Patel Engineering Ltd — Q4 FY26

Patel Engineering Ltd Q4 FY2025-26 Earnings Conference Call https://www.youtube.com/watch?v=GAGfBDr2ONE Published: 14 hours ago

0:01 1 second Ladies and gentlemen, good day and welcome to the Patel Engineering Limited Q4 FYI 2026 earnings conference call 0:08 8 seconds hosted by Valerm Advisers. As a reminder, all participant lines will be in the listenon mode and there will be 0:15 15 seconds an opportunity for you to ask questions after the presentation concludes. Should you need assistance during this conference call, please signal an 0:23 23 seconds operator by pressing star and then zero on your touchtone phone. Please note that this conference is being recorded. 0:32 32 seconds I now hand the conference over to Miss Purangi Jane from Valer Advisors. Thank you and over to you ma'am. 0:40 40 seconds Thank you. Good evening everyone and a very warm welcome to you all. My name is Purwangi Jen from Valerim Advisors. We represent the investor relations of 0:48 48 seconds Patel Engineering Limited. On behalf of the company and valerum advisors, I would like to thank you all for participating in the company's earnings 0:55 55 seconds conference call for the fourth quarter and financial year 2026. 1:00 1 minute Before we begin, let me mention a short cautionary statement. Some of the statements made in today's earnings call may be forward-looking in nature. Such 1:08 1 minute, 8 seconds forward-looking statements are subject to risk and uncertaintities which could cause actual results to differ from those anticipated. 1:16 1 minute, 16 seconds Such statements are based on management's belief as well as assumptions made by and information currently available to the management. 1:24 1 minute, 24 seconds Audiences are cautioned not to place any undue reliance on these forward-looking statements in making any investment decision. The purpose of today's 1:32 1 minute, 32 seconds earnings call is purely to educate and bring awareness about the company's fundamental business and financial quarter under review. I would now like 1:40 1 minute, 40 seconds to introduce you to the management team joining us on today's call. We have with us Mrs. Kavita Shirkar, managing 1:47 1 minute, 47 seconds director and Mr. Rahul Agarval, Chief Financial Officer. Without any delay, I request Miss Kavita to start with her 1:55 1 minute, 55 seconds opening remarks. Thank you and over to you ma'am. Thank you ma'am. 2:00 2 minutes Good evening everyone and thank you for joining us today for Patel Engineering's Q4 and FI26 earnings call. I extend a 2:09 2 minutes, 9 seconds warm welcome to all our stakeholders and analysts joining us here. We truly appreciate your continued trust, 2:17 2 minutes, 17 seconds encouragement and support towards Patel Engineering. 2:21 2 minutes, 21 seconds We have uploaded our investor presentation along with the financial results on the stock actions for your reference. I will begin by taking you 2:30 2 minutes, 30 seconds through the key highlights for the year, the progress we have made across our projects and share our outlook on the infrastructure sector and growth 2:39 2 minutes, 39 seconds opportunities ahead. Following this, our CFO, Mr. Rahul Lagarwal will walk you through the financial performance in 2:47 2 minutes, 47 seconds detail. FI26 has been another important year in Patel Engineering's journey. 2:54 2 minutes, 54 seconds Despite a competitive environment and industry-wide challenges during the year due to geopolitical situations and other 3:02 3 minutes, 2 seconds factors, we continued to focus on disciplined execution, selective bidding, balance sheet strengthening and 3:10 3 minutes, 10 seconds building a high quality order book with projects where our execution expertise creates a competitive advantage. 3:18 3 minutes, 18 seconds Let me start with taking you through the key developments and the order inflows during the year. During FI26, we secured 3:26 3 minutes, 26 seconds new orders worth around 4,400 crores across hydropower, urban infrastructure, irrigation and 3:33 3 minutes, 33 seconds other segments. This order means further strengthen our execution visibility over the coming years and reinforce our 3:41 3 minutes, 41 seconds position in complex infrastructure projects requiring strong engineering capabilities and large scale project management. 3:49 3 minutes, 49 seconds Speaking about the orders secured during the year, the largest order secured was the around rupes 1,300 crane dam project 3:58 3 minutes, 58 seconds from sitco in Maharashtra to improve the water supply in the region. The project involves construction of the dam along 4:05 4 minutes, 5 seconds with hydromechanical and electrical work including radial gates and allied infrastructure. 4:12 4 minutes, 12 seconds This project significantly strengthens our presence in Maharashtra and further enhances our positioning in the urban 4:20 4 minutes, 20 seconds infrastructure segment which we believe will continue to witness strong investments over the coming years. In 4:27 4 minutes, 27 seconds the hydropower segment, we secured around 700 cr Ho Ho hydropower project from Niko. 4:37 4 minutes, 37 seconds The scope includes civil and associated infrastructure work along with testing and commissioning of hydromechanical 4:45 4 minutes, 45 seconds systems for the 240 megawatt hydroelect electric project. 4:49 4 minutes, 49 seconds We also secured around 900 cr project being one of the package of renuki dam project from HTPCL. 4:58 4 minutes, 58 seconds The scope includes construction of major diversion tunnels, hydromechanical systems and associate infrastructure 5:05 5 minutes, 5 seconds work which further reinforces our strong hydropower expertise. 5:10 5 minutes, 10 seconds In Sikkim we secured the 240 crist 5 power station project from NHPC involving tunnel spillway construction 5:18 5 minutes, 18 seconds and associated infrastructure works. In the irrigation segment we secured around 5:25 5 minutes, 25 seconds 958 crd right bank main canal project from Maharashtra Krishna Valley Development Corporation. The project 5:33 5 minutes, 33 seconds includes development of pipe distribution network. Our share in this project is rupees 192 cr. 5:41 5 minutes, 41 seconds During the year we also secured two packages of 798 cr project which was for the coal mining contract in the area of 5:49 5 minutes, 49 seconds Madhya Pradesh where principal is southeast coal limited. 5:55 5 minutes, 55 seconds On the international front we secured rupees 231 cr to chilling hydro electric power project in Bhutan. The project 6:04 6 minutes, 4 seconds includes construction of diversion tunnels, road tunnels and hydromechanical works. This project is strategically important for us because 6:13 6 minutes, 13 seconds it further strengthens our international hydropower credentials and enables us to put our footprints in Bhutan where 6:21 6 minutes, 21 seconds substantial hydropower development opportunities are expected in coming years. 6:27 6 minutes, 27 seconds Overall, our order inflows during the year have been well diversified across sectors and geographies and provide 6:35 6 minutes, 35 seconds strong medium-term revenue visibility for the company. 6:39 6 minutes, 39 seconds With this as of March 31st 2026 our order book stands at rupes 15,19 cr. The 6:46 6 minutes, 46 seconds composition is hydropower 63% 16% is irrigation 5% tunneling 10% from urban 6:54 6 minutes, 54 seconds infrastructure and remaining 6% is roads and others. Further, we already started F527 on a positive note by by being 7:04 7 minutes, 4 seconds declared L1 for another 1,600 cr worth of order, which gives us good momentum entering the new financial year and 7:12 7 minutes, 12 seconds gives us confidence about future growth visibility. 7:16 7 minutes, 16 seconds The diversified order book positions us strongly across multiple infrastructure themes which are expected to drive India's next phase of infrastructure 7:24 7 minutes, 24 seconds growth. Apart from above, we have currently submitted tenders of around 6,000 crores which are currently under evaluation. 7:33 7 minutes, 33 seconds Further, we have identified an evaluated and immediate pipeline of around 20,000 Kores which we plan to actively pursue 7:41 7 minutes, 41 seconds over the next few months. Beyond this, there are another 40,000 K worth of projects to come up for breeding in next one year. Therefore, the opportunity 7:50 7 minutes, 50 seconds pipeline with your across sectors remains extremely strong. 7:55 7 minutes, 55 seconds Now let me share some key operational highlights and project execution updates during the year. As guided earlier 8:02 8 minutes, 2 seconds revenue in FI26 has crossed 5,000 K and we achieved revenue of Rs 5,000 5103 8:09 8 minutes, 9 seconds crores. During the quarter we witnessed consistent progress across all our project sites and several important 8:17 8 minutes, 17 seconds milestones were achieved. On the hydropower front, work at Subansari lower hydroelect electric project continues to progress well. With the 8:26 8 minutes, 26 seconds recent commissioning of unit 4, the project now has four operational units contributing 1,000 megawatt of clean 8:33 8 minutes, 33 seconds energy to the national grid. Work on the balance units is also progressing steadily. Civil work have been completed 8:41 8 minutes, 41 seconds after unit six and execution remains on track across the remaining sections of the project. All eight units are 8:49 8 minutes, 49 seconds expected to be operational in this financial year. 8:53 8 minutes, 53 seconds Another major achievement during the quarter came from our sitco treated water tunnel project. I am extremely 9:00 9 minutes proud to share that the project achieved a record tunneling progress of 812 m in a single month during January 2026 9:09 9 minutes, 9 seconds setting a national benchmark across TBM tunneling execution. 9:15 9 minutes, 15 seconds We also completed around 6.2 2 kilometers of tunneling and achieved a successful TVM breakthrough at the site 9:22 9 minutes, 22 seconds in this quarter. Our projects in Jammu and Kashmir particularly the Kiru and Quir HB projects are also witnessed 9:31 9 minutes, 31 seconds strong progress during the quarter with cons with concreting activities progress at full scale during FI26 9:39 9 minutes, 39 seconds across our maj major project site we executed more than 13.5 large cubic meters of concrete ink works and 9:48 9 minutes, 48 seconds completed reinforcement works of nearly 60,000 metric tons. 9:55 9 minutes, 55 seconds Now let me briefly touch upon the industry outlook and opportunities ahead. We remain highly optimistic about 10:02 10 minutes, 2 seconds India's infrastructure growth story. The union budget 2026 27 has further strengthened our 10:10 10 minutes, 10 seconds confidence across sectors where we operate. The government has increased plan capital expenditure to record 12.2 10:17 10 minutes, 17 seconds 2 lakh cr reaffirming it continued focus on infrastructure laid economic growth 10:24 10 minutes, 24 seconds Indian railways has received its highest ever allocation of 2.78 lakh per kilo importantly the government has announced 10:32 10 minutes, 32 seconds seven highspeed rail corridors across the country many of these corridors pass through difficult terrains including the 10:40 10 minutes, 40 seconds western grass in Himalayan region which will require significant tunneling and underground engineering expertise 10:48 10 minutes, 48 seconds This creates a very large long-term opportunity pipeline for us considering our capabilities in underground and complex tunneling work. 10:58 10 minutes, 58 seconds India is also witnessing rapid growth in metro infrastructure with the government continuing to invest heavily in urban 11:05 11 minutes, 5 seconds transport across major cities. Large metro projects are under implementation or planned across cities like Bengaluru, 11:13 11 minutes, 13 seconds Mumbai, Chennai, Pune, Hyderabad and Delhi. 11:16 11 minutes, 16 seconds These projects are expected to create significant opportunities in tunneling, underground stations and associated and 11:24 11 minutes, 24 seconds urban infrastructure works over the coming years. Similarly, the government is also focusing on RRT regional rapid 11:33 11 minutes, 33 seconds transit system projects which are being developed to improve connectivity between major cities and nearby regions. 11:40 11 minutes, 40 seconds These projects are expected to generate substantial opportunities in transportation, tunneling and underground infrastructure. 11:48 11 minutes, 48 seconds Now coming to hydropower, we continue to remain extremely positive on the hydropower opportunities both with India and internationally. 11:57 11 minutes, 57 seconds Agencies such as NHPC, SAVNL, NIPO and NTPC together have a very large upcoming pipeline exceeding 13 gawatt. 12:08 12 minutes, 8 seconds Some of the key projects expected to come up for beating in near-term include travel code project of 1856 megawatt, 12:16 12 minutes, 16 seconds Kalai 2 of 1,200 megawatt, Kamla of 1,720 megawatt. These projects are in 12:25 12 minutes, 25 seconds advanced stage of clearance and would be out for bidding very shortly. also projects like upper karnali of 900 12:33 12 minutes, 33 seconds megawatt, upper kubani 1,600 megawatt, kai 2 820 megawatt, Italian of 3,000 12:41 12 minutes, 41 seconds megawatt to come up for building in the near future. 12:46 12 minutes, 46 seconds In addition, pump storage projects are emerging as a major future opportunity. 12:52 12 minutes, 52 seconds The central electricity authority has outlined a road map targeting 100 gawatt 12:58 12 minutes, 58 seconds of farm storage capacity by 203536 which significantly expands the future 13:05 13 minutes, 5 seconds opportunity size for companies operating in hydro infrastructure and tunneling. 13:11 13 minutes, 11 seconds Internationally as well countries like Nepal and Bhutan continue to offer substantial untapped hydropower potential. 13:20 13 minutes, 20 seconds In the last quarter, we have been awarded a package in the Dorsuling project in Bhutan and have expected our 13:26 13 minutes, 26 seconds presence in the region as well. In Nepal, we continue to execute work at the Aruni hydropower project during the first quarter of FI27. 13:38 13 minutes, 38 seconds We have been declared lowest bidder L1 for the lower Aron project value at approximately 1,600 crores. 13:46 13 minutes, 46 seconds This project is very close to our existing Arunri project site giving us strong logistical and execution advantage. 13:55 13 minutes, 55 seconds Collectively Nepal and Bhutan have an untapped hydropower potential exceeding 70,000 megawatt and we will continue to 14:02 14 minutes, 2 seconds actively evaluate opportunities in this market. 14:07 14 minutes, 7 seconds Now what on the water infrastructure side the opportunity landscape remains highly attractive. The government's 14:14 14 minutes, 14 seconds national river linking program has now moved into active implementation phase. 14:19 14 minutes, 19 seconds The kane beta river linking project which is the first 30 identified interjin links major river linking 14:26 14 minutes, 26 seconds project has already commenced execution while DPR for several more linking projects are in advanced stages. 14:35 14 minutes, 35 seconds Simultaneously, Maharashtra's plan irrigation investments and enhance allocation under the general driven mission are expected to create 14:43 14 minutes, 43 seconds significant opportunities for our irrigation and tunneling business over the medium term. Now, let me briefly update you on the balance sheet and 14:52 14 minutes, 52 seconds asset monetization which was concluded during the year. Align with our strategy of monetizing approximately of around 15:00 15 minutes 150 cr of non-cur assets annually during FY 26. We successfully completed monetization of certain non-cor assets and realized approximately rupes 185 cr. 15:12 15 minutes, 12 seconds This included around 135 crores from lancet and around 50 cr through arbitration awards under ni. We also 15:21 15 minutes, 21 seconds successfully completed our right issue during the year. The inflows from the rights have been significant under our balance sheet. supported working capital 15:29 15 minutes, 29 seconds requirements for ongoing projects and enabled significant debt reduction of around 450 crores during the year. With 15:37 15 minutes, 37 seconds a stronger balance sheet and improved liquidity position today, we are well positioned to scale up execution across 15:46 15 minutes, 46 seconds newly secured and upcoming projects while maintaining financial discipline. 15:51 15 minutes, 51 seconds So to conclude, Patel Engineering enters F527 with a strong order book, improving execution momentum, a healthier balance 15:59 15 minutes, 59 seconds sheet and a very large opportunity pipeline across sectors. We remain committed to sustainable growth, discipline building and operational 16:08 16 minutes, 8 seconds excellence. With the recent order inflows and further order opportunities expected during FI27, we expect revenue 16:16 16 minutes, 16 seconds growth momentum to strengthen meaningfully from the second half of FI27 onward. Considering our current order book and strong future 16:25 16 minutes, 25 seconds pipeline, we expect FI27 revenue to grow by 10%. With that, I will now hand over 16:32 16 minutes, 32 seconds the call to our CFO, Mr. Rahul Aarwal, who will take you through the financial performance in greater detail. Thank you. 16:41 16 minutes, 41 seconds Thank you, Kavita. Good evening, everyone, and welcome to the earnings call. I'll now take you through the company's financial performance for Q4 16:49 16 minutes, 49 seconds and fullear FI26 on for Q4 on a consolidated basis. Our revenues at 1421 crores operating 16:57 16 minutes, 57 seconds advertise 215 crores with a margin of 15.14%. 17:02 17 minutes, 2 seconds Profit after tax it is at 71.5 cr compared to 32.8 cr in Q4 FI25. 17:09 17 minutes, 9 seconds On a standalone basis revenue is 1413 cr. Operating is 210 crores with a margin of 14.89% and profit after tax is 17:19 17 minutes, 19 seconds 96.9 cr compared to 36.61 cr in FY2 5 Q4. 17:25 17 minutes, 25 seconds Coming to financial performance for full year revenue from operations is at 5102 cr as compared to 5093 cr in FI25. 17:35 17 minutes, 35 seconds Operating AI is 684 crores with a margin of 13.41% 41% and profit after tax is 294 crores as compared to 242 crores in the previous year which is up by 21%. 17:46 17 minutes, 46 seconds On a standalone basis revenue is 566 crores as compared to 5,7 cr in FI25. 17:54 17 minutes, 54 seconds Operating AITA standard 659 crores with a margin of 13%. Profit after taxes 319 crores compared to 259 crores in FI25. 18:03 18 minutes, 3 seconds Sector wise revenue breakup is hydrop power 55% irrigation 23% tunneling 17% 18:11 18 minutes, 11 seconds roads urban and fry and others 5%. Now coming to debt and working capital the consolidated gross debt as of March 3126 18:19 18 minutes, 19 seconds is 1,187 crores compared to 1,645 crores at the end of FI25. Hence the 18:26 18 minutes, 26 seconds debt numbers have come down significantly by 458 crores as compared to the previous year. Majority of which has reduced in the last quarter due to 18:34 18 minutes, 34 seconds right isue. Planned advances as of March 3126 is 622 crores compared to 665 18:41 18 minutes, 41 seconds crores at the end of FY25. Debt to equity ratio has improved to 0.27 as compared to 0.43 as of March 25. 18:50 18 minutes, 50 seconds breakdown of debt. Uh out of the debt 847 crores is working capital and 340 crores is term debt 18:58 18 minutes, 58 seconds which includes OCD, NCDS and the project specific debt. The working capital the net working capital days is around 120 19:06 19 minutes, 6 seconds days and the net adjusted working capital is 106 days. 19:12 19 minutes, 12 seconds Now coming to the exceptional item during the quarter. So during the quarter we have provided for impairment of investments made in hydro 19:21 19 minutes, 21 seconds subsidiaries of approximately 56 crores considering the feasibility of revive uh revival in the near future 19:30 19 minutes, 30 seconds and in the quarter uh we have already uh signed the MOU which is for Gongri project. Further as part of our non-core 19:38 19 minutes, 38 seconds asset monetization strategy we have decided to sell our investments in a toll road project ACP tollway base where we have 32% stake we have received an 19:46 19 minutes, 46 seconds offer of rupes 55 cr for the same and hence provided for 30 crores being the difference between book value of investment and which was made in 20112 19:56 19 minutes, 56 seconds considering that any equity return from the SPV shall be possible only after repayment of the debt in the SPV in NPV terms this expected realization is 20:04 20 minutes, 4 seconds considered reasonable So the above monetization will be at towards our target monetization for 15200 crores during the year from 20:11 20 minutes, 11 seconds noncore assets. That concludes the financial overview. We are now happy to take any questions which you have. 20:19 20 minutes, 19 seconds Thank you very much. We will now begin with the question and answer session. 20:24 20 minutes, 24 seconds Anyone who wishes to ask a question may press star and then one on their touchstone phone. If you wish to remove yourself from the question queue, you may press star and two. 20:36 20 minutes, 36 seconds Participants are requested to use handsets while asking your question. 20:41 20 minutes, 41 seconds Ladies and gentlemen, we will wait for a moment while the question queue assembles. Again, to register, please press star and then one. 20:53 20 minutes, 53 seconds Your first question comes from British Sher from Lucky. Please go ahead. 21:01 21 minutes, 1 second Sir, what was the market share that you had in the hydropower order winds that you have which is 4,400 minus 800. So 21:09 21 minutes, 9 seconds about 3,600 crores of inflows. So what was the market share? 21:17 21 minutes, 17 seconds So see if you talk about the success ratio last year we uh if we exclude one large project of you know dbang 15 21:25 21 minutes, 25 seconds almost 16 17,000 cr then it is around 25 30%. And if you include that it is coming to around 12 13%. 21:35 21 minutes, 35 seconds So if it is 12% so which means closer to about 30,000 cr of inflows were given 21:43 21 minutes, 43 seconds and then with that one last project was 16,000. So with that project uh we lost the bid and why did we lose the bid? 21:55 21 minutes, 55 seconds So uh there was very competitive bidding done so we uh somebody took it at a very low value so we we didn't get it. 22:05 22 minutes, 5 seconds Okay. 22:06 22 minutes, 6 seconds Is it a new player or is it uh an old player? A new player. 22:13 22 minutes, 13 seconds Okay. The other thing is on the why have we taken this pole binding works this first standard I'm seeing you taking a ND project. 22:24 22 minutes, 24 seconds So we are trying to explore new opportunities and we got this project. Okay. 22:32 22 minutes, 32 seconds And this is a small project actually seven eight years. It's executable over 8 years. 22:41 22 minutes, 41 seconds Yeah. Yeah. 22:43 22 minutes, 43 seconds Okay. And my last question is uh uh what kind of what kind of inflows are expected this year? What kind of water finalizations are expected this year? 22:54 22 minutes, 54 seconds And you had given you know revenue guidance last year about not growing which happened the same. How do you see FI27 panning out? 23:06 23 minutes, 6 seconds This FY27 we expect around 10% growth in the revenue. 23:14 23 minutes, 14 seconds And on the order side, order side see this year is a good beginning. We are already L1 in 1,600 cr 23:22 23 minutes, 22 seconds worth of job. So we expect around 8,000 cr new order book during the year. 23:30 23 minutes, 30 seconds Okay. Okay. Thank you. Thanks. 23:35 23 minutes, 35 seconds Thank you. The next question comes from the line of Retesh Polaria with GI Capital. Please go ahead. 23:43 23 minutes, 43 seconds Yeah. Uh so just wanted to know uh about your uh exceptional items. Uh there is a uh debt 23:52 23 minutes, 52 seconds and advanced return off of 133 cr this year. Last year it was 270 280 crores. 23:59 23 minutes, 59 seconds So uh uh is there anything remaining uh to be return or uh this is uh end of it? 24:08 24 minutes, 8 seconds No this is there's nothing remaining to be written off. So last year we had done Vivas Vishwa settlements around 150 crores Vivas Vishwa settlements was uh 24:17 24 minutes, 17 seconds done for that that exceptional item was there. this year this quarter I have already explained because one two investment one is for hydro subsidiary 24:25 24 minutes, 25 seconds uh where we have revived one project and the other project we have uh thinking that you know it will take time so we have written of that and one is for the 24:34 24 minutes, 34 seconds toll road project where we have got an offer from the for 55 crores and investment was around 85 so we have provided that 24:42 24 minutes, 42 seconds and in the previous we had done some settlements for a litigation and also that provision was done so there is nothing remaining. 24:51 24 minutes, 51 seconds Okay. And uh uh also there is some uh excess credit return back of 100 cr. So 24:58 24 minutes, 58 seconds is there anything uh on that part uh still pending or uh even that is over? 25:05 25 minutes, 5 seconds No no everything is over. There's not not much excess credit return back of 100 cr this quart. I don't know from where you're getting it but 25:12 25 minutes, 12 seconds it's on cash flow statement. Uh there's a third last statement in the 25:19 25 minutes, 19 seconds right right right so that see basically what happens is the project which gets concluded during the year so from that 25:28 25 minutes, 28 seconds uh project whatever balances are there you know receivable payable that we have to write back and write off. 25:37 25 minutes, 37 seconds So where will be the corresponding entry for this? So that will be mostly other income. 25:44 25 minutes, 44 seconds Okay. 25:48 25 minutes, 48 seconds And uh you uh ma'am said uh that expected order wage of 8,000 cr. Uh if 25:56 25 minutes, 56 seconds you can uh give some more ideas uh what all the projects you are targeting. 26:03 26 minutes, 3 seconds So as we say 6,000 cr projects were already submitted which is under evolution. Another 20,000 K we have 26:11 26 minutes, 11 seconds identified which includes metro which includes hydro and irrigation projects where we are going to bid in near 26:18 26 minutes, 18 seconds future. Another 40,000 cr which will come up for bidding in next one year. So more or less it will remain in the sector where we operate in next year. 26:28 26 minutes, 28 seconds Okay that's it from my side. Thank you. 26:33 26 minutes, 33 seconds Thank you. The next question comes from the line of Vir Mahadeva with money grow. Please go ahead. 26:40 26 minutes, 40 seconds Hi, congratulations to the team on the stable results and particularly the high free cash flow generation. I wanted to understand um uh uh you know Rahul what 26:49 26 minutes, 49 seconds is driving this high free cash of 450 crores in FY26 and is that likely to continue going forward? 26:59 26 minutes, 59 seconds So the see we free cash flow we have come it is combination of you know what we have got from projects and noncore assets monetization. So we expect that 27:08 27 minutes, 8 seconds continue that should continue and and in that case given the high cash flow generation 27:15 27 minutes, 15 seconds the debt payown both from organic cash as well as the rights issue which I'm not sure if all the cash has already been used to pay off the term loans can 27:24 27 minutes, 24 seconds you guide us towards an interest cost for the next financial year the interest cost for the next financial 27:31 27 minutes, 31 seconds year overall may not you know uh change drastically because uh so whatever Ever it uh borrowing has been reduced this 27:39 27 minutes, 39 seconds year. New projects whatever we expect there will be some advances taken for that. So some interest will come for that. But what we expect is the interest 27:47 27 minutes, 47 seconds cost will not go up drastically from here. It will remain around that region. 27:52 27 minutes, 52 seconds But presumably you will also repay some principle right uh of the term loans. So that should come down 28:00 28 minutes if that will come down. So if you take new projects of around 8,000 around 8 to 10% advances may come for equipment and 28:08 28 minutes, 8 seconds for you know mobilization 7 800 cr advances will come and there will be repayments also. So overall we 28:15 28 minutes, 15 seconds don't see you know the interest cost going up. 28:19 28 minutes, 19 seconds Okay. And in terms of non-core monetizations, you've highlighted that you monetized 185 crores this year and 28:26 28 minutes, 26 seconds arbitration money was how much in FY26 and can you guide us towards those two numbers for 27 28:34 28 minutes, 34 seconds 27 we again consider around 150 200 crores will come from non-core assets all combined. We can't split it right 28:42 28 minutes, 42 seconds now between what will come from awards or what will come from other non-cores. 28:46 28 minutes, 46 seconds But this is our target is there that between you know all land bank and uh investments and arbitration awards we 28:54 28 minutes, 54 seconds should get between 150 to 200 cash at least. 28:57 28 minutes, 57 seconds So the 185 and 26 was land bank plus arbitration. 29:01 29 minutes, 1 second Yes. So 50 crores was for arbitration uh which we got against BG 135 crores was for land bank. 29:09 29 minutes, 9 seconds Understood. So you're guiding towards a similar number for next year between the two. Correct. Correct. 29:13 29 minutes, 13 seconds And that will be prioritized to repay term loan. I'm assuming correct correct so we have this year also right issue we have prioritized for 29:21 29 minutes, 21 seconds term loan so there was OCD there was IR on OCD also that is also repaid so it has primarily gone 29:29 29 minutes, 29 seconds any other OCDs outstanding in future years the balance OCD's outstanding is around 29:36 29 minutes, 36 seconds 120 cr in which year so that will we we will be repaying in some in FI27 some in FI28 29:45 29 minutes, 45 seconds earlier depending upon when the realization happens. Okay. So by 28 all should be repaid. Correct. Correct. 29:53 29 minutes, 53 seconds Okay. Sorry. Just last question. Uh two orders are I believe are coming up in Arunachal of 20,000 crores. Can you comment on that? Uh in terms of likely 30:02 30 minutes, 2 seconds timelines of bidding, likely timelines of awards etc. 30:08 30 minutes, 8 seconds Arunachal kamla I said like lower kamla. 30:13 30 minutes, 13 seconds So next 6 months it is going to come up for bidding. Okay. Okay. Thank you ma'am. All the best. 30:21 30 minutes, 21 seconds Thank you. 30:24 30 minutes, 24 seconds Thank you. Before we take the next question, a reminder to all the participants. You may press star and then one to ask a question. 30:34 30 minutes, 34 seconds The next question comes from the line of Rajie, an individual investor. Please go ahead. 30:41 30 minutes, 41 seconds Yeah, thank you for the opportunity. My question was uh regarding the promoter pledge. So I think over the last one one 30:48 30 minutes, 48 seconds and a half year uh the management has been commenting that the promoter pledge will come down after March. So can we have an update on that please? 31:00 31 minutes So now post March results we will be contacting the lenders and then we'll update you. 31:06 31 minutes, 6 seconds But that you have said earlier. So by when can that come down and by what percentage? So could you give a timeline to that? 31:15 31 minutes, 15 seconds So at present we will not be able to give you the exact timeline but uh our endeavor is to reduce gradually. 31:24 31 minutes, 24 seconds That ma'am you have been saying for the last two years but you know we need a timeline. Oh okay by 6 month this much will reduce or after one year so much will reduce. We need a guidance. 31:36 31 minutes, 36 seconds Yeah. So the guidance wise I'm saying that you know post this March results as we had said we will approach the lenders and maybe in next quarter we can get an 31:43 31 minutes, 43 seconds update as to how much we can be reducing this year. 31:47 31 minutes, 47 seconds Has the promoter any percentage in mind okay I'm going to reduce by this much but so see the target is that you know 31:55 31 minutes, 55 seconds we reduce it by around 15 20%. But let's see and we'll come back to you. 32:02 32 minutes, 2 seconds Okay. And my next question was uh regarding that uh a real estate project Patil's modo in Hyderabad. So I believe 32:10 32 minutes, 10 seconds the OT was pending and 372 flats were made. I think there were three towers, two were residential and one was a hotel. So can we have an update? How 32:19 32 minutes, 19 seconds much when will we get the OC? Number one. Number two, how many flats have been sold? And what about the third tower which was supposed to be a hotel? 32:27 32 minutes, 27 seconds Can we an update? 32:30 32 minutes, 30 seconds So I think we have applied for the OCE there some uh something was pending some uh litigation or something was there. So 32:38 32 minutes, 38 seconds we have to we are expecting that to get sort out this financial year and we should get that OC this year 32:47 32 minutes, 47 seconds and uh sorry to interrupt Rajiv sir may we request you return to the queue for followup questions please. 32:55 32 minutes, 55 seconds Thank you. 32:57 32 minutes, 57 seconds The next question comes from the line of Demal Tay an individual investor. Please go ahead. 33:05 33 minutes, 5 seconds Hello, thank you for the opportunity. 33:08 33 minutes, 8 seconds My first question is if you look at the interest cost, it's 79 cr this uh 33:14 33 minutes, 14 seconds quarter. Uh so it's and the rate of interest seems to be very high at 18%. 33:21 33 minutes, 21 seconds Can you help me understand what it is due to? Maybe it's due to the earlier restructuring. So can you give some 33:28 33 minutes, 28 seconds color on what the terms are and when can we expect this to go down? 33:36 33 minutes, 36 seconds Their interest rates are around 11 11 and a half%. So uh see the uh interest cost comes basically the finance cost 33:44 33 minutes, 44 seconds considers of three components. Okay. One is the interest on the borrow. The second is the interest on the client 33:51 33 minutes, 51 seconds advances. So there we have around 600 odd crores of client advances. So that also carries interest of similar nature. 33:58 33 minutes, 58 seconds Plus we have non-fund based limits which is uh bank guarantees, LC's etc. which we have to give to the client for 34:05 34 minutes, 5 seconds advances and for procurement of material. So that also carries the cost. 34:09 34 minutes, 9 seconds So on an annual basis uh I can give you that broad break up like around 70 odd crores is for the non-fund based limits. 34:19 34 minutes, 19 seconds uh then around uh balance what is remaining if you add up the debt and the client advances the average interest rates will come between 11 to 12. 34:28 34 minutes, 28 seconds Okay. Yeah. Thanks for explaining this. 34:31 34 minutes, 31 seconds So my second question is we have sold our ACP tollway state for 55 crores and 34:38 34 minutes, 38 seconds that announcement mentioned that it contributed 18 crores of profit annual. 34:45 34 minutes, 45 seconds So it seems uh like only three times the profit. So can you please explain what 34:54 34 minutes, 54 seconds uh what is how this valuation was there and maybe that profit uh yeah so I'll 35:03 35 minutes, 3 seconds tell you see the net worth if you see of the company okay is around 38 cr only that is as of March 25 because March 26 35:11 35 minutes, 11 seconds because we already got an offer so we have not consolidated it and it is held for sale so 38 crores was the net worth and the carrying value of the investment 35:20 35 minutes, 20 seconds as of March 26 in our books is now 26 crores only. So 18 crores was the profit in March 25 35:27 35 minutes, 27 seconds and that company although profit what is there there is a still a borrowing remaining of around 600 crores and 200 35:36 35 minutes, 36 seconds crores is approximately the uh major maintenance which has to be incurred. So this next few years collection will go 35:43 35 minutes, 43 seconds into repayment and the incurring of the major maintenance. So once that is completed then only some equity return can happen. So we can see only equity return of after only four five years. 35:55 35 minutes, 55 seconds So it is better that you know we sell the investment and we get the money and reduce our debt. 36:02 36 minutes, 2 seconds Okay. Uh yeah uh thanks for explaining that also. Um one more question our subansery project if we complete this 36:11 36 minutes, 11 seconds year will we get substantial cash flow from that and will that help our debt reduction further? 36:20 36 minutes, 20 seconds For as we are the contractor and we are getting paid monthly as and when we do the work. So it is not a substantial for 36:29 36 minutes, 29 seconds us it is a contract. NHTC is developing this project and they are going to get a larger chunk of revenue after uh commissioning. 36:38 36 minutes, 38 seconds Okay thanks that's all from my side. Thank you for that. 36:44 36 minutes, 44 seconds Thank you participants. If you wish to register for a question, please press star and one now. 36:57 36 minutes, 57 seconds The next follow-up question comes from the line of Rajie, an individual investor. Please go ahead. 37:03 37 minutes, 3 seconds Yes, sorry the moderator cut me in between. So that my question, my answer was incomplete that Patel's modo. How many flats have been sold in the two towers and what about the third tower? 37:14 37 minutes, 14 seconds You're going to make a hotel on that or what? Can you please explain in detail please? 37:20 37 minutes, 20 seconds See the number of flats sold details I don't have right now but that there were two residential towers in there and there was one service apartments. 37:31 37 minutes, 31 seconds Okay. So what is uh regarding the service apartments? It's lying vacant or what's happening on that tower? 37:39 37 minutes, 39 seconds Is it complete? What's happening? 37:42 37 minutes, 42 seconds Yeah. Yeah. It is completed from our side everything. Now the service department operator has to start it. 37:49 37 minutes, 49 seconds Okay. So what kind of revenue can it generate and from when does it happen? 37:57 37 minutes, 57 seconds See we don't have any idea about when the revenue starts because that is the service operator will do 38:05 38 minutes, 5 seconds and you don't know how many flats have been sold in the two towers. I think there were 372 flats. Right now I don't have those details. 38:14 38 minutes, 14 seconds Okay. And then my next question was regarding the arbitration award. So sir, I'm saying we are getting only 50 about 38:21 38 minutes, 21 seconds 50 crores per year and 700 crores are in in our favor. So can we expect we'll get 38:28 38 minutes, 28 seconds only 50 crores every year for the next four five 10 years? When can we get when by when this major chunk of the 700 crores come to us? 38:38 38 minutes, 38 seconds See uh out of the 700 crores more than 400 crores is in high court right now and balance is in district court. So it 38:46 38 minutes, 46 seconds can take some time high court generally takes one or two years and then supreme court maybe one year. So but what happens is something or the other out of 38:55 38 minutes, 55 seconds that either against NITIA bank guarantee or code deposit of bank guarantee we try to withdraw that cash flow and then 39:02 39 minutes, 2 seconds that's how we get so overall expected timeline of this will be around 5 to 6 years overall but it's not that 39:09 39 minutes, 9 seconds everything comes after that got it and what about the balance 2300 crores any update on that 39:18 39 minutes, 18 seconds the balance 2300 crores so there are multiple arbitrations going on. So what we expect is we get we'll get some 39:26 39 minutes, 26 seconds arbitration awards and then uh post arbitration award if we are able to draw the money against bank guarantees and it 39:34 39 minutes, 34 seconds comes earlier if it has to be realized from course then post overall it may take five to six to seven years 39:42 39 minutes, 42 seconds okay my next question was uh regarding the promoter stage you know the promoter stage has fallen from 39% in June 23 to 39:50 39 minutes, 50 seconds now 31.4 48%. And the promoter has not participated in the rights issue also. 39:58 39 minutes, 58 seconds So I mean if the promoter didn't want to participate in the rights issue, you know why then why do a rights issue? 40:06 40 minutes, 6 seconds Why didn't you sell the remaining land back to raise funds? Please clarify. 40:13 40 minutes, 13 seconds See there has to be a timing requirement, right? So rights issue was done because we needed money for the operations and the future projects which 40:21 40 minutes, 21 seconds are coming immediately. Land bank sale I mean we cannot timeline timing wise we cannot ensure that it happens 40:29 40 minutes, 29 seconds immediately. It takes a little by bit of time. And we have been doing that every year like this year also we sold some land parcels current again this year we 40:36 40 minutes, 36 seconds are expecting some land parcels to be sold but uh we can't expect that okay this quarter we need the money and it 40:43 40 minutes, 43 seconds will come this quarter from land sale but to me it seemed very absurd that the promoter is not participating 40:52 40 minutes, 52 seconds participating in the rights issue and the public you want the public to subscribe to your rights. 41:00 41 minutes The promoters have subscribed around 20 crores partly and rest was taken by public. 41:06 41 minutes, 6 seconds But they should have subscribed to the full full quot. That's my question. 41:12 41 minutes, 12 seconds Oh, but they had already mentioned in the document that they will subscribe partly only. 41:18 41 minutes, 18 seconds Okay. And my last question this uh whatever the balance land sale is there your by when this whole the entire land bank be sold in the next 3 four years. 41:31 41 minutes, 31 seconds Yeah for four five years it should happen. So we have targeted few land parcels to be sold first that will happen in the next couple of years and 41:39 41 minutes, 39 seconds rest will take some time. So around four five years. Thank you. 41:47 41 minutes, 47 seconds As there are no further questions from the participants, I now hand the conference over to the management for closing comments. 41:55 41 minutes, 55 seconds Thank you all for joining this call. If any questions you have, you can write to us and we can revert to you. Either you can write to us or you can write to Val. 42:05 42 minutes, 5 seconds Thank you. Thank you. 42:09 42 minutes, 9 seconds Ladies and gentlemen, on behalf of Patil Engineering Limited, that concludes this conference. Thank you everyone for joining us and you will now disconnect your line.