Genus Power Infrastructures Limited (530343) Earnings Call Transcript & Summary

Ladies and gentlemen, good day, and welcome to the Genus Power Infrastructures Limited Q4 and FY '20 Earnings Conference Call. This conference call may contain forward-looking statements about the company, which are based on the beliefs, opinions and expectations of the company as of the date of this call. These statements are not the guarantees of future performance and involve risks and uncertainties that are difficult to predict. [Operator Instructions] Please note that this conference is being recorded. I now hand the conference over to Mr. Kailash Agarwal, Vice Chairman of Genus Power Infrastructures Limited. Thank you, and over to you, Mr. Agarwal.

Thank you. Good evening, ladies and gentlemen. A very warm welcome to the Q4 and FY '20 earning call of Genus Power. First of all, I hope that all of you and your loved ones are safe and healthy and are taking utmost care of yourselves. Along with me on this call is Mr. Jitendra Agarwal, who is the Managing Director; and SGA, our Investor Relation Adviser. The results and investor presentations are uploaded on the stock exchange and company website. I hope everybody has had a chance to look at it. Ladies and gentlemen, due to COVID-19 pandemic, the resultant lockdown, the company's operations were suspended from March 22, 2020. This impacted the company's performance in Q4 FY '20 as it resulted in delay in dispatches of finished goods and therefore, revenue recognition. We have recorded sales of INR 1,060 crores for FY '20 as compared to INR 1,056 crores in FY '19. For quarter ending March 31, 2020, we have recorded sales of INR 248 crores as compared to INR 302 crores in quarter 4 FY '19 because of this operation suspension after March 22. Our EBITDA for FY '20 stood at INR 173 crores as compared to INR 128 crores for FY '19, a growth of 35% on Y-o-Y basis. For Q4 FY '20, EBITDA stood at INR 41 crores as compared to INR 37 crores in Q4 of last fiscal year, a growth of around 10%. For FY '20, our EBITDA margin has expanded by 417 basis points to 16.3% from 12.1%. Similarly, for Q4 FY '20, our margins has expanded by 421 bps to 16.6% from 12.4% of Q4 FY '19. The margin expansion was on account of higher share of export orders, better product mix, benign raw material prices and improvement in operating efficiency. Profit after tax stood at INR 94 crores for FY '20 as compared to INR 72 crores FY '19, a growth of approximately 29% on Y-o-Y basis. For Q4 FY '20, profit after tax stood at INR 22.4 crores as against INR 22.6 crores recorded in quarter 4 FY '19. The current order book of the company is INR 943 crores, which gives us a healthy visibility for growth over the next 3 to 4 quarters. Our order inflow has remained subdued in financial year '20 as state electricity boards are in transition phase to draw out the detailed rollout procession, shifting procurement from conventional meters to smart meters. There is likely to be no significant impact on the demand side due to COVID-19 as the state and central governments are persistently striving for reforms in the power sector, with focus on reducing aggregate technical and commercial losses by installation of smart meters. However, considering the COVID-19 led situation is still fluid and is changing dramatically, it would be too early to predict the exact implications of the same in the short-term to medium-term on the metering business. The revenue and profitability of the company are likely to be adversely affected by -- for Q1 FY '21 as our operations have only partially resumed in May 2020, leading to loss of revenue and operating leverages. With Ujwal DISCOM Assurance Yojana, UDAY, we all know about UDAY, getting expired in March 2020, the government is considering another reform scheme, which they have already announced and they are bringing that named as Atal Distribution System Improvement Yojana, ADITYA, aimed at investing funds in network infrastructure like smart meters. ADITYA scheme primarily involves the implementation of compulsory prepaid smart meters of -- for 250 million households with an aim on lowering AT&C losses of DISCOMs to 12%. And it's designed to date, the scheme is planned to install smart meters in the first phase, starting from electricity feeders and the reaching -- and then reaching to the consumers. The new scheme is likely to have central funding of up to INR 1.1 trillion, approximately USD 16.3 billion, over 3 phase -- 3 phases and remaining balance of INR 2.9 trillion, around USD 42.5 billion, will be funded by states. So huge amount, you can see that, it is under that. Thus, we foresee a lot of traction in our business going forward. The proposed Electricity Bill 2020 may also usher in a major distribution reforms. However, at the same time, these reforms measures may get delayed if COVID-19 sustains over a long period of time. The distribution sector is the weakest link in the entire power value chain and greatly affects power generation companies. Therefore, a lot of thrust is coming from the central government for deployment of smart meters across India in order to lower the AT&C losses, improve billing efficiencies, reduce DISCOMs' financial woes, and hence, consumer convenience and rationalized power consumption. SEB are also propelled to take action in this direction, as improving billing efficiency has become a necessary condition for receiving funding. Government is in the process of drafting standard bidding document and outlining the terms and conditions for deployment of smart meters across India. Prequalification criteria is likely to become very stringent to facilitate the entry of only quality companies having robust execution track record. The demand is now likely to increasingly shift from conventional meters to smart meters. We are very confident of sustaining our margins going ahead as product mix changes in favor of smart meters. After considering -- our working capital cycle is likely to remain stretched, but that is also -- we hope that will be a little improved as the government is working on paying their dues to their suppliers and all. At the same time, smart meters have proved their worth during lockdown as it has helped curtail the losses of DISCOMs that had adopted them. For example, in Uttar Pradesh, 95% of smart meter consumers have been billed during the lockdown, as against just 29% for the rest. Smart meters helped DISCOMs in handling the COVID-19-led crisis effectively by enabling auto collection of meters' reading over the year, reducing the need for manual intervention, remote connect, disconnect, enabling digital payments of bills. The DISCOM using smart meters have seen 15% to 20% average increase in monthly revenue per consumer. According to the EESL showcasing a wide between smart meters users and otherwise, highlighting their remarkable efficiency. Thus, installation of smart meters are directly linked to improving the financial health of DISCOMs. We have continued to focus on technology upgradation and operational efficiency to serve our long-lasting relationship with our clients, which has engraved our leadership position. In smart meters, company will also have a lot of opportunity in terms of recurring revenue as facility management system will also be part of the contract. We, as a company, are specifically target recurring revenue as an avenue for sustaining our growth. We also plan to provide our domain-related software to our clients. I now welcome -- open line for the question and answers.

[Operator Instructions] The first question is from the line of Samir Rachh from Nippon India Mutual Fund.

Congratulations on good numbers, despite tough times. Sir, I had 2 questions. One, in your opening remarks, you said that you expect huge demand for smart meters. And you also expect that criteria will become more stringent. It means there's going to be a great amount of opportunities. So currently, what was our utilization for FY '20? And going ahead what kind of expansion plans you have? That's my question number one. And my second question is, if you can give some rough idea of what was our market share during the last financial year in the smart meter segment?

I will take up this question. This is Jitendra Agarwal. First question is, what was the capacity utilization in the last financial year? Do we plan any expansion?

Yes.

As we have been telling in the past also, smart meters or this electricity meters being a custom-build product, the capacity enhancement can be very well planned and can be done very fast without much investment in the capital. And we have already planned a lot of -- today, comfortably, Genus can produce 15 million meters without any problem. So that kind of plant machinery investments has already been done. And if we say, what was the capacity utilization last year, it was around 70%, 75%. The reason I say 70%, 75%, being a custom-build product, if I have to make a same kind of product, it can be easily done much more numbers. But because we do a lot of product mix, capacity can be turned in a very different way. So I don't know how much I'm able to answer your question. Your question number 2, when it comes to market share for smart meter in last financial year, if we talk of only the last financial year, 80% of the smart meters in India were of Genus. So that doesn't say that we have 80%, 85% market share in the country in the times to come. I don't want to give any wrong understanding also. But if we talk of only the last financial year, this is the number, if you talk of exact number.

Right. And sir, if you can give a little bit of what is your view on the outlook for the current financial year? Because we would have already like lost sales in the month of April and some sales in the month of May. So overall, are you confident that we'll be able to maintain at least last year's numbers?

I am pretty confident that we will be able to maintain the last year number because in our industry, ramping up is not very difficult, if you have the right product mix with you. So that is one major reason I feel that we will be able to -- well, I'm pretty confident as of today. But nobody knows the future, which is absolutely uncertain right now. But as on today, I'm pretty confident that we will be able to do the last year number.

So I will add, Mr. Samir, in that, that when we were -- you were talking about the capacities and all, so we have sufficient capacities right now. We have recently, 2 years back, we have built up a capacity of Guwahati, that's almost free right now. So we have sufficient capacities for next 2, 3 years business, whatever the business will be coming. So we are not looking for any CapEx, just a routine CapEx, whichever is the routine CapEx. So I think you are more concerned about of the company's CapEx and all when so much of business is coming. So that is the answer to that. And regarding your answer to that, this financial year, basically, even in first quarter also, we will be doing around 40%. It's not a totally washed out quarter. We are pretty confident that we will not be degrowing. We -- there might be a small growth there, but degrowing won't be there, provided there is no further shocks coming.

Yes, yes. And sir, last question from my side. We have investment of around INR 255 crores as of 2000 -- March 2020. So what is the breakup of that? And anything from that investment which we can unlock and...

Can you come again?

Sir, our investment as of March '20 is around INR 255 crores from the balance sheet number, which you have disclosed. [Foreign Language]

It's -- basically, it's more of a liquid investment. Around INR 180 crores, INR 185 crores is a liquid investment that is mainly in bonds and FDs and other things and all. So if you see that, basically, if you calculate, our net debt is almost INR 30 crores, INR 40 crores only. So all that investment, you see that a total of INR 250 crores is mainly liquid, INR 170 crores, INR 175 crores and some is trust, which holds the share of Genus Power and Genus Paper.

So what is the plan with that share, sir?

Right now, there is no plan because basically company is not needing any money right now. So in future, if any requirement of the money comes, then we will see.

The next question is from the line of Vikram Kotak from Crest Capital.

I have many questions. So maybe I'll start kind of asking a couple of them. And if moderator wants to kind of bring back me in a queue, he can bring back. Like Samir asked, Agarwal ji, my first question is that you said about the doing almost same turnover next year. But I remember in last quarter con call, you were a little worried about the collections, and you rightly worried about at that time about collections and you're not taking the new orders unless you have surety on the payment from the DISCOMs or your counterparts. What's the scenario there now? That's question number one.

Jitendra, better you answer it. Yes, yes.

So we have been very clear last whole financial year on picking up the orders. The 2 things were kept in mind, very clearly, of course, payment situation of the electricity board because we are in a very, very bad shape when it comes to working capital cycle, we all understand that. And second was on the product mix. That is the reason you will see last financial year, the bottom line of the company has done very well. So that has been done with a very clear process being made internally, yes, how do we want to focus on the business. Same thing for this financial year also we will continue because our order book, I won't say it is very good, INR 950 crore, but it is not that bad also that we need to be very, very crazily doing something. So this, we will keep in mind for this financial year also.

I add to this that basically, your question was about the payment cycles and all. The orders, which -- the order book, which we are there is, basically, as we were choosy or you can say we were selective about the orders and all, so the cycle is better for these orders, number one. And number two, the government is now -- the state governments and central government are aggressively, because of this COVID-19, are working to pay their vendors. They very well understand that if they pay the money for the economy, the money has to come in the system. So we personally feel that it will be a better payment from central or state governments probably.

Going forward.

Going forward, yes.

And the add-on question to this is the order book, which you mentioned INR 950-approximately crores. How much is the order is likely to come in next quarter? So I know everything is right now standstill because of COVID. But what's your expectation? And how do you see that -- how many L1s and -- yes.

Yes. Just to give you a little idea about that as on today, there are only INR 640 crores of tenders being quoted. This tender would have been almost INR 1,500 crores if COVID situation would not have come. But most of the electricity boards, generally, tenders come in Jan, Feb, March and they get decided in April, May, June, July. That has been historically the reality of the DISCOMs. So that has been delayed by 2 to 3 months. So to be quoted, we already have around INR 1,400 crores of tenders, which will be quoted in the next couple of months. The first 2, 3 months, for sure, June, July, August, there will be a very low traction when it comes to order booking also. But by the end of October or maybe starting of November, I am very confident that things will be very, very healthy.

So basically, it's a delay by 3 months. And we are comfortable for the whole year. The order book right now I have is comfortable for the whole year. So even if the order comes in August or November is not making any difference to the company. There might be, when I give results, I say that my order book is INR 1,100 crores or INR 800 crores, that might be the question. But otherwise, it is not affecting anything to the company, whether it is coming in August or November.

Yes, even if urgency from government side to give the orders, it's not only you have to worry about orders, in fact, there will be more push in second half to give the more orders, right?

Yes. Yes, correct.

So because electricity meter is a necessity.

Very true, very true. Sir, my third question is what Samir asked, and I'll repeat the question that why so much of cash balance or liquid balance you want to keep it? Just because of COVID situation or rather you want to repay a little bit because arbitrage will be very negative because your liquid fund return and FDs will be very, very low versus your borrowing cost? So why -- what's the reason of keeping large amount in liquid and FD right now? Is it because of COVID and...

Basically, the type of business we are in, where the working capital cycle is very big. So we have to keep always emergency funds. So right now, because of COVID, we have improved that. Earlier our emergency funds were around INR 100 crores, INR 110 crores, we used to keep. We have increased that by another 10% just because of -- of the total revenues, just because of this situation of COVID and all. Because our business is, again, a long working capital cycle business and all government business. So we have to be very cautious about that, the liquidity and all that.

Right, right. And the next question is that what is the change for you as at Genus -- at Genus that pre-COVID, post-COVID in terms of manpower, in terms of business process, in terms of improving the hygiene or whatever, I'm just -- just a general question that what's changed for you from COVID -- pre-COVID to post COVID in terms of cost and manpower and processes?

Pre-COVID to post-COVID, definitely, there have been a lot of changes. And there are a lot of general things that have been taken care, of course, which we call as the hygiene for the office, for the company, the way we work, the way we meet the clients. The biggest advantage what I see, the clients have become much more available now online. So I personally feel the connect with the client has improved post COVID. That is my personal -- because as the MD of the company, I cannot travel all across the country every time, but nowadays, I've realized in last 80, 90 days the way I've connected with my -- most of the clients all across the country. So that way, I feel the connection has improved.

They have got the habit of coming online.

They have got the heck of coming online. So that was I see a positive sign of it. Cost-wise also, I think -- cost-wise also, time efficiency wise also, over the period of time, I think with the use of more and more digital platforms, we all will have better efficiency in the times to come. And there's always -- whenever you are running a company, some fat always gets created. That's a reality, which is -- for every company in the world. These kind of crises really teaches you how to cut the flap. So as a company, as an individual, I think these kind of crises gives a lot of positive backup to the company, a lot of positives comes in the system. And Genus as a company has already gone through one major crisis like this in 2009, and that was only for us, not for the world. Even from that crisis, when we came back, we were much more stronger and better company. So as an individual or as a company, I feel, yes, future will be more brighter.

Super. And last question -- sorry to keep everyone waiting, but last question from my side is on the margin outlook. I actually missed last quarter's margin because I didn't see the presentation, but what was the last quarter margin? And what's the view for next year? And again, I'm not asking for a very exact number, but roughly what you are seeing over a period of 2 years?

It was the same last quarter also. It was almost at the same levels. And coming years also, we feel that it will be at the same levels.

Okay. So you're not expecting any big pressure on the margin at all?

No, no. Not at all.

The next question is from the line of [ Lalit Garg from Global Investments ].

Sir, my question is on bookkeeping. There is -- in the consolidated statement, there is a INR 20 crore increase in the other expenses. Can you give me the breakup something what's been debited?

Actually, it is -- there is a trust, which is holding shares of Genus Paper and Genus Power. So this is the value of -- because the share market and all, the value of the Genus Paper, mainly the Genus Paper share has come down. This is that INR 20 crores. So it's just a virtual figure. It's nothing to -- and that goes in -- as per accounting, it goes to the other expenses.

So this is not the "below the bottom line" figure, this goes?

No, no, no, it's nothing to do with the "below the bottom line" figure. It is just our increase in share price of the shares held by the trust. So say, last quarter, Genus Paper was INR 8, and now it is INR 4. So INR 5 crores x INR 4 crores 20 crores, that comes to other expenses. Maybe next quarter, it is again go back to INR 20 crores back.

Sure. Sure. Sir, my second question would be, what is the quantum of sales that was affected in March, the number -- if you can give a rough estimate on the dispatch amount?

Shall I take this?

Yes, Jitendra you answer.

Yes, around INR 40 crores, INR 45 crore.

INR 40 crores, INR 45 crores. And sir, I see that, a follow-up question on this query, our inventory has gone down by around INR 55 crores. So this would have decreased our inventory furthermore or it was the production that was affected?

No, it is not that. Last year, the inventory level was a little higher. So these are the actual levels, real levels for the inventories.

The next question is from Keshav Garg from Counter Cycle Investments (sic) [ Counter Cyclical Investments ].

Sir, my question is that, sir, we have given guarantees of around INR 230 crores to some group companies. And last year, we also made investment in preference shares of some Yajur Commodities, et cetera. Sir, so because of all these small issues, sir, the market capitalization of company is suffering, sir. Had these transactions not been there, sir, market capitalization would be above INR 1,000 crores. So by spending some few crores, we are taking a huge hit on our market capitalization.

When it comes to corporate guarantees, that has already been reduced. And if you see last year's balance sheet, it has already been reduced from INR 230 crores to INR 120 crores. [Audio Gap] gone through that. And by end of this financial year, say, March 31, 2021, there will be no corporate guarantees. We have already started reducing the corporate guarantees. And in this balance sheet, for this financial year, it will be around INR 50 crores. And next financial year, it will be 0. So our company is already working on that, and we absolutely agree with you, and we are working on that.

Sir -- and also our bad debts are too big, sir. Last FY '20, they were INR 16 crores, which is approximately 10% of our EBITDA, but year before, it was 20% of our EBITDA, INR 24 crore bad debts. So I mean going forward, sir, how do you plan to avoid these...

These are not bad debts.

Basically, these are not bad debts.

There is no single rupee bad debt. These are liquidated damages, LDs, and some qualities, and there are so many things involved in that. So there is nothing -- no word bad debt is there.

Okay, okay. I got that, sir. Sir, and also our tax rate...

See the classification by the auditors, yes.

Sir, I got that. And sir, our tax rate is around 37% for FY '20. Last year, it was 28.5%. So we were expecting it to be below 25% since we have plants in Guwahati, et cetera?

No. Basically, last -- till last year, we were operating from Haridwar, which -- the main production was coming from Haridwar. There was a tax exemption there, which has expired in last financial year. So this year, the Guwahati production is just ramping up. There is a very small production from Guwahati. So we are in full tax regime.

Sir, so basically, we'll pay 25% tax?

No, no, we will pay 30 -- because we have a lot of MAT credit, we have -- the company has INR 45 crores of MAT credit. So if we go for that 25% thing, we cannot avail that MAT credit. So we are first availing our MAT credit. And once that is over, we will move to 25% regime.

Sir, so for FY '21, the tax rate would be how much?

For '21 also, the tax rate will be the normal tax rate. Because this year, we have almost exhausted our INR 25 crores of MAT. And next year also, we have remaining of around INR 20 crores, INR 22 crores. So that will also be exhausted by financial year '21. From '22, we will be in the normal tax rate -- 25% tax rate.

Okay, sir. And how much is gas meter of our total revenues? And sir, also, are you looking at exports in a big way, sir, to reduce our dependence on state electricity boards?

See, if you see our -- first, I will speak about the gas meter. The gas meter product, we have -- there's no revenue in last financial year. That is a very safety hazard product, so it needs a lot of certifications, which are primarily -- I mean these certifications are not from the Indian labs, unfortunately. So they take their own time. So we are very confident that by the end of this calendar year, we will have all the certifications done. And then we will have some better share of pie in the gas meter market. So that is my first answer.

Right now, we are doing a little pilot projects and all, small scale.

We are doing a couple of pilot projects, very small, just to establish the product. In that sense, we have done around 700, 800 meters with some customers. But that is very, very small to talk about. What was your next question?

Yes, sir. Sir, you were saying?

What was your second question?

Sir, I was asking, sir, that company made INR 134 crores of operating cash flow last year. And like you mentioned that our balance sheet is very strong. Sir, but still we skipped the dividend. So if you can consider a share buyback, sir, that might be the best option, sir, because we can extinguish our shares and reduce our equity share capital, so whatever future growth will come, it will get divided into a smaller base of share, EPS will increase. And sir, also the tax -- so basically, tax effectiveness or buyback is very good, sir, as compared to dividend, which is being tagged at 43%. Sir, in share buyback, it is just 23% and sir, there is no capital gain tax also.

Basically, it's -- see, right now because of the COVID, we are just working out how the liquidity situation will be there and how the things will move. Once the things will stabilize, certainly, we will take some decisions. The Board will -- the company will certainly take some decision in the favor of investors and all.

The next question is from the line of Manish Goyal from Enam Holdings.

Congratulations on very good set of numbers in current environment, sir. Sir, just a few questions. One on the -- as you mentioned, one of the reasons for improvement in margins was better revenue mix. So if you can just give a sense in terms of what was the export revenues in the current quarter and the current year as compared to previous year, number one. And number two, what was the increase in revenue contribution from the smart meters, which probably helped us? So if you can give us some sense on this. And in -- within order book, how is the export order book and smart meter order book?

Basically, last quarter -- fourth quarter, our export was INR 11 crores. And this -- it was -- this last quarter, quarter 4 of FY '20 is around INR 27 crores. So -- and for the full year, when I say for full year, last year was INR 64 crores, and this year, it is around INR 96 crores. So there is almost an increase of 50% from the last year. And when I say about the order book, right now, the order book for the export is around INR 50 crores.

Okay. And how is the pipeline, sir, for the exports order book, sir?

There are many inquiries going on across the globe. Primarily, it's 6, 7 countries where we have major focus. But definitely, there is a delay due to COVID. There's no doubt about it. A lot of traction has gone slow, which was happening. So it will take its own -- at least 2 to 3 months to get back to some normalcy, provided nothing grossly go wrong with the world.

Basically, company is fully focused on its export numbers. And if you see that from last financial year, we have grown around 50% this financial year. And we have same targets for the coming years also.

We have really opened up very, very good markets in last 3 to 4 years hard work, which is clearly visible in our numbers.

And that is staying right now.

Okay. But would it be possible to give a sense in terms of the size of the tenders or opportunity for us, which probably -- what kind of revenues we can look forward to in the next 2 to 3 years?

There are a lot of projects where we are working in the international market that are not tenders. So it is very difficult for me to define that, okay, this is a tender of such value. So they are primarily -- a lot of these -- they work like private companies, the way Torrent or Reliance works in India. A lot of these projects are happening not only with the government, with the distribution companies which is not necessarily owned by the government.

Sure. And sir, my second part of question was in terms of smart meter revenue mix, what is the contribution now? And how is the order book in smart meters of the total order book?

Currently, if you see the total order book, our smart meters orders are almost 65%. So we are primarily focusing on the smart meters as a company. So the current order book stands -- our smart meters have by far taken over the conventional meters in terms of our order book.

And this -- you mentioned that there was 650 -- INR 640 crores worth of tenders, which are already quoted. These were also for smart meter?

These are primarily for conventional meters, very few are for smart meters.

Okay. Okay. And with the rupee depreciation, sir -- you did say -- mention that EBITDA margins would be steady in the current year. But with rupee depreciation, do you see any impact going forward?

No, not in a big way. It's not a...

Not very big way because we expect that, that much we will try to cover up with our operational efficiency. And the focus we have specifically put on the smart meter side, that will help us.

[Operator Instructions] The next question is from Kartikeya Agarwal from Finbouquet.

Congratulations on reporting a great set of numbers. My question is that due to the recent government notification on the provision of having no global tenders up to INR 2,000 crores -- INR 200 crore turnover, so what is your view on the competitive landscape of the smart metering bidding process? And what would be your opinion on prepaid meters in this regard?

First of all, just to clarify all the people, prepaid meters and smart meters are not different. A smart meter can be prepaid and postpaid both. So whatever the Government of India is talking about is primarily, in smart meters, they want to configure them in the prepayment mode. All the smart meters across the globe can be postpaid and prepaid both because you have a 2-way communication. Second thing, you asked -- can you repeat your question, I'm sorry?

Yes. So recently, the government of India said that there would be no global tenders.

Yes. For the INR 200 crores. Generally, if you will see, the international bidding has happened primarily in the larger tenders only. Mainly EESL has been doing the global tender. [ Apart from them ] most of the domestic utilities anyway are not doing global tenders. So as such no international companies are bidding for it. So this INR 200 crores figure will definitely help in one way, but won't be a game changer.

The next question is from Abhishek Jain from BP Wealth.

Congratulations on good set of numbers in current environment. Sir, one question. I've read it somewhere, there has been delay in the Chandigarh smart metering project right now due to lockdown. Do you think this is going to impact because of the labor exodus [Technical Difficulty] in terms of getting the raw material also and in terms...

I'm sorry to interrupt you, Mr. Jain, but we can't hear you very clearly.

Because of the large-scale labor exodus that is happening right now, so what is the client -- are the clients taking supplies right now at this point of time? How are the logistics moving? First thing. Second question, sir, what is the utilization level. You must have told, but I was -- joined later in the call. Sir, any interaction with the government on the smart metering policy, any time line they have given, sir.

I could hear you very briefly, so I'll try to answer what I could understand. The last question is on the government interaction on the smart metering thing. So government has been showing a lot of seriousness on the smart metering, as you all know, and in the relief package announcement, our finance minister also specifically mentioned smart meters are the key to DISCOM reforms. So that speaks of itself how serious Government of India is about it. And just 3 days back, we had an interaction with the Power Minister, Government of India. Again, he emphasized the need of the smart meters. So there is a lot of traction, there's no doubt about it, all across the country. Apart from this traction, there will be a lot of traction because of the privatization which the Government of India has been talking about. They've already announced all the UTs getting privatized. So that will surely bring a lot of traction to smart meters and metering per se. Power Minister specifically mentioned in the call 2 days back to the industry that he had a chat with the Chief Minister of UP. And UP government is very serious on privatization of one of the utilities to start with. And when we say one of the utilities of UP getting privatized, it's as good as some of the states in the country in terms of numbers. So that way, there's a lot of traction happening. Even if you see that recent Electricity (Amendment) Act 2020, which was approved by the group of ministers in this 5th of June only and now it will go to -- further to cabinet for the further approval, which is already proposed to the cabinet for the approval. If that Electricity (Amendment) Act gets approved in the shape it is, it will have a huge impact on the DISCOMs of the country and very positive impact on our kind of business. What...

So what is -- and secondly, what is our utilization percentage in FY '20 on an overall basis?

Around 65%.

Utilization of what? 65%

Okay. And what is the percentage of smart meter share in the overall scheme of things, sir?

I'm unable to follow you at all.

Sir, what is the percentage of smart meters sold of overall meters sold?

I think I answered somebody before also. For last financial year, Genus' market share for smart meters is around 80%. But that is not any guideline.

Okay. And last question, sir, what I was asking is, there are a lot of companies -- a lot of projects have been halted because of labor exodus right now.

That is the news that came in Chandigarh. You must be talking about that?

Yes, yes.

Because they are unable to finalize the project management agency, such kind of news has come. Frankly speaking, I don't give any value to that.

The next question is from [ Lalit Garg from Global Investment ].

One more question on my -- sir, our sales are totally institutional or is there a retail part to it?

Institutional.

And so our complete outstandings are also with the institution?

Yes.

Yes.

Okay. So that's why there is no possibility of bad debt with them?

Yes.

[Operator Instructions] The next question is from Keshav Garg from Counter Cyclical Investments.

Sir, like you mentioned that we have 80% market share in smart meters, so who would be the remaining 20%? Which companies are prominent competitors over there?

20% meters in last -- I'm talking of the last financial year only, I'm repeating myself so that nobody gets confused that Genus has 80% market share for smart meters. Well, that is not going to be the reality in the future. So primarily Larsen & Toubro, Zen Electronics, Inesh Energy, there was a few companies and Landis+Gyr. So 2 major contributors to the other 20% in the country is Larsen & Toubro and Landis+Gyr.

Okay, sir. And sir, also, sir, our turnover, if you see, sir, it has been stagnant at around, sir, this INR 900 crores to INR 1,000 crores range since past 5 years. So when will we break out of this range of around INR 900 crores, INR 1,000 crores?

We expected to break out last year, but -- and this financial year. But due to corona, I think it will take 1 more year.

Okay, sir. And sir, in the first quarter, sir, will be breakeven at the PAT level?

For the?

First quarter, sir.

No, I don't think so, it's difficult.

No, I don't think so.

So sir, we'll be making a loss in the first quarter?

Yes.

Unfortunately, yes.

That was the last question in queue. I would now like to hand the conference back to Mr. Kailash Agarwal for closing comments.

Thank you, ladies and gentlemen. Thanks a lot, and we assure you that we will be doing more than whatever is expected by us. And this COVID situation, we don't see will hurt the company, and we will be doing -- we will be at least not degrowing this year, if not growth. Thank you very much.

Thank you, everybody. Thank you.

Thank you very much. On behalf of Genus Power Infrastructures Limited, that concludes this conference. Thank you for joining us. Ladies and gentlemen, you may now disconnect your lines.