GRINFRANSEfinancial year 2025February 03, 2025

G R Infraprojects Limited

7,277words
128turns
10analyst exchanges
1executives
Management on call
Parikshit Kandpal
HDFC SECURITIES
Key numbers — 40 extracted
6.3%
ia mentioned its position as a fastest-growing major economy with the GDP growth forecast between 6.3% to 6.8%, in the line with IMF projections. The government demonstrates its commitment to infrastr
6.8%
oned its position as a fastest-growing major economy with the GDP growth forecast between 6.3% to 6.8%, in the line with IMF projections. The government demonstrates its commitment to infrastructure w
INR11.21 lakh crore
F projections. The government demonstrates its commitment to infrastructure with an allocation of INR11.21 lakh crores expenditure in '25-'26, marking a 10% increase from the revised estimate of current financial ye
10%
nt to infrastructure with an allocation of INR11.21 lakh crores expenditure in '25-'26, marking a 10% increase from the revised estimate of current financial year. A new asset monetization plan is
INR1,00,000 crore
While a 3-year pipeline for PPP projects will encourage private sector engagement, allocation of INR1,00,000 crores towards 50-year interest-free loans to state for capital expenditure and reform incentives is al
INR1,500.53 crore
followed by question-and-answer session. Revenue from operation in third quarter of '25 stood at INR1,500.53 crores as against INR1,806.42 crores in corresponding period in the previous financia
INR1,806.42 crore
er session. Revenue from operation in third quarter of '25 stood at INR1,500.53 crores as against INR1,806.42 crores in corresponding period in the previous financial year. The EBITDA margin impr
0.2%
responding period in the previous financial year. The EBITDA margin improved by 0.2% in comparison. That is from 12.62% to 12.82%. During the quarter, the company has repaid the de
12.62%
od in the previous financial year. The EBITDA margin improved by 0.2% in comparison. That is from 12.62% to 12.82%. During the quarter, the company has repaid the debt of INR159.80 crores, which has res
12.82%
previous financial year. The EBITDA margin improved by 0.2% in comparison. That is from 12.62% to 12.82%. During the quarter, the company has repaid the debt of INR159.80 crores, which has resulted in
INR159.80 crore
mparison. That is from 12.62% to 12.82%. During the quarter, the company has repaid the debt of INR159.80 crores, which has resulted into improved debt-equity ratio to 0.07, which is one of the best in the sec
INR19,971 crore
ates. Moving to the updates on order book. At the end of third quarter, the order book stood in INR19,971 crores. INR12,244 crores worth of the projects are under execution, INR4,642 crores awaiting appointed
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Guidance — 20 items
Ajendra Agarwal
opening
“Despite global economic headwinds, India mentioned its position as a fastest-growing major economy with the GDP growth forecast between 6.3% to 6.8%, in the line with IMF projections.”
Ajendra Agarwal
opening
“During the quarter, the company has received provisional COD for 1 HAM project and appointed dates for 6 projects, 3 roads and 1 each for metro, ropeway and MMLP.”
Ajendra Agarwal
opening
“INR12,244 crores worth of the projects are under execution, INR4,642 crores awaiting appointed dates and the rest that is INR3,084 crores include one project each of roads and OFC that are having L1 status.”
Ajendra Agarwal
opening
“On a separate note, I'm happy to share that we have been declared L1 for the road project in Maharashtra, amounting to INR1,947 crores and a Rail Project of Western Railways amounting INR222 crores for this month that is in January.”
Ajendra Agarwal
opening
“Having said that, looking at the central government's budgetary allocation towards infrastructure, we expect a decent flow of awarding utilities, especially large projects coming in the last quarter.”
Ajendra Agarwal
opening
“We will continue our strategy of diversifying our portfolio and see this opportunity, where we aim to add a decent share to our order book in the last quarter and take the company back to double-digit growth in financial year '26.”
Ajendra Agarwal
opening
“Our strong team and focus on project delivery will continue to drive our success.”
Ajendra Agarwal
qa
“So maybe for one project in the current month or by -- yes, by end of current month and the balance second road project we'll be expecting in the month of March.”
Ajendra Agarwal
qa
“And the L1 project, what we believe is that probably for BSNL, we are expecting in the current month itself.”
Ajendra Agarwal
qa
“We are expecting that LOA will be given to us.”
Risks & concerns — 1 flagged
So what drove this sharp decline in terms of guidance for FY '26 over the last quarter?
— Vaibhav shah
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Q&A — 10 exchanges
Q
2 questions from my side. First is the appointed date for the INR4,600 crores worth of projects. When do we expect that? And secondly, the INR3,000 crores L1, when should we receive this finally and the appointed date, likely appointed date for this particular INR3,000 crores worth of projects?
Ajendra Agarwal
See for INR4,000 crores of -- we are expecting appointed date for road projects, which are valuing around INR2,100 crores in the current quarter itself. So maybe for one project in the current month or by -- yes, by end of current month and the balance second road project we'll be expecting in the month of March. And the L1 project, what we believe is that probably for BSNL, we are expecting in the current month itself. We are expecting that LOA will be given to us. And for Maharashtra State Road projects, this may take time given that past experience of ours with the client. We are expecting
Q
Sir, a couple of just things in terms of us to get back to the guidance. So 9 months, we are already down close to 18% plus. So in the fourth quarter, how much are we looking at, and in the FY '26, when we say a double digit, so if you can specify how much are we looking at in terms of 15%, 20% kind of a growth we're looking at?
Ajendra Agarwal
So the first question, which -- I mean because -- yes, I mean, our earlier guidance was 5% to 10%, but what we believe is because most of the projects we have received the appointed date in the last quarter. What we believe is that for the whole -- current whole year, we are expecting that we will be certainly having negative growth of 10%, that's for sure, I believe, maybe in the 10%, 12% at max, I would say. And for the next year, because what we believe is that government is even quite focusing on the state -- I mean, they are incentivizing the state for their capital expenditure program an
Q
Sir, I just wanted to understand, so you mentioned about 10%, 12% degrowth in FY '25. So we ended up at close to INR6,700 crores. But then, sir, next year, you're talking about 9% to 12% sort of a growth -- I mean, we'll be getting INR5,000 crores worth of more projects started by end of this financial year. So don't you think that '26 estimate is pretty conservative because a lot of projects will be under execution at the start of FY '26?
Ajendra Agarwal
See, INR5,000 crores, we are targeting that INR5,000 crores would be starting by June, right? And after soon, there is a rainy season. So -- I mean, we'll certainly try to deliver more than what we have been guiding, but -- and so that's how, I mean, what we believe is that we'll be able to, quite confident in terms of achieving double digits and that means because the number is already degrowth for last year, right, given currently it's already degrowth. So even if we achieve 10% growth, we'll be again on the same number what we achieved in last year, right? So -- yes, I mean we'll be able to
Q
Sir, my first question is, what is the order inflow guidance for FY '26?
Ajendra Agarwal
FY '26, what I believe is that certainly -- I mean, see, current year, we are targeting almost INR17,000 crores of the orders in flow, right? Yes. So next year -- I mean, this year, our target -- original target was INR20,000 crores, so we'll try to stick with that for next year as well. And, sir, given the muted increase in budget toward the road segment, how are we looking for that to bid out in the next year to achieve the growth in order inflow? Like will we be bidding more aggressively within the road segment itself or look out to bid more -- bid out more frequently in the other segments?
Q
Yes. Sir, I wanted to know what would be our share of variable cost in other expenses and employee expenses?
Ajendra Agarwal
Which costs, come again? Share of. Variable and fixed, the -- a portion between variable and fixed cost? Variable and fixed other costs, you are saying. I mean what you are saying is rent and all that, right? That number isn't with me right now. Probably, we can take this question after the call. You can mail me, I will get it done -- work for you, right?
Q
So, on the margins trend, our initial margins around 10.6% for a fourth quarter. So should it be a similar number in fourth quarter as well or it can improve given the higher execution that we are targeting in Q4?
Ajendra Agarwal
Yes, I believe it should improve. It will be able to execute, I mean, the number -- execution number would be higher, then certainly, we'll be able to. So could it be somewhere around 12%, 12.5%? At least 1%, 1.5%, you can -- I mean, we can safely assume. Okay. Sir, earlier, we indicated that for FY '26 the margins could be around 14%, 15% if the execution improves. So now what kind of guidance are the -- what margins are we targeting for '26 now? '26, we just mentioned that it would be in the range of 10% to 12%, given that competitive intensity, right? So we are expecting that it -- I mean,
Q
[inaudible 39:52] so any reason for that?
Ajendra Agarwal
No. I -- we haven't -- I mean, we couldn't hear you question. If you can -- if you have to repeat... Sir, your other expenses have declined quite sharply this quarter, so any reason for that? Other expenses? Yes. Other expenses declined, I mean... It is around INR12 crores and something -- INR12 crores something? Okay. So other expenses are including the debtors provisioning. We are long outstanding debtors, right? We are -- we have been -- as per our policy, we have been providing on those debtors. For the current quarter, it has not been -- I mean, so it's a provision which has got declined,
Q
Sir, the last time we talked about power transmission and HAM, our commitment was that we can deploy INR10,000 crores kind of equity in HAM, beauty tool, transmission, everything. So, that stance still remains the same?
Ajendra Agarwal
Same, same. No change. Okay. Sir, maybe the focus is to get more BOT kind of projects, whether it is of road toll or transmission and keep on investing equity there. But for transmission, how will the equity come back to us? See, in transmission, we are exploring 2, 3 ideas. One is, of course, to have investors along with us during construction itself. And second is if we can -- it will -- after completing the projects, if we will be able to sell those transmission assets to the existing investors or the InvIT or -- so there are players who are willing to buy, right, operational assets. And we
Q
Thanks to all, to all the investors, participants…
Management
Q
My question is on the transmission side, now we have almost INR1,500 crores plus of order book. So just wanted to check who is executing these orders for us. I mean, have we developed enough capability to execute transmission projects? And does it make us eligible? Or are we looking to bid independently for third-party orders directly beyond like existing projects, that development orders? Are you looking at any EPC orders in this segment?
Ajendra Agarwal
No, we are doing the EPC work on our own, the whole team has developed here, and the same team is executing. No, in transmission, Parikshit Ji, we will look at EPC, I mean, so far what we believe is that, whatever experience we had in the industry, we do not see any margin in EPC, if the margin improves, then certainly we will be doing EPC projects also in transmission, but we should get a reasonable margin. Okay. And just on some other segments like clean energy, solar, battery storage. So, any thoughts there, sir? I mean, we are seeing some of our 50 years taking up these projects. So how do
Speaking time
Ajendra Agarwal
55
Shravan Shah
19
Moderator
12
Parikshit Kandpal
8
Vaibhav shah
8
Uttam Srimal
7
Harish Biyani
5
Jainam Jain
5
Anand Rathi
4
Alok Deora
3
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Opening remarks
Parikshit Kandpal
Thanks, Steve. Without any further delay, I would now like to hand over the call to Ajendraji for his opening remarks on the company, on the results and the way forward. Thank you, sir, and over to you.
Ajendra Agarwal
Thank you, Parikshit. Ladies and gentlemen, a very good afternoon. Best wishes for the New Year. I welcome you to the third quarter earnings call of GR Infraprojects Limited for financial year '25. Joining me on this call today is Mr. Anand Rathi, the CFO of the company. I would like to start by mentioning about the Union Budget of financial year 2025-'26. In her 8th budget, the Honorable Finance Minister presents a strategic vision to propel India's economic growth with a strong focus on infrastructure as a catalyst for the Viksit Bharat 2047. Despite global economic headwinds, India mentioned its position as a fastest-growing major economy with the GDP growth forecast between 6.3% to 6.8%, in the line with IMF projections. The government demonstrates its commitment to infrastructure with an allocation of INR11.21 lakh crores expenditure in '25-'26, marking a 10% increase from the revised estimate of current financial year. A new asset monetization plan is set to unlock value from pub
Anand Rathi
Thank you. Good afternoon. Thank you, Ajendra sir, for giving me the opportunity to share the financial highlights of the company for the quarter ended December 31, 2024, which are as follows. Our stand-alone revenues from operation decreased by almost INR306 crores for the quarter from INR1,806 crores in the previous year quarter for the same -- previous year same quarter to INR1,500 crores in the current quarter. This decrease was primarily on account of less execution due to delay in receipt of the various appointed dates as most of the projects are in their initial phases. Our consolidated revenue from operations decreased by INR439 crores, from INR2,134 crores in the quarter ended December '23 to INR1,695 crores in quarter ended December 2024. Our stand-alone EBITDA margin has increased to 12.82% in quarter ended December '24 from 12.62% in quarter ended December '23. I also wanted to highlight here that during the current quarter INR37.70 crores was received as bonus and claims.
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