Epigral Limited — Q1 FY27 earnings call

Ladies and gentlemen, good day and welcome to Epic Rail Limited's Q1 FY27 earnings conference call. As a reminder, all participant lines will be in the listen only mode and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during this conference call, please signal an operator by pressing star and zero on your touchstone phone. Please note that this conference is being recorded. I now hand the conference over to Arya Patel, MK Global Financial Services Limited. Thank you and over to you

Thank you, Abhirat. Good evening, everyone. Today, we are here for Epic Limited's Q1 FY27 earnings conference call. We would like to thank the management for giving us the opportunity to host the earnings call. On this call, we are joined with Epic's management, represented by Mr. Moulik Patel, Chairman and Managing Director, Mr. Kaushal Suparkar, Executive Director, Mr. Rakesh Agarwal, Chief Financial Officer, and Mr. Milind Koteja, Investor Related.

and strategy. I would now like to invite Mr. Moulik Patel to initiate the proceedings with his opening remarks, post which we'll have an interactive Q&A session. Thank you and over to you, sir.

Thank you, Ajay. Greetings everyone and welcome to the call to discuss ethical quarter one FY27 performance. I believe you had an opportunity to view the early presentation that was released earlier today. Quarter one FY27 presented a highly challenging operating environment across all the segments including chemicals.

The ongoing West Asia conflict directly impacted the cost structure for both raw materials and finished goods.

Furthermore, severe disruptions to shipping lines led to the transit delays and the logistical constraints.

The market volatility made business execution difficult. However, we are seeing a visible recovery compared to operation level and we expect the macroeconomic environment to stabilize and improve as we move forward.

Even against this volatile backdrop, Epic Growth demonstrated a resilience, devising a revenue growth of 15% and EBITDA margin of 25%.

This performance was driven by the increased sales volume and improved realization.

This growth was primarily on account of diversified product basket of the company.

Our diversified product portfolio provided a critical resilience in this challenging quarter. While certain segments faced headwinds, our alternative product line steps into the offset this impacts and the sustain our overall growth momentum.

We firmly believe that as we further diversify, it will enable us to deliver consistent growth over a longer period of time.

Our ongoing capacity expansion project for epichloroidine and the CPVC regime are progressing as per timeline and within budget.

With demand for both the products projected to maintain a double digit CAGR over the coming years.

Our enhanced infrastructure is perfectly positioned to capture India's expanding market and drive performance.

I am also pleased to announce that our board has approved a strategic CAPEX plan for two new projects.

We are entering into the epoxy resin and formulation with a capacity of 125,000 tons per annum and setting up a multipurpose plant.

Epoxy resin and formulations is a critical material used for high performance and quality driven applications. As India grows, the demand for high quality infrastructure development, automobiles, renewable energy, electronics is increasing rapidly and leading to the growth in the demand for epoxy resin.

This move is strategically significant for the company as a key raw material required for manufacturing epoxy resins, including each epichlorohydrin and the caustic soda are already produced within our integrated manufacturing complex.

More than 50% of the raw material value for the proposed projects will be sourced internally for the strengthening our integration advantages and operational efficiency.

In Tandem, the company is setting up a multipurpose plant to manufacture downstream products of the epichloroidine and the chlorotoluene varices. This facility is aimed at addressing the growing domestic demand for pharmaceutical and hydrochemical intermediates and water treatment chemicals in India.

In line with our phased development approach, we are also establishing a pilot plant facility for both epoxy resins and formulations and the MPP, multipurpose facility, which is expected to be operational by quarter two FY 2023.

This pilot facility will help validate product quality, optimize manufacturing processes, and facilitate early customer approvals ahead of full commercial scale operation.

This strategic expansion marks our forward integration into the advanced materials and the specialty chemical segment while further strengthening our integrated complex.

This investment reflects our ongoing commitment to building a highly integrated manufacturing platform and diversifying our portfolio to deliver long-term stakeholder value.

I now hand over the call to Mr. Rakesh Agarwal who will take us through the financials.

Thank you.

Year on year revenue increased by 50%, 15% to 709 crore compared to 615 crores in Q1 26 on an account in sales volume and also because of the increase in realization.

EBITDA in absolute term increased by 10% to rupees 179 crore compared to 163 crores in Q1 26. EBITDA margin stood at 25% versus 27% in Q1 26.

PAT grew by 25% to rupees 99 crore versus comparable adjusted PAT of rupees 79 crore in Q1 26. In fact, in the corresponding previous quarter, we have announced a profit of rupees 160 crore that includes 81 crore on account of the deferred tax adjustment. So after adjusting the PAT of rupees 79, we have completed.

ROC stood at 16% as on 30th June versus 24% as on 30th June '25 due to drop in earnings for trailing 12 months and also because of sizable capital working progress. If you remove capital working progress then ROC stand at 18% for Q1 '27. Net debt to EBIDTA stood at 0.8% as on 30th June versus 0.6 as on 30th June '25 on account of lower earning for trailing 12 months and also that increase. We we have spent rupees 65 percent on GST and GST and GST and GST and GST and GST and GST and

₹42 crores on CAPEX in Q1 '27 and that that stood at ₹474 crores versus ₹439 crores as on 30th June.

2022, with this we can now open the floor for questions.

Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question, may press star and one on the touch tone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we'll wait for a moment while the question queue assembles.

The first question is from the line of Nirav Chimodia.

Annual wealth, please go ahead.

Yes sir, good evening and thanks for the opportunity. Sir, few questions. So first on the epoxy side, let's say if you can help us explain that capacity announcement is predominantly for the LER or it also includes the value added products?

So this capacity which we have announced, this is including LVR and value added products in the formulations as well.

Okay, okay, but predominantly this 150,000 tons of capacity would, uh, in result can produce up to 150,000 tons of LER. Uh, that's the right assumption to make?

100 days.

125,000 tons which we have announced.

No, Elia will be a little bit lower size, but it is a mix of all products including Elia, this capacity it is.

Correct.

So our plan is very clear, you know, 50% of the epichlorohydrazine we would like to consume in-house and 50% we will sell additionally in the market.

Okay.

Correct, correct, correct. And when we convert after our execution,

After our expansion of new capex of epichloroides. This total capacity of the company will be eventually around 100 KPA, 1 lakh tons. So out of 50% we would like to consume in house in the epoxy resin and its derivatives and remaining 50% we will sell in the market.

Okay.

Perfect. And when we convert AGR into value-added products, predominantly the additional raw material required would be bisphenol, right? And not the ECH.

Right.

Perfect. Sir, just continuing here, like, where do you see the markets moving for the epoxy over next three, four years? And if you can also help us understand which of the user industries would be driving this growth. Also, if you can help us explain what's the current market size for epoxy resin divided between LAR and the value added products?

Yeah, so the epoxy market, you know, it will be majorly consumed in India, specifically in the windmill blades. It will go into automotive industry. It will go into construction industry. And then again, it has applications in various other downstream products which are yet to grow in India. And considering current situation, the demand for epoxy to our estimate is around somewhere around 250 to 300000 tons and which we expect to grow in a double digit percentage from here on. So considering that, the additional supply that will come in India, it will be around

Some from us, I guess we will easily absorb in the market, considering the way India is growing for all the quality kind of products and that's where the demand for this should go up.

Perfect. So what would be our focus?

You know, but you know.

point you know we are also expecting because in Europe all the chemical plants are difficult to survive. So we believe that eventually it is going to be exported from India. Once the FTA agreement is done. So we are at par with other Asian players and and being a very logistical point of view we are near to Europe. So we consider that Europe is also going to be a big market going future once the FTA agreement is done with India.

I was just coming to that point. So, what would be our competitive advantage here? So, because we have a backward integration in terms of ECH as well as the caustic soda. So the competitive advantage would be more based on the lowest cost production of LER or would it be based on the differentiated products which is generally required for the export market?

So it is going to be both as a background integrated as well as we will have a mixed portfolio. We will start with basic product and eventually we will go into the specialty. That's the priority as of now but yeah.

Correct and according to your best estimates like in terms of the value added products, how much is the approval time from the customers because there the customers are generally stickier in terms of the materials from where they are purchasing on. So considering that point, where where do you see the approval cycles from the customers specifically from the value added portfolio?

yeah that's a very good question you know you know you must have seen in my presentation I have mentioned about the pilot plant. So we are dedicatedly creating a pilot plant and we will take approval of the customers wherever it is required. But you know in epoxy resin market not all applications require a customer approval well in advance and it takes time. Certain applications it is taking time but not all applications. So definitely initially once we start a plant we will start with basic things.

And eventually we'll go into the specialty. But we are setting up a pilot plant just to make it efficient once we commission both plant epoxy as well as our existing multipurpose plant as a value added product of ECH epichlorotrine as well as chlorotoluene and all. So we can able to use once we commission it before that we are able to use and produce all the batches and the products and the customer trials and approvals is done while in place.

Based on our past experience, we do not want to delay that. So that's why we have invested in last 6 months in the pilot plan which is going to be commissioned by September this year. So we have enough time for the pilot facility to commission product to product application wise and by the time we commission our both the projects.

Okay, yeah.

VIP

Perfect, perfect. The second question is on the chlorotoluene. So, where are we currently in terms of the product placement in the market? I mean, are we selling the base products of ring chlorination where OCT, PCT, 3, 4 DCT are the products which forms there or are we also doing protochlorination and the cyanation products which have a slightly complex process and a better realization. So, where do you see this business moving over next one or two years in terms of going into the market?

to the complexity of process and hence the profitability part.

So yeah, it's a it's a good question Anirudh and and I think we learned from our past couple of years experience, you know, about the chlorotoluene because it took us lot of time to take approval because of we don't have the pilot facility for the trial batches which customers of pharmaceuticals and hydrochemicals which take their approval from their CDMO customers. And that we realized and I think this time before we plan

on our expansion, we would like to set up a final plan as I mentioned. And and that is the reason and definitely as you mentioned the OCT, PCT or any dichlorotoluene derivatives which we are planning the photo chlorination. We would like to go downstream as much as possible as the intermediate and based on our learning of last two years, we have identified couple of products which has a much higher potential than what we have set up a plant in the first phase. So definitely existing product portfolio.

A set of chlorotolants we are expanding along with epichlorohydrin derivatives which is used for the water treatment chemicals intermediate which are currently imported directly into the end application which also wanted to cover in our existing multipurpose plan.

Correct. So, the base products of chlorotolins are currently getting sold. It's like going into those complex processes and the products now based on this pilot plant, we would be moving ahead with those products sooner.

Yeah. And as you said, you know, our eventually our goal is to target probably next three years time our target is to reach once the multipurpose plan will be commission our target is to reach all the derivatives specialty product portfolio which we are producing in multipurpose plant along with the chloro toluene derivatives. We wanted to close close to around 500 crore revenue we would like to target. That's our first phase first milestone we would like to achieve it.

And this should be in FY29 or could be sooner than.

Yes, it could be in FY29 because in FY28 we are targeting to complete the MPP, so the ramp up will happen gradually, so maybe FY29 or FY30.

Perfect, perfect. Uh, sir, last big quick question. So what were our ECU realizations for first quarter and if you can also share for Q4 of FY26 would be very helpful.

So, Q1 FY27, the ECU was around 35, 36000.

Okay.

And for the fourth quarter,

Both quarter it was around 38000.

30.

Yes three zero

Okay, fine. And last, if I can just squeeze on, what were the capacity utilization for caustic soda, ECH, CMS, and CPVC business for Q1?

So caustic soda, it would be having around 75%. PCH was around again around 70-75%.

Okay.

ECH CPVC was around 50-55%.

Okay.

Fluoromethane was around 100%.

Okay, and peroxide.

around 85, 90%.

percent.

Perfect. Thank you so much and wish you all the best.

Thank you

Thank you. The next question is from the line of Rohit Sinha from Suniti Securities. Please go ahead.

Yeah, thank you for taking my question, sir. Some of my questions are already answered, just a couple from my side. One is, out of this 600 crore capex, could you give us the breakup for this, I mean, how the epoxy resin and MPPs project?

Uh, Rohit, it will be difficult to give the breakup as we, as in announcement, we have kept it combined.

Okay. Okay, fair enough. And just wanted to understand as we are adding our ECH capacity, I mean doubling our ECH capacity from 50 to 50000 to 100000. And here for epoxy resin as well as MPP would be requiring ECH. So just after these as you are saying a 50% would be consuming internally, would that be enough? I mean,

for all these 125 thousand epoxy and MPP I mean 50% would be available for sale or would there be further you can say consumption for?

in the NCB plant which is other than epoxy application the quantity requirement of epichloride is not that big. So definitely we will consume on our customers which we have catered so far we will continue going forward also. So definitely as I mentioned 50% of the epichloride will remain for the existing customers which we are catering right now.

Okay

Got it, got it. And sir, as epoxy resin would be adding margins for overall combined business, will it remain in that 24% kind of range which we were guiding earlier, or any changes in that?

Definitely Epoxy is you know, if you say compared to it's a high turnover in terms of volume gain compared to other products what we have in the market. So definitely Ebita margin will be much lesser because if you see the compared to the investment the ratio of turnover in the Epoxy region is almost four times. Which is almost three times higher than what we have we are having right now in our existing portfolio. So definitely Ebita

Amarjit, in terms of percentage, definitely it is coming lower, or in terms of the absolute value, I think it is, it is substantial value for the constant.

And just to add to that, we are, I mean, whenever we evaluate projects, our focus is ROC. So in that way, epoxy even with that kind of margins fits in the ROC bracket that we generally target for.

Okay, okay. And just last question on the capex of this 600 crore at peak level what kind of maximum revenue would be generating?

Mining Board Project

Combining Both Project

Combine both the closing and the peak can be in the range of 1000 to 1500 CR.

Got it. Sorry ma'am.

Sorry, my mistake, my mistake. 1300 to 1500 CR.

Okay, 1315. Fair enough. That's it from my side. Thank you and best of luck.

Thank you. The next question is from the line of Abhinav Mandopara from Equitas Investments. Please go ahead.

Yeah. Thanks for the opportunity. My first question was regarding the current chlorine realizations for Q1 and current. And you mentioned ECU realizations for caustics were in the range of 34, 35 to 36,000. What are the current realizations as of today? And since the war like situation has prolonged, do we see caustic inputs coming in and any supply side disruptions happening around that?

Hello

Sorry.

Can you repeat your question? Your volume was a bit low.

Yeah. And the audible now?

Yes Yes Yes

Yeah, my first question was regarding the chlorine realizations for Q1 and currently, and for ECU realizations for Q1 you mentioned 35000 range. What are the current ECU realizations and since the war has prolonged, do you see caustic being imported and any disruption happened over there?

The tourism realizations have been in the range of around 4000, negative 4000 and the ECU for the quarter one was around 35000 and we considering current when the things have cooled off a bit, the ECU currently also has been in the range of around 31, 32000.

Okay.

Okay.

And what are the current PVC prices?

Sorry?

So currently there was an MIP which came last yesterday and the PVC prices have increased. So it is around 85, 84. So does this create a negative impact because this will be a new floor and could you help us with the impact on the PVC?

So PVC is a raw material for the CPVC application and normally if you see the major difference was coming from globally it is coming from a carbide based PVC. A carbide based PVC which is made out of coal that is having a lower price than the ethylene based PVC. So I think because of the MIP major effect was on the carbide based PVC not on the ethylene based PVC so we use ethylene based PVC so I don't think so is there any major impact but I think it is

Support, you know, people who consume PVC which compare with our CPVC, they don't understand sometimes we cannot manufacture CPVC from the carbide based PVC. So that's why it is easier to convince our customers because of the MIC.

Okay

So we can pass on the entire incremental price, right?

Not immediately, but yeah, gradually. But it helps us to convince our customers in the CPVC industry that we cannot compare with any kind of PVC as a CPVC application is only for if we can manufacture good quality of CPVC only from the API in basic.

Got it. Also, in the caustic space, we've seen a lot of capacity addition across the last couple of years, across a lot of players, and majority of it was exported to a couple of places. Now, since there is a lot of supply chain problems, do you see that this domestic space, there is a lot of competition given that your capacity utilization has also decreased to 75?

Yeah, that is true. You are right what we have forecasted our CPVC growth which was not came compared to last year and this year. But normally we are expecting because now the CPVC pricing and the PVC pricing the difference is not big in a huge way. So majority of the applications which is used for the PVC also are converting into the CPVC application. Not only for the hot water pipe application. So the volumes we should see now the increase in the current financial year.

And going forward also. But yeah, you are right that, you know, as a CPVC growth because of the PVC fluctuation was so high in last six months. So there is an effect in terms of inventory purchasing from all the customers of Spice. So they are controlling their CPVC or the PVC inventory in a controlled way and that's why the consumption is also affected and the plant is also running little later.

the capacity. But we see normally the current quarter also because of the monsoon season, this is always the case in throughout the year. You know, if you see the sales will start from quarter 3 and quarter 4 is the major two quarters considered as a CPVC for the major growth in in the country.

Right. So my question was mainly for caustic. So caustic also we've seen a lot of capacity addition and of volumes, capacity utilization has reduced. So just wanted to understand because in the last couple of years a lot of capacity was built in costing which was getting up like ported, which because of current war like scenario supply chain is disrupted. So could you help me in the caustic space?

So caustic I believe you know because of the way the alumina expansion is happening in the country. So we believe we are going to be net import of caustic continuously in India irrespective of the capacity addition will happen gradually which people has announced in the past. So I don't think so India will be surplus definitely once the plant is complete.

commission and that plant is also going to commission in a gradual way. So as as our based on our past experience irrespective, you know, wherever the caustic expansion happens, definitely you will face a challenge for a couple of years, but eventually as the country is growing there in terms of the application, in terms of the consumption, in terms of the downstream application, in terms of daily use as well as in the alumina application. So we don't find that it is eventually that whatever capacity we are adding,

Eventually in the future it will be absorbed.

So definitely for the short term we face the issue but not in a long term.

Good.

Got it. And in terms of epoxy, there are a lot of players who have come up with capacity already like DCM, Sriram, Grasim, etcetera, etcetera. So do you think this will also be a domestic substitute or like ECS we would also be trying to export this?

No, this is definitely right now our long-term goal and approach is is to cater a customer in India only because you know India's market is growing continuously because majorly it is used in infrastructure based application and that is growing even in the renewable energy windmill is also growing. So our target long-term is that but you know if once we commission the project because you know certain size of the project

does not make sense to set up because when we set up a project, we keep always in the mark, in the mind that we are doing it for next 3 to 5 years period, you know, once we commission the project. So initially if we might need to export and and and the situation in Europe as I mentioned in the past that is is little tight and and there is a possibility and we are going to be at par with other Asian players also once the FTA agreement done in Europe.

So initially we might export like other products which we have done in epichlorodendron in the in the in the other product also. So same time, you know, initially we will export but eventually this is going to be cut off to the domestic Indian market only.

Got it. And what are the current ECH realizations?

Current DC realization is almost close to around, you know, ₹180 to ₹185, yeah.

So the prices have reduced. It was around 200 to 10, right, earlier?

Yeah, it is compared to all the products which was there during the war time which has gone to pick that has reduced and again now, you know, it has gone down to 175 levels and I think it is now going up again to 185 to 190 level. So it is going up and down based on the situation in the global scenario right now, ups and down based on the oil price and the logistic cost.

Okay.

And how much will be our power integration currently and what is our foresight going forward?

So we are very clear, you know, we are not going to invest further in the capital power plant. Whatever we are going further, the energy requirement is going to be catered from solar and wind hybrid agreement which we are doing with the different suppliers on a long-term basis. So we already have a 20 megawatt hybrid arrangement with one particular agency. Now we are doing, already we did another contract of 20 megawatt and going future as and when our energy requirement will increase, we will add more and more solar and wind in the future.

So, there is no great advantage to set up a captive power plant at this moment of time, where the government has given a great advantage by doing a long-term agreement with third party, and you can reduce your cost as good as your captive power plant.

Got it, got it. Thank you so much. I'll get back in tune for further questions.

Thank you. Thank you. Thank you. The next question is from the line of Harshit Singhania from Robo Capital. Please go ahead.

Hello, Hello Aridu.

Yes

Yeah, so congratulations on a great set of results. So, just to get a clearer understanding. So, from the 600 crore capex, we are adding like around 1300 to 1500 peak revenue at peak revenue. So, would that take a like total peak potential to like around say 4000 to 4500 crores? Is that a correct understanding? Seeing we are like close to 2500 crores and 2500 crores and we have like done.

quite good utilization.

No, see, when we are at, I mean, last year we ended with 2500 CR at that point of time, we have still capacities that are that can be ramped up. Plus, along with that, we have commissioned the capacities. So like chlorotoluene, caustic soda, CPVC, existing capacity can further contribute in FY27. Along with that, we have come, we are expected to commission our additional capacities of ECH and CPV3 in a couple of months. So that will further add. So,

If I put together that numbers of the epoxy resin and the MPP over a period of time, we should land up somewhere around 5000 CR once all the plants reach optimum level.

Okay. And so in the PPT you have mentioned that the addressable market is growing at 10 to 13%. So do we expect the company to like grow at a faster rate or at a similar rate?

See, we always aspire to grow at the range of 20%. That's the internal target or even higher than that. So definitely we would like to do that, but on if you ask me then on a like three, four years period, we can go in the range of 15 to 20% CAGR. So one year can be here and there because of XYZ reason, but the way India demand is growing and the plants that the capacities that we have, eventually plant will ramp up and we can have a CAGR growth of 15 to 20% for next five years.

And this is on the top line or in the bottom line?

We target for both top line and bottom line.

Okay. Great, I think that's it from my side. That's all.

Thank you. Thank you. The next question is from the line of Sakshi Trivedi from Sanko Mutual Funds. Please go ahead.

Hi everybody, how are you all?

So my question is regarding MPP projects, like we are known that we are going to announce epoxy and other things. So how is it, how is the MPP project different from epoxy and FR?

Sorry, your question is that how NDP is different from epoxy and?

Yes sir.

Like what is the end user use or what type of product we are going to do in MPP project?

In MPP, you know, we are targeting all chlorotoluene derivatives and the epichlorohydrin derivatives which is mostly in the water treatment chemicals which are used in the pharmaceutical intermediate and the agrochemical intermediate. And epoxy resin and the formulation is mainly going into the infrastructure based activity including renewable energy and automobile also and the coating application also. So this is two different end use application.

in the September base.

Okay. And second thing you have talked about like current EBITDA margins is around 25 to 26% and after commissioning of epoxy it will be reduced, then how much estimated margin we are expected from this 600 crore project?

See, it is difficult to give a number in terms of margin as, uh, I mean in terms of epoxy, it's of a lower margin but high assets or ROC will be intact. So what I can tell you is that going forward or we would always target to have an ROC around 20%, so we are targeting for that rather than giving guidance on margin, I can tell you that ROC we are targeting in the range of 20%.

Okay, Okay.

And like currently we have seen so much up down in ECH while doing selling prices or higher lease claim prices as well. So what is the like projection for future like are we expecting margins as per board approval or something different for lower margins?

actually when we whenever we consider a project we don't consider based on the current situation because this is abnormal situation. The current prices and the situation which is going on in the world which is not going to sustain for a long term point of view.

So always when we consider a project,

We always calculate based on the pre-war situation, what was the normal situation, and based on that, we conceive a project, and board is approving based on that data and numbers.

Okay, okay. Got it. That is from my side. Thank you.

Thank you.

Thank you. The next question is from the line of Manish Bhatane from 361 Capital. Please go ahead.

so thank you for the opportunity. so my question is on the EP Roy 10. So as the Indonesia is implementing the B50 biodiesel mandate and as the glycerin is the byproduct of the biodiesel. So given that glycerin is a byproduct, so how do you see this impact to the glycerin prices?

So your question is regarding

in the bodies or

my question is regarding the glycerin prices. As the acetoridrinum raw material is the glycerin and glycerin is a byproduct of the biodiesel. So if the they are moving from the Indonesia moving from the B40 to B50. So given that they are moving to the B50, so biodiesel will increase. So as the supply of the glycerin also increase. So want to understand like like how you are expecting the ACS prices will be.

to be very honest, you know, this is helping in terms of this is based on the bio diesel, this is based on the palm oil based majority of the product which is coming on the palm oil byproduct coming out from the bio diesel. So in the current situation where the rural price is not stable and because of that the propylene price is not stable. So propylene is a competition with glycerin. So definitely it helps in the current situation.

Uh, the way the crude oil price is fluctuating, the glycerin price has not fluctuated that much, but at the same time, logistics plays also a major role. So logistic cost has increased continuously in all the products globally because of the crude oil price in the current scenario. So that much effect has come on the glycerin, but there is nothing to do with the current situation and the glycerin price. You know, the bar is a policy and decision.

based on the glycerin decides which way it is moving and palm oil plantation of the palm oil and the how is the production is coming out in every year based on that glycerin is moving rather than moving in a moving along with the along with the propene or the crude oil base yeah. So this is completely different. There is no relation with the crude oil and the current situation.

I know, I know about the crude oil. So my what what I'm asking is that as the glycerin is a byproduct of the bio diesel and glycerin is also the raw material for the ECS, right? So if the glycerin if the bio diesel is is in the high production, so what will the supply will increase? If the supply will increase, then the price of the glycerin will correct and if the price price of the glycerin will correct, so the ECS prices will also get correct. So that is what I'm asking. Are you expecting ECS prices will

have a pressure on the realization front.

No, that is true to some extent, but it is not only these factors which affect the glycerin price, you know. Sometimes the the palm oil price also equally and and the people, you know, it is like when you are calculating your energy cost, you are you know, you need to take care of your byproduct also. So people are considering the pricing of both the product in a same way, you know, you can't neglect byproduct easily that that's why it is free of cost or something. So

Whenever palm oil is also, you know, it is also a very important factor in deciding the price of glycerin. Not only if you say, you know, it is a byproduct only, so you can neglect in terms of the cost, which is not the case.

But you are right in your question that this is a byproduct when there is a pressure, it is true, but normally now the glycerin demand is globally depends on the season. It is also increasing and sometimes it is down. So it depends on there are a lot of other factors also decide the price of glycerin, not only as a byproduct, you know, it is deciding factor.

Okay

Okay, we got it, got it. Thank you.

Thank you so much for the second question.

Thank you. The next question is from the line of Pratikosa from Systematics Group. Please go ahead.

Yeah, I said, uh, thanks for the opportunity. Just wanted to say that I felt, uh, what will be the status for FY28 as it's the FY27, like.

₹47400 crores for the first two years.

Okay.

Your voice is not clear, Pratik. We can't hear.

no so my question was the question was on CAPEX so for FY27 I guess the CAPEX is around four lakh crores what would be the CAPEX for FY28?

For 28 again, the CAPEX would be in the range of 400 CR.

So 27 and 28, 400 crores.

Yes.

And tax rate would be around 25%.

Yes, that's right.

Got it. Yeah, thank you.

Thank you. Thank you. The next question is from the line of Poojan Shah from Molecule Ventures. Please go ahead.

Hello Hello

Hello

Mr. Poojan, may we request you to use a microphone to ask a question?

Sure.

Hello

Yes, Pooja.

Yes.

Yes, okay, okay. Yeah, so first question would be on the the capex side. So we are spending around 600 crores. So how much will be for the internal and how much will be we'll take the debt?

So around 60%, 40% would be from the internal forces and around 60% would be from the debt.

Okay, got it, sir. And just to understand the current scenario of the PVC side, we have seen quite a volatility in PVC. So just to understand, one first is how we are able to procure the raw material because ethylene based, so we have seen the major majority of the facility of EDC are based out of MiraEIC and that has been impacted and that's where the price has been spiked. And so just want to understand how is the RM facility being provided in the PVC side.

different situation currently and are we able to procure the availability or we are facing some issues on the procurement of PVC that is impacting the ultimate impact on CPUs.

Yeah, so what you said is true, things were a bit volatile in the full quarter and especially in April and May, but things had been stabilized then once the it was kind of a peace talk. But again, because of the situation which is happening in the market, the situation is again the prices are going up, but again current prices are going up because of the MIP. So I guess overall because of this, this there should be a stability in the price and I guess if I look at from a long-term perspective, this will kind of

kind of bring a stability and it will be good for overall market put together. So we are positive on this rather than thinking on the other way around.

Right. And so just to understand on the current realization of CPCs or what is the current realization is pertaining right now. And what is the hike we are expecting after increase in the PVC price due to MIP.

that thing has been already factored and currently the CPVC prices would be in the range of 115, 110. So again now the again how much the price will go up because I the impact might come because of the issue in the West Asia, West Asia where it's crude is impacting. But again time will tell. It's too early to comment how things will pan out in the coming next two months.

So I'm asking just just just to answer your question, you know, the ethylene based PVC price was already on the higher side when the MIT was declared. So I don't think so any major impact will come on the CCTV price.

Hey man.

Because it's a

Because it's a little earlier.

In the earlier, you know, this will affect only the coal-based PVC which people are using for the PVC application.

Got it, sir, got it. Because why I'm asking the similar question is because the PVC in the previous cycle when the oil was spiked, the prices were inch up to 105 or 110, I think that was the price range which was been inch up in the PVC. And there was a sudden fall to 275. So, in that meanwhile, we might have hold some inventory which might be beneficial, but ultimately right now the prices has been spiking up and spiking down.

This is not. So that might be shrinking our EBITDA margin for a, uh, for a short term period. So that's why my question was in a similar range.

It's too, uh, I mean, difficult to look at numbers on a quarter to quarter basis or even month to month basis. If you put together in this side or that side, things get stabilizing, we'll end up at the reasonable kind of company level margin.

Yeah, and and last question would be on the CPC because also demand is pretty weak right now and we were expecting in Q2 that the demand might be revived but but versus what has been happening is the industry is facing additional capacity from Grasim obviously they have started and obviously we we'll start our own facility as well of 75000. So how do you think the situation will pan out for FY27 in the future?

CPU PCI.

in India when the companies are expanding definitely there is a glut for some point of time but this this customer of approval and and enhancement of the plant is also it is taking some time it is not that easy. So to ramp up and to reach that optimization it will take time always whenever people are expanding their capacity and same time as I mentioned in India it is continuously growing so eventually this capacity will be absorbing in India.

And based on that, people are expanding the capacity of the CCVC. Yes, but you are right that in for some point of time there is overlapping and and and the over over over capacity will be there. But in the long term, we are very positive in terms of the growth of the the infrastructure which is happening in India.

Got it, sir. Thank you so much and all the best for the current year. Thank you so much.

Thank you. The next question is from the line of Abhinav Mandovra from Equitas Investments. Please go ahead.

Mr. Mandobra, your line has been unmuted. Please go ahead with your question.

Yeah, my question was regarding demand supply and pricing scenario for hydrogen peroxide and chloromethane, and second follow up was why has the caustic current utilization.

have been reduced from previous quarters.

Hello

No, no, this is normally we are running at full capacity only because of some technical issues, we might reduce the capacity in terms of hydrogen peroxide or the chloromethane plant. But yeah, major variation in terms of the gas price and the methanol price, it is happening right now because of the war situation, methanol price is very fluctuating and and the hydrogen peroxide is we are generating as a co-product along with the chloro alkali, but most of the other computers they are producing from the natural gas. So because of

that there is an uptake in terms of the hydrogen peroxide currently because of it is directly related to as a competition, it is directly related to the gas consumption.

Okay. Yeah, that's it.

That's a major issue in terms of the consumption and equipment of time.

Okay.

Thank you. The next question is from the line of Rohit Nagaraj from 361 Capital. Please go ahead.

Yeah, thanks for the opportunity and congrats on sequentially good performance. Just one question on the chlorotolians front. What is the total CAPEX that is envisaged on the project? We did some CAPEX for the base chlorotolians and now we are expecting the forward integration into value added products. So what is the total CAPEX and what could be the overall ROC requirement just to understand that there would be possibility that some of the base chlorotolians would be

be used for, I mean, captively consumed for forward integration. So, overall basis, what is the total CAPEX and what is the ROC that we are expecting?

So, in terms of CAPEX that in Torotolium, we have done a CAPEX in around 250 CR.

And again once the plant reaches at optimum level the revenue would be in the range of 300 to 350 CR. And again once the multipurpose plant commission and that starts ramping up that all put together we should land up in the range of 700 to 800 CR kind of top line.

Okay, so this is the consolidated top line including the previous project and the new NTP case six.

Yes Yes Yes

And here too, our expectation is a 20 to 25% margins and probably a gestation period of 3 to 4 years to reach the peak utilization.

Yeah, so the estimated margin would be in the range of 20 to 23% kind of things. And again, once we commission the plant, it will take time to ramp up, maybe one and a half or two years time to reach the optimum level creation levels.

Perfect. Uh, that's all from my side. Thank you and all the best.

Thank you

Thank you. Ladies and gentlemen, we will take that as the last question of the day and I now hand the conference over to the management for closing comments.

Good evening everyone. In conclusion, I'd like to convey that we are moving in line with our strategy through our expansion plans and diversification in terms of multi-product catering various industries. We are targeting consistent growth. I would like to thank you all for joining us here today. Please feel free to reach our IR if there are still any unanswered questions. Thank you everyone for your participation.

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