Techno Electric & Engineering Company Limited · NSE:TECHNOE
Techno Electric & Engineering — Q3 FY2022 Earnings Presentation
38 slides from Techno Electric & Engineering's earnings presentation, February 2022
Slide 1: An Investor Presentation: Quarter Ended December, 2021
AN INVESTOR PRESENTATION Quarter Ended December, 2021
Slide 2: Corporate Overview, Business Segment Review, Financial Review
» Corporate Overview 03 » Business Segment Review 17 » Financial Review 38
Slide 3: Corporate Overview
NS ay S orate Overview
Slide 4: Powering Value Creation
POWERING VALUE CREATION Techno Electric & Engineering Company Limited (TEECL) is among India’s largest in power-infrastructure companies. It is one of the most attractive proxies of India’s power sector, headquartered in Kolkata. 40+ Years 400+ Projects 25+ Years 400 Professionals of rich experience
Slide 5: Progressing with Confidence
PROGRESSING WITH CONFIDENCE » EPC » Generation » Design to Commissioning » Asset Ownership » Transmission Handover to » Operations and » Distribution Maintenance Maintenance Operation » Industrial Management * TEECL is divesting its renewable energy assets to concentrate more on its core businesses
Slide 6: Key Milestones
PROGRESSING WITH CONFIDENCE - (Contd.) KEY MILESTONES 1980 2009 2010 2021 Launched EPC Entered renewable Initiated transmission Data Centres services energy generation Asset Ownership COMPANY OVERVIEW BUSINESS SEGMENT REVIEW FINANCIAL REVIEW
Slide 7: Advancing with Experience and Expertise: EPC
ADVANCING WITH EXPERIENCE AND EXPERTISE » Transmission & Distribution » Advanced Metering Infrastructure (Smart Metering) » Balance of plant » Captive waste heat recovery and upto 200 MW of conventional power plant on turnkey basis » Flue Gas Desulfurization Plant » Solutions for power-intensive ind
Slide 8: Advancing with Experience and Expertise: Asset Ownership
ADVANCING WITH EXPERIENCE AND EXPERTISE » Build Own Operate and Transfer (BOOT) » Build Own Operate and Maintain (BOOM) » Provide annuity income » Capital intensive » Modest ROE » Stable multi-year income/cash flow » In-house EPC business » O&M revenues COMPANY OVERVIEW BUSINESS SEGMENT REVIEW FINAN
Slide 9: Advancing with Experience and Expertise: Green Power
ADVANCING WITH EXPERIENCE AND EXPERTISE » Capital-intensive » Modest IRR » Multi-year stable income/cash flows » Green Power contributes 10% of total revenues and 34% of total EBIDTA of FY21 COMPANY OVERVIEW BUSINESS SEGMENT REVIEW FINANCIAL REVIEW
Slide 10: Engineering That Is Different
ENGINEERING THAT IS DIFFERENT COMPANY OVERVIEW BUSINESS SEGMENT REVIEW FINANCIAL REVIEW
Slide 11: Once a Customer, Always a Customer
ONCE A CUSTOMER, ALWAYS A CUSTOMER TEECL primarily serves CPSUs, state-run utilities The Company follows the operating philosophy of and private sector customers (captive power plant and power distribution system for power intensive industries). Over the years, it » Helped build 50% of India’s natio
Slide 12: Growing Recognition
GROWING RECOGNITION Certificate of appreciation from Best player in 765 KV AIS IEI Industry Excellence Meritorious Performance in JBVNL for 100% electrification in Substation Construction in Award, 2016 Power Sector in 2011-12 by Dhanbad in 2018 India in 2018’ by PGCIL Ministry of Power Awarded Cert
Slide 13: Capable Leadership
CAPABLE LEADERSHIP Qualification » Postgraduate in Management (IIM, Ahmedabad) » Honours graduate in Industrial Engineering Experience » Merchant banker with National Grindlays Bank » Management consultant deputed to BHEL Association with TEECL » Grew TEECL into prominent Indian EPC company in power
Slide 14: Leveraging Opportunities
LEVERAGING OPPORTUNITIES » As per, Gazette notification (GOI) all Thermal Power Plants need to limit » Total target is of 175 GW of renewal » India has around 375 MW of Data Centre in H12020, their sulphur emission. energy capacity. » Total Target is for 123 GW by 2024 » Out of the above, bids for 5
Slide 15: Utilising Corporate Strength
UTILISING CORPORATE STRENGTH Consistent Ability to embrace Efficient working Rich terrain upgradation to challenges capital management understanding industry-next technology On-time project Cost-effectiveness Partnership with Robust vendor completion large international eco-system manufacturers COMP
Slide 16: Utilising Corporate Strength (Contd.)
UTILISING CORPORATE STRENGTH - (Contd.) Constantly improving Quicker project Recorded low gearing, focus on customer- completion than industry high credit rating, centricity and standards low-cost debt contractual obligations. Delivered most EPC and Management of customer Zero Penalty Record Transmi
Slide 17: EPC
EPC Transmission Asset Ownership Green Power
Slide 18: Delivering Consistently
DELIVERING CONSISTENTLY 68% ₹ 2,500+ million ROCE of EPC as on annual cash surplus 31 March, 2021 ₹ 16,062 million 15% size of order book as on EPC EBIDTA Margin over the 31st December, 2021 last 5 years 24 months 90% revenue visibility Revenue of the total business from EPC as on 31 March, 2021 COM
Slide 19: Major Domains of Operations
MAJOR DOMAINS OF OPERATIONS » Turnkey solutions to captive power EHV substations » Power distribution systems to power plants intensive industries » EHV substations up to 765 kV (AIS/GIS) » Balance of Plant » Offsite piping systems » STATCOM installation up to 250 MVaR » Oil handling plant process i
Slide 20: Operating Philosophies
OPERATING PHILOSOPHIES » Well-planned projects executed in sync with cash flow and contractual obligations » Focus on PAT/retained cash (not size of order book) » Conservative project management approach » Cash rich; low gearing; income mix (lumpy and annuity) » Zero penalty record; » Marginal worki
Slide 21: EPC Order Book as on 31st December, 2021
EPC ORDER BOOK AS ON 31st December, 2021 Name of the client Amount in mn 26.84% PGCIL 4,310.8 ₹ 1,682 million Generation 22.85% REC Power 3,670.2 Distribution Co. Ltd ( JKPDD) 13.80% Sterlite Power 2,217.3 Transmission 10.47% Damodar Valley 1,682.4 Total - Corporation ₹ 10,005 million 100 (in %) 6.9
Slide 22: EPC Financials Over the Years
EPC FINANCIALS OVER THE YEARS Revenue (₹ in mn) EBITDA (₹ in mn) FY 20-21 7,916.87 FY 20-21 1,436.42 FY 19-20 7,843.49 FY 19-20 1,403.03 FY 18-19 8,791.51 FY 18-19 1,537.97 FY 17-18 11,733.70 FY 17-18 1,832.87 FY 16-17 12,109.45 FY 16-17 1,812.37 PAT (₹ in mn) FY 20-21 1,371.54 FY 19-20 1,331.94 FY
Slide 23: Transmission Asset Ownership
EPC Transmission Asset Ownership Green Power
Slide 24: Creating Value for TEECL
CREATING VALUE FOR TEECL Jhajjar KT – Haryana – Patran – Punjab – (Completed Kohima– Nagaland–(Completed (Completed and Exited) and Exited) and Exited) » 400 kV transmission system » Build, Own, Operate and Maintain » Build, Own, Operate and Maintain comprises Double Circuit Quad (BOOM) transmission
Slide 25: Encouraging Scope
ENCOURAGING SCOPE » Leverage EPC knowledge as transmission asset complements EPC » Enhance valuation and profitable encashment opportunities with long-term annuity incomes » Generate operations and maintenance revenues » Improve scale and stability with asset ownership » Reduce requirement to bid ag
Slide 26: Green Power
EPC Transmission Asset Ownership Green Power
Slide 27: Ensuring Sustainability
ENSURING SUSTAINABILITY Key highlights of the segment » Sold 44.45 MW of wind power assets at an effective valuation of ₹ 2,150 million during the Q1 FY 2016 » Sold 33 MW of wind energy assets at an effective valuation of ₹ 1,650 million in January 2017 » Exited the assets at the same price at which
Slide 28: Current Asset Overview
CURRENT ASSET OVERVIEW Wind Project Capacity 18 MW 111.90 MW Date of Acquisition/ During 2009-10 March 31, 2011 - February 24, 2012 Commissioning Location Karnataka Tamil Nadu Capacity 12 turbines x 1.5 MW each 48 turbines x 1.5 MW each; 19 turbines x 2.1 MW each PLF 18% - 24% 24% - 28% Tariff ₹ 3.4
Slide 29: Divesting Green Energy Assets
DIVESTING GREEN ENERGY ASSETS Revenue (₹ in mn) EBITDA (₹ in mn) PAT (₹ in mn) FY 20-21 1,000.35 FY 20-21 725.08 FY 20-21 325.32 FY 19-20 918.17 FY 19-20 758.85 FY 19-20 354.21 FY 18-19 1,094.92 FY 18-19 954.12 FY 18-19 467.00 FY 17-18 1,241.85 FY 17-18 1,106.15 FY 17-18 682.05 FY 16-17 1,457.73 FY
Slide 30: India's Data Centre industry expected to grow significantly
As one of the world’s largest data subscriber population adapts to a new digital life, India’s Data Centre industry is expected to grow significantly.
Slide 31: Aligned to the Big Picture
ALIGNED TO THE BIG PICTURE Vision To create multiple ultra-scalable, hyper-density Data Centres. » Develop hyper-density Data Centres of 250 MW by FY2028 across India » Build an ultra-scalable, hyper-density Data Centre of 24 MW IT Load in Chennai, Tamil Nadu by FY2023 » Build an Data Centre of 25-3
Slide 32: Aligned to the Big Picture (Contd.): Chennai Data Centre
ALIGNED TO THE BIG PICTURE (CONTD.) Chennai Data Centre SIRUSERI, Chennai Land Size & Built • Land Size – 4 acres Up in Sq. Ft. • Built Up Area – Approx. 200,000 sft Sq. Ft. Power Capacity • TEECL has captive renewable energy (wind turbines) of ~112 MW in Tamil Nadu, generating 220 MU annually. Time
Slide 33: Financial Review
@...: Review
Slide 34: Analysing Quarterly Financials – Q3FY22
ANALYSING QUARTERLY FINANCIALS – Q3FY22 Revenue EBITDA (₹ in mn) (₹ in mn) 3033.53 426.1 2117.12 416.6 2475.62 775.1 EBITDA Margin Other income (%) (₹ in mn) 14.05 1198.80 16.83 31.31 110.40 Profit after tax Interest Cost (₹ in mn) (₹ in mn) 1167.80 639.68 16.30 307.85 370.81 25.80 Q3FY22 Q3FY21 Adj
Slide 35: Analysing Financials – 9MFY22
ANALYSING HALF YEARLY FINANCIALS – 9MFY22 Revenue EBITDA (₹ in mn) (₹ in mn) 7,663.10 1,832.38 6,385.80 1,613.36 6,744.30 1,971.80 EBITDA Margin Other income (%) (₹ in mn) 23.91 1,473.00 23.92 29.24 749.80 Profit after tax Interest Cost (₹ in mn) (₹ in mn) 2,267.20 46.45 1,956.27 1,407.28 55.42 1,23
Slide 36: Annual Financials
ANNUAL FINANCIALS EBIT Revenue (₹ in mn) (₹ in mn) EPC EPC 1449.01 7916.87 7843.49 1386.54 Energy 326.31 Energy 1000.35 360.11 918.17 PAT Other Income (₹ in mn) (₹ in mn) PAT Other Income (Normal) 2,044.42 397.92 1,778.11 449.30 Other Income (One time) 438.00 0.00 March 2021 March 2020 1. Our EPC re
Slide 37: Annual Financials (Contd.): Balance Sheet
ANNUAL FINANCIALS - (Contd.) Balance Sheet (in Millions) 2020 2021 9M2022 SOURCES OF FUNDS Shareholders’ funds 14,964 16,162 18,004 Minority interest --- --- --- Loan funds --- --- --- Deferred tax liabilities 1,129 1,150 1,269 Other liabilities and provisions 478 407 908 Total 16,572 17,719 20,181
Slide 38: Techno Electric & Engineering Company Limited
TECHNO ELECTRIC & ENGINEERING COMPANY LIMITED Corporate Office: 1B Park Plaza, 71 Park Street, Kolkata 700 016
Techno Electric & Engineering Company — Q3 FY2022 Earnings Presentation on 6ix