Kiri Industries Limited (NSE: KIRIINDUS) Q1 2026 Earnings Call dated Aug. 11, 2025
Corporate Participants:
Unidentified Speaker
Manish Kiri — Executive Chairman of the Board, Managing Director
Analysts:
Unidentified Participant
Nupur Jainkunia — Analyst
Yash Dantewadia — Analyst
Vivek Joshi — Analyst
Manoj Kumar Bhura — Analyst
Nandan Ganatra — Analyst
Jay Kataria — Analyst
Presentation:
operator
It. It. SA. Foreign. Ladies and gentlemen, good day and welcome to Kiri Industries Limited Q1FY26 earnings conference call hosted by Velorem Advisors. 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 touchstone port. Please note that this conference is being recorded. I now hand the conference over to Mr. Nupur Jain Kunia from Valorum Advisors. Thank you. And over to you ma’. Am.
Nupur Jainkunia — Analyst
Thank you. Good evening everyone and a warm welcome to you all. My name is Nupur Jen Kunya from Valorum Advisors. Welcome. We represent the investor relations of Kiri Industries Ltd. On behalf of the company, I would like to thank you all for participating in the company’s earnings conference call for the first quarter of the financial year 2026. Before we begin, I would like to mention a short cautionary statement. Some of the statements made in today’s earnings call may be forward looking in nature. Such forward looking statements are subject to risks and uncertainties which could cause actual results to differ from those anticipated. Such statements are based on management’s beliefs as well as assumptions made by the information currently available to the management.
Audiences are cautioned not to place any undue reliance on these forward looking statements in making any investment decisions. The purpose of today’s earnings call is purely to educate and bring awareness about the company’s fundamental business and financial quarter under review. I would now like to introduce you to the management participating with us in the conference call. We have with us Mr. Manish Kiri, Chairman and Managing Director. Mr. Jayesh Irani, Senior Manager, Accounts and Finance. Mr. Suresh Kundalia, Company Secretary. I would now request Mr. Manish Kiri to give his opening remarks. Thank you. And over to you, sir.
Manish Kiri — Executive Chairman of the Board, Managing Director
Good evening everyone and welcome to the earnings conference call for the first quarter of the financial year 2020. I will begin with a brief overview of our quarter one performance followed by key operational highlights and strategic updates on a standalone basis. In the first quarter of financial year 2026, revenue from operations stood at 181 crores reflecting an 8% year on year growth. At the EBITDA level, the company recorded profit of 17.3 crores, a beta compared to a beta of 13.6 crores in the same quarter of the previous year. During the quarter, the company reported a. Profit after tax of 7.2 crores, a significant improvement from loss of 1.7 crores in Quarter 1 25. This was primarily due to dividend received. From Longson Keely contributing notably to its other income. On a consolidated basis, the revenue from operations for the first quarter stood at 202 crores, a growth of about 10% year on year basis. At the ABEDA level, the company recorded a profit of 18.6 crores compared to EBITDA of 14.3 crores in the same quarter of the previous year. Net loss for the quarter before accounting for the share of profit from associates and joint venture stood at 51.4 crore compared to the net loss of 1.1 crore in Quarter 1 FY25. During the quarter, share of profit of associates and joint venture reported as 61.54 crores.
On the operational front in Quarter 126. FY26 the dies and dyes intermediate industry continued to face headwinds particularly in reactivized vinyl sulfone and H acid due to raw materials volatility, especially fluctuating in caustic soda flakes, nitric acid, G acid, Tobias acid and many other intermediate prices. While export volumes of reactive dyes improved significantly driven by recovering global textile demand and lower freight cost, vinyl sulfone and hses remain under pressure. Despite these industry challenges, Erie Industries Limited demonstrated operational resilience. By maintaining a strong. Focus on its core business segments, liquidity management and capital structure. The company continued its efforts in optimizing the product mix, rationalizing cost and enhancing internal efficiencies, staying committed to long term value creation even amid ongoing macroeconomic pressures with regards to the DI Star case. Following a February 23, 2024 order by the Singapore International Commercial Court for an en bloc sale of Dystar shares held by Kiri Industries Limited and Sendai International Capital Limited Court appointed receivers and Kiri Industries have executed a self purchase agreement with Zhejiang Longshan Co. Ltd. On May 29, 2025 under the SPA, the purchaser will acquire 26 lakhs 23,354 shares of the company of the company held by Kiri in Diastar representing 37.57% of its paid up share capital for a base consideration of $676 million.
An additional 20.29 million will be paid. To cover any shortfall or obligations under the sba. The final transaction value is subject to adjustments as per the agreement. The total amount is $696 million to be paid to Gary. The deal is contingent on customary closing conditions and regulatory approvals. The long stop date for meeting all conditions is 10-02-2025 extendable to November 3, 2025 if agreed by the parties. With that, we can now begin the question and answer session. Thank you.
Questions and Answers:
operator
Thank you very much. We will now begin with the question and answer session. Anyone who says to ask a question, you press star and one on the Touchstone phone. If you wish to remove yourself from the question queue, you may press star and 2. 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 comes from the line of Yash dantevadia from Dante Equity. Please go ahead. Yes, you can proceed, sir. Mr. Yes, your line has been unmuted. Please go ahead.
As there is no response from the current participants, we will move towards the next question. The next question comes from the line of Vignesh Iyer from Sequent Investments. Please go ahead.
Unidentified Participant
Thank you for the opportunity, sir. Wanted to understand how, what is the legal fees that we paid in this quarter?
Manish Kiri
You are referring to the legal cost for Singapore case.
Unidentified Participant
Yes. Yes. Right.
Manish Kiri
So all put together including cost and. Expenses is somewhere around 7 crores. So we paid around 7 crores this quarter, right? In the quarter. Correct. Which is, which is relatively lesser than the average quarter. So it’s, it’s, it, it is going down now.
Unidentified Participant
Right? And I mean all this legal cost would be recoverable as part of the deal, right?
Manish Kiri
No, the, the, the legal cost which has been awarded to us already will be paid to us which is part of the recovery that we are getting, part of the amount which has been crystallized. But the cost which we are incurring. For the receiver because this also includes the cost that we are paying to. The receiver right now in addition to. The legal cost, these numbers include the receiver’s payment cost. And all that receiver’s cost is going to come back to us along with interest at 5.33%. So all the receiver’s cost is going. To come back to us, paid back to us.
Unidentified Participant
Okay. Okay. And, and as currently, you know, the Internet play, I mean as increased to 60 crore in this quarter, visa based, 54 crore that we, you know, paid last quarter. So what is the exact cost of borrowings that we are incurring behind this advance that we have received? I mean borrowing that we have taken.
Manish Kiri
The interest which you see in the consolidated numbers, right. Is the interest which has not been paid but which is accrued on the account of the project loan and the. Advances that we have taken. Against the judgment order. So the judgment funding which we took about $130 million which is being infused. In the project, that interest is being. Accrued and the interest along with the principal would be paid as and when. Diastar sale process is realized. If diastar sales process is realized. So it is mainly on the account. Of the advance that we have received. For the new project and which is not to do with the operations of. The current business which is for the copper, copper project that we are, we are implementing right now.
Unidentified Participant
I mean it would be payable, right? It has accrued just that our cash outflow has not happened. But once Daiso money comes in, we have to pay this interest, right?
Manish Kiri
Yes. Yes, correct. Yes, correct. So it will be, it will be. Paid when Daisar proceeds are received.
Unidentified Participant
Okay. And could you please give a brief about what is the status of corporate budget about the team that has been put in, you know, you know, for the operation and management of the project to, you know, to make it ready for operations. And if you also could share a timeline like when would we, you know, the same team can be also part of the call where we can interact with the team.
Manish Kiri
Right. There are significant progresses which has happened. And I will just briefly highlight to you without going into much detail. Number one, the project implementation is on the track. You know, the technology supply agreements have been executed. The project work has already commenced at the site. Orders are being placed to the vendors, to various vendors and various vendors are being now scrutinized and screened and selected. In addition to that, we have significantly also strengthened the team of the project. So there are many heads have joined in a senior team and the total team has now increased to almost 25 people.
And I think by this quarter there will be further addition. So the team will increase to at least 40 to 50 people. And this is the project execution team. So it’s strengthening quarter on quarter at some point in time. Yes, as we mentioned earlier, there will be senior management team who would come to answer your questions. And in 2026 onwards we will implement that when we see a significant headway, when we see that the majority orders are placed and we are in a full phase of, you know, of having proper and executed timeline definitely will be updated by the responsible people of corporate project.
Unidentified Participant
Okay, thank you, sir. That’s all from us.
operator
Thank you. The next question comes from the line of Vivek Joshi from Bandar PUJ Capital. Please go ahead.
Vivek Joshi
Yeah. Am I audible, sir?
Manish Kiri
Yes, go ahead please.
Vivek Joshi
Yeah. I have two questions. One on the balance sheet we have 192 crores that we have given to somebody which was not there in 23 and 24. So whom is that being loan given to?
Manish Kiri
There is no such loan given to any external party. No. But it’s on the consolidated balance sheet. So it has to be an external party. So it must be within the. It is within the group. It is within the group company. So Indonesia Copper, Kiri Industries limited Between the two entities. It is inter company. But it won’t come on the consolidated effort with intercompany search. It is. There’s a loan lying on the consolidated balance sheet in the presentation.
Vivek Joshi
Loans.
Manish Kiri
You mean the. You mean the advances given the loan. Given to someone or you are talking about the company? No, the advance is given that you have loaned somebody. It’s not there, I think.
Vivek Joshi
Can you please send an email clarifying this? Because it’s not there. The advances and the loans are within the group companies.
Manish Kiri
There is nothing beyond group company. Okay, I’ll send an email. My second question is can you give a capital allocated in the copper project in debt and equity currently? Because there’s no mention. So it’s quite disturbing. Do not have any mention of copper budget in your press release. In your presentation. It’s as if it just vanished. So I mean if you can just keep updating on what’s happening in the corporate budget, it will be sure we’ll. Be pleased to do so. We’ll be pleased to do so. And if that is your suggestion, we will add at least one or two pages in our quarterly. Quarterly management note. We’ll be pleased to do so. There is the. Right now whatever we are infusing in the corporate project is only equity. Right. And equity is being infused in Indonesia Copper Ltd. Which is. Which is. You know, which has been received from Singapore borrowings. Correct. So right now the equity which has been few infused. There is no debt which has been. Which has been infused as of yet. And equity that we are. We are infusing to the extent of $130 million which is close to 1100 crore, has not been fully exhausted yet. We still continue to deploy that funds and that deployment would continue till the. End of the year till we receive Singapore sales proceeds, the final sales proceeds from Daistar. So everything is being infused as equity. But point well taken. And we will give you the numbers and we will give you how much. Has been infused as an equity till date.
Vivek Joshi
Okay, thank you.
operator
Thank you. The next question comes from the line of Manoj Kumar Ghora from Adinath Financial Service Private Limited. Please go ahead.
Manoj Kumar Bhura
Good afternoon, Maniji. Good afternoon. Yeah, my question was regarding various visits you have undertaken you have gone to Odisha signed MoU with Odisha Chief Minister. You have gone to Brazil with the Prime Minister’s business delegation. You have incorporated a new company in China. You have incorporated new company in Cabin Island. We have a subsidiary company in Singapore. So many actions are being taken. Yeah. Can you throw some light on all. These things you should be happy about? So I absolutely, absolutely feel that Manish Bhai is moving around the world.
Manish Kiri
Right. So see the Brazil visit was a part of the BRICS delegation where I. Was participating along with our official delegation which went to Brazil and it was. More of representing the country. But as you are aware, our team also had lot of meetings and visits. In addition to Brazil with Chile and. Peru where the copper ore and copper. Concentrate activities are going on. So the visit was part of the representing country along with the team of our Prime Minister. At the same time the team was. Also busy exploring the sourcing activities in South America. So that was that visit about Odisha. Has been a quantity quite a good opportunity which the company has been exploring. Nothing has been finalized yet. But looking at several opportunities. And the. Odisha government’s incentive schemes, it appears that there might be some viable project in. Another three to five years which may be able to explore there. So we are trying to, we are. Trying to explore certain opportunities in Odisha. Again which is part of the Invest Odisha or Utkars Odisha which they have started the campaign for. Number two, number three. You know, recently I was also part of the, you know, the delegates for. The visit of President. You know, President. Right, right, right. Philippines. Philippines. Philippines President who visited here and we had a very high level meeting with. Them and we have signed an MOU with Philippines in presence of Philippines President. Participating in investing into mine a copper. Mine along with the government and to sign an offtake agreement to purchase copper ore for our copper plant in India. Right. So again it is part of our entering into and securing our feedstock. Philippines is world’s fourth largest copper reserve and we are making our efforts to secure certain quantity of feedstock from Philippines. So it was part of the discussion with the President and we were fortunate and lucky enough to have one on one meeting with the President and his. Team and we could conclude certain, you know, certain future interest with them. Again, once the definitive agreements are signed, once we are able to execute the. Intentions that we have agreed upon, we will make the announcement when the things become concrete and the official agreements are. So these are the part of activities. Which which include representing country, which includes our interest in copper project and the feedstock and which also Includes the future opportunities.
Manoj Kumar Bhura
And Manish, by regarding this, the money which we will be receiving very shortly, do you plan to have some chief investment officer for your company to take care of the money? It is a very highly specialized job.
Manish Kiri
Right. So we. We don’t need to have chief investment officer, but we have formed a committee which is the investment committee at the board level. Correct. And we have recently hired a chief financial controller because certain investments and the decisions will be taken by the board. And out of these funds which we. Are receiving post tax, half of it is going to go as an equity into copper project. So half of these sales proceeds is already committed as an equity for the future project. So remaining half, we will have more. To decide in time to come. But there is no hurry to make. A decision for the deployment of those funds. And regarding financial closure for this corporate project, how far we have gone, what is the status of that? It is in process right now and we have several in principle approvals received. And we still hope that by December or before December we will have complete financial closure. By the time the equity is realized. The debt would also be tied up. And the current business of our dying business. I have seen that Longson and KIRI is doing wonderfully. But KIRI is just lagging behind. What is the reason and how do we propose to alleviate all those things and correct these things? See, you will. You will have to look at the things in totality. Okay. In the sense there are two factors. That that you must analyze when you. Look at our financials. One, KIRI produces not only dyes but. Intermediates and basic chemicals. Correct. And those intermediates and basic chemicals are supplied to Longshain Kiri. And where the JB Longsheen Kiri produces finished products and sells so finished products margin is captured to the profit of Longsheen Kiri into Kiri. So you have two layers. So one layer is going from KIRI to Longsheen Kiri. And when the finished products are sold from Longsheen Kiri to the external customers, that is where the part of margin is captured. And that is what you see in the consolidated numbers. So when you look at the consolidated numbers, it’s a correct picture where the capped where we capture the dyes margins.
Of Kiri integrated dyes margin as well. As integrated dyes margins for the sale of dyes of the intermediates of Kiri. Taking place through Longshin Kiri. Number two, there are certain chemistries and certain specialty products that is being produced and sold from Longsheen Kiri which is not being Produced and sold at Kiri. So there is a difference in product portfolio. For example, Longsheen Kiri is the only. Has the only indigo manufacturing facility in India. The only plant which produces indigo in India. So it has certain advantage. Similarly it produces products with fluorochemistry which Kiri doesn’t. Again, that is a differentiated product that. The highest end products and that is where the higher margins are being captured. So these are the two factors. When you look at the, you know. The differences between Kiri and Longshan Kiri. Then going forward, what is our expectation of Kiri standalone? Kiri standalone. The moment the legal and the receiver cost is going to go away, you. Will see profit after tax also. You will see positive on that side. And Kiri has been also facing challenges. In terms of capacity utilization. Our capacity utilization has been almost 48% in this quarter. And that is the challenging part because we are having too much of capacities not being able to. To fill for almost three years now. So we are trying to change product mix. We are seeing what more products can be added. And the challenges on textile sector has been percolated into challenges for the dye sector. And that is where we see the. Shrinkage and the reduction of margin. We are not able to earn enough. The major factor in the lower capacity utilization and also the burden on legal cost. So these are the two factors. Once we try to address one of. Them, you will see improvement in the margins.
Manoj Kumar Bhura
Thank you Manish bhai for answering all my questions.
Manish Kiri
Thank you. You’re welcome.
operator
Thank you. Before we take the next question we would like to remind participants. You may press star and one to ask question. The next question comes from the line of Nandanganatra from Delta. Please go ahead.
Nandan Ganatra
Hello sir. Am I audible?
operator
Yes. Yes, go ahead please.
Nandan Ganatra
My question is. Sir, on the last quarter we have given guidance in our existing diet business as 1500 crore top line. So do we maintain this guidance?
Manish Kiri
No, I think it’s. It’s. Currently we taper down. We reduce our forecast. In fact. Yeah. And I’ll give you the revised forecast. Where we are trying to. So we are not maintaining that currently. Because the headwind is still continuing and we see the challenges continuing even the rest of the year. So we would revise it on a. Standalone basis to be close to 800 to 900 crore and on consolidated basis. Right around 1200 to 1300 crores. So there is at least. At least 20% reduction in the forecast that we were trying to achieve earlier.
Nandan Ganatra
Okay. Okay. Okay. Thank you very much for the answer. Thank you.
operator
Thank You. The next question comes from Darayana Funkit from Fusion Capital. Please go ahead.
Unidentified Participant
Yeah, hi, I’m Audi Godhy.
Manish Kiri
Yes, go ahead.
Unidentified Participant
My question is on the our En Bloc sale for Die Star. So as previously discussed, we were on track on 2nd of October, right? So can you throw some light where are we now and on track or not?
Manish Kiri
So that is still fully on track. And. And Longshan is in the process of. Complying with the condition president before closing. And those conditions which they had mentioned in self purchase agreement. What we have been informed they are. Trying their best to get mainly the. Regulatory approvals from the Chinese government and. Which is on track. As far as what we understand the. Receiver has been closely following up and there is a close communication and submission of lot of information data going on. Between the longstand and the receiver which. We are not privy to. But as far as the message that we receive is that the, you know, the approval process is on track and October 2nd is a firm date in. Which they should be honoring. And if not then the next tenable long stop date is November 3rd and November 3rd. Third would be the full and the final date. So hopefully between October 2nd and November. November 3rd we should get this concluded.
Unidentified Participant
Okay. And here, this is a deal completion date, right. So receiving the cash would need some additional days or is it the same?
Manish Kiri
No, no, it’s the same day. The. The. The deal is not complete unless and. Until we receive money. Correct. So it’s the date on which the. Money is transferred to the escrow account of the receiver. So the date, you know, and then the exchange of shares and the cash will take place. But it is the date on which. Longchain fully paid 100% payment has been made. That is the date on which the completion date.
Unidentified Participant
Got it, Got it. Answer my small question. On our copper plant, so are we expecting some revenues in FY26 or we are starting off in FY27 somewhere?
Manish Kiri
27, you will expect revenue.
Unidentified Participant
Okay, got it. Great.
Manish Kiri
Partial revenue we will start expecting from FY27. And as I mentioned earlier, from next quarter onwards we will also keep giving. Updates in our management note every quarter. So you know the progress and the timeline and also key aspects of the project implementation we will try to highlight.
Unidentified Participant
All the way. Thank you. Thank you. Thank you.
operator
Thank you. The next question comes from the line of Vivek Joshi from Bandar Puch Capital. Please go ahead.
Vivek Joshi
Yeah, thank you for the opportunity again. So one question I had is if the finance was supposed to be the project, money was needed in branches Only then why was 1100 crores raised in one go and we are paying so much interest cost on that? That’s my one question. Was rain at one go? It was all in one go. No, but as of now, how much is unutilized so that we are paying high interest on that? That’s what I wanted.
Manish Kiri
Yeah.
Manish Kiri
More than half is unutilized.
Manish Kiri
Almost 600 crores is unutilized, actually.
Manish Kiri
Okay.
Unidentified Participant
And how much is the accrued interest which is not yet been paid on the balance sheet? I could not find that figures.
Manish Kiri
Accrued interest. The interest has not been paid at all. So whatever is accrued interest is not.
Manish Kiri
Not required to be paid because the.
Manish Kiri
Debt is not required to be serviced, you know, till the Diastar proceeds are received.
Unidentified Participant
No, no, I understand. But accrued interest in the liabilities, under which head has it been added? I could not find it. Like is it in the borrowings?
Manish Kiri
Only it’s been added.
Manish Kiri
One second. It is added to the borrowing.
Unidentified Participant
Okay. So as of now it’s 1143 consolidated is outstanding.
Manish Kiri
Yes.
Manish Kiri
Correct.
Manish Kiri
That is the outstanding. Exactly. Right.
Manish Kiri
Okay.
Unidentified Participant
Thank you so much.
operator
Thank you. The next question comes from the line of Sameer from Pure HR Global. Please go ahead.
operator
Yeah, My question is, suppose sender doesn’t get the approval from Chinese government, what happens?
Manish Kiri
Finally then, so then if.
Manish Kiri
If sender doesn’t get approved from the Chinese government and by October 2, if. If receiver sees that there is no power possibility or there is, you know, there is. There is no certainty.
Manish Kiri
Let me put it this way.
Manish Kiri
Then this will go to the second bidder.
operator
Okay. And is the second bit of the valuation being disclosed or in public knowledge?
Manish Kiri
No, that is not been disclosed. But what we understand from market knowledge.
Manish Kiri
It should be around $1.6 billion.
operator
Okay. And my last question is, suppose it has to go to the second bidder. Then it will probably take six months more.
Manish Kiri
No, then 31st of December is a long stop date.
Manish Kiri
So.
Manish Kiri
So the next bidder needs to complete.
Manish Kiri
Before 31st December 2025.
Manish Kiri
So I think the second bidder is also right now been kept into discussion by the receiver. It has not been deactivated.
operator
Okay, but they will be able to arrange such a big amount of funds in within a month. You mean to say.
Manish Kiri
So the funds and the proof of funds has already been, you know, been.
Manish Kiri
Confirmed by the receiver.
Manish Kiri
So access to funds and proof of funds for the second bidder is supposed to be already in place.
operator
Understood. Fine. Last question on this point.
Manish Kiri
It all depends on the second bidder’s regulatory requirement.
Manish Kiri
If there is any.
Manish Kiri
And if it is a. If, if it is a private equity.
Manish Kiri
Investor, it becomes easier rather than a strategic investor.
operator
Right, Right. And last question is, do you think by any chance Senda can object or not agree to have it sold to the second bidder?
Manish Kiri
No, no, it’s not possible at all because they have been given enough chance, they have been chosen as a preferred.
Manish Kiri
Bidder, they again defaulted which, and then.
Manish Kiri
There is nothing can be done. There’s no, there’s nothing they can do, nothing they can object.
operator
So by 31st December, you’re hopeful whoever first bit or second bit or whoever takes it, the deal should be done with by the 31st of December.
Manish Kiri
Exactly right.
operator
Thank you. Thank you so much.
operator
Thank you. The next question comes from the line of UN from ten AC Ventures. Please go ahead.
Manish Kiri
Yeah, so I just wanted to say that why is it that other mutual funds have not entered KD Industries specifically from India? And secondly, do you see it with the copper project in place, do you see this company becoming a three or four bagger in a few years even though you cannot specifically talk about how the share itself will go. But considering what you think will happen with the business in the future and why haven’t other mutual funds etc entered, what would you have to say on that?
Manish Kiri
Well, the. If you, you know, if you do.
Manish Kiri
Little bit research on the future projects.
Manish Kiri
And the revenue and the profits it can generate, where we are today and five years from now, the numbers would.
Manish Kiri
Be changed by multiple times. Right.
Manish Kiri
So the performance of the company, assuming.
Manish Kiri
That the project is implemented successfully, assuming.
Manish Kiri
That we are becoming operational by 20.
Manish Kiri
27, 28, which are the targets of the company, assuming that this happens, you.
Manish Kiri
Will see a vast change in terms.
Manish Kiri
Of its performance and numbers.
Manish Kiri
So that can correlate with the multiple times the value in it can reach compared to where it is today.
Manish Kiri
That’s the valuation part.
Manish Kiri
Now why the mutual funds are not.
Manish Kiri
Entering, we don’t have answer, to be honest with you.
Manish Kiri
Neither we have any knowledge or information.
Manish Kiri
Given by any mutual fund that why they are not investing in Kiri.
Manish Kiri
So it would be difficult for us to speculate on this that unless we have some information from any mutual fund.
Manish Kiri
Which we don’t at the moment, we do have inquiries from mutual fund time to time they ask us for a call or a meeting and we continue to make our efforts in that direction. So probably.
Manish Kiri
Whenever time comes and whenever.
Manish Kiri
Their criteria and their investment interest matures, they might invest, but it’s up to them.
Manish Kiri
Okay, and just the last question you set the guidance you were making it 20% lower. But do you expect this, do you expect this to change coming forward or for the next 12 months you see certain difficulties in the market because other chemical companies have.
Manish Kiri
Yeah, sorry, sorry.
Manish Kiri
The reason we have even a lower forecast is because, you know, we have taken into consideration several factors. One is I say the challenges in.
Manish Kiri
The demand and the challenges of textile sectors are continuing.
Manish Kiri
Number two, with the recent tariffs which.
Manish Kiri
We have now faced from the US.
Manish Kiri
We see that the would be some realignment in terms of exports of dyes from India. Certain countries would become more prominent where the duties and the tariffs are lower and the business will shift from some.
Manish Kiri
Countries to the other.
Manish Kiri
And that realignment is also going to.
Manish Kiri
Take at least couple of quarters and.
Manish Kiri
Eventually the quantum and the size of requirements because US is not processing any.
Manish Kiri
Textiles, leather or to a large extent much paper also.
Manish Kiri
So usage of dyes is vastly. In other countries, it’s only a matter of realignment of where the export is.
Manish Kiri
Increasing and where the export is reducing.
Manish Kiri
That realignment might take another six months. So the realignment as well as the lower demand both put together, we have given 20% lower forecast, but we don’t.
Manish Kiri
See it is, you know, it would be changed for the rest of the year.
Manish Kiri
Thank you. And just one final thing. There was talks of a fertilizer plant as well. Is this along with the copper plant or could that be. Could that begin earlier?
Manish Kiri
It is along with the copper plant.
Manish Kiri
It’S a byproduct of copper production. So copper smelting produces sulfuric acid which is converted into. Into phosphoric acid and then from phosphoric.
Manish Kiri
Acid to phosphoric fertilizers.
Manish Kiri
So it is, it is part of the integrated facility for manufacturing copper and fertilizer both.
Manish Kiri
Okay. And just a final thing, there was some. You are. Even though the long stop date is the end of the year, but as far as from market knowledge, you know the deal should be done by October, right?
Manish Kiri
Yeah, it should be done by October. We all expect that. And looking at the things which are going on track, we haven’t seen any hiccup yet. And we have been given repeated confidence.
Manish Kiri
By the receiver that the deal is going to get concluded it by October 2nd. So let’s hope so.
Manish Kiri
And there was some news in the. This thing about a prior CEO of the copper unit hood who’d made some drastic claims against Kiri. Could you shed some light on that? Because I think that had. Yeah, yeah.
Manish Kiri
So I think if you look at the filings of the company to ROC and there are certain legal notices issued to him. And the reason we had to fire.
Manish Kiri
Him, his name was Sanjay Sarkar and.
Manish Kiri
Terminate him was the integrity issue number one. Number two, mismanagement and misconduct number three, misguiding the core management team and not being able to handle the complex situations related to the project. So these are the factors and integrity.
Manish Kiri
Was one of the main factors.
Manish Kiri
And there were certain, there were certain.
Manish Kiri
Incidents which, which happened, which you know.
Manish Kiri
Which was discussed at the, at the board of Indonesia Copper limited And the board unanimously decided to terminate him. So he was also a board member.
Manish Kiri
As well as the CEO.
Manish Kiri
So not only he was fired as a CEO, he was immediately terminated by calling the board meeting.
Manish Kiri
And then we had to relieve him.
Manish Kiri
So whatever he must have written or he has written is coming from disgruntled employee who got caught on certain activities and then the actions were taken by the management in the interest of the.
Manish Kiri
Company and project board.
Manish Kiri
So we need to ensure that we remain on track. We need to ensure that we remain.
Manish Kiri
In full budget within the budget and we need to ensure that the, you.
Manish Kiri
Know, the top team and the CEO.
Manish Kiri
CEO, all the high C level team.
Manish Kiri
There has to be having full integrity.
Manish Kiri
And trust of the shareholders and the management.
Manish Kiri
So we have taken that decision in.
Manish Kiri
The interest of the company.
operator
Thank you. The next question comes from the line of Yash dantevadia from Dante Equity. Please go ahead.
Manish Kiri
Am I audible?
Manish Kiri
Yes, yes, go ahead please.
Manish Kiri
Hi. Hi. So sir, I just had a couple of very important questions. One is your budget is 8,000 crore for the copper plant as you’ve stated before and after tax, I think last on call you clarified to me that you’re going to receive post tax maybe 55 to 5600 crore. So where is the rest of the funding going to come from?
Manish Kiri
It is coming from debt. So.
Manish Kiri
Out of 5,500 crore that we will have post tax we are going.
Manish Kiri
To invest about 3,000 crore as an.
Manish Kiri
Equity in the project and remaining 5,000.
Manish Kiri
Crore is going to come as a.
Manish Kiri
Debt in the project company.
Manish Kiri
Have you already secured the debt part.
Manish Kiri
Has already been secured in terms of.
Manish Kiri
In principle sanction letters parts are awaited.
Manish Kiri
So we are expecting by the time.
Manish Kiri
The equity fully in by by October.
Manish Kiri
November full debt is also going to.
Manish Kiri
Get tied up syndicated.
Manish Kiri
Right. And my next question is regarding your location of your copper plant. And basically if you could just give us some inside Insight on Stage 1, Stage 2, Stage 3, Stage 4 or whatever. How have you planned it? You said revenue will come by FY27, what kind of revenue are you expecting by FY27?
Manish Kiri
So the location of the plant which.
Manish Kiri
Was your first question is at Pipavao port which is in Amreli district in Gujarat.
Manish Kiri
And the site is pretty close to the port.
Manish Kiri
It is only about 8 km distance from the port. And that’s a strategic location which is required for any smelter. Most of the smelters globally are at the port and we are also at the port.
Manish Kiri
So that’s a strategic location.
Manish Kiri
It has facilities connected highways connected to railways and there are other large industries in neighboring areas too. So it’s a strategic location and that’s how the location was selected, right?
Manish Kiri
Yeah.
Manish Kiri
Then, then the second part of your question. You know in what phase, manner and.
Manish Kiri
How the revenue is going to start, correct?
Manish Kiri
Yeah.
Manish Kiri
So 2000 FY 2027 in which we.
Manish Kiri
Would be expecting part of the facility.
Manish Kiri
To start, which would include our downstream products, which would include our refinery and.
Manish Kiri
Certain part of the, of the plant.
Manish Kiri
Will start and the that and that.
Manish Kiri
Would generate at least we are expecting.
Manish Kiri
Close to 12,000 crore of revenue in the first year.
Manish Kiri
And as far as your capacity utilization scale up is concerned, when you say FY27, you’ll do 12,000 crores. What capacity utilization are you factoring in? In the FY27 number?
Manish Kiri
That because at that time full capacity might not be installed, the full capacity would be installed in 20, but the part capacity would be installed and part.
Manish Kiri
Capacity would be operational, correct? Yes.
Manish Kiri
What number have you factored in in your 12,000 rupee, 12,000 crore guidance? What, what number you factored in?
Manish Kiri
So that, that is somewhere close to 25% of our capacity. Let me give you a rough number. Correct. So 25% of the capacity would be. Operational at that time. Out of the total capacity then 2028, another 50% capacity would be operational and. Then 2029 30, another 25% capacity, all capacity would be installed by 2028. Right. So technically by 2029, 2030 we should have, we should have entire capacity operational and that would generate more than 40,000, 45,000 crore of revenue based on the. Current prices of copper. And I’m pretty sure you’ve been, you’ve been following the current copper prices volatility, right? Especially in the COMEX market. How, how do you see this volatility and how do you, how, how do you think you’re going to be able to kind of, you know, navigate yourself in this kind of a market where copper prices are falling intraday by 10, 15% and then going up the same way because of Trump and you know, these kind of sort of global issues. If I may, do you have a plan? Just throw any light, anything on it. Yeah. Hello.
operator
Ladies and gentlemen, the line for the management is disconnected. Please hold while we reconnect them. Thank you. Yeah. Ladies and gentlemen, thank you for being on hold. The line for the management is reconnected. Thank you. And overdue, sir. Sorry, the line got disconnected.
Unidentified Participant
No problem, no problem. So I hope you got my question.
Manish Kiri
Yes, yes, I got your question. And your question was pertaining to the volatility in the market. Yeah, yeah. So number one, you know there would be and you have seen the short term volatility has been there and has been there since few years. Some of the US uncertainties have increased that volatility. Correct. Now, the way the business functions is purely linked with lme. Right. And we would be hedging the lme so there would be a separate team and which is true with every major copper producer if there is a permanent hedging team. So we would be continuously hedging on daily basis for our sourcing of copper as well as our sales of copper, both. So hedging would neutralize the short term volatility and on the long term trajectory, the copper is expected in the next. Two years to touch almost $15,000 per ton. Now, if the long term trajectory is going to be on a positive direction, that would allow us to have expansion in our margins, that would allow increase. In TCRCs with treatment charges and refining. Charges and that would give opportunities to. Expand margins in future. But short term volatility and short term fluctuations have to be managed by hedging and will be capable to do so.
operator
Thank you. The next question comes from the line of Jay Kataria from Goldman Sachs. Please go ahead.
Jay Kataria
Hello. I just wanted to understand we are. Projecting such. Ambitious revenue numbers. Do have you already, you know, identified the buyers? Is there companies that produce?
Manish Kiri
Yeah. For example, today as a country we are net importer of refined copper and consumer products of copper. So for buyers it’s purely import replacements. And you don’t, you know, you don’t need to be worried on the sell side. The most challenging part is the, you. Know, is the feedstock side is to. Secure the copper ore and copper concentrate selling in India. Till we reach 1.8 million ton of production in India, which is the current consumption, it’s all going to be import. Replacements and import replacement. At domestic sales. There are buyers who line up in fact, so there is no problem for sale. Everything is being sold at a spot. Market currently for copper. Okay, we could do, we could do long term contract but if we do long term contract which are linked with the price then we might be losing because people would then ask us to bind in terms of binders in terms of prices which we don’t want to do. We would rather sell material at spot and realize better pricing when lme continue. To increase, increase gradually in future.
Jay Kataria
Okay, I had another question. Since we are planning to only invest 50% of the proceeds from our sale of Di Star into the copper plant, have we like given any thought about what we plan to do with the rest of the corporate. I know this question has been asked I think numerous times in the past three or four con calls, but have we arrived at any numbers or are we just going to sit on it and look for another sector or.
Manish Kiri
Yes, currently we are going to sit on it and it is the common consensus of the board that we will sit on it and we will look. For good opportunities to invest in future. Right. So there is no crystallized deployment plan yet and we would like to have first the cashing and then look at what kind of opportunities come in the. Market in different sectors, this sector, other sectors, you know, but nothing, nothing has been decided yet. We will, we will wait.
Jay Kataria
Okay, thank you. So just last one last question. So when would, when are we planning to have that clarity? So sort of like we, let’s say by October we have the money. So can we expect in Q3’s con call we would have some sort of idea of what we do with the money.
Manish Kiri
I think post money is in, let. Us say by end of the year. Right. So October to December quarter when the, when the funds are in. We should be able to give you. Clarity during that time.
Jay Kataria
Yes, thank you. That’s it from my side. Thank you.
operator
Thank you. The next question comes from the line of Saket from Sagari. Please go ahead.
Unidentified Participant
Hi, thanks for the opportunity. Am I audible?
operator
Yes.
Unidentified Participant
Yeah, just taking a cue from the earlier question. So you know there was also talks of, you know, rewarding the shareholders. So any clarity on that in our. That sitting part is both or there’s some select half goes to copper, some portion we have already decided to share with the shareholders who have been waiting for that. So any clarity on that or any decision by when do we expect any decision on rewarding the shareholders to be made by the board? It would also be in the same quarter when the funds are received. You know first the target is to get funds and ensuring that the sale proceeds come in a timely manner has. Been decided and confirmed by the receiver.
Manish Kiri
But during the same quarter we will also deliberate at the board of KIRI to decide what could be the split of rewarding the shareholders and what could be the portion that we can keep. For the future investments. But as repeatedly mentioned in earlier earlier calls that there would be an amount. Where the shareholders will be rewarded. So sir, based on in essay earliest possible date, which is I think coming as October. So can Q2 be Q2 board meeting? Can be one of those timelines. The earliest possible. Of course Q3 is always there in. Case we can also make an attempt and try to give clarity in Q2. Thanks.
Unidentified Participant
I appreciate our input and patiently answering all the question. And best of luck for future. Thank you so much. Thank you.
operator
Thank you. Ladies and gentlemen. Due to interest of time. That was the last question. Conference over to the management of closing committee. Thank you sir.
Manish Kiri
Thank you all for participating in this earnings conference. Call. If you have any further questions or would like to know more about the matters related to the company. Please reach out to our investor relations managers at Valorum Advisors. Thank you for wishing you all a great day ahead. See you next quarter. Thank you.
operator
Thank you on behalf of Valorum Advisors. That concludes this conference. Thank you for joining us. You may now disconnect your lines. Thank you.