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Earnings call · FY2026 Q4
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Good evening, all. Welcome to HCC's Q4 F526 results announcement. Before we start, some house rules, please. I would request after the presentation, please limit two questions at a time, and you can come back into the queue. From the management, we have our vice chairman and managing director, Mr. Arjun Dhawan, our CFO, Mr. Rahul Shukla, and our chief business officer, Mr. Santosh Rai. With that, I will hand it over to Mr. Shukla. Mr. Shukla, if you can take it over, please.
Yeah, good evening, everyone.
Hi, good evening, everyone. I'm Santosh Rai here, Chief Business Officer, and I'll be taking you through this presentation. Some part of it I'll be taking through, and the remaining part will be taken care of by our CFO, Mr. Rahul Shukla.
Let's begin. There is some technical issue, just, okay.
So, as an organization, HCC completed its 100th year this January, and we are celebrating our centenary year. For the record purpose, we have done more than 4,000 kilometers of highways, 395 kilometers of tunneling, installed more than 60% of nuclear power capacity for the country, and around 26% of hydropower capacity in the country, and we plan to continue to do so. Here are the key performance highlights for Q4 FY26 and FY26. The most noticeable thing is the 142% year on year increase in our standalone net profit to 206 crores in FY26 as compared to 84.9 crores in FY25. And this is largely driven by a lot of, I can say, improvement in the operational methods, operational efficiency, cost discipline into the execution of projects, and trying to focus upon to control the cost despite all the global volatility which we have into the market. We expect to sustain these margins going forward. The next important thing for us to notice is the 38% year-on-year decrease in the debt to 1995 crore, and the full impact is not reflected in this year's result. You will see on a pro forma basis that the annual interest reduction could be to the tune of 112 crore in FY27. We are not done yet. We will continue to focus on completely deleveraging the company and want to further reduce the debt. In fact, the objective is that we become debt-free in some relatively short-term period. That's going to be the effort on the entire organization. On the numbers, standalone turnover is 988.7 crore in Q4 FY26, and for the full year FY26, it is 3937.3 crores, versus 1330.2 crores in Q4 FY25, and 4801.1 crore in FY25. Our standalone EBITDA margins It's 18.2% in Q4 FY26 and 16.1% for the year FY26 versus 31% of Q4 FY25 and 19.4% in FY25. In the Q4 FY26, we have been able to secure 2290 crores of order and a total order intake of 5654 crore for FY26. This includes a 1100 crore LOA we received in April. This was a schedule point of view. It just came in the first week of April. And we are also the lowest bidder for a project on which our value is around 840 crores. In addition to that, we expect that, you know, to get some more orders from the bids what we have already submitted. We have around 26,000 crores of bid under the evaluation, and we are well prepared to submit bids in north of 43,800 crores in Q1 and Q2 FY27. This is the position of order backlog as of 31st March, 2026. Transport continues to be a sector where we have our maximum order backlog, followed by hydropower, then water, then nuclear and buildings. These are the geographical breakup. We continue to have projects across the country. This does not include our 11 crore of LOA, which we have received in April 26, and 11 crore of 840 crore. Some updates on the operational projects. Indoor Metro, what you see on the slide, the FAT, that is the factory acceptance test of the machines, are completed and these machines are on their way to reach the job site. What you see on the right side is an excavation going on for our airport station, which we are planning to finish by December 2027, ahead of schedule, actually. This is Patna Metro, PC05 and PC06. We got this job. Almost five months ago, and all the necessary mobilization activities are in progress, all the GC and everybody's on board. Other preparatory activities are again in progress here. Agarinda Creek Bridge, we continue to drive the piles in the marine environment and on the land also. What you see on the screen here is a floating batching plant that is being used to cast these piers and piles what you are seeing in the water in floating condition. Tehri PSP, the all the four units are commissioned and you can see the picture on the picture the commissioned powerhouse. This is the Bhivupuri pump storage project and this is the excavation works going on for the powerhouse. On Vishnugad people Koti, significant amount of concreting has been done. Nearly 65-70% of the dam concreting is done and we have also completed 9.3 kilometers of Tunneling in the HRT using our TBM. This is the machine hall, unit 1 and unit, almost unit 1 you can see is like 75-80% ready and machine hall unit 3 is under preparation. Tapuan Vishnugar, which is a NTPC project also here, things are progressing well. We are facing challenging geologies, but progress is being maintained as per the required pace. This is the FRFCF Kalpakkam. Block 3 and block 5 and 7 are under progress, and the job is progressing well in line with the schedule, what we have agreed with the department. You know, this being our annual kind of analyst presentation, so we thought we'll also take you through our take on the infrastructure sector and how it is looking like. You will notice that this year we are targeting to have an order booking of around 15,000 crore. That's our guidance for the year. So let me explain you the sectors we are looking at and what's the situation is looking like. We believe that India infrastructure is going to grow at tremendous pace, and this is evident from the kind of plans what the government has and the needs what are there. For example, we are currently operating 1,000 kilometers of metro line, which has to be increased to 20,000 kilometers of elevated tracks. We are having 500, not having, we are in the progress of putting 508 kilometers of high-speed line, which has to be increased to 4,500. Similarly, power, PSP from 7 gigawatt to 1,000 gigawatt. Hydle capacity has to be increased from 50 to nearly 70. Nuclear power from 9 gigawatt to 1,000 gigawatt. So are the numbers here on the screen for your road sector expansion, port capacity expansion from 820 to 10,000 mtpa. And the number of train services, which has to be increased, which will, again, increase the demand for infrastructure related to railway works. So looking at hydropower, we will see that what's the growth is looking like in next 10 years. In FY25, we have around 57 gigawatt installed, and the plan is to take it to almost 167. Which is almost 11% CAGR. In terms of, if I talk the opportunity lakh crores, it will be jumping from 0.5 to 1.9 lakh crores. Lot of hydropower projects are currently in tendering, which we are seeing now, and a lot of focus right now is also on the pump storage projects. I believe the current energy crisis, which is going across the world, will also make the government and the developers. Look at alternatives and PSP is going to stand out in this thing where very long gestation of, you know, readily available power can be made ready as compared to some other modes. So here our advantage is we have built around 27% of Indra's hydropower and we, I think we are one of the few. Top two, three companies, which has the experience in almost all kind of hydropower projects, be it EPC, be it item rate, and have done all elements of that at various projects. These are some of the projects which we can clearly see coming up very soon, almost 40,000 crores of hydropower projects what we have put on the screen here. Similarly, some of the upcoming pump storage projects. So these two together is like almost 70,000 crores of opportunity on the screen, which we are going to be very actively participating into. Transportation, again, as we said, 1,000 kilometers of operational metro has to be taken to 20,000 kilometers, which means that a lot of tier 2 cities will come up with these metro projects. We are seeing a lot of traction into that, Delhi, Patna, Indore, or for that matter, now, Paroda is preparing, Srinagar is preparing for metro projects. Plus, we are going to have these new 7-speed high corridors, which are under preparation. Rapid rail transit system, which are going to be like, you know, connecting two major cities kind of project. This project is also on the table, and a lot of such opportunities are there. We have constructed very similar structures which are required in this kind of project, be it bridges or be it surface works or tunnels. HCC is a company which has been specialist, I can say, in underground metro rail project. We started, the first metro in the country was built by us, followed by Delhi, Chennai, Mumbai, everywhere. And we have done all kind of structures which are required here, so we believe we will be able to participate in a large part of this again. Here is the list of some of the projects which are going to come. You can see nearly one lakh crore of elevated metro projects and nearly 37,000 crores of underground metro projects. Nuclear, I believe this is one sector where we are very, very, you know, uniquely placed because the company has built more than 60% of India's nuclear power plants. We have built the main reactor buildings. We have built plant water intake system. We have built a lot of auxiliary buildings required there. And we are right now also constructing some of the projects which are related to this process. For example, the fast reactor fuel cycle complex, which you saw in the presentation before. So here the important thing is the country wants to take the production of nuclear power from 9 gigawatts to 100 gigawatt by 2047. This is going to be through a mix of different technologies, something like a pressurized heavy water reactor, which is, I can say, a workhorse for the country right now, followed by light water reactors, followed by small modular reactors, also with the SMRs, and this will definitely put together the need of people who are actually, you know, nuclear quality and nuclear Safety trained. And HCC here comes in a very unique position. To show you, you know, what it will look like, here are some of the upcoming opportunities very quickly, which are going to come up. On this slide, you can also see how the different technologies will be contributing to this 100 gigawatt by 2047. PHWR, which is the indigenous program, will continue to be the biggest one, you know, which will be like almost 46%, followed by pressurized water reactors. Also, technology from France, which is like EPR, that project is also coming up in Jaitapur. That will be a part of it. And here are some of the immediate opportunities which we see like Gorakhpur 3 and 4, Kaida 5 and 6, Chutka, My Banswara. And in fact, we are working on some of these opportunities already with these clients. Building an industrial sector, again, I think a lot of expansion is required in steel, copper, and bauxite capacity into the country, which we believe in the next five years can lead to a capex of nearly 3 lakh crores. You'll be happy to know that we have already picked up our one order into the aluminum sector, which is about making the pot shells and pot superstructure, and the job is proceeding very good. This project we got as a result of our... I can say superb performance with the same client 10 years ago, wherein they have been using these structures which are built by us with no complaints, and that led us to be where we are. We will continue to grow in this sector and will continue to acquire more such orders, which are fast turnover, quick turnaround projects, and also they have element of technology which allows us to be a little uniquely placed. So, this sector in steel, copper, and aluminum is where we are going to play. We are also going to selectively look at buildings, you know, which comes up with some big complexes on a very selective basis, but that's a sector also we will keep examining. Thank you. And now I hand over the presentation to our CFO, Mr. Rahul Shukla, for the financials part.
Good evening, everyone. So headline numbers have already been presented by Santosh. So these are just detailing of that. So as you can see, we have this quarter, we have achieved total income of 1016 crores vis-a-vis 950 crore during last quarter. And our EBITDA has been 180 crores vis-a-vis 139 crores during previous quarter. And profit after tax has been 44.6 crore is against us. So, that's where we are. We have reduced our debt very, very considerably, which will be reflected in the coming financial year. Since it has been done during Fag end of this year, you are not seeing much impact of that. But going forward, that will start reflecting in the numbers. On the console side, because now HCC is the main company in the group, your numbers are more or less matching with the standalone. So, we are there at close to 1,017 crore, not much difference from standalone. Habitat stands at 170 crore, which is 17.21%, and profit after taxes 58.9 crore.
So, with this we are closing the presentation and now we are open for question and answer.
Mr. Kapilagarwal, you may go ahead with your question. Please limit it to two questions at a time. Thank you.
Mr. Kapila Agarwal, are you able to hear us? Hello.
Yes, Mr. Agarwal, go ahead, please. Yeah, yeah.
So my first question is regarding that our trade receivable, non-current trade receivable have escalated from 646 crore to 1178 crore. So why such kind of spike is there?
So, these are receivables which when our claim gets converted into awards. So, in this year, we have got significant positive development in terms of receipt of claim to award conversion. That is why you are seeing increase in receivables there, but it's a positive thing to have.
Okay. And on standalone basis, our operating cash flow is approximately 700 crore in this year. So going forward, how we should see it? It will be in this range or more than this only or there is something exceptional in this year?
So our EBITDA, we have been maintaining EBITDA margins of 14-15% mid-teen. And we can expect to be in that range in the long term. Short term, sometimes there may be some increase and then there could be some decrease. But on an average, 14-15% EBITDA we will be maintaining.
Yes, EBITDA I understand, but operating cash flow of 700 CR is a normal cash flow we can say going forward.
Yeah, that's normal cash flow because we have received a lot of our receivables from client which we have stuck. So that's why the cash flow is there. And we can expect these kind of things to keep on coming, but they may not, they may be lumpy in nature. In some quarter, they will be there. In some quarter, they may not be there. But on an average, we are targeting both.
Okay. And in cash flow, we have shown that finance cost, we have paid 979 CR. So this is only the finance cost or some repayment of loan?
So we have prepaid the loans, lender loans this quarter. I got that, but in standalone cash flow statement, finance cost paid is 979 CR. So basically, we have OCDs and NCDs. Our OCD number, when we say there is principal amount and there are some approved coupon amount of historical accruals. So when we pay amount, our principal amount will be small, but the historical coupon accrual will be a larger number. So you will see that debt repayment is some 650 crores, but interest repayment is 900 odd crores, put together 1500 odd crores. So yeah, that's why it is represented like that.
And we have announced that we have transferred some arbitration award of 1900 something CR to our one of subsidiary. So it's not showing any reduction in our balance sheet. So how is this?
So, see, we have transferred those awards at nil value. So there in balance sheet, there was some receivable and there were some liabilities. Both have been transferred to ASS. There will not be any impact in balance sheet.
But in asset side and liability side, both sides, similar kind of reduction should be there. Overall balance sheet side should balance sheet size should be reduced.
So basically what has happened, there are some assets are there and against that we have already received the advances for that. So that is showing as a net of advance in the balance sheets. So there is no change as such in the balance sheet. We are going to transfer both the things to that.
And we are having investment in HCC infrastructure of approximately 1150 CR and it's substantially eroded. We can say net worth is substantially eroded. But why we think that it will be recoverable kind like we have not written of this. So what kind of asset is in this that company that which gives us assurance that this is recoverable or we can say this subsidy is having such value.
So, Mr. Agrawal, I will answer this question, but I will request that since we have a limit of two questions at a time, so that I will come back in queue. Sure, sure. So, there are significant receivables in HCC infrastructure, which we are expecting to realize, right? So, this investment, this investment repayment will happen. Plus, there are significant business prospects because HCC infrastructure has historically We have done very large amount of BOT project developments and we have got capabilities, PQ, all those things. So, naturally, we are aspiring to continue with that business, grow that business. So, those things are in place, intact, and that's how we intend to get this ICD required. Okay, thank you. I will come back in. Thank you.
Mr. Kunal Tokas, you can go in next, please.
Hello, am I clear?
Yes, go ahead, please.
The first question is, the order bookings for FYI 26 have not been what we expected. So I just wanted your revenue guidance for FYI 27. What can we expect to recognize and do it?
So Kunal, generally we avoid giving revenue guidances because our revenue is generally guided by order that we book. Execution has been intact that you have seen, that when there is order, we have been executing well. So, as we intend to ramp up our order booking and growth, you have seen that this year we are targeting 15,000 crores of order intake, which if that happens, we are able to achieve that. We will be at almost 26,000, 27,000 crores kind of order booking by end of FI27. So, once that starts materializing, you will start seeing significant ramp up. However, for immediate year, we avoid giving guidance. So kindly excuse us for that.
Okay, understood. The second question is about your L1 book being at 840 crore for the last two quarters, which used to be multi 1000 crore rupees. So is there a change in how you recognize your L1 book?
Sorry, Kunal, we are having only one L1 position right now, that is for a project in Kashmir, where our share is 840 crore.
Yeah, it has been, you have been showing 840 for the last two quarters, right, Yasman and Q. You are right.
And this order has not been converted yet because government, I think, the department has their own issues to be sorted out within themselves in terms of some, you know, I can say administrative work. And that's what is delaying this conversion.
All right. Okay. Thank you very much, and have a good time.
Thank you.
Mr. Shashi Kant, you can go in next, please.
I just wanted to know about the current scenario after the Shanti bill passes. What is the, you know, ground development in the nuclear front?
So, Mr. Shishikang, look, there is a lot of discussions happening around, you know, the... The discussions right now are largely centered between the authorities and the developers about the kind of preparations which the industry need to be prepared with, and also various rules of licensing, how the government is going to fulfill some of the condition precedents and what condition precedents developer will have to fulfill. So, this discussion is going on, I can say, in a good, positive way. You must have seen reports by Terry, by other bodies, which are highlighting the kind of work which is happening in this direction. And I believe, you know, like any other new approach, this will take six to eight months for things to start getting crystallized. Having said that... That's on the developer side and what kind of power plants could be set under the Shanti Act. But at the same time, there are the other programs which have already been into place like, you know, this MyBhanswara project or RAPP. These projects will keep going to be implemented by MPCIL directly. And we'll have those opportunities.
Okay.
Other than that, look, SMR, BSMR, this discussion is happening, and you could see some of them actually turning on the ground maybe in 18, 20 months, somewhere around that.
So, I mean, what is the, you know, the cycle once the approvals are in place, land acquisitions are in place, and so what is the normal timeline that the reactors takes to build and get off our slides and all?
So, if you go by the record worldwide and also in our country, a reactor which is based upon pressurized heavy water technology or a light water reactor technology, I think the average time till date has been seven to eight years. China, in some cases, I believe, has been, in fact, their first EPR, which was Taishan, has taken quite a lot of time. But some of the other programs, they have been able to do it in six years. So I will say... Once everything is done, we can expect seven years, eight years as an average time. Naturally, when every learning is being put into process, some other regulatory things are further rationalized, these kinds of time cycles may come down to five to six years also.
Okay, one last question. So, what is the, you know, on-ground scenario in the refurbishment of, you know, plants, old plants like we have seen in Tarapur and all? So, what is the scenario in the ground?
Look, I think some of them, I mean, all our plants are not 700 megawatts. Some of them are smaller capacity, and if government plans to do an upgradation of these plants, these are very, very technical things. We are seeing some kind of upgradation, but I think they are on a routine basis. There is not some, you know, I can say, fixed timeline or program to that. It's on a very, very selective basis what each plant will go through.
Thank you, sir. Thank you. Thanks a lot.
Mr. Rajesh Bhandari, you can go in next, please.
Mr. Bhandari. Are you able to hear us, Mr. Bhandari? Hello?
Yes, go ahead, please.
Yeah, yeah, yeah. Sir, what is our present order book?
Around 13,000 crore as of 31st March, 2026.
And what can we expect in next three to five years, the order book and the debt?
Thank you. No, that 11,000 is not there. Sorry, 1100 crore is not there. This year, we are targeting around 15,000 is what we have said as an order intake.
If it is FY2627.
Ha, ji. Which means.
Sorry, go ahead. How much, sir? 15,000. 15,000 this year. And what turnover we are expecting, sir?
See, as Mr. Rahul Shukla has already said, we can't give you exact guidance, but we are looking at a fairly good growth from where we are. You can assume that by the end of FY27, we may be sitting on an order backlog of something like 24 to 27,000 crores. It could be something like that. We have done nearly 4000 crore this year, right? Yes, you can expect, you know, 20-20% kind of growth you will see in turnover in this year.
When will the debt be okay, sir?
This year we have paid almost more than 1500 crores. So our endeavour is to continue to pay prepaid debt and become debt free fairly soon. Which we have already said and we are working in that direction.
We can expect F by 27-28.
Thank you very much. Certainly, we are very, at company level, we are very hopeful, very positive.
But, Deacon, sir, our total execution is 4-4-5-5,000 crore, that is, according to the name of the HCC, it is very low.
So, of course, as we already discussed, we are working towards ramping up that.
Let me
just add a couple of perspectives. I fully agree, and we are definitely at this point in time punching below our weight. I certainly appreciate the patience that all our investors have had with that. One thing that I want to say is that we're very, very particular about our risk management. As far as the pricing of bids are concerned, we are certainly not going to make any compromises there, and execution-wise, as far as safety quality is concerned, there's no compromises there either. Now, as far as basically growth is concerned, I think that these questions have come up. Obviously, we don't give guidance, but we should expect a certain healthy growth from this year onward, starting with fiscal 27 numbers onward. And what you can expect with the operation efficiencies continuing to actually happen, and at the same time, deleveraging happening at the same time, the pad growth and the pad margins, you should see, will actually also substantially basically continue to improve. This year, we've been very particular with regard to costs. We've been very particular with regard to risk management. It's not been an easy year from a comparative intensity perspective. We should expect that some of the pipeline that we have our eye on in the coming months should actually yield some substantial results. So please stay tuned for that. I think that's a very fair expectation. So I think that the only One thing that we can certainly look forward to actually working off a very, very low base is certainly as far as growth is concerned, both of our top line, but even greater for our bottom line should actually be much higher. It's absolutely correct.
Or dividend cup, dividend cup expect, sir.
I hopefully soon. I mean, I think that, you know, the one thing we definitely do want to do is ensure that we have that healthy order book in. We want free cash flow and a substantially healthy balance sheet. The questions have basically come up about debt repayment. I'm expecting and our strategic imperative very, very clearly is that we want the company to be debt free as early as possible. A lot of room for us to basically take some very big decisions regarding growth. I appreciate the suggestion.
Please, please, please, sir. Okay, sir. Thank you, sir. Thank you very much.
Thank you. Namaste.
Bye, sir. Namaskar, sir.
Mr. Abhishek Lika.
You can go in next, please. Mr. Abhishek, are you able to hear us?
Hello.
Yes, go ahead, please. Yes, yes.
Yeah, thank you for the opportunity. And congrats for a good set of stable numbers. One thing that the, I'm also coming on to that interest question. Like, even if we take into account 1995 crores of reducing debt to almost 1995 crores, the effective interest still works out to be 14.4%. So, what concrete steps can still be taken to refinance, at least, so that even if we are not able to reduce it immediately, but it should not get into the bottom line.
I'm sorry, could you just please repeat, we'd like to understand what this 14% number was, please, that you would come up with?
Like 400 crores is the interest that has been for 25-26, and we are expecting 112 crores saving for this year. So that means 288 crores or 19-95 crores of debt portion.
So just, I think we'd like to just, so the accounting standard requires to actually have us report finance charges as reflecting not only interest to lenders, but also interest on client advances. So those are, when we price projects and take them on, those automatically, you know, through over the life of the project get rest. So the number that you're actually thinking about is much, much higher than what the actual number of lender interest services divided by. So that's, I think, number one. We have in our presentation already talked about. In fiscal 27, we intend to prepay further debt. Obviously, we can't tell you precisely what that number is, but you will see a substantial EPS accretion as a result of that further prepayment. We've talked about wanting to deleverage the company completely. Now, we can't tell you precisely when that's going to happen, but certainly, you know, our goal is to actually have that happen in the very, very short to medium term. And so the point that you make on refinancing, I mean, our cost of finance is about 11%. And so we appreciate the fact that there are financing options in the market today that are lower. We are now moving to higher levels of investment grade. And, you know, we have had proposals been made to us, one of which we are actually contemplating right now, that will potentially refinance our current debt, which will then not only reduce the cost of our debt, but ensure that there's greater liquidity in the short term for growth. So, again, I can't see anything more beyond the fact that this is under consideration. And your suggestion actually happens to be quite timely because it is something that we are in the process of considering.
Yeah, thank you. Thank you so much. That's it from my side. Mr. Agarwal, you can go in, please. Yeah.
So, my next question is regarding, are you getting me?
Yes, yes, Mr. Agrawal.
Go ahead. So, in, we have, now we are proposing fresh issue of, we can say, up to 800 CR. So, what will be the, what will be its usage and how we will raise this?
So, Mr. Agrawal, we are taking that enabling approval, but the idea is that we are planning to grow very fast. We are targeting to book 15,000 crores of order. So, when that comes, there can certainly be need of growth capital. So, accordingly, we want to have that enabling approval in our hand in case we have to go. It's not that we are immediately going and doing that, but we will take a call according to our requirement.
Okay. And we have given some like likelihood that in by end of FY27, we will be having order book of more than 20,000. We can say 22 to 25,000 crore. So what about 28 we are expecting? It can be further this kind of jump or we can say normal growth?
No, our thrust would be to, you know, continue this momentum.
So, like, we can expect if something, everything will be in line, then it can be 40 to 50,000 raised by March 28th.
I think we are reluctant to put the numbers there, but I think the Kager, long-term Kager in terms of order backlog and revenue growth should be, you know, I think considering our low base should be about 20-25% in the long term.
Okay, thank you.
That's it from my side.
Mr. Tokas, you can go ahead, please.
Yes, please go ahead. Okay. Just one quick question.
In your balance sheet, we have a lying item called loans under non-current asset, which has moved up from around 250 to 600 crores. Does that reflect the amount extended to PRBN? That's correct.
Okay.
So you remember our contingent liability had come down substantially during the year with regard to that PRPL loan. It belongs to that. And this is ICD that we have infused. So at some point in time, we expect to get it back along with interest.
Okay. Got it. Thank you. Mr. Rajeev, you can go in next, please.
Yeah. Hi. So I've seen that you have taken an enabling provision of 800 crore fundraise. So what is the purpose of this? And like, what is the mode is going to be like a QIP or a rights or what?
So, we have not yet decided. We are keeping it open, and I just answered a question with regard to that. So, we will come back whenever that mode and all is decided.
But, you know, just to be very precise, if we do go down this path, it will be a rights issue. Which will benefit the existing shareholder base. And as far as we're concerned, the promoter group will be entirely basically supportive of, including potentially look to increase their stake. So as Rahul has said, the goal is to actually sync that along with our plans for high growth, as well as basically a complete deleveraging of the company.
No, but will it be planned in the near term, like in the quarter or two, or like it's at the end of the year?
You know, I'm sorry, but it would be quite unfair for us to answer that question. I think that we would do that at the appropriate time, taking into account all the various considerations.
Because if I see, like, the company has raised around 2,000 crores over the last one and a half, two years, and, like, the price has kept on reducing, like, first you all raised at 32, then at 16, 15 rupees. So, I mean, like, what is the, like, the current situation doesn't make sense to raise money given that you have repaid the debt.
I mean, we can't comment any further to what you said. I think that the entire point is for us to generate value for shareholders. I think that's fundamental. And, you know, the return on equity considerations that we have as far as the medium to long term is concerned are fundamentally, are basically the most important considerations. Um, I think that we will keep you informed and, and, and hopefully you will be clearly convinced once we actually have the plan before you in terms of what we, what we intend Okay.
And the last question is regarding the amount of claims which are pending.
Claims are pending. So are you, I do we, I'm not, let me just, I'm not sure, CFO, do we share the, that information in terms of,
we don't, we don't share all that information. So we would like to reserve it to us whenever there is some more conversion in award and all that can be discussed.
You know, one thing that we will say is that, you know, that's something that we're fairly conservative about as far as our accounting is concerned. The projects that we actually execute by nature have delays associated with them. And these are not delays associated with simple things like land and right of way, where HCC is involved in heavily complex works, many underground works, which are due to Due to uncertainty, prone to delays that our clients entirely acknowledge. And as a result of that, you generally see contract values increase. And as is basically clearly contractually required, there will be amounts that then get paid as a result of those delays. Many of those amounts tend to actually end up getting paid towards the end of the contract, mid to end of the contract, or when substantial milestones have been completed. And so you can expect, I mean, if you've seen HCC's track record in this particular regard, you can expect a similar track record to continue. I think that would be fair to say. One thing I will basically qualify, I'll qualify that remark. I think that considering HCC's pedigree and the fact that it's been part of HCC's infrastructure expansion all the way from, you know, besides 100 years, but in the last basically 20, 30 years, we've seen the infrastructure program really basically escalate. In the last 10 to 15 years, the government has been much, much more responsible about the kind of projects it's bringing to market with the preparation that it has in its DPRs, the clearances that it has in place. And so you would expect that in the more recent projects, projects would actually be less delayed than they were before. And you would expect the percentage of claims as a percentage of the, or the amount of claims as a percentage of the total project cost to also come down as a result of. And then finally, basically, it depends on the client mix as well, right? I think that in certain, in certain kinds of projects, you generally have delays, which lead to kind of additional payments and other projects you don't.
Oh, OK, that's it.
Mr. Saurabh, you can go in next, please.
Yeah, thank you.
Yeah.
So, Mr. Arjun, I do acknowledge that there's a lot of work happening at the company side, and we have a lot of hopes coming through. The point that you just confirmed that the fundraiser would be through the rights issue. I have little bit of concern there. In the last four to five years, you have done two rights issues, and this would be the third right issue. So every time shareholders are kind of forced to apply for rights issues so that their value is not diluted, but again, as one of the other speakers said, the share price is not commensurate to the kind of investments we are having to make in the company. So, what is your comment on that, and what is the ray of light that we should wait for?
I mean, it's a fair comment. You know, I think that the last rights issue was the last large one, because we had clearly placed at the fore the strategic imperative to substantially deleverage the company, ensure that we are the highest grade of investment rating. That puts us in the position of having our facilities be at the lowest cost of capital, and then allows us to kind of expand, you know, for growth, right? Right. And and as far as basically the going forward is concerned, I think that it's a it's a it's a where. We're in a much, much better position to address the market opportunity. And I think that as far as the rights issue is concerned, it's certainly not a done deal. I think that it's an enabling provision that Rahul has taken. And perhaps maybe what we should have done was actually not taken at all and actually come to the board at the time that it was required. But we decided to do so simply because there's a material expectation of some very, very substantial orders and opportunities, including a potential BOT opportunity. And these are extremely sort of high IRR, basically, opportunities before us. So if those opportunities were to materialize, we needed to actually be flexible. But I do take your point. And as far as the equity raise is concerned, the feedback that we have received in the past is that... Generally, rather than actually do a QIP or raise equity in another fashion, given the shareholder base, we've actually had many shareholders benefit from an oversubscription or getting additional basically shares as part of the rights issue. And it has also basically synced promoter incentive and interest along with what our goals is, right? But your point is taken. And I think as far as we're concerned, if we do not need to raise equity, certainly this year to achieve our goals, we will certainly basically avoid doing so. Because for me personally, you know, equity rate of return is much, much higher. It's the highest as far as we're concerned.
Sure. Thank you.
And just to affirm that if it's done for a major, major opportunity, we would be there with you.
I really appreciate your support. And I deeply appreciate the fact that our investors and shareholders like yourself have been patient with regard to what we need to execute. Look, as far as this past year is concerned, or the past year and a half is concerned, the easiest thing for us is to take a job at a price that is not meaningful. But as far as the integrity of our process is concerned and how we think about our responsibility to our clients and to our shareholders and to our stakeholders, that is not something that we will indulge in. But that said, we do need to deliver on the promise of that growth. And frankly, at some stage, a substantial repayment to shareholders for their patients, which includes, you know, starting to actually pay dividends. So, we take this responsibility very seriously, and I think that there's always scope for improvement in terms of what we can be doing better, and certainly we will strive to actually have a much stronger year. So, we've had many achievements this year we're very, very proud of. I think that we're happy with our results, but certainly I think from a growth standpoint, next year we will certainly basically hit all the boxes is my expectation.
Thanks. Thanks for maintaining that discipline. And one last request, if you could do that, I think you need to have more analyst events and have, you know, a better perception of the company. I could see some of the reports coming on the nuclear sector, projecting company on the pivotal position. A little bit more of PR, I think, would help improve the overall sentiment.
Thank you. We take the suggestion very seriously, and we will act on it.
Mr. Pranav, you can go in next, please.
Hello. Hi, am I audible? Yes. Hi, sir. Sir, I just had one question. You earlier commented saying that we are contemplating on a certain funding that we have an opportunity towards us. If we have that opportunity, why do we need the rights issue then?
I don't think that we need to comment any further, Pranam. I mean, it's not, it would be inappropriate for us to get into the details of that. I mean, certainly opportunities that generate high returns require investment, require, you know, working capital and require, frankly, a cushion and contingency, right? I mean, I think that the kind of size of company that we need to be requires to actually have at least that cushion in place. It doesn't mean that there will be a continual increase in fundraising as a function of further jobs, basically, and opportunities coming in. But at least that certain cushion and that certain base needs to be there for us to really avail of, I think, some very, very scalable opportunities. I can't put any further detail on that. I think at the appropriate time, and I think that we're, I think that this enabling resolution has actually raised more questions than we expected. I, to be very honest, I think that we might have made perhaps an error to actually have taken this board approval as a contingency. Please treat that as a contingency. And at this point in time, Um, when we have something material to basically talk about and it will certainly be positive as far as we're concerned, we will come back.
Okay. Okay. Okay. So that was the only question I had. Thank you so much and all the best.
Thank you very much.
Mr. Shashikant, you can go ahead next.
Yeah, thank you for giving me the opportunity again. So, actually, currently, our order book nuclear is just 3%. So, how do we see in coming five years this change? I mean, how much percentage of the order book it can go to?
So, Mr. Shishika, look, our, this position is low right now because the projects which we are doing, two major jobs which we are doing are already completed. And the FRFCF job which we are also doing is nearing completion now, almost 70% done. So, the point is, how will increases because these opportunities which used to come, you know, like once in two years or something are going to. And we expect a lot of traction in this sector because of the private developers and as well as the government.
You know, I'll just add a way, you know, traditionally the nuclear... The order backlog percentage as a percentage of the total has been relatively small. You know, it's been something that we've been tremendously proud of. We've been 14 of the 24 reactors in the country on the civil side. But it's been less than 5%, Satoshi, if I'm correct. And I said certainly what we can expect as the nuclear program scales up and the lack of capacity in this space to execute these complex projects and the qualifications that HCC has, when this program does basically take off and generate real orders and revenue, I certainly think that there's a huge opportunity for HCC to really, It's nuclear business such that it will actually be akin to the transport and hydro and water spaces that we've actually traditionally have occupied about 90% of our auto back.
Okay, sir. So, what is the average, if we take 700 megawatt plant, so what is the average order size that we normally see for HCC?
Look, traditionally, the procurement mode was very different. These orders would be in the size of, you can say, I'm saying in terms of present value, could be like 2,000 crore. But, but, but now since the mode has changed, now the mode has changed and these are going to be called on nuclear island mega EPC packages. That's what they called as an NIMEP. These packages are in the north of 12 to 14,000 crore.
Okay.
Yeah.
Thank you, sir. Thanks a lot. That's all. Thank you. Best of luck.
Thank you. Mr. Lika. Please go ahead with your question.
Yeah, thank you for the opportunity again. My take is like commodity prices are rising as a result because of the worst scenario. How effective are escalation clauses in protecting FCC's profitability?
So I think we have, look, I can say appropriately placed escalation mechanism into these contracts and also our procurement strategies. Have been such that we have been able to hold on to some of the prizes, what we have negotiated and everything. That's reflected in our results, too. Largely, I will say the escalation formulas are made in such a manner that we are able to absorb some of the shocks.
You know, I will not, you know, the, the, I would say that It's not a major area of risk or concern for us. I think that, and the clients that we have, as far as HCC is concerned, are top quality clients with very, very deep pockets. They tend not to be certain clients at the state level that have very, very poor resource constraints or have payment issues. And I think that the quality of client also basically, I think, allows for a very, very fair and amicable and swift discussion as far as payments are concerned. So, in fact, with some of the difficulties that we're seeing globally, and India is actually also facing these headwinds, I think macroeconomically, the challenges that we might actually face from an inflationary perspective, you might actually see in some cases that HCC would, through its escalation formulas, actually have an efficiency rather than a risk. You know, to some extent, we're, as a sector, a nicer alternative to some of the other sectors that are actually probably more effective. In that sense, I think that we're thankful.
I think fortunately we're not building enough blacktop roads.
We are not doing that. So we're not, exactly. So I think that if we were doing, if we had exposure to huge amounts of bitumen requirement, where there's direct correlation with prices of crude, I think that we would have a concern. But look, I think that the inflationary expectations that would probably, that may creep in if this conflict continues, We'll have really effect the price of everything ultimately. But I think that that's where the quality of our contracts and the quality of our clients do matter. And to some extent, I believe that the heavy civil space, especially the kind of projects we do is allegedly well insulated from other sectors in the market.
Yeah, thank you for the elaborate answer. And one suggestion, if I may, can we have an analyst day wherein we probably give a next three to five years kind of horizon where we want HCC to be?
Yes, I think, you know, one thing that I have not completed my commitment on, and I have to apologize to everyone, we've talked about this last year, where we decided that at least once a year or during the fiscal year end, that we will actually have a meeting in person. And so certainly what we will do, because HCC is actually in the process of finalizing its three to five year plan and its business strategy, and that is something that we're extremely excited about. So I think in the coming months, once that is finalized, we will organize an analyst day. Maybe we'll have it coincide with one of our quarterlies, and you can expect that we will actually have a clear presentation at some point late in this calendar year to the entire community to give you a sense of what our direction is for the next three to five.
Yeah, that would be great, because India at this stage would require not many L&Ds and not many bails, and HCC deserves its roaring loin to be back.
We deeply appreciate your support. Thank you.
Thank you.
Mr. Bhandari, please go ahead with your question.
I think Shavik, it is just that his hand is there. Yeah, he has asked his questions.
Okay, with that, I think we have taken all the questions. No more questions. Thank you for your time.
Yeah, I just want to just again, thank you for your support. It's the end of the fiscal year. It has been a very momentous time for us because HCC celebrated 100 years of its service to the nation. And as far as we are concerned, we're blessed, you know, with the support that we have from all of our stakeholders, including our investors and our shareholders. So thank you very much for your support.
17:04 to 1:01:28 · One card per analyst, follow-ups included. Each plays from its start, and the one being answered is marked.
So my first question is regarding that our trade receivable, non-current trade receivable have escalated from 646 crore to 1178 crore. So why such kind of spike is there?
Rahul Shukla: So, these are receivables which when our claim gets converted into awards. So, in this year, we have got significant positive development in terms of receipt of claim to award conversion. That is why you are seeing increase in receivables there, but it's a…
The first question is, the order bookings for FYI 26 have not been what we expected. So I just wanted your revenue guidance for FYI 27. What can we expect to recognize and do it?
Rahul Shukla: So Kunal, generally we avoid giving revenue guidances because our revenue is generally guided by order that we book. Execution has been intact that you have seen, that when there is order, we have been executing well. So, as we intend to ramp up our order…
Also speaking: Santosh Rai
I just wanted to know about the current scenario after the Shanti bill passes. What is the, you know, ground development in the nuclear front?
Santosh Rai: So, Mr. Shishikang, look, there is a lot of discussions happening around, you know, the... The discussions right now are largely centered between the authorities and the developers about the kind of preparations which the industry need to be prepared with, and…
Yeah, yeah, yeah. Sir, what is our present order book?
Santosh Rai: Around 13,000 crore as of 31st March, 2026.
Also speaking: Rahul Shukla, Arjun Dhawan
Hello.
Yeah, thank you for the opportunity. And congrats for a good set of stable numbers. One thing that the, I'm also coming on to that interest question. Like, even if we take into account 1995 crores of reducing debt to almost 1995 crores, the effective interest still works out to be 14.4%. So, what concrete steps can…
Arjun Dhawan: I'm sorry, could you just please repeat, we'd like to understand what this 14% number was, please, that you would come up with?
So, my next question is regarding, are you getting me?
Rahul Shukla: So, Mr. Agrawal, we are taking that enabling approval, but the idea is that we are planning to grow very fast. We are targeting to book 15,000 crores of order. So, when that comes, there can certainly be need of growth capital. So, accordingly, we want to have…
Also speaking: Santosh Rai, Arjun Dhawan
Mr. Tokas, you can go ahead, please.
Rahul Shukla: So you remember our contingent liability had come down substantially during the year with regard to that PRPL loan. It belongs to that. And this is ICD that we have infused. So at some point in time, we expect to get it back along with interest.
Yeah. Hi. So I've seen that you have taken an enabling provision of 800 crore fundraise. So what is the purpose of this? And like, what is the mode is going to be like a QIP or a rights or what?
Rahul Shukla: So, we have not yet decided. We are keeping it open, and I just answered a question with regard to that. So, we will come back whenever that mode and all is decided.
Also speaking: Arjun Dhawan
Yeah, thank you.
Arjun Dhawan: I mean, it's a fair comment. You know, I think that the last rights issue was the last large one, because we had clearly placed at the fore the strategic imperative to substantially deleverage the company, ensure that we are the highest grade of investment…
Hello. Hi, am I audible? Yes. Hi, sir. Sir, I just had one question. You earlier commented saying that we are contemplating on a certain funding that we have an opportunity towards us. If we have that opportunity, why do we need the rights issue then?
Arjun Dhawan: I don't think that we need to comment any further, Pranam. I mean, it's not, it would be inappropriate for us to get into the details of that. I mean, certainly opportunities that generate high returns require investment, require, you know, working capital and…
Yeah, thank you for giving me the opportunity again. So, actually, currently, our order book nuclear is just 3%. So, how do we see in coming five years this change? I mean, how much percentage of the order book it can go to?
Santosh Rai: So, Mr. Shishika, look, our, this position is low right now because the projects which we are doing, two major jobs which we are doing are already completed. And the FRFCF job which we are also doing is nearing completion now, almost 70% done. So, the point…
Also speaking: Arjun Dhawan
Yeah, thank you for the opportunity again. My take is like commodity prices are rising as a result because of the worst scenario. How effective are escalation clauses in protecting FCC's profitability?
Santosh Rai: So I think we have, look, I can say appropriately placed escalation mechanism into these contracts and also our procurement strategies. Have been such that we have been able to hold on to some of the prizes, what we have negotiated and everything. That's…
Also speaking: Arjun Dhawan
Mr. Bhandari, please go ahead with your question.
Arjun Dhawan: Yeah, I just want to just again, thank you for your support. It's the end of the fiscal year. It has been a very momentous time for us because HCC celebrated 100 years of its service to the nation. And as far as we are concerned, we're blessed, you know, with…
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