Advanced Enzyme Technologies Limited (ADVENZYMES) Earnings Call Transcript & Summary

Ladies and gentlemen, good day, and welcome to Advanced Enzyme Technologies Limited Q2 and H1 FY '22 Earnings Conference Call. [Operator Instructions] Please note that this conference is being recorded. I now hand the conference over to Mr. Ronak Saraf, Manager, Investor Relations. Thank you, and over to you, Mr. Saraf.

Good evening, everyone, and welcome to Advanced Enzyme Second Quarter and First Half '22 Earnings Conference Call. I hope you all are doing well. Joining us on the call today are Mr. Mukund Kabra, full-time Director; and Mr. Beni Prasad Rauka, Group CFO. For a reference, we have prepared a detailed presentation to supplement our comments during this conference call. This presentation is posted in the Investor Relations section of our Advanced Enzyme website and on the stock exchange as well. Before we proceed, I would request you all to please read the forward-looking statements disclaimer contained in the PPT. During our call, we will make forward-looking statements regarding our expectations or predictions about the future. Because these statements are based on our current assumptions and factors that involve risk and uncertainty, our actual performance and results may differ materially from our forward-looking statements. Now Mr. Kabra will start the opening remarks by briefing you all the earnings update and business highlights for the quarter. And then Mr. Rauka will walk you through the financials in detail. Before that, we will open the floor for question and answer around. So without any further ado, we shall commence this call. Over to you, Mr. Kabra.

Thank you, Ronak. Good evening, everyone. Once again, I welcome you all along with the whole AETL family to this conference call for the quarter and half year ended 30 September 2021. First and foremost, we hope that you and your families are in good health and in high spirits. Before we begin, I would take this opportunity to wish each one of you a very happy Diwali and a prosperous New Year in advance, make sure we all are successful and, most importantly, a healthy year ahead. I will start this call by sharing with you the earnings updates and the business highlights for the second quarter 2022 and segment-wise performance. Our revenue grew by 6% on a year-on-year basis to INR 1,271 million. Our EBITDA declined by 15% (sic) [ 16% ] to INR 493 million during the quarter. Our PAT declined by 22% (sic) [ 21% ] to INR 303 million. EBITDA margin stood at 39%, while PAT margin stood at 24% during this quarter. In the -- if we look half yearly, the highlights are like this. Our revenue grew by 14% on year-on-year basis to INR 2,641 million during first half. Our EBITDA grew by 2% to INR 1,120 million. Our PAT declined by 5% and stood at INR 700 million. EBITDA margin stood at 42%, while PAT margin stood at 27% during the period -- during this period. This impact in the operating margin is because of high input costs. We are finding unprecedented increase in almost all the input materials, including fuel and logistic costs, given that the growth journey we are into will contribute to invest and grow in our some of our physical aspects like R&D and business development. Our new R&D facility work is on track and even good progress. We believe this investment will help us to take very strong foundation for the future growth. Now I will take you through the segment-wise revenue. The human nutrition contributed 72%. Animal nutrition contributed 11%. Industrial bioprocessing contributed 9% and specialized manufacturing, which is a revenue from SciTech, has contributed 8% in the total revenue during this quarter. The human nutrition segment grew by 4% to INR 920 million in quarter 2 financial year '22 as compared to $885 million in quarter 2 financial year '21. The animal nutrition segment grew by 3% to INR 136 million in quarter 2 financial year '22 as against INR 132 million in quarter 2 financial year '21. The Bio-Processing segment underperformed by 37% during this quarter. It accounted with INR 118 million in quarter 2 financial year '22 as compared to INR 187 million in quarter 2 financial year '21. In this segment, food business contributed 7% and stood at INR 86 million, down 33% year-on-year basis, while the Non-Food business contributed 2% and stood at INR 32 million, down 48% year-on-year basis during quarter 2 financial year '22. The specialized manufacturing contributed to INR 97 million to our revenue. On the geographical revenue front, the domestic sales contributed about 47% of the revenue from operations during quarter 2 financial year '22 as compared to 42% during quarter 2 financial year '21. Domestic sales accounted for INR 594 million in quarter 2 financial year '22 as compared to INR 504 million in quarter 2 financial year '21, increase of almost 18%. International sales were 53% of revenue from operations as compared to 58% during quarter 2 financial year '21. International sales amounted to INR 676 million in quarter 2 financial year '22 as compared to INR 700 million in quarter 2 financial year '21, a slight decline of 3%. The revenue de-grew by 2% in Americas, while it has grown by 4% in Europe and strong 18% in Asia, ex India. The rest of the world remained muted during this quarter. Now let me hand over this call to Mr. Rauka, our CFO, who will walk you through the quarterly financial release. Over to you, Rauka, sir. Thank you.

Thank you very much, Mukund. Good evening, everyone. I hope you and I are in good health. Now I will take you through the company's financials for the second quarter of FY '22, and then the first half of FY '22. So on year-on-year basis, Q2 of FY '21 and Q2 of FY '22, our revenues increased by INR 67 million, which is about 6% from INR 1,204 million to INR 1,207 million (sic) [ INR 1,271 million ]. This includes sales of self by SciTech, which is roughly about INR 97 million in this Q2. Last year's Q2, there is lower number because SciTech, we have acquired somewhere in January '21. Our EBITDA has decreased by about INR 92 million from INR 585 million. Our EBITDA is at INR 493 million during this quarter at 39% of our revenue. Profit before taxes decreased by about INR 107 million from INR 520 million to INR 413 million. That [ stands ] at INR 303 million as compared to INR 386 million in Q2 of FY '21. So there is a decrease of 22%. Q-on-Q basis, sequential basis, the revenue is down by about INR 100 million, which is about INR 1,271 million as compared to INR 1,370 million. EBITDA is at INR 493 million as compared to INR 627 million. Profit before tax has decreased by about INR 134 million from INR 547 million to INR 413 million, stands about 32% during this first -- second quarter as compared to 40% of first quarter. That is at about INR 303 million, 24% of our revenue as compared to INR 397 million, 29% of the revenue during previous quarter. Our year-on-year basis, first half as compared to the previous year first half, year-on-year, revenue has increased by 14% by INR 332 million. So the 14% growth includes roughly 10% growth because of the contribution of SciTech. So we are at INR 2,641 million as compared to INR 2,309 million. EBITDA is about -- increased by about INR 18 million from INR 1,102 million to INR 1,120 million at 42% as compared to 48% last year. And the profit before tax has decreased by INR 67 million from INR 1,017 million to INR 960 million. So we are at about 36% of our revenue in terms of the profit before tax. NPAT is about 27%, which is about INR 700 million during the first half of FY '22 as compared to INR 734 million during last year's first half. Our [ Evoxx ] numbers are at INR 53 million of revenue and EBITDA of INR 10 million. And PAT is slightly negative because of tax impact. And that impact because we do some withholdings in India. This is kind of expensive for them. And the previous year, Q2 numbers were INR 50 million of revenue, INR 18 million of EBITDA and PAT of about INR 5 million. JC Biotech, Q2 is -- the revenue stands at INR 150 million and EBITDA of INR 45 million, that is INR 25 million as compared to revenue of INR 130 million, EBITDA of INR 37 million and PAT of INR 21 million. Our largest selling product, this is -- I mean, anti-inflammatory enzymes stood at about INR 268 million as compared to INR 272 million in previous quarter. So there's a slight degrowth of 1%. And it constituted about 21% of our revenue as compared to 18% in previous quarter and as compared to 23% in Q2 of FY '21. Our top 10 customers contributed roughly 31% of our revenue during this quarter as compared to 34% in the previous quarter, and Q2 of FY '21, it was about 39%. B2C segment, mainly from USA has contributed about USD 1.62 million as compared to $1.11 million during the previous quarter. India -- I mean, generally, we also sell the breakup of the human nutrition, which comprises of pharma, probiotics, biocatalysts. So India business was INR 403 million, roughly 32% for this quarter. International business stood at about INR 516 million, which is about 41% of our total revenue. So total was 72% of our total business for this particular quarter, Q2. U.S. sale is about INR 461 million, roughly 36%. So 50% comes from the U.S. Then other than U.S., other countries have contributed about 4% for human nutrition. And B2C, as already mentioned, overall, I mean, it's about INR 120 million during this quarter, roughly 9% of our total revenue. This is all from my side. Now we would like to open this floor for question-and-answer session. Thank you very much.

[Operator Instructions] The first question is from the line of [ Rohit Sinha ] from Sunidhi Securities.

So just on the overall outlook side from the second half, how we are looking at the second half of FY '22? And what sort of top line growth and EBITDA number, I mean, EBITDA margin basically we will be targeting on?

[ Rohit ], there is a lot of disturbance on the supply side. There are like certain disturbances on the logistics sites, and there are like certain price increment into most of the raw material, which is unprecedented. I feel like this should continue. And at the same time, there are like certain issues like the inventory pile up at many places. And I feel like this should continue until the March somewhere. February, March, the things should normalize. Going forward, we have also piled up some inventory at this point of time to cater to this -- all sort of these questions, which are going to come up. And we will move with the near base operations, which is required to maintain the sales. At this point of time, it's very difficult, but I would like to say that we will maintain the margins, which was in the range between 40% to 48% as we move on for the whole year. And on the revenue side, it's difficult, but I feel at least like on the -- I won't be able to give you the exact percentage increase, but we will be positive. At least like this was the worst quarter, what we are seeing. We hope that going forward, the next quarter will improve.

Okay, sir. Okay. And secondly, what sort of overall CapEx we would be expecting for FY '22?

For FX, for this quarter, the FX -- I mean, like for the whole year, the CapEx should be the normal CapEx, which is going to be somewhere around INR 10 crores to INR 12 crores on a yearly basis.

Okay. Okay. And just any update on the -- on our upcoming R&D plan, which we are talking about?

Yes. So it's not going to -- we already got [ area ] permission. Now the designs are getting finalized. And we are in the process of getting the sanction from [indiscernible] corporations. Probably 1.5 months to 2 months, we are a way to start the construction work.

Okay. Okay. And then by what time we'll be expecting to complete this?

Once we start, it will take 1.5 years, roughly. If we'll go in the phases, [ Rohit ], but the first phase should be finished within the 1.5 years.

[Operator Instructions] The next question is from the line of Shikha Mehta from Equitree Capital.

You mentioned that there has been -- the input cost has been high this quarter. So if you could give more color on that as to what increases we've seen in which line items broadly.

So it's like across most of the raw materials. The important thing is like the coal, the fuel, which is like one from which is like 6 -- 5.5 to 6 to somewhere around [ 11.5 ] years. And currently, it's about INR 15. So if you go through like all the [ phosphorate side ] or any of the results, everything is on the higher side. You go through the -- flow is now like going down, but the main impact is because of the logistics as well. So across the sector, you will find that there is an increase in the cost.

And do we this normalizing over the next quarter? Or do you think it will take till the end of the year?

It's very difficult to predict, Shikha, but my best guess is, like it should be normalized by the end of this year. And that is where like we are going with the inventory pile at this point of time, and we are going yield-based operations, and we will utilize more from our inventory.

Right. Sir, any guidance on the new products in the pipeline, anything interesting on that front?

So on the biocatalyst side, we have done a good progress in this quarter. We have come out with 3 more molecules and their applications, but it has to go to the customer level. And currently, like right now, we are standing with like 6, 7 molecules in the biocatalyst front, which is a good progress. Probably, it will take another 2 quarters or 3 quarters to really generate the revenues.

Sorry, you said 2 or 3 quarters, right, to generate revenue?

Yes.

Okay. So just the R&D cost in this quarter and for the half year?

Yes, INR 63 million during this quarter. And last quarter, it was INR 43 million. So for YTD, we have spent about INR 96 million. I'm talking about only the revenue side. And CapEx will be another year or some INR 20 million or so.

Right. And also, if you could give you a subsidiary numbers, again, I missed that one when you were giving them earlier.

Which one do you want, Shikha?

All the subsidiary numbers, the revenue and the EBITDA number for [ JC ] as well.

Okay. So if you don't mind, I can share you with -- share all these numbers, you can send me on email. I'll share with you all the numbers of the subsidiaries that you need.

Okay. Sure, sir.

[Operator Instructions] The next question is from the line Rohit Nagraj from Emkay Global.

Sir, the first question is we had introduced the probiotics for COVID fatigue in Indian market. So how has been the response till now? And what do you expect in terms of how the marketing and further penetration of this that we are planning?

This COVID fatigue product was just introduced in Indian market because we wanted to test the floor of B2C in India. However, right now, the sales are very low, but we got a good response in the U.S. market, where our sales are better with this product. And if you really look at it, the B2C segment of our U.S. has gone up to 1.6 -- USD 1.064 million for this quarter.

Right. So any particular marketing strategy for the Indian market that we are planning for? Because I think our characteristics would be certainly different than the U.S. market. So any plans on that front?

So in Indian market, like we are testing the floor. At this point of time, we have like -- we have launched the product on the Amazon. And also, we have already launched our website. And we are going to do some PR activities like Internet promotions right now. And we will see how the response is because this is the first product which we are doing as a test marketing. And once we understand the market, then will probably we'll come up with a few more products, which are in the pipeline, which are already there in the U.S. markets.

Got it, sir. Sir, the second question is on the industrial bioengineering. So particularly catering to nonfood area. What would be our strategy in this regard? Because given that there has been a lot of emphasis nowadays to go in for a bio product instead of the conventional chemical products, I think this could be a good opportunity from our perspective. So how are we probably going ahead with this particular idea in terms of our strategy and not talking about short term, but maybe from a 3- to 5-year perspective.

Rohit, which area you're talking, which industry you're talking?

Industrial bioengineering, which is a nonfood area related to, say, textiles or detergents or any other industries.

So Rohit, at present in textile and detergent nonfood areas is not our core focus area. We are really not like focusing on to those areas, but we are focusing into the food area where like the clean label or where the numbers are there. So how do we come out, and how do we give the solutions, which is, a, [indiscernible], chemical free. So we are coming out with the products in the food areas, but not in the nonfood areas.

Right. Got it. Sir, just one clarification. You mentioned that we are currently preparing for inventory. So these, I suppose the product inventories you are talking about. And for raw material, we are going ahead with more less like just-in-time concept, right?

We are going with both areas. We already work with the concentrate, which can take care of 2 to 3 months easily. We are working with -- we have kept a lot of raw materials as well. Coal storage as well, which can take care of any emergency orders. We can move quickly and can produce it. So we are not sure on the logistics because in between, we'll face the problem like we're almost out of the coal. And we had to shift to the furnace oil for some part of the day. So we don't want to get into that kind of a mode where the cost is very high. So we are keeping all the inventories at this point of time.

Right. Got it. And on cost, input cost pressure transferring to the products. So how much lag it broadly takes? And when do we expect that the entire input cost pressure will be transferred? Or is it just a transitory phenomena that by the time we try to take price increases, the raw material or input cost pressure, again, correct. And so we'll have to forgo whatever margins we have in the intervening period.

Yes. That's what has happened in this quarter. Cost has gone up, but you're not able to really pass on because of the kind of margin we have. So generally, that margin is always taking care of that kind of a fluctuation in input cost. So it's not possible to pass on it so fast, unless until the change is permanent. This appears to the kind of situation in this quarter we have tested. Now we have to, again, as we are progressing, we will again give you the -- whether we need to really look at in increasing of our prices or it's the kind of temporary transition you can sit on. [indiscernible] time there, you don't pass on that cost to your partners basically. And you observe it and then going forward, as things normalize, you start getting your same kind of the margins.

[Operator Instructions] The next question is from the line of Alisha Mahawla from Envision Capital.

Sir, firstly, I just like to understand the tepid growth that we've seen in the revenue, is this because demand has contracted or we were unable to supply because of logistics issues or because of unavailability of input material, maybe if you can show some color on that.

So there is no one reason to pinpoint. Frankly speaking, that's what has Mukund explained, that entire -- this is very exceptional time, frankly speaking. So very, very difficult. The input cost is going up. Logistics is another issue. And the cost of logistics has also gone up. And another thing is because of the severity of the pandemic, about 6, 7 months back, maybe in the first quarter, a lot of inventory has been built up by most of the customers. So I mean, the difficult time where like everybody is going very cautious approach that wherever the cost is increased, that one should really work on that particular material or not or work on something which is really giving kind of a margin just to stabilize at this overall profitability scenario and to manage the business. So during this time, I mean it is very difficult to give you one reason. But yes, this is -- I mean, overall, in terms of all several reasons like higher input cost, issues of COVID still in Europe, Russia, Americas. And I think U.K. is telling with another issue where truckers are not available to really transport their material because of some kind of issues with the Brexit. And the shipments are not available. And the transit time is, in spite of the good street to the destination, but they are not able to clear, so it is taking 3 to 4 months to get a shipment and clear from the port. So I mean the industry is really kind of a situation from what everyone is struggling in that sense. So we are not in a position to give you one single reason for that.

Okay. And sir, if you could share, have you lost any customers or any orders because of pandemic? Or it's simply a question of like you were mentioning COVID-related issues?

Yes. Yes, correct. So everyone is going with a very cautious approach. So procurement may not be there. They might have a kind of a situation where therefore, the procurement, okay, we have so much of inventory. Like we have built up our inventory. If I look at my inventory level as of 30 September, it is about INR 1,153 million, so roughly INR 115 crores as compared to INR 94 crores at 31 March '21. So this is the scenario overall.

Okay. So we've not lost any customer?

Not really. Different point. It's part and parcel of the business. One customer comes and goes, but not really...

One may not buy in a month, particular quarter or 2 quarters, but then the procurement happens after 5 months or 6 months. So it is not the loss of customer in that sense.

Got you. And sir, this is my last question. What are the kind of margins that we're making in our SciTech business, a new division that are now reporting revenue for? And would it be lower than what the overall business is doing?

SciTech as compared to our enzyme business, basically, we intend to -- the SciTech business is -- I'm sorry, I think there is some echo. It's a definitely different business. And this is with the intention that we have a different and novel delivery mechanism of our finished goods. So that's where like SciTech has been acquired. So SciTech's gross margins and price margins are definitely lower than us. And if I really give you the numbers in terms of overall EBITDA margin, SciTech is roughly at 25% of EBITDA margin and PAT margin of about 11%. And you are aware about our EBITDA margin of about 40% to 46%, and PAT margin of 25% to 32%. So if -- in spite of the fact that whatever sales we have from SciTech during this first, second quarter as well as year-to-date 6 months, overall, in the profitability, in absolute number, they have contributed. But in terms of percentage, definitely, it has a negative impact in that sense.

Okay. That could actually be one of the reasons why our margins are below the 32% margin band that we used to talk about.

And to some extent, yes, because, overall, for 9 months, if you really look at the numbers for 9 months, and then you have to see the difference of the PAT we have and the PAT of SciTech. And that's how you can work it out.

Okay. And just one last question, if I may squeeze in. Any inorganic opportunities that we're evaluating currently?

Yes. Definitely, that is part and parcel of, I think, our -- one of our strategy to grow and to sustain this particular business.

The next question is from the line of Manish Poddar from Nippon India.

Just 2 questions. First one is if you could probably share what would have been the growth rate in the probiotics and the biocatalyst segment in the first half of this year?

Growth in probiotic side?

Biocatalyst.

Biocatalyst, yes. [indiscernible], Manish?

Yes, sir.

So probiotic, international and domestic. total probiotics sales is about -- one moment, I'll just give you the numbers. It's about 185 during the first half of this year.

And this is versus?

It's 348.

[indiscernible] basis.

348.

I'm so sorry, you witnessed a decline up there? Is that what you were trying to say?

Yes. Yes, that's what I say, yes. Right.

So why would that be? Because I thought probiotics grew significantly in FY '21, and we were at....

Right. It grew significantly.

It's a -- we think like it's more to do with the inventory stockpile in this particular area.

Okay. And how about biocatalyst?

So biocatalyst is more or less same. Rauka, you can give a number because 1 or 2 products which were going -- those were going. But the good part is currently like we are signing with now 5, 6 products, and those products are going into the customers for the clients. So we feel that the revenue from the new product should come after 2, 3 quarters down the line.

So biocatalyst is doubled. Last year, for 6 months, it was INR 51 million, and this half, it is about INR 112 million.

Okay. So effectively, if I have to understand it in the first half of this year, the lower growth which you've seen in the human nutrition is largely led by the inventory issuing probiotics?

Right.

That is the one to look at, right? Okay. And just another data point, if you could share, is that what would your contribution, let's say, from the top customer and top 10 customers for first half '21 -- '22, sorry?

So Rauka...

Yes [indiscernible].

It's 31%, I guess, but you can do that number.

31% is for the top 10 customers.

Yes.

And the top customer?

Yes. 31% is top 10 customers and top customer is about, it's roughly 6%.

So we hear also, so the top customer, you still witnessed a [ decel ] in the first half? And could you probably explain the reason for that?

It's the same, Manish, what I talked about inventory issues.

Okay. And so do you see, let's say, the situation is probably stabilizing now incrementally? Or...

I don't feel like the situation should stabilize in the market. It should stabilize from the first quarter of next year.

Okay. Okay. And just one last one from my side. On the animal side, I think we were looking for partnerships up there. So probably, could you help us with an update up there?

So not on the animal side. We were looking into the partnerships on the food side in the Indian market as well as like in the South Asian market. We have appointed, [ as a lease ], as a distributor for 5 countries in South Asian countries for the food and Nutraceutical business. In the Indian food market, we have [ Jinan ] with the Anshul for the distribution. In the animal trade, we were going on our own. At this point of time, we started our Singapore office. Not exactly the office, it's work from home office that we started the recruitment in Singapore. And we started some recruitment in India as well to develop the market in Eastern Europe. And we are working on the Latin American development at this point of time.

So just to understand this better. So you will do the registration by yourself and also scale the business organically and not through partners. Is that what you're trying to refer to?

We are working on both the strategies. We are looking for organic growth as well as the inorganic growth. So if the opportunity comes from the inorganic front, we will definitely look into it.

[Operator Instructions] Your next question is from the line of Bhavesh Jain from ITI Org.

How important is the U.S. market for us? Because last 3, 4 years, the growth rate is not there in that particular market, even H1, we have seen 4% growth. And we have, I guess, in 5 years to double the revenue, right? How important that market will do for us to achieve that target or aspiration of doubling the revenue in 5 years?

Bhavesh, a lot of disturbance on your phone.

Yes. But our U.S...

Hello...

Yes, this is fine. I mean we have understood your question. Mukund will be answering your question, please.

Yes. U.S. is going to be an important market. No question about it. It's our important market, and our presence is very strong in the U.S. market. We expect 8% to 10% growth, which is coming from U.S. over a 5-year play.

Okay. And this segment largely will drive this growth because I'm saying last 3, 4 years and even this H1, it is not getting translated into higher growth.

So the growth which will be -- which will come -- most of the growth will come from the B2C segment, which we are really focusing and targeting. As like -- if we're really seeing with the B2C areas, last year also, we've gone from INR 3 million to INR 5 million. Currently, also, if you look into this quarter, it's already INR 1.61 million. This year, probably, we should touch about INR 6.5 million into this area. So this is going to be our growth target as we move on into the U.S. besides the normal growth in the B2B Nutraceutical business.

Okay. And India growth rate has been good in this H1 also. So ex of this tieback also, the growth rate has been good, and we are seeing that traction?

No. No, no.

No. If we just take out the side, it isn't probably like a -- this is like about more turbulent quarter, yes. The growth is almost at the same level at this point of time because of some of the inventory issues from some of the larger customers as well at this point of time. So the thing should normalize by the first quarter of the next year.

[Operator Instructions] The next question is from the line of Rohit Nagraj from Emkay Global.

Sir, during this quarter, we must have faced issues on exports because orders must have been on a CIF basis, would that be the right way of looking at it? And are we now looking to correct it by giving it on FOB basis? Or how are we trying to tackle this issue?

Rohit, our major export from India is, number one, to our own U.S. subsidiary company, okay? So whether you make it CIF, FOB, finally, it will have impact on the consolidated numbers, right? Other than U.S., other customers, wherever possible, we are negotiating, as far as you know, the cost of the shipments are concerned. But still, the cost has gone up substantially. So it is very difficult. We really also need to share. So it is an approach where we want to have some kind of a continued relationship with our customers, not exactly looking at the entire cost we can pass on to our customers.

Right. Got it. And sir, last quarter, we had provided guidance, and I think you mentioned in the earlier remarks as well. On gross margin side, 70% to 75%; EBITDA margin front, about 40% to 48%. So is this applicable for FY '22 as well? Or we are looking that FY '22 would be a transitory year because of the issues that we've been discussing till now?

Yes. I think this is transitory. And that's the reason now we are also going with cautious approach, wait and watch. And I think that's how the scenario is.

The next question is from the line of Bhavesh Jain from ITI Org.

Sir, one follow-up on our top product, we were seeing incremental competition and some pricing pressure. So how has been the competition in that product?

So yes, the pricing pressure is there that will currently pass on the cost, right? At this point of time, it is a top-selling product. But if we really look into the volume, we have sold more than what we did last year.

Okay. Okay. And tax has been good, right, as of now, in terms of volume?

Yes, yes. So volume-wise, it's better. Margin-wise, it is a little lower side at this point of time because we couldn't like really pass on the prices.

But has the prices stabilize? Or we still see more pressure on the prices?

It's more or less stabilized, but currently, there can be some pressure. But in this kind of a scenario, I don't see the prices should go down further. But it's more or less -- I guess, like it's stabilized at this point of time.

[Operator Instructions] As there are no further questions, I will now hand the conference over to Mukund Kabra for closing comments.

Thank you, everyone, for all of your participation and listening to us. I wish all of you a very happy and a prosperous -- happy Diwali and a prosperous New Year. Thank you once again. Thank you.

Thank you very much. On behalf of Advanced Enzyme Technologies Limited, that concludes this conference. Thank you for joining us. You may now disconnect your lines. Thank you.

Thank you.

Thank you.