LMW Ltd (NSE: LMW) Q3 2025 Earnings Call dated Jan. 27, 2025
Corporate Participants:
V Senthil — Chief Financial Officer
Analysts:
Nirav Vasa — Analyst
Manish Goyal — Analyst
Aditya — Analyst
Presentation:
Operator
Ladies and gentlemen, good day and welcome to earnings call of LMW Limited for Quarter 3 of FY 24-25 hosted by NSDL. As a reminder, please note that the participants lines will be in lesson only mode and there will be an opportunity to ask questions after the brief by the company officials. Should you require any assistance during the conference call and raise questions, please signal the operator by raising your hands. Please note that this call is being recorded. And this is Sameer from NSDL.
We have with us Mr. V. Senthil, Chief Financial Officer; and Ma’am B. Dhanalakshmi, Senior General Manager of the company. And over to you, sir.
V Senthil — Chief Financial Officer
Thank you. Thank you Mr. Sameer. Very good afternoon to everyone and thank you for joining the LMW earnings call for Q3FY 2425.
We will have a brief about the overall performance of the company for a period ending December 24th followed by an interactive session. I would like to clarify that certain statements made in the discussion the conference will be forward looking in nature.
To begin with, let me explain the overall performance of the company. Then we’ll go into segment wise and consolidated performance. The financial results have been posted on the company website and I hope you had an opportunity to go through the same. The revenue for the quarter ended December 24 is 710 crores as against 750 crores for September 24 which said a decrease of around 5%. For the nine month period ending December 24 the revenue stands at 2,200 120 crores as against 3,645 crores for the same similar period for the last year.
The PBT for the quarter stands at 36.8 crores as against 38.2 crores for the immediate previous quarter and for the nine month period it stands at 92.5 crores as against 393 for the ninth month period for the previous year. I would like to explain the exceptional item of around 132crores during the quarter. This is a profit which has been booked on account of transfer of 100% shares owned by LMW in LMW Textile Missionary Suzhou Co. Ltd. Which is our Chinese subsidiary and LMW Global FZD which is our Dubai subsidiary to LMW Holding Ltd. Which is again a wholly owned subsidy of LMW.
The sales consideration which was paid net of the cost of investment has been deflected as profit in the standalone books. However, since these are within the same entity, these are knocked off a consolidated level. Now going to division wise detail, the TMD revenue stands at 450 crores for the current quarter as against 456 crores for the previous quarter and for the nine month period that the turnover was 1347 crores compared to 2908 crores for the same period during the previous year. This is a reduction of around 54%. The overall loss for this division in the current quarter stands at 3 crores and period. To date the loss is 22 crores as against a profit of 270 crores during the last similar period last year.
With respect to the order book, currently we hold an order book of 3,100 crores of which the active orders are around 2,300 crores. With respect to the sales which has been clogged during the nine month period. The ratio of domestic versus export and spares stands at 71% of this turnover is domestic, 7% exports and 22% is spares. As we have mentioned earlier and we continue to mention, we have gone into a five day working as far as Textile Missionary division is concerned and so is foundry. And this would continue to be so in the current quarter as well. This is on account of lower capacity utilization which is sub 50%. And this trend would be continued to be monitored and depending on the order flows we will take addition otherwise.
Now with respect to LMW Global, the turnover for the nine month period stands at 75 crores as against a comparative number of 250 crores. For December 23. The profit for the current period is 1.47 crores as against the previous period profit of 12.98 crores. And the order book in LMW Global stands at rupees 280 crores. In LMW China for the nine month period ending December 24th the turnover stands at 54 crores. And for the comparative period last year it stood at 18 crores. The order on hand. The order book on hand in China is 22 crores.
Now I move to Mission Tool Division and Foundry. The revenue in Machine Tool division and foundry stands at 728 crores per nine month period ending December 24 as against 756 for the corresponding previous period. Out of this around 11% relates to the Foundry division. The balance is towards Mission Tool Division.
With respect to ATC, the revenue for nine month period stands at 123 crores for the nine month period as against 133 for the corresponding previous period. At a consolidated level the revenue stands at 2,300 crores for the nine month ended in December 24 as against 3,238.53 crores during the corresponding previous period and profit at Rupees 90 crores as against Rupees 395 crores during the corresponding previous period.
With this brief I would like to continue to the interactive session. Over to you, Mr. Sameer.
Questions and Answers:
Operator
Thank you so much, sir. Next we would request the people in the attendees to please raise your hands to raise questions. The people in the attendees, can we have you raising your hand so that that we can proceed with the questions please.
Sir, we’ve got Mr. Nirav. Mr. Nirav, you have been unmuted and we can also have your video turned on if you like. And we are ready for your question.
Nirav Vasa
Good afternoon sir, this is Nirav from ASK here. My question is pertains question is pertaining to the demand outlook. So I understand that we are a very dominant play — Is my voice clear?
V Senthil
Yes, now it’s clear. It’s better.
Nirav Vasa
We are a very, we are a very strong player in the spinning and yarn machinery. But looks like the demand scenario is not in our favor. Based on your assessment, when you are interacting with your customers, how do you see the demand scenario? And what we are seeing is two major tailwinds. Can China plus one and now with Bangladesh plus one both turn in our favor? And by what time are you expecting any major turnaround in the utilization which can eventually result in increased demand for spares leading to ordering activity as well? Thank you.
V Senthil
Any other questions, Mr. Nirav so that I’ll take it on…
Nirav Vasa
Maybe can I ask on the machine tool division after this question please?
V Senthil
You can give me the question, I’ll answer it and…
Nirav Vasa
Okay. Okay. Sir, in machine tool division we are a decent player in the CNC machines. So have we seen any kind of a slippage from the customer perspective? Because we are hearing that the capex is not getting canceled, but it is getting postponed. So has there been any scenario wherein a customer has extended the delivery period? And third, with regards to advanced machinery tools like what we are seeing, even if I look at the data from last four, five years, there has been no major offtake or I can say no major growth that we are seeing despite the defense ordering picking up at a very, very brisk pace in last couple of years. How do you see the outlook there? Is there any change in strategy? And more importantly this was pertain to defense. But if I look at from the civilian aviation space, some of the companies which recently got listed, they are. They are getting big time into MRO and other activities. So do we also intend to get into that those space as well? Thank you very much.
V Senthil
Okay. I think it covers quite a lot. So let me try and take all of…
Nirav Vasa
That’s why I was trying to ask one by one that would have been much…
V Senthil
I like it like this. No issues, one by one. So with respect to the spinning TMD segment first a couple of positives and negatives and what we see is kind of happening of course I should say that this kind of a slowdown what we have kind of experienced over the last year and year and a half probably sets a record in terms of the longest slowdown what we have seen. But now what is perhaps unique is that this is happening across the globe across various country segments and you are absolutely right China, India being where we are a dominant player there are a couple of factors which is really not helping the Indian spinners at the moment. Right.
The fact remains that the cotton prices are little bit on a higher side so the spread between cotton and yarn is not great and right now there were probably losses earlier part of the year. Now they’re probably making some margins and ideally what’s happening is that they take some time to come back to making capex investments. So what we have order books are getting pushed out longer and longer. I mean that’s the way it is now. The reason of course there is some expectations and we can’t comment on what will going to come in the budget, whether the duties are going to be re looked at, whether they’re going to allow cotton to come in or you know, other fibers to come in. I think it all waits to be. We’ll have to wait to see what is going to happen.
But currently that if you look at the volumes with respect to Bangladesh plus one we really don’t see that the volumes have significantly come down as far as our yarn going into Bangladesh is concerned. Bangladesh is one of a very large customer, very large market for Indian yarn. China plus one we have been actually it is almost for 2021 to now three years and still things have really not moved as much as what we’ve expected because of its own structurally we need to have large capacities to counter China plus one and perhaps similarly with respect to Bangladesh plus one as well.
Both of it would happen only if the raw material makes raw material price has to be reasonable and I think there’s lot of industry associations which are making that pitch at the right to the government I suppose. So there are challenges there as to when the investment cycle will pick up and it is down to these factors. And if you see within, for example in South, Tamil Nadu for example there is a electricity charge which the cost of electricity going up is definitely a bit of a challenge. But again we have maintained that the current scenario with a lot of PLI schemes, PM Mitra parks, the Gujarat policy or whatever the policies of various state governments, for example, I think we are whatever could be done to the best of abilities has already been announced and been out there. It is perhaps the challenges on perhaps something like raw material getting addressed that would trigger the demand. That is point number one.
Point number two. Again if you go back and see we are talking about non profitable spindles having reduced. So what is the running spindles are running full at full capacity. So if you look at mills today it is not that mills are running at lesser utilization mills. The most of the customers are running at full utilization. Probably the margins what they’re making are not very comfortable. There has been a loss which has happened in the past which of course they will have to recover. So the capacity utilization is to a very large extent it is happening. So this would certain spindles going onto the market would also help in that utilization part. And when there’s a pickup it would definitely come back Again. What we have learned post Covid is V and K and W growths. But we definitely feel we can’t judge or we can’t comment as to what kind of a pickup would we see something.
What we see in 2020 late post Covid where all of a sudden there was a huge uptick in demand because all again since I said one and a half years there has been a slowdown whether it is going to all of a sudden come back. That is these are all things which we can’t predict. But we do know that these scenarios do exist, right? What our government has done with all the schemes like I already mentioned are already in place. So few factors turning around would help. Now come this is with respect to India now we are also having similar challenges and globally, right.
We are talking about Bangladesh, which has a foreign currency issue. Shipments are still happening, products are still getting shipped. But of course they do have a foreign currency issue. Turkey has got an interest rate issue. So today, if you speak to Turkish customers, I mean, their logic is that government is backing up. It’s a very high interest they give. Even bank deposits, we understand from our customers, gives you 40% interest. So their point is, why wouldn’t we? Because the inflation is so high and things like that. So the point, what they ask is, why would you want to invest when we can keep the money in the bank and get a higher interest rate? And government is trying to have that, you know, back up those internal banks.
So their point is, why would I want to run and make 10% when I can keep it in the bank and make more interest than that? So there are certain issues there, but at the same time, certain new markets are growing. African market to some extent is starting to grow. So predominantly we do have an issue across the globe as far as textiles are concerned. And it is very difficult to judge considering the fact that now with Trump’s new set of what do you call these tariffs going to be announced, we really have to wait and see as to how these things are going to change.
The textile, the demand from various manufacturing hubs, I think that would be with respect to the textile machinery division, with respect to CNC machinery manufacturing. The CNC machinery generally, yes. What your observation is right, it is not an account of any slippage of customers pushing out deliveries. We generally in CNC business don’t have too long a waiting period. It is one and a half months of order book is what we at any point of time hold. It is more to do with a slight slowdown in the industry and there was a dip.
But again, if you go back last two years and see it would be pretty much similar dip in the third quarter, followed again by an uptick in the fourth quarter. So, but the trajectory of continued growth as far as this segment is concerned is very clear for us. We are not anticipating any significant dip because here China plus one has really taken off quite well. I would say there is a lot of things happening, especially on the engineering side from the manufacturing side in India. So we are positive that the long term trajectory still stays. Quarterly dip really doesn’t matter significantly for us.
With respect to the advanced technology Center, I think the question was very clear as to whether we are part of the domestic defense segment and what has been structurally the changes. And if you actually go back and see our numbers, for us we were making a consistent loss and we have taken a clear call that we would like to focus more on the international customers where the strategy for us is to go deep and expand their spend with us. So that is the change what has happened over last couple of years and that is where the turnaround specifically has happened with this sector. So sorry for this division.
So currently we still do 90% of our business only on the export side. But point taken and noted that with respect to the defense, we do work with defense, domestic defense companies as well, but still a smaller percentage. But over a period of time, yes, it will grow. We will be investing and as what is required. As you know we have got both composite and metallics business in this. So we will be trying to focus more and more for composite business also towards the domestic defense and see how that works. But currently over the last three years we kind of, we have restructured to cater to the international customers than the local defense segment.
With respect to MRO, the idea is to supply components, parts, etc. Not to get into an MRO business. That’s a totally different business altogether. We are not focusing on getting into MRO of maintenance of aircrafts and things like that. I hope I have answered the question. Back to you. Mr. Sameer. I think he’s still. Yeah, he’s got some follow up question it looks like. Yeah.
Operator
Sure sir, sure.
Nirav Vasa
Yeah. Hi sir. Thank you. Yeah, Nirav here. Sir, thank you very much for this detailed explanation. So basically sir, in defense what I was trying to understand is that like when an engine is getting designed you need to get into the ecosystem, get the customer at the designing phase itself. If you want to scale up the advanced technical center. And gradually when these engines start getting into the rollout phase and when the MRO activities come, that is where we become the exclusive supplier. So are we in any kind of an what I would say as we are trying to turn around this ATC center, have we got any significant breakthroughs with any of the global names? Because they are also looking at India as a very strong alternative from the sourcing perspective.
And with regards to the machine tool division, wanted to understand can we get into like four XL5XL machines? Because that is where as we are seeing the EMS division, even EMS companies are setting up really mega capexes and they require these kind of machines on a very larger scale. And one more question which is specifically pertaining to machine tools. We are going to see massive capex of semiconductors in India. Are we trying to have kind of any kind of a joint venture or any kind of an activity to address that particular market segment considering our technical understanding in the machineries? Thank you.
V Senthil
Okay. I think with respect to the long term contract on atc, right. I mean you are right. There’s a possibility for a company to participate in the development phase. But what then happens is that you are looking at iterative design development phases which with a very long lead time, right. Our focus today is basically to be not in that segment because then what happens is we are investing a ton of time, ton of money and then it’s going to take a long time for us to get back our [Technical Issues]
Nirav Vasa
Unable to hear anything.
Operator
I just wanted to confirm if Senthil sir is visible or audible to…
Nirav Vasa
No, his line is lost. His line is lost.
Operator
Got it, got it. I just confirmed the same with the technical support who has joined us.
Nirav Vasa
Thank you.
Operator
I just wanted to confirm that, you know…
Nirav Vasa
I could not get anything from — I could not get anything from the second conversation that was started.
Operator
Sure. We’ll just inform Senthil sir that, you know, this has happened once we have him connected to the call again. Senthil sir, sorry to barge in and interrupt. So we lost you for the couple of, you know, like last minute, I guess.
Nirav Vasa
Entire conversation was missed.
V Senthil
Okay, I’ll just repeat that. See what I meant was. What I was trying to say is that the, our. The strategy, what we have adopted is to be part of the existing running programs of the customers, OEM customers. Not to get into a new program with international customers. Because that, because of the lead time, you know, and the amount we’ll have to spend just to be part of that entire program. Rather, we. We are keen to partner with them, work with them, expand our production, expand our offer to them. And then at some point, perhaps we should look at this.
But having said that, from the Indian context, we are part of the GTRE where I think you can look up that information which is available online as well, where the development. GTRE development, the engine development of gtre. We are part of it. That is the way ATC works.
Now coming to the EMS segment, yes. And we are 100% in line with what you mentioned, Mr. Nirav, that the manufacturing requirements in India are going to be very large scale. And we have developed machines for ems. We are supplying machines for EMS segment as well. And we are not giving, we are not in any way taken away the. The scope of our supply for, for the EMS segment, but with semiconductor segment. No, we are not making any machines for the semiconductor segment at the moment. And perhaps if that is, if we do that, we’ll definitely keep you informed once we start. They’re launching these products. But at the moment semiconductor is not part of our profile of missions. What missions can go into and be supplied to. I think. I hope I answered your questions.
Nirav Vasa
Thank you very much.
V Senthil
Yeah. Back to you, Mr. Sameer.
Operator
Sir, thank you so much for answering that one. Thank you so much. We would once again like to request the people in the attendees to please raise their hands to go ahead with the question. So at the moment we do not have any hands raised. Now we do. We have Mr. Manish Goyal joining us. Manish ji, you have already been unmuted and if you feel like joining the call with the video turned on, you can do that as well. The option is now enabled.
Manish Goyal
Thank you so much. Very good evening, Mr. Senthil, hope you can hear me.
V Senthil
Yes, yes Mr. Manish, I can hear you very much.
Manish Goyal
Yeah, thank you so much sir. On the TMD side, sir, if you can also probably give perspective as to. What I recollect is that in last call we did mention that we are seeing some sequential improvement in order inflows. So if you can probably give more perspective as to is the trend continuing and at least we are able to book orders equivalent to the revenues booked. Or how is the scenario and number one and number two, within that are we seeing any project based orders or it is largely from unitary machines? That was one thing. One first question.
Second question, what is the export order book? So like what you mentioned about LMW Global of 280 crores, is it the export order book or it’s a separate from the subsidiary that wanted to know. And third, on the clarification on the revenue breakup you mentioned 71% for domestic and so on. It’s for quarter three or it was for nine months because this number is very similar to quarter two numbers. So just wanted to clarify on that aspect. These are the first three questions on the tmd. And maybe if you can also give perspective as to how is the progress on the launch of our new product Auto Krona as well. I have question for machine tool. I’ll probably come back on that.
V Senthil
Okay. From the order book perspective it is not improved. Are we replacing enough orders from the new orders ordering flow? No, what we are getting executed is basically coming out of the existing order book. And the new orders are not replacing the order in flow, not replaced by the new order inflow. The export order book of 280 crores is exclusive of the 2,300 crores because that is pure Indian order book. And now with this LMW Global which you have established we are. All the orders of exports are under this subsidiary which is the LMW Global. And that is excluding the. Nothing to do with the 2300 crores which I already mentioned.
And with respect to the ratio, this ratio is a nine month ratio. It’s a cumulative ratio for nine months with 71%, 7% and 22% is a cumulative ratio.
Manish Goyal
So it is basically very similar to what quarter two was.
V Senthil
Actually. Yes, you’re. You’re absolutely right. I think what is. And that’s what I was mentioning when I was answering Mr. Nirav in the previous question as well generally as what you know, you know we do 50, 25, 25 or something similar to that. The export order order books, countries where we are supplying the order books are really gone down and the supplies have got pushed out more than the order book. It is. I think the supply pushouts have happened and that is. That is what is. It is reflecting in. In the. In. In this ratio.
And the autocona, yes, there will be some supplies for. In the. I think by end of this year, this quarter. Basically. I think there will be some supplies will be there. I think there will be a launch and things like that. We will let you know. I think definitely next quarter we’ll let you know how many missions got supplied. But it will be a limited launch somewhere in few specific markets. It will be and you will come to know as soon as we launch it. But yes, there are some missions rolling out in the current quarter.
Manish Goyal
Right now, what would be the market size for autoconar? In past it used to be almost thousand crore per annum.
V Senthil
I mean in a weak market like what we see today, even in this market it would be. I think we just internally myself and Madam Dhanalakshmi we’re just looking at the numbers. Even in a weak market like this we will be closer to 600 crores. So in a good market definitely it will be 1200, 2500 odd crores Definitely, I think…
Manish Goyal
Sorry, how much in a good market? How much sir?
V Senthil
In a market like this, definitely 600 to 700 crores. In a good market definitely 1200 to 1200 crores is what I would say it is. But it will start rolling out this quarter thing. Missions have been rolled out to customers. Yes.
Manish Goyal
That’s quite interesting, sir. And on the machine tool like. Sir, again just wanted to get a perspective as to are we still seeing slowdown from the auto sector? Because last quarter you mentioned that auto sector contribution has almost reached 40% while non auto engineering segment is doing quite well and is growing. So how is the scenario right now? Are we probably seeing any improvement in the. In the demand side, number one?
Number two, on the margin side sir, like it continues to remain quite depressed. So how do you see it going forward? Also in perspective that now there has been further rupee depreciation and there has been quite a lot of imports for machine tool. So how do we probably look forward to improving margins? Is it possibility that we can probably take price hikes to compensate for the cost increase? How should we one look at it sir?
V Senthil
Any other question, Mr. Manish on ATC. So I thought I’ll take it down if it’s okay.
Manish Goyal
No sir, in ATC just want to know probably like how is the order book? It used to be 300 to 400 crores. So just want to know how is the order book building up and do we expect execution to improve in ATC going forward?
V Senthil
Okay. With respect to the segment, the auto segment again I’m talking about nine month period now. The auto segment is now closer to 45% followed by General engineering, industrial machinery, pump and valve tool room electronics. I think that’s the way it is of course made up of many things but auto segment has actually gone up by around 5% compared to last time. The margins, with respect to margins I think the there are three things within this margin when you look at this number right.
One is there is a foundry which is 11% foundry and that foundry because of the lower overall lower capacity utilization there is, it is just below breakeven rate. So that is also part of this. But on a standalone basis we should also understand that now VMCs which are part of the mission tool business they are at little bit of a lower margin because of the right thing, what you mentioned the costs are increasing. Most of it is imported components. We are not looking at any price hikes because we have done a price hike in the month of May 2020. So at the moment we are not looking at any price hikes as far as the segment is concerned.
Only requirement. What we are trying, what we are pushing for is that and we have already committed our capex and we have actually spent the capex on this division for closer to 200 crores of turnover and our capacity utilization has to go up. I mean it’s a very simple, a straightforward mathematics where we are, we are pushing for better utilization of the plant and higher turnover from the this particular division because having expect expected a surge post China plus one and lot of manufacturing coming into India we have all, most of the, most of us in this particular business have taken a call that things are going to look better and we have invested but we are not getting that numbers.
I think that is the reason we are seeing a little bit of a dampener on the margin side. But otherwise yeah I think we should see margins improve as the turnover goes up. With respect to the currency, we have seen currency depreciate in the recent past. We are keeping an eye on it because it does have a direct impact on our product cost. But this would be an industry wide phenomenon and we will take a call appropriately when it comes to that when this update and we sit and discuss as to what happens with the future pricing of the components.
With respect to order book. Yes the order book pretty much the same range around 400 odd crores over the next two and a half years. As far as ATC is concerned with respect to the execution part there is still a little bit of an uncertainty with respect to the order book. I would say more of a 15, 20% kind of uncertainty in all the orders getting executed because these are all order books are slotted at various points in time. We do get a vis for next two and a half years with the existing order book. But because of the push and pull of these orders from the customer side we are certain with almost 80 to 85% certainty we are clear of exhibiting these orders. That’s with respect to ATC but the order book is building up in ATC. Thank you. Back to you Mr. Sameer.
Operator
Thank you so much sir. Mr. Manish, I believe he has got another follow up question. Can we proceed with him?
V Senthil
Yeah, please.
Manish Goyal
Sir, I just want to clarify you mentioned in MTD, have we done 200 crores of capex which can offer us 1000 crore revenue?
V Senthil
I said 1200 crores of revenue as possible with the Capex what we have already done over the last three years. That’s what I meant.
Manish Goyal
Okay. Okay. Thank you sir. I’ll come back in the queue. Thank you sir.
V Senthil
Thank you. Thank you. Thank you.
Operator
Thank you so much sir for clearing that one. Thank you so much. We would request more of the attendees if you have any questions you can have your hands raised. We’ve got Mr. Aditya. Aditya, we have already connected you to the audio. You have already been unmuted. We can also have your video turned on if you like.
Aditya
Am I audible?
Operator
Yes sir.
V Senthil
Yes, Mr. Aditya. Please go on.
Aditya
Yeah. So sir, my first question was on the ATC division. So if you could just help us understand what kind of products do we provide to international OEMs and what is the end use of these products. And secondly sir, if we look from a three to four year perspective, you know what would help this business grow to a 300, 400 end of a turnover. So do we need to get new OEMs or we can increase the market share from the existing OEMs only and we can help scale to a 300, 400 turnover. So if you could just provide some qualitative aspects what would lead to the turnover increasing two or three times in this division.
Then second was on MTT division. Now we were in talks with, you know, Apple to get into their manufacturing division to give supply machines to their manufacturing partners. So what is the status of that? If you could just help us understand that. And are we in talks with any other to major OEMs like Samsung and all to provide our machines to some of the manufacturing partners.
V Senthil
Okay, see with respect to ATC what we have, what the company has done is we have got six verticals, right? We make engine parts, we make structural parts, we make sheet metal, we make special process, we have assembly and tooling and we have composite of which the predominant business, the turnover comes from engine parts, composites and the other, the structural sheet metal are all smaller ones.
Now our existing Capex, what we already invested so far would in itself give us closer to 200 crores of turnover. Ah plus we should also understand that at least 40%, 30 to 40% of the turnover is basically coming out of pure value add. Nothing to do with material cost because we get free share of material especially the entire supply of the OPLF for the PSLV that is the no scone assembly which you have done and supplied if you see was at zero material cost to us with pure value addition being done.
So the way we look at the business is that see for me to get to 300 crores, if I were to simply buy the material, I’ll still make 300 crores. But the idea basically is that we need to have a mix of free shift material because in this particular business the material purchase has longer lead times because the materials are all controlled by the customer as to where it should be procured from, etc. The idea is to have both a mix of value add alone plus a mix of width material. So get. But doing that getting to a higher turnover. We don’t see much of new capex getting required because like I said we have got capex to existing capex will get us to 200 odd crores.
But we are also working on having youthful utilization on the composite facility. Today our composites generate closer to 15 to 20% of the turnover. But with respect to where they can go to from currently where we are on composite we are at let us say around 20 odd crores of turnover. In the current turnover for the nine months they technically can on its own come to around 80, 90 crores. So we are pushing for utilization on the composites and in this process of reaching 300 or 400 crore there are like I just mentioned, one way to do it and the pay, what we kind of prefer is to work with the OEMs and get into more and more parts for them. Right.
It is not about going to newer OEMs and trying to establish but an existing. Because these, these are all as, as you know, very large OEMs having a variety of parts for us. And we ourselves are structured like I just now mentioned, under the six verticals. So any part in an OEM we’ll be able, I mean we’ll be able to produce and supply. So be it a special process, be it a sheet metal requirement, be it an assembly requirement, you know, that is the way we are kind of structured to grow the business very much.
We believe that this is, this would be the way to do that, take oem, expand the scope of our supply to the OEM and that way get more and more parts from them. And investments may not be very huge. And they’re all project based. So we get as the OEM starts, wants us to produce more and get gives a specific order. We try to then procure and go into capex. And whilst keeping all this in mind we are also very conscious of the fact that we don’t commit any capex to a specific customer where the asset is non fungible. Right. So that asset has to be fungible enough for us to produce a similar part or some other part for a different customer. Because this business it is. Things are clear. But if there’s a push out all of a sudden you don’t want to be stuck with that asset and just be dedicated in that case that’s what, that’s what it is.
With respect to the machine tool division, I did mention that the project for the EMS machine, what you are basically talking about, EMS machine, we call it the JD one is one of the models and there’s a series of models for the EMS segment we are supplying. I think as we speak there is a large exhibition which is happening in Bangalore. It is called imtex. I think at the end of it we will know what more new customers have come in to pick up these machines. But yes, we are actively pursuing this segment also. And there’s a lot of demand.
You are absolutely right. When a supply chain, when the segment gets established it is not only the product in itself but there are toolings which get supplied to the product. There are other machines which have to get manufactured to make this product. So there is a whole ecosystem which gets created and we are very much part of the ecosystem of supply into the EMS segment. I hope that answers your question. Back to you Mr. Sameer.
Operator
Sir, thank you so much for answering that one. Thank you so much. Sir, at the moment we once again have no raised hands. We would once again request the people in the attendees to please raise your hands. I think Mr. Aditya has a follow up question.
V Senthil
Sure.
Aditya
Yeah. Hi sir, I have two follow ups. So in that ATC division what is the construct you know currently like? So how many OEMs would be currently supplying to and how concentrated it is? So is it like we are the 70 to 80% of our revenue comes from 2 to 3 OEMs or it is pretty diversified currently. And secondly on the machine tools my question was have we got approval from Apple or. We are still in the process of negotiating with them. And if I look at, if I look at your listed peers as well in MTD division you mentioned that there is some slowdown in MTD division. But you know when I look at the two listed peers in the MDD division, their growth has been pretty, pretty fast as compared to us. So is it just related to the industry or we are absent in some of the segments and which is hampering our growth. So if you just clarify on that, that would be helpful.
V Senthil
Yeah. See ATC we are concentrated with probably 60 to 70% from couple of fourth. Probably few. Few. I wouldn’t say couple which would mean two but at least few OEMs. I think that is the way. That is the way it is. With respect to machine tool division, the machine as far as we have initially discussed on the project it is approved but however having said that the orders were placed and of course we did not get the order for the first set of machines which was placed but that’s what I mentioned also that that machine what we have developed for the EMS segment is something which is being supplied to the ecosystem within the EMS segment. I think that is. That’s what it is. So did we get a direct order from the customer? No, we did not get a direct order from the customer.
With respect to the listed peers and the growth, I mean we can’t comment. Only thing what I can say is that with respect to the RV is present in all segments. That is definitely the effort. As what you can see the mission pool division is split into the segments. At least what we are. Right. I don’t want to go from the overall segment but at least within the CNC mission segment it is turning centers and missioning centers. Whilst we are as significant player on the turning centers, missioning centers has been a growth story for us over the last three, four years because our missioning centers, both vertical and horizontal and more so on the vertical side have only started last three years and we are making a reasonable amount of progress as far as missioning centers are concerned.
So our focus is on missioning centers, turning centers. We have been there, we are there and you know with a fairly significant, significant market share in the turning center. So there is a growth opportunity for us on the missioning centers which is both vertical and horizontal and that is where we need to grow. And that is where the investments also keep going into. Back to you, Mr. Sameer.
Operator
Thank you so much sir. Thank you so much. Sir, with this I believe we have no more raised hands and hence we have no further questions.
V Senthil
Good. And do we then wind up?
Operator
Hello sir, would you want me to wait a little further for more questions or would you want us to conclude this meeting?
V Senthil
Yeah, probably. We can wait for a minute and then we can wind up then.
Operator
Sure sir, sure. So for all the people in the attendees, we would like to wait for another minute so that we have any questions or follow ups on the questions. We can have the hands raised. So Mr. Manish has a follow up question.
V Senthil
Yep.
Operator
Mr. Manish, we are ready for you.
Manish Goyal
Yeah, thank you so much for giving opportunity. Sir, I have one question on the spares business. So sir, you did mention that the, the mills which are operating are operating at full capacity. So ideally just want to know that the spares business is also seeing a significant decline despite if machines are operating at mills are operating at full capacity. So what is it that is probably hurting the growth in the spares business and how should we look at it going forward?
V Senthil
Actually Manish, the spares, domestic spares at least has not seen significant declines. Very, very marginal. Right. For us of course to some extent, you know, there is information that some amount of spindleage have come down and which I also mentioned initially, probably that is the only impact. But otherwise even if you look at our own numbers, and I’m sure you have the numbers of the last years as well, and if you look at, if you convert the percentage to value, it is not significantly reduced, it is still there.
What basically happens is that as what we always see, you know, in a market like this, when the margins are very tight, the long life spares, the spindles and etc. Probably get pushed out little bit more instead of working for six months further where they may say okay, can we push it for one more year? You know, already today have been closer to the end of the life but they may still be able to push it for a few more quarters to to ensure that at least they are cash positive and things like that. But that that has been the scenario. We don’t. We have not seen a significant dip as far as spares are concerned.
Manish Goyal
Okay thank you so much.
V Senthil
Thank you.
Operator
Thank you so much sir for answering that. Thank you so much sir.
V Senthil
Okay I think there are no other raised hands Mr. Sameer then we can close it.
Operator
Sure sir. Since we have no raised hands this brings us to the end of all of the questions from all of the attendees. Thank you so much everybody for joining us and especially thank you so much Senthil sir for answering all of the questions asked through the entire of the meeting. Thank you so much sir. Thank you.
V Senthil
Thank you. Bye bye everyone. Thank you.