GE Power India Limited

Prashant Jain

MANAGING DIRECTOR, GE POWER INDIA LIMITED

Brian Selby

ASEAN REGION SALES EXECUTIVE, HYDRO

Yogesh Gupta

WHOLE TIME DIRECTOR & CHIEF FINANCIAL OFFICER, GE POWER INDIA LIMITED

Vinit Pant

SALES EXECUTIVE- COMMERCIAL, GE POWER INDIA LIMITED

25 million

very committed to safety at GE Power India Limited. We are proud to share that your Company with 25 million hours has had zero fatalities and had a very good safe track record with several sites. We have

36%

briefly the fourth quarter. In the fourth quarter, the steam services order intake was higher by 36%. We see robust demand on steam services. The strategy is on track while the new equipment project

17%

the year, steam services business continues to grow as per the expectations. The revenue grew by 17% in the full year and the order intake in the current year was stable with better margins despite

190 million

ent slide. The Company managed cash better in the financial year with borrowings reduced by about 190 million. So, that is in essence, the year on the key aspects of the year in 2021-22. Moving to page 6, yo

rs,

we see a better mix of better service margin in the order intake. We have also started taking orders, which are not largely EPC, but non-EPC with reduced risk, so that is what we also continue to see

Rs. 209 crore

portfolio, there has been a drop, but that's mainly because we had a single large order of almost Rs. 209 crores, which was booked in 2020-21, so that affected ordering. As Prashant mentioned, steam

Rs. 9.3 billion

f the slide, it is Q4 revenue numbers compared with the Q4 revenue numbers of the last year. From Rs. 9.3 billion revenue in 2021 quarter 4, we have come down by Rs. 3.6 billion to Rs. 5.9 billion in the current

Rs. 3.6 billion

ue numbers of the last year. From Rs. 9.3 billion revenue in 2021 quarter 4, we have come down by Rs. 3.6 billion to Rs. 5.9 billion in the current year Q4. The primary reason for this is as explained by Prashan

Rs. 5.9 billion

ast year. From Rs. 9.3 billion revenue in 2021 quarter 4, we have come down by Rs. 3.6 billion to Rs. 5.9 billion in the current year Q4. The primary reason for this is as explained by Prashant like the COVID ch

50%

er order intake in the last 2 years. The FGD contribution, which used to be in the range of about 50%+ has come down to around 40% in current year. So, these are the main reasons for our revenue in

40%

years. The FGD contribution, which used to be in the range of about 50%+ has come down to around 40% in current year. So, these are the main reasons for our revenue in this quarter going down. And i

Rs. 7.2 billion

own. And if we look at on the right side, the revenue for the full year 2021- 22, has come down by Rs. 7.2 billion, which is almost 22%. The prime reasons are same as we have seen for the quarter 4 and they have

“The strategy is on track while the new equipment project orders have been delayed primarily in the fourth quarter due to inflationary pressures, the customers are waiting for some of the communities to cool down to be able to make their decision on the projects, but we have a robust pipeline.”

“In projects business, we have seen a substantial lower revenue and this is driven by supply chain disruptions, which started due to the third wave of COVID that quarter and majority of the revenue now in the projects is coming from site works and supplies, they are coming into the tail end of the project.”

“This is primarily driven by lower project volume.”

“The project business was where we saw slower order intake largely due to government regulations and lack of finalization of large deals.”

“On the revenue in the new projects, we continue to run down the boiler backlog and the impact on volume that we see largely in the Company in the last financial year is due to lower volume, lower project order intake and that we see the impact in the financial year.”

“So, these were the reasons, but then going forward quarter 4, I would say things were really improving.”

“Despite all these challenges that we have seen, the steam service revenue has been progressing very well and we had 17% growth for the full year on the steam service revenue, whereas the project revenue has gone down because of our lower order intake, etc.”

“So, these contributed to the challenge on the profitability side and there has been the Subansiri project wherein we had updated the cost in the first quarter itself, had an impact of Rs.”

“870 million on the project cost front and there was some good amount of entries on the profitability side coming from our service business.”

“Very quickly on Subansiri, as we all know, this project was restarted back in January 2021 after not literally being ground to a halt since 2011.”

Moderator

7

Yogesh Gupta

7

Prashant Jain

6

Vinit Pant

4

Danesh Mistry

4

Narendra Mhalsekar

3

Simar Preet Singh

2

Brian Selby

1

Raj Raman

1

Prashant Jain

Very good afternoon, everyone. Welcome to the Q4 results call for GE Power India Limited and I welcome my team as well who is joining with me to address the presentation, what happened in the quarter and what happened in the last financial year and the next action titles. We have shared the deck online at the stock exchange. I will refer to the page number as we go through the presentation. We will cover a safety update on page 2. The executive summary on the quarter and the financial year and then we go through the financials and we come to the summary followed by question and answers. Moving to page 3, as is the custom, we always start with Safety and we are very committed to safety at GE Power India Limited. We are proud to share that your Company with 25 million hours has had zero fatalities and had a very good safe track record with several sites. We have also celebrated the 51st National Safety Day across all sites and we are also now engaging with employees, their families, whic

Vinit Pant

Thank you Prashant and good afternoon everyone. I am going to take you through the slide #8 on orders. On the left hand side of this slide, we have the quarter 4 numbers comparison between 2021 and 2021-22 and on the right side we have for the full year. So, to take up from what Prashant had said, 2021 order intake was low because in the initial part of the year we had the issue of COVID and then there were certain restrictions on imports and also there was some ambiguity on the categorization of the plants, which affected the FGD ordering. So, these were the reasons, but then going forward quarter 4, I would say things were really improving. These three factors were no longer affecting, but then we had this issue about the sudden surge in the commodity pricing, which customers were ready to place orders, but then because of the surge in pricing, cost, there was a delay, but having said that, we really feel things are getting better now. We are already seeing improved ordering from qua

Yogesh Gupta

Thank you, Vinit. Good afternoon everyone. I will take you through the Revenue slide, which is slide #9. If we see on the left side of the slide, it is Q4 revenue numbers compared with the Q4 revenue numbers of the last year. From Rs. 9.3 billion revenue in 2021 quarter 4, we have come down by Rs. 3.6 billion to Rs. 5.9 billion in the current year Q4. The primary reason for this is as explained by Prashant like the COVID challenges, labor availability at site and the supplier delays, and another factor that had contributed to the lower revenue has been the lower order intake in the last 2 years. The FGD contribution, which used to be in the range of about 50%+ has come down to around 40% in current year. So, these are the main reasons for our revenue in this quarter going down. And if we look at on the right side, the revenue for the full year 2021- 22, has come down by Rs. 7.2 billion, which is almost 22%. The prime reasons are same as we have seen for the quarter 4 and they have been

Brian Selby

Thank you and good afternoon. Very quickly on Subansiri, as we all know, this project was restarted back in January 2021 after not literally being ground to a halt since 2011. So, over 10 years of non-activity, a substantial amount of work requiring deep inventory of equipment was still in working condition and what needed to be replaced and then of course, shortly a couple of months after restart, COVID hit, put a major impact on availability of labor and resources and the team has been just very focused on ensuring that we are trying to minimize the additional costs that are required to complete the project while managing through and dealing with the customers' expectations on the schedule. So, we have been pursuing multiple avenues and work streams in order to try to ensure that we are minimizing the cost impact, dealing with the replacement material inflation and cost of labor availability at the site, all trying to minimize the impact on the margin while at the same time having di

Raj Raman

Thanks, Brian. On the FGD execution, GEPIL continues to be the frontrunner on the milestones. Now, this is something very critical for our customers as you would imagine. These are requirements on the SOx emissions where there is the norms, which we need to meet and NTPC, one of our primary customers, is racing against time there. So, your Company continues to be leading in terms of the milestone completion. However, let me not dilute the fact that the multiple COVID waves and the unprecedented monsoon, which we saw last year did impact the supply chain and also the workforce availability at various sites. The team continues to work with various options and work through to mitigate this and wrap up and deliver on the milestones. This was further compounded by the inflationary impact, which we have seen in the later part of the year in 2021. Coming back, what we are doing, we definitely have created a lot of rigor around our claims towards customers and typically all these contracts, th

Prashant Jain

So, what I would summarize is that yes, it was a tough year with COVID and inflationary pressure and the challenge was due to the lower volume. We continue to be robust on the services year-on-year growth as we have been transitioning towards a better business mix and this part of the strategy is on track. The execution challenges are a reflection of the external environment and there is an improvement action and claims towards the end of the project and as we transition from a large boiler portfolio towards an emission and services portfolio, we are continuing to right size the Company to meet to the changing market dynamics. What we are for sure facing is the lower order volume and for that, there is a robust pipeline where we have Rs. 4,000 crores worth of projects in the pipeline and services of about Rs. 1,500 crores worth of opportunity that the team and the Company is attempting to close into order intake shortly so that we are back on track with the volume and revenue. So, that