Shalimar Paints Limited has informed the Exchange about Transcript of Analysts/Institutional Investor Meet/Con. Call
SHALIMAR PAINTS
June 07, 2022
BSE Limited Corporate Relationship Department, 1* Floor, New Trading Ring, Rotunda Building, P.J. Towers, Dalal Street, Fort, Mumbai - 400 001 BSE Scrip Code: 509874
National Stock Exchange of India Ltd Exchange Plaza, 5" Floor, Plot No. C/1, G- Block Bandra Kurla Complex, Bandra (E), Mumbai — 400051 NSE Symbol : SHALPAINTS
Sub: Transcript of call with investors and analysts held on May 31, 2022 at 04:00 P.M.
Dear Sir/Madam,
In continuation to our letter dated May 27, 2022 and pursuant to Regulation 30 read with Schedule ITI of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, please find enclosed herewith the transcript of conference call held with the investors and analysts on May 31, 2022 at 04:00 p.m. on the financial results of the Company for the quarter and financial year ended March 31, also link: https://www.shalimarpaints.com/investors-relations.
the Company’s website
transcript
available
2022.
said
The
the
on
at
is
You are requested to kindly take the above information on record.
Thanking you,
Yours faithfully,
For Shalimar Paints Limited
t Sy) —_— Shikha Rastogi Company Secretary
Encl.: as above
| SHALIMAR | | |
AINTS
Shalimar Paints Ltd. Corporate Office: 1* Floor, Plot No. 28, Sector 32, Gurugram - 122001, Haryana Regd. Office: Stainless Centre, 4” Floor, Plot No. 50, Sector 32, Surugram - 122001, Haryana. Call: +91 124 461 6600 Fax: +91 124 441 6659 Toll Free: 180-103-6509 Email Id: askus@shalimarpaints.com Website: www.shalimarpaints.com CIN: L24222HR1902PLC065611
©
SHALIMAR PAINTS
“Shalimar Paints
Q4 FY2022 Earnings Conference Call”
May 31, 2022
©
SHALIMAR PAINTS
cHor@®e s@cPAi
MANAGEMENT: MR. ASHOK KUMAR GUPTA - MANAGING DIRECTOR -
SHALIMAR PAINTS LIMITED
MR. MOHIT KUMAR DONTER - CHIEF FINANCIAL
OFFICER - SHALIMAR PAINTS LIMITED
MR. KULDEEP RAINA, DIRECTOR - SALES, MARKETING
AND
STRATEGIC
SOURCING - SHALIMAR PAINTS
LIMITED
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Shalimar Paints Limited May 31, 2022
Moderator:
Ladies and gentlemen, good day and welcome to the Q4 FY2022 earnings conference call
of Shalimar Paints Limited. As a reminder, all participant lines will be in the listen-only
mode and there will be an opportunity for you to ask questions after the presentation
concludes. Should you need assistance during the conference call, please signal an operator
by pressing ‘*’
2
and then ‘0’ on your touchtone phone. Please note that this conference is
being recorded. I now hand the conference over to Ms. Rasika Sawant from Orient Capital —
Investor Relations Partner. Thank you and over to you Ms. Rasika!
Rasika Sawant:
Thank you and welcome to the Q4 FY2022 earnings conference call of Shalimar Paints
Limited. Today on this call we have Mr. Ashok Kumar Gupta — Managing Director along
with the senior management team. This conference call may contain forward looking
statements about the company which are based on the belief, opinions and expectations as
of today. Actual result may differ materially. These statements are not the guarantees of
future performance and involves risks and uncertainties that are difficult to predict. A
detailed safe harbor statement is given on page No.2 of the company investor presentation
which has been uploaded on the stock exchange and company’s website as well. With this, I
now handover the call to Mr. Ashok Kumar Gupta for his opening remarks. Over to you
Sir!
Ashok Kumar Gupta:
Good morning friends. Welcome to this conference call. As would you all have seen that
our results for the quarter January-March have been much better than earlier. We have been
able to show a growth in
sales, particularly in the industrial segment even with the
decorative segment the performance has improved in
the water based category. My
colleague Mohit will give you the financial results then we will open it for question and
answer.
Mohit Kumar Donter:
Thank very much Sir. Good evening everyone. Welcome to this conference call
all the
investors. I hope you are taking good care of your health and yourself. Let me bnef you
about the last quarter operations as well as the financials and after that me and my colleague
Mr. Kuldeep and Mr. Gupta will take any questions if you have any queries on the
performance of the quarter.
In the last quarter we have grown by 9% from last quarter which is December 2021 and
during this quarter, the company has grown in water based segment by 18% if I talk about
in last two years from March 2021. Company has also grown significantly in the industrial
segment by 31% from the previous quarter and 14% from the last. Over the last few
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quarters the raw material prices have seen an increasing track which have contracted the
gross margin and impacting the overall profitability of the company. During the quarter the
cost of goods sold remain at 71% which is 5% lower than the last quarter and 3% from last
year. So during the quarter the cost of goods sold, we tried to restrict up to some extent
because of the price increase of 7% to 10% during the quarter and if I talk about the full
year we have taken around 25% to 30% of the price increase.
The company has taken the price increase of 7% to 10% until the last quarter and 25% from
the last year. In the quarter we have positive EBITDA of Rs.20 lakh which was a negative
in the last year same quarter and a loss of Rs.12.7 Crore mainly on account of high cost of
the raw materials and the increasing trend in the commodity cycle. If I talk about the full
year which have closed the year 358 Crore which is a growth of 10% from the last year. The
cost of goods sold which is 75% of my net receivables increased by 7% in the topline which
has significantly affected my gross margin by 7%. Moreover the other cost has been
sustained the other expenses are increased by 1% on account of a few debtor adjustment
line item and other fund raising cost which company had incurred during the year. The
EBITDA is negative 17 Crore during the year and the working capital days if 1 talk about
71 days which is now 64 days. The inventory as well as debtors both are the same as in the
last year, however we have significantly improved in the payment cycle because now the
company has gone to get the confidence of the vendors while paying them in time and
clearing the old debts. So that is it from my side. Over to Mr. Gupta.
Ashok Kumar Gupta:
So with this small briefing we are now open for questions.
Moderator:
Thank you very much. We will now begin the question and answer session. The first
question is from the line of Vaibhav, an individual investor. Please go ahead.
Vaibhav:
Thanks for the opportunity and good afternoon to the management. I have two specific
questions on your fund raising, the first one is that for the funds that you have raised so far
how does that reflect on your balance sheet right now because it seems you still have a
fair
amount of borrowing and you are still carrying a decent amount of cash that you have
received so that is the first question if you could have answer that please. Thank you.
Mohit Kumar Donter:
Thank you Vaibhav. Thank you very much. So as on 31 March, 2022 the company has a
total deposits of Rs.165 Crore and if] talk about the borrowing side, the company has some
long term borrowings which is
in the form of term loan from IDFC we took around
December last year and some CECL loan which now government supported us at the time
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of Covid so those are the loans which are reflecting in the books in the long term as well as
in the short term borrowing and at the same time we reduced our cash credit limit by almost
70%-75% and utilized only 30% of that, total limit allowed. At the same time the company
has the amount in asset side that we kept in FD by around 150 Crore.
Vaibhav:
Understood. And Sir this money you have received the 215 Crores that is fully received on
form of preferential shares, I believe the optionally convertible debentures of 55 Crores that
money would have come and have the warrants that you announced in March of 2022 the
25% paid up to that extent has that money also come in Rs.38-odd Crores?
Mohit Kumar Donter:
No, that money has came in April, so as of 31 March that money was not in the books.
Vaibhav:
So Sir Rs.38 Crores has left?
Mohit Kumar Donter:
So out of 150 Crore, 25% we have received in April that is of warrants, but preferential
capital and the debenture of 55 Crore that money came in February itself so that is
reflecting in my balance sheet as on 31 March, however warrant money will reflect in June
financial year.
Vaibhav:
Okay understood. Sir second question is the fund raising that you have done across these
two rounds we remember that in the third quarter results call and this was after the initial
round of fund raised from Inframarket which was the combination of equity and
convertible debt that you have done, you had said that there is no further infusion which is
been planned so what changed that between then and few weeks later when you have
announced the second round in which both the promoter and Infra.market has invested
again and most specifically what made you choose this specific structure which is through a
partially paid up warrants kind of a structure?
Ashok Kumar Gupta:
Mohit one second, so what happens the difference is, while the initial round of funding was
primarily for the working capital purposes, the second round is basically for capital
investments, so the second round is primarily with the view of increase in capacity of the
company, as you know we have three plants and one plant in Howrah is closed, today the
condition of the company what it is we were having plans to modernize our plants, a cost of
production is slightly higher because the plants are old and they are highly manual, so to
increase both the capacity as well as to automate the plant we needed this capital that is why
it has been raised.
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Vaibhav:
Yes, again this is my very simple and humble view point that, I do not know, this structure
itself seemed very weird and probably not the nght way, the way I looked at it was that this
is basically you have partially paid significantly the money option to the promoter and
Infra.Market and not allowed any minority holder to participate, the way I look at it is that
Shalimar is nght now very small so this kind of equity issuance might fly under the radar, I
guess that is the main headlines talk, one of the index talk, there would have probably been
a lot of questions for the management on thing such as governance as well as minority
interest and possibly you would have probably seen a very significant price impact as well,
but as soon as I read this news I thought there would be a lot of question and probably you
will see, for some reason that did not happen, my whole sense was why this is not happened
for Shalimar is purely because of the fact that the company and the stock is relatively small,
so I am not sure what made you think of this structure, why you did not go for a nghts issue
or a plain vanilla equity issuance even if the promoter had to participate I did not see any
reason why they should have been or anyone asa publicly listed company should have been
incentivized disproportionately versus the minority shareholders so
I think that was the
point I was trying to make.
Ashok Kumar Gupta:
It was the decision we have taken because the right issue and all other means of investment
were all viewed and a decision was taken where it is possible that the money will be coming
from, where that we were sure that the funds will be raised that was the necessity that we
wanted to ensure that the funds will come through and that is how this particular instrument
was looked at.
Vaibhav:
Sir again I think, I do not want to hog the limelight here I will ask this later, let others ask
questions as well, but this is very contrary to
a view which good companies which have
shown good corporate governance and you look through the last 20 to 30 year history and
you know companies are either than divested future the kind of value they have associated,
the companies like Wipro or even very recently the kind of the partially paid issuance that
Reliance did it was done for all shareholders, this seems like instead of Rs.130 price I can
pay up 25% and when we know the kind of prospects that a company like Shalimar has
over the next two three years even if you use basic corporate finance principle and use the
cost of equity as the benchmark the kind of severely in the money option that promoters
have got it seems something which is very difficult to digest for a minority shareholder,
again it is a decision which the management has to take all minority holders approve, | am
sure there is
a whole process that you have gone through but intuitively to
a minority
shareholder it does not look right, if this was a headline company doing this I am sure there
would have been a lot more questions, I am just giving this as feedback to you guys.
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Ashok Kumar Gupta:
Yes, we understood your feedback and yes, we understand what you are talking about, yes
of course the decision was taken keeping in view what are the possible fall out of different
options and this was considered as better way of facing it.
Vaibhav:
Right Sir, thank you so much and all the best for the future.
Ashok Kumar Gupta:
Thank you Vaibhav.
Moderator:
The next question is from the line of Vishwajeet Singh Rathod with Equity Research.
Please go ahead.
Vishwajit Rathod:
Good afternoon every one. Sir I had a few questions regarding our facility. So currently we
are operating three manufacturing facilities with an annual production of around 69,000
plus kilo liters I just wanted to know at the moment what is our current capacity utilization
and how are we dividing this capacity utilization for decorative versus industrial paints?
Mohit Kumar Donter:
So Vishwajit you have rightly mentioned that we have a production capacity of 69000 kl
per year and as of now our Sikandrabad plant which is in fact north hub and catering to the
northern and eastern market is operating at 75% of the capacity, 75% to 80% hovering
around 5% plus or minus. Our Nasik plant which is catering to western market is operating
at 60% to 70% of the capacity, however our Chennai plant taking care of southern market is
operating at lower capacity. So in comparative if I talk about our all India capacity is being
operational I would say 50% to 60%.
Vishwajeet Rathod:
Okay so within this 50% to 60% what is the difference which we have for decorative paints
versus industrial paints like in terms of kiloliters?
Mohit Kumar Donter:
So typically all the manufacturing plants are equipped well for the production of industrial
as well as the decorative paints, whereas within the segment as we have a share of 30% to
35% in the industrial segment and 65% to 70% in the decorative segment. If I compare my
production capacity we can very well produce more than 50% for the industrial side
because most of the machines we can shift or we can convert as per requirement. Typically
there are few machines which are only for the industrial because those are solvent based,
where 100% capacity is dedicated to industrial.
Vishwajeet Rathod:
So out of the 30%-35% of the industrial paints which we are currently doing we are
generating 144 Crore revenue from it, at 9700 kilo liters which we are doing in volumes, so
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our margins in the industrial paint versus the decorative paint do we have a huge difference
substantial difference, or it is almost the same?
Ashok Kumar Gupta:
So let me give a view of margin of the different segments, we are working on industrial
segments and within decorative we are working in solvent based and water based, you
know all prices have increased by more than 100% in last one and half to two years, our
margin prior to that used to be almost similar in all the three segments that means industrial,
decorative solvent and decorative water based. After the increase in
oil prices, solvent
paints have taken a big hit, while the cost of production has gone up, raw material have
gone up finished prices have not increased in tandem, the increase is gradual, it
is
happening it is taking time, there is a lag, because of that lag margins of water based are
much higher than the margins of industrial or solvent based.
Vishwajeet Rathod:
Okay, so I would not take much of your time I will come back in the queue but thank you
for answering all my questions.
Mohit Kumar Donter:
Thank you.
Moderator:
The next question is from the line of Rajesh Chawatia, an individual investor. Please go
ahead.
Rajesh Chawatia:
Hello thanks for the opportunity. First Sir if you could help me with the roadmap of the
FY2023 and FY2024 going forward?
Ashok Kumar Gupta:
So FY2023 and FY2024, as we are having two things in mind one is our capacity utilization
which means basically we will be increasing our sales so our plan is to increase sales so that
existing capacities can be better utilized at the same time we will
be increasing our
capacities as well. I cannot give you exact numbers like how much increase will happen but
we are planning that our increase will be much higher than the industry average. We hope to
gain market share from other players.
Rajesh Chawatia:
Okay and Sir this capacity increase will be via way of fresh capex or de-bottlenecking in
existing facilities?
Ashok Kumar Gupta:
I think this is very relevant point you have raised, so current facilities the way they are they
are pretty old, and also the capacity of each plant is in the range of around 20,000-25,000 kl
per annum, now typically if you see the modern plants, most of them are having capacities
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of at least 50,000 to 100,000 kl per annum, so that way our capacities are much lower. What
it linked to it leads to slightly uneconomical production cost, so we are now modernizing it
de-bottlenecking it also increasing marginally our capacity so that capacity of each plant is
at least 50,000 to 100,000 kl per annum with that not only the production volume can go up
but more important than that our production cost can come down and so also the quality can
improve. Today we are taking small batches, the quality differs from batch to batch and
then because lot of work is manual the quality also at times suffers. So we are carrying out
debottlenecking, we are carrying out capacity expansion and we are carrying out some kind
of a brownfield expansion.
Rajesh Chawatia:
Okay, thank you Sir, that is it from my side.
Moderator:
The next question is from the line of Aditya Deorah with Divisha Investment. Please go
ahead.
Aditya Deorah:
Good afternoon Sir. Sir since we last interacted I believe we have gone in for an auditor
change so Sir can you highlight what are the internal changes we have made inside the
company since you have done preferential after a year than the preferential allotment?
Ashok Kumar Gupta:
So the first work we had doing internally is strengthening our team. Since the company had
limited funds earlier we were not going aggressive on talent acquisition but after fund
acquisition the first step we are taking is talent acquisition, as you know people are the
pillars of any good organization so keeping that in mind we are trying to get the best people
on our team, we have taken a very senior person in sales from a different company, having a
wonderful experience in paint industry so also in production. We are also focusing on IT for
which we have taken a senior person from the field and we are also taking some senior
people in research R&D, these four are the pillars for any organization, sales production
apart from the work we have already done in supply chain, source chain, finance and HR
where we already had very stable and a strong team so with this the first step we are taking
is strengthening our leadership team within the organization. Apart from that we are
working on system and processes, so that when the new auditor comes similar processes are
robust enough to give the desired level of comfort to the new auditor. These are the two
things primarily we are doing.
Aditya Deorah:
Okay, Sir have we started using the infra market distribution network?
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Ashok Kumar Gupta:
So Infra market has started working on their sales and they had started contributing in a
limited way in our overall sales so that first step have been taken and slowly they will be a
playing a very major role in our operations.
Aditya Deorah:
Sir with respect to the industry, if we just go back the headlines we see that there are new
players who are entering this industry so how do you see yourself, you see yourself as a
challenger or an incumbent.
Ashok Kumar Gupta:
So if you see the new players who are coming up primarily they are focusing on at the
moment on decorative paints so we see that we have a very established brand so to that
extent we are a challenger in the sense that we are already in the country, we have
established presence, distribution is strong and with capital having been infused is
a
question of utilizing our facilities and taking the company to greater height. The new
facility which are coming will have to take time to establish themselves and workout their
own niche in the market so perhaps we are better placed to be present in the market than the
new players.
Aditya Deorah:
Sir just one last question, you mentioned about the capex that you will be incurring this year
for expansion of the plant capacity, how much would be the spending on the same, this year
and the next year?
Ashok Kumar Gupta:
I think within next two to two and half years we will be spending around 100 to 150 Crores
in capex expansion but plans are still being worked out, nothing is final as yet, perhaps by
the end of this quarter we will have something more concrete plans.
Aditya Deorah:
Okay thank you Sir.
Moderator:
Thank you. The next question is from the line of Ninad Sabnis with Sabnis Financials.
Please go ahead.
Ninad Sabnis:
Good afternoon, thank you for giving me the opportunity. So I have been hearing through
the call and] guess my question is also on a similar line as the person who asked before me,
everybody is excited about the up liftment in business which can be brought by Infra market
and I just wanted to know how can we leverage this further to enhance our supply chains,
because we have a decade or almost a century old presence in the country, which are some
specifics would you be approaching in the say first half of the next year?
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Ashok Kumar Gupta:
See you rightly said, our biggest strength is the products we have or products being suitable
for their applications and most importantly the faith and trust, and the second strength we
have is our team so first step we are taking is utilizing that trust, improving ourselves so that
the trust and the strength of brand which we have can be utilized so our first function is
increasing our distribution, increasing our customer base. Products are already developed to
a large extent and with the fund being now available it is possible to expand our customer
base. So in the first two months we received funds somewhere in last week of February, we
have been able to increase our customer base to some degree, this process has strengthened
up now in speed and we hope to double our customer base in may be next couple of years.
So that is our first attempt. Current product line plus our brand leading to increase in
customer base which will obviously increase revenue. Our second strategy would be
working out and wherever the gaps in our product line with the help of R&D we will be
filling those gaps in fact we are hoping to give a big boost to the current range of products
we have. So far as decorative is concerned we already have around 70% to 80% of the
product which are required in the market, balance will be developed in due course, on the
industrial front as you know we have a very good name and very good approval rating there
we will be increasing our product to a large extent so that we can cover almost the entire
industrial protective coating market.
Ninad Sabnis:
So if I may ask a follow up on that, looking at our growth how much will it be driven by
value and how much we anticipating or we targeted for FY2023?
Ashok Kumar Gupta:
We are working on much higher than the industrial growth, so if the industry grows say by
around 12%-13% we are planning to increase more than double of that industry growth.
Ninad Sabnis:
Correct Sir, but majority of the volumes would be I am assuming more from the industrial
side and followed by the decorative?
Ashok Kumar Gupta:
Yes, the growth may be faster than earlier in industrial as compared to decorative.
Ninad Sabnis:
So I just wanted to understand the mix, alright so this pretty much answers my question.
Thank you so much for your time and best of luck for FY¥2023.
Moderator:
Thank you. The next question is from the line of Vaibhav an Individual investor. Please go
ahead.
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Vaibhav:
So thank you for the opportunity again. So Mr. Gupta I have a question specifically for you,
you surely have done a great job when specially you contextualize what Shalimar has been
able to achieve through the pandemic situation, we are now at a steady state base of at least
400 Crores of annualized revenue. We are also hearing a lot of news of Infra market getting
very aggressive in expanding its footprint and there has also been a lot of news and you also
talked about in plenty of new appointments at Shalimar. Now you have already mentioned
that targeting, say a doubling of growth versus industry benchmark but probably if you
could throw more color on how this revenue trajectory would play out say over the next
three years especially against the context that you know when you took over you had
outlined a goalpost of reaching about a Rs.1000 Crores of revenues, how does that target
get bolstered either in terms of the target getting higher or the timeline is getting
significantly shorter with all the positive developments that have been happening around
Shalimar and Infra, that is the first question? Thank you.
Ashok Kumar Gupta:
I think you very nghtly said that we had planned for a significant growth couple of years
back now there were two challenges we have faced. All along we faced the problem of
insufficient funds and as ] mentioned earlier also the issue was having funds even to supply
current customers and the second was Covid. Now if you see Covid impacted all the
industry and within the industry all the players. We were slightly more affected because our
cash flows totally got jammed. This infusion has opened up those avenues and now I think
we are well on way of achieving the 1000 Crore target, we cannot say the number of time
period we will take, but now with the kind of results we have seen in last three months, the
base figure which have come in three months, we see that our objective our mission our
dream of crossing 1000 Crore is looking within reasonable period within reach and that is
why I mentioned that we are planning that even if the industry grows by around 10%-12%
year on year we should be growing at least double that pace so with that you can understand
that we plan to cross 1000 in next two-three years, three-four years at the most.
Vaibhav:
Okay Sir,
that
is great to
hear and there
is obviously going to
be
a contribution
incrementally on revenues through Infra.Market, so how should we look at margins of
product which you will
sell through your conventional channels versus that through
Infra.Market and there have been, I think there were some questions in the previous few
quarters about possibly a private label or manufacturing contract that Infra Market might
have with Shalimar where Shalimar could do the manufacturing and Infra would sell it so if
that were to happen, so one is that you know something which we are still working towards
and if that were to happen what would margin look like?
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Ashok Kumar Gupta:
So, you know so far as Infra.Market is concerned they are like any other channel we have
for our distribution so the margins by far are same as for other channels whether it
is
industrial or for decorative. So far as now producing for them currently we have plans only
to sell all our products in the Shalimar brand name because that brand name is established
and we want to use it. So there are no plans to the contrary at this moment.
Vaibhav:
Okay, so if I just squeeze in one more on, so at a target of 1000 Crores of revenues that we
are targeting is it reasonable to expect that margin should be in low to mid teens or do you
see any margin pressures or possible the margin tailwind with that level of revenues?
Ashok Kumar Gupta:
So if you see, currently our raw material account for around 70%-71% - 72% of the
revenue. Going forward this should come down and not go up, the reason being that oil
price has increased whatever has happened is ultimately being passed on to the consumers
and if we have to increase our revenue we should not be looking at a significant dilution of
the margin, so the margin may be in the range of 70% to 72% I am talking about the cost of
goods, may be in that range which has been there for last one year, we do not intend to
increase this significantly or reduce our gross margin from 28%-29% to a lower figure to
increase our revenue. Revenue increase should take place by protecting this margins.
Vaibhav:
Understood but at the EBITDA level, so your selling, employee and other expenses there
you do not see either a margin leverage or even a pressure going forward?
Ashok Kumar Gupta:
At EBITDA level this will further improve, because our fixed cost are not going to increase,
fixed cost are sufficient to take us to the 1000 Crore level, so I expect that the EBITDA
level margin will significantly increase as and when the revenue goes up.
Vaibhav:
Understood and I am sure that you do not want to guide us toward any particular number at
this stage.
Ashok Kumar Gupta:
We are hoping for the good numbers.
Vaibhav:
Sure Sir, we are hoping for that too. Thank you so much and all the best.
Ashok Kumar Gupta:
Thank you.
Moderator:
In the interest of time that was the last question. I now hand the conference over to Mr.
Ashok Kumar Gupta for closing comments.
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Ashok Kumar Gupta:
Thank you my frends. I understand my frends and colleagues in the industry of and their
expectation as to the operation of the company and the results. I just want to assure you that
the funds having come in the last month of the last quarter, things are changing fast and you
will see a good improvement in next quarter itself.
I know our shareholders have kept
patience for a long time. I believe and I can assure you that the time for results have come
now and you should be seeing some positivity from this quarter itself. With this, thank you
for your participation.
Moderator:
Thank you. On behalf of Shalimar Paints Limited that concludes this conference. Thank
you for joining us and you may now disconnect your lines.
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