Hindustan Construction Company Limited (HCC) Q3 2026 Earnings Call Transcript

Good evening, everybody. We'll be starting the analyst-investor call in a few minutes. Rahul, sir, are you ready?

Yes, yes, Sandeep.

Okay. Mr. Rahul Shukla, our CFO, will start with the presentation, please. Over to you, Rahul.

Sorry for the delay. Good evening, everyone. Sorry for the delay because of some technical issues. And we start with the presentation. Next, please. Just a quick refresher. We are a 100-year-old company. This year on 27th of January, we have just now celebrated our centenary year. And with our very strong credentials, we are now geared up to take forward this infrastructure in the National Building of India. We thank you all for your continued support. We have been receiving good support from all our stakeholders. And with this, we will just play a small video to take you through our journey. Moving forward, quick snapshot of our diversified order book. As of now, we have 13,000 crores of order book, well diversified across sectors and across geographies. Key highlights of this quarter. In this quarter, we have achieved 921 crores of turnover with standalone profit of almost 86 crores. We have continued to maintain very strong EBITDA margins of over 15%. That's what we will continue to do. We have been discussing in the past also that while our order book and revenue take some time to pick up, we will continue to improve operational efficiency and demonstrate good amount of EBITDA margin as well as improving PAD, quality of our PAD will continue to improve. In this quarter, we have secured two orders aggregating to almost 1,500 crores in joint venture with NFR. And in addition to that, we are also lowest bidder in 2,600, 700 crores of projects. We have submitted bids of almost 36,000 crores, which are under evaluation. And we have got very strong pipeline of almost 54,000 crores, where we will be submitting bids in coming quarters. We have successfully completed 1,000 crores of rights issue, which got 200% subscribed. We have also received 84 crore from our Steiner subsidiary H56 with the total receivables of 89 crore. Balance will come in due course. In our journey to us accelerated deleveraging, we have prepared 680 crores to lenders in this entire financial year, and we are also in the process of paying 876 crore. During this quarter by March, and we are hoping that with this payment, our substantial debt reduction will happen. Our debt will come down to 1950 crores, which was our target for this, this financial year. We have also achieved a reduction of corporate guarantee of HCC2 prolific debt. So we have talked about it earlier also. Now everything has been completed and documents have been signed. So this process is completed. On the operations update, things are moving quite well, and Patna Metro Rail Project, we had taken two projects, two packages, Package 5 and 6. They have been inaugurated by Chief Minister of Bihar, Mr. Nithish Kumar, and projects are progressing well. Indoor Metro Rail Project also, piling works are underway. You will see some photographs going forward, and work is well underway in all five stations. And excavation work-in-progress in airport station as well as Rajwada station. In Vishnugar-Pipal-Koti hydroelectric project, which is a large thousand megawatt project that we are doing, which is a large project which we are doing, we have achieved significant progress in tunnel excavation. And out of 12 kilometers of HRT, we have completed 8.5 kilometers. Work is progressing swiftly on other projects also. Agardanda Creek Cable Stay Project, Teheri Pump Storage Project, Vivupuri Pump Storage Project, all are progressing well. Now we will go to details of these projects. In indoor metro, certain photographs, dry rail rig assembly photo, as well as BSF Kalainagar station excavation work, filing work going on. Next, please. Patna metro inauguration photo, as well as casting yard development picture. In Agar Danda, a significant amount of marine work is going on. You can see photographs of piling happening, as well as segment casting work going on. This is the picture of Tehri pump storage project, wherein out of 1,000 megawatts, 750 megawatts is already generating electricity, and the last unit of 250 megawatts is also expected to be completed soon. Next. This is the picture of Vipuri pump storage project. You can see excavation work going on in lower reservoir. Next, please. On Vishnagar-Pipal-Koti, dam concreting work, progressing quite well. HRT we already spoke about. We have completed 8.5 km out of 12 km of HRT. On Tappavan-Vishnagar project, which is another hydro project in Uttarakhand, work in both phase 4 and phase 5 is moving on quite well. These are tunnels that we are doing there. And FRFC nuclear power project, nuclear project, again, block six and seven photographs are here and work is progressing well. These are the financials. So in this, I have already given key numbers and other numbers are here, which are also uploaded in the exchange. Next, please. And these are the consolidated numbers. Next. Now we will just take you through another video of our centenary year celebration before we open for question and answer. Thank you. Thank you. Thank you so much. Now we are open for question and answer. You can raise your hands and ask your question.

Please raise your hand so that I can allow you. Ajay Desai, you may please start.

Yeah, the question is to understand how this Shanti, which has come, is going to impact us and how quickly we will be able to get business and orders.

Yeah, Ajay. So, look, Shanti Bill, I think what it does is definitely paves way for the private sector to participate in nuclear power development and operation. So this definitely is a big step, and we are clearly seeing a lot of entities showing interest in collaborating, first of all, with HCC, given our nuclear-grade safety and quality performance, which we have done over the years. As you might be aware, we have already delivered more than 65% of countries' nuclear power plants, main plant construction and other related works. So, this definitely what we are seeing is not only the Indian technology, but also some of the other technologies like light water or maybe EPR. These are going to come into line. And next, in line with the government's plan of adding almost 100 gigawatt of nuclear power by 2047. It is very close to reality. I mean, even if we say 50% of that, it's a huge program which will unfold itself over next 10 to 12 years. And HCC being one of the front runners is well poised to participate in that. At the same time, we're also expanding our footprint into the allied sectors of mechanical and electrical and instrumentation works. So, by this strategy, we are going to be present in this market.

So, like earliest, the revenue we can start seeing from FY27?

No, I think this program to, I mean, as a result of this, what we foresee, that we will see actions on the ground starting somewhere in 2027-28, actual contracts getting placed. Because this will take some time for development of identification of sites, acquiring land, agreeing on the technology, and post that only we can see these works actually coming to the ground. So, you can see something coming from this, maybe from early 28.

Sure. Thanks.

Thank you.

Mr. Kunal Tokas, you may please start.

Hello, am I audible?

Yeah, yeah, go ahead, please.

Okay. Thank you. My first question is an accounting question. As I see on the balance sheet for FY25, because those are the details that I have. Your advances from contract T stand at around 1,000 crore rupees. And please correct me wherever I'm wrong. But your interest due on these advances to get 345 crore rupees for a 525 end. So just wanted to understand why it was so high in relation to the amount of advances. And what is the interest rate that you pay on advances from contract T?

So, we pay very nominal interest on contractee advances, which generally goes around bank rate plus 2% kind of thing. And not every advance is interest-bearing. Now, though, most of them are interest-bearing. So, what interest accrual you are seeing are in one or two projects where the repayment has not been due or necessary at that point in time. However, we are also working about towards settling those advances with clients because there are certain receivables also in those projects. So once those settlements complete, you will see significant reduction in these client advances in comparison to FY25. However, in continuity of our business, we will keep on acquiring new orders and there will be more client advances which will be coming as a virtue of contract. So that number may not be comparable, but yes, as far as historical advances are concerned, they will reduce very significantly. And when they will reduce, they will reduce along with their accrued interest. So that will get settled once those things are.

So, if I understand correct, there were some advances which are sort of on limbo, but continue to accrue interest. And that is why, and first of all, also, are my numbers correct? 345 crore for interest and 1,000 crore of advances for FY25. 345 for the period and 1,000 crore as on 31st March.

I think what Kunal, the... Team is checking the numbers as you are speaking, and what I think, Ravi, I think, is it, I think your numbers are correct, and I think maybe. Ravi Jain, our deputy CFO, or Rahul can take this up with you offline if required, if you need some further reconciliation. But I will add one perspective. Typically, client advances over the life of the project will be recovered through the cash flows of the project, and the project will basically close with no liabilities. What happens when project delays take place, you know, is where sometimes a client also basically allows for further ad hoc advances until such a time certain bills and certain claims are settled. That has happened in the case of one or two of our larger projects that are now probably in the next year, year and a half closing. So in fact, we have large independent engineer related awards and receivables against which those client advances will be squared off. You know, typically there is a process and there's a lag within which period these things do happen. And the expectation that we have is that these projects will get closed, you know, with those. In fact, there were certain projects. Certain hydro projects that actually went through a period even during COVID when certain large unusual delays took place. And so as we close a couple of these large hydro projects over the next year and a half, you will see a substantial amount of this debt basically come off our balance sheet, which is actually today flowing through our P&L in terms of our finance charges as well. So that will be a substantial increase in the bottom line on our PAT when that happens, because this, in addition to our bank debt, is another reason why our finance charges are actually a little on the higher side.

Yes, that is exactly what I saw. Now that you mentioned the hydropower project, in the last call, you had said that one was stuck in Maharashtra. You removed it from L1, which...

That is a project that was not even awarded for which we didn't even begin any work. So that's not relevant to this discussion. There are projects that we have, hydro projects that we have in Uttarakhand, you know, that because of some various issues that we had in Uttarakhand, including, you know, COVID, then we had certain landslides that took place. There was court orders that prevented work from basically continuing. So there are one or two projects that we have that have faced an unusual delay. In fact, there's only really one. And I think when that basically closes out about 18 months from today, you'll see a substantial amount of this go off our balance sheet.

Yes, thank you. My question was concerning the hydropower project. That's related to your L1 position.

We have a project in New Gandharbal, which is basically an L1 project, which has been L1 for a while, and we expect for that to actually now be converted quite soon, you know, so. Okay. Please stay tuned for that, you know, in, in this, in the, in the, in the coming months.

Okay. I understand. And the other question is regarding PRPL, you have reduced your PG guarantee, and the payments start from September 26. So how is progress towards that resolution of awards checking in PRPL?

So PRPL September 26 is already prepaid. And so, okay. Yeah.

Okay. Okay. And then it will progress on a semi-annual basis. No, it's annual. Annual. Yes. Okay. And also in the consolidated segmental accounts. Uh, if we look at this segment called others, which contributed just 83 lakhs to top line, but there's a 84 crore to be charged in the habit against this other segment. Can you explain that a little bit, please?

Okay. You are in console. You are talking about console numbers for console segmental numbers. Okay. So, you are talking about 83 crore number that is charged there?

Yes, against the others lying items. These specific items we can discuss in this section.

83.72 crore. I think, Kunal, if we can just limit everybody's questions to two per question, maybe get back in the queue, we'd appreciate them. There's a lot of people basically, you know, ask the question.

Okay, thank you.

Rajesh Bhandari, you may please start. Please unmute and start. Rajesh. Rajesh is not suspending. Any more hands? I can't see any more hands raised. Please raise your hands. Okay. Can you may please start?

I'm sorry, there's a lot of ambient noise. You need to please be clear with your question or we'll have to go to somebody else.

Difference in consolidation and strength of numbers. In profit side.

Yeah.

So I wanted to know what was the reason for our consolidated profit being down?

I'm sorry, your question is not clear, you know, and so maybe if you can, I'll request my CFO to touch base with you offline, and we can have this question answered later, please. If they, if it is, if it is relating, if your question is relating to why there's The difference between the standalone and the console numbers. In fact, I, you know, this is probably something I should. Hello. Yes, I was basically pointing out that we've actually had a very positive development in the settlement of a substantial... Est while Steiner related receivable. In fact, these were matters that we were expecting receivables that we were expecting to have come in in the next, you know, two to three years. But we've managed to close one well in advance. And we've taken a minor write off on that to in trade off for the substantial cash flow that comes as a result of that. So that's perhaps maybe where you see that particular item because we've got a number of receivables associated with a few counterparties.

Hardik Chheda, you may please start.

Sir, I just want to ask other expenses have gone up substantially, why, why, and quarter and quarter, the reason for the jump in the other expenses, and secondly, first you can answer that, then I'll ask my second question.

So other expenses has gone up by almost 20 crores quarter on quarter, and that is essentially we have settled one large tax-related dispute. So wherein it was a very positive outcome, 157 crore has got settled. So that has resulted into 20 crores of book losses. That's why you are seeing that number. But that is one time.

But sir, in the consolidated, it has gone up even more. On the consolidated basis, it is even more, it is up even more sharply. So the reason is only tax or something else?

So other, we just now explained with regard to our settlements wherein cash has been...

Yeah, that I understood. So it is because of that only, right? Both, okay. Yeah, both put together, yeah. Okay, perfect. And sir, just wanted to understand little more on the nuclear power side opportunity apart from the Shanti which was launched. Apart from that, in the near term, any other opportunities in the nuclear power space which you can expect in this year? Any orders, any L1 or anything?

When you say this year, I'm treating till December, right? You know, we are clearly seeing that NPCR will come out with some tenders for their PHWR program, specifically Mai, Banswara, and Chutka. These two bids are going to come out in the next four to five months. And, you know, we can expect that those orders will get decided.

Okay. And how large will be those orders? Roughly, sir, the bid size?

Mahi Banswara and this, if they're going on fleet mode, it will be like each order would be close to 8,000, 9,000 crore.

Okay. Okay. And will you be bidding for the whole part? How much will we, in terms of percentage, can you just say?

So, look, the civil constitutes almost 40 to 50% of this valley, the civil works.

Okay, great. Thank you, sir. Thank you. That's very helpful. 8 to 9,000 crores each, you said, right? Both 8 to 9,000 crores. And 40% will be the civil and that part. Thank you so much, sir. Thank you. That's all from my side. Thank you.

Lokesh, Lokesh Kashikar, you may please start.

Yeah, hi. Thanks for the opportunity. A couple of questions from my side, basically. So just wanted to understand out of this 13,000 crores of orders you have, so how much is basically slow moving or yet to start work on those projects?

Look, I think, in fact, there is none is slow moving here in this entire 13,000 crore. We have secured 20, almost 2,500 crores of Patna metro, which has just started. And even indoor metro is in the initial takeoff stage. So that's another 1,200 crore. All other jobs are, and of course, we have also secured some orders in the railway sector recently, around 600, 700 crores. So these are in the off-tech stage, you know, remaining else is ongoing works.

Okay, okay. And, sir, we were basically targeting around 10,000 crores of projects in this year. I understand that we have got around 3,500, 600 kind of numbers at YDD levels. So, where do you see that the order inflows basically settled down for FF26? And what is your expectation for FF27 as well?

So, Lokesh, I think I will not be able to help you with numbers specific because these are forward projections and we would not like to do that. But I can give you some sense. Look, we already have a position where our order intake as on date, if I speak, will be around 3,800 crores. We are holding L1 position of another 2,000 crores. And there are bids almost worth 9,000 crores which are under evaluation. We expect, you know, to be successful somewhere. So you can take, you can, you can consider some percentage around that, let's say 20%, 25%. We, we think somewhere around that we should be able to close that.

And I think one thing I, one thing I want to add, I think that there's some of the, most of the jobs that we are looking at now are in that sort of thousand to three thousand crore range. And so there will be some lumpiness. And so, you know, what certainly the shortfall that we basically have on a quarterly on a fiscal year basis, we certainly look to make up within the next basically three to five months, right? And I certainly expect that while there might be a little bit of shortfall year to date, I think that it's highly likely that we should be able to make that up in the coming months.

Okay, okay. And sir, on revenues, if you can just qualitatively, if you can.

I'm sorry, just one more point I'd like to make on that subject without giving sort of forward guidance is that there are a number of jobs in which there are, we are in discussions with clients and we are in negotiated discussions with clients, right? So maybe we have a certain positivity with regard to how some of those discussions will actually unfold in the coming months.

Okay. Last one from my side. We have basically declined on the top-line front, understandably, because we have got lower inflows as well. So, contribution was lower. But I just wanted to know, our long-term target is around 15% to 20% CAGR. We want to get to grow. So, do you think that will basically start with FF27?

Yes, and I think we should certainly try to exceed that. I mean, certainly our order backlog growth should be substantially basically higher than that in terms of growth. And the turnover from that will obviously flow depending on when the projects mobilize and get moving. But at least, you know, from our investment community, you would have a very, very good visibility of what the earnings will look like for the next three to five years as we start to build this up. So one thing that Rahul did mention in his initial remarks, which I wanted to just reemphasize, we are entirely basically along with top line and because that will drive ultimately the exponential growth that everybody's been patiently waiting to see. But effectively, we will continue to generate strong margins, you know, as one, our operational efficiency has increased. But at the same time, the quality of the work that we're doing is continuing to improve, along with some of the major settlements that we expect to conclude with our clients for closing projects. So a combination of these three factors along with our deleveraging should actually see our profit margins actually in the short run be higher than normal. So while our top line. May continue to be constrained until the order book flows into sort of a top line. Our expectation is that our margins will actually, relatively speaking, be stronger in the short run.

So that helps, sir. That's it for myself. Thank you.

Harish, Harish Yad, you may please start. Hello. Yes, Harish, we can hear you.

Good evening, and thanks for the opportunity. I went to, during the presentation, there was no mention about the BKC bullet train update, and there was some media report that work has been stopped due to pollution problems. Can you just give us an update on that, sir?

Thank you. Harish, see, Bullet Train project is ongoing at a good pace, I will say. Definitely, there are some slowdowns due to issues mainly with respect to the restricted working hours, and that is why, you know, the progress has not been able to achieve to the desired pace. Also, there are some interface issues with the adjoining contractors, you know, how there are some planning related issues with that. But, but it's not, I mean, I think that's not a correct news that the work has stopped there.

No, no, but it came in a media act that Mulchipati has stopped the work over there.

That was long back, and that happens for one or two days, when the AQI goes very high and all these things.

Okay. So what is the expected date of completion of this project?

Right now it is 29, almost April 2029.

Okay, okay. Any more package from this project, bullet train, you are expecting?

See, the Mumbai-Yamdabath line is almost awarded for every package, but now you might have read in the newspaper that there are seven more bullet train projects which government... That is a long way, that is a long way to go. Exactly, so whenever, you know, that's there, we will focus on that.

But here, although there are some underground tunneling work to be done, so that is already awarded?

Yes, to AFCON. Okay, okay.

Thank you. Thank you very much, sir. All the best.

Thank you.

Ajay Desai, you may please start. You have more questions?

Yeah, sir, I just wanted to understand this. My Baswara and other project which you talked about saying 8,000, 9,000 crore each. If you can give me a little bit more understanding about these two projects.

So, sir, sorry, Ajay, these projects are basically, you know, they are PHWR program. They're all 700 megawatt reactors. What the government is going to do, in line with you, you might have seen the bits of CAIGA, NPP beforehand. There are going to be six units which will be tendered together with all the ancillary equipments, MEP, main plant and equipments. That's going to be the package. And that's why this package size will be bigger in nature, what you have traditionally seen.

And this will like bidding will start. So effectively, the execution will start when whatever we get of contract

execution will start in August or October 2027.

Okay, August and October. So it will start at that time. Yes. And I have one more question from investors' point of view. Like, you know, the market cap, which was pre-write issue, post-write issue, and, you know, how do you evaluate that when you look at it? Basically, the investors, you know, the change in market cap between pre-write and post-write effectively are sitting at loss. So, what's your view?

I can't. No, I think, see, I mean, you know, it's a function of how the market is reading the current situation, but I think it's going to improve.

So, look, I think, first of all, there's two things here. One, I think it's technically, I think, and mathematically, pre- and post-money situation, you know, the market cap should actually adjust for the fact that there are obviously more shares and you have. A subscription. Now, I think that we have to probably take into account folks that decided to... Arbitrage versus basically, you know, people that were long term investors. And I think that, you know, the rights issue certainly benefited a lot of our long term investors that subscribe for additional shares, and actually got them consolidated their positions. And, you know, I think that our goal is to actually build a larger, stronger institutional shareholder base. Um, and perhaps maybe the, uh, um, and look, I don't think that we want to comment on why our market cap either moves up or down, right? I think that what I will basically say from a positive standpoint is that we certainly look to deliver a substantial, you know, value to shareholders as we really grow our order backlog. And that's something that I feel very positively about in the coming months.

Sure. Thanks. Can you have any additional questions? You can unmute and start.

Sir, I would like to know whether on the private side, sir, we're telling about negotiating contract with some big players. So, I would like to know in which industry we are, in which segment we are discussing.

So, Ken, look, we are talking about renewables and renewables of, you know. Both nuclear and hydro form, that's one part. We are engaged with the private sector.

And hydro includes pump storage.

Pump storage, yeah. In addition to that, the minerals and metal sectors are where, you know, we have, again, we have picked up pace and we have just, we are working on some project right now for Hindalco. We are definitely seeing a lot of traction there. And we are again engaged with the, you could say, the leading players of that sector. And we believe, you know, we shall be in a position to convert some good orders over there.

We are also, we've identified two regions abroad where we have an interest to actually work in the medium to long term. And we've made, you know, fair amount of headway in terms of establishing a presence with, with hopefully the beginning of some new business, which we will basically communicate at the appropriate time.

Understood. And sir, one more question. There was one big order, hydropower orders, bit coming in Anomaka. So what's the status for that?

So, this was Dibang, and we have lost that bid. I can say some of the industry players have gone ahead with a very, very aggressive bidding on that project. And we continue to maintain our bidding discipline after analyzing all the risk associated with such a large job. So, we have not been successful on that bid.

Under. No problem. Thank you.

Kunal Tokas. You may please start again. You have more questions?

Yes, please. Thank you. A question about you. You obviously expect to grow very fast. Do you think labor can become an obstacle to that growth?

Yeah, that's an industry issue. You are right. I mean, labor is a challenge for the entire industry, and I think... So we will have to factor this into when we are looking at growth. The solution to that is going to be some of the captive training which we have to do, some very, very innovative retention programs with the labor workforce. We are engaged on that. But yes, we will have to live with that problem, and I think we'll have to work around it.

Well, I think the one other thing that I would like to say on this front, I think that I think that HCC has. And I think the respect for our labor force and the quality of our labor camps and how we treat our labor and at least what we consider to be the joy of working within HCC is something that we tend to basically feel fairly strongly about. So, that... Certainly helps. But, you know, we all know that there's a there's a stretched demand supply situation in the country. So, yes, I think what Santosh has said is something that we continue to be cognizant about in terms of, well, how do we better manage with our labor, with our partners to ensure that at no point in time we have our cycle times disrupted by labor disruptions.

Thank you for your answer. And also, did I hear correctly get to say you're evaluating two international destinations to be working?

Sorry, we couldn't understand this question clearly.

Did I hear you correctly saying that you were evaluating two foreign destinations to be working? Yes, that's right. When you divested of Steiner, did you also not say that you were satisfied with the amount of opportunity available in India and wanted to focus just here?

Yes, but Steiner was in a different line in building construction, and so I think that our goal, and we still maintain that, is that our core business of engineering construction is where our focus area is, period. Where we see clear high margin opportunity and where we've actually, frankly, in some cases, been invited to work and provide our expertise in a couple of regions is something that we are evaluating, and this is something that we don't see as a dramatic shift or distraction from our core area of working. This will always account for a very small portion of our order backlog, but then could tomorrow become, you know, could complement basically, you know, our work and our diversified order book and our margins as time goes by.

In fact, we are taking out on the best strength in new locations.

That's good to hear. I was just worrying that it might not become a stretch on the working capital, given that you...

No, I know we're very clear. Look, I think that, you know, we're blessed with a lot of opportunity in India. The government continues to be focused on infrastructure spend. And at least for the number of years to come, we will always have tremendous opportunity here. But we will look very, very opportunistically at a couple of, you know, just because we mentioned international is not because we don't see opportunity in India, right? You know, it's sometimes the quality of the work, the quality of the client, the pre-qualification that comes with that and the high margin basically that comes with that is something that is something that we don't turn a blind eye to. And certainly this is not something that will require any material investment. We're very clear about a wise use of our capital in the short to medium term.

I'm glad to hear your thoughts and excited for this next phase of your journey. Thank you very much. Have a good time.

Thank you.

Hardik Cheda, you may please start.

Yes, sir. I just wanted to ask regarding the margin for the next year. Do we see margins remaining at the same level or now do we see the margins going up?

I think I've already commented on that. I think that it would be unfair to probably see anything further.

No, I don't want to exit. I missed that part. I just wanted to understand, Madhulab. Let's say not about next year. In general, the margin trends, are you seeing them going up from here for the forthcoming orders that you'll execute or staying in the same range around where they are? I'm not asking for exact numbers.

I think if you're asking from a job-specific standpoint, I think we will continue to maintain our discipline of, and we've always maintained the position that the kind of work we do is in the mid-teens EBITDA margin category. As you see our debt come down, and our goal is not just by the end of fiscal 26 to see the debt come down to sub 2,000 pros, but to actually have the company completely deleveraged as early as possible. You know, in the next basically, you know, two to three years, we want to be debt free. So that along with basically the client advances being adjusted, the kind of works that we're picking, at least, you know, Rahul talked about the fact our diversified order book. As well as, effectively, the fact that we work across the country allows us to actually... You know, see through cycles, right? Whether it's in a particular sector or in a particular region. And to some extent, because of our pre-qualifications and the complexity of the works we do and the appreciation that the clients have for our work, we tend to actually not have competition in more than basically three or four players in the spaces we look at. So combination of all these factors is going to, I imagine, maintain the quality of our margins. Okay. And, you know, and so certainly don't think that you should be disappointed on that front. Okay.

And let me just put it that way. This I got it. And with the opportunity in the nuclear space, say I'm not asking six months, say two to three years down the line, could that substantially take our margins up from the present level or even after that the margins you are expecting to remain same or that could be a changer in terms of margins?

The answer is yes. Yes, it's a simple yes. And it's a function of two things. It's a function of the quality of work, but it's also a function of scale.

So, okay. Got it. Got it. Thank you, sir. Thank you. That answers my question. Thank you.

Thank you. H.S. Reid. H.S. Reid, you may please start. Yeah.

You mentioned about this Dibank 3 project. So if I'm not wrong, Patel Engineering and your group were there. So who has actually finally won this?

I'm sorry, who is what? A company by the name of Hrithvik has won the project. Oh, is one the project, but he is the lowest bidder, right? Is the lowest bidder.

But, sir, do they have any track record or something? Because the technical things are also the same.

Look, we are not in the position to comment on our competitors or peers or any other company. That would be certainly unfair.

Okay, okay. I appreciate it. So, I think you need to do your own diligence. No, I agree, sir. Thank you so much. I just wanted to ask, because I'm missing, I might have missed it.

It's a question, it's a question you can ask NHPC in your next, in the next analyst call.

I just wanted to ask one thing, like the guidance, because we are shareholders for a long time now. What kind of thing we can expect in the next two, three years? What kind of guidance you can give us? Because all these rights issues and everything is over, financial restructuring is over. So what we can look up to now?

We've seen, I think, this past year, you know, there's been a higher level of competitive intensity. I think that what you will certainly expect is, at least from HCC, you will not expect us to make a mistake. You'll expect the highest qualities of basically, you know, health safety environment. I think that that's something that when the industry goes through cycles, you know, people basically appreciate that at the end of the day, and certainly our clients do. As far as now coming down to what investors care about is growth and growth in earnings and return on investment. And as far as we're concerned, I think that one, I already spoke about the deleveraging and the substantial growth in earnings that will come from that. That's one. But as far as turnover is concerned, we said this in prior calls that we want to see a doubling of our turnover every three years. You know, ultimately, we want to, on such a low base, I think it would be certainly a disappointment for us if we didn't basically grow at 20, 25% a year, right? And that's now a function of us building an order backlog and really kind of, you know, having those numbers translated into free cash flow. And what we requested in the past, basically quarters, is that the analyst community and the investor community overlook this period, during which time, you know, we've been looking to basically do our business. I have said this on our last analyst call that I've been a little disappointed at the speed at which we've done that in this past year. But I certainly look to make that up in spades. So not only will we look to make up for the last year, but we look to basically accelerate that along with this year's, you know, fiscal, and I say fiscal 27 basically plan, right? So I hope that gives you a sense as to the ambitious plan that we have. And, and I appreciate the patience that, that people have had in us basically achieving this task.

You're giving this big pipeline of 53,000 crores in your presentation. So I, I, I could not attend that initial part of your presentation. So I am sorry for that at the outset. If, because you might have expressed something, can you just tell me now, which are the main projects in that, and what is our probability of winning them?

We don't, we don't go into the bid pipeline in terms of project by project. And, you know, certainly what you can expect is that the, is that we have. We have been in our areas of core competence, right? I think if you look at our diversified order book, where, you know, you wouldn't be that surprised to effectively see that most of our pipeline, the work we've already done, and the work we plan to do is actually in that. Now, let Santosh basically add to that. But I think, you know, we look at generally speaking a 15 to 20% hit ratio. I mean, that's what we target. And I think that in some cases, I think we'll actually probably maybe even exceed that, where there are jobs in which, where the competition is lower, and where one of two or three players that, you know, is earmarked to kind of, you know, win the job.

So, I think just to give you a feel, this bid pipeline, which is there, majority of the bids are coming from hydropower sector and urban transport sector.

So, sir, our hit ratio, if it is 15%, let us say, then it translates into only 5,000 crores. I mean, maybe 7,000, 8,000 crores.

Yeah, 7,000, 8,000 crores.

So, that takes care of only one year, hardly one year, because now we are going to grow at 25% also.

Yeah, but this is in addition to whatever we have secured already. Yes.

And by the way, this pipeline we're talking about is what we're talking about currently. Now, in the next three, four months, that pipeline will continue to grow, right? Yes. So for us, the definition of pipeline is a project that we are getting very near ready to bid for, as opposed to the identified numbers. It depends on how we define it. Uh, the, the 50,000 crores is not a, is not a definition of a fiscal 27. It's basically currently, you know, what's on our slate and what we plan to basically look to focus on.

Okay. Okay. And that 35,000, which is mentioned above is like order book? Is bid submitted. Bid submitted. So, there the hit ratio would be 15% of this.

I mean, again, to be very honest, I, you know, I'd like to withdraw the comment of 15 to 20%. I mean, look, I think that we…

Yeah, just for understanding, sir. I appreciate it. I appreciate it.

We think about that from a growth allocation of capital, you know, capacity perspective. It obviously could be much higher than that. It could be slightly lower than that. Now, certainly, we don't expect it to be lower than that, but it certainly could be higher than that, in which case then we have to, you know, obviously have the accelerator capacity to, you know, to execute that. Okay. Thank you, sir.

Thank you so much.

Thank you. Kunal Tokasimi, please start.

Thank you. I just forgot to lower my hand.

Thank you. Okay. Pranav, you may please start.

Hello. Am I audible?

Yeah, yeah. Go ahead. I'm clear, right? Yes, yes.

Yeah. Sir, like you said, I mean, looking at our past results also, I think being consistent and proven ourselves when it comes to having the margin that we wanted as a company. Right, and we've started showing the results when it comes to the, you know, getting our money back, receivables, clearing our balance sheet. So just one thing, for the last three, four quarters, we've always been talking on the order booking side. Where is the lack or where is the lag that is happening? Is it from the government's end? Is it from our end? Or is it? You know, environment, business environment as such.

I don't think that first of all, that we can place the blame on the government at all. I think the government is doing a wonderful job in bringing a very large infrastructure pipeline to market. I think that perhaps maybe as I've said this in the last quarter, perhaps a little bit of ill luck on our part. We had 5,000 pros of L1 jobs basically in our order book, which were Maharashtra basically jobs, which were then cancelled or retendered, right? So then we went sort of back. That should have theoretically today been in an LOA position, which we could have executed. And I think, you know, to be very frank, I think it's a function of us not having executed as quickly. There's no other excuse for that. I think that there are, yes. You know, we tend to look at, we're looking at fewer bids, but larger bids in terms of size, 2,000 to 4,000 crores. So, there's a greater lumpiness in our order backlog. Hopefully, there will be one or two quarters where you will be surprised with a substantial order. So, for example, Dibang was a bid that was 15,000 crores. I mean, it would have gone that doubled our order backlog. Now, I don't think that there's any excuse, but effectively our own performance in terms of generating that order backlog. Very simple.

Okay. Okay. So then the path going ahead because now our balance sheet can basically support a lot of larger orders and more orders to us because we are technically at the lowest debt in our last 10 years history. How are we go, how as a management hand, what do you see our company becoming in the next four to five years? I mean, where will our niche be or what is our moat that is going to be as a company?

I don't know. I mean, are you asking from a financial standpoint? Are you asking from a positioning standpoint?

No, no, no. From a promoter's standpoint, what do you see our company becoming or what is our niche that we are going to create or probably, you know, that this is the segment that we are going to have our foot in like an elephant or, you know, cement our position there that whatever orders we, whatever tendered or order that we get.

You know, the one thing that we have been blessed with is that we've been blessed with a 100-year pedigree in having actually done landmark projects for the nation. You know, there's been projects of incredible difficulty and complexity, which have not just basically helped contribute to the economic growth of the country, but also basically been associated with strategic areas in defense, etc., etc., right? So, as far as we're concerned, we will continue to work in our core areas of expertise. I think you're already aware, you know, that we've done nearly a quarter of India's hydro. Out of the 24 nuclear reactor buildings today, 14 have been built by HCC. I don't think they need to repeat our credentials on the tunneling front in terms of even building some of the most complex and most impressive bridges. Right. All for that matter, Strategic projects like, effectively, the dry dock for our aircraft carrier or the strategic oil cavern reserves, you know, where our crude oil basically rests. So I think that we will continue to embrace complexity. We will continue to take on projects which... And I think that you will not notice probably more than a few competitors in the field that we basically continue to compete in. Does HCC need to regain, you know, yes, HCC has a lot of these landmark projects to its name, but financially speaking and in terms of the size of our business, are we sort of, you know, today, do we today in the next five years, if you ask me, do we need to regain our place among, you know, as one of the largest Thank you very much. Most successful and financially successful companies in India doing large complex infrastructure projects. That's certainly basically where we need to be and they're where we will be. And that's basically our goal.

Okay, okay. And our plan to reach there is basically keep bidding and showing our complexity historically.

Yeah, it's simple. I mean, it's a matter of remaining, keeping, like I said, the most important thing is being true to who we are, the integrity with which way we work. We're a professionally driven firm, and we will continue to maintain that discipline in terms of taking on commitments responsibly and executing them with the highest standards of basically equality and safety. And, and just that's right. I mean, we just need to do much more of what we've done before.

Okay, okay. Thank you so much.

He run kr. Kieran, what are you, mister? Kiran is not responding. Naman Praman. Naman.

Hello.

Yeah, you can start.

Oh, yeah. Hi, sir. So my only question was regarding the profitability. If we see on a standalone basis versus the consolidated basis, there has been a reduction. So I just wanted to understand the reason for the difference. And is it a one off or how should we see it on a future basis?

So Naman, we have already explained this. And it's one-off because of a couple of items which I have explained. So maybe you can refer to my comments there, please.

So.

Start by the way, start by the way.

Sandeep, are you…

Hello. Hello.

Hello, yes.

Yeah, thanks for opportunity. I have two, three clarification to ask. One is about the promoters are having some sales, please. And so what is the roadmap for that? And second thing? Are we planning to have a stake in the company because it's only 16-17% and third is, did they subscribe to the right issue recently and could it?

I'm sorry I didn't really understand your last question, but I think that, look, as far as the promoter group shareholding is concerned, you know, you have the facts. I think the goal is to obviously have as much of the shareholding unpledged as possible, and, you know, that's the goal. I can't comment beyond that at this point, but we will share that information basically with your due course. And the promoters basically not only subscribe to their portion, but actually oversubscribed as far as this part, as this rights issue is concerned. I think that what you can expect in the near future is our plan to try to basically raise the shareholding. At this point in time, I won't say anything further on the subject. You can please, you know, stay tuned for what our plans are in that regard.

Yes, sir, but this preaching is a surprise. So, what is the role for that?

I'm sorry, your question is not clear. In any case, I'm

talking about the pleasing of the sales by the promoter is supposed to be a bad sentiment on the stock price. So, what is the roadmap to remove the preach of the promoter?

We can't comment on that, Arish. This is not the appropriate forum in which I will comment on that. What I will say, and I will repeat again to you, is that there is a clear plan to basically do that, but unfortunately, I will be unable to basically be explicit on this analyst call.

Okay, okay. Thank you. Thank you very much, and all the best.

Thank you.

Sir, there are two more handrails. Rajesh Bhandari and K. They are repeat. I am allowing Rajesh. Rajesh, you may please start. Have you raised your hands or it is by mistake?

Sandeep, I think, you know, they have just not put it down.

Yeah, yeah, yeah. So I think most of things are answered. Raoul, sir, you may please close the call.

So now that there are no questions, we will close this call. Thank you all for joining and making it a fruitful discussion. Goodbye, and see you next quarter.