Hester Biosciences Limited (HESTERBIO.NS) Earnings Call Transcript & Summary

Good day, and welcome to Hester Biosciences Q2 and H1 FY '20 Earnings Conference Call hosted by ICICI Securities. [Operator Instructions] Please note that this conference is being recorded. I now hand the conference over to Mitesh Shah from ICICI Securities. Thank you, and over to you, sir.

Thanks, Kunal. Good afternoon, everyone, and welcome to Hester Q2 results con call. We have the senior management, Mr. Rajiv Gandhi, CEO and Managing Director; Mrs. Priya Gandhi, Executive Director; and then Mr. Nikhil Jhanwar, Chief Financial Officer participating in the call today. I thank the management into ICICI Securities the opportunity to host this call. Over to you, sir.

Good afternoon, everybody. This is Rajiv Gandhi here from Hester. As always, it's nice reconnecting with you like the way we do every quarter. So today, we have declared the Q2 and H1 results. And the press note has also been circulated, and I presume that you have the details available with you as far as the press note is concerned. From my side to give you a little brief on the functioning of the company in the last quarter as well as the first half year of this financial year. So far, the year gone by in terms of first, talking about quarter-to-quarter. In Q2, we have had a marginal growth in terms of quarter-to-quarter business, while in terms of profit, we have done relatively better. The growth is 16% in profit as against 6% in the revenues. I would like to just share one thing with you that this growth of revenues, as mentioned also in our press note, the 6% growth we have divided it into the 3, which is poultry health care, animal health care and other operating income which include license fees and services. As the license fees and services in the Q2 in FY '21, we had and we did not have any in this quarter. So if you minus that, then our poultry health care has grown actually by 20% in this quarter and the animal health division has grown 8%. Talking about half yearly results. Overall, our half yearly results, we have grown on a half year same period comparison, we have grown by 24%. And similarly, if we look at the poultry health care and the animal health care, we have grown 34% and 22% respectively. Overall, the sales has been good. And we further also have the sales bifurcation in terms of vaccines and health products. In terms of vaccines, our sale has grown 13% on a quarter-to-quarter comparison, while our health products have grown 31% on a quarter-to-quarter comparison. In terms of half yearly, vaccines grew at 26%, while health products grew at 53%. Looking into the composition of sales as well as our objectives as reasonably well defined over the last period of 1 year to 2 years, where in every press note as well as in our talks as well as in our annual report, we have been saying that we would want to focus on the health products because the health products today, we are relatively at a smaller level. And as already informed to you in the past, any animal health company, their vaccine business is always less than their health products business, while in our case, is the reverse. So in a way, the potential to grow the health products is much, much higher and that is being addressed by us at the moment and trying to take the health products business as much as what we can do. In terms of domestic sales as well as export sales. The domestic sales on a quarter-to-quarter grew at 21%, on a half yearly comparison it grew at 38%. On the export side, we have been facing a little bit of a challenge at this point of time mainly because the international issues have still not fully resolved. And we have been selling mainly in the African continent as well as in the Middle East, where the flight movements are less, the economies over there are also still coming up with all these -- trying to recover from the current COVID situation as well as their other internal economic situation et cetera. So keeping all these things in mind, though our exports have not been as per what we have actually planned or forecasted, we are still confident that in this year, by the end of the year we would be able to recover because there have been many investments made as far as Africa is concerned. Distribution network is currently being put in place, people have been hired, marginal sales have been done, not that it has not been done. So overall, we feel that this -- that the export business will grow up more so our Hester Africa plant would soon be functional, which I'll come later on. So all that infra creation -- infrastructure creation would not only help for the local Hester Africa sales, but it would also actually in a way, lead to higher sales as far as exports from here are concerned. Besides the routine business as what we have been doing in the animal health industry, the poultry health division, the animal health division, you all are also aware that Hester Biosciences has tied up with Bharat Biotech under a licensing agreement to do the manufacturing of the drug substance for Bharat Biotech at our Hester plant. The greenfield project is currently under construction. We are constructing state-of-the-art BSL-3 facility, and we have reasons to believe that this should turn out to be probably the best BSL-3 facility that our country has out of all the labs that are there at this time. And we hope to take and produce the drug substance from Covaxin to be supplied to Bharat Biotech. Looking at the -- sorry, let me -- the capacity for the manufacturing of the drug substance for Bharat Biotech, we would be producing approximately 7 million doses equivalent of drug substance to be supplied to Bharat Biotech on a month-to-month basis. Coming back to our core business of animal health, animal vaccine. Hester has been working towards developing the classical Swine Fever Vaccine, Lumpy Skin Disease Vaccine and the Sheep Pox Vaccine. These vaccines are under trial. We have completed the technology transfer process from the government of India. Out of the 3 Lumpy Skin and Sheep Pox, Hester is the only company that has, at the moment, acquired the technology. So we have -- in India, so we have reasons to believe that we would be getting the 100% market share for these vaccine. Lumpy Skin Disease is already an emerging disease in India. And at the moment, we have a vaccine which is called the Goat Pox Vaccine, which uses the same strain as Lumpy Skin Disease. So we are in a position to give the Goat Pox Vaccine for the usage of Lumpy Skin Disease in cattle, and that is serving the purpose at this point of time. But hopefully, by the first quarter of the next financial year, all these 3 vaccines would be registered and we would be able to sell all the 3 vaccines. On the health products side, we have -- as you are aware, we introduced the herbal product range some time ago. This business is growing and we are very optimistic on the growth of this business as far as natural products is concerned. Looking at our need and looking at -- for the vaccine demand, which is increasing day by day overall in India, we have embarked on 2 expansion programs. One is to manufacture additional bulk antigen and another facility for the fill/finish facility. Both these expansion plans complement each other because the antigen would be manufactured in one facility and the final fill/finish would be done in the other facility. Both these facilities once they are completed, it would more or less double our capacity what it is at this point of time. The antigen production should be -- plant should be ready by the fourth quarter of this financial year and the fill/finish should be ready by the third quarter of the next financial year. With this we would have a huge immense capacity not only for the Indian market, but also partly for the international market. Last but not the least, we have been working towards introducing a pet care -- pet health care division. Today, we are producing products for the production animals, all animals that are used by human beings towards deriving an income, whether it could be eggs, meat, wool et cetera. Now we also intend to get into the pet health care division, which would make us complete -- have the full product range for all animal health activities that are possible across. So that's it as far as Hester India is concerned. In terms of our subsidiaries, Texas Lifesciences continues to support Hester India by supplying us the health products. We buy from Texas Lifesciences and then we sell it in Hester. There it has shown a steady growth as far as the sales is concerned. Yes, in terms of profitability, there seems to be a little bit of -- and we have a marginal increase in the profitability, not much, but it is in line with our objective towards ensuring that this is like a satellite unit of Hester, and that Hester gets the product and Hester does the marketing and sales from all products manufactured at Texas Lifesciences. Hester Nepal, which went through a very bad time in the last financial year due to COVID, where there was no scope of any vaccine movement from Nepal to anywhere in the world. As you are aware, we have set up the Hester Nepal plant to cater mainly for the PPR vaccine to be supplied under FAO tenders. Things seem to be reviving. Q2 has been much more encouraging. In fact, the sale of Q2 has been more -- much more than the financial year '21 sales in itself, thereby giving us an indication that things are now growing, and then we will now take it further. Hester Tanzania is our trading and marketing activity. Things are slow at the moment in Tanzania, but I think with our plant coming up and with those even sales contributing, which also all would be routed through Hester Tanzania. We believe that there will be a good pickup on Hester Tanzania. And at the same time, goods also, we are looking at increasing the product range wherein we will export from here to Hester Tanzania. All this is happening, but the current economies in Africa are a little slow right now recovering from various issues, one of them being COVID. But hopefully, this all should kick up and everything should be back in order. Last but not the least, Hester Africa, our star project in Africa, wherein we are going to be manufacturing animal vaccines mainly for the African continent. I'm very happy to inform all of you that we have taken the first 3 batches -- commercial batches over there, which are under test at the moment, and we should get the release of all these batches sometime in the month of November, wherein we are looking at inaugurating the plant over there. Once that plant is inaugurated, we will start the sales also from Hester Africa. Because of this 1 year delay that we have had at Hester Africa, we are, at the moment, working towards making sure that the pipeline over there is hastened up and that we start introducing more products in our pipeline. By December, we have targeted to introduce 3 other vaccines at Hester Africa besides the current PPR vaccine for which we have already taken the 3 batches. So this is an overview of all the activities that have been happening at Hester and it's subsidiaries. That's all from my side. Over to you all.

[Operator Instructions] We have the first question from the line of Manish Gupta from Solidarity Investment Managers.

Mr. Gandhi, there's so much happening in the company. So many products that we are seeing, new geographies that we are entering, we are expanding distribution in India at the same time, so many exciting things are happening. Can you give us a sense of what this will translate into in terms of some broad numbers 3 to 5 years down the line?

Giving you broad indications in terms of -- one is that I agree there is a lot happening and a lot is happening in different areas, increasing the capacity, push on the distribution network -- and network -- and trying to increase the sales notwithstanding the Covaxin project, et cetera. I do agree with you, and it's all are reasonably we are excited and at the same time, working day and night towards making sure that all these things are achieved. In terms of quantification, et cetera. In nowhere in our forecast, et cetera, we are giving any figures as far as Hester Africa sales are concerned, because we would want to leave it that to Hester Africa, as we established, it's the first time anybody would be producing a few types of vaccines over there and selling them. Yes, but of course, we have our forecast and everything in place in Hester Africa at 100% capacity utilization, we should be able to do $25 million to $30 million, which translates into around INR 250 crores as far as Hester Africa is concerned, which should take approximately 4 years' time for us to work towards getting up to that level, 4 to 5 years' time. Talking about Hester India, we have projected that we would want to touch INR 500 crores in the next 3 to 4 years' time. So that is what our indication as far as Hester India is concerned and Hester Africa is concerned.

And can you also provide some color on additions. We've -- in the press note, you talked about additions made to the senior management team. Can you also provide some color of other team members you have added to help you manage this growth?

One is, as today's announcement shows that we have inducted Priya Gandhi as an Executive Director to try to steer a few things at that level. Besides that, we are expanding. We have taken people on all sides. On the marketing side, on the finance side, on the technical side. In Africa, in fact, we have taken a local CEO over there. We have 17, 18 other employees that we have taken local from there. We have sent a few from here, 7 to 8 or I think less than 10 people have gone from here. It's difficult to exactly quantify and fit and give you a sheet that 10 people here, 13 people here, 20 there, it's difficult. But I do understand the growth and the people, there has to be in some proportion, and we are very conscious of that proportion, and we are making sure that all these things happen side by side. So that's -- I mean all that I can say, I'm not able to exactly quantify in terms of people, et cetera.

My last question, Mr. Gandhi, is that, as far as Africa is concerned, how much of our growth in Africa will be linked to how economic growth is in Africa vis-a-vis development spending or development funding, sorry.

Africa is a continent for everything, whether it is vaccines, whether it is for infrastructure, whether it is for anything. There is a lot of dependency on grants, external funding, et cetera, quite a few. At the same time, if you really go to see the animal population in Africa is very large. Tanzania, Ethiopia, Nigeria, even Chad for that matter. All these countries have a huge animal population. The current productivity of any animals in the African continent, in any country would be very much more lesser than what it is in India and even much more lesser than what it is in developed countries. So this scientific approach by giving vaccines, health products is definitely going to be a big assistance to them. We will have to do marketing and try to reach right up to the down level wherein people start using them. We believe that there are 2 types of market. One is the tender market, which could be either funded by each government or by big institutes like United Nations or maybe other international funding agencies. And now also, there is a market that is emerging that is a private sector, wherein there are more and more distributors coming up who supply up to the end level for the farmers, cattle farmers, poultry farmers, sheep/goat farmers. So this is an emerging market. A lot of ground work will have to be done by us, but the scope is huge as far as this is concerned, all our calculations are at this point of time, 70% on private market and 30% on the tender market.

[Operator Instructions] Our next question is from the line of Manish Jain from GormalOne.

I want to understand, we have been developing recombinant vaccines, along with other products that we have under our development plan. If you can just give some insight as to when do you plan to launch these vaccines? And then I have a follow-up question.

We are working on certain poultry recombinant vaccines as well as cattle, mainly Brucella is also a vaccine on which we are working on. Brucella vaccine, we hope that it should be ready sometime in the next year. I'm not able to give you the exact date. Our work on the recombinant poultry vaccines, there are 2 products, trials are ongoing at this point of time. And I would -- I don't have that data, neither am I -- have any of those people sitting with me would have guided me and I could have answered you at this point of time. But I feel that our Brucella vaccine should be the first recombinant vaccine, which we should be able to release. And later on, it would be the other vaccines. I'm unable to give you the date at this time.

And my second question was on the CapEx plans. Now that Tanzania is more or less complete, and your expansion plan you highlighted at the start of your talk, you can you just give some insight on the CapEx plan.

Everything that has been for Africa, all that has been already completed, and there are some minor -- which is inconsequential. As far as our CapEx plan for India is concerned for these 2 products, it is about INR 50 crores, that has been all -- we have tied up for that. We would not be -- I mean we have tied up with the loans, et cetera, for this expansion plan, and that's what it is going to be.

And my last question was on pet care division when we are talking about are we likely to introduce vaccines as well for pet care?

That is the -- in pets we would first go in for the health care products and then for the vaccines. The therapeutics, just a minute.

Yes, Mr. Manish, this is Priya here. For the time being, we are going to be concentrating on introducing some therapeutics supplements and dermatologic products for the pet. And of course, in the long run, we would be looking at opportunities in the Rabies vaccine, et cetera, for the -- in the dog.

[Operator Instructions] The next question is from the line of Prashant Shah from Serum Institute.

I had a question regarding your Africa efforts. It's a new continent for us. And I know you have done a lot of work on it. But what -- do you have any concerns regarding the acceptability of the product that is very something new. They may not have used to, they may not be aware of such kind of things. So there will definitely be resistance initially from the end users. So how are we going about overcoming this particular issue? And have showed anything as such.

Yes. Okay. In Africa, the situation is like whatever is selling is currently being sold in relatively lesser quantities but at an extremely high prices, where there are some products and vaccines, which are needed have not been sold at all till today, because there is nobody who is producing them. We have taken it up as a challenge. Yes, it is going to be a challenge, but we have taken up that challenge to introduce these products, first vaccines as well as health products and try to take the business forward. Challenges are going to be there. They will be quite big. We will have to overcome those challenges. But we have been talking to various governments in the African continent, we have given presentations at governmental level, sent information on what we will be producing, when we will be producing. So there has been a many -- there have been many communications correspondences directly with the veterinary -- their national vet division or whatever they call it, the department, veterinary department, et cetera. And we have reasons to believe that all this at some point of time will translate into actual business into demand by way of which we will sell the products over there. Yes, but I must say there is a challenge. But after all its business, we have decided to take on that challenge.

Okay. And after that, do you have any plans for the next level in terms of your -- the markets, because the U.S. and Europe are 2 big markets. So do you have any plans for those also?

At the moment, we are -- we would want to first stabilize all that we have currently being involved with, and then we will take up those next steps as and when. At the moment, there is no plan that we directly have for the American or the European market.

Okay. And coming back to Africa. So you said that your Africa capacity, Africa plant at 100% capacity, should be able to about INR 250 crores turnover in the next 4 to 5 years. What's the plan after that? Because that capacity if the product acceptance is there, like we are hoping, then that 4 to 5 years may turn out to be a very short time frame and we may need to do further additional.

[Foreign Language] Africa is a market where we are not very sure and there are a lot of challenges. I think we would want to take this without planning after that -- we want to take this for 2 years like this. And then once as we see the trend for 2 years, then we will want to talk about what will we do after 4 or 5 years. Because to be honest, our current focus is get this thing up, running, generate money, generate sales, generate profits. So that's what our objective is. We have yet to focus on what we will do after this reaches full capacity.

[Operator Instructions] The next question is from the line of Anirudh Shetty from Solidarity Investment Manager.

I had 3 questions from my end. So you had mentioned about that CapEx plan that you're incurring of INR 50 crores. So what would the revenue potential for that?

Yes. Okay. The expansion for the animal vaccine that we are doing over here are -- we are looking at near to doubling the current capacity of our plant at this point of time. It would generate a turnover -- an additional turnover up to anything depending upon the product mix from INR 80 crores to INR 120 crores. It could be more than INR 120 crores. That's what my CFO is indicating to me.

Yes. Okay, this is clear. Sir, the next question is on the pet business that you're looking to enter. So some what size perspective, a market size perspective and a growth perspective, would share some insight around that? And also please some details around the approach that we're looking to take to grow this business where the customer is different, supply chain might be different. So how are we planning to execute on that?

Okay. One is, in the United States, the pet market is the biggest market out of all the other animal markets. So that gives you an idea on the size of the pet. On -- in terms of marketing, how we want to do it? It is -- it should be completely different from what we are doing. As I mentioned that currently, we are producing vaccines, health products for production animals wherein people have a commercial objective in buying our vaccine. When they buy our Gumboro vaccine or the Brucella or Sheep Pox vaccine there is a commercial angle involved, because by giving the vaccine, the health of the host animal improves and what it is going to be getting in return out of that. So they are looking at the cost effectiveness of the vaccine. In pets like in human beings, there is a high quotient or the quotient is 100% emotional. So therefore, the whole marketing channel and everything has to be completely different from what it is as far as the current thing is concerned. I'll just hand it over to Priya to talk.

Yes. Mr. Anirudh, this is Priya. So when the pet market since already the multinationals are already existing over here, but what we are going to -- what Hester is going to focus on mainly some products, what we know from our back end market research is that, at the moment, what many veterinarians do is that they give human supplements and human medicines with -- in a different dosage. So for example, if I -- if we as humans are prescribed 5 milligrams, for dogs they'll give 10, but they use the same supplements that are given to humans. So what we want to do is, we want to make it specific to the dosage and in the presentation, for example, liquid bolus, whatever, that is more preferred for a pet usage as opposed to what is given right now which is existing in the human. That's one of the unique things that we are working on at the moment.

Got it. And just my final question, which was on the -- just the broader poultry and animal health business. So in the presentation you have mentioned, you're introducing new products to grow this business. So are these products kind of new to market where we are introducing something which is different from what other players are doing? And just a broader understanding of just the growth of the business. So is this like -- like our vaccine business today is quite under penetrated. So from a penetration point of view, with the health business kind of be relatively more penetrated. And -- yes. And so would our growth be largely from this market share gains, some what existing players what we can see.

Yes. Okay. So in terms of market penetration, we are actually, per se, more penetrated already on the poultry vaccine side. The large animal vaccine side, et cetera, is -- there is a scattered market where more penetration is needed. But on the health products side, the whole thing is that it's a very huge market and we ourselves are very small in this at this point of time. So that is something which we are focusing on and we would definitely be able to gain more. In fact, in all my press notes, stocks I have always told of a higher growth rate for these products as compared to the vaccine. Priya, would want to say something here.

Yes. Mr. Anirudh, in terms penetration, I would just like to draw your attention that Hester in collaboration with the Scottish NGO called GALVmed was the -- one of the only organizations in the world, but more relevant to developing countries partnered with them to give -- supply vaccines to the small holder farmers in the rural parts of Eastern region of India, and now we are trying to expand that. So what our endeavors to that project is the project, of course, got over with GALVmed in the 2018, but we are still continuing with a smaller division, which caters specifically to the backyard farmers with smaller flock sizes, smaller animals in the backyard. And what we do is we have the Thermo-tolerant vaccines of the Newcastle Disease, which can be -- which can tolerate or withstand higher degrees of temps. So we do these things, we do experiments such that we can cater and penetrate more and more into rural parts of India as well.

Okay. So would it be fair to assume that this strategy of ours little bit when you deep into the market, it offers us the opportunity to stay not only vaccines, but also health products.

Hello, your voice is muffing too much. We are not able to hear it clearly. Can you just repeat, please?

Sorry, sorry. Is this better?

Yes, this is better.

So just to clarify and understanding, essentially, there's a big market, it's under-penetrated for that, not only vaccines but also there's a possibility of selling health products to those farmers, and we are kind of getting a sense of that based on the collaborations and the projects that we've done deep in the maintenance of India. So the market is quite large and that pharma can be sold vaccine as well as the health products?

Yes. Yes, absolutely. The market is, I would say, I would again break up the market into the organized poultry sector and the backyard poultry sector. Currently, India in terms of organized -- it covers up to around 9-0, 90% of the market. So the penetration needed is very less over there. On the backyard poultry, India, I mean we are totally, it is only 5% that is covered, and that market is as big as the organized poultry in terms of population. In cattle, sheep, goat, it's a completely scattered market and a lot of penetration here would be needed to be done, which all companies are doing and the potential today of products to be sold in this market leave alone for our sales, this industry can grow more than 2 to 3 to 4x if this market as addressable as the market in the Western world.

The next question is from the line of Manish Gupta from Solidarity Investment Managers.

Sir, the question I wanted to ask was that, we are growing our operation across India and the value -- the per dose value, obviously, of our products is very small. What percentage of our districts would we have salespeople, which at our current scale would actually be a loss-making territory just because we are still in the investment phase. Would you track something like this? The question I'm trying to understand, essentially, sir, is that for the India market -- is our -- our margins actually far below what the margins could be because we are still in investment phase.

I mean, see, margins and the penetration, just a minute, let me -- just mentally understand your question. Your question is what areas are either under covered or covered at the moment, but wherein we are not able to make profit because we are trying to make penetration, is that your question?

Yes, yes. what percentage of our revenue would actually be loss-making right now?

I don't think so that there is any area where there is loss-making area. Yes, when we hire new people temporarily the average efficiency of the whole pool of salespeople does go down, because somebody is starting with 0 while somebody already has 100 credit to that person sales. So as we build up there is always increasing the efficiency. But at the same time, we go on adding people. So this is a continuous ongoing situation, but it is very difficult to pinpoint that Mr. A is incurring losses for Hester while Mr. B is making good profits. Ultimately, it is the territory and all the initial penetration and all has already been done. So today, if you take territory-wise, there is no loss making. If we take individual-wise, I'm sure at some point of time, there would be people who would be sort of "actually making loss for the company." But then that's a phase which anybody, everybody in marketing sales would have to go through anywhere in the world.

Yes, absolutely. Absolutely. Totally I get that. The idea was just to understand the amount of operating leverage in the business, this is very clear.

The next question is from the line of Harsh, an individual investor.

Yes. Do you have any plans for QIP, you had mentioned a few quarters ago. So have you firmed up any plans regarding that?

No, not at the moment, we have been able to raise finances through internal approvals through banks, institutes, loans, et cetera. So at the moment, we are still, QIP been proposed for an acquisition, which we are all the time looking for. If we do get an opportunity to acquire something, yes, we will trigger that QIP method, not till that time.

[Operator Instructions] The next question is from the line of [Arnav] individual investor.

I have a couple of questions, most of them have been answered. So on the pet division, I think Mr. Gandhi had outlined some of our thinking, is there a revenue number that you're also looking at somewhere 2 to 3 years perspective?

No. This division is in its formative stage. It would not be possible for us. We are yet forming all these things, the revenue model, et cetera, for the pet division. It is too early for us to give any indications on this.

Okay. That's very helpful. Is there any time line to get it started or it's already put it in place and the products are out in the market or it been still to pack?

No products are out. In 1 year's time, we will come, at the moment, we are studying, we are looking, we are trying to look at various products, choosing, shortlisting, packaging, designing because this marketing is very different from the current product marketing that we are doing. So I think you can give us 1 year's time by the time we launch products.

Okay. Okay. And the last question related to the revenues. You mentioned INR 250 crore per Africa by 3 to 4 years if everything goes well. And similarly, in India, we expect to hit INR 500 crores sometime '24, '25. Is that a fair assessment that if you add those up and things go well, then we'll be around INR 10 to INR 50 crores at a consolidated level in '24, '25.

Your voice is muffing. But as I understand, your question is that adding the 2, would that be right? Yes, because it's a forecast over here are different from the forecast of Africa. So at any point of time, both would have to be and should be added. One doesn't -- we are not talking of overlapping.

The next question is from the line of Manish Jain from GormalOne.

This question is mostly for Nikhil, where Nikhil, we are looking at -- you have earned INR 38 crores of EBITDA in the first 6 months this year. And so on an annualized run rate of INR 76 crores of EBITDA. And Rajiv just mentioned the INR 50 crore CapEx plan and the current debt-to-equity of only 38%, because your net debt is only INR 95 crores. What is the max debt to equity that you all will be comfortable with?

So overall debt equity that we are looking is maybe 60% to 40%, 60% to 40%, that's 60% to 40% is what we are looking at, as if debt equity ratio with the new CapEx and all coming in.

So 60% of debt and 40% of equity?

Yes.

So that means you can actually technically do upwards of INR 200 crores of acquisition. Should you want to without diluting equity?

Yes. Rajiv here. What you have understood is absolutely right. And that is the maximum that we could be wanting to go or we could go. But the path towards it would not be -- first, the small thing that we are doing over here, if we get -- if we get anything that we can acquire based on the size of it, how much money we would raise and how much of debt we would take and that is the way we would want to go further. Taking debt, working hard, repaying it off is always better than any other way of financing. But this he has given you an outer limit.

[Operator Instructions] As there are no further questions from the participants, I would now like to hand the conference over to the management for closing comments.

Thank you, everybody, for hearing me out as well as I hope I have been able to satisfy all of you with my answers. As I always say, there are times when I'm not able to give a satisfactory answer up to you all. One is that I may be lacking information too that due to whatever statutory reasons, I might not be able to say certain things. So besides that, I hope you all had a satisfying Q&A session. Looking forward to catch up with you all again in our next call, which would be in the next quarter. Thank you very much.

Thank you very much. Participants, on behalf of ICICI Securities, that concludes this conference call. Thank you for joining us, and you may now disconnect your lines.