Pennar Industries Limited (513228) Earnings Call Transcript

Ladies and gentlemen, good day, and welcome to the Q3 and 9 months FY '21 earnings conference Call of Pennar Industries Limited, hosted by PhillipCapital (India) Pvt. Ltd. This conference call may contain forward-looking statements about the company, which are based on the beliefs, opinions and expectations of the company as on the date of this call. These statements are not guarantees of future performance and involve risks and uncertainties that are difficult to predict. [Operator Instructions] I now hand the conference over to Mr. Vikram Suryavanshi from PhillipCapital (India) Pvt. Ltd. Thank you, and over to you, sir.

Thank you, Margaret. Good morning, and very warm welcome to everyone. Thank you for being on the call of Pennar Industries Limited. We're happy to have with us management of Pennar Industries here today for question-and-answer session with the investment community. The management is represented by Mr. Aditya Rao, Vice Chairman and Managing Director; Mr. Shrikant Bhakkad, VP, Finance; Mr. J. Krishna Prasad, CFO; Mr. Manoj, Head Corporate Affairs; and K. M. Sunil. Before we get started with the question-and-answer session, we will have some opening comments from the management. Over to you, sir.

Thank you, Vikram. This is Aditya, and I wish a good morning to all the stakeholders of Pennar Industries and thank you for attending the third quarter for the financial year 2021 conference call. I hope all of you are safe and are taking all necessary precautions during this pandemic. The structure of the conference call will be the following. I will first provide an overview and my comments on the third quarter performance. Our CFO will then provide details on major financial metrics. Post this initial summary, we will take calls from our stakeholders. Firstly, we will start with an overview of performance. Quarter 3 saw further improvement in our revenue compared to quarter 2 of the current fiscal. We recorded net sales of INR 412 crores in Q3 compared to INR 390 crores in Q2. In Q2, we had recorded a marginal profit as we recovered from the lockdown that is imposed and the attendant issues with the addressable market. We have substantially grown our profitability in this quarter with a net PBT of around INR 3.42 crores and a cash profit of INR 16.17 crores. As mentioned in the previous conference calls, our updates going forward on our investor conference calls will be broken into 3 parts: profitability, liquidity and growth. On profitability, we have re-achieved profitability at Pennar, and our focus is now on re-achieving our pre-pandemic profitability and cash profit. Post that, our goal will be to start generating growth quarter-on-quarter compared to the pre-pandemic quarters. We are now confident in projecting that in quarter 4, we will re-achieve our pre-pandemic PBT, PAT and cash PAT on a monthly and on a quarterly basis. Coming to liquidity. We are also hard at work to bring down our working capital usage in terms of number of days of revenue. We had discussed reaching working capital usage of about INR 420 crores, while growing revenue on our last call, and I'm happy to note that we have achieved this. We are at INR 421 crores. We continue to work on revenue growth, and we will reachieve our pre-pandemic revenue in this quarter. However, we continue to work on reduction of working capital usage in terms of number of days. So our current target is to get to 75 days cash-to-cash cycle. We are currently at around 100 days on that, too. The reduction on account receivable, inventories and -- as well as working with our vendors and suppliers, we intend to achieve a cash-to-cash cycle of 75 days by the end of the first quarter of the next financial year. Coming to growth. We have continued to invest in our growth opportunities in the third quarter, specifically our BIW plant in Chennai, our ICD capacity expansions in Chennai, metal buildings plant in Tennessee in the U.S. and our tubes IOR sales in the U.S. All of these investments will bear fruit in the current quarter and in Q1 of the next financial year. And we believe that they will allow us to substantially grow our PBT, PAT and cash PAT. We expect to commission CapEx of around INR 75 crores in this financial year as we had mentioned on our last call. Our current addressable markets also continue to show a lot of recovery. Most of our revenue streams will have returned to their pre-pandemic status in this quarter, which is the fourth quarter, with the exception of our PEBS, railways and environment revenue streams. The railway vertical's outlook is currently unclear, and I should be able to give a better idea of the way forward for this in the next quarter. PEBS environment vertical will return to pre-pandemic profitability in Q1 of the next financial year. As I mentioned the last time, we believe that the combination of these 2 initiatives, recapturing our addressable markets over the next few months and investments into new addressable markets will allow us to exceed our pre-pandemic monthly revenue and profitability before Q1 of the next financial year, and we are well on track to achieve that. Coming to -- we do not give guidance, but what we have started over the last 2 quarters is to give a broad idea of where we are headed for the current quarter. In that, you are let to note that in Q3, we had achieved 70% of our pre-pandemic cash PAT. Pre-pandemic cash PAT being defined as the PAT less depreciation less any deferred tax in Q3 because Q4 onwards, obviously, the pandemic had started, the lockdowns have already been initiated. So we generated around INR 16.1 crores of cash in Q3 before tax, and the corresponding Q3 for the previous financial year was around INR 23 crores. At this point, the management would like to state that we are likely to achieve 100% of our pre-pandemic PBT, PAT and cash PAT very soon. The reference quarter we're using, as I had mentioned, is the third quarter of the financial year 2020. As for the fourth quarter onwards, the pandemic and the lockdown in India had commenced. In conclusion, I would like to reiterate that what we had committed on our last call that we are confident that we are well placed to regain our profitability levels, improve our working capital and ensure growth in the next financial year is well on track. On that note, I will hand the call over to financial controllers, Mr. Shrikant Bhakkad and Mr. Krishna Prasad, for their brief on the third quarter performance.

Good morning to all the stakeholders. The consolidated financial highlights for the Q3 FY 2021. The net revenue, we were at INR 412 crores compared to net revenue of INR 390 crores in Q2, which is up by close to 5.5%. In terms of EBITDA, we are at INR 37.53 crores in the current quarter versus INR 32.67 crores in the Q2 of FY '21, which is up by close to around 15% from the last quarter. PAT after the minority interest is INR 2.57 crore compared to PAT after minority interest at INR 0.24 crore. So even if the increase in the revenue of net percent of 5%, but overall, the PAT has increased by close to around 10x. In terms of consolidated financial highlights for the 9 months, it is -- net revenue-wise, we are at INR 968 crores versus INR 1,655 crores in the last 9 months. In terms of EBITDA, we are at INR 57 crores versus INR 158 crores. Overall, in terms of the highlights, the Ascent Buildings LLC, which we have as a wholly owned subsidiary of Pennar Global INC, would invest close to around USD 4.9 million for setting up a PEB plant in U.S.A. This we have briefed in the last quarter that we are setting up the subsidiary. Now we have decided to invest, and the total investment would be USD 4.9 million. Pennar Industries has a healthy order book position through this quarter. And the order book position as on 31st of Jan or 1st of February is -- PEBS has close to around INR 434 crores in terms of order book, Enviro division has INR 46 crores and Railway division has INR 200 crores. So these are the broad business highlights in terms of the financial performance. Now I hand it over to the moderator for the question-and-answer session.

[Operator Instructions] The first question is from the line of [ Dilip Sahu ], an individual investor.

My question is regarding the Ascent investment, what would be the asset turn in this business and profitability? And as per your press release, you will be -- you'll get into production, commercial production by first quarter of next year, which looks like a very, very short time from getting into the project to getting to production. So can you just throw some light on this? That's question number one. Question number two, we had some big write-offs of bad debts in last 2 years. Is it over? Or is there something pending on what kind of write-offs we are looking in this year and next? That's the second question. And the third question is obvious, the third question is about the cost of raw material. And we have got a huge building -- fabricated building order book, how is the current rise in steel prices going to impact both building and railways order book?

Thank you. I will answer the questions one by one. So Ascent Building systems is a step down wholly owned subsidiary of PGI, which is a wholly owned subsidiary of Pennar Industries. The asset turns, which you speak of, the total capital we will be deploying is about $4.9 million in that company. And we expect a first year revenue internally of a certain number, but what the CEO of that business was a veteran in that field in the U.S. has committed to us and what we have already started generating an order book gives us the ability to say that we are expecting around $15 million. So an asset flip of about x4 is what I would guide you to. But do keep in mind that we -- I consider this to be a conservative estimate. I believe we will be able to improve substantially on this. But at a minimum, 4 in terms of revenue flip. In terms of commissioning of the plant, the question you had was that it was a fast turnover. There are a couple of reasons for that. One is that we bought the building, which is the factory building, which -- it was previously a metal building plant, which was not being used. So we have bought that. So we did not need to make the building or do the civil works. So what we needed to do was to install the equipment and make sure that all the attendant required equipment in terms of material handling, cranes, movement were all installed. So that has resulted in the total CapEx. And also that the plant gets commissioned very, very quickly. So as you said -- as you have said, in fact, also, that we expect the commissioning of this plant to be in the first quarter of the financial year. And we already have an order book of close to about $4 million to $5 million on this. We have a very good team over there. They're very enthused about getting ongoing -- getting up and running. And I think we are quite comfortable saying that this business is going to start contributing to our revenue and profitability well in the next financial year itself. The next question you had was on write-offs. We do not -- by write-offs, we mean that if there's any accounts receivable, which was not collectible or if there's any inventory or current asset, which is either an obsolescence for that current asset or any other kind of write-off. At this point, we don't expect anything specific. We constantly measure the quality of our current assets, and we don't currently have any concerns on that. These are independently assessed externally. So nothing to share on that point that there will be any massive. However, we do constantly provision quarter-on-quarter for a certain percentage. Consider it a historical assessment of illiquidity in accounts receivable or inventory. So we provision for that. So we'll continue to make provisions, but that's obviously not the same thing as write-offs. As of right now, I have no substantial write-offs, which would be material to the company to communicate at this point. The last question you had was on steel prices and the cost of raw materials impact on our order books in PEB and in railways. We have made sure that any steel price increase, which is -- and it's still pretty massive, as you have noted, 70% in the last 3 to 4 months. We have ensured that margins are protected. We did have an issue in the third quarter, where some of the revenue we had to go back on because the rapid steel price increase predicated that we were not able to cover the raw material. I can assure you any order that will -- that is booked at a price, we try to cover the raw material costs through our relationship with JSW and Tatas and other steel providers. If for whatever reason that is not possible, we will give up that order book. As of right now, the order book for both PEBS, for Enviro and our railways business are at our standard margins. There is no difference. Wherever -- and for any orders, where we've not been able to cover, we've gone back to our customers and asked for a price negotiation or a price variance clause. So all of that has been done. So at this point, we have no order book right now, or the average order book margin contributions, which we monitor every month, had not decreased by any measure compared to the previous quarters. Does that answer your question, sir?

Yes, yes. Can I ask one more question or should I come back on the queue?

You can go ahead sir.

Yes. So I was listening to the Tube Investments' con call, where they talked about certain concern in the railways business in terms of execution because of COVID and also the uncertainty regarding order book. So do you -- railways is a profitable business for us and it's fairly substantial in the order book. So what is your comment on railways in general for next 2 to 3 quarters?

I would share the concerns expressed by TI on Railways. While we have -- currently have a reasonably strong order book, and yes, Railways as a business unit is still profitable and has good profit margins, we are unable right now to give you clarity on what's going to happen in the next 1 quarter also because there is a dramatic drop in offtake from our major railways customers, which include ICF, which include MCF and others as well. So at this point, we are not able to comment more than saying that it will continue to be a profitable vertical. However, to give you a really clear picture of what we expect for the next financial year, we will have to wait. I will probably have to give you that clarity because right now, we do not possess that clarity. It could go in a couple of different directions. So I think the most proper course of action is for us to withhold comment on that from our side until there's clarity for us, so then we can communicate that clarity to you. Of course, I would like to state that all of the comments we have made in terms of our profitability, what we're going to achieve in this quarter, specifically reachieving a pre-pandemic profitability in terms of PBT and cash PAT, we will absolutely -- we have taken that into account, taken the current railways situation into account before committing that. And we are quite confident of the commitments we have made on the call today. But yes railways right now, I'm unable to give you clarity. I share the concerns that TI would have mentioned on their call. It's very, very, very vague right now.

[Operator Instructions] The next question is from the line of [ Vijay Kumar ], an individual investor.

Hello? Are you able to hear me?

Yes, sir. Go ahead, Vijay.

I would like to get some comments about your outlook on interest cost. We have been always guiding towards 3 to 3.5 percentage of turnover, especially when most of them are current assets. But for the long-term period, we think we were not able to see that proportional at 3.5%. Now we are almost crossing 5%. So where are we headed? Is there any balance sheet actions? How are you planning to get this debt in control, interest payment in control? Can you throw some light, please?

Thank you for your question, Vijay, important question. Shrikant will answer this question.

Vijay-ji, we are taking a number -- multiple steps here in order to reduce the working capital usage, which is a little high. And as we said at the beginning of the call, presently, the working capital is close to around 100 days. And whatever the receivables that we have and the inventory that we have, we have been reviewing each inventory and the -- that is part of it. Since I'm aligned to see that, we can collect more in terms of receivables. And wherever there are nonmoving inventories and nonreceivables, we are making those provisions as well in the books. The interest cost is presently high because of certain pre-pandemic whatever the debtors that we have are still going to complete. There are a lot of sites, which are stuck at the -- where the monies are stuck. So those are retention monies, which we have tactically in the projects in terms of PEB and Pennar Enviro. So as and when those monies come back and flow back into the company, this cost will reduce. You are right, we had challenges here in terms of overall interest cost being higher, but we are making sure that interest cost reduces as and when our addressable market and the revenue grows. This is also because the net interest to net sales percentage is also presently high because of the lower net sales cost. While the debt has also reduced, it is not significantly reduced in terms of what we have. The finance cost has reduced close to around 5.5%, 6%, while the revenue overall has reduced by 40% when you compare period-on-period. So these are the differences why we have -- and as we increase our revenue, we would not again have the additional finance costs, which will come back. Those will have the working capital movement, we will not have that kind of -- again in place. So your question is right, we are presently little high interest to net sales percentage. And then we will ensure that this comes on. Give us 1 -- a couple of more quarters, I guess, and I think we will be fine.

You will -- to add on to that, Vijay-ji, I think you will see the 5% come back down to 3% in the next couple of quarters, as Shrikant has said. And you will see substantial improvement in the next quarter, in the fourth quarter itself. But the challenge has been the higher working capital we are carrying in terms of number of days is directly resulting in a higher interest cost. Also when a lot of the newer revenue streams and they get commissioned as well, and they are also at a working capital, which is in line with our, as I said, our cash-to-cash cycle, that, too, tends to moderate the entire -- our entire working capital and around that correspondingly is our interest cost as a percentage of net sales. So we expect by this 5% to improve dramatically over the next couple of quarters and in fact, in this quarter itself.

The next question is from the line of Venkat Subramanian from Organic Capital.

In the minutes of our Board meeting, we seem to have taken an approval to actually put one of our businesses on low priority and probably actually exit. Can you throw some light in terms of what the thinking is here?

We're not actually exiting any businesses. So are you referring to the Oneworks sales?

It -- I probably got a sense that it's one of our BPO engineering design kind of business. There were some brief measures.

So Oneworks was a company we acquired in the last -- in the financial year 2020. They are in the field of BIM, which is Building Information Modeling. We have managed even through the pandemic time to scale that revenue up. But what we have done is transferred the customers, the contracts that we had from that business to the regular company. And since we have done that, it doesn't make sense for us to continue operating the wholly owned subsidiary because there's no -- all the revenue is now being booked in Pennar Industries. So it doesn't make us -- make any sense for us to continue to operate a subsidiary with no revenue. The BIM revenue now exists in Pennar Industries.

It's a very scalable business, right? I mean that's something that we can probably grow manyfold from there, right?

Absolutely. So we are not exiting that business at all. We expect to grow that business further, but that will be on the back of organic growth now or even if it's in organic, it will be to other entities. What you are mentioning in terms of us exiting, there is a company which we acquired, which is a wholly owned sub. We have transferred the business to the main company. Now we would like to -- there is no point operating a separate business with governance or other issues. So it's no revenue, no operations company, which we are now like to put.

Understood. I would like to take you back to something that we discussed maybe about a couple of quarters ago, which was on the large write-off that we took about 12 months ago. And you said you didn't agree with your auditors and that there could be substantial recoveries, but we haven't seen that. Are we overestimating? Where do we stand on both the inventory and receivables?

Could you repeat the last part of your question, sir? You said a large write-off about a couple of years ago. And what did you say after that?

Not even a couple of years ago, I think it was last year. And we said that was something that you probably had to do because the auditors actually opined another -- in a certain way, which was -- and you were more confident about the recoverability of all that. But we haven't seen that, right? That has not played out, right?

So the asset, what you may be talking about, maybe our HDO related -- NPCIL-related revenue streams. Those remain active as of right now, and we have a pretty strong accounts receivable. So whatever corrections we have taken at that point of time, once those amounts are collected and the projects are closed, we will be able to get that back on to the balance sheet. And we still expect that to happen. However, because of the pandemic period, there's been a lot of slowdown in these projects -- in these -- shall we say the projects, which are from NPCIL and others as well. So once those come in, we'll be able to take them. But as of right now, the AR for that, I wouldn't call it write-off, all is provisioning on that. We still retain the ability, and we are very confident that we will be collecting that amount. There is no write-off or heavy write-off that we are anticipating in our current accounts receivable or on our inventory.

Sure. Without going into specifics, I think if you go beyond the current quarter, what kind of visibility do we have? For instance, a lot of other engineering companies are talking about possibly the China Plus One factor actually playing out. We are probably seeing some -- a lot of activity on the ground. Doesn't that augur very well for our building solutions? And what kind of -- what's your outlook on the next couple of years?

I think China Plus One has resulted in some revenue growth for us, especially in our industrial components division. And I think that will persist. I think there's definitely groundswell of opportunity there, which we are absolutely trying to improve and grow on. In fact, our entire BIW investments can be thought of as an extension of -- resulting because of that -- because of the current situation. However, when we make capital investments, we will keep in mind the long-term future of any business and not any short- or medium-term imperatives that may drive it. Now I do -- a lot of people feel this is something that's permanent, and I would agree with them also in some sense. But the capital investments we are making and our current assets, our current revenue-generating assets and our businesses are well placed to weather and to grow over the next 10 years. So we don't invest in any business unless we see that business will exist 10 years from now. So short-term, medium-term investments, no matter how attractive it may look on paper, we are not going to be making. So consequently, if you look at our current revenue streams, which include our automotive fields, Railways fields, our building -- preengineered building construction fields and their environment fields, we believe people will need water treatment 10 years from now. We believe people will make buildings 10 years from now. We believe that people will drive -- there will be a powerful auto sector 10 years from now, which will -- it will move to electric, but that's the reason why we are also moving to electric in our new investments, and there will be a rail sector as well. So the last thing I would add is on the energy front on solar as well, we believe solar is here to stay. We are previously well only in the field of solar MMS. So we were not quite happy with what that field was achieving. But with our current value proposition, with our current revenue-generating assets, solar also will continue to be big opportunities for us. So in all of these 5 verticals, automotive, railways, building construction, environment and energy, we are very confident that we will have good addressable markets over the next -- I can't say over the next 6 months, 1 year, that will definitely grow because we're coming off such a low base in the last year because of the pandemic and the lockdown and the effect that has had on our addressable markets. But we are quite confident that the investments we have and the investments we have made, the assets we have and what we're going to procure are going to put us in a good place to improve our addressable markets. And if our addressable markets increase, our revenue and profitability will also increase. So we're quite confident. I mean Q1 was bad; Q2 was profitable; Q3, more higher profit; Q4, absolutely substantially much higher profit. And next year, of course, with all of our assets coming online, and hopefully, some resolution of the pandemic and lockdown, we currently are very, very optimistic. We would project a very good year next year. And that story should continue as we continue on our growth path.

[Operator Instructions] The next question is from the line of Parin Jhaveri from JNJ Holdings.

I just have 1 question. In terms of our order book, which according to the slide, is about INR 680 crores and in which, as per your statement, you are seeing some dip or some delay in the railway part. So if I just look, it's about 30-, 35-day order book kind of a number. So can you just throw some light on this? And how do you look going forward?

So the order book of INR 600 crores, as I mentioned, does indeed include our Railways business, our rail -- PEB, Enviro and railways. And you are right in that, as I said on an answer to a previous question, Railways' revenue is volatile. It is not 0, it's volatile. It's set up -- it's somewhere between 30%, 40% of what it was pre-pandemic. That being said, order books represent only about 40% of our revenue. A lot of our revenue is scheduled revenue. A lot of our revenue is, for example, for the automotive sector, we make a lot of automotive component. It's just scheduled orders. We don't function an order book on that. Order book specifically affects or is active only in the PEBS, environment and the Railways business. Consequently, we are -- we don't believe that this Railways reduction in any way affects our revenue. And it is not, as you have said, 35 days. In fact, in most of our verticals there, which are order book based, for example, PEBS having INR 434 crores of our order book right now. We have foreseeability for the next 10 months. For environment -- Enviro business, we have foreseeability for the next 4 or 5 months. Railways business, we have a large order book, but we don't expect that to translate to revenue at the same clip that it has historically been. So the issues that I outlined in Railways, firstly, will not -- we have taken that into account when we are projecting revenue growth for fourth quarter and very substantial profit growth for the fourth quarter. Secondly, the -- since the majority of our revenue is scheduled orders and not order book-based, the entire order book and that been taken as 35, 40 days, would give you an inaccurate picture of our revenue foreseeability and revenue safety nets right now.

What would FY '22 look like in terms of top line? If you can just guide us and on the EBITDA margin?

I can assure it will be much higher than FY '21. Beyond that, we are -- we have completed our budgeting exercise. Our Board has to sign off on that budget. Once that is done, I will definitely come back with a far more accurate idea. But at this point, I guess, you can say it's going to be much higher than FY '21. But what I can say is quarter-on-quarter growth will continue. That I can. So Q4 was -- as I said, Q2 was better than Q1, obviously. Q3 was better than Q2. Q4 is better than Q3, substantially. And Q1 will also be better than Q4, that we can more or less comment.

The next question is from the line of Vikram Suryavanshi from PhillipCapital.

Basically, can you give some more details about the tube business in terms of where we are in capacity utilization or compared to pre-pandemic, where we have reached in terms of revenue? And for tubes, within that, how is the breakup for ERW and CDW as well as the opportunities in export? So just a more clarity on tubes business.

Understood, sir. So the tubes vertical currently executes about INR 20 crores in net sales per month. The majority of that is ERW. The CDW sales would be about INR 6 crores to INR 7 crores. From a pure capacity utilization point of view, our ERW plants are at capacity. CDW, we are at -- increasing our capacity utilization, especially with our tubes IOR revenue streams in the U.S. increasing, which we will supply partially, if not entirely from here, from India. So right now our capacity utilization in tubes is close to -- as a blended capacity, it's about 60%. But if you look to only at CDW, it's probably closer to 50%. So we will try to bring that up over the next few quarters. And as you're I'm sure aware, CDW is a more profitable vertical. So that's good news from a revenue and profit growth point of view that we are looking at higher sales. In fact, in the last month itself, we have improved our exports of CDW from -- substantially from selling about $200,000 per month. We are now greater than $300,000. We expect we'll reach about $600,000, about INR 4 crores to INR 5 crores per month. So exports itself reaches that, that, plus the domestic market combined, should take our tubes business' revenue and profitability up higher. But we are quite optimistic that tubes will do well in this quarter and going forward.

And in future, will we look at opportunities to -- from tubes to go to the higher size like pipes and all that in metals or tubes will be -- itself will be a big opportunity for us?

We have a large diameter project. We had kept it on hold considering the pandemic. We will -- we are in discussions with our -- with the business unit head of that vertical. And I will get back to you on when we will, but we do have plans to do that. And at some point of time, we have to do it. Now is that in this current fiscal? No, we will not be commissioning that CapEx or spending -- investing capital in that. Whether we're doing it next year or not, I'll come back to you once we've completed our internal discussions.

Okay. And as a bookkeeping question, what is current gross debt and cash level on the balance sheet? And second, the INR 75 crores export this year. But now we are seeing our revenue is picking up towards a more pre-pandemic level and growth is coming back for almost all the segments. Are there CapEx plans finalized for the next year? Or will the large part of -- basically, I want to understand that the free cash flow, will it be invested again in growth? Or how is the plan for the deleveraging?

Regarding the debt, I will hand over to Shrikant and J.P. for their comments. And I will answer the CapEx question after that.

Yes. In terms of the total debt, the term loan what we have -- what had INR 154 crores as at March and that term loan has now reduced to INR 140 crores. So it is close to around INR 14 crores overall decrease in terms of term loans. In terms of borrowings, we were at net -- if you see the net -- the borrowings, including the rebuilds, we were at INR 366 crores. Now it is INR 349 crores. So in terms of borrowings also, there have been a decrease but not as much as you would have expected during this. So overall, our debt has come down from INR 520 crores to INR 490 crores. This is the total overall debt numbers.

Thank you. Regarding the CapEx, what I would want to state is as you said, we are finalizing our budget, we will have numbers to share soon on that. But as of right now, we are going to continue with INR 75 crores. And right now, as I mentioned on the call, in Q3, we generated about INR 16 crores of cash before tax. So we expect that to climb substantially in this quarter. So we don't -- we will not be raising additional levels of debt to finance these things. So as much as possible, we're going to -- vast majority of our CapEx will be through our internal approvals. So accordingly, the use of our cash that we generate will be as a feedback to ensure that we increase our cash generation capacity, which means revenue-generating asset, which means revenue. So the INR 75 crores will be funded to internal -- and we have funded that through internal as well in this financial year. So yes, next year's plan, we'll come back to you, sir.

Sure. And just moving back to question queue, if you can give cash balance on balance sheet and that's from my side.

Yes. one second. Total cash, we have close to around INR 22 crores in terms of the amount that we have and the investments in mutual fund are a level close around INR 18 crores. So total INR 38 crores is what we have as at December.

The next question is from the line of [ Venudhar G ], an individual investor.