Laser Power & Infra (NSE:LASERPOWER) Q1 2027 Earnings Call

0:00 Ladies and gentlemen, good day, and welcome to Laser Power and Infra Limited q one f y twenty seven earnings conference call hosted by ICICI Securities Limited. As a reminder, all the participant lines will be in a 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 in operator by pressing star then 0 on your touch tone phone. Please note that this conference is being recorded. I now hand the conference over to mister Joshi from ICICI Securities Limited. Thank you and over to you sir. Yeah. Thanks,. On behalf of ICICI Securities, we welcome you all to q one FY twenty seven results conference call of Laser Power and Infra Limited.

0:53 We have with us today senior management represented by mister Goyal, chairman and managing director, and mister Amit Kumar Goyal, CFO. I congratulate the entire team of LASER for a stellar listing, and now hand over the call to the management for initial comments on the quarterly performance. Post that, we will have q and a session. Thanks, and over to you, Deepak, sir. Good morning, everyone. On behalf of the entire Laser Power and Infra Limited team, I welcome you to our first earning call as a listed company. Our listing in July 2026 marked an important milestone in our journey that began more than a decade of more than three decades ago.

1:41 I would like to thank all shareholders for the confidence placed in our IPO. We value this trust, and we recognize the responsibility that comes with it. As we begin this new chapter, our focus remains on disciplined execution, prudent capital allocation, strong cash generation, and sustainable value creation for all shareholders. Since this is our first earning call, I would like to spend some time explaining how our business works, how our manufacturing and EPC capabilities come together, and where we see the next phase of opportunity.

2:30 I will then cover the key operating developments for the quarter, following which Amit will take you through the quarter one financial performance and the IPO capital structure. Laser Power operates across power transmission and distribution value chain. We have two principal business segments. The first is manufacturing. We produce cables, conductors, and specialty products used across transmission and distribution network. Second is our EPC. We undertake power distribution infrastructure projects covering supply, installation, testing, and commissioning, and final handing over.

3:18 Over the years, we have steadily expanded our capability across across this value chain. We source key inputs directly from established primary producers, undertaking significant processing and manufacturing in house and supply our products both to third party customers and to our own EPC projects. This integrated model is central to the way we operate. It gives us greater control over quality, material availability, and delivery schedules. It allows our project team direct access to products manufactured within the company, helping us coordinate with procurement execution more effectively.

4:09 For our customer, this means dealing with a partner that understands both product and its final application in the network. For laser power, it means participating across a large part of the value chain rather than operating in only one product supply or only as an EPC. Our manufacturing operations are supported by three manufacturing units with an aggregate installed capacity of around 85,000 metric tons. Their locations give us access to major sources of raw material like aluminum, steel, and polymers, along with proximity to port and transport infrastructure.

4:55 While our manufacturing footprint is in Eastern India, our business is not limited to the region. We supply products and execute projects across the country for state electricity distribution companies, utilities, Indian railways, and the private sector EPC players in addition to international customers. Our manufacturing and EPC business have different operating cycles, but they complement each other. Manufacturing is a shorter cycle in nature. Existing orders are manufactured, dispatched while new orders continue to replenish the pipeline. This cycle generally ranges between three to six months and through the actual period depends on product specification, customer inspection and delivery schedules.

5:51 In the manufacturing, the closing order book is only one part of the picture. As we execute and dispatch existing orders, fresh orders continue to enter the pipeline. It is therefore important to consider order inflow and execution together rather than looking at the closing order book in isolation. Our EPC business has a longer execution cycle, a project progresses through procurement, supply, followed by installation, testing and commissioning and final handover. The timing of the revenue, billing and selection therefore depends on the project's progress, achievement of contracts... Contractual milestone, and customer certifications.

6:40 EPC project can also run between eighteen to thirty six months depending on the large depending on their scale, geography geography and complexity. Based on our current portfolio, the broad execution cycle is around two years through individual projects, timelines may vary. The working capital requirement of the two businesses are also different. In the manufacturing, we fund our raw material through work in progress and finished goods until dispatched and collection. In EPC, the procurement and the initial mobilization often takes place before the corresponding installation.

7:27 Certification and selection milestones are completed. Working capital requirement can therefore be higher during the early phase of a project and beginning to moderate as the project moves through to execution and billing. Understanding these operation cycles is important when evaluating our order book, quarterly revenue and margins and working capital movement. The addressable market for our business is significant and continues to expand. According to Precise Intelligence, India's conductor market increased from approximately 102,000,000,000 in f y twenty to approximately 185,000,000,000 in f y twenty five, and this is expected to reach 230 to 250,000,000,000 by FY thirty.

8:32 This growth is expected to be supported by transmission network expansion, renewable energy evacuation, railway electrification, reconducting, and export demand. Within this broader market, the product mix is also evolving. Conventional conductors continue to form a large part of the demand, but utilities are increasingly adopting advanced and high capacity conductors to carry more power, reduce transmission losses, and upgrade existing networks. Crescent expects demand for HTLS conductors to increase as the conductors...

9:22 As the country adds higher voltage transmission lines and the utilities address right of rate constraints through these reconducting and upgrading existing corridors. Our manufacturing and PPC capability allows us to participate across both new transmission line infrastructures and upgrade of existing networks. One area that I'm particularly excited about is the opportunity in advanced conductors. India's electricity requirement is growing rapidly, and the utility needs to carry more power through existing transmission networks.

10:09 Building new transmission corridors, however, requires additional land, towers, and right of way approvals, which can take considerable time. Upgrading and upgrading existing transmission lines provides a practical alternative. By replacing conventional conductors with advanced high capacity conductors, utilities can increase their capacity of existing corridors without rebuilding the entire transmission infrastructure. We identified this opportunity early and partnered with TS Conductors, a US based technology company with established international experience in the next generation conductors.

11:02 Under this partnership, LASER is a licensed manufacturing partner to produce TS conductors advanced AECC technology in India. The technology combines both higher power current... Carrying capacity capability with improved operating performance. It protects carbon fiber composite core and is designed to reduce sag and transmission losses by offering greater reliability under demanding conditions. It is also compatible with conventional installation practices and standard settings, which sim... Which simplifies the deployment and maintenance for the utility.

11:54 Delivering these benefits require more than conventional conductor manufacturing capacity. Advanced conductors are a specialized segment, where participation requires access to proven technology, extensive product testing and qualification, and the ability to support installation and execution on ground. Our partnership brings together TS conductors' proprietary technology and international experience with LASER's established capability in design, testing, and manufacturing and installation of project execution. The opportunity is also becoming visible through tendering activity.

12:43 Over the last one year, utilities have approximately floated tenders worth 3,500 crores involving HTLS conductors and reconducting. We have participated in approximately 1,250 crores of these tenders. Over time, we expect our AECC and wider portfolio of advanced conductors to increase the technology content of our product mix, expand the range of projects projects in which we participate, and support improved realizations and margin.

13:31 Coming to the quarter, quarter one of FY twenty seven reflects healthy growth and continued execution across both businesses. The revenue from operations increased by approximately 15% year over year to 5,215 million. EBITDA grew by approximately 26% to $659,000,000, and EBITDA margins improved to 12.6% from 11.5 in quarter one of FY twenty six. Amit will take you through the financial performance and the key drivers in greater detail.

14:18 Our order book stood at approximately 27,884 million as of June 26. This comprises of 14,327 million of manufacturing orders and 13,557 million of EPC order. The completion of our IPO has strengthened the foundation of our next phase of growth. A step... Substantial portion of the fresh issued proceeds was allocated towards reduction of our borrowings. As these profit... Proceeds are utilized, we expect leverage and financial cost to reduce progressively.

15:04 A strong balance sheet would also improve our financial flexibility and support the banking facilities required for larger manufacturing orders and EPC projects. We have also built sufficient manufacturing capacity for the next phase of growth. Having expanded installed capacity meaningfully over last three years, our immediate focus is on improving utilization, increasing the productivity of our existing assets, and growing the contribution from higher value added products. In certain certain expansions and operations, improvement initiatives have already been implemented. We also have land available within our manufacturing footprint to support our further expansion as demand develops.

15:57 Future CapEx will be undertaking taken in a phased manner aligned with our customer demand. With this foundation in place, our strategy and priorities are clear. First, to execute our manufacturing and EPC order book with discipline while maintaining higher standards of quality, safety, and delivery. Second, to increase the contribution of specialized cables and advanced conductors supporting improved realization and a richer product mix. Third, to improve working capital efficiency and strengthen the conversion of operating earnings into cash flow. Fourth, to use our stronger post IPO balance sheet to pursue growth opportunities while maintaining prudent leverage and disciplined capital allocation.

16:55 Fifth, to continue investing in people, technology, customer relations and execution capability. This remains fundamental to our long term success. Before I conclude, I would like to thank our employees, customers, suppliers, banking partners, shareholders for their continued trust and support. We are at the beginning of our journey. As a public listed company, we are committed to earning that trust one quarter at a time. With this, I will now hand over to Amit, who will take you through the financial performance, working capital deployment, and post IPO capital structure.

17:47 Amit, over to you. Thank you, Deepak, sir, and good morning to everyone. I will take you through our financial performance for QA FY twenty seven, the segment results, working capital development, and impact of IPO on our capital structure. For today's discussion, all financial figures are on a stand alone basis unless otherwise stated. Revenue from operations for q one FY twenty seven is 2 dot $52.01 5,000,000, representing the... Representing year on year growth of approximately 15% compared with $45.04 1,000,000 in q y FY twenty seven.

18:35 EBITDA increased approximately 26% year on year to $65.06 59,000,000 compared with $524,000,000 in corresponding quarter last year. The EBITDA margin improved to 12.6% from 11.5% in q y f a... Q one f a twenty six. Profit before tax increased approximately about 27% year on year to twin... 26,000,000 compared with $222,000,000 in q one FY twenty six. Part is 2 dot 211,000,000 with top margin approximately at 4.1%.

19:27 Coming to the segment performance, the manufacturing business reported a revenue of $38.02 4,000,000 compared with $39.03 2,000,000 in q one last year. Manufacturing EBITDA, it stood at approximately $388,000,000. The EPC business delivered a strong year on year growth with the revenue increasing approximately 129% to $13.09 1,000,000 from $6.00 9,000,000 in q one f y twenty six. EBITDA increased by $2.02 76,000,000 from 93,000,000 in EPC segment. EPC EPC profitability can vary between quarters depending on the mix and and the state of projects under execution.

20:21 The q one margin should therefore be viewed in context of projects executed during the quarter rather than treated at a steady quarter run rate. Finance cost cost $20,362,000,000 during q one FY twenty seven compared with $296,000,000 in corresponding quarter last year. Finance cost absorbed approximately 55% of quarterly EBITDA and remained as principal factor moderating the conversion of operating profitability into PAT. It is important to note that Q1 financial results cover the period ended 06/30/2026, while the IPO was completed in July 26.

21:12 The Q1 finance cost, therefore, does not reflect the benefit of reducing borrowing through the utilization of IPO proceeds. Approximate approximately 4,900,000,000 of IPO proceed was was utilized towards the repayment of loan outstanding. Approximately 4,900,000,000 have been utilized for debt reduction. Gross debt currently stand at approximately 3,600,000,000. It is important to note that the company also maintained a fixed deposit of approximately 2,400 million with bankers, primarily as margin money.

22:02 After existing these deposits, the company's net debt position become negligible. The reduction in borrowing is expected to result in in a progressive decline in finance cost As the debt repayment was completed during Q2 FY twenty seven, the full benefit will accrue over subsequent quarters. While only the proportionate benefit of the post prepayment period will be reflected in Q2. The business growth company will continue to use working capital facilities to support business orders, manufacturing order, and EPC execution. Our objective is therefore not to eliminate the operating worry, but to maintain and leverage at a prudent level, aligned with the cash generation and the scale of business.

23:01 Working capital remained as important area of focus during q one. During the final quarter, our FY twenty six, we commenced project with an aggregate value of approx 8,000 million. These projects were in the initial phase of execution during q four and q one of this year, requiring procurement, mobilization, ahead of corresponding installation, billing and collection milestones. The con... This contributed to increase in inventory, working capital requirement during the quarter. As this project progress through installation, certification, billing and collection, we expect associated working capital to gradually moderate over the coming quarters.

23:50 We remain focused on aligning procurement with execution schedules, improving certification and billing time lines, accelerating selection, and converting project inventory into revenue and cash. To summarize, q one FY twenty seven delivered healthy growth in revenue and EBITDA supported by strong EPC execution and broadly stable manufacturing profitability. While the finance cost continued to constrain our conversion during the quarter, the utilization of IPO proceed towards debt reduction should progressively determine our capital structure and improve the conversion of operating earnings into net profit.

24:36 Our financial price... Priority for remainder of remainder of FY twenty seven are clear, improve working capital conversion, realize benefits from the degree of business, and support the business growth while maintaining prudent leverage and capital discipline. Thank you for the time, and we will now be happy to take your 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 their touch tone telephone. If you wish to remove yourself from the question queue, you may press star and 2. Participants are requested to use handsets while asking a question.

25:24 Ladies and gentlemen, we will wait for a moment while the question queue assemble. We take the first question from the line of from Diamond Asia. Please proceed. Good morning, sir, and congratulations on a very successful IPO. Sir, couple of things. First was on the new products. Can you talk about the new product pipeline that you have developed? What are the key differences between the existing products in terms of conductors today in the market? And what technology have you worked on that and how scalable that can be? Sorry to interrupt, mister. We are actually not able to hear you clearly. Could you please come closer to your device and then speak a bit louder?

26:16 Yeah. Am I audible now? Hello? Am I audible? Yeah. Yeah. Now you're audible. Yeah. Yeah. Hi. So congratulations on a very strong listing and execution. Thank you. Thank you. So just first question is on the new products that, you know, you discussed at time of IPO that your team was working on in terms of r and d. Conductors. What are the new products, you know, that you have called the breakthrough? How scalable that can be? How will differentiate with existing products in India right now? So that's the first question, sir. Yes. Thank you, mister Praful, And I would like to answer that question in another way. If you look at our country, the kind of power generation requirement that has come up, we are planning to increase our power generation capacity from almost 500 gigawatt to 900 gigawatt in next five or seven years. That's the...

27:17 That government has undertaken. It's a very big plan that the government has undertaken. And you can very well understand the kind of ROW issues that we face. Erecting new towers or getting new lands is a challenge that is going to keep on increasing in the years to come. And then we understood this challenge very early, and then we identified a company in US for time up for this technology. And we tied up with this technology about year and a half back. And ever since then, we have been constantly trying to make headroom into the business. We have participated in tenders worth more than 1,250 crores, and these tenders are under active evaluation.

28:12 With this technology, the kind of development that will happen will be unique in itself. It has certain advantages that no other technology provider in the world is able to achieve. I would like to just highlight a few advantages of this this technology. One of them is the kind of strength this conductor has. It has almost one and a half times more strength than the existing conductors that are being installed. And apart from that, the conductors have a very big advantage from installation practices side. In these advanced conductors that came up earlier, installation practices were quite quite complex.

29:03 And with this new technology, the installation practices have been made easier. So that helps to expand the transmission network quickly and with a lower cost. So in this way, we expect the business to grow in this sector in the coming years, and this is about the new technology that I've already talked to you about. The addressable market of this new technology in last one year, tenders worth almost 3,500 crores have already come about. So we expect this amount to grow in the coming years. So the... This is quite a addressable market. Apart from that, we are also making high voltage cables. And in nine... Last 2.25, we have increased our high voltage cable sales from 9% of our total revenue to almost 29% of our total revenue in last nine quarters.

30:00 So HD cables is also a sector which is growing in its own way, and we are capturing that growth as well. Super, sir. And second, that on margins, then doing the product mix or medium term, what margin expansion we can expect? I'm not talking about a quarter of next eight to eighteen months in the business, given the backdrop of this, you know, unique technology that the orders will come in when we see that? Yes. Coming to the margin levels, over last five decades, our performance has been quite stable, and the EBITDA margins that we have maintained in the past few years or even in the last financial year, with this new product coming in, we expect the margins to remain stable, and the revenues also to grow at a steady level as we have been growing in the last five years at around 15 to 16%. We expect this growth to continue in that same manner.

31:09 Okay. Thank you, sir.. Thank you. Thank you. We take the next question from the line of from Investment Advisors. Please proceed. Hi. Good morning. First of all, regarding the numbers, why we are not talking about this consolidated numbers and everywhere we are putting this central number even in the press release or in the presentation or even in the call. So whether we close the subsidiary or there is no subsidiary to consider consolidated numbers. Okay. So to answer that, so since our standalone number is more reflection on towards our operating business and the subsidiary, which currently we have just one subject subsidiary having new revenue in this year that was created as an x p b for a particular project.

32:08 So since we are focusing on this kind of new number, and if you see the number, the current business component is stand alone, there is no revenue difference and it's a minister later that the the the level. So hence, we thought that more effective number for our financials would be the stand alone, hence hence, we are presenting that stand alone as a number. So... But but when we see this is bottom line, there's a huge difference. So it matters to the company. So even the the EBITDA level or revenue level, there is no difference. If something is going to the subsidiary, then it matters. So we should... Normally, every company's quota or consolidate them. Maybe they can report standalone separately, but people should consider the consolidate rather than standalone. So if it is not the we should resolve the sub.

32:59 No. Sure. So, sir, if you see, like, regulatory require... As the regulatory requirement, the number we have uploaded and site is both a standalone and consolidated. And though for the presentation purpose, since we thought that that is more representation of the number, and there is a very... Even a bottom line number, that difference is roughly about, like, $20.30 lakhs p. So it's very meaningful difference. So, hence, we didn't place that. And once we start getting revenue, most likely from next year in that XP, we will start putting consolidated number, sir, in that presentation. No. When when we see bottom end, the profit's gonna drop from 50 crores to 20 crores. This is not a small number.

33:47 I don't think so. You can take that one. Okay. I can see consolidate number. The package is the. Talking about from the last year comparison. So you... Please note that in last year, when we say control number, in consolidation, there is a onetime revenue. There is an extraordinary profit of 32 crores, which was reported last year. And, hence, that that one time revenue can't be considered as, you know, as ongoing thing. So with that, it's an annual number that better comparison, and that was the targeting basis that only we have presented our number. Okay. Yeah. So on the growth front, I think Sorry. The last three last three... Yeah. Yeah. I just asked for one question only. Just let me... Allow me to ask second question.

34:35 So on the growth front, so the last three, four years, top line, maybe just 10, 15% numbers. But at the bottom line, they have grown seven x from 20 gross to one fifty gross. So in the current financial, sir, can we expect a little 70% growth of 50% growth in the bottom line? No. I didn't get that question, but what I what I can hear that whether the bottom line will grow and by how much. So we have to consider that we... Since we have repaid, we have used our IPO proceed to repay the debt. So, obviously, that benefit is going to flow in bottom line, and that could show a significant increase in our bottom line by that. And business, as you know, it will happen as business.

35:21 Yeah. Just a follow-up on that. So if if we remove that finance cost reduction, so we've grown from 20 gross back to $1.50 gross back in the last four years, four or five years. So the CAGR would come around 70%. So in two years, we've grown 100% back from 20 to 40, 40 to 100, a 100 to one fifty. So the current year, can we expect this this kind of 100 to 50 to 40 gross back? We are we are not actually trying to provide any specific guidance on how the FY 2021 will look like. But at broader level, what we mentioned, our revenue to grow basis are five five years CAGR, we can see it. Then EBITDA to maintain, and then the finance quarter, all those things will follow to the bottom line. But at the same time, when you say $1.50 crore of last year, I would like to consider that $1.24 last year at $32.32 go over the one time benefit, and this is not going to flow this year.

36:23 So the comparative comparative number would be around $1.20 c s. From there, we have to compare things. Yeah. But but what Mister, I would request you to join back with you as there are several participants waiting for their term. Before we proceed, participants, in order to ensure that the management is able to address questions from all the participants, please limit your questions to two per participant. We take the next question from the line of from Asian Market Securities. Please proceed. Hi, sir. Thank you for the opportunity.

37:08 So my first question is with respect to the conductors. So you've recently secured your first commercial HDLS reconducting order under the TS partnership. So just wanted to know if you could give some more color on the size of this opportunity, the current pipeline, and what's the expected revenue contribution from HDLS and other advanced conductors over the next two to three years? And also, are the margins materially higher than the conventional conductors? Yes. Thank you. I mean, I'd like to highlight that this is a segment which is involving partnership with with a company in US called Clear Conductor.

37:53 So this is patented by him. It's a patented technology. And whenever a patented technology is introduced into the market, it does carry certain advantages. Now those advantages will come through as and when we start executing projects. As we told you earlier, we have already bid in projects worth almost 1,250 crores, and all those projects are under evaluation. As soon as those evaluations come through and prices open, we expect our revenue generation to come from those new products. And as soon as those revenues come in across since the products are a bit premium in nature, they should improve our margin levels. Having said that, we hope to do that in the next few quarters, and we'll wait for the results to come out.

38:48 Got it, sir. Sir, in continuation of this, if you could please speak a bit more on the realizations per ton in the conductor segment. And also, what's the split between cables and conductors in the manufacturing division? So in manufacturing division, our cable and conductor split usually between 909010%. And that's how... Because till now, we are selling those conventional conductor, and this is a keyless segment coming into the picture. That that proportion will increase with the the semiconductor. But on those, we'll be able to comment once we get our firm orders and how the things are progressing. Got it. So so 90% is the conductor segment and 10% is the cable spot. Right?

39:33 It's it's other way. So 90% is cable and 10% is conductor as of now. Got it, sir. Thanks a lot. Just just one more question if I may squeeze in. So your current capacity is at 62 percentage. So how should we think about the utilization over the next two to three years? Again, will it be dependent on the, you know, order winning from this, you know, the twenty third... The order pipeline that you have mentioned a couple of minutes back? Yes. It happens. Like, since this is a new technology, we also built the capability to deliver the new product engine. So as soon as we go to get those orders, this capture utilization will improve. And also, we need to understand that in our sector, what happens, you can't increase your capacity overnight. So definitely, if if we need to capture the future revenue growth, we have to increase it beforehand.

40:28 Like I said, initial period, it is the level of utilization may come at lower side once we increase, but gradually set it up. Got it, sir. Thank you, and all the best. Thank you. Thank you. We take the next question from the line of from Sequium Investments. Please proceed. Hi sir, thank you for allowing me to ask question. I just have two questions. One, post the repayment of the debt using our IPO proceeds, how much interest saving can we expect on a quarterly basis? So the interest saving, typically, our cost of capital is roughly 9%, and we have a repaid for 90 crore of debt. So accordingly, the interest saving will come through, and that should be nearly somewhere $40.43 in a year at PVD level, and that can be coming to quarter.

41:25 So 40 crores of interest save... Savings will be One and ten. 100 and Okay. Understood, sir. And sir, on the cable front, my second and last question is with respect to cable. On our cable front, our capacity utilization is 80%, roughly around 80%. So I just want to understand what's the peak revenue can we do with the cable... From the cable division. One is that a follow-up on that is, are you... Because if my understanding is right, because of the demand, you can easily able to ramp this capacity to 90, 95% by the end of q four. So are you planning to come up with new manufacturing capacity? And if so, can you just give a brief about it? I'll explain this in two, three parts. So one, when we say about the utilization, the utilization will definitely depend on revenue. So what kind of revenue and what kind of order we are executing and depends on product also at times. Because there are certain products which utilize higher capacity. There are certain products which utilize lower capacity for revenue generation, different how complex product it is.

42:31 And the capacity would be have declared And as far as the ramp up of the capacity, we... If you see over the years, we invest every year in some CapEx to improve our capacity. And we we will continue to do so as an as an an strategy. The third part I want to mention that, if we say my optimum utilization level, so I can... What we are reporting is actually the... When when we say 85,000 metric tons, the opportunity we have, it is actually optimized one only. So we are not... So we can go up to utilization 90, 95% of the capacity. But as in the strategy, what we keep doing that at 75... Once we reach to the 75, 80%, we we enhance our capacity. So that's how we are working over the years, and it... We we will continue to do so.

43:22 And, sir, the first question, how much peak revenue can we expect from the cable business, like, dollar or So it's about 65% of the utilization. That that number can't be placed here because that will, again, depend on the product, what kind of product demand we get. So everything will depend on product mix and duration. It will depend. Having having said that, we do we do plan to bring about better revenue from high voltage cable, HD cable segment, which is... Which we've already told you has increased in the nine nine quarters from 9% to 29%. So our focus is on HD cables going forward. And apart from that, the new product range that we are bringing in as and when the order starts flowing in, we also expect the revenue comp... To come from that segment as well.

44:16 So just a follow-up, if I can squeeze. One one aspect on the margin front because you are saying you are planning to increase your share of high voltage cable. So what's what's... On a on a ballpark basis, what's the margin difference when we compare to... Or when we compare a normal cable versus a high voltage cable versus a conductor business? So it's roughly it's roughly, like, two, 3% of margin difference between the normal cable and SD cable at EBITDA level. And that's how we look at our business model. And what about the conductors? Is it, like, a better margin business and higher voltage? Conductors, the conventional conductors have the lowest margin in the portfolio.

45:02 And for the semiconductor business, it's more like commoditized. If you talk about the the flight conductor, the stainless conductor, that that should fit higher margin, but we'll be able to comment once we get the order and let's give you some revenue out of that. Because till now, we have not booked any revenue, but the expected is little higher on that. Yeah. Understood. Thank you, sir. Thank you so much. Thank you. We take the next question from the line of Siddharth from. Please proceed. Hello, sir., congratulations on the great listing. Just two very quick questions. One, on the HDL conductor, do we also make the carbon composite core that goes inside it, and who would be the other player that are making this core?

45:52 Yeah. So I'll give you a bit of context on the subject. Actually, as we've explained earlier, the technology provider is a US based company called PS Conductors, and that is the company which manufactures the carbon core. And it is a patented technology, and they produce this carbon core from US and export it to India. Like like the other peers who are also in the same segment, they are also importing course from maybe USA... Company in USA or maybe in Japan or maybe in France. So these are products that are made outside India and imported into India for this particular segment and for this particular solution.

46:40 This is only carbon code we speak about, and then the conductor is being manufactured in India in our factory. And the business is... The TLF is like that only. And after that, the installation part is also done by us. Understood. Thank you. Thank you. Thank you. We take the next question from the line of from. Please proceed. Hi, sir. Thank you for the opportunity, and congratulations on this thing. Sir, just... I have just one question here on the text. What we have seen that we are paying or we are setting up on the deferred tax side. Can you just explain the transaction? Like, what sort of deferred tax is still pending and how it will be utilized over the year? And last year, also, we have seen that there was a a large amount which was pertaining to deferred tax, which was reducing our tax expense. So just wanted some clarity on that part.

47:40 Yes. Hi, Bharat. And so so, Bharat, like, as we we we have done an acquisition and due to which we got up carry forward loss in FY twenty three. And for that, we are getting that tax benefit at about three years. So first of all, on 500 code, the tax saving... Entire tax saving would be roughly somewhere one twenty five, one thirty code. And for accounting purpose, we are showing that as a deferred tax, but there is no cash outflow since then on in my taxes. And this this entire will... Cash deferred benefit will be set up in this financial year. So we expect for FY '27, we have to pay taxes. So that's how the entire composition of tax would be.

48:26 So FY '28, the tax amount would be normal, which we can actually save that. Correct. So so if you see the p and got up, so we show that that's explained to the further because that's the accounting. So so it is not that there will be some improvement in p and l on account of this or some loss will be there on account of tax because that... That's been already considered. It's only cash outflow that will happen from next year, but our p and l of FY '27 or FY '26 consists the tax cost. So it... That is always after the taxes. Got it, sir. Alright, sir. That that was also my side. Thank you. Thanks, Bharat. Thank you. We take the next question from the line of from Capital and Finance. Please proceed.

49:18 Hi, sir. Thank you for the opportunity, and congratulations on a very successful listing. Sir, on the reconducting part, sir, while our four other companies also have a TS conductor partnership, we are the only ones, I believe, who have finished testing and are eligible to bid. So virtually, this... And please correct me if I'm wrong. If... When we do bid for reconducting projects, we do not have any competition. Right? We're only one bidding for it, at least when when it comes to the TS tech. A parent, ProSight, have the CTC global tech which which which they bid, but that won't be eligible for the reconducting that we are doing. Right? So just want to get an idea on that. Yeah. I'll address it in a way that we have made headroom because we made our technological tie up in March 25.

50:11 Since then, it's all been almost, I think, more than a year. When did we tie up? Of... March 25. Right? Yeah. Yeah. '25. So it has been quite some time, almost like one and a half years, and it really takes a lot of time for the development to take place. You need to develop a product. You need to type test it. You need to do prototype testing, and various other skills need to be acquired as far as direction is required, directions, approvals, and other things. So those headrooms have already been created by us, and that is the exact reason why we could participate in tenders worth 1,250 crores. And we expect these tender results to come out very soon, and that should clear up the the growth trajectory for our company, how it is going to be looking like in the coming quarters.

51:08 There's only $1,015,100,000. We... And just to reconfirm, we're the only people who are billed for it. Right? See see, in some of the tenders, there are multiple bidders. In some of the tenders, there may be lower number of bidders. But single bids would not be something that I would really stress upon. It's just that the bids are there. There may be... In some bids, there may be few players, and in some bids, there may be many players. So so just to clarify here that any tender comes, it doesn't come with a specification that you need to bid with PS technology. The the one is attended comes for the conductor. So all previous technology, all the partners, everybody is eligible to bid in the project. So that's how it's going on.

51:59 Understood. That makes sense. And, sir, on my second question, sir, why we know the conductor and reduces costs and also has very good time efficiency, sir, for PureNet Power Grading set up the transmission line, returns are fixed... I don't know, fixed percentage of of the CapEx they do. Now with the conductor, the costs go down. So what incentivizes them? Is there a move towards grid line efficiency that will payout power grid? Or can you just explain how how is that looking like? I'll address that question in two different parts. One would be efficiency of the conductor. That is one part that the utilities are already looking at, that whatever technology they want to adopt, that should be having some incentive for the better efficiency that it has. So that is one part that the utilities have started adopting.

52:52 And the second part of it would be... The second question was about... Can you repeat the second question? Sir, initially, my only question was that Power Grid generally makes a fixed percentage of fixed ROT on the amount of CapEx that it does, and now Reconducting reduces that CapEx. Yeah. This one does. So so so for that, I would like to address another point that Power Grid does this online where they have ROW challenges. Now let's say they have a line which is almost like thirty years old or a forty years old line, and there they are not able to build new line. That is where this reconducting business comes in. Because as as I told you earlier, this is a solution for reconducting where new lines and acquisition of new lines is a challenge.

53:43 And therefore, this product has... From that point of view, because Powerwind wants to transmit from point a to point b, maybe double the amount of current that is doing right now. So the only solution and the quick solution that comes in is by recontracting, not by adding new towers, which may take time. Go ahead, sir. Thanks, sir. We take the next question from the line of from Electrum Capital. Please proceed. Hi. Am I audible? Yeah. Yeah. So two questions from my side. Sir, in the last three years, our capacity has gone from 62,000 metric ton to 85,400 metric ton, but the actual production has remained flat only despite such high industry demand.

54:38 So what could be the reason for this? So so so what happened, like, I mean, that's that's absolutely correct. But as we mentioned in our initial speech also that we are moving towards a display product. So display products are, like, they may be lesser... It may be lesser in volume, but it contributes to the bottom line and it contributes also to the top line because those are very costly and little value added product. So from that, we can see our revenues increasing constantly. And as far as the volume is there, its volume could be... The production volume would be, like, roughly flat, and that that is happening because of this. And as we grow now now our mix and everything are more or optimized, as we grow, you will see that growth in coming time.

55:29 Okay. So when you are guiding 15 to 16% growth, it's volume growth or is it revenue growth? So so till date, whatever we have mentioned about CAGR of life... Last five years, we are guiding accordingly, and that is that is more or less the revenue what we are talking about. Okay, sir. And what about the mix, sir? Would the EPC and manufacturing mix continue to be what it is right now, or it could change? Yes. It will remain similar. It will remain similar, and that's our strategy because we consider EPC as a forward integration for our product. And it's been, like, final use use of our product, what we do. So the mix would be going to be remain like that.

56:14 And what are the EPC margins right now? EPC margin, again, is really... EPC margin, though, there is a segment reporting which we have done, and where we said that EPC margin roughly stands within somewhere 15 to 20%, but EPC margin can't be looked at at at a particular quarter or at a particular moment because that will depend on a single project milestone, what kind of... At what stage it is. So it varies for... In reporting time, all this. But that's how we basically see that. It's partly remaining this range. 13%. Sorry. Can you repeat? The margin rate? Yeah. Yeah. So we said 15 to 20 somewhere, it remains. Generally, what we report on increasing margins, EBITDA margins.

57:03 Okay. And, sir, on the operating cash flow side, so do we expect to be positive in this year, operating cash flow? See, in q one also, we have done a significant improvement. It's just very meaningful negative. I mean, past... Except last year, in past three quarters, we never had a negative cash flow. So, definitely, we are look Hello? Yes. Yes,. Yeah. Yeah. Hope you heard. Yes. Yes. Yes. And, sir, is this 15, 16% growth rate conservative? Can we do more? Like It's very difficult to comment, Kurupa, setting up q one. So we don't want to... We are not coming up with any specific guidance.

57:52 And what we are saying that we are confident to do a growth the way we have done in past. Okay. Thank you. Thank you, sir. Thank you. We take the next question from the line of from Investment. Please proceed. Hello, sir. I just want... Good morning, sir. I just want to know how how we are managing from the public sector and. We can't hear you. Can you hear louder, please? Can you speak up to phone? So I just want to know how management will be... They were saying because it's mostly 65% of the coming from public and government things. Right?

58:39 How it was moving away from that and so we're focusing on private sector. You said three years. So so how our revenue competition usually look like? So EPC projects, whatever we do, it's 100% coming from the government because they are the main utilities who use... Who who, you know, establish all those transmission and distribution lines. And we we usually don't take that subcontracting drop since EPC revenue typically comes from the 100% from the government. In manufacturing side, usually, it's fifty fifty between government and private sector, and that's how we will continue. Okay. I'm with the.

59:27 We take the next question from the line of from family office. Please proceed. Thank you, sir, for your opportunity, and congratulations on the great listing. Sir, I have a question regarding the reconducting process. So how is the ACC technology picking up in the international market? And what is the cost difference and installation difference between the text generation one and the ACC technology, which we have? So just wanted to understand. Yes. So, actually, this technology was commercialized in 2016 and has been in proper use in The US, Europe, and China. So it has been proven... It has already has a proven track record of more than eight to ten years in these countries.

1:00:18 And apart from that, when you are talking about the advantages, there are several advantages that come with the technology. Installation practices is one of them because you are handling a code which is more robust. So what happens is during installation, the conventional erection teams are able to handle this product much more easier because the earlier first generation technology used glass as an encapsulation. And in this technology, we are using aluminum as an encapsulation, which makes it easier for the erection team to handle, and thereby bringing down the cost of erection as well as the hardware required for the erection of these conductors. So in that way, we do have advantages over the earlier generation.

1:01:10 Okay, sir. So if the technology is available for the past, then why even... Why this has not picked up in India? Because we had a transmission issues going on for the last three, four years. Yeah. So the the basic funda behind this was that the person who invented this technology wanted to establish this technology internationally in the developing... Developed countries. So what he did was post 2016, he installed them in various developed countries so that the performance of the conductor can be established. Post that, he choose... He started looking out for a partner in India, having understood that the Indian market has also matured for this product. And post due diligence of the Indian market, they found us to be the most suitable partner, and we were chosen as the first partner in India for commercializing this product here.

1:02:09 And so that that is a problem. So with this process, obviously, it's still time. So we did that one and a half year back, and it's progressing well since then. Yes. Got it, sir. Thanks. We'll take the next question from the line of from Capital. Please proceed. Hello, sir. Thank you for the opportunity, and congratulations on the great day with the capital market. So, sir, my question was on the working capital trend. As you also mentioned that we are turning green or minuscule red on the operating cash flow part. So what are we expecting on the working capital days? We are optimizing the working capital and reducing the working capital cycle or anything else?

1:03:01 Yeah. So so our our working capital typically range between 110 to 120 days. Hundred to hundred twenty days, actually. And there could be... There could be some spike in a particular reporting date because of various reasons that PPC projected what it says it is. At the same time, there are manufacturing clearances we got, like, for example, in this quarter, if I could talk about June 26, we have seen that there is a type of inventory of HD and WIP by 90 codes, which which little bit... But but that is a visibility that since we are all order to make, once we get the order, we start producing material. So this will this will convert into revenue in coming quarters. So it's all the full number reporting deal, but typically, we see our working capital days to remain like that on a standard basis.

1:03:50 And the... In every period, some slightly come, but gradually will not work. So that's how it works in our end. Sure. Yeah. Ladies and gentlemen, we take that as the last question for the day. I would now like to hand the conference over to management for closing comments. Over to you, sir. So, thank you very much and everyone for joining us today for this question and answer session. We appreciate your interest in the company, and we are looking forward to speaking with you again in the next quarter. Thank you, everybody. Thank you. Yeah. On behalf of ICICI Securities Limited, that concludes this conference.

1:04:37 Thank you for joining us and you may now disconnect your lines.