Capacit'e Infraprojects Limited (CAPACITE) Q2 2027 Earnings Call Transcript

Ladies and gentlemen, good day and welcome to the Capacity and Trust Projects Ltd. Q2 and H1FI27 conference call. As a reminder, all participant lines will be in the listen-only mode. There will be an opportunity for you to ask questions after the presentation concludes. Before we begin, a brief disclaimer. The presentation which Capacite InfraProjects Limited has uploaded on the stock exchange and their website, including the discussions during this call, contains or may contain certain forward-looking statements concerning Capacite InfraProjects Limited business prospects and profitability, which are subject to several risks and uncertainties, and the actual result could materially differ from those in such forward-looking statements. Should you need any assistance during this conference, please signal for an operator by pressing star followed by zero on your touch-tone telephones. I now hand the conference over to Mr. Rohit Katyal, Executive Chairman, Capacite Infra. Thank you and over to you, Mr. Katyal.

Good day, everyone, and thank you for joining us. On behalf of Capacity, I extend a warm welcome to all participants on our Q2H1 FY27 earnings conference call. Joining me today are Mr. Rajesh Das, CFO, Mr. Alok Mehrotra, Mr. Nishit Pujari, and our investor relations team from Marathon Capital. I trust you have had an opportunity to review our financial results. The presentation and press release have been filed with the stock exchanges and are also available on our website. I am pleased to share that we have delivered another strong quarter, achieving our highest ever quarterly revenue of 771 crores, representing a 19% Y-on-Y growth despite the seasonal challenges. This performance reflects the strength of our execution capabilities. The commitment of our teams, and the confidence our clients continue to place on us. Our growth is backed by a strong and diversified order group of 13,000 crores as on September 30, 2026, providing excellent revenue visibility for the coming years. During FY27, thus far we have secured new orders worth 2,487 crores, Reinforcing our market position and creating a solid foundation for sustained growth. Supported by our strong client relationships, improving execution intensity, and a healthy pipeline of opportunities, we remain well positioned to capitalize on the growing demand across the construction sector. We have also remained focused on strengthening our balance sheet and improving operational efficiency. Our healthy leverage profile and improved working capital performance provides us with the flexibility to pursue growth opportunities while maintaining financial discipline and creating long-term value for shareholders. As we look ahead, our priorities remain clear, accelerating execution, securing quality orders, enhancing operational efficiencies, and delivering sustainable and profitable growth. I now turn to the key updates during the quarter. This quarter saw us achieving our highest-ever quarterly revenue, driven by a significant ramp-up in the project distribution across seaside. While elevated commodity prices continued to exert some pressure on the margins, the impact was substantially mitigated through contractual escalation clauses embedded in our projects for key raw material. As execution scales are further and commodity prices stabilize, we remain fairly confident of improving profitability over the medium term. Improved working capital efficiency, resulting in a reduction of 11 days in working capital cycle compared to Q1 F527. The company added Mahindra Livescape Developers Limited as a new client, further strengthening our customer portfolio. As mentioned earlier, order books stood at 13,013 crores as on September 30, 2026, with a balanced mix of 54% coming from public sector and 46% from the private sector projects. Combined with orders secured in FY27 and a strong identified bidding pipeline, we remain confident of surpassing our FY27 order inflow target. With that, let me take you through our operational and financial performance for the quarter. Revenue from operations for Q2 FY27 stood at 771 crores, up by 19% year-on-year. Revenue from operations for H1 FY27 stood at 1,400 crores, up by 13% year-on-year. Ebitda for Q2 FY27 stood at 119 crores, up 10% year-on-year. EBITDA margin for Q2FY27 stood at 15.5%. EBITDA for H1FY27 stood at 218 crores, up by 4%. EBITDA margin for H1FY27 came in at 15.6%. PAT for Q2FY27 stood at 48 crores as compared to 51 crores in Q2FY26. PAT margin for Q2FY27 stood at 6.1%. Similarly, Pat for H1F527 stood at 87 crores as compared to 98 crores in H1F526. Pat margin for H1F527 stood at 6.2%. With that, now I leave the floor open for questions. Thank you.

Thank you very much, sir. Ladies and gentlemen, we will now begin with the question and answer session. Anyone who wishes to ask a question may enter star followed by one on the touchstone telephones. If you wish to remove yourself from the question queue, you may enter star followed by two. Participants are requested to please use only handsets while asking a question. We will wait for a moment while the question queue assembles. The first question is from the line of Rajesh Jain from RK Capital. Please go ahead.

Hi. Good morning, and congrats on a good set of numbers. So, my question is primarily on the contract assets file. So, if I look at your balance sheet, under your non-current assets, there are contract assets of two sumption and crore. Under current assets, there are contract assets of 1179 crore. And trade receivables on top of it are 1182 crore. So all put together, it comes to 2640 crore, which is 95% of your previous 12 months revenue. I want you to understand this contract assets, are all of these only retention money and unbuilt revenue, or is there something else in this? And how much of it is retention money and how much is unbuilt revenue?

So, retention money is 170 crores, which has remained steady in spite of growing the revenue. Number one, number two, the contract assets have to be reduced by 217.62 crores towards the negative contract assets. As such, the total contract assets will stand at

Let them be.

It will be divided into the following, please note it down. 1188 is towards work in process. These essentially are milestone payments, which are built. And if you see the increased revenue is only reflecting that this WIPs, in spite of increased top line, are getting converted into sales and debtors, and the debtors are getting collected. The connection for the... Corresponding six months also reflect that fact. The debtors in totality after ECL provisioning stood at, on a concerning basis, at 1,300.27 crores. And most importantly, the working capital days, quarter on quarter have fallen by 11 days. As informed during the last conference call, This trend will continue, and you will see the committed reduction in the full financial year.

Okay, sir, I'm not yet clear on one point. So, how much should I count as your total receivables? Because there is a billed receivable, and there is an unbilled receivable, right? So, if I have to put both of them together, that figure will be roughly around 2,300-400 crore, or what will be that figure?

2,400 on net basis, please.

Okay, which will be roughly around 85-90% of your previous 12-month revenue, right?

No, but this has to be taken over the revenue built up for the current financial year. It should be approximately 77-78% of the full year.

Okay, and so what is the aging of these contract assets? Like how much of contract assets are 0-3 months and 3-6 months and more than 6 months?

You can just drop in a mail. We can share that with you. However, having said that, the debtors are at 1,300 crores, all right, so approximately 120 days, which includes milestone billings, which are done and received over the next two quarters. So that is the total debtor level, and it has to be compared over the revenue projections for the current financial year and not the previous year.

Okay. And so, like, you know, when I compare with your peers, like, I think your peers are having contract assets at roughly around 18 to 20% of the revenue. So, I just want to understand why, I mean, why is that after we recognize the revenue in our books, but why are we not able to bill to the client? I understand the reason is there are certification delays, right? Maybe you're not getting the go-ahead to raise the invoice. So I wanted to understand that why does it take so long for our clients to certify the work, and why is it not the case with similar peers like Alu Alia or other peers?

So I will tell you, let the Aluwale results come out, so I will not be able to comment on that. My nearest competitors like PSP are at 78%. I do not know from where 19-20% has come. Aluwale last year was 58%. Alright, we were at 87% and we are giving a guidance of about 78% for the current year. In the same sector, other people like hotel engineering is above the top line, that is 108%. You have many companies, but I have yet to see any company having 19 to 20% what you mentioned. Contract assets, you have to add other assets as well. Under what classification the assets are lying, that has to be totaled up. All right. We have the calculations available with us. So your information, my friend, is incorrect. Nowhere in the industry anyone has a contract assets, which includes WIP, retention monies, certified debtors and non-certified debtors of 20%. The market leaders in this. Last year was Alubalia, 56. Everyone else having the A rating is close to 72-73% of the top line, and we hope to achieve in the current financial year close to 77-78.

Okay.

Sir, in general, in respect of the peers… Mr. Jain, please return to the question queue. Okay. Thank you. Participants have a request. Please limit your questions to two questions per participant. You may then rejoin the queue. Our next question is from the line of Dhanan Jai Mishra from Centrum Broking. Please go ahead.

Yeah, good morning, sir. Can you talk about project-wise contribution in the current quarter from all these projects like NBCC, Signature Global, Mahada, and also Rayman's, and also the recently awarded project like Turankara or Mahindra, when they are going to contribute from which quarter in terms of numbers?

So, out of the certified sales for the first six months, I had 178 crores. I can be up and down by one or two crores. Mada was 123 crores. Ledger Valley was 95 crores. Raymond's was 100 crores. Downtown was 111 crores. So these were the main projects. Apart from this, M3M was 60 crores. Udraj Mahalakshmi was 50 crores, IOCR Andheri was 40 crores. On the consolidated basis, MCGM Banduk gave 63 crores, and the Maldives project gave 169 crores.

And when can we start, I mean, follow up for the first question only, this Mahindra life work, when will it start from Q1 of next year or it will start from Q4?

The revenue, ideally, we should start recognizing from quarter one of the next financial year. If it starts by quarter four, it should be happy news for everyone.

My second question, as per new project is coming in, so can we expect the next two-quarter run rate will be 800 crore plus for this financial year, and eventually, as we are targeting 4,000 crore in April 28, so we will be reaching 1,000 crore quarterly run rate by Q1 or Q2 next year?

Yeah, we are planning to do that. We have already crossed in the previous month more than 260 crores. So we are well positioned to cross 300 crores run rate by quarter four, and therefore the projection of 4,000 crores for the next financial year. That's number one. Number two, our target is quite strong for the current quarter as well. However, we need to account for the NGT issues which may arise and are getting more and more stringent with every passing year. So, I cannot give, I cannot predict what will be the NGT stand in Delhi NCR for this current winters. However, we have definitely factored about 50 or 45 to 50 crores of revenue loss. All in all, we have given a particular target for the year, and we see no reason at the moment in time why we will not achieve that.

The nationwide water issue is there, so our requirement of water for construction project, so can you anticipate in certain regions government may ban this construction activity for temporarily as water levels are low across many regions. So what is your take on that?

We are urban areas construction company. So, we did not face the problem or we, let us say, we countered the issues which were during the low rainy results, resulting out of the low rainfall. At the moment, we do not anticipate any such issues. However, if something drastic were to happen, we will keep our all stakeholders informed.

NGT issue will come only in NCR region, not in Mumbai region.

No, NGT is for NCR.

Okay, that is all from my side. Thank you and all of this. Thank you.

Thank you. The next question is from the line of Tanmay Jain from Dallat Capital. Please go ahead.

Hi, sir. Thank you for the opportunity and congrats on the relevant performance. So, my first question is mainly pertaining to the labor availability that we might see, especially in the upcoming UP elections in the last quarter of the financial year. So, like, can you please elaborate on this and if possible, if you can quantify on the execution capabilities that might, you know, impact it due to this?

If you have heard my comments in the last quarterly conference earnings, I said that in India, we cannot work more than 10 months in a year because of continuing elections, because of NGT issues, because of issues which are not attributable to the company or for that matter anyone. So these are post-measures. I can only call them post-measures. At the moment, I do not see any impact. The availability currently is quite strong, all right? And we are taking all measures to retain our workmen during elections. Quarter one of the current year saw the revenue dip because of the Bengal elections. And whatever learnings have come, I think I'll make sure construction companies are trying to do that to avoid similar situation in quarter four of the current financial year.

Okay, fairly understood. Sir, my second question is mainly on the aluminum prices. If we see the aluminum prices, you know, come back to pre-war levels, and based on the commentary from the global aluminum companies, it seems like it will be overing around these levels or maybe go down. So, are, like, at these price levels still high on the, still high for us as a procurer, or we can see any possibility for reversals and the provisions in the upcoming quarters?

See, at the moment, the steel prices, which were 47,000 three months ago, today are hovering around 62,000 per metric ton. Aluminium prices have come down, but it is still away from the levels it were in the pre-war period. Aluminium foam work had gone from 10,500 per square meter to 14,500, representing a 40% increase. Yes, there will be a correction, should come down to 12,000, 12,500 for future procurement. However, at the moment, I cannot comment whether it will be in the pre-war stage. That's number one. Number two, our profitability is not impacted by higher aluminum prices because it's a short-term capex for us or for that matter of any customer and company. It is written down over the five, six-year period as per the depreciation policy of the company. It only impacts cash flow. So, if we want to spend... A crore of rupee earlier on procurement of aluminum foam work. Now we have to expend 1.4. And the appreciation in dollar has also not helped the cost. So I don't see any impact on profitability. Slight impact or negligible impact on the overall cash flow from operations at the end of the financial year. Also, I do not see any impact. So, we have to wait and watch. It would be premature on my part to say what impact this 2,000 m2 fall of aluminium would result into. Yes, electrical items will become more reasonable, but we have to give them a couple of months.

So, sir, how much capex we have done towards the aluminium framework procurement in the H1? Thank you.

We have done a total of 127 crores of total homework purchases.

And the balance that we are left out?

I would like to correct myself, I'm sorry. The total homework purchase is 64.23 crores and the plant and machinery purchase is 10.57 crores. Since the order pipeline is very strong, I do believe that the entire budgeted procurement of 135 to 140 crores will be required and completed in the current financial year. That is the balance H2.

And, sir, I am getting it correctly. At current price levels, these levels are still higher than our escalation closes.

So, if the gap was 5 or 6% in quarter, One, the gap has come down to maybe 2%. As I add to last quarter also, it takes 6 to 9 months. The government wholesale price indices do not move the way the international markets move.

Understood. So just one last question. Sir, I just want to broadly understand how asset turnover works in our business. Like, for instance, if we are targeting around 4,000 crore of revenue. So, essentially, I want to understand how capex requirements are aligned with the revenue growth. Can you just briefly give me the answer on that?

The capex requirements are directly proportional to the order intake and the quantum of projects which we start quarter on quarter. All right. However, we have maintained our 4x. This is the 4 fixed assets turnover ratio that for the quarter ending 30th, 9th, 2026 stood at 4.7.

Okay. So, I can assume that for achieving like 4,000 crore milestone, we will be in need of more capex. And basically, it's competing on a fat margin. That's what my concern was.

Sir, I think we have an industry-leading back-back margin. Our cash back margin also continues to be within the target range of 10.5 to 11.5 percent. Cash flow last year after adjustments was positive, that means after repaying 101 crore of term loads. At the moment, if on a consolidated basis, our fixed asset revenue turnover ratio is 4.7. I don't see any reason why on 4,000 crore it will not be well above 5. Again, an industry-leading number. And therefore, See, the cash flow from operations is what is most important for us. We have to ensure that after repaying our term loans or adjustment of financial adjustments in the cash flow, the company is left with positive cash flow. That is very important. Profitability, as I told, because of geopolitical issues, you saw some more deep in quarter one. It was better in quarter two, and I'm sure if the geopolitical situation improves, we will see a higher PAT number going forward. However, whatever our targets are set for the whole financial year, I don't see any reason, material or otherwise, at the moment to change that.

Understood, sir. That's all from my side. Thank you very much. Wish you luck.

Thank you. The next question is from the line of Vasudev from Nuwama. Please go ahead.

Yeah, thank you for the opportunity, sir. Congratulations on a great set of numbers. Sir, can you just give us, you know, what's the current progress on the Mahada, SIDCO, and the Signature Global Projects?

So, Mahada, out of 34 rehab towers, we have been given 25 rehab towers already. At the current level, The total rehab portion at the J.D. level will be close to 6,500 crores. So you can divide that. If you reduce about nine towers to be received, we have a clear-cut work front of close to 4,200, 300 crores as far as the rehab towers are concerned. And this figure includes price variation. On the sale residential, we have started piling on sector 8 and 9, which are the sale residential towers. Sector 10 will be handed over by the department latest by December, so we can see a serious ramp-up of revenue in the next financial year. We have already seen a ramp-up in the current financial year, but a very meaningful ramp-up can be expected in the next financial year. And just to add a caveat, 35% would be to our share, CIL's share. On the second part of CIDCO, I am happy to share that further scope of work will be added to the operational order book in the current month or so, and therefore, we expect revenues from new locations starting from quarter one of the next financial year, and therefore, we will see a meaningful revenue from the CIDCO project happening. Point number three, signature global will be impacted in this quarter due to NGT issues, but otherwise we are building close to 15 crores per month or thereabouts, and we are well in a situation that the phase one, that is titanium, we should... The NGT impact, we should be in a position to bill 18-19 crores per month from quarter for the current financial year.

Yes, that was helpful. In Mada and Sidko, is it possible to give what is our quarterly run rate price now, and how much are we expecting in Q4 and going forward?

Yes. For Citco, in the first six months, the company has done 177 crores, all right, close to 30 crores per month as a run rate. We expect this run rate to increase by 35 to 40 percent in quarter three and quarter four. And from quarter one of the next financial year, obviously, I told you that new scope has been added, and that will substantially increase the revenue. So next year, I do expect the run rate to not be less than 50 crores per month, which would mean that 150 crores per quarter and 600 crores per year. As concerned, we have done a revenue of 124 crores in the first six months. Again, we expect an increase of 25% in the remainder of the financial year, and this should increase by overall 40% from the current levels in the next financial year.

That was quite helpful. And, sir, second question is that, you know, you mentioned that water supply is not being an issue for us, and even the commodity cost prices are coming down. So, the 10 crore provisions that we did in Q1 and also in Q4, are we expected to reverse in the second half?

I cannot give a comment because you see that I would like to see the markets behaving, the geopolitical situation easing out, because oil is 115 one day, 95 the next day, someday it becomes 72. So it's too volatile at the moment, and even the dollar price is not helping. So the point is, we should give it a quarter more. If the price variation in government contracts can match the actual market inflation, Then you will see some reversal happening in quarter 4. Unfortunately, if that does not happen, it will not happen. But, you know, we should not predict the markets. Very, very dangerous to do that. But at the moment, what I can say is the green shoots are there in quarter 2. The escalation, which was much lower in Q1, as per the Office of Economic Advisor, has increased. And the gap has narrowed down substantially. And therefore, you see the improvement in profitability. If this gap diminishes in quarter three, I will be better placed to answer this question in the next earnings conference call.

Okay, sure. So, that was great. Thank you, and happy development to you and your team. You too, please.

Thank you. The next question is from the line of Parth Thakkar from JM Financial. Please go ahead.

Thank you for the opportunity. My question is regarding the wind flow pipeline. Have there been any projects where we have bid and results are yet to be awaited?

Yeah, many. So, we have active bid negotiations going on for 3,270 crores. The bid pipeline is very strong, and we see no reason why we will not surpass our annual target provided to you all.

And also, can you once reiterate the guidance for FI27?

So, FI27, the original guidance was 4,500 crore. I believe that as I speak to you today, we have done 2,500 crores or thereabouts. Sir, FI28. You want to buy FI28 or FI27?

FI27 only, FI27.

So, 4,500 was the guidance for the financial year 27. We have already crossed 2,500 crores or thereabouts. And with the bid pipeline and whatever we have submitted the bids, we are very confident of surpassing the whole year guidance comfortably.

The margins would be in the same level of 1H?

No, no, no. The guidance is for all of it. So, margin profile, we have given a guidance for the full year, and we will maintain that guidance at this moment in time. If there is improvement in commodity prices and the escalation, as I mentioned in the answer to the previous question, if the escalation matches the cost price increase. We will revisit that in quarter four of the current financial year. But the current guidance remains intact.

Okay. Thank you. Those were my questions.

Thank you. Participants with questions may enter a star followed by one. The next question is from the line of Deepak Pudar from Sapphire Capital. Please go ahead. Deepak, your line is unmuted. Please ask a question.

Yeah, I'm audible.

Yes, sir.

Okay, thank you very much, sir, for this opportunity. So just on the, continuing on the margin part, so what's the guidance of the margin for this year, FI27, EBITDA margin?

So we have given guidance in the quarter one itself of 15.5 to 16.5 at EBITDA level, and we have given cashback levels of between 10.5 to 11.25 thereabouts. And we continue to maintain that level.

So, what is 10.5 to 11?

Cash back, cash profit.

Okay, okay, okay, okay, got it. So, ideally, I mean, last year also your EBITDA margin was around 16%, 16.3%. So, ideally, if you look to grow your top line by 20%, with similar EBITDA margins, so, ideally, bottom line also, do we expect 20% kind of a growth in your bottom line?

Bottom line, yes, we have been growing at CHGR of 40% or more in our bottom line. You see that as a practice and company policy, we always discuss with you all the consolidated numbers, all right? And consolidated numbers means that where the company has joint ventures, it has got overseas projects like in Maldives, where obviously the margin profile is lower than the projects what we are executing. On a standalone basis. Because we are only taking into account our share of profit. Okay? And therefore, I see no change happening in that. On the contrary, with the Maldives project getting over in the current financial year, you will see some uptick in the margin profile next financial year.

No, sir, the reason I was asking is because in this first half, on a YOY basis, your bottom line is largely similar. We have not seen any growth in the first half. So that's the reason I was asking that in the entire year, do we expect similar revenue growth as in bad growth?

Sir, last year we were impacted positively by recovery of certain bad debts through sale of non-core assets, and therefore... This was informed in the last year's conference call as well. We have a target assets held under sale of 48 crores in the current financial year as well. We are putting all efforts to realize the value of those assets in the current financial year. If we are successful, then you will again see an uptick in the margin profile, but you have to remember this is coming from the held-up monies. I'm talking from the operating current order book perspective, 15.5 to 16.5 is the EBITDA guidance for the current year. It remains the same as what we told last year, last time around. Thank you.

On the provision part, I mean, I think last two quarters we have provided some 20 crores, right, because of the commodity price volatility. So have we provided anything this quarter?

No, we have not provided anything this quarter.

And any kind of reversal that we can expect in coming quarter?

Yeah, I just answered that. You can expect reversals only if commodity prices stabilize. Completely over this quarter, and we see some benefits of green shoots we can see today, and therefore there is no provisioning taken in the current quarter, but we have to give the markets to stabilize sometime, and once we see the stability, we can guide for this reversal for quarter four only, when we meet for quarter three results.

That would be from my take. All the best. All the best. Thank you so much.

Thank you. The next question is from the line of Rahul Kumar from Vaikaria Fund. Please go ahead.

Yeah, hi. Thanks. Just on the guidance for the full year in terms of execution, when you mentioned that 20% growth, you know, we are guiding for FY27. Are you factoring in any disruption for the NCR region?

I just answered. However, for your clearer information, no one can predict what is going to happen this year around with NGT. Last year, we had taken 15-20 days as a shutdown period. All right. However, the first set of details which are coming out, like a complete ban from 5th November to 20th November, itself is taking away 15 days. So last year, it was graph 1, 2, 3, 4. So, complete suspension used to happen in Grab 4. Now, we are still in Grab 2, 3, and the complete suspension has happened. So, we will have to wait and see how it pans out. I am as eager as you to know that, but I will not be able to give a firm number to that. If the disruption is 15 days or so, no issues at all. If it is 20 days, we will still cope up from the other projects. However, if it is 45 days, I cannot give a number to that.

Okay. Okay. I understood. And for let's say 1H, you know, 1,400 crore revenue, how much of that was from, you know, NCR?

I do not have that bifurcation in front of me, but if you put a mail, maybe we can try to answer your question to some level.

Okay. Okay, I'll do that. The second question is more on the margins. I think we have already answered a lot. But would it be fair to say that, let's say the, you know, the commodity prices remain where they are as of now? These are the, you know, the bottom margins which we have seen now, and hopefully they should improve from here on?

So, as I would like to reiterate again that if the commodity price is stabilized and the escalation clauses in the government tender match those increases, then yes, you will see improvement from quarter four. But if the prices of main commodities... Are so volatile that between quarter one and two, you see a gap of 35%, then it is very difficult to give a prediction. However, currently they are stable. There are some downward trends in the main commodity prices. Most of the 100% of the private sector is full pass-through. But in government, it depends on the price variation. Which is derived from the WPI and commodity-based indices. Those have caught up much better in quarter two. If they catch up in quarter three, then yes, in quarter three earnings call, I can give you a firm answer. But if it is not stable, then it will be very difficult to predict something on which I have no control.

Okay, okay. And which are the commodities, you know, where you have seen a higher inflation versus the wholesale price index-led cost inflation?

We have seen higher prices of steel, okay? We have seen higher prices of all electrical items, which have just little bit got corrected because of CPWB circular, and the formulas to bring it down to the current prices. So, these two are the major things which are impacting. The war took the tile prices through the roof by 20%. Escalation has caught up to some extent, but not for the entire increase. When I say increase means, obviously, it increases the cost of production, all right? So, therefore, if the quarter three does the catch-up and matches this increase, In finishing items, electrical items. Electrical items, and so on and so forth. I will be able to give a more clear answer in the next conference room.

So, basically, for the public sector projects, the commodities...

I'm sorry to interrupt, sir. Could you return to the question queue?

This is just a continuation of this question.

You could return, please.

Okay.

Participants, please limit your questions to two questions per participant. We have several participants awaiting their turn. The next question is from the line of Devakar from Prudent Equity. Please go ahead.

Sir, I would like to know the long-term strategy of increasing our margin. Because in last 11 quarter, we have not seen any profit growth. We used to do 18% margin, now we are doing 15%. And this quarter, your depreciation expense has also increased from 2019 to 35. So, what is the long-term strategy to increase this margin and give some profit growth on quarterly basis?

The profit from with respect to last quarter has increased. However, As a strategy, I have just mentioned that the company continues to look at profitable orders, which match our current profit profile or improves upon that. And our order mix clearly substantiates that these orders which have to be executed over the next three and a half, four years period, when superimposed. Do suggest that the margin profile which we have been committing of 15.5 to 16.5 as EBITDA, which again is a market-leading EBITDA level, or the PAT level at the current levels, because we still wait for the commodity prices to stabilize. Once that stability happens, I can give a guidance on the increase. But on an absolute basis, we are well on track. to have a very good growth in the current year and the next financial year so that there is no change in the long-term strategy of the company we will focus on our core strengths we will not digress into new segments of infrastructure building and building construction including factories will be our domain of growth and there will be some geography expansion into tier 2 and tier 3 cities We will be qualified for international projects once we have completed the Maldives, and this is how the strategy of the company, what was taken up in 2024, will continue, and there will be no change in the foreseeable future.

And so on the debt part, I see there is some increase in the debt. How do you see the debt in this financial year and next financial year?

The debt at this level, in spite of the growth, will remain the same. We have invested about 80 crores in CapEx. Majority of which has come through term loans. The repayment per month is approximately 10 crores. So I believe firmly that as on 31st of March, there may be a slight reduction. But we foresee a sizable build-up on the cash position. So, the net debt should fall or be in line with the 31st March 26th numbers. This is what we believe.

And, sir, I would like to know the depreciation expense plan going forward. This quarter, we did around 35 CR. So, given that, you said you will be doing 135 CR KPEX. So, how do you see the depreciation?

Sir, depreciation is directly proportional to the capex, which we do. So, the point is that aluminum foam work, which is a majority of our procurement, is being written off over seven-year period. And maybe with the project execution periods, which was earlier four and a half years, now coming down to three years, this depreciation will only accelerate. So, at the moment, all I can say is it will be at the current level. What is more important for us is to improve the top line. And thereby bring down the fixed cost as a percentage to the top line to improve the profitability, EBITDA, or whatever parameters you are looking at.

Sir, do you have any further questions? No. Thank you. The next question is from the line of Amit from Robo Capital. Please go ahead.

Thank you.

Sir, I just want to reconfirm our FY28 revenue guidance of 4,000 crores. I mean, I've joined the call after a couple of quarters, so I just want to reconfirm that.

Yeah, at the moment, our guidance remains unchanged for FY28 at 4,000 crores.

Right, thanks. And what do you expect the order inflow to be for, you know, like H2 of this year and next year, FI28?

So H2 of the current, we believe that we will cross the targets given for the full year very easily. That's one, the target was given at 4,500 crores as new order inflows. The current order is already booked. And with what we are negotiating in current month and next month, we do believe that we may revise the order inflow chart in the next quarter. The OBIT pipeline is very, very strong, and so we see no reason why a 25% increase in order book should not happen in the next financial year to commence with our top-line guidance.

All right, sir. Thank you.

Thank you. The next question is from the line of Pariksit Gupta from Fair Value Capital. Please go ahead.

Thank you very much for the opportunity. I am relatively new in covering the company, so please pardon my naivety of questions. First question on the public-private share mix. While I do understand that the management's objective is to ensure profitability in cash flows rather than the sponsor, are there any plans of moving toward more private projects in the coming future?

So, we have maintained that a healthy mix will be... Maintained at about 55, 45, 50, 50. It's dynamic. You have another 1,000 crores coming in private sector, it may shift to private sector being 45 and government 45. You may see certain government projects coming in and that may shift again. But ideally, we would like to see government at 55, private sector at 45. This is simply because the government projects are lock-in key. The project values are higher because it's not shell and core like in private sector. So, this mix is what we will try to maintain. What was the second question? That's it? Okay.

No, no, no. I'm sorry. Yeah, the second question is on the promoter pledge. I believe that the management had earlier guided that it would be... It's completed by the end of FY27, so I just wanted to check, has there been any updates on that or any modifications in the earlier guided figures?

No change. We have reduced 35 lakhs of pledged this year. Only 50 lakhs of shares are pledged for the company limit with State Bank of India, project-specific limit. The limit, which was Initially, 608 crores has come down to 140 crores. And therefore, we have given a guidance of 31st March, 2027, and we are working towards it. However, this pledge is not for promoter or anything. It's for the company's working capital limits, which the company is using. And therefore, it can be concluded as a very, very safe pledge, unlike the earlier pledges which were given to NBFCs. Which has all been removed, and the company will not give any pledge in the foreseeable future to any NBFC for working capital limits enjoyed by the company.

Understood, sir. These are very helpful. Thank you very much for the answers. Thank you.

Thank you. The next question is from the line of Tanmay Jain from Daulat Capital. Please go ahead.

Yes, sir. Thank you for the opportunity again. Sir, just two quick questions. Firstly, on the monthly run rate on the NBCC project and the IIT Bombay project.

So, NPCC, we have crossed 60 crores' run rate. However, the NGT impact for November will be there, but notwithstanding that, in the clean period where the NGT impact is not there, we will do about 65 to 70 crores per month.

And for the IIT Bombay?

IIT Bombay, only one location has been handed over of 70 crores against 550 crores. And that's the only thing we can execute at the moment in time. The client is trying their level best to take certain permissions for tree cutting. Once that is there, then the overall run it can be given. However, we do believe that the client should be able to provide the entire frontage by 31st March 27th, and in which case we will have to then complete the project in 24 months, which means that The run rate would be about 60 crores per quarter, excluding escalation.

Yes, do you have any further questions?

Yes, just one last question. Sir, as NBCC is planning for the Gittorini land for the redevelopment project, by any chance are we looking for that opportunity?

See, we continuously keep waiting for CPWD and NBCC in the central government, apart from the other PSUs. So, NBCC... A lot of projects are coming. I do not have a list of the specific one which you mentioned. But then there will be bids going month on month to NBCC. And depending on the geography where we are present, we shall submit our bids. So, for example, there were bids invited for JNK. We refrained because that is not our geography at the moment in time. But yes, we will look at projects in Delhi NCR area, maybe even 150-200 km away from Delhi NCR, and we will be looking at Mumbai MMR area. So, NBCC and CPWD, these are the locations we are focused on.

Okay, sir. And we will be re-weeding for the CPWD for the RBI quarter, right?

Absolutely.

We will be. Okay, sir. Thank you. Thank you so much.

Thank you. The next question is from the line of Rohit Gupta from RKG Online. Please go ahead.

Hello, good morning. Regarding the CIDCO project, the company has had an L1 bidder. Could you please explain why the project about profit is taking so long?

The board meeting has happened and we are given to understand it has been cleared in the board meeting. Hopefully in the next 10 years we should be able to share some good news.

Thank you so much. And so, my next question is, could you please explain the rationale behind appointing four CEOs?

Yeah, absolutely. We believe that including Rahul or other members, no one is a superhuman. The projects are getting more and more complex, and therefore, we have appointed co-CEOs in charge of each BU. We have divided these BUs into four. BU1, BU2, BU3, BU4, and each BU head or CEO has been mandated with a minimum revenue and profit after tax, or what we call in construction parlance as side contribution, quarter on quarter and for the year. So we believe that this structure has given us a better quarter too. And we see no reason why this upward trend will not continue. This was the only reason for having a strategic shift from having a conventional one CEO to four BU heads or CEOs.

Thank you, sir. Thank you for my time.

Thank you. The next question is from the line of Nayant Khotari. Please go ahead.

Hi. Thanks for the opportunity. I would just like to understand how much recovery has been done for the first half from the aging, from the old letters that we had, and what is the expectation at the end of the year, how much we will recover?

So we have been able to get the property registered in our name. We hold 48 crores of properties for sale in H2 of the current financial year, and that is the target. In the first half of the first half, the physical money flow was approximately 5 to 6 crores. However, this will grow manifold in the coming quarter or two. So answering your questions, 48 plus whatever has been recovered, maybe 52 to 54 crores could be the total recovery. Obviously, this is subject to the pricing available for the property is held for sale.

And what will be the final number that we will be getting? So let's say by F528.

So I have given that our 200 crore which was held up or maybe 350 crore in 2020, we have already recovered close to 200 crores. Out of 150 crores, we are holding assets worth 50 crores or thereabouts. That means only 100 crores will be pending subsequent to this collection against which we already are having some properties and we are on the verge of finalizing certain settlement agreements. As and when that happens, we will let you know. But I would like to say that we have been successful in protecting the commercial interest of the company for the monies which were... Stuck and provided for over these so many financial years.

Thank you. Ladies and gentlemen, we take that as the last question. I now hand the conference over to Mr. Rohit Katyal for closing comments.

Thank you all for joining us today and for your continued support and confidence and capacity. We hope we have addressed your queries and provided useful insights into our performance and growth outlook. With a strong order book, Healthy Execution Momentum. And a robust project pipeline, we remain confident about our future perspectives. Should you require any information, please feel to reach out to our Investor Relations team. As we celebrate the festive season, I wish you and your families a very happy Diwali and a prosperous New Year. Thank you once again, and we look forward to connecting with you again next quarter. Have a wonderful day and holiday.

Thank you very much, sir. On behalf of Capacity InfraProjects Limited, that concludes this conference call. Thank you all for joining us, and you may now disconnect your lines. Thank you.