Dilip Buildcon Limited ($DBL)

Ladies and gentlemen, good day, and welcome to the Dilip Buildcon Limited Q4 FY '26 Earnings Conference Call. [Operator Instructions] I now hand the conference over to Mr. Ashith Salian from Adfactors PR. Thank you, and over to you, sir.

Thank you. Good evening, everyone, and thank you for joining us today to discuss the audited financial performance for Q4 and FY '26. I have with me Mr. Devendra Jain, MD and CEO; Mr. Rohan Suryavanshi, Head, Strategy and Planning; Mr. Sanjay Bansal, the CFO.

Before we proceed, I would like to bring to your attention that certain statements made during this discussion may constitute forward-looking statements. These statements are based on our current expectations, assumptions and beliefs regarding future developments and are inherently subject to various risks, uncertainties and factors beyond our control. Such forward-looking statements involve both known and unknown risks, and we advise you to interpret them with caution. I will now hand over the call to Mr. Rohan Suryavanshi for his opening remarks. Thank you, and over to you, sir.

Thank you, and good evening, everyone. On behalf of the whole DBL family, I extend a warm welcome to all our investors and analysts to our quarter 4 FY '26 earnings conference call. The financial results and investor presentation for the quarter have already been uploaded on the stock exchanges, and we trust that all of you had the opportunity to go through them. I'm very pleased to inform that all our partners that this time we prepared a new presentation format, which simplifies how one should look at our company, given the new direction that we have embarked on. It talks about our past, our current status and where we are intending to go into the future. It divides the company in 3 verticals: EPC, the MDO vertical and the assets vertical. Now all these 3 verticals have different roles. The EPC vertical is going to be the one building all the assets, while the MDO and the asset business will continue to give us long-term revenue visibility and profitability. The reason why we have moved in this direction, I have already inundated in the earlier calls. However, it is very important for me to point out right now that this strategic direction is very important for everyone to kind of pay attention to closely because by FY '29 we anticipate 3/4 of our profits to be coming from long-term assets and only 1/4 to be coming from our EPC business. That is the scale of ramp-up that will happen in our asset business and the cash flows and profitability that it will provide. Along with taking a lion's share in the profitability, it also is going to give us the visibility of the next 15 to 50 years of cash flow visibility. As you're all aware, the EPC business only gives a visibility of 2, 3 years. So having said that, let me now give you highlights on the broader sector environment, before which I talk about the DBL's performance. The infrastructure sector continues to offer strong long-term opportunities, supported by a sustained government focus on roads, railways and other sectors that we're currently involved in. Now during FY '26, the average monthly tendering activity for the overall infrastructure sector by national and state governments put together remained healthy at INR 1.4 trillion. However, this awarding activity was little sluggish in terms of the initial FY '26 target that the government has set. This was obviously on account of various state elections, regulatory scrutiny and other administrative delays. But we remain optimistic about the sector in the midterm and the long term, given the government's continued focus on building assets across the infrastructure vertical. With all that positivity, there is also certain near-term challenges. The ongoing geopolitical conflict and the elevated crude oil prices have led to inflationary pressures across fuel, bitumen transportation and other key raw material costs impacting margins across the infrastructure industry. And in addition to this, the competitive intensity and bidding remains high in certain segments. While delays in project approvals, land acquisition and receivable cycles continue to impact execution time lines. However, despite these challenges, we believe the industry is gradually moving towards a more disciplined and execution-led growth cycle. In this backdrop, we continue to focus on selective tendering by prioritizing high-quality projects with better margin visibility, balanced risk/reward and strong counterparties rather than pursuing scale only. We remain focused on maintaining execution, discipline, strengthening operational efficiencies and preserving balance sheet strength, which we believe will help us navigate near-term volatility while positioning the company to benefit from long-term infrastructure opportunities in India. Now coming to DBL's business performance. Our performance this year must be viewed through the lens of the DBL 2.0 philosophy, which we have shared earlier and spoken about in the presentation. We have consistently communicated that our approach to order booking is selective. We are prioritizing profitability, cash flow visibility and return ratios over pure top line growth. Increasingly, we view our EPC business not just as a volume-driven profit center, but as a capital-efficient execution and incubation engine. This engine allows us to create long duration, monetizable platforms across diversified asset classes. I'm also very happy to report that for the FY '26, DBL has secured total order inflows of INR 18,548 crores, which is much higher than our original guided figure. We had also communicated this that we have exceeded that full year order inflow guidance earlier. But quarter 4 '26 has further added to it. Our order book today remains among the most diversified in the industry, providing strong visibility across multiple infrastructure segments without relying on any single one. Our current bid pipeline stands at INR 80,000 crores plus across sectors. With optimum utilization of existing assets and a disciplined approach towards capital expenditure, the company continues to enhance capital efficiency and deliver improved return on investments. Now turning on to our mining vertical, which is increasingly becoming an important driver of DBL's long-term earnings visibility and cash flow generation. Our coal MD operations have continued to scale up steadily during FY '26, beating our own targets in terms of production and helping diversify a larger part of business away from the cyclicality of a traditional EPC business. At the Pachhwara -- at the Siarmal mine, quarter 4 production stood at 7.24 crore tonnes and cumulatively FY '26 production stood at 22.35 crore tonnes, achieving full year production target. Similarly, the Pachhwara coal mine continued its gradual ramp-up with FY '26 production closing at 6.37 million metric tons. So on a consolidated basis, DBL coal production for FY '26 stands at 28.72 million metric tons. Now we remain committed to achieving our annual coal production of around 57 million metric tons by FY '29, which at its full capacity would represent a significant part of India's total coal output and positioning DBL as a critical partner in the nation's energy security. As production scales up further, mining is expected to contribute meaningfully to the company's EBITDA generation and overall cash flow strength. Our InvIT strategy continues to progress in line with the road map we had outlined earlier. Following the successful listing of Anantam Highways InvIT, we currently hold about INR 1,400 crores worth of units in the Anantam Highways and around INR 200 crores in the Shrem InvIT, taking the total value of InvIT units on our balance sheet to nearly INR 1,600 crores. Now this has created a long-term platform for predictable distributions and structured deleveraging for the company. We also remain on track to transfer the remaining HAM assets in phases through March 2027. The next tranche of 11 assets is expected to require less than INR 200 crores of incremental investment while generating InvIT units valued at around INR 1,800 crores, implying a net equity value creation of INR 1,500 crores to INR 1,600 crores. Now while I'm explaining these other sectors, I also want to take this opportunity to debunk some commonly held perceptions about the company, which we have also highlighted in the presentation. The first perception is that we have made significant revenues from our home state throughout our history of the past 2 decades. However, the data suggests otherwise, you would all be surprised to know that in the last 20 years, only 10% of the total revenue that we have made has come from the state government of MP, while 90% has come from national government and other states. Now this is a very big important perception that I'm trying to correct that we have been working mostly outside our home state rather than in our own state. Similarly, there has been a perception about our debt that has lingered since many years. And even though in the past, our debt might have been higher than our peer groups as we were in a CapEx cycle and in a growing stage, our debt position today is very comfortable. And besides that, we have significant assets against it, which was not the case in the past. Now coming to our debt position. Outstanding debt as of March 31, 2026 stood at approximately INR 1,800 crores at the stand-alone level and INR 7,082 crores at the consol level. Now the consol obviously is because we keep building these new assets, and it's a temporary phenomenon where as soon as we build the SPV and those are completed, we either sell them or we're going to put them into our InvIT. So it's a temporary 2-, 3-year thing that we are going to do. And it is -- all the revenues -- future revenues of those assets are tagged against that. So it's a very safe investment from that perspective. Now against our stand-alone debt of INR 1,880 crores today, we hold nearly INR 1,600 crores of InvIT units on the balance sheet. Had we chosen to sell all these units, our net debt would have been roughly INR 300 crores or so. But because we decided that we wanted to build a platform where we have cash flows coming in for the next 15, 20 years, we have decided to retain them as we realize we are in a very comfortable position going forward, and we have a very good order book as well. Besides these InvIT units, let me also point out 2 assets that we already have. We also have about INR 1,000 crores plus invested in under construction projects, which will soon get transferred into the InvIT and generate additional InvIT units of, like I mentioned, INR 1,800 crores. Similarly, we also have a gross block of little less about INR 3,600 crores on our balance sheet, which translates into about an INR 800 crores of net block. Now these assets are all debt free. These are all equipment that the company uses, and we have no debt against it. So -- while our only working capital debt is shown, we have significant assets against all our debt. And more than this, as we have already said, our agenda is to be a net debt-free balance sheet by the FY '28. We are very confident of this because of the continued cash generation from our EPC operations, our MDO operations and the growing income from our InvIT holdings. So it's a clear pathway that we see. So overall, FY '26, while it was a relatively challenging year for the infrastructure sector, we believe it also marks an important transition towards a more disciplined and execution-oriented industry environment. Dilip Buildcon with its diversified order book, our steadily scaling mining operations and a well-defined InvIT monetization platform, along with continued focus on capital efficiency, we are structurally positioned much better than before. And as we move ahead, our focus remains firmly on disciplined growth, execution excellence, balance sheet strengthening and sustainable cash flow generation. Now supported by the long-term infrastructure opportunities in India and improving contribution from our own stable cash-generating businesses, we remain confident in our ability to create sustainable long-term value for all our stakeholders. Now with that, I would like to hand over the call to our CFO, Mr. Sanjay Bansal who would like to take you through the financial performance for the quarter in greater detail. Thank you.

Thank you, Rohan ji. Good evening to all. I will now briefly take you through the key highlights and financial performance for the quarter and full year ended 31st March 2026. During FY '26, the company aided projects worth INR 18,548 crores and completed projects worth INR 2,812 crores. As a result, the company continues to maintain a healthy and diversified order book with strong execution visibility across multiple infrastructure segments. On a stand-alone basis, the revenue for FY '26 stood at INR 7,005 crores as compared to INR 9,004 crores in FY '25, reflecting a Y-o-Y change of approximately 22.2% negative. EBITDA for the year stood at INR 734 crores against INR 903 crores in the previous year, representing a Y-o-Y change of negative 18.72%, while the profit after tax stood at INR 841 crores as against INR 311 crores in FY '25. Now on consol basis, FY '26 revenue stood at INR 8,984 crores as compared to INR 11,317 crores in previous year, reflecting a Y-o-Y change of negative 20.6%. The consolidated EBITDA stood at INR 1,766 crores with an EBITDA margin of 19.6%, while profit after tax stood at INR 1,398 crores as against INR 840 crores in FY '25. With that overview, we are now happy to open the floor for questions. Thank you.

[Operator Instructions] First question is from the line of Shravan Shah from Dolat Capital.

Congratulations on historic highest ever order inflow for us, INR 18,000 crores plus. And also good to see that the new presentation and particularly the MDO revenue profitability that you have said, which we were asking [indiscernible]. So now a couple of questions. So first on the MDO front itself. So now we will be sharing this on a quarterly basis, the MDO revenue profitability, what we have said on the Slide #14.

Sure, sir. We'll be sharing it on a quarterly basis, and thank you for your feedback. We understand you were asking for certain things. But strategically, what the company felt that this was the right time now to talk in greater detail about how we are planning to go ahead.

Yes. So a couple of questions on the MDO front. So is it possible for us to kind of a broader thought process in terms of the kind of one can say, a guidance in terms of the broader the revenue and the margin, given that we need to still do a coal handling plant CapEx for Siarmal. So obviously, the depreciation will increase. So how one can look at after 2 years kind of maybe a profitability or margin at the MDO level? And the related is how we are thinking to kind of monetize this from the investors' perspective. So whoever holding DBL shares, how they will get benefited through this -- the significant profitability that we have and obviously, the revenue visibility is significant.

Thank you, Shravan ji. I think it's a great question. Obviously, as any analyst, you would like to understand how this business will shape up and how the profitability and the revenues will shape up. See, the beauty about this business, it's a very simple to sort of project kind of business because every year, by law, we are supposed to do a contracted value. And the pricing per tonne that the government is going to pay for us is already set. So simply, what you have to do is as you keep on expanding our volume that we are providing every year, if you just do a simple mathematic fill number, that, okay, this year, if DBL did this much. So now Siarmal, you know that the rate is around, let's say, I think about INR 500 or so is the rate at Siarmal and about INR 1,100 tonne is a rate at Pachhwara. So the simple math that you will have to do is just do it a multiple into how the next 3 years because by FY '29, we will achieve full year target of 50 million metric tonne at Siarmal. And while Pachhwara is already working at the same 7 million metric tonne per year. Now if I talk about FY '27, we are expecting about 33 or 35 or 13 plus in that. And -- and similarly, the year after that, we are targeting upwards of 40 million at Siarmal and then 50, like I mentioned, in the fifth year. Now Pachhwara, like I said, will be same. Pottangi, in the next 3 years, we'll be setting it up. Again, the as per contract, we've defined how much we'll be doing in the next 3 years earlier in our earlier presentation as well. So the mining plan will be kind of flowing through that way only with the EPC business and the mining business will flow in that. So put together, and I think it's a safe sort of way assumption to take that you take similar profitability for your sake of making the model. That would be how you can sort of do the mining sort of revenue separately and how the profitability will look. Sorry. So what we anticipate in FY -- so from the current INR 1,600 crores of revenue in this year, we expect revenue to increase to about INR 2,500 crores or so in FY '27, which will further increase to about INR 3,000 plus INR 100 crores in FY '28. And eventually, I think in FY '29, we should be somewhere in the range of around INR 4,000 crores of revenue coming from this sector. So that's how it will kind of play out. If we were to do just a simple math of the multiplication of the total tonnage and the rate that we're at. So that's how it will work out. Now coming to the second part that you asked, see, all these are subsidiaries held completely under deliberild call. And obviously, we would want to ensure that our shareholders always get maximum returns. So at an appropriate time, if we feel there is a certain way which will help us extract a greater value from all these assets that will be functioning at their peak capacity, we will take that call. Currently, we have no such agenda to apprise the market of.

Got it. Got it, sir. Sir, For second question on the InvIT part. So you have mentioned that currently, we are closely is having a INR 200 crores InvIT in the Shrem and the INR 1,600 crores -- INR 1,400 crores in the Alpha. So put together, INR 1,600 crores after maybe INR 200 crore investment, we will be getting INR 1,800 crores more. So roughly INR 3,300 crores InvIT value that we will be having maybe a 2 years down the line. So there in presentation last time, we were kind of the distribution from Alpha particularly, that number was on the higher side for '21 now that number is on the lower side, INR 350 crores or then in 2019, it is coming INR 386 crores. So just wanted to understand, is there some understanding that now we will be getting a lesser dividend or whatever the return on the equity or the InvITs that we are holding?

So as far as the InvIT units value is concerned, you are right, after 11 assets further divestment to InvITs, that kind of InvIT units holding will be there. But at the same time, you must appreciate that the timing of transfer the assets to InvIT changed in FY '26. And in '27 also, we will be transferring 4 assets in quarter 1 and then balance in quarter 4 or quarter 1 of FY '28. So basis that the cash flow from the distribution is envisaged in the Slide #24 shown in the presentation.

Okay. Got it. Now sir, on the standalone part, the broader guidance number, just wanted to recheck. So on the standalone front, the revenue for FY '27, EBITDA margin, order inflow, how much we are looking at CapEx? And also, if you can help us in terms of the net debt, you have said that by FY '28, we will be net debt free. But in FY '27, how much one can look at to a reduction?

So Shravan ji, as I mentioned earlier as well, now FY '27 revenue target from -- if we look at FY '26 number, we mentioned it will be a 30% to 40% growth from this number. So we're in line with that because we have the order. The order book is very healthy right now at almost INR 28,000 crores. So we are very confident of the revenue that we should be able to get. That's where it will -- the revenue number would be at. Now in terms of our EBITDA, we are targeting that same 11%, 12% EBITDA that we have mentioned. That will be in line with that. Now more than that, we are also targeting about INR 10,000 crores, INR 12,000 crores of new order inflow to come in this financial year, which will provide us good visibility extending up to FY '30. So that will be there. Similarly, now you also asked us about the debt, how much we are anticipating to reduce in this financial year. We anticipate somewhere between INR 600 crores to INR 800 crores of debt will be reduced in this financial year. And already from last quarter, we've reduced about INR 250 crores to INR 300 crores of debt already. And we anticipate going forward in the next 2 years, like I mentioned, we should be where we are at near net debt 0 kind of numbers.

[Operator Instructions] Next question is from the line of Vignesh Iyer from Sequent Investments.

So my first question is actually related to the investments that we are going to make in the renewable energy and the transmission segment of it. And I was looking at the Slide #24 on our PPT, where I see that INR 1,250 crores for solar plus another INR 39 crores and transmission INR 435 crores investment is what we are planning over the period of next 2 years. So firstly, I wanted to understand the structure around this investment [indiscernible] like what exactly the structured equity from aquirer for transmission and solar [Technical Difficulty]

Sorry to interrupt, sir. Your voice is breaking.

Your voice is breaking. We can't understand very clearly because your voice -- there is some problem in the net.

Am I audible now?

Yes, you're audible now.

Yes, yes, sorry. So my question was again on the solar and transmission business, where we have decided to commit certain x amount of funds over a period of FY '27 and '28. So I wanted to understand the structure of this investment. Firstly, on the part where you are stating in Slide #24 that structured equity from acquirer for transmission, solar, a certain amount is given. What is it exactly? I mean, I want to understand the structure behind that. Secondly, I wanted to understand what would be our equity commitment and what would be the expected IRR on this project?

Basically, the idea of Dilip Buildcon in transmission and solar is to raise around 85% equity commitment through these projects from the investor who will be putting in equity during construction. So the commitment from DBL side would be 15% of the total equity requirement in these projects. In terms of EBITDA margin, in transmission, it is upward of 24%. And in solar -- sorry, you asked about IRR. So IRR would be high teens in both the projects.

Okay. So if I understand it right, for these projects, would you be floating a separate SPV where the fundraise would be done? Or how is it? That is the structure I was thinking about.

So basically, this is -- I said the acquirer will put in equity directly into the project [ costs ]. So transmission SPV, the potential acquirer will put in direct equity to the SPV of transmission and similarly in solar.

Okay. Okay. Got it. And yes, so my second question on this is on our the coal business. I heard you earlier regarding the MDO business where you gave a stated guidance on how you see the picture moving ahead. I wanted to just understand how do we see this business from the margin point of view, majorly, I mean, especially in quarter 4, I think the margins have come down a bit versus how do we see this margin going forward for the next 3 years to our stated target in FY '29? Would we see more like a fixed percentage of margin coming in? Or as we scale up, would we see that operating leverage playing in it?

Sir, thank you for your question. See, the margin that you are talking about that has come down in the mining business temporarily right now is primarily because the evacuation by the government could not be done on time. So there is at the Siarmal mine, right now, we have about 6 million metric tons of stock, which is lying at site because of delayed evacuation by the government and because of unavailability of racks. Otherwise, production from our side was doing well. And these are temporary issues. We expect this to kind of normalize with the government taking a keen interest in ensuring that all the supply chain logistics are kind of worked out. So we expect in the mid to term, this will all kind of normalize. Long term, if we talk about the margin profile, you're very right. There will be economies of scale that will play out as we work at peak capacity as our coal handling plant comes online. There is also a kicker in the contract where once the coal handling plant comes online, we will be entitled to a higher revenue share. So all those things will add to a sweetener much later. However, we are just saying when you're looking to build your model, you can build it conservatively around these numbers and understand how this business will kind of flow. But we are confident that as scale hits and as we also complete our coal-handling plant and hit COD, the margins will meaningfully improve.

Okay. I mean if I have to see just from the numbers perspective, FY '25 blended, the margin was around 26%. Now it is 23%. And quarter 4, because of onetime impact has led to a lower margin. So it would be fair to say that 24%, 25% is a more stabilized level of margin and any economies of scale that come after this would add on to the margin that is in place, right? If I...

You're right, sir. You're right. That range is the right range to take, and there will be improvement on that, yes.

Next question is from the line of Sanjay Parekh from Sohum Asset Managers Private Limited.

I just wanted as we move to 29 and 30, what are the annuity streams of revenue, if you can broadly for each of the segment, you can explain that is one. And secondly particularly renewable project, my colleague asked, but where are we because I think these are short tenure projects. So what is the status a little bit on the payback and the structured equity, again, I just wanted to understand that of the equity portion, 15% will be put by us, 85% will come as equity, but they will be given debt returns. Is that the way? And who could be the potential investors here? So that is a little more granular understanding of that project? And when do we start and when do we complete? That is -- that will help me.

Sanjay sir, thank you for your question. I think you asked a bunch of questions. So let me start with the last bit that you're saying. So the transmission and the solar projects that we are doing, the larger strategy for us, as we mentioned earlier, that we want to build different asset classes. Just like what we've done in the road sector, we want to build it in other sectors as well, whether it's water, whether it's transmission, whether it's renewable, whether it's oil and gas, we want to do it across. But having done that, we have also promised the market that we want to be a debt-free company by FY '28. So while our larger goal long term remains to create different platforms, short term, we also realize the reality that if we invest all our free cash in equity, then we won't be able to achieve our goal of being a debt-free company by '28. So the model that we are going to do in between right now is that whatever these assets that we are building, we will build these assets, make our EPC margin. And we are looking to divest these assets at an earlier stage and find an investor right now also so that we attain our short-term goal of 2028 being near net debt free. That is why we are looking for investors currently in these assets. Now 2 years down the line, when I'm completely debt-free, when I'm doing these assets, I will look to hold on because we will have significant amount of free cash flow coming from our mining operations, from our InvIT operations. So my thing would be at that time, where do I deploy this capital, which not only gives a greater return for my investors, but also gives us EPC business. So that will be the long-term goal that we have. So I hope -- the strategy that the company has is basically on the short term, why we're doing this finding a buyer right now is kind of clear because we want to also be net debt free and not put all our equity into building these assets. and then sell it completely at that one time. Hence, this methodology and the [indiscernible] media has been adopted right now. That is the goal. The structure that you are asking, it won't be like any investor who is coming in, it won't be a near debt kind of return that they'll be looking at. They'll be looking at, obviously, a more higher return than that. And we will be structuring to see how both their sort of aspirations and our goals can meet and we can find a common way between both of them. That will be the idea and the goal for us. And those discussions are ongoing. Obviously, I'm not at the liberty to talk about any names and what it is. But I'm sure we'll be able to give you a better clarity and good news on that in the coming sort of short term only because those discussions are going on, and we will give you better clarity going forward.

No, it's is very helpful, Rohan bhai. Only one thing on the year, the structuring of this will be -- the debt portion will be depend on the structure, right, just to understand? The structure has to be in place for you to get the debt for the project.

Sir, the structure of -- so the SPV has already been formed, all the SPVs have been formed. Now the equity and debt that has to be put in them, all of them have also been defined already, that how much equity and how much debt will go in each that has been defined. We have also gone to the lenders with that same structure, okay, that this is the equity that we'll put in and this is the debt that we will need. We also have in-principle approval from lenders for all the projects that we are talking about. So we also have that. So all that process is done. Now the equity, let's say, in solar, about INR 1,200 crores of equity and in transmission about INR 400 crores of equity has to go, now what we are doing is of the INR 1,600 crores of equity, we are looking to find a solution that 85% of the capital that has to be invested as equity comes from the investor, while 15% is put by on DBL's own balance sheet. So essentially, the cash that then gets -- the free cash that is generated at the company level goes and reduces my standalone debt. So that is the goal because in these 2 areas right now, we don't have an InvIT. However, for the road, we already have an InvIT. We already have an exit platform. We already have units already that we are holding. So we would not want to let go of all those finished assets right now, but rather do this and because this is not a ready platform that we have, we are open to selling it completely also at this juncture just to, like I said, achieve our short-term goal of being a near net debt company by FY '28.

Perfect. Perfect. This is very helpful. And what is the commissioning deadline for this? Is there any commissioning deadline?

2 years. 2 years.

2 years from April '26?

Yes. that is broad line, whenever we start the project, so 2 years from there, it will go from the letter of -- yes, approved date, yes.

Next question is from the line of Subhankar Ojha from SKS Capital & Research.

Sir, just quickly in terms of how many more assets to be transferred to this Anantam InvIT? And by when this will be done?

Sir, this is -- we have 11 more assets to be transferred into the Anantam InvIT, the road assets that we're talking about. And this will be happening gradually through this year and by first quarter next year is what we are expecting.

And how much more equity -- I mean, how much investment you'll have to put in for these assets to be completed and transferred?

Sir, for the 11 assets in total, it is less than INR 200 crores, INR 169 crores to be exact right now, which is there on in the presentation Slide #24, you will find it there.

Okay. And once this is transferred, so by next year, quarter 1, what will be your the valuation of those...

Sir, about INR 3,000 crores, INR 3,300 crores [Foreign Language] that will be total InvIT value that we'll have including the 7 assets that we've done and these 11 that will go [Foreign Language] against the total 18 assets that we have that we will be putting in the InvIT, we will have InvIT units worth between INR 3,000 crores to INR 3,300 crores.

So here, you have INR 3,300 crores and the other one is INR 200 crores. So there is...

Yes.

So that INR 200 crores is there. And you don't have any further increase of value in that [indiscernible]. Is that right?

No, that will be the same. It's an InvIT unit. Those units are there. It is giving us dividend income.

Yes. So it's about INR 3,500 crores plus in your ownership of assets in these 2.

Yes, somewhere in that range, sir. So this will obviously -- all these are dependent on the final number because there is always change of scope that happens at the project level. The government is not able to give us all the land at times. So the final BPC value obviously always determines. So these are obviously broad strokes that we're telling you.

I see. Great, sir, in terms of -- obviously, you have talked about it in terms of your payment from JJM last quarter. What is the status now? Do you have any further payment to be received from JJM and...

Payments are regular monthly payments are happening there. We don't have any hold up there. That was earlier in the year that had been there, but there are hold up on JJM payments.

Next question is from the line of Ishita Lodha from Svan Investment.

Congratulations on a very strong order inflow, much better than the other industry peers. I have a few questions for the CFO, sir. As per Slide #33, the receivables have increased from INR 1,384 crores as on March '25 to INR 1,783 crores as on March 26, despite 22% decline in revenue and the funds that were blocked from Jal Jeevan Mission have been released. Can you just explain?

So basically, there are 2 types of payments from Jal Jeevan Mission. One is basically regular bills and one is basically the final amounts. So Jal Jeevan Mission, the last 10%, which is basically uncertified one, which will be paid once we will do the last hydro testing. So that INR 400 crores will be paid once we will do the hydro testing. So basically, it will happen partly this quarter and partly next quarter. So the increase in receivable from FY '25 to '26 is mainly on account of this INR 400 crore receivable from the uncertified from the Jal Jeevan Mission projects.

Okay. And given the debt reduction target of INR 600 crores to INR 800 crores in FY '27, what is our expected interest outgo from the cash flow next year?

So basically, if you can see this year also, we reduced around 11% interest cost. Next year, the interest cost with the reduction in the net debt, we feel the total interest outgo would be close to between INR 375 crores to INR 400 crores.

Okay. And I heard in the opening remarks that the order inflow was INR 18,500 crores. But if I do the back of envelope calculation, taking closing order book of INR 28,800 crores and opening order book of almost INR 15,000 crores and execution of INR 7,000 crores, the implied order inflow comes to INR 22,000 crores. So the differential of INR 2,400 crores is change of order or the order inflow that you received since FY '27?

So madam, you can see -- let me tell you the slide number and remarks below the slide number, we aid because the INR 18,550 crore order book order is from third parties, whereas we have orders from our coal business. So we aid the coal business -- next 3 years order book and every quarter has changed because we are in the phase where the volumes are increasing. So every quarter, there is addition. So just see the note on the Slide #18.

Okay. Understood. And sir, what was the distribution income from Shrem and Alpha that was included in the standalone other income in FY '26?

Total dividend and interest income during FY '26 from both the units are INR 64.5 crores. And the distribution was higher. So the total distribution was close to INR 100 crores.

Okay. And with respect to -- so in the opening remarks, it was mentioned that bitumen and raw material costs have increased due to the crude price impact. So can we pass this on entirely? What is the on our margins?

So basically, the -- for every contract, there is an inflation formula from which we get the impact of the increase in pricing of these raw material or the items, but this formula may not give you 100% increase because you can see the increase in the HSD and bitumen prices sharply. But the formula gives partly adjusted through the formula. But the balance is impact on the margins. So you can see some margin impact on coal business where the HSD is the major cost. So there will be some impact.

Next question is from the line of Vishal Periwal from PL Capital.

Sir, in terms of interest cost, though you did clarify how you see the projective next year. But if I look at FY '26, interest costs have gone down, but debt level has seen an increase absolute level basis.

So basically, let me tell you, at the standalone level, yes, interest cost is reduced by 11%, and that is mainly because of the reduction in the cost of debt. Basically, the working capital cost of debt is reduced significantly on WCDL the interest rate reduced by almost 125 basis points, that is the impact on the interest rate -- interest cost.

Okay. Because our revenue has also declined. So maybe probably mobilization advance or I mean like the interest cost linked to that, it will have certain bearing on the...

Yes, you are right, partly the impact of the lesser mobilization advance as well.

Yes. So maybe next year, when we are targeting a growth interest costs, I mean, like at an absolute level, do you see it will reduce? Reason is in terms of the outflow equity tracker that you mentioned, there is a shortfall around INR 250-odd crores. Short-term debt could see an increase, revenues are increasing and interest for the absolute level, it could increase. So is that fair to understand or probably I'm missing?

So basically, if you heard Rohan ji in the opening remarks, he said this year, basically, by March '28, our target is to make this company debt free. So this year, we will be reducing close to INR 600 crores to INR 800 crores debt gradually. So the primary impact of interest reduction in absolute terms would be from the debt reduction.

Next question is from the line of Vignesh Iyer from Sequent Investments.

Yes. Sir, my question is, I wanted to understand on our standalone EPC order book I wanted to understand the part where do you think the ongoing war, there has been RM excalation -- and how -- so do we have a clause in place for pass-through of this escalation of raw materials? How is the arrangement for us and whichever order we have got till now?

Sir, obviously, whenever there is such a sudden spike or increase in prices, no contract will ever protect you against that because government contracts are linked more towards the WPI and CPI index and not -- does not take into account in this thing. So it's not completely passed through, and we will be facing those challenges as well as will be the rest of the industry. The -- I guess the saving grace here is the government is aware of this issue. And we as a federation, the National Highway Builder Federation, we are also talking with the government about these issues. And we're trying to see how this blow can be softened. And hopefully, in the coming sort of days, there should be some kind of regulation that could do. I don't think and know that everything can or would be protected. But -- but there will definitely be some kind of respite that we hope that the government will kind of step in and do.

Right. Sir, could you share what is our cost of borrowing for our out...

So our cost of borrowing around 9% on average basis.

Ladies and gentlemen, that was the last question of the day. I now hand the conference over to Mr. Rohan Suryavanshi for closing comments. Over to you.

On behalf of the whole DBL family, I thank all of our partners who came and joined and ask questions. I think please do go through our presentation in detail because we have taken significant -- we put significant thought in terms of designing it for you guys to how the future of the company will pan out. And I think that might be very useful for an investor looking at how the company will shape up. So thank you very much, and I look forward to seeing all of you guys for our next quarter call.

Thank you. On behalf of the Dilip Buildcon Limited, that concludes this conference. Thank you for joining us and you may now disconnect your lines.