Q3 19/20

Feb 3, 2020

Quarterly report

Ladies and gentlemen, good day and welcome to Treveni Turbine Limited Q3 and 9 month FY20 earnings conference call. As a reminder, all participant lines will be in the listen only mode. There will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call Please note that this conference is being recorded. I now hand the conference over to Mr. Risha Bara from CDR India. Thank you and over to you, sir. Thank you. Good day, everyone, and a warm welcome to all of you participating in the q 3 and 9 months at 5 20. Earnings conference call for Praveen Divani Limited. We have with us today on the call, Mister Dhruv Soni, chairman and Managing Director, Mister Nikhil Soni, vice chairman and Managing Director, Mr. Aaron Mote, executive director, along with other members of the senior management team. Before we begin, I would like to mention that some statements made in today's discussion may be forward looking in nature and a statement to this effect has been included in the invite, which was mailed to everybody earlier. I would also like to emphasize that while this call is open to all invitees, it will not be broadcasted or reproduced in any form or manner. We will start this call with opening remarks from the management, following which we will have an interactive question and answer session. I now invite Mr. Drew Soni to share some perspectives with you with regard to the operations and outlook for the business. Over to you, sir. Thank you very much, and welcome everybody to the third quarter FY 2020 earnings call. I'd like to begin by presenting you the 9 months consolidated key highlights. As we've been saying, operations of a business cars are not being quarter to quarter. So I should concentrate on the cumulative 9 months results and then go into feelings of the future, both for the end of the year and for next year. The net income from operations for 9 months, consolidated is at 6.64000000000 rupees, a growth of 11% year on year, but our record, is DPAT, in the history of the company at 1.08000000000 growth of 50%. Again, I'd say that, you know, this is, extraordinary, from certain quarters. And it's it's not something that happens every quarter, but we're very happy that the 9 months results have come out with such a good bottom line. We have a strong outstanding order book at, uh,700,000,6.94000000000 rupees. The total order booking during the quarter in Q3 was good, and appreciably better than what it was in the first half of the year. And 2,100,000,000, rose to 11% year on year. And this enabled us to bridge the gap, which was there in the first half. Which I mentioned during the last conference call. The order booking for 9 months is just marginally lower than last year at 6.36000000000@versus36.45. We expect to end the year with the same if not better order booking than what we achieved in FY19. During the last during the 9 month period under review, the turnover was 11%. Higher than the last year's period. And here, the domestic side has grown very substantially by 24%. And international was marginally lower. In order booking, I would like to highlight that in q3, our international order booking was very good. We've started off the half year, even in the half year, we had a deficit of 63% versus, 43% versus last year. In H1. That comes out to 25%, in, at the end of 2, 3. And we we expect good orders and we already have some in Q4. So we expect to end the year with, at the same sort of order booking as we achieved in FY 'nineteen, it's not slightly better. In the international market, there have been a lot of turmoil, as you know, And for us, some of our key markets were affected namely Pakistan, Turkey, and the Middle East. But we are in the future, it is looking extremely good, and because we are big growth of inquiries from Southeast Asia and from Europe. We have, for 2% of our inquires are from Southeast Asia at 25% from, from Europe. And here, we expect this, a good order conversion. I mean, you're putting quality conversion into orders. So, FY21 order booking also is looking up. And the mix is what we are very encouraged on. That's where we are seeing domestic growth also at least the same amount and international growth So we have had a rectification of the situation that might have happened temporarily in H1 of the current year. If we look at the 9 month period, net income, which was, 0.64crawl has an EBITDA of 1.49 for the 9 month period against 1.22, growth of 22%. And your PBT again has a a growth of 28% understanding of 1,380,000,000. And I said earlier, the VAT was, a very good 50% growth at over a $1,000,000,000. And giving us an EPS, not annualized of 3.34 a share. I'll be going into the, domestic and after markets in a few minutes and export. But I'd like to just check, for a minute about our research development, The company has a strong focus on technology development. And, through the very dedicated team of, design and, development engineers, and, the push that we've had on efficiency of our products, and making them more cost competitive has really bought fruit, and we are very encouraged now, proven results that we are at the front line of customer expectations on the value for the product looking at both efficiency and cost. And that is one of the reasons why we encouraged by our, order conversion and the spread about geographical, inquiries and order booking. The company's effort in, design and testing is being closely supported by our collaborations with various international design houses and universities both in India and overseas. That way, the backbone of our support system our new test bed, which we put up, and this is, definitely the most modern test bed for a for a turbine facility globally. It has had started to operation, and, it's already making contributions of bringing our cost and time in our development sciences. I think one of the points I'd like to mention in, in, as and design and development is a new, segment that we've got in order for, which is a geothermal segment. We've received an order for a geothermal, Dubai refurbishment, which is a very prestigious, high-tech, order. And here, the markets are are good growth, both in Australasia and in Africa and good margins. So This is a good breakthrough that we've had in the last quarter. The research that we are carrying out with, the institutes for the development of, Supercritical CO2 Cycles. It's carrying on and we've talked about it before. And we're very encouraged by, the close cooperation that we are having both in India and overseas in this absolute frontline Doclarity line, and this will continue for the next few years. But we are making good progress here and that's also a very encouraging fact. The a market that we have been talking about for some time is the oil and gas market. And we've developed new termites for this market. I'm happy to report that in in January, which is actually q 4, We've now received further breakthroughs in drive turbines. And so this is is really taking a long time to to get these breakthroughs But the market, as you know, in the oil and gas for drives are small, is very good. At the moment, we have just started. So the upside is is big for FY21. Both in terms of margins and in terms of orders, even though the the speed may be lower and the numbers are higher. But these are the developments that I like to share with you on the design and development. I'd like to just quickly mention, about our joint venture Gee, if you have communicated to you in June, if you have filed a petition with the national company law tribunal, And that and this has now moved to the National Company law, and the matter is up to this. It's developed for orders, but this is not affecting our country's business. The JV received orders of 830,000,000 And the performance of the day in the quarter has been okay. It's achieved a total revenue of 11,170,000,000 rupees and a subsidized attack of a 158,000,000. So we are carrying on normally as we were before. I just want to mention that in the domestic market, we are seeing which may be a little different to what this London, as the situation will not bleak in the future. If anything, we, have seen a slight upturn, And we expect that to stay where it is in our segmented lines. They are coming from both the process code generation, distillery segment, the biomass, IPPs, and the the renewable space. Coming from our aftermarket. At the moment, Our percentage of aftermarket to total sales is down at 23 versus 27% previously. We expect in q 4, this to correct, and we expect it to come back to 25. And in H1 next year, we will will hope to be higher than 27 again. So this is the encouraging, order booking in aftermarket. Both, especially in the refurbishment, international sphere. So this is the incredible fact which we've looked at now. We've got very harsh inquiries, and good traction in different geographical areas. So the aftermarket business is where we are seeing a positive growth in in FY 2021, both in terms of execution of orders on hand and in terms of order booking for the balance and for the for 21.22 and 22, 23. While we get 4 points, as I mentioned, we are expecting much better traction in Q4 and in FY21, than where we can see visibility in the first half. Again, it's the forefront that we've we've got in terms of our product, the acceptance of our new products in the market, both in terms of efficiency and cost as a different geographical and product sequence that we are getting to. I would say that with our order on hand right now, which are good and more substantially the Guardian pipeline, both Internationally and, for the aftermarket. We look forward to a very, very good performance in, in in at the end of the year, for FY 'twenty and a good performance going forward into the first half and, of twenty one, which we can see now. The cost control efforts that we started last year have borne fruit. And we are increasing these and we're reaccelerating various initiatives in the next 6 to 9 months. The new the penetration, new geographies are working, and it's tran it sends them the the the company's performance in the export market. We now have orders and installations in over 70 countries. And, looking at future markets beyond the 70, The segment, as you know, biomass, paper, profits, and cogeneration, super cogeneration, disbelief, farm oil and the new segments of waste to energy and the oil and gas. We believe that this strong inquiry and order on hand pipeline and the aftermarket business, which is hooking up with the international market, all as well for ready turbine into the next 6 to 9 months. Wherever the availability you can reach it to. Thank you. I may open it to questions, please. Thank you, sir. Ladies and gentlemen, we will now begin with the question and answer session. Questions. Ladies and gentlemen, we will wait for a moment while the question queue first question is from the line of Ravi Saminathan from Sparks Capital. Please go ahead. Hi, sir. Thanks for taking my question. First question is regarding the drive that bank. You had mentioned that you had won a order in the 4th just wanted to get a sense how, largest opportunity is there. And, what is the size of, possible quantum of orders that you had received in 4th quarter? Adi, the point is that as the chairman said, the drive turbine market is a where we have very low part, installed base ourselves. So it's a market for us where we look at in terms of approaching a manner where we can expand our uh-uh, a new product category and segment. So the fact that we are facing success in it leaves a matter of it is an it is a large term by an order. Let's talk again with values of it. But we think that this proves our our potential that we have a feasible product for this line. We have products which will stand well, and this specifically into the oil and gas segment itself, which is a more lucrative end of the, of the driver and market. It's something that's very encouraging, and it's something that we've been talking about. Yes. It'll take time for us to establish a good market share, but we're on our way. We we think that we're gonna have more traction as we go is the oil and gas market is different to other markets because there, they have they replaced their device. These dry service are small box for for the oil and gas sector. So they are replaced very often, in terms of, versus other power generation, process industries. So that's why, even though the oil and gas market may go up and down, the drive market for oil and gas is a fairly, stable one. Got it. So, I mean, is it like the replace comes with this dry dry batteries, or how is it? So The the the the the turbine drives the pump. The drive the right drive the park. It drives the compressor, drives the slower. Okay. Okay. And then get replaced often, Roshin? And these orders are from the Middle East mostly. Ah, yes. There you go. Okay. Got it. And, in terms of export, you had mentioned that there is a, a healthier, pipeline and query pipeline. So basically, what could be the size of that pipeline? Usually, we used to do numbers in the low gigawatt. How is it now vis a vis how it was last year for a domestic student and gave some idea to be great. As I said, we we we are expecting order booking to be the same same as last year. The inquiry, you know, from Southeast Asia, and you're not very good. I'm I'm getting the 2.5 gigawatts. Okay. And, last year, how how was it, sir, from your time? I'm about to say About the same. But I'll tell you why we are more encouraged is because the areas that they are from are not the ones that that went back. What I would say. You see, if we had ordered from Pakistan and from Turkey and all of those markets, we just we're not available to, I right after the time went there to spread. Mhmm. Even though it was a very major market for us and we, as you know, we had a major market share of of of sugarco's innovation in Pakistan, Sabrina head. Got it. Got it. Sir. And, my final question is with respect to the JV, I mean, we continue to keep receiving orders from this in spite of the case, which is going on currently. So is it like these orders are the ones which we had bid for earlier during better times and that is getting converted into orders now? Or is it like so this is joint venture continues to be for order in spite of the misunderstanding between the two parties? We continue to withdraw that. Okay. Okay. Got it, sir. I'll come back in the queue. Next question is from the line of Bhavan with Lani from SBI Mutual Fund. Please go ahead. Thanks for the opportunity and, congratulations on good numbers. Despite that. Thank you. Just a clarification on the international, I'm looking at your press release, which mentions 28% growth in the order booking. And you mentioned, healthy inquiry, but you mentioned the order booking will be similar to the last year. So Can you help us? That's for the quarter. Q3 for Q3 sort of growth versus last year, but for 9 months, it's still a deficit over last year. Because of the numbers. What the chairman was pointing to is the fact that for the full year, the international market, we would be meeting up with the numbers at least from that front while the domestic market, as you see, it has grown quite considerably. So we're looking positively at the at the opening order book starting FY 2021. Sure. And, as you also mentioned, about encouraging pipeline on the aftermarket, is there some color on it? Some more color on that will be helpful. This is just because we're we're we're a a month into Q4. So we have visibility on order that we have placed. And so that's what he was saying in terms of, being able to to get a better order book and hopefully order book the aftermarket segment as well. Getting internet, sir. But I can say 11, in a very encouraging, it's a it's a bit of a or long haul for the huge market is a refurbishment of other people's thereby, especially Internationally. Of other mix, And we, have received order and we are, some some of the inquiries are very hot. And those are very good orders and good margin orders and a good spoke where you're able to have where you're able to get the growth in various different segments and various different industry segments and geographical segments. So you see the area of, of aftermarket stretches from 2, 3 areas. 1 is, of course, the parts for our own turbines. The other is a service for our own turbines and and it's for 3rd party. For our own domain, that organically is growing at about, 7 to 10% a year. Based both on, a larger installed base as well as, certain inflation on on the product, on on the on the pricing side, service similarity. And so organically, and these are for that. I had good margins, and so we're able to act to to to get a good contribution from that. The refurbishment area is dependent on multiple different, of, product offerings that we have, which stems from anywhere from overhaul to higher higher value addition, services such as a remeeting and and upgradation of, of, the power output from our turbine. Now, so this all depends on where we sit in our proximity to customers and our relationship with customers. Is they difficult to provide you great clarity on how we can do this apart from saying that the conversation that we're having at such an advanced level with customers that give us confidence, and some of those already translated in quarters. So it's a question of, just moving ahead with this this this segment on a geographic basis where we can cater to customer's expectations better. But you know, here are where the real breakthroughs have been for us. We've got people with us, who have agreed to air freight the rotor back to us, and we refurbish it. We engineered it and give it back to them with a better efficiency and freight it back to them. And that's a very substantial, transportation logistic, which they feel we are still very, very competitive in doing it, plus, not having the termite work for some time. You know, and and when we do this, we we are looking at it as relationships with groups. So one of the largest groups in India has placed, an exclusive contract with us for aftermarket service or third party with some with some confidence of all, but the fact is that this is we're approaching and we're starting approaching it from a from a basis where we can occupy our overhead better in terms of sales and support? This large group, business you're talking about internationally, and not India. This is an India, but the approach is the same internationally. So in our international, we have a good group from South Africa. Sure. And given this, could we Could we assume that a double digit growth in next year seems I have probably No. We we we will not wanting to put, any forecast out, it's too early, but, I I can say that we are encouraged and we expect, growth we would expect to attend because I mean, I would like to say growth rather than putting numbers. Sure. Yeah. Thank you so much for taking my questions. Thank you. Thank you very much. The next question is from the line of Anand Badani from Unifi Capital. Please go ahead. And thank you for the opportunity. I have 3 questions. The first question is, And early in the year, you had indicated that we have, you know, offices set up overseas, to, done a more business, and we have been spending, on it. So if you can update us as to how that is panning out how many offices have been opened and is there any business generated out of this initiative? I think all three questions. You mean the other 2? Yeah. The second is in terms of business. This year, you indicated we lost quite a bit of business to, which are they used to come from Pakistan and Turkey. If you can quantify it as to the, you know, what was our, total, let's say, early contribution from Pakistan in FY19 similarly for Turkey? No. No. We don't go into these, some mushrooms. These are fairly, sensitive to mushroom matters, which, to, give out such details. We haven't done that in the past also. Yeah. And the third question was at the location last year, you did a buyback, and it's, you know, it's the time period to consider buyback is again approaching. So are there any updates whether the buyback is on the cards? I'm like, I can tell you we finished our board meeting, but nothing has been discussed. But, you know, we are sitting on about a 150 hours of, the liquidity of the company is good, and we liquidity in the company is expected to be increasingly, good. So, you know, we are a little different position to many other manufacturing companies in India where we are, having Treasury operations. We have very conservative treasury operations. And, rather than anything else in the balance, I would have to say needs to be considered by our board. But I can take your first question, and I want to be, a little bit, open with everybody. We looked at, our, handling international sales through the offices. And are handling them from from Bangalore. And we found that the value add, from the, having the quality and the number of people we had to send from from Agala to support it was, still quite a lot. So we were not getting as much value add as we thought we were going to get. And we could do it just so easily and at a cheaper cost and as effectively not more, from Bangalore. So while the travel cost may be actually, increasing from Bangalore. We were getting better coverage and the results have been good. So we have not, we we wind down some of the, the operations down slightly in in in in the international Sierra offices. That's all. But, we're not looking at opening any new ones. Okay. And, so in case of ours, existing setup. We are not anticipating any additions in FY 2021. We had enough capacity. Right? So there'll be no CapEx safe closing that? No. No. We've got plenty plenty of, space in capacity utilization with the new factory. And, CapEx is very small, similar to what is in the current year of, 718. No. That was very nice. Thank you. About 23, which is not much. That is, you know, some balancing and some testing and some and some design software. And we are we've acquired a bit of a CapEx. I mean, the figure is is is is similar to this year, which is just around 2021 crores. Automation, IoT, you know, so we are going very heavily. We are in project management, Pimavera. So we are more on the technology side, both in terms of design technology, automation, and speed of doing business. So and if I may squeeze in one question, we had taken, you know, some cost control initiative. So there any benefit left or we have already gotten all the time for the course? No. No. No. No. We we have taken it, but we have looked at areas of further cost benefits, and we are even with some of our design efforts are continuing to go in this direction. So we're spending money for cost reduction. And we will continue to do that. We feel we can still get more cost out, in the next, 6 to 8 months. Absolutely. Okay. We'll continue to have the syringe in q 1, q 2, and then further up. Thank you. I'll come back in the queue. Thank you. Thank you. The next question is from the line of Harshad Patel from Equity Securities. Please go ahead. Hi. This is Harrison from Equities. Sir, I had, thank you very much for the opportunity. I had two questions. The first is sometime ago, there was an order from central pollution control board that even captive power plants, we have to put activity systems. So if they do that, do they, their, cost goes up and consequently, their internal, return ratios come down. So, sir, does this effect any rated demand for our our our kind of turbines? No. One thing, let me so to explain something, most no one is setting up a power plant, a captive power plant to export to the grid. That may be a consequence of if it's a biometric power plant beside a different and air pollution control. But in from a cost economic perspective and steam is used as part of the process, the the cost of that steam Next, it always validates the the the the the company to set up for power generation at the website. They don't have, where what you're talking about is not really applicable to, to the type of, part generations of people we, sell to, and, So it's it's it's really not a consideration at all. I, you know, people are having to go for air pollution. They're going for 0 discharge and things, which is embolored. And so it's not really, the turbine part is very, very small, if at all. Sure, sir. Enter my another question would be a bookkeeping 1. So, in our outstanding order book for aftermarket, So can you breakdown that between domestic and exports? Don't know whatever detail we give, but I think the detail is in our investor brief. You can take it from there. Sir, that's actually not given in the presentation earlier. You used you just needed. That's why I asked. Right. We should get back to us. Our plan will give it to you. Don't have it with me right now. Thank you very much. That's all for myself. Take care. Thank you. Next question is from the line of Manish Goel from Enam Holdings. Please go ahead. Yeah. Thank you so much. A couple of questions, sir. First on, sir, do you see any risk on, executing the current order book or potential order inflow from the outbreak of the virus in China? No. We have no orders from China or No. Not China, but, say, probably it's like, Southeast Asia and Where? Southeast Asia, Not really. We we continue to export. Yeah. They're not, they're telling the people what you're seeing up and not really I don't find anything either. I, myself, I'm thinking of traveling this month. And, sir, sorry to harp again, but, just on your initial remarks in terms of order info, which was similar to FY19. Just back of the envelope calculation shows that, the order info number would book. More or less remain between 210.20 crores, which will again be equivalent to number what we in flow number which we had in the q 4 of year. And, so so ideally, what it implies is that the order book, which is already 8% down in the 1st 9 months, and looking at q 4 exhibition, which is always, the best quarter. My worry is that your order book may decline more than 10% which in turn probably, reduces the growth opportunity for FY21. Uh-uh. No. We we we expect to have an opening audible. On 1st April 2020, which will be, wait a minute. Wait a minute. It's saying it's not slightly better than what it was on 1st April 2019. Okay. Okay. Okay. Okay. Fine. Okay. That's right. Thank you so much. Thank you. Thank you. The next question is a follow-up from the line of Arman Dotani from Unifi Capital. Please go ahead. I just wanted to understand for our, domestic as well as international markets, is there set of refurbished turbines of, let's say, Chinese make, being a more cost effective for, customers and they're differing. No. No. No. No. No. This this this no. They're they're not able to they let me tell you that in the power generation market in Orange, The Chinese don't seem to be keen. They're manufacturers at all. I mean, there's there's so many of them. They are They're quite happy to concentrate on the Chinese market and on the, where this Chinese funded projects. I want you to also mention to you that, you know, from an international source, uh-uh, international data source, of wind turbines. In the 1st 9 months of FY19, for which the data has been given to us by this when we are a subscriber to the source in the 5 to 30 megawatts line globally. We are number 2 in terms of of number of turbine and megawatt of turbine, sir, units sold. You a unit sold. In this internationally. So that is, I think, a very commendable thing. That we have achieved this, we did that in FY18 also. And there are no Chinese anyway in the horizon and that. So that's why we know where they are. So so I just, certainly, wanted to understand if you had to keep aside the the loss of business in Pakistan, Turkey, Any other significant disappointments for us in the 1st 9 months of the financial year? No. I I I mentioned it to you. These are the two places and some parts of the Middle East, which we've also compensated now. This is primarily in Africa also. But I'm not Africa. I I personally, I haven't thought that that's it, sir. But there are other parts of Africa that have picked up this in Nigeria, but Yes. Yeah. So that's total Africa, though. But let me give you more is to say very, finding encouraging inquiries and growth from the kids and I don't think that's gonna be affected by the virus. And Europe, there we are seeing good traction in inquiries and but when I talk about inquiries, I talk about things that look like active inquiries. So we categorize our inquiries also into 3 categories. Of, completely budgetary, or active and very active. And, sir, in terms of inquiries, any quantification, like, are the inquiries same as last year or they are like, They're very diversified. Then, you know, this is, we don't even want to speculate on that internally. It varies from country to country in segment to segment. So, you know, the risk mitigation for severity turbine is to approach all. Oh, and, in case of sugar distilleries in India, have we, are we seeing any pick up further from the existing levels, or is it? Sorry? There is. Okay. So would you expect a 521 to be better from a sugarcillary sector kind of, you know, perspective? It could be in terms of what has it's not very substantial, but it it will be at about the same if that's actually better. You see, the turbine component is not a very, very large megawatt. Okay. Thank you. Thank you. The next question is from the line of Laila Ram Singh from Ygrene Securities. Please go ahead. Good evening, sir. My first question on domestic market, do you see any signs of improvement from the core sectors like Siemens, Steve? Yes. Yes. The good traction and we keep recovering cement. I see. Okay. But greenfield is still a long way ahead. Yeah. Yeah. The the the but this is, this is quite good. I mean, the the this is free of capacity. And this is something that are more, you know, we feel they take a long time to plan and by the time the financing and all. We don't even put that into the inquiry comes, it doesn't mean you know, it's an active advisory. But these are things that the customers act on very quickly. But for them, the ROI is quite fast. So within this state, a cement is doing well. Even in scale, do you see positive or more traction? Yes. That's what you see. We had keep the company. What we're saying is that the company for the, the ROI for the person is, is quite good. So why is it why cement? Maybe they're not thinking of big brownfield expansion or greenfield expansion. This is a this is a small small brown This is a sort of a balancing balancing, pollution control, cost, So it so it's it's it's it's it's because it comes into big field, you know, for for the lifetime companies, this is small, CapEx. Okay. And is my understanding correct that steel has a lower penetration of waste heat, you know, compared to a cement? Oh, the other way around. No. They do already. Other way around, sir. Cement has a very low penetration fee. Yeah. So we're having more potential coming in. Okay. Got it. Got it. Thank you. 2nd question is in the gross margins. This quarter, we have done around 48% we have seen good improvement over the last four quarters. So, do you foresee the gross margin to stabilize at these levels or, Yeah. That's the correct statement. Okay. And we have also, made very conscious effort to control the and I see that it has been pretty constant, over the last four quarters. So do you believe, are we doing any, or the employee base, has it gone down or is it constant? Because I don't see any of the expense going anywhere over the last 4 to 5 quarters. No. We are looking at it very, you know, we look at cost to a degree level, you know, moving around and and a risk in it, etcetera. But from a total overhead perspective, we have put a lot of control and focus on on administrative expenses that include travel. You see, unlike like the chairman is saying international, uh-uh, marketing is being handled largely by Bangalore. So those will then reflect on the administrative costs and you also then have other overheads. So we're tightly controlling matters. People, we have always need to expand the higher value added segments such as design engineering R and D, and we keep expanding, our personnel there. But we rebalance, our requirements data based on the situation as it exists today. But had you known that the OpEx is still fairly confident? Yes, that is my comment. So we want to keep this DNA, it's going to make it a little better. Sure. Next question is on the oil and gas business. You said that's the accretive business and that was because of its repeatability or lower, product lifecycle, that is, you know, we had more, if we don't know, it's because of profitability. Both. Okay. And why is profitability higher there? Is it lower competition? Or Yeah. I mean, exactly at higher certifications. Okay. And what would be the motivation of the client solve customers to switch to the lower cost? Where and the design infrastructure, infrastructure, and the other we are big global player in the esteemed turbines. And so why would we not have the same expertise then? And lastly, it's I think we have an edge over others in service. No. But given that we have been in this business for last more than, I think, I mean, many years. So, why did it take so long? I mean, is it because of a switching courses there, which took us so much time or run. There is there is a huge, R and D cost to get it. And a huge qualifications, you know, to get registered with these companies is a long process. They have a very, very, you know, Kuwait National Oil Company, and I'm calling on, I'm not easy to get registered with. Okay. So going forward, if I take a IV review, is it, fair to say that this part of the business can be, like, 15, 20% of the overall business? Well, I'll be I'll be available. We're going to have some brainstorming. It's a useful point you've mentioned, but certainly, could we even be out Actually, you know, once we have a few more breakthroughs, I would say that's not a conservative figure. That's the easy figure. Great. Great. Can I ask one more question, please? Fine. Within Southeast Asia, what is driving the demand which you are saying? The inquiry has been positive. Which she's a sectors of process industry, biomass, waste to energy. Foreign municipal waste and sanitation waste to energy. Wait. Where is he? And the process industry are also still, all the it's just like the cement plants and, you know, what's happening domestically. I'm having the small power, additions they're doing, and the returns are coming. Okay. And Europe, it is mostly renewable. Is it biomass. Okay. Thank you, sir. Thank you. Thank you very much. The next question is from the line of Katie Jain from Sundaram Mutual Fund. Please go ahead. Hello, sir. Sir, I'll uh-uh, sir, congratulations on good margin performance, sir. Thank you. Yeah. So secondly, on this super distilleries, are the ordering instructions, sir, to come to us? I'm sorry, sir. I didn't hear that. Sorry? Yeah. Sugar history, which had to be set up in the Maharashtra region, have this attempt to come up here and Yeah. We're calling my house. No. That's good. You're still in my my house. Are we getting any We are getting orders and they're from all over the country. Not not necessarily one area. That we are getting, not we are getting. All of us. There is there is no specific They're being executed also. And that these are typically, 4 to 8 megawatt hours. Okay. So how is the potential going forward, sir, in the next year, sir? I think I've already mentioned that quite in detail, both in the international sphere, and also given you the strong inquiry base that we have. So it's very positive in terms of order bookings for next year. And if that is what your question is. So and that is the growth potential for the balance part of FY21 and going into 22. So we really look at order booking and, that looks okay. Okay. Sir, lastly, sir, when we see our backlog, it's a 6 24 crores And, during the one of the earlier questions, you had highlighted that, our aspiration is to be flat on a way that 723 crores kind of number if we see and assuming even a flattish group, flat number by your way, which will mean 2.80 crores of revenue. I mean, order flow ask, sir. Isn't it challenging that, sir, for Q4? It would be a it is challenging. It is challenging. You you've done the math. Right? But we're looking at both aftermarket and products in Q4. But okay. So we consent to, I mean, do around that service. But, you know, let me tell you, it's supposed that we get it in end of March or it goes into 1st week of April. You know, the the the spreading out of quarter to quarter is is good. You know, the, we have to show the visibility going out into H1 of next year, not just the, And the second thing, let me tell you that the execution period of water varies from 3 months to 14 months. So, it's it's it's we really look at picking up orders to fill in the, the the umbrella requirement. Okay. Sir, g JV has been profitable on a YTT basis. How do you see, for next year, sir? I, we we are we are looking at the business's normal. Okay. No. Like, last year was lost. Like, next year, also, will we be profitable company, sir? Like, last year. I mean, we expect to, but I'd say normal if we've been showing profits There's no reason why we shouldn't do that again. Okay. Good. Good to hear, sir. Thanks, sir. Thanks a lot, sir. Thank you. Thank you. The next question is from Anand Badani from Unified Capital. Please go ahead. I think we have. Hello? Hello? Yeah. Yes, sir. Sir, on oil and gas, we have been having a conversation on these calls. For 3, 4 quarters now. Yeah. Wanted to get a sense, as to how many, you know, companies in oil and gas space, have we kind of, applied? Oh, let me you know, if you go to one company, let's take, Petramina or Petronas. They have 2 different divisions. In the Orange County of Indonesia and Malaysia and Kuwait. So it's huge in each one. When they prequalify you, it's a very big thing because then they have to send you the inquiry. And it's an expensive process of them also, and the data is and the the verification and the diligence is, and, you know, these people that I am not on getting another person in. They're really not they said you already have to party, right, we want another one and it's it's you you you need a lot of perseverance and, our Middle East office is, doing a lot in that. So so is our Southeast Asia office, they concentrate on that. Yeah. So currently, you mentioned Middle East And Southeast Asia, you know, offices. We are not putting any efforts in the US market. You're good point. We are thinking of now. Okay. And in the Middle East And Southeast Asia, as of today, do we have any approvals to be a pre qualified vendor? Yeah. Okay. And, would it be, like, fair to say that if you have maybe 2 or 3 approvals in by the end of FY 2021. So next 15 years, maybe 2 or 2 or 3 approvals in it be a good situation from our hospital? Would it be undershooting or overshooting? No. I would want more. Okay. Okay. Good, sir. Good luck. I'll come back and meet you for any additional questions. The next question is from the line of Lala Ram Singh from Ygrene Securities. Please go ahead. Sir. Sorry about my ignorance, but may I know what is the issue in Turkey? Is the general situation and the economy there, the people that put their projects on hold. So this is a a recent phenomenon or has it happened, over the last 12 months, last 16, 15, 16 months? You know, the the you'll you'll be reading about it. So we we the the the product, we're not lost the product, but they've just been put on hold. Okay. Okay. Got it. Got it. Got it, sir. Thank you. Thank you. We would like Okay. I think we've, somebody locked it up. As there are no further questions, I now hand the conference over to the manager Thank you. Thank you, everybody. Thank you very much for the very interesting questions. And, I'd like to end, as we started, the call that we've had an exceptional 9 month, performance. And going forward, we're very encouraged with the inquiry pipeline, the order on hand, the geographical segments that we've been able to, at attack, in, and, you know, we've talked so much about, oil and gas and deep travel and the Southeast Asia and Middle East areas in Europe. And so we look forward to a to a bright future in not just in the last quarter, but in FY 2021. Capacity is is is bad. Technologies have now, in the front line, and we feel that we are service element is is really a very big distinguishing factor, for the venue and and its competition and also for the bottom line. Thank you. Thank you very much members of management. Ladies and gentlemen, on behalf of Trinity Turbines, that concludes today's conference call. Thank you all for joining us, and you may now disconnect your lines.