Key takeaways of the call

Consolidated order book (excluding that of JV) stood at Rs 776.9 crore as end of June 2018 translating into a growth of 7%yoy from Rs 725.7 crore as end of June 2017. The order book grew by 10% as compared to FY18 closing order book. The domestic order book was Rs 448 crore (up 11%yoy) and that of export order book was Rs 328.8 crore (up 2%). The share of export orders in the order book declined to 42% compared to 44% as end of June 2017. The aftermarket order book at Rs 103 crore was up by 20%yoy.

Strong order intake 11%yoy in Q1FY19 with domestic order intake up by 43%yoy to Rs 141.5 crore. The Export order intake in Q1FY19 was Rs 9.82 crore, a fall of 16%. Strong growth in domestic order intake is as result of finalisation of some bulk orders during the quarter ended June 2018. The order intake of aftermarket was up by 44%yoy to Rs 7.29 crore.

The overall domestic market for under 30 MW size has started showing signs of revival. On the enquiry generation front, enquiries from the domestic market showed some increase during the current quarter over the corresponding period of last year and these enquiries are spread over larger end user segments such as Sugar, Cement, Steel and waste-to-energy.

Analysing the active enquiry the company see definite improvement/green shoot in domestic market (for turbines upto 30 MW). The company is positive for the next 12 months.

The International order inflow in Q1FY19 has been lower than the estimates of the company but it is confident of making up in the coming quarters as the pipeline under finalization is strong. The lower than estimated order booking in Q1 was primarily due to delay in finalization of orders and completion of other formalities before considering as an order in the books of the company. The company is confident that the coming quarter will see the offsetting of this trend. However, the quarter saw an increase of 12% in enquiry from the international market with good growth from Central & South America, parts of Europe etc.

Order booking mix that was skewed towards domestic market in Q1Fy19 will get corrected going forward.

The company is successful in geographical spread and product offerings. So downfall in one geography or sector is offset by other geography or sector.

Order book of GE Triveni (GETL), the JV Company booked orders worth Rs 30.5 crore in Q1FY19. The company is looking good to book orders in Q2 and Q3 of FY19.

Order book will be executed in next 9-12 months. The sales and profitability is expected to improve in FY19 with similar margins as last year given strong order book boosted by strong order intake during Q1FY19

Overall order finalisation in domestic market upto 30 MW during Q1FY19 was about 300 MW compared to 125 MW in Q1FY18 and 700 MW in FY18. The company expects 20% growth for FY19 over FY18 demand. On expanded pie the pressure on margin eased.

Enquiries and demand from process co generation is strong and the demand/enquiries from cement are also good.

OB mix is good in terms of diversification and domestic market is picking good.

API turbines- delivered the order even though the off take got delayed. Finalisation of enquiries from oil producing companies is getting delayed.

Share of aftermarket in revenue is about 20%. About 13% of order book is after market.