Ladies and gentlemen, good day and welcome to the Q4 and FY25 Earnings Conference Call of Power Mech Projects Limited, hosted by Nirmal Bang Equities 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 touch-tone phone. Please note that this conference is being recorded. This conference call may contain forward-looking statements about the company, which are based on the beliefs, opinions, and expectations of the company on the date of this call. These statements are not a guarantee of future performance and involve risks and uncertainties that are difficult to predict. I now hand the conference over to Mr. Deepak Shah from Nirmal Bang Institutional Equities.
Thank you, and over to you, sir.
Hi everyone, good morning. On behalf of Nirmal Bang Institutional Equities, I would like to welcome you all to the 4th Q2 FY25 earnings call of Power Mech Projects Limited. The management today is represented by Mr. Nani Aravind, CFO of the company, and Mr. S. K. Ramaiah, Director of Business Development. I will now hand over to the management for their opening remarks, after which we will open up the floor for Q&A. Thank you and hand over.
Thank you, Pooja and Deepak. Good morning everyone. I'm Nani Aravind, CFO of the company. I have with me Mr. S. K. Ramaiah, Director of Business Development. Unfortunately, Mr. Rohit Sajja, President of Business Development, is unable to join us today due to unexpected travel and meeting commitments. I take this opportunity to welcome you all to our Q4 FY25 earnings call. The performance for the 4th quarter and full financial year FY25 continued in line with our set targets. For Q4 FY25, we reported a total income of INR 1,870 crore, marking a 43% increase over INR 1,312 crore in Q4 FY24. EBITDA stood at INR 233 crore, up by 46% from INR 160 crore last year, and PAT came in at INR 117 crore, reaching a 39% growth compared to INR 84 crore in Q4 FY24.
The EBITDA margin improved slightly from 12.2% to 12.5%, owing to better cost control, while PAT margin marginally decreased from 6.4% to 6.3% due to increased finance costs and higher minority interest costs. For revenue mix for Q4, in terms of revenue mix for Q4 FY25, the mechanical business contributed 290 crore, a 65% increase over INR 176 crore in Q4 FY24. The civil segment, including railway, water distribution projects, contributed INR 980 crore compared to INR 725 crore in the same period last year, reflecting a 36% increase. WIP revenues rose to 533 crore, up by 51% from INR 354 crore. The electrical business saw a significant increase, reaching INR 25 crore versus INR 6 crore during last year, marking a 315% jump. The mining business contributed INR 25 crore, lower than INR 41 crore in Q4 FY24, showing a 40% decrease. Other incomes stood at INR 17 crore compared to INR 10 crore in the previous year.
The revenue split for the quarter was 97% domestic and 3% international, while the contribution from power sector remained at 53% for the quarter and with non-power sector accounting for the remaining 47%. For the full year of FY25, we reported a total income of INR 5,279 crore, a 25% increase over INR 4,234 crore in FY24. EBITDA for the year stood at INR 649 crore, growing 24% from INR 524 crore, and PAT was INR 327 crore, an increase of 32% over INR 240 crore in the previous year. On a full year basis, EBITDA margin declined slightly from 12.4% to 12.3% due to increased warrant costs, whereas PAT margins improved from 5.9% to 6.2%, driven by lower tax expenses and higher other income, so the revenue mix for the 12-month period, mechanical business contributed INR 898 crore, showing a 30% growth over INR 692 crore in FY24.
The civil segment, including railway and waterworks, contributed INR 2,439 crore, up by 6% from INR 2,308 crore. Non-power revenues rose significantly to INR 1,746 crore from INR 1,109 crore, recording 36% growth. Electrical business revenues stood at INR 67 crore, up by 26% from INR 53 crore. Mining revenues were INR 84 crore, a sharp increase from INR 44 crore in FY24. Other income rose to INR 45 crore from INR 25 crore. So the overall business split for FY25 was 95% domestic, 5% international, with 59% of revenue coming from the power sector and 41% from the non-power sector. The financial parameters of the company are concerned with better deployment of capital and improved operating margins. We have also witnessed an enhancement in our return on equity, which increased from 14.22% in FY24 to 16.26% in FY25.
However, return on capital employed saw a marginal decline from 24.16% to 23.28%, primarily due to delays in receivables realization in the water division, which necessitated higher utilization of working capital borrowings. We expect this to be a temporary impact, and with the anticipated normalization, correction, and execution, return on capital employed is likely to improve significantly in the coming quarters. Other key developments during the period include the operating cash flow, which remained neutral, primarily due to the pending realization of receivables in the water division. We are actively engaging with the clients to expedite the certification and clearance processes and are confident of realizing the outstanding dues in the coming months, which will help restore the positive operating cash flow.
Net current assets days, excluding cash and cash equivalents, have increased from 121 days in FY24 to 128 days in FY25 due to delays in certification of the waterworks and delays in realization of receivables, resulting in the increase in the current assets of the company. And on stabilization of the MDO business from 2027 onwards, we can expect a significant improvement in the net working capital days. The gross debt and net debt remained controlled despite delays in certification of water bills and delays in realization of receivables. As of 31st March 2025, the gross debt is INR 641 crore, and the net debt stands at INR 48 crore. The debt-to-equity ratio, as of 31st March 2025, stands at 0.33 times. Regarding with reference to the order book is concerned, during FY25, the company has secured orders worth of INR 6,437 crore.
The order backlog, as of 31st March, stands at around INR 58,258 crore after excluding FGD orders of INR 4,264 crore. The backlog is around INR 53,994 crore. Further excluding the two MDO projects, the executable order book is INR 14,387 crore. We continue to actively pursue tenders and are targeting to secure INR 10,000 crore of new orders by March 26. During FY26, we anticipate a significant increase in ordering flow, particularly from the power sector across segments such as oil and mechanical, civil construction, and BOP EPC. As of end, we have already secured orders worth INR 972 crore during Q1. Our strategic focus will remain on high potential areas, including industrial plant operations and maintenance, railway and water infrastructure, as well as MDO projects. All our existing projects are progressing well and are on track as per the planned schedule.
For FY26, we have set a revenue target of INR 6,500 crore, which is subject to the pace of traction in MDO business. EBITDA margins are expected to remain consistent with FY25 levels. We are confident of receiving 25% year-on-year revenue growth. Margins are expected to remain stable, with a potential upside depending on the contribution from the mining segment. The order book outlook for the current financial year also appears comfortable, supporting our growth trajectory. Power Mech is well positioned to demonstrate execution and conversion in the range of 40% of its opening order book annually. Additionally, the MDO business is ramping up steadily, and we expect both oil and MDO segments to drive significant growth in the coming years. So with reference to our MDO business is concerned, our MDO business is progressing steadily.
At the KBP Mining Kotre Basantpur project, we achieved a key milestone with the release of 564.16 hectares of notified forest land by the State Forest Department in July 2024. Tree cutting for the first year was completed by March 2025. Equipment mobilization has been completed, and mining operations begin on 15th April 2025. As of now, approximately 1.7 lakh cubic meters of overburden removal has been completed, and coal production is expected to commence from Q2 FY26. At the Kalyaneswari Tasra project, OB removal and coal dispatch operations have been ongoing since January 2024, with approximately 6.4 lakh tonnes of coal dispatched to SAIL as of 30th April 2025. The project received environmental clearance for 3.5 million tonnes of washery in October 2024. Design consultants have been appointed for railway siding and washery development. Engineering and vendor finalization activities are in progress. Site mobilization is underway.
The phase I R&R colony construction on 4.5 acres is completed, and handover to project affected families is in progress. Approvals for phase two colony construction over 41.11 acres are currently under review. So while SAIL's current coal offtake is below the plan due to limited external washery capacity available outside, we are actively working to resolve these constraints and ramp up the mining production. So with this, I now request Mr. S.K. Ramaiah to update us on the key business development initiatives and future outlook of the company.
Thanks, Aravind. Sorry, introduction and continuing with all the financial good words. And thanks to the investor community. I think Aravind has given a key feature to the company's operations and the finance, and then the offering order backlog, and then the revenue on top. Some of the key aspects I would like to dwell upon is that in the Q4 particularly, there were some key important orders we have secured. Adani Power, Mundra, about INR 424 crores for the civil and structural portion of 288 MW units. Then the Koderma, another 288 MW project coming up by DVC. BHEL is the EPC contractor, INR 579 crores for the civil and structural work. Then there was a major group between NHAI for the Deoghar Bypass, 118 km of HAM project, INR 972 crores. Then there was a scope expansion of the government medical college scope which we are doing in Uttarakhand.
That is about INR 231 crores. Then other major jobs we have secured in this current year are NPCIL. First time, we have taken the 2,700 MW 5 and 6 unit stage, INR 563 crores. Then South Central Railway, INR 7,000 crores. Then Nigeria, Dangote, first time we have taken a major O&M job, a two-year long-term O&M contract for the plant which we have commissioned, capped at INR 419 crores. Then Coastal Energen, 22% O&M 1,200 MW, INR 114 crores. Then GMDC Akrimota , O&M 2 into 125, INR 227 crores. Then Vedanta Talwandi, 3 into 660 MW, a five-year O&M. This is one of the major contracts we have secured in O&M, INR 951 crores.
Now, as far as the business outlook is concerned, there have been key breakthroughs in the major orders which were secured in the oil and gas, and then particularly Vedanta, Adani. The new investments are making for the huge power sector investments. Nuclear Power Corporation, which is coming with new projects. Then the significant improvement in the export orders, particularly in the oil and gas side and the maintenance side of the jobs which were taken in Middle East and Nigeria. That is INR 324 crores. There is an improvement over the last year, whatever we have done. Then BHEL also is coming with a lot of EPC contracts, and there are obviously the opportunities are coming with BHEL power sector, then roads, and then the steel segment will come up slowly.
Then the major features are the O&M and this seems to be a stick in our operations, both in ordering and also in revenue and all. In fact, the order backlog on the O&M has gone up significantly from INR 2,197 crores to INR 2,749 crores compared to last year and this year end. Then, of course, there is an adjustment on the FGD jobs which are slow moving, which is not taking shape because of various factors involved in that. That is about INR 4,262 crores from the BoP side. And then the civil side, there is a significant improvement in the order backlog from INR 7,814 crores to INR 8,472 crores. And then O&M I have mentioned electrical, of course, the business is slowly coming down for the obvious reasons we have taken a business call.
The business is continuing to be driven by the domestic sector with 98% of th`e work, with about 54% of the, sorry, yeah, 60%, the domestic is almost 88%, international is about 2%. Then power sector is about 60% and 40%, non-power sector is 40%. Then the MDO, the backlog has gone up from 57,000, sorry, INR 57,000,053 crores after adjusting INR 53,994 crores because of the FGD adjustment. Then, of course, there are certain things on the market side we have to understand is that some requisite of order backlog initial last year was due to the lot of elections process which was there. So the general elections and the state elections, that was why many of the tenders were postponed. And later on, it has picked up in the second, third, and fourth quarters. Of course, that election period, there was an obvious growth in market.
That is one of the things. But as far as the general business involvement is concerned, is that power sector is taking a big shape with about ongoing contracts of INR 2 lakh crores. And new investments are expected about INR 4.5 lakh crores because of the ramping of the capacity from 220 MW to almost 300 GW. Then railways, as usual, and then both the investments continue to go with the same pace. And there is an improved opportunity in the case of Middle East and then in West Africa. That is where we are trying to give attention for the new investment which is coming in the power sector there in a big way. This is as far as the general thing. And then we are at present looking at a total opportunity for the current year, about INR 30,000 crores.
That should be a combination of the power sector because in the case of power sector, I would like to be single certainty feature. If you look at it overall for the last one or two years, total ordering which has come in is about 32,420 MW, worth a value of INR 196,705 crores. There's a significant order input into the system, EPC orders, and then BTG supply orders, and then certain other miscellaneous orders which have been placed by various customers. Major customers which have placed orders on BHEL and also L&T, Adani about 10,920 MW, and then NTPC about 11,580 MW. Then DVC 3,200 MW, NLC 2,400 MW. Then the orders also come to BHEL and L&T from Mahagenco 1,600 MW, Singareni 800 MW, and GSECL, Gujarat State Electricity Corporation Limited 800 MW. Then Chhattisgarh State Power Generation Company 1,320 MW.
Therefore, BHEL is fresh with orders. That is one of the positive things, obviously. BHEL has got a total ordering of something like 29,420 MW for INR 169,182 crores. L&T has secured two major orders at Nabinagar and Lara, 4,000 MW, about INR 27,523 crores. Total Adani orders to BHEL is about INR 31,270 crores, mainly BTG supplies and also BTG supplies for about 10,920 MW. And then total NTPC orders to BHEL is 7,800 MW for INR 58,090 crores. Therefore, total NTPC and Adani orders to BHEL is INR 89,360 crores. And BHEL for the last year has secured INR 92,532 crores and with a backlog of INR 1.95 lakh crores. Of course, L&T and BHEL are the major power sector players.
Therefore, if you look at the present and future, the annual capacity addition should go into 8,000-10,000 MW of significant opportunity. Then O&M opportunities will increase about INR 1,200-1,500 crores per year only in the new capacity which can come up. The Central Electricity Authority has planned a commissioning program of 16,760 MW in the current year. Of course, last year there was a setback in the commissioning. All those projects are going to be commissioned in this year. Plants under construction is more than nearly 33,000 MW. Therefore, apart from that, because of the impetus on the capacity and thermal power to manage the grid stability, there are ongoing plans and development plans for various power developers and all up to 40,000-44,000 MW that can enter into the investment of nearly INR 4 lakh crores. Therefore, power sector is really booming.
It will go up another three, four years in terms of ordering, and then in terms of capacity go to 2030, 2032. And then as part of the national infrastructure pipeline, we have seen the continued focus on the road, railways, infrastructure, metro jobs, water systems, etc. That is how we look forward to the opportunities will continue to be more and more available for the company. And then oil and gas is a new shining aspect in our operations and all. That is what I would like to say. Thank you.
Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on their touch-tone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Pritesh Chheda from Lucky Investments. Please go ahead.
Yes, sir. Sir, a couple of questions on the FY25 number. So if you se`e the mix has improved in favor of oil and, but we don't, and civil hasn't grown, civil has grown less than the company growth. So I believe there should be some level of margin expansion, but we don't see it coming. If you could highlight the reason. Second is on water projects and the receivable expansion. This is called out by a lot of companies. So if you could tell us exactly what is the problem in the water sector and what will be the due course of correction there. And then I have another two questions which are take up.
Yeah. Thank you, sir. With reference to the EBITDA margin, even though revenue, oil and other operations increased also, there is no positive movement in the EBITDA margin. Why is it likely to be less positive mainly? During the year, we received major orders from the power side. So we started the new plants, new projects. The establishment cost will be more at the initial stage. So it will be recovered in the subsequent period. And moreover, this water division, we anticipated more, we planned INR 678 crores of turnover, whereas we achieved only 70% of the targeted number, mainly because of the Jal Jeevan Mission where we are executing projects in water in UP government. The project timelines for Jal Jeevan Mission have been expedited, and since November, there is no certification on these water projects are concerned.
This is basically 50% fund is allocated from the central government and 50% from the state government. Due to Kumbh Mela project planned at UP level, so the state government at both central and state have not allocated any funds during the Q4. Hoping that this quarter we are getting the funds. The realization pending from receivable of around INR 210 crores of water division. There's WIP uncertified portion of around INR 215 crores. Total around INR 415 crores value of INR 425 crores value is pending from the certification as well as the receivable from the UP government in some sense. Regarding Jal Jeevan Mission in some sense. We are hoping that this quarter will expecting some allocation of funds from the central government and the state government. We will recover that money in this quarter.
Okay. So to the first question then, why are you not calling out margin expansion in FY26?
FY26, we are also expecting new orders from the power sector. So more or less we are maintaining at the same level of EBITDA because the MDO business operations have just started. And once we reach the peak rated capacity only, there is a gentle improvement in the margins of concern. O&M side, yes, there's a possibility of increasing the margins, but initial establishment cost will be there for the new projects to start in the current year also. So in my remarks, I mentioned that margins are expected to remain stable, but with the potential upside depending on the contribution mix from the mining segment.
Sir, in the 29,000 MW order to BHEL and 4,000 to L&T, so let's say 32,000, 33,000 MW. In this 33,000 MW, how much of civil and balance of plant will be retained by BHEL and L&T, and how much has been ordered out? So that we come to know what is left to be ordered out.
There are two aspects of BHEL outsourcing it. Now they have got some plans because they've got a huge order backlog, and they see there's limitation on some capacity what is available, which they are using it anyway. Ongoing projects are also there, the old and finishing projects. Perhaps the three or four projects they are planning to do the BoP as a subcontracting at the key areas in the balance of plant. That is coal handling, ash handling, civil works, balance of civil works, and some of the water packages and all. That is going to be there on a sub-EPC basis. That is expected to give a sizeable opportunity of about INR 8,000-10,000 crores in the market. But we are also looking at that opportunity. The second aspect I have rightly asked is the normal subcontracting outsourcing they do for the entire execution.
That is, you know, the civil, structural, mechanical, all those things. That the available, based on the available market order what BHEL has got, we anticipate an opportunity of about INR 30,210 crores in ETC orders, civil orders, and then structural work orders. And L&T also has to subcontract main plant execution work and also balance of plant. And then some of the balance of plant work in civil, structural, and mechanical work. Therefore, from the power sector itself, as far as our type of operations is concerned, there are two opportunities. One is the traditional business, what we are doing in civil, structural, and mechanical work. That is around comes to about INR 30,000 plus crores, including L&T. And the new BOP concept, sub-BOP concept, which BHEL is going to implement it in a couple of projects, that is expected to secure an opportunity of about INR 10,000 crores.
That is what we are aiming at. And that is one of the reasons perhaps will be bullish for the more ordering in the power sector this year. And that will also lead to more opportunities in the oil and gas sector.
How much is ordered out? Or this is yet to be ordered out?
I think it is a progressive phenomenon. What I can say is that at least about 60% of it they have to order it in these weeks. 60% to 70%.
My last question is, what is the scope of work in Kaiga 2x700 MW nuclear?
Yeah, Kaiga is a 2 x 700 MW. This one is expensive. The main work is in the plant, civil, and structural works for the turbine and electrical.
Okay. And who's given you this order?
NPCIL, Nuclear Power Corporation of India Limited.
This is your first time order?
Sir, Nuclear Power Corporation is given to BHEL. BHEL is the.
Turbine and electric. So they gave the turbine and electric to BHEL, and BHEL gave you outsourced the work.
Correct.
This is your first time order, right? In our nuclear.
We are taking nuclear because the type of work, what is in the non-reactor side of the work, that is on the turbine side, turbine and electrical is similar to your power sector. The same turbine and electrical features are there. Therefore, we are quite familiar in doing the structural, civil, and then the turbine foundations and all those things.
Okay. Okay. Thank you very much, sir.
Thank you.
Thank you. The next question is from the line of Jainam Jain from ICICI Securities. Please go ahead.
Good morning, everyone. Congratulations on the set of numbers. Sir, for FY, we need a couple of data points. Starting with unbilled revenue, mobilization advance, and advances to subcontractors against the work as of March 25.
Okay. You want the numbers, sir, to break up?
Yes. Yeah.
One moment. Hello, sir. Are you there?
Hello, sir.
What can I help you with?
INR 890 crores as of March 25. Mobilization given to subcontractors is INR 20 crores, and advance to subcontractors is INR 200 crores.
Advance to subcontractors, sorry?
INR 200 crores.
INR 200 crores. And unbilled revenue is INR 895 crores, right?
INR 890. INR 890.
INR 890 crores. And mobilization advance?
Mobilization advance given to subcontractors or from the clients you are asking?
From the clients.
INR 240 crores.
Okay, sir. And sir, in terms of CapEx guidance for FY26, like last quarter we had guided for INR 750 crores of CapEx in incoming two years. So how much are we looking to spend in FY26?
FY26, maybe around INR 500 crores we are planning to put for advisory and the regular CapEx is together.
Okay. So we will be reading back so that the quarter is. You have guided for INR 500 crores of debt addition in the last two years for the next two years.
No, no. The total, if you want to do a return to debt, we have raised a QIP of INR 240 crores year-mark for equity, for the advisory. Initially, we'll use this money for the CapEx, and the debt will be added only limited, and most likely it will be added next year. INR 170 crores will be added in this year.
Okay. And, sir, initially we had an order-in-flow guidance of INR 12,000 crores for FY25, and right now, as far as I understand, we have an order-in-flow of INR 6,400 crores. So can you highlight something on that part? Like why have we missed out on that purpose with that thing?
So this year we are targeting around INR 10,000 crores order inflow. We have a closing order book value of INR 14,387. So another INR 10,000 crores we are proposing for planning for the order inflow during the year. So around 25% of the revenue growth we are projecting for the current year, which is roughly around 42% of existing orders. And the present current orders also, we can include up to Q1, Q2, whatever orders we receive, we can also plan for Q3, Q4 execution.
Okay, sir. Is there any update on the mining business side on the KBP Mining?
KBP mining, the mining mobilization has already been completed, sir. And BoP Koderma will also start from 15th of April. So they're likely to generate the total productions from Q2 onwards.
Okay, sir. That answers my question. Thank you so much. And all the best.
Thank you. Participants who wish to ask questions may press star and one. I repeat to ask a question, please press star and one. The next question is from the line of Vinay from Hathway Investments. Please go ahead.
Yeah. Just wanted to know, the water works problem that you are saying, the sewer bills, is that localized to only UP government, or is it a much larger problem?
Sir, all these UP water projects are given under the Jal Jeevan Mission, which is the central government is focused on the central government fund basis only. They are given these works to the UP. So UP also is contributing 50% of the fund. So due to Kumbh Mela works, they diverted all funds to Kumbh activities. So they could not be able to allocate any funds from the state side. And central government said Jal Jeevan Mission initially, they have given a timeline for five years to complete these projects, and it expired in November 2024. During last budget, again, they extended for till 2029 these timelines. So the allocation of funds is supposed to happen in April-May due to these present ongoing situations in UP, I mean, strikes and internal issues and other things.
There is a delay in terms of allocation of this Jal Jeevan Mission fund. We are hoping that now the issues are settled, and also probably they will allocate funds. State and central state both will allocate the funds now. We are hoping that these funds will be collected during this next month.
Yeah. My question was, is this only with UP, or do you have water works projects outstanding receivables from other places also?
JJM funded projects, where the 50% fund has to be allocated from the central fund.
So it is the central fund that is spending, not the state fund?
State also because UP, because of Kumbh Mela, they diverted funds. So now they are allocating funds now. So except UP, the rest of the people, there is no problem. But there is a 50% allocation happening from the state side.
So if you can just tell us, from the unbilled revenue of INR 890 crores, how much is pending due to water works? You said INR 215 is for UP. For others, how many more?
No, we are executing water works only in UP. There are no running.
Okay. So INR 215 out of INR 819 is for UP, for the water works?
Yes.
Okay. Secondly, your order book for the year last year was how much? 17,000 something, right?
Yes. Because there is an activity ongoing, as I said, that which we removed it from the order inflow. And after removing that, it is 14,000 and 4,264, which we have adjusted in the current order. And then after adjusting, 14,387 is the actual running order.
So that has reduced from 17,446 of last year? Or what was the figure last year? Similar figure?
Yeah. 17,362 to 14,387.
Exactly. Okay. And what percentage of your total revenue comes from water works?
Water works approximately around 10%. Last year, it was 20%, sir. This year, we achieved around 9%.
The total order is INR 2,723 crores. And then there is another additional order of INR 699 crores on the oil and electric side. The oil and electric has to pick up. Mostly more connections are given. And the INR 273 crores, that is the base on which we will take funds. And we have completed around INR 1,864 crores for the last two, three years.
This year, we achieved around 9% of the total turnover.
Okay. Thanks a lot, sir. Thank you very much.
Thank you. We'll take our next question from the line of Ankur Kumar from Alpha Capital. Please go ahead.
Hello, sir. Congrats for a good set of numbers. Sir, I wanted to harp upon the guidance for the next year. So earlier, our guidance was INR 7,000 crores. Now you are saying INR 6,500. Am I right, sir? And what is basically, is it like the Jal Jeevan, which is calling us to reduce this estimate?
No, sir. Actually, we actually planned last year around INR 10,000 crores after inflow. The inflow was reduced because of the last year due to general elections and other issues. So we could not be able to get more orders. And even power side, also, there is not much orders except last Q3 and Q4, we got the major orders. That impacted the order inflow. And now the existing previous track is that we are executing 40% to 45% between opening order value. So based on that, we revised the value to 6,500 level. And whatever mining also, the offtake arrangement is not happening at Tasra because of the outside advisory capacities are not available. So we are conservatively considering this growth of 25% because this year also, we achieved only 25%. So in the same range of growth, we have projected.
What is the order backlog right now, sir?
14,387, sir, without MDO.
Without MDO. Okay.
Yeah. Plus INR 972 crore value of orders we received during Q1. So around 15,200 is the right number as of today.
About this total order book that we have INR 53,994 crores, when will this be executed, the rest part?
The remaining is the MDO order, sir. This is 25 to 28 years of period in the execution of the 10th order. All two and all 25 to 25 years of time.
Actually, there are two aspects of this backlog order. When we say it's a traditional business, what we are doing, that backlog is about INR 14,387 crores. That cycle time will be the spending of the cycle time will be somewhere between two to three years, generally. That's why that 40% ratio comes for the revenue data. Whereas, as Arvind has rightly said on the MDO orders, the two MDO orders, that is where it's not a long duration period as a matter of mining and then selling the mine products to the coal, the posting coal to the customers. That has got a longer period.
Sir, this year we expect INR 10,000 crore order inflow.
Yeah. Yeah. That is based on the couple of developments. One is the huge order flow which has gone into BHEL and L&T. And further orders are expected, yeah, on the power sector because the government is keen to ramp up the thermal capacity to avoid the grid problem. Second is the perhaps expected offtake which will come up in the infrastructure, the railways, roads, and then some of the private sector investments also is expected to come. For example, Adani is making huge investments in power sector also. And then JSW is making investment. JSW is coming with the investment. And then infrastructure, we expect the continued progress will be there. And that is why because we had achieved, if you look at it, in 2023 to 2024, almost INR 8,850 crores. Therefore, the company has got that where we are to manage the state of orders.
That is why we went to the order of INR 10,000 crores. Lots of orders in execution because of so many other factors.
Got it. And sir, in terms of next year that is FY27, what kind of execution do we expect to have?
We are targeting 20% to 25% of growth, sir, next year also. Roughly around INR 7,800-8,000 crores, sir.
Sure, sir. Thank you and all the best.
Thank you. The next question is from the line of Mudit Bhandari from IIFL Capital. Please go ahead.
Hi, sir. In terms of our MDO projects, so firstly, whether our washery we earlier expected to complete in September 2026. So whether that is on track, and secondly, for FY26, what amount of revenue for both MDO projects would we be able to get? So I think earlier we said around INR 300 to INR 400 crore. So whether we'll be able to achieve that?
Yes, sir. We are on track, and we are targeting to complete the washery by September 26. So far, we have placed an order for INR 120 crores worth of machinery. We ordered, placed an order, and the balance also we are following. So the washery, major equipment ordering, so we already completed, and LOIs already issued to the vendors. We are targeting to invest almost INR 500 crores of investment during the current year itself. So that we can conclude, I mean, we can close the washery by September 26.
Okay. Got it, sir. And secondly, in terms of our debt, so you said we will not increase any net debt from FY25 level to FY26. So we can expect that net debt to remain stable. Is that right?
Yes, sir. We are.
On an overall basis.
We are focusing on the realization of receivables from the water division, and we want to reduce my working cap utilization. This year already I utilized more debt than the last year. We will take the term loan for this washery. Maybe utilization will, for the timeline, we'll use it from our LC facilities and working cap LC facility to execute the funds. Next year, probably by end of this year, or maybe next year, we'll use the term loan facility for the balance cap requirements.
Got it, sir. And last one from my side. So we said about subcontracting, sub-BoP work, which we expected to be a portfolio of around INR 10,000 crores. So I think earlier you were talking about core BoP project, which had around 50% of the total thermal power CapEx opportunity. So roughly, would you be able to give an idea that what this INR 10,000 crore is, what percentage of total thermal power CapEx?
Sure. See, I told you, as in the traditional part of the business, both L&T and BHEL comes to INR 37,000 crores. And then there is going to be some sub-BoP things which I'm expecting as of today, the reading can be a couple of two, three projects can be there because they have called the tenders for the Singareni also. And Kawai they have already awarded for the 800 MW BoP. And now the Korba West has come, which BHEL has taken a value of INR 11,800 crores recently for 1,320 MW. And that is where we are expecting another INR 10,000 crores from the sub-BoP opportunities. And it can go up also based on what the BHEL decision takes place. But whatever is the balance, it has been already taken up. And then the Adani portion of the orders, there is no construction which is done under the BHEL.
It will be done by Adani directly, and we are working on that. We are for about 4,800 MW of various ordering is in the process, and we already taken orders from Adani for the new orders for the BHEL as a construction part of it. Therefore, L&T, they have to start the subcontracting work for their INR 27,523 crores of ordering. That should be expected in a couple of months to start. Therefore, BHEL, it depends. One is on the BoP, I told you, and then on the traditional business, about INR 30,000 to INR 110 crores. That is what, as of today, we are keeping a track.
Okay. Got it, sir. Thank you.
Thank you. The next question is from the line of Krupa Desai from Electrum Capital. Please go ahead.
Hello.
Ma'am, I'll request you to use handsets.
Sir, my questions are already answered. Yeah. Thank you.
Thank you, ma'am. The next question is from the line of Maitri Shah from Sapphire Capital. Please go ahead.
Yeah. Hello. Can I order this?
Yes, ma'am.
Yeah. Congratulations on the great results. I just have one question. So for the MDO project, what kind of projections are we giving for the revenue for next year? So previously, we said around INR 300 crore to INR 400 crore of revenue for FY26. Are we still sticking to that guidance?
This year, we are planning around INR 208 crores from the Tasra mine and INR 64 crores from KBP. Both together, INR 272 crores we are projecting now.
Right. And this will be over the INR 6,500 crore guidance that you've given?
Yes. Yes. Yes.
Okay. Okay. Thank you so much.
It's with the part of INR 6,500 only, ma'am.
It is a part of INR 6,500. Anything over this will be added to the guidance?
Yeah. Yeah. Yes.
Okay. Thank you.
Thank you. The next follow-up question is from the line of Vinay Nadkarni from Hathway Investments. Go ahead.
Just one question on this. You are saying there's some ongoing order in Bangladesh. What is the size of this order, and is there any issue on that because of the disruptions there? And how much have we executed already?
No, Bangladesh, more or less, most of the jobs we have closed. There is not much to be done. As of today, we are taking a better look, looking at the situation, not so much this one prospect to go into Bangladesh.
So no receivables outstanding there?
Around $500,000 receivable is there. And the final bills are under process. So we are expecting to receive these bills also by the next couple of weeks.
Okay, and these are unbilled receivables, right? No LC backing or anything?
Nothing, sir. It's EPC. Sorry. Regular transaction receivables.
Thanks. And just one observation. If you can just look at your India map on your slide level, I think you should correct it.
Okay.
Thank you.
Yeah. Yeah. Okay.
Thank you. Before we take the next question, we would like to remind participants that you may press star one to ask a question. The next follow-up question is from the line of Jainam Jain from ICICI Securities. Please go ahead.
Thank you for the opportunity. Sir, on the K27 of KPD, we have excluded FGD order value of INR 43 billion. Can you please help me with understanding why have it in there?
See, the implementation timelines for these FGD systems were revised by the government of India time to time, and the regulatory approvals were also delayed. The Ministry of Power issued recently also some directives that effectively they extended the deadlines for its FGD implementation to the year 2029. Because there is no slow movement of these FGD orders, and clients are also taking delay in terms of giving directions to us for the execution of these projects. We have taken, after discussion with the negotiations with the company, so mutually we decided to remove from the order book to the extent of non-moving orders circumstance. Around INR 4,264 crore order value of these Kawai, Tiroda and Mundra projects, we excluded from the order value, sir.
Okay, sir. I got it. Thank you so much.
Yeah. Basically, the Supreme Court has taken a decision because so many factors were there because of the complexity of issues in implementing new FGD orders. And one is the retrofitting space issues. Then power purchase agreement amendments, all these things were there. But then technology issues, outsourcing, then supply chain. Therefore, they have extended it. This is not the first time any extension is taking place after November 2029. And obviously, the developers who are having uncertainty on the power purchase agreement amendments because these discoms have to pay higher tariffs on. The requirements were slowed down on this. That is one of the they have to take consideration of discussing the current.
Thank you. So the order has not been canceled, but it has been delayed for the next few years, up to next year, right?
Yeah. Yeah. It can be reversed, but as of today, it's not in our book, and we are all right to settle whatever work we have done. One project we are doing at Udupi, that work is going on INR 963 crores. We have done about 35% to 40% of the work that will be done. But the rest of the projects, as Aravind said, that is not there.
Okay, sir. I got it. Thank you so much.
Thank you. The next question is from the line of Dinesh Kulkarni from Finsight. Please go ahead.
Hello, sir. I'm audible?
Yes, sir.
Sir, thank you for taking my question. Sir, my question is, as you mentioned, we are facing some issues with the water division. Do you think this is something like, I mean, it's going to impact the industry as such in terms of receivables? Or there are, in terms of order, not enough orders that you were expecting earlier, and this is going to persist for the next few years, or this is like a temporary phenomenon? So what's your view on that?
It's a temporary phenomenon, sir, because of the timelines expiry. So the last budget has extended the timelines, and only they have allocated the funds to these projects by the central government due to their ongoing issues with cost and other things. So there is a delay in terms of allocation of funds. In the time the funds allocation happens, the department is not certifying these bills unless without the funds availability. So we are executing the projects, and almost around INR 350 crore worth of INR 425 crore worth of works are already executed and pending for different stages of certification. Once the allocation of funds happens from both central and state government, they'll release the funds. It's a temporary phenomenon.
Okay, sir. That sounds great. But I would like to know more about, in terms of the next three, four years, what's your view? Will the allocation of funds be there to execute this project, or do you expect a decline in the funds allocation itself in terms of what's your in terms of division or in terms of industry, what's your take on that?
This is a UP project-specific issue, and these projects almost we completed more than out of INR 3,000 crore, we completed 1,800.
INR 164 crores.
INR 1,800. INR 164 crore. And within a year, we can complete these works. There is no issue. Once they allocate the funds, we can speed up the works, and we can complete this in a year's time. But more this one's status is that they have reached almost 80% of the outreach of the functional household tap connections required for about 19.2 crores of households. Therefore, it has taken a good shape. That was UP was a specific issue. Balance 15% to 20%, I think this government is determined to complete it. Maybe another two years maximum.
Okay, but so we expect more work to come in this division, or this will be a stable, there is no growth you expect in the specific division for our company itself?
As of today, there can be some opportunities because southern states, there is some backlog of house connectivity for the drinking water. That we are looking at in some of the southern states, and also Maharashtra, Andhra Pradesh, Madhya Pradesh, and then Tamil Nadu. That we will see to it as and when it comes, we will take it up. That's one of our expectations.
Okay. Sounds great, sir. Sir, my next question is in terms of the CapEx, which you just mentioned that we'll be having somewhere around INR 500 crores for this year. But how do you expect for the next three, four years? Will it be this level, or expect it to come down once we have the MDO in place?
No. The way we have regular QIP will be around INR 80 to 100 crore year- on- year, sir, for regular business. And for the QIP-only specific activity where we are planning to raise around INR 450 crore down the line. Remaining balance, we have QIP funds that are available. So INR 450 crore utilization will happen in the next couple of years.
Okay. Sounds great. And sir, my last question. Maybe I just want to know what in terms of management, are we expecting any succession planning in terms of increasing the bandwidth of the management? Because I know we're doing a lot of work. So anything on those aspects?
The MD Sajja Kishore Babu, who is rotating to BD, he is only handling right now the operations of the company and the major business development and admin and HR. So other new areas of activities which he is trying to get more new line of activity as a strategic piece. We want to induct them into the board. Maybe. Next couple of weeks, we will properly decide and we'll implement. More than that, we are also strengthening our organization, overall organization. Of course, that is the main thing what we need to take the lead role. He's already doing substantial work on operations, business development. He's completely looking at it. And he's looking at the routine aspects also and supporting to CMD. But the organization growth is there because of the new opportunities that come in the infrastructure and power sector. We have taken some senior-level people also.
There is a substantial augmentation in our manpower resources, both in our own regular manpower and the subcontracting manpower. What was about 34,335 headcount, including Power Mech, and then the subcontracting labor has gone up to 37,295 by April 25, an increase of 8.6%. Then O&M, because of the improved order backlog and all, the manpower headcount in O&M has gone up from 40,069 to 18,296. Therefore, parallelly, the organization strengthening is also going. Some reorganization also is going to keep up with the customer requirements.
Okay. So that sounds great. Sir, maybe last question from my end. Sir, see, we are seeing a lot of things happening on the defense front in India, which whatever we have witnessed in the last couple of weeks. So do we expect to do anything in this industry, in this segment, from the company perspective?
I think defense is a little bit of as you know, it's a high-end technology, and a lot of technology input is required. And that focus is not there. What we are now focusing on is the new energy businesses, such as battery energy storage and solar power. Certain projects we are looking at it. Third, battery energy storage, the government plan is to ramp up the capacity to 50,000 MW by 2030 to 2032. There we want to see as a developer and certain opportunities we are also looking. And solar power also, we are looking at as an opportunity, as an investment also. That is our.
Okay. So any organic part we are looking at? Any acquisitions and stuff like that?
No. Right now, there are no opportunities, sir. But non-power O&M side also, we are looking at. Right now, we are more concentrating in the power O&M. Lately, PSCs are also outsourcing O&M of metros, material handling systems, process industries, and airports, creating more high-potential opportunities out there. We are looking at this space also to get more O&M.
Okay, so you expect next phase of growth from O&M itself, right?
Yeah. O&M and non-power side also, we are majorly.
Non-power, we are already working in certain divisions.
Water division, we are working.
Like NMDC, JSPL, RIL, and GMDC. And then `water project, for example, UP water project also has got a non-power segment. It also has got our 10-year O&M, which is built into the system, which we have started as and when it gets commissioned. And then one of the areas we have entered is that township construction also. Recently, we have taken INR 972 crore from the TSGENCO for the project in Telangana. Therefore, that is a new initiative we have taken.
There are a lot of international infra opportunities also there, sir. Middle East, particularly Middle East, Africa infra investments. They've opened up overseas ETC or O&M projects potentially. Especially through local JVC, we can look at those opportunities also in terms of.
Okay, sir. That sounds great. Thank you very much and all the best.
Thank you. Ladies and gentlemen, as there are no further questions from the participants, I now hand the conference over to the management for closing comments.
Yeah. Thanks for the investment team and also our team here. I think the key takeaways are that the company is looking for expanding the business in O&M infrastructure until the new opportunities come in the power sector, both for the administration, BoP, and our one of the new initiatives is the balance of plants doing undertaking complete jobs. That is because of the in-house spends we are having in execution to give some substantial value to the company's operations. And then we go more focused on the Middle East because the investments are expected to come up in Middle East for the energy sector, which was done now, particularly Saudi Arabia, and then UAE, and other Middle East countries. A lot of opportunities are coming up.
And we are also looking at some opportunities along with Maithan Group in the mineral and material processing, with the new investment coming from the Vedanta side and then NMDC and then so many other developers. Therefore, overall, the growth momentum should be there except for the last year's this one we had. And INR 10,000 crores of order booking should be reasonably targeted in the current year, with about more than INR 30,000 crores of specific opportunities we are targeting as of late.
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 lines.
Thank you. Thank you.