Thank you. We will now begin the question -and-answer session. The first question comes from the line of Naveen Sahadev with ICICI Securities. Please go ahead.

Yes, good morning, sir. So, thank you for the opportunity and also thank you for the detailed initial comments. Two questions. First, of course, is on the paints business. So, needless to say, the company has done a commendable job. I believe for the quarter, the revenue given, like, Rs.8,500 crores run rate for the Birla Pivot and numbers that are published for UltraTech, our sense is paints would have done roughly Rs.1,200 crores kind of revenue in this particular quarter, which, of course , is great from the start that we have had. My question is the growth is seen maturing , in the sense in Q1, a similar sort of a very rough cut working suggested Rs.1,100 crores kind of a growth in the June quarter, similar flattish in September, and now we are at Rs.1,200 crores, give or take some margins there, I mean, some buffer there. Now, to reach the scale of Rs.10,000 crores exit by Q4 '28, which is around Rs.2,500 crores revenue over the next nine quarters, we need to grow at 40% CAGR year- on-year for us. So, I am just trying to understand, first of all, what different than now the company will do or what convinces us now, given that the growth is maturing in the last one, two quarters, how should one look at this target realistically being achieved? And in that, what is also the industry value growth into consideration? That is my first question.

Okay. Thank you, Naveen. So , while you have done your internal calculations, I am not going to either accept or deny it. But all I can say, both in quarter-on-quarter basis, we had a robust more than double-digit levels of growth closer to between 18 % to 20% on a quarter -on-quarter basis, on an annualized basis, these numbers are tending towards the three -digit growth. So I do not know what number you have in your calculations and using words called “mature” when we have grown on a year-on-year basis by 300 basis points in the paint industry. And we see a similar kind of consumer uptake in the current quarter. On overall basis, we are seeing across geographies, a very strong demand for Birla Opus Paints and a large number of existing dealers who have joined us , have increased their throughput, and they continue to grow at levels of strong single-digit on a quarter-on- quarter basis. And we continue to add new dealers at a double -digit level on a quarter -on-quarter basis or half a year-half-a-year basis. So that is part one. Second part, which is besides consumer and dealer, we are also getting very good attraction from the contractors. And as I mentioned in my opening speech, more than 7.5 lakh contractors have joined hands and this number of contractors give us confidence that the growth will continue. We are still a single-digit market share player. We have a large capacity. Our presence is now on a Pan-India basis. We have reached every 50,000 population down. We are at least more than 75% of 10 ,000 to 50,000 population town. So , the growths are happening. We have a large portfolio of businesses. Consumer demand is building up and we remain confident and we continue to guide that we will deliver the Rs.10,000 crores in third full year operation.

Understood. So the price increase that we have taken, as you said, across 2% to 6%, despite that, you are saying, we are confident to achieve the revenue target?

So, you should understand the philosophy of price increase. We always want to maintain a particular distance from the market leaders, and we felt the distance was slightly more than what that was necessary and we are bridging that gap. That is the objective of price increase and there is no other objective. And obviously, we also want to test at what demand of consumer and contractor remains at the revised price.

My second question then was on your Birla Pivot business, and of course, extremely fast execution, much, much ahead of expectation. But, we had also, I think, hinted the first time we gave this target, the road to profitability or breakeven for this business was also like a billion dollar kind of a revenue run rate. So, is it now fair that since we have achieved almost, we are there, this business is breaking even or will start making positive contribution? How should one look at profitability for Birla Pivot from now going ahead? Thank you. These are my questions.

Thanks, Naveen. This is Sandeep here. On the profitability front, we are making progress similar to how we have done, how we have executed on the revenue side , and the growth has been, excellent over the last few quarters. We have been making good progress on bridging the gap so that we can get to breakeven as well. I think from our current estimates, we will exit FY27 at a breakeven level. That is our current estimate.

Thank you.

Next question comes from the line of Rahul Gupta with Morgan Stanley. Please go ahead.

Hi, thank you for taking my questions. Two questions. One, continuing on the Pivot point. I remember earlier you had guided cash breakeven by 2030. So , you are now front -loading it, accelerating it to fiscal '27 end, right?

Rahul, I do not think we gave the guidance of 2030 earlier. But, as I mentioned in response to the earlier question, FY27 exit, we should be exiting the year at breakeven. Yes.

Okay. That is great. My second question is on a point you made on the paint , you are testing waters with 2% to 6% hikes in January. Now , it is early days. Can you please help us understand how the acceptance has been? And if we look at the industry, which has been struggling with discounting, how should we look at the overall industry from here on, or let me put it this way, how volume versus value gap should move over the next year for industry and you? Thank you.

First and foremost, as I mentioned in the previous answer, the gap between the leader and us was high. And we have used this price increase primarily to bridge the gap. We obviously still are a single-digit player and our aim is to bridge the gap between our capacity, which is at 24% to our current revenue market share. So, that is part one. It is early time to be able to say what is the response to the price increase because we have had a certain range of products where we took the price increase on 28th of January , and the remaining range of products is happening on 25th of February. So , it would be better I respond to the consumer and contractor response after Quarter 4 Results are there, because we are still in the process of executing the price increase. But on a mid-to-long-term basis, what is our view about the industry? We remain very bullish. As I mentioned in my opening speech, the industry in Quarter 3 has grown by 10% to 11% or probably even 12% by volume. The challenges have been over focus on economy, sub -economy and putty base business. So, if we stop the down trading, and if you notice, Birla offers a more balanced approach. It is making every effort to premiumize the service with the launch of its paint galleries and where obviously the ratio of premium and luxury i s significantly higher and same is true for our painting services. We are making every effort to premiumize and ensure that in the mix, our rate realization remains at similar levels to the volume, and our attempt is volume and value to both move in tandem. As far as the industry is concerned, we believe that this year the industry may including Birla Opus, may grow by 5% to 6%. In FY2025, growth almost was nil. And by FY27, we are hopeful that it will come back to 8 % to 10% growth levels.

Great. Thank you so much. Wish you all the best.

Next question comes on the line of Nirav Jimudia with Anvil Wealth. Please go ahead.

Yes, sir. Thanks for the opportunity. Sir, just one question on the chemical s side. For the epoxy business, just wanted to have your thoughts, a), with the trade deal done with the USA now and Chinese currency also appreciating by close to around 8 % to 9%, how do we see our exports to the USA market in the medium-term? And on a longer-term basis with now EU FTA also in place, how do we see our volumes in terms of exports to that region as well?

Thanks, Nirav. Hi, thanks for your question. Both are positive for us in a way. So, as you know that in epoxy, particularly in liquid epoxy resins, the Koreans have been available in India due to their FTA, they get a certain advantage that they can bring in product without put up the duty. And also, they had preferential access to the US as well as Europe. Now, clearly that advantage is going to go away. If you look in terms of timing, then the US deal probably will get actioned before the American deal. So, I am seeing a positive upside on export of epoxy from India to the US. Now, how much quantity that will be, how that will ramp up, etc. , is a matter of individual customer qualifications and those kinds of things, that is a little bit too much detail to get into right now. But , we do see a positive impact on that side. Similarly, if you look at Europe, as you know very well, Nirav, the European chemicals industry is struggling with high costs, both from perspective of energy, but also from perspective of extremely high labor costs. As you know, a lot of restructuring has been announced in Europe. You know equally that Westlake has stopped operations on their Rotterdam site. I think the India -Europe FTA in the longer -term will have a much more significant impact on the Indian chemical s industry, probably in my personal opinion, more than the US. Of course, the speed at which Europe will ratify, all this will get down into law, etc. , will be a little bit slower, but I believe that will be more sticky. So, both these agreements, Nirav, are, I think, positive for the industry.

Got it, sir. So, just two clarifications here. So, a), do we import any raw material from EU, which were earlier subject to taxes and now with this deal could help us from the chemicals business point of view also and from an overall business point of view also? And b), any volume guidance which you would like to share from the epoxy business point of view for FY27? Thank you so much.

So, if I look at imports from Europe, yes, we have some. I would not like to get into the details of what that is, but they are not a large part of our basket. So, I do not see really a large benefit from that. What I may think of is, if glycerin prices continue to remain high, then the propylene route to ECH has its own competitive advantage, right, and several of the propylene -based producers are Western-based, but there is a logistic cost hurdle. So, let us se e how this plays out in the l ong-term. If you look at volume growth, then if I look year-on-year, our overall liquid epoxy plus formulations, for the year-over-year, we have grown by about 6%. I expect this rate to ramp up next year. Now, how much it will ramp up by is a matter of speculation, but I expect that rate to ramp up further. None of the fundamentals have changed.

And safe to assume that this ECH price corrections which have happened on the upside , would translate into a similar increase in the prices of epoxy which generally gets passed on a lag basis?

Yes, there is usually a time lag associated with that. As I mentioned in the epoxy value chain, there are competing routes, right, glycerin-based ECH and propylene-based ECH. So, what may be a pass- through for me, may not necessarily be a pass-through for somebody else, maybe globally who may be propylene-integrated. So, depending on their crude prices, propylene prices, glycerin prices, the pass-through mechanism has a different cyclicality, but in the longer-term, it always passes on, right, it is always a matter of time, but the exact speed by which it passes on depends upon these three, four factors.

Sir, last clarification if you allow. This quarter we have seen a dip in our epoxy revenues. So, was it more because of the volumes were lesser this quarter and that should start correcting next quarter onwards, is this a right assumption to make?

So, just let me quickly check the data. Yes. So, volumes were slightly under pressure on the liquid epoxy resin side. Actually, maybe the better way to see it is, we decided not to take certain volumes where we thought the margin was getting too squeezed. That is probably the better way to see it. If I look at the non-LER business, all the formulation, within the specialties, there actually we have not had any volume issue. It is on the margin where perhaps the lowest profitable part of our LER business, we have been a little bit unwilling to allow our margins to get compressed too much.

Next question comes from the line of Amit Purohit with Elara. Please go ahead.

Yes. Hi. Thanks for the opportunity and thanks for the detailed data points on the paint. Just to recheck, sir, on the overall paint that we sold, we talk about 500 billion liters. That was since the time we have been into the market, right? It is accumulative or did I heard this correctly?

500 million liters, not 500 billion liters by the way.

Okay. That is since the time we have started operations with that?

Yes.

Okay. And secondly, sir, also wanted to understand when you talked about 300 b ps lower than the second player, that includes putty and everything, right, at this point of time, exit market share, you were talking about or -?

I am again saying what we said in the opening remark statement, Birla White plus Birla Opus value for Quarter 3 and guidance given by number two players , in our internal estimates, now the gap is 300 basis points. I hope it is clear. And it is only Birla White's putty business. It does not include any other business.

Sure. And sir, you have talked about the increase in new dealer addition. Just wanted to understand the typical profile of these dealers, if you could just qualitatively highlight these are large dealers or these are dealers largely from the market leaders , because typically, I mean, there is different types of dealers, and initially, when we started off, obviously, there w ere challenges to reach out to the very, very large dealers, what is the state now, I mean, in terms of acceptance?

We are getting bl end from all categories of dealers. In our internal assessment, we broken dealers into A category, which are more than Rs.3 crores, B category, which is Rs.1 crore to Rs.3 crores, C category, which is Rs.30 lakhs to Rs.1 crore and D category into less than Rs.30 lakhs. Most of the dealers are coming in the A, B, C , the small numbers also come in the D category, but our focus in the A, B, C category.

And lastly, the price increase that we highlighted, that is more from a testing perspective or is there any raw material pressure which kind of or do you think that from now on the brand is strong enough to kind of take pricing and still it adds value to the entire channel as well? Just wanted to know your outlook as you highlighted that next year FY27, the growth in the industry could be closer to about 8%. So the pricing volume graph should reduce in the FY27? That is the last question.

First and foremost, there are no current raw material pressure. Second, we have been consistently maintaining that we are at a lower price than the market leader and we felt the gap was higher and we reduced the gap. That has been the strategy around there. It is not a price increase strategy per se as you are reading it. Please read it that we would like to maintain a certain gap with a market leader and we want to test at that gap what is the consumer response. There was an X -gap that existed and we reduced that gap.

Sure. Thanks a lot.

Next question comes from the line of Pathanjali Srinivasan with Sundaram Mutual Funds. Please go ahead.

Yes, thank you for the opportunity. A couple of questions. So, firstly, could you explain a bit on our share of retail business and institutional business? Because I believe we have grown pretty fast in our institutional business, but I was just trying to figure out if the base there is lower or are we tilted more towards institutional business?

Okay. So, to our understanding, the retail -institutional business mix is 85 -15. We are not yet there on that mix. We are still a single -digit on the institutional business , retail is much faster to take off and institutional is a much longer gestation period. The message that I was communicating is that we have a strong pipeline and hopefully by FY27, we should be able to come closer to the industry average between 12%-15% on overall contribution from institutional business.

Sir,, could you give me some numbers for where we are in terms of range here?

As I explained, we were a single-digit number and we have a strong pipeline of institution, but retail continues to be the stronger forte for us at this point of time.

Sure. So, this number of saying that 18% we have grown last quarter and all of that, there is just one part where I have not been able to figure out. I met a couple of dealers from the time we started more recently and I have seen some of them saying that they have either stopped doing business or they are finding it difficult or something like that. While my sample size is very small, I want to know what is an acceptable level of pushback or reduction in dealers when we expand dealership and what are our targets here and where are we in that?

So, it is a large dealer universe. There are over 100,000 dealers. On an average, in a quarter about 50%-60% of the dealers are active. We are also experiencing a similar level. In fact, our sense is about 70%-75% in a quarter are active around there, and we are satisfied with the number of people who onboarded with us, with the number of people who are active in a given quarter. So, from that perspective, we are very satisfied both in the expansion pace of dealers both in the existing tow ns and new towns as well as the throughput pace of improvement of dealers. Most of the dealers who have joined us and have been consistent in network have continued to stay with us. We are very focused on our collection and there dealers who are poor pay masters are the ones probably you may be referring to.

Got it. Just to continue on that, I just wanted to know , what is our policy with tinting machines that we have given to dealers and where dealers have not been doing as much business as we like them , how are we dealing with them , and have you started collecting money for tinting machines that we have given to dealers?

No, we do not collect money. As we have already explained, we give the dealers free -of-charge tinting machines and that remains a consistent policy even in FY26 and going forward. Only , if a dealer does default on his payment for a long period of time , are any actions that are necessary, but it is few and far, and probably not relevant for this national platform.

Next question comes from the line of Prateek Kumar with Jefferies. Please go ahead.

Yes, good afternoon sir. My question is on paints. Can you just confirm again while you talked about your revenue expectation maintaining for FY28, what do you think on profitability ? Other-related question. You have like seen some increase in interest expense during the quarter sequentially and depreciation is this completely related to capitalization of six plants or also is there are any working capital changes which you expect because you are also increasing mix in your business?

I just want to be clear with your question is. You are referring to overall Grasim results and you are saying that the interest and depreciation component gone up. Is that what you are referring to?

Yes, that is right.

Yes, so in Grasim, if you are referring with the last year, the borrowing is used for setting up the new plants was being capitalized. In the 15th of October, we have commissioned our last sixth plant and now from next quarter onwards, there will be no capitalization and all the interest cost will be coming to P&L account. Does this answer your query?

Yes, sure. So, there is no material working capital changes, because we are shifting segment business to more institution that does not have an implication?

In paint business, we have capitalized over all the six plants, and no major CAPEX is pending and all.

If your question is on debtors, we are well in control as debtors and working capital is not a challenge. We repeat again, that the interest component in the past, a portion of that was getting capitalized and now the portion is significantly fallen, because from six plants now down to in our 15th of October, it is only one plant and that also a part of it was no more capitalized and the same applies to depreciation. As now all the six plants are fully commissioned, the full depreciation i s reflecting in the books.

Thank you. And the other question was on paint segment profitability which we are expecting for FY28. You maintain it as like turning positive in FY28?

Yes, we maintain our guidance. I will repeat . Within three years of full scale operation, we are targeting to be able to reach a profitable #2 position.

Thank you and all the best.

Next question comes on the line of Shreya Banthia with Oaklane Capital Management, LLP. Please go ahead.

Yes, thanks for the opportunity. So, if you could share what is the current share of renewable energy in the chemicals segment?

Exit rate is around 22%, 23% right now. And actually are targeting to reach an exit rate of over 40% by end of FY27, if you want to make a projection.

Thank you very much. That was my question.

Thank you. Next question comes from the line of Vipul Kumar Anup chand Shah with Sumangal Investment. Please go ahead.

Hi, thanks for the opportunity, sir. So when will we start sharing the revenue and EBITDA numbers of our paint business?

Shortly.

Shortly means?

Even today, because that is why there is portion of the material that has been produced and was not sold and they are still reflecting in the revenues which are getting capitalized. We are expecting to complete that and we will move on to this. We will share with you the exact dates when we do that. So, that is why this gap between capitalization, that is why the numbers what market calculates, there is a gap , and we want to finish all the material s that we have produced before commissioni ng and consume it, which remains in the capitalization.

So, should we assume that from next financial year you will start sharing those numbers?

We will definitely come back.

Okay. Thank you.

Thank you. Ladies and gentlemen, due to time constraint that was the last question for today . We have reached the end of question-and-answer session. I would now like to hand the conference over to the management for closing comments.

Thank you so much for participating on the Grasim Call. We are now going to close the call.

Thank you.

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