Mayur Uniquoters Ltd (MAYURUNIQ) Q1 2027 Earnings Call Transcript

Ladies and gentlemen, good day and welcome to Mayur Unicultures Limited Q1F527 Earnings Conference Call hosted by Monarch Network Capital Limited. This conference call may contain forward-looking statements about the company, which are based on beliefs, opinions, and expectations of the company as on date of this call. These statements are not the guarantees of future performance and involve risks and uncertainties that are difficult to bear. As a reminder, all participle 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 start then zero on your touch-tone phone. Please note that this conference has been recorded. I now hand the conference over to Mr. Rahul Danny. Thank you. And over to you, sir.

Yeah, thank you, Anushka. Good afternoon, everyone. On behalf of Monarch Network Capital, it's our pleasure to host the Senior Management of Major Uniquarters. On the call today, we have Mr. Arun Baggeria, Executive Director, and Vinod Kumar Sharma, C.F. of the company. We will start the call with opening remarks on the management and then move to Q&A. Thank you and over to you, sir.

Thank you, Rahul. Good afternoon, dear investors and analysts. It's a great pleasure to address you as we reflect in the past years and look forward to the future of the company. Your support and trust in Mayur Indicators have been instrumental in our success, and we are honored to share with you the performance of Mayur. Thanks for giving your precious time to join Mayur Indicators Ltd. Q1 FY27 conference call. Mayur Unicotors Limited, being a market leader in the synthetic leather industry and an organized player, has been able to leverage emerging approaches and deliver exemplary performance in past years, both in national as well as international business markets. Now, I would like to start with financial highlights for Q1 FY27 under review, and we will also reply to your queries after our review of the financial results for the quarter. The company has achieved the revenue from operations on a standalone basis is Rs.247.03 crores, PBT 7.79 crores, and PET 58.95 crores. In this quarter, the standalone revenue increased by 20% and PBT and PET both increased by 41% and 43% on Y-on-Y basis. The revenue from operation on consolidated basis is Rs.269.23 crores, PBT is 74.12 crores, and PET 56.12 crores. In this quarter, the consolidated revenue increased by 25% and PBT and PET both increased by 35% and 38% respectively. Our endeavor is to make the company the preferred supplier for the leading OEMs in overseas market, especially the U.S. and European regions. And in this context, we have received some good OEM supply orders from USA, which have already started making good contribution to our export sales, revenue, and overall business profitability. And this sales growth and increased momentum is expected to continue in the next two or three years. While pursuing our business interest, Mayur Unicotus has also been endeavoring to fulfill our responsibilities to our society. Under the corporate social responsibilities programs, we have contributed to our regular plantations, around 50,000 plants already done, and have a plan to do it at large scale in coming years. The company has also adopted many happy schools for education of children. The company has worked on education for all and underprivileged children. Various health care initiatives, especially child and school development, water for all, sanitation at the school area, distribution of books, bags, clothes, etc., and most importantly, family planning and family welfare schemes in nearby villages. The state government has also recognized these initiatives on various platforms. I am thankful to all the investors for their valuable time to those who became part of this earning call. With this positive note, I would like to conclude and request you all to open the forum for questions and answers. Since we have a limited time of 45 minutes for the call, therefore, request to please avoid repeated questions. And I am also giving you the segment breakup. You may note down. Export General 30.24, Export OM 73.56. Total exports is 103.80 CR, auto OM domestic 56.08, replacement 36.52, footwear 41.16, furnishing 6.08, and others 3.38, and total domestic sale is 143.23. Total is 247.03. Over to you.

Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and 1 on their touchtone 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. Moving further, in order to ensure that the management is able to address questions from all the participants, please limit your questions to two per participant. Ladies and gentlemen, we will wait for a moment while the question queue assembles. We take the first question from the line of Shubham Jain from NB Alpha Fund. Please proceed.

Thank you so much for the opportunity and I hope I'm audible. My first question was the growth that we have shown in this quarter of 25%. How much of that was driven by volume and how much of that was driven by realization?

The growth is driven by the volume is around 2% and the remaining growth has come from the price part.

Okay, and this realization increases because of raw material price increase or is this because of mix change?

It's a mix because not only raw material prices, it is because Our export business has grown, so it's a higher price item. So that's the reason for the growth.

Understood. Understood. My second question was on, we were going to expand another line in our existing facility and we were evaluating our greenfield expansion as well. So what's the current plan in terms of expansion and what is the CAPEX plan that we're planning to do over the next one to three years?

So, we have already intimated in the last call also, so we have already ordered the line for our expansion in our current premises. So, we should be able to start our production by towards the end of this financial year, somewhere between February, March, 2027. So, we'll have an additional production capacity of 5 lakh meters. So, we are looking at two more expansions, but that is not finalized till now. One may be outside India, and one may be in India, but that is India will take a longer time because we have already expanding our operations over here. So, if we go outside India, we are still evaluating where we want to put. We have not taken a final call on that. Once we take the final call, we'll let you know.

Understood. So, just a follow-up on this. We've been speaking about this international expansion for a while. Sorry to interrupt, Mr. Shubham. Ma'am, it's a follow-up question on the previous question itself.

Okay, I'll just tell you, because there's a lot of volatility in the market, we are still getting business with the current setup right now. We definitely need to put more plants somewhere outside India, but because of all this Trump tariffs, the West Asia war, or multiple things happening in the last few years, we have not taken a final call which should be the ideal location to put our plants. So it could be in Mexico, it could be in the U.S., it could be in some other NAFTA areas. We are still considering various options, but there's so much of... Uh, volatility in the market, so it's not easy to decide where exactly we should put the plant right now.

Understood, understood. And, uh, based on the expansions that we have already done, what is the peak revenue that we can do as per realizations today?

Uh, so the expansion that is, uh, by adding one more line?

Yes.

So, just simple, like if you just add 5 lakh meters into 300 rupees a linear meter average price, so it will just give you around 150 crores more per Yes, per year, annually, then we have some capacity and additional facility also. So maybe an additional 300 crores to 400 crores, but it depends also a lot on the product mix. So like, are we expanding more on the export front, or are we expanding more on the domestic front? But anywhere between 250 to 400 crores could be a figure that you can see depending on the product mix.

Understood. Thank you so much. I'll get back into it.

Thank you. We take the next question from the line of Molecule Ventures. Please proceed. Hi, sir.

Can I hear you?

Yeah, yeah. Please.

Yeah. So, first of all, congratulations on a good sense of numbers yet again. So, first I wanted to ask you regarding the volume mix that we have mentioned, the export mix, sorry. So, can you just repeat that if it's possible?

All the numbers are only export and domestic.

Yes, export and domestic.

In total, export total was one, yeah, export is 103.80 crores and domestic is 143.23 crores.

Okay. Sir, I have followed regarding the export. So, in the last consult, you mentioned that the margin expansion is primarily because of value-added mix and the growth coming from the export market, and a sustainable number would be between 25% and 30%. So, what was the reason that sequentially we basically did not continue with the same trend on the margin? And going forward, what is our outlook on the export market?

No, this margin is actually, we told you earlier also in our previous con call, that's margin, our sustainable margin will be 25 or plus 1 or 2 percent. But last quarter, it was abnormally high because of foreign exchange, abnormally high increase in foreign exchange rates. So that was a one-time increase, basically. But the present quarters margin will be sustainable and expected to continue.

Okay. Is there any reason for just 2% volume growth? Currently, what is the capacity utilization of our existing capacity?

So we are utilizing somewhere between 75% to 78%.

Okay, and how much would this 5 lakh meter attribute to in terms of capacity addition?

I just told you the figures just two minutes back. So basically, so we have an installed capacity of 3.5 million, so it will be like, for PVC I am talking about, so it will be 4 million meters per month basically. But it depends again on the product mix. So if we are making more products based on less thickness, maybe 0.8 mm, it could be 4.1. And if we are making more thicker products, it could be 3.8. So capacity also depends on whatever product we make. But you can say somewhere between 3.5 to 4.2 million meters per month.

So, why I'm trying to understand this, sir, this is the last question for my man. So, what I'm trying to understand, sir, is because we've already operating a 75 DTC in capacity utilization and the 50 crore additional line won't basically move that much. It's just the major KPEX that we've been planning for a long time now, which, again, as you mentioned, we are still evaluating. So, I just wanted to understand your perspective on the next leg of growth. So, how much time would you think will it take for us to finalize on the timeline and, you know, start with the major case?

We have already said that you can expect a top-line growth of between 10 to 12% for the next three years. This is what we can say currently right now, and this we have mentioned very clearly on this thing. So, anywhere between 10 to 15% growth, because certain things sometimes you plan and it's not in your hands. So, anywhere between 10 to 15% growth, we are not looking very strong growth in the domestic market, but yes, we are looking at a very strong growth in the export market.

Okay, that's it for myself. Thank you. All the best.

Thank you. A reminder to the participants, please limit your questions to two per participant. We take the next question from the line of Viraj Kacharya, from SIMPL. Please proceed.

Yeah, hi. Thanks for the opportunity, and congratulations on a good set of numbers. Two questions, sir. One is, if you, you know, when you take 2% volume growth in the quarter, And if you see the market, you know, especially auto, you know, production itself has been upwards of 18-20% year on year.

Okay, that is not necessarily true, excepting domestic footwear market, we have... We had a degrowth in the last quarter. I think so we have, if you compare YOY from last quarter to this year's quarter, I think so we have grown on the domestic front also. And there is a degrowth in the export OEM market because the shipments will start going more from this quarter onwards. So, it's not that there's a decrease in the domestic market and an increase more in the export market. Exactly, you can say how much is the value, you can say what is the difference.

I mean, if you can just give volume growth for domestic and export.

Volume growth for domestic and export is in total. Export is 9.9 plus.

Yeah, so my point is, in domestic, we have just had a flat growth. When the auto production numbers have seen a very healthy growth.

But again, some markets perform well, has performed well in the last quarter. Some markets have not performed very well. So specifically a footwear business, because you have to understand the price of raw materials for footwear, not only the PVC prices, their sole prices increased drastically. It went up to almost like two times, three times last year, sorry, in the last quarter. So obviously the market was muted in the footwear segment.

Okay, second question is, see, if you, you know, look at our overall volume growth, which you share, you know, export has grown by 9%, and typically, that is also where you have the highest margin. But if you look at an EBITDA or a gross margin basis, we have seen some moderation. I understand, first quarter is not a true benchmark to look at. But given the increase in mix, one would see probably, so was there any under recovery of raw materials which needs to be passed on to the customer? I'm just trying to understand.

Sometimes it takes time. Sometimes for strategic reasons, you don't increase the price for some customers, not for all customers. So obviously there was an increase in the raw material prices. It started happening in the month of March. And the market has been very volatile since then. The prices went up very sharply. Then there was a fall in prices of some geometry years. Then again the prices went up again. So it's been a very volatile situation. So it's very difficult to predict. Situations which is out of our control. So it's something that no one can predict. No one knows what will happen with the West Asia war tomorrow. Things look very stable right now. So obviously whatever projections we give, we give based on our normal market situations. Certain situations are not in our control which we cannot predict right now.

I completely agree with you, sir. I was just trying to understand if at all there was an under-recovery or not. I understand the environment we are in is very volatile. Last question.

We are just giving you a picture of the long term prospect of the company. We are not coming to what is happening in the next quarter, what will happen in the last quarter, or what will happen in the quarter after that. Whatever we are talking about right now, we are talking about the long term prospect of the company. So, last time, we said that quarter to quarter, don't do any analysis on the basis of our projections, yearly, under normal situations, yearly, and so much growth should come, and so much margins should come, plus minus one or two percent, but there are certain market situations that are very volatile, and that is our control.

Got it.

But we are very confident that whatever we are saying, we should be able to achieve.

Understood. And last question, sir.

Mr. Gharaj, I would request you to join back the queue as there are several participants waiting for their turn.

Thank you.

We take the next question from the line of Kiran from Table 3. Please proceed.

Thank you so much for the opportunity, sir. Couple of questions, sir. I don't know. Our exports OEM last year same quarter, like Q1, FI26, was 53 crore. This year we did 74 crore, which is a 39-40% increase in the export OEM space, which is fantastic growth when it compares same quarters. So, after 40% of export OEM growth, the gross margin has not even improved. So, is it like, I mean, even accounting for raw metal price increases, is there anything where we are facing pricing pressure on export OEM market?

So, there are two parts, actually. The first is because of the Gulf War, the price in Cuba. And secondly, because of this war, the shipments' cost have also increased. Got it. Okay. Four times higher discipline cost per decrease.

See, aysa hai, sometimes in the sport OEM market, probably, a quarter ke basis mein aap jake customer se price increase nahi maang sakte ho na. You have to see how the market, because, see, the war started. Then the war died down also. We initiated requesting for a price increase. The crude prices started coming down. Everyone thought that everything will be stabilized and everything will come down. So, we started to hold the pressure, which was very unexpected. So, obviously, we have not taken a price increase in the export market, but you have to see another thing, 10% has become a big natural hedge. Today, if I was paying for $8, I was paying for $8, I was paying for $85 or $86, so I got a natural hedge for $94, so I got a natural hedge for $10, so my raw material prices went up beyond that also, but we had requested, but we had not pushed because prices started coming down also very fast. So, we have not taken any increase from my customers in the export market right now. I am in the export market at least, for the time being.

Got it, sir. That is very helpful. Thank you so much. Second question says, our other expenses, quarter on quarter, like March quarter to this quarter, 9 crore bada hai. So, is it a combination of forex losses and shipping or only shipping?

No, it's a mixed reason. Some shipping cost, I already told you, shipping cost increased in this last quarter four times, okay, for the export. And some traveling cost and other service cost, legal and professional, etc., which we have incurred on that account. That expenses have increased in this quarter.

Got it. Sir, this will be a recurring expense, right, sir, because freight costs have been elevated for a substantial number of months.

No, we cannot say that this will be continued, but since the situation, the war situation will be improved, then definitely the freight charges may come down.

Got it, sir. Got it. Sorry, Tandrall, Mr. Kiran.

I would request you to join back the queue.

Sure, I mean, that was just a clarification, but yeah, fine.

Majorly, because of this rate increase, and remaining is some service providers cost, and this one traveling, and risk coverage cost. That is, yeah, thank you. Perfect, perfect. Thank you so much.

Thank you. A reminder to the participants, please limit your questions to two per participant. We take the next question from the line of Aman Soni from 7Alpha Investors Private Limited. Please proceed.

Hello, Mr. Amardu. Yeah, yeah. Because of the recent SBA signed by India, how do you see our business from leather segment to shape up over the years? Maybe in the next two to three years, how do you see growth coming in?

I think this is a very positive move for India. Definitely will be more effective in terms of cost. The sentiments of the customers to procure from India will definitely increase. And definitely both, especially in the Europe market, I have a lot of good sentiments. Maybe customers might think of buying from India which they were avoiding because of their de-risking policies. So, it's a very positive sentiment. Cannot comment that the business is so big right now, but yeah, a very strong sentiment.

Sir, can you please spend some time on explaining the current competitive landscape in the industry because we are seeing that automotive seating space is getting traction. For example, recently, you know, Minda announced their entry in high-value automotive seating systems as near players are entering The demand for synthetic leather will increase. So, does the attraction for near players to enter in this space, are you able to see that happen?

Okay, so, I told you our main area of decoat in the domestic market has been footwear only. Definitely, we are getting more business from the automotive OEMs also. And the business is not dependent on Unominda. The business is dependent by the OEM. So on which business model you get the business. So basically, tier one could be Unominda, but Unominda has bought into two wheeler seats right now because they had purchased the plant from Harita, I think, so four years back or three years back. So, we are already a supplier to them. They are also entering the four-segment market, but depends on which platform they get the business and which platform you get the business. So, the business is driven by the automotive. Nevertheless, our main four-wheeler business, which we are lacking right now, is... Volumes from Tata and volumes from Mahindra. So our business from Mahindra will be increasing in the coming years. Tata, we are still in a very initial stage right now. Definitely we should get some business, but which platform? It's very difficult to comment at this moment.

The line for the participant has been dropped. We'll just proceed with the next participant. We take the next question from the line of Raman KV. From Sequin Investments, please proceed.

Bajrusov, can you hear me? Yeah, yeah, we can hear you.

Yes, two things. One, if you can, our U.S. OEM business has been dropping around 80-90 crores per quarter for last, I think, three quarters. So, one is with respect to the growth of this particular business, what's your growth outlook, and from the growth perspective, are you expecting to increase your wallet share, or are you planning to increase your volume in terms of getting more orders from the US OEM clients, with respect to US OEM business? And if we can also provide U.S. OEM order book or a ballpark figure on that, that's my first question. I'll ask the second question later.

Sir, before we told you that our U.S. business will increase and in the next three years, the business will almost be, if not double, at least 60-70% of our U.S. business in terms of U.S. automotive. So, our share of business in Ford was very less. So, we have got... Good orders from Ford, and the business will increase with Ford also, and in Chrysler also. For U.S. automotive, the business will increase. The Europe automotive sector, we have business in South Africa, both for BMW and Mercedes. We are definitely trying with other automotive customers also. But until the proper headwings are not there, I don't want to comment on those business right now. Thirdly, for their supply in Europe, we are participating in RSUs, but we lost some RSUs in the past. More RSUs are coming in the near future until the business is awarded. I cannot comment on those things again.

Sir, you said 60% growth. Will it be product expansion or client expansion or wallet expansion? I'm asking.

Okay, so, I didn't say 60 percent. I said last. Next. Okay, so, if you look at that, I'm saying 60 percent. I'm not saying 60 percent. I'm talking totally good. But anyways, so, current client's business expansion will come. I mean, business share was very low. It will come up with the business. And we are always... Talking to other customers also, but it's no point commenting until some strong headwings will happen.

If that comes, then that will be extra.

Sorry, I couldn't hear the last part.

We are expecting the growth based on the existing customers.

The increase in the volatility of existing customers, basically. And if we are also talking to other OEMs. But it's very initial stages, so it's very difficult to comment in the next three years when we get an extra business or not. If it gets an extra business, it will be extra.

Okay, and so my second question is, you mentioned that there was a raw material cost inflation as well as the logistic costs have doubled, almost grown forex. Have you taken any definitive price hike towards the tail end of this quarter or start of Q2?

I am specifically talking about the US. I have asked the last question about the price increase in the mail. But then the market started softening, so we didn't pursue those things right now. So mail gave us a strong push because you have to see long term because of strategic reasons, only price pushed by the market is stabilizing. So currently, if we talk about the US market, we don't have any price increase. So, wait, I'm going to ask that you have to take a plan for it. Are you going to interrupt, Raman? I'm going to answer that we will try and do it, but we will not do it now, because the market is softening down. We will see how the market behaves. 10% already price increase in terms of dollar rate. So, now we will push how much we will do it. It depends on how the market will play in the next 2-3 weeks. It depends on how the market will play in the next 2-3 weeks.

Understood, sir. Thank you.

Thank you so much.

Thank you. We take the next question from the line of Ashwini Damini from Ratnabali. Please proceed.

So most of my questions have been answered already, but just to confirm, you mentioned that the 9 crore expense, how much of it can we assume to recur next year, next quarter, and how much is non-recurring?

We don't have the exact figures for those, one exact figures for those things. What do you want to say?

Other questions?

You are comparing 9 crore increase from last quarter to June quarter, right?

Yes, sir. So, I found it, I mean, this is between standalone and...

I think your comparison is not correct.

Basically, in March quarter, there was, I think, increase in revenue also. So, you have to reduce the increase percentage, and then you should compare. And the majorly the difference is because of, I have told you now, the difference is because of increase in logistic cost, majorly on account of export and service cost and risk coverage cost.

This difference is also in your standalone versus consolidated results, similar 8-9 crores. So, is this expense relating to some subsidiary?

Some part is relating to subsidy, and major part is for the MUL only.

So this will continue to recur to you, for a couple of months also?

Partly, partly will continue, and partly will be, I think, coming down.

Thank you, sir. That is all.

All other questions have been answered.

Thank you. We take the next question from the line of Ravi Naredi from Naredi Investment. Please proceed.

Sir, what is our capex plan for financial year 27 and 28? Around 50 crore.

Both which only 26-27, I told you, for the financial year. 26-27.

And 27-28, anything we have planned?

27-28, it depends if we have taken a final call on putting up a new facility somewhere. So, if that happens, then in two years, you will have a capex, but now it will be additional, but after the final call, you can tell us about the number of calls.

I'm sure you are telling that number.

Okay, okay. Sir, how is Suresh Zipodar's health and he is managing everything well?

Ah, I have a little bit of a question, I have a little bit of a question.

Okay, okay, okay. And any MD, full-time MD, Mr. Ndhavi?

The participant is out of queue. We'll take the next question from the line of Madhul Zathi from Counter-Cyclical Investments. Please proceed.

Sir, thank you for the opportunity. Sir, I just wanted to understand that how is the raw material pricing currently versus what it was in Q1, and can we expect the gross margin improvement at least Q1Q basis even without the price hike?

See, raw material prices are based on Q1. Some items, sort of prices are soft. Then, it increased. So, the market is volatile. I will say it's a little softer, but it's still expensive than what it was in the month of March. I went to the beginning of March and the end of February. Right.

So, when will we decide if we would like to go and ask our customers for a prize, like?

No, no, no. I'm sorry. I think so. We are taking a price hike for every customer. Only specifically, US Export OEM Market is talking about the people. We have already made the price hike, requested the price hike. But we haven't done anything yet. What happened in the meeting? 15-20 days, I don't know, but I don't know, but prices started softening very fast. And we already had an advantage of... U.S. on their appreciation. So, if we push a lot, we don't need a lot of push now, but again, the situation changed back two weeks back. So, again, we have sent a request mail. But, yes, it's aggressive. It's aggressive. We haven't pushed it yet. Right.

And just a clarification, sir, the U.S. customers with whom we expect our wallet share gains, are we replacing some existing vendors and the incremental growth will remain our share?

No, I'm doing both things.

Okay, both things. Okay, sir. That was from mine. Thank you so much and all the best.

Thank you. We'll take the next question from the line of Shreyanth Gandhi from SG Securities. Please proceed.

Hi, good afternoon, sir. Sir, my first question is, so, just wanted to understand the rationale of putting up an international plant. So, in the previous quarter, you mentioned that the cost for putting up that plant is also higher. So, just wanted to understand what is the benefit of us getting.

See, market is very uncertain, okay? And a lot of automotive companies, they think of dedusking their business also. So, today, we can expect a particular level of growth from India. But some customers want their suppliers to be near them. So, if we don't put up a plant near them, business long term may be very effective because they would like to dedusk their business.

Okay, okay.

So, okay, we have been able to maintain our stocks. We have never disrupted the supplies. The OEMs are very happy with us. But not all automotive companies would like to work with a company based out of India. And secondly, number one, if you become a global player also, your image in front of automotive companies also changes a lot. Thank you very much, everyone, and welcome to the call. The way your brand also builds makes a lot of difference in the eye of the automotive customer. In automotive, any customer.

Got it. Got it. The second question was on the domestic...

Sorry to interrupt, Mr. Shreyas. Could you please join back the queue? I still have several parasympans waiting for their turn.

Just one question I had on the PU plant repurposing.

So, there is no major change what we had discussed in the last quarter. There is a struggle there. There will be a bit of time. But there is no major change.

So, can you do it for the TVC or are you looking for a new plant only?

Because that has not revived. No, we can do it, but we can do it in existing, so we can do it differently.

Okay. Okay.

Thank you. Minor changes have to be possible.

Okay. Got it. All right. That's all for me. Thank you.

Thank you. Participants, please limit your questions to one per participant. We take the next question from the line of Avinish Chandra from SMIFS. Please proceed.

Congratulations, management, on a continuation of good performance. Sir, just one question on the margin front. You have already talked about a lot of things. In this quarter, we have very high RM. We have freight issues, related costs, and then we could not take any price. I can export OEM market. Still, we have 25% plus margins. Should we take this margin as a base margin and anything positive happens will give us better margin in subsequent quarters?

Yeah, yeah, obviously.

See, you said that you have said that you have a analyst point of view, company point of view, margin job, and the extra job, and the bonus.

Okay, sir. Thank you very much. Welcome back to you.

Arun sir, Arun sir, you said that it is our job, and our efforts always to better it. So, that's always true. The other thing is, you need to look at yearly margin. Because quarter to quarter, this situation is always true. Now, like you said, the freight portion, then something else, then raw material prices are slightly down. So, it will keep going up and down. But overall, the year-end margin, we are talking about that and we are trying to maintain that margin.

Thank you very much. All the best.

Thank you.

Thank you. We take the last question from the Saloni from Molecule Ventures. Please proceed.

Just a bookkeeping question, sir. Sir, we mentioned our sales volume of around 31 million meters in last year, FI26. Our capacity is 48 million, right? That gives us an average utilization of 65%. There is still leg room for some of the existing capacity.

So, there are two capacities we should talk about. One is PVC capacity. So our capacity is between 3.5 to 3.7 million meters, depending on the product mix a lot, you know, because some product has a faster line speed, some product has a slower line speed. And we are making around 2.7 to 2.8 million meters. So if we divide 2.7, also divide by 3.5. So we are already using 75 to 78% of our capacity right now. By adding one more line, our capacity will go up to 4 million or 4.2, again, depending on the product mix. But if I say 4 million also, based on our current capacity utilization, it will be 65-66% capacity. So we have a headroom to expand to 25-30% more capacity. And this is with the existing facility. Thank you. Definitely, we have not taken a call. We would expand in some other location also. Not decided. If we will do it in India, we will do it in India. We will not do it in India. But once we take a call, then only I can comment on those things.

Sure, sure.

We may not lose business because our capacity will not be a constraint for our business expansion. Thank you.

Sure, sir. Sir, if we could basically get a sense that we at current rate, is it loss making? And if yes, then what is our strategy going forward for this plant as we have seen basically more improvement for a long time?

Yes, we are utilizing our capacity. There has been no change since last quarter, in the last few months, largely because of market, very volatile market situation, the cost of P.O. specifically, both as an upper material and both as a sole material, the bottom part of the footwear. So, the prices were very fast and expanded. So, there was a very low response. PU, there is a lot of intense competition from China, for sure. So, there are two options. Obviously, I have told in the past also that we are talking at toe branch, but sampling bhi ho rahi hai, but abhi tabhi business confirm nahi hua. That is one strategy. We are not focusing too much on PU in the export market right now, because we thought it would be very tough to sell against China, but We are working on how we can capture some market and export. It will take time, so let us see that with this financial year, at least I cannot give you a very strong recommendation for PluPlant at the moment.

Thank you. Thank you.

Thank you. Ladies and gentlemen, due to time constraints, we take that as the last question for the day and would now like to hand the conference over to the management for closing comments. Over to you, sir.

Up.

Yeah, thank you, all the participants who have participated and spent a valuable time for attending this call of Mayur for Q1 FY27, and as we already told you, that management is trying their hard and best to achieve the expected results and informed results, And definitely, we will try to maintain the margin which we have given you in our previous quarter and this quarter. Thank you very much.

Thank you, everyone, for participating. I know because of limited time, we cannot fulfill every question of every participant. I hope there was some clarity on the direction in which the company is moving. And just thank you for participating. If you have any other specific question, please, you can contact the CFO directly or company secretary directly and we will be happy to help you in clarifying any other doubts you might have. The prospect of the company overall looks good for the coming three years at least. Let's see what we can do and wish us luck also and wish you luck also. Thank you so much. Thank you. Thank you.

Thank you. On behalf of Monarch Net Worth Capital Limited, that concludes this conference. Thank you for joining us, and you may now disconnect your lines.

Thank you so much.