Nath Biogene India Ltd. — Call Transcript 2020

Jun 19, 2020

19th June 2020

The Manager-Listing The Manager-Listing Dalal Street, Bandra (E) Mumbai-400001 Mumbai-40005 1

BSE Limited National Stock Exchange of India Ltd., Phiroze Jeejeebhoy Towers, Exchange Plaza, Bandra-Kurla Complex

BSE Code-537291 NSE Code-NATHBIOGEN

Subject- Transcript of Conference Call with the Investors/Analysts.

Dear Sir/Madam,

The Company had organized a conference call with the Investors/Analysts on Tuesday 16% June, 2020 post declaration of its Audited Standalone Financial Results for the quarter and financial year ended 31st March 2020. A copy of transcript of conference call held with Investors/ Analysts is enclosed herewith and the same being uploaded on Company's website.

We request you to please take the above on record

Thanking You

For Nath Bio-Genes (India) Limited

Devinder Khurana Chief Financial Officer

= Nath House, Nath Road, Aurangabad - 431005 (MS) Tel : 0240-2376314/5/6/7 NATH Email : info@nathseeds.com www.nathbiogenes.com = 1, Chateau Windsor, 86 Veer Nariman Road, Churchgate, Mumbai - 400020 (MS) Tel : 022-22871001, 22875653/4/5 EROUP

Transcript

Conference Call Nath Bio Genes India Ltd. Q4FY20 Earnings

Event Date / Time	:	16th June 2020, 11:00 AM IST
Event Duration	:	1 hour 10 min 58 seconds
Presentation Session

Pavitra: Good morning ladies and gentlemen! I am Pavitra, moderator for the conference call. Welcome to Nath Bio Genes India Limited Q4 FY 20 earnings conference call. At this moment all participants are in listen-only mode. Later, we will conduct a question and answer session. At that time if you have a question, please press STAR and 1 on your telephone key-pad. Please note this conference is recorded. I would now like to handover the floor to Ms. Sheetal Khanduja from Go India Advisors. Thank you and over to you ma'am.

Sheetal Khanduja: Thank you Pavitra! Good morning everyone! Welcome to the Nath Bio Genes Limited's earnings call to discuss Q4 and FY 20 results. We have on the call with us today Mr. Satish Kagliwal, MD of the company, Mr. Devinder Khurana, CFO and Mr. Madhav Dhande, Head of Marketing. We must remind you that the discussion on today's call may include certain forward looking statements and must be therefore viewed in conjunction with the risk the company faces. May I now request Mr. Kagliwal to take us through the company's business outlook. Thank you and over to you sir!

Satish Kagliwal: Thank you Sheetal! Good morning ladies and gentlemen! I am to begin by bringing your attention to a tiny seed. On the surface, one seed may seem absolutely insignificant, yet in a finite tiny seed there is infinite capacity to grow. And, we at Nath Bio Genes are in the business enhancing potential of that particular seed further through breeding excellence and bio-tech interventions. I would like to thank you all for taking your time for this annual results call. As we face this global pandemic, I hope you and your loved ones are safe and healthy. We are in the seed business for 40 years now, but never has our vision been more relevant. When this pandemic hit, we were at the beginning of the Kharif season. Preparations for Kharif season were just beginning. We had to ensure that our farmers had all the necessary support and material to ensure a successful sowing season, thereby ensuring our nation's food security. We received all the necessary help from the government and our dedicated workers worked very hard to ensure our seeds reached all the farmers in time. We also had to ensure safety and well-being of our employees who were our very own COVID 19 warriors. We ensured our workers stayed in factory premises where all safety protocols were followed. We took measures to provide them comfortable and safe accommodation. It is only because of these efforts that farmers received their seeds at this crucial and difficult period. Progress and prosperity of our farmers form the very core of our company objectives. It is an important goal that drives

our agriculture business, particularly our R & D. Over the last 4 decades we have seen struggles of farmers with low crop productivity and crop infestation that reduces their true potential. We have invested in creating world class R & D facilities and have some of the best industry experts managing our research. Complementing their efforts is a team of incomparable experts in finance, marketing, supply-chain and distribution. Each of these critical departments are headed by industry veterans with diverse and multi-decade experience. Friends, the pandemic is still unabated and there is a huge uncertainty about the revival of the economy. However, one sector which will do extremely well is agriculture. Agriculture has the potential to act as a catalyst and ensuring a quicker turnaround of our economy. Everybody is looking at agriculture to help our economy. At Nath, we continue to provide our farmers with top end products to ensure their financial well-being. Our R & D teams are working tirelessly and we recently launched 2 new cotton products which ranked highly in ICAR trials. Indian Council of Agricultural Research trials. Testament to our progress is the fact that we have launched 12 new vegetable hybrids in 5 different crops during last 6 months. There are many more such products in our pipeline. We are confident that our efforts are in the right direction. And this will take our company to a higher growth trajectory soon, thereby benefiting all our stakeholders. I would like to express my gratitude to all our stakeholders who have given us immense support and stood by us all along. Nath Bio Genes has proven to be a crisis proof investment. Despite the challenging environment we have delivered excellent results. I now handoever to Mr. Khurana, who will discuss these results more in details. Over to you Mr. Khurana.

Devinder Khurana: Thank you sir! Good afternoon ladies and gentlemen. I am sure you would have seen our result presentation which has been uploaded on exchanges and the website. As Mr. Kagliwal mentioned, the pandemic hit us at a very crucial time. It was end of Rabi but beginning of Kharif for this year. Despite a very challenging environment, we have delivered a very good set of results and we have met our FY 20 guidance. I will now briefly discuss the key financial and operational highlights for the last year. We achieve highest ever top line of 280 crore this year, which is an increase of over 21%. We were able to maintain our gross margins to 52-53% plus, and the EBIDTA margins also moved to around 20%. As we move to a higher growth trajectory and our products gain more market share, we have been able to improve our working capital cycle also. The working capital cycle reduced by over 30 days and we continue to plan to reduce it further. Consequently, we have also started generating positive operational cash-flows. The company generated a positive operating cash-flow of around 10 crores plus in FY 20. The debtor collection period reduced by 36 days to 140. We aim to prune it further to 120 days over the period of time. We continue to remain a long term debt free company despite our strong growth. In product mix, paddy continues to be our main grocer with 32%, closely followed by cotton with 30%, vegetable including Win-Chi-Win around 21%, with other crops contributing the balance. Ironically, Bajra turned out to be the dark-horse in the last year, almost doubling from last year's sales of 6.68 crores to 12.17 crores this year. We have good plans

for Bajra also. Wheat was also one of the jumping crop. It jumped almost 50%, although from 4 to 6 crores, we plan to have a wheat growth of around 35% per annum. Coming to certain detailed assessment, our strong financial performance was driven by a strong operating performance. And now I would discuss some operational highlights. We took multiple steps to ensure that we had minimal impact of COVID for the ensuing Kharif 2020. We secured permission from the government authorities to operate our plants 24 X 7 across the country. Our staff was accommodated at factory premises to avoid unnecessary travel and all necessary precautions were taken to ensure seamless working. As a result, we avoided disruption of processing and logistics on account of COVID and we were able to place around 16 + lakh cotton packages in the market. At this point I would like to mention that we have one of the lowest sales return in industry in FY20. And hence, we have very good visibility of expected revenues from our cotton business. Cotton continues to be the key growth driver and registered 46% volumetric growth. Our seeds are steadily gaining market share, their superior yield and strong resistance to pest makes it a preferred choice for the farmers. This year also we launched two new cotton seed products. Like earlier year, out products continue to perform extremely well in ICAR trials. The marketing and distribution teams have ensured that seeds are now available pan India. We are confident that these seeds will further drive our market share in the years to come. The vegetables and paddy segments also registered a strong volumetric growth of 56% and 32%. We sold our 4000 quintal vegetables against a target of 3500 quintals. Similarly, we sold paddy of 74000 quintals against a target of 60000 quintals. In both these segments we continue to gain the market share. Our plant nutrient segment was marginally impacted by the lockdown and we sold 51000 liters against a target of 55000 liters. We are aggressively working up towards ramping up sales for these segments for coming years. With the acquisition of Genetic Modernization and Research facility we have consolidated our business under one roof. This would pave way for expansion and growth in the coming years. Overall, it was an eventful year, and given our strong performance over Rabi and the way things are currently progressing, I am confident that we will be able to deliver you 20% plus up line growth in financial year 21 and we will continue to maintain a strong gross margin of 50% plus. With this, I would like to open the floor for questions. Thank you!

Pavitra: Thank you sir. Ladies and gentlemen, we will now begin the question and answer session. If you have question, please press STAR and 1 on your telephone key-pad and wait for your turn to ask the question. If you would like to withdraw your request, you may do so by pressing STAR and 1 again. I repeat, ladies and gentlemen, if you have question, please press STAR and 1 on your telephone key-pad. Please note that STAR, 1 should be pressed only one time. Pressing multiple times would put you out of the queue. We have first question from Mr. Rahul Veera from Abakkus Structural. Please go ahead sir.

Rahul Veera: Hi sir.

Devinder Khurana:	Yeah, morning!
Rahul Veera:	Sir, hope all well on your end.
Devinder Khurana:	Yeah, everywhere. Don't worry. We are good.

Rahul Veera: Just wanted to understand what are the expectations in terms of crop retention from the farmers in this Kharif season in terms of larger crops, cotton or rice. You know, if there could be large churns in terms of crop sowing patterns?

Devinder Khurana: I would request Mr. Dhande to address this please.

Madhav Dhande: Yes. Rahul, good morning! This year arrival of monsoon is very timely as compared to last 4-5 years. And so far as the seeds are concerned, the acreages under pulses and particularly the oil seeds, mostly the groundnut, it has gone very high. Cotton remains static. In some of the states it has dropped in some it has gained, but it is static. But has not gone down less than 120 lakh acres. Paddy is the grown phenomenal in the north eastern parts because of shifting of labour and other things. And in some parts like Gujarat where paddy is not a major crop but Paddy is (inaudible 13.10) because of the labour problem. Overall growth in Paddy and Bajra and oil seed is fantastic. Overall, cotton is static. Rahul Veera: Ok. Ok. Sir, fair point. Thank you!

Madhav Dhande: Thank you!

Pavitra: Thank you sir. We have next question from Mr. Nitin Awasthi from East India Securities. Please go ahead sir.

Nitin Awasthi: Hello sir! And this I had a few question and I would like to understand, wherein the export opportunity in the company; the company has time and again mentioned that they are looking for exports. Now, over here, what I would like to understand is, many countries in Africa and also our neighbours like you know, Bangladesh are flourishing with a lot of BT crops. Like in Bangladesh in particular BT Brinjal, and Africa in particular, they have opened up for genetically modified chick-pea and mug beans. So, although these are not legally allowed to be sold in India, can a company in India work on this technology, develop these seeds and export to those countries? That would be my first question sir.

Devinder Khurana: We will take your questions one by one, Nitin. So far as exports are concerned, I would request Mr. Kagliwal to address this question.

Satish Kagliwal: There is no ban on doing research in India. We can do research in India and always export from India to other countries. Issue is, it becomes very difficult for research here, and do test and trials in other countries because it becomes difficult, right? So, like I think most of the companies are ready

with the BT Brinjal in the factory here. Even we are ready with the BT Brinjal as far as our company is concerned. But we can always take our products to the other countries. But, what happens is that it becomes challenging to do so. And better to concentrate on what is sure shot solution rather than for uncertainties like other countries. So, the answer is, we can do research in India and take the result outside.

Nitin Awasthi: Ok sir. Got it. And sir, the second question would be, a lot of farmers in India, there is a lot of news going around that they are resisting the ban on your version 3 of the hybrid cotton seeds – BT 3. And although banned in India, they are getting seeds from somewhere, and they are sowing it and challenging the government that we going ahead and sowing it. So, if the government tomorrow allows the seed to be legal, how much time will it take for the company to ramp up and be ready with that product?

Satish Kagliwal: Dhande sahib..

Madhav Dhande: Ha, it will take its own time. Minimum time required is (inaudible 16.11) Minimum it will take 2.5 years to come out with such an approved version or may be not approved version. Because, what we said that the government may revamp this process. If revamp this process, even the corporate houses (inaudible 16.28) and harvest the brinjal.

Nitin Awasthi: Ok sir. Got it. Thank you so much for answering my questions.

Pavitra: Thank you sir. Ladies and gentlemen, if you have question, please press STAR and 1 on your telephone key-pad. Please note that STAR, 1 should be pressed only once. Doing so multiple times would put you out of queue. We have next question from Mr. Aniruddha Joshi from ICICI Securities. Please go ahead.

Aniruddha Joshi: Yeah, hello sir. Thanks for the opportunity. So, basically sir, we had almost 9 odd million packets of seeds in FY 19. And I guess now our target is to reach around 17 odd million packets for 21. So, one thing is that overall cotton seed market itself is not a growing market. So, where are we getting the growth? Are we gaining market share from somebody? So, are we gaining market share from any particular player? And also, how much more scope is there to gain market share? And lastly, in that can you indicate which are the States we are gaining the market share?

Devinder Khurana: Dhande sahib, please..

Madhav Dhande: Yes. So, Mr. Joshi, a very nice question. Because the cotton market is static, almost 450 lakh packets, i.e. 4.5 crores roughly. It is static. We share it is static. Now, there are two segments which is attracting the attention

of farmers, one is the big boll and another is sucking pest tolerant. These are two choices. Either we grow cotton with the big boll and cotton with the sucking pest. But in industry it is a reciprocal combination. If it is a big boll then naturally it will be susceptible to sucking pest conflict. So, few of the companies are with the big boll, they are enjoying the giant market share. We are the only company, I can say with pride or one or two products might be there in the market, those which are medium boll but having a high level of sucking pest tolerance. So, we are creating in that segment space. Particularly (inaudible 18.49) segment or the (inaudible 18.52) segment where the farmer would like to have a second crop after cotton, not the perennial crop like cotton and cotton and cotton only. First they will harvest the cotton and they will go for the big boll. And that space is very big, particularly we are getting that kind of share particularly from Maharashtra, Saurashtra i.e. Gujarat because Gujarat farmers depends on. Certainly we are not getting that much share from Madhya Pradesh. Then Andhra Pradesh, because in Andhra Pradesh most of the lands are the rains land and light rain. Then Karnataka. And there we are growing. And of course at present our market share is too small. When our market share is small, it is always easy to grow irrespective of market share will grow or not. So, that is another fact of life.

Aniruddha Joshi: Ok. Ok., Hello…Yeah, in terms of… what will be the roughly market share in this cotton seed market? Who would be… let's say, if you can give market share of key players, so we know that Kaveri is the leader over there. But then who would be the other players? Indicative market share if you can help with.

Madhav Dhande: In fact, I am telling you sir, that right now the situation has arose in such a way that Rasi is a giant, big giant in cotton. And might be enjoying almost 20% + market share.

Aniruddha Joshi:	Rasi has 20% market share? Ok.
Madhav Dhande:last 3 years.	Yes, yes. And they are the market leaders since 3 years,

Aniruddha Joshi: (Inaudible 20.31)

Madhav Dhande: … of course Kaveri is there, then Nuziveedu is there then Mahyco is there, so many companies… But I will tell you that there is a big between number 1, number 2 and number 3, number 4.

Aniruddha Joshi: Ok. So, there are various smaller players also from whom we can continue to gain market share? That is possible for us?

Madhav Dhande: This year we observed a phenomenal change in the market. Smaller were not getting the space. Particularly. Yes. That might be because they could not distribute in the market. Or the inter-district boundaries

could be the restrictions. Smaller players appear to be disappeared from the market.

Aniruddha Joshi: Ok (Inaudible 21.23) Smaller players are relatively more impacted.

Madhav Dhande: Yes, more, yes.

Aniruddha Joshi: Ok. In terms of sir, royalty is gone in this cotton seed business, so how do we see the technology part moving over here now? And means, now what is the role of Monsanto left in this entire business now… Now how do we source the royalty or how do we get the entire… help to create the GM seeds?

Devinder Khurana: Mr. Kagliwal, would like to answer this, or shall I

Satish Kagliwal: Yes. Very interesting question, very pertinent question from Monsanto's point of view. Actually now, there is absolute limbo as far as new technologies are concerned. There is no new technology on which companies are working. We are working and several other Indian companies are working to bring new technologies. So, as far as existing technologies are concerned, Monsanto will not get royalty. But as and when new technologies – 3rd generation, 4th generation, I would say higher tolerance to boll worm complex as well as other (inaudible 22.54), etc. So, as and when they will come in, they will bring change into the market, ok? So, this phenomenon will continue. There is little lag, a little lag because government policy is not very favourable to new technologies coming in. But as they will come, there are several companies that are working on the same and we are also working very aggressively on the same on new technologies. OK?

Aniruddha Joshi: Ok. And sir, the last question. Is the margin expected to improve in the cotton seeds? Do you see cost of doing business come down due to low competition or with all this reduction in royalty and etc.? Everything, do you see scope to improve the margin in cottonseed business?

Devinder Khurana: Let me answer you that. We have been maintaining gross margin of around 52% which will continue to be maintained over next 2-3 years. Royalty which we are all talking about is only 20 rupees. So, it doesn't make much dent in our margins and the cost of production is constantly going up. As far as cotton is concerned, the government has put a cap on the top-line, the sale price. So, as for cotton margins are grossly slowly reducing.

Aniruddha Joshi: Ok

Devinder Khurana: So, to cover that our company has moved into vegetable hybrid paddy which has somewhat better margins, around 60% plus. Vegetables

give me 60% plus, Win-chi-win gives me 70% plus. So, we continue to maintain our product mix in such a way that our gross margins continue to remain around 50 to 54 % irrespective of gross in one crop or the other.

Aniruddha Joshi:	Ok
Devinder Khurana:	Ok. Next question please.
Aniruddha Joshi:	Sure sir. Thank you!
Devinder Khurana:	So

Pavitra: Thank you sir. We have next question from Mr. Jay Arora from Birchwood Capital. Please go ahead.

Jay Arora: Hello sir! Thank you for giving me this opportunity. I have 2-3 questions, sir. First is, if I go to the presentation, page no. 3. We have shown Paddy volume has increased by 32% but in terms of revenue growth it is showing only 8%. In terms of unit wise हमारा óयादा Ǒदख रहा है पर revenue के अंदर इतना sir 8% growth...

Devinder Khurana: Yeah. That is basically because when we show Paddy, we show as a mix of hybrid and OP. OP sells at 20-30-40 rupees a kg. Because the volume of OP don't give you kind of margin the hybrid Paddy will give.

Jay Arora: Ok. Ok.

Devinder Khurana: So, as a result… that's why I answered the last gentleman we are also contemplating adding onto hybrid Paddy for which our Research and Development in Andhra Pradesh under the able guidance of Dr. Ish Kumar is trying to create wonder products for hybrid products – maybe in a year or two. Once that comes through then you will find a stupendous growth in Paddy volumes also. I am sorry, value also.

Jay Arora: Perfect. Ok. Sir, my second question is relating to selling and distribution cost. At present it is around 20% of our revenue. So, just wanted to know if it is relatively more in comparison to industry standards industry के अंदर

it remains, selling and distribution remains so high? Or we have just recruited more people for the sake of growth so relatively it looks a bigger percentage, or has a major share in expenses?

Devinder Khurana: We gave a trade cost of around 12% only to the customers. Customers means the dealers and distributors. That has gone up from 11% of last year because when we want to grow, then we get more people with more incentives so that your volumetric growth also get converted to top-line, right?

So as far as selling and distribution cost is concerned, we have also moved in vegetable vertical and now we are in process of moving in Win-chi-win PNS vertical. So, this is going to have an additional burden on our expenses but it will automatically get converted into better sales in the coming years. So, what we are doing is well augmented and well lined up. No tension on that.

Jay Arora: Ok. Perfect and the last question is because of the revaluation of few assets of our company, our return ratios ROE has suffered. So, for last 2-3 years I have discussed about this company with various investors and in financial market people look at this scenario, this particular few return ratios. So, was just wondering if there is a way, how much time do you think it will take of our ROEs of few financial ratios to improve?

Devinder Khurana: Umm… Two things, let me answer both of them simultaneously. One is that re-valuation had happened not because we were interested. But it was imposed by the government under Ind AS. The land and the assets were supposed to be given at the fair market price, so they were given at the fair market price. Ironically, this gives me a fantastic network. Now, your question is, because the network has enhanced to almost about 200 crores +, which is the actually the fact on ground because we are sitting on the land back on that value. Ok? But now you would say the return on capital employed is reduced, ironically because of the enhancement of the networks. My request to the analyst lobby is, when you carry out, or when you calculate my return of capital employed, I would request you to please remove that re-valued or fair market land value and find out; and you will find that we are jumping in a beautiful fashion.

Jay Arora: Perfect. That's it. Thank you very much. This answers all my questions.

Pavitra: Thank you sir. Next question we have from Mr. Bharat Gupta Edelweiss. Please go ahead.

Bharat Gupta: Hello sir! Congratulations for good set of numbers. I have just one question, which is in regard with the liquidity position amongst the farmers. Sir, we have seen that the government has procured at a higher pace for the upcoming… Rabi season. But whereas at the same time there has been some kind of financial impact because of the lockdown related to farmers who were having overdependence on cash crops. So, how are you assessing the situation currently?

Devinder Khurana: You see, the liquidity has taken a beating over say, last March, April, May. The reason was that the farmers were unable to lock up their Rabi crops, so they didn't have the funds lined up. But the lockdown also put everybody at home, so we did not know what was going to happen. The company was contemplating putting the goods into the market hoping that the lockdown will ease out, because the monsoon was expected on time. And as a result if monsoon

would hit and the farming community comes out at large and our products are placed, we would have suffered. Now that issue is closed. We are in the market. The farmers are coming out. The farmers have to put goods on time, liquidity has been a concern, but now that things have started improving. Our cash-flow also took a beating in the month of March. But now we are coming back and we understand that farmers are also coming out with the funds, and the distributors and the dealers at the local level are also supporting these people.

Bharat Gupta: Sure sir. That's it from mine.

Pavitra: Thank you sir. We have next question from Mr. Viraj Kacharia from Securities Investment Management. Please go ahead.

Viraj Kacharia:	Hello?

Devinder Khurana: Yeah Viraj.

Viraj Kacharia: Hi sir! Thanks for the opportunity and congratulations for a good set of number. I just have 3 questions. First is, you know, you talked about small and medium players facing risks in terms of, you know, in this particular market, in this particular season. My question is, largely, if you look at the guys, they are looking at this year, in terms of accelerating the consolidation in the industry in the form of either using the extended credit, terms or doling out higher interest rates. So, for us, do we see the need to kind of match them to achieve our growth guidance or… you know, how should one look you know, the working capital cycle this year? And, just to add to that you know, are we seeing any pressure in terms of say right-off in terms of on the inventory or receivables? Because you know, there has always been a risk in this industry… So, yeah.

Devinder Khurana: Ok. Firstly, like I said, our working capital cycle did improve and we are operating… we are generating operating cash-flows. That was good for the company. You were asking me whether we will be matching the industry? Definitely we have to match the industry because we cannot be our sole crusader running our own game. So, definitely we will be doling out whatever the other is doling out, to ensure the top line. If you see that our sales expenses, our schemes expenses are slowly inching upward that is to ensure top line and ensure products are sold on time. If we need additional working capital, I can always fall back on my bankers because we are, not even just have around 70 crores of limit vis-à-vis 300 crores of top line now. As far as write-offs are concerned, in inventory, we always inventory at a values, we always cost in such a way that if there is something that is not to be carried forward to the next year, we knock it off in the same year. We do not entertain writing off inventory as a whole on year to year… on a continuous basis. As far as debtors is concerned, we maintain a provision of debtors which are inoperative for more than 3 years, and then we go legal and try and get them back. So, I do not expect any major write-offs in debtors or inventory

in this year. I do expect the selling cost to go up. And we have to maintain that along with other people. The working capital cycle will be under control.

Viraj Kacharia: Ok. But are we seeing aggression in the market place already by the larger guys? And what are we seeing in the market place? And typically one would understand with the… I mean, my question is are we already seeing any aggression in the market place by the large guys, larger competitor? And you know, typically one would understand that you know, the Rabi season being so good and the outlook for the Kharif being equally good. So, placing the placement of material in the market and, you know, would be at much better terms. But, you know, what we are seeing in the... this time in the season is completely different. So, just trying to understand this a bit better.

Devinder Khurana: Yeah, so what has happened is the entire marketing teams of all the companies are in the market today. The season comes with a very, very small window when the rain sets in and people lift the material and go, and at that particular time our boys should be active enough to ensure that our material is lifted, although the product calls for itself. But the aggression in all the companies at this juncture is same. If others are aggressive, so are we. It's a matter of competition, let's see.

Viraj Kacharia: Ok. And second question was on the…you know, so you talked about us probably looking to monetize land (inaudible 34.46) to fund the CAPEX. What kind of CAPEX program you are looking for next 3 years? If you can provide…

Devinder Khurana: Firstly, I have never made a statement in any of the systems that we are trying to monetize the land for CAPEX.

Viraj Kacharia: Sir, it is in the presentation. That's where I was referring from.

Devinder Khurana: No, then I think there must be something.. we are not… we don't do much of CAPEX, please understand, as a company. Our processing plants and godown are available at rental basis. We find it better to keep them like that. If you see my balance sheet over last 5-7 years, the only CAPEX would be either acquisition of a land for research at our Research & Development station or some vehicle here and there. Our cash-flows and accruals are sufficient enough to give me whatever minimal CAPEX I need. As a company we are not going to make any major dent into CAPEXes.

Viraj Kacharia: Ok. And any thoughts on the monetization of land bank? If we have any…

Devinder Khurana: No, it is not required. We have sufficient funds. We are very well off, we are keeping land bank for any day which we don't expect as far as we are concerned.

Viraj Kacharia: Ok. Fine. And if I can squeeze in one more question, we acquired this company… this portfolio from the Global Transgenes seeds now. The portfolio which they have the cotton seeds, the fusion seeds portfolio and typically, if you look at India it is largely a BT cotton market and we tried with the fusion approach first but we didn't met much success. So what is the whole idea with buying you know at…

Devinder Khurana: Global Transgenes seeds has been our genetic research company. Right last 2 years we haven't contemplating rolling out that system into Nath Bio Gene India Limited. They have been very actively moving into international areas like Philippines, Myanmar, Azerbaijan including Sudan where fusion BT has been tested, is being tested, has been tested and is accepted and will be accepted. So, as a result, picking up that line was important for that company because now I will solely entering into international trade also as far as fusion BT is concerned. And there will be no cross questions between the two companies. So, this was the promise which we had made to the investor community about year and a half back that we will bring the whole thing under one roof. We have given that promise fulfilled and the whole thing comes under my (inaudible 37.19).

Viraj Kacharia: And any timeline by which we expect this approvals in Philippines and elsewhere to materialize?

Devinder Khurana: There is a slide on the page of exports, if you are able to see on that, as far as Philippines is concerned, we are already through but the government is dragging its feet. As far as Sudan and Myanmar is concerned, we are into the large scale trials this year. And hopefully if that goes well the next year we will be going commercial. Azerbaijan, is still in the nursing stage, adolescent stage and it is going to take 2-3 years more.

Viraj Kacharia: Ok, fine. That's all from my side. Thank you very much.

Pavitra: Thank you sir. Participants are kindly requested to restrict with two questions in the initial round and join back the queue for further questions. We have next question from Mr. Rohit Nagraj from Sunidhi Securities. Please go ahead sir.

Rohit Nagraj:numbers.	Thanks for the opportunity and congrats for this set of
Pavitra:	Sorry to interrupt, Mr. Rohit…
Devinder Khurana:	Louder please.
Pavitra:	Your voice is little low sir.

Rohit Nagraj: Just a minute. Hello.

Devinder Khurana: Yeah Rohit…

Rohit Nagraj: Thanks for the opportunity and congrats for this set of numbers. And hope everyone is safe and sound. Just a few questions, one is regarding last couple of month's performance. So, have we faced any kind of issues to supply-chain, logistics or any other kind of issues because of which maybe the placement of our products has hampered to any extent?

Devinder Khurana: Yeah I did cover it, what it was that COVID hit sometime in the end of March. So in March whatever additional sales we could have expected from Win-chi-win or other crops actually went down. But it did not affect my overall top line of last year. We were good. As far as this year is concerned, for Kharif I said we have taken permission from the government, we had put people in the factory. We had made our production and processing and logistic line online. And we have already been able to place sufficient material in the market. I think if the farmers pick up the good and they sow in time, we should not be having issues, as far as COVID is concerned, at least for Kharif.

Rohit Nagraj: Ok. That is good to hear. And on cotton packet royalty, the 20 rupees royalty which is abolished, so, have we reduced our product selling price or the product selling price remains same and 20 rupees will add to our margins?

Devinder Khurana: The cotton top line, the cotton price is made fixed by the government. (Inaudible 39.57) 20 rupees less, you know. (Inaudible 40.01)

Yeah, so we keep the royalty and if need be we pass on to the trade.

Rohit Nagraj: Ok. Ok. And sir, in terms of the cost, we understand that in last one, one and a half year we have appointed people at business level and head level and plus we have appointed a lot of sales and marketing staff. So, in FY21 do we expect the staff cost or the sales staff cost extend substantially? Devinder Khurana: Yeah, we expect the staff cost to go up around 15%. Let us say around 10% on account of increment and 5% for additional people. But you expect me to make a CAGR of 20% plus on top line, my expenses on staff are bound to increase, otherwise who will sell?

Rohit Nagraj: Correct, correct. And in this purchase of fixed assets on the intangible front, of 12 crores, is it related to acquisition from Transgene?

Devinder Khurana: Yeah, that was exactly the point which I was discussing in the last question. It was acquisition of Transgene only.

Rohit Nagraj:	Right sir. And sir, if possible, can you just give
---------------	----------------------------------------------------	--

Pavitra: Sorry to interrupt,

Rohit Nagraj: Ok, I will come back in the queue.

Pavitra: Thank you! We have next question from Mr. Deepak Kohle from B and K securities. Please go ahead sir.

Deepak Kohle: Yeah, thank for this opportunity. Sir, you have mentioned that the cotton acerages remain stagnant but if you look at the Telangana government has asked the farmers to go for the cotton crop for this year and this could significantly increase the acerage which is in Tenagana. Sir, how do you see the scenario and whether the company is going to benefit from that?

Devinder Khurana: Dhande sahib, please…

Madhav Dhande: Yes, yes. In fact it is a good move from the Andhra Government. Of course it will take some time to be imbibed by the farmers. No doubt they are recommending cotton and red gram as mixed crop. So, as such we are thinking… and they are banning the maize crop. Maize they are no allowing, and they are allowing Paddy to grow. Fine paddy, but Andhra being cultivated with fine rice only, so no question. So, rice is increasing, pulses are increasing, cotton will remain static. Means, we have not yet seen spurt in the seed demand due to incremental acerages in cotton. Right now, we have not seen it. Of course it is not rained well. It has rained in certain districts, it has not rained in certain districts. 40% season is over, but we didn't find any much of spurt in the demand. Of course, if there is an increase in demand, the company will get benefit out of it.

Deepak Kohle: Ok. Ok. My next question is, sir, how do you see this recent announcement by the Finance Minister and how it is going to help the farmers? So, that is my second question.

Madhav Dhande: Particularly, Telangana government did a lot for the farmers. For every season they are getting 5000 rupees as assistance to the farmers for seeds and other things. So, naturally farmers will oblige also. And as such, maize is not a very big crop in Andhra Pradesh and that is why people will follow them. That is not a problem, and it is a good move rather. What is to grow there and how much to grow. So, I think this needed at all India level, not only in Andhra Pradesh. And, it is going to benefit the industry.

Deepak Kohle: Ok sir. And on the announcement of the Finance Minister, sorry… so, if you look at sir… my last question is that can you give some colour on the vegetables and paddy segments and what are our market share position? And target states? That is from my side, thank you!

Madhav Dhande: MD sir would like to handle that?

Satish Kagliwal: I couldn't get your name. You are Sudhir, right?

Deepak Kohle: No sir, my name is Deepak, from B & K Securities.

Satish Kagliwal: Ok. The vegetable market, if you look at our market share, we are just beginners. So, market share are very insignificant. What is happening at the vegetable segment is that farmers are moving rapidly from varieties to hybrids. And hybrid segment has much clearer advantage in terms of productivity, in terms of price. So, our market share, if the question is market share, the market share is very small at the moment and we are rapidly growing and maybe we can talk about market share at the end of this year, current year. And paddy, about paddy, our… in case of paddy also there is a big move from the public varieties to selection varieties, different varieties. The big move. And we are moving into some select segments like long boll segment, short and fine segment and we are making big dent. Not only we, every company is moving into that direction. I would say a big jump is seen in this segment, in case of selection varieties.

Devinder Khurana: I would like to add here, in vegetables, we have installed a separate vegetable vertical for vegetable seed growth. So, we are setting up a separate vegetable marketing team. We already had research, production and processing people but we are setting up a vegetable marketing team and we expect their vegetable along with Win-chi-win giving about 30-35% growth every year. That should help the top line and the bottom line both, because they come with good margins.

Deepak Kohle: Yes sir. Thank you, thank you very much sir!

Devinder Khurana: Next please.

Pavitra: Thank you sir! We have next question from Mr. Ajay Kataria from New leaf Advisors. Please go ahead. Next question from Mr. Ajay Kataria from New leaf Advisors. Please go ahead sir. Looks like the participant's line is not active.

Devinder Khurana: Yeah, he is offline. Take the next one please.

Pavitra: Yeah! We have next question from Mr. Jatin K from Alpha Capital. Please go ahead sir.

Jatin K: Hello sir! Congrats for good results in this tough season. Sir, my first question would be… hello.. Am I audible?

Pavitra: Yes sir, please go ahead sir.

Jatin K: Yes sir, my question… first question would be, for cotton for this season you said the area under cultivation is kind of flat, so in terms of which regions we will be growing and which regions you think it is down?

Devinder Khurana: Dhsande sahib, please.

Madhav Dhande: Yes, yes. Particularly the acreages are dropping down in Gujarat then Madhya Pradesh and Karnataka. It has remained static in north. But it has dropped in Rajasthan. Acreages which remain static or may gain little bit in Maharashtra. And may grow by 10% in Andhra Pradesh. Overall impact will be static.

Jatin K: Ok. That's' good to know. And sir, in terms of other products like paddy, etc. how do we see this area in… under coverage for the country as a whole and in terms of state wise, which state will…

Madhav Dhande: Paddy, of course paddy is a very routine kind of crop where paddy is being grown, it is grown. Now where paddy is being grown not as a traditional crop, it is grown as extensive management crop. And paddy acreage year on year are growing. This year also in north eastern part because of the timely monsoon paddy acreages will grow. Paddy acreages are so big, almost 4 times of the cotton. So, to get the assessment how much it has increased and all other things, it will take certain time.

(Inaudible 48.25)

Paddy is a big crop in India. Yes.

Jatin K: Ok. Ok. Thank you sir, and my last question would be on tax rate. Our taxes are kind of low and what is the guidance on that front?

Devinder Khurana: Yeah, please understand we are an agriculture industry and we treat our income as an agriculture income and so, taxes are nil. Yet, on trading income, if we sell PNS or it is our vegetable which we procure and not produce, and then we sell it, I treat it as trading income for which on pro-rata basis we put the expenses and the balance becomes taxable. So, last year also we paid MAT of around 1.52 crores and this year also around 2.5 crores. The taxes are ok as far as agricultural income is concerned.

Jatin K: Sure. That's it from my side and all the best for the next season.

Pavitra: Thank you sir! We have next question from Bharat Shah from ASK Investment. Please go ahead.

Bharat Shah: Wanted you to give a long term view on each of your key portfolio (inaudible 49.40), so

Devinder Khurana:	Bharat sahib can you make it louder?
Bharat Shah:	Is this better now?
Pavitra:	Yes.
Devinder Khurana:	अभी ठȤक है भरतभाई अभी ठȤक है।

Bharat Shah: I wanted you to analyze the prospects of each of the different seeds portfolios that you have, in terms of long term opportunities, (inaudible 50.11) preparedness and strength in each of those areas. And then, of course there is a volatility on year to year basis in terms of season and other factors. But on a long term basis where do you see yourself placed; in terms of growth in each of these segments?

Devinder Khurana: I think this is a strategy question, I would request Mr. Kagliwal to address and answer this.

Satish Kagliwal: Mr. Bharatbhai, very interesting, very deep strategic question. We have our own business plans laid down for next 3 years for sure. We see ourselves in cotton. But we would like to have only a part of the total business plan dedicated to cotton. We see a lot of growth in paddy, both in paddy hybrid segment as well as research segment. Besides that we see good growth in Bajra, wheat and mustard. Ok, as far as field crops are concerned, we are expecting growth in future. In Bajra hybrid paddy, research paddy and wheat. In vegetables we see a fantastic growth in next few years' time because this market is growing rapidly. Vegetable section is growing faster than the field crop section, right? So, we are expecting good growth planning good growth in vegetables section. And if you see our guidelines for next 2 to 3 years' time, we are having a very balanced mix of crops in our strategic growth plans. So, Bharatbhai, this is in short how I can answer your question.

(Inaudible 52.06)

Bharat Shah: … more detailed discussion on these. Probably in this format it may be difficult to discuss in greater details. But I will (inaudible 52.20) take up issue…

Satish Kagliwal: Yeah, yeah most welcome Bharatbhai, most welcome.

Pavitra: Thank you sir! We have next question from Mr. Ravi Nardi from Naredi Investments. Please go ahead.

Ravi Naredi: Sir, nice result you had posted. My point is that, after COVID 19 every sector is in consolidation phase. So, will you tell what is happening in seed business?

Satish Kagliwal: Seed business is also consolidating Ravibhai. We are not different than others.

Ravi Naredi: And are we going to acquire any company or any business or like this?

Satish Kagliwal: No, no, not in the consolidation phase. We are making a quantum jump in our top line and we are trying to maintain the margins and the bottom line. These are difficult achievements based on what is happening today. Currently, let us consolidate, let us continue what we are doing. Down the line, maybe, we will see.

Ravi Naredi: And sir, this our product, Win-chi-win, what is that product and…?

Satish Kagliwal: Win-chi-win is a growth regulator. We call it a plant nutrient supplement. You see, what happens, when we grow old, you must have heard the product called Revital, which has multiple Vitamins for people and they give you all the kind of growth. This is a foliar spray and it is converted into root spray also and this is the one which carries all the essential elements that are required for the regulated growth of a plant like Manganese, Zinc, Boron, NPK, all these things are available. It is a wonder product, its results are very, very good and we are hoping that it will give us very good top and bottom line.

Ravi Naredi: Ok. Ok. Thank you from my side.

Pavitra: Thank you sir! We have next question from Mr. Karthikeyan VK from Suyash Advisors. Please go ahead.

Karthikeyan V K: Sir, good afternoon! Can you elaborate on working capital improvement that you achieved on slide level? Some details on what you have done.

Devinder Khurana: Karthikeyan, asking details as always. Fine. Our inventory is going to go up because we have enhanced targets for the coming year. Our debtors have come down. Our creditors have also reduced. And our advances have marginally increased. This has given me a better working capital this year. Down the line you will find debtors coming further down as well as number of days; although quantitatively it will increase. As far as inventory is concerned, we continue to grow because if I want production for next year, I need inventory this year. So, that will continue to grow, advances will also continue to grow because we have to acquire more land. So, keeping that in mind, the working capital cycle improved.

Karthikeyan V K: Right. What would be the advances numbers at the end of May, sir?

Devinder Khurana: May, don't ask me about May! I am here discussing March, Karthikeyan.

Karthikeyan V K: But… Ok.. whatever. Ok. Thank you!

Pavitra: Thank you sir! We have next question from Mr. Keval Akshar from Investment Options. Please go ahead.

Keval Akshar: Good morning sir! Congratulations for the result. I have two questions. The first is are you planning any CAPEX ahead? I mean any major CAPEX.

Devinder Khurana: I answered that. We don't do much CAPEX. Not much. So, we go for using the rental facilities for processing plants and godowns and all that. So, as a company as a matter of policy we don't go for major CAPEX.

Keval Akshar: Ok. And the second question is, are the margins sustainable and can they be seen grow ahead?

Devinder Khurana: Yeah, I also touched that. We will continue to maintain 50 to 54% irrespective of the product mix. We will continue to maintain our product mix in such a way that our margins, gross margins stay in around 52 to 54% with the ABITDA trying to cross the 20% line.

Keval Akshar: Ok. Thank you sir.

Pavitra: Thank you sir! We have next question from Himanshu Pant, an individual investor. Please go ahead.

Himanshu Pant: Hi! Good afternoon team! And I would like to thank your team (inaudible 56.53 to 56.56) Sir, my question is, regarding the cotton packets which you have mentioned target is around 1.75 (inaudible 57.04) 17 lakhs. I just want to know, why dropped it from 2 lakh… 20 lakhs to 17 lakhs and the second question is, sir when you are planning to get dividend as well.

Devinder Khurana: Your first question was clear. Can you repeat the second question, so that I can answer together? One is you said why you came from 20 to 17. That is fine. Second question?

Himanshu Pant: Sir, when you have positive about cash-flow of 10 crore has been generated (inaudible 57.43) when you are planning to pay dividends?

Devinder Khurana: Oh, two questions. I will answer the first question, the second one I will pass on to Mr. Kagliwal. As far as our trying to reduce the packets from 20 lakhs, that is what the guidance we are contemplating, 17.5 is for two reasons. Firstly, some production in Gujarat has taken a lot of beating. Our production has gone down because of unprecedented rains and things like that. So, as a result we lost some part of production because of some unprecedented condition including COVID at the initial stages of production. So, that would give us a little beating. But don't worry, if we are unable to do it this year, we will patch it up for the next year. As far as payment of dividend is concerned, I would request Mr. Kagliwal to answer that.

Satish Kagliwal: Mr. Himanshu, we are very happy that you are an individual investor and you are attending this call. I really appreciate this question of dividend. We will be very happy to look at this dividend in a… I would say in a short time. This is the first time, I think we are seeing a positive operating cashflows, right? So, there is a need to further consolidate. This COVID has also affected our thinking to a large extent. This is I would say, dividend is on our agenda so that we are able to look at it in a much positive way next year.

Himanshu Pant: Thank you sir. That answers my questions.

Pavitra: Thank you sir! We have next question from Pramod Prabhu, an individual investor. Please go ahead. We have next question from Pramod Prabhu, an individual investor. Please go ahead sir. Sir, it looks like the participant line is not active. Next we have follow up question from Jai Arora from Brichwood Capital. Please go ahead.

Jai Arora: Hi sir! एक suggestion या ͩफर recommendation, it is nothing related to performance, but some strategic initiative. Sir, can we think of starting of service vertical as well, like for example, consultancy. We are already selling seeds to the farmers. Can we sell insurance to the farmers or something like a scheme – If you are taking our cotton seeds, then your field is already insured. Some tie-up with insurance companies. Secondly, in South Gujarat, from where I am, people have a lot of land bank and now and because of the real-estate prices going down, people have started thinking of utilizing that land to develop greenhouse and grow vegetables. And are eagerly actively talking for companies who can do entire EPC project like setting up consultancy, provide the right quality seeds. And since we have the expertise of seed level tweaking, I believe if we develop this, it will very much, in few years of time will help our vegetable vertical in a very big way. And also increase our awareness of Nath.

Devinder Khurana: I think I will request Mr. Kagliwal to take up this one.

Satish Kagliwal: Well, very, very interesting suggestion and actually these ideas are fantastic. And this becomes… I would say very relevant additional opportunities for financing business. I really appreciate the ideas. Insurance, there

are lots of players working on insurance sector. And we will have to become a major (Inaudible 01.01.21) insurance company. It is a tough call, but still worth intervening. When it comes to vegetables consultancy to Gujarat farmers, they are already much advanced. Our vegetable teams, which are selling vegetable seeds are already providing them consultancy, so called consultancy free of cost. Advising them how to grow vegetables in green houses, poly-houses or even in open conditions. So, we are not charging them for services. But our vegetable seeds sales includes this kind of service of training farmers how to grow vegetables in the best possible way. So, I think it is a good thought, going forward, it is a very forward looking idea. Let us see, it is very pre-mature for us to immediately comment on this suggestion, but I really appreciate the thoughts and ideas.

Jai Arora: Sir, just 2 questions. Vegetable seeds that we have at present, is it compatible with hydroponics system, a model new kind of farmers are opting for? Especially the new ones who are entering this segment.

Satish Kagliwal: Yeah, they are compatible. The only thing is hydroponics practices have to be different. So, we are not very actively testing our seeds and deciding on hydroponics practices to be followed. We are not doing that much, that as much as our testing… So, I would say they are suitable but we are not aggressively promoting hydroponic system as of now.

Jai Arora: Ok. Lastly, What is, the government for example has been focusing, specially the PM has been focusing on doubling the farmers' income. So, your view, what is the total component of a seed cost? I personally believe you are using the right seed is the first quality initial and easiest method to increase the revenue, or earning of a farmer. So, what is the seed cost in comparison with the entire cost to the farmer. (inaudible 01.03.29) ͩकतना खचा[ होता

है?

Devinder Khurana: Jai, seed is just 8 to 10% of the overall cost of the farmer. 8 to 10% of the overall cost, but if you don't have good seed, the 90% cost is dead. (Inaudible)

Hello, if the government is planning to increase the income of the farmers, and doubling it, then it cannot be done at the cost of reducing the seed or making the seed cheaper. Because if you spend 40000 rupees per acre than the quantum is just 800 bucks, you know? So, the government should increase the procurement rate, they should give them better facilities, you know what all. But the seed is just 8 to 10% of overall cost.

Jai Arora: Ok. Just my last suggestion. Right now people are always looking for destructive of new… destructive ideas and I would suggest the management to look at new kind of hydro-farming, a new kind of, what you say, system which are being developed or being … Èया कहते है, बोहोत óयादा [inaudible

1.04.45)

Devinder Khurana: All your suggestions are recorded and noted. And we will do what best we can do.

Jai Arora: Ok. Good, Cool. Thank you!

Pavitra: Thank you sir! Ladies and gentlemen, due to time constraints we will be taking only last 2 questions for the day. We have next follow up question from Mr. Rohit Nagraj from Sunidhi Securities. Please go ahead.

Rohit Nagraj: Yeah, thanks for taking my question. In terms of guidance, in last quarter we were estimating at about 400 to 450 crores of top line, and currently we are based on 20% growth and expecting about 350 crores. So, is this only because cotton packets being reduced from 20 lakhs to 16-17 lakhs? Or is there other component also?

Devinder Khurana: Rohit, we have always been maintaining 20 to 25% growth on the top line. Ok? So, last year I gave a guidance of around 380 sorry, 280 to 300 and we touched around 280. You make it around 20%, it goes to 350 – 360. I think in the current scenario that is the best which we can do, which is good. And 450 is for next year. We are jumping for 2 years.

Rohit Nagraj: Ok. No, because till last year talking for FY 20, we were estimating 400 – 450. Probably it is because cotton disruption that has happened and may be because this guidance has been turned now. My second

Devinder Khurana: … also taken a beating. Production also has taken a beating because of COVID but I think we will be able to cover it up.

Rohit Nagraj: Cool, cool. That's good. And sir, if you can just give revenue break-up in rupees for all the five segments. Is it possible for you?

Devinder Khurana: Ok. You want… just give me a second. Ok. Ok. Then, cotton was around… cotton was around 85 Cr.

Rohit Nagraj: Ok, right.

Devinder Khurana: Paddy was around 89. Vegetable and Win-chi-win put together 54.. 58, sorry. And you can do the calculation for the balance crops. Will that be ok?

Rohit Nagraj: Alright. Thanks a lot. Yes, thanks a lot and best of luck!

Pavitra: Thank you sir! Last question for the day comes from Mr. Viraj Kacharia from Securities Investment Management. Please go ahead.

Viraj Kacharia: Yeah, thanks for the opportunity. You mentioned about, you know it will be very difficult for the small and … smaller players in the industry, so, as a possibility industry, how much you know, what would be share of smaller guys and which crops they would be concentrating on?

Devinder Khurana: We were talking of cotton, there are too many marginal players, small players who continue to put in their products also and they give competition to established companies as well. This year because of the restrictions of transportation, movement across the districts, Mr. Dhande mentioned and also the effect of COVID the small people, the smaller players have not been that aggressive, rather they have been absent. So, as a result their products will get a beating and therefore bigger companies would be able to gain their share. This is what we meant.

Viraj Kacharia:	So, it is only in cotton or in other crops as well.
Madhav Dhande:	No, it is true for paddy and bajra also.
Viraj Kacharia:	And usually, what will be the share in the industry of thesmaller guy (inaudible 01.08.16) Indicative, not exact.
(Inaudible 01.08.26)
Devinder Khurana:scenario.	He is asking for share of smaller people in the overall
Madhav Dhande:	Ok, ok
Viraj Kacharia:	You know, different paddy, cotton and bajra you talked

about.

Madhav Dhande: Sir, I will answer you. This we call it as an unorganized sector. Normally, unorganized sector small players or the little bit mid-cap players. They depend only on big players to get their materials for the use of purchases of the material, cross-purchases of the materials, getting it packed and other things. It is being done mainly in case of paddy in a very big way, particularly in northeastern part. Then bajra as well as cotton. Cotton of course, cotton almost 60 small cap companies are there. Mostly they are from Andhra and Gujarat but mainly they are from Gujarat. This year, neither the paddy company nor the bajra company, nor the cotton company could procure it, could not process it, because of the security, because of being not available, labour problem. And could not reach and make a inter-district movement also. So, that's why they are badly hit.

Viraj Kacharia: So, these crops, you know, as part of the overall industry size for them, you know, would it be like 20-30% or 10%?

Madhav Dhande: Around 20%sir. It is around 20.

Viraj Kacharia: Ok. That's all from my side. Thank you!

Pavitra: Thank you sir! That would be the last question for the day. I hand over the floor to Mr. Devinder Khurana for closing comments. Over to you sir.

Devinder Khurana: At the outset, I would like to thank all of you from core of my heart for showing tremendous interest in our company and the business that we do. And also for making up your precious time and meet us in this dire states of COVID. I would just like to make a point that we would continue to strive to try and meet up with your expectations through research, dedication and hardwork. I would like to thank you once again for being here. Thank you! Thank you very much!

Pavitra: Thank you sir. Ladies and gentlemen, this concludes the conference call today. Thank you for your participation and for using Doorsabha's conference call service. You may all disconnect your lines. Thank you and have a pleasant day.

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Note: 1. This document has been edited to improve readability. 2. Blanks in this transcript represent inaudible or incomprehensible words.