Kaveri Seed Company Limited (KSCL) Earnings Call Transcript & Summary

Ladies and gentlemen, good day and welcome to the Kaveri Seed Company Limited Q3 and 9 Months FY '20 Earnings Conference call. [Operator Instructions] Please note that this conference is being recorded. I would now like to hand the conference over to Mr. Rishab Barar from CDR India. Thank you, and over to you, sir.

Good afternoon, everyone, and thank you for joining us on Kaveri Seed Company Limited's Conference Call. We are joined today by Mr. Mithun Chand, the Executive Director. Before we get started, I would like to point out that certain statements made or discussed on the conference call today may be forward-looking in nature and must be viewed in conjunction with the risks we face. The company does not undertake to update them. A statement in this regard is available for reference in the presentation. We will begin the call with opening remarks from Mr. Mithun Chand, who will share updates on the market environment and take you through the strategic imperatives of the company. He will also share his thoughts on the performance of the company during the review period. We will then have the forum open for an interactive question-and-answer session. Now I would like to invite Mr. Mithun Chand to share his views. Over to you, sir.

Good day. Thanks, Rishab. Good day, everyone, and a very warm welcome to all of you. The first 9 months I have seen a good performance and strong revenue growth by about almost 15%. And on a quarter 3 financial year '20, the growth was 46.53%. The operating EBITDA margins, excluding other income, stood at 6.82% in quarter 3 '20 versus 0.18% in quarter 3 '19. Operating EBITDA growth for 9 months has also been noticeable and stands at 18.8%. On a consolidated basis, revenue has grown 43.91% in quarter 3 financial year '20 and 14.70% in 9 months '20. Operating EBITDA margin stands at 8.5% compared to a loss in quarter 3 previously. In 9 months for the present year, operating consolidated EBITDA growth stood at 22.1%. Margins were 30.6% for 9 months of '20 compared to 28.78% compared to the previous year 9 months of '19. Coming to the crops, we have witnessed the increase in acreages of cotton over last year. All other crops, including maize, rice, jowar and bajras have shown some increase in acreages. A little details in our main crops of cotton and maize. Overall, the cotton market has remained stable. The rabi, maize area has gone up in some states like Andhra Pradesh, Telangana, Bihar, Maharashtra and Karnataka. This is mainly due to good rains and better commodity prices. Where our crop-wise performance is concerned, cotton volumes increased by about 18% in the first 9 months, contribution of new products went up from 14% to 22% of volume. Money Maker was up across the market this year. Two new cotton hybrids are under demonstrations with farmers. Performance of Money Maker was appreciated by farmers across markets. Though maize volume is down by 3% in the first 9 months, the revenue was up 12%, which was due to product mix and price gain. Noncotton business has grown significantly by about 16%. It has been driven by volume growth in new hybrids and also price appreciation in three products. Hybrid rice volumes increased by 57% in the first 9 months. Introduction of new hybrid paddy 468 has helped translate to strong growth. In selection rice, there has been consistent performance across geographies. In Q3 financial year '20, revenue stood at INR 98.44 crores, as against INR 67.18 crores in quarter 3 '19, a growth of 46.53%. We had a strong operational performance. The operating EBITDA margins stood at 6.82% in financial year '20 versus 0.18% in financial year '19. The other income component was low compared to previous corresponding quarters. In quarter 3 financial year '20, the EBITDA, including other income, stood at INR 14.43 crores as against INR 10.71 crores in quarter 3 '19. In quarter 3 '19, PAT was at INR 3.64 crores. In quarter 3 financial year '20, PAT was at INR 6.04 crores. In 9 months financial year '20, revenue stood at INR 931.33 crores as against INR 724.26 crores in the 9 months corresponding to previous year, a growth of 14.78%. The other income component was lower compared to previous 9 months. In 9 months '20, the EBITDA, including other income, stood at INR 266.32 crores as against INR 251.99 crores in 9 months financial year '19. In 9 months financial year '19, PAT was at INR 226.16 crores. In 9 months financial year '20, PAT stood at INR 241.91 crores. The balance sheet continues to remain strong. Total cash on books as on December 31, 2019, is INR 413 crores and as against INR 462 crores as on March 31, 2019, and INR 389 crores as on December 31, 2018. We are happy with the way things are moving forward. We feel that commodity prices will continue to remain higher now, keeping the farmer sentiment happy. We would like to add that our continuous focus on research, we continue to innovate and develop new products for crops. Our outlook for vegetables like hybrid tomato, hot pepper, bitter gourd are positive. On that note, I conclude my opening remarks. We would be happy to give our perspective on any questions that you may have. I would request the operator on this call to open question-and-answer session. Thank you.

[Operator Instructions] We take the first question from the line of Viraj Kacharia from Securities Investment Management.

Congratulations for a good set of numbers. Hello?

Yes. Go on.

Just had a couple of...

Sir, this is the operator, I'm sorry to interrupt. Requesting you to please speak a bit louder, sir. Your audio is not very audible.

Yes. Is it better now?

Yes. Please go ahead.

Yes. So basically, I had a couple of questions on rice and maize. Starting with maize, just trying to get some idea of how the industry would have grown, say, in Q3 or that's in first 9 months, both in terms of the volume and price, if you can provide some color on that? And second, where is the growth coming for the industry? Is it largely in our core markets? Because we have been introducing new products for quite some time. And even in the first 9 months, we have seen a good acreage increase in our core markets, but somehow the volume performance for us has been quite muted. So just trying to understand where is the difference?

So if you take -- you have asked for the 2 crops, basically rice and maize. If you take rice, as an industry, it has gone up by 7%, 8% in terms of the hybrid rice market, and not in terms of the acreages, but in terms of hybrid rice market, it has gone up by 7%, 8%. Whereas, as a company, Kaveri, we have grown by more than 65% in hybrid rice. So that's a very good growth. We have increased our market share. Basically, the hybrids are performing well. And going forward, also, we have introduced 2 more hybrids in 2 more segments, which is in demonstration level, and we are pretty confident that beating more than the market -- more than the growth of the industry is quite possible with us with the pipeline in hybrids and present set of hybrids. Coming back to maize, yes, the maize acreages has increased this year, basically in the second half when compared to the first half as the monsoon was good and then the rabi acreages have come up very well. Even though it looks like we are down by 3% in terms of the volumes, but in fact, we have reduced our government business. Compared to previous year, we had reduced our government business by more than 60%. I mean to say the government businesses is like we participate in some tenders, which is a onetime fee. And this time, we have not participated cautiously because we were not having those type of inventories to participate in it. So if you take the normal trade market in the areas where we operate leaving the government business but we have increased our market shares. And most importantly, we have increased our market shares in areas like Maharashtra, Bihar, parts of U.P. and the other part where we are not strong. That's the reason you see the increase in the -- you'll see a change in the product mix. And the other important point to notice is that, like, we have increased our revenue by 12%, even we are down by 3%. That's where we have seen the entire margin shifts.

So for maize. Just 2 follow-ups. For maize, is the effect of government business completely out now? Or do you still have some government business? And how big is the government tender market typically?

No. It's a big market, but that all depends on the company whether to participate in it or not. Because that's not a continuous business, that's a onetime business. Sometimes you get a couple of years or 3 years based on your terms and your offerings, but this time, we thought that we'll not go. And it's a low-margin business, actually, when compared to the local market. And we'll -- as a company, we take a call in the season based on our inventory, based on the size.

Okay. How would the industry would have grown in maize, into the price...

Industry should have been -- overall, the acreages -- by seeing the acreages and the industry, it should have gone between 8% to 10%.

Overall, value terms?

Not value terms, in terms of the volumes. Value that -- we don't track value assets, we track volume because most of them -- it is a mix of those 2 things.

Okay. And on rice, you said that we have got a good traction for the new launch, the new hybrid variety we launched. So how does it differentiate the value proposition versus existing offerings vis-à-vis ours or other market offerings? And which target states where we're kind of gaining this traction?

So in terms of the rice, basically, when you have been the -- hybrid is gaining its market shares. It clearly shows that we are ahead of the existing hybrids, basically they measure through yeast. So we have one of the best-performing hybrids there. That's the reason we're increasing market shares. I mean if you take the entire hybrid market, basically, the hybrid market is in there with U.P., Jharkhand, Chhattisgarh. These are the markets where most of hybrid markets are -- hybrid rice markets are concentrated. And we are having the market shares in those areas. Even though we are selling in all of the parts, but these are the major areas which contributed to majority of the hybrid rice markets.

Okay. So has there been any further progress in terms of new launches in tapping the Punjab or Haryana market, either by us or any other players in the industry?

Research is a continuous activity. We always launch new hybrids in different segments and where we are not present. And we try to improvise our own hybrids for -- to increase the yield in the segments where we operate. But like, for example, like Punjab or Andhra, we are still trying it, but these are much matured markets. But if you take out the other markets making these 2 markets, there are 3 new markets to grow. If you take overall hybrid rice, only 3 million to 3.5 million hectares is hybrid out of 44 million hectares. So there is a huge scope to grow. We are working on that company, not only Kaveri, entire industry is working in that segment, and that's the reason we see a decent growth in hybrid rice market. And we are -- and I think the growth will continue going forward.

[Operator Instructions] We take the next question from the line of Viraj Kacharia from Securities Investment Management.

So, on rice, just to follow-up, this new variety, which has given -- which we have seen a good traction. Basically, I tried to ask earlier as well, I'm just trying to understand where is the value proposition? What we -- what the product does differently than the other existing offerings?

Basically, it all -- when you're talking about the product, they measure in terms of the yield. In terms of the yield it needs to withstand the present conditions, sometimes it needs to be disease resistant or drought tolerant -- I mean, that's not exactly a drought tolerant and maybe it should be a drought tolerant. Whereas, we're by withstanding the conditions by the disease resistant, and you need to get more yields. Basically, in the present conditions, if one of the -- if some of the hybrid is performing better than the existing one, then the farmer prefers to go for the hybrid which is giving a more yield. In our case, in those segments, our hybrid is really doing well. That's the reason that farmers are adopting it.

Okay. And even the 2 new hybrids, which you talked about this -- they also primarily targeted towards the existing hybrid markets, right, the U.P., Bihar and underlying...

Existing hybrid markets, but there are different segments. I mean to say, different segments in the sense, their value maturity, media maturity, late maturity, slender, bold. There are different segments in that. So the new hybrid what we are launching are not from the same segment. They are from the different segment.

Okay. Got it, got it, got it. And for maize, just had 2 more questions there. So what we understand, typically, the rabi or the spring is the area where we have a gap in the portfolio. So now how would our market share been now?

Because -- I don't think it will change significantly. But yes, to some extent, if you see the contribution from quarter 3 compared to last year, it has gone by more than 45%, 50%. But we need to understand the fact that the first quarter will be a major quarter, as it's a -- most of the India is under rain-fed conditions and most of the cotton crop comes in the first quarter itself. So that dominance will be there. But if you divide -- if you take out cotton and if you only compare maize, the maize contribution in the first half or you can say the first quarter to second, third to fourth -- first half to second half, it will be -- it can be comparable.

Yes. So basically, that's what my question was. I can see the whole idea is that we are trying to move -- trying to also build a noncotton portfolio and these rices are one of the 4 pillars of this.

And even the vegetables. Even -- if you see the vegetables also we are growing. Vegetables is round the year that basically comes from quarter 3 and quarter 4.

Yes. So hence, I was just trying to understand because, traditionally, what we understand, when you say rabi or spring maize, the MNCs are the ones who typically have a very strong hold on those markets. And in the past, various players, including us, have tried to launch, but there's been very limited gains in terms of market share. So just trying to get a flavor in terms of how is the traction begin actually?

So that's very much visible in the sales this year. Basically, if you recollect our calls in the last 3 or 4 years, we are always saying that we are targeting in newer markets where we are launching the hybrids. That hybrids is -- the growth in those hybrids, which we've launched in the last 2 to 3 seasons is actually reflecting now, and we further feel that there is a huge scope to grow in those areas because hybrids are doing well. As rightly said, these are all dominated by some of the MNCs. And if you say, we are the only company in India who are giving -- we are competing with the MNCs in these crops, and that's how we stand differently from the other companies -- other domestic companies. And as a company, we are basically focusing on the south conditions, basically in the rain-fed conditions. In the last 7, 8 years, we have started focusing not more -- a little more than 7, 8 years, close to, I can say, 10 years, we've started focusing on the rabi in these market. Now slowly, we are getting hybrids in those markets. As you know, it's very difficult to get a launch in the first go. So we took some time to get the gains in this market. And now we are pretty confident by seeing the pipeline and by seeing the existing hybrids that we'll grow. For example, like we said, like we are launching some hybrids in spring market, which we have never done earlier, even though we are strong, we have never done -- we're almost there in the top 3 players, in maize they never targeted this type of markets. Now we are launching these hybrids. That's the reason we strongly believe that we will grow in these markets. And the effort what we kept -- what we have gone in the last 5, 7 years in terms of the maize trading, we have spent a lot in R&D to develop these type of hybrids. And that's where you see the product mix also. That's where this is changing. These are high markets and high-price and high-margin markets. That's the reason we want to target this. But now I think we are in line to do this.

So of the overall maize market...

Excuse me, sir, I'm sorry to interrupt. May I please request you to rejoin the question queue for your follow up? Next question is from the line of Karthi Keyan from Suyash Advisors.

How's the cotton outlook for next season? What is the seed inventory you're looking at?

I think the cotton acreages will be stable. I don't see much of a moment compared to this year because the commodity price -- the cotton commodity price is good. And later half, we have seen some impact due to pink bollworm in terms of the yields at the commercial level, but I don't think the sentiment is bad with the farming community. These areas should remain. Here and there are some areas where we think like, for example, in Gujarat, we think it might go down to some extent next year. But in Telangana and Maharashtra, it may remain same. So overall, I think it should remain in the -- at least sideways here and there.

And how is your preparation in terms of inventory?

We have built up inventory for the next year. We are -- I think, at least, as we suggested earlier, 10% to 15% growth. We are -- what we are anticipating, and we are in line with those. As of now, with the present condition, we think we can grow at that 10% to 15%, for sure. And to [ better ] that, we have enough inventory what we have produced. The inventory is still at the arrival stage, but the plan what we have taken, I think we'll have enough stock to do that.

And there was no impact on seed output for you or for the industry because of these untimely rains and so on?

There will be some, but basically a plan in advance. So we have some sort of buffering to do it. So by seeing the present conditions, yes. Even our crop has been impacted, especially by pink bollworm and the untimely rain, but some 5% to 10% loss will be there for sure, but we have that buffering -- that's how we plan for entire crops. Sometimes we get more, sometimes we get lower, but we have that buffering plan. But by seeing the present conditions, the PAT already has arrived into the system. And I think we will have enough stock. We should not stock -- inventory should not be a concern for our growth rate.

Growth. Oh, wonderful. And what's the outlook for advances?

We have just -- for the -- basically, for the advances for the cotton, we have started a bit delayed compared to previous year, usually we used to start in the month of December. But we have postponed that in the month of December, end of February. Cautiously, we have taken that note because as we are taking more advances, we need to give more discounts to our dealers. So we have just postponed by 2 months. Now we are taking the advances. But if you take the advances by 31st March compared to previous year 31st March, it should be in line with that.

Next question is from the line of Abhijit Akella from IIFL.

Congrats on a good quarter. On the quarter, one question was about the subsidiaries performance. We've seem to have seen a significant improvement in profit from the subsidiaries. So if you could comment on whether this was in the seed subsidiaries or is it the micronutrients business?

Abhijit, thanks. Thanks. If you see the -- in the subsidiary business, all -- even though it's small, like, for example, the Aditya and Microtek both have contributed to some extent for our profitability. Even though a bit small, but if you see the Aditya sale, we are up by 30% to 40% in that. And in terms of the Microtek profitability, we are up by another 40% in that -- 30% to 40%. So even it's a smaller base, that's the reason the percentages looks higher. But even now going forward, we think -- even the subsidiaries contributes much because we have stabilized the entire business. As the business grows, because most of the expenses are the same, the profitability should increase.

Okay. Got it. And within the standalone business, this quarter's revenues, other than maize, rice and cotton, it seems like there's INR 36 crores coming from all the other seeds put together. So if you could give some color on which are the major categories from which this has come, vegetables or any other?

See, basically, cotton, maize and vegetables have contributed to the majority of it. For example, if you take Paddy, maize, cotton and vegetables have contributed close to INR 73 crores, INR 74 crores. The other crops have, like Sunflower, a bit of Bajra and a bit of pulses, mustard, wheat and everything and some production sales are also there in it. So these all contributed to INR 25 crores. But if you take out of -- if you take the other income, the total sales for this quarter stood at INR 98 crores, out of which close to INR 54 crores is contributed by maize alone and vegetables contributed close to INR 7 crores.

Okay. Got it. And on a full year basis, how much vegetable sales are we sort of hoping to achieve?

Last year, we have done around INR 14 crores, if I'm right, roughly around INR 14 crores. This time, we think that, at least, we've already done close to INR 15.5 crores, INR 16 crores. And fourth quarter usually is a better quarter for vegetables in the crop where we operate, especially like Okra. So we think that we'll grow at least in between that INR 25 crores -- in and around that INR 25 crores.

Okay. INR 25 crores for this year?

Yes. Against INR 13 crores -- INR 14 crores last year, we should end up in between INR 22 crores and INR 25 crores. And we are very good -- we are hoping better results in vegetables, but it's too early to predict on that, but we have very good hybrids. We are working really hard in vegetables. And we have stabilized in market also now, and we have identified hybrids. We have launched many new hybrids. We'll definitely -- going forward in the next 3 to 5 years, vegetables should be a very meaningful, I mean to say, contribution to the bottom line as the margins are pretty high in vegetables.

Yes. That's great. And one other thing. Hybrid rice prices, you mentioned in your opening remarks that they are up 57% YTD, if I'm not mistaken?

Not -- sorry, if I don't -- I said the volumes are up by 57%, not the price.

Oh, I see. Okay. So out of the 65% revenue growth we've seen, 57% is from volumes?

Basically, majority of that is from volume. And usually, every year, we increase the price by 1% or 2%. So for hybrid rice, majority is from the volume growth.

We take the next question from the line of Chirag Dagli from HDFC Asset Management.

Sir, how has profitability in cotton moved for this year versus, say, a couple of years back?

Chirag, cotton, in terms of the per packet margin, it all remains same, slightly up by INR 10 or INR 20 -- INR 10 or INR 15. But as we are increasing the volume, the profitability in the cotton crop is also going up because all the other expenses are same. Basically, the plant operation and everything that's the reason to see it combined as a whole, if it only talk about the EBITDA margin, it has grown much better than the top line. So...

Versus say, in the past, when we were selling about 1 crore packets, and now we are selling much less.

We can't compare, like, apple-to-apple and when -- see, we need to see the points like where the price was around INR 930, the royalty was around INR 170-odd. Now the price itself is close to INR 730. So the margins are definitely squeezed from 3 years back to now. The margins have definitely come down and considerably down in terms of cotton. Cotton was a very lucrative business than 4 years back. It's not right now. But if you see compared to previous year to this year, we have slightly improved our margins.

And the reason for that is, cost of production has come down?

One, one -- not exactly production. One, royalty is down compared to previous year by INR 8, INR 9. And the distributor discount has also -- we have given lower discounts. That's the reason if you say, in one of the questions I answered saying that we have postponed advance bookings for cotton. Because we -- once we take the amount, we need to give more discounts. We know that the product will definitely sell. And if we take advances even the dealers -- the channel will not be satisfied if you take advance and don't give discounts. So we've just postponed it. So we are trying in all the ways to increase the profitability in cotton. Whereas other crops, we enjoy margins, that's not a worry at all. Here, we are trying in all -- even in production, also, we are trying techniques where we can decrease the cost.

And the noncotton piece continues to be higher margin than company average, sir? That is a...

Yes, yes, yes. Because cotton is driving the margins. If you take cotton out, noncotton will have very good margins.

Has better margins. All right. And the second question was on the R&D bit, sir. If you can just talk a little bit about what you're doing now in -- especially in biotech, et cetera? What R&D effort is going on? And how soon can we see results?

We've already invested a lot in R&D and still we have -- we continue to invest in that. If you see our hiring is something more than 160 people as of now, more than 160, close to 170. Every day, we are hiring in R&D. And we -- recently we have launched biotech plant because the breeding techniques have moved on, and we want to combine the tradition breeding in the biotechnology. So we are already working on this. And now you see the results also. And we are adding many crops in that. For example, in the last, we were talking about 6, 7 years back we're talking about where we intensified other vegetable breeding activity. Later, we said maize breeding activity. Now we are launching new hybrids in rice -- within the rice, within new segments. So everywhere, we are increasing our scope, and we are doing excellent work in R&D. And we are pretty confident that we'll be coming up with some new products going forward. So...

You said, sir, 160 people in R&D?

Yes. More than 160.

Versus, say, a couple of years back, where would this number?

It was around 110, 115.

110. Okay. Okay. And what is our R&D...

And some few numbers here and there, but 110, 115, definitely, we are up by 30%, 40% in the last 3, 4 years.

Okay. Okay. And what is our annual spend, sir, on R&D now that we've got this fully-blown biotech center as well?

So there are 2 aspects in that. One is the recurring and one is the capital thing. So if you take the capital expenditure last, we invested close to INR 10 crores to INR 12 crores in the biotechnology lab. But most of the assets are our own, that's the reason that will not reflect in the actual capital spending. For example, land for our own lands. The building where we have constructed the entire -- there was a huge land within the plant premises only we have constructed the biotech lab. If you want to construct that plant by taking the land and everything, it should be close to INR 40-odd crores. So if you take out the capital expenses, which we can't compare because anyhow it's our company-owned asset, so we don't do it. But the actual money spent in providing -- getting the lab is close to INR 10 crores to INR 12 crores. And moreover that the R&D expenses are close to around INR 23 crores or INR 25 crores, I just need to get back to those exact numbers, but we are considerably increasing the R&D spend year-on-year.

And this INR 25 crores should grow meaningfully up from here as well or do you think now it is stable?

It will go. It will go, but -- see, in the last 3, 4 years, it has gone up much than what we are grown in the -- as a top line. But going forward, as we are increasing more, it should not be proportionally there because as most of the assets is our own, asset bought aside. And only the manpower cost we need to add it. So manpower cost should be negligible, but I mean to say, definitely, there will be increase in the spend. And as I said that we don't work on the gene technology, which is not capital expenses. Most of the work is -- what we do is like breeding activity, which is not that high, I mean to say, it doesn't take much capital or expenditure. It's only cost is the employee cost. That should be in proportion to that.

Next question is from the line of Rohit Nagraj from Sunidhi Securities.

Congrats for a good set of numbers. Sir, on the vegetables front, you just mentioned that this year, we may touch about say INR 25 crores, which change year-on-year growth rate of about 70%. How do you foresee a growth for FY '21 and onwards given that the base has now increased to INR 25 crores?

See, basically, because of the small base, it's reflects 60%, 70%. But if you take INR 25 crores as a base, definitely, we think that we can go in between 30-plus percent year-on-year for the next 3 to 5 years. Because vegetable market is a very big market, and we have very good products. And the products, the hybrids, where we are -- the segment where we are operating like hot pepper or hybrid tomato or okra, these are the major contributors of the vegetable market. And we have very good pipeline hybrids in those segments. So 30% with the baseline of INR 25 crores year-on-year in vegetables should not be an issue for the next 3 to 5 years.

Yes, that seems very good. Sir, on the cotton front, you have said that there are 2 cotton hybrids which are currently under demonstration. So any idea about how the results have been? And when those would be commercialized? Any potential or...

Cotton is in initial stages, but initial looks are good, that's the reason we are saying that where we have demonstrated. The -- I mean, that the feedback is really good. But we need to test that in volumes, which are pretty confident that we'll do that. Basically, these hybrids are for the Northern India, where we are not present. So definitely, we think that it will have some sort of an impact in the next 2 to 3 years in terms of these new launches.

Right. And on a strategy perspective. So the last 3 years, we have taken buyback to reward the shareholders and from next year onwards, again, our cash flows will be stronger. So from a relatively longer-term strategy, what is our thought process that will be going only for buyback or maybe for acquisition or diversification? So just a broader strategy from the management perspective.

Basically, we were saying the same thing for the last 5 years, as we said that we require INR 300 crores of [ watches ] and more -- and over and above that, whatever is earned, we want to reward it to shareholders that we are continuing it. Here's 1 point, if you see, if you really see any meaningful business, any capital in the plant definitely we'll do it. But as of now, we don't have anything to deploy it. And as a business, it's not that capital expense and most of the infrastructure is already there. We can almost -- with a few crores of rupees year-on-year at the most, for example, yearly INR 20 crores to INR 30 crores of CapEx year-on-year. Some were more or less compared to year-on-year, we think that we can grow our business by 15% to 20% year-on-year. So I don't think as a company, we don't require much cash. And as we were continuing to give the -- rewarding the shareholders might be in terms of the buyback of the dividend, I think, as of now, still, our intention is to rewards to shareholders. That is subjected to the board's decision. But we -- in principle, we want to reward, we don't have any much use of this cash.

Just last question on FY '21 guidance. So does the guidance versus 15%, 20% overall revenue growth, and for the cotton will be 10% to 15%?

Yes. We still stick to the same guidance of 15% to 20% growth with cotton between 10% to 15% and noncotton 20% to 25%.

[Operator Instructions] Next question is from the line of Nandan Vartak from Wealth Managers.

So my question is on rice market. So if you could give some number or size of volume or value, which ever is available or -- which would be helpful.

Yes. The hybrid rice market should be close to around that 45,000 tonne to 50,000 tonne market as of now.

45,000 tonnes to 50,000 tonnes.

45,000 tonnes to 50,000 tonnes.