Pondy Oxides and Chemicals Ltd (BSE: 532626) Q1 2026 Earnings Call dated Jul. 25, 2025
Corporate Participants:
Unidentified Speaker
Ashish Bansal — Managing Director
Vijay Balakrishnan — Chief Financial Officer
Analysts:
Unidentified Participant
Sakshi Narvekar — Analyst
Rahil Shah — Analyst
Sagar Shah — Analyst
Shweta Dikshit — Analyst
Sakshi Goenka — Analyst
Khush Gosrani — Analyst
Siddharth Malhotra — Analyst
Naman Parmar — Analyst
Sanjay H. Parekh — Analyst
Vaishnavi Gurung — Analyst
Gopinath — Analyst
Presentation:
operator
Ladies and gentlemen, good day and welcome to the Pondy oxides and Chemicals Limited Q1FY26 earnings conference call hosted by Goindia Advisors. As a reminder, all participant lines will be in the listen only mode and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing Star then zero on your touch tone phone. Please note that this conference is being recorded. I now hand over the call to Sakshi Narwekar from GO India. Thank you and over to you.
Sakshi Narvekar — Analyst
Good afternoon everyone and welcome to Pond Dioxide Sun Chemicals Limited earnings call to discuss Q1FY26 financial performance. We have on the call Mr. Ashish Bansal, Managing Director, Mr. K. Kumar Reval, Director Finance and Company Secretary, Mr. R.S. vaidyanathan, Executive Director and Mr. Vijay Balakrishnan, Chief Financial Officer. We must remind you that the discussion on today’s call may include certain forward looking statements and must therefore be viewed in conjunction with the risk that the company may face. May I now request Mr. Ashish Bansal to take us through the company’s business outlook and financial highlights after which we will open the floor for Q and A.
Thank you. And over to you sir.
Ashish Bansal — Managing Director
Thank you, Sana. Good afternoon ladies and gentlemen and welcome to our Q1 FY26 earnings call. I trust you have had the opportunity to review the earnings presentation, press release and financial results that were uploaded on the stock exchanges. I will guide you through the results after which we will have a question answer session. I’m delighted to announce that POCL has kicked off FY26 with its best ever quarterly performance driven by robust operational execution. On a year on year over basis, revenue EBITDA and PAT have grown by 36%, 82% and and 90% respectively. We’ve achieved record high EBITDA and PAT margins of over 7% and 4.5% reflecting our increased emphasis on value added products and enhanced operational efficiency.
Before we delve into operational and financial highlights, I’d like to begin with key strategic updates. Capacity Expansion Update USCL is undertaking a two phase expansion of its lead production capacity at the Teruai Kandigai plant, adding a total of 72,000 tons per annum, 36,000 metric tons in each phase. Commercial production of phase one of 36,000 metric tons per annum commenced in Q1 FY26 with the plant operating at approximately 40 to 45% capacity utilization during the quarter. This is expected to increase to around 70% in the upcoming quarters. Phase two of expansion is scheduled for commissioning in the second half of FY26 with an estimated capital expenditure of approximately rupees 20 crores.
POCL invested rupees 8 crores in capex during QI FY26 and plans to invest an additional of rupees 42 crores over the remaining nine months of FY26. POCL is looking at setting up R and D facilities for the creation of value added products both for current portfolio and for feasible products which will add overall value to the top and bottom line of the company. Coming to the operational performance, the yearly procurement mix of lead, plastics and copper through imports is approximately 84%, 53% and 100% respectively. Capacity utilization of copper more than doubled leading to a significant increase in production and sales of copper.
The production and sales of lead has increased significantly by 17% and 9% to 24,167 metric tonnes and 22,530 metric tonnes on year. On year basis. EBITDA per tonne of lead increased significantly by 48% to rupees 16,898 per tonne on year on year basis. Moving to our financial results for Q1FY26, I would like to reiterate that POSL has achieved highest ever quarterly revenue EBITDA pat and margins. Revenue from operations has increased to Rs. 596 crores up 36% and 15% on year. On year and Q on Q basis. POCL experienced this substantial growth as a result of increased production, sales and realizations in both lead and copper.
The Q1 FY26 sales mix between domestic and exports markets stood at 44% domestic and 56% exports respectively. The percentage of value added products in lead segments stands at 71% compared to 50% and 58% on year. On year. On Q basis, EBITDA increased significantly by 82% to rupees 43 crores on year. On year basis, EBITDA margins exceeding the 7% mark represent a significant milestone in POCL’s journey towards long term sustainable value creation. This increase is due to increased sale of value added products and operational efficiencies. PAT increased by 90% to INR 28 crores on year. On year basis, PAT margins increased to 4.6% up from 3.3% in Q1FY25 on a consolidated basis.
Also, POCL reported a strong financial performance. Revenue from operations, EBITDA and PAT increased by 35%, 78%, 94% respectively, year on year basis. In conclusion, POCL is firmly on track to achieve its long term strategic objectives for 2030 with a clear roadmap centered on value creation and sustainable growth. We are aggressively scaling our lead production capabilities while expanding into adjacent non ferrous verticals. Targeting over 15% value growth, a revenue CAGR and profitability growth of 20% plus. These gains will be accompanied by meaningful margin expansion with a focus on achieving ebitda margins above 8% and ROCE greater than 20%.
Our strategy is not only growth oriented but also deeply aligned with sustainability imperatives. We are working towards generating over 60% of revenue from higher margin value added products while targeting a 20% plus reduction in energy consumption, reinforcing a commitment to operational efficiency and environmental responsibility. With strong capacity expansion and progress, prudent capital deployment, operational excellence regularly tailwinds and direction of a seasoned leadership team. POCL is well equipped for sustainable long term value creation. Supported by the continued trust of our stakeholders, we remain confident in our journey towards a more innovative, responsible and profitable future. That concludes my update and I’d like to open the floor for questions.
Thank you.
Questions and Answers:
operator
Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press STAR and one on their touchstone telephone. If you wish to remove yourself from the question queue, you may press STAR and two participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Rahul from Crown Capital. Please go ahead.
Rahil Shah
Hello. Can you hear me, sir?
Ashish Bansal
Yes, you’re clear.
Rahil Shah
Yes. Yes. Hi, good afternoon. So, just one question on these margins. So by 2030 you’re saying you’re targeting 8% EBITDA margins. Correct. Whereas in this quarter one itself you achieved 7%. And if I remember correctly, in the previous call quarter four, FY25, you had said FY26. You can expect 6% margins for the year. So when you’re already achieving 7%, first of all, will they continue for the next of the quarters? And why such a low target then for 2030.
Ashish Bansal
Definitely the margins will continue and remain over 7%. And with the addition of value added products and all of this as a blended margin overall we are looking at 8%. And as we add on our more value added products, maybe we will look at our margin profiles. But as of now the guidance that we have provided is around 8%.
Rahil Shah
Yes, you have given 8% but so just why just like a 100 basis point improvement in the next three, four years, can’t it be more than that?
Ashish Bansal
That could be a possibility. But as of now how we are looking at it with blended products and multiple portfolios coming in, we would like to look at it in this manner.
Rahil Shah
Okay. But for this year, 7% overall full year we can definitely expect.
Ashish Bansal
Yes, we’ll definitely continue. Yes.
Rahil Shah
Okay. Okay, I’ll fall back. Thank you. Thank you and all the best.
operator
Thank you. The next question is from the line of Sagar Shah from Spark Capital. Please go ahead.
Sagar Shah
First of all, congratulations to the management team of Pond Dioxide and for an amazing performance in Q1 to begin with first my first question, sir was related to a follow up question. Actually compared to the previous participant on the margins, the margins that were, I noticed the margins were quite actually led by the lead segment in this quarter as well. Because in the plastic segment we are in a bit, a bit loss and still copper, although the utilization has actually increased, almost doubled as you, as you highlighted in the opening commentary. But the lead margins have expanded.
So I wanted to understand two things behind that is the lead margins because of the drop in the, the lead prices that we saw in the preceding quarter. So that’s why are we seeing some sort of an inventory impact due to that? Or maybe, or is it just purely operating leverage that we are actually carrying through in this quarter that we are enjoying such a healthy margins and that’s that too so early. Actually just in the first quarter, just the capacity has just started. So that is my first question, sir.
Ashish Bansal
Yes, thank you for your question. See regarding the copper margins, as you said, the copper is a product that we just started and as we are also looking at further other products, copper margins will continue to improve as we go on adding products and this is the initial part of the manufacturing. Hence as you are aware, slowly the efficiencies will start coming in and the process will be also more efficient and the margins will margin profile will improve. As far as lead is concerned, it is nothing to do with inventory overhang or anything because our inventories, our positions are all completely hedged and we work on a back to back model.
The main increase in margins is one due to our operational efficiencies. We have in the whole of last financial year we had done a lot of modifications in our processes. Used more efficient, you know kind of systems, furnaces and you know all of those lot of changes and additions have been done. Apart from that also if you look at our sales profile the value added products that were sold in this first quarter was on a higher quantum. So these have what contributed to the lead margins.
Sagar Shah
Okay. Okay, fine sir. So can you. You already highlighted that we are running at almost 40 to 45% capacity utilization in this quarter as far as the new plant is concerned. But can you highlight what is the utilization of the existing capacity which is at 31 lakh 32 thousand tons that we already have. What is was the utilization in that segment or in that capacity? Sir.
Ashish Bansal
So the existing plants are running in excess of about close to 70% as far as melting capacity. Smelting capacities are running at 90% plus and overall at 70%.
Sagar Shah
Okay. Okay, fine sir. So my next question was related to the copper. In related in relation to copper actually we were eyeing some forward integration products. We were actually adding some other value added products for new clients actually. So any update, any update on the progress? Actually that what are you eyeing in that segment? What kind of response have you got from your customers so that your copper segment and can be enhanced on your contribution for lead to come down which is your actual overall guidance. So any progress on that segment?
Ashish Bansal
Sir, the progress is continually happening. And as and when we have we will definitely let all our shareholders know through a public announcement.
Sagar Shah
Okay. Okay fine. So I just have some one or two data keeping questions. First of all thank you for keeping for giving the segmentation of revenue as per the. As per the product wise. And secondly I wanted to ask what are the volume figures for copper, plastics and if any aluminium we have produced in this quarter.
Vijay Balakrishnan
Hi Sagat, this is Vijay. So with respect to lead, the volume for this quarter is about 22,530 metric tons. Copper is about 1007 metric tons and plastics about 808 metric tons.
Sagar Shah
Plastics was 808 metric tons. Okay. Okay. And any updates sir on the plastics that what is the reason behind that? We are running an EBIT a bit loss in that segment. And how do you see that segment going ahead in the rest of the year? Will we become profitable and how are we exploring something in the new products there?
Vijay Balakrishnan
Yeah, actually in plastic segment we are at present we Are running in the leased premises now we are planning to move to our own premises where we have sufficient land bank and structures. We are planning to do some restructuring of moving most of this EBITDA and slight EBITDA positive other administrative loss is causing the overall net loss. The rent. We want to stop it already we have given vacation notice. So probably from the next quarter onwards that rent, a substantial amount of rent will be saved and we move to our own premises. Then automatically that segment will come to the positive.
Sagar Shah
Okay? Okay, fine sir, fine. Thank you so much. Yes, sir.
Vijay Balakrishnan
We are getting EBITDA margin on plastics because of this administrative overhead net. It is coming negative. Otherwise it’s a EBITDA positive only.
Sagar Shah
Okay, so basically that is just because of the overheads and the kind of admin expenses that you are facing. But otherwise it’s an ebit a positive business that you pull through.
Vijay Balakrishnan
Yes.
Sagar Shah
Okay, fine. Thank you so much and all the best for the following.
operator
Thank you. The next question is from the line of Shweta Dixon from Systematics Group. Please go ahead.
Shweta Dikshit
Hi, good afternoon. Thank you for the opportunity and congratulations on a good set of numbers. My first question would be on the aluminium segment. Any update since we were evaluating different product profile for aluminum. So any update on that? Because we were expecting to start generating revenues for it to contribute into profitability this year.
Ashish Bansal
Yes. Hi Shweta. Thank you. Yes, it is in progress and we will have some numbers on the aluminium segment in this second quarter and the work is in progress for the same as updated earlier. There is a slight delay on that. But in the second quarter you will start seeing the numbers.
Shweta Dikshit
Any update on the product that we were evaluating since we are moving away from the existing or the product profile also. So any color on the kind what kind of aluminium products we’re looking at now?
Ashish Bansal
We’ll keep you updated. They are linked products to our existing products and we’ll keep you specifically updated on the product line as we complete the evaluation. Yes.
Shweta Dikshit
And so on. Now coming back to the existing business where we’ve made upwards of 7% margin profile and considering that the new plant at TKD has achieved only 40 to 45% capacity utilization and that plant being more operationally efficient and reduce manpower cost and everything. And we are expecting 70, 75% capacity utilization in Turkey when that will of course naturally go up reach peak utilization subsequently. And why are we not guiding for margins higher than 7% or, or is there any impact which we don’t, we don’t see coming in from the existing operations I’m trying to understand the stable EBITDA margin level for the existing operations that we can see for the rest of the year and why not higher than this.
Ashish Bansal
Being a new plant the product definitely is manufactured and commercial sales also has commenced from this plant. But however as you know to scale up the complete capacity there are little approvals and other formalities that are being done with our customers. And as we speak now we have quite a few approvals and that is the reason why we are saying that we will be ramping up from 40 45% to 70%. And definitely as spoken earlier our margin guidance will be in the range of 7% plus on average for the whole year.
Shweta Dikshit
Last few questions on the bookkeeping side, what is the cash on your books as of now and what is the net, what is the gross debt level now?
Vijay Balakrishnan
So the cash at bank as of today is about 52 crores. This comprises of both the PYP money which is pending to be utilized as well as the warrant proceeds which you have received during this quarter. The overall debt in our books of accounts as of 30 June is about 122 crores. So net debt number. Yes, it is less than. The net debt is less than 100 crores.
Shweta Dikshit
And could you repeat what’s the CAPEX plan for the rest? CAPEX number was the for the remaining nine months and what it was in the first quarter.
Ashish Bansal
For the remaining nine months you’re looking at about 42 crores of capex approximately and we’ve already in the quarter one we’ve already done a CapEx about 8 crores.
Vijay Balakrishnan
This is excluding our tiruaikandihe plant utilization.
Ashish Bansal
That was already done of 75 approximately 75 crores which was completed.
Shweta Dikshit
So this 8 crore went towards phase 2 of the TKDB.
Ashish Bansal
Yes, partially towards phase 2. Yes.
Shweta Dikshit
And any update on any plans for.
Ashish Bansal
As you discussed earlier once this plan is complete we are also looking at a copper project and multiple other projects and in the next financial year we’ll be looking at the Mundarar part of it.
Shweta Dikshit
Thank you.
Ashish Bansal
Thank you.
operator
Thank you. The next question is from the line of Sakshi Goyanka from Soham Asset Management. Please go ahead.
Sakshi Goenka
Hi, am I audible?
Ashish Bansal
Yes you are. Please.
Sakshi Goenka
Yes. Hi sir. Congratulations for the great set of numbers. Just quickly continuing on the previous participants questions. I just wanted to understand out of the the EBITDA per ton which we have posted for lead16900 you alluded that you know there were opportunistic value added product Sales and operating efficiencies coming through. But if I exclude the. What could be. What I’m trying to understand is what could be a sustainable EBITDA per ton taking into account that the new plant is more efficient, we have generally done ebitda in the 11,000 to 12,000 range. I believe that will see a step jump because of the new plant.
But obviously this quarter had some value added means. But what could be a sustainable EBITDA per tonsor? Any color around that?
Ashish Bansal
Yes. So as guided earlier during this call as well Sakshi, our minimum levels that we are looking at for this year on average basis will be in excess of 7%. Though this quarter we’ve had 8% as told we’ve had some opportunity to have a good high share of value added products but definitely that is not going to drop in the next few quarters. And on a conservative level we speak as 7% plus.
Sakshi Goenka
Got it, got it. So and so this year, obviously next year is there any scope for further efficiency gains? Assuming that the new plant, our phase one will be operating at 70% this year and in second half we will see phase two coming. So will operating efficiencies continue into next year also? So can we see better margins next year?
Ashish Bansal
The focus of the company always remains year on year to achieve higher operational efficiencies. But definitely the company is not going to be over optimistic and start guiding towards higher numbers and try to make the market more acceptable towards that. So as you’ve seen in the past as well, we’ve always been conservative in our numbers and we continue to be. However, as you see 7% margin for this year guidance we will continue to do and we are continually working on our operational efficiencies which definitely will reflect back onto numbers year on year.
Sakshi Goenka
Got it. And just quickly existing plant has melting capacity of 90,000. From what I understand and the two phases that is about 72,000. So that’s roughly 160,000 tons of capacity on this capacity. What can be the maximum capacity utilization in. I just want to understand what can be a FY27 kind of volume if we operate at, you know, maximum capacity.
Ashish Bansal
This the current financial, the current financial year we are targeting at operating at about in excess of 120,000 tons of capacity.
Sakshi Goenka
I mean yes, I was talking about more like 27 with both the plants in and our existing smelting capacity of 90 plus the two plants adding up to 72. So that’s roughly 160. So working on 160, what can be a max capacity Utilization can it be 90%?
Ashish Bansal
Generally we always aim for 90%, but however, you know, 80% plus on the smelting side is a good capacity.
Sakshi Goenka
Okay, sir. Sure, sir. Thank you so much, sir.
Ashish Bansal
Thank you.
operator
Thank you. The next question is from the line of Jigar Jani from Nuama PCG Research. Please go ahead.
Unidentified Participant
Yeah, hi sir. Thanks for taking my question. There’s two questions. Just a clarification. So your smelting capacity is 90,000 tons on lead, right?
Ashish Bansal
In our existing two plants, our capacity is 90,000 tons, approximately 90 to 93,000 tons. And with the addition of our new plant, we will be adding in two phases, 36 plus 10. So approximately it goes in over 160,000 tons.
Unidentified Participant
Okay. Okay. So on the first plant, which is you, you have already added that which has come online.
Ashish Bansal
Yes. The first is already online. Yes.
Unidentified Participant
Okay. Okay. On this margin front again, sorry about harping that again on this. So what is the products that have seen or what can you just throw some more light on what are these value added products that have given you better margins and realizations this quarter? And do you feel that these are sustainable levels of these value added products? Because I believe some anti money LED alloys have seen some spikes over the last six months or so. So do you feel it is sustainable and whether it is this, these kind of lead alloys that have led to higher margins for us?
Ashish Bansal
o as we have also highlighted earlier, POCL is one of the largest specialized alloys, lead alloys manufacturer in India and we continue to hold that position and we manufacture certain specific alloys for customers which have given us these margins. And as you rightly highlighted, antimony alloy. Antimony alloy has been already there at a better margin levels over the last six to eight months. So that, that is not the specific reason for this quarter, the quarter’s numbers going up, but rather our other value added specific alloys that we manufacture for certain international customers and domestic customer is what has given us a margin.
And going forward as well, this will continue.
Unidentified Participant
Okay, understood, sir. Thank you so much for answering. Best of luck, sir.
operator
Thank you. Ladies and gentlemen, in order to ensure that the management is able to address questions from all participants in the conference, please limit your questions to two per participant. Should you have a follow up question, we would request you to rejoin the queue. Thank you. The next question is from the line of Khush Gosrani from Incred Asset Management. Please go ahead.
Khush Gosrani
Yeah, hi. Thank you for the opportunity and congratulations on the good set of numbers. My question must have been answered just one thing. On the copper side at Peak utilization, what kind of revenues we can generate and what kind of EBITDA margins we will be able to do assuming today’s pricing.
Ashish Bansal
So at with the current capacity that we have at the peak utilization it could be the revenues could be around 650 to 700 crores on copper in terms of approximately somewhere around 1012,000 tonnes of capacity. And currently, I mean as what we are doing right now, about 4 to 4.5% levels of margin is what we are looking at which will be announced as we add some forward integrated value products.
Khush Gosrani
Got it sir, got it. And any update on the EPR flow through where it is stuck somewhere. I. It was stuck. So any progress on that front?
Vijay Balakrishnan
EPR already we registered with started taking credit of as a lead, dual as plastics.
Ashish Bansal
We haven’t sold any credits as of now but we have them in our books.
Khush Gosrani
Okay, got it. Got it. So any plans when you start selling or is the pricing not correct or not feasible?
Ashish Bansal
Right now, the market is not yet 100% mature and as the penalties start kicking in is when the value of the eprs would be better.
operator
Sure. Got it. Got it. Thank you. I’ll get back in the queue. Thank you.
operator
Thank you. The next question is from the line of Siddharth Malhotra from Kotak Securities. Please go ahead.
Siddharth Malhotra
Thanks for the opportunity sir. And congrats for a good set of numbers. Sir, sorry to harback again on the EBITDA margin question but can you sort of just explain to us what exactly is this VAP share which we are selling about? Because it seems our fundamental margin profile has changed this quarter. I mean if you see at the margins from almost 5, 5 and a half percent we are almost jumping to 7%. This is an increase of more than 20, 25%. I mean what changed in one quarter which led to this fantastic performance? Can you just sort of give us more color into it?
Ashish Bansal
Yes, good question. Definitely. I would love to answer this. See the margin jump is not specifically in this quarter. Any specific change that has happened. We’ve indicated in the last couple of earning calls as well that we are in the process of increasing our efficiency. So increasing in efficiency is not an overnight process. The increase in efficiency could be due to various changes in processes. So a lot of R and D is being done on that. Could be in terms of power efficiency, fuel efficiencies, how the furnaces operate, the overall structure, the overall layouts and the whole product profile mix, how they are blended, what products need to be taken up more aggressively, what products need to be dropped.
So it’s a complete blend of of all the working that has been done in the last two, three quarters that has been going on in our plants in a silent manner. And as those projects got completed, you would have seen a little jump in the previous quarter. And you see also the whole numbers coming into play in this quarter. And that is how we are extremely confident that the following quarters also will be in symptoms levels.
Siddharth Malhotra
Okay. When you also. Sir, yes sir, please continue.
Ashish Bansal
Yeah, and apart from this, a certain percentage of our margins also come, as I indicated earlier, that we’ve concentrated more on value added specific products. So those products are concentrated on and the sale on those validated products also were increased.
Siddharth Malhotra
Okay. Sir, just a follow up. Say for example, if your margin increase, let’s say approximately what proportion of this total increase was due to a higher share of VAP versus efficiency gain?
Ashish Bansal
Sir, so about one to one and a half percent is based on efficiency that has been gained about close to in the race. Yeah, I’m giving us a slight range because I cannot put a exact specific digit, point, digit number. So 1 to 1.5% is in terms of efficiencies and about half to 1% in terms of the specialized product, the specific value added products that we’ve been manufacturing.
Siddharth Malhotra
Understood, sir. And when it comes to us for new capacities, the 36 KTPA capacities, assuming that these capacities are yet to fully ramp up. So obviously your operating fixed operating cost would not be totally absorbed. So fair to assume that some amount of margin expansion is definitely on the card from these capacities as well, say by the end of the year.
Ashish Bansal
Sir, as basic thumb rule of economics, it would be fair to say that because fixed cost will get absorbed, so that has to contribute back. But I will leave it to that.
Siddharth Malhotra
Okay. Okay, so just one last question on this. Any particular sort of, Was there any sort of particular alloys which were not there in the base quarter, for example, which contributed to this 50, 60B improvement which you were referring to earlier?
Ashish Bansal
Yes, there were some alloys that were under the development stage which we started supplying in this first quarter and that has definitely helped us in margin expansions.
Siddharth Malhotra
Any chance for any chance you could give us more color on what these alloys are?
Ashish Bansal
Who are the other people who manufacture? Yeah, we have NDA with our customers, so I don’t think I might be able to give too much of information on that.
Siddharth Malhotra
Okay, sir, just who are these customers or only, only sectors, not specific names, if that is possible.
Ashish Bansal
These, these are mainly international customers.
Siddharth Malhotra
Okay, thank you. Thank you, sir. Thank You.
operator
Thank you. The next question, it’s from the line of Naman Parmar from Nivesha Investments. Please go ahead.
Naman Parmar
Yeah, good afternoon sir. Thank you so much for the opportunity. So firstly on the lithium ion side, what is your update? Because in previous quarter you were telling to shifting towards from lead to lithium ion.
Ashish Bansal
Repeat your question please. I’m sorry.
Naman Parmar
Yeah, so I was just asking about what’s the update on the lithium ion side you were telling you are going to under the lithium ion side acquisition. So any update on that side? Yeah.
Ashish Bansal
Hi. We are currently in discussion with many of our technological partners in terms of identifying the chemistry because there is this industry is quite fast moving, I’m sure. I mean it started, you know, with the NMC and LFP and LMFP and now there are a lot of technologies that are coming up now and we really wanted to. We don’t want to be in a hurry and do something and then later repent. So we thought we’ll wait and understand the industry quite well and once it matures to a level where because the feedstock is very important and currently the only the LFP is the 70% of the market is using LFP as the technology now.
So probably over a period of time, in next a few months we will settle down on a particular chemistry and a particular technology with a technological partner. Then we will go ahead on this. That’s the thought we have currently.
Naman Parmar
Okay, yeah. And secondly on the copper side, if we see in the current quarter, even at a very initial stage, you have done around 3.5% of the EBITDA margin, right. And you are guiding on a console basis you can do a 7% on the whole year basis. But on a sustainable basis how much margin is possible on the copper side and how the capacity ramp up will be going on. Because just asking. Because if you see on the aluminum side initially when you entered the aluminium side it was a very good business, right. But after a very high volatility on that side it become very hard for us to increase the capacity utilization on the aluminum. So it is not similar to that in copper also that if the volatility increases there there can be a margin pressure also.
Ashish Bansal
Let me explain to you coming I’ll go a little forward and then come back for to your question. Coming to the aluminium part of it. I would like to explain that aluminium business was a business where you could not hedge your raw material and you could not, you know, concentrate and fix your margins on the product. If you see the metal part of it, any and Every metal is volatile and the maximum movement that happens on a metal is copper because that is the main, the most liquid metal on the whole index. So it would not be right to say that once copper becomes volatile the margins will go up because copper has and always been the most volatile metal.
But the only advantage over aluminum that we have in copper is copper is a product where your raw material versus your sales can be hedged in a proper sense and you can, you know, safeguard your margins on the product. And going forward in copper we are looking at growing our volumes and looking at the margin in the current year we’re looking at a margin of close to 4 to 4.5% and we are extremely confident on that. So it will not be right to be comparing aluminium and copper as similar products.
Naman Parmar
Okay, understood. And lastly on the capacity of the copper only it was I think around 6,000. You are going to ramp up to 9,000 to 12,000. So it is, it will be live by how much?
Ashish Bansal
I didn’t get you. So it will be live by.
Naman Parmar
It will live in which time means in second half or in FY27.
Ashish Bansal
So in this year we are looking at achieving, you know, the, the capacity is what we have about 90 existing capacity, 90% utilization. And by next financial year we’ll, the additional capacity will also be live and will be utilized. Okay.
Naman Parmar
Okay. And on the lead side, what the optimal utilization can we achieve?
Ashish Bansal
Can achieve an utilization of approximately 80%.
Naman Parmar
Okay. 80%. Yeah. Okay, that’s it. Thank you so much. Yeah. Okay. Thank you sir.
Ashish Bansal
Thank you.
operator
Thank you. Before we take the next question, I will request participants to limit your questions to two per participant and you can rejoin the queue for follow up questions. The next question is from the line of Sanjay Parek from Soham Asset Managers Private Limited. Please go ahead.
Sanjay H. Parekh
Yeah, congratulations. My first question was, you know, this is a very fragmented industry. So do you plan to do any acquisition.
Ashish Bansal
Sorry to interrupt you, your voice is unclean breaking. Could you please repeat the question, sir?
Sanjay H. Parekh
Okay. No, so the first. Now you can hear me?
Ashish Bansal
Yes, that’s clear. Yes.
Sanjay H. Parekh
Okay. So the, because the industry is fragmented, there is unorganized sector. So would you look at consolidating through acquisitions. Small, small acquisitions ahead. That’s the first question. Second is, you know, you clearly are in a growth phase. So while what is visible to us is, you know, more like 25, 2600 crore turnover this year and then 3587 and then potentially going to 5000 crores maybe over next two years after that. So in the growth phase. The question I have is one is the supply side capacity creation. So one is the expansion, current expansion and then the Mundra expansion.
So how do you think about it? Once you plan Mundra, when can you commission it? So the constraint would that be a supply side or the sourcing of scrap? When you, let’s say you want to hit a scale of 5000 crores, would sourcing of scrap be a challenge to you? And the last question is, are there rules world over where there’s a clampdown of export of scrap from their own country outside because they want their own environment norms to get better. So that is a little bit your thoughts would help. So these are my questions.
Vijay Balakrishnan
Hi Sanjay sir, Vijay from Vijay speaking. So see right now as we have already promised, we have started phase one. So next we wanted to start phase two which is going to happen in the second quarter of this year. Once the phase two gets stabilized and the entire lead operation starts then as we already planned we will start the copper also. Copper everything, all the discussion phase and all over. And we will start putting the. We will start the forward integration of copper in the last third quarter of this year and by FY 2027, first quarter we’ll start the operations in the copper.
So on a phased manner. First we wanted to focus on one vertical, complete it, stabilize it, let make it on autopilot mode. Then we focus on copper. Once that also is a product for us, then for forward integration we wanted to move on and slowly once these two verticals are being done then we will start focusing on Mundra also.
Ashish Bansal
As you rightly asked the question about small acquisitions, we are not looking at these small acquisitions of other companies. Because right now the kind of technology that we have installed in our plant is one of its kind in India and I will say probably one of its kind globally also with our new LED operation. And none of the other plants do have that efficiency nor do have that kind of processes and machinery available. So definitely we are not going to take a step backwards to acquire any of these small companies who are not efficient in production and would not make sense for us to acquire a small company and re establish the whole system and equipments.
Rather we would be organically doing it internally converting our existing plants going forward to make it more and more efficient.
Vijay Balakrishnan
We have to buy.
Ashish Bansal
That makes no sense.
Vijay Balakrishnan
Makes no sense. We have sufficient real estate in our city.
Sanjay H. Parekh
Perfect, perfect, perfect. And on the as you get scale, the scrap sourcing and globally are there any norms to restrict scrap sales from those countries?
Ashish Bansal
Yeah, Definitely. I just saying there are talks about the same happening, but also we need to understand that globally, countries who are talking about, about these are again still talking in excess of a couple of years ahead when they would start. But the point is they themselves also realize they do not have the capacities and capabilities to recycle those crap within their own country. Their generations are much, way, much higher than what they can consume internally. So as of now, we do not look at it. And also as India is becoming more organized in terms of the way the disposals are happening, the domestic availability also is on an incremental side.
So I mean all of these put together, I mean the whole thing has been weighed and balanced and seen. So we do not see there could be little tightness in the supply. But again, it all depends on your procurement efficiencies, where, you know what is your kind of network where you can source the scrap and all of these put together further also with our government becoming more and more tight in terms of disposal, so the domestic scrap which was going out to the unorganized sector is flowing back into the organized sector. All of this is balancing the supply side as well.
Sanjay H. Parekh
So we do not see a big challenge as we scale up to maybe 3,500 5,000 crores in sourcing of scrap. That will not be a big challenge.
Ashish Bansal
Yeah, so it’s not just a single product. When we are scaling up, we are not scaling up only on a single product. We are not scaling up only on lead. Lead definitely is the last part of our portfolio. Copper is coming in and there are a few other products that we are working on will also start coming in. So it’s going to be, the revenues are going to be a blend of all these products together.
Sanjay H. Parekh
Perfect. No, no, great. Very, very helpful. The last one in the lithium ion, if at all you finalize on the technology piece, technology front, what would be the capex that you need to do for that?
Ashish Bansal
It will be incremental capex because right now the volumes are so, so low. So I mean the capex right now it’s difficult for us to estimate the capex because there are multiple processing capabilities that are being looked upon. There can be high capex, low capex, but the idea, the thing is to see what kind of scrap generally is available in the market and what is the technology that needs to be used. It will be a little too early for us to estimate on the CAPEX side at this point in time.
Sanjay H. Parekh
And the last one on this regulatory front, you know, there are several tailwinds that when we met you’d explained us, but how is the implementation in India? Is it enforced bw, BMR or reverse GST or you know, ep, emr? So all these regulations are there enforced now properly so that it helps us or it’s still work in progress.
Ashish Bansal
So BWMR is being enforced and the only part now that is the, I mean the notifications are, the only part that is left is the penalization part of it which is, you know, right now the industry stakeholders are opposing that because of course they do not want to get into the penalization part. But consciously they are all completing their requirements that are needed for the BWMR year on year target they are already meeting before even the penalization happening. So that part of it is going ahead. In terms of the reverse charge mechanism, it has been notified, but reverse charge mechanism currently has not had a great impact on the supply chain side.
In fact, the GST reduction and few of the other topics that are being taken up with the GST council that the industry is working on. So we see that in this year, shortly within this calendar year, there should be a good change in that as well.
Sanjay H. Parekh
Great. Best of luck and phenomenal result. Thank you very much.
Ashish Bansal
Thank you sir.
operator
Thank you. I will request participants to limit your questions to two participants please. The next question is from the line of Debyanshu Kumar from Craving Alpha Wealth Fund. Please go ahead.
Unidentified Participant
Thank you for the opportunity. My first question is with the growing adoption of electrical vehicles and increasing penetration of lithium ion batteries, how important is the use of lead based batteries in the EV ecosystem in today’s time? Also, how does the POCL view the future demand trend in this space?
Ashish Bansal
I mean you’re. Can I get your name again? I lost you in the beginning, sorry.
Unidentified Participant
So my name is Devanshu from Caving Alpha Wealth Fund. Yes.
Ashish Bansal
So regarding the usage of lead acid battery, as of now, the growth in terms of the lead acid battery segment is still in excess of 3% globally and in India still at about 6%. How we look at it is, I mean it cannot be an overnight change in terms of lead acid battery to lithium battery because there are a lot of restrictions, constrictions in terms of usage of lithium batteries in all of the system. If you look at the EVs, right, from your basic infrastructure of charging to disposal to even the whole chemistry, it is still in the phase where it is evolving.
So right now, for the next about eight to ten years, lead acid batteries are definitely here to stay and going forward as well because it’s a mature technology and pretty safe and techno commercially viable.
Unidentified Participant
Okay, so thank you for the answer. Next question is could you share an update on the lithium battery recycling facility planned for FY27 and what impact do you expect it to have on company’s financial and product mix over the time?
Ashish Bansal
We have not yet finalized anything on the lithium ions. And like we said earlier, Mr. Vijay, sorry Mr. Vaijanathan expressed that we are looking at different technologies. We are working on it because the chemistry by itself what’s available, what’s not available, what’s happening is being the market is still evolving. So once that is there is when we will take addition. As of now we do not have a concrete plan in establishing a setup.
Unidentified Participant
Okay, so another question, the last question from my side is that is company. Company planning to position itself to benefit from China plus one strategy in the current scenario have been any significant traction or inquiries from the battery manufacturers shifting away from Chinese suppliers.
Ashish Bansal
I’m sorry, I didn’t get you on that. Can you repeat that question?
Unidentified Participant
So my question is so that does company positioning itself is to benefit from as a alternate to China for the lead production and all for lead sourcing and all. Hello.
Ashish Bansal
Yes, Let me explain to you. I mean India never imported metal, lead metal from China because generally from China metal, I mean lead does not get exported out and stays within the country due to their internal taxation or export tax laws or whatever. So I mean there is, there is no impact specifically on that. But definitely as lot of consumers are moving away from China in a lot of aspects. So the Southeast Asian demand is a little higher except I mean with the companies or the buyers who have moved away from China.
Unidentified Participant
Thank you sir. Thank you for answering my points.
operator
Thank you. The next question is from the line of Vaishnavi Gurang from Craving Alpha Wealth Fund. Please go ahead.
Vaishnavi Gurung
Hello. Congratulations on the good setup numbers. Sir. My first question is a follow up question on EBITDA margin. Again. However, the operational efficiency efficiency part is understandable. But if you can give us a range of how much of lead prices is on EBITDA margins.
Vijay Balakrishnan
Can you please come back again?
Vaishnavi Gurung
Yeah. Hello, My question is on the my question is on the EBITDA margin. Apart from the operational efficiency, what percentage of lead price impact is on ebitda? If you can give us a range how significant impact is on EBITDA margins By the lead prices.
Ashish Bansal
Do you mean the basic lead price by itself?
Vaishnavi Gurung
Yes.
Ashish Bansal
I mean in terms of our margins we run a completely hedged model. So in terms of percentage the impact is hardly any impact because our raw material was. Sales are completely fixed.
Vijay Balakrishnan
So in fact Mr. Ashi said, see through operational efficiency 1 to 1.5% increase in EBITDA margins. And apart from that, when you convert that into numbers is approximately 2.5 to 3 rupees. In terms of number terms, when it comes to the value added product part, it is about 1% which is typically 2 rupees. Which in total makes about 5 to 5.0 rupees.
Vaishnavi Gurung
Okay. There’s basically no significant impact by leg sizes.
Vijay Balakrishnan
True? Yes.
Ashish Bansal
In terms of percentage number.
Vaishnavi Gurung
Okay. Okay. Thank you. Got it. Sir, my second question is on the new capacity added. If you can give us a overall capacity utilization that you’re expecting by FY26 and any plan of adding new capacities in FY27 and 28.
Ashish Bansal
We are targeting about 120,000 tonnes in the current financial year in FY20 on the left side. Currently we are not looking at any further capacity creation. But definitely yes, on our other verticals like copper and the fresh verticals that are coming in, capacities will be added.
Vaishnavi Gurung
Sir, can you please repeat the number on for FY26?
Ashish Bansal
FY20C, we are targeting at about 120000 tons.
Vaishnavi Gurung
Okay. Sir, my third question is on the geographical breakdown of export revenues. If you can provide us for the same.
operator
I want to interrupt you, Vaishnavi Gurung. I’ll request you to join the queue for follow up questions as there are several participants waiting for their turn.
Vaishnavi Gurung
Okay. Sure. Sure. Thank you. Thank you.
operator
I will request participants to limit your questions to two per participant please. The next question is from the line of Raheel from Crown Capital. Please go ahead.
Rahil Shah
Yes. Hi sir. Can you hear me?
Vijay Balakrishnan
Yeah.
Ashish Bansal
Yes, please.
Vijay Balakrishnan
Hello.
Rahil Shah
Yeah. Can you hear me, sir?
Ashish Bansal
Yes, we can.
Rahil Shah
Yeah. Thank you again for this opportunity. So there’s two questions. Quick ones. What is the overall value added products contribution to the revenue and can we do. Can we achieve, given the current pricing and the market conditions, a 30% growth for FY26.
Ashish Bansal
The current contribution, about 71% of the lead portfolio is a value added product. Other validated products, 30% growth on overall. I didn’t get your second question. Can it be more clear?
Rahil Shah
Yes. Like on a consolidated basis, can we see a 30% plus revenue growth for this year since the first quarter has been, you know, really good on optimistic.
Ashish Bansal
Basis we are looking at similar ranges. But I mean it’s a forward looking statement. So we definitely are not committing. But definitely we are looking at such numbers.
Rahil Shah
Okay. Something like that is definitely achievable, you saying yes. Okay, thank you.
Ashish Bansal
Thank you.
operator
Thank you. The next question is from line of Shivam the way from MIV Investments Private Limited. Please go ahead.
Unidentified Participant
Yeah, hello. Am I audible?
Ashish Bansal
Yes, please. You’re audible?
Unidentified Participant
Yeah. Great set of numbers. Fairly new to the business. I have one basic question. How do we assess your profitability on an EBITDA level? Do we look at it on a margin basis or do we look at it on a per kg basis?
Vijay Balakrishnan
We are looking at margin basis. But since all the investors are looking at EBITDA per ton levels, so we are also, you know, coming out with EBITDA per kg or EBITDA per ton levels. We generally look at margin as a percentage basis.
Unidentified Participant
Okay. But given that all the products that you deal with are commoditized in the sense that the prices fluctuate a lot, would it be better to look at it on a per basis? Because your margin guidance also on like you’ve given up guidance on margins. So that was the question.
Ashish Bansal
Yeah, on a percentage basis, look at it. Because on annual average, when you look at it, the overall pricing on Basin plus or minus, I mean they get to that point. And for us, our model is basically like we spoke earlier, it’s a hedged model. So we look at generally in terms of percentage. But since you know, people like to know about rupees per ton, so we also guide on those numbers.
Unidentified Participant
Okay. Okay. Another question I had was on your value added product mix. So today you are at 71%. So if I had to look at it on per kg or margin basis, how much more differential can you get just by shifting to a value added product? Because assuming you’re at 71%, what is the total number of WAP can go to.
Ashish Bansal
See technique we had earlier guided, we are targeting about 60% plus value added products. We have been able to achieve 70% this year. So I mean definitely 100% of your products can’t be value added. There are some basic base products as well. So it’s more of a package that customers also require. So as of now for this year, we will be looking at similar levels of 70% of value added products. And look, in the future we will look into buy in our other portfolio, that’s our copper portfolio and all of that there is where we will look at more value added products which we are developing.
And in the coming financial years we will be able to explore that side of it.
Unidentified Participant
Okay, and just one follow on if I could ask your lead volumes were grew 9% year on year. So how do you expect this vertical to grow going forward?
Ashish Bansal
Yeah, I mean in terms of volume like we have varied. About 120,000 tons is what we are looking at this year. And going forward, reaching from the smelting side, reaching 160,000 tons capacity from the smelting side.
Unidentified Participant
Okay, okay. Okay. That’s it. Thank you. Thank you.
operator
Thank you. The next question is from the line of Bhavesh Chauhan as an individual investor. Please go ahead.
Unidentified Participant
Sir. Now that Amara Raja is also expanding its capacity from 50,000 to 1 lakh 50,000 tons. And they will have their own clients giving supplying them lead scrap lead from their own batteries. So sir, in terms of our availability of raw scrap from domestic market, will it not be impacted?
Ashish Bansal
Amaraja as a company was earlier also collecting their scrap batteries but was giving out as tooling through their recycling partners. And now they will be using the same scrap themselves for their manufacturing. And I mean it’s a balance in market. I mean what they were consuming through others, now they’ll be consuming through their own research process. And that’s how we.
Unidentified Participant
Okay, but in case of shortage, how if we. If we import more than domestic, how it will impact our margins?
Ashish Bansal
So this is a balancing of the market. Basically the markets behave differently at different LMEs. You know, sometimes at the lower LME levels, the domestic market market tends to become more expensive. At the higher LME levels, it is a little cheaper to have a domestic procurement. So it has to be balanced out on an averaging basis through the year. And that needs to be hedged back to the exchange.
Unidentified Participant
So in my understanding, correct that you know, there is not much overall, there is broadly, there is not much difference between imported scrap and domestic in terms.
Ashish Bansal
Of the quality, I mean quality of the battery. There are types of batteries that each application has the recoveries and the prices based on the kind of scrap that you import or that you buy domestically. So it all finally comes back to the amount of recoveries that you can get out of each battery.
Unidentified Participant
Yeah, I got it. Thanks a lot and all the best.
Ashish Bansal
Thank you, sir.
operator
Thank you. The next question is from the line of Shagun Jin as an individual investor. Please go ahead.
Unidentified Participant
Hi. Congratulations for the fantastic results, sir. I wanted to understand what products you’re working on. Is there any thought on the new demand which has come up in the market on the rare earth minerals? Because there’s a lot of talk of recycling of rare earth minerals also going on in the market. Can you please let us know your thoughts? On the same. Thank you.
Ashish Bansal
We are working on a couple of products. It would be a little early for us to explicitly speak about them but definitely we are working on similar lines where the demands are keeping up.
Unidentified Participant
Okay, thank you. No more questions from my side. Thank you.
operator
Thank you. The next question is from the line of Gopinath Chena from cdk. Please go ahead.
Gopinath
Congratulations on great set of numbers, sir. So I have two questions. The first question is if you compare the last revenue with yoy, we have around 40% of increase. Around 40%. So how is the rest of year going to be.
Vijay Balakrishnan
So in the lead? As we already told it’s about 1 lakh 20,000 tons. We are expecting in terms of tonnage, in terms of value on overall basis we know 30% is something which we are expecting on the value side with the blended both lead and copper put together.
Gopinath
Yeah, okay, that’s great. And the second question is in earlier you have said that something like we are going to save some administration. So is that how much amount equally can we quantify that?
Vijay Balakrishnan
It’s approximately about 17 lakhs per month which equates to 2, 2 crores per year. So to that extent there will be an increase in EBITDA in the plastics division.
Gopinath
Yeah, thanks. All the best.
Ashish Bansal
Thank you.
operator
Thank you. Before we take the next question please and reminder to the participant, please limit your question to 2. Should you have a follow up question we would request you to rejoin the queue. The next question is from the line of Shagar Shaha from Spark Capital. Please go ahead.
Sagar Shah
Thank you once again for giving the opportunity. My first question was related to the reverse charging. Reverse charging mechanism actually. So sir, we were expecting that in this quarter, maybe in the next actually the, the mechanism will be applicable and will be applicable on the lead and on the lead recycling and there will be shift in market share due to from the unorganized to organized to due to the imposition of such regulation. So I know you have already answered but I wanted to understand that what is your take on that? That will the change in market share happen because of this quickly or this imposition will happen in year in FY26 and if it happens what will be the effect of the same? And my second question was the data keeping question that out of the total scrap that we took for lead in this quarter, how much was imported and how much was domestic in percentage? Thank you.
For these were my two questions.
Vijay Balakrishnan
For the first question the threshold limited government of India has not fixed in the high, very low threshold. They are. Deciding in the metal industry or scrap industry value is very much important. Small quantum. If they fix and if they give RCM it is of no use to the players like us. So that will be equal to 10 tons of material which is not enough. If they increase the threshold limit then if they give RCM that will be useful. That may not be useful for infusion for at present for import it is 80%, 20% is domestic. We are buying. So adding to Mr. Kumara B LC when it comes to RCM what happens is all the buyer of the scrap has to remit duty on the seller’s behalf to government. So in that case what happens is even if it’s an informal player, the moment he is supposed to pay duty on that respect so that what when he procures from somebody person it is his obligation. If he is a GST registered dealer, he has to pay duty on the sellers behalf and he has to remit. So to that extent the revenue leakage will come down to government.
Sagar Shah
Okay.
Vijay Balakrishnan
It is going to transition. Most of the informal players will have to move to formal system and ask him because there is a onus of responsibility on the buyer to remit the duty it is not on the seller. So to the seller. The second thing what Mr. Kumarwal was telling was in terms of GST percentage now if it is at 18, the moment it has been brought down to 5 percentage then the cash incentivization will come down in terms of inform when it comes to informal players. So once that incentivization comes down formally there is no, there is no benefit for the informal payers to sell.
So automatically everyone has to come through the formal system.
Sagar Shah
Okay. Okay, fine. So do you believe that the informal system will be will be able to bring to the. Will be able to adapt to the formal system? Sir, quickly.
Vijay Balakrishnan
The percentage has gone up from 2030% to now it is moved to 60%. Informal sector is reduced. Now it has moved to the farmer center. So over the period of time that. Will be reduced further.
Ashish Bansal
Well, when there’s a compulsion and there are, you know, no ways or there there is, you know, marginally any benefit for them to remain informal they will have to get back to the formal sector. And that shift should happen is happening and slowly over the next two, three years there’ll be a great shift in the market.
Sagar Shah
Okay? Okay, sure. So my second question sir, was related to the scrap. How much was imported and how much was domestic in this quarter?
Vijay Balakrishnan
Sir, so it is 80% import and 20% domestic approximately approximate.
Sagar Shah
Okay, fine sir. Thank you. Thank you so much.
operator
Thank you. A reminder to the participant to limit your question to 2. Please rejoin the queue for follow up questions. The next question is from the line of Navneet Chadha from Triumph Services. Please go ahead.
Unidentified Participant
Hi. Am I audible?
Ashish Bansal
Yes sir, you are.
Unidentified Participant
Okay, first of all I would like to congratulate for to all and everyone at POC for giving these fantastic results. And my question would be and of course good luck for the future. And my second question would be, is POCL wanting or willing to expand in the overseas market or are they going to acquire some assets out of India for their expansions?
Ashish Bansal
Any more question? Is that the only one?
Unidentified Participant
No, this is the only question.
Ashish Bansal
We are definitely looking at opportunities in the international markets and we are exploring but currently our focus, I mean is more towards India centric operations. And as you’ve seen in the past few quarters we’ve been expanding domestically. The domestic demand and the demand coming from overseas market to ship out of India has been great and India has been one of the global focus. So our current focus is more on India. But definitely alongside we are looking at opportunities for international expansion and that will continue once we have a good opportunity. We will definitely look at it.
But definitely we are not as guided earlier. We are not looking at the African markets at all.
Unidentified Participant
All right sir, very well noted. Thank you so much. That was the question.
Ashish Bansal
Thank you sir.
operator
Thank you. The next question comes from the line of Shweta Dixit from Systematic Group. Please go ahead. Hi.
Shweta Dikshit
Thank you again, last question from my side. What? What would be the copper exit capacity at the end of FY26?
Ashish Bansal
The. The copper capacity end of 26?
Shweta Dikshit
Yeah. At the end of February 6th the.
Ashish Bansal
Copper capacity end of 26 will be about 12,000 tons. Currently we are operating at approximately 6,000 tons which is in the process of expansion as well.
Shweta Dikshit
And when you say you expected to achieve 90% utilization, that’s for 6,000 tons of capacity in FY26.
Ashish Bansal
Yes, please.
Shweta Dikshit
And for FY27 where this number could be on a total capacity of 12,000.
Ashish Bansal
Tonnes again at 90% in excess of 90%.
Shweta Dikshit
Okay, understood. Thank you very much.
operator
Thank you. The next question comes from the line of Vaishnavi from Craving Alpha Wealth Fund. Please go ahead.
Vaishnavi Gurung
Hello. Thank you for taking my question again. Sir. One question was regarding the geographical breakdown of exports, revenue and which regions or countries other primary sources of lead stack for us. And does sourcing from Africa in particular offer any specific advantage?
Ashish Bansal
I’ll repeat your question. Are you asking our geographical breakup of Sourcing and in specific Africa.
Vaishnavi Gurung
So both and. Plus our export revenue breakup.
Vijay Balakrishnan
Okay, so when it comes to lead exports, our sales rate is 65% exports and 35% domestic. When it comes to for this quarter for copper it is 93% export and sorry domestic and 7% export. So when specific to countries see forests, there is. We import from different continents. If I were to say in terms of procurement, each continent contributes about 15 to 20% of our overall procurement. So from Middle east, from Europe, from us, from South America, we procure from different continents.
Ashish Bansal
And in specific to Africa. The lowest procurement for us is from Africa, which is only maybe in below 5%.
Vaishnavi Gurung
Okay, thank you. Sir, just again, I would like to repeat one question. I was asking for exports revenue breakup. Not domestic versus exports, but just export revenues.
Ashish Bansal
So approximately in terms of numbers is what you’re looking at?
Vaishnavi Gurung
Yes, in terms of percentage.
Ashish Bansal
In terms of percentage, about 65% is our export revenue.
Vijay Balakrishnan
Export revenues in terms of lead it is about 328crores export.
Vaishnavi Gurung
Sorry to interrupt you sir. I was asking for on geographic basis like how much is from US versus how much is from Europe.
Ashish Bansal
So Europe is marginally, Europe is below 5%. Southeast Asia would contribute to about 75 to 78% and the balance would be a part of it to the Middle east and other parts.
Vaishnavi Gurung
Sir, one last question from my end. As one of the fellow participants pointed out, do we foresee any near term risk of clients establishing in house led recycling capabilities?
Ashish Bansal
I mean we do not see it because if you look at the global trend that has been there and many of the large battery makers have their own internal battery recycling capacities even to a lot of customers they were currently supplying as well have their internal battery recycling capacities, you know, for over a decade. So that is a part of the whole industry as it is already there. So that does not really pose a larger risk to us.
Vaishnavi Gurung
Thank you sir.
operator
Thank you. The last question is from the line of Adesh Gosalia from Spark Capital. Please go ahead.
Unidentified Participant
Hello sir. Am I audible? Congratulations sir, on such a good set of numbers. I just had two questions. The first one was on the new alloys that you mentioned about supplying to the international customers. Right. So can you just like do we have any kind of order visibility in that on those orders or there. We have already booked those orders currently. So like as we are so confident about maintaining the higher margins. So that was the question one. And the second question was follow up on the previous participant. If I, I might have missed a point that as you said that the Exit capacity for copper would be around 12,000 metric tons for FY26.
So where will this capacity come in and will we see any revenue from this additional capacity in the current financial year?
Ashish Bansal
So reverting to your first question regarding the specialized alloys, yes, we have a clear order visibility series. We sign annual contracts and starting this first quarter, we have signed the annual contract for these alloys as well. And we have a very clear visibility through the year for these alloys. And as every year gets renewed, what we’ve been doing historically, the same will be renewed. And in terms of.
Unidentified Participant
Any number or, you know, metric turns or something that you can share, you know, share some numbers in that set if it’s possible for you, obviously.
Ashish Bansal
So it will not be, it will not make a very specific sense to you if I just say random in terms of, you know, tonnage or something. Because these are measured very differently in various parameters. They are blends of different alloys, different packages that how we do it. So in terms of metric tons will not, you know, really give you a clear idea on that. Okay, and coming back to your copper. Question, our current copper capacity is about 6,000 metric tons. And this by the end of this will be scaling up to about 12,000 metric tons. And this year we’ll achieve, out of the 6,000 tons, we’ll achieve about 90% and more. And in the next year on the 12,000 tonnes also we target to achieve minimum of 90% and could be higher as our market goes. If we are able to ramp up much faster, it could be higher than 12,000 tons as well for the next financial year.
Unidentified Participant
Okay, so right, for FY26, we should only take in 6,000 tons as a capacity for revenue. Like your revenue will be coming in from the 6,000 capacity only as of.
Ashish Bansal
Now on the conservative levels. Yes.
Unidentified Participant
Okay. Okay, thank you sir. That’s it for my end.
Ashish Bansal
Thank you.
operator
Thank you, ladies and gentlemen. We will take that as a last question. I now hand the conference over to the management for closing comments.
Ashish Bansal
Thank you everyone for participating in this call. We trust that we have addressed all your queries during this session. However, if there are any remaining questions, please feel free to reach out to our investor relations team at Goindia Advisors. Once again, we extend our gratitude to all the participants for joining us today and thank you and have a great day.
operator
Thank you, ladies and gentlemen, on behalf of Pondy Oxides and Chemicals limited and also Go India Advisors. That concludes this conference. Thank you for joining us and you may now disconnect your lines .