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Borosil Renewables Ltd
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Ladies and gentlemen, good day and welcome to the Q1 FY '24 Earnings Conference Call of Borosil Renewables Limited hosted by Axis Capital Limited. [Operator Instructions] Please note that this conference is being recorded.I now hand the conference over to Mr. Sumit Kishore from Axis Capital. Thank you and over to you.
Thank you, Yashashri. On behalf of Axis Capital, I'm pleased to welcome you all to the Borosil Renewables Q1 FY '24 Earnings Conference Call. We have with us the management team of Borosil Renewables represented by Mr. P.K. Kheruka, Executive Chairman; Mr. Ashok Jain, Whole-time Director; Mr. Sunil Roongta, CFO; Mr. Swapnil Walunj, Head - Marketing. We will begin with opening remarks from Mr. Kheruka, followed by an interactive Q&A session. Over to you, sir.
Thank you. Good afternoon and welcome to the Borosil Renewables investor call for the first quarter of financial year '23-'24. The Board of Borosil Renewables on 8 August approved the company's financial results for the first quarter for the current year. Our results and an updated presentation have been sent to the stock exchanges and have also been uploaded on the company's website. We will discuss the operations of Borosil Renewables on a standalone basis as well as on consolidated basis. I will also provide you some highlights of the operations in a newly formed acquired overseas subsidiaries.During the first quarter of the current financial year, the company recorded a standalone net revenue from operations of INR 237.82 crores, an increase of 40% over the corresponding quarter in the financial year 2022-'23. Sales volumes on a quantitative basis grew by 56% post-commissioning of a new 550 tonnes per day new plant that is to say SG-3 from 23rd February, 2023.Export sales during the first quarter of FY '24, including to customers in SEZ were 30.3% of the turnover at INR 72.13 crores, registering an increase of 82.4% over the first quarter, financial year '22-'23, which was INR 39.55 crores. Out of this, direct exports were up 81% to INR 69.26 crores as against INR 38.17 crores in the same quarter last year.Average ex-factory selling prices during the quarter experienced a sharp decline of 8.8% as compared to the same quarter last year, down from INR 140.8 per mm to about INR 128.4 mm. This lowering of prices is the direct outcome of dumping from China, Malaysia, Vietnam as the domestic selling price has declined by about 16% in the same period. This price reduction must be viewed in the backdrop of a rise in the prices of inputs like natural gas, soda ash, packing materials and other commodities in the year 2022-'23. There has however been some marginal reduction in the input costs during this quarter.Due to low selling prices, the margins have come down significantly in the domestic markets. The last financial year has seen a notable fall in EBITDA from INR 51.3 crores at 30.2% in the first quarter of the last year to INR 38.02 crores at 20.3% in the last quarter. EBITDA has recovered to INR 56.52 crores at 23.8%, with the infusion of production and stabilization of process in SG-3 furnace in the first quarter of the current year.Lower EBITDA and higher outflows towards interest and depreciation led to a decline in the profit after tax and the company recorded a profit after tax of INR 13.64 crores, a decrease of 54.6% over quarter 1 last year. The Indian market for solar glass remains wide open for duty free imports of solar glass from China, which has been having a field day.Meanwhile, imports of solar glass into China face a customs duty of 21%. While the import tariff provides for a basic customs duty of 15% on imports of solar glass, a circular going back to 1999 exempts the imports of solar components, including solar glass from levy of customs duty. The solar glass industry continues to struggle with low margins as heavily subsidized solar glass from China continues to flood Indian market with no pretense of a level playing field for Indian industry. We continue to represent our case rigorously to the government to [indiscernible] the exemption from basic customs duty on imports of solar glass.Coming to the solar installations. Over the last few months, these have remained a little bit subdued at about 0.5 gigawatts per month and for gaining momentum in June 2023 to achieve 2.3 gigawatts. In the first quarter of the current financial year, the installation of 3.3 gigawatts against 3.7 gigawatts in first quarter of the last year. The domestic demand for solar glass has been facing issues ever since the time MNRE suspended implementation of ALMM till March '24. The lower offtake of solar modules led to higher inventories with our customers, which was further exacerbated by used stocks of solar glass due to significantly higher imports than in the expectation of higher manufacturing and demand.On a long-term basis however, the demand situation for solar glass continues to look good in India as a domestic module manufacturing capacity are expected to rise to almost 100 gigawatts in the next 2 or 3 years from about 35 gigawatts currently. The actual domestic manufacturing may rise to 35 to 40 gigawatts annually which will increase the demand further.However, a challenge of lower prices due to dumping has seriously dented the profitability of new plants and also brought the potential expansion in solar glass capacity by various players to a halt. On the policy front, there have been some developments worth mentioning here. MNRE unvieled bidding plans for 50 gigawatts in renewable energy products in financial year '23-'24. And whose quarter-wise timelines for SECI, 15 gigawatts, NTPC 15 gigawatts, NHPC 10 gigawatts and SJVNL 10 gigawatts, 40 gigawatts to come from solar and 10 gigawatts from wind.CEA issues National Electricity Plan that projects 562 gigawatts of installed capacity from renewables by financial year '32. 365 gigawatts of this 65% is expected to come from solar, about 120 gigawatts of solar is expected to get installed between financial year '24 and financial year '27 and 179 gigawatts of solar between financial year '28 and financial year '32. The above generate substantially high demand for solar modules.The solar glass manufacturing furnace in Germany GMB, was in the planned cold repair from 13th March to 5th May and the furnace has been brought back into production from 8th May with a higher capacity of 350 tonnes per day after incorporating changes which will help raise the production yield and achieve energy savings. The remaining CapEx plan for the processing area, which will help achieve capability to supply a larger size glass and also enable more efficient operation will be completed by end of the current quarter.I now come to the consolidated results for the quarter. These results include the operations of the wholly-owned subsidiaries abroad. The Interfloat Group registered a revenue of INR 123.02 crores in this quarter with a negative EBITDA of INR 19.23 crores. The operating results have been impacted due to shutdown of glass production from 13th March '23 to 8th May '23 and suboptimal performance due to lower efficiencies during initial stabilization.The consolidated net review or EBITDA for the first quarter of the current financial year, thereafter, stands at INR 354.5 crores and INR 34.47 crores respectively. We continue to have a positive outlook led by expected growth in the domestic manufacturing and local production of modules in European Union, USA and Turkey. The IRA in the USA and solar module accelerator program in the European Union are looking to create local production of solar modules and components, which will need supply of solar glass.The German Federal Minister for Economic Affairs and Climate Protection has called for expression of interest from company that manufactures solar modules or the key components in the country to establish 10 gigawatts of solar module manufacturing facility, aiming to allocate the subsidiaries for this facility. We believe that with manufacturing operations in Europe and in India, there is a strategically advantageous position to meet higher demand in the export markets.With that, I would now like to open the floor to questions that you may have. Thank you.
[Operator Instructions] We have a first question from the line of [ Mohan Kumar ], an individual investor. Mr. Mohan Kumar?
I have a couple of questions. So the first one is with respect to the efficiency gains that you're expecting to kick in from the furnaces. How long do you feel that could take to properly materialize completely by when, can we see that in [indiscernible]?
I feel that with the constant [indiscernible] significantly improved gains, we have a completely new type of furnace in Borosil and it will take time to fine-tune it. So it's a large installation. And it's not just a glass-melting furnace. It's also a production line, which grinds everything in piece of glass, coats it and then tempers it and then packs it. So that's a fully automatic process. We are well on the way to achieving the rated efficiency now.
That's great data. Congrats on that. And the second question that I have is with respect to the capacity utilization. So currently, do you feel that you are of the higher levels that we saw probably in the last couple of years? Or do you feel there is some slack that can be picked up over the next few months?
I feel that we should be achieving the full capacity utilization in the remaining part of this year and we are working hard at it. Very difficult to give some statement on when this can be achieved. Everybody at work trying to achieve it, so maybe within the end of this quarter, we should be achieved -- we should have achieved significantly decent capacity utilization.
That's great. And do you expect that to split between the Indian markets and the international markets, stay with international markets, where do you see that the -- so what I mean is the rate of change that you're expecting, do you see that higher in the international markets or the Indian market?
I think both the markets are actually potentially very robust potentially. And it is just a question of the standard in the works is coming from the Chinese imports. They have become desperate and they are trying very hard to -- they are trying very hard to create a big, big situation in the Indian market, but I'm sure the government will take action at the right time and be able to find a solution for that.
We have our next question from the line of [ Vivek Gupta ], an individual investor.
I have a couple of questions. First is, what is your EBITDA margin guidance for the rest of the quarters current full year?
You see, we do not give forward-looking projections as a matter of policy.
Okay. As the soda ash prices have been cracking now, so do you eventually see the benefit being passed in the rest of the quarters?
We definitely see some improvement in soda ash prices, but how much is something that is difficult for us to sort of evaluate at this moment.
Just to confirm that whatever the price decline is taking place, we are also getting the corresponding price decline in our cost of buying. So the benefit is getting passed on to us as well.
Okay. Okay. One basic question which I have is, so that this Chinese, Vietnam and Malaysian glass which is being dumped into Indian markets, why the pricing is so low? So what extra they are doing that their manufacturing process is so low that they are eventually able to sell at such a low price?
They have no advantage whatsoever in the manufacturing process. Their manufacturing process is less efficient, more -- they produce more fuel than we do. So this is just a state case of government subsidizing them. And that's why the price of polysilicon has also crashed. They have done nothing to cause such a crash in the price of polysilicon, crash in the price of finished modules, crash in the price of solar glass. Every component, they have crashed the price because they see that the world is now looking at making solar modules and all components in their own countries. The USA, the European Union and India, three large markets are looking at becoming Atmanirbhar and therefore, in order to spoil that, they have been doing all this.
And I see that you are in touch with the government to reinforce ADD. So do you foresee that that decision can be taken soon or you don't see any probability of coming into play?
No, we see, we definitely see a possibility or even a probability because it is strange that the government would only protect 2 out of, say, 5 components which are required in the value chain. So I think this was done in mistake, frankly speaking. Otherwise, there's no reason why they have sought out 2 particular items of protection. I mean, if you want to protect something, you have to protect the entire ecosystem. Otherwise, you don't get any benefit.
We have our next question from the line of Deepesh Agarwal from UTI AMC.
Can you help us understand what is our current price premium to the landed size of Chinese and Malaysian glass?
Mr. Jain, will you answer that question?
Yes. So the pricing premium or advantage or markup which we had in the past, we had enjoyed in the past, has declined in the recent times. And currently, the average price premium has gone down to almost 3% or so compared to 7%, 8% which we were enjoying before. So this is primarily because the cost of making the module, the module manufacturer wanted to be more competitive. And also that we are now supplying larger volume of glass which is going to large customers. Our customer mix profile has changed and our average pricing for large customers is lower as compared to a smaller customer. So that's where the average price has gone down to almost -- or premium has gone down to almost 3%.
Understood. And if I see the power cost on per square meter, it seems it has gone up even sequentially. Can you help us understand what has led to even a sequential increase in the power cost?
So there has been an increase by the DISCOM in terms of the [ SCA ] by about INR 0.38 or something.
INR 0.30.
INR 0.30, which is why the cost has gone up. It's quite surprising that the DISCOM has taken this step to increase the price around this time.
Okay. Okay. And can you touch upon the local competition because earlier you have guided that a lot of peers are coming up which will have a capacity coming up in June, July. So is it that the local competition has started hitting the market?
Well, the 3 companies which have potentially come into production or likely to come into production have not meaningfully started selling any volume in the domestic market yet because they are still struggling to stabilize the production. So hopefully in the next quarter or so they may start selling a certain volume in the market. But as of now the volumes are very limited and coming only from one player, which is very small as of now.
Okay. Also in one of the comments you mentioned that even U.S. is looking for local components for solar manufacturing. Does that mean that Borosil is open to idea of even setting up a facility or acquiring someone in U.S. market?
So we keep evaluating all the opportunities and it will all depend on how economical it is going to be to manufacture in each geography. But we keep evaluating and we'll take a call at the right point in time whether to set up any manufacturing in USA or not.
Okay. And lastly, the BCD exemption which pertains to 1997 circular, that exemption is till 31st March, 2024. Is my understanding correct?
Well, this exemption is valid until March '24, 1st March '24, I think. And this is supposed to lapse, I mean the exemptions are supposed to lapse as of that day. So we are waiting for that. And in the meantime, we are representing to government to end the exemption faster than that, because the dumping is quite serious in terms of the Chinese prices. And we are requesting the government to end the exemption sooner, sooner than March '24.
And so ideally, our margin profile should improve after this exemption is lapsed, even if there is no anti-dumping duty, right?
Yes. So our comparison for the pricing is based on landed costs. So once landed costs will improve the basic custom duty, obviously the benchmark will go up and we will have a possibility to increase our prices.
[Operator Instructions] We have a next question from the line of Bala Murali from Oman Investment Advisors.
I would like to know about that our Germany subsidiary EBITDA margins for this quarter?
Germany subsidiary EBITDA margins to talk about this particular quarter may not be really indicative in the sense the plant was closed for furnace repair, which was planned already and almost for 50% of the quarter the plant was not operating. So after the plant has come into production, say for the month of June, we have improved the working in terms of the production and EBITDA and everything, but it is still not at the full working. We are trying to improve the capacity utilization gradually from this furnace, which was supposed to give 350 tonnes per day, as against 300-tonne furnace, which was operated before. So we will reach this 350-tonne capacity utilization maybe by next quarter.
Okay. Understood, sir. And what could be the -- as the gas prices have come down in that region, so what could be the anticipated margins and expected peak revenues of the 350-tonne per day capacity from the subsidiary?
Sorry, can you repeat the question? Is the question regarding subsidiary or...
Yes, regarding subsidiary only. In Q3, actually, the margin was around 7.5% for the German subsidiary. So now after the addition of 350 tonne per day, what could be the anticipated revenue and margins improvement as the gas prices also have come down a little bit? So what could be the margin profile going forward in that sense?
Like that -- like what we have already said before, we cannot give any indication of the EBITDA margins, but the overseas subsidiary will have lower EBITDA percentage margin compared to the domestic production in India, because obviously the costs are higher in Europe to produce, due to West Indian norms for using the natural gas or oxygen or other things where we have to incur higher cost.
Okay. And regarding the Borosil Renewables, the standalone entity, so had around INR 237 crores in this quarter. So after that optimum capacity utilization, what could be the peak revenues that we can expect from this?
I think we should do at least INR 300 crores per quarter.
[Operator Instructions] We have our next question from the line of Akshay Satija from [ NM Securities ].
So the first question would be, what is the overall CapEx that we are planning to do in the next 3, 4 years and how do we plan to fund it?
So currently we have -- the major CapEx comes by way of capacity addition in this industry and our current plan of setting up additional furnace has been put on hold as of now. So once that is decided and what is the size of the plant, we'll decide how much CapEx we'll do in the next couple of years.On a routine basis, whatever CapEx we keep doing, that may be close to about INR 30 crores to INR 40 crores per annum. And also we will require funding for the repair, rebuild of the furnaces whenever they are due for rebuild, maybe in the next 3, 4 years, any time. That will be another INR 100 crores, INR 120 crores at one go.
Okay. So the next question would be, so what is the current size of -- average current size of the glass that we sell and what portion of it would be the 2 mm size? Is there any profitability difference between those 2 mm and the current maybe 3, 3.5 mm?
Are you talking about the glass size?
Yes, glass size.
So glass size depends on the customer requirement. Currently the glass sizes have become bigger because of the new technology of solar cell which has come into effect, which is like a bifacial cell of M10 or M12. So glass sizes have gone up to 2.5 meters or thereabouts. Our normal, now standard current supplies are about 2, 2.7, 2.11, 28 or like that. But we are capable of supplying even bigger sizes of M12 which could be 2,500 or like that.
Okay. Okay. Is there any profitability difference between these sizes? Is it that the smaller size is more profitable or there is no different glasses?
So we can take all the sizes, the smaller sizes also. We are supplying in the domestic market even very small sizes. And we also have capability to make sizes of 300 by 300 which is very small for roof tiles and other things. So size will depend on what customer wants. We have equipment and capability to manufacture large or small sizes both.
Okay. So I was also looking at one of the Chinese players, Xinyi. So I was looking at their costs. The variable costs for you look similar to us. But the real difference that was causing was the fixed cost that they have. So can we say even if there is no intervention from the government, our scale improves? Maybe we were talking about another 1,100 tonnes per day addition in 3 years. If we do that, probably can you see our fixed costs coming down and without government interventions, we do better margins?
So basically the fixed costs are in 2 major areas. One is the employee cost and the other is the interest and depreciation. So in the case of employee cost, as they have a huge scale, they have a certain advantage. In India, we still have only 1,000 tonnes per day, whereas large players like Xinyi have more than 25,000, 30,000 tonnes per day. So obviously when you expand the capacity, you have the operating leverage and your average cost can come down. So as we have progressed in terms of our expansions, our average cost has been going down. But it is still not comparable with the like the largest player like Xinyi Glass. So there -- when we expand further, this margin improvement will take place in employee cost.In the case of depreciation and interest, I think there is some anomaly here because the Chinese are using Chinese equipment mainly. And whereas Borosil uses all equipment from Europe, which are at least 30% to 40% higher cost in terms of their cost of -- their purchase price. So there is a higher depreciation accordingly for those equipment.
Okay. And so when we mentioned that these Chinese players are getting some subsidies from the government, could you quantify what could be the subsidiaries that they are receiving per square meter? What could it be?
We are aware about 13% cash-back that they get at the time of export. But in addition to that, there are subsidies like they get land free of cost, they get buildings free of cost. Sometimes their workforce is paid half the salary by the state. So that is very opaque. There is no way of finding out. The only thing that we see is that, for example, in the last year, when the prices went up for all the inputs by nearly 65%, the selling prices came down by 25%. So that is, I mean, without subsidy, how would that ever have been possible? So that is how we are looking at it.
Do you see any chances that somehow the government stops doing that from China?
In China? China is an opaque country. Nobody knows what the government will decide. They are driven by very, very large issues. According to some information, they are having some problems in their economy. They have a large debt overhang. They don't know what to do with the debt overhang. And in the past, at least they have given a blanket ban on further expansion of capacity when they felt that people were going ahead because there in China, capacity is expanded by taking money from the banks.And it's relatively simple to say that I can't run the company, you take it over. So the bank is stuck with the assets. And the promoter walks away scot-free. So there is a lot of recklessness in China in that respect, in the industrial arena. And there are so many companies which were very, very large, which are lying closed today. So it's an opaque country, very difficult to figure out.
[Operator Instructions] We have a question from Rishabh Shah from Dalal & Broacha.
So I would like to first touch upon what is the market share of our company in India? And as we mentioned before that the 3-4 competitors are going to come in the solar glass space. So what market share can we expect like for us to be in here? And this is my first question. And my second question is, what is the variable between the Chinese solar glass prices that are being supplied to India and our realized prices? So I just want these two questions, a basic understanding of this.
So our market share in India is about 20% as of now. And with the increase in the market size, this market share will fluctuate. But when the new players come in, the new production from the domestic players come in, whether they will only substitute the imports or there will be expansion in the domestic demand. How much expansion will be there, that we have to see. Depending on that, our market share will play out. So from a current 20%, it's likely to go down, actually, as the market size is going to grow and also the supply side will also grow.
Okay. And about the second question regarding the international players, which are Vietnam, Malaysia, they are selling glasses in India. So what is the price difference between ours and theirs?
So international prices are the benchmark for setting up the domestic prices as well by us in India. So our prices are generally tending towards movement in the imported landed cost. And they are on an average higher by about 3% compared to the landed cost of imports coming from these countries.
Okay. Okay. And regarding the INR 120 crore CapEx, which we talked about before, which we told before, so my question is, what turnover can we expect for that?
That INR 120 crore CapEx is basically a rebuild of the existing furnaces. Every furnace, after running, requires to be rebuilt. So it's a -- maintenance CapEx, you can say. And when you do a maintenance CapEx, you are just reviving the life of the furnace for the next campaign. So production is not likely to increase, but it will be continued. It's a maintenance CapEx, one can say.
But what turnover can we expect for that? And for which furnace [indiscernible]?
Current turnover is basically sustained by repairing the furnace because you put down the furnace, you remove the old refractories and put new refractories and restart the furnace. So it is just maintaining the current turnover.
Okay. Okay. And regarding this INR 120 crores, where are we spending, for which furnace are we spending on?
So we have 3 furnaces as of now. So furnace 1 and furnace 2, which we had commissioned in 2019-'20, after 6 or 7 years, generally the furnaces have to be rebuilt. So maybe in 2026 or so we will have to consider rebuild of these furnaces. Each furnace may need about INR 50 crores, INR 60 crores. So these are the 2 furnaces which we will be planning to rebuild at an estimated cost of INR 120 crores. It's just a rough estimate as of now. As we go along, we will have to figure out what the exact number is going to be.
[Operator Instructions] We have a question from Bala Murali from Oman Investment Advisors.
Regarding this German 10 gigawatt solar manufacturing facility, when do you think that the things will get materialized and does our GMB has any edge over the other suppliers over there to supply the glass to this manufacturing facility?
The expression of interest has been called for by the government from all the interested players. I think the date is 16th of August. And after that, they will review the proposals and then they will decide which proposals merit their help or their assistance in terms of the CapEx or OpEx or whatever nature of subsidies or incentives are required. And in case of GMB, we are the only company making the solar glass without using antimony, which is also part of this 10 gigawatt program that they want glass to be without using antimony.So this leads a very big opportunity for GMB to supply the glass to the German manufacturers. And if we expand the capacity there and get certain assistance from the government, we will receive certain amount of advantage in terms of our capability to expand the production locally. But it will all depend on what is the gap in terms of the imported landed cost and how much assistance is required and how much assistance is the government able to give.So the opportunity is there, but we will need to know in a couple of months after the government decides. We will be taking interest most likely, but this will be coming from the government in due course.
Okay. And even if capacity utilization is not planned immediately, but we can supply from India also?
Yes, we are doing that already because we are fulfilling the German plant capacity and also exporting already from India. So that's fine. But if they want to promote local manufacturing, then of course the expansion has to take place in Germany itself.
Okay. Understood. And what is the capacity of that GMB and how many gigawatts of solar manufacturing they can supply that glass?
So it's about 2.5 gigawatts as of now. And in case we decide to expand further, then depending on the size of the plant, which could be 300 tonnes or 500 tonnes per day like that, the capacity will go up accordingly.
We'll take our last question from the line of Nikhil Abhyankar from ICICI Securities.
Sir, my first question is, what is the realization for the solar glass that we sell in Germany?
Solar glass sale price in Germany is also higher because of the higher cost of production there. And it all depends on which segment and which kind of customers we are selling. On average, the prices are higher compared to the landed cost of imports by about 50% compared to China and about 20% compared to India.
Okay. So around INR 150-INR 160 rupees per square meter?
Yes.
Okay. And sir, also, just wanted to have an industry update. You might be more than asked. If I'm not wrong, sir, around [Technical Difficulty] is scheduled to come on stream module manufacturing capacity in the next year, somewhere around October '25. So how are the plans? Like, are the companies setting it up? Is everything on stream so that our demand also picks up by then?
Can you reframe your question? Are you saying that we should be also expanding in line with the expansion of capacity?
No, no, no. No, I'm just asking whether all the PLI scheme and all the capacities that are allotted in it, are those all plans on stream? Is everything like almost 30 gigawatt of manufacturing capacities will actually get set up in the next year?
Yes. So we actually wanted to expand our capacity by another 1,100 tonnes per day furnace. That was the planning. But unfortunately, this anti-dumping has gone away from August '22. And there is no basic custom duty in place as of now, which is why the domestic selling prices are not so attractive to provide any investment into the further manufacturing, which is why we are holding our plan back. And once we have a clarity on the basic custom duty on the glass, we will again revisit the subject and take a call. Whenever we decide, it will take at least 18 months to start any new production.
Mr. Jain, I think his question is, the other capacity for modules and inverts and wafers, do we have any visibility on that? Whether people have started placing orders and whether people have started, the people who have got the PLI already?
Yes, so we, I mean, some of the players have already started taking effective steps like for example, Waaree Energies or Tata Power or many others. But for many, many additional players, we do not have much information, which are like the new companies. They may be working on those plans. Some of the companies like Renew Power or [ Gru Energy ], we have certain knowledge that they are expanding, they are coming up with their capacities. But for all the companies, we don't have information.
Understood. And just a final question, if I may. The furnace maintenance that we have taken up, you said that it will reduce the cost of production going ahead. And the differential between our and the Chinese import is only 3% now. So is it possible that we will compete against the Chinese import as well after this maintenance is done?
No, the 3% difference is in the selling price, not in the cost. So since we have to compete on the Chinese landed cost, our selling price is higher by 3%. That's what I said.
We have our next question from the line of Bhavin Rupani from Investec.
I have just one question. Sir, do you see -- it is related to pricing. So do you see any possibility of glass pricing declining from here on?
Well, we cannot say with certainty. But I think the current selling prices of China are very, very low. And below these prices, or even at these prices, many of the Chinese manufacturers must be making either breakeven or losses. So we don't foresee the prices going down further. But in a complex world, we cannot be certain that prices cannot go down or go up.
I would now like to hand the conference over to management for closing comments. Over to you, sir.
Thank you very much, everybody, for having participated in today's investor call. We appreciate the interest which investors take. And we are always happy to interact with you for your valuable comments. Thank you very much and goodbye.
On behalf of Axis Capital Limited, that concludes this conference. Thank you for joining us and you may now disconnect your lines.