Pondy Oxides & Chemicals Limited (POCL) Q4 2026 Earnings Call Transcript

Ladies and gentlemen, good day and welcome to Pondy Oxides and Chemicals Limited Q4 FY26 Earnings Conference Call. 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 then zero on your touchtone phone. Please note this conference is being recorded. I now hand the conference over to Ms. Sana Kapoor from Go India Advisors. Thank you, and over to you.

Sana Kapoor:

Thank you, Steve. Good afternoon, everyone and welcome to Pondy Oxides and Chemicals Limited Earnings Call to discuss Q4 and FY26 financial results. Today, we are joined by Mr. Ashish Bansal, Chairman and Managing Director; Mr. K. Kumaravel, Director Finance and Company Secretary; Mr. R. S. Vaidhyanathan, Executive Director; Mr. Vijay Balakrishnan, Chief Financial Officer and Mr. Pratik Gupta, Associate Vice President, Operations. We must remind you that the discussion on today's call may include certain forward-looking statements and must be therefore viewed in conjunction with the risks that the company faces. May I now request Mr. Ashish Bansal to take us through the company's business outlook and financial highlights, subsequent to which we will open the floor for Q&A. Thank you and over to you, sir.

Ashish Bansal:

Thank you, Sana. Good afternoon, everyone, and thank you for joining us for POCL Q4 and FY'26 Earnings Call. I hope you've had the opportunity to go through our financial disclosures available on the exchanges. I will walk you through the key strategic updates, operational progress and financial performance followed by a Q&A session. FY26 stands as one of the most remarkable years in POCL's journey with the company delivering all-time high production and sales volumes, revenue, EBITDA, PAT and profitability margins. The stellar performance reflects the combined strength of our growth strategy, execution excellence and operational discipline building on this momentum.

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Pondy Oxides and Chemicals Limited May 27, 2026 POCL has generated an outstanding 5-year CAGR of 24% in revenue, 52% in EBITDA and 67% in PAT, demonstrating a consistent track record of accelerating growth, expanding margins and creating significant long-term value for all stakeholders. Before turning to the numbers, I would like to highlight the business developments and growth initiatives that have not only contributed to our strong performance in FY26, but are also laying the groundwork for POCL's continued expansion and value creation in the years ahead. One of the key highlights of FY '26 was the significant progress made in expanding our capacities and strengthening our growth platform. During the year, POCL enhanced its lead recycling capacity at the TKD facility by 55%, increasing it from 132,000 metric tons per annum to 204,000 metric tons per annum. The expanded facility operated at approximately 65% during FY '26 and is expected to steadily ramp up reaching nearly 75% utilization in the coming years -- coming quarters. We also successfully doubled our copper recycling capacity to 12,000 metric tons per annum in Q4 FY '26, reinforcing our presence in the Copper Recycling segment. The facility is expected to progressively ramp up to 70% utilization during FY '27. Further strengthening our growth platform, the Board has approved the setting up of a 36,000 metric tons per annum copper cathode plant at our TKD facility in Tamil Nadu with an estimated investment of approximately INR 200 crores, funded purely through internal accruals. The project will be implemented in 2 phases of 18,000 metric tons per annum each and Phase 1 is targeted for commissioning by December 2026, which marks a significant step in expanding our nonferrous recycling portfolio and enhancing value-added capabilities. The facility will utilize integrated pyrorefining and electrorefining technology to produce LME grade A copper cathodes, strengthening our vertical integration capabilities. Upon commissioning, the project is expected to enhance the revenue and profitability through the value-added copper products, improve margins through a richer product mix, generate operational synergies across procurement,

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Pondy Oxides and Chemicals Limited May 27, 2026 logistics and sales and create a scalable platform for future expansion and diversification. It will also support import substitution, reduce the carbon footprint through increased use of recycled copper and further reinforce POCL's commitment to sustainability, circular economy principles and long-term value creation. Backing our growth strategy, POCL deployed approximately INR 49 crores towards capital expenditure in FY '26. We remain committed to investing for future and expect to incur additional INR 180 crores in FY '27 to support capacity augmentation in copper, downstream integration and other strategic growth initiatives. In line with its commitment to reward the shareholders, the Board has recommended a final dividend of INR 5 per equity share, representing 100% of the face value for FY 2025 - 26. Against this backdrop of strategic progress, our operational performance in FY '26 remained exceptionally strong with the company achieving record production and sales volumes of both lead and copper, reflecting the strength of our operating model, execution excellence and growing market presence. The procurement mix from imports stood at approximately 73% for lead, 61% for plastic and 98% for copper during the period. Our lead business delivered strong growth while enhancing profitability. Lead production and sales increased by 11% each in FY '26 to 104,481 metric tons and 100,727 metric tons, respectively, on a quarterly basis. Volumes moderated as we strategically focused on higher-margin value-added products. As a result, EBITDA per ton of lead improved significantly by 39% to INR 18,462 in FY '26 and by 43% year-on-year to INR 19,739 during the quarter, reflecting the success of our value optimization synergies. FY 2026 production and sales volume of copper increased by 7x, respectively, whereas EBITDA per ton stood strong at INR 39,896 per ton. Copper sales witnessed a significant increase in FY '26, growing by nearly 11x to INR 673 crores. Building on operational momentum, POCL delivered its strongest ever financial performance in FY '26, underscoring our ability to drive sustainable growth.

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Pondy Oxides and Chemicals Limited May 27, 2026 Revenue growth remained robust across both quarterly and annual periods. Revenue increased to INR 932 crores in Q4 FY '26, registering a strong growth of 80% year-on-year and 20% quarter-on-quarter for FY '26. Revenue stood at INR 2,939 crores, reflecting a 45% year-on-year increase driven by improved capacity utilization and higher production and sales volumes. Exports contributed 66% of total revenue during the year, highlighting our expanding global footprint and growing customer confidence. Sales mix between lead and copper verticals stood at 77% and 23%, respectively. In FY '26, additionally, value-added products accounted for 65% of lead segment revenue, reinforcing our strategic focus on increasing the contribution of value-added products to over 60% over the long term. EBITDA more than doubled on both quarterly and annual basis, reaching INR 61 crores in Q4 FY '26 and INR 218 crores in FY '26, reflecting the improved earnings profile of the business. EBITDA margin expanded by 212 basis points to 7.4% in FY '26, compared to 5.3% in FY '25. Profitability growth remains strong with PAT more than doubling on both quarterly and annual basis and PAT increased by 111% year-on-year to INR 38 crores in Q4 FY '26, while FY '26 PAT grew by 113% year-on-year to INR 139 crores, reflecting the improved profitability of the business. PAT margin expanded by 151 basis points to 4.7% in FY '26, compared to 3.2% in FY '25. Our consolidated performance mirrored the strong momentum witnessed in the stand-alone business. On a consolidated basis, revenue, EBITDA, and PAT grew by 44%, 102% and 127% year-on-year, respectively. In FY 2026, the strong performance continued during the quarter with revenue, EBITDA, and PAT increasing by 78%, 124%, 126% year-on-year, respectively, reflecting broadbased growth and improved profitability across the business. FY26 also witnessed notable improvement in our financial health indicators. Return on capital employed increased to 17%. Cash conversion days remained healthy at 53 days. Interest coverage improved to 20x from 8x in FY '25 and net debt to equity stood at comfortable 0.17x. Highlighting the strength of our balance sheet and capital efficiency.

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Pondy Oxides and Chemicals Limited May 27, 2026 In conclusion, POCL remains firmly on track to achieve its Target 2030 aspiration guided by a clear and disciplined strategy focused on sustainable growth, operational excellence and long-term value creation. We continue to expand our lead and copper capacities while strengthening our presence across adjacent nonferrous recycling segments to deliver 20% volume growth and 20% CAGR in revenue and profitability. Our growth is complemented by a strong focus on margin expansion with targets maintaining EBITDA margins above 8% and return on capital employed above 20%. At the same time, we remain committed to enhancing operational efficiency through innovation, modernization and increased value addition with the goal of deriving over 60% of revenue from value-added products. While significantly improving energy efficiency, anchored by a clear strategic road map, a robust balance sheet, disciplined execution, a sizable land bank, support of government norms, proven leadership and support from all stakeholders, POCL is well positioned to capitalize on future opportunities and drive long-term sustainable growth. That concludes my update. Thank you for your attention. We will now be happy to take your questions. Moderator:

Thank you, sir. We will now begin the question and answer session. The first question comes from the line of Dheeraj Ram with 360 ONE Capital.

Dheeraj Ram:

Congratulations for a great set of numbers. Sir, your goods has increased during the quarter. Can we expect this to continue? Or what was the reason behind this?

Ashish Bansal:

Dheeraj, thank you. And yes, we had some opportunity on trading in the last quarter, and we had taken up based on the opportunity that was available. And I cannot specifically say that it will continue, but definitely, there will be some trading, which has always been there. So I mean, as the opportunity comes in. Our focus is generally on manufacturing only, and that remains our commitment.

Dheeraj Ram:

And is this more related to copper, sir? Or do we -- should we correlate this to lead?

Ashish Bansal:

This is more related to copper.

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Pondy Oxides and Chemicals Limited May 27, 2026 Dheeraj Ram:

And sir, our lead volumes for the quarter has dipped slightly. However, we have commenced TKD I and TKD II. Is this a short-term blip or how do we take it for FY '27? What is the volume growth for lead?

Ashish Bansal:

This is only a short-term blip. It's not a big blip. It was a conscious decision. At the point in time when the supply chain was a little tight, we deliberately focused more on the value-added products and the customers also well accepted the change as they were able to get the regular products from other suppliers as we are one of the prime suppliers for the value-added products. So we were able to convert those into value-added products, giving us better margins over the quarter as well.

Dheeraj Ram:

And just last question, sir, is on the capex, what is your capex forecast for FY '27 as you've given INR200 crores? Is there anything else? And what is your capex for FY '28? And can you give inventory days breakup for lead and copper?

Ashish Bansal:

Yes. For the current year, our capex will be well within number -- approximately around INR 180 crores will be the capex – INR 180 crores to INR 200 crores for this financial year. And the following financial year will be probably in the range of INR 50 crores to INR 60 crores, unless additional anything else is specifically added, which we'll keep you updated.

Dheeraj Ram:

And this question on inventory days, sir, current inventory days in lead and copper breakup? And then what is it going to be in FY '27 and '28?

Ashish Bansal:

Currently, on -- overall, this thing, we stand at 53 days, but technically, it is well below 50 days. It was at that point in time because towards the end last week, there was some delay in a shipment due to some vessel movement and those payin/payouts were delayed by a week. So at that point in time, it showed a little higher. But once you account for that, we are well below 50 days. But as on the specific numbers, it is at 53 days.

Dheeraj Ram:

Any guidance for going forward, sir?

Ashish Bansal:

So for lead, we are at about 45 days. And in copper, we were earlier at about 70 days, and we have brought that also closer to 50 and below 50.

Dheeraj Ram:

And we expect this to continue?

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Pondy Oxides and Chemicals Limited May 27, 2026 Ashish Bansal:

We are very strongly poised to bring overall below 45 days as we had spoken earlier as well, and we are -- we will continue to do that.

Moderator:

The next question comes from the line of Akhilesh with Emkay Global.

Akhilesh:

So my first question is on the lead realization. So just wanted to get your thoughts on lead premium where we have kind of reported close to $ 700 per ton of premium. While if I look at our peers, they do somewhere around $ 300 per ton of premium. So what are we doing differently, which are fetching these obnoxiously high premiums compared to our peers?

Ashish Bansal:

$700 premium -- can you give me a reference to your calculation on the premium? Like how you have derived $ 700 and $ 300 numbers.

Akhilesh:

So I've got the realization number -- so it is somewhere around INR 242,000 and USD/INR of 91 point somewhere around 5?

Ashish Bansal:

Okay. That is your -- minus the basic cost, alright. So basically, the value-added products that we manufacture are specific alloys and all of that, which are blend of different other elements and metals. And the prices of those specific alloys are higher than the basic mix of the regular pure lead or the basic antimony alloys or something of those sorts.

Akhilesh:

No, I get that. But still, I mean, what kind of product lines we are into, which are facing these high premiums? Because if I look at our peers, like I mentioned that they are also into a similar kind of product line and they are doing premiums of around $ 300 per ton?

Ashish Bansal:

There are some specific niche alloys that we manufacture, which a few of the other peers are not manufacturing, and those alloys are what fetch us a high premium.

Akhilesh:

Could you please give us a couple of examples of that? What would that be?

Ashish Bansal:

See, these are very industry-specific alloys, which I mean, on an open forum, I would not like to give out the names of those specific alloys. But these are specific to those customers who are -- we are a one-point source for them to buy these alloys and hence, we demand and command those premiums.

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Pondy Oxides and Chemicals Limited May 27, 2026 Akhilesh:

Got it. And my second question would be on -- could you please talk more about Plastic and Aluminum segment as well? How are we doing there? Are we EBITDA positive? And if yes, then how much EBITDA per ton are we kind of making in those 2 segments?

Ashish Bansal:

So on the plastic, as we updated during our last con call, we were moving the unit and now the unit has been moved to the new location and it's been set up. And the production started around in the new location in March. And as of now, we are PAT positive, not only EBITDA positive. Currently, we are doing PAT positive. And we are very, very confident that this year, you will see on the Plastics segment as well, PAT positive numbers. In terms of realization -- per metric ton realization, we'll update you over our next quarter.

Akhilesh:

Sure. Because -- the question came because when I add lead EBITDA and copper EBITDA per ton what you have given in your PPT, that comes more than what EBITDA kind of you have reported, right? So just wanted to get clarity, the EBITDA per ton, what you report includes other income also or how is it?

Ashish Bansal:

So this year, plastic was largely negative, and that is why it is different. But now in the coming quarters, it will be positive.

Akhilesh:

And aluminum, are we doing anything there?

Ashish Bansal:

As of now, not much on aluminum. We'll probably look into that when we feel the time is right.

Moderator:

The next question comes from the line of Sagar Shah with Spark PWM.

Sagar Shah:

First of all, heartiest congratulations to the entire team of Pondy Oxides for delivering such numbers actually. Sir, my first question was related to the capex guidance. The capex guidance that you just alluded was around INR 50 crores to INR 60 crores for FY '28. For FY '27, we have already disclosed on the investor presentation. So still INR 50 crores to INR 60 crores of capex. So is this just for maintenance capex? Or does it include the capex for Mundra plant as well?

Ashish Bansal:

So basically, in this year's capex, what we have guided, this is in the Phase I. And also, it includes our other internal smaller capex and some balancing

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Pondy Oxides and Chemicals Limited May 27, 2026 equipment and so on. So the Phase II of the copper will require that INR 50 crores to INR 60 crores of capex. Sagar Shah:

So that means in FY '27, we go live for only 18,000 tons of incremental copper capacity, right?

Ashish Bansal:

By December, we'll go live for incremental 18,000. And after that, following 6 months, we'll go live for the next 18,000 -- 6 to 7 months, yes.

Sagar Shah:

Now my second question, sir, was related to the copper itself. You actually disclosed on the investor presentation that we are looking for the forward integration of copper. You even alluded on the presentation that you will be going for the copper busbars from the copper wires. So now can you -- can you actually highlight something that what are the exact -- what is the exact product profile that you are looking to clock? And secondly, is this different from the traditional copper volumes that we are actually already doing? So naturally, your EBITDA per ton also increase if you are going for forward integration. So can you highlight on that point, sir?

Ashish Bansal:

Sagar, we have not spoken anything on busbars or any other wires or something, which I'm not sure where the data you've derived from. But definitely, yes, the copper cathode project by itself is a forward integrated -- forward integration from what we are doing currently as recycling. And yes, from the point where we're doing recycling now, when we reach our completion of this copper anode and cathode project, the margins per ton will significantly increase. And once this copper cathode is done, then we will look into further products of forward integration.

Sagar Shah:

So at least for copper cathode, we can assume the same margins that we are drawing as of now?

Ashish Bansal:

No, it will be at an elevated level. As of now, what we can see, we are looking at about INR 60,000 to INR 70,000 per ton on the copper cathode versus INR 35,000 to INR 40,000 what we are currently doing. However, the precise numbers -- once the trial production is up, we will be able to give you more precise on the numbers.

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Pondy Oxides and Chemicals Limited May 27, 2026 Sagar Shah:

Fine, sir. My last question was related to our working capital actually. In this year, in spite of such a robust performance, actually, our -- we had a negative operating cash flow. And that is just because of the heavy trade receivables that are sitting on the balance sheet of around INR 265 crores. So can you split that between the raw materials and the finished goods of the trade receivables? And one more thing that basically, how are we planning in FY '27, FY '28 to bring in the operating cash flow to be at least positive in line with the PAT growth actually, so that at least we can have some better visibility and our -- so that in the future also, we don't -- we are not in a position to take incremental debt actually to cover up those receivables?

Ashish Bansal:

Let me just explain to you. This -- what you see as the negative cash flow is technically not a negative cash flow because this happened due to movement of some vessel, our export consignment getting delayed because of movement of time on some vessel departures. And that's when the receivables on the last week of March got moved to first week of April. So we technically around April 5, we received close to about INR 120 crores to INR 130 crores in payment in that immediate next week. And that is what has impacted the cash flow. And you have to look at it as a point-in-time figure when had this come in on time because of the external factors, the vessel not moving, these numbers would have been extremely positive.

K. Kumaravel:

Inventory is similar level. Only on receivable, as we explained, the month end March and the sales realization is delayed by a day or 2.

Sagar Shah:

Yes, right, sir. So can you split between RM and finished goods in the INR 265 crores worth of trade receivables?

Vijay Balakrishnan:

There's no RM and finished goods in trade receivables, Sagar, only the finished goods part of -- so it is purely finished goods aspect of it. If you see the inventory, it's only INR 36 crores increase, which is more or less with our increased revenue, that increase seems okay. As Mr. Ashish said, only on the trade receivable front, there is a huge increase. So that is a point-in-time figure, which has impacted our operating cash flows.

Moderator:

The next question comes from the line of Shweta Dikshit with Systematix.

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Pondy Oxides and Chemicals Limited May 27, 2026 Shweta Dikshit:

Congratulations to everyone on once again a good set of numbers. My couple of questions. Firstly, on the copper side, we commissioned 6,000 tons of additional copper in 4Q, and we still surpassed 3,000 tons volume mark within 4Q, what kind of capacity utilization are we now looking at on the entire 12,000 tons for FY '27? And second question, when we get into the downstream or copper cathode/anode capacity of 18,000 tons in the next phase also. What would be the difference in capacity utilization of that segment versus the current recycle copper capacity? And whether we'll continue to sell the recycled copper externally or use it to feed our TKD copper plant?

Ashish Bansal:

Yes, Shweta -- so we -- in terms of the recycled part, so this -- in the current financial year, we're looking at something around 9,000 -- 8,000 to 9,000 tons of the recycled copper. And in the 18,000 tons capacity in the first phase, we'll have the production for the last 3 -- that's the last quarter that will help. I'll say approximately anywhere between -- depending on the material -- raw material required, about 50% to 60% from this recycled copper will directly go into the anode process. And there will be other raw material also that will be purchased, which will be blended. So that will be the product mix in terms of copper.

Shweta Dikshit:

And FY '27 volumes, would this 8,000, 9,000 tons of sales volumes on the capacity of 12,000 tons. Is that correct? From the existing new cycle?

Ashish Bansal:

Yes. So including the copper cathode the volumes on copper will be approximately 12,000 tons.

Shweta Dikshit:

In FY '27. And sir, another thing was if we're looking at around INR 180 crores of capex for this year, how are we likely to fund it basis? I'm just speaking on the -- because still the operating cash flow is negative and we've already a little constrained on the cash side. So how are we trying to fund this INR 180 crores of capex?

K. Kumaravel:

In his opening remarks, Mr. Ashish clearly informed that this is through the internal accruals, we are going to fund this project. We are not going to take term loan. But anyhow we have sufficient net worth to handle this, though it is a point

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Pondy Oxides and Chemicals Limited May 27, 2026 of-time figure for the negative cash flow. We have sufficient profit earned available in the system to take care of this. Vijay Balakrishnan:

For Shweta, for the numbers part, approximately -- you see the overall reserves and surplus plus equity is about INR 800 crores, whereas if you see our borrowings is about INR 150 crores and now the balance is -- that too is short term. We don't have any long-term debt in our books. So we are very confident that we'll be able to meet this expenditure through our internal accruals and we have sufficient liquidity to meet it.

Shweta Dikshit:

And lastly, on lead volumes, we saw a significant decline this quarter. I understand the focus was on value-added products. But the new lead plant primarily focuses on pure lead and the existing ones focus on value added. So are we likely to see this run rate continue going forward when the focus is on value-added products or what kind of utilization can we expect on that 204,000 tons of capacity for FY '27?

Ashish Bansal:

Definitely, we would love to focus and will focus on value-added products more, but the volumes will not decline in terms of going forward. And we are looking at a utilization of approximately close to 70% on the new plant capacity -- 70% to 75%. So then we have good mix.

Moderator:

The next question comes from the line of Khush Gosrani with Geojit Asset Management.

Khush Gosrani:

Just wanted to understand this quarter, copper pricing has been very volatile. And we have seen some impact on the reported margins as well. So could you highlight how do you handle this? What has happened on the copper side? And how was the contract structure? That will be my first question?

Ashish Bansal:

Yes, you're definitely right. Copper prices have been extremely volatile and not only this quarter through the last whole year, they have been pretty volatile. As we have explained in our earlier calls as well, we maintain a completely hedged position on the copper side and as well as our forex as well, and -- which gives us a proper clear indication what margins we are able to derive out of the product. Further also, if this quarter, the margins have been better than the previous quarter, one of the good reasons being there was some good demand in the

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Pondy Oxides and Chemicals Limited May 27, 2026 domestic market on the copper, which fetched us little higher value and value addition for our recycled copper and that is what gave us a little better margins on the copper side in this quarter. Khush Gosrani:

Sure, sir. And when you say aspiration of 8% EBITDA margin. Currently, copper is at the lower level of margins when compared to lead. So is there room for increment in the copper margins? And by how much if you can quantify, that would be helpful.

Ashish Bansal:

With our current capacity, lead and this is blended, it will be lower. But when you look at our forward integration in terms of our anode/cathode plant and our further products that we are planning. The margin will definitely go up as I spoke to the earlier calls -- I mean on the earlier questions as well. So you'll have a blended margin of 8%.

Khush Gosrani:

And for FY '27 and '28, what are the plans for lead in terms of capacity addition and utilization levels?

Ashish Bansal:

We are looking at utilization of approximately close to 70% on the lead side.

Khush Gosrani:

And FY '28, we would need to add more capacity in lead. Are you planning anything as of now?

Ashish Bansal:

As of now, in these locations, we are not planning. We will try to move towards close to 80% to 90% utilization by FY '28.

Khush Gosrani:

And last question, where are we on the EPR norms in terms of implementation and taking the credit, etcetera?

Ashish Bansal:

So on the EPR front, the portal registrations are starting from June 1. And as of now, government has restructured and they are looking at the registrations and people to start uploading the data. And maybe in 3 to 6 months' time, they might then further come out with -- I mean, further framework for the same.

Moderator:

The next question comes from the line of Saransh Gupta at SVAN Investments.

Saransh Gupta:

Am I audible?

Ashish Bansal:

Yes.

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Pondy Oxides and Chemicals Limited May 27, 2026 Saransh Gupta:

Congratulations on a really good set of numbers, sir. Sir, most of my questions have been answered. I just wanted to understand, like we expanded our copper capacity from 6,000 to 12,000. And in December '26, we'll be coming up with 18,000 of copper cathode, which is a value-added product for us. Sir, I just wanted to understand like how the mix works like how much of the -- how much of the copper recycling will be used for captive consumption in copper cathode and how much will we be purchasing from the outer market?

Ashish Bansal:

As I just spoke, basically from the -- our own recycling about 50% to 60% we will be using, basically, from our recycling the lower grade will be used for the copper/anode cathode production and the higher grade recycled material will be directly moved for sales. So let's assume about 50% to 60% of our internal recycling will go into the copper cathode and balance into the direct market for sales.

Saransh Gupta:

Understood, sir. And how will this mix change when we move from 18,000 to 36,000 of copper cathode?

Ashish Bansal:

It should remain similar because also we have increased our raw material in terms of our recycling on the recycled part also, we increased from 6,000 to 12,000, and as the 18,000 comes up, we will also be pushing up the recycling part also close to 18,000 or so. So we'll try and maintain our mix of 50% to 60% from internal generation.

Saransh Gupta:

So it will be a fair assumption that from 12,000 of copper recycling will be going to 18,000 next year?

Ashish Bansal:

Yes.

Saransh Gupta:

Definitely. And sir, just one last question. Like we have a capex -- we have planned for a capex of INR50 crores, INR60 crores in FY '28. If nothing new attractive comes up for us, so we can assume a debt repayment in FY '28?

Ashish Bansal:

We don't have any -- yes, we don't have anything. What we have on our books is just for the working capital part of it. So we are a debt-free company in terms of any long-term debt or any of that. So we have not taken any debt on the books.

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Pondy Oxides and Chemicals Limited May 27, 2026 Saransh Gupta:

And going ahead, that would also reduce with our inventory days coming down to 45 to 50.

Ashish Bansal:

Yes. And we are not looking at taking any debt as of now, even for our further expansion or any of these capex that we've announced.

Saransh Gupta:

Sir. And any plans on Mundra expansion, sir, like what are we looking there to expand it?

Ashish Bansal:

Yes. As indicated, in FY '27, we'll be starting up our Mundra project as well.

Moderator:

The next question comes from the line of Naman Parmar with Niveshaay Investments.

Naman Parmar:

Firstly, I wanted to understand on the copper sourcing side. So any difficulty you are facing after the big war between the Middle Eastern countries. So any issue on the copper sourcing you are seeing right now or it's normal?

Ashish Bansal:

So right now, the volumes that we are doing, we are not facing much of issues on the sourcing side. Definitely, there have been, in fact, the sailing days have increased in terms of when the vessel arrives versus by 10, 15 days. But again, since our payments are on CIF basis when the vessels arrive, that does not impact on a payment cycle as well. And we are also further expanding -- we have expanded our procurement towards Southeast Asia as well and looking into aggressively into the domestic markets as well for procurement of copper.

Naman Parmar:

Understood. Secondly, after the full forward integration, how much EBITDA per ton you will be expecting from the copper? Like currently, you have INR 45,000 in the Q4?

Ashish Bansal:

So as of now, the math that has worked out on a very conservative basis, I can say, INR 60,000 to INR 70,000 per ton on the cathode side. But definitely, it would be better because once we have the actual production in hand, we'll be able to drive in efficiencies and definitely have a better margin, but I would like to commit on the lower side.

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Pondy Oxides and Chemicals Limited May 27, 2026 Naman Parmar:

Right, right. Understood. And on the gross margin side, if you see in the current quarter, there was the impact. So it was mainly due to the increase in the contribution of the copper only or it was anything else?

Ashish Bansal:

So if you see on the lead side, it is in excess of 8%, and the copper is approximately around 3.5% to 4% level. And the blended is what is showing at 6.4%. So this -- in this quarter, the copper contribution was almost close to 40%.

Naman Parmar:

Understood. And lastly, on the other expense side. What has happened in the current quarter, it has fallen down Y-on-Y also?

Ashish Bansal:

On the other expense side, in the last quarter, as explained, approximately thats INR 7-odd crores of the mark-to-market was a part of it. And this quarter, that has been utilized and reverses, so that part, we don't see.

Moderator:

The next question comes from the line of Samay Shah with Nuvama Wealth.

Samay Shah:

Am I audible?

Ashish Bansal:

Yes please.

Samay Shah:

Congratulations on a good set of numbers, sir. My question actually was regarding the other expenses only which you explained to the last participant. I mean we were on a run rate of INR 25 crores to INR 30 crores per quarter, which was majorly when our new capacities came online in the past 2 quarters and then it dipped to around INR 18 crores in this Q4. So I just wanted to understand a little bit more on this?

Vijay Balakrishnan:

Yes. As I said, the first part is about the MTM, which got reversed in the current quarter. Apart from that, if you see the expenses when it comes to lead volumes as we said the TKD utilization about 65% level. So we have seen very good efficiencies from each and every line item, P&L like power and fuel. We have reduced environmental expenses, factory expenses, everything has been reduced. So in the coming years to come, the other expenses will be in the range of -- with increased volume as well, it will be in the range of INR 20 crores to INR 25 crores moving forward.

Moderator:

The next question comes from the line of Shivam Dave with MIV Investments.

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Pondy Oxides and Chemicals Limited May 27, 2026 Shivam Dave:

So I had one question was on the trade receivables. Now given that you've had INR 120 crores of -- I mean, that has flowed in April 5, so should we expect that your incremental capacity expansion that you're doing in copper cathode will largely be taken care from that money that you've got in, right?

Ashish Bansal:

I didn't get your question. I mean -- which money that we have gotten? Are you referring to the trade payment?

Shivam Dave:

Yes, correct. The trade receivables that was a point-in-time effect that you got after 31st March?

Ashish Bansal:

Trade receivables is for the products sold for which we were to get our payment.

Shivam Dave:

Correct. So you said that on April 5, you've got INR 120 crores?

Ashish Bansal:

Yes. That also the cash flow part, what I said, if you had received that in time if the delay was not there in terms of vessel movement, we'd have received that before March 31, and the cash flow would have been positive.

Vijay Balakrishnan:

No. What you said was right. Had we received that money probably our -- we would have -- we should have had a reduced borrowing. Otherwise, we should have been invested in the short-term instruments. That is what -- debt would have drastically come down had we received that money.

Shivam Dave:

And the second question was on your overall lead volumes for this quarter. Was there any difficulty in procuring scrap because of the war or was this a conscious decision to kind of produce lesser and improve your EBITDA per ton?

Ashish Bansal:

The war situation was more towards the later half of the quarter, so some of that impact was. It was a conscious decision to sell these specific products in terms of the margin profile.

Shivam Dave:

Because I think you had guided for 120,000 tons of lead for the full year, and I think you've done 100,000?

Ashish Bansal:

We guided to 110,000. Yes. And we achieved almost close to that.

Moderator:

The next question comes from the line of Kaushal Sharma with Equinox Capital Ventures.

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Pondy Oxides and Chemicals Limited May 27, 2026 Kaushal Sharma:

Yes. So my question is on your mostly on industry side, like gradual increase in the BESS capacities and maybe the opportunity of lithium-ion recycling and most of our peers are also going over there. So what is our take on lithium-ion recycling going ahead? Do we have any plan by making any capex at all in that segment? And sir, what kind of this war that is being escalated and 2 months is going to pass. So what kind of impact that could happen in this first half of our business in the sourcing and all because all of the logistic cost has been increased and there is very difficult time going on.

R. S. Vaidhyanathan: Hi. This is Vaidhyanathan here. As regards to the lithium is concerned, we have been constantly keeping an eye on what is happening in the lithium-ion industry. And we have been consulting a lot of technical experts on this, and we are in touch with people and we are busy understanding the feedstock availability and the chemistry that is possible to recycle. And the time of the kind of informal sector dominance in the market and also the collection infrastructure and all that. So we feel that whatever the batteries, the EV vehicle that has been sold between 2018 to 2022, we feel the battery stock might hit the market by 2028. So we thought it's probably since we are focused on various other things, we'll take this up later, yes. But we are on it kind of. Kaushal Sharma:

And what is your take on war situation.

Ashish Bansal:

There has been a little delay in overall receiving of the material, like I said earlier as well, when I was speaking with Shweta that I mean this is -- I mean, most -there has been 10, 15 days, 20 days delay in receiving of the raw material, and that is actually the major impact. On the procurement side, most of our contracts are on CIF basis. And our sales in terms of exports apart from domestic sales, apart from that happening into the Southeast Asian market, where the freight incremental on the outward freight is very marginal when we boil it down to per ton basis, maybe about $ 2 or so per ton on averaged out basis. So that part of it has not impacted. Definitely, yes, in terms of the shipping, we have to be -- I mean the shipping

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Pondy Oxides and Chemicals Limited May 27, 2026 schedules move a little back and forth. So that planning has to be a little more precise and backup plans need to be on that. Moderator:

The next question comes from the line of Abhishek Mehra with DAM Capital Advisors.

Abhishek Mehra:

So I have joined a bit late, so I don't know whether this question was covered or not, but just wanted to have an understanding on scrap formula. So actually, one of your peers highlighted a drop in scrap formula for copper segment, which was highlighted as an industry phenomenon. So could you please just highlight or give some brief on what this scrap formula is for copper and as well as lead? And how does it move?

Ashish Bansal:

Are you referring to the purchase side, are you referring to the sales side drop in...

Abhishek Mehra:

Purchase and sale, both. So, I mean, how does the purchase move and how does the sale move, sir? Is there any difference that is the reason why the margins get impacted?

Ashish Bansal:

Our margins have not impacted. In fact, our margins have improved. I'm not too sure what any other peer has spoken about drop in formula. Are they referring to both sales and purchase. If it's a sales and purchase, it's a whole delta that has moved, so that should not have impacted. But as of what I'm seeing, along with generally if a purchase price goes down, also, the sale price also marginally goes down and vice versa. So it's only a follow-through impact. And the raw material gets little expensive, the sale part also starts getting expensive. It all depends on the demand and supply at that point in time and how you manage your books hedged. If you're managing your books, well hedged. And if you create a delta in terms of your purchase and sale margin, your margins generally should not get impacted. So the impact can be from the volatility on the metal side or from the FX side. If you hedge on both ways, you'll be able to protect your margin.

Abhishek Mehra:

Even when there is high volatility in copper segment, there should be no impact on the margins irrespective of formula?

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Pondy Oxides and Chemicals Limited May 27, 2026 Ashish Bansal:

Irrespective of this thing, you are hedging your position. Formula is based on your metal content, the quality of scrap that you're buying or could reflect to some other terms of your deal. But generally, that is how it is done. And in case if I'm buying something on x price and hoping that the market will go up and does not go up and come down or vice versa, that becomes a speculative trade, which we do not do. So I'm not sure what it's being referred to as in terms of formula drop or any of those sales.

Moderator:

The next question comes from the line of Aayush Jha with Sagun Capital. Please go ahead. Aayush your line has been unmuted. Please go ahead with your question. As there is no response we will move on to the next question it's from the line of Saachi Mittal with Concept Investwell. Please go ahead.

Saachi Mittal:

Am I audible?

Ashish Bansal:

Yes.

Moderator:

Yes, madam.

Saachi Mittal:

My first question is if we see any further increase in the competition in span of like 3 to 5 years, will we see a dip in margins and volumes for POCL?

Ashish Bansal:

You see another 3 or 5, I lost you, madam.

Saachi Mittal:

I'll repeat my question. I see the competition coming up in the next 2 years, will I see a dip in margins and volumes for Pondy Oxides?

Ashish Bansal:

So madam, as we transition through years going forward, definitely, more players would come into the industry like they have come in, in the last 1 or 2 decades. But we need to also remember one critical part that with the energy transition and various infrastructure activities that are happening across the country and the push, our copper consumption is poised to almost go 3x in the next 3 to 4 years from almost close to 1.2 million tons to about 3 million to 3.5 million tons. So also the demand is surpassing your consumption and you do not have the on manufacturing, the margin profiles as long as your products are right and you are able to place them in the right market, right customers, and stay well covered in

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Pondy Oxides and Chemicals Limited May 27, 2026 terms of your both size hedges and all of those, you should be able to protect your margins. Moderator:

The next question comes from the line of Devansh with Anvil.

Devansh:

Am I audible, sir?

Ashish Bansal:

Yes, you are audible.

Devansh:

I just wanted to check, like you've already clarified about the 40%, like we are in this quarter at around 40% utilization of our blended 204,000 capacity. So for Q1, has the utilization moved up already?

Ashish Bansal:

Sir, I think you misunderstood the statement. The 40 and 60 mix was told that the lead sales and copper sales mix for the quarter was 60 and 40 in the overall 100% sales mix, not about the capacity utilization.

Devansh:

No, sir, what I'm talking about is that if you take a 204,000 capacity, right, blended like 204,000 total capacity. So for a quarter, it's about 51,000 and our production is around 20,700 in this quarter. So I'm just calculating based on that, that we've done around a 40% capacity utilization. Is that correct?

Vijay Balakrishnan:

Last quarter, if you see, we have to take a blended capacity. Even Phase 2 first month, January, we started. So it was under trials. And effectively, the Phase 2 capacity was fully utilized in the third month. So overall, if you see 204,000 on a blended basis for full year it is for this year only, we have to count. For last quarter, it is approximately about -- so in TKD alone, it should be taken as 15,000 as the capacity approximately for one quarter. So on that basis, TKD, yes, effectively utilized -- for full year, the blended capacity is what we have to take is about 175,000 metric ton for full year, approximately.

Devansh:

In Q1, have we seen an improvement already?

K. Kumaravel:

Q1 is a forward-looking statement. There is always growth is there in the current quarter. That's what we can say. Beyond that, it's not correct on our part to reveal the numbers.

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Pondy Oxides and Chemicals Limited May 27, 2026 Moderator:

The next question comes from the line of Utkarsh Somaiya with EIKO Quantum Solutions.

Utkarsh Somaiya:

I just wanted to confirm, you said that in FY '27, your lead utilization will be 70%, which is volume of 140,000-odd and copper will be 12,000?

Ashish Bansal:

Yes, that is what we are targeting and looking at.

Utkarsh Somaiya:

And for the FY '28, can you tell me what could be the similar number, approx?

Ashish Bansal:

Year-on-year on the lead volumes, we are looking at about 15% in growth volumes. So accordingly, we will be taking up at that point in time.

Utkarsh Somaiya:

And copper? What about copper?

Ashish Bansal:

Yes. Towards the end of FY '28, we should be able to do a volume of 36,000 tons, close to -- so in FY '28, we can look at anywhere between 28,000 -- 24,000 to 28,000, 29,000 tons of copper.

Utkarsh Somaiya:

24,000 to 28,000. So 12,000 tons in '27 and 24,000 minimum in FY '28?

Ashish Bansal:

On a conservative basis, yes.

Utkarsh Somaiya:

And sir, one more question. Your EBITDA per ton for lead, can we assume you can do 18,500 in FY '27. And for copper, 45,000? Or you think these numbers will be better next year?

Ashish Bansal:

In lead, we'll give you a margin guidance of 17,000 to 19,000 as we've been doing. And on a conservative basis, for copper on the recycling part, anywhere between 35,000 to 40,000 trying to maintain on the upper band. And once the cathode part comes in, right now with our numbers, we are looking at a margin of 60,000 to 70,000 again being on the upper band on a conservative level.

Utkarsh Somaiya:

So we can achieve 60,000 for the whole year in FY '28 in copper?

Ashish Bansal:

No, I specifically mentioned for the cathode part of it.

Utkarsh Somaiya:

So can you give me blended number if possible?

Ashish Bansal:

FY '28, you're asking, yes, FY '28, we can achieve.

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Pondy Oxides and Chemicals Limited May 27, 2026 Utkarsh Somaiya:

60,000 blended number in FY '28, right, for copper on volume was 24,000?

Ashish Bansal:

Yes.

Utkarsh Somaiya:

And lead, same 17,000 to 19,000?

Ashish Bansal:

As of now, yes, for 17,000, 19,000 for lead. If there would be any product mix or something and if we can achieve higher through our value-added products, we'll be targeting to do that.

Utkarsh Somaiya:

So the delta and copper from FY '27 to FY '28 is going to be humongous because your volumes are doubling and your EBITDA per ton is going from like 40 to 60?

Ashish Bansal:

Yes, sir, that's right.

Moderator:

The next question comes from the line of Rushabh with Vinamra Capital.

Rushabh:

Congratulations on a good set of numbers. Sir, one specific question in terms of the Q4 numbers. So we have a purchase of stock in trade and traded goods of about INR 122 crores in the fourth quarter of March 2026. So if you could explain in terms of why there is a purchase of stock in trade and did this translate to a superior profitability in the particular quarterly numbers?

Ashish Bansal:

I'm not sure if you joined in the earlier part of the call. The same question was asked by Mr. Dheeraj and I'll just quickly recap that. This was an opportunity that was available in the market for us and with good margins. So we were able to take it up, and we did the trade.

Moderator:

The next question comes from the line of Gopinath Chenna an Individual Investor.

Gopinath Chenna:

Just would like to congratulate POCL management for a great set of numbers. So I've been following Pondy Oxides for the last 2 years and it's really amazing that whatever you are promising and it's getting delivered. This is -- actually I would like to congratulate for that. So I have a couple of questions?

Ashish Bansal:

We are unable to audibly understand. So could you be a little louder and a little slow.

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Pondy Oxides and Chemicals Limited May 27, 2026 Gopinath Chenna:

Is it better now?

Ashish Bansal:

Yes.

Gopinath Chenna:

Yes. So what I was saying is I've been attending concalls of POCL for the last 2 years and each and every concall, whatever you have promised and it's been getting delivered. So it's actually that is great and I have seen only with a few companies. I'm an individual investor, I can -- I used to attend the different calls, but only a few where I can see what is promised gets delivered. Is it clear, sir?

Ashish Bansal:

Thank you, sir. Yes.

Gopinath Chenna:

Yes, I have a couple of questions. Maybe those are the questions. So the first question is with respect to procurement and sales. Is there any impact because of the Middle East conflict.

Ashish Bansal:

So basically, like I said earlier, the impact is a little bit on time delay in terms of receiving the raw materials, and that is what has impacted majorly for us. And that, again, in terms of our capital or something since we have everything on a CIF basis contract. So there's not much of a pass-through. But accordingly, a little bit on the timing part and all of those, we need to plan a little more in advance. And accordingly, we have also shifted a lot of our procurement to different regions are trying to avoid the Middle Eastern part of it.

Gopinath Chenna:

That's great. And also since in India, right, in last -- especially last couple of weeks, we've been seeing the increase in the petrol and diesel prices. So does it have any impact on our margins going forward?

Ashish Bansal:

Our consumption is in terms of -- we don't use petroleum diesel, definitely use oils and other gases. There is a marginal impact in terms of -- there's a quota, there's a marginal impact in terms of the pricing. And I think that should not be for too long, and it will be a pass-through as we go to our forward months.

Gopinath Chenna:

Okay. And one last question. So if you see in the last Q3, we have -- if I'm not wrong, we got around 8% of margin. But if you see in the last quarter, Q4, we reduced it to 3.5%.

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Pondy Oxides and Chemicals Limited May 27, 2026 Ashish Bansal:

I would again repeat and highlight that the sales mix is different. If you look at the lead part of it, lead is in excess of 8% still even for the Q3 part of it. And the copper sales since copper sales are accounting for about 40%, where the profit - I mean the margin profile is in the range of 3.5% to 4%. And that is why you look at a blended margin of 6.4%. And all the numbers have been maintained in terms of lead and copper individually.

Moderator:

Thank you, sir. The next question comes from the line of Meet, an Individual Investor.

Meet:

Am I audible?

Ashish Bansal:

Yes, sir.

Meet:

Sir, my first question was like what led to the sharp spike in the other noncurrent assets and in the other current assets in our balance sheet?

K. Kumaravel:

The noncurrent assets is mainly GST receivable from the government of India. Mainly that thing, sir.

Vijay Balakrishnan:

See, if you see -- follow on to Mr. Kumaravel, if you see the noncurrent assets, it is the major -- this is due to fixed asset additions that has happened during this year. And in terms of current assets, it is about trade receivables, which is a big pie in the overall current asset. Apart from that, in other current assets, we have about GST receivables and supplier advance for that increase. And if you see the inventories, it is more or less with the volumes, with the revenue, it is more or less in line with the revenue numbers. So the major amount is attributed to trade receivables.

Meet:

And sir, my second question was like in our copper business, our sales volume has increased approx 9x for the current year. Then why is the EBITDA per ton has reduced from FY '25?

Ashish Bansal:

FY '25 was the starting year and the volumes were very low. And at that point in time, only very specific amounts were both purchased and processed and sold. So technically, taking that as a base number for a larger volume would not be a right yardstick. So from the first quarter, we've always given a guidance of about

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Pondy Oxides and Chemicals Limited May 27, 2026 approximately in the range of INR 35,000 to INR 40,000 per ton for copper and that has been achieved. Moderator:

The next question comes from the line of Shweta Dikshit with Systematix.

Shweta Dikshit:

Just a clarification, the copper volumes for the quarter include trading volumes as well?

Vijay Balakrishnan:

In terms of sales, yes.

Shweta Dikshit:

So I mean on a blended basis, we've done INR 45,000 per ton EBITDA then -this is a blended EBITDA per ton for both trading volumes as well as direct manufactured products on the sales volume, right?

Ashish Bansal:

The reason -- like I told Shweta the reason we took up the trade because it was a lucrative trade, and that's why we took it up. And the margin was on the higher side for a trade, and that is why it was taken up by us. Generally, the trading margins are on the lower side. But since we got a higher margin trade opportunity, we took it up.

Shweta Dikshit:

Understood. And lastly, just a clarification on what's the lead volume growth you've guided for FY '27-'28?

Ashish Bansal:

We are looking at growth of about 15-odd percent.

Shweta Dikshit:

In FY '27, so from 100,000, we receive 115,000 tons for FY '27.

Ashish Bansal:

We are looking at from 100,000, and so somewhere around 125,000, 130,000 range levels we are looking at.

Moderator:

The next question comes from the line of Jigar Jani with Nuvama PCG Research.

Jigar Jani:

Congratulations to the entire team for giving such stellar results in such tough environment. Just two clarifications from my side. One, you just said that there is a 40% -- 70% utilization on the 200,000 volume of lead. So that comes to about 140,000. So what -- so what would we should take? Should we take a 30% kind of growth on a conservative basis on 100,000 tons that we have done in last year?

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Pondy Oxides and Chemicals Limited May 27, 2026 Ashish Bansal:

70% was specifically for the newly commissioned unit. In terms of overall, earlier also in a few calls, we had explained the 204,000 includes value-added product capacities and various processing differential. So certain equipments can be used only for certain products. And if those sales are not happening, that capacity is slightly vacant. And the 70%, what we spoke was more for the -- specifically for the TKD plant. In terms of volume, like I just spoke to, we're looking at somewhere around 125,000 - 130,000 tons of volume for this year. And if we're able to push it up, we can -- we will try to reach slightly higher. But as of now, the guidance that we can look at about 125,000 to 130,000.

Jigar Jani:

And sir, this still is a very large volume jump, lead structurally doesn't grow that high. So have we got some new customers getting added next year, which is driving this 25%, 30% kind of lead volume growth?

Ashish Bansal:

Yes, we have added some new products as well and customers as well.

Jigar Jani:

Great, sir. And lastly, on copper, when you add this 18,000 copper cathode capacity, it is not fully backward integrated, right, with recycling. So 12,000 will be the recycling.

Ashish Bansal:

Yes. So 12,000 will be recycling capacity and 18,000 will be -- and like I said, we will debottleneck that and we will scale that up as well to 18,000.

Moderator:

Ladies and gentlemen, that was the last question for today. I now hand the conference over to the management for closing comments.

Ashish Bansal:

Thank you, everyone, for joining us today and for your continued interest in POCL. If you have any further questions, please feel free to reach out to our Investor Relations team at Go India Advisors, and we appreciate your participation and continued support. Thank you, and have a great day.

Moderator:

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

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