Capacit'e Infraprojects Limited — Call Transcript 2018

Aug 18, 2018

Ref : CIL/STEX 30/Q1FY19 : August 18, 2018 Date

To

The Secretary, BSE Limited Corporate Relation Dept, P.J. Towers, Dalal Street, Fort, Mumbai-400 001

The Secretary, National Stock Exchange of India Limited Plot No.C/1, G Block, Bandra Kurla Complex Bandra (East) Mumbai-400 051

Scrip Code /Scrip Id: 540710/CAPACITE

Scrip Symbol: CAPACITE

Dear Sir/Madam,

Sub: Transcript of the Analyst/ Investor Conference Call held on August 10, 2018

Dear Sir

We refer to our letter dated August 6, 2018 regarding the intimation of Analyst / Investor Conference Call on the Un-audited financial results of the Company for the quarter ended June 30, 2018, which was scheduled on Friday, August 10, 2018 at 4.00 P.M. (IST).

In this regard we herewith attached the transcript of the conference call as required under Regulation 30 read with Part A of Schedule III of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

This is for your information and records.

Yours Truly For CAPACIT'E INFRAPROJECTS LIMITED

Sai Kedar Katkar Company Secretary and Compliance Officer

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"Capacit'e Infraprojects Limited Q1 FY2019 Earnings Call"

August 10, 2018

SYSTEMATIX GROUP Investments Re-defined

ANALYST:

MR. JASPREET SINGH ARORA - SYSTEMATIX SHARES & STOCK LTD MS. DIVYATA DALAL - SYSTEMATIX SHARES & STOCK LTD

MANAGEMENT:

MR. ROHIT KATYAL - EXECUTIVE DIRECTOR & CHIEF FINANCIAL OFFICER - CAPACIT'E INFRAPROJECTS LIMITED MR. ALOK MEHROTRA - PRESIDENT (CORPORATE FINANCE) - CAPACIT'E INFRAPROJECTS LIMITED MR. DAMODAR AASH-HEAD (ACCOUNTS AND TAXATION) - CAPACIT'E INFRAPROJECTS LIMITED

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Moderator:

Ladies and gentlemen good day and welcome to the Q1 FY2019 Earnings Conference Call of Capacit'e Infraprojects Limited hosted by Systematix Shares & Stock Limited. 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 the guarantees of future performance and involve risks and uncertainties that are difficult to predict. As a reminder, all participant lines will be in the listen-only mode. There will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during this conference please signal an operator by pressing "*" then "0" on your touchtone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Jaspreet Singh Arora from Systematix Shares & Stock Limited. Thank you and over to you sir!

Jaspreet Singh Arora: Hi all. Good evening and welcome to the first quarter earnings call of Capacit'e. We have with us Mr. Rohit Katyal, the Executive Director & CFO, Mr. Alok Mehrotra, President (Corporate Finance), and Mr. Damodar Aash, Head (Accounts and Taxation). I hand over to Mr. Katyal for his opening remarks and then we will do Q&A. Over to you Sir!

Rohit Katyal: Good evening friends. A warm welcome to our Q1 FY2019 earnings conference call. I hope everyone has had an opportunity to look at our results. The presentation and press release have been uploaded on the stock exchanges and on our Company's website. Let me begin by giving you a brief update on the industry.

2018 has been a good year so far for the real estate sector. As per the recent report, the housing sales in India had surged 25% in the first half of 2018 with all the top seven cities showing a positive growth. Also, there has been a 45% year-on-year growth in the number of units launched during the first half of 2018 as per Knight Frank. Sales and launches have grown and are at the highest level since demonetisation. Mumbai witnessed 128% year-on-year growth in new launches the highest in India. Mumbai also recorded the largest sales volumes amongst all the cities. Capacit'e has a very strong presence in Mumbai and MMR area and our orderbook is reflective of this growth in this geography. Other geographies like Pune and Hyderabad also witnessed good growth in new launches. Again, Capacit'e has its footprints in these geographies as well. Apart from residential, commercial & institutional, retail space is also seeing an uptake in demand. There is a lot of traction in this space and we are very optimistic on these segments. Further the project pipelines of our clients give us enough confidence of healthy order inflows going forward.

Now coming to our operational performance during the quarter, let me start with the order book. In Q1 of FY2019 we witnessed record order wins from both Private and Public sectors. In the Private sector we added orders worth Rs.1,132 Crores. Q1 also marked our entry into the Public sector with our first EPC contract in an integrated

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association with Tata Projects Limited and CITIC. Our order book from the Private · sector at the end of June 30, 2018 stood at Rs.6,243 Crores net of taxes. Residential segment contributes 79% of the order book and commercial & institutional segment contributes 21%, high rise and super high-rise buildings account for 43% of the order book. The top five orders contribute 36% and the top five client groups contribute $\sim$ 55% of the order book.

Further, I would like to discuss about our order book movement here. The institutional and commercial segments composition in our order book has gradually increased from 2% in December FY2017 to 21% in Q1 FY2019. This reflects the increasing acceptability of our capabilities in non-residential sector amongst our clients. Our strategy continues in terms of order additions from reputed clientele having large value addition elements, which meet our internal guidelines and margins. The new order inflow from private sector during the quarter consists of $\sim$ 95% orders from existing clients or repeat orders. Key orders from the Private sector in Q1 included Wadhwa Wise City at Panvel, the order is worth Rs. 519 Crores, Sky City Mall form Oberoi valued at Rs. 272 Crores, again a repeat order from the Oberoi Group. Repeat order from Sheth Group for a total contract value of Rs.191 Crores and repeat order from Brookfield worth Rs.163 Crores.

About the Public sector order: During the quarter the consortium of Capacit'e along with Tata Projects Limited and CITIC has been awarded the Rs.11,744 Crores order for redevelopment of existing BDD residential and commercial societies (Chawls) at Worli. The project would be executed under an integrated SPV where the Company would hold a share of 37.1%. The construction of this project will be carried out in phases over a period of eight years. The project involves technical designing, coordination, and construction of rehabilitation, sale, commercial, and other structures. This is a pure EPC cash contract.

Moving on, I am happy to share with you that during the quarter the Company was conferred with The Golden Peacock Occupational Health and Safety Award for the year 2018. Golden Peacock Awards instituted by the Institute of Directors in 1991 are now regarded as a benchmark of corporate excellence worldwide.

With this I shall now share with you the financial highlights during the quarter. The Ministry of Corporate Affairs notified Ind-AS 115 applicable from the financial year beginning on or after April 1, 2018. In line with this the Company has implemented Ind-AS 115 with effect from April 1, 2018. There was a onetime impact of Rs.80 Lakhs on PBT due to necessary changes in accordance with Ind-AS 115. The total income from Q1 FY2019 was Rs.405.8 Crores as compared to Rs.271.0 Crores in Q1 FY2018 registering a growth of 49.7%. EBITDA for Q1 FY2019 was Rs.63.4 Crores as compared to Rs.48.4 Crores Q1 FY2018 growing by 31.2%. EBITDA margins stood at 15.6% for Q1 FY2019 as per Ind-AS 115 and at 16.2% as per the earlier standard Finance Cost as a percentage of total income has declined to 2.4% in Q1 FY2019 from

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3.5% in Q1 FY2018. Finance Cost for Q1 FY2019 is Rs.9.8 Crores as compared to Rs.9.5 Crores in Q1 FY2018 on absolute basis. The net finance Cost for Q1 FY2019 was Rs.3 Crores vis-à-vis Rs.7.6 Crores in Q1 FY2018. Depreciation for Q1 FY2019 stood at 18.5 Crores as compared to Rs.13.5 Crores in Q1 FY2018. The capex spent on core assets in Q1 FY2019 stood at Rs.9.9 Crores. The net core asset as on June 30, 2018 stands at Rs.310.2 Crores. The profit after the tax for Q1 FY2019 grew by 41.3% to Rs.22.7 Crores from Rs.16.1 Crores in Q1 FY2018. Cash PAt for Q1 FY2019 grew by 43.6% to Rs.44.1 Crores as compared to Rs.30.7 Crores in Q1 FY2018. The net working capital including retention money stood at 84 days during Q1 FY2019 as compared to 89 days for Q4 FY2018. The net working capital excluding retention money stood at 57 days during Q1 FY2019 as compared to 58 days for Q4 FY2018. With this, I now leave the floor open for questions. Thank you.

Moderator: Thank you very much. We will now begin the question and answer session. We have our first question from the line of Utsav Mehta from Ambit Capital. Please go ahead.

Utsav Mehta: Good afternoon Sir. Sir a couple of questions, just first I wanted a bit of update, I know you gave the overall receivables and the retention money number, but just wanted to understand what sort of reduction in receivables/working capital do you see through the year on the back of the GST, which I think it was Rs.100 Crores that was pending at the end of last quarter what is that number now?

Rohit Katyal: So, you have only June bills, which are submitted in July 2018, which are under certification. The figure, which was given last time pertained to March bills, which were submitted in April, which since then had been 100% certified. That is one, the second part is reduction in the debtors, so we have given you the number of days. We obviously are seeing reduction and as we had guided earlier we believe that during the current financial year we should be back at the previous numbers as were prevailing before implementation of GST.

Utsay Mehta: My second question was on the MHADA project, what sort of a capital deployment both in terms of working capital and fixed cost if any will we need to do in FY2019 and how much in FY2020?

Rohit Katyal: In both the years NIL. As I told you the project for the first year will be more on the designing part and doing the transit camp buildings, which will not entail any capex. In a year or two, you will start shifting and then demolishing the buildings, so we do not see any capex in year 1 and year 2 i.e. FY2019 or 20. Minuscule Rs.1 or 2 Crores cannot be ruled out, but any major capex is not envisaged in these two financial years. As far as working capital is concerned, it will be similar to the working capital, which we are currently having because it is a cash EPC and obviously it needs to be remembered that you have a 2% mobilisation advance, which is approximately Rs.230 to 235 Crores, so we do not see any shift from the current levels, which you have been seeing in the Company over the last three to four years.

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Utsay Mehta: I understood sir. Those were my questions. Thank you so much for your time. Moderator: Thank you. The next question is from the line of Anupam Gupta from IIFL. Please go ahead. On the margins during the quarter if I look at the margins excluding other income you Anupam Gupta: are at 13.9% on the reported number and if I include your adjustments under 115 you are at 14.4% versus 15.2% in FY2018 full year, first is what is the reason or are there any specific reasons for lower margins in this quarter and what is the outlook for the full year? Rohit Katyal: The full year outlook has already been guided between 15.7% to 16.3% and it should be obviously at the higher end of that. In the current quarter you have started four new projects, where costs has been expended but there are no sales, which have happened so this quarter-to-quarter variation as you have been seeing will happen, but on a whole year basis we will be maintaining EBITDA as per our guidance. Anupam Gupta: Within this is there any inflation or a significant inflation, which you are seeing on employee cost or labour cost specifically? Rohit Katyal: So, if you look at the impact, it is on the material cost, so if you look at the material construction expense it is 71.7% as on June 30, 2018, for the full year it was 71%, some increase is because of the Ind-AS 115 implication and 1% is because of the new projects, which have started up in this current period. On the other parameters if you see as a percentage the employee cost has gone down, which is a positive sign and a resultant of the economics of mass scale – which means as your revenue goes up, we do believe that there will be a fall in fixed costs. On the subcontractor cost, there is no difference, we are at the same percentage as in the previous quarter. Anupam Gupta: One small observation on the order inflow, which you have announced, we add up the four orders, which you indicated that was higher than the private sector order inflow, which you have indicated, so is there any cancellation or any adjustment? Rohit Katyal: No cancellation you have to reduce the GST. So individual orders, which you gave includes GST while in the order book you Anupam Gupta: removed the GST? Yes, because some are eligible for low cost housing benefits, so I did not have the Rohit Katyal: exact figure in front of me, the order backlog and the Rs. 1,100 odd Crores of inflow, which I just mentioned is net of GST and the order book client wise, which I have mentioned two of them were including GST. However, the net inflow stands at Rs. 1,100 plus Crores.

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Anupam Gupta:	Understand. Thank you.	ç,
Moderator:	Thank you. The next question is from the line of Aayushi Mohta from CD Equisearch.Please go ahead.
Aayushi Mohta:	Good evening sir. How different is it to work on a Government project compared to aPrivate one?
Rohit Katyal:	For us it is no different, this project includes design & build, which we are alreadydoing for the Private sector. The only difference that this will not be done by Capacit'eInfraprojects alone it will be an integrated joint venture arrangement with TataProjects. We have already started on the designing part of the project, so the executionmethodology or the way we execute the project will be no different whether it isPrivate or Government sector.
Aayushi Mohta:	Sir any difference in margins?
Rohit Katyal:	No, this is a design & build project, so the margins will be slightly better.
Aayushi Mohta:	How do you bid for these projects, like is there any difference in tender process of aPrivate project and a Government project?
Rohit Katyal:	So, in Private sector bidding is on invitation basis. In Government you havequalification criteria, this was a big project and obviously you see that stronger playershave been taken along to ensure that we qualify and since the project size was very bigthe competition also was limited to three or four players, which obviously includedsome foreign companies and from India there was Shapoorji and IL&FS. So, it is anopen tender and obviously once you are the lowest competitive biddertechnocomercially you are awarded the contract. This is the way it happens inGovernment. In Private sector it is more of a technical presentation and if you aretechnically qualified, you are allowed to submit your commercial bid. Then it isnegotiated, so it is more of a negotiation bid as against the L1 concept in Government.
Aayushi Mohta:	Sir given all things equal, which would you prefer executing commercial andinstitutional projects or residential?
Rohit Katyal:	Ours is a boutique building construction company, which includes residential,commercial institutional, hospitality, health care, now how much the share comes, itdepends on what the client's plan, there was paucity or lull in the commercial segmentover the last four years. Over the last one year now, we see the pickup happening andthat is reflected in the order book for us. We are comfortable executing all buildingprojects especially super high rise.
Aayushi Mohta:	Do we see the share increasing going ahead?

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Rohit Katyal:	As I told you, this is a dynamic situation, in the institutional buildings at the moment a 'lot of launches are happening so on a percentage bases it will increase, but housing isthe biggest business driver, on absolute bases that would take the share.
Aayushi Mohta:	Is there any lead developer in the government project, like there are three of you whoare executing this project, so is there any lead developer out of them?
Rohit Katyal:	There is no developer this is a pure EPC contract, it is a Cash EPC contract. We are theconstruction partners in the consortium of Tata Projects Limited, Capacit'eInfraprojects and CITIC, so there is no developer. Developer is MHADA, In theconsortium we are the technical leader and Tata are the commercial leader.
Aayushi Mohta:	You people are the technical leader in that?
Rohit Katyal:	That is right.
Aayushi Mohta:	Thank you so much Sir.
Moderator:	Thank you. The next question is from the line of Parvez Akhtar from Edelweiss. Pleasego ahead.
Parvez Akhtar:	Hi sir. Couple of book-keeping questions. Sir what would be our debt and the cashfigure at the end of Q1 FY2019?
Rohit Katyal:	Cash would be Rs.251 Crores, free cash I am talking about, free cash Rs.251 Crores,the total fixed deposit with bank in the system is Rs.320 Crores and the debt on grosslevel would be Rs. 230 Crores as compared to Rs. 238 Crores in March.
Parvez Akhtar:	Second thing, obviously our Q1 numbers have been really good, so how do we seethe rest of the year planning in terms of execution?
Rohit Katyal:	Generally, we do not give any projections, but we had during the last quarter concallmentioned that the order book is quite robust, we have some fast moving projectshappening, which is reflected in the sales growth and therefore we do believe that25% CAGR over the next two to three years is easily doable.
Parvez Akhtar:	Thanks a lot sir. That is it from my side and all the best for your future Sir.
Moderator:	Thank you. We have next question from the line of Karan Thakkar from PMSecurities. Please go ahead.
Karan Thakkar:	Good afternoon to Mr. Katyal and to the Management on the call. Two smallquestions, the first is as depreciation had gone up in the previous quarter we hadgiven a reason that any asset below Rs.30,000 is not being capitalised and becausecertain expenses for onsite developments were also expensed, so just to figure out

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the depreciation that we are reporting right now, is it expected to stay the same or can be taken in the light on the annual basis or are there any further changes, so how should we look at it from an annual basis?

Rohit Katyal: We have given a guidance of between Rs. 77 to 81 Crores for the full financial year. As far as last year was concerned, we gave the reasons that there was a change of depreciation policy, so that was a onetime impact of Rs.4 Crores additional depreciation in that quarter. You are seeing Rs.18 Crores odd in this quarter and therefore the overall year's projection of Rs.77 to 81 Crores stands. There is no change, the depreciation policies are well established and informed to everyone.

• Karan Thakkar: On the receivables side, last time as per the GST implementation you have mentioned that would reverse and that time we had some delayed negotiations with the clients, so as of now what is the status of that and what could be the receivables right now?
• Rohit Katyal: So during my opening remarks I mentioned that we have seen networking capital including retention money has come down to 84 days from 89 days as on March 31, 2018 so we have already reduced five days on an increased revenue and as I said sometime in May 2018 during our concall that over the next two quarters you will see this coming back to the pre GST levels, we are on track towards that.
• Karan Thakkar: Alright. Thanks. Sorry for the same question I have joined in a little later. Thank you.
• Moderator: Thank you. We have next question from the line of Alok Deora from IIFL Wealth. Please go ahead.

Alok Deora: I had two questions, one was on the capex, what is the capex guidance now for FY2019 and FY2020 considering the huge orders we have won of late?

Rohit Katyal: So, the capex budgeted and the approved stands at Rs.75 Crores for the current financial year and a similar level for the next financial year. This includes the orders, which the Company has won. Because if you see, capex in the Q1 is only Rs.9 Crores so obviously it will grow in the remainder quarters once the new projects tick in.

Alok Deora: Sir what would be the strategy in terms of bidding for new orders now considering that we have almost doubled the order book with the recent order wins, so what is the strategy now, will we be going a little selective on taking some projects, which are near the existing sites or something like that?

Rohit Katyal: We have maintained that if you look at the list in the private sector, all are repeat orders and we have six or seven main accounts who are contributing nearly 60% and

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above to this order book, which include Oberoi, Godrej, Wadhwa, which also includes our business association with Tata, so on and so forth. So, we do not change the strategy, we believe that our order book inherently as we see today has strength to increase in the private sector by Rs.2, 000 odd Crores going forward. So, the strategy would be to stick with the existing clients, add some more marquee or better clients over the next three quarters. On the overall order book having doubled we have to remember that the MHADA project has to be executed over eight-to nineyear period. So, at best you have to take Rs.300 Crores of revenue coming from that on yearly basis. If you take on absolute basis it will not give a true picture. So, whenever we speak quarter-on-quarter we will speak about MHADA separately and we will speak about the other order books separately. So, at best next year out of the Rs.4,200 Crores you may add a revenue of Rs.200 Crores and whatever revenue guidance we are giving are excluding MHADA and whatever you have done in the current year and you will achieve in the full financial year will be excluding MHADA. So, the 41% growth is not taking MHADA into account, okay, so ~Rs.6,200 Crores from Private sector is to be treated separately and MHADA to be treated separately.

Alok Deora: So, this MHDA project what have been a L1 sort of bidding project right, so are the margins going to be at similar range of 15% or there could be something lower than that considering the L1 projects the price competition might have come through?

Rohit Katval: So, it is not only the L1, which determines the pricing or the margins, it is also the value of the project, the complexity of the project, the project is a very big project and therefore the players were very limited, like what you see in the private sector. Secondly, this is a design-build project, so margins to the best of our understanding and the way we have quoted, we believe it will be slightly higher than what we are currently enjoying on an average.

Alok Deora: That is all from my side. Thank you and all the best.

Moderator: Thank you. The next question is from the line of Alisha Chhabra from Security Investment Management. Please go ahead.

Alisha Chhabra: My question is how much capex do we expect towards formwork?

Rohit Katyal: So, we have approximately Rs.75 Crores of budget for the current financial year of that an approximate figure of Rs.50 Crores has been set aside for formwork and balance for P&M.

Alisha Chhabra: Are you going to buy from MNCs or from the local players are they going to do this?

Rohit Katyal: So far it is only MNCs.

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Alisha Chhabra:	Thank you.
Moderator:	Thank you. We have the next question from the line of Vijay Gorr from First Global.Please go ahead.
Vijay Gorr:	Good evening Sir, congratulations on good set of numbers. I have a couple ofquestions, what has driven for a strong growth in Q1 FY2019 sir, which projects youhave executed or completed?
Rohit Katyal:	You have finished your question?
Vijay Gorr:	What has driven the strong growth in Q1 FY2019, which projects you have executedif you can?
Rohit Katyal:	So, we have nearly 56 operational projects, so all the projects are ongoing, andwhatever projects we added in Q4 of FY2018 the execution started in Q1 of FY2019and that has added to the growth because if you see that the order backlog as on Q4FY2018 was close to Rs.5,700 odd Crores. So, when you start executing theseprojects, more importantly Tata Trust Cancer Hospitals project in Varanasi saw verystrong execution because it is a very fast track project and you have to complete thatproject by December end or January 15, 2019 and you are on track to do that. Soobviously the execution at the site level results into numbers as far as revenue isconcerned.
Vijay Gorr:	Sir, second question is pro forma EBIDTA margin has declined so how do you say Ithink at somewhere volatility, so going forward in next quarter you are looking forbetter margins?
Rohit Katyal:	We have a guidance of 15.7% to 16.3% on yearly basis. EBIDTA margin on quarter-to-quarter basis do get impacted if you have five or six projects starting up like wehad in this quarter also. Secondly, this quarter you have onetime impact of Rs.80Lakhs on PBT level and Rs.10 Crores on the turnover level due to implementation ofInd-AS115. We have given in the presentation a clear cut bifurcation of the same, ifyou look as per the old accounting standards, the EBIDTA stands at 16.2% so if yourefer to that, the adjustment is clearly shown over there and therefore if theaccounting had happened as per the earlier standard the EBIDTA margin would be at16.2% so we believe that it is well above the lower bracket of our guidance, but forthe full year again we are guiding that it will be 15.7% to 16.3% and to the best ofour abilities on the higher end of that.
Vijay Gorr:	We have given sometime 25% order book execution guidance so this MHADAproject is executed from that, how much revenue you are expecting from thisMHADA project?

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Rohit Katyal:	Someone asked me a question about the growth, because of the strong order bookcompounded annual growth rate in the revenue that is what we mentioned. Secondpart of MHADA is the current year it will be only designing part, it is a big project,whatever revenue gets approved from designing that will be captured, but therevenue guidance for the current year does not include any revenue from MHADAwhatever gets added is bonus.
Vijay Gorr:	Thank you sir, thank you so much, all the best.
Moderator:	Thank you. We have next question from the line of Subramaniam Yadav fromSubhkam Ventures. Please go ahead.
Subramaniam Yadav:	Sir, I have missed the EBITDA margin guidance you have given, can you repeatthat?
Rohit Katyal:	The guidance is 15.7% to 16.3%. There is no change what we gave last year and forthe current financial year, so it will continue and we believe that for the full year itshould be 16% plus, but guidance will be 15.7% to 16.3%.
Subramaniam Yadav:	Gross debt you have mentioned is Rs. 230 odd Crores, right?
Rohit Katyal:	Rs. 230 Crores including bill discounting limits, yes.
Subramaniam Yadav:	Just wanted to understand on the interest cost what we have reported this quarterroughly around Rs.10 Crores, so how does that happen what is the cost of debt inthat case?
Rohit Katyal:	So, if you look at this Rs.9.8 Crores this includes bank guarantee commission, LCcommissions, interest on bill discounting and interest on cash credit limit. Theincome, which we make from the margins and FD with banks.
Subramaniam Yadav:	That is other income, right?
Rohit Katyal:	That is other income. So, this is a breakup of all these interests, which we paid.
Subramaniam Yadav:	Then what would be the cost of the debt then, interest cost for this?
Rohit Katyal:	The interest cost now currently is at about average 10.5% to 11%. It has come downfrom last year.
Subramaniam Yadav:	Still the interest cost would have been higher right?
Rohit Katyal:	No, the commissions would be higher because the revenue has gone up, theutilisation of bank guarantees and LCs have gone up you are ought to payscommission of which is included.

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Subramaniam Yadav:	That is what I am asking the interest cost what you have reported this quarter is onlyRs. 10 Crores?
Rohit Katyal:	That is the finance cost. Interest is a component of the finance cost, this will includeall aspects of financing, so that is what I said as your revenue grows your order bookgrows.
Subramaniam Yadav:	Right.
Rohit Katyal:	You would have more commissions payable on bank guarantees and LCs onabsolute basis.
Subramaniam Yadav:	Agreed, so full year what is the kind of interest?
Rohit Katyal:	Note it down. Rs.3.9 Crores on borrowing, bank guarantee commissions are atRs.1.5 Crores and other charges, LC discount charges, bank charges are at Rs.4.28Crores.
Subramaniam Yadav:	Sir for full year what would be the interest rate can you guide us?
Rohit Katyal:	Multiply the quarterly figure by four.
Subramaniam Yadav:	Thank you Sir.
Moderator:	Thank you. As there are no further questions, I now hand the floor to Ms. DivyataDalal from Systematix Shares & Stock Limited. Please go ahead.
Divyata Dalal:	Thank you Sir. On behalf of Systematix I would like to thank Capacit'e Managementfor giving us an opportunity to host the call and thank you participants for loggingin. Over to you sir for closing remarks.
Rohit Katyal:	Thank you very much for participating on our concall. We look forward to interactwith you in the next quarter.
Moderator:	Thank you. On behalf of Systematix Shares & Stock Limited that concludes thisconference. Thank you for joining us. You may now disconnect your lines.