Ladies and gentlemen, good morning, and welcome to the TD Power Systems Limited Q4 FY 2025 earnings conference call. This conference call may contain forward-looking statements about the company, which are based on the beliefs, opinions, and expectation of the company as on date of this call. These statements are not the guarantees of future performance and involve risks and uncertainties that are difficult to predict. As a reminder, all participant lines will remain 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 the operator by pressing star then zero on your touchtone telephone. Please note that this conference is being recorded. I now hand the conference over to Mr. Nikhil Kumar, Managing Director. Thank you, and over to you, sir. Nikhil sir, please go ahead.
Ladies and gentlemen, please stay connected while I go ahead and rejoin Nikhil sir. Thank you. Ladies and gentlemen, due to technical issues, Nikhil sir will connect shortly. For now, we have Varalakshmi ma'am. Please go ahead.
Good morning, everyone. Thank you once again for joining us today on our earnings call. I trust all of you would have received our results and investor presentation. I would like to discuss with you TDPS financial performance for the year ended 31st March 2025. Moving on to the financial performance for the 12 months ended 31st March 2025. On standalone basis, our full year in total income on standalone basis was INR 12.88 billion versus INR 10.07 billion over the same period previous year, increase of 28%. EBITDA for the full year is 17.46%, including other income, excluding exceptional and treasury income, versus 17.59% over the same period previous year. Profit after tax and comprehensive income is INR 1,530 million versus profit of INR 1,223 million same period previous year, an increase of 25%.
During the year, the company has provided for diminution in the value of investment of INR 30 million, being 50% of its investment in its subsidiary, DF Power Systems Private Limited. Order book. Order book of manufacturing segment is INR 13.68 billion, INR 10.12 billion regular manufacturing business, INR 3.16 billion railway business, space and aftermarket INR 0.11 billion and INR 0.29 billion turnkey business. Exports and deemed export excluding railway order is 62%. Order inflow statistics. Order inflow for the quarter is INR 4.13 billion, highest ever since inception of our company. Order inflow has increased 43% Q-to-Q basis and 41% over a YoY comparison basis. Current year order book is INR 14.79 billion, previous year order book INR 10.51 billion. 68% of our quarterly order inflow is exports, while 32% is domestic.
Domestic order inflow for the last four quarters have been 28%, 27%, 32% and 40%, which is INR 81 crore, INR 96 crore, INR 130 crore, and INR 153 crore, respectively. Order inflow from deemed and direct export is INR 9.85 billion compared to INR 5.9 billion previous year. Export and deemed export order inflow is 68% of total order. On a consolidated basis. Our total income on consolidated basis is INR 13.02 billion versus INR 10.17 billion, an increase of 28%. Profit after tax and other comprehensive income for the year is INR 1.734 billion versus INR 1.156 billion, increase of 50%. We continue to maintain a strong cash position of INR 1.99 billion. Order book, market situation, and guidance. Market condition. The order inflow continues to be very strong from exports in our generator and motor business.
We give our initial guidance at INR 1,500 crore with a strong upward potential, given the sustained order inflow as well as the third plant commission coming on stream in H2 of this financial year. EBITDA margins will be in the range of 18%-18.25% with an upward movement potential. Market scenario. Domestic market. Looking at the entire year of FY 2025 versus FY 2024, the domestic part of order inflow has increased from INR 4.41 billion to INR 4.6 billion, 4% growth. However, the rate of growth has moderated and right now we are factoring in-
Varalakshmi.
-4% growth on.
I'm back on the call.
Okay. You'll take it forward, sir, from here or?
Yeah, I'll take it forward from here.
Okay.
I'm sorry, everybody. I think I got disconnected. The rate of growth in the domestic market is just 4%, and we are factoring in 4% growth in domestic market for this year also. The market in India is still a single-dimensional market with capital power plant business, so it depends on brownfield and greenfield private sector investment. Biomass and garbage burning plants are relatively underperforming in terms of potential versus actual. In the hydro market in India, we're expecting some large orders in the refurbishment sector. If these are successful, we can see double-digit growth for the domestic market, in terms of order inflow for FY 2026 to be excluded in FY 2027. For TDPS, it is the export business which is the main backbone of the business. International market. We have extremely strong growth in the order book and export business from gas turbines, engines, and motors.
Order inflow from direct and deemed exports has increased by INR 3.95 billion from INR 5.9 billion to INR 9.85 billion, which is 67% growth on a year-on-year basis. These numbers are a clear evidence of our business results. Exports will continue to be a growth driver for the future as we have many more applications which are our generators in the international market compared to India. We continue to win orders in gas engines and gas turbine generators. There is a huge growth in fracking, data centers, AI server farms, grid stabilization units, and of course Ukraine. The demand is simply huge and the market growth presents the company with the most exciting growth opportunities ever since its inception.
For example, the new German government has called for expedited installation of 20 GW of gas power only for grid stabilization. The recent blackout in Spain and Portugal has suddenly increased the awareness of grid stabilization and what can happen when the grid is overly dependent on renewable power. AI farms and data centers in the U.S. continue to be a huge market with massive requirements, and we are very well positioned with our OEM customers to be a part of this exciting growth. Coming to traction, we are on the way to deliver prototype units for Germany, U.S., and CIS countries. We have firm volume contracts for FY 2027, and we will see a sharp increase in this segment in FY 2027. Hydro, the order inflow continues to be strong and steady. The new mission business is all export.
As I mentioned earlier, there are a number of refurbishment jobs in the market in India, and we hope to win a few of them. In general, the export business is a key driver for our growth for generators with big orders in gas, hydro, and traction. We are participating and winning business in larger AI data farms, AI server farms, data centers. This year we'll put larger generators into the market, up to 40 MW, even 45 MW size. This segment of the market is equal to the in size compared to the market where we're currently operating in. This will open up a huge market potential for TDPS in FY 2027 and beyond. In the motor business, we are on track to achieve the numbers we indicated earlier.
Once again, our markets are mainly exports, and we see a big pipeline of orders in the Middle East and India. Turkey, we have received the orders from Turkey after a long pause in the market. We deliver the generators this year. It is certain the Turkish plant will deliver good numbers and profits for this year. However, the outlook for the Turkish market is very bleak, and this year could be the last year of operations in this market. As the company enters new markets and more complicated applications, there is a clear need for advanced talent to design new machines and meet the stringent requirements of new applications. TDPS is going to set up a design center in the U.K. Initially, with two or three highly qualified individuals who will be responsible for developing new generators and motor products for the future.
In conclusion, with the new plant and more opportunities coming our way, we are well-positioned to exceed our guidance of INR 15 billion for this year. We are also focused on FY 2027 and new products in large generators, large motors, and of course, execution of the traction motors for Europe, U.S., and the CIS countries, which will drive the company towards the INR 19 billion-INR 20 billion mark in FY 2027. This brings me to end my initial remarks. I'll be happy to address questions that you have. Sorry for the-
Thank you.
-break in the link of communication.
Ladies and gentlemen, we will now begin the question -and -answer session. Anyone who wishes to ask a question may press star one on their touch-tone telephone. If you wish to remove yourself from the question queue, you may press star two. Participants are requested to use their handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question comes from the line of Piyush Sevaldasani from Sundaram Alternates. Please go ahead.
Hi, sir. Thank you for the opportunity, and congrats for a great set of numbers. My first question is-
Thank you.
-on the margins. We have seen an improvement in the margins for this quarter. Can you help us understand on the cross margins, is this 36% sustainable? Also on the staff cost, which has been controlled really well. I was under the impression that we are hiring new people for the new plant, that's why there would be an increase. Is that incremental cost capitalized? That's why we are not seeing this.
No, who will capitalize staff cost? That is not at all our accounting policy. We are hiring people, that is mainly at the blue-collar level at the moment, we are not going to see big increases in the numbers immediately. The white-collar hiring will start now. Then we will start seeing some increases in the employee costs coming in this year. Coming to the gross contribution margin, in general, they've been delivering fairly consistent numbers for the past few quarters. It's sustainable in this range for sure. Of course, 1% here and there, it could vary from quarter to quarter, in general, we can say sustainable in this range.
Sure, sir. My second question is on the working capital. The net working capital days has seen an increase this year. That is leading to weak operating cash flow. How should we think about it going forward?
Yeah. We had to take certain very drastic decisions. For example, when the copper prices dropped recently, we purchased a lot of copper, and we also bought a lot of electrical steel because we saw prices were coming down. When the whole turmoil for duties and everything was Trump duties, Trump tariffs was in the market. We saw buying opportunities, so we have purchased a lot of material. We will see a big improvement in the operating cash flow starting from Q1 onwards. We will see, because we'll not be buying steel and copper, we'll be consuming from inventory. Second reason is that, of course, March is always a very heavy month for invoicing, so those will end up in receivables.
Collections are now taking place in Q1 and Q2, we'll see the cash flow improvement, cash flow numbers dramatically improving in Q1 and Q2. By the end of H1, we will show very good cash flow numbers where by the next quarter, we will tell you exactly what it's going to be for H1.
Sure. Sir, just last one question on other income. We have seen a sharp jump of INR 10 crore, if you can just help me on that.
Yeah, that is mainly foreign exchange gains. Varalakshmi, correct me, please. You can maybe take this question, please.
Yeah, it's foreign exchange gains.
Sure. Thank you, sir.
With foreign exchange gains, we had a lot of forward booking.
Sure. Thank you, sir.
Of course, we have been exploiting the opportunity which has been created with the euro. In the recent times, the euro had become very strong against the rupee, almost going up to INR 96, INR 97 levels. We could also get a benefit of that in Q4. We have exploited that opportunity with our forward rates and hedging. We will continue to take the benefit of this for this entire financial year. We have used that narrow window of time to book a large number of forwards with very favorable rates. The company will get solid foreign exchange gains coming from forward booking from the euro for this current entire financial year.
Okay. Thank you, sir.
Thank you. Ladies and gentlemen, in the interest of time and fairness to others, we request you to restrict to two questions per participant and rejoin the question queue. The next question comes from the line of Deepesh Agarwal from UTI AMC. Please go ahead.
Good morning and congratulations, Nikhil and team, for the good numbers. My first question is, Nikhil, if you can explain us what is the share of revenue coming from U.S., and what is your view of the potential impact of the tariffs after that 90 days pause?
I think that India is close to finalizing some kind of a trade deal with the U.S. I think that, first of all, I don't think that the whole world is going to get back to those huge duties, what Trump was initially proposing. Even if it does, for us, the U.S. market for our products are all outsourced from outside the U.S. There's no U.S. manufacturer making anything above something like maybe 10 MW - 12 MW. There's one person who's making up to about 12 MW, he's completely booked out. All the larger data centers, AI business, the machines are imported from Europe.
Sure.
As long as Europe and India have comparable tariff rates, I think that there's going to be no big advantage for one country versus the other. For the U.S. customer, there's going to not be a big advantage for buying from India or buying from Europe in terms of tariffs. Of course, if India is able to finalize a deal faster and we have lower tariff rates compared to Europe, we will see a big advantage for us, that will correspondingly result in more orders for the company. These are all highly uncertain things. They change from week to week. As far as our customers are concerned, they need to import generators. They know that they have to pay the import duties. It's not coming onto us. Demand is very strong.
Our OEM customers have started making all their contracts, passing on these import duties to the end user. They also aren't affected by this right now. Demand continues to be strong. I feel that TDPS will not be affected by this for the U.S. market at all.
Sure. In the opening remarks, you mentioned that you are setting up a design center in U.K. If you can throw some more light and need for it and what potential benefits it can bring for the company.
Yeah. Basically, for larger machines. As you know, we are developing our own design for larger machines up to 100 MW. These data center applications are also moving towards the larger sizes, where each unit could be 30 MW, 40 MW, or 50 MW in size. We need technology. We need to upgrade our technology levels quite significantly to be able to compete in this space. We need better talent. We have identified talent who can do this, and these people are located in the U.K. We have decided now to put up a design center over there. They're not only talented, not only very capable in the large generator space, they're also very capable in the large motor space. They can also help us in our current designs in optimizing the designs and optimizing weights, efficiencies, and things like that.
We'll also see benefits coming downstream for our products in terms of cost optimization. It's going to be, I would say, the potential of what we can do with these extremely talented people is quite large. We'll see big benefits coming into the company downstream with this design center.
Sure. Last question. What percentage of our revenues would be dependent on data centers and AI firms? In terms of your interaction with the customer, what is the commitment in continuing those investments? Are they concerned about the new tech impacting the future investments?
No. I don't think that. Right now, the market is completely on fire, and there's no slowing down. There is a fight for capacity. People who are putting up these data centers are fighting for capacity. They're booking up capacity from OEMs, like gas turbine manufacturers, gas engine manufacturers, generator manufacturers. That is the situation right now. Booking capacity for 2026, booking capacity for 2027. That is what is happening, and there's no signs of this slowing down. As the applications and the use of AI keeps getting more and more widespread, the demand for this power is getting more and more and more. As I said, plus grid stabilization, what happened in Spain and Portugal has really opened the eyes of people in Europe, especially what can happen when there's power in the grid.
Sure.
I'll tell you, it will be something like 25%.
25%. Okay. Thank you.
Thank you. The next question comes from the line of Mohit Kumar from ICICI Securities. Please go ahead.
Yes, sir. Good morning, and congratulations on a very good quarter and a fantastic year. My first question is, given where we are, what is our revenue guidance and ordering flow guidance for FY 2026 broad outlook?
I said INR 1,500 crore is the first guidance for FY 2026 with a strong upward potential to improve the numbers. We'll see based on the order inflows that we have with what we are seeing. Order inflow guidance will be something between the region of INR 1,600 crore-INR 1,700 crore for the year.
Understood, sir. My second question is, of course, you have just in the presentation mentioned that you have got 225 MW gas turbine generator order from data center. What is the timeline for delivery of this order? Are you working with only one OEM?
Delivery in the next 12 months.
Are you working only with one OEM? Is there a possibility of adding more OEM as you go forward?
There are only two, three OEMs in the world. There are only three big OEMs in the world who make these gas turbines. We are working with all three of them.
Okay, I understood, sir.
One of them is having a very large market share and the other two smaller amounts. The one that is having the largest market share is our most important customer, that is the customer from where we are getting the most amount of business.
My last question on domestic, I think you mentioned about hydro generators. I'm assuming these are all old machines. If the single generator could be a sizable order, maybe get us a 100 MW, or are these just smaller size generators?
Vinay, can you answer this question, please?
Yeah. Good morning. These are smaller size machines, what we call as small hydro, which is in the range of up to 35 MW. Not more than that.
Understood, sir. Thank you. All the best. Thank you.
Thank you. Ladies and gentlemen, we request you to restrict to two questions per participant. The next question comes from the line of Mythili Balakrishnan from Alchemy Capital Management. Please go ahead.
Thank you for the opportunity. A couple of questions. I wanted to get a sense from you of what is happening on the railway side. You had mentioned earlier that more than domestic, we are looking more at exports. Could you just elaborate a little bit on what are you seeing in terms of orders, and is there any traction there?
The domestic side is fairly dormant, let me say. I don't want to use the word dead, but fairly dormant. There's nothing new coming up in the domestic market. We have been focusing our attention on opportunities outside India. We are focusing on three opportunities, one in Europe, one in the U.S., and one in CIS countries. All three are active. We have contracts for all three. As I said, we'll be developing the prototypes this year. We have the orders for the prototypes, so they are being built right now. The volume production will start by about, I think by Q4. We should see the full revenues coming in next financial year.
Just to get a sense, these are prototypes which will then be tested?
Yes, we test it, put on the locomotives, and then they'll be tested.
What is the competition there? Is it done in-house by the OEMs currently, or is there someone else who's providing? If you could give us a little bit of an indication of the competitive landscape.
No. It's very limited. There's actually just one big competitor in this range which dominates the market. We want to take away. The market is also looking for a second player. I think that we are in the right place, right time. It's such a huge market and just one single player dominating the market. There's scope for us. All I can say is we are seeing big scope, but we need to have the right product in terms of being able to compete against the party who's there as a market leader, who's got an extremely good product, and we need to do some work to get there.
Got it. The last question is on the CapEx. Could you just help us with the timeline of when do you think this is coming on board for us and how to sort of think about it? You mentioned H2. Just to get a sense of some timeline from that. That's all from my side. Thank you.
By the end of this month, by end of May, we will start commissioning the first shed. Progressively, the second shed and third shed, all the equipment and everything, all the trials and everything will start. We are more or less on schedule. I said the production, when we see the impact on our numbers, we will start seeing that only towards H2.
Got it. That's all from my side.
It's installing machines and commissioning machines. The first shed has already started.
Got it. Thanks. That's all from my side. Thank you very much.
Thank you. The next question comes from the line of Ganesh ram from Unifi Capital. Please go ahead.
Thank you, Nikhil. Congratulations on a great set of numbers to the whole team. Most of my questions have been answered. Okay. Most of my questions have been answered, Nikhil, I was just trying to understand this thing in Turkey. The order inflows have improved, did I hear you right in saying that this would be the last year of operations in that market?
Most probably.
Okay. Could you just help me understand?
They've again changed the calculations for local content. Calculations have been changed once again. Of course, it will not be applicable for this order, but it will be applicable for future orders. I think it will be almost impossible for anyone to meet those new guidelines. The market itself is. There are no inquiries in the market. With these new guidelines, local production will become very expensive. Even with the incentives, it'll be cheaper for someone to buy an imported machine. It's quite senseless what's going on over there in terms of the regulations. Now it's being totally over-regulated. I don't see a future in locally made machines anymore. After we finish this order, we will consider just shutting down the plant.
Would there be?
There's no point in having any costs over there anymore.
No, I totally understand. Would there be any one-off impacts that come from it? That's the first part. Second thing is, in terms of if they're not making it locally, would it still be attractive for us to export there out of our manufacturing base here?
Yes. It'll be all imported machines as far as Turkey's concerned. We have a very strong market presence, very strong brand name in that country. Whatever gets imported probably will be still very competitive in the market. Varalakshmi, there'll be hardly any impact on the balance sheet, right? If we stop the plant over there.
Yeah, maybe around INR 3 crore- INR 4 crore the investments that we have done. We'll try to bring back them.
We have those reserves also, right? It'll get nullified.
Yeah.
Yes. Understood. That's very clear. The second thing is, I went through that exhaustive list and the hydro leap of orders, the nuclear orders. There's quite a lot happening for us, as we've been aware for some time. Right? Is there anything new this quarter that you think has come up that you haven't had previously that could scale quickly or is a very large addressable growing market beyond the AI data centers and server farms and motors?
It's asking for too much, right? This grid stabilization, I think, will become very large. What has happened in Europe, in Spain and Portugal, has really shocked everybody in the continent. All governments are now really looking at gas power to stabilize grids very seriously and are going to start. Of course, the problem is that once again, everyone is again competing for the same capacity for gas turbines and gas engines, which is completely oversold for the AI market in the U.S. That's the situation right now. There is a huge demand coming from grid stabilization units and AI for larger gas units, but there's no capacity.
The good thing, of course, we're right in the middle of all this, so we also are at risk. The demand situation is going to be very strong for foreseeable future because these are two fundamental things which are driving the demand, which is going to be sustainable for some time.
Yeah. Maybe just the last question from me is, on the targets, I just want to get a bit more nuanced here because I know there's a lot of moving parts. One thing I was asking is if U.S. is importing a lot of these generators from Europe, are they primarily importing this from the U.K., or is it from outside the U.K.? Because my understanding is they have a free trade agreement going on there. That's the first part. The second is, if the cost of importing these generators go in and even if the OEM is passing through these costs, how much is the effective impact for the demand? Is there going to be a second or third order impact on demand because of this?
The cost of the power unit or power plant from the overall data center or overall AI server farm is estimated to be something like 5%-6% of the total cost. If you take the cost of the servers, land, water, whatever, everything, all water systems, everything put together, it is something like 5%. So even if it goes up 20%, it is 1% of the overall cost. Nobody cares about it.
Yeah. Perfect. All right. Thank you so much, Nikhil.
Thank you.
Thank you. The next question comes from the line of V. P. Rajesh from Banyan Capital. Please go ahead.
Congratulations on a good set of numbers, Nikhil. Just two questions. One on the new plants, the third plant that you talked about.
Rajesh, I'm sorry to interrupt you there, but your audio's not clear.
Is it better now?
It's okay. Let him continue. Yeah, now I can hear. Yeah.
Okay.
I can hear. I can understand everything.
I was just saying, by March 2026, what kind of ramp-up can we expect? Will it be, let's say, closer to 80% or so, or will that happen in FY 2027?
It'll happen in FY 2027.
Okay. Secondly on the railway business, if you can just touch upon that, what has been the progress on that particular order?
I just spoke about it a few minutes ago, I'll repeat myself.
Sorry, I missed that.
Yeah. The railway business in India is fairly dormant. There's nothing much happening over there. We are focusing on three orders that we have, contracts that we have with Europe, U.S., and CIS. We are building prototypes this year. Testing will take place this year, and volume production will start by about Q4, the impact will be felt in FY 2027. These are something like three to three and a half year contracts that's starting from FY 2027.
Got it. Just one clarification, you said your business is now 25% because of the AI and data centers in the U.S. Is that the right way to understand it?
Approximately, it will end up being around that number, 20%-25%. It will end up being that number. If we penetrate with the larger machines in FY 2027 into that market, then this share could grow.
I see. Got it. Okay. Thank you and all the best.
Yeah.
Thank you. The next question comes from the line of Prolin Nandu from Edelweiss Public Alternatives. Please go ahead.
Yeah, Nikhil, I apologize if my questions are repetitive. I joined a bit late. My first question is on motors and the margins that you intend to own there. See, in generators, we have a very dominant position. We have been doing this for years. Motor relatively is a newer venture for us. How comfortable are we to earn, I'm not asking you the specific number, but to earn a similar margin in our motor business as well? That's my first question, Nikhil.
We are going after markets only where we can earn good margins in the motor business. We're not going after the market where the margins are bad, the market where the margins are bad is a huge market. We're not going after that market. We're going after the market where the margins are better. We will be in the market where we can deliver good margins.
Understood. My second question is this two tailwinds that you mentioned, one is the gas-based AI data centers in U.S., and what happened in Europe in terms of power shortage. If I think about to cater these two tailwinds, are we approaching these two tailwinds in a similar manner as we approach some of the other avenues of our revenue? Where I'm coming from is that, is it still part of the entire package of turbine and generator which go together, or the way to probably approach this market is slightly different than our traditional routes?
The way is the same. The prime mover companies, turbine manufacturers, engine companies will get the orders, we are tied up with them, and we will get some part of the business.
Okay. Understood. Can I just add one follow-on, if that's fine?
Yeah. Go ahead.
Yeah. Just to understand this whole blackout that happened in Spain and Portugal, and you mentioned that as a tailwind. Is it like a particular part of the grid which was not doing well and which was something related to, let's say, having some of the excess generator capacity at few places in the grid? Can we pinpoint as to what was wrong there, and whatever is the cause, is that the main reason for, let's say, tailwinds that you mentioned. Can you just give some more color on this aspect?
What happened was that there was a sudden drop in renewable production in the grid. Something like 4 GW or 5 GW came off the grid instantly because the wind stopped blowing, sun stopped shining in different parts of Spain and Portugal. That caused a complete outage because there was nothing that could come and replace that 5 GW of power instantly. Overall the grid everywhere, one by one by one, just collapsed.
Right. Nikhil, what's the? How do you?
This is a domino effect. This is such a domino effect that takes place when you have, say something like one part of the grid just completely collapses, the remaining part of the grid cannot meet the demand, that part of the grid gets overloaded, it's a domino effect that takes place. The only way is to make sure that you have gas power, which can come onto the grid very quickly to be able to fill in that gap when the renewable power comes off the grid.
Got your point, Nikhil. Thank you so much for that, all the very best.
Thank you.
Thank you. The next question comes from the line of Shyam Maheshwari from Aditya Birla Mutual Fund. Please go ahead.
Hi, Nikhil and team. Congratulations on a brilliant set of results.
Hello, Shyam.
Just a couple of questions from my side. Firstly, on the domestic inflows. While you're mentioning that the market looks to be a little dormant, this quarter we have shown our best inflows for nine quarters, the last nine quarters. This is coming in conjunction with probably Triveni reporting an inflow decline this quarter, except the large order that they got. Was very curious to understand how we have been able to deliver 40% growth in domestic inflows this quarter. Was there a one-off large order here or is it largely steam turbine, right?
Well, we also got some orders from the domestic market for large two-pole generators. That is also included. Some 80 MW- 90 MW machines. That is not in the range that Triveni operates in.
Okay.
They do, but I think they didn't get these orders. That adds to our numbers. We got a couple of motor orders from Nuclear Power Corporation, in Q4. That is also added to domestic. If you take the generator sizes below 50 MW, or if you split this domestic order book into. There is a lot of background noise coming from you, Shyam. If you could just please silence it, that would be appreciated. Yeah. If you take the domestic market only for the steam generators below 50 MW, I think our numbers would be following the trend what Triveni is reporting.
Interesting. Secondly, on the export side, obviously gas turbine has been a big vector of growth for us. I wanted to understand what would be our current market share. You mentioned there are limited players here. What would be our current market share.
In which one? In which segment? Sorry, which segment?
Gas turbine generators.
Very small. Less than 3%.
Of the global market share?
Mm-hmm.
Okay. That probably with these machines of 240 MW that we're trying to introduce, that should ideally inch up over the next few years.
Yeah. We have big plans. We have a lot of new products for the gas turbine market, which we'll be bringing in this year. We also have a new OEM, which we have signed up. We're also getting new orders from the new OEM. This year, we will be putting a lot of machines into the gas turbine business up to 25 MW. Also putting in the trial orders, trial machines for the 40 MW-45 MW. The demand that I said is extraordinarily huge. The opportunity size is extraordinarily huge. There's a lot of pressure on us also coming from our OEM customers to move faster. They want everything yesterday.
There's also big opportunities coming from the gas engine side, where once again, there's some new products which are being developed exclusively for the data center market by our engine customers with big gigawatt size order commitments, where we are the chosen generator manufacturer, which will start coming in onstream October, November, December this year and going well into next financial year. That's why we are very upbeat about revising our guidance upwards. We are extremely upbeat about it. Vinay will be happy to report better numbers when next quarter we will talk. Once we see all these things gel together and come to the point where we can announce it to all of you. The way things are going, it will gel together. Unless the earthquake or something like that, or some asteroid hits the Earth. It's really going gangbusters right now.
Perfect. That's wonderful to hear, Nikhil. All the best for the year ahead.
Yeah. Thank you.
Thank you. The next question comes from the line of Aman from Stallion Asset. Please go ahead.
Hi, sir. I hope I'm audible.
Yes, Aman, you are audible.
Yeah. Sir, I request you, can you please give some more color on the domestic side of our business, what kind of headwinds we have been facing, challenges, and what the customer behavior there, and what is the sign we can track in order to see some recovery on that side?
We are a fairly well-entrenched player on the domestic side. We have two major customers to whom we deliver our steam turbine generators. We have longstanding relationships with both of them. When the market turns and when the market picks up, they will get the business and we will correspondingly get the business. It is practically impossible for any one of us, all of us who are in this call who track the domestic market, for us, any one of us on this call to predict or to say what's going to happen in the next six months, next one year with the domestic market. I don't have a better insight compared to all of you who are looking at indicators day in, day out and who are in the market day in, day out on the domestic side.
I think you guys are the better experts compared to me. What I see is I see something like a conservative growth in the domestic market, which we have factored into the business plan. Of course, if things get better, we'll be happy to, and that business will then come to us, we'll be happy to deliver to the domestic market. At the moment, I'm being realistic about where we are.
Understood, sir. Sir, just one last question on the number side to just understand. Sir, historically, for the last four, five years, we have been executing around 60%-70% of the order book, which we have on the annual basis. Last year on INR 1,189 crore of order book, you closed this year around INR 1,278 crore. Which is around 110% execution on the order book. Currently as well, you are guiding around INR 1,500 crore of revenue on INR 1,368 crore of order book, roughly. Which is again 110% of execution on the order book. Am I missing on something which is not recorded in this book and how is this number and understand?
I think your analysis is really good. That's realistic what you're looking at. That's what we have performed in the past, and that's a trend for the future. The upside potential will come based on whatever I spoke about earlier on this call. We are confident that we have products, new products, new applications, which will then give us the opportunity to exceed the guidance, whatever we talked about.
Got it, sir.
In general, your analysis is correct, and this is something that we also do internally just to say that you're on a good analysis. This is something we also do when we do our analysis. Order book versus achievement and looking at the past five years and looking at the numbers. Yes, we also do the same thing.
Got it, sir. Understood. This trend is going to continue going ahead as well. I just wanted to understand.
Yeah. Correct. Yes, absolutely.
Yeah, sir. Understood. Thank you so much. All the best for the future, sir.
Yeah, thanks.
Thank you. We take the next question from the line of Himanshu Upadhyay from BugleRock Capital Private Limited. Please go ahead.
Yeah, hi. Good morning.
Good morning.
My first question was on receivables. I will go to Varalakshmi. The trade receivables have gone to INR 437 crore from INR 300 crore of the last year. Can you give some aging of receivables in terms of how much is less than 90 days and how much is more than 90 days? If anything is more than 180 days, some color on that will be helpful. Secondly, what are we doing to improve the cash flow on the receivables side?
Almost 80% of the receivables are below 90 days. Yes.
Okay. Anything above 180 days?
There'll be some small receivable, maybe hardly 3%-4%. They are all collectables.
Okay. The next question is, we have nearly INR 240 crore of cash on balance sheet, we will be completing the new plant. Any plans on how to use cash and any inorganic opportunities you will evaluate? Also the dividend payout ratio has been less than 20% for the last five years. This year it is around 11%. What are your thoughts on payout as dividends and cash flow usage in the near future?
Himanshu, we are investing heavily into the future for the company's growth, that gives the best returns to the shareholders. Giving dividend, we have been steadily increasing the dividend as a percentage by something like 10%, 12% per year, we will continue to do that. That's not the first priority. We are in an exciting growth stage. Looking at the way that the business is growing, it looks like the third plant also is going to be filled up fairly quickly. We need to again start building up cash for the next set of investments. We are definitely looking one step beyond the third plant also right now and looking at funding that through internal approvals.
If the strength continues like this, even after making efficiency improvements in the plant and everything, taking the existing plant utilization to INR 2,200 crore-INR 2,300 crore, at some point in time we would need to again make investments. That is our thinking, that we are conserving our strength for the future.
Okay. One last question. We had won an order for geothermal three into 43 MW plant in U.S. in Q2, okay? That was phase I. We stated that the company is looking for phase II, which will be nearly 1,000 MW. What happened on that business? Did we get any more-
We are still the preferred party. It's not yet finalized, it will get finalized soon, I think in the next three months, we should be able to deliver good news to the market about this. Yes, it is definitely a very important project for us. On the radar screen, we're actively working with the customers. They've changed the configuration of the generator number of times. It is still under active discussion.
Okay. Thank you from my side.
Thank you. Ladies and gentlemen, we request you to restrict to two questions per participant. The next question comes from the line of Krupa Desai from Electrum Capital. Please go ahead.
Hi, sir. Congratulations for your good set of numbers. My question was on the NPCIL order. Who are the other players in this space? What is execution timeline for this order and the opportunity size for this order, further opportunity size in this space?
NPCIL, of course, the biggest competitor is BHEL. For these replacement motors, this is a specific market segment within NPCIL that we are pursuing. There's a lot of scope because all the existing nuclear power plants in India are with Russian equipment. There is a big market for it. I can't give you the exact size, but every year we could be getting some good numbers from this business. Of course, once you start doing more and more business on the refurbishment side, on the replacement side with NPCIL, and you establish the performance of the machines in the existing plants, then automatically for the new plants, you have the opportunity to deliver motors for the new plants. The big, huge investments are taking place for the future for nuclear power operations. It will deliver steady revenue to the company year- on- year.
Competition is BHEL.
Okay, only BHEL right now?
Yes, at the moment.
The execution timeline?
Execution timeline is next 12 months.
Okay. What is the order value, if you can provide a number?
We gave that. We announced it already on the exchange when we got the order. I remember it to be somewhere around INR 50 crore, I remember.
Okay.
Something like that, net.
Yeah.
I could be wrong, plus, minus, but around INR 50 crore.
Okay, sir. Thank you. That's all.
Thank you. The next question comes from the line of [Nupur Kogta] from Naredi Investments. Please go ahead.
Yeah. Hello, sir. Good morning. My question is regarding the promoter stake. As we see, it has declined significantly from 58% in 2023 to around 33.2% in the recent quarter. We could also see a reduction of approximately 1.05% in the recent quarter. Can you please elaborate the reasons behind this reduction? Also, is there any possibility of further reduction going forward?
The reduction from 58% to 34% took place two years ago, I think that's not something which is relevant for today. The recent reduction took place due to declassification of one of the promoters as non-promoter. It's not that the shares were sold, the shares were only declassified. The shares are still intact. Future plans, I have to ask my co-promoters what they want to do, but there's no plans right now.
Okay. Thank you. Thank you very much.
Thank you.
Thank you. The next question comes from the line of Jainam Jain from ICICI Securities. Please go ahead.
Good morning, management, and congratulations on the set of numbers. Sir, my first question is, can you quantify the NPCIL order in terms of megawatts?
It's 3 MW something. 13 motors. It's whatever, 40 MW. What information it conveys, I don't know, but yeah, that's the size.
Sir, what was the breakup of motor and generator business in the revenue during FY 2025?
If you take out only pure motor business, not including traction motors, I think if you take only motors, it's something like 6%, 7%.
Sir, what is the average utilization of motor and megawatt like we have currently? How are we seeing increase in that going forward?
I don't have that information right now.
Okay, sir. That answers my question. Thank you so much.
Thank you. The next question comes from the line of Kushal Goenka from Mangal Keshav Financial Institution. Please go ahead.
Hi, sir. Thank you so much, and congratulations on a good set of numbers. Sir, my first question was, as per my understanding, the current capacity can be around INR 350 crore-INR 360 crore per quarter, and only in H2 FY 2026 we can see increase in quarterly revenue. Is my estimation correct?
Yes, approximately correct.
Okay, sir. Sir, second question was, sir, did you mention in your opening remark that for FY 2027 you are guiding for INR 2,000 crore revenue?
I said that there is a path forward to INR 2,000 crore with the new products and the export railway business. The new products that we are getting into, we see a clear path towards INR 1,900 crore-INR 2,000 crore. Yes, I am confident that we will see the path there.
Okay. That can be achieved with the new capacity that is coming live or would you need any new?
Yes, we will not put any new capacity until about INR 2,200 crore. We will optimize, and we will make this existing capacity extremely efficient to produce more.
Okay. Sir, before starting a new capacity, you would need time, right? Beyond INR 2,200 crore also, you will need to plan before one year or something. Just wanted to get a clue.
Yes. Of course, we will plan and we will do it. We'll make sure we don't lose any opportunities. That's our job, and we'll keep the market informed.
Okay. Thank you so much, sir. Congratulations.
Thank you.
Thank you. The next question comes from the line of Vinit from Plus91 Technologies. Please go ahead.
Hi, Nikhil. Good morning, sir. Congratulations on great set of numbers this quarter.
Thank you.
I actually have a couple of questions. You stated Ukraine was a good market for us, and you have mentioned as a key export driver this quarter as well. What revenue did you recognize from Ukraine this quarter? Would we have some numbers about it?
We don't give country-wise data. Sorry.
Okay, sir. As we see that 67% of our orders are coming from export, do we expect this percentage share to be increasing or orders from domestic market would increase as well in the coming years?
Well, it depends on whether we win some of those large hydro orders or not from replacement. If we take that out, I think the ratio will be approximately the same. 65%-70% will be export.
Okay, sir. Thanks.
Thank you. The next question comes from the line of Kiran from TableTree Capital. Please go ahead.
Hi, Nikhil. Congratulations on a great set of numbers.
Thank you.
First question is, I'm not looking for exact numbers per se, but U.S. approximately going by the past con calls about 8%-10% of our revenue. Over the next two years, given the trend in data center, given the demand, would we expect U.S. business to go about 25% of our business? Because U.S. is a big deal, right, compared to Europe? Or are both similar market sizes? So those are the two sub-questions. U.S., will it go to 25% of our business?
Yeah. 20% - 25% of the market of our total business coming from U.S. is definitely a very realistic possibility. We expect that to happen. Yes, the U.S. right now is a very big market, continues to be so. Recapitalization units and everything from Europe is also a big market, but it is not going to move as fast because it is government investment driven. Whereas in the U.S. market, it is completely private sector, tech company driven business. It is a different thing. It is moving much faster. It is already moving. It is already an existing market.
Super. Got it. The second question that I have, Nikhil, is two sub-questions. One is this entry into two-pole generator replacement market. Going by your investor presentation, looks like a very, very huge market size. Is this opportunity restricted for us in India, or is this a huge opportunity for us in the world? Or do we have to test it in India and prove success and only then can we go to the world?
Yeah, Vinay, take this question, please.
Yeah. There is nothing to be tested as a prototype. We have developed our own machines below 60 MW range for the replacement market. We don't have to restrict this only to India. We have the complete market open. This is the first order we have received. There are many installations in India with the old Russian and Chinese machines, as well as BHEL machines. We are going after that. There is big potential, not only in India, outside India as well.
Got it. Sorry, Vinay, my question was more, what is the right to win? Everything that we are targeting is huge market, right? Geothermal is huge-
Yeah.
Everything else is huge. Is there a right to win for us after this installation or even before installation because of all other installations in the world, we have a right to win to install these two-pole generator replacement markets?
Yeah, I got it. Basically, this will be the reference with our own design where we'll be replacing a competitor's machine. We don't have to wait for the installation and go after the market. There are three, four jobs we are already quoting and in the advanced stage of finalization. We have the capabilities. We don't have to prove to the world that we need the first installation and that this is the reference. It is not like that. Before the installation of the machine itself, we are already in the market.
Got it, Vinay. Thanks.
The only thing is, the customer should have the machine which has multiple failures and then he should make up his mind to go for a new one. That is when we enter that and then we give them the complete drop-in solution.
Got it. Nikhil, the other sub-question that I had was, you hadn't had any commentary around motors and how it's progressing other than saying it's according to plan. Any concrete commentary around any particular geographies you are targeting, any particular industries we are targeting?
No, I mentioned we are targeting Middle East, we're targeting India. It's going as per plan. I have not talked about it in great detail, but it's going as per plan. I have nothing exceptional to report.
Both in induction and synchronous? Both in induction and synchronous.
Yes. Yeah, I have nothing exceptional to report.
Sure, Nikhil. Thank you so much. Those were my questions. All the best.
Thanks. Thank you.
Thank you.
I think we'll take the last question.
Yes, sir. We take the last question from the line of Akshay from Xponent Tribe. Please go ahead.
Yeah. Hi, sir. Thank you for the opportunity.
Thank you.
On the geothermal front, can you help us understand, for say, a 100 MW kind of a project, what is the size of work that we would do? Basically, if one had to try to size the opportunity for us, how should one think about it?
This is a very difficult question because it all depends on the geology of that particular site. It depends on how many wells they would need to dig for 100 MW. It depends on the size of the wells. It depends on the environmental conditions, whether there is a lot of H2S gas over there, which needs equipment protection or not, and what are the environmental regulations in that particular zone. It is almost impossible for me to answer your question.
Sure. Maybe I can put it in a different way while I hear you. Just for the project that we have done in the U.S., I understand the phase I.
I don't have the data on that. I don't have the data for what is the total outlay for the investment.
Sure. That's helpful. Thank you. That's all from me.
I'm sorry. I really can't help with that because the market is about 2 GW-3 GW per year worldwide. 1 GW, sometimes 2 GW per year. It depends.
Sure. No, that's helpful. That's all from my side.
Yeah.
Thank you. Ladies and gentlemen, due to time constraint, that was the last question, and we conclude the question -and -answer session. I now hand the conference over to the management for their closing comments.
Thank you, everybody, for this extremely thoughtful, insightful earnings call. We will be in touch with all of you. I hope to see some of you in some investor conference or face-to-face meetings in the next course of time. Otherwise, we will connect with you at the end of the next quarter once again. Thank you very much, everybody, for your time today. Bye-bye.
Thank you. On behalf of TD Power Systems Limited, that concludes this conference. Thank you for joining us, and you may now disconnect your line.
Thank you.