Ladies and gentlemen, good day, and welcome to Dilip Buildcon Limited Q2 and H1 FY 2025 post-earning conference call hosted by S-Ancial Technologies . As a reminder, all participants' lines will be in the listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing star then zero on your touch-tone phone. Please note that this conference is being recorded. I now hand the conference over to Ms. Jill Chandrani from S-Ancial Technologies . Thank you, and over to you, ma'am.
Thank you, Neha. Good morning, everyone. Welcome to Dilip Buildcon Limited Q2 and H1 FY 2025 earnings conference call. From the management, we have with us today Mr. Devendra Jain, Managing Director and CEO; Mr. Rohan Suryavanshi, Head Strategy and Planning; and Mr. Sanjay Kumar Bansal, Chief Financial Officer. Before we begin this call, let me mention the standard disclaimer. The presentation that we have uploaded on the stock exchange, including the interaction in this call, contains or may contain some forward-looking statements concerning our business prospect and profitability, which are subject to some uncertainties, and actual results could differ from this. Now, I request the management to take us through the brief remarks, after which we can open the floor for question and answer session. Now I hand over the call to Mr. Rohan Suryavanshi for his opening remarks. Thank you, and over to you, sir.
Thank you, Jill. On behalf of Dilip Buildcon Limited, I welcome all the participants in our Q2 and H1 FY 2025 results con call. The results and presentation have been uploaded on the stock exchange, and I hope all of you had a chance to look at it. At the outset, I would like to share some industry updates, and then I'll touch upon the company. The infrastructure awarding activity in recent months has seen some deceleration. However, we anticipate a pickup in the near future, fueled by several initiatives like the PM Gati Shakti. Ministry of Road Transport and Highways has outlined a remarkable goal for FY 2025. In the Union Budget 2025, the government had high aspirations for the infrastructure sector with a view to making it a powerhouse in our economy. Road and highway transport was allocated INR 2.78 lakh crores.
Despite a slow start this fiscal year due to election season and model code of conduct and the various ministries getting set up in place, MORTH is committed to finalizing these contracts as confirmed by the honorable Union Minister. The honorable minister has stated that India will achieve the highest-ever highway construction level this fiscal year, so we remain optimistic. As of August 2024, around 700 kilometers of projects were awarded, while 2,700 kilometers of national highways have been completed. Although this is lower than last year's pace, we expect a significant uptrend as awarding activities regain momentum. Another noteworthy development is MORTH's ambitious $1 trillion investment in 74 new highway tunnels, tunneling to 73 kilometers. Notably, 35 tunnels covering 49 kilometers have already been completed, and this sustained focus on tunneling is poised to unlock further growth opportunities for our company.
In other infrastructure news, in FY 2025, Indian Railways has allocated INR 1.74 trillion for infrastructure, facility upgrades, and safety enhancements. Similarly, Coal India Limited is advancing 119 projects, adding 896 million tons in annual capacity with INR 1.33 lakh crores using advanced technology for productivity and sustainable mining. Even from an outsider's perspective, according to Morgan Stanley, investments in India's infrastructure are projected to grow at an impressive 15.3% CAGR over the next five years, amounting to an estimated $1.5 trillion in cumulative funding. This investment wave will significantly boost India's growth trajectory, reinforcing its position as an emerging global economic powerhouse. Now coming to the sector and the company. During the quarter under review, ordering activity was weak across all sectors, which was expected because of elections, but now it is expected to pick up going forward.
Just like in the past year, quarter three and quarter four specifically get heavy orderings. On the back of our strong order pipeline and our presence across all infra segments, we are expecting a good order flow in the next few months. Currently, over INR 1 lakh crores of NHAI and MoRTH orders are already floated and expected to open in this financial year. In this, there is about 70% HAM and 30% EPC. Besides these road orders, company is also looking at opportunities in other sectors where we are evaluating orders of INR 90,000 crores. I am happy to announce that we got our first breakthrough in optical fiber laying business by securing first order of BSNL in partnership with STL of about INR 1,625 crores. In this order, our share is about 70%.
Also to update, as we mentioned last time, there were certain challenges in the JJM project money coming through. We still continue to face those challenges, even though it is of an improvement trajectory, but the situation has still persisted in this current quarter as well. We are expecting more improvement in release from this quarter and onwards. Now, in continuation of our vision of DBL 2.0, I am happy to report that our long-term revenue-based business is growing at a fast pace. This translates in the charges predictable free cash flows, improving return ratio, and zero debt on a standalone basis. So when you look at DBL going forward, you will have to look at the consolidated numbers to get a better perspective. Even in this quarter, we have achieved the highest-ever quarterly PAT on a consolidated basis. Our focus is to keep increasing this.
But in the same breath, if I have to give you guidance on the standalone revenue for this year, given that the order inflow has been weak till now, we are expecting a de-growth of around 10% in FY 2025. The EBITDA margins are still expected to be in the 11%-12%, as we had indicated earlier. However, the consolidated margin will be higher than last year. Let me reiterate that. That the consolidated margin will be higher than last year. The debt reduction guidance on a standalone basis for this year may change slightly because of lower revenue and lower order inflows. But it will still be reduced from the past year debt. So the key takeaway here is that DBL is still focused on being a net debt zero company, as we had indicated earlier. Even if the timing is postponed by six months or so.
Our target still remains the same. Now, coming to our investment portfolio of HAM assets. I am happy to inform that recently we have fully concluded the Shrem InvIT deal with transfer of 51% equity stake in the last project. With this, our entire deal with Shrem is concluded, and we will continue to do the O&M of their assets for the live duration of those assets. This provides us with a long-term assured revenue stream, and this O&M revenue stream will keep on increasing as our own InvIT asset pool keeps getting larger in size. To talk about our own InvIT as well, and to give you update on that deal with Alpha, we are progressing as per the plan. Till now, we have transferred 26% stake in seven assets out of a total deal of 18 assets. These seven assets have received COD, and the annuity has started.
One more asset will receive COD in this month, post which it will also be transferred to Alpha and eventually to the InvIT. This will conclude the first tranche of Alpha deal. Our InvIT formation process is also progressing well. We have received SEBI approval for forming public InvIT. Now, coming to our core business. Our coal MDO business is on an accelerated execution path. I am very happy to report that we have achieved production of 10.2 million metric tons in the first half of the year, as compared to our target of 22 million metric tons for the full year. We are also confident and on track to beat this target by at least 10% to 15%, meaning we will end up doing this year with almost about 25 million metric tons of coal production.
Now with this update, I would like to hand over the call to our CFO for the financial overview. Thank you.
Thank you, Rohan. Good morning, everyone. I welcome all our stakeholders to our earning call for the quarter ended 30th September 2024. Let me present the standalone and consolidated results of Dilip Buildcon Limited for the quarter and half year ended 30th September 2024. On standalone basis, on year-over-year basis, revenue decreased by 10.3% to INR 2,177 crores against INR 2,427 crores in quarter two FY 2024. The EBITDA decreased by 24% in Quarter 2 FY 2025 against INR 294 crore EBITDA in quarter two FY 2024. Profit after tax increased by about 8% in quarter two FY 2025 to INR 129 crores against INR 120 crores in quarter two FY 2024. Now, let me update on the consolidated performance of Dilip Buildcon. The revenue on year-over-year basis decreased by 13.6% to INR 2,461 crores in quarter two FY 2025 against the revenue of INR 2,849 crores in quarter two FY 2024.
The EBITDA increased by about 47% in quarter two FY 2025 to INR 500 crores from INR 340 crores in Q2 FY 2024. This is mainly due to better performance of our MDO business and completed six HAM projects at the end of September 30, 2024. The PAT is also increased by 263% to INR 266 crores in quater two FY 2025 against INR 73 crores in Q2 FY 2024. The consolidated performance for half year basis, year-over-year, so the revenue decreased by about 3% in H1 FY 2025 to INR 5,595 crores from INR 5,769 crores in H1 FY 2024. The EBITDA increased by 33% to INR 977 crores in H1 FY 2025 versus INR 734 crores in H1 FY 2024. The PAT increased by 374% in H1 FY 2025 to INR 406 crores from INR 85 crores in H1 FY 2024.
This increase in PAT by 374% is mainly due to the better performance of MDO business, completed six HAM projects, and exceptional items of INR 158 crores. Thank you all, and now we can open the floor for questions and answers.
Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on their touch-tone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handsets while asking their questions. Ladies and gentlemen, we will wait for a moment while the question queue assembles. Participant, you may press star and two to ask a question. The first question is from the line of Kunal Ochiramani from Kitara Capital. Please go ahead.
Hi, sir. I just wanted to ask, like, you told you are evaluating some orders of INR 90,000 crores in other sectors. We are well-diversified. How to look at your company at five years perspective as to how will we gauge the order book, and as our realizations, or let's say the conversion is going down this year, there's a dip in revenue this year. How do you see it in next year and next year up?
Kunal, a great question. When we are looking at DBL five years down the line, how should we then start to look at the company? I think there are two distinct ways that you will have to look at the company. One is DBL as a short-term revenue and DBL on the long-term revenue basis that I have mentioned. The short-term revenue will be the EPC projects that we do. These are typically two- to four-year timeline projects. This DBL will continue to do because of all the inherent engineering and execution capabilities that we have built for the last few years. We have our own equipment bank, our own people, all the credentials, and an experience of having worked in all around 22 states now.
We will be continuing to do work in all those states in all the sectors that we are already doing, and we may also add some more depending on what new opportunities are presented by the government in the country at that point of time. We continue because at the end of the day, the trick, or I guess the biggest thing of doing any infra project is the execution capability, and where we are very confident of being able to manage all those nuances of a project very well. That will be one part of the DBL that will continue to keep growing. The second pie, which we mentioned, and which will set us apart in the sector and in this area, is that we are focusing on a long-term revenue business model as well.
There will be an increasing share in both our revenue and more than that, our bottom line from the long-term business. The two pillars of those businesses will be, one will be the coal business, where four or five years down the line, we will be possibly the second largest, maybe after Adani, in terms of the coal production that we do, because we will be doing almost 60 million metric tons of coal production by that time. Currently, in this year, we will do about 25 million, but at that time, we will be doing about 60 million metric ton of coal production, which will give us a clear revenue of about INR 3,500 crores to INR 5,500 crores of revenue coming from that sector. This is without accounting for new projects that we are already bidding for.
I am just talking about the current order that we already have. When I say 60 million metric tons of coal production, this accounts or amounts to almost 10% of the Coal India current production. That is the scale of operations that DBL will be doing that and as we add more mines to it, this will keep on increasing. The second bit of this long-term revenue pie will be our InvIT business, the one that we are setting up with Alpha. The 18 projects that we have already committed there already gives us about equity valuation of our 74% that we will be holding of about somewhere in the range of INR 4,000 crores, which will give us INR 400 crores, INR 450 crores of cash flow every year.
This in the next five years will also increase because we will add more HAM projects of our own. Also, the InvIT will be procuring more assets from market. So our revenue from that will also keep on increasing. So if I look at a five-year down the plan, my two large fixed businesses alone will be throwing out an EBITDA of more than INR 1,500 crores easily when I am talking about the coal and just our InvIT business. Besides that, whatever revenue we will do on the standalone basis will again, let's say, even if you are doing some INR 8,000, INR 10,000 crores of revenue, let's assume at the same current ratio. Again, if you imagine 10%, 12% of EBITDA, it will again throw out that additionally.
We will have not only increased that bottom line, but we will also have very predictable and assured long-term cash flows, which in this sector and this industry is difficult to find. So our learning after COVID was, we want to build an institution where there are long-term predictable cash flow, and we can continue growing that business year after year. So that was the idea, and that is where we see ourselves in five years from now.
As to how we see as the company is, when we value or when we see our coal business and InvIT business is fairly estimatable, that we can estimate and we can arrive at a value, or we have some visibility on the business. Can you comment something on EPC side as to how will our order book grow, or some internal estimates you guys see that at least 10% or some ballpark number you have in mind?
DBL in the past was obviously known for a faster growth phase, where we were also investing a lot in both our bank facilities and also investing in equipment. Going forward, as we have indicated, we are going to be targeting a growth of 5% to 10%. So that is the growth rate that we will continue to target. Now, when it comes to a five-year plan around what are the businesses, that question is better asked to the government because they are the ones who have planned out. They have laid out a vision. If you look at the last 10 years of this government, they have kept on increasing the infrastructure budget year on year. When in 2014, the total infrastructure budget was about INR 2.5 lakh crores, or somewhere in that ballpark.
Last year, it was about INR 11 lakh crores. This financial was INR 11 lakh something crores. This pie will keep on increasing. As this pie keeps increasing, our business should keep on increasing, as we have also gone into different sectors. That is how it will look, sir.
Okay. Thank you so much.
Thank you. Ladies and gentlemen, you may press star and one to ask a question. The next question is from the line of Shravan Shah from Dolat Capital. Please go ahead.
Hi, sir. Thank you very much. Sir, just a couple of questions on your construction part. You have explained very well on the MDO and the InvIT part. First is this BSNL order. What would be the 70% EPC value excluding GST for us?
Shravan, the total order value is INR 1,625 crore, and we have 70%, about 75% work basically allocated to us. This value is basically construction, and thereafter, around seven years, there is an O&M also. So there will be additional revenue from O&M also, which is not included in INR 1,625 crore.
Okay. So here also the 18% GST is there?
Yes.
Okay.
This is excluding GST, sir. This number that you see, 1,625, is excluding GST.
Excluding GST and the O&M value, which is about 925 or something,
975 crores. About INR 1,000 crore of O&M will also come.
Okay. Sir, you have mentioned that is including the GST; INR 1,625 crore is including GST.
No. I don't think that including GST.
No issues.
Our DBL part is 70% in the execution and the O&M. So O&M is also INR 975 crore above the INR 1,625.
Okay, got it. So now broadly, in terms of order inflow for this year, you have highlighted even 90,000 crore tenders you are evaluating. If you can also help us in terms of sector-wise breakup, which are the segments, and also road also, if you can help us, what's the pipeline and what we are looking at? Net, INR 1,100 crore plus this INR 1,200 odd crore. So kind of a INR 2,300 crore kind of order inflow that we have already received. How much more we will be looking at for this year? INR 15,000, INR 16,000 crore last time we said that we are looking at in terms of inflow. And also just to clarify out of this, are we also including the MDO mining inflow that we normally take for three year kind of a revenue.
That is also included in this, whatever the full-year order inflow we are looking at.
Sir, when we speak about new order inflow, when I readily mentioned INR 15,000-INR 16,000 crores, that means the new order that we are targeting this year. It doesn't include what have already we won, number one. Number two, the target remains to be in that zone only, that INR 15,000, INR 16,000 crore target that we mentioned. I obviously can't give you a break-up of all the sectors, like a piece by piece break-up of all the sectors how you were expecting. But the current sectors that we're working in, these orders are in all those sectors, and we are looking at those orders. That's the key takeaway. Even in the past, we've never given a detailed break-up of each sector. The road sector we do mention. The other sectors we give you an overarching picture, and that we are bidding for these projects.
That's what we are trying to do here also.
Okay. In terms of the debt reduction, sir, just to get more clarity, so we just increased close to INR 700 crore plus in 1H at a gross level. So how one can look at from now onwards how much more reduction we are looking at by March end, and in terms of the net debt free by FY 2026, so that remains intact?
Shravanji, the debt is primarily increased because of the working capital changes, especially the delayed receivable from JJM projects and the accumulation of the GST and CGST credit. We have faster paid to creditors. In all, we have basically invested in working capital around INR 700 crores, and corresponding debt has increased. In terms of debt reduction, Rohanji already detailed in his speech. Rohanji, please.
Shravanji, like I mentioned in the speech as well, our target still remains to reduce debt. While we will be able to achieve the earlier number that we have done or not remains to be seen. We are optimistic. Even though if we rationalize it a little bit to take a prudent sort of look at things, we will reduce the number of debt. The amount of total debt will be lower than last year's debt. That is for sure. Even though it might not reduce to the level that we earlier thought it will, and primarily it's because we didn't get the orders that we thought we will, which would have culminated into revenue and improved our margins. Number two, when you get new orders, you also get the mobilization advance which culminates into changes of the older projects where mobilization advance is getting cut.
There is always the sweet spot which continues going there. That's why.
Shravanji, let me add to what Rohanji said. This is a temporary phenomenon. Our debt-free company, the estimates are intact. What we envisaged in past, the company will be debt-free on the similar lines.
Okay. Are we saying that we can be net debt-free by even FY 2027 and may not be in FY 2026?
Yeah. If not FY 2026, FY 2027. So FY 2027 is where we will do it. So FY 2026, there is a postponement of this trajectory that we had started on because of things which are outside our control. The lower order inflow that came in and all of that, and revenue that got hit. But the trajectory still remains the same. There is no plan to change this or do anything else. The trajectory you will see year-on-year happening.
Okay. And what was the DBL Infra debt? Was it the similar 650 crore around September?
Yes. So the net debt at DBL Infra asset level is INR 645 crore.
Okay, got it. And broadly, in terms of whatever we are looking at, 400, 450 odd crore in unit inflow to the as a dividend plus interest and everything. How much broadly, so this 1H, how much we have received at standalone level? And if possible, how much more we are looking at in the second half and then maybe FY 2026, if you can help us there?
Shravan Shah, the total inflow what is projected to be received from the overall unit holding in Shrem InvIT unit is around INR 95 crore. Out of that, around INR 45 crore has been received, and it is in 60-40 ratio, 60% in DBL, 40% in infra effect.
Okay, got it. And this Alpha Alternatives will start from FY 2026 onwards only?
Yes.
Okay, got it. And just to recheck in terms of the CapEx, just the INR 46 crore we have done so for full year. At standalone level, how much we can look at?
Shravanji, the total CapEx in FY 2024-2025 would be around INR 150 crore. Total INR 116 is already incurred.
Okay, got it. And sir, when you say now we got the SEBI approval for public. Does that mean that it will be listed on the stock exchanges?
This is trust approval, and the lawyers and the bankers are creating the documents. It will be filed once ready. Our plan to launch the InvIT will remain intact.
Yes, it will be listed on the exchanges, sir.
Maybe six months down the line, one can look at this will be listed?
Yeah. six months or so, sir.
Okay. Got it, sir. Thank you, and all the best.
Thank you. The next question is from the line of Deepak Purswani from Swan Investments. Please go ahead.
Hi. Good morning, sir. Sir, just wanted to check with you on two questions. Firstly, on the net debt front, we mentioned it has got delayed by one year, and we are looking at net debt free by FY 2027. What is the expectation by end of FY 2025 at the current juncture now? Earlier, we were saying it would be around INR 1,000 crore. How should we see this year we would be closing it out. Hello.
Deepakji, the net debt at end of 2024 was INR 1,515 crore. Today, the debt is increased because of the delayed distributable. We are expecting some relaxation, so there will be a reduction in FY 2025 end, but we cannot permit a higher number, but it will definitely be reduced from the level which we had on March 31, 2024.
Okay. Secondly, it is good to see there is a sharp ramp-up in the MDO business. I think volume on the overall basis has increased to 10.3, which is close to last year volume in the first half itself. If you can also share the revenues and EBITDA, how much has been the total revenue from the MDO business in the first half, and what has been the EBITDA?
Deepakji, we do not share the entity-to-entity EBITDA. I detailed out in my presentation. The increase in console performance is because of these factors: the MDO business and the completed MDO projects.
Okay. In terms of the further ramp-up in the production of MDO, how should we look into the full year as a whole now currently, and what should be the expectation over the next two years for the MDO business?
There are two MDOs, Siarmal and Pachhwara. Pachhwara, there is a fixed production of 7 million tons we will be achieving this year, and the 7 million tons will continue for 55 years. The performance that we will do this year will continue for the next 54 years. In terms of Siarmal, this year, originally, we have indicated the target by 15 million tons, and as Rohanji detailed out in his presentation, we will increase this production by 10% to 15%, meaning 17, 18 million tons this year. In total, it is 24, 25 million tons this year, MDO business. Next year, it will rise by another 10 million tons. In FY 2028, we will be doing 60 million tons, as Rohanji said.
Okay. Thank you. Thank you, and wish you all the best.
Thank you, Deepakji.
Thank you. The next question is from the line of Narendra from Robo Capital. Please go ahead.
Hi, sir. Thanks for the opportunity. Am I audible?
You are audible.
Sir, earlier, if I am not wrong, you had guided for a INR 15,000 crore kind of order inflow. Are we still expecting that?
Yeah. We have guided for an order inflow of INR 15,000 crore this past year. I mean, for this financial year.
Sorry, sir, I did not get you. Sorry.
You are saying we have guided for a INR 15,000 crore order inflow, right? That is what you asked for? Yes, we have guided for that.
Are we still on track or do we see some softness?
Yeah, we are optimistic on that number because the larger orders have not been bidded out. We are bidding for them. We are already sort of working on those orders. Like I mentioned, there is almost a INR 2 lakh crore order pipeline that Dilip Buildcon is currently evaluating. We are fairly optimistic that we should be in that range. Out of that INR 15,000 crores, we have already won orders about INR 3,000 crores till now. There is INR 12,000 more crores that we need to win.
Okay, great, sir. On the margin front, sir, there was some softness this quarter. Was it due to the seasonal nature, or what was the reason, and are we optimistic for that 11%-12% kind of margin?
Yeah, the margins were soft because of seasonality and also because of lower execution. However, we have guided towards an 11%-12% margin only for the year, keeping in mind some of these things. That is how you should look at the year on a standalone basis.
Okay, sir. Would it be possible to give a light on the margins in the MDO project that you are doing? What would be the ballpark number for margins there?
Sir, we don't share margins sector by sector. We only share the company margins.
Okay. You mentioned that you will be getting around INR 1,500 crores of EBITDA of these long-term projects, right? The InvIT and the MDO project, right? You did mention that.
Yeah. We have mentioned those three, like the two items, the inflow from InvIT and the MDO business. You are right.
Thank you so much, and all the best.
Thank you. Ladies and gentlemen, you may press star and one to ask a question. The next question is from the line of Vaibhav Shah from JM Financial Limited. Please go ahead.
Sir, you have guided for a 10% decline in terms of revenue for FY 2025. Given the lower base now, can FY 2026 see a better growth, or it should be in the range of, say, 5%-10%?
Yes, sir. Obviously, it will change because we will have the orders that we have guided for. Once that execution starts, there will be a ramp-up in revenue.
Any particular guidance from your end in terms of revenue growth?
Sir, I think to give you a better perspective on that will be when end of the year we are sitting with the order book and where we are exactly. We will give you a better precise number rather than shooting in the dark right now with still expecting for orders.
Okay. And over the longer term, say two to three years, our margins should be in the range of 11%-12%?
Yes, sir. Easily it will be in that 12% and all. It will be there.
Okay. Thank you, sir. Those are my questions.
Though we should look at the console numbers going forward, like we mentioned, because all of it will not be captured on the standalone, the margins that the company will be making. We should start also paying closer attention to the console numbers as we go forward, sir.
Okay. Thank you, sir.
Thank you, sir.
Thank you. The next question is from the line of Saket Kapoor from Kapoor & Company. Please go ahead.
Yeah. Namaskar, sir, and thank you for the opportunity. Sir, firstly, if you could explain to us the BharatNet project, which we had bagged in consortium with Sterlite Technologies, the scope of work here and for the O&M part also, the proportion of 70/30 holds good?
The scope of work there is the trenching and laying of the cables. That is what we will be doing in execution, and it will be dealing with the same and O&M.
Sir, I missed your point. Come again, please.
Sir, it is the trenching and laying of cables and the O&M of it.
Okay. And in the O&M also, the 925, 70/30 ratio prevails similarly?
Yes, sir.
Okay. But, sir, taking into account the realm of things and the space where we are, what drew us to this INR 1,800 crore order in a totally different field altogether? All those are, I think so we bidded for eight of the packages, but we were awarded one. So if you could just give us some color on the experience that we have garnered from this type of participating in the project, and how does it make that a significance for us to diverge into these businesses or this line of operations?
Sir, obviously, we and Sterlite Technologies had bid for all the packages. Unfortunately, we did not win more. So our idea was to obviously do a bigger portion of this. Now, coming to what is the work and expertise, this is a very simple job compared to a road business or any other infrastructure business that we do, whether it is metro or tunneling. All of it is far more engineering-wise, more complex. This is a simple trenching, digging up of a hole and then laying that. So we already have the equipment for that and manpower.
So it's a very simple job that we'll be doing, and this kind of stuff we already do on our road projects and all. So it's a very simple sort of project execution where we already have all the equipment and people. So that's why we were doing it along with this Sterlite Technologies.
Sir, when we look at being one of the MDO operators for the coal mine part, how many players have been garnered that project? Or are we simply operating the mine?
Sir, I did not understand the question, sir.
Sir, I was trying to understand whether in the coal mine part also, there are a lot of players operating in MDO, or are we the sole PSPCL?
Sir, there are people in the coal business as well. They are very separate than what we see in the road business. There are separate set of players in the coal MDO business because it has a different set of challenges. So there is different competition there as well.
Sir, I did not get the point. Sir, I was asking that as an MDO operator for the mines where we are operating, and we are also alluding to the fact that going ahead, we will be the second largest MDO operator for coal mines in India after Adani. So in this project also, we are garnering the total output for our client as a single person, or here also we have form a consortium, and we are sharing a part of it?
Vaibhav, we said we have two MDOs, one 50 million tons every year and 7 million tons every year. It makes 57 million tons. Today, we have two principals only. PSPCL for Pachhwara and NCL for Siarmal project. These two will be achieving about 60 million tons. There are other set of MDO players in market like Adani and others. There are few people working in MDO segment as well.
Okay. And sir, what explains the increase in capital work in progress at a standalone number also? If you could give the breakup for the console part also, the capital work in progress figure.
In terms of capital work in progress in console, first standalone basis, it is INR 80 crore. This is part of our INR 150 crore total CapEx this year at standalone level. In the SPVs, the HAM SPVs, the capital work in progress is HAM capital working progress and one part of MDO. In Siarmal, we have capital work in progress for the project CapEx, which is already approved by the authorities.
Okay. Lastly, sir, we have also heard from BSNL, in fact, that one of the tender participant has even approached the court to challenge the tender process, having unfair practices. Are we aware of this? This is a notification from BharatNet, from BSNL itself, dated yesterday, November 13.
So, Vaibhav, we are not aware about any objection made by any participant in the tenders.
Okay. Thank you, sir.
Thank you so much.
Thank you. The next question is from the line of Rishikesh from Robo Capital. Please go ahead.
Yeah, hi. Thank you for the opportunity. Sir, in the last call we had shared that we were going to receive around 477 crore from Alpha during this year. But it looks like the timelines have been shifted to FY 2026 and 2027. Would like to know, is there any possibility for these cash flows to go beyond FY 2027 as well? Or are we fully confident that we will receive these cash flows in the said timelines?
Let me correct. Basically, the last quarter presentation, 477 crore was shown from the eight assets. Balance five assets we have said 477 crore will be received. Out of that, only 61 is pending. Refer the line on page number 28, only from eight assets. And the another line is added for the another 10 assets, 26%, which is 550 crore. That 10 assets is still not complete. Once the asset will complete, this 550 crore is additional to the 477 crore. Out of 477 crore, only 61 is pending. Other, already received.
Okay. So we are saying that around 400 crore has been received, basically.
Yes.
Okay. My bad. Okay, got it. Thank you very much.
Thank you. The next follow-up question is from the line of Shravan Shah from Dolat Capital. Please go ahead.
Sir, I just wanted to check when we are saying our net debt, even if we are saying some reduction will be there on year-over-year basis. So that means close to INR 800 crore kind of a reduction that we are looking at in the second half of this financial year. So can you help us how this will be done?
One is basically, we are expecting the unlocking the working capital, what we invested in subject HAM. So it is basically the JJM project and the TDS and the income tax refund. So basically, the original position will be restated by March 31, 2025 and further reduction from the operational cash flows. So we said from the FY 2024 level, there will be slightly reduction as of March 31, 2025.
Okay, got it. So in terms of the 1H, in terms of standalone, the finance cost is close to INR 242 odd crore. So INR 120, INR 122 crore quarterly. So at least for next two quarters, the similar run rate will be there?
Shravan Ji, I would say little bit relaxed from the first half. Not very significantly down, but yes, it will be in the range where we are in H1.
Okay. And sir, in terms of the inventory days, obviously we are trying to reduce, but do we see that any material reduction is possible, that is even in next one, two years?
Shravan Ji, we are working for each and every balance sheet item. Yes, there will be a reduction in working capital days going forward. I can't tell you whether it will be inventory or debtor, but yes, there will be net working capital days will be reduced by some extent.
Okay. Got it. Thank you, sir, and all the best.
Thank you, Shravan.
Thank you. Ladies and gentlemen, you may press star and one to ask a question. The next follow-up question is from the line of Saket Kapoor from Kapoor & Company. Please go ahead.
Yes, sir. Thank you, sir. Sir, for the margin profile for the BharatNet project, can you explain to us how the margins will look like?
Sir, we try and bid all projects on the similar margin profile. So what we are indicating towards this project will also have that kind of margin profile.
This 11%-12% EBITDA margin is what we are eyeing even for the BharatNet project?
Yes.
Okay, sir. Since you mentioned that we have bid in consortium with Sunlight Group for all the projects, is this margin profile the key reason for so many people participating for these packages? Or what has led to you garnering only one of the same and not getting further, even though your partner has an expertise in laying of OFC cable?
Sir, we are also evaluating, but that is life. When you bid for a lot of projects, even on the NHAI roadside, we end up winning 5%-6% of the project that we bid for. Similarly, here also we had bid for enough, but we did not get, so it is just hard luck. It is the nature of L1 business, and that is how it works. Either you work on your margin profile or you reduce your margins and then you can get more orders.
Okay. Sir, you have also spoken about delay in receivables. Which government entity has delayed in releasing the funds, and in which projects?
Jal Jeevan Mission projects, the central government has not released their share to the states, which is why there is a delay. This is across many states. In fact, all states where JJM projects are going, the central government has not released its part. Only the state governments have been doing their part, which is why there is a build-up of the receivables from the government in these projects. This is across all players, across all states.
Okay. What are the reasons the government have highlighted for these non-compliance from their end? Are they not getting any milestone yet?
There is an increase in budget, but you are asking the wrong person that question. I think you should be asking the government that question, what are the reasons. I only know that there is an increase in budget, which is why they are evaluating how to, and restating the budget and getting more approvals there. That's the reason that I know. If there are more things that are happening in the background, I am not privy to that. You should definitely reach out to the government and ask them why has there been a delay in the payments.
Okay. Lastly, on the AMRUT 2.0 scheme also, wherein the river linking projects have also been showcased. In your bid pipeline, do you have the river linking project of the central government under the AMRUT 2.0 also, wherein we are participating, or we are keen to bid for?
Sir, whenever these projects come and they fit into our project profile and the kind of project we look at, then we will obviously bid for them. That is all I can say on that matter right now.
Okay. We have not exactly bid as of now for this river-linking project.
No, sir, we have not.
Okay. Thank you, sir.
Thank you, Shravan.
Thank you. Ladies and gentlemen, we will take this as the last question. I now hand the conference over to Mr. Rohan Suryavanshi for closing comments.
I thank all the participants to come and ask all the questions that they had. If anyone could not get their questions answered, feel free to reach out to our IR or our team, and we would be happy to give you more information on that. I look forward to seeing you guys in the next quarter, in the next year. I wish you all a great new year, and I hope all of you had a phenomenal Diwali. Thank you from everyone here at the DBL team.
Thank you. On behalf of Dilip Buildcon Limited, that concludes this conference. Thank you for joining us, and you may now disconnect your lines. Thank you.