Kilburn Engineering Limited (522101) Q3 FY2026 Earnings Call Transcript & Summary

Good afternoon, ladies and gentlemen, and thank you for attending this virtual meeting. I'm pleased to welcome you to Kilburn Engineering Limited's Q3 FY '26 Earnings Webinar. We have with us Mr. Ranjit Lala, Managing Director; Mr. Amritanshu Khaitan, Director; Mr. Sachin Vijayakar, Chief Financial Officer; Mr. K Vijaysanker Kartha, Managing Director, M.E. Energy Private Limited; and Mr. Amol Monga, Whole-time Director, Monga Strayfield Private Limited. Friends, this virtual meeting is being recorded for compliance reasons. And during the course of discussion, there may be certain forward-looking statements. These must be viewed in conjunction with the risks that the company faces. We'll have the opening remarks from Mr. Lala, followed by a Q&A session. Thank you, and over to you, Mr. Lala.

Thank you, Navin. Good afternoon to all. We welcome you all to Q3 2026 earnings call and updates on the company and its subsidiaries. Kilburn and its subsidiaries continue to deliver yet another consistent quarterly performance for Q3. A brief on the financials is as follows. Kilburn had a top line of INR 105 crores for the quarter Q3 with an operating EBITDA of 25%. This is a year-on-year growth of 15% on top line and 16% on EBITDA. On a consol basis, we achieved a top line of INR 157 crores and EBITDA of 24%. As a group, we ended Q3 with an order backlog of INR 495 crores, and we have received orders and LOIs worth INR 70 crores from 1st Jan till date. For the current year, we continue to have a healthy inquiry pipeline of INR 4,000 crores plus at a consol level, indicating a good traction across various sectors. We continue to maintain our target of 50% growth in top line over the last year, which comes to around revenue of INR 625 crores to INR 650 crores. The current margin profile looks quite sustainable, and we expect to close the year with EBITDA of around 22% to 23%. Furthermore, we have commenced the expansion of Kilburn factory at Saravali, which is expected to complete in the next 6 to 8 months. Also, we have commenced Phase 2 expansion at M.E. Energy at Pune. The third update, which I would like to give is, we have formed a joint venture company, Kilburn East End Private Limited for offering specialized site and shop fabrication services to EPC companies for various projects in refineries, petrochemicals, steel chemicals, et cetera. With this, I would hand over back to Navin.

Thank you, Mr. Lala. [Operator Instructions] We will take the first question from [ Sagar Shah ].

Sir, first of all, many congratulations for excellent set of earnings once again for Kilburn, it has been a phenomenal journey actually since last 2 years with you, sir. Now coming on to the operating performance actually, my first question was related to our capacities. Now with regards to Kilburn on a stand-alone level Ambernath plant and also M.E. Energy. So the potential to right now we are clocking on a standalone level, approximately, revenues of approximately of around INR 300 crores actually. On a standalone level I am saying actually, on a consolidated level, on a Kilburn level. So on that front, I might assume that are we fully booked out at least at our Ambernath plant as well our Saravali plant? And also regarding M.E. Energy and Monga Strayfield, I wanted to know what percentage of the orders actually are you executing on M.E. Energy's plant for Kilburn actually? And what percentage of the M.E. Energy's orders are being executed in that particular land. The next question was related to Monga Strayfield. What is the revenue for Monga Strayfield in the 9 months FY '26?

Well, Sagar, you know very well that we have always focused on consol numbers. So we avoid giving the split. But okay, for your benefit, I would like to mention that I'll give more the numbers which I'm expecting by the end of the year. So when we mentioned about INR 625 crores to INR 650 crores for Kilburn, INR 95 crores is what is -- INR 90 crores to INR 95 crores is what is expected from Monga Strayfield. Between INR 100 crores to INR 105 crores is expected from M.E. Energy and rest would be from Kilburn. This I'm talking as we see on 31st March. As of now, I think this should suffice your requirement. Secondly, you mentioned about capacity utilization or whether we are fully booked. Okay. Yes, we are well booked, I would say. And the expansions that we are talking about, we expect both these expansions to get completed in the next, let's say, 6 to 8 months. And all this is being done to get to the level of INR 800 crores plus. In the past, we have mentioned that next year, we are targeting a top line of INR 800 crores. And subsequently, we would like to be INR 1,000 crore company. So all these efforts are being put in that direction.

So basically got your point, sir, but the kind of orders that you are getting, I can see the order of INR 58 crore order that you placed on your corporate announcement, means more of tea dryers, more of other dryers, I think you are getting certain orders from. So something like, is it safe to assume that right now Kilburn on a stand-alone level rather than garnering high volume orders -- high value orders actually for rotary dryers, but it is getting some low value orders and focusing on something like you can say smaller products and garnering higher revenue. Is it safe to assume?

No. So we welcome -- you mentioned about tea dryer. So tea dryer is a very seasonal market. And it's typically from November to March, so that time we do have a spike. We are targeting orders of all values, anything from INR 40 lakhs in tea dryers to let's say INR 50 crores, INR 60 crores, INR 70 crores or INR 100 crores as well. I mean you have seen that in the past and the effort still continues. In fact, I would say for M. E. Energy, we had got 2 huge orders around INR 50 crores each. I don't have the exact numbers. But together, they were around INR 100 crores, and we are targeting more orders in that range. So it would not be correct to assume that we are targeting low-value orders. It was shared between various companies. It is not just Birla Carbon. upgrade from a credit rating company also, ACUITE actually in this particular quarter. So right now the cost of funds for -- how was it? It's anything around 11%, 11.54%.

In the INR 150 crores, INR 40 crores was rotary dryers.

Okay. So actually, I saw your export orders also. So basically, how much percentage of the total order book is from Birla Carbon, sir? Can you specify that, please?

They are 2 different things. Export orders you're talking about, this year, we expect a turnover of around 30% from exports, okay, in the current financial year. How much is for Birla Carbon and Birla Carbon may not be only for export. It could be for the local requirement also. I don't have the numbers immediately. Maybe Sachin, do you have the numbers of...

No, what only I can say out of our closing order book of Kilburn stand-alone around of INR 300 crores, around INR 70 crores is export related.

Okay. And how much is it from Birla Carbon? Do you have that number, sir?

No sir. It was shared between various companies. It is not just Birla Carbon.

I think you got a upgrade from a credit rating company also, ACUITE actually in this particular quarter. So right now the cost of funds for -- how was it? It's anything around 11%, 11.54%. So can we assume a lower cost of funds in the following quarters due to the upgrade in the credit rating?

Yes, definitely. We closed all our lenders, banks based on this rating and they are working on. And definitely we expect a reduction from the existing.

Okay. And can you specify about the JV, sir, that I think you have just in this particular quarter, you have signed a JV with -- you just mentioned in your opening remarks also. But I wanted to understand, means how is it different this piping fabrication, erection, structural fabrication and all these activities from rolling, building fabrication, you have been doing in-house. 2 years back, you had lack of space, but now you have the bandwidth also to do the entire activities in-house. Now this subsidiary onboard, means, what is the game? What is the plan of action? Are you looking to acquire another land or two basically for these different activities? Or is it the same level of activities that Kilburn on a standalone level has been doing actually right now?

So what we have been doing in our factories is more of building equipment in the country and supplying it to various customers and sites and assembling them. Now there is a business wherein a lot of site services are required and like fabrication, a little bit of manufacturing and site. And we are focusing only on the specialized activities. And the focus is on erecting static and rotary equipment, pipes tools, a little bit of structural erection for oil and gas, refinery, petrochemicals and chemicals, such factories. This kind of work is normally offloaded by EPC companies like L&T to smaller players. And this is a business which we are looking at. And to begin with -- I mean we would like to go one step at a time. So in the first year, we expect which would be in the next financial year, we expect to get an order in the range of INR 50 crores and we would like to execute that. Subsequently, we will see how things move and then we will grow accordingly.

Okay. So these activities, which you just mentioned, these are not right now being executed by Kilburn, but they have been outsourced to L&T actually that is the piping fabrication, structure fabrication and pre-erection, commissioning support, right for mechanical purpose?

Yes.

Okay. My last question, sir, was related to the tax rate. It's a data keeping question. In this particular quarter, also in the last quarter, we had a higher tax outgo actually. We have been paying tax at around 28%. So what is the tax rate that we will have to assume, sir, going forward?

It will be the normal 27% tax rate. 25% of surcharge, obviously.

We will take the next question from Abhijit Mitra.

I was just going through the last quarter transcript. I could see some of the comments from Mr. Lala and Amritanshu also that probably the margin profile around 25%, 26% will be sort of sustained through the end of the year and probably in the medium term also. So the drop in EBITDA margins this quarter, I know it's a mix of project, but I mean, how do you look at it? Do you see you can go back to that 25%, 26% range in the medium term? Or you feel this is the margin profile to expect?

So to the best of my knowledge, 25%, 26% was for last quarter. But we had mentioned that through the year, we will maintain EBITDA margin of 22% to 23%. We have been maintaining that for the last 3 quarters or over the last 2 quarters and this quarter. So 25% to 26% happened in last quarter. But through the year, it would be around 22% to 23% or rather by end of the year, it will be 22% to 23%.

Okay. So we should sort of model around 23%. And sort of -- I mean, that is the medium-term guidance as well, right, as in beyond the year also.

So beyond the year, we have mentioned it will be 20-plus percent. But yes, within the organization, we have put a benchmark for 23%. But for all our discussions, I have said 20-plus percent.

Okay. Got it. And in terms of order inflows on a consolidated level, we are looking at INR 443 crores for the 9 months. What kind of order inflows can we sort of expect for the year? And I mean, with this kind of order inflows, do you feel achieving the INR 800 crores revenue guidance can be a challenge?

No, not really. So we have closed as on 31st December, the open order of around INR 495 crores. But by the end of the year, based on the orders that have been received so far, the orders expected minus the execution that would happen, we would open the order book on 1st of April in the range of INR 500 crores, INR 500 crores plus. It will be very difficult for me to give a more accurate number. But we can assume that we will open at 500 plus, plus whatever comes in the first quarter. So that should help us in navigating into the INR 800 crore mark. Again, my dear friend, at this point of time, we are talking about numbers based on the scenario today, yes. So we have set ourselves a target of INR 800 crores for next financial year.

Got it. Understood. And regarding the follow-through orders from OCP, any sort of color on that, that you can share?

Well, discussions are on, yes. And it takes some time for all these inquiries to culminate into orders, but discussions are on.

[Operator Instructions] We will take the next question from [indiscernible].

Congrats on good set of numbers. I wanted to ask regarding export orders. So what is the EBITDA margin in the export orders? Are there the EBITDA margins higher? Or is it at par with the domestic orders?

All the export orders which we bag are definitely on a competitive basis, not necessarily that we are [indiscernible]. But the margins are by and large with the domestic orders. There can be some cases. We have mentioned in the past that OCP order from Morocco was a higher margin order, but it depends from time to time, customer to customer, yes. So we -- it's very difficult to really say that all export orders have a higher margin.

All right. And sir, one last question related to the like INR 650 crore target for this year. So like in Q4, we should be around INR 200 crores of revenue if we want to target INR 650 crores. Is it right?

Right. INR 625 crores to INR 650 crores, let's say where we land. Yes, but you're right. The top line should be in the range of INR 175 crores to INR 200 crores.

[Operator Instructions] It's from Ankur. A few questions. Will we be able to achieve INR 650 crores to INR 700 crores in FY '26?

I'm more confident on a number between INR 625 crores to INR650 crores. Second, the margin has decreased from...

Just to add, the INR 625 crores to INR 650 crores is the number which meets our guidance of 50% growth.

Yes. So this is based on the 50% growth over last year, what guidance we had given. But if we are able to cross INR 650 crores, we will not stop ourselves. Yes, please go ahead.

The second question, the margin has decreased from 26% to 23% this quarter. What is the reason for this decline? And what margin do we expect in Q4 and FY '27?

Consistently, we have been mentioning that margins will change from quarter-to-quarter based on the type of orders being executed. And the guidance that we had provided for the whole year was in the range of 22% to 23%. We stick to that.

The last question from Ankur. Do you expect cash flows to improve in FY '27?

Sachin, can you take that?

Yes, we expect to improve cash flows next year. Because of banking facilities, enhancement of banking facilities definitely [indiscernible].

There are some questions in chat, friends. Do you have a follow-up question? Sir, as you said that the margins fluctuate a bit depending on the type of orders we receive on quarter-on-quarter. So can you share some insights like some of the areas where margins are high so that in particular quarter, we report 26% to 28% of EBITDA margins?

No, sir, it's very difficult to give such a projection here. And in the last quarter, we had relatively high because we executed the OCP JESA order for Morocco. A part of it is still being executed in the current quarter. So this will change. And each order has different margins. It's very difficult to give a projection as to which quarter it can be high or low. And that's why we give quite a narrow range. So when I talk about 22% to 23%, we have taken into account all the possible ups and downs and any surprises and all those things. But I can assure of one thing. At any point, we try our best to improve our margins, whether it is through scaling up of activities, efficiencies in our processes, trying to work out good prices for the raw material, that is something which we do consistently. And that's why you find these fluctuations.

[ Sahaj ] is asking what should we -- want to understand the impact of EU trade deal? Will the European machinery get cheaper for Indian clients? And can it impact our order book?

Right. So I will try to answer this question from both the angles, EU India trade deal and the U.S. India trade deal because I'm sure somebody would have a question on that. I don't think Europe is in that position today to offer cheaper equipment. In fact, it is the other way around. If they want to increase their capacities, they would look at equipment from India and other countries like China, Vietnam, et cetera. So in a way, it's beneficial for us. Same likewise for U.S., if they have to import any equipment and all, so India is very well placed and vis-a-vis even Kilburn is well placed to supply for the business that we are doing, that is drying solutions or heat recovery solutions and radio frequency dryers. So it's beneficial to us. However, this would take around 12 to 18 months for the real green shoots to be visible on the ground because these have to be passed in their respective countries, these trade deals. I think in the EU Parliament, this has to be passed for the India EU agreement. So by the time we really start seeing the benefits, it would be 12 to 18 months from now. But in these 12 to 18 months, a lot of groundwork can be done by companies like Kilburn in terms of tying up with technology partners or looking at potential customers and trying to have ventures in any form. So we will work on those, meanwhile. I hope that answers your question, sir.

I will just take a few of them which have been posted on the chat. [ Raksh ] Malhotra has posted, sir, when you say INR 800 crores and INR 1,000 crores for FY '27, '28, what will be the EBITDA and PAT margin guidance? Also, which division, customer segment are we seeing faster growth?

Okay. So when we talk about INR 800 crores, INR 1,000 crores, as on date, my figure would be same, 20-plus percent. As we go forward, we'll further fine-tune and let you know what the numbers look like. I do agree that when you scale up your activities, your margins improve. But at this point of time, it would be a little difficult for me to give indicators for the next financial year. So I stick to 20-plus percent. Now which sectors or customers are doing well? I think we are having traction across various segments. So when you look at what are the kind of inquiries we have, I can speak from that perspective. We have plenty of inquiries from petrochemicals, chemicals, soda ash, fertilizers, a little bit on nuclear, food processing, metals, recycling. So we are seeing traction in all these fronts.

I hope that answers your question. Can we take the next question from -- Abhijit Mitra has a follow-up question.

Just want to understand what was the OCF for the first 9 months and what's the incurred CapEx for the first 9 months? And how much CapEx do you intend to do for this year?

CapEx for first 9 months was around INR 5 crores to INR 6 crores.

Sorry, I missed that number.

CapEx was around INR 5 crores to INR 6 crores for the first 9 months.

Okay. And what was the operating cash flow?

Cash flow, I don't have the figure in front of me.

No. CapEx you're saying. You said cash flow...

The operating cash flow figures I don't know.

And yes, for the full year, what's the plan in terms of planned CapEx, if you can share the number for the full year?

When we had planned for the full year, it was around INR 25 crores for Kilburn and around INR 10 crores to INR 12 crores for M.E. Energy, but we did not consume it. There was a slight delay in getting approvals for the expansion. So for all practical reasons, you can assume the same would be spilled into the next financial year. Whilst we have started the expansion in both these locations, but the CapEx would follow in the next financial year. The total CapEx for both the companies would be around INR 40 crores to INR 45 crores for M.E. Energy and Kilburn. I also want to mention that we have some CapEx planned for Monga Strayfield. We are waiting for the necessary inputs before we give you those numbers.

Got it. INR 40 crores, INR 45 crores over 2 years?

No. Over 12 months. So let's say, this quarter and next 3 quarters.

Okay. There's a question from Daksh Malhotra on the chat. Sir, as we are seeing a lot of euphoria around nuclear, even in our order intake, nuclear is a big contributor. Can you talk about what are we supplying? And how is the space looking?

So what are we supplying? I can give some information because there's only a limited information which we are allowed to give out. We had one order from Nuclear Power Corporation, which was for design, engineering, manufacture and supply of pump room coolers and some wall coolers plus heavy water vapor recovery system. So this was the solution that we are offering them. The second order was from Heavy Water Board, which is for supplying of reactors, exchangers, hydrogen pumps and piping and structures and all. I would say it's more of an EPC kind of a supply for some special processes which have been designed by BARC. What are those processes? We are aware a little bit of it, but I will not be able to speak on that subject. How is the sector doing? We expect a lot more to happen in the coming years. These 2 orders which we have spoken about, we have been working on them for more than a year now. And we are working on a few more -- a couple of more inquiries, which are quite at an advanced stage. But we expect a lot more to happen in this vertical or in the sector, more so after the trade deals that have happened.

Sagar has a follow-up question.

I just had 2 follow-up questions. On the standalone level, for Kilburn Engineering, so we have around 2 plan, Saravali and Ambernath. So in FY '27, when you are actually guiding for around more than INR 600 crores plus of revenue, INR 70 crores plus of revenue, so I think this growth will be largely led by M.E. Energy and Monga Strayfield, if I'm not wrong?

No, I think there has been a growth on all the fronts. I mean if you just look at stand-alone numbers of Kilburn, you are definitely seeing a growth. And if you look at Kilburn plus M.E., even there we have seen a growth and we expect that by the end of the year a lot of revenue or top line from M.E. as well...

Sir, I was talking about FY '27, sir.

FY '27, we expect biggest growth coming from M.E. Energy.

Yes, that's what I was saying, sir. Because if you are fully booked out, you have already large orders being coming from the carbon black industry, also from nuclear and the petrochemicals. So I can hardly see any room for growth on the Kilburn level.

No, not really. Sorry. I mean let's keep the 2 things separate. The growth of Kilburn will always be there. But in '27, we are seeing a good growth coming from M.E. Energy. And this is based on the inquiries that we have and the stage of negotiations where we are today. So that's where I'm saying that the maximum growth will come from M.E. Energy.

And from the cement industry, are you expecting orders?

Yes. Cement, from steel, from power, from a lot of areas we are expecting. Actually, Mr. Kartha is also online. He can throw some light on that. Mr. Kartha, can you tell something about...

So at M.E. Energy, we've been able to source some more -- get some more orders from the cement industry after the first breakthrough with Shree Cements. And we have got during this year, large orders for the ferro alloy industry and that is leading to more number of inquiries in metals and steel industry. And next year looks pretty good for us, and we are gearing up with a major expansion of the plant, whereby the capacity in terms of space under crane for production going up almost close to 50%. So we'll be equipped with almost double the capacity for catering to this spurt in growth. So things are looking ahead, and it's good times for us coming ahead.

Okay. Sure, sir. And my last question, sir, was to Sachin, sir. There was a conversion of circa around 350,000 warrants in this quarter. Now actually, what I have forecasted that of the total equity share capital after the conversion of the warrants to the public shareholders would be around INR 52.6 crores. Am I correct, sir on the equity share capital?

5.62 crores shares?

Yes, correct. So it comes up to INR 52 crores, INR 60 lakhs is the share capital.

Tejash, you have a question?

So, just from what I gather, you sounded very bullish in the Q2 of this FY. I think this call as we've been hearing, I think we sound a little bit subdued. So do you face -- are you seeing any major challenges because even if you look at the top line, obviously, you always guided 50% growth. And we probably hit somewhere around maybe INR 620 crores, INR 630 crores, the number you've given. But from the business perspective, are you seeing some headwinds that you're facing, maybe not headwind, but some challenges that you're facing up in this quarter and you feel that should propel it down maybe to the next year as well?

Well, first of all, I don't know what makes you feel that they are subdued. Is it my voice that is subdued or...

So let me correct myself. I meant that, I'm used to -- since I've been following the company in the last 2 years, I'm used to seeing the feel of what is more bullish. I think this time we were more, I would say, restrained if not subdued. So I thought maybe the industry challenges...

We have always mentioned that in the following years from now, that is '27 and '28, we have projected a CAGR of 25%. As of now, I don't see any challenge over there. And if you look at where we have reached so far, like from last 2 years, whatever we have projected, by and large, we have been closer to that number. So when we talk about 25% from here on, so INR 625 crores, INR 650 crores, another 25% would be INR 800 crores and then another 25% will be INR 1,000 crores. So those numbers, we are still maintaining. See, you need to have some benchmark or some numbers in your mind when the organization is moving ahead. There can always be some plus/minus here and there. Now are we confident? We believe that we are going to achieve that number. And this is all because of the kind of inquiry pipeline we have, the traction that we have seen in multiple verticals. A couple of months back, people had a question mark on M.E. Energy's performance. I mean now we are saying that they will be the fastest growth ones in the whole group. So the efforts have been put. The opportunities are being uncovered. And I think we are placed where we are supposed to be. And I'm not sounding subdued now.

No, you're not. I was just trying to -- I'm just used to it.

It's very difficult to give a range for a growing company. I think we must maintain that if we are able to achieve the INR 625 crores to INR 650 crore range, it's a 50% growth, albeit with 20% of that coming through an acquisition. Going forward, if the company can maintain a 20% to 25% range, I think that itself will be a great achievement for Kilburn base because the base itself is becoming larger.

I understand that. Sir Lala, I'm asking because I'm used to the benchmark that you have said. So please pardon me if I'm maybe trying to sound more optimistic. I think it's all the credit to Kilburn and your team trying to do that.

[indiscernible] by setting higher bench.

Sorry. Sir, second question was the order book that we have, INR 495 crores closing order book that we have for...

Plus INR 70 crores that we have received.

INR 70 crores, that is received. So what is the -- so 305, 306 is Kilburn. Do we give the split for M.E. and Monga in that, sir, the remaining...

I am trying to see if I can give you. Sachin, can you give a split?

M.E. is 170 and Monga is 20.

Sorry, what was Monga, sir?

Monga is 20.

Last question. I don't know if our companies anywhere associated with these water discharge and ZLD kind of projects because I feel that's what has been in demand right now, zero discharge kind of thing. Are we associated with that in any which ways?

Yes. So both M.E. Energy and Kilburn are working out on opportunities in the sewage treatment plant, STPs, both municipal and private, not necessarily ZLD because if it's a municipal plant, it cannot be a ZLD. You can only treat this sewage and release it. So we are working on a couple of opportunities. And we are also looking at a couple of technologies where we can tie up. So that process is on. Maybe Mr. Kartha can dwell more on that. Sir, can you give some more information, sir?

Yes. M.E. Energy had been working in this field of sewage treatment through various CPC contractors for all these municipal bodies wherever a large sewage treatment plant comes. And it is by way of supplying the required thermal equipment for the processing of sewage and also biogas-based heating systems and engine heat recovery systems. So this is going on even in this quarter, we have booked around INR 5 crores, INR 6 crores worth of order in this space. And the plants in India are going up in size. Earlier, it used to be 100 TPDs and things like this 100 KLPDs and all that. Now it is going to be 400, 500, and we expect that in the coming years, the order intake will be much higher values and more in numbers.

We'll take the next question from Ravindra Naik. We will take the question from Kartik Bhat.

Congratulations to the whole team for a good performance. Most of my questions have been answered. So one question on the event participation, ChemTECH World Expo event that you mentioned in the investor deck. So if you can just speak a little bit as to have we participated in it in the past or was it the first time? And maybe some color on the response that we received there and the nature of inquiries received and so on?

I can partially answer that question. So this is not the first time we are participating in ChemTECH. We had done it for the last 2 years as well. But this was at a much bigger scale. In terms of response, I would say it was -- the response was overall modest to ChemTECH as an exhibition. So it's got nothing to do with Kilburn or anybody else. So I mean that's all I can say. About the inquiries, what we have generated, honestly, I don't have the information so far because it just got completed last week and my colleagues are working out the details. So that is one part I'm not able to answer.

[Ravindra], please unmute yourself and go ahead.

Can you please give a sense on this stand-alone number sector-wise, your exposure in the nuclear. I joined a little late. If you have already dealt upon this, then okay, but can you please repeat it, if at all, you have not done. Then I will take up some questions.

Ravindra, I would not have the numbers sector-wise for stand-alone. But what I can recommend is that you can refer to the presentation, which is in the public domain. That will give a fair idea as to what is the overall breakup of the orders. This is on Page 7 of the presentation.

Yes, I understand. Can you please give the inquiry level and the sector-wise, anything can get a sense on how the things are moving on.

See, I can name the sectors where we have inquiries. I will not be able to give you the split. So I mentioned earlier that we have a number of inquiries from petrochemicals, chemicals, soda ash, fertilizers, metals, nuclear, we have a couple of them. Then we have recycling and I think we have also on the offshore platforms. Yes. So these are the verticals where we are seeing a lot of inquiries. The split, I would not know. It's very difficult to give that.

Okay, fine. So otherwise, if you see what is the inquiry level right now, what are the total inquiry level of order entire on a consolidated basis we are working with and what it was in last quarter. So can you get a sense on that?

So I think in the last 2 to 3 quarters, we have been having an inquiry pipeline anywhere between INR 3,800 crores to INR 4,000 crores, okay? It keeps fluctuating from time to time because new inquiries are flowing in, conversions are happening. There are always some orders won, orders lost. But on an average through the year, we had a good inquiry pipeline of INR 4,000 crores at a consol level.

Okay. So at this moment, you are working at INR 4,000 crores of order pipeline, right?

Yes.

I believe that you are giving this indication for the not consolidated -- fully consolidated. Can you give it from the M.E. Energy and Monga for separately?

Well, we prefer not to. But for your benefit, I'll just give you a broad breakup. If we are talking about INR 650 crores, I would expect somewhere between INR 90 crores and INR 100 crores from Monga Strayfield, somewhere between INR 100 crores to INR 105 crores, INR 10 crores M.E. Energy and rest from Kilburn. But this is only an indicative number. But we prefer not to give any split at this point of time.

Okay. Sir, regarding this, you have mentioned that you will be working with INR 625 crores to INR 650 crores. So what would be the stand-alone number for expected stand-alone number for FY '26 and for the other 2 subsidiaries, Monga and...

I just answered that question.

So split-wise, you cannot give, the subsidiary-wise. Anyway, stand-alone, what is the expectation, sir?

INR 450 crores to INR 500 crores.

And sir, regarding my question to, what is the total cash book right now, cash in hand of the company?

Cash in bank as on 30th December was around INR 30 crores.

INR 30 crores?

INR 30 crores, margins, everything. Whatever.

INR 13 crores?

INR 30 crores.

And sir, what is the borrowing right now by 9 months?

Ranging from 9.5 to 10.5.

No. I'm not asking cost, sir. What is the total gross borrowing?

Borrowing? INR 100 crores plus, including what we have borrowed from our subsidiaries.

And sir, there was supposed to be around INR 95 crores of equity warrants to be money to come. So whether it has already received or it...

It will be by May '26. After listing balance will come by May '26.

Okay. So INR 49 crores has already come. The INR 95 crores is expected by May '26?

Yes. Around INR 138 crores yet to come, INR 130 crores.

Okay. So out of that, you mentioned the total capital expenditure this year would be around stand-alone INR 20 crores and others subsidiaries, sir?

We already mentioned that. Because of the two companies, it will be around INR 40 crores of capital expenditure over the next 12 months.

We'll take the next question from [ Priyesh Babaria].

Just wanted to understand from the perspective of order pipeline since it is kind of flat over, let's say, last 2 to 3 quarters. First on, how do you actually consider some orders as order pipeline and why it has not been actually growing considering the TAM that we are actually targeting at? And then the next question is with respect to, let's say, whatever the expansion that we are doing, would that CapEx would be sufficient to actually generate the revenue of INR 1,000 crores?

So the question number one, see, you don't see much fluctuation quarter-on-quarter in the inquiries pipeline. You're converting some. There are new opportunities getting uncovered or explored. So I just mentioned that we have had inquiries between INR 3,800 crores to INR 4,000 crores, and they have been consistent. So I would not say they are flat, they are consistent. Definitely, as we move forward, these will grow. If you look at the last 2, 3 years, we were somewhere around INR 600 crores to INR 800 crores once upon a time. From there, we have grown to INR 4,000 crores. So I would request you to look at a broader period than just quarter-on-quarter in the last 3 quarters. That's one. Secondly, you mentioned about the expansion. This expansion is being done so that we crossed the INR 1,000 crore mark. It is now being well planned in advance. So yes, with this expansion, will we touch INR 1,000 crores with all the opportunities in place? We will touch INR 1,000 crores.

A couple of follow-up questions. Tejash, do you have a follow-up question?

No, I haven't raised my hand.

Abhijit, do you have a follow-up question?

Yes. I just wanted to sort of get a bit more clarification on the margin front. So if we look at the gross margins, both at stand-alone as well as in consol, so essentially the cost of raw mat plus contracting plus change of inventory and others. So we don't see much of a margin dip there. So the other expenses which have increased significantly, which is drawing the margins down. So if you can help us understand the nature of the costs that are accruing here and probably that will help us understand this delta in margins a bit better.

The other expenses keep on fluctuating. Other expenses include expenses like freight, freight and forwarding, professional fees, then our employee cost also if you see. So that is where -- our other expenses basically also includes a provision towards expected credit loss, which keeps on fluctuating depending on the increase or decrease in the debtors' level as well as the level of our [indiscernible]. So that in some way are varying.

So essentially from, say, INR 18 crores in Q1 to INR 24 crores in Q2 to INR 29 crores in Q3, I mean this delta is there a couple of line items which can explain this delta in terms of either ECL or probably some specific cost related to execution of some...

Over the last 2 quarters, we have had very high exports, where the freight cost has been substantial. So that cost has increased the other expenses. So there are various other types of expenses, which are incurring.

Okay. And my second question was that given the inflation in raw materials that we have seen, say, over the past 2, 3 quarters, so how are you sort of creating contingencies for that?

Yes. So typically, whenever we are negotiating any of our orders with the customers, we are aware of what are the raw materials need at that point of time, okay? And if we receive an LOI or a purchase order, typically the LOI, we immediately block 80% of our raw material with our vendors. So it's an immediate back-to-back arrangement. On the rest, 20% is easy to manage and we don't find any challenges. This facing of order or blocking raw material slots is done within 72 hours. So there, we don't see any fluctuation. That's how we have been mitigating this for the last 2 years.

Got it. Understood. So you don't expect to sort of -- I mean, this margin profile can be maintained irrespective of the raw material changes you feel, at least for now?

The old fluctuation that you see maybe 1% to 2% quarter-on-quarter, maybe raw material may be contributing to it. It's very difficult to say what are the biggest contributors. The point I'm trying to make is that 80% of it is very well mitigated. Being in project business, we do some projections as to there could be some fluctuations here and there. There could be other cost overruns, okay? There could be some unexpected delays. There could be some unexpected challenges. So all these together contribute to that fluctuation, which is not very big, I feel.

Got it. Sir, for example, if I look at your past annual report, I think contract assets less contract liabilities is a significant part of your working capital cycle. I could see in '25, it is almost 106, 107 days. So on that part, work has been done, but probably billing has not been made or payment has not been received. On those particular type of situations, if the raw material prices increase, how do you sort of -- I mean, does that get passed on easily? Or there are clauses before where you sort of...

So there is no pass-through mechanisms over here. Because all these orders are on a fixed rate basis. Now whatever fluctuations you are seeing, that's the nature of business. We operate on a POC basis. And when you say POC basis, the raw material is already into the factory. It is just that it is under some stage of fabrication, okay? Since the overall top line is growing, obviously, this impacts the overall work in progress.

[ Dinesh ] we can take your questions, but please limit yourself to just one because we don't have lot of time. Ravindra, please share your follow-up question with me on mail. I'll take it up with the management.

Really great numbers.

You are normally among the first guys to ask the question.

I just thought like let's give others some opportunity as well. Sir, my question is, I see we are catering to different industries, a lot of them across geographies. Any plans or chances that we can get into A&D as well, aerospace and defense or to a large extent? The reason...

It would be on a wish list, I don't know how far it is. As of now, I'm not seeing any opportunities for us. We are too occupied with what we are doing. But yes, maybe someday.

We look forward to that as well.

As I mentioned, we've run out of time. So in case there are any unanswered or follow-up questions, please send them to us on mail. We'll forward them to the management and revert to you. I'd now like to hand over the webinar to Mr. Lala for his closing remarks.

Thank you, Navin. Well, just to summarize, what I can say is that, as a team, we believe that the target that we have set both for the top line and EBITDA margins, we should be able to achieve it. The CAGR of 25% for next 2 years and the EBITDA of 20-plus percent, that also seems to be very much possible. If there's any change or anything unforeseen, we will definitely keep you posted. Both our expansion at Saravali and Pune and maybe in future at Monga Strayfield, it should help us in improving our -- growing our top line, I should say. We are constantly evaluating any opportunities for inorganic growth as well. And yes, that's all from my end. I think I can just sum it up in these few statements, and thank you so much for being on this call.

Thank you very much. On behalf of all of us at SKP, thank you very much, Mr. Lala, Mr. Khaitan, Mr. Vijayakar, Mr. Monga and Mr. Kartha for your time, and we look forward to hosting you again for the next quarterly call. Thank you very much. Thank you, everybody, and have a wonderful day.

Thank you very much.

Thank you.