Atlanta Electricals Limited — Q3 FY26

Atlanta Electricals Ltd Q3 FY2025-26 Earnings Conference Call https://www.youtube.com/watch?v=FGAN8UjLJaQ Published: 3 months ago

0:01 1 second Ladies and gentlemen, good morning and welcome to the Atlanta Electricals Limited Q3 and 9 months FY26 earnings 0:09 9 seconds conference call. As a reminder, all participant lines will be in the listenon mode. There will be an opportunity for you to ask questions after the presentation concludes. 0:21 21 seconds Should you need assistance during this conference call, please signal an operator by pressing star then zero on your touchstone phone. 0:30 30 seconds Please note that this conference is being recorded. I now hand the conference over to Mr. 0:36 36 seconds Chetanya Satri from ad factors PR. Thank you and over to you sir. 0:42 42 seconds Thank you. Uh good morning everyone and thank you for joining us today to discuss the unodited financial performance for Q3 and 9 months FI26. I 0:50 50 seconds have with me Mr. Nil Kupashi Patel chairman and managing director Mr. 0:54 54 seconds Akshai Kumar Benal Mature Officer Mr. Anand Sharma, Chief Operating Officer and Mr. Mayel Suresh Baya, the chief financial officer. 1:05 1 minute, 5 seconds Before we proceed, I would like to bring to your attention that certain statements made during this discussion may constitute forward-looking statements. These statements are based 1:13 1 minute, 13 seconds on our current expectations, assumptions, and beliefs regarding future developments and are inherently subject to various risks, uncertainties, 1:21 1 minute, 21 seconds and factors beyond our control. Such forward-looking statements involve both known and unknown risks and we advise you to interpret them with caution. I 1:30 1 minute, 30 seconds will now hand over to Mr. Nir Patel for his opening remarks. Thank you and over to you sir. 1:36 1 minute, 36 seconds Thank you. Good morning everyone. A warm welcome to Atlanta Electrical's limited earnings conference call for the quarter 1:44 1 minute, 44 seconds and the 9 months end at 31st December 2025. 1:48 1 minute, 48 seconds Q3 FI26 marks the beginning of a new growth chapter for Atlanta Electricals. 1:53 1 minute, 53 seconds Over the past 18 months, we've invested heavily to expand our manufacturing capacity from approximately 16,000 MBA 2:01 2 minutes, 1 second to 63,000 MBA nearly a fourfold increase. This quarter we are seeing the investments translate into results. 80% 2:11 2 minutes, 11 seconds approximately 80% revenue growth a record EITA margins and alltime high order book. Let me take you through all the details. 2:23 2 minutes, 23 seconds We are a pure play transformer manufacturer with over three decades of operating history positioned in at the 2:31 2 minutes, 31 seconds intersection of India's energy transition and infrastructure modernization. We expand our capacity 2:39 2 minutes, 39 seconds We are now among the largest integrated power transformer producers in India with manufacturing capability spanning 2:46 2 minutes, 46 seconds from 33 KBclass power transformer 2 to 765 KVclass extra high voltage units. 2:53 2 minutes, 53 seconds What differentiates us from our execution track record over 4,700 transformers totaling more than 1 lakh 3:01 3 minutes, 1 second 7,000 NVA supplied across 19 states and three union territories in India. Our customer base of 251 clients includes uh 3:10 3 minutes, 10 seconds customers like Jetco, Adani, Green Energy, Tata Power and other leading utilities. With our growing presence in the higher voltage segment, we have 3:19 3 minutes, 19 seconds significantly expanded our addressable market into space characterized by high entry barriers and better margin profiles. 3:28 3 minutes, 28 seconds This position becomes even more relevant when you look at the industry tailwinds that are playing out. 3:35 3 minutes, 35 seconds Uh the transformer industry in India is at is at an infliction point. 3:41 3 minutes, 41 seconds Estructural forces are driving the unprecedented demand. First the transmission infrastructure is emerging 3:47 3 minutes, 47 seconds as critical bottleneck. India's power demand rebound sharply in December with 7% year-on-year growth. But the grid is 3:56 3 minutes, 56 seconds struggling to keep up pace. Solar curtailment reached 12% October 25 and 4:03 4 minutes, 3 seconds nearly 40 gawatt of renewable PPAs face delays due to great integration constraints. Government's response INR 4:13 4 minutes, 13 seconds 9.6 trillion is planned. Transmission capacity KPIX through 2032 directly benefits transformer manufacturers. 4:23 4 minutes, 23 seconds Second, the energy mix is shifting towards higher voltage requirements. A renewable capacity scales and the 4:30 4 minutes, 30 seconds transmission distance increases. Demand is moving towards 400 KV and 765 KV class transformers. This segment is 4:38 4 minutes, 38 seconds characterized by high entry barriers, longer customer qualification cycles and structurally better margins exactly 4:47 4 minutes, 47 seconds where Atlanta is positioned itself currently. 4:51 4 minutes, 51 seconds Three, third, new demand segments are emerging. Data centers, green hydrogen, EV charging, battery storage systems as 5:00 5 minutes an infrastructure are creating incremental demand for power transformers. These are high growth segments that will sustain demand beyond the current transmission buildup cycle. 5:12 5 minutes, 12 seconds On the recent news potential easing of restrictions of Chinese biders in the government 5:19 5 minutes, 19 seconds contracts, we are aware of the development and monitoring them very closely. However, structural rel uh 5:26 5 minutes, 26 seconds realities remain unchanged. Any participant must manufacture in India and the approval qualification process 5:33 5 minutes, 33 seconds of the power sector tender takes 12 to 18 months. The local content requirement continue to apply. one currently only 5:42 5 minutes, 42 seconds one Chinese manufacturer operates in India and their capacity is fully committed for next 18 to 20 months. At 5:50 5 minutes, 50 seconds Atlanta Electricals our competitive strength lies in three decades of trans customer relationship providing execution track record and expand 5:58 5 minutes, 58 seconds manufacturing footprint. We remain focused on what we control uh what what we can control capacity utilization 6:07 6 minutes, 7 seconds quality and customer service against the favorable backdrop. Let me now take you through our financial performance for the quarter. 6:16 6 minutes, 16 seconds Q3 FI26 consolidated results stood at INR 472 crores up 80% yearon-year from 6:24 6 minutes, 24 seconds INR 263 crores in Q3 FI25 and up 49% sequentially from INR 317 Kores in Q2 6:33 6 minutes, 33 seconds FI26 this is a strong growth driven by contribution of our new growth facility and continued high utilization at our 6:41 6 minutes, 41 seconds legacy plants IITA stood at 91 crores up 120% yearonear from INR 42 crores. Iita 6:52 6 minutes, 52 seconds margins expanded to 19.4% from 15.8% a 350 basis points improvement. This 7:00 7 minutes margin expansion reflects operating leverage from higher volumes, economies of scale, favorable product mix and 7:07 7 minutes, 7 seconds improved product uh procurement efficiency in key input materials 7:13 7 minutes, 13 seconds that stood at INR 43 crores up 95% yearonear from INR22 crores 7:21 7 minutes, 21 seconds 9 month consol FI26 consolidated revenue stood at 114 crores up 33% % yearonear 7:31 7 minutes, 31 seconds from 833 crores reflecting progressive capacity ramp up through the year. ITA 7:38 7 minutes, 38 seconds stood at INR 195 crores up 56% yearonear with margin expansions of 270 basis points to 17.7%. 7:49 7 minutes, 49 seconds PAT stood at nearly 100 crores with a margin of 9%. The strong per financial 7:56 7 minutes, 56 seconds performance is underpinned by robust order inflows. Let me share details of our order book. Our order book stands at 8:03 8 minutes, 3 seconds all-time high of 2451 crores which as on 31st December 2025. 8:10 8 minutes, 10 seconds Order intake due during Q3 FI26 was INR 796 crores providing strong 8:18 8 minutes, 18 seconds execution visibility over the next quarter. We secured INR 298 crores uh 8:26 8 minutes, 26 seconds order from JCO for 25 high capacity transfer manufacturing including 21 units of 220 KV 160 MB. Three units of 8:36 8 minutes, 36 seconds 66 KV uh 20 MB and one unit of 220 KV 150 MB auto transformer. 8:44 8 minutes, 44 seconds These orders reflect deep trust built over three decades of partnership with Gujarat's premier state transmission utility. We also received orders from 8:52 8 minutes, 52 seconds Adani green energy for supply of inverted duty transformers totaling to INR1 134 kos further strengthening our presence in the renewable energy 9:01 9 minutes, 1 second segment. We have secured marquee orders of EHV marquee EHV orders of INR 184 9:09 9 minutes, 9 seconds crores from BNP power projects. Bogal BNT power projects for the Bongal project comprising 315 MVA 400 KBclass 9:18 9 minutes, 18 seconds transformer 100 MVA 132 KBL class transformer and 400 KV bus reactor. This order strengthens our reference in the 9:26 9 minutes, 26 seconds extra high voltage segment. In solar segment, we secured orders of 116 crores for solar pooling substations across 9:35 9 minutes, 35 seconds Bikan, Bijapur and Bongal projects. We have also secured our first significant export order of 20 crores marking an 9:43 9 minutes, 43 seconds important milestone in the export journey. Now let me update you on the operational process. 9:50 9 minutes, 50 seconds Team 3 FI26 is the first full quarter where our expanded capacity has contributed meaningfully to our revenues. Vad facility commenced 9:59 9 minutes, 59 seconds production in July contributes approximately onethird of quarterly revenue 10:05 10 minutes, 5 seconds designed for transformers up to 500 NBA 400 KB class. This plant enables us to address higher ticket size ticket 10:13 10 minutes, 13 seconds orders. Atlanta trfo has commenced quart operations this quarter. The facility 10:20 10 minutes, 20 seconds provides manufacturing capability of 400 KV and 765 KB class transformers positioning us for a higher value EHP 10:29 10 minutes, 29 seconds segment testing infrastructure. We have added three NAPL accredited testing laboratories during the quarter taking 10:37 10 minutes, 37 seconds our total tally to seven. This capacity is critical for in-house high voltage testing and strengthening our position for large utility tenders. 10:49 10 minutes, 49 seconds In industry outlook over over investment phase is largely complete. The focus now is on driving capacity utilization 10:58 10 minutes, 58 seconds across our expanded manufacturing footprint. As utilization scales, we expect operating leverage benefits to 11:06 11 minutes, 6 seconds continue flowing through into our margins. The demand environment remains supportive with INR's 9.6 trillion of 11:14 11 minutes, 14 seconds transmission investment planned over next seven years. With our record order book providing strong visibility, we are 11:22 11 minutes, 22 seconds confident of delivering sustained growth. To summarize, the results of this quarter validate our investment 11:29 11 minutes, 29 seconds thesis. We have delivered 80% revenue growth, 120% AITA growth, and 350 basis points of our margin expansion. This 11:38 11 minutes, 38 seconds reflects our structural operating leverage in our expanded capacity. 11:43 11 minutes, 43 seconds Atlanta Electricals today has a strong foundation than before. Expanded capacity across five facilities, growing 11:51 11 minutes, 51 seconds presence in higher voltage segments, enhanced infrastructure, strengthened balance sheet and record book of 2,451 12:01 12 minutes, 1 second crores. The industry is at the structural inflection point and we are well equipped to capture this multi-year 12:09 12 minutes, 9 seconds opportunity. Thank you for continued support and confidence in Atlanta Electricals. We now open the floor for questions. Thank you. 12:19 12 minutes, 19 seconds Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press 12:27 12 minutes, 27 seconds star and one on the touchstone telephone. 12:30 12 minutes, 30 seconds If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use 12:37 12 minutes, 37 seconds handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question symbols. 12:50 12 minutes, 50 seconds The first question is from the line of Kunal Shade from BNK 361. Please go ahead. 12:57 12 minutes, 57 seconds Yeah. Hi, good morning sir. Thank you for the opportunity. Uh just quickly sir wanted to get your views on this whole 13:05 13 minutes, 5 seconds Chinese thing which you obviously clarified in your opening remarks but just wanted to get your sense on so what is the background of where this 13:13 13 minutes, 13 seconds discussion started and like you mentioned you know if you can reiterate what their intent is. 13:21 13 minutes, 21 seconds Morning sir Shamadish. 13:23 13 minutes, 23 seconds uh I am sure this question is uh let's say is on top of the mind for uh the entire nation or the transmission sector 13:31 13 minutes, 31 seconds of India actually which has been expanding um in in tune to match the requirements given by uh the government 13:40 13 minutes, 40 seconds of India to generate 500 gaw of energy through renewables by 2030. 13:46 13 minutes, 46 seconds uh this whole thing possibly is to bridge uh the supply chain gap more so in the BTG uh sector or the boiler 13:54 13 minutes, 54 seconds turbine generator segment. But I am sure this transmission equipment uh segment also will not be untouched by this 14:03 14 minutes, 3 seconds particular uh thing. This is what we get to hear from the different sources sitting in the government. What we have been able to gather uh from the sources 14:12 14 minutes, 12 seconds is that uh that while participation from the overseas uh uh parties shall be allowed in uh the 14:21 14 minutes, 21 seconds tenders or government tenders. Uh the worry part possibly is coming from the Chinese participation because for other countries it was always open. 14:32 14 minutes, 32 seconds As far as uh Chinese participation is concerned, we also are told that fully finished transformers possibly would not 14:39 14 minutes, 39 seconds be allowed to be imported. So which again uh zeros us down uh to the supply of transformer from a manufacturer who 14:48 14 minutes, 48 seconds is sitting in India which is one manufacturer only. Given the nature of uh the their plant and the kind of 14:56 14 minutes, 56 seconds voltage capacity manufacturer uh they are doing we believe that their order book also is quite healthy because it's 15:05 15 minutes, 5 seconds not about the India growth story the same growth story is getting repeated in the Middle East also is there in US also 15:12 15 minutes, 12 seconds and Europe also and they have been catering to different kind of export orders since uh this uh restriction came 15:20 15 minutes, 20 seconds in place. So this is what we know uh as of now and uh further whatever time NITI 15:28 15 minutes, 28 seconds Aayog or government will roll out some specific specific inputs we shall certainly be able to take a note of it and move accordingly. 15:37 15 minutes, 37 seconds Just to add to what Anand just mentioned this is Neil Patel again. uh the initial uh India in in the Indian power growth 15:46 15 minutes, 46 seconds story India was completely focusing on renewable and recent developments India has started to move also towards government which has created a surge in 15:54 15 minutes, 54 seconds demand for boiler turbines and that's the reason uh this development has taken place it's more of a global uh economic 16:01 16 minutes, 1 second scenario rather than you know focusing on one product uh and it's a myth that uh Chinese transformers would be cheaper 16:10 16 minutes, 10 seconds uh we are in Indian transformer manufacturers and Indian transformer rates are fairly competitive to Chinese 16:20 16 minutes, 20 seconds right appreciate it sir. Uh sir but any clue on when they say you know this was done to ease the supply chain issue what 16:29 16 minutes, 29 seconds exactly are they referring to because as you clearly mentioned that they are not going to allow fully built transformers or for that matter fully built boilers or any equipment which are fully built. 16:40 16 minutes, 40 seconds So what exactly which part of the supply chain are they referring to? 16:44 16 minutes, 44 seconds Sir again uh people I I would like to repeat uh my earlier statement that this is primarily 16:52 16 minutes, 52 seconds to bridge the gap uh between supply and demand of boiler turbine and generator. 16:58 16 minutes, 58 seconds As Nidel just now mentioned that like we uh saw the announcements of renewable energy generation about two to three 17:07 17 minutes, 7 seconds years back. Uh government of India or the ministry of power has also felt the need of uh bringing in more thermal and 17:16 17 minutes, 16 seconds hydro power generation to stabilize the grid. And this uh whole development uh I guess the existing 17:25 17 minutes, 25 seconds players possibly were not prepared and hence this move is allowed to bridge the gap uh between the supply and demand of 17:34 17 minutes, 34 seconds boiler, turbine and generator. So this is primary for BTG but other transmission equipments also uh we will 17:42 17 minutes, 42 seconds see uh the impact coming in. What what exactly would be the impact is something which we would get to know as we get more clearly from the government opinion. 17:52 17 minutes, 52 seconds Sir, thank you so much for the answer and best of luck for the future quarters. Thank you. 18:00 18 minutes Thank you ladies and gentlemen. In order to ensure that the management will be able to address all the questions from 18:07 18 minutes, 7 seconds the participants in the conference call, we request you to kindly limit your questions to per participant. If you have a follow-up question, please rejoin the queue again. 18:20 18 minutes, 20 seconds The next question it's from the line of Nikil Abhankar from UTI Asset Management Company. Please go ahead. 18:28 18 minutes, 28 seconds Yeah. Uh thank you sir and congrats on a good set of numbers. So uh if I see your margins quarterly uh I mean bulk of the 18:36 18 minutes, 36 seconds EITA growth is coming from uh gross margin expansion. So uh do you think this is sustainable sustainable given 18:43 18 minutes, 43 seconds the commodity price hikes that we are seeing cross going ahead? 18:51 18 minutes, 51 seconds So this is Neil Patel uh uh commodity prices uh for transformer manufacturing when we talking about 19:00 19 minutes large transformers predominantly transformers beyond the 66 uh 220 KV class and 400 majority of them are 19:08 19 minutes, 8 seconds driven through price variation class and there's a price pass through mechanism and hence uh the commodity prices do not 19:15 19 minutes, 15 seconds end up squeezing the gross margins. Uh with that said, smaller transformers uh which are one of requirements from the 19:23 19 minutes, 23 seconds private sector do come with firm pricing and we do book our uh material rates when and when the order comes. Uh so 19:31 19 minutes, 31 seconds commodity price uh inflation we don't see a gross margin reduction on on that front. 19:39 19 minutes, 39 seconds Okay. And so uh for the 9 months uh your sales volume would be somewhere around 13,000 uh MBA. 19:50 19 minutes, 50 seconds Yes, it is 13,500 only and for the full year what would be the guidance? 19:59 19 minutes, 59 seconds Uh so it'll be difficult to give you exact guidance on the MBA front but the exact terms that we've been maintaining 20:06 20 minutes, 6 seconds that we've been continuing with uh a growth rate of 40% yearon-year basis and we expect nothing less this year on revenue front. 20:15 20 minutes, 15 seconds Understood. And just a clarity on this uh China thing again. So uh uh as you mentioned in the earlier answer. So is 20:24 20 minutes, 24 seconds the is the government thinking of not allowing direct imports only from China but might look to import from other countries directly? 20:34 20 minutes, 34 seconds Nickel by Anes Sharma see imports from other countries was always allowed actually but uh there is there are few 20:44 20 minutes, 44 seconds let's say reasons because of which nobody possibly other than the incumbent players who have been there in the Indian territory and operating for 20:52 20 minutes, 52 seconds decades together like so Vitachi and G nobody actually has put up any plant in last so many years when the requirement 21:00 21 minutes was good or bad actually so there are a reason because the market 21:06 21 minutes, 6 seconds beyond India is more profitable for them and anybody and everybody including the Chinese according to us would like to 21:14 21 minutes, 14 seconds invest their energies and their uh efficiencies and their investments uh for the supply of equipment to the other 21:23 21 minutes, 23 seconds markets. So India has not been a lucrative market for all any of these players. 21:30 21 minutes, 30 seconds Okay sir, understood. Thank you and all the best. Thank you sir. A reminder to all the participants. 21:38 21 minutes, 38 seconds Please submit your questions to all participant. If you have a follow-up question, please rejoin the queue again. 21:46 21 minutes, 46 seconds The next question is from the line of Arafat from Anderson Nepon live. Please go ahead. Hi sir, I'm audible. 21:55 21 minutes, 55 seconds Yes, you are. Good morning. Yes sir. Yes sir. Good morning sir. 21:58 21 minutes, 58 seconds Thanks for uh uh taking a question and congrats on great SE numbers. Now first question is on uh again uh firstly 22:06 22 minutes, 6 seconds starting with the revenue growth. So you a very strong print with the 80% revenue growth. So is it possible to quantify let's say how much come from the volume 22:14 22 minutes, 14 seconds and also let's say product mix or let's say pricing uh improvement or uh and also comment on growth visibility for FA 27. 22:28 22 minutes, 28 seconds Good morning sir. May decide. So uh sir as I told you the revenue growth is the 22:34 22 minutes, 34 seconds volume is 13,500 MBA for 9 months and 22:41 22 minutes, 41 seconds we go 132 KV segment contributes 19% and 66 KV contributes 32%. 22:58 22 minutes, 58 seconds Okay. And sir, I just want to compile let's say we will take it from the let's say you know post phone call and uh secondly sir uh if you look at the 23:05 23 minutes, 5 seconds margin expanded significantly during this process again led by the gross margin. We just want to understand what is the sustainable aid margin we should 23:13 23 minutes, 13 seconds factor in for let's say next couple of years let's say for 20 and 28 23:20 23 minutes, 20 seconds uh the margin the have come out from the results uh they are they are more or less uh fair 23:29 23 minutes, 29 seconds and uh sustainable the reason being uh as we have maintained uh lower the KB class more competitive higher the KB 23:37 23 minutes, 37 seconds class it is uh less competitive uh and the expansion in our growth has come predominantly from 220 KV class. Hence 23:46 23 minutes, 46 seconds higher KV class is contributing better margins. Uh got it sir. Thanks. That is Thomas. 23:54 23 minutes, 54 seconds Thank you. 23:57 23 minutes, 57 seconds Thank you. The next question is from the line of Ana from Philip Capital. Please go ahead. 24:06 24 minutes, 6 seconds Uh congratulations to the entire team of Atlanta Electricals for delivering an exceptional performance. Uh and thank you for taking my question. Uh just a 24:15 24 minutes, 15 seconds quick question sir. Uh just wanted to understand that uh if you can share an update on the approval status from power 24:21 24 minutes, 21 seconds grid for the Atlanta plant and if uh the expected timeline for receiving the clearance. 24:32 24 minutes, 32 seconds Good morning sir. 24:34 24 minutes, 34 seconds uh we have got uh the assessment uh dates from the power grid for our Gador facility which is unit 4. So we are 24:42 24 minutes, 42 seconds expecting to finish that assessment audit within this particular month only. 24:47 24 minutes, 47 seconds Uh so this shall be a fresh assessment and a fresh approval when it comes to Atlanta which is BTW Atlanta that plant 24:56 24 minutes, 56 seconds was approved by power grid uh till the time it was in operation. So once we are done with the approval process of BDO 25:05 25 minutes, 5 seconds facility we shall initiate a dialogue with power grid for the reapproval of the Atlanta traffic facility. So that we 25:14 25 minutes, 14 seconds expect that in next couple of months time it should also happen. 25:20 25 minutes, 20 seconds Okay sir. Thank you. Uh and what what is the kind of order book that you are targeting by the by FI26 and sir? 25:29 25 minutes, 29 seconds Approximately 700 cr is our quarterly intake. We 25:38 25 minutes, 38 seconds expect that to be about 600 crores uh quarterly intake this year. This quarter also 25:47 25 minutes, 47 seconds okay sir. Okay sir that's it from my side. Thank you so much. 25:54 25 minutes, 54 seconds Thank you. A reminder to all to limit your questions to two per participant. 26:00 26 minutes The next question is from the line of Pravin Motwani from Bank of India Mutual Fund. Please go ahead. 26:07 26 minutes, 7 seconds Yeah. Hi. Hi team. Uh thanks for this opportunity. Uh sir, I have a one quick question on the order intake of 796 26:16 26 minutes, 16 seconds kores. So just wanted to understand are these orders carrying a better margins uh for you? 26:27 26 minutes, 27 seconds Sir the order intake is coming gradually and uh it the all orders are having reasonable amount of margins. Uh 26:37 26 minutes, 37 seconds these are predominantly coming from our existing customers which we would like to continue in RP for a long term. Hence 26:44 26 minutes, 44 seconds uh the margins are kept pretty reasonable only. Uh I would not say better or not good. um 26:52 26 minutes, 52 seconds the the margins are as as equal as the current quart last quarter order intake. 26:58 26 minutes, 58 seconds So you are saying margins in these orders are equal to what you reported margins in the last quarter correct? Yes. Yes. 27:07 27 minutes, 7 seconds Got it. Uh so sir just wanted to understand is there any pricing pressure or the margin pressure in the industry because lot of capacity additions are 27:15 27 minutes, 15 seconds taking place right uh across the uh transformer manufacturers. So are you 27:22 27 minutes, 22 seconds seeing any sort of pressure in terms of you know you getting the order from? 27:29 27 minutes, 29 seconds Good morning sir Shama this side. Uh this is uh certainly a very very hot topic and being discussed in on every 27:37 27 minutes, 37 seconds earnings call and we get to uh hear this concern from our investors also. Yeah. 27:43 27 minutes, 43 seconds Uh we have been explaining and this is our firm belief that the kind of requirement which is there on the plate 27:50 27 minutes, 50 seconds against which we if we let's say try to match up the supply side even after expanding uh let's say all all the 27:58 27 minutes, 58 seconds players expanding there would still be some amount of vacuum in the supply side and hence we do not feel that there 28:07 28 minutes, 7 seconds shall be any pressure on the pricing in a time to come also. It's not there at the moment but uh we do not expect that 28:14 28 minutes, 14 seconds to come in a time uh of next 3 to four years at least. 28:22 28 minutes, 22 seconds Okay, got it. Got it. Thank you. Uh those were the questions from my Thank you sir. Thank you sir. 28:31 28 minutes, 31 seconds Thank you. The next question is from the line of Seb shab from ICC Predential Asset Management Company. Please go ahead. 28:40 28 minutes, 40 seconds Yeah, thanks for the opportunity. So, first question on the order book uh which is around 2400 crores. What's the average execution period now for these? 28:52 28 minutes, 52 seconds Sorry sir, we didn't get your question. 28:53 28 minutes, 53 seconds If you can repeat once again on the order book part uh which is roughly around 2400 uh 2450 crores what is the average execution period now? So 29:02 29 minutes, 2 seconds this is still one year but now it is much longer. 29:07 29 minutes, 7 seconds Uh sir we possibly have not calculated the blended average of the order book but uh typically it will vary for the 29:15 29 minutes, 15 seconds voltage class to voltage class. Uh for 220 KV class the minimum commencement period uh as of date also stands at 9 29:24 29 minutes, 24 seconds months to 10 months. For 66 KV class it is close to 4 months and for 132 KB class it would be somewhere around 6 29:31 29 minutes, 31 seconds months or so. So we we certainly can calculate a blended average of uh the order book we have but as of now 29:38 29 minutes, 38 seconds possibly we do not have or we have figured. So sir uh say sir may decide uh so current order book which is 29:47 29 minutes, 47 seconds unexecuted uh amounting to 2 4 51 CR. We uh anticipate this to be uh executed 29:54 29 minutes, 54 seconds within next uh 1 and a half year. It will be blended. Few orders will be completed this year itself and few will be spelled over to next. 30:04 30 minutes, 4 seconds Sure. Okay. Just second on the jet order uh that 298 crores which we have received for 25 capacity transformers. I 30:12 30 minutes, 12 seconds think I missed on the opening much but what are the say delivery timelines on these and what KVclass transformers these are? 30:20 30 minutes, 20 seconds These are 220 KD class power transformers and auto transformers uh with a lead time of 9 months and then 30:26 30 minutes, 26 seconds supplies of equal supplies of uh transformers on quarterly basis. So it'll last for around 3/4 post 9 months. 30:36 30 minutes, 36 seconds Uh there's a condition in UDP tenders wherein if you're able to manufacture faster, they're okay to take delivery 30:43 30 minutes, 43 seconds early. Uh when we say quarterly, they will come out to be about five or six numbers per quarter. So that's how the deadlines are given in the contracts. 30:58 30 minutes, 58 seconds I hope I answered your question sir. Yeah, thanks and all the best. Thank you sir. 31:06 31 minutes, 6 seconds Thank you. A reminder to all to limit their questions to two per participant. 31:12 31 minutes, 12 seconds The next question is from the line of Vela from Ambit Capital. Please go ahead. 31:19 31 minutes, 19 seconds Hello. Yeah, good morning sir. 31:22 31 minutes, 22 seconds Congratulations on a great set of numbers. So I just wanted to understand uh when you looked at the new facility 31:30 31 minutes, 30 seconds right the so had started to contribute right yes for the quarter yeah and the 31:37 31 minutes, 37 seconds depreciation effect which we are seeing for the quarter for the W plant it is completely set in right right 31:45 31 minutes, 45 seconds and lastly the new new plant when do we expect the contribution from the last facility which has come in 15,000 MB 31:54 31 minutes, 54 seconds the Ross the December quarter accounted for 32:00 32 minutes one transformer from the fifth facility the ERA facility please understand when 32:07 32 minutes, 7 seconds the facilities do start there are hiccups and those hiccups are really supposed to be taken care of which we took care of in now we're taking care of 32:16 32 minutes, 16 seconds in uh uh N unit the unit five and it'll start contributing in this quarter 32:24 32 minutes, 24 seconds in product. So basically and in terms of run rate of order inflow per se uh given 32:32 32 minutes, 32 seconds that all the five units should be operational uh what kind of run rate in terms of order inflow because can we take as a unit? 32:43 32 minutes, 43 seconds This is a business strategic decision. 32:45 32 minutes, 45 seconds We have taken a very bold move of not to take further 400 KVclass orders till we execute our first order. uh we don't 32:54 32 minutes, 54 seconds want to expose ourselves to the markets without uh a proven uh product prototype first. Uh as soon as we open up and we 33:01 33 minutes, 1 second develop the first 400 KV class transformer the order intake will substantially improve because 400 KV class orders do last for about two 33:10 33 minutes, 10 seconds years. The lead time are months to 18 months not even 12 months. So they last for more than about two years and hence 33:18 33 minutes, 18 seconds the order book pylon will substantially go up uh once we once we open the floodgates for 400 K. Current 400 KB 33:28 33 minutes, 28 seconds class waters are actually very very uh minute orders that we have taken just to prove our prototypes and these are those 33:35 33 minutes, 35 seconds prototypes which are generally taken by the Indian trans sector. Got it. 33:43 33 minutes, 43 seconds Got it. Thank you. Thank you Nai and all the rest of you. Thank you so much. Thank you. 33:50 33 minutes, 50 seconds Thank you. The next question is from the line of Ishwar R from I thought PMS. Please go ahead. 33:58 33 minutes, 58 seconds Hi sir, thank you for taking my call. Uh so my questions is uh about the broader industry context. Uh as for the our 34:07 34 minutes, 7 seconds national electricity plan uh laid out by the government uh for the period between FI22 and 27 we had a plan a lot of 34:16 34 minutes, 16 seconds planned addition uh the 400 and 765 KV class about 3.5 lakh MBA and 2.5 2.8 34:23 34 minutes, 23 seconds lakh MBA approximately and uh in between 27 to 32 34:30 34 minutes, 30 seconds we have about 3.2 22 and 1.35 lakh capacity in the 6765 and 400 KV class uh 34:36 34 minutes, 36 seconds almost. So how much of the 22 to 27 plan is still to be executed uh in the 34:44 34 minutes, 44 seconds transformation capacity and how much can be expected to spill over to the next uh uh period because uh what we've been 34:51 34 minutes, 51 seconds hearing in we've been hearing from the ground is that there has been a lot of uh execution delays and right away issues. So how much do you expect to spill over to the next uh period sir? 35:04 35 minutes, 4 seconds That's my first question. 35:08 35 minutes, 8 seconds So this is uh a national level issue that you are referring to and unfortunately we would not have those uh numbers readily available. We can 35:17 35 minutes, 17 seconds certainly work and uh provide you these numbers. Uh yes there have been certain issues on uh right off way on uh uh 35:27 35 minutes, 27 seconds execution delays but please understand the pace at which India is moving it is a considerably high pace that the 35:35 35 minutes, 35 seconds country is moving towards and in this pace uh certain delays are bound to happen in terms of uh uh execution in 35:43 35 minutes, 43 seconds terms of taking our weather into consideration in terms of right off however people once invested would have 35:50 35 minutes, 50 seconds would be certainly motivated to capitalize the investment by charging the solar power generating site or 35:57 35 minutes, 57 seconds substation. So the efforts are there in all direction. 36:02 36 minutes, 2 seconds Um u whatever this is translating into on our front we don't see any product 36:10 36 minutes, 10 seconds movement delays as in a manufactured product usually is sent and we don't see any delays on that front. 36:19 36 minutes, 19 seconds Right. understood and uh I wanted to understand uh how much is our manufacturing capacity for the 765 36:27 36 minutes, 27 seconds KV class uh transformers and uh since a lot of domestic players are also putting up capacity uh how do you expect the 36:37 36 minutes, 37 seconds supply and demand dynamics to look in this particular class from let's say in the coming 3 to 4 year period 36:45 36 minutes, 45 seconds our unit five sir is 755 KBK capable It is currently situated at 15,000 MBA 36:53 36 minutes, 53 seconds capacity with provisions of three-fold expansions to taking it to 45,000 which we have not started yet. Uh again with 37:01 37 minutes, 1 second 15,000 MBA uh manufacturing capacity on annual basis it's a fairly low quantum against the demand that is there in the industry right now. 37:13 37 minutes, 13 seconds Correct sir. Okay. And how do you see the domestic market evolving as almost all of the players are putting up capacities and the capacity is almost 37:21 37 minutes, 21 seconds set to double uh in the medium term the two to three year uh time frame. 37:27 37 minutes, 27 seconds So this is the need of the hour actually. If uh people will not expand today when will they do it actually? So 37:34 37 minutes, 34 seconds this is the national need and uh everybody uh is has announced the expansion plans. We were a little ahead 37:43 37 minutes, 43 seconds in our uh planning and execution of putting up additional facility. So this is in line with the requirement of the nation actually. 37:52 37 minutes, 52 seconds Right. Right. Okay. That's all the questions I have. So thank you for Thank you. 38:00 38 minutes Thank you. A reminder to all to limit their questions to two per participant. 38:06 38 minutes, 6 seconds If you have a follow-up question, please rejoin the queue again. 38:10 38 minutes, 10 seconds The next question is from the line of Pesh Ayur from Sequent Investments. Please go ahead. 38:17 38 minutes, 17 seconds Uh thank you sir for the opportunity. So my first question uh is regarding uh uh the 38:23 38 minutes, 23 seconds PGCIL audit uh that that was expected to uh happen in November. Uh could you give any update uh regarding the same? 38:34 38 minutes, 34 seconds Yes. uh as uh uh we talked uh in in our last earnings call also that was expected to be done in the month of 38:43 38 minutes, 43 seconds November but because of some let's say issues at the power grid uh side only this particular thing has been delayed 38:52 38 minutes, 52 seconds and now we have got a firm date uh and this particular audit of unit 4 which is VO facility should finish in this 39:01 39 minutes, 1 second particular month Uh okay. uh and sir um uh I read it uh 39:10 39 minutes, 10 seconds in your presentation about uh you know good amount of revenue around one third of the quarterly revenue coming from bad 39:19 39 minutes, 19 seconds uh can you facilities so can you give me the uh utilization capacity utiliz unit 39:26 39 minutes, 26 seconds for the quarter three s unit uh B unit has contributed around 39:36 39 minutes, 36 seconds 160 K of uh revenue in Q3. 39:41 39 minutes, 41 seconds Yes. Uh that I Yeah, I got it. But uh because that is in rupee, I just wanted to understand what would have been the utilization 39:49 39 minutes, 49 seconds uh of uh the unit for the quarter s in the volume it's close to 30%. 40:01 40 minutes, 1 second It's close to uh okay sir. So yeah that's all from my sector then thank you sir. 40:11 40 minutes, 11 seconds Thank you. The next question is from the line of naman panbar from datasia investments. Please go ahead. 40:19 40 minutes, 19 seconds Yeah good morning sir. Thank you so much for the opportunity. So on the industry perspective I just wanted to understand on the best side you have any provided 40:28 40 minutes, 28 seconds any transformer on that particular project and which type of transform mostly used to go in that particular projects? 40:37 40 minutes, 37 seconds The best is picking up pace and picking up pace very well and we expect requirements uh coming from the best projects in a time to come very heavily. 40:49 40 minutes, 49 seconds We recently have got one order for one of the best projects while there are many inquiries which is which are in the 40:57 40 minutes, 57 seconds pipeline and which are under active consideration and discussion. So we expect let's say some inquiries uh to be 41:05 41 minutes, 5 seconds for getting converted fruitfully in our favor in a time to come in this particular quarter 41:12 41 minutes, 12 seconds and this type uh the the transformer that are you got to order for the best is what type basically it's a IDT or 41:20 41 minutes, 20 seconds instrument or this is power power transformer only which is uh in terms of the renewable 41:27 41 minutes, 27 seconds energy side is uh counted as a pooling transformer. 41:32 41 minutes, 32 seconds Okay. The pooling transfer understood. And secondly on the export side, so as of now we don't have a much 41:41 41 minutes, 41 seconds contribution on the global or export side. So as we see any big opportunity to tap to the global market also or we 41:48 41 minutes, 48 seconds will be strict towards the domestic only. 41:52 41 minutes, 52 seconds Sir, our majority focus is going to be on the domestic market only because uh that's where we are situated and we 41:59 41 minutes, 59 seconds certainly have obligation and our duty to fulfill a national requirement and but alongside that we uh certainly 42:08 42 minutes, 8 seconds have our export specific team working in getting our footprint expanded into the different territories or the geographies 42:18 42 minutes, 18 seconds across the globe. We received our first sizable order for the export in uh the last quarter and there are many 42:26 42 minutes, 26 seconds inquiries which are under active discussions in this particular quarter also and we are sure that we shall be 42:34 42 minutes, 34 seconds adding to the tally of the export order book in this particular quarter and that will continue in in a time to come for sure. 42:43 42 minutes, 43 seconds Okay, understood. And lastly on the bath only. So how much big the beat pipeline would be for the batch related projects. 42:54 42 minutes, 54 seconds Come again sir did not get your question. 42:56 42 minutes, 56 seconds Uh so yeah so for the beat pipeline for the bass related projects. So transform the bass only majorly how much would be that? 43:05 43 minutes, 5 seconds Uh we shall have to check a specific figure and get back to you sir. Okay then. Yeah. 43:12 43 minutes, 12 seconds Okay. Thank you so much for answering. Thank you sir. 43:18 43 minutes, 18 seconds Thank you. A reminder to all the participants to limit their questions to two per participant. If you have a follow-up question, please rejoin the queue again. 43:28 43 minutes, 28 seconds The next question is from the line of Nishita from Sapphire Capital. Please go ahead. Um yes. Hello. 43:37 43 minutes, 37 seconds Hello. Yeah. Hi. 43:38 43 minutes, 38 seconds Yeah. Yeah. Congratulations on a very good set of numbers. So uh I'm looking at this company for the first time. So I apologize ply if the questions are 43:47 43 minutes, 47 seconds repetitive. So I just wanted to ask you mentioned that uh we get and we enjoy better margin than the industry because 43:55 43 minutes, 55 seconds we focus more on the higher KV class uh transformers. So is that going to be our strategy going forward? Like you 44:03 44 minutes, 3 seconds mentioned that our expansion growth and expansion comes from 220 KV class. So are we going to focus on higher KV class 44:11 44 minutes, 11 seconds going forward also and are the margins going to be sustainable at 19% or are there any chance to improve these margins as well? 44:21 44 minutes, 21 seconds So uh it's it's uh I'm sorry if we miscommunicated. It's not that we have better margins uh than the industry. It 44:29 44 minutes, 29 seconds is the industry standard wherein the lower KV class is fairly competitive. 44:34 44 minutes, 34 seconds the higher KB class the higher we go on the KVclass front the margins continue to be getting better and better. uh 44:43 44 minutes, 43 seconds Atlanta electricals historically has been operating under 220 KV so 220 KV and below right till 33 KV and very 44:51 44 minutes, 51 seconds recent times uh we have expanded our facility to 400 KV and 765 KB class orders as a part of starting we've 44:59 44 minutes, 59 seconds received our first 400 KB class order and certainly the margins in 400 KB class are better than the 220 KB class 45:06 45 minutes, 6 seconds segment the margin improvement that we see in this particular quarter is because of the output that is coming from the Bod facility and the Bod 45:15 45 minutes, 15 seconds facility mainly contributes an addition of execution of 220 KB glass transformers which is showing a 45:22 45 minutes, 22 seconds substantial improve on our gross margins. So it is not that we enjoy better margins the whole entire industry 45:29 45 minutes, 29 seconds enjoys better margins when we go up the KV glass ladder. I hope I have answered your question. 45:36 45 minutes, 36 seconds Yes. Yes. Understood. And um also uh you mentioned actually I couldn't hear your voice was breaking. You mentioned that 45:43 45 minutes, 43 seconds our quarterly intake for revenue is 700 crores and how much do we expect that going forward? 45:52 45 minutes, 52 seconds Uh ma'am it'll be very difficult to give you a forward uh guidance on the on the revenue front. Our quarterly intake of 45:59 45 minutes, 59 seconds orders is 764 uh 7 approximately 700 kores uh as we speak right now. However, 46:07 46 minutes, 7 seconds uh to going forward, we have been maintaining that there is a 40% growth ratio that uh Atlanta has always been 46:15 46 minutes, 15 seconds maintaining uh historically and we intend to continue with the same 40% this year. Nothing less than 40% is what 46:22 46 minutes, 22 seconds we would expect. We are at about 33% as on today. 46:29 46 minutes, 29 seconds Okay, understood. Thank you so much. Thank you. 46:35 46 minutes, 35 seconds Thank you. The next question is from the line of Bal Subramanyan from Aryan Capital. Please go ahead. 46:42 46 minutes, 42 seconds Good morning sir. Uh congratulations for a good set of numbers. Sir, earlier you have mentioned uh engagement with hypers 46:49 46 minutes, 49 seconds scale data center developers. What technical specifications uh uh uh they are demanding and how does our product 46:57 46 minutes, 57 seconds portfolio align with that? And secondly, I think we also evaluating uh radiators and tanks integrations. Is there any 47:05 47 minutes, 5 seconds plan for for a kex for these uh backward integrations and is there any cost savings are expected uh uh because of this uh insourcing? 47:17 47 minutes, 17 seconds Uh on the technology front, Atlanta is well equipped for supplying transformers uh to data centers. Uh we have been 47:26 47 minutes, 26 seconds continuously quoting on inquiries. These inquiries do take time to find. Yes, there will be a separate set of quality requirement on the tank and radiator 47:34 47 minutes, 34 seconds front. Uh we are also in the process of uh doing a backward integration capex which is also disclosed uh in the DRP 47:42 47 minutes, 42 seconds that we file with. Uh the backward integration projects are under planning stage as of now and we intend to start 47:50 47 minutes, 50 seconds the the possibly by Q1 of next year. 47:57 47 minutes, 57 seconds Okay sir. Sir, how does the order intake pipeline uh for next uh uh FI27 especially for uh renewables uh uh compared to traditional grid projects? 48:08 48 minutes, 8 seconds You could talk about inverter 2D uh transformers uh uh order pipeline especially. 48:16 48 minutes, 16 seconds uh the inverter duty transformers that order intake that we have uh is is sufficient for the company till our unit six which we have recently started 48:24 48 minutes, 24 seconds construction for inverter duties comes up. Uh once the unit is started we would be opening our floodgates also for incremental floodgates for the add 48:33 48 minutes, 33 seconds orders. Uh the inquiry pipeline will continue to be the same till we take a strategic call of not to take I mean to start taking more of 400 class orders. 48:44 48 minutes, 44 seconds uh a 600 to 700 cr order pipeline on quarterly basis is sufficient enough to keep the facilities the existing unit 48:53 48 minutes, 53 seconds one two and three running in running condition. Um once we develop the first 400 KB prototype is when the strategic 49:00 49 minutes call would be there in place to start taking further 400 KB class orders and yet the pipelines of 400 KB class is is 49:08 49 minutes, 8 seconds significantly larger than the lower KB segments. Got it sir. Thank you. 49:20 49 minutes, 20 seconds Thank you. A reminder to all to limit their questions to two per participant. 49:25 49 minutes, 25 seconds If you have a follow-up question, please rejoin the queue again. The next question is from the line of Jam from Sarro Investment. Please go ahead. 49:34 49 minutes, 34 seconds Hi, uh congratulations on a great set of numbers. Um I just wanted to understand the finance cost which has kind of gone 49:44 49 minutes, 44 seconds up substantially. So for the first half if I look at it it was about 20 crores and for the quarter three also it is 49:51 49 minutes, 51 seconds about 20 crores and I think most of the IPO uh proceeds have been utilized could help going forward what would the 49:58 49 minutes, 58 seconds finance cost and what is the current debt levels of the company that would be great. 50:05 50 minutes, 5 seconds Yeah. Uh Jam may decide uh sir finance cost for Q3 is 20 crores. It has gone up 50:12 50 minutes, 12 seconds because of the interest cost incurred on Tam loan which was taken for Vot and BTW acquisition. However, as informed uh 50:22 50 minutes, 22 seconds during our Q2 earning call as well, we have repaid Votam loan fully and uh we have also repaid part of the uh loan 50:31 50 minutes, 31 seconds which was taken for acquisition. Current long-term date sitting on the book as on 31st December is 65.57 50:38 50 minutes, 38 seconds kores. Uh this is primarily for uh the loan which was taken for BTW acquisition and working capital uh short-term loan 50:48 50 minutes, 48 seconds uh it is uh 120 kores as on 31st December totalies to 186 crores as on 31st December. 50:58 50 minutes, 58 seconds So going forward do we see any incremental reduction in debt or are we comfortable with this level of debt and 51:05 51 minutes, 5 seconds what would the interest cost uh on a sustainable basis be? I understand that probably quarter 3 is a aberration but 51:13 51 minutes, 13 seconds what would it be going from we expect after uh repaying uh few of the long-term debate our finance cost 51:22 51 minutes, 22 seconds will come down during Q4. Uh however uh this 65 cr uh long-term debt we we 51:31 51 minutes, 31 seconds project and we wish to repay during this uh fiscal year only. Okay. 51:39 51 minutes, 39 seconds Understood. Um and I also wanted to understand regarding an increase in the employee cost quarter on quarter also 51:46 51 minutes, 46 seconds and year on year. So u as well as the depreciation. So uh what is the reason 51:53 51 minutes, 53 seconds for particularly for employee cost first if you could explain why why has it increased are we and where are we 52:00 52 minutes essentially what level of management uh or which particular uh function sales function or somewhere else that we are 52:09 52 minutes, 9 seconds uh probably adding if you could provide some texture that would be helpful and also for the depreciation does it account for the BTW facility as well for 52:18 52 minutes, 18 seconds Q3 The consolidated balance sheet would definitely account for the BGW depreciation also. Uh to answer your 52:27 52 minutes, 27 seconds question, the depreciations are basically coming in as calculated by chartered accountants. Uh the employee the reason of employee costs going up is 52:35 52 minutes, 35 seconds new new hiring for unit four and unit 5 which were there also partially there in Q1 then in Q2 and then incrementally in 52:44 52 minutes, 44 seconds Q3. Also to let you know the uh Q3 numbers also account for the increment 52:51 52 minutes, 51 seconds cycles and the areas paid to uh the team members who are there who are there in the company. Uh we would certainly be 53:00 53 minutes partial increment cycles have kicked in partial increment cycles will be kicking in in Q4 uh for uh for the balance team members. 53:10 53 minutes, 10 seconds Got it. And what is the current order pipeline across the board that we are uh participating in? And what is the 53:18 53 minutes, 18 seconds typical run rate win rate for Atlanta or the pipeline is close to 10,000 53:27 53 minutes, 27 seconds crores sir and we have been witnessing a hit ratio of close to 10 to 15% uh in this particular year. 53:36 53 minutes, 36 seconds Understood. Got it. Those were my questions. Thank you and all the very best. Thank you. 53:44 53 minutes, 44 seconds Thank you very much ladies and gentlemen. That was the last question for today. I would now like to hand the conference over to Mr. Nil Gupesh Pip 53:52 53 minutes, 52 seconds Patiel for the closing comments. Thank you and over to you sir. 53:58 53 minutes, 58 seconds Thank you everyone for joining and for your valuable suggestions and questions and thank you for your confidence in the company. Uh thanks everyone. 54:08 54 minutes, 8 seconds Thank you very much on behalf of Atlanta Electricals Limited. That concludes this conference.