Siyaram Silk Mills Limited ($503811)

Ladies and gentlemen, good day, and welcome to Siyaram Silk Mills Limited Q4 FY '26 Earnings Conference Call. [Operator Instructions]. Please note that this conference is being recorded. I now hand the conference over to Ms. Mamta Nehra from MUFG Intime India Private Limited. Thank you, and over to you, ma'am.

Thank you. Good morning, ladies and gentlemen. I welcome you to the Q4 and FY '26 Earnings Conference Call of Siyaram Silk Mills Limited. To discuss this quarter's performance, we have from the management, Mr. Gaurav Poddar, President and Executive Director; Mr. Ashok Jalan, Senior President and Director; and Mr. Surendra Shetty, Chief Financial Officer; Mr. Dinesh Jaithliya, Vice President, Finance. Before we proceed with the call, I would like to mention that some of the statements made in today's call may be forward-looking nature and may involve risk and uncertainties. For more details, kindly refer to the investor presentation and other filings that can be found on the company's website. Without further ado, I would like to hand over the call to the management for their opening remarks, and then we can open the floor for Q&A. Thank you, and over to you, sir.

Thank you, Mamta. Good morning, and a warm welcome to everyone joining us today for the earnings conference call of Siyaram Silk Mills Limited to discuss the financial results of quarter 4 and full year FY '26. Thank you for taking the time to be with us. I hope you have had the opportunity to review our financial results and investor presentation, which have been uploaded on the stock exchanges and the company website. Siyaram has long carried the spirit of Indian textile across generation establishing itself as a distinguished name in the textile and apparel industry. What began with a strong foundation in fabrics has seamlessly evolved into a diversified fashion and retail presence guided by a vision that embraces change while remaining deeply rooted in tradition. Today, Siyaram continues to strengthen its position through a focus on quality, design and innovation. The brand remains committed to offering thoughtfully crafted collections that cater to the evolving preferences of a wide range of customers. In quarter 4 FY '26, we witnessed a gradual improvement in consumer demand despite a challenging macroeconomic environment and ongoing global uncertainties. Demand remained healthy, supported by income tax relief measures, improving disposable incomes and increased spending during the wedding and festive season, which contributed to improved business performance during the quarter. At the same time, elevated input and logistics costs along with inflationary pressure and evolving geopolitical conditions continue to pose challenges for the industry. Despite these headwinds, Siyaram remain focused on disciplined execution and strengthening its market presence. Our diversified product portfolio, wide distribution network and prudent business approach continue to provide resilience in a dynamic operating environment. As part of our retail expansion strategy, we continue to strengthen our presence through calibrated store additions with total store count reaching 44. 27 in ZECODE and 17 in DEVO. As part of our expansion plans, we intend to reach a total of approximately 70 stores across both ZECODE and DEVO by the end of the coming financial year. Alongside network growth, the company has been actively investing in brand-building initiatives with increased marketing efforts and localized in-store engagements aimed at enhancing consumer connect and driving footfall. We are also pleased to share that the Board of Directors has approved a special interim dividend of INR 4 per equity share and a final dividend of INR 5 per equity share of face value INR 2 each. Taking the total dividend for the financial year '25-'26 INR 16 per equity share. This reflects the company's strong financial position as well as our continued commitment towards creating long-term value for shareholders. In addition, we are happy to announce the commencement of construction of residential project of approximately 77,000 square feet at Dombivli scheduled to begin in June '26 with an estimated development time line of approximately 24 months. This project is a one-off project since we have already have a residential land parcel sitting in the company's balance sheet. In the last financial year, the company has achieved a new milestone of crossing INR 2,500 crores of revenue INR 300 crores of PBT and INR 225 crores of PAT. This performance is in line with the upward revision of growth guidance given in the last financial year. This reflects the strength of our business model disciplined execution and consistent consumer engagement across markets. Going forward, we will continue to expand our retail footprint and strengthen brand visibility in a disciplined manner, while investing in growth initiatives and store expansion our focus remains on driving sustainable growth, improving operational efficiencies and managing healthy margins. Despite ongoing macroeconomic and geopolitical uncertainties we remain confident in the strength of our business and our long-term growth prospects. Thank you for your continued trust and support. I would like to now invite our CFO, Mr. Surendra Shetty, to present the financial highlights.

Thank you, Gauravji. Good morning, everyone. Let me take this through our stand-alone financial performance for the fourth quarter and full year of financial year '26. Our total income for the quarter 4 financial year '26 stood at INR 871 crores compared to INR 750 crores in quarter 4 of financial year '25, reflecting a year-on-year growth of 16.1%. For the full year financial year '26, total income reached INR 2,653 crores, up from INR 2,296 crores in financial year '25, marking a year-on-year growth of 15.5%. Our revenue mix comprised of Fabric at 80%, garments at 15% and others at 5% in the financial year '26. We are pleased to report an EBITDA of INR 152 crores in quarter 4 of financial year '26 compared to INR 125 crores in financial year -- in quarter 4 of financial year '25. The year-on-year growth of 21%. The EBITDA margin for the quarter stood at 17.4%. For the full year financial year '26 EBITDA was INR 413 crores, up from INR 353 crores in the financial year '25 reflecting a 17.1% year-on-year increase with a margin of 15.6%. Profit after tax for the quarter 4 of financial year '26 stood at INR 95 crores, reflecting a strong year-on-year growth of 30.6% with a PAT margin of 10.9%. For the full year financial year '26, PAT was INR 228 crores compared to INR 199 crores in financial year '25, representing a year-on-year growth of 14.8% with a margin of 8.6%. Thank you. That concludes my remarks. We can open the floor for questions.

[Operator Instructions] First question is from the line of Vishvender Singh from Prudent Equity.

Congratulations on a good set of numbers. I had a question on the CapEx side. So can you share the FY '27 CapEx guidance and store count guidance from both of our entities.

So by the end of the year, the CapEx spend looks something like this. So we have about INR 50 crores to INR 60 crores of regular maintenance CapEx that is an annual feature every year. So that is one. And we expect to be at a total count of 70 stores by the end of this year. So we are at 44% right now. So the additional stores, we would allocate about INR 40 crores or so of capital. So that would be about INR 100 crores of CapEx for this real estate project that we are talking about is not part of CapEx, but a part of the cash outflow we estimate a spend of about INR 45-odd crores. So about INR 25 crores will be spent this year and the balance would be probably spent next year. But that's not part of the CapEx as such.

Okay. Got it. And are you looking to increase the EBITDA margin guidance since a large portion of our stores will see some stabilization this year?

So in terms of retail, we are still very new, very few of the stores have crossed 1 year in March, and we are still in a very nascent stage. So in terms of store counts, store numbers and store economics, we are still in a pretty nascent speed. But in terms of the overall business, the business is very healthy and performed well last year. We will continue with our guidance of approximately 14% of EBITDA with the 150 basis points of drop due to retail. But all of this is subject to the global environment at the moment and volatile input prices, which are very dynamic at the moment. So we would wait for some time for it to stabilize to be able to give a better concrete answer. But for the moment, we are positive for the whole year in terms of our growth, and we expect that our normal EBITDA margin of 14% as we guide constantly, we will attempt to achieve.

Got it. And can you comment on the residential project like how much revenue are you targeting the completion time line? And what will be the method to recognize the revenue?

So this construction project is a one-off project, first of all, our business and our company is focused in the textile and fashion industry, and we continue to remain focused in this industry. This project is a one-off project because we have residential land parcel already sitting in the company, and it's not a large project, and that is why the company decided to attempt it itself because it's a smaller project, about 77,000 square foot of buildup area. We estimate to complete this project within 24 months with an expense of about INR 60 crores in total, including the land cost and the revenue estimation would be around INR 80 crores. All these are little inductive numbers. And this is a smaller sized onetime project that we envisage.

Okay. And how will you recognize the revenue, sir?

No, this is as per our development of the project that whenever we collect the money from the parties on the sale, on completion of the project, we will recognize. That's what that...

Is it fair to assume that it is project completion basis?

It will be around 24 months already we said. Within 24 months, we are thinking that it should be completed.

No, I was asking about how will you recognize. So...

Yes. As and when we have completed say, as per the certificate, we are receiving. We will recognize the income.

Okay. So not a lot of the portion of the revenue will be recognized before the 24 months of completion date?

Yes, yes, it will take because on the completion part of the completion, whatever is that to be recognized as per the standard, we will recognize.

Got it. And another question on the export part, you mentioned that some macroeconomic headwinds are still there. So post stabilization, do you expect to increase the share of exports in total revenue? And by how much.

Export right now contributes about 10% of the overall revenue. And if you look at -- for this year, it's about 10%. And if you look at last year also, it is about 9%, 10%. So this has been a stable number over a period of time. While export is a promising business, once things stabilize and FDAs and all come into place, it looks an interesting business, but the base is very small. And our larger domestic business, the base is very large, and that is also growing. And now with retail expansion, all of that is domestic. So it's difficult to give a percentage in terms of what percentage of contribution it will have for the company. But yes, it is a business that will continue to grow.

Next question is from the line of Dixit Doshi from Whitestone Financial.

So you mentioned that when you guide you assume a 1.5% kind of EBITDA margin loss due to the retail operation. Can you provide for FY '26, how much was the sale or how much was the loss for this business?

Yes. So for FY '26, which was the first year that we had a full year of we had estimated a sale of about INR 70 crores to INR 80 crores from this retail business, and we are happy to report that we were able to achieve INR 80 crores of revenue from this retail business. We had indicated a 150 basis point drop in EBITDA due to this, and it was well within that budget, and we were able to do better than our guidance. And so we're very excited about this business moving forward as well.

Okay. So this year also, there was 1.5% EBITDA drop was...

This is what we are guiding because the business is still very new. Some of the stores which are opened are going to mature and it will take some time to mature. And we will be opening new stores as well. So there is going to be a drop in EBITDA. But we want to keep it -- we want to allocate our capital very wisely.

Okay. And can you share some metrics for at least 1 year old store.

It's very difficult because very few of our stores have been 1 year. And in ZECODE, particularly when we started, we started opening smaller sized stores of about 4,000, 5,000 square feet. And since then, as we have said in the previous calls as well, we have seen better response in the larger size stores. So now going forward, we are looking at more of 6,000 to 10,000 average of about 700,000 square feet stores depending on availability. And therefore, it's too early to talk about this, but I'm happy to share that the feedback from the consumer has been very positive in both DEVO and ZECODE. The product has been well appreciated. What we mentioned as the right to win in terms of the knowledge of fabric is being seen through from the feedback of consumers and that is something that we're really pleased about. And we're able to -- consumer is getting the message that we're trying to -- in terms of the product, some of the stores in ZECODE have really performed well in a very short time. Some of them have seen EBITDA positive results before a long period of time. So numbers are very encouraging. The business is very encouraging. And to give more specific numbers, it takes some more time, so where there is an established base so that the numbers remain stable and it's not something that's fluctuating a lot. That is why we need some more time for this business to stabilize.

Okay. And this 26 stores that we are planning this year, that will be all COCO only? Yes.

Yes, so we'll continue with the strategy of opening company stores for this year. We want to -- franchising is an established model. But I believe that once we understand the business model and are able to present a return for an investor only, then we can approach an investor to come in.

Okay. Okay. And my second part is related to other income. So for this financial year, if I see our other income was INR 83 crores, INR 84 crores, of that, we had a INR 21 crore profit on sale of land. And I think the government grant was around INR 5 crores, 6 crores. Was there anything else which was kind of one-off?

Majorly, the major other income, I'll tell you, in that interest received is one part around INR 10 crores. Okay. That is your profit on full year, I'm telling mainly interest around INR 27 crores is a full year interest, then we put it on sale of assets down INR 21 crores. The net market gained on the investment mark-to-market that is INR 12.73 crores and then we have capital subsidy received INR 5. 31 lakhs. So these are the major.

Next question is from the line of Dev Gulwani from Care PMS.

Congratulations on a good set of numbers. Why Q4 had less new store addition is equal in DEVO and on guidance of 20 stores and 15 stores was ZECODE and DEVO respectively, for FY '26 was not achieved. What was the reason?

So you're right, original guidance was of about 35 stores. And when we look at guidance, it's an aggressive number, and it's also something that we look at as a potential that we hope to achieve. As I've been mentioning on the call earlier, this is a new business for us, and we are working with a very lean team. So we don't have an extended team of where there is a separate business development person and a separate -- different teams doing different things. They're working on a very lean startup kind of model where we want to get the business operations right in the beginning. And therefore, business operations has been of a larger focus. Store openings is something that we have to keep doing, particularly in ZECODE because we need volume, and that will continue to happen. One of the main reasons for delays in store openings is because some of the projects that we identified are under construction properties. So our scope of work only start once the development is complete, and then we're able to roll it out and churn out the store very quickly. So most of the delays are related to that. But yes, we have been short of that target, and that is why we are taking a more conservative target this year of about a total of 70 stores, which I'm confident we will achieve.

So 26 new store addition in FY '27 are similar to FY '26 store additions. So Don't you think this is like a low guidance fo store addition in FY '27 and from when we can expect aggressive store expansion.

Yes. See, the company -- these are all company stores that we're opening. So the only constraint is finding a good location. In terms of capital, the company is producing enough cash flow to open stores. So in that sense, you're right that we are not looking at a very aggressive number in store openings. When we have the resources to do that. But the whole idea is that we want to focus on operations, as I mentioned. And for us, business performance is really critical. We are in the first few years of our retail journey, particularly in ZECODE and DEVO. And I believe that these are the foundational years where the business gets established, the model gets established. And for that, we are not very focused on looking at an aggressive number of store openings. We want to focus on business operations. Once we have 3, 4 years of stable business, we understand the model, we correct our models because all these mistakes that everyone will make or we will also make we have to correct them at a smaller scale. Once we are able to prove that model once we get numbers, which we've been getting very encouraging feedback. So once we have that model in place in store expansion is something that is in our control, and we have resources through that. So I'm not worried too much about store expansion. What we are looking at right now is more of getting stability and operational efficiency.

Can you give the split between the 26 new store addition between ZECODE and DEVO.

There are approximately 8 stores of DEVO approximately, and the rest of them are ZECODE.

And how many stores have we opened in the first 45 days of this financial year?

That is an ongoing process. I don't have the exact number with me, but some of the spillover from March have opened in April. We will report the exact number by the end of the quarter. But this is a more annual number. This will not be a number that will happen on a quarterly basis. Because since you mentioned numbers are smaller, we want to focus on seasonal business like Diwali is a big season, so we want to do a large part of stores before Diwali. So similarly, in the next festive season. So both the businesses have their own seasonality, and we want to focus on catching those seasons.

And why are you not targeting any new geography for ZECODe stores?

So we will be looking at new geographies soon. So now in ZECODE, for example, in this year, we will expand our geography from Karnataka to areas around Bangalore. So we will, in this year, look at Chennai and Tamil Nadu as a state, we will look at Hyderabad as a city where we can open some stores and also the south of Maharashtra. Since we have stores in North of Karnataka, we will look at South of Maharashtra as something that we will open. So the basic idea is we want to efficiently use our resources in terms of warehousing and logistics and areas rather than a city-based national approach.

Okay. And sir, the revenue growth guidance for FY '27.

For FY '27, we look at an approximate guidance of about 12% of revenue growth for this coming year.

And last question, sir, any update on the financial issue. It was expected to conclude by end of FY '26.

NCLT's final hearing is already over on 16th of April. They have to pronounce the final order and we are expecting the next date for the order has not been mentioned. We expect that by first week of June, we should get the -- when they will pronounce the order. And thereafter, we will get the order copies. After that, it will take another 3, 4 months to complete the order and issue the RPS.

Next question is from the line of Rajiv from Arcade Investments.

So I just have 2 questions. Firstly, so our FY '26 revenue growth remains strong, despite weak industry demand. So how much of this growth was driven by market share gains, whether the channel inventory buildup, if you could throw some light on that.

Look, the major business is the fabric business and the fabric market is not growing as fast. We have performed much better than the industry. So there is always going to be a market share gain in terms of the traditional distribution growth that we achieved and I just -- the strength of the brand and the connect that we have with our trade has helped us do this. And of course, the seasonal -- season was also very favorable in terms of the wedding market. So largely, it is a market share gain. Obviously, the market grows a small percentage, but there is obviously a market share gain.

Understood, sir. Understood. So our legacy business is in fact a bit. So how is legacy business performing? And could you please speak more about the fabric business? And maybe how sustainable our current gross margin into FY '27?

if you look at the legacy business, this has been a constant growing business. The growth rate remains tend to remain in the high single digit to very low double-digit numbers. And that is what we are even projecting for the coming year. The market growth is smaller, but within the market itself, there are still a lot of unbranded players, which there is a lot of potential to take the market share. In this year, if you see in terms of margin expectation, while we hope to maintain margins, this year, there is a lot of volatility in input prices. Now as a brand, we are able to pass on prices to the consumer, but that happens in a very gradual manner because we also want to make sure that demand is not disrupted and market share keeps growing. So the pass on happens in a gradual manner, and the pricing remains very volatile. So it's difficult to exactly understand until things stabilize and normalize. But for sure, as if prices go up and if overall consumer prices go up, then branded fabrics and branded business becomes even more advantageous than unbranded. So ultimately, the long run looks good. And since this is a cash cow business for the company, we are focused on it and hope and really looking at how we can grow this business. I'm confident of that growth.

Next question is from the line of [indiscernible] from Care PMS.

I just wanted to ask about our inventory and data position, which have increased by 25% this year. Any specific reason for the same?

I think some of that is accredited to the new stores that we're opening, because inventory stands in our books. And rest of it is regular process of -- because we are a make-to-stock company, and we had expected a good quarter 4, and therefore, we are building up inventory for that. So that is why you are able to achieve these numbers. And it's a regular process of managing the inventory going up and down. If you see the inventory days that the company has ended at in March. So due to the increase in sales, it is almost similar to 135-odd 138 days, something like this. So we are still in the range of the same number since last year.

Right, right. Okay. And can you share average revenue per store for stores report stores, which have crossed 1 year mark, can you share those details.

It's still very early. I would refrain from sharing that at the moment. Also, please note that the first few stores in ZECODE that we opened was smaller size. So on average, revenue would be a misleading indicator. And I would really look forward to sharing these numbers once we reach a certain larger number of stores and once some of the stores have stabilized, so that we are able to actually gain a better perspective from those numbers. So that is why we are holding back these numbers and giving you broader indications of business.

And with our retail portion expanding going forward, what kind of ad spend do you see or increase in ad spend do you see going forward?

So we've been indicating a 4% to 5% contribution of ad spend throughout the year, and we would continue to give that kind of guidance. Retail is a very small business still, and we are doing advertising. But since we've followed a clustered approach, we are able to focus really a lot on the customer and creating football and focus as spends on a certain area. So we've been able to do that more efficiently.

And in the coming year with cotton prices, et cetera, expected to go up. Do you see our growth being faster due to higher realization? And also, you mentioned that when prices are higher, branded players are expected to benefit more. So should we see a faster growth in Fabric business in coming years?

Yes. Look, when I talked about branded players getting a benefit, that is a fact, but that is a longer-term play. And that is bound to happen when prices -- when the gap reduces between unbranded and branded. Now in terms of this year when raw material prices increase, of course, as value increases, then there is a direct impact on the top line, but that depends a lot on how much we can pass on to the consumer and how much interval because as a brand, you have to be quite stable. I mean, at a raw material price, it fluctuates up and down very dynamically. Same dynamics cannot be passed on to the consumer at that speed. So that is a more gradual system where prices are passed on to the consumer. And it's too early now to say -- to comment on that question because these are very dynamic at the moment.

Next question is from the line of Suhani Singh from [indiscernible].

I wanted to ask if the consumer demand has improved after the wedding season and GST rationalization? Or is this demand still largely even driven?

Thank you for your question. See, the business that we are in is a seasonal business, which is driven by weddings and festivals. So it follows that season. Now in the last quarter, there were a large number of weddings and that wedding season kicked off really well, and therefore, we were able to take advantage of that demand that was inherently present. And all the other factors associated with it like GST and other things. Now this first quarter generally is the weakest quarter for the company and over and on top of that, there is all these geopolitical issues and raw material issues, heatwaves and so many other things that are impacting. But we don't look at the business as a quarterly business. We look at the guidance and the business as an overall annual business since it follows seasonality. And we are really hopeful that our guidance will be met by the end of the year.

Okay, sir, understood. I wanted to understand at what scale of revenue or store count do you expect the retail business to become consolidated EBITDA positive?

I don't think you're looking at on store count number for that. That is our focus and endeavor every day, as I mentioned, some of the stores in ZECODE have already started showing EBITDA positive numbers. So I mean that is -- we are very early -- in our early days, and we're not looking at reaching a certain soon before being EBITDA positive. That is something that at least -- of course, the overheads and all get divided with the number of stores that opened. So that's a separate issue. At store level wise, it's an ongoing attempt to keep how we can operationally make stores more efficient and get to profitability faster so that we can start an aggressive opening expansion.

One last question. So coming to ZECODE and DEVO, can you please help us know that how is the repeat purchase trends and customer retention is shaping up?

It's been very good, in fact. -- some of the -- I mean in DEVO is a more premium branded kind of a play where it takes a longer time for the consumer to understand the brand and commit to that brand. and we've been very happy that the consumer has given very good feedback in terms of the product, the collection that is available at store, even at such a small scale, we've been able to create an impact into what kind of range that he gets. So the consumer feels that there is a lot of newness in the product that DEVO has to offer in terms of competition, and that is something that is really encouraging for us and repeat purchases and referral purchases have been very strong, and that is something very encouraging for us.

[Operator Instructions] Next follow-up question is from the line of Vishvender Singh from Prudent Equity.

Just wanted to comment on your debt part. So what sort of peak debt are you looking to end with this year, considering the issuance of the preference shares and the store expansion?

So right now, the net debt about INR 40-odd crores. And this is something so the cash flow for the year should spice the expansion plan that we have -- the CapEx plan that we have in place. The RPS issuance this year will not affect the cash flow at all. because shares will be issued, and there will be no other impact in this year. So we -- I think that internal approval should be sufficient to take care of our CapEx, CapEx and other expenses.

Got it. And just on the inventory side. So I see a little bit jump on the inventory as a percentage of revenue. So are we looking something of a purchase delay from the customer side in a retail store.

No. As we open more stores, these stores are all company-owned stores. We have about INR 60 lakhs to INR 7 lakhs of inventory per store. So as we increase the number of stores, inventory sits in our books even though it's in the store, so that addition of inventory does happen in. Some of the stores have seen 2 months, 5 months, 6 months of sale. So the inventory again sale will not justify the numbers, but these are all very early days, as I mentioned. So that is one of the reasons for increase in inventory.

Got it. Just last question on the brand side. So are we looking ahead for similar kind of payout to us in terms of grants and subsidiaries?

I think most of the grants in terms of government brands are completed. About INR 5 crores to INR 6 crores order is pending now. So most of the subsidies that we were supposed to receive have been completed.

Next question is from the line of Soumya Raghuvanshi from Nirvana Capital.

My question was on fast fashion. It is a highly competitive segment with players like Zudio, Westside, Reliance Trends and there are a few international brands, what gives Siyaram confidence that ZECODE can scale up further.

So fast fashion is a very interesting space, and we've been in this space now for about 12 to 15 months and have been really enjoying the space. So one thing I would like to tell you about fast fashion is that within the apparel business, this is the fastest growing part of the business in terms of the industry. So fast fashion is really growing very quickly, particularly on the value side. Now when you look at the size of the market and the opportunity present, it is very huge. So even the larger peers are a very small percentage of the market. So that is one that the market is so huge, and the opportunity is so huge. But I think that the bigger advantage or the right to win when you ask us that what do we see and why should we be in this business is we believe that we are a business that comes from the textile industry, we understand the raw material, the fabrics, the prices, how designing is driven and controlled how product is made and that I feel is the most essential part of this business, how to control product at a reasonable price. Obviously, these things happen at volume, but this is something that we believe is our core strength, which is the product and so far, it's been a very early journey. But in this journey, we've been receiving that kind of feedback where product is differentiated, the quality is being appreciated. The pricing is being appreciated. So all in all, what we attempted to do is something that we are seeing the feedback and that encourages us to grow further and shows us a huge opportunity ahead.

Okay, sir, understood. Now sir, could you specify the growth breakup in the Fabric segment in terms of value growth versus volume growth?

So it's about similar. So in the Fabric business, the volume is about 10% growth value is about 11-odd percent. So in Garment without this new retail business is about 9% volume and about 8% value. So growth has been similar in terms of volume in value.

Next question is from the line of Santosh Shetty from LGC Capital.

So I just wanted to know about the announcement made by the company regarding a residential project in Dombivli. So what is the strategic rationale behind entering this project? And what returns does the management expect from it?

So that's a good question. Thank you. So first of all, this the project company is focused on a textile and fashion business. So at the moment, this real estate and residential is something that is outside the strength of the company. And this is a particular project we envisage and took up because the residential land is already available with the company. And it is a small parcel of land, which with limited size of construction. Now when we look at how to monetize this land the best opportunity in terms of monetizing it was in terms of developing it ourselves because the size of the project is very small. And therefore, we look on this endeavor to complete this project. It is a one-off project. We don't tend to be in the real estate business. This is a project that will take about 24 months. The outlay for this -- the land is already owned by the company. So there is a further about INR 45 crores of outlay that will be entailed and about approximately INR 80 crores kind of revenue potential that over a period of 2 years, we'll be able to garner from this.

Next question is from the line of Varun Mishra from [indiscernible].

Just a question, like, can you share the exports grew materially like in the current quarter around 10% like it was a contribution. So what would we see in the next 3 to 5 years, given the global sourcing shift towards India.

So as I mentioned earlier, it's difficult to look at it as a percentage of contribution to the company in terms of export versus domestic because our domestic business also is growing and retail expansion, which is happening at a much faster pace than the overall company growth is also going to be all domestic driven. So rather than looking like that, I would look at an export growth independently, which we look at the same kind of percentages for now in terms of the overall growth.

And like recent deal, which we signed with New Zealand in terms of the FDA, do you see that helping us in the future?

So FDA and all these treaties are the government signed is always going to help export business. Once these come into play, we have to understand the requirements in pricing in India will become more competitive as a manufacturing nation. So definitely, it is going to help the country as a whole.

[Operator Instructions] Next question is from the line of Rangan an analyst.

Very good set of numbers you have given, no doubt about it. But I find some products which are being advertised are really not available in the market. Please ensure that before aggregation, all these products are available once while I've come to [indiscernible] And regarding the cash flow, I find there is only INR 96 crores, then where is net profit is -- then 77,000 square feet of land is a buildup parent average of INR 10,000 come only INR 80 crores. Maximum realization will be about INR 20 crores or something like that over a period of 3 years. Am I right at that. And in land parcel. Would that be -- that question.

Yes. For the first part of your question of availability, we'll contact you separately and understand what you're trying to say and work on it as per your suggestion. Now in terms of the land parcel in, this is about 77,000 of buildup area and I think the carpet is going to be lesser. So the revenue potential is estimated at INR 80 crores. We have to really work out and see how -- what this number actually is, but we estimate it to be at about INR 80 crores. And therefore, there's a gain of about INR 20 crores, which will be not in 3 years, but in 2 years. So 24 months is an outer limit of how we perceive this construction to be. And there is an idle land at the moment for the company. So this is what the company find is the best way to monetize this land and generate profit out of this. In terms of cash flow, there has been operating net cash flow of about INR 150-odd crores. And the large part of the cash flow this time has gone into inventory and debtors, which is something that at a period of time that comes in, much was a very good quarter, and therefore, letters carry forward into the next month. And as I mentioned earlier, there is this retail expansion, which increases inventory a certain extent because the inventory stands on the books of the company.

Thank you. Ladies and gentlemen, due to time constraints, we'll take that as a last question. I now hand the conference over to Ms. Mamta Nehra for closing comments.

Thank you. I would like to thank the management for taking the time out for this conference call today and also thank all the participants. If you have any queries, please feel free to contact us. We are MUFG Intime India Private Limited, Investor Relations advisers to Siyaram Silk Mills Limited. Thank you. Thank you so much.

Thank you very much. On behalf of MUFG Intime India Private Limited and Siyaram Silk Mills Limited, that concludes this conference. Thank you for joining us, and you may now disconnect your lines. Thank you.