NCC (NSE:NCC) Q1 2027 Earnings Call

0:00 Ladies and gentlemen, good day, and welcome to NCC Limited Q1 FY 'twenty seven Earnings Conference Call. As a reminder, all participant lines will be in listen only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Please note that this conference is being recorded. I now hand the conference over to Mr.. Thank you, and over to you, sir. Thank you, sir. On behalf of GM Financial, I welcome everybody to one... To FY twenty seven earnings conference call of NCC Limited. We have from the management today, Sri Raju, director of projects, Sri Sanjay Kusala, executive vice president, finance and accounts, and Shri Niraj Sharma, head strategy and investor relations.

0:55 Now I hand over the call to the management for the opening remarks, post which we can begin with the Q and A session. Over to you, sir. Thank you very much, Vaibhav. Good morning, everyone. This is Niraj. It gives me great pleasure to welcome you all to NCC's earnings call for the first quarter of the financial year twenty six-twenty seven. At the very outset, I would like to thank each of you for joining this interactive session and for your continued interest and trust in NCC. I have with me my colleagues, Mr. R. S. Raju, Director of Projects and our CFO, Mr. Sanjay Kusala. Yesterday, we have announced our unaudited financial results for the first quarter of FY twenty twenty seven, which has been uploaded on our website and shared with the stock exchanges.

1:52 We trust you have had the opportunity to review the financial statements and the investors presentation. Before we begin, I would like to draw your attention to a brief disclaimer with a request to study a detailed version from our investors presentation. This presentation may contain certain forward looking statements concerning NCC's future business prospects and profitability, which are subject to several risks and uncertainties. The actual results could materially differ from those indicated in such forward looking statements. This interaction is broadly divided into three parts.

2:40 In the first part, I will present a brief overview of the business environment, operational highlights and our outlook for the FY 'twenty seven. In the second part, our CFO will cover the detailed financial performance for the first quarter of FY 2027. In the third and last part, we will take up your questions. During the last quarter, the operating environment remained broadly stable and execution across our project portfolio gathered pace. Project progress across the sector continues to be influenced by fund allocation, client approvals, land availability, utility shifting and billing milestones.

3:26 And our teams have remained focused on mitigating this through disciplined project execution and close engagement with our clients. Our underlying business fundamentals remain robust, supported by a diversified order book across seven business divisions and established and proven project management framework. As of 06/30/2026, our order book stands at INR 81,214 crore. During the quarter, we have booked new orders worth INR 3,889 crore, mainly from our buildings and water and railway division.

4:14 This order book provides us a book to bill of about 3.5x, giving healthy multiyear revenue visibility. If we take into account the projects backed in the month of July, the total order inflow stands at INR 4,542 crore. In the first quarter of FY 'twenty seven, the company has reported a turnover of INR 5,842 crore on a console basis as against INR 5,208 crore in the corresponding quarter of the previous year, registering a growth of 12%. On a stand alone basis, the number is same, about 12% growth over the last quarter of the previous year.

5:06 The EBITDA margin for the quarter stands at 9.4% on console basis as against 8.8% in the corresponding quarter of the previous year. I am pleased to share our guidance for FY 'twenty seven with you. The order inflow for this financial year is a band INR 22,000 to INR 25,000 crore. I repeat, INR 22,000 crore to INR 25,000 crore, revenue growth of 8% to 10% and EBITDA margin in the range of 8.5% to 9%. The broad components of this order book as of first end of first quarter eight, the Building division stands at INR 22,357 crore, which is about 28% of the total order book.

5:58 The Transportation division has an order book of INR 16,344 crore, which is about 20% of our order book. The Electrical P and D stands at INR 13,312 crore, which is about 16% of the order book. The Mining division stands at INR 13,400 crore, representing 16% of the total order book. The Water and Railway division holds INR 10,994 crore, which is about 14% of the order book. The Irrigation division has INR 4,806 crore, which is about 6% of the order book. Now I hand over to my colleague, Mr.

6:44 Sanjay Pusarla, with a request to share the detailed financial performance of the company for the last quarter. Thank you, Niraj. This is Sanjay Pusarla, CFO from NCC Limited. Good morning, ladies and gentlemen. I'm pleased to announce the financial results for Q1 FY twenty seventeen at NCC Limited. Before I start the presentation, it is my pleasure to announce that the turnover in the Q1 of FY twenty seventeen, which is INR4912 crores is the highest Q1 turnover reported in the history of NCC. And as far as the consolidated turnover is concerned, we have reported INR 5,842 crores. This is also the highest turnover of NCC history.

7:37 The earlier turnover highest turnover was in standalone INR 4,747 crores, which was reported in Q1 of FY25 at console INR5558 crores in Q1 of FY25. Now I will take you to my presentation. My announcement will be in the order of order book, revenue, profitability, debt movement and some of the important balance sheet items. Coming to the order book. Our order book stands at INR 81,214 crores as at the end of June thirty, twenty twenty six. You are aware the order book at the beginning of the year stands at crores and orders received during this quarter is INR3889 crores.

8:25 The order book contains a stand alone of INR71312 crores and from the subsidiaries INR9902 crores. Coming to the revenue at the stand alone level, We have reported turnover of crores in Q1 FY 'twenty seven, against the turnover of INR4430 crores in corresponding quarter of the previous year, led by an increase of 12% reported. Consolidated turnover. Turnover reported in Q1 FY 'twenty seven is INR5842 crores as against the turnover of INR50208 crores in the corresponding quarter of the previous year, thereby an increase of 12%.

9:12 Coming to the profitability. At stand alone level, we achieved EBITDA of 9.01%, which is INR442.45 crores as against INR9.02 percent, which is INR394.82 crores for the corresponding quarter of the previous year. The PBT, achieved 5.12% before exceptional item, which is INR 232.51 crore and PAT of 3.8%, which is INR 187.31 crore in the current quarter as against PBT of 5.43%, which is INR 2 and 40.69 crore and PAT of 4.29%, which is INR 189.99 crores in the corresponding quarter of the previous year.

10:00 At consolidated level, we achieved EBITDA of INR 5 and 45.12 crores, which is 9.38% and PBIT of INR 311.64 crores, which is 5.33%, this is before exceptional items and PAT of INR216.40 crores, which is 3.7% in the current quarter as against EBITDA of 8.81%, which is INR456.12 crores, PPT of 5.15%, which is INR268.36 crores and PAT of 3.69%, which is INR 100 ninety two 0.14% in the corresponding quarter of the previous year. We'll move to the debt. At the stand alone level, the debt at the beginning of the quarter stood at INR 2,251 crores and net debt after cash and cash equivalents INR $16.67 crores.

10:55 At the end of Q1 to FY 'twenty seven, the debt stands at INR 2,410 crores and net debt of INR208 crores and at the end of quarter one FY 'twenty six that is the previous year's corresponding quarter. It is INR1852 crores and net debt of INR1497 crores. This shows an increase in debt by INR 159 crores in Q1 FY twenty seven. The debt to equity ratio stands at 0.31 at the end of Q1 FY twenty seven as it is 0.30 at the end of March twenty six and corresponding quarter of the previous year it was 0.24. At the consolidated level, the debt stands at the beginning of the quarter is INR3457 crores and net debt after cash and cash equivalents is INR2815 crores at the end of Q1 FY27.

11:53 It stands at INR420 crores and net debt at INR3513 crores And the same at the end of the first quarter of the previous year, INR1986 crores is the debt and net debt is INR1574 crores. Coming to the working capital. Excluding cash and marginal deposits. At the end of Q1 twenty twenty seven, we stand at INR 5,334 crores, which is 27% of the turnover. In terms of working capital days, it is ninety five days. At the beginning of this year, we were standing at INR4887 crores, which is 28% and working capital days was ninety seven days.

12:39 Let's get into the trade receivables. Outstanding at the end of Q1 has decreased from INR 3,336 crores to INR 3,055 crores and the number of days also decreased from seventy three days to sixty eight days in the current quarter. Seventy seven days is the number in the corresponding quarter of the previous year. Unbilled revenue. This has increased from INR 6,675 crores, which is 38% of the revenue to INR7414 crores. This is also represents 38% of the revenue on an annualized basis in Q1 FY 'twenty seven and INR6442 crores in the corresponding period of the previous year, which is 37%.

13:33 Retention money. This stands at INR2396 crores at the end of this quarter as against INR2256 crores at the beginning of this quarter. Coming to the mobilization advances. These advances stands at INR3163 crores as on 06/30/2026 as against INR 3,386 crores as on March 26. Of these mobilization advances, 60% are interest bearing and the average interest rate comes to 9.1%. Interest bearing advances decreased from 64% to 60% in this quarter. Cash and cash equivalents. We are at INR402 crores at the end of June twenty six as against INR585 crores at the end of March twenty six.

14:26 Margin money deposits and others, we were at INR633 crores at the end of Q1 as against INR631 crores at the end of March. So coming to the CapEx. We have incurred CapEx of INR170 crores in Q1 against the budgeted CapEx of INR500 crores. And EPS stands at INR2.98 crores at the end of Q1 FY twenty twenty seven as against 3.03 at the end of Q1 FY twenty twenty six, is corresponding quarter of the previous year. Inventory, we are standing at INR1815 crores as against INR1787 crores at the end of March. Investment, we are at INR867 crores, the same is the number at the end of March.

15:15 Loans to group companies, we were at INR $2.90 crores as of the end of June as it reached INR $2.95 crores at the end of March. Coming to the VIJA GARPAN status. VIJA GARPAN status as of the end of June twenty six is INR $2.71 crores as against INR $2.91 crores at the end of March twenty six. With this, I conclude my presentation on the financial numbers. I give it back to Mr. Neeraj. Thank you. We can start the question and answer session now. Thank you very much. We will now begin with the question and answer session. Anyone who wishes to ask a question may press star and 1 on their touch tone telephone telephone.

16:03 If you wish to remove yourself from the question queue, you may press star and 2. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question comes from the line of Shravan Shah from Daulip Capital. Please go ahead. Yes. Thank you, sir, and good to see you a And very good also good to see that now we have given our guidance.

16:50 So couple of questions. First, I just wanted to understand directionally. So this quarter, let's say, we have done a 12% on the execution front and margin also kind of a 9%, but we are looking at 8% to 10% year and margin also 8.5% to 9%. So does that mean that we are looking at a slightly lower growth and then margin also maybe slightly lower in the remaining three quarters? Good morning, Mr. As the numbers speak, Mr. Saad, the first quarter has been good, sort of encouraging. But the environment continues to be a bit uncertain.

17:37 It is difficult for us to assess for certainty that how the fund allocation, how things really pan out in the next coming quarters. So that is the reason we have done a detailed exercise and shared what we thought is possible for the next few quarters. So that is the reason this guidance we have decided to share with the market participants like you. Okay. So but internally, are we kind of saying there is a possibility that this number, particularly on the growth front, given the order book that we have, or maybe you can give us some color in terms of the entire 81,000 crore kind of order book is is is under execution or maybe how much is still is yet to kind of pick up in execution.

18:33 So to get a sense that what's the probability that this number, particularly on the growth front, revenue can inch up to maybe a 15% plus kind of a number? Yes. Let me answer this question a little differently, Mr. Shah. There are two critical elements to our performance. The first critical element is our ability to execute the projects. So there is not an iota of change in our capability, our ability to execute the projects. So this is something that is very much in place. The second critical element is the ability of the clients to provide the funds, make the funds available on time, give all the approvals, make all the ROWs possible.

19:29 So the performance in any quarter or any financial year finally depends on this. So this is how things are expected to pan out. And in the next quarter also, as things progress, we would be very happy to come and share with you. Okay. Okay. Great. Just a couple of things. First, I have seen in the annual report, there is a one one subsidiary, NCC Quantum Technologies Private Limited, where there is a $2.56 crore equity investment is there, which was 70 crore in FY '25.

20:16 Can you help us what is this and what this subsidiary is likely to do? Quantum Technology is a holding company for the smart meters. You are aware that we're executing two smart meter projects under two SPVs, one is Ray and one is for Mathwada. Quantum Technology is a holding company for these two smart meters. Okay. Okay. Got it. And lastly, in terms of the trade payable, is this how much as on June and the CapEx INR 500 crore for this year, that number guidance remains the same? Yes. Guidance remains same for the CapEx, INR500 crores whatever we have given. And for the trade payables, it was INR771 crores as of the end of June twenty six.

21:09 Okay. Thank you and all the best sir. Thank you. Thank you. The next question comes from the line of Ankit Shah from LRR Capital. Please go ahead. Hello, ma'am. Can you hear me? Please unmute yourself and proceed with your question. Ladies and gentlemen, as there's no response, we'll move on to the next question. The next question comes from the line of Aditya Sow from HDFC Securities Limited.

22:01 I hope I'm audible. Yes, you're audible. I had a few queries. Firstly, the JGM front, if you could help with the what how much would be the collection that we would have received in Q1? And what is the outstanding as of now? The outstanding for the JJM as of June 26 is $10.43 crores for the UP water projects, okay? Okay. So in the case of order execution, you were asking about collection in the first quarter, right? Yes, sir. Yes. In the first quarter, we have collected about crores.

22:52 This is corresponding to the UP projects. If you ask me overall JJM projects, the overall JJM projects, including the surface water and the groundwater, The total is INR 2,771 crores is a UBR and the amount collected during the first quarter, this is INR $6.10 crores. INR $6.10 crores. In the first quarter. Understood, sir. And sir, what sort of receivable days are you looking at in terms of the GGM projects over there? We started getting this money and in the month of July also, we have got a good money of about INR $4.13 crores from the JGM. We're expecting that this flow of money, release of payment should continue.

23:39 And with that expectation, we are expecting to complete substantially the JGM projects in the current year. Okay. So by the current year, we are expecting to close the JGM projects that we are part Substantially, will close provided the money flow also continues like this. Okay. Obviously, On the two questions on JZM that I have was, what would be the pending order book for the JZM and the balance sheet exposure for if you can provide those two numbers for JZM part? We have given you already the amount receivable that is INR $2,007.71 crores. And as far as the order book is concerned, we have complete orders like for surface water and the groundwater INR 5,881 crores as of the end of June twenty six.

24:37 Understood. The overall, if I could look at the overall bid pipeline, what would that be for us as of now? Sorry, I couldn't get you. Can you repeat the question, please? The bid pipeline, I was looking for what sort of the pipeline I would have In the first quarter, we have shared this number, Mr. Saur, the prospective pipeline of projects is about INR 2.5 lakh crore as of first quarter. We don't revise this number quarter to quarter, but this is the prospective pipeline we have. Okay. Understood, sir. And just I think I'm just trying to understand on the commodity prices, because I think commodity prices are increased. Any impact if you would have seen towards the payments and the execution?

25:27 Like what is your view, I mean, on that front because of this increase in the commodity prices? As far as the commodity prices are concerned, like regular commodities, steel, cement, we are not seeing any price increase. But the commodities which are related to the link to the petroleum products and aluminum and copper, we are looking at little price increase. And also the OFC cable, which we are using in our Bharat plant projects. There also we are seeing the price increase. But in the first quarter, whatever the impact is, whatever material we have used that is from the turnover what is there in our hand. And in the second quarter, we are expecting the prices to stabilize. If the prices are stabilizing, I hope that impact will not be there.

26:16 Not much of impact will be there. Understood sir. So, price increase Sorry to interrupt sir. May I request you to please rejoin the queue for any follow-up questions? Just just connected to that one. Just just one thing. So the price increase that you are seeing, like, you know, how much are you able to pass on that that that... That's also my end. So we have almost like 81% of the contracts we have the price escalation. So whatever price increase is coming, it gets partially compensated with the price variation clauses that are existing in our contracts. Understood, sir. Understood. That's it from my end. Thank you so much, sir. Thank you. Thank you. The next question comes from the line of Parvesh Kasi from Nuvama Group. Please go ahead.

27:03 Hi. Good afternoon, gentlemen. Thanks for taking my question. So two questions from my side. First, in the smart meter projects, what is the pending equity from our side? There is no pending equity from our side. Whatever money need to be invested in this smart meter project that has been completed, we have invested about INR $4.60 crores as of the end of March. No further equity requirement is there at the moment. And second question, I mean, over the last two quarters, we have seen improvement in execution, also an improvement in payment cycle. So as things stand today, you would believe that today, the payment cycle from state government project is far better compared to, let's say, what it was at same time maybe last year. Would that be a fair assessment?

28:03 And I'm not talking only about the JGM projects, but overall, I mean, what is your view on the payment cycle now? Firstly, Mr. Kaji, good morning. This is Niraj. We are executing projects in several states, not one and two. So it would it keeps changing from state to state. But I think it is not helpful to go into all each of the each states individually. So by and large, we could say that things seem to be improving. But we have a lot of the states, the state governments will have a lot of different kind of projects, which are managed by different arms of the government. So it is not that you could just one size fits all. In a same state, there could be some problem in some projects in the same the other projects in the same state might be getting paid fast. So this is a very nuanced kind of situation.

29:03 And we keep monitoring almost on daily basis and accordingly make progress. Sure, sir. Thanks. Thank you. The next question comes from the line of Vishal Periwal from PL Capital. Please go ahead. Sir. Thanks for the opportunity. I have two questions. First, in terms of order book breakup, can you provide this in two state, private and center? And second is in order book that we have, are there any slow moving order? Or I mean, have you received the mobilization advance for all of them? Any color that we may provide will be helpful.

29:50 Generally, in our order book, what we do is that if there is a very slow moving order or maybe a nonmoving order, we don't consider that. We generally remove it from that. Okay. And what is the other question? The breakup of the state government, central government and private sector. Yes, the central government orders constitute about 14% and state government orders constitute about 19%. PSUs and state government entities, they were about 60% and ADB, AIB and banks, it is about 5%.

30:37 And from the private clients, we started taking orders, which constitute about 4%. Okay, okay. And maybe one just a follow-up, I think you mentioned slow moving orders, we generally remove it. But I think a couple of quarters back, there were certain orders say JJM and maybe like in Mahasta. So is that fair to understand? I mean, there is no such order, which is part of the order book and probably everything we are executing. Maybe the pace of the The entire INR 81,000 crores of orders are up and running now. Okay. Are executable orders. Yes. Sure. Sure, sir. And this is helpful sir. And thank you very Thank you. The next question comes from the line of from JM Financial.

31:27 Please go ahead. Yeah. Sir, you mentioned that the order book for JM is roughly 1,500 crores. So of that, what would be of longer term nature, so there will be an O and M component as well? It doesn't have any O and M component. It doesn't have any O and M component. What I have told you is that in the order book INR 3,524 is only the groundwater. If you take the surface water, it is INR 2,358 crores. The total order book as of the end of June twenty six is INR 5,881 crores. Sir, so if the payments are on time, so this entire backlog can be executed in next twelve months?

32:14 Substantially, it can be completed. Okay. So secondly, on the VIZIP side, how much receivables are we expecting to recover in this year of the $2.71 crores? By December number. It is by December 26. The entire amount? Yes, supposed to come by entire amount by December 26. Sir, how do you see the debt number moving by March 27 from INR 2,400 crores? Maybe it is flat. Ours may come down also depending on the collections what we are expecting from the JTA. So you mean flat on a Y o Y basis? Sorry?

33:00 So flat number on a Y o Y basis by March 27, so it was 22 to 15,000,000 last year. So similar number in FY 2027 as well, March 27? Yes, more or less it will be the same number. It would depend on the collections that we get to see. It would be a function of that. Okay. Okay. And sir, lastly, what would be the AP capital city receivables right now? One second, AP capital. I remember it was around INR 150 odd crore last year. The AP capital the capital city old projects, okay, which was there at the end of March twenty six is about INR 142 crores.

33:57 So we are expecting that the entire money to be realized in this quarter or maybe early next quarter. Okay. Thank you, sir. Those are my questions. You. The next question comes from the line of Abhishek Maheshwari from Sky Ridge Fund Managers. Go ahead. Hi. Thank you for taking my question. Sir, just one, wanted to talk about your annual revenues. The amount has kept ballooning year over year, and it's growing faster than your revenue rate. So is it that the flow of unbilled revenue to revenues is lower than what you would ideally like it to be?

34:47 Obviously, because this unbilled revenue also out of that INR7414 crores, about INR $7.80 crores to 800 crores that has been certified in first week of July. So that has come down to that extent. And given the contracts nowadays, the contracts are based on the milestones That is the reason there is a little bit of increase in the unbilled revenue. But we are expecting that unbilled revenue should get smoothened over the next quarters because the BSNL billing also will start where we are exhibiting for BharatNet, the billing also will start. It will get converted from unbilled revenue to revenue. This is what we are expecting over the next two quarters, it should smoothen.

35:34 So just a follow-up. So with next few quarters, the revenues might be a little lumpy in terms of growth. It will not be consistent because a lot of unbilled revenues you have as in when milestones keep getting hit, the revenues will keep getting recognized. Am I correct in assuming that? No, no. Because unbilled revenue is already detailed as revenue. Whenever the unbilled revenue converts into certification, what will happen? Unbilled revenue will come down, your certified revenue will go up. So it will not change the revenue numbers. We change the data. Yes. No. Okay. Got it. Got it. Understood. Yes. Thank you. The next question comes from the line of Krish Bhatia from Anandrati.

36:29 So my first question was on the Kalimatua project. There have been protests around land acquisition, compensation and rehabilitation, and there were reports of work at the Orin Dam site being disrupted. So given that NCC is executing that package, could you update us on the current execution status? And have these issues affected site availability, execution? Or do you see a risk to project time line? Yes. Mr. Bhatia, Firstly, this is the first interlinking of river project that has been taken up in India. This is the very first project, and we are fortunate to have this project. And I am happy to report that we are making reasonably good progress on this report. Yes, we have seen all these media reports, and we understand that the local administration is in touch with the agitators and the issues are slowly getting resolved.

37:28 Okay. So contractually site handover execution gets delayed because of land acquisition or rehabilitation issues. Mr. Baty, as I shared with you, we are making reasonably good progress. And this site that has been widely reported in the media is about 20, 30 kilometers from our actual site. So there is no great impact as such. And this is an issue between the local administration and the agitating population, and we hope the issue is slowly getting resolved. Okay. Thank you. That's all from my side. Thank you.

38:14 The next question comes from the line of Parikshit Kantupal from HDFC Securities. Please go ahead. Yes, sir. Hi. My first question is on the debt number. So your if I see Y o Y, your debt was INR 1,500 crores, stand alone net debt and consolidated net debt was INR 1,600 crores. And now in Q1 it has gone up to INR2000 and INR3500 crores. So substantial jump in consolidated debt. So what is can you please explain that what is the increase? The increase is mainly on account of fresh debt we have taken in the smart meters. About INR 400 crores, INR $3.70 crores we have taken debt on the smart meters.

39:00 So the reason for increase is only that. And also we are taking some equipment at the old co level, the CapEx requirements are there. So about INR160 crores, INR170 crores per CapEx requirement also we have used some of the loads. So the increase Y o Y is about INR 1,900 crores. So that is the reason I was asking in the current quarter, you get the gross amount INR INR 2,500 INR 1,900 crores when you compare it to with June 25? Yes, yes, June 25. So, you ask me from June 25, if you ask me the loan which we have run for our smart meter projects is about INR $13.50 crores. INR $13.50 crores.

39:46 Yes. So it's a project. Basically, you have to have so out of the INR 3,500 crores of total net debt in that stand alone level sorry, in the confound level, approximately INR $13.50 crores comes from smart meter. If you ask me for cumulatively, if you ask me it is coming to $14.61 because we were talking about from June 25. But if you ask me cumulatively the debt of smart meters at the end of June twenty six is $14.61 crores, out of that 4,019. INR1461 crores is the part of INR3500 crores of net debt, right? So, up to take some debt of INR3500 crores, so then you split up, split that net debt of INR3500 crores due to standalone and control. Out of that, $14.61 is... Out of 3,500, it is $14.61 is the smart meter debt.

40:43 So second question is what is the BharatNet order book right now paying your voice is not audible, not clear. Can you repeat the query again? So Bharat, net order, what is the total residual order book? And since the optical fiber prices have gone up significantly, so is it a pass through for us whether we make margins on this project or there'll be losses in the current crisis? So what we are expecting is that the current prices with the current prices even we are taking up with concerned authorities at the client level at the ministry level also.

41:35 We are asking them to look into that to ensure that the supply also domestically it is available at a reasonable fairly reasonable prices. But at the moment, what we are doing, we are doing other infrastructure works, which are not involved with the OFC. But OFC also will be doing it continuously. It's a long project. It's a long project. Prices might change also, but it's a long duration project. So it is not that the price, which is prevailing in the market will continue for eternity. This might undergo some change. And we are in regular touch with the authorities, the concerned departments, and we have not we only, all have raised this issue with the client, and we are hopeful of some kind of resolution in the What near is the pending order books and is it a fixed price contract on the optical fiber side?

42:36 6,500 is the balance order to be executed. Is it a fixed price contract, I mean especially the optical fiber part? Yes, it's a fixed price contract. Okay. And if the current prices prevail and if you have to execute, then there'll be a loss on this, right? It may not be resulting into a loss, but it will result into a lesser profit. But what actually Mr. Neeraj explained to you, the prices will not be continued forever like this. There can be ups and downs in the prices. We are expecting that the prices will get smoothened over a period of time. It's a long decision project, Mr. Kanpal.

43:21 So as I said, and it is not only about NCC, there are other bidders and the whole future of the BharatNet project depends on how these prices and not only the price, we unduly always focus on the price and do not look at the availability part of the cables. Unless these issues are sorted out, it would be very difficult for to timely complete the total BharatNet project. So as I brought to your attention, we are in regular touch with the client, and we are hopeful of some kind of resolution in the next few quarters. Okay. Just the last question, sir, on the execution. Thanks for I mean, we have been persisting with you to give guidance and at this time you have given it. So the question is, you earlier in the call said that challenges about the challenges and one or two points you gave. But till now in this quarter Q2, have we seen the execution intensity reducing?

44:20 Or is it in line with your expectation or the run rate you were seeing in Q1 FY 'twenty seven? Could you please repeat your question, Mr. Khanpal? Your voice is not very clear. I was sir. I was asking you and earlier two earlier questions said that the execution will depend on the collections and the site availability. So given that you have done surprised us positively on the execution in Q1. So in Q2 till now, July month and August, so is there any challenges on execution and the site availability? Or is it as usual execution which you have done in Q1 is a similar kind of like there is no challenges and the execution is happening smoothly? That is what I wanted to know. As we speak today, it is moving smoothly.

45:10 We are making good progress. But as I have called this out in trying to answer one question on the related subject, the environment remains uncertain, and it is very difficult to say for a certainty that this is how the future quarters would how would the fund allocation. But to cut a long story short, as we speak today, things appear to be the same as last quarter. Sure. You, Nishida. Those are my questions. Thank you. Thanks. Thank you. The next question comes from the line of Manav Patra from Disvelado Advisory. Please go ahead. Hello. Am I audible, sir? Yes, you are audible.

46:00 Yes. So sir, I wanted to ask about the private sector book basically. Historically, government projects have dominated your order book. So are you seeing buildup on the private sector book also? We are slowly entering into the private sector. And as I said earlier, the private sector order book consumed about 4% of our total order book. And we are also looking into those private sector projects also. Slowly, are getting into. As you are aware that NCC predominantly deals with state government, central government, okay, banks like ADP or World Bank. But now we are also entering into the private projects, slowly we are entering into it and likely that we will see some kind of our entry into the private projects also increase in the entry of private projects also.

46:55 Okay. Just a follow-up, I also wanted to ask about like what is going to be your debt profile in the next two to three years? Do you expect the leverage to you to increase in FY 2027? Your wife is not very clear. This is lot of repo. But I think you are asking about the debt level for the next two, three years, right? That's your question, right? Yes, yes, yes, sir. So it is very difficult. See, we have just shared the guidance for FY 2027. And the process that we follow in NCC, generally, we talk about the guidance for the next financial year at the start of the financial year. So it is very difficult to talk only about debt in the next two, three years on a stand alone basis.

47:46 So next year, when we share about the guidance, maybe we'll talk about this. To add a few things on this, now the even is also changing, now the contracts are coming on either PPP mode or M mode or annuity mode. So given the type of contract we are going to win depending on the debt profile also will be changing. So that is the reason I think Meeraj was mentioning that it's very difficult to predict now because the way the contracting is happening today is completely different what it was before. Okay. Thank you, sir. That was my thought. Yeah. Thank you. Ladies and gentlemen, you are requested to restrict your question to one question per participant.

48:31 I repeat, you are requested to restrict your question to one question per participant. The next question comes from the line of from Safire Capital. Please go ahead. Hi sir. Thank you for the opportunity. So on a blended basis, how do we look at FY twenty eight in terms of revenue and margins? Now that we have started picking up on our execution and we expect prices to go down a bit, I mean stabilize to some level? Adam, we have just shared the your wife is very feeble, not but I think you're talking about FY 2028 guidance. The process that we follow in the earlier question, I have shared the same thing. We have just shared the guidance for FY 2027.

49:23 And after the completion of this financial year, we should be in a position to talk about our guidance for FY 2028. I do not have any guidance whatsoever to share for FY 2028. Okay, sir. No problem. And from the OFC side, how much revenue hello? Yes, yes, go ahead, please. On the OFC side, how much revenue have we recognized in Q1? OFC side means which side are recognized? She was talking about Parqs, am I right? Yes, yes, yes. We did about INR185 crores in the Q1 and cumulatively up to date we have done about INR620 crores.

50:11 Okay, sir. Got it. Thank you and all the best. Thank you. The next question comes from the line of Saket Kapoor from Kapoor Company. Please go ahead. Namaskar, Niraji and team. Hope I'm audible. Yes, you are. Namaskar, Sake ji. They never, sir, opportunity. As a prudent management, we have always apprised the market, the investors and also alerted us when the timing was not correct to give guidance. But overall, we... It is always prudent to it is always prudent to see that we we guide and deliver above above the guidance. So is is that prudent see... Can be expected from NCC also that we are a conservative management and whatever we have guided, our aspiration or endeavor should be to stay above the same both in terms of revenue recognition as well as in terms of EBITDA margin. Is this understanding fair on part of investing community?

51:17 Thank you, you, Mr. Kapoor, at the very outset for the kind words. We hope to live up to continue to live up to your expectations. Okay, sir. And then looking into the deeper linking project part, can you please summarize what is the value and how much have we mobilized? And and secondly, sir, out of this, as you mentioned, Niraji, that in the beginning, that 81,000 crore worth of orders are in mobilization phase in some phase or the other. So what should be the expected execution period for this entire things in entirety to get executed? The average period. INR 11,000 crores of order book consists of many orders, which are spanning between two years to five years, okay. If you take a mining order, which is almost like seven years.

52:12 And if you take other orders, they are spanning some of the orders are maybe two years, some of the orders are between three to four years. So but one thing what we can say is that all these INR 81,000 crores of orders are in executable mode. Now only the orders which we have received in this quarter about INR3889 crores, they are the orders which were received in the current quarter. They will start producing the turnover maybe from the third quarter onwards because the initial mobilization is time is required. As far as the Ken Betva is concerned, the total order value is INR 3,390 crores. And so far, we have executed about INR116.35 crores.

53:03 And thirdly, the Kennebago project, we have already completely mobilized at the site. All the equipment has been received. Now the season also will start. Probably if rains are there, there will be a little slowdown in the progress. But if the rains are not there, the progress will be good. Right, sir. And only to add sir, in the smart meter Sorry to interrupt sir. Okay. Fine. Okay. Fine. I'll join the queue. Yeah. Yeah. Yeah. Yeah. Thank you. Thank you. Next question comes from the line of, an individual investor. Please go ahead. Hello, sir. Smart meter SPV, where you mentioned there is a, you know, build annuity from FY 2728 onwards. How does it work, sir? What is the annuity income that we can expect?

53:57 Hello? Yes, sir. Whatever the O and M actually the CapEx part will be completed by March 27. We are expecting that all the smart meter projects either at Maharashtra or Bihar will be completed by March 27. By that time the CapEx part will be over. Then we will have the O and M revenue, which will be consistent and on a regular basis it will be accruing to the organization. What would be the revenue sir, roughly, any estimate sir? I'll come back to you on this. Maybe offline, I'll come back to you, sir. I do not have right now, I don't have any number right now. But generally, what happens is that for every one lakh meters that we are coming into operation, we'll be generating about INR 1 crore of rupees for the O and M.

54:58 For every one lakh of meters coming into operation, we'll be generating INR 1 crore of rupees per revenue, as O and M revenue. Okay. So the projects will get over by I mean the CapEx start by March 27. Hopefully, given the situation what are happening now, the prevailing time. So we are expecting that the project should be completed by March 27. I mean, whole INR 6,800 crores approximately? Yes. We have even mobilized ourselves. We have our resources and we get up and to execute that whatever number of people are required, contractors are required, we have mobilized ourselves to ensure that we complete the project by March 27.

55:48 Sorry, what about the inventory revenue that you are talking about, is there a straightaway goes into a bottom line, is service kind of revenue or there is any overhead for that? There will be overhead, sir. Thank you, sir. That's all. Thanks. Welcome. Thank you. The next question comes from the line of Karan Gupta from Kavi Capital. Please go ahead. Yes, sir. Thanks for the opportunity. Just wanted to follow-up from the previous question on the smart meter project. So when bidding for the project, was what was the underlying return on capital that management was looking at? We were looking at IRR of 18%, and we expect that we'll be maintaining that in the project.

56:45 Okay. And is that on total capital or on equity? Yes, on the total capital. And just one more question, how many total meters are expected to be installed under those projects? So we have so far installed about 45% of the total meters that are required to be installed. And if you ask me, we have done. 7,000,000 to 8,000,000. Yes, 7,000,000 to 8,000,000. And we are supposed to we have installed more in the case of Maharashtra about beyond 50% and it was little lower in the case of Bihar. The average, it comes to about 45% of the total meters to be installed against all the three contracts.

57:38 Sir. INR 7,000,000 to 8,000,000 Sorry to interrupt sir, may I request you to please Yes, give me to follow-up because the response wasn't very clear. So INR 7,000,000 to 8,000,000 was just was the total number that is expected to be installed or is that what you've already installed? No, no, no. 7,000,000 to 8,000,000 is the approximately total number of meters that we are expected to install in all these three smart meter projects. Two projects are in the state of Maharashtra in SPV and one project is in Bihar, which is in our NCC's parent company's name. So we are I am talking about the total number of meters, which are expected to be installed. And as my colleague has already answered, we have already achieved about 45% of this number. The next question comes from the line of Srima Threadi from Reinvestment.

58:36 Yes, sir. Thank you for taking my question. So I have a question regarding the approximately INR 180 crores receivables from the Telangana government relating to Mr. Bhagavatta. So which was subject to recently I got questions. Could you please update on that whether how much amount is received and what is the special? We have received about INR50 crores against that. And we are expected to receive the balance money also at the rate of 15% every month. Subjudice. It's a subjudice matter, it's a subjudice matter. This is being monitored by the courts. So it is very difficult. I mean, we hope to get paid as per the schedule.

59:24 Yes, sir. So, again, if suppose if the government doesn't provide on a monthly basis, so will you again fight through judicial? I mean, will you continue proceedings or will you take back off? No, as Mr. Neera said, it is a subjudice, I will not be able to dwell on that. It is very difficult Mr. Eddy to say all these. A matter of subjudice and why are we hoping that this will not get paid, we are waiting. We are hoping. No, I see like some of the cases were back off from the NCC itself. The previous, I mean, like there are a couple of cases. So which we have initiated were again back off. That's the reason why so. Right. 180 crore is almost like 5% of the total receivables. 100 crore is something 5% of total receivables.

1:00:11 So that's the reason I was asking. This is subjugious matter. We have nothing more really to add. Okay. Thank you. We have the last question from the line of Shravan Shah from Dollar Capital. Please go ahead. Hi, sir. Sir, just two things in terms of the depreciation and the finance cost. So whether the JMLR or TBM, the current depreciation in this quarter, let's say INR 67 odd crore, when can we start seeing the... This this going up and to what extent it can can go up on a quarterly basis? And at the same time, in terms of the finance cost also, so the broadly kind of a 3.23% of the revenue, that's the way one can look at or given that recently the gross rate has increased, so we can see maybe a slight increase from here also?

1:01:15 Two things. One is on the depreciation. We are expecting that TBM will also start functioning from now. Once it starts functioning, probably maybe from the third quarter, the depreciation also will go up. First quarter, fourth quarter will depend on quarter. Third quarter it will start we will start recognizing the depreciation on the TPM. That is what. And second thing you are asking on the interest. Given the situation, if the payments are coming, we'll be maintaining the same kind of percentage of interest cost. And we are looking at the corrections in the coming months. If these corrections are coming, probably the interest case cost may get softened.

1:02:05 Okay. Got it. And thank you and all the best sir. Yes. Thank you. We'll take that as the last question. And I would now like to hand the conference over to the management for closing comments. Thank you. And over to you. Thank you very much for your very enthusiastic participation. Thank you. Have a good day. Thank you so much. Thank you, everyone. On behalf of JM Financial, that concludes this conference. Thank you for joining us and you may now disconnect your lines.