KRITI INDUSTRIES (INDIA) LTD (NSE: KRITIIND) Q3 2025 Earnings Call dated Feb. 13, 2025
Corporate Participants:
Shiv Singh Mehta — Chairman and Managing Director
Rajesh Sisodia — Chief Financial Officer
Analysts:
Deepali Kumari — Analyst
Unidentified Participant
Tanish Jhaveri — Analyst
Saket Kapoor — Analyst
Tanya Kothary — Analyst
Anand Mundra — Analyst
Aditya Sen — Analyst
Aasim Bharde — Analyst
Presentation:
Operator
Ladies and gentlemen, good day and welcome to the Industries Limited Q3 FY ’25 Earnings Conference Call, hosted by Arihant Capital Markets Limited. As a reminder, all participant lines will be in listen-only mode and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing star then zero on your touchstone phone. Please note that this conference is being recorded.
I now hand the conference over to Ms Dipali Kumari from Arihant Capital Markets Limited. Thank you, and over to you, ma’am.
Deepali Kumari — Analyst
Thank you. Thank you,. Good afternoon, everyone. On behalf of Arihant Capital Market Limited, I welcome you all to Q3 nine months FY ’25 earnings call of Industry India Limited. I would like to thank the management for giving Arihant Capital the opportunity to host the call. From the management, we have Mr Singh Mehta, Chairman and Managing Director and Mr Rajesh, Chief Financial Officer.
I will now hand over the call to the management for their opening remarks, post which we can open it for Q&A. Thank you and over to you, sir.
Shiv Singh Mehta — Chairman and Managing Director
Thank you thank you. Good afternoon, everyone, and welcome to the earnings conference call of Priti Industries Limited for the 3rd-quarter of the financial year 2025.
Let me start by giving you some brief highlights for the quarter. The last six months and particularly last quarter Q3 have been very challenging for the company. Company is under annual contract to procure its raw-material from regular PVC manufacturers. However, during this period, open-market prices of PVC were substantially lower than the prices at which company was buying. In addition to this, international polymer prices continued to decline. All these factors not only impacted overall business, but also operating margins.
The agreement — the agri segment volumes grew marginally by 2% year-on-year basis to 16,511 metric ton as compared to 16,230 metric ton in Q3 financial year ’24. The Building Products segment, total volumes grew by 30% year-on-year to 2,262 metric ton as compared to 1,553 metric tons in Q3 financial year ’24. While the Industrial segment volumes declined significantly from 3,496 metric ton in Q3 financial year ’24 to 931 metric tons only in the Q3 financial year ’25. Therefore, in Q3 financial year ’25, total sales volume were 19,704 metric tons as against 21,479 metric tons in Q3 financial year ’24.
I will now hand over the call to our CFO, Mr Rashil to give you financial highlights.
Rajesh Sisodia — Chief Financial Officer
Thank you very much, sir. Good afternoon, everyone. Let me take you through the financial performance of our company on a consolidated basis. Our revenue for the quarter was around INR210 crores, which declined by around 14% on Y-o-Y basis. There was an EBITDA loss of INR1.4 crores and a net loss of INR11 crores for this quarter. For the nine months ended financial year 2025, our revenues were around INR584 crores, which declined by around 13% on Y-o-Y basis. EBITDA declined by 38% on Y-o-Y basis to INR28 crores with EBITDA margins reported at 4.83%. The net loss for the period was around INR60 lakhs.
We can now open the floor for questions-and-answer session.
Questions and Answers:
Operator
Thank you very much. We will now begin the question-and-answer session. Anyone who wishes to ask a question may press star and one on their touchstone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles.
The first question is from the line of Shiv Raman Krishnan Kodali, who is an Individual Investor. Please go-ahead.
Unidentified Participant
Sir, the question is that from whatever the statement, I understood that your procurement contract is at a particular price per throughout the year? And normally in which case your selling price also should be fixed. How is it that you know that market prices are very low compared to your procurement prices of the raw-material? And what do you intend doing going-forward? How long would this continue because two quarters of losses, so an investor one would be concerned. So what is the strategy for the company to elevate this problem?
Shiv Singh Mehta
You see the contracts are annual. So they get over by March 2025. Thereafter company will have to revisit the — I mean, procurement based on current given market realities and situation. We are already and working out on that once these contract period is over.
Unidentified Participant
But normally when your input prices are on an annual contract, normally would have an output prices also should be an annual contract. Is that not true? Do you not follow that?
Shiv Singh Mehta
Actually, there is a certain basis on which most of the companies manage their prices. They are flat. These are international agencies who give indicated prices. But in this particular situation in India, in last six months, the governing prices in local markets are much, much below all these referred prices or linked prices to certain basis-points.
Unidentified Participant
So what would be the solution for this sir going-forward for the company?
Shiv Singh Mehta
Government has been talking about putting ADD. For last four months, we have been all waiting, all processes have been completed by government. Already notification details have been also circulated. But the final — I mean pronouncement is yet not happen and everyone is waiting for that.
Unidentified Participant
And how about the growth in the revenue because in the first-quarter conference call, I mean, you were pretty confident about growing, 15% 20% per year where it looks like there is a degrowth.
Shiv Singh Mehta
So degrowth is only on account of institution, both major businesses of ours that is agriculture and building material are growing. But yes, we have been very cautious about institutional business and that is where there is a degrowth. De-growth was, as we had explained in last call itself, the company is quite conservative and careful in taking businesses. More importantly, as most of the institutional business is linked to EPC contracts and these are mostly government contracts and that is where most of the EPC contractors and unless we are sure about timely payments and cash-flow cycles are positive, we don’t. That’s why we have been very restrained in this area of business?
Unidentified Participant
And you talked about expansion of production capacities and your listing compens listing. What exactly? Is it higher value-added products or is the same products where —
Shiv Singh Mehta
We are going ahead with our expansion plans. Already during this current year, INR20 crores capex has been — payout has been already made and we are further going ahead with our plans. Our plans are almost towards conclusion before end of this financial year before we make annual operating plan for the coming year. And as you must be aware that we had raised warrants and that’s where we would be working towards medium to long-term growth plans, which will be finalized by the Board and then it will be available.
Unidentified Participant
So for there be vertical new products with higher margins that would be similar products of existing capacity.
Shiv Singh Mehta
No, we will certainly look towards higher-margin products and we will also look at the opportunities around which we would like to encash.
Operator
So does that answer your question?
Unidentified Participant
Yeah. I’ll come back if I have any more clarification.
Operator
Thank you. The next question is from the line of Danish Shavedi from Omkara Capital. Please go-ahead.
Tanish Jhaveri
Hi, yeah. So I would like to know like considering the inventory losses are for everyone, how long — like how long do you see that — like after how long will we normalize the margins, like how long do you think this will sustain?
Shiv Singh Mehta
You see, there is — I mean everyone is waiting for I mean, additional dumping duties, which government has already circulated all traps and everything and still that has not come through. One, number two, even the local raw-material manufacturers are now aligning their prices. And I mean, it’s not that fully the gap is fully bridged between open-market prices and manufactured prices. But still they are — in this month itself, they have brought some corrections and we hope that looking to the industry demand and requirements, there will be realignment in prices where the local prices may look up or raw-material manufacturers may adjust a little bit here and there. And also if ADG comes, then all these situations may also rectify.
Tanish Jhaveri
Okay, that’s great. And the next thing I would like to move on is, have you seen any pickup in your industrial segment during Q4 or is it still stagnant?
Shiv Singh Mehta
So the industrial segment is looking up now because now after elections, I think the new finances are getting cleared and those monies will flow. But as I’ve been maintaining, we will keep ourselves — to limited numbers as far as industrial segment is concerned. We’ll not go aggressively on this area of business. Our major focus will be BP, where we are growing well and we are getting reasonably good response. And this is along with agri, that will be our major focus of business.
Tanish Jhaveri
Okay, that’s great. And how do you foresee building products growing like is it going to the momentum of the revenue is going to get better or how do we see that playing out?
Shiv Singh Mehta
Can you repeat your question, sir?
Tanish Jhaveri
The building product, do you see it moving at the same rate at the situation is moving or do you see a slowdown or how do you see the building product segment moving ahead?
Shiv Singh Mehta
The product segment will grow faster than what we have grown so-far. Okay. That’s correct. But think that the growth rates will be faster than what we have today.
Tanish Jhaveri
Okay. And I understand that we have a fungible capace capacity, right? So do you foresee like some of the IP — like the capacity used for IP like the industrial segment will be used for building products?
Shiv Singh Mehta
There is this fungible capacity, not everything but quite a substantial portion of extrusion is possible, but molding is specific to our business because molds are specific.
Tanish Jhaveri
Okay. Thank you.
Operator
Yeah. Thank you. Before we take the next question, a reminder to all the participants that you may press star and one to ask a question. The next question is from the line of Saket Kapoor from Kapoor; Company. Please go-ahead.
Saket Kapoor
Namas. Sir, firstly, have we factored in any inventory losses also for this quarter or what explains, sir, although our revenues are up Q-on-Q from September to December, but the PBT have increased.
Shiv Singh Mehta
You see, there are definitely inventory losses, but more significant was the margins because the local prices of raw-material was much lower than at which rate at which we are getting from our suppliers?
Saket Kapoor
Okay. And sir, can you give some color, firstly, of what majorly constitute our RM basket and the price trends in the raw-material of the trajectory that has changed over Q1, Q1 year-on-year basis.
Shiv Singh Mehta
You see the question is that you see when prices are on a declining trend, your imports normally arrive on Indian shore after 40 days or 45 days of shipments. So there is a time lag between the price contracted to the material deliver. Number two, the local prices of local manufacturers generally are aligned with the — and the local market prices are aligned with a marginal difference maybe here or there. But this time because of huge imports into country and I mean, lot of trading stopped floating, the market prices were you know, very suppressed.
Saket Kapoor
So sir, can you give some more color on the RM basket? What in percentage terms, what are the key constituents and how have been the RM basket prices here?
Shiv Singh Mehta
For example, I mean, PVC the difference between local market and the raw-material manufacturers or landed prices were to the significant extent of 8%, 7%, 9% month-to-month, they will be even higher than that. But now for the first time, you can see that even local manufacturers are correcting their prices.
Saket Kapoor
Okay. And sir, this is a demand issue or only an inventory clearing because of the international prices correcting. Because just say 8 point to clarify the institutional activities or government capex when a project made funding release may unique current institutional projects again supply. Two other after Joe Pitchla quarter or the nine months, vertical wise business environment may care factors play-out UK or product from. Vishu international environment here, economies are struggling most of the economies. So do extra polymer production, normally world market has who it is —
Shiv Singh Mehta
I mean, India is only green shoot as far as the material is required or consumption is there. So most of the material is getting diverted towards our country. And number two, even the international freights have come down. So that’s why their prices, landed prices as compared to they were are much lower. Now Indian manufacturers, normally the contracts are based on certain international linkages like or ICs and other such boards. But when the volume of material is very-high in local trading channels, the prices are depressed and prices are — and in a declining market, they are sold more aggressively. So prices further go down because in anticipation of prices go down, you want to liquidate your stock. So this is why the local prices of raw-material are much lower. So now everyone is now realigning and correcting this position and even government is quite aware and that’s why they have taken these steps of ADD and all these initiatives to protect local industry.
Saket Kapoor
So we are anticipating an ADD on PVC regions or with PVC.
Shiv Singh Mehta
Government has already issued and circulated the country-wise manufactured wise ADD, which they will like to apply, their only notification is awaited.
Saket Kapoor
The cadget part is left, that is what you are saying.
Shiv Singh Mehta
That everything has been circulated.
Saket Kapoor
Okay. And what has been the notification, sir, — country says Amara main dumping cars are a ornoni, that will be the exact numbers, sector,
Shiv Singh Mehta
But generally what people discuss and industry talks is the major dumping is coming from a country next to us this is of.
Saket Kapoor
Sir, sir, if we take the segment-wise our operational performance, agri, industrial and the building product if in — just in a bit, if you could just explain how these segments or the forward-going revenue trajectory looks like and the factors that will influence the volumes going — going ahead since your focus has always been in developing this building products segment and going slow on industrial and maintaining the agri part, if I’m correct, these are the way you have guided us earlier. So, sir, ABM, so hypothetically, if AD LED comes in, Uske scenario, a or anticipate LEA in terms of at least utilization levels improved Karna and these two verticals of the building product and industrial and agriculture behaving going ahead.
Shiv Singh Mehta
See agriculture will continue to grow as per the regular 8% to 10% annual growth rate. BP will grow much faster for us, particularly because we have a low-base and we are seeing good traction from market. So BP growth rates will be far more than what we have achieved so-far. Now as far as industrial is concerned, I mean, after election is norm, almost new budget has also come, money allocation has been made. So there will be better demand in institutional business or supplies. But as I have been maintaining, we’ll be careful. We will not go very aggressive on this. We’ll try to have a reasonable business volume for particular category of products where the margins will be better, where competition is less and where the customer or the EPC contractor cash flows are protected.
Saket Kapoor
For my ignorance, but building product profile car attack or institutional sales are nine months from MRA receivables care. MRI outstanding receivables because Jada, because we are —
Shiv Singh Mehta
Our policies are of very firm payment cycle from all the dealers and we are mostly engaged with our own dealers. And as far as institutional sales are concerned, as you are saying, our sales have come down significantly. So I mean, there are hardly any outstanding as far as institutions are concerned, because you would see that from a level of I mean we have come down from an institution how much? Down by how many percentages? 73% sales are down. So you can understand hardly outstandings are there.
Saket Kapoor
Okay. And sir, here we do business by order booking, that is what the trend is for the government. So there are no further orders in the backlog that —
Shiv Singh Mehta
We need to be supply to EPC contractors.
Saket Kapoor
Yes, that is what —
Shiv Singh Mehta
We are buying there were under turnkey contracts for government.
Saket Kapoor
Sir so just in nutshell, we can — the reason for this — this collapse in margins and profitability is owed to some restraint from the part of government itself itself, wherein the EPC contractors have been affected and in-line to that, we being the facing and at the receiving end-of-the EPC contractor have suffered in the profitability part. This understanding is correct, sir.
Shiv Singh Mehta
We had anticipated that post elections and the EPC contractor payment cycle will be under strain. And that’s why we were not taking up any business in order internationally going — I mean, we were not pursuing business to be — I mean as I told you even last quarterly reviews that we were not pursuing business. We were very careful. We wanted to be careful because we know that once you get stuck, then you have your own challenges and problems with EPC contractors.
Saket Kapoor
Okay. And lastly, sir, what is our net-debt numbers? I think so we raised fund through QIP and also some payment for some warrant conversion by promoters have also happened very recently. So if you could just give some numbers on the same processor or I mean, the December quarter company I had because of this conversion.
Shiv Singh Mehta
Khali promoters may convert TI about INR17 crores worth of warrants into equity. And the reason I’ll always explain, you see, in the current stock exchange rules, if you are having acquisition of more than 5% on a creeping basis, it triggers certain other rules. So we wanted to be very careful. That’s why we want to divide into two financial years. So 50% conversion was done here and 50 will be done in the next financial year.
Saket Kapoor
Okay. And the balance to the non-promoters, they will follow the cycle for 18 months.
Shiv Singh Mehta
We — because we will take funds only when we are starting our capex cycle. We don’t want to take any money upfront and pass the money here. We must be very prudent in our financials.
Operator
Thank you. The next question is from the line of Manoj from Capital. Please go-ahead.
Unidentified Participant
Good afternoon, sir. Thank you so much for taking my question. My first question is regarding if you most of the infra players talked about there is a delay in and missile and like what is the impact on our business.
Operator
I would request you to please use your handset because your voice is right now sorry, sir, could you repeat please?
Unidentified Participant
Ma’am, I’m audible properly.
Operator
Can you keep your microphone little away from your delay.
Unidentified Participant
Okay. Sir, like a few of the infra plays talked, there is a delay in Chelsea 1 mission, like what is the impact on our business because of the delay?
Shiv Singh Mehta
I couldn’t get you clearly. Can you help me by repeating your question?
Unidentified Participant
And yes, sir. Sir, like a few of the infra players talked about there is a delay in mission.
Shiv Singh Mehta
Mission you are talking about.
Unidentified Participant
What is the impact on our business because of this delay?
Shiv Singh Mehta
Right. You see, so-far we were not active in mission. Even last quarterly call, I had said that going-forward from next year, we will get active in Jal mission. So-far our entire sale is in retail network.
Unidentified Participant
Okay, sir. Sir, like in — if you look at South regions, especially Andhra Pradesh and Tamilado, it’s been impacted because of unseasonal rains and floods and all. If you could share more demand environment region-wise, Southwest, North, because we have presented around 16 states.
Shiv Singh Mehta
Your voice is really going so much is difficult to understand. Can you speak little slowly and help me to understand?
Unidentified Participant
Yes, sir. Sir, like if you look at in South area, South regions like especially in Tamilado and Andhra Pradesh, a lot of unseasonal rain and flood has been impacted the overall demand. Like I just want to understand how is the demand environment region-wise, Southwest and Northeast because we have presented around 16 states.
Shiv Singh Mehta
See, as far as building materials are concerned, the demand is consistent and across all segments across India. It is not affected by sudden rains or short rain cycles. There can be a temporary impact of 10 days, 15 days, nothing more.
Unidentified Participant
Okay, sir. Got it, sir. Sir, like the — sir, another question, the governments have been like planning for smart cities and water management side, we have any plan to introduce new product lines or regional expansions?
Shiv Singh Mehta
No, we will definitely look at opportunities and try to address them. But as I have said that for institutional business, our focus is limited. We will not get aggressive in that area.
Operator
Does that answer your question, sir?
Unidentified Participant
Yes good.
Operator
Thank you. The next question is from the line of Tanya from AUM Capital Private Markets. Please go-ahead.
Tanya Kothary
Yeah. Good afternoon, sir. I just have questions covering your volume, sales and price trends in all the segments. I could say that agricultural products, despite contributing 78% to the total revenue, there is a fall in price by 4% in nine months. And what is the key reason in this price decline so do you anticipate a recovery in this price?
Shiv Singh Mehta
No, no, raw-material prices have come down. The very material used to manufacture a product like PVC has substantially come down in terms of prices of product, which we buy as input raw-material.
Tanya Kothary
Okay. Sir, the following question has, say our nine months raw-material cost is INR450 crores. In this, how much have we imported and how much you know have been impacted by this price variation?
Shiv Singh Mehta
See it is that as I was explaining, the impact has been because of two reasons. One, the declining prices of material and you always carry some inventory and the prices — declining prices definitely impact the trading loss or trading gain. Number two, because there was voluminous import by trading channels in India, all throughout this period, the local market prices of material are much below the contracted rates at which company buys.
Tanya Kothary
Okay, sir. Sir, I could see the net-debt increase from INR105 crores in FY ’24 to INR112 crores by half — half yearly FY ’25, there is a signaling in leverage — rise in the leverage. How does the company plan to reduce the short-term debt? Are there any refinancing options to lower the interest-rate because I think that is also impacting the EBITDA margins?
Shiv Singh Mehta
No, no. I mean, as far as companies financial placement is concerned, we are comfortably placed. We don’t have much debt on-book and we are working on a business plan where we will be conservative towards additional debt.
Tanya Kothary
Okay, sir. Sir, what kind of EBITDA margin do we are we looking ahead, sir, like will it be below 6% or so or we can see an uptick there in the 4th-quarter or in the coming year?
Shiv Singh Mehta
See the EBITDA margins should certainly improve going-forward from coming year because our procurement contracts are for on annual basis, which will expire by 31st of March this year. So obviously, thereafter, we should be able to demonstrate better performance.
Tanya Kothary
And what kind of sales revenue growth are — after this kind of numbers, do we expect like the management is looking-forward to?
Shiv Singh Mehta
Yeah, top-line growth, we are certainly looking as I was telling earlier to replying to a question that we expect we to grow much faster than what we have shown so-far. We have also said that agriculture business is definitely growing in India at a reasonable rate and we would be seeing a growth overall at 8% to 10% and for industry as a whole.
Tanya Kothary
8% to 10% in the — I mean the growth in top-line.
Shiv Singh Mehta
Top-line.
Tanya Kothary
Okay, okay. And sir, while there is an extreme fluctuations in this ETR that is effective tax-rate, sir. If I could see 27% in Q3 FY ’24, 57% in Q2 FY ’25. So what factors are driving this kind of volatility in the tax-rate.
Shiv Singh Mehta
Sir the volatility in the profitability, am I right, we are asking for a profitability as I was explaining that the world market is going through a lot of turmoil and the material movement, supply channels are shifting towards more affordable or competitive scenarios, that is where the prices of material that is commodity are quite depressed at the moment.
Tanya Kothary
Okay so how? How long do you see this thing going with this raw-material going going ahead, like is it going to be marginally higher or it is going to be flat? How do you see the raw-material prices impacting the operations of the business?
Shiv Singh Mehta
You see government is obvious of this challenge. That’s why as you must be aware, the government has already created draft for ADD, actual dumping duty on PVC and that is the notification which is still awaiting.
Tanya Kothary
Thank you, sir. That’s all from my side.
Operator
Thank you. The next question is from the line of Anand Mundra from Saw Wealth. Please go-ahead.
Anand Mundra
DR. Wanted to understand —
Operator
So we had procurement sir, I would request you to please use your handset?
Anand Mundra
Ma’am, I’m using handset only. Now it’s better.
Operator
Yeah, yeah, it’s better. Yeah.
Anand Mundra
Sir, wanted to understand we have annual contract for supply of raw-material. So we can’t change the price in-between. Is that — is that the condition, sir?
Shiv Singh Mehta
Prices are linked to flat. It is a international exchange, which determines the prices. They are linked. So prices are linked and the local market operates on a buying, selling. So that is a definite difference between two. And this time the thing has been where the delta difference is fairly large.
Anand Mundra
So all the unorganized players have reduced the prices, so we ended-up reducing the prices. Correct, sir?
Shiv Singh Mehta
Right, right. The whole industry had to — it’s all-in line because those who are on a day-to-day procurement basis had a much bigger.
Anand Mundra
So sir, this will get resolved only if Indian government puts anti-dumping because annual contract will again have the same problem next year because we will be linked to international prices and —
Shiv Singh Mehta
Negotiate a contract. So everyone is oblivious to the current realities, including manufacturers and the buyers. So everyone is talking about it, very healthy atmosphere. Everyone wants to solve the issue amicably.
Anand Mundra
Okay, understood, sir. Sir, another thing I wanted to understand what is our guidance on building products in PVC pipe for this financial year in terms of volume growth.
Shiv Singh Mehta
We fair — we see a fairly robust growth, I mean much better than what we have achieved so-far because going-forward, this is where major business focus is as far as company is concerned.
Anand Mundra
So any numbers, sir you can put, sir, for — because sir, for CPVC, you mentioned in the first-quarter call that you are targeting INR170 crore of revenue.
Shiv Singh Mehta
Yeah, we are definitely working towards that number. And I think you will see it coming for next year, you would — our numbers would be far, far better than what probably we have so-far achieved because our — all efforts are to development of market and business in maybe the Building materials segment.
Anand Mundra
Okay. And sir, suppose Industrial Solutions business comes back also, we don’t want to increase this business.
Shiv Singh Mehta
We will be always having limited exposure. We will not go very aggressive on industrial segment.
Anand Mundra
Okay. And sir, any guidance in terms of tonnage for CD building products business, sir?
Shiv Singh Mehta
You see, next year, I think I would be very happy if we can double the rate of growth than what we have so-far?
Anand Mundra
Okay, understood, sir. And sir, with respect to your expansion plan, any thoughts when we will be able to finalize this and where are you putting up the plant?
Shiv Singh Mehta
I think it’s a question which is panding for some time. Our work is almost getting finalized on that. And once our Board agrees and decides, we will definitely share our information.
Anand Mundra
Okay. Because sir, we have tied-up finance long back sir and in any case —
Shiv Singh Mehta
We had tied-up, but with this kind of a market as it was going through, we want to be very sure that what we do is on the right-side of the — which side and where to go all that decisions we’re.
Anand Mundra
Okay. Thank you, sir. Thanks a lot. Thank you.
Operator
Thank you. The next question is from the line of Aditya from RoboCapital. Please go-ahead.
Aditya Sen
Hi, thank you for the opportunity. Sir, I wanted to —
Operator
I would request you to please use your handset.
Aditya Sen
Sure. Audible now?
Operator
Yes. Yeah, yeah. You are audible now.
Shiv Singh Mehta
Yeah.
Aditya Sen
So I wanted some color on our geographical expansions that we are doing into the other states. How is it panning out?
Shiv Singh Mehta
No, that’s where we had said that we will definitely go towards areas which are logistically far away from our existing plant. So normally, normally we would be looking more options in North and South for our growth plans.
Aditya Sen
Okay. And any guidance on the EBITDA margins of the building segment?
Shiv Singh Mehta
No, I certainly feel that building segment has offer much better EBITDA margins than agri and that’s where our focus is. And if material prices correct, the EBITDA margin should be in-line with industry. And you will see generally industry is showing between 16% to 20% EBITDA margins. So we will try to catch-up with the industry in EBITDA. But it takes — it’s a — it doesn’t happen in steps, it will be a gradual journey towards that.
Aditya Sen
Yeah, I understand that. Thank you. All right. Got my answers. Thank you.
Operator
Thank you. Before we take the next question, a reminder to all the participants that you may press star and one to ask a question. The next follow-up question is from the line of Saket Kapoor from Kapoor; Company. Please go-ahead.
Saket Kapoor
Yes, sir. Sir, if you could give us the utilization levels our different segment or in whatever way you want to quantify for this quarter and for the nine months.
Shiv Singh Mehta
Can you repeat what you want exactly?
Saket Kapoor
Sir, I’m looking at the utilization levels in terms of tonnage capacity here, how much are we utilized for quarter and for nine months?
Shiv Singh Mehta
We have published the data how much tonnage we have done yes, the capacities are mostly is fungible so you can produce certain products from same machine for each of the three verticals.
Aditya Sen
That is correct, sir. But I was asking, we have this nameplate capacity of — in totality of AX and we have done X minus 5 or X minus 20, that was my understanding in percentage terms. If you would give us the operating leverage going ahead.
Shiv Singh Mehta
Our extrusion side, we have a liquid capacity. But molding side, we still have to catch-up with the requirement, which we have built-up a little last some time with this capex we have done and we will be further augmenting our molding capacities.
Saket Kapoor
Okay, sir. And lastly, sir, the finance cost clear, have you a net-debt number sir 30th December or my working capital key requirement and cost of fund care.
Shiv Singh Mehta
My Aco, I’ll ask CFO to send you detail if you can actually make us number of fund AM, but I’ll get back to you later. Right thank you, sir.
Operator
Thank you. Ladies and gentlemen, you may press star and one to ask a question a reminder to all the participants that you may press star and one to ask a question. The next question is from the line of Asim from DAM Capital. Please go-ahead.
Aasim Bharde
Yeah, hi, good afternoon. Sir, just wanted to understand the reasoning behind getting into annual contracts for your supply. Is there like some benefit that you ideally get? That’s why you negotiate these prices or other these contracts are for so long and you have no scope for changing prices in-between.
Shiv Singh Mehta
So you see PVC India produces only 40% of domestic demand and 60% is imported. So one has to have a security on the supply line. So all the — I mean, larger manufacturers and processors have an agreement generally with certain component of material, which is a short supply line. You can have only 20% or 30% where you don’t have a tied-up resource and you may be buying this year, as you know, the entire world market is suffering. So there is excess available capacity. Normally, you will find that we all struggle for the material.
Aasim Bharde
No, but this problem, I mean in terms of supply surety and all should be an industry-wide problem, right? I don’t think the industry has talked about a supply issue. That’s why I’m wondering why the need for such long-term contracts for a very volatile commodity-like PVC.
Shiv Singh Mehta
That is an issue. Today, supply is more than what you need. You can buy any quantity is readily available.
Aasim Bharde
So then we should not be in such long-term contracts, right? That’s understand your rationale behind. Is there a pricing benefit that you think about because the supply issue got sorted at least more than a year-ago.
Shiv Singh Mehta
So,, this is where I said that all these discussions are on for rationalizing your next year’s procurement plan. But what you have contracted is a contract, you have to fulfill.
Aasim Bharde
So it was last — I don’t disagree with that point. Contract is a contract we need to fulfill. Basically, why the necessity — or let me put it this way, come March is when this contract ends, right, from April, will we still be doing an annual contract?
Shiv Singh Mehta
No, we are seeing what kind of a contract has been entered the controls of contract or the conditions of contract may be reviewed or it may not be done. It will all depend how the negotiations go from now till the time we decide the next year procurement plan.
Aasim Bharde
Do we depend on imports for our entire PVC or other polymer resin requirement or is that local suppliers also?
Shiv Singh Mehta
Yeah. We inforce substantial part of our requirement, but we also have local sources and supply lines.
Aasim Bharde
Okay. And at any given point of time, what is — just to understand if today you ask your supplier to deliver you say in the future sometimes some X amount, how much time will it take from your supplier till it reaches your factory?
Shiv Singh Mehta
You see, it depends. If suppose you are importing from a country which is far, it may take longer time. And if it is closer, like for example in Korea, Indonesia, maybe closer than USA or Mexico. So it will depend where you strike a contract and what is the shipment voice time involved in the process. Normally, after opening LC, it takes 10, 15 to 15 days for shipment, voice time, then clearance at port and bringing it to your factory, it’s about 40 to 45 days cycle.
Aasim Bharde
Okay. Okay, thanks. Thank you.
Operator
Thank you. A reminder to all the participants that you may press star and one to ask a question. The next follow-up question is from the line of Krishnan Godali, who is an individual Investor. Please go-ahead.
Unidentified Participant
Sir, you have been in this business for about 30 years now. Have you seen what happened this year-earlier? Or is it the first time this has happened that the raw-material prices behave the way they do? And normally in businesses, only when our selling price is fixed, we also tend to fix the raw-material price. And our selling price is not fixed. If you fix the raw-material price, I think that’s a major challenge that we have experienced in this particular year. So that’s the reason I’m asking you, did you experience this earlier in the last three decades that have been in the business, are this the first time? And second thing is, is the worst behind us or there is some more time this problem is going to continue in a sense like you’re saying from next year onwards, your procurement strategy itself will undergo a change.
Shiv Singh Mehta
Okay. So that’s a similar situation in 2008 at the time of world crisis.
Unidentified Participant
In the global financial crisis.
Shiv Singh Mehta
At that time also, the prices drop like 9 pin almost. And this is again we are experiencing this year in the international market. And probably this is because of what’s happening to Europe, what is happening to US, what is particularly happening to China. China is the most prominent factor because they are the largest consumers and they are the most impacted.
Unidentified Participant
Yeah. So that’s the reason for next year onwards, your procurement strategy would change. That’s what you’re trying to say.
Shiv Singh Mehta
We will realign our production strategy, looking to the — and even the manufacturers understand that. They are also started correcting from the fabric itself. They also understand that the processors will have to be supported in a given situation.
Unidentified Participant
Because you yourself have been mentioning that you are basically looking at increasing our EBITDA margins on par with the rest of the industry, piping industry, which are typically between 15% and 20% because historically, if you see our company’s EBITDA margins are nowhere close to that. What exactly is probably the issue there?
Shiv Singh Mehta
Major reason is what kind of a raw-material procurement strategy you adopted, whether it is aligned to the current realities or you have gone wrong on that given the change in the market space. And number two could be that the product you sell like BP, how much you sell and agri, how much you sell because each of these products offer different margins. That’s why we have been working on this for last one year to realign our product and sales strategy along with now raw-material procurement piece is to be very clearly and objectively looked into for correction.
Unidentified Participant
So my question remains is that is the worst behind us, we still have some more time to suffer.
Shiv Singh Mehta
So I think the things have started getting on a correction side. I would say that this Q4 may be still not that great, but from Q1 next year, we hope to be doing much better and what we expect because we will be able to put all things behind us by then.
Unidentified Participant
Okay. Thank you.
Operator
Thank you. As there are no further questions from the participants, I would now like to hand the conference over to the management for closing comments.
Shiv Singh Mehta
So thanks to all the investors for your participation. And we certainly look-forward to your more support because in these times your support becomes even more critical and essential. Thank you.
Rajesh Sisodia
Yeah, thank you, Madam.
Operator
On behalf of Arihant Capital Market Limited, that concludes this conference. Thank you for joining us and you may now disconnect your lines.