Tariff/Gangavaram noise faded by Q4FY26.

On the Ports business - while overall Ports has done well, Domestic continues to be a little muted even if we see October numbers. What's happening there? On Domestic Ports, what could we look forward to?

all India cargo growth is 4.3%, whereas APSEZ has grown by 6.9%. So, I think we should enter into the top line that we are still growing 1.6x to 1.7x than the cargo growth in the maritime. So, which means APSEZ performance is linked to the trade, and we are doing much better than the trade. And this is the reason that our market share has grown from 27.4% to 28.1%. When I go in detail, our container market share has grown from 44.4% to 45.9%. EXIM coal, all India has gone down, and obviously we have gone down. When we look at iron ore, the All-India iron ore has almost vanished and definitely we have the impact. But on the other side, when we look at coking coal, we have increased our market share from 36.5% to 41.9%. When we look at coastal coal, which is replacing based on Make in India or use in India, which is replacing the EXIM coal, our market share has gone up from 27.8% to 31.1%. Mundra, we have mainly the 3 commodities. Containers, we had the challenge during the Operation Sindoor. And in October, you would have seen that we did more than 720,000 containers, which is really demonstrating that Mundra is getting back after going through the disturbances of Operation Sindoor and so on.

On International Ports, margins have been increasing every quarter and we are at around 24%, 25% margins. What could the potential margins be once we achieve further scale?

Let me just tell you the most important metric is return on capital employed. EBITDA and margin is actually a secondary measurement. But given that we have got already a portfolio of 4 assets, we expect the EBITDA margin when all these operations are stabilized to go from 26% to somewhere between, around 45%. So, that is what actually is our long-term target for the businesses. And Colombo will be around 50%; Haifa will be around 30% to 40%; and Australia will be around 65%. So, it has got different margin profiles.

Looking at your portfolio at 2030, how shall we think about the RoIC for different businesses - high 20s for Domestic? On Logistic and International, do you think on a sustainable, ongoing basis, once they mature, we shall expect somewhere in mid-teen or could it be similar to Domestic? Second, can you bridge today's volume versus the billion ton, given deleveraging?

We actually expect 16% return on equity for all our investments on a fully absorbed project timeframe basis. So, we will deliver this result in each of our business lines that we get into. As far as return on capital employed or return on invested capital is concerned, we commented about a year ago that Logistics and International business will actually keep going up and catch up to the threshold returns. To your question on actually volume bridge, we are this year-round number going to do 510 million metric tons this year as we close the year. International in that would broadly be around 150 million to 160 million metric tons. We have these 4 ports which are actually going to be operational in the current portfolio. As far as the Domestic profile is concerned, broadly speaking, we expect the current portfolio mix to remain the same. We are expecting Dhamra to be taken to 90 to 100 million tons in terms of capacity. On deleveraging - our approach is sort of laid out, we expect cash generation to be deployed first in organic, where we have guided up to INR 75,000 crores over a period of next 5 years. We have said that we would like to actually have a policy of average net debt to EBITDA of 2.5x. We are way under that at this point in time.

Assuming we touch about 510 in the current year, and a billion ton by FY '30 with 150 International / 850 Domestic - which particular cargo sector apart from container do you see picking up? Coal was one of the large ones in the past, but given the context, does it revive or something else picks up?

No, I think at first, we should keep focusing on containers. This is what we are doing. Make in India, the EV scooters, the EV motorcycles export out of India, the EV cars exports are exported out of India. We did record in Mundra now on exporting of cars. I think we should just see this geopolitical impact as an opportunity and not as a risk. The supply chain is resetting. And to answer to your question, container for sure. In addition to the Make in India, I think a lot of containerization of the new commodities are also moving in the right direction. You said coal, but don't forget that coal is also coastal. And as I said before, because of our strategic location around the 11,000 kilometers of coastal line from west to east to south, because of coastal, we get twice the trade. And the third of the liquid, we started from Mundra, then Hazira. East Coast is also redefining the supply chain for liquid. And that's where we decided to have Dhamra and very recently we announced with BPCL, the bunkering for LNG.

On other income that has seen a substantial increase, somewhere around 800 crores in this current quarter - any one-offs? Secondly, on Mundra EBITDA margin - last quarter was around 67%, this quarter gone up to 73%, 74%. Any one-offs and what is the sustainable margin?

First on the other income, there is actually INR 350 crores of dividends, which has come from subsidiary, which is our joint venture in Mundra. Otherwise, it would have come in share of profit in joint ventures, so it's an accounting thing. We did say in Q1 that actually we will expect this to be coming in Q2. And number two, actually there is also about INR 120 odd crores of bond buyback profit. So, we did this bond buyback in the last quarter. On Mundra margin - if you actually compare last year Quarter 1 and last year Quarter 2 also, the pattern is pretty similar. Basically, we have high value cargo like fertilizer and all coming in. Though the quarter 2 volume usually is slightly lower compared to other quarters, but the mix of Quarter 2 is actually oriented towards the higher EBITDA, which is a pattern. There's not one-off in this financial year. And number two, there is a little bit of an increase in our price, which is linked to FX. So, sustainability is actually something that we can assure you that there is nothing one-off or episodic in this EBITDA margin of Mundra.

I see some increase in JV losses. What is the reason behind that, especially it seems to be increasing at Dhamra?

So, first of all, like I mentioned in the previous answer, JV income goes down if there is dividend. So, we either get that in the form of consolidation of JV income or in the form of dividend if it is distributed. Okay, so that is one reason why you will see movement in JV income. And the LNG business in Dhamra is ramping up. So, there is certain increase in profitability of Dhamra operations. So, that is the reason why there is JV component difference.

Can we get the volume break up in International Ports - individual volumes for Haifa, Tanzania, Colombo? And on RORO car export volumes from Mundra Y-o-Y or Q-o-Q?

So, Haifa in this quarter, in the first half, actually, we did about 5.25 million, and in Tanzania, we did about 7 million, and Colombo we did about 5.5 million.

On Dhamra - margins are a bit impacted Y-o-Y. Liquid volumes are typically high margins. Is it because of substitution between coastal coal or EXIM coal? What is the extent of margin differences? Should we expect Dhamra margins around these levels or are there levers to improve?

No, so there is no difference between EXIM and coastal coal. It is all actually priced, as far as we are concerned, on the similar footing. Of course, there is some price differences between the players with people with assured volume. We have slightly aggressive pricing, because they have commitment of take-or-pay. For us, it's all the same. Dhamra margin, I think you will find improvement even in Q3 and Q4 as we go forward. So, we have taken some one-off repairs and maintenance, and also the cargo mix in this quarter. We don't have much of an iron ore as much as we would like in this quarter. So, therefore, actually, what you are seeing is not representative. 50% should go up to our normal levels in time to come.

Going forward, with non-Mundra share increasing with significantly lower margins, what is the outlook for the Domestic Port margins profile?

So, we are working on two things, and we are demonstrating it month on month. First is the revenue optimization. Revenue optimization is done by getting more and more volumes, more and more customers with the capacities which we have, and this is which we are demonstrating. But the second most important is our operational excellence on the cost platform. You would have seen with our data that we are keeping our cost per ton almost flat, net of inflation. At the end, our focus is to increase the revenue and optimize the cost as much as possible. And this is the reflection on the EBITDA percentage, which you are seeing month on month.

On the Other Logistics margin - it has seen a quarter-on-quarter improvement. What should we take as a sustainable margin probably 2 to 3 years down the line? Also any update on NQXT acquisition?

So, we did say, I think in the last quarter, if I am not mistaken, we are talking about over a period of time, Logistics business to give 40% to 45% margin on the non-IFN and the non-trucking business. So, we will work towards it. Obviously, that is when we actually have all stable operations, but for foreseeable future, we expect gestating business to be in the portfolio. On NQXT - we are waiting for that last approval, which we were and we have been for a while now. So, as you know, it is actually from the Department of Government in Australia. So, it's not particularly time-bound, but at the same time, I can also tell you it's progressing smoothly. So, it should happen soon.

On capacity expansion plans - from a medium-term perspective, especially for Hazira, Dhamra, and Mundra, can you put numbers on medium-term capacity? Any congestion at Mundra given media articles?

Sure. So, I think exports today, we are running, we have a capacity of 633. The next 5 years, we will take up the capacity between 1.1 to 1.2 billion metric tons. And these capacities, the investment, which we have declared of INR 45,000 crores to INR 50,000 crores will be for the ports. And these investments will be done, or are being done, like Vizhinjam Phase-2, we already announced; Kattupalli, we are already doing; Hazira, we are already doing; Dhamra, we are doubling the capacity. We are putting up rails, we are putting up warehouses, and so on and so on. Then the allocation of these capex will be driven by number one, commodity trajectory, linked with the trade. We do believe that containers will attract the maximum trade growth. The second is driven by energy infrastructure, which is mainly the dry cargo, which is coal or cement or steel. And the third one, the Chemical industry, the liquid. APSEZ policy has always been be ready with the supply, so that when demand comes, we can deliver the best-in class customer satisfaction with the minimum turnaround time.

Just a clarification - at any of our ports, there is no congestion and operations are functioning extremely smoothly. We are not losing volumes because of port congestion. Is that fair?

Yes, you are right. We maybe running 90%, 92% of our utilization on some of the ports, but we have enough capability and capacity to welcome each and every cargo which comes to our port.

On Domestic Port margins - on a sustainable basis, where can we see these margins heading? We are already at 74%. As you add new capacities, do you think that will have a near-term or temporary impact to margins?

Yes, it is in that ballpark, 75%. I know 75% is what we have shown this year, or this quarter, both, YTD, and we expect that to be somewhere in the region of 75% to 77% whenever we are able to, over a long period of time, whenever we are able to get our operating efficiencies up and pricing continuing this way.

On cash flow conversion - it was very impressive in the first half at 85%. Can you give us a sense how we should think about that for the full year?

It's the same, Manish. There is neither significantly lower or higher cash conversion that happened. We don't have much receivables or inventory in our business. So, cash conversion should be very similar to what you see in the first half.

At a high level as we go into '27, how should we think about Domestic, International, Logistics and Marine?

We will keep this target of Domestic, which is growing between 1.6x to 1.8x of the trade. I do believe that trade will come back to 5.5% to 6%. Then I think I am especially very much bullish on container. Next year, we will open up our new capacity in Mundra, which is going to be huge one. Then I would say that the power demand in our country will still keep on growing, but replacement of imported coal by coastal coal will go on. And the third one is what we see clearly in 2027 - the redefinition of supply chain for HSD and these kinds of liquids. Now, when we come to International, we have pulled ahead the start of Phase-2 in Colombo, because we are much ahead of the plan, not only volume, but also the margins. Tanzania, we already decided to invest in the elongation of the berth. Haifa, we have enough capacity with what we have seen now the peace agreement and so on. And then finally comes Australia, which is already in. We should be consolidating in few weeks or few months and then Australia will kick in. But on the Logistics, with our strategy of asset heavy, asset light, and asset zero, we keep on thinking and there's a huge opportunity in India about Logistics. And then finally the Marine. Marine, I think India, we are already at 75% market share. We will not go beyond that. But we are adding as we announced 8 tugs in the next 2 years. But yes, on the offshore, we have entered West Africa, but we want to enter Southeast Asia.

Considering APSEZ has signed 2 MOUs with JNPA for Vadhavan Port, how do you see yourself in that light, considering competitive intensity from other peers? And could you throw some light on CAPEX guidance for International Ports specifically?

Okay. So, 2047, India wants to build 10 billion metric ton. And we say that by 2030, we should have 33% market share. So, by 2047, if you are looking at 33% market share, we should be roughly 3.3 billion metric ton. And I just said that in next 5 years, we will be 1.2 billion metric ton. So, all these projects, Vadhavan, then Galathea and so on, are the greenfield projects which will bring that kind of catchment area and that kind of volume potential. And as you would have seen that we have already signed the non-binding MoU for the exploratory studies for the Vadhavan. So, we are very closely involved, and we will follow the tendering process and the selection and so on in the coming thing.