Jash Engineering Limited (JASH) Q4 2026 Earnings Call Transcript

Good evening, everyone.

I am Siddesh Chawan from Ernst & Young, and I would like to welcome you to the Josh Engineering Q4FA26 Earnings Conference Call. To ensure a seamless experience, all participants are requested to remain on mute during the management opening remarks. There will be a dedicated Q&A session at the end of the presentation. If you wish to ask a question during the Q&A, please select the Raise Hand option under the Reaction tab of the Zoom application. We will call out your name and then request you to unmute yourself to ask a question. While asking, please begin with your name and your organization. Please note that this conference is being recorded. The recording will be made available on the website within a day and the transcript of the call shall be made available subsequently. To take us to the results and answer your questions today, we have the top management of Just Engineering Limited, represented by Mr. Pratik Patel, Chairman and Managing Director, and Mr. Dharmendra Jain, Chief Financial Officer. Now, I would like to draw your attention to the safe harbor related to the today's earnings call. Comments made during the call may contain forward-looking statements that may involve known or unknown risks, uncertainties, and other factors. It must be viewed in conjunction with our business risk that could cause future result performance or achievements to differ significantly from what it is expressed or implied by such forward-looking statements. After the end of the call, if you need any further information or clarification, please do get in touch with me. With that said, I will now hand over the call to Mr. Pratik Patel. Over to you, sir.

Good afternoon, everyone. Thanks for attending this call of Just Engineering Ltd. We will present the figures for the year, last financial year. Today, we have already uploaded on the stock exchange this presentation, which we are going to run now. I would like to start with a brief overview and the message regarding the year on record. As you can see, we have done a consolidated income of 7.57 crore over last year income of 7.46 crore. It is, according to me, quite disappointing as far as growth in revenue is concerned. However, we were helpless in this situation because it was on account of, in the beginning, it was on account of the tariff, which was increased in January to 25 percent and then in June to 50 percent. And that really affected our thinking and strategy in the US because we were not sure as to where these tariff increases will go and stop. And as a result of that, we had slowed down on production for U.S. orders until some clarity had come. Later on in the year, there was this war in Middle East, which ensured that no delivery of projects done in Middle East could be done. It not only affected delivery in Middle East, but it also affected dispatches to Far East as well as Southeast Asia because of sudden unavailability of ships and containers. As a result of both of these two, our growth was affected last year. However, the very good point was that in the domestic business, we did excellently well, we had a growth of 18% in domestic business, and this somehow made the shortfall of close to 50-60 crore, which we had in the export business. The point which I would like to make here is that this domestic business was done at relatively good profitability because of which our stand-alone Profit after tax has fallen only by 1%, that is from 14.38% to 13.38%, which shows that this company is not only reliant on export business, but it is also the domestic business which is so strong that the drop in pet is not more, in spite of a lot of export business which has gone away, And in spite of growth, which was not there. To sum it up, I would say the U.S. tariff situation is quite stable now. We are not worried, I would like to reinforce once again, we are not worried about the percentage of tariff. We are worried about the variation in the percentage of tariff. If it is 50%, we are happy with that 50%. However, it should continue at that. Variation results into our estimating at lower tariff and then when the higher tariff comes into play, it results into losses for us. We are not affected by tariff. If the tariff situation remains stable, we are quite okay with our business in US. Similarly, we hope that the Middle East war is coming to an end soon. And if all this works out as expected, then we are quite optimistic about FY income. Our order book is at 899 crore as on 1st May. We have already achieved revenue of around 40-45 crore till now. So looking to that, out of 940 or 950 crores, to project 875 crore for the current year revenue is not something which is highly optimistic. It is possible. And if we are able to do 875 crore, then our profit guidance would be in the range of 12 to 13 percent. Here also I am conservative because the raw material prices are increasing, and so I would not like to be very optimistic on the profit guidance. But 12 to 13 percent is quite conservative and is easily possible.

Next.

Good morning, everyone.

Thank you.

This slide shows the way we have been growing over the years. This year we are at 757 crore. I said next year we are projecting growing to 875 crore. However, our five-year plan is to double the revenue from 757 crore to upwards of 500 crore. Coming to our financial snapshot of the year, our total revenue has only grown by 1%. The gross profit margin has grown also marginally. The reason for that growth was our depreciation of rupee to a great extent. On the EBITDA level, because there has been no growth, it has come down. Our profit before tax and profit after tax has also come down and that is one of the reason was no growth in the year. Whenever there is growth lesser than 3 or 4 percent, in a company like us, overheads always grow 7 to 10 percent annually. And when the growth is less than 7 to 10 percent, we will see that or observe that the profit. After tax and before tax comes down, and that is what has happened with us this year. Next, on the standalone basis, you can see that in the financial year 26, total revenue of just engineering has come down, however, this is because of export business going down. The domestic business, as I said earlier, has gone up by 18% year on year, and that has been a very credible performance on the domestic business front, and that also was done with good margin of profit. The biggest hit was at Rotony Hunt. We, in the first few months, we were not clear what to do. However, finally, we had gone ahead and started executing projects. December, October, November, December, we have started taking orders also in America. As a result of that, we have a quite healthy order book position now, and whatever shortfall we had met last year, we will more than make up in this year. The profit has also come down because the revenue has come down. However, the same we hope to reverse in this year. In case of waterfront, we have had a minor increase in revenue, and... Reduction in losses. However, Waterfront also this year, as you can see in the slides to come, we are expecting to double the revenue. So all the three companies, Rodney Hunt, Josh, and Waterfront, which are the major revenue generating companies, all the three companies in this financial year, current financial year, will show enhanced growth as well as outstanding profit after tax. Thank you. Thank you. As can be seen about revenue composition, the revenue composition is quite heavy on the water control case sites, which is still our biggest business. Screens and walls are number two and number three, and all balanced equipments and hydropower and pumping, etc., is around 8%. This product contribution is quite balanced, I would say, even though the gates are dominant, but this is quite balanced and this ensures that we are not over dependent on gates to a great extent. Our market share worldwide also is good. We have 44% business in India, 44 and a half, and all around 55 and so percent is out of India. This market share keeps on varying, but the good part is that business outside India is more than business in India. When we come to order book, as on 1st May, our order book is 899 crores. And this along with what we have already achieved till 1st May, will ensure that the projected target of 875 crores can easily be met. This shows the breakup of consolidated order book. Of 899 crore. Our orders outside India in 899 is 627 crore. Orders within India is 272 crore. And this year we don't see any turmoil as such. And so it should be easier for us to execute and achieve 875 crore order book. All the companies are doing good as far as order book is concerned. You can see... Routney Hunt is quite strong, the order book is close to 38-39 million dollars, the Mahamashinyanbu also is strong, waterfront order book as of now is more than the turnover, nearly 3 million dollars, 3 million pound is the order book, which was what we had achieved this year as the revenue. Just Process Equipment, also Vestek, which earlier was Vestek, is at 32 crore. So I would say all the performing companies of the group have stable and good order book position as of date. Our order pipeline also is good. We have already negotiated orders worth 28 crores and further orders worth 80 crores are under negotiation which we expect to negotiate within next few weeks. As pointed out before, we have kept a consolidated sales projection of 875 crore. I told before, we have 899 crore order in hand and around 45 crore worth of billing we have already done. Hence, achieving 875 should not be a problem. Waterfront fluid controls at 60 crore would be close to 75 to 85 percent of what we achieved last year. Same in case of Rodney Hunt, it is more than 25% what we achieved last year. We have been conservative on showing the growth at 530 crore, but that also is easily possible. So I am quite optimistic about meeting the projections given by us and achieving the type of patch percentage which we have given in the guidance. This shows quarter-wise and financial-year-wise income statement. As you can see, our last quarter, FY26Q4 was quite outstanding. One of the reasons, as I said, was also that we could improve our gross margin because of high gain in foreign currency because of what we had estimated during quoting and when we built what The rate at which we built gear was a lot of gain. This is the consolidated balance sheet. Next. I am glad to inform that the acquisition of Penstock UK is finally completed in early April. We have now taken over the company and we would merge the operation of Penstock UK with waterfront fluid controls. We are putting in the right team in place at both the companies to ensure that these companies' combined revenue grows to close to 125 to 135 crore in three to four years' time. Thank you. Some of the new products which we made in this year were the dual leaf gate, which is shown here, as well as the big isolation gate for Bombay project. We also did quite a few good projects like the Blanchard-Chant hydroelectric station for Minnesota Power Company in the U.S., also for Banken treatment plant, the Travelling Bench screens were supplied by us, and the 235 kilowatt Arkemden screw turbines to be supplied near Pune in Maharashtra. One of the most prestigious jobs which we are currently doing is the project in Chennai, which is a desalination plant done by Vietek. We are supplying more than 35 crore worth of equipment in this project. Similarly, most of the Bombay projects we are doing, where we supplied large size knife gate valve for the Ghatkopar treatment plant. And same we are doing in Saudi Arabia for the Al-Hair Seba treatment plant, we are supplying our gate screens, knife gate valves and all the products for this project also. With this, I will like to bring an end to my presentation and take all the questions that you have.

Thank you. We will now begin the question and answer session. Gentle reminder to all the participants, to ask a question, please select the raise hand option under the reaction tab of the Zoom application. We will now wait for a moment until the question queue assembles. We'll take a first question from Ankur Agarwal. Please go ahead.

Oh, hello, sir. Am I audio?

Yes.

Yeah. Thank you for being so candid and saying about saying that this was a tough year. So, sir, my first question is, in PPT, we are saying India business was 44.5% of last year. So that comes to 327 odd crore. And in FY2, next year, we're expecting 320 odd. So like, are we expecting a flat domestic side business for the coming year?

You see, we are focusing more on export. We are not saying that we will not do. We already have good order book position. But when we are giving the projections, we are balancing out export business and domestic business. So as if you had seen the last years also, we had enough opportunity in the domestic front which Choose the business which we want to do in the domestic front, we would like to do business with higher potential of profit, and so we have presently balanced out. However, while during the execution in the year, if we see that there has been some drop on the export front, then we will take over more and more domestic business and execute them.

Actually, I was asking this, sir, because you said domestic was a better margin for this year. So what is our margin?

Domestic is generally a better margin because we do not take orders with low margin in the domestic front. However, the export margin is more than domestic margin. It is proven. What I wanted to reinforce in my statement earlier was that our profitability will not come down drastically if we are doing more domestic jobs.

Got it, sir. Sir, next question is on this, we update this monthly volume data, monthly order book data on BSC. So I was looking at order book. It was 899 at the end of April and it was 827 at the end of March. So like 72 odd crore of increase in order book. And we also said that order book, we got 72 odd crore new order this year. So does that mean April was like zero revenue booked in, or am I reading it wrong?

No, I don't think we have mentioned the volume of order booked in that letter in April also.

Yes, sir. You mentioned 72 odd crore increase in order and our total order book also increased by 72 odd crore. So if I calculate revenue from those numbers, it is like coming at very negligible revenue booked in April. Am I reading it wrong?

Yeah, revenue booked in April would be very low. Yes.

Because Q1 is like generally the lowest quarter for us.

Yes, yes. It is not no revenue. There is already 36 crore is overflow. Means 36 crore worth of material was dispatched in March, but was not considered under revenue recognition. This will come in April or first week of, first or second week of May, if it is going to America. Bless whatever was boomed in India.

Sure, sir. And, sir, on this Q4, gross margins have improved quite a lot. So, are you saying this is only because of the Forex improvement or are we seeing some better pricing and all?

Forex improvement leads to better pricing. Suppose I had taken a $10,000 job six months back. At that time, I had estimated dollar and rupee rate at 82. When I am dispatching it, if I am realizing 92 at the invoice level, then this 10 rupees is going into margin improvement.

So Q4 margins can be considered sustained or like it will...

Sustained. Because if the dollar is not coming down, then it is sustainable. But there is another reason for Q4 margin also, and that is increased revenue. Suppose the dollar value has remained same, but the revenue has come down, then you will see margin also coming down. Because overhead in Q1 remains same as Q2, Q3, Q4.

Sorry, sir, asking about gross margins only. Gross margins only have improved. So for coming year, what kind of gross margin can we expect?

The pet margins, I have said, would be between 12 to 30 percent. Gross margin would be between 50 to 55.

Sure, sir. And last question would be on your shareholding pattern, sir. I am seeing that quarterly there is some variation, some addition, sometimes, sometimes reduction. So maybe I wanted any color on that front, sir.

As a shareholder, I have only purchased, we have never sold. So if you are seeing some variation, it would be because of our earlier, one of the earlier promoters who are no more promoters, the Amin family, if they are selling, you must be seeing variation. Otherwise, in the Patel family, which is the promoters of the company, there is no variation.

Only last quarter there is a warrant which due on the February, I think. Which we have exercised. Which is exercised. So maybe promoter holding will be increased minus.

Yeah. Sure, sir. Thank you and all the best.

Thank you. We'll take the next question from Kunal Mehta from Ingrid. Please go ahead.

Hello. Very, very good evening, Pratik, sir. Daminder, sir. So my first question will be the Vestek acquisition. I think we have renamed it Jush Process Equipment Private Limited. And this will not be a part of stand-alone. Can you explain me how the structure, because I think Shefpat, we have merged with the Just Engineering Limited. And I think Shefpat also is more process equipment and Vestek also has process equipment. So what are the products overlap there? So, can you explain this to me?

So, first of all, Vestek has contributed very small percentage to the revenue because the acquisition was done sometime in end of February, mid-January or something. So, the only whatever was executed in last two months has come. Two, between Shivpad and Vestek, the major difference is Shivpad is process equipment for municipal business. And West State is possess equipment for industrial, paper and pulp, metal and minerals, alumina, etc. So they are completely different type of businesses. Though the equipment name may be same, but the design of equipment is much sturdier and stronger in view of the high density in metal, mineral or paper and pulp.

Okay, so you are saying that the product might be same, but design would be different in both. Exactly. And the margins would be eventually higher in the industrial one, in Shivpad, you are saying.

See, I would not talk about margin today. We have acquired the company now. We are going through the process of standardization as well as improvement in strategy, costing, manufacturing, vendoring. So once all these things are done, then only we will have a better grip over margins at Restek.

Okay. And sir, would you be having like the breakup in terms of how much have we improved in terms of volume versus value? For this year, value as in the dollar appreciation benefit versus how much volume appreciation benefit have we got?

We can share this data. Can you please put this on an email to us?

We can share this. And just one last question on the product end. Sir, we have acquired Mar quite a long time back. We are not seeing much improvement in the order booking. The order booking is, you know, sub 20 crores on the end. And that is one of the product recognized globally. So are we not pushing hard? How are we seeing the demand in screens? I think whilst we have improved in terms of mix from 10, 11 to 13 percent, but screens have almost remained the same. So any take on that?

So Mar screens are manufactured today everywhere. It is not only produced in Mar. So whatever is built through MAR is reflecting in their revenue. However, what is built from just engineering does not reflect in MAR revenue. And now we have also got orders in UK for screens. And those orders are also not going to reflect in MAR revenue because they will do only the designing and manufacturing would be done wherever we have taken the order.

Okay, so the 60 crore, I think, waterfront also has creams in it. Yeah.

Okay, okay.

Answer, Southeast Asia, you had mentioned, I think, some Vietnam order dispatch was not done, I think, last quarter, you had mentioned. Now it is done. So, is the Far East Asia problem kind of solved? Because from 16% mix, it's gone to 10%. Do we see that improving back?

I have been informing on and again that we are in projects type of business. If certain year project in certain countries does not come, we cannot increase revenue every year. So the mix would always change, mix of product and mix of markets will always change depending upon which projects are coming where.

But, sir, you have also mentioned that there have been, you know, rising sea level problems in Indonesia. Also, Singapore sea level is rising. We have filled some tender. So, any view on, you know, how far is because you are saying because of rising sea level, how will water control gates, valves, how will they play a role and how can JASH increase their percentage there?

So again, in this, let me give you a question. Rising sea level is projected at 21,2100 year. Right? So each country, depending upon its financial position, has started planning and executing projects. The first off the bench has been Hong Kong. We are doing a Yuen Long Barrage project, which is around 35 crores, plus other miscellaneous small gates and wall for the same project. So totaling to around 40 crores. This is the first project which is off the mark. It is one of the most prestigious projects now for Hong Kong. In the month of June, next month, 14 people from Hong Kong, including six video crew members, are coming at our plant to video and photograph and inspect and test part of that job. So, they have already started. I think in Singapore, where we have quoted more than $900 million worth of projects, Singapore would start tendering out. Today, it is at design stage with the consultants. They will start tendering out from 28 onwards. So every country, depending upon what is their cash flow situation or fiscal situation, will take up these projects and execute it over the next 20-30 years.

Okay. And sir, what is status on the Rodney Hunt new plant that we are developing?

I was in America a week back. The problem with Rodney Hunt, new plant is the cost has gone up tremendously. We had called various offers, we had meeting with them, we have asked them to revise based on whatever was our understanding between what we need and what they thought we need. And so once they give the final offer, then we have to take a call when to go ahead with it. However, Rodney Hunt in Houston, the new plant in Houston, as well as the plant in Saudi Arabia, the target is now to have it commissioned before. December 27th.

December 27th. Okay, I'll call back on you. Thank you so much. Thank you.

We'll take a next question from Samartha. Please go ahead.

I thank you for the opportunity.

Congratulations, Prateek, sir, to you and the team for a very resilient year. So Prateek, sir, just a couple of questions. Capex question is already answered. Just wanted to understand that we have done a lot of acquisitions, sir, very recently. So for the next two, three years, are we looking at more acquisitions or we would be consolidating the business as it is? So what's some color on that?

First of all, the acquisition which we have done have not been too stressful financially. They were not big companies. So, if another opportunity comes, we would be open to it based on how good the opportunity is and whether we can scale up with that.

Understood, sir. And sir, this 1,500 crore guidance, so is it fair to assume that with the kind of capability that we have built in, we can achieve this guidance and this is a conservative number and the pat margins would be somewhere around 13-14% as we pursue this? Fair to assume that? It is fair to assume that. Okay, sir.

And, sir, on the demand, manufacturing capacities, I would say if we do on three-ship basis, we can achieve 1200 crores. When the Rodneyland plant in Houston as well as in Saudi Arabia is online and working well, I think in five years' time, we will have capacity to produce more than 1500 crores.

Then the marketing has to raise up and bring the business, but it is possible. Got it, sir. And, sir, one final question. So, with the kind of acquisitions we have done, and so many companies are now part of us, so anything on the leadership front, are we hiring more people or something of that sort, or we are able to manage the operations? So, some color on that, sir.

We are able to manage the operations. As I said, in case of UK, we have two companies now which will be merged into one. So once it is merged into one, we will not need the top management team to be replicated. Same in America with Rodney Hunt, we are already well set. In India, we have acquired a company which already had a complete management team in place. So, we are not stressed as far as inducting people to manage all these companies is concerned. You would have also observed that what we are trying to do is reduce the number of subsidiaries by merging companies of similar businesses. So, ultimately, we will not have too many subsidiaries.

Understood, sir. And, sir, because of this war, etc., so are we seeing any slowdown externally? I mean, in trade, in certain countries like Asian countries, so are we seeing any kind of slowdown in the order giving or it was only because we wanted to take lesser orders? So that problem is sorted now. So just some color on that.

War had nothing to do with lesser order. Lesser order was in America because of tariff issues, unclarity or non-stability of tariff percentage. In Southeast Asia, Middle East, Far East, and Europe, we are still taking orders. However, dispatches to Middle East is still a problem.

Sure, sir. Sure, sir. Understood. So that's it from my end, sir. And I think congratulations on a very resilient year and we just hope that we continue to do well. So that's it from my end. Thank you. The resilient year was not very good for us, but okay.

Thank you.

So, sir, I have been invested in the company for three, four years now. And I mean, whatever you have committed, it has been very transparent and you have delivered on that. So nothing of that sort. So we are fairly confident that whatever you commit, so you exceed that only. So it's very heartening to see that. Thank you.

Yeah. Thank you. We'll take the next question from Sahil Dushi from Thinkwise. Please go ahead.

Hi, sir. Good afternoon, and thank you for your candid responses. Just firstly, I want to check, you know, since we merged Shippa, could you possibly... Excuse me, can you be a little louder, please? Am I audible now? Okay, so thank you for the candid responses. Just on Shippar, since we merged this year, could you just give us the comparable number for Shippar for full year? That will just make it easier to compare the two companies.

Because it is merged, it will be difficult for me to tell like this, but if you can write us an email, we can give you all the details of the merge entity.

Not a problem. I'll do that. So secondly, on the Vestek business, which is around 35 crores, we said a lot of revenue for Vestek is outsourced and there is an opportunity to ramp up this once it comes into the fold and there is synergy between Vestek and Shippar. So could you talk about your plans for that over the next one to two years?

So, see, we have recently acquired Westag. Even next week, I am going to Mumbai to visit them. So, we are one of the reasons Westag, when we see about Westag and we see lower profitability at Westag, the reason is they outsource everything. They don't manufacture anything themselves. Now, they will be using the infrastructure of just to manufacture some of their equipment to start with. This activity has already started and we have seen that when we manufacture within the facilities of judge, they would have significant reduction in their costs. Which will help them improve their profitability. But we have just started. It will take one or two years to understand everything and get everything produced as much as possible within just infrastructure.

Sure, sure. That helps. And, you know, I was just referring to the Concord Trust Script two years back, May 24, when we acquired Waterfront, you know, our target was in four years, it'll be 200-odd crores. 125 crores. And, I mean, I'm just referring to that the aspiration was somewhere of that much, is what we had shared. But possibly, sir, now, you know, when you're saying 125, 135, with pen stocks as well, are we being a little too conservative? And over the last two years, you know, do you think waterfront is not performed as per your expectations? And maybe some, you know, I could give you some idea.

Yeah. See, in UK, they work in offert, which is five years period during which the water industry is given a target to improve and do the carry out the expenditure, which is set by the government. UK is undergoing some problems. First of all, whenever this framework period starts, the first one and a half year is very slow. Because it is all done in planning. And then next three years is in execution and last year is again slowed down. So we are in the midst of that presently. But we expect huge growth from second half of this year. In fact, if you see what we have projected this year is 5.5 to 6 million. It is equivalent to 65 to 70 crore. So, when we acquired waterfront, the revenue was around 2.2 million pounds. Okay, from 2.2 million, in three years' time, we will reach something like 6 million. And in next two years, we expect to double it from 6 to 12. So, yes. What we projected was to do in four years, that may happen in five years now.

Sure. Understood, sir. That helps. And just lastly, sir, when you say, you know, you had some forex benefit, possibly to quantify how much would it be this quarter and how much of this is sustainable in the coming year?

All the orders which were taken with low rupee value and to be executed in future will get that benefit until the dollar doesn't come down.

Sure. Any, any ballpark number? How much of the unexecuted orders will be there at the end of the year?

We can give that data if you write to us, but I will give you whatever is the export order in hand today. So I said 675 or something like that, right? Whatever is the export order in hand today, more than 75% will qualify for that.

I'll request you to get back in a queue.

Sure, I'll do that. Thank you.

We'll take the next question from Naveen. Please go ahead.

Good afternoon, sir. Thank you for the opportunity. Hope I'm audible.

Yes.

Yeah. So my first question is on the guidance. If you see, look at the guidance, we have 40 odd crore coming from West Tech and 35 odd crore is the spillover from last year. So net of that, aren't we growing, is the projection on very conservative side because the rest of the operations we are projecting to grow by just 10%.

VSTEC, we are conservative because we still do not have a handle over everything. As I said, we have just taken our VSTEC, we are still trying to understand their business model, still trying to evaluate where we can improve, etc. So in the first year, we will be conservative, trying to unplug all those unknowns and then have a strategy in place to take it forward.

So, my question was, net of Westech and the spillover, our guidance is on the very conservative side. It is.

It is. If you have control over Mr. Trump, I can do all the guidance. We don't unfortunately have that. Okay. So, out of nine, as I said, 45 odd crore we must have billed. Right. 899 is the order book, so to put together is 945, 950 crore. When 950 crore is our situation today and I am projecting 875, it is conservative. But last year also we were conservative and see what happened. We never planned for America, we never planned for the war. So, I would rather go, remain conservative and try to achieve whatever I say, rather than being too optimistic and then failing again and again.

Understood, sir.

So, my second question is, earlier

we highlighted our intent to reduce our dependence on US, which was contributing close to 45% of revenues. So, which other geographies are you seeing stronger traction and incremental investment to diversify this revenue mix?

We said UK and Saudi Arabia, and we are working on it. The acquisition of penstock was because of that, and same in Saudi Arabia, setting up our plant is because of that. Plus, acquisition of Vestet was to strengthen the market offering in India for process equipment in industrial sector.

Understood. So, my third question is on Shivpad. In the last quarter, we had some labor issues because we are just starting operations there. Is it behind us, and are we making any incremental capacity additions there?

No, we are not making any incremental capacity addition. And it is wrong to say we had labor issues. We had quality issues because the type of labor which we wanted, we did not get. And so we had brought a team to indoor, train them, and have sent back. And I think we have nearly overcome those issues.

Thank you, sir. I have more questions. I'll get back in the queue.

Thank you.

Thank you. We'll take the next question from Dilip Shah. Please go ahead.

Yeah, Pratikji. This question is regarding Rodney Hunt. Yes. You know, we started, I think, in 2018 or so, when I think I met you, you were doing around $2 million. And we could ramp up quite rapidly from $2 million to $30 million in six, seven years. And, you know, Currently, even if I take a 2025 base of around 34 or 33 million dollars, you know, our numbers this year looks, ignoring for a moment to 2026, which has been a very unpredictable, turbulent year, you know, our numbers look slightly subdued in terms of planning wise, and I completely agree with you, Trump is uncontrollable, unpredictable, but Given, you know, all this turbulence, my question is that do we have the capacity on the ground? To, say, grow at 25%, 26% that we have grown in the last, between 18 to 25 in the first seven years, the way we grow at 25%, 30% CAGR. Can we grow at 20% CAGR from here to next five years? Because if you forecast that and say, assume that we will be a $100 million business by 2015, you know, do we have those things on the ground?

So, let me clarify one. We are targeting in next five years to reach $75 million. So, this year we are around $30 million. From 30 to 75 is the target in next five years. This year we are targeting $38 million, which I also agree is quite conservative because my order book and execution put together is more than $40 million as of today. So, I would say... I can plan 75 million easily, 100 million I am not planning because there are a lot of factors not in our control. Mr. Trump is still there for 2.25 years. You do not know what he is coming out with. Just to cite an example, in February, the Supreme Court gave a decision that he cannot put country-wise quota, country-wise tariff. Recently, last week, many products which we make, for which the percentage of tariff had reduced, has now been shifted to section 232, which is under national security. Now, I am sure a wall or a gate is not a national security item, but he has shifted it, and in national security, Supreme Court cannot do anything. So, things like this are day-to-day ground realities which are changing and it's not under our control.

Sure, sure. I understood that. Pratikji, my question was more like, say, when we're doing in 2025, when we did 33, 34 million dollars. And this year, suppose we are doing 38, say, 40 million dollars. And next year, it'll be around 50 or million dollars. But the employee cost hasn't changed much in Rodney Hunt. So, my question is that, are we really preparing for next three years, assuming that we will not have any hiccups like what we had last year? Or are we being ultra conservative and saying that, look, let's not scale up the business development sales on enough factory people? You know, that's what my question was.

Yeah, we are conservative. As I said, see, I placed an order for the plant, new plant, at around $4.2 million. The quotes which are coming now is seven to eight and a half million dollars. Nearly double. Right? So this is a very strange situation that all of a sudden in America, everything has become so expensive, so costly. So until there is some stability of thought working, it is so difficult to commit everything in America. So I would say that Presently, we are on track to reach around 30 to 75 million dollars in five years time and are planning execution accordingly. But we are not going that aggressive like we were going before.

Sure, sure. And as you said, the employee cost, if you see that, it is a growing regular basis, not stable.

And it has grown because we increased the employees and then this turbulence happened. Exactly. So we have not removed the employees considering that we can still with the same employees achieve this 38-39 million dollar revenue.

Sure, sure, sure. Now, I was just assuming that had there been no turbulence, we would be doing, you know, from 34 to 40 to, say, 50 million dollar by 27, right? But 50 million dollar, I don't see that. I would say 45 to 46. Yeah, but I don't see the equivalent amount of employee cost as of 27. So maybe you have taken into turbulence. My only request to you, Pratikji, is that we know that there is a lot of pain, but we all live in the hope of good days. So not to cut down on capacity that if tomorrow you get a huge opportunity, you are not able to address it. That's my only...

But the risk also is too great because there is so much of uncertainty today going on in America that if you are in a project manufacturing environment, not mass production, a project manufacturing environment, you never know what would be the new policies. Sure, sure.

Yeah, thank you. Thank you, Pratikji. That's all from my side.

Thank you. We'll take the next question from Ruben M. Please go ahead.

Yeah, hi. I'm just new to the company, so I have a few questions. You were talking about the Singapore order, and it was a quite sizable order. That's around like maybe 5,000 to 6,000 crores worth. Can you give me an update on it? And if you were to get the order, or when do you expect it? And if you were to get it, would you have enough manufacturing bandwidth currently to do it? Or would you be stretching out your resources? Because you have other orders within India itself, right?

Let me clarify first, it was not an order. We have submitted offers worth. 800-900 million dollars in Singapore for rising C-11. Now when would this be executed? The plan of government is to execute these projects over next 20-25 years, not in one year. Point number one. Point number two, I am not sure I will get all the 800-900 million dollars orders. Okay, so this, first of all, our market share will be 20, 30, or 40% in these cases. Two, this would be spread over 20, 25 years. Three, the starting year would be 19, sorry, 20, 28. Okay. Starting year of awarding the projects. So once the projects are awarded in 28, an award will be done not one project of few billion dollars. It would be every side to side specific projects would start coming out. So by the time it lands in our, we if we get those projects, if it lands, the first orders will start coming in 29. So it is still far away off.

Okay. Okay. And before accelerating into Houston, Rodney Hunt used to have around 600-700 crores of revenue, right? Yes. So do you see it going back to those levels without Houston? Or you're not looking at?

We are going to Houston because we are not getting people in Massachusetts, production people, people at our plant in Orange, Massachusetts. It's a very small town. Young people do not easily want to work there. They are all moving towards cities. So we are already facing problem of delays in execution because we do not have enough people. That is why we are setting up a plant in Houston. We have land, we have sheds, but without people, that's of no use. And so that is why we are going to use them. So to say that we can reach that level at orange, yes, it is possible if I get people and I modernize in orange.

If I'm not getting people, why should I modernize in orange?

Okay. Okay. And my one last question is about, so recently, over the last, you know, two, three years, we've been seeing a lot of acquisitions, new management now coming in. How, don't you feel that things might be a little bit more constrained? Would you be able to execute at the same level that you're executing right now in India, across these different, you know, be it UK, be it Middle East? Do you see that as a concern?

I don't see it as a concern. Whenever you acquire, the first two years are challenging because you are trying to establish your systems, your strategy, your policy, as well as evaluating existing manpower to see whether they can cope up or not. So first two years are always challenging. Doesn't matter how good or bad a company is. And once you have overcome those challenges in the first two years, thereafter the phase of growth comes. And so we are not much bothered. And please understand every company which we have invested in or we have taken over has been small in size. So, it has not affected our day-to-day working or concentration in other businesses.

Okay. Okay. Thank you very much. Fishing you the very best. Thank you.

Thank you. We'll take the next question from Sanjay Jaha. Please go ahead. Sanjay Shah, request you to unmute yourself and go ahead. Since there is no response, we'll take the next question from Yash Misharia.

Yes, Sanjay, go ahead. Yeah, sorry. I'm extremely sorry for Amya. Sir, Pratik, sir, I have a question for you is that, that in your opening remarks, you highlighted about the potential in US, and you are not worried about the tariff side of that, but is the uncertainty which is drawn. So now, what are the... Point to be understood from that, that what, if at all there is a rise in cost, if there is a rising inflation in US, and then how we see that opportunity coming to us in US, in spite of this rising inflation.

So, Sanjay, let me clarify one thing. There is a tariff. Now, tariff, every government has a right to implement tariff. You cannot say no to it. Our concern is not the right to implement tariff or the percentage of tariff that they have implemented. Our concern is that you implement 25% in January, then increase it up to 50% in June. So all those orders which I have taken between January to June, now I am going to pay 50% tariff, but it is estimated at 25% tariff. So this is where company loses money. However, when tariff was increased to 50%, as I have said before also, most of the American manufacturers, because if the steel becomes costly by 50%, the imported steel, then the domestic steel may increase the price by more than 50%, so that they can make money. That was exactly the purpose of increasing the tariff, right? So. Competition is not an issue. Because the steel prices in America today is more than 50% of the prices in India. Competition is not an issue. However, when we want to produce in Rotteni Hunt, we also have to buy American steel. And that steel is coming expensive. And so... It does not only affect just, which is exporting to America, the difference in tariff, but it also affects America because America also estimates sometimes on 25%, sometimes on 50%, and then they get steel, which is more expensive because the new tariff is higher. So stability of tariff is what every company desires. We have no full respect for the Trump administration to put whatever tariff they want to put. But please decide once for all what you want to put and maintain it.

But sir, my point was that after this inflation growing high, irrespective of tariff also, after this global uncertainty, war and all. So how that impacts our order flow? That impacts the...

Order flow will not get impacted, if you need water, you need water. Okay. But companies will be affected because of EPC contractor has taken a job, now everything has gone up. Many workers have taken on a job, everything has gone up. Employees are affected because their salaries are fixed for a year and the costs have gone up. So, this is something which brings unrest. Other than that, there is no problem.

Okay. So, my second question was regarding first time I heard you bringing certain optimism on Indian business. So, what is the rationale of that optimism doing more business in India? Are you seeing any green shoots over there?

Sanjay Bhai, Indian business was already there. We were always bullish about it. Is the Indian business big enough for the country of India size? No, it is not. I have always been telling the Indian business is very politically motivated. The biggest business we are in, the biggest type of equipment which we supplied is for wastewater. Even today I would say the central government focus on wastewater is not to an extent which is desired. It is rightly so because first we have to supply drinking water. The new 4 lakh crore budget for Jaljeevan Mission will ensure that by 2028 or 2029 all the water supply all around India would come to an end. Once that happens, the water which has come to your house, 80% of that will be converted into wastewater. Once it is converted into wastewater, someone has to think of treatment. We are waiting for that period to come. Already, huge number of projects in wastewater treatment are coming. And in spite of that, most of the metropolitan cities of India do not have more than 70% treatment capacity. So, even today, I would say billions and billions of investment is required to be done in wastewater treatment, and the next problem is after wastewater treatment, reuse. Water scarcity is happening. In Indore, we have everyday issue now today of water scarcity. So, this can be mitigated only by reuse. So, treatment, reuse, stormwater. Desalination, as well as rising sea levels, all these are problems of the future, which every government will have to address, India will also have to address, and I say for our type of business, huge potential will unlock after 28-29.

That's great, sir. Very well explained. Thank you very much. Thank you, Dharam ji. Thank you very much. Thank you.

We'll take the next question from Sahil Doshi from Thinkvites. Please go ahead.

Yeah, hi. Thanks for the follow-up. One, just quickly wanted to check on the other expenses. We've seen a sharp increase in this quarter. Meaning, even if I see it as a percentage of sales, it's much higher than usual. So, is there any one-off related to freight, insurance, etc., in this quarter?

It is a big charges from the U.S.

Okay. So, how much of that would be one-off, sir?

10 crore? Yeah.

Okay, because and also the other income has increased in this quarter to 9 crore versus 3 crore normally. So that is mostly foreign action. Oh, understood, understood. And just secondly, on the Saudis, sir, you said December 27th, 26th is what you look to commission the plant. December 27th. December 27th, okay.

Earlier was December 26th. Now, after the war, everything is gone awire. So, we have not been able to make the visit to Saudi Arabia. We plan to do it sometime in end of June, July, and then take the land and start the work and execute by December 27.

Okay, sir, because the question comes from this, like, you know, we see Vitek, Vavag, etc. being very aggressive yet on Saudi. So, just what's your view on Saudi, given the entire political situation, meaning the entire war crisis, and are we yet optimistic? If you can give some feedback, it will be really helpful.

I would say the war has to come to an end. Once the war comes to an end, they don't only have to rebuild capacity, they have to grow, and for that, they had huge plans of so many additional cities and this and that, etc., and they are welcoming many manufacturers like us to go into Saudi Arabia, which will result into huge capacity demand of water. So it would happen, but it would only happen when there is stability. Without stability, no country would be able to plan and dedicate resources towards any growth.

Sure, sure. And just to reiterate, sir, you said the Houston US expansion as well as Saudi both by December 27 is what your new target is.

Yes. In terms of Houston, I already have the land. The drawings are approved, everything is in there, only the problem has been the cost increase and that the company to which we had given the job, the owner expired. So they decided to close down the company. In Saudi Arabia, we still have to acquire the land. We have just set up the company, which is the first step. We have to acquire the land and then go ahead.

Sure, sir. Thank you so much, sir.

Thank you. We'll take the next question from Kunal Mehta from Ingrid. Please go ahead.

Yeah. Hi, sir. So usually in the presentation, you also mentioned what is the potential from every plant. So has it not changed from like the previous quarter? Like, how much is the potential revenue that Jash can, like, do?

So, 1200 crore, I think I told today, 1200 crore is the potential revenue from all the five plants put together, plus Rodney and UK. Existing. Existing facilities. Once we are able to bring online Houston plant and the Saudi Arabia plant, we would reach capacity of 1,500 crore plus.

So Ayus, you are saying as of today, we can easily manufacture equipment for 1,200 crore off. Exactly. Okay. And Houston will be 300 crore.

Houston and Saudi Arabia.

Okay. So that's how you are saying 1500 crore by F5 31. Yes. And you said a 16% CAGR for like from F5 17 to 31. 17 to 26 has been almost 18% CAGR. So are we saying that we'll be growing at a lower CAGR going ahead?

Yes, because the base is increased. It cannot be that you, the smaller base, you still increase at the same rate which you are doing at a smaller base.

Okay. And so margins is something that we will always be cautious of. We will be making similar level of margin. We will not be, because usually in FI 25, we We, the margins were a little, so there was a, you had mentioned that we went for revenue versus margin. So we had a 40% revenue growth, but margins had kind of declined a bit.

Yes, but if you see, let's talk about margin and new aspect. Margin on standalone basis and margin on consolidated basis. So if we look for margin on standalone basis, 23 was 14.52, 24 was 14.21, 25 was 14.39 and 26 was 13.38. This is standalone. Right? What does it reflect? That we have a standard policy. We are not, there is no big, huge differential in the margins. This is pet margin I am talking about. Right?

Yes. Same way consolidation, we are around 12 to 12.

Yeah, so same way consolidation, only when there is any big acquisition or big turmoil like we had today, this year, last year. Then it may get affected. Otherwise, our standard strategy has been focus on margins and moderate growth. So I would say any growth between 13 to 17 percent is welcome and margin minimum 12 going up to 14-15 percent is what we desire at that growth.

And also, sir, if I think you had mentioned previously that you will be giving a standalone and, you know, console working capital separately for us to understand, you know, the working capital scenario. So, will that be? Yeah, we can share that with you. But can you also make it like a practice of sharing it in the PPT or can that be done?

We'll talk to E&Y, if that is the industry standard, we'll do it.

No, no, no, industry standard. Just because our goods in transit is quite long because from here to dispatch it to, let's say, US or somewhere, it takes a lot of time. So we just want to understand how fast we are on the working capital, how optimized we are in the domestic versus... What is the situation in the overseas when we

have no problem giving this? Whether to make it part of this presentation, I would have to think about it. Okay. Because you have some query, definitely write us.

I will write it too. Thank you.

Thank you. We'll take up next follow-up question from Tirip Shahu. Please go ahead.

Yeah, Fratik Bhai, our pending order in Rodney Hunt, around 28-29 million dollars came before February, Barrier Revision. So, is it fair to assume that we would have factored a 50% tariff in those orders because they came before the tariff?

Over 80% of those orders are with 50% tariff. Some orders may also be quoted in February to June period. So, that would have been quoted with 25 and they may still not have been executed today. But most of that, what you said is, you can say 50% already estimated.

So we can say in those portion, we are fairly high pat margin of 18 to 20% can be doable if there is no other change

of escalation or inflation in steel prices.

There is already escalation in raw materials. Yeah, but we have delivered 18%, right, in Q4.

No, but in India itself is a 20% rise in the raw metal prices.

Even in America? Yes, in America is also. So, it is all subjective. Some orders we may be able to give, some orders we may not be able to give, depending on what is the material of construction of that order and what was the price rise in that material.

Yeah, but definitely it will give more margin as compared to others, which you have booked on the 50%.

Sure. Sure. Thank you. We have that buffer. That's a good thing to know. Yeah. Thank you.

Thank you. There is one question in the chat box. This is the question from Amit K. Can you please provide what is the capex incurred during FY26 and what is the guidance for FY27?

So the capex incurred during FY26 was more than?

37 crore in plant and machinery and 30 crore for the acquisition. So total 67 crore.

And this year would be something like 15 crore.

Okay.

Yeah, for the India plant. For the India plant, for the America and Saudi Arabia, we still do not know how we are progressing, so I will not be able to tell about this. But the five Indian plants, around 15 to 16 crores is the capex planning.

Okay. Thank you, sir. That was the last question for today. I will request you for closing remarks.

Thank you everyone for patiently listening to me. Though we try our best to give as much data as possible and to be as exact as possible, sometimes things are beyond our control. It ruins everything for us. That is what has happened last year. I hope the world is at a very stable stage in this year. And if it remains so, I'm sure whatever we have given the guidance, we will be able to meet and ensure that all the investors remain contented with our performance. Thank you.

Thank you. Thank you, sir. Thank you, everyone, for joining us today. If you have any additional questions, you can reach out to us anytime. We wish you good health and look forward to seeing you again in the next quarter. Have a good day. Thank you.