Q3 24/25

Feb 3, 2025

Quarterly report

Summary

Q3 revenue rose 38% YoY to ₹1,271 crore and PAT rose 11% to ₹98 crore; the ₹23,877 crore order book supports management’s 20%–25% five-year CAGR outlook, alongside prospective naval awards and expansion in ship repair and exports.

Hello. Good afternoon, everyone. I am Gaurav Girda from Concept Investor Relations. I welcome you all to the analyst meet of Garden Reach Shipbuilders & Engineers Limited, to discuss its Q3 and nine-month FY 2025 results. I have with us today Cmde PR Hari, Indian Navy Retired, Chairman and Managing Director; Mr. RK Das, Director of Finance and Chief Financial Officer; and Shri Sandeep Mahapatra, Company Secretary and Compliance Officer. Please note, this conference is being recorded. Sir, over to you. Thank you, and good evening to each one of you. I actually look forward to this particular meeting, because this is the only time when we see each other, though we interact over the con calls every quarter. To be frank, I enjoy this particular session. Coming to the formalities, I welcome each one of you to this conference to discuss our financial performance for the quarter ending and nine-month ending 31st December 2024, and also to provide you a way forward, way ahead. I am sure most of you have been tracking the performance of the company, and you are clear about where we are. I will give you an overview as to what we are doing and give a glimpse of what lies in store for us. Like I normally do, I shall touch upon the financial performance, then cover the current order book, provide you the status of the ongoing projects, and then give you a glimpse of what are the projects on the anvil, and also highlight what we are looking for in the future. Coming to the financial performance, I think this is the 10th quarter on a trot that both top line and the bottom line have gone up. Our revenue from operations registered a 38% growth over the last corresponding quarter from INR 923 crores to INR 1,271 crores. The PAT has gone up by 11%, from INR 88 crores to INR 98 crores, and the operating profit has gone up from INR 37 crores to INR 62 crores. Its operating profit margin has gone up from 4.03% to 4.85%. Earnings per share, again, showing a rise from INR 7.70 to INR 8.57. Coming to what has translated to this financial performance is, of course, our physical performance. Before covering that, I will give you a glimpse of the order book. Our current order book, as in 31st December, stands at INR 23,877 crores, and this comprised of 40 platforms from 10 projects. These projects are, as you are aware, the three P17 Alpha, that means 17 warships for Navy coming from four projects, three P17 Alpha, two Survey Vessels (Large), two we already delivered, two more are remaining, so two Survey Vessels (Large), eight anti-submarine shallow water crafts, and four Next Generation Offshore Patrol Vessels. In addition to this, we are also executing a project each for the Ministry of Earth Sciences, an oceanographic research vessel, and also an acoustic research vessel for one of their DRDO organizations. We also signed a contract for six multipurpose vessels with a German client. We also have 2 more export orders for a friendly foreign nation. I am happy to inform you that we have won an order for 13 hybrid ferries from the Government of West Bengal. This is a World Bank-funded project. This, in a nutshell, gives you what are the orders that we currently have in our kitty. What we are looking for in the immediate future are the assured orders. Our agreement with our German client was for 8 ship multipurpose vessel projects. We had deliberately staggered the contract signing. Contract for 6 ships have been already signed, and we will be signing the contract for the balance 2 ships by 31st of March. In addition, we have been declared L1 for another set of research vessels for the Geological Survey of India, 2 coastal research vessels. The contract negotiations are currently in progress. We expect the contract to be signed by 31st March. That is our expectation. I have been talking about this next-generation corvette project for a long time. I think ever since I started attending these interactions, I have been talking about this project. Yes, the RFP has been issued. The bids have been submitted. 4 shipyards have taken part in the bid. The technical evaluation has been completed, and we expect the price bid to be opened in a couple of months. Let us together hope we become the L1 shipyard, because it is a high-value order, and that is something which we are eagerly looking forward to. This is what is immediately on the anvil. As far as the near future is concerned, Navy also has taken an Acceptance of Necessity from the Defence Acquisition Council for 7 P17 Bravo Ships. There is a follow-on of the P17 Alpha that we and MDL are currently executing. This is a 7-ship project, 3 shipyards in the frame, 2 of them will get it, so the probability is very high. Navy has also taken an AoN for 31 waterjet FACs. They are called follow-on waterjet FACs. These are small, 50-meter odd vessels, 31 of them. The volume is huge. Navy has also got an AoN for 120 fast interceptor crafts. In addition to that, Coast Guard has already obtained the AoN. That is the DAC AoN for 6 NOPVs and 18 fast patrol vessels. Next new generation fast patrol vessels. These are broadly what is likely to come out from both the Navy and the Coast Guard in the next 1 year. Some of the RFPs could come out as early as a month down the line. 2 projects that I missed, Navy has also taken AoN for 2 multipurpose vessels and 5 next-generation survey vessels. This is what I expect to come out from now till the next 1 year. This is the RFPs that I expected in the next 1 year. Now I will give you a glimpse of the status of the ongoing projects. As I had mentioned, we are executing 10 projects. I will start with the naval project, the P17 Alpha project. Again, happy to inform you that our first ship has already undergone the basin trials. Basin trials is a harbor trials, having successfully completed. We intend putting the ship to sea for the sea trials by end of this month. So the project is going on track. There was a question which was asked, I think last time or last time, "Is the project going on track? Will you be able to deliver the ship on time? Yes, we will be able to deliver the ship ahead of the contracted time. The first ship is to be delivered by August this year, the second ship by February next year, and the third ship by August 2026. We will be able to complete this project on scale. This is a high-value project. Just to give you an updated status, we are almost at 90% progress on the first ship, almost 65% on the second ship, and about 50% on the third ship. That is the kind of progress that we have achieved. Coming to the Survey Vessel (Large) project. This is a four-ship project for the Indian Navy. Two ships have been already delivered, and they have been commissioned into the Navy. Two more ships we intend delivering during this calendar year. Which means the third ship we expect to be delivering by June and the fourth ship by July, August. That is the way the progress is currently there. The second ship has almost touched around 85% the physical progress, and the third ship is around 72%. Coming to the ASW shallow water craft project. Actually, this is a 16-ship project, eight being undertaken by GRSE and eight by the Cochin Shipyard. Happy to inform you that the contract was signed on the same day. Both the shipyards signed the contract on the same day. My first ship has already undergone full power trials, and it is ready for delivery. We are confident of delivering this vessel by March 15. 15th of March this year. The second and third ships are following very closely, and we intend completing this project also on schedule. Our contracted delivery timeline is by October 2026. All the eight ships, we are on track, we will be able to deliver by October 2026. The fourth project that we are doing for the Indian Navy is a Next Generation Offshore Patrol Vessels. This is a four-ship project on track. The first two ships we are almost at 40% progress. We intend launching these ships during the calendar year. Actually, the project was signed only in 2023, March 30. The project delivery timelines stretch up to 2028, 2029, the last of the ships. On track as of now. Coming to the other projects that we are doing, the multipurpose vessels. That is the commercial platform for the German client. We intend starting the productions. Design activities are currently in progress. We intend commencing production by July this year. Project is on track. Being commercial vessels, we just cannot afford to slip on the dates. That project is on track. The oceanographic research vessel, the production has already commenced, and we intend doing the first milestone activity, that is the keeling of the vessel, by July this year. On track. The acoustic research vessel, preparatory activities are in progress. The contract has been concluded. Currently well on schedule. So is the project that we are executing for the Government of West Bengal, the 13 hybrid ferries. The last time when we met, I had mentioned four things or four or five things, if my memory is right. One is that next time, that is today, when we meet, I should be able to give the happy news that we were expecting at that point of time regarding the commercial vessels. I met my commitment. GRSE is currently in a state where multiple foreign customers are approaching us. We are taking a balanced call as to which other projects we should take on, what we should hold in our end. We are good with the commercial shipbuilding. Revenue, we had given a growth perspective. We are maintaining that, rather exceeding what I had committed last time. Third was on the ship repair, which is a very small vertical that we had started. We started in a very modest fashion. Today, I can proudly say that the ship repair vertical has gained its feet, and the facility that we have set up for the ship repair is fully loaded. We are executing orders, including export orders on ship repairs from friendly foreign nations, as well as from Navy and Coast Guard. That ship repair vertical has stabilized. Right now, again, in our overall scheme of things, the revenue generated from ship repair is very modest, but we expect substantial growth in the next 3 to 5 years. Again, happy to inform you are already aware that the company has been upgraded into a re-categorized into a Schedule A company during the last financial year on September 17. If my memory is right, we were upgraded into a Schedule A company, which is a recognition that we have been relentlessly pursuing for the last 5 to 7 years. It's your credit. Of course, the NGC tender. Last time when we discussed, it was still in liquid form. Deliberations were still in progress with the Navy. The tender is out, as I mentioned. We expect the bid to be opened in a couple of months. My conservative estimate is by April, the bid would be opened. Again, happy to inform you that we have a memorandum of understanding with the government. We are a government-owned company, mostly 74% of the shares are with the government. So we have to sign a memorandum of understanding, and based on the performance parameters, the company is assessed and on a trot for 2 years, including 2023, 2024, we have been rated excellent. That's the highest rating. Out of a score of 100, we have attained 96 points. Even you have a major contribution because the market response is another evaluation criteria. Thank you. I think I've covered most of the aspects that I got to say. I thought I'll just stick my introductory address to the minimum. I'm open for any questions as you deem fit. Please. Sir, thank you so much for the presentation. Thank you, sir. Can someone hand over a mic, please? Normally, there is a strategy. In a con call, which is one hour, I always look at the clock. Now I am seeing you. Otherwise, I will stare at the clock, 20 minutes, 25 minutes. Then the number of questions become less. You have only 35 minutes. But today, no such Yeah. Again, thank you, sir, for the stewardship and excellent set of numbers. We are very happy shareholders here. I want to ask you a couple of questions. Please. The first, in the budget, there was a lot of talk about moving around Mazagon Shipping, a INR 25,000 crore fund. Could you give us some color on how that would help us? B, you mentioned a lot of orders that possibly could be opened this year. Can you quantify the expected value? Whether we get it or not, the expected value of that order for us. Thank you, sir, so much. Sure. Thank you. I'll start with the orders which are on the anvil. The Next Generation Corvette, the AoN was taken for INR 36,000 crores, which means the L1 shipyard, purely by the calculation, should get around INR 22,000 crores. My assessment is that could be well beyond that, which means it could be between INR 25,000 to INR 30,000 crores for the L1 shipyard. L2 shipyard will get around 15, five is to three, around INR 15,000, INR 16,000 crores. This is for the Next Generation Corvette project. I'd also mentioned that the P17 Bravo AoN has been accorded. The total value for which the AoN has been taken is around INR 70,000 crores, which means each ship would be around INR 10,000 crores. The L1 shipyard would get four ships, and the L2 shipyard would get three ships. Here, I'd like to add on that I'd mentioned that three shipyards and two will get it, so the probability factor is high. Our confidence is that having built the P17, and since we do not expect any major design changes over 17 Alpha to 17 Bravo. So we will be bidding with that kind of confidence and reasonable aggression. Coming to the other projects, the 18 follow-on, or rather NG. Nowadays, every project you will see that NG, so that is a fad, Next Generation, New Generation. So it's an 18 ship project, NG FPV project. The order value, as of now, it is likely to go to a single shipyard. The conditions of the financial qualification eligibility criteria are going to be stringent. Some shipyard who has got the capability, naturally we will be there, and maybe around four more shipyards should be there. Here, the order value is likely to the tune of around INR 3,000 crores. Then there is a five ship Survey Vessel, NG SVL, Survey Vessel Large project, NG SV, Next Generation Survey Vessel project for the Indian Navy. This is a five-ship project. We expect the order value to be around INR 3,500 crores. Again, this will go to a single shipyard. A 31 Waterjet FAC project. This is a relatively low-value project. We do not expect the cost of a Waterjet FAC ships, even with that NG factor, to go beyond INR 100 to INR 120 crores. This, again, could be to the tune of around INR 3,500 crores. Then comes the 120 Fast Interceptor Craft, around INR 2,500 crores. Then two multipurpose vessels for the Navy. The project is two ships are currently being constructed by Larsen & Toubro Shipyard at Kattupalli. Navy has now come up with an RFP. It will be coming out with an RFP for two more ships. This could be to the tune of INR 1,200 to INR 1,400 crores. This in a nutshell, gives the overall projects that are on the anvil. If I missed something, maybe if a subsequent question comes, I can answer. Budget? Yep. Obviously, the first two are the most lucrative, the ones you mentioned. Between them, they're how much? INR 1 lakh crore, isn't it? Can you tell us the status of this? Do you think it would be L1, L2? What is your working hypothesis of those projects? See, in the NGC project, we are confident. Why we are confident is purely because, I had mentioned this earlier, that as far as corvettes are concerned, we have mastered the construction of corvettes. Nine corvettes, both missile surface as well as ASW, are currently running in the Navy, and all nine are built by GRSE. That's the kind of expertise. So here, I had mentioned that it's around INR 36,000 crores. L1 will get around- INR 24,000 crores 25 to 30. Yeah. Okay. This is the first project that is on the anvil. When will this open, sir? When do you expect to open? Our conservative estimate is 3 months; optimistic, 2 months. Okay. That means as early as March-end to April-end. That is very close, sir. That is something very close. Okay. The other one? The- The P17 Bravo. P17 Bravo, we expect the RFP to come out only by year-end, because the AoN was accorded, I think, just about a couple of months back. We expect the RFP to come out. Again, put a moderate timing, by end of the current calendar year. If it comes by end of the calendar year, the L1 determination, you put an efficient time of six months from bid opening to by past experience, which means by mid of calendar year 2026, the L1, L2 shipyards will be known. Here, the L1 shipyard, as per the AoN taken, will get around INR 40,000 crores, and the L2 shipyard will get INR 30,000 crores. Are you confident of that also? Yes. Definitely, we are confident. It is three shipyards only. Two will get it. Right. We should get it. Yeah. Just to follow up, sir, on the first order that you mentioned, INR 36,000 crore order, which you get INR 24,000 crore. That also you said is your strength, right? The basic corvette. I will tell you why. One, I mentioned the experience. Okay, experience, maybe somebody has undergone. Still, we will just neutralize that. Only four shipyards were eligible for this. Only four have been permitted to bid for this. Of that, two will get it. Mm. Right. It is- Also, if that happens, then your order book doubles, basically. Yes. It will double, more or less. Right now, my order book is, naturally, it is depleting. Yeah. Because we are executing. Last year, I think when we started the financial year, it was around INR 22,600 crores. Now, it has just gone to INR 23,877, despite getting multiple orders during the current year. Right. We are depleting an order book, but no fear. We will get a couple of orders in the coming year. Yeah. Great. Thank you, sir. Also, can you speak on the budget? What are your impressions, sir? Yes, sir. It's a very interesting budget with respect to shipbuilding, because the Maritime Development Fund, they have allotted INR 25,000 crores. They kept a corpus of INR 25,000 crores. What the government is planning is to provide assistance in terms of either equity or debt, with 49% investment from the government, and the industry should invest the balance of 51%. This could be for pure shipbuilding projects or creation of shipbuilding infrastructures. This is an interesting aspect that came out of the budget. Government has already, the action has commenced. Most of the coastal states have come out with RFIs for EOIs for creation of shipbuilding clusters. For example, Gujarat, Karnataka, Maharashtra. Maharashtra, I'm not so sure. Gujarat, Karnataka, Andhra, Orissa, and Tamil Nadu. So shipbuilding clusters are planned to be created in these states. The benefit for us or all of us would be the assistance from the Maritime Development Fund that the government has earmarked. Third is the Shipbuilding Financial Assistance, Version 2. The Shipbuilding Financial Assistance policy was always in existence. Of course, it is not applicable for warships, but since we have ventured into commercial shipbuilding, and in a strong way, this will definitely benefit us, because the subsidy that is being allotted by the government. Basically, their intent is very clear that they want to boost the shipbuilding industry in India. So that will definitely give a fillip to the commercial shipbuilding. These are the major aspects that I can pick from the budget. One more thing is very interesting. I think I mentioned in passing last time in our con call, was that the government has come out with something on recycling. That is ship breaking. If you break a ship in India, then you get 40% of scrap value as credit. You can avail that credit as an assistant, direct assistance from the government, if you build a ship in India. It's a very enticing offer. So I think on the whole, with respect to commercial shipbuilding, the budget has been very encouraging. More is there, but- That's fine I think that is But that helps more commercial. It doesn't really help us. No, it helps us. Why it is helping us is, see, when we met last time, I was a bit hesitant. I would not say hesitant. We were just contemplating, "Should we go in for commercial shipbuilding or not?" We have taken the risk, and we have gone ahead. Since we have gone ahead, we would like to go in a big way. So if you're going in a big way, all these initiatives will help. Sir, if I could follow up on the two new contracts that we are talking about. Are they on a cost-plus basis or are they on a competitive basis? How would that mechanic work? Which? The two new contracts that you're talking about. Okay. Yeah. The NGC and the It's a hybrid. There's a fixed element for the effort. There's a valuation by the shipyard, and certain equipment, it is on cost-plus basis. We term it as fixed cost and variable cost. So it is going to be a healthy mix of both. Margins will be what? 7%, 8%? The margins for that would be? Margins would be +8%. +8%, great. Thank you, sir, so much. Thank you. Pleasure. Please. Sir, can you speak more about the export potential? I think the next five years or next 10 years will be for exports. How we are prepared for the export potential? Thank you, sir. What can be our, for shipbuilding, as you just now told, what can be our share, roughly where we can stand in next five years? Thank you, sir. Right now, as on date, just about 4% of GRSE's order book is coming from exports. Our total order book is INR 23,877, and just about INR 970 odd crores is coming from exports. As I mentioned, we are pulsing the system, but with the kind of offers that are coming, the queries that are coming, we are taking a calibrated approach. We have gone ahead and invested in revitalizing one of our facilities. I know that you're looking for figures, so I will give you always. No. I'll say on a conservative basis, we'll be looking at a twofold increase within one year and at least a fourfold increase from the current value in the next four years. I'm just giving a band. You mean fourfold on the amount of exports that was done currently? Absolutely. That should increase fourfold. Yes. And sir, regarding these budget proposals, how does exactly it work? Let's say the government has proposed shipbuilding clusters in some of the states. How exactly would it work for a company like GRSE? What can you do exactly? Would you be owning the cluster or having one of the facilities and somebody else also will be having facilities? I'll try and answer in this fashion, sir. Right now, I'm speaking from GRSE's perspective. I'll build a background and then answer your specific question. Right now, we have got three fully usable shipyards in Kolkata, GRSE. Plus we have hired some facility. All put together, our shipbuilding capacity, last year when we met last year, it was 20 ships. We have increased to 24 ships already. With what we have, by end of this year, that means end of calendar year 2025, we'll be increasing to 28 ships. But that 28 is also grossly inadequate to meet the requirements, and that's why I said, some of the offers we are not able to take on. So there is the need to expand beyond Kolkata. Naturally, Kolkata has got an inherent limitation of draft. So whenever we do construction, we match the tide and do the construction photos. So we want to come out of that once and for all. It is with that intent that we will be looking at facility outside Kolkata. I am not in a position at this moment to say when, but that the ball has already been set rolling. Now, the states which have shown interest in creation of shipbuilding clusters are what I mentioned, Gujarat, Maharashtra, Karnataka, Tamil Nadu, Andhra, and Orissa, because all of them have got adequate depth and the draft, adequate depth is available. Now, when you say a shipbuilding cluster, it will definitely have the shipyard at the core of the cluster with the ancillary industry. Ancillary industry could be a manufacturing industry which supplies items. Then the logistics arrangement, there has to be a transportation. So the cluster contains multiple facilities with the shipyard as a core of it. There could always be a port also co-located. This would, in a nutshell, mean what are clusters. Now, within the cluster, what is it that the government is going to offer and what is going to come from the shipbuilding, what is it, Maritime Development Fund? For example, one of the RFIs, EOIs, which one of the states had come out, they are ready to invest and provide a breakwater. Breakwater means it's a structure, maybe a kilometer long, which will protect the sea from coming inside, which means what is within that breakwater is usable for ship construction. They are ready to create jetties, building berths where the ships can be located. The shipyards would then need to invest in creation of dry docks and building berths. That will be the investment from our side. Some of them have already offered a 10-year rent-free period or rent at very nominal rate. This coupled with debt that the government may give, it's a win-win for everybody. That is what we are looking for. So I think hopefully I've answered your question to some extent. Yes, of course. Sir, I want to ask you about the ship repairs. You have been speaking in your conference calls. So- How exactly do you plan to grow that part of the business? Especially now with this closing better relationship with America and other countries, probably that might open up a very big revenue stream for the Indian ship repairs companies. How exactly would GRSE plan to position itself on that? Do you see something in the near term happening, or maybe it will take a very long time? Okay. I will put it this way. We were not into ship repairs. This is 2025. Just about 4 years back, we started the process. We took 3 dry docks on a long-term lease basis from our friends in Kolkata Port Trust, SMPK. We have taken over that. That is the facility which we have created dedicatedly for ship repairs. When we started getting orders, we found that itself is not adequate for us. Both the Navy, see, Navy has got the dedicated ship repair units across the coast, naval dockyard cells. Still, with the kind of ships that are coming up for refit and repair, they are not able to handle the load. So few orders have come from Navy. Coast Guard do not have any dedicated repair organization, so 100% of the Coast Guard orders will go to one of us Cochin Shipyard, L&T, and some other private players. The demand is very high, but the capacity is limited. We have now taken over, the contract is not, agreement is not yet signed. 1 more dry dock, which is unused with Kolkata Port Trust, we have taken over from them. This will augment our capacity. The revenue, what we are generating from ship repair, we are actually hesitant to take more orders at this juncture because of the capacity constraints. In a year or so, we will be able to double the revenue that we are getting from ship repairs. This is one. That also will not address the issue, because if we are limiting our ship repair to Kolkata, it just will not meet our requirement. What we have done is we have formed partnership with very, very small shipyards whom we use as our subcontractors. Take the order at a reasonable, ship repairs is a high margin. We intend doing this refit that we already executed one somewhere near Jamnagar. We had a collaboration with one of the private shipyards. He got this job done. We did the project management. We got a good margin out of that. In addition to creating our own facility within Kolkata, we will be having a structure where when we partner capable small shipyards, do the project management, ensure quality, and get good margins. Bottom line, the crux of it is that we intend almost doubling our ship repair revenue in one year. Yes. Sir, the U.S. naval, their fleet of 100 ships and all, they wanted to empanel a number of Indian companies to do their repairs. Have they visited GRSE? If not, why not? I will answer this question, because be it MDL is at the sea is next to them. Be it Goa, sea is next to them. L&T, sea is next to them. HSL, sea is next to them. We are a riverine shipyard, and that is one part. We are not comfortable to go in for an I am not getting the MLRA or MSRA or something with the U.S. as of now. At this juncture, we are not in a position to go for that. Second is, let us say we hire a facility, we collaborate with one of these counterparts there. So far, this agreement has been signed nearly three or four years back. How many ships have come? Hardly anything. We can count one, two, three in the last four years. At this moment, we are having a wait-and-watch policy for the U.S. or any other fleet. Last questions from my side. Okay. We have been announcing from time to time some alliances for, say, some global company, for instance, the marine engine production and all that. Is there any potential in terms of actual revenue terms and how it will unfold going forward? Which of these alliances you see likely to materialize now? Okay. I'll give a perspective that when we sign MOUs is like sowing wild oats. It's like we do business development. We attack 100 leads. If even two leads fructify, it is success. Similarly, in case of MOUs, we have live MOUs with Rolls-Royce for MTU, Rolls-Royce for marine diesel engines. We had one with Caterpillar, and we had one with Kongsberg. I'm only speaking about engine and water jets. Of these three, one has matured. It is the Rolls-Royce MTU MOU. When I mentioned earlier about the 31 water jet FAC or the 18 fast patrol vessels, it is those type of engines that are going to get into these ships. Which means, let's hypothetically say this collaboration succeeds, and it is 31 into three, 63 engines in these ships, and 18 into two, 36 engines in the Coast Guard project. So opportunities are there. We were earlier having an MOU. MOU was initially for assembly, testing, and so on. We get knockdown kits from there. We have a diesel engine plant in Ranchi. We used to button up the engine, we have a test bed there, and then deliver. We have just transformed that into co-production because we found that is not attractive. It's like value addition. There's nothing. But now we have gone for an agreement. It's called a license agreement for co-production, where, as per the government policy, at least 50% indigenous content should be there for every project. So many of these foreign OEMs who are supplying 100% automatically get knocked out. We are leveraging that government policy to get into this 31 water jet FAC, as and when it comes. As a matter of fact, I've just come back from Bangalore. I was in Bangalore for the Aero India. We had a closed-door meeting with Rolls-Royce to further this Project. You may also have noticed that GRSE has signed, since you asked about MOUs, with several partners. I'll give you one example. We have a collaboration with Elbit, Israel, and their joint venture partner in India for manufacture of naval surface guns. Very attractive project. Our role in that is certain components manufacturing, project management, installation, but the margins are good. So we decided to go in for that. So that was an MOU which started off as an MOU, which translated into an order. We recently signed an MOU with a firm called Apollo Micro Systems. It's a listed company, very good company. We had an interaction with them. We understood their business. We got into an MOU with them for moored mines, which may be required in large numbers. It has not been translated into an order at this juncture, but opportunities exist. Like I said, MOUs out of 10, if two fructify, it is success. Sir, we have three companies. One is Cochin, and one is Mazagon, and one is Garden. How is cost to get an employee and workers compared to Kolkata, is it cheaper compared to Goa or Mumbai or Cochin Shipyard? Okay. Very tricky question. See, I have been in Kolkata for the last, my ninth year running in Kolkata. I quit from a naval unit in Cochin Shipyard, the IAC project. I was heading the aircraft carrier project in Cochin Shipyard, so I know the work culture and the employees there. In Mazagon Dock, I was part from the Navy side for commissioning P17, Shivalik-class ships. So I know all the three shipyards well, with GRSE naturally being my home. If you look to answer your question about cost of labor, it is almost same at all the three places. It is almost same at all. Because, see, as a policy, none of the three shipyards, none of the five or six big shipyards, we are not taking too many permanent employees. The strategy by all of us is outsourced work, and we do project management. Core expertise in design, we retain. Some of the block fabrication or specialist jobs we retain. But most of the labor is through contracted workforce. The contracted workforce rates are same because we all pay central wages, central government wages, minimum wages for central government. So I feel it is at par. Each shipyard has got its own environmental issues that you discount that, but otherwise, the cost of labor is more or less same. Are we looking at that since we are expanding at Vizag shipyard for some shipyard or something like that to acquire and expand? The expansion is not because of the cost of labor. Expansion is purely because, one, we are stretched to our seams in Kolkata. Because we have got limited land. That we have done to our best capability, expanded it, revitalized it. Now, if we take more facility in Kolkata, the disadvantage is that it's a riverine shipyard. The limitations with respect to depth will still remain, heavy limitations. So we are good with what we have in Kolkata. But if you really want to expand to a global shipyard where we can construct vessels of, let us say, 300 meters length, commercial vessels, then you need areas with flat. It is with that intent we are likely to go out. But it is still in liquid form. Discussions only are at this stage. Maybe next year when we meet, maybe I'll be able to give you some good news on that. Last question from my side. Sir, you just told about the export market. Could we expect by end of next year, around 15% order book to be from export market? No. I'll answer in this question. I'll try and answer in this fashion. See, you take a 10,000-tonne commercial ship, and you take a 300-tonne warship. The cost of the warship is more than the commercial ship because in every ship, it is the equipment and weapon and sensors that carry the order value. 50% we're not even looking at it. Because, see, you must also appreciate that we have been set up. We are a company that has been set up with an intent for the maritime requirements of the nation. There is enough, what I just mentioned. I just mentioned four or five or six projects of Navy and Coast Guard that are going to come. There is enough number of orders going to come in the near future for all. But we are not happy only with that. That is the reason why we are going for export. One, for global recognition. Second, after we put our feet firmly on ground, the margins are going to be good. So I expect. Right now, I just mentioned that the order book position, the contribution of commercial export orders, just about 4%. Maybe it could go to 10%, but not the level what you're looking for. We're not looking at that because of the reason I mentioned. Sir? Yeah, please. Okay, sir. Ramesh Bhojwani from Meta Investor. Sir, before you came, there was an audio-video presentation. That film was excellent. It took us back to 1884 to today. The progress of your company and the progress of maritime and shipbuilding, in particular Navy and the Coast Guard. That was wonderful. He came a little early, so I had a chance of seeing it two, three times. Now, the thought which came to me, I was in another conference where there was, I think, the commissioner from the Government of Nepal or the High Commissioner Head of Nepal. Sorry, Vietnam. He mentioned Vietnam has a coastline of 3,000 kilometers. India has a coastline of 7,500 kilometers. And we need to have extremely accurate Coast Guards as well as naval ships, which are monitoring and which are seeing that there is no room or no leak or a weak portion, foreign access to anybody. Absolutely. The thought which was coming to my mind was, sir, have we developed adequately strong stealth facilities for our ships above the sea and in the submarine? Okay. You have the liberty of not answering it to full, but just the idea. I will try and answer in this fashion. The role of coast protection is that of the Coast Guard. That is why they are called the Coast Guard. Yeah. The role of Navy is beyond a certain, it is outwards. Yes. With that background, Coast Guard, the government has really realized the need for augmenting the capacity and capability of Coast Guard. Just to put things in the perspective, I was making notes, somewhere I have written down that Coast Guard budget for capital acquisition, they have increased, I think by 26% or something in this year. That's why they're coming up with several RFPs. As far as technology is concerned, there are multiple agencies handling the security of the coast. One is, of course, Indian Coast Guard, then there is something called MARIT. Each state is also involved. Yeah. To answer your question, yes, there is room for improvement, but I think Indian coastland is adequately protected. Just to also to put facts on the right perspective, it was 7,516 kilometers, but after recent survey, you can check it up, you can Google it. It is around 11,000 kilometers. Oh. That is the kind of coastland with all our, that we have. Our job has virtually doubled. Sir, that was the one thought which I thought I will share with you. The second thought was your opening expression of the performance of Q3 and 9 months. What I heard correctly is the top line, I believe it is third quarter was INR 1,271 crore. Yes. The PAT was INR 98 crore, which was 4%. Yes. But I didn't get the EBITDA figure because you rattled it very fast. I deliberately rattled that very fast. Sir, I just skip over that and go now. Okay. See, our revenue from operations was INR 1,271 crores as- Third quarter. Third quarter. Yeah. The PAT was INR 98 crores, and the EBITDA was INR 147 crores. INR 147 crore. For the nine months, if we can multiply this with three? No. I'll give the figures of 9 months. In 9 months, the revenue from operations was INR 3,434 crores, and the EBITDA was INR 421 crores, and the PAT was INR 283 crores. Yeah. So virtually it comes into 3. Yes. Going by this, we will end this year almost close to INR 5,000 crore, little less. You have- Please don't comment. Sure. The one point which you mentioned further was, that we are registering a 38% CAGR. Will this 38% CAGR be maintained going forward, not only in the next year, as I see it, the next five years? Okay. I think I'll answer this question clearly. See, our current order book, of course, is INR 23,000 crores, which hopefully will come down to around INR 22,000 something by end of this financial, unless we get some fresh orders. This is going to last, including the new projects that we have signed up to 2029. The big projects, that is P17 Alpha, touch wood, we should be able to finish by mid of next year. So the maximum revenue accrual will happen from this project. I had mentioned, see, this 38% CAGR, 38% perhaps is not there. But we'll be able to maintain our CAGR between 20%-25% over a five-year period. I think that gives you a clear answer. Perfect. This is absolutely accurate. The one last point is, sir, where you see a possibility, definite possibility of ramping up the EBITDA and the PAT margin? See, it depends upon the projects that we are getting. Project execution cycle. If the P17 Alpha project, our margins are good. Suppose some of the projects which we have taken at very low margins, because we need to get orders. Unless we have orders, we will not be able to perform. So it is a mix. Okay. It is a mix. In this, I think I will preempt the question and answer. Our operating profit has really gone up, but our PAT margin, EBITDA margin has come down when you compare to the last. There is a drop in there. But it is like a sine wave. I have been consistent in my views on this that we will be able to maintain PAT margin above 8%. This time we have dropped in this particular quarter, it was 7 point something. But on the whole, by the end of the financial year, we will be able to correct that. Wonderful. But again, I will clarify because I know otherwise I can address more questions in one shot instead of piecemeal questions coming. If we get the Corvette project, if we get the P17 Bravo project, naturally the margins are going to be higher than that. Sir, what I see from your body language, of course, till you get the order, you cannot say it is in hand, but I am very sure that these orders are with you. No, I can't say. How can I say? Going forward, because the priorities of- I just stated the probability factor, simple mathematics. Yes. 4, 2. Yes. Three, two. Yes. So plus confidence. So it is all put together, we can expect. Thank you and all the best. Thank you. Yeah. Good evening, sir. Sagar here from Printread Investments. Just one thing. Let us say we have three major shipbuilding companies. The promoter is the same. Now are we getting or taking market share from them? Is there any competition among us, or it is like sister companies, like, we are just working in parallel with each other, and there is no pip in market share for any of the players? That is one. How are we differentiating ourselves from the rest, and what better things can we do going forward? What are the challenges that would come, let us say, 22%-25% CAGR, what you have guided. Are there any challenges, or we are quite comfortable that could be maintained? Very interesting question. There was a time when the market share was allotted. That is the era of nominations. There was a time much before we got listed, when we were all in a comfort zone, which means the orders were assured, cost-plus orders. The situation has completely changed. Luckily, it changed before we came to the market. By that time, the orders became either hybrid, that is what I mentioned about fixed cost or variable, or pure fixed cost contracts. Second thing is the government, except for very specialized projects like the submarine order, which has gone to Mazagon Dock recently, very specialized projects. Or the IAC, which went to Cochin Shipyard about 14 years back. All other orders are coming through competition. The market share depends upon the efficiency of the organization and the build strategy and the bid strategy that they adopt. Now, in any shipbuilding industry, you need one is you should have the dock and berth infrastructure. That is the primary requirement for shipbuilding. The dock, that is the dry dock where you construct the ship, and the building berth, and the jetties where we park the ships for outfitting. Second is the infrastructure, the crane age and the associated with. That in today's environment, all the shipyards, major shipyards of the country, they have reasonably adequate. Of course, the demand is currently more than the capacity, but that will even out. The third is the resources, the skilled manpower. As a strategy, all the shipyards are adopting to outsourcing for non-core jobs. But the skilled manpower available in the country, the whole of specialist shipbuilder is limited. Whoever offers the highest pay will come and work there. There is, since you asked what are the challenges, one is availability of skilled resources. We are putting in measures to correct that also. We will be training through our own fund, picking up from some particular area which is known for a particular skill. The last point is there is a huge reliance on the supply chain system, because ours is an industry where shipyards are primary platform integrators. We build a hull form, then we put this, that, the equipment systems, button up, and get a platform ready for us. So we have a huge reliance on the supply chain system, and this supply chain system comprise of major players like Bharat Electronics, Hindustan Aeronautics Limited, or global players, to very small MSMEs. So there are situations. We say COVID is over. COVID is not over. There are still firms who are reeling from the cascading effect. So there are challenges, but I think we are more or less tided over or tiding over these issues. Challenge very much exists. Got it. Just to add on that. So let's say you said that equipment and all those things, all the three shipbuilders have. So let's say in the top three, our capacity today is 24 ships. Let me know what is the capacity of the rest of the two? And the second one would be, you said we might look at an acquisition going ahead, okay, in the next one year acquisition mode or something. So any probable ticket size that you would look for it? Sorry, can you just repeat, split the questions and ask them again? The first one was, let's say all our top three shipbuilders, we have a capacity of 24 ships a year. What would it be for the other two? Just to place on record, 24 was enhanced from 20 till 2000. If you are looking at the other two shipyards, in case of Mazagon Dock, they have capacity to build large ships. Their dry docks and building infrastructure is larger than ours. The numbers may be less. Numbers are less, but the bandwidth for larger platforms is more. Same goes for Cochin Shipyard also. Actually, Kochi has got the biggest dry dock other than Pipavav, the biggest operational dry dock in India. That will give them the flexibility of building large ships like the aircraft carrier. We don't have that capacity, but what we have, our biggest strength is multiple dry docks of various sizes, which can cater today up to destroyers. Destroyers means the ships above frigates and corvettes. This in a number exactly, I will not be able to tell. That will give a It's not an apple-to-apple comparison, but different types. Capacity in terms of numbers, we definitely have the largest, but in terms of size, we don't. Got it. The last one, the acquisition that we will be looking for going live, which may or may not happen, but any particular ticket size in your mind, like this much is something that we can go for? Sorry. The acquisition, the tech acquisition or some merger, et cetera, that you said we may go for. Any particular ticket size or quantum? See, at this moment, if at all we go, we will be going for a greenfield facility, which will be developed maybe in a span of 3 to 5 years. We are not looking for. What we have done, we have actually offset this problem by. I will give you an example. When we took on this anti-submarine shallow water craft project, it was an 8-ship project. We were full with respect to our dock and berthing processes. At that point of time, L&T Shipyard, Kattupalli did not have any order. They had huge spare capacity. We collaborated with them. We did part construction of these ships. They are leveraging our core expertise of design, project management, and procurement, and their facilities. That is the model which we have adopted, not only with the L&T Shipyard, one of the small shipyards in Kolkata, we have one export platform, we did part construction there. That is the methodology which we are currently adopting till the time we develop a facility, a greenfield facility outside Kolkata, which will take time, because a greenfield shipbuilding facility just does not come by switching on a. It will take a bit of time. Thank you. Thank you. Yeah. Thanks, sir. Sir, when we talk about the next generation corvettes, the 8 in number project, you stated there are 4 bidders for the same. Can you give the names of those bidders? It is open. Is it open information? It's open information. It is Goa Shipyard, Larsen & Toubro Shipyard, Mazagon Dock, and GRSE. Okay, these are the four shipyards, right? Sir, another question, and this is more to understand the shipbuilding capacity. What I want to know is that, essentially, if there is a shipyard, we are making the hull of the ship. Once the hull is made, can we launch the ship in the sea, and then those gadgets can be uploaded there, and the shipyard is again available to make another hull of another ship, so that when we say we are increasing the capacity, it means that you make the hull, roll it over on the sea. The work is happening on that ship as well simultaneously. Is that the right way to understand this? Could you make me understand? Okay. I'll try and give the background. See, in today's shipbuilding methodology, we do not just make hulls. As the hull is being built, the shipbuilding starts with cutting of a plate. Then we assemble the plates in some shore location. This means on the dock. Then these are lifted by cranes, put into the dry dock, which means suppose if a ship has got 20 blocks, 20 blocks are constructed at multiple locations. Then they are jumboized within the dry dock. As we do it, we do pre-outfitting, which means there are certain mandatory equipment like the main propulsion engines or the power generation equipment or the AC plant have to go in at the time of launching. Because there are various technical requirements to be met when the ship is in dry dock, and after the ship is moored. Then we, of course, moor. We moor the ships, do the balance buttoning up, the system integration when the ship is afloat at the jetty. While the next ship comes in, you're right. Exactly. That is so when I'm telling we are currently constructing 40 platforms. Naturally, on the same berth, thus I have stated that our shipbuilding capacity is 24, is purely by this method. While 24 ships are at various stages of construction, building berths or dry dock. Few of them are at the jetties doing outfitting, being readied for trials and delivery. So you are right. That's the methodology. Sir, one clarification regarding this NG corvette INR 36,000 crore order. You said L1, instead of INR 22,000 or INR 24,000, it can end up becoming INR 25,000 or INR 30,000 crore. How is that actually? I think the whole INR 36,000 will end up becoming INR 45,000 crore. I will tell you. See, when any AoN is taken, you have seen examples before also. Any AoN is taken, AoN is based on an assessment of the customer at that point of time. But in reality, because the AoN would have been taken, in this case, it was taken almost 2 and a half years back. AoN was 30 months. Now, I think 33, 34 months have passed. The times have changed. The equipment costs have gone up. It is our assessment. It is purely an assessment that the INR 36,000 could go up to INR 42,000, INR 45,000. A conservative estimate is that the L&T Shipyard could get in the range of INR 25,000-INR 28,000, let us say. It is mostly inflation, not that some specifications have been added to the project and all that. No. Specifications and all. It is mostly inflation, which is the reality. Right. Which is the reality. Right. Thank you. Which means justifiable inflation. Sir, if I can ask one question. Sir, going forward, there are those clusters which are getting developed, right? So we are at maybe reasonably very good utilization of our possible capacity at Kolkata. The clusters which perhaps, so what are the thoughts over there? What is it that you would like to have as a company for Garden Reach? Because you have been there with Cochin, you have been there with Mazagon, and you stated those large ships can be made at Mazagon, but we don't have the capacity. So what would be that key thing in those clusters that you'll be looking at going forward? One is the cluster would be in a place where adequate depth is there so that all our constraints or whatever juggling what we do, we manage. But then it's after a lot of technical juggling that we do. So that problem would be addressed once and for all. Second is the capacity to build huge commercial ships. The warships, we are not much worried because we intend limiting our. Because I think this question was asked some time before, whether we would like to go for submarines or. No, we are not planning to, because that requires around 20 years of expertise to build up. So our vision with respect to warship building would be to destroyer level and with commercial ship build, commercial ships to super carriers or Panamax vessels. So for that, two requirements. One, the dry dock has to be adequately big, and second, the depth should be adequate, at least 16 to 20 meters of depth. Thank you, sir. Sir, I have two questions. Yeah, please. I have two questions. First, can you talk more about the probable timeline of the three projects, corvettes, frigates, and destroyers on the basis of RFP, the actual order, the signing of the contract and order booking. The second one is, without considering the new projects, when will the current order book exhausted by? Okay, I will answer the first question. Without considering these three projects or the export platforms that we are very confident of getting, keeping that aside, the current order book will expire by 2029. Coming to the first question, I will take it in three parts. The Next Generation Corvette, the bid likely to be opened conservative within 3 months, that is April, I think. From the time the price bid is opened, technical bid is already opened, and all four of us are cleared. It will take, knowing the systemic efficiency or inefficiency, it will take around 6 months for the contract to be signed. The revenue recognition from that will commence from 2027. That is ideal for us because that is when our dip will start. That is when the corvette should paddle. P17 Bravo, by end of the calendar year, that means 2025 end, the RFP could come out. From RFP to L1 determination, it could take, having seen the experience of NGC, it could take around 7 months from the RFP to price bid opening, and from there, 6 months for contract signing, and 2 years for revenue recognition, which means if P17 Bravo comes through, the revenue recognition will start from 2029. NGD, the Next Generation Destroyer, is still in liquid form. We do not like to comment on that because it is still under discussion. They have not even taken an AoN for that. Thanks. Sir, thank you for very detailed and candid answers to all the questions. I had a question around your investments in technology, automation, and people. If you could give us some thought process on the efforts you are making in terms of benchmarking GRSE with not just the other options in India, but even with some international peers, et cetera, and some investments that you may be considering in either technology, automation, people, et cetera, to build capabilities of the organization. Thank you. Technology augmentation or upgradation is a focus area for us on two counts. One is for creation of new products. I will come to that. Second aspect is for improving our own efficiency. Just to give an example, when we got this multipurpose vessel contract from the German client, we had been put through a wringer. Two classification societies came, assessed our capacity, capability, our processes, and then only cleared. They gave suggestions, something which we did not have, a certain painting process, which is normally used in commercial shipbuilding. We did not have that facility. They said this has to be created, and we have done that. So technology adaptation towards process improvement is a focus area for us. We already have a robotic welding machine doing work for us, and so on. This is one part. Second is for new product. Many of you may not know, our product range have also got autonomous vessels, fully green vessels. See, initially, we did a project for it is actually the country's largest ferry, a fully electric ferry, fastest ferry. But revenue-wise, it is peanuts. But we still went in for that. Why? Because we wanted to first establish our capability and then make an inroad. Because we took that, we subsidized it under the R&D fund. Because we did that, we got qualified for the next World Bank-funded project. So we are fully focused on these two aspects. That is technology for one, new product creation, technology for process improvement. I feel we are on the right path. A lot of room for improvement, but we are on the right path. Correct. On the people side, have you also been making efforts in terms of training, et cetera, just to improve efficiencies there also? Pardon? On the people side. Yeah. Training of manpower, et cetera. I know you mentioned contract and labor, et cetera, but just some Okay. Thank you. See, people, I will just split it into three parts. People, as in my core, I would not say core. My permanent manpower is very limited, just about 2,000 people. And of these 2,000 personnel, around 520 are officers, which means we are a very top-heavy organization, deliberately so. These officers, most of them are from the top education institutions of the country, many of them from the IITs and NITs. So the technological knowledge-wise, we are good. We have some of the best facilities in India with us. We have a virtual reality lab, a top-end virtual reality lab, which we just took six years before. But we realized that that six years before is now obsolete, so we are upgrading that. That is the kind of focus we have on people and technology. Coming to what I mentioned was, since we have taken our strategy, we adopted a strategy of outsourcing on non-core jobs like simple welding, plumbing, cabling. That pool of manpower is inadequate for a nation. Right now, we are good to go. We have around 6,000 people working in our premises on an average per day. But maybe in a year or so, a year or two, when the bigger projects come, we will find it difficult, and we are prepared for that. We have found out methods, we have worked out strategies to improve the numbers of qualified people in our premises. Got it. Sir, my final question was on risk management, in terms of when you bid for projects or estimation, because these are very large value projects, and you obviously need to make a lot of assumptions on raw materials, et cetera. Just some thoughts on how strong is the organization on whether it is bid evaluation, bidding, price quotations, and risk management, because that also means supply chain and procurement. Thank you. Absolutely right. Actually, we have learned the hard way. Luckily, the impact was on minor projects. We have a robust risk management system, a board-level risk management committee, which addresses the various risks, starting from environmental to financial risks. Every bid that is submitted is with my CFO's concurrence and cleared by me. Every bid, be it small or big. It is that kind of prudence that we do. Any decision, sometimes we take a project deliberately at a marginal cost that is for our existence or for getting an entry. That is a decision, not an error. That is what I have. Thank you very much, and all the best to the interaction. Pleasure. Thank you. Excuse me, sir. I had a question. I just wanted a percentage number, like on an average, if we are building a ship, then how much percentage of that ship is being imported? Okay. Thank you, ma'am. Indigenization has been a focus area of the Government, whatever terminology, Atmanirbhar. There are so many initiatives taken by the Government to improve or increase the indigenous content. The last three projects that we have completed, that is including the Survey Vessel (Large). I consider it completed because the equipment ordering everything is over. Survey Vessel (Large) project, the Landing Craft Utility, and the anti-submarine corvette. All three projects we have 85% plus indigenization. Coming to weapon-intensive platforms. Indigenization as a service, if you are talking of warship building, 100% of the hull is indigenous. Around 70% of the auxiliary machinery is indigenous. Around 50% of the weapons are indigenous. All put together, the figure I mentioned, around 85% plus is indigenous content. Okay. Thank you, sir. My second question was with regards to the budget. We did see that this time, the Ministry of Defence had to give back somewhere around INR 13,000 crore back to the Ministry of Finance. I just wanted to know why is there so much delay in the process? Why are we not being able to spend? We also know that we somewhere need to expedite the process now because there is also a dire need for a lot of replacements and for a lot of new things to be bought. So what is causing all this delay? Why are we not being able to spend? My appreciation. It is my appreciation because it is actually for the Ministry to answer, but since you asked the question, I'll give an appreciation. Suppose if the NGC contract had been signed during the last financial year. A certain amount of payment goes as the first stage payment. They would have perhaps, in fact, I'm just giving an example. So the fund expenditure is not because of the delays in execution of the project. It is perhaps in the delays in the process itself. That is the point I would like to convey. Again, it is a sinusoidal pattern. It is not that every time the funds are surrendered. There will be occasions. In the last financial year, I understand around INR 13,000 crore was surrendered by the Ministry of Defence. Maybe in the next year, they'll make up for it. That is all I can say at this moment to answer your question. Okay. Thank you. I had a question. You mentioned about subcontracting. What part of our revenue as, let us say, percentage of revenue in value terms and in volume terms will be subcontracted outside the entity? Sorry. What percentage of the revenue? will be subcontracting. That will be made outside the entity, outside our shipyard. Okay, I will put it this way. If you take a project cost, in the project cost, around 65% comes from the equipment and sensors that we procure, and around 20% comes from the labor. That is the human resources that go into. Of that 20%, around 70%-75% is outsourced. We retain the core strength. Core strength means, let us say, the shafting work which drives the ships, we retain the competency. The complex block fabrication, we retain the competency. The design, 100% design is done in-house, because that is the most important factor. We retain that. If you put it in percentage, if you are purely looking at percentage, it may not give you a correct picture, because the design, you have to give value also to that. If you look at value cum cost, in that case, around 40%-50% would be outsourced of the labor part, and the balance is done in-house. Sir, I have a question here. Yeah. Yes, please. Please, ma'am. Yeah. So as per the budget, there is a lot of advantage for ship breaking. You did mention a little bit about it, but can you give us more clarity as to how do we plan to take it forward and use the benefits of it? Do we plan to have a separate section, or how are we planning to utilize that? Okay, ma'am. The intent of the government is actually to lure, coax the shipbuilders to build ships in India. The target, globally, I think our share of single-digit figures, low single-digit figures of the global commercial fleet. The stated target of the government is to increase this to 20% by 2047. It's a long-run process. For that, you need the ship owners. You can't impose something on the ship owners without giving them a carrot. The carrot that has been given is that if you break a ship within India, like if I am a ship owner, and next time when I construct a ship within India, I can use that credit. 40% of the scrap value of the ships broken would be credited into my shipbuilding. I'll get that kind of financial assistance. It's a very smart way to get the ship owners to build ships in India. As far as GRSE is concerned, see, the fact is, we are shipbuilders. We are core shipbuilders. We are not looking at this moment for marrying shipbuilding with ship breaking. But then, as a really ambitious shipyard, we are open to such options in the future. But at this moment, see, all these things are budget promulgated. They are not being translated into policies yet. It might take a couple of months. We'll see. If anything attractive comes out of that, we're open for that. But at this moment, it is still a statement in the budget. Thank you so much. Pleasure. Sir, my question is, since we are a government PSU, and last from one year, we as a common layman get to feeling that government is something slow in decision-making in every aspect as far as defense is concerned, which was there in last three, four, five years back. Since you are close to the government, what is your personal honest opinion whether slowdown has happened at government level because they are concentrating more on a social part of it rather than I think defense says, we feel like it has taken a back seat. So what is your personal opinion? Sir, we are not totally owned by government. We are owned by you also. Anyway. Majority is government. I would not like to consider that any decision is slow, because if you see, you watch 2025, the calendar year onwards, multiple projects RFPs are going to come out. Only when you see the RFPs coming in, you will see some momentum. Indian Coast Guard, at least three RFPs have been converted to orders in the last financial year. Three RFPs they have converted into orders. Indian Navy, NGC, whatever I mentioned, they are all at least six, seven of them RFPs are going to come out in the next one year. I do not think any decision-making delays are there. Second is all these schemes which they are coming up, be it from the Ministry of Shipping or be it from the Ministry of Defence, both are coming from the same Government of India. So initiatives-wise and decision-wise, in my appreciation as a PSU or Cmde, I do not think there is any delay. Sir, vision is too weak as far as vision is concerned, but ground-level reality, I think looks like there is some slowdown. Sir, I would like to put it this way. Vision, it is like very interesting talks have gone about quantity of work, 90 hours per week, 75 hours per week. I will come back to your point. I just want to lay the foundation for that. Subsequent to that, another business head said that it is the quality that matters, it is not quantity. So there I have a point. Quality comes only with tons and tons of quantity, and that quantity comes from time. Otherwise, quantity cannot come, and if quantity is not there, quality cannot come. Similarly, vision, yes. To get the vision, like I was just addressing one of the queries. The vision is to obtain 20% share in the global commercial shipbuilding fleet by 2047. How come from 2 to 20? That itself is a very ambitious vision, from 2% or 3% to get to 20%. But for that 20%, the initiatives, what they have listed out, Shipbuilding Corp, Maritime Corpus, Maritime Development Fund, they are all actual initiatives that are being taken. Similarly, in warship building, both the Indian Navy and the Indian Coast Guard have stated, and they are not excited. Their prospective plans indicate ships. Indian Navy wants to go threefold in the next 7 to 10 years, maybe too ambitious. Indian Coast Guard wants to double their fleet by 2030. But for that to happen, the RFPs have to come out, the ships have to be built. The process started, in my appreciation, as a CPSE head, is that the process started, the foundation laying, the concrete laying, will take a finite amount of time. But once it is laid, it will move fast. This is my appreciation. Thank you. Yes. Sir, just on similar lines, and just to add to the question you just said. Sir, historically, have we seen any point of time that once. As investors, we just want to make sure. I'll tell you, sir. The bids were opened in August 2024. The techno-commercial bids were opened in August 2024. The technical clearance they've been according to all the four. Naturally, because if they are shortlisted, we qualify for that. By November or December, I don't remember. Yes, there is a marginal delay. I am giving a conservative timeline of it slipping over to next year. But you see, sir, because these are high-value orders. When a high-value order is there, naturally, the government would not like to short-circuit a process. It takes time. From our perspective, I want the order yesterday. I want the price to be opened yesterday. But having been on the other side, I also understand their compulsion. Yes, there are delays, but the delays are not unseemingly. Parked on a shelf, not those types. So history has also never, we have never seen such a case happen. Historically, for any of the defense orders where RFQs were there, tenders were invited from participants and. I'm not able to recollect. I think maybe, yes, sir, but I'm not able to recollect any of the RFQs getting canceled. Not getting converted into an order. No, not getting converted into an order. There could be a delay. Sure. Not canceled. Perfect, sir. That's our- It always happens. It always happens. Yeah. Patience is the name of the game. We are there, but just to make sure. Absolutely. Yes. Thank you, sir. With this, we conclude the Q&A session. I think somebody has already raised hand. I think we should give her a fair chance. Okay. Thank you. What is your cash and bank balance? I hope your question is not tricky question. It is like I just want to put my foot in my own mouth. Ask a general question, how are you doing and all this. I am not- We have two questions. What is your cash and bank balance as on December? Cash and a simple question. This is a straightforward question. Where is it? Can you? I will let DF answer this question. Yeah. I am true. Cash and bank balance. This is as on December 31, 2024, INR 3,214 crores. Out of that, our own fund is INR 577 crores. Second question is on your provision. Next year, as you will be completing P17 Alpha for next two years, you will be taking a provision for that, mainly for liquidated damages and for other owner's contract, which is a general norm. How much is the percentage of your sales would that be? Because that will impact specifically on your margin. These are your high-value contracts. If you can share some numbers. Yeah. Provision, liquidated damages, we are making provision as per Ind AS 115, and the provision is made only when we will exceed the delivery schedule. As on date, whatever already Sandhya has told that the project what we are executing, the delivery schedule has not exceeded. Major project is P17 Alpha. First ship, our delivery is August 2025, and we are hopeful that we will deliver prior to that. See, I just mentioned earlier when my introductory talk that the first activity when we are confident of delivery of a ship is the harbor trials. We have completed the harbor trials, and we intend sending the ships for the first contract of trials with customers. We are confident of delivering the first ship well ahead of the contract delivery ship. We are not unduly concerned about, unless some force majeure condition happens, we are not unduly concerned. Thank you. Thank you, sir. Thank you, everyone. With this, we conclude the Q&A session. I would request Cmde P.R. Hari sir to give his closing remarks, and thereafter we can join us for the high tea. Thank you. Sir, over to you. Thank you, ladies and gentlemen. As I mentioned, it is always a pleasure. Because I am not well today, because I have been traveling for the last 4 days in and out of Kolkata. I mean, Kolkata to Bangalore to Kolkata, back today to Bombay, next week Delhi. I am a bit down, but after interacting, I am back to normal. Thank you. Thank you. Thank you, sir.