Kalpataru Projects International hosted a conference call on Nov 3, 2023. In the conference call the company was represented by Manish Mohnot, MD & CEO. 

Key takeaways of the call

Consolidated Order Book as end of Sep 2023 is Rs 47040 crore (up 22%YoY) of which 60% is domestic and 40% is international orders.  Of the International order book of about Rs 18000 crore about Rs13700 crore (of which 11652 crore + LSG+ Foster) is T&D and the balance is other civil works such as B&F, water & airports and roads.

Order inflow for YTD FY24 has stands at Rs 12178 crore.  Received new orders (including international subsidiaries) of Rs 1562 crore in month of Oct-23 and Nov-23 till date.  Order inflow (YTD) including L1 orders stands at Rs 16400 crore.

Tendering activity is very strong across various business of the company. Confident of achieving its for FY24 order inflow guidance of Rs 25000 crore.   

T&D ordering remains robust with YTD order wins in excess of Rs 5300 crore. Favorably placed in first underground tunneling project for Kanpur Metro.  Strengthen B&F business with addition of new clients, institutional building & data center projects and international expansion.

Expect a   standalone revenue growth of 25% and PBT margin of 4.5-5%.  The company is confident of an order intake of Rs 25000 crore for current fiscal. 

For FY24, expect a consolidated revenue growth of 25% plus, EBITDA margin of 8.5-9% and PBT margin of 4-5% (with more bias towards 4%). 

Revenue growth guidance was cut to 25% from year start guidance of 30% growth and this is largely due to delay in couple of large projects as well as exit from Australian Project (from which some revenue is factored in) has forced the company to reduce the STO guidance. Expect H2FY24 to be strong facilitating 25% growth in revenue. The company has complete visibility of projects to be completed/delivered in next 6 months and thus not see any further worsening in balance period of current fiscal.

Ramping up B&F and urban infra business beyond South especially in North and Western India market.  Margin largely depends on project mix.  Not expecting margin ramp up in next 2 quarters. But next fiscal the company expects improvement in margin. Ramping up of new business including ramping up non South B&F and UI   moderates the margin in established business. And lot of legacy orders got closed are getting closed in current fiscal.

Monetisation of Non-core Assets: The company will be out of the Indore real estate project by Dec 2024 end.  Road BOT projects looking at signing non binding agreement in another couple of quarters and once that happened the company will announce it.  Road Projects are currently in last leg of debt repayment and maintenance. Infused about Rs 43 crore in road BOT projects in H1FY24 largely towards debt repayment.

Revenue growth in Q2FY24 was led by robust execution and healthy order book in T&D, B&F and Water business.  EBITDA Margin at 8.6% in H1 FY24 and 8.2% in Q2 FY24 gave change in project mix and lower profitability in international subsidiaries.

Expect to bring down the net WC days below 100 days by end of current fiscal.  

T&D revenue up 24%YoY in Q2FY24 and 16%YoY for H1FY24. The growth is largely due to strong execution & healthy order book. LMG and FAsttel reported revenue of Rs 427 crore and Rs 356 crore respectively for H1FY24. The order book of LMG and Fasttel as end of Sep 2023 stood at Rs 1457 crore and Rs 448 crore. 

T&D business visibility remains robust propelled by the growing adoption of renewables, new T&D infra development and grid integration/upgradation. T&D bidding pipeline is strong with domestic T&D tender activity showing strong rebound with opportunities in excess of Rs 50,000 crore as well as USD 3 billion of International T&D business visibility in key markets  Transitioning with focus on margin accretive and high value differentiated projects.

The company has exited from the Australia JV and the order. Continue to work for establishing EPC project in Australia.