H.G. Infra Engineering Limited (HGINFRA) Q2 2027 Earnings Call Transcript

Ladies and gentlemen, good day and welcome to SG Infrastructure Engineering Limited Q2FI27 Earnings Conference Call hosted by Go India Advisors. As a reminder, all participants' lines will be in listen-only mode and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during this conference call, please signal an operator by pressing star then zero on your touchstone phone. Please note that this conference is being recorded. I now hand over the conference to Ms. Saloni from GoIndia Advisors. Thank you, and over to you, ma'am.

Good afternoon, everybody, and welcome to HG Infra Engineering Limited earnings call to discuss the quarter 2 and first half of FY27 operational and financial performance hosted by GoIndia Advisors. We have on call Mr. Harendra Singh, Chairman and Managing Director, Mr. Vikas Jain, CFO. We must remind you that the discussion on today's call may include certain forward-looking statements and must be therefore moved in conjunction with the risk that the company faces. We now request Mr. Harindra Singh to take us through the company's business outlook and performance, subsequent to which we will open the floor for the Q&A. Thank you and over to you, sir.

Thank you, Saluni. Good evening to everyone. Let me begin by wishing you and your families a very happy Diwali and a prosperous new year ahead. May the coming somewhat bring happiness, success and prosperity to all. India is progressing towards its vision of becoming $7 trillion USD economy by 2030 and $30 trillion USD economy by 2047, and the infrastructure development will play a very critical role in achieving these ambitious targets. With sustained government focus on increasing investment by both public and private sector, the country is witnessing significant opportunities across roads, rails, power, and urban infrastructure. At HG Infra, we believe infrastructure development is not just about building physical assets. It is about connecting people, enabling businesses, and creating opportunities for economic growth. With our presence across 14 states and capabilities spanning roads, rails, metro, renewables, and emerging infrastructure segments, we continue to strengthen our position as a diversified infrastructure company. Let me briefly touch upon the key sector developments and opportunities. The roads and highways remain to be our core business segment, supported by government's sustained focus on highway expansion, improved connectivity and infrastructure development under National Highway Vision 2047. We expect this segment to continue offering meaningful bidding and order info opportunities. The government continues to focus on the rail modernization, capacity expansion, and metro connectivity is creating significant opportunities for us. We are strategically strengthening our presence in this segment through our ongoing rail and metro project and looking into many opportunities as a pipeline. Regarding renewables and green energy, with India's green energy transition, this is opening new avenues beyond solar generation, particularly in transmission infrastructure and energy storage. We see significant long-term opportunities in transmission and distribution, as well as BESS, which are expected to play an important role in strengthening the countries in power infrastructure. Overall, we remain confident about the long-term infrastructure growth story and the opportunities emerging across our focus segments. Our strategy is to leverage our execution capabilities, diversify our business portfolio, and pursue quality projects while maintaining financial discipline and operational efficiency. Later, we will be given a glimpse of our operational highlights. As of September 26, the company's order book stood at 13,685 crores, comprising 8,792 crores from stores, The segment-wise road highway contributes like 64% on railways 21, remaining 15 is from renewables and transmission projects. And the update on the EPC project, as of now, the Ganga Expressway and the UER has been completed, and the completion certificate or UER with effect from 28 February 25 being received on 23 September 26. And very recently, we have received the completion certificate for Ganga Expressway as well. The Jamshitwar elevated road project is progressing well with 70.82% of the progress. The Neen Maga Tumkur project has achieved 73.64% completion and is progressing towards timely completion and likely to be finished by March 27. The DLS project is an at least stage with 6% completion only because of the land-related constraint. The progress is expected to improve in the coming months. The Pune-Shirur project awarded by Wellsman at a cost of 3,931 crore is currently in the mobilization stage with work is expected to pick from quarter 3 for 27 onwards once we are getting the appointed date, which is likely to be there within a month. Regarding the HAMP project, the Kandahal Engloid project has achieved 99% completion, and the companies have already applied the provision completion certificate, which is expected to be there any time, and the COD is targeted in quarter 427. As informed in the previous quarter, the provision completion certificates for Raipur-Vishaka-Pathnam Corridors, OD-5, 6, and AP-1 has been received and also Khambam Devra-Palli packages 1 and 2 already we have received last year. With the COD of these projects is expected in quarter 3 and quarter 4, off to FI-27. Jatin Tirupati-Chanayam project has achieved 71.8% completion and is progressing well with the target to complete by 31st March 27. Varanasi Kolkata Package 13 has achieved 47% financial progress and Package 10 has reached 18.6% completion. The Kosi Parikrama Package 6 Ayodhya has achieved 42.4% completion and its progress as planned. The Narol Sargej project has achieved 54.8% completion and remains on track for timely completion. For the Gobindra Tangi capital ring road projects of Urisa, i.e. the company has signed the contract agreement on 24th April 26th. The land acquisition is at an advanced stage and the appointed date is expected any time within a month. Turning into the progress of railway projects, the DMRC metro projects is 100% completed and just handover process is going on. The Bilaspur-Hemarchal Railway project has achieved 98.3% completion, started for completion in Q3 FY27. The Kanpur Railway Station project has achieved 58.85% completion, though there has been certain delays because of the blocks not available. The company has applied for extension of time, which has been approved in principle for up to December 27. The Dule-Nardana Railway project has achieved 57.6% completion, and the company has applied for the extension of time in this project also, because almost 11km land is not available as of now. The Gaya Sondagar project and Karanjigavar project have achieved 56.2% and 67.2% completion, and there is non-availability of work funds also. In these projects, the company has requested extension of both these projects. The New Delhi Railway Station project initially faced delay due to land clearances. Now it has gradually has picked up with completion is reaching at 18.36%. For Thane Metro project, the appointed date has been declared as 11th January 26. However, this project is facing challenges related to land availability and local social issues also, socio-economic issues. So the authority is working aggressively to resolve these issues. Anupur and Mirzapur are currently in the mobilization phase with 2.43% and 1% completion respectively. Update on solar project has been as of 30th September 26th, the company's solar project reached approximately 96% completion, while heavy monsoon, transmission line, land equation, local disruption has caused execution delays, but these hurdles are now being actively resolved. The company is deploying necessary resources to meet revised contractual timelines to be completed in the next few months only. Financially, 89% of the required project debt is sanctioned and remaining 215-plus crore of balance is selected for release in Q3 and Q4 FY27 following the plan commission. Operationally, the company envoys discounts around 80 crores in this financial year from 141 active plants and is targeting 250 crore plus annual turnover once all the plants are commissioned. Regarding the BEST project, the company has already executed a binding agreement with GUNL and NUUN for three BEST projects. This is around 1,470 MWh. Procurement of long lead items is in place, including BEST and PCS, with a delivery expected by January 27th. Civil works at Banas Kata and Dolera are approximately at 80 and 60% completed, respectively, with the major material already received. For Charania land-related formalities and design activities are progressing and in principle bank and bank sanction has been received. So these three projects are expected to generate annual revenue of approximately 225 crores upon commissioning. So we are expecting that these two projects would be commissioned by March and followed by Charania somewhere in June 27th. So regarding the power transmission project, the company is advancing its power transmission portfolio across Ulissa, Uttar Pradesh, and Jharkhand, where the progress across regulatory approval, engineering procurement, and on-ground execution is started. TSA has been executed for all three projects at Angul, Unisa, Pata or Ayatollabru already has been received, and the foundation work is progressing, and the tower erection is going on very smoothly. At Jamshetpur, Jharkhand, route alignment has been completed, and with the land acquisition underway, also in Virzapur, Uttar Pradesh, land has been identified, the lease agreement with the confirmed authority is under execution. The engineering and procurement activities are progressing across all these projects, and for Angul, we have received the financial closure, and for other projects, financial closure is the target to be at the call center. This is the update regarding five new ham assets which has been monetized. So, during Q2, the company has successfully transferred 51% of its shareholding in ODIFY, receiving partial consideration of 103 crore. The remaining holdback amount are expected to be received during Q3 and Q4 of Q27, subject to achievement of respective commercial CODs and completion of certain purchase items. In Q2 FY27, the company has also received an amount of 92.3 crore rupees against partial release of holdbacks in all four earlier sets. Cumulated, the company has received an total amount of 857.46 crore till September 26. Out at a total consideration, the balance consideration is expected to be received in Q3 and Q4 and subject to final COD and completion of relevant conditions. With respect to 5th HAM assets, Raipur-Vishaka-Patnam AP1, the company has already received the NOC from NHAI and lenders and expect to complete the equity transfer of AP1 project in Q2-27. Regarding equity requirements of all projects, the total equity requirements for all HAM, Transmission, Bess and Solar is around 3050 crore. And as of September 26, 1846 code has been infused in these projects. The remaining equity will be infused in later half of this year and FY28 and FY27. Moving on to the financial highlights of quarter 2 and first half of this year. At stalinol, revenue has reached to 883 crores with an EBITDA of 105 crores and an EBITDA margin of 11.9% with a PAT of Q2 at 32 crores at a margin of 3.6% compared to 67 crores at a margin of 5.8% in Q2 after 26. Revenue for first half FY27 reached 1790 crore with an EBITDA of 182 crore and EBITDA margin of 10.2% and PAT for the first half FY27 stood at 60 crore with a PAT margin of 3.4% compared to 193 crores and the margin of 6.7% in first half FY26. On a standard basis, our gross debt stands at 1595 crores. This comprises 714 crores of working capital debt, 488 crores of NCD, and 482 crores of term loans and current maturities, along with threat limits and other means of debt. With our expected collection from receivable monetization proceeds, we are targeting to close our standard debt at 900 crores by end of this year. Now, regarding the consolidation final share revenue of quarter 2, FY27, which reached to 974 crore with an EBITDA of 250 crores and a EBITDA margin of 25.6%. And PAT for quarter 2, FY27 stood at 80 crore with a PAT margin of 8.2% compared to 52 crore with a margin of 5.7% in quarter 2, FY26. The 24 first-staff FY27 reached 2074 crore with an EBITDA of 553 crore at an EBITDA margin of 26.7%, PAT for first-staff FY27 stood at 35 crore with a PAT margin of 1.7%, as compared to 151 crore at a margin of 6.3% in first-staff FY26. As we are targeting and authoring flow of 10,000 to 11,000 road FY27, with approximately 5,500 roads secured up to quarter to FY27, our growth prospects remain strong across roads, rails, metro, and power transmission, supported by upcoming infrastructure investment and the government's initiatives. We will continue to focus on high-quality projects, disciplined bidding, and timely execution while expanding our presence in emerging infrastructure segment. With the diversified project pipeline and the food and financial management, we are well positioned to drive sustainable growth and deliver long-term value to our stakeholders. I will now hand over our call to our IR advisor and request them to open the floor for Q&A session. Thank you.

Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and 1 on their touchtone telephone. If you wish to remove yourself from the question queue, you may press star and 2. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Vaibhav Shah from JM Financial. Please proceed with your question.

Yeah. On asset monetization, so we have already monetized 100% stake in four assets. So initially we had mentioned that 1384 crore is the equity value. So roughly the gain would be something around 530 crores because the investment is around 850 odd crores. So what would be the tax impact on it and when will we receive that amount in the TNL? Because you are not seeing any major accruals on the TNL side in standalone accounts till now.

Basically, as we have accounted in last two quarters, we have seen that these are the four projects which we already have monetized. So, there is not a gain into equity because the net worth of all those four assets, at least in OD 5 and 6, we have incurred significant loss in that net worth. So, the collection is almost 55, 550 crores of collection is yet to happen out of the four projects, and one project which is yet to be monetized, like AP1. So, this is 550 crores of collection is yet to be there, which is we are expecting quarter three and quarter four.

So, once that collection happens, then what would be the gain which would be booking in the standalone accounts?

The standalone would be around 70 odd crore rupees, which is likely to be there in quarter 3 or rather in quarter 4.

Only 70 crores of gain?

Correct. So, because the consolidation, the gain in consolidation, which as per the net worth number, So if you see the net worth is actually was having that different number and the collection or the amount of concentration. So I can refer you to in detail with our finance team. So they will tell you the entire details.

Okay, okay. So secondly, in terms of the revenue guidance. So what would be the revenue guidance and margin guidance for, uh, FI 27 and, uh, can you throw some light on how the execution is going on in Pune Shiro and what are, are our revenue targets for the same in this and next year?

So as of now, as of the year, these are the two big size projects, one is Pune Chirur and Urisa, the CRR project, and one of the transmission as well as Mirzapur project. So these are all 6,000 crores of projects where the appointed date is likely to be there within a month max by mid of December. So we are expecting in quarter four would all the projects would be there with that revenue and the mobilization already has been done in all these projects. So, we are expecting to be roughly around 6,000-odd crores by end of this year, if you see, and as well as the margin front, there is a significant, now there is a considerable significance, where we are about 11 percent because of the few projects incurred huge losses, and now we would be in a range of 13 to 14 percent of EBITDA, so about quarter three and quarter four and subsequent to this.

Because first half has been only 1,800 crores of revenue. So in second half, we require 0.2 hundred, which is 50% higher than the last year second half. So we are very confident on that front.

So basically all these projects where they appointed it is immediately being expected. So we, in any of the scenario, would be doing some 3,000 or 4,500 to 3,000 crores in quarter Good morning, everyone. So, this is giving that, this is the positive amendment, we are confident enough that we will be able to do that part, because the mobilization has been done in all such projects.

Okay, okay. Thank you for those of my questions.

Thank you. Participants who wish to ask a question may press star and 1 at this time. The next question is from the line of Shravan Shah from Dalat Capital. Please proceed with your question.

Hi, sir. Thank you. A couple of questions. Before that, just one clarification. This order book of 13,700 odd crore, 685 odd crore. So does the unbilled revenue have we removed from this? So I just wanted to say when this will be executed, we will be booking this entire as a revenue or this minus unbilled revenue?

I think the contract asset is a part of execution. The contract asset or the unbuilt revenue is already being executed as far as physical progress is concerned. The financial is, okay, there is only collection which is going to be there. So it would be again, once you build them, then the collection would be there. So it's already been executed. So this is a net of 13,800 odd crore rupees, net of total projects which are yet to be executed as a balanced part.

Okay, so this does not include the unbilled revenue. So to put it in a simple word, whenever we will be executing, let's assume, we will be executing this entirely in next two years. So this number will translate into the revenue, the exact number.

Correct.

Okay, okay, got it.

So now coming back to the what the web has asked, so further to dwell down on that. So if you can specify the segment wise, because the number that we are looking at 4200 crore kind of a revenue, and correct me if I heard wrong, we are looking at 3000 to 3500 crore revenue in the fourth quarter. And if that's the case, then in the third quarter, we are looking at kind of a similar 800, 900 crore kind of a revenue. So just to dwell further, how each segment wise, if you can specify in the second half, how much revenue we are looking at in the ham road EPC, and that obviously the Pune, Sirpur is the major one, then railway, solar, BES, transmission, each segment wise, if you can specify, would give a much more We have more confidence that we can achieve this kind of revenue.

Of course, I think as far as the battery is concerned, they are likely to be commissioned, so with that we are assuming that 350 crores of this would be there in second half of this year, 350 crores, and around 300 crores of transmission revenue, which is likely to be there, so this is around 340 plus 300 crores of transmission. And as far as rail metro is concerned, we are expecting that we will be touching roughly around 1400 or crores of top line in this half of this year. That includes New Delhi, RVNL balance portion which is yet to be built, as well as Gaya project, Arongabad, Dule, Thane metro even just started, small portion has been just picked up. So these and even Kanpur railway station. So these are almost 1400, so look, put together is around 2000 crores. Balance is going to be from all six hams. Five hams are aggressively pushing. We are at a very advanced stage like Charkan Package 10 and 13. Major contribution would be coming from these two projects. This would be roughly around 700-hour codes to be executed in these two projects, Charkan Package 10 and 13. There is a use also which would be executed in that. And even other projects like Narwal and Ayodhya. So these are the three projects of ham, which again would be contributing around 600 Rs. in this particular phase of two quarters. Pune, we are expecting to be there, around 600 Rs. which is likely to be there, which we are going to see that already mobilization being done, utility shifting is at advanced stage. So this project is going to contribute at least 600 for this half of this year. So, put together, along with certain projects like Tumkur is there and Jamsherpur there, the EPC projects, and some small portion which is balanced of HAMP projects which are being monetized. Even in Karnal, small portion is balanced. So, there are around 200 crores. So, it is likely that we would be around, say, doing around 4200 crores of projects like this.

Got it, got it. So, and then, as you said that in the second half, we will be looking at 13-14% kind of a margin, and going forward also, 28, we will be seeing the similar 13-14% kind of a margin. And in terms of the order inflow particularly, so how much we have bidded, and there also just wanted a clarity in terms of particularly on the roadside. Obviously, we will be looking at that. So recently, the UP, many, many projects got canceled, the tender which were there as part of tenders. So just wanted to understand how many projects across the different segments that we have bidded, where BD is yet to open, and how much more we are likely to bid so that we can get an idea that whatever we are looking at, 5,000, 6,000 crores, more inflow in this second up.

So there are other projects also, if you are saying that apart from NHAI, HAM or the VPP projects, there are not many projects, there are around 7000 crores of projects which we already have bidded and the results are yet awaited. Railway around 5000 crores of projects, so if we are seeing that how we are confident that we would be at least looking at 5000 to 6000 crores of new orders to be awarded for the project. So, looking into state like MSRD, he has already, again, invited those projects which were cancelled. So, the invitation is there. NIT has already been floated. Again, the state government, the ISTAN government is going to, RSRDC is going to bid for their two expressways in the next four, five months. NHA is having this pipeline, which is giving us the confidence that even the rail metro, like in metro, we have already bidded two projects. Big size 13 in metro and one in Delhi metro. MWMetro is having a few big-sized projects like 7,000 crores of projects, four or five projects are there. So this looks a mix of opportunity where we are hopefully, and transmission also, that we are quite hopeful that we will be able to just add this number.

Okay, so similar kind of 8-10,000 crore plus kind of inflow, even let's say if we maybe one or two month delay, it would be there by March, maybe April, May. So similar broadly inflow in the FI28 also one can look at so that what previously we are looking at in terms of the 7,000 crore kind of revenue in FI28 can be achieved. It's quite possible. Okay. Okay. Got it, sir. I will come back in two. Thank you and all the best. Thank you.

Thank you. Ladies and gentlemen, to ask a question, please press star and one now. Thank you. The next question is from the line of Harshal Sharma from AS Advisor. Please proceed with your question.

Hello.

Hi, sir.

So can you throw some light on what would be the guidance for the fiscal

and FI 28? As you are discussing that we are targeting that at least with this last one year and this year, we are not having that much of revenue because of slow awarding appointed date delay, but quite hopeful that we would be doing around 7,000 crores in 28.

So, when can we see an obstacle in the order and flow?

The orders are already there, so only a matter of the time which has been there. The land acquisition, the DTR, these are all at NHI and Ministry level. So, we are seeing that the traction is there, but we are quite hopeful in this year, around 300-odd kilometers, likely they are targeting to be awarded. Another project like MSRDC, UPIDA, and even in Rajasthan Strait. So these are the state expressways for roads. For rails, I think some big-sized projects already, the tender is there. So these are all 1,000 to 5,000 cores of projects with trails and new lines like metro also. So the pipeline is a mix of, in all these sectors, it's a mixed pipeline, which we are quite hopeful that we would be able to get.

All right. Thank you. That's it for my sake.

Thank you. Before we take the next question, we would like to remind participants that you may press star and want to ask a question. The next question is from the line of Deepak from Swan Investments. Please proceed with your question.

Thank you for the opportunity. I just wanted to check it out on this sharp increase in the commodity price. If you can throw some light on our energy vertical, one, on the BESA, and secondly, a project which we have got from the month of April onwards, especially last day. How should we see the margin profile in the project? And in the battery, are these changes in... This product crisis or latent crisis, is it a completely pass-through? Does it have a completely pass-through mechanism or how should we look into all these assets?

So, as far as highways are concerned, we have seen the commodity being protected by real-time price escalation for bitumen and crude PUL. For rail projects, there has been a hit, and we have taken that hit is going to be there, which we have seen that not a big number is going to be there, because we are not having many rail projects, which are having OEC and SMT kind of a change. Because in civil work, it is not that impacted. Steel and cement and aggregate is not that big impact is there. For bitumen, it is there. For transmission, BESS has been impacted, but then again, we have taken that the earlier margins in BESS was quite high. Now it has been around 12 percent, which has been now. Earlier it was supposed to be 20 plus because of this dollar and this currency as well as the battery prices. But that has been covered and taken into consideration as of now. The transmission with aluminum and copper is playing where the commodity prices are gone a bit, 30 to 40 percent plus at the number which we have bidded. But then we have taken into our bid consideration the price escalation which is already being covered in our budget. So we are not likely to be hit severely into these commodity increases.

Thank you. Thank you, and wish you all the best, and wish you a happy day.

Thank you. To ask a question, please press star and 1 now. The next question is from the line of Rahul Bhutra from Anandrati. Please proceed with your question.

Yeah, hi, sir. I just wanted to understand, you know, I am saying, you know, interest income is coming up, you know, on account of contract modification. So can you just, you know, give me the color, like what was it about?

Interest income is basically, there are a few projects of Maharashtra where we received 18-year-old rupees that has been booked into other income.

So, sir, is there any revenue apart from the interest income, you know, which flows into our top line? No, no. Due to this contract modification?

No, no, not there. Okay.

And second, sir, I see in this staff, you know, we have invested around 350 crores in contract assets. So, and it has been seen, you know, over the period of time, our contract asset is bulking up. So, what is the reason for that, sir? You know, is there any, you know, slowness in terms of, you know, billing of our, you know, getting the, you know, approval for our billings? Or, and, you know, which segment is causing, you know, for the contract assets to bulking up?

So basically, we have seen that wherever the debtors were there, so we have seen a significant reduction. The debtors at March and now number where the collection is now at a significant pace. But the contractor said significant amount is being struck in railways. Because the milestones and the commissioning, because in those particular projects, there are certain conditions that around 10% of the total amount would be only paid once you commission the entire project and hand over those projects. So now this is a significant amount, around 580 plus rupees into railways. And others do have mix of it, but the HAMP project is again having a significant number, where these projects which we already have monetized and Karnal Ringgold, including Karnal Ringgold even. So, they are the projects where the certain CUS variation items and even in Adani project, Ganga expresses, there is a variation item, which is around 180 ORK rupees from UPIDA already CUS sanctioned has been there, but then there is certain amount of variation which is yet to be approved from Adani. So, there are a mix of these six ham projects, there's around 700 over crore rupees, which we are likely to be collected in quarter three and quarter four. So, this contract asset, which has now been increased significantly, it has gone high to 2100, would be roughly in the range of about, say, 1500 or rather, 200 to 1500 by March. So, 800 over crores of correction is likely to be.

Okay. Got it. Thanks. That's from my side.

Thank you. Participants who wish to ask a question may press star and 1 at this time. The next question is from the line of Shravan Shah from Dollad Capital. Please proceed with your question.

Hi, sir. First, a couple of balance sheet data points. So, this unbilled revenue would be the entire contract asset of 2165 crore would be the unbilled revenue as on September.

Yes, yes.

Okay. Mobilization, retention money, and for HAM, Solar, Ganga, Railway, BES, debtors, if you can specify.

So the mobilization is around 515 crore rupees, and if you are talking about debtors, including retention. So 840 crore is a debtor amount, and 203 crore is retention for all. This is asset part. The stock is around 495 crore rupees. And I think the advances to supply has gone very high because we have booked all this material. And as well as the GST, the balance with authority, this is 288 crore rupees. Cash bank balance is around 163 crore rupees. The trade payables has significantly dropped from 1633 crores and now it is 1188 crores.

Sir, what would be the ham data, solar data, railway data, BESS data?

So, roughly as I explained about the contract asset portfolio, now in HAM, again, SPV solar is around 236 crore rupees, transmission is around 70 crore rupees, and Besson transmission. HAM is, again, it's a significant 500 crore rupees, around in HAM. The rail is a very small portion, and a certain amount is received from Adani, 113 crore rupees.

Okay, okay, got it. And this part of the other income you highlighted that it is for Maharashtra that we have got 18 crore. So from Q3 onwards, the other income will come back to the normal run rate of 3, 4 crore.

We are having certain consolation claims where likely we might get these, but not a very significant amount would be this.

Okay. Okay. And in terms of the capex, so 66 crore we have done in 1H. So in second half, how much more and for next year, how one can look at the capex?

This is the capex. This is the major capex. This is all 4-day projects where we are doing this launchers and other, not very big into investment into equipment, but these are the shutters, etc., which are roughly would be 50 crore, which by the balance part of the year.

And then next year would be a similar 100, 120 crore kind of a capex? Yes. Yes. Okay. Okay. And said this a canal ring road also in terms of monetization, this would also will be done by this March. And how much broadly one can look at in terms of the value, the similar kind of a 1.5 times price to book that way one can look at?

No, no, it's not likely to be by March, because once we receive the PCC, then six months, the cooling period, and we'll be applying for this monetization, say, permission from NHA and banks. It's going to be at least eight to ten months from now. And though we have received the quotation, this offer from two investors, but the number likely would be not that big, because of the price indexing. Thank you. Thank you. Quite that, within the two months we are going to close, we would be able to close this.

Okay, okay. So deal would be done in next two months, but in terms of the cash receipt, you said it would take 8 to 10 months to...

Probably quarter to next year.

Okay, okay, and the five total that we have monetized, so out of 1384 crores, we have received, yet to be received is 550 odd crores that we will be receiving third and fourth quarter, and plus the AP1, so that amount will also be included in the, including everyone, 550 crores. Okay, including the AP1. Okay, okay. Got it. And so just about the date that from 1600 odd crore, we are looking at 900 crore by this March. So in terms of the finance cost, so now 50-51 crore this quarter. So how one can look at the finance cost third, fourth quarter onwards?

No doubt, I think the finance process is because of the very surge in this debt. So, by dropping it to that number, in quarter three and quarter four, roughly, we are expecting that 80% of the financials would be there. Next year, the financials likely will be stabilized at 110 to 110.

Okay. Okay. Okay. Got it, sir. Thank you, and all the best.

Thank you. Before we take the next question, we would like to remind participants that you may press star and want to ask a question. The next question is from the line of Rahul. From Anandrathi, please proceed with your question.

Yeah, thanks, sir, for giving opportunity again. So this contract liability, you know, with which we see is increased by 273 crore. So, can we say that this is a mobilization advance that we received for the Pune Chirur project? Is it the right to understand that?

Yes, that is 170 plus crore rupees for Pune Chirur and one of the project where we received some amount. Okay, got it.

Second, sir, you know, again coming to the contract assets, you know, sir, so can we see this is the peak level and from here on, you know, it will reduce, you know, as we execute, you know, further projects, because what we see, what we are seeing is, you know, even after getting all the, you know, monetization process, you know, maybe even partially, our debt levels are not coming out, you know, it is getting blocked in the working capital. So, you know, how should we see, you know, this is like a peak working capital that we're looking at, and now from here on, you know, it should, you know, start coming down.

So, almost the plateau has been reached in last quarter only. Now, significant drop is likely to be there, be it. Say, if you see the debt part, if you see the contract asset part, where the balance sheet is showing this number, and then the realization by end of this year is going to be significantly reducing the debt because the contract asset is likely to be reduced by almost 700 to 800 crore by year end. Debtor would be in the similar range as we are now, and creditors would be in the similar range as of now.

Okay, got it. And, sir, just last question on the technical part, sir. So, I believe we participated, you know, in all the, you know, packages of the link express of the UPIDR, but somehow, you know, technically, we got disqualified. So, what was that reason, you know, for the technical disqualification?

There were almost five to seven contractors who were disqualified, or the, I think, for a small technical reason, which is probably all missed.

Okay, got it. So, sir, so, you know, are there any, you know, such technical challenges will be there in this MSRDC projects, or, you know, now that, you know, they are being floated?

MSRDC projects, which are invited now, use the same qualification criteria some three years back when we were qualified for that. That is the same project. So, that is only RFP, not RFQ.

Got it. Got it. Yeah, that's it for myself.

Thank you. The next question is from the line of Birbukh Shah from GM Financial. Please proceed with your question.

Sir, when do we expect to receive appointed date for the capital region ring road package 3?

And November end of first week of December. So both for Pune Chirur and this project.

Okay, for the revenue which we are seeing in Punisher, it's roughly around, 130 odd crores in the first half. It is mainly on because of utility shifting and initial work.

It was utility shifting and certain pre-operative expenses, verbalization expenses which were also there while it was, it is a BOQ project basically, so we have splitted that to enable getting the cash flows and billing. So that was a small amount which was also there.

And you are targeting roughly 700 crore revenue for FI27 from Puneh Shiroot.

Quite right.

Okay, thank you.

Thank you. Participants who wish to ask a question may press star and 1 at this time. The next question is from the line of Arpan Gandhi from AJ Capital. Please proceed with your question.

Hi, thanks for the opportunity. I wanted to ask when can we see improvement in margins and when can we see the margins level go to around 15% and above like it was in previous fiscal.

Probably it's the current scenario, it's not looks like because of the geopolitical, the commodity prices, as well as the competition, all across entire infrastructure. We are not very much confident, and we are coming to one to two years is going to be there.

Okay, that's it from our side. Thanks.

Thank you. Ladies and gentlemen, to ask a question, you may press star and var now. Ladies and gentlemen, that was the last question from the participants. I would now like to hand over the conference to management for their closing comments. Thank you and over to you, sir.

Thank you for joining us today. We remain confident in our continued success and are here to address any further questions. Please feel free to reach to us and our IR advisor. Thank you.

Thank you. On behalf of Go India Advisors, that concludes this conference. Thank you for joining us and you may now disconnect your lines. Thank you.