EFC (I) (NSE:EFCIL) Q1 2027 Earnings Call

0:00 Ladies and gentlemen, good day, and welcome to EFC India Limited Q1 FY 'twenty seven 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. Please note that this conference is being recorded. I now hand the conference over to Ms. From MUFG InTime. Thank you, and over to you, ma'am. Good morning, everyone. Welcome to the Q1 FY 'twenty seven earnings conference call of EFC Limited.

0:48 To discuss this quarter's performance, we have from the management, Mr. Umesh Sahai, Chairman and Managing Director Mr. Nikhil Bhuta, Full Time Director Mr. Uday Wara, Chief Financial Officer and Mr. Aman Gupta, Company Secretary. Before we proceed with this call, I would like to mention that some of the statements made in today's call may be forward looking in nature and may involve risks and uncertainties. For more details, kindly refer to the investor presentation and other filings that can be found on the company's website and stock exchanges. With that, I would like to hand over the call to Mr. Umesh Sahai for his opening remarks. Thank you, and over to you, sir. Thank you. Thank you, ma'am. Good morning, ladies and gentlemen. Thank you for joining us for the Q1 Financial Year twenty seven Earnings Conference Call of EFC Limited.

1:39 We are pleased to begin the financial year twenty seven on a strong note. Q1 reflect continued momentum across our platform, supported by disciplined execution, enterprise led demand and the growing relevance of our integrated real estate as a service model. During the quarter, our consolidation revenue from operations stood at approximately 23 crores, representing a growth of around 29% year on year. Profit after tax stood at approximately INR 71 crore, growing by around 52% year on year. These numbers demonstrate the strength of our platform, the benefit of the scale and our continued focus on profitable execution. Over the last few years, we have continuously built EFC as a multiengine workspace platform across three core verticals: leasing, design and build and furniture manufacturing.

2:35 These businesses are distanced, but together, they allow us to participate across the complete commercial workspace life cycle. From a space identification and leasing to design execution, fit out furniture and ongoing workspace operation. Our leasing business continue to remain the foundation of the platform. It provides recurring revenue base, deep enterprise relationship and long term customer engagement. We operate across 25 cities during the quarter and serve more than seven eighty clients. Our design and build vertical continue to strengthen the ecosystem by allowing us to deliver turnkey commercial interior enterprise. GCC institutional client and multi location mandate.

3:23 The vertical enhance our relevance to client because we are not merely providing space, we are helping them create functional, scalable and ready to use workspace infrastructure. Our furniture manufacturing business further strengthen our integrated model. It supports quality control, faster execution, better procurement discipline and supply chain reliability. As this vertical sales is add another important capability to our platform and improve our ability to serve both internal workspace requirement and external institution demand. The industry has remained encouraging. India continue to see a strong demand for grade A commercial workspace, managed office solution and enterprise ready infrastructure. The shift towards GCC flexible workspace, enterprise led office and integrated workspace solution is closely aligned with EFC operating models.

4:17 What is important is that occupier today are not looking for the office space, they are looking for speed, flexibility, design quality, execution, certainly and a single accountable partner. This is where EFC integrated leasing design and build and furniture capability create a meaningful and competitive advantage. We remain focused on disciplined growth, improving asset productivity, strengthening enterprise relationship and create sustainable value for all stakeholders. Our approach is not just to expand, but to expand with operating discipline, customer quality and return focus. I would like to thank our shareholder customers, banking partners, our team member and all shareholders' continued trust and support.

5:03 With that, I would now like to invite Mr. Nikhil Bhuta, Hold Time Director, to discuss the operational performance and the company in greater detail. Thank you. Thank you so much, Omishal. Good morning to all investors, analysts and stakeholders, and a warm welcome to the Q1 FY 'twenty seven earnings conference call of EFCILimited. Q1 FY 'twenty seven has been a strong operational quarter for the company. The performance reflects the progress we've made in the building a scalable, integrated and enterprise focused workspace platform. Our three core businesses, leasing, design and build and furniture manufacturing, continue to perform in a coordinated manner. Together these businesses allow EFC to offer a complete work solutions to clients while creating operating synergies, cross selling opportunities and deeper customer relationships.

5:58 Starting with the leasing business, this vertical continues to be the cornerstone of our platform. During the quarter, leasing revenues stood at approximately INR154 crore, growing around 26% year on year. Segment results from the leasing business stood at approximately crore of profitability that reflects the stability of the annuity model, the strength of our enterprise relationships and the benefits of scalable across our managed workspace portfolio. Our Managed Workspace platform now spans 25 cities with total seat capacity of more than 84,000 seats, build seats of more than 68,000 seats. We have also additional inventory in capacities under development, which supports future revenue visibility without making any revenue commitment.

6:49 The scale of these platforms gives us operating leverage, deeper customer access and stronger enterprise engagement. Enterprise demand continues to remain healthy. We are seeing traction from GCCs, multinational companies, BFSI institutions, technology companies, consulting firms, enterprise outsourcing businesses and other institutional clients. This client increasingly prefer flexible, scalable, high quality and professionally managed workspaces. Our ability to provide consistent delivery across multiple cities is becoming an important differentiator. A key sense of our leasing portfolio is the quality of customer relationships. Enterprise clients contribute meaningfully to our revenues and the average enterprise client tenure remains very healthy.

7:38 This supports revenue stability and help us build long term visibility in the business. Moving to the design and build vertical, the business continued to contribute strongly during the quarter. The revenue from this segment stood at approximately INR100 crore growing year on year. Segment results stood at approximately INR34 crore of profitability. The business continues to benefit from turnkey mandates, repeat relationships, multiple locational projects and demand from enterprise clients. Our current design win order book stood at approximately more than INR228 crore. This gives us healthy executional visibility. The strength of this business comes from our ability to combine design, project management, execution, construction related activity and MOP capabilities for the disciplined deliveries.

8:33 We continue to see opportunities across commercial space development, CCC facilities, institutional assignments, retail and enterprise infrastructure. The design and build vertical also plays a strategic role within the group. It supports our leasing business by accelerating fit out completion and helping us monetize spaces faster. It also opens opportunity with the clients who may not initially come to us for leasing but require turnkey workspace execution. Coming to the Furniture Manufacturing business, Ag Design continues to scale as an important part of the integrated platform. During the quarter, Furniture revenue stood at approximately INR 29 crore, growing more than 120% year on year.

9:18 This vertical strengthened EFC's backward integration strategy. It improves our control over quality, delivery time line and truck availability. The business currently has more than 2,200 SKUs and has delivered more than 75,000 units across categories. The order book for the furniture business is approximately INR 53 crore plus, which reflects growing institutional acceptance of the platform. The furniture business is still in a scale up phase. As volume increases, the focus remain on improving capacity utilization, product mix, executional efficiency and institutional customer relationships. We are building this business for long term strategic value, not just as a stand alone manufacturing vertical, but as an important enabler of the broader EFC ecosystem.

10:07 One of the biggest advantages of our model is that we participate across multiple stages of work workplace value chain. A client may engage with us for managed offices or design and build or furniture or a combination of all of these solutions. This increases wallet share, improves client stickiness and strengthen our position as a single accountable partner. Overall, Q1 FY 'twenty seven has demonstrated that our platform is scaling well. The leasing business remains stable and recurring. The design and build business has a healthy order book and the furniture business is gaining operating scale. The business pipeline across our verticals remains encouraging and the market opportunity continues to support integrated workplace solution providers like EFC.

10:55 We remain focused on execution, quality, discipline expansion, customer retention, asset productivity and sustainable value creation. I would like to thank all our investors, stakeholders for their continued trust and support in EFCILimited. With that, I would like now like to hand over the call to Mr. Uday Vora, our Chief Financial Officer, who will take you through the financial performance of the company. Thank you so much, and over to you then. Thank you, Nikhil, sir. Good morning, everyone, and welcome to the quarter one FY 'twenty seven earnings conference call of EFC India Limited. I will now take you through the consolidated financial performance of the company for the quarter ended 06/30/2026.

11:44 We have started FY 'twenty seven on a strong note with a healthy growth in revenue and profitability on a year on year basis. The performance during the quarter was supported by continued demand across our core verticals, disciplined execution and the operating benefits of our integrated platform. Revenue from operations for quarter one FY 'twenty seven stood at 282.88 crores as compared to INR 219.62 crore in Q1 FY 'twenty six, representing a year on year growth of approximately 29. EBITDA for the quarter stood at approximately INR 122.96 crore as compared to INR 102.16 crore in Q1 FY 'twenty six, representing growth of around 20% year on year.

12:33 EBITDA margin for the quarter stood at approximately 43.5%. Profit before tax stood at INR 101.34 crore as compared to INR 66.06 crore in Q1 FY 'twenty six, reflecting a growth of approximately 53% year on year. While profit after tax stood at INR 70.85 crore as compared to INR 46.67 crores in Q1 FY 'twenty six, representing growth of approximately 52% year on year. Profit after tax margin improved approximately 25.1% in Q1 FY 'twenty seven as compared to approximately 21.3% in Q1 FY 'twenty six. This reflects operating discipline, scale benefits and strength of the business mix.

13:21 From a segment perspective, the leasing business remained the largest contributor to revenue. Leasing revenue stood at INR 153.91 crore during Q1 FY 'twenty seven as compared to INR122.18 crore in Q1 FY 'twenty six, growing approximately 26% year on year. Segment result from leasing stood at INR64.33 crore. The design and build business reported a revenue of INR 109.39 crore during the quarter as compared to INR 84.69 crore in Q1 FY 'twenty six. The segment results stood at INR 33.84 crore. The business continues to be supported by execution of turnkey and enterprise led projects. The furniture business reported revenue of INR 28.57 crores during Q1 FY 'twenty seven as compared to INR 12.75 crores in Q1 FY 'twenty six, reflecting strong year on year growth of approximately 124%.

14:19 Segment results stood at 2.10 crore. This vertical continues to scale and remain strategically important to our backward integration and execution control model. Other income for the quarter stood at INR 11.42 crore. Finance costs for the quarter stood at INR 10.35 crore, lower than the previous quarter and broadly controlled related to the scale of the business. Depreciation and amortization stood at INR22.69 crore. On the balance sheet side, the company continues to support growth across leasing, design and build and furniture while maintaining focus on financial discipline. Our operating model involves both recurring revenue assets and execution led businesses, and we continue to evaluate capital allocation with a focus on return, asset productivity and long term value creation.

15:14 While the overall financial performance for Q1 FY 'twenty seven has been strong, we remain focused on improving operating efficiency, working capital discipline, client collections, execution cycles and asset utilization across the platform. To summarize, Q1 FY 'twenty seven reflects a strong start to the year. Revenue grew 29% year on year, EBITDA grew 20% year on year and PAT grew 52% year on year. The leasing platform continues to provide stable recurring base, the design and build businesses has healthy execution visibility and the furniture business is scaling as an important strategic vertical within the ecosystem. We believe the company is well positioned to benefit from the continuing shift towards enterprise managed workspaces, turnkey execution, integrated workspace solution and institutional demand.

16:06 We will continue to focus on disciplined growth, efficient execution, stronger customer relationship and sustainable value creation. With this, I conclude my remarks. I would like to thank all our shareholders, lenders, partners and stakeholders for their continued trust and support. I now request the moderator to open the floor for the question and answer session. Thank you. Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and 1 on their touch tone telephone. If you wish to remove yourself from the question queue, you may press star and 2. Participants are requested to use handset while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles.

16:56 The first question is from the line of Akash from Fedge Limited. Please proceed. Oves, sir, Nikhil, sir, Odessa, many, many congratulations on excellent results this time again. I have two questions. I'll break it down in two parts. Firstly, the DNB order book is at INR $2.28 crores and Furniture order book is at INR 53 crores. How much of this is going to be for third party and how much of this is going to be for internal capacity? So thank you so much, Akash. And yes, we have delivered a strong performance this quarter as well, and we are very confident going forward. With regards to the design and build order book and the furniture order book that you've mentioned or what is mentioned by us in the presentation, it largely contributes towards the outside business only.

17:52 So more than 85% is from the outside business because the majority of the development on the internal work has already been taken care of and largely it is done by the landlords only. So hence, this entire order book that we are talking about is largely more than about 85% is from the external business relationships only, Akash. So my second question is, sir, the interior D and D division revenue has declined from the previous quarter. It was, I think, earlier about INR120 odd crores, which has come down to about INR100 crores now. Is this going to be is this a business which is seasonal?

18:37 Or are we expecting some order delays? Or what is it? Yes. Mean, there's a little slight reduction compared to the last quarter, which is Q4. Typically, you would appreciate that our business under design and build is a project based business. There's no seasonality, which is kind of affecting this business. But what really matters in this kind of division or vertical is basically the projects that are under execution. Now typically, start getting your projects in the third and the fourth quarter of financial years and they get into the executions and obviously you see a great amount of upside during these two quarters, which is quarter three, quarter four. And you would have probably observed in our financials in the last financial year as well.

19:27 But so hence, the best way to probably look at it, this is if you look at it Q on Q Y o Y, then obviously there is a significant growth Q on Q Y o Y and it is and it will continue similarly Q on Q every Y o Y, every quarter on Y o Y basis. And we are very confident that keeping in mind the order book that we already have, which is about more than INR $2.28 crore and our executional capability that the timeline within which we execute, we are very confident of we are absolutely on track of achieving the growth target that we have of more than around 50% under the D and B segment on a Y o Y basis. So absolutely, there is no seasonality involved. Yes, obviously, the market conditions overall, there has been, as you know, that overall disruptions in the supply chain, overall disruptions in the material pricing, etcetera, etcetera. But despite all that, we have kind of continued growing on a Y o Y basis, and we believe that we will continue growing this vertical at the kind of targeted growth rate that we have set for ourselves for current financial Thank you so much. This answers my query.

20:40 Thank you. Thank you. Thank you. The next question is from the line of Bharat from Comtech Capital. Please proceed. Yeah. Thank you, EFC team, and congratulation for this wonderful result. So, sir, I have two questions. First question, I'll just like to put. I understand your model in... I know considers leased centers on the certain asset monetizations. So how do you look this product mix over next three years and how investors should value these three models differently? Absolutely. Thank you so much, Bharat. I mean, I think it is a very interesting interesting question question and and it it is is very very necessity for all of our investors to understand that how we are really contributing in creating better returns and overall capital efficiency through this model.

21:35 What we so there is number one, what we're doing is that we are not getting our leasing business affected anyway. What we're doing through the asset monetization model is we are basically acquiring certain good assets to this is we are doing a value acquisitions where the assets which are probably let's say ten year old, which are vacant, we acquire them, we refurbish them, we create value in them And then we lease it out through our own managed office vertical, which is anyway that's our kind of legacy business, right, and we understand this thoroughly. So what we are able to do is we are able to monetize such assets, create value in those assets and create greater amount of IRR revenue through this additional kind of revenue stream in the sense, if I may say so, where my leasing business for my leasing business, I myself is the landlord, which otherwise, what would I do? I would have got into a leasehold contract with the landlord, take the property on lease, and then I would have operated as a managed office. Here, what I'm doing is I'm acquiring an asset, and I am developing them and offering them for a managed office solution and also getting appreciation in the property value because of the great improvements and because of the making it asset, the yield generating, the rental yield generating asset and hence create that appreciation.

23:01 So this is a fabulous opportunity that our management has offered to the investors where investors apart from the leasing revenue that apart from the leasing profitability and the integrated business model profitably that we generate, we are also able to capture this asset monetization opportunity and which kind of improves our overall profitability, our overall margins, our overall offering to the investors at large. So I hope I've answered this broadly, but I mean we don't differentiate as an asset class here. Like I said, this is just we are kind of in a sense some of the assets that we are acquiring on our own book to create this appreciation opportunities. Understood. This is helpful sir. Sir, my another question is I understand we take eighteen to twenty months for payback for per seat without cost, is 50 ks.

23:57 Could you please give some idea whether it's a 50 ks standard cost or it's for some selected centers or it is from selected category? Or what is the worst payback period if the cost changes per seats profit outs? No, I mean it is fairly standard. I mean and we have been doing this business for quite some time now. So obviously it's fairly established for us. And as you also know that the fit out cost is in our case is usually funded by the landlord. So I mean it is we rather say that this is a payback for landlord in that kind of a period. So absolutely, I mean there not specific to any centers or anything like that. This is a kind of a standard payback period that one can achieve for the fit out that is done for our businesses.

24:49 And we also can achieve for fit outs where we do for our own properties. Within this period only, we are able to kind of achieve the payback. And this remain fairly constant standard across the centers, across cities, across Pan India, Understood. I think this is helpful, sir. Thank you so much. And again, once again, congratulations for wonderful results. Thank you. Thank you so much. Thank you. The next question is from the line of Mohan Sharma from Binayat Capital. Congratulations team EFC. Your furniture revenue has increased 36% quarter on quarter, but your segment profit fell around from 75% to around what 7% margin dropped 40% to 7%.

25:46 What was wrong in the Furniture segment? There's nothing wrong in the Furniture segment. And in fact, you see what how we look at it, the segment right now is this segment is growing continuously. It is kind of stabilizing itself continuously. And if you see year on year and quarter on quarter, it is improving in terms of the top line and hence it is improving its capacity utilization. And you would appreciate that the moment we kind of come to an optimal capacity level, we will be able to kind of demonstrate the margins which are more stabilized, margins which are more measurable. And I think that is the only situation that we are obviously witnessing in this Q on Q results that, yes, if you compare it with some of the earlier quarters where if the volumes are low, where maybe the services were for a specific type of projects, the margins were different and these are services are for very different type of projects, the margins could be different. But when we operate at an optimal level and which is what we are progressing towards, I think by end of this year, we should be kind of progressing to an optimal capacity utilization.

26:57 And at that time, we would be able to kind of come to position to compare our margins more appropriately. So at this point of time, comparing margins at a quarter on quarter level would not be appropriate because, like I said, it is still a not a full optimized capacity level and we are in progress to achieve it sooner within this financial year. And I hope this answers your questions. Yes. Thank you so much, sir. But I have a follow-up question. So is the financial segment a structurally low margin or was quarter four of twenty six margins were unusually high? Which quarter reflects the real run rate? Like I said, will be able to kind of give you the real run rate once we are at an optimized level, which is like I said, more than 60%, 70 capacity utilization.

27:52 So the real run rate would only be established once we are at that level and that is the time where we will be able to establish the correct profitability standards. And as we've always mentioned that this business is one of those business which is in value accretive business for us and where our margins are going to be really well because we have a lot of visibility on the businesses, lot of different kind of business model strategies that we have adopted starting from doing OEM business, doing exports business, doing institutional business, doing customized providing customized solutions. All of this is kind of helping us to kind of expand our margin beautifully well. We expect achieving an EBITDA of more than 25% easily under this vertical and that is a stabilized margin that one can really look at and this is what we are looking at achieving once we are at an optimized capacity utilization level, sir.

28:48 Thank you so much. Thank you so much for the clarification. Welcome, please. Thank you. The next question is from the line of Svenil Dhambat from Choice Institutional Equities. Please proceed. Yes. Hello. So first of all, congratulation on a good set of number to the to teams EFC. So I have a couple of questions. So what was the average occupancy rate and retention rate for the quarter? Hi, Fennel. Yes, the average occupancy rate has been 90% plus, as you can see probably in our presentation also, the operational billing capacities and the inventory that is roughly around 90% occupancy that has been worked out if you look at the numbers that is presented in the presentation also.

29:45 Okay. And the retention rate was it? So basically, yes, retention rate is roughly around 95% plus. I mean, we just have a churn of about 4% to 5%. So I mean, as you know that and that is also mentioned in the presentation that our average tenure for our enterprise client has increased to fifty one months, which is even better than what we have achieved for our earlier quarters. So I mean that itself shows that there is a great amount of retention. And hence, there is a very, very insignificant portion of churn that is happening at our organization level on the leasing vertical. So we are very strongly positioned in terms of our stability of revenue stream under the leasing business.

30:38 Okay. On this deal we've spend, have mentioned thousand $280,000,000 of current order book. So can we have a handy the last quarter's order book or by end of last quarter, by end of FY 'twenty six, what was this number? So that will give the sense like it's increased or decreased or what? So can you have that number with you? Yes, yes. Can, finally, you can obviously, you can refer to our Q4 presentation where we have already mentioned that our order book at the end of the quarter four was at INR135 crore worth of orders on hand, out of which as we have mentioned that already executed 100 crore plus of order, which are in balance are under execution.

31:28 And this quarter, we have order book of more than INR $2.28 crore, which is also already under execution. So that's on the order book, Finnell. Okay. Okay. Great. Great. And the next question on the guidance side. So what we can expect from the D and B and Furniture segment like the average or any CAGR growth or margin from this segment? And for leasing segment, the seat addition of 18,000 to 20,000, so we are confident on that. 1% confident kind of adding about 80,000 to 20,000 billable seats on the leasing business.

32:15 100% certain about the kind of growth that is happening under the design and build segment, which is like I said, roughly around 50% Y o Y. And we are also equally confident of achieving similar kind of growth for our furniture vertical also, which will bring us to a very optimal capacity utilization level. So we are absolutely confident on achieving the targets that we have set for ourselves for this financial year in terms of the growth targets. In terms of the margins, margin remains stabilized because one of our organization motto is very clear that independent of the growth that we're trying to achieve, we have to ensure that our margin remains stable and rather improves going forward with more capacity utilization, with more economy of scales being achieved through the integrated business model that we are working on and with more monetization models or strategies being added to the overall business plan. So absolutely, we are on target on those lines, Fenil.

33:18 Okay. Okay. Got it. And last question for you, sir. Like could you share some more color on the that demerger of EFC and EFC India, like when we can expect these and the impact of this demerger on our financials as well as overall business. So that will give more sense. Yes, Pindul. So this is more of a restructuring, more and more of a consolidation process where we are trying to kind of consolidate our corporate holding structure rather than doing anything on the financial restructuring. So this is more from that point of view and that is going to help ease understand the overall corporate structure much better. Now at the end of this entire process being executed, what you will see is a company which is a consolidated company at EFCI level where you have your design and build vertical and the leasing vertical.

34:17 What will be left out under a separate subsidiary, wholly owned obviously subsidiary is an asset holding companies because what happens is when we are acquiring assets on our book and when we try to monetize it is from a tax efficiency point of view, we try to keep them separately so that whenever we monetize them, there is a good tax efficiency that we can achieve. But doing this demerger, the objective is that we are consolidated all our different verticals, different subsidiaries into one and everything gets consolidated at the EFCI level and hence simplifying the corporate holding structure. Sometimes people feel it kind of that there are multiple subsidiaries etcetera. So that entire situation is kind of getting sorted out. Now it is simplified by doing this restructuring.

35:06 We are able to kind of consolidate everything under EFC Limited. There will be only EFCILimited, there will be asset holding company and there will be furniture manufacturing because that is our partnership company with our technical partners. So otherwise, everything will be consolidated under EFCILimited, which is already there. But I'm saying the structurally also all these wholly owned subsidiaries are getting aligned at EFCILimited. Okay, okay. So sir, whatever renew or whatever income we'll get from this normalizing the asset that will going to have an impact on like the overall financial, right? So where we are going to show that in which category or which line item or particular line item or like how we can going to consolidate that particular amount which we are going to get from the normalizing the asset?

36:06 So I didn't understand what you're saying about normalizing the assets. But basically, what I'm trying to say is that through this restructuring, we are doing all our leasing business, the diamond mill vertical under EFCILimited. And then there will be furniture manufacturing business and then there is asset holding company where our SPVs, which will hold the assets that we will monetize over a period of time. So it will be EFCILimited and then there'll be EFCILimited, which is already there as a wholly owned subsidiary, we'll getting kind of merged into the EFCILimited. Hence, there'll be only two company below EFCILimited, one, the asset holding companies and the second Egg Design Industries Limited. So the income will get consolidated at EFCILimited, number one, on a standalone basis and that will obviously offer a tax efficiency and also offer a simplified corporate structure.

37:01 So and all income streams would be recorded accordingly, whether it is, let's say, revenue from leasing, design and build or furniture on a segment basis. And also if there is an asset monetization happening, that asset monetization, if there is a capital gain, then capital gain would be reported accordingly. Or if there is revenue from leasing activity, it will get clubbed under the leasing business. So that's how things will get reported or organized through this restructuring that we are doing. Okay. Got it. Got it. That's all from my side. Thank you so much and all the best. Thank you. Thank you. The next question is from the line of Ali from EFCIL. Firstly, congratulations to the team at EFC on the performance.

37:51 We look forward to seeing this growth trajectory maintained on a quarter to quarter basis. Sir, I have a few questions. Hope I can ask them. Please go ahead, Yes. So sir, firstly, revenue is down by 3% quarter on quarter and the EBITDA is also down 14 quarter on quarter. But if we see the profit after tax that has gone up. So can you please explain what has driven this PAT increase despite the weaker operating performance? There is first of all, there is absolutely no weaker operating performance at all. The EBITDA reduction is primarily because of the way the India's accounting works. There is absolute what we've always maintained is the best way to look our company is to look at the PAT level. And if you see the PAT level, the company has improved its rather profitability.

38:46 And hence, the reason behind this improvement is obviously the outcome of our integrated business model, where we are able to bring so much of efficiency, so much of cost control, so much of economy of scale that we are able to kind of achieve this thing. Then specifically if you talk about the leasing vertical has performed very well, if you look at the segmental result also. In fact, the design and build vertical despite there's a little reduction in the turnover compared to the last previous quarter, which is, as I've explained in my earlier question, it is largely because of that the Q1 is generally the slow starter relatively. And if you look at my Q1 for the previous years, you will also witness that.

39:31 But right now, the order book already in hand shows a strong visibility going forward and hence kind of establishes whatever target that we have set could be achieved in terms of growth on Y o Y basis for this financial year also. So what I'm trying to explain is that if you look at it all these situations and also the incremental businesses under the Furniture business also, All of this coming together and our core business model is enabling us to offer a better profitability, enabling us to kind of improve our margins. If you also look at that, we have kind of rationalized our borrowing costs significantly and hence that is also contributing to the bottom line significantly below. So if you look at from a bad point of view, that is why there is a significant improvement in the bottom line because there is a rationalization of borrowing costs as well.

40:25 With the borrowing costs, again, as you already may know that it is largely towards the assets that we have acquired, that is towards the lab or the LRD facilities that we generally avail. So what I'm saying is overall the performance, the positivity on the pack is contributed through obviously the better capital deployment strategies, obviously better operating performance because of the integrated business model and also the kind of scale at which that we are operating hence brings the efficiencies. Understood, sir. Understood. Sir, as you said that the leasing business did well and obviously the results showed that. But the competition from all these competitors, AWFIS, Smartworks, WeWork India, IndiCube and last, Landaul is sincerely growing.

41:21 So what is EFC's key differentiator, which is keeping EFC on the edge beyond your price? Look, what is that which is beyond price and speed of execution? And how do you look forward for the entire year? So yes, Mr. Ali, I mean, keeping out price and speed of execution out of the equation is very difficult. And that is one of the key differentiators obviously, which we drive and which has been our kind of one of the of business model that always has been. Listen, competition is always there in every businesses. I mean and without competition, you also do not try to grow further. We really thrive with the competition around. And fortunately, if you see all our competitors have adopted a very unique business models and we have our own model, which is an integrated business model, which is a real estate as a service business model. We have kind of as Mr. Udaywara would have explained in his speech that we are able to make us more accountable and kind of offer us as a complete solution or a complete package to our customers where we are giving them a complete turnkey solutions for any leasing requirement that our customers are looking at, where they don't have to really look at whether, okay, if I have to take an asset and get it leased or whether I have to get it designed and built or whether I have to source my furniture, everything is happening at one place. So I think what is our mode in this entire business, if you

42:53 see, one is this integrated business model, which kind of brings that economy of scale, that brings that economy of efficiencies, bring the kind of the abilities where we are able to improve our margins overall. And what we are also able to do is that our presence across these multiple cities kind of able to kind of make the model harder to replicate for others because we are just not just doing only a pure leasing or co working platform, but we are into enterprise led revenue businesses where we have design and build, furniture manufacturing and leasing revenue all coming together and kind of making an integrated three multiple revenue streams that is enabling us to kind of grow going forward. So what I'm trying to say is that the more comes if you look at it in terms of the revenue streams that we have developed, which is three different revenue streams, not a single revenue stream with cost centers, but three different revenue stream with three profitable businesses that verticals that we have developed, number one. Number two, obviously, the integrated business model and hence the economy of scale.

44:11 And number three is obviously the price and execution capability. And number four is certainly the design capabilities. And number five is certainly the fit out cost optimization that we've been to kind of achieve over the years. So these are the key differentiators for us in the market and we believe that this will and further lastly, I mean sorry to miss out, but lastly to add, which we have kind of mentioned this time in our presentation also that our ability to do the asset monetization and hence achieve the capital appreciation as an additional source of revenue for our investors and hence that adds further to our overall mode that we bring as an organization. Absolutely, sir. Interesting.

44:59 So last one, sir, if you allow me. Please go ahead. Yes. So sir, can you just explain what the city concentration as of today? And where do we look forward to build more? Yes. So I mean the city concentration is obviously there in the presentation. If you see there is a we have kind of done a regional bifurcation of how our presence is kind of across India. Yes, right now, we are heavy on the Western India because that's been our kind of that's where we started our journey from. But we are very strongly going forward, we are kind of expanding our presence across India on an equal footing level. If you look at now, we are more than 15% in North India, We are more than 15% in Southern India and we are also continuously growing in the Eastern India. So I think with this expansion and our focus will also remain in that those three city quarters of North and South, let's say, in North, you have Gurgaon, Noida, Delhi and on South, have Hyderabad, Bangalore, Chennai because those are those three cities we are very focused.

46:18 The West India, I mean from business wise, it's always been the strong locations where we have locations like Bombay, Pune, Ahmedabad, Indore. To some extent I would consider even Rajasthan, the Jaipur. All of these locations are those business cities and they are obviously thriving and hence our presence would also increase on those cities. Right now we are focused on the 10 major cities, which is three in the North, three in South and about three in West, which is Mumbai, Pune, Ahmedabad and a couple of them in the Eastern side, is obviously Kolkata going forward. So that's where our presence is right now and that's where we are also looking at expanding ourselves.

47:06 Yes sir. Congratulations sir and we look forward. Thank you so much. Thank you. Ladies and gentlemen, we will take that as our last question for today. I now hand the conference over to Ms. Nidhi from MUFG in time for closing comments. Over to you, ma'am. Thank you. Would like to thank the management for taking the time out for the conference call today and also to all the participants for joining this call. If you have any queries, feel free to contact us. We are MUFG in time Investor Relations Advisors to EFC Limited. Thank you so much. Thank you. Thank you. On behalf of EFC India Limited, that concludes this conference. Thank you for joining us, and you may now disconnect your line. Thank you.