Bigbloc Construction Limited — Q3 FY26

Bigbloc Construction Ltd Q3 FY2025-26 Earnings Conference Call https://www.youtube.com/watch?v=CV-fKa-YDjg Published: 3 months ago

0:00 Ladies and gentlemen, good afternoon and welcome to the Big Block Construction Limited Q3 and Magnam F526 earnings 0:08 8 seconds conference call. As a reminder, all participant lines will remain in the listenon mode and there will be an opportunity for you to ask questions after the presentation concludes. 0:19 19 seconds Should you need assistance during the conference call, please signal the operator by pressing star then zero on your touchstone telephone. 0:27 27 seconds Please note that this conference is being recorded. 0:31 31 seconds I will now hand the conference over to Mr. Mohit Sabu, the chief financial officer for opening remarks. Thank you and over to you sir. 0:41 41 seconds Good afternoon everyone. It is my pleasure to welcome you all to Big Block Construction Limited earnings conference call for the third quarter and 9 months ended 31st December 2025. 0:52 52 seconds Thank you for joining us today. I'll take you through our financial and operational performance for the quarter and 9 months followed by key business 1:00 1 minute updates. The third quarter marks a notable improvement in our overall performance. Construction activity gained strong momentum during the 1:08 1 minute, 8 seconds quarter as post monsoon demand recovered across key markets. This favorable environment combined with improved 1:14 1 minute, 14 seconds execution across our facilities enabled us to deliver our best quarterly performance to date. For Q3 FY26, 1:23 1 minute, 23 seconds consolidated revenue from operations reached rupees 728 million, marking the highest quarterly revenue in the company's history. This represents a 1:32 1 minute, 32 seconds growth of 28.1% compared to the same period last year and 8.2% sequentially. 1:39 1 minute, 39 seconds This growth was driven primarily by a 38% increase in sales volume compared to the same period last year, which reached 2 lakh 14,643 1:48 1 minute, 48 seconds cubic m for the quarter. For the 9-month period, revenue from operations was rupes 1965 million reflecting a growth of 22.8% over 9 months FY25. 2:01 2 minutes, 1 second On the profitability front, the quarter delivered a margins. EIA for Q3 FY26 was 2:08 2 minutes, 8 seconds rupees 81 million up 31.8% yearonear with margins expanding to 11.1% 2:15 2 minutes, 15 seconds compared to 2.8% and 10.8% 8% in Q2 FY26 and Q3 FY25 respectively. 2:23 2 minutes, 23 seconds The margin expansion was primarily driven by improved capacity utilization, better price realizations and a more efficient cost structure. Furthermore, 2:32 2 minutes, 32 seconds the company also returned to profitability during the quarter, reporting a profit after tax of rupees 4 million. From an operational standpoint, 2:40 2 minutes, 40 seconds capacity utilization improved to 67% in Q3 FY26 compared to 62% in the previous quarter and 53% in the same quarter last 2:49 2 minutes, 49 seconds year. Higher utilization levels across facilities has lowered fixed cost per unit and supported margin recovery. 2:58 2 minutes, 58 seconds At our JV facility CM big block construction technologies capacity utilization has continued its upward 3:04 3 minutes, 4 seconds trajectory reaching 51% in Q3 FY26 as compared to 43% in the previous quarter. 3:11 3 minutes, 11 seconds Acceptance of the large format wall panels is steadily increasing among contractors and developers particularly for industrial and commercial projects. 3:20 3 minutes, 20 seconds We are also witnessing a growing pipeline of inquiries and we expect to receive new order flows in the coming quarters. We have also been uh able to 3:29 3 minutes, 29 seconds click a few big clients and customers in the wall panel segment. On the strategic front, I'm pleased to share that the company recently secured a significant 3:38 3 minutes, 38 seconds purchase order from Nars and Tubro for the supply of A blocks. This order not only reflects the quality and consistency of our products but also 3:47 3 minutes, 47 seconds strengthens our presence in large infrastructure and institutional projects. 3:52 3 minutes, 52 seconds Additionally, trial runs for our construction chemical facility at Omega have commenced successfully and we expect to begin commercial production 3:58 3 minutes, 58 seconds soon. This will mark an important step in diversing our product portfolio and tapping into complimentary segments within the building materials industry. 4:07 4 minutes, 7 seconds Sustainability remains a core focus area for the company. The contribution of renewable energy to our total power consumption has increased to 36% during 4:16 4 minutes, 16 seconds the quarter, up from 26% in the previous quarter. 4:21 4 minutes, 21 seconds This increase is a result of enhanced solar power installations across our facilities and reflects our commitment to reducing carbon emissions while also 4:29 4 minutes, 29 seconds lowering energy costs for for the overall long term. At the industry level, construction activity is expected to remain supporting in the upcoming 4:38 4 minutes, 38 seconds quarters. The government's continued emphasis on affordable housing, infrastructure development, and urban redevelopment is driving demand for 4:46 4 minutes, 46 seconds modern building materials. Looking ahead, our priorities are centered on sustaining momentum in capacity utilization, scaling up AC wall panel 4:54 4 minutes, 54 seconds operations and commencing commercial operations across our uh construction chemicals manufacturing setup. With 5:02 5 minutes, 2 seconds demand conditions improving, we are confident of maintaining this positive trajectory and delivering improved performance in the quarters ahead. With 5:10 5 minutes, 10 seconds that, I conclude my remarks and we can now open the floor for question answers. 5:17 5 minutes, 17 seconds Thank you ladies and gentlemen. We will now begin with the question and answer session. Anyone who wishes to ask a 5:24 5 minutes, 24 seconds question may press star and one on their touchstone telephone. If you wish to remove yourself from the question queue, 5:31 5 minutes, 31 seconds you may press star and two. Participants are requested to use their handsets while asking a question. 5:39 5 minutes, 39 seconds Ladies and gentlemen, we will wait for a moment while the question Q assembles. 5:51 5 minutes, 51 seconds Ladies and gentlemen, if you wish to ask a question, please press star and one. 6:04 6 minutes, 4 seconds We take the first question from the line of Presen who is an individual investor. Please go ahead. 6:12 6 minutes, 12 seconds Uh hi sir am I audible? Yes. Hi sir. Am I audible? Yeah. 6:19 6 minutes, 19 seconds So so congratulations on these sets of results. I think the margin has improved significantly uh over the quarters. Uh I 6:27 6 minutes, 27 seconds had a very specific question. So one is that uh have the realizations improved uh in the last quarter and how are you looking at it going ahead? 6:39 6 minutes, 39 seconds So uh I had also mentioned in my earlier corn call that our first focus is towards improving caps utilizations and across all our three block facilities 6:48 6 minutes, 48 seconds our capsuity utilizations have almost reached uh 70% plus utilization levels only at the GV facility the utilization 6:54 6 minutes, 54 seconds is still around 50 51%age and in the last quarter Q3 we have been able to improve our realizations as well 7:02 7 minutes, 2 seconds and going forward looking at the uh you know demand trajectory we might be able to further improve on our realiz ations. 7:11 7 minutes, 11 seconds So can you give us some flavor as to what are the current prices uh which we are seeing because uh so before that sir can you clarify what percentage of uh 7:20 7 minutes, 20 seconds the revenue in this quarter was from construction chemicals. 7:26 7 minutes, 26 seconds So uh from the construction chemicals around uh 5 to 7% of the revenue was contributed by the construction chemicals and uh your query about uh 7:36 7 minutes, 36 seconds increase in realization. So uh I think the average realization has just gone up by around uh 2 to 3%age for this quarter. 7:47 7 minutes, 47 seconds Okay. Okay. Got it sir. So uh so uh I wanted to understand so our revenue has increased by only 5 crores uh but our eida has increased by almost 4 crores. 7:59 7 minutes, 59 seconds So is there something on the cost front as well which has uh changed uh versus last quarter. 8:07 8 minutes, 7 seconds So uh you know uh apart from the increase in revenue there has been an increase in realizations as well and as 8:14 8 minutes, 14 seconds we you know uh improve our utilization levels our operation cost also consequently goes down uh we are able to 8:22 8 minutes, 22 seconds save on the overall uh uh variable cost also to a certain extent and fixed cost to a big extent and uh from Q1 to Q3 we 8:31 8 minutes, 31 seconds have seen almost a uh 10 to 12% jump in caps utilization And that's how why how our realizations as well as AIDA margins 8:40 8 minutes, 40 seconds have improved drastically over the last two quarters. 8:45 8 minutes, 45 seconds Uh yes. Uh sure. Uh okay sir. And currently can you let us know what is the capacity utilization in the WPI plant? 8:55 8 minutes, 55 seconds So for the last quarter I think the WPI plant caps utilization was approximately at around 70%age. 9:05 9 minutes, 5 seconds Okay. 70%. Okay. 9:08 9 minutes, 8 seconds And I think the same numbers are mentioned in our results as well. 9:14 9 minutes, 14 seconds For QT it was around 58%age for the Wii plant. 9:21 9 minutes, 21 seconds Okay. Wii plant percentage I thought was not mentioned sir but okay I'll just check. Uh that's in the holding company 9:31 9 minutes, 31 seconds only right? The Wii plants. Yes, that's in the parent holding. 9:37 9 minutes, 37 seconds Okay. Not sir. Uh what is uh so right now we are saying sorry you're not audible now. 9:49 9 minutes, 49 seconds Sir the participant has left the question queue. 9:55 9 minutes, 55 seconds Ladies and gentlemen, if you wish to ask a question, please press star and one. 10:07 10 minutes, 7 seconds Once again, a reminder, ladies and gentlemen, if you wish to ask a question, please press star and one. 10:21 10 minutes, 21 seconds We take the next question from the line of Ashwat Rajan from Aryan Capital. Please go ahead. 10:27 10 minutes, 27 seconds Yeah. Thank you for the opportunity. I hope I'm audible. Yes, you're audible. 10:34 10 minutes, 34 seconds Yeah. So, uh question next are branded the utilization levels 10:43 10 minutes, 43 seconds across our plans. Sorry to interrupt but your voice is somehow not very clear. Yes. 10:51 10 minutes, 51 seconds Is it better? I'm audible now. Hello. Could you speak a bit louder? Yeah, I'm audible now. Yes, that's better. 11:00 11 minutes Yeah. I just wanted to understand what kind of utilizations level are we looking at uh especially uh in our Ahmedabad and uh Ramsodi plants. Going ahead. 11:13 11 minutes, 13 seconds So uh Mnabas plant last quarter caps utilization was around 80 81%age and the Ramo city plant last quarter cap 11:21 11 minutes, 21 seconds utilization is around 51%age uh I think uh on a quarteronquarter basis on a long-term annual basis uh the 11:29 11 minutes, 29 seconds average utilization for this sort of industry we calculate 80 85% as the optimal and uh star big block which is 11:36 11 minutes, 36 seconds uh the Ahmedabad plant uh is already at around 80 8 uh 85% for the last quarter 11:43 11 minutes, 43 seconds And uh the Ramos city plan we intend to get to uh 80%age in the next uh one or two quarters. 11:53 11 minutes, 53 seconds Okay. and any any uh reason why we see this jump in utilization in terms of 12:01 12 minutes, 1 second so we are able to uh we had increased our capsities uh by drastical level in 12:08 12 minutes, 8 seconds going from 550,000 to almost 1.3 million and uh if we see on a quarteron quarter I think Q1 our capacity utilization on a 12:15 12 minutes, 15 seconds consolidation basis was approximately 53 which went up to 62 in Q2 and 67 in Q3 12:22 12 minutes, 22 seconds so we are just targeting ing newer and markets as well as existing markets with more client penetration and for the wall 12:30 12 minutes, 30 seconds panel space as well we have been able to cater to lots of new different customers and are continuously seeing an increase in customer base as well as inquiries so 12:39 12 minutes, 39 seconds looking at that going forward we should be able to better scale up our uh utilization levels 12:46 12 minutes, 46 seconds okay thank you and I'm assuming now we don't have any there is could you elaborate on the same 12:54 12 minutes, 54 seconds So for the capeex uh the construction chemicals plant is also almost on the verge of completion. So there's no much 13:01 13 minutes, 1 second capeex funding over there and uh since uh we have already reached almost 67% caps utilization in this quarter. We are 13:09 13 minutes, 9 seconds planning to take up the expansion for the facility in MP for which land is already acquired and we are in the uh 13:18 13 minutes, 18 seconds you know uh process of doing negotiations with the installing uh contracting partners for the construction as well as for the machinery suppliers from China. 13:31 13 minutes, 31 seconds Okay. And uh we we see this commencing on on this quarter the capeex pretty much just mentioned. 13:39 13 minutes, 39 seconds So the empty plan cex uh we intend to start uh hopefully in the running quarter and uh the planned 13:47 13 minutes, 47 seconds operationalization will take a period of almost uh 10 to 12 months. Okay. Okay. Thank you. I'll get back. 13:55 13 minutes, 55 seconds Thank you. 13:58 13 minutes, 58 seconds Thank you ladies and gentlemen. If you wish to ask a question, please press star and one. 14:05 14 minutes, 5 seconds We take the next question from the line of Jes from trietra asset managers. Please go ahead. 14:14 14 minutes, 14 seconds Hi sir, my question is the AC wall panel business reached 51% utilization in Q3 14:23 14 minutes, 23 seconds and given the first mover advantage what are the primary adoption Bes preventing 14:30 14 minutes, 30 seconds the segment from reaching the like 60 or 60 65% plus utilization level seen in the core A block business. 14:41 14 minutes, 41 seconds So the AC wall panel business uh the uh capsuity utilization which I mentioned of 51% was for that particular plant and 14:49 14 minutes, 49 seconds that plant has a total installed capacity of 250,000 cubic m peranom which is a funible capacity between 14:56 14 minutes, 56 seconds blocks and panels and uh the breakup for blocks and panels I think panels utilization is so far around 10% and 15:03 15 minutes, 3 seconds rest 40% utilization is uh from the block space and uh on a quarteronquarter basis we are seeing new inquiry from 15:11 15 minutes, 11 seconds lots of different customers across the country and since we are the early movers in that space and we are the only people providing a panel which is up to 15:19 15 minutes, 19 seconds a height of 6 m you know uh we are able to click some good potential uh projects and uh we should be able to keep on 15:28 15 minutes, 28 seconds improving the capsu utilization in that plant and improving the sales of a wall panels over the next three to four 15:35 15 minutes, 35 seconds quarters to reach 30 40% plus okay sir Oh, fair enough. 15:49 15 minutes, 49 seconds Thank you. 15:51 15 minutes, 51 seconds Ladies and gentlemen, if you wish to ask a question, please press star and one. 16:05 16 minutes, 5 seconds Once again ladies and gentlemen if you wish to ask a question please press star and one. 16:13 16 minutes, 13 seconds We take the next question from the line of Ashwat Rajan from Arian Capital. Please go ahead. Yeah thank you for the followup. 16:22 16 minutes, 22 seconds Uh I just wanted to understand if we do we have any ordering activity or uh any order book that we foresee coming in uh especially from any real estate player. 16:36 16 minutes, 36 seconds So uh this is a bulky product and uh you know we don't have any uh bulk orders on 16:44 16 minutes, 44 seconds hand as such. We generally have an order book of around uh 3 to 5 days which had gone down to almost uh 1 to two days in Q1 of uh the current year. So the order 16:53 16 minutes, 53 seconds book has been improving and we keep on getting bulk orders from select few customers the likes of L&T or uh you 17:00 17 minutes know a few big corporates who place bulk order which is for a delivery schedule of up to 6 to9 months but apart from that on a routine basis we generally 17:08 17 minutes, 8 seconds keep on getting monthly purchase orders or weekly purchase orders from majority of our clients. 17:15 17 minutes, 15 seconds Okay. Okay. Thank you. 17:22 17 minutes, 22 seconds Thank you. Ladies and gentlemen, if you wish to ask a question, please press star and one. 17:32 17 minutes, 32 seconds We take the next question from the line of Ajit Si from Ieko Quantum Solutions. Please go ahead. 17:39 17 minutes, 39 seconds Yeah, thanks for the opportunity. So uh in AAC block we are around 67 67% utilization. So what kind of utilization 17:47 17 minutes, 47 seconds we are expecting to end in FY26 and what kind of utilization we can do in FY27. 17:56 17 minutes, 56 seconds So uh uh our capacity utilization for Q3 was around 67% and consolidated for the current uh 9 months is around 60 61%age. 18:06 18 minutes, 6 seconds I mean uh for the current year I think we'll close uh average utilization levels of 63 64% for the entire year. Q4 18:15 18 minutes, 15 seconds utilization should be hopefully upwards of Q3 utilization levels and for FY27 we intend to uh reach capit utilizations of 18:24 18 minutes, 24 seconds almost 70% plus uh okay and uh what kind of IITA margin 18:32 18 minutes, 32 seconds you are expecting in FY26 as well as in FY27. 18:38 18 minutes, 38 seconds So, AITA margins had uh dropped down drastically over uh the last one year because of increased competition as well 18:45 18 minutes, 45 seconds as uh a little bit of a slowdown in the real estate segment. But uh since last quarter, we have been seeing improved 18:52 18 minutes, 52 seconds demand as well as uh uh you know we have spread our uh market coverage as well and that's how we have been able to 18:59 18 minutes, 59 seconds scale up our volumes and also improve our AIDA margins uh on a long-term basis. I've always said the teida margins of around uh anywhere around 15 19:07 19 minutes, 7 seconds to 20% is uh easily uh sustainable in the industry and hopefully we intend to reach those margins in the upcoming quarters. 19:17 19 minutes, 17 seconds Okay. Thank you. Thank you. 19:23 19 minutes, 23 seconds Thank you ladies and gentlemen. If you wish to ask a question, please press star and one. 19:39 19 minutes, 39 seconds Ladies and gentlemen, a reminder. If you wish to ask a question, please press star and one. 19:57 19 minutes, 57 seconds The next question comes from the line of Shrian Koshik who is an individual investor. Please go ahead. 20:04 20 minutes, 4 seconds Uh yeah. Hi. Am I audible? Yes, you're audible. 20:11 20 minutes, 11 seconds Yeah. Uh sir, uh my first question is regarding the auditor's qualification on the non-compliance with uh India's 20:19 20 minutes, 19 seconds uh 19 for employee benefits. So why hasn't the company approved the postmployment benefits and long-term benefits on the actual basis and what is 20:28 20 minutes, 28 seconds the estimated financial impact if corrected? 20:33 20 minutes, 33 seconds So uh for the uh NDS uh ind for the employee benefit the actual validation we are getting it done on an annual 20:41 20 minutes, 41 seconds basis and instead of a quarterly basis and all that uh needs to be provided it will be provided in the annual accounts. 20:48 20 minutes, 48 seconds The same was done in the last financial year and it'll be done again at the close of this financial year. So we don't see any major impact of uh you 20:57 20 minutes, 57 seconds know any qualification from the auditor for NDS19. 21:03 21 minutes, 3 seconds Okay. Thank you. And my second question regarding uh this are you anyway 21:10 21 minutes, 10 seconds contributing to PMUI scheme in which 57,000 crores allocated in the unit budget FI26. 21:19 21 minutes, 19 seconds So yes uh there are various government schemes which are running for construction be PMA or SSA which is server shikaba going on in Gujarat. 21:29 21 minutes, 29 seconds There are various uh cow as well as uh uh uh goat sheds projects going on in Maharashtra and uh kanya shika parish 21:38 21 minutes, 38 seconds projects going on in Madhya Pradesh. So we have been uh providing our material to all such government schemes and projects uh which come in our territory which we are able to tap. 21:50 21 minutes, 50 seconds Okay. Right. Thank you. And uh I just wanted to get an estimate uh as in can 21:59 21 minutes, 59 seconds you give me some numbers regarding the capex in this new territory of Madhya Pradesh? 22:07 22 minutes, 7 seconds So uh we are planning to put up a plant in Madhya Pradesh with an installed capacity of around uh 2 lakh to 2 lakh 50,000 cubic meters peranom and the 22:16 22 minutes, 16 seconds total capeex for this facility will be in the t of almost 75 to 80 crores 22:23 22 minutes, 23 seconds okay which will get executed within next year or so right yes which will be done over the next uh 12 months approximately Okay. 22:36 22 minutes, 36 seconds Okay. Okay. And um any uh estimate on our carbon credit uh accumulations? 22:45 22 minutes, 45 seconds So uh in terms of the carbon credit, we have some accumulated credits uh the Omaro plant which was uh belongs to Big Block Construction Limited. We have 22:54 22 minutes, 54 seconds carbon credits uh uh in stock which are not yet issued because uh there are some delays on part of Vera because of 23:02 23 minutes, 2 seconds additional audits etc being done by various carbon trade author uh auditing authorities and I think we have a uh 23:10 23 minutes, 10 seconds pending credits to be issued was almost 1 lakh to 1 lakh 50,000 credits plus and similarly for star block plant as well 23:17 23 minutes, 17 seconds we are uh have some pending credits to be issued similarly the uh plant at Vada which is big block building elements 23:25 23 minutes, 25 seconds that also has uh it's under the process of registration for carbon credit we have not we have already applied for the same but uh the final registration 23:34 23 minutes, 34 seconds certificate is yet to be received by us and the carbon markets are a little slow currently that's why we are not uh uh 23:41 23 minutes, 41 seconds actively keen on getting those credits issued or sold right 23:49 23 minutes, 49 seconds okay that's it from my side thank Thank you. 23:56 23 minutes, 56 seconds Thank you. Ladies and gentlemen, if you wish to ask a question, please press star and one. 24:08 24 minutes, 8 seconds Ladies and gentlemen, a reminder, if you wish to ask a question, please press star and one. 24:22 24 minutes, 22 seconds Ladies and gentlemen, if you wish to ask a question, please press star and one. 24:30 24 minutes, 30 seconds As there are no further questions from the participant, I now have the conference over to Mr. Mohit Sabu for his closing comments. 24:38 24 minutes, 38 seconds Thank you all for taking the time to join us today and for your continued interest in Big Block Construction Limited. As we continue to navigate opportunities ahead, we remain committed 24:47 24 minutes, 47 seconds to delivering consistent growth and value in the coming quarters. As always, if you have any further questions, please feel free to reach out to our 24:54 24 minutes, 54 seconds investor relations advisor, Churchgate Partners, and we'll be happy to address your queries. Thank you. Have a good day. 25:02 25 minutes, 2 seconds Thank you. On behalf of Big Block Construction Limited, that concludes this conference call. Thank you for joining us and you may now disconnect your line.