Ganesha Ecosphere Limited (NSE: GANECOS) Q3 2026 Earnings Call dated Feb. 09, 2026
Corporate Participants:
Gopal Agarwal — Chief Finance Officer
Yash Sharma — Director
Analysts:
Manish Mahawar — Analyst
Achal Mehta — Analyst
Dheeraj Ram — Analyst
Mehul Panjwani — Analyst
Bharat Gulati — Analyst
Darshika Khemka — Analyst
Bhavik Shah — Analyst
Avnish Tiwari — Analyst
Dhirendra Kumar Patro — Analyst
Athar Syed — Analyst
Siddhartha Barman — Analyst
Reuben Mathews — Analyst
Sebastian Spady — Analyst
Presentation:
operator
Ladies and gentlemen, good day and welcome to Ganesha Ecosphere Limited Q3 and 9 months FY26 post results conference call hosted by Antech Stock Broking Limited as a reminder of 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 touchtone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Manish Mahavar from Antec Stock Broking Ltd. Thank you.
And over to you Mr. Maneesh.
Manish Mahawar — Analyst
Yes, thank you. Moderator Good morning everyone. I am pleased to host today’s earning call of Ganesha Ecosphere. Today we have a leadership team represented by Mr. Gopal Agrawal, CFO Mr. Prashant Khandelwal, Senior Vice President Mr. Dash Sharma, Director, Ganesha Ecopet without any delay, I would like to invite Mr. Yash Sharma to start with opening comment post which we will open the floor for Q A. Thank you. Over to Yash.
Yash Sharma — Director
Thanks. Thanks a lot Manish. Good afternoon everyone. For being here I welcome you all to our post results Earnings Con call to discuss the Q3 year 2026 performance this quarter has been marked by resilience and progress across our legacy operations despite sectoral headwinds such as the higher US tariffs on Indian textiles. I am pleased to share that our standalone business has delivered a good set of numbers with Production volumes growing 13% quarter on quarter and sales volumes up by 7%. Revenue from the OPER operations increasing sequentially and grew by 5.24% as compared to the last quarter while the EBITDA has stood at 18.54 crores and pad at 15.94 crores surpassing the combined earnings of the previous two quarters.
On standalone basis, the capacity utilization has exceeded 100% with production volume of 29,088 milli tonnes as against 25,689 tonnes in the previous quarter. Sales volume at 31,107 tonnes made during the quarter was the highest in the last five years. The company earned a revenue of 272.2 compared to 59.35 crores in the last quarter reflecting a growth of 5.24%. EBITDA per ton came in at 5962 as against 2812 during the last quarter. The EBITDA margins were at 6.79% of the operational revenue as against 3.15 of the last quarter. The raw material Prices have been pretty stable during the quarter in contrast to the high volatility we have experienced previously which further supported the margins.
We have continued to diversify our portfolio reduce reducing dependency on the traditional spinning sector with over 35% of the sales volume being generated from the non own and the home furnishing segments on a consolidated basis. The performance was impacted by the ongoing uncertainty certainty surrounding the draft notification issued by the MOEF which delayed the integration of recycled PET into supply chains of beverages and weakened the demand for arpid granules. Overall, the stereo business saw capacity utilization drop to 50% and revenues declined by 23%. Consolidated production has stood at 38768 megatons with revenue of 357.22 crores, marginally lower than the last quarter.
Of this, 272.95 crores came from the standalone and 84.27 from the subsidiaries. Quarterly EBITDA rose by 37.67% to 30.73 crores with standalone and subsidiary contributions of 18.54 and 12.19 respectively. Consolidated EBITDA margins have improved to 8.6% and the EBITDA per ton has climbed to 7630 from 5703 in Q2 consolidated PAT was 4.74 crores. EBITDA of the subsidiary business has stood at 14.5%. Although the much awaited clarity on the draft notification would have benefited both the user industry and the recycling sector, its extraordinary delay has defeated the purpose. Even if the final notification is issued now providing some relief in the 30% target for mandatory use of physical content, the packaging industry will not be able to meet such low targets within the remaining span of the current financial year.
FY26 is a transitional year for implementing the PWM rules on mandatory recycled content and the adoption was somehow challenging for the user industry and the regulator. We believe that the initial hindrances are being addressed and that adequate approved recycling capacities are now in place which will make adoption much smoother from the next year onwards. Since the regulation mandating recycled content remains unchanged, the user industry cannot continue to be non compliant anymore. Overall, we are confident of achieving the desired performance for this business from FY2, albeit with a delay of one year. Our legacy business has regained sustainable momentum and recently announced reduction of US Tariff for Indian textiles should provide an additional boost in the coming quarters.
The B2B RP business is also expected to perform comparatively better in Q4. In a recent development, our recycled filament yarn has Successfully qualified with the leading global textile brand improving the margins and volumes for filament yarn business. We are pleased to share that we have now become a regular supplier of our stadium sized flags for the International Cricket Council directly and where we are providing the stadium sized flags of various countries as UNITY as well as unity flags made with our recycled materials for the World cup tournaments. This collaboration highlights the global recognition of our sustainable products and prowess.
Overall. Q3 FY26 reflects both the strength of our core operations and the long term potential of our sustainability driven initiatives. We remain confident in our ability to navigate the near term challenges while building a stronger sustainable business for the future. Thank you everyone.
operator
Should I begin with the question and answer section?
Yash Sharma — Director
Yes please.
operator
All right, thank you very much. We will now begin with the question and answer session. Anyone who wishes to ask a question may press star and one on the 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 Achal Mehta from Bastion Research. Please go ahead.
Achal Mehta — Analyst
Hello sir. Thank you for the opportunity. I want to ask that in Food Grid Architect earlier there were 5 to 6 approved manufacturers from FSAI. However as of September 2025 many nuclears are entered taking the toll to 13. So has this increased competition for a significantly and how does the Ministry of Environment sees this? Do you feel there is enough manufacturing capacity in the industry now to fulfill FY27 in demand?
Yash Sharma — Director
Yeah, thanks. Thanks for your question. So yes, definitely the number of FSSA approved players has gone up quite significantly and there have been much much newer capacities. Yes, certainly because of that there is obviously increased competition in the industry. But the increased competition is because of the reason that the offtake of the industry has not really taken off as per the volume increase that has happened and the capacity and supply available going forward now there enough capacity available to meet the targets for the for the next year and I think that definitely the industry is going to mature much more in a better way now.
Achal Mehta — Analyst
Oh my second question is what is the export revenue for the quarter and for the nine months?
operator
Sorry to interrupt you sir. So your audio is not clear. Can you speak through the handset?
Achal Mehta — Analyst
Hello, Am I audible?
operator
So can you by the handset? The audio is still not clear.
Achal Mehta — Analyst
Hello, Am I audible now? Hello?
operator
Yes, it’s better.
Achal Mehta — Analyst
So my next question is what is the export revenue for the quarter and for the nine months.
Yash Sharma — Director
So. So on console level we made the export about 30 crore. And upon nine months we made the export more than 100 crore. Okay.
Achal Mehta — Analyst
So why we haven’t not been able to sell to Europe and US where we have approval of there and there is no tariff on our products. Considering on the ongoing delays they should have been able to offset the decline in domestic demand. Since demand.
Yash Sharma — Director
So actually the tariff is also applicable our products as well. So when the US tariff was implemented earlier in May, at that time PET polymer or you know, PET granules were in the exemption list. But on 2 September when the new modification of the tariffs and the exemption list came out, the PD was extruded out of the exemption list. So since second September we have been in the. We are also. The tariffs are also applicable on our product. So because of that we have not been able to work out any supplies to the US market because of the tariff conditions of 50% receivable tariffs.
Achal Mehta — Analyst
Okay. And what is the broad range on volume and margins on the R filament order?
Yash Sharma — Director
So. So it is. It is very, very low at present. But we have. We have been qualified with a global textile brand. And from the next quarter onwards the volume would increase significantly.
Achal Mehta — Analyst
Okay. And do you expect realization to uptick towards 1 lakh per per ton level for the legacy business now that there are reduced tariffs on our end customer industry?
Yash Sharma — Director
Yes, certainly the volumes are very good in this quarter also we have sold the 31,000 ton volume from our legacy business in this quarter. And definitely it will be well above the 1 lakh ton for the. For the entire year.
Achal Mehta — Analyst
Okay, thanks so much.
operator
Thank you. The next question is from the line of Dheeraj Ram from B and K securities. Please go ahead.
Dheeraj Ram — Analyst
Hi sir. Thank you for taking up my question. Two, three questions. So first one is on standalone business, margins have been improved sequentially. So is it due to raw material prices? If it is yes, then let me know the average raw material price of consumption during the quarter. And how do you see that in 4Q?
Yash Sharma — Director
Yeah. The raw metal price was quite stable during the quarter. The uncertainty which prevailed over last two quarters was not there. So it helped us in margins improvement in this one legacy business.
Dheeraj Ram — Analyst
Okay. Any price that you want to quote. Sir, right now, how is the price trend?
Achal Mehta — Analyst
So right now that the prices are in the range of the bottle prices are in the range of 46, 47 rupees a kg.
Dheeraj Ram — Analyst
Okay, got it. And the subsidiary business, I feel it was being impacted just because of the utilization. But how do you. How can we go about for 4Q and for FY27. How do you see the inflation levels for ARPIT especially in subsidiary.
Yash Sharma — Director
So for we are quite hopeful that the volumes will be better in Q4 than the Q3. We are expecting the overall capacity horizon in between 70 to 80% in Q4.
Dheeraj Ram — Analyst
Understood. And can we take the same for FY27 sir? Or do we take between 60 to 70%?
Yash Sharma — Director
No. So. So FY27 must be. Must be a good one. And. And on the expected lines which we have had thought of the. For FY26 but because of the. The chaos on the regulation side it could not happen in this year. So. So definitely it would happen in FY27 when the regulation would be for 40%. And there is much clarity now over the offtake. This is the. This is the regulation is. Is live and intact.
Dheeraj Ram — Analyst
Okay. Great. Got it. And last question sir. We had some outstanding to be received from the government authorities. Any progress on that or is it still to be received?
Yash Sharma — Director
Yeah. So. So we. We got the 70 crore from the government out of outstanding incentives. About 110 crore from the. From the. For. From the Telangana government for a Varangal plant. The amount we have received in January only.
Dheeraj Ram — Analyst
Got it. Great. Great. Last question Sir. How do you see this PWMR coming into effect in FY27? I understand that capacities are up, up and running now. And demand is meeting the capacity. And that’s how you’re guiding for FY27 PWMR. But how do you. Is there any chance to roll this forward to FY28?
Yash Sharma — Director
So basically for as far as the PWMR is concerned Plastic waste management. We have to understand the chronology of this notification. The notification came into force in 2022 mentioning that every brand owner or packaging, plastic packaging manufacturer has to use certain percentage of recycle content from 2526. So it was a 30% and then it has to increase by 10% every year till 29 up to 60% if any shortfall is there in using this recycle content there is a penalty provision. For first year it is 2900 per ton. The second year it is 5800 certain. And the third year it is 8700 per ton.
So because in in very initial stage there was not not much capacity available. There was stakeholders representation for this with the government. And the government has assured everyone that they will look into it and will provide some relief if any capacity is not available to complete 30% target for first year only in that case government may give some relief. And everybody was waiting for that relief the whole year. It is a relaxation. Because you see even we are discussing as on date the 30% recycle content consumption notification is there. Everybody has to use 30% recycled content.
If any notifications for the relaxations comes coming forward in next two months. Because it is now irrelevant. Because a whole year has passed into in less than two months. You cannot do much with your consumption or non consumption. But even if any relaxation comes in the remaining period, there will certainly be a big numbers of brands who are going to pay penalty for the first year itself. So everybody will be in that category of first year penalty of 2900 from April onwards. They have to pay 5800 if any shortfall comes in the next year. So it is intact, the notification is intact.
And the implementation as per our discussion with the government officers and the stakeholder from government side, this notification is intact. And a lot of investment has came into it in this particular recycling field. Not only in pet but also in polyolefins and other plastics. So there is not much delays or any major modification is going to be happening coming days.
Dheeraj Ram — Analyst
Got it? Agreed sir. Agree. This last question then I’ll come back in the queue. This new client that you’re talking about in filament yarn, when do you see the offtake going for this client and how do you see margins and realizations for this? And what is expected to be the offtake for this?
Yash Sharma — Director
So the offtake will be started from February itself. And we are expecting that almost 20 to 30% utilizations of our capacity of the filament yarn are going to be increased. You know, working for us, for our. For our partnership that we have done started with them. And the margins are quite good as expected on our lines for the filament project. Sorry, but we cannot disclose exactly the numbers for the particular product due to competitive reasons. But it’ll be good.
Dheeraj Ram — Analyst
Thank you.
operator
Thank you. The next question is from the line of mehul Panjani from 40 cents. Please go ahead.
Mehul Panjwani — Analyst
Hello sir. Thank you so much for the opportunity. Sir, now that your legacy business is done well in terms of volumes, can we. When can we comment on how soon it will take to be out of the woods in the non legacy business?
Yash Sharma — Director
So now we are expecting the. The. The offtake. The offtake will start in the current. In the current quarter itself. We are expecting a good demand and we are expecting the good demand from. From april onwards. So FY27 would be the. The year which we are expecting from the FY26 but definitely FY27 will be. The good year answer.
Mehul Panjwani — Analyst
The government regulation which we are expecting is it out or it is yet expect it not out.
Yash Sharma — Director
So regulation is already there. So the one notification draft notification was there for giving the some relief to the user industry but that draft notification has not been finalized yet. And and and as now the the current sensory is going is coming to party to approaching to end. So we don’t think it will come now.
Mehul Panjwani — Analyst
It won’t come.
Yash Sharma — Director
So this is the basis. This is the. This is the basis the capacity available in the arpit in the Indian market. The government may. The government may also not provide the relief at the relief by the user industry at the beginning of the financial year.
Mehul Panjwani — Analyst
So government may not. If government doesn’t is not expected to provide any relief then then our business will be significantly impacted, right?
Yash Sharma — Director
No no no. Notification has to come for the relaxation to the brand owner not to the recycler for recycler for brand owner it is 30% mandate and it is intact for the year. If any relaxation comes that okay. Instead of 30% we will allow you 10% of this EPR content responsibility target to be transferred to the next year. So brand owner has to get a relief. If relief doesn’t come then they have to use 30%.
Mehul Panjwani — Analyst
Okay so that is a benefit to us in that that means.
Yash Sharma — Director
Yes yes yes yes but but only.
Mehul Panjwani — Analyst
Thing that it will it will start flowing into a numbers from next from Q1 of effort 27.
Yash Sharma — Director
Yes yes.
Mehul Panjwani — Analyst
Okay sir thank you so much.
operator
Thank you. Participants may press star and one to ask a question. The next question is from the line of Bharat Gulati from Dalal and Doka. Please go ahead.
Bharat Gulati — Analyst
Yeah. Hi sir, thank you for the questions. I just had a question regarding a standalone business in terms of ebitda per ton that has seen a significant degrowth year on year and that’s been on a downward trend year on year but has picked up QoQ. So are we seeing this going forward to improve further on and you know what will be the kind will we be able to reach back to our FY25 levels or are we going to create a base which is lower than that and then sustain that? If you can help me understand what kind of EBITDA per tunnel we have going forward.
Thank you.
Yash Sharma — Director
So Bharatji actually this business was under distress since last 2, 3/4, 3/4 because of the reasons already explained in various concourse. So now this business has come to back on the track and so the margins have started to improve and we are expecting in FY37 we would be able to make the, the margins which we are earning earlier on our legacy business. It is in the range of around 9,000 ton to 10,000 ton per EBITDA per ton.
Bharat Gulati — Analyst
So it would be back to let’s say our FY24 levels which is of 10 rupees per per ton of EBITDA.
Yash Sharma — Director
Yes, yes. We we are expecting because of the, the demand. Because of the, the, the recent, the recent us. We are expecting it would come back on the track.
Bharat Gulati — Analyst
Got it. Okay. And just to understand our, our business, our RPD granules business in Varangal, if you can help me understand what kind of peak revenues can we get from that, you know in terms of once utilizations will pick up next year.
Yash Sharma — Director
Yeah. So. So next year we would be operating at about 70,000 ton capacity apartment in Varangal unit. So the peak revenue potential is about 700 to 800.
Bharat Gulati — Analyst
Okay. So and just to understand the EBITDA per ton there also has gotten hit. So do we see that also coming back to normalized levels or will that be on in permanent pressures creating a new base because of the higher raw material cost that we are facing now?
Yash Sharma — Director
You see the ETA margins has been impacted because of the lower capacity utilization and also the, the as the listing is not there in the market and so many units have been bought the licenses and so the supply side is more in comparison to demand. And so so the paper was there in the prices also margins also. But going forward we see when the demand will pick up from the sector in next year. So and basis the capacity and the supply. So it will be matching. And so the pressures which we are facing now must be relaxed to some level in next year.
Bharat Gulati — Analyst
So could you just help me with the number of what kind of EBITDA per turns would we be expecting to do next year?
Yash Sharma — Director
So for the EBITDA we cannot comment as of now currently because the so many developments are there in the market in the current year. So, so the market is evolving and so EBITDA margins. Exactly. Forecasting the EBITDA margins is not possible as of now. We will be able to comment in on next quarter itself.
Bharat Gulati — Analyst
Got it. And just one last question. So in terms of Q4 for our, for our, you know the business that focuses on the FNB segment, is that seen any pickup in terms of customers trying to fulfill whatever, whatever they can and reduce their penalties or is it still in the same trajectory as it, as it’s been.
operator
Yes, sorry, can you repeat the question again?
Bharat Gulati — Analyst
So just trying to understand has there been some uptick in demand in from the FNB players or is it, is it been constant with how the previous two quarters have played out?
Gopal Agarwal — Chief Finance Officer
No, so definitely compared to the last quarter there has been an uptick in the demand and consumption from the FNB players but it is still not to the level that we expected it should be. So yes, it has improved definitely. Yes, but still not very where it’s. I mean way lower than where it should be actually.
Yash Sharma — Director
Yeah. So. So basically as a basically basis the current situation we are expecting a capacity utilization of Warangal plant by about in between 70 to 80% as well as the 50% which we have got in this Q3 quarter.
Bharat Gulati — Analyst
Got it sir, got it. Okay, that was helpful sir, thank you. I’ll get back.
operator
Thank you. The next question is from the line of Darshika Khemka from AV Fincorp. Please go ahead.
Bharat Gulati — Analyst
Hello sir, thank you for the opportunity. I had a couple of questions firstly on the lines of the fact that 2/4 of our FY26 year have been impacted by the MOEF notification do you think that this is now behind us or there could be a probability of the government giving this sort of relaxation once again in FY27 considering the fact that you know the 30 implementation would be difficult in Q4 and this would sort of be carried forward in the next year.
Yash Sharma — Director
So unless the relaxation notification doesn’t come there is no carry forward. So this year 30 point consumption was mandatory and, and whatever the, whatever the shortfall is there the penalty would be levied penalty. So and for next year it is 40 and the relation notification was proposed basis the capacity of recycling capacity was not there in the beginning of the financial year 26 but now the approved capacity is almost 250000 to 300000 done in between and so it meets the requirement of the industry, user industry for the next year. So we don’t expect there would be any relaxation will come further for next year.
Darshika Khemka — Analyst
So considering this background would be right to change our guidance for FY27 that we had given the last year both for the legacy business and for the consolidated business and the legacy business particularly around the fact that the raw material prices have now normalized and you had extremely expected 10% margins for Q4FY26 and a slight improvement further towards 11% for FY27. Is that guidance intact or are we improving it further? And also for the RPED business, what is the guidance that we are now giving. Is there any change?
Yash Sharma — Director
No. So basically our legacy business, we are expecting a 9 to 10. We’ll come back to a 9 to 10% income margins next year. And for the Arpit business, yes, we are Expecting with the 40% mandatory use is intact. We will be doing a much better.
Darshika Khemka — Analyst
Okay. And we had expected 65% of our revenue coming from Arpat chips by FY28. That is also still intact, right?
Yash Sharma — Director
Yes. Once the, once the offtake starts, definitely we will, we will go, we will move on our capacity extensions.
Darshika Khemka — Analyst
Got it? All right, that’s it for me. Thank you so much.
operator
Thank you. The next question is from the line of Bhavik Shah from Invexa Capital. Please go ahead. Yes, I audible.
Bhavik Shah — Analyst
Yeah. So my first question is our realizations are actually not improved despite you mentioning the notification is still in place. So what is actually leading that the companies are not buying in the volumes they require to fulfill for the year. One second is then have you seen any traction in the last quarter currently like in terms of the improvement in realizations?
Gopal Agarwal — Chief Finance Officer
So you see why the basically if you look at same, you know, as Prashantha had put in detail the chronological order. What happened is that the regulation for 30% offtake is live. But in June the government came out with a draft giving some relaxation that okay, you know, you can carry because there is capacity shortfall, you know, to meet the target, you can carry forward to the next three years. Since then there has been a lot of to and fro happening between the industry bodies and the government. And they are finally working with the final notification.
Everyone is awaiting and postponing their purchases for the final notification to come out. Which is, you know, with the relaxation basically. And because of that everyone has been holding off to, you know, do their purchases since December. So if you look at the current situation, it is, you know, because the government has told that everyone that we will be coming out with it very soon. So everyone has definitely started again the offtakes. Yes, obviously it has not reached to the level that it is expected. But since the. Since the notification is still not out a lot of brands, I mean, I would say 90% of the people are still, you know, not have not really started the offtake in the right volume way manner.
And the realizations have also been very consistent. They have not improved because still the capacity or the supply of the material is way, way more than the demand demand. So the residents have not really improved any bit.
Bhavik Shah — Analyst
Understood. So basically they are ready to pay the penalty of 2900 per ton. But they’re not willing to purchase the additional volumes. Right.
Yash Sharma — Director
So you see it’s much more complex than that. You can say when it comes to bigger brands, paying penalties for them is a very, very big issue from their brand equity point of view. Second is that paying the penalty also does not absolve you of the requirement. It just carries forward the, you know, the volume require to the few forward years and like also there is another EC clause which is the Environmental Compensation act where they can levy a much more stringent penalty to on you, on you if you are not, you know, fulfilling the mandate.
So paying penalty is. It’s not as simple as it seems like. But the problem is that they are awaiting the final notification, the relaxation notification from the government because of which they have been, you know, postponing the usage.
Bhavik Shah — Analyst
Understood. And so when we say 9 to 10% margins we are guiding for. So can you just help us understand like do we expect our cost to be lower? Do we expect our realizations to improve to come to this margin or what are we factoring in to come to this margin?
Yash Sharma — Director
So 9 to 10% guidance is regarding our legacy business. So, so basically the raw material prices has been. The stability in the raw prices is a key factor. And, and with the increase in the volume and, and our shifting, shifting over, shifting over production, our dependence on the spinning sector, it will be driving the margins.
Bhavik Shah — Analyst
Understood. So just let us assume that this notification is there without any changes. So how do we see our volumes in FY27?
Yash Sharma — Director
So this relaxation notification only meant only for the FY26. It is nothing to do with the FY27. So the regulation of 40% for the FY27 intact.
Bhavik Shah — Analyst
So like then how do we see our volumes improving? Sir, in terms of so, so, so.
Yash Sharma — Director
So so for next year this is the. The regulation is intact for 40%. We are expecting we would be able to utilize 85 to 91 capacity utilization. And currently we are next year we will be having around 70,000 capacity and so we would be expecting a volume of around 55 to 60,000 ton and more than 50,000 tons.
Bhavik Shah — Analyst
Okay sir, thank you so much and all the best.
operator
Thank you. The next question is on the line of avnish from Vicario. Please go ahead.
Avnish Tiwari — Analyst
Hi, am I audible?
operator
Yes sir, you’re audible.
Avnish Tiwari — Analyst
In terms of these FNB customers, you have. The number of vendors they have approved earlier. Has there been any change in that? Because there’s a lot of capacity which. Is coming or have they signed up. Or approved more Vendors.
Gopal Agarwal — Chief Finance Officer
Yes, definitely. They are obviously working with more vendors also. And I mean, I mean the bigger problem here is that is not that they are proving other vendors is that the volume of take is not going up with the capacity increase that is coming in. That has been the biggest issue which has caused this kind of depreciation. I mean this kind of outlook in the arpit industry currently. And they will have to do that. They will have to work with all the recycling tests because the capacity needed, you know, to fulfill the mandate requirement is obviously currently still under.
It’s almost matching. They will obviously the industry will have to work with the people, you know, who are also putting up capacities.
Avnish Tiwari — Analyst
Right. The. Go on. I mean the bigger problem is that the number of players who are using the RPD currently has not gone up. We were expecting that, you know, as the mandate comes to final this thing that the number of players should now start to increase. They have. It’s increasing but not at the rate that it should actually.
Gopal Agarwal — Chief Finance Officer
Yeah. And as far as the approval is concerned. Yeah, we have. Our product is approved from almost all.
Avnish Tiwari — Analyst
The big plants right now. I meant to say your customers, let’s. Say earlier working with the two recyclers now they now have approved three, four or five recyclers because more capacity have come in.
Gopal Agarwal — Chief Finance Officer
They have. Correct? Correct. Absolutely they have. Yes.
Avnish Tiwari — Analyst
Got it. And let’s say as you mentioned, some. Of these global brands, if they have. To be really, really careful about breaching the norms, will they have it like. Even if the notification comes in February and or March, they don’t have much time. If they have to fulfill this 30% irrespective whether electrician comes or not. They need to decide whether they whether to pay penalty or off take. Right. Or they can offtake. Let’s suggest in the month of March, can they offtake enough quantity to meet this guideline?
Gopal Agarwal — Chief Finance Officer
No, definitely. You see it’s. Please go on, sir.
Yash Sharma — Director
So I think you see the 30 mandate is there if any relaxation, let’s say, let’s presume whatever was in the year a 10 relaxation comes for the current year. Even if 10 relaxation comes, you are very correct that most of the brand are going to pay penalty for the first year. And the first year penalty of 2900 is only for the first default. Once a first default has been done, the next default has. On case of next default you have to pay penalty of 5800 and in case of third default there will be a penalty of 8700.
Over and above this there will be environment compensation so if any relaxation comes for the first year, because government has been represented by all the brand owners, many of the brand owners that not enough capacity is available for the first year. So they. They were seeking some relaxation in the percentage for the first year. So for next year there is a mandate of 40% which has to be fulfilled by the brand owner. And there will be looking to this 40 number. There will be good demand. And Ganesha as the largest capacity holder is well placed for taking that demand in the business.
Avnish Tiwari — Analyst
I was trying to understand that if. There’S a 10% and they have to fulfill this 20%, somebody who does not. Want to be in this mod of. Not being compliant, will they have this one month so much material that they can use this 20% not just with. Ganesha, but across the industry that availability is so high that they can fulfill. This in one month or so. Otherwise they will be in like they can pay penalty and all but still be having the challenge of not meeting the number.
Yash Sharma — Director
Yeah. So for in any case, if any relaxation comes altogether so. So it is, it is, it is sure that UNHD will not be able to fulfill it. Even the lower targets, they will not be able to fulfill it.
Avnish Tiwari — Analyst
Okay, the second question I had was, you know, export side. Now if the tariffs are reduced to this 18, so your product will be covered with the 18%. Would you looking at exporting opportunity or you think that 18% is also too high to make this export viable for you?
Gopal Agarwal — Chief Finance Officer
So you see the market is currently very evolving across and definitely we are currently in discussions with consumers there. And we will get to know about this only with time of what kind of volume and business is possible.
Avnish Tiwari — Analyst
Okay, great. Thank you.
operator
Thank you. The next question is from the line of Dhirendra Kumar Patro from Spark pms. Please go ahead.
Dhirendra Kumar Patro — Analyst
Hi sir. Thank you for the opportunity. My first question is that based on Capex, can you provide any color on our Capex plan? Brownfield and greenfield in FY26, 27 and 28 in terms of investments and metric terms.
Gopal Agarwal — Chief Finance Officer
So. So we are already implementing a brownfield project. The brownfield project would be operational by March and April. And so it’s around 130 crore which has been largely incurred so far. And for the next leg of expansion, greenfield expansion or the brownfield expansion, we are as per our plans, the 4, 400, around 450 crore is to be invested in next next two years.
Dhirendra Kumar Patro — Analyst
Okay, so 130 crores of brownfield, that was around 22,500 tons of ARPIT in foreign.
Gopal Agarwal — Chief Finance Officer
Correct. Correct.
Dhirendra Kumar Patro — Analyst
And so if I heard it right, you said 4Q would be able to do 70 utilization in the subsidiary business that 70% is including the brownfield expansion.
Gopal Agarwal — Chief Finance Officer
Correct? Correct.
Dhirendra Kumar Patro — Analyst
Those are my question. Thank you.
operator
Thank you. The next question is on the line of Athar Said from Smart Sync Services. Please go ahead.
Athar Syed — Analyst
Hello sir. Thank you for the opportunity. This is my first time ever. I’m attending your call. Sorry if I have some basic questions but I wanted to understand do we have any seasonality in our business? So can you please explain the signality in our business?
Gopal Agarwal — Chief Finance Officer
So seasonally in case of a legacy business the seasonality is largely from the raw material side so in case of northern India in winter season the raw material availability reduces somewhat and in the summer season the availability is superior but from the our finished goods level there is no. No such seasonality in our legacy business. And for our you due to with Renovas business. Yes, there is a certain thing though it is a very new business so it will. It. It will be. It will be much much comprehended in next financial year but certainly the user industry is having the opportunity when there is a winter season and from August to September onwards they reduces their production and the production is again geared up from the January itself.
Athar Syed — Analyst
Basically the main seasonality which we have in our legacy business because of raw materials, right? Raw material prices.
Gopal Agarwal — Chief Finance Officer
Correct.
Athar Syed — Analyst
So what are the majors we are taking to mitigate these risks? Mainly raw material price.
Gopal Agarwal — Chief Finance Officer
So so basically. Basically we try to. We try to. To make. To make some inventory. Basically you see the raw material, our raw material is scrapped. So it is not an organized business. It is not a standard material. So the collection is going on and you have to buy it. So you cannot. You cannot stock it in too big quantity. But certainly we try to maintain an inventory of around 30, 35 days and in summer season we will try to increase the inventory by every 4, 5 days additional inventory is talking.
Athar Syed — Analyst
As you are talking about this draft notification so can you please explain more on this? Like you are expecting like the players expecting 10%. Relax relaxations also so can you please throw some light on that job?
Gopal Agarwal — Chief Finance Officer
Can you please come again? Your wife was not. Yeah yeah. Audible
Athar Syed — Analyst
hello. Now I’m audible
Gopal Agarwal — Chief Finance Officer
better. It is better.
Athar Syed — Analyst
Yeah so just wanted to know more about the draft notification which you are talking if I joined late.
Gopal Agarwal — Chief Finance Officer
Yeah, so. So the draft basically the regulation was implemented for 30% mandatory content of recycle recycled granules in the packaging industry. Plastic packaging industry and the regulation was implemented from April 26, 25, April 25. But when the regulation was implemented, the enough capacity recycling capacity was not available. And only around 70,75,000 approved capacity was there. While the convention was expected to be much more than that. And so the. So the user industry contacted contact to do the ministry MOE of CG for some relaxation. So in June the government. The government has come out with a draft motivation in which they propose to allow the to make the next 7 and 30 target and allowing the shortfall for our next three years.
That was a draft motivation which is not finalized yet.
operator
Sir, may I request you to join the queue for a follow up question. The next question is from the line of mehul Panjwani from 40 cents. Please go ahead.
Mehul Panjwani — Analyst
Hello. Thank you sir. Thank you for the follow up. So sir, regarding the preceding question. You said that the notification was draft notification was. Was for three years. So it has not come yet.
Gopal Agarwal — Chief Finance Officer
Right. It is not for the three year. It is not only for the FY26 but any shortfall was to be carried forward for next year. If suppose the 30 target is there and someone uses the 20. So 10. 10 is a shortfall. So 10 shortfall could be. Could be recruiting or next year.
Mehul Panjwani — Analyst
Okay. Okay, got it. And sir, my next question is. Sir, can we expect that Q4 results will be better than Q2 and Q3?
Gopal Agarwal — Chief Finance Officer
Yes, yes, we are expecting the better. A better Q4 than the 2, 3 and.
Athar Syed — Analyst
And it will be mainly aided by the legacy business or overall.
Gopal Agarwal — Chief Finance Officer
Overall both legacy business as well as for new business, our subsidiary business.
Athar Syed — Analyst
Okay, sir, thank you so much for answering all the questions. Thank you.
operator
Thank you. The next question is on the line of Siddhartha Burman from Sagun Capital. Please go ahead.
Siddhartha Barman — Analyst
Hello sir. Very good afternoon. Am I audible?
Gopal Agarwal — Chief Finance Officer
Yeah, yeah, you are. You are.
Siddhartha Barman — Analyst
Yes, sir. I was just trying to understand what would be the kind of margin we would be looking next year and forward. Any. Any kind of ballpark figure if you can tell us.
Gopal Agarwal — Chief Finance Officer
So we are not providing any guidance as of now because of the. The uncertainty prevailed in this financial year over the notification and the regulation. But certain. But we are expecting that this uncertainty would not be there for FY27. Certainly the margins would improve with the increased optics and volumes. But any margin guidance overall we would be able to provide only in the next quarter.
Siddhartha Barman — Analyst
Okay. Okay. So it will be same as the ttm. Or we can expect at least a slight.
Gopal Agarwal — Chief Finance Officer
We are expecting much better than that.
Siddhartha Barman — Analyst
Okay. Okay, fine. Thank you. That’s all my friends.
operator
Thank you. The next question is on the line of Ruben Matthews from Equity Intelligence. Please go Ahead.
Reuben Mathews — Analyst
Hi, I just wanted to know with your discussions with these big large branded players on how much are they right now, what is their percentage of recycled materials that they are using for the B2B?
Gopal Agarwal — Chief Finance Officer
So see it’s very difficult to give the exact numbers because even we don’t have the exact numbers. But it’s fairly low. I would say that it’s low then lower than 10 to 15% maybe somewhere in the ballpark. I’m just talking about the global big brands, but very difficult to come with exact number.
Reuben Mathews — Analyst
Okay, so you’re seeing that they are right now at around 10 to 15%. And with your recent discussions, do you see them ramping up to at least 20, 25% with the purchases that they are making or.
Gopal Agarwal — Chief Finance Officer
So CC currently? They are not ramping up, but definitely they would be both. The government notification plan, notification will be there.
Reuben Mathews — Analyst
Okay, okay. And this expansion plans, you don’t need to, you already have funds for the expansion, right? There’s no more additional funds required.
Yash Sharma — Director
Yes, we are having the, we are having the funds. Our levers position is also very, very comfortable. So we, so we manage from that.
Reuben Mathews — Analyst
Okay. And just to help me out with the average realization of your product, now is it around 100 rupees for the recycled plastic for the bottles? Because.
Yash Sharma — Director
Yeah. So it is different for the different products over the, for the fiber it is, it is lower than the, it is around 85 rupees. 84. 85 rupees. And for the granules. Yeah, yeah, of course it is more than 95 rupees.
Reuben Mathews — Analyst
More than 95. Okay, okay. And, and, and just one last question. Now I’m just starting to follow this company. So now you’re looking at collection of raw materials, right. For the plastic bottles now with all these is setting up their capacities, do you see there being a shortfall in collection of these raw materials or would you look at importing plastics maybe? How would you go about it?
Yash Sharma — Director
So you see that the collection is very, very good in the country as far as the pet bottles are concerned. And the user industry is from the fiber from B2B business. And so certainly the, the, the demand is, the demand is much better than much, much more than the, the supply side. So the, the fiber industries is trying to use some textile waste and other waste as against the pet bottle scrap. And so the industry is now moving from the pet bottle scrap to some other alternative. And so, so it will release the pressure on the supply side for the pet bottle.
Reuben Mathews — Analyst
Okay, okay. Okay.
operator
Thank you. The next question is on the line of Sebastian Study from Manish Mundada and Associates. Please go ahead.
Sebastian Spady — Analyst
Hello sir. Is my voice clearly audible?
operator
Yes sir.
Sebastian Spady — Analyst
Thank you. So my first question is regarding the competitive landscape as I have heard from a media release that Reliance Industries is also collaborating with Sri Chakra Ecotex to enter into the recycling pet business. So they are targeting to recycle around 5 billion plus PET bottles. And in an industry where Reliance is going to enter, we can expect a stiff competition there. So what is your opinion and perspective on it? I want to know that and add on to it that Reliance is also having chemical recycling technology as per my knowledge we Ganesha Ecosphere is currently using the mechanical recycling technology.
So I also want to take some. What is your take on it? Actually I want to know.
Gopal Agarwal — Chief Finance Officer
So. Yeah, hi. Sure. So yes, you’re right. So this, this. I think this news is not new. I think it’s pretty old news. So basically yes, the, the Reliance are collaborating but the collaboration is regarding the rpsf. The, the traditional, the legacy business that we have. Recycled pollution stable fiber business. That’s the collaboration recycling of the pet bottle waste. Basically. Reliance also has a capacity of its own to do RPSF and partner with Shichakra for building some more capacity of the rpsf, you know, product, which is our legacy product. And talking about competition, I mean I think it’s pretty clear that recycled pet industry has always been very very competitive.
I would highly competitive from the last 25 years and it remains to be so. And Ganesha has still been able to navigate and has maintained its position as the leader of the industry in spite of the industry condition.
Sebastian Spady — Analyst
And what about sir, are we planning to set up any chemical recycling plant or we are just planning to concentrate our recycling facilities.
Yash Sharma — Director
So, so we are basically into the mechanical recycling and we are the. And as far as the only the mechanical recycling is the proven one word over. Chemical recycling is at very nascent stage. And, and, and it is. Its costing is too too high. Operational cost is too high as well as the capacity is also too high. So, so, so it will, it will take a time to be commercially viable. Okay.
Sebastian Spady — Analyst
And sir, are we having any plan to recycle HDPE and flexible plastic and other hard plastics in future or are you just going to focus on PET recycling?
Gopal Agarwal — Chief Finance Officer
Yes, yes, we are also. We are also starting the recycling of the polyolefins apart from the pet. We are exploring that and as any concrete plan is not yet as of now finally but definitely we are looking for it.
Sebastian Spady — Analyst
Okay. And trying to do Some exports.
Gopal Agarwal — Chief Finance Officer
Yes. So we are already already making some export. Around 9 to 10% of our fiber volume has been exported. And because of the tariff in the US so. So we have started the export of some of our Arpit. But because of the Perry which was stopped now we are expecting it will again get some momentum.
operator
Sorry to interrupt you sir. You may join the queue for the next follow up question. The next question is from the line of Dheeraj Ram from BNK Securities. Please go ahead.
Dheeraj Ram — Analyst
Thank you for taking up my question again sir. For this Arctic realizations, historically, I mean in FY24 and 25 around used to be higher and now it slightly came down in FY27. Do you expect it to go back to previous levels or is it too much to go back to previous levels?
Gopal Agarwal — Chief Finance Officer
So basically the realizations of Arpit depends on the prices of the bottles, scrap bottles also. So, so, so it moves. Moves mostly with the prices of Arpegg bottle square bottles.
Dheeraj Ram — Analyst
Okay, okay, got it. And based on landscape of competition, what previous particip. Could you throw some light on this Indorama JV with warm beverages? If we consider that maybe coming in FY27 or 28, do we still have a shortfall of demand versus capacity of recycling?
Yash Sharma — Director
Yes, yes, definitely. Definitely. So see, it’s not about shortfall of demand versus capacity. It’s about managing the demand and supply. So what is happening now in the industry is that we are working together to establish a very coherent demand supply situation for the industry to work in a better way, in a more efficient way. So what is happening, what is not going to happen is that the like in the last couple of quarters, any new capacity, no new capacities have, are coming up or are coming up to be announced in the future. Because the industry is waiting for the demand to firm up and the numbers to stabilize.
So even with the JV volumes which are coming in, we’ve already considered it. In the current set of numbers, it’ll be still we will be almost at par with the demand and supply equation.
Dheeraj Ram — Analyst
Got it sir. Got it. Sure. Thank you.
operator
Thank you ladies and gentlemen. We take that as the last question of the day. And now I would like to hand the conference over to management for the closing comments.
Yash Sharma — Director
Thank you. Thank you all for joining today and for your continued press in our journey. We appreciate your continued engagement and look forward to updating you on our progress in the next call. Until then, stay safe and stay connected. Thank you.
operator
On behalf of Antec Stock Broking Ltd. That concludes this conference. Thank you for joining us and you may now disconnect your lines.