Ashoka Buildcon Limited (ASHOKA) Earnings Call Transcript & Summary

Ladies and gentlemen, good day, and welcome to the Q1 FY '23 Earnings Conference Call of Ashoka Buildcon Limited hosted by Centrum Broking Limited. [Operator Instructions] Please note that this conference is being recorded. I now hand the conference over to Mr. Ashish Shah from Centrum Broking Limited. Thank you, and over to you, Mr. Shah.

Yes. Thank you, Margaret. On behalf of Central Broking, I welcome everyone to the Q1 FY '23 Earnings Conference Call of Ashoka Buildcon Limited. We have from the management, Mr. Satish Parakh, Managing Director; and Mr. Paresh Mehta, CFO; and we also have Stellar IR connected on the call. So let me begin the call, and over to you, sir, for the opening remarks.

We would like to exchange a warm welcome to everyone on earnings conference call for the first quarter that ended June 30, 2022. Along with, I have Mr. Paresh Mehta, our CFO, on the call. Let me start with key developments in the first quarter of FY '23. Company recorded an order book of INR 14,780 crores backed by healthy order intake. Let me now give [Technical Difficulty] of ACL projects. As mentioned earlier, we have entered an asset sale transaction of Ashoka Concessions Limited of 5 SPVs by entering into a share subscription and share purchase agreement with Galaxy Investments II Private Limited, an affiliate entity of KKR. The deal is to be completed soon after receiving required approvals from lenders, NHAI and other relevant stakeholders and completion of certain condition proceedings. We have received approvals from a few lenders and other stakeholders. We are in process of completing the entire process and balance CPs. The deal transferred the entire share capital of these 5 BOT projects SPVs, including repayments of shareholders' loan for an aggregate consolidation of INR 1,337 crores. The total proceed received will be utilized to facilitate the exit of SBI Macquarie from Ashoka Concessions Limited, allowing SBI Macquarie to exit the company fully. Further transfer of these 5 SPVs will reduce the consolidated project date of ABL by INR 3,014 crores. Also, we have executed a share purchase agreement with National Investment and Infrastructure Fund Limited for a sale of 100% equity of Chennai ORR for an aggregate financial consolidation of INR 686 crores. Out of INR 686 crores, ABL is expected to receive INR 450 crores. INR 250 crores towards loan repayment and INR 200 crores towards 50% equity stake in SPV. Post this transaction, the company will remain with the following major highway portfolio. 74% equity stake in 1 toll project, Jaora-Nayagaon; 3 fully owned annuity projects, Hungund–Talikot, Bagewadi-Saundatti and KSHIP; and fully owned portfolio of 11 HAM projects. As mentioned earlier, we are in discussion for equity sale of the Jaora-Nayagaon toll project. Coming to HAM projects, we have executed an construction agreement with NHAI, worth INR 1,079 crores for development of 6-lane greenfield highway from Baswantpur to Singondi, section of NH-150, on hybrid annuity mode under Bharatmala Pariyojana. The construction period is 912 days and the operation period is 15 years. The total equity requirement of 11 HAM projects, including PIM, is about INR 1,337 crores, of which we have already invested INR 1,107 crores, including [Technical Difficulty] as on June 2022. Coming to the order book. As mentioned, we have achieved a robust order inflow. Some of the key and large orders received from 1st April are as follows. As I said earlier, we have executed a construction agreement of INR 1,079 crores for development of 6-lane controlled greenfield highway from Baswantpur to Singondi, kilometer 162.5 to 203.1. LOA from Government of Republic of Guyana, USD 106 million for construction of East Coast Road Linkage at Guyana. LOA for project of construction of Fintech Digital Institute at Jodhpur from Government of Rajasthan for INR 600 crores, this project is in JV, where Ashoka is having 65% stake and Ashoka Buildcon is a [indiscernible] member. This project is to be completed in 18 months. [indiscernible] of INR 208.89 crores for provision of [indiscernible] sector, which project is to be completed in 24 months. The breakup of INR 14,780 crores order book, as of June 30, 2022...

Mr. Parakh, sorry, this is Ashish. Sorry to disturb Actually, we're getting some feedback that the line is not clear. So Margaret, can you look into it because we are getting the feedback that you're not being audible.

Sir, actually, I can hear...

Sorry to disturb.

No problem. Ashish, can you hear me?

Yes, I can hear you.

Yes. I'm saying...

Ashish, can you hear me clearly?

Sir, I'm able to hear, but I'm getting feedback -- yes, I'm able to hear you, but I'm getting feedback from some other participants that your line is not very clear.

Okay, okay, okay.

Actually, I can also hear, Mr. Parakh. The volume is fine. So I would request those participants who cannot hear him, can you please reconnect your line.

Right, right. Fine. Go ahead, go ahead, sir. Please go ahead, yes.

The breakup of INR 14,780 crores order book as on June 30, 2022, is road projects compromised about INR 8,929 crores, which is 60.4% of our total order book. Among the road projects order book, HAM road projects are to the tune of INR 3,062 crores and EPC projects are the tune of INR 5,867 crores. Power T&D and others were around INR 2,355 crores, which is approximately 15.9% of the total order book. The EPC Building segment contributed INR 2,302 crores, which is INR 15.6 crores of the total order book, while railways stood at INR 1,142 crores, which is 7.7% of the total order book. And EPC work of CGD business compromises the balance of INR 51 crores. The current order book, including projects received post June 2022 stands at INR 15,355 crores. Let me reiterate that our focus remains to build strong EPC business in the segment of highways, railways, power T&D and buildings. The current order book of INR 15,355 crores provide us with a good visibility of EPC business growth. On the asset portfolio front, we have already built 11 HAM projects portfolio in terms of new project building. Our priority will remain more HAM projects and strengthen the HAM project portfolio further. This is all from my side. I would now request Mr. Paresh Mehta to present the financial performance of Q1 FY '23. Thank you.

Thank you, sir. Good afternoon, everyone. The result presentation and press release for the quarter have been uploaded on the stock exchanges and on the company's website. I believe you all may have had gone through the same. Now I would like to present the financial results for the first quarter ended June 30, 2022. Starting with the consolidated results. The total income for Q1 FY '23 grew by 46% year-on-year to INR 1,916 crores as compared to INR 1,310 crores in Q1 FY '22. EBITDA stood at INR 521 crores in Q1 FY '23, with a margin of 27.2%. Profit after tax is at INR 135 crores in Q1 FY '23. The revenue mix has changed and is higher on the EPC side compared to the HAM due to which margins are impacted. Coming to the standalone numbers, the total income of Q1 FY '23 stands at INR 1,510 crores as compared to INR 1,058 crores in corresponding quarter last fiscal, registering a growth of 43%. EBITDA for the quarter was at INR 176 crores, with EBITDA margin of 11.6%. The company reported net profit after tax of INR 104 crores for FY '23 Q1. During Q1 FY '23, BOT division recorded a total collection of INR 287 crores as against INR 207 crores in Q1 FY '22 and INR 268 crores in Q4 FY '22. Total consolidated debt as on June 30, 2022, stood at INR 7,127 crores, of which project debt was INR 6,015 crores, of which INR 3,014 crores stands for projects -- project debts of 5 BOT projects. NCD stood at INR 250 crores at ACL level. The stand-alone debt is at INR 862 crores, which compares to INR 187 crores of equipment loan and INR 674 crores working capital loans. The stand-alone debt has increased because of delays in collection in the road sector, typically in Q1. However, things have improved since July. Although the total consolidated debt of INR 7,127 crores, INR 3,014 crores will be transferred along with 5 SPVs of BOT projects. Post the sales transition, effective consolidated debt will be INR 4,113 crores. With this, we now open the floor for question answers. Thank you.

[Operator Instructions] The first question is from the line of Mohit Kumar from DAM Capital.

Congratulation on decent set of numbers. Sir, my first question is on the working capital. As you said that the alluded to the fact that the working capital has increased primarily because of delay in getting some receivables. Is it from the EPC or HAM? And at what level do you expect it to normalize in the next 9 months?

So historically, if you see, the September -- the June quarter and the December quarter generally working capitals are slightly higher than what is normal. So if you see the first couple of weeks of July, certain delayed payments of June end were received at the end of more than INR 100-odd crores. And going forward, for the HAM projects, the disbursements would happen in this month. So they would take care of the additional burden of debt. We believe that going forward, this working capital requirement would be in the range of INR 400-odd crores, plus equipment debt of INR 180-odd crores.

Understood. So INR 400 crores is the number which you should see by the end of this -- end of Q2 or fiscal. Is the understanding correct, sir?

Yes, around Q2. INR 400 crores to INR 450 crores.

Okay. Sir, my second question is on the monetization bit. So is there -- you're working -- just like you're working on parallel multiple things. But out of Jaora-Nayagaon, let's say, the sale of HAM through NVIT or to investor, which one do you think is likely to happen near term? And if the HAM are looking for NVIT that will take some time, right? Is the understanding correct?

Right. So as regards the BOT projects -- 5 BOT projects and the Chennai ORR project, we expect to close the deal by September -- around September odd, September or maybe a month or so plus, minus. As far as the other projects are concerned, they are under pipeline, the HAM projects -- the 11 HAM projects are the other 10, which are almost under construction, except for one, which is under FE. These are expected, either there could be a buyer for it or we may go to NVIT. If we go to NVIT, definitely, there is some time away.

Got it. On sir, Chennai ORR, what is the inflow which one can expect from this sale to us?

As we said, the total consideration is INR 686 crores, of which approximately ABL expects to get around INR 450 crores, of which INR 250 crores would be against debt financing to the SPV and INR 200 crores against its equity.

Sir, INR 200 crores will be the free cash flow to us. Is that -- is it right, sir?

Right.

[Operator Instructions] The next question is from the line of Vibhor Singhal from PhillipCapital.

Congrats on strong execution once again. Sir, my question was basically pertaining to the couple of new orders that we have procured. 1 order, as we had earlier announced, is for the railways in terms of the KAVACH scheme that we have announced. That's a decent around INR 186 crores kind of an order. And there's also 1 more order from Rajasthan -- Government of Rajasthan for IT and Communications. Can you just maybe give us some highlight as to what exactly are -- is the nature of our work or the scope of work for these projects?

I think Mr. Parakh is not available on the call. KAVACH is typically the signaling system -- anticollision system which we are trying to -- will be additive. And the Rajasthan project is pertain to Fintech -- building construction for IT -- our Fintech Digital Institute.

Okay. So sir, the Rajasthan project is just about constructing a building for the Digital institute, right?

Approximately 11.56 lakh square feet.

Okay. So our scope of work is just constructing the building?

Right.

And sir, for the KAVACH project, what is our scope of work? What will we be doing?

We will be providing all the necessary equipments for avoiding collision and other railway signaling system.

So are we going to lay out -- laid the optical cables -- fiber cables? Or are we going to basically help them provide the equipment for the anticollision system itself? So our work will be mainly EPC only, right, in terms of laying down the cables and all?

Right. It will be a total solution for this part of the contract.

Right. So sir, just wanted to get more color on this. Sir, I think we have been bidding for a variety of projects now. I mean, of course, we have power transmission, railways and roads, which are our bread and butter. Buildings, of course, something which we've always excelled in. But does -- these seem to be -- I mean, this seems to be an entirely different kind of a domain. So I mean, what is the kind of -- I mean, I just want to understand why are we going into this kind of a domain in which you've never ventured before? The opportunity also this -- it's not a huge opportunity if you look at it in terms of -- if you compare it with roads and buildings or railways. So what is the specific reason that we have gone for this kind of a project? Hello? [Technical Difficulty].

Ladies and gentlemen, we have the line reconnected for the management. Over to you, sir.

So Vibhor, you are on the line, right.

Yes, sir. Sir, did you get my question? Or should I just maybe repeat it once again?

Repeat it. Can you just...

Sure. So sir, basically, as you've mentioned that the details about the KAVACH project, what I wanted to understand was, sir, what is our specific reason for going for this kind of a project? This is completely uncharted territory for us. We've never done these kind of projects before. Opportunity wise, also, I'm sure this project -- this domain cannot be as big as the railways or roads or any other domain that we are already very experienced in. So is it that we are seeing some very strong opportunity in this segment? Are the margins in this segment better? So what is the specific reason for us going into this very niche segment of laying out these optical fiber cables and this project?

See, this is an anticollision safety point of view railway is now putting up this for the entire railways. So there definitely is going to be a big opportunity and only few players are there in this segment, and we have a good control on doing such projects because we had been -- we are dealing with Smart Infra. We're doing hardware and software projects. Actually, we have skills which are required completely for this kind of works and therefore, we have entered into this. And we see a good opportunity going ahead.

So just to maybe ask my first question again. What is exactly going to be our scope in this project? Is it only going to be laying out of cables? Or are we going to provide some electronic equipments also for this anticollision project that you're talking about?

See, laying of cable is a very small portion of the whole order. Mainly, it includes a lot of hardware and software. 60 locations we have to cover and around 403 kilometers of length of highways in Jharkhand, Uttar Pradesh and Bihar, we have to cover. It is completely anticollision system, which automatization is as far as collision is concerned.

So sir, these kind of, let's say, I would say, electronics related or optical fiber cables -- fiber cables projects, are we going to bid for them ahead? And also if they come from, let's say, not from just railways but other departments also, are we going to go ahead with those projects also?

We have been doing this the last 2 years, KEFLON which is Kerala optic fiber network, which we have already done and more than around 20,000 kilometers of fiber laying we have already done. In all our highway projects, we do around 300 kilometers in each project. So this is not new for us. And as far as software and technology is concerned, we are well versed with since last 2 years. So this is a segment which we look forward. Automatization, digitization, this will be another focus area for the company.

Got it, sir. Got it. Great to hear that. Sir, a similar question was on the project from Guyana. So I think, sir, after Mauritius and Maldives, this is the third basically overseas location that we are kind of venturing into. So just wanted to, again, pick our strategy here. Sir, are there some specific geographies that are there in our minds that, okay, we will go to these countries? And if there is an opportunity, then we will focus on these only in these countries? Or are we like open to working -- I mean, in the vicinity of India, are we open to working in any country where we find a good opportunity?

So after completing the first phase of Maldives, we bagged second phase, which is also now nearing completion. And this is a third project, which is buildings housing project, which we are likely to start in maybe Q3 or Q4 of this year. Maldives has been one strong area. Other than this, we have bagged Guyana, and we are focusing on African region. We are in Exim Bank funded project of Bangladesh also. So we have developed an independent vertical after doing Maldives in the last 4 years. These are independent verticals who are doing international projects. And whenever an opportunity there, whenever Exim Bank funding where funding is guaranteed and margins are intact, we are focusing on those areas. So this vertical will be independent like we have been doing power and railways.

Got it. And sir, any target that we have set for ourselves, let's say, maybe 5 years down the line, we want our international order book to be maybe 10%, 15% or nothing like that? It will all be opportunity-based?

100% opportunity-based.

Got it, sir. Sure. Sir, just one last bookkeeping question. If you could just provide -- I mean, after the first quarter results, what is the overall revenue for FY '23 and the margins that we're looking for? In terms of guidance, what we're looking for FY '23 revenue and margins?

From a revenue perspective, we are target approximately a 15% to 20% growth minimum in this quarter based on order book now and the new orders to come in. We will keep on reassessing these values in the Q4 revenue. Otherwise, 15% to 20% is generally okay for the year.

Got it, sir. And sir, margins?

Margins, based on today's costing and others, I think so it would be in the range of 9% to 10% is what we believe going forward, even based on what These are basically because of high cost in certain projects which are taken at prices as an entry -- from an entry perspective.

Got it. So many other players are saying that from Q3 onwards, we might see some uptick in margins because by then, the commodity prices most likely will probably cool off and also projects with -- newer projects will start coming into execution. Do we expect a similar kind of a thing? Or for us, it could be just maybe straight-line work?

That depends on also our international projects picking up because there, margins could be slightly better. So it will all depend on the mix of the projects as well as whatever you have suggested change in commodity prices.

The next question is from the line of Jiten Rushi from Axis Capital.

Sir, my first question is on the revenue breakup. Can please provide the revenue breakup segment wise for Q1 and comparable Y-o-Y?

So our road EPC was INR 1,050 crores against INR 830 crores for last quarter.

Sir, I didn't get -- I couldn't hear you well, sir. can you please repeat?

Can you hear me? Hello?

Yes, now I can hear you, yes.

So road turnover for Q1 was INR 1,050 crores against INR 830 crores for Q1 '22. In the Power division, we had a turnover of INR 160 crores against INR 41 crores. Railway, INR 153 crores against INR 99 crores. CGD business was approximately INR 13 crores over INR 6 crores. And RMC, this is another sale, INR 50 crores against INR 25 crores.

Sir, buildings -- any exhibition buildings, any progress?

[indiscernible]. It will pick up in the Q3, Q4 quarters.

Sir, in terms of the order backlog, so are these international projects covered by cost escalation? Or will -- it is a fixed price contract and we built at a better margin, as you said in a previous question? So this -- so how it works like the international contract in terms of cost escalation?

These are fixed price contracts. International contract are fixed price contracts. And we do get the benefit of dollar going up.

But probably, sir...

We have to estimate in contingency escalation or whatever. With our experience, we need to estimate that. If we go down debt, we can get a hit. And if we are positive, then definitely, it goes positive. But some coverage is there always because of appreciation of dollar or depreciation of rupee whatever.

The mark-to-market risk, you have to -- take into account while you're building for such projects?

Yes, international, definitely.

So then what is the mix between the fixed price contract and the viable price contract in this order backlog almost more than INR 8,500 crores? So almost -- so can you just give me the breakup in terms of percentage should be fine?

It is around 80:20, 80% is around, which is covered by escalation. And 20% are a fixed price contract, where we have to estimate escalation.

So this should be mostly overseas contract, right? Fixed price would be mostly...

Mostly on one of the contracts or even in India, like which we have taken from Adani for West Bengal project.

West Bengal project. Okay. Sir, you had said in the opening remarks about the equity -- the balance equity HAM projects. So what I can see is like total equity invested is INR 812 crores and PIM ratio is INR 294 crores to INR 295 crores. So what is the total equity required, including PIM and excluding PIM? And how much have we invested, if you can give breakup, including PIM and excluding PIM? And then in terms of U.S.

Yes. So excluding PIM, which is typically will depend on how the inflation index moves. But excluding PIM and as well as including the large projects which we won , that is the [Technical Difficulty] project, total equity requirement is INR 247 crores for the HAM projects, which typically...

How much, sir?

INR 247 crores.

INR 247 crores. And sir, total would be how much, including all 11, excluding PIM?

So INR 247 crores plus INR 813 crores.

Okay. That is excluding PIM, okay. And how much is invested so far, INR 813 crores?

We have invested INR 813 crores, as you said. So INR 813 crores is invested, INR 247 crores to be invested. Over 2 years '23 and '24, INR 163 in 2023 and INR 84 crores in 2024.

And sir, including PIM, what would be that number, sir?

Including PIM, so PIM number will vary, but based on our current budgeted PIM, we are approximately -- I'll just -- against estimated INR 380 crores of PIM, we have received INR 294 crores. So another INR 70 crores, INR 80 crores yet to be received. This will change as project goes right. So this is not variable. The committed equity is what we have already...

Basically, sir fully invested in all the 10 operational projects and only 1 is left under construction and operational and mix of both.

Yes. So out of INR 247 crores, approximately INR 115 crores is pertaining to the last project, project Baswantpur, which is yet to be financially closed. So if you reduce that, then the net investment to be done is INR 130 crores on the -- under exhibitions HAM projects.

HAM projects. That's interesting. Sir on the exhibition side, so you said Maldives project is expected to start by Q3 and Q4. But what about this NTPC solar and the Mumbai STP project, any updates, like NTPC solar has been quite some time now in the order backlog, but solar price is not moving.

Could you repeat your question?

Are you going to cancel -- sir, in terms of the order backlog, so NTPC solar project, what is the status? Whether it is going to remain in the order backlog or we cancel it because the module pricing is...

NTPC solar is going on. So it is in the order backlog.

But what about the increase in module price? Sir, any cushion we have? Or we have to pay penalty for that? What is the status as of now, sir?

As of now, we are progressing without modules, and we have discussion with the authorities. So until now, we have not reached any solution.

And sir, on the -- last question from my side. On the [indiscernible] KKR and NIIF, what is the outstanding equity and debt in Chennai ORR as of now?

Debt is approximately INR 650 crores in Chennai ORR. And equity -- invested equity is approximately INR 189 crores.

So this is including loss funding and some debt, this equity of INR 189 crores is?

No. So this is basic equity. And support given by Ashoka Buildcon is approximately INR 250 crores, which we have -- which will be returned when the deal happens.

INR 250 crores. And sir, on these 5 projects Durg, Bhandara, Dharwad so what is the current status of outstanding debt and the equity in terms of basic equity and support?

On the 5 projects -- BOT projects?

5 projects of KKR and equity investment.

Yes. So these -- in these projects, approximately INR 2,200 crores was the invested equity and support debt, which we are liquidating at [ 13 37 ]. So this is the position. And as of 1st April 2022, project typically is there, we are just finishing the -- we are taking care on there. We have -- once the transfer happens, it will be their project.

So basically, equity -- what is the breakup between equity and support, if it is possible to give?

Equity is approximately INR 735 crores and debt is the balance.

Balance is support debt. Okay.

This debt is inclusive of both kind of debt. Some -- what you call, construction debt also. So construction is funded part equity, part debt. And then debt also is in the form of support debt majorly for projects like Sambalpur.

The next question is from the line of [indiscernible] from Elara Capital.

Sir, so I had two questions basically. First, have you started with the Adani road project in West Bengal? I mean start from Q2 onwards or something if you can just provide an update on that?

Yes, this project has already started, and 12% progress has been done on this project.

Okay. And the second question is, so we'll receive around INR 600 crores -- so from -- INR 140 crores from the KKR deal as well as INR 450 crores from the Chennai ORR by September or probably Q3 onwards. So what are we going to use that money for? Is it going -- are we going to pay off our debt on a stand-alone basis? Or are we going to give it as a dividend to our shareholders or something, if you could provide some guidance on that?

No. I mean we will come to the stage when we are steady. There could be both options we're talking about, debt on certain projects we've recurred. But otherwise, I think we take the step when we are very close to the realization of the cash.

And by when will we get the money?

We should [Technical Difficulty] is September. So somewhere around that period, maybe depending on permission from NHAI. It may be plus minus 1 month, 2 months. But otherwise, we expect that, September is the -- the date is September.

The next question is from the line of Nikhil Abhyankar from DAM Capital.

Most of my questions have been answered, but I would like to go back to the margin. Sir, historically, our margin has been in the range of 11% to 12%. And some of the companies have also seen a sequential increase in the margins in Q1. So what exactly is the reason you're saying that will be -- will take around 10% irrespective of the international orders?

See, it -- our order book is a mix of projects which are bid at various margins. The HAM project would bid at 13%, EPC around 11%. And the new entry 11 projects may be slightly lower just from an entry perspective. From that perspective, the mix would typically result in 10%. This is also taking into account that the escalation continues to be as it is. If the escalation improves, the commodity prices reduce, then this margins could go up.

Okay. So is it fair to assume that the share of EPC execution will be very higher in this financial year?

Yes. That is true.

Sir, just can you give us the breakup of it? What can be the revenue share from each segment? .

So -- see, basically, I mean, immediately, I would not be in position to tell you what is -- could -- HAM is approximately INR 3,000-odd crores, of which almost 65% to 70% -- 60% would get over by March '23. So rest all will be EPC contract. So out of the total revenue estimate of around, say, INR 5,000 crores, INR 5,500, crores, INR 2,000 would be contributed by HAM projects and rest could be EPC, either road or other sectors.

The next question is from the line of Parvez Akhtar Qazi from Edelweiss Securities.

So a couple of questions from my side. First, how do we see the competitive intensity in the various segments where we are bidding? And going ahead, what is the kind of mix in terms of order intake from various segments is what we are targeting?

See, our focus should remain on highways. This could be a mix of HAM and EPC, NHAI and MoRTH, NHIDCL or it could even states like we did UP, Bundelkhand Expressway and all. So it's all the opportunities which are coming up in Q3, Q4 will decide the mix. But our definite strength is highways and our focus will always remain. In addition to highways, we are simultaneously developing our power portfolio, railways portfolio and building portfolio. And while doing this, definitely, there are challenges in terms of PQ, TQ and getting JV partners and bidding like getting entry into this sector and getting established. So this is a phase where we are developing new verticals so that overheads are also going up.

Sure. But what is our sense on the competitive scenario for NHAI? And especially post-COVID, we have seen very significant competition there. Do we expect that it will moderate this year? Or we expect it will probably remain at these levels only?

Very, very uncertain to predict competitive aggression in the market. Last year, we have seen a huge aggression. Going ahead, I don't know Q3, Q4 should show enough order. And those people who have taken aggressive projects also will understand what exactly they have done. So reasonable sense should prevail. But looking at the qualifications which have been diluted, we do not know whether new players come in, jump in, whether aggression will remain, not remain. And that is why we have decided to ourselves put into various sectors and become all round EPC player.

So what is the status of land availability for the 11th HAM project and also for the Banur-Kharar project?

The land availability for most of the project is 80% plus, except 1 project which where we're suffering is Punjab, which is IT project. Other than that, we are comfortable on land as well as other HAM projects are comfort. NHAI is very straight forward in giving And if land is not available, they are even ready to bespoke it. So land is not going to really affect the portfolio to a major extent.

Sure. And just one bookkeeping question. What is the CapEx that we incurred in Q1? And what is the equity that we infused in Q1?

So CapEx in Q1 was approximately INR 15 crores, and equity invested in Q1 was INR 77 crores.

The next question is from the line of Jiten Rushi from Axis Capital.

Sir, on the CapEx front, what is the target for full year because you have done INR 915 crores now. So full year target?

So we have approximately budgeted total CapEx of approximately INR 150-odd crores where the new projects which will take off in Q3, Q4 will require. So this is approximately INR 120 crores to INR 150 crores is what CapEx we intend to do by March '23.

So this high CapEx we can expect in '24 also because new projects will come into execution. So FY '23, we'll see that high CapEx and Q4, we'll see suppression in CapEx. Any thought on that, sir?

I think so this CapEx should be sufficient to take new orders also. And FY '24 should be typically not so hard.

A few bookkeeping questions from my side. If you can give the June ending numbers for debtors, creditors, inventory mobilization advance, retention and unbilled?

So for the June ended, the debtor position was around INR 1,000-odd crores. And against which advances was around INR 442 crores. And trade payables, INR 847 crores, and unbilled revenue around INR 1,200 crores.

Retention, sir, and inventory?

Inventory is what I said, [indiscernible].

Sorry, how much, sir?

Inventory is INR 120 crores. WIP, which is called unbilled revenue, INR 1,200 crores, yes.

And sir, retention is how much?

Pardon?

Retention money outstanding?

Retention money would be approximately INR 183 crores.

INR 183 crores. And sir, in terms of order inflow, so what is your guidance for this year? Because our first quarter has been really good. And Q4 order inflow has been really good and it has been accumulating the order backlog. And all the focus is on execution. Any thought on what is the target for orders inflow this year? And also, what is the current executable order backlog?

So order backlog, I told you, it's INR 15,000-odd crores.

I'm asking executable. So there could be projects which are yet to start execution. So what is the current executable order backlog because we have significantly a number of projects.

There are only 2 or 3 projects which are yet to start. Others will all take off in Q3, Q4. Maybe one of these projects will go to Q1 of next year. So we can say around INR 13,500 crores to INR 14,000 crores is what will come under executable.

And sir, the order inflow target for this year end? And what would be the mix in terms of order inflow?

Yes. The [indiscernible] and Ministry has been aggressively announcing that they want to really bid on more than 8,000 kilometers this year. And what they have done is only 2,600 in Q1 or till date. So Q3, Q4 should throw up a lot of bidding opportunity, particularly with the Ministry of Road, Surface and Transport and also some of the other states would throw up a good opportunity. Other than these, railways, we see will throw up a good opportunity. So in the order inflow, our target is around...

Yes, sorry, how much, sir?

Our order intake, it would be around INR 6,000 crores to INR 8,000 crores we should bag in Q3, Q4.

This is the additional you're talking about for the next 8 months?

Additional, additional, yes.

And sir, on the Jaora-Nayagaon, when can we expect any conclusion in terms of I think you were in advanced talk last time?

Yes. So we are almost in serious discussions on the documentation part, and we should be completing any time. So maybe a 1 week or 2s time to see some [indiscernible].

We can see [indiscernible] in 1 week or 2.

The next question is from the line of Mohit Kumar from DAM Capital.

Sir, my first question is the -- when you talk about Power segment, are you talking primarily about T&D -- state T&D opportunity? Or do you still think you would like to do more solar? Or solar is a complete no, no right now -- no, no going forward?

We see it can be T&D or it can be solar. Now only what precaution we need to take going forward is not taking any fixed price contracts. So our focus will be on contracts where escalation is pass-through.

Does it mean that you're looking only for private PPC contracts because I believe that all the PSU contract comes with a...

No, all the PSU are also coming up with variable They are ready to pass through the -- and particularly for solar, the models are now being provided by government. So they are going to the new policy, then come up with this policy where model part will be taken care by them.

Understood. Secondly, sir, from the sale of Macquarie, if I believe there will be a tax shield available, right? So that will reduce our outgo from the sale which you'll do in the future. Is that a fair assessment?

Tax shield from what perspective, sir?

From the sale of the toll road, which you're doing at lower than book value, right?

No. So I mean, I don't -- no tax, I mean there would be minimal tax -- capital gains tax. But otherwise, there's no tax shield as such.

Okay. Sir, I'll take it offline, sir. Sir, thirdly, what is your margin aspiration in medium term? Are we aspiring to go back to the 11%, 11.5%?

This will all depend on prices -- commodity prices, bidding intensities. So I think it's the call which we will take. It will be in the range of 9% to 11% or maybe around 12% if the opportunities are better.

And lastly, sir, are you seeing any BOT opportunity in the -- from the NHAI or other some states?

Not really anything significant.

The next question is from the line of Vibhor Singhal from PhillipCapital.

Sir, just following up on Mohit's question which he asked just now, I think what we're trying to ask is that, as you mentioned that we have invested INR 2,200 crores of equity into the Macquarie portfolio and we are selling it for INR 1,300 crores. So is there a capital loss that we would be booking, which will give us the benefit of any tax credit that we can utilize there on? Or will this not be the case?

Yes, I think so -- can you hear me?

Yes, sir, pretty much.

So there would be CapEx losses, which should be available level to be absorbed in future.

Okay. So that would be at ACL level, right? But because the investment has been made from Ashoka Buildcon level, would that also result in some tax benefits? So what you went by tax shield is already tax benefit that we would get from this sale which you can utilize in the future years? And if yes, is there a quantum to it that you can probably provide at this point of time?

At present, at ABL level, there will not be any significant movement because ABL will continue to hold ACL as a...

Okay. Right. Got it. So the benefit will all be at the ACL level?

Right.

Got it. Got it. So just one small more question on the order book. Sir, 2 projects, one is this Banur-Kharar project in the EPC road segment, and the other is the Kwaram Taro in the Assam. These projects haven't seen any execution for the past 4 to 5 quarters. So any specific reason that these projects are not basically showing any progress? Are they stuck somewhere some land...

The Assam project, we have just received appointed date. Progress will start in Q3, Q4. Q3 even show figures and Q4 also. And which is the other one?

Sir, Banur-Kharar.

That also will likely to start in Q3.

Okay. Sir, but these orders were in our order book since Q1 last year. So it's the fifth quarter that we...

See, after only getting complete land and completion, then only appointed date will be given. So the appointed date after appointed date.

Got it. So sir, now the follow-up question is, are there any projects in the order book right now, which do not have that appointed date and which could see no execution for the next 4, 5 or maybe 2, 3 quarters?

2 to 3 quarters, there is only 1 building project of hospital of PPT, which may not see going ahead progress in the next 2 quarters.

Okay. Apart from that, all the projects that we have in the order book, they're all under execution, and they have all the land acquisition and appointed date.

Yes.

As there are no further questions from the participants, I now hand the conference over to Mr. Ashish Shah for closing comments.

Yes. On behalf of Centrum Broking, I'd like to thank all the participants for attending this call. And also a big thank you to the management for giving us the opportunity to host the call. Sir, any closing comments from your side?

We thank all the investors who have joined the call. And if you have any follow-up questions or the queries or inquiries, you can always connect with me or Stellar Advisory for further clarifications. Thank you.

Thank you. on behalf of Centrum Brokerage limited, that concludes the conference. Thank you for joining us, and you may now disconnect your lines.