AGI Greenpac Ltd (NSE: AGI) FY 2025 Earnings Call dated May. 16, 2025
Corporate Participants:
Om Prakash Pandey — Chief Financial Officer
Rajesh Khosla — Chief Executive Officer
Sandeep Sikka — Group Chief Financial Officer
Analysts:
Ronak Ostwal — Analyst
Pranay Roop Chatterjee — Analyst
Rohan Baranwal — Analyst
Vijay Shah — Analyst
Rajdeep Singh — Analyst
Pravin Sharma — Analyst
Anil Shah — Analyst
Unidentified Participant
Presentation:
Operator
, ladies and gentlemen, good day and welcome to the AGI Greenpack Limited Q4 and FY ’25 Earnings Call hosted by Arihant Capital Markets 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 signal 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 Ronak Ostwal from Arihant Capital Markets Limited. Thank you, and over to you, sir.
Ronak Ostwal — Analyst
Thank you. Hello and good evening to everyone. On behalf of Capital Market Limited, I thank you all for joining into the quarter-four FY ’25 earnings conference call of AGI Limited. Today from the management, we have Mr Rajesh, Sar, President and CEO of the business; Mr Kum Prakash, CFO of the business; and Mr sir, Group CFO. So without any further delay, I will hand over the call to the management. Over to you, sir.
Om Prakash Pandey — Chief Financial Officer
Thank you good evening, everyone, and welcome to NGI Greenpack Q4 FY ’25 earnings call. We have already circulated our earnings presentation, which is available on our website and on the stock exchange website. Kindly note that some remarks or observations made during the today’s call might be forward-looking and these may include but are not limited to financial projections or a statement regarding the company’s plans, objectives, expectations or intentions. The company does not have any obligation to revise these forward-looking statements to reflect any future events or developments. For a comprehensive disclaimer, please refer to Slide number two of the earnings presentation. In the 4th-quarter of FY ’25, the company continued its growth trajectory, achieving total income of INR742 crores, registering a substantial growth of 17% compared to INR633 crores in Q4 FY ’24. The company’s EBITDA for the quarter stood at INR191 crore, up 23% from INR156 crore from the same-period last year, resulting in resulting in an EBITDA margin of 25.8%, profit-after-tax reached INR97 crore, a significant 50% rise from INR65 crore recorded in Q4 FY ’24. AGI Green reported strong financial results for the year ended, 31 March 2025, achieving total income of INR2,604 crore, registering a year-on-year growth of 6.5% compared to INR600 INR2,445 crore in FY ’24. The company delivered EBITDA of INR689 crore, an increase of 17% over INR588 crores in the previous year, resulting in an EBITDA margin of 26.5%. Profit-after-tax for the year stood at INR322 crore, up by 28% compared to INR251 crore in FY ’24. The company continued its strong momentum, solidifying its position as India’s most profitable glass packaging leader. I’m happy to announce the Board has approved a dividend of INR7 per equity share. Now I would hand over the call to Mr Khosla to discuss some of the key business highlights over to Mr Khosla.
Rajesh Khosla — Chief Executive Officer
Thank you, Mr. Good evening, everyone, and thank you for joining us. In the year 2025, AGI Greenpack achieved this significant milestone, demonstrating our commitment to excellence across various fronts. Our glass container capacity utilization consistently exceeded 95%, showcasing our dedication to operational excellence and efficient production optimization. We successfully executed debottlenecking initiative across our existing plants. And now with 2,000 ton per day capacity, we are well-positioned to cater to the growing customer demand. We further solidified our foray into high-margin categories such as cosmetic perfumery, alcohol and security caps and toasure. In a significant step towards the future growth, the Board has approved the setting up of state-of-the-art 500 ton plant daily capacity plant manufacturing in Madhya Pradesh, which will help us cater to the Northern and Central India market quite closely. This strategic move expected to increase our production capacity by approximately 25% underscores our commitment to capturing emerging market opportunities and driving sustainable shareholder value. We are well-positioned for continued growth and success in meeting the evolving demands of our industry. Now we would like to open the call for any question you may have. Thank you very much.
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 and one on their touchstone phone. If you wish to remove yourself from the question queue, you may press star N2. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles hi the first question is from the line of Pranay Rup Chatterjee from Berman Capital Management. Please go-ahead.
Pranay Roop Chatterjee
Hi, thanks for the opportunity. Am I audible? Yes, please. Sir. You are audible. Yeah. My question is with respect to the other income. There is a INR21 crore on a state subsidy that was recognized in Q4. Could you throw some more color on this? Is this one-time or would you be getting it yearly for a few years? Any other subsidy we should know about, which will recognize in the near-future?
Sandeep Sikka
MR. So I’ll answer this question. So when we make investment into the — into the state, let’s say, in the state of Telangana, there are various incentives of state government which are there, some of them are linked to sale tax, GST — sorry, GST refunds, some of them are electricity. Many of these for this we regularly apply to them. Our accounting is based on reasonable certainty. When the money comes in, then only we agrow it. Technically, these are all incomes which are related to business. And if you track our record for three, four years, you will see at many times we get this. So I cannot confirm that this will be a regular stream of income as such, but these are all incomes which are related to the businesses which we do and the investments which we have made in the in the state of Telanganam. So these are technically one-off but relating to businesses.
Pranay Roop Chatterjee
Got it. My next question is on your margins. If I look at it quarter-on-quarter and Y-o-Y, your GMs have taken quite a hit and which has slowed down into EBITDA margin as well, obviously ex other income. Any sense you can give what drove this low-margin of about 21% after multiple quarters of 25 plus? And what bearing would that have on incremental quarters.
Rajesh Khosla
Shall I answer this?
Sandeep Sikka
Yeah, Rajesh, please go-ahead.
Rajesh Khosla
Okay. See on a on a margin side, there are on a very, very elementary side, there are two aspects. One aspect is on the price part and second aspect is on the cost part. So what happens is the stability of the market always happen on the price part. But there is a one area which is beyond the control of a organization that is basically on the cost side and that too, particularly on those commodities which are well-controlled by the government. So the quarter what you’re referring to, they have had some little bit of disadvantage on the fuel side where the cost of fuel has gone up and it was high in those quarters in that particular quarter as compared to the other quarter. So what we normally do is we normally do not see from the perspective of one particular quarter where those elements which are beyond the control of anyone, they play the role of fluctuating any margins. It is more important when we say the stability of the business on the — on quarter-on-quarter basis and all. So normally, we always merge the whole year profit margins and the whole year EBITDA margins, which are quite indicative of the future and all. And your second part was, is it how it is going to be in the future? Yes, future is same as we have been committing in the earlier times that the market for us, particularly for us is stable. We are going to supply the material as per our earlier supplies. Small fluctuations has happened and small fluctuations can happen both on positive or negative side at any point of time, for timing and for a temporary basis.
Sandeep Sikka
But if you see year-on-year, we have been able to expand our EBITDA per ton by a range of around 6.5% to 7%. So it’s more the directionality rather going on the quarter-on-quarter numbers.
Pranay Roop Chatterjee
Sir, a follow-up to that. I’m not entirely sure about the fuel part. Don’t you guys report fuel separately like power and fuel? And I don’t see any increase on that front. So any specific component in COGF that has increased?
Sandeep Sikka
So here what we are referring to is the comparison of Q3 versus Q4, which reference you are taking. I’m also referring to Q3 versus Q4. And if I look at power and fuel cost as a percentage of revenue, it’s flat quarter-on-quarter, 19%. Your question is on the gross margin, gross margin. Okay. The fuel part has already gone up and they have been the reason of a small fluctuation on the EBITDA.
Pranay Roop Chatterjee
So okay. Sir, I’ll take that offline. That’s fine. My — that’s fine. Sir, on I’m not sure you want to answer this or not, but I was tracking the review petition and today it says dismissed in case status. So any color you want to throw on what the update is there or would you be disclosing it officially on the stock exchange? So we are still waiting for the final Supreme Court order to be uploaded. So it’s very difficult for to comment anything. So as it comes, we’ll make a necessary disclosure as applicable. Got it. If for the full-year FY ’26, any number on EBITDA margin? I understand that quarter-on-quarter there is volatility, but like the margin that print that has come in Q4 is 21% and previously it was 25%. So the range is quite wide. Any sense you want to give, which one is the more representative of next year? Is it more like 20% or 25%?
Sandeep Sikka
MR. So you had to take it as a range-bound, as such, if you see in the past also, our actual measurement is not on the percentages is actually the absolute EBITDA per ton because it has a numerator and a denominator effect because when the raw-material prices increase, so with some lag, we are able to pass-on the price increases to many of our contracts and similarly gets adjusted. So what we may hear internally from our perspective is our EBITDA per ton number, but I know we don’t give the tonnages as such to the market. But from your perspective, you have to work somewhere in a range of somewhere around 22% to 24% 25% only in the guidance. Yeah. And I think so if you talk of the EBITDA margins on the — on the annual scale, even if you ignore the other income part, they are always in the range of around 24% 23% 24%, something like that. And it has been in the year ’24, ’25 also, it has been in the year ’23, ’24 also.
Pranay Roop Chatterjee
Got it. Thank you, sir. For answering my question.
Sandeep Sikka
Yeah.
Operator
Thank you. Participants who wish to ask questions may please press star and one at this time. We take the next question from the line of Rohan Baranwal from Singhania Capital. Please go-ahead.
Rohan Baranwal
Hello, am I audible? Yeah. Okay. So, sir, I wanted to ask some questions regarding margin. So can you please explain the reason behind the decline in the margins? Certainly it has just been answered now? The previous question is on the same lines. Really sorry, sir, I was, I think inactive that time. So if we can repeat that would be much better.
Rajesh Khosla
I think we have already explained to the previous question that there has been some fluctuation on the fuel side. The fuel prices have gone up in the last quarter and they have basically contributed in the fluctuation of small margin. Margin, but normally, we see the directionality of the business, which is quite positive, healthy and moving positive towards that. There has been little small fluctuation, which always can happen in any quarter, it can happen because of any reason. So we hope that the fuel prices have already stable and they will stabilize further. And the margins practically whatever is a small fluctuation which has happened, it will get settled down.
Rohan Baranwal
Thank you. Thank you. Thank you very much, for your brief answer for that. Thank you. So my next question is regarding the innovation in your field mix, which you’ve talked about in the last call. So can you quantify the cost-benefit realized for this and what’s the target going-forward?
Rajesh Khosla
What do you mean like total value addition and innovation quantification, how much innovation is contributing in our margins? This is what you want to know?
Rohan Baranwal
Yes, sir.
Rajesh Khosla
So the is I regret to say that looking to the confidentialities and even our competitive edge over our other players, we are — we are not supposed to disclose that how much our innovation is adding to the contribution in our margin contribution in our margins because these are all confidential and secured type of things. Otherwise, it will get opened up and then we may not have any edge as against our competitors.
Rohan Baranwal
Okay, sir. Thank you.
Rajesh Khosla
But it is — it is open to the analysts like you to work it out that how much this innovation and other practices and good practices might have been contributing in our business.
Rohan Baranwal
Okay, sir. So if time persisted, can I go for the next question?
Rajesh Khosla
Yes.
Rohan Baranwal
Yeah, okay. So, sir, I just wanted the — like can you please explain how have the soda ash prices moved like Q-on-Q and what is it currently? And what about your glass realizations as well for a quarter-on-quarter basis?
Rajesh Khosla
I don’t think so. We are not indicating the glass realization or glass quantities in our disclosures. That is one part. And as far as the soda ash is concerned, now soda ash for last two, 3/4 is quite stable. They are still fluctuating, but to the some extent. And the price of soda ash depends upon many, many factors. It depends upon demand-supply, it also depends upon Red Sea issue. It may also depend upon India’s relationship with the Turkey. So it all depends upon so many factors and the — and the contribution or the — or the USA supply systems. So it depends on so many factors. But for last two, 3/4, it has been quite stable with a fluctuation of hardly 2%, 3% here and there.
Rohan Baranwal
Okay, sir. Thank you. And sir, if it’s not possible to provide the amount-wise details, can you please quantify it in if it’s up or down for the glass realization quarter-on-quarter.
Rajesh Khosla
I think I think okay. See, once the prices — because we have been indicating in our this call so many times that our prices have been linked with the formula-based pricing on the raw-material and other things, but there is always a time lag and there is a time lag. So if the prices in the last few months, they have adjusted on a lower side or a higher side, our prices have also gone accordingly with that. So there can be a little bit of timeline — time lags. And there is also sometimes there is a very temporary fluctuation, which may hamper or an I can say we can get a tail — tailwind for 1/4 or so, but it is — but more or less, overall, it is in the same range as our business used to be.
Rohan Baranwal
Thank you very much, sir, for your answer. I’ll join in the queue for my next question. Thank you.
Rajesh Khosla
Okay. Thank you.
Operator
Thank you. Next question is from the line of Vijay Shah from Insightful Investment Managers. Please go-ahead.
Vijay Shah
Thank you, ma’am, and congratulations, sir, on a great year FY ’25. Sir, as I understand, our greenfield capex will come up by closer to-end of FY ’27, no was ’26. Sorry for that. Yeah, yeah.
Rajesh Khosla
So end of financial year FY ’27
Vijay Shah
Yeah. Yeah. So just two questions. One is, in the meanwhile, do we have any plans of looking at any inorganic growth? That is first.
Rajesh Khosla
Okay. And what is your next one?
Vijay Shah
Sir, next one is that given that we have capacity constraint right now and value-added products are up to 23%. So over the next couple of years, if you could any guidance in terms of where do you expect value-added products to go to?
Rajesh Khosla
Okay. So yes, you are right. We expect that the greenfield project is going to be commissioned by the end of ’26, ’27 financial year. And till that time, no capacity can be added up. But yes, there is a — there is a scope. We are hunting on debottlenecking our capacities. Debottlenecking either on capacities, capacities are not going to be debottlenecked right now. But yes, with some practices and with some technological, we may upgrade our outcome of our furnace, I can say performances. So all the efforts our technical team and other teams are always there to put up the efforts to do that. So this is on the output side or technical side. On the commercial side, yes, there is a continuous endeavor to go for more-and-more value-added and we are doing it. Yes, we have been doing close to 20% to 23% rightfully you are saying. And we hope so we can add more percentage of products in the times to come. We are working on that and the successes we have to see in next two quarters, how much quantity we are able to push on the value-added. But yes, there is a consistent efforts to make more-and-more value-added products in this industry.
Vijay Shah
Sure. Sir, if I may, just one follow-up. The debottlenecking — debottlenecking could lead to — could lead to what kind of capacity growth approximately in a ballpark or is too weak today.
Rajesh Khosla
That’s what I’m saying. It’s a continuous effort and we are not — we are not sure. For example, like when we were building our furnaces, we were reasonably pretty sure that we will be able to add 80 tons or 100 tons of the capacity at that time because those were all quantified in that. But now the furnaces have already been built. Now whatever is the debottlenecking or capacity upgradation is concerned, it is more on the practices side. And in the practices side, we are also taking lot of help from the global technical teams and they are doing it. So we are never sure that how much quantity can come, but it’s a continuous exercise which we are going to do, but we are hopeful something is certainly going to be hitting us in the near-future.
Vijay Shah
Sure. Thank you. And just one more thing if I want to add. Sir, if you could just give a little color in terms of the demand scenario and pricing, are we facing any pricing pressure or how is the demand scenario from our customers?
Rajesh Khosla
Demand is okay. Demand — I’m not saying demand has any big change, but it’s a continuous thing. India has a very, very small glass demand. It is just less than 2 kg per-capita consumption. It is just 1.8 kg per-capita, which is far, far lower than the other countries. The China and the China has more than 12 kg and even in the USA, it is more than 36KG in Europe. In some of the countries, it is more than 60 kg or 70 kg per-capita consumption. So if we go that way, so it is certainly very, very less. Less and we hope that this demand is going to continuously increase in the near-future. I think India is — as India GDP growth is there. So obviously, new, new avenues on the consumption side, on the demand-side is opening up. And hopefully with the new FTAs they are having with UK and USA, which they are going to have. So there may be more export opportunity and the demand of the glass will also grow up because the end-product may require to pack in the glass site. So we hope that there is going to be a good demand in the future.
Vijay Shah
And so pricing environment continues to remain stable.
Rajesh Khosla
Pricing is sometimes the adjustments. That’s what I’m saying sometimes whenever the raw-material prices goes up-and-down, the prices get adjusted with that and there is a time lag. So with the time lag, there is small up and small down adjustment is always there. But more focus, I think we are also doing and probably the analyst is also must be watching, more is on the margin side on a stable continuous margin side.
Vijay Shah
Sure, sir. And lastly, sir, any comment on the inorganic opportunity? Are we pursuing something or are we likely to see something over there.
Rajesh Khosla
Again, being in business, it’s a continuous exercise. We certainly are looking at the opportunities, but unless until they are matured, approved by the Board, it is very difficult to say anything on that. But they are all-in an immature or in a WIP stage, I can say like that. So if anything is there, we will certainly just want to understand are we looking at it or not?
Vijay Shah
Perfect. Thank you so much. Thank you. Yeah. Thank you, sir. Thank you. All the best.
Rajesh Khosla
Thank you.
Operator
Thank you. Participants who wish to ask questions may please press star and one at this time. Next question is from the line of Pranay Chatterjee from Berman Capital Management. Please go-ahead.
Pranay Roop Chatterjee
Thanks. Sir, would you be able to highlight what the legal costs were associated with some of these cases in FY ’24 and FY ’25
Sandeep Sikka
Very difficult to respond to this you know because it’s not that surprise sensitive stuff but it’s not that we give an individual line-item as a part of the things but when you have the annual report copy, you will see — you can see from there what part can be there.
Pranay Roop Chatterjee
Got it. In terms of revenue guidance, in the past, you used to give after the annual results. Anything you would like to comment on FY ’26 or we have to wait-and-watch.
Sandeep Sikka
We had given a guidance of around with the existing product mix, debottlenecking, we have a potential to do 8% to 10% growth on over the last year numbers. So I think we’ll hold-on to that.
Pranay Roop Chatterjee
Got it. And one final question on the working capital cycle. Has anything changed on that front? This year our cash generated from operations sort of took a hit both because your payable days sort of went down and your receivable days went up. I mean, it’s not a material change, but it did affect your EBITDA-to-cash conversion. Any change there in terms of customer contracts and is the current level what we should expect ahead as well? So these are some of the things you know movement which are more of, I’ll say year end stuff but I think the plain answer is nothing much has changed here but these are the, you know the outcomes of a particular day, let’s say, when you say that number of days have increased by around 12 days. So when you analyze June, they may be lower as such. So I think what I’m trying to answer to your question is, if you see any abnormality in the movement or the stocks are not selling or we building up with receivables so that’s not going as a normal-course. Got it, sir. Thanks a lot. Thanks.
Operator
Thank you. Next question is from the line of Rajdeep Singh from Roha Asset Managers. Please go-ahead.
Rajdeep Singh
Hello. Hi, good evening, team. Am I audible? Yes. Yeah. Sir, this is in continuation to the previous participants’ question on the legal and professional charges. The number for FY ’24 is there in the annual report. For FY ’25, you are not being very upfront on calling out that number, it doesn’t matter. But just that — checking on that, it has been routed through the other expenses for the quarter and for the full — full-year, that is what I wanted to check. And this number would be substantially lower in FY ’26. Is that fair understanding?
Sandeep Sikka
Yes, definitely, because if you see, we had a big chunk of litigations going on during FY ’25. And also during FY ’24, but as I told you, the matter was subjidized before the Supreme Honorable Supreme Court and they have heard the matter for the last two, three — last two days and the last week. We’re just awaiting the order and let’s see, you know giving a guidance for next year-on the legal cost will entirely depend how the Supreme Court order comes in and what is the legal advice we get on the same.
Rajdeep Singh
Okay. But whatever is the cost that has been booked through the P&L, right? There should not be any surprise on the next quarter in terms of all that number now.
Sandeep Sikka
All the relevant costs are already booked.
Rajdeep Singh
Fair, fair, fair. Thank you. And second question was, sir, in Q3, you were saying you were going for shutdown. Hello. Am I audible now? Sorry, am I audible now? Yeah. Sir, with respect to HNG, you were saying in Q3 call that two more reactors were going under shutdown. So has that happened? And where-is this demand going to if you are not able to cater to this
Sandeep Sikka
I think SNG is making disclosures independent of us so we as we see their website and the disclosures of one furnace has got shut-down as very recently, but I don’t know where we have given a guidance that two furnaces will get shut-down. It was supposed to go for shutdown is what you called out in Q3, is that if I recollect. Okay. So that’s broadly on the conditions of the furnaces. I think what we would have told is a condition of furnaces there have not been rebuilt for pretty long-time and few of the furnaces are under pressure actually for a shutdown. Very recently, they have shut-down one, but on I think I’d like to avoid any comments any further on this.
Rajdeep Singh
Okay, okay. And sir, who has been able to cater to this demand? The customers are coming back to — is driving demand to us or comment on that.
Rajesh Khosla
Can you just repeat the question with more clarity so that I can answer precisely?
Rajdeep Singh
Sir, since the furnace is shut-down, the demand with respect to that, the customers, whom are they catering to. So is that demand coming to us or yeah, growing the industry able to cater.
Rajesh Khosla
See, what happens is the furnace shutdown has happened on the northern part of India, okay. And we are sitting quite on the southern side of the India. So the demand has not come actually to us and there has been some more capacities, which has been there in the northern side. So they have catered those demands and they might have adjusted with that. And secondly, we also had pushed some more quantities in the whole-system. So partly that has absorbed and partly it might have got absorbed with the other suppliers. Sure. That is helpful. And thank you very much and all the best. Thank you. Thank you.
Operator
Thank you. Participants who wish to ask questions may please press star and one at this time. I repeat. To ask a question, please press star and one now. We take the next question from the line of Pravin Sharma, an Individual investor. Please go-ahead.
Pravin Sharma
Hello, am I audible? Yes. Hello. Yeah. Hi, good evening, sir. Congratulations for excellent number for the year. I have one question. One is, when this capacity expansion for Madhya Pradesh came, you know, I was watching your interview on CNBC and we expected some 50% capacity increase over next two years. So where are we? Can you elaborate more because my worry is if this HNG thing doesn’t come away, which looks likely, then are we not — we don’t have capacity, much capacity left. So for next two years and once this SNG through this interventional sugar comes back, so will we not lag behind, we have not taken the — we’ve given them the headroom since we have our capacity limitation. So can you explain more how we are going from product here in next two years.
Rajesh Khosla
So during a time of litigation and during even the COVID times, we have been able to increase our capacity in a specialty class, then we have debottlenecking our two furnaces, which has added the further capacity. So these are the organic way of debottlenecking and adding the capacities. Besides that, that we announced 500 tons of a project, which is underway and we are trying to complete as soon as possible. So this project is certainly going to add at least 25% of our capacity as on today. Then certainly, we are seriously thinking on some other projects, but obviously, once those projects are finalized, so we will come back to the investors and inform them about that. So before that, there was a question, are you still looking for some inorganic or organic growth, yes, certainly, it is an ongoing exercise and we are certainly looking to that. And once anything get materialized, once anything get freezed and once we inform the Board and the SEBI, then accordingly, we will inform to the rest of the investors. So you please do not worry, we are in-line. We have our plans intact. We are not going to lose on percentage market-share in the market and certainly also not going to lose the trend of our growth, which you have been witnessing for last few years.
Pravin Sharma
So that sounds very good, sir. I hope you know we will grow and we will not lose the headroom. Yeah. Thank you and all the best.
Rajesh Khosla
Thank you.
Operator
Thank you. We take the next question from the line of Anil Shah from Insightful Investments. Please go-ahead.
Anil Shah
Yeah, hi, sir. Congratulations on a good set of numbers for ’26 — for ’25. I have two questions, sir. One, you talked about penning 8% to 10% revenue growth for ’26. Is that correct?
Sandeep Sikka
Yeah.
Anil Shah
And you know, stable margins from a yearly perspective, I understand quarterly aberrations can happen, but we’ve seen about, 23% 24% margins over the last two years. Is that — is that something that we can pen or subsidiary?
Sandeep Sikka
Yeah, sir, sir. So 8% to 10% growth and in the span of two years when the project is upcoming, as Mr Rajesh told we’ll have an incremental 25% capacity. Yeah. Over two years or is it 8% to 10% for ’26? I’m only asking this for FY ’26. Correct. And with stable margins. So you should see — we should see at least EBITDA growing? Yeah, yeah you are on-track. Correct. You are on-track, sir. You are on-track.
Anil Shah
Perfect. Perfect. My second question is, sir, just on the new project that’s coming up, just wanted to check land acquisition done, approvals in-place? And have we already placed orders for the furnaces? Is there any chance of a delay there or is it signed or is it’s all done? It’s like a done deal in terms of placements of orders, approvals, etc., et-cetera?
Rajesh Khosla
So are everything on-track. And as on today, I can say, I may like to complete the project and put it online at least one day before the date we have committed to the investors.
Anil Shah
It is — which is end of FY ’27,
Rajesh Khosla
I said at least one day before I will complete. Yes, at least I’m saying the word is at least. So as the project will proceed further, so we’ll see how we can fasten and do it further. So as far as your very specific question is concerned, whether we have finalized the furnaces and other things, yes, we have a GAN chart, timeline chart and everything is progressing as per that. So I can say that we are quite close because before placement of any of the — any of the machines or the — or any equipment, so there is a lot of due-diligence, discussions happened, so which are the practically close to putting up the order to them.
Anil Shah
So India needs. India needs launch of approval for everything on, sir.
Rajesh Khosla
All. I can say today that we are ahead of what we are supposed to be.
Anil Shah
Fair. Fair. And sir, my last question, for you to achieve, for just again I’m repeating, one, the project you told me everything is on-track, I appreciate. Second, you told me 8% to 10% for FY ’26 with steady margins. Anything that you think that can on the downside or in terms of the risk-on that, anything that can you in terms of you gives you — I won’t use the words hit the side, but which worries you, if at all.
Rajesh Khosla
Every day when we wake-up in the morning, it’s full of risk and threats.
Anil Shah
No, no, that from a business perspective, I mean, we do have a lot of long-term contracts.
Rajesh Khosla
A small thing. Let’s talk of very small thing. Yesterday there was a news that the — Trump has said something strong words for India. They say no need for producing the Apple phone-in the country. Then India decided to have a strong standing against Turkey. Correct. See, all these have — somewhere or the other can impact the negative. But along with the negative points, there are so many positive things are also happening, which may is visible or which may not be visible. So being the business manager, so it is our responsibility to see that how these negative things I can take it out and how to ride-on the waves of the positive part. So I cannot say that there is no negative. Every year, there were so many negative things. And this year also, we expect a lot of turbulence as by everyone. So — but don’t worry, I think it is our responsibility to see that we should ride all those negative parts and make sure that we fulfill our commitments to the market.
Anil Shah
Right. And sir, last question, we chose Bhopal. Obviously strategically makes sense from that perspective. But are we seeing any swaps coming in from the state government there in form of some waivers in terms of acquisition.
Rajesh Khosla
Today, today every state government is attracting the investments and they are doing they are investing — but they are attracting with lot of soaps. So of course, those soaps are available to us also. But at this stage, I can say like that, these soaps are designed especially for each project and we are not supposed to inform or to open up yes, reveal those things because they are — they are made especially for each project.
Anil Shah
Fair. Sorry if I. I can say — sorry.
Rajesh Khosla
I can say the government is treating us very fairly and we are quite happy with that.
Anil Shah
If I can squeeze in one more question, if that’s fine with you, sir. I’ve already questions. Tell me. Yeah. So in terms of the new capacity that’s likely to come in at the end of FY ’27, would you like to share if we have tied-up with end-users you know any particular percentage as far as the capacity is concerned already, or
Rajesh Khosla
Sir, okay, there are various ways of tying up with the — or with your products. So one tie-up is legal and contractual tie-ups. Second, the tie-ups you can say, it is on the way of your understanding and long-term association. The third tie-up, I can say that it is more on the — on extrapolating the demand-side is there is there. And the fourth is, you assume that there is going to be a technical upswing in your products and suddenly you are going to grab the market. So I think we are quite comfortable on all the four, five fronts and is there, because I can say the total quantity, whatever we are going to produce, partially we had a contractual tie-up, partially we have a understanding on a long-term basis, partially, I think because of our technological product, we are very sure that we are going to grab the market. So all these various pockets and aspects assure us that we’ll be in a good position.
Anil Shah
Great. Thank you so much, sir. That’s all that I had. Thank you. Thank you, sir. Thanks, bye.
Operator
Thank you. We take the last question from the line of Steve Sankar from EIP. Please go-ahead.
Unidentified Participant
Hi, good evening, gentlemen. So quickly two questions. Over the last few years, if I look at it, the cash generation has been so strong. So the capacity — the capex that we are planning is around 500 TPD. If I understand correctly that conduct 60, 40 that you could disconnect.
Sandeep Sikka
Your voice is too breaking. I don’t only happening for me or for anybody else. I can’t hear you properly. You’re holding your mic too nearer to your mouth
Unidentified Participant
Okay let me let me try to
Rajesh Khosla
Think if you can put a softer question maybe the voice can be clear.
Unidentified Participant
Hello. Can you hear me now?
Rajesh Khosla
Yeah. Yes.
Unidentified Participant
Hello. Can you hear me now?
Rajesh Khosla
Yes. Yes. Perfectly.
Unidentified Participant
Yeah. Your cash generation has been so strong and the way you have generated cash over the last four years is a really commendable. So the 500 TPD capex, if I really look at the way you have been generating cash, that should not be an issue at all for you in terms of your — any increase in your leverage. And what is the long-term plan or if I ask you for what — what are you going to visualize yourself in three years hence, where you want to reach and what are you going to do with all these cash generation? That’s number-one. Number two, and assuming that you will continue to generate next year also — year-after also. You have also planned to have your capacities built-up in the UAE? Where are we with regard to that? Because I understand that you’ve already set-up the company and all those things.
Rajesh Khosla
Sir, I’d like to answer the last question first and then my colleague Mr Sika will answer rest of the questions. Sir, we formed a company in UAE for marketing our products, which we are manufacturing in India. So we have not started any company to put up the facility in UAE as on today. Though we may be exploring and taking care, that is still okay. That is a part of the business, but particularly, we have not formed a company to explore any manufacturing facility in UAE as on today. Okay. Okay. So this is one part. And second part is about the cash part, which is a good problem to understand and to talk. I think my colleague is going to answer that.
Sandeep Sikka
Yeah. So I think if you see our performance, definitely a lot of cash is getting generated, which we have utilized to pay our debt and also build capacities by way of bottlenecking. So what you need to understand here is that we are now a very strong player on liquid packaging market and you know, and company wants to remain focus and all the initiatives which we have done over the last few years, they are yielding results, let it be the glass — glass internal efficiency buildup, our caps and closure project, which is now doing good. So of incremental investments, we are evaluating various incremental investments, organic, inorganic relating to liquid packaging market, which includes glass also. Okay. We see over-dependence on one particular type of packaging product may also over a long-term period may eventually — eventually may have a stagnation. So we need to move-in line with how the markets move — how the economic trends in terms of purchasing power are moving because when you see like all this — all this trending on per-capita income has lot of forbearance on how the demand emanates on the various types of packaging used in the various economies. We have a trend-line. This is a broader stuff, which I can tell you, like we have a plan for investments and at An appropriate stage, I think when something gets fructified and approved by the Board, that’s an appropriate stage, then we’ll come and informant and all the investors how the — how the plan now looks like moving five to seven years plan. So right now, the focus is more on two years, two to two to four years plan that how we should build-up our capacities on the glass packaging and then there is a plan further which we are evaluating internally.
Anil Shah
Yes. If I can push your last question. Earlier also, one — your colleague had mentioned about what’s a the per-capita consumption of glass in India, what vis-a-vis what we are seeing in Europe and US and in some of the Asian countries too, etc. In this context, with the economic growth that we are continuing to see, even if it is slightly lower. What’s kind of a capacity requirement or incremental demand that you are seeing for glass in India?
Sandeep Sikka
Rajesh, you answer? I take it. So basically India has a good potential in terms of you know, as the per the overall GDP performance of the country has been very good but I think the performance on our population increase also is correspondingly much better. So when you see the numbers on per-capita income, the trending is there. But definitely when we see citywise and when we try to analyze top-30 cities in the country. The demand for you know, the improvised packaging is increasing day-by day. And I’m not taking entire country GDP, but if you try to analyze per top-30, top 40 cities inside the country and their consumption pattern because major chunk of income is lying in those top-30, 40 cities in India.
Rajesh Khosla
So we have — I have already answered I think in the previous question, we have a glass consumption per-capita has already been indicated, which is 1.8. And just for information, we are in the GDP range of around less than $3,000 per-capita, GDP per-capita is $3,000. It has been seen that when the GDP moves from $3,000 to $5,000, so this $2,000 straight away enters into your lifestyle hygiene, eating habits and other things and where this glass consumption plays a very, very big role. See, today, if, if you are talking of USA and other, where the per-capita consumption — per-capita income is more than $50,000, 50,000, 60,000. So any increase in the per-capita income in those countries and those people probably may not have any impact on the rise of glass consumption because they have already matured to that level and those extra income is not going to add-up in their consumption pattern. But we are in a pattern where the maximum growth is going to happen between $3,000 to $7,000. So we expect that as the India grow and reaches 5 trillion, 6 trillion, 7 trillion, $8 trillion and this income level goes from $3,000, $4,500 per-capita. So there is going to be a huge demand in the — in the glass side. Difficult to say, but normally what happens is in this range, the glass growth and the GDP growth, they are more or less have a ratio of 0.9%, means for every 1% GDP growth, the glass consumption brand can be 0.9% growth. So this level of this thing we can easily assume.
Anil Shah
Got it. Okay. Thank you. I got some — something else also to ask. And I’ll ask it. I’ll take it offline and ask you later. Thank you.
Rajesh Khosla
You are welcome, sir.
Sandeep Sikka
You’re welcome.
Operator
Thank you. Ladies and gentlemen, that was the last question. I would now like to hand the conference over to the management for closing comments.
Sandeep Sikka
So I’d just like to thank everybody who was there on the call. Thanks a lot and see you again bye.
Operator
On behalf of Arihant Capital Markets Limited, that concludes this conference. Thank you for joining us and you may now disconnect your lines.