Garden Reach Shipbuilders & Engineers Limited ($GRSE)

Ladies and gentlemen, good day, and welcome to the conference call of Garden Reach Shipbuilders & Engineers Limited, arranged by Concept Investor Relations to discuss its Q4 and FY '26 results. We have with us today Commodore P.R. Hari, Indian Navy retired, Chairman and Managing Director; and Shri Niranjan Mukund Bhalerao, Director Finance and CFO; and Shri Sandeep Mahapatra, Company Secretary and Compliance Officer. Please note that this conference will be recorded. I would now like to hand over the floor to Commodore P.R. Hari, Chairman and Managing Director. Thank you, and over to you, sir.

Thank you. Good afternoon, ladies and gentlemen. And a warm welcome to each one of you to the -- I welcome you each one of you to the conference call of Garden Shipbuilders to discuss the results for Q4 and financial year ending 31st March 2026. With me here are Shri Niranjan Bhalerao, Director of Finance and Chief Financial Officer; [indiscernible] Gosh, Chief General Manager Finance; and Smt. Aparajita Ghosh, the company secretary. And over the next few minutes, I shall give you a glimpse of our financial performance and thereafter, highlight the physical performance that has resulted in the company recording strong numbers during the last financial year. I shall also touch upon the current order book execution plan for the ongoing projects, other [indiscernible] and the future outlook of the company, including a glimpse of our expansion plans. As stated, our financial performance during the quarter and financial year ending to ended 2026 March 31 have been strong. And this has been the result of an equally robust typical performance. During the quarter as well as the year, we have recorded our best ever financial performance. The revenue from operations recorded during the quarter was INR 2,119 crores registering a growth of 29% over the last year. And profit after tax has slowed up by 24% from INR 244 crores to INR 303 crores. Similarly, the margins have also shown a substantial interest. When we take the full financial year, I'm happy to inform you that they are recorded a revenue from operations of INR 7,002 crores, registering a growth of 38% over the last financial year. Similarly, our profit after tax has moved up from INR 527 crores to INR 748 crores, registering a growth of 42%. So all in all, the financial layer has been excellent for us and so has been the quarter 4. Coming to the physical performance. Our core business continues to be shipping [indiscernible] perspective, This, again, has been the best ever here in the history of the company. We delivered a warship to the indeed. And interestingly, 3 of these vessels were delivered on the same day, and this perhaps is the first time in the history of our country. We also launched 1 warship as the [indiscernible] of 19 platforms, this 19, of course, include 13 hybrid series that we are building for the government of [indiscernible] plus 6 more platforms. We have done the [indiscernible] during the last year. Coming to the other business verticals. Naval Surface Guns were delivered during the last year, and 4 of these have successfully completed to [indiscernible]. We also delivered 110 [indiscernible] ores. As you are aware, we have a daily budget business vertical. And during the last year, we delivered 110 that just including [ 40 ] for export. I'm also happy to inform you that the revenue from this particular vertical has touched at INR 200-plus crores for the first time in the history of that vertical. Also, we have recorded a revenue of over INR 270 crores from exports. Our current order book stand at INR [ 15,324.13 ] crores. Actually, I'm happy that the order book has dropped below INR 20,000 crores. In the last 5 years is the first time that the [indiscernible] dropping to INR 20,000 crores. And to my appreciation with an indication that our execution rate has improved. This order book comprised of 9 projects consisting of 9 platforms. The P-17 Alpha project, one more ships to be delivered anti-submarine shallow watercraft project, we have 4 ships pending for delivery for next generation post offshore patrol vessels 1 ocean to first vessel, 1 acquisitors to [indiscernible], 2 cost on the first vessel, 3 hybrid series, 4 multipurpose vessels and 1,000 meter cube [indiscernible]. Now coming to the execution plan of these ongoing projects, I had mentioned 1 season in Alpha ship is ACB delivered. This ship has already recorded about 74% physical progress of construction. And we intend delivering this ship during the current calendar year. The project is on schedule. Coming to the anticipation to class project. This is an 8 ship project and [indiscernible] 4 has already been delivered. And the remaining 4 ships, 2 of them have touched about 80% typical for us of construction and the basin trials have been completed and we are preparing them for the contractor retails, and we intend delivering these ships by the mid of the calendar year. The last 2 ships, ships [indiscernible] have touched around 60% typical process of construction. And we'll be delivering these ships during the current financial year, thereby completing this project on [indiscernible]. Coming to the next [indiscernible] project. This is a 4-ship project. And the first of the ships have reached the stage of launch and the launch of this circle is planned on 20th of this month. The progress of products and construction of the remaining preships is also satisfactory. And we intend completing this project during financial year '29. Coming to the other projects, the nondefense project, the ocean, the search vessel this we are constructing for the Ministry of Health and as one of their organizations called the NCPOR Goa . This vessel has led undergone about 50% of transactions and the super planned for launch during the current calendar year. The acoustic refer ship that we are constructing for the DRDO. The ship has touched almost 20% typical progress of construction. And the very -- the 14 [indiscernible], they're on pace. And the first 2 series of the 100 packs are expected to be launched during May, but is this month. And the next one is plan for launch in the next month. This project shall be completed by the end of the current financial year. Now coming to the 2 export projects. As you are aware, we are executing a project for a German plant with 1 ship multi-purpose vessel project. The filing was one of the project milestones of the ships have already been completed and the project is on track as of now. And the last project the project that we are executing for the government of Bangladesh [indiscernible] project on track and we been launching this vessel during the current financial year. This in a nation gives you the execution plan for the orders impact. Now coming to what is on the anvil. The orders on the anvil, as you are aware, that we are the L1 for the next-generation carpet project, the price negotiations have already been completed, and we are awaiting the formal signing of contract. The rate is not fixed. It could happen any of these base order values to the tune of around INR 33,000 crores. Currently, 3 tenders are live. One for the Indian Navy and 2 for the Indian post that the multipurpose retro these -- the center is already out, we expect the order value to be to the tune of around INR 1,500 crores. And the next generation of shore petrol vessels or in cost that these vessels again part of us to a tune of around INR 2,000 crores and 22 in the sector bodes for the Indian post that again. The order value is likely to be tuned up for INR 1,000 crores. In addition, projects where we expect the RFPs to promote in the next 3 months, 120 passed in the [indiscernible] project for the Indian mainly. The order value to the tune of [indiscernible]. The 31 follow-on waterjet project again for the Indian Navy, about INR 3,500 and [indiscernible] travel ships, [indiscernible] cost even as you are aware, have already been recorded. We expect RFP to come out in the next 3 months and all the value is likely to the tune of around INR 70,000 crores. This is in addition to the 12 count measure at the same CMB project taken for the Indian Navy. AoN value is around INR 32,000 crores and 4 landing platform dock [indiscernible] the order value reflected to the tune of around INR 35,000 crores. I have not included that X-generation destroyer or any other projects, which are yet to get to the AoN status. These are the what I've listed out or only the projects where AoN has been accorded and as we appreciate the first projects that is 120 FIC, 31 on, what is it and the 3, we expect RFP to come out in the next 3 months and the other 2 projects, [indiscernible] condemnation and the landing platform dock most likely during the current financial year. And this -- so the total order estimated order that is to the tune of about INR 1 lakh 50,000 crores, excluding of course, the NGC project. In addition, what we had been discussing earlier, the aggregated demand of the domestic requirement of commercial vessels, aggregated by the Ministry of shipping. Now has gained traction. And the 4 tenders are live for platform support vessels the cost could be to tune [indiscernible] for MR tankers, very large gas carriers VLGC and 6 [indiscernible] vessels. So these tenders are light. And definitely, we would be taking part in these tenders. Although action gives you the visibility on the opportunities that are currently available. Coming to our expansion plan. As Pat stated before, our expansion plans are on the right track. And just to give you the perspective, our current building capacity is for construction of 28 platforms. And with the ongoing expansion of projects that the modernization projects within our premises, this capacity will get increased to by the end of the calendar year. And the projects that we have taken on for our expansion is creation of 2 brownfield ship building facilities in West Bengal and 2 infield shipbuilding facilities on in West Bengal and 1 in Gujarat. What we envisage with the revitalization package to post building that has been promoted by the government, which is to the tune of around [ INR 6,000 crores ] and the demand for platforms that has already been aggregated by the Ministry of Shipping, we expect the machines building segment to take momentum gather momentum and it is [indiscernible] building that we are expanding to increase our shipbuilding capacity. So I have broadly give you a lens or financial performance and how the strong physical performance during the last year was altered in this financial results. Given you a glimpse of the order book, the execution plan the orders on the handle and also touched upon the expression plans. I finished, ladies and gentlemen, we may like to ask any questions as appropriate. The moderator may take on, please?

[Operator Instructions] First question is from the line of Amit Dixit from GS Investments.

First of all, congratulations for a very robust quarter and the year, sir. Couple of questions from my side. The first one is on -- if I go through the statutory committee of defense reports, then something very striking that if you look at the summary of contracts that are expected to be signed over the next 2 years. These have gone down substantially. In the last report, it was around INR 42,000 crores in the report released in March. It is only INR 18,900 crores approximately for warships and survey vessels, that particular category. So in that light, I just wanted to understand that how do we look at the focus of the government in the near term on these are ships and survey vessels that is our core area. So that is the first question.

Thank you, Mr. Amit. Now when the figure of INR 18,900 crores has been allotted for strip building different shipbuilding. In my position, there is a fund outflow during the particular year. But as you're aware that government, including during the last year, perhaps even during the last different acquisition council have given a great signal for multiple projects what I had listed out earlier. So the government focus on was there, and it is evident from the fact that on is being accorded and the specs are being promulgated on tank by both the major [indiscernible] and the coastguard. And also the fact that these are getting translated into contracts. So that's why my first statement was that the NGC project is live and together the element is to the INR 1,000 crores only for us. So the figure, what you have mentioned is perhaps the fund outflow that is anticipated from these projects during a particular financial state, and that depends upon the project maturity. Now another aspect is that both services in the American services to the Navy and the coastguard have absolutely clear road map and stated prospective plans, which have been approved by the government. So to answer your question the figures what we have stated does not reflect our intent nor intent of the tone or the progress made in this direction.

Great, sir, very comforting. The second question that I have is, again, taking a step back, it's a very macro kind of question. I mean considering the current warfare that is there and the CPR of the government, where -- I mean where the a lot of focus on autonomous vessels on drones, on new wave electronics. So where do you think the traditional platforms like core and destroyers stand or stack, isn't the relevance of these traditional platforms declining, is part one. Part 2 is that how GRSE is gearing itself for maybe the autonomous kind of veer vessels or some kind of modern ships or the small shift that are being increasingly used in modern what's there. So are there some investments that we are kind of making in that front? Or what is your strategy on that? I mean it's a 5-year question, not something that can be done in next year or something? So just wanted your thoughts on this.

Thank you. You're absolutely right that there has been an increased focus on autonomous vessels, what the visible outside is the fact that our current situation has brought the focus of the government to afford. But otherwise, again, Indian Navy has got and the nano road map almost, which was delegated almost 3 years back, even before the current situation is placed to the state is where it is now. So it is just that for us also, I would say, the realm of direct warfare. This is coming to focus. Now even while autonomous platforms be subsurface surface or area, will have been -- are being and will be utilized in a large manner, larger, let's say, larger focus. The conventional platforms would continue to remain because these conventional platforms, one, they provide heavy-duty muscle in terms of armament. Second, they have huge endurance, sometimes endurance to stay more than 3 months in FC. So these conventional platforms would continue to, in my application and as an experienced interations, conventional platforms of all ranges first vessel or be it an aircraft carrier or be it a conventional or strategic submarine with trust and their existence will continue to remain. So coming to GRSE, GRSE had and had ventured into the autonomous field as late as 3.5 years back. And we staff in all 3 dimensions that I mentioned, both the subsea and [indiscernible]. We have successfully developed both the subsea and the surface versions. And just to inform you that one of our products has been supplied to provider to one of the DR opiates. We see opportunities here, and we are an integral big and make one and make 2 schemes which the government has promoted in a few cases where the autonomous underwater as we are very much in the way. And in the next year, since you asked me what can be the short term and what can be envisage in the next 5 years. In the short term, what we have developed, we see them gaining let us say, more standing in the domestic market. And in the long term, that is 3 to 5 years, we see the make projects for the -- that is the extra large autonomous underwater as well [indiscernible] to take shape. And perhaps in the next 3 to 5 years, we should be able to develop and deliver this project to the customers. So it is moving in the right direction. And as with many of the different manufacturers of India, we have a separate business vertical on a new technology. So we are focusing on autonomous platforms and in the next 3 to 5 years, we see gathering for the momentum.

Next question is from the line of Harshit Kapadia from Elara Capital.

Congrats for a very good set of results. A few questions from my side. So first, could you please give us the order book breakup, which you generally give across the ship? That's my first question.

Sure. Thank you, Mr. Harshit. The order book peaked up. As I mentioned, our total order value order book value is INR 15,324 crores and about 95% continues to come from shipbuilding. So the shipbuilding out of to the tune of around [indiscernible]. And within shipbuilding, the P-17 Alpha project has about INR 5,868 crores remaining. -- and digital craft INR 2,035 crores, and the next generation now should preclude INR 3,168 crores. So the warship building orders to the tune of around INR 11,361 crores. Coming to the nondefense segment. The ocean defers resent INR 749 crores, [indiscernible] vessels, 2 of them, we are doing INR 260 crores. Acquisitor shipped INR 56 crores practice hyper INR 207 crores, the multiples versus INR 1,345 crores and the dredger about INR 66 crores remaining. So what is interesting is that the nondefense segment, now we have about 22.5% of our total order book.

Understood, sir. Understood. So my second question is, sir, when -- on the 31st of March when you reported your provision revenue figures and on the result at when you gave out the numbers of revenue, there was a huge delta, it was very positive, of course. But what would be the reason for this difference, sir, if you can explain? Because generally, historically, we haven't seen a huge difference between the provision number and the actual revenue figure, sir?

Okay, very interesting. Are you happy or not happy?

Of course, very happy, sir.

Okay. Since you're happy, we had -- I'm sure you are keeping track of our progress at Pacifica milestone. A couple of ships, not a couple. Pre ships were delivered on the last day. So this -- the revenue recognition, the list the Navy, all these aspects are going on. That is the reason why we went for a conservative figure. So when all this happened, then when we formalize the deliveries and they hand it over the business, the revenue appropriately, I mean realized from the ships and the total revenue now comes to our best figures of INR 7,002 crores.

Understood, sir. Sir, a follow-up question is, sir, on the NGC order. If you remember, sir, the last time when we met, you were very confident that probably will be getting this order in the month of March 2026. But today, also, you mentioned that price negotiations are going on, you're expecting the order to come soon. So where is the hiccup, sir? Where is the delay? And by when do you think the NGC orders would come. In addition to this, you also highlighted certain smaller projects like 22 water gates and other smaller size projects. Now are they -- there are 2 winners or it will be a single winner if you can highlight?

Okay. First thing, I would like to clarify that the price negotiations are completed. Actually, when we acted at that stage, effect the price negotiations were completed. They are they have been completed. We were expecting the contract to be assigned by 31st March [indiscernible] because at that point of time, the contract negotiations, the terms and conditions, those aspects were in the optimistically appreciated that it will get completed by the 31st March. Our current assessment is that the contract could be signed -- would be signed during the current quarter that -- it is a trend direction, no reflects so far coming to smaller projects, which you mentioned. The first project of multiple poles send shipyard. There's only 2 ships that project for cost at prices again as intend the intent again is a single shipper. But the other projects, the 120 [indiscernible] travel. The faster aircraft -- fastener subtract 120. It will be split between [indiscernible]. That is an RFP condition, and like RFP conditions. And the second project, the P-17 Bravo again, would be split between 2 shippers but [indiscernible] the current palaces. The mine comes [indiscernible] would be split between 2 [indiscernible] and the landing platform dock [indiscernible]. But these 2, the last 2 projects, which I mentioned is some time off because I expect the RFPs to come out Sunday during the latter half of the current financial. I think that gives you a broad perspective of orders in hand, including the breakup plan.

Next question is from the line of [ Bahavia Gandhi ] from Bajaj Alternative Investment Management Limited. Please proceed.

Sir, my first question is regarding when can we see the revenue booking for NGC starting. And in the intermittent period, you were supposed to have smaller ships where you could contribute to the revenue. So if you can throw some light, how will the revenue numbers look like for the next 2 years?

Thank you. The revenue booking from NGC, if the contract is signed during the current quarter, we expect the bookings to happen during the latter half of the next financial year, that is FY 28, the second half of FY '28, we expect the revenue generation from NGC to commence.

[indiscernible] can just elaborate how much would be the percentage booking percentage? Percentage booking wise for the first 2 years, at least?

See, [indiscernible] asking about NGC?

NGC, yes. NGC in particular.

Okay. So see, you are aware -- I mean, since we have been impacting over multiple investor analyst meet. But in follows [indiscernible] and so, which means the initial phase when the proprietary activities for construction are in progress. The revenue recognition is minimal. Then it picks up as the typical construction starts in terms of block fabrication, the health application, where the steel and certain outfit items get into the platform. Then come to the next phase where the steeper phase where the equipment get lower. And I said there around 65% of the cost is then the [indiscernible] and peso moving towards the delivery and once deliver the balance [indiscernible]. So considering the prospect in the first year, yes. Again, we are signing the -- actually what we are sending to contract in the first quarter. We don't plan early revenue recognition during the current year or even in the next half. The next part, what I mentioned to comment some recognition that a very media carbon, which is coming from the design inputs, which lead to the -- getting the ship ready for construction. The major chunk of the revenue recognition will start from FY '29, then how construction nature and the equipment some -- at least some part of the equipment currency. So this is what I think at this point. Now currently, we have, as I mentioned, we have about 39 platforms under construction. And again, as what I stated during this very interaction that few of these vessels are in a mature state where the production progress is very good after the construction time. So we expect that revenue approval during the current financial is going to be very healthy and in line with what we have been seeing during the last 3 or 4 years. And for the next year, for FY '28, with the balanced projects, what are in hand, the NPPV project, refers vessels and the commercial business that we have in hand. And of course, we also expect a reasonable amount of orders which are on the and coming. So naturally, the order book deficit currently will be stand up by NGP 1 and at least 20%, 25% of the balance, [indiscernible].

Sir, can you reasonably assume that FY '28 will not see dip in terms of revenue because that's a fair understanding?

No, I do not state that. And [indiscernible] is that by revenue by FY '27, look the current financial year, a couple of more projects would get completed, and the remaining projects would give us revenue during the next year FY '28.

Okay. And sir, during these 2 years, how should one look at -- because you've been guiding for high-digit EBITDA margin, while NTT will be in the design phase. So there will be some sort of de-operating leverage also because your fixed costs will continue to remain elevated. So if you can guide for at least '28, '29, how the EBITDA margin will look like beyond '27?

Okay. In case of FY '28 and '29, we will try and maintain similar markets. I can only say we'll try and maintain similar margins because at that point of time, the balance projects which are currently in hand. I'm talking about the OPV project or be it the commercial research vessel projects they would be getting competitive. So we will try and maintain similar margins during that year also. And also, one second, also in FY '28 and '29, '28, the engine would start giving us revenue. Perhaps maybe to the tune of around 3% to 4% to 5% of the overall project cost, which is substantial. And the next year would -- when the construction start, again, the project will start giving revenue. And I also mentioned that what is coming from NGC in the next financial year, second half. In the balance of the projects which are on the anvil, let us take the P-17 driver where there are only asset now, again, like the NGC, there are only 4 shippers. And with our kind of experience and expertise in building these vessels we stand a very good chance of filing and order even if you go by a conservative DRC becoming last contract a similar pattern exactly from the time it completed. The revenue resignation from [indiscernible] commence in FY '29. So the deficit of the gap at this moment is not a concern, not a great concern. This is my [indiscernible].

Next question is from the line of [ Ashish Kura ] from Antique Stockbroking.

Yes. This is Sanjeev here. So my question is regarding the margins. So we've done very good margins in FY [Technical Difficulty]. So for the future, should we kind of adjust for you back that we were seeing every good to really look at the sustainable margins for the future, which could be around 9% to 10%?

Sorry, Mr. Ashish, could you repeat the question, please so your voice or turning a bit distorted. Could you please repeat the question?

Yes. Sir, what I was saying was that we did 8.3% EBITDA margin in FY '25, right? Sir, what I was saying was that we did 8.3% EBITDA margin in FY '25 and then 11.6% in FY '26. Now if we look to maintain margins then should we adjust for the decent that we received from the write-back that we took in the fourth quarter of FY '26 and FY '26. Is that the right way to look at how the margins will pan out for the next few years?

All I can say, frankly, the question was not clear. Purely not because of the [indiscernible] properly, the voice is a bit distorted. But what I understand is you are asking about the EBITDA margin trend what to continue in the current financial year. I can assure you that the current financial year, the margins are going to be similar. That's what I understand you asked because it's not clear.

I was asking that is just for the benefit that we took on account of the provision write-back in the fourth quarter of FY '25 and FY '26, sustainable margins are around maybe 9.5% to 10%. So that is the way [indiscernible] should the work out for the future? Or we should go by the current level of around 11.5% margin that we did in FY [ '24? ]

We will be able to maintain a similar margin what you said last, we'll be able to maintain similar margins in the coming year versus the current year.

That is 11%? 11.5%?

That is point, I really can't say I expect, all I can say at this [indiscernible] are only in the first quarter. [indiscernible] say is that we'll be able to maintain a similar margin.

Next question is from the line of Raj Shah from ENAM.

Sir, my first question is in possibility of revenues in '28 under the aftermarket space. As for the platform that we have delivered in the last 2, 3 years, say, survey vessels in the earlier previous that we have delivered. Do you see that spread revenue start growing up, say, next 2 years, which could be the to increase margins?

No, you're mentioning that ships delivered during the last 2 years. What is the question?

Yes. So for the ship that has been delivered in the last 2 to 3 years, will the spare sales for those ships start reporting our number in the next 2, 3 years? Which would be a reramp of margin of [indiscernible]?

[indiscernible] That's okay. I'll tell you this way that last 2 years, recipe, which were delivered. One of course is the Pampa project, we have delivered 2 of the ships, then verses we delivered 4 of them in the last year and the test 2 years. And some of the segments [indiscernible] projects. All of these projects are high-value projects and all the orders for this equipment for the spares and equipment were placed much earlier. And these prices were fixed. So we did not find any escalation something or any impact. So the margins are intact. They have not been affected by any of the market fluctuations. So I think that is -- I'm not sure that, that's the question which you asked for it is not clear. But we have been able to maintain good margins from these 3 projects.

Okay. Okay. Sir, regarding this export market, do you see any new orders that we are eyeing up on any possibility of orders that are coming in the next year?

Yes, definitely, yes. Definitely, yes, because most of the European shipowners are now looking at India because of 2 reasons. One, there standard destination that is China, Korea that jampacked with orders. So that is one way. And then the second [indiscernible] that the form that the Indian pricing is affordable for them. and competitive for them and so is the quality of the losses. So a few of the European clients are in dialogue with us. And we I'm very confident that in the next were also wish be able to conclude more contracts commercial assets, especially from the European market. So we see opportunity in this segment.

Next question is from the line of [ Kash Parik ] from 361 Capital.

You did highlight that the order for NGC could be signed sometime in this quarter. Could you also share more details on the likely vendor ecosystem for the project, including the potential key suppliers and their respective shares?

Okay. Yes, we are expecting the order for the contracts for the nut the current quarter. And for the next project that is [indiscernible] the 17 Bravo projects, we expect the RFPs to come out in the next 3 months. Also, I had mentioned that 3 of the bids are currently like the NPV which submission has already taken place. And so the OPV for the coaster and the interceptor boats as appreciated a bit submission towards the end of this month or early next month. So consecutive time if we take for the smaller projects from the time the bid is opened the contract would get signed within 6 months. And for the large project like [indiscernible], is now experience with NGC could take up to a year, [indiscernible].

So what I was trying to understand is specific to the NGC program, who would be the key vendors for you for the project. And it would also be helpful if you could share the electronics content in the overall program, so what proportion of the program value could be attributable to electronics and which major system foods [indiscernible].

Understood. You are specifically asking about the NGC project with respect to our downstream vendors and in the NGC project, about 65% of the overall project cost is for the equipment and systems. And of this 65%, approximately about 55% to 60% is accorded by the electronics. There is a weapon sensors and associated electronic. And the balance that is around 45% to -- 40% to 45% comes from the machinery and systems that is like the total engine, the air conditioning plant and associated masonry systems and also the steel visits. So the electronics a large tent of electronics, of course, comes from sister-store and since the field is competitive, there are a few other Indian OEMs who are in the same. Does it answer your question or you want more information? We have contribution -- we already started discussions with several of the OEMs as part of the preparation for the project. And once the contract is signed, we will be placing the downstream orders. So we expect the first half the outstream models we place within 3 months of signing of the contract and between 3 to 6 here, the customer is also involved. Since it is a big project, the pendency project. The customer is also associated when the technical fictions are finding. So the majority of the orders will be raised between 3 to 6 months of signing of contracts.

In terms of given that, like you said, [indiscernible] will also have a role in this program, fair was that once you were able to sign the contract the customer, the contract in signed somewhere around 3 to 5 months till 6 months or after you all contract signing with the customer. Is that a fair assumption?

Absolutely.

Next question is from the line of Harsh Mulchandani from Toro Wealth Managers LLP.

Sir, you meant to discuss that right now, we are seeing good momentum even we have inquiries from the European companies because of our pricing advantage. So do we have enough capacities to take large orders from them? And is there a possibility to aim for even higher margins than what we have seen in the current year, which is obviously very good. But because we are globally competitive and we have good quality also. Can we position ourselves as a higher margin player also going forward from the company perspective?

Yes, the opportunities are good. The current projects we have taken because we wanted an entry into the commercial shipbuilding segment. So when we follow this current order with more orders to fit going for projects with higher margin and perhaps look more orders. Just to give you a perspective, the project what we have taken on as multipurpose vessel which medium size why we state the order value remaining at INR 1,400 crores, INR 1,500 crores. If you just take any of the naval projects, be it a [indiscernible], there are those ships are very small ships, but [indiscernible] and the cost per ship is around INR 75 crores. So it almost comes to around [ INR 5,000 crores, INR 5,500 ] crores. So what I'm trying to convey is that while the commercial shipbuilding export market looks attractive, the money and the margins are very much the possibility. So what I have stated in the beginning of this discussion that about [indiscernible] or the growth of RFPs, which are on the handle. So there is enough in that segment to meet the order book or profitability aspirations of the company. However, the commercial shipbuilding projects, which are on the -- what we will be looking for is something that we see with good margin projects which are attractive, like, say, hybrid platforms or large face complex proportions, which are challenging as well as attractive -- to answer your question nutshell, yes, we'll be going into commercial building projects. We can see 3 of them coming up in the next year or so. with assay group margins. Otherwise, we would not be far any projects at low margins, especially when we are concerned with commercial shipping and export orders.

And just one more question. I had to understand now with the commodities prices increasing, et cetera. So I'm assuming you would have an arrangement with the clients for cost pass-through. But I just wanted to get a sense that -- how -- is there any delays in general that we see with respect to these cost pass-ons -- or it is these negotiations happen simultaneously on a monthly basis, how does it work on ground?

Thank you. Yes, there is a deviation or the expiration with respect to the cost of commodities, there has been an impact -- and so has there been an impact with respective type. So coming to the cost factor, all the projects that we're currently executing. We have factored this and orders were placed much earlier. So there's no cost escalation in the prospective the existing orders that we have for the ongoing projects. The time delays are marginal because what we have seen is that were minor delays prospect steel or the industrial gas, which contribute towards fabrication within the businesses. Yes, there is a marginal -- where is the margin a significant impact this year going to absorb in the overall scheme of to all the new contracts, which we are yet to find or where we are bidding. We will factor this aspect of uncertainty also. In the existing contracts, just to say all the contracts are fixed place contract and so are our orders with our subcontractors or vendors. So there is no impact [indiscernible].

Next question is from the line of [ Rahul Dasani ] from MPL.

Yes, go ahead. I have a specific question regarding the ASW vessels. Are we still left with some equipment fitment on our vessels, the ones that we have commercialized, especially as I believe without complete fitment post delivery we don't get the PBS amount back, which I believe some 10%. And from what I know, we were left with the [indiscernible] installment.

Can you repeat, please? I didn't get the question. Which project?

[indiscernible] The few that we have commercialized and data in the water as of date. I believe that without fitment of all the equipment on it, usually, the government doesn't give us the PBCS amount, which is usually 10% of the whole tender, if I'm not wrong. And from what I know, we were left with the installment of the sonars on that -- on those vessels.

Okay. Just since you asked a specific question, I'll can give a very clear answer. The stage payments for the table projects as per the day were different acquisition procedure are absolutely clear. We are about in 15 stages of payment with the 14 states coming at the time of delivery and the 15th stator the final state coming after 1 year of D. And to answer your question with respect to Sona, there are 2 types of our industry One is the son of hounded solar, which have been installed and the variable [indiscernible] impacted by the nonavailability or availability of that item. What I'm trying to say, there is no financial impact with respect to the bank R&D or PDA performance time guarantee.

Got it. That's very clear. And from what I understand, it's in the development phase, maybe and we haven't installed it yet. And hence, but there is still no financial liability or anything, right?

Absolutely.

Got it. And with the upcoming NGC and the NGOPV, do they also have a similar solar profile to the ASW both surface as well as underwater solar.

This is confidential information. You are asking me a recon fit of are platform -- you like to approach.

Got it. But maybe if you can share at what stage development, is this solar that we have to still work on? Or do we see that [indiscernible]?

This particular question, I would suggest you get a figure which is [indiscernible].

Next question is from the line of Sunil Shah from [indiscernible].

Sir, I missed a few points early on. And what I understand is that the P-17 Bravo is broken between 4 and 7. There are other 2 big ticket size orders which you mentioned, the INR 30,000 crores and the INR 35,000 crores. I believe those order announcements could be scheduled in FY '28. Sir, the order and the breakup, could you kindly just repeat it for me?

Thank you, Mr. Shah. [indiscernible] ships is -- and as per the AOM accorded by the difference acquisition counts this is the open source information. The project will be split between 2 severe that is fair and 1 will get 4 and the. Coming to the next 2 projects, that is the mine [indiscernible] and it will be split between 2 shipyards for an are getting 2 sit coming to the LPD project order as my memory goes, it is around INR 35,000 crores, and it will be 2 plus 2. These are the big [indiscernible].

Right. And this could be expected by FY '28. So sir, my context is with your tenure. So would we all hear this games whenever it if from your kind sales in FY '28 itself? Or how does it work? I just want to know that, sir.

First answer, been you may have to ask again. With respect, we expect the RFP for P-17 have to come out in the current quarter. And the other 2 projects would come by end of the financial year. So if the RFP for the brine comes by first quarter when the contract could be spent as early as end of the current next year invites and the other 2 projects in the next financial year.

Yes. Sir, about your tenure in the organization, sir, more than the orders. So you are there in the central year as well as the next financial year? Or the pattern would be for [indiscernible]? That's my question.

[indiscernible].

Sir, your growth in the organization. So you will be associated with Garden feed even in FY '27 and in FY '28 as well?

Yes, definitely.

Ladies and gentlemen, we will take this as a last question for the day. I now hand the conference over to the management for the closing comments.

Thank you, and thank you, Concept for arranging this conference. It is an interesting special, and we had a few interesting queries during the question and answer. We look forward to the investors and analysts may and looking forward to interacting with you all after we announced the results for the next -- Q1 FY '27. Thank you.

Thank you, sir. On behalf of Garden Reach Shipbuilders & Engineers Limited, that concludes this conference. Thank you all for joining us, and you may now disconnect your lines.