ASTRAL LTD (NSE: ASTRAL) Q3 2025 Earnings Call dated Jan. 30, 2025
Corporate Participants:
Sandeep Engineer — Chairman and Managing Director
Hiranand Savlani — Executive Director and Chief Financial Officer
Analysts:
Ritesh Shah — Analyst
Shravan Shah — Analyst
Sneha Talreja — Analyst
Abhishek Singh — Analyst
Rahul Agarwal — Analyst
Keshav Lahoti — Analyst
Praveen Sahay — Analyst
Akash — Analyst
Devang Shah — Analyst
Amit Purohit — Analyst
Rishab Bothra — Analyst
Pinaki Banerjee — Analyst
Manan Madlani — Analyst
Presentation:
Operator
Ladies and gentlemen, good day and welcome to the Q3FY25 earnings conference call of Astral hosted by Investech Capital Services India Private 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 the 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. Ritesh Shah, the Analyst, Materials and head Mid market coverage and ESG from InvestSec India. Thank you. And over to you sir.
Ritesh Shah — Analyst
Thank you Alrik. Thank you all for joining the conference call. We have with us Senior management of Astra Limited we have with us Mr. Sandeep Engineer, Chairman and Managing Director; Mr. Kairo Engineer Executive Director; and Mr. Hiranan Saulani, Executive Director and CFO.
I’ll hand over the call to Sandeep Bhai for the initial remarks post which we’ll have a Q and A Over to you Sandeep. Thank you so much.
Sandeep Engineer — Chairman and Managing Director
Thanks everyone for joining the earning for Q3. As you are very well aware, the building material industry is facing challenges in demand scenario during the quarter third quarter due to overall infrastructure spending by the government and liquidity challenges in the market. In spite of that I am happy to share that on consolidated basis our company was able to deliver a marginal top line growth of 2% and very healthy growth of 9.3% in EBITDA on yoy basis.
Now let’s go through the different verticals of Western. To start with pipe and Barber pipe vertical was doing excellent in last year in Q1 for the current year. But post election some slowdown started which has created a problem the industry. In spite of that Q3 we are able to maintain our volume and grow our EBITDA by 10.9% in spite of huge volatility in polymer prices. Entire industry was waiting for the anti dumping duty on PVC but it got delayed which also affected the industry volume growth. We are expecting that post budget there should be in place and this will be helping the industry at large.
In pipe, our focus continuously is and will be on value added products and quality products. We are working on that and we’ll bring new products in the near term. The good news is that much awaited UL certification for our fireprofitting is received recently by us. We were already holding the UL certification which is required when you sell the fire products fire pipes in the Indian market. Hence now our full range is UL certified which will help us in a big way for the project business and also the export business in Europe and various global markets.
I’m happy to share that Astel is the first company in India to get UN certification for fire sprinkler products. Now PTMT range as I guided we are launching it in the market and we have already launched it in this quarter and we are expecting from this PTMT range in the coming quarters. The Gelot plant has started SWR fitting production in a full scale and we are about to start the CPVC fitting production also in the full scale at Gelop plant which will help us to feed the northern markets and various markets in even eastern region.
Channel grain which we used to import from Europe and now we have started the complete range of production of channel grain in India and we are the only company making and the first company to make this entire range of channel grains at an international level of standards. And these channel grains are well accepted and used in many infrastructure projects whether it’s the private level or it’s in government level or building of airports or various facilities of iim. These our channel drains are accepted and are in use.
OPVC complete trials are over. The product range is ready and our products have gone for the BIS approval to get the ISI standard and we are expecting the BIS approval and ISI standard certification in a few days from now. So the entire product range will be placed in the market and we are expecting very good sales number from this new OPVC product line.
Coming to bathware. Before that I’ll just brief you that our construction work at Kanpur plant is on where we will be starting the first manufacturing of water tank shortly and then we will be starting especially the PVC pipes from the Kanpur plant shortly and our pipe production, as we had said in the last call is already started in our Andhra Telangana plant as projected and guided in bathware. Guided. We are targeting in bathware a revenue of 120 crores for this vertical in this fiscal and we are already on the line in our sales achieve this target and we have already reached 83 crores of sale in nine months and we are confident that we will cross this guided range and guided number in the current fiscal.
We are also launching new SKU in both faucet as per the requirement of the market and this sku we are expecting good response and good market in the coming months as we have done a market survey shown these new products to the targeted consumers and there is a very very positive response on this new range. Slowly our bathar Products are getting recognized in a very prestigious in very prestigious projects in India and we are expecting good numbers, group growth and very good establishment of this product line in coming years in this Indian market adhesives.
Our India operation is continuously delivering a good growth in Q3. It has delivered a very healthy growth of 14.5% with a very healthy EBITDA of 16.4%. Our Dahej plant is gearing up very fast which is a state of art and totally automobile plant. And shortly we are planning to organize the visit factory visit of the investor so you can all see the plant. Mr. Hernande will coordinate with you on the same. We are also working for few new products in the shared verticals and we are going to launch these products in the coming time.
During the quarter our overseas operation was passing through a slowdown but the slower economic activities we have taken some corrective measures and we will bring back the growth as well as the EBITDA from Q1 as we had already communicated. But in this quarter the company has only grown by 5% but it is with a positive EBITDA of 0.7 to 1% so we are not incurring any minus losses there. We have taken multiple steps in UK and US businesses and all this reflection of these steps in the value terms will be seen from Q1 and Q2 onwards there will be a very very positive level of growth, positive level of improvement of EBITDA and lot of new products are getting launched in US market which is getting good response. Already a few products are launched have been launched in this quarter which has got good response from the US market. Some corrections are being made in the US business on manpower level which will reduce our overhead costs in UK also we are now going backward in one of the technologies which we have bought over from Europe. So that is going to add margins as well as we are going to rationalize the purchases in India and UK on a mass level which will also help the UK as well as India plant. And we have made a few corrections in the manpower cost there in UK which will be also reflected in coming one or two quarters.
Now coming to paint business. Paint is slowly entering in new cities. In Astell Grant in Gujarat we have done key big cities where Astral brand is started moving to the end consumer to the dealers. But we have recently made open the state of Rajasthan and we have made a official launch in the state in Jaipur. The first few check months in Jaipur was very positive for Astel paid. Astel Paint has started going in the Jaipur market and Various cities of Rajasthan we are going to open one by one in the coming months. So we will be focusing on two states as present for next three months that is Gujarat and Rajasthan and then we will move to two more states, Maharashtra and MP in next five to six months. Established, see, establish reaches all these markets and we get a good growth.
At the same time in the southern market we are now core focusing where we are strong in GEM Paint brand to focus and get a good growth from the GEMP brand. And that’s why in this Q3 we have registered a growth of 7.5% in top line and we have maintained EBITDA of 4%. The overall the GP is only almost maintain only 1 or 2%. The major thing is that we are launching Astel brand in various markets. So we are just keeping in mind that we are not getting into any negative EBITDA or negative margins but the manpower cost and certain launching costs are getting added up to the bottom cost which has reduced EBITDA which again we are foreseeing to get into a double digit number shortly in one or two quarters in the paint business we are expecting the post budget sentiment of industry should improve and we are expecting good allocation of money in infrastructure from the government and this is going to boost up the growth of economy and building material segment in a big way.
I will now hand over to Mr. Inannand our CFO and executive director for financial numbers and in the question answer session I will be always there to answer all your queries and questions. Thank you very much everyone.
Hiranand Savlani — Executive Director and Chief Financial Officer
Good afternoon everyone. Thank you for joining this Q3 earning. I think Sandeep has already explained that the Q3 was a challenging quarter for the industry. But in spite of that we were in a better position that we have maintained our margin whatever we have guided for the pipe vertical 16 to 18% EBITDA and adhesive at India operation between 14 to 16%. So we are very well on the track and overall on a consolidated basis also we have delivered a 9.3% growth into the EBITDA while the industry was struggling for the margin. This quarter even paint has done a reasonably good growth of 7.5% in spite of slowdown. And adhesive India operation has also delivered a growth of 14.5%.
Now I am giving you the individual vertical wise number for sales and EBITDA. The pipe this quarter was 990. Paint it was 50 crore. Adhesive 280 crore UK 77 crore. So total 1397 and bathware which is included in the Pipe was close to about 27.9 crore. So close to about 28 crore rupees and EBITDA level pipe 18.47% paint 4% adhesive India operation was 16.36%, adhesive UK 0.65% and over consolidated wages 16.5%.
If you see in our press release our GP is the highest on a nine month basis in the history. However it is because of lower polymer price we are unable to take the advantage in top line and consequently it is affecting Suzhai beta also. But in spite of that our EBITDA margins are comparatively very very healthy and within the guided zone. But now due to base effect of lower polymer price we are seeing a good improvement in top line in the coming quarter because the base is low. So now we are seeing that little bit increase in the polymer price is going to help us into the top line growth in the coming quarter.
As you know Astral is always believing in the profitable growth and our focus will always be on a quality product company. Our customer know very well that brand Astral is quality company and therefore they are happy to pay us the premium for that. In recent quarter many companies have deteriorated the quality standard just to push the extra volume and take the short term advantage. But Astral believe in the long term story and we have never compromised in the quality of the product. We can proudly say that today very few companies are in market which give the quality product as per the standard and Astral standby on the top in the market on these parameters. Our focus will always be on the value added product which you can see in our numbers where industry players are struggling for the margin. We are able to maintain on the highest margin percentage in the industry. This is possible only because of the quality product and increased share of the value added product.
Market Also delivered a good number during the quarter in Q3 it has delivered a top line growth of 27.9 crore versus 18.9 crore last year Q3 which resulted in a growth of 48%. And on the nine month wages also if you see we have delivered 64.5% in the bathware vertical. So whatever we have guided that we are going to deliver 100 to 120 crore in the beginning of the year. We are confident that we are going to cross our guided zone of 100 to 120 crore.
Sprinkler Sandeep has already explained that now you got the UL certification which is going to help us in a big way in the coming time in the project business as well. As in the international market so we are now going to open up in the Gulf region also in the European side also this product. PTMT has already launched and people are appreciating our quality and we are high confident that this product is also going to give us a reasonably very high number in the coming time.
Rrecently company has opened up a marketing office in Dubai and we are now targeting to the export market for uae, Gulf and Africa and we are expecting that this office is going to help us in a big way to enter into the export market for all our value added products as well as the ADESU products. During the current year we have increased the capacity by 36,000 metric ton from 334 to 370 metric ton okay, sorry.
Nnow with this I am opening up the floor for Q and A thank you very much.
Questions and Answers:
Operator
Thank you sir we will now begin with the question and answer session Anyone who wishes to ask a question may press star and one on their touchstone telephone if you wish to remove yourself from the question queue you may press STAR and two Participants are requested to use handsets while asking a question Ladies and gentlemen we will wait for a moment while the question queue assembles.
The first question is from the line of Shravan Shah from Daulat Capital Please go ahead.
Sandeep Engineer
Can we move to the next question because he’s not replying.
Operator
Yes, just give me one moment here Sir, I would just request a few moments due to some technical difficulties. The first question is from the line of Shravanshah from Daulat Capital Please go ahead.
Shravan Shah
Hi sir, can you hear me now? Yes sir, we can hear yeah Sir a couple of things first on the plumbing volume so for nine months we have done just a 4.3% and we were looking at 10 to 15% for this year so now what’s the revised guidance for this year and if possible for next year how much growth one can look at.
Sandeep Engineer
I think it is difficult to give the volume guidance exactly under the current situation because we are too much dependent on the how this budget, government spending and all is happening Because a lot of crises are there into the liquidity side in the system. Secondly much awaited anti dumping duty we don’t know when it is going to be announced by the government so if that is going to come then the definitely volumes will be very high in the Q4 but if that is not going to come then volume will be slow so it depend to subject to that we will be able to tell. So we are waiting for that and then we will be able to tell exactly what is going to happen. Both things will happen. That yes, definitely we can deliver a double digit number in the Q4 also. But if it’s not going to happen then it may be a single digit also.
Shravan Shah
Okay, got it. And second sir, in terms of the margin in plumbing is for nine months is very good. 18.3%. Though our range was 16 to 18%. So how one can look at. Is there a possibility this margin range 16, 18% can. Can be now on the higher side once start building in?
Sandeep Engineer
No, I think my range will remain same only now our focus will going to be more of the volume than the margin only I think margin we are based in the industry. So now our more focus will be on the volume rather than on the margin.
Shravan Shah
Okay, okay, got it. And in terms of the this is because though we are saying a 14 to 16% margin combine everything but till now is just 11.4%. So obviously you have mentioned that UK will start now throwing up positive EBITDA. Just trying to see how one can look at in FY26 itself one can start looking at 14 to 16% adhesive margin.
Hiranand Savlani
Yeah, yeah. 14 to 16 we have given the Indian operation. UK had never given that kind of margin. So our Indian operation will continue to give us that range only. Even if you see that this year number also the adhesive division has delivered a margin of I think 16.36 in this quarter. And on a nine month basis it has delivered 15.97 so close to 16%. So India operation is going to deliver the similar zone of 14 to 16%. But UK yes, definitely one more quarter we needed for the improvement because we have done the correction. We are expecting to improvement in the Q1 onward.
Shravan Shah
So for full year next. Sir, how one can look at a UK margin?
Hiranand Savlani
Sir, UK margin will bring back to that 5 to 10% which has been a historical margin and that the steps we have taken would reach there. The market growth and all depends on how these local markets function. But we are sure that we will not be de growing anywhere. But we are confident to get the margin level up. Because US merges with UK as a number. And we have also taken many steps in the US but for certain markets, even if you reduce your cost in the manpower or any other cost, there is a cycle where the reduction can be seen. You cannot tomorrow go and say that now today I have 50 people and tomorrow I need 40. But there is a cycle where Phase wise these costs reduces. So these steps which we have taken to reduce all these overhead costs and certain cost still maintaining the business will be actually reflected in one or two quarters from now. And we are categorically saying this that all steps taken whether there or whether in other businesses will be reflected. And we have always guided the market in the right direction from day one, from years together. But there are rules of the country, there are regulations of the country which come into source and that all cost reductions of certain levels take three months to six months and which will be reflected.
Shravan Shah
Got it. And lastly sir, is it possible to share the India adjustive absolute revenue for third quarter and for nine months?
Hiranand Savlani
This third quarter 280 crore.
Shravan Shah
And for nine months sir, nine months.
Hiranand Savlani
Nine month adhesive revenue. One second I have to check.
Sandeep Engineer
We can within with our questions we’ll answer it. Otherwise we can move ahead with the other.
Hiranand Savlani
697.
Operator
Thank you. The next question is from the line of Sneha Talreja from Novama. Please go ahead.
Sneha Talreja
Thanks a lot for the opportunity and congratulations on strong margins. Just to follow up to what you just said that you know now the focus will be on volumes and you know margins you are already doing the highest. Firstly would like to understand how did you manage to do this margins on a quarter on quarter basis higher given your volumes were flat. And from here would you be following the strategy of discounting on pricing as done by many other players to gain volumes. And if that’s the case, what is the outlook we should expect in terms of volumes?
Hiranand Savlani
I think volume depend on the industry, how it is going to perform. So our normal range will be between 10 to 15% in the volume. That is what we normally work. And next year also we are expecting that we should be definitely going to deliver between 10 to 15% minimum. Because now the base will also be low. Because if the current year single digit growth will be there then next year base will be low. So because of that we can easily grow 10, 15% in volume. But if the market conditions are good like whatever was there in the last year, we can deliver even 15% plus. Also it depends how the economic scenario is going to develop. How the infrastructure spending is going to be there in the system and how the real estate demand will be there. Based on that it will be decided. But yeah, definitely growing between 10 to 15% should not be the challenge looking to the lower base of the current year.
Sneha Talreja
But this would come along with discount.
Hiranand Savlani
Yeah, yeah, carry on.
Sneha Talreja
Sir, I was just asking the same thing. But would this Come at the cost of discounting in terms of pricing which everyone is doing now. Or would you follow the same strategy of being premium?
Sandeep Engineer
We are not discounting anyway. When you see in the past quarters also we have not sold any of the product at a discounted rate. So there is no question of discounting the thing. See ma’am, I. Let me be very categorily very clear about things that if the market is having a size where even by discounting your people have seen results, people are not. So it’s always better to keep your healthy margins because discounting in this consumer industry is like once you discount your product and bring that margins of the discounts down to distributors, dealers and in past also we have seen and which everyone will see is to bring back the price level or reduce those discount level is a big process which if I do it today and even I don’t build a volume to bring my discounts back to normal will take me six months to one year. Because the market keeps on expecting whether it’s a dealer, distributor, consumer. So looking to the scenario of the market and looking to the basic thing which is not there is if you see the consumer, the spending of the private sector is there. We are all selling, we have been doing business, we are going. But the government segment is a buyer. The people who are supplying to government segments are also coming in the same market.
So practically as the spending comes back, as the economy starts turning, which we’ll see after the budget, we don’t see any issues of volume growth, value growth and things going up. And we will stick to maintaining a healthy EBITDA that will be always there. And we are selling value added products. We are selling costly products and we are selling products which carry more value and margins which is reflected again and again in our results.
Sneha Talreja
Thanks sir, that was helpful. My second question is on the exports front. You mentioned couple of geographies, Middle east, you have opened up office at Dubai and you know you’re planning to do exports to European countries currently what portion of your revenues is, you know, coming from Exports? Is
Hiranand Savlani
Differentiate and give these numbers please. We have not differentiated given these numbers but we are expecting a positive and we are getting positive orders for our certain value added. But we won’t be able to give you numbers on exports.
Sneha Talreja
Understood. Just a clarity or this is only fittings, right? Not pipes?
Sandeep Engineer
No, no, both. Both. Pipe and fitting both.
Sneha Talreja
Understood. Quite helpful. I’ll come back in the queue so thank you and all the best.
Operator
Thank you. The next question is from the line of ABHISHEK from dsp. Please go ahead. Yeah. Hi sir. Thanks for the opportunity. So just couple of questions in terms of, you know you’ve grown, you’ve basically been flat but you have maintained your margins. Well, is it fair to assume you would have still maintained your market share? Just to understand the industry growth, how should one look at that perspective?
Hiranand Savlani
Definitely. Because if you see the industry, industry had not grown in this nine month Beijing hardly 3, 3, 4% growth is there. So we have maintained our whatever the market share is there. So we will not maintain the margin at the cost of market share. We are not going to lose the market share and maintain the margin. That will never be the mindset of the management.
Abhishek Singh
Correct. So sir, in this light how should one look at it? Because is it because of channel destocking? Because otherwise if you look at the pipe industry usually grows at 7 to 8%. So this should also come back over a period of time as Sandeep was kind of hinting at. As channel inventory normalizes. Is that the day one should look at it overall growth from next 12 to 15 months?
Sandeep Engineer
No, it should happen in a short time I feel because channel destocking is one thing but the uncertainty of polymer whether it will go up will come down. Whether it’s what is it or open market what is the price of the biggest manufacturer of India. All these ambiguities and the ambiguity around what will be the effect of the anti dumping whether it will go all these ambiguities which prevail within the market plus spending from the infrastructure spending from would be settled down in next two to three months. There is nothing that remains ambiguous or always. And then the market will start accepting. Market will start putting material back in the channel and market will start growing at its normal pace which we have always guided 10 to 15% around.
Abhishek Singh
Okay, okay. But you are saying sir, today there is an issue with primary sales and secondary is still fine. Would that be a fair estimate to make? Sir.
Sandeep Engineer
Both are going parallel. I can say secondary is also doing excellently well. I don’t say there is. These are type of things which is over panicked rather than these are the phases which always comes in the business cycles of business. There is no over panic situation which you can say is a big concern on anything it flattish a speedometer guide is there slowly road, clean road and it will bump up to a higher speed.
Abhishek Singh
Very, very helpful. But just one other thing as astral when you aspire to grow at that 15 to 20% in that one is obviously market growth rate has to support. But you think there are still gaps as far as distribution and region and over the next two, three years you know you can work around it to accelerate as far as market share gains and growth aspect. How should one look at that?
Sandeep Engineer
Basically there is. We are there at every nook and corner of India but there is. This is a thing which for years and years will continue and we are adding good distribution network where we feel that we need to strengthen this up or we are getting a good distributor by keeping and safeguarding the existing distributor as well as we are also keeping our focus on the rural markets. So overall network growth and distribution addition is always continuing and will continue with escrow.
Abhishek Singh
Got that sir, thank you so much. Thank you so much for answering my question. Wish you all the best.
Operator
Thank you. The next question is from the line of Rahul Agarwal from Ikigai Asset Management. Please go ahead.
Rahul Agarwal
Yeah. Hi, good evening Rahul from Akigai. Sir, three questions. Firstly to start with January 2025. How’s been the start is good. Qualitative comment on you know plumbing infra demand and I know astral is smaller in agri but just your sense.
Sandeep Engineer
I think demand is good. We don’t see any problem in the month of January and we are growing.
Rahul Agarwal
Okay. So it’s like should be a normal kind of double digit kind of growth for the industry. I’m saying.
Sandeep Engineer
Let we finish January then we will be able to know exactly what is going to be there. Let’s not get into these things because any scenario which we predict today is not too early to predict. Let’s not go month by month. Let’s see the quarter by quarter and we as Hiranandbai said things are positive and they are positive in the value and volume terms of the month.
Rahul Agarwal
Got it sir. Hiran bhai, for nine months what is the operating cash flow and capex which the company has done?
Hiranand Savlani
I don’t have a handy number. You can call me maybe post this phone call.
Rahul Agarwal
Okay, no problem. And the CAPEX budget for the full year roughly if you have fiscal 25 and 26.
Hiranand Savlani
I think we should be closing around 450 crore or so for the full year.
Rahul Agarwal
And for the next year.
Sandeep Engineer
Next year should be somewhere around 250 or so. We have done most of our plans now. We are not going to add up any new facilities because we are now Kanpur is almost completed. So I think next year the capacity cycle will come down drastically on the addition of capacities here as well as in a desert. Paint as we have Already said that we have not done any Capex after this acquisition except a few here and there corrections and we will continue with that because we have a good capacity there. Faucets also we have not done. We just did 23 crores asset buying and that plant has slowly doing most of our products and we have expanded there by spending few crores and so we have a very good state of art facility to help us. So next year as Iran and we guided the capex cycles will be trimmed down because we don’t need so much additional a new land or a new building except a few machinery additions will keep on happening.
Rahul Agarwal
Got it Sandraji. And one last question was on aggressives qualitatively it could help us understand how is the India business behaving. Obviously the numbers are Good, we’ve grown 14.5% for the quarter but just in terms of pricing and volumes and the hedge ramp up, could you just qualitatively comment on how does the market look like next 12 months?
Sandeep Engineer
If you see we have steadily built our brand bond type in the market all our products are doing excellently well whether it’s now 0.5mg the ampoule is selling well, our epoxies are selling excellently well. Our white flu is picking up as well as our product lines of cyanoacrylates, the silicon, the hybrids and all the construction chemical is slowly also ramping up. So overall adhesive, the saddle is very slowly and steadily going up. Solvent cement would be almost the biggest in India and the hedge plant for white clue is fully operational. We took all our key dealers and distributors there one and a half months back and they were excited to see the fully automized plant.
Epoxy is the whole range is made there. We have advantage of raw material which we now buy in bulk at the hedge plant which is helping us and everything is being automatic is saving us the cost on the spillages or things but especially the formulations have become so standard that our yield also has improved. So the hedge plant has added a great value to the Adasu business. We learned a lot from that and we’ll continue to learn and I think in Adasai business the way the growth is, the way the margins are and the way the established things are happening we see a great future of these business for years to come.
Hiranand Savlani
I think I can add this that I given the nine month number for ADCU that was wrongly I taken the different columns so the real number is 782 for India operation for 9 months and UK is 258 for 9 months. So total is 1040 for the 9 month and this quarter India operation is 280 and UK 77. So 357 for the this quarter.
Rahul Agarwal
Perfect sir, that was just a clarification also I would need it. Thank you so much sir, all the best.
Sandeep Engineer
Thank you. Thank you.
Operator
Thank you. The next question is from the line of Keshav Lahoti from HDFC Securities. Please go ahead.
Keshav Lahoti
Thank you for the opportunity. So what is the sense on the ADD which we are talking on pipe side?
Sandeep Engineer
I think we are expecting that this one should come post budget should come.
Keshav Lahoti
Okay, that is great to hear. And the sense on channel inventory is it normalized inventory or you would say it is still subpar?
Sandeep Engineer
No, no it is subpar because so much of volatility there and nobody has a confidence so because of that nobody will be happy to have the inventory.
Keshav Lahoti
I’m asking you this question because what we have seen, you know raising prices has not been volatile in last three months and there are talks of add so the chances of you know prices increasing is more. So why is the challeng not getting back to normal inventory.
Sandeep Engineer
Still market is talking about downward trade so very difficult to understand that somebody is telling that cost some price is going to drop. Somebody is telling me that this basic duty in this budget is going to go up from 7.5 to 10%. Somebody is telling me that in the post budget immediately the anti dumping duty will come. So a lot of things are moving in the market so very difficult to know what is exactly happening. So same thing is going to happen with the dealer and distributor. So everyone is talking the different language.
Hiranand Savlani
And channels eEvery company has a stock so even something comes up it will take some time for anything to be implemented and see the reason.
Keshav Lahoti
Last question from my side what sort of pipe capacity you will be adding in this year plant wise and next year also.
Sandeep Engineer
This year we already added 37,000 metric turn in nine month wages and I think little bit more can be added in the Q4. Next year Kanpur ones will be operational and then silimal capacity addition will be there, another 30,000 or so will be there minimum and then some correction at the individual plant level. So maybe another total 40, 45,000 can be added next year.
Keshav Lahoti
Total size is 60,000 or total is 30,000 because Kanpur was in two phases.
Sandeep Engineer
Total will be 60 so it will be in two phases first will be 30 and then the second will be another 30.
Operator
The first 30 would be coming this year right? And another 30 next year.
Keshav Lahoti
Yeah. Okay.
Sandeep Engineer
30 will be coming to 26 and 30 will be coming to FY27. If the demand scenario will be good and we get a good response we can prepone also because there only we have to aid the machine, building is already in place.
Keshav Lahoti
Understood. And had the other 70,000 out of that how much is done this year and how much will be coming up?
Sandeep Engineer
So we already completed I think 25,000 metric done. Once that 60, 70% utilization will be there we may add to next year to that also.
Keshav Lahoti
Understood. Got it.That is helpful. Thank you so much sir.
Operator
Thank you. The next question is from the line of Ritesh Shah from investsec Capital. Please go ahead.
Ritesh Shah
Thank you sir. Sir, can you provide some color on Tanks, Walls and RainPro separately given this were the growth drivers that we had identified a couple of years back. So what the progress has been if you can provide some numbers.
Sandeep Engineer
So these products are going as per the plan and whatever we have guided as them being the growth driver they are currently doing very well and they are selling as per our budgets and individual category numbers we don’t want to share but all three categories have picked up and they are doing very good and we are ramping up the capacity for valves also we are introducing some new ranges going ahead and even with tanks we are slowly and gradually adding tank machine at every manufacturing location. So latest was added in Hyderabad and now with Kanpur it will be also added in Kanpur. So we have a very good response for all these products and they are doing very good.
Ritesh Shah
If I had to put the question the other way around we have been reporting pretty solid profitability on the standalone business which also includes a contribution from Tanks and Walls. If we had to strip out Tanks, Walls and Rainfro what would be the profitability like? I’m just trying to understand the competitive pressure and how are we managing it. Is it more because of value added products.
Sandeep Engineer
Very hard to give the individual that segment wise number how can we give. Number Can I give you for profitability separately.
Ritesh Shah
Okay, let me put it the other way. I think couple of years back we had given a three year target for the growth engines that we had indicated. I think the number was given 1500 for something. How far are we on that?
Sandeep Engineer
So we are very well on track. Very well on track. I can say it that way.
Ritesh Shah
Okay. Okay.
Sandeep Engineer
Without that. Without that Ritesh, how can we maintain our profitability in this competitive.
Ritesh Shah
Right sir. So what was trying to understand is our focus has always be on quality and brand. Correct. But we also have this incremental contribution from the new growth engines which is also helping us on the profitability. So was just trying to understand if one had to dissect this just to gauge on a pure piping business, how are we firing versus the peers. If you could provide some color, it would be great help.
Sandeep Engineer
We already communicated that we are doing as per the plan. What else I can communicate? Tell me.
Ritesh Shah
Sir, I’ll take it offline. No worries. Sandiphy, you did indicate for UK we have done some additional backward integration and we bought some technology from Europe. It is likely to aid margins. Can you detail this please?
Sandeep Engineer
I think we have just signed the agreement. So in the Q1 that will be available to us. So once it will be ready we will definitely going to communicate exactly what that technology. Right now we have signed the agreement and things are moving on. So in Q1 that will be available to us and then we will definitely announce everything.
Ritesh Shah
Sure. Thank you so much. Thank you.
Sandeep Engineer
That’s going to help the India operation also.
Operator
Thank you. The next question is from the line of Praveen Sahai from PL Capital. Please go ahead.
Praveen Sahay
Yeah. Hi. Thank you for taking my question. Sir, if you can give the. How much is losses in the bathware segment for this quarter and nine months.
Sandeep Engineer
I think hardly any losses are there. We don’t now separately work out because it is already merged in the pipe. And secondly, many of the pipe related brass fittings are manufactured at the same plant. So very difficult to segregate the EBITDA of pathway. But I think hardly, hardly any losses will be there. What we guided that by this year we are going to be breakeven. So. Yes, definitely. So next year some contribution will come from that vertical also positive.
Praveen Sahay
Okay. Secondly on the paint segment from the last two quarters, the second quarter and third quarter we had seen a lower margin of a single digit. And definitely I understand because of a lot of marketing activity you had a, you know, done so so when you are expecting these numbers margin front to improve in this segment.
Sandeep Engineer
So like last quarter also we communicated that this is the launch state going on. So we are continuously adding the team, also adding the dealer distribution also and spending a lot of money on the branding also. So because of that lower EBITDA will be that because our base is very low. If you work out in an absolute term it will not be hardly anything. But in percentage terms it looks very high because of the lower base. So when that part will be over then definitely you will see the improvement into the margin. So next year I think from second half Onward you will see there will be a good improvement into the margin.
Praveen Sahay
Okay. And related to the adhesive business you had done very well in the last nine months. Even the quarter if you can give some more color. Obviously you had a given some. Is there some color on the geographical expansion as well? Because in your competition commentary they had a highlighted that Gujarat or Kerala market is little on the slower side. So is that the geographical expansion is benefiting you or also if you can give the the hedge plant utilization as well.
Hiranand Savlani
I think we can’t share you the individual geography wise number. We are still a small company so I think doesn’t make much difference to us. So. But yeah definitely the hedge plant is helping us in a big way. It’s a state of art plan. Backward integration is also there. So really good plant is that. That is definitely going to help us to improve our margin. And that was the objective of putting that plant. And I think we Sandeep has already invited everyone to visit the plant. So we are fixing up the date in the month of February and I think Ritesh is coordinating for that. So anybody can come and join that meeting and you can see live how the world class plant we have put up completely hundred percent automized. So definitely it is going to help us in the coming time.
Praveen Sahay
Sure sir, we will definitely visit. Last question is related to the pipe business. Sir, I understand there is some demand and the add everything has impacted but how is the CPVC business as a segment for you and as a foreign industry is behaving? Because.
Shravan Shah
CPC segment is doing good for us and overall also otherwise this margin profile in the piping business will not be possible also to give right.
Praveen Sahay
Because one of the competition is talking about very high growth in this segment. So that’s why I’m just wondering how is the being a market leader, how is behaving for you as well?
Hiranand Savlani
We have been doing good. We’ll continue to do good and it always reflects in our working and we don’t want to break up and share because these are our confidential numbers. But yes obviously we have been doing excellently well in this segment. CPVC is our bread and butter. If that segment is not going to help us how can we maintain 17, 18, 18% kind of margin. So definitely it is doing well. This particular part of PTC was the challenge and that is across the industry. It is not only for us across the industry. This challenge was that. And we are of the view that that will also be improved in the coming time. Because India is going to grow at 7% GDP then definitely pipe market has to grow at 8 to 10%. If that is the case we can easily grow more than double 10 to 15% easily we can grow a temporary phenomena and lot of liquidity challenges are there in the market. So definitely that is going to be addressed by the government in the coming time. Thank you sir and all the best. Thank you. Thank you.
Operator
Thank you. The next question is from the line of Akash from UTI Mutual funds. Please go ahead.
Akash
Hi. Hi sir. Am I audible?
Hiranand Savlani
Yeah.
Akash
Hi sir. Thank you. Just wanted to ask sir, for 9 months FY25 what is the gross margin in adhesives business? India as this is business.
Hiranand Savlani
Gross profit margin on a nine month basis. It was 39%. Sorry for 39 is the pipe and a day. See it is again 39.6.
Akash
Sir. And same number for nine months FY25.
Shravan Shah
No, no, no no. See nine month it is 44.9% in India. 44.9.
Akash
Right. And so same number for nine months FY24.
Hiranand Savlani
24 it was 42.74.
Akash
Okay.
Hiranand Savlani
So 2% improvement.
Akash
Okay, sure, sure sir. Thank you. And sir, also just wanted wanted to hear your thoughts on how the new Bharat initiative.
Hiranand Savlani
Is doing for adesu’s business. Doing good and as potters evolve we’ll. But it’s doing good. It’s doing good.
Akash
Yeah sure sir. And sir if you can share how much is now rural contributing to addresses.
Hiranand Savlani
These numbers for our interest.
Akash
Okay, sure, sure sir. Thank you. The next question is from the line of Devang Shah from Asit C Mehta Investment Intermediates. Please go ahead. Hi, good evening sir. Congratulations for a you know good set of number in challenging environment. I have a couple of questions. My first question is we are seeing some kind of you know, muted revenue growth so far as far as you know in general we by considering the fact of your overall piece of revenue historical base is concerned. So I just want to see how you know we can expect a top line to unfold. As you have already mentioned budget and that will be a key decision. But as far as numbers is concerned, you know Last year in FY24 we have 24. We have grown top line somewhere close to 9% while your historical average was somewhere close to you know 15% kind of band. So you know moving forward what kind of you know growth as a percentile we expect you know in the coming years.
Sandeep Engineer
See if you see the last two year current year. In the last year our top line growth was low compared to what Historical levels were there mainly because of the drop in the polymer price and the chemical prices. So both our business affected in the top line because of drop, heavy drop I can say into the polymer price and the chemical price. So now we are seeing almost bottom is there. From here on we are not seeing a much drop into the polymer price or maybe a chemical price. So it’s a question of only time when it is going to go up. But if you see the last year our volume numbers were fantastic. But that is mainly because of the value was not there. It looks like a 9% kind of growth. But this year we are of the view that volume should be low than the value. So value will be growing faster than the volume. So hypothetically my volume growth will be 10 to 12% then the value growth will be 15%.
So this year because of the base effect, we are of the view that the value should be better in FY26. That is how. And we will be back to our normal growth of 15% kind of job. And if the market conditions are improving in a better way, we can grow even better also. But you can consider that level of 15% kind of growth.
Devang Shah
Okay. Second sir, we have seen some kind of, you know, in your quarterly numbers there is a raw material cost that has been, you know, inched up. And there is also one, you know, exchange rate fluctuation kind of cost that has been there mentioned over there. Can you throw some more light on that especially exchange fluctuation cost somewhere? And also the about the raw material, why it is inched up in this particular quarter.
Sandeep Engineer
So like exchange fluctuation is mainly because we are importing a lost raw material from overseas. So because of that, the dollar fluctuation whenever it is there, like if you see limit, the last quarter prior to that rupee was stable. So exchange fluctuation amount will be very low because there were no volatility to the currency. But whenever there is a volatility into the currency, this fluctuation comes. But compared to the earlier years now the volatility is comparatively low. If you see the yearly wages number, it is not going to be very high what used to be three, four years before.
And secondly, our dependency on imported material day by day is getting reduced. So that is also helping us to mitigate that risk of exchange fluctuation. As far as this raw material plus that is mainly because of the inventory plus, minus. If the inventory goes up, then it will be plus. If inventory goes down, it will be minor.
Devang Shah
Okay, so sir, then in this particular quarter we have seen a Significant depreciation on a rupee will it going to affect in your Q4 FY25 as far as exchange fluctuation is concerned this particular week.
Sandeep Engineer
Exchange fluctuation whatever happened in December that is already reflected in the number January. I don’t see there was a much depreciation. Maybe. And if the wallet will be there we over a period of time we readjust into the gross profit margin. Because ultimately we have to pass through that to the market. It’s not we but entire industry ultimately has to counter cost accordingly only. So ultimately this will pass on to the market. But in bookstore account it will show like that the loss or profit. But ultimately it is passing on to the market only.
Devang Shah
And sir, your aspiration to be maintaining such kind of ebitda margin of 15.5 to you know 16. That would be the basically your aspiration, right that you are going to continue in the coming years.
Sandeep Engineer
Correct? Correct. Correct
Devang Shah
Answer last question. That as we mentioned budget will be somewhere key decision as far as infrastructure spending and domestic growth is concerned. So do you have you know the tariff war. That is something you know now the you know from the you know us somewhere we are you know voices now yu know making loud and loud again and again. So will it impact us as far as our performance? Because you know domestic boost will be as per the dependency on a budget. But what’s your outlook as far as you know if there is any kind of tariff war as far as overall business is concerned.
Sandeep Engineer
As far as Ashtal is concerned we are not exporting anything to the US market. So I don’t think we are going to neither we are importing from us. So I don’t think it is going to affect our company. If India doesn’t grow then we may be affected. But otherwise I don’t think this tariff is going to affect any way to our company.
Devang Shah
Okay. Okay. Thank you so much sir.
Sandeep Engineer
Thank you. Thank you.
Operator
Thank you. The next question is from the line of Amit Purohit from Elara. Please go ahead.
Amit Purohit
Yes sir. Thank you for the opportunity. Just on the industry growth you indicated nine month. The industry grew by 3%. What would be the plumbing and infra. If you could give some sense on that. And second is there are a couple of new product launches that we would have done. Is it possible to share what is the share of those? Like it could be BPR or a low noise kind of product portfolio in the plumbing segment.
Hiranand Savlani
See the industry number which I have given that I have given a tentative based on my internal assessment it is not a published number so far. Sure, sure. Will be known only by the year end. Okay, so I can just clarify you that thing. As far as the individual is concerned, I think very difficult to work out how the industry has performed in an individual vertical. Maybe agriculture or maybe plumbing or maybe other vertical. So it is very difficult to work out that number into that. As far as our growth is concerned I think low noise Ren Pro. All these products were all already launched few years before. It is not that this year it is being launched. And initial year was the naturally struggling year. But now these products are picking up. So we are definitely going to deliver good number in the coming time.
Amit Purohit
Just looking is possible to share some salience in terms of whether it’s mid single digit or low single digit.
Hiranand Savlani
Individual we cannot share.
Amit Purohit
Sure, sure. Okay. And lastly you highlighted that anti dumping duty probably will help. But this if even if this happens in Q4 there will be a jump up in Q4 because of the stocking up by the dealers and all post that it will again back to the demand growth rate.
Sandeep Engineer
What depends on when the government implements it depends on multiple factor. Depends on when they implement. Depends on how much provisional duty comes. What will be the rupee impact. Okay, so it depends on a lot of factors. And also depends on whether the demand goes up. Because restocking can only happen up to a certain level. After that if the demand does not pick up then people will not stop just because the price of the polymer is going to go up. I think that will be the sentimental wise. It will be really positive for the market. And then the market will very clear that from here on the prices will not go down yet is the main thing to understand from the market point of view. Because then the dealer distributor will get the confidence that is what needed at this point of time.
Amit Purohit
Sure sir. Thanks. That’s it from my side. Thank you. The next question is from the line of Rishabh Bhotra from Anandrati Share and Stock brokers. Please go ahead.
Rishab Bothra
Yes sir. Two, three questions. Firstly on the paint side there’s a lot of high tech end competition in the market. So how are we progressing in terms of penetrating the market in new geographies?
Sandeep Engineer
Let us be very frank that when we bought the paint market compared to the size of others we have never acquired this business to go and create a huge huge market. We have. When we acquired a market business the giant was in multifolds and folds. And we acquired 150 crores worth of business where we had similar Questions and we said that we’ll continuously grow deliver at 15 20% pace. We kept on doing our best maintained margin. And over almost nine to 10 years a category properly is created with the proper margin. And slowly and steadily it is growing reaching the nooks and corners of India.
Now here also we are acquired a business with a size of around 200 to 50 crores. It’s not that we want to reach the India overnight or create any magic with a one stick. We are very clear that this is going to help us in our construction chemicals division in a big way. The painter segment and our dealer network also will be extended. And which is our motto to grow at a normal pace of it should not be below double digit, which is obviously there, but not at a exorbitant pace by fighting in the market, creating negative betas or spend overspending anywhere in the cash burning to do marketing. So I don’t understand the panic of paint business which is only not even 5% of our business. And we are very, very categorily clear that our eyes, ears and our vision is on that. But again, no magic wands. We have opened, we clearly said in my opening remarks. Gujarat, we are slowly penetrating Rajasthan. We have opened recently in last month, two months and we will penetrate. Then we will go to another two states.
If I want to open the Pan India, it would be disaster for Astel, which we will never do by employing so many employees or overstretching in capital expenditures or doing anything for heavy marketing budgets. But give us time, give us time of a few years and you will see a continuous growth with a positive ebitda, no cash burn and a vertical which we created at a range. We will call it paint and construction chemicals division. We want to get construction chemicals move into paint because that’s the right segment and the right audience to grow construction chemicals with the paint business together. So please understand and please don’t have any panic that we have done doing anything wrong here. Whatever business is offset was the same thing. You see, after two years plus two years we have reached three digit plus. And we are there with the capacity to grow, range, understand the business and continuously deliver the growth numbers.
And similarly here we are very, very conscious and we are driving it in the best ways possible. Hiccups do come in new business. Learning Curves come pluses, minuses come the same came. We have always told the market about pluses, minuses, hiccups up and down curves. And the market was always being posted in the right direction, which is the philosophy of Astral Family and please be rest assured that this business or Astral is also equally a prime business but with no magic wands around. But you will see these results in coming few years from now.
Rishab Bothra
Got it.
Sandeep Engineer
So nothing will negative on margin fund which will be always there in our thing and nothing will be overspent here. And no capex is required here for at least few years from now.
Rishab Bothra
Right. So for understanding sake in adesives I believe there were lot of players who came in the market and then moved out. What is the uniqueness with the leader is having such a large market share and what is our market share in the domestic market? I understand that.
Sandeep Engineer
I would not point to what market share. But if you see at 40, 45, 50 years history and if you see just eight nine years history for Astro taking over a company, creating a complete range and making a mark in the industry it’s obviously a great achievement. No one at the number two was being able to stay continuously. Various reasons I don’t want to get into that. But we have these are also challenged multiple times. But we have taken over the challenge and delivered and we have now added a business in our blood pipe. In our blood faucet is in our blood and paint. We are taking it into our blood also.
Rishab Bothra
Correct. But can you split the revenue of addresses into overseas and domestic market?
Hiranand Savlani
So this quarter UK was 77 crore. India was 280 crore.
Rishab Bothra
Last question sir. What would be the revenue share from UP state And is Kumbh giving a positive vibe in terms of volumes or it is slightly restricting growth.
Sandeep Engineer
We don’t have that numbers there and we don’t want to get into those breakups and numbers because lot of distribution is done through our dealer and networks so we don’t get the correct how much businesses are going over.
Rishab Bothra
Got it. Thank you sir. Wishing you all the best.
Operator
Thank you. The next question is from the line of Pinaki Banerjee from Aum Capital Private limited. Please go ahead.
Pinaki Banerjee
Good evening sir and thanks for the opportunity in the previous quarter with regard to your UK subsidy where you had stated that you are bringing a one of a kind of a product in the Indian market with respect to the adhesives. So. And that will be the first time in India. So can you give us an update on that?
Sandeep Engineer
Give us two quarters at least after this fiscal ending. We’ll let you know.
Pinaki Banerjee
Okay. And last question is you have a quarter cash of around 290 crore. So considering the fact that there Is actually a bit of a flattish trend in the industry. How do you plan to utilize it?
Sandeep Engineer
At present we will be not doing any big things but if there is something which is positive, okay. But otherwise we have. We’ll. We’ll be looking at keeping some cash on hand.
Shravan Shah
And adding to it. And next year and all the CapEx as we have been, our cycles have already been from our cash approvals which will be seen on depends on the market.
Sandeep Engineer
I think by year end we will be able to know what is our next year budget. Based on that we will work out our cash utilization plan. And if we don’t have any such kind of utilization plan then we will give it to our shareholder.
Pinaki Banerjee
Okay, fine sir, that’s all for me, thanks. And all the rest for the session.
Sandeep Engineer
Thank you. Thank you. The next question is from the line of Madan Madlani from KamayaKya Wealth Management. Please go ahead.
Manan Madlani
Hi sir. Thanks for the opportunity and congratulations on the margin fund. So my question was from side. So previously if I’m not wrong you mentioned we are targeting 78,000 metric ton capacity. So are we still planning on that? And on the pricing front since lot of players are, you know starting manufacturing opvc. Do you see any supply side pressure or still the demand is pretty much high.
Sandeep Engineer
I think India doesn’t have any capacity of opvc so I don’t think any too much capacity is going to be there. And secondly, you know this machinery delivery time is also very very high. So at least in the coming couple of year we are don’t seeing any over capacity into the opvc. Maybe after two, three years it can be but at this stage doesn’t look like that.
Manan Madlani
So for instance if the. If we are you know, running at a 60, 70, 80% utilization rate and if you are planning to increase our capacity, how much time it takes for us.
Sandeep Engineer
We have planned our machines in a series of sequences and its technology is homegrown. We have kept our capex also for the technology in mind. And we’ll be the first one even to make the fittings in house. Just give us at least one or two quarters as things unfold and progress with the product line will give you a correct and clear picture.
Manan Madlani
Okay, my second question is on PTMT tabs. So how are we pricing them? Like so is it a premium product compared to a regular PTMT tabs?
Sandeep Engineer
No, no. PTMT Taps is not a premium product. And our price range will be close to the market leader in PTMT which is Watertake. Right now Watertech is the market Leader in PTMT across India. So our pricing range and quality will be at par with Watertech. So we are hoping a good volume from that segment. Basically it is not a voluminous product but yes, it is a good margin product. So obviously we cannot expect thousands of tons from of sales in that because it is a tap fixture. But yes, it is a very good product for the bottom line. And also the response is positive, very positive. I can tell you not to get into more deep in that.
Manan Madlani
And on the bachelor side are we like I remember earlier you mentioned you. You have a different institutional, you know, team to cater the institutional side of the business. So how that segment particularly doing?
Sandeep Engineer
We have started getting institutional business from good projects, builders as well as big, big contractors. At the same time our retail presence also is growing and continuing. So we are balanced. Business is happening in the right way.
Manan Madlani
Okay, could you quantify?
Sandeep Engineer
No, sorry. Thank you.
Manan Madlani
And last question. I mean we get that the intra side of the business it’s you know, not getting much traction. But from the real estate side do we still seeing any, you know, contraction or we are seeing any improvement from that side.
Sandeep Engineer
We are having good presence, Japan, India. So maybe a few markets go plus minus. But overall there is a good acceptance and demand coming.
Manan Madlani
Okay, that’s it for my sir. Thank you very much.
Operator
Thank you. Thank you. Ladies and gentlemen.
Sandeep Engineer
I think you can take the last question and then we can close. If anything is left out we can separately handle that.
Operator
We have no more participants.
Sandeep Engineer
Okay. Thank you. Thank you.
Operator
So ladies and gentlemen, that brings us to the end of the question and answer session. I would now like to hand the conference over to Mr. Ritesha for the closing comments.
Ritesh Shah
Thank you. Hiranand bhai, any final closing comments? Sandibai, please. Thank you so much.
Sandeep Engineer
No, thank you everyone. And as we have answered all the questions related to all the queries and we are sure that we will meet in person after the fiscal year ending of four. And we are looking forward to that. And Astel has always come out and given its right pictures and all. And we also eagerly look forward to meeting you and we will strive to do our best. Thank you everyone for the support and the call.
Hiranand Savlani
Thank you. Thank you everyone for participating. If anything is left out in the question answer session you can directly reach on my mobile. Thank you so much.
Sandeep Engineer
Thank you Riteshi for organizing. Thank you everyone.
Hiranand Savlani
Thank you. Thank you all.
Operator
Ladies and gentlemen, on behalf of investech Capital Services India limited that concludes this conference. You may now disconnect.