Lloyds Metals and Energy Limited ($512455)

Ladies and gentlemen, good day, and welcome to the Lloyds Metals and Energy 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. Shiwang Singh. Thank you, and over to you, sir.

Good afternoon, everyone. And thank you for joining us today. We at Equirus are pleased to host Lloyd's Metals and Energy 4Q and FY '26 Earnings Call. We have with us today Mr. Rajesh Gupta, Managing Director; Mr. Riyaz Shaikj, Chief Financial Officer; and Mr. S.K. Naredi, Director of Finance from [ Cavena. ] We would like to begin the call with brief opening remarks from the management, following which we will have the forum open for an interactive Q&A session. Before we start, I would like to point out that some statements made in today's call may be forward-looking in nature. Under disclaimer to this has been included in the earnings presentation shared with you earlier. Now I would like to invite Mr. Rajesh Gupta to initiate the proceedings for the results call. Over to you, sir.

Good afternoon, everyone. A very warm welcome to all the participants joining us on this call today. Thank you, Shiwang, and the entire Equirus team. We deeply value your continued support and engagement. It fills with me with immense pride to share that Note had crossed the consolidate market cap of milestone that would have seemed listed not long ago. This might belong first and former to every single investor each and every 1 of you who backed us through our 50-year journey through our early days of uncertainty and up to this milestone. This I'm saying from a -- as a guy who thought that I meant industrial relations only. Your patience is a reflection of trust, you rate us, and we take that responsibility very seriously. Our sincere, attitude to all our investors, anistaneholders joining us on this call and on the journey. Before I speak about this -- our performance, I want to take a moment to acknowledge our team at the mine, at the plants and all the offices all over the world. What has been achieved by us in the FY is quite extraordinary. It did not happen by accelerate. It happened because -- because of a team that showed up every day with clarity of purpose and a relentless focus on execution. In the last 50 years, I will see in the last 5 years, sorry, in the last 5 years, our CAGR on revenue is up by 109%. And on PAT, the CAR is a whopping 39%. They show that we are a 50-year-old startup. This year, our stand-alone profit crossed INR 3,100 crores. on a stand-alone basis and INR 3,800 crores, INR 829 crores on a consolidated basis. Consolidated revenue cross INR 17,000 crores, fast supporting a $2 billion mark. On operations front, our iron scale from 10 million to 22 million tonnes, which is a 20% growth in a single year. The credit plant commissioned at the fag end of Q2 meet 100% capacity visitor within just 4 months, 3 months -- 3 million tonnes in 9 months, a ramp up that very few plants anywhere in the country have achieved volumes scaled 56% year-on-year with the new deal ramping up as steadily as we connect plan. Going on to the projects, we have invested heavily for the future, INR 3,500 crores in the last 4 years, and this will continue. In concern Gecina, we have completed the 2 are plants hedging capacity of 8 million tonnes, making us the largest merchant pellet player by far. And we also commissioned along with this, the 85-kilometer slurry pipeline, which is delivering now cost savings and operational stability. In the mine and here, we have completed our mine capacity increase from 3 million to 55 million tonnes with a salable output of 26 million tonnes over the last 4 years. The BSG beneficiation project is progressing. Parent results have delivered excellent yields and major enduring contracts are completed, constriction machines mobilized. All media machine are ordered on a key European supplier, and we are well in target of first phase is by December 2027. This plant, the BHG benefication is a trail resin India and will lead to greening of our company in a steel cycle in very dramatic ways. Meanwhile in Chandrapur, the DRI capacity doubled our power capacity is stable to 100 million tonnes -- 100 megawatts, sorry, and it is stabilized. The steel plant, that is a large furnace, a furnace, Coco and the rolling mill of 1.2 million tonne wirerod is well underway for commissioning for last quarter this year. The engineering of this third pellet plant is also nearing complete in Chandrapur, along with the 195-kilometer pipeline from [indiscernible] Chandrapur Stockyard this pipeline will reduce register quart for most of the iron ore output by us by more than 500 a tonne and it's an advanced planning stage, few milestones for us on the efficiency front. The EBITDA margin has held steady at approximately 34% across both the last 2 quarters, demonstrating structural cost efficiency and not one-off gains. Return on capital employed stood at 56% ex CWIP for FY '26 and return on equity at 37%. These are world-class metrics. Rising parity competition is maintained, along with a volume increase of 120% and new products like we had been started. We remain ranked #1 among 383 open cast mines in India by the Ministry of Coal, a reflection of operational excellence across the group. Other than [ Sundar, ] the growth in Hewani operations in Odisha and Hakan continue with 3 new mining operations starting. A few key updates on copper. Copper, which is the new gold and combo, which is our new Surjager, is led by Surya. I want to regulate this team and for successful commissioning of the Suria copper plant in 6 months. We are the first Indian integrated player in the copper business. Copper is the backbone of energy, transition, electrification and renewables. It is the perfect oil to our One mine portfolio and also our international entry to critical minerals. We have defined pathway to expand the magnitude 30,000 tonnes in per annum at Suria mines. In addition, we have acquired 49% in Kemi Group. This is the first week after the U.S. and Congo signed a critical middle agreement in December 2025. And we are proud to be at the forefront of the strategic realignment in global critical minerals. [indiscernible] is a large operating copper cobalt platform in the Katanga copper belt with 50-plus permits. Cobalt capacity is expected to scale to approximately 20,000 tonnes in the 2 operating plans. Along with this, we will be achieving 100,000 tonnes of copper over the next 3 to 5 years from both Canaan and surya. Let me give you our FY '27 outlook briefly. The steel markets and therefore, iron ore are as strong as they were, especially in Indian market. Our FY '27 guidance reflect the next change in our scale, annual production at 26 million tonnes, dispatches of 27 million tonnes, pellet of 7.75 to 8 million tonnes. DR at 125,000 tonnes, at 825,000 tonnes and a formal entry into steel making with wire rod mill production at around 150,000 tonnes. We expect annual cost savings to surpass INR 2,000 crores per annum as all logistics and sustainability initiatives are maturing by March 28. FY '26 has been a year of extraordinary achievement. Our financials have never been stronger. Our operational foundation has never been robust. And our strategic pipeline in reiterate steel and now in copper has never been more exciting. We remain deeply grateful to all our investors, partners and every member of our team. Without taking more of a time, I hand over the call to Riyaz. Mr. Naredi and Mr. Hemankur will take you through the detailed financial operations of the Triveni and the congo operations as well. Thank you, once again, everybody.

Thank you, Rajeshji. Good evening, everyone. I want to open with a line from Aristotle that I believe captures exactly what FY '26 means for us. We are what we repeatedly do. excellence, then is not an act but a habit. That is precisely the story of our FY '26 numbers. The margin you will see today are not a onetime event. They are the outcome of systems we have built, disciplines we have embedded and habits of execution that run deep across every function of this organization. With the context, I will take you through the stand-alone financials and operating performance for Q4 and the full year FY '26, focusing on the numbers, margins and CapEx. For the financial highlights for quarter 4 FY '26 stand-alone. This has been the strongest quarter we have ever reported on a stand-alone basis. The total income came in at INR 4,927 crores registering a remarkable 310% year-on-year growth. EBITDA was INR 1,679 crores, up 98% year-on-year and near 6-fold jump in absolute profitability. PAT stood at INR 1,066 crores, up 368% year-on-year. EBITDA margin expanded to 33.73% in quarter 4, an improvement of more than 1,000 basis points year-on-year. for the financial highlights of the full year FY '26. FY '26 without doubt the best year, Lloyd metals that ever had across every single metric. Total income for FY '26 stood at approximately INR 13,838 crores, up 104% year-on-year. We more than doubled our revenues in a single year. EBITDA came in at INR 673 crores, growing 133% year-on-year. PAT was INR 3,194 crores, up 120% year-on-year. minor the full year stood at 33.77%, up 418 basis points year-on-year. The margin improvement is not one-off. It is structural, and it's coming from higher share of value-added products, especially pellets in the revenue mix benefits of the slurry pipeline, which has started flowing meaningfully into the P&L, better utilization across mining, pellets and DR, right, operating leverage as volumes case significantly. Turning to the operational highlights for iron ore. Iron ore production for quarter 4 FY '26 was 9.09 million tonnes, up 529% year-on-year. For the full year, production stood at 21.96 million tonnes, up 120% year-on-year. Iron ore sales volume for quarter 4 FY '26 was 6.16 million tonnes, up to 71% year-on-year for FY '26 total sales were 16.18 million tonnes, up 71% year-on-year. Realization per tonne stood at INR 5,848 in quarter 4 and INR 5,806 for the full year. EBITDA per ton was INR 1,894 in quarter 4 and 1930 for FY '26, reflecting strong unit economics. Our monthly run rate in April 2026 is already at approximately 2 million tonnes, undermining a strong start for FY '27. Now the operational highlights for pellets. Pellet production for quarter 4 FY '26 was 1.08 million tonnes and for the full year was 3.03 million tonnes. The pellet plant commenced commercial production at the back end of quarter 2 FY '26, within 4 months of commissioning, it has already reached 100% capacity utilization, which is an exceptional execution outcome. Realization per tonne for quarter 4 FY '20 stood at INR 9,590, supported by strong product quality and strategic geographic positioning. EBITDA per tonne per pallet stood at INR 4,040 in quarter 4 gross margin driven by captive iron ore slurry pipeline-based evacuation and strong domestic demand. I'm also pleased to share that the second pellet plant was commissioned in May 2026. This takes our total pellet capacity to 8 million tonnes per annum and positions us strongly for FY '27 volume growth. For the operational highlights of DRI and Power, DRI sales volume for quarter 4 FY '26 was 188,000 tonnes, up 171% year-on-year -- for the full year, DRI volumes were 480,000 tonnes, up 56% year-on-year. DRI realization stood at INR 27,300 per ton in quarter 4 with EBITDA per tonne of INR 7,999 strong unit economics. Power volumes were up 48% year-on-year in quarter 4 FY '26. The value added mix. Value-added products now account for 32% of FY '26 stand-alone revenues, up from 20% in FY '25. -- in terms of EBIT contribution, the share is 30%, up from 11% in FY '25. This mix shift is central to improving margin stability, reducing volatility and enhancing overall return metrics. With pellet plant 2 now commissioned and the wirerod mill on track, this VAP share is expected to improve further in FY '27. Coming for the CapEx update, the company has incurred CapEx of approximately INR 13,500 crores during FY '20 to FY '26. FY '26 stand-alone CapEx alone was INR 8,100 -- close to INR 8,100 crores, reflecting the significant investment phase we are currently in. Key projects funded into 2 pellet plants, DRI expansions, slurry pipeline, investments and the ongoing CapEx of the seed plant. Importantly, CapEx execution is on track and within approved budgets. To give further color on CapEx of INR 300 crores -- we have capitalized INR 5,100 crores of assets comprising mainly of pellet plant 1, slurry pipeline and the DRI plants. INR 1,850 crores is capital advances. Remaining is CWIP, which you can see is in our published numbers. The balance sheet and the net debt. Stand-alone net debt as on 31st March 2026 stands at INR 3,901 crores, a manageable level given our EBITDA generation. Despite an intensive CapEx cycle, the balance sheet remains comfortable. Strong EBITDA has supported internal approval led funding and control leverage. Working capital continues to be well managed, helped by faster dispatch cycles and healthy demand conditions. To summarize, FY '26 stand-alone performance has been extraordinary across every metric. Margins are structurally strong. CapEx execution remains disciplined and the pipeline into FY '24 is the strongest it has ever been. With that, I will hand over to Narediji for Thriveni performance.

Thank you, Rajeshji and Riyazji. Good evening, everyone. For us at Triveni, growth has always been about disciplined execution, consistency and doing the fundamentals right day in and day out. Let me take you through Triveni's performance in Q4 and the full year FY '26. Financial overview, IPL FY '26. From a financial perspective, FY '26 has been a transformational year for the wine. The total income for the full year stood at approximately INR 8,000 crores to be precise INR 799 crores with an EBITDA read EBITDA margin of approximately 25%. This compares to the EBITDA of INR 1,062 crores and margins of approximately INR 16 crores in FY '25, and nearly doubling of EBITDA in a single year. In Q4, FY '26 specifically, EBITDA was INR 910 crores with margins of 36%, reflecting exceptional operational operating leverage as volumes scale. Cash PAT for the full year stood at INR 1,196 crores with cash PAT margins of approximately 15%. The improvement in margins reflects better operating leverage, higher equipment utilization and continued focus on cost discipline across all project part. I'll come to the operations at Gadchiroli, the environmental capacity at [indiscernible] mine has been increased from 10 million tonnes per annum to 55 million tonnes per annum, a massive regulatory win that unlocks significant volume headroom. FY '27 volume growth is expected to be more than 75%, including BHQ, underpinned by full-scale operations at Central Hill and completion of FY '27 equipment mobilization as presided. We have now deployed 88 electric equipment units at the mine and 20 electrical units at the railway siding that firmly establishes our green mining credentials. BHQ verification plan Excavation has commenced with 22 large-scale equipment mobilized, 14 mobile crushers and 26 heavy earthmoving machines are also deployed for BHQ crushing at the mine. We have also established a full EV LNG ecosystem at Surjagarh Mine. 100-tonne diesel dumper has been successfully converted to LNG hybrid operation, which is a significant sustainability milestones. Now Orissa operations. Our Orissa operations also continued to scale meaningfully. One of the mine MGA mine has been awarded the prestigious 5-star rating by Indian wear of mine, which reflects our operational quality. Guali iron ore mine production has also been enhanced from 7.4 million tonnes per annum to 9 million tonnes per annum. Sarojini Pradhan mine has scaled up from 0.57 million tonnes to 4.9 million tonnes per annum. These are significant capacity additions. Talpa iron ore mine, it's a new mine and the operations are expected to commence in Q1 of FY '27 with FY '27 production target of 3 million tonnes. Lazada butchery mines again a new mine, the MDP has been signed and operations are to commence in Q1 FY '27 with the FY '21 production target of 1.5 million tonnes per annum. Shrimetallic mine capacity has increased million tonnes to 1.8 million tonnes. Overall, the Orissa operation volumes are expected to increase by 39% year-to-year to 34 million to 35 million tonnes in FY '27. I One of the mining lease [indiscernible] Saga mine was selected for the 11 Excellence Award and acknowledgment of our operational and sustainability standards. I'm coming to coal Thriveni Sonic Mining, our subsidiary, PB West and PV Northwest, BBWs has achieved the highest distinction of the 5-star rating from the Ministry of Coal ranking #1 among 383 open cast mines across India, which is an extraordinary distinction. PV Mine was also awarded the overall winner at the sixth Annual Mine Safety Week receiving the Suraksha Sikar Gold Award. Iron Re set at a national record in FY '26, completing over 1,400 houses, which is 14% of the previous year's target and acquiring over 420 acres of land, which is 103% of the target. A record for ELE performance at PB West that OB removal has been at 72.8 million. Ore production was 17.5 million tonnes, full crushing and dispatched 1.4 million tonnes, IPCC commission on 11th August '25, handling 2.89 million tonnes, electrical loading 21.8 million BCM that is up to -- up by 80% year-on-year. Electric drill 1.5 lakh meters that is up 45% year-on-year. Wireless communication system implemented across all HMM and mid-scale equipment. Now coming to international and new ventures. International on Indonesia, we are rationalizing lower-margin operations and plan to redeploy equipment to high return opportunities in Congo and P&G. On Geomysore gold mining, our MDU and exploration contract commenced in January 26, we have a targeted EBITDA contribution of approximately INR 60 crores in FY '27, a meaningful new revenue stream with further upside as exploration progresses. The outlook. Thriveni's focus remains clear, scale responsibility execute efficiently and protect margins through productivity and cost optimization. The pipeline for FY '27 looks strong across Gadchiroli, Orissa and coal operations. We are confident of sustaining both growth and profitability. With that, I hand over to mike to Hemankur sir. Thank you.

Yes. Hello. We'll open up for the questions Shivansh.

[Operator Instructions]. The first question is from the line of Amit Dikshit from GS.

Congratulations for good performance. A couple of questions from my side. The first 1 is on Slide 25. -- where you have this arrangement with Tata Steel on the BRPL project. Just wanted to understand the economics of this because you have mentioned that the free cash and the profit accruing to us I mean it's quite substantial. So just wanted to understand the CapEx part of it and how we are looking at operations to ensure that this kind of -- these kind of numbers in terms of free cash accrued to us.

Yes, thanks, Amit, for the question. So as you rightly said, I mean, this is a business which is already in place, so far, generating this kind of free cash flow, the amount of sustaining CapEx is not much. So that's why the free cash flows are high because this is a take-or-pay contract that we have with Tata Steel as a captive consumer. This is of grid strategic benefit to Tata Steel because this operates a pipeline, which is near about the mine mouth of their existing mines, and it opens up near the Kalinganagar plant within the 5-kilometer radius. So because of which, the entire capacity is dedicated to them. And as a part of our shareholder agreement, this was agreed as a margin for the existing assets. So that's why this is a large amount of free cash flow. You would also recall that we had signed MOU with Tata Steel for evaluating multiple projects which involved some of the projects that we'll be picking up with them. It involved working on slurry pipeline for their projects. It involved steel plant facility in Gadchiroli and it also involved new MDO projects that we'll be doing with them. So given all of that, we are progressing on some of those projects. So as of now, those projects, CapEx is still being finalized because they are still in the discussion and finalization states. But some of these free cash flow will go towards generation of and development of those projects. But we have -- we intend to maintain a high return on capital for such projects, so that it is deployed and suitable for maintaining the higher return on capital that we have.

Sir, just a related question to this, because our expertise in laying Clary pipeline in record time is quite well documented. So is there some exclusivity that you have with Tata Steel or you can approach any other steel players because a lot of them are looking for the...

There's no...

Okay. Okay. The second question I have is on the combo operations and consolation for starting the copper operations over there. I mean, just wondering what kind of incremental you expect to incur in both copper and Cobalt project to reach the capacities that you have mentioned. Also, on the related note, this geography is not the easiest 1 to work. So what specific steps you are taking to ensure that -- because -- I mean you have started operations. And I would say I don't recall any other company that has done that in such a small time.

Yes. So thanks again, Amit. Yes, definitely, it's a new territory, and that's where the new opportunities are coming out of it. And that's why we see that this was a very unique case which presented us an asset which was near operational. So to answer the first question, how much capital expenditure will be required this plant is near about 85% to 90% complete. We are already engaging with the EPC players. These are world-class EPC players. The plants are designed and built by people like Autotech and big rim from China. So we are getting them back on the ground. I think within this month, we are getting them up and running. In terms of completion of the plant, the total plant CapEx initially was near about $1.1 billion, out of which $800-plus million has already been spent. Based on our current evaluation, including the initial working capital and the mine development, which will be feeding these plants. It would require near about $200 million to $260 million. We are still working on the exact numbers, but this is a fairly broad estimate, which can be taken at the moment. In terms of players who are operating and working in the mines in Congo, it's a fairly established mining destination. It had its challenges earlier, but given the rising demand of copper and cobalt as a strategic material for defense products, particularly apart from the batteries, this is something which is of great importance to U.S. So U.S. because, I mean, U.S. has also started realizing that a lot of supply chain of critical minerals is basically residing with China. And whenever these tariff barriers and different problems happened, they saw that the supply chain can be choked. So that was one of the key things which kind of drove us to this because having this kind of an asset at such a large scale, yes, you are right, it is a high risk if were doing it alone. -- but that risk is mitigated by the fact that we are partnering with the U.S. and U.S. as a strategic and critical minerals deal, which was signed in 2025. So in fact, we have very strong support from U.S. And given the kind of support that U.S. is building with DRC, there is a strong operation. and this is the first project under this flagship project, so it becomes derisked by the same amount. It's something what you can probably see with Sujagarlike it was 1 of the first projects that we opened up here -- so of course, risk was there. But this was the first project in Maharashtra. So for Mahrashtra [indiscernible] was new. And now Maharashtra is looking at opening up many more mines and coming up additional iron ore. So this gives us a good entry and also helps us build a very strong partnership with U.S. because they see us as reliable, credible operators. So in difficult terrains wherever the U.S. companies are not able to operate or not able to scale as fast as they would want the supply chains to be built. We would be a partner of choice. So this is an alternate to China on the global scale, and that's why we see this partnership is something, which will be quite important and also derisked in the entire process because of the presence of U.S.

The next question is from the line of Vikas Singh from ICICI Securities.

Congratulation on very good set of numbers. Sir, my first question pertains to Thriveni. If I look at our iron ore ramp-up has been largely been done. While the coal has not been ramping up. So are we going to expect volume growth in this segment? Because if I remember correctly, a couple of quarters back, we have given a pretty good numbers in terms of revenue guidance on the Thriveni side. And what has caused this margin expansion on the year-on-year basis from EBITDA margin of 16% to 25%.

In iron ore, we are starting through new mining leases. And for the other mining leases where we are already doing, we have got the environmental clearance enhancement and due to that, the iron ore production is going to be higher as compared to the earlier year. And in respect of coal, as we stated, Indonesian operations, we are slightly slowing down due to lower margins. And Jharkhand operations, the contract volumes and all these things we are achieving. So yes, we'll be increasing our revenues, quantity in iron ore more as compared to coal and Surjagarh also, we have got a large expansion. So there also, we are going to increase it. So this is the reason that iron ore expansion will be much more as compared to coal.

Okay. Sir, just a follow-up question on this. We, in the remarks, somebody said that 37%, 39% higher iron ore production could be there. Would our revenue follow the similar model or the rates are different and revenue growth would be lower than that.

No, no. Revenue growth will be there, and we'll be getting the benefit of economies of scale. So our revenues will be much, much better.

No. So would that go in tandem with the volume at assuming the same kind of risk we are getting across the board or the intensity of would be lower than the volume growth. That's what I was asking effectively.

No more or less, it will be the same.

Top line would be no on as the same. Bottom line would be faster because of the economies of scale.

Noted sir. Sir, my second question pertains to our realization this quarter. If I see iron ore and pellets, there was a deviation 1 has gone up on a sequential basis, while the paratration gone down, which is a little bit surprising. So could you explain what has happened there? And what is the spot realization. Have we also taken price hike today?

What has gone down? Pellet?

So sequentially was down as per our own presentation, while the iron ore has been up sharply. So just wanted to understand...

As volumes have gone up in pellet, we have had to search new markets, and that is where the parent realizations are a little lower because the newer markets are at a distance. -- some tenders were there earlier, which we have not been able to reestablish again. And we have been doing a little bit more export. On the pricing of iron ore, it's more or less driven by the market, we are in line with the rest of the market and the steel market. not sir. And sir, lastly, if you could give us some update on your BHQ project because next year, if I remember correctly, we wanted to do more of a low-grade beneficiation versus the high-grade sales -- so our -- in my opening remarks, I mentioned that by December 2027, the BHQ first phase of 30 million tonnes input and around output would be commissioned. And the land is it with us, the equipment has been mobilized. The construction equipment has been mobilized. The crushing of the material has started, and we'll be pushing the male on to the site and getting it evacuated from the site in this year. And over the next 2 years, that material will be accumulated there. And the -- as far as the project extent is concerned, we are going ahead with the total engineering [indiscernible] company. The main ordering of 85%, 90% has been ordered on very 5-star parties. The pellet plant has helped us a lot in establishing the [indiscernible] engineering and that is the status.

Sir, since we are beneficiating and the mining ratio to output is lower -- do we expect that once the BHQ picks up our overall blended EBITDA pattern on the iron ore side, Atlas could settle on a lower scale.

It will be on higher scale because BHQ benefited or will be 66%, 67%, the cost upside is around INR 200, which I think we explained in the last con call, and particularly with the revised notification of the government on reduced royalties. So with the upside on the cost may be around INR 20 crores, INR 30 the upside on the selling price or on the usage level, even if you do it internally, it will be at least INR 700, INR 800. So we think that the EBITDA will go up once the BHQ is commissioned.

Sir, wouldn't the mining cost per tonne of the final material would be 3x, 2.5x higher, so that should get added in the first on the beneficiation.

The much bigger scale volumes. So we would have -- like I said, the total cost would be in that range. just -- and the royalties are much.

This is adjusted for the mining ratio you're talking about.

Absolutely. Absolutely. I'm talking about net [indiscernible].

The next question is from the line of Jashandeep Singh from Nomura.

Congratulations for a great set of results. Sir, my first question is regarding CapEx. As you were highlighting how much CapEx will be required for the second copper team that you have entered I just wanted to understand with that in mind, what will be our FY '27, '28 CapEx guidance for controlled Lloyds now? And in line with that, with CapEx increasing, I mean, they're also increasing significantly. But what will be a sustainable net debt-to-EBITDA or leverage numbers for the company? And is the company looking for any deleveraging in the FY '27, '28? That would be my first question.

The total CapEx, excluding the ISP for the [ Consul ] unit is around INR 28,000 crores, that is what we have. of which we have already spent, as I have mentioned earlier, is INR 1,500-odd crores. So that remains with the INR 14,500 crores to be spent over the next 2 years. Next year, our plan is around between INR 10,000 crores to INR 11,000 crores is what we are planning to explain because that included a lot of portion from the BHQ plant and the ISP at Chandrapur. So it should be on 10 down in the next year, it should be 50 plus yes, in 27, 28, by that time, we would be clear on the larger steel plant at Konsari. So and also the copper, so all those expenditures will be further included in this and should be a larger number.

Sir, largely copper CapEx will start from FY '28. Is that right? And also on deleveraging of your sustainable net debt FY '27 also, there will be copper investments.

Yes. So actually, the majority of the copper investments will get done in FY '27, so we should have the revenues and profitability from copper coming in from FY '28. Because, as I said, the plants are near about 85% to 90% complete. So we want to get them running as app, and that's why large part of the CapEx, which actually be done this year.

And to this, you would have to add the remaining CapEx also since you are for consolidated then CapEx would be around INR 100 crores in this coming year, in this current year.

And the INR 10,000 crores to INR 11,000 crores also includes thriveni and copper. Is my understanding right, sir?

No, no. That's on a stand-alone basis.

That's Yes. So consol, how much will be consoled?

In terms of CapEx, you are asking?

Yes, yes.

Sso basically, on a consol basis, copper will be, as I mentioned earlier, were about $200 million to $260 million. So we can add near about INR 2,000 crores.

Around INR 15,000 crores, and so it will be INR 1,000 crores for CapEx in this '26.

Right, sir. And any plan of deleveraging severely because most of the debt on the consol book is from Thriveni. So any plan for the next 2 years to reduce the debt on Thriveni. And what is your target net debt to EBITDA that the management is internally working with?

Remaining debt, yes, we are looking at if we have plans of -- the RPS as it is reducing pursue paid around INR 700-odd crores in the month of April for the ages. So that INR 2,100 crores in the debt is. of INR 700 crores is happening. So over the next 3 years, that INR 2,000 crore reduces, so the debt automatically comes down.

Understood. And sir, my last question, again, because Lloyd is expanding and growing at such a rapid pace. Will all of the CapEx will be completely able to manage out the CapEx for internal approvals? Or is there plan or is management looking towards raising some more capital either through debt or equity in the near future? How is management looking towards it.

Yes, that we would be raising. As we have mentioned, we should be able to have a proper mix of debt, the EBITDA should be around 1, 1.5x of the EBITDA not more than that. That is what our numbers would be. Equity as of now, we've not planned of anything, and we don't -- in the near future, so we don't intend on any equity would be if ever, would be in the books of Thriveni for an IPO in that company at a later stage, not in this year.

Understood, sir. And sir, my last question will be largely towards the new government regulation, which came, which is now is fixing ASP for I don't know, grade below 45% with the close to 2/3 of your reserves being in that category, while I understand minification will be there, and you will be selling the output will be higher grade, but just wanted to understand how does that recognition? Or how does the management look at that regulation, whether there will be benefits in terms of royalty or whether there will be benefits in more offtakes happening of the lower grade? Just wanted to understand that.

So the royalties paid on material going out of the mine and the lower grade of less than 45 or less than the 35 would be going out to the mine, entailing royalty at the rate of 50% or 75%, respectively. So that would reduce our BHQ output cost to the BHQ plant. So it helps us in terms of reduction of cost.

Understood, sir. And just one last question. Sir mentioned that INR 2,000 per tonne saving coming from largely from transport. Can we have a breakdown of that? And how much will be coming from [indiscernible].

I mentioned INR 2,000 crores over the next -- once the second pipeline is commissioned, from dry to August via the Chandrapur stockyard, all our 16 million tonnes of martinich is now being transported to the railway siding or to various customers by truck at INR 600 a tonne 50 tonne will be saved. So that itself is INR 1,000 crores plus whatever pipeline we're already doing right now plus our solar projects and other green initiatives, plus various initiatives during all the sites. So we have carried a total of INR 1,000 crores per year going forward from 2028 onwards.

The next question is from the line of Ritesh Bhagwati from Alpha Plus Capital.

First of all, congrats on a great set of numbers. Firstly, in regards to our DRC assets. So we saw our commercial production of 12,000 tonnes per annum copper cathode plant at Suria mine was commissioned in March 26. So and plus we have done an acquisition of another 49% stake in chemo. So what I want to, first of all, understand is how are we seeing this ramp-up of 10,000 tonnes per annum to 30,000 tonnes per annum happening? So what is the time line for that? Secondly, what I also want to understand is how are we seeing the integration of DRC assets happening? And what sort of revenue and EBITDA contribution can we see in this financial year?

So I'll explain on both the assets. So the first asset actually was commissioned and started producing copper plates in March 2026. So we have produced near about 700 to 750 tonnes of copper as of date. The plant as per budget is able to produce near about 40 to 45 tonnes per day. We are having certain supply shortages on the sulfuric acid because it's an inland country. So because of which there is a slightly lower volume than expected. But good thing is that with the plant that we acquired the other company, we have a sulfuric acid plant. So we are now continuing to supply sulfuric acid from that. So there is synergy between the 2 companies. So with that, I think we are looking at producing a total of around 9,000 to 10,000 tonnes of copper for the financial year ending this year. [ Shama ] will not produce anything this year. It is expected to start production meaningfully by July of 2027. When the plants are expected to be commissioned. So a big uplift will come when those plants are completed and they start operating fully. They are fully integrated plants in terms of mine next door to the plants. So we'll have near about 90,000 tons of copper production, but starting from July 2027. Until then, we will have around 800 to 900 tonnes of copper that we expect. Once we solve the sulfuric acid problems, which should be sorted in the next 3 months. So that's broadly the production profile for the Congo assets.

Okay. So basically, I also want to understand our stake acquisition that we have done for Lloyd's Panguna, which we will engage with the [ Boganville ] Corporate Limited. -- if you can just provide some clarity on the strategic road map, anticipated time line for securing mining rights?

No, asset has been taken over. It's -- we have created a company for future actions in that country. It is a very active -- was a very active mine 40 years back with port built, roads built and the mine commission and well established, et cetera, with really rich copper and gold deposit. But the -- it's still in the discussion stage. We have got the rights only and nothing else has been acquired and we need like you say, setting our foot into the area.

Okay. So just lastly on our pellet plant. So like we have recently commissioned our second pellet plant as well. So what I try to understand is like when do we expect both pellet plants together to reach the expanded capacity of 10 million tonnes per annum from our original 8 million tonnes per annum.

It's 8 million tonnes, 2 million to 4 million tons. The first plant in the first 9 months of operation has achieved 3 million tonnes, which is within the capacity. We hope to repeat that in the second plant as well. And therefore, we hope to achieve 7.5 million to 8 million tonnes in this complete year.

The next question is from the line of Shruti Agarwal from [Chattisgarh ] Investment.

Firstly, congratulations to the team for a great set of numbers. Sir, my first question is the receivables increased from INR 171 crores to INR 1,480 crores on a consolidated number. That is 3.24x. So is this from the Thriveni or on stand-alone like.

Yes. last year, it was not a consolidated because even is just acquired in this year. So only 9 months have been consolidated. So if you're looking at the consolidated numbers, then it is -- you're not -- it is not comparable, if you compare it with the last number.

[Operator Instructions]. The next question is from the line of [ Parth Kotak ] from [indiscernible] 91 Asset Management.

Congratulations for a good set of numbers. Sir, actually, I have a couple of questions. The first 1 is an extension to the previous participant's question. I understand that now since MDO is integrated with our operations. If you could just give a bit of color on our receivable days and inventory days and payable days for the consolidated entity going ahead. And second, sir, if you could just on an accounting side, provide the number for IPS benefit this year, it would be really helpful.

On the IPA benefits, basically, it is right now around 1 year in accrual, 1 year post the claim to be made. The claim will be made in June. -- for the last year. So we would get the money in June 2027 or currently. We're trying to see how that can be expedited. For the consolidated receivables data, I think this question is a very interesting question. We don't have the clear cut answer on why exactly that movement is there. We come back very shortly on that. In the receivables of 15 to 30 days. In metal

Inn coal, it is 15 days and [indiscernible] it is 15 days.

So we -- and so it is similar in employ metal -- we'll figure out exactly the reasoning behind it and come back.

The next question is from the line of from Amay Sharda from [ Puna Investment Adviser. ]. Since there's no reply from the line of Mr. Amay Sharada. I'll provide the next question, which is from Harsh Shah from Seven Rivers Holdings.

Sir, in your slide, you have given a guidance of 26 million tonnes for FY '27 production of iron ore -- can you give us a split how much of this will be consumed internally for the downstream drugs? And what will be sold outside.

Around 8 million tonnes -- 8.85 million tonnes -- INR 8.8 million consumed internally for the pellet plant. And the DRI plant may be another 200,000 tonnes. So around 9 million we consumed this year. in general plus Part of the part of the would also consume internally in the steel in the DRI plant.

The next question is from the line of Siddharth Gadekar from Equirus Securities Limited.

So first on the SMAC acquisition, can you just speak on the debt that we have acquired with that entity? And how should 1 think about that debt?

Yes. Thank you. I mean, yes, I think that needs a little bit of clarity because otherwise, it may look that we have acquired a lot of debt -- so we have become owners of the companies, of course, the company was under stress. So there's a lot of debt, which has accrued built up, and they have spent that on the plant. But as a part of the overall negotiation process, we have also made settlement agreements with the key creditors -- so actually, the total debt, which is there on the books of Shama is around $800 million. Large creditors mostly we have negotiated and effectively, once we pay out those creditors, this debt will be reduced by $475 million. So that's the amount of negotiation that has been done. And the balance of the debt, which will be remaining on the books, which is near about $330 million. That is fully on record, and it will stay at the company level in hem Also, we are negotiating on that with some of the smaller parties which are there. So we'll go through that process and possibly we can also receive some benefits from there. So that's broadly the current debt for completing the plant, possibly we'll borrow additional $200 million, which will also be nonrecourse to LML and borrowed at the asset level because the assets itself is near about $1 billion, which is already put on the ground.

Sir, secondly, in terms of the ramp-up on SMAC, how should 1 think about the ramp-up in this asset?

So as I answered earlier, I mean, July 2027, we should see nearly full commercial daily production. So we should be producing near about 8,000 tonnes of copper, including the Suryamine. So only Semak itself, it will be near about 6,000 to 5,500 tonnes per month.

Sir, and the entire debt will get consolidated into a console balance sheet? Or how should 1 think about that?

Yes, that's right. So although we own 49%, but because we are having the operational control on the ground, and we are the ones who are running the operations, which is typically for us as something which we like and control because effectively, we need the operational controls to make the assets -- so that's why because of that reason, even though we are 49%, we have operational control, and thus, it gets consolidated into our books.

Okay. Good. Sir, lastly, on the stand-alone operations on the pellet, we had spoken about some debottlenecking that we were doing on the stand-alone operation. So when should we start seeing the benefits of that debottlenecking coming in?

We are studying and applying to the government for relevant permissions. We should get that by the year-end '26, '27. So next year, we will see increased production in that.

That will be for both the pellet plants or only the first plant?

Yes, both the pellet plants.

with the -- so effectively, we can go to 10 million tonne of pellet capacities with deal to plan?

No guidance on that, but yes, that is the target.

The next question is from the line of Netra Deshpande from Mirae Asset share Kan.

Congratulations to you all for a remarkable set of numbers and metallist numbers for FY '26. So to start with the first question, we would like to know, as have already set the estimated fees for the second cost and so extending ports? And what would be the time line for that as the steady pipeline for the project -- the Phase 1, the cost and already cooled the earlier station. So can you shed some

We're not able to understand that -- can you be...

So what would be the Phase 2 cost and the time line for the the overall total project for the slurry pipeline capacity of utilization and overall volumes. So it will take up and ramping.

The Phase II study pipeline is for the 16 million tonnes, what we are planning. This is the plans for the entire CapEx to be completed within 2 years, as we mentioned earlier also.

Okay. And then my next question, it is about what would be the revenue growth in terms of volume of iron ore and value-added products for FY '21 and FY '28.

But there is no increase in volume. This is the maximized volume that we have. FY '27, we just discussed, FY '20, our steel plant would be operational fully. So we will be having a production of, say, 1 million tonnes, is 75%, 80% of the capacity. -- plus the parent plant will be producing at 9 million tonnes. So that will be the value-added product range. And relevantly DRI and central produced according to that.

Okay. Okay. And sir, one more, which is also the intersegment revenue in terms of tax in that they were using because after the acquisition, as we can see that intersegment revenue have a ramp up like it was somewhere around 4,000 in this, so what will be for Thriveni get something for FY '27, if you can put some light because captive transfer of INR 907 crores, which we can see the reflection...

I don't think we are ready with that exact figure that you're looking for. We'll come back shortly on that.

The next question is from the line of Vedant Sarda from Nirmal Bang Securities Private Limited.

So we have guided 26 million tonne of iron ore production and double down on pellet reduction and drapes production for FY '27. So can you broadly tell us revenue growth and EBITDA growth for FY '27 on the current realization of iron ore?

I think the figures are all with you. We leave it to the analyst to analyze and confirm the figures.

The next question is from the line of Tanmay Choudhary from Dolat Capital.

Sir, my first question is on the logistics side, like, what is our evacuation plan through the pipeline and the trucks in less lighting and specifically for feeding our recently commenced part plant.

Your question is not very clear, sir. Can you repeat it?

Yes, sir, I'm asking on the evacuation plan through the pipeline and on the transport side, like for feeding our recently coming pellet plant?

So the recently commissioned parent plant is being fed by the pipeline was commissioned around a year back. that same pipeline is now filling both the pet brands that are commissioned. This product is being evacuated either by truck or by -- from a reacting, which is around 80 kilometers, 70 kilometers away. That's as far the election there current credit plant and [indiscernible] the pellet plant. Does that answer the question.

Ladies and gentlemen, we take this as a last question. I now hand the conference over to the management for closing comments.

Thank you, everybody. I guess we were able to reply to all your questions and queries. Once again, thanks, everybody. And if you have any further questions, you can get a second touch with Mr. Chintan Mehta or myself so that we can give you all the further reply. So thank you once again for participating. And thank you Equirus team for hosting us -- thank you, sir.

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