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00:00 There is yet another counter which has seen a lot of strength in today's trade and that
00:04 is Conference Petroleum.
00:07 Now let's bring that stock up.
00:09 There you have it.
00:10 It's about 12.5-13% higher as we speak.
00:14 And from what we understand is that there has been a company update as well because
00:20 the company has allied with Norway-based listed BWLPG where they will look to source and deliver
00:28 LPG from the international markets to meet India's LPG needs.
00:33 And this is around where we want to have a conversation with.
00:36 So let's get the management in.
00:37 We have Nitin Khara, Chairman and MD of Conference Petro who is joining us on the show.
00:43 Mr. Khara, good afternoon.
00:45 Thanks so much for joining in.
00:47 Can you tell us a little more about this alliance that you have and what it can do for the company
00:52 going forward?
00:54 Yeah, good afternoon Azam.
00:59 Very good afternoon.
01:02 As you all are aware that Confidence Group is having such a big footprint in pan-India.
01:09 It means in short we are the supermarket of LPG and CNG business in India.
01:18 We are the largest, in fact we are the largest LPG cylinder manufacturer in India having
01:23 15 cylinder manufacturing plant, having the installed capacity of 5 million cylinders
01:27 per annum with 68 LPG bottling plant where we are importing LPG and distributing through
01:35 our own fleet road tanker to our bottling plant.
01:38 Through the 68 bottling plant we are marketing in 26 states of India and plus we are having
01:47 250 more auto LPG gas stations across the country.
01:52 Maximum are in Tamil Nadu, in Karnataka, in Telangana, in Maharashtra.
01:58 And we are in CNG also.
01:59 We are having CNG cylinder manufacturing plant, three high pressure cylinder manufacturing
02:03 plant in Dahej, Halol and in Nagpur.
02:06 Plus we are in CNG retail also.
02:10 We have signed one agreement with the Gas Satyop India Limited where we are developing
02:14 100 CNG stations across the Bangalore city.
02:18 And with addition to this BW group as a strategic partner with Confidence Petroleum India Limited
02:27 we are expanding our wings, more wings into auto LPG as well as in bottling infrastructure
02:34 also and CNG infrastructure also.
02:38 See already company is doing good in all this segment, our EBITDA is also good.
02:43 With this our internal accrual as well BW group's investment into company.
02:50 What we have presently auto LPG of 250 stations which we are targeting 500 in coming three
02:56 years as well we are having presently 68 bottling plant.
03:01 Through that we are our 2000 bottling network of India, 2000 dealers network in India.
03:08 We are developing 32 more bottling plant with this investment and also we are expanding
03:15 our wings into CNG that we are developing 100 CNG stations that we are targeting for
03:21 200 more means total 200 CNG stations with other CGT companies also.
03:28 So that's in coming three years we are planning to expand of around say capex of around 2000
03:35 crores in the Confidence Petroleum India Limited.
03:38 Right, right sir, so Mr. Kharad that was actually my next question.
03:42 So you are deploying about 2000 crores over the course of the next three years in all
03:47 the factors and all the areas that you just told us about.
03:51 Can you give us some amount of timelines how much would it be in terms of FI25, what kind
03:57 of what kind of funds from your earmarked well you know well idea that would be deployed
04:06 as far as FI25 goes?
04:10 Yeah, see already almost around 250 crore rupees EBITDA, 225 to 250 crore rupees of
04:21 EBITDA in this year.
04:22 We are targeting for 350 to 400 crore EBITDA in the coming next year, FI24, 25.
04:29 So with this investment of 30 million that is 250 crore from BW Group, we almost around
04:35 say 600 crore rupees expansion in the 24, 25 and plus same in the next year and around
04:44 700 to 800 crore in the 26, 27 that we are targeting in this coming three years.
04:52 Presently we have a input of 250 crore from BW Group no doubt.
04:56 So either we will go for the another to expand our to do this CAPAC, either we will go for
05:02 the date or as company presently don't have any date much more date in the company.
05:07 So we are either we will go for the date or some more equity investment also interested.
05:14 So we will see what type of either we will go for the date or equity participation.
05:20 Sure, sure.
05:21 So we have planned for 2000 crore rupees CAPAC for this coming three years.
05:25 Right, so Mr. Khara then I want to know that going forward I mean I am looking at FI23
05:32 in terms of your sales, your revenue standard little over 2200 crores.
05:37 What kind of growth expectation can we have in terms of your revenue and can we expect
05:42 your margins to maintain at whatever levels they are or can we in fact expect an improvement
05:48 based on some operating leverage benefits?
05:51 Yeah, with this expansion and with this CAPAC what company is going to do in the coming
06:00 three years.
06:01 We are targeting for 10000 crore rupees revenues in the year 2026-27.
06:08 Alright and that also means that you will substantially see higher earnings as well
06:14 going forward.
06:15 In that case can you tell us about the geographies of course you have to a certain extent mentioned
06:21 it is mostly the southern part of India.
06:23 Are you going to look to consolidate in the markets that you are already present in?
06:28 No, see our auto LPG segment that is auto LPG dispensation that is maximums are in South
06:38 India but we have presence in Maharashtra also as well as in Madhya Pradesh also as
06:43 well as in West Bengal also for auto LPG segment but as far as Paxil and the division
06:47 is concerned where we are importing LPG, we are bottling and we are distributing through
06:52 our dealer network is Pan India except Jammu and Kashmir and Far East we have presence
06:58 every part of the country.
07:00 Confidence is the only company who is having such a big infrastructure through Pan India
07:05 where we are marketing.
07:07 Auto LPG we are maximum market share in South India as all auto rickshaws are running on
07:12 LPG in Bangalore, in Karnataka, in Tamil Nadu, in Telangana and maximum cities of the Maharashtra
07:18 also.
07:19 So as see I can put here LPG is the economic fuel definitely with the green economic fuel
07:27 but we can transport LPG very easily from the port to our bottling plant, from the port
07:34 to our auto LPG segment.
07:35 So to develop the auto LPG segment more faster that is why company is thinking to develop
07:41 much more auto LPG station in this Karnataka, Tamil Nadu, Maharashtra and Telangana areas.
07:49 Right.
07:50 So Mr. Khara a final question then from my end.
07:54 Does the change in price of gas have any sort of impact on your business based on demand
08:01 and supply?
08:02 Can you think of a demand and supply equation can shift based on the change in price in
08:06 gases?
08:10 You are asking about the international price or you are asking about the price change in
08:14 the Indian government?
08:15 In the Indian markets.
08:18 Yeah, see Indian market price change is only for the domestic customer means we are not
08:26 targeting domestic customer we are only targeting for the commercial as well as the industrial
08:30 customer.
08:31 Definitely government is giving some subsidy to their domestic customer but in commercial
08:36 it is at par, they are also giving as per the price based on the international market
08:43 they are also supplying and we are also supplying as per the price.
08:46 So in domestic we do not have any competition or we do not do any competition with the Indian
08:54 government like with the PSUs those who are supplying in the domestic.
08:59 But commercially definitely we are getting a good market share with our services, with
09:04 our market establishment and with our unique USPs also.
09:09 Okay, alright Mr. Khara we will leave it at that.
09:11 Thank you so much for joining us and explaining to us how this actually helps your business
09:17 also perhaps so much more in terms of expansion coming over the next few years.
09:22 We look forward to all those steps that you take going up ahead and we wish you the best
09:27 of the future as well.
09:28 Thank you.
09:28 Thank you.
09:29 Thank you.
09:29 Thank you.
09:30 Thank you.
09:30 (dramatic music)
09:33 (upbeat music)