Century Plyboards (India) Limited (532548) Earnings Call Transcript & Summary

Ladies and gentlemen, good day, and welcome to Century Plyboards (India) Limited earnings conference call hosted by Asian Market Securities Ltd. [Operator Instructions] Please note that this conference is being recorded. I now hand the conference over to Mr. Karan Bhatelia from Asian Market Securities. Thank you, and over to you, sir.

A very warm afternoon, ladies and gentlemen. We welcome you all to the Century Plyboards (India) Limited Q2 FY '21 Earnings Con Call, hosted by Asian Market Securities. From the management side, we have Mr. Sanjay Agarwal, Managing Director and CEO; Mr. Keshav Bhajanka, Executive Director; Ms. Nikita Bansal, Executive Director; and Mr. Arun Kumar Julasaria, CFO; and Mr. Abhishek Rathi, Deputy General Manager. I would request Mr. Sanjay Agarwal to take us through an overview of quarterly numbers, and then we can open the floor for the question-and-answer session. Over to you, sir.

[Audio Gap] the company. Mr. Keshav Bhajanka, Executive Director; Ms. Nikita Bansal, Executive Director; and Mr. Arun Julasaria, our CFO of the company, have joined together in welcoming you to the Second Quarter FY '21 Results Call of Century Plyboards (India) Limited. Our earlier estimates were to achieve back-normal or near-to-normal performance in the last quarter of FY '21, but the force and robustness of Indian economy has really pushed the performance of most industries to near normal in the month of September itself. I am happy to present to you that CenturyPly in quarter -- current quarter has achieved 88% of last year's Q2. I also want to highlight that September '19 and September '20 were almost equal in top line. Alone, plywood sale in the month of September '20 was higher by 6% than that in September '19. What I mean is that the plywood sale instead of being [Audio Gap] experienced September '19, okay? And this trend has done even better in October. I feel proud in informing that October month has been one of the best months in the history of CenturyPly. In Q2, year-on-year growth in MDF is over 20%. Our vision to take the MDF route for growth is proving right. For the first time, I'm happy to report a degrowth on positive note, as plywood has degrown lesser compared to other products in panel segment. You all know that we are already working hard to expand our MDF capacity. And once all the variables are finalized, we will be announcing the sale. Mr. Keshav Bhajanka had undertaken himself to put up the plant at its earliest. Year-on-year, our operating margins are better in Q2. And PAT is almost flat, even after achieving only 88% of the top line in the quarter. CenturyPly has always believed in bringing new technology for its customer. And this time, our production team, along with our R&D team under the guidance of our Director, Mr. Ajay Baldawa, and other renowned scientists, have brought ViroKill technology. This treatment is based on nanotechnology and is absolutely safe for humans and environment. Aggressive decisions in R&D and more aggressive decisions in popularizing it through media has resulted in better consumer preference of our products. We will constantly introduce other technologies and features in coming years to keep the consumer benefiting and the market budging. Our total debt were INR 189 crores in March '20, which increased to INR 243.5 crore in June '20. I am pleased to report that the same debt as on 30th of September has come down only to INR 85 crore, including both long-term and short-term debt. All our ratios, which were distorted due to COVID situation, are now at its best, even better than pre-COVID level. We have seen that Indian economy bounces back strongly after every such depression. We again expect our economy to perform very strongly for next 2 to 3 years, at least. Even the real estate sector is showing signs of recovery. We believe the whole story is about sustenance. If one can sustain and keeps kicking in the long, bad time, they will certainly do better when the good times come. I am also proud that CenturyPly holds the highest possible standards of corporate governance, which gives us the internal sustenance power to fight any war and win it. With these remarks, I hand over to CFO, Mr. Arun Julasaria, to take you through key financial figures, post which we are open for your queries. Thank you.

Thank you, sir. Good afternoon, ladies and gentlemen. First of all, I will like to mention customary disclaimer that this con call is just to discuss company's historical numbers and future outlook. In no way this should be construed as invitation to invest in the company. Results for the quarter, along with detailed analysis, is already mailed to you and also hosted on the stock exchange and company websites. Assuming that you have gone through that, I will not take much of your time and take you through only basic numbers and macros. The results for Q1 were adversely impacted due to COVID-19 pandemic and consequent nationwide lockdowns. However, as informed in Q1 call, we'd look Q2 with optimism. The recovery in Q2 was better, faster and swifter than what we expected. Blended revenue for Q2 is almost 88% of revenue corresponding Q2 in last year with improved levels of EBITDA and profitability. All business segments have done well, and MDF segment has done exceptionally well. Total revenue for the quarter was INR 519.8 crore against INR 589.3 crore last year. Overall EBITDA, without considering the exceptional items, was 16.8% against 16.4% in corresponding last quarter and 15.6% for the whole of FY '20. Profit after tax for Q2 is INR 51.4 crore against INR 52.1 crore in Q2 last year, so almost flattish. On balance sheet front, all working capital parameters are now normal, and working capital cycle is again pegged at normal level of 2.3 months. As informed by MD sir, we have considerably reduced our debt level. I'd like to add to that, that now our average cost of borrowing is near about 2% per annum. With these words, I open this conference call for questions and answers. Please go ahead.

[Operator Instructions] We have the first question from the line of Prashant Kutty from Sundaram Mutual Fund.

Congrats on a very good set of numbers. So firstly, in terms of plywood, heartening to hear these comments from you. Just wanted to understand, you said real estate is also kind of picking up as well. Would we look to increase our outlook for plywood business in the second half of the year? And also, you spoke about sustainability. Tell us how long can this actually sustain? Because you are, on one side, also seeing good growth in MDF as well. So just your thoughts on this part, sir. Hello? [Technical Difficulty]

Sir, sorry, we cannot hear you, sir.

Yes. Hello. Hello. Can you hear me now?

Yes. Sir, now we can hear you.

Yes. Sorry. Sorry, so I will restart. So I think there are 2 reasons basically for the plywood performance. One is the pent-up demand, which I think is proving true for most of the industries. The second one, which is much more important than this one, is actually long-lasting probably for us, the ViroKill technology and its media popularization. So because of this, CenturyPly brand has really got a boost, and we are finding that brand for CenturyPly is now much more than most other brands. You can compare the numbers with others yourself. Going ahead, I believe that this technology will -- and our media plan will bring CenturyPly and keep CenturyPly at the top of people's minds. And safety is important to everybody. So I believe that, going ahead, the numbers should be good. But yes, let the time pass and let the actual performance prove it for us. As far as I'm -- you asked something for MDF also?

Yes. I asked them earlier. So before I come to plywood part, just this ViroKill, obviously, that has come up, I mean, I believe it's a premium product itself. So is -- are there any targets over here in terms of the next 1 or 2 years? What kind of scale you kind of want to achieve in this particular segment?

Very, very frankly, I am little cautious at the juncture. Yes, we have very big plans, and we have very good numbers in our mind. But then I will not like to promise at this juncture for -- but yes, going ahead, we know that, yes, the situation is going to change, and our numbers are going to do better. That much only I can tell at this moment as far as our plywood is concerned.

Yes. Sure. Just 2 more questions from my end. Firstly is on the laminates business. What really went wrong? And how is that trending up in the month of October, if you could just speak on that part? And secondly is on the MDF business. You said that you're almost in process of finalizing the MDF capacity addition. I wanted to ask the current capacity can go out and how long, is one part which I wanted to ask. That is one part. And secondly -- yes. And secondly, is this on MDF UP or is it the existing plant? What is the plan sort of [indiscernible]?

You see, as far as MDF is concerned, MDF is the first thing, I think, what has happened, the Government of India is now working very hard. And it has actually created some problems to import of furniture in the country. So that is why the readymade furniture market in India from Indian producers is really booming. So the demand of MDF and particle board has improved. So similarly, we increased prices in particle board. I don't think we have informed that or we have informed it, I don't remember. But yes, we have increased prices of particle board, and we probably will be increasing prices of MDF also. We are watching the market, and we'll be increasing prices of MDF also. The demand has improved because the readymade furniture market is improving. And it's now going to improve for long term because the government of India has identified furniture as the segment where they want India to become the powerhouse of the world. So India -- government thinks that India can become a major exporter of readymade furniture. So that's part of the MDF business and its future. But your second question, regarding the location of the unit and all, I will request Keshav to take that question, actually.

So you see, there are 2 parts when it comes to the question. When it comes to location, of course, the realization is very important. I think, the transportation cost, considering the fact that MDF is a very low-weight product or very high weight relative to transportation cost products, we are exploring between 2 locations. Sitapur, as you know, has its own set of limitations. But we have also identified a location in the South, which we are actively pursuing. By December, we should have a clear-cut decision as to where we'll be proceeding with the plant. With regards to laminates, laminates, as a product category, always follows plywood in terms of demand. There's a lag because first, plywood will be used. And then on top of that, laminate or any other decorative sources is normally used. So October was a good month, and our recovery has been strong. I think month after month, we have grown, and I think October is a very good benchmark to show. And going forward, this quarter, we should be performing substantially better in laminates category as well.

Okay. Sure. And just one bit, the -- any change in the CapEx because of the -- if the location changes to South?

If we go for a plant in the South, then more likely, we'll go for only an MDF capacity. If we go for only an MDF capacity without the fungible particle board aspect, the CapEx will reduce. I think we'll be looking at a CapEx of close to INR 350 crores, if we look at the line in the South.

Next question is from the line of Sneha Talreja from Edelweiss.

Congratulations on a good set of numbers. Just a couple of questions from my end. Firstly, on -- your average cost of capital has come down significantly. So I would like to know what's your foreign debt at this point of time? And what's the average cost of debt for your working capital as well as term loan?

Yes. Right now, our borrowing is only in 2 forms. For working capital, we have borrowed packing credit, which after taking subvention is around at 2% per annum. And we have also borrowed ECB, which is less than 2%. So we have got only 2 fund-based borrowing. Both are either at 2% or less than 2% per annum.

So the average cost of debt that we have seen on the interest rate -- the interest cost that we have seen, you think it's sustainable for the year like a kind of...

Of course, of course, we are not going to borrow any more at higher rate.

Okay. Okay. And the second question was regarding your laminates division, so just a few more clarity. One thing you said is it comes with a lag. You said definitely, you've seen enough pickup happening from October. So can we get a growth number for October or the degrowth for October month, sir, only your laminates business? And what was your Q2 mix of exports as well as domestic for laminates?

In Q2, our exports domestic ratio was pretty much consistent with what we have been doing before. And as far as the October figure is concerned, we had close to 10% growth over October last year.

So you've already started seeing growth even in your laminates division.

Yes. Yes, we have.

And just from my understanding, I won't have the previous figures. So did you see exports to be a growth number in Q2? Or was it the domestic which impacted the growth more in the laminates division?

The domestic impacted more. The domestic degrowth was higher. The export was more or less -- the degrowth in export was substantially lower.

Okay. So both were degrowth, but exports' degrowth was lower than that.

Yes. Yes.

Okay. And sir, looking at the run rate, the last time -- this is just last question from my end. Just looking at the run rate of what we've been achieving. So last quarter, you gave the guidance that you would be kind of looking at 100% of sales across your divisions by around Q4. But given that we have already started seeing growth, let's say, in the month of September as well as October, is there any revised point of view that you would like to give?

We would love to do it. And I think, yes, we are reaching there. But people are talking about the second wave or a third wave of this corona, so you never know. But we still stick that, yes, the fourth quarter, absolutely, will be there or maybe better than last year, and we are keeping our finger crossed for the third quarter.

Next question is from the line of Madhav Marda from Fidelity Investments.

My question was on the MDF, the industry as a whole. Just any updated thoughts that you'll have on the demand-supply dynamics for MDF? And especially on the supply side, how do you think the competition on the supply side evolves? Because it's a fairly nascent industry. But if we become an export powerhouse for readymade furniture, this industry could be multi x to what it is today. So just how do you think this evolves in the years to come?

Our Chairman has spoken many times that today, probably in India, we make about 8 million cubic meter. About 1 million cubic meter is installed capacity in India right now, which we expect in next 5 years to go to maybe about 4 million to 5 million cubic meter. And with the policy of the government focusing on furniture as one of the items which India will export, India will replace China in the world. And we are already seeing the results because the furniture import has been made costly. And so more and more furniture -- Indian-made furniture is being sold in India. So yes, furniture is the product for future. And our expansion, yes, we are, I think, as I spoke about it, and we will be there.

Understood. Now sir, I understand the growth aspect. I was asking that like if any new player wants to come because of the industry goes from 1 million to 5 million, that's 5x in 5 years, one would expect that more players would like to enter or they would like to become a larger company. So how do you think the competition evolved? What's the barrier to entry? That's just something I'm trying to understand for the MDF because it looks very promising.

There are many states which do not allow, number one, the entry. Number two, because you see, we are into this industry, we know the industry so well. So for anybody else, there have been people who have tried earlier. And I think, if I'm not wrong, none of them have succeeded till date, actually. So I don't think that -- yes, they are welcome to come, and they are welcome to compete. There's no problem. Nobody will stop them. But the question is only, number one, the investment. The investment is so high because the investment and the turnover are typically 1:1 or 1.1:1.2. So that is one issue there. And the second issue is the credit in the market. So you have to understand the market first and how can you extend the credit in the market. So I don't think that many new players or outsiders will come. But yes, there are people in the timber industry, plywood industry, laminate industry, they are getting in and new capacities will come. See, we need to wait and watch. All these things in every industry has happened, and we will see the game happening in front of us.

Okay. Just one last follow-up. The new people who tried to enter but did not succeed, any reason, like what are the challenges that they faced in trying to scale in the business?

[Foreign Language] There's no point in getting into the history. [Foreign Language].

Yes, sir. But [Foreign Language].

Yes. I know. I know. One should know the history. We all know, but I don't think this is -- this time is there right now to get into the history. We have to speak to our business right now.

The next question is from the line of Nehal Shah from ICICI Securities.

Congratulations, sir, for a very, very good set of numbers. And more importantly, on the balance sheet, I think you've done a remarkable job. Sir, a key question on plywood. Now while our growth has been pretty much very, very strong, like decline has been much less than what we projected for, and that's largely to do with pent-up demand, you also said ViroKill technology obviously had led to a strong boost in sales. But frankly, sir, what kind of benefit ViroKill or even Theory of Constraints or even sales force automation, all 3 put together, what has been the impact on our plywood efficiencies and plywood volumes? If you can just quantify or give us a color as to what is happening in each of these 3 tests which you have taken, which is absolutely different to what the industry has done over the years?

So I would like to take this question. So with respect to ViroKill, so in the past, plywood is a type of a commodity where bringing in new technology or bringing a new customer benefit is very difficult. So the last time we were actually able to do something was when we came up with the borer- and termite-proof plywood, and that's how Century became Century. But since then, this was the first time we came up with the innovation where customer is right now very scared because of the virus in the air, et cetera, everything. Customer is scared. So we try to solve a customer problem. So because of that, there is definitely a very, very big impact on our sales. We are even seeing, compared to all competition, big, small, we are doing much, much better. Whether it be Q2, whether it be October, we've done far better than them. And I think that is solely due to ViroKill. And definitely, see, any change within the company takes time. So the sales force automation that we've done, we actually started this in June. But now, honestly, since the last 1 month, people have really started moving around and traveling. It's now when we are actually seeing the effects of sales force automation coming. I think the full effect of this will take probably in 2 more quarters. I think by the year-end, we are expecting the effect to be far more visible. But right now, the effect is small. It's there, but not 100% due to sales force automation. And what was your third change that you were talking about?

The Theory of Constraints.

Yes. So Theory of Constraints, honestly, if we did not implement Theory of Constraints, we would have not been able to supply the material we've been able to do with the type of demand we've had in October, September and August. We would have not been able to do because there was -- you're very much aware that there was a huge worker problem. Labor was not returning. And -- but because we had stock maintained not only at branch level, we had stocked maintained at factory level, we were able to -- even this month, we will be able to supply the demand that we are facing despite festivals and all the closures in between of various dates because of Theory of Constraints. So Theory of Constraints has helped us maintain our supply throughout the year.

And how many branches have we put on this Theory of Constraints so far?

The entire India. So entire India, plywood, laminates is on Theory of Constraints.

The next question is from the line of Sonaal Kohli from Bowhead.

Congratulations on fabulous cash flows and numbers. Sir, I have 3 questions for you. How has -- you said that your demand both in September and October has improved, and October has been the best month. From where are you getting the growth? Is it from the top 6, 7, 8 cities? Or is it a higher growth from the smaller cities? Once you answer this, I'll ask you my next 2 questions.

Okay. So the thing is the growth has come from across India. The growth now -- as we've seen where the cases are coming down, the growth is coming from cities as well, as well as some up countries. So I would not be able to say that it is specifically from the top 6 cities. It is across India. We are seeing sort of a pent-up demand, which was there. And suddenly, everyone is wanting to renovate just before Diwali or before a second boom comes. Before that, they want to renovate and shift. So we are seeing that type of a demand coming. So it's across India.

Secondly, you, in fact, have answered that question. How can you say that this is largely pent-up demand? Or there is something structural which is happening, which gives you confidence not from a next quarter's perspective, but from a next 1-year perspective? Because pent-up demand should be more or less over in this quarter or at best in the March quarter, if it's led by a pent-up demand. So is there anything which you are tracking? Or can one say with confidence what it is? Or it's too early for me to ask you this question? What are the management thoughts about it? Secondly, as far as your MDF plant is concerned, I'm sorry if you have said this already. Where are you planning to put it? From what I recall, you had earlier plans for Uttar Pradesh, and Punjab was a backup plan. But I heard something about putting up capacity in South India. So I just wanted to clarify.

So the MDF question, Keshav will take up. Just I'll answer the first part of your question. So currently, we are seeing that -- the reason why we are saying it's a pent-up demand is because there has definitely been a sudden increase in September, October. But like I said, we are definitely -- because we are providing an innovative product of ViroKill as well as we are on air through -- from August, September, October, and we plan to be on air through the year, we are definitely getting more sales than our competition. So I am not -- we want to be cautious when we say that whether this type of demand will continue on or not because we don't know how this virus will behave. Most countries are getting a second wave. So in case that happens, right now for us to project the rest of the year becomes very difficult. But we are definitely looking at this as a positive -- with a very positive outlook because had it just been due to pent-up demand, we would have done similar numbers. But we are doing more. So definitely, this growth is there to last for us, but we are keeping our fingers crossed.

So just to add on to that point, you see, the gap between us and competition is increasing month-on-month. So from July, that may have been similar. August for us was better. September for us was further better. And in October, we increased the distance further. So that gives us some confidence that even going forward, we are going to be doing better than most in the industry. Regarding your second question, for MDF, you see, the dynamics in the MDF market, the reason for setting it up in Uttar Pradesh was cheap timber availability and the fact that transportation costs to other parts in the country other than North would have been cheaper. Now the South has a decent raw material price. The price of timber in the South is more or less similar or slightly higher than in the state of Uttar Pradesh, and the transportation dynamic can be further reduced. Alongside this, antidumping duty has been levied, which is a safeguard of costs. I think going forward, we are actively and aggressively pursuing South, especially considering the license issue that has taken place in Uttar Pradesh.

Sir, just a follow-up. Since you are looking at South, there are a lot of capacities in South and some big, large capacities. Bids should be coming up from another listed player. That seems to be in distress considering the market cap and high amount of debt. Aren't those kind of capacities available? And couldn't you shorten your curve by buying out those kind of capacities? And if a large amount of capacities are already available in surplus in South, what gives you confidence that while we did an extraordinary job in North India and took market share from established players, the excess capacity in South is way more than what perhaps what was in North and further new capacities are coming up. So in that light, I'm sure the management must have done its own calculations of these. But some perspective would really be helpful.

You answered your own question with regards to North. When we came in, it was the exact same scenario. What people said was, there are 2 established players, and they have substantial capacity. You being a new entrant, you're going to have to sell at a discount. You will not be able to sell material. But just setting up a capacity and utilizing that capacity in MDF are 2 completely different subjects. Time has proven this, and it has been repeated again and again. So the operational efficiency that we bring to the table is far in excess of anybody else in the industry that's come in, and that is going to aid us in the South as well. When you're talking about large capacities coming in, there's one capacity that is coming in, just one. And as you have already mentioned, it is a listed player. And we're all aware of which company it is. But having said that, there aren't other capacities that are in the market. Definitely, by acquiring the capacity, you can shorten your time horizon. But the capacity should be available as well. I don't think that capacity is going to be available under any stretch of the imagination. So we are looking aggressively at the South. And I think the way we have performed in the North, perhaps we'll be able to reach full capacity utilization faster in the South. The industry is growing by 20% plus. So that is going to be a big advantage going forward.

And sir, lastly, with this virus technology, have you hiked your prices? Is it getting you better premium in plywood industry?

So Century Plywood has consciously taken the decision that we will not increase the price of our product by a single rupee. We are bearing the cost of the ViroKill technology. The ViroKill technology has been used in all our product categories that are manufactured in-house in plywood and in laminates. And despite additional cost element, you'll see our margins are better. Considering operational leverage, our margins are actually far better. So we are getting economies of scale. Raw material costs have come down. And through ViroKill, you will see our sales growing, definitely leading to higher margin going forward.

Next question is from the line of Achal Lohade from JM Financial.

Yes. Congratulations for the great numbers. Just to extend the question on the ViroKill. Is it possible for you to share the mix for the September quarter or October month from ViroKill brand?

Well, there is no ViroKill brand. So ViroKill is a technology that has been used on CenturyPly products, Century Club Prime, Century, Sainik 710, all these products that are manufactured in-house with -- sorry, with Century PS, so on and so forth, have ViroKill technology. So it is not a separate product category. Every single sheet of Century, 1 mm laminates and 0.8 laminates, has ViroKill technology. So there's actually no separate product range.

Right. Possible to give a mix, like what kind of mix is already we are seeing in the month of October from this one?

Are you talking about Sainik versus Century? Or are you talking about...

Sorry, I'm not able to hear you, Nikita, actually. Can you be a little louder, please?

Is it okay now?

Yes. Much better now. Yes.

Yes. So are you talking about Sainik versus Century? Or -- because we are not being able to understand your question really clearly.

So this ViroKill product mix, is that like an entire range of products? Because in the month of October, it's 100%.

Yes. Yes. So ViroKill is a technology that we have brought in all our products. So it's not a separate brand that we've come up with. It's a technology that we are putting in all our products that is manufactured in Century.

Got it. Got it. Just an extension of the MDF question earlier. What is driving this, the alternative to South? Is it to do with the delays in approvals for the greenfield plant in UP? Or is it -- it's more to do with the cost and the market situation where you see more demand from South?

It is actually a combination of both. You see, South was always going to be a high-growth area for us because we are today predominantly present in the North. Transportation cost does not allow us to sell a lot in the South, but the realization in the South also is slightly lower than the North. But the demand in the South is traditionally very strong, and it is growing at a rapid pace. So the license delay in Uttar Pradesh has definitely played a role. Uttar Pradesh was our first choice. Now looking at alternatives, South has turned out to be a very good, profitable, viable alternative. So I think going forward, the decision of the South unit will be taken on 2 or 3 fronts. One is the freight cost, the projected sales mix and on the overall convenience -- the overall ease of setting up the plant. The South looks like a good bet.

Understood. You mentioned about the antidumping duties. Can you elaborate a bit? I believe the government was considering the antidumping duty. But has it been finalized? Has it been announced, in your opinion?

In principle, the government has taken it under consideration. I think it is only a matter of time.

And this is more on the thin MDF, where the price difference is large, if I understand it correctly?

Yes.

Understood. Understood. And can you talk a little bit about the cost savings measures? Like I see the other expenses and the employee costs are down on a Y-o-Y basis. So can you elaborate a little bit as to how much of this is sustainable? And I'm sure this has also helped in terms of the margins at the segmental level.

See, we have not cut salary, even a single rupee. We had cut salary in Q2, but we reversed that entire decision due to performance. We said if the company performs at 80% plus, then we'll be reinstating salary at exactly what it was before. So I don't think that there is any cost element where you will see an increase going forward because you've already factored that in. All the savings that we have achieved are a result of a lot of introspection, a lot of hard work during the course of the lockdown. And I think they're paying dividends now.

Okay. Just to clarify, I see that the employee cost is down 14% Y-o-Y. Let's say, in absolute terms, it's about INR 75 crores, INR 76 crores. Is that the run rate we would kind of look at for next few quarters? Or there is the adjustment, as you said, about reversal, something...

For the remainder of the year, the reversal has already taken place. It has already been accounted for in the numbers. So going forward, for the rest of the year, you will see a similar run rate.

Understood. Understood. And with respect to plywood, can you help us understand what is the mix of premium and Sainik?

So for competition reasons, we don't want to give out economy segment numbers. However, by volume, they are in the range of 35% to 40%. And value, it is in the range of 25% to 30%. I don't want to repeat that number.

Okay. Okay. 35% to 40% of -- for volume and 25-odd percent of revenue. Is that right?

Yes.

And the mix has remained similar? Or has that changed? Like are you seeing a growth in a non-premium more than the premium?

See, definitely, if you know about the plywood market, we -- it's more of a V shaped -- like a belly in the middle. So we are right now trying to grow in the belly segment through Sainik. So definitely, the growth will always be higher in Sainik segment. But because the volume that you have to play in or gain market share is in the Century segment, it's always going to be lower because we are already 30% of the branded plus [ 100 ] segment. So I think going forward also, the growth definitely in Sainik is going to be higher. But that does not mean that we are not growing as much as the market is growing in my Century segment.

Understood. Understood. Just if you could comment on the segment margins. I mean, I see that the margins are pretty good. You commented about the revenue part. But just on the margins front, how do we look at the margins for the next 2 quarters or remainder of the year?

So you see, whatever margins we are seeing right now, they are the route to operating leverage. As you know, we've had degrowth last quarter. So as we improve our performance between Q3 and Q4, I would assume that margins would be on the up.

And just last question, if I may, with respect to utilization for month of October, if you could talk about like laminate and MDF?

Our utilizations were better than in Q2 right across. Our utilizations are better than October last year as well.

Would you be able to give out the number? Like I would imagine MDF will be already at 100%. Plywood is...