KEC International Limited (KEC) Earnings Call Transcript & Summary

Ladies and gentlemen, good day, and welcome to the KEC International Limited Q1 FY '22 Results Conference Call. We have with us today from the management, Mr. Vimal Kejriwal, MD and CEO; Mr. Rajeev Agarwal, CFO. [Operator Instructions] Please note that this conference has been recorded. I now hand the conference over to Mr. Vimal Kejriwal. Thank you, and over to you, Mr. Kejriwal.

Thank you so much. Good morning to all of you. I welcome you all to the Q1 earnings call of KEC. I hope that you and your family are keeping safe. Let me start with an update on the overall performance for the quarter and thereafter talk about each of the respective businesses. We have achieved revenues of INR 2,540 crores for the quarter with a robust consolidated growth of 15% and a stand-alone growth of 24% vis-a-vis Q1 last year despite a challenging environment. The growth has been delivered by good performances in all our businesses such as T&D, excluding SAE, civil, railways and cables. The growth would have been higher but for the intermittent over challenges faced at some projects, especially in international locations and volatile raw material prices. Considering the elevated price levels of raw materials, such as steel, aluminum and zinc, we have taken a conscious call to regulate the supply of towers and conductors in some of the projects wherever the schedule permits. We have started seeing some softening in the prices recently, especially in steel. During the quarter, we have already reduced our old fixed-price steel exposure by 25% to 30% with power supplies having been done. Considering our current order book and L1 position, we are very confident of a continued good growth for the year despite the regulation of the steel supplies. Despite the significant issues, we have achieved EBITDA margins of 9.6% at the stand-alone level and 6.3% at the console level for the quarter. We have delivered a PBT margin of 6% and a PAT margin of 4.4% at stand-alone. And at console level, EBITDA margin stands at 2.3% and PAT at 1.8%. The margins have been impacted primarily due to the elevated commodity prices globally and the cost of time escalations in SAE Brazil amidst the pandemic. Our YTD order inflows stand at INR 4,401 crores, including the recently released orders of INR 1,503 crores, a strong growth of more than 2x over last year. The largest contributors in order intake has been our T&D and civil businesses followed by railways. We have a strong order book of [ INR 24,434 crores ] as on 30 June '21. Additionally, we have L1 position of over INR 6,000 crores, majorly from our international businesses. Our net debt as on 30th June stands at INR 2,533 crores, which is largely in line with our targeted average borrowing levels of INR 2,500 crores for the year. Our interest cost for the quarter as a percentage of sales has been brought down to 3.6%, which is a reduction of 40 basis points vis-a-vis Q1 last year. Now coming to our specific businesses. Our core T&D business, excluding SAE, has been successful in delivering a growth for the quarter, despite the intermittent challenges faced due to COVID, as I said earlier, especially in the international locations like Malaysia, Thailand, et cetera, apart from Middle East. In Brazil, the pandemic continues to impact the economy with significant rise in number of COVID cases per day. We are clearly disappointed with the poor performance in Brazil during this quarter. We had anticipated a turnaround in the ground situation from Q1 onwards, resulting in an ad par situation by the year-end. Actual situation during the quarter continued to be difficult and showed no improvement on the back of the increasing COVID spread in Brazil, which touched record levels in June 21 and the inability of authorities to control the same. This has resulted in delays in the completion of existing projects and significant additional costs. The availability of manpower, shortage and steep rise of raw materials has impacted execution of EPC as well as our supply projects. These challenges resulted in significant time and cost escalations, which have impacted the margins much more than what we had anticipated earlier. We now expect to complete the 2 legacy projects and 1 project secured in Q3 last year by Q2 or Q3 of this year, effectively delayed by a quarter beyond the earlier expectations. The silver lining is that we have immense construction in 3 new projects, which had been acquired earlier. Additionally, we have secured supply orders in excess of INR 500 crores in the last few months in Brazil. The momentum in P&D order intake continues with the new orders of over INR 1,700 crores led by significant orders in the international market, especially in the Americas, Middle East and SAARC. The overall tender pipeline of P&D continues to be very strong, especially in the international market. Our railway business has clogged by revenue of INR 600 crores for the quarter, with a strong growth of 14% vis-a-vis Q1 last year. The business has also secured orders of INR 900 crores, comprising of orders in conventional OHE as well as orders in the new areas of speed upgradation, port connectivity and third rail for metros. The railway tender pipeline continues to remain robust with a blend of conventional, technologically enabled emerging areas as well as international opportunities. With the continued thrust on execution and an order book for L1 of over INR 7,000 crores, we remain confident that railways will continue its revenue growth trajectory for the year. Our civil business has delivered a stellar performance, surpassing revenue of [ INR 600 crores ] for the quarter with an impressive growth of over 3x vis-a-vis Q1 last year. The growth has been delivered by robust execution in metro and industrial projects. I'm happy to share that the business has got a large order in the urban infra segment for the construction of [indiscernible], a station for Chennai metro. This has significantly enhanced our order book in this segment. With this order, we are currently executing 6 metro and RRTS projects. We are very pleased with the physical progress achieved in all our metro civil projects. We continue to bid for opportunities in water pipelines, airports, urban infra, data centers, warehouses, defense and select industrial and residential segments. With a robust order book per L1 of over INR 4,000 crores, we are confident that this business will be one of the key growth drivers for us this year. Our Cables business achieved revenue of INR 334 crores with a robust growth of over 2x vis-a-vis Q1 last year, contributed by growth across all segments. The business is progressing well with the development of new products. It has received approvals for quite a few products during the quarter and is on track to commercialize them this year. The profitability of this business has been under pressure due to the elevated raw material prices of the XLPE, PVC, et cetera. In Solar, we are progressing well towards completing the last phase of the 20-megawatt carport project for a reputed automobile manufacturer. We have also successfully charged a significant portion totaling 11.3 megawatt of a 13-megawatt rooftop solar projects for a corporate client. In Smart Infra, the execution of the existing project is on track with the Arangapat and the Birkin Smart City projects now nearing completion. Coming on to ESG. As conveyed earlier, we have developed a strategic sustainability road map in consultation with a reputed consultant that lays down our sustainability aspirations and action plan towards a sustainable business transformation of operations. The detailed road map is covered in our published integrated annual report for FY '21. We have identified key sustainability focus areas and have set measurable targets to be achieved over the next 3 to 5 years. On the concluding note, I would like to say that except for Brazil, where the uncertainty is expected to continue for a few more months, we are quite confident about our overall performance despite the current pandemic scenario and the prevailing commodity prices. The tight control of interest costs and the momentum in order intake resulting in a robust order book plus L1 of over [ INR 2,600 ] crores and a strong tender pipeline, we are confident of delivering the good growth in the balance 3 quarters of the financial year. Thanking you. Thank you. I'm open to take your questions now.

[Operator Instructions] First question is from the line of Renu Baid from IIFL.

Sir, my first question would be to understand a bit more on the margin side, which are deicidal lows. So if you can help us understand what was the quantum of operating loss in Brazil, which we had during the last quarter. And given that you mentioned that it will still take a couple of quarters for the old projects to be completed. How should we look at the performance of SAE through the year? And what could be your expected quantum of under recoveries or losses in that business for the current year?

So Renu, I don't have the exact number, but I think approximately around INR 75 crores to INR 80 crores is the loss which we have booked this quarter in SAE Brazil, okay? Next quarter, it should be lower than that, okay? Because we were expecting it to be okay, but I think that the issues are still continuing. But there is project progress, which is happening. So the balance work to be completed is slowly going down. And as I mentioned, out of the 2 problematic projects, which we have and which are large projects, one of them should get over by September or October also, hopefully, and the balance one will go for another month or so. So my view is that we will see some more hits going on in Q2. Q3, maybe marginal, but maybe lower. Maybe we will be able to cover everything in Q2. So Q3 should be, I'll say, marginally loss or maybe this and Q4 should start showing more profits. I think that's the way I'll talk about Brazil.

Right. So subsequently, when we look at the corporate level, overall EBITDA, while your Rail and the other portfolio start delivering double-digit margins and sustain that profitability level. For the current year, in terms of the execution of backlog that we have and the cost headwinds which are prevalent, what is your outlook in terms of margins? Should we be able to at least maintain 8% EBITDA margin or that would be a bit of a challenge for the current fiscal year?

We -- I don't think that should be a challenge, okay? Because with the amount quantum of loss, which we have booked at, I'll say lower revenues, the revenues could have been higher, we clearly see a larger revenue growth in terms of absolute numbers because Q1 was pretty low, even otherwise. I really see that absolute numbers will go up in the remaining 3 quarters, so which will give us a little bit more float to absorb the SAE losses. So I think I am okay, I think we should be able to reach that much EBITDA margins for the full year.

Sure. And secondly, sir, when we broadly look in terms of the order inflows outlook, you seem to be pretty positive. The first quarter inflows were almost 2x. So how should we look at the inflow numbers for the year? And if you can highlight the broad pipeline of prospect of projects across the different segments of operations.

So as of today, if I look at the numbers, we have around INR 70,000 crores of tenders, which have been quoted or to be quoted in the quarter, okay? So what are not yet opened and what will be bid put together are roughly around INR 70,000 crores. And of which almost I'll say, 2, 25, almost INR 40 crores, INR 45 crores are from the P&D market, both India as well as international. And around INR 11 crores, INR 12 crores from railways and a similar figure from civil and others. So that's a broad number I think of tenders, which we have quoted or we will be quoting now. So I think we have a very robust pipeline across our businesses.

Sure. And lastly, just a bookkeeping question. If you can just share inputs in terms of within the T&D as an [indiscernible], how is the performance of the domestic P&D and the rest of the world in terms of numbers? And do we see domestic execution picking up meaningfully on the backdrop of strong backlog in hand?

So domestic T&D had a double-digit growth, okay? International and others were, I'd say, slightly negative, mainly because of the huge COVID restrictions. We are not allowed to send people to Middle East or to, let's say, Abu Dhabi, Oman and Saudi. Even Bangladesh, which is a large country. So there have been significant COVID restrictions, which have pushed back the international revenues, which would have grown otherwise. But domestic has grown. And domestic, we have decent order intake. So clearly, I see that the India T&D on the back of orders will have a good performance this year.

The next question is from the line of Priyankar Biswas from Nomura.

My first question is on the working capital side. So usually, you had highlighted that with increasing level of civil revenues in the mix, ideally working capital levels should have improved. I mean, in a 1Q level. So is there some build in either the T&D or the railway segment, either in receivables or maybe more payables. Have something like that happened?

So let me just give a simple answer, then Rajeev can answer it further. We did see some some delays in payments from railways initially. I think of late now, it's been virtually regularized, okay? I think that would have seen some blips somewhere. Maybe Rajeev, you want to answer it?

Yes. So Priyankar, basically, as you rightly said that since the execution in civil vertical has improved. And consequently, we are seeing improvement on the working capital intensity as far as the civil business is concerned. But during the quarter, there has been some delays from the railway vertical because the passenger trains are not running. So they are slightly late. Tight position as far as the fund flows are concerned. So that is intermittently getting delayed. I'm not seeing a huge issue on that side. But yes, there has been some delays off and on, on the railway vertical that has, let's say, taken the advantage that we have derived from the Civil business. So to that extent, AR is slightly high. But nevertheless, within the quarter, if you look at, we have improved DSO days by 4 days compared to what it was as of March. We were at 264 days. And as of June, we are at 260 days. So our working capital intensity in the non-T&D business, except for railways, has improved.

And what about the T&D, sir?

T&D is -- by and large, we are able to maintain the same numbers as of March and as of last year. So there is -- some places, we have seen some improvement. But as Vimal also mentioned on the earlier question that on the international locations, we are facing intermittent issues, the clients are getting closed because of the COVID issue. We are not able to send our people to the site because visa are not available or flights are not operating because of those issues. But we are quite confident that we will improve the situation in the coming quarters.

And sir, last question from my side. You have already highlighted about the commodity. But my question is regarding the rise in freight rates, I mean, the ocean freight rates and also lack of availability of space on ships. So is this also among the reasons that has led to maybe lower performance in the international? And how do you see the situation pan out, I mean, in the coming quarter?

So Priyankar, I'll not say that the freight and all has caused the situation in international market. Fortunately, for us, a large part of our revenues this quarter was more from domestic. Clearly, the freight rates have gone up, okay, probably more than double. But as far as availability is concerned, I think we were lucky that we had some good arrangements, et cetera. So as of now, we have not seen availability being a major concern. Yes, you do miss one ship and all that, one freight, so it may get postponed by another week or so. But as of now, we have not seen any issue. There is a marginal impact of trade definitely on the cost part of it. But as I said that this quarter was more domestic, so we were able to sort of manage it.

The next question is from the line of Ajinkya Bhat from Macquarie.

A couple of questions from my side. Number one, on Civil segment, you have expanded quite a lot recently. And clearly, your addressable market has now gone up significantly. If you could just give us some idea on what has been the win rate for KEC in the tenders that you have quoted so far in the Civil infrastructure segment? And any indication on what has been the winning margin in the sense that has there been a significant difference between your L1 bid versus L2 or what has been the percentage difference on average? That's my first question.

So on the average, the difference would be between 5% to 6%. Some of the bids have been very, very marginal where the difference was almost nil. And in fact, in Chennai Metro and all that, we were not even L1 because there's the contract that had a clause that only one bid will be given. So we were almost, I think, 6% or 7% higher than the L1 when we bought it, but that was a strategic way of bidding. I've not seen significant differences in civil. One thing we have to understand in Civil, Ajinkya, is that most of the clients give you a base rate of cement and steel. So we always quote with our base rate, and there is a price variation clause which is there. So a large part of your civil cost is cement and steel. And since the base rate is given and the weight of your quantity is given, most of the competitors would be -- almost 60% to 70% of the cost will be at similar levels. It's only on the balance, 30% cost of mechanization and lever and other things, where you tend to play around and then decide which one is where. So civil, I don't think you'll see large differences in the bid. As far as the success rate is concerned, I think our success rate in civil, generally has been pretty decent in terms of the industrial. That is because industrial are more negotiated. On the public spaces where government tenders are there, I think I'll say that -- like a normal like 1 out of 6 or something like that is what has been the winning rate.

Okay. Sir, second question is on the Solar EPC business. So from your perspective, what is the outlook on solar EPC and competitive intensity? And if you could just highlight when it comes to building for solar EPC contract, what is the key differentiating factor that determines a winner versus a loser? Is there any engineering ability that is involved in solar EPC? Or is it purely just erection of some metal framework and installation of solar panels. So it will probably the execution efficiency that matters.

So we -- the major part or the major role is played by the -- by your risk profile. Most of these tenders will have something on how much power you can generate, what is the guarantee you're giving and all that. And depending upon what is your risk appetite, people can play on that and, say, might be your ratio will be this. My generation would be this, my DC to LC ratio would be this. And we have seen a lot of people coming to grief because of very aggressive calls on that, okay? For us, solar, we started some time back. I am -- at least I'm not seeing a great future in KEC for solar since we are there, we have got capabilities and we are -- that sometimes able to use it together with others like a data center or in other places, we are running this, okay? And we have clearly seen that whenever volumes have been taken, in most of the cases, we have seen that it's always been negative for whatever reason, either the Chinese model prices go up or the government imposes duty or the ForEx goes against you, okay? So we are -- for us, I don't think solar, at least in the near future, has a major role, okay? And people who are willing to take calls on modules are the ones who have an edge over other people. Otherwise, in engineering and all that, there are standard software modules available where you can work out all this and come out with numbers, et cetera. So I don't see people having a significant edge. Yes, we do manufacture our own structure. So we do have some edge over other people on that. But structures are again not a great percentage of your cost. 60%, 70%, it is module costing. So I don't see people having any significant advantage over each other, except on the aggressive calls which they pick.

Okay. Understood, sir. And just one final question. The margin decline on consolidated financials that we have seen in this particular quarter, is it entirely attributed to SAE, as in would you be able to quantify? Could we say about 200 to 250 basis points would have been the EBITDA margin impact because of challenges in SAE?

Yes, you can see the numbers that will stand-alone at this. [Foreign Language] And then there is a small margin, small number, I think, of our Dubai plant, which would be positive. So it would all be sort of the entire difference would be contributed by Brazil only by SAE. Mexico is neutral. So Brazil only more or less.

The next question is from the line of Vivek Ramakrishnan from DSP Mutual Fund.

My question again goes back to the working capital. The reason why I'm asking is that interest rates seem to be slowly inching upwards. And the rating agencies have mentioned that your working capital cycle is a matter of reason why they would look for a change in rating downwards if it balloons. Is there any point of time where you'll start looking at equity to just kind of kill the working capital cycle? Or how comfortable are you that you'll be able to keep it within what the rating agencies have said? Just to give indication, rating agencies has said negative in case total outside liabilities to total net worth is more than 4x is what [ ITRA ] said and [ cross-sellers ] said weakening of financial risk profile due to strict in working capital title.

We have no program for looking at putting or raising any equity. I think we are pretty comfortable with what's happening. And I think the other piece is that even if the domestic rates go up with my international business being 40%, 50% of our business, we can easily raise money overseas without any foreign exchange risk. So I don't think we have any plans for any equity raising either today or in the distant future also, so no.

Okay, sir. And would you say that you'll be able to better working -- control working capital cycle, I can understand with COVID and so on, there'll be so many disruptions. But year-on-year, the numbers should be better than last year?

So Vivek, if you look at our borrowing numbers and our commitment or sort of to keep the borrowings around INR 2,500 crores. We have been sticking to that, notwithstanding the increase in revenue. Even this quarter, we -- our revenues have gone up by 15%, last year also. So I think we are very clear on that, that our working capital cycle is definitely improving because with the same amount of borrowing, we are doing a higher turnover, number one. Number two is, if you look at various businesses, and especially as Rajeev was talking about civil business where the DSOs are lower and collections are better, okay? And I think then with their share in the pie going up, I clearly see that we should be able to manage our ratios very well. Rajeev, do you want to add anything on this?

Yes, Vimal. So basically, Vivek, you talked about the rating agency. So if you look at our long-term ratios, 1 year could be an aberration, a slight aberration, I would say. If you look at the last 5-year trends, our overall liabilities to the network, about overall borrowing numbers, all the ratios, if you look at what the rating agency is really focused on the -- for [indiscernible] rating, so they have all been coming down. Even last year for 31st March 2021, we have been able to improve our total liabilities to the network. We have been able to improve our net debt-to-EBITDA number. So all the numbers we have been improving. And our guidance as far as the overall borrowing is concerned of INR 2,500 crores, we have been able to maintain despite 10% to 15% growth, which we are witnessing for the last 3, 4 years. So we have raised with the -- our overall level of borrowings, which were at about INR 3,500 crores, which I remember about 4 years back, we have come down to INR 2,500 crores. Whereas during the same period, our top line has grown from INR 9,000 crores to INR 13,000 crores. So there is a very clear focus on the working capital. And even now, we are not really happy when I tell you that our current working capital. We are -- we still have a plan to further reduce our working capital intensity. And with the businesses that we are getting into, for example, the civil business. Railway, according to me, is a temporary issue so that will also get corrected. So there is a lot of focus on the working capital, and I'm quite confident that the working capital we will be able to control.

[Operator Instructions] The next question is from the line of Ayush from Spark Capital.

This is Ravi from Spark Capital. Sir, most of my questions have been answered. So only one question with respect to railway order inflows. So what kind of order inflow, both from Railways and Civil side that we might be looking at this year? Given the fact that last year due to COVID, it was slightly on the lower side. So basically, and we go back to the INR 3,000 crores level of order inflow on the railway side. And civil side, what kind of order inflow targets do we have? And what are the drivers could be there to drive the inflows within this?

So for me, Ayush (sic) [ Ravi ], between the two of them, we should be looking at anywhere between INR 8,000 crores or something of order intake. That's what we have been looking at. And if you look at our current numbers, I think we have already got around INR 2,200 crores, INR 2,300 crores of orders between the 2 businesses. So I think INR 8,000 or maybe even slightly above that would be a fair estimation of what sort of order intake they're looking from these businesses.

Okay. And railways, which are the segments that are driving the inflows and Civil also be [indiscernible]

So surprisingly, it's still OHE more, okay? We had thought that OHE will slowly taper down, but I think OHE is coming back on 2 grounds. One is balance orders are there, they work to fast track. And second is that there is -- I don't know what they call, Operation Raftar, as they call it, that's Operation Speed in railways. As Railways launched this Operation Raftar, where they are trying to speed up the trains on all the metro projects -- on all the metro routes, sorry. So between Mumbai-Dehli or the Dehli-Calcutta, Mumbai-Calcatta and all that. And based on that, they are actually sort of removing the existing OHE and putting up new OHE, which are of higher conductivity and more capacity so that the Indians can get more power, okay? And recently, we have won almost 80% of the contracts, which have come on this. So they are -- And I don't say they are actually OHE in that traditional sense, but they are OHE because we're replacing the conductors you're [indiscernible], enacting new mass, doing a lot more cables and all that different type of cabling, et cetera. So OHE has been a topic for us. The second one has been on the metro side. So Metros, we have got in a large way on the non-Civil, which is what my railway table is doing, which is ballastless tracks, embedded tracks, we were recently L1 in a power supply contract. So we have now got into almost all actions on the metro side, except for signaling in metro right now. We have not won any contract there, but it's a matter of time. So to me, that piece also is becoming critical. So OHE in the conventional railway and the other pieces in the metro.

Okay. Got it. And civil side, sir, for revenues? Civil side or what is driving growth for Civil?

So Civil, if you look at the volume side, the value that there will be civil and also water pipelines, et cetera. So we are the 2 large volumes. Then there are obviously a small amount coming from residential. We are not very big there. We only work with a couple of developers. And Industrial, we have got a lot of projects, but it's still not very -- in numbers, they're large, but volume-wise, they are at a INR 60 crores, INR 70 crores, INR 80 crores, INR 100 crores. We have got our first FMCG order. We are just -- hopefully, we're getting a first order in a pharma company. Otherwise, we have basically been in cement and steel, okay? So we have some chemicals and some other -- Largely, our large revenues are coming from cement plants and steel plants.

The next question is from the line of Amish Kanani from JM Financial.

Congrats on the diversification that we have been achieving slow and steady and crossing the 50% market from the revenue determinant, albeit on a lower turnover of SAE. So the question I have is, what are we doing to kind of mitigate the losses? First of all, if you can remind us the kind of losses that we had, is it a project loss? Or is it a fixed cost incurring losses on the large base that we have or is it a ForEx loss? If you can give us some flavor of that. And as you said, it will down by Q3. So are we looking at some drastic cost reduction program there? Or we take a very long-term set of review of the business and we say that in the long run we'll sustain this -- we'll come back to the profitability in the way it was on Brazil side?

So Amish, let me put this way. We acquired this business in 2010, okay? And till March 2020, that's 10 years, we have been consistently making money, okay? Even on these projects, we did make money until March '20, okay? And after the COVID hit, unfortunately, what has happened is that in other parts, we were able to recover, but Brazil being Brazil, whatever is happening, everyone is aware of the dynamics and the politics and all that. And there is a demand for in breaching the President because of his failure to control COVID, et cetera. So there are a lot of things which are happening. So the problem is you asked whether it's fixed cost or project costs? So effectively, what happens in Brazil is that the labor laws there are, I'll say, more archived what we had in India a few years back, okay? So we have got -- and if you look at our HR manpower cost and all the significant jump in the quarter. Because in Brazil, what happens with most of the labor is also on your own. Now there's a COVID shutdown. Now I have 2 choices, either I ask the labor to go. And there, the separation costs are very high or -- and then you are not sure where you'll get them back whenever permission is received, okay, or you continue with them. So effectively, what happens is these are project costs which are becoming fixed costs, okay? You have labor sitting idle which you can't do much about it. Because if you let them go, you are going to incur a lot of cost. And also, you are not sure that you'll get the back, okay? So that's the attached to the situation. Unfortunately, travel restrictions, visa restrictions and all that, we are not able to somehow beef up the management or the project teams and all that, okay? We did bring some people from whereby countries there but the restrictions are very strong. So I think it's just a matter of time. And so unfortunately, what had happened or I'll say unfortunate or fortunate, we have taken large projects. And both of them have turned out to be difficult projects, and they were in continuity of each other. I think once these projects are over, I think we do expect that Brazil would start getting back to normalcy.

Okay. And sir, second question I have is if you look at the stand-alone margin, we still had 9.6% for the quarter. My question is, sir, on the railway side, you mentioned that you've been taking metro project. And in some of the metro projects, you have seen some of the companies facing challenges on the -- sometimes on the political side where the progress of the project stalls and given the COVID situation, sometimes these public leading projects there always are not even functioning, the priority of completing those projects can be delayed. So the question is, sir, what kind of project mix that we have on the railway metro side, which gives us the confidence that at least on the stand-alone margin side, which are heavier 9.6% to not be at risk given the macro projects that we have. And if you can remind us of what is the level of margins between railway and civil. Have we reached those threshold margins where we aspire that we should reach there.

So -- on the -- let me answer the margin front first. I think on the margin front, we have -- or on railways, we had touched double-digit last year. This quarter, maybe it was slightly, below 10% or something. I don't know about that. Nothing -- not where it is. Very different of what we wanted it to be. As far as Civil is concerned, with the volume growth, the leverage is really coming into play. And I do hope that things become normal on the COVID front. We should be close to a double digit by the end of the year. That's what we had talked on it. I think we are pretty confident that we should be reaching that by the end of the year or maybe a quarter or year or there, okay? So I'm not worried about margins on railways or in civil. Yes, as far as metro and all is concerned, understand one thing. The civil piece of the metro, except one project which was started by railways initially on the RRPA side, everything else is on the civil business, okay? So railways does not have -- except one project on the civil side of Metro. Rest of all, what railways has is the non-civil portion. That's [indiscernible] track, embedded tracks, third rail, signaling, power supply, et cetera, et cetera, okay? And clearly, all those come into play once the civil piece is ready. And of late, we are clearly seeing whether it is KEC or whether it is anyone else, you see -- keep on reading the announcements that the wire duct construction is becoming much more fast. I'll give a simple example. In our case in Chennai, from the day we bought an LOI, within 1 week of [indiscernible] test had been done, okay? And now within 1 month, I think we have already cast quite a few normal piles also. So clearly, on the civil construction side of metros, we are clearly seeing that not only here, most of the competitors are also doing a lot of fast tracking, okay? But I don't think -- and most of the metro projects have got definite lines of funding to finance them. So I have not seen a single metro project or single payment either from Chennai or Kochi or from DMRC from RRTS. In fact, most of them are one of the best paymaster, I know the reasons why Rajeev was saying that the civil DSO is coming down is because of the very quick payment from the metro clients. So I don't think we are at all worried about metro being a drag either on margins or on revenues.

The next question is from the line of Saket Kapoor from from Kapoor & Company.

Sir, as you were explaining the SAE underperformance, so what is the size of the 2 projects? And how much -- what portion of the plan has been executed up to the first quarter?

I don't have that number, but [Foreign Language], one of the projects has got very little, I'd say probably 10% or 15% execution left. Other one would have maybe 20%, okay? And broad value, both of them put together would be around INR 800 crores, INR 900 crores when we originally got them, okay? [Foreign Language]

Okay, sir. And sir, secondly, is that now we are seeing this commodity upswing when getting strength if we make also stabilizing also the prices of major commodities at these levels with flight plateauing. Sir, what portion of the order book you still see is that there would be lower margins we have to book because of the prevailing commodity prices, sir? And I have one small more follow-up and I can come back.

So as I have said last time, we had around, I think, 100,000 tonnes of steel on the old fixed prices. Of which, as I mentioned in my speech, around 25%, 30% has already been executed during this quarter, okay? So [Foreign Language], depending upon how the project progress requires, we will also execute it, okay? But clearly, let me put it very clearly that as compared to what we saw in March, April and all that, the steel prices have come down by, I think close to around INR 4,000, INR 5,000 per tonne. That may not be what seems from market reports, but that's the fact that the -- because we use long products. We don't flat products where the prices are still -- we use a little bit of flat product, I'll say. But most of our products are what we call a PMP sarriyas and [indiscernible] and angus and channels, et cetera. So there, the prices have come down. There was a sharp uptick in the start of the year because of the oxygen shortage, because of this the secondary market has shut down. Now that the oxygen issue has been closed and industrial oxygen, I'll say freely available, the secondary market has started operating fully and which has caused a significant dent. And also with the problems in shipping and all that, we are clearly seeing that export market has come down for many countries, especially China from India, okay? So steel prices are clearly below what we had projected. So I'm not worried -- not worried about that. As far as other meters are concerned, they have been on -- I'll say jigsaw going on. Aluminum was at 25, went to 23, not it's again back to 26. So I think we have enough time to wait and watch. So I'm not seeing a significant impact of the non-steel piece today because I have enough time to wait and watch. Steel is something which we cannot wait for indefinitely, which is why we reduced 30%. Maybe again, another 30% will go in Q2, okay? So we'll keep on producing and that's all. And you have heard me on my first question on the margins and all that. So most of the margins where we were a little bit on the back foot was because we had accounted for the current steel prices.

Right. So concluding, sir, the performance of SAEs contributing negatively to the consolidated number. It is very likely to assume that it will be difficult for us to close the margin for this year, even levels for FY '21. The margins which we had for FY '21, it would be difficult since the contribution -- the negative contribution would mitigate the profitability?

Difficult to say in the sense that if you're looking at percentage, maybe you may be right, it could vary by some basis points here and there. But also to keep in mind is that we have a strong order book. So there will be a strong top line growth, which will give us some leverage, okay? So in absolute terms, our margins will definitely be higher than last time. 100%. There's no question about that, okay? Whether in terms of percentage, we are able to meet them or we'll be slightly lower and all that. I think today, difficult to say, because I do not know what will happen to steel, what will happen to aluminum. Let's say, commodity prices become a little bit more favorable, then we may be able to meet our last year's margins, okay? If commodity prices go up further, then we may not be able to move the last year margin percentages. But in absolute terms, I think with the growth we are talking about, I'm more than confident that we will deliver more than last year.

The next question is from the line of Deepak Narnolia from Birla Finance Insurance.

So I had 2 questions, actually. One is about your margin. A lot of questions were there about your margin. I wanted to know that in SAE towers, your stand-alone margins are relatively better, I think, but you're SAE hours have mainly impacted. But since last quarter, you have been saying that you had 3 orders in Brazil and most of them were largely getting over. So I wanted to know, if you can give any color on your future margin for the next 3, 4 quarters? And what exactly is the problem in Brazil? And number -- and in margin only, this -- the [indiscernible] price means it has not hit you in a big way. But then the [indiscernible] strong. And I remember that in the last call, you had said that if it continues to be remain strong, then it will hit your margins. So if it -- what is your view on that? Number one question. Number two, as far as your working capital is concerned, absolute number of days looks like 135 days. but your acceptances have increased significantly for this quarter? So what is the exact situation of receivables? And what's the future view on that?

So I think I'll let Rajeev answer the working capital first, then I'll answer your question. I think there were some disturbance. I lost some part, but I will try to answer everything. Rajeev, you want to answer the working capital first.

Sure, Vimal. So basically, Deepak, if you look at the working capital piece, there are some acceptances have gone up, but that is by design. So we should really look at the overall net working capital. Net working capital days is 135 days, which is more or less in the similar lines as we had the same quarter last year. But despite that, if you look at the interest cost. The interest cost has gone down from 3% to 2.6% on a console level and 2.5% in a stand-alone level. So basically, what we look at is because we have many levers to pull in the working capital piece. Sometimes we borrow largely in the foreign currency loans. Sometimes, we'll switch over to reduce our foreign currency and start getting -- adding a lot of premia out of the furnishing market because you are -- forward premia goes up to 5% and all. And then we also have a lever in terms of reducing the number of days, creditors going up and stuff like that. So what I'm saying is that there are many levers. So ultimately, what you should be really concerned is the interest cost. Interest cost during the quarter has gone down, both in the absolute terms as well as percentage to sales. So this is what actually we look at while exercising our raise lever for the working capital.

Yes. Rajeev, thanks. So Deepak, I mean your questions on Brazil and all that. Normally, we quote there on a standard margin of 10% as is there as in the other markets, okay? And as I said that we were expecting to complete the projects -- one project within this quarter and one I had said that we'll probably go to Q3. But the way with the COVID currently going on, what we have now said at the start of the conference was that there will be 1 quarter delay. And both the projects should get over in Q3. So clearly, there will be a large amount of additional costs, which we are incurring, which is causing the loss. The second thing there is that material price impact there has been much more than even in India, okay? And because of COVID, there has been a huge disruption in their entire manufacturing. And you can see that, that's happening. Of late, we are seeing a bit of a recovery in their GDP, et cetera. So I do hope that, that will also come down to the construction companies and market start stabilizing there. But we have secured 3 new projects on EPC, and relatively smaller projects, not as big as the ones which we are currently executing. And all these 3 projects have started well. And apart from that, we have now got more orders on the supply side also. So I think we are confident that we should start seeing a turnaround happening from Q3 in the Brazil numbers.

Yes, one more thing, sir, if you allow me to ask that?

Go ahead.

Sir, your numbers are quite abate to the market trend, everybody delivered a very poor set of numbers in first quarter of last year. And this quarter, the other companies, most of the companies are delivering relatively much better results in comparison to the last year. But in your case, what I see that you delivered relatively better results than last year. But this year's first quarter is much lower performance in comparison to what other companies are reporting. So what's the exactly is the reason behind that?

I think the reason is very clearly that in the last quarter -- last year -- sorry, first quarter last year, our international operations were continuing very well, okay? So we were able to deliver a lot of revenues from international operations in Q1 FY '21. Whereas in this year, it's been -- the international operations have been impacted, including Brazil, et cetera. And that's why if I look at some of the competitors where results have come out and I was having the same question as you are, then the FY '20 Q1 and then when you map FY '20 Q1 FY '21 Q1 and FY '22 Q1, you will get an answer where you will see a lot of similarity from FY '20 to FY '22 [Foreign Language] You will find that almost everyone is delivering in a similar manner. Others have show a lower number in FY '21, we have shown a higher number because of the international operation, which is the reverse now for us in this quarter.

The next question is from the line of Ranjeet Sivaram from ICICI Securities.

Yes. If I look at your Cable business, that has shown good [indiscernible]. So what is your overall status regarding because this distribution reform is also coming up. So is there any plans to double up the capacity because there will be a huge requirement for cable trend? So is it right to look at that as a growth opportunity for us?

So Renjith, we are seeing a growth in Cable in -- I'll say, on more on the EHV and the HV side and also on the railway side, okay? The LT side, I'll say, still relatively flat, okay? And there is a cut throat competition and you see results of all other cable companies also. I think on the pure play cable, I'm not talking about house wire, cable section, people have been having some difficulties because of -- at least till now, there is not major traction on the LT side. One was because of the COVID. Second is because the raw material prices are so high, copper aluminum, that people are sort of postponing their procurement on many places wherever they can. But having said that, we did invest a lot of money last year in expanding our railway capacity. And this year, we do expect that our railway should probably be 30% of our entire cables, and we're talking about a growth of almost 20% in our cable. This quarter, we have been double of last year. Last year was a pretty bad for Q1 because the factory was shut down because of COVID. So I think cable, we are very positive about the growth. We have not yet started. We are looking at whether we should invest or not, I'm not sure about it, whether we will invest or not. But we can do a lot of debottlenecking, et cetera, because we have old -- on the LT side, we have old plants. So it will be easy for us to expand capacity. We have already done some debottlenecking on the EHV and HV side, and we will clearly see a lot more share in our revenues coming from the higher products upto 20 KV, et cetera, and also railways. So clearly, I think we are very positive about cables, okay? And that's one business, Renjith, where our net working capital is negative.

And are we there in solar cables for you, sir, use for solar?

So we are there in solar tables, but not in a large way because solar cable is signal for cable and the productivity gets impacted significantly. And also, what we have seen is that with the current prices and options, et cetera, the EPC prices are pushed to the bottom. So the price which you get from solar manufacturer is a little bit of concern. Secondly, what is happening is that with the recent judgment and second, some of the state governments going back on their PPAs, we are seeing a lot of solar projects getting postponed. And then that leaves you with open orders, you do not know when you will execute, et cetera. So solar is not a large share for us. We do sell some solar, okay?

And sir, lastly, on the oil pipeline, you told about water pipeline. So why are we not getting into this oil and gas pipeline? Is that huge opportunity?

It is my mistake. I should have covered it. We have actually opened a separate SPU for oil and gas pipelines, okay? So it's apart from a civil SPU where we are -- and for us, it looks like a very important, I'll say, adjacent diversification for us in terms of oil and gas. I have said earlier this time, I did not cover, I should have covered it. We have already built for a few projects. Even now, we have some open bids on oil and gas pipeline. So clearly, we are very bullish about that business. And you will -- if not this quarter, next quarter, since we are bidding, you will definitely start seeing some success, some announcements from us on oil and gas pipelines.

The next question is from the line of Parikshit Kandpal from HDFC Securities.

So my first question is on the... hello, can you hear me?

Yes, it is a little faint but yes.

So first question was on the commodity inflation, sir, so in this environment of benign commodity prices, so how is the industry bidding? And what are the steps and the litigations you are taking while bidding for projects?

So to me, there are 2 things, I'll say, 3 things which are happening. One is, obviously, going back and talking to people saying that whichever fixed price contracts, can we get some leeway, can we convert them, et cetera. So there, in some places, you are seeing some success, some places you're not seeing success. Whenever the projects require, you are still supplying to them. So that's one part on the existing orders. On the new orders, clearly, we are preferring and the industry also has been talking to on the clients, et cetera, saying that you need to ship to variable pricing. Although I'm not in favor now with the prices coming down, there's no point in now shifting to variable pricing, but that's the second piece. Third piece is, wherever there are fixed price contracts, you are porting them with a lot of caution and with expectation of what is happening and adding your forward premiums, et cetera. So I think what you'll start seeing also is that whatever contracts we have won now in the last, let's say, quarter or so, they were quoted at current prices or maybe slightly higher than current prices. So when they start getting executed, they will set off some of the lower price contracts.

Question on that -- you highlighted that about 1 lac tonnes of steel is there, if you have used about 30%. I just wanted to know how much of this is lining steel and also the business which you explained how the business was steel. So we have a high fixed cost proportion and the cost of EPC because of the REC labor laws. So how this is ordering vis-a-vis planning on during the political turmoil and issues around COVID. So because what happens is this way, you'll come back to flat. But next year, again, if there is no decent pipeline, the ordering size, the fixed overhead you basically start meeting again into margins and then there are margins for next year. So if you can just highlight on how the ramp-up of the ordering will happen your sense on that.

So Parikshit the large part, I'd say almost everything of the fixed price, what we are talking about is on Brazil, okay? Brazil, as I said, these projects are close to completion and all that. So there's hardly any fixed price on steel, et cetera, in the current projects, number one. Number two, when I said fixed price, fixed costs in Brazil, it was with relevance or with reference to these particular projects where because of COVID you have people waiting and all that. So otherwise, I don't think we have a large fixed cost in Brazil, number two. Number 3 is, we -- as I said that we have almost more than INR 500 crores of orders now. We have 3 new projects in Brazil on EPC. So I don't think we are worried about absorption of fixed costs in Brazil. We have enough orders. I don't have the exact number right now, maybe someone have it. But I think the orders are more than INR 1,000 crores in Brazil, which are at reasonable, I'll say, margins, okay? So I don't think we are worried about, going forward, absorption of fixed costs, except for these 2 projects, which should get over in the next quarter also.

Okay. Last question on the data centers, which you touched upon. So I just wanted to know the civil size of the data center is small. So typically, when you're bidding, is it that entire lump-sum contract of country projects which -- product part also which you supply or it's just a civil part at which you are looking at?

So Parikshit it will depend upon what the developer is looking for. For example, right now, we are just about to finish one data center for our defense client, where we have done everything from site griding, to building, to MEP and to air connection and everything. Obviously, you don't do the hardware and the software part of it. That's always put in by the client or the networking, et cetera, okay? So that part is not in this. There's another one where we are bidding well, we are only doing civil. And there are others where we are talking where since with the power consumption, there's a lot of emphasis on green energy. We are now talking with someone to do an entire data center, including a substation and the solar panel said, we're doing everything except for the, let me say, the technology part of it inside the data center. Then there are a couple of people who are talking to us saying, you only do the civil part of it. Right now, I've got one contract from one of our leading data data center developers. This was first given me the infrastructure, see why don't you come and develop the infrastructure and the ground level. And then we will give you the contract for the civil and then for the other pieces. So it actually depends upon the developer in what format he is trying to structure the data center tendering. But with our cable supply, with our solar, with civil and everything in place, we can actually do the full data center for everyone minus the technology to top it, okay? Like only I can still use, I'm sorry if I want to, but I don't think we want to get into that. Right now, most of our developers want to have their own technology or they will use this for the client. Let's say somebody is developing a data center for Amazon or Facebook or whoever else. And that entire space will come from them, okay? Now that's the way we are looking at data center.

The next question is from the line of Gopal Nawandhar from SBI Life Insurance.

Sir, my question was on -- again, on the SAE part. We have been making losses in the last couple of quarters. And we know these orders are going to make losses. Why we don't make any prudent provisions on those projects in a given period rather than spreading it over the couple of quarters.

So Gopal, we do not know that we'll make losses, okay? Otherwise, I have not have stuck my neck out and said that we'll not make losses, okay? The problem is when we enter the quarter, then suddenly, something is happening and like no one would have predicted, you'll have a wave 3 in India. The same thing is happening there. We had never thought that there will be a loss going on. Then there are compensation claims and all that. How much you will get, what will happen, a lot of things are there. if I know that I am going to lose money. Even now when I'm talking about Q2 and Q3, there are a lot of discussions going on, which obviously I cannot disclose here, with clients and all that, what they will pick up, what we have to bear and everything is there. So prudently, we do not know. If we know prudently that [Foreign Language] then obviously, we have to provide both in accounting terms as well as prudent management, okay? The problem is that, we do not know what we expect and we saw the things that this will become normal and will not be losing money, and we'll be able to recover whatever we have lost. Unfortunately, that's not what has happened, yes.

And sir, another question is -- the situation still grim in Brazil, and we have got a few orders in last couple of quarters. So question, again, is that how confident are we to make the margins which we were making earlier in this business?

So I think let us be very clear. These orders were taken 2 -- I think, 2, 3 years back, when the manner in which the orders were taken are very, very different. There were large orders where the engineering was to be done. So there are a lot of variables, and that was a typical way in which ordering used to happen in Brazil. Off-laid, the entire ordering pattern has changed in the Brazil. The sizes of the orders have come down, the developers do not want to give 1 order to 1 person. So they've been breaking it down. Engineering has been done in advance. So the variables come down significantly you are now aware of what is happening on the cost side. The cost sides are getting factored largely, okay? So that is the way that the risk profile of the orders have changed significantly, okay?

Okay. And sir, lastly, India performance has been very strong despite these all commodities-related issues. Is there any one-off gains in the India business? Or...

No, there's no -- I don't -- there's no one-off gain in the India business. No.

Okay. So then basically, these kind of margins, at least in India business, we should be able to sustain, if commodity prices doesn't go up from here?

So Gopal we do expect to sustain the stand-alone margins, okay? And I'm sticking my neck out beyond India, okay? So India is one part of it. There are other international miners, Brazil, okay? Where we have got margins and all that. So I don't think we have any issue, unless we suddenly find COVID is spiking up further, okay? [Foreign Language] okay? So that's been accounted for when we talk about it.

The next question is from the line of Jonas Bhutta from PhillipCapital.

Congratulations on a decent set of numbers, given the challenges, sir. Sir, 2 questions. First, what we've seen is, and this is something that I'm taking up from the annual report, is the investments in the holding company that holds the SAE, the investments by the parent entity has gone up by almost INR 400 crores in 4 years. Now given your outlook for SAE for the current year and maybe some buffer for next year. Do you believe that the level of investments stay here? Or do you think you'll have to put in further cash funding to -- at least for the next year or so, sir. So do you believe that?

Rajeev is going answer that. I'm not sure from where that INR 400 crore number has been picked up. Rajeev, why don't you answer this?

Yes. So Jonas, INR 400 crore number has gone up actually last 3, 4 years, you are right. But basically, what we have done is we have prepaid the high-cost loan because when -- to acquire the SAE business, we had taken a big loan. It was a fully leveraged buyout. So because the cost of that acquisition was very high in terms of -- cost of the loan was very high. It was going to 5.5% to 6% in terms of the foreign currency loan. So we decided to prepaid. That is the reason we have invested equity in that business, and we have prepaid that entire debt. So virtually, at the acquisition level, there is no debt. Also, last year, there were some losses. And because of that, we had to fund those losses. So we have invested some additional amount to take care of the losses and to make that company liquid.

Sure. So -- and this year, given the outlook that at least next 2, 3 quarters are going to be lost in the minor losses or whatever. So do you believe that this year also loss funding is required, sir, from the parent company?

Yes. There will be some loss funding definitely because that company, if you look at the size wise, that company is about INR 1,000-odd crores. They had a network, but with the kind of losses that we have, let's say, incurred on the couple of these projects. So we are required to do the loss funding. So there will be some additional money would be definitely required to be pumping into that company.

Sure. And my second question, sir, was on the Smart City verticals so that we've entered. And while there's not been much of growth there, but just wanted to hear your views on the next 2 to 3 years, whether this would be another growth area or it will be something like solar EPC where you don't expect great growth?

So Jonas, Smart City, we -- and I said, we are finishing those 2 projects. We have got 1 more project which we are executing, and we are bidding for -- we have bid for a few more projects, okay? Unfortunately, what happened is with COVID coming in, most of the states have diverted all their funds available into different areas, okay? If they still call them Smart City, but basically, they are being used for different areas. So if you look at the number of jobs which are coming up, have gone down significantly. And tenders which have been build are not being awarded and et cetera. So right now, it's looking great. But someone asked me a question on data center and when you look at railways, telecommunication and other things. What we are finding is that we are able to leverage a lot on our Smart City or smart infra capabilities to bid for many of them, especially on data center and especially on Metro telecommunications and even in the conventional communication, et cetera, we are finding that useful. Now we are even in a large airport project. Now that airport project is for a large element of smart infra in that, okay? So we may not see too much of smart infra at smart infra vertical. But clearly, that entire piece is helping us in other verticals, okay? And hopefully, if government renew this focus on smart cities and all that and starts actually investing, then we are there. We have the team, which is now -- right now doing other things.

Sure. Sir, on data centers, I just sort of missed out on your comments there, the kind of contract that we take is basically civil -- just pure civil or if it's like a turnkey project where even the substation part, even though while there might be bought outs on the substation side, but that also scope we are getting or how does it work? Your -- and as a percentage of total data center costs, which technically is about INR 30 crores, INR 40 crores in megawatts. KEC share would be how good?

So Jonas, it depends upon on, as I said, from tender to tender, the one which we are right now doing has got everything, including substation and the connections and all that. There are others where, I know in some cases, a subsection itself INR 100 crores, okay? There normally, the client would like to separate it out and give it to a separate substation operator because not all the data center I'll say EPC contractors are capable of doing substations or people feel that maybe an AVP of Siemens can give them a better price than what a KEC or someone can give. So it would depend upon how the developer looks at it. We have been talking with the 2 developers where we are saying that we can do everything for you including substations and the lines, in some cases, the power line has to be drawn up. In some cases, they are looking for pure-play green data center where they want you to do solar panels, solars also. So it is more on the developer, but we are trying to sell ourselves saying that we can give you everything minus the technology, okay., And we're getting some jobs -- we already have one job. We're talking about one more like that on that manner.

The next question is from the line of Bhavin Vithlani from SBI Mutual Funds.

Sir, this question is referenced to the discussion we had in the previous earnings call, wherein you mentioned that steel, as a commodity, is something that you might have to take the hit, but aluminum is something you can spread out and lower the impact. Would appreciate where are we in that. Has things improved or deteriorated from those levels?

So as far as aluminum is concerned, the things are a similar level as before,okay? Aluminum price has been around INR 25, INR 24, INR 26, I think today it's become INR 26 and then INR 23. So aluminum, we are still on hold on aluminum because we don't need to supply today, okay? We still have at least another 2 quarters till we hold on, and I think the cycles are showing signs of coming down. On steel, obviously, we cannot hold on because that's the start of the project and that it takes a lot of time, okay? So which is why I said that in this quarter, we have brought down our fixed exposure from 25% to 30%. So I think roughly around 30,000 tonnes of towers. We have supplied on our old fixed price contracts thereby reducing our exposure significantly.

Understand. My last question is, what should one expect as the average debt for this year? We ended the year with INR 1,700, we are INR 25. But what is the average that one should expect for the fiscal year '22?

Rajeev?

So Bhavin, basically, as we have guided, considering the increase in turnover. We expect the average debt level to be over INR 2,500 crores. Last year was also on a similar level. It was only the, let's say, last 10, 15 days, higher collection that had pushed down the debt level to INR 1,700 crores, INR 1,800 crores. But if you look at the average debt level for the -- throughout the year, that was more or less at the same level. So we don't expect the debt level to go up because we are expecting a lot of efficiency on the working capital side to improve this year as well. And our focus has been to improve the working capital. So our average debt level will continue to be at the same level despite our increase in top line.

The next question is from the line of Saket Kapoor from Kapoor & Company.

Sir, out of the total cable business, what portion to does EHV contribute, sir?

EHV [Foreign Language] okay? So if I look at capacity-wise, I can do almost 30% from EHV, okay? Till now the orders have not been there now the orders have started picking up for EHV. So I think [Foreign Language].

Okay. And the total pie of cable order booking, sir, what is the proportionate? [Foreign Language]

[Foreign Language] Okay? So I don't have them and we don't even track in that fashion. But [Foreign Language], I can tell you the the [Foreign Language] it would be around INR 300 crores, INR 400 crores.

And how is ForEx played, sir, for this quarter, sir, the impact of ForEx?

ForEx, I think, we were positive by around INR 15 crores. Rajeev?

That's correct, Vimal. Similar basis than last year. So we had a INR 15 crore positive gain this quarter.

Right. Sir, Last point is on the, you are expecting that, say, commodity like aluminum, copper will make cooldown, say, 2 quarters down the line, [Foreign Language] what is the -- how much aluminum and how much copper are we unhedged out of the total requirement?

[Foreign Language] but copper would be fully hedged. Aluminum is not hedged for those tenders where the tenders were awarded to us late as we were [Foreign Language], okay? [Foreign Language].

Thank you. As there are no further questions from the participants. I now hand the conference over to Mr. Vimal Kejriwal for closing comments.

Thank you very much for your interest and continued interest in KEC. Thank you very much. And please stay safe.

Thank you.

Thank you. Ladies and gentlemen, on behalf of KEC International, that concludes this conference. Thank you for joining us. And you may now disconnect your lines.