IFB Industries Limited ($IFBIND)

Ladies and gentlemen, good day, and welcome to the IFB Industries Limited Q4 FY '26 Earnings Conference Call. [Operator Instructions] Please note that this conference is being recorded. I now hand the conference over to Mr. Binary from Nirmal Equities Private Limited. Thank you, and over to you, sir.

Thank you, Steve. On behalf of Nirmal Bang Institutional Equities, I welcome you all to the Q4 FY '26 earnings call of IFB Industries Limited. I thank the management team for giving us the opportunity to host this call. From the management side, we have with us Mr. Sandeep Jose Pavraham, Managing Director and CEO, Home Appliances Division; Mr. C.S Govindaraj, Executive Director, Manufacturing, Home Appliances Division; Mr. Soumitra Goswami, Chief Financial Officer; Mr. Jayanta Chanda, CFO, Engineering business; Mr. Santana Chokraborti, Plant Head, Engineering Business; Mr. Kartik Michandi, Head, Finance and Accounts; Home Appliance Division; Mr. Ranjan Mohan, National Sales Head, Home Appliances division. So without taking much time, I'd now like to hand over the call to the management for their opening remarks. Following the management commentary, we will open the floor for a question-and-answer session. Over to you, sir. Thank you.

Good afternoon, everybody. I am Soumitra Goswami. I welcome you all for ID Industries Limited Investor Call for Fourth Quarter of FY '26. Firstly, I will be informing you about the quarter 4 results. Revenue for the quarter was INR 1,456 crores against last year INR 1,312 crores, a growth of 11.03%. PBDIT for the period was INR 80.7 crores and its percentage to revenue with 5.5% as compared to last year INR 69.4 crores, which were 5.3% on revenue. There is an increase in PBDIT amount by INR 11.3 crores which is a growth over last year by 16.3%. Fixed expenses for the quarter were well behind budget. PBT before exceptional items for the period was INR 46.05 crores, which is 3.2% of revenue against last year's figure of INR 29.3 crores, which is 2.2% on revenue. In this quarter, an incremental liability of INR 0.58 crores has been recognized as an exceptional item which is in line with Labor Code notified by the government of India on the 21st of November 2025. This charge has reduced PBT amount to reach INR 45.47 crores, to 3.1% of revenue as compared to last year INR 29.3 crores, which was 2.3% of revenue. Quarter 4 PAT over INR 33.72 crores, which is 2.3% on revenue basis last year to INR 22.29 crores, which is 1.7% of revenue. Now YTD in March 2023 figures are like this. Revenue for the period was INR 5,476 crores against last year, INR 4,977 crores, which is a growth of [indiscernible] For the PDO. PBT for the PI was INR 334 crores, which percentage to revenue was 6.1% as compared to last year INR 325 crores, which was 6.5% of revenue. Fees expenditure for the quarter were well within budget. However, in case of some of the expenditure had in the unit has increased over last year. PBT before exceptional item for the period INR 193.5 crores, which is 3.5% of revenue varies last year figure of INR 171.26 crores, which was 3.4% on revenue. In YTD period and incremental liabilities of INR 13.93 crores has been recognized as an exceptional item. This is in line with the labor code notified by the Government of India on 21st November 2025. PBT after exceptional item on the PD or INR 179.63 crores, which is 3.3% of revenue last year [indiscernible] INR 126 crores, which was INR 3.4 crore tax for the year was around INR 334 crores, which is 2.4% of revenue reset last year, INR 128.9 crores, which was 2.6%. Before we start the question and answer session, I want to like to introduce Mr. Sandeep Jose Pavram, MD and CEO of our Home Appliance Division, who has recently joined on 8th of April in our company. We will take all the calls on the questions today, which are pertaining to Home Appliance Division. Mr. Chairman, Mr. Vikram is out today, he is not joining the call. We will request to start the question and answer.

[Operator Instructions] The first question comes from the line of Laxminarayan Kaj with Tunga Advisors. The current participant. We go on to the next question is from the line of Naitik with Fund.

So my first question is if you could give us a breakup of the sales that we have done in the quarter from EC from [indiscernible] from soft load Mr. Mark candidly tell this question.

Yes. So basically, you wanted to know what is the percentage of sales to the total income amount. Yes. or the numbers you wanted. So we don't spend opted. So we don't give the numbers, but we will just tell you that in front loader, we had a good double-digit growth in this quarter. and top loader has been good for us, and we have been able to improve our market share. Again, our very good double-digit growth in microwaves. Also, the growth was in double digit in quarter 4 and a very good growth over last year. Then if I further move on to ACs. AC growth was muted the growth in quarter 4, we were able to recover something, which because of last in first quarter because of this early monsoons, et cetera, the AC industry showed a major dip, you were able to recover in quarter 4 update, but the growth was not very good. That's how it is.

I think the other thing that we have done is that we have actually relooked at our product portfolio. and those considerable amount of simplification of our product portfolio that has been done. We reduced our number of models that are there in each one of the categories. that has been a very conscious effort from our side to simplify the entire process. And as a result of which, what we are finding is that our revenue growth is significantly higher than our volume growth in most of the segments. That's a conscious call that we are doing. We entered a portion of it in -- towards the end of Q4, and we are continuing it in Q1, and that is going to be an ongoing process. The idea is to simplify our product portfolio and sort of make it easy for everyone, including the dealers who are dealing with our products.

So these simplifications are basically due to where should it be seen in terms of numbers, whether the inventory would reduce or would see increased revenue contribution or growth or we'll see cost savings? How can we sort of see the slowing into numbers?

Yes. So there are multiple things that could happen. One is because the portfolio is simplified. Therefore, it should definitely help us in our numbers because from a dealer point of view, from a stocking point of view, from a forecasting point of view, the chances of of modules going out of stock and all become that much better. So simplification of the product portfolio will definitely help us as far as our -- as far as sales is concerned. It will also mean that the portfolio being simple, the kind of focus that will be provided by everyone in the same system, right up to the person who's at the outlet would also increase because we've got lesser number of products to detail therefore, it becomes that much more easy. From other point of view, simplification would also be manufacturing should get the benefit out of it because there's a number of SKUs to be made as a result of the changeover time and all those things get impacted. So it will help us in all ways. What we also, therefore, are able to do is that we are able to push this whole dating of premiumization because now the number of SKs are lesser. And therefore, at various levels in our sales system, we are able to ensure that with necessary incentives are provided to ensure premiumization has also happened. So in my opinion, rationalization of products will have impact everything. It would have an impact on sales. It would have an impact on factory production, [indiscernible] everything.

One clarification I needed. So if I look at your presentation, on Slide 13, what we have mentioned is that front load will need the sales of a number of front load units has increased from 1.4 to 2 lakhs. Now I wanted to know if this is our sales or -- because if I just back calculate, 50,000 units addition Q-o-Q, that would give me at INR 40,000 on realization that could give me roughly INR 200 crores of debt GOP in terms of revenue. While our revenue in home appliances have increased only by INR 50 crore or INR 60-odd crores. So if the math [indiscernible] first? Or is your understanding correct? If not, then what objective is the number?

So the volume growth in April is 7 percentage for the entire year, it's 20% for the quarter, and the revenue growth in front order is 11% is for the full year.

Yes, Carter, I would clarify. The numbers what we have given is the industry number for 20K and above. So it is on our number.

[indiscernible] actually is a new emerging segment that is there. And today, it contributes to almost 13 days of the overall if you look at 25, 26, it is about 13% growth of the overall market, 2 and above. So that's a new segment that has come up. It's really come up in the last couple of years.

And the 1% you mentioned is Y-o-Y growth in our [indiscernible] role just for moderator.

For the quarter, we Yes,. I didn't get.

For the quarter, we have won by 21% and Y-o-Y, it is around 8%.

And Mr. Mata Mr. Mathur and Mr. Abram have to tell your name before answering the question. They'll not be able to track it.

Sure, sure.

Got it. Sir, my next question is we have spent, give or take, close to INR 500 crores in terms of CapEx in the last 6 years. And the last 2 years especially has been INR 100-odd crores of CapEx per year. So just wanted to understand broadly what categories have we spent the INR 500-odd crores in the last 5 years? And what is the sort of revenue that this CapEx can give us?

Yes, it is very right here. In home appliances, whatever investment we have done, the -- about 50% of the investment, whatever we are doing is on the new platforms. like what Mr. Abram was selling on the higher capacity machine. So we are putting investment into 3 kg and 14 KG segments in front loader. And the second thing is we have put in some about INR 30 crores on the expansion -- capacity expansion of front loader, top loader and air conditioner line.

So your question comment. Your question on the segment of 120. We currently operate in the 120. And as Mr. Onward said, that we will be launching after 12 cases that we'll be launching a 13 and 14 in the current quarter in this year.

And how much have we spent in Homans in the last 5 years in terms of CapEx out of the final roughly?

Sonia here, I am telling you the figure for current year, current year total company-wise number is INR 89 crores, 85%. Out of that, maple divisions I'm telling you. Online -- can you around INR 43 crores. OMAP division alone is INR 4 crores to -- got it. And the rest would be the automotive division. Engineering division and motor division, all these segments had were also [indiscernible] branches we are Kolkata and also stands.

Got it. And sir, last question is, if not further Volta ForEx movement there, we lost almost INR 50 crores, INR 55 crores in the adverse movement are margins safe to assume that our margins would have been higher by that INR 50 crores, INR 53 crores that we lost 2 to 4x.

Kartik, you can answer this.

Yes, Sandeep. Now basically, if you look at the full year, the impact on commodity as well as ForEx was about INR 5-odd crores. And what we were able to do because of the program that we are running on cost optimization 258. About INR 67 crores of that, we were able to make up because of our cost optimization program that we are currently running. There are a lot of other initiatives like increase in prices things like that. So a large portion of the commodity and products we were able to make up because of the other activities that we have done. If we have not started that program on cost optimization, then I think you already got very badly impacted because the P&L would have hit by about INR 84 crores because of commodity. So in the entire impact, now we have mitigated the entire INR 84 crores impact. So if things stay as is that INR 84 crores should come back to profitability, right? In the next year, if the commodity prices don't increase and the ForEx also does not increase as much. Yes. So there are 2 things that are there. One is, ideally, we would have liked to pass on everything to the customer. But today, that's not possible because of competitive and related position in the market. Therefore, we are looking at opportunities to increase our prices wherever it is possible. We did something in Q4 and Q1 of this year, we've already taken price increases in almost all our categories. So some amount of that, we will have to make up with price increases and our cost optimization programs would continue. For example, we've already seen about -- if you look at April, May, we have got about INR 29-odd crores, which has come because of the cost optimization. So 67% for the full year of last year. And in April and May, we have already got about INR 25-odd crores. There are new ideas that are coming in. And we would like to believe that in the next 10 months, another INR 120-odd crores would come in, in the form of CI. So that should help us a combination of cost optimization ideas, any opportunity of a price increase, all that should help us sort of take care of any further impact because of commodity and ForEx. And if commodity and product does not get better, then it should start flowing into the P&L because the program that are there has been -- in many cases, it's been horizontally deployed. So the benefits continue. And therefore, a softening of commodity and ForEx would have a positive impact on the P&L.

Got it. So this year, total we are expecting INR 150 crores impact

Yes, that's what we are expecting INR 30-odd crores has already been realized into the P&L. And we would like to believe that in the next 10 months, another INR 120-odd crores would come in. It also depends on the season because the CI programs are different for different category. And therefore, it's got that seasonal impact because today, if you see where we see semis moves over, it will come up only in Q4. So there are those seasonalities that are there. So what we would expect another INR 120-odd crores to come in because of CI. How much of that will come into the P&L will depend on how ForEx and commodity actually moved in the months to go.

Got it. So just last question. So in terms of AC as our OEM sales completely dropped because in the base quarter 4 '25, it was almost INR 100 crores. So has that completely dropped off.

It has not completely dropped up. There are a few OEMs that we are supplying, but it's not completely talked about. But a couple of OEMs who want to name them, but we used to pick large volumes from us. have at stopped and presuming a better options from somewhere else, but we're not completely stopped this year also we are doing. But some of the big OEMs, which used to pick up the volumes from us earlier, [indiscernible] model of stock.

Yes. I think here, I'll just add 1 point. During last year, there was 5% degrowth in OEM, not a substantial.

Last year, as in FY '26, you're saying or?

Yes.

The next question comes from the line of Vinod Krishna with Aventis Wealth.

Sorry, am I audible, sir?

Yes, you are.

Can you share with us market shares in top load and encoded what stage we are in filling this product guys? Because if you see from the last 3 -- especially last 3 years... We have been continuously talking in our presentations because that's a primary product, continuously filling the gaps in products. So how far is that generally come? And what are our market shares in both front loader and top loader, sir, if you can share, please?

So our front order is about 23-odd percentage is what our encoder market share is. And as I said in the earlier thing, this is despite not operating in the 12 kg category which has been -- which is now 12 percentage of the market. If you were to remove that 120, we are at about 25 to 26 percentage. That would not be right because at the end of the day, 12s part of the market. And therefore, if you look at it, we are at about 23-odd percentage. However, we will be plugging the gap this year by launching suitable products in the 13 and 14 cases which would also then give us a play in the 13, 14 kt. So we are at about 23-odd percentage overall. And if you look at our addressable without taking 20, we will be at about 25% to 26%. Top loader, we are currently 9 percentage. We are growing in top load of our market shares have gone up and if you actually look at our volume growth, we have actually grown by about -- full year, we have grown by about 19% is in capital.

Sir, this product gap. Are we at the end of this or instant how should we understand? Because continuously, we are seeing every presentation, especially in the washer segment that we are plugging in this. We are into this chat a premium offering and all -- so -- and can you name like if you are 25%, how many other people, is it like other 2, 3 people, Opin22? Or is there any big guy because I'm sorry to ask because is there any other big competitor like who's much larger [indiscernible] all other people are around [indiscernible] only.

There are people at different categories doesn't want to mimic, but there are people who are in different categories. we are currently #2 in this, but there are people different categories. There are 1 of past or 3 who are major player others are fees players or the process. It is a continuous process because as you would see, the 12 kg as a segment was not there. And today, it is contributing to about 12 to 13 percentage of our entire -- the entire volumes of the market. And therefore, there definitely seems to be a customer movement towards larger capacity. Is it commercial laundry or is it because of double income. There is definitely we are seeing a movement towards larger capacity. And answering your question and.

No, I'm not able to hear. Is it the same for everybody or I am the only person who is not able to hear properly?

Mr. Abram online is not here. Some here. I am also not worrying whatever coming up or.

Sir, he got disconnected. I'll just reconnect him. Okay, sir.

Sorry, I don't. Again. Just continuing from there saying that it is going to be a continuous process. not just on the 3G. You might -- as I said, we are now 1 remaining larger capacity was -- and also, there could be euro features that are coming in because people are looking at new freeform that's also an option. So it will be a future improvement as well as perhaps looking at different categories and higher capacity of our missions.

And just a follow-up question. So you sir spoke about INR 120 crores or INR 150 crores of what -- just in my understanding, there's a limit to the cost reductions that we can do in the long run because ultimately, you start affecting the product quality on the brand. So -- and virus has been always telling us about we should minimum grow by 20%, and we have the gaps in distribution, sales channel and the product. Total having -- as refrigerators being present across. So how far are you in this either we can start kicking in the 20% growth in home appliances because you have done the CapEx and refrigeration now, like how should we think because these last 2, 3 years, if you remember, sir, has already, we've always been saying that we should mium grow at 20% even if you fix this distribution and product gaps.

So if you look at last year, we grew by 10 percentage. And what was pointed out is right. There's only limited that you can do as far as CI is concerned, that's also a continuous process. we have to keep finding out new things, but the bank that we are cost optimization cannot be at the cost of features and by reducing the quality of the brand because that would fill IP as a brand per se. So we cannot do cost optimization at the cost of the current price positioning and our brand persons concerned. So can't be doing that. However, there are definitely process improvements that are there. So that is one way by which we will do it. Answering your question on distribution, yes. If you actually look at it, we have identified this is our data, we have identified around 10,000-odd outlets, which we believe are contributing to about 80 percentage of the volumes. And we said that we need to concentrate on those counters. And all our reports are to ensure that we get placement and extraction from these outlets, and that is what it is. And therefore, some of it has started kicking in and the first 2 months of the year [indiscernible] is looking really well. And it's somewhere to the number that you are talking.

So sir, and our market share in -- as and how are you looking at ACS and refrigerators going forward and at what growth rates and what like product portioning and -- how are you seeing your success? Or what is your learning in these newer cities that we have entered?

Yes. So obviously, we are.

Hello?

Yes, sir, just a second.

So the -- so it is much more fragmented than in the case of a case of a washer. We are currently over 3%, 3.5% base is what our market shares are. And that continues that we have to grow significantly. And our aspiration is to get into double digit as far as the market share becomes [indiscernible]

Sir by when, sir, by when in double digits, if you can -- is there any time line on.

So our aspiration is this year, but that's going to be a tough ask, but yes, we are working towards that.

Just for my understanding, how do you -- when you have 7 to 8 players. How do we think about getting and like just help understand how we can IFB go ahead and become a 7%, 8% or 10%, what are the factors that gives us the confidence that we have the right to go and gain that market share, if not this year, next year or in the near future, okay? I'm not saying timing is a thing, but what are the factors that are giving us that confidence that we can definitely go there and have a portion of 7% to 10% or 8% to 10% in the long run? Like how to think about it? Like what is giving you that -- what are the assumptions that you are making?

So basically, the most important and the biggest factor is by a view of the brand in the categories that we have operated in and in categories where we are intense we have significant market share and more importantly, our products are doing the pocket. And therefore, IFB, as a brand has got standing in the market as far as quality of our products or concern quality of our service is concerned. So that umbrella effect of IFB as a brand is definitely our biggest asset or number 2 is that because we are very strong in an many of the categories that we are operating in, we already have our relationship with outlets where people out there. And therefore, it is now a question of ensuring that all the tie-ups are done and the placement of come and the extraction happens. But answering your question, I umbrella brand acceptance in the market as a product which delivers is definitely our biggest strength. And if you have done it for washing machine on the autonomics, we have done it with dish washers and all the things are all these places that we are operating. We have done it. And therefore, we believe customers would say that IFB is a great investment to make

So we are content of growing north of 20% from this year then in home appliances? Is what you are aspiring?

Yes.

An engineering division, can you give a 3-year outlook on the growth side?

Now we are around INR 1,000 crores. What is our engineering division outlook because you're doing a lot of CapEx in there. So what is the sales growth outlook there or a 3-year, if you can share with us because it comes at was saying that we should do -- we see higher growth now in engineering and a lot of opportunities.

Yes, [indiscernible] here, I will take this question. So if you look at the revenue trend of engineering division over the last 5 years, it has a revenue low of CAGR is about 13%. Over the next 2 to 3 years, the -- what we have planned is a 20% to 25% growth on the existing business. We are also in the process of adding new revenue streams to our business. for example, battery parts, medical change manufacturing and brakes, which is the concom under the new leg. So we are getting into these businesses also. So with this combined the -- we have a business forecast of 20% to 25% growth over the next 3 years.

Even without the new verticals, you will be able to grow 20%, 25%.

Sorry, come again?

Even without the new verticals you're talking about this.

Yes. On the existing business, we will grow by 20%. And because we have recently added some capacity to both our plants in the last 1 or 2 years, and we are in the process of adding some more during this year. So our values are good. We are a B2B business. So our steels look good. And we are confident of hitting this.

And any target EBITDA margin, sir, at the end? I'm not saying because in the middle, you may have a lot of ramping up costs. But others, what would be the target EBITDA margin?

Target EBITDA margin is 17% to 18%. We already grew about 15%. So there is a 17% to 18% EBITDA margin, we are targeted --

So from here, can we -- because I'm the shareholder from the last 7 years, can we assume that IFB will grow at north of 20% over the next 3, 4 years, sir, becomes that I think we have started the Germany inflection point, and we assume that few investors.

The next question comes from the line of Chira Gandi with Astral Investments. Sir, you are coming very low. Could you speak a bit louder? Yes, please proceed.

Sure. First of all, bank for the opportunity. So I had a question on your home plans we understand, in second half of last year, we had a negative impact of RM cost inflation and ForEx movement. Do you see, at least in Q1, any further impact of increase in RM cost?

Yes, Sandeep on cost is increasing further, both commodity and ForEx. If we look at our April to May, is having a negative impact on us. And that negative impact currently has not been met or the cost initiatives that are here. So answering your question, April, May is also showing a negative as well as commodity and ForEx is concerned. So will you be able to quantify how much of that will have a negative impact on the [indiscernible] If you look at between commodity and products, the negative is about INR 45-odd crores for April, May cumulative.

Understood. And of that, how much of that we can be offsetting with the cost measures that we have taken?

The cost, we have offsetted about INR 29-odd crores in April and May. So out of 49 29, 29 has already rolled into PLF. And now we'd like to see how much we can make up with the price increases, I remember that you. We have already taken some price increases and we should start seeing the benefit of that in the next few months. And also we have to constantly look at opportunities become market and our relative position in the market, we'll have to continuously look at ways by which we can pick it up further. I believe if we could have passed on the entire commodity and ForEx to has a price increase, that would have been ideal. So that's a cost impact cost initiatives close into the P&L has a benefit. But unfortunately, we are not in a position to pass on tie to the customer.

Understood. Is it cost us a highlight 2 to 3 areas where we are able to save cost? And for the target that we've given for another INR 120 crores for the next 10 months, what are the 2 to 3 key areas where we'll be saving the cost.

We will not be able to -- this is going to here. We will not be able to tell the specifics, but it basically designed to value and focus on cost innovation ideas in electronics. Initiatives, as I said, we are also seeing that one of the benefits that we will get is on the tightening up our cost to serve. That's something that we would look at. and some benefit coming out because of better management of our trade schemes is also somewhere where we should get some benefit coming into the

Understood. And in terms of the components that we improved, what will be the share in overall RF cost?

Number? complement, what is the input content. Import is about 30-odd percentage is what the import content is. We also import some units per se. So if you take our Manufacturing imports is about 30-odd percentage. But if you take other imports everything put together, currently about 3-odd percentage 30% is some of those items are not going to get near -- and therefore, the 30% growth, we are expecting it to come down to about 25-odd percentage and the 39 percentage which is our overall import would come down to somewhere around 30% to 32% is what it will come down to -- so there is some indigenization that is happening.

Understood. Just last couple of questions from my end. One is on the engineering business. In the presentation, we have mentioned that we have missed the order wins target that we had for FY '26. We achieved, I think, around INR 150 crores versus target of INR 250 crores. Any particular reason in terms of missed on that target?

Yes, sir, could you repeat the question, please?

0 Sure. So my question is on the Engineering division. We had set a target of INR 200 crores of new order wins for FY '26, and we achieved around INR 156 crores. So can you explain the gap?

Yes. The -- see, the order maturity in the engineering business takes a long time. When you see the order win that means the PO has been issued to us and suppliers. But before that, there is a 7 to 8 months validation time where parts of drawing approved partner through the samples are given and all that. So whilst the marketing department is actively working on a large RFQ base, the actual completion of the service was INR 153 crores. The pipeline is live, and we are hopeful of closing all these orders in -- by Q1 or early Q2.

So any target for FY '27? And then what is the order patent we are, if you can quantify that?

Yes. Actually, this [indiscernible] FY '27, we are finalizing INR 350 crores addition. With the cost along. All the previous. These are new orders that these are new orders that we are chasing and once all parameters are closed, then we will be getting the view from the OEMs or Tier 1s that we have negotiated

Understood. And the last question is on the BLDC motors. So within BTC, we were facing some challenges in AC motor segment. So any update on that?

An arid -- and. I don't think the. They have resumed the supplies to on the washing machine motors in a large scale. The [indiscernible] is still going through some trials because I think there was some. It's not fully resolved it, but very close till solution. That's the information I have on motors.

Just a clarification. So the entire AC motor sale is internal, right? We are right now not supplying anything into the external OEMs?

Up till now, yes. In the very active and for external customers as company.

The next question comes from the line of Saket Kapur with Kapur & Co.

Yes, thank you for the opportunity and hello by Motiva. Yes, sir. And welcome, Sander, joining the organization. We hope for the organization new heights under your leadership. Yes, sir. Sir, firstly, as I have a question firstly for the Engineering segment. As the person outlined to us that we are expecting a 25% growth in our revenue growth for the current year. with the vertical with no addition in verticals. So what kind of capacity utilization levels are we running the division? And what is our CapEx that we are augmenting in our existing facility to ramp up the volume that we are union.So last year, sir, in the engineering division had got an approval of nearly INR 100 crores of CapEx basically.

Now we have been able to implement only INR 63 crores in the until March and it is being carried over this year because some of the projects took time to materialize after sanction, we initiated that finalization of the chain plant manufacturing site was -- took some time to identify. So out of that INR 100 crores. We added capacity in our stamping division. There were 3 presses added to camping division. That has given a revenue capacity about INR 40 crores to INR 50 crores in this stamping division. Could both the plants in Kolkata and Bangalore opted for fine linking press each that will easily go about INR 30 crores to INR 40 crores each to the plant. So -- and from auxiliary machines and furnaces have been added. So all these to balance the line and the ramp and looking at the sign new orders -- this year, our target is about 23% over what was our last year's revenues. So that's how we are posing the [indiscernible]

Firstly, if you could just explain to me what exactly goes into consolidation. When we look at our stand-alone number and then the concurrations both for both the segment of Home unplanted as well as engineering there is an increase in the top line and also it is positively also impacting the bottom line. First explain the consolidation there. And then when we speak on the growth, I expect it could be on the consolidated number? Or what to factor into?

Sorry to hear, I am not understood the question.

So when we look at our revenues on a stand-alone basis, the number is INR 1,447 crores for the quarter. When we look at our consolidated number, it is INR 14. So I would like to. Yes. What goes exactly into the consolidation? And that is the car question, first.

We have subsidiary apart from the stand-alone division, which we have like one plan decision like engineering division motor dissasteel division, we have some subsidiary, 1 subsidiary executed in Thailand 1 subsidiary fitted in Singapore, their revenue is getting added. So you are seeing that the consolidated revenue is some marginally higher than the stand-alone revenue number.

Yes. Understood. And sir, thirdly, we have also, I think, established a new subsidiary in Switzerland. So if you could just explain the merits and how is the organization going to benefit from this, I think to be advanced tooling subsidiary in Switzerland, it.

I can take this question. Yes, I will take this question. So tooling is very central to the engineering business, whether it is that something fine blanking, tooling is the core of the engineering business. Whenever we make components, we need to manufacture the tool first, which will produce the components when it is put on the press. So a good tool produces components in much more efficient way. My efficient way the strokes that the press can deliver can improve. The tool is better. And the secondary process is that a component needs to undergo after the blanking reduces, if it is produced through good tool. So the tooling capability in fine blanking, Switzerland is host to a company called in 2 where which is considered to be the father of fund banking duel.And being a lot of tooling talent available there. So the intention was to set up a company there, basically, which will focus on in to designing and better tool designing complex to and in transfer techies and all that. So with that intention, we have set up this company there. It's about 5 to 6 months old. And the already involved in designing and felt study, many of the tools that we -- in our pipeline now, and the improvement of our existing tools, they are also into external businesses. The brief to the industry. They should not be dependent on MDI they will do with an independent business also. So they have got some orders from the Spanish company, letting the aground the pace. It has just started. I think December, it was incorporated, and it has started operations.

First, it is to be considered as both a technology transfer R&D unit as well as a unit that would be contributing to the revenue. That understanding is correct, sir?

It's an independent company from where we will source to the design and so by whatever name you may call it, but the nature of transaction will do this.

Okay. And what kind of investment have the metal currently for the same?

See, there will be no heavy equipment of the into design unit. So basically, it's a I wouldn't like to immediately give us the figures, but investment is not very much because it will be a design company active for the time being.

Okay. And sir, lastly, when we look at the current environment, in terms of supply chain issues in terms of the inflationary impact, then the BP dollar movement and also the steps that the company has taken to reduce the cost on -- reduction on the cost side, logistic cost how are we looking at the current year? And also, already we are into 2 months -- or in fact, 2.5 months into the business, how is the working environment, especially in terms of our home appliances category, what kind of part of the market you can share with them?

Yes. So from a revenue point of view, the first thing on certain very good. I said we've always been talking about 20% growth in that. We are on track as far as the revenue side of concern. However, we -- on the on there is this issue, as I said, that our cost optimization has not been able to recover the negative impact of commodity and ForEx. So that's not been recovered. But overall, when we look at it, we are quite bullish on our revenue should really start kicking in. We should get a lot of cost optimization on, but we are looking at various other ways by which we sort of tighten our operations. stop all to this call, there are any. So we are confidently looking at it, whether it be skin, whether it be anything productivity of our man core. So all those things are being done. And this over a period of time at other elements of commodity and ForEx sort of [indiscernible] then a lot of the activities that we are doing will remain and if commodity and ForEx results when we get to benefit for that. So from a market and from a sales revenue point of view, we are quite bullish, and we are only hopeful that some of the negative impact, if you can [indiscernible] up, then our P&L will be much stronger than what it is now.

Okay. And lastly, so just to conclude that it is -- the royalty in the market is there. But on the margin front, we are not able to fully recover the cost inflation. So we will be able to be there in the same margin that we have posted, but incremental margins are not possible because of the pass on impact. That understanding is correct, sir?

Yes. buoyant for us, the boring there because we are seeing increase in market share. So we not necessarily because penetration of it is increasing. Yes, there could be some movement because of that. But we are definitely seeing a voice, which is resulting in market share increases. This is good for us. But yes, overall, I think that for the negative impact there be a reason to believe that will be muted. There's no reason to believe that, at least for more revenue and sales and volume growth are concerned. And then some of land categories that we're getting will give us a traditional benefit.

Okay. And lastly, sir, on the share of profit or associated. I think it is the replication portfolio that will -- that is contributing and that has positively contributed to the tune of INR 4 crores for the quarter. So how is the performance for the IFB repriciation made and for the value unlocking part also in terms of the refrigeration unit any road map or if you could outline to us how are we looking at that segment?

So the volume growth has been good because as I said, our shares are low. And therefore, from an absolute volume and value growth, both MBS [indiscernible] and refrigeration has been good on both volume and value growth. but it's still not where we would like to be. And from a margin point of view, our water segment is technically something. So growth in the washer segment will definitely have a positive impact on the [indiscernible]

Okay. So for the share of profit from the associated for the depreciation business only -- that doesn't take into account. Yes, [indiscernible] INR 1.4 crores I believe, which is for refrigeration in a company -- we at INR 1.4 crores due from refrigeration is correct. What is the outlook for this category.

Integation is a separate business, which is a separate company. We will not be talking on the recognition business where. If you have any question, what about refrigeration, we are selling from IT industry that Mr. Aram can discuss -- but on the [indiscernible] unit as a whole is this a separate company, we will not be talking on that on this [indiscernible]

No,sir,my point was that for this quarter, it is INR 4 crores of profitability not INR 1 crore for the quarter ending share of lower or share of loss is 15 Yes. That is for the entire year you are mentioning. I'm just mentioning the quarter contributing.

Yes.

Yes. The quarter condition has gone up to INR 4 crores. So I was just trying to understand the outlook on the same? And I think earlier also, the management has spoken about how they can potentially create value from the same segment since it is being hold by 2 of your good companies. So that was my entire question, sir.

Can you talk to me separately on this, sir?

The next question comes from the line of Rashi an with Tunga Investments.

Am I audible, right?

Yes, you are.

My question is to urban. Being you have spent over a decade ensuring that vehicles stay from the grip of Indian roads with Amara now you're looking at inside of the Indian phones with ISP. We are coming from a company that has aggressive cost control and incredibly tight the predictive supply management, supply chain management and has set up an incredibly good robust exclusive dealer network, right? So from that vantage point, and when you evaluate our we evaluated the ASB by walking around in the last 2 months, what would be your immediate 3 or 4 priorities maybe in the next 1 year to 3 years, like.

Respond to are your parts. Yes. So I think, as I said like the company that I came in from the brand is very, very strong. It is well accepted like my previous company, it is well, et cetera, by the customer. And therefore, Half the bat is one when we don't have an issue of acceptance of the brand and the fact that the brand is higher as well as the customers' configuration is concerned. What could definitely improve? Is that a lot of processes of Mr. Madan the team has already put in place I -- some of you already has started to have conversations with over tile I'm in the company only for 2 months, but I've been talking to them prior to that also. And a lot of those things have been already put in action when it comes to improving our cost to serve the way we manage our dealer network, flagging any leakages that are there when it comes to the way we operate our schemes. So a lot of those things can be done. The focus is already in place. Many assets that the company has already done. But I think my expertise over the last year to the last one that I had. I hope to be able to bring in a lot of that expertise and bring in a much more tighter management of ethane. Priorities you have qualitatively or quantitatively for the EMEA on a long term. Yes, definitely, when you look at. Our distribution reach. We have already identified the outlooks that we would want to be presented that cost is already completed. We are keeping close to about 10,000, 1,000 of outlets, which we believe are the ones who are contributing. And therefore, that exercise is over. Now how do we get the maximum out of it replacement as well as extraction from there. So that is one key thing that is the [indiscernible] note to this industry depends on lot on the person who is in the store, call it in-store promoter or whatever. But he is a pretty active role to play. And therefore, a lot of time and approach has been made on to bring more number of our dealers under the coverage of these in-store promoters. But then increasing the number alone will not work, but how do you bring in tighter controls over productivity. So there's an exercise that we are doing which is measuring productivity of these people. And number 3 is we need to look at the profitability of our products. So we are currently looking at profitability at the SKU level. And as I had mentioned earlier, this has been an see,and there has been large-scale portfolio rationalization that has been done, for example, in encoder at one time, we had 58 models. Similar exercise has been done for top loaders and all our categories. And therefore, looking at products that at the SKU level and see what needs to be done on simplifying our portfolio, making life simpler for everybody. Is it a thing that we are concentrating on the duty is the brand is really strong? And I firmly believe that we have got a wonderful team of people who are veterans in the industry. And therefore, they have the relationships. Coming from outside can put some tighter controls on the ships so that we get the maximum amount of the brand, the team and the products that we have.

Got it. And my second part is that if I look at the previous presentation, there are 2 data points which are there. One is in terms of the average what is the inventory holding base of the Home Appliance division and also the split of home appliances across various product categories. So these 2 intonation is actually is not decent in this sensation. I just want to understand whether any of that information can be diverted in this card? Or this is the new normal?

Yes, Kartik. We can provide it separately to you. But as we already said to you, the anal inventory last year, there was an issue in March the channel inventory for EC was very high. So this year, those issues are not there. The inventory is at a healthy level, and our holding also has come down.

We'll work on very, very. We don't want old stocks to remain in the system. So that's constantly being looked at so that never would be to try and get as a product that is possible to the customer.

Yes. And the third is in terms of the cost optimization, there is a plan of INR 200 crores, which was outlined and in are on track, as we mentioned. Now on that is in addition to it, I believe there is a fixed cost optimization plan out of being undertaken. Can you just help me understand where we are on the journey, what has what has happened in the last financial year and what is the total amount you think you can actually say and just an update would be helpful.

There's not much that has moved into the P&L. That's something that we are looking at with our [indiscernible] because as I said, there's only a limit to which passes and I can bring in. And for all our cost elements we'd like to look at and something that we are looking at is a means why with something we turn on the [indiscernible]

Sorry, if I just tariffs, what I can interpret is fixed cost savings have not materialized in FY '26.

Nothing substantial to [indiscernible] nothing substantial.

And do you anticipate any fixed cost reduction in FY '27. Is that a plan? Or you're actually focusing on the variable cost reduction?

No, fixed cost also, we are definitely looking at One of the things that one element would be an advertising sales promotion. That's something we have to look at many things I'm saying right up to even travel and travel policy, everything needs to be looked at. But if you were to look at it currently, it is lesser of a priority because the bigger tickets are being addressed at this point of time.

Got it. And last, in terms of your ad spend as well as the spending for all the -- having the promoters. What has been the increase -- a number of FY '26 versus FY '25 because I remember in the Q1 of Q2 call, you mentioned that we have actually recruited some people and you want to actually have nationalizing the salary structure of promoter -- I mean promoters and their incentives. I just want to understand those 2 things.

You actually look at it, I think we increased our number of e400-odd people at the store. So it doesn't mean that point-move outlets have come under the coverage because there are a lot of these key accounts, which has got multiple flows. And therefore, if I got x number of promoters, it doesn't mean that the same number of outlooks have been covered, certain outlets depending on the footfall and the coming on a number of floors might have multiple promoters okay. So absolute number-wise, it's increased by about 400 to 500 numbers. We intend to further take it because we are finding that dealers -- there are 2 things, one is if you put the resource at the right outlet, then you get the benefits out of it. And therefore, as I said, we have identified the outlets where we need to put them up. And we definitely want to increase the number of outlets, which are covered by this in-store promoters. The challenge is to ensure that we put them in the right outlets and we get the maximum. So all productivity and things have to be to be measured, and there's a program that is being done as far as that is concerned. [indiscernible] increase the number. We are predominantly a variable pay, there is a fixed component, but we would like to remediate our into promoters, mainly the variable component of it. And therefore, we just rolled out a new incentive policy burden, which should simplify their process of coming to founder how much were to simplify it to try to ensure that the premium is maintenance. So a lot of work is happening on the in-store promoters, increasing the numbers, incentivizing them properly, earning them profitably, ensuring that the [indiscernible] is being tracked and to cater

Last thing on the credit card tie-ups. One of the feedbacks which was there earlier was that our cash back or the tie-up of the credit card is not has scope of improvement and there was an action taken at an ear of the controls that we heard. I want to understand whether that particular thing has been fully addressed that you are actually tied up with all the credit cards so that the cash back, whatever it is at par with what our competitors give or there is still more action to be taken?

Yes, Kartik, here. Were good guess in terms of being available on most of the parts are now fixed. Today, our customer offer in terms of low cost of MI and the tenant be similar to the competition. And most of them are similar to the competition products are [indiscernible]

Yes. But to that, it is a cost of any cash tax that is here portion of that is a cost to us and therefore that's something that we have to be cautious about how we manage that.

Got it. And have you increased your ad spend? What are the ad spend at the entity to [indiscernible] .

So we have not really increased our agents. We have not -- it's more the same and that we are strengthening our digital portion of it because we believe that the good is a way forward. We have a large base of our own loyal customers. And therefore, rather than going through in the book, we believe that digital is a great way to reach out to these customers, whether it be a cross-sell or ops. And therefore, we are strengthening our digital to make it much more effective and we are communicating with our customers. At the same time, we are looking at plugging any legs that are all those elements of to ratios and all those things that we looked at, we're giving some external let to help us manage that. So is that something that we are doing now.

And in terms of the energy rating related to it, which is for product categories actually got affected and therefore, what is the cost escalation and second, in terms of fee-based program, is that a -- what is the kind of provision you are taking?

So energy was actually on the AC business effective from first of January, which is under new energy rating payment. It are 2 impacts. One is obviously the cost ramp-up to be able to maintain the same thing, the cost per machine did show up. And also as a company, we -- when the company when we when the market moved to a new energy rating -- we do not want to hold on to all energy rating products in the market, and therefore, we have to do a liquidate drive also. So it impacted us in 2 ways. One is the fact that the cost per unit has gone up. And to is temporarily, we have to ensure that we don't carry too much of the...

What is the that you can quantify because there has been some liquidation or discounting to have done any cost for the full year or for the fourth quarter on account of this?

I think it was about INR 7 crores was the impact because of that, INR 7 crores for the full year. And obviously, everything came into Q4. So about INR 6 crores out of that came into Q4.

Okay. And that's only for aircondition?

Correct for aircondition. That the first of January is on the new energy rating came in, and therefore, all the costs come in to [indiscernible]

Ladies and gentlemen, in the interest of time, that was the last question for today. I now hand the conference over to Mr. Ratanarak for any closing comments.

Sabisa, do you want to have any closing remarks, sir?

So I think having this instruction is the first time that I'm doing this in traction on behalf of IFB. I'm very glad to be able to answer the question show a genuine interest of our investors in our business, and we are thankful to that. I hope we have given you enough confidence that [indiscernible] we've expected to do that well and you see a boring in the market, and we should get capitalized on that. And we are only glad that I'm asking us the point on key looking from our to. So thank you very much, and it's been a pleasure in fact in the [indiscernible]

Thank you. On behalf of Nirmal Bang Securities Private Limited, that concludes this conference. Thank you for joining us, and you may now disconnect your lines. Thank you.