SPML Infra Limited ($SPMLINFRA)

Ladies and gentlemen, good day, and welcome to SPML Infra Limited Q4 FY '26 Earnings Conference Call. [Operator Instructions] Please note, this event is being recorded. Now I hand the conference over to Ms. Selina Sheikh from Go India Advisors. Thank you, and over to you.

Hello, everyone. A very good afternoon, and welcome to SPML Infra Limited Quarter 4 and FY '26 Earnings Conference Call hosted by Go India Advisors. From the senior management, we have with us on call today, Mr. Manoj Digga, Executive Director and Chief Financial Officer; Mr. [indiscernible], Executive Vice President of Projects, Mr. Samir Patel, Chief of Technology and Operation of BESS segment; and Mr. Arun Agarwal, Vice President, Finance and Accounts. Before we begin the first call, we must remind you that the discussion on today's call may include certain forward-looking statements and must be therefore made in conjunction with the rise of complicated. I would now like to hand over the call to Mr. Manoj Digga for his opening remarks. Thank you, and over to you, sir.

Thanks, Selina, and good afternoon to everybody. I'd like to briefly touch upon the broader industrial environment because the opportunities emerging across infrastructures water, power and energy transition are becoming increasingly aligned with SPML infers core strength and long-term strategy. While the going content in the waste has created genuine headwinds of elevated crude price and supply chain distance. We remain firmly on the view that India infrastructure story is not just impact but has been reinforced by this very geopolitical environment, and we expect the government will continue to remain focus on the sector. This is the company deal suite as all of them are growing need of the country. All our new contract price variation cloud, which covers any risk posed by the war. The financial year '27 has allocated a cost INR 1.2 lakh crore in capital expenditure and multiple agency, including the RBI, S&P Global and the World Bank has projected India's GDP growth between [indiscernible] for financial year '27, reforming that India's growth structure and investment led rather than cyclical. For the domestic infrastructure in a company like ours, driven entirely by government mandated public CapEx, this macro involvement only strengthening our commission going to financial year '27. Within infrastructure, government priorities are increasingly moving towards segments where SPML Infra has deep education experience and established capability. The Union Budget 2026-'27 has allocated INR 67,670 crores to the Jal Jeevan Nissan. And in March 2026, the union cabinet approves its restructuring as Jeevan Nissan 2.0, enhancing the total program outlet to INR 8.69 lakh crores with a central assistance of INR 3.59 lakh crores extended to December 2028, the movement of which has already been started, and we are expecting the disbursement will improve further in the current financial year. Combined with the steady allocation under Amit 2.0 for urban water supply and sewage treatment and the growing state level investment in irrigation and reverse regionization, we believe this creates a strong and sustained pipeline of opportunity for SPML Infra water business in the year ahead. However, we are not finding any issue in any project with respect to Ambritfnded project or project undertaken under funding from bank. We would like to express that the company is very focused on selecting its business on the basis of fund availability, along with other important criteria of profitability, ease of operations and the support of suppliers. Similarly, the power transmission and distribution sector continues to offer strong long-term visibility with the Union budget 2026-'27 allocating INR 1,029 crores to the energy sector, expected to drive significant investment in the substation grid modernization and transmission infrastructure. At the same time, battery energy storage system are rapidly moving from policy intent to large-scale execution over 92 gigawatt of BSS projects are already in the pipeline with 69 new tenders totaling 102 gigawatt floating in the first last year alone, a 35% increase over 2024. Nistar grid scale storage capacity is projected to grow from under 200 megawatts in 2025 to nearly 5 gigawatt by the end 2026. And the Central Electricity Authority estimated India will require over 236 gigawatt of BESS capacity by 2031, '22 with the market expected to grow from approximately I 2 billion in 2026 to 8.6 billion by 2031 at a CAGR of over 33%. Together, these trends provides a strong and sustained runway for growth across both our power, T&D and emerging energy storage business. SPML Infra is not watching this opportunity from the sideline, but already building capacity, investing in scale and activity participating in the transformation. Let me now walk you through our operational update. Our consolidated order book entering Q4 2000 financial year stood at INR 5,369 crores, comprising around INR 4,000 crores of new projects and INR 1,369 crores of legacy orders. The legacy portion predominantly consists of joint control contracts with comparatively lower margins. These are expected to be fully executed over the next 2 to 3 years. With the allotment of new orders, our proportionate shares in the total revenue from the new orders will keep increasing, which will result in higher profit margins on the overall basis. This can be evident from financial year 2027 as the approval of the design and drawing for most of the new project has already been completed, and we are expecting healthy billing of the same in the current financial year. The legacy orders were taken during the time when the company was resolving its debt issue and most of these contracts were given on a back-to-back basis in this there is no execution and cash flow liability of the company. However, the margin is limited but protected. The legacy projects which the company is executing are still delivering decent margin. All the new newly secured orders are meeting the company's selection criteria of higher margin, price protection, no complexity and fully funding, which defines the earnings trajectory we are building towards. We are pleased to report a significant project milestone achievement of the King water supply project in Rajasthan, reflecting our continuing focus on timely execution and operational delivery. SPML secured over INR 4,280 crores included estimates in July in new project orders since financial year 2025. demonstrating the new capacity to execute work, which includes the recently awarded largest order of EFS work is INR 1,128 crores. for which India will provide all the technical head and holding and support. This order momentum is a direct result of SPML 2.0 philosophy, selecting bidding margins, discipline, focus on quality over volume. The company has decided to remain focused on execution, that an building the order book and we remain very selective in choosing orders given the enormous opportunity currently available across all sectors, the company but is expected to commence operational of 2.5 gigawatt BSS and line manufacturing facility at super MIC made by the end of June 2026. The capacity is further planned to be expanded to 5 gigawatt along with the production of 600 containerized ESS unit at the end of this year. This expense is expected to significantly expand when the companies present in the refugee growing BSS segment enhanced revenue visibility and profitability which company is targeting to expand along with in demand of energy storage for resale driven by India is ioverao and the government of India to the initiative coming to the final raising service its bridge to our commit. The company has raised INR 476 crores since May 2024, of which the total promoter contribution is INR 313.5 crores. This is over and above INR 112.5 crores which was contributed during the difficult time. This fundraising has helped the company generating sufficient liquidity. CapEx for the BSS up to 5 gigawatts and the container facility of 6 per year as well as working capital requirement of the project. We are hopeful that with the force fundraising, the company is meeting its requirements and sufficient GDP has been built up to support current operations and projected growth. Coming to our performance. Q4 financial year 2016 witnessed strong growth momentum with revenue rise 53% year-on-year and 27% Q-on-Q to INR 23.9 crores. EBITDA was reported at INR 25 crores with a margin of 8.4% while that increased 10% year-on-year, INR 28 crores. This quarter's EBITDA margin has attracted by a onetime increase in legal and consultancy costs related to our agitation method in noncash regulatory provisions for expected previous loss as to the IndAS requirement and bank limit mobilization costs. The [indiscernible] margins would have been quite healthy, and this been executed broadly in the -- in line with the targeted EBITDA margin of around 10%. We expect healthy EBITDA and prospect margin to continue as the contribution of the new ones increases. Also, the tax revenue during the period is mainly on the tax reversal either out of the recognition of tax benefit argon accumulative income tax losses, which has provided the company with a tax sales. The increase in other income this quarter is primarily attributed to the tieback of term operating hybrid in accordance with the applicable financial accounting standard has been recognized under the other income. However, the sale arises in the normal course of business and is a part of the company's normal operation. For the full year financials year '26, the company delivered a experience performance revenue grew 13% year-on-year, INR 868 crores. We will buy strong execution, healthy productive momentum. EBITDA increased 37% to INR 86 crores with margin of 9.7%, but rose 55% year-on-year to INR 76 crores. A level of -- level that reflects the margin accelerating correctors to our new order mix and the early benefit of our SPML 2.0 of base models. The company made its guideline guidance on other acquisition, profitability, EBITDA and back margin, while the overall turnover has sown shortfall. This was primarily as a result of the company's disciplined approach of calibrating attribution as to fund a ability, which was significant slightly constrained in March due to ongoing East Asia war. It is worth noting that in an EPC business, in terms of our visibility is inherently lead to the order book build over preceding years and the full impact of the recently secured order will reflect in the coming years. On our receivable current rate group has moved up from INR 29.5 crores to INR 417.5 crore, which includes data of this is INR 37 crores, which are back to back contracts for which the single liability are there in the books and some working capital is not blocked. INR 186 crore towards the normal data, which are expected to be realized in a normal cycle of operation and balance represents towards retention and others. The company is suitably managing its working capital requirements with an escrow mechanism, where most of the dates are covered by the creditors and the continued fund is minimally utilized. Accordingly, you can observe that the creditors has increased simultaneously will be paid from the realization against the class from the respective customer. The increase in other current assets is mainly on account of inventories as per the provision of Ind AS, which will be built in the current financial year. The total outstanding balance with [indiscernible] inclusive of interest as on 31st March was INR 380 crores. against the at least INR 700 crores. We would like to inform that this amount includes the prepayment of INR 48 crores against the outstanding dues of 2027, '28 and the company further plans to pay a minimum of INR 45 crores in the current financial year, which will make the 2027, '28 liability almost negligible. The total cumulative cement net to the [indiscernible] in the last 3 years is INR 319 crores against the average tenant million arbitration was received since the MA-regination amount to INR 35 crores. further an arbitration award of approximately INR 627 crores as a 2026 and additional arbitration claim of approximately INR 5 crores to INR 6 crores will be sufficient to repay the entire NARCL [indiscernible]. The company is in a reasonably comfortable reason and needs to change minimum amount from the cash flow for all practical purposes. The company's surplus cash flow are to be utilized only for the growth of the company and not for the fundament to any [indiscernible] dues. From a cash flow standpoint therefore, the company effectively a Pat company as there is a significant sufficient visibility of arbitrator and claim for the impairment of entire NFL views and to see sufficient liquidity for the future growth of the company. With this, our date-to-equity ratio increased to 0.4x tax improved to 4.41% and ROE improved to 8%. With the detibuty of the new business improve liquidity and the focused approach of the management. The lender has enhanced the credit limit of the company up to INR 55 crores. And in considering further enhancement based on the need of the company. which will also arise with the award of the new water in the water, power and , et cetera. Further, the company is also availing the short bond officer, which is their global further leading insurance company place of BT Limited, wherever permissible. The overall 2 bond exposure at very favorable tons at the at a very low margin is INR 305 crores as on date. With the healthy order book visibility of the new business, sufficient liquidity and adiquate bank and Sutimit, the company is quite foul of achieving reasonable growth of more than 25% in financial year '27 at both the top line and margin level and expected this growth momentum to continue in the subsequent years. However, management will continue to review its outlook and provide updated guidance during the annual earnings conference call. I mentioned the 26th March in Saxopoint, INR 568 crores order book, Landmark NTPC, BSM water power and not stories are not verticals, where they are 1 cohenstrategy built for exactly the infrastructure be case India in [indiscernible]. We stepped into financial year '27 with momentum with conviction and with a clear line out side of what the company can become. Tha nk you. Now we are open for the floor [indiscernible] if you have any specific queries, we'll be happy to reply.

[Operator Instructions] The first question comes from the line of [indiscernible] Finance.

Am I audible?

Yes.

Great. Okay. What are the plans for BSS and what value chain are we targeting in BSS?

BSS, basically the BSS is the extended arm of our power EPC business. If you see it's an EPC business where we are completing all the containers. But we have gone with a card integration of relying creation of manufacturing of relining facility and container manufacturing. So these 2 process are going on which is -- which will complete -- one will complete in June and -- June and another will enhance capacity will complete by the end of this year. And then a clip also by end of this year. And we are targeting not only the BSS, we are also targeting the OEM of all the EPCs who takes the BSS business for the [indiscernible].

So what is the demand and supply situation in BSS as so many players are getting into BSS? Do you think there will be an oversupply scenario in BSS going forward?

The demand of BSS, the Government of India is targeting the amount of BSS bond to a we are targeting megawatts basically 86 gigawatts by 2030. So there is a whole demand, 5 gigawatts in the 2026 to 236 gigawatt of BSS capacity by 2030, '31 -- '31, '32 -- that is the government target and the government has started making the mandatory of all the resettable easy, 10% BSS. And the BSS,although there are a lot of players who came into the BSS, we are having certain advantage because I think we are the only company which has a tie up with the nasal in India. We are the only company which are setting up the BASF manufacturing realizing facility that has already been started. And we are the company which has the miles of the power, you see from last 30, 40 years. So we are getting the advantage. BSS whose capacity expansions are going on. not only the renewable now the NTPC, et cetera, has started into the thermal also the BSS. So there is a huge capacity. Although the competition is also there. but we are expecting a full business opportunity going forward in the BSS in next 5 to 10 years.

Sorry to interrupt sir, the current participant has been disconnected. We'll move on to the next question from the line of Kamal Daswani with First Capital.

Just a couple of questions. We had given a guidance of INR 900 crores to INR 1,000 crores of revenue this year. More or less, we were in line with the almost INR 887 crores we reached. If there's a small shortfall, what could be the reason? And what is the outlook for the first half of this year, how much revenue can we expect? That's the first question. Second question on the margins. There's been a slight dip in the margins in this quarter. So what could be the reason for this? And how is the future current year margins looking like...

On the turnover point of view, in the -- on the EPC business, you can consider the EPC company on the basis of the order book because if there is an order book, there is a visibility to complete that order book into the number of years. Like in our case, most of the order books are in 3 years to be executed. There can be some plus or minus into every year, mainly because on the availability of fund. That's where the mature EPC companies play a very important role because with the availability of funds with the customer, we execute that particular month. So in the March, there were some one is the March year-end pressure was there, everybody has completed their quarter, then there is a war movement. So there was some shortfall in the March money availability of few tenders like [indiscernible], et cetera, which we have backed the reason we have reduced our execution to some extent, but you will give the reflect into the first quarter and this year, the entire impact of some sortfall in the last year. And regarding the margin, we are -- as we told you, there is a ligase and the new order, a proportion of the new orders are increasing as soon as that will increase all the new orders, we are taking minimum 10% margin, if not more. So as soon as our execution in the new orders will keep on increasing in the total revenue of that quarter the margin percentage will keep on increasing. So this year -- and if you see this quarter, the margin is mainly impacted because of the onetime. There are certain expenditures on the legal arbitration provision of the Ind AS requirement and the cost of borrowing -- these are the 3 elements which have increased the other expenditure, if you find there is a 10% increase on that, INR 10 crore increase on that. Otherwise, we are -- this year also, our margin level is 10%.

Okay. So by when can we expect the legacy orders to get completely exited and only the fresh high margins business?

If you see the legacy order are those orders, which we have taken in the time when we are -- we were on the process of the data solution. So these orders are mainly back to that. We went to the few contractors. So these are the orders where we don't involve any of our working capital requirements, not only our execution time line, but it will be attributable in 2 to 3 years. But there can't be any loss, no working capital requirement and the margin is small but protective.

Okay. Got it. And regarding the turnover, can we expect in the first half, INR 500-plus crores.

This year, we have -- we are expecting, but top line and bottom line to grow more than 25%. So every quarter, you will find that happening an increase in every quarter accordingly.

Okay. And regarding the -- you had mentioned about the award. So has there been any slowdown in the order floated by the government after they got? Or is it not impacting the order size? I mean...

The sector in which we are in the water, power and assets, and all are mainly to the local government, we are dealing with only the power company, all for the local industries. So we are not finding a lot of tenders are coming, not a the big tenders in MP, Maharashtra, they are in the process. So we are expecting a good number of orders. into this financial year. But as we explained, we are very, very choosy in getting the order. We are on the capability wise, we can take the higher order number of quarters, but we are very, very choosy. We have certain criteria to meet the right area. That is there. But we are expecting a sizable order, not less than last year. We will expect the same type of order in the current financial also.

[Operator Instructions] The next question comes from the line of Aman, an Individual Investor.

can you please part -- we missed the guidance by some few odd crores. We were guiding around INR 1,000 crores of revenue in FY '26, and we are pretty firm on it, I guess. So can you please a little bit elaborate on the part why is the guidance because it basically takes the confidence of the investors. So will it be possible for you to give a decent explanation on that, sir?

For the order book, [indiscernible] to we have whatever we have even, we have achieved on that order book. Second is on the EBITDA and profitability that we have done turnover, we are we were targeting roughly around [indiscernible],000 that has been reduced by play the execution date the money. [indiscernible].

I'm sorry, to interrupt, sir. Sir, your voice is not coming clear. Can you come closer to the mic?

Now is it clear?

Yes, sir, now it is better.

Can you please repeat.

I told you, we have given the guidance on the order book, which we have a on the margin we have exited. On the cover, we remain very helpful on the ability of funds in the hands of the customer. because we don't want to increase our data book very high. So when we lose on the ability, we do the monthly execution. So in the March of the customer. So we have executed accordingly. But that impact, you will find into the current finance area. So that's only the movement of around crores INR 200 crores, which will be added into the current financial year of the last year [indiscernible].

So sir, there will be some spillover in Q1. This is what I can assume?

In Q2, we will find that [indiscernible].

And sir, what will be the peak revenue potential of the 2.5 gigawatt of new assets?

INR 2,500 crores.

INR 2,500 crores. So putting [indiscernible], it would be INR 5,000 crores around, right?

Can be there. As we told and given the guidance into our earlier con call, when we started, we started at 25% power and 75% water and slowly and gradually, our water volume has increased. And we are thinking that by 2029, [indiscernible] of water and power volume will be [indiscernible] so you will find it as any move on the PE and power turnover going forward, along with our water turnover.

So that is in investment sir, what will be the revenue potential for both the phases Yes. Shall it be I mean, INR 5,000 crores?

INR 5,000 crores.

The next question comes from the line of Hardik Gandhi from HPMG Shares & Securities.

Sir, am I audible?

Yes, you're audible.

Sir, I just wanted to know what is the integration part we are doing on BASF. You said there are 2 processes, which we are following there is 1 container manufacturing. And then second one, I couldn't hear you clearly.

BSS is the total EPC, which includes roughly around 35% to 40% is the battery at which we have started manufacturing in our Pune, MIBC Pune super factory, roughly around 8% to 10% is the container cost. That also we have started manufacturing. We are planning to start manufacturing. -- at our Pune.. Rest of the EPC business, we will do.

Right. So you mentioned that the container manufacturing will be completed by end of this year, correct?

Correct.

So as I can see the first 3 years of orders, which you have we've mentioned that it's an 18-month delivery from contracted and then there's a 15-year O&M. If you can help us bifurcate of the total order, what amount is the EPC part and what amount is O&M?

This is basically -- O&M is basically INR 96 crores. Rest is the EPS.

Right. So if I understand correctly, during this year, if -- even if we start in Q1 the pace, then we have roughly 1.75 gigawatt hour for the year if you bifurcate the whole 2.5 gigawatt into 9 months, right? So we should be able to execute roughly 1.75 gigawatt BSS projects during the year. So is that understanding correct? Or is it that even if we have a 5 gigawatt are -- like sorry, 2.5 gigawatts are annual capacity, we will not be able to execute the full capacity in [indiscernible].

This plan -- this order is 1 gigawatt. We have 2.5 gigawatts. So this 1 gigawatt doing well, we can execute from our own factory, which located further in the future, if we get a further EPC business, that also we can do from our own execution as our own plant. And if we get to some OEM business of other EPC player, if they want to take the battery pad that also we can execute from our own factory.

Right. Sir, I understand, [indiscernible] it go -- sorry, what kind of margin comes as an OEM versus an EPC player?

Basically, as I told you, less than 10%, we don't do anything. So that's our new guideline writing here also the same.

Right. So -- but usually, EPC plus OEM, we would attract a better margin. So I just wanted to know the differential like for the projects which we get for ourselves as a EPC player versus the orders which we get as an OEM?

As an EPC player, we were whenever we take any project, there is an OEM -- on the OEMs, you want to say. OEM or you're saying the O&M, annual...

OEM. So we mentioned that there are 2 kind of orders which we can take. For 1 is EPC where we build the battery and then we install it and then we do the O&M. And the second kind of order is where someone else has an EPC contract, but we just provide the battery to them as an OEM manufacturer. Correct?

OEM also around 10%.

Okay. OEM is 10%. But -- so then EPC plus OEM would be like anywhere between 12% to 15%, is that understanding correct or higher than that?

EPC also, we could do 10%. OEM also, we will do a minimum 10%. OEM, the term amount will be passed. If we see the term amount will be slightly longer.

Will we be disclosing OEM orders? Or will it be just on the spot sale basis? How will that work?

Once we start in DFS, there will be a segment accounting. So in the DSA segment, you will find all these things.

The next question comes from the line of [indiscernible].

Hope I'm audible.

You're audible.

Sir, with now the implementation of the new labor code and we're hearing a lot of noise about the ability of labor also becoming a major issue and being an EPC player, how are we derisking ourselves or what are our risk mitigation exercise with the exit of labor? And again, the cost part also Incline to -- yes, attached to it.

On the first part, as we have also mentioned into our accounts that we have decided much before that the labor code implication into our accounts. So we -- our other tenant to the label is based on the new labor court. So we don't have any exact on the cost because of the new labor port system. Number two, on the ability of labor, I don't -- we don't find any problem in getting the labor, getting the contractor or the contractors are getting in the labor. We are not finding much anything on that. It's working well.

So when we look at our revenue of INR 290 crores, can you divide it in percentage terms in terms of the water and the Power segment, the mix between the same, the revenue for the quarter and year as a whole.

[Foreign Language] very limited into power, but I'll let you know. But at the moment, majority you can say, 85% to 90% into the water.

[Foreign Language] And then now with the type of impact crude is creating, how confident are you that [Foreign Language] and players like us [Foreign Language] whether it is [indiscernible] scheme or [Foreign Language], although with the state being funded, so what is our understanding. I think so you have given some only my understanding on the page, which I'm sharing with you.

If you see the water business per se, it is not only the drinking water, [indiscernible] mainly to the drinking water. Then we had irrigation then we have severe, then we have ever intend we have funding from Umbro funding from Namami gene. There are so many government schemes which are going on. Most of the -- various projects are coming with the World Bank funded, various project are funding with the Nava funded, the [indiscernible] there are various items, which we are going. On the ranking water, there tea-ifyou see at this moment like we have taken 3 new or new orders, 1 new order in Kona, which is in the activity that [indiscernible]. Second is indoor, which is the unruled funded. Then third is the [indiscernible], which is the reason new [indiscernible]. So 1 is deliver the payment was stopped because of the certain verification which the government has completed. Now the government are not only releasing the payment, they are enhance the allocation. They have enhanced the period up to September 2028. So the [indiscernible] is also coming back. The backlog of the [indiscernible] is slowly and gradually is coming back to the normal are so much disbursement has happened. Some more we are expecting that is going to come into the [indiscernible] there is no fund issue into the [indiscernible] funded. There is no fund issue into the bank funded, Nabat-funded or World Bank funded. So what is a very big this basket where [indiscernible] is a part and we are, as a water EPC. We are involved in all the activity. all the idea. That's the time where -- when the [indiscernible] was the difficulty, we have not taken any [indiscernible] project. We were focusing more into the Amoanda bank-funded. Now with the [indiscernible] again come back to the normal situation and when the government will further release the fund we may be for some exposure into the selenium. So water the holistic, there are a lot of things which is there into the water. Second, as a practice and as a strategy of our choosing the order, we never take any order which don't have the. So that gives us the additional advantage into the -- any price escalation because that is -- we are getting protected. So our margin remain protected. So unless there is a TV, we don't take that prior. They don't take the order. So these 2 elements covering us and now not only into the water, we are slowly gradually going towards the power also power, there is a whole moment focus into the substation where we are 1 of the leading players. So we are going to that line. and we are also getting to the BES order. So these are the -- all these 3 segments and as I told in our guidance, we are not looking into the very order volume we are not taking -- trying to take the few orders which have the easy to execute and profitable. So the funding aspects we see first PV aspects we see another. And unless we give the clarity on these 2, we don't take the order.

Okay. So sir, PV stands for? I'm missing the...

Price variation.

Price variation, okay. That is the cost explanation growth Okay. Sir, and then about the -- you mentioned about re-linking projects also. So where do we play have our role in those? And I think you're getting at to our project that DPR was given a green signal go ahead. So any traction we are observing on the same enters our focus it can before and PKC, these 2 are the projects which are coming into the NPE. This is our focus projects for this year. Not only [indiscernible] that is also the [indiscernible] there is in the...

[indiscernible].

In the revelinking project, where we will get a lot of orders into this year and next year. And that is our focus. And that is, again, centrally funded. That is, again, the World Bank as [indiscernible] funded. So we are very focused into those type of projects and the ideation project which the government is focusing like the PKC in NPE. These are the projects which are we are focusing along with our non [indiscernible] or drinking water.

For [indiscernible], has the disbursement of the DPR now on ground or still we are working with [indiscernible] but what is the...

They are -- prebidding discussions are going on. They are acting to all the contractors. They have made 2 presentations. They are taking all the feedback of the contractor. And very soon, they will come with a [indiscernible].

[Operator Instructions] The next question comes from the line of Hardik Gandhi with HPMG Shares & Securities.

HJust 1 thing I was observing that of the total order book, a lot of places we are a part of the [indiscernible], right? So just calculating on net-net, what our order book is INR 3,300 crores, right? So I think in the earlier con call, we mentioned that our target is to have a INR 5,000 crore water order book every year. So is that something realistic which we are still targeting and we think we'll be able to achieve?

Not for target. This includes the [indiscernible]. That's our target, what will be the target into BCR also and that we want to do that, roughly around INR 2,500 crores to INR 3,000 crores should be our and...

Net order?

Net order, mostly -- minimum is that. And the INR 5,000 crores is our target order book.

Okay. Because -- so just to clarify, we had INR 5,616 crores order book, of which I think INR 1,300 crores is power order, which is the BSS as well as the substation. Then I removed all the [indiscernible] shares, right? So we ended up with INR 3,300 crores of order. And we are saying that next year, again, we'll have a net-net, like our share of order book will be at least INR 3,000 crores in water segment.

Right.

New orders? Or is it just a closing order book?

No, no. It's -- as given the direction the last year, around INR 5,000 crores, and we -- including of the JV, in which we will have more than INR 2,500 crores to INR 3,000 crores. This year also our targets should be the INR 5,000 core where our orders would be INR 2,500 to 3,000 or more than that, that's our target. Because it's PKC came titan there is some, we will have active role and we have massive interest of doing our own rather than JV.

Great. So -- but if we are looking -- you mentioned all our orders are of 3 years. So typically, next year of the INR 3,300 crores, INR 9,000 crores should be executed. So the outstanding book will be INR 2,300 crores. And then you are saying additional INR 1,000 crores order we'll get next year or more?

It should be more. If it is our target, internal target is roughly around INR 4,000 crores to INR 5,000 crores of orders in these...

Of new order or [indiscernible].

That is the order our execution, our sales would be INR 2,500 crores to INR 3,000.

The next question comes from the line of [indiscernible].

My question was on the CapEx side that for the gigawatt hour that what we are going to start the assembly line by June. What was the total CapEx has been introduced in for -- to extend that 4 to 5 gigawatts do you need same kind of CapEx for...

So roughly around INR 175 over, that is the CapEx, which we are targeting into the 2.5 gigawatt, and first 2.5 gigawatts, we have targeted, 1.25. And there are certain R&D expenditure, which we are planning. So that will own 25 crores and the container facility, we are targeting INR 35 crores. So all tactical runs INR 200 crores is for our BSS [indiscernible] and INR 35 crores is [indiscernible].

Okay. And to extend the store by over, do we leave the same kind of CapEx from there or...

This is inclusive of 5G.

This is inclusive of 5 gigawatts per or capacity. So even that basic different time is relatively less than what we do for water in frac water in a 3.5 for you. And now you have debt, which is -- which may take like 12, 24 months. So I think turnover will be better over here. But how is the receivables look like from this business like side? I mean if you look towards compared to water in and best -- but I mean, do you think that receivables are again have a challenge to get stuck over here?

All the receivables in the water and the base, depending upon the which type of order we have taken, who has funded that, like the NTPC, there is no risk on any receivables. -- they are with 15 to 20 days permit. That is the best. If it is any World Bank funded or that funded again 15 days to 30 days per month. So these are the orders which ship who has -- the funding of the order is very important. And both are applicable to the water and BSS. What BSS target and NBTC, they are the base pay master. So there, the payment will be much more compared to the other government water -- water [indiscernible], et cetera. But all depends upon the project funding. The project funding. The project funding is well, then the cement is not an issue.

Okay. And so in 2030, I think 31 or 32 in this builder that we are planning that the order into business plus deeper business is going to contribute like a 50%, 50% both side. Given that the best we are targeting at 5 megawatts hour per line, which have beia a potential to produce revenue of like INR 5,000 crores. So I mean if that because 50% of that part of your business that at revenue should also come across like INR 5,000 crores. That makes it INR 10,000 crores of revenue. Do you think that this is an aggressive target given that we are sitting somewhere INR 800 crores this year. I mean in the next 5 years, we are seeing that about 12x somewhere.

That depends how we will take the order that if our order capacity, we are targeting INR 5,000 crores every year, then you will find that the multiple of that, like if I'm taking the order now. The next year, I will give 1/3, roughly around 1/3 of that. Next year, when I take another order, I will give in next 2 next year, 1/3 of both. So that's the way the water EPC business will keep on going. And if it is a power EPC, it is 18 months to 2 years, if it is the base, it is 18 months to 2 years. If it is a base OEM, it is a 3 to 6 months. So all that depends that how the mix will be there. And the size, the volume should be increased because we are expecting the sizable growth every year into the EPC business of water and power.

Okay. And in the segment that what we are doing today is we import integrate them into battery pack, put it into the containers, which will be internally manufactured the BMS and some other components that are aligned, it is the full scale of work that we have to do in the NT project is it that I'm a little confused on that?

Yes. Anita, do you want to say anything?

Yes, we are [indiscernible] in our scope. And out of that item that is the main item is we are [indiscernible] the items we are procuring from Indian manufacture is approved and [indiscernible] transform, and other items.

Okay. I think that's all. And one final question, sir, from the revenue side of growth, I mean, again, the same question light I know that you have answered for the last quarter that we are having some shortfall. So you think that in the upcoming quarter that is going to get adjusted to that? I mean I think you have already answered, but I just want to reconfirm once more.

No, the only for your understanding, if we get the order into the EPC, it has to be executed in 3 years -- it can be 30%, 40%, 40. It can be 25%, 37 and 37%, it can be 40-30-30. But it is going to be executed in 3 years into the -- in this thing. So if there is any shortfall in this year, it is going to be back up into the next 2 years. That is definite.

Okay. So -- and you are targeting like 25% growth on the top line and bottom line for the year?

That yes, because all the new orders we got the design and drawing approval. So you will find a substantial growth into that into the current year. So you will find this much -- minimum this much I am expecting.

Okay. And I think for the tax exemption that we are having with the new tax policy, I mean, how many years we are having for that you don't have to pay the tax for that probably. So we'll have an expanded tax?

No, it's a known approved policy and the government guideline and the tax shield we have. If there is accumulated losses, all your profit will get adjusted. And if it is a new regime, then you don't have to pay to the MAT. So we are shifting to the new regime with the government announcement in the last year budget. So we don't have to pay tax under MAT. And at the same time, we have the accumulated loss. So I don't have to pay tax in at least a few years.

[Operator Instructions] The next question comes from the line of Deepak Sharma, an individual investor.

Am I audible?

Yes.

Can you please give me some color on the guidance for the FY '27 and '28 in terms of revenue and the margins on a consolidated basis?

As I told you that 25% -- minimum 25% growth in growth top line and bottom line should happen into this year. And we are expecting more orders. So every yearly guideline, it should happen into a few more years, but the early guideline will give you every annual conference call of the yearly recall. But this year's minimum 25% is both top line and bottom line.

Okay. And also, there can be some forward-looking segments of the working capital days in the coming 2 years?

Working capital days, there are -- once you pay a new project, there are some working capital is required to be indeed, which is there, that is increased more working capital, we are expecting to get released because all projects are getting completed, so the retailer money is going to come. So you will find that the working capital will remain because there are 3 elements into the working capital. If you see on the data side, there is one back-to-back order for these the similar data and similar creditors are there. So that is not impacting us as to whenever the amount come, we will pay to our creditors. There is a retention money similar editors retention also we have. So whenever the retention money will come, we will pay to deribitors. There is a running data into our running projects. We keep on churning into every 1 month, 1.5 months. So that will not be much. we'll keep on getting the money as per due and as per the cycle. So we are not facing any working capital issue. We are -- even in the mobilization advance, we have not taken full because we are not finding any liquidity issue in any of the project.

Okay. And how much is the tax shield at the present in terms of revenue?

Pardon?

How much will be actually [indiscernible] have not to pay tax to the government.

As per the rule, if you have the accumulated cash loss, then that cash loss is going to be adjusted with your future profit. And since we are moving towards the new disease of tax where we don't have to pay the math. So we are having the tax.

I'm asking on the is the [indiscernible] What is the value?

Value, we have a few more years, we don't have to pay tax.

I'm asking in terms of crores, suppose you have a INR 100 crores [indiscernible] INR 200 crores of it how much was [indiscernible].

It is more than INR 500 crores.

The next question comes from the line of [indiscernible]

I just -- in the initial remarks, I missed out on the NARCL here repayment details which I mentioned. If you can just repeat and let us know that what is the exact repayment schedule of [indiscernible] and whether it is linked to the arbitration receipts or how we are going to fund them on this?

[indiscernible] when we signed in 2024, it was INR 700 crores inclusive of that interest. Out of which, we have already paid INR 20 crores and that has already paid and which includes the prepayment of INR 47 crores from the very beginning on all the soft repayment are linked with the arbitration award. We have received roughly around INR 315 crores of arbitration award. We have paid INR 320 crores. Going forward, for the balance amount, we have roughly around INR 630 crores of arbitration award, which is in hand, which has at various advanced stage like some of them are at the Supreme Core -- so whenever that comes, that will go to taste roughly around 75% of that amount will go to the pay to the NAL. So against the INR 60 crores -- INR 630 crores, where the interest is accumulating on every day. we have to pay roughly INR 380 crores to the ACL. So I have sufficient markup. And then I have roughly around INR 4,500 crores of claim that claims, if you see our past track record, roughly around 40% of the claims get converted into award. So I have the visibility, if you do continue with that same trend, roughly around INR 15 crores -- INR 1,500 crores of other award expectation is they are -- so that award, which are going to come and the awards which are in hand are more than sufficient to pay the entire use of NARCL and our future growth fund. For the time being up to 2027, '28 -- '26, '27, we have already prepaid most of the amount in 2025, '26. And this year, we are targeting to start making the cement of 2028, '29 -- '27 -- '28, '29 also. Because all are linked with the arbitration award. We are early realizing the arbitration award, and we are making the comment to the -- so nothing from the cash flow, nothing major from the cash flow barriers -- so almost for all practical purpose, my cash flow is fully free for our growth purpose.

Ladies and gentlemen, that was the last question for today. I now hand the conference over to the management for closing comments.

Thank you very much for tiering. To summarize, financial 6 has been a year of meaningful progress financially, operationally and strategically. We have laid the groundwork strengthen our balance sheet and position the company well for the opportunities ahead. The management remains focused and committed to deliver on its guidance, and we are optimistic about what is what lies ahead for the SPML Infra. Thank you all for the joining us today. Thank you.

Thank you. On behalf of Go India Advisors, that concludes this conference. Thank you for joining us, and you may now disconnect your lines.