G R Infraprojects Limited (GRINFRA) Earnings Call Transcript & Summary

Ladies and gentlemen, good day, and welcome to G R Infraprojects Limited Q2 H1 FY '26 Earnings Conference Call hosted by HDFC Securities Limited. This conference call may contain 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 the guarantees of future performance and involves risks and uncertainties that are difficult to predict. [Operator Instructions] Please note that this conference is being recorded. We have the management from G R Infraprojects Limited, Mr. Ajendra Kumar Agarwal, Managing Director; and Mr. Anand Rathi, Group CFO. I now hand the conference over to Mr. Parikshit Kandpal from HDFC Securities. Thank you, and over to you, sir.

Thank you, Rashi. Without any further time, I'll now hand the floor to Ajendra ji for his opening remarks on the industry and financial updates. Thank you, and over to you, sir.

Thank you, Parikshit ji. Dear all, a very good afternoon. I welcome you all to earnings call of G R Infraprojects Limited for Q2 financial year '26. I also have with us on the call Mr. Anand Rathi, the CFO; and Mr. Ankit Maheshwari, Deputy CFO of the company. First, let me provide the key highlights on our Q2 performance, followed by recent developments in the infrastructure sector, followed by question-and-answer session. Revenue from operation in second quarter of fiscal 2026 stood at INR 1,234 crores as against INR 1,128 crores in corresponding period in previous financial year. The EBITDA margin, excluding other income for the current quarter stood at 9.76% as against 10.39% in the corresponding period in previous financial year. During the quarter, company has repaid the debt of INR 262 crores, which has resulted to debt equity ratio to 0.03, one of the best in the sector. [Technical Difficulty] the company had won one power transmission and distribution project of INR 3,136 crores and one highway project of INR 246 crores. As of [Technical Difficulty] 2 road projects of INR 4,300 crores approximately are having L1 status. As on the date, the order book stood at INR 21,000 crores approximately. As on the date, one DBFOT project of INR 3,700 crores of appointment date is awaiting [Technical Difficulty] INR 4,300 crores approximately, which are yet to be opened, it constitutes one highway and 2 hydro and tunnels projects. Moving on the sector highlights and infrastructure development of India. Road sector. [indiscernible] expect the road award by both to stand at 9,000 to 9,500 kilometers in financial year 2026, slightly higher than the estimated 8,500 kilometers for financial year 2025. The recent announcement for the construction of 25 greenfield expressway spans 10,000 kilometers and posting INR 6 lakh crores [Technical Difficulty] of INR [ 1.25 lakh crores. ] Total national highway toll collection are projected to surpass INR 50,000 crores for the first time in financial year '25-'26, up from INR 72,900 crores in financial year 2025. The number of toll users increased by [ 16.2% ] [Technical Difficulty]. Financial year '26 reaching 1,173 million transactions. The toll rate growth is likely to remain at 3% to 4% in financial year '26. At the same time, the Ministry has also asked the NITI Aayog to renew the 30 years old toll collection rules for national highways aim to be fairer pricing system to make the model more acceptable by all the stakeholders. Power transmission. As for the national electricity plan, over 1.91 lakh circuit kilometers of transmission lines and 1,270 gigavolt ampere of transformation capacity is planned to be added till 2031-'32. In additional, 33 gigawatt of high voltage direct current [Technical Difficulty] plan, the transmission plan provides visibility of the massive investment opportunity of over INR 9 lakh crores of transmission sector till the year 2032. Hydro and tunnels. We are looking towards to expand this sector through hydro pump storage projects. It has been taken a big leap now and from this year onwards, roughly 3 gigawatts of PSP will be added on the average every year as per Central Electricity Authority. By 2032, the target somewhere around 50 gigawatt capacity coming from the hydro pump storage. Here, I would like to mention that for decades, the company has been at the forefront of national building construction highways and delivering world-class infrastructure that connects communities and drive progress. The global economy is witnessing the rapid transformation with energy transition and technological innovation and integrated logistics redefining the way industry operate. As part of our continued diversification strategy, the company is evaluating opportunity in the EPC business of oil and gas sector. In the offshore stream and based on the opportunities available, we are targeting an yearly revenue contribution of INR 1,000 crores to INR 1,500 crores over the next 3 years. Further, we are happy to say that the company has moved to its own corporate office named as GR. Lastly, I wish to inform you that Vinod Kumar Agarwal, Chairman and Whole-Time Director of G R Infraprojects Limited has tendered his resignation from the position of Chairman and Whole-time Director as well as from the office of the directorship of the company. It was due to health reason that has limited to his ability to devote the time and attention to the company. He has been associate with the company since its very inception in 1995. Over the past 3 decades, he has played a pivotal role in shaping the growth and success of G R Infraprojects Limited, guiding it from the modest beginning to becoming one of India's leading infrastructure company. His vision and unwavering commitment has been instrumental in building a strong foundation on which the company stands today. We deeply appreciate his immense contribution and dedicated service throughout his long association with the company. Over to you, Anand ji, update on financial position of the company.

Good afternoon. Thank you, sir. [Technical Difficulty] key highlights of the quarter 2 performance of the company. Our standalone revenue from operation was INR 1,234 crores approximately in the quarter ended September 2025, which is increased by 9.36% year-on-year basis. [Technical Difficulty] this was primarily on account of the higher execution of the projects. Our consolidated revenue from the operation was INR 1,602 crores in quarter ended September '25, which increased by almost 15% year-on-year basis compared to INR 1,394 crores in quarter ended September 2024. Standalone EBITDA margin stood at 9.76% in quarter ended September '25 from 10.39% quarter ended September 2024. This decrease is primarily due to one-time claim income recognized of INR 21 crores in quarter ended September 2024. Consequently, our EBITDA margin at gross level also has marginally decreased to 24% in quarter ended September 2025 from 25% in quarter ended September 2024. Profit after tax at standalone level increased to INR 131 crores in quarter ended September 2025 as compared to INR 115 crores in quarter ended September '24. This increase is primarily result of lowering of interest cost and depreciation during the quarter. Profit after tax at consolidated level decreased to INR 189.5 crores in quarter ended September '25 as compared to [ INR 193.5 crores ] in quarter ended September 2024. Standalone net worth stood at almost INR 8,239 crores at the end of September '25 which was INR 7,888 crores at the end of fiscal 2025. Our net worth on consol level is INR 8,942 crores at the end of September '25, which was INR 8,503 crores at the end of fiscal 2025. Total standalone borrowing outstanding at the end of fiscal 2025 -- sorry, at the September 2025 is INR 240 crores with debt to equity of 0.03x. Our consolidated borrowing outstanding at the end of September 2025 INR 5,995 crores with debt to equity ratio of 0.67x at consol level. During the quarter, company has made addition to the fixed asset amounted to INR 18.5 crores and net block of property, plant and equipment is INR 1,146 crores at the end of September 2025. Investment subsidiary company in form of loans and equity is INR 2,698 crores at the end of September 2025. Balance promoter contribution required to be made for our operational or under constructions HAM, BoT or power transmission for the user base INR 3,205 crores which we are expecting contribution of almost INR 500 crores in the second half of the fiscal 2026. Our working capital in days at the end of September '25 is 98 days, as compared to 170 days at the end of fiscal 2025, this decrease is primarily on account of decrease in SPV debtors and unbilled revenue. Our trade receivable at the end by standalone basis are INR 686 crores, which includes INR 1,525 crores of HAM debtors at the end of September 2025. Our trade receivable at the consolidated level are INR 195 crores at the end of September 2025. Our unbilled revenue at the standalone basis is around INR 560 crores at the end of September 2025 and at the same at the consol level is INR 407 crores at the end of September 2025. Our inventories are around INR 583 crores at the end of September '25 as compared to INR 538 crores at the end of fiscal 2025. That's all about the financial highlights for the quarter ended September 2025. I take this opportunity to thank you all our stakeholders, including employees, business partners, vendors, bankers, innovators who have supported the company in its transformation journey. On behalf of G R Infraprojects Limited, I also thank everybody for attending the earnings call. Thank you. May I request the moderator to open the floor for question-and-answer, please.

[Operator Instructions] The first question is from the line of Mr. Shravan Shah from Dolat Capital.

Sir, first, a couple of questions on the guidance and then maybe I have a detail on that. So now in the 1H on the revenue front, we have done just 1.2%, and we were looking at 10% to 15% growth this year. So that means 18% to 28% kind of ask rate is needed in the second half. So just wanted how now we are looking at the revenue for FY '26 and also in terms of the order inflow. So excluding the GST till now, how much we have received? And how much more are we targeting this year?

[Foreign Language]

[Foreign Language]

So Shravan bhai, so that guidance in terms of inflow for the current year remains the same what we have given in the past. The issue is -- only thing is that project awarding or bidding would delay [Foreign Language] so what we are targeting for the current year, what we have targeted is INR 22,000 crores to INR 25,000 crores [Foreign Language] project, we will try to win, right? And we are expecting that because [Foreign Language] which anyway we are expecting that in quarter 4 that would be starting awarding and our bidding [Foreign Language] so we'll be getting those project in that date of time during quarter 4 only. So for the current year, in terms of total incoming order book, we are targeting between INR 22,000 crores to INR 25,000 crores. [Foreign Language] we have taken so far. [Foreign Language]

[Foreign Language]

[Foreign Language] In railway, metro, there also we are targeting INR 257 crores of -- hydro, tunnel, power transmission, we have taken good amount of work [Foreign Language] I mean, given that the tweak which has happened in policies and [Foreign Language] in terms of qualification as well as network issues we believe that we'll be able to get this kind of project.

[Foreign Language]

[Foreign Language] So I think for '27, yes, of course, I mean, current year INR 20,000 crores we will be able to get, so '27-'28 certainly we will be adding double-digit growth.

[Foreign Language] Yes. Double-digit, so sir 10% is also double-digit. So we need significant [Foreign Language]

I said 10% to -- current year maybe we are targeting [Foreign Language] 2, 3 months or this is working season, right? [Foreign Language] Otherwise, our earlier estimate was 10% [Technical Difficulty] for the current year also. So maybe we will not be going back to 10% [Foreign Language] but going forward, maybe in '27, depending on what kind of order we are getting in the current year, we'll be having at least 15% kind of growth.

[Foreign Language]

[Foreign Language] See, right now, we are expecting -- for decent growth also we need INR 20,000 crore of order, right? [Foreign Language] where we can show the growth of 20%. So my margin would definitely increase. But otherwise, I believe that [Foreign Language]

The next question is from the line of Mr. Abhinav from ICICI Securities.

My question is on the status of orders where we are L1. We were expecting LoA and also the other project Agra project where appointed date is pending. So what are the challenges that you are facing? When can we expect it to be converted into LoA and verification to start?

[Foreign Language]

Understood. And sir, when you say about INR 20,000 crores of order inflows, that is considering this L1s or apart from that?

Apart from this. It is over and above.

And sir, how is the pipeline looking like -- can you quantify segment-wise, what is the opportunity?

[Foreign Language]

Understood. As a final question, what is the equity incision that is pending for this financial year H2?

We are targeting around INR 400 crores to INR 500 crores for the H2.

The next question is from the line of Mr. Mohit from ICICI Securities.

[Foreign Language]

[Foreign Language]

[Foreign Language] can you just quantify the kind of work which we can do?

[Foreign Language]

Understood, sir. [Foreign Language]

[Foreign Language] actually running into 3 years, the transmission is 2, 2.5 years or road is basically 2.5 years again. [indiscernible] it will take another 3 years. [Foreign Language]

Understood, sir. Last question, sir [Foreign Language]

[Foreign Language]

The next question is from the line of Mr. Ayush from [indiscernible].

Sir my question was regarding 2 projects. One is the Bamni one and another one is Anjar Bhuj. So I think they passed due the completion date. So is there any update on those?

Bamni and Anjar Bhuj, let me come back. Your question is with respect to the status of those projects, right?

Yes, the completion date. I think they passed the completion date [Technical Difficulty]

[Foreign Language] Bamni project is -- schedule shared is June '26, right? Anjar Bhuj is April 2026. That is where [Technical Difficulty]

Okay. And sir, my next question is regarding to the maintenance CapEx that we're expecting in the H2 and also maybe the next [Technical Difficulty] if you can give us some insights.

Maintenance CapEx.

Yes, the CapEx we are expecting to do.

See, maintenance, I don't think we will be -- I mean, maintenance is always the usual activities for us basically. And we are not basically maintaining this kind of maintenance CapEx. Because, yes, there are 2, 3 projects which will be coming under major maintenance maybe in next year -- in first half or in second half of the current year or maybe first half of the next year. I mean this is the status of that road particularly, it may be delayed by another 1 year. So it may not be -- yes.

Okay. So the last question is regarding that, are we going to transfer any project to the Indus Infra fund during this financial year?

Yes. I mean this one particular project is already -- I mean, where we have taken the Board approval to transfer to that InvIT. And depending on -- I mean, we can -- additionally, we can transfer 1 or 2 more projects in second half of the year.

[Operator Instructions] The next question is from the line of Mr. Vaibhav Shah from JM Financial Limited.

Sir, in terms of equity requirements, so what will be the number for FY '26-'27 and '28.

See total outstanding equity which has to be infused so far is now INR 3,200 crores over the period of next 3 years, right? So maybe on a yearly basis, it would be around INR 1,000 crores.

And how much you have infused in first half of this year?

Equity contribution in the first half. Let me check, I'll come back to you.

Sure. Sir, what is our CapEx guidance for the entire year?

The entire year CapEx would be in the range of INR 100 crores. So far, we have put in almost INR 50 crores.

Okay. Sir, I missed the number for HAM debtors.

It is around INR 1,500 crores-odd. [Technical Difficulty]

For this year, the revenue growth will be somewhere around 5%, 6-odd percent. And next year, we can see a 15% growth. Am I right?

Yes, yes. Next year, 15%, depending on it, we'll be able to get in current year, INR 20,000 crores of incoming orders.

But even if I consider the current backlog, if those orders also received the appointed date, then also 15% should not be a challenge.

Yes, yes. Depending -- I mean, see one is the year, which we are expecting that the Agra Gwalior project, right, which we are expecting that appointed date would be at least anywhere in -- I mean, maybe in first month of the next quarter. And accordingly, -- so I mean it depends -- but generally, what we are expecting that next year certainly we'll be growing.

Okay. Sir, secondly, for the 2 MSRDC orders Nagpur Chandrapur Package-1 and Pune Ring Road Package E6, sir, mentioned that there might be a cancellation. So have we factored any revenues from the project in '27 in our estimates?

No, no. So whatever -- some orders are there, right?

So it can be canceled both the orders.

[Foreign Language]

[Foreign Language]

[Foreign Language]

[Foreign Language]

[Foreign Language]

In the first half...

Yes. First half.

[Operator Instructions] The next question is from the line of Mr. Parvez from Nuvama Group.

A couple of questions from my side. The transmission project that we won this quarter, what would be the EPC cost of that particular project?

EPC cost we have considered for this in our order book is around INR 1,700 crores or INR 1,800 crores-odd. Though the project size was around INR 3,100 crores, so for SPV it's around [ INR 3,750 crores ] and rest is basically materials [indiscernible]

You said the HAM debtors were about INR 1,525 crores, right?

INR 1,525 crores, yes.

Lastly of our INR 21,000 crores order book, what is the quantum of projects where we are yet to get the appointed date?

It's only one. Transmission effectively is getting -- I mean the project is taken a start as and when the company is handed over to us. So last -- I mean the last 2 projects which we have got is transmission one and Agra one. So Agra is yet to be declared appointed date. But technically, it is only Agra project for which appointed date is [ 20. ]

For the BSNL project [Technical Difficulty] right?

BSNL...

That is already started.

Yes, that is already started.