Schneider Electric Infrastructure Limited (SCHNEIDER) Earnings Call Transcript & Summary

Hello, everyone. I'm Pooja Soni from the Anand Rathi team. I welcome you all to the Schneider Electric Infrastructure Q4 Earnings Call. We have on call today Mr. Sanjay Sudhakaran, the Managing Director; Mr. Mayank Holani, the CFO; and Mr. Vineet Jain from the Investor Relations. I thank the management of Schneider Electric Infrastructure Limited for doing this call with us. We shall begin with the opening remarks by the management, post which we will open the floor for Q&A. [Operator Instructions] I want to invite Ashwani from our research team to welcome and introduce the leadership of Schneider Electric Infrastructure Limited for today's call. Over to you, Ashwani.

Yes. Thanks, Pooja. So thank you, everyone. So on behalf of Anand Rathi, we welcome you all for the Q4 FY '21 Conference Call of Schneider Electric Infrastructure Limited. We take this opportunity to welcome the management of Schneider Electric Infrastructure represented by Mr. Sanjay Sudhakaran, Managing Director; Mr. Mayank Holani, Chief Financial Officer; and Mr. Vineet Jain, who is the Head of Investor Relations. We will begin the call with a brief overview of the -- by the management followed by a Q&A session. I'll now hand over the call to Mr. Sanjay Sudhakaran for his opening remarks. Over to you, sir.

Thank you. Thank you, Ashwani. Thank you very much. Good afternoon to all of you. My name is Sanjay Sudhakaran. I'm the Managing Director for Schneider Electric Infrastructure Limited. I recently assumed this position on the 1st of May. Prior to this, I was working with the Schneider Electric Group as Vice President for their Digital Energy business in India. Prior to 2019, all my working career, I worked with an American conglomerate called United Technologies Corporation, which had various group companies such as Carrier air conditioning, Otis Elevators and UTC Fire & Securities. I have served in management positions, P&L positions such as Managing Director for India, Managing Director for India and ASEAN countries, and also as the APAC strategy and M&A leader for Otis Elevators for Asia Pacific region. So that's a brief introduction of myself. I would like to now give you a brief overview of what our markets are looking like and the macroeconomic situation, and what the key business prospects are looking like if we can have the presentation on the screen, please. Would you put it on full screen mode, please? Okay. Thank you. Let's go over to the first slide. Giving you a brief snapshot of the financial and the overall macroeconomic situation in India, I think this is something which all of you are well aware of and well connected to. Of course, we entered this year of 2022 with a lot of hopes coming out from -- on the back of a year that was devastated by the pandemic in 2021. We did see the markets coming back in quarter 1 of this year, but however, the situation remains extremely fragile as we go forward. We are in the midst of a second wave as we are speaking, and which is beginning to ebb a little bit as you can see and read in the newspapers every day. But overall, I think the bullishness with which we walked into 2022 does not seem to be reality. As an organization, we will navigate these markets very carefully, taking into account the safety and well-being of our employees and the business continuity that we need to provide for our customers and also protect the interest of our shareholders. So overall, I think we are entering this year with a little bit of cautious optimism as I would call it. Let's go on to the next slide, please. So I think here are some of those segments of our market, which are -- we are more sensitive to. As we can see that Power and Grid continues to be the segment which we have our maximum dependence on. However, there is action here. There's focus on renewables. There's a lot of privatization initiatives going around here. Digitization to cut losses and improve predictability. And yield is some of the -- is a very important parameter here. So we see investments in digital coming across. And across the board, everyone is focusing on efficiencies. I think we have a very solid proposition here as an organization with -- for end-to-end electric and end-to-end digital as far as the Power and Grid segment is concerned. Mining, Minerals and Metals, another key electro-intensive segment for our organization that I see of importance. Here, again, sustainability and decarbonization is of key importance. We see that CapEx do seem to be restrained in some of the areas. However, there is CapEx happening, and we are working very closely with our key accounts to make sure that we maximize our share of wallet here. Transportation is an interesting segment. I think we are just on the beginning of the curve of infrastructure buildup as far as modern transportation is concerned. So there are a lot of metro projects that are being announced. There are urban transports, mass transport systems that are being announced and also tunnel projects. So I think we are very carefully positioned here. And we, again, see a good opportunity with end-to-end digital and end-to-end electric here. Automotive. We all know the constraints that we face in this segment. So we are not very bullish about this segment, apart from the fact that e-mobility is going to give a boost around here, and we are also preparing to see how we can effectively participate in this sector. This sector is also going to have some ripple effect on Power and Grid as more and more autonomous grids will come up, which will feed into the existing grids because of the fact that we will now require a distributed energy management system rather than a centralized energy management system. Oil and Gas is an area where CapEx will continue to be under pressure. So we are watching the segment very carefully, though electric vehicle charging stations is an area where oil and gas companies seem to be diversifying into. An area which is of good importance to our organization, which traditionally we have not been very strong at is buildings and industry as a medium-voltage offering. We are focusing on this -- these segments as well to provide the necessary leverage that we need in terms of mix, in terms of the fact that our other group companies are very actively involved in the building segment and in the data center segment where we are seeing huge growth. We are plugging in our medium-voltage offers into these segments to ensure that we saturate these segments very well. And just as a preview, I would say that we have reorganized our sales force. We have reorganized our sales force from a geographic, refocused sales force into more of a segment-focused sales force. So all our sales force are now organized by segment, plugging in various architectures and solutions to customers by segment. Let's go on to the next slide, please. Our priorities are well defined as you would have already been reading about our organization and the transformation, which we have been trying to effect. Very simply put, it's more digital, more services and more transaction through partners. All this, making sure that we contribute positively to the environment by being green and digital. We are backed, of course, by segments and customers, key account customers, who very well understand this value proposition. And this transformation is very much in progress, and you will see that this will unlock profitable growth for this organization. So that's our overall strategy, and we stay committed to the strategy. Let's go on to the next slide, please. I'd like to talk about some success stories here. I think skill development is one of the key areas that the Government of India is focusing on. And on the back of this, we have diversified on the services area into trying to build facilities for the Government of India in different areas for enhancing skill development. And here is one of those examples of a skill development center that has been commissioned by our organization for Orissa Skill Development Authority (sic) [ Odisha Skill Development Authority ]. So this is a line of business that we are trying to pursue effectively, and this is bound to give the shareholders a good return on what we are looking forward in our services journey. Let's go on to the next slide, please. Here, again, I'm -- unfortunately, I'm not at the privilege of sharing the name of this customer, but this is a customer in the Power and Grid segment, where -- who is trying to transform their electrical distribution into more digital and more connected products. So we have had a very good win in this segment, and we have executed this project within a record 10 months despite the COVID pandemic, trying to digitize the electrical distribution, and also adding those products into it as pull-through, which are called connected products and which can communicate with the SCADA. So this is an example of how we are trying to transform the segment from a pure product play into a product, services and software play. Just to update you on the COVID situation in India and how we are dealing with the pandemic even through the second wave, I think we have been taking steps to -- in being proactive trying to protect our employees as far as possible, but at the same time, trying to serve our customers. We have taken this very seriously, and on an empathetic platform, we have made sure that we respond to our employees with all the medical support, which is required on ground in terms of a call center for emergency help, bringing in oxygen cylinders to support our employees and their families whenever they are in need, getting oxygen concentrators, importing oxygen concentrators with the help of our group abroad, having an enhanced insurance program and even supporting employees beyond insurance using our Employee Welfare Trust. We are also focusing on well-being. A large number of employee connect sessions are focused on well-being to be able to overcome this trauma of -- which this current pandemic has brought about and trying to make sure that our employees are emotionally balanced in a situation like this. Also focusing on vaccination under the guidelines of Government of India to ensure that our maximum of our field force is -- and factories are inoculated and protected in days to come. So we've embarked on that program as well. So we are making sure that everything goes in the right direction as far as employee safety is concerned, keeping in mind the fact that we will need to serve our customers and support business continuity at the end of the day. So with this, I'd like to hand over to Mayank to talk about the financials of the organization. Mayank, you're there?

Mayank?

Sorry. Sorry. Can you hear me now? Hello?

Yes, we can hear you.

Thanks, Sanjay. Good afternoon, everyone. Hello? Is it okay?

Yes. It's okay now.

Yes. Sanjay was pointing out that the market continues to be challenging, but we are seeing traction in few pockets. And we, at Schneider, continue to be cautious in order booking in terms of giving foremost priority to our margins and security of cash -- of collections. So I'll -- on -- this is the present slide on orders in last quarter and for full year. So we saw a good traction in the order bookings in the last quarter with orders growing by about 13% over last year. While if you look at full year basis, it dropped by about 17%. But you will see that this is a good recovery from the levels of minus 28% for the first 9 months. And where this -- during this year, we have canceled almost INR 120 crores of orders for various reasons, including some of them being from the customer end and a large part from our side because of the RMI, the price validity has expired or a variety of reasons. Can you go to next slide, please? So in terms of execution, we have seen a strong -- I think there was sales -- just go back. Yes, so in terms of execution, we have seen a strong comeback. Q4 sales were 7.7% higher than last year. And for full year, we ended at a minus 6% versus last year. So some recovery from the level of minus 9% YTD December. Next slide, please. So you can see that our results for the year are in line with our strategy. We are -- sorry, can you go back to previous slide? Pooja, previous slide? Yes. So results are in line with our strategy. We have been selective in our conventional orders, which are available in market but have negative impact on margins. So our EBITDA margins have improved by about 3.5 points. And though the PAT is slightly marginally negative, but you will see that over the last many, many years, this is the best performance while this year has been badly impacted by pandemic and further impact of lockdowns also. So exceptionals are related to the employee severance pay, which is as part of our -- the structural part, cost optimization program. Next slide. Here, you will see the Q4 results. Sorry, Pooja, can you go back? Yes. So here also, you'll see the sales have improved by 7.7%, while the profit after tax or the loss after tax is much lower than previous year, though the sales is almost just 7.7% higher. And we continue to improve our performance quarter-on-quarter and hope to see a better one. Next, I think that's it from the finance side. We can move to Q&A.

Pooja, let's open the floor for the Q&A session.

[Operator Instructions] So we have first question from Kunal.

If you can give us some sense of how are we handling the -- what part of our contracts are fixed price? And how are we handling the commodity -- kind of commodity inflation that we have seen in the market recently?

So if -- in -- at an overall level, if I'd say, almost 80% to 85% of our contracts are fixed price. Those, mostly in the government or utility sector, it's that way. Now -- and the remaining are on the variable price basis. Now within that, what we are doing is, obviously, on the past orders, wherever the time lines for the contract delivery or the offer validity have expired, we have proactively gone back to the customers and have asked for price variations. And those, wherever we are not getting, we are canceling the orders, which you have seen in last 2, 3 quarters, there has been a lot of cancellation. Then, also, on the new orders, we have been building sufficient price margin and debt or costing. So that, we are able to deliver, but we are going very relatively strict, well, in terms of the validity of our offers and delivery time lines also. And even we have reduced our price validity. So earlier say, some offer used to be valid for x period, now it's much lower than that so that we can minimize -- and as soon as we get an order or we close a contract, we go ahead and fix the prices with our vendors so that we don't lose out on that commodity price variation.

Mayank, just to add to what Mayank has -- sorry, Kunal, just I'm adding. So when we're talking about the 82% of fixed contracts, we have the EMA clause with the government segments, and that's the reason we have the opportunity to go back and ask for the EMA clause variations. So 82% doesn't mean that -- I mean, say, we can't go for the price increases in -- aligned in the industry.

And sir -- but will we have to -- I mean will EMA cover -- I mean, usually, what we understand is that EMA does not cover the entire cost increase, especially with the kind of cost increase that we have seen. But -- so is it fair to assume that at least 70%, 80% of the cost will be covered through the EMA variation clause?

Yes. Mayank, please.

Yes. Sorry, Vineet, carry on.

So Kunal, this -- you are right. So that 100% cost increase cannot be covered by the EMA clause, but you will get this significant amount of the RMI impact that is coming because of this volatile industry, that is getting covered. Then for the balance of this, we are doing some like -- some hedging, and based upon the order in hand, we are also procuring back-to-back order with our vendors. So we are focusing on other strategy as well as to mitigate the maximum risk that we are getting from this EMA.

And my second question is pertaining to outlook. While we shared some outlook in our opening remarks, if you can throw a slightly detailed outlook in terms of some of the end markets where you are seeing traction -- better traction? And how would you rate the inquiry levels or the traction in -- especially post the second wave? Are we seeing some bit of delays or the order pipeline is better than what it was previously?

So just to add, I think I have -- I hope you can hear me. And I think I have been pretty explicit when I was talking about the segments that there are certain segments which are resilient. Power and Grid and Transportation, for example, are quite resilient. And you see that there is no slowdown as far as the modernization projects or the new infrastructure projects that are happening in that particular segment. Buildings, data centers, et cetera -- hospitals, et cetera, are also pretty resilient. So health care is very resilient, and we are currently focusing on that, and the pipeline is good. Data centers, the pipeline is good. So overall, it's a mixed bag, I would say, with Oil and Gas and MMM slightly dragging it down, whereas a few segments being quite resilient in terms of the outlook. So overall, I would say it's a balanced picture.

The next question is from Mayank.

Yes. Sir, firstly, I wanted to understand now that the Q1 is almost over. So how has the ordering been in Q1, particularly?

So Mayank, just to add here because Q1, it is not yet published. So we cannot comment on the Q1 numbers yet because being on the listed entity, we cannot disclose this information as of now.

So at least, sir, in terms of inquiries, how they have increased Y-o-Y or anything you can give?

That, Sanjay has already answered in the segments, how the segment has been coming up. So inquiries -- and the segment is coming up based upon the inquiries and attraction from the particular segment itself.

Correct. As I mentioned to you, the pipeline is not the concern. The pipeline exists. And it's just the fact that the timing is important. The timing is something which is completely not predictable given the pandemic situation and the localized lockdowns and things that we have had, obviously, will have some lag effect on the finalization. So we are not entirely able to predict how this will go. So I think you can stay tuned for more from us as we kind of end this quarter and come back to you with more specifics as to how Q1 has gone by.

Sir, I just wanted to understand, do we have exports? Or what is the kind of exports we have? And what is the opportunity size there, sir?

See, our exports are not very big, almost our -- major part of our sales is in the domestic market only.

[Operator Instructions] So the next question is from Pankaj.

My question would be for Mr. Sanjay. First thing, I would like to know what is the relation between the listed entity and the company which Schneider has taken over from L&T? Is it owned by listed entity or it is a separate entity?

No. It's not owned by this listed entity.

So when we put on our bids, do we take any consultations with them? Or these companies both operate individually, independently?

They operate individually, and all dealings are at arm's length. So we do not have any kind of interactions on that particular front. The go-to-market is completely independent. Of course, I would not be able to comment on future strategies of the organization. So that's something that I would leave out of the preview of our discussion right now, but we can only say that what's been happening until today.

See, the only relation if you see in both companies is that our ultimate or ultimate parent company is same. Otherwise, there is no direct as such relationship in terms of the holding or something.

So if any products, the likes of ecosphere -- or EcoStruxure if I'm not -- if I'm recollecting rightly, it would be coming to both the listed and unlisted companies in a similar manner, and it will be dealt -- the GTM would be almost similar for both the companies, right?

Yes. For example, if there are softwares which are available with -- EcoStruxure is primarily the software solutions of Schneider. So these software solutions for Schneider necessarily need not reside in any of the legal entity. They can be in a completely different entity or in an overseas entity for that matter. For that matter, all the group companies would have the same equal access to these technologies. Let me put it that way.

Okay. And my second question would be, where does the management see the company in the next 3 to 5 years? Leave aside the pandemic period or the uncertainties related to it. I would like to understand the vision of the management for next 5 -- 3 to 5 years. And secondly, I would request the management to hold these con calls or virtual meets at least once in a year, and if possible, quarterly.

Pankaj, so we are having every quarter on -- these con calls, and this is going on. Along with that, we also have one AGM along with that when we visited from last year as well. And we will have this in the coming months as well. And if I'm talking about the vision of the management, we have communicated in the last 3 to 5 transcripts earlier as well that vision is not something that we are looking for a top line growth. We are looking for the bottom line growth and black numbers in the P&L first. And also our strategies are in a similar line. So once we -- and if you see the results are in the similar lines, and this year, we are almost flat. So the strategy we have explained in the last 3 to 5 quarters is the result you are seeing in the P&L currently. So we will still focus on the bottom line, and focus is to grow more on the profitability part first rather than focus on the P&L. So we will not give more than that or any future statements as per our corporate policy. So we will not give much on the future statements.

Okay. But then would we take 3 years for turning black?

I think, Pankaj, for this, you need to go through the last transcripts, which are available on the website because we have explained everything in detail. So -- and if you have further any question on this, you can connect with me offline.

Pankaj, I'd like to add to what, I think, a little bit of color on the question that you had. See, our end markets are attractive, there is no doubt about it, because primarily, we see electrification as a growing need in India, and there is -- this is an irreversible process. And we also see digitization as a growing need in this -- in our end markets, and there's no turning back on that. Both these factors put together, electrification and digitization, pose very strong opportunities for SEIL, there is no doubt about it. So I think we are poised for certain good exciting end markets. And to add to Vineet's point, what we need to do is we need to participate in this market sensibly with the right GTM, ensuring that we achieve the right levels of profitability. That's the overall guiding principle under which we are going about.

Up next is Danish.

Yes. So I had a couple of questions, and we've been interacting with the previous management as well earlier. So just one thing is that, a, is there any change in the strategy in terms of the distribution of the products? Because I remember earlier, we had a strategy where we'd appoint -- given the debtor issues and receivable issues which we had in the past and the INR 100 crores write-offs, which we had taken, we had then gone ahead and appointed licensees, et cetera, in various parts of the country to deal with customers. So is there any change over there? That's number one. Number two is that there was also a focus on, let's say, maintenance and repair of especially the older transformers and other equipment, which was there as well as some degree of services on the tech and IoT side. So is there a change in the thought process there, more renewed focus, or any color on that would also be helpful? And lastly, actually, if you were to see, I would like to congratulate you, our cash flow from operations has actually improved pretty well for the year. So our auditor keeps on pointing out on the net worth issues. So at some point of time, is there going to be any capital infusion in the company to just remove that net worth issue? Or -- there's obviously no problem with Schneider. I mean I completely agree. But just on the net worth side, if you can share some light, it would be helpful. And no need of numbers, even qualitatively is perfect.

So Danish, I would let Mayank reply to question number -- the last question, and then we will come back on the other question.

Danish, on your -- while Sanjay can -- will speak more on the strategy part, if you see, consistently, our share of transactional, what you said, licensee partner or end services has been increasing, and that has been the case even in this year. So the mix of services and transactional has increased. And that's what is principle in the P&L as well, if you see the gross margin and the overall -- the P&L. It's reflective of that strategy change. And so there is no change in that strategy, and we continue to focus more towards growing more of services, bring more of transactional. On the net worth thing, as you will understand that auditors -- what auditor is pointing is okay from their perspective. But -- this year, we have added to the net worth, right, if you see at least a small amount, but the trend has changed, which has been going in one direction over the last many years. But yes, at this stage, I cannot comment more on the future capital infusion or anything on that sort. And maybe Sanjay can add more on the strategy part.

Just one question, if I may just squeeze in. What is the proportion of transactional and services, if you can share that number?

So Danish, if you look at financial year 2021 versus previous year, our share of transactional and services has improved by about 4%. For -- and this year, it was about 30%, 18% transactional, 12% services. While in previous year, it was about 26%, 15% and 11%.

Understood. Understood, Mayank. And one more question. What is our order book totally today? I mean do you -- in the presentation, I think you have an incremental order. So what would be the closing order book?

Our backlog of orders as on March end is about INR 750 crores. And this is I'm talking of -- INR 750 crores, INR 7,500 million. And this is OG orders, right, outside group orders.

Yes. Got it. And within group, would be another INR 200 crores, INR 300 crores?

Yes. Yes. Within group normally, it's not -- we don't have too many long lead time orders kind of thing. Within group, it's not that way. But in outside group, you have long lead time orders also and rate contract kind of things as well.

Danish, just to add, we are absolutely committed on the strategy. The strategy is very clear. It's more and more digital, digital in everything that we do. What we do with customers, what we do in services, what we do on our products and the way we interact with the rest of the world. This is, for example, this call, right? Someone was mentioning we should have more of these calls. So this is absolutely true in every share that we do, how we transfer documentation from the factory to our end customers, how we track their warranty, how we track failures, how we track the shipment of goods, everything. We're working on an end-to-end digital program. So more and more digital; more and more transaction, which is through partners, licensee partners and core component partners; leveraging the overall Schneider Group backbone, which is very strong on the partner side; and third is more and more services, right? More and more services, which will give a base revenue, which is more and more predictable at higher margins and drop-through.

Got it. Got it. And Sanjay, last question, if I may just squeeze in, then I'll leave it open. Our employee costs, if you remember, last year, we had taken this VRS and severance pay thing. And actually, if you were to see both in absolute terms and in percentage of sales, obviously, it has come down quite meaningfully. And it is good to bring down the fixed cost base. So do you think there is further room for us to improve it? Or do you think this is the level at which we will be at?

So these decisions, I don't think we have a very fixed path on which -- on the -- on this particular thing. I would not be able to predict our future strategy based on this. What we will say is that we have very strong productivity matrices. And what we do is that we either -- as we deliver more and more productivity, we deploy -- redeploy resources into other areas, or if we are unable to redeploy those resources, we will have to take such future calls in the going forward aspect. So it's not something that is completely cast in stone as to which of these methodologies we will use.

Got it. But do you think the benefit of the current VRS is already there in the numbers? Or do you think there is some more which is there of the current VRS scheme?

I think, Danish, the restructuring which happened in last year, we should see part of the impact because it did not happen on the day 1 of last year. So we should see some benefit in '21, '22 as well.

Manish, you may unmute yourself and go ahead, please.

Can you hear us -- hear me?

Yes.

Just a few questions, please bear with me. One is on the exports. Mayank did mention that the numbers are not significant, but like -- I believe it is double-digit revenue share for us. Just if you can clarify what is the exports from India? And also as a follow-up, I believe there are a couple of products which are identified as a sourcing base for the global markets to serve the group. So if you can just give us a perspective, how do we leverage our domestic manufacturing to grow exports? That is number one question. Number two question is on the digital solutions offering what we have been promoting. And we have been seeing improving trends on that. What is the revenue share at the moment coming from the digital solutions both on connected products as well as the solutions what we offer through our EcoStruxure platform? If you can give us a perspective, then I'll follow up with more questions.

So on exports, yes, the number, Manish, is in double digit. You're right. It's in double digit, and it is for sure. On second question...

Can you give us the number? What is the revenue share from the exports?

I don't have it with me readily. Vineet, do you have it?

Manish, I will let you know after the call.

Sure. Sure, Vineet.

So second question you had on the digital, right, Manish?

Yes.

So Manish, on digital, I would just like to add that digital, it's not important to measure the digital revenue per se. It is -- digital is the stickiness between us and our customers because it's a platform business, right? At the end of the day, when you are into a platform business, what it does is that it creates stickiness with customers. It pulls through products. So it's an entire value proposition which is bundled together. So it's not strictly measuring the software sales as a percentage of overall sales. That's not the intention.

So Manish, what happens, say, if I say digital as -- or the EcoStruxure, you can't put, say, 2%, 4% because if your transformer is connected, it's digital, but you can't say to get 2% of the transformer value is digital, right? Because it's the whole transformer, which will get connected or whole switchgear will get connected.

No, I agree. It's only that as a layman, how do we build that perspective that how well we are doing on this digital solution offering? Because the competition on other side is also fairly talking very strongly on the penetration from their side. So just on a competitive perspective also, if you -- just to get a perspective, that was the whole idea.

It will be difficult to put a value on the digital solutions alone, what would be the sales value as such, because it's built into your -- the complete offer. It's not a stand-alone thing, which we can measure.

Okay, sir. So maybe my first question was on outsourcing of products, like have you identified any products which can become -- like Schneider Electric India can become an outsourcing base for the global markets? Are we working on it and want to leverage on the domestic manufacturing facilities?

So we keep on -- we have some exports like even -- especially on -- in last year, some -- there has been increase in especially the transformers. But as such for -- there is no any specific product. There is nothing like, okay, this product becomes -- so India becomes a base for export at this stage. But yes, we continue to evaluate, and last year, if you see, we have increased our transformers export.

Right. And on -- a couple of questions on what would be our gross borrowing today? Because what we see in the published results is the -- without current maturities. So if you can give us what is the borrowing at the current March end?

See, our gross debt, say, around March end is close to INR 540 crores. And that includes the preference shares classified as debt as well, which is about INR 134 crores.

Okay. And also, if you can provide me with the IG revenue contribution in Q4 and FY '21, and also IG order inflow number for Q4 and FY '21?

See, the IG revenue for Q4 was about 28%.

28% or INR 28 crores?

28% in Q4. And the number, if you -- number, you asked for orders, right?

Order inflow, yes, what is the number for order inflow?

Orders in Q4 is about INR 254 million.

INR 254 million?

Yes.

So Mayank, how is it? Because these are ideally a short cycle orders. If you have only INR 25 crores order inflow, how can it be such a large revenue share of 28% in the Q4?

And -- so -- see, when I say large, normally, what happens in, say, outside customer, what he will do, say, if a project is running over 2 years, 3 years, they will have a staggered supply, right? Your supply is mixed, they would like to fix the rates today, and then some supply happening in H1 this year, then H2, then next thing. While in case of IG, you may not have that kind, but the cycle say for product manufacturing is 3 months, 4 months' time line, debt will be there. And it depends on the entity where the OG orders are coming, what is their ordering, right? If they have some orders for which we are manufacturing, we -- our share increases. And as you know, in our kind of thing, it fluctuates. And you'll see in Q4 2020, the IG orders were quite high. It was about INR 798 million or INR 800 million. So it's a cyclic thing, and it depends on the kind of opportunities we have or it's the fluctuation. And last year, we had a couple of -- I think there -- that entity had a couple of big orders from utilities, so which was impacting the number.

Okay. And a couple of more housekeeping. Can you give me order inflow breakup in terms of systems, transactional and services for Q4?

For Q4, our -- the OG orders, 50% have been equipment.

50%?

50%. Yes, 50% equipment, 27% transactional, 11% projects and about 12% services.

Okay. Okay. Fine. I'll come back. Just last question on other income, in Q4, we have seen an increase in other income. Is it because of reversal of the...

So there were mainly 2 things. One was on the -- some of the bad debt recovery, which was earlier provided for, and also some recovery from insurance. So on the Vadodara flooding, which happened in 2019 Q2, so we got the insurance claim for that. So that is also there.

Next question is from Ashwani.

So my question is for Mr. Sanjay. Sir, in your opening remarks, you mentioned opportunities coming from data centers and e-mobility. So my question is that how -- what is the addressable market for us? As a company, we are in a place to capture these opportunities?

When you mean by addressable market, you mean which products, what kind of products?

Data centers. So suppose for 1 megawatt, the costing is around INR 30 crores, INR 40 crores. Of this, what would be our addressable market?

It's very hard to predict that way. It's not very easy to draw a linear line between the data center build and the kind of opportunity that it would present to us. Every opportunity is very different in terms of what kind of revenue pull-through it will generate. Sometimes, with software; sometimes, without software; sometimes, the timing of the projects also decide what kind of buys happen at what particular time. So it's very hard to give you a number as to this is the kind of this thing. But the fact of the matter is that we all know that data centers are power guzzlers. And eventually, data center market is becoming bigger and bigger and more relevant in India. So it will pull through more and more medium-voltage products. So that's the -- and software and services. So that's the hypothesis behind the data center play.

One bookkeeping question. Sir, what would be our CapEx for -- planned CapEx for FY '22?

Sorry, Ashwani, can you repeat?

Sir, what's the CapEx for next year?

There is no major CapEx planned as such.

[Operator Instructions] Yes, Nirav.

Sir, my question was pertaining to the issues which are there because -- pertaining to semiconductors. So a lot of big companies have stated that they are facing issues with regards to procurement of semiconductors and the pricing have been very high. So how do we work about mitigating this problem?

So I think on the semicon side, only a certain fraction of the -- our play has been impacted due to the semicon fluctuations and the supply bottlenecks that have been created worldwide. And as a group, the entire group supply chain is actively involved in mitigating those supplier risks and making sure that business continuity happens at our side on those impacted products. So it's a very small fraction, but an important piece. So the entire group is kind of supporting us on this particular matter.

Right. And sir, my second question will be pertaining to 5G-related CapEx that can happen in India going forward once the spectrum issues are sorted out. How do you look at that opportunity from our perspective?

So on -- Nirav, first of all, I would say that I don't have a complete answer to what you are asking right now. But from what I see at this point in time from a strategic perspective, I think what 5G is going to do is it's going to make connectivity much better. It's going to be able to process much -- data much faster. And the capabilities on the software side and the hardware side will improve based on these particular aspects. And we will have more and more products that are connected and digitally capable of analytics and things like that. So I think overall, it is an enabler to the journey. But I'm not able to clearly see any linkage right now between 5G and how it would impact the current products as such.

So yes, I think at the moment, there are no more questions. So we'll hand over to management for its closing remarks.

So on behalf of Schneider, I would like to thank all of you for participating in this discussion. We will come back to you with more updates. As you can all see that we have a focused strategy, and we have discussed about the pillars of the strategy going forward as well. We are conscious of the fact that the macroeconomic conditions in India are delicate at the moment. And as a management team, we are very, very focused on mitigating all those risks and trying to capture the opportunities as they come to us. And that's all from my side. Mayank, do you want to add something? Or Vineet?

No, Sanjay, I think you have summarized well. And thanks all of you for joining, taking out time and joining this call. And look forward for -- to seeing you for the Q1 call in a couple of months. Thank you.

Yes. So on behalf of Anand Rathi, we thank management. We thank all the participants to come and attend the call. And that concludes today's call. So all can disconnect their lines. Thank you.

Thank you.

Thank you.

Thanks.