GPT Infraprojects Limited (GPTINFRA) Q2 2027 Earnings Call Transcript

Ladies and gentlemen, good day, and welcome to GPT-INFAR Projects Ltd. Q2 and H1 F527 earnings conference call. As a reminder, all participant lines will be in the listen-only mode, and there will be an option 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 touch-tone phone. Please note that this conference is being recorded. To discuss this quarter's performance, we have from the management, Mr. Atul Tantia, Joint Managing Director and CFO. Before we proceed with this call, I would like to mention that some of the statements made in today's call may be forward-looking in nature and may involve risks and uncertainties. For more details, kindly refer to the investor presentation and other filing that can be found on the company's website and stock exchanges. With that, I would like to hand over the call to Mr. Atul Tantia for his opening remarks. Thank you, and over to you, sir.

Thank you. Good morning, everyone, ladies and gentlemen. First of all, I would like to wish you a very happy Diwali in advance. I welcome you all to the GPI Intra Projects Limited Q2 and H1 FY27 Earnings Conference Call. I hope you have had the opportunity to review our financial results and investor presentations, which were uploaded on our website as well as the website of the stock exchanges yesterday. With me, I have Cygnus Partners, our new IR firm, who will be assisting us going forward. Coming to our H1. F527 performance. Execution across our projects remained broadly stable during the period. However, certain projects witnessed temporary moderation due to the West Bengal Assembly elections during April and May, along with an extended monsoon across several parts of the country. These factors impacted workforce availability and project execution during the period. With workforce availability now normalized, execution is gaining momentum. Alongside this, improving order inflows and a healthy project pipeline are expected to support our growth outlook for the coming quarters. Despite these temporary hiccups, we continue to make steady progress in strengthening our project portfolio, expanding our presence in railway infrastructure, and diversifying our business through the addition of signaling capabilities and the expansion of our international operations. As we look ahead, we believe that the company is entering into an important phase. The opportunity before us is not merely to grow the scale of our existing operations, but to build on our established engineering and execution capabilities to participate in a wider range of infrastructure projects, improve the business mix, and enhance long-term profitability. Coming to our key business developments, our order book Continues to provide a strong foundation for the company's growth. As on date, our outstanding order book stood at approximately 5373 crores, equivalent to around 4.3 times our FI26 revenues, providing strong revenue visibility. During the quarter, we secured a significant railway infrastructure order valued at Rs. 484 crores from RVNL for the construction of an important 544-meter-long open-web steel girdle bridge over Mahanadi in Odisha. This order further strengthens our railway infrastructure portfolio. Alongside this, Alcon builders and engineers The wholly-owned subsidiary of the company, which was acquired in February 2026, has secured multiple signaling contracts, aggregating to approximately 428 crores. This takes Alcon's total outstanding order book as on date to approximately 480 crores, its highest-ever level, providing strong revenue visibility and strengthening our presence in the railway signaling segment. Some of the key contracts secured by Alcon include Rs. 134 crores from Western Railway, Latlam Division, for the survey, design, supply, and installation, testing, and commissioning of four-aspect automatic block signaling, electronic interlocking, and associated works along various sections of Latlam Division. 114.82 crores from Northeast Frontier Railway, Katihar Division for the provision of electronic interlocking at 10 stations along the HDN-HUN route. 85.53 crore contract from Eastern Railway, Arsenal Division for the commissioning of the automatic singling using Mazdaq electronic interlocking at New Magma and Magma Yard, approximately 25 km of the dedicated red corridor section. I was discussing it earlier. Our Africa business is also expected to deliver strong order inflows during the coming quarters, providing good visibility from this geography over the next three to four years. In this regard, I am pleased to share that our subsidy, GPD Concrete Products South Africa Private Limited, has secured a significant five-year contract valued at approximately 385 pros. From Transnet Freight Rail, the primary customer, this order further strengthens our presence in the African railway infrastructure market and provides long-term visibility. For FY27, we expect our African operations to contribute approximately 80 crores in revenue, with South Africa and Ghana being the principal contributors. Thank you. Minimum 3,000 crores in F527. Decent order wins will support H2 performance and contribute towards achieving our revenue target. Supported by sustained public sector investments and a favorable infrastructure spending environment, we continue to evaluate opportunities selectively while maintaining a disciplined bidding approach with strong emphasis on project quality, risk management, execution timelines, and expected returns. Our order book strategy remains largely focused on balancing growth with execution quality. With a substantial order book and a healthy bidding pipeline, our priority is to convert these opportunities into timely execution and sustainable growth. Moving on to our financial performance for Q2 and H1 ended September 30, 2026. Starting with revenue performance on a standalone basis are revenue from operations for Q2 and FY27. Stood at 275 crores compared to 269 crores in the corresponding quarter of the previous year, registering a growth of approximately 2% year-on-year. For H1 FY27, standalone revenue from operations stood at Rs. 557 crores. On a consolidated basis, revenue from operations for Q2 FY27 stood at 291 crores compared to Rs. 279 crores in the corresponding quarter last year, reflecting a growth of approximately 5%. For H1 FY27, the consolidated revenues stood at Rs. 594 crores compared to Rs. 591 crores in the last year. Moving on to operating performance, standalone EBITDA for Q2 FY27 increased by 17.7% to 44 crores compared to 37 crores in the corresponding quarter last year. EBITDA margin expanded by 215 basis points to 16% compared to 13.9% in FY26. For H1, standalone EBITDA grew by 13.4% to 83 crores compared to 73 crores in the corresponding period last year. EBITDA margin improved to 14.9%, representing an expansion of 227 basis points. On a consolidated basis, EBITDA for Q2 at 527 stood at Rs. 41 crores compared to 40 crores in the corresponding quarter, registering a growth of 4.5%. The consolidated EBITDA margin for the quarters stood at 14.2%. For H1F527, consolidated EBITDA increased by 16.1% to 89 crores compared to 77 crores in H1F526. The EBITDA margin improved to 15% from 12.9%, representing an expansion of 203 basis points. We are very confident that the EBITDA margins will be in the range of 14% to 15% on a consolidated basis, And this is... Due to the addition of the high-margin signaling business and the Africa operations picking up quite well, improved execution efficiency is better operating leverage, and our calibrated project may continue to support this margin stability. Going forward, the addition of the signaling business and the gradual scaling up of our international operations, particularly in Africa, are expected to further strengthen our overall margin profile and support profitability over the medium to long term. Coming to profitability, standalone PAC for Q2-FI27, so that would be 20 crores with a PAC margin of 7.3%. On a consolidated basis, PAC should have 18 crores for Q2-FI27 with a margin of 6.3%. For H1-FI27, standalone PAC should have 42 crores with a margin of 7.6%, while consolidated PAC should have 43 crores with a margin of 7.2%. For H1F527, our reported property also included an additional amortization charge of Rs. 8 crores arising from the goodwill amortization for the acquisition of Alcon. This is a non-cash expense. Excluding this additional charge, our reported property would have been higher. We obviously do get some tax benefit out of this as well, which will be strengthened during the merger as well, post the merger as well. Our net cash flow from operations for H1 and FY27 stood at approximately 54 crores compared to rupees 12 crores in the corresponding period last year, representing an increase of almost five times. This significant improvement reflects our continued focus on strengthening cash flow generation, improving working capital efficiency, and maintaining financial discipline, ensuring stable and sustainable cash flows as we grow our business. Now, coming to our segment performance for the quarter, our business continues to be driven by two key segments, infrastructure and concrete sleepers. Starting with infrastructure segment, segment contributed Rs. 262 crores. To revenue during the quarter, accounting for nearly 90% of our revenues. The performance was supported by higher execution across three projects like Prairie Rajunga Bridge, Kola Ghat, and Kona Expressway. This segment reported an EBIT of Rs. 33 crores, contributing to almost 92% of the overall EBIT, supported by improved execution and better margin profile. Our infrastructure order books were at Rs. 4521 crores, providing strong revenue visibility. During the quarter, during the period, Alcon, our subsidiary, secured multiple signaling contracts of Rs. 428 crores, and also, like I mentioned earlier, we secured an EPC contract of Rs. 484 crores from RVNL. Moving on to the concrete slipper segment. The revenue for the quarter stood at Rs. 30 crores, contributing to almost 10% of our overall revenue, while EBITs stood at Rs. 2.5 crores. This segment continued to benefit from stable domestic operations and a healthy contribution from the export supplies. Our Africa operations continued to perform quite well. The congressman segment recorded in our order book of Rs. 852 crores, accounting for almost 16% of the order book. This represents the highest order book in the segment, marking a significant milestone in the history of the company. Given the segment's relatively better margin profile, this is also expected to contribute positively to the company's overall profitability. We have also, during the quarter during this period, secured multiple smaller contracts for Panagal factory for export to Bangladesh as well as local domestic supplies. Overall, our infrastructure segment continues to demonstrate strong execution capabilities, supported by a robust order book, a healthy project pipeline, and an increasing opportunity in the railways engineering segment. The addition of alcohol is... We are further strengthening our capabilities in the signaling space and expanding our margin, our participation across railway infrastructure projects. The Board has also proposed an interim dividend, announced an interim dividend of rupees 1 per share, that is 10%, with a record date of November 11th. With this, I would like to now open the floor for any question and answers. Thank you. I request the moderator to kindly queue up the questions.

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 the attached phone 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 your question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. Participants, you may press star and 1 to ask a question.

First question is from the line of Vitej Bhagwati from Alpha Plus Capital.

Please go ahead.

Thanks for taking my question. So, sir, in last quarter, we conveyed our full year growth for this year will be targeted roughly around 30%. And now given our H1 performance, now to meet that sort of a target, we will need roughly around like 1,100 crores in H2. That's almost double of H1. So, what kind of confidence do we have as of today, given the order book in hand, and do we expect to maintain that or we trim our expectations?

So we are very, very confident of doing 1,000 plus crores in terms of H2 performance, which will take us to almost 25%. The guidance was between 27% to 30%, I agree. So we will be between 25% to 27% in terms of overall achievement for the full year.

Okay. Secondly, on our contract assets, they are currently at around 600-odd crores, that is 55 crores more from March quarter. Now that is on flat revenues. So two things I want to understand on this front. One is how much of it is more than a year old, and secondly, which sort of projects make the bulk of these contract assets, and when do we expect to build them?

So contract assets is almost 45 pros higher than compared to March in the last six months. This is an account of certain new contracts which have started, which we have secured, and which obviously the billing has not happened, like the Chambul contract, the Kashi Ganga Bridge, the... Rapti contract, etc., which have recently, we have bagged, and obviously, the first billing as soon has not happened, and we have spent almost that amount of money, 40, 45 pros, on those projects. And having said that, some billing has started to happen in Chambal, etc., in the current month, or last month, I would say October. So, this is our... This is a pointed project in any EPC company wherein newer contracts do lead to an addition in the contract assets. And in terms of answering your question about aging, I would say out of 543 crores, approximately 10 crores would be more than a year old, and the balance is all current.

Okay, fair enough. Lastly, if I can squeeze on the Alcon's performance, I just want to know what was our H1 performance, like revenue and EBITDA for Alcon?

So, Alcon revenue for H1 was almost 36 crores, and EBITDA has been close to 20% for Alcon.

Okay. So, given the order book in hand of 400 plus crores, we can easily, you know, surpass last year number of 130 crores, or how is it?

Yeah, we expect to do 150 odd crores this year in Alcon.

Okay, congrats, and again, thanks a lot for taking my question. Thank you. Thank you.

Thank you. Next question is from the line of Santosh Shifty from LCG Capital. Please go ahead.

Thanks for the opportunity. So, my first question is, the order book has increased from, like, approximately from... 5373 crores from like 4303 crores and Q1F27. So how much of this increase is attributable to the Managee Bridge and recent Alcon orders?

We have got almost 1,400-odd pros in this financial year, and the entire increase is attributable to those two contracts. So 385 pros is from the South African contract, large contracts, I'm talking about. 25 pros is from the signaling business. 484 pros is from the Mahana Henry business. And the balances are the smaller contracts.

Okay, and like earlier, management indicated that it was targeting 3,000 crores of order inflows and hoped to exceed the target. So, what is the current status of the bidding pipeline and how much has been secured so far?

So, like I said, we have secured close to 1,450-odd pros of contract in this financial year till now, and we are quite confident of exceeding the target of 3,000 pros for the full year. Our bidding pipeline remains strong. Obviously, we are bidding every day for new contracts, and we are quite confident of some of the bids that we have submitted that they should be, hopefully, in our favor.

All right. Thank you so much, and all the best. Thank you.

Thank you. Aras Abinz, you might have started and wanted to ask a question. Next question is from the line of Rajiv Chain from Arkan Wealth Investments. Please, go ahead.

Hello, thank you for the opportunity. So, I just have a couple of questions. So, your consolidated revenue growth remained modest at 4.6% year-on-year in Q2 FI27, while the H1 revenue was almost flat. Given the strong order book, when do you expect revenue growth to accelerate, and what level of growth should investors anticipate for the second half for FI27?

So, for the full year, we expect revenues to cross 1,600 crores. This would represent a growth of close to 25% in terms of the full year. This would entail a growth of almost 30%, close to more than 30% in the second half.

I understood, sir.

Almost 40% in the second half. This would be on back of the new orders that we've got as well as the higher execution from the existing contracts as well because, like I said in my opening remarks, the monsoon has been extended in this year because of El Nino or whatever, and that is leading to a better, that has led to a subdued performance in Q2. However, with monsoon subsiding, we expect performance in H2 to be much, much better.

Understood. Also, what quarterly revenue run rate would be required in H2 to achieve F527 guidance that we have already given, and is the existing order book sufficient to support this?

The H2 requirement is about 1,000 crores, like I said, which is almost 160-odd crores, and the existing order book of 5,300 crores is quite sufficient to kind of achieve that number of 1,000 crores in H2, and we are on track to do that.

I understand. And lastly, with the workforce availability now normalized, how quickly are you seeing execution momentum recover across key projects? And has the recovery already started in October, or will the improvement be more visible in post-quarter?

No, so recovery has already started in October. In October, we have started seeing significant billing. And also, we have due to strong realizations from existing contracts, our cash flow is also very, very strong, and that has led to a realization of some new world outstanding as well. And we expect the momentum to carry forward in the next balanced five months as well.

Understood, sir. Understood. That's all from my side, and all the best for the future quarters. Thank you.

Thank you. Participants, you may press star and want to ask a question. Next question is from the line of Pile Sharma from BD Capital Holdings. Please go ahead.

Hi, sir. Thanks for the opportunity. I have some set of questions with me. So, my first question is that the concrete sleeper segment contributed approximately 16% of Q2 revenue, right? So, like, what is the expected growth trajectory of the domestic sleeper business over the next few years?

I think over the next two years, the domestic business would grow by almost 15-odd percent, which is a significant number to be had. This is also both in terms of inflationary growth as well as increased production, and we expect the growth to be very strong for the African business as well.

Okay. Like, despite the order book being more than 4 times F by 26 revenue, H1 revenue growth remained muted. So, like, what is the expected timeline for converting the current order book into accelerated revenue growth?

So, a lot of the orders were back-ended and received in the last 9 to 10 months. Obviously, certain contracts do take time to pick up and start, and H2 will see the impact of that, and obviously, FI28 and Rai9 will also see the impact of that as well. We are quite hopeful that we will be able to convert these order books into execution in the next two, two-and-a-half years.

Okay. And my last question is that, what is the current binding pipeline, particularly the value of contracts, like where GPT has evolved as L1? So, like, when can investors expect the L1 opportunities to convert into the confirmed orders?

So, any project where we are L1, we do announce it to the stock exchanges, as we're asked, let's say. Currently, there is no project in which we are L1 in. And we will... Come back to the stock exchanges once we are at one.

Okay, okay. And of course, sir. Thank you so much. All your days.

Thank you. Next question is from Nanofarth Kotak from Plus91 Asset Management. Please go ahead.

Hi, Atul, sir. How are you doing? I hope I am all good.

Good, good. Thank you very much.

Sir, just one doubt about contract assets. So, I wanted clarification. Contract assets which are recorded in the balance sheet, that is essentially revenue already recognized or is yet to be recognized in P&M?

The contract assets includes a whole host of things. It includes Retention money, which is receivable from contracts from various clients. It includes Unbilled revenue includes price escalation as well. The unbilled revenue obviously over the period is recognized in the P&L, same for price escalation. And obviously the same goes for retention money, which is deducted from the bills, cash retention money of almost 100 odd grows, which has been deducted from the bills and will be released upon completion of the contract.

Right, sir, that's helpful. So, essentially, what I really just want to understand is the 500 plus crores of contract assets which are there in the balance sheet will be recognized as revenues during the balance of the year or has already been recognized as revenue and is yet to be receivable, I mean, from that perspective.

It has been recognized over the years, not in this year. It has been recognized over the years. So in this year... I would say the increase in contract assets is almost 15 to 20 crores in Air Force H1, and increase in unbuilt revenue, increase in contract assets is almost 45 crores, but that, like I said, improves also retention money, etc., but unbuilt revenue is almost 15 to 20 crores.

Okay, got it, got it, sir. I think that's helpful. Thanks.

Thank you. Next question is from man of Yash Mehta from Star Capital. Please go ahead.

That is, sir. Hope I am audible. So, I've got a few sets of questions. So, firstly, since the company has, like, secured a 385 crore order from South Africa, along with fresh orders from the eastern railways in Bangladesh, so, like, can you provide an update on the execution timeline for this project and also the expected revenue contribution, and along with that, the growth opportunities in both domestic and international markets?

Sure. So the domestic market for concrete sleeper, like I said earlier, would grow by almost 15%. This includes supplies in the domestic market in India as well as supplies to Bangladesh. And it is obviously on back of various orders that we are securing in India as well as supplies in Bangladesh, etc. In terms of the African market, we expect that to have an exponential growth because the 385 pros contract in South Africa would lead to a significant improvement in revenues for South Africa. So South Africa itself, we see revenues of almost 70-75 pros a year because this 385 pros is a five-year contract to be executed in South Africa. And, obviously, Ghana will also start contributing and Ivory Coast as well. So, all this will lead to a much better contribution from South Africa, and from Africa as well.

Understood, understood, sir. And also, like, what are the key risks associated with these international operations, particularly from currency fluctuations and geopolitical developments?

So, obviously, currency is a big risk, and with... What we call changes in political government do lead to risks in various countries, but I think that most of our contracts are well-protected in terms of crisis creation, and we are not affected that much by raw material prices that much.

Got it, got it. And just the last question, so like given the company's expansion plan, so does the current balance sheet have sufficient capacity to support the future growth?

Yes, yes. Our working capital cycle, we are trying to reduce, which is the reason why we are seeing better cash flows as well from operations. And therefore, the current balance sheet is able to support the growth for the entire operations.

Got it, got it. Yeah, that's helpful. Thank you so much. Thank you.

Thank you. A reminder to all the bar participants, you may press star and want to ask a question. Next question is from Nanos Sonia Raghuvanchi from Mirwa Securities. Please, go ahead.

Good morning, sir. Thank you so much for the opportunity. So, the management indicated that Algon could contribute approximately 120 to 130 crores in FY27 revenue. Has this outlook changed the following recent order wins?

Yes, so with the auto wins, we are expecting this year to be almost 150 crores, and next year to be close to 200 crores from Alcon, or 200 crores plus from Alcon, and this is obviously on back of the recent auto wins. This is something that is quite achievable, I would say.

Okay, so on that, with the acquisition of Alcon, GPT has strategically entered a high-margin railway signaling segment. Could you elaborate on the execution expertise that Alcon takes to the group, the key opportunities available in the segment and the current bidding pipeline?

So, again, the opportunity, like if you were to, I would refer you to our presentation, where we have given the entire gamut of opportunities in the railway signaling segment. It is an opportunity of almost $1.5 billion in terms of the current signaling market, and the current planned outlier of the railways is almost $1 trillion over the next six years. This includes, obviously, a lot of new signaling works, new track works as well. On the new tracks as well, we are addressing continuously bidding for new contracts, and we are capable to bid for contracts up to 200 euros plus in our own name. And post this merger, obviously, this will slightly go up because the network will boost, and we will be able to generate better revenues from Alcon.

Sir, GPT secured multiple railway signaling contracts worth 428 crores through Alcon Builders and engineers, along with a 484 crore EPC contract for the construction of a bridge over the Mahanadi River. Do these orders and send in the company's order book and revenue visibility over the coming years?

Yes, obviously, our order book is 5,373 gross currently, which is 4.3 times out of 526 revenues, and this gives us a strong potential to grow over the next couple of years, and we are also expecting further order inflows in this financial year. We are quite confident of the growth path that we have given in the previous calls as well.

Okay, so what is the expected EBITDA contribution from Alcon in FY27, and how much could it contribute to the consolidated EBITDA over the median terms?

The EBITDA contribution to Alcon is expected to be close to 30% or gross, which would be close to 20% of the expected revenues, and we expect Alcon revenues, Alcon EBITDA to be close to 20% going forward as well.

Okay, just last question for Mayan. During H1, what order in close does management expect, like, at the second half of the year?

H1 or H2? You asked H1. H2, H2, H2.

Yeah, H2. I'm sorry.

So, we have guided 3,000 crores for the full year, out of which 1,490 is already received. So, balance 1,500, obviously, we should be able to get in H2. Thus, we should obviously exceed that. So, we expect minimum 2,000 crores in H2.

All right, all right. So, that's it from my side. Thank you so much.

Thank you. Thank you. Next question is from Lionel Santos Shetty from LGC Capital. Please go ahead.

So, just a follow-up question. Does management expect an improvement in internal accruals and cash flow conversion going forward?

Yes, we do expect, like I said earlier, cash flow operations has been almost five times our last year number, from 12 pros to almost 50 or 55 pros. And we expect this year, full year, to be also quite strong in terms of overall cash flow operations.

And with the new West Bengal government having a strong mandate, so how does management see the opportunity for new infrastructure orders of the state?

So the government and the budget has announced a couple of new bridges in the state, which is almost 2,100 crores in terms of connectivity contracts, and we are obviously going to participate in those bridges, in those contracts, and we expect to back one or two of them.

Perfect, sir. Thank you so much for the opportunity. All the best.

Thank you very much. Thank you everyone for joining us today. For any further queries, please contact Cygnus Partners Private Limited, the Investor Relations Advisors to GPD Info Projects Limited. On behalf of GPD Info Projects Limited, we thank you for your participation. This concludes today's conference call. You may now disconnect your lines. Thank you.