Banswara Syntex Limited (NSE: BANSWRAS) Q1 2026 Earnings Call dated Aug. 08, 2025
Corporate Participants:
Unidentified Speaker
Ravindra Kumar Toshniwal — Managing Director
Analysts:
Unidentified Participant
Isha Shah — Analyst
Nirbhai Mahabhar — Analyst
Rajiv Saraf — Analyst
Ronit Kapoor — Analyst
NISAR — Analyst
Vikram Suryavanshi — Analyst
Presentation:
operator
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operator
Ladies and gentlemen, good day and welcome to the Q1 FY26 earnings conference call hosted by Bansvara Syntax Limited.
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 this conference call, please sign an operator by pressing Star then zero on your Touchstone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Ravindra Kumar Toshniwad, Vice Chairman from Banswara Syntax Limited. Thank you. And over to you, Mr. Toshniwad.
Ravindra Kumar Toshniwal — Managing Director
Thank you. Avita. Hello everyone. Good afternoon. I welcome you all to our quarter one FY26 earnings conference call. Along with me on this call, we have our CFO, MS, Kavita Gandhi and SGA, our investor relations advisors. I hope all of you have been able to go through our investor presentation uploaded on the Exchange and on our company website. Now, before I move to the specifics of our performance, let me briefly touch on the broader textile industry landscape which remains an essential pillar of India’s economic growth. India has firmly established itself as the second largest producer and the third largest exporter of textiles and garments globally, ranking among the top five exporters across several textile categories.
On the domestic front, the market is growing steadily at a CAGR of 10% and is expected to reach US dollars 350 billion by 2030, while exports are projected to scale up to 100 billion by FY30. This growth is being supported by various policy measures of the government, notably the good work done in making the India UK Free Trade Agreement happen. This has eliminated 99% of the traded products from India from duty and tariffs and will boost and enhance the competitiveness of Indian textiles in the key international market of the uk. Congratulations to the Ministry of Textiles for achieving this.
In addition, initiatives such as the 100% FTI under the automatic route and a 19% increase in the Ministry of Textiles budget allocation are encouraging both the domestic and international investments in Texas. In this context, the ongoing free trade discussions with Europe also present a potential upside offering access to additional markets and further supporting our export growth. Let me also address the elephant in the room which is the Trump tariff. The US is an important market and the tariff has been set back for India as a whole. However, I wish to state Banswara’s position particularly regarding the US tariff and its impact on us.
Every company will have a different impact for us. We have built our business over the past two decades with the US customers who have had the flexibility to manufacture garments in various tariff friendly countries that is relatively tariff friendly right now such as Bangladesh, Egypt, Sri Lanka, Jordan and Vietnam. And today nearly 90% of our US linked business is based on fabric routed through these different geographies around India. So we remain competitive in our fabric offering through our differentiated man made fabrics and we compete as always against the Chinese suppliers in the US market. In fact, logistically, when we have to supply our fabric to exporting countries like Bangladesh, Egypt, Sri Lanka and Jordan, logistically we are at an advantage as compared to China.
So we expect that out of our total exports of fabric, only 10% of our fabrics were going as garments directly from India. The rest were being exported as fabric directly through different geographies who are not yet experiencing the very high tariffs that India is experiencing. Due to this, we expect that there should not be any reduction in our targets of whatever exports we achieve for the usa. This is just to clarify Banswara’s position on this. We have seen already that as far as our competition with China is concerned in the worsted woolen branded fabrics, we have grown substantially in our business share and have taken the Chinese market share aggressively in India.
This is also expected to happen over the years with the growth in our man made fabrics and polyester blends. That said, the industry continues to show long term potential. The current environment remains complex. However, the global manufacturing landscape is facing sustained headwinds including demand side pressures, rising input and labor costs, unpredictable raw material prices and changes in consumer preferences. In addition, ongoing uncertainty around the tariff regimes and shifting trade dynamics continue to add to the near term challenges. Despite these challenges, we remain focused on leveraging our supply chain flexibility and product strength to navigate this environment effectively and capitalize on long term growth opportunities.
I can also add that the domestic market continues to be a large growth opportunity and we will leverage our differentiation and competitiveness to be a China plus one for most countries even if not possible. So much for the us. Now let me take you through the financial performance for the quarter. Our total income increased by 12.7% 309.6 crores on quarter one FY26 on a year on year basis. The EBITDA also increased marginally to rupees 21.9 crores during quarter one FY26. However, the profit before depreciation and tax was lower at 11.2 crores and as a pat, the company recorded a loss of rupees 1.4 crores in quarter one FY26.
Our total income did grow by 12.7% on a year on year basis, primarily driven by strong performance in the garment followed by the fabric and yarn. This growth was supported by improved capacity utilization in our garments where the demand particularly increased and lifting was good in most markets. However, our EBITDA for the quarter was impacted by certain operating challenges we faced in the yarn division. Particularly, we faced a temporary labor shortage during this first quarter one period which led to higher operating costs and a subsequent impact on margins. We lost substantially our capacity utilization in the yarn division.
That said, these challenges were seasonal in nature and have started to ease down. Moreover, the investments we have made in modernization and process improvements are already beginning to show results and will enable us to address such issues more efficiently going forward. Going forward, we do expect that the profit before tax will remain under pressure mainly due to higher interest costs from increased working capital and term loans as well as with the increased depreciation during every quarter. This will require us to execute all of our three businesses with higher turnover and margin. Now moving to our business divisions.
For the yarn division, the revenue from the yarn vertical witnessed a 10% increase in quarter one this year as compared to FY25. The sales volume increased by 13% year on year basis to 51 lakh kgs. The capacity utilization was lower at 70% in quarter one FY26. The growth was modest, the demand remained muted and we faced labor shortages as I mentioned earlier and we could not get the utilization levels that we target. There was a reduction in some stock and that is why you see that the sales increased even though the utilization did not. We shall continue to focus on high value yarn products that leads to enhancing our value growth.
With strong seasonal demand expected ahead and a healthy level of advance bookings already in place, we are cautiously optimistic about the coming quarters in the yarn business. For the fabric division, the fabric vertical witnessed a growth in revenue of 4% to rupees 117 crores in quarter 1 FY26 as compared to the corresponding period last year. This was lower than expected. But we were challenged by a slower lifting due to the tariff pressures and quarter one headwinds which slowed even the domestic market. The capacity utilization in the fabric vertical stood at 70% for quarter one FY26 and the sales volume was around 50 lakh meters.
We expect the next quarters to be better supported by good order bookings that we already have and the launch of our new CSIRO collections. We are also working to grow the wholesale markets in Italy and France. At the same time, we are focusing on using our capacities better in the domestic market, especially to replace the Chinese products that get imported. Now about the garment business. For quarter one FY26, garment revenue grew by 42% year on year to rupees 75 crores. This was a healthy growth. The capacity utilization in the garment vertical was also much better and stood at 78%, an increase of 29% year on year.
The garment segment is continuing to show strong momentum with healthy growth in both revenue and volumes. The capacity utilization has improved reflecting better demand visibility and stronger traction in export and domestic markets both. We’re focusing on our value added offerings which gives us confidence as we move into the next quarters. The focus now is on maintaining this pace, fulfilling our order pipeline efficiently and building further on the positive trend by expanding in new markets. As you all would be aware, we did complete our shifting from Surat and therefore the garment capacities are now more stabilized.
With this, I would like to open the floor for questions. Thank you everyone.
Questions and Answers:
operator
Thank you. We will now begin the question and answer session. Anyone who wishes to ask a question may press Star in one on the touchschone telephone. If you wish to remove yourself from the question queue, you may press star and two participants are requested give handsets while asking a question. Ladies and gentlemen, we’ll wait for a moment while the question queue assembles. The first question is from the line of Isha Shah, an individual investor. Please go ahead.
Isha Shah
Good afternoon. Am I audible?
operator
Yes, go ahead. Isha.
Isha Shah
Yeah, I have two questions. One is what are our margins in yarn, fabric and garment like individually? I would like to know segment wise. And second is, you know in our last con call you did mention about achieving 2012 EBITDA and the top line of 1550 crore. Okay, so how do you plan to achieve this? So these are my two questions.
Ravindra Kumar Toshniwal
Right? Thank you. So first, you know when I speak about EBITDA margin, I’m not speaking with one quarter in mind or specifically quarter one in mind. But over a general period of time, over the years, the yarn Ebitdas have been in the range of, let’s say between 6% to about 8% in the yarn business. In the fabric business, they have been in the range of maybe 8 to 10 or 8 to even 11 or 12 sometimes. And the garment business has been, what would you say, Kavita, is roughly the EBITDA that we get range 6 to 8 in the garment business.
So those are the normal Ebitdas that we experience in the business. And we were looking at averaging to a 12% EBITDA and we still hold that for the whole calendar year as a possibility. We achieved only 7.1 in the first quarter, but the first quarter had a lot of headwinds. And this particular capacity utilization that dropped in our yarn business was almost about 10 to 15% utilization drop, which maybe we lost about 300 tons of yarn productivity in the first quarter. So this significantly impacted our yarn profitability in the first quarter, which dropped to almost 4% EBITDA internally.
So this was really the reason why we could not achieve better than quarter one last year. Otherwise the result would have been significantly better than quarter one of last year, even in our first quarter. Now going forward with this resolved and the capacity utilization issue not being there, we are seeing demand in spite of all of the challenges that we expect. Given the scenario of what has happened with the us, the demand for band made synthetics imported into our country from China is reducing and it is being replaced by suppliers like us. And we are in a very good position to be able to take up a larger share of the China plus one market domestically for sure, in the fabric business and in garment packages supplied to various retailers within India.
And that is a very bullish scenario over there. Apart from that, the FTA with the UK is going to be very positive. So based on that, we hope that we can recover, if not in quarter two, but definitely by quarter three, quarter four, the momentum should come back and we have not revised the targets that we made to achieve 1550 and to achieve a 12% EBITDA.
Isha Shah
Okay, so sir, just to confirm, like you said, these EBITDA margins they have been over the years. So at what capacity utilization would these EBITDA marginally in yarn, fabric and garment.
Ravindra Kumar Toshniwal
Usually our yarn capacity utilization has been between 80 to 85% and in the fabric it has between 70 to 75. And in the garment business we have been between about 70 to 75 again is what I’m given to understand. So there is sufficient capacity available and we have now realized very clearly we have to be more aggressive to compete with China. Use all of the capacities and increase the turnover and therefore reduce our total cost of overheads to improve the ebitda. This is the direction we are moving towards.
Isha Shah
Okay, thank you so much sir.
Ravindra Kumar Toshniwal
You’re welcome.
operator
Thank you. Before we take the next question we would like to remind participants that you may press start in one to ask a question. The next question is from the line of Nirbhai Mahabhar from N Square Capital. Please go ahead.
Nirbhai Mahabhar
Good afternoon sir. So last year we invested around 148 crore. So could you just run through what exactly was the CAPEX breakup and what is this year’s capex?
Ravindra Kumar Toshniwal
Right, the breakup of where we invested the 150 crores. I’ll just give you briefly. I think it was mainly about 60 to 70 crores was within the fabric business which was mainly in worsted spinning and in adding some machineries in our finishing. And the balance was invested within certain infrastructure improvements within power and spinning and a little bit in the garment part. Those were the main investments. But we are seeing definitely that all the investments we made will result now in an increased business that we have in our worsted fabric as well as now have more capacity available in yarn to go coarser in counts and to produce more technical yarns as well.
So all that investment I think should begin to leverage from quarter two, quarter three onwards.
Nirbhai Mahabhar
So revenue is yet to flow from the last year’s capex and you are expecting it to ramp up?
Ravindra Kumar Toshniwal
Yes. And how about this year’s capex? We are expecting to spend about another hundred crores. About another hundred crores which is one to complete the 132kva project which we had on our power part. Then there’s additional water treatments and various other infrastructural thing for pollution control which we have installed where there is a significant investment because our water consumption has gone up. So these plus is there any major other investment involved? Yeah, some modernization and top up machineries in each of the areas would be there. So there’s not a significant one allocation in an area.
These will all be supporting our overall strategy the investments we’ve made.
Nirbhai Mahabhar
So if we look at last 23 years there has been pretty aggressive investment in capacity building or big modernization. Are we confident that this will flow through revenues and superior margin? Because that is completely missing in. If. You look at numbers.
Ravindra Kumar Toshniwal
You are absolutely right Nirvaiji. We yet have to leverage all of that investment and we have not yet been able to do so. But the whole point of making those investments was to make sure that we have the capability when the market is asking for it. So I think that the domestic market is showing us clear signs that it can be ratcheted up. All of our sales and we just have to be a little more aggressive in our pricing. And that is not going to impact margin because we have capacity available. So this is something which we will be doing going forward in all of the quarters in the export market.
The US part is a setback to our garment strategy because selling garments as a package to the US all the time we invested in building a certain customer base will now get eroded. Instead we will have to focus more on the UK Europe for exports. The domestic part of our garment strategy continues to grow very well. So I don’t see that any of the investments we’ve made will not be leveraged and will not be used. It has been delayed and we are working to take away this delay as soon as possible.
Nirbhai Mahabhar
So I was looking at your export revenue mix and direct US revenue in annual report shows only 23 crore. So does it get routed to other countries?
Ravindra Kumar Toshniwal
Yes, yes, yes.
Nirbhai Mahabhar
There is a very big number. There is a very big number of 272 crore others. So what exactly is this others? If I look at out of 570 crore export, 272 crore is the others. So which are these countries? Small, small like North America, Latin America and all that area where it is not yet to build that market.
Ravindra Kumar Toshniwal
So right now it’s all getting locked into.
Nirbhai Mahabhar
No, no.
Ravindra Kumar Toshniwal
I mean so what you would have for example shipments to Bangladesh or to Vietnam or Sri Lanka will be in these others. So actually we have a sale of something like 60 crores to the US alone in terms of sales to US brands. And then that fabric or that particular thing gets delivered into some other country. Right. So yarns can be delivered elsewhere and fabric can be delivered elsewhere. The garment export net going out of India was very small for us, only about 8 or 10 crores. So that is something where we are going to have to replace the rest of the other exports covers.
Also like Kavita was saying, Latin America and various countries in Europe. Again the countries in Europe have destinations which are scattered all over the world where the garments are made.
Nirbhai Mahabhar
Okay, okay. Another, another thing actually why I was trying to understand this 270 to grow ADARs number is because it is the fastest growing category. If you look at the last year this other number was 210 crore. So I mean any pocket which is growing much faster and we are not mentioning here.
Ravindra Kumar Toshniwal
So that pocket is Europe. Actually Europe for us has been the fastest growing market last year. And we continue to see a good momentum that will come out of both UK and Europe. Thank you, Nirvai.
operator
Thank you. Participants who wish to ask questions may press char and one at this time. The next question is from the line of Rajiv Saraf from Seraph Brokings. Please go ahead.
Rajiv Saraf
Hi. I have two questions. One is with advanced booking in place for upcoming quarters in the yarn business, can you share your visibility on yarn volumes and expected revenue momentum in the coming quarter?
Ravindra Kumar Toshniwal
You’re only looking at yarn right now, is it Rajiv?
Rajiv Saraf
Yes. Yes.
Ravindra Kumar Toshniwal
Okay. So the yarn bookings we don’t usually accept for more than 30 days. So we have coverage of around 30 days of yarn booking. More than that we don’t ex. We don’t accept because our delivery period for Yarn is within 15 to 30 days. Right. So normally we don’t take advanced bookings beyond that because in any case, if the market changes and the prices increase, we stand to lose. And if they decrease, people don’t lift.
Rajiv Saraf
And another follow up question is that garments have done well this quarter both in terms of volumes and revenue. What kind of steady state quarterly revenue do you think is sustainable from here?
Ravindra Kumar Toshniwal
We’re expecting at least a revenue of 25 crore per month as a minimum in garment business. And maybe on the upside it could go up to 30.
Rajiv Saraf
Okay. Okay. And what’s the broader plan to grow the garments as a share of your overall business?
Ravindra Kumar Toshniwal
We’ve been discussing this and we have a lot of more meetings and strategy sessions involved in this in which we are looking at the possibility to use all of our capacity and even leverage additional capacity that is available in the country today. Especially with this whole scenario, the US There is going to be a lot of garment capacity available and we have the design and sourcing skills to produce the garments even using additional capacity in the country. So we’re seeing what could be the upside here. There is a lot of potential and this is both for the domestic market as well as for Europe and uk.
Rajiv Saraf
Yeah. Thank you, sir.
Ravindra Kumar Toshniwal
You’re welcome.
operator
Thank you. Before we take the next question, we would like to remind participants that you may press Char in one to ask a question. The next question is from the line of Virat Shah from Shah Investments. Please go ahead.
Rajiv Saraf
Hi sir. Good. Doctor, going on the last participant question. So on the garment side, given the. Uk, FD and China plus headwinds, how do you see the export Pipeline shading for garments.
Ravindra Kumar Toshniwal
So we think that it will do very well in both the UK and Europe. As far as the USA is concerned, it’s particularly dead because we can’t battle of 50% or 25% tariff, especially when all around us our neighboring countries have less than us. So it’s going to be good even for countries like Korea and Japan and the Far East. So overall I think that the ecosystem of the textiles in India of MMF and worsted fabrics has evolved. We now have availability of a lot more variety in India and this is going to help our China plus one strategy.
Whatever you may say, China will remain a formidable competitor, but we will continue to continue to chip away at trying to get the share. I do realize we need to get it faster and we have the potential and capacities to do it, yet our execution needs to improve.
Rajiv Saraf
Understood, sir. Are you seeing any shift in customer sourcing preferences?
Ravindra Kumar Toshniwal
The customers are basically looking for good service, good product at good price and they are pretty neutral to geography as long as they get this.
operator
Kind of. Thank you. The next question is from the line of Ronit Kapoor, an individual investor. Please go ahead.
Ronit Kapoor
Yeah, hi. So I want to know, has the company like reduced in garmenting capacity? Because I’m looking at the previous presentation, the trousers on the jacket capacity are slightly reduced as compared to the numbers given. So I wanted to check on that.
Ravindra Kumar Toshniwal
Yes, it’s correct. Good observation. And you have picked that up because we shut down our SEZ in Surat, so those machines haven’t been moved and installed yet. We are waiting for the permission to be able to revive that unit as an fta, as a DTA domestic tariff area instead of sez. So that capacity has been reduced in both the jacketing and the trousers.
Ronit Kapoor
When is expected to start?
Ravindra Kumar Toshniwal
We are hoping that the government permissions come through, but it’s rather difficult to start say because delisting from an SEZ and getting a permission to operate that same area in the DTA is proving to be longer than we thought. This is something we are taking up with the authorities and hope to get resolved by the end of this year, hopefully.
Ronit Kapoor
Okay. End of this calendar year, right? End of this calendar year, yes. Okay. And one more thing was in the previous presentation you all had mentioned that are looking at new clients for government like Zara. Hmm. And others. So has there been update on conversions like any samples?
Ravindra Kumar Toshniwal
Yes. So unfortunately we put in also a lot of effort in trying to acquire some US customers which now it seems won’t go anywhere. So that effort got wasted. In our garment part, but the UK we are looking at significant growth and even in Europe, in France and in Italy in particular, I won’t mention the name of the customers but we are looking at significant growth there. So there’s no update from Zara and. H&M.
Ronit Kapoor
HM has been in continuous touch with us. Zara? No. Okay. And lastly you stated that you were. Able to leverage your capacity for governmenting. So I just know, I think you have crores. So but you have space in your current units, right? You are stated so how much more that you can be reached if you install additional machinery.
Ravindra Kumar Toshniwal
So we never said 450 crores for garment. The capacity wise. I’m saying capacity wise. Yes. So that exists. I mean the challenge is to sell it out. The challenges to be and this we are working on aggressively to figure out a way to offer the customers the price point they need and still maintain a margin which is decent. So I think they’re moving better in that direction because we are looking at the overall capacity utilization and fabric business improving. So we’ll be able to offer internally better prices on the garment. We are looking even at giving the garment costings based on our verticality and getting an overall EBITDA margin and improving our utilization by offering the customers the prices they want.
Ronit Kapoor
Okay. And so lastly, what is your like how the Simone brand did this quarter?
Ravindra Kumar Toshniwal
Simone is doing well. Thank you. Simone is picking up well and we’ve made a lot of deliveries for this coming season of Diwali already. The pipelines are filling up and we expect to achieve a turnover of around 25 crore plus in Simone within this calendar year. Within this financial year.
Ronit Kapoor
Okay. And the margin would be expected what range for this?
Ravindra Kumar Toshniwal
So I don’t. We are right now booking business and not worrying so much about the margin. We’ll do that part later. We don’t really know.
Ronit Kapoor
Okay, fine. Thank you. That’s it for myself.
Ravindra Kumar Toshniwal
Thank you.
operator
Thank you. Before we take the next question, we would like to remind participants that you may press Sharon1 to ask a question. The next question is from the line of NISAR from Credit Asset Management. Please go ahead.
NISAR
How much you do domestic in the market and how much is exports?
Ravindra Kumar Toshniwal
So what was it in the last quarter? In last financial year it was Almost I think 60, 70% domestic and 30% export last financial year. But this financial year we expect that that mix will be closer to export increasing. So 5050 is what we’re targeting. Quarter one is almost 50 50.
NISAR
Okay. And certainly you said in the past you have done EBITDA margin in the range of 6 to 8% seems low. So is there any scope for improvement? And if yes, you know, whatever levers are available.
Ravindra Kumar Toshniwal
We are trying to improve it, but the headwinds have been a lot, you know, as such, anyway, the depreciation is very low in the garment business and the investment is small. So even on an EBITDA margin which is low, the profitability is not as bad because both interest cost and depreciation are very low in the garment business.
NISAR
Okay, assuming, you know, business conditions improve, you know, as we assume in Q1, your top line growth at 42%, let’s say top line growth by 20, 25%. When do you have any scope for margin improvement? Or at what capacity relation you think margins can be higher enough from the rain that you mentioned?
Ravindra Kumar Toshniwal
I don’t want to talk about the garment business in isolation here, but I think that if the garment business improves for Manswara, we will be using our yarns and our fabrics within that garment business. And it helps all three. So the overall EBITDA of the company should increase. And as the garment business increases, this is the endeavor. We don’t want to specifically look at the EBITDA margin of one division alone. Because at many times we have to work like an integrated vertical company.
NISAR
So, sir, let’s say maybe you know, this quarter or last year, what was the internal consumption of cean and fabric, you know, for your garment business or.
Ravindra Kumar Toshniwal
Where do you see that fabric part? Internally was only 10 to 15% of our entire fabric production internally. But that’s what we want to increase. We want to increase the internal consumption and be able to make more garments and sell the garment as a package, give a solution to the customer where we are able to be closer to the customer with a more sticky account. If you are able to offer them the garment package and continuously be in the pipeline to be a primary supplier, then you have repeat orders coming season, every season. And this is the reason why we want the garment business to increase and increase our stickiness to the customer.
Similarly, the fabric business, we want more consumption of our internal garment business to happen, internal yarn to happen in there. So this is an integrated strategy. Plus, individually, each division has to do what it has to. So I think we are working on both fronts. And when all three engines are firing, well, we can get to that 12% EBITDA that we talk about overall.
NISAR
Business. Somebody mentioned that, you know, you have a capacity to do sales of 450crores. That is when once you are able to ship the Machinery from existing, the new facility ones. That is over, right?
Ravindra Kumar Toshniwal
Correct? That is correct. Okay, so this year our target is not to exceed 350. Our target is at 350.
NISAR
Yeah. Okay. And so beyond 450 crore, that’s a capacity, you can expand that existing facilities or you know, how do you see the growth environments?
Ravindra Kumar Toshniwal
I’m saying even that there will be capacities available without even our expansion. If we simply use our designing and marketing and product engineering skills to make the garment, we can use capacities outside and sell it.
NISAR
Okay. And sir, this year again you are targeting capex of about 100 crore. Maybe you think the capex intensity will be lower maybe from 27 onwards. I’m not asking for exit number but just broadly the kind of capex that you have done last three, four years, maybe three, four, next three, four years could be lower. Capex intensity?
Ravindra Kumar Toshniwal
Yes. It should taper down because most of the significant modernization and all of the mandatory requirements for, you know, meeting all the regulatory environment that is required and compliance that is required has been achieved and that was quite an expense. So I think that it will reduce gradually over the years for sure. Maintenance capex should not be more than say maybe 40, 50 crores.
NISAR
Okay, thank you very much and all the best.
Ravindra Kumar Toshniwal
Thank you.
operator
Thank you. The next question is from the line of Nirbhai Mahavar from N Square Capital. Please go ahead.
Nirbhai Mahabhar
Yes. What is our net debt? I missed that number. In case the net debt 1/2 30th rule is 465cr.
Ravindra Kumar Toshniwal
455. Yeah. Sir, do you expect it to peak somewhere here? Because you’re talking about 100 crore capex. But cash flow from operation will also be there.
Nirbhai Mahabhar
Yeah, yeah. This is on the higher side only. Even right now our borrowings are on the higher side on the working capital part. Do you think this year deleveraging will begin?
Ravindra Kumar Toshniwal
Well, hopefully definitely by next year it will happen. End of the year debt will be lower than the current debt. Not this year, but next year we do expect that to happen. This year it may not happen. Let’s hope it does.
Nirbhai Mahabhar
And when do you see actual revenues for fta? I don’t know, I missed this question probably. When do you see the actual revenues from UK FTA going through or benefit from UK fta?
Ravindra Kumar Toshniwal
So already we are beginning to see it within the fabric orders. The garment duties will have to be ratified by both countries parliament and this is expected to happen in six months from now.
Nirbhai Mahabhar
But the business section has started happening somehow. It’s not visible in numbers. So I was just Wondering can we expect that sequential improvement in numbers now for next three quarter in terms of revenue momentum?
Ravindra Kumar Toshniwal
I want. I mean, if you’re talking about revenue momentum as a whole with all three of our business businesses, I would expect yes, quarter on quarter, we should improve in all three businesses. But you know, sometimes the fabric business will be higher and sometimes the garment business will be higher and sometimes the yarn. So these things will change.
Nirbhai Mahabhar
Thanks.
operator
Thank you. Participants who wish to ask questions may press star and one at this time. Participants who wish to ask questions may please press char in one. Now the next question is from the line of Vikram Suryavanshi from Philip Capital India. Please go ahead.
Vikram Suryavanshi
Yes, in case of yarn, how will be our mix between say cotton or blended yarn?
Ravindra Kumar Toshniwal
Yeah, hi, Vikram. So we are not doing any cotton yarn at all. We do zero cotton. Cotton yarn spinning. In our company, we are making only blended Yarns. So it’s 100% blended yarns or even 100 polyester spun. But all synthetic or synthetic blended or synthetic blended.
Vikram Suryavanshi
And in terms of internal consumption for Yandy Fibrillite also?
Ravindra Kumar Toshniwal
Well, the internal consumption is about one third of our production. If we produce around 2,700 tons, we’re consuming internally maybe about 7, 800.
Vikram Suryavanshi
And given the. Then I think synthetic, what we have heard, how would be the opportunity for export synthetic yarns compared to say other countries who are more competitive in synthetic?
Ravindra Kumar Toshniwal
So we are being able to export to Europe and to. Even we were exporting some of our yarns to the US which are more differentiated in terms of the fact that they were dyed and more specialty yarns. So we are not good at commodity exports of yarn in the country, but we are good at specialties.
Vikram Suryavanshi
Okay, so basically dyed and other smaller lot size.
Ravindra Kumar Toshniwal
The smaller lot sizes, a little more technical fibers in it or something which is not commodity. Commodity.
Vikram Suryavanshi
Got it. And there has been some shift towards. Synthetic because of cotton. Prices are significantly higher and they have been increasing continuity with the msp. So is that trend still we see or now it is like a. More like a matured.
Ravindra Kumar Toshniwal
Oh no, I agree with that. There is a definite trend, Vikram, towards synthetics increasing and particularly in India. That is a very strong trend in India particularly the use of cotton is going down and the user synthetics is going up very strongly. So we definitely see that as a big plus. A lot of these fabrics which are being used in the country and even garments imported into the country which are synthetic from Bangladesh will be replaced by our internal production. I do expect that the government will in some ways Protect the imports happening of finished garments and finished fabrics into the country to promote the ecosystem within India.
Vikram Suryavanshi
And last part of. I think that has come down with this Bangladesh earlier which was a lot of import. Was that happening? I think the roadside at least they have controlled which will be supporting us.
Ravindra Kumar Toshniwal
Absolutely. So that’s an optimistic thing. There’s only new brands. Also the new growth of digital brands in India and many new brands who have 200, 300 crore turnovers have come up direct to consumer and there is growth all over the country.
Vikram Suryavanshi
Got it. Got it. Thank you very much.
Ravindra Kumar Toshniwal
Thank you.
operator
Thank you. Participants who wish to ask questions may press chart and one now. As there are no further questions from the participants. I now hand the conference over to Mr. Ravindra Kumar Toshnival for closing comments.
Ravindra Kumar Toshniwal
Thank you. I just want to thank everyone for being here with us on this conference call. To conclude, while the near term operating environment is quite dynamic, we are optimistic about the growth in all three of our business verticals as well as a vertical company, our overall focus on increasing turnover. Our focus remains on making sure we improve our capacity utilization and increase the sales. We believe the initiatives we are taking will help us to navigate the current challenges. And we view the current challenges as something which will make us stronger and allow us to to focus more on possibilities within the domestic and available markets in a focused way.
We thank you all for your continued support. Goodbye.
operator
Thank you. On behalf of Banswara Syntex limited that concludes this conference. Thank you for joining us. And you may now disconnect your lines.