ABB India Ltd — Q3 FY26

ABB India Ltd Q3 FY2025-26 Earnings Conference Call https://www.youtube.com/watch?v=WKn8pWYgpVc Published: 2 months ago

0:01 1 second Ladies and gentlemen, good day and welcome to ABB India Limited's quarter 4 October to December quarter CY 2025 0:10 10 seconds earnings call conference call. As a reminder, all participant lines will be in the listenonly mode and there will be an opportunity for you to ask questions 0:19 19 seconds after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing star then zero on 0:28 28 seconds your touchstone phone. Please note that this conference is being recorded and any unauthorized recording of this call 0:35 35 seconds is strictly prohibited. The recording will be made available on the companies and seb website subsequently. I now hand 0:44 44 seconds the confidence over to Mr. TK Shrether, chief financial officer of ABB India Limited. Thank you and over to you sir. 0:55 55 seconds Thank you Michelle for uh organizing this. So very very good morning to all of you. Welcome to the uh Q4 2025 uh 1:05 1 minute, 5 seconds investor talk and this also is the full year for ABB. So along with me on the call I have Sanjiv Sharma managing 1:11 1 minute, 11 seconds director of ABB India Limited. I have Kiran and Ganesh who are from electrification division and also I have 1:19 1 minute, 19 seconds Sanji Vura leading the motion and also we have this time Balaji for process automation. So I think not wasting a minute now Sanji over to you. 1:31 1 minute, 31 seconds Thank you sir. Uh good morning to all of you. Thanks for joining this call. 1:37 1 minute, 37 seconds Um we will give you uh some business highlights followed by sizer supporting the financial highlights. 1:46 1 minute, 46 seconds uh what we uh do we have a slide before this and what is do we have I think this is 1:54 1 minute, 54 seconds basically the other so so we'll we'll kind of highlight to you the uh you know the again for the 2:02 2 minutes, 2 seconds people who are you joining us for the first time that ABB group is a 140 year old company uh which has sustained 2:11 2 minutes, 11 seconds itself over various industrial cycles And the core reason for that is that it's an innovative company keeps on uh 2:21 2 minutes, 21 seconds rediscovering itself uh based on how we add productivity and value to our customers. India. Uh in India, ABB is 2:30 2 minutes, 30 seconds present and manufacturing for over 75 years and um and uh and and our 2:37 2 minutes, 37 seconds expertise uh uh in the portfolio is on the electrification and automation and 2:44 2 minutes, 44 seconds these are the sweet spot in terms of how the world is developing and how India is developing in terms of electrifying 2:53 2 minutes, 53 seconds everything and also automating everything. So that that's where our portfolio is positioned. We have a substantial footprint. We operate out of 3:02 3 minutes, 2 seconds four manufacturing locations spread across the country. Uh we have 28 sales offices to reach out to and even getting 3:10 3 minutes, 10 seconds deeper penetration with 750 plus partners. We have 25 shop floors which 3:18 3 minutes, 18 seconds have distinct product manufacturing and we are exporting to 30 countries uh from India. Now when you look at the business 3:28 3 minutes, 28 seconds highlights uh CY 2025 it has been uh you know a very 3:36 3 minutes, 36 seconds consistent growth as connected with our previous years. uh we had the highest 3:43 3 minutes, 43 seconds ever orders at about 14,115 kores which was 8% growth but if you 3:51 3 minutes, 51 seconds look into caggr growth from 21 onwards it has been 16%. 3:58 3 minutes, 58 seconds uh our backlog is at the strongest at 10,471 Kores which has grown by 12% and if you look into CAGR for last 5 years is 21%. 4:11 4 minutes, 11 seconds Our revenue grew by 8% to 13,200 crores 4:16 4 minutes, 16 seconds and CAGR of five years is 17%. And PBT uh at this in 2025 was 22,230 crores with a margin at 16.9%. 4:30 4 minutes, 30 seconds And if you see our CGR, it has been 39%. 4:34 4 minutes, 34 seconds And profit after tax is uh 1,669 K. If you look into the EPS, it grew by 4:43 4 minutes, 43 seconds 33% CGR over last 5 years and currently at 78.78 4:50 4 minutes, 50 seconds Indian rupees and the final dividend declared and approved by board is at 29.59 per share. So return on capital employed 4:59 4 minutes, 59 seconds is 21% which is uh which is something we feel good about in terms of how we manage our businesses which are 18 5:08 5 minutes, 8 seconds businesses operating in 23 market segments. Next slide please. 5:16 5 minutes, 16 seconds If we focus on quarter 4 CY 2025 financial performance we had a growth of 5:24 5 minutes, 24 seconds 52% order growth in this in this particular quarter and 27% base business 5:31 5 minutes, 31 seconds growth uh in this quarter. So this is something we are very encouraged after few quarters prior to it which were not 5:40 5 minutes, 40 seconds as strong because the market was taking a breather over which after after five 5:48 5 minutes, 48 seconds years of strong growth. Now we have some good signs in last quarter and we'll continue to see the market building up 5:56 5 minutes, 56 seconds in the quarter we are presently and also going forward. But at the same time when you join us quarterto quartarter in 2026 6:04 6 minutes, 4 seconds you will be able to observe how the market and our goes on top of it. Now if 6:12 6 minutes, 12 seconds you really look at the uh innovation and investments we are doing we are continuing to expand our portfolio in 6:20 6 minutes, 20 seconds different business divisions and we added a new line for energy efficient efficient drives and also we had a 6:27 6 minutes, 27 seconds launch of next generation machinery drive. So when we do these kind of uh you know introductions in the market one 6:36 6 minutes, 36 seconds is we do localization and also it opens up new market segment and also it gives much more deeper penetration into the 6:44 6 minutes, 44 seconds existing customer base. So that's where you can see our businesses continue to compound growth year over year. Uh on 6:53 6 minutes, 53 seconds sustainability side, we were very proud that in ABB India is only the fourth company in India to receive AWS gold 7:02 7 minutes, 2 seconds certification for water stewardship with stakeholders for Nella Mangla facil facility. So this shows um that we are 7:11 7 minutes, 11 seconds very conscious of our role in sustainability in practice and as a management team we do it because it's 7:19 7 minutes, 19 seconds the right thing to do in a country like India and also in the locations we are present. Our ESG initiatives are 7:26 7 minutes, 26 seconds covering 51% of our supplier and we continue to receive different recognition and the latest was from Griha for sustainability excellence and 7:35 7 minutes, 35 seconds national stock exchanges ESG leader rating. Next slide please. 7:42 7 minutes, 42 seconds So strong order momentum across mode segments was visible. Uh namely uh you know the top of those uh charts were 7:51 7 minutes, 51 seconds transport building and infrastructure discrete process automation or other process industries renewables and data 7:59 7 minutes, 59 seconds centers. So with this we have a order backlog of 10,471. 8:05 8 minutes, 5 seconds And you can see that there's a market segment where we have momentum. These are the sweet spot industries for the country and they have a long runway 8:13 8 minutes, 13 seconds ahead of us uh in terms of the growth and we and and I think our customers like our products, they like our 8:21 8 minutes, 21 seconds technology and they also have good relation and deeper relationship with our uh our businesses and we are very 8:30 8 minutes, 30 seconds confident we continue to grow as these market segments and country grows. 8:37 8 minutes, 37 seconds Now if you see uh the kind of breadth of wins that we get in the market, it gives you the diversity of the customers and 8:45 8 minutes, 45 seconds diversity of our portfolio. It plays out like for example we gave rectifier solutions for reliable stable ultra high 8:54 8 minutes, 54 seconds DC power for a large infrastructure and manufacturing major. We supplied low voltage switch gear for a data center 9:01 9 minutes, 1 second major. So that's because you know then in data center most of the computing power a lot of energy connected to it 9:10 9 minutes, 10 seconds and our low voltage switch gear and the medium voltage switch gear behind it enables it backed up by our UPS systems 9:17 9 minutes, 17 seconds and also on the utility side when you have the air conditioning and cooling been done our motors and drives they 9:24 9 minutes, 24 seconds participate in a significant there uh there there and propulsion systems for Indian railways so that's Another 9:33 9 minutes, 33 seconds area wherein government of India has pl long plans and we see a long runway for us there. And of course uh electric 9:41 9 minutes, 41 seconds power train solutions for metals and major uh metals major wherein we combine drives and motor capabilities to give a 9:49 9 minutes, 49 seconds solution which is most optimum and helps in save lot of energy for our customers. 9:56 9 minutes, 56 seconds Same thing in the ethyline cracker in a petrochemical project. uh we had uh a a 10:03 10 minutes, 3 seconds local scope integration and also robotics for a newly formed automotive company of an established industrial 10:10 10 minutes, 10 seconds major for an auto major. So this is something with the established players as well as new players they're imposing 10:17 10 minutes, 17 seconds lot of confidence on us to supply them the robotic solution. 10:22 10 minutes, 22 seconds The one of the um important recipe for us to grow is to have a continuous customer engagement with the existing 10:30 10 minutes, 30 seconds customers and also undiscovered customer, undiscovered geographies and that has been our drum beat in last many 10:37 10 minutes, 37 seconds years and that continues to expand us in multiple new market segments deeper penetration in geographies and also new 10:46 10 minutes, 46 seconds applications uh which were not available in the country but now with the entrepreneurs bringing in lot of uh 10:54 10 minutes, 54 seconds value ad into the country. We continue to grow these market and most of the customers should be aware of our products and solution but we make sure 11:02 11 minutes, 2 seconds they are very comfortable with our offerings and they appreciate what we can do for them. 11:08 11 minutes, 8 seconds Now as we have been mentioning to you uh next slide please 11:16 11 minutes, 16 seconds that these are the 23 diverse market segments we we indicate to you every time uh emerging industries in our case 11:25 11 minutes, 25 seconds are renewables electronics data centers infrastructure and transport and the core industries and these are the places 11:32 11 minutes, 32 seconds wherein lot of activity is taking place and uh and we find that we have a very good suite of industries to play for our 11:41 11 minutes, 41 seconds journey forward. We are very long on India and we stay very consistent with what we supply to these customers. 11:49 11 minutes, 49 seconds Whether a particular market segment is up or it is down for a period, our ability to serve them stays unchanged. 11:58 11 minutes, 58 seconds So we serve the segments which are up or down. We don't chase up argument and neglect. So that's the reason we have 12:07 12 minutes, 7 seconds very consistent um relationship as well as loyalty from our customers across 12:13 12 minutes, 13 seconds these segments. Next one, India Europe trade agreement FTA has 12:21 12 minutes, 21 seconds been signed. Of course there are lot of projections what can happen and what will it will mean. It will take some 12:28 12 minutes, 28 seconds maybe six months or so. I met some people over the weekend who were involved in these kind of uh agreements 12:36 12 minutes, 36 seconds more mainly from EU side. So they are very upbeat about it and they believe it will take another five six months before 12:44 12 minutes, 44 seconds this gets ratified and then you know we will start seeing the benefits of it. 12:50 12 minutes, 50 seconds These are some projected benefits but I would say one should wait and watch. 12:55 12 minutes, 55 seconds Whenever such FTAs happen, it has a it becomes a two-way street and more confidence gets developed on the both 13:02 13 minutes, 2 seconds sides and that is always a net positive for India. In my opinion, I think it will be net positive for ABB India in 13:12 13 minutes, 12 seconds terms of our ability to deploy more portfolio, serve industries better and also integrate back our supply chains 13:19 13 minutes, 19 seconds back into the EU wherein we have a very large manufacturing and technology base. 13:25 13 minutes, 25 seconds But let's wait and see. It's a positive impact that we should factor for future and we have factored it for future. Next 13:33 13 minutes, 33 seconds one, Indian Union budget 26 27. Um, I think we do believe there is a lot for emerging industries which is our focus. 13:42 13 minutes, 42 seconds There's lot for infrastructure and transport and there's lot for core industries and this is something which will play out as we uh go forward. It 13:51 13 minutes, 51 seconds may take uh it doesn't play out quarter to quarter. It plays out in quarter one year, two years, three years. So that's something we are very positive about 14:00 14 minutes because this is something which is forming the industry and the market in front of us. So we have good confidence 14:07 14 minutes, 7 seconds to invest in our capacities as well as our capabilities to serve these market that will expand in front of us. 14:15 14 minutes, 15 seconds When it comes to sustainability in practice, we are very proud of uh the achievements our team has achieved 14:22 14 minutes, 22 seconds across all our locations and and our kind of a focus wherein you can see that 14:29 14 minutes, 29 seconds the we have reduced our GSG emissions by 87% zero waste to landfill. uh we we four 14:38 14 minutes, 38 seconds units have re achieved it four locations water positivity units four locations have achieved it and water recyclability 14:45 14 minutes, 45 seconds is at you know 44%. So ABB India is a fourth company in India as I mentioned uh which has received the AWS gold 14:54 14 minutes, 54 seconds certification and those of you who happen to visit us anytime I think you'll be able to experience this firsthand what it means this is not we 15:03 15 minutes, 3 seconds do for uh powerpoints we do it because it's the right thing to do and you can and our customers experience it when 15:09 15 minutes, 9 seconds they come here and most of our customers really value this because they themselves are trying to uh implement in their locations and they have a very 15:18 15 minutes, 18 seconds deep dialogue with us apart from our products and solutions how we we can co-artner uh to make sure that the sustainability initiatives are not only 15:27 15 minutes, 27 seconds in the in ABP but they are also with the customers and also with our suppliers and we are also very proud that our 15:34 15 minutes, 34 seconds products itself contribute when the client implements these products in their plants and machinery it reduces the energy consumption which has a 15:43 15 minutes, 43 seconds direct and indirect uh impact on the GSG emission of our customer. So we are very quite quite happy about uh the overall 15:52 15 minutes, 52 seconds focus we have in this area. Our CSR initiatives um they are across education and skilling, diversity and 16:00 16 minutes inclusion and communities and environment. We have very clearly defined impact zones where our presence is felt and our central team as well as 16:10 16 minutes, 10 seconds our location team in Nashik, Parisabad, Buroda, Nella Mangla in Pina they find 16:18 16 minutes, 18 seconds projects nearby and also far from far far far area to make a big impact in this. We have been spending 100% of our 16:28 16 minutes, 28 seconds CSR allocation in last 10 years and we continue to make sure it works and since our margins have expanded over a period 16:36 16 minutes, 36 seconds of time our CSR spend also has uh expanded over a period of time. 16:43 16 minutes, 43 seconds Factors that we are watching out for 2026 uh I think there are more positives uh which are domestically held. One is a 16:52 16 minutes, 52 seconds economic power that we are unleashing uh at the at the India level. Green energy and sustainability is a very strong 17:00 17 minutes momentum in the country. Urbanization and smart infrastructure again has a good momentum. Consumerism and lifestyle 17:08 17 minutes, 8 seconds upgrade with the premiumization is something which is very visible even for our portfolio. uh we are not compared 17:16 17 minutes, 16 seconds our customers don't compare us with the relatively lower brands and the cheaper products uh they are always looking for 17:23 17 minutes, 23 seconds us uh when they really want a reliable available serviceable solution so that shows that there's a confidence in ABB 17:32 17 minutes, 32 seconds products and offering and this is not only limit to tier one cities we see a very sustained demand in tier 2 and tier 17:39 17 minutes, 39 seconds three cities where in the aspirational entrepreneurs as well as aspirational class really demands best of the 17:46 17 minutes, 46 seconds products automation and AI there again a lot of work being done and our customer can experience lot of services which are 17:55 17 minutes, 55 seconds based on AI and the machine learning solutions we have a suite of products which are being used across the mainly 18:03 18 minutes, 3 seconds out of automation division and the downside which all of us know and I think nobody's prepared across the globe 18:10 18 minutes, 10 seconds is about the global uncertaintity which again If you really look into the history of time, uh that never goes away. It keeps coming back one way or 18:19 18 minutes, 19 seconds the other. And all what we had to do is to learn how to deal with it. And being having seen s certain cycles in our 18:27 18 minutes, 27 seconds lifetime. I think we are well prepared to deal with the we experience what forex 18:35 18 minutes, 35 seconds fluctuation, volatile, commodity fluctuation, some kind of crossber topic. But we have seen those cycles and 18:43 18 minutes, 43 seconds we know how to adjust whenever that gets elevated. So with this uh thanks uh thank you for listening to me and I'll 18:50 18 minutes, 50 seconds hand it over to PKA to provide you more financial highlights and later we'll come back for questions. Thank you. 18:58 18 minutes, 58 seconds Thank you Sanjiv. I think this summary was very important for us to understand how the markets are playing out and what are the factors which are going to drive 19:06 19 minutes, 6 seconds and uh sort of what we need to watch out for. So on this I think I go to the next slide which is a summary for Q425. 19:13 19 minutes, 13 seconds Uh a strong quarter in terms of orders base orders up to 87 percentage and we also had the benefit of large orders 19:21 19 minutes, 21 seconds which was there and that's why we should see 52%age and these were these orders which were something which um uh which 19:28 19 minutes, 28 seconds were delayed in the last two quarters. I remember the two quarter calls where we were mentioning that the decisions have been delayed and it's something which is 19:36 19 minutes, 36 seconds not um uh uh which is not missed out and this is something which is proving that uh order backlog uh clear 10,400 crores 19:46 19 minutes, 46 seconds of order backlog good visibility for the future revenues and um 70% I mean um out 19:53 19 minutes, 53 seconds of this 10,400 uh 30 35 percentage is large orders which get executed over a period time 20:00 20 minutes not in the next year itself and then we have uh the base orders which will form the rest of it which will get executed 20:07 20 minutes, 7 seconds over the next few quarters as we see uh revenues uh 6%age uh 3,557 crores I 20:15 20 minutes, 15 seconds think um it was a good catch up after we had and good festival period in between uh in October and November so I think we 20:23 20 minutes, 23 seconds could still meet a six personal is what we see uh profitability 15.4 4 and PBT 20:29 20 minutes, 29 seconds at 16.2 and PAD at 12.2 and we have a cash balance of 5,694 crores. 20:35 20 minutes, 35 seconds Profitability I think um uh we know that uh uh we are higher on the material cost at this point of time. We are at 61%age 20:44 20 minutes, 44 seconds compared to 58%age levels of what we were earlier. So I think there are broadly the reasons are um a I think 20:51 20 minutes, 51 seconds first of all um we are we consciously took a decision in the beginning of this year to use important material uh to 20:58 20 minutes, 58 seconds address the QCO concerns and it was a strategic uh decision and that has proved to be beneficial for us and that we could see that because of this 21:07 21 minutes, 7 seconds reliability we are also able to uh have a good base order growth because customers believe that we will be able to we will stay resilient in these 21:14 21 minutes, 14 seconds circumstances as well and um That's something which has definitely a reason to push up the material cost and also we 21:22 21 minutes, 22 seconds have the forex and the copper and metal prices which are going up at this point of time and so that has uh probably led 21:29 21 minutes, 29 seconds um uh to the higher uh material cost uh and the and the uh mix of orders mix of 21:36 21 minutes, 36 seconds orders between projects products and services as well. So I think all this put together um uh has basically caused 21:43 21 minutes, 43 seconds this material cost to increase and we should also understand um uh that 23 and 24 were those periods where uh demand 21:52 21 minutes, 52 seconds was higher than supply because it's an execution of the pent-up demand of the covid period and that gave us a leverage to have a price premiere in the market 22:02 22 minutes, 2 seconds and that's something which is now getting stabilized and therefore uh we have uh the scenario as what is playing on a material cost. So, and there is uh 22:11 22 minutes, 11 seconds a good part of that there has been uh uh no uh one-off cost in terms of uh any surprises on the material cost. This is 22:20 22 minutes, 20 seconds something what we believe this should be the right level. That's what we see. Cash of course it has been pretty clear. 22:26 22 minutes, 26 seconds The next is IATA margin. So, we are at 15%age. So, I think uh we will slowly move into the uh commentaries on margins 22:34 22 minutes, 34 seconds going forward as well. and uh profit before tax is 16%age compared to the uh levels what we were last year to what we 22:42 22 minutes, 42 seconds are today and uh of course Pat and uh EPS we eluded upon uh during these discussion the next slide is around uh 22:51 22 minutes, 51 seconds structural analysis of PNM so I did I definitely told about material cost I would not repeat upon it now the personal expenses include a 65fold 23:00 23 minutes impact of labor code and uh that's something which we thought uh should be taken in the other not as an external 23:07 23 minutes, 7 seconds item but as an part of the uh normal expenses because uh we believe that it's a part of the um normal revision what 23:16 23 minutes, 16 seconds happens to personal expenses and and we believe that it's better to be conservative about taking an item uh to show a better uh profitability per se. 23:24 23 minutes, 24 seconds So but otherwise I think um uh there are no just surprises. Uh there has been uh we of course got an advantage because of 23:32 23 minutes, 32 seconds the marktomarket uh gain on account of commodity derivatives which had to be done and if you look on exactly um two 23:41 23 minutes, 41 seconds quarters before we were hit by the exchange rate at that point of time but on overall basis for the year I think we 23:47 23 minutes, 47 seconds are quite nominal of 23.7 crores gain which is just 2% the total profit. Yeah. 23:54 23 minutes, 54 seconds So just alluding to a bit of more on the um wise details. Uh electrification a front 24:03 24 minutes, 3 seconds runner on the growth uh 43%age up compared to the previous year. Of course they had an good order from and uh data 24:11 24 minutes, 11 seconds center as well in this particular quarter which held up the ladder. But of course the other thing is the base orders uh stood up uh to gain that 24:19 24 minutes, 19 seconds particular fraction. uh revenues a 60%age growth strong order backlog uh 3,300 crores roughly and a profitability 24:28 24 minutes, 28 seconds of 21.4 four and of course it's uh something which also had to do with the QCO interp profitability and the impact 24:35 24 minutes, 35 seconds on the forex motion uh mobility order from the transportation sector really helped over here again uh so and while 24:44 24 minutes, 44 seconds on motion I would like to clarify um that does not include the titer order which was announced in the month of 24:51 24 minutes, 51 seconds February and uh that is something which will form part of the Q1 2026 performance uh so we are 25 percentage 24:59 24 minutes, 59 seconds on the orders, 7%age on revenues and strong order backlog of 4,200 but they also have large orders of uh railways 25:09 25 minutes, 9 seconds which will get executed over a period of time. their profitability constant at 16.5. Um automation um they were they 25:17 25 minutes, 17 seconds were a bit subdued in the last few quarters uh in this in this quarter those orders which were delayed as what Balaji was mentioning earlier as well 25:25 25 minutes, 25 seconds that opportunity pipeline is there but what is happening is the decision on the orders sometimes get delayed and that's something which got decided in this 25:34 25 minutes, 34 seconds quarter and therefore we could see a good growth of 34%age on the orders. uh this this has that means there's a good backlog which gets uh capable of 25:43 25 minutes, 43 seconds execution the coming quarters so strong margins I would say for PBIT at 14.7 and that's probably from uh because list of 25:51 25 minutes, 51 seconds services as what we see robotics I think uh uh they also grew definitely higher 570 crores for the quarter uh and it 26:00 26 minutes also had an time uh large order from automotive sector and revenue slightly lesser 5 percentage uh backlog of course 26:08 26 minutes, 8 seconds uh very strong compared to what it was in the few in the last few weeks because of the large orders what they got and profitability definitely higher. So last 26:17 26 minutes, 17 seconds slide I think u uh I think this is something which we show constantly to understand uh how do we operate so and e 26:26 26 minutes, 26 seconds is almost 43%age of the uh total order book total revenues what we have 35%age 26:32 26 minutes, 32 seconds from motion 18 and 5%age of pa and uh uh robotics to mention uh products we are 26:40 26 minutes, 40 seconds definitely high on the products so we are 79%age this year is products uh business And that's because probably uh 26:47 26 minutes, 47 seconds process automation was slightly lower in revenues and that is the that is one of the reasons for this and uh uh so and 26:55 26 minutes, 55 seconds channels to markets OEMs and EPCs and definitely are the and the end users are definitely the four market channels we 27:02 27 minutes, 2 seconds have channels to market they are performing in line with what we export and the businesses which we are doing 27:09 27 minutes, 9 seconds geographically 11 10% of exports because we see domestic growing faster and that's and also So we had bit of a 27:17 27 minutes, 17 seconds global uncertain topics to deal with initially and so but still I think 10%age on a higher base of 2024 on 27:24 27 minutes, 24 seconds exports and 90%age domestic is definitely a stronger uh performance to say yeah so yeah so this is this is 27:33 27 minutes, 33 seconds basically the insights on how the financial insights so I was able to cover in 10 minutes per se so I think uh we can start to take the questions at least with 30 minutes for us today. 27:44 27 minutes, 44 seconds Thank you very much. 27:46 27 minutes, 46 seconds Thank you very much sir. Ladies and gentlemen, we will now begin with a question and answer session. Anyone who wishes to ask questions may please press star and one on their touchstone phone. 27:56 27 minutes, 56 seconds If you wish to withdraw yourself from the question, you may press star and two. Participants are requested to use only handsets while asking a question. 28:06 28 minutes, 6 seconds Ladies and gentlemen, we will wait for a moment while the question assembles. 28:24 28 minutes, 24 seconds The first question is from the line of Reu Begalia from IIFL Capital. Please go ahead. 28:31 28 minutes, 31 seconds Yeah. Hi uh good morning team and congratulations for the strong results. 28:35 28 minutes, 35 seconds Uh my first question is um Sanjiv if you look at the order flows excluding the automotive large order in ARO your broad comments still have been fairly positive 28:44 28 minutes, 44 seconds on the ordering environment um as we look for CY 26 um uh given that Metro order also we've announced for Jan um 28:51 28 minutes, 51 seconds how should we look at the order info momentum heading towards the next calendar year and in general um what is uh what are your views on the broad 29:00 29 minutes investment sentiment have they improved uh they're still same they're expected to accelerate over the on that's the first question and second um our margins 29:08 29 minutes, 8 seconds for last year were for annualized basis were about at 16% excluding the impact of the new labor code um and now that 29:16 29 minutes, 16 seconds incrementally um demand outlook and volumes are looking better um how should we look at the margin environment for 29:24 29 minutes, 24 seconds the next 12 15 months um can we expect margins to improve have they bottomed out or they likely to be rangebound the 29:31 29 minutes, 31 seconds way they have been for the last three to four quarters Hi, I can take the first part. Thank you 29:38 29 minutes, 38 seconds Renu. Thanks for the question. Second part SA you can look into future and give an answer. So as far as demand 29:45 29 minutes, 45 seconds outlook is concerned, it definitely looks positive as confirmed by the business leaders uh who are running 29:53 29 minutes, 53 seconds different businesses. So when we look into the aggregate demand outlook for ABB India, what it really means is how 30:00 30 minutes is the demand outlook for each of the 18 businesses. So we are the sum total aggregate sum total of all the 30:08 30 minutes, 8 seconds businesses. So uh right now we feel that there is a demand building up after a after a breather in early quarters of 2025. 30:18 30 minutes, 18 seconds uh at the same time it is never uh good idea to declare a victory or declare a 30:25 30 minutes, 25 seconds trend with one quarter results. We shall uh you know continue to watch how the quarter 1, quarter two, quarter 3, 30:33 30 minutes, 33 seconds quarter four builds. I think that will show very clear indications how the how sustainable and how resilient the uh 30:41 30 minutes, 41 seconds markets are. But as we look into our customer engagements and also the market segment engagement, it seems to be 30:49 30 minutes, 49 seconds moving in the right direction in our view. 30:53 30 minutes, 53 seconds This could be the key end markets which are uh driving this. 30:59 30 minutes, 59 seconds Uh so if you go into our chart uh wherein you see uh you have a spread of emerging market infrastructure as well 31:07 31 minutes, 7 seconds as the core industries. So emerging market segments are going really very strong and also the middle segment which 31:16 31 minutes, 16 seconds is infrastructure there again we have good traction and poor industries which were kind of uh uh I would say muted in 31:25 31 minutes, 25 seconds past but that forms about 52% of our volumes we are seeing good green shoots and good signs there there's a good mix 31:33 31 minutes, 33 seconds of orders coming from the core industry especially metals uh as well as uh you know u uh in the in the chemical 31:41 31 minutes, 41 seconds oil and gas and other market segment in the core segment. So that we are seeing investment profile increasing in the core segment as well and that segment 31:50 31 minutes, 50 seconds though it is low growth for last many quarters given that it is 52% of our volume if that moves it moves us quite 31:58 31 minutes, 58 seconds well. So so it's a combination effect of all the three core areas that we focus on there. Thank you. 32:06 32 minutes, 6 seconds Yeah. 32:07 32 minutes, 7 seconds Thank you. Thank you Sanj. So uh I know to call on your uh question for the uh 32:13 32 minutes, 13 seconds um margin thing is that 32:23 32 minutes, 23 seconds excuse me sir you're not audible right now we can't hear you. Yeah, we lost you. 32:31 32 minutes, 31 seconds Please hold the line. Ma'am, management is reconnecting now. 32:37 32 minutes, 37 seconds Sir, can you hear us? 32:40 32 minutes, 40 seconds Yeah, we could hear you but in between we dropped. I think uh yes sir, we just again reconnected. Yes sir, please proceed. 32:47 32 minutes, 47 seconds But we couldn't hear anything what you mentioned. Thank you. You may have to start again. 32:54 32 minutes, 54 seconds I will do that. Uh you know not a problem. We were talking about margins. 32:58 32 minutes, 58 seconds I think the profitability and especially on PBT over the five year period we have a good traction of PB at PBT level. So 33:06 33 minutes, 6 seconds today um 2025 we closed it at 16.9%age give and take another 0.5 percentage for the uh labor code impact. So literally 33:15 33 minutes, 15 seconds we're talking of 17.5. Last year we were 20.5 no doubt about it. And I think that gap is more to be um uh attributable to 33:24 33 minutes, 24 seconds the reasons which are not under the the company's control which is of forex and commodity prices and also the increasing um stabilizing of price in the market. 33:33 33 minutes, 33 seconds So therefore the premium what we could normally get um on account of demands of our situation is something which could not be uh which which was not possible 33:42 33 minutes, 42 seconds in uh 2025 and also we at QCO. So now going forward how does this basically pan out? I think I go back to the slide 33:51 33 minutes, 51 seconds which Sanjie said as to what is happening and what is going to be the play in the market. I think there are u 33:58 33 minutes, 58 seconds there is a bit of an uh good view that uh the markets are going to revive with the private capex which is expected to 34:07 34 minutes, 7 seconds uh happen out in the Q4 to in 2026 um thanks to the budgets and also the uh the trade impacts which are giving a bit 34:16 34 minutes, 16 seconds of a positive sign at this point of time. So uh having said that I think what will remain as and risk to manage 34:23 34 minutes, 23 seconds is of course forex and and metal prices right and our ability to respond to the market um with a balanced view between 34:32 34 minutes, 32 seconds how much price increase to do and uh how much we should absorb depends on total market situation as such. So having said 34:40 34 minutes, 40 seconds that I think a trae a trajectory in at the pack level we're talking of between 12 to 15 percentage still feels good 34:49 34 minutes, 49 seconds right and I think uh I believe that uh if we have volumes kitting in more than what we are doing today at six seven 34:56 34 minutes, 56 seconds percentage uh probably that should give us an extra mileage uh to manage and uh do a margin acquisition 35:04 35 minutes, 4 seconds sure and do you think there'll be positive sale impact from rating change for motors from I2 to I3 standards um towards the second half of the year. 35:17 35 minutes, 17 seconds Uh so Sanjie Aurora is with us. Uh Sanjiv did you get the question uh on the I2 and I3. 35:27 35 minutes, 27 seconds See uh uh if if I may get that right then you can please correct me. I think you are talking about that if uh it 35:35 35 minutes, 35 seconds moves from I2 to I3 the minimum efficiency levels for India 35:42 35 minutes, 42 seconds what would be the impact am I right did I get question right okay yes so uh I think thank you uh very 35:51 35 minutes, 51 seconds good and thanks for that uh I think it is high time uh that we mature towards 35:59 35 minutes, 59 seconds I3 and I4 efficiency levels and if it happens a welcome move. Uh because now 36:06 36 minutes, 6 seconds if we talk about India growing not only domestically but also exports uh all the 36:14 36 minutes, 14 seconds majors what you to talk internationally they have all the countries they have moved to I4 as the minimum efficiency 36:21 36 minutes, 21 seconds and if we have to grow on export part your machinery has to have that kind of a motors with that efficiency levels. So 36:29 36 minutes, 29 seconds I think that's much second part is uh that this will not only help uh in uh 36:36 36 minutes, 36 seconds you know improving our exports but also the sustainability and the energy 36:43 36 minutes, 43 seconds efficiency team which is core to ABB's uh I would say one of the pillars of operations. 36:52 36 minutes, 52 seconds So uh with this we can save lot of uh electrical energy which can be utilized for further expansions and uh I think 37:01 37 minutes, 1 second there is a there is a and just to mention that more than 50% of our own productction 37:08 37 minutes, 8 seconds has already moved to I3 and I4 and we have been pioneering this uh efficiency 37:16 37 minutes, 16 seconds theme in India and also have brought i5 technology which is induction technology 37:23 37 minutes, 23 seconds free from permanent magnet already introduced and customers are accepting 37:29 37 minutes, 29 seconds them accepting that with open arms. So that's my take. Uh I hope I I've been 37:37 37 minutes, 37 seconds able to give you the answer. So Reo just to sort of round it up right. So we are 13,000 cr company out of which motors is 37:45 37 minutes, 45 seconds one portion out of it and out of that I35 another fragment of it right. The entire company is just not driven by motors but 37:53 37 minutes, 53 seconds it has 18 divisions right which contribute to the entire volumes of the company and therefore it is an uh sort 38:01 38 minutes, 1 second of an product of all these 18 divisions working together. Can we move to the next slide? Next question please. Thank you. Thank you. 38:10 38 minutes, 10 seconds Thank you ladies and gentlemen. In order to ensure that the management will be able to address questions from all the participants in the conference, kindly 38:18 38 minutes, 18 seconds limit your questions to only one per participant. Should you have a follow-up question, please rejoin the queue. We'll take the next question from the line of 38:25 38 minutes, 25 seconds Atul Tari from JP Morgan. Please go ahead. 38:29 38 minutes, 29 seconds Yes sir. Thanks a lot. Sir, uh would it be possible to uh throw some light on what proportion of your cost of goods is 38:37 38 minutes, 37 seconds imported from EU as of now and what is the weighted average tariffs that you pay on that? 38:47 38 minutes, 47 seconds So I think it's a very operational question right so most of our imports are from EU because all of the factories 38:54 38 minutes, 54 seconds are from EU right so uh I think uh that being the case if you if we are 10% on 39:02 39 minutes, 2 seconds exports in terms of revenues we are almost 20% on imports right so I think uh we are still exposed to um um imports 39:11 39 minutes, 11 seconds and net importer as such so I think that's that's basically what it Okay. Is there any color on weighted beverage tariff that you pay as of now? 39:24 39 minutes, 24 seconds I think that's different on different products depends upon the classification what we have right and I think this is something which is quite uh um I would 39:32 39 minutes, 32 seconds say sensitive information to disclose at this point. 39:36 39 minutes, 36 seconds Okay sir. and such a QCO impact uh has it continued in this quarter because I mean based on the news flows we gather 39:44 39 minutes, 44 seconds that government has kind of rolled back most of the QCO orders or is that a wrong impression? 39:51 39 minutes, 51 seconds Okay. So let me give one answer one bit of the answer. Other thing I will pass it on to Kiran to uh supplement that. 39:58 39 minutes, 58 seconds See we in 2025 we took a strategic decision as what I mentioned to stock our material to cater to our customers 40:06 40 minutes, 6 seconds within from imports right and that imported material will get consumed over the next two quarters right so therefore 40:14 40 minutes, 14 seconds we will have a bit of an higher material cost which we are seen at this point of time. So now coming to the next part of 40:21 40 minutes, 21 seconds the question which is how is the QCO playing out. Uh Kiran over to you. 40:26 40 minutes, 26 seconds Thanks Sher. Um thanks at for this question because it's a very important topic and we have been discussing this particular topic from the past one year 40:34 40 minutes, 34 seconds and there is nothing called roll back of a QC just to make it uh bit understandable. It's actually the timelines which have been enhanced for 40:42 40 minutes, 42 seconds testing. So that's that's the crux of the story. Uh where the government has very clearly indicated that QCO for sure is going to be implemented. No doubt in 40:50 40 minutes, 50 seconds that the first phase is already in flow and most of the companies even the peers and us have already tested our products 40:58 40 minutes, 58 seconds and solutions as per TCO uh norms whatever is the policy and we have already got it done. However, for the second phase of implementation, the 41:07 41 minutes, 7 seconds government has given some more time uh due to the availability of labs which are required and that is where all of all the manufacturers including OBB are 41:15 41 minutes, 15 seconds following this particular process and following the policy of the G. So, it's only the question of timelines. It's not the question of roll back. 41:23 41 minutes, 23 seconds Okay sir. Thank you. Thank you. Thank you. 41:27 41 minutes, 27 seconds A reminder to Thank you sir. A reminder to all the participants to kindly limit their questions to only one. We'll take 41:34 41 minutes, 34 seconds the next question from the line of Omesh Ra from Namura, India. Please go ahead. Please go ahead. 41:41 41 minutes, 41 seconds Yeah. Hi sir. Thank you so much for this opportunity. Uh my first question is pertaining to Mr. Rout. I'm sorry to interrupt you sir. Please use your handset. 41:53 41 minutes, 53 seconds Is it fine now? Yes sir. Please proceed. 41:56 41 minutes, 56 seconds Yeah. My first question pertaining to uh 23 diverse market slide that we mentioned uh where if I look at uh the breakup now uh on a quarteronquarter 42:06 42 minutes, 6 seconds basis uh certain industries have moved towards lower or modest uh mid-term outlook segment especially larger uh 42:14 42 minutes, 14 seconds sectors like auto and food and beverages uh but I think uh despite that uh we are mentioning our outlook as being more of 42:22 42 minutes, 22 seconds optimistic in near term and second uh within these three segments if you can help us uh with the contribution from 42:30 42 minutes, 30 seconds emerging industries and infrastructure and transport. I think in opening comment you have mentioned core industries contributing about 52% to total volumes for the company. 42:43 42 minutes, 43 seconds I will give some light on the contribution. So I go back to what our composition is. 10%age is exports, 90% 42:51 42 minutes, 51 seconds is domestic and this 90%age of our revenues come from uh all these 23 market segments and out of this 90%age I 43:00 43 minutes think 52%age as what you was mentioning is from uh the core sectors and the balance 25 20 23 percentage is between 43:10 43 minutes, 10 seconds emerging sectors and the automated emerging sector. So that's the that's a broad split. It is 23 25 and that's how it is. 43:21 43 minutes, 21 seconds So just to let you know I think your analysis is right. Uh uh but the light is not as linear as we mentioned. What 43:28 43 minutes, 28 seconds happens is when these segments which are so-called emerging they become a larger size rate of grow growth uh the 43:36 43 minutes, 36 seconds percentage rate of growth normalizes they move there but at the same time the size of the industry has become larger 43:43 43 minutes, 43 seconds and also with our strategy and our portfolio expansion we go for higher penetration we also go for more customer 43:51 43 minutes, 51 seconds coverage so then what happens is that also correlates to the net growth rather than a linear 43:58 43 minutes, 58 seconds linearity with the way the segment is moving. Just a follow up on this if you can. 44:06 44 minutes, 6 seconds I'm sorry. So Mr. Ra, I would request you to kindly rejoin the queue for follow-ups, please. We have others who are waiting for their sorry sir. Thank you. 44:15 44 minutes, 15 seconds We'll take the next question from the line of Mohit Kumar from ICICI Securities. Please go ahead. 44:21 44 minutes, 21 seconds Yeah, good morning sir and thanks for the opportunity. Uh my question is can you help us understand the order 44:28 44 minutes, 28 seconds prospect for the data centers are you seeing larger prospects compared to let's say at the beginning of CI25 44:38 44 minutes, 38 seconds we have Ganesh Kotav our ELDS leader as well as Kiran on the call so I'll hand it over to Ganesh how do you 44:47 44 minutes, 47 seconds see uh data center market building up going forward yeah uh thanks for this uh question 44:55 44 minutes, 55 seconds myself Ganesh Kotto I'm responsible for distribution solution business of AB India and uh uh as a it's a very 45:03 45 minutes, 3 seconds emerging uh segment uh to the electrical industry and we see a very strong which 45:10 45 minutes, 10 seconds is coming from the data center and uh there are not only the hypers skills who putting up the data centers but there 45:17 45 minutes, 17 seconds are lot of big Indian houses they also have a very big plan to put up the data centers in India And apart from the big 45:25 45 minutes, 25 seconds hypers scale data center there are many data centers which we see in the pipeline which is coming from the polos also. So in an overall we are very 45:34 45 minutes, 34 seconds optimistic and three a very very strong uh demand and the inquiry pipeline which is coming from the data centers. 45:42 45 minutes, 42 seconds Thank you Ganesh and you know Ganesh supplies directly into data center or to the people who are building those data 45:48 45 minutes, 48 seconds centers and Kiran's portfolio uh that also has a good exposure to data center but that's typically dealt by our 45:57 45 minutes, 57 seconds integrators and channel partners uh how's that building it up for Kiran for the products and the uh solutions our panel builders trans 46:06 46 minutes, 6 seconds thank you Sanjiv um very important question Mo and very uh very interesting an emerging market as well at this point 46:12 46 minutes, 12 seconds of time for us. Uh you have seen the AI summit happening and you know that the data center is going to pick up because 46:20 46 minutes, 20 seconds of this AI summit as well. A lot of uh limelight and a lot of interest being shown by the consumer as well. So uh 46:28 46 minutes, 28 seconds when it comes to uh the the system integrated part or even for the for example for even the direct supplies I think both hypers scale and collocations 46:36 46 minutes, 36 seconds are seeing a very big trend in terms of uh the the the capacities being utilized at this point of time at the same time 46:44 46 minutes, 44 seconds new capacities coming out and we are seeing megawatt capacities now and going towards gigawatt capacities as well in the future. So it's quite a very 46:52 46 minutes, 52 seconds interesting topic at this point of time and um uh and the system integrators are really uh leveraging this um the opportunities what are available in the 47:01 47 minutes, 1 second market and we believe that this is a great opportunity for all of us to get into it and give right solutions and you also saw in the opening comment made by 47:09 47 minutes, 9 seconds Sanji that we have also secured a very large low voltage care order for one of the largest of the data centers in India. So the way to see ABB portfolio 47:17 47 minutes, 17 seconds is that when we say we are focused on hypers scale and the uh midscale data center that is our direct supplies into 47:24 47 minutes, 24 seconds them and what deals with is the all data centers because they are connected close to where our panel builder and our 47:32 47 minutes, 32 seconds channel partners work. So basically we uh cannot cater to the complete bandwidth of the data centers wherein in 47:40 47 minutes, 40 seconds the low end of the data centers we have more low voltage solutions and some medium voltage solutions going but in the midsize as well as hypers scale we 47:48 47 minutes, 48 seconds have the portfolio that flows into and of course uh not to mention the UPS which is a very kind of uh a product 47:58 47 minutes, 58 seconds which is very much liked by the data centers because it's a fault tolerant UPS wherein it can be uh kind of 48:08 48 minutes, 8 seconds serviced online while it is working with 100 kilowatt modules. So there are there's a very good design advantages 48:14 48 minutes, 14 seconds our portfolio has when we deal with the data center segment in the in the different market segments within data center. Yeah. 48:23 48 minutes, 23 seconds Thank one more point. 48:30 48 minutes, 30 seconds Yes, please go ahead. Yeah, because in the recent budget these uh tax holidays up to 2047 is also going to make uh 48:39 48 minutes, 39 seconds India market very attractive to put up the data center for those systems. Understood. 48:45 48 minutes, 45 seconds Absolutely. Thanks. Thanks for pointing that out as well. Thank you. 48:50 48 minutes, 50 seconds Thank you sir. We'll take the next question from the line of Amit Mahavar from UBS Securities. Please go ahead. 48:58 48 minutes, 58 seconds Hey Sanj. Hi. So I just have one question on the um the pace of ordering uh both base and large. Um we we 49:06 49 minutes, 6 seconds concluded CY25 with a reasonable growth of 13% base orders. We hardly had large orders and 49:13 49 minutes, 13 seconds you know you know until the last part of December. Do you think 2026 uh you know 49:20 49 minutes, 20 seconds as a year um you know is a year where you will have not only data centers I can see 15 16 billion in the order book 49:28 49 minutes, 28 seconds now from data centers. That's a large number for you. uh but also from you know metals we have two three other segments where the large order can 49:36 49 minutes, 36 seconds outperform significantly in the 26 period and also in base orders it's been two years that the channel partners have 49:44 49 minutes, 44 seconds been very very conservative which um cyclally looks better now that for exporters in India the trade uh the 49:52 49 minutes, 52 seconds tariff barrier concern is behind the budget was supportive private segment for all the companies that report numbers has been going up. Do you think 50:01 50 minutes, 1 second 26 is a year of very significant shift in the ordering run rate? The last we saw was 3 four years ago. So any comments on both base and large orders with some color. Thank you. 50:12 50 minutes, 12 seconds So since the large orders typically come from our process automation division and also some of the ETO orders in ELDS, 50:21 50 minutes, 21 seconds robotics and many others. So let me give this opportunity to Balaji. Bali, how do you see the process automation or 50:28 50 minutes, 28 seconds automation market at this point of time and how do you see the project pipeline developing in the energy and the process industry side? 50:36 50 minutes, 36 seconds Yeah. Uh thank you uh uh Sanjie um you know from context of 2025 yes I uh stated uh that the markets are quite 50:44 50 minutes, 44 seconds muted until the first of the year and then we started some movements uh uh uh and that resulted in order conversions 50:51 50 minutes, 51 seconds uh you know as well. uh 2026 uh I would say that uh uh uh the momentum is there 50:58 50 minutes, 58 seconds uh there are definitely uh movements uh I think uh uh from an uh specific to say in energy industries that deals with oil 51:07 51 minutes, 7 seconds and gas uh power uh speciality makers and pharmaceuticals we see some very good opportunities in power uh 51:15 51 minutes, 15 seconds especially power generation which has been uh quite low for past few years uh we have a good pipeline of opportunities 51:22 51 minutes, 22 seconds in uh in power generation. Um refining uh is uh uh still strong. Um there are 51:30 51 minutes, 30 seconds good opportunities uh in uh in uh in in refining. So in both these cases we have green field opportunities which means 51:38 51 minutes, 38 seconds these are new projects uh starting up from ground. We also have a good amount of opportunities in the repair and modernization which is an ongoing 51:46 51 minutes, 46 seconds activity. So that should uh cover uh uh uh the the the base uh from the from the 51:53 51 minutes, 53 seconds repair and modernization uh and uh the large orders coming in from uh or opportunities available uh in the in the 52:00 52 minutes green field. Uh similarly in the process industries that deals with metal, mineral, mining these heavy industries 52:08 52 minutes, 8 seconds uh what we also see is there are quite a good of opportunities for the uh for the big ticket items and uh we shall continue to stay close to the customer 52:16 52 minutes, 16 seconds and see how much we can uh convert during this year but overall I would say a positive uh outlook as things stands today. 52:26 52 minutes, 26 seconds Thank you Bali. Thank you. Thank you. Thank you. 52:32 52 minutes, 32 seconds The next Yes sir. The next question is from the line of Samir Takur from Ambit Capital. Please go ahead. 52:40 52 minutes, 40 seconds Uh hi thanks. Uh just to follow up on data center. What is the data center exposure in sales and backlog? Uh have you seen 52:47 52 minutes, 47 seconds any acceleration in interactions uh in data center market? A bit clear on that would be great. 52:57 52 minutes, 57 seconds So data centers actually um you know you get some large orders it becomes large in the pipeline but in the 2025 they got 53:06 53 minutes, 6 seconds a few compared to the uh previous years I think in the uh backlog which we have of 10,441 I think roughly uh 10 11 percentage 53:15 53 minutes, 15 seconds would be data center okay thanks can I just uh squeeze one more uh just uh what's happening in the 53:23 53 minutes, 23 seconds price for different divisions we need what's happening for the uh I mean prices in different divisions 53:31 53 minutes, 31 seconds can comment on the pricing well customers always demand uh lower 53:38 53 minutes, 38 seconds prices that's the reality of life and at what we do is we continue to localize make sure our portfolio is at the right 53:44 53 minutes, 44 seconds cost level and meet the customer's requests but at the same time minimization of the portfolio is taking 53:52 53 minutes, 52 seconds place so we have a good overall all effect. So it's a always a balancing act. Uh and on the pricing side the uh 54:01 54 minutes, 1 second but for one or two uh particular products I we don't see uh as such any critical pressures at this point. 54:10 54 minutes, 10 seconds Okay. Thank you. That was awesome. Let's continue. 54:15 54 minutes, 15 seconds Thank you. The next question is from the line of Shubad Metra from Noama. Please go ahead. 54:21 54 minutes, 21 seconds Good morning and thank you for the opportunity. Uh so this is just a clarification on I think one of the early answers that you gave I think to 54:28 54 minutes, 28 seconds Reu's question. Uh I believe you mentioned 12 to 15% as the sustainable growth number. I'm not sure whether you 54:35 54 minutes, 35 seconds mentioned that as a sustainable margin or the sustainable topline growth number and also on this QCO impact you know 54:43 54 minutes, 43 seconds once the imported stock of materials is done where do you see uh the sustainable margin stabilizing? Thanks. 54:55 54 minutes, 55 seconds So let me uh answer one question when I talked about 12 to 15 percentage I told about the path margin. So that's where I 55:02 55 minutes, 2 seconds said that uh that's something which should be the corridor in which we should move and knowing well uh that we 55:09 55 minutes, 9 seconds have uh QC issues which will have to be handled for the next two quarters that's what we see because that's the material what we have had and and also the orders 55:19 55 minutes, 19 seconds what we will execute in the next uh you know three to four quarters that's what we see right and that's what it is now 55:25 55 minutes, 25 seconds coming to the growth of revenues right so uh growth of revenue at this point of time uh if you look at 55:33 55 minutes, 33 seconds our overall revenues I think we have been growing at uh ALSB at 8% at this point of time so I think if you uh it 55:42 55 minutes, 42 seconds was mentioning uh that the 10,000 per order backlog definitely has the represent of large orders which has got 55:49 55 minutes, 49 seconds executed over the next uh couple of years to come and that being the case so then we need to really book orders in 55:58 55 minutes, 58 seconds the market during 2026 for revenue revenues in 2026, right? So that remains the uh our ability to look uh to look 56:07 56 minutes, 7 seconds good orders and execute them. So I think we will have to make sure that we are able to our target is always to have doubledigit growth on the revenues as 56:16 56 minutes, 16 seconds well. So let's see how it proceeds, how the markets proceed, how these orders get finalized. Thank you. 56:24 56 minutes, 24 seconds Thank you. The next question is from the line of Harshett Patel from Equirus Securities. Please go ahead. Uh thank you very much for the opportunity. 56:34 56 minutes, 34 seconds So my question is on the uh process automation order. Uh this segment has not kept pace with the other two large 56:42 56 minutes, 42 seconds segments in the last two to three years and you have also highlighted the delayed decision making by the customers 56:49 56 minutes, 49 seconds and we have seen that correcting in the last quarter as well. So while the orders in the fork were strong, our 56:56 56 minutes, 56 seconds order book is almost at the same level which was there in 2022. 57:02 57 minutes, 2 seconds So do you think we would have lost some market share uh in the two to three years or we have performed in line with 57:09 57 minutes, 9 seconds the capex environment in this industry and it was just a factor of the delayed decision making just your uh uh thinking 57:18 57 minutes, 18 seconds and the outlook on the so we have performed in line with how 57:25 57 minutes, 25 seconds the segment is developing and uh what we find is that uh There are opportunities 57:32 57 minutes, 32 seconds in the marketplace. We are very selective what kind of projects we do. 57:36 57 minutes, 36 seconds We always go after high quality and somewhere where the value added by us is appreciated by the customers because we 57:45 57 minutes, 45 seconds have lot of domain expertise and specialization in the automation area. 57:50 57 minutes, 50 seconds So uh if you really go back I don't know how far how long you've been following this particular market segment. It's a 57:57 57 minutes, 57 seconds cyclic area and you if you go back 20 years you will find that there is a lot 58:05 58 minutes, 5 seconds of cycles that come and go and typically if you have a cycle which is a down 58:11 58 minutes, 11 seconds cycle. What we do is we continue to maintain the quality of our support to customers. So which shows up in the OPEX 58:20 58 minutes, 20 seconds orders as well as capex orders and also the brownfield expansions. uh so we stay engaged with the customers because we 58:28 58 minutes, 28 seconds are the long-term partners for them but yes last quarter we did see expansion and as Balaji mentioned that we are 58:35 58 minutes, 35 seconds seeing now the pipeline building up nicely and we hope that we can get a fair share of that uh in the coming 58:43 58 minutes, 43 seconds quarters uh thank you and all the best thank you the next question is from the 58:50 58 minutes, 50 seconds line of Mohit Pande from group please go ahead Yeah. Uh good morning sir and uh congrats on a good quarter. Uh sir u 58:59 58 minutes, 59 seconds just wanted to get more color on uh competitive uh intensity in the market. 59:04 59 minutes, 4 seconds Last two quarters you have u you indicated Chinese competition as well and we uh understand some of your 59:11 59 minutes, 11 seconds European competitors are setting up u incremental capacities in India. Uh so in light of that just wanted to u hear 59:20 59 minutes, 20 seconds your thoughts around yeah these So we uh on the competitive intensity I 59:28 59 minutes, 28 seconds think at this point of time is largely domestic of the established players. Now 59:36 59 minutes, 36 seconds as far as the Chinese players are concerned I think last quarter what we talked about was if the if the 59:44 59 minutes, 44 seconds industrial goods imports are opened we'll have to wait and watch and see what impact that can come. We haven't 59:52 59 minutes, 52 seconds seen any any direct impact yet but we do see in certain large projects wherein 59:59 59 minutes, 59 seconds one or two customers uh when they're executing large project they may prefer uh equipment out of uh China. I think we 1:00:07 1 hour, 7 seconds have seen that in past but that was almost in my memory 9 months to one year ago but it's not a kind of a very 1:00:15 1 hour, 15 seconds repetitive phenomena as yet in the marketplace. As far as the European competitors are concerned, I think most of the 1:00:23 1 hour, 23 seconds non-European competitors we have, they are already present in the market. But then of course you'll have relative as 1:00:30 1 hour, 30 seconds the market expands, you will also continue to see the expansion of uh the competitors. But you can see that we are a global company. We face all these 1:00:39 1 hour, 39 seconds competitors in different markets at and at the global or regional or the domestic level. We know uh how to how to 1:00:47 1 hour, 47 seconds kind of respond to such competitors and our focus to say number one or number 1:00:53 1 hour, 53 seconds two in the areas we operate uh stays for stays there and we continue to do what it is stay what it takes to manage the 1:01:02 1 hour, 1 minute, 2 seconds competitive intensity. Uh so I think going forward the I if the market landscape changes we continue to adapt 1:01:10 1 hour, 1 minute, 10 seconds accordingly but we haven't seen anything new uh other than the existing competitive intensity offered by the established players. 1:01:20 1 hour, 1 minute, 20 seconds Understood sir. Thank you so much and wish you all the best. Thank you. Thank you. Let's go to the next last word probably. 1:01:27 1 hour, 1 minute, 27 seconds Sure sir. Thank you ladies and gentlemen. This will be the last question for today which comes from the line of Parikhit Kpal from HTSC securities. Please go ahead. 1:01:37 1 hour, 1 minute, 37 seconds Hi sir, congratulations on a great quarter. So our first question is on the data center portfolio. So if you can help us understand versus the parent. So uh so what parent is servicing globally? 1:01:47 1 hour, 1 minute, 47 seconds So what percentage of that we'll be servicing from India and we also understand that parent has developed some very power efficient solutions like 1:01:55 1 hour, 1 minute, 55 seconds SSDs and solid state drives and transformers or is developing the solution. So when do we expect that kind of product to come into India because uh 1:02:03 1 hour, 2 minutes, 3 seconds when these hyperscalers come into India in a big way so it will mirror uh the global data center supply chain so which may benefit us. So just want to 1:02:10 1 hour, 2 minutes, 10 seconds understand that the contribution how much can it go uh from here on. 1:02:16 1 hour, 2 minutes, 16 seconds Uh thanks for this question. Uh you're right. Our global 1:02:26 1 hour, 2 minutes, 26 seconds I'm sorry to interrupt you, sir. Uh you're not audible right now. 1:02:37 1 hour, 2 minutes, 37 seconds We cannot hear you. All right. There was a bit of a break. 1:02:43 1 hour, 2 minutes, 43 seconds So yes, please continue. Our global global management has highlighted the 1:02:49 1 hour, 2 minutes, 49 seconds importance of data center for ABB given our strong footprint of electrification and you know data center is nothing but 1:02:58 1 hour, 2 minutes, 58 seconds computing power you require that's a core and then in order to support that computing power you need to have lot of 1:03:06 1 hour, 3 minutes, 6 seconds power infrastructure that supports that computing power. So we come into play on the supplying the power at the low voltage level and the medium voltage 1:03:15 1 hour, 3 minutes, 15 seconds level to the data centers and also the utilities which do the cooling of the data centers which consumes high 1:03:24 1 hour, 3 minutes, 24 seconds efficient motors as well as drives to support that part particular part of utility. So that's what our footprint is 1:03:31 1 hour, 3 minutes, 31 seconds and here hyperscalers especially they are experimenting a lot and researching a lot together with us in terms of how 1:03:39 1 hour, 3 minutes, 39 seconds to make sure not only create higher availability and reliability of the data centers as the size and that the 1:03:47 1 hour, 3 minutes, 47 seconds intensity of the power increases but also how that can be uh optimized. So within that optimum uh scenario lot of 1:03:56 1 hour, 3 minutes, 56 seconds new technologies are developed and being experimented and as far as India is concerned whenever any customer demands 1:04:04 1 hour, 4 minutes, 4 seconds as per their design criteria any of ABB technology is seamlessly available. It is not a question whether we have to get 1:04:12 1 hour, 4 minutes, 12 seconds that technology in India. It automatically and seamlessly flows to us. It basically depends upon how the demand is forming and what the customer 1:04:21 1 hour, 4 minutes, 21 seconds aspirations are in the during the design phase and we keep introducing those ideas to the domestic data center 1:04:28 1 hour, 4 minutes, 28 seconds players and some of them and most of them are listening to it very carefully and hopefully that should come part of their design criteria in future. 1:04:40 1 hour, 4 minutes, 40 seconds Sure. Thank you. Thank you. Thank you. 1:04:43 1 hour, 4 minutes, 43 seconds As that was the last Thank you sir. As that was the last question for today, I would now like to hand the conference over to Mr. TK Shrar for closing comments. Thank you and over to you sir. 1:04:55 1 hour, 4 minutes, 55 seconds Thank you Michelle for moderating the call and uh all the people on the call. 1:05:00 1 hour, 5 minutes Thank you very much for the interest which you have shown and always your support and clarifications help us uh go 1:05:06 1 hour, 5 minutes, 6 seconds a long way in uh um giving more data and more relevant data so that your decisions are better off. And thanks to 1:05:15 1 hour, 5 minutes, 15 seconds the management who was there part of this particular call and the preparations there too. Thank you very much. We meet again in the next quarterfall. 1:05:22 1 hour, 5 minutes, 22 seconds Thank you members of the management. On behalf of ABB India Limited, that concludes this conference. We thank you for joining us and you may now disconnect your lines. Thank you.