Ladies and gentlemen, good day and welcome to Power Mech Projects Limited Q2 FY 2026 Earnings Conference Call. 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 your operator by pressing star, then zero on your touch-tone phone. Please note this call is being recorded. I now hand the conference over to Teresa John. Thank you, and over to you, ma'am.
Thank you, Shruti. On behalf of Nirmal Bang Institutional Equities, I would like to welcome you all to the Q2 FY 2026 Earnings Call of Power Mech Projects Limited. The management today is represented by Mr. Rohit Sajja , Whole-time Director; Mr. S. K. Ramaiah, Director of Business Development; and Mr. N Nani Aravind , Chief Financial Officer. I will now hand over to Aravind for their opening remarks, after which we will open up the floor for Q&A. Thank you, and over to you, sir.
Good morning, everyone. I'm Aravind, CFO of the company. I have with me Mr. S. K. Ramaiah, Dir ector of Business Development, and Mr. Sajja Rohit, Director of Business Development and Operations. I take this opportunity to welcome you all to our Q2 FY 2026 Earnings Call. The company's performance for the Second Quarter of Financial Year 2025-2026 remained in line with our set targets, reflecting consistent operational momentum. For Q2 Financial Year 2026, the company reported total income of INR 1,249 crore, representing a 19% increase over the INR 1,046 crore in Q2 FY 2025. EBITDA stood at INR 158 crore, up 18% from INR 134 crore in the corresponding period last year, while profit after tax was INR 78 crore, registering a 12% growth compared to INR 70 crore in Q2 FY 2025. The EBITDA margin remained stable at 12.7%, against 12.8% last year, marginally impacted by higher operating costs.
The PAT margin declined from 6.7% to 6.3%, primarily on account of increased finance and depreciation costs. For the half-year FY 2026, the company delivered a strong performance during the first half of FY 2025-2026, maintaining growth momentum across key parameters. For half-yearr FY 2026, the company reported a total income of INR 2,554 crore, reflecting a 24% increase over INR 2,062 crore in half-year FY 2025. EBITDA stood at INR 340 crore, up 33% from INR 257 crore in the corresponding period last year, while profit after tax was INR 159 crore, comparable to INR 131 crore in half-year FY 2025. The EBITDA margin improved from 12.5%- 13.3%, supported by the exceptional revenue recognized from the River Bed Mineral Project in the previous quarter. However, the PAT margin marginally declined from 6.4% to 6.3%, primarily due to higher finance, depreciation, and tax costs.
Revenue mix for the Q2: The company's revenue mix was mechanical business, INR 435 crore, up by 90% from INR 229 crore in Q2 FY 2025, driven by strong traction in industrial power construction projects. Civil segment, including railways and water distribution projects, INR 309 crore, down by 22% from INR 395 crore in Q2 FY 2025, impacted by extended rains in key projects and delayed bill certifications in the water division. O&M, INR 440 crore, up by 12% from INR 391 crore, supported by new O&M orders received during the year. Electrical business, INR 22 crore, up 138% from INR 9 crore of last year FY 2025, due to execution of railway, civil, and signaling telecommunication works during the year. Mining business, INR 31 crore, up by 164% from INR 12 crore of last year, supported by higher off-take arrangement from sale.
Other income of INR 11 crore, compared to INR 10 crore in Q2 FY 2025, mainly on account of margin money deposits, increase in the margin money deposits. The geographical mix for the quarter was 95% domestic, 5% international, while power sector contribution remained at 79%, with non-power sector accounting for the remaining 21%. Revenue mix for six months: For the first half of FY 2026, the company's revenue mix was mechanical business, INR 658 crore, up by 99% from INR 331 crore in H1 FY 2025, driven by strong traction in industrial power construction projects. Civil segments, including railway and water distribution, INR 890 crore, down by 5% from INR 937 crore in H1 FY 2025, impacted by extended rains across key sites and delayed bill certification in the water division. O&M division, INR 837 crore, up 14% from INR 732 crore in H1 FY 2025, supported by new order inflows during the period.
Electrical business, INR 89 crore, up 427% from INR 17 crore in off-year FY 2025, reflecting a strong execution in railway and civil works and signaling and telecommunication works. Mining business, INR 57 crore, up 122% from INR 26 crore in off-year FY 2025, supported by increased off-take arrangement with sale. Other income, INR 22 crore, compared to INR 19 crore in off-year FY 2025, primarily due to higher margin money deposits with banks. The financial parameters were concerned. The company has witnessed a marginal reduction in return on equity from 3.4% in FY 2025- 3.37% in FY 2026, primarily due to higher finance and tax costs, which impacted PAC. Similarly, return on capital employed decreased slightly from 4.73%- 4.58%, driven by lower operating margins resulting from the seasonal factors such as extended rains.
With the anticipated normalization in collections, with continued strong traction in industrial power construction and ramp-up of MDO revenue from the KBP mines starting Q3, both ROE and ROCE are expected to improve in the coming quarters. The company's negative operating cash flow has improved, reducing from INR 166 crore negative in off-year FY 2025 to INR 63 crore negative in off-year FY 2026, primarily due to the realization of receivables during the period. The company is actively engaging with the clients to expedite certification and clearance processes and is confident of realizing the outstanding dues in the coming months. This is expected to further improve the operating cash flow and reduce the reliance on the working capital limits. Net current asset days, excluding cash and cash equivalents, increased from 128 days in FY 2025 to 151 days in FY 2026, primarily due to delays in certification of waterworks and realization of receivables.
These delays have resulted in higher current assets. The company is actively pursuing certification and payment clearance with the client, and significant improvement in the net working capital delays is expected post-certification and realization of bills in the water division. Gross and net debt levels remained well controlled despite delays in certification of water bills and realization of receivables. As of 30 September 2025, the gross stood at INR 839 crore, and the net debt is around INR 360 crore. The average debt-equity ratio as of the same date was 0.37x . The company is focusing on expediting certification and recovery of bills in the water division, which is expected to further reduce the net debt and the debt-equity ratio in the coming quarters. Order book status: During Q2 FY 2026, the company secured new orders worth INR 1,042 crore.
As of 30 September 2025, the order backlog stood at approximately INR 53,776 crore, with the executable order excluding two MDO projects at INR 14,226 crore. In Q3 FY 2026 till date, the company has received new orders worth of INR 2,577 crore, taking the total order backlog of INR 56,353 crore, with the executable order book excluding two MDO projects increasing to INR 16,804 crore. The company continued to actively pursue tenders and is targeting to secure INR 10,000 crore in the new orders by March 2026. During FY 2026, a significant increase in order inflow is anticipated, particularly from the power sector across segments including O&M, mechanical, civil, construction, and BOPEPC. As of date, the company has already secured orders worth of INR 4,889 crore, achieving approximately 49% of the annual target.
The company will continue to prioritize high-potential areas, including industrial plant operations and maintenance, railway and water infrastructure, and MDO projects, to drive substantial growth and strengthen market leadership. All existing projects are progressing well and remain on track, except for the water division, which has experienced delays due to slower bill certification due to non-allocation of funds. For financial year 2026, the company has set a revenue target of INR 6,500 crore. Subject to the pace of traction in MDO business, EBITDA margins are expected to remain consistent with the FY 2025 levels, and the company is confident of achieving approximately 25% year-on-year revenue growth. Margins are anticipated to remain stable, with potential upside depending on the contribution mix from O&M and mining segments. The order book outlook for the current financial year remains robust, supporting the growth trajectory.
Power Mech is well positioned to demonstrate execution and conversion of approximately 40% of its opening order book annually. Additionally, the MDO business is ramping up steadily, and both O&M and MDO segments are expected to be key drivers of the growth in the coming years. With reference to our MDO business, focus is concerned. KBP Mining's mobilization of heavy equipment has been completed, and mining operations commenced on 15 April 2025. Till October 2025, the company has achieved around 6.15 cubic meters of overburden removal, and the activity is continuing as planned. Coal production is expected to commence in November 2025. The mine approach roadworks are in progress, and the company is targeting minimum coal dispatch of 1 million tons during the year, with a plan to scale up operations to 1.5 million tons. All land required for mining has been handed over to CCL.
The other second mine at Kalyaneswari Tasra project, OB removal and coal dispatch operations have been ongoing since January 2024, with approximately 8.7 lakh tons of coal produced and dispatched to the existing washeries as per the sale direction. The project received environmental clearance for the 3.5 million tons per annum washery in October 2024. We have appointed design consultants. Design consultants have been appointed for railway sidings and washery development. The major washery equipment design and vendor finalization have been completed. Equipment mobilization is in progress, and civil construction works have commenced. The washery construction is targeted for completion by September 2026. The phase one R&R colony spread over 4.5 acres has been completed and handed over to the project-affected families. Handing over of the colonies to the project-affected families is in progress. Approvals for phase two covering 41.11 acres are currently under process.
While sales current coal off-take remains below the plan due to the limited external washery capacity, the company is actively engaging with stakeholders to resolve these constraints and ramp up the production in the coming months. With this, now I request Mr. Ramaiah Garu to update on the key business development initiatives and future outlook.
Yeah. Thank you, Aravind.
Go ahead, Guru.
Actually, Aravind, for the multiple words you have brought up. No, I think, as Aravind has rightly said, this business is continuously driven on the bullish pace because of the government initiatives in the infrastructure and new projects and many of the other initiatives that have been taken. And now, private sector also is catching up. As a company, it has got an all-round spread in many segments: power, infra, and then railways, roads, and then export also.
We are well positioned to catch up these opportunities, and there can be some variation based on quarter-to-quarter basis in terms of investments and the way the scheduling of the tenders has come. And particularly, our key areas of focus will be BHEL and then L&T, which are the EPC contractors which have taken bulk of the orders from the developers, the NTPC and the generating companies. That is, a substantial flow is expected on that in terms of the ordering in the next six months because the initial order pickup was a little bit slow because of the engineering phase which was involved. And that is where we are expecting more opportunities. And other key developers are the Adani Group, which we have substantially established a presence in many projects in about 6,000 MW and working in about 2,500 worth of opportunities. Sorry, ongoing jobs.
And they also have to do substantial balance ordering of the new projects and all because Adani is totally into the new projects. What they have taken is more than 22,000 MW, and NTPC has taken nearly 12,000 MW, more than 12,000 MW. Together, they contribute substantially out of the total 47,000 MW of ordering which has been done in the last 18 months. Therefore, there is a substantial balance ordering in the main power plant sector itself, which can open up the opportunity size which can be between 30,000crore-45,000 crore in segments of ETC, then civil, structural, and other miscellaneous projects. Another key element of this capacity addition is that the annual capacity addition, which has compounded drastically, is expected to go to 8,000-10,000 MW.
And since O&M, we have got a very strong presence and we have got a substantial penetration in the market. It is expected about 1,200-1,500 lots of opportunities will be generated every year in the next five years based on these capacities added. Now, this is one part of the power sector business, which is about 47,000-48,000 MW, which has been ordered by the developers. But there is an ongoing investment which is going to come up with the new developers. That is another 40,000-45,000 MW is there. That is perhaps to be ordered in the next two years based on the development phase and all. Therefore, we expect a bullish phase in the power sector development, both for our traditional business of construction, then the civil works, structural works, and other miscellaneous works.
And then once it is commissioned, the O&M in at least seven to eight years is there. That is one of the key things. Now, the new business areas what we are focusing is particularly in the infrastructure side, railways, and then about INR 30,000 crore of ongoing opportunities we are tracking it. And that should take us reasonably well to the targeted program of achieving order booking of about INR 10,000 crore. And the other new investment which is expected is in the steel sector is opening in a big way. Particularly, SAIL is planning to invest more than INR 1 lakh crore. And IISCO Burnpur has already started issuing the pre-tender inquiries, and we are participating in that. That is mostly related to those station jobs, service jobs, and civil structural work, which is our domain strength.
That is expected about INR 8,000 crore- INR 10,000 crore in the next three to five months. That is a major area of investment for us. There are opportunities in the other sectors also. For example, NMDC, they have got a planned investment of INR 50,000 crore to enhance the capacity of the iron ore from 50 million tons- 100 million tons. We are in continuous discussion with NMDC. NMDC has also started the tendering process. Three BOT tenders are already notified: two in NMDC Kirandul, one in Donimalai. That is one of the areas of interest because iron ore is going to be a demand is going to be there, and we would like to see how we can enter that business and with the expertise what we have developed in the MDO business and BOT business.
Therefore, these are the two significant developments which can be there in the next six months, and as I already said, the ongoing tenders of nearly INR 30,000-INR 35,000 crore, that is on track, and that should take us reasonably well for meeting about INR 10,000 crore of target, and export jobs also, on the O&M side and the maintenance side, certain initiatives are being taken place. That is going to happen, and O&M side also, we had some successes in this year also, and based on the commissioning program of the balance new plants and all, we are keeping a track on that, and that should be continuously focused. This is what I would like to say. Thanks. Thanks to the team.
Thank you. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on their touch-tone telephone.
If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Vinay from HATHWAY INVESTMENT . Please proceed.
Yeah. Just wanted to understand how much is your outstanding receivables from the JJM projects?
It's a receivable is around INR 226 crore, sir.
INR 226 crore. And after that, the last one year, there is no fund allocation to this project, and the work executed to the extent of INR 220 crore of work is under certification. So total INR 446 crore is the total receivable and WIP together.
Okay. And in your total books, how much is your unbilled revenues?
INR 220 crore.
No, that's for JJM projects. But overall?
Overall is around INR 960 crore.
Okay.
And just, sorry, you were saying something?
INR 160 crore. In that, if you remove this INR 220 crore, roughly INR 700 crore is the regular operation business.
Okay. Just on one thing, your dependence on power sector, especially thermal power plants, is very substantial. In the long term, post-2030 scenario, are we looking at any kind of reduction in that from the environmental point of view? And how would the company be looking at it? It is a very long term, but still.
That is very correct. After all, ultimately, the CO2 emissions have to come down in the whole scenario. And this is a short-term measure of seven to eight years because to maintain the. I think we have discussed this matter many times over the reachability. And that is why the government's plan is to add 80,000-100,000 MW.
But ultimately, what happens, these power plants also have to run another 25-30 years minimum. And then somewhere in 47-50, perhaps they will looking at a downward trend in the emissions and the decommissioning of the power plants. But what will be there, there will be up and down the business in the ETC segment and civil and structural in the next five-seven years. But afterwards, O&M also will be there. As a product of O&M business will substantially go up, as I said, INR 1,200 crore-INR 1,500 crore is the opportunity, and we have got a huge penetration in the market and ownership there. And that should continue to rise in a big wave. Therefore, to some extent, that will definitely be made up.
But what is going to be the other scenario is that the non-power sector, steel sector, infrastructure side, and then petroleum and this one, oil and gas sector also, new plants are expected. And there we can possibly look for diversification and with the experience what we have gained it. Like Andhra Pradesh, they are planning to put a 60,000 crore capacity plant. And then Madhya Pradesh is coming up. Then steel plants are planned too. SAIL has told you about 1 lakh crore of investment. ArcelorMittal is coming up. JSW is coming with a huge investment in Maharashtra. Therefore, in all these areas, already company has got some sort of a penetration and expertise and experience. And that will be enhanced into where these gaps will certainly happen. And therefore, we are confident we will maintain our growth.
Thank you, sir. Thanks a lot.
Thank you.
The next question is from the line of Mohit Kumar from ICICI Securities. Please proceed.
Hi. Good afternoon, sir. My first question is on the large BOP opportunity, especially from the likes of NTPC. So there was the Gadarwara, there was, I think, one more Nabinagar. Then the third one which will come up, I think, for the bidding is the Telangana. I don't think we have participated in those large BOP opportunities, be it Gadarwara, be it Nabinagar. I just want to understand, is it that we don't have pre-qualification for the large opportunities, or do you think, or is it not wise for us to bid for the large projects? What is holding us back that we're not even participating in those large tenders?
Yeah. Mohit, sir, this is Rohit. Thanks for the question.
I think it's very relevant, especially considering the fact that we recently won a BOP order with BHEL for Singareni Thermal Power Plant in Telangana. So by the time these tenders have been conceived, NTPC took a slightly different pre-qualification route in which we were only qualifying as a consortium partner along with other players who would bring in some kind of expertise. And then later on, one more evolution has happened, and then this pre-qualification criteria had come up. And through this, we are qualifying and going forward, and NTPC has also chosen a bulk tender route, right? So I think our focus is mostly on unit capacities where there is one unit of 800 MW being set up or two units of 660 MW that are being set up. And we should, going forward, you'll see us participate in a lot of these tenders.
Yeah, that's the update on this. Understood. Understood. So Nabinagar is pending. Nabinagar should come up in next one year, so we should be able to participate, right? Correct? Is that fair understanding? Because Gadarwara and Nabinagar is done, I think. We are not one of the participants. And they also have a large opportunity from most of the states, right? Most of the states, BHEL have won the BHEL, won the tender. So how is the BHEL pipeline looking right? We have seen a lot of tenders from BHEL side. Are we only looking for particular kind of packages, or are we also, do we have the capability to do this CHP, AHP also? Yeah.
See, we have developed expertise not only in the traditional ETC business, O&M business, the power sector.
We also developed the expertise to handle one of the key packages in the balance of plant and the supporting packages on the coal handling also. That is, we have done about four or five contracts. And we have gained that experience. That should help us, but basically, BHEL's outlook will be is that they will continue to drive the orders because L&T is there. Unless the government takes a policy decision to import the equipment from outside, I don't think that will happen, and BHEL had this wherewithal capacity to do 16,000-18,000, 16,000 MW per year a couple of years back, and of course, we have seen the downward trend and all those things happen. Now it has picked up, and looking at the long-term investment, at least seven-to-eight years, BHEL should be ramping up their capacity.
They should be reasonably able to bid for all these things. They will continue to be a key player because, as I said, the 47,000 MW what has been ordered by the developers. Still some substantial ordering has to be done by the various vendors like Adani and even NTPC for the new tenders, what they are going to call. Also all the various utility companies, utility companies have got a share of more than 12,000 MW. And that also has to come up. Of course, to some extent, they have started ordering. Then balance ordering of the, as I said, the 46,000 MW new developments which are going to happen.
Therefore, these 46,000 MW will be a substantial chunk of the order which will come up in the next at least two to three years, which will be reasonably shared substantially by BHEL and to some extent by L&T also, and we should be having a long-term plan for at least executing eight to 10,000 MW in the next 10 years,
and then Mohit, sir, just adding what you, sir, had said, so the recent BOP package that we won entails us to construct a coal handling plant, ash handling plant, which is an expertise that we have developed over years as a construction company, now we are just adding engineering as an expertise. We have partnered with Tata Consulting Engineers, TCE, and also procurement is anyway a commercial activity, and hence our entry into this space.
And also going forward, as I had said earlier, we want to participate in the state utility projects that are either planning on separating the BTG and BOP or are awarding the entire plant to an EPC player like BHEL. And then we don't mind subcontracting under BHEL or L&T to take up the BOP EPC works and BTG erection works.
Understood, sir. Thank you, and all the best. Thank you.
Thank you.
Thank you. The next question is from the line of Mahesh Patel from ICICI Securities. Please proceed.
Yeah. Hi, sir. Thanks for the opportunity. So my first question is on the steel opportunity that you mentioned, right?
Just if you can explain what exactly are we doing there and how much is our opportunity in terms of if we consider cost of steel plant, say, CapEx for one MTP, how much will be our opportunity if you can quantify?
Because the long-term investment profile of the government is to invest about INR 10 lakh crore in the next five-seven years. Because the present steel capacity is 200 million tons, wherein the last year's production was 102 million tons. That has to go up to 300 million tons of capacity addition by 2030-2032. And as we have seen, 4-5 million steel plants needs about INR 35-45 thousand crore of investments. And all the players, for example, SAIL has got a clear plan they established. First, I think it is IISCO 14.
They will have a plan for the Bokaro and then Bokaro expansions also. ArcelorMittal is coming with the greenfield plant in Andhra Pradesh, and some expansions will be there. JSW Mittal and JSW, and then JSPL, both are planning capacity additions. There are some new players also coming up. For example, Rashmi Group is coming with an investment of about INR 10,000 crore. There is a group available in this one, Balarim-based mining groups also. They are also planning investment of about INR 15,000 crore-INR 20,000 crore. Therefore, the total investment of more than INR 3 lakh crore will happen because of the continued growth of the upward series into the growth of the economy. As the economy grows, the steel requirement also demand has to be there.
In fact, many of the steel suppliers are also complaining that, "Why are we importing also material from outside?" Therefore, we have already had an experience of doing steel plant construction in JSW Dolvi and then JSW Vijayanagar, and ongoing, we are doing some jobs in JSPL, and our construction experience and O&M experience and our project management experience, what we have developed over the years in the power sector will be rightly used for the steel sector, and also in the mining sector, for example, L&DC jobs and the mine site facilities which they are going to create. Therefore, this is where we are quite bullish on these two areas.
Okay, and sir, on the MDO side, what is the production that we are expecting in FY 2026 and 2027?
First mine, which we took CCL, Central Coalfields Limited.
We anticipate to do one to 1.2 million before March 2026, which is going to translate to INR 140 crore-INR 150 crore in top line. The other mine which we took with SAIL, the 4 million metric tons per annum one, we anticipate to do 360-400,000 tons before March 2026. We are already on track. We have done half of that already. This is going to translate to INR 57 crore-INR 65 crore in terms of total.
Okay, sir. Thank you so much.
FY 2027 ramp-up in both the mines. There is going to be significant ramp-up in FY 2027. FY 2027, KTMPL mine, the four million metric tons per annum with SAIL, we anticipate to reach peak rated capacity.
The first mine in which we are going to do one million will get ramped up to 2.5-3 million by FY 2027, translating to a combined top line of INR 550 crore-INR 600 crore.
Thank you. The next question is from the line of Pratish from Lucky Investment Managers. Please proceed.
Sir, just an observation, and I don't know how the company is looking at this. If you look at the last half, basically the first half now, and also the second half last year, if you see the financial deleverage is kicking in with the rising debt because of some of the receivables which have been stuck, working capital being expanded, and investment which is done in the coal assets, which is not yielding the desired revenue.
If you see your even coal business, the coal plants have been postponed by an excess of one, one and a half years easily. So how are we reviewing this situation? You may have your 15%-20% top line growth, but nothing's going down to the bottom line. So how should we be viewing as a management this situation? What you said? What are the guardrails? What are the steps taken?
The major increase in the working capital utilization is because of the Jal Jeevan Mission water receivables spending. If you look at the March, I have a receivable of around INR 287 crore, and as of September, it is 200.
So we know the figures. We know these figures. What should we be done? We know the figures. We know the opportunity incremental in the inflow.
We are pursuing with the government, sir.
Recently, we have met the Chief Minister of the UP government, who called for all the clients, and they assured us that they will certify these bills in a couple of months. They are delaying the release of the funds from the state funds. So we are hoping by March we'll bring all this into the control and we'll reduce our working capital utilization with that receivable, sir.
We were not active in water. We ended up paying some of these projects at the staggering. So any review process that you implemented incrementally?
So the balance sheet, as of now, we have not raised any new loans, and we have raised a QIP of INR 240 crore. That INR 200 crore fund still is with us, so we are utilizing that for the current year. And the next year only we'll raise the borrowing, sir.
By the time we will also recover our existing receivables and certifications will complete, and we'll bring this to the normal.
Okay. And from the execution point of view, what kind of revenue execution that you will see excluding mining this year in FY 2026?
Around excluding mining, around INR 256 crore, around INR 6,000 crore-INR 6,200 crore we can achieve from the regular business, sir. INR 250 crore we projected from the mining business.
And how much was mining business last year?
Last year, it was around INR 84 crore, sir.
Around INR 84 crore.
So basically INR 5,160 crore in EPC and grows to basically INR 6,200 crore. Yes.
Okay. Thank you, sir.
Thank you. The next question is from the line of Hitalisha from Shriram Mutual Fund. Please proceed.
Hello. Yeah. Thank you for the opportunity.
I wanted to ask you, what is the split of the order book and the order inflow of the various segments, like civil and mechanical, O&M, all of that? Hello?
One minute. I'll ask. The total INR 14,226 crore as of 30th September consists of INR 1,700 crore roughly from the mechanical business, power erection business. INR 9,000 crore is from both power, civil, and infra civil. O&M of around INR 2,700 crore. Electrical business of around INR 800 crore. So we have a domestic of around INR 14,000 crore and international order of around INR 220 crore. So from power side, mix is INR 8,300 crore is from power side, and infra side is around INR 5,900 crore.
Okay, sir. And for the order inflow?
For the order inflow, this year we are projecting INR 10,000 crore. We are projecting erection business. From erection business, around INR 2,000 crore. From the civil business, INR 2,400 crore. O&M around INR 2,600 crore.
Electrical business of around INR 300 crore. Apart from, as a new initiative, we are starting the solar and other green energy projects we are targeting. We received around INR 159 crore orders during the year. BOP EPC of around INR 2,550 crore. Around INR 10,000 crore, this is a mix of various segments.
These orders are expected, right?
In the sum of orders, we achieved INR 4,900 crore of orders we already received and the balance we are expecting to be for March.
Can you give the split of the INR 4,900 crore in these segments?
In that, we received mechanical business of around INR 49 crore, civil business of INR 1,500 crore, and O&M business of INR 761 crore up to September. During the till date, we have received around INR 2,570 crore orders from the BOP EPC. For the mechanical new SBU addition of EPC, around INR 2,550 we added.
Okay. Thank you so much.
What will be the execution timeline of these major projects that you just listed out?
Generally, it will be two, two and a half years. It's typical. Two to three years is the general typical. For the EPC, it is 38 months. So it's roughly three and a half years for the BOP EPC.
Okay. Thank you, sir.
Thank you. The next question is from the line of Parani from Avendus Spark. Please proceed.
Good morning, sir. Am I audible?
Yes, sir.
So I have a conceptual question on the power sector. One, if a project cost is around INR 10 crore per MW in the thermal side, what is the scope for Power Mech to, say, get opportunity orders from this particular INR 10 crore per MW?
You are correct. INR 10 crore per MW can be including the IDC cost.
But the EPC cost can be INR 8.5 crore depending on the scope of responsibility. If it's a single unit, it can be more than two units, sub-units can be slightly less. And now it is standing at greatest order BHEL has got is INR 8.3 crore for 800 MW, 1 to 6.0 per MW. Now, as for the opportunity in this for the Power Mech is concerned, there are two sectors of the business. The main plant side, main plant side, the total investment can be around 55% of this INR 8.5 crore. And normally, the service portion of it, we can say it will be around something like INR 1,000 crore will be coming in the main plant for each unit, for each plant of two units. That is, suppose 1,600 MW is there, about INR 1,000 crore can be the opportunity there. That is the main plant.
And the balance of plant is all entailing opportunities available, whether we want to bid on the service side of the business or on the balance of plant of the business, subject to the qualification. And the balance of plant will be anywhere between INR 3.5 crore-INR 4 crore. And that is also in some segments, if it is called individually, we can bid also for the coal handling and material handling, and then civil structures, then for the other miscellaneous civil works like IDCT, cooling towers, and various other jobs, structural jobs, etc. Therefore, we can say, including the civil works, structural works, then service portion of the installation wise, we can safely take as 25%-30% is the opportunity available out of this side.
Pardon? So 30% of INR 8.5 crore?
Overall. That is the maximum.
Okay. So 30% of INR 8.5 crore.
This will be during the project construction, and O&M comes in the operational period, right?
O&M opportunity that will come between INR 11 lakhs-INR 15 lakhs per MW per year. And then one more thing is that the BOP is there as a complete package, as I already told you. That gives a complete opportunity on 40%-45% of INR 8.2 crore as an opportunity for the BO.
Right. Coming to the next question, you mentioned about 46,000 MW yet to be awarded in the coming year, plus about 12,000 MW from state utilities. I can roughly take 40% of this overall opportunity to be our long-term opportunity, right, during construction?
The total ordering which has been done in the last one and a half years, which is under execution at various stages, roughly comes to about 47,500 MW.
So what I said was, this is, you can say, mostly ordered in the EPC mode on the main plant side. And in the case of Adani, they have taken a different route. They are ordering the main plant on the equipment supplier, whereas the balance of plant and the service job, they are awarding themselves. Therefore, that also as an opportunity is available for a contract like it. Apart from that.
So, sir, overall, to answer your question, in this capacity, 55% will be our opportunity.
Understood. So basically 46 plus 12, that is around 15 MW. 15 MW if I
8.5-9 into 60%.
Okay. 8.5 into 60%. Okay. Got it. So that comes to around, yeah, that comes to around INR 3 lakh crore. Okay. Fine. Yeah. Got it. Fine.
So my second question is the ability to actually foresee this 46,000 MW and 12,000 MW upcoming thermal. Is there a surety that this will happen in the light of, say, storage capacities ramping up or becoming more prevalent? And do you foresee any delays or this not actually happening in the next three to five years?
Planning by the CE and the Power Ministry. And even the customers also have been identified, like Adani, NTPC is having plans in expansion Patratu, Meja , then Obra, Nabinagar, Tata Power has got plans, Vedanta has got plans. Then, for example, SJV and Buxar has got a plan to add one more unit. KL, Coal India wants to enter the power sector also. Then JSW and JSPL both are planning it. NLC is also planning.
For all these people, either in the brownfield or a greenfield, they are going to put up these projects. That is the capacity has been arrived at it. It's a question of, in terms of timing and execution, it is normally a development process in terms of environmental clearance, land acquisition, investment, achieving the financial closure. This, we all have seen, there are certain, always certain things can be there in that which can take the project forward or some slowness is there. But these capacities are a must to balance the grid capacity for another seven, eight years it should be established.
That was positively expected to come up.
Okay, sir.
My final question, since we identified the opportunity as INR 3 lakh crore for this 58 GW in, say, medium- to long-term, what would be roughly our market share or expectation to win over this 5- to 7-year period on this INR 3 lakh crore of opportunity?
No, you can take, as I said, on the upper side, if you take about 30% on the service side, on the civil structural services side of installation. And if it's a balance of plant, we can take about 35%-40%, 45% easy.
You're talking about the market share, right?
Everything we get qualified there.
Yeah. That's the total available market again. But out of this INR 2 lakh crore, close to INR 3 lakh crore, we anticipate to bid for at least INR 2 lakh crore worth of these projects, sir.
And in power sector, our traditional hit ratio has been 50%-60%.
Okay. Okay. Got it. So essentially INR 1 lakh crore. INR 2 lakh crore will bid INR 1 lakh crore potentially inflow.
Idealistic scenario, a little conservative number is what I gave you.
Understood. Great. Thank you so much. Thank you so much and all the best.
Thank you. Thank you. The next question is from the line of Deepak Poddar from Sapphire Capital. Please proceed.
Yeah. I'm audible, sir?
Yes, Deepak.
Yeah. Thank you very much for the opportunity. So just wanted to understand, first up, on the MDO side, you mentioned, I think, this year around INR 225 crore-INR 250 crore and next year INR 550 crore-INR 600 crore of execution that we might do on the MDO side, combining both the mine.
So what sort of margin profile we are looking at both this year and next year at MDO level?
This is now just started the production because Tasra has not yet we are using only the small capacity of production we are doing monthly around 50-60 thousand tons. KBP just started this year and slowly will ramp up the production. So on an average, we may get around 15%-16% EBITDA blended together.
And Deepak also, most of our margins in both the mines, they'll kick in when we achieve PRC. For the Tasra mine, we expect to achieve PRC in FY 2027, March FY 2027. That's when the washery will also be commissioned, commercial operation of the washery shall be declared, and we'll get our full mining fee. And the EBITDAs are expected to touch 26%-28% around that time.
The first mine, the CCL mine, 5 million metric tons per annum, we are expected to achieve 5 million metric tons per annum in FY 2028. There's going to be a gradual ramping up. Right now, we are doing around 14-16, and it's going to ramp up all the way to 20-22 in this mine when we achieve the peak rated capacity.
Understood. So at below peak capacity, I mean, this year, we are still expecting 15%-16% margin at INR 250 crore kind of a scale, right, at MDO?
Yes. 14%-16% margin at a INR 250 crore turnover scale.
Understood. And then next year, I think at the SAIL mine, you are still expecting peak achieving PRC next year, FY 2027 itself. So there, FY 2027 at INR 550 crore-INR 600 crore, a 19%-20% EBITDA margin is achievable?
PRC March 27, which means there's going to be a ramp up from the current 60,000 per month, which is translating into 360,000 per annum. There's going to be a ramp up of 360,000- 4 million metric tons over the last five months of the financial year, right? And the washery is also going to get commissioned. We want to commission it by July next year, and we want to declare COD by September. And we want to be ready around the time when the washery gets commissioned. We want to produce to two to we want to enhance the capacity. By the time the washery gets commissioned, we want to be ready for 2 million metric tons per annum. And when it gets commissioned, we want to ramp up to 4 million metric tons by end of March in five months. That's the plan.
Okay.
Peak revenue, I mean, combining both the mines can be around INR 1,800 crore-INR 2,000 crore per annum. Would that be a right assumption? Plus INR 2,000 crore because of escalation and all of that.
So at INR 2,000 crore, what, EBITDA margin of 25% is what that we might be investing at peak?
Yes, sir. 23% to 24%. To be 23%-25% also.
And this peak MDO INR 2,000 crore will achieving by which year? FY 2029, FY 2028?
FY 2028. Both the MDOs, PRC, peak rated capacity will achieve by FY 2028, but same mine, we are going to achieve PRC by FY 2027. And it's going to continue through 28 also. But 5 million metric tons per annum CCL mine will touch PRC in FY 2028 towards the end of FY 2028.
Great. And so understood. I mean, basically, you are expecting a big ramp up in your mining revenue from FY 2028, from FY 2027 to FY 2028, right?
Yes. Yes. Exactly.
Okay. Understood. And secondly, I mean, you spoke about your business mix. I mean, currently, 75% is the power sector, right? So you are coming up looking at new opportunities in the steel sector. So how do you see even railways you spoke about, right? So how do we see your business mix changing, which is 75% power? And all these new sectors, how is the margin profile?
So the margin profile, sir, currently on an average, as of now, in the construction, we are getting up to 10% is the EBITDA margin we are generating. And O&M and MDO, once we reach the peak rated capacity, are the main driving force for increasing our EBITDA margin. O&M is giving on average up around 15%-16% of margins.
The business mix is concerned right now. The power is the next two to three years. Power orders will come more. And parallelly, we are also looking at the steel opportunities also. So more or less, the margin will be 5% here and there. We are maintaining at the same level of percentages.
Okay. So the 75% will continue?
Yeah.
Yeah. Yeah. The 75% will continue with power, thermal capacity addition, and O&M capacity addition also being a major driver for the EBITDA too. There is going to be slight EBITDA improvement because there is O&M mix getting added as we see new capacity that is being commissioned every year. And international O&M is also doing good. We are achieving good profitability levels there. So international O&M is growing at 25%-30% year on year, CAGR. So that is also a good sign.
So we see this add to the EBITDA margin slightly.
Sure. Sure. Understood. And just one last small thing from my side. So you spoke about the guidance for this year. So anything you want to talk about for FY 2027 as well, given the scale-up and the high margin revenue mix will increase for FY 2027?
So this year, we projected around 25%. Year on year, we are projecting 25% growth, but being the volume is increasing and we are adding the more MDO business during the next year. So we are in the line of 20%-25% between only we are projecting, sir. Maybe in the range of around INR 7,500 crore-INR 8,000 crore.
And what margin profile?
It will jump, sir. Maybe around 0.25%-0.5%. It depends on the mix of MDO and the O&M business.
So how much jump you mentioned?
Your voice was not audible.
0.25%-0.5%. At any time. Fair enough.
At the EBITDA level. Fair enough. That's very helpful, sir. All the very best to you. Thank you so much.
Thank you, sir.
Hello? Madam Shashi. Hello? One hour, I think.
Hello. Madam Shashi, your line has been unmuted.
Yeah. Hello.
Yeah. Please carry on, ma'am.
Yeah. So we have seen headwinds in the electrical segment for a few quarters now. So I would like to understand what is the headwinds there.
We received railway signaling and telecommunication and overhead electrification works in the state of Chhattisgarh. Two packages, two projects we received during last year. So these execution and supply of material we supplied during the year and we are executing these projects that resulted in the increase in the revenue compared to the previous year.
Okay.
So are these expected to continue, or is there any improvement expected in this segment?
Yeah. Transmission distribution, we are slowly closing the shop. There's not fitting into all the annual. We are slowly closing the existing projects, and we are taking up the new jobs in railway works, and this team will execute going forward all these techno-cum-civil-cum-techno works they will take up under the division, and they will execute. We are targeting in some projects.
So those segments will replace this one.
Yeah.
And I would like to understand the opportunity in the renewable energy segment like nuclear battery energy storage, pump storage, and all of that. If you can share that.
Ma'am, while we continue to focus on renewable energy projects actively, but there has also been a lot of irrational bidding.
Our primary focus was on solar and battery energy storage systems on a BOOT basis. But we see a lot of erratic bidding trends currently. So we have slowed down in bidding for projects there. But you'll see us in a few bids and we continue to focus on solar plus battery energy storage systems. Now, it's a small pivot to what we were doing earlier from a standalone basis. Now, we want to combine these expertises and bid for a few projects. Again, with healthy discounts and healthy utilities.
Can you share a number of any opportunity in the solar and battery energy potential opportunity?
See, FY 2026, we already won a Kusum Yojana project of 13.5 MW of AC capacity. Next year, we plan to enhance this to 100 MW of solar and around 200-250 MW of MWh of battery energy storage system capacity.
So those are the numbers we are looking at. This is FY 2027's projection.
Okay. Thank you, sir. That was really helpful. And sir, are you predicting any cost escalations in your current projects that you are handling that can affect the margin?
The majority of the contracts we have that are established on the price escalation is passed through. So we are not losing any money. There is no cost escalation because of the escalation. We are getting the escalation amount from the clients.
Okay. Thank you, sir.
Thank you. The next question is from the line of Preet from Wealth Advisor. Please proceed.
Yeah. Hi. I'm sorry I joined a little bit late, so I may have missed out. But did you give any guidance for the full year of achieving the INR 6,500 crore turnover? Is that still on track or are we changing your guidance?
This again, the INR 6,500 crore is linked to the MDO projections also. Maybe 1% or 2% slippage may be there because of getting the new orders, which we anticipated during the year. Most likely, we may touch around INR 6,200 crore-INR 6,300 crore level of the business during the year.
Sure. Sure. Sure. Sir,
it still represents an 18% growth.
Yeah. Yeah. Absolutely, sir. I think a 20%-25% growth still is good enough. The other question I had was again on the margin side. Do we see a 0.25%, 0.5% bump for FY 2026 over FY 2025? Is that a possibility?
More or less, we'll have the same level as last year, sir. It depends on the mix of any new orders of Goindam and increase in MDO may probably jump the number.
But at this moment, we are estimating that this is stable at the last year level.
Understood. And do we have any plans for raising funds?
At this moment, no, sir. If any new opportunities comes up or any investment opportunities, then probably we'll approach the market.
What would be our net debt level at present?
Around INR 360 crore, sir. Net debt is around INR 300 crore.
Got it. Got it. And on a similar line, we should expect an 18%-20% jump in top line for FY 2027 with margin increase of at least 0.5% given MD orders as well.
Yeah. We are projecting in the same line of 20%-25% between. We are projecting for the next year also. Yeah. And with a margin increase of not 0.5%, sir. It's 0.25%-0.5%.
Okay. Okay. Noted. Noted. Perfect. Thank you, sir. Thank you.
Thank you.
The next question is from the line of Vinay from Hathway Investments. Please proceed.
Yeah. Just one clarification. I wanted in your previous answer, you said that the potential for you in electrical, the power sector is around 1 lakh crore. This would be over what, three to five years? What time frame are we looking at in this INR 1 lakh crore?
No. It is like this. The opportunity what has been mentioned is based on the balance ordering to be done on the main EPC orders already ordered, which is there some of the items like main plant services work, balance of plant work, then structural work, civil work. That is substantially, it is there to be ordered by BHEL to be ordered, Adani has to order, then NTPC also has to order.
The other thing what we said was the new investments and developments will come at 46,000 MW new plants. That has to take shape. That will continuously be there next couple of years. And where the EPC orders have been placed by NTPC, Adani, and utility companies in the last six months or one year, there the ordering has to be done more because they had to ramp up the ordering. And that is where we said that initially, we can have immediately about INR 40 thousand crore-INR 50 thousand crore. And the balance INR 40thousand crore- INR 50 thousand crore will develop in the next couple of years.
So even if I take INR 1 lakh crore over a period of six-seven years, we are looking at around INR 14,000 crore per year, roughly. I mean, not in the same linear method, but is that the number? Or am I getting it wrong?
It should be reasonably okay.
And that is only in the 75% of your business.
Potential also which will add up every year INR 1,500 crore.
And we are currently doing around INR 6,500 crore a year. So is that the jump that you're looking at?
Yeah.
Okay. Thank you. Thank you very much.
Thank you. The next question is from the line of Amay Sharda from Purnartha Investment Advisors. Please proceed.
Hi. Thank you for the opportunity. I just had one question. Why was there this huge increase in the mechanical segment revenue to INR 435 crore? And do we expect it to sustain for the rest of the year as well?
Yeah. See, during the year, see, there is a slowdown happened in the FGD orders that concern. And suddenly, there is a government direction. They have given a direction.
The Udupi project, which was in slow progress, and now Adani has given an instruction to complete this project by March. Because of that, they started doing this execution since last Q2 onwards. That resulted in more execution in the power sector.
What is the size of the Udupi project?
Around INR 936 crore.
We are expected to complete in this financial year?
This financial year. Yeah. Yeah.
Okay. We expect this momentum to continue for the rest of the year.
Yeah. Yeah. By before March will complete. We can expect this level of order execution till March.
Okay. Okay. Thank you so much. Thank you.
Thank you. Due to time constraints, that was the last question. I now hand the conference over to the management for the closing comments. Over to you, sir.
Thanks, madam.
Thanks for the investor community and our colleagues here. I think as projected by Aravind and also Rohit, and as we discussed with the very interesting questions and all, it is reasonably assured to say that we will be on track in achieving the targets on the ordering about INR 10,000 crore because we are almost near to that 50% by the end of this beginning of the third quarter, and with a lot more opportunities are coming up and new segments of the business we are looking at it. And the revenue side, we have seen the third and fourth quarters are always will be upstream will be there. That is where the INR 6,200 crore would be reasonably possible.
And with these type of opportunities and the investments coming up, I think, particularly in the power sector, steel sector, infrastructure side, railways, and other segments, perhaps we will continue to. We'll continue to focus for the growth in the coming couple of years. And another area perhaps we can look at as an interesting diversification is data centers. Of course, data centers development and the software part of it is different. But the hardware part of it is an interesting point because these data centers need a lot of power capacity, substations, which is our specialization. Then it needs a lot of infrastructure works and development, civil works, and then other facilities, balancing facilities. So that is a segment which we can gainfully use it based on the expertise what we are gaining. And there are other sectors also which I said differently can come up.
And apart from the steel plants, all those areas will be available.
Thank you. Thank you. On behalf of Nirmal Bang Equities Private Limited, that concludes this conference. Thank you for joining us. And you may now disconnect your line.
Thank you.
T hank you.
Thank you.