GPT Infraprojects Limited ($533761)

Ladies and gentlemen, good day, and welcome to GPT Infraprojects Limited Q4 and FY '26 Earnings Con Call. [Operator Instructions]. Please note that this conference is being recorded. I now hand the conference over to Mr. Omkar Bagwe from MUFG Intime. Thank you, and over to you, sir.

Thanks, [ Ikra. ] Good morning, everyone. I welcome you all to the earnings conference call to discuss Q4 and FY '26 results of GPT Infraprojects Limited. On behalf of GPT Infraprojects Limited, I'm delighted to welcome you all to this call. Thank you for taking out the time to discuss our latest financial results and performance. To discuss our results, we have with us from the management, Mr. Atul Tantia, the Joint Managing Director and CFO. He will take you through the results, and then we will proceed to Q&A session. Before we proceed to the call, a small disclaimer. This conference may contain certain forward-looking statements about the company, which are based on the beliefs, opinions and expectations of the company as on date of this call. The actual results may differ materially. These statements are not guarantees of future performance and involve risks and uncertainties that are difficult to predict. A detailed safe harbor statement is also given on the company's investor presentation. Now I would like to hand the call over to Mr. Atul Tantia. Thank you, and over to you, sir. .

Thank you, Omkar. Good morning, everyone, and a warm welcome to the GPT Infraprojects Earnings Conference Call. for the fourth quarter and the financial year ended March 31, 2026. I hope you all have had the opportunity to go through our financial results and the investor presentation, which has been uploaded on our website as well as the website of the stock exchanges yesterday. First, I will briefly take you through the key highlights for the quarter and the full year. As intimated to you in the Q3 call, we had signed the SPA for purchase of an EPC signaling business based out of New Delhi, Alcon Builders and Engineers Private Limited at a cash concentration of INR 151.83 crores. This acquisition was -- is with an intent to merge the same with GPT Infra and provide a full-scale solution for the larger EPC contracts being tendered out by the railways. I'm happy to announce that this transaction was concluded during this quarter. Alcon is a well-established signaling -- EPC signaling contractor with over 30 years of execution experience. This acquisition provides GPT Infra, plug and play entry into a high growth and high-margin business vertical with strong entry barriers. It also complements our long-standing relationship of more than 4 decades with Indian Railways. Post the payment of the consideration to the erstwhile promoters, the shares were fully transferred and the company has become a wholly owned subsidiary, which set from January 1, 2026, and we have gained full operation and managerial control on Alcon. I thank all the intermediaries who helped us including this transaction smoothly and quite swiftly. This is indeed of feather in our cap that we have been able to do this transaction so fast. In the current Board meeting, the Board has also approved a draft scheme of amalgamation of Alcon with GPT and also 1 of our earlier erstwhile subsidiaries JU Highway Private Limited so as to fully integrate the business with the parent and also provide them the enhanced network and other credentials to bid for larger contracts. This merger is with the appointment date of April 1, 2026, and is expected to be committed in this financial year, subject to regulatory approvals. During the year, the company secured several prestigious contracts across the infrastructure and railway segments. We achieved our highest ever annual order inflow of INR 2,422 crores, surpassing our projections of INR 2,000 crores for the year. Our total order book stands at INR 4,476 crores, which is approximately 3.5x our FY '26 revenues. The order book has grown at a CAGR of almost 21.6% from FY '20 -- the last 4 years. The order book remains quite well diversified across railways, bridges, roads, flyovers and allied infrastructure sectors which are the core infrastructure for the government. Key auto wins includes INR 1,201 crore order from Northern Railway for construction of a rail cum road bridge over River Ganga at Varanasi in which we have a 40% share, balance being with RVNL. Our share works out to INR 41 crores. Another order is INR 1,805 crores from MCGM in Mumbai for construction of flyovers along LBS Mall. This order is in JV and our share is 26%, that is INR 470 crores. During the year, another significant development that we had was securing our first HAM contract in Rajasthan for elevated bypass for the Jodhpur City from NHAI. This marks GPT Infra's entry into the HAM segment, which further diversifies our project portfolio and strengthens our positioning in the road and highway space. We have a 51% share in this SPV, which has been already incorporated. And the contract value is about INR 669 crores. We also commercially operationalized our facility in Ghana with the first supply in [indiscernible] being engaged with the customer in March 2026. As also limited to you earlier during the year, we have also started a factory for fabrication of steel orders in Singur and West Bengal with the capacity of almost 10,000 tonnes per annum and we are also looking at enhancing that capacity further. Now moving to the financial performance for the fourth quarter and the full year ended March 31, 2026. On a stand-alone basis, revenues from operations for Q4 FY '26 stood at INR 373.9 crores as compared to INR 369 crores in the corresponding quarter, representing a growth of 1.3%. On a consolidated basis, revenues for the fourth -- for the quarter stood at INR 414.7 crores compared to INR 380.7 crores, representing a growth of 8.9% year-on-year. The subdued revenue in this quarter was largely on account of the recently concluded elections in West Bengal, which affected the month of March for the execution purposes. For the full year FY '26, standalone revenues came in at INR 1,226. 3 crores as against INR 1,159.3 crores in FY '25, registering a growth of 5.8% year-on-year. Consolidated revenues came in at INR 1,290 crores compared to INR 1,188 crores in the previous financial year, registering a growth of 8.6% year-on-year. Stand-alone EBITDA stood at for the quarter stood at INR 63 crores compared to INR 41.6 crores in the corresponding quarter, registering a growth of 27%. The EBITDA margins have also improved by almost 300 basis points to 14%. Standalone EBITDA for the full year was at INR 162.5 crores compared to INR 141.4 crores with is seeing a growth of 14.9% year-on-year and margin also improving by 100 basis points, above our threshold of 13%, which stood at 13.3% for the full year. On a controlled basis EBITDA for the quarter stood at INR 69.2 crores compared to INR 38.6 crores, which is a growth of 53% and also enhancing our margins by almost 400 basis points. This is largely on account of starting on a factory in Ghana, which was earlier not there last year. The consolidated EBITDA for the FY '26 stood at INR 174.2 crores compared to INR 135. 5 Crores registering a growth of 28.5% and an increase in margin by 200 basis points. We continue to maintain our long-term EBITDA margin guidance of 13% thus which has historically remained our benchmark hurdle rate, improved execution efficiencies, better operating leverage and a calibrated project mix continue to support healthy margin stability. Going forward, we believe the addition of signaling business and dual scaling up of our -- operations will further support our margin profile improvement. In terms of the PAT numbers, the consolidated PAT for FY '26 stood at INR 97.3 crores, a growth of 21.5% from INR 80 crores last year. On a standalone basis, PAT for FY '26 stood at INR 96.5 crores, a growth of 9% from INR 88.5 crores last year. The consolidated PAT margin was 7.5% and standalone margin was 7.7%. The PAT has grown at a CAGR of 33% in the last 4 years. Both ROCE and ROE continue to be quite healthy, and there's a number that we continue to track. ROCE was north of 20% at 20.9%, while ROE was at 16.4% this financial year. Cash flows have remained strong, supported by disciplined working capital management, healthy execution momentum and continued focus on balance sheet strengthening. We continue to focus on optimizing our debt profile and improving the return ratios as well. Going forward, we expect return ratios to be stronger. Now coming to the segmental performance. The infrastructure segment continues to remain the key contributor to the company's revenues and profitability. During the FY '26 the segment contributed in excess of 90% of the company's revenues, driven by key execution in contracts that Prayagraj, Ganga Bridge, Kona Expressway, Raniganj and others. The steeper segment also delivered a good and profitable margin during the year, supported by healthy domestic demand and improving contribution from the African operations. I'm happy to also note that the Board has declared a third interim dividend of INR 1 per share, taking the total dividend payout for the year to INR 2.75 per share, that is 27.5%. The record date for the same has been fixed as May 26, 2026. This is in line with our total dividend policy for the year. With a robust order pipeline, well diversified project portfolio, improved balance sheet metrics and entry into high-margin business verticals, we believe GPT Infraprojects is well positioned to sustain its growth momentum in the coming years. We are confident of achieving a long-term growth in revenue in excess of 20% with revenue this year expected to cross 27% to 30% for the year subject to the headwinds with respect to the economic conditions on account of the war in the Middle East. The long-term EBITDA guidance continues to be in excess of 13% and with higher-margin business, like I said earlier, of signaling in Africa. We expect this to be 100 points better at around the 14% mark for the full year. Our focus continues to -- going forward will remain like on timely execution, selective bidding, improving return ratios, maintaining financial discipline and scaling up the EPC business through the Alcon platform as well. With this, I would now like to open the floor for question and answers. I request the moderator to kindly queue up the questions. Thank you.

[Operator Instructions] The first question is from the line of Darshil Pandya from Finterest Capital.

Sir, my first question is with regards to our contractual assets, which, as you know, we have seen a bit sharp upside, from INR 336 crores to around INR 514 crores. Can you please help us understand what has led to this in spite of our revenue has been around 8% to 10% growth is what we have seen. So I just wanted to know your views on that.

So the contract assets that has gone up a record of mostly the EPC kind of contracts that we are right now doing. So contract assets, which were earlier around what you are also seeing is on a consolidated basis. So we're also seeing the contract assets have gone up on account of the acquisition of Alcon as well.

That is not done, right? The merger has not yet happened. So .

The merger has not happened. That is -- but on a consolidated basis, it is a 100% subsidiary, right? So on a consolidated basis, the balance sheet is consolidated for Alcon.

Okay. Understood. .

So so can complete? .

Yes, yes. .

So the -- out of the INR 514 crores, almost INR 60 crores, INR 65 crores comes from the Alcon balance sheet towards retention money, unbilled revenue, price escalation, et cetera, which is attributable to that system. So it's not an apple-to-apple comparison as such to INR 356 crores and INR 514 crores. Balance is on account of the EPC contract that we will execute, which do have some milestone payments and we need to higher unbilled revenue in those particular contracts.

How old are these contractual assets?

They are typically between 6 to 8 months.

Okay. Understood. Sir, my second question is that we have been talking with a company for a long time now. Just to understand, we did a QIP of around INR 175-odd crores. Out of which 75% of it was supposed to be used to reduce the debt, which is not quite evidently seen in the balance sheet. So can you please help us understand what is -- what -- where is that money part? Or how is -- how are we planning to reduce this debt? Because similarly, our whole goal was to reduce the debt so that it can push up to the profitability. But I guess looking at the current debt position we are there, it looks like we are back on the track, which were there in 2024, '25.

So the QIP was used to review the debt which was -- if you see compare our March '24 balance sheet to the March '25 balance sheet, we have reduced debt significantly by almost INR 125 crores, INR 130 crores. This year, the bump up in the debt is due to drawdown of the some of the limits that we have had due to the large EPC contract that we're executing? Also part of the internal accruals and results have also been used to buy out this business for Alcon. So it's a mix of both. But given the strong cash flows in the next couple of years, we expect the debt to come back to the same level. So you brought up.

But I guess between '22 '24, '25, we have reduced debt to we had about INR 60 crores, INR 65 crores for -- so maybe if you can ask your account team to send that working that would really help us to understand.

Sure. You can take it offline with MUFG. They will talk with you.

I'll do that. And final question is with regards to our guidance that we have missed. We were talking about crossing INR 1,400-plus crores. So was it about the elections that delayed this -- and just some views on that.

Sure. So I said in that similar thing in my opening remarks as well. March month was quite a bad market in terms of execution due to the elections in West Bengal and almost 40% of our revenues do come from West Bengal. And also, you have to understand that a lot of the migrant labors, which also work on the other contracts in UP, Maharashtra, et cetera, do come from West Bengal. So that has led to a lot of labors moving out. And that is why the guidance for this year is much higher because that delta that we would not do in March, we are [indiscernible] of doing in this financial year. Guidance for this year is stronger than we had given earlier.

Okay. This include INR 140 crores from the Alcon business that we're talking about last quarter?

What includes INR 140 crores?

INR 140 crores of business from Alcon, the acquired entity?

No, it only includes the Q4 number to Alcon because Alcon has been merged with effect from January. So we do Q4 numbers of Alcon of INR 30 crores.

[Operator Instructions] We will take our next question from the line of [ Dasha ] from Sapphire Capital.

Yes. So you mentioned, sir, that there was a level shortfall that we saw because of elections. But currently, how have you seen the -- in terms of labor shortages, is everything back on track? And how has April been so far for us.

April was again the election months. So May, June the elections was concluded, all the results announced. So [indiscernible] again was subdued on account of elections but maybe you're seeing a strong decent profile and labor is back on the site, there's no challenge with respectively good as such.

Okay. So this 27% to 30% growth in your conference, so we don't see any execution risks in terms of achieving this growth?

We don't -- and we have received a lot of new contracts also in December, January, et cetera. So those contracts will also be leading to the revenue mix this year.

And sir, just in terms of war so you've seen the prices of metal and raw materials shoot up. So how do you see that impact, sir?

So honestly, a lot of all our contracts do have a price subscription formula.So all the contracts do have price discretion formula for steel, cement, fuel, et cetera, which are linked to steel prices from sale, et cetera. And cement is based on WPI indices from RBI and fuel again it will be WPI in the assets of fuel. We don't anticipate much of a challenge. NHAI, I'm very glad to report in the last 2 months post -- during the war has also allowed the contractors to get paid -- contract missions and ensuring that the contractors are paid the escalation every month, and they are reimbursed the additional burden every month rather than every quarter or every 6 months ago is being done over the year. So hopefully, we will not see much of a sharp dip in the margin. It could be a drag or a lag, but overall for the full year, we expect to maintain our margin profile.

This 14% EBITDA because even if there's a bit of the Alcon business in the international business will cover up for that. Will that be a fair understanding?

Correct.

Right. Okay. And sir, just in terms of our order inflow guidance for FY '27. And just if you could highlight what sort of pipeline are we looking at and you're currently bidding for.

So order inflow guidance for FY '27 is about INR 3,000 crores. We expect -- we are already bidding for quite a bit of large contracts, whether it is in the infrastructure business, the signaling business that we acquired as well as the [indiscernible] business. Also these are quite active in terms of bidding. Once we are L1, we will definitely announce the same for the stock exchanges. And we are quite confident last year we have exceeded our guidance by 20%. We are quite confident of achieving the INR 3,000 crore guidance for the year as well.

Just in terms of the overall contribution of Alcon for FY '27. How do you see that? And what is the margin profile for the Alcon business?

The signaling business has the margin pop almost 20% compared to the 13%, 14% for the traditional infra business that we were doing. We expect the business to have a revenue this year of almost INR 120 crores, INR 130 crores.

Okay. Okay. Fair enough.

[Operator Instructions] We will take our next question from the line of Parth Kotak from plus 91 Asset Management.

A couple of questions from my end. Like you rightly mentioned in your opening remarks, probably some of our revenue would have been missed due to West Bengal elections. Do we see spillovers in probably the first quarter of -- or second quarter of this year where revenues could be much stronger than what are the normal case run rate is?

We anticipate this to be adjusted in the first half. Like I said to the previous question to the previous person, lady that we expect April to be slightly subdued on account of reduction again. But so the first quarter we'll not do the full catch-up, but the first half will be a full catch up.

Makes sense, sir. Also, I think when we look at our CapEx number this year, we've incurred substantial CapEx, if we include the acquisition, we've spent almost INR 150-odd crores in outlay. Just for the next 2 or 3 years, do we have any major CapEx projects? What is the kind of money that we are looking to spend in terms of CapEx?

So we have 1 -- 1 of the major CapEx projects that we do have is HAM contract with an HCI wherein our share of CapEx would be almost INR 55 crores, INR 60 crores. Other than that, we do have -- we do purchase equipments for our various contracts, which is 1 of the INR 40 crores, INR 50 crores a year. So I would say, on an average for the next couple of years, CapEx would be including the HAM contract would be about INR 70 crores, INR 75 crores.

All right, sir. Makes sense. I think from a question's perspective, that's all from my end. Just 1 last thing, the signaling business that we've acquired, the Alcon business -- are we planning to consolidate in our financial statement or probably just stated as a separate line item like we do for infra and for concrete repurchase your -- maybe some thoughts on this, and that's about it.

So the business is already consolidated as part of our consolidated results. The Board has also, like I said earlier, has approved the merger of Alcon with the parent, that is GPT Infra. And it seems with an EPC business on [indiscernible] as well continue to be part of the same segment in terms of segment reporting to part of the infra lines item rather than having a [indiscernible] line item.

[Operator Instructions] We will take our next question from the line of Ritesh Bhagwati from Alpha Plus Capital.

So just a small update I needed on our contracted assets that we have reported. So -- what I want to understand is like out of this INR 556 crores on the balance sheet, how much of that can we see as a conversion happening in this H1 FY '27.

So I think that in terms of conversion, almost 75%, 80% conversion would happen off that, but obviously, new contracts or assets will also get built. So contract assets, it's not that the contract assets are going to come down significantly. So the 30% growth in revenues, contract assets could also grow in tandem or in some sense. But I think that having said that, one, like I said earlier as well, out of INR 550 crores -- sorry, re, INR 514 crores, the contract assets do also come from Alcon. We are -- we have only acquired a subsidiary in the last couple of months. We are looking at tapering off the contract asset there as well. That will ensure the consolidated contract assets do come down to an early number of 3 to 4 months which is slightly elevated right now due to this Alcon subsidiary.

Okay. Now speaking of Alcon, like so what sort of bid pipeline do we have for Alcon for next 12 months? Like have we got any coverage or [indiscernible] electronic tenders being submitted?

So we have bid for almost INR 500 crores of new contracts or tenders in Alcon in the last 2 months that we are post the change in the management and the Board. We are quite confident that a couple of them will get open and we will be L1. We are also looking at other new contracts as we speak or new tenders as we peak. And there is a good opportunity in that business for it to grow. We expect that to also grow at healthy pace going forward.

Okay. Just lastly, on our concrete sleepers. Like this quarter, again, we saw the segment slipping into red. So which geographies like South Africa, Namibia, Ghana are the law centers for us. And just in case, if you can provide some specific turnaround time lines for that?

So like I said, earlier South Africa, Namibia has -- Ghana started production and South Africa and Namibia, we don't see anticipate much of a challenge. This has also got to do with the currency exchange that goes down in those geographies. They are all seeing a volatile currency like we are seeing in India. So lot of the EBIT compression, margin compression that you will see for concrete sleepers is also on account of mark-to-market for the balance sheet and the items that we have for those balance sheets.

Next question is from the line of Shivam Revankar from Ascendia Expansion Solutions LLP.

Atul, can you hear me? .

Yes, loud and clear.

Atul, say because of this West Asia crisis, there's obviously some expectations of inflation and all that. So I just wanted to get some idea from you about what are the pass-through projects and things like that for -- and considering you have a very large order book now. So how does that pan out?

So like I said earlier as well, all the contracts to have a price discretion formula, which are linked to steel prices from RIL and sale linked to decline as you saw for labor fuel, cement, et cetera. Most of these contracts have a pass -- all the contracts do have a pass-through formula. We don't anticipate on an overall basis that it will affect the margins that much. Maybe on a month-to-month basis, the WPI might be delayed and could catch up in the next month. But on an overall basis, we don't anticipate much of a challenge. And we are very thankful that agencies like NHAI and [indiscernible] have also relaxed their prices payments to ensure that the contractors are paid every month compared to getting paid every quarter or every 6 months in terms of the price deviation pass-through payments. We have also allowed 4 months extension in terms of force majeure due to this war, which will allow us to complete the contracts in time as well.

And my next question was because now that Alcon merges with GPT, that means they can actually look at bigger projects. So -- do you have any sort of average ticket size in mind? Or would you be continuing with the same sort of INR 300 crores type of orders for that business?

No. So for Alcon, we have got contracts in excess of INR 70 crores, INR 80 crores as well on an individual basis for signaling business. So [indiscernible] is now coming up with a lot of these EPC contracts which we were earlier not competitive very much because we were taking quotations from other signaling contractors or electrification contractors, and we did not have credentials as well. With this merger, we will be able to build for the larger EPC contracts that railways tendering out in excess of INR 1,000, crores INR 2,000 crores. And we will be able to offer the full solution, but it is will be lines, bridges, signaling, electrification everything.

Wonderful. And my other question is, again, this is just to take your view I think we have all the ingredients to do at a much faster pace at all and especially with the kind of CapEx, cash flows, everything seems so positive. So are we sort of a bit obsessed with this at 25% , 30% and not 40% and 50%.

So I think that 25%, 30% growth honestly, is quite a good number. 40% is even better, but that, I think, is you do have to be mindful of the economic situation with respect to war in the Middle East and also how the currency is playing out? Because at the end of the day, you are relying on government payments for the public CapEx. So we do have to keep that in mind as well when we are making our target for the year.

Next question is from the line of [ Rajiv Jain ] from [ Orchid Investments. ]

So I just had a couple of questions. Firstly, with the EBITDA margin. So our EBITDA margin improved to 13.5% in FY '26. And in FY '25, it was around about 11.4%. So how much of this was structural -- or was it a one-off type of thing like by operating leverage or be deferred cost? Or was it a really structural thing?

This is a structural thing. It's not -- there is no deferred cost as such that has affected with honestly. And operating leverage obviously has kicked in as well. We do expect EBITDA margin to be north of 13% going forward, both on a stand-alone as well as console basis.

Understood, sir. Understood. And secondly, with a signaling at almost 22% EBITDA margin, how fast can consolidated margins move towards the mid-teens and what would be the steady state margin for the business is, if you could throw some light on that.

So on consol, we expect because of the higher-margin business in Africa as well as drilling business? As our margin this year will also be around 14%, it is closer to mid-teens. And we expect to be betting around that -- that is the long-term target to permitting margin around the level of 14% on a consolidated basis.

Understood, sir. Understood. And finally, about the gross margin. Actually, our gross margin expanded to almost more than 35% level. So is this driven by project mixes or by cost efficiencies like backward integration?

Honestly, gross margin is not a number that we do track because it depends on project mix. It depends on some projects may have more labor element or other elements compared to raw material elements. So we don't track gross margin as a number. We do track a bit as a number.

Understood, sir. Understood. And finally, about the signaling. So you indicated signaling contributes to almost 15% of the EPC scope and was earlier outsourced at 20% margin. So can you quantify margin uplift at the project level post integration?

So we don't have a EPC contract currently in which signaling we have outsourced. Once we get that, we will be more competitive in bidding for those contracts. And so at the project level, the margin would be around 13%, 14% level as such. There will be an uplift the overall margin to 14% on a consolidated basis. At the product level, we expect margin to be around 13%.

Next question is from the line of [ Pramod Dubey ] from SD Finance.

My questions were regarding the order book. So for the full year, we saw that the revenue grew by around 9%, while the order inflow were around INR 2,400 crores. And our order book kept rising up to INR 4,480 crores, which was around 3.5x of revenue. So just wanted to understand what will be structural constraint execution this year? And what give us the confidence that the revenue acceleration will be around 25% in FY '27.

So I think last year, like I said earlier, a couple of questions as well. In March month, there was a structural issue with respect to the elections in West Bengal, which led to a lot of labor shortage as well as slower execution in our contracts in West Bengal. We do expect that event has obviously concluded, and we do expect -- we are seeing the labors back on the job. We don't anticipate much of a challenge with respect to that as well. So we are quite confident of achieving that number of 27% to 30% for the FY '27, given the strong order book.

Got it, sir. And we saw that there was a significant portion of your order book, which was around INR 2,460 crores is still less than 10% completion stage. So how do you see the execution ramp-up across all these early-stage projects? And what will be the key risk for slippage.

So we don't understand much of -- so a lot of these contracts will be referring to INR 2,400-odd crores or contracts that we have received in the last financial year. So we obviously are in the early stages of completion and there's been 10% that you're seeing -- and they are quite in the nascent stage. So we don't have business slippage as such. And they are well on track to achieve the number for the full year.

Understood, sir. And the order book for signaling is currently small, which is around INR 90 crores to INR 100 crores. So what is the near-term pipeline visibility and expected order inflow in FY '27?

So we expect -- we have for almost come new contracts or tenders for these [indiscernible] this currently. We are bidding for more contracts. We anticipate -- we do expect almost INR 150 crores to INR 200 crores of order inflows in this financial year.

Got it, sir. Got it. And given signaling is the high barrier and tech intensive, so what are the key investments, which could be talent or the system are required to compete with the established player?

Pardon?

So given in the selling is being a high barrier and a tech intensive business. So what investment in terms of talent or the systems are required to compete against the established player?

So we have acquired business as a going concern. So the team and the talent that was there that Alcon for the last so many years has also been onboarded with us as well. So we don't anticipate a challenge in terms of acquiring talent because that was already there.

Got it, sir. And my last question was with regards to the revenue. So we saw that the Q4 revenue saw a significant jump, which was around -- on the quarter-on-quarter basis, 46%. So how much was this from the catch-up Q3 disruption versus the sustainable run rate improvement?

There's no Q3 disruption as such. It is mostly a sustainable revenue target. Q4 obviously is stronger every year because of the government focus on CapEx towards the end of the financial year. So Q4 historically has been very strong for us.

Got it. Sir, that was really helpful. That was all from my side.

[Operator Instructions] We will take our next question from the line of [ Saumya Raghuvanshi ] from [indiscernible] Capital.

So my question was beyond signaling, are you evaluating entry into adjacent high-margin segments like tunneling or urban infra EPC as highlighted in strategy.

So we are looking at things like tunneling and other high-margin EPC business also. Nothing concrete been done right now. So we are also looking at tie-up for various signal companies who can give us the typical credits for the same as well? Having said that, our business in terms of construction of bridges, which are quite technically challenging, is a higher-margin business compared to -- there are no construction contracts that you do see, and that is why we are able to achieve a margin of 13% on an EBITDA basis.

Okay, sir. Got it. So my next question was, historically, execution has been back-end loaded. What changes is the project mix or internal process will reduce volatility in quarterly performance?

This is across the board for all EPC companies that you will see first half is generally 40% second half is 60%. And that is also on account of government CapEx, government focus because that's historically the earlier, it was 1/3, 2/3 -- starting move to 40, 60 right now. And we don't think that we can remove the seasonality out of the business.

Okay. So my last question from my side, sir. How are you ensuring project execution, quality and avoiding cost overruns? Given that the scale up.

So we do have various tools at the disposal of the management. In terms of SAP which has been deployed across all the project sites, project monitoring software. In terms of cost overruns, we do have a strong internal audit team as well. which gives management good feedback on the costs being incurred. And we -- our team has been a good experience. I've been with us for quite some time. So we -- obviously, we will scale up our team as and when we grow. But given our experience of more than 4 decades, we don't think that the scale up will be a challenge.

[Operator Instructions] As there are no further questions from the participants, I would now like to hand the conference over to Mr. Omkar Bagwe for closing comments. .

MUFG Yes. Thank you for -- thank you, everyone, for joining us on the call today. We are MUFG Intime, Investor Relations Advisors to GPT Infraprojects Limited. In case of any queries, please feel free to reach out to us.

On behalf of GPT Infraprojects Limited, that concludes this conference. Thank you all for joining us today, and you may now disconnect your lines.