Ok Play India Ltd (NSE:OKPLA) Q3 FY23 Earnings Concall dated Feb. 14, 2023.
Corporate Participants:
Rishab Handa — Executive Director & Chief Financial Officer
Analysts:
Sumeet Maru — Kirin Advisors — Analyst
Sandeep Dixit — Arjav Partners — Analyst
Vivek Sahni — Individual Investor — Analyst
Yashwanti Khedkar — Private Investor — Analyst
Himani Oban — Suraj Research — Analyst
Vaibhav Shah — Cogent Research — Analyst
Ankur Gulati — Private Investor — Analyst
Presentation:
Operator
Ladies and gentlemen. Good day and welcome to the Q3 FY’ 23 Results Conference Call of OK Play IndiaLimited, hosted by Kirin Advisors Private Limited. [Operator Instructions] There will be an opportunity for you to ask questions after the presentation concludes. [Operator Instructions]
I now hand the conference over to Mr. Sumeet Maru from Kirin Advisors. Thank you and over to you sir.
Sumeet Maru — Kirin Advisors — Analyst
Thank you. Good afternoon. everyone. I would like to welcome Mr. Rajan Handa, Managing Director of Okay Play India Limited, Mr. Rishab Handa, Executive Director & CFO. As this is the first call from the company, we will have brief introduction about the business model of the company, then Q3 results highlight and followed by Q&A.
Now, I hand over call to Mr. Rishab Handa for a brief introduction about the company. Mr. Rishad Handa, over to you sir.
Rishab Handa — Executive Director & Chief Financial Officer
Good afternoon, everyone. This is Rishabh Handa, Executive Director and CFO of OK Play India. So like — I would just like to summarize and give an overview of the company. We are a public limited company started in 1989 by the name of Aquapure Container Pvt. Ltd. The intent of the company at that point was to do overhead water storage tanks.
Very soon our MD realized that he wanted to venture into more of higher quality moulded products and we started with toys in 1992. We had acquired a company OK Play which was based out of UK, London and at that point, it had about five to six SKUs with them. That — the company was bought and renamed as OK Play India Limited. In 1994, we had successfully done our IPO.
The company started with the toys segment, and today primarily has three business segments. First being toys, school furniture and outdoor play equipments. The second being automotive components, wherein we largely do plastic fuel tanks for the heavy commercial vehicle segment. And third in 2015, we had ventured into electric vehicles, primarily on the three-wheeler platform. So, meaning the electric rikshaws, electric autos, where we are the OEMs and we sell directly to the B2B as well as the B2C market.
Talking about the toys briefly, we had — OK Play today is anonymous and one of the oldest players in the toys space. We have started with manufacturing a lot of higher quality products. With the recent developments that have taken place in the toys space, there has been a lot of interest coming up now. So in — on 1st April, 2020, the government has introduced the BIS norms in the toys which is basically soft target by the Indian government to stop Chinese imports from coming into India, owing to the low-quality products that were earlier coming in.
And this market previously was dominated by the Chinese. So it was very difficult for a company like us to compete with the Chinese in terms of the pricing as well as the volume, et cetera, that they do. But owing to the BIS norms, this has opened up for us now as a company and earlier the 95% plus market, which was dominated by the Chinese stores have opened up, so it’s a huge opportunity both domestically, as well as internationally.
If I talk about some major developments in the toy space, we have signed up with one of the largest toy manufacturers in the world recently to do contract manufacturing for this part of the world, wherein we will be supplying to the Middle East market, the Chinese market, the Australian market, as well as serving the Indian market.
Second, we have also tied up with one of the largest players in India to do — to sell our branded toys, which is OK Play as well as doing the contract manufacturing for them as well.
Talking, in 2003 to 2004, we ventured into the automotive space. So we today have a portfolio of multiple products, largely being water molded with 85% plus share coming from plastic fuel tanks. Today, we are seeing single-source suppliers to one of the largest customers, which is Ashok Leyland, in this space. We also have a majority share with Volvo, Eicher and we are in talks with one of the largest automotive companies now to supply plastic fuel tanks to them as well.
This EV market has — since ’18, ’19, which was when it had reached its peak, it has seen a downturn. So this was one year prior to COVID and then of course during COVID it had gone down significantly in terms of volumes. But now we see the market picking up in a very good way. In fact, this year we would be contributing — we would be doing a higher share than what we had achieved in FY ’19 in this EV space.
Talking a little bit about the EV segment, we have started — we ventured into the electric vehicle space back in 2015. This was when a lot of electric rikshaws had been introduced in the market, wherein they were no quality norms, et cetera, that were being — people were importing it in a CTD form from China and selling it here.
So being in the automotive space, having a good presence and a good experience working with OEMs as well as tier one vendors in automotive components space, we thought that we should try and organize this market and launch our own electric vehicle, which with of course plastic being the highlight.
So even though the three business segments, it has nothing in particular in common, but what is common is the process of molding of plastic, which is where our specialty lie, which is largely a rotational molding, as well as some bit of blow and injection molding.
In the electric vehicle space, as we speak today, we are — we have pretty well-established network of dealers, and we are also targeting the B2B space wherein we work directly with logistics company, as well as a lot of e-commerce companies to cater to their last mile deliveries.
This is a brief overview about the three business segments. If there are any questions in particular, I’ll be happy to answer that.
Questions and Answers:
Operator
Thank you. We will now begin with the question-and-answer session. [Operator Instructions] The first question is from the line of Sandeep Dixit from Arjav Partners. Please go ahead.
Sandeep Dixit — Arjav Partners — Analyst
All right. Thanks for your time. I mean, I’m not very familiar with the company, so I just needed a little bit of a background. If I look at the numbers from, let’s say, March 2011 till about March 2016, 2017, the revenues were reasonably range-bound between INR60 crores and INR100 crores. Something happened between March ’17 and March ’19, and it went from INR79 crores to INR153 crores [Phonetic] And then unfortunately we had the two COVID years and now as I see the numbers, we are back to the high growth part of about — trailing 12 months is about INR170 crores. Can you — is it possible for you to give me some color on what’s happening on the revenue front? Is there something materially strategically which has changed in the company? Hello?
Rishab Handa — Executive Director & Chief Financial Officer
Yeah. So like I said, the company initially wasn’t largely into the segments, one being the automotive component space, and the second being the toys space. And this year, we are seeing quantum jumping both the sectors. So if I — if you’ve been following the CV [Phonetic] market space, you will know that it was — it could be down one year prior to COVID. So this was start of 2020 till last year, which is now picking up. So as you can — it’s our sale in the automotive space is pretty much proportional to how the CV market performs, and largely customers like Ashok Leyland, Tata, Volvo Eicher, because we do — 85% of our automotive spaces into fuel tanks.
So the CV market has picked up significantly this year and hence our numbers have picked up on that site. Secondly, on the toys side, like I said that we were all initially institutional payer. We did a lot of institutional oriented products, meaning largely catering to schools, pre-schools, daycare, creche. But now with the Chinese ban coming in and the market opening up for us domestically as well as internationally, we have launched a lot of new retail-oriented products as well. So in the toy space, now we have ventured into the general trade market, into the modern trade market selling to the likes of families, FirstCry, Toys”R”Us and other companies as well as now expanding our export market as well which is a huge, huge potential for us. So, the numbers have doubled up on the toy space as well and hence you see the revenue growth coming in FY’23.
Sandeep Dixit — Arjav Partners — Analyst
That’s extremely helpful. Thanks. How much of the total revenues coming from toys division right now?
Rishab Handa — Executive Director & Chief Financial Officer
So this year about INR45 crores to INR50 crores is contributed by toys and the remaining is contributed by the automotive space.
Sandeep Dixit — Arjav Partners — Analyst
Okay. Are you sharing any guidance on either revenues or margins going forward? Any further targets?
Rishab Handa — Executive Director & Chief Financial Officer
Yeah. So the company has one subsidiary, which is OK Play Auto and there is the other main company which houses both the businesses, which is the toys sector as well as automotive component sector. We do track both businesses separately, but we do not post numbers separately in the public domain.
Sandeep Dixit — Arjav Partners — Analyst
Okay. Any sense which is — I mean I’m just trying to understand what is the dynamics, what is going to move in the period.
Rishab Handa — Executive Director & Chief Financial Officer
So see, I can you a broader perspective going down the line, like you — like they said that this year we should be closing at about INR170 crores plus. And going forward, both the automotive space, which is the CV market, as well as the toy space, is expected to grow. In the CV space, the industry is cyclic in nature and since it was down in the last three years, three to four years are looking pretty good on that side as well. In the toy space, we’re expecting quantum growth coming in. Like I said that we have doubled in terms of revenue from FY ’22 to FY ’23 and this is expected to grow at this current rate going forward in the next four to five years as well.
Sandeep Dixit — Arjav Partners — Analyst
Great. Just one last thing on this particular part. From what I understand, you are — large part of this growth will come from subcontracting or other outsourcing business. Would you be able to sustain a 20% plus margin on this incremental business?
Rishab Handa — Executive Director & Chief Financial Officer
Mostly the toys — in the toy space, we are adopting both strategies, one is selling under our own brand name, we being one of the oldest, we have very strong brand recall value in the market. So one part that we are anyways going on since beginning is selling under our own brand name. Second, of course, would be contract manufacturing, for the likes of families or other companies wherein good volumes expected, but yes, the margins would be slightly lower than what it would be on the branded space. However, on a sustainable — I mean toys is pretty attractive looking margin business and even if we consolidate both parts of the business as we should be working at pretty healthy EBITDA margins.
Sandeep Dixit — Arjav Partners — Analyst
Okay. And just one last question from me. Any plans for capex because if you’re projecting 100% growth rate in toys for the next three to four years, where do you stand in terms of capacity utilizations?
Rishab Handa — Executive Director & Chief Financial Officer
Yeah. So we would be looking at expanding our capacities in the toy space as well as the automotive space. So in the automotive space, like I’ve mentioned that we are in talks with the largest customers. So we are looking at setting up a plant close to their facilities. So there’ll be some capital requirement coming in that front. And secondly on the toy space, the government has recently also introduced the PLI scheme wherein we would be participating in one of the slabs, which requires a substantial amount of investment, which substantial amount you also get back within the next three to four years.
Sandeep Dixit — Arjav Partners — Analyst
Is there a number in terms of capex? Would it be in the range of INR150 crores — INR150 crores, INR200 crores? Any number?
Rishab Handa — Executive Director & Chief Financial Officer
About [Phonetic] INR100 crores to INR125 crores.
Sandeep Dixit — Arjav Partners — Analyst
INR100 crores to INR125 crores. Spread out over the next two years? Or will it be front ended?
Rishab Handa — Executive Director & Chief Financial Officer
So this will be over the next three to four years.
Sandeep Dixit — Arjav Partners — Analyst
Okay. Thank you. That’s it from me for now. Thank you so much.
Operator
Thank you. The next question is from the line of Vivek Sahni, an Individual Investor. Please go ahead.
Vivek Sahni — Individual Investor — Analyst
Yeah, hi, thanks for the opportunity. I think you had very well explained about the auto components and the growth — possible guidance on the growth on the toys part. But I would like to understand what’s happening in the EV segment? Because as you have also mentioned, there is no bifurcation of revenue which the company has generated from EV and auto and your toys part? So any number there? And what is the growth projection in the EV segment? how is it doing? I mean I want to understand that.
Rishab Handa — Executive Director & Chief Financial Officer
So, on the electric vehicles segment, I’d like to give you a little background. So we have started in 2015, and like I mentioned at that time, the market was flooded by the Chinese rickshaws coming in. So every person whether manufacturer or so called manufacturer, if I may say like an assembler was venturing into this segment, that is when we had also ventured and started selling. At that point, we had made a decent network of about 85 to 100 dealers and sold about 4,000 to 5,000 of these vehicles but what had been a drawback for us at that point was the batteries.
So this is something that we were not doing, we were simply buying from other companies and putting it in our product and selling it and eventually the batteries degraded and did not perform up to the level expected. Hence, we had taken a back-step then and reworked the business model and about three to four months back, we have now again started expanding with both the electric rickshaw as one offering and second is electric auto, which is the L5 platform.
So as we speak today, we have decent network of dealers, it would take some time to expand back to those — the previous numbers, but we are very confident on this front of the business now because we have worked out all the limitations that we had faced before. Especially on the battery front, we have been working with the likes of very reputed companies on the battery front and having warranties et cetera completely backed by them.
So and — now if you see the overall market in terms of the EV space, I see three-wheelers personally being the low-hanging fruit, it already has majority share. So about 65% to 66% of the entire three-wheeler market today is electric and it would be factored in the numbers of the LCD [Phonetic] which is the electric rickshaw market also, the market is huge. So we are looking at having about a 10% to 12% market-share in the electric three-wheeler space in the next three to four years.
Vivek Sahni — Individual Investor — Analyst
Sure. Sure. At present, what is the percentage of revenue which is coming from EV segment?
Rishab Handa — Executive Director & Chief Financial Officer
So at present it is negligible, because like I said that we have just started with our marketing and setting up the sales network in the past two to three months only, so as of now, it is negligible.
Vivek Sahni — Individual Investor — Analyst
Sure. And another thing, you are planning for raising capital. So is it for the same purpose which was answered by you in the last section for expense [Phonetic]
Rishab Handa — Executive Director & Chief Financial Officer
Yeah. So see, in the latest vehicle space, we have invested quite a lot in terms of even the capex and there is not — and the business model that we have is outlaid now does not require any substantial amount of capex in the electric vehicle space, maybe a little bit in the research and development side, but that also we have done quite a bit and where we are today in terms of our products being certified, verified electric auto, both on the passenger front as well as the loader front is certified. We have a portfolio of about 12 variants on the LTD [Phonetic] front. So I don’t think a substantial amount of capex would be required on that side. The capex that would be — that I mentioned would largely go into the toy space and automotive component space in the next three to four years.
Vivek Sahni — Individual Investor — Analyst
Sure. Will promoters be also participating in the fundraising round?
Rishab Handa — Executive Director & Chief Financial Officer
Yes, we may.
Vivek Sahni — Individual Investor — Analyst
Okay. Sir, my last question, though, it was discussed in the previous question also, any guidance in terms of you said that the growth has doubled in the toys segment, which is very impressive and you said that the margins would be very — it may not be ’24 as what shown in this quarter, but it would be very healthy margins. So by healthy, can you — will it be more than 20% on a consistent basis?
Rishab Handa — Executive Director & Chief Financial Officer
Yes, you can consider it to be more than 20%.
Vivek Sahni — Individual Investor — Analyst
Okay, great, great. Thanks a lot. Thanks a lot for your time.
Rishab Handa — Executive Director & Chief Financial Officer
Absolutely. Thank you.
Operator
Thank you. The next question is from the line of Yashwanti Khedkar, an individual investor. Please go ahead.
Yashwanti Khedkar — Private Investor — Analyst
Yeah, thank you, this is Yashwanti Khedkar. Sir, I just wanted to understand the more on the industrial side, we are present in two segments, one is toy and the plastic furniture, mainly made for the kids. And again, you talk about automotive segment, mainly is that the EV or rickshaw segment. So can you please help us understand what is the toys segment in India we can see? And how it is growing if you can give industry perspective about the segments?
Rishab Handa — Executive Director & Chief Financial Officer
So ma’am, on the toy side, I can tell you conservatively the market is about INR15,000 to INR18,000 crores in India but what is surprising, is that the organized market here is very low compared to the entire market sales, so I would say exact numbers are not there, because it’s highly, highly unorganized and the government now especially, the good part is that the Indian government is intervening in this and has very aggressive plans to organize this complete market. Hence, they’re coming out with a lot of toy clusters in different states of the country and they are promoting export, they have increased duties recently from 60% to 70%, they have introduced the BS norms. So all those developments that have happened recently has given a boost to the Indian toy industry, in fact, we have now become net exporters, we had always been net importers and as of this year, we would be net exporters, wherein we had exported about $315 million plus of good, even though the Indian toy market today contributes, I would say about 0.4 — 0.5% of the overall toy market, I see it as good growth opportunity largely because the share is so low at the moment and because the country in general has such a high young population. So I think we’re in the right segment with that respect and we are expanding both domestically and internationally in this space.
Yashwanti Khedkar — Private Investor — Analyst
Okay. Is it possible for us to quantify this capacity in terms of numbers, especially for the toy segment?
Rishab Handa — Executive Director & Chief Financial Officer
Sorry, come again please?
Yashwanti Khedkar — Private Investor — Analyst
I just want to understand, is it possible for us to quantify the capacity in terms of numbers? So how we how we do it in terms of numbers, in terms of that turns how do you calculate their capacity? And when you talk about the capacity extension [Speech Overlap]
Rishab Handa — Executive Director & Chief Financial Officer
In the toys space, there is not one specific process or one specific type of machine that we use. We’re into toys where we do smaller toys which are injection molded, blow molded and do the larger toys which are rotational molded and we do play school furniture which is plastic, wooden metal, so that’s a different infrastructure altogether. So I mean — and with the investment that I had just mentioned previously, we would be having sufficient capacities to meet our projected top lines as well as the growth plans in the next two to three years.
Yashwanti Khedkar — Private Investor — Analyst
Sir, this investment will be getting more and more self-funding [Phonetic] model?
Rishab Handa — Executive Director & Chief Financial Officer
So the investment would largely be into the infrastructure, which is the machines and the tools, which is the mold, and some part of it going into marketing.
Yashwanti Khedkar — Private Investor — Analyst
Okay. And do we need to import those machinery or is it here only available?
Rishab Handa — Executive Director & Chief Financial Officer
No, no. So all of this is available in India today.
Yashwanti Khedkar — Private Investor — Analyst
All in one. Okay. So then, you just mentioned that we will be having the government making up lots of toys, I mean, toy making clustered franchise. So are you part of that cluster? Or this is just some positive element of it.
Rishab Handa — Executive Director & Chief Financial Officer
Yes. We are, in fact, our company is working very closely with the Indian government to outlay the PLI scheme also. So it is in the final stages now. It will be announced in next two to three months and you will see that there are certain slabs in that PLI scheme and we will be participating in a slab but there is a considerable amount of investment that we will be doing, which would largely be setting up these — setting up a plant in one of these toy clusters.
Yashwanti Khedkar — Private Investor — Analyst
Okay. Sir, and I just wanted to understand from competition perspective apart from this handling and also when we are doing the contract with them. Also anybody in the organized market, which means they would be our very close competitor? [Speech Overlap]
Rishab Handa — Executive Director & Chief Financial Officer
You see, there are — no, so in India also, there are a few companies now which are — which I would call organized and which are now attaining some good scale also but competition is always healthy, so that’s actually a good thing for us that people are venturing into this and taking it up in organized way. However, these companies are pure contract manufacturers. So there are very few companies, I think probably Funskool, being another company which is in the branded player, but very few companies who are both in the branded player as well as in the other contract manufacturing player.
Yashwanti Khedkar — Private Investor — Analyst
Okay, sir. And to compare with them, our competitor strength will be our quality?
Rishab Handa — Executive Director & Chief Financial Officer
So you see, I mean, largely, the market is today, also doing very low-quality products. So, since the time that we’ve been in this space, which is more than 25, 28 years now, what we have been able to do is achieve a very loyal — niche, but a very loyal customer-base for our high-quality products and I think now with the market growing and the Indian consumer, also being smart about getting into buying high-quality products for their children, I think there’s a good potential there and people are realizing the importance of this and hence the demand for these premium quality products has gone up.
Yashwanti Khedkar — Private Investor — Analyst
Okay. Sir, is it in the toy market we can say that we have some product SKUs?
Rishab Handa — Executive Director & Chief Financial Officer
So, in the toys space, we would be having about 75 to 80 different SKUs today and every month we are launching about 2 to 3 new SKUs now.
Yashwanti Khedkar — Private Investor — Analyst
Okay, And that is completely indigenously slow?
Rishab Handa — Executive Director & Chief Financial Officer
Yes.
Yashwanti Khedkar — Private Investor — Analyst
And one more question on the EV side, you say that EV rickshaw auto, the market is gaining momentum. Sir, is it possible for us to like how was the market and how — where it is headed for in terms of — either in terms of number or in terms of the value? If you can just help us understand?
Rishab Handa — Executive Director & Chief Financial Officer
You see, today, if I talk about the three-wheeler space, India currently is registering about 30,000 to 35,000 vehicles a month. So it’s anyways about — I would say about INR400 to INR500 crore market per month today in the electric three-wheeler space and this is only the one which is there on the VAHAN portal. That’s where we take the data from. But there are lot of other unregistered vehicles also being sold today, which I would assume as probably same or more than the organized, the registered vehicle market. So the market is definitely there and it is growing a lot and especially on the three-wheeler space considering the fact that already the majority of the three-wheelers are electric today, speaks volumes of the acceptability of this product. So hence I would personally say that by 2025 or so, 100% of this market should be electric.
Yashwanti Khedkar — Private Investor — Analyst
Okay. Okay. And sir, you mentioned about the batteries now that is available now in the market in the past few years and that has been resolved. So, we have this — call it, like we have those tie-ups or we have a collaborative agreement with those battery manufacturers and how we work with them?
Rishab Handa — Executive Director & Chief Financial Officer
So we have tie-ups with multiple, not just with one and on the battery space also, there are different models coming up. There are fixed batteries being offered in different sizes in terms of kilowatt hour, then there are swappable batteries being offered. People are entering into lithium-ion batteries. So there are different sorts, different types and we have tie-ups for all types. So when we are doing a product offering, we offer all options to the customer, for example, you can buy a lead-acid battery, which is a fixed battery for vehicle which may be cheaper, but then it gives you a lesser range etc. Secondly, you can opt for lithium-ion battery on the swappable front wherein the cost of the upfront vehicle comes down because there is no initial investment in the battery. It’s more of paying for what you use model, so it’s capex to opex model on that battery front, but here the question is not about the business model, because that’s already accepted today in the market, the issue that we had faced initially was the battery is not being able to perform, which I think now the companies in India have done a tremendous job on that front and we’re seeing that whatever that they are seeing in terms of warranties of performance is actually happening. So we’re very confident on this market going up again for us now.
Yashwanti Khedkar — Private Investor — Analyst
Any plan to enter in the battery business, sir?
Rishab Handa — Executive Director & Chief Financial Officer
Sorry, come again please.
Yashwanti Khedkar — Private Investor — Analyst
Any plans to venture into the battery business also? [Speech Overlap]
Rishab Handa — Executive Director & Chief Financial Officer
No. No. No. That’s different business altogether, we have no plans to do that.
Yashwanti Khedkar — Private Investor — Analyst
Okay. Sir, my last question, as we are in the plastic furniture and everything depends on oil prices as there are few raw material, do you — and we are earning a margin of around 20%, 25%. So is there any side effect or any impact on oil prices fluctuation or volatility, which is currently there?
Rishab Handa — Executive Director & Chief Financial Officer
No. So, see on the automotive space, we work on a pure cost-plus basis with all OEMs, so even if there is a increase in the crisis of raw material, we are compensated with it and in the toy space, anyways we’re working on very healthy margins. But even if there is a change being our own brand, etc., we are always free to change our pricing.
Yashwanti Khedkar — Private Investor — Analyst
Okay. Sir, and there is lot of gung-ho about using the recycled plastics. So is there any way that in the future, we are shifting to the recycled plastics? Is there anything coming up?
Rishab Handa — Executive Director & Chief Financial Officer
The plastic that we use is non-toxic. It’s food grade plastic, it’s UV-resistant. So it could be easily shared.
Yashwanti Khedkar — Private Investor — Analyst
Okay. Okay sir. Thank you so much for your explanation and making me understand the company wish you all the best for future.
Rishab Handa — Executive Director & Chief Financial Officer
Thank you. Thank you so much.
Operator
The next question is from the line of Himani Oban from Suraj Research [Phonetic} Please go ahead.
Himani Oban — Suraj Research — Analyst
Hello, good afternoon, sir.
Rishab Handa — Executive Director & Chief Financial Officer
Good afternoon.
Himani Oban — Suraj Research — Analyst
Sir, please throw some light on competition with China in toy industry.
Yashwanti Khedkar — Private Investor — Analyst
So ma’am, like I mentioned, this was the case before but it’s no longer the case because with the BS norms being implemented, today, there are no Chinese toys, which are accredited with the ISI mark, so hence it’s illegal to import toys without the BS certification.
Rishab Handa — Executive Director & Chief Financial Officer
So today as we speak Chinese toys imports are not happening in the country.
Himani Oban — Suraj Research — Analyst
Okay. And how is the demand shaping up in the next few years due to slowdown in the economy?
Rishab Handa — Executive Director & Chief Financial Officer
So I think toys is something which is agnostic to this, it’s keeping in mind that the market which was earlier dominated by other countries has opened up even if the economy slows down a little bit, the growth in this segment will always be there. So I mean, this can be seen even from our own performance. We have doubled up in terms of our revenue from last year to this year. And with these recent developments that I had mentioned and with our recent tie-ups with the big players, both domestically, as well as internationally, we’re expecting a pretty robust growth in this segment.
Himani Oban — Suraj Research — Analyst
Okay. Again, sir, what are business strategies of growth?
Rishab Handa — Executive Director & Chief Financial Officer
So we have I mean outlaid clear plan, keeping in mind, all our different business segments. If I talk about the automotive space, we are already suppliers to the top three customers in the medium and heavy commercial vehicle space and there is the fourth customer, which we are in advanced stages of starting business with them. Secondly, on the toys space, I have mentioned our plans going forward, both on the branded side as well as on the contract manufacturing side and things are looking pretty good there as well. We have already done some significant tie-ups and some are in the process of closing out because these are large companies of vendor on-boarding, etc., takes time. But both businesses are looking good in terms of growth now.
Himani Oban — Suraj Research — Analyst
Okay. And then sir, my last question is, do we have institutional sales for the toys segment? How much do you — do your top-five customers contribute?
Rishab Handa — Executive Director & Chief Financial Officer
So when ma’am, we get started initially, the — we had — in fact the intent of the company was to do institutional oriented products and today also the majority of our share is institutional oriented product, but now if I look at the numbers coming up, seeing FY ’24, this would change significantly, wherein I think retail side as well as the contract manufacturing side would have a higher share compared to the institutional oriented products. But as on today, I would say it’s about 50% — 55% to 60%.
Himani Oban — Suraj Research — Analyst
Thank you. Okay, thank you so much sir. All the best.
Rishab Handa — Executive Director & Chief Financial Officer
Thank you.
Operator
Thank you. [Operator Instructions] The next question is from the line of Vaibhav Shah from Cogent Research.Please go ahead.
Vaibhav Shah — Cogent Research — Analyst
Yeah. Thank you for the opportunity and congrats on the good set of numbers. So I just wanted to understand, we do things about the company. First of all, total number of SKUs that is around 75 to 80 and you are introducing around two to three SKUs every month. So overall, how is the development process? And what will be the overall development time for one product from the design to coming into the production?
Rishab Handa — Executive Director & Chief Financial Officer
So we have our own design team and our own rule-making department. So that is actually one strength of our company. So from inception to designing to prototyping to actually converting it into a mold is not a very lengthy process for us, because everything is in-house. But on this side also there are — I mean, there is a different approach. So if you’re talking from branded play side and depending upon the size of the toy and depending upon the features, etc., that you want, the time may vary a lot. So I can’t give any kind of indication in terms of one specific timeline or doing one product, it depends from product to product. Secondly, on the contract manufacturing side, a lot of companies have approached us with their own designs, etc., and we simply defy the tetra ready So then we just simply have to convert it into a tool. For example with Reliance, with Hamleys we do contract manufacturing based on their designs. So it depends entirely from company to company and what kind of toy we are doing.
Vaibhav Shah — Cogent Research — Analyst
Okay. So on your branded product, what will be the average pricing for your toys?
Rishab Handa — Executive Director & Chief Financial Officer
So, see our toys start from INR400, INR100 rupees and go up till lakhs of rupees, because the outdoor play equipment that we do, you must have seen those big-trait equipments which are installed at bigger schools or builders etc., we do those as well, which is rotomolded plastic with metal component, etc., so those run into lakhs of rupees. So there is no fixed average SKU as such.
Vaibhav Shah — Cogent Research — Analyst
For the indoors, smaller toys and all, like you can see on that side….
Rishab Handa — Executive Director & Chief Financial Officer
INR2,000 to INR3,000 rupees.
Vaibhav Shah — Cogent Research — Analyst
INR2,000 to INR3,000 is the average prices.
Rishab Handa — Executive Director & Chief Financial Officer
Yeah, so this will be — probably so, see — we should see this in terms of the product types, the segments rather than the entire portfolio like for example, write-downs would be INR2,000 to INR3,000, slides would be INR6,000 to INR7,000, so it all depends on what product category or range you’re talking about.
Vaibhav Shah — Cogent Research — Analyst
Okay, okay. So when we talk about the toys like Ride-Ons and there is various sports toys and all, so they are ranging from INR400 to INR500, is it correct?
Rishab Handa — Executive Director & Chief Financial Officer
Yeah, you could say that.
Vaibhav Shah — Cogent Research — Analyst
Okay, okay. So just to add on this, for the contract manufacturing part, how it works? And because it’s a totally — you just do a manufacturing or you provide any insights or totally the piles that all molds and everything will be given by the [Speech Overlap]
Rishab Handa — Executive Director & Chief Financial Officer
So it depends, it depends from customer to customer. See we would be doing anything that is required and that is in our view to satisfy the customer. So for example if a particular customer has his own designs, we can simply mold the product for them and based on certain MOQs, we can sell to them. If the customer is wanting us to give option to be — like I said, we have our own design team. So we do give options as well. So we work very closely with our customer in terms of whatever he — the customer wants. Now with these companies coming up, like for example, companies like FirstCry, Amazon coming up in the private labels. All these companies are wanting to venture into the toy space and do a lot of private labels for their brand. And this is a new market for them, because earlier it was — they were not so keen like how they ought to be. So we do pitch in and do offer our suggestions as well because we do have a good knowledge in terms of what is accepted today in the Indian market.
Vaibhav Shah — Cogent Research — Analyst
Okay, okay. And for the — our own branded products, so you have online, offline model or the — how does it work?
Rishab Handa — Executive Director & Chief Financial Officer
We have both models. So we sell through three to four different channels, one being the dealer channel. We sell through distributors we sell through the online channel. We sell through general trade, we sell through modern trade.
Vaibhav Shah — Cogent Research — Analyst
Okay, okay. So on the dealer distribution front, or how many dealers with network we would be ready?
Rishab Handa — Executive Director & Chief Financial Officer
About 100.
Vaibhav Shah — Cogent Research — Analyst
And their products are available at pan-India level.
Rishab Handa — Executive Director & Chief Financial Officer
Yes.
Vaibhav Shah — Cogent Research — Analyst
Okay. So roughly if you can give us idea, how many in touch points your product will be available?
Rishab Handa — Executive Director & Chief Financial Officer
So see the 100 distributors I think sell probably to about 1,500 to 2,000 retailers from very small retailers to the bigger retailers as well. And then they also sell directly to B2B institutions like schools, or daycares.
Vaibhav Shah — Cogent Research — Analyst
Okay.
Rishab Handa — Executive Director & Chief Financial Officer
I would put it this way that today if you visit any school in India, I’m sure they will be carrying up some of our products.
Vaibhav Shah — Cogent Research — Analyst
Got it. Got it. So, when we bifurcate the online and offline, so how much will be — it will be coming from the online and how much [Speech Overlap]
Rishab Handa — Executive Director & Chief Financial Officer
Largely the market is — largely today the market is offline but we expect this also to change significantly because the new products that we’re doing which are more detail oriented and owing to its size, etc., they are more apt to be sold online. So we expect this to change significantly in the upcoming years.
Vaibhav Shah — Cogent Research — Analyst
Okay. Okay. So and now on automotive front, so we’re solely providing plastic there, right?
Rishab Handa — Executive Director & Chief Financial Officer
Yes.
Vaibhav Shah — Cogent Research — Analyst
Okay, okay. And this is for the passenger vehicle?
Rishab Handa — Executive Director & Chief Financial Officer
No, this is for the CV, the commercial vehicles.
Vaibhav Shah — Cogent Research — Analyst
Only commercial vehicles. Okay. Okay. Okay. Got it.
Rishab Handa — Executive Director & Chief Financial Officer
And primarily MHC, which is medium and heavy commercial vehicle.
Vaibhav Shah — Cogent Research — Analyst
Okay, okay, okay. So what will be the breakup between this toys and this storage — petrol tank?
Rishab Handa — Executive Director & Chief Financial Officer
So, you are asking for the breakup between automotive components in the toys business?
Vaibhav Shah — Cogent Research — Analyst
Yes, yes, yes.
Rishab Handa — Executive Director & Chief Financial Officer
As you know, like I said, this year, about 65% to 70% is automotive components, 30% just toys.
Vaibhav Shah — Cogent Research — Analyst
Okay. Okay.
Rishab Handa — Executive Director & Chief Financial Officer
As on this year.
Vaibhav Shah — Cogent Research — Analyst
And one last question. Currently we are doing contract manufacturing for the how many clients? Any number?
Rishab Handa — Executive Director & Chief Financial Officer
So I’m not allowed to disclose the names.
Vaibhav Shah — Cogent Research — Analyst
Sir, I don’t want names.
Rishab Handa — Executive Director & Chief Financial Officer
But we are doing it for multiple today and we’re in talks with many more for starting this process.
Vaibhav Shah — Cogent Research — Analyst
Okay, okay. And you also mentioned you’re going for the exports also. So have we started doing exports or we are in plan?
Rishab Handa — Executive Director & Chief Financial Officer
We have already started.
Vaibhav Shah — Cogent Research — Analyst
So, in export, are you facing any competition from China? And when compared to them? So what will be the price difference and or it’s [Speech Overlap]
Rishab Handa — Executive Director & Chief Financial Officer
One thing we realized like how in a subtle way, the Indian Government is moving away from China and reducing lines on them, other countries are also doing or following a similar strategy. So big groups, for example, like Walmart and others also are looking at alternative sources. I wouldn’t say they’re wanting to move all out, obviously, but they are wanting to kind of derisk themselves, so pricing is not the only factor here. There are multiple other factors also but yeah, if I talk about pricing in particular with the PLI scheme coming in and the Indian Government supporting us in other ways, I think we will be very, very competitive with China.
Vaibhav Shah — Cogent Research — Analyst
Okay, okay, okay. And our primary raw material will be HDP
Rishab Handa — Executive Director & Chief Financial Officer
We do all sorts of raw materials, we do engineered — we do a lot of Engineered Plastics, we do LDHD, I mean, a lot of other engineered crutch as well.
Vaibhav Shah — Cogent Research — Analyst
Okay. Okay. And are you we using like new technology 3D printing or something for for the toy manufacturing? 3D printing or something like that or it’s totally rotomolded and this is on the products?
Rishab Handa — Executive Director & Chief Financial Officer
These are all creator. Rotomolded also blow an injection, molded also, but we do not do 3D printing as of now, if required, we do have the infrastructure to get better.
Vaibhav Shah — Cogent Research — Analyst
Okay. Okay. Thank you so much. All the best.
Rishab Handa — Executive Director & Chief Financial Officer
Thank you.
Operator
Thank you. [Operator Instructions] The next question is from the line of Sandeep Dixit from Arjav Partners. Please go ahead.
Sandeep Dixit — Arjav Partners — Analyst
Hi, it’s me back again. I just wanted to understand the funding of this capex you indicated INR125 odd crores, then the issue that you have — you’ll be launching, right? Can you share any details on the size and stuff like that?
Rishab Handa — Executive Director & Chief Financial Officer
So we would be looking at the businesses like I mentioned, the INR100 crores, to INR125 crores is over a span of three to four years, depending on how much is required at what stage for every business of ours, and we are in talks with several funds plus our own bankers at the moment to raise these funds as and when required.
Sandeep Dixit — Arjav Partners — Analyst
So the notice that was given to the exchange today about a preferential issue of shares or am I mistaken?
Rishab Handa — Executive Director & Chief Financial Officer
So that, we will give you more details on that once the Board meeting is announced.
Sandeep Dixit — Arjav Partners — Analyst
Okay. The other thing is, in response to the earlier participant, did you mention split of revenues as 35 between toys and auto?
Rishab Handa — Executive Director & Chief Financial Officer
Yes, as on today this year, it’s 35 and 65 [Phonetic]
Sandeep Dixit — Arjav Partners — Analyst
And autos and toys are going at like 100% per annum over the next three to four years as you have said earlier, am I right?
Rishab Handa — Executive Director & Chief Financial Officer
We could say that, yes.
Sandeep Dixit — Arjav Partners — Analyst
Thank you. Thank you. Those are my questions.
Operator
Thank you. The next question is from the line of Ankur Gulati, an Individual Investor. Please go ahead.
Ankur Gulati — Private Investor — Analyst
Thanks. Really appreciate you guys. Good evening all. Quick question. I was going through a bund of documents on your website. I think this is from 2020 document perhaps that says you were targeting $50 million from your automotive business in 2023. So roll-forward, of course, two years of COVID gone but any views on that $50 million revenue target.
Rishab Handa — Executive Director & Chief Financial Officer
So, see on the automotive side, 80% to 85% of our business is on the fuel tanks side and — which in the MHCV segment today, the top four customers, mainly Tata, Mahindra, Volvo Eicher, and Ashok Leyland dominate the market. We already work with three of them very closely and we are in talks with the fourth customer. And if we are able to back that auto, then we should be doing the number that we had mentioned on the automotive side as well.
Ankur Gulati — Private Investor — Analyst
Okay. you can potentially hit 15, right?
Rishab Handa — Executive Director & Chief Financial Officer
Absolutely. And now apart from the fuel tank side, we’re also venturing into the non-automotive side, for example, we’re doing — we are working the work with windmill companies to do plastic parts for them, so covers, plastic covers, consoles, rack, consoles, all that type of material, so basically our expertise lie in converting anything which is seen fiber, metal to plastic owing to its characteristics, being lightweight, being more durable, no rust — no rusting etc., so it makes — it makes sense for this industry to venture into it.
Ankur Gulati — Private Investor — Analyst
Conceptually looking five years forward, I mean commercial heavy vehicles of EV pickup, than fuel tank ma become a bit obsolete, so any views?
Rishab Handa — Executive Director & Chief Financial Officer
So I — eventually it is going to happen, but I don’t see it happening in the next five years for sure. If you — if you look at the West today, it has not happened there. So, here I mean, we’re pretty far away at the moment. And the tanks that we do a lot, the smaller one are not for the passenger vehicle, it’s the larger ones. So it’s like 40-tonners etc. So we would need to set-up a very extensive infrastructure, especially the charging infrastructure, if you’re looking at doing these heavy electric trucks. So, I think we have a pretty long way to that as of now.
Ankur Gulati — Private Investor — Analyst
Understood. And sometime in FY ’22 Annual Report it was written that RIRA new vehicles, there was some sort of a slump sale or something. Can just elaborate more on that, what was the transaction?
Rishab Handa — Executive Director & Chief Financial Officer
So RIRA is where the electric vehicle businesses house. And today we have separated that into the subsidiary altogether. So we can track the performance and keep that business separate from other businesses. So hence there was a slump sale from the – the parent company, where the electric vehicle business was — were not transferred to this subsidiary.
Ankur Gulati — Private Investor — Analyst
And the fund raise, I mean, will you plan to raise separately funds for EV vehicle in that subsi or you’re still at a control (speech overlap)?
Rishab Handa — Executive Director & Chief Financial Officer
Yeah, it will — it will probably be individually in that subsidiary, but like I said, as of now, we are not looking at raising funds for the EV side. We already have — we’re on the stage that we’re at, at the moment, we don’t require much to expand now.
Ankur Gulati — Private Investor — Analyst
Then financial year ’22, some of your inventory days are north of 600, so any views there. Was it mostly COVID or anything?
Rishab Handa — Executive Director & Chief Financial Officer
I think this was largely clouded because of the EV side. So, you know, a lot of parts earlier that we were doing, not just us, but any other company in particular were being imported. The major part of the vehicle, like the motor, the differential, the control etc., is being imported. And so we have a lot of stock of these parts sitting with us and hence the inventory days are high. But we see it as three different business segments, the working capital is relatively low, auto on the parts side.
Operator
Thank you. [Operator Instructions]. As there are no further questions, I would now like to hand the conference over to Mr. Sumeet Maru from Kirin Advisors Private Limited. Over to you sir.
Sumeet Maru — Kirin Advisors — Analyst
Thank you. Thank you everyone for joining the conference call of OK Play India Limited. If you have any queries, you can write us at research@kirinadvisors.com. Once more thank you, everyone, for joining the conference.
Operator
[Operator Closing Remarks].