SRF Limited (SRF) Q4 2026 Earnings Call Transcript

Ladies and gentlemen, good day and welcome to SRF Limited Q4 F526 Conference Call, hosted by ICICI Securities 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 Mr. Sanjay Shain from ICICI Securities. Thank you, and over to you, sir.

Thanks, Ikra. Good morning, everyone, and thank you for joining us today. We at ICICI Securities are pleased to host SRF Limited's Q4 and FY26 results conference call. We have with us Mr. Ashish Bharatana, Chairman and Managing Director. Mr. Samir Kashal, President and Chief Financial Officer at SRF Limited. I would now like to invite Ms. Nitika Dhawan, Head of Corporate Communication at SRF, to initiate the proceeding for the results consult. Thank you. Over to you, ma'am.

Good morning, everyone, and welcome to SIRF Limited's Quota 4 and Financial Year 2026 Results Conference Call. We are pleased to have you join us today. On the call, we have our Chairman and Managing Director, Ms. Ashish Paragraam, along with our President and CFO, Ms. Samir Kashuk, and Ms. Ogunra Singhal, Senior Vice President, Treasury and Investor Relations. To begin, our CMD will share insights into the company's performance during the financial year 2026, Followed by an overview of our strategy, business outlook, and growth plans. After these remarks, we will open the floor for a Q&A with our CFO and Aya Shed. Please be reminded that any statements made regarding our outlook are forward-looking and are covered by the schema included in the earnings presentation shared with you earlier. Without further ado, I invite our CMD, Mr. Ashish Paratra, to deliver his opening remarks.

Thank you, Nikita. Good morning to all of you. I extend a warm welcome to you and thank you for joining us today for the earnings call. I trust all of you have had the opportunity to go through our results and the presentation shared with you earlier. The global operating environment remains defined by volatility, uncertainty, and complexity, a true VUCA world. Compared to this time last year, conditions have not materially improved. If anything, they have become more challenging. Persistent geopolitical tensions, particularly the ongoing conflicts in the Middle East, have continued to disrupt. As a company operating in clinical intermediates, we have felt the impact of these disruptions across logistics, supply chains, and market access. Having said that, the company has made tremendous efforts in finding answers to the challenges that we are facing. I believe that we will navigate through these due to the resilience of our team. Our focus has remained firmly on discipline, execution, operational excellence, strategic investments across our businesses. Let me now share with you my thoughts on the business performance It's in the fiscal year gone by. 2026 unfolded against a challenging backdrop, testing resilience while opening avenues for long-term growth. During this period, SRS revenue increased by 7% to 15,787 crores compared to the corresponding period last year. The company's operational event rose by 29% to 3,008 crores over the year. The one thousand eight hundred thirty five. This has been our second-best performance on an overall basis in our history. I'll begin with the chemicals business. During the fiscal year, 2026, the chemicals business achieved a 16% increase in revenue. In fact, it in the fourth quarter. We have developed new markets, and I am hopeful that in the near future, the Middle East situation will improve. SRF is a leading global clear in HFCs and HFC blends. We are undertaking incremental capacity enhancements to strengthen our market position, aligned with the potential HCFC quota under the Montreal Protocol. The required environment clearances are already in place, as communicated earlier. This will take our HFC capacity beyond 65,000 metric tons per annum. Last year, we spoke about our investment in the next generation reference gases. Based on the tremendous work done by in-house technology team, I'm pleased to say that we have developed a global benchmark process, both on capital and operating expenditure side, that will be non-infringing. In view of the anticipated transition to the next generation gases and the interest shown to us by potential customers, the board has revised the CAPEX approved in October 2024. We will now be investing approximately 2,300 crores at our new site in Odisha over the next two years. This investment envisages fourth-generation gas capacity of 20,000 metric tons per annum and includes backward integration into 30,000 tons of hydrofluoric acid along with investments in electronic-grade hydrofluoric acid. The product mix will comprise HFO-1234 wire, HFO-1234 ZE and HFO-1233 ZD. This reinforces our strong commitment to building a globally significant refrigerant gas business. I am also proud to state that just as we did with the launch of our HFC many years ago, our investment in the HFO portfolio will ensure that India remains self-reliant in this critical segment. The chloromethane segment delivered stable performance during the year. In flora polymers, sustained efforts to ramp up PTFE capacity have begun to yield positive outcomes, including key account approvals from leading global customers. to note that our investments in specialty fluoropolymers are progressing as planned and represent a meaningful long-term growth opportunity. To support the strategic direction, we have further strengthened our leadership and technical teams by onboarding experienced industry professionals, enabling a continued move of the value chain. I believe that we will see a significant change in the product mix. Most companies are progressing well, and we expect to complete this high-margin project on time. In my view, this investment is the start of a relationship that can develop into a far more significant opportunity. Thank you. In the chemical business, the year was marked by stress in the innovative agrochemical value chain and muted outtake of impacting demand visibility. Pricing pressure was seen across the value chain with aggressive participation from Chinese players, impacting both our markets and customers' end markets. Even in this environment, we were able to sustain our business base to a continued focus on cost control, operating efficiencies, and disciplined execution. Our approach has been to defend market share in a rational manner and avoid losing business to overseas competitors. As we believe, industry pricing will normalize to more sustainable levels over time. I would like to take this opportunity to also share my perspective on how I see the macro elements of this business. The pricing of a speciality product over time will always move to a more commoditized level. There have been a lot of questions over the drop in pricing for DFPA. While pricing levels may have reached unsustainably low levels, we continue to generate healthy returns through ongoing process improvements and technology interventions implemented over time. The key for this business is to ensure a strong pipeline of intermediates and AIs which can replace high-impact molecules such as DFPA. Today, our pipeline remains extremely robust across both AIs and intermediates which have the potential to replace products like DFPA in its early stage. Our focus on this segment continues, and while we will grow our agrochemicals business, we remain committed to scaling up our pharma segment faster and increasing its share in the overall portfolio. Against this background, we have our pharma intermediaries plan number two coming up. Moreover, our pipeline of molecules has expanded meaningfully over the past year. Importantly, we are moving up the value chain with participation not only in key starting materials, but also in regulatory starting materials. That said, as is typical in this industry, the pace of commercialization will depend. On a customer's product last night. Thank you. While the complexity increases and development timelines continue to compress, CTG has strengthened its capabilities and supports systems to remain future-ready. Everybody's covered over 51. Thank you. Thank you. SRF dedicated R&D facilities. We're not coming to the business. We should be able to deliver growth in the range of 15% to 20% in the coming year. Turning to performance films and foil, during fiscal year 26, the business reported revenues of 5,764 crores, registering a growth of 4% over the previous year. The quarter four saw a recovery in the business across all geographies, with operating performance demonstrating steady improvement. Just like other businesses, PFB faced significant supply challenges in the quarter four, arising That led to extreme volatility in raw material prices. Despite these headwinds, SRM was able to secure supplies and capitalize on select market opportunities arising from the volatile environment. COVID margins have begun showing early signs of recovery, supported by price improvements in select Southeast Asian markets, following China's recent anti-involution measures. Operations in South Africa continue to perform well and remain stable, while Hungary also exhibited initial signs of recovery during the quarter. Overall, I believe the industry cycle has largely bottomed out, though comparative pressures persist. which will be capitalized shortly. Definitely defer the second BOPP line that was earlier planned for 2027. Instead, we are investing 180 crores in a state-of-the-art... I thought I had a piece. We are working well towards approvals for high-end applications, including aseptic gardens. Sustainability continues to be a core focus and is embedded across all aspects of operations. The business is expanding its range of sustainable products, including solutions for monofamily structures, bilam structures, and PCR-based films. We remain firmly committed to advancing sustainability initiatives anchored in the 3R framework of reduce, reuse, and recycle. In financial year 26, the technical textiles business recorded a revenue of Rs. 1877. Within technical textiles, NTCF continues to remain a stable cash generator. We are seeing growth in the polyester tire cord fabric segment, and the new dipping line at Marley is expected to be commissioned shortly. Post-commissioning, we intend to ramp this business more aggressively. The belting fabric business has now begun showing traction again for the rationalization in U.S. tariffs. Advancing sustainability remains a key focus for the technical textile business. During the year, the business increased the share of renewable power in its overall energy mix, further strengthening environmentally responsible operations. In January 26, the coated and laminated fabrics business reported revenues of 366 floors. SRF continued to maintain its leadership in the domestic coated fabric segment during the year, while demand softness in food-grade liners presented near-term challenges. The impact was effectively offset by increased sales of other value-added products. The business also sustained its price leadership, reinforcing its competitive positioning in the market. Sustainability are firmly embedded in SRF's business strategy and decision-making. This integrated approach drives efficient resource optimization while enabling meaningful participation in the settler economy. A strong emphasis on transparent and robust sustainability disclosures allows the company to systematically identify and assess ESG risks, track progress, and implement a structured, long-term roadmap for continuous improvement. SRS sustainability efforts have received international validation. In FY26, the company's facilities in Guundi-Pundi and Viralamele in Tamil Nadu were awarded the Ecovarez Silver Medal by one of the world's most respected business sustainability rating agencies, reinforcing SRS commitment to responsible and sustainable operations. Further detail on SRS ESG journey, priorities and progress will be provided in the annual report. During the year for 1926, the SRA Foundation strengthened its education and skilling efforts through an integrated model spanning school transformation, digital inclusion, institutional education, and employability enhancement. Education initiatives covered 327 government schools across 38 locations in 13 states and one union territory, benefiting over a lakh in 30,000 students. 3,000 teachers, 190 headmasters, and early childhood development, reaching over 25,000 children across 314 Anganwari centers. A key milestone was the completion of the S.I.J. school at Bharuch, with the first phase commencing by June 26, and a planned capacity. Good morning, everyone. Thank you. However, this short-term pain should be seen in the context of our higher export and domestic pricing, which is generally based on import parity and will thus continue to benefit from a weaker rupee. Our planned capex for financial year 27 stands at approximately 2,500 crores, aligned with our long-term growth priorities. Reflecting on financial year 26, I am extremely proud of how the company has positioned itself across businesses and geographies. Thank you very much.

We will now begin the question and answer session. Anyone who wishes to ask a question, may press star and 1 on their touchtone telephone. If you wish to remove yourself from the question queue, you may press star and 2. Participants are requested to use handsets while asking a question. Ladies and gentlemen, please note, in order to ensure that the management will be able to address questions from all the participants in the conference, kindly limit your questions to two per participant. Should you have a follow-up question, please rejoin the queue. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Arjun Khanna from Kotak Mutual Fund. Please go ahead.

How do you see the impact to our business in terms of availability? I'm sorry to interrupt.

Mr. Khanna, can you please repeat your question?

Sure. I just said thank you so much for this opportunity, and congratulations for a great set of numbers. I think we have closed the year very strongly, as we had indicated in the conference calls earlier. The first query is regarding the availability of... Raw materials, et cetera. How do you see that impacting our business on the chemicals, technical textiles, and packaging side? Do you see and massage any disruptions from the same? I know we have talked of 15%, 20% to 20% growth in the chemical side of it, but how much have we assumed as the impact from this?

Yeah, hi, Arjun. Thanks for your question. A couple of things we've got going here together, so let me just try and take them one after another. So in terms of impact of raw material across the businesses, I think the first indicator I point you to is just the Q4 outcome. Despite all the disruption we've seen, I think we've had a fairly standout result, and I think that just speaks strongly of the team's ability to be able to ensure supply chains have remained unimpacted for the large part. I think the single biggest area of impact we could have seen was in our performance sales and foils business, and that's where I think the team scrambled really quickly and early as soon as the first indicators appeared to ensure that we had alternate supply chains in place. These have been robust and, you know, held strong for SRF for quite some time, and our ability to continue to leverage that just ensured we had absolutely no impact. We were able to run through Q4 with, you know, literally flat out, so we've had no shut days. Our expectation is even in, you know, the current quarter, we don't see... To that business, which is probably the most severely impacted potentially across raw material supplies, you know, across our portfolio of businesses. So that's the view on performance sales and foils. On chemicals as well, I think we've seen some disruption in terms of our ability to sell ref gas into the Middle East. So for about half of the quarter, we did see some impact in our ability to shift to those markets. But outside of that, there's been really nothing else from a chemical standpoint that's impacted us at a margin level. Pretty much, I think... I mean, global footprint also puts in place the ability to counter such measures, and I think the outcomes we've seen overall on the F-CAS side just kind of pointed to the fact that despite the Middle East disruption, we were able to find countermeasures in other markets. Possibly, if we were in a place where the shipments weren't impacted, we would have seen an even better quarter. Having said that in terms of outlook, I think the current view is that we believe there are some solutions showing up in terms of ability to ship back into Saudi. So that would fully ease off in the coming weeks. And that should probably take care of about more than half of what was going into the Middle East market. So, yeah, I would urge you to look at it as a portfolio set of markets that we are kind of supplying into. And, you know, therefore the Middle East impact is kind of well offset by our ability to ship to other customers.

So, Samir, can you bring out in the – yeah, just on the first question, could you talk about how much business we lost from the Middle East in the fourth quarter, FI26?

Yeah, I don't think we've lost anything yet. If you heard my comments quickly, we've lost – it's a shift from the Middle East into other markets. Okay. Reposition, I think, has ensured that we stay strong in terms of the outcome for Q4.

Sure. The second query is regarding the CAPEX we have announced on HFCs. So we have announced the 88-cror-de-bottlenecking exercise. Could you comment, because the document available online suggests what we have put to the exchange says capacity is beyond 65,000 metric tons per annum. So what is it that the rated capacity would be post this expansion, And what was the capacity before this expansion?

Okay. So I think what you've seen in the communication to the exchange points directionally to where we believe we will land in terms of capacity. We believe we will be north of 65,000. That's our current estimate. As you probably are well aware, to precisely compute... Where the bottlenecking will land us, it's fairly difficult to be overly precise, but I think we're reasonably certain we're going to be north of 65,000, and I'll leave it at that. You guys have a bunch of models already, I think, in terms of where you believe we are. I'll leave you all to compute that math out. Sure. I'd like to say that we will land at 65,000 and north of that. You know, once we're done with this exercise. I also want to call out the fact that we've been de-bottling-necking for some time. It's not something new. You've heard us talk about this in previous calls in other sides of the chemicals business. So this has been an ongoing activity. The only reason we call this out specifically is that this is a significantly larger investment than what we typically need in that space, and therefore we went to the board to seek approvals.

Sure, and in terms of the allowance of HCFC 22 or R22 during the baseline years, essentially calculations suggest we would have about 20-odd thousand tons available to us. Is that the right understanding, if you are producing R32?

So, I'm not going to directly point you towards that, but let me say a couple of things. So, one, the whole situation on ACSC is still uncertain. You know, we've seen positions from other markets. We don't have direction inside from the government of India as yet in the way they will go. I think you heard us say in the past that It would seem that the government would probably go a similar way as maybe the other markets, what we saw in the U.S. So whether that will entitle anyone to quota and capacities later on is a tough question to predict, and I don't think there's been anything directionally to suggest otherwise from the government in this interim period.

Sure. So, essentially, we are doing the capex in the hope that we would get that allowance?

Well, let me put it this way. We have seen very strong demand, you know, through the second half of this year across our clients. So we are really putting up the, you know, the debottlenecking activities around ensuring we can fulfill that demand. What it will also do simultaneously is that should the government decide to consider HCFC as well, it will ensure that we can completely avail of our quota. So it's more positioned with solving current demand that we are seeing and which we expect to stay strong. In the coming quarters, and like I said, it will also ensure that we cover any quota entitlement that we may get, should the government decide to go down that path, which, like I said, the opening is uncertain at this point, and that's been something for some time hasn't changed.

Perfect. No, thank you so much for this. I will come back in the queue, but if I don't get a chance again, thank you so much, and wishing you all the best.

Thank you. Ladies and gentlemen, kindly restrict yourself to two questions at a time. In case of follow-up questions, please rejoin the queue. The next question is from the line of Nitesh Dhod from Anand Tharati Institutional Equities. Please go ahead.

Hi, team. Good afternoon, and thank you for the opportunity, and congratulations on a good set of numbers. My first question is again on the HCFC and HFC, you know, piece. So, again, I mean, the way it came out is, you know, on the way the quotas will be allocated probably is still not, you know, still not very clear, you know. So, what I wanted to ask is whether it will be, you know, on the basis of the HCFC production, which in a way favors the incumbents, or on the basis of production capacities by, you know, by 31st December 27, which probably favors newcomers as well. So, you know, any view there, you know, whether the new entrance without HCFC or HFC history, you know, would be, would be allowed or would be, you know, completely excluded. Any thoughts around that?

Yeah, hi, Nitesh. So I'd almost first urge you to, you know, if you haven't heard the commentaries in previous calls, to kind of just speak through that. I know our president, Rashaan, did a detailed conversation with the whole community around our understanding on how the quota regime is going to work. Fundamentally, nothing has changed, right? So the baseline period and how it's going to get computed across 24, 25, 26 is still the same. The government retains the right to consider HCFC from 2009 and 10. That's the right that they continue to legally retain. I think it's safe to assume that the final view that the government will probably take will only become clear once we hit. End of the baseline period. So we should assume that early in 2027, once we kind of have known where production has landed for this year, the government will probably look at those outcomes and determine if there's even a need to consider HSC. I almost want you to point you to that direction. You know, if HSC... Production is kind of forfeit all of our domestic consumption needs. We could potentially be in a place where there is no special requirement in itself, right? But that's the right the government retains, just like all the other geographies, as per, you know, the Monterey Protocol and the Kigali Amendment, and nothing has changed on that front. And that's the consistent view you've heard, I'd say, over multiple calls. So, yeah, I think, you know, those documents are available for everyone to read. Not a lot to be interpreted over there, but I would almost urge you to refer back to that. You know, beyond that, it's tough for anyone to predict.

Sure, sir. But I think the recent notification that came in on the 1st, April 26th, That, you know, pretty much made it clear that 65% HCFC is, you know, is suddenly being considered, right? So, I think probably that, you know, thing is pretty much clear. Yeah.

Yeah, Niteesh, my answer to that is if you read that circular that came out in April, I think what the government was trying to do, and this is our view, was really two or three things. Number one, I think they were clearly calling out the fact. And making people cognizant that new capacities that were coming up, while they would be allowed in terms of environment clearance being granted, I think they were trying to call out and clarify two investors in the space to understand that it would still need to operate within the four corners of the Kigali Amendment, right? Right. So... Yes, we understand there's been lots of asks for environmental inferences, and this is the government's reaction to respond to that. It does not talk about quotas anywhere. All it talks about is the fact that you need to have capacity up by 31st December, 2027. It talks about the fact that... You need environment clearance. It talks about the fact that if you're going to look to put up capacity now, we will ask you for a clear confirmation that you will indeed have that capacity up by 2027. So I'm not sure that it points to the fact that there is a CFC being included in when they get to the quota calculations. You know, if that's the conclusion you're reaching, I'm not entirely certain how, but... Our best understanding of what came out on April 1 is totally silent on Quota and doesn't indicate anything to that effect.

Sure. My second question is on calendar year 27, which apparently is a free year. So, you know, I mean, just wanted a clarification on what exactly a free year is. Is it like a free, free to all, or is it only free to the incumbents, you know, to produce and sell? How does that work? You know, probably some understanding there would be very helpful.

Yeah, it is. So, the three are basically the free for all at the highest level, if you were to consider it. Basically, freeze gets applied Jan 1, 2028. So, if someone, for instance, has capacity but does not have quota, they would still be entitled to sell during 2027. That's all the free year means.

All right. And so, that would probably have some impact on R32 pricing. I mean, what would be your team's or your take on the same? There's a lot

of announcements of capacity, but I think I would urge you all to consume that more holistically, and with an understanding of what it takes to first set that capacity up in terms of timelines. You know, realistically, you're at 18 plus months. to then stabilize and commission, which is a couple of months beyond that. So, you know, even if any of these capacities come up, you're talking about potential impact of, you know, a couple of quarters, maybe at best, at the end of 2027, it would seem highly unlikely anything meaningful is coming on stream before that.

Sure, sir. So, this is very helpful. Thank you so much and wish you all the best.

Thank you, Nitesh.

Kindly, let's take yourself to two questions at a time. Please rejoin the queue for follow-up questions. Next question is from the line of Rohit Nagraj from 361 Capital. Please go ahead.

Thanks for the opportunity and congrats on good FI26. First question is on the HFO and associated HFO plant. When is it likely to be commissioned? And in terms of sourcing for flow as per, how are we placed? And the HFO plant, will it be completely, I mean, the 20,000 metric tons of HFO capacity will require the entire 30,000 or will be having certain contingency left for future requirements? Thank you.

Yeah, so... As part of your question, we are looking at a Feb. 2028 potential timeline for commissioning. That's where we are in terms of timelines for HFO. Let me take the third one first, since those are related. In terms of the HF capacity of 30,000, primarily that's feed for the HFO plant itself. So a significant part is going to get consumed over there. You also heard of us talking about VHF in our announcement, so the range of high-end, fast-growth market needs that we're seeing show up on that front, and so part of our IHF capacity will get utilized in our VHF facility as well. Yeah, so that's the broad direction in terms of how the 30,000 tons of HF capacity is going to get deployed. In terms of FlowSpa, you know, as things stand right now, we are in a comfortable position. Needless to say, we continue to look for new opportunities from where we can source raw material. That remains ongoing. And it's pretty much a continuing activity in the organization, but as things stand, you know, we don't see any disruption or issues on that front.

Sure. Thanks for that. Second question, you also mentioned that some of the shipments to Middle East were rerouted to other markets. Does that mean there is a change in terms of the dynamics in which Middle East is being served, or is it that the shipments and other geographies will create at least some inventory position for the time being, and which may impact our future supplies in the near term? Thank you.

I think the Middle East is probably underserved because of the current scenario that we're in. The issue is about being able to get product into the market. You know, everyone's belief at least is... A significant part of that will come back, you know, very early this quarter. I don't think we're in a situation where we are, you know, oversupplied or stocked in other markets. Like I said in my earlier commentary, even about the additional capacity, we are seeing very strong demand pull at this point in time. And, you know, so I kind of would dovetail both those comments and consume them together So that really what we're in a situation where... I think we've got enough, you know, we've got enough order, so to say, and interest from customers, which we are seeking to fulfill. So I don't think there are significant changes or stocking situations that have got created out of this. It's more about where we've been able to fulfill demand at this point in time.

Perfect. Just one clarification on the number. I'll come back to you. Thank you so much.

Next question is from the line of Arun Tassad from Aventus Park. Please go ahead.

Good morning, everyone. Thanks for the opportunity. My first question is on the CWIP that we have in balance sheet at this point of time, roughly 2,000 crores. What is the timeline at which it will get capitalized, and if you can kindly provide some color on the projects that will be capitalized in this year and next year.

I'm sorry, Arun, I didn't get the second part of your question. If you could just repeat that.

I was asking the breakup of the CWIF at this point of time in the balance sheet, and when it will be capitalized on the project basis. If you can give a cut.

Yeah, okay. So, you know, it's across a set of projects that are going on. I don't think I can just give you any, you know, one timeline that would answer, but...

Major one.

We've got investments. Can you repeat?

Can you hear me now?

Yeah, please proceed. Thank you.

Okay. So, there are a bunch of investments that are going to get capitalized, you know, through even the current financial year. There's BOPP. The capacitor plant that you heard Chairman speak about, that's expected to come through very early this financial year. There is the BOPP-BOPE line that's coming through closer to the second quarter. We have the fluoropolymer side coming through towards Q3, early Q4 timeline. Thank you. Yeah, and we will see the early investments on the Bhopa plant that our chairman spoke about comes through as well during the first half of this financial year. So, yeah, those are probably the big ones. You also heard him talk about the pharma intermediate plant.

And safe to assume that many of these will take at least a couple of quarters to reach a ramp up stage or any approvals will take, will push the revenue monetization, say, more than two, three quarters?

No, I think that's a fair assumption to work with. That's what we've typically seen. Maybe on the fluoropolymer side, well, there's work happening in parallel. Let me try and rephrase that answer. There's work happening in parallel. Even as these plants come online, you know, in some areas we are able to secure a lot of customer interest early. I'm not sure we can crunch approval times, but for the most part, I think your assumption

Speaking of the project, please resign the key for follow-up questions. Thank you. Next question is from the line of Naushad Chaudhary from Aditya Billa, Sun Life, AMC. Please go ahead.

Yeah, hi. Hope I'm audible. Thank you for the opportunity. Just one thing from our next three to five years point of view wanted to understand, a few media articles had indicated that we have roughly 10,000 crore rupees of investment plan at our research side in the next four or five years. So apart from the HFO, what other projects we have in the mind which we are evaluating and can come to this side in the next three or five years?

Yeah, I think it's premature to kind of conjecture about anything else, but let me give you a sense of scale. The RISA site is close to 300-acre site. At this point in time, we are probably developing, you know, a fifth or a sixth of it for what we're talking about on HFO. That site is largely going to be for chemicals. I think we've kind of been explicit about that. Now, how that pans out beyond what we've initially thought about on HFO is still to be seen. So it would be very premature, I think, at this time to kind of talk about what else would come over there. But I think we're safe to assume it would be largely in the chemical space. That's how we're thinking about that location.

And lastly, on the spectrum side, would we be able to quantify in terms of how many molecules we have in the hand if it goes well, could be as equal to as your current largest molecule?

I think that's ongoing. I'm assuming your question is directed more at the agro side. There are, at this point, seven or eight products that we are in a very advanced state on with customers. But also kind of add to that, that despite everything happening in the space, we continue to get interest from customers on newer areas. So there are newer products where we are continuing to see interest from our customers. So, you know, while the innovators may be, you know, proceeding slowly on the registration side, they intend to... Continue to look at new opportunities with us continues at this point. Yeah, so I think that's kind of where we are in that space at this point in time. Yeah, I'd also add that I think given the amount of work that's happened over there in that whole space, as we kind of eventually get to a place where we are out of the cycle, you know, we should see a lot of interest and ramp up. Very soon thereafter, given the work that's gone in over the last year.

Thank you so much. All the best.

Thank you. Next question is from the line of K. Yur Pandya from ICICI Prudential Life Insurance. Please go ahead.

Thank you for the opportunity. Just to expand the comment of the chairman on the 15% to 20% growth for the entire chemical segment. If you can give more clarification on what would be the growth drivers for FY27, since we are almost fully utilized in terms of RevCase, and we are talking about pricing challenges and volatility in spec chem segments, so what would be the building blocks for 27, 15, 20% growth? That is the first question.

Yeah, over there. So number one is just overall ref gas. I think we've seen, you know, if you look at the numbers sequentially, you'll see a significant uptick between Q3 and Q4 itself. We believe that will continue to hold. Like I said earlier, while you heard about debottlenecking at scale right now, it's not that this was not continuing in the past as well. We can go fulfill, and so there's both the volume and price play over here. The second really is on the specialty side, we've consistently said that we will hold share. I think it's... Price destruction, so to say, in the market is behind us, and we should slowly start seeing the recovery from here. Pick up in the second half of the year as well. So that will start increasingly looking better. And I think you heard Chairman also talk about the fact that the chemo's arrangement is working out well. That's all set and progressing on track. So again, Here, we should start seeing early outcomes over there in terms of impact on numbers. So broadly, those are the building blocks that kind of drive this view in terms of where the growth should be for the chemicals business in the coming year.

Understood. And second, on the HFO part, so I think in the initial comment, the initial comment was about enhancing the capacity because of the client interest. So this would be a merchant sales the way we have done for HFC. There would be a tie-up and we'd be making it for someone else. If you can just gratify on that. Thank you and all the best.

Thank you. Well, as things stand, you know, we're not in any tire. You know, even when we went into the HSC space, it was with a clear view on where we saw the res gas opportunities lie, and that's, you know, where we are following the same track over here. Going to come, you know, and I think there's a strong advantage to be an early mover. In our channel's speech. It's non-infringing, and we believe it's potentially going to come to the call. And that, I think, positions us really well for an opportunity. We're already a global player with a significant share. So, you know, in the more mature markets that we're in, where some of the shift is already beginning, we are hearing a lot in terms of interest over there. And that's kind of driving our actions today that you see in terms of this capacity.

Thank you. Next question is from the line of question, Parvani from SPI Mutual Fund. Please go ahead.

Yeah, hi, sir. Thank you for the opportunity. Two questions from my side. First, on the floral specialty, what were the floral specialty sales for FY26, and where do you expect to end FY27 for floral specialty?

Yeah, you know, we don't get into the sub-segment data. What I can share is we've made strong progress over there. You've heard us consistently talk about moving up the value chain, you know, from bulk to fine cut and free flow. That continues. We are in a pretty advanced state in terms of a speciality for Ocolymer as well. And, um... You know, that progress stays on track. I think you're going to have to think about this business almost like how many of you consumed the chemicals business many, many years ago. There is a lead time to get to a place where we will be effective, but I think the combination of all that we're doing ourselves. Along with the whole key malls arrangement that we have, positions us really well. I think we'll start seeing some strong outcomes in FY27 on the revenue side. Like I did say earlier in my commentary to earlier question, we should start seeing that in the second half of this year. And I think post us going into the next financial year, we will see a fairly material ramp up in terms of outcomes.

Okay. Thanks, Kahi. I love the answer. I asked you because you mentioned the PSNB photo specialty cells every year in the annual report, but no worries. You don't want to disclose it right now. Second question is on HFO. So, which HFO will come first? Because I think the chairman mentioned that you're looking at multiple HFOs. So, are you looking at 1, 2, 3, 4, Y, F, 2? Sell it first, and if yes, do you expect some of your 134ACs to be cannibalized by 12345?

I think you heard the chairman clearly call us, we're going to get into all three products. The current plan is that these are all going to come up largely in parallel. Commissionings of each of these could be at slightly different times, just given the product intricacies. But given we are barely just announced, I think it would be a little premature at this point in time to call out which ones will come up first. I think it was suffice to say that all three... Our capacities are being put up in parallel, along with everything on the HF side and the HF, so it's not that we are going sequentially on this, but which ones precisely will come up first at this point I think is a little premature. We will have a, you know, we probably have a better sense and be able to share in some time from here on.

Sure, and could you answer the second part? Do you expect HFO124YF sales to cannibalize part of R134FAs?

I see that happening just for the simple reason, you know, where the markets that we're addressing and where HFO demand is probably going to come through first. They're probably going to be fairly distinct. So, you know, at the outset, I would think that would be my summary answer at this point. But, yeah, again, we're talking situations two years plus out. We need to see how things are at that point in time. But directionally, that's the view right now.

Okay. Thank you. Thank you for patiently asking my question. Thank you.

Thank you. Next question is from the line of Ankur from Access Bank. Please go ahead.

Yeah, hi, sir. Thanks for the opportunity. First question on the specialty chemical side, if you could help us, you know, better understand how are you looking at the growth here across the existing as well as, you know, the newer products that we have been working on, especially given, you know, the pricing pressure from China being there.

Yeah, I think the way we're looking at this is... It's going to be super critical to have a really strong product pipeline, and this has got to scale across from the intermediate space all the way to AI. We've all seen the cycle pan out. You heard our chairman speak about it as well. At some point, different products will go down the value chain, and therefore, having a strong product pipeline is going to be super important. I think just given the amount of work that's gone in, in terms of, you know, our in-house development and customer interest, we are well positioned over there across this whole value chain from intermediates through to AI. We've also done a fabulous quantum of work in the last year around Managing through efficiencies, and I think even in these tough times to see the outcome that the chemicals business has reached from a margin standpoint clearly points to all of the effort that's gone in in terms of technological interventions as well to make sure that even as products come off those really high pricing levels, we're in a place where we can continue to compete in the market. And ensure we sustain volumes at effective margins. So I think what's key is going to be to stay relevant across that whole pipe of products. And there's a significant amount of work that continues to go on over there. That's going to be key, I think, for ongoing success in the speciality space.

Sure, sir. Second question on, you know, the product approvals bit, this is more for the newer businesses on the medium foil side or the PTFE, the specialty grade. Where are we in terms of, you know, because we wanted to get into the premium grades and the, you know, higher realization ones. So where are we in terms of product approvals here and what timeline can we look at for a revenue ramper for the existing capacities?

On the flora columnist side, everything that we're doing in terms of moving up from bulk to fine cut and free flow, that's very advanced right now. I think we've kind of pointed earlier to a question saying we should expect to see ramp up over there in the latter part of this year. I'm not sure if the rest of your question points to everything in terms of the chemo's arrangement. Again, we said that's on track. So post-December, which is when we're kind of meant to be set and ready, Q4 is when that should kick in, and you've heard. Our chairman talked about the fact that that's a reasonably high margin contract, so we should see good outcomes over there.

Yes, we haven't talked about this before.

Yeah, so exports and aluminum have already started. I think that was the second part of the question. You know, we've already seen progress over there through Q4 of this year, and that's helped ramp up outcomes over there. We continue to have that focus, and we should see that kind of trajectory only improve through 2027.

Sure, sir. Thank you and all the best. Thank you.

Thank you. Ladies and gentlemen, we will take that as the last question for today. I would like to hand the conference over to the management for closing comments.

Thank you all for joining this call. We hope we've addressed many of your questions. If you should have any further queries, we're more than happy to assist. I look forward to your continuing support as we move ahead, and on behalf of the whole management, thank you once again for taking out the time to join us today.

Thank you very much. On behalf of ICICI Securities Limited, that concludes this conference. Thank you all for joining us today, and you may now disconnect your lines.