Balrampur Chini Mills Ltd
NSE:BALRAMCHIN
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Balrampur Chini Mills Ltd
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Ladies and gentlemen, good day and welcome to Balrampur Chini Mills Limited Earnings Conference Call. [Operator Instructions] Please note that this conference is being recorded.I now hand the conference over to Mr. Anoop Poojari from CDR India. Thank you and over to you, sir.
Thank you. Good afternoon, everyone, and thank you for joining us on Balrampur Chini Mills Q3 and 9M FY '23 Results Conference Call. We have with us Mr. Vivek Saraogi, Chairman and Managing Director; Ms. Avantika Saraogi, Business Lead; and Mr. Pramod Patwari, Chief Financial Officer of the company. We will initiate the call with opening remarks from the management. Following which, we have the forum open for a question-and-answer session. Before we begin, I would like to point out that some statements made in today's call may be forward-looking in nature and a disclaimer to this effect has been included in the results presentation shared with you earlier.I would now like to invite Mr. Saraogi to make his opening remarks.
Thank you, Anoop, and good morning to everyone and thank you for joining us on Balrampur's Q3, 9 Months FY '23 Earnings Call. I trust all of you have had the opportunity to go through our results presentation providing details of our operation and financial performance. I will initiate the call with an update on the current developments in the sugar sector followed by our company's highlights. According to the latest estimates from ISMA, Indian production is now expected to be at around 34 million tonnes, which was earlier forecast at 36.5 million tonnes. This is primarily owing to a lower crop in -- or lower yield in Maharashtra, Karnataka and obviously this is accounting for a little higher diversion owing to sugarcane juice being diverted and B-heavy towards ethanol production.Sugar production in Maharashtra is expected to decrease to 12 million tonnes from 13.7 million tonnes, U.P. is predicted to remain flat at 10.2 million tonnes, Karnataka is expected to decrease to 5.6 million tonnes, others outside these 3 major states say at about 6 million tonnes to 6.2 million tonnes making for a total of 34 million tonnes. The government has already allowed an export of 6 million tonnes. And just to sort of set the balance sheet in order, opening stock Pramod, would be about 5.6 -- 5.5 million tonnes. 34 million tonnes is our production; export 6 million tonnes, balance left over 18 million tonnes, consumption between 27.5 million tonnes to 28 million tonnes. So inventory at best could go up to 5.5 million tonnes to 5.7 million tonnes. So we will probably end this season with an inventory, which is similar to the preceding season.On the business front -- moving on to the update on ethanol sector. As most of you are aware, India has made remarkable progress in increasing the blend with the petrol ratio to 10%. Government has set a goal of 20% in '25-'26. E20 fuel at 84 retail outlets have been launched and this has shown certain move towards 20% blending. You're aware of how much interest and attention the honorable Prime Minister is giving to this program. On the business front, the company's results for the quarter were impacted by lower sugar sales volume and that is owing to a lower quota. Untimely rains in east U.P. and some delays for our new projects based on late supply of machinery have caused a late start. But in our area, we do not have any diversion of grain so our initial testing estimate is our current estimate also. Maybe we are seeing a marginal yield, which is better than what we expected.So we should be able to close the season at about 1,030 lakh to 1,040 lakh quintals of production and we are hoping for a better recovery and the trend is already showing. On C-basis because that is the only barometer because we have B-heavy and juice diversion. So our C-heavy expectation of recovery this year is better than last -- hopefully better than last year. Coming to our distributor business, I am pleased to announce that Maizapur and Balrampur units have successfully installed the state-of-the-art distillery facility. Maizapur is working on a full-fledged 100% setup diversion. So not even a single bag of sugar is going to be produced in Maizapur this year. Balrampur is working on a 2/3, 1/3 formula and everything has been done as per our expectation. So sugar capacity modernization Balrampur distillery, Maizapur distillery, Gularia expansion was done last year. So the sum total of this is Balrampur would have a 1,050 KLPD installed capacity, which will allow us to produce 35 crore liters on an annual basis.This year we are targeting a production in the balance sheet -- not in the balance sheet, for the sugar season, around 31. This year we would be producing 30 crore liters and next year with some enhancement of grain, which we are very certain of, we would be able to produce 35 crore liters. So this would make Balrampur a major contributor and probably the largest supplier in terms of volume delivered to the OMC in the country. In conclusion, we remain committed towards maximum returns from each stick of grain crushed, which has helped us generate sustainable value for the shareholders. As part of this commitment, I'm happy to inform Board of Directors declared an interim dividend of INR2.5 per share of INR1 each. Further, we initiated our sixth consecutive buyback, which has commenced on 16th November. As of 8th November -- sorry, 10th February, company bought back 4,55,723 equity sharesSo with this, I hand over the mic to Pramod.
Thank you, sir. Thank you and good afternoon, everyone. I hope all of you had the opportunity to go through our detailed results presentation that has been shared with you wherein all financial performance, including quantitative data, have been given.To ensure that we have a larger portion of time for Q&A, I would like to request the moderator to open the forum. Thank you.
[Operator Instructions] We take the first question from the line of Shailesh Kanani from Centrum Broking.
Sir, till December the recovery numbers are very good. Can you give some latest update about the same? How has been the month of Jan and Feb until now on the recovery front?
So extrapolating to C as I said in the beginning, at this point of time we have crossed last year's recovery. The trend is obviously positive, but impossible to give you figures beyond that.
Fair enough. Sir, second question was with respect to our crushing capacity. Given the availability of cane if it's not a constraint, what is the volume of cane which can be practically crushed in a quarter? I mean can we crush say more than 600 lakh quintals because I think the last batch what we had done is around 590 lakh quintals in 4Q FY '20. So given the debottlenecking we have done so what is the current maximum we can do in a quarter?
So while Pramod is calculating this, I'm going to reply to you on season basis, I'm going to reply to our ideal capacity or our ideal cane crush would be closer to 12 crores -- between 11.5 crores to 12 crores quintals of cane. We are targeting about 1,040 lakh quintals this year, another [ 10 ] means another 1.5 crore quintals we can crush with this capacity.
For the sugar season, 1,030 lakh quintals is what we have stated and for the FY '23 looks like between 9.25 crores to 9.5 crores quintals of cane.
Okay. Sir, just some data keeping questions. Out of the total ethanol contract we have entered into 26.75 crores, can you give the breakup of pending volumes under different routes?
Pending volumes?
Yes, we would have done some shipment.
That is given in the presentation.
That is pending volumes so there are the total volumes under for FY '23. I'm assuming that we have done some shipment in the month of December so those would be...
We have given the breakup of 26.74 lakh in the presentation. Around 8.4 lakh on account of juice, 5.37 lakh is grain-based. 25 lakhs is C-heavy and rest is B-heavy.
Okay. So those are from -- so there is nothing going from the -- that is helpful 26.75 lakhs from Jan, but December [Foreign Language].
Right. This is from 1st December.
1st December. So that is the reason I wanted the breakup of that pending volumes if it's possible to share or I can take it offline. Okay. I can take it offline. Sir, can you also give the split even between domestic and export quantity and realizations for the quarter?
Realization we have stated in the presentation, export was around 37 lakh plus and 6.5 lakh was around domestic.
Sir, last question from my side. We are operating one of the biggest ethanol production operations facility in India if I'm not wrong, right? So can you share if there's any headroom for further expansion on that plant? Is there any scope for that?
So good question. Depending on the availability of cane as I said, if we look to crop; we will align ourselves to this based on next year's availability and then take a decision. Yes, there is scope to expand, put greenfield juice project, there is scope for everything.
Our next question is from the line of Sanjay Manyal from ICICI Direct.
Just one question on the varietal front. Is it now clear to say that the Co 0238 is a waning variety and as we are changing our sugarcane variety in our catchment area, what would be the proportion of a newer variety and what it would be next season? And is it safe to say that the recovery in the yield would be similar to Co 0238?
Avantika?
Thank you for the question. About varietal balance, definitely it's safe to say Co0238 is a waning variety and as we stand today, we are already in a very good varietal balance in ratoon as well as plant. We have 4, 5 good varieties in the pipeline and any dependence on any single variety is completely reduced. So any time we see anything happening, we are free to switch within the year itself. Having said that, if it is going to be 4 to 5 varieties, we would not ideally like to take any 1 variety more than 30%, between 20% and 30% depending on the conditions of any particular factory. That's what I can say and even now this is underplay.
So Avantika, his question was twofold. I think he's looking for the recovery impact on the newer variety versus...
Yes. So definitely 0238 has become a benchmark for us and we don't want to go below it in any way. So all the varieties that we are now constituting are good in terms of yield and recovery as compared to 0238.
So if I may just take this ahead. The newer varieties which are in play, my personal view the recovery is slightly better and yield might be slightly lower. So to get our cane, we are looking to do better ratoon management and higher area under cane.
So should I complete the thought on cane now?
Go ahead.
Okay. So I just want to say that this crushing season, we have a 15% increase in cane availability. Next year also, as my dad was mentioning, we will increase cane further by another 5% to 15% depending on weather conditions. Last year we did very, very good ratoon management practices, which is usually where [ E2P ] lags behind and therefore, our yield and acreage of ratoon have increased this season and the figures are absolutely coinciding with our plans and predictions. We have kept all insect pest diseases under control and we are always vigilant so that nothing gets a chance to increase in our area and give us any serious hit. Also our tissue culture lab is running on full capacity and our healthy and pure speed distribution program has already begun from it. This will further help us maintain a good varietal balance and disease and insect free crops in the future.
Okay. Just 1 follow-up. You mentioned that recoveries are better than Co 0238 now. So are you talking about the current status of recovery or the peak recovery we got in Co 0238?
I gave you a view on the current season that as of today we have crossed last year's recovery as on 10th February let us say -- on 12th February.
I think his question is 238 at its peak versus other varieties at its peak, correct?
Right.
Yes. So like I said, whenever we do any testing, we are benchmarking with 238 performance which we've enjoyed for such a long period of time. So it's like 238 at its peak business.
Understood. And just I think last quarter we mentioned that our distillery volumes for the FY '23 should be somewhere around 22 crores liters. Do you stand with that guidance or is there any change given the fact that late start of crushing?
Yes. Your question is extremely right. Because of the late start, we are revising it. Now our expectation is between 20.5 crores liters to 21 crores liters. for FY '23.
Just let me put some more facts on the table because this will lead to reasonable doubt and put certain other questions. So we began, let us say, Balrampur distillery because of the late development after 15th of December. Sugar began after the 7th of December. Now we were 20 days late at least in either or. Maizapur began in about 4th, 5th December and my dates might be off by 2, 3 days. So these volumes have got shifted to next year, both the cane volume and the distillation volume. So as we spoke, our crushing for the season remains unchanged, maybe 0.5%, 1% higher only. Our distillation volumes have been mentioned to you by Pramod, 30 crore plus slightly -- between 30 and 31 crore probably. So these 2 figures remain sacrosanct. Balance sheet, what doesn't happen in March will happen in April.
Right, sir. Just one last on the sales of bagasse, if it is possible for you to mention what would be the bagasse sale in 9 months FY '23 compared to last year and the income tax rate for FY '23, '24 and '25? That's it from my side.
We'll have to work out and tell you.
We'll revert. Bagasse has sold at a much higher price than last year if you take the quarter wise.
Our next question is from the line of Nikhil Gada from Abacus AMC.
Sir, my first question on the crushing part itself and specifically for FY '23. If we are doing 77,000-odd PCD per day, then this 9.25 lakh to 9.5 lakh quintal number that you have given, isn't it a bit lower from FY '23 perspective?
As I told you if we began our season late, your FY '23 reduces. If I had began on 20th, but I began on, let's say, 10th of January, that is the reason this is going to be lower this year. You have lesser number of crushing days in the current balance sheet in this period beginning November to March -- November whatever to March end.
Understood. And from that perspective if we are saying that the yield or the crop yield will increase by another 3% to 5% in next sugar season so that basically sort of helps us go back to the 110,000 or 11 crores sort of a number. Is that possible in the coming year or so?
Yes. I think we've already explained 1,030 plus lakh quintal would we are crushing expectation this year. Avantika has indicated 5% to 15% enhancement next year. So let's say there is a 10%-plus enhancement next year, next year we'll crush 11.5 crore quintals.
Understood sir. Got it, sir. Sir, secondly, just on the ethanol front. For 3Q I think in the presentation you have given the realization for C-heavy, B-heavy. Could you highlight the realization for sugar syrup as in sugarcane juice and grain based for the quarter?
Grain based is 55.5 and that one is 66.61 tonnes.
So let's just be very clear. There is no need to ask any company in the country on these realizations. Anything which goes from juice is 65.61; anything that goes from B-heavy, 60.73. There are 2 types of rice, one is the full rice, one is the broken rice. FCI the full rice is 58.5 and the broken rice is 55.52. So this is the realization of these products, whatever you've tendered, whatever you supply, each product's price has been told to you.
Understood, sir. And generally, as of now for grain-based, we are going to do it through FCI route, right?
Yes, largely.
Got it, sir. And sir, just my last question specifically again from the overall inventory perspective. And if I see the quarter numbers where the change in inventory is I think close to around INR230-odd crores in this particular quarter. So if you can just break this up for us in terms of how much has been due to sugar and how much has been due to ethanol?
This is already given in great detail in the presentation. We are holding around 15.85 lakh quintals of sugar and around 49 lakh liters of alcohol.
Sir, was there any major change from a quarter-on-quarter perspective in ethanol for this particular because I think we are going through juice route so we might be storing more B-heavy molasses as of now and maybe losing it?
Whatever inventory we are holding; be it C-heavy, B-heavy, alcohol, sugar; all stated in the presentation. Slide 27, you will find all the details.
Our next question is from the line of Anupam Goswami from BOB Caps.
So my first question is on the cost of production that we have seen. As my understanding goes because we had a late start and a low volume so that's why fixed cost absorption did not take place. So this will delay till April and do we see a further extension of crushing days in April?
Yes, absolutely. So we see a spillage and therefore a much larger crushing in the FY '24 balance sheet than we saw in FY '23 balance sheet in April and May.
Okay. And if we look at season wise so now what the cost of production is at INR4,100 or so, that will go down when this whole volume also picks up, right? Am I correct on that?
100%.
You may refer Slide 22. Last year also the cost of production was INR4,100 at the end of 9-month period, which went down to INR3,400.
So Pramod's and his team has taken great pain in making the presentation.
Absolutely, sir. My next question on the strategy side, where do we see the mix of ethanol from all the sources and given that, what sort of margin are we looking at in the distillery segment?
Margins will be a function of realization, which has been fixed by the Government of India on an annual basis. And if you are comparing the distillery which we achieved few years back, that is not going to be the case because in those years, molasses was practically tied at 0 value.
So If I may add, Pramod, the entire business is to stay inside the company. It is a sectoral allocation, correct?
Right, sir. I'm talking about excluding the transfer prices. If we exclude the transfer prices given my understanding, sugar juice has a lower margin whereas grain is also slightly lower than the C-heavy also. So where do we see in the mix now that we are doing sugar juice as well as grain base? Where do we see those margins compared to the last year's or earlier years excluding the transfer prices?
Anupam, we have said again and again that this business needs to be seen from the totality perspective. The kind of realization which we are getting in sugar or we might get in future will be a function of how much of sugar is getting diverted into ethanol.
But even at the same time, see it's early days. It's the first in the country kind of a distillery where no sugar is made. So though we are tracking the data very closely, I'm pretty certain that at the end of the season the distilleries will throw off a pleasant surprise to what we thought. So I'm not going to say that juice is going to be definitely lower than B-heavy or grain is going to be lower. So it's all work in progress and we will see how things go.
So down the line, let's say, in 2 years when we have an industry diversion also much higher. So the vision is to have a higher sugar realization at like, say 38%, 39% sort of and that balances out the whole. Definitely. And if juice price government actually seriously interested in getting 20%, they will have to incentive from next year onwards. So if that happens, more juice at a lucrative price means lesser sugar means a better sugar balance, et cetera. So we remain structurally and fundamentally positive as we proceed into the future both on the macro perspective and our Balrampur micro perspective. So again I'll just take the audience through the philosophy of our company. Avantika has laid threadbare in front of you the kind of attention tissue culture will have, the kind of attention and the focus we are paying to cane. We have a centralized team which is out there and looking at all the 10 factories on a microscope basis. Our challenge is getting answered partly this year and hopefully as we proceed, it should be very beneficial.So if we are able to go up 15% this year, I don't think any company, and this is my guess till now, any company will increase that much. As we proceed if we keep getting our cane which we are most certain we will, you will see how the business will flourish both in terms of volume in distillation as well as sugar and we'll also be able to achieve economies of scale, fixed cost will get reduced. So we think it's very positive that whatever ethanol one makes will get picked up at good prices. As we proceed, prices keeps getting lucrative. That also is a tailwind towards sugar and sugar price with this -- I would call this inventory bone-thin inventory. With this bone-thin inventory of 5.5%, I feel that our price realization from now up to October should also gradually trend upwards. Okay, sir. Sir, my last question is what is the price realization right now in Feb, Jan quarter?
35.5 ballpark currently.
Our next question is from the line of Rajesh Majumdar from B&K Securities.
I just had 2 questions. One is the Gularia expansion. So when will it be ready for us in terms of the sugar season?
Gularia expansion got commissioned last year.
Sorry, the one you recently announced.
This could be ready and up next season November '23.
So sugar season '23-'24, it will be fully operational.
Full operational.
Okay. And sir, my second question is more of a strategic kind of question. How long do you see the fixed pricing on ethanol to continue? Because beyond 20% blending, there's not much visibility in terms of flex fuel vehicles and so on. So will this fixed pricing scenario for ethanol continue till eternity or there is something which can happen in between? And what is the kind of game plan as a company we have in order to counter that?
So I would just begin by saying even life cannot continue in eternity. Having said that, basically let's understand the dynamics. Today in this year, Pramod, I think we'll struggle to go to 12% blend for the year, correct? As we proceed to take this blend upwards, you need juice diversion for which you need not only fixed pricing, but enhanced level of the current fixed pricing. I would call it incentivized pricing. So to take you to 20% is going to be a task. To get to 20% is very tough, it's not easy. Trust me. You need lot more capacity in place. That's first. So to answer your first question that when government achieves 20%, will it dump you? So first of all, achieving 20% is 3, 4 years away to my mind. Then when you achieve 20% and you have to be at 20% is not easy again. There's 1 year suppose there's a drought something, that again a challenge. Thirdly, I am very clear that the government is on this move for improving flex fuel vehicles. There is incentive, there is a PLI scheme, there's a lot of work going on with the auto manufacturers.There will be hybrid vehicles, they have the flex fuel vehicles. Government is talking of cooking gas. There's going to be multiple usage government is thinking of. So I would feel that this formula is here to live. It's also important for this to live because government of India earlier used to give export subsidy. Now if your production comes under control, that money does not leave the government hands. Two, this pricing is to ensure even cane price payment. So that also being the mandate of any vested government cannot go off the table. So farmer is a very important part of not only our regional economy, but of the political capital of the country. So that again won't go off the table. Three, this is paid for by the consumer and today seeing crude and exchange prices, it is not a negative item for the OMCs. Four, it is improving the carbon footprint. Our honorable Prime Minister has given the details of the number of carbon credits or carbon footprint savings we have achieved owing to this. So it is foreign exchange positive. So with all these 5 factors in play, I don't believe that your anxiety is my anxiety.
Sir, if I'm permitted just 1 more question. If at all you take a decision to expand ethanol capacity further, would it be concomitant on the increase in the juice pricing or will you do it nevertheless?
So that's very important. Economics is the reason why you would do business so we'll wait and watch.
Our next question is from the line of Nishant Sharma from Nuvama Wealth Research.
One question from my side is more of a confirmation that the export sales during the quarter was 0.5 lakh quintal?
Sorry, come again, please?
Am I audible now?
Yes, go ahead.
Yes. So just wanted to have a breakup of sugar sales for this quarter out of 20.26 lakh quintal to exports and domestic breakup.
We have given that [ 6.5 lakh ] quintals is the export and balance is domestic.
Okay. Understood. And out of our total quota of about 1.9 -- sorry, out of our total exports quota, what is left which is yet to be delivered?
So out of 1.98 lakh tonnes of export quota, we have contracted for physical expo of 1.4 lakh tonnes. Out of that, 65,000 tonnes already delivered within March -- sorry, within December and the balance maybe within March. And for the balance 58,000 tonnes of quota, we have exchanged with domestic release.
Do you have any more questions, Mr. Sharma?
Just 1 last question. Sir, what's your view on the U.P. state advised price? Is there likely increase in that and when is this likely to be announced?
Your guess is as good as mine. Having said that, it should have been announced. It's not yet announced. Our view is it should not increase, but that's a very personal view. The decision should come within February I hope.
Our next question is from the line of Achal Lohade from JM Financial.
Sorry, I'm repeating the question. You talked about exports. Is it 65,000 or 55,000; 65,000, right?
65,000.
And if you could help us with the realization as well, sir?
Achal, we have said that export is [ 37 plus ].
Got it. And second, can you help us understand the cane mix in terms of varietal mix. Is it possible to get some more color as to how it is currently for sugar season at peak and in a couple of years' time how do you look at the mix in terms of different varieties as we speak, whatever best guess we can have?
So Avantika did give a broad heads up. It's not possible to give you this data right now. We'll have to wait for another year. But trust the hard work going on and believe in it.
Absolutely. And sir, in a passing remark you mentioned about cooking gas. Is it anything to do with the ethanol or it's basically the biogas you're talking about?
Ethanol can be used for the cooking purpose also.
It's the government mandate. The level of the government's desire to sort of keep taking ethanol and keep building this, if I may say, fuel as a very serious player in the total fuel mix. There's experiment for mixing with diesel also going on. So there is a lot of sort of consumption as we see the future.
Can I add to that? There is also a DG set being powered by ethanol, big research happening. Kirloskar I think is already making DG for ethanol driven. And as much of fossil based carbon can be replaced by biocarbon, I think that is the way that the government is thinking.
Absolutely correct.
Any ballpark number with respect to this cooking gas because this is something new I presume [indiscernible]?
So if I may, first, you're going to get to 20% there. So we are talking of possible consumption points for new consumption areas. So one must be fulfilled to go to the other I guess, but government is seriously contemplating.
Got it. And just a last comment with respect to the E20, I know the government is -- very hard. But what about the existing fleet -- fill up E20 as you said 12% is the challenge like...
Are you talking about existing vehicles?
Yes, yes. Existing vehicles.
I think 1st April '23, all vehicles should be compatible to 20%.
And what is the extent of work which is going on. Do you think that is likely or you feel like it's too early to call it?
Achal, not able to hear you clearly.
Can you switch to a handset mode and talk, please, Achal?
Yes. Is it better now? Sorry about that. So what I wanted to check about this E20 in terms of the existing vehicles. You're saying that the mandate is to have all the existing vehicles ready for E20. Have I heard it right, sir?
From 1st April '23, correct? Not the 2 wheelers. 2 wheelers might be slightly lower, but 4 wheelers 20%.
Understood. And that preparation is on according to you in full scale, right, because we haven't heard as much about it. Okay. Got it. And with respect to the cane price, if you can give us some sense. Have you seen this kind of a delay in the past or this is the first time you're seeing cane price being announced in the month of February for U.P.?
It is rather late. I don't remember having seen cane price this delayed. 1 year it was delayed. But how is that of relevance? You want only the cane price not the date?
No, I'm just trying to get some sense. Okay. Sir, just last question, if I may, with respect to as we speak, what is the increase in the cane crushing volume? I know you've already given the guidance. But just wanted to understand the number yesterday. How is the cane crushing volume in terms of YoY and the recovery rate on a YoY basis, if any number you could share?
No, we would not like to share the number as of yesterday. For the quarter ended, we have already shared. We have already shared our vision or expectation for FY '23 as well as for the complete season.
And we give you a recovery change trend, we told you we started late. So there's no point getting into daily figures.
We'll take a next question from the line of [ Chandra Molin ], an Individual Investor.
What is the ethanol sales I mean in the last 9 months? You talked about the financial expectations is about INR21,000 crores, you have reduced it from previous INR23,000 crores. But what is that ethanol done till the last 9 months?
9 months we have supplied around 12 crores liters.
Our next question is from the line of Shailesh Kanani from Centrum Broking.
Just wanted to know your thoughts on the budget announcement on CPG side. There are some incentives which the government has announced. Now I understand we have entered into a contract for a [indiscernible] but are there any plans, anything on the drawing board with respect to the changing opportunities on that front?
To be very honest, we have not seen very great opportunity. We are not looking at that side so much.
Our next question is from the line of Sandip Sabharwal from Asksandipsabharwal.com.
My question is that companies like Praj have also talked of possible blending of ethanol with diesel using some agents, et cetera. So have you heard of that and anything going on on that front? So it's called a binder. So Praj and others, I would say maybe it's very close to completion.
Okay. Because diesel is a much bigger market so that could open up much more opportunity.
Diesel is huge. So I'm saying even if there's 2% blend in diesel, you don't have the capacity. So I therefore don't worry on the consumption point. I'm not worried on the quantum 1 produces and there's no doubt that whatever we produce will be lifted at attractive prices.
Ladies and gentlemen, that was the last question. I now hand the floor back to the management for closing comments. Over to you, sir.
Thank you, everyone.
Thank you very much. We hope that we have been able to answer all your questions satisfactorily. Should you need any further clarifications or would like to know more about our company, please feel free to contact us. I once again thank you for taking the time to join us on this call. Thank you.
Thank you, members of the management. On behalf of Balrampur Chini Mills Limited, that concludes this conference. Thank you for joining us and you may now disconnect your lines.