SPML Infra Ltd — Q3 FY26

Spml Infra Ltd Q3 FY2025-26 Earnings Conference Call https://www.youtube.com/watch?v=21IHFI48Gdc Published: 2 months ago

0:01 1 second Ladies and gentlemen, good day and welcome to SPML Infra Limited Q3 FI26 0:08 8 seconds earnings conference call hosted by Go India Advisor LLP. As a reminder, all participant lines will be in the 0:16 16 seconds listenon mode and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during this assistance during this conference call, 0:24 24 seconds conference call, please signal an please signal an operator by pressing operator by pressing star then zero on star then zero on your touchstone phone. 0:29 29 seconds your touchstone phone. Please note that Please note that this conference is this conference is being recorded. I now being recorded. I now hand the hand the conference over to Miss Selena conference over to Miss Selena Shake Shake from Go India Advisor LLP. Thank 0:36 36 seconds from Go India Advisor LLP. Thank you and you and over to you ma'am. 0:40 40 seconds over to you ma'am. 0:41 41 seconds Hello everyone. Should you need Hello everyone. A very good afternoon and welcome to SPML Infra limited quarter 3 and 9month FI26 earnings conference call hosted by Goindia 0:50 50 seconds advisers from the senior management we have with us on the call today Mr. Manoj Diga executive director and chief financial officer Mr. Samir Patel chief 0:59 59 seconds of technology and operations of best segment Mr. Arunagal vice president of finance and accounts and Mr. couple Jooshi investor relations officer before 1:08 1 minute, 8 seconds we begin the earnings call we must remind you that the discussion in today's call may include sorry and forward-looking statements and must be therefore moved in conjunction with the 1:16 1 minute, 16 seconds risk that the company faces I would now like to hand over the call to Mr. Arvin Gal for his opening remarks. Thank you and over to you sir. 1:26 1 minute, 26 seconds Good afternoon ladies and gentlemen. I welcome you all to the quarter 3 and 9 months of FY26 conference call for SPML 1:34 1 minute, 34 seconds Infra Limited to discuss the operational and financial performance of the company. Our results and investor presentation have already been posted on 1:43 1 minute, 43 seconds the stock exchange website and I hope everyone had a chance to go through them. Over the last 45 years, SPML Infra 1:51 1 minute, 51 seconds has built strong capabilities by delivering 700 plus milestone infrastructure projects across various states and earned valuable 1:59 1 minute, 59 seconds qualifications across the water and power businesses. Rebuilding on strength and reshaping for future, we are 2:06 2 minutes, 6 seconds transitioning to SPML 2.0 focused on discipline growth, selective bidding and higher margin opportunities. 2:14 2 minutes, 14 seconds The current fiscal have been pivotal with strong order inflows and steady execution across water power and the 2:22 2 minutes, 22 seconds emerging base segment. We remain focused on profitable and sustainable growth in these long-term growth oriented sectors. 2:29 2 minutes, 29 seconds Now moving on to some updates on the infrastructure sector as India advances towards its VIX Bharat 2:37 2 minutes, 37 seconds mission. infrastructure continues to act as a key engine for economic growth, employment generation and long-term 2:43 2 minutes, 43 seconds financial stability. The union budget of FY26 reinforces infrastructure gate growth with a capital outlay of 12.2 2 2:52 2 minutes, 52 seconds lakh crores with substantial allocation of 85,222 crores for urban development supporting 2:59 2 minutes, 59 seconds India's Vixbas vision continued emphasis on water infrastructure with 67,670 3:06 3 minutes, 6 seconds cr for geljan mission 8,000 crores for amlit 2.0 to 5,226 crores for irrigation 3:14 3 minutes, 14 seconds and river in interlinking and 3,100 crores for Nami Gang is structurally positive. 3:22 3 minutes, 22 seconds The water supply projects under the overall location of Rs 17 lakh cran mission Amrit 2.0 and Nami Gang river 3:31 3 minutes, 31 seconds linking programs and others will be implemented on a long-term basis. 3:36 3 minutes, 36 seconds These priorities align strongly with SPML Infra's core strength in water sanitation and reuse projects. We are 3:45 3 minutes, 45 seconds well positioned to leverage on the opportunities to drive quality order inflows through selective bidding while maintaining margins and returns. 3:54 3 minutes, 54 seconds India's energy transition targets of 500 gawatt of non- fossil capacity by 2030 4:01 4 minutes, 1 second with installed capacity of already at around 263 gawatt. 4:07 4 minutes, 7 seconds The battery energy storage capacity is projected at 236 gawatt by FY32 translating into a USD 57 billion market by 2032. 4:18 4 minutes, 18 seconds And the union budget FYI26 reinforces this with 1 lakh 9,000 crores for energy infrastructure around 1,000 cr of 4:26 4 minutes, 26 seconds viability gap funding for base incentive for lithium ion manufacturing and financing reforms while via PFC and RC. 4:36 4 minutes, 36 seconds SPML Infra had strategically entered into base with end to end EPC capabilities and a 2.5 gawatt phase 1 4:43 4 minutes, 43 seconds manufacturing facility at super MIDC Pune which is expected to come up in Q1 FI27 is scalable beyond 10 gawatt 4:52 4 minutes, 52 seconds supported by a technology partner with energy vault USA. We are actively and aggressively bidding for base 5:00 5 minutes opportunities supported by strong policy guidelines improving project economics and catering to greed scale demand. The 5:08 5 minutes, 8 seconds opportunities are over and above current opportunities of appro 50,000 cr in power substations which is also a core strength of the company. 5:16 5 minutes, 16 seconds Uh coming to our operational performance, we are pleased to inform that for most of our recently awarded projects where design and drawing 5:25 5 minutes, 25 seconds approval typically take 6 to 8 month 12 months, the required approvals have now been secured. Project execution has 5:33 5 minutes, 33 seconds commenced providing us with clear visibility on revenue recognition and profitability from these projects going forward. During the 9 month of FI26, 5:42 5 minutes, 42 seconds SPML Infra witnessed strong order momentum securing fresh order inflows of 4324 crores across water projects in 5:50 5 minutes, 50 seconds Jark and Madhya Pradesh and Rajasthan besides Tamil Nadu. This figure retrains the total project value including order awarded through joint ventures. 6:01 6 minutes, 1 second Our current order book stands at 4358 including the taxes which reflects SPML's proportionate share in JB projects. The order book comprises 6:10 6 minutes, 10 seconds approximately 1,540 crores of legacy orders and around 2,800 crores of newly secured projects providing healthy 6:19 6 minutes, 19 seconds execution visibility for the coming quarters. 6:22 6 minutes, 22 seconds We have also with tenders worth approximately 8,000 crores in Q3 Q4 of the current year across the water base and power segments which are active in 6:32 6 minutes, 32 seconds nature. Our overall exposure in gel given mission is substantial and for the JGM projects billing and fund receipt 6:40 6 minutes, 40 seconds are received from the government is strictly in line with the execution progress ensuring working capital discipline. We follow a highly selective 6:48 6 minutes, 48 seconds billing approach aligned with our pre-qualification strengths focusing only on fund fully funded projects DPR approved and higher margin projects with 6:57 6 minutes, 57 seconds robust contractual structures. We are well positioned to achieve our targeted business volume for the current fiscal 7:05 7 minutes, 5 seconds with potential upside next year while maintaining our focus on assured funding, timely execution and margin led 7:12 7 minutes, 12 seconds sustainable growth. We continue to explore opportunities across water and power EPC tenders currently under 7:19 7 minutes, 19 seconds various stage of building across Maharashtra, Madhya, Jarkan, Bihar, Kerala and other states. The total 7:26 7 minutes, 26 seconds estimated opportunity size across these markets is approxim approximately 5.7 lakh crores. Given our strong 7:34 7 minutes, 34 seconds pre-qualification status, execution track record and regional presence, we expect a meaningful conversion of these 7:41 7 minutes, 41 seconds opportunities into order inflow during FI27. 7:46 7 minutes, 46 seconds In parallel, we are strengthening our presence in the battery energy storage system segment. We are actively 7:54 7 minutes, 54 seconds participating in various trenders floated by NTPC and other agencies with a clear focus on maintaining our 8:01 8 minutes, 1 second targeted margin profile. Over the next 6 to 12 months, we see a visible pipeline of approximate 9,000 crores in base 8:08 8 minutes, 8 seconds orders and we remain optimistic about securing a healthy share of these opportunities. 8:15 8 minutes, 15 seconds Coming to our base plant update, the development of the manufacturing facility is progressing in line with our planned timelines. The construction of 8:23 8 minutes, 23 seconds the factory is progressing as planned with the structural framework currently being erected at the project site. The machenaries are expected to reach us 8:31 8 minutes, 31 seconds during February and March after which commissioning will commence in a phased manner. We also anticipate making the plant operational from Q1 8:40 8 minutes, 40 seconds and coming now to our financial performance. 8:45 8 minutes, 45 seconds As of 9 months of FI26, SPML Infra has meaningfully strengthened its financial position with steady progress on dealing 8:53 8 minutes, 53 seconds including around 317 crores of debt repaid over the last two years which includes rupes 47 crores of prepayment 9:00 9 minutes on the overall liability. The residual around 383 crores payable to NRCL is spread over six years and is expected to 9:09 9 minutes, 9 seconds be fully settled through existing arbitration awards in hand of rupes 621 crores which is inclusive of accumulated interest up to January 26. 9:20 9 minutes, 20 seconds While additional arbitration claim of 4,417 crores provide visibility of around 1,500 crores in flows over next 7 9:28 9 minutes, 28 seconds to 8 years. Also during the year company has received arbitration awards sum of rups 30 crores amounting to rups 22 9:37 9 minutes, 37 seconds crores from the CWSSB and rupees 8 crores from DIY jellboard with this 312 crores worth of awards has already been 9:45 9 minutes, 45 seconds realized over the last 3 years. The company expect a sizable cash flow after the payment of agreed NRCL debt which 9:53 9 minutes, 53 seconds can be utilized for the future growth of the company. 9:56 9 minutes, 56 seconds During the quarter, our credit profile was reaffirmed as tableable by IRA and further ratings are under reviewing 10:05 10 minutes, 5 seconds the ongoing strengthening of our balance sheet and cash flow visibility. Our sanctioned bank facility have been enhanced from rupes 205 crores to 505 10:14 10 minutes, 14 seconds crores by leading public sector bank. We have received approval for a shorty bond of around 180 crores from the leading 10:22 10 minutes, 22 seconds insurance companies further enhancing our bidding capabilities. This expanded limit provides greater flexibility to bid for larger projects and manage 10:31 10 minutes, 31 seconds working capital more efficiently for 9 months of 26 standalone revenues 10:39 10 minutes, 39 seconds to that rupees 595 594 crores with aa of rupes 62 crores and 10:46 10 minutes, 46 seconds pat of rupees 48 crores translating into margins of 10.4% and 8% respectively. 10:53 10 minutes, 53 seconds Q3 FY26 revenue were to 131 crores up 21% year-on-year basis with AITA stood 11:01 11 minutes, 1 second at rupees 26.3 crores translating into margin of 11.4 crores and PAT stood at 20.5 crores with margin of 8.9%. 11:09 11 minutes, 9 seconds AITA is up by 86% and PAT is up by 97% year-on-year basis. The completion of legacy lower margin projects and 11:18 11 minutes, 18 seconds increasing contribution from higher margin new orders has already begun to lift profitability positioning the company on a stronger and more 11:26 11 minutes, 26 seconds sustainable earnings trajectory going forward. During the quarter, the interest cost has increased mainly on account of one-time interest cost on 11:34 11 minutes, 34 seconds income tax for the earlier years post assessment and BG and LC charges and the interest on the mobilization advances on 11:41 11 minutes, 41 seconds the new project. In the recent budget announcement, the honorable finance minister has proposed to carry forward the math grade for future tax liability only under the new tax regime. 11:51 11 minutes, 51 seconds Accordingly, the company has planned to shift to new tax regime from the next financial year where the existing carry forward losses can be adjusted with the 11:58 11 minutes, 58 seconds future profit without need to make any provision for MAC. This will help the company to save the tax expenses of next few years and subsequently adjust the 12:06 12 minutes, 6 seconds MAC rate considering the available allowable expenses under MAC. No MAC provision has been made in Q3 FI26 and 12:13 12 minutes, 13 seconds need provide in Q4 FY26. Also, the company is having a strong current ratio of 1.81 date one times as of Q3 F26 12:22 12 minutes, 22 seconds which shows the sufficient liquidity into the company. The current ratio is slightly impacted in the current quarter because of the various bills raised in the end of the quarter and the 12:31 12 minutes, 31 seconds realization of which will be received in the Q4. Further the company is expecting more than rupees 100 crores latest by 20 12:38 12 minutes, 38 seconds 22nd April 26 from conversion of warrants which will improve the liquidity further with a significant portion of our 12:46 12 minutes, 46 seconds projects now entering the billing phase and education momentum accelerating we are confident of delivering a strong Q4 performance performance remains aligned 12:55 12 minutes, 55 seconds with the guidance outlined earlier has translated into tangible results in 9 month FI26 and we remain well positioned 13:02 13 minutes, 2 seconds to meet our fully growth for FI26 and around 25 to 30% on the revenue and approximately 40 to 50% on the PAT. With 13:11 13 minutes, 11 seconds the conversion of the awards from the various tenders currently floated by different states in water, power and base segment, we shall provide the 13:19 13 minutes, 19 seconds guidance for FY27 in our yearly con along with the ENA results. That is all from us. We will now open the floor for questions. Thank you. 13:30 13 minutes, 30 seconds Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may please 13:37 13 minutes, 37 seconds press star and one on their touchstone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are 13:46 13 minutes, 46 seconds requested to use handsets while asking a question. Ladies and gentlemen, we'll wait for a moment while the question assembles. 14:10 14 minutes, 10 seconds The first question is from the line of Hardik Gandhi from HPMG shares and securities. Please go ahead. 14:18 14 minutes, 18 seconds Hello sir, congratulations on the set of good numbers. Just wanted to know on three questions. First is given that we 14:25 14 minutes, 25 seconds did not pay tax this quarter and you mentioned there is a tax adjustment which is about to happen for the earlier losses under Matt. So can you quantify 14:32 14 minutes, 32 seconds the amount of outstanding losses which we can avail in the upcoming quarters against the profit. 14:39 14 minutes, 39 seconds We have roughly around 200 cr of loss and then the further assessment is going on. So next few years uh we don't have to pay tax. 14:49 14 minutes, 49 seconds Okay. So, so for few years or uh for few quarters just few few years because we have the 14:56 14 minutes, 56 seconds accumulated loss which will be which will be sufficient for this year, next year and one more year definitely 15:05 15 minutes, 5 seconds right. Uh the second question was on the line of the BESS front where we can see a lot of players are entering they're putting up their manufacturing right. So 15:14 15 minutes, 14 seconds just wanted to understand from your from your end whether first of all uh are we on track for Q1 are we expecting numbers 15:22 15 minutes, 22 seconds to start coming in our uh top line as well as bottom line in Q1 or are we expecting meaningful contribution later 15:30 15 minutes, 30 seconds on and second is we did mention earlier that we are going to set up a container manufacturing facility also which would 15:37 15 minutes, 37 seconds help backward integrate. So just just your thoughts on these two. 15:42 15 minutes, 42 seconds Uh two thing as we Arun has explained our BSS plant is on track. Uh we are expecting the commercial production in 15:51 15 minutes, 51 seconds Q1. Uh basically we construction work has almost completed and uh is in the advanced stage of progress. Machinery 16:00 16 minutes equipment the order we had already given and they are expected to come in February and March. So we are BSS plant 16:07 16 minutes, 7 seconds is on track. uh on the tender we are already participating it is irrespective whether the BSS plant start or not we 16:16 16 minutes, 16 seconds are we are participating into various tender roughly around 4,000 cr worth of tender we are participating there is a 16:23 16 minutes, 23 seconds visibility of roughly around 8 to 9,000 cr going forward into the BS standard and we are participating into that and 16:32 16 minutes, 32 seconds based on the based on the our selected criteria and margin category we are hopeful that we will get in the Q1 some 16:41 16 minutes, 41 seconds some order Q1 next year we will get a substantial order in from the base operation also. 16:47 16 minutes, 47 seconds Yeah. And for the container manufacturing facilities where container we are still evaluating uh we are first we have to internally 16:56 16 minutes, 56 seconds prepare the DPR and uh yes we have the plan to do that but till date we have we are evaluating our internal level 17:03 17 minutes, 3 seconds internal committee and at the board level. Once they approve we will declare and we will inform to you in our subsequent call. 17:12 17 minutes, 12 seconds Understood. And just last question on the bottom line where next year given that our legacy projects will be in uh 17:20 17 minutes, 20 seconds the last phase of execution our new projects will be kicking in as well as the best will be kicking in right so all these will be giving a margin boost 17:30 17 minutes, 30 seconds right so I'm just assuming our bottom line to grow uh by what percentage you mentioned a 50% uh bottom line kagger 17:38 17 minutes, 38 seconds but I think uh I think so it should be more than that given the best as well as the new projects are 17:45 17 minutes, 45 seconds more value creative. Now this guideline what we have given guidance that is for this year uh and the Q4 the overall year 17:55 17 minutes, 55 seconds growth we expected roughly around 25 to 30% growth into the top line and rough of around 40 to 50% growth into the 18:03 18 minutes, 3 seconds bottom line that is for this year as as we have informed in our opening remark that the yearly guideline we will give 18:11 18 minutes, 11 seconds into the our yearly phone call because by that time we will have the clarity on the various standards which are which 18:20 18 minutes, 20 seconds are which are at the moment floated and uh we are we have participated into that 18:27 18 minutes, 27 seconds based on the visibility of that we will give the annual plan of the next year in our in our yearly con call plus we are 18:37 18 minutes, 37 seconds in the process of preparing our AOP once that will be prepared it will be better for us to give you the guidance for the next year 18:45 18 minutes, 45 seconds understood thank that's your mind. Thank you so much. All the best. 18:50 18 minutes, 50 seconds Thank you sir. The next question is from the line of Maitri Sha from Sapphire Capital. Please go ahead. 18:58 18 minutes, 58 seconds Yeah. Hello. Good morning. Am I audible? Good morning. Good morning math. 19:04 19 minutes, 4 seconds Yeah. Hello. Uh a few questions. Firstly on the current order book that we have of 4,300 crores we do we have any power 19:12 19 minutes, 12 seconds projects right now in the order book or this is all water related projects. 19:18 19 minutes, 18 seconds We have legacy power projects. The new new we have not not taken any power project. We have bidded uh there is a in 19:26 19 minutes, 26 seconds power we are very actively into the substation and uh uh from the last year service 19:33 19 minutes, 33 seconds station volume was very low but uh from the from the last few months various tenders of the service station has 19:40 19 minutes, 40 seconds started coming and we have participated into that. So at the moment our legacy project has roughly around 200 to 3 of 19:48 19 minutes, 48 seconds 300 cr of the power project. Uh but the new order nothing is in the power. 19:55 19 minutes, 55 seconds Okay. Um secondly, what how much is the receivables we are left to receive from the JJM site and also if you could give 20:03 20 minutes, 3 seconds the JM portion of the order book if that's possible? Can you pardon me on this? 20:09 20 minutes, 9 seconds JGM order. JJM order JJM the old order as as we have told in the opening 20:16 20 minutes, 16 seconds remarks old order we have roughly around 200 to 300 cr in the legacy that left into the JM the new JDM orders all as 20:26 20 minutes, 26 seconds per the new scheme of the government where we have we have received two orders from the JJM one in the Maratura 20:33 20 minutes, 33 seconds and another is into the into the K tree this is recently and which are executing And what what is the value of these new orders? 20:43 20 minutes, 43 seconds One is 1438. Second is 300 380 something. 20:48 20 minutes, 48 seconds 380. Okay. And the receivables outstanding of JM currently are 20:55 20 minutes, 55 seconds JM older we don't have in the K3 we have recently towards the end we have issued certain bills which we are expecting the payment in this month. 21:05 21 minutes, 5 seconds Okay. Uh next uh the next question we had was on the closing order book for 26. So are we expecting any order info 21:14 21 minutes, 14 seconds in quarter 4 from the power side and what sort of order book value do you expect by the end of FI26 if that number 21:21 21 minutes, 21 seconds is possible? Any targets you have till date as I told you the entire new order book we have received 4,323 21:31 21 minutes, 31 seconds which includes the JV. If you take our share outstanding is roughly around 2,817. 21:39 21 minutes, 39 seconds We have legacy order of roughly around 1540 cr. So the total order and as on 21:45 21 minutes, 45 seconds 31st December is roughly around 4,358 cr we have bided for roughly around 21:53 21 minutes, 53 seconds 8,000 cr of orders. roughly around 5,000 five lakh cr of order visibility is there in the various states there 22:01 22 minutes, 1 second whenever that will come we will keep on bidding so we are in the target you have for the March 26 22:08 22 minutes, 8 seconds closing order book figure for uh including uh the water and the power March 26 order book will be as it is 22:16 22 minutes, 16 seconds because now whatever tender is coming if we leave it will not convert by March 22:24 22 minutes, 24 seconds so March the 26 this will be the order book four five years this will be the but we'll be executing some of the order in this quarter right 22:32 22 minutes, 32 seconds so we're what sort of orders are we expecting in the quarter 4 in flow in if you see in the in the bidding 22:40 22 minutes, 40 seconds process it's take from bidding to conversion and the signing of agreement or LOI it takes roughly around 3 to four 22:49 22 minutes, 49 seconds month although we have bided into 8,000 cr of But we are not expecting that to be 22:56 22 minutes, 56 seconds converted into by March. It may be in the first quarter we will get some conversion bidded orders. 23:04 23 minutes, 4 seconds What sort of win ratio we have on these orders that we've bidded? Pardon? 23:11 23 minutes, 11 seconds Uh any win ratio we have for the water orders or the power orders that we've bidded? There is no win ratio as such 23:19 23 minutes, 19 seconds because as as I told in our our remarks that we are very very selective on certain criteria of our order selection 23:28 23 minutes, 28 seconds we we don't bid where the funding is not there we don't bid where the margin is less than 10%. So if it is if if there 23:36 23 minutes, 36 seconds is a margin our bidding is always more than 10%. So we can't can't that way 23:43 23 minutes, 43 seconds there is no thumb rule that how much did and how how much getting converted but definitely in we are we are the leading 23:52 23 minutes, 52 seconds player and we have the PQ and we have the ability we are expecting a sizable order in the next year from the order 23:59 23 minutes, 59 seconds opportunity what we have in the water power and de that is great uh secondly on the 24:07 24 minutes, 7 seconds timeline so what sort of timelines you have on the auto orders and the timeline you have for the substation orders or the BSS orders that we're going to be 24:14 24 minutes, 14 seconds bidding from now now on timeline on the execution uh in the water project uh generally it 24:24 24 minutes, 24 seconds is coming from uh 2 and 1/2 years to 4 and 1/2 years because it's a design drawing project. So basically 3 to 6 to 24:33 24 minutes, 33 seconds 12 months it is required to get the approval of the design drawing and then roughly around 2 and 1/2 years to three 24:40 24 minutes, 40 seconds and a half years is for the completing of the project. Power project is normally 24 months. 24:48 24 minutes, 48 seconds That is the period by which your transformer 24 months to 28 months that is the power because the substation and 24:55 24 minutes, 55 seconds transformer is a long leading period lead period and DESS is between 1 year to two years one year to two years. Amir if you add here. 25:07 25 minutes, 7 seconds Okay. 25:08 25 minutes, 8 seconds And on the bidding side what projects are we bidding for? Is this EPCN supply or are we also going to take part in the 25:14 25 minutes, 14 seconds O andM part of the project and also are we going to do the B projects as well? 25:20 25 minutes, 20 seconds any color on what sort of BDSS opportunity we are bidding for? 25:25 25 minutes, 25 seconds DSS at the moment we are bidding for the EPC only but we are also exploring at 25:32 25 minutes, 32 seconds the moment only EPC EPC and the supply uh from managing facility correct right 25:39 25 minutes, 39 seconds then EPC is it includes the supply it includes the design it includes the 25:47 25 minutes, 47 seconds fabrication construction everything okay so the entire 2.5 gawatt hour are we going to use that captively or are we 25:55 25 minutes, 55 seconds expecting to sell that to any third party EPC player as well. 26:01 26 minutes, 1 second That's that's the we have the battery pack facility. The same battery pack will be utilized for our EPC business 26:08 26 minutes, 8 seconds and we will also do the OEM for any EPC player who are in the BESS. So their 26:17 26 minutes, 17 seconds battery pack requirement also we will satis we will meet out from our battery pack. it will be both. 26:25 26 minutes, 25 seconds Okay, that is great. Um, and also so you gave some targets for FI26 25 to 30% 26:32 26 minutes, 32 seconds growth and so quarterf is looking quite heavy with the execution. Are we confident on the 350 400 crores of execution in the fourth quarter for 26? 26:44 26 minutes, 44 seconds Fourth quarter will be better. As I told you uh in the design drawing the approval is taking slightly longer time 26:51 26 minutes, 51 seconds because that decide each and every aspect of the pipe size, pipe lane area, 26:59 26 minutes, 59 seconds forest clearance all these things are there at the design drawing time and subsequent to that it's a fast track and 27:07 27 minutes, 7 seconds where we have a a strong team of execution and a strong relationship with the suppliers. has and we do maximize 27:16 27 minutes, 16 seconds into the escro accounts mechanism we have the sufficient bank limit so I'm not finding any problem in execution of 27:25 27 minutes, 25 seconds the project and since as as Aron has told we have got all the clearance from our three plant all the major design and 27:34 27 minutes, 34 seconds drawing approval so we are expecting a good healthy Q4 this year that's okay and the 2.5 gawatt capacity 27:44 27 minutes, 44 seconds That's the phase one. What sort of capacity are we adding in the phase two? Is it similar or a bit higher? 27:51 27 minutes, 51 seconds We have the plan to enhance it to five and finally to 10. 27:56 27 minutes, 56 seconds Okay. Fine. And the capacity would do you expect the revenue from this uh battery pack? 28:05 28 minutes, 5 seconds We he will inform you into the yearly call because by that time we will have our ready. But uh Q next year will be 28:14 28 minutes, 14 seconds slightly substantially better compared to this financial year because one uh 28:20 28 minutes, 20 seconds all the project revenue which we got the design and drawing approval will be executed in full swing into the next 28:28 28 minutes, 28 seconds year on our approved project. Second there is a visibility of five lakh crers which are coming into the Q3 Q4 and Q1. 28:39 28 minutes, 39 seconds We are expecting some revenue from there, some order conversion from there which may give us the result into the Q4 28:46 28 minutes, 46 seconds into the next year. DESS we are expecting a sizable order. We are expecting the power sector service good 28:55 28 minutes, 55 seconds order. So we are expecting the next year will be much better both on the top line and the bottom line. But however the 29:03 29 minutes, 3 seconds guidance we will provide you and the margins on the BS and substation side what sort of differential you have 29:12 29 minutes, 12 seconds with the water. So are they in the range of like 12 to 13% or in the same range of 10% margin 29:19 29 minutes, 19 seconds as I as I told you we have a clear discipline that less than 10% we will not take any business certification or water. 29:30 29 minutes, 30 seconds Okay. Yeah that is it from my side. Thank you so much. Thank you ma'am. 29:37 29 minutes, 37 seconds Ladies and gentlemen, to ask a question, please press star and one. Now participants who wish to ask questions 29:45 29 minutes, 45 seconds may please press star and one at this time. 29:50 29 minutes, 50 seconds The next question is from the line of Hmon Sony from uh Hmon Sony and individual investor. Please go ahead. 29:58 29 minutes, 58 seconds Thank you for providing me with the opport opportunity. Just wanted to ask one thing uh the operating IITA for FY25 30:08 30 minutes, 8 seconds is I guess 43 odd crores. So even if I do a math and uh uh take your guidance 30:15 30 minutes, 15 seconds of a 40 to 50% uh I mean profitability uh the operating should be close to 60 30:25 30 minutes, 25 seconds odd crores for FY26 right and uh we have already done an operating of around 43 30:32 30 minutes, 32 seconds crores uh I guess in uh 9 months of FI 26. So is it I mean and the guidance and 30:41 30 minutes, 41 seconds the numbers don't match. So is it fair to assume that are we being little conservative in giving the guidance for 526 in terms of profitability? 30:53 30 minutes, 53 seconds If you see the yearly number of our last year IITA operating IITA was 62.88 K. 31:02 31 minutes, 2 seconds At this in the 9 month we have made the IIDA of 61.71 cr. So we are able to achieve the entire 31:11 31 minutes, 11 seconds last year IIDA into the 9 month approximately and we have the Q4 also which we feel 31:19 31 minutes, 19 seconds will be slightly better because uh because of our approvals which we have obtained this quarter we had the 26 cr. 31:30 31 minutes, 30 seconds So the next quarter we should have slightly better. So that's that's the guidance we have given you. 31:39 31 minutes, 39 seconds Uh so I was actually not factoring it the other income. I was uh I mean talking about the operating 31:49 31 minutes, 49 seconds this other what operating which you are saying the other income minus. 31:54 31 minutes, 54 seconds Yes. Yes. Yes. I have the numbers in front of me. I guess they are close to uh 43 crores for 9 months of employment I guess on a console level. 32:06 32 minutes, 6 seconds No, if you if you do that then even if you minus the other income which is basically the interest income and 32:13 32 minutes, 13 seconds various that income which is related to the operation of the company. So if you minus here and if you minus into the 32:21 32 minutes, 21 seconds last year also so it will be reduced by 16 cr from here and it will be reduced by 11 cr from from the last year. So it 32:30 32 minutes, 30 seconds will be roughly around 50 cr and here it is around 44 cr and we have the last quarter again which will be which will 32:39 32 minutes, 39 seconds be substantially high. So you will get the substantial yes sir. So uh it should be close to 60 32:46 32 minutes, 46 seconds or 60 odd crores for FY26. So it it is basically flat on a quarter and quarter 32:54 32 minutes, 54 seconds basis. I mean it will be basically flat right. 32:57 32 minutes, 57 seconds As I told you the last quarter will be beta. I can't give you the number which one whether it will be 60 or 65 or what 33:06 33 minutes, 6 seconds the revenue should grow I beta total I beta should grow more than around the tax should grow more than 20 30 to 35% 33:14 33 minutes, 14 seconds 40 40 to 50% and the revenue should grow by 25 to 30%. That is the overall guidance exact number we will not able 33:23 33 minutes, 23 seconds to give but we can only tell you that the Q4 will be better. So Q4 should be better on a quarter on quarter as well than year on year basis right? 33:31 33 minutes, 31 seconds It will be quarter on quarter and it will be quarter of the last year also. Okay. Thank you sir. 33:40 33 minutes, 40 seconds Thank you sir. 33:43 33 minutes, 43 seconds The next question is from the line of Sanjay Nadi from VT Capital. Please go ahead. 33:50 33 minutes, 50 seconds Hello. Hello. Yes sir. Please go ahead. 33:53 33 minutes, 53 seconds Yeah. Yeah. Good sir. Thank you for the opportunity. Uh so just like as you mentioned like we would be getting some orders from the BSS stage to the quantum 34:02 34 minutes, 2 seconds of 8,000 crores in the coming years. So can you please quantify like what would be the entire world for the BS like what kind of industry size would be for the BSS? 34:12 34 minutes, 12 seconds Samir can you can you highlight here? 34:16 34 minutes, 16 seconds Yes sure. So um the orders which we anticipate will be purely uh grid driven 34:23 34 minutes, 23 seconds um segments. So it will be more related to 5 megawatt DC block systems and 6.26 um DC block systems. 34:35 34 minutes, 35 seconds So sir can you please specify the entire industry size of the PSS like what kind of industry we would like to be catering with our new capacity the industry size? 34:45 34 minutes, 45 seconds Yeah. So the entire industry size is about 236 um gawatt over the next 5 years. So by 34:55 34 minutes, 55 seconds FY 32 for India this is the scale 236 gawatt hour. Now what SCML is doing is 35:04 35 minutes, 4 seconds uh we are positioning for at least 5 gawatt hour um in phase two uh which will be in the next um 1 to two years 35:13 35 minutes, 13 seconds and then we will expand that further to 10 gawatt and on a contrary of 36 gawatt capacity 35:20 35 minutes, 20 seconds by 32 why we are standing as of now sir because this is also driven by the tenders which is floating around the 35:28 35 minutes, 28 seconds market no I purely driven by that what is the Current capacity as on date as we talk sir what is the sorry 35:36 35 minutes, 36 seconds what is the current capacity of this uh BSS as we stop that like you are guiding for 36 kilowatt kind of capacity by 32 35:44 35 minutes, 44 seconds right so what will be the capacity as we talk sir so in terms of the container itself is 5 35:53 35 minutes, 53 seconds megawatt that's the capacity 5 megawatt is like 5,000 kilowatt hour okay as of date right 35:59 35 minutes, 59 seconds yeah as of date it's 000 kilow you can put it that way. Um so so 5 megawatt 36:07 36 minutes, 7 seconds into let's say 100 megawatt project you're talking about 20 containers and if you talk about one gawatt you're talking about 100 containers. 36:15 36 minutes, 15 seconds Okay. 36:17 36 minutes, 17 seconds Got it. And what is the broad market proposal? 36:20 36 minutes, 20 seconds I here always also wants to add like if you see the 266 gawatt which we are planning by 2032 36:29 36 minutes, 29 seconds which is sizewise roughly more than five lakh cr business which is going to become into the next five years and uh I 36:38 36 minutes, 38 seconds I it will not be equally distributed but that is the minimum which the government has already announced. So five lakh cr 36:47 36 minutes, 47 seconds business into the BS already there it will grow further. 36:55 36 minutes, 55 seconds Got it sir. And sir can you tell us like what would be the margin profile on this VSSs like on a soft note and also on a higher note sir you have broad margin 37:04 37 minutes, 4 seconds range sir when this industry will operate. 37:08 37 minutes, 8 seconds No as I told you uh it's it's a very clearcut guidance of our company that less than 10% we are not. So that is one 37:17 37 minutes, 17 seconds in OEM also we will try to get the 10% margin and DSS on the ETC to definitely 37:26 37 minutes, 26 seconds less than 10% we are not going to do that. So for all our new project including the DESS and power and water 37:34 37 minutes, 34 seconds you can consider 10% minimum as our margin and what could be the peak margin sir in this business. 37:45 37 minutes, 45 seconds Eat margin we will keep on announcing when whenever the order will come we will get the order because 10 is the minimum but maximum we can beat and 37:55 37 minutes, 55 seconds whatever we can get that but 10% is the minimum for for your calculation you can consider 10% anything but we are taking 38:04 38 minutes, 4 seconds like other projects whenever we take we try to maximize more than 10%. But 10% is the minimum by which we will take. 38:13 38 minutes, 13 seconds Got it sir. Got it sir. So wish you all the very best sir. That's it from my sir. I'll come back in a queue sir. Thank you so much sir. 38:20 38 minutes, 20 seconds Thank you sir. 38:22 38 minutes, 22 seconds Ladies and gentlemen to ask a question please press star and one. Now participants who wish to ask questions 38:30 38 minutes, 30 seconds may please press star and one at this time. The next question is from the line of Gandhi from HPMG shares and securities. Please go ahead. 38:45 38 minutes, 45 seconds Mr. Hardik, your line has been unmuted. Please go ahead. Hi, sorry. Hi. Yes, sir. 38:53 38 minutes, 53 seconds Yeah. Uh, so I just wanted to have one follow up on the power segment where anything other than BSS we are uh 39:02 39 minutes, 2 seconds planning to imple uh planning to bid for. 39:06 39 minutes, 6 seconds If you see a the historically we are we are the company which is focus into the 39:14 39 minutes, 14 seconds water and power and when we say power then it is a substation which we made uh because the renewable energy uh this 39:22 39 minutes, 22 seconds thermal more or less stopped from last 2 three years and it was more towards the renewable energy our power substation 39:31 39 minutes, 31 seconds business has reduced but suddenly the thermal power business has started in a big way and we are 39:38 39 minutes, 38 seconds expecting roughly around 40 to 50,000 cr of the substation business which are going to come into various NTPC and 39:46 39 minutes, 46 seconds various other states and uh and uh and the APSU unit we are targeting that 39:53 39 minutes, 53 seconds order also into into our KT right so but that I think is uh that is 40:00 40 minutes to be planned after four 3 to four years because all all the green field plants are expected to get commission by 29 40:09 40 minutes, 9 seconds 2029 2030 right so by when do you expect us to start getting at least the orders 40:17 40 minutes, 17 seconds in our books that is already floated like if you see the roughly around 8,000 to 9,000 cr of service station order is 40:24 40 minutes, 24 seconds already floated it is coming on daily basis every month you are getting the service station orders one the news they 40:33 40 minutes, 33 seconds are improving the service station they are including the base into the service station and this service station work is continuous. So we are expecting next 40:41 40 minutes, 41 seconds year we are expecting a sizable order into the service station and we are going to take at least one or two order of service station also 40:50 40 minutes, 50 seconds right so if you can just quantify like if there are 8 to 9,000 cr or order we are expecting 10% around 10 to 15% of 40:58 40 minutes, 58 seconds orders from that kitty or given our experience we can have a bigger chunk we should get one or two now the 41:06 41 minutes, 6 seconds substation business will be normally between 200 to 500 cr order. Now it depends which order we get but we should 41:15 41 minutes, 15 seconds get one or two right by next year we are expecting okay understood and what is the 41:22 41 minutes, 22 seconds execution timeline of the substation projects this require the transformer where the lead time is 24 months 41:30 41 minutes, 30 seconds understood understood so 24 months is to yeah that's it from yeah thank you so 41:37 41 minutes, 37 seconds much all the best thank you sir The next question is from the line of Kitika Kurana from Fintock Investments. 41:48 41 minutes, 48 seconds Please go ahead. 41:50 41 minutes, 50 seconds Hi, thank you for giving me this opportunity to ask the question. So my question is how does the competitive 41:57 41 minutes, 57 seconds land base in India look for a midsize player like HBN? 42:06 42 minutes, 6 seconds Can you pardon? Can you repeat again? Can you repeat again? 42:14 42 minutes, 14 seconds Yeah. So, uh my question is how does the competitive landscape for best in India look for a midsize player like SPML also 42:22 42 minutes, 22 seconds like what is the minimum take or pay commitment if any in your 10ear agreement with energy vault? 42:33 42 minutes, 33 seconds energy vault we have already procured the license we have purchased that and 42:39 42 minutes, 39 seconds now it is uh every year our uh order execution we have to pay 1.75 no 1.75 42:48 42 minutes, 48 seconds 1.75 is the royalty which we have to pay for which against which they will give us all the upgrade in the technology 42:57 42 minutes, 57 seconds which they will develop so in one way for our R&D facility we this much amount on the competitor side 43:06 43 minutes, 6 seconds on the other sector other than BESS in the ETC business. It is mainly to the PQ 43:13 43 minutes, 13 seconds and whoever have the PQ he has the they have the eligibility to bid and take the order. We are in the top four to five 43:22 43 minutes, 22 seconds companies in India into the water and maybe top 10 companies into the power. 43:28 43 minutes, 28 seconds So that gives us the mileage to take the orders compared to other midsize player who don't have the PQ because of our 43:36 43 minutes, 36 seconds maturity and existence of more than 40 years and our execution of 700 project 43:44 43 minutes, 44 seconds which we have done. We have the qualification of almost all type of water and power projects which are going 43:52 43 minutes, 52 seconds to come and that gives the advantage compared to any other midsize player because we can take the order. 44:02 44 minutes, 2 seconds Okay, understood. Uh and sir, is the company planning any further institutional fundraisers 44:09 44 minutes, 9 seconds uh to support the best capex or will it be entirely funded through promoter infusion and internal acrals? 44:17 44 minutes, 17 seconds If you see from the last 2 three years we have infused roughly around the 460 K 44:25 44 minutes, 25 seconds by part which is convert update also. So 460 K has been raised into the company. 44:31 44 minutes, 31 seconds The liquidity is sufficient. we are further getting 100 cr of the wallet money in the Q4 and early part of the 44:40 44 minutes, 40 seconds trail. So at the moment we have sufficient liquidity plus we have 500 cr of bank limit. We have 200 cr 180 cr of 44:49 44 minutes, 49 seconds c bond limit. So at this moment the liquidity is more than sufficient. You can see from our current ratio which is 44:57 44 minutes, 57 seconds 1.81 and uh at the moment we don't have any plan. Okay, thank you. That's all from my end. 45:05 45 minutes, 5 seconds Thank you. Thank you ma'am. 45:10 45 minutes, 10 seconds Ladies and gentlemen, to ask a question, please press star and one. Now participants who wish to ask questions 45:18 45 minutes, 18 seconds may please press star and one at this time. 45:23 45 minutes, 23 seconds The next question is from the line of Priyani Maha and individual investor. Please go ahead. Uh thank you for this opportunity sir. 45:32 45 minutes, 32 seconds So I had questions regarding the margins of the company. So our operating margins have been under pressure due to legacy 45:39 45 minutes, 39 seconds process. So what percentage of the current order book approximately I think around 4,500 K consists of this low 45:47 45 minutes, 47 seconds margin legacy contract and when do you expect the mix to shift entirely to high margin project? 45:55 45 minutes, 55 seconds As I told you out of the 4,358 cr gross order which includes our share 46:03 46 minutes, 3 seconds of uh JB also 2,800 cr is the order which is having the higher margin which 46:11 46 minutes, 11 seconds is the order which we have acquired in last one year and 1 1540 is the legacy 46:19 46 minutes, 19 seconds order. This legacy order will be completed into the next year or maybe one more year and this new order 46:29 46 minutes, 29 seconds contribution and proportion will keep on increasing into every quarter. One with the existing order second whenever we 46:38 46 minutes, 38 seconds will start taking the new order and the education will start. 46:43 46 minutes, 43 seconds Okay. Okay sir. Got it. Sir I had another question. this uh with the recent 159 K shorty bond limit secured 46:51 46 minutes, 51 seconds how much of a breather does this provide in terms of bank guarantee limit and also does this free up cash previously 46:59 46 minutes, 59 seconds held as margin money no if it's it's free of basically it's earlier when we started with the NCL 47:08 47 minutes, 8 seconds that time NBG etc we had to give 100% cash margin so now they we got the regular sanction from from the bank the 47:18 47 minutes, 18 seconds margin has reduced substantially low and it is a continuous process and we will keep on reducing the margin so that is 47:26 47 minutes, 26 seconds on the bank side on the shorty bond we don't have to give any margin okay okay got it that's 47:34 47 minutes, 34 seconds thank you thank you ma'am the next question is from the line of Kamill Jaswani from 47:43 47 minutes, 43 seconds capital please go ahead yeah hi Uh congratulations on a good set of numbers. Uh I just wanted to know 47:51 47 minutes, 51 seconds that are we also pursuing any projects in wastewater management? 47:58 47 minutes, 58 seconds Waste manage water management we are qualified but our focus is into the bulk sector where the pipeline etc is laying 48:06 48 minutes, 6 seconds of the pipeline that is our preferred because there we have a great connect with the suppliers and the execution 48:13 48 minutes, 13 seconds normally become fast but yes we are qualified for the waste water and we are also looking into the waste water. 48:21 48 minutes, 21 seconds Okay. And generally what are the margins in this uh pipeline water projects which we are currently Then 10% you don't take 10%. 48:32 48 minutes, 32 seconds Minimum 10%. 48:33 48 minutes, 33 seconds Minimum 10%. Okay. Because I was just I met one of the corporates recently who's into waste water management. They are 48:40 48 minutes, 40 seconds probably having margins in closer to 20%. So I was just thinking it's a great opportunity if we are qualified uh we 48:49 48 minutes, 49 seconds should also explore where margins can double. So that's why I just thought of checking with you if uh management can start 48:58 48 minutes, 58 seconds It's a project to project specific. It can be 20%, it can be 10%, it can be 15%, somewhere it is less than 10%, we 49:06 49 minutes, 6 seconds we don't take but there are few guys who are taking less than 10% also. It's depend on project to project. Risk 49:13 49 minutes, 13 seconds management has certain complexity and certain capex nature. So slightly the margin can be better and uh like the 49:22 49 minutes, 22 seconds distribution also have some complexity because you have to go to the city and you have to do the household connection. 49:29 49 minutes, 29 seconds So there's a complexity is slightly high the duration is slightly high then the margin can be slightly high when you do 49:36 49 minutes, 36 seconds the bulk then on the on the outer side you keep on laying so the education is very fast so slightly margin will be 49:44 49 minutes, 44 seconds will be lesser than to the waste management. So it's depend on to both plus and minus and it's a call of the 49:51 49 minutes, 51 seconds company paid on uh on each project whenever there is a bit come and we bid for that. 49:58 49 minutes, 58 seconds I got it. Thank you. Thank you for this uh answer. Thank you. All the best. 50:05 50 minutes, 5 seconds Thank you sir. As there are no further questions from the participants, I now hand the conference over to management for closing comments. Over to you sir. 50:22 50 minutes, 22 seconds Looking ahead, we believe STML Insight is strongly positioned for sustainable growth with a strong focus on water 50:29 50 minutes, 29 seconds power and dees discipline bidding, a strong balance sheet and an improving credit profile. We are entering the next 50:37 50 minutes, 37 seconds phase with a greater financial resilience and clear profitability visibility. Thank you for joining us today and for your continued trust and 50:46 50 minutes, 46 seconds support. We remain confident in our growth journey and committed to consistent delivering strong result. 50:52 50 minutes, 52 seconds Should you have any further question, please feel free to reach out to us or our IR advisor, Go India Advisor. Thank you once again. Thank you. 51:04 51 minutes, 4 seconds Thank you sir. On behalf of Go India Advisor LLP, that concludes this conference call. Thank you for joining 51:11 51 minutes, 11 seconds us and you may now disconnect your lines.