Good evening. Welcome to HCC's Quarter 2 FY 2027 call. From the HCC management, we have our Vice Chairman and Managing Director, Mr. Arjun Dhawan, our new CEO, Mr. Vivek Singhal, our Chief Financial Officer, Mr. Rahul Shukla, and our Chief Operating Officer, Mr. Santosh Rai. I may ask Mr. Santosh Rai to take you through the presentation. Over to you, Santosh.
Yeah. Thank you, Soubhik. Good evening, everyone, and I welcome you all to the quarterly analyst presentation for Q2 FY 2027. We'll quickly begin with sharing the highlights for this quarter. Just a minute, please. Yeah. A brief about HCC. As you all know, we are a nearly 100-year-old organization involved in most of the sectors of infrastructure, and these are some of our numbers, what you can see on the screen, in terms of our credentials. Here are the key highlights for our performance for Q2 FY 2027. Standalone turnover of INR 895.8 crore and net profit of INR 36.8 crore in Q2 FY 2027. Consolidated revenue of INR 896.8 crore and profit of INR 22.6 crore. Our standalone EBITDA margins are at 12.2% versus 16.1% in Q2 FY 2026.
We have been able to secure orders for INR 524 crore in this half part of the year, and also have been declared lowest bidders on bids worth INR 2,010 crore, where our share stands at INR 1,557 crore. It is to be noted that we have submitted more than 16 bids, around INR 34,805 crore, which are under evaluation. We are, at the same time, working on a strong pipeline, close to INR 86,000 crore in different sectors. We have also prepaid INR 100 crore of debt in Q2 FY 2027, with a target to further prepay another INR 108 crore by December 2026. Supreme Court has given an award in favor of HCC in a very important matter, and we have been successful about this. The money should be released in Q3 FY 2027.
I'm also happy to report that the Mumbai Coastal Road package two, which was constructed by HCC, has won the award in the best project category for bridges and tunnels by none other than ENR Global Best Project Awards. Our order book currently stands at INR 12,901 crore. The order book backlog is largely split across the four sectors where we operate. Continue to be led by transportation sector, which has surface transport projects like bridges, underground metros, followed by hydropower projects, nuclear, and water sector. These all orders are well spread across various parts of the country, with Maharashtra still leading the pack, followed by Bihar. Some of the operational update. What you see on the screen is our Indore Metro project, where already both the machines have started working. We are driving the tunnels through the city of Indore.
This is one of the largest underground packages in the country, with seven underground stations and six into 2 km, that is 12 km of TBM tunneling. Patna Metro, we have been progressing well on the project. Various design stages are in advanced stages. Mobilization of diaphragm wall equipment and everything is in progress. The machines procurement is also in progress, and soon we will see a lot of activity happening on this site. Agardanda Creek Bridge continues to progress well. We have been able to complete a lot of piling on the main approach side, a lot of piling on the marine, and substructure work has been progressing very well.
We are going to commence the superstructure erection in a month's time from now on this project. This is Bhivpuri PSP, 1,000 MW, which we are doing for Tata Power. You can see on the screen that the powerhouse is almost done.
It is completed, and so is the main access tunnel to the powerhouse. The other works on different sections of the project are also progressing well. This is Vishnugad Pipalkoti. Almost 80% of the job is completed. Tunneling works are nearing completion. Only 830 m of TBM tunneling balance in the HRT. Dam is nearly 80% complete, and so are the other structures at the project. At Tapovan Vishnugad, again, despite the geological challenges, the works are progressing in extreme, I can say, difficult geological conditions, but we are progressing well as per the time schedules agreed with the client. This is our FRFCF facility. A lot of works here again are completing in the completion stage. Almost 87% of the job is done, and we are looking forward to completing this job at the earliest. This is a Hindalco pot shell and pot superstructure project.
Again, here, all the production is ongoing in line with the commitment to the clients. Parwan Dam, the dam is completed. All the safety checks have been completed, and in fact, the reservoir filling test and everything has been completed on this project. Only some pertinent ancillary works are balanced, which will be completed in over next three to four months. Salal Dam, this basically is a project for rectifying the hydro-mechanical works in the Salal Dam, which was built by HCC in the 1970s. The operations have started on this project, and they will be going on in full swing. I will hand it over to Mr. Rahul Shukla, our CFO, to take you through the financial statements.
Good evening, everyone. In this quarter, we have done INR 923 crore of turnover, vis-à-vis INR 975 crore in the same quarter last year. For this quarter, we have done EBITDA of INR 109 crore, PBT of INR 48 crore, and profit after tax of almost INR 37 crore, which is more or less same as the quarter last year. On a consolidated basis, our turnover is INR 925 crore. EBITDA is INR 102 crore. Profit after tax is almost INR 23 crore. Not much of difference between standalone and consolidated as such, because HCC is the main driver of the numbers here. With this, we are closing the presentation, and now we are open for question and answers. Soubhik.
Yeah. We can start the question-answer sessions. Please raise your hands, and I will request each participant to limit their questions to a maximum of two in one turn. We can come back to you once everyone has gotten a chance.
Hello? Hello?
Mr. Harish, please go ahead with your question.
Good evening, team. Our EBITDA margins have come down to 12.1% vis-à-vis 16% last corresponding period. Can you illuminate the points related to why this EBITDA is lower in these numbers?
Mr. Harish, this construction business is kind of seasonal business, and sometimes you will see that there are some elements of the project with high margins will be executed. Sometimes some lower margin projects are executed. On a quarter-on-quarter basis, matching EBITDA is not very realistic. We have been maintaining that our average long-term EBITDA on year-on-year basis is in the range of, say, 13%-14%. By the year-end, you will be able to see that. That is what we hope to achieve. But every quarter, it is difficult to match that kind of-
I understand. I understand. The second question is, our standalone and the consolidated, there is no much of growth in the top line, and there is a degrowth in the net profit. Can you explain any particular reason for that?
Standalone, as I said, is the one who is driving our numbers because consolidated is not much of the business on subsidiary level.
Okay.
With regard to growth, we are currently focused on building very strong order book. As Santosh mentioned that we have submitted tenders of north of 35,000 crore, and we are very soon expecting these bid results to be announced.
Okay.
This will give very big boost to our order book. We are certainly targeting that by end of the year, we should be somewhere doubling our order book. From there, these numbers will start percolating, and you will start seeing growth. Naturally, in the past, because our order book had stagnated, that's why you are not seeing much of a growth. But certainly, with the progress in order booking and all, you will start seeing.
I understand. But net profit at the consolidated level has come down. So that means we are making losses in the subsidiaries?
See, there are certain insignificant subsidiaries wherein some, these are accounting entries kind of, wherein we have given some loans, and their interest accrual keeps on happening. So it's not really any material business loss kind of situation there. But yes-
Okay.
At the face of it on books, it does look like a loss.
Okay. Thank you. Lastly, can you share some update on this BKC bullet train station?
I will request Santosh to-
Yeah. I mean, the work is progressing, I can say, slightly behind the target, but it is progressing. There are interface with other packages, and we believe we will be able to complete it in line with the other packages.
I would appreciate if you include into the presentation for the people to know what is happening over there. Thank you.
Oh, sure.
Thank you very much.
Sure. Well noted. Thank you.
Thank you, Mr. Harish.
Thank you.
Mr. Amit Singh Chhabra, you may go ahead, please, with your question.
Hi, sir. Amit here. Basically, I am an investor. I have HCC in my kitty. So, one of the priority for me, when I can see the increment in the stake from the promoter side, because 82% of the shares were pledged, and the promoter holding, if I check from last four quarters, it is not in a good trend. So what is your take on it?
Amit, we have mentioned this earlier also. Promoters have been infusing money in the company, and they certainly look forward to infuse further money. And at an appropriate time, certainly, we look forward to increasing stake also. But certainly, depending on priorities of the company and other situations, it will happen when right opportunity is there. So, be assured that we are on track. That is there in our mind.
One last question from my end. Also, I have noticed, from last year onwards, we have seen a decrement in the interest portion, around 26%. Is it a part of the profit?
Sorry, you are talking about reduction in interest?
Yes, that portion I am talking about.
Yes, certainly. I mean, reduction in interest is a part of profit because it flows there, right? Am I missing something?
Not at all.
Okay.
This was my question. When we can see some sort of good momentum in terms of, you said, INR 35,000 CR already, it was in bidding. What kind of expectation from those bidding? How much project we can acquire as per your expectation? Any tentative number in mind?
Amit, I think you might have heard our CFO saying that by the end of the year, we are looking to nearly double this order backlog, which is currently standing at INR 13,000 crore. This should give you a feel that what we are talking about, and that's our prediction, I can say.
Thank you so much for all the questions. For all the answers, sorry. Yeah, take care. Bye.
Bye.
Thank you, Amit. Mr. Kunal Tokas, you can go in next, please.
Yes. Hello, am I audible?
Yes, please go ahead.
Okay. Hello, and good evening. My first question is, how long will the adverse impact on expenses in the consolidated P&L continue because of various non-material subsidiaries that you talked about?
How much of expense?
How long will the impact that various non-material subsidiaries are having on consolidated P&L statements continue for?
Mostly couple of quarters. All these things will be taken care of, and interest accrual and all that is happening, that will stop accruing. Couple of quarters.
Then the standalone and console should match pretty well on both revenue and profitability, right?
Yes.
Okay. And second question is on your order book and the lack of growth there. We have been seeing both L1 positions in bids submitted that you are giving your presentation for quite some time now, but the orders are lacking. It could be very helpful if you can explain the reasons for that. The consequences can be either industry-wide, order awards have slowed down, or something specific to HCC. As a supplement to that, if you can also give your bid success ratio for the last one year.
Yeah. Kunal, I will address this in two parts. Look, I think I will answer your last question first. Bid success ratio is a very difficult number to be put out like this because we are still working on it, and largely, we do not share this information, yeah? Coming to the reasons why this order has been delayed, you will appreciate some of these orders are into hydropower sector, which are requiring lot of preparation and clearances from the client side before they can award these orders. Though some of the tenders have happened, we believe that our clients are still taking some time to secure those respective clearances and then award these jobs.
Which is yet.
That is the key reason. As we have said, I think we have made lot of bids, and we believe we fairly stand a good chance of securing some good orders from these bids, which should show our order backlog to a totally different position by the end of the year.
As the CFO said, the order book, you expect to double by the end of the year. Is that right?
That is a possibility.
A distant possibility or a close possibility?
No, I think-
Okay.
I think-
All right.
I think-
Okay.
Yeah.
All right. Thank you very much. Have a good day.
Thank you.
Thank you, Kunal. Mr. Chandrashekhar Daga, you may go ahead, please.
Yeah. So, this order book doubling that you are referring to, say possibly you are looking at it at the end of the calendar year or financial year?
Financial year.
Okay. Thanks.
Any further questions? Please raise your hands if you have any further questions.
Soubhik, I think there are no more questions.
Kunal, you have another question? Yes, please go ahead.
I'll ask Mr. Kunal Tokas a question. The strong order book growth that we expect, would just be, as you said, in the hydro segment?
It will be a blend of hydro and transport structure where we That's our area of core focus. Yes, it could be largely led by hydro because we have submitted more bids in that sector.
Would there be any super large projects in that can really move the order book?
No, let me just I appreciate the reasons why some of these questions are being asked, because the further detail will give you more color, but we can't share this information. What I can basically tell you is that the bids that we have made are numerous in number, diversified across each one of our core segments. We have had probably slightly more bidding in the hydro segment in the recent months, and that's the reason why basically we've seen a little bit of delay in the first half, because hydro projects tend to actually be tend to take a little more time to come to market. As far as the country's infrastructure program is concerned, there continues to be a very robust market for infrastructure projects.
What I will tell you that HCC continues to be very selective with regard to the clients we pick and the contracts we choose. While perhaps maybe because in the recent past we have seen a volatility in commodity prices and the fact that maybe in some segments we have seen a little more competitive intensity, that does not basically change the way we think about risk and how we will price it. I think what you will see from us is a responsible pricing of risk, and the selection of clients will continue to be of the best order. As the team has actually said, by the end of this year, we should play a substantial catch-up with regard to building of our order book.
That is good to hear, Mr. Dhawan. Just to change with regard to accounting, after this prepayment, what would be our debt prepayment liability on the coming March?
We will be paying almost, after this payment, around INR 350 crore should be the liability that we will have to pay in March.
If I may add, the goal for us has been, as we have communicated very, very clearly in previous quarters, a clear imperative is to ensure that we are debt-free as early as possible, which should certainly be. We are certainly on target to do that. Next couple years, we want to be able to achieve that purpose.
Okay. If I remember from some of the earlier con calls, you had talked about opportunities outside of India. Any updates on that?
Yeah, we have. I mean, some of the prospects which we have been chasing, we have been qualified as a bidder into those projects. These bids are still, I can say, 12 months away. It is a long process. We are actively pursuing it.
All right. Thank you very much and have a good day.
Thank you, Kunal.
Thank you.
Mr. Amit Singh Chhabra, please go ahead.
Sir, no more questions from my end. I think everything has been clarified. Good work so far. I hope to see positive results in coming time.
Thank you.
Thank you, Amit.
Yeah, sir.
Just want to just take the opportunity to just wish everybody a very, very happy Diwali to all of you and your families. Look forward to speaking again in the next quarter.
Great. Take care. Bye.
Thank you all.
Thank you.