AETHER INDUSTRIES LTD (NSE: AETHER) Q1 2026 Earnings Call dated Jul. 24, 2025
Corporate Participants:
Unidentified Speaker
Nilesh Ghuge — Moderator
Aman Desai — Promoter, Whole Time Director
Rohan Desai — Promoter, Whole Time Director
Faiz Nagariya — Chief Financial Officer
Kushal Doshi — Lead Investor Relations
Shubhambi Desai — Executive Investor Relations
Analysts:
Unidentified Participant
Amay Sharda — Analyst
Presentation:
operator
Ladies and gentlemen, good day and welcome to the Q1FY26 earnings conference call of ATAR Industries hosted by HDSC Securities. 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 touchdown phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Nilesh Guge from HDFC Securities. Thank you. And over to you sir.
Nilesh Ghuge — Moderator
Yeah. Thank you Steve. Good afternoon all. On behalf of SDFT Security, I welcome everyone to this Acre Industries conference call to discuss the results for the quarter ended June 2025. From the Acre Industry. We have with us today Dr. Aman Desai, Promoter and Whole Time Director, Mr. Rohan Desai, Promoter and Whole time Director, Mr. Fais Nagariya, Chief Financial Officer, Mr. Kushal Doshi, Lead Investor Relations and Ms. Shubhambi Desai, Executive IR. Without further ado, I will now hand over the floor to Mr. Kushal Krishi to begin with the earnings call for the Q1 FY26. Over to you Kushan.
Kushal Doshi — Lead Investor Relations
Thank you, Nilesh. A warm welcome to everyone. Apologies for the delay. Today on July 24, 2025, our Board has approved the financial results for the first quarter for the fiscal year FY26 and the same has been filed with the exchanges as well as updated over our website. Please note that this conference call is being recorded and the transcript of the same will be made available on the website of Ather Industries Limited and the stock exchanges. Please also note that the audio of the conference call is the copyright material of Ather Industries Limited and cannot be copied, rebroadcasted or attributed in press or media without specific and written consent of the company.
Let me draw your attention to the fact that on this call our discussion will include certain forward looking statements which are predictions, projections or other estimates about future events. These estimates reflect management’s current expectations on future performance of the company. Please note that these estimates involve several risks and uncertainties that could cause the actual results to differ materially from what is expected or implied. Ather Industries Limited or its officials do not undertake any obligation to publicly update any forward looking statements whether as a result of future events or otherwise. Now Mr. Rohan Desai will begin by sharing Ather’s business outlook and will be followed by Dr. Aman Desai who will share the ongoing expansions and strategy of the company going forward. And then we’ll have Mr. Fais Nagaria who will cover the financial highlights for. The period of review. Now I shall hand over the call to Mr. Rohan Desai for his opening remarks. Over to you Rohan.
Rohan Desai — Promoter, Whole Time Director
Thank you Kushan. Good evening everyone. I hope everybody is doing well and I’m glad to connect with you all to discuss the performance of our company for quarter one of financial year 2026. Last quarter was marked by heightened geopolitical tensions and tariff assert territories. On the back of this I am pleased to inform you that the demand of our products in the large scale manufacturing vertical grew by 9% year on year and 8% quarter on quarter basis. Overall the company has seen an increase in volume on the back of CM business model. Also the demand for our products continue to remain burned and we have added six new clients in this quarter.
Prices for our products in the LSM business model vertical has remained stable and this is evident by our margins remaining stable for this quarter. With respect to Acer’s business model we have seen 51% contribution of sales from large scale manufacturing business model, 37% coming from contracts less exclusive manufacturing business model and 10% coming from contract research and manufacturing services business model. During this quarter contracts with exclusive manufacturing is set to show a good growth where the orders towards Baker use is expected to increase and we will also start the manufacturing for Milliken products for Site 3 + our exports revenue stood at 33% of the total revenues and domestic sales stood at 66%.
Please note major shift in the domestic revenues is attributable to to the supplies made to Baker use Indian entity. On the Capex front we are on Track. Site 3 which we have dedicated to Milliken is expected to commence Production by Quarter 4 of financial year 2026. Site 5 which is based out of Panoli continues to progress smoothly and the target to Commission the first two production blocks in phase one continues to be by the end of quarter three of financial year 2026. On site five we plan to launch our own large scale manufacturing business products in the first production block which are targeted towards pharmaceutical, agrochemical and material science sector.
The average pricing for these products ranges between $30 to $40 a kilo. This product have been approved and qualified by our customers and are going to be manufactured for the first time in India. We are confident that we will be able to operate the plant at optimum level in 18 months from commercial production. From the start of the commercial production, the CAPEX cost per plant at site 5 is approximately 160 to 180 crores and we plan to achieve an effect on 1.75x at maturity. The second production block will be dedicated to CEM manufacturing. In terms of the sectoral sprint for this quarter we have seen Pharma and Agro now contributing only 46% combined while oil and gas and the material science segments are contributing 19% and 17% respectively.
This is on the expected line as we expect the share of pharma and agro to continue to remain at 50% levels as the share of oil and gas and material science sectors is expected to increase drastically. Our vision in terms of revenue contribution from sectors continues to an equal share of revenues from one Pharmaceutical and Agro second Oil and gas third Material science and the fourth is sustainability and renewables. In summary I would like to say despite of the macro volatility or soft economic environment in the last few months we have had heightened client visits at Ather with the number of projects either being fast tracked or new client discussions taking place where my Ather is becoming a preferred partner or the only partner for R and D and commercialization of the products.
We are encouraged by these discussions which are being taking place. With this I would like to conclude speaking and I would request Dr. Aman Desai to touch upon the research and development and new client initiatives for this period. Over to you Aman Aman.
Aman Desai — Promoter, Whole Time Director
Very happy to connect with you all again. Just to continue where Rohan left off, I am first pleased to inform you that during this quarter Ather Industries executed a contract manufacturing agreement with Milliken Chemical and Textile India Company Private Limited which is a wholly owned subsidiary of USA headquartered Milliken & Company. This is a very important milestone for us and a testimony really to the CRAMS research model that is being practiced at Ather. This product is now going to transfer from the CRAMS business model to the exclusive contract manufacturing business model. Under this agreement Ather will be the sole content manufacturing partner for a key strategic product for Milliken.
The initial duration of this contract is 10 years for which we will be fully dedicating our new site 3. We have been working on this product along with the customer over the last several years in the contract research and contract manufacturing services business model where we were developing the process together, scaling up together and then now this is being launched into commercial manufacturing at Ather. And we will be the sole contract manufacturing partner during the quarter. We also participated in the Chem Spec Europe Exhibition where we had more than 21 on one customers with various innovators and customers and industry leaders across sectors.
It is clearly visible that in the west the companies are unable to manufacture in the current environment, much more so in Europe and several companies as you know have been shutting down their commercial plants there and India is really a viable option in this for an alternate. Everybody does not want to be in China and India is really the only option. I’m currently right now on a two week work tour in the US meeting various customers across various sectors in various cities and participating in an exhibition where we are exhibiting. And there is also over here in the US a clear trend emerging of customers increasing the inquiries and fast tracking a lot of the projects that we have been discussing over the last several years.
Customers are indeed looking to partner with reliable partners in India and are expediting in finalizing the contracts much faster than what we have experienced in the past. We believe that ATHER is extremely well placed considering the relationships that we have already forged with these customers at the highest levels in the technical echelons of these companies and also on the basis of the world class infrastructure that we have built at Ather. And this year we will also be expanding further our RD facilities. The plan is to incur a capex of rupees 30 to 40 crores to increase the number of labs from the current 15 to current 8 labs to an additional 15 labs and the current 65 fume hoods to an additional 130 fume hoods including 4 engineering labs.
This clearly demonstrates that the number of industries we are getting from our customers are increasing rapidly and we are also trying to target new customers and also target additional products that fit into our core competency model with existing customers and new customers. This helps in increasing our wallet share with each of our customers. Currently in R and D we have more than 50 projects of which the majority of them are non agro and non farmer. With the ongoing CapEx at Site 5 we are extremely excited about this site. It is proceeding as per schedule and as per timeline and we have a clear line of sight for the first four plants in which the first two are expected to be completed by the end of this calendar year.
As mentioned by Rohan earlier, we have a large number of projects in the pipeline in R and D and the pilot plant and we are quite confident of being able to fill up the entire site with innovative and first time made in India products in our LSM business model as well as significantly increasing number of products which are getting finalized now for this site 5 In the exclusive manufacturing manufacturing business model. In summary, I’ve always mentioned that this is going to be a golden age for the Indian chemical companies and a number of opportunities are available now to the Indian specialty companies who have invested in R and D capabilities and infrastructure and I do believe that this is coming of age now and and this is proving to be true in the current global scenario.
We believe Ather is well poised to take maximum advantage of this opportunity that exists today in the global specialty chemical industry and hopefully we’ll be at the forefront taking advantage of these opportunities and translating these opportunities into actual projects being executed and actual revenue being generated for the company. Thank you all again for being online with us for the call. I’m we are very happy to take questions and now before that I would request Fez, our CFO to give you an overview of the financial results for the first quarter of FY26. Faiz yeah.
Faiz Nagariya — Chief Financial Officer
Thank you Dr. Aman and good evening everybody. I am glad to present the financial results of Athen Industries Limited for Q1 of FY26. The total consolidated revenue of the company stood at rupees 2,595 million in Q1 of FY26 as against rupees 1920 million in Q1 of FY25 which is a 35% increase year on year. This resulted in EBITDA of rupees 772 million in Q1 of financial year 26 as against rupees 402 million in Q1 of financial year 25 which is an increase of 92% in the comparing periods. EBITDA margin stood at 30% in Q1 of FY26as against 22% in Q1 of FY25.
The PET amounted to rupees 470 million in Q1 of financial year26 as against 299 million in Q1 of financial year25 which is an increase by 57% year on year. The paid margin stood at 18% in Q1 of FY26 as Against 16% in Q1 of financial year25. We have always been trying to reduce the working capital cycle and we are happy to inform that we have been able to reduce the working capital cycle more to 190 days which was 195 as on 31st March 25th wherein inventory days which was 175 days has come down to 165 days we are planning to do capex of rupees 350 crores in finance year 226 which will be broken down into R and D site 3 and finally that is the site 5.
The remaining claim for the fixed assets for the loss has been put up to the insurance surveyor along with the loss of profit claim. And we are confident to get the same settlement by the insurance company by or before Q2 of Financial 26. In fact the claim is submitted by the Survey insurance company and we are hopeful to get the same within July October 25th or August 25th. Thank you once again and we look forward to good growth story here onwards. Back to you Kushal.
Kushal Doshi — Lead Investor Relations
Thank you. First we request the moderator to open. The call for question and answers.
Questions and Answers:
operator
Thank you sir. 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 withdraw yourself from the question queue you may press star and two participants are requested to use handset while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is on the line of Abhijit Akhila from Kie. Please go ahead.
Unidentified Participant
Yeah. Good evening. Thank you so much for taking my questions. Just a few. To understand the numbers a little bit. Better, the CEM revenues seem to be. Up, you know, somewhat modestly this quarter on a sequential basis. So just sort of wondering, you know, how much of that is attributable to Baker Hughes and if there was a significant ramp up in Baker, then were. There any other contracts that kind of. You know, maybe softened a little bit sequentially? That was one. And then on the other hand the LSM business seems to have shown fairly good growth sequentially. So if you could please just help us understand what specific projects might have driven that growth. Thank you.
Faiz Nagariya
Yes, I’ll take the question if required. Rohan can pitch in. Actually the growth factor for contract manufacturing is the baker which is, which has kicked in which started from the last quarter slowly and then we, we have capitalized in, in that and we have taken. We have got a revenue of around 410 million from them. And that is the driving force. Of course. Of course we are also taking up various other contract manufacturing wherein the Aramco material has. Also means the converged material is also being sold to a couple of customers and we are ramping up on that.
I hope I have answered your first question, Abhijit.
Unidentified Participant
Yeah, so just the 41 crores that we booked this quarter, what would the number have been in the. In the fourth quarter.
Faiz Nagariya
It is only 25 crores. I think so.
Unidentified Participant
Okay. So sequentially it’s an increase of about 16 crores. And yet the LSM revenue is up by only some 4 crores.
Faiz Nagariya
Yes.
Unidentified Participant
So just trying to understand what happened. I mean any softening in the remainder of the business.
Faiz Nagariya
So see LSM is also, it’s going up the very. As Rohan said in his commentary. Also there is a volume growth which we are, we are witnessing since last few quarters. And this time also in LSM there is a volume growth itself. The prices are still subdued because of the Chinese dumping and we all the three models are seeing growth and we see a growth agent in the future as well.
Unidentified Participant
Fair enough, thank you. I’ll take it offline for anything more. And just one other thing on the outlook for this year, if you could please just help us with your outlook for the major growth projects. You know, Baker Hughes, Milliken, Site 5. How much could we expect in terms of contribution in this year? Fiscal 26. And then.
Faiz Nagariya
Yeah, we would not like to give a forward looking statement for the revenue potentials. But of course with the names which is which you have spoken will all be the driving forces for us and we look forward to a good growth trajectory. I’m sorry for the same.
Unidentified Participant
Sure, sure, no problem. And just one last thing from my. Side on the insurance front. How much is the amount that we are expecting to collect?
Faiz Nagariya
Approximately. We expect that we will still receive approximately 60, 50 to 60 crores more.
Unidentified Participant
Okay, understood. Thank you so much. I’ll come back in the queue for any more.
operator
Thank you. The next question is on the line of Amay Sharda from Punanta Investor Advisor. Please go ahead.
Amay Sharda
Hi, am I audible?
operator
Oh yes sir, you are. Please go ahead.
Amay Sharda
Okay, thank you for the opportunity sir. So I just had basic, some basic questions from relatively new to the company. So just wanted to understand when you first set up a plant, what is the minimum utilization level at which a plant becomes profitable for you?
Faiz Nagariya
So at mature these. Yeah, maturity these plants are expected to have a capacity utilization between 70 to 75%.
Amay Sharda
Okay. But then like below 70% they are not profitable or are they still profitable.
Unidentified Speaker
So can you just repeat your question because there is some disconnect in your questions.
Amay Sharda
So my question was that like when you first set up a new plan, like let’s see, setting up site three plus plus. So what is the minimum utilization level that the plan needs to get to 30, 40, 50% at which it becomes profitable for you to maintain these 20, 30% of margins that you’re having. So, so we need to select the products.
Unidentified Speaker
We initially select the products which are giving us a EBITDA margin of at least 25% plus. So then only we take up. And it’s not that the margins start coming after the capacity or the storage capacities reached to some extent. We start getting the profits from the day we start the sales. And only thing is we give a trajectory of how the ramping up. So the full capacity utilization which is approximately around 75 to 80% or maximum 85% of a plant, it takes approximately two years.
Rohan Desai
Okay, let me try to answer this question differently. On the CM side. What really happens is that the, the pricings are built up in a way that is the first year you are utilizing only 40% of your capacity and you are developing that product and streamlining that product. The product will be at X price and then once the product is stabilized, the product will fall. The price will come to a commercialized size of Y price. So you usually the capacity utilization is not a concern over here. When you are talking about CEM projects and if you’re talking about the NSM projects, if you reach 40, 45% of your capacity levels, you start generating profits out of it.
Amay Sharda
Okay, okay, got that. And so one more question I had had was like for site 3+ and 3+ plus, these are two different sites or like is it one in the same site?
Aman Desai
So we bought site 3 and then we bought site 3+ that is a adjoining land. So we just named it as site three plus plus just for, for the stakeholders to understand, I mean very clearly what we are doing. But both the sites will be joined together and will be amalgamated, I mean merged together to be site three in future which will make a notification of at the proper time. So it’s just a joining part of land site three plus plus.
Amay Sharda
Okay, okay, got that. So one more question was regarding the electrolyte additive segment that began some time ago. So this question was like how, how is it ramping up so far? And, and what kind of scale up can we expect further? And what were the revenues in FY25? If you can help with that.
Faiz Nagariya
On the revenue wise. We are not seeing any major revenues coming out of electrolyte LEDs for this current year. We will be seeing close to 10 to 15 crore of revenues at max coming out from electronic additives. But we are currently involved in few crams contract research and manufacturing services activities with regards to additive which will announce at the Proper part of time.
Unidentified Speaker
With. The rates at which the current electrolytes are trading at. It does not make any economic sense of any commercial production at current levels. So we are not manufacturing any electrolytes as we speak.
Amay Sharda
Okay, okay, sure. And so regarding the Otsuka Chemicals contract. So like has the ramp up being good in FY25 for that or like we’ll expect it from FY26?
Aman Desai
Yes, it is going as per the plan. So there is no problems in that. It’s going as per the timelines mentioned in the contract and as per the projections which we had decided at the time of signing of the contract.
Amay Sharda
So we expect it to ramp up fully in FY26. Like we can expect the 510 million revenues per
Aman Desai
26. No, 27. 26 would be 30. Yeah. Would be approximately 35 to 40 crores.
Amay Sharda
Okay, okay, okay, sure.
Amay Sharda
Okay. And one last question was regarding the Polaroid contract. So when do we expect supplies to begin for the Polaroid MSA that you signed for grams business?
Aman Desai
We are already doing Polaroid since quite few years. I mean so it’s ongoing. The contract is working out very, very well and we are delivering the products to. Done.
Amay Sharda
But you signed the new MSA in FY23, right. So after that on Polaroid.
Aman Desai
No.
Amay Sharda
Yeah. In Grams there was something for Polaroid, right?
Aman Desai
No.
Amay Sharda
Okay, okay, sure. That’s it. From my side. Thank you so much. Thank you.
operator
Thank you. The next question is in the line of Krishna Parvani from JM Financial. Please go ahead.
Unidentified Participant
Yes. Hi sir. Thank you for taking my question from my side. First wanted to understand what led to the degrowth in the agro and pharma business.
Aman Desai
There is no degrowth in the agro and pharma business. There is a growth in oil and gas segments and the other segments. Hence you are seeing the degrowth.
Unidentified Participant
Yeah. So I mean because last quarter and the previous year similar quarter revenue was in the range of 40 to 46 crore. This quarter I think we are what, 28 crores if I’m not mistaken. And then pharma also is 90 crore.
Aman Desai
Yeah, yeah. So quarter one, we renew the contract basically. So it has been deferred by two months. But it’s. It’s well in control. So I think it’s just phasing from one quarter to another. We don’t see any problems. No, we do not see any pricing pressure on pharma and agro. As of today all the prices are stable, bottomed out and the demand is there. On the volume side we are seeing Increase in the demand in fact. So. So I think. I think everything is in well in control in pharma and agriculture.
Faiz Nagariya
I will add to it that Krishan last quarter we did approximately 920 million in pharma which is 900 million. So there’s no degrowth, it’s just. It’s almost flat and in agro we had agro we had approximately 400 which is around 300. That there will be. There are the. Is the first quarters and the things ramp up in the few quarters so there is no degrowth as such the volumes are going.
Unidentified Participant
Okay. Okay. Maybe just contract timing. Okay, got it. And in the large scale good to see the. You know the revenue going up. What has led to this growth in the last scale because I think pharma is flat. So which other segment has contributed in the large scale manufacturing growth?
Aman Desai
So we have material science which I think has grown face. Correct me if I’m wrong.
Faiz Nagariya
Yeah, yeah correct. No and also apart from the last, in the last material science there is also increase, bit of increase in other sectors wherein like we are supplying small, very some small quantities to the new entrance also. So those are. The pharma is in line with the NAS quota itself. No much changes. Material science has wrong side. Otherwise there is a. There is a flattish for the elephant which is.
Unidentified Participant
Understood. Understood. This is. This is good given we have significantly seen a ramp up in the sales. So on the balance sheet side I just wanted to understand how much of the graph lock is expected to be capitalized in the current fiscal and capex outlook for this year.
Faiz Nagariya
Capex outflow for the this year as I spoke in my comment is approximately around 300 to 350cr and we would be capitalizing approximately the site three plus plus which is approximately 200 to 250cr.
Unidentified Participant
Okay. And in this skill are you looking to pair off your debt? Just wanted to understand the interest outflow from that.
Faiz Nagariya
Anyways repeat your question.
Unidentified Participant
So I’m I was asking do you intend to pair off your debt? I think you had 180 odd crores of that. I know you are on netcase side. Just wanted to understand the interest expense part because I think you’re paying quarterly 5 crores or so.
Faiz Nagariya
So listen all this is working capital and working capital date will continue because we do not have any long term dates. These are all short term dates for the working which we are using and we, we would continue this and I think so it will continue for our next couple of years unless there we have good internal rules to pay this off because we are not doing any kind of a other fundraise going forward currently.
Unidentified Participant
No, no. Fantastic. This is great sir. I wish you all the best. Things are looking good for the company. Yeah. Thank you.
operator
Thank you. The next question is on the line of Nitin Agarwal from Dam Capital. Please go ahead.
Unidentified Participant
Thanks for taking the question. When we look through the remaining part of the year from a growth perspective, do you see growth largely coming in from the existing kind of contract scaling up or do you expect any newer sort of specific contracts which will start. Which will get commercialized as we go along which can be a meaningful driver for. For the growth in the remaining quarter of the year?
Aman Desai
Yeah, so we are looking at Baker use in a big way. So. That’s right. For then we are looking at site three plus plus which is a milliken contract which will be commercialized in this financial year and then it will be ramped up in the next financial year and then we are also looking to start site files two production blocks in this financial year which will be ramped up in the next 18 months period. So we’re looking at this. This is all new molecules which will be launching and also some of the businesses will. I mean the top line of the existing molecules will also increase over here. But the major drivers will be this new sites and then this new projects.
Unidentified Participant
Thanks. And on the contract manufacturing of the CM contracts like the Milligan one that you announced recently, typically what is the. You know, given the current environment, how much time does it take for you to typically how long the negotiation cycle with clients like and. And how many contracts do you think? I mean how many such conversations would you be in advanced stages there maybe something can close over the next few quarters.
Aman Desai
Currently we have a lot of malls in there so approximately 20 to 18 projects which we are discussing which are almost in the world of federation or the talks are ongoing. So the negotiations currently are. Are. Are very fast tracked because of of the reasons which what Aman spoke about earlier in his commentary. I think the timeline now is less than four to six months for finalization of the context which was earlier one one and a half year which you usually take from the completion of the crimes activities and moving it into cem. But it has been shortened and it is very fast now it’s moving in a very very rapid pace.
Unidentified Participant
That’s great to hear but you know the point associated is given the where our capacities today are, assuming you sign any such new contracts, you know we would have to unnecessarily create capacity in unit 5 to get rid of these requirements or do we have capacities in the existing units to take care of some of these things which can potentially get signed up.
Faiz Nagariya
So if the quantum is less than, let’s say assuming 100, 200 tons, we can accommodate it in the Site 3 or Site 2 for Beka use we have Site 4 which is dedicated so we can expand that and modify them and add in that site. And if there are CM contracts which are bulky in nature, which are big in nature, about 200 to 500 tons or above 500 tons, then we have to go into site five. But we have a long, we already have a good insight of which projects are going to be qualified inside five.
So we will not be delayed in terms of setting up the plants. If you see the presentation and if you see the image of the site, you will see the other two production blocks are already up. It’s already constructed. So you just need to install the equipment and the pipings. And it takes usually six months to nine months to get the whole production block online. Now. Which was earlier, 18 months for the greenfield sites.
Unidentified Participant
That’s helpful. And secondly, on the two commercial blocks that you, that you have two blocks that you will be starting in Unit 5 this year, on the two LSM which are dedicated to LSM projects by. When do you see our commercialized revenues coming in from these LSM molecules for these?
Faiz Nagariya
I think quarter four of this financial year we will be, how do you say, streamlining the site and this production block. But from quarter one of the next financial year I think we will be seeing a good inflow of revenues coming out of this LSM model and the CEM model also.
Unidentified Participant
And these two LSM blocks, the product that you’re looking to make in these blocks like earlier in the past used to indicate some sort of, you know, addressable market for the products. I mean the product is identified for these two blocks. What would be the potential market size for these products be.
Faiz Nagariya
In terms of the value? I think we are looking at a 1500 crores of market size of the com to all three product combined in LSM model. And on the CM side? I would not like to comment on it at the moment.
Unidentified Participant
LSM is for one block or two blocks for lsm. Now in unit five.
Aman Desai
One, one block one.
Unidentified Participant
So you said okay, one for lsm, one for cn.
Aman Desai
Yes.
Unidentified Participant
Okay. Okay. Okay. Thank you so much.
Aman Desai
Yes, thank you.
operator
Thank you. The next question is from the line of Uttam Purohit from Monaj Network Capital. Please go ahead.
Unidentified Participant
Yes, thank you. For the opportunity. So as working capital days are different for each segment. If you could help me with what standard invented is and better days. We aim to maintaining each segment. And what’s the figure right now?
Faiz Nagariya
So as I told in my commentary, the current working capital cycle is approximately around 190 days and for the three models LSM is always on a higher side, CEM is on the lower side and CRAMS is the lowest one. And we just try to maintain, try to make an equilibrium and try to reduce the vacuum cycle as much as possible. And our target is to reach around 100m 65 to 65 days or 70 days by end of this financial year. And the Target in next two to three years is around 150 days of working capital.
Unidentified Participant
Thank you. And currently out of the exports US is about 5 to 6%. Could you help with like what the other geographies are and how much they contribute.
Faiz Nagariya
Other geographies are Europe wherein we have Germany so we are selling to Netherlands. We have China also we have Japan, we are selling to Middle east also we have sales to Korea, various countries are there. Europe is approximately 6 to 7%. Sorry 10 to 11%. China is approximately 4 to 5%. Japanese also approximately 3 to 4%. We are exporting to approximately 19 countries. 19 countries, Mexico is one of them.
Unidentified Participant
Okay, thank you. And last question on the CEM side Capex. So generally when we establish a plant. So are those plants specifically designed for that product or there is plants are generally in standard and they require some bit of complexity to cater to that product.
Rohan Desai
So I will try and answer this question. The plants are designed in a multi purpose manner and they are fitted in with the specific requirements of this particular products. But what we usually say is that our plants are true multipurpose plants which can be shifted from one chemistry to another if required with some regex in the. In the equipments and the pipings.
Unidentified Participant
Okay, so we would require only 10 to 20 kind of capex for a 100 crore kind of plan to just. Change the product type. Right?
Rohan Desai
Not 1520 crore. That’s very high number. I mean that’s 20 of the capex which you’re talking about. You’re talking about less than 50 lakh rupees to move from one one chemistry to another chemistry.
Unidentified Participant
And for the CEM also again on the CM CP side so generally we establish the CEM line after we get the confidence out of a cramps product which can be converted into a CEM or we establish or we generally start keep up capacity already for Any product. Which can be there.
Rohan Desai
Yeah. So if you just go through investor presentations, earlier presentations, we are talking about eight chemistries and eight technologies which are our core competencies. We operate out of this. Eight chemistries and eight technologies. And so moving from this, we are not moving from eight chemistry to the ninth chemistry. Right. So, so we know what we are going to do and that’s how we fit the plants and that is how we, we move from. We are able to move from one chemistry to another chemistry with the least amount of modifications and capex required. Does that answer your question?
Unidentified Participant
Yeah. Yeah. Thank you.
Rohan Desai
Okay.
operator
Thank you. The next question is from the line of Rohan Chukla from Anand Rati. Please go ahead.
Unidentified Participant
Am I audible? Yes.
operator
Yes sir, you’re audible. Please go ahead.
Unidentified Participant
Yeah, so I just had one question. So when we say that the capex target for FY26 is 350crores, how much do we expect it to be increased in site 5? And what could be the asset earning it?
Aman Desai
350 crores. From 250. Yes.
Faiz Nagariya
Yeah, yeah. Good. Yeah.
Aman Desai
So around the 350 crores we will be approximately putting up approximately 100 crores. 150 crores in site 5 and the asset turn on maturity will be approximately 1.5 to 1.75x.
Unidentified Participant
Okay, that answers my question. Thank you sir.
Aman Desai
Thank you.
operator
The next question is from the line of Rohit Nagraj from Bartleyol and Karani. Please go ahead.
Unidentified Participant
Thanks for the opportunity and congrats on good performance and models. First question is to Dr. Aman. So since you’ve been speaking to some of the US customers normally what is the timeline from which we get some confirmations from the customer to our RnD and far left and to commercialization? I mean historically the timelines could be different but in current circumstances what is the expected timeline that we are looking at? Thank you.
Aman Desai
Yeah, just a second. I’ll just repeat this question to Raman because he’s on the line. Sir, he’s asking that what is the time, what is the timeline which you take to place the customers and what is the timeline in which you finalize the commercialization with them?
Unidentified Speaker
Yeah, it depends on the product to product and the project to project. But typically we are finding that what was earlier a timeline of between say one year to two years to go towards commercialization with various customers or even one year to three years depending upon the advancement of the commercialization on their end. It is now being fast tracked to within one year. And so a lot of those people that Actually, I am documented to in this two weeks over here in the US and the various customers we are discussing with, they are all portraying a sense of urgency to translate their products into commercialization, either because of the problems they are having over here or because they want to expedite the launch of their products.
And so it’s a very. It really depends upon the process, the complexity, the number of steps and the advancement of their own internal pipeline. But anywhere between six months to two years is what we are seeing currently.
Unidentified Participant
Sure, that’s helpful. The second question on the Milliken contracts, so have we shared in terms of what could be the size of the opportunity over a period of 10 years? And in terms of the margin profile, will it be similar to the existing business margin profile?
Rohan Desai
I’ll take this question then. Aman can speak. We have not given any revenue projections because we cannot comment on that. And the margins will be, will be in similar or better than what we have at the company side.
Unidentified Participant
And does this also open up more opportunities with Milliken in terms of other projects where we are currently working on and there is a greater likelihood that those projects will also get commercialized in the next possible future.
Aman Desai
I will take this question. Yes, we are working on multiple projects with various customers, including of Milliken. And yes, the answer to your question is yes. That’s helpful.
Unidentified Participant
Thanks a lot and all the best.
Aman Desai
Thank you.
operator
Thank you. The next question is from the line of Atishray Malan from Fortress Group. Please go ahead.
Unidentified Participant
Yeah, hi. I have a few questions pertaining to the Milliken contract. Firstly, can you maybe provide some insight into the application this product is used in?
Rohan Desai
This is used in material science, polymer industry specifically. That’s the best I can tell you about this product. We are. We cannot tell you of more than this at this moment. In the due time, we’ll let you know the applications and the product name if the client gives us permission. Yeah, no, I appreciate that. That’s helpful.
Unidentified Participant
And just is this a fairly new product for Milliken or is this a fairly established one?
Rohan Desai
This is a new product for Milliken. We will be the only manufacturer and the first manufacturer of this product and to commercialize this product in the world.
Unidentified Participant
Okay, this last one from my side. Any specific geographies this will be used in or is this fairly widespread?
Rohan Desai
Again, I cannot comment on it. It’s under confidentiality. Hence, I cannot give you more information at this point of time.
Unidentified Participant
Okay, no worries. Thank you. Thank you.
operator
Thank you, ladies and gentlemen. That was the last question for today’s. Conference call. I now hand the conference over to the management for their closing comments.
Rohan Desai
Yes. I would like to thank everyone for attending the conference call. Apologies again once for the delay from our side. And we look forward to seeing you on the call. Thank you, everyone.
operator
Thank you. On behalf of HDFC Securities. That concludes this conference. Thank you for joining us. And you may now disconnect your lines. Thank you.