If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from [inaudible] . Please go ahead.
Good morning, sir. So my first question is regarding the number of hot boxes [inaudible] . So I missed the opening remark, or if you already mentioned that. Hello?
Hello.
Hello. Yeah, I can hear you now?
Yeah, yes, yes.
Yeah, thanks for the call. So we have delivered about 814 hot boxes this quarter, which is in line with the 3,300 hot boxes that we're supposed to deliver in this financial year. And also, we have delivered 22 units of electrolyzers this quarter. And apart from this, in Q2, we are expected to deliver a lot of coolant, and especially deliver about 990 hot boxes this quarter. There has been a very increased demand from the Bloom Energy customer. And also, they have released orders also for further 140 servers, which have informed the stock exchange last week. So we are expecting improved demand and coming back to the higher prices moving forward as well in the coming quarters, which we'll know further as we move forward.
Okay, sir. But under any [inaudible]. So how much will you have actually delivered from the electrolyzer [inaudible]?
We have excluded all the existing orders that we have on electrolyzers, so we're expecting further orders coming in, but we don't have a clear idea right now on when exactly we'll get the further orders, but definitely, Bloom is moving very aggressively in terms of implementing various projects in electrolyzers, so as and when the orders are booked, we'll get back-to-back orders from them, and once we have it, then we'll definitely make it.
Okay. Secondly, on this aerospace unit, which we are going to start, what is the actual product we are going to make here? And on the oil and gas sector, we are expecting orders. [inaudible] ?
Basically, aerospace, we are working with various MNCs. For example, as you mentioned, with IAI, GKN Aerospace, Thales, etc., for various of their requirements in the aerospace sector. And we've already done the first articles. Now we have volume production mode. So we have seen growth in the revenues coming in from this sector volume this year. As compared to last year, last year we had INR 108 crore or INR 10 crore in terms of first articles. This year we're looking for INR 70 crore plus. So that's a substantial improvement in the aerospace revenue itself. So once this unit is commissioned, we'll see a lot more increase in terms of revenue growth coming in from this, which is being an exclusive state-of-the-art plant which we are commissioning shortly in Hyderabad itself. So that's where we stand.
And as far as the oil and gas is concerned, we have just discussed with a number of customers. And we are looking at executing certain First Articles this year, and then we move into volume production next year. And that will also add to a new vertical which we intend to start. And we are progressing very well in terms of discussion with various MNC customers on this line.
[Foregn language] ?
As I mentioned earlier, Fluence has already concluded the discussions with us. The only thing is we have to win orders within India to begin with for us to get back-to-back orders. They are participating in various tenders. So as and when we win the orders, then it will probably come in that particular area. We'll be able to get some orders. But as for the exports are concerned, as I mentioned earlier, we are working with a couple of companies to establish the battery manufacturing units in India. Once that is done, then we'll be able to even handle the exports for Fluence Energy in the long run.
Okay. Lastly, on this order intake, [audio distortion] ?
We are definitely on track. The majority of the orders are going to come in, obviously, from the nuclear sector, which is very clear right now, and once the private player who is getting it, we'll get back-to-back orders from them because we are focusing in the case of manufacturing of the Nuclear Island, which we specialize in that, and also in the Aerospace sector and Clean Energy sectors, we're expecting a lot more orders coming in, including the different sectors as well, so we are definitely in line with what we said earlier about having a strong closing order next year.
[Foreign language] .
Thank you. This is, gentlemen. Anyone who wishes to ask a question may press star and 1 on the touch-tone telephone now. I will repeat. Anyone who wishes to ask a question may press star and 1 on the touch-tone telephone. The next question is from the line of Sunidhi Joshi from [inaudible] . Please go ahead.
Hello. Am I audible?
Yes.
You're audible.
In the press release, you had mentioned about Q2 being very strong and post that, can we expect H2 also showing good momentum? And our guidance for FY 2026 also remains intact?
Absolutely. We have clearly mentioned that it's not about Q1 for us. It's about how we are taking this company forward. We are just 45 days to 50 days from Q2, and we are pretty confident of recording the highest ever revenue for MTAR in the history of MTAR, which is around INR 200 crore. The second half is also going to be very strong for MTAR based on the kind of work we have done over the past eight to nine months. Based on that, our revenue growth, which we have mentioned, 20%-25% year- on- year, is very much intact, including the margins which we mentioned at the end of the year, 22% plus minus 100 basis points. We are right on track with that as well.
Okay. Okay. Fair enough. And it would be great if you could comment on how this breakup would be across all the segments.
You're talking about Q2?
Yeah.
Yeah. So basically, if you look at nuclear, we'll be executing orders worth about INR 16 crore roughly. We are very specific in this because we know what's going to happen. And then we are closing out the Fueling Machine Head contract completely well within the timeframe of NPCIL without incurring any LD charges. So we are well ahead of time. And space and aerospace sectors, we are looking at close to about space, we're doing about INR 15 crore and, and aerospace we'll be doing around close to about INR 20 crore as such. Electronics is doing roughly about INR 37 crore and. And clean energy segment in hydrogen, we'll be doing roughly close to about INR 11-12 crore. And in the sheet metal vertical, we are looking at about INR 17 crore of business coming in, sales coming in.
But then we're looking at the Hot Boxes, which I said, the demand has gone up to 990 units right now from 814 of last quarter, which is far more than what we have anticipated, and we'll be around close to about INR 80-90 crore of sales from there. So this is the approximate depth of the revenues that we're expecting for Q2, and that's why we have mentioned that we'll touch around INR 200 crore plus in Q2 is where we stand right now. That's the breakup of the whole sales.
Okay. Got it. Got it. And also, can you help us note the total L1 orders being bid for the quarter? A ballpark number would also be fine.
This one, can you repeat that, please?
The total L1 orders being bid for the quarter.
L1? You're talking about no, no. Basically, we have bid for a number of orders in the defense sector, in the space sector, in various other sectors, and we are expecting all the orders to come in over the next quarter and next quarter as well. So I can't really quantify that, but it depends on when exactly they will release the purchase orders. So we're waiting for that. We have one order given from defense. We have one roughly around INR 50 crore of orders recently in various lines, in wind turbine assemblies, ramjet engines, and all that. So all these things will come into play for the future years, and those orders are expected to come in anytime now.
Okay. Okay. Thank you, sir. All the very best.
Thank you.
Thank you. The next question is from the line of Meet Jain from Motilal Oswal . Please go ahead.
[audio distortion] what can be a downside [inaudible] ?
I don't see any kind of downside here at all because we are well on track with the revenues for Q2. That's why we specifically are guiding for Q2 as well this year, and we have given also the clear break-up in various segments that we're going to achieve these revenues, and we are right on track with it, so I don't see any kind of downside with this.
Okay. Are you on the [audio distortion] .
Yes, that's right. So we will be achieving margins over 20% plus margin basis points. That's what we're looking at for Q2. And in the second half also, we are having a strong revenue outlook and as well as improved margins. So ultimately, we'll end up with what we have guided in terms of revenue growth with margins of 22% plus margin basis points for this year.
Any guidance on the order book? The closing order book at 2025, including L1.
Yeah. The closing order book price tag will be roughly around INR 1,000 crore. And we are expecting major orders coming in from nuclear, aerospace, defense, and also the space sectors, and the new verticals that we are entering into. So we have estimated all that based on timeframe. Most of those orders will kick in in the second half of this year, and we'll end up with a strong order book by the end of this year.
Okay. Apart from that, in the products and other segments, are we developing any new products? We have two products. We presented very good revenue out of that. So any new products that we have to launch this year or in the coming times?
We have already, yes. We are actually the R&D and the new product development team is working on various products, including valves for defense and space sectors as well, so we are looking at a lot of areas where there are quick wins for us. We are focusing more on that right now, so those things will come into play probably by the end of this year. We'll be able to see the light of [inaudible] those products for sure. Apart from that, which we had mentioned earlier, finally, our roller screws have been proven in the defense department, and they're releasing the certification at the end of this month, and we expect it to be a 100% import substitute for us moving forward.
The government need not further import from Rollvis of Sweden, as we will be the first company who has developed this product, which is useful in all the defense areas and space sectors.
[inaudible] by FY 2025, [inaudible] ?
Can you repeat that? I'm not able to hear you well.
Yes. The new products that will be launching in FY 2025 by the end of FY 2025, and the roller screws also having to prove in the defense, which is always contributing from FY 2025 onward.
Yes. Absolutely, yes, so what was the idea behind this is that we are clearly focusing on various products as import substitute products, and all this will definitely contribute for the future growth in the next financial year, FY 2026 for sure.
Okay and one last question is on this defense, so where are we on the defense JVs that we highlighted earlier?
See, we already have the defense license, but we're looking at the right opportunities and the right partners in terms of the JVs, right? It has to be beneficial for MTAR to move forward with the JVs, so we had a couple of opportunities which we looked at it, but we're not convinced with the kind of returns that we're going to have, but we are still working with various companies to see how best we can do to have a jumpstart in terms of taking this forward, so once that happens, then we'll be able to let you know about it.
Okay. And if you can give us detailed guidance for this year, we'll help you. Thank you.
Thank you.
What's [inaudible] ?
I can't hear you now.
Okay. I just don't understand the detailed guidance for FY 2025.
Yeah, so basically, as I said, we are already implementing the aerospace sector, which we mentioned last time. We are looking at oil and gas as well. We are expecting the first verticals orders to come in sometime this quarter or beginning of next quarter. We are looking at. We are going to use our existing. We have, as I said, most of our equipment are in the building in MTAR. So we are going to use our existing products for what we already implement in the company for the oil and gas field for the first articles. But to establish an independent facility for them, we might look at. We will be shipping a lot of machines from there in a separate facility and also add some additional machines.
We're estimating the requirement, which can be between INR 35 to INR 40 crore, which will enable the company to do volume production for next year. Hopefully, we're looking at about INR 150 crore of revenues coming in from there, from oil and gas sector. So we look at that. So we are working on that still. It's a work in progress. And once that is done, we'll be quickly establishing all this to ensure that we get both those revenues for next year to complete the first articles in the current financial year.
So only around [inaudible] FY 2025?
Yeah. For the oil and gas, still around INR 40 crore anode, and aerospace already, we have mentioned the next requirement, which is already under implementation right now. It should be done by September and fully commissioned by December.
How much is that in particular?
That's roughly, see, we had a two-week facility in Hyderabad, which we are taking for INR 16 crore per year. And we're looking at probably another 20-25 crore of space that we have in there to set up the full flexible state-of-the-art plant for the aerospace industry. That's what we're looking at.
But that hasn't been this quarter under provision?
It's in the process, and that's why I said we are commissioning part of it in September and fully commissioned by December. It's in work in progress and implementation stage. It should be done by December.
[inaudible] .
Thank you. Ladies and gentlemen, just a reminder, anyone who wishes to ask a question may press star and one on the touchstone telephone. The next question is from the line of Harshit Kapadia from Elara [inaudible]. Please go ahead.
Hi. Thanks for the opportunity. Just wanted to understand, sir, on the hot boxes side, have we now completely moved to Santa Cruz from Yuma, or there are still some inventory for Yuma left in the system? That's the first question. And secondly, sir, on the quarter two numbers, you mentioned 200 crore. Is that a correct number? And what margin are you looking at for Q2 is what you had also mentioned?
Yeah. So we have completely moved to Santa Cruz. What is important here is a lot of see. It took some time because a lot of field tests also Bloom has to do as a company, which has been successfully done. And that's how the whole thing has changed right now. And we have completely moved to Santa Cruz block right now, and it's fully implemented right now. And Yuma is completely out of the picture. And as far as Q2 is concerned, I did clearly mention that we'll be doing our highest ever revenue around INR 200 crore and with a margin of 20% less management basis points.
Understood. And where are we in the value chain of increasing our share on the Hot Boxes and the Green Hydrogen chain? You are looking to add more products just from the Santa Cruz boxes as well. So if you can share some details on that, that would be helpful.
Yeah. See, I can't go into specifics, but we are just working on a few of those items right now, the First Articles that have been established, and which will come into play in the next half of the year and in full force in the next financial year. So we're working on those things right now, and probably we'll see some inflection happening over that in the next quarter or so. And as far as the electrolyzers are concerned, as I said earlier, we completely manufacture the entire units for Bloom, and we are looking forward for the new set of orders from them. It depends upon the orders which Bloom will receive, which actually they're going in the right direction, as mentioned in their earnings call as well. And hopefully, we'll get that. It is an independent vertical.
Right now, we have not considered that in our revenue projections for this year. But if it happens, then it will be a separate new vertical, which we have already established.
What kind of opportunity would you associate electrolyzer with?
See, electrolyzers is something very new, right? Production of green hydrogen. So that's something which a lot of countries are looking for. And already, Bloom has established it and already executed some projects. I heard they've also executed one project in Europe as well. So we are looking at that vertical growing really in a very big way. But it would take a little time, but it will definitely happen. We are already there. And hopefully, I know even if we get new orders this year, we are not bad here in our revenue outlook. But definitely, we'll see some kind of revenues coming in next financial year for sure.
Nice. And in terms of client diversification from Bloom, we had also submitted some of our prototypes to some U.S. companies, and we were looking to add more clients. [inaudible] ?
We are actually very strong in that. As I said, we are working with U.S. companies. We are also working with Israeli Aerospace Industries. We are working with GKN and American companies, Thales, European companies. So a lot of other companies we are working with in a very big way. See, in engineering, what happens is we have to build the product. We have to do the first articles, establish it, do the last production. We have gone through all that right now. That's why we are into the volume production right now. We're also getting into the oil field, which I mentioned earlier. So all this will enable us to diversify more and more and strengthen our other verticals in a big way.
Especially with the nuclear sector becoming stronger and stronger for us, finally, because of the orders which will come in flowing for us, I don't see any the nuclear division is going to grow very rapidly over the next time. We'll have enough on our plate for the next 10 years. Plus, a lot of private industries are looking at smaller nuclear reactors to be established. They're working with the government for that, which has been announced in the budget as well. So we have a lot of scope in improving our area because we really specialize in the nuclear division for the last 40 years. All this will enable us to diversify well and drastically reduce the customer concentration risk over the next two years for sure.
Very nice. And on space industry, you have been doing a lot of amount of addition, product addition. So if you can give some highlights, where are we in terms of growth in the particularly space sector? And any pipeline that you can share in terms of the Gaganyaan, etc., which is there and where you will be able to delve more into this?
See, all those projects we're already working with. Since 1989, we're working with them, and we are very exclusive in terms of supplying the liquid propulsion engines, cryo engines for them. And the major product that we are working on, hopefully, they're going to be dispatching it is the Semi-Cryogenic engine for the first time. So we are developing that as well. So it also the growth in the space also depends on the number of launches they do and how they want to take it forward. So we have to look at that. But we are very stable in this space because of our exclusive relationship with ISRO and the kind of technology we have developed for them. And that will continue for us.
Understood, sir. Wishing you all the best, sir. Thank you.
Thank you.
Thank you. The next question is from the line of [inaudible] . Please go ahead.
Yeah. Hi, sir. Thanks for taking my question. Can you speak to the outlook of Clean Energy, and especially Bloom Energy? So what kind of, let's say, the growth that's guiding you in terms of revenue and valuation?
See, as I said, right now, we are seeing a sort of demand from Bloom Energy, which we didn't anticipate. We anticipated, but we were waiting for the time to come in. So if you look at the Q1 , we have done 814 boxes. Now we are doing like 992 for Q2, and probably eventually we'll do such increased requirements from Bloom. We have to wait and see. So we are in line with what we have said earlier. In terms of the number of units we are going to dispatch, probably that might increase or that might subsequently be there. For sure, the kind of growth we are looking at right now. It was like certain requirements which are coming in from them because of the various orders they have won, the kind of outlook they have.
So we would see positive growth coming in from Bloom, as I mentioned earlier. And in the long run, we're also looking at about 18% kind of growth. And we'll also see that kind of growth. Plus, we're going to increase our wallet share with Bloom as well. So I think now we are back on track with Bloom completely, and we're hoping to do better and better moving forward.
Yeah. Thanks, sir. So next question on oil and gas. So what kind of opportunity are you looking in this space? And also, which other clients you are tapping in this space, and what's the, let's say, major companies in this segment, and how would this revenue grow over the next three to five years? Any guidance on that?
See, oil and gas, we have said over the last three to four months, we have discussed with various customers our [inaudible] company was certified. They were very convinced with what our capabilities are. In the past, we had also worked with SLB as a customer. We were talking about 10, 20 years back. So we know that what the oil field is all about. So we have, as I said, most of our equipment is tangible. So we're trying to use our existing equipment and first articles this year, and then moving forward, we're going to establish an independent facility, the volume production next year. So what is the growth outlook?
Yes, this is actually very interesting because we are looking at, as I said earlier, at least about INR 150 crore plus for next year. We can exclude if we do the first articles on time, which we will focus on in the current financial year. And in the long run, this vertical can grow as big as Bloom as well, or even more, the existing customer of what we have. So that's our goal in which we are trying to move in.
And adding to that, sir, what kind of projects are you looking in this space, and what is USP? And also, what is the investment in this space you're looking to invest in the next couple of years?
I can't specifically specify, but there are various requirements that have given us. Most of them are assemblies. Some of them are products. There are multiple kinds of requirements that they have. And the investment, as I said, will be roughly around, with existing equipment what we have and the additional around INR 40-45 crore of equipment that we need to implement, which is not much based on the existing techniques already missions that we have right now. So that's the kind of outlook we have this year to implement.
Thank you. Thank you so much, sir. Thank you.
Thank you. The next question is from the line of [inaudible] . Please go ahead.
Hi, sir. Thank you for the opportunity. See, I wanted to check on nuclear power order for the same because we have received a notification also that Megha Engineering has already received the order from the Kaiga 5 and 6. So when can we expect our inputs to sort of build enough, which we are actually expecting to the extent of INR 500 crore this year?
So it should be in the second half, right? So the tender has won with them. So basically, the process is that NPCIL has to release the orders to them in terms of the orders. So we are hoping that we will definitely get it in second half of this year.
And, sir, apart from that, we have also talked about 14 refurbishments for this nuclear reactor fleet, which we were expecting. So, any sort of inputs from that as well would be contributing to our input in a certain way?
Yes, that's for sure. They're saying that by mostly that's a fast track project. Any refurbishment of reactors are on fast track, so this is a Tarapur reactor which we are taking up, and that should be roughly they're saying they'll throw the tenders in the Q3 of this year, so if they throw the tenders in the Q3 of this year, we'll have those orders coming in beforehand.
Okay. And, sir, revenue build-up, it would be seen from FY 2026 for the nuclear segment?
Yes, for sure. Definitely.
Okay. Sir, apart from that, on the oil and gas issue you were talking about, if we are able to sort of qualify for our First Article, any margin differential which we are seeing in terms of how margin-effective these orders could be for us going forward, say, from the perspective of next three-to-four years?
We don't want to specify the margins in this space. The space is we are entering only into a very niche area of oil and gas. Unless the margins are reasonably good, we don't do that. We have done that study already. It is in line with the kind of margins we are looking at on the long-term basis, somewhere between 24%-26% EBITDA margin. It's not a big issue.
Okay. And sir, any incremental CapEx issue to be requiring to set up this, or already we have the sort of facilities to make these orders on the oil and gas?
As I mentioned earlier, we do have some facilities, but incrementally, we might have to spend around INR 40 crore plus to establish an independent facility for this volume production to begin with.
Okay. Thank you, sir. That's all from my side.
Thank you. Ladies and gentlemen, just a reminder, anyone who wishes to ask a question may press star and one on the touch-tone telephone now. I will repeat, anyone who wishes to ask a question may press star and 1 on the touch-tone telephone. The next question is from the line of [inaudible] . Please go ahead.
Thanks for the follow-up. So, any [inaudible]?
I did mention the roller screws. We are getting full certification by end of this month. And once that is done, it will be certified as a 100% import. So that's taken care of. And we are working on various other products which plan the expansion, which is being done by R&D and NDT. So once we do that, then it will also add on to the portfolio for the future coming years. So we're working on that.
Hello? Is the line of [inaudible] ? We will move to the next question. The next question is from the line of Mara and Anik, an individual investor. Please go ahead.
Good morning, [inaudible] sir. The first question is, in union budget, Finance Minister has allocated some amount to small nuclear reactors. The subsidies are on that. Any benefits so far from that for us?
Yeah, absolutely. Because that's something which we have worked upon in the last earlier years. We still don't have full clarity on that. Whether it's going to be 220 MW or even less than that, we don't have the clarity. But they're saying it's going to be 220MW for a lot of private players who wanted to establish those facilities. So and there have been a lot of such reactors, nuclear islands in the past. And it depends on when they're going to get implemented. It might take a year or a couple of years, but we have to see how it goes.
Right. So far, no orders from the SI industry?
Of course, we've signed these orders overnight, right? We take at least they have to implement that. They have to. It's a process by itself, so we have a great opportunity if that gets implemented, and they're pretty serious about that.
Sure. Thank you. Now, the second question is, the revenue decrease that we have seen in this quarter, Q1, for the next three quarters to FY 2025, the revenue run rate that we have to have is the same amount of revenue that we generated in FY 2024 as a whole. So we are targeting 20% increase in the revenue YoY. So in this case, do you see that it is achievable, sir?
Yes. I've clearly mentioned in my earlier responses that in Q2 itself, we're doing our highest ever revenues of INR 200 crore per annum, right? And then we move forward with the second half being much stronger. So we will be on track with that growth guidance of 20%-35% year-on-year basis.
Sure. Thank you. And my last question is, sir, what do we see ourselves as? A big tech company, or which vertical where are we in the industry as leaders, or we would like to be? Because see, the question comes from the fact that we have expanded to many verticals, right? So which is our favorite, and where do we like to grow?
See, ultimately, the verticals are different, but everything is technology and engineering behind it, right? You can name it differently. You can call it nuclear. You can call it space. You can call it aerospace or whatever it is, or clean energy. But ultimately, it's our technology which we have built over the years. That's our strength. And that's how we're able to enter into a number of verticals. And that's the kind of technology we have in terms of manufacturing and in terms of doing various things in this company over the years. That's our basic strength, and that's how we're able to enter into different verticals. Ultimately, it's the engineering which helps.
Sure. And if I'm using the last one, the domestic contribution is higher in percentage terms. Is it due to the overall reduction in the revenue for this quarter, or is it really something which is happening on domestic sales right now?
See, domestic has been low in Q1, but moving forward in the next three quarters, the domestic sales are going to be higher because we have a big lot of work in progress in building these dispatches for the next quarters in the domestic sector in various areas. So that's why when I've given the Q2, also I've mentioned that. So we are actually converting all of them into sales, which you will see happening in the next three quarters. So that's what it is.
Sure. Thank you. And the last one, the clean energy and civil nuclear vertical has shown the least revenue compared to others in terms of contribution. I have heard you saying that that would be compensated in the next quarters. But why such a least order turnout or order completion in Q1?
See, in nuclear, we're actually building the Fueling Machine Head, which has closed in the contract, which we are doing it in Q2, so that was work in progress, so that means the contract is getting closed already in Q2. That's the main thing, and the rest of the other sectors, a lot of work in progress has been done. All the supply chains will happen in Q2. That's the main reason, so they're all long-term projects, which we are closing out in the next three quarters.
Sure. And employee increase in expenses on employees, is it due to clean energy and aerospace vertical that we are entering? Is it due to that the increase?
See, there are two things there. See, we are building up our management branch with employees. The future growth of this company. Now, as I said earlier, it's at 20% right now in Q1, but eventually, at the end of the year, it will come down to 16% based on our revenue growth. So it's also important to build a strong employee group to keep up with the growth of the company, which is also very critical.
Sure. That helps. Thank you very much, sir.
Thank you. In the interest of time, this will be our last question. I would now like to hand the conference over to the management for the closing remarks.
I'd like to thank everyone for attending this call today. As I mentioned, we really appreciate all your support. To have patience to get there, we are right on track with our growth guidance and executive guidance for the year. Thank you so much for joining the call today.
On behalf of Orient Capital, we'll conclude this conference. Thank you for joining us, and you may now disconnect the lines.