JSW Steel Limited (500228) Earnings Call Transcript & Summary

Ladies and gentlemen, good day, and welcome to the JSW Steel Q3 FY '26 Earnings Conference Call. [Operator Instructions] Please note that this conference is being recorded. I now hand the conference over to Mr. Ashwin Bajaj, Group Head of Investor Relations. Thank you, and over to you, sir.

Yes. Thank you very much, operator. So good evening, ladies and gentlemen. Welcome to JSW Steel's Earnings Call for Q3 of FY 2026. We have with us today the management team represented by Mr. Jayant Acharya, Joint MD and CEO; Mr. G. S. Rathore, Chief Operating Officer; Mr. Arun Maheshwari, Director of Commercial and Marketing; and Mr. Swayam Saurabh, the CFO. We will start with opening remarks by Mr. Acharya and then open the floor to questions. So with that, over to you, Mr. Acharya.

Yes. So good evening, everyone. Let me begin by talking a little bit on our strategy. JSW Steel has adopted a prudent strategy over the past years and has created significant value for our shareholders -- actually for all our stakeholders. On 3rd December, the company announced a strategic joint venture with JFE Steel Japan for its BPSL Steel business. With this transaction, JFE will take a stake of 50% in BPSL Steel business at an equity value of INR 31,500 crores and an enterprise value of INR 53,000 crores. This transaction will enable a cash flow of INR 32,000 crores and a substantial deleveraging of about INR 37,000 crores for JSW Steel. This partnership allows us to grow the BPSL business with our project expertise and operational excellence and bring in the JFE technological expertise to be able to produce a variety of value-added products. It will also allow JSW Steel to accelerate the growth across its portfolio of assets in a financially prudent manner to meet the demand growth in India. Today, the Board has approved a 5 million tonne steel plant at our new site in Jagatsinghpur, Odisha. The project will be housed in our subsidiary, JSW Utkal Limited, and will entail a CapEx of INR 31,600 crores, with commissioning by FY '30. This project is the first phase with expansion project potential to go to 13.2 million tonnes. We already had commenced setting up 2 8 million tonne pellet plants, you will recall at this site and a 30 million tonne slurry pipeline is under construction by JSW Infra, which will transfer the iron ore from the mines to the plant. This is a port-based facility with our own captive jetty and coupled with the iron ore through the slurry pipeline, this is an extremely efficient location in terms of our overall logistics cost. Together, these milestones significantly accelerate our capacity growth plans. We are well on track to reach 50 million tonne in India by FY '31 other than the BPSL business. With India steel demand rising rapidly, these strategic steps put JSW in a very strong position to grow responsibly and sustainably in the years ahead. On the macroeconomic front, you would have seen the IMF has given an outlook of about 3.3% growth in 2026 and kept its outlook the same for 2027. The resilience in the global economy in spite of the ongoing uncertainties is a mention which IMF has given in their commentary. The momentum is being supported by strong tailwinds from AI and technology investments. Growth is also getting a further lift from supportive policies and easing conditions. With advanced GDP estimates in India pegging the growth at about 7.4%, we remain the world's fastest-growing major economy. While global headwinds persist, the Indian government has provided various policy support measures and policy reforms. Alongside the recent trade agreements, this bodes well for our medium-term prospects. We are seeing a strong post-GST momentum in consumption, further aided by income tax cuts and benign inflation. Rural indicators remain positive, driving strong tractors and 2-wheeler sales. Central government CapEx, while was low in October, November, but is up 28% April to November due to a strong H1. The annual CapEx target looks to be on track. While residential sales have remained somewhat soft, the commercial real estate shows a robust movement. Conditions for private CapEx is increasingly becoming conducive, supported by a healthy balance sheet and RBI's recent rate cuts and lower inflation. India's steel consumption continued to grow with a 9-month growth of about 7%, though Q3 was lower at 4.6%. However, the December demand on absolute number was about 14.5 million tonnes. And the demand in the quarter 4 on a seasonally strong demand and restocking looks good for volumes in the quarter ahead. Looking ahead for the year FY '27, the demand is projected to grow in the range of 7% to 9%. On the policy front, the government has taken steps to arrest unfair trade by imposing antidumping duties on hot-rolled coils from Vietnam in November and CRNO from China in December. And a safeguard duty has been finalized in December '25. This will enable the local domestic industry to get a level playing field in India. In China, the steel production was down 4.4% Y-o-Y in CY '25, a decline of about close to 44 million tonnes. However, their exports, including semi-finished steel surged 14% to 133.5 million tonnes, primarily due to a weak domestic consumption. The elevated exports kept Asian prices subdued in 2025. Looking ahead, the anti-involution measures, which have been taken up by the Chinese government, export licensing and some production moderation, which we see should help support the regional prices in Asia. Moving to sustainability. JSW Steel, I'm happy to mention, was ranked #1 in the global steel sector in the S&P Global Corporate Sustainability Assessment and continues to remain a part of the Dow Jones Sustainability Index. Our focus on energy efficiency was also recognized at the 35th National Energy Conservation Awards 2025, where our Dolvi unit was awarded India's best-performing unit by the President of India, and BPSL received a certificate of merit. We continue to progress on energy transition with 1 gigawatt of renewable capacity commissioned. We have already got the approval for 2.5 gigawatt generation and a 320-megawatt hour of battery storage, which is in various stages of construction. On the technology front, we commissioned India's first diesel to battery converted locomotive at Vijayanagar. These initiatives underscore our commitment to sustainability across our operations. On the digital front, JSW has deployed AI-based vision systems that monitor conveyors, center flames, flare stacks and equipment in real time to improve yield, efficiency and reliability. These digital solutions are delivering substantial impact through cost savings, reduced emissions and preventions of over 1,000 safety incidents. This system is deployable across multiple locations and with additional use cases, we see the potential to save INR 100 crores per annum. On the projects front, apart from the Board approval for our new plant in Odisha, let me briefly update you on the other projects. At JVML Vijayanagar, we reached a key operational milestone as the 5 million tonne plant is now fully ramped up. The 1.5 million tonne BF-3 upgradation at Vijayanagar remains on track for commissioning by the end of quarter 4 FY '26. At Dolvi, the phase 3 expansion from 10 million to 15 million is progressing as planned, with completion expected by September 2027. Technical and commercial discussions for equipment is underway for the 1 million tonne electric arc furnace and structural mill announced for Kadapa last quarter. Our value-added product capacity across Vijayanagar, Khopoli and Raigarh are progressing steadily. The Board has today approved 0.2 million tonne tinplate capacity and 0.36 million tonne capacity for GI and GL lines at our downstream units in Rajpura. Together, these value-added expansions will add about 4 million tonnes of flats and longs, complementing our steelmaking operations. This reinforces our long-term growth strategy and strengthens our competitive position as it adds to our value-added product portfolio. Strengthening our raw material security has been one of our key strategic priorities. We have 23 iron ore mines, which we have mentioned earlier, out of which 12 have been operating. During the quarter 3, we have commenced the production from the 0.5 million tonne Cudnem mine in Goa, taking the total number of operational mines to 13. Once our mines are operationalized, coupled with some enhancements of existing capacities, we expect to produce about 50 million tonnes per annum, which will cover around 50% of our total iron ore requirement by FY '31. On the coking coal front, we have secured 3 mines and coal linkages in India and taken a stake of 30% in the Illawarra coking coal PLV mine in Australia, which together will provide us about 5 million tonnes of coking coal. This will meet around 25% of our total coking coal requirement in FY '31. Additionally, we are in the process of acquiring the Mozambique MDR high-grade coking coal deposit. This transaction is expected to be closed in quarter 4 of this calendar year by March. So therefore, the raw material side, we are strengthening both from iron ore and coking coal perspective. Moving to our operational performance. We reported a strong operational performance among -- amid the ongoing uncertainties. Our consolidated crude steel production stood at 7.48 million tonnes, up 6% Y-o-Y for the quarter. Our Indian operations delivered a production volume of 7.28 million tonnes, up 7% Y-o-Y. Production was down sequentially due to the blast furnace 3 at Vijayanagar being under shutdown for the capacity enhancement. Utilization of our Indian operations stood approximately at 93%, excluding the BF-3. What it underlines is the consistency in the capacity utilization at JSW Steel across locations. We have been more or less at 90% or above across quarters. During quarter 3, we achieved our best-ever sales, both from a consolidated as well as an Indian operation point of view, increasing by 14% Y-o-Y. This was mainly driven by the volumes from JVML plant ramp-up to its full capacity. Our domestic sales rose by 10% Y-o-Y in quarter 3 and 12% in the first 9 months, well ahead of India's consumption growth. This has enabled us to increase our market share. We have also liquidated 0.3 million tonnes of inventory during the quarter. The other positive is that the value-added product sales were the highest ever at 4.54 million tonnes, growing 16% Y-o-Y and forming about 61% of our total volumes, including JVML. The deliveries to the auto and renewable sectors were also at all-time highs. If you look at our financial results, the consolidated revenue stood at INR 45,991 crores, with adjusted EBITDA of INR 6,620 crores. The EBITDA per tonne was close to INR 8,700 and a margin of 14.4%. The reported EBITDA for the quarter stands at INR 6,496 crores. During the quarter, steel prices were at a multiyear low and adversely impacted realizations. Coking coal costs were higher by $1.05 in line with our guidance, while iron ore provided a slight cost benefit due to better blends. While margins were negatively impacted during the quarter, we were able to mitigate the drop in prices through a better value-added product mix and cost efficiencies. Our Indian operations delivered a total adjusted EBITDA of INR 6,522 crores and EBITDA per tonne of close to INR 8,800 per tonne, with a margin of 15%. This was enabled by strong growth in domestic sales and better value-added product mix. The U.S. operations delivered EBITDA -- operating EBITDA of $3.1 million, which was lower, primarily driven by lower volumes due to the plant shutdown at Ohio for the caster upgradation project and lower NSR for the plates. For the 9-month of FY '26, U.S. operations have reported an EBITDA of $36 million, a substantial improvement versus an EBITDA loss of $32 million last year. Italian operations delivered an EBITDA of $5.3 million during the quarter. During the quarter, the total EBITDA for our overseas operations was at INR 122 crores. Unrealized ForEx losses stood at INR 124 crores, which impacted the overall profitability during the quarter. With the enactment of the new labor code, the required changes in employee benefits have had a onetime impact of INR 529 crores, which has been shown as an exceptional item in the profit and loss account. The consolidated PAT stood at INR 2,410 crores compared to INR 719 crores in quarter 3 of last year. This profit in quarter 3 is after recognizing net deferred tax assets of INR 1,439 crores related to the slump sale of BPSL Steel business undertaking. Net debt was at INR 80,347 crores, and our debt ratios improved versus the last quarter. Net debt-to-EBITDA stood at 2.91 and net debt to equity at 0.92. Our weighted average interest cost improved to 6.51% in the quarter, an improvement of approximately 60 bps if you were to compare with last year. Our revenue acceptances stood at $2.36 billion. Our CapEx spend during the quarter was roughly about INR 3,500 crores and total for 9 months stood at INR 10,000 crores. For the FY '26, we expect the total CapEx to be in the range of INR 15,000 crores to INR 16,000 crores. The JSW One platform has been doing well, has seen a significant uptick in volumes, especially in steel, which grew by 43% Y-o-Y. Quarter 3 was strong with a GMV of INR 4,544 crores, representing a solid 36% jump Y-o-Y. Over INR 1,300 crores of that GMV was driven by JSW One's credit offerings. With these results, we have achieved over 74% of our total consolidated volume guidance for both production and sales for the FY '26 and we expect to broadly achieve our full year guidance of 30.5 million tonne for production and 29.2 million tonne for sales. To conclude, we continue to monitor Chinese steel exports and are cautiously optimistic that measures such as export licensing and anti-involution policy should provide some support to the regional prices. India's growth prospects remain strong with the government's recent reform measures providing further impetus to consumption and private CapEx on the back of rising capacity utilization of companies. The upcoming Union Budget is expected to continue to see the government focus on reforms as well as public CapEx. All this bodes well for the steel demand growth and the trade measures announced by the Government of India is most welcome and will help keep unfair imports in check. Looking ahead, steel prices have begun to recover in end December and have continued an uptrend in January. Quarter 4 margins should be better on the back of higher steel prices, supported by seasonally strong demand, which is expected to offset the impact of higher raw material prices, especially coking coal. We expect the coking coal cost to increase between $15 to $20, while iron ore prices are expected to be range bound. We expect a strong quarter 4 volumes from JSW Steel due to a healthy demand in this quarter. And for the next year, we see a steel demand growth of 7% to 9% for the FY '27. We'll be happy to take questions which you may have. Thank you.

[Operator Instructions] Our first question comes from the line of Sumangal Nevatia from Kotak Securities.

Congratulations on the new expansion announcement. So first question is the bookkeeping one. If you could just highlight what is the steel price increase we are seeing in the last 3 or 4 weeks. And as far as time line is concerned, what is the update on the slurry pipeline and the JFE Bhushan deal closure time line?

Yes. So the prices of steel have started moving -- have started recovering from the multiyear lows in the last quarter. In the end of December, we saw prices moving for flat steel by about roughly INR 1,500 per tonne. In the beginning of January, it has moved by about INR 2,000 per tonne. We see some recovery possibility during this quarter as we move ahead. The second question on the slurry pipeline, which you have asked is expected to be somewhere in the quarter 4 of 2027 -- FY '27. On the BPSL, I'll request Swayam to give an update on the BPSL asset.

So on the BPSL asset, we are pretty much on track versus the time line we had indicated. Earlier this week, we received Competition Commission's approval for the joint venture. We are right now in the process of obtaining shareholders' approval, which we expect to get by first week of February. As indicated, we should see slump sale getting concluded before end of this year, which is before end of the March, and that should translate into about INR 24,400 crores of effective cash coming in JSW Steel and our net leverage reduction of about INR 29,000 crores. The second leg also remains on track, but that is expected end of quarter 1 of FY '27.

Which will be an additional...

Additional INR 7,800 crores.

INR 7,875 crores, yes.

Yes. Got it. I have one more question, and that's slightly on a medium- to long-term strategy. So if we look at our expansion FY '30, we would reach somewhere around 47 million tonnes in India and we'll be adding capacity only at the rate of around 7% to 8% CAGR. Now given the Bhushan divestment, our balance sheet would be quite deleveraged potentially around 1.5x net debt to EBITDA. So does that -- does it make sense to evaluate the other brownfield expansion opportunities parallelly? Or should we now just expect this expansion till '30 and then maybe evaluate sometime closer to FY '28, '29 as the next expansion plan?

If you see the presentation, which we have given for this quarter, we have given you an indication of the expansions likely by FY '31, which takes it to about 56 million tonnes by FY '31, which includes 1.5 million tonnes of Ohio and 4.5 million tonnes of the BPSL asset. So we have moved up with respect to our earlier goal of 50 million tonnes in India by the end of this decade. So I think that, I would say, the combination of the value unlock in BPSL certainly enables us, as you rightly said, to expand faster, which we are doing. We have taken the Orissa project. We are doing a project in North of India for tinplate and substrate for GI and GL. And we will be able to fast track our other brownfield expansions as we go along into this decade. So we are on track. I think we would be adding capacities in line to meet the India demand.

And sir, can I get your thoughts on...

Sorry to interrupt, sir. We request you to please rejoin the queue if you have any further questions. Our next question comes from the line of Jashandeep Chadha from Nomura.

Am I audible?

Yes, you are audible, sir.

Sir, my first question is on the lines of you are expecting 7% to 9% Y-o-Y volume growth or apparent steel consumption growth. Just wanted to understand if we go one step deeper, from which segments are you expecting majority or which segments will lead this demand? We understand that the GDP is growing and overall steel consumption will go up. But specific to JSW, internally also, which segment do you believe will lead that growth? Is it the autos, industrial, retail, I mean, or even any other segment that you see? Just wanted to get your view on how the demand will be going ahead?

So we are seeing the growth across sectors. If you were to really look at the India story now, I think you'll see the growth across your construction and infrastructure, you see good growth in the commercial real estate. We are seeing good growth in industrial and now post the GST announcement, especially in the consumption side, automotive appliances, the other area is the renewable energy. And I think you -- by and large, I think we are seeing it across sectors.

Understood, sir. Sir, my related question to this will be, has the intensity of flat products in construction, retail, real estate sector, has it gone up in the last couple of years? And along with that, I just wanted to understand also the new capacity that you have announced, what will be the CapEx intensity of that and the product mix, if you can?

The new capacity, which we have announced will be flat steel. It will be a 5 million tonne facility with a hot strip mill and steel-melting capability and blast furnace. The steel-melting capability will be for roughly about 6.5 million to 7 million tonnes. It has potential to grow. So the hot strip mill can ultimately be expanded once the second blast furnace is taken up to 6 million tonnes itself. Your second question about the intensity of flat steel in construction. The intensity of flat steel in construction has been increasing gradually. Globally, flat steel is used in construction through steel-based plated constructions. And we are seeing that slowly catch up in India. Now steel buildings or steel and glass buildings are coming up in India. They are safer. They are faster to construct and unlocks value in terms of time. So it is catching up, although at a slower pace than internationally. But we are looking at this space, improving the flat steel consumption in the construction and the infrastructure. Infrastructure, also the bridges, which are coming up, are also adding to the flat steel consumption. People are now looking at steel columns, steel supporting infrastructure for the bridges because it is able to finish the bridge faster. So yes, it is going up in terms of intensity.

And also, if you can tell me the CapEx for the new capacity, sorry, if I missed it.

INR 31,600 crores. This is also building in some of the infrastructure for the expansion of the second phase.

Understood. So the next phase of expansion will be at a lower intensity per tonne?

Correct.

Our next question is from the line of Rahul Gupta from Morgan Stanley.

So my first question is, given strong volumes during the quarter as well, now your domestic volume guidance of 28.2 million tonne would imply flat volumes on a year-on-year basis for 4Q. Now how should we look at your 4Q volumes with respect to that? Would you revise your sales guidance? That's my number one question.

So I think from a sales guidance point of view, we are maintaining our guidance of 29.2 million tonnes, production guidance also at 30.5 million tonne is more or less on track. Going forward, in the next year, as the BF-3 capacity unlock happens, we will be able to add to our available capacities and that would further increase the sales from all our assets.

Okay. So am I reading it right that your India volumes would be flat, assuming you don't change your guidance?

Why do you say flat?

On year-on-year basis.

Okay. So the inventory liquidation, probably you're not counting. So the potential -- so we did an unlock of inventory of 300,000 tonnes in the last quarter. In the current quarter also, we have...

No, I meant for fourth quarter. So if I look at the fourth quarter...

I'm looking at the fourth quarter. I'm saying we liquidated inventory in quarter 3. We are looking at some inventory liquidation in quarter 4 as well. So from a guidance perspective, we had a sales of 7.64 million tonne last quarter. Our guidance is that we will be able to meet 29.2 million tonnes. So maybe similar with respect to quarter 3, quarter 4, if that's what you're asking. From an Indian operations point of view, we will be slightly higher. But on an overall basis, it will not be very different.

Got it. Got it. Now if I look at the detailed CapEx table that you have shared on Slide 39, can you help us break down the mining CapEx and also value-added CapEx a bit further? Thanks for highlighting Mozambique and the downstream CapEx separately, but can you help us with more details, what all come into this?

I think the details, the investor team can explain, but you're talking about the capacity -- consolidated capacity update, right? That's what we have given you in that slide.

It's the CapEx guidance for the next 5 years, the amount of CapEx. But yes, okay, I'll get that offline.

What we are -- yes, what we are trying to say is that we will be spending this INR 100,000 crores over the next 4 to 5 years. We will give you the breakup year-wise in our annual board results in May. But roughly 4 to 5 years, you can spread it equally, it will be a little higher in the next year -- next 2 years and then slowly go down.

So I was actually looking for breakdown of mining and value-added, but I can take that offline. One final question. If we look at realizations, on a reported basis, Q-on-Q, it has been much better. Now adjusted for JVML, did share of value-added products improve quarter-on-quarter? Or am I missing anything over here?

So we have been reporting in the last few quarters, we have been giving you the value-added numbers without the JVML. This time, including JVML, the value-added product mix is 61%. Excluding JVML, it is 67%.

Our next question is from the line of Amit Murarka from Axis Capital.

So firstly, a bookkeeping question. In the quarter, what was iron ore sales that you made?

Just one second.

What's your other question? Maybe we answer that first while we get...

It is about 0.13 million tonne.

Okay. And what was it in the last quarter? Why I'm asking that is because like the revenues doesn't seem to have gone down in terms of the realization decline that was expected.

Indeed. So you are seeing the stand-alone numbers, right?

Yes, yes, I'm looking at the stand-alone number.

Yes. So we'll give you this input offline. It's primarily iron ore sales.

In Q3, you mean?

Yes.

Okay, sure. And also, when I look at JVML numbers, again, over there, the realization seems to have been down. So is it like some sale of some semis that has happened over there? Like what is really the reason?

No, basically, see, we look at JVML and Vijayanagar from an operations point of view as a combined decision-making process. We have certain advantages in JVML on the cost side. We have some advantages in JVML on the state tax side. So we have a state tax advantage even if you sell outside the state. So therefore, outside state movement like to North, we prefer to do from there, which is a higher freight incidence. And therefore, you see a lower realization, but that enables us to overall optimize our total Vijayanagar blend because the other units is able to supply to Karnataka, which has got a tax advantage in Karnataka. JVML is able to leverage the sales to other locations where we get the tax advantage.

Okay. Okay. Understood. And just also...

Amit, sorry to interrupt. May we request you to please rejoin the queue for further questions. Our next question comes from the line of Vikash Singh from ICICI Securities.

Sir, just wanted to understand our stance on the CBAM. What is our exposure currently on the European side? And any strategies which we are going to tackle in terms of the -- whatever exports which we are doing to the Europe?

I'm Arun Maheshwari. Per se, CBAM has impacted overall the entire exports happening to Europe. So it is not that it's impacting as JSW alone or India alone. However, the impact is not...

Pardon me. Sorry to interrupt, sir. May we request you to please come a little closer to the mic when you're speaking, sir?

Yes. Sorry. It's better now?

Yes, this is better. Please go ahead.

So I would say that the CBAM impact is not in particular for India or JSW. It has been impacting all the exporters who have been doing to Europe. The overall real-time impact assessment is still yet to come out because it's still very new, people are still understanding the impact. However, I would say our export has been quite sizable component has been into Europe. But the way -- because if the impact is to overall European exporters, then it will find its own way how to export it out over there. So I don't think that it will be having a bigger impact on us as a company.

Any figures which you wouldn't like to put in terms of exposure in terms of tonnage, annual basis?

Not really so. See, basically, we have been doing somewhere around 1.2 million, 1.3 million tonne kind of exports into Europe. But the way the markets are shaping up in other geographies also, probably we can consume our tonnages over there. At the same time, India market is also growing much faster. So if you see year-on-year, our export component in the overall sales has been dropping. So I don't see that this will have a major impact on our sales volume into exports.

So from a percentage point of view, just to answer your question, Europe as a percentage of our total exports is going down. Asia, Middle East, other countries are picking up. So therefore, some part is already getting mitigated. We will understand the guidelines fully as and when they come, and we'll be able to give you maybe some more color as we go along. But some readjustment in the prices in Europe also is something which will take place. So let us understand the market once the full guidelines play out.

Sir, my second question pertains to our CapEx plan in Odisha. The INR 6,300 crore per million tonne for a greenfield plant seems to be pretty low. So what -- actually, this is at some of the brownfield plant probably is expanding more than that. So what differential things we are doing in this or there is a scope or a risk of further enhancing this CapEx as we progress?

So first of all, I would just like to say that from a CapEx point of view, if you see our Dolvi plant expansion, which we have just undertaken, which is on, is actually specific investment is even lower than this. This is slightly higher because of being a green plant. The other reason is that we are doing this plant in a modular fashion. So we already had announced the pellet plant and some enabling infrastructure before that. That is something which is happening parallelly. But even then, if you look at the plant, once this INR 31,600 crores also includes some enabling infrastructure for phase 2 expansion. So when you look at a 10 million tonne expansion, including the next phase, I think our CapEx cost will be further competitive, if you were to compare with others. How we are able to do it, I think over time, that's the project expertise which JSW has developed. And we are able to do specific investment costs lower over time.

So there is no risk of overrunning in this CapEx as of now?

We don't see so.

Our next question comes from the line of Parthiv Jhonsa from Anand Rathi.

I hope I'm audible. So my first question is pertaining to the CapEx. You have mark almost about INR 1 lakh crore in the next 4 to 5 years, coupled with this INR 80,000 crores kind of net debt. And as mentioned earlier on the call, you expect the CapEx to be high in the first couple of years. Do you think that this will load your balance sheet despite receiving the money from BPSL?

No. We do not think it will load our balance sheet. I think from a ratio point of view, we will remain financially prudent while we invest. And from our perspective, I think we are quite well placed to be able to manage these expansions while we keep our ratios in control. You will see the additional volume from BF-3, the full ramp-up of JVML, the new capacities from Dolvi, which will come in, in phase 3. All these will generate additional cash flows which will contribute to the internal accruals, which we'll be able to spend for the CapEx. So from that perspective, we are fine. We don't see any challenge.

No, we definitely do agree that...

Just to add to this, BPSL transaction, once it's concluded, would also add significant new cash, which you have to take into account while plotting the numbers.