Praj Industries Ltd

NSE:PRAJIND

Earnings Call Analysis

The Company Reports Improved Margins and Diverse Order Book

The company reported an increase in profit after tax from INR 623 million in Q3 FY '23 to INR 704 million in Q3 FY '24, attributing the rise to better sales mix, increased exports, and reduced one-time expenses. Margins improved alongside. For the 9 months of FY '24, the income from operations decreased slightly to INR 24.4 billion from INR 25.2 billion in FY '23. The order book consists largely of domestic orders, with bio-energy being the major contributor. Important developments include a healthy pipeline of compressed biogas (CBG) projects due to supportive government policies, expected commissioning of a bioplastics pilot plant in the forthcoming year, and anticipation of upcoming orders for the Mangalore facility focused on energy transition.

Profit and Revenue Overview

The company experienced an increase in profit after tax (PAT), reaching INR 704 million in Q3 FY24 compared to INR 623 million in the same quarter of the previous year. This improvement in margin was attributed to a favorable sales mix, increased export orders in the engineering sector, and reduced material costs. However, the nine-month operational income declined slightly from INR 25.2 billion in FY23 to INR 24.4 billion in FY24.

Order Intake and Backlog

The total order intake for the quarter stood at INR 10.3 billion, with a substantial portion (86%) coming from the domestic market. The bio-energy sector contributed primarily to this intake, accounting for 81%, while engineering and PHS sectors provided 12% and 7%, respectively. The company's order backlog as of December 2023 was INR 39.5 billion, with domestic orders constituting 75% of this total.

Impact of Policy on Order Execution

Due to a policy announcement, there was a temporary hold on projects, particularly affecting sugarcane-based feedstock plants, leading to a shift in contract execution timelines. The company is adjusting its customer support in response to these changes to help navigate the new challenges.

Pipeline Development and Competition

The company reported a healthy pipeline for compressed biogas (CBG) projects, indicating a positive outlook for future growth. They acknowledged the presence of competition in this emerging field but seem to view this as a sign of a vibrant market.

Margins and Cost Factors

There was an improvement in margins due to a favorable sales mix and higher export orders, with service orders contributing significantly. Material cost softening also played a significant role in margin expansion. Nevertheless, the executives indicated that the trajectory of margin improvement is expected to continue, albeit not necessarily at the same rate as in this quarter.

Inflation Reduction Act and Sustainable Aviation Fuel (SAF)

The Inflation Reduction Act in the United States sets the goal of achieving 3 billion gallons per year capacity for SAF by 2030. There is a clear opportunity for the conversion of existing ethanol plants to produce low carbon ethanol needed for SAF. Executives mentioned ongoing orders for low carbon ethanol projects and anticipated movement in this area once certain tax incentives are clarified.

Commissioning Delays and International Orders

There were delays in the commercial production of the Genx engineering products, which impacted the receipt of international orders. However, the company is confident that the inquiries and order book for international projects remain robust.

Operational Updates

The company highlighted the operational challenges faced with feedstock supply and stabilization of technology for bioenergy projects. They noted that although these challenges are complex and have taken time to address, they are making progress and expect improvements in the procurement and production processes.

Future Growth Prospects

Leadership expressed confidence in meeting or exceeding the 3x growth target set for FY30, citing strong indicators in bio-energy, SAF, CBG, bio-plastics, and bio-manufacturing. India is considered a preferred destination for SAF production, and the company intends to maintain its leadership in the evolving market landscape.

Earnings Call Transcript 2024-Q3

[Operator]

Ladies and gentlemen, good day, and welcome to the Praj Industries Limited Q3 9 months FY '24 Earnings Conference Call. [Operator Instructions]

I now hand the conference over to Mr. Anuj Sonpal from Valorem Advisors. Thank you. And over to you, sir.

[Anuj Sonpal]

Good afternoon, everyone, and a very warm welcome to you all. My name is Anuj Sonpal from Valorem Advisors. We managed the Investor Relations for Praj Industries Limited. On behalf of the company, I'd like to thank you all for participating in the company's earnings call for the third quarter and 9 months ended of financial year 2024.

Before we begin, let me mention a short cautionary statement. Some of the statements made in today's earnings call may be forward-looking in nature. Such forward-looking statements are subject to risks and uncertainties, which could cause actual results to differ from those anticipated. Such statements are based on management's beliefs as well as assumptions made by and information currently available to management.

Audiences are cautioned not to place any undue reliance on these forward-looking statements in making any investment decisions. The purpose of today's earnings call is purely to educate and bring awareness about the company's fundamental business and financial quarter under review.

Now let me introduce you to the management participating with us in today's earnings call and hand it over to them for opening remarks. We first we have with us: Mr. Shishir Joshipura, CEO and Managing Director; Mr. Sachin Raole, Chief Financial Officer and Director of Resources.

Without any further delay, let me request Mr. Shishir Joshipura to start with his opening remarks. Thank you, and over to you, sir.

[Shishir Joshipura, executive]

Hello.

[Operator]

Hello, Sandip, sir?

[Shishir Joshipura, executive]

Yes.

[Operator]

Your line is unmuted.

[Shishir Joshipura, executive]

So let me start all over again. Good day, everyone. I welcome you to Praj Industries Earnings Call for Quarter 3 and 9 Months FY '24, plus all of you had the opportunity go through our results for the quarter ended 31st December '23.

I would like to start today with a very exciting development. It gives me immense pleasure to share that honorable union minister Shri Hardeep Singh Puri inaugurated the first of its kind, fully integrated alcohol-to-jet SAF demonstration facility at Praj Industries on 20th January 2024. This is a milestone achievement in Praj pursuit of sustainable decarbonization of transportation sector.

Building set production capabilities from biomass will lay payment for making India an exporter for SAF for global aviation industry. Yesterday, honorable finance minister presented the interim Indian budget 2024 with aim to create a conducive environment for business growth, innovation and social economic development. There's a clear focus on leveraging captive resources in the energy mix, which is aligned with the vision of energy independence by 2047.

Initiatives such as phase mandatory blending of compressed biogas, financial assistance for procurement of biomass aggregation machinery are aimed to give boost to the bioenergy sector. The budget has also announced schemes for biomanufacturing and bio-foundry sectors. These will provide environment-friendly alternatives such as biodegradable polymers, bio-plastics, bio-pharmaceutical, and bio-agri-inputs.

These green growth initiatives will facilitate energy security while achieving the climate action objectives of the niche. We at Praj Industries have already envisioned the necessity of biomanufacturing for the energy security and the sustainability agenda.

Coming to the business performance. The quarter demonstrated that our efforts to broad base our product mix has begun to yield targeted results. Our order book maintained its momentum with visible changes in its constitution. CBG, energy transition, climate action, services and PHS have all contributed to this quarter's momentum.

In our domestic bio-energy business, the supply chain dynamics in the sugar sector were changed as the government ordered ban on the use of sugar syrup for ethanol production in '23, '24 supply year with immediate effect. Later, the government revised the order that allowed use of both sugar syrup and B heavy molasses, but with a cap of diversion of up to 1.7 million metric tonnes of sugar for ethanol production.

The government followed it up by announcing an incentive of INR 6.87 per liter for encouraging ethanol production from C heavy molasses. In order to promote alternative feedstocks, the government has also made an upward revision in price by INR 5.79 per liter to 71.86 per liter for ethanol produced from maize.

Due to this policy changes, we witnessed a very unusual quarter with no order finalization for the sugar-based ethanol plants. However, we strongly believe that this is a temporary situation. Praj has already developed solutions for mitigating the feedstock challenges for our sugar customers. We are working with customers on converting their existing single feedstock plants to multi-feedstock.

We are confident that these solutions will help restore the opportunity next year. Though the sugary-based inquiries could result into orders, we witnessed steady flow of start feedstock-based inquiries getting converted into orders.

On international front, global biofuel alliance is developing positively. 22 countries and 12 International countries are now part of GBA. Praj has already initiated dialogue with 10 countries and has interacted with over 7 organization.

Low carbon ethanol opportunity in the United States continues to be viable. However, clarity on Section 45Z of Inflation Reduction Act in the United States is still awaited. This is resulting in delays in decision on capital expenditure for these projects. These clarifications are now expected before June of '24, which can help us in converting our energy contracts with supply of equipment in second half of FY '25.

We have intensified our focus on growth of service business in both domestic and international markets. We are in the process of establishing a strong distribution network in chosen markets to offer entire suite of solutions compromising of enzymes, yeast and performance enhancer.

On 2G front, the IOCL plant recommissioning is underway. In every 2-stage program at IOCL, we will establish the performance of plant in the first quarter of FY '25. As for CBG, the business landscape is evolving positively. The government has announced CBG blending obligation CBO that mandates blending of CBG in CNG and PNG from FY '25, '26. CBO mandates are expected to increase gradually from 1% in FY '26 to 5% from FY '29 onwards. This will encourage an investment of around INR 37,000 crores. Then facilitate establishment of 750 CBG projects by '28, '29.

We have received 4 orders, which were part of the 5 project line, which is one of the conglomerate. We are now witnessing positive developments on overall enquiry pipeline in this segment. Energy transition is a very important growth agenda globally as well as for our engineering and modernizing business. I am glad to report that almost 2/3 of our order books for this business are now from the energy transition and climate action segment.

Our work on GenX facility at Manglore is in full swing. We have completed all statutory compliances for commissioning -- for commencement of our operations. We expect to start the commercial production activity by mid-February in this facility.

Our creative business witnessed development of strong order book that has already crossed the entire order booking of FY '23 in the first 9 months of FY '24. We received first international order for high-capacity fermenters as well. We also completed the first order for the water system for lithium and battery projects that has very similar requirements for water like semiconductor application.

The zero liquid discharge business is experiencing healthy inquiry inflow now, which well we are very close to build our first modularized [indiscernible] plant, we have received the next order as well, and we have discussion -- in discussions with industry for several customers to further take this offer forward.

Earlier, I mentioned about the union budget provisions to boost bio-manufacturing and bio-foundry sectors. Praj has always believed to invest in unfolding futures. And in line with that, I'm happy to share that the installation of our demo plant for PLA is nearing to completion and we expect the demo plant operation to start by April '24. Overall, the business outlook continues to be positive for our business.

Before closing, it gives me immense pleasure to inform you that Dr. Pramod Chaudhari has been conferred with the coveted Atal Sanskruti Gaurav Award '23 that recognized individuals who have demonstrated exceptional dedication and contribution towards a sustainable excellence.

With this, I will now hand over to my colleague, Sachin, for his comments on the financial performance.

[Sachin Raole, executive]

Thank you, Shishir. Good day, everyone. Let me take you through the financial highlights for the quarter and 9 months ended December 31, '23.

The consolidated income from operations stood at INR 8.28 billion in Q3 FY '24 as compared to INR 9.11 billion in Q3 FY '23. EBITDA has increased by 7% and stood at INR 919 million in Q3 FY '24 as compared to INR 859 million in Q3 FY '23. Similarly, profit after tax stood at INR 704 million in Q3 FY '24 as compared to INR 623 million in Q3 FY '23. We have seen an improvement in margin in this quarter because of sales mix, higher exports in engineering that is service orders and softening of material costs. Also, the decrease in onetime other expenses and lower site activities during this quarter has also contributed in the higher margin for this quarter.

For 9 months FY '24, income from operation was INR 24.4 billion as against INR 25.2 billion in 9 months of FY '23. PBT stood at INR 2.5 million in 9 months of FY '24 as against INR 2.1 billion of 9 months FY '23. PAT of INR 1.9 million as against INR 1.5 billion for the 9 months of the last year. Export revenues accounted for 21% of Q3 FY '24 and of the total revenue, 71% is from bio-energy, 21% from engineering and 8 percentage from PHS business.

The order intake during the quarter was INR 10.3 billion with 86% from the domestic market. Of the total order intake, 81% came from bio-energy, 12% from engineering and balance 7% from PHS before. The order backlog as of December '23 is at INR 39.5 billion, comprising of 75% for domestic quarters. Cash in hand as on 30th September is INR 6.4 billion.

I now conclude my remarks, and I would like to thank you all for joining us on this call. We would now be happy to discuss any questions, comments or suggestions you may have.

[Operator]

[Operator Instructions] The first question is from the line of Amit Anwani from PL Capital.

[Amit Anwani, analyst]

First of all, congratulations for the decent set of numbers. My first question on the sugarcane-based feedstock plants. I just wanted to understand the revenue loss, which might have happened this quarter, the quantum? And will there be any impact in 4Q? And as you said, we've got no orders on that front. So just wanted to understand the perspective order prospects. What could be the quantum of loss, which can happen because of the sugarcane-based feedstock plants?

[Shishir Joshipura, executive]

So Amit, what happened on the revenue side is that there is a -- because of the policy announcement, there is a clear shift, as I would call it, a temporary hold. Obviously, customers had to reassess their projects. The bankers had to reassess the funding that they were making.

So since the time period is very short from announcement to the time we actually -- the quarter ended. So it has led to a situation that contracts have got shifted in execution. So they have not gone away. They have shifted in execution cycle.

And normally, the plants that we designed for sugar sector has either a molasses CH feedstock or BH feedstock. And then there is a separate plants, which can also CH feedstock. So depending on how the customers are chosing their project, but they had to reassess from the perspective of their feedstock situation in terms of what the -- what opportunities they work with. And obviously, this has led to a temporary shift of the time line for the project execution.

In terms of our own response, we decided that we will enable our customers to meet the challenge differently. And therefore, Praj related solutions, which now allows them to go to multiple feedstocks and not necessarily just stay limited to sugary feedstocks. So we have offered solutions, which can combine sugary and starchy or sugary and starchy [indiscernible] terms of the gas.

So we have now different solutions that are being offered to customers. They are all trying to understand their own supply chains on the feedstock side and then they'll obviously realign their projects. So this is a, as I would call, is a short-term adjustment that is required, but we don't believe that because the ethanol demand continues, and therefore, we are sure that industry will find a solution based on our technology offerings to move forward.

[Amit Anwani, analyst]

Sure. And so wanted to understand on CBG, we already got 4 orders. So now I just wanted to understand any assessment on the pipeline for the next 12, 15 months? And also wanted to understand, though there are policies surrounding this by the government because of the promotion of biomass. Is your experience with the current customers, is there a stronger viability, which can shape up in coming quarters? And what is the current IRR on net aspect, if you can highlight?

[Shishir Joshipura, executive]

So as you rightly said, the numbers that we reported include the 4 contracts for CBG in our order book. As we move forward, we see a healthy pipeline developed for the CBG projects to be in the field. There are, again, as I was mentioning earlier is that, the key question that every customer or project [indiscernible] trying to solve is accessibility to feedstock. And that is why you probably see the budget as well that there is a clear provision made for by the government indicator that they will also provide assistance for collection and establishment of supply chain by the feedstock side.

So we clearly see a very positive development and a healthy pipeline for the CBG products as you go forward. The CBO announcement that I also mentioned in my opening remarks will also give a positive push. Typically, these projects would take anything between 12 to 15 months to come fully online. And from that perspective, I think the financial year '25, '26, we are 12% of blending has been announced, we'll offer that it gives them necessary when we needed for development of projects for the promoters.

[Amit Anwani, analyst]

Sir, lastly, on the bio-manufacturing, which government announced and we have been working since quite a long on bio-plastics. So any assessment in what shape it is going to come whether it will be demo plants initially with the PBT mode or any assessment with respect to Quantum or the investment, if you would like to highlight?

[Shishir Joshipura, executive]

So Amit, there is no details of the policy announcement made available yet. That is the fact. However, having said that, I think what's important for us to notice is to see one. There is a clear intention to promote bio-manufacturing and bio-foundry. That's the direction in which the policy will move. That, I think, is a very, very positive development.

And the second point that I would like to mention here is the fact that as a leader in this business, we recognize this opportunity developing much ahead of its time. And therefore, we are able to anticipate the -- put R&D money behind development of solution. And now we're even putting our pilot project, as I mentioned, which will get commissioned in first quarter of next year -- next financial year.

And I think that's all that well because we are now setting the pathway for the unfolding future if I can use that word. And we are very, very positive and very excited with this development in the budget.

[Operator]

And the next question is from the line of Prathamesh Sawant from Axis Securities Limited.

[Prathamesh Sawant, analyst]

Sir, my question is with respect to the CBG again. So you mentioned we have a INR 37,000 crore opportunity. I just wanted to understand, so what kind of a competition will be facing in this front. So can we expect a similar market share like we had in bio-ethanol where we had 66%, 70% market share. So do we see any competition here? And if yes, who are the competitors?

[Shishir Joshipura, executive]

So Prathamesh, first of all, I think the sector is now got a visibility of a growth path, which is very important, the CBG policy actually create the pathway for sector to grow, which is a very, very important thing. The second is that when an opportunity arises, obviously competitive forces will come into play. CBG, the technology in several parts of the world.

Not exactly in the same kind of a scheme that Government of India has got but that is very, very unique. But in terms of basic technology construction has been present in different parts of the world with different feedstocks. We ourselves have built over 60 plants in India where biogas is produced by treating of effluent in distillery.

So as we stop ecosystem develop, I think different solutions will come out, now the [indiscernible] rice straw based gas plant. So depending on how the supply chains on the feedstock side develop, I think we will see a clear development on the CBG side as well.

In terms of competition, yes, there is competition. And I think sometimes in the presence of competition in a very new emerging field is also a good sign because that shows that the potential is really and truly there. It's not just one person's imagination.

And the third is also equally important in the market. I think market share will develop over a period of time. I think all of us will try and I'm sure all of us will find a customer who will buy the story that we put out as an organization. But what's important is to actually go out in the field, improve this performance and promises.

And depending on how is technology performs, I'm sure the market share will build based on competitive dimension. So to comment on market share is probably a little bit early, but we are very excited with potential that this opportunity now promises.

[Prathamesh Sawant, analyst]

Great news because I believe we had announced something prior that the Rengas Technology has highest yields in the market. So...

[Shishir Joshipura, executive]

Yes. It is. Yes, right. Yes, it has. The point is that eventually, the market share is a function of time as well, right? We have to go through this. Now that the potential pathway at least appears to be much more clearer than it was before.

We are sure that as we travel along, we'll talk about it as we build this year. We have no intention to be anything but delivering the business.

[Prathamesh Sawant, analyst]

Sir second question is, with respect to your successful [indiscernible]. So sir, are we seeing any interest from U.S. economy post that in new demand for ethanol plants since you have a proof of concept now in hand.

[Shishir Joshipura, executive]

Sorry, could you just repeat the question?

[Prathamesh Sawant, analyst]

Since you have a proof of concept with respect to the SAF fuel now, so are we seeing any upgraded traction in the U.S. economy and Europe economy projection on plants?

[Shishir Joshipura, executive]

Okay. So in the United States, the Inflation Reduction Act has actually set a goal of creation of 3 billion gallons per year capacity for SAF by 2030. Now of this -- I'm just putting some rough numbers out. So of the 3 billion, about 1.6 billion is expected to go on the HEFA route. But beyond that, there is no feedstock for HEFA route. The balance 1.4 billion is likely to be on what's called alcohol to get route and where ethanol will obviously play a very, very probably the most important role as we move forward.

The ethanol that is required to -- for this said production needs to -- cannot be this normal ethanol. It needs to get to what is called as a low-carbon ethanol status. So there are already a lot of ethanol plants in United States and the capacity exists on the ground.

But now they need to become low carbon ethanol. So that gives the opportunity to convert those plants into low carbon ethanol. And as I was mentioning, in the last quarter, not the December quarter, but in the quarter ending September -- in the quarter ending September, we announced our first order for creation of a low-carbon ethanol solution for an upcoming project in United States. So that was the one that we announced.

Also because for every gallon of -- or every liter of SAF that we need to produce on alcohol to that route, will need the price volume of ethanol. So for every 2 liters of ethanol, we will be able to get 1 liter of SAF. So it does create a very significant opportunity. As I mentioned, there are some clarifications that are required under the IRA when the incentives were given by the government from the -- their internal revenue service on how the calculation for taxation [indiscernible] 45Z provisions, as I was mentioning, which had expected to be clarified in about 4 to 5 months' time frame.

As soon as they are clear, I think we'll see the next movement forward.

[Prathamesh Sawant, analyst]

Okay. And sir, last question from my end with respect to the margins.

[Operator]

Prathamesh sir, sorry to interrupt. Can you please come in the loop for your further question? The next question is from the line of Mohit Kumar from ICICI Securities.

[Mohit Kumar, analyst]

My question is on the CBG. Are we seeing more enquiry? Or do you think this is still some time away until the time their first plant is commercialized and we can see a slightly higher number, maybe end of FY '25 when the first plant -- first of our plant starts producing.

[Shishir Joshipura, executive]

So Mohit, I will give the answer in 2 stages. One, the CBO program is announced from FY '25, '26. So it's still a little away and it will take that kind of time frame to build a plant and actually create the capacity in the country. So we expect that as we move forward through the year end and maybe to later part of the year, we'll start to see a much more healthier and volume development as far as inquiry numbers are concerned.

In terms of commissioning the project, we have already commissioned, as I was mentioning earlier as well, there are about 50 projects that were commissioned on the strength wash waste, which comes out of -- which is the waste coming out of slurries, which where we can produce the CBG. We've also commissioned on price match. So that is also there, and we are also in the process of commissioning based on rice straw.

So all the 3 major groups of feedstock that are currently known are being covered and we are building other 4 where some newer feedstocks like cotton stock, [indiscernible] et cetera will also come into play.

So as this ecosystem starts to develop there right as more and more projects come on the ground, probably that we create a higher degree of knowledge and learning about what needs to happen on the overall ecosystem. So we will definitely see a positive development as we move forward.

[Mohit Kumar, analyst]

As we spoke about the U.S. opportunity, you said 3 billion SAF by 2030. Is there any intermediate target? Does it mean that is a 2030 target, we get the IRA clarification. It may or may not happen given that the U.S. -- the election in the U.S. and this may get delayed, which means that we may not see a material order inflow from the SAF opportunity in FY '25 also?

[Shishir Joshipura, executive]

Mohit, that's a very good question. There is no intermediate target, however, there is an international agreement that has been signed. United States is signatory, India is a signatory. They are starting 2027, 1st January 2027. 1% blend increasing every -- over period of time to a 50% blend will start and it will be obligatory and mandatory for all the airlines to follow. So that is going to create a definitive market.

Now -- so from the market side, there's going to be a definitive pull that the SAF demand will emerge. And if the market size is a full, I'm sure that the capacity will start to get created. This -- the clarification under 45Z that I mentioned about is an important one because that changes very significantly and very favorably the economics of a project, and that is why it is critical for customers.

We are right now working on several engineering projects. So customers said, okay, let's get the engineering part done, let's say, the visibility report done so that when this notification comes as is expected, then we can start the project and don't lose the time right now.

[Operator]

And the next question is from the line of Ankita Shah from Elara Capital.

[Ankita Shah, analyst]

Sir, my question was on margins. So giving that a good sales makes improve export and raw material positively aided the margins performance for this quarter. How do we see in going forward we will likely to continue? And given that our export orders should increase post new plant commissioning. So do you think we should sustain going forward?

[Sachin Raole, executive]

The reasons, which I mentioned earlier on the margin improvement are yes, mainly on the sales mix, export orders coming up in a big way as compared to the normal orders when your services products have contributed. And one major component, which we need to definitely look at and if you look at my last year -- last December quarter results, we have seen the great impact coming up on account of softening of the material costs.

So there are some elements, which will definitely continue to give us the release on account of improvement in the margin. And there will be some which might come back. For example, I mentioned that site activity was less as compared to the last quarter, which may come up in the next quarter.

So the trajectory for our margin going forward is going to be definitely on the improvement path but not necessarily in the same proportion. There might be some here and there. But yes, the margin improvement, we will be keeping in the coming quarters also.

[Ankita Shah, analyst]

Got it. And how is the order inquiries for the new plant that is expected to commission from next quarter onwards in Mangalore. How are the inquiries building up for that?

[Shishir Joshipura, executive]

So I think that's a great question. So what we are seeing now is a clear change to diversification of our order book and energy transition and climate action is a very, very big part of our new dimension and that's where Mangalore facility will be serving this particular need. The inquiries is building up very, very well for this in line with our expectations. And we see no reason to be -- or any cause of concern. We actually are very optimistic that this will continue to develop positively because this is energy transition is a very, very real phenomenon especially in the Western part of the world.

[Ankita Shah, analyst]

Okay. And sir, I remember, you were mentioning about the pilot project for the RCM bioplastic plant also, which was underway and expected to start production. So any update on that?

[Shishir Joshipura, executive]

Yes, Ankita. So as I had mentioned little bit earlier as well, we foresaw this need for developing an indigenous technology for bioplastics. And our PLA project is from which we had announced the capital expenditure at the earlier part of this year is absolutely underway, and we expect that in the first quarter of the next financial year, we will be able to commission and demonstrate. And then, of course, from there onwards, take it to business development.

[Operator]

And the next question is from the line of Shailesh Kanani from Centrum Broking.

[Shailesh Kanani, analyst]

Yes. Sir, I wanted to understand out of this bio-energy order book, what we have around [indiscernible] countdown would be a slow moving. And also the order inflow for this quarter INR 400 crores I assume is from the CPG order. So what is the remaining INR 450-odd crores, which we have bought.

[Sachin Raole, executive]

So Shailesh, first of all, let me start in the reverse order. So as we mentioned that this quarter was a very different quarter in its constitution because we did not see any sugary feedstock-based ethanol projects getting finalized during the quarter, first reason that we already elaborated. But the starchy feedstocks continue.

So what you see is that the other half that you mentioned is about the starchy feedstock-based order book that continues to build. So there is no let up on that part. It was just that as we mentioned that there could be a small 3, 4-month kind of a recalibration that is required for the projects that were solely syrup based because of the change in environment. And a lot of industry is now thinking saying, do I need to go and diversify to multiple systems, et cetera. So that is the impact that we're seeing.

[Shailesh Kanani, analyst]

And the slow moving part of this INR 3,000 crores order, order backlog?

[Sachin Raole, executive]

Yes, that's right. INR 39.5 billion order backlog is what we are seeing. Your question is related to?

[Shishir Joshipura, executive]

How much of this...

[Shailesh Kanani, analyst]

The biology part, which is roughly around [indiscernible] crores. So how much of that would be a slow moving, which will not be incrementally contributing to our revenues?

[Sachin Raole, executive]

Related to this syrup base plants, the order book size is around INR 250 crores.

[Shailesh Kanani, analyst]

And B heavy would be?

[Shishir Joshipura, executive]

B heavy will be another INR 450 crores kind of a thing. But Shailesh B heavy also has a C molasses built into that price. It is not a single feedstock plant, okay?

[Shailesh Kanani, analyst]

So that means that would still continue as [indiscernible].

[Sachin Raole, executive]

Yes. So pure syrup projects is what Shishir was mentioning at about INR 250 crores. They obviously have delayed execution now. But other than that, it is B than B is also with a C. So that you can alternate the feedstock that already. And -- many customers are now opening the dialogue to say, all right, apart from this, can I connect starchy module to this. Can we discuss even bio-gas-based ethanol [indiscernible] feedstock is critical to this. And that is effort that we have already made anticipating this kind of need. So we are able to offer a solution to these customers and I am sure that this will help them overcome this challenge.

[Shailesh Kanani, analyst]

Fair enough. Sir, my second question was with respect to our international order inflow and [indiscernible] as well. So there has been some disappointment there in the quarter. And so is there any component in the international order book, which is slow moving or has a longer gestation than what being longer execution period than normally what we have in the past?

[Shishir Joshipura, executive]

So on the international order book front, yes, there were some minor shifts in the order booking cycles, but the inquiries are very much healthy. They have all stayed. We do not foresee a situation where the pipeline is anywhere near. In fact, it's only filling up. I can't even use the word trying up because it's only filling up for more and more.

So from that, the energy transition is a year phenomena. We clearly see as we move forward, yes, being project business in nature, sometimes time lines may be one quarter here or there they not exactly aligned to the calendar month, as we would like to do it or Sachin would like close by year on 31st of December, so that may not happen. But more than that, I think what's important is the pipeline stays healthy and growing from the targeted segments and customers, and we have absolutely no reason to belief that we will have anything but success in that department.

[Sachin Raole, executive]

And Shailesh, one more thing regarding to engineering international orders, our Genx has taken almost one more quarter for coming up for the commercial production. So it has taken some kind of a time for trying for arranging the customers busy at getting their approval and all. That is also one more reason for engineering orders from the international side taking some kind of a delay of almost a quarter for that matter.

[Shishir Joshipura, executive]

Thank you, Sachin for that. That's a great point. Yes.

[Operator]

And the next question is from the line of Sandip Sabharwal from AskSandipSabharwal.

[Sandip Sabharwal, analyst]

My question was specific to the second-generation ethanol plant, which have been under execution for a very long time now, even the Panipat plant, which you're seeing will be finally into commercial production by the first quarter. Now the feedback from the company, the oil mark oil company, which you are executing is that the technology has not stabilized and the commercial production is not happening despite so much time then passed. Can you just give some clarity on this, what's happening on that front?

[Sachin Raole, executive]

Sure. So yes, I mean, delay is something that is visible to all of us. So there's no denying of the site that probably still get a delay from the original target that we had. However, what's important to understand is that, a; the challenges of feedstock supply chain, and I did mention that even in the earlier part, the government has also recognized the need to establish and support establishment of a supply chain in the feedstock side.

So one is the physical availability of the feedstock, that itself because you appreciate that in the whole 365 days of the year, the feedstock is only available for 15 days in a year. So we have to make arrangements for the rest of 350 days for it to be stored and used, et cetera, et cetera. So that's one clear dimension that has been learned as these projects were getting commissioned.

The second is about the quality of the feedstock because there are -- one has to understand there is a feedstock that is available today. And then 1 year down the line when the demand for that feedstock goes up, how do you ensure that the quality of the feedstock is correct. That is the second one.

The third is, of course, the varying degrees of quality inputs, how do you stabilize the plant. What is important is as far as process is concerned, we have through an end-to-end, you put the stock at one end, you do that acknowledge at the other end, and there is absolutely no problem. We have already produced over 1.5 lakh liters of ethanol in that project.

But now overcoming these situations, we have now agreed on a plan with our customers -- with Indian Oil in specific to go through that they would like us to go through 2 states in recommissioning of the project. That is what we are doing. And that's why I mentioned that first quarter of next year, we'll see that happen. We are already working on it. It's not that we'll start somewhere now. Our team is already there, and we expect the results in February, we'll see it in 3 months time frame the project open, okay?

[Sandip Sabharwal, analyst]

But then taking it up further, like when such a big order is placed by the customer, wouldn't be obvious that they would think through the feedback issues at that stage and not 5 years after the project was awarded?

[Sachin Raole, executive]

Well, the point is that this is very new. There is no precedence. There is no supply chain and service. You would agree with me that the only way this [Foreign Language]. So from completely destroying it in one shot to light up a match. We are not seeing of establishment. So it does take time. This has experience worldwide, it's not only in India. So I think the feedstock is clearly understood because there are different dimensions to it as to who harvest the feedstock at what cost, who pushed the capital, who push the land, who stores it, who supply. There are different dimensions to this.

And I think some of the dimensions were very complex in nature. And I think now there's a clearly better understanding that is emerging and we will see the results soon.

[Sandip Sabharwal, analyst]

And secondly, on this biogas plant, which has been just inaugurated in UP where there was mentioned by the oil minister also. So for that plant, has the production stabilized?

[Sachin Raole, executive]

Sorry, could you just repeat your question, please?

[Sandip Sabharwal, analyst]

Yes, about the new plant in UP, which was just inaugurated by the oil minister on the compressed biogas, does the production stabilized for that?

[Shishir Joshipura, executive]

No. So just to share with you from the day you inaugurate that it is cost start, the cycle is almost a 90-day cycle by the time you go to a stable production level because that's the bacterial cycle declaration of biomass. First start, we'll take that one after it is obviously a continuous process.

[Sandip Sabharwal, analyst]

So this order was for HPCL, right? HPCL also announced 8 more plants in UP. So are you in line to get any of those?

[Shishir Joshipura, executive]

Time will tell. Time will tell. We need to first commission this one and prove it to them. And they are now -- they have announced it, but obviously, it's a public sector, so they like to go through a procurement process. We will wait for it, and we are sure that we'll stay competitive and will.

[Sandip Sabharwal, analyst]

Okay. And out of the 900-odd plants, which might be planned over the next few years, what do you estimate like how many private sector will do and how many the public sector will do?

[Shishir Joshipura, executive]

Tough call. There is -- I think these are initial days. So for me to sit on a crystal ball and say, private will do so much, public sector will do so much. What's important, though, is that both the sectors are building the plants. And to me, that is a good sign. It's not that only a public sector is building or only private sector is building, which clearly host a show that there's a clear future for this form of solution, that there is a liability for these projects.

And the good news is that there are several large conglomerates, both in private and public sector side were supporting this and are partaking in this. So I think from that perspective, it's a very positive sign. But what would be the distribution between 2 of them? Only time will tell.

[Operator]

And the next question is from the line of Manish Beria from Investor.

[Unknown Analyst]

So we are trying to become a long-term investor of gas. So I just wanted to understand, I mean, if you can just build help us build conviction. If you reiterate your FY '30 target, I think you have said about 3x revenue. So is that still achievable? That's the first.

The second is on the margin. So we're almost reaching double-digit PAT margins. So is this something we should look forward with more export that is higher margin and also services contributing more? So double-digit margin is possible or not?

The third is, I mean, we are less capital intensive. I mean the ROC and things are very good. So what will be our capital allocation policy like dividend, buyback or an infusion, what I mean. So what will be our capital allocation there?

[Shishir Joshipura, executive]

Manishji, so let me start first. We have absolutely no reason to believe that we will not meet or beat our target that we set out of 3x growth. In fact, if you go and see, we were saying some things in that conference as well, where we had set out a vision for the company. Said an important segment was around biomanufacturing. And we are delighted that the government has also indicated the same in their policy direction as well.

So in bio-energy, already, there's a big push. Sustainable aviation fuel, there's a big push. The global CBG, there's a big push. Now on the bio-plastics and bio-manufacturing, there's a big push. So all the factors that we are serving and where we have a leadership in the business and market -- domestic market as well. Very clearly, the indicators are that those are all potentially growing pathways.

And I think if the business is growing, obviously, no reason to believe that we will -- as I said earlier as well that we absolutely no intention to give up on our leadership position.

Internationally, as well, we see 2 -- one is the SAF, which will drive development of capacities worldwide, United States to start with India. There are several other factors that favor India as preferred destination for SAF production, and we will talk about it as we travel through the year over the next 12 months.

The next point that I want to make with you is that the global biofuel alliance that I mentioned in my opening remark, has become a very, very strong platform. Already 22 countries are a member and our -- and all the important organizations that needs to be part of an ecosystem to make things favorably develop are already the member. We are already in dialogue with several -- I think if I remember the number correctly kind of number of countries to see how we could develop -- help them develop their own environment programs and how what role can technology play.

So everything that is in terms of potential, in terms of landscape, in terms of pathways is positively developing.

In all our business areas, there are more business areas around energy transition that I already mentioned. That is also developing very, very positively. And we expect that, that will become a very, very significant component of our business numbers as we move forward.

So fermentation is going to become a big technology. So that is the core sense of trade. So several our businesses, not only in the energy side, bio-energy, renewable chemicals and materials, PHS, all of them will benefit from with strong core strength of trade, which is fermentation.

So overall, both even international markets and domestic markets, the drivers are all in positive direction. We expect that -- and that is also confident that 3s direction guidance that we will be met without any problem.

Coming to your second question was around the margins. We remain confident, as Sachin already explained that -- and I'm saying this that we have -- margins don't happen overnight. So we've been working very consciously at improving our margins over a period of time.

Several actions that we have taken in terms of changing product mix, focusing higher on international, getting a higher role for technology. Of course, softening prices of raw materials also help, no question about it, compared to the period 2 years ago. We have also seen this particular quarter where the site a little less, which is a little less margin business for us going down and maybe they'll go up again in the fourth quarter, again, in terms of market dynamics changing.

So it's an overall mix. We will -- we are very confident that we'll continue to be positively developing as we move forward. The move, it may have different quantums of change, but all the quantums will be on the positive side, that is a confirmation and complement.

[Unknown Analyst]

And on the capital allocation?

[Shishir Joshipura, executive]

Yes. On the capital allocation side, I don't think I can play the role of my entire board because this is a board matter to be discussed into how we will do about, go about allocating our capital.

What's more important is for us to understand is that we will continuously be focusing on development of the new because we strongly believe that the whole renewable chemical and materials landscape will start to unfold in front of us in mid-to-long term. And that will call for investments now.

So we will -- we'll make sure that we don't shy away from those investments and we make prudent investments. So a lot of our capital allocation will go towards building capacity and capabilities, both in terms of what happened to dividend prices not for me to discuss. It's a Board matter. So as and when that comes up we will let you know.

[Operator]

[Operator Instructions] The next question is from the line of Faisal Zubair Hawa from H.G.HAWA & Company.

[Faisal Hawa, analyst]

What is the kind of R&D spend that we are targeting going forward? And secondly, if there is this one product, which we are still not marketed enough or we are not getting enough traction. But you feel that we see that this will succeed big time. What could be that product and is there some target within the company also that new products should at least contribute like 1/3 or 1/4 of revenue 3 years hence?

[Sachin Raole, executive]

So on the R&D spend, our momentum will continue Faisal ji because...

[Faisal Hawa, analyst]

Can you give a percentage to it?

[Sachin Raole, executive]

I will not be able to give exactly percentage per se but I will say that we are looking at for the next year, the CapEx in the range of, again, maybe INR 30 crores to INR 40 crores. The revenue expenditure, which will be mainly on the development side and the facility, which is coming up now our PLA. Another INR 30 crores to INR 40 crores will be investing on the OpEx side. So total investment, which will go in R&D in the next year will be in the range of INR 70 crores to INR 80 crores, whatever will be that percentage of my next year still lower.

[Faisal Hawa, analyst]

I'm sorry about the blockbuster product that could come up and whether we have any kind of strategy with the new products.

[Sachin Raole, executive]

So when you're talking about new products, if you look at starting from second generation to CBG to SAF and now PLA, these are the new offerings, which are coming up in the market from our side. They are, of course, at different stages of commercialization. But we believe the potential and I'm sure you also believe the potential for all these segments is pretty, pretty huge going forward.

For example, CBG, we were talking about CBG since last 2 years, and now it is really taking its roots. And if you look at the technology, naturally we were developed at towering and technology is absolutely unique from the form of the yield, which someone was already mentioning about or from the preservation of fixed stock. There are many unique features, which we have introduced because of our R&D development on that side.

Same thing is happening on SAF. We just mentioned about inauguration of our fully integrated demo plant, which is one of its kind, it showcases the entire end-to-end kind of a production capability, technology and facility, which can be built up. And the base part, it is on a modularized form.

[Faisal Hawa, analyst]

Are you doing anything to improve our branding at an international level where we know you could stand strong against in Japanese suppliers and really build up a large amount of trust? So any kind of branding initiatives that we are going to do this? I know it's a B2B business, but still on...

[Shishir Joshipura, executive]

Faisal. I think it's a great question. We are very conscious in ensuring that our brand presence is felt and what better to say the proof of this then to say that the mobile equivalent of price equivalent of bio-economy, which is the Carver Award was awarded to Dr. Chaudhari, who is our Chairman, and who is the only non-American to have received this award over the years. So and that's treated as noble of the industry. So -- and there have been several other accolades that have come out, whether it was on Bloomberg, whether it was to biofuel digest.

So in relevant platforms, we are making sure, a, that we are known, we are present in those forums. We are contributing to those forums. We are a go-to company when people think of customized solutions. We are their go-to company and people think of multiple feedstocks versus world. Yes, when it goes to the whole W, the entire effort that G20 conference launched around worldwide alliance Global Biofuel Alliance that is something that we are playing the role that is expected of us.

We are contributing in any which way we can. Of course, our customers are our biggest embedded us. So in countries of over 100 countries, over 100 countries, we have plants and solutions that we established. Those guys are our real ambassadors in respective geographies. So yes, as you rightly said, we are not a B2C company, so you will not see us doing a jingalala on television. But surely, there is -- there are forums where we make our presence felt to contribution that we need and the participation that we do.

[Faisal Hawa, analyst]

It would also help to have a much better link in because there our [indiscernible] not very regular. And secondly, sir, is there anything that we plan to do on the waste-to-energy front also because that could be also a very big sector in India. Has backed very big project also from [indiscernible]. So do we have a very good product there also?

[Shishir Joshipura, executive]

So we have a lot of focus on what we call as agri waste to energy. Obviously, those CBG is a solution in that space, second-generation ethnology solution in that space, even first generation ethanol for that matter.

Our energy transition and climate action solution of modulization has -- within that business, there is a segment of H2 energy where we are working with some of the companies in the world. And I think Sachin mentioned that there, our ability to conceptualize a process to engineering solution and then convert that to a modularized solution is something that is finding a lot of takers.

So different strokes maybe, but yes, definitely, waste energy will also be here. But right now, there is no plan at our end to work on municipal waste energy projects directly as a technology development.

[Operator]

And the next question is from the line of Dhaval shah, an individual investor.

[Unknown Shareholder]

I just have a query, we had announced a JV with IOCL 6 months back. And then there is no further update about that JV what we are going to do about this. Similarly, [indiscernible] who had announced and detailed decision about Europe going for 2G ethanol plants. So then there is no further update how we are addressing that market.

[Shishir Joshipura, executive]

All right. Thank you. Sorry, that was miss out from our end. Thank you for pointing it out Dhaval ji. So on IOCL JV, the both the Boards have approved the JV. We have agreed on the language of the agreement. We have the structure of the JV. It's a process because this is now a public sector to a private sector partnership. So there's a process of approval [indiscernible], which is currently underway. Nothing that we can influence directly. It's a process that will take its natural course, and we expect that soon we will hear about an approval. Once that approval comes, we'll be able to develop.

There is [indiscernible] activities that we are doing in anticipation of that approval on the sideline, and you will hear about them as soon as this [indiscernible], but once the JV is formally announced in terms of approved by [indiscernible], we will be able to talk -- we are already working on the sidelines to development of a pipeline of products IOCL JV.

Coming to Europe 2G then, yes, you are right. There has been a bit of a slowdown in the activity in Europe that we witnessed, but now the activities have picked up and we are now beginning to see active dialogue that is taking place with a couple of interested parties who now want to go ahead and evaluate.

The critical dimension, of course, to this is the fact that we also had to commission the IOCL project at Panipat. This is what I mentioned that we'll be able to commission it in the first quarter of the next year -- next financial year. And as soon as we do that, I'm sure that we will able to showcase that it is possible to do this, and then we'll be able to move -- show some positive developments on the damage.

[Unknown Shareholder]

And one more thing, sir, we're not showing any top line growth this year. Can we expect some movements in top line growth going into FY '25, and we have some top line growth and numbers also aligning to our vision.

[Shishir Joshipura, executive]

So Dhaval ji, it's a very good observation. And as I was mentioning in the answer earlier, net because of this -- so there are 2 major shifts that happen on the domestic side. One was the policy on FCI rice allocation. Second was on the news of syrup for ethanol production. In both, what we have seen is that this has meant that customers had to reassess as well as the bankers have to reassess the project viability and look for alternative resources. So that has led to a delay.

So you will actually see an order book, which is -- that will carry forward into next year, which is a very healthy one. And that will indicate to you how the whole year will unfold, yes? Yes, there is a delay and this delay has meant that -- and the announcement came at such short notice that we did not have time to find an alternative because time period was too short. But you will be able to definitely see a healthier order book being carried forward.

[Unknown Shareholder]

We hope that everything align that for the vision because we can align to our vision is long.

[Shishir Joshipura, executive]

Thank you so much.

[Operator]

And the next question is from the line of Sagar Dhawan from Valuequest.

[Sagar Dhawan, analyst]

Sir, my question is on 1G ethanol. Just wanted to understand what kind of feedback are you getting from your sugar-based ethanol customers on the viability of their operations with sea, road and possibly dual feed as well. So with the kind of incentive increase that we are seeing right now from the government side, as you mentioned, [indiscernible] -- what is the level of viability that right now they are seeing?

[Shishir Joshipura, executive]

So Sagar, I think the question is that this is a question of product mix for the sugar company, right? How much sugar and therefore, how much ethanol is which is -- and that mix is something that how much is their export, how much is their domestic sales, what's the price of the sugar, what is the price of sugarcane, what's the cash flow situation [indiscernible], cash flow situation. So I think that's the balancing that they will have to do.

And that's what I was mentioning that we understand that this could be -- it's not a straight-line equation. It's a complex equation. And we want to help them solve some of these by actually offering the multi feedstock [indiscernible], if one feedstock does go in a different direction that does not allow you to produce ethanol for reasons of economics. Well, you can always offer another feedstock that will enable to produce because the demand for ethanol is not going away. That's a fact.

[indiscernible] B20 program is very much here. The economy is running. India is growing. So all those directions I think what has to happen is that we need to create flexibility at the input side, and that is what we are attempting to do. And we do see -- we clearly see the dialogues are starting, but I'm sure that over the next 4, 5, 6 months, we will see development of dialogue with the sugar, only sugary feedstock-based companies or ethanol production facilities will look for diversifying their feedstock base.

[Sagar Dhawan, analyst]

Okay. Got it. And sir, when you say diversifying would that mean that the dual feed plant will have sugar as well as maize as an input you have the capability to provide that kind of a plant?

[Shishir Joshipura, executive]

Yes, we can. Yes we can.

[Sagar Dhawan, analyst]

Sure. Sure. Okay. And can you tell us about the inquiry pipeline that right now that you're seeing on dual feed, maybe any quantum?

[Shishir Joshipura, executive]

Already inquiries have begun. Customers also, we also built a plant for a couple of our sugar customers, which what we called dual feed plants. They're already there up and running. So there is proof on ground. We had already anticipated this. We have been dialoguing that customers to diversify that feedstock. Some of the guys, the early leaders have taken what I would call is they're already in anticipation. Some will take now because now they see a different reality in front of that.

[Sagar Dhawan, analyst]

Got it. And sir, our last question on this front. What is your current order book, what is the mix of dual plant in 1G?

[Shishir Joshipura, executive]

We'll get back to you. I don't have that available ready on my hand.

[Sagar Dhawan, analyst]

Sure, sir. Sure, sir. Last question from my side, actually, from SAF. So you mentioned that you're working with some of the customers already in the U.S. on the engineering side, just to be ready for end...

[Operator]

Sagar Sir, can you please come in the loop for the follow-up question?

[Shishir Joshipura, executive]

Let's start a question. Yes.

[Sagar Dhawan, analyst]

Yes. Sir, just on the pipeline on SAF side, you're working with some customers on engineering side, you mentioned earlier also, you've given some numbers and you're working with some customers. Can you just tell us how many customers are you working with right now, how many plants are you already working with on the regional?

[Shishir Joshipura, executive]

We're working on 6 projects where this engineering is underway one way or other.

[Operator]

And the next question is from the line of Lokesh Maru from Nippon India Mutual Fund.

[Lokesh Maru, analyst]

Sir, just one question from my side. I wanted to understand what is the kind of 2 things here on when we see that we will be able to provide a multiple solution to our existing customers. So what is the kind of additional cost it might take to add this functionality to the existing plant?

And then what kind of loop do these customers have to go through if, for example, say, they need INR 25 crores extra for 100 kt, will they have to go back again to the bankers for -- to approve the loan? And I just want to understand the cost any addressable market for us, and your view on how much of that addressable market will be able to convert in the next 12 months? Because more than looking at it as a challenge, I see this more as an opportunity for us to actually cross-sell our solutions at this point.

[Shishir Joshipura, executive]

Yes. So I think you said it very correctly because we have always believed that when the challenge is present in the ecosystem, it actually creates an opportunity as well. We just need to do a different thinking. And that is how this whole multi-feature options came about.

We have been talking to some of our customers in tetra mentioned earlier answer as well that we have actually already built commercial scale plants, which are running with multiple feedstocks on ground. So that's not one.

Coming to your question then, what's the feedstock, what alternative feedstock, what capacity do they want the alternative feedstock to actually be built for because sometimes something 100% capacity to be built. So I have 110% and by somebody okay 50% for some time, that becomes the question.

So there are many of these questions that needs to get answered for me to give you saying that, yes, and depending on that and how much cash -- their cash allocation or capital allocation policy is they may or may not have to go to a banker or a financial institution for funding, they may well fund it internally.

The thing is that you are an existing producer, the demand for end products continues to remain the same. And now we're diversifying only to address the feedstock channel. So that depends on the location of the plant. There are many factors. We will not be able to give you an trading numbers.

[Lokesh Maru, analyst]

Sir. And sir, a similar opportunity like this to cross-sell deal food solution, does it exist in maybe other geographies like Brazil, U.S., Europe, even in Southeast Asia. Are there -- what is the kind of competition that could be this time?

[Shishir Joshipura, executive]

The multi feedstock in India, but we are also beginning to see this emerge in Brazil.

[Lokesh Maru, analyst]

Okay. And the kind of competition?

[Shishir Joshipura, executive]

Every market has a different competition. So Brazil is on corporate, but the structure of the market is different. India will have its own competition because the structural market is different here. So good. Competition is good. We are not problem with the competition. I think it's good to have competition. But that keep everybody the whole entire ecosystem very healthy and competitive. So that's good for everyone concerned.

Maybe we have more to talk about it a few -- a couple of quarters down the line when things start to crystallize. This is very new. This is just literally a month old month from the last old phenomena that has happened. And I think what is very important is for customers to see what the forward features looks like in near term as well as midterm and that will decide how we will move forward.

[Operator]

Ladies and gentlemen, due to time constraint, that was the last question. I now hand the conference over to management of Praj Industries Limited for closing comments.

[Shishir Joshipura, executive]

So thank you, everyone, for your time today. In case you have any more questions, please feel free to write us at [e-mail]. We will try to answer all your questions. Thanks again for your time today, and have a good day.

[Operator]

On behalf of Praj Industries Limited, that concludes this conference. Thank you for joining us, and you may now disconnect your lines.