ABB India Limited (500002) Earnings Call Transcript & Summary

Very warm welcome to you, all. Good afternoon, ladies and gentlemen, for the Q3 2020 Analyst Call for ABB India Limited. So on this call, I'm accompanied by Mr. Sanjeev Sharma, the Country Managing Director for ABB India. And I have all my business representatives from various locations. I have Sanjeev Arora, the Division Manager for Motion; C.P. Vyas for Electrification; Subrata Karmakar for Robotics and Automation; and of course, I have G. Balaji representing the Industrial Automation as well. So -- and I also have Sohini on the call. So first of all, I think I got a quick feedback that the time which was there for you guys to analyze between the time we published and you -- who attended this call was very less. We will definitely take care next time that you -- we have sufficient gap between the 2 events, right? So -- but having said that, we always get that in this era of digital transformation, you would have already AI tools, which could probably give you those analysis right away as soon as we load the results, but I think that's a work which we'll do on both ways, right? So without wasting time, over to you, Sanjeev, for taking us through the results.

Thank you, Sridhar, and good afternoon to everyone. Thanks for joining us in this call. So I also noted the comments just made by Sridhar. So if you have time to analyze it the way you wanted, feel free to put those questions. Otherwise, our officers and our communication team is always, again, open to receive your queries and give you qualified responses as we go forward, right? So I'll give you a bit of an overview about quarter 3. And on the business highlights side, as you know, that in this extraordinary year, health and safety got even higher attention from us for managing the COVID. Anyway, we keep very high focus in this area, but we need to ensure that our employees, our suppliers, our contractors, our customers and all the stakeholders around us, we have new protocols to conduct the business, keep the business continuity while keeping everybody healthy and safe. So that was in full flow. And I think it stabilized quickly so that we could do the business in a good flow across all the businesses, and we could draw the results as you have seen published. So now the priority areas are to focus in the market segments which are tracking well, and we continue to focus on those areas wherein there is a CapEx and OpEx investments. And we continue to support those customers and their ambitions. And the customers who are kind of lagging a bit or their market segments which are lagging a bit, we still support them because we know it's just a matter of time, they will also come around, and they will be participant in the business growth. We continue to keep customer centricity. And I think that's one of the common theme across all our 16 business divisions, wherein we have unique proposition, but the customer centricity is the common proposition we have with respect to how we serve and connect with the customer. And during these times, I think you have to choose what is most important. And we chose cost and cash management as the most important element. And you will see in Sridhar's financial that there are very positive results because of how we kind of -- how we managed the cost and cash elements in our balance sheet and also in our operations and also how we collected the cash, which was out in the market. And it has given us a fairly robust position as we go forward. On the key takeaways, now given that economy and the travel and the movement is open, we do see that the demand recovery is in play. And there are segments which are really doing well, and there are segments which have become quite demanding on -- for our products and services. But at the same time, there are certain traditional segments which are still lagging for their own lack of demand and local -- lack of confidence to invest. But I think this mix is good for us because for our 16 businesses, as I tell you every time, we are exposed to about 19 market segments. So even if a few market segments are down or up, I think we have a good balance and good forward growth in our portfolio. Government investments remains key to fuel the growth, and I think that's something we recognize. And we always look where the government is supporting, which sectors they are supporting better. So we also make sure that our time and focus are spent there. And of course, our growth segments, while conventional sectors continue to face headwinds, but it's just a matter of time. I think we need to support them equally well during this transition period. On the business side, if you see comparing the traction how we are moving from previous quarters to this year quarter, so I think we have a good traction on orders relative to the previous quarter, good traction on revenues, good traction of PBT and PAT. That's very satisfying. But when we compare to the similar quarter last year, I think we still have catch-up to do. I think the market demand, if you had to use a thumb rule, not -- it is not uniform the same way in all the businesses. But typically, if you take it as an average, it's about 85% of what we saw last year. And that is reflected in our numbers as well. And we have adjusted our cost and our expectations and our operations accordingly to cater to this demand in a very efficient way. So I think we are not able to -- we don't have a single case wherein we are not able to serve well, both on product delivery and services. But as the economy is opening up and as the speed is coming to the demand, we see that the robustness is returning to demand in certain segments for us, yes. Okay. And then as we said that, yes, we are deploying new technique, and we continue to make investments because this is a good time. And that's our attitude all along our 70 years of history in the country, that doesn't matter what ups and downs come, we stay continuously, we keep on looking at the journey far ahead, and we keep on investing. We have opened up our own eMart, wherein we will sell online our electrification and motion products, which are fast-moving products. And this is a very good gateway for our customers to reach out to our products very quickly, configure them and order them online. And we hope to have a very good traction in this area. And also, we have doubled the capacity of our robotics capabilities in the country to cater to the requirement. And we already see some early orders from some customers which are rewarding our initiative as well as the capacity building in the country. And of course, some of those projects, we cannot talk about it right now. But in due course of time, you will hear from them because of customer-specific NDAs that we have because they are tactical in nature. And also quite a bit of a shift to the digital and remote technology to serve our customers. It has made it easier for customers to create higher reliability, availability, maintainability and serviceability of their assets. And also, it saves a lot of time in terms of attend to the call, analyze the call and react to the customers. And this, again, is building into the ecosystem. And it is quite a positive, which has come up during this pandemic period because these capabilities have enhanced because customers have started accepting these services from us. Again, if you look into the sectoral focus, definitely, data center, pharma, warehouse logistics is a big segment going for us. And equally strong, we see the demand from food and beverage, renewables, railways and metros and power distribution. We are still waiting for conventional power generation, rubber, plastics, pulp and paper to kind of again show demand. But I think it's just a matter of time that some of them may or may not bounce back, but I think some segments will come back. Then from the government side, self-reliance in manufacturing. We have analyzed which are the business lines which have higher local footprint or local supply chains or localization. And the ones which have a higher import, we are ensuring that we are paying due attention to those areas, and we are localizing at an accelerated pace. So that not only we keep the competitiveness, and also we have a much more expanded and robust supply chain in the country. And again, the consumption story, which will be unleashed by the agri reform. So I think it will again open up a lot of opportunities in midterm for us. I think we are keeping an eye and supporting the players in this particular area. And FMCG companies, we see there's a lot of expansion there. And we have a lot of unconventional orders coming from FMCG companies. They are investing a lot on the automation, robotics and other areas, which were not the case earlier. So automotive may be down, but then we have, for example, for robotics, new areas and new segments which are opening up, which are absorbing the technology quite well. And of course, infrastructure push is going to be helpful as we go forward. So I now hand it over to T.K. Sridhar, our CFO, to take you through the financial highlights.

Thank you. Thank you, Sanjeev. I think the performance -- overall performance relatively to the second quarter, I would say, is reasonable, given the challenges were handled -- what we handled in Q2 and Q3 and also from the fact that we have a demand acquisition yet to start in real terms and which will be visible more in the Q4 onwards, while we are dealing with the pent-up demand opportunities, which we had in Q3 results reflected, all right? So from the order side, as you see, we have INR 1,300 crores of orders. And now this is 19 percentage down compared to the previous quarter same time, right? So that when we compare it to the base orders of the last quarters, I think this fairly -- it shows a growth, right? And when it comes to the revenues, I think it's a mix of quite a few revenues, a bit of more systems, businesses coming in and long cycle products, product orders getting executed and less of service this time. And that's the story of service people not being able to visit sites to generate opportunities or attend to customers, right? It still persists on the ground, and it persists not only from our side [indiscernible], but also from the -- more importantly, the customers agreeing to take up the people for the services. So it's more restricted to remote servicing is what is there on ground. So -- and when it comes to profitability, I think we were benefited definitely by the -- a favorable ForEx, which we had in this particular quarter and also by good expense reductions, what we continue to make sure that we are agile in these trying times. And this really helped us to shore up the profitability, what you see over here at this point of time, right? And cash, as Sanjeev was mentioning, so we actually showed again increase of cash position compared to the previous quarter. And also combined, it is more or less in line with the previous year closure, what we had. And are there challenges in the market to collect cash, answer to that is still air. I think the difference which is playing out is the strong customer connect, which all operations and the sales team have. And of course, it also depends -- it also is largely prevalent due to the fact that ABB commands a bit of a more -- I mean, a premium in the market when it comes to payment and taking services. So that's how it is. So coming to the next slide, which is a summary of the P&L account, right? And here, if you look at it, the material cost has definitely increased, and that is more influenced by the mix as what I was mentioning to -- mentioning earlier, which is a 68 percentage and the personnel costs. So whatever actions which we have done in Q2, which is the April to June quarter, still remain. Nothing has been sort of rolled back and still because we are unsure about the situation at this point of time. So this is reflected with that. But when you compare to the quarter end of immediately preceding quarter, and I think that was one-time advantage what we had taken, which is not available every quarter. So that's something which is a reflection. So that if you look at it from a Q3 '19 to Q3 '20, so it's more or less stable. And we have sales in spite of an increase, what has been given on an annual increment basis, right? And other expenses actually, definitely, are lower than the previous quarter. So that's -- and here, I would say it's more of a behavior alignment with the volume changes. That is actually giving us good variation on the profitability. And also, we have a relatively [indiscernible] sort of better ForEx compared to the -- what we had experienced in earlier quarters, right? So this is overall how the profit flow happened within the organization. So I -- with this, I dwell deeper into the division-wise numbers. I think this could be of -- to the interest of you guys. So Electrification, so we have order booking of INR 492 crores, and they have an order backlog of INR 1,300 crores at this point of time. So I think the orders mainly consisted from data centers, metro, food and beverage. And in some of the distribution orders, we have repeat orders from customers. And also the launch of new products like anti-bacterials, which have really paved way for this particular order momentum. Revenue, I think it's an -- it's a strong export performance, which improved the revenues in the quarter, too, and also the -- but whereas the service-related constraints still persist. So PBIT, I think, was a really strong performance at this point of time. I think it's more driven with the capacity uptick and the cost rationalization, which is still continuing, right? And also previous year, we should be mindful that it included solar business, which is not so great in terms of profitability, and also because we also did definitely supporting pricing actions in the market. And favorable ForEx impact also helped them show the profitability. When it comes to Motion, I think it's a very resilient short-cycle business, right? And we see some revival in execution patterns as well. So we had an order book of INR 554 crores in this quarter, and they have a backlog of INR 651 crores (sic) [ INR 1,651 crores ]. And all these backlogs, both in EL as well as MO are clearly attributable backlog. So we have a visibility as for the contracts which run into the future quarters. So here, I think they had traction from transportation, digital and service businesses over here in terms of orders. And this -- and the continuous engagement of the MO teams on the ground really helped them get these base orders on time, and it has been a support for the future revenue as well. The revenues of INR 629 crores, which is there for MO, is basically driven by backlog conversion across all major segments. So that's pretty much clear, right? So we didn't have any bottlenecks in terms of revenue execution, but there are a lot of efforts to make this revenue happen, given the challenges which we have in this pandemic moment. PBIT of INR 69 crores. I think it's in, I would say, compared to the previous year, MO was given -- took an advantage of the situation in terms of enhancing its capacity utilization and also better volume and mix. Going to Industrial Automation. So I think -- let me see if I can change here. Yes, so Industrial Automation, I mean, the orders at INR 274 crores. So as we look at the curves, I think they are still facing a lot of headwinds because their customers are basically from the core sectors, right, where the CapEx decisions are still yet not seeing much of an -- a push. And that keeps them definitely on a tender -- I mean on really a challenging position over there. And hopefully, when the market revives there, and added to that, we also have the turbocharger business, which is a part of Industrial Automation, where the customer is Indian railways. And they are moving away from diesel to electronic -- electrical, electrification. So as we had said in the previous call, so this particular customer move, while it impacts Industrial Automation, it's sort of a boom for the Motion division where they get traction converters, right? So they have a backlog of INR 1,342 crores. And they are definitely experiencing deferment of CapEx decisions, right, and also while they see opportunity in new markets like water, chemicals and small and midsized projects. Revenue, INR 367 crores. It definitely increased compared to the sequential quarters. And metals and cement definitely impacted because they have flatness in the demand. And CapEx and export-related project revenue is also impacted for the same reason. So project -- and our profitability is actually -- has been quite a challenging for Industrial Automation for a few quarters and the next quarters to come because it's dependent on the demand revival. And also it has a uniqueness of running the system businesses. So when the system businesses have a procrastination of closure depending upon the customers, then it really has a challenge even in cost-of-cost positioning locally. So -- and we have a decline in service and export component because Industrial Automation had and have more than 20 percentage of the revenues come from service. So any decline in service impacts quite substantially that way. So -- and added to that, we had an unfavorable ForEx impact also impacting the same. Robotics and Discrete Automation is a nice picture to see. They have sort of from what they were in the last 2 -- call them 2, 3 quarters. They are slowly looking at some offshoots. But definitely, I think it's not the same level as what we would have expected. This is a market that is yet to catch up over here, and they are exposed to the auto Tier 1. That's basically where we find lower orders coming in from. So -- but I think on a futuristic basis, we still expect that the opportunities will emerge from consumer and electronic industries. And when it comes to revenue, they did revenue of INR 45 crores, probably higher than the first quarter as well and based on uptick in the service revenue and projects that we could do it remotely. But as we say, customer sites are still not operational and the restrictions about movement of customers into the -- and outside in the customer places. So you have a challenge as to how we service them and be closer to the customer. But all these digital means is sort of helping out all of the business teams to close this particular gap. So unlike others, I think Robotics leveraged from higher service revenue, which improved the margin. So coming to the last couple of slides, I think the composition of the revenues and the profitability and PBIT more or less remains the same with EL and MO being a major contributor to all the 3 items. I think once Industrial Automation picks up, probably, I think they would also come and recover from the position where they are. On the last -- and this is my last slide, I think if you look at this clearly, we can see that services are definitely down, right? And this is across all the segments as such, right? So with this, I think we can open up the session for question and answers, right? So over to you, Janice.

[Operator Instructions] The first question is from the line of Bhavin Vithlani from SBI Mutual Fund.

Congratulations for good set of numbers. So a couple of questions. One is a lot of the outperformance has come from the margin side, and especially, on the other expenses front. So what part of this, in your view, could be sustainable? And what part could reverse as normalcy comes back?

So Bhavin, is this the only question?

No. The second question that I had was, we have been seeing lower margins on the Industrial Automation side. And you did mention about turbochargers. So what part of the decrementals is contributed by the turbochargers? And if we take out the turbochargers, what could be the underlying margins of the other IA business? So these are my 2 questions.

Okay. So let me answer the first question. And then I would -- Sanjeev, you want to take the second, right? So second question, Sanjeev will answer. So Bhavin, so when it comes to the other expenses, if you look at it, we are in the range of roughly around about 350 million -- INR 350 crores every quarter on an annualized basis. Today, we are probably running at INR 250 crores to INR 260 crores as what it is, right? And this is within revenue, which is reduced by 15 -- 15 to 16 percentage compared to the same. Doesn't have any growth factor as such, right? So that's being the case, right, so I would assume because there are certain expenses which are directly related to the volumes. And you could look at it compared to the immediately previous quarter. So we were at roughly around about INR 200 crores last quarter. And today, we are talking of INR 260 crores in that way. So I think to me, right, so the expenses, which are discretionary spend, right, will be -- will continue to follow the path of caution. So we will not basically spend anything which is not required. But when it comes to expenses which is relating to business enhancement or operational performance, customer satisfaction, and that will continue, right? To answer to your question, I think the discretionary spend of our total expenses roughly form part of only 20, 22, 25 percentage. And that's the place where we play with, but other expenses are definitely along with the volumes and the negotiations which you get for the volume increase because you are on the supply chain leverage. Over to you.

So on the Industrial Automation side, I think if you really look at Industrial Automation, we have 4 businesses. One is IAPI, which is the industrial automation process industries, which basically exposed to all the large core industries in the cement, steel, pulp and paper, mining, et cetera. So -- and it had a direct correlation to what is happening in those sectors and the amount of spend on the CapEx and OpEx side, those customers are able to do it. And if you see these areas, these are subdued at this point of time. And some of them are showing the green shoots, and they will come back. And accordingly, the order as well as the revenue pickup in these segments will follow that trajectory. If you look into the second business, which is IAEN, it's energy business, basically, these with the oil and gas, chemicals and the power generation side of the business. I think the oil and gas side and the chemical side of the business, we have good successes. But if you look into the power generation segment in the market, especially the brownfield projects which were upgrading themselves, they are kind of depressed, and they are kind of into some kind of limbo at this point of time, if I choose the right word. And that also has a corresponding impact on the IAEN. But as we go forward, the quality of those projects and those customers will become clarified, the ones who are serious players, they will execute their contracts. And accordingly, it will pass-through our books. When it comes to IAMA, which is the measurement and analytics, I think we have a good traction there. I think that business is essentially products. It's not exposed as much to systems business or integrated systems unlike IAPI and IAEN, wherein we package automation solutions and the electricals together and also a lot of site work. Those -- that is a more product-oriented business, and there, the flow and the profitability flow and the revenue flow is quite reasonable at this stage, given how we are in the marketplace today. And when it comes to turbochargers, turbocharger, we are a hub unit for turbocharger here in India. We serve Bangladesh, Sri Lanka as well as India from here. I must say that the Bangladesh and Sri Lanka are doing quite well in terms of turbochargers, given the amount of activity and amount of consumption they have on the diesel-generating side and also on the marine side. In India, there's a reversal taking place in the Indian railways, wherein the Indian railways is moving away from diesel locomotives to electric locomotives. And those -- that has a kind of a reducing cycle for turbocharger business, where the exposure is to the Indian railways because that's a very firm and clear trend. But then whatever other opportunities in the market, turbochargers continue to expose itself. But while we have the reduction of turbocharger on one side, but then at the same time because of the electrification of the railways, we are picking up the business and the volumes on the traction side of the MO business, our Motion business. And that has been quite robust pickup for us. So maybe whatever we may lose as a volume on turbochargers, we have a reasonable and a good pickup on the Motion side on the turbo converters and also on the metro side of the portfolio. Now with respect to the profitability is concerned, it's directly proportional to the revenue pass-through into our books and the traction of revenues. And as we go forward, I think the backlog that we have, we foresee that gets executed, and that will be executed with the good discipline. But also, we would like to review some of the projects like, say, in power generation side, what kind of tracking we have in that area. And we continue to review those projects. And as and when we find some weakness, we will notify to you as well as to the markets. So I think that area is a bit of a tough spot because of heavy industry exposure. And as you know, generally, the heavy industry is not investing in particularly strongly at this particular point of time. But we have a long-term view to these businesses. So we will adjust our cost to the revenue projection that we have for following quarters. And accordingly, we continue to adjust as the demand comes back in these segments.

The next question is from the line of Renu Baid from IIFL.

I have 2 questions. First, if you can help us understand the continued momentum that you've seen on the Motion side. One part of the leg, you did explain in terms of higher growth coming in from the rail electrification portfolio. If you can also elaborate some of the other end growth drivers along with competition from the domestic players in the space? And second would be on the export side. How has that performed in terms of overall revenues for the quarter and YTD? And have we yet started to see some material traction in terms of export opportunities for industrial products? And third, if you can answer any tailwinds that you see coming in from Codian acquisitions for robotic in the F&B, pharma and related segments of the portfolio?

So Sridhar, if you can answer the export part first, then I will invite a comment on Motion from Sanjeev Arora and Subrata for Robotics.

So yes. So on the -- when it comes to the exports, Renu, the order inflows have been static, right? So there have been neither no increase nor decrease. That's what we've seen from the order inflows. So we are roughly the same as what we used to be earlier. Roughly, 12 percentage of the total orders are from the export orders, what we have, right? And it's the same last year as well. So I think we expected that exports could be a good contributor to fill the gap, which is there in the domestic market, which is not the case at this given point of time.

All right. So with respect to specifically about Motion, I think very quick comment from my side. I think it's a combination. What we enjoy today in the market is a combination of continuous investments through different cycles in last many years and expanding our portfolio on the very high energy efficiency motors as well as continue to boost our portfolio on the dry side and also continue to kind of localization efforts. And of course, a lot of connect, market connect that our team under the leadership of Sanjeev Arora is leading. So Sanjeev, would you like to give a reflection to Renu what is it causing a better performance on the Motion side?

Yes. So thanks -- sorry, Sanjeev and others, I got disconnected. So I just joined back the call. So I think, first of all, it is actually our -- of course, giving due credit to our teams. And our customer servicing approach, that has really -- the way we have supported our customers in COVID -- when the COVID was at its most, I would say, fearsome peak. So it's not over, but at the fearsome peak, how we supported during the lockdowns our customer, that has really created a very good, I would say, affection for...

Sanjeev, if I may interrupt, I think what we had is a drop of call for a few -- 1, 2 minutes, could you restart from where you kind of started speaking?

Okay. So am I audible?

Yes, you are. Just repeat from -- right from the beginning.

So thanks. So [Technical Difficulty].

Sir, I'm sorry to interrupt, but your audio is breaking up. We are unable to hear you well.

Sanjeev, your audio is breaking now. Okay, so we wait for Sanjeev to fix his audio connection. But in the meantime, we can go to Subrata about Robotics. What was -- what precisely was the question, Renu?

Sir, this was regarding the acquisition, which parent has done, Codian acquisition, which brings in the skill set for F&B, pharma and related portfolio.

Sure. So Subrata, why don't you give a very quick overview other than nonautomotive sector, what is happening, and how this acquisition also helps you as you go forward with your portfolio?

So first of all, thank you. It's a very good question from your side, Renu. Only thing is I say that is a huge change shift in technology is coming into the robotics and flexible automation side. We see that in India also, it's basically a little bit early stage, but a lot of responses are coming from warehouse and technology and -- as well as pharma, electronics industry. Although it's early stage of automation, but we did -- we're getting a huge response from this segment. And at the same time, the acquisition has happened. Now in the robotics which is coming from the very flexible and adding the most portfolio into it. So we are very hopeful about this. I cannot speak at this moment the complete technology acquisition filled. There are a lot of things going on in the back end. Otherwise, however, what I say that what are all happening, which is completely the view, keeping the vision on the electronics, where are these technologies, food, pharma industries. So the shift is completely -- it is getting shifted from the so-called legacy systems of automobile industry towards those new segments. So it's coming up, a very exciting technology shift is coming up in the coming future. We will see even early 2021 a lot of such kind of product and portfolio are adding into our products level.

Thank you, Subrata. So Renu, we do see good traction in this nonautomotive sector. That's why we are acquiring these additional technologies. And of course, when the acquisition is made, it takes some time to create that synergetic effect and inform the front lines what to sell and how to sell. But I think maybe next time when we take a call in January, February period, perhaps we can elaborate it more for you.

Sanjeev, are you back?

Yes. I'm back. I hope I am audible, and it doesn't, again, go back.

Okay. Go ahead, Sanjeev. This time, let's hope it works.

So when we talk of Motion, actually, so the customer connect of our teams, I give through full credit to our people there, how we supported our customers in the COVID times during the lockdowns when it was at the fearsome peak, I think that has really given a strong bonding with our customers. And then afterwards, how we ramped up our operations, our supply chain, how we converted their urgent and requirements into -- into the revenues and really supporting them to run their day-to-day operations in the industry, I think these sectors have really played a good part. And then by the time this was settling, then there came some momentum in the market also. Some pull was also there in the market, which was a lull period in, say, May -- April, May, but then situation improved month-on-month. So when we talk of the light industry, the pharma, food and beverages, HVAC, so things started moving upwards. Then we have also seen good orders from our traction business. We had good orders from our traction motors, traction converters. So that gave the top line growth, and the baseload orders continued to show a good improvement. Our channel business was -- came -- it was the last in the recovery. But then slowly, when that Tier 3, Tier 2 cities came to a bit of a momentum, our channel business also started improving. So overall, it has been, I would say, a good combination of the markets and the back-end support what we provided to our customers. And on top of it, I would also like to highlight that during this time, really the -- how we have supported on the remote connectivity, so be it remote commissioning, be it remote monitoring offers or be it remote installation. And also to add to that, the factory acceptance test, we were able to do remotely in all our motion products. So with this, the customer is not -- he's not supposed to travel to our factories. But then he gets the similar, I would say, experience, as if he is doing it face-to-face. So these all things have really built up a good base for Q3 as well as future for Motion.

Thank you, Sanjeev.

I hope I was able to answer, and sorry, and sorry for the audio.

Thank you, Sanjeev. So Renu, that's what. There are many factors that have to come together for a business to perform. And I think all the inherent technologies and the possibilities we had, our teams deployed it. And I think that is a combination of fact that caused it.

The next question is from the line of [ Sujit Jain ] from ASK investment.

Sanjeev, I have a question on, when our global CEO took charge, he did a con call with the analyst community. And there, he set out a target of 13% to 15% margins for the entire group, which I'm assuming and we are presuming that obviously will be applicable to us as well. When I look at our company and our peers, the typical margins even in the best time hover between 10% to 11% if I look at our long history. And plus, we have an additional handicap where our outgo to the parent in terms of the fixed support royalty and other fees, et cetera, was at around 6% in CY '18 and around 5% in CY '19. So that is higher than the other peers who are listed and are MNCs. So how do you see us reaching that 13% to 15% margin and which has been set by the global CEO. That is question one. And the second question is, again, on the margins in IA segment. You singled out the turbochargers. When is this legacy order/order is going to come to an end because this is the fourth quarter in a row we've had suboptimal margins? And a quick last question is on digitalization. When do you start reporting, giving us some idea as to what percentage of revenue digitalization, IoT is contributing?