Styrenix Performance Materials Ltd (NSE: STYRENIX) Q1 2026 Earnings Call dated Aug. 14, 2025
Corporate Participants:
Unidentified Speaker
Bhupesh P. Porwal — Chief Financial Officer
Rahul R. Agrawal — Managing Director
Chintan Doshi — Company Secretary and Compliance Officer
Analysts:
Unidentified Participant
Aditya Khetan — Analyst
Aashish Upganlawar — Analyst
Kalash Jain — Analyst
Dattatreya Chitnis — Analyst
Priyank Chheda — Analyst
Tushar — Analyst
Radha Agarwalla — Analyst
Santosh Keshri — Analyst
Rahul Agarwal — Analyst
Pratik Singhania — Analyst
Krunal Shah — Analyst
Pawan — Analyst
Presentation:
operator
Ladies and gentlemen, good day and welcome to the Styrenix Performance Materials Limited QNFI 26 earnings conference call. We have with us today from the management of Styrenex Performance Materialist Ltd. Mr. Rahul Agarwal, Managing Director. Mr. Bhupesh Porwal, Chief Financial Officer and Mr. Chintan Doshi, Manager, Legal and Company Secretary. As a reminder, all participant lines will be in the listen only mode and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing Star then zero on your touchstone phone.
Please note that this conference has been recorded further on behalf of the management of the company. We would also like to remind the participants that this call has been conducted subject to and in line with the disclaimer mentioned in the investor presentation as in available on the stock exchange. I now hand the conference over to Mr. Bhupesh Porwal. Thank you. And over to you sir.
Bhupesh P. Porwal — Chief Financial Officer
Yeah. Thank you very much. Ladies and gentlemen. Namaste everyone. I am pleased to welcome you to our Q1 June 25th conference call. As we reflect on our performance in Q1 of FY26, I am delighted to announce that we had witnessed a good demand of our products in this quarter. Our expansion plan is going as per schedule mentioned in the last investor presentation. We will update if there are changes in the plan. The debottlenecking exercise announced in October 23rd has also been completed as announced in the last investor call and also mentioned in the presentation. Coming on to our financial performance, Q1FY26 highlights.
Sales volume of Q1 was 51.8km versus 48.1km in Q4FY25 that is increased by 8.1%. Revenue stood by 721cr in Q1FY26 versus 701cr in Q4F25 that is an increase by 2.85% and an increase by 3.1% compared to Q1FY25. That which was 700 crores PBDIT stood. At 86.1 cr, that is 11.9% versus 83cr, 10.8% in Q4FY25 and 92.2 cr that is 13.2% in Q1FY24 PAT stood at 54.9 cr in Q1, that is 7.6% versus 53.3.2 cr, 7.58% in Q4FY25 for the consolidated Q1FY26 highlights Sales volume for Q1 was 67.2kt versus 64kt in Q4FY25 that is it has increased by 5%. Revenue stood at 943.5 cr in Q1 versus 939.7 which is an increase by half a percent 0.5%. PVDIT stood at 99.8 crores versus 89.9 cr which is 10.6% and 9.6% respectively. PAT stood at 51.9 cr in Q1 that is 5.5% versus 56.2 cr 6% in Q4FY25.
The company has acquired Standex Performance Materials Thailand Limited in January 25 only and the consolidated results for the quarter ended 30 June 25 includes financial results of subsidiaries in the previous corresponding quarter. The company did not have subsidiaries therefore only stand alone Financial statements were prepared according the previous corresponding quarter. Figures presented in the consolidated financial statements are derived from the standalone financial statements of the company and are not comparable with the current year consolidated figures. As you all know, we had incorporated an special purpose vehicle in Thailand for acquisition of the target company as the purpose of that SPV is completed.
So now that has been merged with our Target Company on 26th of June 25th. This is all about highlights of the quarter ended June 25th and now we. May proceed to answer the questions you may have. Thank you very much.
Questions and Answers:
operator
Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press STAR and one on their touchstone telephone. If you wish to remove yourself from the question queue, you may press STAR and two participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. We take the first question from the line of Aditya Khetan from Smith Institutional Equities. Please proceed.
Aditya Khetan
Thank you sir for the opportunity. Sir, my first question is so during the quarter we had witnessed a notable decline in the realizations and the gross and EBITDA spreads also have declined. Is this related to lower product mix or the market spreads of both the products PS and ABS have itself declined.
Rahul R. Agrawal
Can you ask all your questions at once?
Aditya Khetan
Yes. So my second question so I missed on the volumes part of the Thailand. I meant I think you mentioned on the consolidated volumes I missed on that answer. My third question is so what is the ramp up we are looking in Thailand for this fiscal and for the next year and sir, like and the fourth question is so when we look at the standalone business, it is near operating at peak utilization levels. Although you mentioned in your presentation regarding the weak outlook in the second quarter because of the lower volumes in two wheeler passenger vehicles and also into the stationary business.
So how you feel like volumes will evolve over the next couple of quarters and apart from the ramp up of Thailand, which are the other, which are the growth triggers we are looking at, are we looking at another inorganic acquisition and what is the outlook for the business?
Rahul R. Agrawal
Hi Aditya. Thank you. So in terms of realization for the quarter, it’s very much in line with what we see in Q1 every year. Typically you know, it’s a little bit higher but this year we had a little bit of slowdown because of early monsoon and therefore the uptake that you would normally expect in household appliances, consumer durables, that was a little bit lower. However we were able to still do higher volumes. As we’ve already mentioned, the volumes in India we did close to around 51,000 tonnes which is the highest sales ever done by the company.
So in terms of volumes we have grown which is close to 8.5% over the previous quarter and also similarly the similar quarter next last year as well. In terms of realizations, yes, there is a bit of a product mix which also has changed. And fundamentally as we know we work on certain spreads. So those spreads might have also moved on account of raw materials. And while our margins remain intact, those would have impacted us as well. Volumes in Thailand, I think I’ve already mentioned was mentioned by our CFO. The consolidated volumes are about 67. So we did about roughly 16, 17,000 tons in Thailand.
The balance is in India. In terms of ramp up in Thailand, we are still operating at fairly kind of low utilization levels in Thailand. So there is a significant scope for us to increase volumes. It has been only five months that we have taken over this business. In accordance with trying to increase the capacity utilization, we have embarked on a significant sales strategy which we have outlined in our investor presentation. What we have done in terms of opening offices across Asia. We do believe there is a good situation where we will be able to realize additional volumes.
It’s a little bit early to specify what those increases will be in the next few quarters. But definitely we do believe that over the course of next year or two we will see additional volumes coming in from Thailand. So for the current business, the Indian business, yes, I had mentioned that there is a bit of a slowdown again because of early monsoon in some sectors. We have witnessed that. But we do believe that this will get corrected over the course of the year and on an annualized basis. We are still on track to to meet our targets.
Aditya Khetan
Sir, onto the inorganic acquisition, anything is lined up?
Rahul R. Agrawal
No, we can’t, we cannot speculate on that right now, so I would refrain from answering that question.
Aditya Khetan
Got it. Sir. Just one follow up sir, onto the Thailand, as you mentioned, so 16, 17,000 tons, it looks almost similar compared to last quarter. So this ramp up, I believe you mentioned that it could be taking some time. So is it because of some structural issues in the production which is limiting the uptick in volumes or the demand itself has come down, which is why we are operating at this year.
Rahul R. Agrawal
So in Thailand there are multiple challenges when we have taken over the business. We have also had to go back to several customers with revalidating our brand. As you know earlier, the earlier company was operating under a different brand. We are operating under our own brand. So all those changes are taking place with different customers across Asia. As you know, we supply into China, Japan, within Thailand as well into Korea, Vietnam, South Korea. So several geographies and there is a significant effort involved in revalidating some of the products at times and also reaching out to those customers, ensuring that they understand who we are in terms of the product profile and also in terms of the confidence which has to be built across those customers.
So it’s a question of time. We are quite sure with all the efforts we have put in place that will happen. But like I mentioned already, it may take some time.
Aditya Khetan
Got it. Thank you sir, I’ll join back in.
operator
Thank you. We take the next question from the line of Ashish from InvestQ PMS. Please proceed.
Aashish Upganlawar
Yes, thank you for the opportunity. So sir, you mentioned in the initial remarks that we will meet our annualized targets despite Q1 being soft due to seasonal factors. So what would be the target this year given the demand scenario and is it too difficult in terms of. Because automobiles, we see numbers being soft in consumer durables, we see it to be solved. So how as an entity, we plan to grow this year.
Rahul R. Agrawal
Any other questions, Ashish?
Aashish Upganlawar
Yeah, second question would be on the Thailand integration. Where have we progressed? You mentioned a lot on the qualitative aspect earlier. But how will the profitability trajectory move in this business and the utilization? Any color on that will be helpful. How long or where have we reached on the curve? Actually. That’S it from my.
Rahul R. Agrawal
Targets, I think we have mentioned in terms of what volumes we are targeting across the business and I do believe that, you know, in spite of whatever gaps there May be we are still on track to achieve those volumes on an annualized basis. In fact, the first quarter itself, while there might have been some kind of low uptake in certain segments, our volumes are still very much on track. So we have still achieved close to 51,52,000 tons of product, which is the highest sales the company has ever achieved. We do believe on an annualized basis also, in spite of low demand in certain areas, we will still be able to cover for it and still be able to achieve our target of the entire volumes.
So I think this has been outlined earlier and I believe it is to the order of 10 to 12% additional volume growth over the previous year. So I think we would still be able to achieve that. In terms of talent integration, I think some of the work which has been done by our team has been quite good. We have been able to successfully implement SAP system over there in a short period of time. So in terms of IT controls, that has been done at a good pace. In terms of the overall teams coordination and terms of working which needs to happen in terms of technologies, in terms of process improvements, all of that work is going on.
Profitability for Thailand is difficult to ascertain at this stage. Like I mentioned, a lot of the profitability would depend on the capacity utilization of the asset over there. And that will happen over a period of time. So I do believe that the market opportunity is quite immense. If I look at all the segments that we are supplying to, whether it is the automotive EV segments in China and the rest of Asia, whether it is even the appliances sector in those areas, and given our product profile that we have, which is relatively unique in the area, I do believe that for us to ramp up the capacity should not take too much time.
Aashish Upganlawar
Okay, sir, Anything to share on the ABS spreads in case you have any feelers as to the market overall, how is the spread on the products that we sell? Any comments on that will be helpful actually.
Rahul R. Agrawal
Overall they are in line with what have been historically there, barring certain factors which can influence a month or two. But on an annualized basis, I think we are very much exactly where we have been for the last few years. So that has not changed much.
Aashish Upganlawar
Okay, thank you.
operator
Thank you. We take the next question from the line of Kalash Jain from Alpha Accurate Advisors. Please proceed.
Kalash Jain
Yes, thank you for the opportunity, sir. So just one question. So we have seen a good margin expansion on the Thailand in the Thailand plant. So what is the kind of mix there? And like how do we look at the gross margins going ahead? Is it sustainable or what kind of scope is that in margin expansion? This is the first question and second is just wanted to know that when are these capacities going to come up in which quarter of the next year. So just wanted your view on that.
Rahul R. Agrawal
Thanks Kalash. So in terms of margin expansion in Thailand, again like I mentioned it is a function of capacity utilization. So we will get some operating leverage over there. There are significant fixed costs in Thailand which have to be taken care of today the total volumes that we are producing are selling are lower, much lower than where we can be and we do believe in time that will happen. We do also believe in terms of product profile. We have a very interesting product mix in Thailand and there are of course efforts in order to further improve that product mix as well.
That’s more of a slightly longer term strategy but overall I think currently volume kind of capacity building, capacity utilization being the first and then followed by further product mix optimization will help us in terms of capacity in India. I think we are on track to what we had mentioned earlier. So I think we had mentioned that for the ABS capacity expansion which we are planning, 50% of that would come online in the next financial year and we are very much on track to achieve that.
Kalash Jain
So any, you know, any specific quarter by which the capacity would be online.
Rahul R. Agrawal
So I think again it’s a function of, you know, a lot of moving parts as of now. It’ll be difficult to give exact numbers now because we are still more than a year out right in terms of achieving that expansion in so we are still planning, you know as of now anywhere from 12 to 15 months to achieve that further augmentation capacity but exact number and quarter we can’t ascertain today.
Kalash Jain
Okay, thank you so much sir. All the best.
operator
Thank you. We take the next question from the line of Dattatre an individual investor. Please proceed.
Dattatreya Chitnis
Good afternoon sir and thank you for giving me opportunity.
Rahul R. Agrawal
Yes sir.
Dattatreya Chitnis
I’m the property checkness individual investor.
Rahul R. Agrawal
Yes sir.
Dattatreya Chitnis
Can you hear me sir?
Rahul R. Agrawal
Yes sir, very well sir.
Dattatreya Chitnis
Please convey my RTs. Thanks to board for dividend.
Rahul R. Agrawal
You’re very welcome sir.
Dattatreya Chitnis
I just wanted to know any product mix we are. We are encountering sort of a slowdown in interview in your other segments. Is it you are likely to develop anything for aerospace industry.
Rahul R. Agrawal
So sir, specifically for aerospace we don’t have a, you know, large product profile but we do have certain products which can be used in aerospace or certain blends and that we are already developing. We are already working and we do believe that with the overall product mix that we have between Thailand and India. There will be more opportunities in the future.
Dattatreya Chitnis
So can I suggest as a shareholder that you should go for composite of carbon fiber?
Rahul R. Agrawal
Yes sir.
Dattatreya Chitnis
That would have potential tremendous in the coming years Because I read one report conducted by University of Turkey they found ABS is the most suitable Polymark compared to others and it is reinforced by carbon fiber. And develop a product like that, it will be much better for our company.
Rahul R. Agrawal
Yes sir. We’ll take note of the same sir.
Dattatreya Chitnis
Thank you sir. That’s all. Wish you all the best.
Rahul R. Agrawal
Thank you sir.
operator
Thank you. We take the next question from the line of Priyank from Vellum Capital. Please proceed.
Priyank Chheda
Yeah, hi sir. So again sorry on the capex side last time you had mentioned that by calendar year end you would be adding that 50,000 tons abs capacity. Not sure if that is delayed. My second question is on the India business cost structures. Anything that is there for us to reduce the cost in the coming years or even in this year.
Rahul R. Agrawal
Reduce the cost in Thailand?
Priyank Chheda
No, no, I’m talking about India. Is there any low hanging fruits or anything that can be worked out in India? Are we working on that front to. Reduce the cost in India operations?
Rahul R. Agrawal
Any other questions, Priyan?
Priyank Chheda
No, I am grant. Thank you.
Rahul R. Agrawal
Yeah. So as far as our capex is concerned, as we had outlined in the last investor presentation where we spoke about adding the 50,000 tons additional ADS capacity, this is actually on track. This was planned for next calendar year so I think we are on track to do that and we should be able to accomplish the same. In terms of reducing cost. There are no specific low hanging fruit to our knowledge. But of course as an organization, you know it behooves us to continuously look at possibilities to reduce cost and to become, you know, a little bit more efficient.
So that effort is ongoing and there is continuous effort happening in that direction from all our department.
Priyank Chheda
Thank you sir.
operator
Thank you. We take the next question from the line of Tushar from Omega Portfolio Advisors. Please proceed.
Tushar
Yeah, good afternoon sir and thank you for the opportunity. 140 KTP of Aba and there is additional capacity which is coming on like near to 390km going forward by FY28. Just wanted to know, I think this capacity would be sufficient to fill the existing gap and the upcoming demand. Would you sir, help me out with the high grade ABS as a market share of this quantity and what would be the share of us in that?
Rahul R. Agrawal
I’m sorry, did you say high grade abs?
Tushar
Yes, specialty grid abs.
Rahul R. Agrawal
Yeah. Okay. Yeah. So we do believe, we do Believe that the capacity expanse expansions that we are doing, you know, will obviously help in mitigating some of the imports which are currently taking place into the country. Again, it depends on the entire market dynamic in terms of all the players, how fast and effectively they are able to add capacity into the market to actually determine whether we will be fully, you know, independent or not dependent rather on imports. So that time will tell. We are doing our bit towards that. So we do believe that there will be a healthy balance of capacity and demand over the next two to three years as all the capacities that we have outlined come into play and as well as the other capacity which have been announced.
In terms of specialty ABs, again, we have close to 60 to 70% market, our share of specialty ABs, about 60 to 70% within our total ABS that we sell. And that continues to be the case, I think across the market. That percentage is slightly lower in India and we are operating at slightly higher levels.
Tushar
So just wanted to know, like an offer here in Rajasthan based, any different ABS we sell like in the company?
Rahul R. Agrawal
I’m sorry, I was not very clear. I didn’t get it. Can you please repeat your question?
Tushar
So just comparing with your peer. So in terms of like grade or the specialty, any different ABS you sell in the Indian market?
Rahul R. Agrawal
So I think like we produce specialty abs, some of our peers also produce specialty abs. Of course, like I mentioned earlier, with the addition of Thailand, we have got access to certain product grades which we did not have earlier. And that will help us, you know, expand our, you know, capabilities in being able to service more specialty ABS opportunities as well in India. Other than that, I do believe, yes, there are peers who also have specialty APIs like we do.
Tushar
Fair enough. Sir, just the last question on the ABS alloys, like the blend of PC like PC is not manufactured in India as of now, but going forward, some mechanical players are interested to do that. Do you see that ABS PC blend, a big market going forward for some specialty applications?
Rahul R. Agrawal
Yes. So PCABs, you know, as you know, primarily goes into automotive industry and electronics industry. We do believe as an organization that both these industries will grow, you know, at a robust pace, possibly even exceeding the GDP of the country. So, you know, keeping that in mind, the PC ABS demand will also grow. PCA base also goes into more premium products and there is a premiumization happening across both the sectors. So we do believe that the growth will be robust in that segment. Thank you.
operator
Thank you. We take the next question from the line of Radha from BNK securities. Please proceed.
Radha Agarwalla
Hello sir. Thank you. For the opportunity on the supply side, one of the competitor is adding about 70,000 metric ton capacity of KBS six months. But on the demand side, the user industry demand is muted. So are you witnessing any pricing pressure in ABF or do you foresee to witness any pressure in the near term?
Rahul R. Agrawal
Any other questions? Rajan?
Radha Agarwalla
Yes, the second question will be related to the answer of your first.
Rahul R. Agrawal
Okay, so currently you know, obviously we have not seen the product yet that you have mentioned, but I do believe it will come online very soon. As far as the pricing pressure is there, it is hard to kind of today decide what there will be. We do believe there is sufficient market opportunity. If you look at total imports in the country, there is still a significant portion of imports coming into the country wherein there will always be a preference for domestic locally manufactured products on account of various schemes and incentives also by the government which have been put in place and also the value which is added by domestic manufacturers in terms of overall demand.
If you look in the country, we do believe on an annualized basis that the demand will grow as we have forecasted earlier. So while a specific quarter may have a muted demand, like I mentioned, in this quarter there was some slowdown because of early monsoons in certain segments. But this is only a question of a few months. So this is not going to remain for too long. And we do believe that the demand overall in the whole year will make up for whatever muted demand we see in a few months.
Radha Agarwalla
Sir, actually if 50% of the ABS is still being imported, then is it fair to assume that the import prices are able to match the domestic prices? And if that, then if that is the case, then you know the domestic. A little bit comment on the import versus domestic purposes, then I’ll go ahead.
Rahul R. Agrawal
I’m sorry, can you repeat that question? I didn’t get it, sir.
Radha Agarwalla
I just wanted your commentary on the domestic prices of ABS versus the import prices on abs.
Rahul R. Agrawal
So obviously for certain grades of products there is a parity between imports and domestic products because of the nature of the product being sold globally. However, for many grades and specifically even for the regular products, there is obviously certain additional value which domestic manufacturers offer to customers for which we are able to rely slightly better pricing. And that remains to be the case and has been the case in the past, as you know, that competitive pressure from imports is not something new. It’s something that the company has witnessed for several decades at least in our last three years of taking over management also we have seen it and you know we are where we are and that doesn’t seem to be changing too much.
Radha Agarwalla
So how much ABS will be exported from India?
Rahul R. Agrawal
Almost no abs, very little if any.
Radha Agarwalla
In the Thailand plant in order to bring the EBITDA margin at par with India. Other than operating leverage, what are the measures that you can take to reduce cost?
Rahul R. Agrawal
It’s a little early to comment on that. Rather I think there is many things which have to be done in terms of process efficiency. So I think if we are able to right now just do the operating leverage part, because I think that’s the part which can be done faster, then that is where we will focus on in terms of additional areas of reducing costs. Our team is looking at it, we are working on it, but it will take a little bit of time before we can accomplish it.
Radha Agarwalla
Okay, and the product mix between SAN and ABS in the Thailand market for this quarter.
Rahul R. Agrawal
So we do not disclose that information on account of certain competitive nature of business that we have in Thailand vis a vis our Thailand competitors. So I’m unable to disclose that information to you.
Radha Agarwalla
Okay, so continuing the question that the previous participant asked. In the standalone business, you know, some of the costs like power and fuel Employee 6 Cost per ton is a bit higher compared to the competitor. So. And you’re already operating at optimal utilization. So is there you know, headroom to reduce these three major costs? Any further.
Rahul R. Agrawal
Hedging to reduce power and Fuel.
Radha Agarwalla
Headroom to reduce.
Rahul R. Agrawal
Okay, yeah. So in terms of power and fuel, again we do believe that we have signed by the way an spv, you know, as already is publicly known to go into hybrid power from our current power source. So that I think will be active by the end of the year. So that will reduce our power cost. Also other areas I think there is still some scope but I’m not sure how much you know. So I mean I can’t comment on competitors performance but I think in terms of where we started with the business and where we are at today, there is a significant improvement for sure.
Radha Agarwalla
Okay sir, thanks and all the best.
operator
Thank you. We take the next question from the line of Santosh from Skkhuf. Please proceed.
Santosh Keshri
Hello sir. Thank you so much for giving me an opportunity. So I have two questions. One is that in the presentation you have repeated that the sales to automotive industry is down by 30%. So then it follows that what is the industry wise breakup of your sales. If the sale is down by 30% to automotive industry, what made it up? Because this time this quarter I saw the volume is up quarter on quarter as well as year on year. So what is pulling in the extra demand other than the automotive?
Rahul R. Agrawal
So in our industry presentation as and so we haven’t mentioned about, you know, automotive being down by 30%. In fact air conditioning has been down by about 30% and that again has to do with kind of lower demand due to the early monsoon. The two wheeler in fact has grown and four wheeler also has grown a little bit. So overall what we have seen is there has been other areas where we have been able to sell more product. So in the small appliances for instance, we have done better in some other areas also and we have done better.
So across the board the only area which has lagged really has been the air conditioning and some of the other appliances, larger appliances.
Santosh Keshri
Yeah, sorry, yeah, I got that. The presentation was just on. So yes, it was AC industry. So if in the presentation. Just a suggestion. If industry wide breakup can be given that which all industries picking up the demand, it will be really helpful in terms of US analysts and as the community understand the demand pool that is coming from. So if it can be done, it will be really great.
Rahul R. Agrawal
So generally, you know, if you look at ABS, 40% of the business is in automotive, 40% is in appliances and the 20% is in the other area. Similarly in polystyrene, 40% is appliances, 40% is roughly in packaging and 20% is in the other area. This is a rough breakup that I cannot share with you.
Santosh Keshri
Okay, great. Secondly, sir, my question is that this tariff tantrum that’s happening all over the world, is it going to affect us either from the Indian production or the Italian production?
Rahul R. Agrawal
So from an Indian product, of course we don’t sell directly into the U.S. also, most of our customers that we cater to in India, from what we understand don’t have a huge exposure to the US in terms of exports. So perhaps the Indian operation may not get very heavily impacted. If you look at the Thailand operation also, yes, we are supplying to countries like China and also other areas where the final product might be being sold to the US and there might be some impact of it. But we believe in the context of the market opportunity which exists over there that we will still be fine in order to achieve our target for increasing our capacity utilization.
Santosh Keshri
Okay, great. And just last question. What is the capacity utilization in Thailand? I don’t know if you already would have answered it. If you would have done, I’ll refer to the.
Rahul R. Agrawal
It’s between 50 to 55%.
Santosh Keshri
Okay. So any hope of getting this to something like 70, 80% independent environment or it would remain like this.
Rahul R. Agrawal
I can’t. Comment at this stage. Like I said it’s been five months since we have taken over the business and a lot of work is going on in terms of, you know again repeating here in terms of convincing customers to move from the earlier branded products product to our branded product meeting all the customers across the. Across the space. Of course we have added a lot of salespeople for that effect but we do believe it will happen sometime soon.
Santosh Keshri
Okay great. Thank you so much sir. Wish you all good luck.
Rahul R. Agrawal
Thank you.
operator
Thank you. We take the next question from the line of Rahul Agrawal from Igigai Asset. Please proceed.
Rahul Agarwal
Hi, very good afternoon to Rahul and Mukeshi a few questions, I’ll list them down. Firstly to start with on the industry side you know one of the larger peers obviously just started a plant. I think fiscal 26 volume is going to be much lower not very meaningful so nothing much from that side but looks like the second period is actually cut down on CapEx. Earlier the plan was to add much more capacity looks like it’s going to be about another 25,000 tonnes. This is on ABS so from a pricing perspective I think earlier analysts were asking more from a fiscal 26 perspective but I’m you know much more longer term.
Fiscal 2728 your views on ABS in light of increasing domestic supply if you could share something on that that would be helpful. Second on the inventory I believe we ended March 25th both in India and Thailand with higher than normal levels of inventory. Pricing has been a bit volatile and bit weaker in my understanding on QOQ basis haven’t seen any drop in gross margins for you which I think is commendable in the Indian market in the India results. So any comments on inventory losses? If you could just comment on that that would be helpful. Third on the capex I think more specifically how much money did the budget is finalized for fiscal 26 I’m assuming yes we just share the number in terms of how much was spent in 1Q and what’s the balance CapEx spend for the balance 9 months in 26 and 27 and lastly on the balance sheet again we had about 5055 crores of net cash as of March 25th balance sheet I think the 1Q cash profit was about 65 crores.
I am not sure how did the working capital behave in the quarter. So what was the thought process for a, you know for a 50, 55 crore dividend? Because my sense was that we had lined up a decent amount of CapEx for the full year to ramp up this ABS capacity. So just some thoughts on that decision will help. Those are my questions. Thank you.
Rahul R. Agrawal
Thanks Rahul. So like, you know, I won’t speculate on, you know, about the peers in terms of what they are doing but from whatever market information that we have and we are assuming that all of this is going to go to plan, we do believe from a longer term in terms of pricing we will be fine. Because I think overall demand in the country will remain robust, you know, barring a few months here and there in terms of specific reasons. But you know the demand in the country will remain robust and in terms of imports, you know there will be an opportunity for more domestic players to capture that market.
So this is of course something that we have believed in the past and we continue to believe this going forward as well. In the short term there is, there could be some pricing pressures or margin pressures but again it’s a little speculative in my mind to comment on it immediately but there is an opportunity in the market. There is a space in the market which can be occupied by additional volumes in the market. So I think nobody, none of me or I’m assuming the peers also would not want to destroy value. So the idea would be to capture those volumes for which are not being serviced by us or not being able to be serviced by us because we don’t have the capacity.
So we’ll see how that plays out. In terms of inventories in Thailand and India, yes there are, there was some ramp up of inventory if you look at towards the March, March end quarter, you know and I think we had addressed this in the last investor call as well. But I can repeat it essentially for Thailand what we had done is we had just taken over the business in mid January and we wanted to ascertain the asset quality because of course it is an asset having quite a few years. And while INEOS of course has done had done a lot of capex on the asset in recent years, we just wanted to ensure that the Thailand plant is able to produce at the level at which we believed it can.
So we are happy to see that it can. And as a result of it there was a ramp up of inventory. There is another aspect by which we have an agreement with ineos. I can’t detail all of those things because it is confidential in nature but we had to ramp up some volumes by specific periods and we had done that. We will see some of that evening out over the next few months. Inventories will be brought back down in India again. We have in fact reduced those inventories in this quarter. There is a reduction between the March ending and the June ending quarter.
In terms of gross margins, yes, your observations are okay. In terms of pricing, again it is a function of product mix that we supply. So we see some changes in that as well. With regards to specific, specifically with regards to dividend I’ll comment and then the rest of it for Capex and balance sheet I’ll ask the CFO to comment but on the dividend. See we have always believed in trying to work with all our shareholders. Most equitably we do believe that if the CapEx requirements or the cash requirements of the company come at a specific time and we have cash on hand, then the best use of that cash is back to the shareholders.
So we have kept that same philosophy in mind and given it when we do believe we need the cash for the company for the capex and as per our plan I think we are well on target to ensure there is no gap. So this has been the philosophy of the company all along and this is what we intend to do. So I will give it to Bhupesh to comment on the Capex and the balance sheet.
Bhupesh P. Porwal
Yeah. So regarding Capex for the phase one as we had mentioned earlier it will be around, we’ll be spending around 325 to 350cr by March 27 and that plan is as per schedule going on which has been announced earlier. Regarding balance sheet I think you were, you were asking about the cash positions at the March end and the June end. So as MD already mentioned, so we had some reduction of the inventory in this quarter end. So any other questions on balance sheet.
Rahul Agarwal
Bhupeshi? Just the 1Q spent on CapEx and what is the budget for rest of the nine months? So full year CapEx for 26 and 27 and what is already done in 1Q?
Bhupesh P. Porwal
Yeah, so maybe because there is only quarter one being done, maybe we would like to maybe publish these details more at the half year end.
Rahul R. Agrawal
So.
Bhupesh P. Porwal
So these are only three months up till now we’ve just started it. So by September end we will be able to give a more concrete picture. On because there will be six months ending on at that period
Rahul R. Agrawal
we’ll be. Publishing the balance sheet also. So it both will serve that purpose.
Bhupesh P. Porwal
Yeah.
Rahul Agarwal
Okay.
Rahul R. Agrawal
Dynamic environment with peers closely looking into these numbers. So let’s address this at the right time.
Rahul Agarwal
Yeah got understand that, understand that and congratulations for a better performance versus peer. When I look at the quarter I think it was really tough. You Got you guys have hold on to margins. It’s very good and healthy to look at. Best wishes for the Independence Day and rest of the year. Thank you so much.
Rahul R. Agrawal
Thank you.
Bhupesh P. Porwal
Thank you.
operator
Thank you. We take the next question from the line of Aditya Khairan from Swift Institutional Equities. Please proceed.
Aditya Khetan
Yeah, thank you sir for the follow up. So just a couple of questions first time. So when we look at the conversion cost in Thailand business it is almost twice of the standalone India business. Any plans are like how we can reduce this cost and any further capital injection would be needed to bring down the cost. And when can we achieve this like by. So by this fiscal end or by FY27. The second question is onto the refrigerator side ABS which we are again making in Thailand. So what is the total market in the overall absurd of this specific grid? And sir how it is different like in terms of applications in terms of price and cost compared to our standalone so specialty and the.
And. And. And the normal grid. So how different it is. And the third question sir I believe in FY25 the SAN volumes were somewhere around 15000 tons. So with the ramp up of ABS like in FY26 we are near operating at full that sand volumes will come down. And sir what will be the external sales volume of sand if you can give for FY26?
Rahul R. Agrawal
Okay, it’s a good observation. The conversion cost in Thailand is higher than India and this is something that our team is working on in terms of reducing is not know as straightforward as one would imagine. There is a lot of work that needs to happen in order to try and reduce that conversion cost. This will take some time. We don’t believe we will need a lot of capex in order to achieve that. This is going to be more to do with again process improvements. The other fact which I mentioned again you know if you have a higher capacity utilization we do see the conversion costs coming down significantly.
So this is also going to be an impact. So again selling more is going to be key from Thailand in order to help on multiple fronts as far as the refrigerant ABS market is concerned. Again globally it’s a large market right now if I look at the Indian market opportunity it is anywhere from 25 to 35,000 chance there is some switch typically between hips and ABS from time to time. In terms of the ABS quality itself it has certain mechanical and chemical properties which are different from the rest of the abs. There are specific types of grades which we are able to make in Thailand for This as we have mentioned in the past, so this will be an addressable opportunity for us in India as well.
The pricing is better in Thailand for this product. Again, because of the nature of confidentiality in this information, I would not comment on how much higher or how much higher the price is, but it is a better margin for sure. When I look at SAN volumes, the overall SAN volumes for last year and if you look at the overall SAN volumes for this year, we are targeting slightly higher SAN volumes. Then we are looking at CAPEX and increasing capacities. The SAN capacity is also going to be increased as a result of this. So all of this is going hand in hand and we don’t believe there will be any shortfall in our ability to supply SAN to the market on account of additional ABS capacity.
So we’ll be able to do the balancing and still be able to produce more sun to service the market and also meet our targets.
Aditya Khetan
Got it sir. Got it. Sir, just one question. So timeline for that. So 1 lakh ton expansion in ABS and 50,000 tons in polystyrene. So timeline sir, if you can check when are we planning to end?
Rahul R. Agrawal
So it’s the same what we have mentioned earlier. I think we have spoken about, you know FY27 is and we’re looking to add 50,000 tons additional ABS and FY28 the remaining 50,000 tonnes. So that remains the same. And the HIPS expansion will also happen around the same time. So there is no change in the timeline. There is no additional update at this stage. You know, whenever we do have an update we’ll definitely share with you.
Aditya Khetan
Got it sir. Thank you sir. That’s it from me.
operator
Thank you. We take the next question from the line of Pratik Singhania from SAG Investments. Please proceed.
Pratik Singhania
Yes sir. So my first question is with respect to Thailand, sir, we are selling HRG also externally or we are just focusing on selling ABS and sand. Second question is with respect to. Second. Hello. Am I audible?
Rahul R. Agrawal
Yes, go ahead.
Aditya Khetan
Yeah, second question is with respect to. If production is not a problem for us with respect to Thailand and in san, if we can increase our capacity in SAN and also compounding which will not take much line because much time because like it can be done faster it then do you have to wait for like one and a half year to increase your domestic production in abs or we can import HRG from Thailand and do the compounding with SAN with the. And then sell more quantities of ABS in India.
Rahul R. Agrawal
Any other questions? Pratik.
Pratik Singhania
Only kv it was like with respect to the previous Questions which Aditya asked so over here like doing this, whether hindrance is with respect to the cost of manufacturing HRG in Thailand which makes it on infeasible for it to be imported in India into the ABS manufacturing. This was the three questions.
Rahul R. Agrawal
Okay, thank you Pratik. So Pratik, in Thailand we make a different kind of an HRG product. It’s called Mac50. It’s a bimodal rubber which offers unique properties for multiple applications and multiple segments. And we do supply this to other some customers, specific customers, you know, outside of, you know, our own consumption. So we do supply in China and in Thailand and also in Japan to certain customers this product with regards to, you know, ramping up in India from, and getting the product from Thailand, you know, obviously there is a cost involved. It’s not just the cost of manufacturing in Thailand which might be slightly higher for specific product grades.
And of course you know, using Mag50 in India is something we do do in terms of balancing but may not be ideal from a cost position perspective because the product is sometimes better utilized for other product grades as opposed to for the type of products we make in India. So the value addition can be higher is what I mean. In terms of SAN also again you know, In ABS typically 70, 75% can be SAN. So importing it from Thailand with the freight component and the additional costs associated with it, you know, would be difficult. It’s not just the, the cost of producing SAN itself in Thailand is quite competitive but the cost of again moving it and using it in India may not be the most viable in terms of the ideal way of running the business.
So we do believe that these products in terms of pricing realization can have better pricing realization for the specific grades that we produce in other markets as opposed to bringing them into India in and using it for our grades here. So again I think from us from a strategy perspective as well, it serves us better to cater to different OEMs in different parts of the world as opposed to trying to bring that into filling specifically in India from a Thailand perspective.
Pratik Singhania
Okay, but then sir, with respect to this capacity utilization currently being at 90 plus and then in domestic not able to increase the volume Q on Q with respect to ABS like sales then how do you see that like are we in a weight and watch position that we want the competitor plan to come up, see how the entire market behaves for five, six months and then we need to, we would want to like increase the capacity then.
Rahul R. Agrawal
So you know, like I mentioned in the investor presentation, one of the Key increases that we saw towards the end of last year and which we have been able to successfully realize is our HRG capacity. In first quarter of this year we have been able to produce 20% more, which is significant given the low cost that we incurred for that. So we are already producing more ABS and selling more ABS in the market. Our volumes indicate that as well for the first quarter. And we do believe that, yes, we can bring some rubber from Thailand and do this.
We have the SAN currently available in order to do that as well. So the San we have extra. We’ve always had extra San in India, so that’s not a concern. But we really have to see from a value proposition perspective what makes more sense. Right. For the, for the organization, it’s been only five months in Thailand. We do believe that there is a lot of opportunity, opportunity to realize much higher value for those products elsewhere. And we should do that once we commit these volumes to specific areas. This is not a pure commodity where you want to plug in and plug out.
If you are going to cater to say specific OEMs in Japan or China or wherever, then you would want to be able to supply them going forward. So there are some strategic calls the organization needs to take in place. And of course it’s only been five months, so it’s been a very short time in Thailand where, you know, we can take the calls in a reasonable period of time. What makes sense for the whole group.
Pratik Singhania
And in next like few months, can we see another line of SAN getting added in our capacity?
Rahul R. Agrawal
No.
Pratik Singhania
Okay. Okay, sure. Thank you so much.
operator
Thank you. Before we proceed with the next question, ladies and gentlemen, in order to ensure that the management is able to address questions from all the participants, please limit your questions to two per participant. We take the next question from the line of Rahul from Sofia Capital. Please proceed.
Unidentified Participant
Yes, I. Can you hear me?
Rahul R. Agrawal
Yeah, go ahead.
Unidentified Participant
Yeah. Hi. So four quick questions. Firstly, you mentioned Thailand. You’re running at a utilization of 50 to 55%, correct? Firstly, what is the total capacity there and what is the peak utilization you can achieve there? And with that what kind of revenue potential it has? Secondly, how has quarter two been so far in the last half months or so? What’s the general demand scenario on ground? And you also mentioned in Thailand you benefited from some sort of new product mix which is, you know, I think you have some specialty ABS grades, grade of products which you, you know, have, have access to via the acquisition.
So how margin accretive are they? And lastly, any sort of revenue volume guidance for the year. Thank you.
Rahul R. Agrawal
Yeah. Hi. So in terms of capacity utilization, you know, we are doing essentially 55% capacity utilization in Thailand. Essentially if you look at the revenue in Thailand that we have and you assume a similar product mix, you can see that we can essentially increase revenue by close to 70 to 80% additionally from where we are at. So this is the kind of peak revenue which is possible given the current product mix if it remains the same from Thailand. We are not sure that that would be the case. But we have to see in terms of the second quarter, you know, again, we typically don’t give forward looking statements or statements like this until the quarter comes to an end.
So. So I will excuse myself from answering that question. In terms of the Thailand product mix. Yes. There are again products which we are doing. I spoke about the bimodal rubber which is unique which has certain benefits for certain applications. There is a refrigerant ABS that we do from Thailand which is a unique and value added product. There are certain sand grades that we make like a food grade san which goes into certain appliances where there is direct food contact which has a higher margin. So there are. And there is of course a lot of high heat ABS also which we do into automotive industry.
So all these are kind of the higher value added products which we do from Thailand and we do believe there is a lot of scope to increase that going forward as well. So in terms of volume guidance, I think for the year we mentioned, you know, 12 to 13% which is in line with what additional volumes will be available to us in India and we should be able to do that for Thailand. Again, you know, it’s a little bit early to exactly give what volumes we will end up with towards the end of the year.
operator
Hello Mr. Rahir.
Unidentified Participant
Thank you. Thank you.
operator
Yes, thank you. We take the next question from the line of Krunal Shah from Enam Investments. Please proceed.
Krunal Shah
Hi. Thank you for the opportunity and congratulations on the good set of numbers. So I have three questions. One is in Thailand, have we added any new customers during the period in which we have had control? The second question is in terms of Asalac and PCIBS lens, what kind of volumes are we doing there right now? And the third question is eu. So a lot of chemical companies are shutting operations with a high power cost. Are you seeing a similar trend in some polymer there? And would that create an opportunity for us to export in the medium to long term? Thank you.
Rahul R. Agrawal
Yeah, so thanks for your question. So in terms of new customers in Thailand. Yes, in fact we have added quite a few customers. In fact both ways we are adding new customers in India as well as Thailand because there are certain companies and OEMs which are producing in Thailand where we have approvals in India we are able to leverage that for Thailand. And similarly from Thailand we have certain approvals which we are able to leverage for India. So we have been able to do that very quickly in the last three, four months. Typically approvals take a long time, as you know, in the industries that we are present in.
So there is a lot of work going on currently to get those approvals in place and to move those products as well. And over a period of time we do see that we will have several new customers not only in Thailand, I mean not only within the domestic part of Thailand, but also in China and Japan and Vietnam, South Korea, all these places. So lots of activity going on there. We’ve opened offices like I mentioned in Shanghai and also we have a sales team now in Vietnam and Japan, South Korea as well as Indonesia. So which will again be part of that force to increase those sales.
Slaq and PCabs. There is good growth in terms of volumes. We are still not where we want to be. You know, we are doing close to 100 tons of product every month or 150 tons per month. I do believe these numbers can be much higher and we will get there. So there is a lot of validations again which are going on for all these blends and we do believe that in the next one year or so we will get to that point. In terms of EU higher power costs and export potential. Yes, there is export potential but currently if I look at India, we are completely sold out.
We don’t have really much volume to spare. But there are certain opportunities that we are actively looking at for the EU where we believe that sales can be developed. There is a long period in terms of qualification and all of that is going on for the EU as well. But I think short term, maybe not, but medium to long term, yes, there will be opportunities for export from India as well, which we are looking at.
Krunal Shah
Great. Thank you so much. Thank you.
Rahul R. Agrawal
You’re welcome.
operator
Thank you. We take the next question from the line of Pawan from NMV securities. Please proceed.
Rahul R. Agrawal
Yeah, go ahead.
Pawan
So I have two nitting question on one on CapEx. So last quarter we have differed on spell out the polystyrene capex. So current guidance of 350 crore for this year include the polystyrene Capex. And second question will be on what will be our careful capacity for FY26 including the expansion of ABC.
Rahul R. Agrawal
Okay. With regards to capacity for FY26 it will be in line with what we had given in the earlier investor presentation which I think is to the tune of about 210, 215,000 tonnes for all the products that we produce in India. Thailand is separate of course. With regards to the PS CapEx. I’ll let our CFO comment.
Bhupesh P. Porwal
Yeah. So PS CapEx as announced earlier, the engineering study is going on. Once it is completed we’ll let you. Know more details about it.
Pawan
So current guidance of $350 doesn’t include polystyrene?
Bhupesh P. Porwal
Correct.
Pawan
Thank you.
operator
Thank you ladies and gentlemen. We take that as the last question for the day and would now like to hand the conference over to Mr. Chintan Doshi for closing comments. Over to you sir.
Chintan Doshi
Thank you everyone for joining us today on union call. We appreciate your interest time in the company. We look forward to answering you in. The next meeting which will be announced. At suitable time in the future. Thank you.
operator
On behalf of citrinex Performance Materials Ltd. That concludes this conference. Thank you for joining us. And you may now disconnect your lines.