Kanpur Plastipack (NSE:KANPRPLA) Q1 2027 Earnings Call

0:00 Ladies and gentlemen, good day, and welcome to the Q1 FY 'twenty seven Earnings Conference Call of Kanpur Plastipack Limited. Today, we have with us today Mr. Manoj Agarwal, Chairman, cum managing director, and mister Shashank Agarwal, deputy managing director. We will begin with opening remarks from the management followed by an interactive q and a session. Please note that this discussion may include forward looking statements, which should be viewed in conjunction with the risks and uncertainties that the company faces. 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.

0:54 Please note that this conference is being recorded. I now hand the conference over to Mr. Manoj Agarwal, Chairman, KANPRPLAY Managing Director, for his opening remarks. Thank you, and over to you, sir. Good evening, everyone, and welcome to Kanpur Plastipack Limited's earning call for the first quarter of the financial year twenty six twenty seven. Thank you all for joining us today and for your continued trust and confidence in the company. On behalf of Kanpur Plastipack Limited, I extend a warm welcome to all of you, all investors, analysts and stakeholders to our earnings conference call for the quarter ended 06/30/2026. The first quarter of financial year twenty twenty seven marks a strong beginning to the financial year for Kanpur Plastipack Limited.

1:44 During the quarter, the company achieved two significant milestones. First, by reporting quarterly total income exceeding INR 200 crores for the first time. This reflects the resilience of our business models, the confidence of our customers and the disciplined execution of our teams. Second key milestone during the quarter has been the successful operationalization of our joint venture with Essigoma Italy. Commercial production and sales of premium Taslan yarn have commenced marking our entry into a new value added product segment and strengthening our capabilities in technical textile applications. Through this partnership, we are bringing advanced technology and specialized product capabilities into India, particularly in premium polypropylene plastic niyans and high performance applications.

2:38 Beyond expanding our product portfolio, this collaboration strengthens our technological capabilities and positions us to serve evolving customer requirements more effectively. We have successfully obtained two internationally recognized certifications, global recycled standards called GRS and VilcoTex marking a significant milestone in our journey towards sustainable innovation, superior quality and global competitiveness. These certifications are expected to strengthen our position in market, enhance customer confidence and support value creation in the coming quarters. Based on the encouraging customer response, we are confident of scaling up sales from the Q2 of the current financial year.

3:25 The global business environment continues to remain dynamic during the quarter, influenced by geopolitical developments, evolving tariff policies, volatility on raw material prices, elevated ocean freight costs and supply chain disruptions. Despite these external challenges, our diversified export presence, long standing customer relationships and agile business approach enabled us to deliver another quarter of healthy growth. Our focus in the quarter remained unchanged. We continue to execute our long term strategy of strengthening the quality of our business while creating new avenues of growth. Rather than pursuing growth purely through higher volumes, we remain committed to improving our product portfolio expanding into value added applications and building capabilities that will support sustainable profitability over the long term.

4:14 FIBC continues to remain the cornerstone of our business. Over the years, we have established enduring relationships with customers across international markets, enabling us to maintain a stable business despite changing market conditions. Our diversified customer base across Europe, North America, South America and other international markets continues to provide resilience and balanced growth opportunities. Our continued participation in international trade fairs has strengthened our inquiry pipeline and helped us expand our reach into new markets. As informed earlier, the capacity expansion of FIBC to further add up to 6,000 metric tons per annum over the next five years is on track. Construction of a new building is progressing wherein Ground Floor has been completed and production started.

5:04 1st And 2nd Floor of the building will be completed by the middle of September. While strengthening our core business, we are equally focused on creating the next phase of growth. Our investment in premium polypopular yarns technical textile solutions and specialized applications reflect our vision of transforming Kanpur Plastipack into a diversified industrial packaging and technical textiles company. These initiatives are intended to expand our addressable market while improving product appreciation and enhancing value addition. One of the key strategic initiatives for the company continues to be our entry into the non woven technical textile segment. We believe this business offers significant long term opportunities across sectors including automotive, interior, geotextiles, artificial leather, carpets and footwear and other industrial applications.

5:56 With commercial production expected to commence during the current financial year, this business will gradually emerge as an important contributor to our future growth while complementing our existing packaging portfolio. The company remains on track to commission the non owned private facility in Q3 of twenty sixtwenty twenty seven. Our entry into this space also opens up opportunities in select B2C linked applications over time, which can further diversify our business model and create new growth drivers. Sustainability also remains central to the way we operate. We continue to strengthen our environmental, social and governance practices through responsible manufacturing, energy efficiency initiatives and continuous improvement in our operational process.

6:42 Overall, the near term market conditions must continue to witness periods of volatility. We remain confident in the strength of our business model, our diversified customer relationships and the strategic investments we have made over the past few years. Our objective remains clear to build a stronger, more diversified and future ready organization capable of delivering sustainable growth and creating long term value for all our stakeholders. With that, I would now like to invite our Deputy Managing Director, Mr. Sushant Agarwal to take you through the operational and financial performance for the quarter in greater detail. You, and good evening to everyone joining us today. As the Chairman highlighted, we have begun FY 'twenty seven on a very strong note, achieving several important milestones during the quarter.

7:32 Before discussing the operational highlights, let me briefly take you through the financial performance of the quarter. For the first quarter FY 'twenty seven on a stand alone basis, despite the global disturbances and supply chain disruptions, the company reported a total income of INR 207.49 crores, reflecting a healthy growth of INR 13.86 crores year on year. EBITDA for the quarter stood at INR 22.19 crores, registering a strong growth of 58.98% year on year. EBITDA margin improved to 10.69% from 7.66% from the corresponding quarter of the previous year. PAT stood at INR 12.14 crores, representing an impressive growth of 112% year on year, while basic EPS increased to $4.96 compared to $3.01 in Q1 FY twenty twenty six.

8:28 Our focus on improving product mix, operational efficiency and disciplined execution combined with the strength of our long standing relationships with our suppliers and distributors enabled us to navigate the crisis effectively and report a robust year on year growth in EBITDA and net profit. During the quarter, the company witnessed a significant improvement in realizations with an average selling price increasing by 21% in comparison to the previous quarter. However, the average raw material price increased by only 18% in comparison to the previous quarter. Thus, the increase in realizations significantly outpaced the increase in input costs. This favorable pricing environment, coupled with our disciplined procurement strategy and improved product mix, contributed to a stronger margins during this quarter.

9:19 During FY twenty twenty five, twenty twenty six, the company generated a profit of INR 10.38 crores from trading activities, out of which INR 7.55 crores was recognized only in Q4, driven by an exceptional market volatility and supply chain disruption. During Q1 FY 'twenty seven, the company reported a trading profit of INR 2.93 crores as compared to INR 1.25 crores in the corresponding quarter of the previous year. Our primary focus continues to remain on our core manufacturing business. However, given our deep understanding of the polymer market and import opportunities, We selectively capitalize opportunities arising from temporary market dislocations and price volatility.

10:11 We will continue to evaluate such opportunities prudently while maintaining a disciplined approach to inventory procurement and working capital management. Employee costs during the quarter increased by approximately INR 3.5 crores compared to previous quarter, primarily due to the annual salary division and the increase in minimum wages in line with the state government's revised wage policy. While this has an increased operating cost, the company continues to implement focused initiatives around mitigating this risk like cost optimization, operational efficiencies, productivity improvements, automation opportunities and value added products. We are confident that over the next twelve to eighteen months, we should be in a position to mitigate this increased cost.

11:05 On the debit side on the debt side, the net debt on June 6 stood at INR 132 crores, a long term of INR 34 crores, which was about INR 112 crores on 03/31/2026. Exports continue to be the backbone of our business and remain a significant contributor to overall revenues. During the quarter, Europe continued to be our largest export market contributing to about 60% of exports, followed by South America about 20% and North America about 16%. Australia and Asia stood at about 4%, 4.5% and Africa at 0.5%. This diversified geographical presence helps us mitigate regional demand fluctuations while ensuring a balanced and more resilient export portfolio.

11:53 Coupled with long standing customer relationships built over several decades, it enables us to maintain stable business momentum and deepen our engagement with existing customers across global markets. Even from a product portfolio perspective, our portfolio remains quite diversified. In Q1 FY twenty twenty seven, we did 52% of FIBC, 20% of fabric, 12% of small bags, 8% of multi filament yarns, and others contributed about 8%. Even within these four categories, these products are for different applications and different industries, which further enhances our diversification attempt. From an end user perspective, our revenues sorry, as the Chairman highlighted, our premium polypropylene tasland yarn business has made an encouraging start with a successful commercialization in Q1 FY twenty twenty seven.

12:53 We remain very positive for the sales to boost start boosting from Q2 FY twenty twenty seven, which is supported by customer responses, internationally recognized certifications that have been obtained and brand owner approvals that have already been obtained. Through our joint venture with Esagoma, we are introducing advanced manufacturing capabilities, specialized products and addressing a growing customer requirement for extremely high performance industrial application and luxury application, which is completely recyclable. Nonwoven technical textile project also progressed well during the quarter. Construction and installation activities are progressing as planned. We expect revenues to start coming in Q3 twenty twenty six, twenty twenty seven.

13:43 Once operational, this facility will enable us to address a significantly larger market opportunity across automotive interiors, geotextiles, artificial leathers, carpets, filtration and several other industrial applications. This business represents an important pillar of our long term diversification strategy in products and industry applications. On the manufacturing front, we continue to invest in automation process optimization, infrastructure enhancement across our facilities. Our capacity expansion initiatives also continue to progress in line with our long term growth. At Valex Ventures, certain customer supplies were strategically delayed and scheduled after the first night first fortnight of July to align with the implementation of free trade agreement with The UK, therefore, enhancing our commercial competitiveness.

14:38 Coupled with structural changes undertaken in Valex, we are optimistic about improved operational and financial performance in FY twenty twenty seven. On the raw material front, polymer prices, which witnessed significant volatility during March to May twenty six due to geopolitical developments have largely stabilized, providing improved visibility for procurement planning. However, there needs to be a caution on the logistics environment that is now playing with the ocean freights increasing substantially from about $2,000 to about $5,000 in the last two months. We are continuously closely monitoring the foreign exchange movements and other global trade developments.

15:27 Despite these external challenges, our disciplined procurement strategies, strong supplier relationship, diversified customer base, proactive engagement with customers continue to support operation stability. Demand visibility continues to be about four weeks reflecting the current procurement pattern of customers. They do not want to procure at extremely high prices. Squashes procurement approach also helps in stabilizing demand in the latter part of the year. Building on the strong momentum established in Q1, we remain optimistic about opportunities ahead. Demand across our core export markets remain stable. Investments in technical textiles, premium value added products and manufacturing capabilities are well positioned to capitalize on the emerging opportunities.

16:17 We will continue to focus on operations expense, customer centric approach, innovation and product development and disciplined financial allocation. Backed by progressive commercialization of our strategic growth subject to prevailing market conditions, we should deliver a strong performance in FY twenty twenty six, twenty seven. With that, we conclude our opening remarks. Thank you once again for joining us today. We should be very happy to take questions now. 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 the 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 assemble.

17:12 The first question is from the line of Gupta from Asset Manager. Please proceed. Hello, sir. Sir, I wanted to ask that you were witnessing some raw material volatility because of West Asia conflict. So I wanted to understand how is that progressing for us. So there are two parts to it. One is the conflict itself that created a disruption because it was unexpected. So there was a high level of an expectation in March when this happened. Now even while the prices continues to be there, the market has understood the crisis and the supply chains and the governments are taking actions what are required to be taken now. So there is more stability.

18:00 That kind of extreme volatility is not there. So it was moving plus minus 25%. At that time, now it is moving plus minus 10%. That is the difference. There was also a significant difference that in March, there was also a government order which prohibited petrochemical companies to make petrochemicals alone, and rather they had to prioritize LPG production. That also has been relaxed now. So so is that something that we can pass over to our customers? So in our business, mostly, whatever the raw material increase and decrease is either ways. We are able to pass it on to the customers. There could be a lag of two weeks or one month or one quarter depending on the market situation, but it always gets passed on.

18:53 Okay, sir. My second question is this b two c segment, you know, b two c linked premium applications that we're trans... Transitioning towards. So what is the marginal differential for this line of segment? What can we expect? So we are talking... So in b two c, there are two parts. One is the scan and the other is the technical textile. So I will first cover the second part. So second, we are expecting the revenue of about INR 10 crore rupees this year, which should be at an EBITDA level 20%, 25%, which is significantly higher than what we are doing. I have been repeatedly saying that it is very hard to do the first 10, and then it's going to get easier to do the next 19. And then from there, the sky is the limit.

19:43 But we are looking at 20 to 25% end of EBITDA. On the nonwoven technical textures, we are looking at the mid level double digit kind of EBITDA on b two c in nonwoven. So so what is the, like, total EBITDA margin that we're looking for for this For the entire for the entire company? Yeah. Well, I I would not be able to give a very exact guidance on it at the moment, but we should be able to continue the level that we are at. Okay, sir. Thank you. Thank you. The next question is from the line of Saket Kapoor from Kapoor and Co. Please proceed. Yeah. Namaskar,.

20:30 Namaskar,. Thank you for this opportunity. Just in continuation to the earlier participants, if if you could just explain to us, sir, for the s... SCAM part of the story, what would be the peak revenue on the current installed capacity or the JV which we have done? And when will we anticipating? I mean, how much is it INR 10 crores in terms of capacity you're trying? 10 crores is about... So we can reach maximum volume of about 30 crores with the current capacity. Okay. And that once we once we reach that optimum number, then only we can look forward for how we're going to No.

21:18 The moment the the moment we reach 50 to 60% of the capacity, we will be installing more capacity. Because the cost of adding capacity is not very high. It's not a very high CapEx kind of thing. And now coming to the FIBC part of the story, sir, I think in your opening remarks, you did mention that our realizations have gone up. So if you could just give that understanding how the current realization is being and if our cost structure, the gap between the increment increase in the revenue and the cost is less, we have got the highest of the two, then why are the margins not expanded for the quarter? If you could just explain what factors did did not allow us to enhance the margin.

22:14 So the EBITDA margin expanded. Right? So EBITDA from manufacturing was at 12.6%. When we see manufacturing manufacturing, yes, it has expanded. So that is number one. Number two, it could have expanded more, but we can see that there is an increased employee cost of about 2 crore rupees a quarter, which has led due to the annual salary division and the increase in minimum wages of the state government. So my point was that you mentioned that Yes, just there's an additional point. The third point is that there was also a decrease in the total manufactured volume in FYBC due to the supply chain disruption and little labor disruptions also over there.

23:05 Yes, please. Okay. I will come to that part also. But you mentioned in your opening remarks that 31% was the value realization has gone up, the cost of RM is 18%. So is that understanding correct? You... In in the remarks which you made just now that there was 12%... The the market... That could be on a hold with 12% incremental margin. Is that understanding correct? Or how should we... Yeah. No. Average selling price increased by 31%. That's correct. And the average raw material price went up by 18%. That's correct. Okay. So the gap and the the entire gap will be cost. Is what the understanding should be. Otherwise So one thing Just say, how much the margin... So there was significant part of it is the employee cost, right, which is about one and a half percent.

23:55 SAE freight also has marginally gone up during this period. There are certain one time fixed costs which are also there, which was related to the disruption during this period. We also participated in couple of international exhibitions during this period. So everything put together in terms of variable cost on an ongoing basis, I am not very concerned apart from the labor cost that's going up. There is no significant increase in the energy cost. A little bit of packing cost was also increased during this period, then a little bit of oil because oil is also consumable in our item. That was also increased. There were also electricity disruptions during this period. So a combination of all these things put together.

24:41 Okay. So put to rest all these factors, we are now one third into the first... The second quarter. So can you explain to us which factors are behind us and which are still continuing to linger on? So I've already spoken about what is behind us in terms of the disruptions geopolitical, but we never know what happens again. So we are not taking a position or any kind of call on how the oil would be, how the geopolitical situation would be. We are trying to derisk our purchases against our sales. We are seeing wherever there is an opportunity. There are two challenges that could come up in the remaining part of the year. One is freight, which I mentioned that $2,000 freight has become $5,000 This could disrupt demand significantly because people might not end up buying so much in case the freight is so high. That is one part of the problem. The second part of the problem is we might have to share a little bit of this cost, which might damage the margin.

25:53 Right. Well, now if it's it's time for me, sir, for the FIBC parts and then I'll join the queue. You have mentioned about our target of capacity addition of 6,000 metric ton in five years. And and and and and for q one, our contribution was 52%. So as per our business plan, what would be the addition for the current year, and how will this ratio be? And then, sir, in your presentation, which which which is very very well and very exhausted also, so congratulations for maintaining this. Slide number 17, if you could explain to us that on a q on q basis also and a year on year basis also, our FIGC in the product mix has gone down.

26:44 So you did explain to the disruption, but what should now things be looking like, if you could just explain these two parts? For purchase on the incremental... Increment on the FILT capacity, what are we expecting this year and what explains this Q on Q and year on year decline? And how should this shape up for the Q? Yeah. So I think there are no questions that what is going to happen to FITC, which is the cash flow of the company and the main focus of the company. We are committed to reaching 5,000 tons per quarter. That is the target for next Q1. But Q1 FY 'twenty eight, that is the there. So directionally, we are in the direction.

27:36 Now from time to time, there have been procurement challenges in terms of raw materials. There have been demand challenges from the market. There have been manpower challenges in terms of the manpower availability. This has caused our pace to be a little slow, but I think most of it is behind us now, and we should be tend... Attending towards that direction. So as of... I do not want to give a very product mix percentage because this is all dependent on the selling price, whether freight is included, not included, what is the percentage of freight, what is the percentage of raw material. But directionally, where we want to move is 5,000 tonnes a quarter by next FY 2728.

28:22 Right, sir. And can you give the replacement number for this quarter for FY '23? So q one, we were only at 2,000 tons. Q four, we had done 3,500 tons. Q three, we were at 3,800 tons. So there is also seasonality to... Because of the... Based on the number of working days and number of holidays that are there. Okay. So, sir, seasonally, how is is q q two? And also, sir, since we have a four month... Four four weeks, sorry, order book visibility, this 3,000 should be the base for the year then? 3,073 number, which we have 3,003 thousand is a very, let's say, damaged number because it is much lower than even last year's number that was 3,500 tons. So this is mainly due to the disruption in the polymer and the labor disruption that was there.

29:18 But going forward, yes, it will only build from here. Okay. So follow-up, I'm coming in with you. Thank you for the opening remark and very detailed. Thanks. Thank anyone who wishes to ask a question may press star and one on their touch tone telephone. The next question is from the line of, an individual investor. Please proceed. Hi. Good evening, sir, and thank you for the opportunity. Sir, I have few questions. My first question is, what is the management long term revenue aspiration? Like, it is for the next three to five years. What is it, and what are the key milestones?

30:07 So thank you for the question, and thank you for a forward looking question. So with the current projects in hand and the installed capacity, we can touch thousand crores. So I would so I would say 2728 is when we would target $909.50, and then 2728 with thousand thousand 50. 2029. 2029. Okay. But this is with the installed this is with the installed capacity and the current trading turnover that has been there and the current polymer pricing. Now if there is a change in the polymer pricing, if there is any change in the trading, it might come up or it might go down.

30:53 Adding to this, next year, we should also be in a position to better decide on how we should utilize the money that is there in the balance sheet for further capacity expansion and the direction of the capacity expansion. Okay. And sir, next question is, are you seeing any changes in customer procurement behavior due to geopolitical tension? Yeah. So there are two types of behavior that are very evident. One is that who is trying to build a longer term inventory where they feel that your vertical risk might escalate. So they are trying to build more inventory. But majority of the market sees this as a situation to decrease their inventory because the prices and the freight have gone up.

31:45 So there are two distinct behaviors. Okay. And, sir, my last question is, are there any initiatives to improve our EBITDA margin beyond the current level? Yeah. I briefly mentioned that cost optimization, productivity efficiency, automation, digitalization, all these are ongoing at the moment, and this has caught speed with the increased labor cost and increased minimum wages. Okay. Thank you for the opportunity, sir. Thanks a lot. Thank you. The next question is from the line of Yash Parker, an individual investor. Please proceed. Hi, sir. Am I audible? Yeah.

32:31 Firstly, sir, congratulations on good set of numbers. And so what tangible benefits have The UK acquisition and Italian JV delivered so far in terms of customer additions, pricing improvement or order pipeline? And when should investors start seeing measurable financial results? So as you can... The Italian joint venture, the... Since the beginning, we've been saying that it is a high gestation, low CapEx, high value report because it has product research involved in it. There is approvals from brand owners.

33:16 There is a certification process that is there. So all that has happened now. So now the sampling is happening. So we would see significant commercialization in Q3 and Q4. And once that is successful, I would be in a better position to give guidance on this by Q4. But directionally, it will move from a journey of INR 10 crores to INR 25 crores to 50 crores to 100 crores. That would be the year wise target going forward. The speed of it and the success of it would be very clear by Q4. The GRS, Global Recycling System, the GRS and OEKO TEX certification that we have received are extremely strong levers amongst the brand owners.

34:03 They are extremely... They are as excited as we are to get this done. Regarding Ballix, Ballix has timid revenues with timid bottom lines, and we are continuously trying to build the operating structure of the company so that it is able to pivot into significant increase in revenue and bottom line. Till now, it has not given any significant tangible benefit. The only tangible benefits that are there are that it is able to create brand awareness within end users. We have been able to build design solutions within users, which will affect the lifetime value of the customer that will go up.

34:52 Obviously, whatever turnover is coming from Valex, it's a manufactured manufacturing transferred turnover. So that profit is also already there in the operations of KANPRPLASPARK. So second question is, like more than 60% of the energy is now sourced from renewable power. So can you quantify the annual cost saving that has already been realized then? And how much additional savings are expected once we are at full capacity, like, at nearly full operational thing? It is already at full operational thing, renewable. So we are only doing 60% and we only plan to do 60% at the moment.

35:41 We are in discussions for battery energy storage systems, but I think that is still a couple of years away. Whenever... Because the cost of acquiring the system is so high that today it is not making sense. What we are able to save annually is about close to 3 to 5 per rupees a year. Is that what we're able to save annually? Okay. So regarding the FIBC expansion, so the new one, we will add around 6,000 metric tons over the five years. So based on the current demand, how quickly do we expect this capacity to reach around 70%, 80% utilization? So 6,000 tons is over the next five years. Out of it, one year has gone.

36:31 So we are saying that we will add 1,200 tons every year. So it will take four to five years to achieve that required output, but that is not only because of the demand, but it is also because of the skilled workforce that is... Has to be trained. Right. And so our revenue grew 14%, whereas EBITDA grew nearly 56, 57 odd percentage. So does this indicate that we are like prioritizing profitable orders over the volume change? We have to see it from a macroeconomic point of view also. There has been extreme volatility in raw material.

37:19 Mhmm. There has been an extreme opportunity in the market. So it... Obviously, the aim is to maximize profit. There is no fun in doing sales without profit. It is obviously the aim. But has it happened only because of that? I wouldn't say yes. Okay. And, sir, we are currently doing multiple expansion projects. What is the minimum IRR or IO... ROCE hurdle rate that the management puts before, like, approving these investments? So in nonwoven, we were expecting between 15 to 20% IRR and a rose of above 20%. The other second is far higher rose and IRR because there the capital investment is extremely low, but there is far more investment in brand building certifications and efforts.

38:19 Got it. And so as our business ramps up, should working capital remain at current levels? Or do you expect inventory and receivables to increase? So for the FYBC business and the Rafia business, it would remain at similar levels for whatever turnover the nonwoven business would add. We would continue to add thirty to forty days of working capital. Okay. So last question from my end. So the trading revenue has increased meaningfully. Is this a strategic business that the company wants to scale, or is it, like, largely opportunistic? Yeah. No. I mean, I covered it last time as well, and I can... I covered it in my opening note as well that it is completely opportunity driven. There is absolutely no focus of the company to do it.

39:09 But if there will be an opportunity, we will be there to take use of that opportunity. Okay, sir. That answers my question. Thank you so much for the opportunity. Thank you. The next question is from the line of Dia Jain from Saphyr Capital. Please proceed. Hi, sir. Am I audible? Yes, you're audible. So what is the target revenue mix in, like, two to three years? I already covered that in the second or the third question. Okay. So can you share the realizations that we have currently and if we are going to sustain them? Any idea?

40:03 Sterilizations are based on the input raw material cost in the freight. So, yes, they should be sustainable... Sustained at the moment because we have... The raw material cost is sustained at the moment. So, I mean, they remain in line with the raw material cost normally. I... Can you also provide the revenue expectations from the premium PPR? Should be about 10 crore rupees per year in a second. And for the for the coming years, any expectations or targets? We've already shared that, but we will continue to grow. The ultimate aim is to reach a 100 crores in the next four years on...

40:56 As I can. The next question is from the line of Muskaan Patel from JK Investments. Hello? Yes. I just want to ask since the export continues to remain diversified, Is there any direct impact because of geopolitical tension going on currently? Yes. The impact is there on pricing and freight, but we do not have any significant exposure in West Asia or Middle East. Okay.

41:44 Thank you. Thank you. Thank you. The next question is from the line of from Kapoor and Co. Please proceed. Yes, sir. Just a couple of data points pertaining to the. For this quarter, we have seen an impairment loss of only to the tune of 25 lakh rupees. So if I'll ask my CFO to answer this. I'll ask my CFO to answer this. Yes, sir. So there is some supply that the company has made to the government of India for for FCI. So basically, for prudent of... To have a prudent policy, we have made a provision of 25 lakhs from the business. Although there is no... Certainly, the the the money will will not come. But, yeah, for the prudent business, we have taken up this decision. Because it's a tender government supply.

42:38 Normally, are some shortages or quality complaints that come in. What is the total value of the contract, sir? 15 crores. 15 crores. And this is the prudent 25 lakh rupees is what we have. Yes. That is historically what we've seen is around that. And in continuation debt number, what is the debt number currently we have and what should be the how will are we going to exit the current year in terms of the long term debt? Understand. At present, we have INR 34 crore of long term debt at present in our book. And by the year end, it will be near about INR 74 crore because the INR 40 crore new term loan we will take from here for the new project that we are making.

43:30 And our working capital requirement of what are currently is there and what will be And and let me complete with with your previous question. There will be some repayment of near about 5 to 7 crore rupees from... In this year. So the closing number in this year will be near 67 to 68 crore rupees. Sir, working capital So working capital presently, we are taking is near about 98 rupees and as our sales will grow, so it will be near about 5 to 10 rupee by the end of this year, I think.

44:18 Utilization will be like this. So, Sandeep, you mentioned about the certification part of it. So that is about the recycling part of the studio or what kind of differentiation are we currently seeing with the GRS. You have mentioned? GRS is global recycling system. So the certification is for using 100 post consumer recycled polymer to make the textile high performance. This GRS. And is a textile certification that talks about the toxicity of chemicals and minerals in the product. So it proves that there is no toxicity in that product.

45:06 So means that these are these will have many in that space where we operate. Business is very valuable. Okay. And it is it is then support for companies to get this kind of money. Your competitors are also there in the... In one... Having this kind of certification or we are... These are... We are the out... Outlier here? We are an outlier. Thank you. Ladies and gentlemen, that was the last question for today. I now hand the conference over to Mr. Ankush Srivastava, company secretary for closing comments. Over to you, sir. Yes.

45:53 On behalf of Plastipack Limited, I thank you all the investor, analysts and stakeholders for joining and spending your time and joining the conference call for the quarter ended June 26. Thank you so much. Thank you. On behalf of Kanpur Plastipack Limited, that concludes this conference. Thank you for joining us, and you may now disconnect your lines. Thank you.