Ladies and gentlemen, good day and welcome to Ahluwalia Contracts (India) Ltd., Q3 FY22 post-results analysts conference call, hosted by Ambit Capital Pvt Ltd. 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 0 on your touch-tone phone. Please note that this conference is being recorded. I now hand the conference over to the management of Ahluwalia Contracts (India) Ltd. Thank you, and over to you all.
Good afternoon, this is Shobhit Uppal. Thank you all for joining us. We have announced our financial results for Q3 FY22. During Q3 FY22, the company has achieved a turnover of INR 683.50 crore, and a PAT of INR 42.33 crore, in comparison to a turnover of INR 536.13 crore. and a PAT of INR 14.72 crore in Q3 FY21. EPS of the company for Q3 FY22 is INR 6.32 as compared to INR 2.20 in Q3 FY21. During Q3 FY22, the company's EBITDA margin is 10.89% as compared to 6.80%, PAT margin of 6.19% as compared to 2.75% in the corresponding period of last financial year. During the 9 months ended on 31st December 2021, the company has achieved a turnover of INR 1,961.60 crore, and a PAT of INR 112.91 crore, in comparison to a turnover of INR.
1,220.49 crores and a PAT of INR 40.17 crores in the nine months ended on 31st December 2020. EPS of the company for nine months ended on 31st December 2021 is INR 16.85 as compared to INR 6.00 in the corresponding nine months of the last financial year. During nine months ended on 31st December 2021, the company's EBITDA margin is 10.75% as compared to 8.46%, PAT margin is 5.76% as compared to 3.29% in the corresponding nine months of the last financial year. Net order book of the company as on 31st December 2021 stood at INR 6,662 crores to be executed in the next 2 to 2 and a half years. Total order inflow during 9 months ended on 31st December 2021 is INR 1,267 crores. Thank you. Those are our opening remarks. We are open to questions now.
Thank you. Ladies and gentlemen, we will now begin with the question-and-answer session. Anyone wishing to ask a question may please press star and 1 on your touch-tone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use hands-free 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 Vibhor Singhal from Phillip Capital. Please go ahead.
morning, sir, thanks for taking my question. Congrats on very strong execution yet again. I think the last 3, 4 quarters have been really strong for us in terms of execution. So, sir, just wanted to basically ask two questions. One is, sir, in this quarter, we did a top line of almost the same as the last quarter. Generally, second quarter is impacted by monsoon. While we did very well this quarter in terms of a 28% YoY growth, was there some impact of monsoons or some other external factor because of which the execution was maybe a little lower than what we and maybe you were also expecting? And could that also spill over to the next quarter?
Look, our execution or our output is in line with what we had projected.
Okay.
So we are not disappointed. Yes, NGT ban affected the working in and around NCR for about a month or so. But that now is an annual feature, and we had expected that. Otherwise, you know, the supply chain has been affected. Though projects continued, the third wave did affect the supply chain. But, you know, our execution output is more or less more or less on expected lines.
Sure, sir. Sir, since you touched upon the third wave of impacting the supply chain, so have we seen any impact in the first 45 days on execution in Q4, or do you think it should be again a good strong quarter for us again?
Well, the quarter would be strong, but yes, as I said, the headwinds are there, while the work has continued. But and things are improving, but the supply chain is affected, as can be seen from the volatility in the prices of the raw materials.
Got it, sir. Got it. Sir, our margins also were quite stable at around 10%, despite, as we mentioned, about the very sharp jump in all the cost raw material prices. Do you believe we should be able to take the margin back to our historical levels of around 12%-13% in the next couple of quarters, or do you think it's gonna be some time before we reach those levels?
So I had mentioned in the last call, three months ago that, you know, in the coming financial year, we are expecting to take it back to those levels.
Okay. Next year, we should probably expect in a similar kind of range as we had been doing earlier?
Yes.
Got it, sir. Got it. The last question on the order book. Our order book, while at quite strong at around INR 6,600 crores, as we mentioned, but I think the order inflow this year has been around INR 1,200 crores, quite, I mean, significantly lower than what we have come to expect from you, given the very strong order inflow in FY21. So anything that you would want to maybe call out on that part that because of which, we, I mean, is there more of competition, or are you expecting some lumpy orders to come in the next few months?
So this is also, if I may say, by design. I had mentioned again and repeating in the last call, and my various interactions with all of you, or some of your colleagues, that there has been intense competition. We deliberately, while we continue to bid, but we are not throwing caution to the winds. We deliberately are being conservative. That's why, since we are well stocked in terms of our order book, we are deliberately being cautious, and we are not bidding indiscriminately.
Got it, sir. Got it. Thank you so much for taking my questions. I'll get back in the queue if I have any further questions.
Thank you.
Thank you. Reminder to the participants: anyone wishing to ask a question may please press star and 1. The next question is from the line of Ashish Shah from Centrum Broking. Please go ahead.
Yeah. Thank you. Good afternoon, sir.
Good afternoon, Ashish.
Thanks. Sir, first thing is, can you just talk a little bit about the overall working capital situation in terms of number of days, what where it stands? You know, our historical some pockets of problem like West Bengal, Bihar, etc., how are they at this moment?
So I'll answer your second question first. The historical, problematic projects, so to say, they're no longer problematic. Our projects in West Bengal, the auditorium project and the Milan Mela project, which primarily are the projects with the state government, they are well underway and nearing completion. The auditorium will be completed in September, and the state government is now releasing funds for that. The Milan Mela is slated for inauguration in March or 1st week of April. As far as Bihar is concerned, our projects now, the two hospitals are now moving successfully, and we are looking at a targeted completion end of this year for both the hospital projects.
large project, the INR 890 crore animal husbandry project, the veterinary college, and animal husbandry project that we had said last time also is awaiting environmental clearance and is slated, was projected to begin in April, and that is still so. The first meeting of the environmental committee has happened, and in the second meeting, the clearance is expected to be granted. As far as the working capital cycle is concerned, Satheer, we'll take that question. Satheer, go ahead.
Working capital cycle?
Yes, sir. Working capital cycle is around 89 days.
Sir, sir, I can hear you very well, sir. If you can just speak a little louder, sir. Thank you.
Of course, sir.
Hello? Are you hearing me?
Yes, yes.
That's working capital cycle is 89 days.
Okay. Our gross debt will be zero, right? I mean, or almost negligible?
Yes.
Yes, yes.
Okay. And the cash position, if you may, please?
Cash position. Cash position is INR 172 crore.
172 crore. And mobilization advances?
320 crores.
320 crore. Okay. Just last question,
That is 270. 270.
270. Okay. Just lastly, what is the status of the Sion Hospital, which we got, and the Tata Hospital as well? When are we likely to commence work in those projects? What is the overall position? If you can please highlight that.
The Tata Hospital, the approval, it's gone for approval to the central ministry. The board of Bhabha Atomic Research and Energy Center, they've recommended it, and it's gone to the central ministry for approval. As far as the Sion Hospital is concerned, the construction is underway.
Okay. Sure. So how much is done, approximately? I mean, did we start in Q3?
Yeah, we started in Q3. At the moment, at about 10% is done.
Right. Sure, sir. Thank you. Thank you very much.
Thank you.
Thank you. The next question is from the line of Parveen Akkar Qazi from Edelweiss Securities. Please go ahead.
Yeah, hi. Good afternoon, my question and congratulations for the good set of numbers.
Thank you.
So first, with respect to TADA, I mean, obviously, there is going to be some impact, as you already highlighted. So based on whatever has happened till now, do we expect that we'll be able to match at least Q3 execution in Q4, or it can be lower than what we have done in Q3?
Sir, we should be able to cross a turnover of INR 2,500 crore.
Got it.
If that answers your question.
Sure, sure. With regards to FY23, what is the kind of growth that we are now targeting?
20%.
20%. Also with respect to, you know, bidding intensity, and we have been highlighting for the past couple of quarters that it has remained high. Has there been any change in bidding, or it continues to be intensive? In light of that, what is the kind of other intake that we could see going ahead?
We are targeting an order inflow in the next financial year of about INR 2,000 crore-INR 2,500 crore. As I had mentioned last time, the intensity will continue to be high continues to be high and will continue to be high at least in till the first half of the next financial year. But what we are seeing is that, you know, the, the large scale of projects of larger magnitude, the numbers is increasing, right? We are bidding for two projects. The tenders are underway, which are in excess of INR 1,500 crore. So and then, we're bidding for about five, six projects, which are between INR 500 crore-INR 800 crore. So such orders now are increasing, if you understand what I'm saying, right? So, competition in such orders is expected to be lesser.
Okay. Sure. These were my questions. I'll come back to it. Thank you.
Thank you.
Thank you. We'll move on to the next question. That is from the line of Rajat from iThought. Please go ahead.
Hi. Thanks for the opportunity. Sir, just wanted to understand, are we facing any issues when it comes to, you know, payments from the government or otherwise private clients?
As you know, nearly 85% of our order book is with the government, and out of that, nearly 50% is healthcare. So on those projects, we are not facing any problem. As far as the private sector is concerned, most of our clients are clients with whom we've had a long relationship. So there also, there are no major problems.
Okay. So basically, no, payment issues so far we are facing. No, no issues we are facing, right?
At the moment, no.
Okay. Sir, on the raw materials side, just to understand, I mean, have we moved to what kind of fixed price orders do we have? I mean, what percentage of the total order book do we have as fixed price order book right now?
I think about 15% of our order book is fixed price.
So, just to understand this impact of rising raw material costs, and all, which everybody's facing the heat. So, are we also facing the heat only in that part of the order book, or how are we, how is it?
No, in that part of the order book, so definitely, we are facing the impact. In some of the other order book also, you know, while cement and steel price is governed by for price escalation is governed by indices for cement and steel, so that, over the long term, kind of balances out. But the other escalations are covered by WPI, which we are finding that the increase is not commensurate with the increase in the prices of those raw materials like aluminum, copper, so on and so forth. So there, yes, in the short term, we are expecting to take a hit.
Okay. All right. Sir, what led to the decline in other operating expenditure in quarter three? I think the number came to INR 6 crores from INR 1,670 crores last quarter.
Now, repeat your question. You're saying the decline?
Yeah, decline in other expenses.
So,
Yeah.
Just last quarter, we have made a provision for the Kaka expenses.
Payments.
Payments. That Kaka payment, that is around INR 6 crore. And, because of that, it's the amount that exists with the INR 3.5 crore, that has been,
Written.
Yes, in this quarter.
Okay. It has been written back, you're saying, right?
Yes.
Sorry. I couldn't. Did you see? Yes? So that, back since we utilize funds in excess of what we were required to do, that we have written back.
Understood. Understood. Sir, how is the order pipeline for the hospital side at the moment?
At the moment, our order book, you know, the pipeline, the pipeline is about INR 2,500 crore. The hospitals are about INR 1,000 crore.
Okay. Understood. And, sir, are we seeing any, traction in the private side now? And this is my last question. Are we seeing any traction in the private side?
Yes, we are, but as an industry, yes, but we are very wary. We continue to be wary. But yeah, on the private side, for industrial construction, we are seeing green shoots, and that is something that we will be focused on going forward.
Okay. All right, sir. Thank you so much, and wish you all the best.
Thank you.
Thank you. Reminder to the participants: anyone wishing to ask a question may please press star and one . The next question is from the line of Shravan Shah from Dolat Capital Markets. Please go ahead.
Yeah, thank you, and congratulations for a good set of numbers.
Thanks, sir.
Sir, yeah, sir. Sir, coming to the revenue front, you said in excess of INR 2,500 crore for FY22. So if I do the math, then it comes only INR 538 crore for fourth quarter, which is significantly lower than the last time, INR 761, and this quarter, INR 683. So just trying to further understand how much can we see, flatties or decline or some growth in the fourth quarter, whatever?
No, no. I said excess of INR 2,500 crore. INR 2,500 crore is the projection that I had given last time. So it will be well in excess of that.
Okay. And next year, you said it would be a 20% growth we are looking at?
Yes.
And then, whatever the pressure you said on the input cost, despite that, we can see a 12% kind of a bigger margin next year?
Yes. Because, you know, we have already in the large projects that we are doing, we have already booked in the orders where materials where the prices have been exceptionally volatile are used, okay? So and the further orders that we are expecting to get should cover the prices should also stabilize. The increase would not even if the increase is there, it would those the price increase would not be as volatile as it has been in this year. So we are expecting, yes, that we will get back to 12% margins.
Okay. On the order inflow, so, are we L1 in any of the orders, and how much we can add in next 1.5 months?
Hopefully, we are hoping that this order in which we are L1. We are L1 in one order, which is this Tata. It's about INR 715 crore. This should come in before the year closes.
Okay. And nothing other than that, we have bid where we can see some inflow can come before March end?
We have bid for three other large projects, which aggregate about INR 2,000 crore. But it's difficult to say as of now whether they will be awarded before the close of the financial year.
So, these 2,003 projects would be in NCR, and in the hospital segment?
One is in hospital segment. All three are residential. Two are in NCR, and one is in Jaipur. One is hospital. The one in Jaipur is a hospital.
Okay. Okay. Got it. Sir, I need a couple of data points, particularly order book pickup, segment, region, and government-private.
Let me provide them to you. Yeah.
I think sector-wise, government is 85%, and private is 15%. Segment-wise, this is commercial, 4.83%, hospital, 44%, infrastructure, 12.26%, residential, 17.43%, and hoteling, 1.03%.
Sir, could you repeat the last 21 again? So 12.61, post that, can you repeat?
Okay. Infrastructure, 12.26, institutional, 20.44, residential, 17.43, and hoteling, 1.03.
In terms of the benefit mobilization advance, you said INR 270 crore. How much is retention and unbilled revenue, sir?
Yeah. Hold on. So retention is INR 196 crore.
Okay.
Total detractors, besides retention, is INR 490 crores, total INR 687 crores. Inventory, INR 251 crores.
Okay.
Unbilled is INR 327 crore.
Sorry. Unbilled is how much?
Unbilled revenue is INR 377 crore.
377?
27.
Okay. And how much is payable, sir?
Payable is INR 634.
634. CapEx, how much we have done, and how much left for the fourth quarter?
Pardon?
CAPEX. CAPEX.
CapEx, how much we done in nine months, and how much left for the fourth quarter? CapEx for nine months, INR 19.70 lakhs. And total INR 4.56 crores.
Sorry. INR 4.56, to be spent in the fourth quarter?
No, no. He's saying INR 4.56 has been spent out of INR 19. INR 4.56 has been spent in the third quarter. In the fourth quarter, it is likely to be about INR 2 crore.
2 crore. So, sir, even in the next year also, the range will remain INR 30 crore-INR 50 crore only, the CapEx?
No, it should be about same. Say we are looking at about INR 21 crore-INR 22 crore this year. It will be in the same range.
Okay. Okay. Got it. Got it. And the working capital days, as you've mentioned, that now, in terms of the payment from the West Bengal, no issues as such. So, it should. Can we see some improvement in the working capital days by March end?
Yes. Not by March end, but in the next financial year, definitely. I think with the pandemic behind us, the working normalcy should start happening as far as the finances of various state governments is concerned.
Okay. Okay. And, sir, you also mentioned about some big tenders. So, INR 1,500 crore apart from INR 2,000 crore that you said you bid, and then INR 2,500 crore is the bid pipeline. So apart from that, anything that you want to highlight in terms of the orders that we can look at in next six months, nine months?
No, I don't want to go for obvious reasons. Do not want to go into specific details. I've already given you broad numbers, and the scale of the jobs that we are interested in bidding for.
Okay. Okay. Okay. All the best, sir. Thank you.
Thank you. Thank you.
Thank you. The next question is from the line of Parikshit Kanpal from HDFC Securities. Please go ahead.
Yeah. Hi, Shobhit. Congratulations on our good quarter. Sir, my first question is, the total order inflow financial year to date is how much and total order backlog?
Your voice is a little blurred. It's a little reverberating. Could you repeat the question?
I was asking, what is the total order inflows, FITD financial year to date, and what is the total order backlog?
The net order backlog INR 6,662 crores. Order inflow till date is INR 1,267 crores in this financial year.
INR 700 crore, the Tata hospitals, it comes, and we'll close that year at about INR 2,000 crore in order?
Yes.
Inflows, sorry.
Yes.
So my question is that now we are on a very high base, and we are INR 2,627 crore, so upward of INR 2,500 crore, and next year, we're projecting 20% growth. So historically, we've been taking INR 2,000-INR 2,500 crore orders. So from the growth perspective, we need to now ramp up these inflows. Otherwise, we're not able to grow at 10%-15%. So any sense, any views there, I mean, for the years ahead, I mean, can the order inflows be much higher than that INR 2,500 crore number you are guiding?
Generally.
Because growth should not keep up the pace.
No. So generally, you know, our, with our track record and what we project and what we plan, we always aim to replenish what we the kind of revenue or top line we achieve. That quantum, we should replenish, right? So this year, we should close at about INR 2,000 crore. We've deliberately been conservative, as I said, keeping the competitive intensity in mind. We didn't want to be indiscriminate, and we were well stocked up. So next year, as I said in one of the earlier comments in this call, that we are targeting about 2 and a half thousand crores, INR 2,000 crore-INR 2,500 crore. And then hopefully, in the following two years, it should go up significantly. It should cross INR 3,000 crore.
Got it. The second question is, Sanjeev sir, if you can give a breakup of the order book region-wise north, south, east, and north.
Yes, sir. What you're asking?
Region-wise order book.
Region-wise. Okay. This is east 43.69%, north 37.25%, and west 18.32%, south 0.75%.
So again, the short answer to my question was on south. So you earlier in the call, you did touch about that there are three projects. So you're looking at two residential projects, currently in NCR. So just wanted to.
One, one is a residential project. One is a commercial project. And one is a hospital in Jaipur.
Okay. So, from my viewpoint, the south market continues to be the best-performing residential market, so where we have negligible presence. So, and, everyone is talking about real estate upcycle. And there are tier-one developers that are gaining market share. So again, my question here is, are we looking to increase our exposure in the south market? Are we increasing our business development activity, bidding activity there? So because you are an old player in this segment, and there is really lack of quality players in the building segment, of your size and execution capability with a strong balance sheet. So any reworking, any rethoughts, on bidding on the private real estate in south?
So yeah, two parts to your question. One part, whether we have revived or we are increasing our business development activities in the southern part of the country. Yes, we are. We, in a month ago, we bid for the AIIMS, Bibinagar project in Hyderabad. We were not L1, but that tender has since been canceled. And we are going to bid again progressively. But the second part of your question, whether we are going to be focused on targeting private real estate developers in the southern part of the country, in the short term of the next six months, no. We want this, this part of the private sector to stabilize further. We want to bide our time and then decide who we will work with as far as the private real estate developers are concerned.
This is purely based on our experience and experience of our contemporaries with developers in the past 5-7 years. So we are being cautious.
So basically, government BD will continue, and you will try to ramp it up as and when the orders come in. Private, you will wait and watch till things stabilize as far as financing?
Yes. Yes.
Okay. Okay. And just last thing on the margins, sir, you said next year, we'll touch about 12%. So that would be something like a peak margin for us, or, whereas can you believe there is some more headroom that we can go between 12%-13%, given the current state of commodity prices? So can you give some color there?
Look, next year, it will be about 12%. I think the peak margins, if memory serves me right, we had crossed 13% at one point in time. Ultimately, yes, the aspiration is to get there. But next year, let me stay with the projection that I've given earlier.
Okay. Okay. This BuS Terminal project, any thoughts on monetizing it, or it continued, or?
Sir, just repeat that, please. Hello?
The Bus Terminal project, that.
What are any thoughts?
Yeah. So any thoughts on monetizing it, or it continue with us, like, what is the profitability?
I think it will be continuing. You know, the market scenario being what it is, due to the pandemic, yeah, ultimately, we would want to monetize it. But the response has not been up to our expectations. So yeah, we will continue. I think in the short term, we will continue the way we are. But let me tell you, you know, during December, that mall has hit the highest footfalls, especially at the time between Christmas, and New Year, that mall hit the highest footfalls that it has ever seen. So things are improving. And that's why, you know, maybe the monetization bit may happen in the next year to two years.
Okay. Just the last thing on, sir, we have some residential inventory which we have taken over with our payments. Plus, we have some raw land lying at the Lincoln Park of Country and some other places. So any thoughts if you can quantify what is the total residential inventory lying with us, and any thoughts on monetization of residential inventory, and the land banks which we have?
Residential inventory is currently at INR 38.90 crore.
38.90 crore, sir?
Huh, huh.
We are looking to buy and buy. We are disposing this off. We are looking to dispose this off.
Any disposal in this quarter, sir, or?
In this quarter, there has been no disposal, no.
What about the land banks which we have, like, for the raw land which we have in West Country?
There is one raw land, large chunk of land, which we have in Kolkata. We are looking to get the land use changed and then monetize it. Either we will develop it, or if we get a good price, we our first priority would be to dispose it off. But that is now become a very prime chunk of land because we have metro development. We have a station coming there. There is a mall, a station is already there now, and there's a mall next to it. So it's actually in the heart of the city now.
Where is it, which location, and how many acres?
This is totally about 4.7 acres, and it is near the Highland Park development, the Highland Mall. It's on the Eastern Metropolitan Bypass.
What is the market value, are you saying, since you have brought a sense from this question, the market value?
Frankly speaking, at the moment, I would not be able to answer to the value to that.
Okay. Sure. And what kind of development do you look at? Because you said you will look at changing these and develop it. So is it a kind of?
It would be primarily a residential development if at all we go that route.
Is it like we are trying to now get into real estate, or did you just say one of?
No, no, no. No, no, no. Not at all. We are not trying to get into real estate. Whatever howsoever we can best leverage this piece of land, we will do it and get returns on that.
Maybe it will be one of you have one of projects that you're looking at?
Yeah, yeah. We have no intentions of becoming a developer.
Sure, sir. Thank you, sir. That was all my question. Thank you.
Thank you.
Thank you. The next question is from the line of Jitin Roshi from Axis Capital. Please go ahead.
Good afternoon, sir, and congratulations on good setup on this. Sir, I just want to understand on the central stock opportunity. So going forward, what kind of opportunity we see, and where are you qualified to bid for these projects? And what is the timeline where you can expect the awarding to happen, sir?
So look, there is one tender which has come out of the Central Vista, of which prequalification has been done. There are four companies qualified, which is Larsen & Toubro, Tata Projects, Nagarjuna, and Ahluwalia Contracts. We this tender is due for bidding in the last week of March. We will definitely bid, but, you know, again, seeing how aggressively, the likes of L&T and Tata have bid, and, you know, our experience with the first projects which we successfully handed over, margins were muted for obvious reasons. So I don't know. We will not bid aggressively. So that is the first, that is the next Central Vista project. After this, I think the next project will come out in about five to six months' time.
So basically, this is for which part of the Central Vista? This is the project which you have bid for?
This is the executive enclave which will house the Prime Minister's.
Prime Minister's, yes.
Office in residence, yeah.
Right, sir. Right, sir. Sir, I also want some closing order backlog for a few projects. So if I may ask, can you just for this Bihar project, the Chapra and the Nalanda, what is the outstanding order backlog?
We have those details. Yeah.
Sir, is it good?
We're just going to, yeah, Sadhvi, we're just going to give them to you.
Yeah.
Bihar, Chapra. Bihar.
Chapra and Nalanda.
Chapra is remaining working INR 226 crores out of INR 5 crores.
Nalanda?
Nalanda, this is INR 172 crores. Just total order book, INR 383 crores.
GNK Ames?
Which?
GNK Ames, Jammu Ames.
Jammu Ames.
Jammu Ames, sorry.
This is INR 1,017 crores against INR 125 crores.
On this, sir, 250-bed hospital, specialized hospital in Hamirpur, then the Sion Hospital, then the MMRDA, Mandale, a depot architectural project, and the construction of high-rise complex in Sion. So you can share the same, sir?
Hamirpur, INR 243 crores against INR 323 crores.
243. Okay.
Balance, approximately, this is INR 519 crore against INR 533 crore.
Mm-hmm.
And.
MMIDA project, Mandale depot?
MMIDA. MMIDA, this is INR 474 crores against INR 534 crores.
And this,
That one. That one is INR 298 crore against INR 309 crore.
298. Okay. Sir, any other project, larger project, which is missing because, sir, the problem is we don't have the order backlog figures for the last couple of quarters, three quarters where the presentations were not available. So, no, if it is.
No, we will if you can.
We will make these presentations available to you now. You know, our IR team will, if you could reach out to Sadhvi.
Sir. Okay.
And Sadhvi, and then we will have a dedicated IR contact person, alongside Sadhvi, who will now start interacting with all of you again.
Sir, is any enhancement there? Is still the same only, huh? So there is no changing that project, right?
Yeah, yeah. That, that I think if you heard my earlier comment.
Yeah, yeah, yeah. You have said. Yeah, I heard that. And sir, the other two projects which you had received the Infosys campus project and the.
Started.
Kolkata New Town?
Infosys has started. It is underway. In fact, that order value has been yeah, in fact, they're increasing their area a bit. And, you know, let me just also clarify on the Z1 project. Z1 project, their approvals were stalled, but last month, their approvals came. So now that project has also started, with full intensity.
Okay. And so the Infosys, what would be the size? Because I know it's a very small INR 58-59 crore project, but the new size would be.
At the moment, the order that order value now would be about, I think, INR 65 crore.
That Kolkata affordable housing project which you had received INR 229 crore, what is the status out there?
That also, you know, the notice to proceed we have received 15 days ago because they did not have airport clearance from AAI because that is in Rajarhat. It was in that funnel. So that also, they've got 15 days ago, and that project is now started. We've broken ground.
That is still INR 229 crore only, that, at this point?
Yes. Right. Yeah.
So, in terms of now, sir, as you said, the collection efficiency has improved, but working capital is still remain expected to remain high. So, sir, how are we trying to bring down the collection efficiency? What kind of measures we have taken to bring to improve the collection efficiency and bring down the working capital going forward, which you said in the from FY23 likely to happen? So what measures are we expected to take, you know, or just a normal course of business?
Look, we've tightened our belt. We started this two years ago when the pandemic hit. So we're going to continue with the same. It's not that we're going to become lax. And as I said, you know, 45% of our audience is healthcare, where and government. So, the client, there seems to be no paucity of funds. So all we have to do is execute, execute with efficiency, and the funding will happen because the central government as well as the state government, where they're doing these projects, they are extremely keen on, for political reasons as well as for obvious reasons because of pandemic and whatever has transpired in the last two years. They want these projects to be up and running, right? So.
Bihar project also, sir, we can see if the collection will improve now as the project has kickstarted?
Yes. What has happened in Bihar and Bengal, and as I said, the government coming out of it because the pandemic is waning, you know, there. The treasury, the state government had directed the treasury to focus the funding on corona fighting measures, right? That is why now that is behind us. We know it for a fact now, as I said, for the auditorium project, Millon Mela project. The last month, we've seen the money started rolling in.
Mm-hmm.
The focus of the governments here has now shifted back to other development activities.
Sir, can we assume that you can win more projects from NBCC going forward or in the West Bengal region in Kolkata as things have improved now? Any thought on that? Just thought I want to know, like, because you are doing a lot of NBCC projects in the past also.
Yes, we were doing. And over the last 8-9 months, we had deliberately stopped bidding aggressively for NBCC projects. Now, these one of the projects that the residential project that I mentioned is an NBCC project. It's a large project, yes, Sarojini Nagar. So, you know, we were in talk with NBCC top management. We wanted certain changes in the commercial conditions. They have been kind enough to accommodate us. It was not only us. Other large bidders also wanted with us. Yes. So we, going forward, are going to bid for NBCC projects. As far as Calcutta is concerned, as far as Calcutta or Bengal is concerned, I don't think there are any large NBCC projects coming there. But we see renewed activity from the state government for healthcare projects and other institutional projects there.
Okay. So basically, Jaipur is an Ames project, if I may ask you?
It's not an Ames project. It's a SMS hospital. So why Sawai Man Singh Hospital? It's a government hospital. The state PWD has called the tenders, and there have been four bids.
This one commercial project which you said is also a government project, or which you are planning which you have?
You can call it a semi-government project. I'll tell you. It's the India Expo Mart, which we had constructed. It's in Greater Noida, where it's a convention center and an Expo Mart which we had built many, many years ago. They're coming up with an expansion. So there are 3 bids, to my knowledge, which have been received. 3 large ones: L&T Shapoorji, oh, sorry, Nagarjuna Shapoorji and us. So yeah, that we don't know the status of that bid because, in all probabilities, they will open it privately.
But these are all this will be, like, more of a competitive intensity, and that challenge will remain, like, for these projects?
That challenge will remain. But hopefully, as there are three large bidders, so the intensity, we expect, and we have seen also now, at least in the top four, five, companies, you know, there seems to be greater discipline.
Got it, sir. Okay. So hope you win any of these in the future, and we can see a good pipeline going forward, and we see a little thank you, sir, and all the best.
Thank you. Thank you so much.
Thank you. We'll move on to the next question. That is from the line of Prem Khurana from Anand Rati. Please go ahead.
Yeah, thank you for taking my questions, sir, and congratulations. Very good, sir, members. Most of my questions have already been answered. So just clarifications, mostly from my side. So to begin with, I mean, eventually, when you when you spoke about Calcutta, I think you said you could also look at developing on this land parcel. I mean, if you could clarify, I mean, when you say, I mean, you're planning to do a development, I mean, would you like to do it on your own, or you could also consider a JDA so that your scope is only right kind of providing the land and the marketing or the other part other stuff that is kind of required to kind of have real estate projects up, would be with a partner because they would be more kind of keen to the way they real estate operates.
Prem, all the options are open. As I said, whatever gives maximum returns, whatever model gives maximum returns to us, we will follow that. Our first preference would still be to dispose of the land and get the money back into our balance sheet. But it all depends on the kind of returns, you know, whichever model gives us the most. We are open for tying up with a local developer. We work with most of them. And the last option would can still be, you know, just developing because construction expertise exists, just developing the land and then, you know, marketing it ourselves. That is the last option.
Sure. If I understand, Jammu Ames, I think initially, we were facing some issues, and it started moving good. Like, how's the status now? I mean, is it moving good, or do you still see some scope, I mean, in terms of where it could move even better?
Yes. It can, it's picked up speed, but it will. We expect it to move even better in the next starting March. We expect it to pick up further speed.
Sure. And can you comment on the monthly billing run rate that you are expecting? I mean, what is it now, and where do you see it go? I mean, in, let's say, in FY23?
Specifically at Ames?
Yes, sir. Ames.
We are doing a billing of about INR 30 crore, and we expect it to be ramped up in the next financial year to about INR 45 crore-INR 50 crore.
Sure. Okay. Sadhvi, so just on clarification, I think you said cash balance is around INR 170-odd crore, but when I look at our balance sheet for, let's say, I mean, Q2 end or September end, cash and bank together was almost around INR 345. So how do you explain this drop, or is it only, I mean, the cash number that is given as the bank balance except it?
It is cash and bank balance, sir? You're asking?
Yeah. Yes, yes.
This is INR 172 crore as on 31st December.
Okay. So this is only cash, right? Because when I look at the first half balance sheet, cash and bank balance put together was almost around INR 345. So I'm not sure, I mean, how did this I mean, because I mean, when you when you gave working capital number, working capital number has kind of contracted, I mean, from 92 orders to 89. So eventually, I mean, there should have been some improvement, but the cash number seems to be lower than what you had given us, I mean, last time. I mean, from INR 345, it seems to have come down to this one payment too. So how do I reconcile this?
So, what is happening here, there is a cash and bank balances you are asking that is INR 245 crores last quarter as of 30th September. That's down to INR 172 crores. But basically, what is your bank balances? Another schedule is that 17 number. This was 123 crores as of 30th September, but now it's 192 crores.
Oh, okay. So that is.
Calculating you will work out that would be increased of around INR 30 crore.
Yeah, yeah, yeah. Sure. That's clear to us. Thank you. And all the very best for the future. Thank you. Thanks for that, sir.
Thank you. The next question is from the line of Rohit Balakrishnan from iThought PMS. Please go ahead.
Hello. Sir, am I audible?
Yes, you are. Yes.
Okay. Congratulations on the good numbers, sir. Sir, just wanted to—I mean, I think in one of the earlier questions, on the question of all the inflow, where you alluded to the fact that next year or no, you'll conservatively at least backfill your execution. That you do. So I just wanted to understand you. You in your past phone call mentioned that there is a fair bit of competition, and you are sort of not really going aggressive. So what you're saying for the next year or no, probably you'll increase your order inflow. Will it increase? So is there anything changing that you're seeing from the competitive positioning, or what is making you comfortable to sort of bid more and increase your pipelines?
So two things. One of the things I mentioned that, you know, the, the size of the orders or the size of the tenders coming, we are seeing an increase, right, which means that in some of the jobs, the larger-scale jobs, we expect the competitive intensity to be lesser, and the competition, because, as I mentioned, would be amongst the top four, five, six companies, who have now started bidding in a more disciplined fashion. So that is one. Second, what we are also seeing is that, the mid-level players who have bid indiscriminately, they have burnt their fingers, especially with the volatility in the prices in the commodity prices. So we expect even in that segment, more discipline to be there. That is why we, we had kind of been very conservative in the last six months of this financial year.
We expect going forward, you know, even with this conservative approach, sorry, we are slated to end the year with about INR 2,000 crore of new orders. So next year, we are targeting about INR 2,500 crore. So we feel that that should be achieved, and the margins will be better.
Perfect. Well, that's very helpful. Thank you very much, sir. I'm so much.
Thank you.
Thank you. We'll move on to the next question. That is from the line of Parvez Qazi from Edelweiss Securities. Please go ahead
Yeah. Hi. Thank you for taking my follow-up questions. So just wanted two data points from Sadhvi, sir. One is, what would be your average cost of warrants currently? And second is, what would be your gross debt level? Thank you.
What question, sir? What?
Cost of warrants.
Cost of warrants.
Cost of.
7, 7%, 7.1% approximately. The debt is 20.32%.
Gross debt is 0.
20.32%.
Good, sir. Thank you.
Thank you. We'll move on to the next question. That is from the line of Neet Parikh from Anand Rathi. Please go ahead.
Yeah. Thank you, sir. Thank you, sir, for the opportunity. Sir, in the mobilization, advance, how much is interest bearing?
How much is interest bearing? Is that your mobilization, or what? Most of it is Sadhvi, this gentleman, he would be accurate figure, but most of it is interest bearing.
Okay. Okay, sir. One more thing. How much more mobilization advance is expected?
We are not looking to utilize the full quota of mobilization advance that we can avail. So as far as the Bihar project is concerned, which is about to begin, at the most, we will take about 5% of the advance, though the tender provides for 10%. And in the long run, you know, the company, the management is actively working, to look at what to operate projects from internal approvals. It is only the pandemic which, you know, during the pandemic, we started taking advances again. But we expect that in two years from now, if all things remain normal, we would, we would not be dependent on mobilization advance from clients.
Okay. Thank you so much, sir, for the answer. And that, that is from my side.
Thank you.
Thank you. A reminder to the participants, anyone wishing to ask a question, may please press star and one. Participants, if you wish to ask a question, you may please press star and one. Is there any further questions? I now hand the conference over to the management for the closing comments.
Yeah. Thank you so much, everybody, for joining in. So, I think, if there are any follow-up questions, please feel free to reach out to Sadhvi. Our IR cell will answer those questions. I hope to talk to you again soon. We hope to talk to you again soon, with, when our financial results for the entire year are released, in about 2 months' time. Thank you. Thank you so much.
Thank you. Sadhvi from Jenison on behalf of Ambit Capital Private Limited. That concludes this conference call. We thank you for joining us. You may now disconnect your lines. Thank you.