Ladies and gentlemen, good day, and welcome to the PNC, PNC Infratech Limited Q4 FY 2024 earnings conference call, hosted by PhillipCapital India Private Limited. As a reminder, all participant lines will be in the listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing star then zero on your touchtone phone. Please note that this conference is being recorded. This conference call may contain forward-looking statements about the company, which are based on beliefs, opinions, and expectations of the company as on the date of this call. These statements are not guarantees of future performance and involve risks and uncertainties that are difficult to predict. I now hand the conference over to Mr. Vikram Suryavanshi from PhillipCapital India Private Limited.
Thank you, and over to you, sir.
Thank you, Lisa. Good afternoon, and very warm welcome to everyone. On behalf of PhillipCapital, I'm pleased to welcome you all on the PNC Infratech Limited fourth quarter FY 2024 earnings conference call. We have with us Managing Director of the company, Mr. Yogesh Jain, along with senior management team. We'll begin with the opening remarks from the management, followed by interactive question and answer session. Over to you, sir, for opening comments.
Good afternoon, everyone. On behalf of PNC Infratech Limited, I extend a warm welcome to everyone for joining us today on this call. I have with me, Mr. T.R. Rao, Director, Infra, Mr. D.K. Agarwal, CFO, Mr. D.K. Maheshwari, VP, Finance, and Strategic Growth Advisors, our Investor Relations Advisors. We have uploaded the financial result and investor presentation on the stock exchanges and company website for your reference. Initially, I would like to mention key updates of the industry, followed by operational developments of the company and highlights of financial performance during the fourth quarter and for financial year 2024, post which we will be happy to answer your questions. During the financial year 2023-2024, MORTH, including NHAI and NHIDCL, constructed 12,349 km of national highways, making the second highest aggregate route length constructed in a year in its history.
However, as per the industry reports, road construction activities during financial year 2025 would be lesser and will be in range between 11,100 km and 11,500 km. This anticipated decline compared to financial year 2024 is largely attributed to much slowdown in projects awarding process during financial year 2024, persistent land acquisition and other issues in already awarded projects. As per NHAI is concerned, during financial year 2024, 6,644 km length of national highways constructed, exceeding the target of 6,544 km set forth, which is higher by nearly 20% as compared to 5,544 km constructed by NHAI during the financial year 2023. MORTH announced plans to integrate an additional 6,000 km of high-speed highways into the country's national highways network.
This ambitious initiative will tremendously improve connectivity and increase efficiency of transportation across the geographies of country. As mentioned earlier, on new contract awarding front, the sector witnessed very subdued activity during the entire financial year 2024. Slowdown in new projects awarding activity will have significant negative impact on the industry over the next two years, particularly in achieving the construction targets and revenues by both authorities as well as by the developers. However, the industry is hopeful that bidding and awarding activity will pick up after the conclusion of the ongoing general election, and large number of projects would be awarding during financial year 2025.
On 16 May 2024, company subsidiary, MP Highways Private Limited, received communication from MPRDC, MPRDC's authority, conveying approval for the extension of concession period for Gwalior-Bhind BOT toll project by two years, nine months, 18 days, that is, up to 25 March 2028. On 8 March 2024, company received a completion certificate from NHAI for Lucknow Ring Road EPC project of value INR 1,069 crore, effective from 29 February 2024. On 7 May 2024, company received provisional completion certificate for Meerut-Najibabad HAM projects from NHAI, with effect from 4 May 2024. Company executed concession agreement with MPRDC for Western Bhopal Bypass HAM project on 7 March 2024. On 26 February 2024, Madhya Pradesh Public Works Department awarded an EPC contract, namely construction of an elevated corridor in Gwalior, for a construction contract value of INR 699 crore.
Company's strong balance sheet and financial prudence continue to result in credit rating upgrades, which enables company to secure debt at competitive rates. Moving on to the operational and financial performance of the company. Out of the company's 28 fund-based projects, three are BOT toll projects, two are BOT-Annuity projects, and 23 are HAM projects. Aggregate bid project cost of 23 HAM project is around INR 30,000 crore, which is one of the largest highway HAM project portfolio in the country. Out of the total 23 HAM projects, company achieved PCOD and COD for 10 projects, and nine projects are under construction. Three projects achieved financial closure, and appointed dates yet to be declared. For one project, company executed concession agreement in March 2024. Regarding equity investment, total requirement for the 23 HAM project is INR 3,092 crore.
As of March 2024, the company already invested INR 1,975 crore, and the remaining equity of INR 1,117 crore is to be invested over the next two-three years. The internal accruals that would be generated over the next two-three years should be adequate to meet the above equity investment requirement. As of 31st March 2024, the company unexecuted order book stands at INR 15,490 crore, which does not include the contract value of two EPC contracts recently secured for an aggregate value of INR 4,994 crore. Upon inclusion of these two EPC projects, our unexecuted order book would be over INR 20,400 crore, which is 2.7 x of financial year 2024 revenue.
Out of the unexecuted order book of INR 15,490 crore, highway and expressway contract contribute around 70%, while water and canal projects contribute around 30%. Substantial progress achieved in rural drinking water project under the Jal Jeevan Mission during the financial year 2024 by company. During financial year 2024, company has booked a total revenue of INR 1,906 crore in the drinking water segment, while during the fourth quarter, booked a revenue of INR 555 crore. I would like to share that one of the company's subsidiary, namely PNC Kanpur Highways Limited, executed a settlement agreement with NHAI on ninth May 2024 for INR 389.86 crore under the Vivad Se Vishwas Scheme, which is expected to be received in quarter one of financial year 2025.
Further, another subsidiary of the company, PNC Raebareli Highways Private Limited, received INR 117.15 crore from NHAI in April 2024, pursuant to a settlement agreement executed with NHAI Vivad Se Vishwas second scheme. Now I would present the result for quarter ended March 31st, 2024 and financial year 2024. Before discussing financial performance, I would also like to highlight that during first quarter of financial year 2023, the company received INR 37 crore towards bonus for early completion of Purvanchal Expressway Package 6, is included in the revenue of financial year 2023. Whereas, during financial year 2024, the company has received INR 297 crore towards arbitration award for two projects, Dholpur-Morena of NHAI and Gurgaon-Nuh-Rajasthan border of HSRDC, Haryana.
I would also like to highlight that financial year 2023 includes revenue of INR 251 crore from Eastern Peripheral Expressway project, which is not adjusted from financial year 2023 financials. Standalone revenue for fourth quarter of financial year 2024 is INR 2,342 crore, which is higher by 11% as compared to INR 2,115 crore in the fourth quarter of financial year 2023. The EBITDA for the fourth quarter of financial year 2024 is INR 565 crore, which is higher by 101%, as compared to INR 281 crore in the fourth quarter of financial year 2023. The EBITDA margin for the fourth quarter of financial year 2024 is 24.1%.
The profit for the fourth quarter of financial year 2024 is INR 402 crore, as compared to INR 184 crore in the fourth quarter of financial year 2023, a growth of 118% on year-over-year basis. The PAT margin for the fourth quarter of financial year 2024 is 17.2%. The standalone revenue for financial year 2024 is INR 7,699 crore, which is higher by 9% as compared to INR 7,061 crore in financial year 2023. The standalone EBITDA of financial year 2024 is INR 1,277 crore, which is higher by 34% as compared to INR 954 crore in financial year 2023.
The standalone profit for financial year 2024 is INR 850 crore, as compared to INR 611 crore in financial year 2023, with a growth of 39%. The PAT margin for financial year 2024 is 11%. Consolidated revenue of fourth quarter of financial year 2024 is INR 2,600 crores, as compared to INR 2,305 crore in fourth quarter of financial year 2023, a growth of 13%. The consolidated EBITDA for fourth quarter of financial year 2024 is INR 736 crore as compared to INR 411 crores in the fourth quarter of financial year 2023, a growth of 79%. The EBITDA margin for fourth quarter of financial year 2024 is 28.3%.
The consolidated PAT for fourth quarter of financial year 2024 is INR 396 crore as compared to INR 146 crore in fourth quarter of financial year 2023, a growth of 171%. The PAT margin for fourth quarter of financial year 2024 is 15.2%. The consolidated revenue for financial year 2024 is INR 8,650 crore, which is higher by 9% as compared to INR 7,956 crore in financial year 2023. The consolidated EBITDA for financial year 2024 is INR 2,005 crore as compared to INR 1,600 crore in financial year 2023, a growth of 25%. The EBITDA margin for financial year 2024 is 23.2%.
The consolidated profit for financial year 2024 is INR 909 crore as compared to INR 658 crore in financial year 2023, a growth of 38%. The PAT margin for financial year 2024 is 38%. As on 31st March 2024, our net working capital cycle is 102 days, as compared to 106 days as on 31st March 2023. Our net worth on a standalone basis is INR 4,781 crore as on 31st March 2024, whereas total standalone debt is INR 382 crore. The total cash and bank balance as on 31st March 2024 is INR 616 crore. We have a net surplus of INR 234 crore. This translates to net debt to equity of 0.08 x.
On consolidated basis, our net worth is INR 5,185 crore with total debt, whereas total debt is INR 8,016 crore as on 31st March 2024. The total cash and bank balance, including current investment, is INR 1,793 crore. This translates to net debt equity of 1.52x . With this, we now open the floor for question answer. Thank you.
Thank you. Ladies and gentlemen, we will now begin with the question- and- answer session. Anyone wishing to ask a question may please press star and one on your touch-tone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Shravan Shah from Dolat Capital. Please go ahead.
Yeah. Thank you, sir. Sir, just first, on the guidance front, so on the revenue front, what's the guidance for FY 2025 and EBITDA margin? Hopefully, you will be maintaining at 13%-13.5%. And also on the order inflow front, given the kind of INR 5,000 crore that we have already received, how much more we are likely to get, and it's also possible in terms of segment, HAM, toll or the water and the other segment, if possible.
Thank you. See, for FY 2025, we expressed our guidance of 10% over FY 2024, given the prevailing position. And, EBITDA, as every industry knows, that, the competition has increased, particularly during the last two to three years. So, to secure the projects and all, then we have to be also competitive at par with the industry. So the EBITDA margin for the FY 2025, we are expecting around 12%-12.5%, which is slightly lesser than what it was earlier. And on a business development front, as you had said, that we had already secured INR 5,000 crore worth of projects, so we are expecting another INR 8,000 crore -INR 10,000 crore of new projects before end of FY 2025, because there is a robust pipeline of projects are there which are for bidding.
Yes, the mix of bidding is concerned, we continue to bid EPC and HAM projects, which will be our priority, and we are also looking at the BOT opportunities, but there, we'll be very cautious and we'd like to bid very comfortably in case of BOT toll projects where the revenue risk is involved. Thank you.
Sir, when we are saying that we are lowering our EBITDA margin from 13.5% to 12%-12.5%, given the whatever the orders that we have received that will be flowing into revenue this year, the new orders may be, maybe will not be contributing that much. So does that mean that the new orders are even coming at much lesser margin? And maybe going forward from FY 2026, maybe this margin number can, can further come down to 11%-11.5%?
No, we don't expect that, it will further come down to 11%-11.5%, going forward during the FY 2026 and onwards. But, this also, 12.5%, we are expressing that, we'll be executing the new projects also, some sizable amount during the FY 2025. The new projects, as we said, as we said, that, the competition will be at a higher level, so we'll be bidding more competitively. So as far as the existing projects are there, that will be around 13%. The mix overall will be around 12.5%, and we don't expect that this will, come down further, significantly during FY 2026 and going forward.
Okay. I've got it. Secondly, needed a couple of data points, project-wise, order book and equity for 2025, 2026 and 2027, if possible. And before that, if possible, 10% growth on the revenue we are looking at, for FY 2025. For FY 2026, if we get another INR 10,000 crore, INR 5,000 crore, INR 15,000 crore, then also for 2026, also similar kind of a growth, or it can be a much higher growth that we can look at in FY 2026?
It is speculative as of now to say how these things will unfold, but the growth should not be less than 10% in FY 2025... FY 2026.
Yeah. So first, in terms of the equity breakup for 2025, 2026, 2027, and then the project-wise order book I will ask.
The total equity requirement on 31st March is INR 1,117 crore, and out of that, INR 640 we require to infuse in the month year FY 2025, INR 330 in FY 2026, and INR 145 in FY 2027.
Okay. In terms of the project-wise order book, so first is the irrigation project is how much?
Irrigation, INR 932 crore, sir.
INR 932 crore. Second is this Hardoi project, which was INR 424 crore as on December.
It is 268, Hardoi 268, and Mathura Bypass traffic, 184. Challakere, 92.
Okay. This Gajraula-Devinagar is 168?
Yes.
Okay, 168. And, Haryana, rail project?
That's 7:45.
7:45. Okay, got it. And the retention money, mobilization advance, and HAM debtors?
Advance from client is INR 417 crore, and retention is INR 130 crore, sir.
Okay. HAM debtors and water debtors, if possible.
HAM debt is INR 660 crore.
Okay. And water debtors, sir?
It is INR 920 crore, sir. INR 920 crore.
Okay. Thank you and all the best, sir.
Thank you.
Thank you. The next question is from the line of Sudarshan from Max Overseas. Please go ahead.
Good afternoon. Thank you for taking my question. Sir, there was an asset monetization of 12 projects that you had announced few months back. Can you please tell us when is that money going to be received? And any debt reduction plans of the company?
...As we have discussed earlier, that there are two phases in our monetization out of 12 projects. In first phase, there are seven projects, and in second phase, there are five projects. Mostly, we have received the. There are certain condition precedent which we have to fulfill, and major are NOC from lenders and NOC from authority NHAI. So most of the majority of the lenders of first tranche assets have already been received, and others are expected within next four-six weeks. And as regards the NOC from NHAI, financial consultants of NHAI reviewed the NOC application and observation made by them have already been clarified, complied with. We are closely following up with finance consultant technical department and project implementation unit of NHAI. For the approval process, NOC from NHAI for the first tranche of assets expected by middle of July.
We are expected that we should receive the payment of first tranche, which is INR 5,050 enterprise value, by 31st, 30th of September.
Okay. And, sir, any debt reduction plans after this money is received?
Yes. Certainly, in the total debt in current project is INR 6,479 crore.
Mm-hmm.
Yeah, yeah.
It will reduce.
It will reduce.
It will reduce directly.
Okay, sir. Thank you. Thank you very much.
Thank you. We'll move on to the next question that is from the line of Bharani Vijayakumar from Avendus . Please go ahead.
Yeah, good afternoon. What is the order inflow that we saw in FY 2024 for PNC in INR crore?
As our MD has mentioned, the awarding activity during the FY 2024 was very subdued. So we got one HAM project of INR 1,174 crore, and we got one EPC project of INR 699 crore, which comes to INR 1,873 crore. That was the order inflow during the FY 2024.
Okay. How much was the awarding done by NHAI in kilometers in 2024?
That we don't have readily available, figures are not readily available with us. We'll share you separately. However, whatever the awarding target of NHAI was set forth before beginning of FY 2024, so what awards they made is much lesser than that was set forth.
Okay. And, according to you, how much is the near-term bidding pipeline of NHAI, say, in EPC, say, HAM and BOT separately, sir, where we would be bidding?
See, there is around 90, over 90 projects we have identified for evaluation, which comprising 20 EPC projects, around 60 HAM projects, and 30 DB, DBFOT toll projects, for a total value of more than INR 100,000 crore. That's what... Otherwise, out of that, see, maybe next two, three months, these projects need to bid out. But as NHAI as a whole, they floated more than 150 projects with an aggregate value of INR 150,000 crore. So the projects identified by us for bidding should be around INR 100,000 crore worth of projects.
Okay. You are telling it would be bid out, this 150 number of projects to be bid out in FY 2025, right?
Yes. Yes.
Okay. Do you see any preference for BOT projects first before EPC and HAM projects are awarded?
No, no. Our order of preference would be in the sequence of EPC is our first preference, followed by HAM, then our last preference would be BOT toll.
I'm asking for NHAI, sir. So is NHAI going to prefer BOT?
NHAI definitely prefer BOT, but NHAI is also on, ministry is also having an internal evaluation system. Until unless BOT projects are viable on a self, on a standalone basis with within limited grant, that's what they'll be providing. So otherwise they are going on a HAM model, because BOT projects should be self-sustaining, and that they should be... Sufficient revenue should be coming from. So they just can't go for a BOT project BOT mode for all the projects what they are anticipating.
Okay. And, in the recent MSRDC projects that we won, how much was the competition and how much margins we are expected to make for specific projects?
The competition, there was substantial competition by all big player, and we are expecting an EBITDA margin of, as we said, between 12.5 and 13.
Okay, last question on this, arbitration that we received in the Vivad Se Vishwas scheme. So this arbitration money we had booked in 2024, that is Q4, FY 2024, has it been received by us or yet to be received?
Yeah, we are-
Till now, we have received all it.
FY 2024, we received, before 31st March, 31, 31st March.
It is around INR 300 crore.
INR 295 crore.
INR 255 crore.
In one of the projects under Vivad Se Vishwas is INR 255 crore. Apart from we also received INR 42 crore in another project of EPC of HSRDC.
... what would be the adjusted PAT and EBITDA for FY 2025 apart from this arbitration?
That there is a chance that it will be 12.5%. If you don't consider the arbitration awards that we'll be getting during FY 2025.
13.3.
No, FY 2025, sir.
No, I'm sorry. I asked for 24. What would be the adjusted EBITDA and PAT?
24, I stand corrected. It was 13.13%. Yeah, yeah. I stand corrected.
Absolute number can you give, sir, EBITDA and PAT, adjusted for the one-off income?
It is INR 980 crores, sir, without taking the consideration of arbitration, EBITDA margin. INR 980 crore.
980. And PAT?
That is INR 630 crore.
Okay, thank you. I will come back to you.
Thank you. A reminder to the participants, anyone wishing to ask a question, may please press star and one. The next question is on the line of Rohan Kamath from Tiger Assets. Please go ahead.
Yeah. Hi, sir. I have two questions. One is, could you provide me details of industry-wide breakup of the current order inflow?
The expected order inflow, you are telling?
Yeah, I want to know that could you provide a detailed industry-wide breakup of the current order inflow?
Interesting. So, see, whatever order, unexecuted order book is there, as mentioned by colleague, it's more than 70% is the highway and expressway projects, and around 30% is from our rural drinking water and AP canal project. So that is the only two segments primarily we are operating. One is the roads and highways, and another is the rural drinking water and small irrigation. That is the breakup.
Okay. And, I want to know, what is your order inflow guidance for FY 2025?
FY 2025, we had already received projects worth INR 5,000 crore. Apart from that, we are expecting another INR 8,000-INR 10,000 crore. So the cumulative, it would be around INR 13,000-INR 15,000 crore during FY 2025 order inflow.
Okay. Okay. Thank you. Thank you so much.
Thank you. The next question is on the line of Vaibhav Shah from JM Financial Limited. Please go ahead.
Yeah, thank you, sir. Sir, if I remove the exceptional part from the revenue for the quarter four, so there was a 3% decline in the total revenue. Whereas there was a significant growth in the water revenue on a YOY basis. So what has led to the weak revenue on the highway side? Is there any project-specific issues in the quarter four?
See, quarter four of FY 2024, vis-a-vis the quarter four of FY 2023, what has happened during the FY quarter four, we got the PCODs for quite a few projects, right from starting from November and October. So these projects we achieved and completed, so the revenues were a bit lesser in compared to FY 2023, when these projects were peak in its execution. So from particularly in the road sector. So there is a very marginal decline in Q4 of FY 2024 in comparison to Q4 of FY 2023. Otherwise, there is no other major reason. That time those projects were in peak, now those projects are in a completion stage.
Are there any slow-moving projects in the order backlog right now, which are under execution?
No. All, most all projects are going as per the schedule only. There is no major slowdowns in any particular project.
Sir, for the JJM projects, what revenue do we expect for FY 2025?
Sir?
For JJM, JJM, revenue for FY 2025.
For FY 2025, our guidance for the JJM is INR 2,500 crore.
Okay. And sir, when do we expect to receive the ADs for the HAM projects, for the four HAMs?
See, one of the three HAM projects that is Varanasi to Kolkata, we are expecting maybe in a couple of months, maybe before July. And the other two projects, land acquisition is in progress, so we expect in the current financial year. And similarly, for Western Bhopal Bypass of MPRDC, we executed the concession agreement in the month of March. So NHAI has got time to final prepare the appointed date and finance over there. So that also we are expecting in Q3, appointed date.
Okay. And sir, lastly, when do we expect to start the work for the MSRDC projects?
See, now-
Last quarter. We are expecting in the last quarter.
Sir, last quarter.
First quarter of...
Current financial year.
Yeah, current financial year.
In the last quarter or the third quarter?
The last quarter.
Okay. Okay. Thank you, sir. Those are my questions.
Thank you. The next question is from the line of Parikshit Kandpal from HDFC Securities. Please go ahead.
Hello? ... No, no, first, first question is on the phase one of, which is what, INR 5,050 crores. So how much is the equity value in this, which you will realize?
Equity value, first stage is around INR 1,100 crore.
How much, sir?
1,000, 1,000. INR 999 crore.
This is the receivable which you will get, right? And that, INR 4,000 crore will go towards debt.
Yes, 1,000 equity we have ensured, and we are expected to receive around INR 5,015 crore is the enterprise value. Okay.
In that, how much is the debt, sir? That is what I'm asking. Out of INR 5,050, how much is debt?
INR 3,560 crore.
Okay. So INR 5,050 minus INR 3,560 is the equity realization or the inflow to you? Okay.
Okay.
And, second question is on the bid pipeline, sir. So if you can help us understand what is the bid pipeline segment-wise in the state of UP, both on the state side and NHAI side?
We have a big pipeline, as you mentioned, around 150 projects NHAI has floated. Out of that, we identified around 100 projects. But right now, the statewide breakup is not readily available. We will share you separately. Share you-
But what about the state projects? Any major, like, after Ganga Expressway, do you think any other projects are lined up for the state of UP, in metro, water, or Jal Jeevan Mission metro, state highways, any pipeline there which you can let us see in the next six months?
No, as of now, none of the states has declared any major projects announced.
In road sector.
In the particularly in the road sector.
What about the JGN pipeline, sir? Any sense on the JGN pipeline for UP state?
In UP, almost all five phases they awarded, UP you don't see. We need to see the other states, but the clarity will emerge only after post-general elections. Because, the governments are not, coming out with any concrete plan till general elections get over.
Okay.
Only in the next quarter, we'll be in a better position to assess what would be the bidding opportunities across the states, across the sectors.
Okay. So now you are highlighting it's INR 15,000 crore of inflows, when this year is expected to be a truncated year towards ordering. So what gives you so much of confidence? Because we don't see any major project announcement by state government. So you have already won INR 5,000 crore, but another INR 10,000 crore, we need to rely heavily on how NHAI does, and in that, you are also focusing more on EPC and HAM. So in absence of any major state projects, how do you think that you will reach that number of INR 15,000 crore?
See, historically, our revenues and our BD has been from the NHAI only, if you see it. Now, as I said, 150 projects amounts to INR 1.5 lakh. As our managing director said, there are 6,000 kilometers of high-speed highways, which would roughly translate into 2,000, 2.5 lakh crore to 3 lakh crore. Definitely government will expedite these projects. We are bit confident that the total pipeline during the FY 2025 will be more than INR 200,000 crore. It could be even touching INR 300,000 crore. In that sense, that, what we assuming, INR 8,000-INR 10,000 crore is not an unrealistic figure.
Okay. So this is the last question on this Vivad Se Vishwas, this scheme. So, how much is the total pending collections or claims which is yet to be recognized or received, though it has been awarded or settled, but yet to be recognized and when we expect to recognize it?
We are actually INR 398.6 crores, for which we have signed the settlement agreement with NHAI. That we are expecting maybe next 10-15 days, we are expecting releases of the said money. It is INR 398.6 crores.
This is over and above the INR 255 crore we have already received in Q4, right?
Yeah.
Okay.
This is over and above INR 255 crore we received during FY 2024, and also INR 117.15 crore we have received during Q1 of FY 2025. Apart from 255, we had also received INR 117.15 crore in April 2024. That means Q1 of FY 2025, which will reflect in Q1 results.
Actually, in FY 2025, we are expecting in PNC, INR 378 crore in two projects, Kanpur-Kabrai and Raebareli-Jaunpur, in PNC books.
Remaining in activities, yeah.
The remaining in activities.
Yeah, but it will Morena in an annuity, it will reflect.
So you are saying that 100 and, so 255, just to reconcile, 255 has been done in Q4, 117 you have received in April, 398 is expected in next 10-15 days. And beyond that, is there anything else which is there in our favor yet to be, like, closed or signed?
No.
Okay.
Because there are only three projects which qualify for settlement under the Vivad Se Vishwas scheme two.
Okay, sir. Okay, sir, thank you and wish you the best. Those are my questions. Thank you.
Thank you. The next question is from the line of Prem Khurana from Anand Rathi. Please go ahead.
Yeah, thank you for taking my question, sir. My first question was with respect to our water orders. I think, I mean, if I heard you right, you said you have almost around INR 900 crore of debtors from water orders. And I imagine that this is against INR 1,900 crore of revenues that you've done, which works out to be almost 180 days sort of cycle. So is it in line with how you anticipate it to be, or this is, would you say, I mean, this is higher than what would you have, or what you would have envisaged the time of bidding for the orders?
Because when I see it, so this INR 900 crore technically means, I mean, some of these payments have been due for more than 4-5 months, because it's the last two quarters together, you've done almost INR 1,100 crore of revenue. So do you, do you see this to correct, or this would remain like this next year as well? The cycle, the data cycle with water orders.
No, no, that data cycle has not been like that. Only this, we are having this constraint and we are facing issue only in the Q4. What are the, what our billing we have done, we have done around INR 500 crore of billing during the Q4 by March thirty-first.
Mm-hmm.
After the announcement of election, and also the present government only passed the vote on account budget for three months, that is up to June, with a very limited allocation in the Jal Shakti ministry and the Jal Jeevan Mission. So the whole project, 50% grant is provided by Government of India, and remaining 50% matching grant is given by the state government. Because of the vote on account and the limited budget allocation, so there is a paucity of funds from the central government, which is resulting in the slowdown in the disbursements. Last month, this month, Government of India released INR 1,800 crore, and matching grant of another INR 1,800 crore released by state government.
We are gradually getting the payments, so once these general elections are over and once the full budget is presented and approved by the Parliament before thirtieth of June, so going forward, from July onwards, the payments will be streamlined, and we don't foresee that any major issue will be getting the payments from the Jal Jeevan Mission.
Sure, sure. So if I said, again, that June again would be, I mean, the data would be on an elevated side, because, I mean, till the time you get to see the central government get settled, till then, I mean, it will be a little slow, I mean, in terms of payment cycle, right?
Yes, yes. It's only temporary phenomena. We don't foresee-
Election.
Yeah, yeah, due to general elections and the, since the outgoing government could able to pass only vote-on-account budget for three months.
When I look at the presentation, so our net working capital cycle has gone up from some 73 odd days to 102 on a sequential basis, I mean, compared to what was reported in the presentation for the nine months. So this entirely would be on account of this water order, or are we seeing some buildup on the road side as well?
It is mainly on account of the water debtors. If you will see the, compared with the March 2023, it has reduced from 106 days to 102 days, sir.
Sure, sure. And sorry, so these MSRDC orders that we've emerged N1 with, I mean, what I gather is, I mean, most of the bids are almost 30%-40% higher than the base cost estimates. I mean, could there be a situation wherein the government comes and starts negotiating with the successful bidders, or you need them to kind of go ahead with the same bid there in place? Because, I mean, last time when you had similar sort of situation with Samruddhi, there were some sort of renegotiations, right?
So, is it fair to assume, given this aggregate substantially higher than what they were envisaging, what the base cost estimate was? I mean, we get to have some sort of renegotiations again, and which could mean, I mean, it could take little longer than what you generally would build in to kind of start execution at the ground.
We are expecting negotiation within the next week. Next week we are expecting, but we have not received any letter from MSRDC till now.
Okay. Okay, sure. And the third one was on this arbitration claim under Vivad Se Vishwas. So the balance money, which is, I mean, the INR 170 odd crore that you received in April, and then another INR 390 or 400 odd crore, are supposed to be with the SPVs, right? And the money would flow through to the parent, right? Which is how it'll work. So only INR 378 out of this INR 500 odd crore plus would reflect in standalone. So do we have any receivables due from the SPVs and which, against which these this money, INR 378 crore would come to us? Or how would the path through be? Do we have any costs reflecting in our books of accounts for this INR 378 odd crore in the standalone entity?
No, no, there's no cost on that, entire will be the better one.
Okay. And sir, how would the tax structure work then, in this case? Because the SPVs would receive the money, they'll book that as a part of the income statement, pay taxes, and then the money would come to us, again, would be booked in income statement. Is it, or how would the tax part work with the arbitration claims?
This arbitration claims, whatever the SPV rights are, comprising both the EPC claims as well as the claims belong to SPV.
Okay.
When SPV receives the total amount, the EPC portion will be transferred to the EPC contractor.
Okay.
That will not have any tax impact on the SPV. Whatever the net amount SPV is retaining,
Mm-hmm.
belongs to SPV, will have a tax impact.
Okay, sure, sure. That clarifies. Thank you, and all the very best for future. Thank you.
Thank you. The next question is on the line of Jiten Rushi from Axis Capital. Please go ahead.
So, thank you for taking my question. First of all, congratulations on the win of MSRDC orders. Sir, my first question is on you had said that your FY 2024 PAT is INR 631 crore. Am I right, sir? After the adjustments for this arbitration claims.
Yeah.
What is the tax which you have to, which you paid on the VS, Vivad Se Vishwas claims, which you received INR 296 crore?
... It's 25.168%, sir.
Okay, twenty-five.
Normal tax.
Normal tax, okay. And sir, on the CapEx, so what was the CapEx guidance for FY 2025?
Yeah, last year we have taken around INR 46 crore, and this year we are expecting INR 100 crore-INR 120 crore CapEx.
So this last, this CapEx is largely for the MSRDC project, or this is for the inflows which you are targeting back-ended CapEx?
For the new end projects and MSRDC both.
Okay. And sir, on the appointed date, so, just want to clarify, for the Varanasi packages two and three, when do we expect the appointed date and, and the package six?
Package 6, as you said, that maybe next within next two months, we'll get the Appointed Date. We are expected to get the Appointed Date for Package 6.
Mm.
Package 2 and 3 may take a further time. But, however, we are expecting appointed dates declaration by end of this financial year for both the package, the remaining packages.
Okay, so by Q4, we can expect for two and three, and six by Q2, probably.
Yeah.
You said-
February.
February. Okay, February. Okay. And then, okay, got it. And sir, the enterprise value for the phase two, can you highlight what is the enterprise value and, then can you break it down in terms of the equity and debt?
Enterprise value of first phase is INR 5,015.
Mm.
The second phase is 3,990.
Okay, and what will be the debt and equity for the second phase?
Second phase, debt is INR 2,920.
Mm-hmm.
First phase is 355, 159. The total is 6,479.
Sir, sorry, I missed it, sir. You said, first phase two, debt is INR 2,920, right, sir?
Right. No, second phase, 2920.
292, second phase. Equity would be how much, sir? Second phase.
Second phase, INR 740 we have infused.
7:40. And what you are expecting the EV, total... Actually, EV is the INR 3,990, which you will receive. Hello?
Yes, yes.
Basically, against the EV of INR 3,660, you will receive an EV of INR 3,990. Correct, sir?
No, first phase, debt is INR 3,559, and EV is INR 5,015, first phase.
Okay.
And second phase, debt is INR 2,920, and EV, INR 3,990.
Right. And the equity which you are investing, INR 740, that is what you said, right, sir?
In the second phase, yeah.
Second phase. Got it. Got it, sir. And sir, in terms of the guidance, so, if you say that 10% growth, you, you expect in FY 2026, so, bulk of the revenue should come in FY 2026 in H2 FY 2026. So, like, can we say that in MSRDC, we can see the pickup in execution? Because, so the ordering has happened in the first quarter, and these are the EPC projects, the land acquisition should be faster. Can we, can we not start these projects in H2, like Q3, other than Q4, and, we can, you know, push the revenue growth high in Q4 FY 2025 also?
See, you see, these projects are, essentially in a greenfield nature.
Mm-hmm.
The land acquisition has to be done, and then some further approval and other things will be there. So, what we are hopefully expecting, there will be some sizable amount, will be doing some sizable quantity of work we'll be doing in Q4, which would be realistic.
Mm.
Q3, we don't expect any significant work will be executed. Before that, even agreement signing and other things should be happen.
Sir, land is unacquired, or what is the status of land there, sir?
Some of the land is available, and the remaining land has to be acquired. It is in progress.
So you don't have the ... Okay. Okay. And sir, in terms of the growth for 26, like, again, you said 10%, but now with high inflows, which you are targeting, and we have received inflow of MSRDC, which is front-ended, and... So don't you think the growth and Appointed Dates also for the four projects and on EPC projects of Kalinjar will execute we expect this year? So FY 2026 should be better in terms of execution and growth over FY 2025. If at all, can we have 15%-20% growth?
See, we hope so. That was our briefing, if growth should be more and then should do addition to our stakeholders and shareholder. But as of now, it's before 2 years, saying something growth of FY 2026 should be target, it will be premature. The growth of FY 2026 of 10% over FY 2025 is the growth what we are communicating now. So going forward, maybe in Q2 or Q3 results, so we should be able to tell that what is the growth of that value, whether it will be more than 10% target we have, 10%.
Sir, last question, and from my side on the irrigation project of Andhra. So now again, it is a slow-moving project. So you were saying last time that we might hand it over or... So what, what is the status now? How will we execute, or what is the next step we are targeting to do?
Sir, it's actually, when the project was awarded, it's INR 1,000 crore project.
Mm.
We started with the right earnest and, we are so far, we built around 196 crores, invoices we raise. So we put a part because they have, they have not received the payments from the state government. After fourth of June, some clarity will emerge. But nonetheless, this project being an important project as a part of Rayalaseema drought relief, whichever government comes, they just cannot neglect this project because there's a lot of social issues are involved, and there Rayalaseema is a arid and dry region. So until unless, and also there are two, reservoirs and the irrigation, there is a big high cut of irrigation is there. So we expect whatever government comes, they will, continue with this project, and also we'll release our amounts.
Actually, toll numbers. Can you give me the toll numbers or toll collection numbers for the projects?
Yes, yes.
Q4 and FY 2024.
MP Highway total FY 2024, INR 30.4 crore.
Mm-hmm.
Kanpur Highway, 95.6.
Okay.
Bareilly, INR 51.5.
Okay.
Bareilly, INR 62.4.
Mm-hmm.
RBJ NUT, INR 128.6.
For Q4?
Q4 MP Highway, 6.38.
Mm.
Kanpur Highway, 24.6.
Okay.
Bareilly, INR 12.5.
Okay.
Bareilly, 15.8.
15.8, okay.
RBJ, 32.16.
Okay, sir. That's all on my side. Thank you and all the best.
Thank you. Thank you.
Thank you. The next question is from the line of Shravan Shah from Dolat Capital. Please go ahead.
So just a clarification. Sir, when we say for MSRDC, the negotiation can happen next week, any broader idea normally how the government tries to negotiate? So broadly, is it from the base cost, they only try to negotiate 10%-15% higher? That's how it works, or any rough ballpark idea from the, your experience, past experience?
We can't say anything now, but it is proceeding with the Maharashtra government. We will negotiate first and then award.
But at the current price at what we have declared L1, if that is the case, then it is fair to assume that we can have a much higher 17%-18% kind of a beta margin, or this L1 price itself is 12-12.5%. So just to understand, if you further reduce the government negotiation, if it comes down 5-7, then the margin on that, you know?
Yeah. See, whatever rate we have quoted, we have quoted competitively, because there is a substantial competition was there, so we quoted competitively, with the EBITDA margins, what we assume. But we can't disclose being a proprietary thing. Now, we can't say that what marginal margin we quoted and what would be the thing. But whatever negotiation is there, we thought, we assume that it would be very reasonable and justifiable. Accordingly, then we will see how the things will unfold. It will be too premature to say anything now.
Oh, okay. Got it. Thank you, sir.
Thank you. The next question is from the line of Parvez Qazi from Nuvama Group. Please go ahead.
Hi, good afternoon, and thanks for taking my question. Sir, I just wanted to reconfirm the numbers that you have given for the asset monetization. So, for the first phase, the EV is INR 5,500 crore. Is that correct?
Yes. INR 5,015 crore. 5015.
INR 5,015. And the debt that you have included is INR 3,564, and equity was INR 991.
Debt was INR 3,559. Yes.
Okay. INR 3,559, equity is INR 991.
INR 999 is equity.
Okay. And for phase two, the EV is INR 3,990, debt is INR 2,920, and equity is INR 740.
Right.
Thank you. Thanks. That's it from my side.
Thank you. The next question is from the line of Shubham Shelar from IDBI Capital. Please go ahead.
Yes, sir, thanks for the opportunity. Sir, the Bangalore number, 10% increase that you mentioned, so this factors the Vivad Se Vishwas couple of amounts that we'll be booking in quarter one, effectively?
No. Whatever 10% guidance we are giving, this is net of whatever arbitration awards we'll be receiving under Vivad Se Vishwas for FY 2025.
When you say net of, it means it includes that? Or it-
It doesn't include.
It includes. Okay. And, second is on MSRDC order. I think you did briefly mention to one of the previous participants, that there could be some sort of negotiation that could happen. So then, 12.5% EBITDA margin that you mentioned, that is on the quoted amount, which you have, in the BF notification you have mentioned. On that 12.5%, it's not negotiation you're already factoring in. Something will be there, and then 12.5% margin will make.
See, this 12.5%, what we have mentioned for FY 2025 and FY 2026 going forward, this is the overall company's income....whatever the percentage of work we'll be executing during FY 2025 MSRDC will be insignificant. This is the thing, we can't say that this particular project, how this particular project will have an impact on the overall business. What we mentioned guidance, this is just for the whole portfolio what we are having.
Right. No, no, I'm not saying for FY 2025, but I think in, one of the queries you did mention, like, you know, MSRDC order margins will be like 12.5 sort of number, which I could, hear it. So just thought to clarify that it is on the quoted amount of what is there in the stock exchanges, or it is already factoring in negotiation?
No, no, we are not informed the stock exchange what will be the EBITDA margin, whatever order we secure. So that the thing to say, as I said, it's proprietary in nature. And also it's something like a very forward-looking kind of a thing, which we don't want to comment as of now, until unless the negotiation process is completed.
Okay, sure. Yeah, that's all from my side. Thank you.
Thank you. The next question is on the line of Gautam Gulzar from Monarch Networth Capital. Please go ahead.
Hi, sir. Thank you for the opportunity. Sir, I just need some clarification on the Vivad Se Vishwas scheme. So you mentioned that, we've received INR 255 crore in Q4, in April, we've received INR 117 crore, and we are yet to receive INR 398 crore, in the next 10-15 days. Sir, my question is, how much of this will reflect in the Q1 books, standalone books of ours?
Q1 standalone books, if you receive INR 398 crore,
2028.
- uh, something, uh-
INR 378 crore will reflect.
Yeah, 378 will reflect in,
Top line, in top line.
On a top line of, standalone basis.
Okay. And, and this INR 378 will include the INR 117, which we've also received in April, or?
Yeah. Yeah, yeah.
It includes.
Okay, so total, in all, we'll have INR 378 crore included in the top line?
Yeah, yeah, yeah.
Okay. Thank you. Thank you.
standalone.
Thank you. Ladies and gentlemen, due to time constraints, that was our last question. I now hand the conference over to Mr. Vikram Suryavanshi for his closing comments.
We thank the management of PNC Infratech Limited for giving us an opportunity to host the call and taking time out for the interaction with the stakeholder. Sir, any closing comment you would like to give?
In case of further queries, you may get in touch with the Strategic Growth Advisors, our investor relations advisors, or feel free to get in touch with us. Thank you.
Thank you, sir.
Thank you, members of the management team. Ladies and gentlemen, on behalf of PhillipCapital India Private Limited, that concludes this conference call. We thank you for joining us, and you may now disconnect your lines. Thank you.