Syrma SGS Technology Limited (SYRMA) Q1 2027 Earnings Call Transcript

Ladies and gentlemen, good day and welcome to the Sirma SGS Technology Q1 FY27 Investors' Con Call hosted by Access 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 this conference call, please signal an operator by pressing star, then zero on your touch-tone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Nikhil Kandoy from Access Capital. Thank you and over to you, sir. Nikhil, sir, please go ahead.

Thank you, everyone, for joining the call. We are hosting Sirma SGS Q1 F527 call. We will now, I will hand over the floor to Nikhil Kupka for their opening email. Thank you for the opportunity, Sirma.

Thank you, Nikhil. A very good morning to all of you. On behalf of Sirma SGS family, we welcome you all to the Sirma SGS quarter one and fiscal year 2027 earnings call. We have with us today Mr. J.S. Gujaral, Managing Director, Mr. Jayesh Doshi, Whole Time Director, Mr. Jayadi Singh Baraj, Chief Executive Officer, and Mr. Vijay Agrawal, Chief Financial Officer, Sirma SGS, to discuss the performance of the company during the first quarter and fiscal year 2017, followed by detailed portion and answer sessions. Kindly note, during the call, certain statements that will be made are forward-looking, which involve several risks, uncertainties, assumptions, and other factors that can cause results to differ materially from those in such forward-looking statements. All forward-looking statements made herein are based on the information presently available to the management and to the company, and the company does not undertake to update any Good morning, ladies and gentlemen.

A very warm welcome to the Q27 earning call of CIRMA SDS Technology Ltd. Always a pleasure to interact with all of you. Before I start the summary of what has happened and what's going to happen, I would request our new CEO, Jadid Braz, to just say hello to all the analysts and the participants and introduce themselves before I take up on the detailed presentation. Jadid?

Thank you, Mr. Gujjal. Good morning, all analysts, and I'm delighted to be here. I joined Sirma STS on 29th of June. I have spent 24 years at McKinsey, and then I've spent two years after that in various roles in the automotive and the energy industry. I'm very excited about the opportunities and the potential of Sirma STS, and I'm looking forward to my journey here.

Now, I think we have had a lovely quarter which lays the foundation for us to grow as a plan for the current year. Despite the turbulence of the geopolitical sort of problems that you're having in the Middle East, which translated into supply chain constraints, we're able to register a very robust growth on all parameters, whether it was the top line, The EBITDA, PBT, PAT, which grew by more than 100%. Those figures are available with everyone. I will not delve on that in detail. I will highlight two qualitative factors in this quarter. The first one is the continued buoyancy in the exports. Sports last year grew by 40%. This first quarter, they have grown by 61%. Now, this position as well to further integrate to the global supply chain market. And as I have all the time been saying, for a long-term, sustained, profitable growth, integration of the Indian EMS companies with the global clients is a must. And I think the efforts which our teams have put in the past two years have shown results last year and are showing even superior results this year. So going forward, I believe exports would continue to be one of the mainstays for our growth and profitability. The second factor is that my ODM sales, which is our own design manufacture sales, have gone up by almost 100%. Last year, they had gone up by about 82% to 825 crores. And this year, in first quarter, they have gone up, they have been 270 crores versus 135 crores last year. So these two sort of pillars for the growth, when they are registering a very high sort of growth trajectory, augurs well for us to deliver superior performances in the coming quarters. There has been a secular growth in almost all the verticals. I personally don't foresee demand-side to be a constraint in the coming quarters. I think demand from across verticals is robust, or medical vertical, medtech vertical is doing very well, and I started picking up. Defense vertical early, but going forward in the coming quarters, it will scale up. What is worrying, not from a micro-level, SIRMA, SDS perspective, but from an industry level, is the supply chain constant. While demand remains bullish, supply chain is a cause of concern because of the geopolitical situation, supply of some specialty chemicals which go into the PCB making, a lead time of components going up. So, what we are focused on in Enserma SES is to ensure that our customers don't suffer because of these supply chain constraints. We have formed a war room in the company to look at this, and every customer, every component is being sort of minutely monitored at the senior-most level. We have also taken a cautious call that we will not treat inventory as a working capital, at least for the next quarter or two. Inventory will be treated as a strategic asset, strategic investment. So I personally believe across the industry, we will see a tad increase in the inventory levels in terms of number of days till the situation normalizes. I expect maybe six months down the line when we talk to the manufacturers and distributors, they say by the end of calendar 26, the situation should be back to normal. So in the next six, eight months, five months, we should all be aware that the inventory levels across the industry would be going up. Our projects which we have undertaken, the PCB project, is on track, almost 65-70% complete. Equipments will be received from October onward, and we are on schedule to power all the equipment in the quarter of January, March, take out samples, and the process of approval from the client starts. Overall, I think we are well on track of not only achieving what we are guided, but exceeding that achievement. With this, I hand over to Vijay Agarwal to delve on the final number of detailed financial numbers.

Continuing the momentum built over the last several quarters, starting with the revenue numbers, our controlled total revenue for the quarter stood at 1,604 crores, registering a 67% year-on-year growth. And more importantly, this growth has been accompanied by continued improvement in profitability across, including our EBITDA numbers and the PATH numbers. Our operating EBITDA increased by 69% year-on-year to 162 crores, while total EBITDA, including other income, grew up by 72% to 177 crores for the quarter. PVT increased approximately 110%, reaching to 141 crores for the quarter, and PACT for the quarter is 106 crores with 112% of growth for the quarter. Over the last few years, we have consciously focused on improving our product mix, expanding into higher-valued programs, strengthening our operational efficiencies, investing into technology-led manufacturing capabilities, and some bit of automation. The benefits of these initiatives are now reflecting into our overall profitability. Coming to our overall business performance, groups during the quarter were broad-based. The consumer business remained our largest vertical with 34% of our business mix and delivered healthy growth supported by faster customer ramp-ups and some with upfront loaded seduced from key customers. Similarly, automotive business continued its strong momentum and now contributes about one-fourth of our overall total revenue with 34% of our business mix. We continue to benefit from our increasing validation of EV across all vehicle platforms and deeper engagement with our new customers. Healthcare maintained healthy performance while IT and railway business continues to scale well from a relatively lower base. The industrial segment specifically witnessed some moderation on a sequential basis, primarily due to rear-endage schedules of our maritime business, wherein the majority of the volume is loaded in second half of the year, And also, some bit of lower pick-up on the smart-metering business. However, we remain confident about the medium-term opportunity on this business, seeing the overall order book visibility also. Coming to the export number, as Mr. Ghidral has also highlighted, this has performed very well and contributed approximately 24% of our operating revenue, reflecting our growing participation into global supply chain. The overall export number for the quarter is around 387 crores. Similarly, the Orion number for the quarter is approximately 17% with 270 crores of Orion business for the quarter. Concentration for the quarter, my top 5 customers contributed around 38%, while top 10 customers contributed around 51%, and top 20 around 66% of our total revenue for the quarter. Coming to our order book visibility, as of June 8, we have approximately 6770 crores, 6770 crores of overall total order book visibility, of which if we give the break up by each vertical, automotive is around 29%, consumer is around 30%, industrial segment is approximately 24%, healthcare is around 7%, which includes medtech business also, And IT and LV is together about 9% of my total overall. Some bit of update on the new customer additions. During the quarter, we onboarded 18 new clients, of which 5 on the auto side, 3 on the industrial segment side, 2 on the healthcare side, and balance on the telecom and IT and LV side here. But again, this shows a very strong business addition in pipeline for the future years. We remain confident that as volume grows and continue to scale, and your programs mature, our overall operational efficiencies will continue to improve overall over the medium term. Coming to our balance sheet performance, during the quarter, our net working capital gains increased from 63 to 71 days, and mainly due to higher inventory days. As Mr. Budhral was also explaining, we are keeping higher inventory levels as a strategic asset, and this, something like we will be continuing for a quarter or so, And this is primarily a conscious decision to support our speedy ramp-up of the new customer programs to ensure uninterrupted availability of critical electronic components. This decision will help us, at least in the short term, ensuring no disruptions related to our customer supplies and delivery. This strategic decision resulted into higher working capital requirements for the quarter and an increase in the overall short-term warrants by about 340 crores during the quarter. However, it is important to note that we continue to maintain a net cash position of 122 crores, supported by healthy treasury balance cash and investment balance of 800 crores plus as on June 9th. We believe this inventory will give us a larger strategic assurance, supply assurance from the customers, strengthening our overall long-term relationship on both sides. On the financial ratio side, return ratios continue to improve. Our adjusted annualized ROC for the quarter is 20.1%, reflecting improving capital productivity. Going forward, our capital allocation philosophy remains unchanged. We will continue to invest prudently in capacity expansions, technology, design capabilities, strategic growth initiatives, while maintaining financial discipline. Beyond this quarterly financial performance, our strategic priorities remain intact. During the quarter, we had tied up with a Japanese MNC player, Kaza, to manufacture all their AMS requirements through a jointly held subsidiary in India, wherein Sirma holds 60% and balance will be held by Kaza India. Initial investment into the JV would be approximately 24-25 crores by both the partners together. Coming to our PCV project update, the project is completely on track. We had invested around 50 crores during the quarter for this particular specific project, while overall capex investment during the quarter is about 90 crore rupees. We expect this VCB project to start at least commercial production by April of 2027. Our priority continues to be consistent and profitable growth, supported by operational excellence, disciplined capital allocation, and long-term customer relationship. With that, I will now request the operator to open the field of questions, and we can take up the questions.

Thank you. We will now begin with 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, we will wait Wait for a moment while the question queue assembles. The first question comes from the line of Anirudh Joshi with ICICI Securities. Please go ahead.

Yeah, thanks. Thanks for the opportunity. So, congrats to the entire team for a solid set of numbers. So, two questions. Is there any one-time revenue booking done in Q1? The numbers look extraordinarily strong. So, any pre-pornment of revenue booking or order booking or like that, that is question number one. If not, how should we look at the next three quarters in terms of the revenues, especially the consumer segment revenues? And second question is, there is a board resolution for raising funds via QIP of almost 1,000 crores. So, any particular developments that can be shared here or it will be just a normal resolution passed and depending on the opportunity, the fundraising decision will be done. So, any color on that as well. Okay.

I'll answer the first question in an affirmative that there has been no one-time transaction which has been booked into the quarter. These are the normal run-of-the-mill numbers. The performance has been better because over a high margin profit business, exports and ODM have gone up, while consumer also has gone up by about from 30 odd percent to 34 percent. But the effect has been sort of greatly absorbed by the increase in my exposed podium numbers. So these are normal accounting, sort of, these are numbers which are based on the standard accounting policies and no one-time expense has been charged or one-time income has been bought. So I should be making that very clear on that. Vijay, would you like to add something on that?

Yes, so there is no abnormal one-time kind of a revenue there. Now, coming to your question on QIP, very clearly, every year, we take this QIP resolution for the area. This is something as an enabling resolution we take us so that in future, if we get a good investment, we should be ready with the funding kind of pipeline available with us, and that's how this is the QIP resolution we are taking, why there is no immediate need for going down.

Just to add on to the two points which Vijay has said, on the QIP, I think it's an enabling resolution. The sector is seeing such positive tailwinds that you have to be so-called, you have to have a war chest ready for any emerging opportunity which may come. And the opportunities are immense, whether it's in the semi-con business, whether it's in the normal thing. So it's just an enabling resolution. On the second part of your first question, going forward, we believe that we are on track to not only achieve what we have guided, but we exceed that. By how much percentage, I think let's one quarter more go by, and we can all have more clarity. And this is because of the supply side constraints, not from the demand side of the issues. End of the year, I think we would broadly be within the parameters of the industry-wise verticals which we have been guiding. We have all the time been maintaining that we don't view numbers from a quarterly lens. In fact, when we are building an institution, the numbers have to be viewed from a multi-year trajectory thing and not even annual. For institutional building, I think we have to see where we started from, where we have reached, and where we want to. History being achieved, set out, and whatever we have been sharing with the screen, we have shared where. Thank you.

Sir, just one clarification. Now, memory prices are, so we are doing prudent inventory, but generally the memory prices will be a pass-through. So, it will not have any impact on even the percentage margin. I mean, absolute margin per unit, it may not have any impact, but it will not have impact on absolute percentages also. It will be a complete pass-through. Is that correct?

Yeah. Even if it's a complete pass-through, as an example, if my chip is 60 rupees and I'm selling it at 100 rupees, I'm just taking one example. So, it's a 60% drop material margin. 60% drop material margin. The chip goes from 60 to 100. I sell it at 140 to the customer. 140 is not 40%. So, while the absolute figures will remain intact, broadly, the percentage margin would undergo a change because you don't get a mark-up, you don't get a value-add on the increased cost of a chip or a memory.

Oh, okay, okay. So the percentage margin may see a slight correction.

Yeah, again, I don't get a value add on the price increase. I would love to have it, but I don't get it. No one gives a value add just because your price has gone up. Your other costs have not gone up.

Okay, sure, sir, sure, sir. This is well understood.

No impact on the absolute numbers.

No impact on the absolute numbers. Okay, sure, sure, sir. Understood, understood, sir. Many, many thanks.

Participants in the interest of time and fairness to others, please restrict yourselves to one question. For any more questions, you may rejoin the queue. The next question comes from the line of Mayank Pandey with MK Global Financial Services. Please go ahead.

Hi, sir. Thank you for the opportunity and congratulations on a good set of numbers. Sir, I have two questions. Question number one is on the consumer business. Could you just help us understand how, because in the past quarters, you've guided that this business will try to keep at, let's say, 30% of total revenues. Could you just help us understand how we should look at it going forward in terms of what businesses or what product lines sort of we are targeting and how the growth can come or how we will limit the growth in that sense, in that segment? That is question one. And my second question is on the PCBN project, the manufacturing project for PCB. Do we expect to have to raise funds for any part of our PCBM project, phase one, phase two, both combine, whether now or in the future, or do we expect it to be fully funded through India? Those are my two questions. Thank you.

Okay. On the composition of the sales, I think we are very confident that we'll be maintaining the trajectory of our consumer being at about 30% of my total sales. As we are all the time being reiterating, quarter and quarter, there would be aberrations. There's never a secular growth in every vertical. Each industry has its own profile, but on an analyzed basis, we still think that our consumer business would be around 70-odd percent of the ECB project, I personally don't see any constraint in terms of requiring additional funds. So, first phase of the project is on track. We should be powering on the equipment in January to March, and once we start the production, we'll be filing the claim with the government for the subsidy, and the second phase and the third phase of the equipment of the project will only start towards the end of 27, early 28. So, I think the project is well funded, and I'll request Vijay to throw more detail light on this.

So, just to add on here, the first initial phase, like we are incurring around 400 crore rupees, about 100 and 130 crore is already funded so far, and the balance will be funding during this particular year. And again, a 50% bet is what we will be taking for this thing, 50 to 60%. But most importantly, when we grow further, like next year, when we try to fund another 400 crore rupees, a majority of that can also come through the government incentives also. So, there is a government capex incentive which is also available as a funding source here. 50% capex incentive is available for this project. So, we will be funding through internal accruals, capex subsidies from the government, and from the debt. We already have an 800 crore plus kind of a treasury balance, which will be sufficient for all these phases of this particular project. Plus, yes, obviously, if it goes over, the internal accruals will keep on adding for this thing.

Thank you. The next question comes from the line of Bhavik Mehta with J.P. Morgan.

Hi, thank you. Just one question on this multi-layer PCB. What kind of asset turns we can expect in the first year of operations when it starts in April next year, and what kind of EBITDA margins we can expect in the first year, X of ECMS benefits, and also if there's some colour in terms of how much ECMS benefits we can get on the margins?

Normally, asset term varies around 1.5x, but initially, in the very first year, as you are checking, the capacity utilization can be lower around 40 to 50%. So, it can be lower in the year one, and thereafter, it can gradually move towards maybe 80% plus kind of the capacity utilization, which will be around 1.5x per asset term. Normally, with the full, complete ramp-up volume, one can expect extra any PLI incentive, the EBITDA is in the range of 15 to 18 percent. But initially, when the capacity utilizations are lower, EBITDA can also be lower, around 10 or maybe less than 10 percent also.

And just to add what Vijay said of 1 to 1.5x set turnover, that is on the gross basis. That's not accounting for the subsidies.

Thank you. The next question comes from the line of K. Uru Pandya with ICICI Prudential Life Insurance. Please go ahead.

Thank you. Sir, just one question on the revenue side. So, for last two or three, since quarter three, our order book is around 60. So, it was 6,400 crores. Today, it is around 6,700 crores. So, this similar sequential order book, should we assume current revenue run rate to continue We should expect acceleration from here as well. First question on that. And second, on the profitability side, so this quarter, your share of consumer is lower versus last year. Consumer segment share is much higher versus last quarter. And despite that, our margin is around 10% plus. So, should we assume that this is the bottom range of the margin, we should assume even with this kind of mix, where consumer is more than 30-34 percent?

On the margin front, I think what we have guided 10.5 to 11, we maintain that we will be delivering that margin profile for the full year. So, I have no sort of concerns on that. On the order intake, what you have suggested, you are saying, I think it's a logical thing, and we have seen an uptake in the order book from quarter on quarter. For example, I think in Q1 of last year, our order book was around 5,400, and today it is 6,700 plus 6,770. So it obviously means that quarterly intake of orders is increasing. I think my quarter order book on the end of March was 6,400. I have executed 1,600. And I have got an order book of 6,770. So it means order intake in one year, one quarter of about 1,800 crores, 1,781 crores. So, I think as we scale up, obviously, if we have to do higher revenues in the coming years and quarters, quarters and years, the quarterly intake of orders should also show a rise.

Just to add in here, considering the order book and the visibility here, that's how we are guiding the 35% plus kind of a revenue growth for the full year is what we are guiding. Yes, quarter and quarter, there is a higher intake is what we are seeing here right now. And coming to the EBITDA percentage, when we compare the business mix versus last quarter, last quarter, consumer segment was lower, and that is where we have seen 11%, 11.3% kind of operating EBITDA margin for the last quarter. But this quarter, it is 10.1%. That's primarily because there is a higher consumer mix into this business. But again, having said that this consumer is not evenly distributed across four quarters, so we may see some kind of a seasonality here, so that overall full year number can be in the range of 30% to 32%. But this quarter, it was 34, some other quarter, it can be lower also.

Understood. Just one clarification on this. So, earlier you mentioned that this guidance of 35% growth on the revenue side and around at least 30-35% growth on the EBITDA side. You mentioned that you would upgrade it later, but you think you will need to upgrade the guidance. That is what you mentioned earlier?

So, what we said was that, one, we are very confident of achieving the guidance, not only achieving the guidance, the numbers both on revenues and data, but based on the strong performance of the first quarter, we should exceed that guidance. We should exceed that guidance based on the first quarter performance.

Understood. Sir, thanks a lot. I know the best.

Thank you. The next question comes from the line of Sumant Kumar with Motilal Oswal Financial Services. Please go ahead. Yeah, hi, sir.

So can you talk about this healthcare segment? Last two quarters, we have seen a momentum of 130 crore, 135 crore. And from here, what kind of order book we are receiving and how the growth is going to improve in this segment?

So, maybe I can just add in here. Yes, the current order book is giving almost 500 crores of orders from this healthcare segment, which includes healthcare RFID solutions also in the medtech business. But most importantly, we have onboarded, in this quarter also, we have onboarded two new clients on the healthcare side, again for the CDMO manufacturing business and the design business also for one of the clients here. So, this business is picking up goods. If I talk about specifically the MedTech business, we did about 210 crore last year throughout Patshidri Sirma Johari MedTech. And this year, we are expecting the business should be growing almost 50% because the base is lower here. So, this business is showing good potential now to grow. And that is how we have been guiding that this will be approximately 7-8% of our total overall business for this year.

And for the PLI 2.0 and ISM 2.0, what kind of business segment we are exploring, and what are our thought processes for this?

Okay. For the PLI part, there are two. One is the mobile PLI part, which, well, we are currently not seriously evaluating that. We're not there. On the ISM 2, which has just been announced, and I think the notifications, the detailed guidelines are yet to be out, So we still maintain our earlier stand that we are interested in this. We are interested not only in the packing, but also the back end and the key parts, the components which go into the making of a semi-con. But for us, one of the key qualifying criteria is to have a credible partner. And that's a stand we have been maintaining right from ISM-1. We didn't participate in ISM-1 because no credible partner had come to India. And if you see only Micron and Renaissance, the two big names are present in India, rest are yet to take a call. And we are very much in discussions with the potential interest of the management is concerned. Yes, we are definitely very much interested in the business opportunities emerging out of time.

The next question comes from the line of Bhavya Gandhi with Baja's Alternate Investment Management. Please go ahead.

Yeah, thanks for the opportunity. I just wanted to understand what is the average order execution period for the existing order book, and how could this Kaga opportunity be over the next couple of years?

So on the order book, I can answer, and then Gujarati can add on for the Kaga JV. Out of the 5770, approximately 5400 crore is what we need to execute in the next 12 months, and the balance is like beyond 12 months, like in the quarter subsequent to that thing. That's how the current order book is there. If we calculate the overall average period, it comes around 10, 10 and a half months there on the order book side. Coming to your question on Kaga JV, this is a JV primarily to meet of their UMS requirement here in India on exclusive basis. That's how they are primarily very strong in India on the automotive side and also some bit of a crazy business which is on the whiteboard side also. That's the two kind of business verticals we are initially targeting through this JV. Gradually, they are very strong on the Japanese market side. They are a big global complement to having multiple businesses in Japan. So going forward, in future, we may also target supplying or exporting to the Japanese need also.

Just to add on to what Vijay said, I think this is a strategic tie-up with long-term positive ecosystem. Everyone knows it's a very conservative ecosystem. It's not flamboyant. Partners in Kaga gives us that entry-level point into the Japanese market. Short-term will be catering to the domestic requirements of Kaga, and we should not forget that Kaga has a very strong distribution network of components. Going forward, I think we'll have a positive rub-off effect in my purchasing because of the Kaga leverage. So it has two, three dimensions. This joint venture has two, three dimensions. Domestic supply to Japanese customers, a foot into the door of the Japanese ecosystem, and the distribution of components taking benefit of that in our material procurements.

Got it. Is it possible to quantify in terms of opportunity? How big would it be over the next 3, 4, 5 years?

So, we are just starting setting up this TV right now. So, in this current year, this may not be much, but over the 3, 4, 5 years, we can see somewhere around 300 to 500 kind of business on long-term basis.

Got it. Got it. Thank you so much. That's it from my end. Thank you so much.

Thank you. The next question comes from the line of Vishal Goel with HSBC Securities and Capital Markets. Please go ahead.

Hi, thanks for the opportunity, and congratulations for a good number of years.

I'm sorry to interrupt, Vishal. You're not quite audible. Please be a little louder.

Hello. Am I on the right? Yeah, yeah. Yeah, okay. So my first question is, at the last quarter, you mentioned that you have very solid intent of entering the renewables energy space market, especially in the inverter business. So, any update on that front? And the second question is just a clarity on the ODM revenue number which was shared earlier. So, I heard you said it was 270 crore or 17% of the revenue. If that is the case, then that is the decline. So, I just want a clarity on that.

No, no, it's not a decline on the ODM number. My Q1 F526 ODM number was about 125. It has gone up to 269. Sequentially, yes, it could be a decline. I am not saying from Q4 of last year to this year, the decline may or may not be there. That video will share the numbers.

Q4 of last year, it was 345. Sequentially, it is a decline, but here on the basis, there is a more than 100%.

All the maritime, defense, communication business, and medtech business are rear-end loaded. So we are very confident of scaling up this business and have a positive growth in the current year. So there's no doubt on that. On a sequential basis, there's a decline, but on Q1, quarter-on-quarter, year-on-year, last year, we have almost like 100% uptake from 125 to 270. 150. 150 to 120. Now, as far as the renewable energy businesses can post our sort of decoupling of the caseholder deal, we are in touch and in negotiation with potential partners, and these things take time, but it is still in the sort of focus of the management to enter this space. Once we have a firm tie-up and all those things, we will definitely come back to the street with the details. But the business is a focus area for growth.

Thank you. And thank you for clarifying the ODM number as well. Thank you, team.

The next question comes from the line of Achal Lohade with Nuwama Institutional Equities. Please go ahead.

Yeah. Good morning, team. Thank you for the opportunity. Congratulations for great execution. Sir, if you could talk a little bit about the capacity utilization. Currently, what kind of CAPEX are we looking at, you know, in the current year as well as next year? X of PCB?

So, X of PCB CAPEX is what we are seeing around 100 to 150 crore rupees for the full year, of which near about 40 crore is what we have incurred in the current quarter. So, on the CAPEX side, capacity utilizations, current capacity utilizations are in the range of 65 to 70 percent as of now, And we are still building up certain more capacities at our Bangalore location. Also, we are expanding to one more facility at the parallel to our current existing plant. And similarly, in our Pune also, we are expanding the capacities also. This is a continuous process depending on the business additions. We will be keep on doing those business capacity enhancements or maybe staffing of the current facilities with incremental lines. Just to add on a question here, we are setting up one additional capacity for our medtech business, specifically in Jodhpur. So, there also, we are expanding the capacity with the additional plastic injection molding capacity and the S&T lines over there, keeping in mind the additional incremental new medtech businesses, which we are getting now.

Yeah, so, in the medtech business in Jodhpur, we are expanding more capacity and capability. We are entering into medical-grade plastics and new sort of lines into the medtech business. Hence, the expenditure is being incurred. So, I think this will give us a good growth opportunity in the coming years, 27, 28 onwards.

Just a clarification on your earlier comment in terms of the percentage margin. Can you help us understand in terms of the price inflation of your components, how large would that be on a blended basis to just a ballpark and what kind of bids impact we have already seen in 1Q because of that?

See, what is the impact? I think on an online basis, I can't comment because the situation, the dynamics of the global economy, supply chains keep changing. I was only resting to a principle that if I get a 100% pass-through of my cost increase, my absolute margin is not affected, but my percentage margin gets affected. That was the only thing which I was referring to.

Yes, yes, I understand, and that's why this question, sir, the reason I'm not...

But I start to say that what it would be for the full year as my economy, the supply chains are still evolving. Where does the dollar go? I don't know. What will be the semiconductor shortage? I don't know. But I know there will be a shortage. So what will impact it will have on the supply chain because all the demand of semiconductors is being consumed by the AI center, Now, of late, there has been a sort of slowdown, sort of a general perception that the AI may not be that good of that. So, if that happens, the supply chain constraints ease. So, I really cannot comment today, but generally we believe that the pressure of supply chain will continue, and whenever there is a pressure, it has a direct implication on the cost.

But just to add on there, whatever guidance we are giving, 10.5 to 11% of our margin, I'll take it off time.

Thank you so much, sir.

The next question comes from the line of Neel Mehta with Equirious Securities. Please go ahead.

Yeah, hi, sir. Sir, congratulations on the select set of numbers. Sir, just wanted to know that, you know, sir, you mentioned that we have on-boarded 18 new customers. So, like, from where we can expect this to flow in our financials, you know, sooner. And the second question is that, sir, we have a seen sharp, you know, YY growth in auto. So, just wanted to know that it is a lastly a wallet share T1 growth or a new customer T1 growth. You know, if you can highlight that.

So, all the new customers, I think whatever we are onboarding the new customers in this quarter, in this year, it will not have a significant impact on our revenue. These are all work in progress. This will give us a growth in the coming years. The breakup of the customer onboarding, Vijay, will share in what vertical, but typically they are in line with the market, sort of, breakup of the vertical sales.

So, just to add in here, on the auto side, we have onboarded five new clients. Industry also three clients. Healthcare also two clients, and the balance on the telecom, IT, and delivery. But, as Mr. Vijayala said, actually the volume may start off from the next year. And full ramp-up may take a year after that also, actually. But these new customer additions may have a potential to give me additionally 1000 crore plus kind of a revenue on a full ramp-up basis.

And sir, what would be the margin profile of these new customers versus the current margin profile?

So there is a segmental margin will follow. So if somebody is there in the auto segment, auto segment related margin will come into that. They will not be completely off the vertical kind of a margin. So, depending upon this business which trying to come into this vertical, the margins of that vertical would generally fall.

Sure, sir. And, sir, just last question from my side. If you could, sir, what would be the geography mix of the current quarter's export revenue?

Okay, the export revenue, what we have got is, if I was to take it as the only percentage of the exports, only percentage of my exports are, say, 387 crores this quarter. If I was to take the breakup, USA would account for about 22, Europe around 40, and the balance is other countries. But if I was to include NAMP, then the figure of 22 percent, NAMP means Mexico, Canada, and America, Then this 22% would go up by another 15 odd percent, I guess. This is break-up of the export sales, not as a percentage of total sales.

Got it, sir. Thank you so much, sir.

The next question comes from the line of Praveen Sahai with PL Capital. Please go ahead.

Thank you for the opportunity. And my question is related to the ODM and export, which you had highlighted. These are the two growth pillars for your business. And also, we can see that the contribution is rising, 17 and 24 percent from now. So how are you going to see the contribution of these two segments to be in the near term? And how has been the margin profile for these businesses as compared to the domestic ones?

So I'll take one by one exports. Exports last year, we grew by 40 percent. And that only shows that none of the economies we were exporting have grown by that, that we are migrating customers from other geographies into India. The Q1 has been very good. We have grown by almost like 60 percent. So I expect that this year we should grow over exports by around 30 to 40 percent. Last year, we did the exports of about 1,200 crores. So we should be able to grow the business to 1,500 to 1,600 crores for the current year. Again, as I've always been saying, let the geopolitical situation settle down. It will give us more clarity. But despite all the turbulence, we are still confident of growing the exports. On the ODM, again, it gives us a big satisfaction that ODM, which grew by 82% last year, has grown by almost 100% in this quarter. So, going forward, I expect this momentum to be maintained as my med tech and the defense business scale up. The ODM content would be at about 17% of our sales are ODM sales. The target is to take it up. The long term target is to take it up to a quarter. It's not a sort of a sprint. It's a marathon. And it will take time for us to take it up to that. And this problem or this sort of task becomes even more difficult because my non-Odean revenue is also growing at a very healthy pace. Since the pie size is increasing, and I want to increase from 17 to 25, that is almost like a 50% growth. My ODM has to grow at 50-60% level to be able to reach that 25% target in the next several years. Short term, 17 to 18 to 19 will be the target.

And on the margin front, sir,

or you can give some color

on the Odean contribution of the segments, which like healthcare or, you know, industrial more contribution.

The Odean family would be healthcare, it would be defense, it would be consumer, and little bit of industrial.

Thank you, sir, and all the best.

Participants, in the interest of time and fairness to others, please restrict yourselves to one question. For any more questions, you may rejoin the queue. The next question comes from the line of Bharat Shah with BCS Capital Ideas. Please go ahead.

I did not really have a question to ask, but I just wanted to state my observation. Over many years that I've seen Sirma, and through many different phases of challenge, and when chips were down, I think the firm has displayed remarkable strategic restraint, strategic intent, and its execution without wavering by the short-term considerations. I remember a period of about two years back when things were materially confused, as far as the externalities were concerned, and there were a lot of challenges. The quarterly numbers looked like lottery margins were going heavier, and the top line was fluctuating quarter to quarter, but with little clarity as to what it is. But throughout this period, I've observed our strategic intent has remained firm. We have remained steadfast and not second to the temptation of any loose picture being given. We have remained scrupulously transparent. So I just wanted to put on record my deep appreciation of the way the firm has evolved. And I also must thank and appreciate Vijay Agatwal, who must have gone through a lot of challenges in managing on a much smaller balance sheet, financial constraints and working capital challenges and very low ROC that the business faced to contend with the high growth.

Thank you, sir. Thank you, sir. I would just like to follow up to your comments. I would just like to reiterate that what we are in SIRMA focused on is in building an institution. And we have to balance the short-term and the long-term, but never, ever would we compromise the long-term for the short-term. I think that focus is very, very clear. We'll rather absorb the pain, the short-term pain, but we'll never, ever compromise or sacrifice the long-term objectives of the management and the board, which is to build an institution which is truly global in nature. Engineering late. And focus on very sort of tight execution and generating free operating cash costs. Tight capital allocation policy.

Thank you, Varadha.

No, no, absolutely. Just one point, if I can check with you. While opportunities abound, our capacity and capability both are rising. Looking at a greater pace, actually, what, in your opinion, could be emergent threats or challenges, may not be today, but over a period of time, or any areas which you think are strategically very vital, but which are not visible today?

Well, I can only say that I think we in Sirma and I think the industry for the benefit of the country has not taken on a philosophical level. I think we have to be very cognizant of the fact that long-term sustainability does not come in from plain Manila manufacturing, whatever be the vertical. It has to come from design. It has to come from engineering. So earlier, the companies invest in that. They are secure in the future, and we are very, very focused on that. We know this business of manufacturing would continue for the next 10 years. I'm not having any doubt on that. But what we have to learn from China is that while we are harvesting the sort of produce from manufacturing, we should not sacrifice the long-term vision of investing in technology, in engineering, in design, and end of the day, India has to become a product nation. Now, the product may be of the brand owner. The back-end technology has to be with companies like us, which develop products, develop technologies. And that is where I think everyone should be focused on what are the areas which may become future. I really can't say as of now. Data centers is a big buzzword globally. Let's see how it stands out. It is opening up big opportunities for manufacturing currently. Long run, I really can't say on that. Semicon is another business where we in India, I think the majority of the companies will be focusing on the assembly and the whatever part. The design part is where the cake is, where the cream is, and then the facts. So we have to see how we get into the higher margin profile within the Semicon ecosystem.

Very correct. Thank you, Gujarat, sir.

My pleasure. The next question comes from the line of Rahul Maheshwari with Ambit Investment Advisors. Please go ahead.

Hello. Good morning, sir. Congratulations on a good set of numbers. Two questions. First, while deciding or coming on board with any JV or any partner, what are the top three criteria as you look at? What are the top three criteria which the partner looks in you? And second question is, can you give some customer...

I'm sorry to interrupt, Rahul, your voice is breaking. Could you please speak?

Yeah, I lost the last part of your sentence.

Can you hear me now better?

Yes, better.

Yeah, so first question was while deciding any partner or going with any JV, what are the top three criteria you look into the partner and vice versa which the partner looks in you? And second question is, while onboarding any customer, what is the gestation period, and can you give some kind of wallet share gain that is happening in a long period from the last three to five years? These are my two questions. Thanks. Okay.

On the first part, I think we have always been very clear and sort of communicating with all the people that we enter into joint ventures or we acquire companies in areas where we are not present to fill in the gap of technology, regulatory approval, or maybe market access. So if the joint venture cannot bring any of the three things, then what's the point of entering into a joint venture? So a joint venture will be entered if the partner brings in something which I don't have, which could be technology, which could be access to a particular ecosystem, as we have said, the Japanese ecosystem. We have access to some regulatory approvals or areas where we are not present, and that's why we acquired Elcom. We were not present over there, and rather than reinventing the wheel, we thought it better that it would be better to acquire and sort of scale up that business. So those are the technology, market access, or regulatory tools is what we look at in forming any joint venture or acquiring any company. Normally, we will not acquire a company which gives me additional revenues, but not one of these three strategic sort of entry points. On your point of the scaling up of the customer, there are two sort of cases in this. One is where a mature product is being transferred to us. There the scaling up time could be 12 months to 18 months. Closer to 12, but outside 18 months. But if it's a new product, which is yet to be validated in the market, this 12 to 18 could stretch from 18 to 24 or even 30. So, there are two different case studies. So, we have seen that customers are migrating mature products to us, but the ramp-up is about 12 to 18 months because he has to phase out from his existing line or ramp-up with me. I hope that answers your question.

Yeah, just an addition to it, what kind of market share a particular customer you have increased up to? Because he also would be diversifying his entire chain. So can you give some idea on that part of that during the years, what kind of a game you have done in his entire ecosystem?

Again, the global customers and the domestic customers. In global customers, when we enter their supply chain, I think we are a very small, insignificant player when we enter. Because if our company, as I say, has spent a $1 billion on electronics and they supply 120 crores, For 150 crores, it's what? Not even 2%, 1%. So there, it could slowly and steadily go up to 4, 5, 6, but I don't expect with global companies it could go up to 40% in the 5 to 7 years because they are very entrenched in the supply chain. But the volume being so large, even if you have a 2, 3, 4 percent share, it could be $100 million worth of business or $50 million worth of business. On domestic customers, typically we are either the number one or number two vendor. Very rarely we will be the number third vendor with my customer. And the endeavour is always to keep increasing the wallet share, and we have increased the wallet share with the existing domestic customers. Increased the gap between the one and two, and if we are number two, we have reduced the gap between us and the number one.

And how much would we domestic customer and global customer next?

See, my exports is about 25, 24, 25 percent. So, 75 percent is my domestic customer.

Thank you so much, sir. All best wishes. Thanks.

Thank you. The next question comes from the line of Tane Shah with Dam Capital.

Please go ahead. Yeah, hi. Good morning. Thank you for the opportunity and congratulations on a great set of numbers. Sir, I have two questions. First, obviously, you've highlighted in detail about the supply chain restrictions which, you know, the industry is facing. But given that, Ian, we focused on inventories as a strategic asset, let's say, for the next couple of quarters, do you see any risk to achieving the current guidance which we have? You know, while you said that we will exceed the guidance what we're doing, is there any risk to the current estimates which we at least are projecting for ourselves for FI 27?

See, I would answer this question with a caveat. On a micro level basis, on my demand side and my execution strategy, I don't see any risk. It's a tough choice. I'm not saying it's a take walk. It will be a tough walk, but we won't achieve what we have guided or exceed what we have guided. The only imponderable is the geopolitical situation in West Asia, and which is beyond my control or beyond control of anyone. If tomorrow it was to again escalate further and cause some significant damage to the supply chain capacities, well, then not only me, but all the competitors, all the industry, everyone will have to bear the punch. So that's the only improbable factor on which I believe I'm not competent to comment what will happen.

Sure, sir. But it was just more from a perspective of, you know, the particular bare PCB shortage which we're seeing across the industry. And, you know, what we understand is that even single-layer boards are something which are going into shortage. So do we feel like we're covered for the year wherein we, you know, see no risk from a delivery perspective? I understand the demand is, you know, strong.

When you say cover, it is not that for the next eight months I have the inventory stocked in my factory. We have the orders, we are in constant touch with the vendors, we are in constant touch with the suppliers, or whatever, to ensure that whatever has been committed is given to us. But again, it's a hypothetical question. If one supply of chemical was to come down to zero, then the entire industry, global industry, will come to a grinding halt. I don't foresee that situation, but it's a constant tug-of-war, and I think, as I said, we have set up a separate war room in our company to only tackle all these shortages and ensuring that the supply chains are maintained. So, it has been carved out of the material or the supply chain team. So, they have 100% focused only on the critical items which we believe could have an impact on us.

Sir, just one last, if I can squeeze in. So, the core industrial portfolio, right? I mean, obviously, in industrial, we also have the defense contribution. I'm not sure what the number would be, but if we were to exclude that, you know, the growth would surely have looked moderated. So, how do we see that industrial portfolio going into FY27, the growth? And I mean, we know that we're going slower on smart meters, but any other outlets of growth if you can sort of highlight out there?

I think you have hit the nail on the head on the smart meters. I'll ask Vijay to delve on it.

Sir, right here, last quarter, the defense maritime business contributed approximately 140 crores into the industrial business of about 460 crores. This is excluding that it was about 320, and this quarter also excluding that this is about 325 near about. So there is actually this entire sequential election which you are saying this is primarily because of the different maritime business, which is much more seasonical, or maybe you can see it is much more rear-ended loaded in a way. So that's one. But again, in totality, industrial business is growing. It's a very decent pace. A lot of new businesses like we have been adding into this particular vertical, Specifically, the fuel injection system, and maybe the utility metering business that is also growing. Only the Indian smart metering business, which is also the uptake there, is slightly lower in last two quarters. And we are also deliberately keeping a watch on it to keep our working capital under control there. So, that's how this particular vertical is going.

Got that. Thank you so much for answering my questions and wishing you all the best.

Thank you. The next question comes from the line of Santosh Sheshadri with Evendus Spark. Please go ahead.

Thanks for taking up my question, and congratulations for solid numbers. So my first question is on the divisional growth outlook over the next couple of years. You have been mentioning that the company as a whole could grow at 30-35% age, and you're already exceeding that. Could you help us break down how the different business segments are likely to grow and which divisions do you expect to outgrow the company average? And also, is there any possibility of any new segments or sub-segments emerging, given the opportunities that you mentioned within the semiconductors and data centers value chain?

Okay. So, I'll take this question. First, on the growth part, we have already said that this year we should be not only achieving but exceeding what we have got yet. So it is 35% plus growth rate for the current year. And we maintain that for the coming years, that is 27, 28, 28, 29, at least for the next two to three years, we would be able to grow at this percentage going forward on a higher So, the business, the clients which we are onboarding, I think they have a tremendous potential of maintaining this momentum of the growth, if not increasing it further. I think you must appreciate, everyone must appreciate that the global clients, when we onboard, they take two years to start giving decent figures, and it's only in the third year that the real growth happens. So whatever export growth we are witnessing today is the effort of the clients which we have onboarded in 23, 24, 24, 25, and 25, 26. The clients which have onboarded in 25, 26, they may contribute something in this year, but the real contribution will come in 27, 28. And we have onboarded several global clients which have a big potential of giving revenue. And these are spread across automotive, industrial, METEC. Automotive remains to be the cornerstone for growth, led by the EV. EV is seeing a surge because of the fuel price increase, all the figures are in public domain, the way the EV industry, vehicle industry is growing. And we are well integrated into that system with the electronics on the vehicle and the charging infrastructure. We have also sort of growing significantly in the coming years, this year it may not be very big, into the ecosystem of the data centers, which would be the power management and the cooling systems for the data centers. We are beefing up our Bangalore facility and dedicating certain sort of areas to cater to this business. It's early days, but we're very confident that this will scale up significantly in the coming years. Vijay, if you'd like to add anything.

Thank you very much, sir. Just to clarify, just to double-check here, we are expecting the growth rate to continue at about 30%, or did you mention that there is a high base effect where the growth could moderate?

What I said was that current year, we are achieving what we have guided rather than exceeding what we have guided. Going forward, we are very confident that at least for the next three to five years, five years is a very faraway figure, but for 27, 28, 28, 29, and maybe a year after, we are on track to achieve 30 to 35% growth rate. Today, what I said was, the global customers which we have onboarded have a potential of further giving a bit or sort of a, so I can't commit a figure to it, but they're giants. They buy billions worth of electronics, so they have the potential for us to grow at even a faster clip. But I can't comment and commit today because we are yet to start serious supplies for them and all those things. And the geopolitical situation, how they pan out in the coming years. But the trend today is that people are looking at diversifying the electronic supply chains, and India is one of the preferred destinations.

Thank you very much, sir. Just to follow up on that, on the exports, you mentioned that the momentum is very strong. So is it concentrated in any few verticals like industrials or medtech or using a broad-based fraction here? And what is, you know, beyond the supply chain shift away from China, you know, what is driving specifically this for Sirma? Is it, you know, largely existing global customers giving wallet share grains, or is it like a significant new addition on the export front?

See, on the export front, currently the composition is broadly between industrial and medtech. Broadly, a little bit in RFID, which goes into different applications, and a little bit in auto. We crossed the 120 crore mark in auto exports last year. Some of the new clients which we have onboarded belong to the automotive sector. So, going forward, I believe automotive sector, and politically, industrial, and medtech would be the driver for the export growth.

That's very clear. Thank you very much, and all the best for your future execution.

Thank you. The next question comes from the line of Arjit Shah with 361 capital. Please go ahead.

Thank you for the opportunity, and congratulations on a good set of numbers. My first question was that your presentation mentioned that your networking capital and your working capital loan increased because you have some early ramp-ups in some customers. So is that built-in in our growth, the confidence that we are seeing of increasing growth from 35%? Does that also include that or is it just first quarter performance that gives you confidence? So, that can be more achievable on the ramp-up.

Borrowing increased primarily because of higher working capital investments and mainly led by higher inventory carrying right now in this quarter. There was a certain supply chain constraint and also faster ramp-up of the customers. On the faster ramp-up side, this is primarily on the consumer segment. That's where we are seeing a higher consumer segment mix in this quarter and higher volume mix for that particular vertical year. So, here, generally, like, instead of portfolio, even distribution, we have seen a faster ramp-up from a few of the customers here. And also, on the auto segment side, the customers whom we have onboarded last year, this quarter, some bit of a faster ramp-up. We are expecting from those clients seeing their order book visibility now. That's where we are preparing for the same.

That answers your question?

Yeah, sorry, just a second question, sir. Where are we on defense segment right now? What could it be of overall contribution in this year and next two years? How can the ramp-up look like? Are we also getting new customers on our own onboard, or we are only relying on customers that Elcom has?

So on the defense vertical, I think it's early days. It's just been six months since we have acquired that company, majority stay. We are very confident that going forward, This sector, defense portfolio, would continue to give 30%, 35%, 30%, 25%, 35% growth rate. So we are, as I said, we had acquired a platform for the defense, I think. We are in sort of dialogue or search for beefing of the portfolio in this company. So we would not, in the coming three to five years, will not rely on the existing, only on the existing offerings of Elcom, we would definitely be adding more sort of technologies or offerings to the menu, and so that we can cater to a broader spectrum of customers. Early days today, I think, let's wait for six to nine months to have a better grip over what all we'll be doing in the defense. Short term, we'll We'll be growing on the portfolio of Elcox, but we'll be definitely adding more products and services or offerings for this Elcox.

Okay. And so just one last question on this current quarter's growth in auto and also 100% in healthcare and 6-day consumer. Within that, is there any particular customer to be of increased wallet share or is it just early ramp-up in consumer?

And also, which I think we are seeing a big traction in the EV, and the growth has come from expansion of business from the existing customers, plus adding a few customers, which will significantly grow in the coming quarter. They may not have added too much to this. One major growth area in the automotive is charging. You classify it as automotive? Yeah, automotive charging. That business has seen a headache compared to the last year. So, very bullish on the automotive sector, and with the addition of a global customer, not in this year, but in the next year, we expect that this sector would continue to see this strong traction. On the consumer, Vijay, I think you have the details.

So, automotive, yes, EV is growing faster. So, that's where we see a lot of new customer onboarding also, and the business growth also together. The consumer, again, our telecom business is growing in this quarter. This has shown up the faster or early kind of schedules here in this quarter. Apart from that consumer business, our Odeon business also has grown into the customer consumer segment here, which is more of a water purification business. That has also shown a good traction into this quarter. Similarly, on the MedTech side, apart from the MedTech business, this quarter, our RFID solution business going for MedTech end-use or health care end-use has also grown significantly. And on the industrial segment side, I have updated that smart meeting business is slightly lower in this quarter, but power supplies are good, and defense is also going to be subdued in this quarter. Most importantly, IT sector business is also growing at a very partial pace. There are a lot of IT assembly businesses what we are currently doing. We are also targeting to do the domestic motherboard manufacturing also. We also have a CDAC in our favor which helps us or maybe which we are eligible to design and manufacture server motherboards also, which we are already in the process of working with few select clients on.

Ladies and gentlemen, we will take that as the last question for today. I would now like to hand the conference over to Mr. J.S. Gojral, Managing Director, Sirma SGS, for the closing remarks.

Thank you, and I think Q1 has laid the foundation for a sustained growth in the coming quarters and the coming years, and as we have all the time been saying, that we are very focused on execution. And I think that has started paying results, and we should be reaping even better benefits in the coming. Planningment is very, very focused on building our institution, and we have our internal plan for the next five years, where we want to be, what we want to be. And we are going in that way in a very structured and strategic fashion. The geopolitical situation continues to be an area of concern, not for us, but it's a global thing, and I think if the industry, despite these tribulations, is able to demonstrate a healthy growth with margins, I think full credit to the industry as a whole. I'm speaking from the industry point of view, not from the company point of view. Apart from that, I think we have focused greatly on ESG, and though not mandated, we have been awarded the gold medal by EcoVegas, which rates us among the top 5 percentile companies in terms of ESG. So we're very sort of mindful of our responsibility to the society and environment. Again, not mandated by any recognition, we have signed up with SBTI, its initiative based out of England, to set our targets for emission and carbon footprint for the next 10 years. So our team is in dialogue with them to set the targets. I think one point would highlight the whole thing. We have a senior executive, president-level executive looking after ESG. So that, I think, shows the intent Kenya management team, led by the board, has encouraged to integrate ourselves with the global supply chain. The work in progress is to further beef up the ODM business. Now, I'm only talking of the existing EMS business, a beef up the ODM business, and we are strengthening our capabilities in that sector. Thank you. to the bandwagon till we are sure about the credibility of the partner, because it's an industry which is sort of notorious for its requirement of deep pockets and fast-changing technologies. So we don't want to burn cash and our fingers or whatever until we are sure about the credibility of the partner. We are currently in dialogue with several of them, but since nothing is concrete, I am not in a position to commit anything. But I can only commit the management is focused that we should be a part of the semi-con supply chain, but within the sort of red lines drawn by us. And I think our team has done a phenomenally good job, and I would like to, through this medium, thank the entire team of Pyrma SDS. And all the value partners, whether they are our channel partners for supply, for technology, the bankers, and everyone, and last but not least, the investors who have the post-confidence. We had a tough couple of years in the beginning, but I think the worst is behind us, and we are well on track to be one of the recognized Indian global EMS companies. Thank you very much.

Thank you, sir. Ladies and gentlemen, on behalf of Access Capital, that concludes this conference call. Thank you for joining us, and you may now disconnect your lines.