specific to pinch bag. So let's say with the newer capacity getting commission from October 27, 2027. So in FY26, out of our total volumes of 38,000 tons, how much was the pinch bag volumes and how do you see those pinch bag volumes moving over next three years? If you can share your thoughts here.

Sir, right now, at the last chapter, and previous year, previous chapter, like we are at 19 to 20 percent of each welcome back early, and currently we are working on 22.5 to 23 percent. So that area also will be increasing.

Sir, the IC is increasing just because we have added the two pinched bottom bag in last quarter of financial year 25, 26, so that's why just the ramp up of that, we are assuming this financial year 27 was the first quarter where we have gained the benefit of another machine which was installed in last quarter.

Just to add, last question from my side. So, you mentioned about the pinch bottom bags and the newer capacities. So, like, A, What's our strategy in terms of placing those pinch bottom bags to a higher volume with the customer? Why the customers would switch from the PLWPP films to pinch bottom bags? And third, once our capacity is commissioned, when do you feel that our total capacity of 70,000 tons would be fully utilized? Thank you so much.

So, first of all, I would like to answer the first, PLW to PLWPP plus both welcome back. So, sir, this is a normal practice. People are, they are using the root back to PP back, PP back to PLWPP back. And now, we almost, our 70% chance is the PLWPP back. So, a great customer, we have a very good connection with them. They also understand the branding and everything. So, they are moving from CLW to CLWTC plus Kinch welcome back with the installation of the Mark Enterprise machine. So, always, always, they are very... There are two types of things. They are in place for the machines and as well as they will get the good advantages of the pinch bottom bag, the branding. So for that they are moving to the PLW to PLWPP plus pinch bottom bag. So that is the first thing and we have that conversion ratio, we have very good expertise and we have a master in network. We are increasing our pinch bottom bag capacity year on year and also the same way we are planning for that. So that is the one thing. And the second thing... Thank you. Thank you. We have always good plan for the utilization of our installed capacity. So, definitely, we try to get the good installed capacity as early as possible.

Thank you. Mr. Jemuria, please rejoin the queue for more questions. Next question comes from the line of Lakshmi Narayanan with Tunga Investments. Please go ahead.

My question is that, I think our largest customer is based in the U.S., right? Am I right? Yes, sir. And what kind of contract we have? Is it, you know, and how long has been the relationship? And how do we supply? Do we supply in films? And then are we supplied as, you know, finished bags to that customer? And, you know, whether we have and how the pricing happens, and is there any foreign exchange gains we have got in the current quarter?

Yes, sir. I'll give you one more answer. Sir, for example, our 12% is a Cargill customer in US itself. It is a good customer. We have like started that communication from 2017, and after two years' hard work, we on board on 2020. At that time, we started like a one country 40 crore business in 2020, and right now we are working at SKU like a 40 SKU. So, 6 crore business. 6 crore business, 40 SKU in 2020. Right now we are working 140 crore business and almost more than 600 SKU. So we have a very good relationship between the Kargi and not even limited to the USA. We have a very good global supplier of the Kargi. So more than like 8 countries we are working with them and we are working with them. The pricing, initially we start with the UASP, but from last three years, we are into the contract system. There is one contract, it is carried two years, one additional year, like the raw material pricing, polymer pricing, plus conversion cost. So, altogether, they will buy from us, and they buy only finished product, not semi-finished product. They buy from us from the bag. So, they use for the animal food, dog food, pet food industry, the product into our bag. So, we manufacture bags over here with all the branding and everything, and we send to them. The best part, just for the information, at the time of 50% tariff, 8-month tariff, they complete our business. So even we give their options, we have Oman facility. At that time, we decided we make the new facility Oman facility, but they told us we buy from only lake packaging, India plant only. Then we realized why they continue with us. Thank you. So, it is a less than 1% cost of the entire product. So, for half percent, 0.75%, 1% cost, they not change the supplier. So, at that time, we understand this scenario, and for that, we continue the business with the car gift. So, from that entire costing, it is a less than 1% cost. Packaging material. And compared to local, local, I think 2, 2 and a half, 3 percent question of the local buying. Instead of that, then you get the good price from India and the good price from the neck packaging. So that's why we have continued this research from very long and very good long-term content here. And current actions here. So this is for the USA business. Currently, last year, we have closed one of the 40 flights for our business system.

Continuation of this, your answer, sir, 1.6 crore in foreign currency gained during the first quarter of financial aid 20%.

How much? And, you know, we are on this product where, you know, our dominant product, right? In the dominant product, what kind of competition, what kind of market share we actually have in India? You know, for example, we have almost 43,000 tons in terms of capacity. How large is the next competitor in this space in terms of size?

Yes. Organized, to be very honest, the pinch bottom bag, then PLW PP bag, there is the, see, PP bag, then jute bag, then the bulk packaging, India have a lot of companies. But the product mix is a difference. See, packaging company for the packing of the grain and pulpits, fertilizer, animals, catechins, there is a lot of option available, jute bag available, then PP bag, plexographic printed bag. So we as a company has innovated this VOP printed, laminated bag. Like I will give you one example, like we are using the Rice 1KG, 2KG, 5KG, there is a branding printed bag. Before 2004, they have to bet 25 kg same rise when there is a low branding availability in the market. So our company initiated this branding into the 25 kg bet on the same to same like the 1 kg pound branding. So from that our company journey has started and then after continuing growth on the brand, we decided our customer is 100% those who are believing to the brand. So, right now, we have more than 2,000 customers and more than 13,000 SKU. So, for that, we are making the bag for the brand only. So every customer has their own brand, we print on it, and then we make supply to them. So for that we have no problem for this kind of issue.

For market fair, basically, as confirmed by LPSY, there is no competitive peers on listed with us, and that's why we cannot compare Apple to Apple with them. Basically, in pinch bottom, we are the leader in the market, in Indian market, and other PLWDPs also very good, so we are continue growing, and our customer demand is increasing day by day.

Sir, I am adding on it, like 10.10% market share as per the TechnoPack last year one report. We have the industry's report. So, we have the 10% market share of the entire packaging this kind of bag. And our majority, our 56-55% export and only 35% is a domestic sales. So, above actually compared to peer. So there is the two, three companies, one is Thailand, one is Cambodia, and China many. But China is anti-tumping, so they are not directly competitive to us. So Thailand and Cambodia is a direct competitor to us to not even make... The labor cost and electricity cost is much more higher than the India. So you can check online, everywhere you can see the whole production cost. Compared to Thailand and Vietnam, India is a lower production cost. The most important, not even the make packaging, entire industries, this kind of product, textile product, this kind of packaging, textile, technical textile, specialized packaging, India cost is today is the lowest cost of all over the globe. Well, secondly, Yes, we are a competitor in U.S.A., like a Polytech is our peer, exactly peer. They are into the U.S.A., the manufacturing bags into the U.S.A., and they are 100%, we can say, the competitor and peer. But their cost and our cost is a very huge difference. I can give you one example. They are selling dog food bags. One bag almost like a 0.7 cents, 0.25 cents, and the same bag we can sell 0.35 cents or 0.35 cents, max to max. So, that kind of difference we showed here, but pricing, we are very good in India.

Thank you. Mr. Lakshmi Narayanan, please rejoin the queue for more questions. Next question comes from the line of Nihal Shah with Prudent Corporate Advice. Please go ahead.

Thank you for the opportunity and congratulations. So, this EBITDA per Q54.

Mr. Shah, sorry for interrupting. We cannot hear you. Can you speak a little louder? Am I audible? Yes, please go ahead.

Yeah. So, this 54 rupee per EBITDA per kg, what is the future guidance for this number? I guess this is a pretty strong number as it is. So, do we see any further scope of improvement here, and what is our volume growth guidance for FY27?

Sir, thank you for asking the question. Definitely, sir, we try all the best to work hard, and our speciality is with the making back, and profit will come automatically. So, always our focus in good value-added products, and always export, both focus and export. Last quarter, we have 71 countries. Currently, we are reaching into 74 countries. So, always we are adding new countries, new products, new customers, and like right now, we have 55% of our exports, and like Our majority is the pinch bottom bag, and last quarter we installed two machines in the finishing area, and it's very expensive, nothing like 20 crore, one machine cost, and our focus is to sell pinch bottom bags into the market. So definitely, as the past experience and past financial figure, the same way we are growing into the future as well.

What is the margin difference for our export orders and the sales that are made domestically?

Sir, mostly 5-6% always, as for the previous data, always 5-6% always difference will be, because domestic is low margin and export, we can get a good margin up to 5-6%. GP.

GP, oh, okay. Thank you. Thank you very much.

Thank you, sir. Thank you, Nidhi.

Thank you. Next question comes from the line of Ashish Sroni, family office, please cover it. And also a reminder to all the participants, please stick yourself to one question. Thank you.

Sir, next two, three years, growth will come from what sort of product category as well as from geography. So if you can give a breakup, that will help.

Ashiji, definitely, I mean, right now we are working on 74 countries. So, see, we are always adding the new countries, new countries. And geographically, we are already present like in Europe, many countries like African countries, Gulf countries, US, North America, South America, all the places we are already present over there. But geographically, always those countries. However, cost of the labor, normal labor, 500 and above, we are a customer country. Because this product is a very huge labor, like today we are almost on board on the contractual labor, more than 2,000 labor. So, definitely this is the laborious product. In packaging, you never have like this kind of numbers on paper. But this is a 100% laborious product with the high-end technology. So that's what we get the good advantages. And those countries have a 500 cost of the production. More than that, they are my customer countries. So geographically, we are adding. Sir, about the product, yes, just we recently innovated 2017-2018 Pinch Bottom Bag, and we started our baby step on 2021. So this is the Pinch Bottom Bag, it is still new product innovation in this kind of thing. In 23, we have gathered 10%, and 24, we have the sales of 16%. 2025, we get the sales of 20%, and currently, we get the 23%, near the 22% to 23%. So, always our focus, that is a value-added product, and always our focus to increase our pinch-bottom bag, and we started this IPO journey with the pinch-bottom bag expansion and all the things. So, definitely our focus on more in that area. And more than that, always companies innovative. Always, I can say, we try new innovation, new innovation, and new innovation. So, always we try to get the new innovation, and also we are on that development area, we never stop on our next packaging. So, the same way as... with the new product and new customer and new area, so then we grow furtherly. Thank you.

Thank you. Mr. Soni, please rejoin the queue for more questions. Next question comes from the line of Mitin Babul Alkandi with InnoQuest Advisors, Private Limited. Please go.

Thank you. I wish you congratulations on successful listing. Just to share some thoughts on what is the gross block addition in this quarter and 380 crore expansion which before that will you be adding anything in a gross block and whether the 380 crore gross block addition in 27 will also maintain the set down of 2.5 plus. Thank you.

Nitinji, first of all, thank you. Thanks for your wishes. And try on your business to go more faster as possible. So, sir, first of all, yes, sir, what will give you guys about this gross block? So, just for a minute.

So, I'll explain to you, sir. Today, as of now, 30th, June, 2026, our total gross block is 416 gross. Compared to this previous financial year quarter 1, financial year 26, that was the 273 crores. So that almost we have added 141 crores within the one year epic fame of time. And for quarter 1, only the quarter 1 financial year 27, we had added 30 crores, 75 lakh in our gross block.

Thank you. Mr. Gandhi, please return the queue for more questions. Mr. Gandhi, please return the queue for more questions.

Hello? Ashish Ji is there? Mr. Nitin Ji is there?

Please go ahead.

Okay, okay, okay. Because we have one more question, so I would like to answer that cross-block continuity or same or not. So, sir, we try our level base to as much as possible turnover we can get from the business and value-added product. So, our best try to maintain and better on that situation. Thank you. Thank you.

Next question comes from the line of Ram Singh.

Hello, am I audible, sir? Yes, sir. Sir, congratulations for good set of numbers. Listing के लिए भी आपको बहुत हो बढ़ाई हो. अभी भी हमने इस पार्ट में जे ब्रोफ दिखाई है, sir. Around 40% revenue और EBITDA margin में हमने इंप्रोव किया है. आने वाले quarters में हम ये growth maintain कर पाएंगे, sir?

Sir, very honestly, we've done this in the past quarter. We've done two plants after that. One recently, we've done one recently and one also done one. So, these plants are already going, and we're going to go. The whole year, we're going to start our new production. The next, October 2021, is planned in October 2021. So, we've already rented these plants. So, we are trying to get that maximum utilization on it. I can continue to try and maintain it, sir. Same to same.

Thank you. Ladies and gentlemen, due to time constraints, we have reached the end of question and answer session. I now hand the conference over to Mr. Alpes Tumsipai Patel for closing comments.

Thank you. Good morning, everyone, and welcome to the call. In the meantime, everything is perfectly done. Protocol is even a process of onboarding. So that is a very long process. So, when we look at our rent and plan, our marketing is increasing. So, that's why we see growth, because our customers have also joined us. And in the future, our pipeline is also in the future. So, we accept that our results will be increasing. Thank you, sir.

Thank you. On behalf of NAT Packaging Limited, that concludes this conference. Thank you for joining us. You may now disconnect your lines.