Jubilant Ingrevia Limited analyst Q&A

The first question comes from the line of Jinal She th from Awriga Capital Advisors LLP. Please go ahead.

Thank you for the elaborative and detailed inputs o f the business. Just wanted to catch a point that obviously, the new capacity has come on stream. And what you also mentioned is that we're currently operating at 60%, 70% utilization. Just wanted your thoughts on the fact that currently our demand environment is a bit uncertain. So, is this something that comes from ou r customer base that we've kind of expanded to that extent? Some thoughts out there would be useful.

Yes, Jinal, you're absolutely right. As we spoke in the previous calls as well, we have invested heavily in the last 2 years and creat ed new capacity in our businesses such as diketene, acetic anhydride, agro chemicals, etc. And because these are new product lines, except for acetic anhy dride, which we have been doing for almost 4 decades, in most of these situat ions, we have found new customers, we are selling these products to. And ac ross these plants, the capacity utilization is already touching almost 60% plus eve n in this environment. And as I mentioned in my opening remarks, as we get more volume traction, we are seeing that capacity utilization is only increasing month- on-month and quarter-on- quarter.

Okay. And secondly, is it true that the inventory c orrection, are we seeing that in China as well, where capacities are probably going off? Any comments on that?

Those are two different points, Jinal, from the des tocking perspective, as I mentioned in the past and even today, and we are se eing that in our business as well as hearing it from all our customers. The dest ocking seems to be at the far end after last 18 full months. From a supply perspe ctive, China, of course, at least in agrochemicals from whatever we understand, has created a lot of capacity, and we still think there is excess capacity there.

Okay. Just lastly, a connected question to the firs t question that I raised was that in regards to the capacity expansion that, would th at kind of lead to say suboptimal returns given the demand environment and obviously considered the way to put it is the pricing is not optimal at this stage. Is that a fair way to see that?

So, I think, Jinal, for the areas where we have put up capacity, most of those are, number one, specialty areas, high-margin products. Number two, these are products, if you look at our business mix, only 20% , 25% of our business is linked to agrochemicals, remaining 70%, 75% business is in pharma, in cosmetics, in nutrition. We are getting good volume traction as t he numbers also tell, if you look at our business by BUs. The volumes which are coming from there are helping us improve the capacity utilization. Of course, there is a pricing pressure in some product lines, but I don't think that will cha nge our overall return profile if you look at it from a multi-year perspective. Of co urse, a few quarters, pressure will remain. But at least from the overall recovery value as well as returns from those assets where we have invested we still stay bullish, and we think the NPV or the IRR of these products on a multiyear basis will be at par with what we had projected.

The next question is from the line of Rohit Nagraj from Centrum Broking.

One question in terms of the different segments and product lines that we have. So, what has been the competitive scenario from Chi na? Because as you had also mentioned in your opening remarks that there has be en a competition. So, which are all areas where we are seeing that the competit ion is coming. And which and all area where we still have a pricing power once t he normalcy returns from the inventory destocking and the other global phenomena , which are affecting the business? Thank you.

Yes, Rohit, I'll just add to what I said in respons e to Jinal's question, most of the pressure is in the Agrochemical segment. Obviously, there is competition in Nutrition and Pharma segments as well from China, but the level of pressure there is not as acute as it is in Agrochemicals. Just as an example, in some of the Agrochemical product lines, not just for us, but if you track the import data, the broader decline in pricing has been up to the 30%, 40%, 50% also. While if I take example of vitamin B3, which is on e of our core products in the Nutrition segment, the pricing has been flat for th e last five or six months and there is only a marginal decline versus what it was previous to that. So the amount of pressure vary significantly by segment, a s you rightly pointed out. It's more acute in Agrochemical. Nutrition and Pharma are largely stable.

Having said that, China plus one strategy with larg e companies still valid. And we are seeing some inquiries in the agrochemical intermediates, which are China plus one strategy. And as Deepak said that in the coming quarter, we are going to conclude a large contract for Agrochemical intermed iates. This is just related to China plus one strategy. And a lot of inquiries sti ll coming in. But since the China prices are so low, so people are trying to defer th e inquiries, but this inquiry is very strong, and we are able to conclude this business, which is a large business. And secondly, we are receiving inquiries for Agroch emical sector, but people are trying to defer those, the strategy after discussin g with large agrochemical company still remains still very active, that China plus one. But China being at such low prices, this is a wrong time to shift from Chin a to India. But of course, that strategy as in the next three, four quarters, the C hina prices are going to go up, then definitely, this strategy will come back in action again.

Yes. And just to add to Chairman, I think as for ev eryone is satisfied, because I'm sure that question will come. Most of the discussio ns we are having with our customers, be it agro, pharma or even let's say, co smetic space, particularly for the CDMO business, the customers are speaking to us despite whatever is happening to pricing and competition from China with a long-term view. And in many cases, they are helping us working wit h our R&D team to optimize the cost structure to ensure that we collectively a re able to take on the competition on pricing and then optimize our cost a ccordingly. So, couple of contracts that Chairman talked about are in line an d with that kind of arrangement with the customers.

Sure. That's helpful in terms of collaborate answer . Just to put it slightly differently. Out of the entire business, how much o f the business is, mean how much of businesses prices are governed by China or dictated by China, given that there are incremental capacities which have come up or which are coming up in China, will still have pricing pressure on those set of products or segments that we have.

So, Rohit, I don't have the precise number, but aga in, I will go back to what I was saying earlier and talk sector by sector, and then we publish that information in our investor presentation also. Agrochemicals is ro ughly 20%, 25% of our business. Obviously, there is a huge pressure there from China. Pharma is roughly 30% of our business. The relative impact of China p ricing is less there. And especially in our chemistries, be diketene, pyridine or some of the other products, we are able to command pricing. If I take nutrition, as an example, vitamin B3, we are world number 2, and we and China are more or less at par. So, any one of us ca n disturb the price or any one of us can command premium as well. Right now, it's a d eadlock where we are at a flat price, as I said, for the last six months or s o. So, the answer very significantly, it's not a zero sum game that these are the product s where China price does not impact, these are the prices where it can impact. I t varies significantly. There is obviously some impact when there is a competition f rom China, but the level of impact and implication of that are very different by segment.

In niacinamide also, having said that, there is mor e competition in the animal sector. Whereas in human and food sector, there is less competition, and we still get a price premium in that sector. And as Deepak m entioned about it that is why we have set up this new plant where we can supply f or cosmetic and for food and for sectors where the people are sceptical of impor ting products from China and China does it offer such high-quality material. So therefore, we command a premium there. Recently, also, in the food sector where we are fr om our existing niacinamide plant, we get a premium from what we supply to anim al sectors. The main competition is in the animal sector, at which, of c ourse, we being the lowest cost producer, we have an advantage. Of course, we canno t charge the premium pricing, only thing in the animal sector, but the f ood sector is still we get a premium price.

Sure, sure. That's really helpful. And thanks for t he elaborate description. Sir, second question is, given the current environment a nd overall scenario, are we planning to defer any of our capexs? Or we will sti ll continue to be doing the capexs or probably we will try to optimize certain capexs. Any views on that? Thank you.

No, Rohit, discussion had come up in the last two c alls also, the answer remains the same. We are on track to do the capexs that we planned. Just as a reminder, two, 2.5 years back, we had announced a Rs. 2,000 c rores capex. Of that Rs. 1,400 crores has already been committed in the last two o r three fiscal years. And remaining Rs. 600 crores of the original plan will happen in this fiscal year. In fact, on the back of some of the long-term arrangements t hat we are seeking to a few big customers, we may even need to up that number o nce we have signed a contract with them.

The next question comes from the line of Rohan Gupta from Nuvama.

Sir, first question is on your newly coined vision on Pinnacle 345. If you can sort of elaborate a little bit more on that making an initi al target of 4x EBITDA. Just wanted to get some more clarity how we plan to achi eve that? Which is the segment you're going to drive? And more importantly , this 4x EBITDA, we are talking about on a FY '24 base of EBITDA. Correct m e if I'm wrong on that and further elaboration on that?

Yes. So, Rohan, we have given at least some details in the results presentation also. I can keep talking about Pinnacle 345 because that's what we have been living and breathing over the last several months. But just a few things, top of mind, I would say, number one, this is a bold visio n and ambitious vision as you rightly called it. That has been co-created by the whole leadership team of Jubilant Ingrevia, we created in December. I think I had briefly talked about it in January call as well. It was originally created in a top-down manner, but subsequent to that, in the month of December and Ja nuary, the whole leadership team spent a lot of time in working out the bottom- up plans by the use for each element of Pinnacle 345, which you could hopefully see in one of the slides we have put in our results presentation. Obviously, that slide also is a 30,000 feet level. There are nth level of details in terms of what products, what market share, what cos t structure against which competition, which geographies, which customers and how. So, all of that has been worked out BU by BU, which we discussed, debat ed that there in January and closed in February with our final presentation to the board. So that strategy we firmly believe in, we think it is achievable. It is bold, but I don't think it is super bold because if you look at histo ry, there are several companies within chemical sectors also who have been able to achieve those kind of targets within a 5 year time frame. Secondly, we have some fundamental strengths in ou r business in terms of the 35-plus chemistries we do, the 7 or 8 product platf orms we have, starting from, let's say, our traditional platforms like pyridine but also newer ones like Diketene, pyrithione, Piroctone and many others. So, we have mapped out the specific opportunities, customers, geographies, which fall at the intersection of these product pla tforms and chemistries. And in a bottom-up manner, we have created this strategy. So , the level of confidence in achieving it is very high. Number three, a lot of capex investments related to these products and chemistries has already happened as I was just expl aining response to Rohit's questions. We have created capacity worth Rs. 1,400 crores of capex. That capacity now is coming on stream as I just said, it 's getting filled very quickly. So many of the product lines, which are part of our st rategy can be produced in this capacity. So, we have ready capacity, and that's wh y many of the customers are switching to us for long-term contractual arrangeme nts across Agro, pharma, nutrition, and cosmetic sector. Fourth and last thing I would say is there's a det ailed initiatives plan that has been created behind this strategy. There are 50-plus ini tiatives falling across different BU’s and different functions. Each BU head and func tional head is driving that initiative with his or her team. And I am directly championing it and my office is doing the program management of that. So, we are ta king a very rigorous approach to managing that whole process as well so that we stay on track. Obviously, the only unknown factor is how quickly the markets turn around, which is where our Chairman was also saying the hope is i n the next 1 or 2 quarters, things will start to come back. From a demand perspective, we are already seeing v olumes going up. If you look at our Specialty Chemical business and Nutrition business, the volumes have come back quite handsomely. Specialty Chemical, in fact, 30% up. Nutrition 10% up versus the previous quarter. The price is what we are hopeful that in next 1 or 2 quarters once China becomes less desperate, we will also start to see some upti ck there. And hence, we will be on track to deliver on this bold strategy. Hopefull y, there's a lot more we can talk about Pinnacle 345. Rohan, I am just restricting to 3, 4 main highlights right now. Let me know if you have any other questions.

No, that's helpful. Sir, in the current quarter on a Spec Chem business, the business has witnessed growth on Q-on-Q basis. This is something like EBITDA margins, which is still quite low at roughly 14% de spite such a strong growth on Q-on-Q basis by roughly 30%. If you can on a full y ear basis, if you can give some broader number of getting into granularity, but rou ghly out of close to Rs. 1,600 crores kind of specialty chemical revenues. If you can break it down a little bit in the CDMO and how much comes from the Ketene and in next year, what kind of revenue target we are targeting from the Diketene and CDMO?

So, since we don't disclose the numbers at individu al product platforms or growth units’ level, I wouldn't be able to give that Rohan but what I can tell you is, number one, obviously, the volumes have grown at 30 %. The pricing, of course, there is pressure even versus the last quarter, the prices came down for some of the product lines. And hence, the margins have not seen an uptick. It is hovering at 14%, 15% level. We believe that our Specialty Ch emical business even today, based on the today's product mix, is a business tha t should give at least 17%, 18% EBITDA margin in steady state. So, there's an erosion of 3%, 4% points versus what the steady margin in today's mix should be largely driven by the fact that prices are subdued or muted. Now if I fast forward into future strategy, then w e are going to have higher share of some of the high product lines we have added, th e Diketene derivatives, some of the pyridine derivatives, some intermediates on the agrochemical side, the new products from CDMO, etcetera. That 18% plus steady- state margin will surely be north of 20% plus margin in the next couple of year s. And that's how we have created all our business cases for the new capex we have made. So that's our aspiration. Within that, the Rs. 1,600 crores reven ue number that you talked about, I think we expect our Specialty Chemical bus iness as part of this Pinnacle 345 strategy also. Our Specialty Chemical business should become at l east three, three and a half times in next three years. At an overall portfolio level, it should be at least 60% of the overall business. And within that, bulk of the growth will come from CDMO, from our fine chemical business, which is where we have our pyridine and Diketene derivatives and from our Microbial Solutions business. And just one more addition, the CDMO business that I'm talking about, as we discussed in the previous calls also, I'm talking a bout CDMO related to agrochemicals, pharmaceuticals and hopefully, semic onductors as well where we have started to see some initial traction in the last few months.

The next question is from the line of Gokul Maheshw ari from Awriga Capital Advisors LLP. Please go ahead.

Thank you for the opportunity. I just wanted to kno w, in terms of your capex plan of Rs. 2,000 crores, you mentioned about Rs. 600 cr ores, Rs. 700 crores to be spent in FY '25. Could you sort of give a broader i ndication of what beyond that, I'm not talking of numbers, but more in terms of th e projects, which you would want to take once this capex experiment is being done?

Gokul, your voice was slightly muffled, but if I un derstood the question correctly, you're talking about the FY '25 Rs. 600 crores, wha t kind of capex you are taking? Is that the question?

Yes. So, your Rs. 2,000 crores of capex plan from F Y '22 to '25, I believe Rs. 600 crores, Rs. 700 crores would be spent in FY '25, bu t what would be the spends or projects which you would take beyond FY '25, if you could give some color on it and if you could even quantify, that would to be great.

Yes. So first, in this Rs. 600 crores, Rs. 700 cror es that we plan to do in this fiscal year, as I mentioned in my opening remarks, there a re a few opportunities which we have more or less decided but we are yet to do t he capex approval, let's say, I talked about the CC/CBT, the food grade human nutri tion product. We have the niacinamide product, which is coming up in Septembe r. There will be some capex related to that. We have a plan for GMP-3 for our CDMO business. So those are some of the areas that we are plannin g for this year. And beyond that, there are certain opportunities in horizon. O bviously, the concrete plans have to be created. For instance, this long-term co ntract we are negotiating with our Agrochemical customers we will need expansion o f current capacity. There will be some capex going there. We have plans for o ur diketene next phase of derivatives. We have done 2 phases. We have Phase 3 and Phase 4. We have a couple of products in Microbial segments where we a re evaluating GMP grade plants. Then on the microbial side, also, we have a new pl atform coming up sorry, for the human nutrition also, we have some premixes for whi ch we are expanding the capacity or we are planning to expand the capacity. So just stepping back, if you look at the priorities for our different BUs in the investor presentation, all the new capex, be FY 2025 or beyond will be aligned to that strategy and those priorities.

Given the number of initiatives, so beyond '25 also your capex range could be around Rs. 400 crores, Rs. 500 crores per annum?

Yes. So obviously, this original Rs. 2,000 crores a nnounced takes us to, let's say, the end of FY '25 in terms of capex deployment. And we feel the full potential coming from that Rs. 2,000 crores of investment plu s our existing business is, let's say, taking us close to Rs. 8,000 crores odd in terms of top line. For the 3x growth in revenue from today's baseline , we will obviously need more capex, at least another Rs. 1,500 crores to Rs. 2,0 00 crores based on some broad estimates. Of course, the details have to be worked out and that will translate to at least Rs. 500 crores, Rs. 600 crores every year from now onwards.

And lastly, on the margins front, you are investing more on the specialty, and you've mentioned in the past that the mix of this s pecialty would be becoming 60%, 70% versus the current 40%, 50% or so. With that mix coming in, what would be your steady-state margins? I'm not talking for t he next 12 months, but more from a 3- to 4-year perspective.

Yes. So, we have worked that out. So one correction it's not mainly, it's only. So whatever investments we are making, we are going to make only in specialty chemicals or specialty nutrition products like CC/CBT. For each of those capex, our internal criteria is at least 20% plus of EBITDA ma rgin and 20% plus of ROCE, otherwise, we are not approving those capex. In fac t, we are not even recommending that to the Board. Now if you take all of that into account plus what ever we have invested in the last 2 years, our view is at the overall portfolio level , our margin, as I was saying in the beginning, steady-state margin should surely be nor th of 20% plus. Specialty will be higher. Obviously, we have an acetal business, w hich remains volatile. Nutrition should be at least 15% plus. So, at the o verall company level, we are quite confident that if we execute this strategy successfully, we should be north of 20%.

Thank you. The next question is from the line of Pr anav Tendulkar from Rare Investments. Please go ahead.

Sir, in terms of the semiconductor product that you are planning to manufacture, is it for export or Indian, that is one? And is it for that wafer manufacturing level? Or is it related to cleaning and blasting, et ceter a? And what is the market opportunity in similar products?

So, Pranav, these are, as I think I mentioned on th e previous investor call also, most of these inquiries are coming to our CDMO business, which means by nature of our CDMO business, these are initial leads where customers are testing waters and giving us volumes in kg to see whether the prod uct quality is in line with their expectations. Most of these are international customers. I had mentioned, I think, in the January call that till that time, we had got ten 3, 4 leads. Now we have another half a dozen. We are evaluating internally, which ones are aligned with our chemistry strength, which ones are not. But mos t of these are coming to CDMO business. And right now, the focus is to make the product in line with customers' expectations and then send the samples. And once the samples are approved then we get initial volumes with them. And obviously, given that semiconductor segment globally is growing very fast , the hope is once we are in, then the volumes will grow very fast.

Yes. But having said that, I would like to further add that any large contract on CDMO and specific investments if we have to make, we'll be doing basically on the basis of take-or-pay. Otherwise, we will not be investing. All volume business on our existing multipurpose f acility that's a separate thing. But any specific investment if you make, any specif ic large investment which Deepak was talking about, if the contract materiali zes, then we will be doing on the basis of take-or-pay because that we'd not like to risk our investments on the basis of any contracts which are not take-or-pay.

And on the semiconductor side, which is where your question specifically was, Pranav, there, obviously, the volumes are small cur rently. So, we have multipurpose plants, whatever inquiries we have got ten so far and which we are responding to, we feel comfortable and confident th at we can do those products in our multipurpose facilities, which we have in th e CDMO business. Obviously, the big contracts on the agro side and some of them may be on the pharma side also. There the arrangement is very different which is, in some cases, we may need new facilities which are dedicated and hence, the Chairman's point that it would be take-or-pay contracts.

Right. Also, you commissioned 2 plants, one is that diketene derivatives and I think the cosmetic grade chemical product and you w ere also going to commission one more plant in in the next quarter. I missed the nature of the plant that will be commissioned Can you just elaborate what is that?

Pranav, your voice was breaking, but let me, I thin k just factually correct you. We have commissioned 3 plants in last 4 months. In Dec ember, we commissioned a small Agro intermediates plant in Bharuch. In Janua ry, we commissioned a bigger Agro intermediates and access plant again in Bharuch. And in February, March, we commissioned a diketene derivative plant, which can do 2 products. So, these are the 3 plants, which have come up in the last 4 mont hs, all aligned with our long- term strategy. The Agro intermediates plants, both the plants are targeted towards doing CDMO/CMO arrangements with our innovator customers globally in agrochemicals. In fact, from the bigger plant, we s hipped first CMO contractual order in the month of February already. And as Chai rman also said in the beginning, we are in discussions with several agroc hemical customers to commit that capacity to a couple of them. The diketene plant, the products coming out of tha t are advanced intermediates high-margin products, which go into pharma, paints and cosmetics segments. And there, we are already getting a lot of traction, an d that capacity, we are already getting good traction to fill up that capacity hope fully in the next couple of quarters itself. In fact, we are already thinking a bout how to debottleneck or expand that capacity. The plant, which is going to come up in the next f ew months is cosmetic grade Niacinamide and food grade Niacinamide plant, which is attractive to get commissioned in the month of September this year an d that will be targeting the high-grade, high-margin vitamin B3 segments in the cosmetics and food applications.

Got it. Sir, last question from my side. So, with c urrent added capacity in last 12 months, what is the revenue potential at current pr ices of product. So, we are operating at 60%, but obviously, the products that will come in the new plants are much better. So, what is the revenue potential with the current prevailing prices?

I think I already gave the answer Pranav, earlier. We are at Rs. 4,000 crores, Rs. 4,500 crores today. And I said on the back of t he capacity that we have put up in the last 2 years and what we'll be putting up in this year, we have full potential road map or visibility to at least Rs. 8,000 crores.

The next question comes from the line of Neerav J f rom Anvil Research. Please go ahead.

Thanks for the opportunity, sir. I have two questions. So, one is on the diketene part. Sir, since you have commissioned the derivati ves plant and plant is getting ramped up, what sort of value addition in terms of per kg or percentage realizations we can see over and above the base dik etene. And along with if you can just quantify the market of diketene and diketene derivatives in India.

So, I can't answer with precise numbers on the firs t one, but Neerav as you might already know from our previous calls, diketene is a n unstable molecule, so it cannot be sold as a stand-alone molecule. So, whate ver you sell in the market is on the back of value addition. And typically, now we have at least 5 products in our portfolio, which are derivatives of diketene. These are at least one or two steps ahead of diketene and now we are gradually adding more advanced stage der ivatives in the diketene portfolio, which will come up in Phase 3 and Phase 4, as I mentioned earlier. Sorry, what was your second question?

The markets for diketene and diketene derivatives in India?

Yes. So, I think overall, if you remember, the total market in India at least is 30,000 tons of diketene derivatives. One of our competitor s is already active there with about 40%, 50% share of that. Rest was enforced unt il a couple of years back. We have already taken significant share of rest of the market. And the bigger opportunity, by the way, in diketene derivatives is the exports. Because like our other core products, be it pyridine, anhydride or B 3, we are probably number 1 or number 2 and the lowest cost producer. Our aspirati on in diketene derivatives is also to be among the top 3 global players having a very competitive cost structure on the back of the plant that we have created, which has happened on the back of our own process engineering. So, we are very confid ent that as we scale up our diketene capacity and add more derivatives in Phase 3 and Phase 4 of diketene, we will not be able to take significant share of In dian market, but also of the global market.

Just to understand in slightly qualitatively, let's say, every step of value addition of diketene derivatives - let's say, you mentioned tha t we are now at 1 or 2 steps further, would be further value additions will happ en in Phase 2, Phase 3. What sort of percentage benefits we start getting on ove r and above the base diketene. Could it be 10%, 15%? Some understanding of some ra nging that would be helpful, sir.

So, I wish Neerav the world of chemicals was workin g that simply. Obviously, depending on how complex the reaction is -- what ar e the other chemicals which are getting added in each reaction, the quantum of value addition on each step will vary significantly. In fact, oftentimes, we - in recent years, we have encountered situations where if we go too far out in the value chain, the margin pr ofile actually drops because then you are sourcing something which is cheaply av ailable from China or elsewhere and hence, you get margin only for that o ne step, even if you are fully integrated. So, all kinds of permutations and combinations are feasible here. And hence even though diketene has, let's say, at least 30, 40 different derivatives, which we have mapped out. We are not t rying to make each and every one of them. For every derivative, we have do ne so far, we have picked up and what we have planned for Phase 3 and Phase 4, w e are doing a thorough assessment of what is the product, which applicatio ns it is going into, what is the level of complexity and value addition. And hence, what kind of margin profile we can get, and if it is not giving us at least 20% EB ITDA margins, then we are not prioritizing it. So, if there was value addition on every chemical, then we would have added like 50 derivatives by now, but that's not the case. So, you have to pick and choose based on several factors, which is what we are doin g as we pick up next phase of diketene derivative. And the same principle that ap plies for any value chain, I just took example of diketene because we were talking about it.

Got it. The second question is on the MPP part. So, one we commissioned last quarter, the bigger one, which is like 4x of the si ze, we commissioned in this quarter. So, let's say, once the MPP starts ramping up, what sort of asset turnover we should work with once it is fully ramped up? And generally, how much time it takes to ramp it up fully to realize its full potential?

So typically, for our Specialty Chemical business a nd MPPs fall in Specialty Chemicals, the asset turnover is about 1.5-1.6x. And then that - where I think most of the capex projects we have taken, we built out t he peak revenue potential of those product lines, which we plan to do in MPPs, all that adds up to 1.5x plus. Secondly, our experience has been in normal market s after the plant has been commissioned it takes at least 12 if not 18 months to get to 70%, 80% utilization level, which is what has happened with our Phase 1 diketene products, which, as I said, are running at 70%. It's, in fact, slightly d elayed, I would say because of the soft market. But the Phase 2 products which have co me up in February, for instance, we are hoping in the next 12 months, it will hit 70%, 80%.

Got it, sir. And just a last clarification. So does this MPPs used our pyridine chemistry as a starting material, which gives us a first more advantage in terms of the other suppliers with the same product to the sa me set of customers. How do you justify that?

So, Neerav, by definition, MPP can do multiple prod ucts. It doesn't have to be of redeem based chemistry products. In fact, most of o ur MPPs will be doing pyridine derivatives, diketene derivatives and even products outside of these 2 product platforms.

Got it. Sir, in and all, how many MPPs do we have n ow after the commissioning of the last one?

We have 7 fine chemical plants, MPPs. We have 2 GMPs in Bharuch. And we are in the process of putting up more MPPs, as I mentioned earlier. And in agrochemicals, sorry, I forgot to mention the 2 pla nts, agrochemical plants we have set up recently are MPPs as well.

Ladies and gentlemen, that would be our last questi on for today. I would now like to hand the conference over to the management for c losing comments. Over to you, sir.

Thank you all for joining on this call today. We ho pe we have been able to answer your queries. For further clarification, I would re quest you to contact me. And thank you, once again, for your interest in Jubilant Ingrevia Limited.

Thank you very much.

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

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