Capacit'e Infraprojects Limited (CAPACITE) Earnings Call Transcript & Summary

Ladies and gentlemen, good day, and welcome to the Capacit'e Infraprojects Limited Q4 and FY '25 Earnings Conference Call. [Operator Instructions] Before we begin, a brief disclaimer. The presentation which Capacit'e Infraprojects Limited has uploaded on the stock exchange and their website, including the discussion during this call contains some forward-looking statements concerning Capacit'e Infraprojects Limited business prospects and profitability, which are subject to several risks and uncertainties, and the actual results could materially differ from those in such forward-looking statements. Please note that this conference is being recorded. I now hand the conference over to Mr. Rohit Katyal, Executive Chairman from Capacit'e Infraprojects Limited. Thank you, and over to you, Mr. Katyal.

Good morning, everyone. On behalf of Capacit'e, I welcome everyone to the Q4 and FY '25 Earnings Conference Call of the company. Joining me on this call is Mr. Rajesh Das, CFO; Alok Mehrotra, ED, Finance; and Marathon Capital, our IR team. I hope everyone has had an opportunity to look at our results. The presentation and press release have been uploaded on the stock exchanges and our company's website. FY '25 results were historic both in terms of total income and PAT. This success is a direct result of our prudent financial management and dedication to maintaining a healthy balance sheet, positioning us for continued growth and deliver long-term value creation. Our careful project selection alongside our execution strength has resulted in surpassing our highest ever yearly PAT in FY '25 at INR 204 crores and setting new performance benchmark. We anticipate further acceleration in execution and operational improvements. We have set Vision 2028, where we have targeted revenue growth of 25% year-on-year, maintaining healthy EBITDA margins and improving on working capital. On the order book front, we have seen significant traction, both from private and public sector. The bidding activity has seen a significant uptick, which should translate in order awarding sooner. We have been awarded projects worth INR 2,823 crores during the fiscal 2025. We have entered a high-growth phase, supported by a diversified order book from esteemed clients across public and private sectors. Before we begin on performance update, we would like to highlight that starting Q4 onwards, the company has made a policy of not recognizing profits on the projects until 10% of the contract is executed. So the project revenue for certain projects like NBCC, Maldives and Signature Global have only been recognized and cost and no profit has been accrued. Before we begin on the performance update, as far as increase in the other income is concerned, there has been a write-back of INR 20 crores in bad debts along with interest, which generally should have been netted off from expenses. But as per accounting policy, it needs to be shown in other income, thereby impacting the EBITDA for the quarter by close to 2% and for the year by close to 1%. Consolidated performance for FY '25. The total income for FY '25 stood at INR 2,407 crores, up by 23% as compared to INR 1,964 crores in FY '24. EBITDA for FY '25 stood at INR 437 crores, up by 20% as compared to INR 363 crores in FY '24. EBITDA margin for FY '25 stood at 18.2% as compared to 18.5% in FY '24. EBIT for FY '25 stood at INR 342 crores, up by 30% as compared to INR 262 crores in FY '24. EBIT margin for the last year stood at 12.6% as compared to 13.3% for FY '24. PAT for FY '25 stood at INR 204 crores, up by 69% as compared to INR 120 crores in FY '24. PAT. PAT margin for FY '25 stood at 8.5% as compared to 6.1% in FY '24. I now turn to the consolidated performance highlights for Q4 FY '25. Total income for Q4 FY '25 stood at INR 705 crores, up by 16% as compared to INR 609 crores in Q4 FY '24. EBITDA for Q4 FY '25 stood at INR 119 crores, down by 1% as compared to INR 121 crores in Q4 FY '24. EBITDA margin for reasons explained earlier for Q4 FY '25 stood at 16.9% as compared to 19.8% in Q4 FY '24. EBIT for Q4 FY '25 stood at INR 93.4 crores, down by 5% as compared to INR 98.6 crores in Q4 FY '24. EBIT margin for Q4 FY '25 stood at 13.3% as compared to 16.2% in Q4 FY '24. PAT for Q4 FY '25 stood at INR 53.1 crores, up by 2% as compared to INR 51.8 crores in Q4 FY '24. PAT margin for Q4 FY '25 came at 7.5% as compared to 8.5% in Q4 FY '24. We booked orders worth INR 2,823 crores in FY '25. Order book on stand-alone basis stood at INR 10,545 crores as on 31st March 2025, with public sector accounting for 68%, while private sector accounting for 32% of the total order book. I now leave the floor open for questions.

[Operator Instructions] The first question is from the line of Nirvana Laha from Badrinath Holdings.

Congrats on a great year. Sir, my first question is in the other income for this quarter, INR 36 crores, can you provide a breakup of the absolute...

So the other income...

Sir, just to complete. And last quarter, you had said that other income also had contributions from trading. So is there a similar amount this quarter also if these two numbers you can call out?

No. The majority of the income is from the write-back of bad debts, which is INR 6.62 crores and interest thereon of INR 5.78 crores. So when the settlement is done and payment received, it was received, including interest. This amounts to close to INR 12 crores, which in other words, means about 1.8% impact on the EBITDA. So as per accounting policy, we have to cover this write-back under other income.

Sure. So that leaves about INR 24 crores other income for this quarter. So what would that be contributed by?

So that would -- so it comprises of sales of scrap. It comprises of interest from fixed deposits because the finance cost is not netted off. It is shown in other income. And it includes -- provides for excess provisions for earlier years.

You mean reversal of excess provisions?

Reversal of excess provisions, absolutely. So...

How much would that be, sir?

INR 24.08 crores in totality.

For the financial year?

Yes.

Okay. Okay. Sir, my question is you've always asked us to look at EBITDA margin, taking other income into consideration. So if we take this INR 36 crores into consideration, the margins are looking okay. But I'm compelled to also look at the operating EBITDA number, which has now for the last two quarters, it has slipped. Last quarter, you said there was some GST onetime hit that we had taken. But this quarter, the number has slipped even more. So would you like to comment on this? How do you see this number going ahead? I'm not talking about the other income part. I'm just talking about the operating...

You see that the other income also basically is a write-back from what we lost in operations. That time, it took the hit on the P&L. Now when it is coming back to the company, it is coming back under other income. So therefore, we have always propagated that we look at EBITDA, including the other income. All right. However, if you say that in my commentary, I first mentioned that the company has stopped recognizing profit till 10% of the contract value for new projects, which started in Q4 of last fiscal is completed. This includes NBCC. This includes Signature Global and this includes Maldives project. The total income recognized on these three projects alone is close to INR 95 crores in Q4 of last fiscal, all right? And no profit has been recognized in this. This is simply being done because the quantum of EPC projects of large value is continuously increasing in the company's order book. So it's only prudent that for entire design build projects, the profit is only recognized once 10% of the contract is completed. At the moment, for these three projects, no profitability has been recognized in Q4 of last fiscal.

Understand. So sir, you're saying that revenue is recognized, costs are recognized, but the profit is not recognized. Am I understanding is right?

Absolutely.

Okay. And sir, you did talk about it, but any specific reason why from this specific Q4, we decided that this was the right time to do it? Like were you tracking any metric or any particular thing?

Yes. So our now, with the receipt of order from NBCC, the total operational order book, including CIDCO, including MHADA BDD, including the balance work to be done in JJ, the quantum of pure EPC design-build projects has gone up substantially, all right? And until unless the entire design is approved, it is not prudent to recognize any profit. And design approval does take in totality, 3 to 4 months. And I believe that all these being short-term contracts between 24 to 30 months, there will be substantial revenue recognition as certified by the client in the first 4, 5 months. So it's a question that it is only a matter of 4, 5 months on a recurring basis and the profitability will start to be recognized. And that would basically be a more prudent profitability because once design is freezed and approved by maybe [ IIT or VJTI ] or any approving authority, then the BoQs or bill of quantities are more perfect. And therefore, the chances of profitability getting impacted at a later date are virtually removed. Therefore, this decision to take. There are companies who are following 20%. There are companies who are following 15%, and there are companies who are following 5%. We believe that with the nature of the business we are in, 10% is good enough time to get the entire design approved and certified by the client.

Okay. Understood, sir. So going forward, once this becomes normal practice for us, going forward, in how many quarters do you expect the EBITDA margin to recover to your earlier guided range?

You see, we have always maintained a guidance of close to 17% to 17.5% for the full year basis. We continue to do better. Now one particular quarter, 19% happening and that being pulled up, that's not the right way to see. For the full year, we have crossed 18.15% on a consolidated basis. On a stand-alone basis, we have done at 19%. And we do believe that we should be for the full year close to this mark. But the guidance continues to be 17% to 17.5%. Anything above that should be taken as a bonus.

Sure, sir. Sir, one question on working capital. We've been discussing this through all the calls, and this has been a prominent topic of discussion. So you had guided that this year, we would look to shave off 15, 20 days from the working capital days. So that has not happened. And the trade receivables has actually -- it has increased quite a lot. I understand there can be some timing issues at the end of the Q4. But if you would like to comment on this, like the reduction plans and why it did not.

Absolutely.

Yes. And the spike in this receivables, it has doubled now from INR 548 crores to INR 1,080 crores. So how do we see that?

So there is a -- that's a positive when the -- there is a movement from contract assets WIP to debtors. That means the debtors are being recognized and the receivables will start pouring in. So receivables for -- in April towards the last quarter outstanding, collection was close to INR 240 crores, which is one of the highest collections over the last couple of quarters. This trend will continue because the positive movement after now 8 quarters, what you are seeing is the movement from WIP under contract assets to debtors, both certified and uncertified. So we believe that over the next 3 quarters, the debtors at absolute level will fall. The WIP will remain at constant level, thereby making a substantial improvement in working capital days. So the movement should be viewed positively from WIP towards debt.

Sure. And the reduction in working capital is not happening? And how do we see that going forward?

Just as I told you that the debtor collection has gathered momentum from April onwards. The collection was at a 2, 3 quarter high in April as a month collection. We believe that the current quarter collection also will be substantially good. So we do believe that this absolute figure of INR 1,000 crores in debtors, the spike which you have seen will get corrected over the next 2 to 3 quarters. And a correction of INR 200 crores to INR 250 crores will therefore translate into a number of days, number of days, which you are mentioning.

Sure, sir. And you expect contract assets to remain flat from here on?

If we are going to do about INR 2,700 crores of revenue in the current fiscal as a target, then obviously, we will ensure no increase or maybe slight reduction. But obviously, you will have to maintain about INR 900 crores of contract assets, which include work done, not build, WIP design charges to be taken at a later date, 3% of collection happening on handover of the particular building, so on and so forth.

Sure, sir. And last question, if I may, reacting to what you just said. So now you're saying that next year, we'll do about INR 2,700 crores, which is about a 15% growth on FY '25. Sir, this is significantly lower than the guidance that you've maintained throughout of 20%, 25% growth. So is there anything to read into this? Are you lowering the guidance for next year?

No, no. I just gave you an example, sir. The guidance remains at 25%, all right. Now whether you take it as other -- including other income or you take it excluding other income, -- so the guidance is 25%. I just told you, if your revenue is INR 2,700 crores, then the WIP under contract assets will have to be maintained at INR 850 crores to INR 950 crores.

[Operator Instructions] The next question is from the line of Rishi Kothari from PI Square Investments.

Sir, however, I have a doubt in the accounting policy that we have made a big changes. So we are saying that 10% of the project contain is recognized, we will not have any impact on our P&L in terms of the project we have comped -- so how exactly is it?

This accounting policy are for the projects which commenced in quarter 4 of the last fiscal and whatever projects will commence in the current fiscal and going forward. So as a matter, as I explained in the last question also, when the company executes the project, 4 months, 5 months down the line, when INR 1,000 crore project is being executed with all technicality between 4 to 5 months, 10% of the contract amount is billed. Thereafter, the profitability is accrued or recognized. This impact will only be for the first 2 quarters. Thereafter, what was not recognized in quarter 4 of last fiscal will start getting recognized in quarter 2 of the current fiscal. So it is practically not a very big aspect. It's only a prudence to ensure that until unless the design is totally approved and the bill of quantities is established and the profitability is firmed up, the profitability should not be recognized in the books.

So I'll recognize the top line right for that project and a bit of expenses that has been incurred to do that project. So apart from that, what exactly will not be recognized at least for this Q4, but for next Q2 FY '26?

So as a percentage completion, when you incur a cost of, let us say, INR 100 and your site contribution is or profit margin on gross is 15%, the sale automatically becomes INR 115. This 15% will not be recognized, only the cost actual incurred and the actual billing done will be recognized.

Sorry to interrupt, sir, I would request to rejoin queue. The next question is from the line of Parvez Qazi from Nuvama Group.

So I wanted to get an update on three of our projects, which is MHADA, CIDCO and Signature Global.

So MHADA project work on now 16 buildings of rehab are going on. Another 6 buildings, the work will start from June end. So that will make it 22 buildings out of the total 33 buildings. The first set of 2 buildings are being delivered for inauguration by 10th of June. That is 10 days from -- 12 days from now. We have received a go-ahead to start construction on the sale residential towers of 90 stories each, 6 towers. The IOA is expected in the next 15 days for these 6 buildings which means our billing for the sale towers will start from this quarter itself, that is from June and thereafter over the next remaining year. That is as far as MHADA is concerned. The only pending in MHADA would be the commercial building, which ideally the client would give a go ahead maybe in the current financial year sometime. That's point number one. Point number two, CIDCO project, work is going on in full swing with enhanced revenues happening across the six locations. The first two locations are being delivered to CIDCO in July of the current financial year. The remaining four locations will be delivered starting December to October '26. So that's an approximate guideline, give or take away a couple of months or a quarter. But these are is the status of CIDCO. Location #7 has been reidentified as Sector 43. Out of the 360 tenements, which the client had to remove, 302 have been removed. The balance is under process. So ideally, I would see that location #7 also coming to the company sometime by Q2 of the current fiscal. What was the third one? Signature Global. Signature Global, the phase -- the project of INR 1,200 crores or thereabouts is split into two phases, Phase 1, Phase 2. Phase 1, the work has already started in the current quarter -- sorry, last quarter. We recognized a small revenue of about INR 5.oint-odd crores in the last quarter. The work is going on in the current quarter as well. Phase 2, the client has given an indication that will be made available by end of quarter 2. So you will see a ramped up revenue of above INR 20 crores to INR 25 crores from quarter 3 for this project. This is a shell and core project, just to clarify.

The next question is from the line of Dhananjay Mishra from Sunidhi Securities and Finance Limited.

So you said that in Signature Global, NBCC and this MHADA project, all put together, we have recognized close to INR 80 crores revenue and cost as well, right?

Yes. To be precise, about INR 21 crores in MHADA, INR 56 crores -- sorry, INR 21 crores in NBCC, I stand corrected, INR 54 crores in Maldives and something remainder in Signature Global.

But sir, Maldives is under JV, so it will come through line item revenue and EBITDA and PAT or it will directly profit will be added in the P&L?

Line item, we are the majority shareholders.

Okay. Okay. And when do you expect to reach 10% threshold level to book -- start booking margins -- profit margins in these projects?

In Maldives from the current quarter from -- for NBCC from quarter 2 and onwards, and even for -- because there are two phases in Signature Global, for Phase 1, we should start recognizing profit from quarter 2 and Phase 2, we will start recognizing profit from quarter 4.

Okay. And what is the outstanding order inflow -- sorry, order book in CIDCO? Anyway, we are expecting to complete entire 4 sites in the next 18 to 20 months. So what is the outstanding portion over there?

Location # 126 is INR 2,600 crores. We have built about INR 1,100 crores. Submitted bills are close to INR 200 crores. Balance revenue to be booked over there is close to INR 1,300 crores to INR 1,350 crores to be recognized over the next 18 months' time.

The next question is from the line of Pradyumna Laddha from RSPN Ventures.

I just wanted to check in, I read somewhere in the press release that we've decided to change our stat auditor starting this year. Just want to get your thoughts behind the rationale, if there is any.

There's no rationale. We are required under law to change the stat auditor after 10 years. We have -- we are thankful to EY Associate for having supported the organization and guided us for the last 10 years. And that's the only reason. There's no other reason.

The next question is from the line of Tejas Khandelwal from Prudent Equity.

Yes. So sir, construction expense in Q4 came as INR 236 crores. So it is 50% increase year-on-year and 35% increase quarter-on-quarter, but revenue has not grown at that pace. So I just wanted to know the reason. Is it that you have not recognized the NBCC, Signature Global and Maldives revenue or something else?

Absolutely. You have answered the question.

Okay. So what I did not understand, sir, that this -- the projects which are not 10% -- which are not executed at least 10%, you are going to recognize revenue and you are going to recognize cost, but you are not going to recognize profit, am I right?

Up to 10%. So as I just explained in my previous answer, we will start recognizing profit from Maldives from this quarter. We will start recognizing profit from June -- that is -- sorry, from quarter 2 of the current fiscal for NBCC. We will start recognizing profit for Phase 1 of Signature Global by quarter 2 and Phase 2 by quarter 4 of the current fiscal. So this will now be a continuing thing. So you will see a blip. However, the guidance for the full year as far as EBIT, EBITDA, PAT is concerned is for the full year, and that will continue as we have showcased for the full year in the current year as well. Our guidance always has been 17% to 17.5%. For the full year on a consol basis, we are at 18.5%, and the guidance does not change.

Sir, this 18% -- 17.5%, 18% margin, this is including other income, right?

Yes, yes. That has been followed continuously for the last 2, 3 years, always.

Okay. So you are expecting this INR 20 crores, INR 30 crores other income run rate for next couple of quarters?

Sir, this is going to be coming majorly as a write-back. So the company has to receive the very old receivables where it has won legal matters and so on and so forth, as explained during my prior calls as well. Out of that, quarter 2 has -- quarter 4 for last fiscal has been nice. We expect that to continue, but I cannot give a pinpoint because these are legal matters, something will happen in quarter 1, maybe more will happen in quarter 2 and maximum could peak in quarter 3. But yes, as a ballpark figure, as I told you, that the company had to receive close to INR 200 crores from old receivables and the journey has begun in the right ear.

Okay, sir. Understood. And sir, in your investor presentation, you have guided for 20% CAGR revenue growth till FY '28. So what about FY '26, you are guiding 20% or 25%.

As I told you, that one is a minimum commitment. Everything else is a bonus. We have done 24% in the last financial year. And we do not see any reason why that should not be done in the current financial year. The momentum is there. The projects are going on across the portfolio. There is no stoppage on that. We don't see any elections in the current financial year. Obviously, the challenge will come from workmen and lack of qualified workmen, trained workmen in the country, which is an industry issue, and we all are finding ways to resolve that. So answering your question, the growth has been delivered over the last 2 years, and it will continue for the foreseeable future in the manner what we have given. Obviously, the PAT levels have risen significantly. It is only a result of fixed cost savings. The interest has also on an absolute basis has been stagnant. Therefore, as a percentage to top line has fallen. And therefore, you see a significant increase in the PAT percentage for the full year. So this phenomenon obviously will taper down. You cannot go and say that I'm going to make a 12% profit from a higher base level of 8.15% or thereabouts. But yes, on an absolute basis, the company will grow and grow very strongly.

Okay, sir. Understood. So you are saying INR 2,900 crores is achievable, right, in FY '26?

[indiscernible] could be less, but I've given everything to you. I mean, it's your guess now.

[Operator Instructions] The next question is from the line of Anupam Gupta from IIFL Securities.

So working capital, you highlighted the key changes which are there from contract assets to receivables. But let's say, what do you expect in terms of recoveries in this year? And hence, what can be your potential reduction in debt, which has increased in this year because of working capital and growth. But broadly, let's say, if we were to look out to FY '26 with 25% earnings revenue growth and some potential reductions in receivables, what's the sort of debt levels you are looking at by the end of the year?

So the debt level historically has been INR 335 crores. That is where we would ideally like us to see. There is a temporary blip of increase because of new projects starting. However, out of that INR 10 crores repayment has already happened on a net basis in April and May. And these repayments will continue. So we do look that by the end of the year, we should be again on gross level of INR 334 crores, but the net level will substantially fall because we carry approximately INR 65 crores to INR 90 crores of free cash on our books. So on a net basis, if your debt level is close to INR 195 crores today, we ideally would like to see that at about INR 120 crores to INR 125 crores.

Sure, sir. Okay. And what's the position on the fund and nonfund-based limits? Is that enough available for the growth which you're talking about for FY '26, '27.

So for the current financial year, State Bank of India has already assessed us. And we are -- while we have INR 150 crores of unutilized BG limits available with us and LC limits, commensurating with the requirement what we have, we do believe that INR 260 crores of further limits will get tied up over the next 1 quarter. We don't see any challenge on that. And with the results out, obviously, we'll be approaching for the rating agencies as well to -- so that the finance costs can be reduced. What is interesting is after having gone into the investment grade, all the banks have reduced the rate of interest. And the rate of interest is not very interesting. What is important is that they have reduced the commissions on the bank guarantee and the full impact will be visible from quarter 2 of the current financial year, hopefully.

Okay. So ideally your finance cost should be stagnant or lower in FY '26, right?

That's what you have seen in FY '25.

Yes, yes. Okay. And just one last question on your order inflow target. So order book obviously has been healthy. FY '26, what sort of inflows you're targeting? And if you want to have any mix which you want to highlight?

So the mix will continue to what it is. We will be focusing on industrial projects as well, more of commercial, more of health care, limited residential because you know that residential projects are very labor intensive. And we all know that there is paucity of labor across. It's not with us, it's everywhere. So therefore, the mix of the projects will be very, very important going forward. More so, when you get into the industrial projects, you are aware that the completion periods also shrink substantially. While the revenue will obviously go up, but then we will have to be very careful on the number of projects we take on. I have earlier also mentioned the management is comfortable in managing 35 projects, which give minimum revenue of INR 10 crores or more to the company per month. And therefore, we have told you this guidance of 20% to 22% year-on-year. Answering your question, the order intake -- committed order intake for the current financial year will be INR 3,500 crores. Our internal targets will be higher. That can be left to another day once we cross this INR 3,500.

The next question is from the line of Rajesh Jain from RK Capital.

Sir, I did not understand one answer, even though you have already answered it twice. So I'm just trying to rephrase and get a different answer from you. So if you have not changed your accounting policy and if you -- so what I understand is that you had booked your cost, but probably not your revenue. And so if you had booked the revenue and if you had not changed the accounting policy, then what would have been the EBITDA?

The EBITDA would have been more by INR 12 crores.

More by INR 12 crores.

INR 12 crores. 2%.

Okay. So you have booked the cost, but not the revenue? Or did you say you have booked both the cost and the revenue? I didn't understand that.

We have booked the cost. We have booked the cost and the revenue is equal to the cost. We have not put the margin as required under the input method to recognize profit, and this will be done only once 10% of the contract value is completed.

Okay. Understood, sir. So...

You have seen that we have recognized INR 16 crores profit from our joint venture with Tata Projects in the current financial year. We did not recognize this profit for 3 years because in that JV also, the recognition will happen only after 10%. Now since 10% of the contract over there in the rehab portion has been completed, you see a profitability accruing to capacity of INR 16.8 crores in the last fiscal.

Okay, sir. Okay. Understood. And my second question is, today, out of your total projects, how many projects are not operational? And how many projects are facing delays?

All are operational, no legacy contract. All old projects have been completed. All the new projects, we just spoke about most of them. Mumbai, MMR, Delhi NCR are the main markets and all the projects are operational, except the INR 2,000 crores of location #7, once that is received, it will become operational.

Okay. So out of INR 10,500 plus crores, only about INR 2,000 crores is not operational apart from that, everything is operational.

Yes. But at the same time, you have to understand that we have recognized -- we have yet to recognize INR 3,000 crores of MHADA order book in our order book. We only have recognized what is operational. So once more land is made available to the company, the order book inherently will stand increase by another INR 3,500 crores.

Okay. And are you facing any delays in any of the projects? You said no, right? There is no delays in any of the projects?

So there is no meaningful material change or delay in any project. The company is executing the projects as they ought to be executed.

The next question is from the line of Darshil Jhaveri from Crown Capital.

Sir, a lot of my questions have already been answered. So I just wanted to know any kind of -- what are the CapEx that you're planning to do this year, sir?

What are the...?

CapEx.

CapEx.

So we had restricted our CapEx last year to under INR 60 crores, I believe. And we would like to see a similar number in the current financial year, could be higher by about INR 15 crores, INR 20 crores. But yes, there will be an increase in the temporary structures because of sizable projects being added in the quarter 4 of last fiscal. site establishment is temporary structures, which are written off or amortized over the project life cycle up till 85% of the project.

Okay. Okay. So we might see a slight uptick in depreciation if that could be construed, right? Like so you know like a Q4 run rate is around INR 26 crores. So we should have maybe a slightly higher if there are more temporary structures. Is that a fair assumption?

A fair assumption would be that there will be about INR 140 crores in temporary structures. And there will be approximately INR 55 crores to INR 60 crores in CapEx. Temporary structures will be accelerated depreciation as amortized over the period of project execution period. For income tax, it will carry a 40% depreciation.

Okay. Okay. Fair enough, sir. And just last one bookkeeping question. Our tax rate will remain at 25%, right, sir? Our tax rate? What will be our effective tax rate, sir?

Yes, yes.

The next question is from the line of Mukul Verma from Varma Associates.

I just wanted to know a few quarters back, we were L1 in one of the government projects to the extent of INR 600 crores, INR 700 crores. So has that -- so where is that project lying? And is it still not kind of...

So that project still has not been -- is the cold story, let me put it that way. There has been a change in the government. And fortunately, or unfortunately, you may put the government of Maharashtra is trying to correct its finances. We believe that they are in for certain big grants from central government. Once that happens, the project will be awarded. Having said that, the company's order inflow has not suffered because of that order not coming in. But yes, the company is very keen on data centers. We'll continue to bid in that space, and we hope to give you some good news sooner than later.

And one more question, sir. Anything we are looking at...

Sorry?

Sorry to interrupt you, sir...

Anything we are looking at in Andhra Pradesh where this Amaravati.

Yes, we have submitted our documents. I believe that our qualification should happen very soon. However, we will -- as the company policy, we will look at a smaller project to start with. However, any small project over there would be INR 700 crores, INR 800 crores because it's lock and key. There are many iconic towers, which have been planned over there. And we being one of the frontrunners in the country as far as super high rises and iconic towers are concerned, we will definitely have our opportunity.

As there are no further questions from the participants, I would now like to hand the conference over to Mr. Rohit Katyal for closing comments.

I would like to thank all of you once again for joining us on this call today. We hope we have been able to answer your queries. Please feel free to reach out to our IR team for any clarifications or feedback. Thank you until the next time we meet again.

Thank you. On behalf of Capacit'e Infraprojects Limited, that concludes this conference. Thank you for joining us, and you may now disconnect your lines.