Ladies and gentlemen, good day and welcome to the Transformers and Rectifiers (India) Limited Q2 and H1 FY 2027 earnings conference call. 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 this conference call, please signal an operator by pressing star then zero on your touch-tone phone. Please note that this conference is being recorded. I now hand the conference call over to Ms. Krishna Patel from EY. Thank you and over to you, ma'am.
Thank you, [Ikra], and good evening, everyone. A warm welcome to all participants joining the Q2 FY 2027 and H1 FY 2027 earnings conference call of Transformers and Rectifiers (India) Limited. Joining us today from the management team are Mr. Satyen Mamtora, the Managing Director and CEO, and Mr. Mehul Shah, the Chief Financial Officer, who will discuss the company's operational financial performance for the quarter and half year and address your questions thereafter. Before we begin, I would like to remind you that certain statements made during this call may constitute forward-looking statements. These statements are based on management's current expectations and are subject to risks and uncertainties that could cause actual results to differ from those expressed or implied. With that, I would like to hand over the call to Mr. Satyen Mamtora, the Managing Director, CEO, for his opening remarks. Over to you, sir.
Thank you, Krishna. Good evening, everyone, and thank you for joining us today to discuss the performance of Transformers and Rectifiers (India) Limited for the second quarter of FY 2027. Q2 FY 2027 performance reflects better execution, improved capacity utilization, and operating leverage across manufacturing facilities. As of 30th September 2026, our unexecuted order book stood at INR 7,237 crores, up by 32% year-on-year, providing strong revenue visibility over the medium term. The order book is executable over the next 18-24 months. During Q2 FY 2027, we received order inflow of INR 1,169 crores, 97% year-on-year growth over low base of last year this time.
Major orders received during this quarter were first ever order of nuclear power sector supplying generator transformers for NPCIL Kaiga Units 5 and 6, marking the strategic entry into high level infrastructure and high-value infrastructure segment. Received large transformer order from Megha Engineering and Infrastructures Limited in August 2026, with execution scheduled over next 35 months. Received LOI from APTRANSCO in August 2026 for power transformers manufacturing, with deliveries planned within next 17 months. Won a large order from Damodar Valley Corporation in October 2026 for manufacturing and supplying 500 MVA and 200 MVA transformers to be executed in the next 15-28 months. Secured a large order from GETCO in October 2026 for 80 MVA reactors and 125 MVA reactors and 500 MVA autotransformers, with the delivery scheduled of next 24-30 months.
This demonstrates the breadth of our capabilities across large power transformers, autotransformers, and shunt reactors. We currently have INR 21,000 crores of inquiries under negotiation, of which 80% is domestic orders and 20% export orders, with an equal mix between the government and private customers with utilities and industrial customers. Other quarter updates. During the quarter, we successfully completed dynamic short-circuit on three transformers, a significant technical milestone that values our products, our ability to withstand extreme electrical and mechanical stresses under fault conditions in accordance with the stringent international standards. Our ongoing transformer manufacturing expansion at Changodar is near completion, with the commercial production expected to commence around Diwali. The additional capacity will further strengthen our capability to execute our growing order book and support the next phase of the revenue growth. Backward integration projects are progressing as per timelines.
In September 2026, we established a subsidiary in U.K. to strengthen our customer support and expand our presence in the U.K. and European markets. Over time, we plan to develop a local assembly and sales capability with the potential to evolve this operation into a manufacturing base serving the region. Following our Q2 performance, we remain confident of achieving FY 2027 guidance and continue to remain on track with our growth plans for the full year. Our focus for the remainder of the year of FY 2027 will be on clear priorities, accelerating execution of our existing order book and ramping up expanded manufacturing capacities, progressing our backward integration initiatives and maintaining discipline and sustainable profitable growth. From an industry perspective, the underlying demand environment continues to remain supportive. India is witnessing a significant investment across power generation, transmission infrastructure.
Renewable energy integration and grid modernization, emerging areas such as data centers, railway electrification, even EV infrastructure and energy transition projects are creating additional sources of electricity demand and consequently, opportunities for the transformer industry. With our broad product portfolio, manufacturing capabilities, established customer relationships, and presence across more than 40 countries, TARIL is well-positioned to participate in the multi-year opportunity across domestic as well as international markets. With this, I hand over to Mr. Mehul Shah, our CFO, who will take our past financial performance regards and have Diwali greetings.
Thank you, sir. Good evening, everyone. I will take you through the financial performance of Transformers and Rectifiers Limited for the second quarter and the first half of financial year 2027. Let me begin with our standalone performance for the quarter. During Q2 FY 2027, revenue from operations stood at INR 709 crores, 66% year-on-year growth, and 27% quarter-on-quarter growth. Revenue growth during the quarter was supported by improved capacity utilization and execution. EBITDA for the quarter stood at INR 114 crores, 203% YoY, and 53% quarter-on-quarter growth. EBITDA margin improved to 16.1% compared to 8.8% in Q2 FY 2026, and 13.3% in Q1 FY 2027. This reflects the benefit of higher operating leverage and improved utilization levels during the quarter. Moving on our performance for the first half of the year. For H1 FY 2027, revenue from operations stood at INR 1,268 crore, a growth of 35% year-on-year.
EBITDA stood at INR 185 crore, 47% year-on-year growth, with the EBITDA margin improving to 14.6% from 13.4% in H1 FY 2026. Coming to the balance sheet, our leverage profile remained comfortable as of 30th September 2026. On a standalone basis, total debt stood at approximately INR 575 crore, comprising long-term borrowing of around INR 125 crore and short-term borrowings of around INR 449 crore. The debt-to-equity ratio stood at approximately 0.35x, reflecting a manageable leverage position as we scale operations and invest in future growth. Standalone cash and cash equivalents stood at approximately INR 77 crore as of 30th September 2026. In addition, the company continues to have access to other bank balances and unutilized QIP proceeds earmarks for its backward integration initiatives, providing funding flexibility for the plant capital expenditure program. Working capital remains a key area of focus.
As of 30th September 2026, standalone inventories stood at approximately INR 654 crore, while trade receivables stood at around INR 1,053 crore, out of which INR 825 is current and the rest is the non-current data. Net working capital days stood at around 154 days, comprising inventory days of approximately 93 days, receivable days of around 117 days, and payable days of approximately 56 days. The working capital cycle reflects the nature of the transformer business, which involves long manufacturing cycles, milestone-based billing, testing requirements, and project-linked customer approvals. We continue to focus on collection, inventory planning, and milestone execution to improve capital efficiency as the scale of operation increases.
To sum up, TARIL continues to operate from the position of financial strength. The growth in revenue and profitability during Q2 FY 2027 and H1 FY 2027, together with a manageable leverage profile, provides a sound foundation. Our financial priorities remain disciplined capital allocation, tighter working capital management, and the timely funding of capacity expansion and backward integration initiatives. Thank you. I now hand it over back to the moderator for the Q&A session.
Thank you very much, sir. We will now begin the question-and-answer session. Anyone who wishes to ask a question may press star and one on their touchtone 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 Harshit Sachdeva from Columbus Capital. Please go ahead.
Hi, am I audible?
Yes, you are audible.
Hi, sir. Good evening. Congratulations on the great set of numbers, sir. Really impressive. Sir, could you just elaborate a bit more on the Kaiga orders and the Megha Engineering order that you received, that's part one. Size and what are we supplying, and who did we compete against, or did they directly come to you? Second, sir, a new company, Kanohar, just got listed. Do we compete with them in any segment? So that's two questions, sir. Thank you.
Yeah. Sorry, I couldn't get your name. Can you please Hello?
Hello. Yes, sir. Am I audible?
Yeah. Your name, please? Again, sorry.
Sir, my name Harshit Sachdeva. I work at Columbus Capital.
Hi, Harshit. The NPCIL order for Kaiga project, we were competing with [inaudible] and other large transformer manufacturers. These are basically generator transformers for the nuclear power projects. As far as technology is concerned, yes, we do compete with them in the segments of 132 kV and 220 kV.
Okay. Sir, on the Kaiga order, any MVA or any order numbers that you could give? Is it repetitive in nature now that you are qualified?
Yes. This is repetitive in nature. These are generator transformers. NPCIL is putting a few more projects of nuclear power in India. Yes, this will be repetitive in nature, and the rating of the transformer is 400+ kV .
Okay. Sir, just last clarification. If, let us say, INR 100 crore nuclear plant, I am just throwing a random number there. What would be the value of the transformer components or the goods that we supply on any new greenfield nuclear project?
Greenfield nuclear new projects would be close to about 15%-18%—
Okay.
—the cost of the transformer.
Okay. Thank you, sir. Thank you for the clarification and best wishes for Diwali. Thank you, sir.
Thank you. Thank you, Harshit.
Thank you. Next question is from the line of Vignesh Iyer from Sequent Investments. Please go ahead.
Sir, congratulations on a great set of numbers. Just one question from my side. If you could share the mix of orders in terms of how much percentage of the total outstanding order book would be 400+ kV and less than 400 kV, if you could share the same.
Yes.
Can you share the number?
Yeah, please, go on with the numbers.
Yeah.
Sir, roughly we have around 55% of order, which is having a high voltage class. 55%-60% is a high voltage class, 400 kV and above.
Okay. What would that number be for quarter two of FY 2027 out of the total executed numbers?
So roughly we have executed around 56% of the power transformer in this quarter.
Right. Yeah, that's also fine. Thank you.
Okay. Thank you.
Thank you.
Thank you. Next question is from the line of Mihir Vyas from 9 Rays EquiResearch. Please go ahead.
Hello, am I audible?
Yes.
Yeah.
Hi. Thank you for the opportunity. I just wanted a clear clarification on our cash flow. Can you give some guidance from when can we expect positive free cash flow?
Yes.
Yeah. Currently, since we are into the stage of the capacity expansion as well as the backward integration, and we are targeting end of this financial year to start reducing our working capital cycle days, and that will give us positive cash flows.
What is the internal target of working capital cycle days, if you could share?
It could be roughly—
It should be below 120 days. We are trying to reach 120, and once we reach there, we would like to see close to about between 110 and 120 days this year.
Okay. Thank you.
Thank you.
Thank you. Next question is from the line of Yash Gupta from Asit Koticha Family Office. Please go ahead.
Yeah. Good evening, everyone. Sir, I just want to understand on the inventory, how the inventory is moving now. Earlier in last two quarters, we have purchased lot of inventories due to the pricing disruption due to war going on. How are the things looking right now?
Things are looking sort of similar right now. But as you are aware that we are putting our backward integration plans. Also we have enough inventory until this year, quarter three this year. So we are pretty much safely placed in terms of manufacturing and expansion of capacity utilization.
Is that the copper wires and all those things which we have purchased at a higher rate has been utilized and the billings and everything has been done? Or do you think maybe some impact will be there on margin in next FY 2028-FY 2029?
No, I don't think there should be any impact on the margins because FY 2028-FY 2029, we should have our own backward integration plant fully functional. So we will see a slight advantage there.
Okay, sir. How is the competition right— sorry?
Yeah, go on.
My next question is on the competition, how the competition intensity right now. Here we have seen a lot of competition intensity was there. How is this thing going on right now?
Like we said, that we have close to about INR 21,000 crores already in hand, or at least inquiries that are pending to be finalized. We are pretty much sure. The competition per se, I don't see there is a huge price war or lowering of margins by competitors. Everybody has enough orders in hand.
Okay. This 21,000 crores which you are talking about, on which bids have been placed?
Yeah. On which the bids have been placed. Inquiries are on, and they should be finalized in some time.
Okay. This INR 1,100 crores of order inflow in this quarter, is anything, any exceptional thing or do you think this will continue to flow in the next two quarters also for this year?
Yes, it will continue to flow. Like we have been saying before, we are trying to limit ourselves to unexecuted order book for not beyond 24 months or 28 months. We are trying to keep that in check.
Okay. This INR 7,000 crores will be booked in the next 18-24 months. Is this correct?
INR 7,000 crores will be billed, yeah. Will be billed in the next 18-24 months.
Okay, sure. Thank you, sir.
Thank you.
Thank you. Next question is from the line of Anubhav Mukherjee from Prescient Capital. Please go ahead.
Sir, just one question. There was a flare-up in prices of some of the key raw materials like transformer oil in the past quarter. How is the situation now?
There is a lot of echo in your voice. Can you please— it's not very clear.
Hello. Sir, is this better?
Yeah, this is better.
Sir, just one question. Sir, in the past quarter, there was a flare-up in prices of some of the key raw material like transformer oil, CRGO and all. How is the situation now sequentially?
Mehul, please answer.
Yeah. The prices, et cetera, are still on the higher side. But what we have, we have a majority of order which is having, say, a price variation clause. Mainly it does not affect our margin in a big way.
Okay. And sir, do we have some retention money for any orders we have?
Yeah.
Is that part of our balance sheet?
Yes.
Can you quantify that?
It is the retention money.
Okay.
Roughly, retention money is always there in the order. Roughly it is 5%-10%. It ranges from different customer, but it can be from 5%-10%.
And currently, what is the total amount?
I need to check, but roughly it would be around INR 200, say.
Get that. Thanks. I will get back on the queue.
Yeah.
Thank you. Next question is from the line of Deepak Poddar from Sapphire Capital. Please go ahead.
Yeah. Am I audible, sir?
Yeah, Deepak, you are audible.
Yeah. Thank you very much, sir, for this opportunity. Just first I wanted to understand, this Changodar expansion is expected to come next month. Just wanted to know what's the capacity there and what's the CapEx involved in this expansion?
The capacity is close to about 35,000 MVA. CapEx, Mehul, how much was the CapEx?
CapEx is around INR 150 odd crores.
INR 150 odd crores. This will take our total capacity to 75,000 MVA?
Yeah.
More than that.
Okay. What is the per MVA realization generally on an average? I understand it will be different for different type of transformers, but some average MVA per realization.
Mehul?
Yeah. It is different from, say, power transformer, distribution transformer. On an average, we will be realizing around INR 7 lakh per MVA.
INR 7 lakh per MVA. Okay, understood. That is very clear. Sir, just wanted to understand now your all backward integration plan is expected to get completed by first quarter, right? That would effectively mean on this expanded capacity, 80%-85% backward integration. Would that be a right understanding?
Yes.
Okay. Understood. Sir, what sort of value addition we can have in terms of cost benefit or percentage to revenue? What sort of benefit we expect once all this backward integration plan?
We are looking at around 100 basis point - 300 basis point margin expansion through this backward integration.
Mm-hmm. This will likely come by, what, second half of FY 2028 or FY 2029, this improvement?
You will see firstly it would cater the entire need of the TARIL and then to the third party. FY 2028 and then the FY 2029. It will gradually increase.
Okay. But the full effect will be seen by FY 2029?
Yes.
No. Yeah. Okay.
Okay. Understood. On your this year, we are talking about 25% kind of a growth with a PAT margin of 9%-10%, right? I mean, given the growth that we have done, I mean, are we being conservative here? Because we are already at PAT margin, I think, last two quarters, 11% +, right? We are still talking about 9%-10% PAT margin for the entire year. How should one look at?
Our target is to reach a growth of 25% and beyond. We are keeping our. It is the same.
Come again, sir. I didn't get you.
Our forecast is the same.
You kind of maintain the forecast that you have been saying, 9%-10% margin—
Yes.
—at 25% growth.
Yes.
Okay. I got it. I think that would be from my side. I would like to wish you all the best. Thank you so much.
Thank you. Happy Diwali.
Thank you. Next question is from the line of Vinil Shah from Dalal & Broacha. Please go ahead. Mr. Vinil, your line is unmuted.
Hello. Am I audible?
Yes, you are on.
Yes. So thank you for the opportunity and congratulations on a great set of numbers, sir. So I have two questions. First one is, if I could just get the proportion of exports in our order inflows and the revenues for Q2 FY 2027. Second was, if you could just give us some color about how much price rise has been taken in Q2 FY 2027.
Mehul?
Yeah. So in Q2 FY 2027, our export is around 8% of the total revenue. In the order book also, we have roughly around 15 odd percentages with export. Mainly this quarter, this margin expansion as well as revenue, which has come from the higher capacity utilization of the Moraiya plant. So margins, et cetera, is on the similar lines, what we have guided, around 16 odd percent of EBITDA.
And sir, any price rise we have taken over this Q2 FY 2027?
No.
What do you mean by price rise?
Since the raw material costs have risen, as a price taker practice, if we have passed on any cost to our customers.
Yes, the price variation is always every quarter it is a phenomenon. Every quarter, whatever we do the billing to the customer, we pass on the price variation also. This is not a one-time thing or anything. It is every quarter. Whichever billing we do, we also do the price variation billing also.
Yes, sir. Of course, I just wanted to understand that how much of the revenue growth can be attributed to the price rise.
Mehul?
7%-8%, yeah.
Okay. Thank you very much, sir. All the best and Happy Diwali.
Yeah. Thank you. Same to you. Happy Diwali.
Thank you. Next question is from the line of Dilip Pandey from ICICI Securities Limited. Please go ahead.
Hello, sir. Thank you for the opportunity. Just one question. Just want the production number for this quarter, MVA. Total production MVA.
I'm sorry. You're not very clear. Sorry, you're not very audible.
Mr. Pandey, may I request you to please repeat your question?
Yeah. Sir, I want the production number for this quarter. What is the production on MVA for the transformers?
It is roughly 9,500 MVA.
Okay. For this quarter.
Yes.
Yes.
Okay. Thank you so much, sir. Thank you.
Thank you. Next question is from the line of Jainam from Saltoro Investments. Please go ahead.
Congratulations on the great set of numbers. My question was on the CapEx that we are doing. Could you just help me understand Changodar plant's existing capacity was 12,000 MVA, and we added another 15,000 MVA, taking it to 35,000 MVA? Or was it in Moraiya? Because I am getting a little confused. Was it for medium voltage and renewable energy transformers, this capacity expansion?
Yeah. Changodar, the manufacturing capacity was up to 12,000 MVA.
Okay.
New manufacturing capacity at Changodar will be 35,000 MVA. Changodar will be producing distribution transformers, IDT transformers for renewable energy. Changodar will be producing small power transformers up to 132 kV, and Changodar shall be manufacturing large power transformers up to 220 kV. Apart from that—
Incrementally, sorry to interrupt you. Incrementally, 25,000 MVA is being added to the 12,000 MVA that we had, taking it to 35,000 MVA.
Yes.
Capacity, is that correct?
Yes, that is correct.
Okay. The extra high voltage transformer, 22,000 MVA that we were adding, that will be in the Moraiya facility, and that will be large power transformers. When will that come into production?
That will be EHV transformers.
Yeah.
Once we have finished this Changodar project, we will start working on the Moraiya plant.
When can we expect this? Just to get an idea.
Plus, what will happen with our insulation and the [inaudible] plant coming live, the manufacturing place for insulation, which was at Moraiya, will now be added to transformer manufacturing unit. We will be adding about 30% + manufacturing capacity at Moraiya.
Okay.
When this 30% should be immediately once our [inaudible] plant is functional. Apart from that, what to happen, it is going to happen once Changodar plant is completely finished.
Diwali, Changodar plant would be completely ready. Post that, we will look at Moraiya facility. FY 2028 onwards, is it safe to say that the EHV transformer plant would be ready for production?
Yes.
Am I audible?
Yeah.
Yes.
Yes.
Okay, understood. That is my first question. My second question is on the INR 1,000 crore big order that we received from PGCIL. Congratulations on that big order. What is the execution timeline, and what are the milestones given that it is one of the largest single source orders?
The execution timeline is about 24 months. 24 - 28 months. We should start commencing manufacturing, I think, December next year.
December next year. Okay, understood. I just wanted to get an idea of what sort of capacity utilization that we are looking at this year and the next year, FY 2027 and FY 2028, particularly FY 2028 once both the plants are live.
Ideally, I would want a capacity utilization of about 90%, and we are constantly working and we are constantly progressing towards that. But ideally, 90% capacity utilization is very good for a plant.
So will we achieve that in FY 2029, or are we confident of achieving that in FY 2028 itself?
We are working towards it. Maybe this year, maybe next year. We are constantly working towards it. Once our—
Got it.
—plants will be ready, we should be in a better place to understand how it is going.
Got it. One last question on data centers. How is the opportunity? What are the orders that you are seeing? Particularly in the U.S. export markets, are we in discussions with companies or utilities out there to provide our transformers? That would be very helpful if you could provide some color, both India and abroad.
Out of the 20% of the INR 21,000 crore inquiry, 20% is exports. Yes, we are looking at providing transformers within India and outside India. We have registered manufacturers on a lot of large data center facilities, so we have a presence there.
Got it. Congratulations and all the very best. Thank you.
Thank you. Happy Diwali to you.
Thank you. Ladies and gentlemen, in order to ensure that the management will be able to address questions from all the participants in the conference, please limit your questions to two per participant. Should you have a follow-up question, please rejoin the queue. We will take our next question from the line of Abhijeet Singh from Systematix Group. Please go ahead.
Yeah, thank you for the opportunity. My first question is, what is the impact of the disruption in the Middle East on our business in terms of imports or exports or raw material or any other impact that we are facing?
Mehul, please.
Yeah. Due to this disturbance in the Middle East, mainly our raw materials are not coming out from that route. There is no, as such, major impact. But yes, the timely availability of certain critical raw materials is still an issue that we are trying to figure out by keeping a large inventory. As we spoke, we already have a high number of inventory till our backward integration plants are in place.
Right. Sir, one thing I can observe is that we are guiding for 25% revenue growth for FY 2027, which means our H2 run rate of revenue growth is 20%. Which seems to be conservative given the order book, the plant coming online by Diwali. I just wanted to understand, is there any other factor which could be impacting our execution going forward? Because, after the plant is commissioned, I think we should be able to execute because we have a large order book. A substantial part of the order book was there even by Q4 of last year.
All the orders that we are getting currently are for beyond 12 months. Or not beyond 12 months also, they are beyond 18 months. So those is the executable in FY 2029.
2030, right?
Right.
I would like to order you on that.
I think I—[audio distortion]
I am sorry to interrupt, Satyen sir, we are losing your voice.
Sorry. I will remember at least I will answer.
Yeah. See, basically, can you just brief how you calculated that 20%, because even if we go by our guidance, et cetera, we still need to execute around INR 900 odd crores every quarter going forward.
That's right. Same calculation. So INR 1,800 odd crores you would require for H2, and then last year, H2 was about INR 1,300 odd crores. So 20% on that is INR 1,800.
INR 1,300 - INR 1,800 .
Anyways, INR 1,300 - INR 1,800.
Yeah.
Yeah, I think we are maintaining our INR 3,200 crores. So I think we are good at that.
Understood, sir. Second question is on the HVDC repair order that we had. We were doing some repair from PGCIL and even one transformer, and then we were about to enter into HVDC manufacturing. Could you update me on the progress of that? How is it coming along?
We have already started the processes of that.
[audio distortion]
Right.
Yeah. I just update. We are currently repairing the transformer. That will be another four to five months time. Then the successful running of that transformer will take another six to seven months, and then we will qualify for the manufacturing, and then we would start participating into the tender. At least one and a half year is away from when we are speaking.
Understood. So five months of operation at our end, then we will give them, then they will test it for six, seven months, and then we are qualified for commercial orders.
Yes.
Okay. Sir, lastly, on data centers, are we supplying into data centers already or is there a plan or is there no plan?
If you ask, we are already a regular supplier to a lot of large data centers in India and abroad. We are constantly manufacturing transformers for data centers.
Understood, sir. Thank you for answering the questions. I will come back.
Thank you.
Thank you.
Ma'am, can we take the last few questions?
All right, sure. Next question is from the line of Divyam Sandeep Sureka from Nuvama. Please go ahead.
Good evening, team, and thank you for the opportunity. Am I audible?
Yes, you are audible.
Yes. I had just one question. My question is on the short-circuit test. We completed dynamic short-circuit testing for three transformers. Can you please help us with the type of these transformers and their kV ratings?
Divyam, could you speak a little bit slow? I could not understand what your question was.
Sure, no problem. We completed dynamic short-circuit testing for three transformers. Can you please help me with the type of these transformers, whether they are power transformers, autotransformers, and their kV rating in terms of 220 kV, 400 kV?
These are 400 kV autotransformers. Sorry. Autotransformer, power transformer, yes. 400 kV and 200 kV.
Got it, sir. And sir, who would be the customer? Is there any specific customer in mind that we need to target for these short-circuit test certification or there are general certifications that we need?
These are specific for specific customers or electricity boards mostly.
Okay, sir. Thank you.
Thank you. Next question is from the line of Vijay Bhasin from InCred Equities. Please go ahead.
Hi. Thank you for the opportunity. I just have one quick question. If I look at your presentation, slide nine, what is mentioned is the revenue potential of about INR 5,000 crores - INR 6,000 crores post the expansion. To one of the previous participants, what you mentioned is about INR 7 lakhs per MVA of realization. We also understand from the industry dynamics is power transformer being at INR 5 lakhs per MVA, distribution at about INR 10 lakhs per MVA, and within high voltage, we are seeing pricing power being driven by the limited supply dynamics. Just wanted to double-check if you are still maintaining the $1 billion of revenue guidance that you have been targeting for the past three to four quarters over the next two to three years.
Second, a follow-up on this is whether you can see any spillover to FY 2029, but let's say 2030, 2031, and whether that would be requiring further CapEx, either via QIP or FPO or debt raise that you would be funding. Because if I do the maths, at about 90% capacity utilization of 75,000 MVA, and let's say you're pricing at INR 7 lakh per MVA, your top line sort of is getting peaked at INR 5,000 crores in one single year. So I am not able to understand that. So that's my only question.
You are only taking transformer sales. We are also looking at bushing sales, gasket sales, CRGO sales. We are also looking at CTC sales, our tank manufacturing unit, which is going to be one of the largest in Asia. With all these sales adding up, we are pretty much sure we will reach 1 billion.
The timeline for this would be?
Mehul, please.
It will be late part of FY 2029 or early FY 2030.
Fair. Would you also be requiring—
A quarter here or there, but we are very much well-placed, and we are very much aggressive in reaching that target.
Sure. Would you also be requiring further funding for this?
No. Mehul?
No. Because we are already doing this capacity expansion, backward integration projects, funding, et cetera, is already well planned. So, no additional CapEx.
Okay. The reason to ask that was, given your stretched working capital days, your PAT to OCF conversion is slightly subdued to whether if I compare with the high voltage peer group. So that's fair. Thank you so much.
Yeah. Thank you.
Thank you. Next question is from the line of Shrinarayan Mishra from Baroda BNP Paribas AMC. Please go ahead.
Hi. Thanks for the opportunity. I just wanted to understand if we are executing any BESS transformer orders currently, and if so, how is the pipeline for BESS transformers looking like?
No, we are not currently executing any BESS pipeline. But yes, there are inquiries that are currently ongoing, and we are sure that in this quarter we should get some orders for BESS transformers.
How big that market is, sir? Any assessment if you have done?
It is pretty much a new market for us where we are trying to assess the market.
Okay. The second question is, sir, on the CTC backward integration plant that was expected to be operational by 2Q. Is that running now? Did we see some cost savings from 2Q?
The plant will be— Mehul, please go on.
Yes. The plant will be operational from next quarter onwards, and it will take some time to stabilize, et cetera. From next financial year, we will start seeing some margin expansion coming from the backward integration projects.
I think CTC last quarter you guided for 2Q FY 2027 commencement. Now you are delaying it by six months.
No, we are not delaying.
[crosstalk]
[crosstalk]
In Q3, before Diwali, the plant will be commissioned. Currently, the plant and machinery is being installed. By Diwali, the plant will be commissioned. In November and then December, we will do the first trial runs. By quarter four this year, we should be commercially manufacturing CTC. This CTC will be only for TARIL transformers currently. From Q1 next year, we will see sales in the market also from the CTC plant of TARIL.
3,000 MTPA is the capacity. Of that, how much would be consumed captively?
Around 60% is captive.
Okay, got it. Great. Thanks. Thanks for answering.
Thank you.
Thank you. We will take the last question from the line of Sanjeev Zarbade from Antique Stock Broking Limited. Please go ahead.
Yes, sir. Thanks for taking the question and [audio distortion]
I am so sorry to interrupt. Can you speak a little louder, please?
Hello?
Now you can go ahead, please.
Sir, can you share the capacities of the various backward integration initiatives you have said you have embarked on? You said about CTC, about bushings, tanks, and regulators. What could be the capacity?
It is already available on the investor presentation that we have uploaded. On slide number— I will just give the slide number also.
Right. Other expenditures despite—
I am so sorry to interrupt, Sanjeev. We are not able to hear you properly. If you are using any external device, may I request you to kindly use your handset mode, please.
Yeah, sure. Sir, the other expenditures have been largely static on a year-on-year basis, despite the significant increase in the revenue. What is the nature regarding the expenditure, and would it be in the same range as the Pacifica range?
Yeah, it would be in the same range because it is a multiple ledgers that is there into the other items, mainly like freight, then the traveling, rent, et cetera. Then the foreign exchange gain loss, et cetera. That is there into other expense. It will mainly remain in that range.
And sir, regarding the HVDC transformers. Normally we have seen that the HVDC equipment packages have gone to Hitachi and GE Vernova. They are also doing, apart from the converter transformers, there is a lot of power electronics that is involved. What would be our strategy? Because if, let's say, GE gets the HVDC package, the converter transformer will also come from them only. Where do we stand so far as the HVDC converter transformers concerned?
We are also in the process of getting the converter transformers approved also. I think within the next 18 months, we will be fully being able to do the HVDC converter transformers.
Okay. Okay, sir. That is it from my side. All the best. Thank you.
Thank you.
Thank you. Ladies and gentlemen, that concludes our question-and-answer session. I now hand it back to the management for closing comments.
Yeah. Thank you all for joining us today and for your active participation in the earnings conference call. We sincerely appreciate the continued trust, confidence and support of our shareholders, investors, analysts and other stakeholders. We hope we have been able to address your key questions and provide a clear perspective on TARIL's performance, growth plan and outlook for FY 2027. Our focus remains on disciplined execution, timely delivery of commitments and creating long-term value for all stakeholders. Should you have any further queries, please feel free to reach out to our Investor Relations Advisor, Ernst & Young, who will be happy to coordinate with us and assist you offline. Thank you all and happy Diwali to all.
Thank you, everybody. Happy Diwali to all and see you at a better quarter next quarter.
Thank you very much. On behalf of Transformers and Rectifiers (India) Limited, that concludes this conference. Thank you all for joining us today and you may now disconnect your lines.
Thank you.