Earnings Call Transcript - XNSE:RPTECH 2026-11-06

Operator

Ladies and gentlemen, good day and welcome to Rashi Peripheral's Q2FY27 conference call hosted by Monarch Network Capital Limited. 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 that this conference is being recorded. I now hand the conference over to Vinay Menon. Thank you, and over to you, sir.

Vinay Menon, Head of Investor Relations

Thank you. Good morning, everyone. Today on the call, we have Mr. Kapal Kansari, Managing Director and Conductor of the company, Mr. Rajesh Vinka, Director and CEO, and Mr. Himanshu Shah, CEO of the company. I hand over the call to you, sir. Thank you.

Kapal Kansari, Chairman

Hi, good morning. Good morning, everyone, and welcome to Rashi Peripheral's earnings call for the second quarter and first half of financial year 2026-27. Thank you for joining us. I will cover three things this morning. What we are seeing in the market, how we performed, and most importantly, what kind of company we are building and why we believe it is different. In the first part of the market, India has held up better than most. IDC reported that India's PC market grew by about 12% in the April to June quarter, led by commercial, education, and small business demand, and also by premium and AI-capable notebooks. We should be clear-eyed, though. Part of the strength reflects channel partner buying ahead of future price increase and higher prices are now affecting consumer affordability. We expect commercial and enterprise demand to be a steadier part of the market in the second half, and we are managing inventory and credit accordingly. The second part of our performance is On a consolidated basis, revenue for the second quarter grew by about 48.8% year-on-year, with PAT and EBITDA margins more than doubled. For half-year, revenue grew by 54.5% with EBITDA and PAT margin trends doubling. Our CFO will share more details in the later part of the call. To put it that in perspective, in the first six months, we have earned more than 80% of our profits we earned in the whole of last year. The quality of that profit matters as much as its size. Gross margins improved by close to 100 basis points in the quarter. So the expansion is coming from mix and pricing discipline, not only operating leverage. Annualized returns on capital employed and return on equity were both close to 23% for the quarter and highest since our listing. And working capital days also improved to 55 for the half from 61 a year ago. I also want to be direct about two numbers you will see in our balance sheet. Operating cash flows for the half was negative, and net debt to equity rose to 0.76 times. Both reflect deliberate choice. We built inventory to secure supply in a constrained market and to committed enterprise and AI projects. We also funded VDA acquisition through this. Converting that cash inventory into cash in the second half is a priority, and we will report on our progress next quarter. On the third piece, what makes Rashi different, is now the question that I think most of long-term investors are interested. First, we are an Indian company by choice. All of our capital, management attention, and network are focused on one market, the market with longest runway in technology adoption. We carry no geopolitical drag from distant geographies, and every rupee we invest goes where our customers are. Second, our profits grow faster than our revenue. This quarter profit grew to roughly two and a half times the rate of revenue, and this is a trend, not a single quarter. In a business often described as low margins, we have built a margin profile that we believe is among the strongest in Indian technology distribution. The third part, we choose depth and breadth in tandem. We work with 89 global brands, each of whom we can be genuinely meaningful for. Our branch head structure keeps decisions close to the customer, and our 57 branches 50 service centers and 728 locations reach deep into Tier 2 and Tier 3 India, where penetration is lowest and growth is highest. Fourth, we are building engineering capability, not only resale capacity. In semiconductors, our field application engineers work with manufacturers at the design stage, so the components we supply are designed into their product for the years. Our joint venture with Restart Corporation adds Japanese design expertise and a dedicated engineering team in India. That is a capability few distributors have in India. And the last fifth, we are now one platform with three engines. We distribute through our core ITC business. We integrate through our VDA solutions in which we have acquired A 67% stake, bringing system integration. Cybersecurity, cloud, and managed services. And we enable through our embedded and semiconductor business. Each engine draws on the same channel relationship and customer access, which means a larger share of each customer's technology spent at higher value without a proportionate increase in acquisition cost. Lastly, our priorities for second half are clear. Convert inventory to cash and bring working capital back towards our historical levels. Integrate VDA carefully and retain its people and client. Build the leadership and engineering team for semiconductor joint venture. This will keep growing our core faster than the market while protecting margin and credit quality. We remain cautious on consumer demand. and disciplined on credit. As a closing note, we will continue to give investors a clear and balanced view of both opportunity and challenges. With India's digital infrastructure expanding and demand for AI, cloud, and semiconductor growing, we are focused on sustaining growth while improving the quality and breadth of our earnings. Our aim is to build on this quarter's record performance and continue Rashi's evolution into a trusted integrated technology solution partner. With this, I would like to hand it over to Mr. Rajesh Goenka, our CEO, who will take you through the key operations highlights for second quarter and first half of FY27. Thank you.

Rajesh Goenka, CEO

Thank you, Kapal. First of all, let me get into the details. Let me now get into the details. During the period under review, which is Q2 and H1, We continue to strengthen our core ICD distribution business while expanding our new growth engines. Our focus remains on solution selling, deeper customer engagement, and very importantly, increasing the wallet share across our 10,280 channel partner ecosystem, which is spread across 728 towns of India. We also continue our transition towards an integrated technology solutions provider, building across ICT distribution, managed services, and embedded and semiconductor solutions. We expanded our enterprise technology capabilities through the acquisition of VDA InfoSolutions. VDA's expertise across enterprise IT, cloud infrastructure, cybersecurity. System integration, and manage IT services will support our move towards higher value, solution-led offerings, and create opportunities to deepen customer relationships. We also formalized the joint venture with Japan-based Restar Corporation to establish a dedicated semiconductor and embedded solutions business. The partnership combines their technology expertise with our distribution network and customer relationship and will develop local design and engineering capabilities, talent transfer, and technical services for the Indian market. We also conducted artificial intelligence bootcomps across six metro cities, and we had overwhelming participation of almost 150 customers at each location, helping enterprise partners and customers to build AI capabilities in the accelerated computing, AI workstations, and enterprise AI workloads. Along these initiatives, We continue to expand our branch operations and strengthen pan-India reach and the last-mile access, particularly in the Tire 3 and Tire 4 towns of India, which are also the emerging commercial hubs. We remain focused on product availability, supply chain efficiency, deeper engagement with our OEMs and our channel partners. It's our endeavor to continuously strive to achieve continuous improvement on this. With this, I would like to again thank you and wish all of our investors a happy Deepawali. Thank you, everyone, and I would now request our CFO, Mr. Himanchusha, to brief on the financial performance about the company.

Himanshu Shah, CFO

Thank you, Rajesh. And good morning and festival greetings to everyone. I will now take you through the financial performance for the period under review. We delivered our highest ever profits for both Quarter 2 and H1 FY27 on a standalone and consolidated basis, reflecting strong growth across our businesses and continued progress in building a broader technology solution platform. On a standalone basis, revenue from operations for the quarter grew by 42% year-on-year. to INR 5708 crores. EBITDA increased significantly 96% year-on-year to 196 crores, with margins expanding 95 basis points to 3.44%. PAT rose exceptionally by 172% year-on-year to INR 153 crores, with PAT margins improving 128 basis points to 2.68%. For the first half of financial year 27, standalone revenue from operations grew by 49% on year-on-year basis to INR 10,540 crores. EBITDA reached to INR 345 crores, reflecting a robust growth of 71% on YOY basis, with margins improving 42 basis points to 3.28%. Pat grew significantly by 117% year-on-year to 250 crores, and Pat margins expanded 74 basis points to 2.37%. On a consolidated basis, revenue from operations for the quarter grew by 49% year-on-year to INR 6185 crores. EBITDA increased significantly by 112% year-on-year to 220 crores, with margins expanding 106 basis points to 3.56%. Payet grew exceptionally by 121% year-on-year to 131 crores, while payet margins improved 69 basis points to 2.11%. For the first half of the financial year 2027, consolidated revenue from operations increased by 55% year-on-year. To INR 11,287 crores, EBITDA reached to INR 375 crores, reflecting a strong growth of 81% year-on-year, with margins improving 49% basis points to 3.33%. PET increased by 95% on year-on-year basis to 225 crores, and PET margins expanded 43% to 2.08%. We also improved our working capital efficiency during the period. Working capital days improved to 55 days from 61 days. Debtors' days reduced to 43 from 46, and creditors' days increased to 44. With this, I would like to hand it back to Moderator and open up for question and answer session. Thank you so much.

Operator

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 your 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. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Hitesh Coin from Origin Capital. Please go ahead.

Hitesh Goel, Analyst — Origin Capital

Yeah, thanks for taking my question, sir. Two questions. First, related to this inventory buildup in this quarter. So, you said that consumer demand is a soft name. So, why have you built such a strong inventory in this quarter? Second question is on the QIP provision. So, it's a big dilution on current market cap around 15%. So, is it related to acquisition or is it business related? Can you give us some sense on that?

Rajesh Goenka, CEO

Yeah, Hitesh, so I will answer the first question about the inventory built up. While, because of the continued price rise, there is a possible contraction in the consumer market, but the commercial market continues to grow very strong, which is almost 70% of India's total ICT market. So, in short, the impact so far is minuscule. That's point number one. Second, the major reason is because of the Deepavali season change. Last year, if you remember, the Deepavali in 2025 was around 20th of October, and this year it is on 8th of November. So, therefore, the cycle, entire cycle, there is a delay of one month. And that is the reason we had to build the inventory towards end of September and entire October, while saying so, the sales have been good in October, very good in October, and it continues to happen in the current week as well. So, there is no worry on the inventory front as such.

Kapal Kansari, Chairman

Hi, so with regards to the QIP, yes, you are absolutely right. That this QIP preparation is a little we're doing as an advanced preparation for growth engine. When you're continuing to grow at about 40 to 50 percent, 60 percent, quarter, year over year, every quarter, this will require at some point in time growth capital in terms of building capacity. Now, this, having said this, it is only a free... And in case we do not need this growth capital, we probably may not do a QIP at all. But as a practice, we do not want to be constrained with capital when the growth opportunity presents to us in the coming times.

Hitesh Goel, Analyst — Origin Capital

Just a clarification there. So, you know, previously, I think management had said that if we reach our 25,000 crores turnover, at current levels, we don't need any capital. So, that holds, right? And you're already at that level now in terms of quarterly. Right? So, this 900 crores basically will reach what kind of, you know, turnover in terms of what kind of turnover can you achieve if you raise kind of funds.

Kapal Kansari, Chairman

Yeah, so good question, Hitesh. I think the principle remains the same. With every capital that we raise and managing a one-to-one debt-equity ratio, this will give us an incremental deployment capacity of about 1,800 to 2,000 crores of deployable capital. With six to seven times of working capital cycles, this will about 12,000 to 15,000 crores of additional revenue is sustained, will sustain on an immediate basis. Now, the entire role is not going to come in one year.

Hitesh Goel, Analyst — Origin Capital

I got it. Just a suggestion there. I think it would be prudent to do it in a calibrated manner rather than putting a 900 code number with a 15% dilution. That is not looked at very well by the market because we understand the capital needs, but it could have been done in a calibrated manner. That's my suggestion. Thanks a lot, sir.

Kapal Kansari, Chairman

Your feedback very well noted, Adesh. Thank you for your note. Mm-hmm.

Operator

Thank you very much. The next question is from the line of Tanah Desai from 11th Advisors LLP. Please go ahead.

Taneer Desai, Analyst — 11th Advisors LLP

Good morning, and thank you for the opportunity. We continue to remain long-term investors. The question for management is twofold. One is, what will be the sustainable EBITDA margin by FI29, FI30 once the full CapEx utilization is complete for the 900 crore raise, if at all you choose to raise? Second question, which all investors are looking forward to hearing This is the macroeconomic landscape view. Especially the AI trade that is currently unwinding in the western part of the world. How does that affect our company? And what will be the dependency on AI-related products over the next 3-4 years? If the management can give a guidance on the mix in the next 3-4 years, that would be very helpful. Thank you so much.

Himanshu Shah, CFO

Tanay, on the first question of sustainable EBITDA margin for the period you mentioned, 29 and 30, I would like to... Say that, you know, around 2.75% EBITDA margin is a safe bet to, you know, consider for such long-term horizons. Second question.

Rajesh Goenka, CEO

Yeah, Tane, on your question about the macroeconomics of this business, so first and foremost, as we all know that in India, overall economy is doing pretty well. And we are hoping that it will continue to do well. Second, digitization across all the sectors of business education continues very aggressively, which helps our business. Third, all third-party reports indicate that India conservatively, industry will continue to grow at least in early double digit or 10 to 12 percent on unit-wise. Fourth, the price rise, although it is slowed down, but it is expected to continue to some extent. So all these macro conditions are. However, we are not limiting our focus only on macro things. We have simultaneously done the acquisition of VDA. We have simultaneously done the joint venture with Restar Corporations. And all these businesses, even in the first quarter, have started already moving. And last but not the least is about the AI. I would say that while South Korea and Japan and other countries, there has been some collapse even today on AI front, India, that way, you know, we are all, we play very safe. So AI usage or implementation in India is at a very, very nascent stage. We are already not into that volume. The probability of any crash is very remote, and we see good opportunity even on AI front in India for at least... It helps us to have an accelerated growth, which is evident from our H1 to H1 growth. If you see, we have almost 50% growth on a YOY basis without doing any major project business.

Taneer Desai, Analyst — 11th Advisors LLP

Thank you. Thank you so much, sir. I think last bookkeeping question would be the interest cost estimate given the new debt levels for maybe FY28, if not beyond. That would be all from my side. Thank you.

Himanshu Shah, CFO

So, interest cost estimate like H1 has given the trends, and since it includes the interest cost on the acquisition debt also, which we obtained, So, we gave guidance of the interest costs remaining in the same range.

Taneer Desai, Analyst — 11th Advisors LLP

Thank you, and we truly appreciate the promoter sentiment as well, given the stake increase. We hope that the trend continues, and we hope the company continues to do well over the next three to four years. Thank you.

Rajesh Goenka, CEO

Absolutely, we will together.

Operator

Thank you very much. Ladies and gentlemen, in order to ask a question, please press star and one on your touchtone telephone. I repeat, in order to ask a question, please press star and one on your touchtone telephone. The next question is from the line of Karan Kamdarshan Choice Institutional Research. Please go ahead.

Karan Kamdarshan, Analyst — Choice Institutional Research

Good morning, happy to be here, and congrats on a great set of numbers. Sir, if you could explain how the business grew this quarter in terms of volume, price, as well as VDA and VDA, that would be helpful.

Rajesh Goenka, CEO

Could I get your name, please?

Karan Kamdarshan, Analyst — Choice Institutional Research

Karan Kamdarshan.

Rajesh Goenka, CEO

Good morning. Okay. Hi, Karan. So, if you ask me very discreetly, our 50% growth can be very simply dissected in 30% growth has come from the price increase, which is the trend. 10% to 11% has come from the volume increase, which is the unit increase, and 10% has come from new businesses. So, that's the broad break-up of our growth engine. However, to your question about VDA, we've just added Q2 revenue of VDA, which is at this moment very small, less than about 2% only. So, it's not very significant at this moment.

Karan Kamdarshan, Analyst — Choice Institutional Research

On an EBITDA level, sir?

Himanshu Shah, CFO

A bit of a level, the new initiatives are adding around... Six weeks, because it was first quarter only. And then, like, one initiative, like, one month only, that's why.

Karan Kamdarshan, Analyst — Choice Institutional Research

Okay, one month only, got it. What is, sir, where do we see factors both coming in outside of the traditional design? Semiconductor or semi-system integration? And what prospects and times do we have for expanding system integration?

Rajesh Goenka, CEO

Can you repeat your question? The voice was not very clear.

Karan Kamdarshan, Analyst — Choice Institutional Research

Sorry about that. I hope I'm audible now. So, the question was, where do you see faster growth coming in in terms of contribution to EBITDA, VDA, or the semiconductor business? And what are your plans for expanding the semiconductor business?

Rajesh Goenka, CEO

So, as I mentioned, the VDA business was only added in Q2 and semiconductor. We just had one month. Going forward, we will have the full quarters and entire H2 will be there. We plan that they should contribute to more than 10% of our top line, and bottom line anyway is more than 2x. So that also will get added. And next financial year, both these businesses will make a major positive impact on our revenue margins and EBITDA numbers.

Karan Kamdarshan, Analyst — Choice Institutional Research

Thank you, and all the best.

Operator

Thank you very much. Ladies and gentlemen, in order to ask a question, please press PAN1 on your touchtone telephone. Thank you. The next question is from the line of Aegis Lakhani from Unify AMC. Please go ahead.

Aegis Lakhani, Analyst — Unify AMC

Yeah, hi, team. Congrats on a strong set. I have three questions. Question number one is, you know, again, This is a fairly seasonally strong quarter for us, and given the outline that you mentioned that V-Day was just mentioned for one month, I'm trying to understand the margin resilience, to be very honest. How much of this is value-led? How much of this is volume-led in terms of, you know, the growth that you have seen? And I'm trying to really understand how you're able to squeeze out so much margin. So it's a little surprising for me. So can I request you to respond on this, and I'll come back to the subsequent two.

Rajesh Goenka, CEO

So your question is about the margin resilience, right?

Aegis Lakhani, Analyst — Unify AMC

So, partly, yes, it's a seasonally strong quarter. I'm trying to understand that X of VDA. How are you able to get these kind of margins? That's point number one. And is this margin performance been more because, you know, is it more value-led because, you know, you've had, you know, the pricing has been increasing and you've been able to retain some of that. I'm just trying to understand the semantics behind it.

Rajesh Goenka, CEO

Yeah, so basically there are three factors. One is the overall demand continues to be strong. Second, pricing, as I said, already contributes 30% of our growth. So when the demand is high and the pricing continues to be higher, then there is less bloodbath in the market and there is a chance to earn a little bit more margin. Second, for Rashi peripherals, as we all know, that more than 35-37% of the business is non-PC. Predominantly, accessories, peripherals, CPUs, motherboards, hard drives, all these places, we always have an opportunity to... On some extra margin. So with our strong network across 57 branches, with our team structure and KPIs, which are defined also on the margins, we are able to garner some extra margin across these product categories. And to answer your point for near future, is it sustainable? My answer is definitely yes.

Aegis Lakhani, Analyst — Unify AMC

Understood. Second, sir, we've read about Aristar and your joint venture there, and the website's fairly there, so we're able to scroll through the products, etc. But could you speak a little bit about how, because it's a large entity with large revenues, probably amongst the largest. You know, amongst the largest in the world. So I'm just trying to get a sense that what does that JV really bring for you on the table? Who are their constituents? Will you be exclusive for them? More color and more depth and more perspective again on Arisa. Thanks.

Rajesh Goenka, CEO

Absolutely, Ajis. So, Raystar Corporation, it's a Japanese semiconductor distribution company. It's a $4 billion Japanese conglomerate. They are like us only, but they are focused only on semiconductor business and more focused on design and supply both. We have had this joint venture with them. To pick up the market opportunity in India, which is currently distribution, semiconductor distribution market opportunity in India is currently estimated at about 25,000 crores. So, together we want to get a share of this market. What are we going to get from Raystar when we do the JV? There are three very clear identified things. First and foremost is the products. That they are distributing in Japan. Two very big Japanese brands have already come under our fold, and starting this month, we are going to distribute those brands. So that is the one. So our basket of products have already started increasing. Second, Ristar has a very strong design capabilities. They have 200 engineers in Tokyo. So, we also want to develop similar design capabilities in our Bangalore laboratory under their guidance. So, they are also deputing one engineer in Bangalore to train and develop a design center. And third is equally important is... Today for Rashi Peripherals, our semiconductor business, we don't have a single Japanese manufacturer as a customer in India. Example is Maruti or Daikin. There are so many Japanese manufacturers. By virtue of having a JV, the first level of discussions have already started and even in this month we are meeting five Japanese manufacturers in India. So all these also now potentially will become our customer. So, in short, first, we are getting new products and lines offering. Second, we are getting design capabilities. And third, we will be able to penetrate to the Japanese manufacturers in India. So, these are the three core things that we are looking from the JV.

Aegis Lakhani, Analyst — Unify AMC

Understood. And Rajesh, your follow-up on that. So, is it that these new... Product OEMs who are, you know, core to restart globally, does that mean you have exclusivity with them? Is it possible to call out some of their, who are these, you know, OEMs who are, where you have the exclusivity? Have they already got distribution partners in India? Is this a new, are you a new distribution partner through this JV or is it exclusive? Could you call out a little more color on this, Thaksin?

Rajesh Goenka, CEO

Yeah, AJ, since it is not yet formalized, I cannot announce the names, but I can say that two names is there on virtually every Indian. It's a Japanese manufacturer. And to clarify to that, it necessarily may not be exclusive. There could be some Japanese distributor already serving in India directly or indirectly. It could be a mix of exclusive and non-exclusive both.

Aegis Lakhani, Analyst — Unify AMC

Understood. So, if there are Japanese distributors who are already, you know, distributing those company products, and we are also entering the same domain, Are you seeing it as a market expansion opportunity and the market is underserved by these distributors? What is it that you will be able to bring? You have distribution muscle and reach, which I understand. So what does it enable, really?

Rajesh Goenka, CEO

So, first and foremost, in our assessment, their market's reach currently is only 10% of the overall opportunity. So, 90% is not catered to. Second, they majorly do only dollar billing either from Japan or Singapore or Hong Kong. Third, with our reach, with our technical expertise locally, spread about 57 cities of India, we can do local support, we can do local design, we can do local billing, we can do post-sales support, all these things we bring on the table. So, that is the bigger opportunity, and as I said, 90% is unserved, which we can do it. And that's the opportunity for us.

Aegis Lakhani, Analyst — Unify AMC

Understood. And typically, what are the margins in this segment? Is it better than company-level margins, materially, and how do you see the revenue scale-up here?

Rajesh Goenka, CEO

Broadly, it is 2x. Broadly, it is 2x on margin front. As far as top line is concerned, Last year, last financial year, Rashi alone in semiconductor, we did about $20 million of business. What I can say right now is in just first six months of the year, we have done 2x of the last year number. So this entire, this financial year, we are hoping to do 3 to 4x of last year financial numbers. So that's the trajectory of business that we have currently.

Operator

Thank you very much. The next question is from the line of Mathur Ratty, from Counter Cyclical Investments. Please go ahead.

Madhur Ratri, Analyst — Counter-Cyclical Investments

Sir, thank you for the opportunity. Sir, personally, I wanted to understand how should I look at the pricing scenario of our products? Sir, do we expect any price correction since there is a lot of talks regarding this AI bubble boosting and probably the demand for chips and storage should get better than what it is right now. So, in that scenario, how should we look at our business if you can help us understand?

Rajesh Goenka, CEO

Yeah, so Madmoor, if you see, as I have already mentioned, First six months of the year, our growth 30% is attributed to the price increase. However, H2, the growth, what I anticipate would be about 10 to maximum 15% will get attributed to price increase. So that's the broad number indication I can give you. In the product categories, DRAM particularly, which is the core. The reason for price elevation, the forecast is that it will continue to grow even at least in next one year. Although I see SK Hainé-Samson stock prices already dropping, but the trend that we are told is going to be only on increasing. On the flash and hard drive storage, the prices have more or less now flattened. So, on an average, in H2, we still expect 10 to 15% price increase.

Madhur Ratri, Analyst — Counter-Cyclical Investments

Got it. And sir, the second question was on our debt-to-equity. Sir, we were always of the post-listing that we would like to keep it one-to-one. So, how should I look at going forward since the working capital requirements of our business has increased due to these price increases and till the time maybe the fundraise comes, where should we expect that? Would we like to lever our balance sheet further or how should we look at the debt-to-equity?

Himanshu Shah, CFO

Yeah, so debt equity, as we maintain that we would like to go up to one is to one, barring opportunities where ROC makes sense or not for the temporary phase. Otherwise, on broader scenario, it will be one is to one only. Currently, the 0.76, which is their net debt to equity, that includes the acquisition debt also. So that much you can take as incremental.

Kapal Kansari, Chairman

To add to you, Madhur, it's a very simple outlook. To fund the growth, either by way of acquisition or by way of the general distribution growth, there are three pillars of growth. There's a core distribution engine, there's a semiconductor segment, and the other one is managed services and enterprise infrastructure related services on the IT piece. Economics and the financials of the organization, we will take that call.

Madhur Ratri, Analyst — Counter-Cyclical Investments

Got it. And so just one final question from mine, sir, how is the enterprise deals on the data center front panning out? Are we in discussions or do we expect some major deals in the pipeline? That was for me. Thank you so much.

Rajesh Goenka, CEO

Yeah, so being the first mover in the AI data center space, we are there in almost every project. But at this moment, while we speak, In that segment, because we already have 50% sustained growth for last almost so many quarters. And needless to say that these are large-sized projects where the exposure values are also big and the ROIs are also less. So, considering our 50% growth, we have... We are away from these projects, but we are stable. Always jump and start winning the orders.

Madhur Ratri, Analyst — Counter-Cyclical Investments

Got it. Sir, thank you so much and all the best.

Operator

Thank you very much. The next question is from the line of Jagruti from Clockwine Capita. Please go ahead.

Jagruti, Analyst — Clockwine Capital

Hi, sir. Thanks for giving me an opportunity. My questions have already been answered. Thank you.

Operator

Thank you very much. The next question is from the line of Dheeraj Kumar Reddy from Alpha SQR. Please go ahead.

Dheeraj Kumar Reddy, Analyst — Alpha SQR

Hi, sir. Thanks for the opportunity. My question is, basically, if you're saying that, you know, next second half, we'll have like a 10 to 15% price. And if we can 10% from new initiatives and 10% from the volume, I'm just trying to understand now the company seems to, you know, get into an orbit of where I think the growth rates probably can be beyond 30% for the next couple of years. Is that assumption true or like are we missing out something here?

Rajesh Goenka, CEO

It's very difficult to estimate for next year and next to next year because price trends are... And we are seeing price flooding already. But what we are saying is on the macroeconomics, overall Indian economy continues to grow strong. Digitization continues to grow strong. Education continues to be strong. Businesses are thriving. All these continue to drive the demand for PC, PC-related accessories and the entire ecosystem. So in India, next few years, we very clearly see that opportunity will only keep on accelerating. And with Rashi Peripherals, continued improvement in penetration beyond 57 towns of India and 700 towns of India billing, all this, we are ready technically to grab those opportunities. So, I think that is a better answer to your question, Dheeraj.

Dheeraj Kumar Reddy, Analyst — Alpha SQR

Understood, sir. And my second question is basically our new business, which is enterprise and semiconductor, because on the lower base, and also you seem to be very optimistic on the growth. I just wanted to understand how large these businesses can become probably in the next two years, and what are the fundamental, I mean, business, I mean, drivers for this growth.

Rajesh Goenka, CEO

Enterprise business, the opportunity is very huge. It all depends how much we want to pick up and at what cost. I think someone already asked, I think Madhur already asked me that on the AI data center, what are we doing? To the best of my estimates, last one quarter itself, more than 20,000 crores of orders have been placed. But there we chose not to play a very active role because our growth was already at 50%. So, and overall opportunity size is already is very high. How much we want to take, but broadly speaking, from Rashi perspective, this year and next year, we want to be around 20% business should come from enterprise so that our existing business strength that is there, that does not get defocused and does not get... So, we want to keep on strengthening our key strengths of businesses that we have developed in the last 35 years and keep on adding building blocks like enterprise, like semiconductor. So, enterprise, I think, next year should be about 20%. And semiconductor is just the start with the JV, but it will be a substantial in terms of… Top line, and more importantly, on the bottom line as well.

Dheeraj Kumar Reddy, Analyst — Alpha SQR

Got it, sir. Thanks a lot.

Operator

Thank you very much. Ladies and gentlemen, in order to ask a question, please press star and 1 on your touchtone telephone. I repeat, in order to ask a question, please press star and 1 on your touchtone telephone. The next question is from the line of Vinay Menon from Monarch Network Ltd. Please go ahead.

Vinay Menon, Head of Investor Relations

Hi, sir. Thank you. A couple of questions. Intangibles on the books have increased in the balance sheet. This is attributable to the VDA acquisition, and how are we expected to take this now over the next few years?

Himanshu Shah, CFO

So, the intangibles which have been increased, yes, part of this is on VDA acquisition, which is in the cursor balance sheet. Thank you. As far as treatment of these are concerned, these have different components out of it in terms of customer know and goodwill. So, goodwill is, you know, almost not more than 20% of the total intangibles, and it will be treated in line with the accounting principles and income tax rules which are applicable.

Vinay Menon, Head of Investor Relations

Secondly, on the AI species, sir, how is the outlook? How are we seeing some pickup in that segment? And we are expecting some new launches in Edge 2 from most of the large OEMs in association with NVIDIA. So, what are the expectations for those launches?

Rajesh Goenka, CEO

So for India perspective, since we have a very small base, On AI, on the commercial applications, and also the enterprise and data center applications. So, there are a lot of projects announced, and they are at a various stage of finalization. So, at least next one to two years, we see the opportunity is very, very big. It's up to us now to define this. Finances and ROC calculations. But opportunity is very high for next two years, for sure. Yeah, so the conservative forecast for H2 will be that consumer business, there will be a degrowth in terms of unit-wise. Commercial business could be flat or positive. My sense is it is going to be positive because January, February, March is a corporate quarter, especially year-end. Budgets are there, depreciation is there. So, overall, unit-wise, H&M is going to be flat. However, for Rashi Peripherals, we continue to expand into new product lines, new vendors, new customers, and new territories or towns, I would say. Apart from this, VDA and RestarJV will also add value to our top line and bottom line. So we see a sustained growth engine in H2 as well.

Vinay Menon, Head of Investor Relations

And one last question, you know, a lot of people are looking at ASPs and are kind of worried that, you know, whenever the supply issue goes off, the ASPs might fall and maybe that will impact our revenues negatively. So, you know, being in the industry for so long, and I'm sure investors have seen trends like this, has there ever been, you know, price cuts which have come and maybe impacted growth from a distribution angle for us?

Rajesh Goenka, CEO

Yeah, so post-COVID, COVID situation was something similar, where there was a shortage and price went up, and post-COVID, the prices dropped by 10 to 15%. So for a year, there was some flip across the market. But from distribution perspective, it does not make too much of a difference because in distribution, you continue to expand into new products, new territories, new customers, new cities. So those gaps normally get covered. Honestly, do not remember, post-COVID, we grew, I think, by 7%, whereas the market de-grew by about 15%. So, because we are into distribution business, we are able to cover from other business opportunities that are there.

Kapal Kansari, Chairman

And additionally, Vinay, please remember that we are building semiconductor and the services portfolio, enterprise services portfolio. Considering the lower penetration that they exist in the market. So the upside is much larger to offset any such reverse trend that happens in the distribution space.

Vinay Menon, Head of Investor Relations

All the rest of the day.

Operator

Thank you very much. The next question is from the line of Vavan Chedda from In-Arm Holdings. Please go ahead.