Fairchem Organics Limited ($FAIRCHEMOR)

Ladies and gentlemen, good day, and welcome to the Q4 FY '26 Conference Call of Fairchem Organics Limited. [Operator Instructions] I now hand the conference over to Ms. Purvangi Jain from Valorem Advisors. Thank you, and over to you, ma'am.

Thank you. Good afternoon, everyone, and a warm welcome to you all. My name is Purvangi Jain from Valorem Advisors. We represent the Investor Relations of Fairchem Organics Limited. On behalf of the company, I would like to thank you all for participating in the company's earnings call for the fourth quarter and financial year ended 2026. Before we begin, a quick cautionary statement. Some of the statements made in today's con call may be forward-looking in nature. Such forward-looking statements are subject to risks and uncertainties, which could cause actual results to differ from those anticipated. Such statements are based on management's belief as well as assumptions made by and information currently available to the management. Audiences are cautioned not to place any undue reliance on these forward-looking statements in making any investment decisions. The purpose of today's earnings conference call is purely to educate and bring awareness about the company's fundamental business and financial quarter under review. I would now like to introduce you to the management team joining us on today's call. We have with us Mr. Nahoosh Jariwala, Managing Director and Chairman; and Mr. Bhavesh Shah, Chief Financial Officer. Without any delay, I would like to hand over the call to Mr. Bhavesh Shah to begin with the financial highlights.

Thank you, and over to you, sir. Thank you. Thanks, and good afternoon, everyone. Welcome to the earnings call for Q4 and 12 months ended FY '26. For the quarter under review, the revenue from the operation stood at INR 117 crores, reflecting a 3.2% year-on-year decline from the corresponding quarter. EBITDA for the quarter was INR 8 crores with EBITDA margin of 6.9%. The adjusted net profit after tax for the quarter stood at INR 3.7 crores. For the year ended FY '26, the revenue from operations stood at INR 460 crores, a decline of 14.5% against the previous year. The EBITDA was INR 22 crores with an EBITDA margin of INR 4.7 crores. The net profit after tax stood at INR 6.2 crores. The domestic sales contributed 91% of the total revenue. The total volumes sold was 44,000 tonnes against 54,000 tonnes in the previous year. During Q4, we have successfully completed the buyback of 4.25 lakh shares, which has increased the promoter holding from 6.2% to 63.2%. With this, I'll hand over the call to our CMD, Mr. Nahoosh Jariwala.

Thank you, Bhavesh. As we close the FY '26, I want to take a moment to share our operational perspective on the quarter and more importantly, the road ahead. The Q4 FY '26 continued to present a mixed environment. Our revenue from operations saw a decline of 3% on a year-to-year basis, driven largely by softer offtake from the paint industry, which, as you are aware, has been navigating its own structural adjustments over past several quarters. That said, I'm pleased to note that our EBITDA margins improved to 6.8% during the quarter. This improvement was primarily supported by better price realization in the domestic market as the pressure from lower-priced imports moderated to quite an extent. On the external environment, while we remain watchful of evolving macroeconomic situation, including the uncertainty arising from the ongoing Middle East crisis and its potential impact on global supply chains and commodity prices. We are, at the same time, consciously optimistic about trajectory ahead. The continued progress on the lower tariff framework with U.S., the prospect of free trade agreement with U.K. and EU and the recent depreciation of rupee together has created a meaningful tailwind for our export competitiveness. Despite the near-term uncertainty, we remain quite confident and committed to navigate this environment with discipline and resilience. We are confident that steps we are taking today will position us well for the future. With that, I open the floor for question-answer session.

[Operator Instructions] First question is from the line of Rakesh Jain, an individual investor.

So the paint segment has been the primary demand. . .

I'm sorry, Mr. Jain, can you please repeat your question? We are unable to hear you.

The paint segment faced some headwinds over the past few quarters. So do we see any recovery?

Yes, we have started -- seeing recovery during the month of March. And even during this quarter, we see a robust recovery happening.

My second question is regarding the company revenue. So we were targeting nearly INR 20,000 million. Any guidance regarding that?

That's a very, very long-term future. I mean that is something which is a vision, which we are working on. So it's after 5 years.

[Operator Instructions] We take our next question from the line of [ Danish Da ] from an individual investor.

So my first question is on the FDA with the EU and U.K., what specific product stands to benefit the most, for example, like the Isostearic Acid or Dimer acid or others? And what is the current duty differentials that makes this market attractive once the FDA is in place?

Both Isostearic Acid and Dimer will -- the duty, 10% duty will help both Isostearic and dimer. That is more important. And as regards the duty differential between other countries and India, we are on par with all the countries. So I mean, it's a healthy competition for us when we are quoting our price to U.S. buyers.

Okay, sir. Also, I have seen one more observation, like power and fuel cost has declined significantly in Q4 FY '26 to INR 60 million from INR 80 million in savings in FY '25. Is this a result of the energy audit initiative.

Yes, we did for one year. I mean, during the preceding year, we did the energy audit of the plant. And based on that, we -- looking at the payback, we invested in electrical equipment, pumps, motors. We reduced our -- we invested in heat exchangers, et cetera. And based on that, this achievement has been there. And we are -- it's still ongoing. We expect further reduction in the energy cost.

Next question is from the line of [ Dharmit ] from Sarla Family Office.

My first question is with regards to margin. Going forward, are we expected to go back to what was our FY '25 margin of around 8% if the situation normalizes? Or are we going to see a further margin expansion also considering the initiatives we have taken in the last year to improve the cost structure? And secondly, on the long-term revenue growth, we are saying that we are going to achieve 20,000 by FY '30. So can you tell us that where actually this expansion in revenue, which we are planning to see is coming from.

Margins are going to be better this year. I mean, obviously, we are targeting to breach 8% margins. We -- and we are fairly confident we'll be able to breach that. That is one thing. And as regards the revenue thing, currently, we are -- our plant is of 80,000 tonnes, and we are working at around 65%, 66% capacity utilization. We are confident in next 2 years, our plant would start working at more than 95% capacity utilization. And second thing is we'll be adding one new raw material, which is based on a new novel process, which we have been seeing. And so yes, based on that, this is the vision which we feel we might be able to reach.

At 95%, also the EBIT margin will remain around 8% or are we going to -- can it reach even further up considering that. . .

It can creep up.

Yes, operating leverage will pick up.

Okay. And this additional product, is this also in the paint industry or is more of a cosmetic product?

It's basically from the oleochemical basket only.

Next question is from the line of Chirag Vakharia from Budhrani Finance Limited.

Sir, wanted to get a sense of for financial year '236, in terms of turnover, sir, how much contribution is from Dimer acid, Linoleic acid and Isostearic acid, if you can throw some light?

Dimer acid has contributed -- just a minute. has contributed close to around INR 140 crores and Isostearic acid has contributed INR 26 crores.

Then 30% around 5% to 6%.

I did not hear it, sir. Dimer acid is. . .

Around 25%, 30% and 5%.

And Linoleic acid?

Linoleic acid is also around 30%.

Okay. In terms of volume, sir, I did not get. You are saying for FY '26, you did a volume of how much [4,000]. . .

Q4, we did 10,500 tonnes -- and for the whole year, we have done 44,000.

And this for FY '27, how do you see, sir, this panning out?

We expect to reach around 80% capacity utilization.

180,000 tonnes of the 80,000?

Of 80,000.

I am sorry, [ Keshav] , we are not able to hear you...

I hope my voice is audible.

Yes, please proceed.

Yes. Sir, so I wanted to ask you that our -- what used to be Adani Wilmar, sir, now they are forward integrating into oleo resins. So I understand since they are already into edible oil refinery. So whatever raw material we are probably buying from them. So for them, it is a forward integration. So sir, what kind of impact can it have on our business and our margins?

Adani Wilmar is already in oleochemicals since year 2010. They are already -- basically, they are on utilizing the palm-based products in their oleo. The products what we are using are all soft oil-based products and which are produced in a very small quantity to the tune of 1% of the crude oil. So it's -- I mean, the equipment and market and process, everything is different for both the products.

Understood, sir. And sir, also now recently, we are hearing a lot about Chinese anti-involution and that they are basically -- at least they are talking about stopping the aggressive dumping. So are we seeing any kind of relief on that count?

Yes, we have seen. We have already seen that since February end.

Okay. Sir, so then how much further improvement can we expect for FY '27? If you could give us some broad outline what kind of top line?

It's not possible for me to really -- see what we are saying is we will be -- we are targeting to work at 75%, 80% capacity utilization and our margins obviously will improve because there is no major dumping happening from Chinese.

And sir, now, sir, what kind of improvement in realization have we seen in recent times?

Fairly good.

Yes, because Chinese dumping is not happening. So our realization, we are able to sell at good rates.

So at least in percentage terms, if you could shed some light or like per kg, how much have our major products increased?

No, it won't be possible for me to share that.

Even percentage-wise, like 10%, 5%, something like broad directional this thing.

Yes, around 8% to 10% improvement has happened.

And sir, also rupee has fallen quite significantly.

Yes, that is also. . .

That has increased the import cost. If our export will improve, that will add to our bottom line.

It is helping us in our exports

Next question is from the line of Maitri Shah from Sapphire Capital.

A few questions on the exports. So you mentioned a lot of tailwinds that are happening on the export side. So any color on how the growth is going to be like so what is our current contribution from the export and how we're going to scale that up going forward?

Just a second. So our exports is close to around 9% -- I mean last year, it was around 8% to 9%. We expect this to go from 8% to 9% to around 20%.

There will be a major growth coming in on the export. How do you see the margins?

Yes, they will be similar to what margins we are making in domestic market.

So the margins are similar. The realizations are betrer. . .

Yes, yes.

And also the long-term target of INR 2,000 crores that you have, any new verticals we are entering in or are we expanding the. . .

I mean we'll be adding 40,000 tonnes to our 80,000 tonnes capacity of new product.

It's going to take long. It's basically 5 years.

Yes. But that kind of requires a 40%, 45% growth run rate. Are we like confident of doing that linearly over the next 4, 5 years?

Yes, we feel that. I mean we feel that we'll be able to.

Yes. The efforts were on since last 2, 3 years. In fact, last 2 years have been [indiscernible]. So you have to see it from the context of -- so these activities are all started from FY '23 onwards. Unfortunately, because of macro environment, we underperformed in the last 2 years. But yes, the efforts were going on since FY '22 levels.

So you have to think in the context of. . .

And the new -- you said the raw material that you're going to add with 40,000 metric tons. So that kind of raw material has a higher -- better margin, a better realization. What sort of products are we looking at?

No, it's a very -- it's a newer raw material. Obviously, part of oleochemical stream. We'll be following a novel process, and we'll be doing it for the first time in India.

Okay. And similar kind of customers are we targeting for that? So we will target the existing customers for the growth on that.

Yes, yes.

Next question is from the line of Chirag Vakharia from Budhrani Finance Limited.

Few update. What is the custom duty right now, sir? Is it the same as 16.5%?

Yes, it is 16.5% right now.

Okay. And sir, last time you highlighted that vegetable oil prices were up. So how are they behaving now as they go up.

No, no, they have remained stable. They have remained stable, what they were. So they have remained stable.

And sir, on the import duty on the Dimer acid, has that changed? Or is it same?

No, 7.5%.

Okay. And sir, the new product that we are suggesting should come in FY '27 or FY '28?

It should be around '27, '28, somewhere at that time. And then slowly, it will pick up.

Do you think the worst quarter for us is over now and we should bottom out now.

Yes, yes. For sure.

Next question is from the line of Sanjay Shah, an individual investor.

So my first question was about your margins. So for Q4 FY '26, the revenue declined 3.2% Y-o-Y, but EBITDA improved sharply to 6.84% from 3.64% in Q4 FY '25. So I wanted to ask, was this margin recovery driven more by lower raw material costs, reduced China import pressure or better product mix? And also, how sustainable is this improvement heading into the next quarter?

It is based on better price realization because of less dumping happening from China. That is one thing. And secondly, we -- I mean, we see the same thing continuing even during this year.

Okay. My second question was that the bypass fat product from PFAD and the new raw material for specialty chemicals, as both mentioned are your new product initiatives. So what is the current stage for these? Are they in lab trials or commercial, when should. . .

Bypass fat, we'll be putting in that plant in operation next month. And as regards the new product, by end of Q2, we should start the plant.

So sir, by when should investors expect revenue contribution from Q2 only?

No, it will take -- I mean, for bypass fat, it can start from Q3 onwards slowly. But for the new product, it will take minimum 2, 2.5 years because of validation and everything, which is a long process.

Okay, sir. Got it. And my last question was regarding your dividend. So for this year, you have recommended a dividend of INR 1 per share, which is down sharply from INR 7.5 per share last year. So is this reduction primarily a function of the temporary earnings drop or more of a conservative long-term dividend policy, especially in the context. . .

No, it's basically because of temporary earnings loss.

Next question is from the line of Keval Shah from Jeetay Investments.

Sir, my first question was regarding -- you mentioned that FY '26 capacity was around -- like the production was around 45,000 tonnes. And next year, we expect to do 75% to 80% utilization on a total capacity of 80,000 tonnes. Is that understanding right?

Yes.

Okay. So the top line basically now should go back to where we were in 2000 -- FY '24, FY '25 kind of a thing where. . .

Yes.

And sir, is this majorly because of Linoleic demand -- Linoleic acid demand coming back in the paint industry? Is it predominantly because of that?

No, no, no, it's basically less dumping happening from China. So we'll be able to sell more of material at a profitable price. That's the only thing.

Okay. So we were restraining from selling and utilizing our capacity because of extremely adverse pricing and now we are able to do that.

Yes, exactly, exactly.

Okay. Understood. And also on the top of this, you said that paint sector has also kind of recovered a bit. So that is the second. . .

Yes. Some now, I mean, we have a feeling that since last 2 months, paint sector has started looking up.

Okay. And while it's doing a bit better, do we also see also realizations are getting better and margins are -- don't seem. . .

Yes, a little bit better, a little bit better. So overall, we feel confident that we'll be able to breach 8% margin.

But sir, with more Chinese -- lesser Chinese dumping and better capacity utilization, shouldn't the margins actually go back to what we used to do like 12% to 15% range?

That is our dream. So obviously, we'll work hard to achieve that. I mean we -- unturn to reach those levels. We try our best.

Okay. Okay. And sir, how is our progress on Isostearic Acid? I know like it's. . .

Fairly good, fairly good. But what happened was because of the 50% duty thing, our U.S. marketing was on hold, which has now started again. And as this is going in cosmetics, the time line is very long. I mean, because they need to study lots of things. So approvals take -- once the sample goes and approval takes minimum 6, 8 months, a year and then the first commercial shipment happens. That also after first shipment, another 6, 8 months is taken. So it's a long role dream. It's -- I mean, that's absolutely fine with us because, I mean, it creates entry barriers for others in future. So I mean that's absolutely fine. As our product -- in product quality, we are comfortable. Maybe if not today, tomorrow, it will pick up.

Okay. So any early sign that we see because of tariffs coming off and the FDA. . .

Obviously, people have started asking for samples. Now they are. . .

So FY '27, '28 could be years where we could see meaningful ramp-up for Isostearic as well?

Yes, yes.

And that would be -- that is very high-margin product, as you had mentioned. So that remains the same. So that would be an additional lever for our margin improvement.

Yes, yes.

Next question is from the line of Sanjana Kamath, an individual investor.

I had a few questions. So the U.S. level playing field tariffs, which are cited as a positive for the exports. So have you already commenced or have you started receiving inquiries for restarting the U.S. exports, specifically on the Dimer acid side?

We have started exports, in fact, commercial exports has started since 2 months, though, on a small scale but we have started.

Okay. So what would be the realistic time line for, let's say, meaningful export volumes to resume back?

Around 6 months max.

Okay. And also, you had set a target for exports to reach almost 50% of the sales eventually. So currently, the exports, they still appear to be very small part of the revenue. Can you share. . .

When we said 50%, it was based on the current -- I mean, products getting exported from current 80,000 tonnes capacity and 40,000 of new upcoming capacity. So based on that, we had recommended. So major is going to come from the new 40,000 tonnes capacity.

Okay. Got that. So what would be like the current export percentage? And what would they look like in like, let's say, 12 to 14 months, what would the export road map look like?

Currently, it's around 8% to 10%. We expect to reach anything above 20%.

Okay. And if possible, could you share like you mentioned that the rupee depreciation as a tailwind for our export competitiveness, right? So like how much does 1% move in your rupee impact your export realization? Do we have any data on it? Could you share?

No, no, no. Because, I mean, it's not only one way because if the rupee depreciates, our raw material also go up a little bit. Our energy cost also would -- in form of coal also would go up a little bit. But the export realization is much higher than these 2 things. So we feel it's -- I mean, devaluation helps us. No, we don't have exactly any figures.

Next question is from the line of Chetan R. Chheda, an individual investor.

Sir, can you tell us in FY '26, what was the concentration in terms of the industry where we supplied our products like paints being the highest and what are the next highest industry and so on, at least top 2, 3?

See, basically, our product goes in making of -- both the products go in making of inks, paints, polyamides, which are part of epoxy hardener and drilling fluids. So I mean, everything is fairly equal ratio for all the market is there. So I mean that's not been any major concentration on a particular market or anything. Basically, our capacity utilization is going to be better because we are now finding it -- the selling of material is viable. Formally, it was because of Chinese competition, it was not viable. So we were not -- we were deliberately producing less and selling less.

Okay. And in terms of exports, so what industries we would be exporting to in terms of applications?

Same industry. Yes, epoxy hardeners and drilling fluids.

Okay. And in terms of the nutraceutical or the [ gluco serums] where are we currently. What was our contribution from. . .

Right now, we are not doing much on that business. That plant is -- I mean, not being utilized right now because the vitamin market is very -- I mean, it's not doing that great. So I mean we are not doing this business currently. So once demand is up, we'll start the plant again.

Next question is from the line of Amit from Robo Capital.

Sir, my first question is on the 40,000 new capacity. So my understanding is that the revenue from that will come after 2 years, right?

They'll start coming after 2 years.

Yes, correct. And what can be ballpark revenue? Any directional number on what can be revenue?

It's a high value. It's a fairly high-value product. So I mean, theoretically speaking, yes, INR 800,000 crores.

Right. And also, I think the margins will be better than our traditional. . .

Much better.

Yes, it should be closer to 15%, 18% type of margins, right?

Yes. I mean the margins look at this stage and when we did the project and we have done the calculation, the margins look fairly robust.

Right, sir. And I mean, there was some delay on this -- I mean, we have not been tracking the company for the last few quarters. I have just joined that after a few quarters. So there was some delay on this, right? And can you throw some light on the delay, like what was the. . .

No, no, no. Yes. Basically, if you really see our last 2 years have been bad years because of major changes happening in the raw material prices, whereby the duties went up from 5.5% to as high as 27.5% on our raw materials and dumping happening on our finished products from China. So combined effect was that. And so we were not going very aggressively on expansion by taking undue -- I mean, by taking debt. So now once things have stabilized, we have started doing it.

Right. So that the macro situation has now improved to your -- I mean, to your advantage now, has it become more neutral now?

Yes. Yes.

Right, sir. And it requires some product development, I think if my memory right. . .

That work has already been done. We have a lab unit, we have pilot plant unit and now we have the plant, which we will be commissioning in Q2.

Right. And after that, so we will then be in touch with customers to get the product approved, right? It probably has a longer cycle.

First step is to stabilize the plant. Second step is to validate our process. Third step is to get -- send out samples for approvals. So I mean that's the reason we are saying that it's going to be 2, 2.5 year cycle.

[Operator Instructions] The next question is from the line of Keshav Garg from Counter Cyclical PMS.

So sir, just wanted a confirmation. You mentioned 16.5% custom duty is on United States for export from India.

No, no, no. That was -- that is a raw material import. Vegetable oil imports have 16.5% duty in India.

Okay. Got it. And sir, you mentioned 8% operating margin is something that we can expect for this financial year?

Yes. This should continue.

Understood, sir. And sir, what has to happen for our margins to increase to the erstwhile levels of, let's say, 11% I'm not going to 16%, 17% that we did in 2022 to 2022. But what has to happen for our margins to at least go into double digits?

I mean if things continue like this, volume growth happening and devaluation happening on rupee side and our energy saving initiative working, we can grow at double digit.

Understood, sir. And sir, exports, you mentioned in FY '27 itself, we are expecting 20% of sales?

Yes, yes.

Next question is from the line of Dhiral Shah from Phillip Capital.

What was the volume that we did in FY25. For this year we did 45,000. . .

In FY25, we did 54000.

Yes, 54 for this year, 44 for. . .

Yes, this year [indiscernible]

Sir, as you mentioned, the Chinese company have started coming down or it has been almost negligible. What was the Chinese company used to be earlier?

Chinese?

Dumping, sir.

I mean, basically, they were selling at a lower price, Dimer.

Yes, exactly. So my point is that only. What was the import that was coming from China?

It's around -- coming around equal to what we were selling in domestic market. 800 to 1,000 tonnes per annum.

Okay, and this only for the 1% Dimer acid or other produce which we are dealing with and the China. . .

No, this is the only product.

You mentioned Dimer acid contributed INR 140 crores total revenue in FY26?

Yes, yes.

Okay. And sir, my second question, as you mentioned export contribution to rise to 20%. So which geography we are more focused here?

U.S., Europe, Japan.

Okay, given currently the U.S., Europe, Japan is contributing 8%, 10% and and going ahead, the 3 geographies will contribute to the higher revenue?

Yes.

Okay. And sir, this 40,000 new products that you are talking about that you are going to commission in Q2, what's the CapEx that we have incurred for that?

I mean, the first phase CapEx is around INR 20 crores or INR 25 crores what we have done.

So this will add to the 40,000 tonnes capacity or maybe much lesser?

No, no, no, no. It will be less, sorry. we'll add up as the demand grows.

So initially, we will start with lesser capacity, as you have mentioned.

Exactly.

So this will be how much, sir, then?

I mean it should be around 8,000 tonnes.

Okay. So maybe by -- within next 2 years, once we get our approval and customer side, we will be touching almost 40,000 tonne capacity?

Yes. I mean because, I mean, overnight, you cannot expect to penetrate the market. I mean there is no way you dismantle the competitors. So I mean, we expect that within 5 years, we'll be -- we'll be able to reach 40,000 utilization.

You're mentioning, sir, 5 years?

Yes.

Okay. So within maybe next 5 years, maybe 40,000 tonnes will even INR 800 crores to INR 1,000 crores revenue.

Yes, yes.

Okay. And sir, in the paint side, since we have a larger user industry, particularly paint and paint, there are also new players which have emerged. So are we also supplying to those players?

Yes. We are supplying to all including. . .

Even JSW, sir?

JSW is on water -- in water-based paints which is a different segment.

Okay. And sir, lastly, on the working capital side, if I look at last 2 years, our inventory days have gone up maybe substantially. So is there any chance of improving our working capital cycle going ahead?

No. Working capital is expected to remain at around between 100 to 120 days.

Okay. So inventory days would also remain at the higher level because it used to be around 50, 60 days, now it has gone to even 90, 95 days, sir?

Yes.

If the volume increases, it will -- I mean, since the denominator will improve, it will improve a bit from the current level of 120 days.

Next question is from the line of Chirag from Budhrani Finance Limited.

Sir, I wanted to understand on this, you said that the pressure from the Chinese import has come down. Sir, have you been able to figure out why has it happened so?

No. It's not possible. But overall, Chinese companies in all -- practically all the products have reduced. I mean, something has happened, whereby -- I mean, all the products what they were dumping is somehow going down.

So has there been any export restriction on their dumping being put there? Any idea, sir?

No, no, no. But quite a few products, whatever the export incentives Chinese government was giving has been removed, which was as high as 15% in lots of -- so I mean, obviously, it's because of that only the Chinese would have done. And they were selling at a price which was, I mean, too low for -- I mean, so they must be making losses.

Okay. And sir, when we supply most of -- we supply to all the paint, so we don't have restriction to supply the material to any paint company, right? We are not bound by that.

No, no, no.

Okay. And sir, the last thing is, sir, what is the CapEx for '27 and '28?

This year, there won't be any CapEx except for anything related to energy saving.

Okay. And that would be how much, sir?

No. I mean that is whenever the things come up some because we have just finished one energy audit. Second energy audit is happening. If the CapEx is less than 4 years, we'll go for it.

Okay. And sir, for '28, what would be the number?

I mean that everything depends on '28 for what happens to our new product. If that picks up, we'll go for investment. Otherwise not. Current business doesn't require any CapEx.

Right. So now we are just focused on improving the top line, right?

Yes, exactly.

Next question is from the line of Keshav Garg from Counter Cyclical PMS.

Sir, I'm trying to understand that when we did our peak revenue in, let's say, FY '23 of roughly INR 650 crores. So sir, that time, what was the sales volume that we did roughly?

54,000.

No, sir, 54,000 was for FY '25 or for FY '23 also, it was 54,000 only.

So which year you are asking?

Sir, I'm asking for FY '23 when we did peak revenue of. . .

54,000

54,000, '23.

Okay. So it was -- so basically, our volume was flat at around 54,000 for till FY '25 and only last year, it fell to 44,000.

Yes.

No. In between FY '24, it has gone up to 63,000 also.

Okay. INR 63,000. Okay. Sir, but it doesn't reflect in the revenue number. So I'm assuming the prices must have gone down. And that is why despite the revenue going up, the -- despite the volumes having gone up in FY '24, the revenue has actually come down year-on-year.

Yes, yes, yes.

Now sir, what I'm trying to understand is that since you mentioned that Chinese government must be giving them some incentive, that's why they were selling at the price which apparently looks as a loss-making prices. But now that the dumping has stopped and prices have gone up by 8%, 10%, sir, don't you think that now basically, even if that export incentive from 15%, we don't know if it has become 0 or maybe something like 5% or something in that vicinity. So the point is that can't that dumping restart because after all, they must be having capacity. So now where is that capacity going? I mean if. . .

Maybe the sense would have prevailed that it doesn't make any sense to lose money. I mean, that is all possibility. That is -- and I mean, Chinese government can reintroduce that 15% incentive. I mean that is not in our hand. But I mean, I don't think so. I mean, for 2 years, they played that game. I don't think they'll be able to do more. And that also during this current geopolitical situation.

Yes, sir, I'm absolutely with you on this matter. But my only point is that now that prices themselves have bounced back, so now even without additional Chinese government support, can't the Chinese exporters in light of the increased prices, can't they restart like dumping at the current price.

That's not a problem. That's not a problem for us because at this price, we are happy.

Understood, sir. And sir, now the thing is that whatever refinery byproduct we require, can't we import that byproduct from other geographies?

No. Historically, this -- because of the freight component, these byproducts, historically, nowhere in the world have been traded, exported. This is normally used wherever it's generated, it is consumed domestically only.

Sir, what is the pricing arrangement that we have with the refineries for their byproducts, which is our raw material cost?

It's I mean it's a buy-sell. Basically, it's driven by market. It's a commodity.

Okay. So is it like monthly revision or quarterly, yearly. . .

A daily revision. They don't enter in any long-term contracts. It's just like a commodity.

So now if, let's say, these seed oil prices come down, then the raw material prices will also come down.

Yes.

Okay. Understood, sir. And sir, what about the end product prices that we have with our customers, like, let's say, paint industry and so on? Is it a monthly . . .

It's a buy-sell again. Maximum, it's one month.

[Operator Instructions] Next question is from the line of Ketan R. Chheda, an individual investor.

Sir, correct me if I'm wrong. I heard that we also import some raw material. Is that correct?

No. We have an option, but we don't import, but right now, we are not importing.

Yes, against export, we can import. But we are not importing because, I mean, it's not viable compared to the material what we are getting domestically.

Right, right. So I think this was in conversation with one of the earlier participants where he was mentioning that the devaluation of rupee, we should actually be benefited because then we earn more in INR terms than we export. And I thought you said that, because we also import so that benefit is not there.

No, no, no. I didn't say import, I said raw material. My words were raw material, not imports.

But raw material we buy domestically only, right?

Yes, yes.

Okay. So still, if the INR is getting more devalued, we are not benefited so much. Is that understanding correct or no?

Obviously, we are getting not 100% to the extent of 100% of devaluation. Partially, we will be 100%. I mean, partially, we'll be getting benefited in our exports.

Yes. But in a way, our raw material will also increase since the crude. . .

I mean devaluation is -- I mean, in both ways. India imports vegetable oil. So the price of vegetable oil to that extent is -- to that extent, our byproduct -- our raw material cost would go up. So not for us, for any company.

Ladies and gentlemen, we will take this as the last question. I now hand the conference over to the management from Fairchem Organics Limited for closing comments.

Yes. Thank you very much for attending the conference. We'll meet in the next quarter.

Thank you.

Thank you very much. On behalf of Fairchem Organics Limited, that concludes this conference. Thank you all for joining us today, and you may now disconnect your lines.