Ceigall India Limited (CEIGALL) Earnings Call Transcript & Summary

Ladies and gentlemen, good day, and welcome to the Ceigall India Limited Q1 FY '27 Earnings Conference Call. [Operator Instructions] Please note that this conference is being recorded. I now hand the conference over to Mr. Smith Patel from Adfactors PR. Thank you, and over to you, sir.

Thank you. Good morning, everyone. Welcome to Q1 FY '27 Earnings Conference Call of Ceigall India Limited. Today, we have with us Mr. Ramneek Sehgal, Chairperson and Managing Director; Mr. Kapil Aggarwal, CFO; and Mr. Saravanan, Full Time Director. Before I hand over to opening comments, let me mention a cautionary statement that this conference may include forward-looking statements about the company, which are based on beliefs, opinions and expectations of the company as on the date of this call. These statements are not a guarantee of future performance and involve risks and uncertainties that are difficult to predict. We will begin the call with the opening remarks from the management, after which we will have forum open for a Q&A session. I now hand over the conference to Mr. Ramneek Sehgal for his opening remarks. Thank you, and over to you, sir.

Hi. Good morning, everyone, and thank you for joining us for the Ceigall India's Quarter 1 financial year earnings conference call. I hope all of you are doing well. Joining on today's call is Mr. Kapil Aggarwal, our CFO; Mr. A. Saravanan, our Whole Time Director, along with our Investor Relations team. Our financial results, investor presentation, press release have already been shared with the stock exchanges and are also available on our website. I hope all of you have had an opportunity to review them. the first quarter of financial year '27 may be another encouraging quarter for Ceigall. For the last few quarters, we have spoken about the strategy of building a diversified platform. We're continuing to strengthen our leadership in transportation, infrastructure, renewable energy, T&D sector. I'm happy to share that we have made a good progress on those priorities during the quarter, while continue to deliver healthy operational performance. or the most important development during the quarter was a successful monetization of the first hybrid an energy model or HAM asset through a divestment of Malodwari project. This is an important milestone for the company. as it validates the capital recycling strategy that we have been working towards over the last few years, our approach is very clear. We want to execute quality assets create value through efficient project delivery, monetize mature assets at the right stage, redeploy the capital into new opportunities. We believe this disciplined approach will support future growth while maintaining a strong balance sheet and improving overall capital efficiencies. Since our IPO, we have steadily diversified into the niche sector that address countries' evolving energy requirements while continuing to maintain steady growth in highway sector. We have expanded our presence in renewable needy space across solar, solar plus beds as well as transmission distribution. The diversification reflects our strategy of leveraging our strong execution capabilities to build a presence in high-growth sectors, create sustainability long-term value, during the quarter, we have signed a PPA for a solar bed at Marina, emerges L1 for 1 of the stand-alone battery projects. These developments further strengthen our confidence in the renewable energy platform that we have been building over the last year. Our execution momentum also remained healthy during the quarter. We have signed the concession agreement of [indiscernible] Subsequent to the quarter end, we received the quantitates of BRK 11, V12, Indore Greentree a project, enabling commencement of the execution. We also merged as L1 bidder in a joint venture on a highway project in Arunachal, these developments provide additional execution visibility further strengthen our product pipeline. Another aspect that gives us confidence in the continued evolution of our order book Today, our order book is not only robust in size but also much more diversified than it was a few years ago. In addition to highway and express ways, it's now include renewable energy, transmission and distribution industries infrastructure and other specialized institutional projects. The diversification allows us to participate in multiple growth opportunities while leasing dependent on a single segment of the infrastructure sector. Looking ahead, we continue to remain optimistic about the opportunities in renewable transportation and distribution sector, along with the interesting infrastructure projects. The government continued focus on energy, transmission distribution transportation, urban infrastructure, together with the strong execution capacities, diversified order book and disciplined approach towards a capital allocation gives us confidence in our ability to deliver sustainable growth over the long term. Before I conclude, I would like to thank our clients, business partners, lenders, shareholders, most importantly, our employees for their continuous trust and the spot. Their commitment has been instrumental in helping us gain these milestones. With that, I would now like to hand over the call to our CFO, Mr. Kapil Aggarwal, who will take you through the financial performance of the quarter in that video. Thank you. Over to you, Kapil.

Thank you, Ramneek, sir. The more and more you are joining us today. It is a pleasure to discuss our financial performance for the first quarter of FY '27. The first quarter is generally a seasonal softer quarter for the construction industry due to the onset of the monsoon in several parts of the country. Despite this, we delivered a healthy operation and financial performance, reflecting our disciplined execution capability and continued focus on operational efficiency. On a stand-alone basis, revenue from operations for Q1 FY '26 stood at INR 901 crores as against INR 818 crore in Q1 FY '26, registering a 10.2% year-on-year growth. Stand-alone EBITDA for the quarter stood at INR 121 crores as against [ INR 94 crores ] in the corresponding quarter of the previous year, with EBITDA margin improving to 13.4% from 11.4% in Q1 FY '26. Stand-alone profit after tax for Q1 FY '27 stood at INR 75 crores compared to INR 56 crores in the corresponding quarter last year resulting in a PAT margin of 8.4% as against 6.8% in Q1 FY '26. Moving to our consolidated financial performance. Revenue from operations for Q1 FY '27 stood at INR 970 crores as against INR 838 crores in the corresponding quarter of this year, registering a 15.7% growth in a year. On the operations side, our application engine continues to remain strong with 39 ongoing projects across multiple infrastructure segments, providing healthy execution visibility over the coming years. As on 30th June 2026, our order books stood at INR 18,568 crores providing strong multiple year revenue visibility. Today, our order book spans at 19 EPC projects and HAM projects, 1 DB4 project and 9 tariff rates, renewal and transmission projects. reflecting our continued diversification during rolls and highways into sectors such as renewable energy, transmission and distribution, metro rail and industrial infrastructure. I conclude my remarks and would like I would request the motor to open the profusion and answer session. Thank you, everyone.

[Operator Instructions] The first question comes from the line of Vaibhav Shah with JM Financial.

Yes. sir, first on solid projects. So we saw in Northern Iberia bypass, the execution fell significantly in Q1 to around INR 42 odd crores. Any particular reason for that?

Can you repeat your question, please?

In Northern Ayodhya bypass, the execution has fallen in Q1 to almost INR 42-odd crores. So any particular reason, any issues we are facing or something else on?

No, no. I mean, it is growing problem. There's nothing. Now from last 12 months has been in Otherwise, progress is steady. We've been achieving all our milestones before time. It's just sometimes you don't achieve the milestone payment can only be made only on the milestone is achieved.

Okay. Sir, what kind of execution are you facing from VRP 11 and 12 in FY '27?

We are targeting, we should at least do 20% to 25% of both the projects.

Okay. And same for Southern Ludhiana and Ayodhya?

So Southern Ayodhya, yes, it is there. On Ludhiana, the land is only 62% available with us. So that is a challenge. Otherwise, it is doable.

So for Ludhiana, we can do 25%, 30% in this year?

No, Ludhiana you should take at least 15% this year.

Okay, 15% land issue?

Yes.

Okay. And sir, any update on the Riva solar project? When do we expect to start? When will people...

So PPA signed, they have to provide us a transmission. So there were 3 things required for this project. One is PP, 1 is land and 1 is transmission. So they have projected the PPA, land is there. Third is the transmission line. I think we have already taken out the tenders for Tishonne. -- and we are expecting that to happen soon. Once that is there, we are ready to start. It's an easy project, why because you have to build everything in 1 location. Number two, for PM Kusum we've already started projects in Maharashtra and Madhya Pradesh, and those projects are progressing very well.

Okay. And sir, lastly, on equity requirement, what investments are we assuming in for HAM and Solar for FY '27 and FY '28?

So I'll give you a little brief. So at the time of our IPO, the equity we have put was INR 253 crores -- as on date, it INR 692 crores, where we have put INR 439 crores more. And this year, our balance equity commitment is INR 859 crores. And FY '28 is INR 744 crores.

So we will be putting INR 859 crores in FY '27.

Yes.

On the HAM and solar breakup.

INR 310 is solar and -- 296 INR 550 is highway.

And for FY' 28?

INR 300 crores for solar tentatively, [ 296. ] INR 444 crore -- yes.

[Operator Instructions] The next questions comes from the line of Krish with Anand Rathi Group. I'm sorry to interrupt, Kris you're not audible. Could you please use your phone on the handset mode in case on hand free.

So how much oil you expect to be awarded within this year and what...

Sorry, your voice is not clear.

The line for the participant has dropped. We move to the next participant. That is [ Mahesh Patel with ICICI Securities. ]

So my first question is on the margins. So we have posted good margins of more than -- around 13.5% this quarter against our guidance of around 1% to 1.5% for the full year. So what led to this improvement? And can we see similar margins in the upcoming quarters? Or was there any one-off this quarter?

Basically, we have started 3 new projects in this quarter, 2 are Marashtra Solosec, MH1 and MH2 and road projects and projection in low region. So basically, another 3 projects are about to start for which we already gave not at a funded rate in the first quarter of the July. Basically, it improves the numbers as well going forward in the future.

Okay. But we still maintain our guidance at 1% to 2.5%, right?

Can you repeat it once again?

I'm asking, are we still maintaining our guidance at 11% to 12.5% range?

Yes. We are going to maintain.

Okay. And sir, about order inflow, I think we guided for around INR 55 billion of order inflow for this year. We have done around -- in Q1?

We have guided our investors for INR 6,000 crores. We've already got close to INR 600 crores and rest is achievable during the year.

The next question comes from the line of [ Parth Thakkar with JM Financial. ]

Sir, I would like to ask when can we expect the 2 new projects?

So our FC date due for Bihar is, I think, next month. And the Baja project is close to November. So once -- I mean, we have already tied up with the bank. And once the FC is done, maximum 2 or 3 months after that, we should start to work.

So you can extend the AD for both by 4Q?

So yes, fourth quarter, we should expect a -- I mean, we have -- we can expect by third quarter. Otherwise, in fourth quarter, definitely, we'll get the ADs of the project.