Oriental Aromatics Ltd

- The company is undertaking a phased investment approach, currently piloting the CSTP before proceeding with further investments. - Peak debt levels by the end of the current year are expected to be around ₹370-450 crores. - For ongoing and planned CAPEX (Baroda, Mahad, Bareilly), the company plans to fund approximately 70-75% of the total project cost through debt. - Mahad project’s total planned investment is about ₹100 crores, with ₹25-32 crores already invested. - No explicit mention of raising equity funds in the transcript. - Focus remains on managing internal operations and strategic investment phases with controlled debt funding aligned to project progress.

- The company has ongoing and planned capex across multiple locations: Baroda, Bareilly, and Mahad. - Baroda capex balance is around ₹100 crore; Mahad greenfield project expected cost is ₹92-100 crore; Bareilly capex remaining is small (₹6-7 crore). - Total capex planned for FY24 is about ₹200-205 crore. - Debt funding expected at 70-75% of total project cost, with peak debt around ₹370-380 crore by year-end. - Mahad project is phased, with ₹25-32 crore already invested; total planned investment about ₹100 crore. - The new plant validation and market capture are expected over 6-9 months, aiming to capture 40-50% market share within 2.5 years. - The company continues to invest strategically while focusing on derisking and China Plus One strategy despite market challenges. - Expansion including the CSTP project expected to complete mostly by FY24.

- The company anticipates a challenging next 2-3 quarters with subdued demand and pricing pressures, especially in camphor and aroma chemicals divisions. - Strong growth is expected in the fragrance division driven by new wins and participation in more projects, though overall industry growth is uncertain. - Capacity expansions (Brownfield and Greenfield) are ongoing, expected to complete by FY24, potentially enabling higher volumes in 2-3 years. - Management aims for profitable growth focusing on efficient raw material procurement, cost reduction, and process improvements rather than just volume increase. - Stabilization of demand and pricing is expected after 2-3 quarters, potentially leading to stable EBITDA and higher sales clarity thereafter. - Due to prevailing uncertainties in raw material prices, demand, and competition, precise revenue or volume guidance is deferred until clearer market conditions emerge.

- The company expects a challenging next 2-3 quarters due to subdued demand, pricing pressure, and external factors, particularly in camphor and aroma chemicals. - Management is focusing on internal process improvements and productivity enhancements to remain lean and profitable when demand stabilizes. - They are cautious about providing specific guidance for turnover or earnings in the near term due to volatility in raw material prices and market conditions. - Capex of around ₹200-205 crore (Baroda, Bareilly, Mahad) is planned for FY24, which will support future capacity and growth once market conditions improve. - Emphasis remains on profitable growth rather than volume growth alone, aiming to optimize margins via raw material procurement and operational efficiencies. - Recovery and upward trajectory in earnings, ROE, and ROCE are expected to become clearer after 6-8 quarters when the market stabilizes and new capacities come online.

- The company indicated that for H1 2023, customer RFQs (Request for Quotations) allocations have been honored to about 60-70%, with the remaining either postponed or canceled, reflecting softness in demand. - Inventory buildup is relatively high due to postponed procurements by global customers and slowdown in Europe and America. - There is a challenging environment with subdued demand and oversupply, especially in the camphor market. - Due to these factors, a clearer picture on order book stabilizing is expected only after two to three quarters. - The management prefers not to provide firm guidance at this moment due to market uncertainties. - They are seeing increased participation in new fragrance and flavor projects which is helping the fragrance division grow despite overall market challenges.