Xpro India Limited (XPROINDIA) Q4 2026 Earnings Call Transcript

Ladies and gentlemen, good day and welcome to the Xpro India Limited Q4 and F526 earnings conference call. As a reminder, all participant lines will be in the listen-only mode and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing star and zero on your touch-tone phone. Please note that this conference has been recorded. I now hand the conference over to Mr. C. Bhaskar, Managing Director and CEO. Thank you and over to you, sir.

Thank you, moderator, sir. Good afternoon, friends. I extend a very warm welcome to all participants to this Q4 and F26 earnings call of Expro India Limited. Many of us would have interacted in the past. Nonetheless, I introduce myself once again as C. Bhaskar, Managing Director of Expro India Limited. Today, on this call, I have with me Shri Girish Behl, our Managing Director, Designate, and CEO, Shri Vinay Kumar Agarwal, our President, Finance, and CFO, Shri Kamal Sevda, our Company Secretary. We are also fortunate to have with us Shri Himanshu Bakshi, our Senior President and Group Technical Council. You may have had opportunity to interact with some of them also over the past few years. MUFG InTimes, whom many of you will know as OrientCat, our investment relations partner, is as always coordinating this session. We are continuing the practice commenced a few years ago of hosting this annual conference call for our investor community, the intent of keeping investors, analysts, familiar and updated about annual results and key developments. As many of you have already had the opportunity to meet on earlier calls or at the AGM or in our occasional investor meets, I shall not dwell on reintroducing our company. I must add that we are transparent in our approach, but must state that all discussions here will be within boundaries reasonably imposed. As you are all aware, Expro India Limited is a diversified, multi-locational company primarily focused on polymer processing with extremely strong governance standards. The company is family-led, and it's a professionally managed arm of... One of India's largest and most reputed industrial houses, the Great Life. Xpro itself currently has manufacturing facilities at Greater Noida in Uttar Pradesh, Ranjan Gaon in Maharashtra, and Barjora in West Bengal. It's a subsidiary at Russell Khaima in the United Arab Emirates also. Our operating units have built up special skills and competencies. In the specialized field of co-extrusion, the application in the manufacture of oriented films, multi-layer plastic sheets, and multi-layer cast plastic films. Thermoforming supports downstream of processes for sheets. It is important to note that X-Pro is not, I would like to emphasize the not, a packaging products company as we are often considered to be. It is rather India's only significant manufacturer of specialty plastic products, particularly polypropylene dielectric capacitor films, precision-engineered ultra-thin films, 3 micron to 16 micron, that form the core of capacitors, exciting areas of EV inverters, solar systems, wind turbines, industrial drives, and so on. Driven by technical precision, quality, and development strength, besides customer qualification cycles and support, H-Pro has faced well global competition without tariff protection to become the premier supplier in this part of the world, especially without any tariff protection. Our results for the financial year 202526 just gone by, together with quarterly results, have been uploaded on stock exchange portals, and you may have had an opportunity to go through our press release that we had uploaded to the exchange site and also on our own website. Coming now to a quick review of key business matters. The Reserve Bank of India recently characterized the global economy as navigating elevated uncertain mounting downside risks. The unresolved West Asia conflict continues to disrupt energy infrastructure and supply chains. Global trade is being reshaped by tariffs, policies, and strategic restrictions. Even as global growth may hold up, input caused pressures, flight-side constraints, and erode that resilience. Nonetheless, it's important to mention, RBI noted that India's macro-fundament has a strong footing. Facing it in a better position stands short. My apologies appears we had some static. I would go back to where I was, emphasizing that, nonetheless, RBI had noted that India's macro fundamentals are on a strong footing, placing it in a better position to withstand shocks. For Xpro itself, financial year 2526 was a year of positive transition. A defining development was the commissioning of the new dielectric film line at Barjora, which entered commercial production on 27th March, 2026. With the new line now operational, the company has entered 2627 with materially expanded capacity and a stronger platform for volume and export growth. Commercial ramp-up of the new line is now underway, and its full line will be reflected commensurately. With regard to dielectric capacitor films, as most of you are aware, the company operates in a product and process space that is fundamentally different from BOPP for conventional uses. Polypropylene dielectric film, mainly for capacitor applications, is a specification-intensive and precision-driven, and the industry is limited globally among a select number of producers. Building credible scale and reputation in this space requires technical capability and discipline and consistent product quality. Attributes our BIAX operations have developed systematically, earning a strong standing among discerning clients with a first-mover domestic producer advantage. Interestingly, the demand backdrop is structural, not cyclical. Electrification, renewable energy build-out, grid modernization, electric mobility, and traction systems all place a direct and growing premium on film durability and dielectric performance, long-term capital development cycles that consistently reinforce end-use demand. Product development is directed deliberately at the highest value in... Ultra-thin, hazy, and semi-rub films for power capacitors, EV systems, and railway applications. These are also high-entry barrier segments, technically demanding, relationship-driven, and margin-supported. Our performance remains stable within the available capacity. New customers and applications are being onboarded for the new capacity. While management continues to focus on driving volume growth and enhancing margins, while pricing has to remain dynamic and flexible to retain market traction in a frequently volatile scenario, even at the risk of occasional impact on markets. Capacity additions are sharpening the company's trajectory. The new dielectric clamp, which I, as I just mentioned, was commissioned in March, meaningfully expands domestic capacity while extending reach into premium performance-critical variants, including ultra-thin gauges where differentiation is sharpest. In the co-ex business, co-exant sheets and thermoform refrigerator liners are manufactured on multiple lines. Available with the COEX division at Ranjan Dao and Greater Noida. Our products are usually custom-made to customer needs and based on various polymers, including ABS, polystyrene, and PP. Being an established supplier to most leading brands in the refrigerator sector, volumes are directly correlated to the consumer and market conditions. Following an exceptional Q4 last year, volumes during a year moderated, reflecting a temporary slowdown in refrigerator production, partly attributed to early monsoon conditions. Revenues were affected by both volume decline and software raw material prices. Despite this, strong customer engagement enabled the company to continue gaining market share. We believe the, as an incidental comment, we believe the extra warm, hot conditions we are seeing in northern India right now would augur very well for this segment. Considering Q4 performance, the revenue from operations during the quarter was Rs. 134.37 crores against Rs. 158.21 crores in Q4.25. PBT for the quarter was Rs. 16 crores against Rs. 11.5 crores in the corresponding previous quarter. Bayat Division reported a sales revenue of INR 39, very close to the INR 39, very, very close to the INR 39.3 in the corresponding previous quarter. Coming to the full financial year 202526 performance, the company reaffirmed its operational resilience in the volatile business environment marked by supply chain worries, rising costs, geopolitical tensions, underscoring the efficacy of our operational strategies and the competitive trends. Aggregate production volume declined 5% to 31,335 metric tons from 33,014 metric tons. Net revenues were Rs. 505.5 crores, down 5.6% from the Rs. 535.28 crores in the previous year. Fundamentally, you will see this reflects the volume fall in the refrigerator, sheet, and liner production. Total exports were higher at Rs. 22.5 crores against Rs. 14.20 crores. Profitability was impacted overall by competitive pricing, input cost volatility, significantly exchange movements, and pre-operating costs associated with expansion. PBDT, Profit Before Non-Operating Forex Differences, was Rs. 63.7 crores against Rs. 67 crores in the previous corresponding year. The Forex exchange loss was Rs. 11 crores. Of which, Rs. 11.14 crores was unrealized, resulting from accounting standard requirements versus a gain of Rs. 1.49 crores in the previous year. This translated in all to a PDT of INR 41 crores against INR 58 crores in the previous year. I must mention that there are no outstanding long-term borrowing for existing operations. However, we had, from a financial perspective, particularly interest servings that should approve in future years, gone in for supplier credit in the nature of ECD for financing the new line installed at Barjura. We have already commenced repayments and two repayments. In fact, as of date, three installments have already been repaid. While the – during the financial year, the net debt to equity stood negligible, actually, and delivered a healthy return on equity on the expanded capital of close to 5% and a return on capital employed of over 5.3%. The board has recommended for member approval a dividend of Rs2 per equity share on the expanded capital. The paid-up equity capital of the company stands at Rs. 23.47 crores, while the net worth is at Rs. 715.48 crores. All outstanding warrants were fully converted during the year, and 11,70,000 equity shares were allotted. All the capital raised through the preferential issues and the QIP is being deployed for stated purposes. With Rs. 74.63 crores held in bank spending utilization. Deployments are independently monitored as required. A quick update on the status of capacity addition. As already mentioned, the capacity at Bhabjawra has already been in commercial operations since end March. The project in UAE is broadly on track. Geopolitical conditions in West Asia remain fluid with the ongoing regional conflict, contributing to heightened uncertainty, elevated costs, and intermittent disruptions to trade and transport, with risks amplified whenever hostilities persist. However, most of our key equipment is already at site and is in advanced implementation. There has been no disturbance of any significance in the Algail area where our site is located, and project execution remains at an advanced stage. Barring unforeseen circumstances, commercial operations are expected later during this year. Management, of course, continues to monitor geopolitical developments and take appropriate risk mitigation measures. An important issue, sorry, I would also like to add that the accounts of the subsidiary essentially represent preoperative expenses, capital advances, and utilization of foreign supplier credits for capital expenditure. During the year in compliance with applicable accounting standards, The company was required to record a total loss of UAE's RAM, $4.52 million, in a significant part due accounting for foreign exchange rate movements, amounting to $1.95 million. As we had already announced, we had taken fresh equity to the extent of U.S. dollar $9 million into the subsidiary from a well-known A very significant AD participant, and that has been fully received and is being used only for growth. Another important issue that I wish to dwell upon, Exploender Limited has taken the next step in a planned succession in its executive leadership, which aligns with the company's next phase of materially larger ambitions. To ensure an orderly and seamless transition, the Board, after due process, has approved the appointment of Shri Girish Behel as Managing Director from January 1 to 027, subject to the approval of shareholders. In the interim, Shri Behel has been re-designated as Managing Director Designate and CEO with unbroken executive responsibilities for his present charge. Shri Girish Behel, aged 47, and thus with a long career ahead of him, brings a well-grounded foundation to the role, with commercial skills deepened by significant operational and domain experience in polymer films, including direct business leadership in oriented films. He joined Expro in 2024 as the head of strategy. And is well positioned to lead the company to its next phase of scale and strategy conversion. We wish you well. With this, I open the floor to questions and answers.

Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question, press star and 1 on the touchstone 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'll wait for a moment while the question queue assembles. The first question is from the line of Tej Patel from Neveshaya. Please go ahead.

Yeah, hello. Perfectly, sir. Perfect. Thank you so much for the opportunity, sir. Sir, I have a couple of questions. First is two things. If you could help me understand, you know, what was the mix between COEX and BIX this quarter, and, you know, the same number, what was it, you know, Y and Y for the last? And along this question, sir, if you help me understand, you know, for what I understand was there was some, you know, increment which we did in prices for the dilatory films in the last quarter. So was there an inventory gain that happened for BIAX this quarter? Just this is the first question.

Just give me a second. So your two questions are the mix between COEX and BIAX?

Yeah, in this quarter versus the previous financial year of the same quarter, and was there any inventory gain in the bias division?

Okay, let me first turn over. 134. See, the turnover in the BIAX division, the dialect itself, was pretty much similar. It was in the range of 130 crores to 134 crores. So, not dramatically different, fundamentally because the operating capacity throughout the last year was more or less flat. The COAX division, in fact, went down in turnover. Because of reasons which I'll just elaborate again. And therefore, if you see the mix, the mix of dialectic terms in the overall mix of the company actually went up. But that was only because COEX went down slightly. Just one second, I'll give you the exact number. Yeah. After it was 75%, 25% turnover, this year it is 71%. Okay, now your second question. Yes, there are pricing fees efforts going on. There are multiple reasons for it. Reason number one is that as we had mentioned earlier throughout the last year in earlier calls, we had taken a strategic decision and had worked towards a slight softening of prices. In anticipation of the creation of new capacities, this was even before there was significant competition in the Indian market. But right now, there is a steep increase in prices going in places, fundamentally reflecting the replacement costs of the polymers. As polymer prices have gone up steeply following the West Asia crisis due to shipping disturbances and, as you can imagine, sympathetic reactions to the instability in the petroleum markets.

I've got it.

The gains that you are talking about, inventory gains, should accrue in the future because, yes, we had inventory, but I think that's a slow increase that will have yet to come along.

Got it. Perfect, sir. Follow up on your answer only. Is it possible for you to give the answer only? Got it. Sir, one follow up on your answer only. Is it possible to give the per kg realization in the bias division for this quarter? And, you know, what are the prizes hovering right now, I mean?

The prices are moving up steeply, and in fact, the prices go up literally every alternate week, I think, today, and that's, I think, in keeping with what's happening to just about every commodity. It would not be correct because it's a highly competitive area, and this is an area of global competition for me to tell you specifically what prices are today, but I can tell you typically modal prices are now in excess of 550 rupees a kilo. I'm just throwing a range.

Got it. So, is my understanding right? This quarter, we had a, I mean, there was probably a very little inventory gain which was happening, but probably from Q1, in Q1, we could, you know, see a huge inventory gain because of a steep increase in price.

Let's talk about huge inventory gain because I think you must appreciate also any kind of so-called inventory gain is always short-term and not really fair because remember, we are not traders. They are manufacturers. And manufacturers have to be concerned with the continuity. So I have to look at the replacement cost of anything, because if I have to consume a kilo today, I have to replace that kilo, because I am going to be in existence tomorrow morning also. A trader view would be different where they would look at it as a trading game. So any gain of that kind is shocked on, really.

Got it. Perfect. And, sir, what utilization are we expecting to close on with the, you know, the recently I did line of Ed Barjura? What utilization are we expecting to close this year, right?

Production there, and we would certainly target to an at least 50% utilization during the year, if not more.

Sir, sir, are customer approvals for that line in place, or is it yet to be done?

Customer accruals are never line-wise. Customer accruals, by definition, are company-wise. We are selling a product. We are selling a dielectric film in that business. The manufacturing point is purely internal to us, and we will obviously go by manufacturing convenience in allocating between lines. So, to say, is there a customer for a line is not a correct question. Yes, we have customers. Yes, we have customers who want more material than we have been able to supply so far with limited capacity. And those same people will be the customers for the new line, besides new customers as we develop them. Remember, a capacitor is a specialized product. So, you know, it's not like Coke. If I advertise, I might get a new customer. For a capacitor film, only a capacitor manufacturer already existing can be a customer. I hope that's clear.

Yeah. Sir, one more follow-up on this. We're just trying to understand your view.

Can I request the moderator to just check his queue? I'm okay to take questions, provided we are not disturbing something in a queue.

This would be just last one follow-up. I will just join. This would be just last one follow-up. I will join. Thank you. This is the fall-on question to the answer. That's why. Sir, hello. Sir, so you said 50% is probably what we are targeting. I'm just trying to understand why couldn't it be more because, I mean, why could we could not the existing supplier, let's say, you know, double their sourcing from you. I'm just trying to understand. But given that, let's say, the yen is also, you know, appreciated against us. I'm just trying to understand. Is it a production problem? Is it a ramping up problem? Or you are still yet to find enough demand to, you know, get it completely utilized?

I've understood your question. Let me answer. This is neither the forum or the place for me to give you my marketing or production plan. So, you asked me what capacity utilization would we expect. I took the middle-of-the-road approach and said 50% at least. Now, 100% is also higher than 50%. I said 70%. So, obviously, I'm not going to disclose my production or marketing plan, right? I think you are aware, what are the lead times in this business, there's no, it could be anything. So, I'm actually not getting into a marketing plan, no?

No problem, sir. I will thank you for the answer. I will join in the back of the queue.

Thank you.

Sure, sir. Thank you.

Thank you. Ladies and gentlemen, in order to ensure that the management is able to address questions from all participants in the conference, please limit your questions to two per participant. The next question is from the line of Sanma Jain from Kamayakya Wealth Management. Please go ahead.

Yeah, hi, thank you for the opportunity. So I had a question regarding a new line. So how is the pricing and competitive landscape from imports shaping up as we ramp up this new dielectric line?

Sorry, I didn't get your name, sir.

Sanmat Jain.

Sorry, boss, I missed that again. Oh, okay.

Sanmat Jain, yeah.

Yeah, yeah, got it, got it. Thank you.

So, I think the competitive landscape for the pricing has, again, nothing to do with a line or a B line, right? This is a new line, and so it's more important is what is the competitive landscape like and what is the competitive pricing like. These are the imports. We do not anticipate a serious competition or a serious threat from global pricing. Fundamentally, two factors. These are specialized products, and when you are in a specialized range, the kind of competition that you would see from international sources is limited or restricted. More important, given the current uncertainty in the forex markets, I think that itself acts as an impediment or a barrier to anyone sourcing important material. The alternate of indigenous material is available, which is also on a quicker delivery schedule.

Yeah, yeah, it does. And that 50% ramp up you said in the previous, to the previous participant.

Mr. James, let me add, I tossed the number of 50%. Don't take it to be up and fast 50%. As I said, I said at least 50%.

Okay, so any time frame?

No, no, I said that when Mr. Patel asked. Terrified that. So I was just saying, don't say the 50% ramp-up. Ramp-up could be more.

Thank you. That's it for myself.

Thank you. The next question is from the line of Mahesh Atal from Dehria Investment Advisors. Please go ahead.

Sir, wow. At afternoon, you will be... Sir, I believe. So, sir, at what level will be EBITDA positive on our second line? At what capacity?

Mr. Atal, you will appreciate that's not a number to be answered on a call or in the public domain, because fundamentally that will depend on pricing, and as you know, we are working hard at the pricing impact. So, at the EBITDA level, at the EBITDA level, I think you are also aware that this particular business has a relatively high EBITDA delivery.

Right. But you must have worked on some capacities, right? I mean, when you say that you will be doing 50% at least.

Oh, certainly we have worked on capabilities. Certainly we have worked on any number of scenarios. Sir, you will kindly appreciate that some of those are certainly not for the public domain, because it would hurt us in the competitive landscape.

Very well. Second would be, sir, the validation of your product from the new line. So, how do you see the validation from your customers and how much time does it take from the time you deliver them the samples and they telling you are maybe commercial orders coming, flowing at your end? And when you say, I think, further to this question, you have intimated in last call that this line would be mostly for the, I think, the Dubai line as well as this line. I don't think you have any Indian customers buying ultra-fin film today. So, obviously, you'll export. So, how much time it takes for certain export customers to validate your film? Are you already sending your samples?

So, your questions are multifold. So, one, your question is how much time does it take for validation with customers? I'll address that separately. Secondly, you have assumed in your query that we will make only ultra thin films on this line, which also I will address. And, therefore, you've asked, Would we be forced to export because we will be focusing only on ultrathin films? So let me start with that point. This line has a core specialist capability in the range of upwards of 2 microns. It does not necessarily, it's ideally designed for 2 to 5 to 6 microns. That does not preclude it from producing higher microns. Therefore, it is not necessarily correct. To say that we will export all that we produce on the film. Yes, initially, the thin films produced will go into export markets because those are ready markets.

Ultra-thin films consumption in India is still negligible, and it's just growing.

It's just picking up. Having stated that, it stands to reason that we would sell in the Indian markets also, and also export. Yes, I believe you had checked with our company secretary sometime, and he had probably told you that our initial consignments were export, but that was more out of choice. Or maybe he didn't tell you that, but I believe you had contacted him. The answer to your query then would have been that our initial lots were exported. Because we wanted to start with exports, fundamentally my earlier principle that we learn more out of exports on certain reactions that we get, certain new applications. Having said that, time for validation of these kind of firms could be anything from zero to months, depending on the specific customer and the specific application. Each customer has a different test cycle and a different standard of requirement for each of their capacitor applications. So there are two factors into it. Who is the customer and what is the intended application? There are some applications where standard approvals of the process are needed, are adequate, without long-term or more exhaustive trials. So, obviously, we will pick those customers and those product segments as initial supplies while the trials and testings are going on. And the focus area initially is to build volume. So, once the volume builds up is when we will go to pushing UHD in India, UTF in India. I hope that answers your question.

All right. Sir, have you...

Sorry to interrupt, Mr. Mahesh. May we request you to return to the question queue for a follow-up? Sure. Thank you. The next question is from the line of Raghav Mittal from Dhamma Capital. Please go ahead. Hi, Raghav.

Good to see you on the call also. I think we've met in some investor meet.

Yes, yes. I hope you're doing well.

Thank you, Raghav. I hope you are.

Thank you. A couple of questions, Mr. Bhaskar, is one, on, say, the two lines, so line two and line three, what are the expectations of when does the UAE line potentially start commercializing? And maybe just looking out, say, FI27, FI28, what kind of volumes do we expect to be able to maybe supply from these two lines combined, FI27 and FI28?

Sure. Interesting. Okay. So, if I first take the Ewing line, you are well aware, Agam, that right now the world is in an absolute turmoil. Therefore, any statement I make is tempered by what some gentleman does tomorrow morning or later this evening. But apart, the situation in reality is that... We expect definitely to be well into trial production by August, September this year, current rutting, unless there are any, I'm talking about the UAE plant, unless there are some shops that come along. Which is uncertain. Now, how much would we be operating? Again, uncertainties are global situations. Uncertainties will continue to be what happens in the polymer markets, what happens consequentially in consumer markets. But realistically, since you are talking about next year, we hope to have full capacity. See, I would never distinguish between what would be line 1, 2, and 3, because ultimately we are selling a product and a class of products, let me say, which could be produced on the line of convenience rather than anything else. You know, we would bunch production, those kind of things. But having said that, we would like to believe, or we believe definitely that the two lines in India next year would be in full production, and let's say, again, the UAE line would be in excess of a 50% capacity utilization during U4-27-28, right?

Right, so FF-28, we're saying, or FF-27?

Sorry, Raghav, your voice broke.

Sorry, are you referring to FA27 or FA28?

I'm saying 2728.

Okay.

2027, 2028.

Understood. Understood. And what would you say, would you be more worried about today? Is it the raw materials, availability, raw material pricing, or just... There's newer players entering the market, say an SRF, and then there's one more guy in Gujarat who's also sort of putting up a line. So what could be the concerns that might, you know, not allow us to sell 100% of our capacity in FA28?

So, Raghav, in reality, and this is a statement you would have heard me make several times, we encourage healthy competition because the market is good enough. Whatever studies have been shown that the world is going to need many more lines, even by 2030. So, good, healthy capacity is welcome. Having said that, any new capacity will take its stabilization time. A newer player, not new to A-capacity films, and not new to oriented films itself, would probably take a little bit more time. Maybe one day more, but it would probably take a little bit more time. So that is not such a great area of concern, given today. Now, if another 50 lines come in, yes, that would be an area of concern. Thank you. The real area of concern today is the impact arising from the West Asia crisis, the consequential impacts on availability of petroleum downstreams, including polypropylene. And more so because the grades that are needed for this product are highly specialized, highly specific grades, not manufactured in India, even though India is a large polypropylene resin producer. They are mainly packaging types. So that is the concern. And that concern is amplified by the uncertainties in the forex market. Now, normal principles are, about any product that we make, by and large, pricing is a pass-through pricing. And pass-through pricing, I mean, whether it's only us, whether there are competitors, the principle in industrial products is pass-through. However, pass-through pricing sounds very nice, but at the end of the day, somewhere there will be a price in elasticity. It could be in the infrastructure end. It could be somewhere. Somewhere it has to hit. You know, even if it's governmental purchases for infrastructure, somewhere it will hit. Now, that and the larger economic situation, I think, are the biggest areas of concern today. To answer your question, there isn't a biggest. There are at least two. One is stability in the West Asia and in free trade, resuming, let me say by free trade, I mean more free transport, coming back to where it was, and a little bit of stability in the forex markets globally.

Please, sir.

And just lastly, Mr. Raga, may we request you to return to the question queue for a follow-up question? Sure. Thank you so much. Thank you.

Thank you, Raga.

The next question is from the line of Manan Shah from Moneybee Investment Advisor. Please go ahead.

Yeah, hi. Thanks for the opportunity. Good to see you.

I said good to talk to your team again.

Yes, yes, sir. So, I wanted to ask, say, two years out, what sort of mix do you think the two micron and the thinner fins can form out of the buy X revenue? I mean, or would you try to build a business, say, two or three years out, what percent of revenue contribution should we look from these thin micron fins?

You know, and this is, it's not only for us, it's a global situation, and I think this is something I have stated often, it would be absolutely unrealistic to assume that 2 to 3 micron is going to be your model mix in the foreseeable future, and I won't even say 2 to 3 years, right? It's got to take its time. That said, our effort is towards going down consistently in the modal thickness. From a modal thickness of 8, 9 micron, just three, four years ago, I think it's already gone down through the 6, 7 to 5, 6. We see it going down to the 4, 5 very soon. So, more likely that a modal thickness, and I'm only saying a major average thickness, would probably go sooner in the 2-3 year period to a 4-5 micron. Increasing supplies in the 2.4 or the 2.7 to the 4 micron range also.

Is it reasonable to assume that we can derive 10% of the volume-size revenue from the 2 micron or 3 micron films?

Our development efforts are certainly towards more than the number you mentioned.

Okay. Secondly, on the raw materials side, how are we placed now? Because you were saying that despite, you know, placing orders, they refused to deliver on the price that were committed. So, how are we placed now, and what sort of visibility do you have in terms of raw materials procurement?

So, I think at any point of time, just being an imported raw material, we like to make sure we have at least three months of stock in the plant. So, even as I speak today, we have more than three months of stock. And as material becomes available, we are booking. However, you will again appreciate some of it comes from, a good bit of it comes from the European side, and certainly shipping is going to take its toll there. If not on delivery, certainly on time and price, shipping costs itself.

Okay. And this is one bookkeeping question. Have we capitalized the third line as well in the current financials? No, no. We have capitalized the Bajora line. Okay.

To the extent of about 240 crores or so. We haven't yet capitalized the R&K line because you can do that only after you declare commercial production. So, it's all work in process.

Okay, okay. Thank you. I'll get back in the queue.

Thank you. The next question is from the line of Tia from Sapphire Capital. Please go ahead. Yes, you are, ma'am.

So, what the case are we targeting in FY27?

Sorry, I said you were audible, but then locked you just as you started.

What apex are we targeting in FY27?

Okay, so during 2627, I think the biggest single chunk of capitalization would be the RAK plant. And any adds-on, add-on, if we decide to do any value-added bits at the Bajora plant. At the co-ex operations in Ranjanga and Greater Noida, yes, we would have CAPEX, but that would be more modest and out-of-routine nature. We don't have another new line that we are going to be able to capitalize in this year for sure.

That will be in West Bengal.

No, no. We are capitalized. No, sorry. We have already capitalized in March the new line in West Bengal. The next line that will be capitalized will be the one in Rasul Khaima sometime in the middle of this year.

Okay, and you were going to shift to the higher margin segment. So, when are we planning to do that?

We already started working towards that, and I think the question that a couple of speakers just before you asked, they were referring to something called ultra thin films and 2 micron, 3 micron films. Those are all part of their higher value add products. So, those answers hold valid for your question also. Besides which, yes, there are certain ticker films, which are also higher value-add, which we have already started the supplies of.

Okay, sir. Understood. And I'm assuming you will not provide any guidance.

Sorry, ma'am. Not provide. I missed your last bit again. I think it's a little bad line.

Any guidance for revenue and margins for this year?

Providing our guidance yet. When we do, we'll certainly share it in the public domain.

Okay, sir. Thank you.

Thank you. The next question is from the line of Kaushal Sharma from Equinox Capital Venture Private Limited. Please go ahead.

Hello, I said I'm available. Yes, you're perfectly on it, Koshit.

Yeah, so my question is on your dielectric film market, like most of these specialized films has been imported from outside India. So what is the pricing differential between X-Pro films and the imported dielectric films? And is there any major difference that the government may take entry-rumping action and all in this? And what is the current Indian demand for said And dielectric fins and from which countries in India are importing a large chunk of dielectric fins. So, could you highlight in this more on industry aspects?

Okay, Kaushik Ji, your question is actually almost an encyclopedia of questions, but let me try to address whatever I can. Yes, sir. As far as the markets go, this particular product, and especially what Expro manufactures and Expro's own positioning, is a global product. So, by and large, what we are producing, what we are offering, on a like-to-like basis, is comparable with the international product. What I'm trying to say is there is... The product finds an international market and therefore an international price on a like-to-like basis. Price variations, you may see, would only be penetration pricing from somewhere or the other or quality or specification different pricing differences. Global markets that supply to India include China, include Korea. And very, very little bit coming in from Europe. But these are also mostly, mostly, coming in from China and Korea, and mostly also the commodity or the standard ends of these films, not the specific high-value aspect, which actually comes in from Europe. Does that answer your question?

What is forgotten? I mean, you also asked what...

Anti-dumping, I'll give you that. So, we have stood this market for the last few years without any tariff protection and been able to face global competition even at a point of time when 70% of India's consumption was coming from abroad

on a comparative pricing kind of basis.

So, that is one. Frankly speaking, whether there is any case for anti-dumping or something is something that will have to be reviewed from time to time. That said, I believe anti-dumping will be reviewed as and when there is a threat or real dumping happening. Time will tell.

Got it, sir. And then there is one scheme like electronic component manufacturing scheme wherein some benefit is being provided to like our product. So have you applied for the in that scheme, sir? Or what kind of potential are you expecting?

We have not applied under any PLI scheme or anything as yet because our line was already on site before any scheme that was launched under the last electronics policy was available. For our next line, which we are certainly thinking of, we will certainly examine those possibilities.

And sir, this new line is just for catering the EV market and all, because this is a line which is coming for thinner films.

So, what kind of customer do we have?

Do we have any order or fresh order from EV market or any pipeline as of now that you can update on that?

I'll tell you, our customers are the capacitor industry. And the capacitor industry, capacitor manufacturing industry, supplies to a whole range of their customers, which probably covers all the segments that you are talking on, thinking about. While we supply to the capacitor industry, they give us their specifications, their characteristics, which is what we match and give them. Certainly, we are aware of some of their customer base and where our systems are going. However, you will appreciate that their customer base is their story to tell. Our customer is only the capacitor industry.

Thank you.

Thank you. The next question is from the line of Mahek Talati from Agility Advisors. Please go ahead.

Hi, sir. Thank you so much for the opportunity and congratulations on a good set of numbers. Sir, I wanted to understand, so the second line of the Bajlora has already started, have we started the sales from that line or currently have we in the approval process?

We have started some sales from there. We are also under approval of certain products, but yes, we have also started invoicing. Started invoicing, okay. You can't declare it without invoicing.

Okay, understood. We do want it. But we can. Understood. And what are the expected bid-down margins which you can expect from the second line? And bias division as a whole in FI-27 and possibly in FI-28.

Okay. I mentioned earlier that we have a new MD designate. So let me hear his view. You all heard my view on this. Girish?

Yes, sir.

Can you please repeat your question?

So, I just wanted to understand on the EBITDA margins, which we can expect from the dialectic film division in F527 and possibly in F528.

I think in any case, from the set of numbers that we have given, Bhaskarji has already indicated the kind of volume focus that we have for this year from this new line. So, at this stage, we can share this particular information with you only.

And in terms of asset era, how much delay are we expecting? We were expecting to start in June. You are expecting somewhere in FY27. So any ballpark and when can we expect the line to get started and commercial production, not the dry and wet operations, which we have been doing in the line too.

You are talking about Rasai Thaima or you are talking about Barjo Rasari?

No, I was asking when can we expect the commercial production from Rasai Thaima?

Okay, as I said, we expect to start the trials sometime in other external circumstances, West Asia permitting. We should be commercial shortly, soon thereafter. Definitely by the third quarter this year, I think.

Okay, and anything on the thin film prices, have they increased, or they are currently on the similar lines?

All film prices have increased for multiple, I mean, what we produce in India has also gone up. All certain prices all over the world are going up. They have to because of the A, because of the forex variations, because of the cost of the polymer, the polymer situation. As you probably keep reading in all kinds of newspapers, certain petrochemical-related plants have been hurt, damaged, whatever. All those things will actually cause these prices to go up a little bit more. Understood.

And I'm interested in the price increase which you have taken. Is this sustainable going forward?

Let me verify. I said that was an indicative price for Earth spec today. Prices may be higher than that, may be lower than that also, but that was an indicational price compared to what prices were prevailing earlier. Sustainability of... We are selling an industrial product. Industrial product pricing always varies significantly based on the polymer prices, exchange, etc. So those will also have an impact. We would also like stability returning to the market, and a volatile market is not in anybody's interest. So we would like likes or like prices to stabilize at a decent level. Specialities will, of course, continue to come up their premium, and that premium is something else. So price driven up due to crude, etc., is not a nice thing for anybody.

And just one last question. You mentioned that you had a decline in the volume in the Kureš division in April 26. Can you give a ballpark number how much was the decline in terms of volumes in this financial year? And can you expect the number to pick up in April 27?

You wanted to know what was the tonnage decrease in the, as we mentioned, overall tonnage decrease was something like 5%, down from 33 to 31 something. So overall tonnage went down from 33014 to 31335. As you can imagine, the significant decrease that would chunk would have only been in the co-ex, because in the case of the dielectric, we were tapped by available capacity only.

Wonderful. Okay. Thank you so much.

Thank you so much. Thank you. Ladies and gentlemen, due to time constraints, we will take that as the last question of the day, and now hand the conference over to the management for closing comment.

Thank you very much. And thank you, friends, who joined the call. Some of you we met for the first time. Some of you we are meeting again. Happy to meet you all anytime. I know many of you all have some more questions which you would like to ask, and we are happy to meet you and discuss all possibilities and opportunities as time goes along. We at Expro remain committed to consistently offer our superior quality products, backed by exceptional services to exceed customer expectations, and remain the industry leader in our chosen segments. Please feel free to contact any of us, the company secretary, or our investor relations partners, MUSG, in time with any of your queries, doubts, etc. Thank you. And I would like to once again record a welcome to Girish Bell, who is also on this call today. Thank you.

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