Ravindra Energy Limited (RELTD) Q2 2027 Earnings Call Transcript

Good morning, ladies and gentlemen. I'm Akash, moderator for the conference call. Welcome to Ravindra Energy Limited Q2 and H1FI27 earnings conference call. As a reminder, all participants 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 the conference call, please signal an operator by pressing star, then zero on your touch-tone telephone. Please note, this conference is being recorded. I would now like to hand over the floor to Ms. Tanishka Tanvi from GoIndia Advices. Thank you and over to you.

Thank you, Akash. Good morning, everyone, and welcome to Ravindra Energy Ltd. Median Earnings Call to discuss Q2 and H1 FY27 results. We have the Senior Management of the Company on call, Mr. Shantanu Lat, Chief Executive Officer, Ravindra Energy Ltd. Mr. Narendra Murkumbi, Vice Chairman, Ravindra Energy Ltd. Mr. Vikas Pawar, Chief Financial Officer, Ravindra Energy Ltd. Mr. Pankil Shah, Vice President, Finance, Energy in Motion. Mr. Shantanu will first speak about the RE business, followed by Mr. Murkumbi, who will cover the EIM business. We must remind you that the discussion on today's call may include certain forward-looking statements and must be therefore viewed in conjunction with the risk that the company faces. May I now request Mr. Santanulak to take us through the company's business outlook and financial highlights, subsequent to which we can open the floor for Q&A. Thank you, and over to you, sir.

Yes, thanks. Thank you. Good morning, everyone, and thank you for joining the call. Let me start with a brief overview of where we are on the renewable energy business. So we set out a target of reaching a 500-megawatt operating portfolio by March 27. We are already at about 300-megawatt portfolio now, operating portfolio. Thank you. And another 226 megawatt projects are under construction. Most of the cases, the land is already acquired. PPA is already signed. So we are on track to achieve the target set out of 500 megawatts. In terms of generation, for this quarter, the total generation record is about 66 megawatts, 66 kilowatts are a million units. And in the half year, basically, we are at 145 kilowatt hour million units. On the financial performance of Rabunga Energy, this basically includes the entire solar business, which is basically the IPP, the EPC of our projects, and the electricity generation and trading. For the quarter ended, the turnover for electricity generation was 31 crores. Electricity trading, we were at 2.6 crores. The total revenue for the quarter was 190 crores. For the half-year ended, we are at 310 crores versus 30th September 25 half-year of 287 crores. EBITDA for the business was 53 crores for the current quarter versus basically same quarter last year, 33.4 crores. In terms of half year, the EBITDA was 93.7 crores versus 67.3 crores for the same period last year. In terms of fact, before eliminating the Losses add energy in motion. For the quarter of September 26th, the tax is 26 crores, and compared to 24.4 crores for last year, same period last year. In terms of half year, the tax was 38.1 crores versus 47.4 crores compared to last year. The drop-in type for H1 primarily is because of the lower. EPC-HCA revenue moved in the Q1 of comparative period, Q1 this year versus last year. Once we adjust for the losses at EIM, the pact on a consolidated basis for the quarter ended September 26th is 19 crores versus 24.4 crores for same period last year. In terms of half year, we are at 20.7 crores versus 46.6 crores last year. Again, the main impact is from the loss at EIM, which basically something that we will talk about once we get into the energy in motion business. Overall, we are looking at adding... Another 200 megawatts of operating capacity. So basically, just to put this in perspective, last year, from the year, we had almost about 100 megawatts of capacity. And this year, basically, overall, it should be between 200 and 220 megawatts. Once fully operational, basically, this soon. For Q3, we would basically have an operating capacity of about 300 megawatt, and in Q4, we basically will have an operating capacity of about 400 megawatts. And the EPC revenue for the two-year would be basically a 200-220 megawatt capacity addition. So that's the broader picture on the renewable energy business. So I will hand over to Mr. Mokombi for... Thank you.

Good morning, Mr. Narendra Mukundi. The electric vehicle business continues to show a strong outlook. We sold 142 vehicles last quarter as compared to 58 in the first quarter. We also see a very, there is a very strong tailwind in the business, and we see a strong order book coming in the next two quarters. What we've learned is... That we, from the time of engagement to conversion into sales, the cycle is about six months and that is one of the reasons why sales are not going. List of potential customers, the amount of interest that we have, and depending orders, purely waiting for conversion into a firm sale, due to construction, due to electrical charging infrastructure under construction, is pretty strong for the rest of the year. So, therefore, we are guiding for a much stronger second half of this year. I think the rollout of next... Our side is going well. What I can say is that the vehicle that we have launched has very strong customer satisfaction levels, uptime above 99% for most customers, and a significant number of the vehicles sold, for example, this quarter are repeat orders. People who do small trial orders in the previous quarters are now buying their second and third. This is very reassuring. Our charging network sales were up almost 65% over the previous quarter. We are now starting from this quarter disclosing the amount of energy sold for charging and starting. The numbers are there on slide 6 of the presentation. We have expanded some charging locations here where the current side of business does not justify a full-scale trap station. However, we have a significant number of trapping stations and independent trapping stations under construction. We expect to go from the current 8 trapping stations to We will be speaking by December 26th and to 30th March 27th. A group of our network expansion is planned around the Northwest Corridor of India. We start from Pune, Mumbai. And all the way up to This accounts for almost one-third of India's heavy truck business, heavy truck traffic, and it's the most industrialized corridor of India. So we are focusing our network build-out here for, you know, faster acceleration of both truck sale volume and of the charging business. Coming to the OEM side, the manufacturing side, we're very happy to inaugurate a very modern facility in Pune for assembly of trucks, and a facility in the same complex is coming up for commissioning next quarter for assembling battery packs. We announced a tie-up with CAGL, the world's largest battery manufacturer, to assemble their... In fact, in India, this is the first time. And we have an aggressive... Thank you. Also, on the 30th of October, we rolled out the first India-assembled truck from the facility, and we expect regular production from this facility from January after the plant is set and all systems are tried, etc. I will come to the financial performance, sales were about, and I think 48 crores versus 40 crores. Thank you. The sales were at 10.7 crores, or 6.5 crores in the previous quarter. So again, a jump of 50% plus, and I think we will... How does our age translation? Thank you.

And we expect to fill the capacity similarly on the expanding network.

Our loss has narrowed and volumes have fixed up. The company's target is to turn a positive... However, we are not, you know, economizing where expenses have to lead the sales. Network expansion and after-sales service system expansion is critical to improve market share. So the company is investing. Equity, paid-up equity is now 400 crores, we've also got another additional 100 crores of shareholder funds, and we are going ahead with the merger with... The necessary papers have been filed in exchanges, and I think it's going through the regulatory process smoothly and expecting to, you know, complete legally all formalities of the merger by the third or fourth, sorry, by the second or third quarter of. And the last point is that I think in order to support the... We incorporated a step-down subsidiary for EIM Megaplex, which will be the network company hold all the charging assets. And the batteries that we provide as a service, all of that will be here in Megaplex. You can go to slide two of the presentation. After the merger, and this company is now BI Megaflex, the network company is now operational, and all the charging assets will be in that company. All in all, The rising price, the price of diesel has increased significantly, and the overall competition. We have an actual operation, where our customers are now able to... Thank you. On a cost per kilometer per kilometer per customer, we expect a very strong... In the heavy vehicle market, we ourselves are working on two other products which we expect to launch in the next 12 months, of which the first one will be a heavy-duty shipper, which is a market which is... And particularly, electric cyber-based. So with these few remarks, I think we can go ahead.

Thank you, sir. Ladies and gentlemen, we will now begin the question and answer session. If you have a question, please press star and one on a telephone keypad and wait for your turn to ask the question. If you would like to withdraw your request, you may do so by pressing star and one again. Ladies and gentlemen, if you have any questions, please press star and one on a telephone keypad. The first question comes from the line of Mr. Deepesh Anchieti from Mania Finance. Please go ahead.

Hi, I'm audible.

The audible, sir.

Yeah. Now, what is the current average selling price per electric, heavy, commercial vehicle, and how does the management expect the pricing to evolve with increasing competition?

You said the average selling price for vehicles?

Yes, per electric or heavy commercial vehicle.

So our average price is around 60 lakhs. 95% of our sales are without the batteries. So these are trucks without the batteries.

That's right. And we are giving battery as a service, right?

That's right. So those packages, they are based on the minimum commitment of how many units of electricity the vehicle will consume per month. And depending on the average running of a particular application, whether it's in a port, whether it's long distance on the highway, these energy packages start at around 14 lakhs per year for low running port applications and go up to as high as 15 lakhs per year.

What is the current order book for electric vehicle, commercial vehicle, and how much of the planned production capacity is already supported by customer commitment?

So we won't disclose the order book, but one can guide that the second half sales will be significantly stronger than the first half. The network expansion is being driven by some MOUs with large transporters, which we have signed, where I think we signed MOUs totaling almost 1,500 vehicles, which will be delivered in part as the network is commissioned, and people can actually operate the trucks on those corridors. And, you know, this will be done in phases. Overall, as I said, in most groups now, electric trucks are price competitive on a total cost per ton per kilometer basis, which is what matters. And it's only a matter of time where people get used to financing and operating these trucks before we see rapidly rising penetration in the heavy truck market.

Right. So, if I can ask, what is the current production capacity, utilization, and telecom facility, and what are the key milestones for increasing production volumes?

So, we have designed it for a capacity of 5,000 vessels a year. We do not expect, you know, to freely fill that capacity immediately, obviously. The battery plant is a similar capacity. We will start actual full-scale production from January. The plant is ready. We are doing dry production of CKDKs, and we will start actual production at the run rate of about 200 acres per month from January.

Right. And how much are we dependent on external supply components for critical components, especially? And what proportion of the vehicle or the battery pack value is currently localized? I'm asking this question in the context of China now banning a lot of, you know, technology, especially in, you know, energy storage. Is it going to affect us, or how are we planning to sail through this?

So, not only us, but almost every, in fact, every OEM in the heavy electric vehicle space right now has a significant importance content. I think in our case, we have an aggressive indigenization plan. The Pelagam facility is a first step towards that plan. Our technology agreement allows us to indigenize a significant part of the vehicle. However, as you know, the requirement for any successful transition to domestic involves both having the right technology, which we have, but also volumes. So as volumes grow, we expect a rapid indigenization of a lot of... of the vehicle and the battery pack. However, there are two, three critical things for which India will be dependent on imports for some time. For example, the battery cells and some critical parts of the electric motor. I think these are medium to long-term kind of challenges which the government itself is addressing at various levels. We see a lot of... We've already acquired good technology from China and other countries, and I have no doubt personally that as volumes grow in this sector, we will be able to source a lot of the components in India. The non-electric portion of the vehicle is actually very well sorted in the Indian auto components. The Indian auto components are actually very competitive, both on price and quality. I think the focus is on how soon battery cells can be indigenized, and the second is on some critical components of the electric power.

Right, and just to understand, once we sell our vehicle, what is the service value for the battery as well as the infrastructure which we provide? How much is the revenues which we can expect from per vehicle if you can give me the unit economics?

So here, EIM has a very different philosophy to other OEMs. For us, after-sales service is not a profit center that is conscious. Firstly, our vehicles are very, very reliable against an average 90% of new diesel vehicles. We are currently delivering 99% plus. Vehicle itself has a big few moving parts compared to a diesel truck. So our goal actually is to have minimum after-sales service and breakdown. And we do not expect any significant ANC revenue. The battery on the other side is a sensitive piece of equipment. And because we operate the My3 scheme, which is a battery-as-a-service operation, the care and tracking and maintenance of the battery is entirely our responsibility and on our balance sheet. And we have a very large, now sophisticated technology team on batteries. To track those. In fact, I would claim that EIM has some of the best expertise in the life cycle management of large batteries in India. I hope that I'm ready. Can we move on to the next question? I think we've had complete follow-up questions already.

Thank you, sir.

Ladies and gentlemen, if you have any questions, please press star and one on a telephone keypad. I repeat, if you have any questions, please press star and one on a telephone keypad. The next question comes from the line of Mr. Church with Malu from Genuity Capital. Please go ahead.

Hi, sir. Thanks a lot for the quantity. My first question is, like, Leon, our current capacity of 523 in our portfolio. So, like, what is the company's target for the renewal capacity addition to the project, like, in, like, two to five years?

Yeah. So, on the solar business, What we intend to do is from the capacity perspective is that we – one of the main intentions of the merger was to see whether we can utilize the in-house capacity for building the solar projects or the renewable projects required for the charging network. So we don't intend to bid for a new government tender. Of the existing capacity, we are evaluating strategic options like monetization of these assets. We believe there is a strong market for monetization of our existing projects, both operating and under construction. And the equity that it would yield would help us grow the EINs network manifold from where we are without having to raise any external capital.

Next question, please.

Chachit, sir, do you have any more questions, sir?

Yeah, just one more question.

So, how much are we expecting for, like, FIT, military and FIT in terms of revenue?

I didn't ask.

So, on the solar business, what I can talk about in terms of, let's say, on the EPC side, we are looking at close to about. We should be able to do about 200 megawatts, so just to put things in perspective, we basically had capacity, we had added about 100 megawatts capacity last year, and if we were to add Thank you. Potentially look at EPC revenue of close to about maybe 600 crores for the full year, of which 200 crores has been booked now for H1. And on the electricity generation, basically, we expect that against, basically, an overall electricity sale of 89 crores last year, we should be close to about 140, 150 crores for the full year. And on the fact we should be able to do better than what was in the last financial year, on the EIM, as Mr. Morkumbe had already mentioned that our losses for Q2 have already narrowed compared to Q1. And we expect the trend to continue for the next two quarters, but on specific numbers on EIM, we would not like to guide on the specific numbers, but in broader trend that the Q3, Q4 losses we are expecting to narrow significantly.

Yeah, yes, thank you so much. Thank you.

Thank you, sir. The next question comes from the line of Mr. Vikas Barkla from Bains Advices. Please go, sir.

Good morning.

Congratulations on good results. I wanted to ask what is the expected timeline for completing the merger and what key milestones are remaining still?

So, we filed the merger scheme with the stock exchange last month. We currently, I think as a process, there is a 21-day window where the scheme is. We are currently undergoing a review as well as some queries on the overall scheme. We expect that hopefully by the end of this month, it is moved to SEBI for their review. And typically, the SEBI process, what we are guided by our advisors, takes about three, four months, So, overall, we are looking at something like September 27th as a likely completion timeline. Of course, it is subject to the various approvals that I mentioned just now.

Okay, thank you. And if we could get some more, like,

updates following in between earnings call also, is that right? Like, we'd be expecting updates on this.

So, we basically... We are, for the last four quarters, we've been putting up business updates for the quarterly performance. On the interim between the quarters, basically any major sales event or any event is being informed. As we are basically kind of maturing on the business, specifically on EIM, The intent would be to put together the operating numbers as we move along on a regular basis, maybe on a smaller periodic basis. But at this stage, probably... We would for the next couple of quarters basically put out the quarterly updates probably as we move along. Maybe a monthly or a regular update would be there.

We are disclosing from time to time important technology tryouts. We announced large MOUs with previous customers. I must caution that the MOUs do not bring sales in the next quarter, but we would expect to convert MOU quantities into sales over the next one or two years in changes, starting with smaller quantities first, that I think is up for them.

And the third is the important commissioning of large...

And thank you for that feedback, and we'll be, I think, we'll be.

Thank you, sir. And just to add on to it and

end with my questions, I wanted to understand if, I mean, there would be some sort of leverage happening between the renewable energy portfolio and the EIM's charging infrastructure and the battery swapping network. I wanted to get some idea about what kind of numbers could we see post this? If any guidance you can give us.

So on the integration of renewable with the charging network, so the existing portfolio that we have is essentially tied up on long-term PPA. So that is basically something that I mentioned about the potential monetization. The new projects that we are likely to build Thank you. Thank you. Thank you. Thank you. Two-and-a-half to three NBA So, a single swapping station should be able to take anywhere between two, two and a half megawatts of solar through the day without considering any battery energy storage. If, basically, we were to kind of extrapolate that and say that what is the total consumption of solar with a band, probably we would be able to take it up to about four megawatts for a single swap station. And if we were to basically add another 100 swap stations over the next 18 months, that is something that we are talking about 200 to 300 megawatts of solar capacity. Of course, we would not do it all by ourselves, it's state where basically . We have an open access where basically we find locations and then we go for open access, something that we need not do it on our balance sheet, something that we can be more efficient. State-level players who are more efficient in a specific state, and for sites where we have to evolve our own projects. Energy remains central to our overall plan. Whether we do ourselves or whether we outsource, it is something that we will . Energy strategy would lag a few months behind our buildup of charging network, but we are cognizant of this being a key input. Also, to highlight that we have a large electricity trading book in Ramitra Energy this year. We have about 120 megawatts of electricity trading every month, something which would also enable us to source lower cost energy for our charging network.

Thank you, sir.

Thank you, sir. The next question comes from the line of Mr. Siddan Blodhiya from Shanshi Fund. Please go ahead, sir.

All my questions are answered. Thank you.

Thank you, sir. The next question comes from the line of Mr. Nirav Dalal from MIB Securities. Please go ahead, sir.

Mr. Nirav Dhalal, please go ahead and take a question, sir.

Am I audible?

Yes, sir, you're audible.

Hello. Yeah, okay. I had a couple of questions. First is, we spoke about, you know, turning, breaking even next year on the EIM business. So, I just wanted to know what would drive this. So, is it that once we reach a specific number in terms of, you know, units sold, we would reach there and… Related to this is, what would be our contribution margin at the moment for the trucks?

Our contribution margin right now is about 6%.

It was earlier in the 8% range, but the... The weakness of the rupee has had a small effect on it. However, going forward, I think an annual run rate of 2,000 Americans should be very positive for the business. Also, we are currently tracking in overall, you know, capacity utilization in terms of swaps per station at around less than 30%. But as the network fills up, With additional trucks, we are expecting a healthier bottom line for the network business. We can already see the quarter-on-quarter improvement both in utilization and per unit profitability, but this has some more, you know, needs two, three more quarters to mature. So it's basically volume growth both in the network business and in the OEM business.

Okay, okay. Both of them would drive the break-even and then the positive. Yeah, they are both synergistic to one another's network

expansion driving vehicle sales and vehicle sales are driving the utilization of the network business. Together, I am giving you one very broad number, which is the sense of why we are very optimistic about the business. When you buy a truck from us without the battery, you're paying 25 lakh extra upfront compared to a diesel truck. However, when you subscribe to our package, including the battery, you're saving 10 lakhs a year. So the payback now is 2 and a half years. The only reason sales are not accelerating faster is because people have been used to diesel trucks for 50 plus years. So to shift over from diesel to electric, everybody recognizes, every large transporter in this country recognizes that you have that

electrics are the future of heavy mobility.

But people want to do it in stages. So we have customers who own thousand plus diesel trucks who initially bought two trucks almost. Then went to 5, now are negotiating 20. So people adopt new technologies in stages. That is the only thing that is taking time. According to me, we have, you know, more than half our sales are now repeat sales to customers who are already using our trucks or have used other electric truck brands in the past and shifted to us. So it's a question of just time. The last point on this in adoption is finance. And I can tell you we have more than 10 banks now lending to our customers for our vehicles without battery, which itself is a major breakthrough. Vehicles have been funded without battery, which means the lenders have confidence both on the operator of the truck as well as on EIM to continue to maintain and, you know, service the batteries and energy for these trucks over their lifetime, or at least for the tenor of their home. Besides that, we have a lot of leasing companies, including specialized green finance leasing companies, who are very active, and the largest NBSs in the country are all actively funding our customers. So the financing pipeline has taken off very fast compared to the very recent adoption of electric heavy vehicles in the country.

Well, that actually you answered my second question, and this is going to be my second question in terms of how the financing is happening, and so is it the customer who is driving the financing, or, you know, we have direct banks and NBFC who are willing to do the financing for. So, yeah, thanks. Thanks on that. And finally, in terms of we're looking, we would be in the future looking at, you know, So, what is the timeline that you see there? Would it be 27 or 28 when we are pushing for more Capex in terms of building the network? Or are you already starting to look at that opportunity?

We are looking at various ideas, there are some, you know, and In our view, you know that the growth of our nationwide country swapping and charging network, we are very bullish about it. We're seeing a lot of strong potential demand from a lot of large transport companies and corporates. Thank you. Thank you. The same expertise is exactly what is needed to build a nationwide electric heavy-trust charging and battery-strapping network integrated with renewable energy. Shantanu Laat and its team have built solar projects in more than 90 locations just in the last two years. So this is exactly the expertise we need, particularly to build our own proprietary network approximately. And the last thing, which may not be apparent, is all our network, while it is focused around trapping batteries for our own heavy trucks, is also fully flexible to charge any medium and heavy vehicle in the country. So, the same hardware, the same electrical infrastructure can equally charge. So, we are setting up some of the largest starting stations in the country, and given the cost economics with diesel vehicles, I expect very strong robust incapacity utilization. We now started from this quarter to disclose, you know, the energy that is sold, and you can track that growth against, you know, against what we are saying.

And sorry, and one last question in terms of what would be our diluted equity once the merger is, amalgamation is completed? Sorry, I, we, if you could be. Diluted equity when the merger is completed.

Thank you.

From a, we will get back to you on the numbers, but from a net worth point of view post-merger, we're looking at about 900 crores of net worth post-merger.

Okay, okay, okay, okay, okay.

I'll get back in terms of the value of equity and stuff. Thanks a lot for the opportunity.

Thank you, sir. Ladies and gentlemen, if you have any questions, please press star and one on a telephone keypad. I repeat, if you have any questions, please press star and one on a telephone keypad. The next question comes from the line of Mr. Limish Sheth from GT Advisory. Please go ahead, sir.

Thank you.

Naren and Shantanu and team, congratulations on your inaugurating your

new plan and that too in record time.

I have two points.

One is, where do your SKU units land? You know, those units land at the JNPT port, and then you transport them to

Kalegaon, and you transport them on EV trucks, and are they photon trucks? And the next is just a request. When can you...

Invite analysts to visit your plant when it's finally up and running. Thank you. Two very good questions. Yes, we are in fact commissioning our charging infrastructure on the Mumbai-Pune corridor by end of November. So subsequently, we expect to move all our goods from DNPT to Pune by electric plant. Your second question is about a factory visit. We expect to be in full-scale production from January, so next quarter, I think it's a very good suggestion. We'll organize an analyst and investor day at the factory. By then, we will also hope to have commissioned our battery plant. We are, in fact, launching it with CATL's latest model of heavy vehicle battery pack, which has a significantly improved life. Compared to the current generation of battery cells. So those kits are also coming in from China later this quarter, and we hope to start that also in January. So I think that's a good suggestion and we'll definitely organize it next quarter.

Thank you. I think one last question before we go.

Sir, there are no further questions lined up for the discussion. Now I hand over the floor to the management for closing comments.

So, I think we would like to say that we are optimistic about rapid growth and adoption of electric vehicle and our role, EIM's particular role in it as a market leader. We have announced a merger that reorients all our capital and our skill set existing in the group. We are focused entirely on this sector. We don't want to be distracted with, for example, smaller vehicles or with making buses. All of which have similar technology pipelines. However, we stay focused on the heavy commercial vehicles, trucks that are 18 ton plus, aim for market leadership there, and continue to offer customers an entire ecosystem, right from energy to charging infrastructure to the best vehicle possible.

So thank you very much for your interest in Ravindra Energy and Energy in Motion,

and hope to meet you regularly from this quarter onwards. Thank you. Thank you, sir.

Ladies and gentlemen, this concludes your conference for today. On behalf of Ravindra Energy Limited, we thank you for your participation and for using Durstabha's conference call service. You may disconnect your lines now. Thank you and have a pleasant day.