Q1 21/22

Aug 16, 2021

Quarterly report

Ladies and gentlemen, good day, and welcome to Triveni Turbine Limited Q1 FY 'twenty two Earnings Conference Call. As a reminder, all participant lines will be in a listen only mode and there will be an opportunity for you to ask questions after the presentation concludes. Please note that this conference is being recorded. I now hand the conference over to Mr. Gavin Deesa of CEDR India. Thank you, and over to you, Mr. Dissa. Thank you, Nirav, and good day, everyone, and a warm welcome to all of you participating in the Q1 FY 2022 earnings call for Travini Turbine Limited. We have with us today on this call Mr. Nikhil Soni, the Vice Chairman and Managing Director Mr. Arun Mote, Executive Director Ms. Surabhi Chandana, Investor Relations and Value Creation, along with other members of the senior management team. Before we begin, I would like to mention that some statements made in today's discussions may be forward looking in nature and a statement of this effect has been included in the invite, which has been emailed to you earlier. I would also like to emphasize that while this call is open to all invitees, it may not be broadcast or reproduced in any formal manner. We will start this call with opening remarks from the management following which we will have an interactive Q and A session. I now invite Mr. Nikhil Soni to share some perspective with you with regard to the operations and outlook for the business. Over to you, Adika. Thank you very much, Gavin. A very good morning, ladies and gentlemen, and welcome to the Q1 FY 2022 investor call for Trivini Turbine Limited. It's been about 6 weeks since we spoke last, and I trust everyone is well. For the quarter under review, the company has continued to face some restrictions in terms of travel and disruptions at the customer's end, especially in the international markets. However, More vaccinated work focused on increased domestic travel in Q1 FY 2022 was relatively better than Q1 FY 21. In the last 15 to 18 months, the COVID-nineteen pandemic has affected public health, livelihoods and has decimated economies across the world. While the situation in India and many parts of the world seems to have improved from the peak breakout periods, the threat of newer and more perilous variants causing further disruptions still prevail. Meanwhile, the vaccination trials are continuing and Truini Turbine from its stakeholders' perspective aims to lead and be at the forefront of this so that we could return to as normal a working environment as possible. The revenue for the company grew 11.4% in the quarter under review to INR 1,840,000,000 driven by higher domestic sales, which grew 38% year on year to INR 1,230,000,000. EBITDA was lower by 4.5 4.6 percent year on year at INR 413,000,000. The lower share of Exports as a percentage of turnover is one factor which is responsible for lower EBITDA margins as is an increase in Administrative costs. We believe as we do go on during the course of this year, EBITDA margins will normalize at Our existing at our previous levels, which we have talked about through for the entire year. Profit after tax grew at 1.8 percent year over year to $278,000,000 and profit margin declined by 140 basis points to 15.1% in Q1 FY 2022. We had a record order bookings of INR 2,730,000,000, which is the highest in the last for 4 years and the outstanding carry forward order book as of the 30th June 2021 stands at INR 7,280,000,000 which is higher by 14% when compared to the beginning of the year. The company achieved a record total order booking in Q1 FY 2022 adds against a INR 1,440,000,000 order booking in Q1 FY 2021, an increase of 89%. Both the domestic and export order booking contributed to this growth. The mix of domestic and export sales was at 67% was at 2 thirds, 1 third in Q1 FY 2022 as compared to 54% and 46% in Q1 FY 2021. This was a result of the situation in the previous quarter in terms of lockdown as well as certain logistical Impendments that the company has faced in terms of export as well as revenue recognition for export, which will get normalized in this current quarter as well as We believe it will not impact us for the full year operations. I'd be happy to speak about that more in the question and answer. The company has maintained its leadership position in both in the Indian and international markets, and we are very optimistic about the way that the company is positioned for the quarters and years to come. As I said, the domestic market performed exceedingly well in this quarter under review and the domestic market increased by 117% year over year in terms of megawatt ordered. The domestic order booking during the same quarter was INR 200 was INR 2,000,000,000, which is higher by 91% compared to last year. All sectors of the Indian economy have performed exceedingly well in terms of our representation in our order book, which includes segments of distilleries, chemicals, We achieved recovery in cement, steel and other allied cogeneration and process cogeneration sectors. The export market is estimated to have declined 5% year over year for the quarter under review in terms of megawatt ordered And the export order booking for the quarter was at INR 734,000,000, higher by 83% as compared to last year. However, COVID-nineteen continued to impact export sales, which declined by 20% as compared to last year to INR608 1,000,000 during the quarter. We have again performed exceedingly well in securing orders on a remote basis where our marketing team has been able to work with customers on a remote basis and to close orders. But we believe as travel becomes a little easier and we've already seen that happen in this current quarter of Q2, we believe that we would have increased export order booking in the quarter and quarters to come. The Aftermarket segment has registered an order booking of INR 561,000,000, which is higher at 40% when compared with the corresponding period of the previous year. While international travel is limited in this segment as well, the company has been able to garner positive results domestically with more in person interactions as well as travel was feasible. The aftermarket turnover was at $507,000,000 for the quarter, a growth of 19% over the previous year and which has been driven by the refurbishment sector as well as spares. Aftermarket accounted for 20% of the total turnover in Q1 FY 2022, which is up from 26% of the previous year. We are very optimistic about this trend, and we think that aftermarket, which is a high margin sector For the company, which also allows us to have a deeper and more meaningful relationship with our customers, Portra is a more favorable trend for the business where we can have an increased order booking on the product side, but still ensure that our percentage of aftermarket as a percentage of sales increases. And I think that portrays very well for the margin level for the company in the longer term. Design and development of the is a very core part of Triveni Turbine's business operations. And on the technology side, the company continues to develop cost competitive and increasingly efficient models with enhanced profiles and a steam path to meet and exceed all global requirements. We have again introduced a new series of blades, which will allow us to maintain and hopefully exceed our already stated leadership position in this segment. Our R and D continues to be focused on alternate energy technologies as well as certain sectors such as the API market. Our progress on all these development fronts is proceeding exceedingly well, and we believe We will be able to make significant progress during the course of this year, and we believe that we will be spending more money on these fronts so as to secure a more stable revenue stream in the quarters years to come for the company. With aggressive value engineering and cost effective product development Efficiency improvement, the company is also ensuring that it's mitigating any large increases in commodity prices, which have already been visible in certain sectors of our supply chain, but we believe those will not impact the company in the short run, But we only do so for orders which may get executed in Q4 of this year. But to mitigate all of these circumstances, we have already locked Higher and longer term supply chain contracts and rates with our vendors and suppliers, but also have equally passed this on to our customers and both in the domestic and international market. The inquiry generation during Q1 FY 2022 was strong in both the domestic and international market. But we believe that in the quarters to come that we would see A further growth in the inquiry levels both at the domestic and especially at the international level. During Q1 FY 2022, the inquiry generation in the International segment grew by 21% as compared to the corresponding period of last year, These were dominated by the biomass and other renewable IPP sectors, including process cogeneration. Overall, while we await Travel restrictions to be lifted to pre COVID levels, the company continues to focus extensively on virtual meetings to conduct business as well as through our extensive agent network to help facilitate closure of these orders. We also remain positive on the contribution from new segments such as API, which has witnessed an exponential increase in terms of inquiry generations as well as order booking. These have already translated into a variety of performances for the company, which have been reported in the quarter under review and which I have alluded to for the year to come. Overall, the outlook for the year is much more constructive than in the previous year. We believe that we have and effective mitigation strategy for any further lockdowns that may happen due to a 3rd wave or 4th wave of COVID, We believe that we have an effective strategy to enable international travel to happen on a continuous basis despite Any lockdowns that may happen in India or in other countries, we believe that our inquiry book and order booking position foretells A very optimistic situation for the year to come as well as for future years. As you know, Q1 contributes significantly towards the book and bill for the current year, and we are optimistic to be able to reflect that within the growth of both profitability as well as turnover in this current FY 2022. I'd like to open the floor now for question and answers. Thank you very much. We'll now begin the question and answer Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Ravi Swaminathan from Spark Capital, please go ahead. Hi, sir. Good morning. Thanks for taking my question. My first question is with respect to the size of the domestic market. You used to tell it used to be around 700 megawatt, etcetera. How is it likely how is it And how is it likely to grow? You can give an overview. The like I alluded to, we have seen an increase in not only the order finalizations in the quarter But also an increase in our inquiry levels. If you look at the quarter, I wouldn't like you to like to give quarterly levels, but suffice to say that And we talked about this in the previous quarter as well that we are that Srinini Turbine was optimistic in terms of being able to achieve And order booking on the product side for the half year, which would be higher than the full year in the previous year, and we are optimistic to maintain that position. From a megawatt perspective, in the Q1, I don't have the data, but I would ask my colleague, Mr. Prasad, Who is the President of Products to just allude to but Tushar, can you give some idea as to where we sit in terms of total megawatts ordered And how that looks like for the full year to come? Yes. Yes, correct. See, Enquiry generation wise, the domestic market inquiry pipeline is quite good. And in terms of order booking of 1st quarter, It is closer to or compared to last year, it is closer to around 12%, 13% higher in terms of megawatts. That is nothing. Overall, year megawatt size wise, we are expecting around 15% to 20% growth what we are anticipating Based on the current inquiry pipeline, which is around 21% higher domestic inquiry compared to last quarter 1. Got it, sir. And in terms of pricing, are we seeing an improvement in pricing with our customers? So basically, given the fact that demand is likely to be robust, Are we able to pass on prices or the input cost prices to end customers? Are we able to do that, sir? Yes. To This is a customer as an engineer to order product. So no one or to one customer's pricing is exactly the same as another's. But to a large extent, customers do understand that there has been a commodity price increase and those have been passed on. These will depend obviously from customer to customer competitive intensity of those orders as well as the longer term relationships that we may have with them. But in general, we do pass on price increases. Got it. Thanks. I'll come back. Thank you very much. Next question is from the line of Nilesh Chaitani from Envision Capital. Please go ahead. Hi, sir. Thank you. Thanks for the opportunity. My first question is on the opportunity size and the market share that we have. So I believe we are expecting a 15% to 20% kind of a growth in the order in flow. But on the opportunity size, say, a 700 megawatt plus or 15%, 20% growth, are we confident of maintaining our 20% market share in the domestic markets? I think our market share is below 60 megawatt, in the below 30 megawatt segment is higher than 60%. We've maintained that for the last Many, many, many years now. And we are optimistic to maintain that market share level, if not exceeded. Understood. You have another question? Yes. So second question is on the asset turnover. So I believe we don't give our capacity in terms of megawatts, But we give our capacity in terms of number of turbines. So just wanted to understand at the current capacity, what kind of sales levels we can What is the optimistic asset turnover that we can achieve? [SPEAKER UNIDENTIFIED COMPANY REPRESENTATIVE:] That's not typically, it's not the correct way to look at the business because we are Exceedingly focusing our structure of our balance sheet to be asset light. And so not only do we have flexibility in terms of hours of operation and ships of operation Because our manufacturing both from a manufacturing and assembly perspective, typically we say that we are operating at a level of Upwards of 200 to 220 Ult Turbines a year. And on average, you could look at the fact that we are producing half of right now. And so that is about 50% capacity utilization on a steady state basis. But we have the potential to take it up with Increased shifts. Understood. Okay, sir. Those were my 2 questions. Thank you so much. If I have any, I'll join back in the The next question is from the line of Ahmed from Unifi Capital. Please go ahead. Yes. Good morning. My first question is on the order booking. Congrats on the very strong order booking in the quarter. We are now on track to achieve the last year's full year's order booking in the first half. So the question really is, what No, no. We're very optimistic to continue the momentum till the end of the year. Of course, product may be a little bit more lumpy, But aftermarket has given us very good visibility, and we are optimistic on significant growth in the aftermarket order booking for the year. The product order booking also will be significantly better as we as you'd already alluded to the fact that we aim to have a higher product order booking in the half year than you did for the entire full year. So there will be a good extremely good growth in both sectors. Of course, the product growth because of the lower product intake last year would be significantly higher in terms of percentage. Yes, yes. So in the product order booking where our the current run rate is about, say, 200 plus, Do you see that sustaining in the second half of the year also? Or is it just a spike because of the pent up No. We're aiming to maintain that. Our ambition is to maintain that, marginally here and there, maybe around it, but Significantly different. Sure, sir. So in the past, you have alluded that The larger sizes of order book usually come from the core sectors like the steel and the cement. Are you starting to now see A big ramp up in these core sectors? Or is it coming from the usual sugar distillery and other areas? Actually, the sugar sector itself as sugar manufacturing and cogeneration has been very muted for the past year, Raul. We've seen exponential increase in investments in the Distillery segment. We have always spoken about cement We see recovery as well as some fresh greenfield CapEx in the cement side. Steel was a sector which really didn't Fill a large sector of our order book in the previous year, but in this quarter and in the coming quarters, we believe that there is going We have increased investment in this area in small rolling mills and other types of investments in the metal space. So those are the largest sectors, and we think that those represent good growth opportunities. Of course, general process cogeneration, including chemicals [SPEAKER UNIDENTIFIED COMPANY REPRESENTATIVE:] And other food and pharma applications continue to perform very well, but from a megawatt perspective, these are smaller in size. I'll have Prasad again just give a little bit of insight into what he's seeing in the market from the domestic perspective. Prashant? Yes. So from the domestic perspective, we are seeing that process cogeneration is one of the interesting area that is basically covering all like pulp, paper, textile, food processing industry. And the steel, of course, is one of the key area where we are seeing a good traction And even inquiry pipeline is quite substantially higher. Following with API, API is another segment where we are seeing good inquiry pipeline, even finalization is happening. So that way, we can say distillery, process cogeneration, Steel, that is waste to energy, that is cement industry. These are the key industries which will be driving the growth in FY 'twenty two. Sure. That's very helpful. I'm sorry I'm not Sorry to interrupt you. I'll request to come back in the question queue for a follow-up question. Thank you. The next question is from the line of Ashutosh Karun from Oceandal Asset Management. Please go ahead. Hello. Am I audible? Yes. Good morning. Good morning. Congrats on a good set of order inflows. Just wanted to understand, you mentioned about the traction in the export. However, the domestic market from order inflow front has done Fairly well. If you can highlight some aspects how you expect the exports to pan out in FY 'twenty two And if you can share some aspects on how are the margins in export market as compared to the domestic market? Okay. Well, so the 2 aspects that you that I'd like to talk about in the export market, which is one is from an Execution and turnover perspective and the other is in terms of order booking and inquiries. The execution From Swinney Turbines in the export market is dependent on the order book and the carry forward order book that we bring into this current year. And as it is As exports as a percentage of our order book is lower than in the historic past, that would reflect into the execution for this current year in that respect. But we are optimistic that we would be able to that would not significantly impact margins To such a large extent, due to a higher percentage of aftermarket as a percentage of sales as being part of the entire execution strategy. We also have got impacted in this current quarter in terms of revenue recognition and billing to quite a significant extent due to logistical challenges at ports as well as being able to fulfill our inco terms for revenue recognition on On the order booking side, there's a limit to how much how many orders you can finalize on a remote basis. So we have already seen higher mobility of our sales force as well as our agent network. And so we are more optimistic in order booking on the export going forward. And so we as a company are quite optimistic and are putting both money and resources of people and time into ensuring that The export market gets back to our traditional percentage of order booking at about fifty-fifty. We'll take some time and a little bit of effort. Right. And also from the order inflows from a domestic perspective, Would there be I mean, these order inflows would have accounted for a lot of commodity price increase pass on, as you mentioned. So from a volume and price angle, can you give some sense of the growth in volume terms and growth in realizations Or maybe pricing terms as far as this growth in domestic order inflow is concerned? I'm not fully understanding the question, but the we aim for our We aim to increase our market share or maintain or increase our market share as what is historically existing in the domestic market because of our strong portfolio of products. From a realization perspective and price increases, it's not that easy to talk about in a uniform perspective. Of course, all the projects that we'll be executing pretty much until Q3 on the product side will be based on an existing order book and the existing pricing, which have locked in margins. Arun, can you talk a little bit about this question on The realization without being very specific on the price per megawatt? Yes. As everybody has experienced, we also We have fixed price contracts. So it is difficult to get a price increase from the customer. But at the same time, we have long term rate contracts with most of our suppliers. Our relationships with suppliers are long term. They are not for a year or so. Therefore, there is always a give and take On the prices, whenever such a sudden increase happens. So by and large, it is our effort to see that Our margins are not affected and that's what really has happened even in the current year. At the same time, we have got value engineering exercises going on. So every year, between 1% 2% of the cost comes down depending on the project, and that helps us in maintaining the margin. Now since the prices have gone up, we have already taken into account these costs and the prices have already been fact it has been already factored into our new codes. So all the codes which have been in the previous some of them in the previous ones and some of them now, And they are all getting with the new costs. So we don't expect that there will be any increase on it. There will be any effect On our margins as such, realizations depend on the market. So we can't really say specifically A sector or a customer, it's a combination of factors. And we find that realizations are All right. There will be some pressure, of course, which we expect, but due to volumes will be dealt with properly. So overall, it's average plus outlook, I would say. Thank you, sir. Thank you. Thank you. The next question is from the line of Harshad Patel from Equival Securities. Please go ahead. I don't want to be specific in terms of number of orders, but the number of orders that we had That we were able to secure in Q1 was higher than we got in Q4 of FY 2021. And we are optimistic that Q2 and Q3 will be better than Q1. And so we are capturing more market share as we go on, and we are very optimistic on this sector. We think that our product has an extremely appealing value proposition to our We're not only having exceedingly high efficiency levels but a cost point which is very appropriate to the market. And so we're optimistic about it, and it's a market sector that we think will drive growth for the business. As of now, it is not significant in terms of our turnover. Once it becomes a much more significant part of our turnover, we may provide more visibility. But right now, it is a growth sector for us. We're optimistic in getting more market share, and we will report as we go on. As you know, these All these data that we give out are extremely sensitive from a commercial perspective. So I would it is more from that reason that I try to be a little bit more Got it. No problem. So just to get a ballpark idea, could the API segment be 40% to 10% of our overall order intake probably next year? Would that be [SPEAKER UNIDENTIFIED COMPANY REPRESENTATIVE:] Arun, would you like to answer that? [SPEAKER UNIDENTIFIED COMPANY REPRESENTATIVE:] I'm not very clear about the question. Could you please repeat it? [SPEAKER UNIDENTIFIED COMPANY REPRESENTATIVE:] You said can API form up to 5% to 10% of your order book next year? I would see no reason why not I am interested in level Yes. It would be. It would be. The next question is from the line of Nikhil from SIMPL. Please go ahead. Hello. Am I audible? Yes. Good morning. Yes. Good morning, sir. Thanks for the And congrats on a great order booking. I had two questions. One is on the international front. Which are the segments or the end industry where you are seeing good order intake or order inflow? And if you can I'll also share some perspective on which geographies you are seeing the order inflow coming from. That is 1. And secondly, on the domestic business, you mentioned in the initiating call and during Also that steel and general engineering and waste to heat, all these segments along with distillery, we are seeing good demand. But Can you give an approximate breakup between for the industry between these 4 or 5 different segments, what would be the Approximate breakup? B. Balaji:] Let me take your second question first. Unfortunately, I think giving that level of detail and granular detail is not really meaningful to the company From the perspective of giving that information to you because very frankly, it changes quarter to quarter, and it's not reflective of the Overall inquiry book and the inquiry finalization process that we acquired, Ani. Suffice to say That all segments have contributed towards an increase in buy book as well as order booking. That was a trend that I wanted to talk about. [SPEAKER UNIDENTIFIED COMPANY REPRESENTATIVE:] In terms of breaking that up between different sectors, of course, certain sectors like steel and cement, because of the nature of the capacity and They will form a larger part of order finalization for the entire market because they have just larger turbines For applications, then typical process for generation that may happen in areas such as food and Pharmaceutical, etcetera. Of course, paper is also a large is a high megawatt segment. What was the other question? Sir, what was your first question? B. Balaji:] Question was on the international side. Which are the segments of the end industries we are finding for demand And the Subini markets? [SPEAKER UNIDENTIFIED COMPANY REPRESENTATIVE:] Yes, yes, yes. So Subini Turbines has a and again, for the financial for the calendar year FY 2020, we had a market dominance in the global Renewable Energy Space. So that is a sector that not only do we have a very appealing value proposition to, which we're very happy about because that is the only growing segment in the market, But that also constitutes the largest sector or segment of our inquiry book and therefore our order booking. So applications such as solid municipal waste incineration, biomass based IPP either from sugar palm oil or a variety of different agricultural residue based ITPs to other waste heat recovery and renewable applications always forms a larger sector of our segment of our order booking, and this is in every geography. Now if we add the process flow generation applications into this as well, where you have heat as part of The one of the requirements of the customer, the company fits these types of applications. In the quarters run by, we have seen good inquiries from order booking from South Asia, South Africa, Europe, Middle East. These are the regions in which we've seen good orders. And just one last question, if I can squeeze in. On the Cost side, you mentioned that most of the orders which would be executed is the old order book, which It was booked last year and the pricing was fixed. And considering the RM increase, I'm not able to get in how we can maintain our margins. It should hit us in some way, right? Just if you can So let me break this down for you. Typically, as Arun already told you, we are not buyers of Raw Metals, we only buy value added work, which is either done through a significant amount of Processing or as a product itself through our vendors. And so therefore, the element of price increase [SPEAKER SRINIVASAN VENKATAKRISHNAN:] And the component that is ultimately supplied to us is has as the material composition is not as reflective of the entire price increase that may have happened. Secondly, as Arun pointed out, we have long term contracts. And so very frankly, even if there has been a price increase, Our execution based on the execution pipeline has already captured the costs. For new orders where the dealer price increase, those to the effect, they will be passed on to customers. Again, as we've already said, it's better not to look at it from a quarter to quarter basis. Like for example, if you look at this current quarter, We've seen a material our raw material as a percentage of sales have gone up to 54.3% from 52.3%. That 2% increase in raw material is based on significantly higher domestic product or domestic turnover than international, which has a higher margin. And so therefore, you see certain percentage of margin Squeezed because of that sales mix. The sales mix will get reversed or will get significantly changed in the quarters to come. [SPEAKER UNIDENTIFIED COMPANY REPRESENTATIVE:] And so therefore, we believe that, that would be margin accretive. To the extent that you have price pressures and given the fact that we have value engineering exercises also continuing, We are optimistic that our general margin profile of the company is not changing. So that is the only impression that we wanted to leave with you. That despite and we are fully cognizant of where the commodity price increases sit. Okay. Thanks a lot, sir. Thank you. The next question is from the line of Manish Goyal from Manam Holdings. Please go ahead. Yes. Thank you so much. Just would like to clarify and get better perspective on the order inflow So just trying to connect a couple of comments what you made. One was that you expect you mentioned that inquiry pipeline was Very strong, and we expect that inquiry levels to grow further in the coming quarters. And first half order inflow in products would be equivalent to Last year's entire year. So basically, does it also imply that the strong Absolute order inflow, what we see in the first half can get replicated in the second half as well in terms of what we see in the half one And which in turn would mean a very, very strong order inflow for the entire year of FY 2022. So just want a clarification on I'll just repeat for that. But you have to recognize you are absolutely right. And that's exactly our plan for the year, which is to maintain the momentum that we have in Q1. But you have to recognize that part of Q1 auto booking was a carry forward from Q4 of last year, which we've said happened to a variety of reasons. But despite that, there is overall positive sentiment in both the domestic as well as international markets. There's ample liquidity. There's very good commodity prices, which validate good investments in the sectors which in which trivially turbine participates. So we are optimistic on growth in our inquiry book as well as order booking in absolute terms for the entire year. So just further to clarify because there was a comment made that in FY 2022, we expect 15% to 16% growth in volume terms. So maybe if you can clarify because it does not connect because See, INR 4.41 crores of order inflow last full year and entire thing getting achieved in the first half. So a bit confusion over there. No, no. I think that comment was to the extent that we see the domestic market increase. The domestic market increase in terms of total megawatt ordered, We go from about 700 megawatts, as we're seeing right now, to about 1100 megawatts, 1200 megawatts. And very frankly, as we sit right now, we are looking at a much For Sweeny Turbine itself, we're looking at a very good increase in order booking, not only in the first half year but for the second half as well. This will be contributed both by domestic and international, as I said. So the international market will play a larger role. Okay. So that was more to do with the okay. So ideally, what we are saying is that the domestic market is roughly at 1100 to 1200 megawatt right now on the inquiry side? No. The inquiry book is actually larger than that. It's upwards of 2 gigawatts. So ideally, it means that we probably are back to the peak, what we saw in 2012 in terms of the market size potential? No, no. That was the order booking in that year was about 2 gigawatts. I mean the I think that we are A little way off from those peaks. We're optimistic that by 2023, we may be hitting those levels. Sure. And one more question on the margins front, if you can so basically, as we progress going forward with better revenue mix and other efforts what we are carrying on. So we should be able to maintain The margins what we have seen last year for the entire year? Yes. That is what we aim Okay. Okay. Fine, sir. Thank you so much. I'll come back in the queue, sir. Thank you. Participants are requested to ask for 2 questions for participants. If time permits, please come back in the question queue for a follow-up question. The next question is from the line of Kunal Senth from B&K Securities. Please go ahead. Yes. Hi, sir. Thank you for the opportunity. So my first question is pertaining to the export market. Sir, I just wanted to understand the Beyonce that we are seeing in the export market. Would you attribute it to the uptick in demand in those global markets? Or it is also a factor of the fact that we've been working on increasing our reaching various global markets and that is what we're seeing right now? P. Vijay Kumar:] Yes. It's both. You are very right. It It's also a question of pent up demand, the demand that could not happen in certain countries because of lockdowns, etcetera, especially in areas like Southeast Asia. [SPEAKER UNIDENTIFIED COMPANY REPRESENTATIVE:] So it's a combination of all, an increased pent up demand, fresh demand based on liquidity and also a higher and greater market coverage, which includes sectors Both in our traditional applications, but also in new areas such as API. So it's a combination of all three footprints. Okay, okay. Great, sorry. And sir, my 2nd question is pertaining to your execution in the export market. So you mentioned that there are Some issues relating to execution in I mean, wholesale market largely related to logistics related issues, supply chain. So is it right to assume that it is only supply chain related issues and if those were not their clients are more than ready to You execute whatever is due or there are some delays even there? B. Balaji:] Yes. I mean, You see, the supply and execution of the steam turbine project happens over multiple years. So the fact is that customers want to Get their supplies as quickly as possible so that they can get ready. So 1 or 2 weeks here and there may be delays that people may have based on certain Problems that they may have at site in terms of readiness. But in general, we don't see any problems from a customer's end in terms of In fact, they try to get it so that they can achieve different milestones of the financial closure, which is necessary from their bank's side. From our perspective, logistically, we export a skid mounted, not containerized. So our issues are of a different nature in terms of logistical supply chain matters and which is In terms of the lockdown and not being able to have the ports functioning with the degree of efficiency that they should operate at was the constraints that we faced. We believe these will get normalized out. We already have significant orders, which we're not able to achieve their revenue recognition milestone of Incoterms. And we don't think that this significantly impacts us for the year. We will be quarter to quarter changes, [SPEAKER UNIDENTIFIED COMPANY REPRESENTATIVE:] But this is it's okay. It's not the biggest problem. I mean the biggest problem is yes, we have very poor Port infrastructure in India, we have very long transportation time for sea cargo. We have not direct routes to a lot of our customers. So those infrastructure issues are massive, but They're not significantly impacted by COVID apart from the short term movements. Sir, is it right to assume that on a low base of last year, last year, we degrad almost 14% in sales, 25% growth this year is doable? We wouldn't like to give numbers because then that becomes a little difficult. But We've shown that we have a very strong order book to execute our 1st 9 months of sales, which you know that we work on. And our Q1 is indicative of our book and bill for the Q4. And so we are in a very strong position right now to exhibit strong growth for both top line and bottom line in this current FY 2022. Sure, sure. Thank you so much for detailed explanations and best of luck for the future. Thank you. The next question is from the line of Ahmad from Unifi Capital. Please go ahead. Yes. Thanks for the follow-up. So I just wanted to understand a bit more on the R and D efforts. The API turbines already started contributing, A few more points, which you have mentioned in the press release, like the CO2 cooling solutions and the supercritical CO2 power blocks And one for the shipping space. Can you please highlight what's the status of these initiatives? And when These are R and D projects, and so they will take a little bit of time before they get commercialized. We're very optimistic on The scheme, the only reason to give those variety of applications was to say that the technology that we're investing into, which is supercritical carbon dioxide as a means for energy transfer, has a very wide application. But I have to say that by the time that and very frankly, we are quite confident that this technology will disrupt ourselves. It will move a variety of applications apart from straight backpressure, certain extraction condensing applications into a mode of supercritical carbon dioxide for the medium term. So we would see commercialization in A year or so, but by the time it starts contributing significantly to our turnover, it could probably be several years away, like 3 or 4 years away. Right. Okay. That's helpful. Thank you. Thank you. The next question is from the line of Bimal Sampan, an individual investor. Please go ahead. Yes. Thank you for the opportunity. Now that you have said that we are working at 50% capacity. So we don't foresee much CapEx over the next few years. And in the 2, 3 quarters back, on call, you had said that we are going to decide on how to use our cash. Either we are planning to get into a new product Can I take or give dividends? Hello? Yes, yes. I'm right here. Yes. So I mean any decision on how we are going to use our cash? No, you brought up a very important point. Unfortunately, the Board hasn't considered any of that at this point in time, so I have nothing to report to you. So suffice to say that we recognize this as a very pertinent problem for not only the company but for our investors. And so we have to work on it in a short period of time and get back with an appropriate Capital allocation policy as well as how we foresee the growth of the business in its different product lines. So by end of this year, something concrete, you have will you be able to I would be happy to give it to you right now. It is when the Board considers it prudent To discuss it and disclose it. Right, right. And second question on our API. And this is super critical what we are working on. Yes. You said, yes, I understand that is R and D work in progress. But when do you think we'll be at commercial stage On the supercritical? We would have certain products which should be ready to be commercialized next year. And then following on from that, we will have a progressive step of commercialization of different modes and models for different applications. And what is see, I'm not a technical person, but what is the market size of this? In general, the size of Arun, if you're there, if you could just give a little bit of idea About what is the value proposition of a carbon dioxide turbine, SCO2 turbine, both from a costing as well as efficiency level? Yes. These supercritical CO2 turbines, these are the turbines which can be used in the State condensing mode, that means only one application, that is a power plant application. Now The other applications like extraction and back pressure applications, that is not suitable. So this would address one type of market. Secondly, if we consider the size, the size of this turbine would be about 1 5th of the present turbine. So space occupied will be much, Much lower. Apart from that, there will be some special materials used. So the cost is something which we won't be able to tell right now, But the payback period is expected to be quite shorter. It could be about 3 to 5 years depending on the project. So the value proposition for the customer Would be very good. That is one part. The second application is the cooling application. In Europe, this has already started and are This is an environment friendly application. And therefore, the supercritical CO2 will Replaced the present coolants like Freon F22 and other ones. So that's what the application is. Now these are, as Mr. Nikhilsani has said, these are about couple of years away from us. So it will not be correct on my part to give you some specifics on the pricing and Just a ballpark thing. To be as big as our less than 30 Or how do you I mean The point is that not as Arun alluded to, because of The configuration of this turbine, the material weight, the size of the turbine is about 20% to 25% Of a normal steam turbine. So you have significant material cost reduction in terms of weight. The metallurgy aspects are different, so you may have. But Given that what you then have is application of sizes which are significantly higher. So there's no reason to constrain yourselves to a lower megawattage size. So therefore, the end applicable market is much larger. Could you understand what I mean? Yes, I got it. Thank you. That was very helpful. Thank you. Ladies and gentlemen, that was the last question for today. I will now hand the conference over to the management for closing comments. Thank you very much. Thank you for joining, ladies and gentlemen. We didn't have time to discuss the aftermarket sector of Terevi Turbine, but suffice to say that it is performing exceedingly well. We had a much higher order book in the domestic sector than we did in international, but we are optimistic in the quarters to come that, that would also be bridged. The company has had a good order booking for this Q1, and we aim to maintain that in all subsequent quarters of this current financial year, which would place us in a very good position for achieving our targeted turnover and profitability for this current year, but also leads into FY2023 with a very good order booking so as we can achieve an even higher growth in both profitability as well as Turnover. So we're quite optimistic the way we sit today at Savini Turbine, and we look forward to your joining us for our next quarter's On behalf of Trivaney Turbines Limited, that concludes this conference. Thank you for joining us. You may now disconnect your lines.