GHCL Ltd (NSE: GHCL) Q4 2025 Earnings Call dated May. 08, 2025
Corporate Participants:
Unidentified Speaker
R S Jalan — Managing Director
Raman Chopra — Chief Financial Officer and Executive Director of Finance
Analysts:
Unidentified Participant
Meet Vora — Analyst
Aditya Khetan — Analyst
Madhav Marda — Analyst
S. Ramesh — Analyst
Nasir Hussain — Analyst
Akshay Kothari — Analyst
Saket Kapoor — Analyst
Presentation:
operator
Ladies and gentlemen, good day and welcome to the GHCL’s Q4FY25 earnings conference call hosted by MK Global Financial Services 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 touch tone phone. Please note that this conference has been recorded. I now hand the conference over to Mr. Meet Vora from MK Global Financial Services Ltd. Thank you and over to you sir.
Meet Vora — Analyst
Thank you. Good evening everyone. Thank you for joining us on GHCL’s Q4FY25 results conference call. I would like to welcome the management and thank them for giving us this opportunity to host them. We have with us today Mr. R S Jalan, Managing Director, Mr. Raman Chopra, CFO and Executive Director of Finance Mr. Manu Jain, General Manager, Investor Relations and Finance. Before we begin this call, I would like to point out that some statements made in this call may be forward looking and a disclaimer to this effect has been included in the earnings presentation shared with you earlier.
I shall now hand over the call to the management for their opening remarks. Thank you. And over to you Sir.
R S Jalan — Managing Director
Thank you MIT. Thank you very much. Welcome to GSTL’s earning conference call for the fourth quarter and year ended 31st March 2025. Our results and investors presentation has been uploaded on the stock exchanges. Joining me today are Raman, Ed, CFO and Manu from Investors Relations. We witnessed a strong operational performance amidst a challenging and evolving external landscape at gstl. Our philosophy continues to be anchored on driving excellence across the value chain right from procurement and production to marketing and distribution. Our production volume during the quarter were largely in line with the previous quarter supported by slightly better sales volume.
Our continued focus on efficiency and cost optimization yielded meaningful savings during FY25 enabling us to deliver better margin over FY24 despite pricing pressure caused by increased import, these efforts have translated into a resilient financial outcome. Let me now offer a brief overview of the market environment on the global front. Western economy continues to grapple with weak demand for sodas primarily due to subdued consumer spending and muted business confidence. In contrast, China witnessed robust demand growth of 10% in FY23 I would say calendar year 23 and 18% during calendar year 2024. This strong momentum however, has now began to moderate.
The global macro setup has been marked by rising uncertainty and volatility influenced by recent imposition of tariff by The United States. These events have had broader implications on global trade dynamics, economic activities and market sentiments. In contrast, Indian soda market remained relatively strong and registered around 5% growth during FY25 over the previous years. However, owing to the subdued demand in western economy, India witnessed higher influx of lower price imports leading to softer price realization compared to the previous quarters. While the near term outlook remains sensitive to global development, we believe that structural tailwind are in place to support domestic demand over the medium to long term.
Specifically, the imposition of duty of on imported solar glass will promote local manufacturing along with government increasing focus on renewable energy. These sectors are likely to fuel incremental demand for solar ash in India. Amidst this dynamic backdrop, GSTL remains focused on its core strength to ensure optimum outcomes. We are confident that our strong fundamentals and disciplined execution plays us in a solid position to benefit a microeconomic conditions improve with respect to our growth plan. Execution remains on track. Our greenfield sodas project and the new salt field project in Gujarat represents long term strategic investments and that will deliver significant operational and financial gain over the next three years.
Commissioning of our vacuum salt and bromine projects remain scheduled for FY26. We expect these projects to begin contributing to our growth from FY26 while enhancing our product portfolio and competitive positioning. These initiatives have been thoughtfully designed to reinforce GSL performance across market cycles and to establish a long term growth territory. We are very bullish on what we are doing. We are very bullish on what we are doing. We are setting up projects which will give us benefits in medium to long term. We have achieved significant operational efficiencies in FY25. While challenging time is transitionally these efficiency will be permanent.
We remain committed to creating suitable value for all our stakeholders to strategic foresight and consistent execution. Thank you for your continued trust and support in gscl. And now I hand over the call to Raman for to walk through the financial highlights.
Raman Chopra — Chief Financial Officer and Executive Director of Finance
Thank you sir. Good evening everyone and a warm welcome to our earning call. For the fourth quarter and year ended 31 March 2025. We reported strong results on the back of operating excellence, innovation and cost control measures. This has resulted in better margins and higher profitability. GSCL has very consistently delivered on performance parameters. As I share financial highlights with you, I wish you to bring in certain insights into how we maintain this momentum. Revenue for the quarter came in at 807 crores as compared to 840 crores in the corresponding quarter of the last year and at 807 crore compared to Q3 of this year the operating revenue was impacted by global scenario and cheaper imports into India putting pressure on our realizations.
As we progress into FY26 we’ll see contribution coming from our vacuum, salt and bromine initiatives which truly is testament to how we have leveraged low incremental capex to create a positive value addition. Delta EBITDA for the quarter stood at 244 crore compared to 201 crore in Q4 of last year and rupees 259 crore in Q3 of this year EBITDA margin came in at strong 30.2% compared to 23.8% in Q4. FY24 for the full year EBITDA came in at 966 crores which is an increase of 7%. Year on year our margins remained resilient due to higher production, operational efficiencies and innovation resulting in reduction in input costs.
I’ll highlight here that it is by design that we are able to focus on profitability through adverse and normal cycles alike. Due to prudent approach to business and operations management pad for the quarter increased to 152 crore from 125 crore in the corresponding quarter of last year and 168 crore in Q3 of this year. For full year our PAT came in at 626 crores which is an increase of 9% over last year. Also for the full year we generated 725 crore in cash profit after tax. Out of this we spent 311 crore on growth capex, 114 crore on dividends to shareholders and 101 crores on repayment of loans.
While the working capital increase and others were a nominal 17 crore resulting in a net cash generation of 182 crores. We have a strong balance sheet with cash and investment of rupees 1080 crores as at the year end. This is a strength that we have always maintained and forms the basis behind our execution on capex and operational excellence. The business runs on a lean working capital cycle and together with proactive management of liquidity we are able to stay financially agile. The business has an attractive headroom for growth and I believe with our announced and planned initiative that we are on the right path.
With this I conclude my comments and would now request the moderator to open the forum for questions and answers. Thank you.
Questions and Answers:
operator
Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press Star and one on their Touchstone telephone. If you wish to 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 Aditya Ketan from SMIFS Institutional Equities. Please proceed.
Aditya Khetan
Yeah, thank you sir for the opportunity. Sir, my first question is. So when we look like this quarter, margins have been relatively better when we look on YUI basis.
operator
Hello. Sorry to interrupt, sir. It seems like the management’s line has got disconnected.
R S Jalan
No, no, no, we are listening. No, no, we are listening.
operator
Okay.
R S Jalan
Yeah.
Aditya Khetan
Yes, sir, my question was. Sir, we had seen that the margins have been relatively better when we look on Y basis. And this is largely because of the lower raw material cost. Any idea? Sir, you can give in terms of cycle today, where we are in terms of this ODA ash and how demand outlook going ahead and also with new capacities in Inner Mongolia soda ash coming in, has that capacity been well absorbed by the market?
R S Jalan
Yeah. Three questions in what you have just asked. One is that margin is better and how do we look at that going forward? Like in my opening remarks and my CFO’s opening remarks, we have said that our major strength is on the operational excellence. In spite of a very challenging year last year, we have been able to deliver the better result primarily because of the operational excellence. And that will be a kind of a situation will continue and the journey will continue. In terms of the outlook for the market, I have already said my opening remark.
Things are uncertain at this point of time. You know that the geopolitical situations are uncertain at this point of time. China demand is also slowing down and the overall at this point of time, in a shorter period of time, it is very difficult to say how the situation will pan out to be. Your third question was Inner Mongolia. Inner Mongolia has been absorbed in the 2425 itself. The volume has been there in the last year and that has been absorbed because of the 18% demand growth in China which happened in 2425 in calendar year 24.
Aditya Khetan
Got it. And sir, in terms of cycle like I believe because of the decline in prices of soda ash, I believe the cycle has been tilted downwards. Any ideas are like when we look in in the last 10 years, when we are so where we are standing in terms of the cycle.
R S Jalan
If you look at last 10, 15 years of the data, I can only tell you how the situation has been happened in the last 14, 15 years in that what we have seen is that soda as prices on a overall Basis has gone up around 7 to 9%. Broadly. Right, 7 to 9% on CAGR basis. Okay. And EBITDA per ton has also gone up in terms of the situation which is currently where are we at this point of the cycle? Very difficult because of geopolitical situations. And therefore I would not like to comment on that how, whether on the what stage of the cycle we are.
But if you look at the two things, I just want to highlight again and again, see what is our strength. See, market dynamics will keep on changing. Sometimes good, sometimes situation will be different. However, our excellence or the demonstration which we have done as a management is operational excellence. And in spite of such a challenging period of last year 24:25 we have been able to give a better result than the 23, 24. We will continue.
Aditya Khetan
Got it. Onto the bromine and salt. How is the work going on since we have acquired that land? Are we able to get the. Are we able to get the desired quality of salt and bromine? Like what was required and how are we planning to tap the customers in this space?
R S Jalan
See, in terms of bromine we are doing this bromine. Current bromine which is likely to be commissioned in FY26 is on the existing salt field and that project is going as per the schedule. Likely production means commercial production will start in third quarter. Vacuum salt also likely to be in the third quarter. And that is also happening on the current plant. What we have. So these are the two investments which are under implementation and that will get the benefit will start coming in FY26.
Aditya Khetan
Just one follow up on this. Recently in 2025 some new salt players have also entered the market. How you see the competitive intensity going? So we have also done. We have also outlined a 350 crore capex into the Zara Zumara plant. How you see competitive intensity once our plant production also starts to kick in, how things will behave.
R S Jalan
See Adit this Jara Jumara which you mentioned, this is a new greenfield new area which has been allotted to us called a normal salt which will be used for our own internal consumption on the new plant which we are setting up, including some of the volume will be coming to the current location also. And this will definitely have an advantage over the what we are buying from the market. And because this will be our own source.
Aditya Khetan
Okay, so that would be captively used. Okay, got it sir. Thank you.
R S Jalan
Thank you.
operator
Thank you. The next question is from the line of Madhav Marda from fii. Please proceed.
Madhav Marda
Yeah, hi. Thank you so much for your time. Just Wanted to understand on couple of areas. One was could you give us some sense on how much new capacity of Florida expected to come in the next two years in different markets including China, US, Turkey, etc. If you could give us some sense there. That’s my first question.
R S Jalan
See a couple of things. The mother which is happening because of this geopolitical situation and because of the demand being all those projects are getting now reworked and are getting delayed. Even yesterday only we got the feedback that in China some of the plants which were supposed to commission in next year has been kind of a postponed. One of the plant which was the Poland plant which is also announced to be closed. All this change because of economic situations, some of the change is happening and enough capacity has been built in 23 and 24. But still I think if you look at globally in spite of such a low demand, still you require roughly around 2 million tonnes of extra volume.
Even if you take 2, 2.5% of the global growth, you require 2 million transfer. So that’s extra every year. Okay.
Madhav Marda
Okay. So currently you’re saying even if there was a project which is very advanced in the construction, there’s no new expected commissioning in the next 12 months globally.
R S Jalan
Sorry Madhav, can you repeat your question?
Madhav Marda
No, I’m saying if there was any project which was in very advanced stages, there is no new capacity expected to come online in the next 12 months.
R S Jalan
I’m sorry Madhu, I’ve not been able to hear you properly.
Madhav Marda
No, I’m asking, you know some projects might have been very advanced in their construction. Do you expect any new plant to be commissioned in the next 12 months globally? Any sodash new plants which will come in the next 12 months?
R S Jalan
Yeah, 2, 3 million tons of the plant, 2 million definitely will be coming. If you look at across the globe China will be roughly around 1.1 million tonnes and other China rest of the world will be around 0.9. So roughly around 2 million tonnes.
Madhav Marda
2 million tonnes. Okay, got it. And then also wanted to check on your outlook for Surash pricing in the coming year. Any sense in terms of how the pricing could trend given there has been some demand softness and I think some bit of extra exports of sodash from markets such as US into Asia. So do you expect some softening of soda as prices in the next few quarters?
R S Jalan
Madhav, like I said it is very difficult at this point of time to kind of predict what will happen. But yes, like I said, China is softer globally. Europe is also softer. Even US demands are also not picking up. So the prices will be softer.
Madhav Marda
Okay, got it. And the last question was on the. There was a minimum export price which was in place in India. I think that is up for revision next month if I’m not wrong. So any views on that? Do you expect that to be re implemented or you know, how could that policy continue?
R S Jalan
See madam, we definitely the industry will apply for the extension that and we will definitely try that that case extended. But in a real sense the major benefit out of that minimum support price, I don’t know whether any major benefit has been accrued because of that. Industry is also trying for the add anti dumping duty. The application has been filed, the matter is under investigation. So the industry’s focus will be definitely to get some government support on that.
Madhav Marda
Thank you.
R S Jalan
Thank you.
operator
Thank you. The next question is from the line of S. Ramesh from Nirmal Bank Equities. Please proceed.
S. Ramesh
Hello, good evening and thank you very much and congratulations on your results in such a tough environment. So when you mentioned that China had absorbed the entire capacity in Inner Mongolia, are you basing that on the full utilization of the 5 million tons just been started in Mongolia or was it operating at just 25, 30% which is what we had heard last time. So what is the capacity that has been absorbed in terms of the installed capacity there?
R S Jalan
Sure, Ramesh, definitely. As per our understanding, they were almost fully utilized during the last year. And like I said, last year they had a huge demand from the solar and lithium carbonate and 18% demand growth on such a big number. And because of that they have been able to absorb the entire quantity. However, this year 25, the demands are little softer and maybe slightly negative. Could also happen because of the geopolitical situation. So that could lead to some kind of a, some kind of a surplus in China.
S. Ramesh
Okay, so in terms of your fourth quarter performance, it looks like you have get you’ve been able to improve your gross margins. So is there any carryover of low cost inventory or have you been able to get some, you know, improvement in your higher value products? How do you explain this improvement in gross margin?
R S Jalan
I have already said Ramesh, in my opening remarks that operational excellence there are a lot of innovations, lot of what you call optimization of our resources, efficiency of the plant. These are the things which was the highlight of 24, 25. And because of that we have been able to generate in spite of such a challenging pricing pressure, we have been able to deliver the better price. It is not because of the low price raw material. It is primarily because the efficiency in our System.
S. Ramesh
Okay, so in terms of your plan to expand your solar capacity, given the current excess capacity and the pricing pressure, you don’t have any second thoughts in terms of the timeline. You may still go ahead, but is there any, you know, thoughts in terms of possibly staggering that in terms of execution or would you stick to the current timeline and allocate capital for it?
R S Jalan
Like I said, we are very bullish on what we are doing. We are really bullish on what we are doing and the way we are doing. Okay, our ability to have the best capital investment or the lowest capital investment portion of sodas, our operational excellence. And these are the things which are permanent in nature. The market dynamics will be slightly up and down and this will be transitionary. And therefore our understanding is these projects are all long term projects. We are talking about 100 years of these projects get set up. The life cycle of this project is 100 years.
I think in terms of the overall plan for the company, we would like to be proud of what we are doing in terms of operational excellence or the way we are expending the capital. On the second side, we are also allocating the capital on the area, like I said, bromine vacuum salts, those allocations are also being done to kind of optimize on that area also. So we will continue to kind of focus on our investments.
S. Ramesh
Okay. On the Indian demand, if you look at the induced segments, automobiles are facing a slowdown. So do you see that reducing the pace of growth in soda this year? How do you read the different segments of growth in India for soda ash?
R S Jalan
Ramesh? I am looking at other way around. If you look at the solar glass, we are seeing the solar glass, there is a huge demand which is is likely to happen in 25, 26 and major benefit will be coming in 26, 27. Okay. Lot of new, you know that in the solar government has given the ad advantage, that duty of 10% has been reimposed and lot of new investments are getting border seal investing, Visakha is investing, Reliance is investing. And there is a likely significant demand is coming. And frankly speaking this even if you look at like your normal glass, normal glass are also doing good in India.
Even detergent is also there in 3 to 4% of the growth in detergent because of the rural population’s growth or the organization which is happening. So my sense is which at 15, 20 years, if you look at the growth of 5% was a very normal growth. So we are looking at growth more than this 5% going forward.
S. Ramesh
Okay, sir, thank you very much. And Wish you all the best.
R S Jalan
Thank you.
operator
Thank you. The next question is from the line of Nasir Hussain from Fintech Research Advisors Private Limited. Please proceed.
Nasir Hussain
Thank you for taking my question. I just wanted to know what are the volumes that we have sold for FY25.
R S Jalan
See Nasib, in terms of the volume, I have already said in my opening remarks that the volume was in line with what was the last quarter. And if you look at compared to the last year also our numbers was in line with the slightly better than the last year.
Nasir Hussain
Like. Could you just give a number figure, sir? If possible
R S Jalan
number. Be specific. We don’t talk. I can only give you the sense of what the number growth in the FY 24 versus 25. Our growth in the volume is around 9%.
Nasir Hussain
9%. Yeah. That will help. And in terms of capacity utilization, we should be above 95%. Is that right?
R S Jalan
Yes.
Nasir Hussain
On an annual basis.
R S Jalan
Yes. Yes, yes, yes, yes.
Nasir Hussain
Just another question. So our expansion into. Sorry, our commissioning of vacuum salt as well as bromine. Are they on schedule or is there going to be any delay or could you throw some light on that?
R S Jalan
That as just said that it is likely to be in the third quarter of 2526. And they’re going at the residue.
Nasir Hussain
Both of them. Vacuum salt as well as bromine.
R S Jalan
Yes. Yes.
Nasir Hussain
Okay, sir. Thank you. That’s it.
R S Jalan
Thank you.
operator
Thank you. The next question is from the line of Akshay Kothari from Envision Capital. Please proceed.
Akshay Kothari
Thanks for the opportunity. Sir, could you attribute the reasons why our capex per ton is one of the highest. I understand it’s a greenfield capacity. So just wanted to understand. Would there be more scope of expansion above 11 lakh tons in the same plant?
R S Jalan
Yes, Akshay, our ultimate vision of that location is 2 million ton.
Akshay Kothari
Okay. Okay. Can you. Sorry,
R S Jalan
I said that growth of that going up to 2 million will be gradual. It will happen depending upon the how the demand takes place. Gradually we will do it.
Akshay Kothari
Okay. And 4500 would be spent for first 5 lakh 50 thousand and then 2000 additional for the next 5 lakh 50 thousand. Is that right?
R S Jalan
The total numbers
Raman Chopra
around 6800.
R S Jalan
6800 crores. And out of that roughly around as you write
Raman Chopra
4200.
R S Jalan
4200 in the first phase. And the balance will be the second round.
Akshay Kothari
Okay. And sir, can you just give a brief about how much is the US over capacity at this point of time? If you have any numbers, it would be great.
R S Jalan
See US capacity is always US production is always largely Depends on the export because they are consuming only around 40% 40%, 40% of their production they are consuming themselves and the balance 60% they are exporting. And their major market is primarily Southeast Asia, Middle east and South America and things like that. India also they export some quantity India as well at this point of time. In terms of the over capacity I would say that I would not be able to call it that as an over capacity that they continue to sell this product and depending upon various market they keep on kind of doing their export to those market.
Akshay Kothari
So is it because the Chinese capacity has come online so China is importing less from us? Is it like that?
R S Jalan
China has not been importing anything from us in the historically except in the FY24 some volume has gone to China which has got now not likely to go this year.
Akshay Kothari
Okay, yeah, that’s it from my side. Thanks for the opportunity. Thank you.
R S Jalan
Thank you.
operator
Thank you. Before I take the next question I would like to remind participants that you may press Star and one to ask a question. The next question is from the line of Saket Kapoor from Kapoor and Co. Please proceed.
Saket Kapoor
Yeah, Namaskar sir and thank you for this opportunity. So firstly when we look at our P and L line item other expenses we find a sequential increase from 127crore to 140crore. So what explains this 10% Q1Q increase.
R S Jalan
There are two part of it. One part is that because if the volume goes up the proportionately the mini cost goes up and the second is that some of the quarter on quarter what happens is some of the cost gets provided in the in the last quarter and that is the if you look at on the year year as a whole you will find that our costs are similar to what last year.
Raman Chopra
If we look at like Mr. Ilana said for the year as a whole our costs are higher by 1314 crore rupees. That is purely relating to volume increase and some CSR couple of crores. So then that nothing beyond that on a quarter on quarter basis year end provision that we have to do. And two areas where the cost is slightly higher. One is insurance and one is forex. Because last quarter there was some refund of around 3 crore rupees in insurance. So that impact is there which is not there this year, this quarter. Last quarter there was a forex gain of around 2 crore rupees.
This quarter there is a dent of around 2 crore rupees. So that 4 crore extra delta is there. So so these two impact is around 78 crore rupees. Other than that it is normal year end provision that are there. I hope I am. I’ve covered both here and as well as.
Saket Kapoor
311 crore is the capex that we have done. Can you provide the breakup?
Raman Chopra
Just. Just a second. I’ll just open that. Yeah. I’ll give you a brief overview. On the growth capex we have spent around 180 crore rupees. That covers Greenfield vacuum, salt, bromine and Zara Zumara. And then on the existing plant the remaining figure has been spent of which largely is seawater pipeline and compressor and some expenditure has been done on salt yielding.
Saket Kapoor
Okay. Jalani, you mentioned that the benefits for MIP has not been accrued. I think so some statement on that. So can you please elaborate how have MIP helped the industry as a whole and company also. And also what how are the imports being for this quarter and for the year?
R S Jalan
See overall MIP I just said the benchmark price which has been set up there at. Okay, one advantage definitely we got is that it’s become a floor price. However the prices overall is slightly better than the minimum MIP price. Okay. That is number one in terms of the import overall this year is slightly lower than the last year. I think roughly around 30 40,000 tons is lower than the last year.
Saket Kapoor
Okay. And 30 40,000 tonnes. But. But taking into account the scenario which you are currently penciling in in terms of the lower demand outlook for the current financial year do you think that the pressure will again be re emerging going ahead in terms of more imports? I think so. Some capacity in US is also expected around 5 million ton to. To be commissioned next year than natural sodas. So what should be your understanding?
R S Jalan
I don’t think the 5 million tons capsity is getting add up next year. It will take another three, four years of time. And the second is that in terms of the outlook going forward. See please understand on one side there will be demand growth also in India. Even if you take the number of 5% we require 200,000 tons of extra volume.
Saket Kapoor
Right. So that.
R S Jalan
Obviously we will have an all those kind of a competitive advantage to kind of a taper down on the import. Let’s see how the situation pans out. But our efforts will always be to kind of a not lose any volume.
Saket Kapoor
Since you mentioned that from Q3 onward the our both the growth project for vacuum salt and bromine will come. Sir, I then for the first half we are. We are almost flat in terms of any any incremental volume benefit because everything is now flown into into the system. In terms of the volume that understanding is correct sir. From Q3 only our vacuum, salt and bromine projects will get commissioned and we are running at optimum capacity utilization level. So for the first half we do not see any volume growth. The first half looks flat in terms of we getting any volume growth.
R S Jalan
I think so. Yes, you’re right.
Saket Kapoor
Okay sir. And lastly sir, we also made a provision for some 50 crore rupees for our new office. Have you spent anything on the same what the timeline we have set for that?
R S Jalan
Yeah, we are taking an office in Ahmedabad. New office in Ahmedabad and the work is going on that. And last year I think we have spent 20 crore on that.
Saket Kapoor
20 crore already we have. We had spent.
R S Jalan
Yes.
Saket Kapoor
Last. Last point was sir, as you have been always being cautious and being guiding us as per the market position is that taking into account the Chinese part of the story where they are the dominant. Can we take into account that the EBITDA numbers which we have been displaying for the last four four quarters that we have been very consistent. That can be given the visionary that can be a base on it or we can. There is a. There is also a chance of the same declining. I think so. Given the current current price scenario what should investors spending in going ahead?
R S Jalan
Sir, I think Saket, you have already very clearly articulated on this that the way the over global economic situations of the geopolitical situation there anything predicting will be very tough at this point of time. And I’ve already said that our strength lies on excellence. What we can do. We are doing the best. You have seen. You are our investor for a long period of time. You have seen that we have demonstrated our ability of what you call cost optimization efficiencies in every area be it production, procurement, utilization, plant efficiencies, plant all those things and we will continue and that’s a permanent benefit which we get in terms of the market outlook.
It can be kind of ups and down. But definitely that this benefit which we are accruing is the ultimate value driver for any organization and that we are continuously doing.
Saket Kapoor
Yes sir. Thank. Thank you for all the answering and congratulations to the board for declaring 120% different maintaining the different payout taking into account looking after all your stakeholders as has been the vision team. I joined the QCEF the and all the best to the team.
R S Jalan
Thank you. Thank you sir.
operator
Thank you. The next question is from the line of S. Ramesh from Nirmal B Equities.
S. Ramesh
Please proceed all thank you for the follow up. So when you refer to the demand from Solar panel glass. While the potential is there. See, last year in the conference it was mentioned that there’s a lot of excess capacity for solar panels and photovoltaics is already built in China. So to the extent that, you know, there could be a time lag in terms of the incremental demand for soda as materializing, whether it’s in India or overseas, what is the actual consumption of soda ash in solar glass that you can share with us in applying 26 and 27 for additional glass manufacturing for solar panels? Try me ask.
R S Jalan
If I can say at this point of a time, currently the plant which already is running there is around 11000 tons of the soda demand per month. Okay. And that will likely to be doubled in 2627. That means we are talking about almost around 1 0.23 lakh tons of extra volume coming in in 2627 because of the plant which has already been announced by the various stakeholders in India that extra demand of 1.23 lakh tons will be coming in 2627. Some of that maybe 50% will be coming this year 2526 and the balance will be coming in 2627.
S. Ramesh
Okay. And in terms of capacity rationalization and your own thoughts on inorganic acquisitions, do you see lot of or do you have any line of sight in terms of any storage capacity closing down globally? And are you looking at acquisitions based on your current cash flows and internal generation?
R S Jalan
In terms of. In Poland there is a plant of 600,000 6 lakh tons which is already been announced to close. Okay. And like I said, some of the plants which was likely to be commissioned or which were under the planning, including the US all getting postponed. So therefore of course we have not heard any other plan to be closed. But I have also said the Chinese prices which at this point of a time are the below the cost, obviously that will hit their bottom line also. And ultimately that will lead to kind of a. Lead to kind of a.
Either the lower capacity utilization or new capacity not coming in. This balance out will happen.
S. Ramesh
And any thoughts on inorganic acquisitions?
R S Jalan
Acquisitions, not Ramesh, because we are not looking at any acquisition outside in India. And I’ve been just told, I don’t know whether to what extent this UK plant of one of the competition, Bowers, they have also announced to close 400 lakh 4 lakh tons or they have already closed this plant.
S. Ramesh
Okay, thank you very much and wish you all the best.
R S Jalan
Thank you.
operator
Thank you ladies and gentlemen. I take that as a last question. I would now hand the conference over to the management for closing comments. Over to you, sir.
R S Jalan
Thank you very much. Like I said in my opening remarks, we will continue to our journey on excellence. And we really believe that, that we are doing what we are supposed to do in terms of the operational excellence. We have done a good job in 2425 and we will continue our journey. Your support will definitely encourage us to do this journey going forward. Thank you, all of you, for your support.
operator
On behalf of MK Global Financial Services limited That concludes this conference. Thank you for joining us. And you may now disconnect your lines.