Investor Question 1: I wanted to talk about the – can you talk a bit more about the sub-4-ton LCVs launch in India? You mentioned that you started delivering, but these are test vehicles right now. So canyou talk a bit about when would you do a full-scale formal launch? And what’s the outlook for that business from here on?
Karan Shah: Yes. Thank you for the question. I think, yes, as I mentioned in previous calls, we have ample customers across India who are in the e-commerce space, who are in the FMCG space, who are – bodies, large fleet owners, third-party logistics companies, etcetera. And we have started the deliveries of these electrified – vehicles with these customers from the last month, and we continue to do the deliveries in this month. These vehicles will, of course, go through extensive testing in the use case of these customers, which would be anywhere between 3 to 6 months. But in parallel, we are also scaling up the operations so that we are able to cater to the demand once that is confirmed and finalized. Unfortunately, I cannot give you an exact outlook in terms of what the order book looks like because it’s still in the initial phases. But I think the only addressable market that I can talk about, of course, is what I have been saying in the past that there are more than 2 million vehicles running on Indian roads today, and we are associated with some of the largest players in the space who we are able to provide a retrofit solution to. So even a very small percentage of that, if we can address and if we can get it, would be still large numbers for this year.
Investor Question 2: Got it. And you mentioned that the TCO would be much better than the diesel version over 7, 8 years. And how would the TCO compare with the new Tata Ace EV that the OEM has? Let’s say, an existing Dost owner can always sell his – sorry, Tata Ace owner can always sell his Tata Ace and buy a fresh new EV from Tata versus going for our solutions. How do those two scenarios compare? Is it still compelling for the customer?
Karan Shah: Yes. I mean, look, because you’re retrofitting your existing vehicle, you don’t pay the entire cost of purchasing a new vehicle, right? So the cost of conversion minus the vehicles, minus the base vehicle, is surely lower than buying a brand-new vehicle. That’s for sure. So I think the choice that a customer has 5 years into using a vehicle is, should I pay x amount of rupees to convert this existing vehicle into electric and I can basically reap the same benefits of electrification, which is the lower operating cost, lower maintenance cost, etcetera. Or shall I go and buy a new one, which will be more than that x rupees, which it would cost to convert
Investor Question 3: Yes, but I’ll also be able to sell my existing vehicle in the second-hand market. So do you think the sale proceeds from the second-hand vehicle plus the cost of conversion will be lower than the cost of the new vehicle?
Karan Shah: That is what we are targeting to be, but I can’t answer that specifically today.
Investor Question 4: So I have a question. So first is that where is the camshaft business planning for the growth for the next three years? What is the plan? What is the plan for the next three years where the camshaft business is going to grow?
Karan Shah: I think we see very good visibility for the camshaft business. We have long-term contracts with most of our domestic as well as international customers. And we actually see – you’ve seen over the last, let’s say, two years also, we have grown the camshaft business in terms of casting as well as the machine camshafts, and we continue to see that trajectory. I cannot give you a forward-looking number in terms of what we expect the revenue to be. But we are setting up a few machining plants. We have been awarded assembly camshaft business from OEM customers. We actually see growth in the camshaft business in the coming years.
Investor Question 5: Okay. And the next question is, what are the steps you have taken to increase margins in the camshaft business?
Karan Shah: I think one of the bigger actions that we have taken is to set up this large solar power plant in the casting business, a considerable amount of our costs are energy. And by setting up this 15- megawatt solar plant, I think we have reduced the cost of power considerably. And I think other efforts on the material side, as well as machining equipment side are ongoing. But I think the power
cost was a large factor, and that has been more or less reduced by, I would say, 30%, 35% by the solar plant. we start the solar – we have saved approximately INR1 crore from July per month.
80c6a995-97cf-43f6-841e-9bdda69516af.pdf (bseindia.com)
