lj Nandan ‘One world with denim 4 March, 2017 To, To, BSE Limited National Stock Exchange of India Limited Phiroze Jeejeebhoy Towers, Exchange Plaza, Plot No. C/'1, G— Block, Dalal street, BKC, Bandra (East), Mumbai ~ 400 001. Murnbai ~ 400 051. Scrip Code: 532641 Scrip Symbol: NDL Dear Sir, Sub.: _ Transcript of Con call held on 10" February, 2017 Pursuant to Regulation 30 of the Securities and Exchange Board of india (Listing Obligations and Disclosure Requirements) Regulations, 2015, we enclose herewith, a transcript of Concall with Investors and Analysts which was held on 10" February, 2017. You are requested to kindly take the same on record. Yours faithfully, For NANDAN DENIM LIMITED Purvee Ri aN Company Secretary (Mem. No.: F8978) Nandan Denim Limited (Formerly known os Nandan Exim Limited) (CINLSI909EN1994"LC022719) Plant &Regd. Ottice: Corporate House: Savy. 19,2032, Sofpue Gopalpu PiaraRoad po Aadabad- 382408 ipa! House, shianon! Coss Roads, Satelite, Ahacbed - 380.015, n.2491 9079200199 Websie:yonunendendanm.com Enolivo@neandandenm.com ins o7o-2eraascoras ex 079-2676865%Nandan Denim Limited Earnings Conference Call February 10, 2017 ‘Moderator: ‘eur Prakash Deepak Chripal Good! evening, Ladies and Gentlemen. 1 am Lzann, the moderator for this conference, ‘Welcome to the third quarter and first nine months FY27 Results Conference Call of Nandan [Denim Limited organized by Dickenson Seagull R. At this moment, all participant ines are in the stenonly mode, iater, we wil conduct a question and answer session. At that time, if you have a question, you may please press“ and"! an your telephone keypad, Please note that this conference is being recorded, | would now like to hand the conference over to Mr. ‘Arun Prakash Thankyou and over to you, Si. {Good evening everyone. On beh of Olckenson Seagull IR let me welcome you sll to the Eaanings Call of Nandan Denim Limited fr the third quarter and nine months FY 17, Today, ‘we have with us from the management Me. Deepak Chiipal, the CEO; Mr. Ashok Bothra, the CFO; and Ms, Puvee Ry, the Company Secretary. Before we get started, | would like to remind vou that our remarks today may include forwardooking statements and the actual resute may difer materially from those contemplated by these statements. Any forward lacking statements that we make on this cal, are basad on our assumption as on date and we undertake no obligation to update these statement in the wake of new information or social events, | would now like to hand over the floor to Mr. Oeepak Chrinal to make his opening remarks Over to you, Sit. Hello everyone, goed evening, Ladies and Gentlemen, Greetings and very warm waleare to ‘everyone present here for the earnings call of Nandan Denim United for third quartar and first nine months of financial yesr 16-17. We are happy to inform you that we have suceessfily complotee eur capacity expansion plan offs. 612 crotes This Included expansion of our denim capacity fram the exiting level of 70 milion meters per annum to 130 milion meters per annum, adding a shictng capacity of about 10 milion meters per annum and bbachwarl integrating by Inereasng our spinaing capacity from 70 tons por day to 124 tans per day. Our deri manufacturing capacity of 120 millon meters per annum now makes us Indias leading denim manufacturing player. Further backorard integration will help us meat significant percentage of our yarn requirement in-house, which would not only increase our margin, but will also give more controf on our supply chaln and will enable us to delver superior service and quality to our customers in Form of higher quality dani fabric and on- time delivery. Page 1 of 12‘Moderator: Rona Rathi: Deepak Chirpa: Ronak Rathi: Rona Rathi: Deepak Chip Coming to our performance during the thied quarter, revenues from operations declined by 18% yearonyear to 238 crores primarly due to diffu operating conditions, 35 a result of emonetization, Gros profits decined by 24% year-on-year to 72.5 crores and gross margins ected from 33% to 30.8%, We witnessed higher raw material prices as the industry supply chain foced alficlties post demonetzation. EBITDA declined by 34% year-on-year and {EBITDA margins declined from 16.79 to 13.5% on account of lower rovinucs PAT dectned by {40% year-on-year to 88 crores and PAT margin decined fiom 5.4% to 3.7% The operating concitions gradually started improving from danuary and we batiove that denim market should normalize over coming quarter. Overall we are fairly optimistic en the business front in the next fiscal 3s our expanded capacity wil help us strengthen our domestic market share 26 well a expand our global foot print. Our endeavor would be to achiove 2 double-digit growth in nancial year 2028, along with improvement in our operating margins. We would continue te focus strongly on expanding our value-added denim offerings. With this, | would ‘now like to hand over the cll forthe question and answer session. Lacies and gentlemen, we vill now begin the question and answer session, We take the fest “question from the line of Ronak Rath, an inevidual investor. Plessego ahead. My question i, we have already ended capacity expansion, so do we have Wentiind ‘sstomers who wil be taking value-added products from us ori there any kind of marketing that has boon already done ori itn progress? ‘Yeah, 25 for as market is concerned, we find that there wil be enough market and there is existing market In terms of customers, only thing fs that we will now start focusing categorically en both domestic as well as export, and hopeful, over a perlog-of ime, we should be in the ight mix Whats the expected utlization of eur capacity, after she demonetization things gets norma, 0 for our capacity addition that we have completed, when can we expect the 100% tization be achieved? \We expect that by month af Marcy the plant should normalize, because things have started locking up and in the month of February, we are targeting to reach maximum capacity level and in the month of March, we are tying t streamline and stabilize the operations, We ‘expect that in 17-18, we should see the real bonefits and complete maximum utitzation for the whole year. ‘Alright, Se. How isthe exert market looking for denim and value-added products? Export matket aso, ince the project has been completed, now the entire focus of the team and Company is towards marketing and establishing the Company's brand image In the ‘market, Hopefully this year we should See significant improverments in brand andthe value= Page 2 of 12Ronak Rathi: Deepak Chiipal: Ronst Rathi: Deepak Chiripal: Moderator: osha Hara Ashok Botha: osha Haria: Ashok Bothra: added segments, So this year we ae putting In a lat of efforts and lat of planning has been done and team building has been done. Ths year shouldbe a good exercise, but ! would sayit Is only noxt yar that we wil reap the benefits. Ths year, we are doing lot of ground work, 30 the real benefits will be vsble only next year, though this yar we will soe improving trends, but next year we wil se good rests How much percentage we are expecting {com oxport market in terms of domestic and export revenue, could you give usa breakup? Revere wise, as uh right now it’s about 15% from export, 85%'s domesti, but our target Isto roach about 30%. As such, the company is not under any pressure of achieving this 30% umber, but inthe long run we feel that this is @ goed mix, so a8 such we ore working ‘owards that, however, looking atthe market sconario and looking at the prfitabiiy, we keep changing this is, but curenty whore we stand is 85% domestic ~ 15% export, and we ‘want to get to 70 domestic 8 30% export in coming years. what tke In terms of margin, export market, does it offer much better margin than the domestic market? Ital depends on which market and which type of customer we cater to. As Isa, capacity wise, demand wise, company Isnt having any Isue, now we want to target how we can offer batter product profile to our customers and servien the customers. The transition has to bbe done at both the domestic as well as on the export front, so as far as our capacity is concerned, | would nat sat sto big. a capacity to sel so there is no dearth of market, only tioingis an issue ‘Thank you. We take the nest questin from the tine of Resha Haria from Greenflge Wealth Services. Please go ahead, ‘Actually, | missed the opening remarks, so apologs fit sa repetition of what was already shared, can you sare the volume and value numbers for denim and shirt for the Q3? 186.3% came from denim and 7.4% came from shirting the rst I from athers ke power and fuel Basically, there was an 38% degrawth inthis querter, so what would that be attributed to, ‘would it be deranetization alone or would it also be some other factors that are in play? ‘This is mainly due to demonetization impact How are you secing the sales recovering in January, February? Market has started improving from sanuary and things are looking wp. Page 3 of 12esha Hela: Deepak Chirp: esha Marla: Deepak Chiipal: esha Hariat Deepak chiripal: esha Hari: Deepal Chirp esha Harla ‘As | said, like eecond half of January things started looking up and now this month we are having sufident orders, so we are in the process of streamlining the plant operations now: Now that we have full capacity post expansion and so the endeavour isto bring back the entire copacky Ia production and I hope that in the month of March, things should stabilize And so the real benefit a sald wi be visible next year but things have started looking up, so hope by the menth of March things should normalize ‘even in 4 and 2 basically, on a top tne level, we had grown in single cigs, sist that the denim incustry pet se has slowed down ar Ist that there is alt of competition, that, over ‘capacity inthe Industry, but the demand isnot there as much so what really the reason that othe rst half of the year also, we have seen a single dt growth? ‘Acti in the ist haf, we have not seen any growth | think it was around 2% a 3%, so really there was not too much growth, but now in December or inthis quarter anly we have completed the proposed expansion, s that expansion will add new capacity and that will be ‘isle, only I would say inthe noxt quarter Because this quarter wil goin streamlining things, next quarter definitely we wil i inerease in volume, ‘what were the factors that keto a single alt growth in the first al f the fancial year? Because there was no capacity alton. There was as such no significant capacity addition on ‘the fabric front, of course, project was going on but as such the eapacity did ret become operational You are saying primarily that CA onwards we can probably expect a double digt revenue growth? Uke say, If we tak about February and March, | think the entre plant will become ‘operational Ite inthe precess of becoming operations. Now things are sot of streamlining and becoming stable, £0 | hope by month of March things should normali and stabilize, so ‘the next whole year we wil see the entire benefit. hope that next year We wil se @ good Improvement nthe top line 2s well as bottom line, We basally sell to distributors and dealess, 50 fs that inthe form of cash or how are the payments received? Thore sno transaction that we doin cash evarything is through banking channels ony. In terms of the entire supply chain, so basally these dstributers when they sell it to these. ‘trade channels, that would be in cash an that fs where the whole demonetzaton impact has been there? Page 4 of 12 iDeepak chiripal: esha Hari: Deepak Chiripal: esha Haris: Deepak Chiripal: esha Hala: IF we understand the supply chain, we ave I to dealers, dealers wil ethor give it to resellers ‘or gatmenters, and garmenters wll convert into garment and they wll further give it to say leaders or retailers and tals wil in turn soll itin open market. This show the entre chain works, so If we ge backwards then most of the sales must be happening in cash at the retail ‘end, so they must be paylng in ash to the garmenters or traders and they in turn must be converting from cash to cheque or whatovor but ultimataly by the time itcomes to company, everything becomes cheque. This quarter, we have seen a dip in the gross margin, sos It because there has been some change in the product mix or fs that the cotton rsa has ad tothe dip in gross margin? Ire not because of cotton prices, primarily | would say itis because of the demonetization cifect ts a simple fundamental of economics, when there fs oversupply situation, where there is not enough demand in the market, obviously the entre industry comes under pressure, The prices also had to be reduced during that phase because of supply pressure. would say that also had an impact, The uel prices increased drastically because that was an Intemational phenomenon, similarly color chemical and crude-based products, they also had some increase, labor and similarly If we talk about the fed expenses, they aso hed = negative impact on the balance sheet, because they were 2s Is fied, if we understand the manufacturing process, lot af expenses are fired, in any case if there isa reduction inthe top tine, few have @ negative impact on the profitability would not say thata single factor has played 2 role, but el things compiled together i culminating into what we soe and specially ‘when there is les-emand situation, then we have to curtail the production, the efficiencies ‘of the plants go down, so when the efficiencies go down, abviouly the conversion costs go op. ‘Now in January and February have we all witnessed thatthe pricing power has sot af come back or the average realizations have come back tothe loves of pre-cemonetization? Now this quarter what we are seeing Is that there has been a drastic Increase in the raw material prices, the eatton prices have gone Up by 7-8% In this last one and one-and-a-half months, 30 now we are tying to pass en that increase or may be a part of that Increase ro four customers. Market has started opening and demand is improving, but | think it wall be another one and one-and-=-half to two months before the entire cost impact can be passed ‘onto the market. would say this March quarter ill go in streaming and stabilizing things, things are looking un and are going towards normalization, but | would not say it has happened today, but | would say in snother one month time things should get streamed and it should return to the previous scenatio. We expect this year to be 2 good year because fortunately the entire channel ae far as the buyer channel is concerned, it & all emoty, whatever i the demand atthe retail end, itil give 2 good boost forte textile fbr Lastly, what was the average reallation in 3? Page 5 of 12Deepak Chivipal: esha Marla: Deepak Chiripal: ‘Shallosh Kumar: Deepak Chiripal ‘Average ealztion was around Rs. 222 which ear used to be about Rs. 139, so that is what | said that prices had to be reduced under supply pressure or demand pressure whatever, we hha to reduce the prices a bit, so average realization also has gone daw forthe company. Now things are improving, so agein we are trying to increase the price, some of it has been effected, balance il be done in next one month, ‘Olay, if the cotton prices remain at this elevated level, typically wat isthe lag with which these elevated raw material pris are passed onto the customers, so it one to one-andha- half months? [As such, I would not say there is any theory because It all depends on the demand supply situation ike what happened during demonetization there was no demand, so even though aw mataril prices were stabi, the finished yoods prices had to go down, What happened in January was, even though the raw materal prices wore increasing, the finished goods pices did not increase, | would say ial depends, but now since the market is looking up and the cost has aeady increased, | would say about two months isthe maximum time because by then, the entire channel or all the competitors or all the players In the market start feoling the heat, by that time definitely | would say, either partially or the entire impact has to be transferred to the customers, so maximum | would says about two months, but by that time ‘ether partial or complete impact is transferred depending on the demand and supply situation ‘What would be your cotton stocking policy, you stock Inventory for how much tne? As such, we are not very speculative on cotton, so normally what we do is we keep about two rmocths’ stock, so If we are having an optimistic view or if we find a raly in cotton then we would ineoase it by a month’s time and if suppose we find a bearish market, then we will reduce ft by @ month's te, so that is how we go. Nocmaly, we do not speculate much on cotton, Thank you. We take the next question fram the line of Shalash Kumar from Sunidhi Securities. Please go ahead. {just wanted to know what Kind of volume expectation is there fr full year FY27 and FYB in toni, khaki, and shirtings? [As far asthe next yearis concerned, ! would not say this year we will see any improvernentin ‘the top ine because ofthis fala quarter, but otherwise, if you tak about next year definitely wwe sheuld cee about 158 improvement in the top line, the only raason baing that tha 15% ‘capacity which has heen added, soi wll add to 15% and when | say 15% Lm not including the average sales price improvement that we should also concurrently see in the coming yesr. Page 6 of 12Shailesh Kuma Deepak chil ‘Shailosh Kumar: Deepak Chieipalt ‘Shailesh Kumar: Deepak chiripa: “Shailesh Kurt: Ashok Both Shallesh Kumar: Ashok Botha: shallesh Kumar Ashok Botha: Shallosh Kumar: Sasialy thisis the volume growth we are expecting? Volume growth is about 15%, would say 3,4, 9% should also be Inthe selling price, to about 20%, 15-20% Is what | would say improvement inthe topline, I would see next year. ‘what has beon average cotton price during the quarter and nine month FY47 for ws? | have not calculated tat number, but a¢ such | would say we were nat badly hit because | think fortunately we took some Umely and right decisions which turned aut eght, so as such we ware on very much safe footing, | would say as such we were fortunate to cove at east 60-70% of our requirement, so we were not that badly hit compared to some of the ather players [As far as value-added products are concerned during the quarter, what percentage of cur sales came from value added products? | do not have that breakup that this much is value added, because as such distinctively we do hot have a tag that a product is value aed ané this prosuct Is commodity, so ey are our ‘own tersrinology, there is no industry defind terminology that this i what we call value added product and this what we call the other preduct, but as such we understand that there ‘are products which are commodity and there are prosucts which are value addad, then thera ‘are lot of grey areas, which are commodity or which are valued addod which become commodity ever a period of time. There are lot of grey areas. Now, the important thing how much we ean shift fram one profile to the other, so that is where we ara working towards, and hopefuly as we work and as the team gets better at it, we will see good numbers and we ate quite optimistic and we see 2 lat of opportunity, so think the nest year should be quite exiting for Nandan and wo aro quite bush ‘We have allotted some warrants to Polus Global Fund at Rs. 200, what is the status ofthat ‘warrant, has it ben converted or we 2r@ yet to haar from them? Youtore talking about 5-28, which wo got? Yeah got converted in May 2016, entre 50 crores. Latest round, thas been dropped, another SO crores? 100 crore was the plan for fundraising which we dropped. Some housekeeping question, Me. Sativa, for wine months FYA7 what has been our average realization fr the denim? Page 7 of 12AsholeBothra: Shailesh Kumar: ‘Ashok Botha: ‘Shailesh Kumar AsholeBothra: Shailesh Kamae: Deepak chiripa: Shailesh Kumar Deepak Chiripal: Shallesh Kumar: Deepak Chiripal: Shatlesh Kumar: Deepak Chieipa: eis around at the same evel 136.1372 Yeoh, ‘0¢ay, and what has been our sales vlums or the ne months? Itis around above 55 miton ‘What hs been our captive yar produetion for nine months FY372 | donot tink we have calculated that exact number, Itcan be shared on request, sorry to sy we are not having this number. # would say now that project has been commissioned, the entire capacity is Becoming operational, so once the entire capacity is operational and becoming streamlined, 90% of our yarn requirement will uacome backward integrated ‘Cam we expect this 90% of yarn requirement ta be produced in-house in FYI? let happen inthe month of February ar latast by March, The entire thing we should get the benefit | think by February we should have that kind of pumber, esaservatively it could become March, but etherwise this whole year, ofcourse we are gong to have good top line, 00d hottom line and 8 should be 2 goodyear for us ures the GST plays havoc or something like that, that is the only risk factor, Demoretization created havoc in the demand, $0 shilariy GST plays havoc then itis. a rk, that would say i threat ‘This strength in cotton prices which we have just abserva from last month, do you expect ‘this strength to hold up say for next three to six months! period? Personally speaking, { would say | an very butsh on eatton. I would expect the prices to only move upwards because as such the entie spinning industry In India fs running fll siing and ‘the cotton proction, | would not say has Increased much in the previous year. There was a huge rally in cotton scenario 20 | would Say this year also, 1 expect the cotton prio to mave up unless and unl the industry as a whole ties te Import ction, which I do not see a this point of time, sal expec this yes to hea frm year for cotton. In that ease, we asa company and denim industry, are they able to pass on the ful increased censt tothe utimate buyer? ‘Ast said, cause now its onl nthe last 15 days that things have started improving ard we have started ramping up the entire production, slowly things are Improving and part oF it has aeady been passed on to the consumer, balance would be, hopefully, we should be able to do iin the next couple of weeks oF may be end of month. Hopeful, further increase does Page 8 of 12Moderator: ‘Arjun Singh: Deepak chiipal: ‘Asam Singh: Deepal Cheipal: Arjun Singh: Deepal chiripal: rot happen in cotton pries, then in the month of March we should see Uhe equation balancing ‘Thank you. The next question is from the line of Arjun Singh from Rellance Mutual Fund, Please go ahead. Sir, you sai that you typlealy hold two manths of eottan stock, but you aso sald that you are ‘olish on cotton prices, my question i that are you planning to increase your stock? Yes, we are planning to increase and we have already started that process, s0 for two reazons; one isto procure good quality fiber and secondly of course wa feol that may be in coming months the prices could frm up soto basicaly take a pre-emptive step. 'ecause fram what | understand, the production this year hasbeen higher than last year, but the arrival hae boon slower, that is the reason why cotton prieas are higher as arivats Improve, the cotton prices should gradually go down, do you agree with that argument? Now, | do not think the prices should go down, ane reason Is that as per our estimate I think 50% of the cotton has already arrived and the reason for slow acral has boon \demonetization, 30 there was no currency, that &§ the reason. | think the antval should inmprove in coming, months, but as such as | said you know 50% ofthe arrival has already happened, so normally by month af March, the entire process is completed so there could be maybe one or two months’ delay tis time, and If you notice the spinners, they are also not cotryng too much stock as far as the raw material is concornod, Even ifthe prices go down, there are buyers. 1 do not see the prices going down, but once the good news comes efinitaly | see upward possibilities, so now the only thing which can bring down the cotton prices, would say, Idella, so FFthe dollar comes to 63,64, 62 levels, ofcourse, the imports will become much cheaper and exports become no more lucrative, so that could reduce tne ‘demand for expert and that could increase the Import posses, that would definitly bring down the cotton prices for sure but otherwise If the dallar position romains inthe range tfc operating in right now, even If the arrivals improve, may be 1%-2%, 3% prices could correct but no dtaitic improvement; Ido not se like 10% or something, | do not see those kind of possibile, maybe 19%, 2%, 396 you never know and that could also not stay on for very long, may be that could happen for a few days or something, again it will improve becouse there ate lot of buyers and people are not carving that much invantory and the whole year has to be full In your raw material basket, what percentage would be synthetic fers? Symhetic bers, | would say shout 20%, Ide not have oft hand, lam just ving a number, ts less than 20% may be 18%, 17%, bur defintely nat move than 20% Page 9 of 12‘jun Singh: Deepal chiripak stun Sine Deepak Chiripal: ‘Aun Sing Deepak chitipal Arjun Singh: Deepal chiripal Ashok Botha: Moderator: Harsha M: Deepak Chicipat: ‘Secondly, you said that you commissioned your new capacity in Decomber, so with this your ‘denim capacity is actully Increasing more than 50%? No, 15% because eatier our capacty, thet was before we Implemented this 612-crare project, the capacity was 70 millon meters, now it has become 110, sain totaly you se it 1s more than SO%, but if you see last year It Is 15% because this project, we were Inmplamenting since las three years. Okay, soit was 95 milion meters ast year? Ifyou see eater | thnk the turnover was about 700 crores and now last year we did 1256, 0 this year ofcourse because of this problem we dd not see any improvement in the turnover, otherwise, this year also we would have seen soine improvement but next year we will ofiitaly seo 15-20% Improvement on this L156 number. ut of your total alas, what peccantage would be direct sales to brands? Direc sales to brand ia very all number, I would say about $-5% 7%, Last time wen we had spoken on the call you ssid that you want to improve your brand portfolio which should lead to improvement in margins, so whats the progress on that? {As | sid, now the entire thing has become operational so entire focus is towards changing the product mix and changing the customer mis, so lot of team bulding has been done and there's alot happening in this rection, so hopefully in 17-18 we will see good improvement, 1am quite optimist Currently, what s your net debt and your gross cebt? |wiljust pass on tom, dota, he willshare the numbers. Long term debt is around S00 craes and working capital mits around 185 crores, utituation |sappronimately 70%. “Thank you. The next question Is rom the lin of Harsha M from Photon Pease go aheas. Ay question has been answered, just have an extension tothe previous question, so what Is fur planon the debt, going ahead? Pian of debt going ahead is to reduce debt, it will only go down. Now sinee the projec hes been completed, so whatever debt had to come on to the balance sheet, it has already been absorned, so going ahead as the repayments happen, which are already happening, i wil reduce year-on-year Page 10 of 12Harshe Mi: Deepak Chiripal Harsha Ms Deepal chripal Harsha Me Deepak chiripal: Moderator: onal Rathi: Deepak Chiripa: Deepak Chirpa: onal Rathi owe have any target ice asin FV18? | think this year we would say shout 65 crores would be ropaid. inBea7 ist? 17-28, becouse these numbers are alrady shared with you so I would say this year another {55 ores would be repaid, so overal debt wll come down by about 10% I would say, working capital, term loan put together, so overall 10% wil be recuced, Another question what is our avorage cost of debi? Average cost of debts 11-12%, ‘Thank you. We wil take the next question from the line of Ronak Rathi, an individual Investor Please go ahead Sir, my question ic hw much in terms of percentage, will bo the cost of cotton in your overall costing? | would say that should be about 35.60%, | would not have the exact number because we hve bath cotton and synthetic, £0 some products also use synthetic, | would say total raw material costs about 70% son that we have cotton as wellas yarn as well as synthetic 30 as such we do not have a separate breskup of cotton, but | would say that number should be about 55-60%, ‘Okay, and generally the volatility inthe prices of cotton In mest ofthe cases, i it posible for usto pass onthe same tothe buyors,custemers? Now it all depends on demand and supply, 2¢ we make ft of products, in some products you know they can be easly passed on, in some products It becomes very dificult, in some products we can partially pass, soit opends on what kind of products the company makes and how much it can sel in those prodvcts, so tall depends on pined effet, and normally, | \would say this year f wil bea good year so since the entre channel is empty, theres 2 good petit forthe fabri, so | would say this year should be a good year and since all are on the level playing fel, all the suppliers, nobody is carrying any inventory, everybody Is Feetng the heat. | think most oft should be passed on ts the final customer, sot will get passed on, lag ‘of may bea month or so but | thnk itshould be ultmatelytronsferred. You gave a forecast of around 20% growth in tap tne, if you could just give some sort of forecat for bottom line figura, ke how much growth in percentage terms can we expect for Sinandal year 17-18, bottom line? Page 11 of 12Deepak Chitipal Ronak Rathi: Deepak chi Ronak Rathi ‘Deepak chiripalt Rona Rathi: Deepak chieipal: Moderator: ‘run Prakash: ‘Moderator: | ould say EBITDA margins will definitely improve, so baring this quarter, earlier it used to be in the range of 16-16 5%, so we definitely expect this to bea better number than this now how much better 1 would really not threw 4 number, but defintely when the top line improves and when the company is focusing towards more proftable segments and product, then ofcourse these things should improve. Secondly, also since the entire capacty has been implemented, commissioned, and now becoming operational, so thase kind of ‘benefits also should accrue tothe company. Definitely EBITDA margins wil inirove and more ‘thon that the PAT of the company will Improve. State government tenets wil also start [getting accrued for the companies, so the PAT wil also improve further. It will be a good umber, it wil definitly be an encouraging and good number, et us hape it is 38 per our expectation, | would not like to elzclose the number, but definitely It will be 3 good Improvement ‘what are the state government benefits that wl be availed by the company? ‘There are two kinds of benafits, ane is the interest bonafit so about 5% onthe debt, we get the interest Benet which fs Interest subsidy or Interest reimbursement and ako we get the \VAT rafund, so some VAT refund should be avaled this year, so those are the two things \which wil become addtional forthe company this year. Oofnitely, it will have an impact on the bottom Ine “This 5% interest subsidy benef, wil be accrued in fnanclal year 17-18 from that year ‘enwards, am |eorrect? Exactly, the whole year we will et this benefit twill continue fr how many years? Five years. “Thank you. Ladies and Gentlemen, that was the last question. | would now like to hand! the conference aver to Mr. Arun Prakash for his closing comments, ‘Thank you all fr participating Inthe earnings call. Ploase get in touch with Us incase yoU need any further information on the company. Our coordinates have been provided in the calliqvite that has been cleulated, as well sn the presentation. Thank you very much. Ladies and gentleman, with that we conclude today’s ennfarence, Thank you for joining us and you may naw disconnect your lines Page 12 of 12