Gulf Oil Lubricants India Limited (NSE: GULFOILLUB) Q3 2025 Earnings Call dated Feb. 07, 2025
Corporate Participants:
Ravi Chawla — Managing Director And Chief Executive Officer
Manish Gangwal — Chief Financial Officer
Analysts:
Sudeep Anand — Analyst
Probal Sen — Analyst
Sabri Hazarika — Analyst
Kirtan Mehta — Analyst
Yogesh Patil — Analyst
Chirag Fialoke — Analyst
Harsh Maru — Analyst
Pratik Dedhia — Analyst
Hardik — Analyst
Nisha Mulchandrani — Analyst
Presentation:
Operator
Ladies and gentlemen, you’ve been connected to Gulf Oil Lubricants India Limited Conference Call. Please hold the conference will begin shortly. Ladies and gentlemen, you’ve been connected to Gulf Oil Lubricants India Limited Conference Call. Please hold the conference will begin shortly hell and gentlemen, good day and welcome to the Q3 FY ’25 Earnings Conference Call of Gulf Oil Lubricants India Limited, hosted by Systematix Institutional Equities. 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 any assistance during the conference call, please signal an operator by pressing star then zero on your test on phone. Please note that this conference is being recorded.I now hand the conference over to Mr Sudeep Anand from Systematix Institutional Equities. Thank you, and over to you, sir.
Sudeep Anand — Analyst
Thank you. Thank you. On behalf of Systematix Institutional Equities, we welcome you all to the Q3 and nine months FY ’25 conference call of Gulf Oil Limited. From the management side, we have Mr Ravi Chawla, Managing Director and CEO; and Mr Manish Gangwal, CFO. I’ll now hand over the call to the management for their opening remarks and followed by the Q&A session. Over to you, sir.
Ravi Chawla — Managing Director And Chief Executive Officer
Thank you, Mrs Ravi Chawla. Good day. Good evening to everyone who have joined us on this call. I’d like to start-off by, of course, wishing all of you a happy New Year. We are in the New Year 2025. And of course, we are also delighted to share with you that Gulf Oil in-quarter three, we have achieved the highest-ever revenue and the highest-ever EBITDA in our — ever in our history of Gulf Oil. We had seen that there were definitely macroeconomic headwinds in India with the elections, other things had slowed down in-quarter two and quarter three, but we have been focusing on our — how can we capitalize on the opportunities, navigate what’s been evolving.
So really for us, this highest-ever quarterly volume and a strong double-digit top-line growth of 11% year-on-year, crossing these two milestones of INR900 crores in revenue and INR122 crores in EBITDA for the first time ever in a quarter have been also showing the strength that we definitely our resilience, our team efforts to deliver even when macroeconomic conditions are facing headwinds. And of course, we are seeing some early signs of recovery — demand recovery. So that’s really one of the highlights.
So we delivered also our highest-ever core lubricants volumes of 38,500 KL during the quarter and this is a growth of 7% year-on-year. So that’s another good thing that happened in-quarter three. Of course, growth was seen across all major segments for us. You know, it was in this quarter largely driven by double-digit growth in our motorcycle oil segment and a good double-digit growth in B2B. Definitely in B2B, we saw sub-segments like infra and industrial giving us this double-digit growth.
We’ve also seen that we’ve seen our B2C sales also grow due to the MCO and that’s another thing. And our premium range of products, we saw a much higher-growth level, double the normal growth rate. So these are the things which well for us. We also had a few other achievements which we’d like to share with you. Definitely, we had the strategic partnership in Neara where we are expanding to the network of 6,000 outlets. We are already selling lubricants there. The Ad also gets sold and definitely this is going to help us to create availability.
So this process has now started. We renewed our exclusive partnership with India till 2032 now and continue to deliver high-quality lubricants in the — across their ranges and even two-wheeler range of high-performance sports bikes got added. We have obviously got this partnership till 2032 and we also have extended our long-term partnership with Piago for the commercial vehicle segment up to 2030. The other good thing that happened this quarter is we had reported AdBlu was slightly soft in-quarter two. It picked-up in-quarter three and that’s again a good sign for us.
And I’d like to also mention that we had mentioned about our mega brand campaign, the Unstoppables, which was 360 degree campaign, which started towards the end of September, that continued and this featured all our three brand ambassadors. It was actually a very creative and technology savvy campaign which had — was released like a movie is released and right from the Song launch to finally on-the-ground campaign using outdoor. This was right across retail outlets in all types of media, social media handles using influencers. This was a big success and I think it solidifies our brand consumer bonding and also did give opportunities for deeper engagement and a long-term affinity. We had another major event when we are looking at the high-end of the biking segment. We’ve been looking at that as an investment all-around in terms of products, reach-out programs and also building the brand through influencers. And we had sponsored India Bike Week, which is actually a very strong property, which is the biggest in India in terms of the adventure premium biking motorcycle enthusiast. This is held once a year in Goa and it’s one of the biggest in India. It is the biggest actually. And we had more than 25,000 motorcycle enthusiasts riding all the top-end bikes and Gulf is the title sponsor there. We had lots of activities and I had myself gone for the event. It’s a very, very good event with lot of — lot of creation of many properties from Gulf and lot of OEMs there, lot of passionate riders. There’s a club — club village that 62 motorcycle clubs come from 15 cities. And we have a property called Ride with Gulf, which is our initiative on social media, lot of influencers. So really this has been a good platform. So we continue to build our brands. Of course, we are still trying to keep it in the 3%, 3.5% range and that’s where we are. So I’ll now request a — yeah, I just want to also mention on Tyrex., as you know, we have got a majority share there, the subsidiary and this continued to perform well and the nine-month top-line is at INR40 crores, which is nearly three times growth during this period versus last year. Healthy order pipeline is there and we are on-track to close the year-on a strong note with this business, which is going to add to us. Our brand Electrophy, which is a software as a service company where we have an investment that continues to perform well, securing new customers in the nine-month period. So two other good initiatives that are reaching a good stage of, I would say, to take-off as the EV enthusiasm on EV products as we see all-around also going up in India. So I’d like to now hand over to Manish to take you through some of the other highlights and then, of course, take your questions. Thank you. Over to you, Manish.
Manish Gangwal — Chief Financial Officer
Thank you, Ravi, and good evening, everyone. So as Ravi mentioned, we had a very healthy performance for Q3 and with a double-digit revenue growth and EBITDA of INR120 crores, which translated into an EBITDA margin at 13.5%, a sequential basis improvement of nearly 90 basis-points, which is auguring well towards our guided bend of 12% to 14% towards the higher-end. And for the nine-month period also, we continue to deliver very strong performance with nearly 21.5% PAT growth and 14% EBITDA growth. So overall, the financial performance continues to do very well.
On the gross margin side also, you will see that there is an improvement sequentially in the gross margin — at the gross margin level, which means that the input costs have been relatively stable, although there was a depreciation of the rupee, which started during the quarter and continues as we speak. And obviously then that requires the margin management to kick-in. But in-spite of that we have been able to improve our gross margin led by-product mix improvement and overall segment mix.
At the same time, you will see that the improved, volumes improved and at the net-debt level will continue to remain a debt-free company with a net-debt of — net cash position now upwards of INR450 crores at the end of December. Our working capital has improved from the last quarter by nearly around five, six days. So overall, on the financial side also it has been a very good quarter for us overall. The only thing you will see also in the result published is that the quarter-on-quarter finance cost has gone up and that is because of the forex loss because of rupee depreciation which on our working capital loans and that was an impact of around INR5 crores for this quarter, although first H1 we were in a — we were having a net forex gain. So for the YTD Nine-Month period, we are at nearly INR3.5 crore of ForEx loss as depreciated sharply towards the end-of-the quarter, especially from November onwards. So with that note, we would be happy to take Q&A from the investor. 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 test on telephone. If you wish to remove yourself from the question queue, you may press star. Participants are requested to use handset 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 Probal from ICICI Securities. Please go-ahead.
Probal Sen
Thank you very much. Thanks for the opportunity. Good afternoon, sir. Just a couple of questions. Firstly, as far as the margin improvement is concerned, given the way that crude has behaved where it probably strengthened a bit towards the end-of-the quarter, but after that has once again softened back and now is at sub $75 levels. How should we be looking at the margin trend? Of course, as you rightly mentioned, this is offset a bit by the rupee depreciation, which has been a significant drag.
But on the whole, are we confident that we can maintain this trajectory of improvement that we have seen in the last quarter-over the next couple of quarters? That was my first question.
Ravi Chawla
So thank you. I think as you rightly picked-up, while there is a stability in the food, it went up above $80 for some time, but then it stabilized in the range of around $75. And as long as the food remains in this trajectory of $75 to $80, the input cost should remain stable. Of course, the base oil follows with a lag and there is a demand-supply situation in various grades of base oil. But largely, we are hopeful that with crude stability, the base oil prices remain stable, but the landed cost because of rupee depreciation obviously goes up because India imports a large part of base oil from overseas, including ourselves.
And that impacts the landed cost. So we — as I mentioned in my opening remarks, we will closely monitor the landed cost situations across base oil category and we’ll take accordingly the actions in terms of margin management. Our guided band of EBITDA, which is 12% to 14%, definitely we will be maintaining that band going-forward as well, at least for the Q4 and quarter one of the next year is what we currently estimate.
Probal Sen
Right. So just on pricing, sir, did we have any significant price changes that saw in our business in this quarter?
Manish Gangwal
Do we keep evaluating the margin management scenario, as I mentioned and obviously the competitive action also is there in the market. And based on that, the scheme rationalization and some sort of discounting which we — which is there quarterly schemes are there, we try to rationalize those in the interim. And if there is a major change in the input cost, then the MRP level changes also are affected. So we closely monitor both trying to rationalize through the scheme adjustments. And if not, then the MRP level changes are also announced. So we’ll closely monitor that.
Probal Sen
Got it. Sir, the second question was more housekeeping. I’m sorry, I didn’t quite catch the exact number of the core lubricant volume and volume, if you can kindly
Manish Gangwal
38,500 KL is the lubricant-core lubricant volume during the quarter and is at 36,000 KL.
Probal Sen
Okay. Okay. And sir, just one last question, if I can squeeze in one. As far as Tyrex is concerned, the trajectory of growth that you mentioned where it has grown substantially in the nine months of this year. Any guidance you would venture to give us for what target is there for FY ’26? And in order to support this level of growth, does that require a little bit more investment, whether internally or from your side?
Manish Gangwal
So direct, which is where we have 51% stake are into DC fast charger manufacturing and their last year’s full-year turnover was around INR25 crores, where this year in the nine-month period they have crossed around — they are at around INR40 crores.
Probal Sen
Right
Manish Gangwal
And usually the quarter-four is a stronger quarter because many of the orders are materializing in the quarter-four. So we will — as our previous calls, if you refer, we said that we would like to double the revenues every year for the next few years Years and that is where we want to highlight that we are on course for that and definitely we should end the year-on more than double of last year’s revenues and trajectory for the next one, two years also remains on that way.
Probal Sen
Okay. And with regard to the investment, sir, does that mean any increase in investment required or that’s not really the sufficient capacity to support this kind of revenue growth without any huge investments.
Manish Gangwal
So the — all the investors will recall that out-of-the — when we acquired the company, 51% in the company, INR65 crore was invested as a primary investment into the company. And a part of that money is still lying with them to take-up some of the expansion projects for capacity increase in the — and trying to — we are looking for a slightly enhanced capacity plant and the work is on for that. But till such time for the next one to two years, they have sufficient capacity, plus there are some working capital arrangements needed as we increase the volumes, which are also in-place. So no major funding from — for the expansion is as of now seems necessary from Gulf Oil to tax.
Probal Sen
Okay. Got it, sir. That’s very, very useful. I’ll come back if I have more questions. Thank you so much for your time.
Operator
Thank you. Thank you. A reminder to all participants to ask a question, you may press star and one. The next question is from the line of Sabri Hazarika from Emkay Global. Please go-ahead.
Sabri Hazarika
Good evening, sir. So congratulations on good numbers. So I have got a few questions. Firstly, with respect to your volume breakup, so how has — you mentioned about MCO, but overall, how has the different segments seen in terms of growth during June Y-o-Y.
Manish Gangwal
So overall, as we — as Ravi highlighted, our motorcycle grew double-digit and industrials also grew double-digit. Rest of the volumes were in the mid-single digits. So overall, we have been able to deliver two-est growth across most categories. Everyone was slightly subdued in the quarter, but overall, we have been able to deliver plus volume growth of the industry. And our mix also slight improvement in the personal mobility, as Ravi mentioned also that MCO was a very good growth. So from the classification perspective, diesel engine oil was around 39% and personal mobility went up by 2%, so nearly 23% for the quarter and rest were others and industrials as we keep highlighting.
So overall, yeah, good growth in certain segments, especially in motorcycle and B2B.
Sabri Hazarika
So CV, DEO factory field has been the area of weakness. So ex of that, what could be the growth and how are you seeing the current scenario in terms of factory fields?
Manish Gangwal
So obviously, the excluding factory field, our quarterly growth was around 7.5% since the factory fill still was for the quarter negative, although we saw an improvement starting December. And as we speak, there is a traction which is coming back-in the factory cell business. And because of this overall DEO volumes are also in the mid-single-digit growth last quarter, but we are seeing an uptick there clearly from the factory side and then the rotational effect will also come into in the coming quarters as well.
Sabri Hazarika
So if normalizes or say suppose grows at a positive rate, then could you be like closer to 10% sort of like Y-o-Y growth in volumes?
Manish Gangwal
Mr, just to highlight, our Nine-Month volume growth for the current year, excluding factory field is also around 9%. So we are very close to the double-digit mark even in the current year, excluding factory field, given the environment we were into in terms of the overall macro-economy and the Indian economy. So that gives us a lot of confidence going-forward that once even some of the business pieces like factory field, et-cetera also start firing, then obviously, we’ll continue our trajectory of two to three years the market growth rate. That is the expectation we have.
Sabri Hazarika
Okay. Then on EdBlue, so the volumes have picked-up this quarter. So how do you see the overall trajectory of EdBlue for the next, say, two, three years?
Ravi Chawla
Yeah. So you’ll see we have been looking at 10% to 15% growth in this segment. I think that is where we see it. Obviously, there are more opportunities now with, we have entered into a tie-up. So I think our — we would want to want to look at how we are — we maintain ourselves as a high-quality brand. And I think that’s the outlook. And of course, Neara is going to add an opportunity of outlets. We’ll have to — out of their total outlets, we’ll have to see what is the consumption. And I think it augures well for us to try to touch about that 15% mark, but between 10% and 15% is what we could aim for.
Sabri Hazarika
And is there scope for margin improvement in EdBlue also? I mean, it’s like a single-digit margin product, but can there be any improvement there just because of the fact that the volumes have almost become as big as lubricants itself.
Ravi Chawla
So you see, we have positioned ourselves with many brands with OEMs and our own brands which are in the market and it’s more, as you see a supplementary requirement to diesel engine oil. So it is going to continue to be competitive. And I think we will obviously have to look at-market pricing because it’s consumable. So it needs to be effectively a people who use the product probably by monthly basis. So it has to be price-competitive. So I think it is important to have the right distribution. And of course, we want to maintain the margins because competitive intensity might go up in this segment as the product gets more used.
Sabri Hazarika
Got it. And yeah, other expenditure, I mean, it was slightly higher. Is it because of the campaign and the ad spends due to which it was sort of like higher?
Manish Gangwal
And therefore, it is also linked to the ad volume increase as well because last quarter was a subdued adlu volume and the freight components and all are goes up. So it has to do with that. A&P wise, the quarter has been, you know around 3% of the top-line. So we are back to our normal range. Of course, there were these special marketing campaigns which were there during the quarter, but we moderated some of our other lines of expenses to keep it at 3% of the revenues for the quarter.
Sabri Hazarika
Okay, sir. And just one question. Yeah. And just last question, any update you’d like to share on the EV fluid segment?
Ravi Chawla
No, I think EV fluids is a small volume, but as we have mentioned earlier, we have more than 10 partnerships in that area. So I think we continue to look at more with both the component makers and the OEMs. So I think that is something which is a steady, but it’s a very small number. So I think that focus to get more EV partnerships is on. And I think that is based on what we would enter into contracts with some EV manufacturers. So I think that is a — it’s a good place to be in. I think we would be in the top three there also in terms of EV supplies, goods.
Sabri Hazarika
Okay, sir. Got it. Thank you so much and I wish you all the best.
Ravi Chawla
Thank you.
Manish Gangwal
Thank you
Operator
Thank you. Thank you. Ladies and gentlemen, to ask a question, you may press star and one. The next question is from the line of Prahul from ICICI Securities. Please go-ahead.
Probal Sen
Yeah, thank you so much for the opportunity again. I just had a broader question, I think it has been mentioned over the last couple of years, the attempt to sort of continue to premiumize our product portfolio and sort of grow the B2C segment because obviously that is a higher-margin segment as compared to the basic factory fill segment. Just wondered your thoughts on how you feel the last 12 months has gone in that direction? And is it fair to say that if the premiumization across categories continues to sort of recover. The guided EBITDA range of 12% to 14% can see an uptick over the next couple of years or rather that is the aspiration as a business that we have.
Ravi Chawla
See, our aspiration is obviously to try to improve our margins. But given that we are present in both B2B, B2C, we have also got currently, as you — as you know, there is — there is obviously products which make X margin and the premium products make higher-margin. If you look at the client study, which talks about value and volume growth, we have seen that 3% volume growth and a 6% value growth. So that is where the premium products come in, the new products come in. Our mix is also B2B and OEMs, a lot of OEMs we do business with. So as a guided overall figure, we say 12% to 14%. And within each of these segments, we are now trying to push our products which have higher-margin, which are premium.
We’re also trying to introduce semi-synthetic synthetic. I gave the example of India bike week. Now India Bike week is all about premium bikes, right, from the KTMs to the Harley-Davidson to the Enfields. So we are looking to sell more there. And obviously, there is going to be a lot of pricing play in various segments, OEM B2B. So as a balanced approach, we believe that if we can premiumize more. So what we are trying to do is supposing we are growing 7% overall, we would like to have the premium products going at least twice that. So given that and that varies The percentage varies of that across segments and that is what is our focus. So value, value range also if you look at that is creating value in terms of pricing. But the market is also moving towards a value range because if you look at rural markets or you look at pricing. We have, for example, a top-end motorcycle oil or I would Call-IT higher-end, we have the synthetics higher-end or range, which we really sell well. Below that, we also have got ranges like a brand called ZIP, which goes into the motorcycle segment. So we have to cater to different markets in different geographies and also price points. Secondhand vehicles are there, they would pay less for a lubricant. So this is, I would say, a complex sort of metrics which we need to keep. But given that if we can improve our premium grades to 12 and again a margin of 12 to 14, we’d be happy to look at the next trajectory of 14% to 16% as and when we come across that the sooner the better for all of us.
Probal Sen
And sir, in terms of the OEM relationships, any updates you can share in terms of any fresh OEM tie-ups that we may have done over the nine-month period itself.
Ravi Chawla
Yeah, we got the two-wheeler business from. So that’s a new business which has helped us, which is the higher bikes of and the and all. So that’s a new one. And I guess we will make some announcements in the next — before the next quarter. We are renewing most of our contracts with our OEMs and we are also talking to is another one which we had, which I mentioned earlier in terms of retail leverage.
Probal Sen
Go-ahead. Sir, with respect to the — with respect to the Nayara tie-up, how will this sort of revenue model work? Just wanted to understand what’s the kind of commercial arrangements, anything you can share outside of what is of course confidential?
Ravi Chawla
No arrangements we can’t. See, they were doing business with two loop companies. We are now doing business with them and one company continues. They have 6,000 retail outlets which they are going to rapidly expand. As you must-have seen the kind of investments they’ve made in the retail outlets. They are both Tier-1, Tier-2, Tier-3 and getting our product available in there and exclusive arrangement for AdBlue.
So I think this is more a distribution come marketing initiative. And you will see now Gulf products available across a lot of their petrol points. And I think this is an opportunity for us to also get our brand more available and reach-out to more consumers. And definitely, arrangements are quite confidential in terms of what we do with various partnerships.
Probal Sen
Yeah. No, no, I wasn’t trying to get the exact numbers, sir. What I wanted to understand was you have to — the way it works is we have to pay a royalty to for every unit of products sold from their outlets, how does it go? That is all I wanted to understand.
Ravi Chawla
That arrangement is actually confidential because we do have to give some margins and sharing between their outlets and also definitely we work together on promotions and all with.
Probal Sen
Sure. Sure. All right, sir. All right. Thank you very much, sir, all the best.
Ravi Chawla
Thank you.
Operator
Thank you. The next question is from the line of Kirtan Mehta from Baroda BNP Paribas Mutual Fund. Please go-ahead.
Kirtan Mehta
Thank you, sir for this opportunity. One question on the near-term volume outlook. Are we seeing uptick in the volume in the seasonally strong Q4? Would we be seeing a stronger growth than Q3 in Q4?
Manish Gangwal
No, our objective always has been to grow two to three times the market. And without being specific, we want to mention that we would like to continue our trajectory of two to three years the market growth rate on an annual basis. Of course, quarters sometimes can be varying because of the seasonality of some of the — like our September quarter is usually a monsoon impacted quarter. But trajectory-wise, two to three times growth is what we aim at for on an annual basis.
Kirtan Mehta
Right, sir. And in terms of the margin, would there be a bit of a sequential pullback in Q4 because of the rupee depreciation and we are taking a calibrated sort of reduction — in reduction in the discounts.
Ravi Chawla
Yes, so it’s ongoing situation, we have to evaluate the margin management as I highlighted earlier also that we keep a very close watch on the margins. And of course, then we — it also in some scheme related adjustments are done, which are shorten, which actually results in an immediate impact and immediate improvement in the realizations. But MRP level changes take some time and we have to wait for that in terms of overall trajectory of rupee now. The good thing is that crude is stable and in fact come down from the recent highs. So that should partly support the input cost in terms of overall impact. But yes, if rupee continues to behave the way it has, definitely pricing actions and/or scheme related adjustment will come in, which will neutralize part of the impact of this input cost increase.
Kirtan Mehta
Right, sir. One more question was about the base oil linkage to the crude. Has that linkage sort of bit broken-down during the last year with base oil remaining more or less stable against the crude variation or has it continued as in the past?
Ravi Chawla
So we have always maintained that if crude, you know, moves on a sustainable basis, that impacts base oil. The short-term movement in the crudes are not impacting base oil immediately because there is a lag effect of one to two months on base oil and within that if the crude comes back, then the short-term impact doesn’t really matter on the base oil side. So the short-term volatility has been more, but the long-term crude are you know, over a full-year basis, the crude has remained quite stable and that is where base oil also has remained quite stable for the year.
Kirtan Mehta
Sure, sir. And would you be able to give more color between the sort of group 1, Group 2 and group three basis, how the trend has been and drivers?
Ravi Chawla
So that depends on the demand and supply and some of the refineries only made Group 1 basil, some of the refiners only made Group 2 and they take as maintenance shutdown for a longer period, then the availability sometimes globally becomes a short for a short-term period. So — but — so yes, there are challenges sometimes on the individual grades of base oil, but overall, I think on a larger horizon basis, everybody then follows root over a longer period. If you plot a chart of base oil and fruit for five years, you will find lot of symmetrics.
Kirtan Mehta
And what would be our consumption of Group 2 and Group 3 at this point?
Ravi Chawla
We are — we have been one of the large consumers of group two, group 3 vessels because all our premium grades and long grain products are based on group two, group three formulations. So yes, the proportion of group 2, Group 3 basals is quite high in our overall portfolio.
Kirtan Mehta
And in terms of the — one more question probably on the, do we also sort of get the annual rebates as well on the base oils where that can support our margin at the — on a sequential quarterly basis?
Manish Gangwal
And so we follow accrual basis of accounting. So whatever the annual rebates and all which are there, we accrue on quarterly basis on a projected lifting of the volume. So we usually take it on every monthly, quarterly basis in our accounting.
Kirtan Mehta
Sure, sir. Thanks for this color.
Manish Gangwal
Thank you thank you.
Operator
The next question is from the line of Yogesh Patil from Dolat Capital. Please go-ahead.
Yogesh Patil
Thanks for taking my questions and congratulations for the good set of numbers. Sir, Indian refiners are expanding our capacities and we hope they will also be building the waste oil production capacity-based on the market demand. Will it help us in terms of pricing to procure base oil from domestic refiners instead of import? And that will improve any gross margins in the long-run, we wanted to understand on this side?
Ravi Chawla
So even currently we buy base oil from the local refiners, of course, the proportion — the proportion is slightly lower. But these Indian national oil companies, when they sell office base oil prices, they consider both global base oil prices and the rupee-dollar ratio. So from that perspective, the overall pricing has always been based on the global considerations and rupee-dollar. So while we obviously wait for the capacities to come up, it can definitely help us in reducing our — some of the working capital cycles because when it is imported, we need to store or place orders for sometimes 60, 75 days in advance but if it is locally available in a sufficient requirement quantity, then some of the working capital cycles can improve and pricing, of course, we’ll have to wait what they calibrate to.
Yogesh Patil
But sir, also our transportation cost will also come down if I’m not wrong. I’m just wanted to correct myself.
Ravi Chawla
Everybody honestly, so all of them, when they announced their price lift now also, they factor-in the global transportation, the sea freight and the landed cost alternatively available to the buyers here and Accordingly calibrate their pricing as I understand.
Yogesh Patil
Okay. So sir, my next question is on capital expenditure. If you could provide us more details on the capital expenditure plans for next year and if you could elaborate more on the details on the spending side, a project-wise.
Manish Gangwal
So our trajectory of capex has been around INR30 crores annually. And going-forward, we are going to as you know, have a capex of around INR30 crore to INR40 crore is what is our estimate. Of course, we are running our plant at around 100% capacity and we have purchased some land — a joining land near our Silvasa plant as well, which is connected to our plant. So we look for a sort of expansion plan there as well. And once some sort of crystallization happens there, we will obviously announce it to all of you. But at this stage, this is under discussion stage. But overall, the general capex will be in the range of range of around INR30 crore to INR40 crores.
Yogesh Patil
Sir, as you mentioned, our current capacities are running closer to 100% utilization level. Can we fetch it to, 110, 120 or do we need to expand our capacity if the demand continues at the rate of double-digit for the?
Manish Gangwal
So when we announce our capacity, it is the blending capacity which is on two-shift basis and we can always do a third shift and manage the requirements for the next one to two years of growth by running. And obviously we keep adding the other infrastructure and filling line and that’s where these capex goes annually. But overall, blending wise, we have sufficient capacity even for the next two to three years as well.
Yogesh Patil
And sir, last one from my side. As you mentioned, the MCU volume growth was double-digit. Is it because of festival season merge in all quarter third FY ’24 or is there any reason such as a good — for the good growth?
Ravi Chawla
And no see the demand conditions will vary. It is also based on initiatives. Of course, we see a different segments respond like agriculture is a seasonal, depends on how much is being used attractor. Similarly, I would say there is no great predictability that it will go up because of festival season. But yes, the demand did go up. We had a lot of initiatives and overall, we saw good buoyancy for our products. So it will vary. There is no real fixed kind of seasonability.
And also as this year you have seen elections, you have seen so many state and central elections. A lot of the projects got delayed, lot of movement was there, there was a cold-weather, hot weather. So a lot of things is there, but there is no real evidence that because of the festivals and then motorcycle demand will go up. It’s more something you have to calibrate based on-demand. Yes, monsoon season tends to be low for some segments because the usage is less, but otherwise it’s quite active demand.
Yogesh Patil
Thanks. Thanks a lot, sir. That was really helpful. T
Ravi Chawla
Thank you.
Operator
Thank you. A reminder to all participants to ask a question, you may press star and one. The next question is from the line of Chirag from Capital. Please go-ahead.
Chirag Fialoke
Thank you for the opportunity. Just wanted to understand for this quarter, the difference between the standalone — the minor difference between standalone consolidated numbers are because of tariffs, right? Is that right?
Manish Gangwal
Yes.
Chirag Fialoke
But then I think in the footnote, it feels like the tariffs this quarter probably brokeven or is almost at a profit. Is that right or am I reading something wrong?
Manish Gangwal
No, no, you are right. So they were almost at EBITDA breakeven for the quarter.
Chirag Fialoke
So this quarter they have reached big, but our consol number is still lower than our standalone number.
Manish Gangwal
That is mainly because of the depreciation which is there.
Chirag Fialoke
Okay. Understood. Understood. Understood. Okay. Fair enough, sir. And the second question just on the continuity of the previous participant. We — when we have the ability to run the third shift, that would allow us to do almost 20% 30% more volumes than we are doing. If we were to run the full third shift, is that correct or is there a limitation there that we don’t understand?
Manish Gangwal
So we are already running some sort of a third shift for some days during the month. And so what we are trying to recalibrate is that we don’t want to run all the plants at full third ship capacity around the — around the year. So obviously, we will be looking at some sort of expansion, but that is not yet fully crystallized.
Ravi Chawla
So as this — as the product requirement goes up, there is filling lines which go size-wise. There is a space required for packaging. There is other activities which have to be pipeline made. So as we grow, obviously, we have to look at — that’s why we acquired some more land in Silvasa. Chennai, we have space as of now. Silvasa will be doing some things, as Manish mentioned, even on the capex once we are clear about the plans because pack-wise, you have to create capacity, drop on drums to small packs.
Chirag Fialoke
Understood. So you’re saying it’s largely like a space requirement for the SKU with? Yeah. Okay, understood. And that —
Ravi Chawla
Yeah. Sorry, go-ahead. Sorry, go-ahead,
Chirag Fialoke
Just — and the third shift, suppose we were to run it on a regular basis for say half the month, every month or something like that, that doesn’t incur any incremental one-time costs or anything, that’s nothing that would sort of show-up in the numbers in 1/4 or something other. That’s not something that would be expected, right? Because it’s just a continuation of the second shift. I’m just guessing if there is a hiring of more labor or something which is involved, which involves a one-time cost also on a basis.
Manish Gangwal
The number would not be any material to be discussed here.
Chirag Fialoke
Understood. Perfect. Thank you. Thank you, sir. Thank you for the opportunity. Congratulations for a great set of numbers.
Manish Gangwal
Thank you.
Operator
Thank you. Thank you. The next question is from the line of Ketan Mehta from Baroda BNP Paribas Mutual Fund. Please go-ahead.
Kirtan Mehta
Thanks for another opportunity, sir. In terms of the expansion at Salvasa that we are looking at, what kind of capex could be involved when we are looking at expansion of line and what kind of line size, I mean, some broad color in terms of what we are considering there?
Manish Gangwal
Yeah. So we are — as I mentioned, we are looking at the plant right now. And based on that we will — once we firm up the plants, we will obviously come back and announce. What’s our current size? We have 90,000 tonnes capacity today in Silvasa plant and Chennai plant is 50,000.
Kirtan Mehta
And what’s the typical module of addition when we are considering the addition?
Manish Gangwal
Yeah. So as I mentioned, we have not yet pumped up the plant. So we’ll have to really work-out on the basis of the requirements and the pack-wise requirements as Ravi highlighted. And based on that, we’ll have to really do a detailed exercise and then we’ll be able to firm up.
Kirtan Mehta
Sure, sir. Thank you.
Operator
Thank you. The next question is from the line of Harsh Maru from Emkay Global. Please go-ahead. Yeah. Thank you, sir.
Harsh Maru
So my question actually relates to the battery segment. So could you share some bit of financial metric around the battery segment for the three months and the nine months of this fiscal? And also if you could talk about the localization initiatives that you were I think, undertaking over here.
Manish Gangwal
So battery business, as we have been highlighting is clocking around INR20 crore quarterly revenues, INR20 crores to INR25 crore range and have turned EBITDA-positive during the current year. They were earlier marginally negative, but now this — for this year they are at EBITDA-positive. Overall localization, we have been able to successfully localize one major SKU and the work is on for more SKUs to be localized.
Harsh Maru
Right, right. Thank you, sir. And secondly, in terms of the additives, so couple of things. One, do you see the overall composition of additives in your total inputs increasing and if you could throw some light on the pricing trends around additives.
Ravi Chawla
So see, normally additives are 10% to 15% of the — what we make the lubricant. So that varies, of course, on the quality of the additive and the percentage dosing. So this is a raw-material component in all the lubricants. Some products have lesser percentage. So I think this is something which is normally done. We also have a global procurement strategy for additives, which we do globally with all the four major additive suppliers. So that continues to be the part of the cost building on the — and we continue to also work with additive companies for higher technology products and new products. So basically, the pricing is quite well set-in terms of our global procurement.
Harsh Maru
Right. Okay. Thank you so much.
Ravi Chawla
Thank you.
Operator
Thank you. The next question is from the line of Pratik Dedia, an Individual investor. Please go-ahead. MR., your line is. Please go-ahead with your question.
Pratik Dedhia
Am I audible?
Operator
Yes, sir.
Pratik Dedhia
Yeah, I wanted to check, you mentioned that you will be doubling your revenue Over the previous year. Is that correct?
Manish Gangwal
So we mentioned that we will be doubling our revenue for Tyrex business, which is our DC fast charger subsidiary in that business, yes.
Pratik Dedhia
Okay, got it. And the other thing I wanted to check, how are you seeing the data center business and what kind of volumes you are doing or what kind of traction are you getting there?
Ravi Chawla
Yeah. So data center, as we have got our data as you use our data is the total lubricant market is today 2,900 million liters. If you take-away process oils in India, it’s around 2,000 liters. If the entire data centers, which today are not emersion cooling, they are cooled with air-cooled. If we were to just take a simple assumption that everything gets converted, which will not happen. So given the potential that if everything gets converted because it’s very expensive to go into the emersion cooling, it’s a technology which is new. Today, there is hardly any.
So if we take a very, very simplistic assumption and says that everything gets converted, our assumption for Indian market is that this will require 14 million liters against the market size of 2,000 liters, not even 1%. Now at the 1% level, we are getting our products ready. Globally, we have a product technology team that’s working on that. So once the products are ready in a few quarters, we’ll be able to place it with some of the data centers who will go for immersion cooling because immersion cooling, the high-level of — now the chips are going to get much faster, the requirements of data is going to go very-high.
So we will be in a position to do these trials and hopefully test this segment. It’s a good segment globally and definitely, we are also looking at globally. But in India, the context is that how much will get converted. So we will be in a state of readiness in a couple of quarters to be able to work-in this segment. And hopefully, you will see a lot of large data centers coming. You know there are certain cities in India, which are you definitely gunning for this couple of cities all mentioned. So this is actually a — definitely futuristic product, which we are preparing for.
Pratik Dedhia
Okay. Got it. All right. Fair enough. And in terms of your margins so just checking historically, 13% 14% is kind of a peak margin that you achieved. So how do you see traction going ahead? I don’t want the guidance to it, but some ballpark or some guidance to it, will you be able to maintain, improve? How do you see that?
Manish Gangwal
So as we mentioned, we continue to track 12% to 14% EBITDA margin, which is our current guided band. And in one of the previous questions, we mentioned that obviously our — we aspire to move to the higher trajectory over a period of next two, three years. Every two, three years, you would like to move to the higher bands and the premiumization efforts, the Unlock 2.0 strategy theme which we unveiled some last year is on-the-go and every segment is looking for premiumization of the product and focusing more on selling better products, higher-margin products, as Ravi highlighted earlier.
So with that, the trajectory is always to look for the higher bend, but it will not happen in 1/4 or two quarters, it will be over a period of two to three years is what we are aiming at. And also our strategy to continue to grow volumes towards the market remains and that’s where the operating leverage also keeps coming in and will also help achieve that.
Pratik Dedhia
All right. Got it. Thank you.
Ravi Chawla
Thank you.
Manish Gangwal
Thank you.
Operator
Thank you. A reminder to all participants to ask a question, you may press star and one. The next question is from the line of Hardik from ICICI Securities. Please go-ahead.
Hardik
Sir, any price hikes have we taken in this quarter or in this financial year and to what extent?
Manish Gangwal
So that we have already answered in our earlier one of one of the investors questioned about that we are looking at the rupee depreciation and the impact on the input costs, while crude has come off the highs and it is positive overall to maintain some of the stability. Base oil impact has been minimal of the crude movement and oil has been stable. We are not seeing any major changes in base oil as of now, but rupee impacts the landed cost and we will definitely look at margin management and recalibrate our pricing.
Currently, you know, it’s — the entire rupee depreciation has accentuated in the last fortnight or so, I would say and obviously, we are closely watching that. We will definitely take some actions if required on the margin management side.
Hardik
Yeah. It’s not about the price hike that will be taken. I’m just asking about, have we taken any price hike in past in this financial year?
Manish Gangwal
So if we recall, I think there was only one price increase in April-May quarter one and thereafter there have been no price increase because rupee and base oil have been very stable.
Hardik
And to what exchange was it? 1%, 2%?
Manish Gangwal
It was around 2% at that time if we recall correctly at this moment.
Hardik
Yeah. Okay. That’s helpful. Thank you.
Operator
Thank you. Ladies and gentlemen, to ask a question, you may press R&1. The next question is from the line of Nisha Mulchandani, an Individual Investor. Please go-ahead. Hi, am I audible? Yes, ma’am. Please proceed.
Nisha Mulchandrani
Thank you. Sorry if I’m repeating this question again, but what is the amount of battery turnover in this quarter?
Manish Gangwal
And yes. Nishab, it was around INR21 crore for the quarter to be very specific.
Nisha Mulchandrani
Okay. And is there any increment into the export percentage? What is the range on the total revenue that we have exports in this quarter?
Manish Gangwal
Exports are growing well for us, but they are still not — they are still single-digit of our overall volumes.
Nisha Mulchandrani
And that would be a higher single-digit like as mentioned in the last quarters in this report.
Manish Gangwal
We will not be able to give that specific number, Nishan, you will appreciate that.
Nisha Mulchandrani
Okay. Okay. And in terms of the subsidiaries that that we have, is there any major improvement into the next year that we see, like we see that there is a 300% growth. So any major improvement that we can see into the next quarter as well or any major plans for that?
Manish Gangwal
So you are talking of the quarter or for the next year? I’m not clear.
Nisha Mulchandrani
For the next year. Like given the kind of growth it is showing, so is there any substantial improvement that has been planned for the next year as well?
Manish Gangwal
So our aim for the direct business, it is a DC fast charger business, of course, depends on the EV penetration and the overall government impetus on the EV charging side of the infrastructure. But yeah, we want to definitely take that at a rapid pace over the next few years in terms of our aspiration on the revenue side.
Nisha Mulchandrani
Okay, sir. Okay, thank you. That helps.
Manish Gangwal
Thank you.
Operator
Thank you. A reminder to all participants to ask a question you may press thank you. As there are no further questions, I would now like to hand the conference over to the management for closing comments.
Ravi Chawla
Thank you very much. Yeah. Thank you. We’d like to, of course thank everybody for being on the call. And of course, we’ll try to answer the questions the best of our ability. Our outlook and focus remains on both strategically and also in terms of our executions to deliver consistent two to three times of the market growth, which we anticipate is around 3%. Of course, continue our profitability band of 12% to 14%. And of course, volume-led growth, which is profitable in our core lubricant business is our focus. While we also strengthen the EV charging segment to become a growing contributor to our vision, both in the medium and long-term. So looking ahead, we are optimistic that about the improving demand conditions that we are seeing both in B2B, B2C. And definitely, we have started seeing some early signs of demand recovery because it has been slightly challenging in the last few quarters.
As we see the announcement on the middle-class income getting expanded, the uptick in government capex and infrastructure, this of course goes well for our segment-wise growth. Our focus remains on strengthening our brand, enhancing the customer experience, increasing our conversion, empowering people obviously and to drive sustainable growth.
And definitely, we are continuing to do that, focusing also on our theme of Unlock 2.0, which is to accelerate, premiumize and transform. We are investing a lot in digital and hopefully, we are going to see a lot of you know good initiatives in terms. And I’d like to also end by mentioning that we have declared a very good return to our shareholders in terms of an interim dividend of INR20 per share, which is INR1,000 percentage on the face value of INR2 and look-forward to chatting with all of you in the next call. Thank you so much. All the best.
Operator
Thank you. On behalf of Gulf Oil Lubricants India Limited, that concludes this conference. Thank you for joining Us and you may now disconnect your lines