Q1 2027 Axiscades Technologies Ltd Earnings Call
Speaker #3: Welcome to the Axiscades Q4, Q1, Q2, Q3 earnings webinar, produced by Elevase. I'm Shankhini, Director of Investor Relations at Dickenson, and I'll be moderating our call today.
Speaker #3: So joining us from the Axiscades Management team is the Senior Management Group. I'll hand over to Mukund later to introduce the members, who'll be on the call today.
Speaker #3: To all our participants, please note that this conference is being recorded. And that some statements in this call may be forward-looking. Based on current expectations and subject to risk that could cause results to differ materially.
Speaker #3: You can download the Axiscades Investor Deck and press release from the company website, or the NSC. I'll now hand over to Mukund. He is the Chief Strategy and Growth Officer and Head of IR from the Axiscades Management team.
Speaker #3: I'll hand over to him for opening remarks. Over to you, Mukund.
Speaker #4: Thank you, Shankhini. Good evening, everyone. Welcome to the AXISCADES Q1 FY27 earnings call. Thank you for joining us today. I hope all of you have had the opportunity to review our results, which have been filed with the exchanges.
Speaker #4: I'm the Chief Growth and Strategy Officer for Axiscades, and also Head Investor Relations. On the call today, we have Shashidur S. K., a Group CFO.
Speaker #4: I also have members of the Senior Management team, across a key business areas, aerospace, defense, electronics, finance operations, and strategy. On behalf of the Chairman and Managing Director, I will begin the call.
Speaker #4: I will then hand over to Shashi, who will take us through the financial performance and the key numbers related to this quarter. I will then call for the business heads to present their respective businesses.
Speaker #4: And we'll close the formal presentation with guidance for FY27. We will then open the floor for questions. That's a safe hour. Our Chairman, Dr. S.
Speaker #4: Arun, sorry. On behalf of the Chairman, I'll now read over the speech. Our Chairman has requested the Management team at the last investor call to take on the role of representing the investor.
Speaker #4: So let me just read the speech of the Chairman. Dear shareholders, thank you for your continued trust. Since I assumed the role in February 2025, our focus has been constant.
Speaker #4: Sharpen the strategic direction, strengthen the institution, and rebuild the company position for sustainable, high-quality growth. Six months in, we are firmly on goal. Six quarters in, we are firmly on goal.
Speaker #4: A sharper, more focused portfolio. The development of our non-core and services business is largely complete. Only Add Solutions remains, and its exit is underway.
Speaker #4: This simplification—
Speaker #3: It looks like we've lost the line. Just give us a moment—we'll get the management group back online. While it's calling me...
Speaker #4: Very good.
Speaker #3: Hi, everybody. We're just dealing with a technical problem. Just give us a couple of minutes. We'll get it sorted. Please stay on the line.
Speaker #3: Thank you.
Speaker #2: Hear my audio. Can you hear me now? Can you hear me now?
Speaker #3: Hi, I'm Mokoen. We can hear you loud and clear. So thanks to all our participants for your patience. Mokoen, you can go ahead. And I think maybe restart with our opening remarks.
Speaker #3: That would be great, thanks. Hi, Mokoen. Are you on mute? Can you go ahead?
Speaker #2: Hi, everyone.
Speaker #3: Yes, go ahead, Mokoen.
Speaker #2: Hi, everyone. I'm just testing. Is it echoing?
Speaker #4: Yes. Anthony, in the interest of time, should I cut off or talk about the financials? And by that time, probably this technical issue would have been addressed.
Speaker #3: I'm going to say yes to Shakshi. Yeah, Shakshi, you can go ahead. We'll get this sorted.
Speaker #4: Yeah, sorry for that. And good evening again to everyone for joining the Axiscades Q1 FY27 earnings call. Dr. Esaran and Mokoen, of course, will take you through the strategy and the position with respect to the various verticals, especially with respect to the retail business.
Speaker #4: And my task is to take you through the numbers: what is reported, what sits inside it, and what it tells you about the business we are building.
Speaker #4: So, this quarter, we have delivered the highest revenue in the company's history, and we also reported a net loss. This is nothing but the arithmetic of doing two things inside the same quarter.
Speaker #4: Divesting one business and building another, while the costs overlap—this is the first quarter of that transition. And it is the quarter in which the cost of transition is most visible and the benefit of it is least visible.
Speaker #4: The consolidated revenues for the quarter were ₹346 crore, up 42% year on year and 27% sequentially—the highest in the company's history. Of the ₹140 crore of revenue that shifted out of FY26 on supply chain and operational grounds, approximately 40% got converted in Q1, and the balance is planned across Q2 and Q3.
Speaker #4: The Q1 FY27 results and the financial statements, as you see them, are a direct reflection of the treatment of the divestment transaction under accounting standard Ind AS 105. The engineering services business, being divested to Accordis, is now shown as discontinued operations, splitting the quarter into ₹163 crore of discontinued operations and ₹183 crore of retained, or continuing, business. The comparative periods of Q4 FY26, Q1 FY26, and the full year FY26 are carved out on a like-for-like basis.
Speaker #4: So just to talk about the retail business or the continuing operations, the one you are now invested in, the business group and the revenues grew by 94% year on year, to 183 crores from 94 crores in Q1 of FY26.
Speaker #4: Now, coming to the profitability, as an inevitable consequence of the divestment transaction, the company is required to unwind certain balance sheet positions as per in DS 105 and has incurred costs with resultant impact on profitability.
Speaker #4: The reported EBITDA for the combined business of discontinued and continuing operations was 27.9 crores, and the reported PAT loss is at 14.8 crores, against 20.9 crores of PAT reported in Q1 of FY26.
Speaker #4: The reported loss is nothing but an accounting consequence of the value-creating divestment transaction. Every rupee of that gap is identifiable. Firstly, we took a ₹13.1 crore one-off provision inside the EBITDA line, which essentially is about ₹9.62 crores of residual provisioning, largely on an age defense transaction that we have chosen to provide for conservatively while we continue to pursue recovery with the Ministry of Defense.
Speaker #4: Plus, we also had to take a 3.5 crore hedge provision resulting from the unwinding positions, as a result of the divestment, and that do not transfer to the divested business.
Speaker #4: And most importantly, we took a 21.81 crore transaction cost in the Q1 pertaining to the divestment, which is taken below the EBITDA as an exceptional item, which is roughly half of the estimated 45 crores, about 2% of the total transaction value of the divestment.
Speaker #4: This has been, this will be accrued, and this will record the actual divestment transaction. We will now record an extraordinary gain of approximately ₹1,255 crore on the completion of the divestment transaction in Q2, Q3. Essentially, this is a timing issue.
Speaker #4: Normalized for this items, which is roughly around 34 odd crores, essentially about 21 crores, 21.81 crores of the transaction cost, which is sitting as an exceptional item, below the EBITDA line, and about 13 crores of the provisioning which we took as a result of the transaction and a conservative provision as what we took on the residuals, the normalized for 41 crores and about 11.8% margin up from 20.5% year on year.
Speaker #4: Normalized PBT was 23.1 crores and normalized PAT was 20.2 crores. This is the business we actually ran and returned money while paying for its own transformation.
Speaker #4: Now, let me talk about the retail business. And let me be equally direct about what is not yet in and where it needs to be.
Speaker #4: The retail business of defense aerospace manufacturing and Zeda, posted a 8.7 crores of EBITDA, which is 18.3 crores when you normalize it for the residual charge, which sits in the continuing business.
Speaker #4: The continuing business does not yet cover the ₹8.9 crore of finance cost and ₹8.8 crore of depreciation, which it carries. The divestment has been done on a cash-free and debt-free basis.
Speaker #4: So the earnings business—so the earning business leaves, which is, of course, the aerospace engineering services, the automotive, the energy vertical, and the heavy engineering—when the group's borrowings, the corporate cost, and the cost of building the replacement still stays in the continuing business.
Speaker #4: Axiscades, the listed entity, brings it out very clearly—₹6.1 crores of revenue, which is manufacturing aerospace revenue that we recorded in Q1, against ₹12.9 crores of operating cost and ₹6.4 crores of finance cost, which is, in fact, about 72% of the overall retained finance cost.
Speaker #4: Closing as a result of which the numbers look the way it is looking. And closing the divestment on schedule, retiring the debt and deploying the proceeds into capacity is therefore our single most important near-term priority.
Speaker #4: And the discipline is already visible. The employee cost fell from 53% of revenue to 44% of revenue, even as we hired for the manufacturing pivot and Mistral delivered 122 crores of revenue at about 14.5% EBITDA margin while absorbing its own provisions.
Speaker #4: The one clear drag is ADD Solutions our non-core European unit which recorded a 4.8 crore EBITDA loss and a 6.7 crore PAT loss, which sits in the continuing business, effectively constituting most of the continuous business loss of 7.04 crores for this quarter.
Speaker #4: It is loss-making. It is non-core, and it will be exited. An action plan is already underway, with closure targeted by Q4 of FY27. Cash on the balance sheet, meanwhile, rose 78% to ₹81 crores.
Speaker #4: Ahead of the first tranche of divestment money and the property plant and equipment rose by 40 crores in one quarter as capacity is built on the ground for the power 930 ramp-up.
Speaker #4: The accorded transaction is valued at US dollars 237 million, or approximately ₹2,256 crores, which the shareholders have blessed on July 7th and 27th, and is in the process of closing in two phases.
Speaker #4: Phase one is targeted by 31st August, which is this month, with about ₹190 crore of post-tax cash coming in, and phase two by 30th November, bringing a further ₹524 crore to ₹525 crore in cash.
Speaker #4: It funds the power 930 vision and our planned acquisitions without any equity dilution. During the quarter, the defense business in the continuing business category delivered a record 125 crores in revenue, up 112% with an underlying EBITDA of 13 crores, which is up 15% year on year, and eight design wins and order wins since April took the assured forecast visibility to 4,500 crores plus, to be executed in the coming quarters and years.
Speaker #4: Zeda was the strongest stream—revenues were ₹49.5 crores, up 63% year on year—in terms of revenue, at a 33% EBITDA margin. It added two marquee global technology customers as customer logos.
Speaker #4: Aerospace manufacturing capabilities are being built bit by bit, both in terms of talent and aerospace capabilities and certifications through planned acquisitions. To return to where I began, this quarter's reported loss is the cost of running two companies inside one set of accounts.
Speaker #4: Every element of it is identified, quantified, and either is behind us or scheduled to close within the next quarter. The business we are building on to power 930 earned a normalized EBITDA of 18.3 crores, despite carrying the strategic cost which I talked about in terms of the manufacturing pivot which is taking place, which are still to turn into revenue.
Speaker #4: On a platform that grew 95% year-on-year, with about ₹4,500 crores plus of assured defense visibility, and ₹1,255 crores of gain on divestment still to be recorded in the profit and loss statement.
Speaker #4: In closing, I will say the results declared are expensive for a quarter, but will compound for the next 40 quarters. Thank you. Now, of course, I've dealt with all of this.
Speaker #4: I would now hand over to Mukund to take this forward.
Speaker #1: Thank you very much, Shashi, and thanks for stepping in. Apologies to everyone on the call. We had a technical issue—just checking if everyone can hear us clearly.
Speaker #1: Yeah. Apologies that we seem to have had a technical issue at our end. However, thank you, Shashi, for stepping in and for covering the aspects that I wanted to cover.
Speaker #1: Let me now move on forward from here. I'll cover the continuing operations which, as you know, is the business that will define the future of Axiscades.
Speaker #1: This business has performed very strongly this quarter. We have had a continuing revenue of 180.7 crores. This includes our defense business and this includes our ESI business and this includes our aerospace business.
Speaker #1: It excludes the businesses that are being divested away, both engineering services as well as aerospace services. It also excludes add solutions the business that Shashi has already referred to where we will be finding a solution in terms of divesting that by the end of this financial year.
Speaker #1: Defense, before I hand over to each of the defense, ESI, Zeda, and the aerospace business heads, let me just give you a broad overview of how the business has performed in this quarter.
Speaker #1: Defense grew over 111% year on year. Clearly, this is over two-thirds of our continuing revenue as of this quarter. Our reported EBITDA was weaker, at ₹2.6 crore.
Speaker #1: And this was because of certain one-time costs that we had to absorb of about 9.6 crores this year. This quarter. The underlying EBITDA is at 11.2 crores, a 9.7 margin, a 9.7% margin.
Speaker #1: And further on defense, in terms of our wins, and in terms of what else we have looking forward, I will then hand over to the defense business soon.
Speaker #1: The ESI business, the ESI business, as you know, as we've now rebranded as Zeda—what we have done is headquartered this out of the United States, because that is where our customers are, that is where the technology is, that's where the capital is, and that's where the resources are.
Speaker #1: Clearly, this business has performed wonderfully with the new domiciling of the business. Revenues were at ₹49.5 crore, with EBITDA at ₹14.7 crore, giving an EBITDA percentage of almost 30%.
Speaker #1: Where did this come from? This came from a business transfer that we acquired the business of another partner and that contributed a stupendously high 46% EBITDA margin.
Speaker #1: Clearly giving us a 30% EBITDA margin combined with the legacy business that we do in the Zeda business. Aerospace, which is our upcoming manufacturing business, post-exiting the servicing business, manufacturing now becomes the future of the aerospace business.
Speaker #1: Even before we have actually added capacity, we already have a team in place. We have invested well ahead in terms of leadership and in terms of having the right people, and that has already shown in terms of a ₹6 crore revenue for this quarter.
Speaker #1: EBITDA being negative, which reflects the investments that were made into this business going forward. So to close, before I hand over to the defense business—clearly, two streams chugging on at full steam and very, very profitable.
Speaker #1: One, funded out, while the other one, the aerospace business yet to show over the next few quarters. Over to you, Babu. Thank you.
Speaker #2: Thank you, Mukundan. This is Shardi Babu. I'm head of defense. I will handle the presentation for both defense and Zeda today. And as Mukund mentioned, the defense this quarter has recorded a very strong growth quarter on quarter and year on year.
Speaker #2: And I would like to update the audience that we had several wins and we have added quite significant pipeline to our forecast visibility. And here, number one on the technology side, our defense, we have moved on on both our strategic presence in directed energy weapons and missile systems.
Speaker #2: So we have been technically selected and approved for the transfer of technology for a 30-kilowatt laser directed energy weapon. And we have received orders on the missile systems, which include the subsystems, the electronic subsystems, and also certain select high-end mechanical subsystems.
Speaker #2: Here, we are developing and developing a mobile firing platform and also a mobile mask system for the long-range missile system. And we are being now we have received the development order come production order for the onboard electronics on for the anti-tank missile.
Speaker #2: And also on the BrahMos missile and we have also received orders for the ERP for the helicopters and also the antenna beam control systems for the Uttam radar.
Speaker #2: And with all these wins, we have added the forecast visibility about 332 crores overall our visibility stands now at assured forecast visibility stands at 4,557 crores.
Speaker #2: Any further questions, I would be glad to answer at the end of the session. I will also cover the Zeda business, which, as you know, Mukund has given the financials for.
Speaker #2: I am very glad to inform the audience that we have added two of the world's largest technology companies as customers. This business transfer, which Mukund has mentioned, is based on our legacy ESI business. We are now supplying the most modern and innovative semiconductor equipment for the largest of the customers.
Speaker #2: One of them is a semiconductor equipment manufacturer, and the other one is the world's largest AI and hyperscale technology company. And here, already this is visible in the current quarter, and it is poised for strong growth quarter on quarter.
Speaker #2: And this platform is held through the wholly owned US company, which is giving us complete customer proximity and also access to engineering talent. And, you know, India is the mirror architecture for supplying the equipment.
Speaker #2: So this and this arrangement also gives us a strong visibility on new customer portfolio, which will be which we'll be serving over the next few quarters and which is based out of the US.
Speaker #2: And again, here on the Zeda, I would be glad to answer any further questions. And now I'll hand over the mantle to Mohan, who will brief you on the aerospace business.
Speaker #2: Thank you all.
Speaker #3: Good evening, everyone. This is Mohan. Let me turn to aerospace. Our manufacturing story is now becoming real. We have signed a non-binding offer for an AS9100-certified precision manufacturing company.
Speaker #3: Our due diligence is in the advanced stages of completion and is expected to complete in Q2. This transaction, when completed, on an annualized basis, the FI27 revenue would be about 180 crores with an EBITDA of 39 crores and with a 22% margin.
Speaker #3: This single transaction jumps our aerospace manufacturing capability and becomes the metallic manufacturing backbone for our defense and electronic businesses. And we are not building this in isolation.
Speaker #3: We are building a world-class infrastructure around it. The center for advanced manufacturing, 240,000 square feet on a 20 acres at Devanahalli, designed as a quad-use facility for aerospace, defense, space, and electronics.
Speaker #3: One campus and four growth engines. You would have noticed aerospace manufacturing revenue clocking at 6.1 crore in Q1. We have built a team in advance to make it happen.
Speaker #3: We have put a 30-member aerospace leadership team in place ahead of the acquisition and ahead of the revenue because aerospace qualification runs in years, not quarters.
Speaker #3: We are front-loading the team so that when the acquisition closes, we execute from day one, instead of spending a year building capability we could have built today.
Speaker #3: Put together this acquisition, we are currently evaluating a second transaction and together with an organic growth, we are targeting an annualized run rate worth of 375 crores in revenue and 84 crores in EBITDA by Q4 FI27.
Speaker #3: With this, we would have replaced the lost EBITDA due to the divested business. And the platform we are building here is the one that takes toward 1,000 crores by FI29.
Speaker #3: And our approach is invest ahead of the curve and leverage the opportunity. We shall share further excitements in the next quarter call. Thank you.
Speaker #3: I'll pass on to Mukund.
Speaker #1: Yeah. Thank you, everyone. Thanks, Mohan. An update on where we stand on our infrastructure. As you're very well aware, we have the DALV, Devanahalli Aeroline Complex, which has been commissioned and on schedule.
Speaker #1: We have moved our existing we have moved our existing supply chain and logistics capability, set up. We also have set up testing labs. We have set up SMT lines.
Speaker #1: And this facility is fully functional. Many of you who have visited this facility at various points over the last year and have seen how it has developed over the last 18 months or so.
Speaker #1: We also have the Devanahalli Atmadilbar Complex, which is a 20-acre plot just a stone's throw away from DALV and very close to the Bangalore International Airport.
Speaker #1: This is going to be a flagship aerospace and defense and space manufacturing hub. It also we have started building the satellite manufacturing assembly integration and testing facility for the space business.
Speaker #1: The third complex that you've been hearing about is a missile Atmadilbar complex. This is in Hyderabad. The land had been acquired. This quarter, we had actually done the groundbreaking in early July of this year.
Speaker #1: Construction has begun on this complex. This complex will support missile subsystems as well as strategic electronics. The location in Hyderabad is deliberate. This sits very well within the missile ecosystem that is being developed in that city.
Speaker #1: The new facility that we are setting up, which Mohan had referred to in his aerospace coverage, is a center for advanced manufacturing, again in Devanahalli.
Speaker #1: The land allocation is well in progress. It's a 240,000 square foot area and 20 acres of land. And this is just a few kilometers away from DAC and DALV.
Speaker #1: This will house manufacturing capabilities, not just for the aerospace business, but for all the other three businesses having a common platform servicing four businesses.
Speaker #1: Let me let me now let me now move on to the guidance. As you know, ever since this new management has been in place, we have made several commitments to the markets.
Speaker #1: We have committed and we have delivered against each of the commitments. Most important of the commitments was the fact that we would grow into a manufacturing and a product and solutions company while divesting our services portfolio.
Speaker #1: And we do all this without actually without any equity dilution or any material long-term debt. The divestments are well underway. We are divested, as you are aware, we are divested the engineering services business in the month of May.
Speaker #1: And the aerospace services business in the month of June—both of these are progressing well towards closing. We expect to close the engineering services divestment in this quarter itself, with the money coming in a week later.
Speaker #1: We will expect to close the aerospace services business in the next quarter with again the proceeds coming in shortly after that. Both of these would give us almost 920 crores of proceeds.
Speaker #1: Proceeds that we will be using for our manufacturing build, manufacturing acquisition, and build-out. More importantly, what happens to the revenue that we have—that we have divested away?
Speaker #1: We clearly have committed to replacing these revenues both organically as well as inorganically. Organic revenue growth will happen through the kind of growth that you have seen already in our Defense and ASI businesses.
Speaker #1: Inorganic growth would happen through acquisitions, one of which Mohan had already referred to, and several more are in the pipeline and are likely to close this quarter.
Speaker #1: We are we are committing back to our guidance that we had made originally at the at the beginning of this financial year, which is a 1,300,000 77 crore revenue in FI27 on a continuing operations on an annualized proforma basis.
Speaker #1: EBITDA the EBITDA that you have divested away, as Mohan has clearly referred, is being brought back at a price that is at a fraction of what we sold it for.
Speaker #1: The acquisition in the aerospace as well as the organic growth as well as further acquisitions in the ZERA business will help us bring back this EBITDA by FI27 on a normalized proforma basis.
Speaker #1: So both on revenue EBITDA as well as earnings per share, we are well on track towards achieving our par 930 goals. We have we have committed to several specific activities that will be doing over the next three quarters.
Speaker #1: One of them that I already referred to is closing the divestment across the next two quarters. The other is, as you're aware, we had deferred certain revenues due to supply chain logistics we are well on track to have recovering that.
Speaker #1: This quarter out of 142 crore deferral, we had recovered over 60 crores and we'll be recovering the rest over the next two quarters. on track.
Speaker #1: We are committed to delivering on the aerospace acquisition by this quarter. And a ZERA acquisition by this quarter with closings within this quarter and early next quarter.
Speaker #1: We have several more in the pipeline and we expect the third and the fourth to close within the next two quarters. Ad solutions which we know is a business that has been a drag on Acquisitions again well our businesses across the last five, six quarters.
Speaker #1: We are working towards a sale which could realize over the course of FY27. On the space business, which is a fledgling business, as I've already mentioned, we have already set up and are working on the manufacturing, integration, and testing facilities as part of our new DAC complex.
Speaker #1: We will also be entering into strategic partnerships, and we'll announce these partnerships during the course of this quarter, both at the Bangalore Space Expo as well as the World Space Business Week in Paris.
Speaker #1: And finally, scaling up of our businesses. We expect a defense businesses on the back of an extremely strong 4,500 plus assured forecast visibility to grow at over 75% year on year over the next seven years.
Speaker #1: We also expect our ASI business to grow by over 100% this year, on the back of both organic growth as well as the acquisitions and business partnerships we have in place.
Speaker #1: This is a commitment that we are making to our shareholders, and we believe that each of these commitments is something that we will be able to deliver on within the timelines indicated.
Speaker #1: Thank you very much. That brings the close to my presentation. I will now hand over back to Shantini, who will then open up the floor for Q&A.
Speaker #2: Thanks, Mukund. Just a reminder to all our participants, if you want to ask questions, you'll have to raise your hand to join the question queue.
Speaker #2: Just a quick reminder on how to do that on this platform: If you're on desktop or laptop, look for the reactions button at the bottom of your Zoom window.
Speaker #2: Click on it, then select raise hand. Your name should appear on the queue and I'll call on you in order. If you're on mobile or tablet, tap on the more dot dot dot button at the bottom right of your screen, then select raise hand from the the Q&A session.
Speaker #2: We'll take the first question from Deepak Bodhar. Hi Deepak, you can go ahead and ask your questions. Yes, Deepak, go ahead.
Speaker #3: Yeah, thank you very much, sir, for this opportunity. So just first, I wanted to understand I mean, what is the thought process behind I mean, this aerospace division divestment?
Speaker #3: I mean, it's kind of giving you 70, 80 crores kind of a EBITDA on an annual basis. So I understand that you have aspiration for aerospace manufacturing, right?
Speaker #3: But couldn't we have done both together? And so, what would be the thought process behind that?
Speaker #1: Thanks, thanks, Deepak. I'll probably answer the question also, as Mohan, to pitch in as and when required. Clearly, for us, the four core areas that we focus on are aerospace, defense, the ZERA business—which is electronic semiconductors, AI—and the space business.
Speaker #1: But we also clearly indicated that part of our par 930 program, we would move from being a services focused company to being a product and solutions company.
Speaker #1: And it is this path that we have set out on. As part of this par 930 goal, we had indicated we had indicated obviously a sale of the engineering services business, but we also felt that it was the right time to be actually moving away from aerospace services into aerospace manufacturing.
Speaker #1: We had indicated the reasons why we had done that at the previous call that we had in the previous quarter. But let me let me again clarify on those aspects.
Speaker #1: One, we do see for see many of our services OEMs looking for consolidation this market. So the options for us is really to grow further by acquiring other business other businesses other businesses in the same services area or by selling to a global leader we'll be able to take this business and grow it further.
Speaker #1: Why did we choose the latter? Because we found that price that that which we could offer the latter as well as the deployment of the proceeds from that into our core par 930 vision would enable us to do that without any incremental equity dilution.
Speaker #1: Mohan, would you like to add anything more on this?
Speaker #3: Absolutely. So the value that we are able to generate by this is what is the differentiator, number one. Number two, the manufacturing aspect which you also asked, is more of a sticky business.
Speaker #3: So we are getting into long-term contracts a highly predictable business and that is actually leveraging some of the activities that we are doing in defense space and electronics.
Speaker #3: So it means that we are able to consolidate and leverage all of our business verticals and provide a total end-to-end solution to our customers.
Speaker #3: I hope we have answered your question. Yeah, you have answered. So couldn't we have done it both simultaneously? I mean, wouldn't that that be an option?
Speaker #3: I mean, being a hypothetical question, yes, but but when we look at the strategy, the idea was to grow more into a product-based business.
Speaker #3: So hence, the decision is purely based on that. Okay. Okay. And regarding these provisions that you mentioned—I mean, Rs. 22 crores—where are these accounted? Rs. 10 crores is the provision for receivables, Rs. 3.5 crores for hedge, and Rs. 22 crores for deal cost.
Speaker #3: Where has been this accounted in this financial?
Speaker #1: Shashi can hand it over to you.
Speaker #4: Yeah. So if you if you look at if you look at the financial statements as what has been filed, the 21 crores of the the transaction related cost is sitting in discontinued operations as an exceptional item.
Speaker #4: It does not come out specifically on the face of it. If you go to the notes to accounts, you'll be able to find that.
Speaker #4: And with respect to the provisions which I'm talking about, which is about 6.5 crores for a provision with respect to an order which we executed for the Ministry of Defense and another you know 3.14 for a defense PSU and then the unwinding of the hedge provision of 3.5 crores is is actually sitting in the continuing business which is a part of the other expenses which you see here.
Speaker #4: In the continuing operations.
Speaker #2: Thanks, Shashi, and thanks, Deepak, for your questions. You can keep your hand raised to join the question queue. We'll take the next question from the line of Kaushik Mohan.
Speaker #2: Hi Kaushik, you can go ahead and ask your questions.
Speaker #3: Hi sir, this is Kaushik. I just wanted to understand what will be the number as it comes to the PAT level because I can understand on the EBITDA level on our side, but can you give clarity on the PAT level?
Speaker #4: You're talking about the normalized PAT?
Speaker #3: Yes, normalized PAT. With 13 double 7 hotline this year closing. Is what we are talking about. I just wanted to understand what will be our PAT.
Speaker #4: You're talking about the quarter one PAT or the full year?
Speaker #3: Guidance.
Speaker #1: Can I take it?
Speaker #3: Yes.
Speaker #4: Yeah, yeah, please. Yeah.
Speaker #1: So as you have indicated, you know, we'll be replacing the EBITDA through both inorganic and organic organic growth and inorganic acquisitions. We have indicated an EBITDA of 270 crores.
Speaker #1: We expect PAT to be broadly around about 50% of that number. It could be higher because we'll actually have a lesser we'll have proceeds from the divestment that would be available to us that will help us paid on some of our debt and reduce our interest cost.
Speaker #3: So, we are talking about ₹135 crore as our PAT. Am I right?
Speaker #1: Broadly around those regions. Yes.
Speaker #3: Okay. So we we have have a lot of acquisitions and a lot of disinvestment of the business are going on, right? So this number will be not impacted.
Speaker #3: So I can think that Q2, Q3, Q4 will be ramping up on these numbers will be coming at you, right? Is what my understanding, right?
Speaker #1: That's correct. We expect the acquisitions to kick in over the next few quarters which will actually contribute to the top line and the bottom line.
Speaker #3: Perfect. And my second question, I just wanted to understand what is the update on the acquisition side. I can understand in the Q3 we'll be having one settlement of the money.
Speaker #3: In Q1 of this year, this quarter, we will be having one settlement of the money. With that, we are going for an acquisition. What will be our acquisition status?
Speaker #3: Here in the presentation, it is not mentioned very clearly for me. Can you give me the date, like, by this, this is the time that we are in the line?
Speaker #1: Yeah, it is covered in the multiple slides. One of course I'll cover from an aerospace perspective. The aerospace we are talking in Q2 and which is coming out very clearly in in my slide.
Speaker #1: So, we would be completing this—it's already, NBO is issued, and we are in the advanced DD phase. Our expectation is that we will complete the activity before the end of Q2.
Speaker #1: And we all we also have one more which we are evaluating and if it go if everything goes as per our plan that also we should be completing it by Q4.
Speaker #1: So these are the two opportunities that we are pursuing in aerospace. Maybe I can just cover on the on the ZDA side. On the ZDA as you know we already already underway with the business transfer agreement.
Speaker #1: And the business will as an acquisition will happen to us by this quarter. Again we are committing to doing that with this quarter. So we'll have two acquisitions in place generating revenues and generating bottom line by the end of this quarter.
Speaker #1: We do have a few other acquisitions, which we cannot disclose at this stage because they're still in the non-binding stage. As we get to a binding agreement and board approvals, we will come back to the markets and announce those acquisitions.
Speaker #3: Okay. And just want a clarity basis.
Speaker #1: Sorry, I can just clarify. I can just also clarify the Q3 and Q4 as we have clearly committed in our in our guidance. We will have one of those coming into in Q3 and one coming into Q4.
Speaker #3: Perfect. I just want some additional clarity. How is our next year looking? Because a lot of things are happening this year. I understand that this is a transformative stage for the year.
Speaker #3: For the entire life of what we are talking about—FY 2030 top lines of the guidance. So, how is the next year looking like?
Speaker #3: Do we have this kind of replica effects in next year also or this is the year that everything will be settled properly?
Speaker #1: When you say it will be settled, probably you're talking about the cost, as well as employees and everything—whatever we have here. A majority of our acquisitions will be in place by the end of this financial year.
Speaker #1: Which which and they'll start generating revenues and EBITDA for us. We will continue scouting the market for acquisitions and why why are we looking for acquisitions?
Speaker #1: Because we do see very interesting opportunities where we can quickly scale up in terms of capabilities in terms of customer access and in terms of getting in a specific order book or a specific certification that an existing target already has.
Speaker #1: So we will be in the market for it but these acquisitions will be much smaller in scale compared to what we're doing this year.
Speaker #2: Thanks, Mukund. We'll move on to the next question. We'll take the next question from the line of Praful Rai. Hi, Praful, you can go ahead and ask your questions.
Speaker #4: Yeah, I have two questions. One is on the defense order which is of 4,500 odd crores. Wanted to get a sense of what is the timeline for execution of this order.
Speaker #4: Can you give a broad time frame that this is the that this is the end number of years in which we are going to do that.
Speaker #4: That is question one. Second question is what is the defense order pitch pipeline we have? If you have a target of the the order intake for the year as a whole.
Speaker #4: These are the two questions I have. Thanks.
Speaker #3: I think, first, I have to answer your question. We are covering this entire forecast visibility before FY30, which is approximately about three years.
Speaker #3: There could be some spillover in the fourth year. And to address the second question I think Mukund already gave the FY 27 guidance. So we have that well in place.
Speaker #4: You see, because of this order—to clarify,
Speaker #1: There is a 75% revenue increase year-on-year in FY27 in defense.
Speaker #4: Okay. 20 75% year but this is a this is a finite time frame order. So you'll have a very strong growth for next year also.
Speaker #4: And my second question was on the pipeline of defense. Can you throw some light in terms of what is the kind of pipeline we are building because we are adding capacities to just get a sense of what kind of size of business we are expecting in addition to what we already have.
Speaker #3: Though the pipeline the the pipeline is quite quite huge. As you know we are we are covering pipeline across the unmanned systems the missiles and also the radar and DW are our core area.
Speaker #3: We have almost the the visibility that we have is is is exceeding about 24,000 crores. But that is a you know huge pipeline which actually converges into the you know forecast visibility which we are stated.
Speaker #4: Last question this 9:30 the target which we have we have been stating that for a while. Given the restructuring of the business we are doing are we still maintaining that that objective or there is a change in the.
Speaker #3: I will, I will, I will let Mukund answer that. Sure.
Speaker #1: Apart par 930 objective was in terms of had several components to it. One was in terms of a focus on certain sectors which we are well on track on.
Speaker #1: Other was in terms of moving us from being a services to a manufacturing company which we are well on track on. You can see that happening right now.
Speaker #1: And the third, of course, was revenue targets as well as the PAC targets. We did, at the time of formulating PAR 930, say today's revenue will be tomorrow's PAC, and that was a FY24 revenue of ₹960 crores, which we believe would be the PAC target by FY30 of ₹960 crores.
Speaker #1: We believe all these acquisitions these divestments the capital that's come in and and the growth that we have in the organic business will help us achieve that those targets.
Speaker #1: So apart 930 targets remain still still absolutely firm.
Speaker #4: If time permit can ask one more question.
Speaker #3: Okay.
Speaker #2: Yes, go ahead.
Speaker #4: Yeah. On this on this 9:30 we are talking of and this is all contingent on the acquisition which we are taking doing now. Is there any reason for us to believe that some of these acquisition acquisition is a binary event, right?
Speaker #4: It can happen or it may not happen. That some of these acquisition may slip out.
Speaker #1: Your you're perfectly valid question there. In terms of a aerospace acquisition, we clearly at a very advanced stage which is why we have indicated that we'll actually be close by this quarter itself.
Speaker #1: In terms of a zero acquisition, the business transfer acquisition, again at a very advanced stage, we already are working with that partner and we will be again closing that within this quarter.
Speaker #1: In terms of the other acquisitions, we are at we have we have few acquisitions across the various segments we work in. We are at non-binding offers moving in through due diligence yet to move into a binding offer.
Speaker #1: So your point out there about there being valid about there falling off is there but the fact remains that we have a pipeline of these acquisitions and these acquisitions in effect help us achieve a common objective which is an objective of getting a capability or getting access to a customer in a particular geography.
Speaker #2: Thanks, Mukund. We'll move on to the next participant. Our next participant asking a question is Mahek Talati. Hi, Mahek, you can go ahead and ask your question.
Speaker #5: Hi, sir. Good evening. Sir, my first question is with respect to project Kusha. What is the update over there?
Speaker #3: I think we have I've covered we are going deeper into you know Kusha project. We are in we are already we have the orders for developing multiple systems.
Speaker #3: It includes the the mobile mast and also it includes such an you know the electronics and we are already there in the digital beamforming unit for the radar and also we are getting into there are many more you know RFPs are in progress.
Speaker #3: So, we'll be quite deeper into Kusha, and also, probably, I'll take this occasion to say that we are also quite deep into Brahmos.
Speaker #5: And the LUH Maritime order that you have mentioned on the screen as well we were expecting that to deliver upwards of 150 170 crores for this year.
Speaker #5: Where are we on that?
Speaker #3: yes this has the visibility of approximately one one 150 to 170 crores is the visibility is the is the one which we have you know is the one which we are addressing.
Speaker #3: Yes we are well well well on track on that.
Speaker #5: And is it backed by a confirmed orders or is it a visibility?
Speaker #3: No no this is backed by a confirmed order.
Speaker #5: And for Kusha, we were supposed to qualify in this quarter. Where are we on that? How many are competing? What is the competitive landscape over here?
Speaker #3: Competition landscape obviously I'll not be able to discuss here but we are on four different you know platform four different you know modules for Kusha and it is you know and it is growing.
Speaker #5: And for MBDA, what is the forecast on the test bench that we would be supplying this year? And what is the revenue that we can expect from that?
Speaker #5: Also, for the launcher maintenance part.
Speaker #3: Sure. So the the test benches as you mentioned already last year itself we received you know a significant portion I mean one good start for our entire you know center of excellence for the test benches and we are growing across you know we were working on the Mika and Meteor platforms.
Speaker #3: Now we are going across the CAM and Aster platforms. So this year also we'll be every year we are we are you know we are working on about delivering about five test benches here on for next three years.
Speaker #3: So that is fully intact. And addressing the addressing the larger this thing MBDA as we mentioned our relationship is going quite deep and we will be addressing certain make in India efforts for you know going forward probably very soon you will hear those you know announcements.
Speaker #5: Okay. And what about launcher maintenance over there?
Speaker #3: Launcher maintenance is in different phases. Okay. That is you know carrying on and there actually there's a no there's a new you know set of activities that we are we have initiated you know on behalf of you know which is resulting as part of large order being placed on you know this you know you know on the Rafal.
Speaker #3: So we'll be much more deeply involved in multiple activities with MBDA.
Speaker #2: Thanks. And thanks for your questions. We'll move on to the next participant. Our next participant asking a question is from the line of Piyush Saravagi.
Speaker #2: Hi Piyush, you can go ahead and ask your questions.
Speaker #6: Yeah. Hi. Can you give—I know you touched upon this a few minutes ago—an update on MBDA's broader expansion? We had very large plans for expanding the MBDA partnership.
Speaker #6: What is the specific update on it and when do we start seeing first set of orders and work?
Speaker #3: I think we covered this partially in the previous question. MBDA, as I said, test bench, we are growing and our three-year plan is intact and it is already—the delivery is going on.
Speaker #3: And we have also now spreading across the new make in India initiatives as part of the Rafal program and it is across you know you know local assembly of missiles and also which is also we'll be also taking undertaking certain you know production of large electronics.
Speaker #3: So much of the details cannot be, you know, stated here, but we are very well on track and you will certainly see us in the announcements.
Speaker #6: Certainly. And secondly, Dr. Siren spoke about the seekers of Brahmo, I think a couple of calls ago or on the last call. What is the update on that?
Speaker #5: So we are in the advanced stage of realizing a prototype seeker for Brahmo's engine and we have received the acknowledgement and endorsement from the customer on that.
Speaker #5: We are also part of the EOI on that topic. We EOI process. We are doing two things in the seeker. One we are developing the seeker using the current specs in the ISA technology.
Speaker #5: We are also incorporating our proprietary direct RF technology onto the seeker. So two types of seekers we are developing. Which will be the next generation after the gimbal seekers are being phased out.
Speaker #5: So in addition to Brahmo's we are also developing the seeker for one more missile. So seeker will continue to be the technology that Axis CADAS would deploy for various missiles in the future.
Speaker #6: And so when do we start seeing business from from seekers?
Speaker #5: Next financial year announced.
Speaker #6: Okay. Sure. Thank you.
Speaker #2: Thanks Piyush for your questions. We'll take the next line of questions from Mayur Parkeria. Hi Mayur, you can go ahead and ask your questions.
Speaker #3: Thank you for taking my questions, and best wishes to the entire team of AXISCADES. And clearly, am I audible?
Speaker #6: Yes.
Speaker #2: Yes Mayur, go ahead.
Speaker #3: So you know clearly many many things going on in the company and as financial analyst it becomes it's very easy for us to just look at numbers but hats off to the entire team for pulling off all the required and the key long-term milestones in terms of divestment in terms of monetary aspects in terms of you know services to manufacturing and many other milestones which are there.
Speaker #3: So great you know it's a great effort and we can understand that. So congratulations to the entire team on that side. I just had one question we had plans for strategic partnership at the subsidiary level for our you know and the entire Capex program.
Speaker #3: In the light that now we have huge I mean huge you know funds available after divestment of the aerospace services also is that still on cards is it will it be slightly now not I mean since we are is it on the priority will it come little later just around that if you can give some understanding around the you know the the strategic partnership side.
Speaker #3: Thank you.
Speaker #6: Thank you. Shashi, would you like to take that, or do you want me to take it? Yeah, sure. You're right that we do have significant resources arising from the divestment, but we do have plans for these resources.
Speaker #6: But Roamer, our strategic investments in the joint ventures through a OEM partners was not just about capital it was about a commitment and for us also providing a commitment to a JV partners that we will have a dedicated facilities at times dedicated access dedicated IP for what we do for them out here.
Speaker #6: So we still continue having conversations with these OEM partners. Many of them are very interested and are very aware of precision manufacturing, as well as precision electronics, out of India. As India is becoming a global supply chain provider, many of our global OEMs are now looking at India as being a source for supplying their global supply chains, and they'd like to have a stake in that.
Speaker #6: So these conversations still are very much ongoing. They're ongoing with the existing OEM clients. They're ongoing with some of our newer OEM clients that we're talking to right now.
Speaker #6: They're very open to that.
Speaker #3: Sir, is there any timeline which we would like to call out right now, or is it slightly early at this stage?
Speaker #6: I think it's quite early right now. Not because we aren't ready for it. It's more a factor of some of these do take time.
Speaker #6: The way we work through it is, some of the OEM partners start working with us. They become our customers; then we become their partners, and then we graduate to becoming a more strategic partner through a JV.
Speaker #3: Okay. Sorry, I said space. You will hear more on this space from us. Okay? Okay. Can I just squeeze in one more question?
Speaker #2: Sure Mayur, go ahead.
Speaker #3: Yeah. Thank you. Sir on the space side you know while we have been mentioning space as the focus vertical will you be comfortable sharing any details right now or do you think as as things apart from the fact of acquisition or which we have mentioned or the partnership anything else would you be okay sharing because these are this can be little you know competitive and strategic in nature so anything on the space would you like to can you give us some understanding how to look at that?
Speaker #6: You know as you clearly mentioned we do have quite a few things on the anvil. We will be announcing some of these in two big events that's happening not very far away just a month down the line.
Speaker #6: One is the Bangalore Space Expo for those of you who know that and the other one is in Paris World Space Business Week in Paris.
Speaker #6: Both of that, watch out for the announcement that we'll make. These will be strategic partnerships—strategic relationships with some of the global space players—that will give us, provide us with technology, provide us with order, and provide us with the right kind of leg up that we need to make a success of the business.
Speaker #6: Please do that.
Speaker #3: Thank you. Thank you, sir. Wish you all the best.
Speaker #2: Thanks for your questions, Mayur. We'll take the next participant from the line of Bala Subramaniam A. Hi Bala, you can go ahead and ask your questions.
Speaker #7: Good evening sir. Thank you so much for the opportunities. Sir my first questions under defense side I think this one 40 crore earlier the revenue was deferred to Q2 and Q3.
Speaker #7: So, what are the key operational and customer-specific milestones that must be met to ensure this timely recovery? And whether it's related to the land systems program—I think it was mentioned on an earlier call that 20 units were ready and 85 in production.
Speaker #7: Is that that related that one and like I'm just trying to understand the deferrals and delays in terms of deliveries. I think the deferred
Speaker #4: delivery we have already you know committed that it will be completed in two quarters and you see that in the Q1 we have already recovered the most of it and Q2 we'll complete it.
Speaker #4: It is not related to those 20 systems but I think those things have already covered and it is the you know it is the the remaining spillover which should be covering.
Speaker #4: But we are covering in two quarters.
Speaker #7: Okay sir. Sir I think you have provided that the divestment timeline in phase one and surround Q2 and I don't 192 crore in phase two it's around 718 crore net per seats.
Speaker #7: I think right now maybe you are in the right position to give a year wise Capex guidance. I think earlier it's broadly mentioned 1600 crore for facilities and 600 crore for acquisition cost.
Speaker #7: If you go to share the year wise guidance in the in terms of Capex deployment and this 1255 crore extraordinary came expected from that phase one.
Speaker #7: You could specify that calculation numbers when it's going to realize and and I think this phase one and phase two it's going to happen divestment it's going to happen Q2 and Q3.
Speaker #7: Maybe, what kind of related costs are we going to, or like, realize in Q2 and Q3?
Speaker #6: Shashi can hand it over to you.
Speaker #5: Just talk yeah I'll just talk about the you know the extraordinary gain. Maybe you can talk about the Capex in terms of the yearly split.
Speaker #5: So essentially, you know, the extraordinary gain is nothing but the differential value between the divestment proceeds and the fair value of, you know, these businesses sitting in the balance sheet.
Speaker #5: And the differential which is you know extraordinary gain is that 1250 crores and that is going to be recorded on the on the actual closing of the transaction when we get the first dollar with respect to the the the divestment program.
Speaker #5: Like for example in the in the in August the first phase you know of the Zephyr is going to get done. For which we'll receive the proceeds and in the in the in second quarter itself we are going to recognize about 200 plus crores of extraordinary gain.
Speaker #5: The bigger piece is in the you know is in the November closing which we are trying to push back to about you know September all.
Speaker #5: So, between September, between Q2 and Q3, early Q3, you will see that this ₹1,255 crores of extraordinary gain is going to come into the P&L.
Speaker #7: On that Capex side sir. So let me just take that. A Capex plans you know as you said we we we we will be timing the Capex to to a great extent to the inflows that will be coming in.
Speaker #7: We had these two inflows June Q2 and Q3 and then we have the next set of inflows happening in FY28 and finally the last set of again a larger inflow coming in FY29.
Speaker #7: Our broadly our Capex plan will match the inflows that come in with whatever bridging amounts that are there being covered through short term bridge bridge financing.
Speaker #7: So that's broadly the plan. We still the reason we don't have a specific year on year or quarter on quarter Capex plan is because as you're aware two things.
Speaker #7: One the timing of our acquisitions is a function of various aspects including the the the the timing of when the readiness of the partner to actually sell the business out to us.
Speaker #7: And we know that can take its own time. Secondly in terms of a the Capex the Capex that we're building is in response to specific requirements of many of our partners.
Speaker #7: So we will time it so that we can build it at the time when it's actually required from our partners. And our Capex is as you know is going to be broadly around DAC which you already up and you know which is already construction is ongoing right now.
Speaker #7: MAC which construction is just going to start quite soon. And of course a new CAM which will be set up and will also have a share of Capex.
Speaker #7: Please Romo also some of the inflows will be coming in are also year mark for the acquisition that we have in place. And we already spoken about the acquisitions two in this quarter and then a few more in the pipeline to close by the end of the year.
Speaker #7: Sir I try to understand 20 30 percentage of like Capex through the short term bridge through debt.
Speaker #6: Shashi can hand it over to you.
Speaker #5: Yeah yeah see basic basically we are raising you know a facility you know pending this divestment process coming in because as what Mukund was saying you know the MAC construction is going to short starts very very short soon and the DAC construction is already going on as per a plan.
Speaker #5: So the objective is to kind of have this bridge facility till the time the divestment process come in. And that would be in the region of you know actual drawdown would not be more than 100 to 150 crores.
Speaker #7: Okay, sir. Okay, got it. Thank you.
Speaker #5: Yeah yeah.
Speaker #1: Thanks for your questions Bala. We have time for one more question and to all those who are in our queue please do write to us and we'll make sure your questions are answered.
Speaker #1: We'll go with the line of Jatin Chadhas Hi Jatin you can go ahead and ask your question.
Speaker #8: Hello am I audible?
Speaker #1: Yes Jatin go ahead.
Speaker #8: Thank you for the opportunity. Actually I had two questions first one is congratulations on getting the order on Antina Beam Controller. Regarding that I wanted to understand I was just I was curious to know how the entire value chain works.
Speaker #8: Do we also manufacture the butler matrix required for that and do we own the entire architecture of it right from the circuit diagram or how how does that work exactly when we get an order for a Antina Beam Controller how do we execute it.
Speaker #8: Could you explain it from a value chain perspective?
Speaker #7: It is yes we do we do cover the complete you know design of the Antina Beam Controller that is where the complete our value addition and the the entire you know and one is the design qualification and also the production of the you know production which is already going on.
Speaker #7: As far as the exact architecture is concerned it goes into bit of you know technical but certainly we are you know we take care of the entire you know module and we are you know and the the the digital part of it the digital you know the I mean part of it is quite quite you know complex.
Speaker #7: So probably architecture and those discussions are out of scopes of this this call.
Speaker #8: Oh, okay. Got it, sir. Maybe, probably, in a more private setting, I would get more answers.
Speaker #7: Sure sir absolutely.
Speaker #8: Sir on the second part I wanted to understand sir regarding directed energy weapons. I'm just getting a feel of the entire market and possibly the future requirements.
Speaker #8: I was speaking to a couple of people who are into this space or basically researching what their issue is like as in we grow the energy sorry the output the energy requirements becomes very challenging.
Speaker #8: So this will become a point solution because or it will become a mobile solution. As far as I remember the Celia's product which we have has the opportunity or has the capability of becoming a mobile solution also.
Speaker #8: So, how are we positioning this for ourselves, or as a product for the company?
Speaker #7: See there are two things that we are looking at. It's a very good question. It will be in the right right now the current power requirement and other things are all driving I mean we are the solution is being driven for a mobile solution where we need the complete power plant also accompanying the you know entire system.
Speaker #7: Okay, but, you know, there are certain, you know, strategic aspects where we are actually optimizing the power output versus the intended range and the power actually, you know, consumed or really required.
Speaker #7: And certainly portable solution which is you know which is also on the cards and we have certain modules you know specifically being you know internally being designed and developed to ensure that we have these things you know in in this in you know coming up in future.
Speaker #7: So we will be covering both the the beginning it will be a portal it will be a mobile based solution and going forward it will be a portable solution.
Speaker #8: Sir, so you don't see the power hurdle as a major obstacle, or is it solvable? With time, it will get solved—what is your sense on that?
Speaker #7: power no power already the the solutions are are in you know the the complete optimization path is actually in front of us. So we are we are you know we are already on well on the way to towards that.
Speaker #7: So it will be you know it will be handled appropriately.
Speaker #8: So there are different versions different power requirements of places.
Speaker #7: Yeah.
Speaker #8: So we are talking about 30 kilowatt. So and they are all not one single source carrying 30 kilowatts producing 30 kilowatts. They are modular also.
Speaker #8: The size will vary depending on the power requirement and the combination.
Speaker #1: Thank you and thanks to Jatin for your questions. To all our participants in the queue please do write to us and we'll make sure we get all your questions answered to your satisfaction.
Speaker #1: I'll now hand over back to Mukund for closing remarks. Over to you Mukund.
Speaker #8: Thank you Shantini. Thanks everyone for all the questions and for engaging with us through a quarter of transition. My sincere apologies for the technical glitch that we had on our side and the time that we lost on that.
Speaker #8: I do hope that we have managed to cover adequate ground post that. As you all know Q4 Q1 FY27 is the first of the few quarters of transition where the company has already built the teams the capability the and the infrastructure to be the company that we want to be at the end of this financial year.
Speaker #8: Our focus for the rest of the year will continue to be disciplined execution we will progress with the acquisition pipelines we will bring new capacity online and we'll deliver on a customer commitments.
Speaker #8: And our aim is to is to build Axiscades as a higher value aerospace defense electronics AI and and space business. We will continue keeping you updated through consistent and compliant disclosures going forward in the future.
Speaker #8: Thank you again very much. Thanks Shantini and your team too. Thank you.
Speaker #1: Thanks Mukund and thanks to the entire management team from Axiscades and to all our participants here for spending the evening with us. Please do feel free to write to our IR team to you know get back to you on any other further questions you may have.
Speaker #1: Thank you all for being with us this evening. We can now disconnect our lines. Thank you and have a good evening. Cheers.
Speaker #8: Thank you.
