Voltamp Energy SAOG ($VOES)

So today, we have the Investor Relationship team with us on a review of updates of 2025. So we'll be in a full year when updates in this meeting. So along with me, my name is Mohammed Ajmal Basha. I am the CEO of Voltamp Energy. And along with me, my team is there Mr. Abdullah Ahmed Al Omar, General Manager of Corporate Affairs with Naveen and finance controller there against [indiscernible] general share services , Arul is there. [indiscernible] Al-Busaidi there with HR [indiscernible] and the person who takes care of administration and [indiscernible] I'll start this presentation to give you a brief update about what has been done in 2025, and we go further. If you see, our revenue has been OMR 72.95 million, which is a growth of 76%. The year, 2025 has been phenomenal for -- can you hear me now?

Yes, we can hear you.

I think there was some glitch there. So were you able to see my presentation or not? Can you see the presentation?

Yes.

Okay. I'll just start back again. I think I don't know.

No, no, it's not visible. You stopped sharing your screen, so share your screen again. Yes. Now, we can see.

So I gave briefly introduction about the team who is present here. In fact, today's Investor Relations meeting is focused 2025 year update. You can see these are the key indicators what we have. 2025 has been phenomenal for us in terms of all the indicators. Our revenue has grown by 76%. We reached a revenue of OMR 72.95 million, which has been historical. Never-ever would hae reached that level of revenue. We reached OMR 72.95 million. The gross profit has again been historical OMR 25.09 million, 18% year-to-year growth, which is 32.39% as per the revenue. When it comes to PAT OMR 14.34 million which is [indiscernible] higher than last year, again, 19.65% of PAT again historic in terms of what has been way for Voltamp, industry in this segment. EBITDA has been [ OMR 19.96 million, ] which is 117% year-to-year growth. Apart from this financial indicators, the order booking, which is a key aspect of the business. When we say order booking, whatever you book the order is what is a reflection of what will happen or what is convenient for you to do for the next year. So we booked an order of OMR 87.67 million. And this is, again, multiple reasons which are there. I'll explain you further on to that. OMR 87.67 million is the total order booking. When you see order booking growth, it's very visible from a level of OMR 46 million -- OMR 29 million to a lag, which has come because of COVID and all, we were able to do a phenomenal job last year where we had opened multiple markets. And we continue to do the same thing. 2024 also we had OMR 87.65 million actually done more than 2024. We had some orders from U.S., which had delayed for the first month. That has been while 2026 first half -- first quarter has been phenomenal again in terms of order booking. So order distribution, if you see domestic is 51% and export is 44% in terms of order booking. 2024 was 58% and 42%, and this has increased in terms of export in 2025, primarily coming from new markets. As far as sales is concerned, you will find that the sales has also been growing in a phenomenal manner. Last year itself was something which was never done in the history and doing more than that is something which has been incredible. We have grown from OMR 41.9 million to OMR 72 million. What we see is a CAGR of almost 18% in last 5 years. When we see sales distribution, domestic is again 59%, export 41%. When it comes to 2024, it is 54% to 46%. As we go forward, this is going to come down in terms of domestic and export is increasing drastically. Raw material cost wise, this is one of a key factor for how we perform because raw material constitute almost 50% to 80% of our total cost. The more you focus on raw material, you have better visibility than that. There are risks. There are certain constraints which are there in terms of raw material, but areas which need to be improved has been focused consistently in the past few years. You can see times were there where 73% to 80% was the norm of raw material cost. We brought it down from 80% to 65% to 58% or 57% in 2025. But what we did differently, which made this happen is a product mix. When we say favorable product mix, what we do is we see what products are giving us better margins, which products are less in the market, which products are in the red ocean. We don't go into that segmentation. So we segment it properly in a way that products are favorably done in a way that we get a better margin. Strategic order execution, we have received strategic orders in terms of U.S. market, in terms of Libya, in terms of Oman also, which are large product markets. So we have chosen those products and those orders and executed those. Apart from the design optimization is a continuous item which we do as a company. We do a lot of work on design optimization, design review, design redevelopment, validation, verification and all. So it's a continuous process what we do at Voltamp. And this is also adding to our bottom line because when we say that we need to improve 2% of design cost in certain designs or something related to a specific material. So we focus on that area. We look for new material, we look for new process, we look for new calculations and then optimize it. So this is one of the major factors improving the raw material cost. Engineering led standardization, again, this is also part of design optimization where instead of having inventories of different materials, sometimes having 10,000 materials is worse than having 1,000 materials, you better look for standardization. Standardization is a process which has been done in our organization for all common metals. This also gives a lot of benefit in terms of inventory and time. Value engineering, again, a lot of materials which are unaccessible are available and all we try to localize try to bring it in different methods and this also adds to the price requirement. Procurement saving, again, is part of our cost leadership, productivity, production efficiency. Efficiency has been a part of our DNA. We have been consistently working on production efficiency, setting the norms, working on what is required base and means. If you remember, last year, we also completed the lean for our distribution transformer, same way we are doing for our transformers. So we look into efficiencies very clearly. Supply base expansion, this also leads a huge risk in terms of supply base as well as flexibility to us. So if you have limited suppliers, they supply generally tend to increase the prices. So when you have alternate suppliers available, generally, there is a competition and we get advantage to that. So these are the key areas which has resulted into raw material cost reduction, and we are working on the same direction so that we are able to optimize, maintain and lower this raw material cost. What are the other direct costs? If you see other direct cost also has considerably reduced, though this is mainly related to economy of scale because the scale has increased tremendously, but it is not just one of them. Although we are growing at a faster pace, we are also monitoring our cost in a very structured manner. You can see it has been coming down in a big manner. So we -- apart from economy of scale, we have planning efficiency. We work on efficiencies. People have the KPIs, they have their targets. They have efficiency monitors. They work on the efficiency monitoring. cost control, better cost control. Again, the manufacturing operation and people, everyone look into how efficiently they can utilize the manpower, the machines and all. We call something like cost of goods manufactured. So when you have this cost of good man, whether you go with old time or we go with, we go with people and all, we do those type of protocols plus consumables and all the stuff. Process improvements are there. We do on a consistent basis. Plant utilization, how we utilize the plant, which machines should run, which not to run. So now we are doing it in a very systematic manner so that it is easy, people planning again. These are the ones which are the resultant of reduction in direct cost. Selling and admission finance cost is also key to the organization, and this is the cost which is reduced from 14% to 11% from '24 to '25, and it has been reducing consistently. Again, we are doing a lot of centralization of services. We are trying to have -- we have our key departments working at a centralized level so that we are able to cater to all the 3 sub-units in a way that they are able to get a better price, better resources, economy of scale again, control headcount growth. We are very clear about growth, what we are going to have for the next 4 or 5 years. Those growth cannot be -- complacency should not come in that growth pattern and that's we are very mindful of what we do so that it doesn't become a burden for us as we go forward. Rationalization of expenses, we do a proper rationalization so that we can focus on it, improved cost governance and improved pricing strategy on freight cost because now when the export increases, the freight cost is something which is very, very big. So managing the freight cost is something which we are doing in a completely different manner. And now with supply chain issues which are globally there, this is something which need to be focused much more. But this is already there in our mind to monitor. So we are working on that. you see this is how the company has been performing for multiple years so that we have a visibility of how it has gone from a gross margin of negligible gross margin to a level of almost 25%. If you see OMR 5.3 million to OMR 3.3 million where we were just breaking even or rather bringing the loss to a level of OMR 25.27 million. If you remember last year when we had this presentation, OMR 13.3 million was also need to be a very big, we are almost double that this year. We are at OMR 25 million gross margin, 18% growth. Same is relevant to PAT. The trend analysis gives you an indication how it has been completely turned around. We have minus OMR 1.3 million loss in 2022 to a turnaround to a big profit to a profit which is exceedingly good, that OMR 14.38 million, which is 1% higher year-to-year. EBITDA same fashion, it has grown in the same manner. If you see what are the contributors and challenges we have in 2025, which has added or delayed us into the process. So if you see positive contributors. Strong performance in power transfer. Power transformer has been a strong performer. Power transfer has given out of the OMR 73 million, it has given almost OMR 49 million. So the major contributor is power transfer. Like power transfer, power transfer has a higher demand globally. And this higher demand has also increased the pricing level to a different extent. The prices there over there. And even with that prices, our prices locally as well as regionally still much better than any other competitors. So that's how we are able to manage -- we have price advantage as well as with this segment doing well. Robust order inflows for GCC and global market. We have done a lot of work in '23, '24, which has opened up new markets like National Grid for Saudi Arabia, Global electricity order for UAE, U.S. market and other markets there. This market started giving us huge orders like today also, we are sitting in a big order book, primarily coming in the mix, which is very, very sustainable. It's not focused into only Oman market or Oman GCC market, it is global market. So this order book is always an indicator for us that you have a sustained business, sustained if you are able to execute it, you are able to win the game. So that's where this has been a key contributor for us to do a proper planning, proper metal planning, proper people planning, proper resources, and this can add to our targets to be achieved easily. Strategic advance in high voltage and transformer as we --- Voltamp has been one of our first goal for renewable energy. We supplied renewable transformers. Oman - first in Oman, first in GCC. That's how we have been developing ourselves. Now we are supplying to renewable transfers in U.S. and UK as well. So that's the way we are starting as well as the advancement of high voltage of 220 kV, 400 kV large reactor. These are the products which are just started giving us the output. This will sustain as well as give more revenues as we go forward. Development of new market. Today, the new market development itself is giving us more than 30% of the market requirement. So that 30% was not there. This 30% has come in just 2 years. So this is something which is reason for the positive contributor. Product efficiency and optimize product mix. This has been our strategy from the beginning. It doesn't make sense that you produce only. We need to produce what gives you money. And this is where we have worked very carefully. And those products, we have worked a lot with the team from top to bottom to see what is the effective and efficient way of manufacturing it, and that has given a lot of benefit to us. Consider and strategic focus on oil and gas. Oil and gas sector has been something which is key to the region, and we have been the front runner for oil and gas sector. We supply key products to Kuwait, Saudi Arabia, Bahrain, Oman, UAE as an oil and gas product, and we have been consistently able to keep our leadership into this area. So these are the key positive contributors, which has been reasons for what we have done last year and what we are going to do in this year also. What are the negative contributors? Ongoing supply chain. Supply chain has been stressed since COVID, we have been seeing a lot of supply chain constraints are there, the price going up and all. Now with -- when it was -- Gaza war was there at the time, Red Sea was having a problem. Now the strait of Hormuz is having a problem. Supply chain constraint is there. This is also making us plan in advance, much advance. But still, this is something which is driving us. Regional instability, this is something which is a new phenomenon, which we are seeing right now, though what happened in Palestine was not what we have seen much here, but what is happening in our region with Iran and the GCC countries is definitely something which we are seeing it very closely and monitoring it because our markets are there, our supply chain routes are there. And overall, people performance is also there based on how it works out to be. Regulatory changes in a certain market like localization requirement, which has been there for many countries. And as we're doing Oman localization, other countries also do localization and plus localization, which is also stopping us to go much bigger. -- competition from Chinese manufacturers, this is there. Chinese manufacturers are coming in Oman very fast. They are leading into GCC also quite quickly. They're also developing plants in Saudi Arabia. So this is one of the competition which is going to come and increase, but we need to mitigate it. Having projects managed to bulk buying. This is something which we have been working for quite some time. We were able to balance some projects. But still there is a long way to go on this subject because Chinese manufacturer, Chinese developers buy as a package coming from China. So this makes us a bit difficult to win the competition price [indiscernible] So we are managing it. We're trying to work on that. So how we are going to manage the risk and how we are going to ensure that we have the -- we are very clear about our business continuity. We drive it very closely as a strategic purpose. We at the leadership level, at the strategic level, we see that business continuity is very important. We have -- our strategy of product and market is giving results. We are monitoring it carefully to see that continue to be with that any items which are disturbance, we take immediate mitigation action. We don't wait for the effect to start coming up. On 20th of February when the norm came in, we were the first to have immediate meeting in our leadership team to see what is the impact of this going forward for our supply chain. And we took decisions immediately, and we worked on to this requirement. Operational resilience and diversification, we made our operations in a way that it is capable of changing needs immediately, and we are doing it on a regular basis. we say that operational resilience, that means that whether it's a small transformer, big transformer, different type of transformer, our production lines, we are making in a way that it is able to adapt. And that adaptability is something which is key to our organization, which is not there in the region with any other manufacturer, any of the competitors. Continued expansion of product portfolio. This is something which will keep us ahead of competition, and that's where we get packed. That's where we can meet the customer requirement. We have plans for this 2026 also to have multi product. Last year, we launched our [ Shunt ] reactor. And this year, Shunt reactor has been the 17th. Oman has been the 17th country in the world to have product of this kind. So that's something which we should all - development. 2026 also, we have planned for -- product. Already, we have signed an agreement with a company in China for doing battery energy storage system. Battery energy storage system is one, which is the new world requirement, renewable -- part of renewable, renewable solar power production was the first part of renewable energy. Now battery storage is the second part. And what we see in Oman as well as GCC as well as in U.K. and U.S., there's a huge demand, and we have already completed our technical collaboration. We are having -- towards that. So we're going to have that. That will come up into '26 and '27. The product segment focus is also there. We look for products which are -- we don't go into competition where we have competitors doing some business and we go into that market, reduce the price and all that is not what we're seeing. We are trying to develop technology within Oman. If you want to develop technology in Oman, we need to bring something which is beyond what anyone can do. This is we have focus. So we have -- products, which we will bring in 2026. -- effort to build sustainable and scalable business model, what I explained in the point #2. Cost to put it to stabilize supplier base. We have a dedicated team and it's working on a continuous basis to see that alternate supply base is there. Today, if we are not able to get it from GCC countries because now if there is a difficulty in getting material from UAE or Bahrain or somewhere. So we have alternate bases. We have bases in India. We have base in China, we have base in U.K. We have bases in Europe, we have bases in U.S. We have bases in Malaysia, Indonesia and all. So we have alternate basis available. So we are able to work to there. And that's -- we are continuously working. So we developed a few suppliers, we're going to develop more. Apart from that, the most important thing is we are very, very clear about developing localization. We have already developed many local suppliers and Voltamp is going to launch a program on localization next month. And you'll find that we are trying to see that components what goes into transformers will be localized here. So we're going to have big sessions workshops and all, calling SMEs, calling industry experts. And we will support them. We will buy from them, and we will help them to develop the localization. So this will also help us as well as Oman when you have integration with the components and all, you will not have this fear of supply chain, which has been there all along. Then people development, this is something which is a continuous process, which we are doing, which will take care of multiple aspects of business. So we have a very clear team. We had HR at a centralized level in 2024, and we have been focusing to see that we retain people. We have good people, we train people. This is something which we are doing on a continuous basis. And these are some of the areas, contributors and challenges and what we have been doing in 2025, which will show results in 2026, '27 going forward. This was 2025 presentation. Anyone has any questions or anything, let me know.

Congratulations on a very good year. I have a few questions. I mean the first one is, of course, on the ongoing disruption in the region. And you addressed part of it from the supply chain perspective. But when it comes to your actual orders, are you seeing any order cancellation or delays because we've spoken in the past about how heavy these power transformers are and some of them can't be shipped through road networks. And with shipping disruptions in play, how are you guys sort of impacted? And what are you going to do to mitigate that impact? And has there been a negative impact on '26 delivery schedule because of this disruption? I guess the first question is around what's going on and how is Voltamp sort of coping with it and what could be the impact?

See, till now, Ananda, we don't have any cancellation of orders. We have a quite good order book. We have orders from -- primarily, if you see the region, we have orders from UAE, we have orders from Saudi Arabia, which are still not showing any inclination to any order cancellation rather the orders are increasing. We had a discussion with the Vice President in --, which is Abu Dhabi. And actually, they are trying to build out more stock, okay? They find that the strategy what they had for a defined plan, they actually expanded their plan. So the orders are not canceling, orders are adding one of the tender which had around $40 million of requirement has changed down to $80 million. So it's almost doubled. So there is no calculation as of now. But what we have seen during this week only, when I was having a discussion with a major utility in USA. USA has flagged saying that we don't want any product coming from GCC. And they are a bit skeptical about that. So we have addressed those requirements also. And we are sure because Oman sitting -- Oman is sitting in a very different position. We feel that we, as an Omani company, we have a lot of advantage which are there, like we were sharing an article to the U.S. company about how Oman is advantageous. We are out of almost - we have 3 ports, which is out of Hormuz. So we are very secure in that manner. And we are regionally very neutral. We are in a different manner. And today, early morning, early morning, I got a WhatsApp message for that we will have one more meeting to decide on this. So this is how things are going. So people are having some fears and how to address it makes a difference, but also people who don't know. People who know are in a totally different manner altogether and this going in a completely fine. When it comes to second question on delivery, specifically to Bahrain, we have a concern with large transformers. But for small transformers, there is no problem. We are able to deliver to every GCC country on road without any difficulty. Even for a small transformer, we are able to deliver transformer to Baharian by King path. Only large transformers, which are very big transformers of 200, 250 tonnes cannot go on [ Kingfastway ] because they cannot go in cause way, they have to go by sea only. We are seeing alternate route where we supply the transformer from [ Sohar ] to [ Jablali ] and from Jablali it goes by sea. Those are also evidence which are seeing. But as of now, our exposure is too low. Our exposure to Bahrain for large power transformer are too low, it is negligible for us. But we are seeing all alternatives which is available.

And what is the margin impact that you're seeing from this crisis? I mean, you've had an exceptional year when it comes to your, obviously, EBITDA gross margins. And with obviously, freight costs going up, can you -- are you in a position to pass on some of these price increases to your end consumers? What kind of contracts have you signed with them? Just for us to appreciate what's going on for the orders that you've already booked?

You see the orders what we have booked, which are outside the GCC region, which goes for sea freight, almost we work through everything. We have more than, you can say, more than 80% of the freights, which are on actual basis with the customer. So it's not getting impacted for us. Specifically on U.S., we have all U.S. orders which rate on actual basis. and even tariff on actual basis because we were having this tariff news going on the whole last year. So all our orders are with a flexible tariff without more risk. We have freight also in that manner. African countries, where we are supplying is on a CIF basis, where freight is into our place. So we are mindful of that, and we are trying to mitigate, work with and take a collective decision so that we don't have that much of an impact. And even Africa, what we have currently, if you remember last year, 2025, first half, we supplied almost OMR 10 million to Libya. So this year, we don't have that mix. So we have less risk here towards any freight cost increase of freight cost impact. But when it comes to inward shipping, we have cost increase. Inward shipping, there is a price increase even coming from India. Coming from any other country. The freight -- the container cost has increased, the freight cost increased. Freight availability has changed. And we're also pushing air freight from Europe because Europe, we get from Germany, Italy and U.K. Those freights, we are getting in by air so that we are able to meet the requirement and not much pick up in freight. Those parts, we are seeing it. So we don't see the profitability impact will be much in terms of that. We have -- what I can say is you cannot see a growth of what you've seen in '24 to '25 to repeat in '25 to '26. But I know we should be able to considerably sustain it as well as improvize.

Actually, that brings me to my next question because when we see the first quarter revenue, there was a drop of almost 14% in the first quarter Y-o-Y. Now I know because we've interacted in the past, you mentioned that there's a chunkiness to these power transformers. They are high-margin sort of products, high-value products. But having said that, when you look at your order book that you've booked over the last couple of years and your sort of backlog entering 2026, are you seeing a flattish year when it comes to revenue and margins? Or first quarter was an anomaly because of maybe some delays in a big power transformer that you couldn't ship? Just for us to appreciate because I think, unfortunately, the market obviously is slaved to the quarterly numbers, right? And that makes us decide the trajectory of a company. While in your case, you don't run a company for a quarter, you run it effectively forever, right? So just how do we reconcile the first quarter slowdown when it comes to revenue, even though your net margins went up? And what is the prognosis for the rest of the year and maybe '27, if you can give us an early peak to '27? If you really ask, we are -- as you rightly said, we don't work for quarter. We don't work for month. We have a very long-term plan. We are very clear. If you really ask, we were planning to do quarter 1 OMR 18 million 9 months back. So we know quarter 1 of 2026 will be OMR 18 million, okay? This is how we plan because your production plan, your metal plan, your order plan is very, very long term. You cannot just chase in 1 month or 1 day. We were not able to deliver product to Bahrain primarily because we're not able to ship it. That's all. But the beauty of the scenario is we were able to still make profitability better than what we did in terms of percentage last year. And we know what percentage of profitability and all we are going to do in terms of what orders we have because that's what I say. When we say order booking, order booking is very key to what we do. So whatever order booking I added order booking in quarter 1 of 2026, I'm going to deliver this in '27, '28. So I know beforehand what I'm going to do. My job is to see that we mitigate any unknown things which comes up and we are able to make a margin which is better. In this scenario also, when supply chain effect, supply start affecting in a way that you have a ban, you have something -- we have some contingencies which are there. So it will the contingency, but it will not hurt us anything in terms of what we plan.

And what about the question regarding -- okay, you mentioned that one Bahrain order you couldn't ship. And you said that, obviously, the revenue growth will not be at the same trajectory that was seen last year. But will there be growth this year based on the order booking that you've had and the capacity expansion that you had over the second half of last year in Sohar? Because the first quarter gave us -- obviously, there was a disruption. And so we weren't too sure. Now you're saying you are expecting a flat quarter, OMR 18 million. So what I'm asking is are you expecting a flat year as well, '26 versus '25 on the top line?

No, we don't see this as a plan. We are very clear what we are going to do. We have budgeted it long back. So we know this is not a flat. We have a growth. What I'm talking about is not a growth story, what we see from '24 to '25. The growth -- there is a growth in revenue as well as profitability, but not to that extent, if the expectation is that we will again have 88%, 130% of growth and all. That's not practically possible and sustainable. And we don't want to do that. If you really ask me, we are very clear that we don't want to do anything which is unsustainable. We will do things which are sustainable, which are doable, which are manageable. So what we see in 2026 is we are going to sustain what we have done and grow as well.

Okay. And in your opening comments, you made a statement saying that the mix -- geographic mix is going to shift from Oman to the export markets. Can you comment on that in terms of what's the sort of mix are you looking at over the next couple of years, which markets? And are these going to be sort of eating into your net margins? Because obviously, I'm just saying that the moment you sort of ship outside, there's this freight cost element that comes in. And I'm not saying this current disruption will last forever. But just for us to appreciate your 2- to 3-year trajectory of how you're seeing the business evolve?

See, Oman transformer market, what we are producing initially used to be OMR 25 million. When we added the high-voltage product, it became OMR 45 million -- if this company has to be a OMR 45 million company, then it's better to stay back in Oman and don't look outside. But we want -- we don't want to have OMR 45 million. We are already OMR 72 million. We are looking to OMR 100 million. We're looking for much more. So what we see here is you need to grow and expand outside. When you grow, expand and go outside, naturally, Oman exposure will reduce. When I say Oman exposure will reduce, it doesn't mean that we leave any order of Oman. I have a very clear commitment with all the utility as well as users in Nama, in PDO, Tokyo everywhere. I will never ever let you down in terms of delivery for you. I will keep capacity for you because that is the whole purpose. We cannot have our focus going outside and not able to cater to Oman requirement. We will get 100% requirement to Oman, but we'll expand as well and increase our capacity. That's what we are doing.

Okay. Okay. And can you give some guidance in terms of what the revenue mix are you seeing shift towards the international markets over the next 2 to 3 years?

Our target is next 2, 3 years, it will be 40%:60%. 40% will be domestic, 60% will be export, maybe plus minus 5%. Most likely domestic will go up to 35% and export will go up to 65% because I see this quarter 1, I have a substantial order, which are export. My market in U.S. currently, which used to be -- if you see, just to give a flavor of it, my first order of U.S. came as a OMR 10 million order in 2023 -- sorry, 2024. I got first order of U.S. of OMR 10 million in 2024. Today, I am sitting at almost USD 95 million order. And I see that this year, whole year, I will be reaching almost $150 million. So we are talking about in 2 years' time, it's growth by 15x. This is something which is phenomenal. And this will obviously change the dynamics.

What's your current order book as -- what is the current order book, the backlog as we speak?

You see what you saw OMR 89 million last year, I think I should be -- I don't want to give the figure of this thing, but I'll say that I'll reach that by May itself.

You'll reach that by May itself.

May itself.

You're saying that's the new order booking. That's what you're talking about now, right?

Yes. Yes. The what I did order booking in 2025. I will complete that order booking by May -- in 5 months itself.

Wow -- and with the idea that these orders will be delivered over the next 12 months, I mean, what I'm trying to ask is what's the book-to-bill basically?

Large orders are for 12 months. I have orders from U.S. for '28, '29 delivery also.

Okay. But you don't want to reduce your current order book.

[indiscernible]

Okay.

I give you a figure, you can calculate it. By May, I should be able to reach what I did last year.

Okay. In terms of new order bookings, -- got it. Okay.

Yes, new orders. orders.

I remember once -- I think I don't know which call it was last call or the call before that, we were talking about Voltamp being a $1 billion revenue company by -- in the next 3 years. Forgive me, I don't get the year right. But is that plan still in -- I mean, is that still the aspiration for Voltamp to be an annual revenue company of $1 billion by, I don't know, 2029 or -- what are you looking at?

We have 100% aim and our commitment is towards going for Voltamp as a $1 billion company. And, even company Omani real company. We are very clear about what we need to do, how we need to do our strategies in place. Initially, our plan was when you were OMR 40 million company. Our target was OMR 100 million by 2030. And that was very skeptical at that point of time. But today, we see that OMR 100 million is nothing, it is achievable. So $1 billion by 2030 or here and there should be possible.

Okay. Can you talk about your expansion plan in Saudi? Has there been any delays there? I think we were talking about a couple of projects, even the GCC Labs project. So just wanted an update on all the expansion plans that you have going on? And when do you expect completion and actual starting the projects?

We see our first -- want to tell something or I'll answer it and then you start. Okay. I'll just complete this one, then --, you can have a question. Joint venture for Saudi Arabia for Transfer, which was there in the last week. Initially, it was a 51% share and then 49%. We were having -- working towards it and we acquired the land, we have a company, we have registered it. We did the civil designing completely. We completed all this aspect. During this time, strategically, we decided that it is better to go as 80% shareholder. I had a meeting with the utility CEO, and he was also very positive towards that. The company has acquired balance percentage and currently, we are 80% shareholder with complete management control with Voltamp and 20%, they are nonoperating partner. And currently, we are financing our construction contractor. This should be finished within this month itself. So we should have -- we see that there is a delay of almost 6 to 9 months because of the things which has happened. We're trying to see that by end of 2026 or early 2027, this should start running. This is for -- For GCC Lab joint venture, we have already established the company. The company name is BG Transport Technical Services. We stand --GCC Lab. And this company is established. It is already -- the Board of Directors have been formed for that. We have acquired the land. We have completed the construction designing and on. Construction should start next month, end of May should start. And this should also see the date by mid of 2027.

I just have a few questions regarding the -- you just said about the GCC joint venture technical service. So how much -- what kind of annual revenue contribution do you see from this company? Can you provide just a brief?

The 2 joint ventures, what we have, the first is a joint venture to manufacture new transformer dedicated to Saudi company requirement. The second joint venture is primarily for repair services for Aramco. So these are 2 different joint ventures with a completely different strategy for the market. One is for ACC, one is for Aramco. One is for new transformer, one is for repair. So you're asking a question about GCC lab, GCC Lab is for a repair transfer. We see that this -- the capacity of this repair transfer is almost 5,000 MVA. When you say 5,000 MVA we are seeing a revenue level of almost SAR 100 million, starting at SAR 100 million to almost SAR 500 million. This is the level of business which this company is going to bring.

Okay. And one more question. And with the new transformer capacity, you have mentioned earlier that this will be fully booked until 2027. So with the Sohar plant has now expanded its capacity, can you give an overview about how we're seeing the demand position and the order book and the capacity utilization levels for the next 3 years?

I was not able to hear you in between, but I think you're talking about Sohar capacity utilization. You see we had an increase in capacity in Sohar from 7,500 MVA to 2,500 MVA. The objective of this expansion were 2 primarily. One is to meet the demand of the customer requirement. The second part was to move from smaller MVA to higher MVA. So what happens is to just give a simple understanding. If you make a 50 MVA transformer, if you have a capacity to manufacture 100, you make 5,000 MVA, okay? Instead of 50 MVA, if you make 100 MVA, say 100 transformer, the capacity is 5,000 MVA. How we see a transformer company at a peer level is 50 MVA give you less value addition or value contribution than 100 MVA. As we go up, the upper we go, we have a better margins and all. That's what we've done in power. We moved from an average of 36 MVA, which was there consistently previous years since I mean to say '22 before to a level of almost 67 MVA today. And our target for 2026 is 100 MVA. So when you have an average MVA, when you say average MVA, you do 500 MVA, 220 MVA, 100 MVA, 30 MVA, 20 MVA and all. But the moment you go up the ladder, your capacities will go in a different manner, utilization will go in a different manner. Currently, 2026, we see our utilization will be around 82% to 83%. And we see that this will go to 82%, 83% to 90%, 95% by next 2, 3 years.

Okay. Just one last question regarding the profit. When I look at the profit for the fourth quarter, it was OMR 4.7 million. And in third quarter, it was -- it has come up from the third quarter, which is OMR 2.7 million. So I just want to understand what was the surge in this profitability? And you have explained in the first quarter of 2026, it has come down because of the Bahrain, right?

Yes. You see it's more to do with the product mix, which was the first reason I said in many cases. Product mix is something which is very, very important as well as the sales what you do because you're absorbing the whole cost with a lower sales or absorbing the cost with the higher sales. So it's a direct line. So if you see Q3, Q4 of last year, the major contributor is your sales. There's a big sales difference between Q3 and Q4 and which we'll see going forward also. But when it comes to profitability, the lower sales, the lower profitability. We see this in Q1 in a different way. We see Q1 of 2025 to 2026 saying that we were able to make a margin of 17% in quarter 1 2025. And quarter 1 2026, we are making 19% margin. The difference in this margin are primarily because there is a lot of improvement which has gone in. If this was -- if I had executed that OMR 18 million, this would have been much more higher because it's value creation on the bottom side because cost is already absorbed. So we see this in that manner. It's your mix of product, it's the total sales what you're doing because there is a breakeven point for the sales what we have with 58%, 59% MSR, you have a breakeven point after that, you're just making the profit.

Thanks for such a very nice and informative session till now. Just adding on to one of the questions which was asked by Abbas. How do you plan to mitigate the inflationary impact of the commodities like increase in price in copper or any other commodities, which are used as a raw material. So are there any mitigation strategies which have been implemented by the company for this?

See, copper contributes almost 25% to 30% of our raw material. That means it impacts almost 18% to 20% of my total price. What we do is we have a very clear copper policy because generally, till now because the market is copper dominated, alumina still not come. So we do copper. So we have a policy where the moment the order comes, we book 100%. We don't do any speculation. We don't look for any gains or losses. We just clearly -- the moment the order comes, I book 100% copper. Whether it goes up or down, has nothing to do with me. My job is to see that I secure my copper. So we do copper, and we have been doing for the last 2 years very, very consistently and managing it and it's working well. The things will come as in terms of other material, we keep a contingency in our cost in coating. We keep a contingency and we -- within that contingency, we work out. This contingency is also created based on multiple analysis, multiple data, multiple reviews where you see what are the things which have benefited previously, what are the cost trends and all. And this contingency takes care of almost, I can say, more than 90% of your risk, which can come because of commodities.

So roughly, copper contributes around 30% to your overall cost. And what is the contribution of the other commodities that you mentioned in the costing aspect?

So what I said is 25% to 30% is the cost of copper is the percentage of copper in my raw material.

What is the contribution of the other commodities in the raw material cost?

It depends on various products like power transformer is a bit different, distribution is different, switchgear is different. But in a general way, if you ask me, copper contributes 25% to 30% of the cost, raw material cost, Electrical steel contribute around 20% to 30% of the cost, 30% when it goes to a high impedance jobs and all. And mild steel, which is tanks and raters cost around 10% to 12% of the cost, oil contributes around 8% to 10% of the cost. Accessories are there. These are the major ones.

I believe Abbas has raised all the questions. [indiscernible]

No, no, I've had my turn. Please go ahead.

So I had a couple of questions. Firstly, regarding the competition that you guys mentioned in the presentation with the Chinese competition coming in, what sort of capacities are they bringing in? And how cost competitive would you be in comparison to those competitors? Is there any risk of any margin erosion due to this factor?

Well you see, our strategy is not to follow Chinese price, okay? -- because Chinese strategy is a little bit different. If you understand it in this way correctly, Chinese manufacturers are coming not as an approved manufacturer and supplying the product to utilities and all. They are coming as a back end for the developers, any renewable projects which are there, any IP projects which are there, they come as a developer arm for the product. Let's say some companies coming as a main EPC for a developer. There is a developer who is a Chinese developer. He has an EPC contractor, which is a Chinese EPC. He has an arrangement with a manufacturer, which is a Chinese manufacturer. All these 3 people combined together come as a package and then they supply. When they come and supply, it's a very hard game in terms of meeting the requirement because they are not looking at one product. They're looking at the solution what they -- and we see that this is a market which is currently at risk for us. So we are not fighting that market in terms of price. We are fighting that market in terms of service localization and all because whenever I have a chance to meet the utilities and all the decision makers, like there was a problem in --, and it was we who has sorted of the problem. We as a local manufacturer. There has been a problem in Aramco. We as the local manufacturers, we supported them. So we, as a local manufacturer, bring much more things as service and support than just a price difference what you have. A power plant, a renewable power plant not able to produce and give power supply for one day is equivalent to 20% of the -- so that type of understanding is very important, and that's what we tell them that don't look for 5%, 10% of the margins, look for the sustainability. And we are able to crack some of those. We are able to get some of those orders. We have been discussing with the major EPC like AKA Power and Mazdan, and they are also very positive towards that. And we hope that's where we go. We will not go behind the price and reduce our price. the Chinese prices will be there.

Perfect. Makes sense. My next question is during the presentation or during one of the questions you mentioned, and correct me if I'm wrong, you mentioned that U.S. is not accepting any products from the GCC region now. Is that what you said?

You see, I said in U.S., we have -- U.S. is much larger. So we need to understand U.S. is like 50 countries, okay? And we have huge order booking during end of last year and this quarter also. We have more than, as I said, $90-plus million of booking with U.S., which has -- which used to be very less in 2024. So when we come across customers, I heard one of my customer who sits in Arizona, he said to me that, GCC is having a war and will you be able to deliver? We are deciding not to have anything from GCC. So my business development sales team has sent one writer about Oman and Oman advantage. And today morning, he sent me that let's have a meeting. what I'm trying to say is regional difficulties are there, regional crisis is there. How you deal with it, how you deliver it and how you communicate is very important. Ananda, we are in Oman, we are sitting at a very safe situation in terms of other countries like specifically UAE, Kuwait and Bahrain. They don't have that situation. We are in a better situation with multiple other routes and all. So I hope they should not be concerned as we see at least at this point of time.

So a couple of questions from my side. First is in terms of guidance, if you can give us guidance what revenue growth and profit growth are you expecting in 2026?

I can say at this point of time that we are not looking for a flat revenue profitability what we had given from '25. We have a growth story. What I can say is don't expect a growth story what has happened from '24 to '25.

Okay. So can we look at 20% growth this year at least?

There are multiple things which are there. I don't want to give a number to you, but there is growth which is going to the -- in both sales. Otherwise, the whole purpose of having such a big order book and all doesn't give clarity. So we have a good order book, but we need to execute it. And if you execute it, you're going to grow and you're going to exceed what you've done. I don't want to tell you if it's 10% or 15%, 20% or 30%. I'm saying that there is a growth, which is there, substantial growth will be there. Quarter-to-quarter, you will see there will be a growth which is coming up.

Sure, sir. On the stock specific side, I mean, if you look at a regional competitor, which is EIC, I mean, both companies have seen phenomenal growth in terms of fundamental, and that has been reflected in the stock prices as well. So when I look at EIC, it trades around 25, 30x earnings. And if you just look at the liquidity in the stock, it -- I mean, the average daily volume is like 0.4% of the market cap -- 0.3% of the market cap. Whereas when I look at hold time, it is quite less, it is just 0.03% of the market cap. So just want to understand from the liquidity point of view, is the management actually looking at what can be done in terms of -- so that it becomes more attractive to institutional investors because a story such as Voltamp obviously deserves to trade at a premium in the market. And if you just compare it with EIC, it is almost half the valuation. So from a stock split point of view or maybe a liquidity provider arrangement, I mean, what is it that the management is looking at?

If you see EIC is operating in Tadawul and Saudi market returns are a bit different. Market cap is a bit different. Fee ratios are different as compared to what we have in Oman. We are -- if you see in Oman market, MSA, you find Voltamp is still -- you're 100% right, if I take any of the markets which are there. What we are doing today, what market capitalization we should get is much higher than what we are today. Having said that, Oman is -- MSX is a market by itself and the liquidity is a concern in terms of availability. Management as well as the Board is working towards how we optimize it, how we do it in a way which is sustainable and long term. And there are actions which are in place. And you will be hearing it something, some decision if it comes out. we are actually short of time. I'll take last question. Kishan Kumar is here.

I wanted to check in terms of what percentage of exports Europe constitutes at presently?

I did not get your question, Kishan.

In terms of exports, we supply to Europe as well, right?

Yes, we supply to Europe.

So in Europe, what is the percentage of revenue that we -- that the current constitution is?

So as I presented, the export market, what we are doing last year, what we did is 43% is what we're looking forward is much higher. It will be strapping towards it. So we should be doing 60% plus as export and 40% down as domestic.

So in terms of order book, you mean Europe does constitute a greater percentage, right?

Yes. The order book even now, we have a good order book, which is export oriented.

Okay. And in terms of margins, how is Europe versus, say, GCC.

You see, I'm not -- for us right now, the way our business strategy is, Europe is not a big provider. If I heard you right, Europe is not what we have -- currently, our order book sales and everything in Europe is less than 5%, okay? Our domestic is almost 20%, 25%. 55%, 45% is in export. In 41% export. Africa has been almost 15% and almost 25% has been GCC countries. And U.S. and Europe together was combined almost 7%. And going forward, we see that Europe will be around 5% only, but U.S. will be around 20%.

Okay. So in terms of, say, exports versus local, like how are the margin differences? Are there any -- I mean, is export any margin accretive?

Yes. If you see margins in U.S. are much better. We had last year executed out of ---. The margins were exceptionally good. In domestic, what we see is domestic, the margins are slightly coming down compared to what it used to be. And that's the reason we are looking to market outside where we can have margins which are better. Again, in domestic also, it depends on what product you are dealing with. We have -- for the distribution transformer, we have 3 local manufacturer available. And for switchgear, we have more than 10 manufacturer available. For power transformer we don't have much, but we have still one manufacturer, which is coming up, doing something on those. So the margins are based on the product what we have. Standard [ Nava ] distribution transformer of 1,000 kV, we may be having 5% margin. Maybe 500 MVA we are having a 12% margin.

Correct. And presently, we are operating at, say, around 80% utilization, right? And you are aspiring to move to 90%, 95% in 1 year time, correct? Did I hear you correctly?

Yes, yes, yes. We expanded last year. So whatever we do, we see that 80% to 83% is our target of utilization. Then next year -- next 2 years, 3 years, we should reach 95% -- 92% to 94% of [indiscernible] Thank you, everyone, for the meeting. I think we had a good session. I hope you had a clear answer from my side. I'm closing the meeting and anyone has any other things, you can reach out to us. We will be able to explain if anything else has to be explained to you.