NCC Limited (500294) Earnings Call Transcript & Summary

Good evening, everyone. Welcome to NCC Q2 FY '21 Earnings Conference Call, hosted by PhillipCapital. Today, we have with us the management of the NCC, represented by Shri R.S. Raju, Associate Director, Finance and Accounts; Shri Y.D. Murthy, Executive Vice President Finance; and Shri S.V. Durga Prasad (sic) [ Shri A.S. Durga Prasad ], Joint General Manager, Finance. As promised, we will first have a small opening comment by the management. After that, we'll open the floor to Q&A. Over to you, sir.

Yes. Thank you, Vibhor. Good afternoon, all the participants. I'm Y.D. Murthy from NCC. We will give you the opening remarks about the second quarter performance of the company. I request my colleague, Shri R.S. Raju, to do his opening comments. Thereafter, we can take up the Q&A session.

Okay. Thank you, Mr. Murthy, and good evening to all of you. So first, let me give the opening remarks about the Q2. Thereafter, the questions, and also, if any other matters, and my -- Mr. Y.D. Murthy will supplement those matters. So first, I will explain about the order book. The company has secured orders in the second quarter rupees -- about INR 2,962 crores, and also we have some increase/decrease in orders about INR 86 crores. If we add that INR 86 crores also, the total orders available for execution were INR 3,048 crores. And as against company's planned order book of INR 3,500 crores for this quarter we stipulated, total orders secured are about INR 3,048 crores. I will explain the segment-wise how the order book goes at the end of the second quarter. The Building division, we have at the beginning of the quarter, INR 13,241 crores and now stands at INR 13,625 crores, 46% of the order -- total order book. Roads stands at INR 2,644 crores in the beginning, and now stands at INR 2,220 crores, 8% of the order book. Water & Railways stands at INR 4,660 crores at the beginning, now stands at INR 7,373 crores, 25% of the order book. Electrical division at the beginning INR 1,711 crores, 6%; and at the end of the quarter, INR 1,808 crores, 6% of the order book. Irrigation, INR 2,054 crores and INR 2,402 crores. Mining, INR 1,912 crores, INR 1,666 crores. International, INR 95 crores, now the closing balance at the end of September is INR 15 crores [Audio Gap] So at the beginning of the quarter, INR 26,572 crores and at the end of the quarter, 29,362 crores. So the order book movement in the first 6 months is more or less close to the -- whatever we targeted. And thereafter, about the orders, there are a good number of orders are in pipeline, and the company's confidence about the booking of the orders in this current year, about 40% to 50% more than what is received in the last year. As far as the revenue and the loan, in the second quarter, reported turnover of INR 1,541 crores, excluding other income, and INR 1,500 crores, including other income, as against INR 1,802 crores reported in corresponding quarter the previous year, a decrease of 12%. The quarter-on-quarter, there is an increase about 30% in the second quarter compared to our earlier quarter or on the first quarter, an increase happened by 30%. And because of the COVID-19, you know that first quarter, our progress is about 55% to 60%. And now gradually, an increase has happened in the progress, and we observed about 75% to 80% momentum is there. And we expect to reach further momentum in third quarter, 85% to 90%. And it will reach 100% of the normal, pre-COVID normal, subject to the COVID-19 behavior. Now there is a decline happen in the last month. But again, now for the last 1 week, 10 days, there is an increase in the positive cases. And if any, again, on the [ math ], because of increase in COVID-19, and the local agencies or in state government or central government takes any special measures like lockdown and other things, there will be an impact. Otherwise, if the same kind of whatever trend is there, if it continues, certainly, we'll reach 100% to pre-COVID normal in March in the final quarter of the current year. About the gross margins in the second quarter, it reported 21.72% as compared to 19.87% in the first quarter. So there is an increase by about 1.34% in the gross margin in this quarter. And EBITDA stand-alone, also increased by 0.16 percentage from 13.45% to 13.62% -- no, no. This is compared to the previous -- corresponding quarter of the second quarter. I will -- now I indicate the quarter-on-quarter increase is by about 3.8% from 9.81% to 13.62%. So the net profit in the second quarter reported 3.7% as against 1.4% of the first quarter. And the EPS reported INR 0.96 as against INR 0.28 in first quarter. So as far as interest cost is concerned, there is a decline in the second quarter as compared to the corresponding quarter the previous year by about INR 13 crores, so from INR 130 crores to INR 117 crores. So the decrease in interest rate -- the reason for the decline in interest cost is primarily a decline in the interest -- average interest cost of the borrowings made by the company. Moving to employee costs. Also, there is a good decline happened because of this -- some special measures taken by the management, considering the volume of the business and also the -- this COVID-19. So as a result, employee costs decreased by INR 32.65 crores from INR 115.27 crores of the corresponding quarter the previous year to INR 82.62 crores in this quarter. So certain savings were happened in the employee cost, administrative cost and interest cost in this quarter, which helped the company to, again, at least to report a moderate level on the margins. On a -- now I'll read out the consolidated performance of the company. The revenue increased from INR 1,298 crores to INR 1,708 crores on quarter-on-quarter basis, and the increase is about 32%. The gross margin also increased from 19.76% to 21.76%, by about 2%. EBITDA increased from -- in absolute terms, INR 125 crores to INR 232 crores quarter-on-quarter. The net profit increased from INR 15.68 crores of first quarter to INR 64.6 crores, and in terms of percentage, from 1.2% to 3.7%. But the EPS increased from INR 0.26 to INR 1.06. So about the balance sheet, the major numbers in the balance sheet is debt. The debt in the books has come down by about INR 47 crores in the second quarter from INR 2,051 crores to INR 2,003 crores. Now about the CapEx of the company, in the second quarter, hardly, we spent about INR 17 crores on the CapEx. So about the cash flow, the cash flow generated from operations is about INR 110 crores. The cash flow generated from investing activities, INR 47 crores and the cash flow utilized in financing activities is about INR 181 crores. So there are positive cash flows from the operations as well as investing. And the same thing we have used for repayment of the loans and also to service the interest on such loans. The trade receivables are concerned, there is a little decline was happened INR 2,618 crores to INR 2,536 crores. This is about the general -- about the results.

I will add 1 or 2 points to what Mr. Subba Raju has stated. He has already talked about the order book. In the first 6 months, we got orders of about INR 5,640 crores. In the month of October, we received 1 more order of about INR 833 crores in the Mining division. So the total threshold of accretion in the first 5 months of the -- 6 months -- sorry, 7 months of the current year, up to October is about INR 6,327 crores. We have given a guidance of about INR 10,000 crores for the threshold of accretion in FY '21, and we are confident we will not only achieve that, we are likely to surpass that also because the order flow is likely to improve in the third and fourth quarters because the government is planning a lot of infrastructure projects to kick start the economy, and flow of orders is likely to increase. So there could be a positive variance as far as the order booking for FY '21 is concerned. Right now, we are sitting on a comfortable order book. And also, if you look at the second quarter performance in comparison to the first quarter, already, the sequential growth in the top line is more than 30%, and the sequential growth in the bottom line, that is second quarter profit as compared to first quarter profit, is about 245%. As well, for INR 16 crores in first quarter, we reached the level of INR 58 crores in the second quarter. These are clear indications that the company is recouping the losses that we have suffered in the first quarter in terms of turnover and less profit. Things are slowly but steadily falling in place. We are already looking at execution level of about 80% in the month of October, and that is likely to go up to beyond 90% of normal levels by the fourth quarter. So we believe we are on track as far as the top line is concerned. On a stand-alone basis, we have already done a total income of INR 2,789.5 crores in the first 6 months. And the balance 6 months, the second half is definitely going to be far better than the first half, and we are confident we will be able to achieve the targeted turnover of INR 7,700 crores for FY '21. As far as the...

Hello?

Debt levels are under control. Already, Mr. Raju has told you about the debt levels. And the interest costs have come down substantially based on various measures taken by us. And the banks also supported us. The WCL rates have come down substantially with number of banks in the consortium. And over and above that, we've got COVID loans, about INR 180 crores at concessional rates linked to MCLR, without any spread. That also helped us to bring down the interest costs. And at the end of second quarter, the blended interest cost of the bank borrowings is around 9.3%, which is one of the best in the industry, and we hope that will continue. Likewise, we are expecting the BG commission and the LC commission charges also to come down in the next round of April, given the sanctions by our consortium banks. And as far as the loans and advances are concerned, they stood at about INR 558.8 crores at the end of the second quarter, not much change. And the investments also stood at INR 889.25 crores, a slight reduction compared to the first quarter, but the group exposure was INR 1,448.1 crores for the -- at the end of the second quarter. We are planning to bring it down progressively as we go forward and bring it down to below INR 1,000 crores by end of the 2 years time from now. And the mobilization advance is about INR 1,271.5 crores. Retention money is about INR 2,308.9 crores. Cash on bank balance are about INR 322.3 ] crores. Inventory is INR 464 crores. As far as the cash balance are concerned, some banks are asking us to provide cash margin for the bank guarantees, about 5% or so. So there is a buildup of our margin money lying with the banks, so that has boosted the cash on the bank balances as on 30th September. And as far as the debt collection period is concerned, we have reported 170 days at the end of the second quarter, which is pretty high. But going forward, the debt collection period is likely to come down. So what has happened, a number of state governments are focusing their attention on COVID measures, on health care measures, welfare measures. With the result, the payments to the contractors are getting delayed, that is one cause for concern. We are putting our best efforts to see that payments are received. But as far as central government agencies are concerned, like the Airport Authority of India, All Indian Institute of Medical Sciences, defense projects, there are no delays. Payments are coming well in time. And even the Nagpur-Mumbai Expressway, the payment cycle is pretty good, and the execution is also picking up there. So we are happy to inform the investors that the company is on track in terms of coming back to normal operations. And as far as the liquidity is concerned, absolutely, there's no problem. We are able to manage our affairs very nicely without any working capital tightness. In fact to the moratorium granted by Reserve Bank, we have not taken for interest payment. And also the deferment of installments for term loans, also we have not taken. But all the interest payments to the banks, we have paid in time. Of course, the banks also supported us with the COVID loans at a consistent rate of interest. All these measures helped the company to see that the liquidity position is maintained at a comfortable level, and the company is able to take care of all its obligations with the lenders, with the suppliers, with the subcontractors well in time without any difficulty. These are some comments I wanted to make, and as we go forward, other information also we'll give you. Now I request the participants to ask your questions. [Operator Instructions] Please go ahead.

[Operator Instructions] The first question is from the line of Mohit Kumar from DAM Capital.

Sir, congratulations on a good set of numbers. Sir, two questions from my side. So first is on, of course, the second half as per our projections, as per our guidance, I think we are building a decent amount of growth for H2. Will you comment on what kind of labor availability you have achieved? And are you facing any issues in terms of labor or execution at any of the sites?

See, labor availability has improved. When we're talking of 80% execution, two things are involved: one is the material and the manpower. Earlier, we suffered because the supply chains have been disrupted because of the lockdown, particularly in the month of April, even raw material supplier project sites was a problem, but that is totally behind us. Supply chains are restored, national highways are open, payments -- I mean, supplies are coming well in time. The only issue -- the other issue was that of labor not being available as many of the labor have gone to their native places. They were held back at the relief camps at the state borders. That created a big issue, and the labor was neither coming to the project site nor going to their native places for some time. And once the lockdown is removed, many of the labor preferred to go to their native places. Understandably so, they are under stress, and many people walked miles and miles to reach their native places. But all those things are, again, coming back to normalcy. We are also proactively seeing that labor comes back in time and participate in the execution process. That's how the 30% execution in the month of May has now become about 80% in the month of October. And going forward, we are very confident, particularly after the festive season is over, after Diwali, all the labor is likely to come back to the project sites and the normal working. And the rains are also behind us. And so the normal working will start from the middle of November until the end of the year.

Okay. As -- we are confident of achieving the H2 numbers of growth compared to last year, same last year H2. Am I right?

No, no, I'm not saying that. That is difficult. That is difficult. What I'm saying is the Q3 and Q4 together, we are likely to achieve a top line of about INR 5,000 crores, which means for the year as a whole, we'll be able to achieve a top line of about INR 7,700 crores.

Understood, sir. Sir, my second question is on the working capital, which the -- they received -- they were stuck on the AP side, Andhra Pradesh. Have you seen any movement? Can we please comment on that?

Yes. My colleague, Mr. Raju, will tell about that.

As far as working capital is concerned, and in general, it is good, and we are not seeing any good blockades or major amount of blockades across India. But in general, the collections are good from the clients. And 1 or 2 states, then there are -- some constructions are delayed there, particularly the AP state you're asking. In the AP state also, there is a movement of the collections, and there, some of the work in progress earlier, what we've done, they certified and released payments in some of the projects. And in AP, some projects are related to capital city and some projects are related -- not related to the capital city, they're in a different locations. So they are in the execution, but not at a speed. They are in execution to the extent the funds releasing by the government. So in the second quarter, we released -- we received almost INR 120 crores and another INR 37 crores in the October and about INR 157 crores or INR 160 crores we received from the AP government despite the COVID-19 and despite the state government budget problems. So like that, there is a movement in the AP and continuous dialogues are happening about how they prepare -- they make the payment, how much they pay. And in this November and December also, we expect another INR 200 crores from the AP government. So apart from that one, we have certain collections lacking in Telangana, which also now is -- we expect some payment in November and December. But in the rest of the states, the collections are good. Thereby, there is no any big pain on the working capital. In fact, working capital has come down a little compared to the first quarter, in the second quarter, some collections happened. And particularly, some payments also, NHAI payment, which is long pending, that payment we received in the second quarter. And similarly, some payment in the form of claim related to the Hyderabad Growth Corridor, that claim was -- amicable settlement was reached. That payment is also collected. Like that, some old payments also, collection is happening. As a result, at this moment, the liquidity problem or working capital problem or increase in working capital will not be there. But in -- going forward, third quarter and fourth quarter, once the volumes are increased, then the working capital base and other things will come down, certainly. So that is about the AP progress and working capital.

Next question is from the line of Shravan Shah from Dolat Capital.

Sir, just a brief clarification more in the INR 5,000 crore revenue that we are expecting in the second half. Will kind of INR 2,300 crores, INR 2,400 crores kind of revenue can be expected from the third quarter? Or the most of the pickup would be happening in the fourth quarter? And at the same time, now we are doing a much better on the EBITDA margin front, 13.6%, can we expect the same kind of a margin in the second half?

Now we expect about INR 2,200 crores to INR 2,300 crores in the third quarter. And the balance about INR 2,600 crores, INR 2,700 in the fourth quarter. As far as margins are concerned, so there it depends upon the mix of the projects. Generally, we are not foreseeing any sudden drop or sudden increase. It will maintain between 12% to 12.5% EBITDA margins.

Okay. Okay. And on the date front, considering -- simultaneously, if we can -- whatever we are saying that group exposure to reduce from INR 1,400 plus crores to INR 2,000 crores in 2 years. If you can help me by end of this March, what kind of a reduction are we expecting? And how we are looking at a stand-alone date from INR 2,000 crores by end of March?

Yes. First of all about the investments, NCC Urban has got a business plan. They want to repay INR 100 crores every year from the loans that they have taken from the parent company. The current outstanding is about INR 415 crores. So in the -- about 2 months back, they already paid us about INR 45 crores, the balance of INR 55 crores also we are expecting before the end of the current financial year as far as NCC Urban is concerned. And likewise, as we are exiting from the international business, our investments and our loans and advances given to our international subsidiaries are going to come back. And likewise, the NCC Infrastructure at Mauritius, they are also likely to repay some of the loans taken from the parent company because that money was invested in Harmony project, and those monies are going to come back. So management is confident. You may recall, the loans and the advances and the investments in group companies was as high as INR 2,500 crores way back in 2015, '16. But we have monetized BOT assets, we have monetized power assets. And the thought is that the exposure to group companies has come down to a level of INR 1,400 crores now. Now we are focusing on how to monetize the residential investments. One is NCC Urban, which I already explained to you. Other one is we are looking at the Jubilee Check Post project, the landmark project there where we have signed a GPA, and we are getting the developed area of nearly 70,000 square feet with the developer. And on sale of that, maybe 1.5 to 3 years from now, we are likely to get back our investment of nearly INR 100 crores in that project. Likewise, we already exited some -- Tellapur Technocity and got back all the money that we invested. And one more investment we are looking at is the NCC Vizag Urban, where we already got a government GO, agreeing to convert that land into a freehold land, provided some revenue share is paid to them. For determining the revenue share, they formed a committee. Consultants are there, and they have given their report. And sooner or later, all those things will fall in place. And once the government agrees to convert this land into a revenue -- a freehold land, we will be able to sell part of the land and generate revenues at the project level. So all these measures put together are definitely going to help us to bring down the investment and the loans and advances in group companies combined from the current level of INR 1,400 crores to INR 1,000 -- less than INR 1,000 crores in the next 2 years.

Yes. So continuing on that, just a brief idea -- at least for next 6 months by March, can we expect another INR 100 crores, INR 150 crore reduction? And how we are looking at debt levels?

Already some INR 36 crores, INR 40 crores we received from NCC Urban. The plan is to get INR 50 crores to INR 60 crores by March, so that INR 100 crores will be planned for the current year to pay by the NCC Urban. So apart from that one, other, what my colleague explained, other proposals are also there. If it happens before March, some other amount may come. Provided in the year '21, 22, there would be a good inflow on account of the investments and loans from the group companies. For the current year, only up to INR 50 crores, INR 60 crores is the visibility at this moment.

Okay. And debt level, sir?

Debt level, we -- see, we expect that debt level will further come down, and we are not foreseeing any further increase from the debt level. How the -- in the third quarter and fourth quarter, what the consequential impacts because of COVID-19, the state government funds allocation to these projects also is a factor at this moment. And the order book also is another point now. So if there is any good flow of orders and the volume of -- and the volume -- the turnover, it is exceeding 30%, 40% level from the pre-COVID level, then again, some working capital requirement would be there. And again, it depends upon the mix of the projects, which have the facility of mobilization advance. If more mobilization advance facility is there, then naturally the debt will come down. If no mobilization advance facility is there, naturally we have to increase the debt and carry the increased business. But basing on the present operations, internal, these things are done, but we are not foreseeing to increase and some either INR 100 crores or INR 200 crores, INR 300 crores chances are there to bring down the debt from the present level.

Then to add one more point to what my colleague has said, we enjoy cash credit limits. That is working capital limits from the consortium banks totaling to about INR 2,088 crores, whereas the utilization at the end of the second quarter as on 30th September 2020 is only INR 1,557.8 crores. That means there is a headroom of about INR 400 crores or INR 450 crores. If required, we can use it. But we will be very judicious in utilizing these limits. And also, as my colleague has mentioned, in the month of March, most of the time, many government agencies, because their budget allocation is coming to an end, all the outstanding payments, they release. So the payment cycle improves in the month of March, particularly the second part of the March month. That is the annual closing month. And those monies when received, we'll park them in our cash credit accounts once again with the banking system. So there's a good possibility, despite increase in order booking, despite requirement of more working capital, by the end of March, the current debt level of INR 2,000 crores will come down to about INR 1,800 crores or so.

The next question is from the line of [ Vikas ] from [ Natwarlal Stock ].

Congratulations for the results. So sir, my question is related to the order book. What are the verticals from which we are expecting the maximum amount of orders?

Sorry. Shall I answer?

Yes, please go ahead.

Now in this year, we feel that there is a momentum almost in all the segments. So one is Water segment, getting good orders. And Electrical also, they submitted a number of tenders, and they're expecting some good number of orders in their pipeline. And similarly, the Irrigation we received the orders already. And Roads is another one. They are also expecting one order this month. Mining already received a big order in this October, INR 833 crores. So the major orders which are in pipeline are mostly related to the Building division, and some amounts related to other divisions. So more or less, in the way in which earlier we -- our order book composition is there in that composition, orders will come in the -- basing on the orders in pipeline.

Just to add to what my colleague has said, Buildings is a major vertical for us, and about 46% of the order book is in the Buildings vertical, about INR 13,625 crores. We are one of the top builders in the country, at par with L&T and Shapoorji Pallonji, and particularly, building packages of INR 1,000 crores and above, we are able to compete, and relatively, the competition levels are left there, and we are able to bag substantial orders in that particular segment. Likewise, the Roads also contributes nicely for us. But right now, we are focusing on expressways. So Buildings, Water and Roads put together constitute about 75% to 80% of the order book, and in all the 3 verticals, we have a leadership position. It keeps varying. Right now, we've got substantial orders in Water projects. Building projects will continue. Roads also, we are likely to get some more orders. And because of the general economic activity and also the government intention to develop physical infrastructure, substantial order accretion is going to be there for our company because we are one of the front line companies in the construction sector.

The next question is from the line of Prem Khurana from Anand Rathi.

Congratulations on the good set of numbers in this kind of tough environment. Sir, 2 questions from my side. Sir, one was essentially on our AP exercise. I think, in your opening remarks, you said that you've been able to manage some payments come to you almost more than INR 100-odd crores, the payments have been released to you. So just want to understand whether these INR 100-odd crores of payments that we have been able to realize, these were against the old bills which were due? Or this is a new work that you've carried out and you've been released payments against the new bills that you've raised?

This is mostly 90% of the amount relates to the old ones, 1.5 year back.

Okay. And how much of work would we have carried out in Andhra in this quarter? Because -- I mean this is -- why I'm asking this is, eventually, I want to understand how much is our exposure to Andhra. I think at the end of the last quarter, we had almost around INR 1,200-odd crores of money due from Andhra. So has that number come down? Or is it still the same?

Now the work we've done in the Andhra in second quarter is about INR 32 crores. The amount outstanding also earlier INR 1,200 crores is there, now has come down to INR 1,028 crores. Out of [ INR 1,028 crores ] received, come down to INR 991 crores. In the INR 991 crores, about INR 303 crores is the retention money, which is not due at this moment. So that will be paid by the government on a -- with -- as per the terms of the contract. Once we removed the INR 303 crores, which is not currently due, the outstanding is coming down to INR 688 crores. Out of INR 688 crores, INR 494 crores relates to the works in execution, and some INR 194 crores relates to the capital city projects, where the problem is there, where basing on the government policy, they stopped the projects in the capital city, where our money stuck about INR 194 crores.

Sure. And sir, second question was on our arbitration with Sembcorp and TAQA, where are we with both these arbitrations now?

See, Sembcorp arbitration, because of COVID-19, it got delayed, and they got the approval from the high court for the arbitration. The arguments will continue till March 2021. And most likely, by June 2021 or so, the arbitration award is likely to be given by the arbitrators. So we have to wait for some more time for that. As far as the TAQA is concerned, we are discussing for an out-of-court settlement with TAQA officials. The matter is still pending with the Singapore High Court, and we are confident we will be able to close the matter with out-of-court settlement with TAQA. Our discussions are going now.

And we do not see any incremental provisions toward TAQA, rights? Or whatever it...

No, it is not required. Within the provisions that we already made, we are likely to close the deal with TAQA.

Next question is from the line of Ashish Shah from Centrum Broking.

Sir, just 2 questions. One on the -- some of the major projects, could you just brief us on the status of them? So NBCC; Metro Bhawan; the water projects you got in UP, Telangana; the metro projects in Pune, Nagpur; and the AIIMS projects. So if you can just briefly explain that?

Subba Raju sir, can you just cover?

So about the major projects, one of the major project is INR 2,800 crores of Nagpur to Mumbai expressway. That progress -- that project is doing well. Only in rainy season, because of the rains, and also the COVID-19, during that period, some labor problem, some halt has happened, some low progress has happened, but it has picked up. Manpower, whatever manpower, they engaged pre-COVID, in the January month, February month, about 2,500 manpower, they engaged at that time. Now the number reached 2,800. The company, the core team is focusing completely on that one to come to the normal position. They've already come to the normal position. And they want to complete ahead of the time schedule in order to capture the bonus. As a result, the progress is moving well, and they are not seeing any constraints to -- for their progress and plans. So other big projects are AIIMS, about 3 to 4 projects are there. Due to rain and also COVID, some progress is impacted. Now those projects are also gaining back, and in another 1, 2 months, they will come to the normal. So in the Water division, the major projects in the Telangana, no -- major projects are there. All the -- almost projects are completed. They are almost 70%, 80%, some 3, 4 projects are there. And because of these funds payment slowly, they are doing. They got the good number of projects in Odisha in the Water division. There, the payments are good. So there is no any payments pending in that state. Thereby, they are doing well in all the projects. Those projects also, they have come to complete within the time in the water projects. So another big project is there in the -- what is that? In the Karnataka, Karwar, Seabird Karwar. So that in the beginning, because of COVID-19, some slow is there, but now gradually, that project about is now INR 1,400 crores, INR 1,500 crores size project is also picking up now. So airport projects, okay, they are not that much good progress, but moderately, those works are also going. So in Mining, there is a INR 750 crore project. The project is doing well. It is almost 110% ahead of the schedule. So like that, some projects are in momentum. So because the low base of order book in this section. Once the new orders picked up, and then the momentum will come to again the level of '18, '19 like that would be there.

Sir, specifically, Metro Bhawan and NBCC, what is the status there?

Okay. This is Hyderabad. New Delhi project?

Yes. Yes. And this is Nauroji Nagar.

Nauroji Nagar. Yes, that project now has come to the good position now. So in the second quarter, a good amount of turnover, they reported. Now the management is confident to report to -- on the good turnover. Progress is going good. Payments are also now, they released. And we have earlier -- already, we purchased equipment, and the materials are available. Now the manpower is available. So the progress going forward will be good.

Okay. And Metro Bhawan, sir?

Metro Bhawan is...

In Metro Bhawan, there is likely to be a change there. But in Metro Bhawan what has happened is we have already got the mobilization advance from the client, having given the bank guarantees. But work has not commenced, because there's likely to be a change of location. But we are sitting pretty because we are -- the client has already paid the mobilization advance to us. As soon as we finalize about the location, work will start.

Sure. And on the L1 position, can you just tell us what is the total L1 position and the main contracts, main projects in that L1?

We are getting some orders in the pipeline. We have not yet got the letter of intent from the client. So they are L1 positions. About INR 2,000 crores is L1 as on to -- as at this time. They are pertaining to Water division, Buildings division and Electrical division. Beyond that, I cannot give any information. But order accretion is picking up nicely, and strong inflow of orders is going to be there in the remaining months of the current financial year.