Ladies and gentlemen, good day and welcome to the conference call hosted by GE Vernova T&D India Limited for Q2 of financial year 2025-2026. As a reminder, all participant lines will be in the listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing star then zero on your touchtone phone. I now hand the conference over to Ms. Megha Gupta from GE Vernova T&D India Limited. Thank you, and over to you, Ms. Megha.
Good evening, everyone. Welcome to the GE Vernova T&D India Limited earnings call for Q2 of financial year 2025-2026. I am Megha Gupta from Investor Relations team, and I am joined by Mr. Sandeep Zanzaria, CEO and MD of the company, Mr. Sushil Kumar, Whole-time Director and CFO of the company, Mr. Abhishek Shivasta, Head Business Operations, Ms. Kanika Arora, Communications Leader, and Ms. Shweta Mehta. Before we begin the call, I would like to highlight that today's discussion may contain a few forward-looking statements which are subject to risk and uncertainties, and actual results may differ materially from those expressed or implied. Now I turn the call to Mr. Sandeep Zanzaria to initiate the discussion.
Thanks, Megha. Good evening. Welcome, everyone. India's energy goals, including the ambitious target of 500 GW of non-fossil fuel capacity, mean a fundamental redesign to our transmission backbone. We expect peak power demand to climb by close to 80% by 2032, necessitating an unprecedented expansion of the grid. This outlook for the transmission segment remains highly positive, alongside strong prospects of the generation sector. The government is planning to add 36 GW of hydrostroke PSP storage, 90 GW-100 GW of conventional capacity by 2035, and 100 GW of nuclear capacity by 2047. Since transmission is generation-agnostic, it will continue to be one of the most stable and growth-oriented segments in the coming years. At the heart of this expansion is the necessity of HVDC technology.
It is the most efficient and reliable way to transport bulk power over long distances, connecting remote renewable energy paths to consumption centers and stabilizing the national grid. There are significant opportunities emerging in HVDC, STATCOM, and digital solutions. These areas will play a key role in driving overall growth. On the technology front, digitization is a major focus, as performance management is being positioned as a key differentiator, helping customers optimize both CapEx and OpEx strategies. With this growth in mind, we are expanding our engineering and manufacturing footprint with additional investment of INR 8 billion, focused on advanced grid technologies. This investment will expand our capabilities at Vadodara for transformers and reactors. We will install new lines for bushings and air-core reactors at Hosur. We will also expand capacity for AIS and GIS products at Hosur and Padappai.
The above capacities will support domestic market as well as exports. This investment of INR 8 billion is in addition to the INR 1.4 billion investment announced in May this year. Now turning to our financial performance, we had a productive, strong quarter of robust demand, significant revenue growth, and EBITDA margin expansion. Our order book remained strong in Q2, and we saw a booking of INR 16.1 billion, down 66% year-on-year compared to INR 46.8 billion in Q2 ended September 2024. Our Q2 revenue stood at INR 15.4 billion versus INR 11.1 billion in Q2, FY 2024-2025, up by 39%. New orders outpaced revenue, further expanding the order backlog to INR 131.1 billion as of September 2025 versus INR 129.6 billion as of June 2025, up by 1% quarter-on-quarter.
Our profit before tax and exceptional items for the quarter ended was INR 4 billion compared to INR 1.9 billion in the corresponding quarter of the previous financial year, growing by more than 2.1x. The cash and cash equivalent balance was INR 15.2 billion as of September 30 versus INR 12.2 billion as of June 30, 2025. The cash generated in Q2 was INR 4.3 billion before payment of dividend. If you see the results, it's a very strong set of numbers what we have delivered for the quarter and for the H1. Overall, urbanization, rising per capita energy demand, and increasing investment in industries, data centers, and green hydrogen are creating strong drivers for energy growth.
These trends will naturally translate into higher demand for transmission infrastructure. Technology will play a crucial role in strengthening the company's position among the top transmission players in the country. It is indeed an exciting time to be part of this sector. On behalf of the leadership team at GE Vernova T&D, our sincere thanks to our valued customers, our dedicated investors, and our exceptional teams. I'll now request Abhishek to share the execution highlights.
Hi, good evening, everyone. Just like previous quarters, we have been continuously and actively delivering our commitment for strengthening the transmission network of the country. In this pursuit, some key highlights that we want to share with you all for the last quarter are the 400 kV substation days that we commissioned for T&D Sikurja. T&D Sikurja is a thermal power plant of 1.3 GW, which has been fully functional now and adding to the power supply demand of the state of UP . The plant was made fully commercially operational on the 22nd of September, and we partnered with T&D Sikurja in this journey for building up the capacity of electricity generation in the state of UP. Another key highlight was a 300 MW wind power evacuation substation set up for Vivid Renewables in the state of Karnataka.
This was the first time we were actively working with this company, and we had completed this project in a record time of less than 12 months. Now this is fully commissioned and supplying power to the adjoining states and regions. Similarly, we have been partnering with other developers and commissioning our products, predominantly transformers, like for Power Grid in 765 kV Dosa, single-phase ICT 500 MV commissioned, 400 kV station of Kallam, where we commissioned a three-phase shunt reactor of 63 MVAR. [audio distortion] of India Narela 765 kV substation, where we had commissioned a 110 MVAR single-phase shunt reactor.
Similarly, we had been partnering with other developers in terms of commissioning and supporting them through the supply of GIS products. We had commissioned successfully 220 kV GIS for Transglobal at Ganesh Nagar, similarly 220 kV GIS for Jindal Stainless Limited at Jajpur. At several sites, circuit breakers right from 765 kV to 145 kV had been commissioned, and we had been actively working and supporting our customers like Godrej, Elecnor, Tata Projects, and Adani. We remain committed in terms of strengthening the transmission network of the country and making it more and more robust through our products and services. I hand it over to Sushil Kumar to take the floor.
Thanks, Abhishek, and good evening, everyone. Turning to financial slides in the investor presentation. Overall, we had another strong quarter with strong revenue growth, a high EBITDA performance, and strong cash generation. Now we have a very healthy level of cash and cash equivalent, as highlighted by Sandeep. Overall, the demand remained robust, and we booked orders of INR 16.1 billion compared to INR 46.8 billion in Q2 of financial year 2024-2025. Last year, in the orders of INR 46.8 billion, we had a few large orders amounting to INR 31 billion. These included the order from the export, large order from export, and a couple of large orders in our software business.
Excluding these large orders, our last year's order book number was close to INR 15 billion-INR 16 billion, and hence the current quarter performance in the current financial year is in line with what we achieved in the last year. In this quarter, most of the orders were booked from domestic customers, representing 83% of the orders, and 17% of the orders were received from the export side. The orders in this quarter were received from various diverse sets of customers for all categories of HV equipment in our portfolio. These included orders for transformers and reactors, GIS and EIS equipment, automation products from various utilities, TVCV players, and EPCs. Our backlog remained healthy at INR 131 billion. The solid backlog is three times the revenue of last financial year, that is financial year 2024-2025. We are building this backlog in a very disciplined way through disciplined underwriting.
97% of the backlog is from private customers, central utilities, and public sector units. The exposure to state utility remains limited to the extent of 3% of the backlog. Healthy backlog gives a strong visibility of long-term growth in our business. We had another quarter of strong execution, achieving a revenue of INR 15.3 billion, delivering a significant 39% growth year-on-year basis. In this quarter, about 32% of the revenue was generated from execution of export contracts, whereas 68% of revenue was generated by execution of domestic contracts. Overall, in the first half of this financial year, we are achieving INR 28.6 billion of revenue, again a growth of 39% on year-over-year basis. We reported a strong EBITDA of 25.8% during the quarter, representing an EBITDA expansion of 70 basis points over the EBITDA that we delivered in financial year 2024-2025. This significant increase in EBITDA is driven by volume, price, and productivity. Deep diving a bit more about these three individual components. So first.
Sorry to interrupt. Shall we start with the Q&A? Hello. Please go ahead.
Sorry for the technical glitch. It seems the main line got disconnected, and you were not able to hear me. We'll just wait for a minute.
The conference is now being recorded.
I think the members were, the investors were able to hear our conversation, but I'll maybe start again from the EBITDA point. So we delivered a strong EBITDA of 25.8% during the current year, sorry, the current quarter, representing a 70 basis point increase over the EBITDA that we achieved in the financial year 2024-2025. The significant increase in EBITDA was driven by three factors: volume, price, and productivity. Volume is up 39% as we talked. The price is higher compared to the orders that we were booking in the past. The last couple of years, we booked orders at a significantly better price. The third element of productivity is basically our internal better performance through lean and effectively managing our operations. Overall, in the first half, we delivered an EBITDA of 27.3%.
Our H1 EBITDA of INR 7.8 billion is almost very close to the INR 8.2 billion EBITDA that we generated in the entire financial year of 2024-2025. Now, with this strong performance in H1, we are confident that for this financial year, we should be able to deliver EBITDA in the mid-20s. In addition to strong P&L performance, we continue to generate positive cash flow. In H1, we generated entire profit after tax, which is approximately INR 5.9 billion, into cash. As a result of this positive cash generation, we now have a healthy cash and cash equivalent of INR 15.2 billion with no debt.
This cash balance is after returning INR 1.3 billion to shareholders in the form of dividend in quarter two. A healthy level of cash balance supported by strong market demand gives us confidence to continue to invest in our core business. As Sandeep mentioned earlier, today we announced INR 8 billion of CapEx in addition to the INR 2.4 billion CapEx that was announced earlier so far, leading to the overall expansion plan of INR 10.4 billion. All this CapEx is planned to be sourced from the internal accrual. We can now open for questions and answers.
Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on the touchstone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Umesh Raut from Nomura, India. Please go ahead.
Yeah, hi sir. Good evening and congratulations for a very strong set of results. Sir, my first question is on the ordering side, especially outlook for domestic orders on the base ordering side for transformers, switchgears, and circuit breakers. How do you see the second half panning up as compared to H1, considering that in H1 we have seen challenges with respect to industry four, ROW issues or slower tendering? How do you see the outlook in terms of the second half? Second, similarly in the case of export markets, considering that we have a broad proposal of closer to INR 3,000 crore in terms of ordering from the related party, what is the exact update on that particular outlook in the subsequent second half?
I think on the ordering side, Umesh, you are right that. Hello? Am I audible?
We request Umesh Rao, can you please mute your line because there is a disturbance from your line, sir?
Hello. Yeah, Umesh, so I think. Umesh, yeah, we have seen some softness in the decisions or basically the pipeline which is there. I'm expecting it to pick up because the National Committee of Transmission, for example, if you see a lot of projects which have got identified. We expect this pipeline to be much stronger in the time to come. On the RPT side of INR 3,000 crore, as we said that at that point of time, we were bidding for the group entities were bidding for a large project. The outcome of that has not yet been finalized, so that's why we have not yet received any order or any confirmation. The opportunities are livestreamed.
Got it, sir. Second question is pertaining to the CapEx announcement of INR 8 billion. If you could quantify CapEx in four heads that you have mentioned in your presentation. How does that divide in between transformer reactors, air core reactors, bushings, and GIS and AIS products?
I think. Those finer details we will not be able to share. That's why we have shared an overall number with the breakup of what all activities we will be doing in the CapEx.
Okay, okay, got it. The last question is on the data center side. For our company, what kind of opportunity do you see in the case of data center? Which all products can we supply? Are we qualified for international orders with respect to data centers? If yes, which all geographies where we can supply those products for data centers?
Data center mostly, for example, if you see large data centers which are coming, they have substations which will get built from 220 kV up to 765 kV. On the receiving of the power, we are qualified for all the products which are there. If, for example, there are local EPCs which are participating, then we support them with gas-insulated switchgears, with transformers, automation system, or at times we directly participate for the project as well.
For the international market, definitely we are qualified. Today, data center market globally, of course, we know that US and all is a big market. Again, US market, as you know, that is a big tech technology market. There, most of the market is being fed from the US factories only. Balance other places also, for example, if there's any opportunity which comes to us, we'll be targeting that along with our group companies.
Got it. How much of the addressable market can we get into in overall data center CapEx? Any percentage number here?
You're talking about the complete data center package?
Yeah, yeah. Suppose data center costs at about, say, INR 40 crore per megawatt basis. How much of that total CapEx we can address in terms of providing our production solutions?
I don't know about that, but if you take a—can you go on? I think you have two lines, Umesh. A data center typically, for example, a 200 MW, 300 MW data center will have close to about INR 75 crore-INR 100 crore of opportunity pipeline from our side.
Got it, sir. Thank you so much and all the very best. I'll join back with you. Thank you.
Thank you.
Thank you. The next question is from the line of Mohit Kumar from ICICI Securities. Please go ahead.
Yeah, sir, good evening and congratulations on a very, very strong result. My first question is, sir, while you have done very superbly in the first half. Is it possible to give some color on the margins in the current order book beyond FY 2025? And the related question is, are you seeing some—are you seeing same kind of pricing power, what you have done in the new orders?
Good evening, Mohit. I think Sandeep mentioned in the earlier call that prices are now kind of stable. We are neither improving nor deteriorating. In terms of margin, I think we do not give a forward-looking guidance for multiple years. I said earlier in the call that in this financial year, we should be able to deliver an EBITDA of around mid-20s.
Some call on the pricing environment, sir, are you facing—is it similar or is it changing or is it worsening or improving compared to last year?
I would say that it's not improving. At least the prices are not going higher. I would say at the same level or there is slight pressure on that, but not a substantial one.
Understood. My second question is, sir, your parent entity has bought JV stake in Prolek, right? Do you see any implications of this on our business in India and medium term in terms of our offering or to try this for market?
No, sir. Prolek is more or less dedicated to North American market. So we don't see any impact of that happening in our territory.
At the end of reading the transcript, I think more about increasing our time on the data center side by providing power-to-rack solution. Have you heard any conversation around that?
No, but Prolek is a transformer manufacturing joint venture.
Prolek has nothing—
No, no, Prolek has nothing to do on low-voltage side.
That was the outcome, of course. I was reading the transcript of the global industry. I mentioned they're looking towards—anyway, sir. Last question is, sir, what is driving this phrase CapEx? Of course, you're doing a large CapEx compared to your current gross plug. How much is the export as a driver for the investment? Some color will be helpful, sir.
I think if we really look at the market scenario which is there and the plan of the national transmission plan, I feel, and if you look at our export potential as well, I do not think that this is a fine balance of CapEx, what we are doing. That has been thought over, meticulously planned, and then only we have discussed thoroughly in the board, and then only it has been approved. Of course, going forward, you know, it is very difficult to predict going forward that this is the number which is going to come from export, this is the number which is going to come from the domestic market. Also, the CapEx involves multiple products, like air core reactor, bushing, a transformer reactor, maybe part of AIS product, GIS product. There are multiple products. Everything will have a different ratio of export and domestic, so it is not possible to give kind of one number for that.
Understood, sir. Thank you in all the ways, sir. Thank you.
Thank you.
Thank you. The next question is from the line of Amit Anwani from PL Capital. Please go ahead.
Hi, sir. Thanks for taking my question. First question is on the CapEx. Just wanted to understand two things. One is your current capacity utilization. Second, with this CapEx, including INR 150+ million, INR 800 million, what could be the possible peak revenue target you would like to achieve in upcoming years? Third, in the event of HVDC win, would you be requiring further CapEx or the current expansions would be covering any HVDC wins also?
Thank you, Amit, for asking these questions. Different products have different capacity utilization. For example, transformer reactors have a pretty high capacity utilization. AIS, GIS, we still have threshold to go further up in terms of taking more orders and increasing the utilization factor. Of course, CapEx is also looking into the market. We are also preparing ourselves for the future because the implementation of CapEx is also going to take two to three years. For HVDC today, definitely we can deliver at least one HVDC order with the existing capacities we have. We are preparing ourselves because if you look at the HVDC pipeline, that's a pretty strong pipeline. Regarding peak revenue, peak revenue is a combination of a lot of factors which include, if you win an HVDC, then there's a large part which comes from third-party sources, including engineering and technology part of it.
I think difficult to give a number of peak revenue, but definitely, if you look at about INR 1,500 crore of quarterly revenue, then we are looking at somewhere between INR 5,500 crore-INR 6,000 crore of annual revenue this year, which is again going to be close to about 35% growth over last year. If you look at our backlog as well, as Sushil said, if you take last year's order—the backlog and last year revenue, we are sitting at close to about three times of the revenue. I think we still have a lot of headroom to increase our revenue, and that's what this additional CapEx is going to increase, that headroom and let us grow further.
Sure. Second question on the margin. Very strong margins in Q1, Q2. I can see a lot is happening on the cost optimization, as you have been highlighting the operational efficiency. The other expense was only 10%. Just wanted to understand, and you have guided for some 25 kind of mid-20% EBITDA margin. Is there any scope with respect to current factories and more cost optimization? The newer CapEx which is coming would have a similar kind of advanced facilities that the expenses would be controlled. Some understanding on how we are able to achieve this so far? Is there more headroom with respect to the fixed cost optimization?
Thanks, Amit. Cost optimization is a journey. I mean, in GE, we adopted process at lean, which means continuous improvement over the achievement that we have already secured. This is something that will continue. As you see, most of the CapEx investment is into our existing facilities. The INR 8 billion that we announced today is entirely for the existing facility. Part of the earlier announcement was for a separate new facility. Considering that we are investing in our existing locations, it is expected to give us more operating leverage because we do not plan to have additional fixed costs. In the earlier questions, Sandeep answered that we are growing at 39%-40% of revenue. In future, if this further revenue comes with this CapEx plus HVDC, if we win and so on, of course, there will be an operating leverage from now onwards as well.
Right. My final question on the order inflow. H1 saw roughly about INR 3,200 crore and exported about INR 500 crore, which is obviously relatively lower since we had a very strong intake in H1 last year. As for HQ, it is quite high. I wanted to understand, are we eyeing very strong finalizations, as you highlighted, that National Committee on Transmission has a very strong pipeline? I just wanted to understand some color because we had a very strong intake, FY 2025, and H1 indicates H2 should be very, very strong in terms of inflows to continue the momentum. Second, color on HVDC order status, South Kalam and Uhlpath, the value and the nature. Are we bidding together with someone or some color if you would like to give there, that would be helpful.
I think the South Kalam order is, South Kalam, the South Uhlpath order is very much active. However, we will not be able to give any other further details on that, neither on the value nor on the participation part of it because the bids are under evaluation. The second project, which is Balme to South Kalam, I think we expect the tenders for the developers to come next quarter. That is the next year order, what we expect based on the finalization schedule what we see today.
Pipeline for H2, sir, if you could.
Pipeline for H2, yeah. Thank you. Pipeline for H2 is, I think we are looking at a decent pipeline which is coming in H2. Of course, last year when we had participated and when we have delivered a very strong order number, it had two large, as Sushil had said, two large factors built into it or orders built into it. One was the related party transaction order, which was close to about INR 2,200 crore. Then a few digital orders put together. Excluding that, we are looking at close to about INR 7,000 crore. We are looking at repeating that. That is the target of the team, to repeat at least a similar number of order intake. That will also give a growth in the order backlog by more than INR 1,000 crore-INR 1,500 crore.
Thank you, sir. If I can squeeze the capacity expansion, anything in mind with respect to exports also while setting up this new CapEx?
When we are sitting at the plant, of course, when we look at the market, we look both at the domestic market as well as the export market. Eventually, the capacities will go where we get the most optimized return on the CapEx.
Understood, sir. Thank you so much for answering the questions. Thanks.
Thank you.
Thank you. The next question is from the line of Nitin Arora from Axis Mutual Fund. Please go ahead.
Hi. Thanks, Sandeep, for taking my question. The first question just on the pipeline part. Are you also seeing some refurbishment pipelines also coming with respect to HVAC existing lines or HVDC lines relating to system upgrade and walls? If yes, how big is this opportunity according to you? Second, how should we think about this related party of INR 3,000 crore? Do you think the order finalization should happen by Q4, is what you are eyeing, or will it happen once this CapEx gets completed? How should one think about that? That's my first question.
Thank you, Nithin. There is a market for HVDC and HVAC refurbishment, definitely. The numbers are not that big to make a substantial impact. For HVDC and all refurbishments, the customers take a pretty long time in finalizing and making a decision. HVAC, for example, today, we see a few opportunities which are coming in pockets, but that's not a very big business today. As far as the RPT of INR 3,000 crore order intake, of course, a large part of it is dependent upon the customer decision-making process. That, in any way, is not linked to the CapEx. Because if it would have been linked to the CapEx, we would have first taken a CapEx approval, and then we would have gone for the RPT approval. If you look at that CapEx approval, if you look at the RPT approval, the RPT very clearly said that the deliveries are up to five years. That's a pretty long cycle we have.
We take the decision by Q4 in the current scenario. However, it may change depending on the customer's plan.
Okay. Got it. That's very helpful. Second, with respect to you saying that this pipeline is increasing only, opportunities are increasing only, so you have already bids coming in now going ahead for Q3, Q4. Sorry for asking a short-term question. Just to understand that there is nothing which has lost out here. Lastly, we've been following you for long now, so you have been articulating so far no pricing pressure because despite capacity catching up, opportunity size is increasing and order pipeline is increasing a lot. For example, when you said one HVDC, how much capacity gets booked for a transformer company across if one HVDC gets rolled out. How should one think going in next year, next two years?
I know I'm asking something a little longer aspected, but do you think opportunity size will be huge enough where you see growth at least for the next two, three years for the sector to remain pretty strong? That's where it should not, I mean, obviously, you're such a healthy margin company [INR 50,000 crore] doesn't matter here and there. Journey has said how one should look at it. These two aspects, just a short-term question on the momentum in ordering and on the pricing growth for the next year.
Looking at the momentum, in between, there was a slight lull, but now I think we are seeing again a pickup which is happening. It's not a major one, but at least there is a pickup, uptick which is happening in the pipeline for the TPCB. Regarding, for example, when you are looking at capacities, etc., which is now getting added, practically the capacities which are coming, for example, whatever CapEx we have also announced, is like three years. Most of the capacities we expect to come in two years plus or three years' time. Today, a large part of the order intake, what we do is like a 24-month cycle. That is maximum what you get, 24 months-27 months or 30 months. What you are saying is right. We need to see the next year pipeline. Because next year, there will be an additional impact of new capacities coming in like two years' time. If the pipeline remains healthy and more HVDC or more TPCB gets decided, it is going to offset between the pipeline and the additional capacity.
Got it. Got it. Thank you, Sandeep, and all the team.
Thank you, Nithin.
Thank you. The next question is from the line of Shukdeep Mithra from Nueva Wealth Management. Please go ahead.
Good afternoon, sir, and many congratulations on an excellent set of numbers. Just wanted to understand that with an order book which has an export mix of 35%, and we understand that the export bid tends to have superior margins, do we see an annualized export mix in sales remaining around that 30%-35% mark? In the same vein, can we then assume a mid-20s kind of an EBITDA margin could be the new normal?
Shukdeep, yes, you're right that our backlog has about 30%-35% of export mix. On a long term, we expect that revenue execution should be also in the same proportion where export will be around 30%-35% of revenue. This quarter, it was 32%. See, we are now doing mid-20s kind of EBITDA. The endeavor of the management is to maintain a healthy margin. As Sandeep answered, that typical cycle is 18-24 or 27 months. We already have a backlog for the next two years with us. Hopefully, we should be able to maintain the EBITDA margin about 20%. Our endeavor is also to go beyond EBIT as a percentage and look at more EBITDA as a number.
As we grow our revenue at 39%-40%, which is happening, and our run rate for the annual revenue exceeds, the EBITDA, while it may be slightly lower than what we are delivering today, but in value terms, the EBITDA will be higher. This quarter also, if you see, the EBITDA percentage is lower than the previous quarter, but EBITDA number is higher than the previous quarter. That is the effort of the management. With the additional CapEx, the operating leverage that we earlier talked about, plus counting on HVDC to come at some point of time, the overall EBITDA as a value will be more focused for us.
Understood. If I understand you correctly, you are endeavoring to keep the EBITDA above the 20% mark. Probably somewhere between 20%-25% is where you would want to keep the EBITDA number.
I'll more focus on EBITDA as a value. I think percentage, as I said, becomes less relevant if the volumes keep growing at a higher pace. Yes, our endeavor will be to remain at a healthy margin, not giving a specific number, but will remain healthy.
Understood. Lastly, I just wanted to understand that do you see an HVDC pipeline panning out beyond the current two which are getting into bidding? Beyond the South Uhlpath project and the Balme project, do we see maybe another two HVDCs coming up for next year, maybe the Alphatia project or the Bikaner project?
Yeah, sure. We see that at least two projects more in pipeline after the Balme and this thing. Maybe in a shorter time after the Balme one gets floated. Maybe one is Lakkadia one, and one will be one more.
Bikaner four and Lakkadia almost.
It's going to be from Rajasthan only, the next two projects.
Understood, sir. Thank you so much. That's it from my side.
Thank you.
Thank you. The next question is from the line of Deepak Pandey from Sagun Capital. Please go ahead.
Hello. Hi, hi. Thank you for an opportunity. Congrats on a good set of numbers, sir. Firstly, just wanted to understand market size of sales in India and what sort of demand are you seeing domestically and exports? Also, what sort of market size do we hold?
Can you repeat the question? Because your voice is breaking in between, Deepak. Hello.
Mr. Pandey, can you please repeat your question?
Yeah. Just wanted to understand the market size of GIS in India and what sort of demand are you seeing domestically and in exports?
I think we'll not be able to give you the market size of the GIS offhand because GIS comes in two ways. One, it is a part of a project, and then a lot of new opportunities as well. There is a robust demand for GIS opportunities because of the space limitations and also the right-of-way issues. Also, at places like, for example, if you go to places like Khawra and all, where the environmental conditions are so harsh that you cannot put in GIS products. There are multiple factors which are today driving the demand of GIS product. On the export market as well, we are seeing a much higher traction of GIS happening, including the European countries, etc. Of course, for global market, it depends upon market to market. It is very difficult to give an overall number for an export market opportunity for GIS.
Got it. And sir, secondly, on the same lines. What percentage of your GIS system, BON, is currently being imported versus locally sourced? Is there a number to it that you can provide?
It depends upon different voltage to voltage. For example, 145 kV, more localized, 765 kV. There is still a process of localization going on. It would be like between, on the minimum side, it would be like 55%-60% to, on the higher side, it could be like 75% plus. Localized.
75% local? Local only?
Yeah.
Got it, sir. That's it from my side. Thank you.
Thank you. The next question is from the line of Sameer Thakur from Ambit Capital. Please go ahead.
Hi, thanks. I have just one. I just wanted to check what is the current capacity which you have for transformers, for power transformers in MVA terms, if you can disclose?
Sameer, that's what I keep on saying, that capacity in transformers in MVA is a very different thing because, for example, an HVDC transformer, you might have a 500 or a 400 MVA HVDC transformer. If you compare it with an equivalent AC transformer, it might be like a 1,200 MVA or a 1,500 MVA. Actually, if you look at the rating plate, it is only 400 MVA. The same thing happens with STATCOM transformers. The same thing happens with PSC transformers. Then, of course, reactor is a different volume. For a three-phase 500 MVA, it's a different revenue realization, and the number of hours is different than a 500 MVA, 765 kV single phase, which is much more easier to build. That's what I keep on saying, that MVA is not the real metrics of tracking a transformer factory. It is more a combination of ratings which actually make the revenue mix rather than an MVA capacity.
Okay. That was all from my side. Thank you.
Thank you. The next question is from the line of Renu Baid from IIFL Capital. Please go ahead.
Yeah, hi, team. Thanks for the opportunity. So my one question would be, while we have seen multiple cycles, and obviously, this cycle has been pretty kind after a very deep down cycle, in your view, this 20%+ kind of margin range by one metric and endeavor to maintain, how long can this rising or demand-supply mismatch sustain in the market in your view? Last cycle, it was for about 12 months-18 months, the peak profiteering phase. This cycle, in your view, could it be like two years, three years? How long could it continue?
Renu, I think that's what Sushil said, that we are not giving a guidance, and the endeavor of the management is not to look at now at a 20% or a percentage margin, but it's more like to grow the revenue and then to see what is the absolute delivery of margin, what we are able to achieve on a higher revenue.
My question was also from an industry perspective, not just from the Vernova T&D, but many other peers also in similar range. Any comments from an industry perspective of the peak margin profile on the pricing side? Is it now almost kicked out with taper down in the next few quarters, or the party may long much longer than what one is expecting?
It's difficult to comment, but there are a few factors which, let me tell you, Renu, this is what I feel. Is it, of course, there's not a large—now pricing up is difficult now. Another capacities are coming, not today, but at least maybe in two years down the line, and maybe from next year onward, there will be more capacities coming in. It's also going to depend upon the demand which is going to come into the market. Looking into the government plan of multiple HVDC projects, and then also looking at offshore wind, if you're also looking at 36 GW of PSP, if you look at data centers, there are various factors. On the demand side, I don't see a slowdown happening like in the previous cycles in a very fast fashion. My assessment is that this time, the demand is going to last much longer. Obviously, I'm not saying that we've reached the peak, but I don't see a very high growth of percentage margins happening. Not only, and I'm talking about the industry. I'm not talking about GE Vernova T&D happening from.
Second, in terms of, would you have any pipeline of projects internationally where we are supporting the parents on the HVDC or other project side? Any material large ticket size projects which you can highlight? Anything notable?
Today, we have taken an approval of about INR 3,000 crore for an RPT, which is yet to be decided. That was taken with our AGM. That is what is the presently the information which is available in the public domain. If there is any other opportunity which will come, we'll go through an RPT process where all the shareholders are informed at the same time.
Got it. Got it. Lastly, while, yes, there is discussion on the HVDC and other projects, so far, we have not been able to successfully get any project at a reasonable price. You think with fewer LCC in pipeline, we should now be at an advantage to at least secure one or two of them, given the other peers are already reasonably full with projects in their books?
That's a commercial strategy. That's a commercial strategy which is going to depend upon customer, competition, and us, all three. It's going to be a dynamic between all three. It's very difficult now to make a prediction what is going to happen in the future on the HVDC decision-making.
Got it.
I can just say, which we have been saying, that HVDC is a focus area for our growth, something which we have been maintaining, which we keep on stressing on this.
Got it. Thanks much for these words from my side. Thank you and all the best.
Thank you, Renu.
Thank you. The next question is from the line of Parikshit. Please go ahead.
Yeah, hi, Sandeep. Congratulations on a great quarter, sir. My first question is that the CapEx which you have announced, that's almost, and including the old ones, totals to almost $120 million, [1040 kW] base. I think last time, the global CapEx which was announced was $600 million, and out of that, $20 million was in grid solutions. I just wanted to understand, I mean, especially in Asia, where we have other factories in China and Japan. The quantum of CapEx announced for India seems to be very, very high. After many years, is there any thought that for Asia, at least, and part of Europe, India may become a manufacturing hub for the parent company?
Parikshit, we have been, I think, in the various calls, etc., we have been saying that today, because of the global demand for the electrification or for the energy transition, there are a lot of boundaries depending upon the opportunities which are broken, not only by us, the customers also in accepting the factories from India. It is not that we are looking at India becoming a declared hub for this thing for Asia and all. We will see the opportunities coming. For example, if I get a better opportunity in the domestic market, I will go for export. As you said, export normally gives a few percentage higher. We will still maintain a mix between export and domestic market.
Okay. Again, related to that, sir, I mean, earlier you highlighted that domestic, maybe the pricing has stabilized. Now in the export market versus last quarter, the RPTs which you have signed and the ones you announced in the AGM, or other which you are evaluating, is there still any positive delta or any comment on the pricing on the export market side?
No, no, no. Export market is difficult to comment because it comes from different geographies where you have different competitions. Export cannot be put in a block of a pricing strategy like the domestic is being done. In domestic also, for example, state electricity board is different, and central utilities, it is different. For example, private customers are different. There is no set rule for that. Similarly, for export, when we have different countries which are there, it is very difficult to put a block saying that, "Okay, this is going to be the export percentage or export margin percentage." Australia might be different. Japan might be different. Africa might be different. Bangladesh might be different.
Okay. Just the last question, sir, on this. After this India CapEx which happened, will it imply that India will become the largest factory, at least in Asia, compared to Japan and China? Also, if you can comment on the product acceptability in Asia and other geographies from India, has it improved over the last two, three years? Because we have seen this rise in the export opportunity even in the RPT. The product acceptability also, if you can comment.
I'll say that, again, as I've been maintaining. Even without the CapEx or with the CapEx, we will be one of the largest facilities, one of the largest facilities in Asia. That's for sure. Regarding when you talk about the acceptability in Asia and all, as we have said in the past, for example, certain countries have a different voltage. For example, a country has a 362 kV or a 500 kV. That is not an Indian voltage, is what gets produced in India. So that is fed from a different factory. For example, wherever there is a 400 kV or a 245 kV, definitely it's going to fit. It's not something where, as for example, we become the sole source for Asia, but there are different factors which make a decision, like the voltage rating, the delivery cycle, a lot of other factors which help decide that a specific opportunity to be targeted from which factory.
Okay. Any dedicated line being transferred to us? In this CapEx, I mean, have we won any mandates for global manufacturing from here?
There is nothing like a global line which is being put for, like a line which has been put for a global, dedicated global applications and all. There is nothing like that. It is purely, as we have declared in our press release or the presentation, it is a flexible thing. Depending upon the opportunity, the expanded capacity can be used for domestic market, can be used for exports, either/or or both.
Sure, sir. Thank you. Those are my questions, and I wish you the best.
Thank you, Parikshit.
Thank you. The next question is from the line of Umesh Raut from Nomura, India. Please go ahead.
Yeah, hi, sir. Thank you for following up. My question is on the power stability solution side, especially on STATCOM. You have earlier mentioned about closer to 2025 projects on the STATCOM side, where supplies closer to $1 billion to be awarded in the next couple of years. Where exactly are we currently, and is there any delay in terms of transmission from the STATCOM opportunity in terms of new orders?
There's a slowdown at present. Hello. Umesh, please mute your line. Umesh, there's presently a slowdown, at least in the STATCOM opportunities. I think next year, we expect them to bounce back, and we'll have much more opportunities for STATCOM. This year has been a lull for STATCOM opportunities.
Got it, sir. Second, sir, if I look at, say, strategy-wise, parent has also product offering towards grid-scale energy storage side. In future, in medium term, do we expect to launch any products on those side?
Grid-scale?
Grid-scale energy storage. For example.
No, no, no. We are not planning anything on that side.
Got it, sir. Thank you. Thank you so much.
Thank you, sir.
Thank you. The next question is from the line of Mayur Patel from 360 One Asset Management. Please go ahead.
Most of the things got covered. You said there was a lull in demand for a while. That was related to the Indian market or the export market or both markets? That's question number one.
That was in the domestic market.
Okay. And sir, second thing is, in addition to, you said the pipeline is such that you can end up having the same base order inflow like the last year, excluding the lumpy ones. Is it fair to say, in addition to that, the pipeline also includes the HVDC, one HVDC this year, which you said is under evaluation, and there could be more lumpy orders in export and Indian markets which could.
Sorry to interrupt. We lost the line for the participant.
I think we have reached the close of the hour. We can close the call. Or if he's joining, then we can answer that.
Mr. Mayur, if you can please press star and one. Yes, he's joined back. Mayur Patel, please go ahead.
Yeah. Yes.
So Mayur.
So just.
Whatever question you had asked till now, I will answer that. We have taken an RPT approval for INR 3,000 crore. If GE Vernova wins that project, then definitely we'll have that opportunity coming. We don't know. Our endeavor is, global endeavor is to take the order before Q4. If we are able to do that, then of course, that's a big order which is going to come in. As we said, there is one HVDC which is under discussion, under finalization. If we are able to win that, then that will be over and above what numbers we are talking.
Sure. Perfect, sir. And just one more, if I can squeeze in. Data center is going to be a huge opportunity unfolding in the Indian market itself, based on just the three, four public announcements which we have seen. Do you expect FY 2027 to be a year of some material inflows from data center as a segment for you?
Yes. Today also, we get orders, but you are right that it is not, because the number of data centers is pretty not as significant as in the U.S. and all. We get orders, but not as significant, like a percentage of our overall order intake. It is pretty small. I expect that, I think with the recent announcement, India story of data center is going to become much bigger and bigger. You are right. We expect 2027, 2028 to be a much bigger story for data centers.
Thank you and all the best.
Thank you, Mayur.
Thank you. Ladies and gentlemen, that was the last question for today. I would now like to hand the conference over to Ms. Megha Gupta for closing comments.
Thank you, everyone, for joining the call today. We hope the insights provided by our speakers have been informative and valuable to you. We value the trust and support of our investors and analysts and ensure to remain committed to maintain transparent communication and fostering strong relationships. If you have any further questions or require additional information, please do not hesitate to reach out to me or our Communications Leader. Thank you.
Thank you. On behalf of GE Vernova T&D India Limited, that concludes this conference. Thank you for joining us, and you may now disconnect your line.