Olectra Greentech Limited (OLECTRA.NS) Q1 FY2026 Earnings Call Transcript & Summary

Ladies and gentlemen, good day, and welcome to the Olectra Greentech Limited Q1 FY '26 Earnings Conference Call hosted by Nomura. [Operator Instructions] Please note that this conference is being recorded. I now hand the conference over to Mr. Kapil Singh from Nomura. Thank you, and over to you, sir.

Good evening, ladies and gentlemen. On behalf of Nomura, I welcome you to this call. It is our pleasure to support Mr. Sharat Chandra, CFO Olectra, for this call. Sir, over to you to take this forward.

Yes. Thank you, Kapil. Good evening, and warm welcome to all of you who have joined us today for Olectra Greentech Limited earnings call for the Q1 '25, '26. We are taking a read the presentation, which is put on our website, along with the safe harbor statement thereon. We are pleased to state that the company showed a steady growth in consolidated revenue and profitability for the quarter 1 versus corresponding quarter of last year. We have delivered 2,879 electric vehicles, which includes 2,812 electric buses and 67 electric tippers until 30th of June 2025. Now some of the key highlights I would like to present before we well into the financial performance. Let me summarize them for you at a glance. Olectra buses have successfully covered more than 44 crore kilometers across entire India. This has led to the reduction of approximately diesel consumption of 135.4 million liters, which in turn has reduced the CO2 emissions by about 362.8 million kgs, which is equivalent to planting 16.8 million trees. In terms of deliveries, the whole industry has been having headwinds with regard to supply chain constraints. Despite this, Olectra with cumulative deliveries of 2,812 electric buses has been a leading performer and ranks in the top 2 in terms of total deliveries till date. We are completely focused on the pain points and addressing the challenges and will be striving to reach to #1 position in financial year '25, '26. As you are aware, we have discussed in the past, it is no longer a demand constrained and strong demand continues with the company's net order book of electric vehicles stands at 10,193 numbers as of 30th of June 2025. To recap, we have unveiled our latest technology advancement, the Blade Battery technology at the Bharat Mobility Global Expo 2025. And we are pleased to inform that the homologation process of this bus in advanced stage expected to be completed in this month. And we are planning to commercialize small quantities in quarter 3 onwards with its cutting-edge technology and design and exception energy density, the blade battery promises not only longer ranges, but also the faster charging time, ultimately enhancing the performance, safety and reliability. The performance is expected to be 30% better which is achieved due to lighter weight batteries and 30% lesser than previous batteries. So as we have always -- our philosophy is to continue focus on our increasing our manufacturing capacity and enhancing our technology capabilities. We are constantly exploring new ways to improve, innovate and push boundaries of what is possible in the electric mobility industry setting new benchmarks for the future. Now let me take you through the financial highlights for the quarter 1 on a consolidated basis. Revenue for the quarter 1 stood at INR 347.22 crores, a steady 11% growth over that of last year. This was led by top line growth in both the business segments. In terms of electric vehicle deliveries, we did vehicle deliveries in quarter 1 vis-à-vis 156 in last year. We had an impressive EBITDA of INR 55.97 crores against INR 50.51 crores in the previous year same quarter, marking a steady growth of 11%. The profit before tax surged to INR 33.8 crores this quarter, a 6% increase from previous year's same quarter of INR 31.85 crores. The profit after tax stands at INR 26.03 crores up by 7% compared to the previous fiscal quarter 1 of INR 24.25 crores. And thank you and over to Nomura team for the Q&A.

[Operator Instructions] We have our first question from the line of Rishab [indiscernible], an Individual Investor.

Thank you for the opportunity to give me the question. I have just 3 questions. The first thing was highly applied for the PME drive tender, which is, I think, in the works and you should be opening any time soon. The second question is around the blade battery technology. What's the range we are looking at from a battery range operation perspective? The third question is what's the -- I mean, there are least from a capacity utilization perspective, how many buses from [indiscernible] at as of now post the June quarter? These are the 3 questions.

Yes. Thank you very much. Regarding first question regarding PME drive. The PME drive tender, he is actually getting the extended in terms of utilization by 2 years from 31st March '26 to 31 March, 2028. The total outlay is about 10,900 buses with 9 meters of 2,300 and 12-meter of 8,600, with a subsidiary component of INR 3,585 crores. Olectra is very much in the race. We are going to participate in these tenders.

So isn't there a [indiscernible] tender right now? Isn't that an active tender right now? I mean submissions...

The bid date is September 11, 2025.

Got it, sir.

And the second question is with regard to blade battery. In terms of performance, it is going to increase the mileage by about 30%. So when we talk about we are going to -- as far as Olectra is concerned, we have showcased a few models, 9 meters and 12 meters. So 12 meters, we can expect from a current 300 kilometers range to about 400 kilometers range. With regard to the last question of capacity. See, currently, we are underutilizing our capacity. So we are now striving to basically increase our production capacities in the coming quarters. The second half, we are expecting a significant ramp up. The companies geared up and we are actually in the process of streamlining the production and as we ramp up our operations. The initial guidance what we gave of 2,000 numbers in financial year '26, we are on the right track to achieve this target. And we are seeing a strong -- we started seeing strong traction and ramp-up is happening from quarter 2 followed by -- with acceleration in quarter 3 and quarter 4.

That's helpful. Any numbers you can give us like how many buses.

We'll not be able to -- as of now, I will not be able to give the exact numbers quarter-wise breakup, but overall, our target of 2,000 remains intact as of now for the financial year.

We have our next question from the line of Ashish Khurana from [indiscernible] Capital.

Sir, my first question was regarding the interest outgo. So there is a 30-odd percent decrease there. But I think you would still be drawing from our INR 500 crores sanction. So I just wanted to like this decrease is due to lighter working capital requirements? Or is there any change in terms of any decision to capitalize the interest costs. So why this decrease in Q1.

Okay. Yes. See, basically, the major costs, as you must be aware, our major cost of finance is relating to the letter of credit discounting. So this quarter, our discounting cost has come down in terms of both rate and the quantum. So that is primarily the reason for the lower interest cost. As for the accounting standards, the interest on the term loans before commercial production is getting capitalized.

Got it. Sir, my second question was a bit broader one. So it is not a suggestion, just a question. So I understand that the BYD's platform has radiated advantage stability, safety, some architecture advantage and so on. But 1 argument that could be made was that we should probably reduce our supply chain risk and not only depend on 1 supplier. And in China and other parts of the world, there are various options of different platforms and battery cells. And so our 50 member -- 50 plus number R&D team should maybe not work on trucks and focus on different platforms for e-buses because that is the orders are right now. Now obviously, I mean, our management is very esteemed they would have discussed this internally also this option. So I just wanted to understand, are there reasons to only work with BYD at this point because could be contractual reasons or the technology shift is too big for us to work on under the platform. So any color on that you'd like to give.

Yes. See, basically, I just wanted to clarify. We have a very strong relationship with BYD. Nevertheless, our R&D team has been working on different platforms. And we have been working and testing on various models other than BYD platform. So obviously, we are getup to introduce these technologies as and when the R&D commercialization aspects are completed, we will notify to the stock exchanges in case of any major changes, any new product introduction and all that. So we are definitely diversifying. And as we have mentioned earlier, our localization philosophy is a continuous process. We work on the entire components are localized, except the battery and battery management system. And globally, not only BYD, entire globally, the industry is dependent on China. If there are really serious concerns, it will impact the entire industry, not only Olectra. But we are confident, we are hopeful that there has not been any kind of such situation because we have been discussing this question for the past 5 years. And as of now, both the countries are interdependent on this aspect. I don't think we are going to see any great issues as of now. I hope to clarify with you.

Sir, one small clarification here. So we are working on different platforms, which includes buses, right? So there is no clause that says that you only have to work with BYD buses, right?

Absolutely. There's no such clause. We are working on alternative platforms.

And sir, one more last question on our insulator business. So it has been very profitable this quarter. So I just wanted to check, I mean, is it related to some one-off sustained rate fluctuation thing? And secondly, any impact on tariffs because I think we also supply a fair bit to U.S.A. in terms of our insulator business. So just these 2 questions on the insulator part.

Yes. See, we have been striving to improve the operating margins at the GM level. We have been investing a good amount in R&D design. Design optimization is one of the reasons why we are able to improvise, reduce the wastages, bringing production efficiencies. That is 1 aspect and then larger exports with good margins. So it's a mix of both export and domestic sales. And as far as the U.S. tariff is concerned, it doesn't impact us. So finally, this is an important, very critical raw material as far as transmission lens are concerned, it may impact -- we have actually were with our customer with regard to what is their impact. We have not yet received any response, but insulator being a critical input for transmission line, we are not -- as far as Olectra is concerned, we are not getting any -- we are not -- we are hopeful of not getting any impact on account of the tariff price.

We have our next question from the line of Vijay Pandey from Nuvama Wealth.

I have a couple of questions. One of the let EV sales. So what is the battery prices are looking like? Have you got any benefit in terms of lower battery prices or last 6 months or last quarter as compared to last year? And how do you see the trend going forward?

See, as far as the battery prices are concerned, it is definitely looking down. The prices are coming down, and we are having very good negotiations with our vendors to reduce and take the impact of reduction of prices. So obviously, whatever price is coming down, it's -- we are getting in the sense, our cost of production or cost of manufacturing comes down and we hope the trend continues.

Okay. So sir, do you pass on this price decline to the customers? Or is it like goes directly into the P&L. The reason I'm asking is our margin -- segment margin for electric vehicles has come down is coming down. So -- but battery prices are also coming down given our utilization is increasing. So just want to check how should we look into it?

I think we have clarified in the past, this -- our business model is gross cost contract model, wherein Olectra's responsibility is to manufacture and supply buses as per the tender conditions given by the end customers, which are say transport utilities, the operating arm of the group, the EVEY Trans, they bid for the contract and accordingly, operate for the life cycle of the buses, which is about 10 to 12 years. So our mutual is, when we talk about the margins, I think I have clarified in the past, I would like to clarify again. The operating margins in terms of percentage may come down. But in terms of absolute value, it is going to go up because of the volume which we are targeting. So last year, we did about 972 buses with a margin of about 14-plus percent. But as the volume goes up and as the competition goes up, when we talk about 10,000 numbers, we expect the percentage in terms of operating margin in percentage terms may come down. But overall, in terms of absolute value, it is going to go up. That is the first -- I think I'll clarify on that. As far as the Q1 margins are concerned, since the volume, it all also depends on the product mix. So we have, as explained, again, I would like to clarify, we are present in all the applications. We have cold buses, which is applied for intercity. We have 12 meters, which runs intracity and we have 9 meters which and intracity. So quarter-on-quarter, it depends on the sales mix, which could impact in terms of absolute value of margin.

Okay. Okay. Any reference you were seeing in terms of what is the mix looking like? Like is it intercity, intracity anything particularly you will see from the oversale government side?

No, we have -- Olectra has an order book of about 10,000 plus numbers. We have a mix of inter city. We have a mix of 12-meter and 9 meters all put together. Based on the customer requirements, we schedule our production and accordingly deliver as per the customer requirements.

Okay. Okay. And sir, lastly, I just wanted to check about the insulator sale. So if you can just give some brief about the recent exposures in North America for the market that will be helpful.

Come again, your last bit was not very clear.

The insulator sales, what is the like revenue exposure to North American market and other markets like in domestic exports.

Yes. Last year, we clubbed about INR 180 crores. This year, we are targeting -- we have an order book of about INR 350 crores as we speak. And we have last year done about 30% export, about INR 60 crores of INR 180 crores we did export. So export orders also are increasing, and we are expanding our presence in African countries. Though our major customer is making power systems in U.S. where the geography is North America. So we have actually been working on introducing various products within the insulator segment itself.

We have our next question from the line of Deepak Poddar from Sapphire Capital.

Sir, I just wanted to understand, first, on the I mean our volume and delivery schedule that we are targeting because this first quarter, we did only 161 in units, and we are still targeting 2,000 so that left us with -- I mean, more than 600 per quarter kind of volume, I mean, which to me looks very steep given the target of 2,000 buses that we have. So can you throw some more light that how are we able to achieve that? Or how are we going to achieve this would be very helpful.

I think last quarter itself, we have mentioned about the Q1 numbers is going to be subdued. And we have seen a strong search and traction in quarter 2 onwards. And in terms of ramp-up of production and Q3 and Q4 will be we are going to accelerate. We have actually optimizing our production processes scaling our supply chain in terms of motor execution to execute these numbers. So we are confident as of now that we will be able to meet this target by year-end.

Okay. And so what sort of volume we might be targeting in second quarter given the surge and traction we are expecting in this quarter. I mean we are already months into this quarter, right? So we would have got good sense at what sort of volume.

I would not -- yes, I will not be giving you exact numbers, but give indication, it will be definitely more than double in quarter compared to Q1. So -- and Q3 and Q4 will be our biggest quarter. H2 is what we are targeting to meet the targeted 2,000 numbers.

Okay. So 2Q volume can be more than double as compared to first quarter that we have achieved this quarter.

That is what we are targeting.

Okay. Okay. That's I understand. But -- and in terms of debt side, I wanted to understand, given our expansion to 10,000 buses, what sort of debt level we might need to add, and what is the incremental CapEx that we are targeting in this expansion plan?

As of now, we have a term loan sanction for about INR 500 crores for the new facility. As far as the civil work is concerned, we are expanding our capacity to about 10,000 numbers as civil structure is concerned. And with initial capacity of about 5,000 numbers, expandable or scalable up to 10,000 numbers. This is what is the plan we have currently. And as far as the working capital is concerned, we are having continuous discussions with our customer, which is EVEY Trans to basically reduce the receivable cycle. And we are hopeful that this will happen soon because all the major contracts, when we talk about the 3 major contracts in the country, MSRTC, about 5,150 buses, BEST about 2 contracts, which could be about 2,400 and 2,100. Both these contracts -- all these 3 contracts, financial closures are completed. They are in various stages of documentation. So we are not seeing any major challenges as far as the drawdown is concerned. So as you're aware, this is a capital-intensive industry. And the operating company, EVEY Trans is investing on the CapEx and operating for the entire product cycle. And we have about almost INR 1,500 crores of debt profile. With this, we are hopeful of managing this financial year. As we see the ramp-up in production and ramp up in the volumes, we will definitely try to increase our requirements, we are closely monitoring and tracking that.

And what is the total CapEx involved there in this expansion?

About INR 700 crores is the about total CapEx.

And by when we are expecting it to come on stream?

So basically, it is in advanced stage of construction is in progress. By quarter 4, we'll be fully operational.

By 4Q of FY '26?

Yes, correct.

Okay. And just one last thing on the margin front. We mentioned that operating margins may come down as volumes go up. So what sort of steady-state margins range we might want to look at.

We are looking at around 12% EBITDA margin in terms of overall long term, in terms of volumes and the industry as is progressing because of the competition, because of the volumes. Overall, currently out percentage in terms of percentage is high. But as we see, we may -- it kept stable at around 12%.

We have our next question from the line of Anil, an Individual Investor.

Sharat ji, I want to know like, see, you gave earlier that by March '24 and then subsequently, March '25 and now March '26 that we will achieve capacity of 5,000 buses. So can we expect that this time what you are going to say and confirm is the final one?

Mr. Anil, please understand and appreciate the challenges which the industry is facing. So we are a very conservative company. See, as the volumes based on order production and all that, we have been conservative in investing in our CapEx, okay? So currently, we have capacity to make about 10 buses or [indiscernible], okay? And if there's a need and if the supply chain challenges are not there, we can go up to 20 buses per day. So company has been conservative in conserving the cash. So accordingly, we have not done a full loan also. So we are definitely online, on thought to meet that price of numbers before quarter 4 of this year.

If you remember, like last time I discussed and I asked that whether you are going to utilize the entire fund, which you have already lined up for building up the capacity of 5,000 buses per year. You mentioned to me in absolute terms that the next 6 months, we'll be utilizing it. I understand that the industry is very massive. It's going through a lot of technological changes. We are -- with the company, we are with you. We understand these challenges. The only thing what I'm asking is that, see, if you have placed at plant and machinery for the factory, you are very much sure about the capacity going to be in place. Is that -- you're confirming that plant and merchant what you want is already there, and it will be in place and our capacity by end of this financial year will be 5,000 buses.

Yes, definitely. We have already placed orders. We are working very rigorously with all the vendors. And as far as the drawdown is concerned, we are going to complete in the next 3 to 5 months. And we are definitely hopeful that by quarter 4, our capacity will be 5,000 plus buses.

So what you are saying is that in Q1, we have delivered only 160 buses. in Q2, we are going to deliver 300 more buses. And so rest of the 1,500 buses, let's say, 1,600 buses for the sake of simplicity, 800 buses per quarter, we are set to achieve those targets.

Yes, we are targeting to achieve those kind of numbers provided there should not be any kind of supply chain headwinds.

Okay. And so we can as well say that next year, definitely, for sure, we will achieve 5,000 buses as far our target is concerned, and capacity in place is concerned.

Correct. As far as capacity is concerned, definitely 5,000. As you must be aware, any manufacturing facility do not work up to 100% of its capacity. Generally 85% is what the production capacity, any managing concern can achieve. So we are definitely targeting to meet our orders in the next 24 months.

Okay. There is 1 discussion going on in the market. I don't know whether it is true or not, but just wanted to know your -- from your side being a company representative that Olectra is the promoter is looking to sell this company to pay off his partner's commitment, which he has given INR 15,000 crores?

No, we are not aware of any such kind of things. Nothing of that sort is on [indiscernible].

Okay. All the best to you, and we hope that company will definitely achieve the numbers which you are projecting, and we are with the company.

We have our next question from the line of Aniket Madwani from Step Trade Capital.

Sir, my question is with regard to the recent order book. So sir, as per the news, the order from the MSRTC was canceled, right, an exchange sort of clarification. So sir, what is the status of the 5,150 e-buses from the MSRT?

Yes. 5,250 MSRTC contract is very much under execution. The company is working to complete the targets, what has been discussed and mutually agreed with the customer. So there is no issue with regard to the order as of now. So whatever you have mentioned, it was only a media news. We have not released any formal notices or translation at this particular point in time. And we maintain very, very good communication with them and are committed to fulfilling the contract as planned. The project holds significant important -- significant importance for both the parties.

Okay. Okay. And sir, what will be the PK utilization. Sir, actually, you are contemplating to increase the e-bus capacity from -- so what is the capacity? And second thing is, sir, actually, we want to know about the NTD production for FY '26. What will be the turnaround rate for FY '26.

Yes. As far as capacity utilization is concerned, it is currently at a low level. So we have about almost 2,500 to 3,000 buses capacity, where we have achieved about only 161 buses in Q1. So as we progress, as we ramp up our supply chain and as we ramp up our production, we'll be having better utilization of our capacity. And as far as the numbers are concerned -- numbers are concerned. As a clarity to fellow investors just shortly, we are seeing strong traction and ramp-up is happening from Q2 with further acceleration in Q3 and Q4.

What I'm asking, so it was contemplated to increase the monthly output from 200 buses to 400 buses, right? So at this pace, suppose in July month or June month, how much e-buses that you produce. Actually, I'm asking about only monthly, run rate, not about quarterly?

Yes. Monthly run rate, as of now, we are taking note of your point. We are at present disclosing on a quarterly basis numbers. As well as monthly is concerned, we will deliberate internally. And over a period of time, as we progress, we will take the take note of your point, and we will come back with regard to...

In Q1, you mentioned -- in Q1, you mentioned 161, right?

Correct.

So sir, so you mentioned that 168 for Q1, right? So sir, earlier monthly run rate was mentioned as a 200, right? So if we consider quarterly, it would be somewhere around 600, right? So again, 600, you have achieved only 168. So it seems very low capacity utilization, right, as compared to the commitment.

Yes. I would like to just clarify, we have mentioned 200 numbers will be the capacity what we are going to have per month, okay? That means about 2,500 numbers is what the capacity, production capacity. So our target was this year even in the previous quarter number -- quarter 4 earnings call, we mentioned about 2,000 numbers. Out of which, we have already clarified that Q1 will be subdued. Q4, we did about 290 numbers. In Q1, we have done about 161. And in Q2, we are seeing a strong traction. And Q3 and Q4, there will be acceleration overall, at this juncture, we are sticking to our 2,000 target.

Okay. Okay. 200 number is a target for a monthly -- annual, it would be annual target of 2,000 numbers.

Annual target of 2,000 numbers.

Okay. And sir, what are the key reasons for the shortfall in the committed number. What are the key reasons for this?

So I think I'll have to mention about the industry landscape, the supply chain ecosystem. The overall in terms of numbers, let supplied about INR 2,879 electric vehicles. And compared to entire competition, they have Tata Motors, we have Switch Mobility, PMI, Photon and others. So we are ranking in terms of overall electric buses delivery is still based right from inception in second position. So when we talk about numbers this quarter, we are standing in the forefront. So there are supply constraints, supply unit challenges. There are raw material import issues. There has been earlier battery norms, which was there, like [indiscernible] battery norms, which were introduced, which impacted in terms of getting the deliveries and getting making the product. And there has been war impact also, Ukraine and Russia war impact with regard to getting some raw materials by the -- I'm talking about the industry. So as far as we have been [indiscernible] so the entire industry, this issue is there. So we are now overcoming. We are working very closely with our vendors. We are doing a lot of localization. So we are hopeful that, again, to meet the targets what we have set for ourselves.

Sir, when you say supply chain issue, so it is with regard to the semiconductor and the metric or apart from that, is there any other issue as well?

It is relating to components relating to chassis, components relating to battery.

We have our next question from the line of Bala Murali Krishna from Oman Investment Advisors.

So regarding again upcoming since the last many days or how -- not many months have not got any big orders in between a systems, Himachal project orders. So what is the pipeline and having such an order book which is not executable as of now. I don't think that we can be able to see any orders in the upcoming till next 1, 1.5 years because of everybody want to deliver [indiscernible]. We are not in a position to deliver any buses again after 2 years, even if you won the order. So how do you think that this order book will pan out in the same year and under saying that these issues will be sorted out.

Mr. Bala Murali Krishna, I would like to basically again reiterate in terms of overall the tenders, not many tenders have been floated. And we have -- in the first phase, they are I think, clarified first phase of PME drive, we do not get an order. As of now, the PME drive has come with a revised scheudle. It is about 10,900 buses with subsidy of about almost INR 3,500 crores in terms of value, it is also about 4,000 -- the value is also about almost INR 1,009 crores. So we are definitely participating. We have the extension of the -- because of underutilization. The government has extended in the scheme for other 2 years. The cost that has been not been used. So you have to understand the industry landscape where we are. The ecosystem constraints are there. We are working very closely, monitoring very closely. We are definitely targeting to meet our order book in the next 24 months.

Yes, yes. Yes, good clarification. And regarding the PME drive, so what do you think that how much order we can grab it is the initial stages, we could not be able to get anything. So even if the extended order also, what do you think? How much we can get it from that one.

Yes. Just to reiterate our philosophy we are definitely working on profitable margin, at profitable margins. So the margins are not healthy. We will not look at top line. Our philosophy has been more bottom line driven rather than top line. So if the price is not attractive, we will not bid for it. But we are hopeful in the new tender wherein definitely with Olectra being for a front runner, as well as the front the -- in terms of getting orders or the market share is concerned, we are having about almost 30%, 35%. So we are hopeful of getting good number. We cannot mention any exact quantity. Definitely, we are going to participate.

Good sir. Lastly, on the dilution side when we are submitting now 2,000 buses, so do you see any unforeseen downside risk regarding how because we have not met the guidance in the last 3 years because of a lot of issues, supply chain issues. So as of now, maybe you would have got a better clarity that most of the pipeline finished during this year. So do we see any unforeseen risk there may not be able to meet the target.

As of now, I'm not foreseeing any kind of risk. As of now, we have geared up to meet the targets. So we are striving hard and we are working on the pain area, and we are definitely trying to mitigate whatever issues or risks are there, concerns are there. As of now, we are sticking to our guidance of about 2,000 numbers.

Okay. Any update on [indiscernible]. So have you received any orders or orders from the [indiscernible] and we are in discussion with our parent company, [indiscernible], anything materialized yet?

I think the biggest order in terms of outrate sales we got from HRC, you are aware, 297 buses, so which we are going to deliver the first total in the month of September. And we are hopeful of completing the entire order book by March 2026. As far as our parent company is concerned, we are continuous discussions with the management of our parent company. And recently, we got an order for about 70 electric tippers from them, and we are planning to execute the balance quantity in this quarter.

We have our next question from the line of Nihar Manta, an individual investor.

All my questions have been answered. So thank you so much. I just look at positive with us in the next few quarters.

The next question is from the line of Rakesh Teksanani from RT Associates. As there's no response from this participant, we move on to the next one. The next question is from the line of Mohit Agarwal from Harit Exports.

Okay. Now regarding your production and your numbers, we've been hearing that you'll be ramping up the production in the last 2, 3 years. A couple of years back, you'll had some battery issues the approvals from the government, which came in last whole year also was a wash out. The number did not come in. This year also, you are promising 2,000 busesBut what's the assurance that will happen, orders are in hand, the plant is in hand. The group is rock solid debt-free group. I just don't know what's going wrong and why? Your partners, BYD, they are the best in the world. MEL group is rock solid. It's really sad to see that the performance doesn't come in terms of numbers.

I think Mr. Mohit, appreciate your observation. I think I have clarified very clearly, the industry landscape and the supply chain ecosystem that answers most of the queries. It is not only Olectra, which is not able to deliver, it is entire industry have been facing the supply chain constraints.

But we should be different for the industry. So that is why we are Olectra is why we are EMEA look, we will keep talking about what is happening in the industry and how are we different from some others.

We are in track to as we speak in terms of overall cumulative numbers. We are striving to be #1 in this year. Whatever challenges we have been facing, obviously, Olectra is a part of the entire industry, though we are different in terms of, yes, we are having a strategic partnership with BYD, which is the world's largest EV manufacturer and access to their best technologies. They have a very, very strong parent. So nevertheless, this will not always help. There are supply constraints. So definitely, we have an advantage. We are seeing that the advantage we'll convert into numbers this year. We are keeping our target of 2,000 number definitely this year.

So investing with you guys as a low-brainer, the MEL group, BYD, partnership, orders in hand, plant is up and ready. I don't know why you'll -- it's just too sad.

Mr. Mohit, wish us good luck. Definitely, we are going to complete the target of 2,000 numbers. we definitely required support from investors like you who can push us in terms of motivating and definitely, we are looking forward to meet our numbers this year.

If you want to physically, we'll physically come and push you if required.

Please do come, Please do visit.

Okay, tell me one thing. If you're saying Q2 is going to be better, what were your numbers in July until this August. I'm sure you don't you cannot disclose the exact numbers, but what are the approximate numbers? Have they improved from Q1 or no, approximately.

Definitely showing -- see, basically being a price sensitive. I think they have clarified in the past, we'll not be able to diverse the exact numbers. definitely, we are seeing strong traction. Ramp-up is happening in quarter 2. And definitely, you will see the numbers when we publish the results.

Sure. And any news on the BYD tax card?

Sorry to interrupt, sir, but I may request you to rejoin the question queue for follow-up questions. The next question is from the line of Anil, an individual investor.

Sharat Ji, can you please tell us like this 5,000 buses capacity which we are going to achieve in this financial year-end. Out of that, how much will be for the purpose of blade battery technology versus.

See, we have not bifurcated anything. We are actually planning meticulously to introduce the blade battery technology itself for the existing orders. So we will -- once we start doing the commercial operations, we are -- the homologation process in advanced stage. We expect that to be completed this month. Once that is achieved, we will start the commercial production and sales in quarter 3 itself. So the overall 5,000 numbers includes blade battery.

Yes. But approximate numbers, can you say that like out of 5,000, we'll have a capacity of 2,500 buses based on blade battery technology because that's the future you are saying.

So there is no separate bifurcation because it is going to be assembly instead of the conventional battery is going to be a blade battery and accordingly, the chassis and other components, there could be a different design. So overall, in terms of capacity, it is going to be 5,000 numbers, which will have a mix of the conventional systematic cells to be replaced with blade battery.

So can we say that if required, if needed, like the entire 5,000 capacity can be off grid battery technology-based production?

Yes. Yes. Going forward, we are going to -- we are going to -- our objective is to make it great battery going forward.

Okay. And any update about the -- any update about the new CEO appointment?

So as of now, our -- the Board has taken actively working to appoint a new CEO. As and when it gets crystallized, the same will be notified immediately on the stock exchanges.

So the work is still in progress. Can we say that?

Yes.

Yes, yes, correct. Yes.

The next question is from the line of Gaurav from Utility Unified.

I just wanted to know now that we have an order book of 10,000 electric buses in hand. Just wanted to know how many batteries. BYD batteries have reached the Indian source so that we can get an estimate of like what would be the production level? So how many of those 10,000 batteries have reached Indian source?

Let me clarify, Mr. Gaurav. So basically, it's a continuous process. So based on the production schedule quarter-on-quarter, we have to make the financial arrangement in terms of LCs. Once the LCs are issued, they will manufacture and supply the buses, so it is not that they keep the entire inventory in India. So it's a continuous process where we have monthly quarterly cycle. There's a lead time of about 45 to 60 days.

Okay. I know like how many have been ordered out of those 10,000, so that we get a fair estimate.

So we order on the basis of the production plan for the year. So mutually, we continuously discuss. So we want to basically keep our flexibility because as the prices of the bases are coming on, we will have the flexibility to negotiate and best prices for our company. So it's a continuous process. So if I will not be able to divulge how much buses we have already completed orders. But it's like we can see a good number has been ordered. So we will actually then be -- on a quarterly basis, we review and then take a call.

Okay. Okay. Got it. And just want an update on the MTP Chinese order, like they have released the tender. And I believe Olectra is one of the shortlisted candidate, right?

Yes. See, basically, this is -- we have not won, Olectra has now won this order. It has gone to other competitor.

Okay. And other thing is ...

I may request you to rejoin the question you for follow-up questions. [Operator Instructions] The next question is from the line of Aniket Madhwani from Step Trade Capital.

Sir, can you throw some light on the segment price revenue bifurcation for FY '26, '27.

So when we talk about the overall segment, when we see top line of about 2,000 buses, the insulator segment, we are targeting about -- last year, we did about INR 180 crores. We are targeting more good jump, about 40%, 50% -- 40% is what the -- 35% to 40% is what we have seen a jump in insulator. But looking at the overall number, it will be less than 10%.

Okay. And the other segment, which is insulator.

Yes.

The next question is from the line of Tom Kadavi from [indiscernible] Investment Limited.

Yes. I have two questions. The first one would be, is there a minimum threshold for order book to sales. And my second question would be what is the localization to import mix that we have?

First question, what is the minimum threshold for?

Is there any minimum threshold for order book to sales?

For order book?

Yes.

[indiscernible] about the question at all. because the asset progress, there's no correlation. See, we participate. And once we get the contract, there is an LOE awarded to the operating company based on the LOE and the delivery schedules, the production is planned. Accordingly, we produce and then deliver the buses. So there is no minimal threshold as such. There are timelines provided by the customer. So mutually, as per the agreed time is, we supply the buses. Second, as far as the localization content is concerned, our company is basically complied with all the norms imposed by the regulators as in -- so we comply with all the norms. And I think we have clarified in the past. We are on -- the localization is a continuous process, except the battery and battery management system and some of the components relating to powertrain, which are necessarily to be imported as of now. So other than this, we are developing local vendors, and we are localizing the components.

The next question is from the line of Harsh Saraswat from Elegant Family Office.

So we are fairly new to the company and wanted to understand if you could walk us through the commercial structure of these contracts. The vet use model and how Olectra gets the extra payment? And what is the working capital cycle like that is my only query.

Yes. Just -- as you are new to this company and due to this industry space itself. So this industry is still -- we can see is at a nascent stage. So initially, there were no takers from the lenders with regard to coming forward and lending the projects. Olectra as such, the initial days, I've done a lot of demos across length and breaths of the country. Out of 40 place STUs, we have done the demos, and we have showcased our product. So earlier, there used to be a demand constraint. Now moreover, it is a demand constraint, it is supply constraint, which is there. And as far as the working capital cycle is concerned, it used to be very intensive. More than 6 months working capital used to be there. Now we have been striving to improve the working capital cycle. It has reduced to almost -- when we talk about 31st March, it came down to almost 60 days. On an average, we see the working capital to be anywhere between 3 to 4 months.

Okay. What was...

The payment cycle. As far as the payment cycle is concerned, the operating company, they own the fleet and operate based on kilometers run, assure kilometers given by the contract, the end customer pays per kilometer. The other objective and the advantage is the [indiscernible], when they devised the policy of DCC model, they have introduced escrow mechanism so that the cash flows by the end customers within the STUs whose financials are grade, are secured in escrow account. So almost 2 months escrow amounts are deposited in the escrow account. So generally, our associate company, which is a sister company, which is owning and operating, they also are able to collect the receivables within 60 to 75 days. So as far as we are concerned, the operating companies, they own the fleet by means of a debt equity. So all the major contracts, which the group has won in the recent past, when we talk about MSRTC about 5,150 buses. BEST, the new contract, which is 2,400 extendable to 3,000 numbers. The BEST 2,100 numbers, MSRTC is about almost 450 numbers. All these contracts, the financial closures have been completed. It is in various stages of documentation. So we are seeing the improvement in terms of working capital cycle to come down from earlier 4 months to at least 3 months.

Okay. And in the event of a payment delay or order cancellation by the state authorities, does Olectra bear any exposure to it? Or it is the SPV, which is fully liable for it.

Basically, the SPV is winning the contract. So as of now, we are not seeing many challenges because it is mutually beneficial for both the companies to basically execute and comply with the contract norms because operationally, it is quite economically remunerative for the STUs to switch over to EVs. And our product is in terms of technology, we have proven in performance. Olectra buses have proven, we have done more than 44 crore kilometers across pan-India, and STUs look forward for our product.

Thank you. Ladies and gentlemen, we will take that as our last question. I would now like to hand the conference over to the management for closing comments.

Yes. Thank you so much. We thank all the shareholders who have participated, and I have been very supportive in your company's growth journey and the patience and faith imposed on your company, and we expect good growth in the consolidated revenue and profitability in the coming quarters and in this financial year, which is going to be in terms of number, significant growth compared to early years. Thank you so much.

Thank you. On behalf of Olectra Greentech Limited and Nomura, that concludes this conference. Thank you for joining us, and you may now disconnect your lines. Thank you.