GENUSPOWERNSEQ1 FY2023August 10, 2022

Genus Power Infrastructures Limited

6,035words

141turns

9analyst exchanges

2executives

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Management on call

Kailash Agarwal

VICE CHAIRMAN – GENUS POWER INFRASTRUCTURES LIMITED

Jitendra Agarwal

JOINT MANAGING INFRASTRUCTURES

Key numbers — 40 extracted

Rs.187 Crore

ging Director of the company and SGA, our Investor Relation advisors. We have recorded sales of Rs.187 Crores for Q1 FY2023 up by 43% as compared to Rs.130 Crores in the last financial year. Revenue growth

43%

SGA, our Investor Relation advisors. We have recorded sales of Rs.187 Crores for Q1 FY2023 up by 43% as compared to Rs.130 Crores in the last financial year. Revenue growth for Q1 FY2023 was affecte

Rs.130 Crore

Relation advisors. We have recorded sales of Rs.187 Crores for Q1 FY2023 up by 43% as compared to Rs.130 Crores in the last financial year. Revenue growth for Q1 FY2023 was affected on account of reduced capa

Rs.14 Crore

anticipate a sharp revenue rebound in Q2 of this financial year. For Q1 FY2023 EBITDA stood at Rs.14 Crores as compared to Rs.5 Crores in last financial year, a jump of 183%. Sequentially higher prices fo

Rs.5 Crore

rebound in Q2 of this financial year. For Q1 FY2023 EBITDA stood at Rs.14 Crores as compared to Rs.5 Crores in last financial year, a jump of 183%. Sequentially higher prices for raw material and a lack o

183%

FY2023 EBITDA stood at Rs.14 Crores as compared to Rs.5 Crores in last financial year, a jump of 183%. Sequentially higher prices for raw material and a lack of operating leverage as a result of lowe

10 lakh

vider (AMISP) including design of AIMI system with supply installation and commissioning of about 10 lakh smart prepaid meters, DT meter level, energy accounting and FMS for these smart meters from a sta

rs,

sign of AIMI system with supply installation and commissioning of about 10 lakh smart prepaid meters, DT meter level, energy accounting and FMS for these smart meters from a state utility. The total o

Rs.828.57 Crore

vel, energy accounting and FMS for these smart meters from a state utility. The total order was Rs.828.57 Crores (net of taxes) is the single largest order finalized by any state in India for AMISP. As on Ju

Rs.1,855 Crore

st order finalized by any state in India for AMISP. As on June 30, 2022 our order book stood at Rs.1,855 Crores (net of taxes). Just a few days back on July 30, 2022 the Prime Minister Narendra Modi launched

Rs.280 Crore

is on the opex model and one is on the capex model. On the capex there is a live tender of around Rs.280 Crores, which are already been participated and on opex model there is a live tender of Rs.774 Crores w

Rs.774 Crore

nd Rs.280 Crores, which are already been participated and on opex model there is a live tender of Rs.774 Crores which has already been participated. In there, lot of conventional metering tenders which has al

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Guidance — 20 items

Kailash Agarwal

opening

“However, we expect that the normalcy in supply chain to be restored within the next three months and anticipate a sharp revenue rebound in Q2 of this financial year.”

Kailash Agarwal

opening

“Let me open the floor for the questions because JK is somewhere else and he will be answering more of the questions, so let us try to do that then.”

Jitendra Agarwal

“In tender it will be participated in the next three to five months it will be to the tune of Rs.16,000 Crores to Rs.17,000 Crores.”

Jitendra Agarwal

“That has been the major reason so FY2023 we expect the topline and Earlier we have given the guidance that of around Rs.1200 Crores.”

Jitendra Agarwal

“So currently I can give you the guidance of Rs.1000 to 1050 Crores.”

Jitendra Agarwal

“In contract booking wise in FY2023 most of the tenders will be decided.”

Jitendra Agarwal

“The order book position will be very, very healthy for FY2024 by the end of FY2023.”

Jitendra Agarwal

“Automobile has almost normalized or will normalize in the next two to three months and there will be significant improvement in for the availability of components for industrial electronics.”

Jitendra Agarwal

“That is the reason I confidently feel that H2 will be much better for companies like us in comparison to H1.”

Nikhil Jain

“Sir the second question is related to the guidance so I just heard that you are revising the guidance for the year to around Rs.1050 odd Crores from let us say Rs.1300 Crores to Rs.1400 Crores that we had at the start of the last quarter.”

Risks & concerns — 8 flagged

I was not expecting Q1 to be bad or difficult.

— Jitendra Agarwal

So there we do not see any challenge in that.

— Jitendra Agarwal

I am trying to understand that how do we plan to secure ourselves from the risk arising out of the state government policy intervention if we plan to play a long term role of being the system integrator?

— Priyanka Singh

Jitendra Agarwal: So lot of work is happening on the development of value added products - so since the topline is low we can see the impact of employee cost So you will see on all the investments what we are doing currently will have a great future ahead of us.

— Kailash Agarwal

Is there anything that - what is the risk basically that we have we have got the semiconductor one and the timeline shifting?

— Nikhil Jain

So what is the risk that we might have in this year?

— Nikhil Jain

As such on the ground we are unable to envisage any major risk so to the extent only the way the China war happens or something happens, something happens grossly wrong to the world and everything will be impacted.

— Jitendra Agarwal

It is very difficult to give the guidance currently that what percentage of service revenue will be there every year.

— Jitendra Agarwal

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Q&A — 9 exchanges

Good evening Sir. Sir my first question is on the order inflow outlook for the balance of the year? Of course the government it looks like the RDSS system is in place and host of other UP, MP, Discoms in pipeline can you please update us to the status of this? That is the first question.

Jitendra Agarwal

I will distribute the order inflow in three modules for the live tenders, which are already being quoted. in smart meters, there are two types of live tenders that are currently available. One is on the opex model and one is on the capex model. On the capex there is a live tender of around Rs.280 Crores, which are already been participated and on opex model there is a live tender of Rs.774 Crores which has already been participated. In there, lot of conventional metering tenders which has already been participated, that is to the tune of Rs.1089 Crores almost Rs.1100 Crores so these are conven

Thank you for the opportunity. Sir, are we planning to bid for further system integrated orders of the scale of Bihar which we have already got?

Jitendra Agarwal

We have a very clear-cut guidelines generally to certain extent only we will go as the AMISP on our own balance sheet. Basically we can say like that, that we will be not taking too much of AMISP on our balance sheet. So basically we have taken this order. Now we will be participating more in supply, supply of the meters but then if our balance sheet - whatever we will be do we will do on the basis of our balance sheet and we are ready to make some SPVs of these project and bring in project specific investors also so whenever we are doing in the AMISP. In the start of the tender bidding proces

Thank you for the opportunity again. Sir I just wanted to check whether the ordering and the tendering process that is currently happening - is it as per the earlier plans that we had or is it going slow. Because in quarter one at that time of quarter one also our order book was around Rs. 1800 Crores and after doing this 200 Crores our order book is still Rs.1800 Crores. So in this last three months odd we have got Rs. 200 odd Crores new orders right. So is it like because the tendering is going slow or there is some change in the market share or something?

Jitendra Agarwal

Tendering is going slow because the products that we have supposed to be finalized under DPR. What the government has given the guidance earlier with all the DPRs should be frozen by 30th October last calendar year and by 31st December all the tenders should be out. But because there was some gaps between the state government and the central government and there was a supply shortage also. So the government has come out with a empanelment guidelines for all the new tenders. Because of this empanelment process all the tenders got delayed around six months. so now There will be lot of tenders in

My first question how much of the revenue is the ratio between the project base and the product base?

Jitendra Agarwal

So our prime revenue is asset based only. Where do you want this ratio to be? In the last quarter you want to know. No, in the times to come where do we want this ratio to be. No what do you mean by projects like is that like we are doing a turnkey project of the smart meter in Jharkhand. No, I need the order book versus our day to day revenue business like that? I did not understand your question. No, what I am trying to say is are we showing only our order book in our revenue, the revenue is not only of order book, right. It includes also the day today which is activities like selling of oth

Thank you very much for this opportunity Sir. Couple of questions from my end first being Sir if you could tell us when can we expect the availability of the semi conductors to normalize.

Jitendra Agarwal

It will normalize in next three to six months to a very large extent. Second question is basis we have the capacity to produce to around say 10 million commercial meters. Can we replicate the same capacity for manufacturing smart meter or will we have to decrease our capacity. No, almost similar capacity guidance we have given earlier also, Genus can comfortably produce 9 to 10 million meters - the smart and conventional meters. And Sir how much capital will be required to double our capacity from current levels? Is it possible to double our capacity in a year. Very minimal and within next thr

Thank you for the opportunity again. Sir just wanted to know whether all the legacy order which was low margin orders because of the commodity price increase - are they kind of finished or are they are still pending and how much of this?

Jitendra Agarwal

Some are still pending So by when do you expect them to be finished? Slowly and gradually in next two to three months. And in this quarter would that be finish this quarter two. More or less So then it will touch little more than quarter two also, right? Very minimal. And all the new tenders that we have kind of quoting in so we are taking into account all the commodity price increase and they will come with the right margins that the company aspires to, right? Of course. And the last question is there anything that can actually happen in the environment which can delay this entire process of

Thank you so much for the opportunity. I have couple of questions. First is Sir what is the capacity utilization in Q1 FY2023. Second is how much revenue growth…

Jitendra Agarwal

Capacity utilization is almost same. How much revenue growth do we anticipate over the next three to four years from current level. Next three to four years whatever that Government of India is planning and they may see some capacitive on the power which. We are really confident on the ground and I am expecting from the current levels whatever the peak levels Genus has seen – two to three times growth comfortably. And the smart meters replacing conventional meter, so what is your guidance on operating margins in the upcoming years. Operating margins will be little better than the smart meters

Sir, I want to understand our smart meter is it tamper-proof?

Jitendra Agarwal

No it will give the tamper proof meter. Even all the electronic meters supplied in India are tamper proof. Because in our space some layman is doing, its remote control with the Gujarat State Electricity Board smart meters. I understand what you are saying We are fighting with these kind of people but that is very minimal. Electronic meters are very strong tamper proof meters and are not easy to be tampered It is a herculean task to tamper. So, I asked regarding so because we are going to get more and more orders and with this kind of payment and then what is the benefit of government? You hav

A lot of business we are seeing in the coming times and we will not disappoint you for sure. Thanks a lot, thank you very much.

Management

Speaking time

Jitendra Agarwal

Nikhil Jain

Moderator

Anshuman Ashit

Priyanka Singh

Harshit Dole

Kailash Agarwal

Aditi Jhawar

Urmil Shah

Anjana Shah

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Opening remarks

Kailash Agarwal

Good evening, ladies and gentlemen. I sincerely apologize for the delay today happened because of some technical issues and all. A very warm welcome to the Q1 FY2023 earning call of Genus Power. With me I have, Mr. Jitendra Agarwal, Joint Managing Director of the company and SGA, our Investor Relation advisors. We have recorded sales of Rs.187 Crores for Q1 FY2023 up by 43% as compared to Rs.130 Crores in the last financial year. Revenue growth for Q1 FY2023 was affected on account of reduced capacity utilization due to disruptions in supply of semiconductors and other essential electronic items. However, we expect that the normalcy in supply chain to be restored within the next three months and anticipate a sharp revenue rebound in Q2 of this financial year. For Q1 FY2023 EBITDA stood at Rs.14 Crores as compared to Rs.5 Crores in last financial year, a jump of 183%. Sequentially higher prices for raw material and a lack of operating leverage as a result of lower capacity utilization c

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