Gujarat Fluorochemicals Limited (NSE: FLUOROCHEM) Q1 2026 Earnings Call dated Aug. 05, 2025
Corporate Participants:
Unidentified Speaker
Bir Kapoor — Deputy Managing Director and Chief Executive Officer
Kapil Malhotra — Business Head of Fluoropolymers
Analysts:
Unidentified Participant
Rohit Nagraj — Analyst
Rehan Saiyyed — Analyst
Sanjay Jain — Analyst
Ankur Perival — Analyst
Arun Prasath — Analyst
VArchit Joshi — Analyst
Krishan Parwani — Analyst
Nitin Agarwal — Analyst
Meghna Agarwal — Analyst
Pratik Oza — Analyst
Lavanya — Analyst
Presentation:
operator
SA Ram. Ladies and gentlemen, Good day and welcome to The Gujarat Fluorochemicals Limited Q1FY26 Post Results Earnings Conference call hosted by Batliwala and Karani securities 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 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. Rohit Nagraj. Thank you. And over to you, sir.
Rohit Nagraj — Analyst
Thanks, Shida. We thank the Gija Fluorochemicals Management for providing us the opportunity to host the company’s one QFI 26 conference call from the management we have today. Dr. Bir Kapoor, CEO and Deputy Managing Director and the senior members of the management team. Without taking further time, I would like to invite Dr. Bir Kapoor to share his opening remarks post which we can have a Q and A session. Over to you, sir.
Bir Kapoor — Deputy Managing Director and Chief Executive Officer
Thanks, Rohit. Good afternoon everyone and a very warm welcome to all of you for GFL’s Q1 FY26 earnings call. For this call I have with me my colleagues Mr. Athil Jindal, our group CFO. Mr. Manoj Agarwal, CFO of GFL. Mr. Kapil Malhotra, business head of Fluoropolymers and Mr. Rajiv Rao who is business head of our battery chemicals business. The company announced its Quarter 1 FY26 results at its board meeting held today. The results along with earning presentations are already available on the Stock exchange and on our website. I’ll briefly highlight the key financials and then give you an update on our business operations and outlook.
I am pleased to share that from this quarter onwards we will commence reporting segmental data. From now onward we’ll start providing segmental numbers. So let me give you the chemical segments update first. The chemical segment reported a 9% year on year increase in revenue to 1280 crores. In quarter one FY26, EBITDA grew by 33% year on year to 354 crores. With EBITDA margin expanding by 495 basis points to 28%. Profit after tax for the quarter stood at 196 crores making a 69% year on year growth. Consolidated revenue from operations to that 1,281 crore reflecting a 5% increase year on year increase, EBITDA grew significantly by 31% to 300 crore with margins improving around 500 basis points to 27% up from 22% in quarter one.
FY25 consolidated PAT also increased to 184 crore making a 70% year on year growth. This strong performance was primarily driven by sustained growth in our fluoropolymers business and an improved product mix. The management is focused on working capital reduction and thereby the working capital have reduced from 188 days to 172 days in this quarter and efforts are on to further dues over next few quarters. Let me now walk you through the performance of each business segment for this quarter. Our floral segment revenue has been rising steadily and we have now surpassed our previous high to achieve the highest ever quarterly revenue.
We expect this growth momentum to continue on account of growth in new polymer sales volumes driven by already approved qualifications for high end applications in sectors like semicon, Aerospace and automobile amongst others. The capacity which we have added in new fluoropolymer segments over the past few years are expected to reach optimal utilization levels by the end of this financial year. Additionally, we will continue to invest in expanding our chloropolymer capacities to support future growth. Following initial validations and approvals, we are now witnessing strong traction in these segments as reflected in our current performance and outlook.
Rising demand from key sectors such as automotive, semicon and electric vehicles and energy storage systems is opening up significant growth opportunities for us. Based on current customer discussions and approvals, we are confident of achieving around 25% growth as guided earlier in our chlorochemicals business segment. We are excited to announce the start of commercial production of R32 in Q2 FY26 which is several quarters ahead of schedule. This has been achieved through strategic retrofitting and at minimal capital expenditure. We aim to ramp up our R32 capacity, the 20,000 metric ton in phases by the end of this financial year.
Further capacity additions plan will be firmed up Looking at the market opportunity. With. This addition, we now offer a complete range of refrigerant products including R22, R32, R125 and R4N. The specialty chemicals segment remained stable during the quarter and is expected to see steady improvement going forward. Our bulk chemical segment saw a slight decline in revenue during the quarter mainly due to lower caustic soda prices and a planned CMS plant shutdown. We expect this segment to normalize in the coming quarters. Turning now to our battery chemicals segment, this segment is emerging as a cornerstone of our future growth, further aided by the global demand for battery energy storage to support large scale global developments in AI ML workloads, global capability centers, expansion EV infrastructure and renewable energy deployment, all of which are accelerating the adoption of battery storage systems.
A major catalyst is a recently introduced bill in the United States which expands subsidies beyond electrical vehicles to include energy storage systems. The bill offers a substantial US$45 per kilowatt hour subsidy covering approximately two thirds of the battery costs, making large scale battery productions in the US not just feasible but highly attractive. Importantly, the bill also introduces supply chain safeguards requiring up to 85% of inputs in the next few years to be sourced outside the prohibited foreign entity category over a period of time. Currently, the largest supply chain for battery material is originating in PFE category country, therefore providing an excellent opportunity for our battery material business to present an alternate supply chain option to our customers.
We are exceptionally well positioned to lead this space. Our existing capacities and initial approvals give us a strong foundation for global leadership. Besides our electrolyte and salt plant commercialization, our LSP Camp plant has successfully completed pre commissioning activities and our LFP pilot plant is also now operational. We are actively developing customized grades tailored to customers specifications reinforcing our commitment to innovation and responsiveness. This is a pivotal moment for our battery materials business and we are confident in our ability to capture the opportunities ahead. Let me now touch upon the recent US tariff announced on India where an additional duty of 15% has been imposed taking the total to 25% from 10% previously.
The products however, like PTFE and micropoders and majority of our battery materials are exempt under the reciprocal duty list. The revised duty however applies to a few of our new chloropolymers as these products are highly specialized with very few suppliers globally and having a long qualification cycle. We believe it will not be easy to develop an alternate supply chain in short to medium terms. Therefore, we do not see any significant impact on our business. To summarize, the fluoropolymer segments will benefit from incremental sales of high value added products. Fluorochemicals will see significant increase in revenue driven by commencement of our R32 business and our battery material business is poised for significant ramp up in the medium to long term.
We remain confident of delivering sustained growth and creating long term value for all our stakeholders. Thank you and we are now open the floor for questions.
Questions and Answers:
operator
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 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 on the line of Rehan Syed from Singatra Asset managers. Please go ahead.
Rehan Saiyyed
Yeah, good evening to our team and. Thank you for giving me the opportunity. So I have a couple of questions. First on the flora polygon side has reach all time high in this quarter. So is this run rate sustainable and what visibility do you see in the volumes for the rest of the upcoming quarter?
Bir Kapoor
Rehan, we have already stated that we expect the fluoropolymer business to achieve a growth of 25%. And we see that happening probably by the time we complete the financial year. And we expect this revenue growth to continue quarter by quarter.
Rehan Saiyyed
Sorry, I think I missed that part. Okay. Okay, I noted. And your second question is for customer approval pipeline side. So can you elaborate on the customer approval for the new high polygon especially for semiconductors and added specifications?
Bir Kapoor
Sure. I will request Mr. Malhotra to.
Kapil Malhotra
So I also mentioned in the previous calls also that couple of high end applications especially semiconductor we had mentioned in our statement aerospace, automobiles. So we have also got couple of high end polymer approvals from the western countries also and also from far east countries. So the commercial business also has started from these applications. Every quarter coming up we expect these numbers to ramp up and the business to grow up continuously. And more approvals to come consequently from other customers also.
Rehan Saiyyed
Okay. Okay. So my last question is just understanding like regarding my. That you have stated right now regarding the US target like we are dealing with in the specialty type of chemicals. In the US market. So that’s why we are not incented towards the 15th of parabola. My understanding.
Bir Kapoor
No there are specific products. Which I mentioned
Rehan Saiyyed
like R125 and R4108.
Bir Kapoor
Right. I don’t think our the refrigerant gases are part of that. The PTFE and micro powders are part of it. And majority of the battery materials are part of it from the reciprocal duty list.
Rehan Saiyyed
Okay. Okay. That’s it for my. Sir, thank you for taking my question.
operator
Thank you. I request each participants to ask two questions. The next question is from the line of Sanjay Jain from ICICI Securities. Please go ahead.
Sanjay Jain
Yeah. Thank you. Good afternoon sir. Thanks for taking my question. Couple from my side. First on the R32 can help us understand what is the capacity we added now by retrofitting the existing client. And we said in the opening remark that we are looking to scale up to this 30,000 metric ton by end of FY26 is that right? Understanding or you will wait for validation of this product and then you would want to expand and take a decision or we have already started the work on expanding.
Bir Kapoor
Not really. Thanks Anjesh, thanks for your question. First of all we have already since this is a retrofit we have already done, we have already checked the materials and it’s already qualifying. We have also shipped our first shipment to our customers. So the plan right now is not wait and then expand since we are retrofitting it is done in phases. So as I had said I had stated 20,000 done by the end of this financial year and then we’ll decide on the further ramp up plan based on the looking at the market opportunities available to us.
Sanjay Jain
Okay, so by when are we expecting this existing plant? I don’t know what capacity they have added to reach the optimal utilization and what is the capacity with this first phase we have done.
Bir Kapoor
So Sanjay, it will not be appropriate for me to give the exact capacity now but of course it’s in upward to 10,000 that we had indicated and we’ll slowly ramp. It up going forward
Sanjay Jain
and the remaining 20 will also come as a retrofit or it will be a fresh climb.
Bir Kapoor
Everything will come as a retrofit. Of course it may require some amount of balancing equipments to be added because always retrofit there are imbalances. When I said end of the year because that means we’ll be adding some equipments to debottleneck and ensure that we achieve that capacity that we’re talking about.
Sanjay Jain
And when are we expecting to reach the 10,000 capacity to its optimal utilization? This quarter possible Q2.
Bir Kapoor
So I think capacity utilization we’ll probably share you a little later but we expect it to looking at the market opportunity that is available to us, we expect that utilization to happen rather fast.
Sanjay Jain
Got it? Got it. Second on the fluoropolymer you said that we have a good visibility on order book and you reiterated the guidance of 25% for this year. First quarter wasn’t 25%. So what is giving us the confidence? And then there is an uncertainty of US tariff which is very large market for us. I know PTFE doesn’t get impacted but new fluoropolymer does. So what is giving us the confidence of this 25% growth?
Bir Kapoor
So I’ll just make one comment then I’ll hand it over to Kapil to add more. The first thing is you know, because since we have already been approved and as you know the fluoropolymers these are very specialized products. After approval, normally the orders start at a relatively small level and then keep building up. But that is what is giving us confidence because we have large number of approvals in place. Now coming back to the capacity, this tariff situation US is a large market for us. But if you look at the volumes are very large in case of PTFE and micropoders which are in the example, new polymers are indeed part of it.
But there’s a certain level of, you know, stickiness to that business and I’ll let Kapil add to that.
Kapil Malhotra
Yeah, singesh. So as Dr. Kapoor has mentioned in the US as PTSD and microcosm are exempted, however, all the new chloropolymers, they command a very special application as we have mentioned, couple of application names also. So the demand is inelastic of the prices majorly and we expect that we should be able to majorly negotiate the all the prices as per the tariffs slowly and steadily and should be able to continue the business. Our approvals as I mentioned are already on and some of the other approvals will keep on happening with every subsequent quarter and the ramp up will keep on happening in the business as and when we keep on getting these approvals.
And also the commercial business keeps on improving as we keep on getting more orders.
Bir Kapoor
And just to add Sanjesh that the earlier 10% that we’re talking about has already been passed on. So now we are looking at this delta of 15%.
Sanjay Jain
Very clear, very clear. Just on the pricing of R32 with our 20% 20,000 metric ton capacity coming in FY26, do you think prices slightly softened up or you still believe it will be?
operator
Mr. Sandesh, can you sound little louder?
Sanjay Jain
Yeah. Is it good now?
operator
Yes, far better now.
Sanjay Jain
Yeah. On the R32 pricing, it’s been quite firm for a while now. But now the capacities have started flowing in. What is the expectation on the pricing? Because we have seen this in 125 also, right. The prices went up to $18 then pulled off to $5 something like that. In R32 again do you see a risk of rising, normalizing at the levels which were earlier and say at $3 $4 or you still believe a $6 is a sustainable pricing?
Bir Kapoor
Of course we expect the price to remain in the same range and it’s not. And what you’re talking about, R25 was a different situation. The prices on R25 was based on duty in very specific country. In this case R32. Fundamentals of where the R32 pricings are very different and the reasons are very different than 125. And the reason primarily of course is the constraint on the supply side and the prices being high. And one of the largest suppliers in the world. So that’s the reason the prices are high. So we expect it to be continue and but obviously you know it’s a very difficult to project but we expect this to continue in this range.
Sanjay Jain
Very clear sir. Thanks be sir and Kapil answering all those questions and best of luck for the coming quarters.
Bir Kapoor
Thanks. Thank you.
Kapil Malhotra
Thank you.
operator
Thank you. The next question is from the line of Ankur Perival from Access Capital. Please go ahead.
Ankur Perival
Congratulations for a good set of number. And thanks for the opportunity. Just a follow up on the R32 bit from an end use market where you will be selling days. So this will be largely focusing on the Indian market or the proportion on. The export side will be higher.
Bir Kapoor
We’ll be focusing Ankur on the global markets completely because you know this today because we already had 125. So we have a now combination of R32,125 which gives us an opportunity to penetrate deeper with 410 into market all across.
Ankur Perival
Sure sir, that’s helpful. Second bit on the new fluoropolymers you did highlighted we going to almost optimal utilization by the end of this financial year. I recollect we had some expansion plans on the SKP the PVDF side. Almost 300 odd crores by when are we expecting this capacity to come on stream. And secondly if there are any further plans given that we will be optimally utilized by the end of the financial. Year.
Bir Kapoor
The capacities in terms of the investment that we have made is online. Those are the capacity that we are talking about. Because these investments were made quite some time back. And as the qualifications have been received we are getting more traction on orders and the volumes are going up. So in terms of capacity utilization we expect the optimal to reach by the end of this financial year. May I answer your question Ankur? Just a clarification.
Ankur Perival
So you know once we reach optimal utilization number this year I’m sure given the demand environment there will be an incremental sort of market share gain that we’ll be looking forward to. Does this 300 crore capex suffice for that for your growth in 27 or we are looking something beyond that as well?
Bir Kapoor
No, we’ll be looking at more investments in this and I think we’ll give you a better perspective probably a quarter from now. But we have Plans to expand and that capacity capacities in fluoropolymers and so on as we are closing to the optimum capacity utilizations.
Ankur Perival
Okay, great, that’s helpful. And just lastly because of the renewable plant there, there was a saving that we were expecting of around you know, 150 odd crores. Just you know if you, if you can share some thoughts on the timeline around when we can start, you know seeing the benefit from that coming in.
Kapil Malhotra
Request the investment has started, the construction is going on outside and to that extent, you know, you must have noticed in one of our notes to the, to the clause 41 that as a company we invested close to 190 crores till date as an equity. So the total plan is to be a partner in this 450 megawatt of renewable energy and the savings will start accruing from Q3. So basically you know it will come in stages. I think the first installation will happen in Q3 and to that extent the savings will start coming in. You should be aware that 50 megawatt is already operational.
To that extent the savings are already accounted for in our current P and L numbers.
Ankur Perival
Sure. So yeah, just a clarification. The full benefit stands at 150 crore. So let’s say FY27 will see that full benefit.
Kapil Malhotra
That’s right. So FY27 will be the first year of full operation. So the full benefit will be, will be available in that year. You’re right.
Ankur Perival
Okay, great. That’s helpful. Thank you and all the best.
Bir Kapoor
Thank you.
operator
Thank you. The next question from the line of Arun Prasad from Mndes Park. Please go ahead.
Arun Prasath
Thanks for the opportunity. Good evening everyone. I think earlier we had a guidance for this. Our existing business EBITDA of 2000 crores. So in light of these developments with fluoropolymers segment, are we still sticking to these guidance? Second on a like to like basis with the red gas coming in, probably the like to like guidance number should be higher. Right. So if you can guide on this it will be helpful.
Bir Kapoor
Yes Arun, I think if I recall correctly, I don’t think we have given any guidance in the last quarter. Quarter. Of course we had mentioned all along that there will be a 25% growth for volume business. And I don’t think we had given 2,000 crore guidelines in last quarter or so for that.
Arun Prasath
Not in the last quarter. It was mentioned before that and it’s kind of a, kind of a medium term target with the full potential of the fluoropolymers.
Bir Kapoor
Yeah, of course our target is to reach that level. But that guidance we had not given in the last quarter.
Arun Prasath
Right. Okay. So at the current volume run rate is there any possibility that we will be reaching the full potential in this season?
Bir Kapoor
You mean for the fluoropolymers.
Arun Prasath
Fluoropolymers businesses.
Bir Kapoor
Yes, we said that we will reach the full potential by the end of this financial year.
Arun Prasath
Okay. And on the. On the exit of the legacy player, what is that you are seeing on the ground? Anything visibly which is shifting ground and what kind of the impact it is having on the pricing and inventory. Some bit of color on this will be helpful.
Bir Kapoor
Could you come up again? You’re mentioning about the legacy players responding. Hello Arun.
Arun Prasath
Hello. Am I audible?
Bir Kapoor
Yes, yes. Can you come up again please?
Arun Prasath
So we were asking in the exit of the legacy player post that we said that in the second half of effect in the calendar country we should see more impact on the volumes and as well as the pricing. Anything, any development on that front?
Bir Kapoor
Yes, I’ll let Mr. Malhot sir take that. Malhot.
Kapil Malhotra
So Arun, some of the impact we have already started seeing in some of the products and segments and we will continue to see that in subsequent quarters as and when the stocks deplete of these legacy players and we keep on getting our approvals from the customers. So the business is already on and replacements are already on and process is undergoing from quarter to quarter.
Arun Prasath
Okay. And what kind of the impacts we have already kind of say for example in our. In this quarter we have shown a few increase of 12%.
operator
Mr. Arun. But I request you to rejoin the queue for the follow up question as there are many participants left in the queue.
Arun Prasath
Sure. Thank you.
Bir Kapoor
Thank you Arun. Thank you.
operator
Thank you. The next question is from the line of Lavanya from ubs. Please go ahead. There is no response. I’m taking the next participant who is Archit Joshi from Nuama Wealth. Please go ahead.
VArchit Joshi
Hi, good evening team and thanks for the opportunity. So first question on the segment information that we have started providing from this quarter. I see that we sold roughly 5 crores in the previous quarter and 1 crore this quarter from EV products. And adding them to that, if I just take a look at our capital employed disclosure. Our 1658 crores worth of segment assets have largely remained unchanged on a quarter on quarter basis. And we are expecting roughly 1200 crores of capex infusion in the EV products business. First on the sales that you have done.
So where is this exactly coming from? If you can elaborate a bit that what part of the EV product you started selling and if our 1200 crore capex endeavor is still on track. And when do we expect, you know, the assets to start getting be stuck. In the next two quarters? That was my first question. Thank you.
Bir Kapoor
Thanks Archit. Our EV business as I stated earlier is we are looking at the longer term growth opportunities in the short term, of course. Now the sale that we’re talking about is very, very small. And those in my view is still not trickled in. We expect the sales from the EV business to start trickling in by the second half of this year quite a little bit. Okay. But we will start seeing more meaningful numbers perhaps in FY27 which will start seeing the full impact of our, the capacity that we have set up. Now coming to your next question about cwip, I mean this is approximately, this is a very, we have been around 1000 crores I think in GFL, which is approximately because we have various projects which is going on at multiple units and this is a typical number that we see because as these projects get commissioned, we take them, we capitalize them. So we do not see Anything unusual this 1600 crores number because we have a large number of projects going on and particularly of course in EV where a large number of projects are under construction and under commissioning.
VArchit Joshi
Sorry, still not kind of fully clear. I mean I’m just referring to the presentation where we have given a divide that we’ll invest 400 crores this year in GFL and 1200 crores in EV. And my question was largely pertaining to just getting a sense that how are we seeing capex in the EV sticking with the 1200 crore capex.
Bir Kapoor
Okay, I’m sorry, we had already indicated that we have invested close to 1300 crores in EV to the last financial year and we are planning to add another 1200 crores in this financial year going forward and it remains as per the plan. Okay. So there is no change in the EV plan as of now.
VArchit Joshi
Got it, Got it. Understood. So one more question on the fluoropolymers bit with of course knowing that the legacy player has exited and we have displayed a very solid performance in fluoropolymers. The next leg of capex that you are planning, maybe this 400 odd crore number. That alluding to the presentation, any particular fluoropolymer that we are targeting, Is it more ptse, LED capacity, addition or skm, scp? Anything that you might want to give a broad directional, kind of a guideline as to which, you know, within the product mix, which would be something that one should look out for in Terms of growth prospect.
Bir Kapoor
Yes, thanks. Let me Mr. Kapal take that.
Kapil Malhotra
Yeah, yeah. So this investment is going to be across all the fluoropolymers including PTFE and new fluoropolymers.
Bir Kapoor
It’s difficult for us to bifurcate because we see a growth opportunities in every.
Kapil Malhotra
Product which we have in our portfolio. So it’s going to be across all the products.
VArchit Joshi
Sir, just an addendum to the previous one. I think we did have some plans within PVDF also to develop the solar grade and I think I recall from previous notes about 2500 odd tons of PVDF capacity addition. Is that all in place and are we seeing any ramp up in solar grade pvdf? Where are we in that development if you can.
Bir Kapoor
So I think that 2500 capacity addition that we had probably may have mentioned earlier because lately we have not been giving any details on the capacities. But coming back to this capacity of pvdf, this is largely for EV products, EV binders and that capacity is in place. Okay. We are going through the final stages of qualifications now and PVDF binder being material that goes into cathode, it requires a very long qualification process. So in PVDF we are at a very final stages of qualifications. In fact it’s going through the scaled up trial right now and we expect qualification to be complete by the end of this calendar year.
VArchit Joshi
So nothing on the solar part. Right. This is all binders now maybe that and was stalled. Is that a fair assumption?
Bir Kapoor
In tvds most of it is for binder applications which is EV or batteries and some.
VArchit Joshi
Sure, sure. Understood. Thank you sir. Thanks and all the best. I’ll come back in with you.
operator
Thank you. The next question is from the line of Krishan Parvani from JM Financial. Please go ahead.
Krishan Parwani
Yeah, hi sir, thank you for taking my question couple from my side. First just book question. What has led to decline in the other operating expenses during the quarter which has resulted in EBITDA margin expansion?
Bir Kapoor
Normally the previous quarter was the year end quarter. So we have normally a lot of provisions related to CSR which often comes in in the last quarter as other expenses. You look back in previous quarter Q3 of last year, this quarter is less in line with that.
Krishan Parwani
So this 211 crore range is a sustainable range going ahead till the time our power expenses, probably the renewable thing comes in. But I think that will capture the. Power expenses not in other expenses.
Bir Kapoor
Of course you know there will be a natural increase in the expenses over time. But of course it will. When you say sustainable it doesn’t not go back to 244. There will be some minor increase which will appear in the other expenses but continue to be in the same range.
Krishan Parwani
Got it. Secondly, on R32, on which existing capacity you have done the retrofitting and when do you expect to fully utilize your 20,000 ton capacity?
Bir Kapoor
This has been done from one of our existing plant and as I said that we will reach 20,000 tonnes by the end of this financial year. But the way we are planning is that it will not have much impact on any of our existing products that we have.
Krishan Parwani
So basically the plant that you have done the retrofitting was probably not contributing to our top line meaningfully. And then that’s why the loss in. The top line would not be meaningful. Is that what you are indicating?
operator
Sorry for the inconvenience. The line for the management has got disconnected. Give me a moment, I will join the management back.
Krishan Parwani
Sure.
operator
Welcome to Chorus Call. Please hold for an operator. Welcome to Core Sport. Please hold for an upgrade now. The management line is now connected. Mr. Christian, you can ask your questions now.
Bir Kapoor
Sorry Christian, we got disconnected. I think we’re asking about the capacity utilizations and impact from the existing revenue. Yes sir. That there won’t be any impact at all because there have been internal adjustment debottlenecking and it will not have any impact on offer existing products.
Krishan Parwani
Got it. And the second part of that was like I understand that 20,000 ton capacity is coming up by F26. I was asking more like when do you expect to fully utilize it that. 20,000 capacity of R32?
Bir Kapoor
Looking at the market situation, we expect that to happen quickly. However, I mean there’s. We cannot really say but probably next few quarters after that.
Krishan Parwani
Got it. And last bit if I may on the fluoropolymer side, in order to achieve 25% Viva growth guidance that you’ve given. So the next nine months we ask about 28% Viver growth. Wanted to understand would it be largely volume growth for or how would that be?
Kapil Malhotra
Yes, it will be largely driven by the volumes. As we were already mentioning that we are under the process of pitching in for the legacy players and also the approvals from coming from the other sectors on the high end grades. So that is predominantly giving us the growth and from there we expect the volumes to grow up the way we have position.
Krishan Parwani
Thank you for answering my question. Wish you all the best.
Bir Kapoor
Thank you. Thank you.
operator
Thank you. The next question is from the line of Nitin Agrawal from Dam Capital. Please go ahead.
Nitin Agarwal
Thanks for taking a question on the battery Chemical business. Is it fair to say that there is a little bit of a pivot which is there from our end customer perspective from mobility to energy storage? And from a demand supply perspective, are there very different dynamics for battery chemical supplies to mobility applications versus energy storage applications? And does this and do we have, I mean, I mean are we better positioned in ESS versus mobility?
Bir Kapoor
Yes. Nitin, I’ll just add my comment and then hand it over to Rajiv. Yes, there’s a positive impact on us because most of the mobility is uses LFP chemistry predominantly and the ESS uses LFP chemistry. And LFP chemistry typically has a higher salt consumption per gigawatt hour compared to nmc. And second is that of course lfp. The expansion of LFP also gives us a much larger market segment for, for our LFP CAM products. So in both ways it actually is a positive development. Rajesh, would you like to add.
Kapil Malhotra
Yeah. So yes. To your question. There is a movement towards, as far as lithium ion usage is concerned towards energy storage than it was perhaps six months ago. With the growth in artificial intelligence and the data servers that are required to support it. There is a, a huge shift towards looking for stabilizing power supplies to such servers, which is driving consumption, which will drive consumption of energy storage solutions in the coming future. So that will globally. So that will drive the lithium ion battery consumption in energy storage as well as mobility. And as Dr. Kapoor said, most of the energy storage uses LFP chemistry which uses significantly higher amounts of the lithium salts.
So that will drive the increase the addressable market for lithium salts as well as for the LFP cathode activity.
Bir Kapoor
The salt requirement is Nitin, just the rule of thumb is almost double in case of LFP per GWh compared to NMC chemistry.
Nitin Agarwal
And how is the competitive supply side position on this versus in mobility? Are there more entrenched players in mobility versus in energy storage? We are in a better positioning, competitive footing versus mobility. Is there any case like that?
Kapil Malhotra
Yes. So when we look at the markets that we are focusing on, which is the US market, India and Europe, all these geographies are looking to diversify the supply chains and are very keen to find sources outside of China. And when we look at our major products, both LIPF 6 and LSP cathode active material, there are limited suppliers available right now, both for mobility as well as for ESS applications. And we have the advantage, that first mover advantage, having been operating in this segment for the last one year or more in having operating plants, supplying samples and getting Validated.
So we have the advantage of having qualified our products at many such potential users in the markets that we are looking into.
Bir Kapoor
Just to add one more point Nitin, that one of the biggest hubs side that we have now is because of this new bill which actually now has included ESS also as a part of the subsidy in US manufacturing. So earlier this $45 subsidy was not encompassing the battery manufacturing used for for EFS applications. Now this subsidy is being given to all the battery manufacturing and of course with a condition that the input materials or the direct cost attributed for making batteries in US 85% or up to 85% of that cost has to be outside the PFE which is the prohibited foreign entity suppliers.
So as we are not part of that category it gives us a significant advantage in catering to the customer and participate in the supply chain where there are relatively few few suppliers.
Nitin Agarwal
Thank you so much.
operator
Thank you. The next question is from the line of Meghna Agarwal from Mount Intra. Please go ahead. Oh hello.
Meghna Agarwal
Thank you for the opportunity.
Bir Kapoor
Yes.
Meghna Agarwal
Help us with the chemical. Can you help us with the ET of chemical polymer and B chemical?
Bir Kapoor
Yeah Meghna, we do not give segmental EITA margins or EBITDA within the that we have not been providing.
operator
Thank you. The next question is from the line of Rohit Nagraj. Please go ahead.
Rohit Nagraj
Yeah, thanks for the opportunity sir. First question is slightly technical. So we said in our opening remarks and later as well that by FY26 end we will be able to operate the 20,000 tonnes of R32 plant. Now given that the storage requirements for ref gas is different than solids and liquids, how are we placed to a store in case the demand is limited in domestic market and in the exports market? So what is the kind of arrangement that we have made? And a light question to that post FY 2006, if we were to increase the capacity further, we’ve done the remarkable job of retrofitting within a short period of time.
But if you want to go for fresh capacity, will we be able to adhere to the December 26 deadline for newer capacity? Thank you.
Bir Kapoor
Yes, thanks. Thanks Rohit. First of all, you know, the capacities as far as the, you know, storage, etc. We have tremendous experience in refrigerants for a very long time. For almost 35 plus years we have been, you know, the typical storage is in a storage tank plus ISO tank or the small cylinders. So those are of course planned based on the market dynamics demands. So we are not concerned about. So it’s not that we’ll be storing 20,000 ton and then selling it. Not like that normally. But we do not see as an issue. Now coming back to the capacity extension plans the Beyond 20,000, we will of course look at the how market opportunities unfold.
And looking at the market opportunities we may decide it. But definitely we will do it before the whatever this stipulated target date that we have. We’ll add all the capacity before that. Sure.
Rohit Nagraj
Thanks. And just second question again on the battery chemical strand. Given that we are products will be at the last stage of validation once validated. And given that multiple customers are currently validating the product, will there be a Quantum jump in second edge FY26 in terms of the supplies? And that would give us better visibility as far as the battery chemicals revenues are concerned. Thank you.
Bir Kapoor
Hello, can you hear me, Rohit?
Rohit Nagraj
Yes, sir.
Bir Kapoor
Yes, first of all, you know right now, whatever revenue that will trickle in, that will be a significant jump over where we are. However, I would like to speak more about FY27. Then we expect to see of course a very large jump. As these qualifications come in place. We start seeing the orders coming in from the capacity that we already have in place. So in this year of course there’ll be a. Toward the second half you’ll start seeing the revenue trickling in. But majority of it we’ll see the ramp up in 27 and then onwards.
Rohit Nagraj
Thanks for answering all the questions and all the best.
Bir Kapoor
Thanks. Thanks, Rohit.
operator
Thank you. The next question is from the line of Pratik Oza from Systematics. Please go ahead.
Pratik Oza
Yeah, hi sir. Thank you for the opportunity. Just one question from my side. Are you evaluating any manufacturing facilities perhaps through journey in the United States? I think this because that would create a shorter supply chain and also helping optimizing our working capital.
Bir Kapoor
I’m sorry, it’s still not clear. Pratik, could you repeat the question? It’s not very clear.
Pratik Oza
Yeah, hello.
Bir Kapoor
But it wasn’t clear. Could you repeat that please?
Pratik Oza
Yeah, sure. So what I was asking is, are you evaluating any manufacturing facility perhaps to GVs in United States asking this because I mean that would create a more resilient and a shorter supply chain and also maybe helping optimizing our working capital.
Bir Kapoor
We are right now not looking at it us or any JV like that. So we are not looking at. Definitely not. If you mean to say in chloropolymer. So we are not looking at that at the moment.
Pratik Oza
Okay, got it. Thank you.
Bir Kapoor
And moreover, Prateek, you know, because we have a very Integrated facility in India right now. At least in case of fluoropolymers where the cost and the entire processes has been optimized. We do not see that happening if we move far away from this integrated facilities that we have.
operator
Thank you. The next question is from the line of lavanya from ubs. Please go ahead.
Lavanya
Hi sir. Thank you for the question too. Sorry, got this earlier. Most of my questions are answered. Just one clarification. Is it better now?
operator
Better now. Thank you.
Lavanya
Yeah. So 20,000 ton for R32. Is it the additional capacity or overall capacity that it will be reaching by end of 32 by end of this year?
Bir Kapoor
This is the total capacity because we were so far not manufacturing R32 we have just started. So our 20,000 will be our total capacity of R32 per year that will be reaching by the end of this financial year.
Lavanya
Okay, so just retrofit question the earlier participant asked this retrofit is not impacting capacity of all other refrigerants that we have. Is that understanding? Right?
Bir Kapoor
No, it will not impact any of our existing product lines in the freelance or any other product.
Lavanya
Okay. And one on fluoropolymer, the 25% growth rate guidance is factoring in the benefit that we are expecting with the exit of the player. Is that right?
Bir Kapoor
Yes, that’s all been factored in lavanya because there has been. Because there’s been several factors which is contributing to this growth and one of them is what we stated which is exit market opportunities created by exit of legacy players. Yes, thank you.
Lavanya
Got it. Thank you. Thank you so much sir.
operator
Thank you. We will take that as the last question. As there are no further questions from the participants. I now hand the conference over to Dr. Bir Kapoor for closing comments.
operator
Thank you very much. And once again I would like to thank you all for interest in Gujarat Fluorochemicals. Clearly, as I had stated earlier, we are looking for a very solid growth in fluoropolymers as business as we go along, which is our core. And we also see very strong opportunities that is emerging in our new business of battery materials. The large number of the factors which are all playing very positive for us. We are very well positioned today to play a leadership role in the segments. By the next quarter or so we’ll have most of our products will have our commercial scale facilities ready going through qualifications.
So this presents a wonderful opportunity for our battery material business going forward. So with this I would like to thank you all for interesting in the draft floor chemicals and look forward to connecting with you again. End of next quarter.
operator
Thank you on behalf of Bartliwala and Karani securities India Private Limited. That concludes this conference. Thank you for joining us and you. May connect your line.
Bir Kapoor
Thank you.