Transrail Lighting (NSE:TRANSRAILL) Q2 2027 Earnings Call

0:01 Ladies and gentlemen, good day, and welcome to Transrail Lighting Limited Q2 FY 'twenty seven Earnings Conference Call hosted by Nuama Institutional Equities. This conference call may contain forward looking statements about the company, which are based on the beliefs, opinions and expectations of the company as on date of this call. These statements are not guarantees of future performance and involve risks and uncertainties that are difficult to predict. As a reminder, all participant lines will be in a listen only mode, and there'll be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during this conference call, Please note that this conference is being recorded.

0:48 I now hand the conference over to Ms. Bapi Shivale from Nuam Institutional Equities. Thank you, and over to you, ma'am. Thank you, Nirajuk. Ladies and gentlemen, good day, and welcome to the Transrail Lighting Q2 FY 'twenty seven Conference Call hosted by Nuwama Institutional I I now hand over the conference to Mr. Randeep Naram, Managing Director and CEO Mr. Rajesh Nilkhand, Group CFO and Chief Strategy Officer and Mr.

1:38 Deepa Kandilwal, CFO from the TRANSRAILL Lighting. Thank you. And Mr. Over to you, Mr. Navang. Thank you very much, and welcome to all. Good afternoon. I'm joined here with Mr. Rajesh and Deepak, as already mentioned. So I'm very pleased to share that Transrail has delivered very strong Q2 twenty twenty seven performance regarding the highest ever revenue and EBITDA. This robust performance is achieved despite the continued impact on supply chain and logistics due to the Middle East Asia crisis. This reflects better execution momentum across our projects, sharp focus on cash flow management. With this, the company's overall H1 performance is back on track to achieve the annual growth guidance.

2:25 So listing, we have not missed any of our revenue or margin guidance, and we continue to be confident to achieve the same trend this year. Our focus remains on sustaining this growth while striving for industry leading profitability and cash generation. Speaking of the numbers, revenue for operations for quarter end September thirty has grown to INR 2,056 crores, which is a 32% jump year on year. Similarly, winter stood at INR $2.38 crores, which is a 28% jump year on year quarter two. Alongside our operating performance, we've continued to strengthen our balance sheet. Our cash flow from operations is impressive, $4.35 crores in H1, while the net working capital cycle days is sustained at eighty two days from the same period.

3:12 It reflects our continued focus on collections, project execution milestones, efficient working capital management. Going forward, improving cash conversion will remain an important priority as we scale up our operations further. On manufacturing front, we have had meaningful progress in expanding our capacities. Our tower manufacturing capacity currently stands at 184,400 metric tons per annum, while completion of Phase one of conductor expansion has increased our installed conductor capacity to 40,800 kilometers per annum. We have progressed well with our planned CapEx investments to further strengthen our manufacturing base. The expanding capacity will enable us to support larger and more complex projects, improve supply assurance and have greater control of quality and delivery to meet the customer expectations.

4:03 Our order book stands at INR 14,218 crores as of September 30. While post the quarter got over, we have already declared orders of INR $17.47 crores, providing strong revenue visibility. With this improvement in order momentum, we are confident to achieve annual order intake of INR 10,000 plus crores, while maintaining a healthy book to bill ratio. The order win is also encouraging from the business diversification perspective, spanning transmission, substation, conductor and reconditioning opportunities. An important development is the order wins we've had, and we have awarded got awarded five conductor jobs in India, while we will use our own manufactured carbon core HDLAS conductors. We see this as an important product breakthrough for TRANSRAIL.

4:50 Reconducting provides an opportunity to enhance the existing transmission corridors without requiring the development of entirely new transmission routes. Our entry into these projects with our own manufactured HTLS conductor centers our presence in the conductor segment and offers some additional opportunity in transmission infrastructure market. Further, we also started booking small quantities for U. S. And other developed markets. Also recently secured greenfield JIS project in Jordan, which is 400 to seven sixty five ks transmission lines in India. Looking ahead, we believe the structural opportunity in India for our transmission and distribution sector remains strong. Rising electricity demand, renewable energy, capacity additions, increasing electrification and need to strengthen and modernize the national grid has created a sustained requirement for transmission lines, substation, HGDC infrastructure and associated power infrastructure.

5:42 We believe that not merely a near term opportunity, but multi decade growth drivers are available in the power infrastructure industry. The scale of investment in MSRs across the sector provides encouraging visibility for experienced EPC players like Transrail with meaningful opportunity in the next five years up to 3032. With the broader growth opportunity program, green energy forwarders Phase III GEC3, we expect to play an important role. The program envisages an outlay of approximately INR 186,000 crores, including INR 1.36 lakh crores only for state interstate transmission and INR 50,000 crores for battery storage. Most of this is expected in TBCP model, and hence, we expect our existing large client will be very positioned for such projects, and hence, addressable market for us will improve over the years.

6:36 As part of strategic diversification and leverage our core T and D expertise, we are evaluating opportunities and complementing our existing capability. In this context, the Board has approved to acquire 49% stake in project SPV, which is development approximately nine ninety megawatt AC of solar projects in Maharashtra. This will allow us to leverage our scale, expertise and power sector, generate long term steady returns and cash flows while continuing to maintain our primary focus on our core EPC business. As we look ahead on our priorities remain clearly defined, accelerated execution of a strong order book, maintain our order intake momentum, complete planned CapEx, manufacturing facilities, strengthen our product market and consistently improve profitability and cash conversion. We believe Transrail is entering an important phase of further growth.

7:25 The power transmission and distribution sector is poised for multi decade investment cycle with strong industry visibility, extending beyond 3032. And beyond this, we believe the structural opportunity will be a significant growth driver of TRANSRAIL in the coming years. Our focus will translate this opportunity to sustainable growth, stronger financial performance and long term creation of value for our stakeholders and shareholders. With this, I request our CFO, Mr. Deepak, to go through the financial numbers for quarter two. Thank you, Amdisa. Good afternoon, everyone. I will take you through our financial performance for Q2 and H1 financial 2027. Revenue from operation for Q2 financial year 'twenty seven stood at INR 2,056 crore, representing a year on year growth of 32%.

8:15 EBITDA for the quarter was INR $2.38 crore, up by 28% year on year, translating into a margin of 11.6%. Profit before tax stood at 158 crore, up 26%, while profit after tax was INR 104 crore, representing growth of 12% year on year. For H1 financial year 'twenty seven, revenue from operations stood at INR 3,792 crore, EBITDA was INR $4.41 crore and EBITDA margin was 11.6%. Profit after tax stood at INR $2.12 crore. On the balance sheet, our priorities remain improving cash conversion, managing receivables and inventories and deploying working capital efficiently. We have showcased improved receivable management with a reduction in trade receivable translating into higher cash and bank balances, while maintaining working capital days at eighty two days. Operating cash flow from operations during H1 stood at $4.35 crore compared with INR 29 crore during the corresponding period last year. Net debt stood at INR 143 crore.

9:23 The company is well positioned to capitalize on future growth opportunities, supported by strong execution capabilities, a healthy order pipeline and expanded manufacturing capacity. Our focus remains on ensuring that growth is profitable and sustainable, while maintaining margin discipline and strengthening cash flow generation. With that, we can open the floor for question and answer. Thank you, Deepak. Thank you very much. We'll now begin the question and answer session. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles.

10:14 Participants, you may press star and one to ask the question. A request to all the participants, kindly limit yourself to two questions per participant, and rejoin for a follow-up. First question is from the line of Harshad from Robo Capital. Please go ahead. Thank you for the opportunity, sir. Am I audible? Yes. Very much. Yes. Go ahead. Yes, sir. Thank you. So, sir, we have increased our capacity substantially. Right? And also, there are some ongoing CapEx happening for construction equipment. So just wanted to understand that once all the capacities come live, what is the peak revenue that we can achieve? So it's an interesting question. We are in EPC, so most of the production goes into our own projects in terms of requirement of towers and conductors.

11:12 And we look at facing the requirements based on the execution on the ground. Now with the 200,000 capacity by end of the year, and currently, is at 184,000 tonnes per towers per annum. We believe that this is good for us to look at an order book of INR 16,000 odd crores when we will look at this by end of the year. And we will also have this backward integration, which is already in place to support the execution of this project. And project duration is normally twenty four months to thirty months. So when we have looked at backward integration, it is to meet the peak order book and plan for the next three years. Okay. And for this 20% to 25% growth, so this growth will continue for how many years?

12:04 So we're looking at a 20% growth for at least the next three years. And based on the current plans and the order book, and this can improve also depending on how we close the year. And the further guidance on this, we can give you by, let's say, March or April of next year. So sir, this 20% growth takes us to, let's say, INR 12,000 crores of revenue in FY 'twenty nine. So do we have the capacity and, you know, do we have the ability to achieve that 12,000 crores of top line? Yes. Not a problem at all. Okay, sir. And the margin would be around Sorry. Didn't Okay. Thank you. I'll join back. You.

12:50 Participants kindly limit to two questions per participant and rejoin for a follow-up. Next question is from the line of Deepak from Swan Investments. Please go ahead. Yeah. Hi. Thank you for the opportunity. Sir, we have recently won new order, 70 crore for multiple reconditioning project using HDLS conductor. If you can give a more detail on this project, also, in in terms of the technology partner, who is the technology partner in technology tie up, and how do we see opportunity in this? And also, this would be the, again, EPC kind of opportunity, or this would be a purely conductor kind of opportunity? If you can share your perspective on these. How do we see future in this, that would be really helpful. So this is product and EPC board, product manufactured in our factory on carbon core with Epistlon, and this is a French company who's supplying us carbon core.

13:53 We are looking at not only supplying the product, but also looking at reconditioning. We have jobs with power grid in West Bengal and Tamil Nadu. So we have the technology partner, and our technology partner is also putting up a factory in India. So this is good to go. Potential of this for the next twelve months will be more than INR 10,000 odd crores, and we have the early mover advantage. Okay. Thank you, and wish you all the best. Thank you. Next question is from the line of Yash Kabra from Nirmalbang. Please go ahead. Hello? Yeah. Hello? Yeah. We can hear you. Please go ahead.

14:39 Yes, sir. So just wanted to ask, firstly, continuing on the previous participant's question. Just wanted like can you give me like because you told about 20% revenue growth for the next three years. So what are the EBITDA margins we are looking at? Can you also give some color on that? Yes. So we are talking about 11% plus EBITDA margin. The guidance given for this year, we are on track, as you see. And similar EBITDA margins are planned for the following years. So the quality of our order book is what gives us confidence that we will maintain 11% plus margins. Got it, sir. Got it. And sir, just wanted to ask regarding, like, the revenue growth is 32%. EBITDA growth is also 28%. But if you look at the past growth in this quarter, year on year, it is just 12%.

15:33 The factors relating to it is, like, depreciation has increased by 35%, and interest cost has also increased and taxes have increased a lot. So just a color on all these three factors like depreciation, I think because of the CapEx which you're doing, it has increased. But on the interest and the taxes, because the tax rate has also gone up. So any color on reference to that, please? So I request Mr. Rajesh, our group CFO, to address this question. Basically, you already answered all of the answer. We can only add a little bit more. So on the interest component, since the all of working capital funded limits, interest cost has marginally gone up on an absolute basis compared to our revenue because as we continue to grow, interest margin will grow. But as a percentage, we see it coming down to revenue.

16:31 On the taxes, it's a one off case, which we have provided in September, and that's about it. For the future, we see the tax rate coming back to what it normally is, around 25%, 26%. This was a one off scenario for this quarter. And going forward, it will be normalized. Got it. So all the PAT margins, we can expect around 67% going forward? Yes. The margin will definitely come back between 5.56% going forward. Got it, Got it. Thank you so much. All the best. Thank you. Next question is from the line of Bala Murali Krishna from Oman Investment Advisors. Please go ahead.

17:18 Hi. Good morning, sir. Congratulations. Good. And also, why do you started guidance as the performance is one of the kind of thing in the investor presentation. We were benchmarking you as well and also showing that how you performed against the guidance. That's a good sign. Yes. First question is regarding HTLS conductor, sir. So we are getting the reconducting order. If the HTLS conductors are carrying more load and whether this kind of trend continues then, is there any chance to reduce the new lines tendering this possible or this will also provide the same phase like a new line?

18:05 So both are independent of each other. This is basically strengthening of the grid in different parts of the country, as in this case, West Bengal and Tamil Nadu. And this will carry 30% more electricity through the HDLS conductor. So therefore, it is grid strengthening without investing heavily into CapEx for new line. Whereas we have a lot of new opportunities through solar power generated transmission line requirements, And both will run independently. Of course, new line potential is much higher. We're talking about going up to 9 lakh or gross by INR 3,032. This is smaller, and this is going to keep on coming. And for us, it's a good opportunity because we do make the conductor ourselves and we also do the EPC, that is the Reconductor.

18:56 And just a follow-up on this. So when you did this Reconductor, how is the margin profile? And you were talking about the French supplier, who is supplying this core. So do you have any plans to make it all in house maybe in the coming future? So we our partner, Epsilon, from France is putting up a manufacturing facility in South India, which will come into stream maybe in the next six months or more. So therefore, we don't have to put it in house, and we have a steady supply and a very good understanding with them. And on margin front, sir, is there any difference in normal... These are good jobs, and I would say they are better margin jobs.

19:45 So the second question is regarding this solar energy for effort. So what is the thought process behind this and how we are going to fund this one? So how would be the margin profile of this segment? So I request our group CFO and Chief Strategy Officer, Rajesh Nilavantar, to put some light on this. So basically, as we have been focusing on businesses which are adjacent to our core T and D business, we are looking at opportunities which will help us become an integrated energy solution provider. So solar power generation was what we found the most natural fit where using our strengths in procurement, execution of large projects, we'll be able to add a lot of value and build our book as a long term business profile. So this is where we thought getting into solar IPP was the best bet for us. And that's where we are looking at the first investment and we'll build on to this in the future.

20:59 So what could be the CapEx return for this project and how we are going to funding this and how would be the margin? So the project is about INR 3,900 crores, which is obviously funded substantially by debt, which has been already closed with a large financial institution. So there is an equity component wherein about 500 crores is what we have to put in over the next year or so. Most of it will come from our internal cash accruals, which we'll use. And there'll be some amount of debt on our balance sheet, which is something today our balance sheet is substantially under leveraged. So it will help us get a better leveraging also.

21:47 So in a nutshell, this is recurring revenue. It has good potential, good fixed tariffs. And we believe that this will help our growth as Transrail. But the core business still remains T and D and will continue to remain so. So 85%, 90% will be T and D. We are not diluting our profile in any way. Yes. Just small follow-up, sir. So the margins, I think, with follow-up generation would be around 70%, 80%. Is it understanding right? Yes. Broadly, yes. You. Thanks a lot on all your questions. Thank you for your questions. Thank you. Next question is from the line of Sahil Patani from Stokes Capital. Please go ahead.

22:40 Hi. Thanks for the opportunity. I wanted to understand over the next two or three years, how much of our business will be export led and how much will be domestic? Is a target in mind you're looking at? Because currently, we're in sixty to thirty years. So would that split remain the same? Or are you looking at more export led growth? No. So we're looking at an opportunity, which is sixty-forty, 60 domestic and 40 international. The India growth story is amazing and so is the international. We will pick and choose our spots depending on the opportunity of the project, the margin profile, the country, the country funding agency. So all those factors come in play. When we go internationally, we work only with multinational funding agencies. So the quality of the job matters. So at this stage, sixty-forty is a good bet going forward in the next two, three years.

23:32 Okay. And my second question is on your entry into like handling of solar EPC projects. So I wanted to understand because there are synergies, do you have the expertise? Or will you need to, like, let's say, hire more consultants or bring in such expertise? Or how are the synergies going to work around that? So I'll answer the first part. We are doing solar EPC anyway. We also do solar rooftops. So we are in this segment, but now getting into solar generation led opportunity, I request and our group CEO has already addressed it, but he'll give you a snap gist of it. So this is a we have got into this business as we find this business adjacent to our core T and D. And we have been as Saur mentioned, we have been doing solar projects in the past and currently doing solar EPC projects also. And as we see, we are building our teams currently.

24:33 And today, we are working with a partner and together, we are building on. And later, going forward, we obviously will be building up a team to take up some more projects as and when it comes in. Okay. And when can we expect this like the numbers to come and flow into the P and L from this new initiative? Partly, it will start flowing into next year. So we are we've targeting about 400 megawatts approximately by March or so, March, April. So part of it will obviously flow from the next year. And substantially, we expect commission by March 28, the whole project. Thank Thank you very much.

25:26 The next question is from the line of Aditya Vilekar from Fires AMC. Please go ahead. Yeah. Thank you. So my question is with respect to our top line growth, you have said 20% for next couple of years. So will our back wins capacity, which we have currently, will it suffice for that? Or we will need to invest more in terms of capacity expansion? So as I have already informed, we are building our capacity from 84,000 to 184,000. And this is further under further expansion up to two lakh tonnes by end of this year. Similarly, same is for conductor from 24,000 metric ton kilometers, we're going to 40,000 odd kilometers, and this will go up to 49,500 by end of the year.

26:24 So this is good to go because this will take care. And as I explained in the last communication, we are an EPC player who can stagger based on the need of the project, we will supply our tower net conductor. And this is sufficient for us for the next three years based on our 20%, 22% growth plan. Understood. And sir, there were some discussion regarding QIP in respect to raise some fund for BESS. So any color or any thoughts on that? So we have yet not finalized the QIP content. It will take at least six odd months more, and our cash flows today are healthy. So the timing of the QIP will depend on when we need funds and the opportunity to invest.

27:18 So right now, it's enabling resolution from the Board, and we will wait and watch when to bring it. Okay. Got it, sir. Thank you. Thank you. Thank you. Next question is from line of Aravind Sharma, individual investor. Please go ahead. Actually, I want to ask I'm I'm also... What to Aravind, your audio is not clear. Can you speak through the handset, please? How is it clear or not? No, sir. It's still muffing. Aravind, far as the clarity? Tell me, I want to ask regarding the income tax paid by the company. Aravind, sorry to interrupt you, but, again, your audio is not clear. Can you speak through the handset, please?

28:10 Okay. That's the side. Arvin, I'll request to come back. Next question is from the line of Akshay Jawar, Individual Investor. I wanted to know that the new order that we won in the last quarter, are they on fixed price contract? Are they fixed price contracts? Are they cost plus contracts? What is the terms around those? So principally, our international jobs are with the price variation. We had a mix of jobs, as we said, 60 is domestic, 40 is there. But for the domestic jobs, when we look at bidding, we form up the requirements of the commodity and we hedge immediately.

29:04 So as of now, we are fully hedged for the year and there is no risk in terms of our change if there is any commodity pricing, particularly So domestic product, like if I understand correctly, for domestic contract, whatever will be any price variation on account of fluctuation in raw materials, we'll cover for that, right? Yes. We already covered for conductor aluminum and also covered in terms of our cost management approach. And that is all embedded to our margin profile. Okay. And just on the tax demand, One, is the final order, has that come in? And is there any other open ongoing tax litigation matter, which is there? Or has everything been addressed now?

29:54 So the assessment is in process today. As we speak. We have just filed our returns a couple of months back. The assessment is in progress. And it will take its own due course, and that's about it. The assessment is something which is in the normal course, and that's something which will take up management when it comes. Okay. And so this INR 14,300,000,000 does not include any interest or penalty, right? Or has that also been factored in and paid? It has been factored. So this was a filing of a block return. So there was no penalty as such. It's tax has been paid as for the rates specified in the income Next question is from the line of Rohit Singh from Invest Analytics Advisory.

30:57 Please go ahead. Hello. Hi,. Yes. Yes.. My question is on the industry side. Could you please share your perspective on the current industry scenario, particular in terms of growth trends, or inflows, and competitive landscape? Right. Sorry to interrupt. Can you repeat your question once again a bit louder, please? My question is on the industry side. Could you please share your perspective on the current industry scenario, particularly in terms of demand trends, order inflows and competitive intensity? So if you see the industry is in a very good point moment.

31:44 We talked about INR 915,000 crores of opportunity till 3032. And we will address at least 50 percent of that opportunity in India. Internationally also, there is a huge opportunity in terms of the growth drivers for international markets, particularly Africa. So we are in a good state of growth because the markets are growing. Competition intensity, yes, it is there. There are big players and smaller players are coming in. But when we talk about HVDC projects in transmission, people who have done this before, who have backward integration, who have tower test stations, who have a full chain of backward support system to execute projects on time will be people who will thrive better than people who are not fully equipped.

32:38 So competition happens everywhere, wherever there is a growth. And we have absolutely no problem in looking at the opportunity. We, as a company, look at how and when we should pick the project. We have a risk assessment system, Matrix. And we believe that we will pick and choose the job, which will give us immediate opportunity to execute, better margin profile, good client funding, which is either domestic or international, international must be multilateral. And last but not the least is the ability to execute the project on time through the utility or through the consultants who support the utility to execute the job. So principally, what we are saying is we are in a zone of growth and Transrail is well positioned for the next five, seven years to grow well with the industry.

33:33 Thank you, sir. That's all for my side. Yeah. Thank you. Participants, you may press star and one to ask the question. Next question is from the line of Mahima from Philip Capital. Please go ahead. Hi. Thanks for the opportunity. My first question is on the bidding pipeline. I understand that we have already bid for projects worth 18,000 crore. Can you throw some light on how the bidding pipeline looks like from here on? We have a good five months to go. We are looking at another INR 30,000 odd crores of bids to be done. Work is happening as we speak, and November itself is a good pipeline.

34:20 So we are looking at a 10% to 12% win ratio, which is what we have been doing over the years. And we are fully confident that the order intake plan, what we are giving guidance for will be INR 10,000 plus crores is in the process of getting fructified. Already INR 3,500 or INR 4,000 crores is in the bag, and we believe that this is achievable and which is something which gives us the future growth guidance for next year. Got it. And what would be our L1 position currently? L1, we don't have. All orders have come. Okay. Okay. Got it. Lastly, on the product side, we mentioned that we have booked some small quantities from US and other developed market.

35:09 We had mentioned about some monopole supply in Australia also. Can you please quantify the orders that we have received and how is the margin profile there? So these are feed marketing new country entry jobs. The margin profile is equivalent to what we are quoting today in terms of our guidance. And we are developing these markets, be it U. S. Or Australia. And we have a sales team who is pursuing relationships and building these job opportunities. So this is work in progress and the jobs are small at this stage, but we hope to look at bigger market share going forward. Okay. Got it. Thank you. Those were all my questions. Thank you. Thank you. Next question is from the line of Anurag from Indira Securities. Please go ahead.

35:59 Hello, sir. Am I audible? Yes. Very much. Okay. Okay, sir. Congratulations on the good number, sir. My question is with regards to, like, we were doing around, like, 5,300 of revenue in around 2025, right? And since then, our capacity has doubled, but, like, you're guiding around 20% to 25% growth from here. So like, what is the reason for the same? See, we have put in the increased capacity, a new plant, looking at our growth plans in the next five years, when we got listed in the year twenty twenty four December, we are very clear that we have enough opportunity in order book, and the planning has happened since then in a three year vision plan. So the current capacities are good to go for the next two, three years. And if we feel that there is a need to further expand, we will do so. And that's not a problem because we have the expansion capabilities, the engineering capability and the execution capability.

37:05 Okay, sir. Got it. And one more question regards to this only. That how much of... Like, how much is capital of our own capacity? Like, how much do we use? Or... And how much do we sell outside? So today, 95% is internal use, 5% is what product marketing we are doing, and we want to improve this portfolio as the expansion of our factories happens. Okay. And, sir, do we do any projects without this backward integration coming in? No. Not really. We we look at our own products to be supplied for execution. Okay. So, like, you are saying, like, we can generate around 20 to 25% more with this capacity? Yes. As I mentioned in the last person's query, we can stagger the execution of what is twenty four to thirty months, when to supply tower and conducts to which project.

37:57 We can plan that because that's the facility and the importance of backward integration. We are not dependent on anybody else to give you supplies. So within our own factories, we can control the supply chain. Okay. Okay. So just one last question, please. Like, can you just tell me a little bit of the economics on the towers? Like, how much do we generate, like, per tower, like, per metric ton of tower and or per kilometer of circuit provided? So that cannot be answered because it is part of an integrated EPC project. They are all when we bid, it is all done on a turnkey basis, and it is all together. We don't talk about towers and conductors individually. Okay, sir. Got it. Thank you. Thank you. You.

38:43 Participants, you may press star and one to ask the question. Next question is from the line of Deepak Puraswani from Swan Investments. Please go ahead. Yeah. Sir, I just wanted to check it... Continue on this reconducting opportunity using the STM based conductor. Firstly, with the French player, do we have the exclusive tie up or this is going to be this is also available with the other players? Secondly, you mentioned... Companies are using some other manufacturer. Currently, we are with them in India. And if there is a further growth or opportunity, Epsilon or our suppliers may choose to have maybe one or two more partners, which is absolutely fine.

39:33 They are putting capacity expansion there. And we are a preferred customer, and we'll be given preference. Okay. And you also mentioned about the conductor. We have 49,000. We are looking to expand the capacity to 49,000 odd tons. Out of this, how much would be the STL based company? SG and it depends on the job we get and then it's need based. So we have supplied to Cameroon. We supply internationally also SG and A. We are now doing it in India. So the product mix can change from ACCR to AL59 to HTLS. There is no fixed formula. If we have a job, we will make it. Okay. So the plant is fungible across on the product category? Yes.

40:23 Okay. And also like you did mention about the build, just wanted to check it out, would it also offer some kind of export opportunity? Yes, very much. With our partner who is a global player, a French player, wherever they see an opportunity to support us, they do that. We also bid internationally with HDLS conductors for 20 projects. So there is an opportunity. And if there is an opportunity further in U. S, but they're also doing grid strengthening and looking at improving the grid structure, we may supply there also. These are all planned right now. Sir, particularly for this particular this segment of the business, what would be the kind of the margin or EBITDA per ton for this conductor business?

41:11 So this is in line with our margin strategy as we go currently. This is something which we believe that is a margin enabler and cash flow enabler. So we are happy that this product opportunity has come up for us, and we won five jobs. Okay. And this would also include the EPC installation along with the conductor? Yes. Production and What is it? And sir, what will be the typical cost of per circuit kilometer installation of this STL... STL S conductor using this technology? I will not be able to answer that. It is the first few jobs we've taken. Maybe after six, twelve months, I can answer this question. Thank you. Deepak, I request to come back for a follow-up question.

42:03 Next question is from the line of Sail Patani from Stokes Capital. Please go ahead. Hi. It's a follow-up from me. So, sir, I wanted to understand, you said that we'll be growing 20 over the next two, three years, right? But historically, also, we've mentioned that we kind of grow at 20%. But now with us pouring into solar power generation, shouldn't like our growth be more than that because we are having like a new avenue of growth and we are entering. So wanted to know your thoughts on that. So I think it's a very interesting and good question. Right now, these entering into solar power generation, we have just started that process, and the revenues will come in next year, and the closure of this project will happen by end of twenty eight. So as we go along and this is an adjusted revenue opportunity, we will look at changing our guidance next year as we see the fruits of this new investment.

43:04 Okay. So from FY 'twenty eight onwards, we should be seeing that? Yes. So this is long term strategic investment. Next question is from the line of Rahul from HL Technology. Please go ahead. Hi, sir. Can you throw some light on the pledging that you have done, like pledging of shares? Pledging of shares? So this was a small pledge done with the promoter for some borrowing visited. It's a normal 2% to 3% pledge only for some borrowing visit for a short term purpose.

43:52 So when do you plan to like re buy those shares or remove the pledging? It it should take about six to six to nine months. Within within the period we've just mentioned, it'll happen. I'm sorry. Your plans on this and data center, like, do you see any progress there or anything materializing at this point of time? So we are building a team. We are now building engineering and costing estimation teams. We are bidding for some jobs in data center. BEST is still a little bit far away because we have to look at the complete supply chain. So work is in progress, and we are hopeful that by end of this year, in the next financial year, we'll see results from it.

44:40 You. Rahul, I'll request to come back for a follow-up question. Next follow-up question is from the line of Paramurli Krishna from Oman Investment Advisors. Please go ahead. Yes, sir. Thanks for the opportunity. From the base and data center part Sorry to interrupt. Can you speak louder, please? Yeah. So our question is regarding base and data center part. So data center you told next year things can materialize. So what kind of visibility is there from top line front of you or how? See, we are looking at best investment announced by the government of India and GEC3 around 15,000 crores in the next five years.

45:26 We also see data center with predominantly private players to be more than INR 10,000 to 15,000 crores per annum. This is work in progress as we are expanding to understand the market potential, understanding by meeting clients. So we feel there is good enough market opportunity, and we as a company plan to go slow, look at one or two jobs first, strengthen our capabilities before we go forward. So historically, we have around 10% to 15% fine opportunity. So do you think that we can have kind of trends here? 10% to 15%. We are talking about we are maintaining our core T and D capability. These are new businesses we are getting into, and I talked about the market potential of BEST and data set.

46:18 This potential not our order intake plan. Secondly on product side, as of now I think 2%, 3% revenue coming from product sales. So in long term, do you have any plan to engage this to maybe 20%, 30% to reduce the exposure from ROE efficiency side? No. We are from current 2% to 5%, we intend to go to 7% and then see how and what other products we can bring in. So as of now, product positioning, stand alone products is going to be 5% to 7%. Got it. Thank you. Lastly, year on receivables, I think the receivables are more than six months are INR $203,100 range. So do we see any steps out there or how those are reviewed at this point?

47:15 See There is some increase in more than six months receivable, but we are focusing on the same and it will be reduced in the ensuing quarter. Okay. Thank you, Andres. Thank you, Jeev. Thank you. Next question is from the line of Anurag from Indira Securities. Please go ahead. The line for the participant dropped. We move on to the next participant. Next question is from the line of Rahul from HL Technology. Please go ahead. Like, you answered my previous question. One last question. Like as a vision, where do you see yourself as market cap in next six years?

48:05 Market cap in next six years forecast. I think both my finance leaders are scrambling their head how to predict this. So I think one of them can answer. See, market cash is something which is not something which we can predict. What we can predict is what we'll deliver as a performance and continue to focus on our guidance and our focus rest market and something which the market will determine or the industry will determine. So EPS, can you guide where would be your EPS in six years, like around 55, 60 or...

48:55 EPS in six years, I think these are two forward questions. I mean, you see our results and the trajectory we are planning, you will see all the numbers in line with what we are saying. And if you've seen our previous guidance, we've maintained that for the last two years. We intend to maintain the same for this year. So use that as a surrogate to predict the next three years. All right, sir. Thank you. Thank you. Thank you very much. As there are no further questions, I would now like to hand the conference to the management for closing comments. So I thank everybody on the call for giving us this opportunity to explain our results for Q2 and the H2 thoughts on how we plan to go forward and our guidance.

49:46 Our investor presentation also has all the details. And all I can say is we have put up on our requirements for H1, very much there, and we have had a very good Q2. So it's also something which is very opportune time that this is a Diwali, a happy Diwali to all of you and our investors. The company is doing well and strong. So wish you a bountiful of sweets, and thank you for joining the call. Thank you very much. On behalf of Nuva... And Social Equities, that concludes this conference. Thank you for joining us, and you may now disconnect your lines. Thank you. Thank